Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Apr. 08, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity File Number | 000-54627 | ||
Entity Registrant Name | ATLAS FINANCIAL HOLDINGS, INC. | ||
Entity Incorporation, State or Country Code | E9 | ||
Entity Tax Identification Number | 27-5466079 | ||
Entity Address, Address Line One | 953 American Lane | ||
Entity Address, Address Line Two | 3rd Floor | ||
Entity Address, City or Town | Schaumburg | ||
Entity Address, State or Province | IL | ||
Entity Address, Postal Zip Code | 60173 | ||
Local Phone Number | 847 | ||
City Area Code | 472-6700 | ||
Title of 12(g) Security | Common, $0.003 par value per share | ||
Trading Symbol | AFHIF | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | true | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding (in shares) | 12,047,334 | ||
Entity Public Float | $ 6.9 | ||
Entity Central Index Key | 0001539894 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Statements of Fina
Consolidated Statements of Financial Position - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Cash and cash equivalents | $ 5,238 | $ 9,025 |
Restricted cash | 5,287 | 7,122 |
Premiums receivable (net of allowance of $800 and $800, respectively) | 13,442 | 38,607 |
Intangible assets, net | 2,235 | 2,625 |
Property and equipment, net | 18,815 | 21,793 |
Right-of-use asset | 888 | 1,592 |
Notes receivable | 18,017 | 17,709 |
Other assets | 1,895 | 1,086 |
Assets held for sale | 53,885 | 51,302 |
Total assets | 119,702 | 150,861 |
Liabilities | ||
Premiums payable | 19,416 | 43,988 |
Lease liability | 1,091 | 1,993 |
Due to deconsolidated affiliates | 19,170 | 11,172 |
Notes payable, net | 36,168 | 32,100 |
Other liabilities and accrued expenses | 4,342 | 7,302 |
Liabilities held for sale | 60,407 | 62,767 |
Total liabilities | 140,594 | 159,322 |
Commitments and contingencies (See Note 8) | ||
Shareholders’ deficit | ||
Additional paid-in capital | 81,840 | 81,548 |
Treasury stock, at cost: 255,505 shares of ordinary common voting shares at each of December 31, 2020 and December 31, 2019 | (3,000) | (3,000) |
Retained deficit | (100,199) | (87,469) |
Accumulated other comprehensive income, net of tax | 430 | 424 |
Total shareholders' deficit | (20,892) | (8,461) |
Total liabilities and shareholders' deficit | 119,702 | 150,861 |
Ordinary Voting Common Shares | ||
Shareholders’ deficit | ||
Ordinary voting common shares, $0.003 par value, 266,666,667 shares authorized, shares issued: December 31, 2020 - 12,248,798 and December 31, 2019 - 12,198,319; shares outstanding: December 31, 2020 - 11,993,293 and December 31, 2019 - 11,942,812 | 37 | 36 |
Restricted Voting Common Shares | ||
Shareholders’ deficit | ||
Restricted voting common shares, $0.003 par value, 33,333,334 shares authorized, shares issued and outstanding: December 31, 2020 and December 31, 2019 - 0 | $ 0 | $ 0 |
Consolidated Statements of Fi_2
Consolidated Statements of Financial Position (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Premium receivable, allowance | $ 800 | $ 800 |
Shareholders’ deficit | ||
Common shares, shares authorized (in shares) | 300,000,001 | |
Common shares, shares issued (in shares) | 12,248,798 | 12,198,319 |
Common stock, shares, outstanding (in shares) | 11,993,293 | 11,942,812 |
Ordinary Voting Common Shares | ||
Shareholders’ deficit | ||
Common shares, par value (USD per share) | $ 0.003 | $ 0.003 |
Common shares, shares authorized (in shares) | 266,666,667 | 266,666,667 |
Common shares, shares issued (in shares) | 12,248,798 | 12,198,319 |
Common stock, shares, outstanding (in shares) | 11,993,293 | 11,942,812 |
Treasury stock, common (in shares) | 255,505 | 255,505 |
Restricted Voting Common Shares | ||
Shareholders’ deficit | ||
Common shares, par value (USD per share) | $ 0.003 | $ 0.003 |
Common shares, shares authorized (in shares) | 33,333,334 | 33,333,334 |
Common shares, shares issued (in shares) | 0 | 0 |
Common stock, shares, outstanding (in shares) | 0 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | ||
Net premiums earned | $ 0 | $ 110,241 |
Commission income | 5,195 | 7,458 |
Net investment income | 0 | 1,902 |
Loss from change in fair value of equity securities | 0 | (277) |
Net realized (losses) gains | (3) | 821 |
Other income | 4,354 | 453 |
Total revenue | 9,546 | 120,598 |
Net claims incurred | 0 | 80,767 |
Acquisition costs | 2,934 | 11,825 |
Other underwriting expenses | 17,743 | 33,759 |
Amortization of intangible assets | 390 | 390 |
Intangible asset impairment loss | 0 | 740 |
Interest expense, net | 1,931 | 1,466 |
Loss on disposal of subsidiaries | 0 | 4,427 |
Total expenses | 22,998 | 133,374 |
Loss from operations before income taxes | (13,452) | (12,776) |
Income tax (benefit) expense | (484) | 223 |
Loss from continuing operations | (12,968) | (12,999) |
Income (loss) from discontinued operations, net of tax | 238 | (7,427) |
Net loss | $ (12,730) | $ (20,426) |
Basic net income (loss) per share attributable to common shareholders | ||
Continuing operations (in dollars per share) | $ (1.08) | $ (1.09) |
Discontinued operations (in dollars per share) | 0.02 | (0.62) |
Net loss (in dollars per share) | (1.06) | (1.71) |
Diluted net income (loss) per share attributable to common shareholders | ||
Continuing operations (in dollars per share) | (1.08) | (1.09) |
Discontinued operations (in dollars per share) | 0.02 | (0.62) |
Net loss (in dollars per share) | $ (1.06) | $ (1.71) |
Basic weighted average common shares outstanding (in shares) | 11,957,268 | 11,954,494 |
Diluted weighted average common shares outstanding (in shares) | 11,957,268 | 11,954,494 |
Consolidated Statements of Comprehensive (Loss) Income | ||
Net loss | $ (12,730) | $ (20,426) |
Other comprehensive income (loss): | ||
Changes in net unrealized investment gains (losses) | 161 | 1,917 |
Reclassification to net income (loss) | (155) | 2,243 |
Other comprehensive income (loss) | 6 | 4,160 |
Total comprehensive income (loss) | $ (12,724) | $ (16,266) |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' (Deficit) Equity - USD ($) $ in Thousands | Total | Ordinary Voting Common Shares | Restricted Voting Common Shares | Additional Paid-In Capital | Treasury Stock | Retained Deficit | Accumulated Other Comprehensive Income (Loss) |
Balance at beginning of period at Dec. 31, 2018 | $ 5,699 | $ 36 | $ 0 | $ 202,298 | $ (3,000) | $ (190,503) | $ (3,132) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Deconsolidation of ASI Pool Companies | 1,234 | (121,622) | 123,460 | (604) | |||
Net loss | (20,426) | (20,426) | |||||
Other comprehensive loss | 4,160 | 4,160 | |||||
Share-based compensation | 872 | 872 | |||||
Balance at end of period at Dec. 31, 2019 | (8,461) | $ 36 | 0 | 81,548 | (3,000) | (87,469) | 424 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net loss | (12,730) | (12,730) | |||||
Other comprehensive loss | 6 | 6 | |||||
Share-based compensation (in shares) | 1,000 | ||||||
Share-based compensation | 293 | 292 | |||||
Balance at end of period at Dec. 31, 2020 | $ (20,892) | $ 37 | $ 0 | $ 81,840 | $ (3,000) | $ (100,199) | $ 430 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Activities | ||
Net loss | $ (12,730) | $ (20,426) |
Adjustments to reconcile net loss to net cash flows used in operating activities: | ||
(Income) loss from discontinued operations, net of taxes | (238) | 7,427 |
Depreciation and amortization | 3,172 | 3,850 |
Share-based compensation expense | 292 | 872 |
Loss on deconsolidation of subsidiaries | 0 | 4,427 |
Amortization of intangible assets and goodwill impairment | 390 | 1,130 |
Loss from change in fair value of equity securities | 0 | 277 |
Net realized losses (gains) | 3 | (821) |
Gain in equity of investees | 0 | (563) |
Amortization of bond premiums and discounts | 0 | 218 |
Amortization of financing costs | 224 | 224 |
Net changes in operating assets and liabilities: | ||
Accrued investment income | 0 | 200 |
Premiums receivable, net | 22,472 | 39,669 |
Due from reinsurers and prepaid reinsurance premiums | 0 | (12,708) |
Deferred policy acquisition costs | 0 | 3,064 |
Other assets | (3,321) | 7,226 |
Claims liabilities | 0 | (21,484) |
Unearned premium reserves | 0 | (15,879) |
Due to reinsurers | 0 | (6,522) |
Premiums payable | (24,572) | (24,320) |
Due to deconsolidated affiliates | 7,997 | 392 |
Other liabilities and accrued expenses | (2,959) | (2,276) |
Net cash flows used in operating activities - continuing operations | (9,270) | (36,023) |
Net cash flows used in operating activities - discontinued operations | (15,261) | (12,735) |
Net cash flows used in operating activities | (24,531) | (48,758) |
Purchases of: | ||
Fixed income securities | 0 | (11,506) |
Short-term investments | 0 | (11,716) |
Other investments | 0 | (680) |
Property, equipment and other | (200) | (2,546) |
Proceeds from sale and maturity of: | ||
Fixed income securities | 0 | 52,364 |
Equity securities | 0 | 5,997 |
Short-term investments | 0 | 7,261 |
Other investments | 0 | 8,868 |
Property, equipment and other | 3 | 0 |
Net cash flows (used in) provided by investing activities - continuing operations | (197) | 48,042 |
Net cash flows provided by investing activities - discontinued operations | 10,578 | 19,700 |
Net cash flows provided by investing activities | 10,381 | 67,742 |
Financing activities: | ||
Proceeds from notes payable | 4,601 | 0 |
Repayment of notes payable | (756) | (183) |
Net cash flows provided by (used in) financing activities - continuing operations | 3,845 | (183) |
Net cash flows provided by financing activities - discontinued operations | 0 | 0 |
Net cash flows provided by (used in) financing activities | 3,845 | (183) |
Cash and Cash Equivalents, Period Increase (Decrease) [Abstract] | ||
Net change in cash and cash equivalents | (5,622) | 11,836 |
Cash and cash equivalents and restricted cash, beginning of period | 23,859 | |
Less: cash and cash equivalents of discontinued operations - beginning of period | 7,712 | |
Cash and cash equivalents, beginning of period | 16,147 | 34,155 |
Less: cash and restricted cash of ASI Pool Companies | 0 | 29,844 |
Cash and cash equivalents, end of period | 10,525 | 16,147 |
Supplemental disclosure of cash information: | ||
Cash paid for income taxes | (1,984) | (14,354) |
Cash paid for interest | $ 2,022 | $ 1,753 |
Nature of Operations and Basis
Nature of Operations and Basis of Presentation | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Nature of Operations and Basis of Presentation | Nature of Operations and Basis of Presentation Atlas Financial Holdings, Inc. (“Atlas” or “We” or the “Company”) commenced operations on December 31, 2010. The primary business of Atlas focuses on a managing general agency strategy, primarily through our wholly owned subsidiary, Anchor Group Management, Inc. (“AGMI”). AGMI focuses on a niche market orientation for the “light” commercial automobile sector. This sector includes taxi cabs, non-emergency para-transit, limousine, livery, including certain transportation network companies (“TNC”) drivers/operators, and business autos. Automobile insurance products provide insurance coverage in three major areas: liability, accident benefits and physical damage. Atlas’ business is carried out through its non-insurance company subsidiaries: AGMI, UBI Holdings Inc. (“UBI Holdings”) and UBI Holdings’ wholly-owned subsidiaries, optOn Digital IP Inc. (“OOIP”) and optOn Insurance Agency Inc. (“optOn” and together with OOIP and UBI Holdings, “UBI”). Prior to a strategic transition, our core business was the underwriting of commercial automobile insurance policies, focusing on the “light” commercial automobile sector, through American Country Insurance Company (“American Country”), American Service Insurance Company, Inc. (“American Service”) and Gateway Insurance Company (“Gateway” and together with American Country and American Service, the “ASI Pool Companies”) and Global Liberty Insurance Company of New York (“Global Liberty” and together with the ASI Pool Companies, our “Insurance Subsidiaries”), along with our wholly owned managing general agency, AGMI. The ASI Pool Companies were placed into rehabilitation under the statutory control of the Illinois Department of Insurance during the second half of 2019 and were subsequently placed into liquidation and have been deconsolidated from our consolidated financial statements as of October 1, 2019 as a result of these actions. Other regulatory actions were taken in certain states, including restriction, suspension, or revocation of certain state licenses and certificates of authority held by the ASI Pool Companies preceding and following the initiation of rehabilitation. During the fourth quarter of 2019, the Company began actively pursuing the potential sale of Global Liberty, and as a result, Global Liberty has been classified as a discontinued operation as of October 1, 2019. The Insurance Subsidiaries distribute their insurance products through AGMI, which has contracted a network of retail independent agents. Together, the Insurance Subsidiaries are licensed to write property and casualty (“P&C”) insurance in 49 states and the District of Columbia in the U.S. Atlas’ core products are actively distributed in 41 of those states plus the District of Columbia. The Insurance Subsidiaries and the Company’s other non-insurance subsidiaries share common management and operating infrastructure. During the third quarter of 2019, new business writings were restricted or stopped in connection with certain Insurance Subsidiaries. Atlas’ ordinary voting common shares are listed on the OTC Markets system under the symbol “AFHIF”. Basis of Presentation These statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The consolidated financial statements include the accounts of Atlas and the entities it controls. Equity investments in entities that we do not consolidate, including corporate entities in which we have significant influence and partnership and partnership-like entities in which we have more than minor influence over operating and financial policies, are accounted for under the equity method unless we have elected the fair value option. All significant intercompany accounts and transactions have been eliminated. Seasonality The P&C insurance business is seasonal in nature. Our ability to generate commission income is also impacted by the timing of policy effective periods in the states in which we operate and products provided by our business partners. For example, January 1 st and March 1 st are common taxi cab renewal dates in Illinois and New York, respectively. Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the accounts of Atlas and the entities it controls. Subsidiaries are entities over which Atlas, directly or indirectly, has the power to govern the financial and operating policies in order to obtain the benefits from their activities, generally accompanying an equity shareholding of more than one half of the voting rights. Subsidiaries are fully consolidated from the date on which control is transferred to Atlas and would be deconsolidated from the date that control ceases. The operating results of subsidiaries acquired or disposed of during the year will be included in the consolidated statements of operations from the effective date of acquisition and up to the effective date of disposal, as appropriate. All significant intercompany transactions and balances are eliminated in consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by Atlas. The following are Atlas’ subsidiaries, all of which are 100% owned, either directly or indirectly, together with the jurisdiction of incorporation, that are included in consolidated financial statements: • American Insurance Acquisition Inc. (Delaware) • Anchor Group Management Inc. (New York) • Anchor Holdings Group, Inc. (New York) • Global Liberty Insurance Company of New York (New York), classified as a discontinued operation • UBI Holdings Inc. (Delaware) • optOn Digital IP Inc. (Delaware) • optOn Insurance Agency Inc. (Delaware) The following are Atlas’ subsidiaries, all of which are 100% owned, either directly or indirectly, together with the jurisdiction of incorporation, that are not included in consolidated financial statements effective October 2019, as management no longer has direct financial control over the estates of these entities: • American Country Insurance Company (Illinois) • American Service Insurance Company, Inc. (Illinois) • Gateway Insurance Company (Illinois) Estimates and Assumptions The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates, and changes in estimates are recorded in the accounting period in which they are determined. Significant estimates in the accompanying financial statements include revenue recognition, fair value of financial instruments, evaluation of assets for impairment, deferred policy acquisition cost recoverability and deferred tax asset valuation. Financial Instruments Financial instruments are recognized and unrecognized using trade date accounting, since that is the date Atlas contractually commits to the purchase or sale with the counter-party. Investment Income and Realized Gains (Losses) For securities other than mortgage-backed and asset-backed, Atlas utilizes the effective interest method to calculate the amortized cost of the financial asset and to amortize the premium or accrete the discount over the remaining life. The effective interest rate is the rate that discounts the estimated future cash flows through the expected life of the financial instrument. Mortgage-backed and asset-backed securities are valued using the retrospective adjustment method, which uses the effective interest method and includes anticipated prepayments. Interest income is reported net of amortization of premium and accretion of discount. Realized gains and losses on disposition of available-for-sale securities are based on the net proceeds and the adjusted cost of the securities sold using the specific identification method. Cash and Cash Equivalents Cash and cash equivalents include cash and highly liquid securities with original maturities of 90 days or less. Short-Term Investments Short-term investments consist of investments with original maturities between three months and one year and are reported at cost, which approximates fair value. Restricted Cash In its capacity as a managing general agent, AGMI collects premiums from agents and insureds and after deducting its commissions and/or fees, remits the premiums to the respective insurance underwriters. These unremitted amounts are reported as restricted cash in the accompanying consolidated statements of financial position with the related liability reported as premiums payable. Investments Investments in fixed income are classified as available-for-sale. Securities are classified as available-for-sale when Atlas may decide to sell those securities due to changes in market interest rates, liquidity needs, changes in yields or alternative investments, and for other reasons. Available-for-sale securities are carried at fair value, with unrealized gains and losses, net of income taxes, included as a separate component of accumulated other comprehensive (loss) income in shareholders’ equity. In the normal course of investing activities, the Company enters into relationships with variable interest entities (“VIE”), as an investor in limited partnerships or limited liability companies. The Company is not the primary beneficiary of these VIE’s and therefore does not consolidate them. The Company determines whether it is the primary beneficiary of a VIE based on a qualitative assessment of the relative power and benefits of the Company and the other participants in the VIE. The Company’s maximum exposure to loss with respect to these investments is limited to the investment carrying values and any unfunded commitments. Fair Values of Financial Instruments Atlas has used the following methods and assumptions in estimating its fair value disclosures: Fair values for investments are based on quoted market prices, when available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments or values obtained from independent pricing services. Atlas’ fixed income portfolio is managed by a Securities and Exchange Commission (“SEC”) registered investment adviser specializing in the management of insurance company portfolios. Management works directly with them to ensure that Atlas benefits from their expertise and also evaluates investments as well as specific positions independently using internal resources. Atlas’ investment adviser has a team of credit analysts for all investment grade fixed income sectors. The investment process begins with an independent analyst review of each security’s credit worthiness using both quantitative tools and qualitative review. At the issuer level, this includes reviews of past financial data, trends in financial stability, projections for the future, reliability of the management team in place and market data (credit spread, equity prices, trends in this data for the issuer and the issuer’s industry). Reviews also consider industry trends and the macro-economic environment. This analysis is continuous, integrating new information as it becomes available. As of December 31, 2020, this process did not generate any significant difference in the rating assessment between Atlas’ review and the rating agencies. Atlas employs specific control processes to determine the reasonableness of the fair value of its financial assets. These processes are designed to supplement those performed by Atlas’ investment adviser to ensure that the values received from them are accurately recorded and that the data inputs and the valuation techniques utilized are appropriate, consistently applied, and that the assumptions are reasonable and consistent with the objective of determining fair value. For example, on a continuing basis, Atlas assesses the reasonableness of individual security values that have stale prices or whose changes exceed certain thresholds as compared to previous values received from Atlas’ investment adviser or to expected prices. The portfolio is reviewed routinely for transaction volumes, new issuances, any changes in spreads, as well as the overall movement of interest rates along the yield curve to determine if sufficient activity and liquidity exists to provide a credible source for market valuations. When fair value determinations are expected to be more variable, they are validated through reviews by members of management or the Board of Directors who have relevant expertise and who are independent of those charged with executing investment transactions. Atlas employs a fair value hierarchy to categorize the inputs it uses in valuation techniques to measure the fair value. The hierarchy is comprised of quoted prices in active markets (Level 1), third party pricing models using available trade, bid and market information (Level 2), and internal models without observable market information (Level 3). The Company recognizes transfers between levels of the fair value hierarchy at the end of the period in which events occur impacting the availability of inputs to the fair value methodology. Premiums Receivable Premiums receivable include premium balances due and uncollected and installment premiums not yet due from agents and insureds. Atlas evaluates the collectability of accounts receivable based on a combination of factors. When aware of a specific customer’s inability to meet its financial obligations, such as in the case of bankruptcy or deterioration in the customer’s operating results or financial position, Atlas records a specific reserve for bad debt to reduce the related receivable to the amount Atlas reasonably believes is collectible. Atlas also records reserves for bad debt for all other customers based on a variety of factors, including the length of time the receivables are past due and historical collection experience. Accounts are reviewed for potential write-off on a case-by-case basis. Accounts deemed uncollectible are written off, net of expected recoveries. If circumstances related to specific customers change, estimates of the recoverability of receivables could be further adjusted. Deferred Policy Acquisition Costs Atlas incurs costs to fulfill a contract (or anticipated contract) with a client. Those costs are incurred prior to the effective date of the contract and relate to fulfilling our primary placement obligations to our clients. Our costs to fulfill prior to the effective date are capitalized and amortized on the effective date. These fulfillment activities include collecting underwriting information and negotiating their placement with an insurance carrier. The majority of costs that we incur relate to compensation and benefits of our underwriting staff. Costs incurred during preplacement activities are expected to be recovered in the future. If the capitalized costs are no longer deemed to be recoverable, then they would be expensed. Income Taxes Income tax expense includes all taxes based on taxable income or loss of Atlas and its subsidiaries, and is recognized in the statements of operations except to the extent that they relate to items recognized directly in other comprehensive income, in which case the income tax effect is also recognized in other comprehensive income or loss. Deferred taxes are recognized based on the differences in the tax basis of assets, liabilities and items recognized directly in equity and the financial reporting basis of such items. Deferred tax assets are recognized only to the extent that it is probable that future taxable income will be available against which they can be utilized. Deferred tax assets and liabilities (“DTAs” and “DTLs”) are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period of enactment. When considering the extent of the valuation allowance on Atlas’ DTAs, weight is given by management to both positive and negative evidence. U.S. GAAP states that a cumulative loss in recent years is a significant piece of negative evidence that is difficult to overcome in determining that a valuation allowance is not needed against DTAs. However, the strength and trend of earnings, as well as other relevant factors are considered. Atlas accounts for uncertain tax positions in accordance with the income taxes accounting guidance. Atlas analyzes filing positions in the federal and state jurisdiction where it is required to file tax returns, as well as the open tax years in these jurisdictions. Atlas would recognize interest and penalties related to unrecognized tax benefits as a component of the provision for federal income taxes. Intangible Assets Atlas recognized intangible assets as part of the acquisitions of Gateway and Anchor Holdings Group, Inc. The intangible assets are classified as either indefinite-lived or definite-lived depending on whether the useful lives can be identified. Atlas indefinite-lived intangible assets consisted of state insurance licenses, and these intangible assets are reviewed for impairment at least annually. Definite-lived intangible assets are amortized over their useful lives on a straight-line basis except for customer related intangibles, which are on an accelerated basis. Atlas definite-lived intangible assets consist of trade names and trademarks with useful lives of 15 years and customer relationships with useful lives of 10 years. The intangible assets are reviewed for impairment at least annually. Property and Equipment Buildings, office equipment and internal use software are stated at historical cost less depreciation and amortization. Subsequent costs are included in the asset’s carrying amount or capitalized as a separate asset only when it is probable that future economic benefits will be realized. Land is stated at historical cost. Internal use software includes costs associated with the Company’s policy and claims system including costs to develop those systems. Costs incurred during the preliminary project stage are expensed as incurred; costs incurred for activities during the application development stage are capitalized; and costs incurred during the post-implementation/operation stage are expensed as incurred. Upon reaching the post-implementation/operation stage of the development of internal use software, the capitalized costs are amortized over the estimated useful life of the asset. Depreciation on buildings and building improvements are provided on a straight-line basis over the estimated useful life of 33 years for buildings and 10 years for building improvements. Depreciation and amortization on equipment and internal use software is provided on a straight-line basis over the estimated useful lives which range from 5 years for vehicles, 5 years for furniture, 5 years for enterprise software and 3 years for all other software and computer equipment and the term of the lease for leased equipment. Repairs and maintenance are recognized as an expense during the period incurred. Insurance Contracts Contracts under which Atlas’ Insurance Subsidiaries accept risk at the inception of the contract from another party (the insured holder of the policy) by agreeing to compensate the policyholder or other insured beneficiary if a specified future event (the insured event) adversely affects the holder of the policy are classified as insurance contracts. All policies are short-duration contracts. Revenue Recognition Revenues from contracts with customers include both commission and fee income. The recognition and measurement of revenue is based on the assessments of individual contract terms. As an MGA, AGMI has contracts with various insurance carriers which determines AGMI’s commission income revenue. Each contract specifies what our performance obligations are as an MGA and what determines our commission income revenue, generally gross written premiums, net of cancellations and refunds. Under these contracts there are a number of performance obligations; however, it is the bundle of these services and not a single obligation that results in the performance of the MGA under the contracts. The Company considers these performance obligations as a non-bifurcated bundle of services where the performance obligations are satisfied simultaneous to the point in time where AGMI issues a policy, or cancels a policy to an insured. The commission rate stated in the individual contract is the standalone selling price of these non-bifurcated services which is allocated to the service bundle and not to any individual obligation under the various contracts. Premium income is recognized on a pro rata basis over the terms of the respective insurance contracts. Claims Liabilities The provision for unpaid claims represents the estimated liabilities for reported claims reported prior to the close of the accounting period, estimates for unreported claims based on industry data and actuarial estimates, plus related estimated claim adjustment expenses based on the experience of the Company. Unpaid claim adjustment expenses are determined using case-basis evaluations and statistical analyses, including insurance industry claims data, and represent estimates of the ultimate cost of all claims incurred. The amount of uncertainty in the estimates is significantly affected by such factors as the amount of claims experience relative to the development period, knowledge of the actual facts and circumstances and the amount of insurance risk retained. The actuarial methods for making estimates for unpaid claims and for establishing the ultimate liability are periodically reviewed, and any adjustments are reflected in current operations. Reinsurance As part of Atlas’ insurance risk management policies, portions of its insurance risk is ceded to reinsurers. Reinsurance premiums and claims expenses are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts. Premiums and claims ceded to other companies have been reported as a reduction of premium revenue and claims incurred. Commissions paid to Atlas by reinsurers on business ceded have been accounted for as a reduction of the related policy acquisition costs. Reinsurance recoverables are recorded for that portion of paid and unpaid claims and claims adjustment expenses that are ceded to other companies. Prepaid reinsurance premiums are recorded for unearned premiums that have been ceded to other companies. Share-Based Compensation Atlas has a share-based compensation plan that is described in Note 12, ‘Share-Based Compensation,’ to the Consolidated Financial Statements. Atlas uses the fair-value method of accounting to determine and account for equity settled transactions and to determine stock-based compensation for awards granted to employees and non-employees. Compensation expense is estimated based on the fair value of the award at the grant date and is recognized in net income over the requisite service period with a corresponding increase to additional paid in capital. The share-based compensation expense associated with awards that have graded vesting features and vest based on service conditions is calculated on a straight-line basis over the requisite service period for the entire award. Compensation expense recognized in connection with performance awards is based on the achievement of the specified performance and service conditions. During the recognition period compensation expense is accrued based on the performance condition that is probable of achievement. The final measure of compensation expense recognized over the requisite service period reflects the final performance outcome. Operating Segments Atlas operates in one business segment, the Managing General Agency segment. Reclassifications Certain accounts in the prior years’ consolidated financial statement have been reclassified for comparative purposes to conform to the current year’s presentation. |
New Accounting Standards
New Accounting Standards | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Standards | New Accounting Standards Pertinent Accounting Standard Updates (“ASUs”) are issued from time to time by the FASB and are adopted by the Company as they become effective. All recently issued accounting pronouncements with effective dates prior to January 1, 2021 have been adopted by the Company. Recently Adopted Leases In March 2019, December 2018, July 2018 and February 2016, the FASB issued ASI 2019-01 Leases (Topic 842) Codification Improvements, ASU 2018-20 Leases (Topic 842) Narrow-Scope Improvements for Lessors, ASU 2018-11 Leases (Topic 842): Targeted Improvements and ASU 2018-10 Codification Improvements to Topic 842, Leases and ASU 2016-02, Leases (Topic 842), respectively. The provisions of these updates impact the classification criteria, disclosure requirements, and other specific transactions in lease accounting. The updates require either the use of a modified retrospective approach, which requires leases to be measured at the beginning of the earliest period presented, or the transition method, which requires entities to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company adopted the updates on January 1, 2019 using the transition method with no change to comparative periods. See Note 16, Leases, for further discussion of future lease commitments. The adoption of these updates resulted in the recognition of both a right-of-use asset and lease liability in the amounts of approximately $2.5 million and $3.1 million, respectively. There was no impact to any of Atlas’ current financial covenants as a result of the increase to reported liabilities. Premium Amortization on Purchased Callable Debt Securities In March 2017, the FASB issued ASU 2017-08, Receivables-Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. This guidance shortens the amortization period to the earliest call date for certain purchased callable debt securities held at a premium that have explicit, noncontingent call features and are callable at a fixed price and preset date. For public entities, this guidance is effective for years beginning after December 31, 2018, including interim periods within those years. The Company adopted the update on January 1, 2019 with no impact on the Company’s consolidated financial statements because Global Liberty’s callable debt securities, that are held at a premium, are amortized to the earliest call date, which is consistent with current accounting treatment. All other recently issued pronouncements with effective dates after December 31, 2020 are not expected to have a material impact on the consolidated financial statements. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Indefinite-lived intangible assets are tested for impairment annually or when a triggering event occurs. As a result of the liquidation and subsequent sale of Gateway Insurance Company, the Company recorded an impairment loss of $740,000 of indefinite-lived intangible assets during 2019. There were no intangible asset impairments recorded in 2020. Intangible Assets by Major Asset Class ($ in ‘000s) Economic Useful Life Gross Carrying Amount Accumulated Amortization Net As of December 31, 2020 Trade name and trademark 15 years $ 1,800 $ 703 $ 1,097 Customer relationship 10 years 2,700 1,562 1,138 $ 4,500 $ 2,265 $ 2,235 As of December 31, 2019 Trade name and trademark 15 years $ 1,800 $ 581 $ 1,219 Customer relationship 10 years 2,700 1,294 1,406 $ 4,500 $ 1,875 $ 2,625 Atlas recognized amortization expense of $390,000 in each of the twelve months ended December 31, 2020 and 2019. Estimated future amortization expense for definite-lived intangible assets is $390,000 for each of the next five years. |
Loss From Continuing Operations
Loss From Continuing Operations per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Loss From Continuing Operations per Share | Loss From Continuing Operations per Share Computations of Basic and Diluted Loss per Common Share from Continuing Operations ($ in ‘000s, except share and per share amounts) Year ended December 31, 2020 2019 Basic Loss from continuing operations before income taxes $ (13,452) $ (12,776) Income tax (benefit) expense (484) 223 Net loss attributable to common shareholders from continuing operations $ (12,968) $ (12,999) Basic weighted average common shares outstanding 11,957,268 11,954,494 Loss per common share basic from continuing operations $ (1.08) $ (1.09) Diluted Basic weighted average common shares outstanding 11,957,268 11,954,494 Dilutive potential ordinary shares: Dilutive stock options outstanding — — Diluted weighted average common shares outstanding 11,957,268 11,954,494 Loss per common share diluted from continuing operations $ (1.08) $ (1.09) Common shares are defined as ordinary voting common shares, restricted voting common shares and participative restricted stock units (“RSUs”). Earnings per common share diluted is computed by dividing net income by the weighted average number of common shares outstanding for each period plus the incremental number of shares added as a result of converting dilutive potential ordinary voting common shares, calculated using the treasury stock method. Atlas’ potential dilutive ordinary voting common shares consists of outstanding stock options to purchase ordinary voting common shares and warrants to purchase 2,387,368 ordinary voting common shares of Atlas for $0.69 per share. |
Contracts with Customers
Contracts with Customers | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Contracts with Customers | Contracts with Customers The revenue included as commission income for 2020 and 2019 totaled $5.2 million and $7.5 million, respectively. The balance of receivables related to contracts with customers, which is recorded as part of premiums receivable on the Consolidated Statements of Financial Position as of December 31, 2020 and 2019: Components of Commission Receivables ($ in ‘000s) Year ended December 31, 2020 2019 Commission receivable, beginning of year $ 1,428 $ — Commission revenue 5,195 7,458 Net change in cash received (4,046) (6,030) Commission receivable, end of year $ 2,577 $ 1,428 |
Investments
Investments | 12 Months Ended |
Dec. 31, 2020 | |
Investments [Abstract] | |
Investments | Investments It should be noted that due to the deconsolidation of the ASI Pool Companies and the discontinued operation classification of Global Liberty, no tables have been disclosed with respect to investment holdings at December 31, 2020 or 2019. Results of operations through September 30, 2019 of the ASI Pool Companies have been disclosed where applicable. Components of Net Investment Income ($ in ‘000s) Year ended December 31, 2020 2019 Total investment income Interest income $ — $ 1,877 Income from other investments — 793 Investment expenses — (768) Net investment income $ — $ 1,902 Aggregate Proceeds and Gross Realized Investment Gains and Losses ($ in ‘000s) Year ended December 31, 2020 2019 Fixed income securities: Proceeds from sales and calls $ — $ 42,406 Gross realized investment gains — 450 Gross realized investment losses — (205) Equities: Proceeds from sales — 5,997 Gross realized investment gains — 443 Gross realized investment losses — (96) Other investments: Proceeds from sales — 3,997 Gross realized investment gains — 250 Gross realized investment losses — (21) Total: Proceeds from sales and calls $ — $ 52,400 Gross realized investment gains — 1,143 Gross realized investment losses — (322) Components of Net Realized Gains ($ in ‘000s) Year ended December 31, 2020 2019 Fixed income securities $ — $ 245 Equities — 347 Other investments — 229 Net realized gains $ — $ 821 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Reconciliation of U.S. Statutory Marginal Income Tax Rate to the Effective Tax Rate - Continuing Operations ($ in ‘000s) Year ended December 31, 2020 2019 Amount % Amount % Provision for taxes at U.S. statutory marginal income tax rate $ (2,825) 21.0 % $ (2,683) 21.0 % Provision for deferred tax assets deemed unrealizable (valuation allowance) 1,744 (13.0) 2,779 (21.8) Nondeductible expenses (3) — 28 (0.2) Tax-exempt income — — (3) — State tax (net of federal benefit) (3) — 71 (0.6) Stock compensation 630 (4.7) 31 (0.2) Tax rate differential (42) 0.3 — — Other 15 (0.1) — — Provision for income taxes for continuing operations $ (484) 3.5 % $ 223 (1.8) % Reconciliation of U.S. Statutory Marginal Income Tax Rate to the Effective Tax Rate - Discontinued Operations ($ in ‘000s) Year ended December 31, 2020 2019 Amount % Amount % Provision for taxes at U.S. statutory marginal income tax rate $ (60) 21.0 % $ (1,560) 21.0 % Provision for deferred tax assets deemed unrealizable (valuation allowance) (264) 92.9 1,559 (21.0) Nondeductible expenses 2 (0.7) 3 — Tax-exempt income — — (2) — Tax rate differential (200) 70.4 — — Provision for income taxes for discontinued operations $ (522) 183.6 % $ — — % Components of Income Tax (Benefit) Expense - Continuing Operations ($ in ‘000s) Year ended December 31, 2020 2019 Current tax (benefit) expense $ (484) $ 223 Components of Income Tax (Benefit) Expense - Discontinued Operations ($ in ‘000s) Year ended December 31, 2020 2019 Current tax (benefit) $ (522) $ — During 2013 and 2019, due to shareholder activity, “triggering events” as determined under IRC Section 382 occurred. As a result, under IRC Section 382, the use of the Company’s net operating loss and other carryforwards generated prior to the “triggering events” will be subject to a yearly limitation as a result of this “ownership change” for tax purposes, which is defined as a cumulative change of more than 50% during any three-year period by shareholders owning 5% or greater portions of the Company’s shares. Due to the mechanics of the Section 382 calculation, when there are multiple triggering events the Company’s losses will generally be limited based on the thresholds of the 2019 triggering event. The Company has established a valuation allowance against the NOLs that will expire unused as a result of the yearly limitation. Components of Deferred Income Tax Assets and Liabilities ($ in ‘000s) December 31, 2020 2019 Gross deferred tax assets: Losses carried forward $ 16,408 $ 10,264 Claims liabilities and unearned premium reserves 496 554 Investment in affiliates 23,870 24,450 Bad debts 168 168 Stock compensation 279 873 Other 203 81 Valuation allowance (33,420) (32,522) Total gross deferred tax assets 8,004 3,868 Gross deferred tax liabilities: Deferred policy acquisition costs 134 112 Investments 122 116 Fixed assets 1,344 2,099 Intangible assets 469 551 Other 5,935 990 Total gross deferred tax liabilities 8,004 3,868 Net deferred tax assets $ — $ — Net Operating Loss Carryforward as of December 31, 2020 by Expiry Date ($ in ‘000s) Year of Occurrence Year of Expiration Amount 2011 2031 $ 1 2012 2032 70 2015 2035 1 2017 2037 13,649 2018 2038 8,903 2018 Indefinite 8,245 2019 2039 4,973 2019 Indefinite 6,306 2020 2040 31,300 2020 Indefinite 4,686 Total $ 78,134 Deferred tax assets are recognized to the extent that it is probable that future taxable income will be available against which they can be utilized. When considering the extent of the valuation allowance on Atlas’ deferred tax assets, weight is given by management to both positive and negative evidence. U.S. GAAP states that a cumulative loss in recent years is a significant piece of negative evidence that is difficult to overcome in determining that a valuation allowance is not needed against deferred tax assets. Based on Atlas’ cumulative loss in recent years and certain deferred tax assets subject to a yearly limitation under Section 382 which will likely result in expiration before utilization, Atlas has established a valuation allowance of $33.4 million and $32.5 million for its gross future deferred tax assets as of December 31, 2020 and 2019, respectively. Atlas accounts for uncertain tax positions in accordance with the income taxes accounting guidance. Atlas has analyzed filing positions in the federal and state jurisdictions where it is required to file tax returns, as well as the open tax years in these jurisdictions. Atlas believes that its federal and state income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material change to its financial position. Therefore, no reserves for uncertain federal and state income tax positions have been recorded. Atlas would recognize interest and penalties related to unrecognized tax benefits as a component of the provision for federal income taxes. Atlas did not incur any federal income tax |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and ContingenciesIn the ordinary course of its business, Atlas is involved in legal proceedings, including lawsuits, regulatory examinations and inquiries.Atlas is exposed to credit risk on balances receivable from insureds and agents. Credit exposure to any one individual insured is not material. The policies placed with risk taking partners are distributed by agents who may manage cash collection on its behalf pursuant to the terms of their agency agreement. Atlas has procedures to monitor and minimize its exposure to delinquent agent balances, including, but not limited to, reviewing agent account statements, processing policy cancellations for non-payment and other collection efforts deemed appropriate. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and Equipment Held 1 ($ in ‘000s) As of December 31, 2020 2019 Buildings $ 7,425 $ 7,425 Land 1,840 1,840 Building improvements 9,031 9,023 Leasehold improvements 193 193 Internal use software 12,795 12,610 Computer equipment 1,838 1,925 Furniture and other office equipment 1,121 1,150 Total $ 34,243 $ 34,166 Accumulated depreciation (15,428) (12,373) Total property and equipment, net $ 18,815 $ 21,793 1 Excluding assets held for sale. Depreciation expense and amortization from continuing operations was $3.2 million and $3.9 million in 2020 and 2019, respectively. As part of a cost sharing agreement with affiliates under common ownership, depreciation expense of $0 and $250,000 was allocated to Global Liberty during 2020 and 2019, respectively. During 2016, Atlas purchased a building and land for $9.3 million to serve as its new corporate headquarters to replace its former leased office space. Atlas’ Chicago area staff moved into this space in late October 2017 and occupies approximately 70,000 square feet in the building. An unrelated tenant occupies the remaining office space in the building. Rental income related to this lease agreement was $462,000 and $408,000 in 2020 and 2019, respectively. Depreciation expense related to the building and its improvements was $1.1 million and $1.1 million in 2020 and 2019, respectively. For the years ended December 31, 2020 and 2019, the Company capitalized $185,000 and $2.4 million, respectively, of costs incurred, consisting primarily of external consultants and internal labor costs incurred during the application development stage of the internal use software. Substantially all of the costs incurred during the period were part of the application development stage. For the years ended December 31, 2020 and 2019, there was $1.4 million and $1.9 million, respectively, of amortization expense recorded for projects in the post-implementation stage. |
Reinsurance Ceded
Reinsurance Ceded | 12 Months Ended |
Dec. 31, 2020 | |
Underwriting Policy and Reinsurance Ceded [Abstract] | |
Reinsurance Ceded | Reinsurance Ceded As is customary in the insurance industry, Atlas reinsures portions of certain insurance policies it writes, thereby providing a greater diversification of risk and minimizing exposure on larger risks. Atlas remains contingently at risk with respect to any reinsurance ceded and would incur an additional loss if an assuming company were unable to meet its obligation under the reinsurance treaty. Atlas monitors the financial condition of its reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. Letters of credit are maintained for any unauthorized reinsurer to cover ceded unearned premium reserves, ceded claims and claims adjustment expense reserve balances and ceded paid claims. These policies are intended to mitigate the risk of credit quality or dispute from becoming a danger to financial strength. To date, the Company has not experienced any material difficulties in collecting reinsurance recoverables. The below table represents activity of the ASI Pool Companies prior to being deconsolidated as of October 1, 2019. The activity for Global Liberty has not been included as a result of being classified as a discontinued operation. Premiums Written, Premiums Earned and Amounts Related to Reinsurance ($ in ‘000s) Year ended December 31, 2020 2019 Direct premiums written $ — $ 133,827 Assumed premiums written — 26,857 Ceded premiums written — (72,911) Net premiums written $ — $ 87,773 Direct premiums earned $ — $ 149,609 Assumed premiums earned — 26,954 Ceded premiums earned — (66,322) Net premiums earned $ — $ 110,241 Ceded claims and claims adjustment expenses $ — $ 31,551 Ceding commissions $ — $ 16,382 |
Claim Liabilities
Claim Liabilities | 12 Months Ended |
Dec. 31, 2020 | |
Insurance Loss Reserves [Abstract] | |
Claims Liabilities | Claims Liabilities Unpaid Claims and Claims Adjustment Expenses The below table represents activity of the ASI Pool Companies prior to being deconsolidated as of October 1, 2019. The activity for Global Liberty has not been included as a result of being classified as a discontinued operation. Changes in the Provision for Unpaid Claims and Claims Adjustment Expenses, Net of Reinsurance Recoverables ($ in ‘000s) Year ended December 31, 2020 2019 Unpaid claims and claims adjustment expenses, beginning of period $ — $ 226,487 Less: reinsurance recoverable — 55,265 Net unpaid claims and claims adjustment expenses, beginning of period — 171,222 Incurred related to: Current year — 78,612 Prior years — 2,155 — 80,767 Paid related to: Current year — 22,176 Prior years — 89,970 — 112,146 Reduction in liability from deconsolidation — 139,843 Net unpaid claims and claims adjustment expenses, end of period — — Add: reinsurance recoverable — — Unpaid claims and claims adjustment expenses, end of period $ — $ — The process of establishing the estimated provision for unpaid claims and claims adjustment expenses is complex and imprecise, as it relies on the judgment and opinions of a large number of individuals, on historical precedent and trends, on prevailing legal, economic, social and regulatory trends, and on expectations as to future developments. The process of determining the provision necessarily involves risks that the actual results may deviate, perhaps substantially, from the best estimates made. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share Based Compensation | Share-Based Compensation On January 6, 2011, Atlas adopted a stock option plan (“Stock Option Plan”) in order to advance the interests of Atlas by providing incentives to eligible persons defined in the plan. In the second quarter of 2013, a new equity incentive plan (“Equity Incentive Plan”) was approved by the Company’s common shareholders at the Annual General Meeting, and Atlas ceased to grant new stock options under the preceding Stock Option Plan. The Equity Incentive Plan is a securities based compensation plan, pursuant to which Atlas may issue restricted stock grants for ordinary voting common shares, restricted stock, stock grants for ordinary voting common shares, stock options and other forms of equity incentives to eligible persons as part of their compensation. The Equity Incentive Plan is considered an amendment and restatement of the Stock Option Plan, although outstanding stock options issued pursuant to the Stock Option Plan will continue to be governed by the terms of the Stock Option Plan. Stock Options Stock Option Activity (prices in Canadian dollars designated with “C$” and U.S. dollars designated with “US$”) Year ended December 31, 2020 2019 Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price C$ Denominated: Outstanding, beginning of period 27,195 C$6.00 27,195 C$6.00 Granted — — — — Exercised — — — — Canceled (27,195) C$6.00 — — Outstanding, end of period — $— 27,195 C$6.00 US$ Denominated: Outstanding, beginning of period 375,000 US$17.01 375,000 US$17.01 Granted — — — — Exercised — — — — Canceled (193,500) US$18.73 — — Outstanding, end of period 181,500 US$13.51 375,000 US$17.01 Options Outstanding As of December 31, 2020 Grant Date Expiration Date Number Outstanding Number Exercisable March 6, 2014 March 6, 2024 175,000 — March 12, 2015 March 12, 2025 6,500 — Total 181,500 — There are no stock options that are exercisable as of December 31, 2020. The stock option grants outstanding have a weighted average remaining life of 3.22 years and have an intrinsic value of $0 as of December 31, 2020. On December 31, 2018, the Company awarded restricted stock unit grants for ordinary voting common shares of the Company to its external directors pursuant to a director equity award agreement dated December 31, 2018. The awards, which were approved by the Company’s Board of Directors in March 2018, were valued at $40,000 per external director (“Aggregate Award”) and were made under the Company’s Equity Incentive Plan. The number of restricted stock units awarded was determined by dividing (A) the Aggregate Award by (B) the closing price of a Company ordinary voting common share at the close of market on April 4, 2018, which was $10.50 per share. For new directors, the Aggregate Award is proportionate to the director’s start date and priced as of that same day. During 2018, the Company awarded 17,524 RSU grants having an aggregate grant date fair value of $179,000. The RSUs will vest 33.3% on January 1 of each year with the last vesting period of January 1, 2021. On March 12, 2015, the Board of Directors of Atlas granted equity awards of (i) 200,000 restricted stock grants for ordinary voting common shares of the Company and (ii) 200,000 options to acquire ordinary voting common shares to the executive officers of the Company as part of the Company’s annual compensation process. The awards were made under the Company’s Equity Incentive Plan. The awards vest in five equal annual installments of 20%, provided that an installment shall not vest unless an annual performance target based on specific book value growth rates linked to return on equity goals is met. In the event the performance target is not met in any year, the 20% installment for such year shall not vest, but such non-vested installment shall carry forward and can become vested in future years (up to the fifth year from the date of grant), subject to achievement in a future year of the applicable performance target for such year. During 2020, 140,000 of the option awards were canceled as a result of not meeting the annual performance targets and an additional 53,500 options were canceled due to the departure of a former officer. During 2020 or 2019, no shares of either the restricted stock grants for ordinary voting common shares or the options to acquire ordinary voting common shares vested, due to not meeting annual performance targets. The Monte-Carlo simulation model was used, for both the options and restricted stock grants for ordinary voting common shares, to estimate the fair value of compensation expense as a result of the performance based component of these grants. Utilizing the Monte-Carlo simulation model, the fair values were $1.5 million and $1.9 million for the options and restricted stock grants for ordinary voting common shares, respectively. This expense was amortized over the anticipated vesting period. Restricted Shares Restricted Stock Grants for Ordinary Voting Common Shares and Restricted Share Unit Activity Year ended December 31, 2020 2019 Number of Shares Weighted Average Fair Value at Grant Date Number of Shares Weighted Average Fair Value at Grant Date Non-vested, beginning of period 171,682 $ 17.46 207,156 $ 16.50 Granted — — — — Vested (8,381) 10.22 (28,066) 11.79 Canceled (160,000) 9.62 (7,408) 12.20 Non-vested, end of period 3,301 $ 10.22 171,682 $ 17.46 During 2020, 140,000 ordinary voting restricted common shares were canceled as a result of not meeting annual performance targets and an additional 20,000 restricted common shares were canceled due to the departure of a former officer. Also during 2020, 2,540 restricted share units vested related to the retirement of two former directors. During 2019, 7,408 restricted share units related to a February 2014 grant to an independent director were canceled at such director’s request. |
Other Employee Benefit Plans
Other Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2020 | |
Other Employee Benefit Plans [Abstract] | |
Other Employee Benefit Plans | Other Employee Benefit Plans Defined Contribution Plan Atlas has a defined contribution 401(k) plan covering all qualified employees of Atlas and its subsidiaries. Contributions to this plan are limited based on IRS guidelines. Atlas matches 100% of the employee contribution up to 2.5% of annual earnings, plus 50% of additional contributions up to 2.5% of annual earnings, for a total maximum expense of 3.75% of annual earnings per participant. Atlas’ matching contributions are discretionary. Employees are 100% vested in their own contributions and vest in Atlas contributions based on years of service equally over 5 years with 100% vested after 5 years. Company contributions were $77,000 and $386,000 and in 2020 and 2019, respectively. The matching portion of this plan was suspended during the third quarter of 2020. Employee Stock Purchase Plan |
Share Capital, Warrants and Mez
Share Capital, Warrants and Mezzanine Equity | 12 Months Ended |
Dec. 31, 2020 | |
Share Capital and Mezzanine Equity [Abstract] | |
Share Capital, Warrants and Mezzanine Equity | Share Capital, Warrants and Mezzanine Equity Share Capital Share Capital Activity As of December 31, 2020 2019 Shares Authorized Shares Issued Shares Outstanding Amount ($ in ‘000s) Shares Issued Shares Outstanding Amount ($ in ‘000s) Ordinary voting common shares 266,666,667 12,248,798 11,993,293 $ 37 12,198,319 11,942,812 $ 36 Restricted voting common shares 33,333,334 — — — — — — Total common shares 300,000,001 12,248,798 11,993,293 $ 37 12,198,319 11,942,812 $ 36 There were 3,301 and 11,682 non-vested RSUs as of December 31, 2020 and 2019, respectively. These RSUs are participative and are included in the computations of earnings per common share and book value per common share for these periods. During 2020, the Company issued 210,481 ordinary voting common shares of which 202,100 ordinary voting common shares were issued under the near term incentive program while 8,381 ordinary voting common shares were issued as a result of the vesting of RSUs. Also, during the first quarter of 2020, 140,000 ordinary voting restricted common shares were canceled due to not meeting performance targets, and 20,000 ordinary voting restricted common shares were canceled due to the departure of a former officer. During 2019, the Company issued 5,842 ordinary voting common shares as a result of the vesting of RSUs. Warrants The Schedule 13G/A filed by American Financial Group, Inc., a parent holding company, on February 2, 2021 states that as of December 31, 2020 it has sole voting power to vote 2,387,368 ordinary voting common shares and sole power to dispose of 2,387,368 ordinary voting common shares. These shares are represented by warrants to purchase 2,387,368 ordinary voting common shares until June 10, 2024, under a Warrant Agreement dated June 10, 2019 (the “Warrant Agreement”), at an initial exercise price of $0.69 per share, with both the number of ordinary voting common shares subject to the Warrant Agreement and the exercise price subject to adjustment as set forth in the Warrant Agreement. Atlas did not declare or pay any dividends to its common shareholders during 2020 or 2019. |
Deferred Policy Acquisition Cos
Deferred Policy Acquisition Costs | 12 Months Ended |
Dec. 31, 2020 | |
Deferred Policy Acquisition Costs [Abstract] | |
Deferred Policy Acquisition Costs | Deferred Policy Acquisition Costs DPAC represent those costs that are incremental and directly related to the successful acquisition of new or renewal written premium. Such DPAC generally includes agent commissions, premium taxes and a portion of employee compensation and benefits directly related to time spent performing specific acquisition or renewal activities. The method followed in determining the DPAC limits the deferral to its realizable value by giving consideration to estimated future claims and expenses to be incurred as premiums are earned. Changes in estimates, if any, are recorded in the accounting period in which they are determined. Anticipated investment income is included in determining the realizable value of the DPAC. Atlas’ DPAC are reported net of deferred ceding commissions. Policy acquisition costs are deferred and amortized over the period in which the related premiums written are earned, typically 12 months. The below table represents activity of the ASI Pool Companies prior to being deconsolidated as of October 1, 2019. The activity for Global Liberty has not been included as a result of being classified as a discontinued operation Components of Deferred Policy Acquisition Costs ($ in ‘000s) Year ended December 31, 2020 2019 Balance, beginning of period $ — $ 5,918 Acquisition costs deferred — 24,563 Amortization charged to income — (11,825) Reduction of acquisition costs from deconsolidation of ASI Pool Companies — (18,656) Balance, end of period $ — $ — |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases We currently lease real estate space, automobiles, and certain equipment under non-cancelable operating lease agreements. Leases with an initial term of 12 months or less, which are immaterial to the Company, are not recorded in the condensed consolidated statement of financial position. The Company has elected the practical expedient to account for each separate lease component of a contract and its associated non-lease components as a single lease component, thus causing all fixed payments to be capitalized. The Company also elected the package of practical expedients permitted within the new standard, which among other things, allows the Company to carry forward historical lease classification. Variable lease payment amounts that cannot be determined at the commencement of the lease, such as increases to lease payments based on changes in index rates or usage, are not recorded in the condensed consolidated statement of financial position. Certain agreements include an option to extend or renew the lease term at our option. The operating lease liability includes lease payments related to options to extend or renew the lease term if the Company is reasonably certain of exercising those options. Lease payments are discounted using the implicit discount rate in the lease. If the implicit discount rate for the lease cannot be readily determined, the Company uses an estimate of its incremental borrowing rate. The Company did not have any contracts accounted for as finance leases as of December 31, 2020 or 2019. Lease Expense ($ in ‘000s) 2020 2019 Operating leases $ 752 $ 904 Variable lease cost 358 332 Total $ 1,110 $ 1,236 Other Operating Lease Information ($ in ‘000s) 2020 2019 Cash paid for amounts included in the measurement of lease liabilities reported in operating cash flows $ 1,109 $ 1,237 Right-of-use assets obtained in exchange for new lease liabilities — 31 Total $ 1,109 $ 1,268 The following table presents the undiscounted contractual maturities of the Company’s operating lease liability at December 31, 2020: Contractual Operating Lease Liabilities ($ in ‘000s) 2021 $ 892 2022 179 2023 23 Total lease payments $ 1,094 Impact of discounting (3) Operating lease liability $ 1,091 Supplemental Balance Sheet Disclosures ($ in ‘000s) Lease Component Balance Sheet Classification As of December 31, 2020 Lease right-of-use asset Right-of-use asset $ 888 Weighted-average remaining lease term 1.2 years Weighted-average discount rate 3.5 % |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party TransactionsSee ‘Item 13, Certain Relationships and Related Transactions, and Director Independence ” for disclosure regarding the Company’s related party transactions. |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Notes Payable | Notes Payable On April 26, 2017, Atlas issued $25 million of five The senior unsecured notes were issued under an indenture and supplemental indenture that contain covenants that, among other things, limit: (i) the ability of Atlas to merge or consolidate, or lease, sell, assign or transfer all or substantially all of its assets; (ii) the ability of Atlas to sell or otherwise dispose of the equity securities of certain of its subsidiaries; (iii) the ability of certain of Atlas’ subsidiaries to issue equity securities; (iv) the ability of Atlas to permit certain of its subsidiaries to merge or consolidate, or lease, sell, assign or transfer all or substantially all of their respective assets; and (v) the ability of Atlas and its subsidiaries to incur debt secured by equity securities of certain of its subsidiaries. On November 10, 2016, American Acquisition entered into a ten On May 1, 2020, American Acquisition entered into a Paycheck Protection Program Promissory Note (the "PPP Note") with respect to a loan of $4,600,500 (the "PPP Loan") from Fifth Third Bank, National Association. The PPP Loan was obtained pursuant to the Paycheck Protection Program (the "PPP") of the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") administered by the U.S. Small Business Administration ("SBA"). The PPP Loan matures on May 1, 2022 and bears interest at a rate of 1.0% per annum. The PPP Loan is payable in 18 equal monthly payments of $257,611.48 which was to commence December 1, 2020. The PPP Loan may be prepaid at any time prior to maturity with no prepayment penalties. American Acquisition has applied for loan forgiveness pursuant to the terms of the PPP as certain of the criteria have been met and is awaiting the results of the forgiveness decision, and as a result, monthly payments will be deferred until final resolution of the forgiveness application process. Interest expense on notes payable was $2.3 million and $2.0 million in 2020 and 2019, respectively. Notes Payable Outstanding ($ in ‘000s) As of December 31, 2020 2019 6.625% Senior Unsecured Notes due April 26, 2022 $ 25,000 $ 25,000 1.0% PPP Loan due May 1, 2022 4,601 — 5.0% Mortgage due November 10, 2026 6,863 7,621 Total outstanding borrowings 36,464 32,621 Unamortized issuance costs (296) (521) Total notes payable $ 36,168 $ 32,100 |
Deconsolidation and Discontinue
Deconsolidation and Discontinued Operations | 12 Months Ended |
Dec. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Deconsolidation and Discontinued Operations | Deconsolidation and Discontinued Operations Deconsolidation Effective October 1, 2019, Atlas no longer has statutory responsibility or authority over the financial activities of the ASI Pool Companies while still maintaining their indirect ownership of the ASI Pool Companies. This resulted in the ASI Pool Companies being classified as variable interest entities for which the Company is no longer the primary beneficiary, and they were deconsolidated during the fourth quarter of 2019. The Company recognized a loss of $4.4 million relating to the deconsolidation during the year ended December 31, 2019, which was the remaining equity of the ASI Pool Companies as of the deconsolidation date. The financial results of the ASI Pool Companies are included in the consolidated statements of operations through the October 1, 2019 disposal date. There was not re-measurement of any retained interest since no future value was assigned to the deconsolidated entities as a result of the rehabilitation. Management intends to continue supporting the administrative activities of the ASI Pool Companies as required by the Office of the Special Deputy Receiver of the Illinois Department of Insurance (“OSD”); but will have no control over the financial activities of these entities. As part of the deconsolidation, notes receivable from the estates of the ASI Pool Companies with outstanding principal and accrued interest balances of $18.0 million are now presented on the Consolidated Statements of Financial Position. On May 1, 2015, American Acquisition entered into subordinated surplus debentures (“Surplus Notes”) with the ASI Pool Companies that had a maturity date of April 30, 2020 carrying a variable interest equal to the corporate base rate as reported by the largest bank (measured in assets) with its head office located in Chicago, Illinois, in effect on the first business day of each month for the term of the Surplus Notes plus two percent per annum on the unpaid principal balance with a maximum variable interest rate for any month not to exceed the initial rate for the Surplus Notes by more than ten percent per annum. These Surplus Notes are subject to various terms and conditions as set forth by the Illinois Department of Insurance and require prior written approval for the payment of interest and/or the reduction in principal. These Surplus Notes could be used at some point to offset future amounts payable related to income tax settlements and various other intercompany settlements to the estates of the ASI Pool Companies. Discontinued Operations During the fourth quarter of 2019, the Company began actively pursuing the potential sale of Global Liberty, and as a result, Global Liberty has been classified as a discontinued operation and the results of Global Liberty’s operations are reported separately for all periods presented. Global Liberty has not been sold within the one year guidance as set forth by ASC 205-20-45-1E(d) to continue classifying Global Liberty as a discontinued operation. However, due to the confluence of events and circumstances beyond the Company’s control, ASC 205-20-45-1G(c) provides for an exception to the one year guidance which the Company believes fits its situation. As a result of the Company applying the exception guidance, Global Liberty remains as a discontinued operation as of December 31, 2020. The Company continues to move forward with the plans of selling Global Liberty pending certain regulatory and other matters occur prior to such sale. Summary financial information for Global Liberty included in income (loss) from discontinued operations, net of tax in the consolidated statements of operations for the years ended December 31, 2020 and 2019 is presented below: Income (loss) From Discontinued Operations ($ in ‘000s) Year ended December 31, 2020 2019 Net premiums earned $ 13,908 $ 27,862 Net investment (loss) income (102) 437 Net realized losses (1,411) (9) Total revenue 12,395 28,290 Net claims incurred 689 25,833 Acquisition costs 6,875 5,467 Other underwriting expenses 5,117 4,504 Interest (income) (2) (87) Total expenses 12,679 35,717 Loss from operations before income taxes (284) (7,427) Income tax (benefit) (522) — Net income (loss) $ 238 $ (7,427) Statements of Comprehensive Income (Loss) Net income (loss) $ 238 $ (7,427) Other comprehensive income: Changes in net unrealized investment gains 161 634 Reclassification to net income (loss) (155) 547 Other comprehensive income 6 1,181 Total comprehensive income (loss) $ 244 $ (6,246) The assets and liabilities of Global Liberty are presented as held for sale in the consolidated statements of financial position at December 31, 2020 and 2019 is presented below: ($ in ‘000s) December 31, 2020 2019 Assets Investments Fixed income securities, available for sale, at fair value (amortized cost $4,315 and $14,016) $ 4,544 $ 14,239 Short-term investments, at cost — 491 Other investments 1,319 1,315 Total investments 5,863 16,045 Cash and cash equivalents 3,029 7,712 Accrued investment income 29 78 Reinsurance recoverables on amounts paid 581 2,227 Reinsurance recoverables on amounts unpaid 31,958 18,339 Prepaid reinsurance premiums 9,739 3,765 Deferred policy acquisition costs 637 534 Property and equipment, net — 1,741 Other assets 2,049 861 Total assets $ 53,885 $ 51,302 Liabilities Claims liabilities $ 38,499 $ 46,771 Unearned premium reserves 14,545 12,423 Due to reinsurers 10 1,019 Other liabilities and accrued expenses 7,353 2,554 Total liabilities $ 60,407 $ 62,767 |
Organization, Consolidation and
Organization, Consolidation and Presentation of Financial Statements | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | Going Concern Under Accounting Standards Codification (“ASC”) 205-40 Going Concern, we have the responsibility to evaluate whether conditions and/or events raise substantial doubt about our ability to meet our future financial obligations as they become due within one year after the date that the consolidated financial statements are issued. As required by this standard, our evaluation shall initially not take into consideration the potential mitigating effects of our plans that have not been fully implemented as of the date the consolidated financial statements are issued. In complying with the requirements under ASC 205-40 to complete an evaluation without considering mitigating factors, the Company considered several conditions or events including (1) uncertainty around the continued impact of the COVID-19 pandemic on the Company’s operations and consolidated financial results, (2) the $25 million of Senior Unsecured Notes maturing on April 26, 2022, (3) recurring operating losses for fiscal periods through December 31, 2020, (4) the Company’s negative equity, and (5) the Company’s working capital limitations. The above conditions raise substantial doubt about the Company’s ability to continue as a going concern for the 12-month period following the date the fiscal year 2020 consolidated financial statements are issued. In performing the second step of this assessment, we are required to evaluate whether our plans to mitigate the conditions above alleviate the substantial doubt about our ability to meet our obligations as they become due within one year after the date that the consolidated financial statements are issued. Our future plans may potentially include, without limitation, one or more of the following: (1) securing incremental capital with the objective of potentially repurchasing some or all of the Senior Unsecured Notes at a discount to par, in the open market or otherwise, (2) securing equity or debt capital in private or public transactions, or (3) offering to exchange some or all of the Senior Unsecured Notes for debt, equity and/or other securities or other consideration, through privately negotiated transactions or otherwise. The constraints and requirements related to the Company’s current senior notes coupled with market conditions could create limitations with respect to such alternatives. Management believes that the Company’s capital requirements will depend on many factors including the success of the Company’s business development efforts. Management also believes the Company may need to raise additional capital for working capital purposes There is no assurance that such financing will be available in the future. The conditions described above raise substantial doubt about our ability to continue as a going concern. The consolidated financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. There is no assurance that sufficient funds required during the next year or thereafter will be generated from operations or that funds will be available through external sources. The lack of additional capital resulting from the inability to generate cash flow from operations or to raise capital from external sources would force the Company to substantially curtail or cease operations and would, therefore, have a material effect on the business. Furthermore, there can be no assurance that any such required funds, if available, will be available on attractive terms or they will not have a significant dilutive effect on the Company’s existing shareholders. In the absence of the successful execution of one or more of the Company’s previously mentioned mitigating actions, we have therefore concluded there is substantial doubt about our ability to continue as a going concern through or beyond April 2022. The accompanying consolidated financial statements have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The accompanying consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from our failure to continue as a going concern. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On February 7, 2021, American Acquisition entered into a Paycheck Protection Program promissory note with respect to a loan of $2,000,000 (the “Second PPP Loan”) from Fifth Third Bank, National Association (“Fifth Third”). The Second PPP Loan was obtained pursuant to the SBA’s Paycheck Protection Program Second Draw Loans under the Small Business Act (“SB Act”) and is subject to the terms and conditions of the SB Act, the CARES Act and related legislation and regulations (the “PPP Rules”). The Company was eligible for this Second PPP Loan because our equity securities are not a National Markets System stock traded on a national securities exchange as defined by Section 6 of the Securities Exchange Act of 1934. The Second PPP Loan matures on February 7, 2026 and bears interest at a rate of 1.00% per annum. The Company will not be obligated to make any payments of principal or interest if the Company submits a loan forgiveness application to Fifth Third within 10 months after the end of the Company’s covered loan forgiveness period (as defined and interpreted by the PPP Rules) and such loan forgiveness is allowed. If the Company does not submit a loan forgiveness application within 10 months after the end of the Company’s loan forgiveness covered period (and such forgiveness is not allowed), the Company must begin paying principal and interest after that period (or after notice that such forgiveness is not allowed). The Company’s Current Report on Form 8-K since December 31, 2020 provides more detailed disclosures regarding the above event. |
Schedule II - Condensed Financi
Schedule II - Condensed Financial Information of Registrant | 12 Months Ended |
Dec. 31, 2020 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule II - Condensed Financial Information of Registrant | Schedule II – Condensed Financial Information of Registrant Statements of Operations ($ in ‘000s) Year ended December 31, 2020 2019 Net investment income (expense) $ — $ (6) Other underwriting expense (4,469) (6,254) Interest expense (1,856) (1,897) Loss from operations before income taxes (6,325) (8,157) Income tax expense (benefit) 905 (392) Loss before equity in net loss of subsidiaries $ (7,230) $ (7,765) Equity in net loss of subsidiaries (5,500) (12,661) Net loss $ (12,730) $ (20,426) Other comprehensive income: Changes in net unrealized investment gains 161 1,917 Reclassification to net (loss) income (155) 2,243 Other comprehensive income 6 4,160 Total comprehensive loss $ (12,724) $ (16,266) Statements of Financial Position ($ in ‘000s, except share and per share data) December 31, 2020 2019 Assets Cash and cash equivalents $ 1,106 $ 1,966 Investment in subsidiaries 24,889 28,782 Total Assets $ 26,688 $ 30,748 Liabilities Notes payable, net $ 24,704 $ 24,479 Other liabilities and accrued expenses 22,876 14,730 Total Liabilities $ 47,580 $ 39,209 Shareholders’ Equity Ordinary voting common shares, $0.003 par value, 266,666,667 shares authorized, shares issued: December 31, 2020 - 12,248,798 and December 31, 2019 12,198,319; shares outstanding: December 31, 2020 - 11,993,293 and December 31, 2019 - 11,942,812 $ 37 $ 36 Restricted voting common shares, $0.003 par value, 33,333,334 shares authorized, shares issued and outstanding: December 31, 2020 and December 31, 2019 - 0 — — Additional paid in capital 81,840 81,548 Treasury stock, at cost: 255,505 shares of ordinary common voting shares at December 31, 2020 and December 31, 2019, respectively (3,000) (3,000) Retained deficit (100,199) (87,469) Accumulated other comprehensive income, net of tax 430 424 Total Shareholders’ Equity $ (20,892) $ (8,461) Total Liabilities and Shareholders’ Equity $ 26,688 $ 30,748 See accompanying Notes to Condensed Financial Information of Registrant. Schedule II (Continued) – Condensed Financial Information of Registrant Statements of Cash Flows ($ in ‘000s) Year ended December 31, 2020 2019 Operating activities: Net loss $ (12,730) $ (20,426) Adjustments to reconcile net loss to net cash flows provided by operating activities: Equity in net loss of subsidiaries 5,500 12,661 Share-based compensation expense 292 872 Amortization of financing costs 224 224 Net changes in operating assets and liabilities: Other assets (693) — Other liabilities and accrued expenses 8,147 8,264 Net cash flows provided by operating activities 740 1,595 Financing activities: Capital contribution (1,600) — Net cash flows (used in) provided by financing activities (1,600) — Net change in cash and cash equivalents (860) 1,595 Cash and cash equivalents, beginning of year 1,966 371 Cash and cash equivalents, end of year $ 1,106 $ 1,966 Supplemental disclosure of cash paid (recovered) for: Interest $ 1,656 $ 1,656 Income taxes (801) 5,763 See accompanying Notes to Condensed Financial Information of Registrant. The financial statements of the Registrant should be read in conjunction with the Consolidated Financial Statements and notes thereto included in ‘Part II, Item 8.’ On April 26, 2017, Atlas issued $25 million of five Atlas has not received cash dividends from its subsidiaries since its inception on December 31, 2010. |
Schedule IV - Reinsurance
Schedule IV - Reinsurance | 12 Months Ended |
Dec. 31, 2020 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
Schedule IV - Reinsurance | Schedule IV – Reinsurance ($ in ‘000s) Gross Amount Ceded to Other Companies Assumed from Other Companies Net Amount % of Amount Assumed to Net Premiums Earned December 31, 2020 $ — $ — $ — $ — — % December 31, 2019 $ 149,609 $ (66,322) $ 26,954 $ 110,241 24.5 % |
Schedule V - Valuation and qual
Schedule V - Valuation and qualifying accounts | 12 Months Ended |
Dec. 31, 2020 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule V - Valuation and qualifying accounts | Schedule V – Valuation and Qualifying Accounts ($ in ‘000s) Balance at Beginning of Period Charged to Expenses Other Additions Deductions Balance at End of Period December 31, 2020 Allowance for uncollectible receivables $ 800 $ 169 $ — $ (169) $ 800 Valuation allowance for deferred tax assets 3,143 1,410 — — 4,553 December 31, 2019 Allowance for uncollectible receivables $ 5,115 $ 3,596 $ — $ (7,911) $ 800 Valuation allowance for deferred tax assets 25,415 2,113 — (24,385) 3,143 |
Schedule VI - Supplemental info
Schedule VI - Supplemental information concerning property-casualty insurance operations | 12 Months Ended |
Dec. 31, 2020 | |
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 ($ in ‘000s) Year ended December 31, 2020 2019 Net premiums earned $ — $ 110,241 Net investment income — 1,902 Claims and claims adjustment expenses incurred Current year — 78,612 Prior year — 2,155 Amortization of deferred policy acquisition costs — 11,825 Paid claims and claims adjustment expenses — 112,146 Gross premiums written — 160,684 |
Nature of Operations and Basi_2
Nature of Operations and Basis of Presentation Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation |
Principles of consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Atlas and the entities it controls. Subsidiaries are entities over which Atlas, directly or indirectly, has the power to govern the financial and operating policies in order to obtain the benefits from their activities, generally accompanying an equity shareholding of more than one half of the voting rights. Subsidiaries are fully consolidated from the date on which control is transferred to Atlas and would be deconsolidated from the date that control ceases. The operating results of subsidiaries acquired or disposed of during the year will be included in the consolidated statements of operations from the effective date of acquisition and up to the effective date of disposal, as appropriate. All significant intercompany transactions and balances are eliminated in consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by Atlas. The following are Atlas’ subsidiaries, all of which are 100% owned, either directly or indirectly, together with the jurisdiction of incorporation, that are included in consolidated financial statements: • American Insurance Acquisition Inc. (Delaware) • Anchor Group Management Inc. (New York) • Anchor Holdings Group, Inc. (New York) • Global Liberty Insurance Company of New York (New York), classified as a discontinued operation • UBI Holdings Inc. (Delaware) • optOn Digital IP Inc. (Delaware) • optOn Insurance Agency Inc. (Delaware) The following are Atlas’ subsidiaries, all of which are 100% owned, either directly or indirectly, together with the jurisdiction of incorporation, that are not included in consolidated financial statements effective October 2019, as management no longer has direct financial control over the estates of these entities: • American Country Insurance Company (Illinois) • American Service Insurance Company, Inc. (Illinois) • Gateway Insurance Company (Illinois) |
Estimates and assumptions | Estimates and Assumptions The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates, and changes in estimates are recorded in the accounting period in which they are determined. Significant estimates in the accompanying financial statements include revenue recognition, fair value of financial instruments, evaluation of assets for impairment, deferred policy acquisition cost recoverability and deferred tax asset valuation. |
Investments | Investment Income and Realized Gains (Losses) For securities other than mortgage-backed and asset-backed, Atlas utilizes the effective interest method to calculate the amortized cost of the financial asset and to amortize the premium or accrete the discount over the remaining life. The effective interest rate is the rate that discounts the estimated future cash flows through the expected life of the financial instrument. Mortgage-backed and asset-backed securities are valued using the retrospective adjustment method, which uses the effective interest method and includes anticipated prepayments. Interest income is reported net of amortization of premium and accretion of discount. Realized gains and losses on disposition of available-for-sale securities are based on the net proceeds and the adjusted cost of the securities sold using the specific identification method. Investments Investments in fixed income are classified as available-for-sale. Securities are classified as available-for-sale when Atlas may decide to sell those securities due to changes in market interest rates, liquidity needs, changes in yields or alternative investments, and for other reasons. Available-for-sale securities are carried at fair value, with unrealized gains and losses, net of income taxes, included as a separate component of accumulated other comprehensive (loss) income in shareholders’ equity. |
Cash, and cash equivalents, and short-term investments | Cash and Cash Equivalents Cash and cash equivalents include cash and highly liquid securities with original maturities of 90 days or less. Short-Term Investments Short-term investments consist of investments with original maturities between three months and one year and are reported at cost, which approximates fair value. |
Cash and cash equivalents, restricted cash | Cash and Cash Equivalents Cash and cash equivalents include cash and highly liquid securities with original maturities of 90 days or less. Short-Term Investments Short-term investments consist of investments with original maturities between three months and one year and are reported at cost, which approximates fair value. |
Fair values of financial instruments | Fair Values of Financial Instruments Atlas has used the following methods and assumptions in estimating its fair value disclosures: Fair values for investments are based on quoted market prices, when available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments or values obtained from independent pricing services. Atlas’ fixed income portfolio is managed by a Securities and Exchange Commission (“SEC”) registered investment adviser specializing in the management of insurance company portfolios. Management works directly with them to ensure that Atlas benefits from their expertise and also evaluates investments as well as specific positions independently using internal resources. Atlas’ investment adviser has a team of credit analysts for all investment grade fixed income sectors. The investment process begins with an independent analyst review of each security’s credit worthiness using both quantitative tools and qualitative review. At the issuer level, this includes reviews of past financial data, trends in financial stability, projections for the future, reliability of the management team in place and market data (credit spread, equity prices, trends in this data for the issuer and the issuer’s industry). Reviews also consider industry trends and the macro-economic environment. This analysis is continuous, integrating new information as it becomes available. As of December 31, 2020, this process did not generate any significant difference in the rating assessment between Atlas’ review and the rating agencies. Atlas employs specific control processes to determine the reasonableness of the fair value of its financial assets. These processes are designed to supplement those performed by Atlas’ investment adviser to ensure that the values received from them are accurately recorded and that the data inputs and the valuation techniques utilized are appropriate, consistently applied, and that the assumptions are reasonable and consistent with the objective of determining fair value. For example, on a continuing basis, Atlas assesses the reasonableness of individual security values that have stale prices or whose changes exceed certain thresholds as compared to previous values received from Atlas’ investment adviser or to expected prices. The portfolio is reviewed routinely for transaction volumes, new issuances, any changes in spreads, as well as the overall movement of interest rates along the yield curve to determine if sufficient activity and liquidity exists to provide a credible source for market valuations. When fair value determinations are expected to be more variable, they are validated through reviews by members of management or the Board of Directors who have relevant expertise and who are independent of those charged with executing investment transactions. Atlas employs a fair value hierarchy to categorize the inputs it uses in valuation techniques to measure the fair value. The hierarchy is comprised of quoted prices in active markets (Level 1), third party pricing models using available trade, bid and market information (Level 2), and internal models without observable market information (Level 3). The Company recognizes transfers between levels of the fair value hierarchy at the end of the period in which events occur impacting the availability of inputs to the fair value methodology. |
Premiums receivable | Premiums Receivable Premiums receivable include premium balances due and uncollected and installment premiums not yet due from agents and insureds. Atlas evaluates the collectability of accounts receivable based on a combination of factors. When aware of a specific customer’s inability to meet its financial obligations, such as in the case of bankruptcy or deterioration in the customer’s operating results |
Deferred policy acquisition costs | Deferred Policy Acquisition Costs Atlas incurs costs to fulfill a contract (or anticipated contract) with a client. Those costs are incurred prior to the effective date of the contract and relate to fulfilling our primary placement obligations to our clients. Our costs to fulfill prior to the effective date are capitalized and amortized on the effective date. These fulfillment activities include collecting underwriting information and negotiating their placement with an insurance carrier. The majority of costs that we incur relate to compensation and benefits of our underwriting staff. Costs incurred during preplacement activities are expected to be recovered in the future. If the capitalized costs are no longer deemed to be recoverable, then they would be expensed. |
Income taxes | Income Taxes Income tax expense includes all taxes based on taxable income or loss of Atlas and its subsidiaries, and is recognized in the statements of operations except to the extent that they relate to items recognized directly in other comprehensive income, in which case the income tax effect is also recognized in other comprehensive income or loss. Deferred taxes are recognized based on the differences in the tax basis of assets, liabilities and items recognized directly in equity and the financial reporting basis of such items. Deferred tax assets are recognized only to the extent that it is probable that future taxable income will be available against which they can be utilized. Deferred tax assets and liabilities (“DTAs” and “DTLs”) are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period of enactment. When considering the extent of the valuation allowance on Atlas’ DTAs, weight is given by management to both positive and negative evidence. U.S. GAAP states that a cumulative loss in recent years is a significant piece of negative evidence that is difficult to overcome in determining that a valuation allowance is not needed against DTAs. However, the strength and trend of earnings, as well as other relevant factors are considered. Atlas accounts for uncertain tax positions in accordance with the income taxes accounting guidance. Atlas analyzes filing positions in the federal and state jurisdiction where it is required to file tax returns, as well as the open tax years in these jurisdictions. Atlas would recognize interest and penalties related to unrecognized tax benefits as a component of the provision for federal income taxes. |
Intangible assets | Intangible Assets Atlas recognized intangible assets as part of the acquisitions of Gateway and Anchor Holdings Group, Inc. The intangible assets are classified as either indefinite-lived or definite-lived depending on whether the useful lives can be identified. Atlas indefinite-lived intangible assets consisted of state insurance licenses, and these intangible assets are reviewed for impairment at least annually. Definite-lived intangible assets are amortized over their useful lives on a straight-line basis except for customer related intangibles, which are on an accelerated basis. Atlas definite-lived intangible assets consist of trade names and trademarks with useful lives of 15 years and customer relationships with useful lives of 10 years. The intangible assets are reviewed for impairment at least annually. |
Property and equipment | Property and Equipment Buildings, office equipment and internal use software are stated at historical cost less depreciation and amortization. Subsequent costs are included in the asset’s carrying amount or capitalized as a separate asset only when it is probable that future economic benefits will be realized. Land is stated at historical cost. Internal use software includes costs associated with the Company’s policy and claims system including costs to develop those systems. Costs incurred during the preliminary project stage are expensed as incurred; costs incurred for activities during the application development stage are capitalized; and costs incurred during the post-implementation/operation stage are expensed as incurred. Upon reaching the post-implementation/operation stage of the development of internal use software, the capitalized costs are amortized over the estimated useful life of the asset. Depreciation on buildings and building improvements are provided on a straight-line basis over the estimated useful life of 33 years for buildings and 10 years for building improvements. Depreciation and amortization on equipment and internal use software is provided on a straight-line basis over the estimated useful lives which range from 5 years for vehicles, 5 years for |
Insurance contracts | Insurance Contracts Contracts under which Atlas’ Insurance Subsidiaries accept risk at the inception of the contract from another party (the insured holder of the policy) by agreeing to compensate the policyholder or other insured beneficiary if a specified future event (the insured event) adversely affects the holder of the policy are classified as insurance contracts. All policies are short-duration contracts. |
Revenue recognition | Revenue Recognition Revenues from contracts with customers include both commission and fee income. The recognition and measurement of revenue is based on the assessments of individual contract terms. As an MGA, AGMI has contracts with various insurance carriers which determines AGMI’s commission income revenue. Each contract specifies what our performance obligations are as an MGA and what determines our commission income revenue, generally gross written premiums, net of cancellations and refunds. Under these contracts there are a number of performance obligations; however, it is the bundle of these services and not a single obligation that results in the performance of the MGA under the contracts. The Company considers these performance obligations as a non-bifurcated bundle of services where the performance obligations are satisfied simultaneous to the point in time where AGMI issues a policy, or cancels a policy to an insured. The commission rate stated in the individual contract is the standalone selling price of these non-bifurcated services which is allocated to the service bundle and not to any individual obligation under the various contracts. |
Claims liabilities | Claims Liabilities The provision for unpaid claims represents the estimated liabilities for reported claims reported prior to the close of the accounting period, estimates for unreported claims based on industry data and actuarial estimates, plus related estimated claim adjustment expenses based on the experience of the Company. Unpaid claim adjustment expenses are determined using case-basis evaluations and statistical analyses, including insurance industry claims data, and represent estimates of the ultimate cost of all claims incurred. The amount of uncertainty in the estimates is significantly affected by such factors as the amount of claims experience relative to the development period, knowledge of the actual facts and circumstances and the amount of insurance risk retained. The actuarial methods for making estimates for unpaid claims and for establishing the ultimate liability are periodically reviewed, and any adjustments are reflected in current operations. |
Reinsurance | Reinsurance As part of Atlas’ insurance risk management policies, portions of its insurance risk is ceded to reinsurers. Reinsurance premiums and claims expenses are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts. Premiums and claims ceded to other companies have been reported as a reduction of premium revenue and claims incurred. Commissions paid to Atlas by reinsurers on business ceded have been accounted for as a reduction of the related policy acquisition costs. Reinsurance recoverables are recorded for that portion of paid and unpaid claims and claims adjustment expenses that are ceded to other companies. Prepaid reinsurance premiums are recorded for unearned premiums that have been ceded to other companies. |
Share-based payments | Share-Based Compensation Atlas |
Operating segments | Operating Segments |
Reclassifications | Reclassifications Certain accounts in the prior years’ consolidated financial statement have been reclassified for comparative purposes to conform to the current year’s presentation. |
New accounting standards | All recently issued accounting pronouncements with effective dates prior to January 1, 2021 have been adopted by the Company. Recently Adopted Leases In March 2019, December 2018, July 2018 and February 2016, the FASB issued ASI 2019-01 Leases (Topic 842) Codification Improvements, ASU 2018-20 Leases (Topic 842) Narrow-Scope Improvements for Lessors, ASU 2018-11 Leases (Topic 842): Targeted Improvements and ASU 2018-10 Codification Improvements to Topic 842, Leases and ASU 2016-02, Leases (Topic 842), respectively. The provisions of these updates impact the classification criteria, disclosure requirements, and other specific transactions in lease accounting. The updates require either the use of a modified retrospective approach, which requires leases to be measured at the beginning of the earliest period presented, or the transition method, which requires entities to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company adopted the updates on January 1, 2019 using the transition method with no change to comparative periods. See Note 16, Leases, for further discussion of future lease commitments. The adoption of these updates resulted in the recognition of both a right-of-use asset and lease liability in the amounts of approximately $2.5 million and $3.1 million, respectively. There was no impact to any of Atlas’ current financial covenants as a result of the increase to reported liabilities. Premium Amortization on Purchased Callable Debt Securities In March 2017, the FASB issued ASU 2017-08, Receivables-Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. This guidance shortens the amortization period to the earliest call date for certain purchased callable debt securities held at a premium that have explicit, noncontingent call features and are callable at a fixed price and preset date. For public entities, this guidance is effective for years beginning after December 31, 2018, including interim periods within those years. The Company adopted the update on January 1, 2019 with no impact on the Company’s consolidated financial statements because Global Liberty’s callable debt securities, that are held at a premium, are amortized to the earliest call date, which is consistent with current accounting treatment. All other recently issued pronouncements with effective dates after December 31, 2020 are not expected to have a material impact on the consolidated financial statements. |
Intangible Assets Intangible As
Intangible Assets Intangible Assets by Major Asset Class (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Indefinite-Lived Intangible Assets | Intangible Assets by Major Asset Class ($ in ‘000s) Economic Useful Life Gross Carrying Amount Accumulated Amortization Net As of December 31, 2020 Trade name and trademark 15 years $ 1,800 $ 703 $ 1,097 Customer relationship 10 years 2,700 1,562 1,138 $ 4,500 $ 2,265 $ 2,235 As of December 31, 2019 Trade name and trademark 15 years $ 1,800 $ 581 $ 1,219 Customer relationship 10 years 2,700 1,294 1,406 $ 4,500 $ 1,875 $ 2,625 |
Schedule of Finite-Lived Intangible Assets | Intangible Assets by Major Asset Class ($ in ‘000s) Economic Useful Life Gross Carrying Amount Accumulated Amortization Net As of December 31, 2020 Trade name and trademark 15 years $ 1,800 $ 703 $ 1,097 Customer relationship 10 years 2,700 1,562 1,138 $ 4,500 $ 2,265 $ 2,235 As of December 31, 2019 Trade name and trademark 15 years $ 1,800 $ 581 $ 1,219 Customer relationship 10 years 2,700 1,294 1,406 $ 4,500 $ 1,875 $ 2,625 |
Loss From Continuing Operatio_2
Loss From Continuing Operations per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Common Shares, Basic and Diluted | Computations of Basic and Diluted Loss per Common Share from Continuing Operations ($ in ‘000s, except share and per share amounts) Year ended December 31, 2020 2019 Basic Loss from continuing operations before income taxes $ (13,452) $ (12,776) Income tax (benefit) expense (484) 223 Net loss attributable to common shareholders from continuing operations $ (12,968) $ (12,999) Basic weighted average common shares outstanding 11,957,268 11,954,494 Loss per common share basic from continuing operations $ (1.08) $ (1.09) Diluted Basic weighted average common shares outstanding 11,957,268 11,954,494 Dilutive potential ordinary shares: Dilutive stock options outstanding — — Diluted weighted average common shares outstanding 11,957,268 11,954,494 Loss per common share diluted from continuing operations $ (1.08) $ (1.09) |
Contracts with Customers (Table
Contracts with Customers (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable | The balance of receivables related to contracts with customers, which is recorded as part of premiums receivable on the Consolidated Statements of Financial Position as of December 31, 2020 and 2019: Components of Commission Receivables ($ in ‘000s) Year ended December 31, 2020 2019 Commission receivable, beginning of year $ 1,428 $ — Commission revenue 5,195 7,458 Net change in cash received (4,046) (6,030) Commission receivable, end of year $ 2,577 $ 1,428 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Investments [Abstract] | |
Summary of the Components of Net Investment Income | Components of Net Investment Income ($ in ‘000s) Year ended December 31, 2020 2019 Total investment income Interest income $ — $ 1,877 Income from other investments — 793 Investment expenses — (768) Net investment income $ — $ 1,902 |
Schedule of Realized Gain (Loss) | Aggregate Proceeds and Gross Realized Investment Gains and Losses ($ in ‘000s) Year ended December 31, 2020 2019 Fixed income securities: Proceeds from sales and calls $ — $ 42,406 Gross realized investment gains — 450 Gross realized investment losses — (205) Equities: Proceeds from sales — 5,997 Gross realized investment gains — 443 Gross realized investment losses — (96) Other investments: Proceeds from sales — 3,997 Gross realized investment gains — 250 Gross realized investment losses — (21) Total: Proceeds from sales and calls $ — $ 52,400 Gross realized investment gains — 1,143 Gross realized investment losses — (322) |
Summary of the Components of Net Investment Realized Gains | Components of Net Realized Gains ($ in ‘000s) Year ended December 31, 2020 2019 Fixed income securities $ — $ 245 Equities — 347 Other investments — 229 Net realized gains $ — $ 821 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | Reconciliation of U.S. Statutory Marginal Income Tax Rate to the Effective Tax Rate - Continuing Operations ($ in ‘000s) Year ended December 31, 2020 2019 Amount % Amount % Provision for taxes at U.S. statutory marginal income tax rate $ (2,825) 21.0 % $ (2,683) 21.0 % Provision for deferred tax assets deemed unrealizable (valuation allowance) 1,744 (13.0) 2,779 (21.8) Nondeductible expenses (3) — 28 (0.2) Tax-exempt income — — (3) — State tax (net of federal benefit) (3) — 71 (0.6) Stock compensation 630 (4.7) 31 (0.2) Tax rate differential (42) 0.3 — — Other 15 (0.1) — — Provision for income taxes for continuing operations $ (484) 3.5 % $ 223 (1.8) % Reconciliation of U.S. Statutory Marginal Income Tax Rate to the Effective Tax Rate - Discontinued Operations ($ in ‘000s) Year ended December 31, 2020 2019 Amount % Amount % Provision for taxes at U.S. statutory marginal income tax rate $ (60) 21.0 % $ (1,560) 21.0 % Provision for deferred tax assets deemed unrealizable (valuation allowance) (264) 92.9 1,559 (21.0) Nondeductible expenses 2 (0.7) 3 — Tax-exempt income — — (2) — Tax rate differential (200) 70.4 — — Provision for income taxes for discontinued operations $ (522) 183.6 % $ — — % |
Schedule of Components of Income Tax Expense (Benefit) | Components of Income Tax (Benefit) Expense - Continuing Operations ($ in ‘000s) Year ended December 31, 2020 2019 Current tax (benefit) expense $ (484) $ 223 Components of Income Tax (Benefit) Expense - Discontinued Operations ($ in ‘000s) Year ended December 31, 2020 2019 Current tax (benefit) $ (522) $ — |
Schedule of Deferred Tax Assets and Liabilities | Components of Deferred Income Tax Assets and Liabilities ($ in ‘000s) December 31, 2020 2019 Gross deferred tax assets: Losses carried forward $ 16,408 $ 10,264 Claims liabilities and unearned premium reserves 496 554 Investment in affiliates 23,870 24,450 Bad debts 168 168 Stock compensation 279 873 Other 203 81 Valuation allowance (33,420) (32,522) Total gross deferred tax assets 8,004 3,868 Gross deferred tax liabilities: Deferred policy acquisition costs 134 112 Investments 122 116 Fixed assets 1,344 2,099 Intangible assets 469 551 Other 5,935 990 Total gross deferred tax liabilities 8,004 3,868 Net deferred tax assets $ — $ — |
Summary of Operating Loss Carryforwards | Net Operating Loss Carryforward as of December 31, 2020 by Expiry Date ($ in ‘000s) Year of Occurrence Year of Expiration Amount 2011 2031 $ 1 2012 2032 70 2015 2035 1 2017 2037 13,649 2018 2038 8,903 2018 Indefinite 8,245 2019 2039 4,973 2019 Indefinite 6,306 2020 2040 31,300 2020 Indefinite 4,686 Total $ 78,134 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and Equipment Held 1 ($ in ‘000s) As of December 31, 2020 2019 Buildings $ 7,425 $ 7,425 Land 1,840 1,840 Building improvements 9,031 9,023 Leasehold improvements 193 193 Internal use software 12,795 12,610 Computer equipment 1,838 1,925 Furniture and other office equipment 1,121 1,150 Total $ 34,243 $ 34,166 Accumulated depreciation (15,428) (12,373) Total property and equipment, net $ 18,815 $ 21,793 1 Excluding assets held for sale. |
Reinsurance Ceded (Tables)
Reinsurance Ceded (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Underwriting Policy and Reinsurance Ceded [Abstract] | |
Schedule of Effects of Reinsurance | Premiums Written, Premiums Earned and Amounts Related to Reinsurance ($ in ‘000s) Year ended December 31, 2020 2019 Direct premiums written $ — $ 133,827 Assumed premiums written — 26,857 Ceded premiums written — (72,911) Net premiums written $ — $ 87,773 Direct premiums earned $ — $ 149,609 Assumed premiums earned — 26,954 Ceded premiums earned — (66,322) Net premiums earned $ — $ 110,241 Ceded claims and claims adjustment expenses $ — $ 31,551 Ceding commissions $ — $ 16,382 |
Claim Liabilities (Tables)
Claim Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Insurance Loss Reserves [Abstract] | |
Schedule of Liability for Unpaid Claims and Claims Adjustment Expense | Changes in the Provision for Unpaid Claims and Claims Adjustment Expenses, Net of Reinsurance Recoverables ($ in ‘000s) Year ended December 31, 2020 2019 Unpaid claims and claims adjustment expenses, beginning of period $ — $ 226,487 Less: reinsurance recoverable — 55,265 Net unpaid claims and claims adjustment expenses, beginning of period — 171,222 Incurred related to: Current year — 78,612 Prior years — 2,155 — 80,767 Paid related to: Current year — 22,176 Prior years — 89,970 — 112,146 Reduction in liability from deconsolidation — 139,843 Net unpaid claims and claims adjustment expenses, end of period — — Add: reinsurance recoverable — — Unpaid claims and claims adjustment expenses, end of period $ — $ — |
Share Based Compensation (Table
Share Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Option Activity | Stock Option Activity (prices in Canadian dollars designated with “C$” and U.S. dollars designated with “US$”) Year ended December 31, 2020 2019 Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price C$ Denominated: Outstanding, beginning of period 27,195 C$6.00 27,195 C$6.00 Granted — — — — Exercised — — — — Canceled (27,195) C$6.00 — — Outstanding, end of period — $— 27,195 C$6.00 US$ Denominated: Outstanding, beginning of period 375,000 US$17.01 375,000 US$17.01 Granted — — — — Exercised — — — — Canceled (193,500) US$18.73 — — Outstanding, end of period 181,500 US$13.51 375,000 US$17.01 |
Schedule of Option Outstanding | Options Outstanding As of December 31, 2020 Grant Date Expiration Date Number Outstanding Number Exercisable March 6, 2014 March 6, 2024 175,000 — March 12, 2015 March 12, 2025 6,500 — Total 181,500 — |
Schedule of Restricted Stock and Restricted Stock Units Activity | Restricted Stock Grants for Ordinary Voting Common Shares and Restricted Share Unit Activity Year ended December 31, 2020 2019 Number of Shares Weighted Average Fair Value at Grant Date Number of Shares Weighted Average Fair Value at Grant Date Non-vested, beginning of period 171,682 $ 17.46 207,156 $ 16.50 Granted — — — — Vested (8,381) 10.22 (28,066) 11.79 Canceled (160,000) 9.62 (7,408) 12.20 Non-vested, end of period 3,301 $ 10.22 171,682 $ 17.46 |
Share Capital and Mezzanine Equ
Share Capital and Mezzanine Equity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share Capital and Mezzanine Equity [Abstract] | |
Schedule of Stock by Class | Share Capital Activity As of December 31, 2020 2019 Shares Authorized Shares Issued Shares Outstanding Amount ($ in ‘000s) Shares Issued Shares Outstanding Amount ($ in ‘000s) Ordinary voting common shares 266,666,667 12,248,798 11,993,293 $ 37 12,198,319 11,942,812 $ 36 Restricted voting common shares 33,333,334 — — — — — — Total common shares 300,000,001 12,248,798 11,993,293 $ 37 12,198,319 11,942,812 $ 36 |
Deferred Policy Acquisition C_2
Deferred Policy Acquisition Costs (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Deferred Policy Acquisition Costs [Abstract] | |
Deferred Policy Acquisition Costs Roll Forward | Components of Deferred Policy Acquisition Costs ($ in ‘000s) Year ended December 31, 2020 2019 Balance, beginning of period $ — $ 5,918 Acquisition costs deferred — 24,563 Amortization charged to income — (11,825) Reduction of acquisition costs from deconsolidation of ASI Pool Companies — (18,656) Balance, end of period $ — $ — |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Lease, Cost | Lease Expense ($ in ‘000s) 2020 2019 Operating leases $ 752 $ 904 Variable lease cost 358 332 Total $ 1,110 $ 1,236 Other Operating Lease Information ($ in ‘000s) 2020 2019 Cash paid for amounts included in the measurement of lease liabilities reported in operating cash flows $ 1,109 $ 1,237 Right-of-use assets obtained in exchange for new lease liabilities — 31 Total $ 1,109 $ 1,268 |
Lessee, Operating Lease, Liability, Maturity | The following table presents the undiscounted contractual maturities of the Company’s operating lease liability at December 31, 2020: Contractual Operating Lease Liabilities ($ in ‘000s) 2021 $ 892 2022 179 2023 23 Total lease payments $ 1,094 Impact of discounting (3) Operating lease liability $ 1,091 Supplemental Balance Sheet Disclosures ($ in ‘000s) Lease Component Balance Sheet Classification As of December 31, 2020 Lease right-of-use asset Right-of-use asset $ 888 Weighted-average remaining lease term 1.2 years Weighted-average discount rate 3.5 % |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Summary of Outstanding Debt | Notes Payable Outstanding ($ in ‘000s) As of December 31, 2020 2019 6.625% Senior Unsecured Notes due April 26, 2022 $ 25,000 $ 25,000 1.0% PPP Loan due May 1, 2022 4,601 — 5.0% Mortgage due November 10, 2026 6,863 7,621 Total outstanding borrowings 36,464 32,621 Unamortized issuance costs (296) (521) Total notes payable $ 36,168 $ 32,100 |
Deconsolidation and Discontin_2
Deconsolidation and Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations | Summary financial information for Global Liberty included in income (loss) from discontinued operations, net of tax in the consolidated statements of operations for the years ended December 31, 2020 and 2019 is presented below: Income (loss) From Discontinued Operations ($ in ‘000s) Year ended December 31, 2020 2019 Net premiums earned $ 13,908 $ 27,862 Net investment (loss) income (102) 437 Net realized losses (1,411) (9) Total revenue 12,395 28,290 Net claims incurred 689 25,833 Acquisition costs 6,875 5,467 Other underwriting expenses 5,117 4,504 Interest (income) (2) (87) Total expenses 12,679 35,717 Loss from operations before income taxes (284) (7,427) Income tax (benefit) (522) — Net income (loss) $ 238 $ (7,427) Statements of Comprehensive Income (Loss) Net income (loss) $ 238 $ (7,427) Other comprehensive income: Changes in net unrealized investment gains 161 634 Reclassification to net income (loss) (155) 547 Other comprehensive income 6 1,181 Total comprehensive income (loss) $ 244 $ (6,246) The assets and liabilities of Global Liberty are presented as held for sale in the consolidated statements of financial position at December 31, 2020 and 2019 is presented below: ($ in ‘000s) December 31, 2020 2019 Assets Investments Fixed income securities, available for sale, at fair value (amortized cost $4,315 and $14,016) $ 4,544 $ 14,239 Short-term investments, at cost — 491 Other investments 1,319 1,315 Total investments 5,863 16,045 Cash and cash equivalents 3,029 7,712 Accrued investment income 29 78 Reinsurance recoverables on amounts paid 581 2,227 Reinsurance recoverables on amounts unpaid 31,958 18,339 Prepaid reinsurance premiums 9,739 3,765 Deferred policy acquisition costs 637 534 Property and equipment, net — 1,741 Other assets 2,049 861 Total assets $ 53,885 $ 51,302 Liabilities Claims liabilities $ 38,499 $ 46,771 Unearned premium reserves 14,545 12,423 Due to reinsurers 10 1,019 Other liabilities and accrued expenses 7,353 2,554 Total liabilities $ 60,407 $ 62,767 |
Nature of Operations and Basi_3
Nature of Operations and Basis of Presentation Intangible Assets (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Trade name and trademark | ||
Finite-Lived Intangible Assets [Line Items] | ||
Economic Useful Life | 15 years | 15 years |
Customer relationship | ||
Finite-Lived Intangible Assets [Line Items] | ||
Economic Useful Life | 10 years | 10 years |
Nature of Operations and Basi_4
Nature of Operations and Basis of Presentation Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Building and Building Improvements | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 33 years |
Building improvements | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 10 years |
Vehicles | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5 years |
Furniture | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5 years |
Enterprise Software | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5 years |
Software and Development Costs | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 3 years |
Nature of Operations and Basi_5
Nature of Operations and Basis of Presentation Narrative (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020USD ($)numberOfState | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Accounting Policies [Abstract] | |||
Number of states in which entity operates | numberOfState | 49 | ||
Number of states, core products actively distributed | numberOfState | 41 | ||
Commission income | $ | $ 5,195 | $ 7,458 | |
Commissions receivable | $ | $ 2,577 | $ 1,428 | $ 0 |
Nature of Operations and Basi_6
Nature of Operations and Basis of Presentation Operating Segments (Details) | 12 Months Ended |
Dec. 31, 2020numberOfSegment | |
Accounting Policies [Abstract] | |
Number of operating segments (segment) | 1 |
New Accounting Standards (Detai
New Accounting Standards (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right-of-use asset | $ 888 | $ 1,592 | |
Operating lease liability | $ 1,091 | $ 1,993 | |
Accounting Standards Update 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right-of-use asset | $ 2,500 | ||
Operating lease liability | $ 3,100 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Business Combinations [Abstract] | ||
Amortization of intangible assets | $ 390 | $ 390 |
Estimated future amortization expense, 2021 | 390 | |
Estimated future amortization expense, 2022 | 390 | |
Estimated future amortization expense, 2023 | 390 | |
Estimated future amortization expense, 2024 | 390 | |
Estimated future amortization expense, 2025 | $ 390 |
Intangible Assets - Intangible
Intangible Assets - Intangible Assets by Major Asset Class (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Accumulated Amortization | $ 2,265 | $ 1,875 |
Gross Carrying Amount | 740 | |
Gross Carrying Amount | 4,500 | 4,500 |
Net | $ 2,235 | $ 2,625 |
Trade name and trademark | ||
Finite-Lived Intangible Assets [Line Items] | ||
Economic Useful Life | 15 years | 15 years |
Gross Carrying Amount | $ 1,800 | $ 1,800 |
Accumulated Amortization | 703 | 581 |
Net | $ 1,097 | $ 1,219 |
Customer relationship | ||
Finite-Lived Intangible Assets [Line Items] | ||
Economic Useful Life | 10 years | 10 years |
Gross Carrying Amount | $ 2,700 | $ 2,700 |
Accumulated Amortization | 1,562 | 1,294 |
Net | $ 1,138 | $ 1,406 |
Loss From Continuing Operatio_3
Loss From Continuing Operations per Share Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Basic: | ||
Loss from continuing operations before income taxes | $ (13,452) | $ (12,776) |
Income tax (benefit) expense | (484) | 223 |
Net loss attributable to common shareholders from continuing operations | $ (12,968) | $ (12,999) |
Basic weighted average common shares outstanding (in shares) | 11,957,268 | 11,954,494 |
Loss per common share basic from continuing operations (in dollars per share) | $ (1.08) | $ (1.09) |
Diluted: | ||
Dilutive stock options outstanding (in shares) | 0 | 0 |
Dilutive weighted average common shares outstanding (in shares) | 11,957,268 | 11,954,494 |
Loss per common share diluted from continuing operations (in dollars per share) | $ (1.08) | $ (1.09) |
Loss From Continuing Operatio_4
Loss From Continuing Operations per Share (Details) - $ / shares | Dec. 31, 2020 | Jun. 10, 2019 |
Potential Dilutive Securities from Earnings Per Share [Line Items] | ||
Exercise price of warrants or rights (in dollars per share) | $ 0.69 | $ 0.69 |
Ordinary Voting Common Shares, Warrants to Purchase | ||
Potential Dilutive Securities from Earnings Per Share [Line Items] | ||
Class of warrant or right, outstanding | 2,387,368 | 2,387,368 |
Contracts with Customers (Detai
Contracts with Customers (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | ||
Commission income | $ 5,195 | $ 7,458 |
Contracts with Customers - Comm
Contracts with Customers - Commissions Revenue Roll Forward (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Commissions Receivable [Roll Forward] | ||
Commission receivable, beginning of year | $ 1,428 | $ 0 |
Commission income | 5,195 | 7,458 |
Net change in cash received | (4,046) | (6,030) |
Commission receivable, end of year | $ 2,577 | $ 1,428 |
Investments Schedule of Investm
Investments Schedule of Investment Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Investments [Abstract] | ||
Interest income | $ 0 | $ 1,877 |
Income from other investments | 0 | 793 |
Investment expenses | 0 | (768) |
Net investment income | $ 0 | $ 1,902 |
Investments Schedule of Gross R
Investments Schedule of Gross Realized Gains (Losses) on Sales (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Debt Securities, Available-for-sale [Line Items] | ||
Proceeds from sales and calls | $ 0 | $ 52,400 |
Gross realized investment gains | 0 | 1,143 |
Gross realized investment losses | 0 | (322) |
Fixed Income Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Proceeds from sales and calls | 0 | 42,406 |
Gross realized investment gains | 0 | 450 |
Gross realized investment losses | 0 | (205) |
Equities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Proceeds from sales and calls | 0 | 5,997 |
Gross realized investment gains | 0 | 443 |
Gross realized investment losses | 0 | (96) |
Other Investments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Proceeds from sales and calls | 0 | 3,997 |
Gross realized investment gains | 0 | 250 |
Gross realized investment losses | $ 0 | $ (21) |
Investments Schedule of Inves_2
Investments Schedule of Investment Gains (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Gain (Loss) on Securities [Line Items] | ||
Net realized gains (losses) | $ 0 | $ 821 |
Other | ||
Gain (Loss) on Securities [Line Items] | ||
Net realized gains (losses) | 0 | 229 |
Fixed Income Securities | ||
Gain (Loss) on Securities [Line Items] | ||
Net realized gains (losses) | 0 | 245 |
Equities | ||
Gain (Loss) on Securities [Line Items] | ||
Net realized gains (losses) | $ 0 | $ 347 |
Income Taxes -Narrative (Detail
Income Taxes -Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Income Tax Disclosure [Abstract] | ||
Deferred Tax Assets, Valuation Allowance | $ 33,420 | $ 32,522 |
Income Taxes - Income Tax Rate
Income Taxes - Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||
Provision for taxes at U.S. statutory marginal income tax rate | $ (2,825) | $ (2,683) |
Provision for deferred tax assets deemed unrealizable (valuation allowance) | 1,744 | 2,779 |
Nondeductible expenses | (3) | 28 |
Tax-exempt income | 0 | (3) |
State tax (net of federal benefit) | (3) | 71 |
Stock compensation | 630 | 31 |
Tax rate differential | (42) | 0 |
Other | 15 | 0 |
Provision for income taxes for continuing operations | $ (484) | $ 223 |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Provision for taxes at U.S. statutory marginal income tax rate, percent | 21.00% | 21.00% |
Provision for deferred tax assets deemed unrealizable (valuation allowance), percent | (13.00%) | (21.80%) |
Nondeductible expenses, percent | 0.00% | (0.20%) |
Tax-exempt income, percent | 0.00% | 0.00% |
State tax (net of federal benefit), percent | 0.00% | (0.60%) |
Stock compensation, percent | (4.70%) | (0.20%) |
Tax rate differential, percent | 0.30% | 0.00% |
Other, percent | (0.10%) | 0.00% |
Effective Income Tax Rate | 3.50% | (1.80%) |
Discontinued Operations | ||
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||
Provision for taxes at U.S. statutory marginal income tax rate | $ (60) | $ (1,560) |
Provision for deferred tax assets deemed unrealizable (valuation allowance) | (264) | 1,559 |
Nondeductible expenses | 2 | 3 |
Tax-exempt income | 0 | (2) |
Tax rate differential | (200) | 0 |
Provision for income taxes for continuing operations | $ (522) | $ 0 |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Provision for taxes at U.S. statutory marginal income tax rate, percent | 21.00% | 21.00% |
Provision for deferred tax assets deemed unrealizable (valuation allowance), percent | 92.90% | (21.00%) |
Nondeductible expenses, percent | (0.70%) | 0.00% |
Tax-exempt income, percent | 0.00% | 0.00% |
Tax rate differential, percent | 70.40% | 0.00% |
Effective Income Tax Rate | 183.60% | 0.00% |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Contingency [Line Items] | ||
Current tax (benefit) expense | $ (484) | $ 223 |
Discontinued Operations | ||
Income Tax Contingency [Line Items] | ||
Current tax (benefit) expense | $ (522) | $ 0 |
Income Taxes Deferred Tax Asset
Income Taxes Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Gross deferred tax assets: | ||
Losses carried forward | $ 16,408 | $ 10,264 |
Claims liabilities and unearned premium reserves | 496 | 554 |
Investment in affiliates | 23,870 | 24,450 |
Bad debts | 168 | 168 |
Stock compensation | 279 | 873 |
Other | 203 | 81 |
Valuation allowance | (33,420) | (32,522) |
Total gross deferred tax assets | 8,004 | 3,868 |
Gross deferred tax liabilities: | ||
Deferred policy acquisition costs | 134 | 112 |
Investments | 122 | 116 |
Fixed assets | 1,344 | 2,099 |
Intangible assets | 469 | 551 |
Other | 5,935 | 990 |
Total gross deferred tax liabilities | 8,004 | 3,868 |
Net deferred tax assets | $ 0 | $ 0 |
Income Taxes Schedule of Tax Ca
Income Taxes Schedule of Tax Carryforwards (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | $ 78,134 |
Carryforward Expiring in 2031 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | 1 |
Carryforward Expiring in 2032 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | 70 |
Carryforward Expiring in 2035 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | 1 |
Carryforward Expiring in 2037 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | 13,649 |
Carryforward Expiring in 2038 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | 8,903 |
Carryforward Expiring Indefinite Originated In 2018 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | 8,245 |
Carryforward Expiring in 2039 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | 4,973 |
Carryforward Expiring Indefinite Originated In 2019 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | 6,306 |
Carryforward Expiring in 2040 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | 31,300 |
Carryforward Expiring Indefinite Originated In 2020 | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Subject to Expiration | $ 4,686 |
Property and Equipment (Details
Property and Equipment (Details) ft² in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2016USD ($) | Oct. 01, 2017ft² | |
Property, Plant and Equipment [Line Items] | ||||
Property and equipment gross | $ 34,243 | $ 34,166 | ||
Accumulated depreciation | (15,428) | (12,373) | ||
Total property and equipment, net | 18,815 | 21,793 | ||
Depreciation and amortization | 3,172 | 3,850 | ||
Occupied Area of Corporate Headquarters Building | ft² | 70,000 | |||
Rental income | 462 | 408 | ||
Capitalized costs | 185 | 2,400 | ||
Amortization of capitalized costs | 1,400 | 1,900 | ||
Net realized (losses) gains | (3) | 821 | ||
Building and land | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and land addition | $ 9,300 | |||
Buildings | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment gross | 7,425 | 7,425 | ||
Land | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment gross | 1,840 | 1,840 | ||
Building improvements | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment gross | 9,031 | 9,023 | ||
Leasehold improvements | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment gross | 193 | 193 | ||
Internal use software | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment gross | 12,795 | 12,610 | ||
Computer equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment gross | 1,838 | 1,925 | ||
Furniture and other office equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment gross | 1,121 | 1,150 | ||
Building and Building Improvements | ||||
Property, Plant and Equipment [Line Items] | ||||
Depreciation and amortization | 1,100 | 1,100 | ||
Equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Net realized (losses) gains | (3) | (21) | ||
Global Liberty Insurance Company | ||||
Property, Plant and Equipment [Line Items] | ||||
Depreciation and amortization | 0 | 250 | ||
Continuing Operations | ||||
Property, Plant and Equipment [Line Items] | ||||
Depreciation and amortization | $ 3,200 | $ 3,900 |
Reinsurance Ceded (Details)
Reinsurance Ceded (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Underwriting Policy and Reinsurance Ceded [Abstract] | ||
Direct premiums written | $ 0 | $ 133,827 |
Assumed premiums written | 0 | 26,857 |
Ceded premiums written | 0 | (72,911) |
Net premiums written | 0 | 87,773 |
Direct premiums earned | 0 | 149,609 |
Assumed premiums earned | 0 | 26,954 |
Ceded premiums earned | 0 | (66,322) |
Net premiums earned | 0 | 110,241 |
Ceded claims and claims adjustment expenses | 0 | 31,551 |
Ceding commissions | $ 0 | $ 16,382 |
Unpaid Claims (Details)
Unpaid Claims (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||
Unpaid claims and claims adjustment expenses, beginning of period | $ 0 | $ 226,487 |
Less: reinsurance recoverable | 0 | 55,265 |
Net unpaid claims and claims adjustment expenses, beginning of period | 0 | 171,222 |
Incurred related to: | ||
Current year | 0 | 78,612 |
Prior years | 0 | 2,155 |
Total incurred current and prior years | 0 | 80,767 |
Paid related to: | ||
Current year | 0 | 22,176 |
Prior years | 0 | 89,970 |
Total paid related to current and prior years | 0 | 112,146 |
Reduction in liability from deconsolidation | 0 | 139,843 |
Net unpaid claims and claims adjustment expenses, end of period | 0 | 0 |
Add: reinsurance recoverable | 0 | 0 |
Unpaid claims and claims adjustment expenses, end of period | $ 0 | $ 0 |
Share-Based Compensation Schedu
Share-Based Compensation Schedule of Activity Related Share-Based Compensation (Details) | 12 Months Ended | |||
Dec. 31, 2020$ / sharesshares | Dec. 31, 2020$ / sharesshares | Dec. 31, 2019$ / sharesshares | Dec. 31, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Options, outstanding (in shares), end of period | 181,500 | 181,500 | ||
CANADA | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Options, outstanding (in shares), beginning of period | 27,195 | 27,195 | 27,195 | 27,195 |
Options, granted in period (in shares) | 0 | 0 | 0 | 0 |
Options, exercised in period (in shares) | 0 | 0 | 0 | 0 |
Options, canceled in period (in shares) | (27,195) | (27,195) | 0 | 0 |
Options, outstanding (in shares), end of period | 0 | 0 | 27,195 | 27,195 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||||
Options, outstanding, weighted average exercise price, beginning balance (in Canadian or US dollars per share) | $ / shares | $ 6 | $ 6 | ||
Options, grants in period, weighted average exercise price (in Canadian or US dollars per share) | $ / shares | 0 | 0 | ||
Options, exercised in period, weighted average exercise price (in Canadian or US dollars per share) | $ / shares | 0 | 0 | ||
Options, canceled in period, weighted average exercise price (in Canadian or US dollars per share) | $ / shares | 6 | 0 | ||
Options, outstanding, weighted average exercise price, end of period (in Canadian or US dollars per share) | $ / shares | $ 0 | $ 6 | ||
UNITED STATES | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Options, outstanding (in shares), beginning of period | 375,000 | 375,000 | 375,000 | 375,000 |
Options, granted in period (in shares) | 0 | 0 | 0 | 0 |
Options, exercised in period (in shares) | 0 | 0 | 0 | 0 |
Options, canceled in period (in shares) | (193,500) | (193,500) | 0 | 0 |
Options, outstanding (in shares), end of period | 181,500 | 181,500 | 375,000 | 375,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||||
Options, outstanding, weighted average exercise price, beginning balance (in Canadian or US dollars per share) | $ / shares | $ 17.01 | $ 17.01 | ||
Options, grants in period, weighted average exercise price (in Canadian or US dollars per share) | $ / shares | 0 | 0 | ||
Options, exercised in period, weighted average exercise price (in Canadian or US dollars per share) | $ / shares | 0 | 0 | ||
Options, canceled in period, weighted average exercise price (in Canadian or US dollars per share) | $ / shares | 18.73 | 0 | ||
Options, outstanding, weighted average exercise price, end of period (in Canadian or US dollars per share) | $ / shares | $ 13.51 | $ 17.01 |
Share-Based Compensation Sche_2
Share-Based Compensation Schedule of Outstanding Options (Details) | Dec. 31, 2020shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options, outstanding (in shares) | 181,500 |
Options, exercisable (in shares) | 0 |
March 6, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options, outstanding (in shares) | 175,000 |
Options, exercisable (in shares) | 0 |
March 12, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options, outstanding (in shares) | 6,500 |
Options, exercisable (in shares) | 0 |
Share-Based Compensation Stock
Share-Based Compensation Stock Options - Additional Information (Details) | Mar. 12, 2015installmentshares | Mar. 31, 2020shares | Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($)shares | Dec. 31, 2018USD ($)shares | Apr. 04, 2018$ / shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options, exercisable (in shares) | 0 | |||||
Grants, weighted average remaining life | 3 years 2 months 19 days | |||||
Options, outstanding, intrinsic value | $ | $ 0 | |||||
Share-based compensation expense | $ | $ 872,000 | |||||
Restricted shares canceled during period (shares) | 140,000 | |||||
March 12, 2015 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options, exercisable (in shares) | 0 | |||||
Restricted Stock Grants | March 12, 2015 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted share awards, nonvested, fair value | $ | $ 1,900,000 | |||||
Restricted Stock Units (RSUs) | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares vested during period (in shares) | 2,540 | 7,408 | ||||
Stock Options | March 12, 2015 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options, nonvested, fair value | $ | $ 1,500,000 | |||||
Restricted stock and restricted stock units (RSUs) Grants | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares granted during period (in shares) | 0 | 0 | ||||
Restricted shares vested during period (in shares) | 8,381 | 28,066 | ||||
Restricted shares canceled during period (shares) | 160,000 | 7,408 | ||||
Share-based compensation expense | $ | $ 292,000 | |||||
Unearned share-based compensation expense | $ | $ 0 | |||||
Restricted share and restricted share units grants | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares canceled during period (shares) | 140,000 | 140,000 | ||||
Director | December 31, 2018 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting rights, percentage | 33.30% | |||||
Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares canceled during period (shares) | 53,500 | |||||
Officer | March 12, 2015 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting rights, percentage | 20.00% | |||||
Award vesting period | installment | 5 | |||||
Officer | Restricted Stock Grants | March 12, 2015 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares granted during period (in shares) | 200,000 | |||||
Restricted shares vested during period (in shares) | 0 | 0 | ||||
Officer | Stock Options | March 12, 2015 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options, granted in period (in shares) | 200,000 | |||||
Officer | Restricted share and restricted share units grants | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares canceled during period (shares) | 20,000 | 20,000 | ||||
Equity Incentive Plan | December 31, 2018 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share price (in dollars per share) | $ / shares | $ 10.50 | |||||
Equity Incentive Plan | Director | Restricted Stock Units (RSUs) | December 31, 2018 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Fair value of shares issued | $ | $ 40,000 | |||||
Restricted shares granted during period (in shares) | 17,524 | |||||
Aggregate grant date fair value | $ | $ 179,000 |
Share-Based Compensation Sche_3
Share-Based Compensation Schedule of Restricted Shares and Restricted Share Units (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 872 | |
Restricted stock and restricted stock units (RSUs) Grants | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 292 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Restricted shares nonvested at period start (in shares) | 171,682 | 207,156 |
Restricted shares granted during period (in shares) | 0 | 0 |
Restricted shares vested during period (in shares) | (8,381) | (28,066) |
Restricted shares canceled during period (in shares) | (160,000) | (7,408) |
Restricted shares nonvested at period end (in shares) | 3,301 | 171,682 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Weighted average fair value at grant date, restricted shares nonvested at period start (USD per share) | $ 17.46 | $ 16.50 |
Weighted average fair value at grant date, restricted shares granted during period (USD per share) | 0 | 0 |
Weighted average fair value at grant date, restricted shares vested during period (USD per share) | 10.22 | 11.79 |
Weighted average fair value at grant date, restricted shares canceled during period (USD per share) | 9.62 | 12.20 |
Weighted average fair value at grant date, restricted shares nonvested at period end (USD per share) | $ 10.22 | $ 17.46 |
Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Restricted shares nonvested at period start (in shares) | 11,682 | |
Restricted shares vested during period (in shares) | (2,540) | (7,408) |
Restricted shares nonvested at period end (in shares) | 3,301 | 11,682 |
Other Employee Benefit Plans De
Other Employee Benefit Plans Defined Contribution Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Other Employee Benefit Plans [Abstract] | ||
Defined contribution plan, percent of employee contribution matched by employer, up to 2.5% annual earnings | 100.00% | |
Defined contribution plan, percent of employees annual earnings employer will match 100% | 2.50% | |
Defined contribution plan, percent of employer match on additional employee contributions, up to 2.5% annual earnings | 50.00% | |
Defined contribution plan, percent of additional employees annual earnings employer will match 50% | 2.50% | |
Defined contribution plan, employer matching contribution, maximum percent of employees' gross pay | 3.75% | |
Defined contribution plan, employee contribution vesting percentage | 100.00% | |
Defined contribution plan, employers matching contribution, vesting period | 5 years | |
Defined contribution plan, company contributions | $ 77 | $ 386 |
Other Employee Benefit Plans Em
Other Employee Benefit Plans Employee Stock Purchase Plan (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Other Employee Benefit Plans [Abstract] | ||
Employee stock purchase plan, hours per week threshold to be eligible | 30 hours | |
Employee stock purchase plan, maximum annual contribution percent of annual earnings per employee | 0.075 | |
Employee stock purchase plan, percent of employee contribution matched by employer, up to 2.5% annual earnings | 1 | |
Employee stock purchase plan, percent of employees annual earnings employer will match 100% | 2.50% | |
Employee stock purchase plan, percent of employer match on additional employee contributions, up to 5% annual earnings | 50.00% | |
Employee stock purchase plan, percent of additional employees annual earnings employer will match 50% | 5.00% | |
Employee stock purchase plan, employer matching contribution, maximum percent of employee's gross pay | 5.00% | |
Employee stock purchase plan, company cost | $ 21 | $ 108 |
Share Capital, Warrants and M_2
Share Capital, Warrants and Mezzanine Equity Schedule of Stock by Class (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Class of Stock [Line Items] | ||
Common shares, shares authorized (in shares) | 300,000,001 | |
Common Stock, Shares, Issued | 12,248,798 | 12,198,319 |
Common stock, shares, outstanding (in shares) | 11,993,293 | 11,942,812 |
Common stock, value, outstanding | $ 37 | $ 36 |
Ordinary Voting Common Shares | ||
Class of Stock [Line Items] | ||
Common shares, shares authorized (in shares) | 266,666,667 | 266,666,667 |
Common Stock, Shares, Issued | 12,248,798 | 12,198,319 |
Common stock, shares, outstanding (in shares) | 11,993,293 | 11,942,812 |
Common stock, value, outstanding | $ 37 | $ 36 |
Restricted Voting Common Shares | ||
Class of Stock [Line Items] | ||
Common shares, shares authorized (in shares) | 33,333,334 | 33,333,334 |
Common Stock, Shares, Issued | 0 | 0 |
Common stock, shares, outstanding (in shares) | 0 | 0 |
Common stock, value, outstanding | $ 0 | $ 0 |
Share Capital, Warrants and M_3
Share Capital, Warrants and Mezzanine Equity Stock Activity and Mezzanine Equity (Details) - $ / shares | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Jun. 10, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Ordinary voting common shares issued, restricted stock and RSU vesting (in shares) | 210,481 | |||
Exercise price of warrants or rights (in dollars per share) | $ 0.69 | $ 0.69 | ||
Incentive Program | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Ordinary voting common shares issued, restricted stock and RSU vesting (in shares) | 202,100 | |||
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Nonvested restricted stock units (RSUs) (in shares) | 3,301 | 11,682 | ||
Ordinary voting common shares issued, restricted stock and RSU vesting (in shares) | 8,381 | 5,842 | ||
Restricted share and restricted share units grants | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted shares canceled during period (shares) | 140,000 | 140,000 | ||
Restricted share and restricted share units grants | Officer | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted shares canceled during period (shares) | 20,000 | 20,000 | ||
Ordinary Voting Common Shares, Sole Power to Vote | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Class of warrant or right, outstanding | 2,387,368 | |||
Ordinary Voting Common Shares, Sole Power to Dispose of | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Class of warrant or right, outstanding | 2,387,368 | |||
Ordinary Voting Common Shares, Warrants to Purchase | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Class of warrant or right, outstanding | 2,387,368 | 2,387,368 |
Deferred Policy Acquisition C_3
Deferred Policy Acquisition Costs Deferred Policy Acquisition Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Movement Analysis of Deferred Policy Acquisition Costs [Roll Forward] | ||
Balance, beginning of period | $ 0 | $ 5,918 |
Acquisition costs deferred | 0 | 24,563 |
Amortization charged to income | 0 | (11,825) |
Reduction of acquisition costs from deconsolidation of ASI Pool Companies | 0 | (18,656) |
Balance, end of period | $ 0 | $ 0 |
Leases - Lease Expenses (Detail
Leases - Lease Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating leases | $ 752 | $ 904 |
Variable lease cost | 358 | 332 |
Lease expense | $ 1,110 | $ 1,236 |
Leases - Other Operating Lease
Leases - Other Operating Lease Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities reported in operating cash flows | $ 1,109 | $ 1,237 |
Right-of-use assets obtained in exchange for new lease liabilities | 0 | 31 |
Lease expense | $ 1,109 | $ 1,268 |
Leases - Contractual Operating
Leases - Contractual Operating Lease Liability (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
2021 | $ 892 | |
2022 | 179 | |
2023 | 23 | |
Total lease payments | 1,094 | |
Impact of discounting | (3) | |
Operating lease liability | 1,091 | $ 1,993 |
Right-of-use asset | $ 888 | $ 1,592 |
Weighted-average remaining lease term | 1 year 2 months 12 days | |
Weighted-average discount rate | 3.50% |
Notes Payable (Details)
Notes Payable (Details) | May 01, 2020USD ($)payment | Apr. 26, 2017USD ($) | Nov. 10, 2016USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
PPP Loan | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, face amount | $ 4,600,500 | ||||
Debt instrument, interest rate, stated percentage | 1.00% | ||||
Number of equal monthly payments | payment | 18 | ||||
Debt instrument, periodic payment | $ 257,611.48 | ||||
Loan Agreement | American Insurance Acquisition | |||||
Line of Credit Facility [Line Items] | |||||
Interest expense, including non-utilization fees | $ 2,300,000 | $ 2,000,000 | |||
Loan Agreement | 5.0% Mortgage due November 10, 2026 | American Insurance Acquisition | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, face amount | $ 10,700,000 | ||||
Debt instrument, term | 10 years | ||||
Debt instrument, interest rate, stated percentage | 5.00% | 5.00% | |||
Senior unsecured notes | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, face amount | $ 25,000,000 | ||||
Debt instrument, term | 5 years | ||||
Debt instrument, interest rate, stated percentage | 6.625% | 6.625% | |||
Amount of funds accessed in period | $ 23,900,000 | ||||
Redemption price, percentage | 100.00% |
Notes Payable Schedule of Debt
Notes Payable Schedule of Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Apr. 26, 2017 | Nov. 10, 2016 |
Line of Credit Facility [Line Items] | ||||
Notes payable, outstanding gross of unamortized issuance costs | $ 36,464 | $ 32,621 | ||
Unamortized issuance costs | (296) | (521) | ||
Notes payable, net | $ 36,168 | 32,100 | ||
Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, interest rate, stated percentage | 0.01% | |||
Notes payable, outstanding gross of unamortized issuance costs | $ 4,601 | 0 | ||
Senior unsecured notes | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, interest rate, stated percentage | 6.625% | 6.625% | ||
Notes payable, outstanding gross of unamortized issuance costs | $ 25,000 | 25,000 | ||
American Insurance Acquisition | Loan Agreement | 5.0% Mortgage due November 10, 2026 | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, interest rate, stated percentage | 5.00% | 5.00% | ||
Notes payable, outstanding gross of unamortized issuance costs | $ 6,863 | $ 7,621 |
Deconsolidation and Discontin_3
Deconsolidation and Discontinued Operations Loss From Discontinued Operations, Net of Tax (Details) - Global Liberty - Discontinued operations, held-for-sale - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | ||
Net premiums earned | $ 13,908 | $ 27,862 |
Net investment (loss) income | (102) | 437 |
Net realized losses | (1,411) | (9) |
Total revenue | 12,395 | 28,290 |
Net claims incurred | 689 | 25,833 |
Acquisition costs | 6,875 | 5,467 |
Other underwriting expenses | 5,117 | 4,504 |
Interest (income) | (2) | (87) |
Total expenses | 12,679 | 35,717 |
Loss from operations before income taxes | (284) | (7,427) |
Income tax (benefit) | (522) | 0 |
Net income (loss) | 238 | (7,427) |
Changes in net unrealized investment gains | 161 | 634 |
Reclassification to net income (loss) | (155) | 547 |
Other comprehensive income | 6 | 1,181 |
Total comprehensive income (loss) | $ 244 | $ (6,246) |
Deconsolidation and Discontin_4
Deconsolidation and Discontinued Operations Consolidated Statements of Financial Position (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Liabilities | ||
Total liabilities | $ 60,407 | $ 62,767 |
Global Liberty | Discontinued operations, held-for-sale | ||
Assets | ||
Fixed income securities, available for sale, at fair value (amortized cost $4,315 and $14,016) | 4,544 | 14,239 |
Short-term investments, at cost | 0 | 491 |
Other investments | 1,319 | 1,315 |
Total investments | 5,863 | 16,045 |
Cash and cash equivalents | 3,029 | 7,712 |
Accrued investment income | 29 | 78 |
Reinsurance recoverables on amounts paid | 581 | 2,227 |
Reinsurance recoverables on amounts unpaid | 31,958 | 18,339 |
Prepaid reinsurance premiums | 9,739 | 3,765 |
Deferred policy acquisition costs | 637 | 534 |
Property and equipment, net | 0 | 1,741 |
Other assets | 2,049 | 861 |
Total assets | 53,885 | 51,302 |
Liabilities | ||
Claims liabilities | 38,499 | 46,771 |
Unearned premium reserves | 14,545 | 12,423 |
Due to reinsurers | 10 | 1,019 |
Other liabilities and accrued expenses | 7,353 | 2,554 |
Total liabilities | $ 60,407 | $ 62,767 |
Deconsolidation and Discontin_5
Deconsolidation and Discontinued Operations Consolidated Statements of Financial Position (Additional Information) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Discontinued Operations and Disposal Groups [Abstract] | ||
Fixed income securities at fair value, amortized cost | $ 4,315 | $ 14,016 |
Deconsolidation and Discontin_6
Deconsolidation and Discontinued Operations Narrative (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Discontinued Operations and Disposal Groups [Abstract] | ||
Loss on disposal of subsidiaries | $ 0 | $ (4,427) |
Notes receivable | $ 18,017 | $ 17,709 |
Interest Rate, increase on unpaid principal balance | 0.02 | |
Maximum variable interest rate | 0.10 |
Going Concern (Details)
Going Concern (Details) | Apr. 26, 2017USD ($) |
Senior unsecured notes | |
Debt Instrument [Line Items] | |
Debt instrument, face amount | $ 25,000,000 |
Subsequent Events Narrative (De
Subsequent Events Narrative (Details) - Second Paycheck Protection Plan - Subsequent Event | Feb. 07, 2021USD ($) |
Subsequent Event [Line Items] | |
Debt instrument, face amount | $ 2,000,000 |
Debt instrument, interest rate, stated percentage | 1.00% |
Schedule II - Condensed Finan_2
Schedule II - Condensed Financial Information of Registrant Condensed Statement of Comprehensive Income, Parent Company (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Condensed Financial Statements, Captions [Line Items] | ||
Other underwriting expense | $ (17,743) | $ (33,759) |
Interest expense, net | (1,931) | (1,466) |
Loss from operations before income taxes | (13,452) | (12,776) |
Income tax expense (benefit) | (484) | 223 |
Net loss | (12,730) | (20,426) |
Changes in net unrealized investment gains (losses) | 161 | 1,917 |
Reclassification to net income (loss) | (155) | 2,243 |
Other comprehensive income (loss) | 6 | 4,160 |
Total comprehensive loss | (12,724) | (16,266) |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 6 | 4,160 |
Parent Company | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net investment income (expense) | 0 | (6) |
Other underwriting expense | (4,469) | (6,254) |
Interest expense, net | (1,856) | (1,897) |
Loss from operations before income taxes | (6,325) | (8,157) |
Income tax expense (benefit) | 905 | (392) |
Loss before equity in net loss of subsidiaries | (7,230) | (7,765) |
Equity in net loss of subsidiaries | (5,500) | (12,661) |
Net loss | (12,730) | (20,426) |
Changes in net unrealized investment gains (losses) | 161 | 1,917 |
Reclassification to net income (loss) | (155) | 2,243 |
Total comprehensive loss | (12,724) | (16,266) |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | $ 6 | $ 4,160 |
Schedule II - Condensed Finan_3
Schedule II - Condensed Financial Information of Registrant Condensed Balance Sheet, Parent Company (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | |||
Cash and cash equivalents | $ 5,238 | $ 9,025 | |
Total assets | 119,702 | 150,861 | |
Liabilities | |||
Notes payable, net | 36,168 | 32,100 | |
Other liabilities and accrued expenses | 4,342 | 7,302 | |
Total liabilities | 140,594 | 159,322 | |
Shareholders’ deficit | |||
Additional paid-in capital | 81,840 | 81,548 | |
Treasury stock, at cost: 255,505 shares of ordinary common voting shares at December 31, 2020 and December 31, 2019, respectively | (3,000) | (3,000) | |
Retained deficit | (100,199) | (87,469) | |
Accumulated other comprehensive income, net of tax | 430 | 424 | |
Stockholders' Equity Attributable to Parent | (20,892) | (8,461) | $ 5,699 |
Total liabilities and shareholders' deficit | 119,702 | 150,861 | |
Parent Company | |||
Assets | |||
Cash and cash equivalents | 1,106 | 1,966 | |
Investment in subsidiaries | 24,889 | 28,782 | |
Total assets | 26,688 | 30,748 | |
Liabilities | |||
Notes payable, net | 24,704 | 24,479 | |
Other liabilities and accrued expenses | 22,876 | 14,730 | |
Total liabilities | 47,580 | 39,209 | |
Shareholders’ deficit | |||
Ordinary voting common shares, $0.003 par value, 266,666,667 shares authorized, shares issued: December 31, 2020 - 12,248,798 and December 31, 2019 - 12,198,319; shares outstanding: December 31, 2020 - 11,993,293 and December 31, 2019 - 11,942,812 | 37 | 36 | |
Restricted voting common shares, $0.003 par value, 33,333,334 shares authorized, shares issued and outstanding: December 31, 2020 and December 31, 2019 - 0 | 0 | 0 | |
Additional paid-in capital | 81,840 | 81,548 | |
Treasury stock, at cost: 255,505 shares of ordinary common voting shares at December 31, 2020 and December 31, 2019, respectively | (3,000) | (3,000) | |
Retained deficit | (100,199) | (87,469) | |
Accumulated other comprehensive income, net of tax | 430 | 424 | |
Stockholders' Equity Attributable to Parent | (20,892) | (8,461) | |
Total liabilities and shareholders' deficit | $ 26,688 | $ 30,748 |
Schedule II - Condensed Finan_4
Schedule II - Condensed Financial Information of Registrant Condensed Balance Sheet, Parent Company - Additional (Details) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Common shares, shares authorized (in shares) | 300,000,001 | |
Common shares, shares issued (in shares) | 12,248,798 | 12,198,319 |
Common stock, shares, outstanding (in shares) | 11,993,293 | 11,942,812 |
Ordinary Voting Common Shares | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Common shares, par value (USD per share) | $ 0.003 | $ 0.003 |
Common shares, shares authorized (in shares) | 266,666,667 | 266,666,667 |
Common shares, shares issued (in shares) | 12,248,798 | 12,198,319 |
Common stock, shares, outstanding (in shares) | 11,993,293 | 11,942,812 |
Treasury stock, common (in shares) | 255,505 | 255,505 |
Ordinary Voting Common Shares | Parent Company | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Common shares, par value (USD per share) | $ 0.003 | $ 0.003 |
Common shares, shares authorized (in shares) | 266,666,667 | 266,666,667 |
Common shares, shares issued (in shares) | 12,248,798 | 12,198,319 |
Common stock, shares, outstanding (in shares) | 11,993,293 | 11,942,812 |
Treasury stock, common (in shares) | 255,505 | 255,505 |
Restricted Voting Common Shares | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Common shares, par value (USD per share) | $ 0.003 | $ 0.003 |
Common shares, shares authorized (in shares) | 33,333,334 | 33,333,334 |
Common shares, shares issued (in shares) | 0 | 0 |
Common stock, shares, outstanding (in shares) | 0 | 0 |
Restricted Voting Common Shares | Parent Company | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Common shares, par value (USD per share) | $ 0.003 | $ 0.003 |
Common shares, shares authorized (in shares) | 33,333,334 | 33,333,334 |
Common shares, shares issued (in shares) | 0 | 0 |
Common stock, shares, outstanding (in shares) | 0 | 0 |
Schedule II - Condensed Finan_5
Schedule II - Condensed Financial Information of Registrant Condensed Statement of Cash Flows, Parent Company (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Activities | ||
Net loss | $ (12,730) | $ (20,426) |
Adjustments to reconcile net loss to net cash flows used in operating activities: | ||
Share-based compensation expense | 292 | 872 |
Amortization of financing costs | 224 | 224 |
Net changes in operating assets and liabilities: | ||
Other assets | (3,321) | 7,226 |
Other liabilities and accrued expenses | (2,959) | (2,276) |
Net cash flows used in operating activities | (24,531) | (48,758) |
Financing activities: | ||
Net cash flows provided by (used in) financing activities | 3,845 | (183) |
Net change in cash and cash equivalents | (5,622) | 11,836 |
Cash and cash equivalents, beginning of period | 16,147 | 34,155 |
Cash and cash equivalents, end of period | 10,525 | 16,147 |
Supplemental disclosure of cash information: | ||
Cash paid for interest | 2,022 | 1,753 |
Cash paid for income taxes | (1,984) | (14,354) |
Parent Company | ||
Operating Activities | ||
Net loss | (12,730) | (20,426) |
Adjustments to reconcile net loss to net cash flows used in operating activities: | ||
Equity in net loss of subsidiaries | 5,500 | 12,661 |
Share-based compensation expense | 292 | 872 |
Amortization of financing costs | 224 | 224 |
Net changes in operating assets and liabilities: | ||
Other assets | (693) | 0 |
Other liabilities and accrued expenses | 8,147 | 8,264 |
Net cash flows used in operating activities | 740 | 1,595 |
Financing activities: | ||
Capital contributions | (1,600) | 0 |
Net cash flows provided by (used in) financing activities | (1,600) | 0 |
Net change in cash and cash equivalents | (860) | 1,595 |
Cash and cash equivalents, beginning of period | 1,966 | 371 |
Cash and cash equivalents, end of period | 1,106 | 1,966 |
Supplemental disclosure of cash information: | ||
Cash paid for interest | 1,656 | 1,656 |
Cash paid for income taxes | $ (801) | $ 5,763 |
Schedule II - Condensed Finan_6
Schedule II - Condensed Financial Information of Registrant Notes to Condensed Financial Information (Details) - Senior unsecured notes - USD ($) | Apr. 26, 2017 | Dec. 31, 2020 |
Condensed Financial Statements, Captions [Line Items] | ||
Debt instrument, face amount | $ 25,000,000 | |
Debt instrument, term | 5 years | |
Debt instrument, interest rate, stated percentage | 6.625% | 6.625% |
Proceeds from notes payable, net of issuance costs | $ 23,900,000 | |
Parent Company | ||
Condensed Financial Statements, Captions [Line Items] | ||
Debt instrument, face amount | $ 25,000,000 | |
Debt instrument, term | 5 years | |
Debt instrument, interest rate, stated percentage | 6.625% | |
Proceeds from notes payable, net of issuance costs | $ 23,900,000 |
Schedule IV - Reinsurance Reins
Schedule IV - Reinsurance Reinsurance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | ||
Premiums earned, gross amount | $ 0 | $ 149,609 |
Premiums earned, ceded to other companies | 0 | (66,322) |
Premiums earned, assumed from other companies | 0 | 26,954 |
Net premiums earned | $ 0 | $ 110,241 |
Premiums earned, percent of amount assumed to net | 0.00% | 24.50% |
Schedule V - Valuation and qu_2
Schedule V - Valuation and qualifying accounts Valuation and Qualifying Accounts Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Allowance for uncollectible receivables | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at the beginning of the year | $ 800 | $ 5,115 |
Charged to Expenses | 169 | 3,596 |
Other Additions | 0 | 0 |
Deductions | (169) | (7,911) |
Balance at the end of the year | 800 | 800 |
Valuation allowance for deferred tax assets | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at the beginning of the year | 3,143 | 25,415 |
Charged to Expenses | 1,410 | 2,113 |
Other Additions | 0 | 0 |
Deductions | 0 | (24,385) |
Balance at the end of the year | $ 4,553 | $ 3,143 |
Schedule VI - Supplemental in_2
Schedule VI - Supplemental information concerning property-casualty insurance operations Supplemental information concerning property-casualy insurance operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Abstract] | |||
Deferred policy acquisition costs | $ 0 | $ 0 | $ 5,918 |
Claims liabilities | 0 | 0 | $ 226,487 |
Net premiums earned | 0 | 110,241 | |
Net investment income | 0 | 1,902 | |
Claims and claims adjustment expense incurred, current year | 0 | 78,612 | |
Prior Year Claims and Claims Adjustment Expense | 0 | 2,155 | |
Amortization of deferred policy acquisition costs | 0 | 11,825 | |
Paid claims and claims adjustment expenses | 0 | 112,146 | |
Gross premiums written | $ 0 | $ 160,684 |
Uncategorized Items - afh-20201
Label | Element | Value |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Disposal Group, Including Discontinued Operations | us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsDisposalGroupIncludingDiscontinuedOperations | $ 747,000 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Including Disposal Group and Discontinued Operations | us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsIncludingDisposalGroupAndDiscontinuedOperations | $ 34,902,000 |