Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 05, 2015 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | James River Group Holdings, Ltd. | |
Entity Central Index Key | 1,620,459 | |
Trading Symbol | jrvr | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 28,769,487 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,015 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Fixed maturity securities: | ||
Available-for-sale, at fair value (amortized cost: 2015 - $878,724; 2014 - $737,916) | $ 888,480 | $ 756,963 |
Trading, at fair value (amortized cost: 2015 - $1,249; 2014 - $7,324) | 1,251 | 7,388 |
Equity securities available-for-sale, at fair value (cost: 2015 - $72,346; 2014 - $64,348) | 74,453 | 67,905 |
Bank loan participations held-for-investment, at amortized cost, net of allowance | 213,625 | 239,511 |
Short-term investments | 50,225 | 131,856 |
Other invested assets | 74,301 | 33,622 |
Total invested assets | 1,302,335 | 1,237,245 |
Cash and cash equivalents | 76,561 | 73,383 |
Accrued investment income | 8,281 | 7,273 |
Premiums receivable and agents' balances, net | 197,962 | 162,527 |
Reinsurance recoverable on unpaid losses | 133,273 | 127,254 |
Reinsurance recoverable on paid losses | 5,835 | 1,725 |
Prepaid reinsurance premiums | 37,709 | 29,445 |
Deferred policy acquisition costs | 72,673 | 60,202 |
Intangible assets, net | 39,678 | 40,125 |
Goodwill | 181,831 | 181,831 |
Other assets | 39,977 | 38,282 |
Total assets | 2,096,115 | 1,959,292 |
Liabilities: | ||
Reserve for losses and loss adjustment expenses | 779,009 | 716,296 |
Unearned premiums | 329,867 | 277,579 |
Payables to reinsurers | 20,566 | 19,272 |
Senior debt | 88,300 | 88,300 |
Junior subordinated debt | 104,055 | 104,055 |
Accrued expenses | 29,250 | 31,107 |
Other liabilities | 37,652 | 34,762 |
Total liabilities | $ 1,388,699 | $ 1,271,371 |
Commitments and contingent liabilities | ||
Shareholders' equity: | ||
Common Shares - 2015 and 2014: $0.0002 par value; 200,000,000 shares authorized; 2015 and 2014: 28,769,487 and 28,540,350 shares issued and outstanding, respectively | $ 6 | $ 6 |
Preferred Shares - 2015 and 2014: $0.00125 par value; 20,000,000 convertible shares authorized; no shares issued and outstanding | ||
Additional paid-in capital | $ 630,272 | $ 628,236 |
Retained earnings | 68,252 | 41,323 |
Accumulated other comprehensive income | 8,886 | 18,356 |
Total shareholders' equity | 707,416 | 687,921 |
Total liabilities and shareholders' equity | $ 2,096,115 | $ 1,959,292 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Available-for-sale debt securities, amortized cost (in dollars) | $ 878,724 | $ 737,916 |
Trading securities, debt, amortized cost (in dollars) | 1,249 | 7,324 |
Available-for-sale equity securities, amortized cost (in dollars) | $ 72,346 | $ 64,348 |
Common stock, par value (in dollars per share) | $ 0.0002 | $ 0.0002 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 28,769,487 | 28,540,350 |
Common stock, shares outstanding | 28,769,487 | 28,540,350 |
Preferred stock par value (in dollars per share) | $ 0.00125 | $ 0.00125 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income and Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues | ||||
Gross written premiums | $ 148,236 | $ 171,415 | $ 463,505 | $ 415,616 |
Ceded written premiums | (25,308) | (17,579) | (73,104) | (47,998) |
Net written premiums | 122,928 | 153,836 | 390,401 | 367,618 |
Change in net unearned premiums | (223) | (53,847) | (44,625) | (81,561) |
Net earned premiums | 122,705 | 99,989 | 345,776 | 286,057 |
Net investment income | 9,510 | 9,996 | 34,496 | 33,189 |
Net realized investment (losses) gains | (17) | 2,033 | (2,473) | (1,678) |
Other income | 925 | (201) | 2,018 | 740 |
Total revenues | 133,123 | 111,817 | 379,817 | 318,308 |
Expenses | ||||
Losses and loss adjustment expenses | 66,718 | 54,486 | 209,133 | 171,936 |
Other operating expenses | 43,387 | 34,114 | 119,764 | 98,971 |
Other expenses | 69 | 2,459 | 207 | 2,848 |
Interest expense | 1,769 | 1,557 | 5,217 | 4,661 |
Amortization of intangible assets | 149 | 149 | 447 | 447 |
Total expenses | 112,092 | 92,765 | 334,768 | 278,863 |
Income before taxes | 21,031 | 19,052 | 45,049 | 39,445 |
Income tax expense | 2,070 | 1,884 | 4,222 | 3,626 |
Net income | 18,961 | 17,168 | 40,827 | 35,819 |
Other comprehensive income: | ||||
Net unrealized gains (losses), net of taxes of $(128) and $(1,272) in 2015 and $(776) and $2,882 in 2014 | 1,586 | (4,420) | (9,470) | 7,084 |
Total comprehensive income | $ 20,547 | $ 12,748 | $ 31,357 | $ 42,903 |
Per share data: | ||||
Basic earnings per share | $ 0.66 | $ 0.60 | $ 1.43 | $ 1.26 |
Diluted earnings per share | 0.64 | 0.60 | 1.40 | 1.24 |
Dividend declared per share | $ 0.16 | $ 2.45 | $ 0.48 | $ 2.45 |
Weighted-average common shares outstanding: | ||||
Basic | 28,735,087 | 28,540,350 | 28,608,398 | 28,540,350 |
Diluted | 29,418,251 | 28,793,815 | 29,244,520 | 28,787,500 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Income and Comprehensive Income (Unaudited) (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Statement [Abstract] | ||||
Tax on net unrealized gains (losses) | $ (128) | $ (776) | $ (1,272) | $ 2,882 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Common Shares | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Total |
Balances at Dec. 31, 2013 | $ 6 | $ 627,647 | $ 66,636 | $ 7,201 | $ 701,490 |
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Net income | 35,819 | 35,819 | |||
Other comprehensive income | 7,084 | 7,084 | |||
Dividends | (69,998) | (69,998) | |||
Compensation expense under stock incentive plans | 312 | 312 | |||
Balances at Sep. 30, 2014 | 6 | 627,959 | 32,457 | 14,285 | 674,707 |
Balances at Dec. 31, 2014 | 6 | 628,236 | 41,323 | 18,356 | 687,921 |
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Net income | 40,827 | 40,827 | |||
Other comprehensive income | (9,470) | (9,470) | |||
Dividends | (13,898) | (13,898) | |||
Exercise of stock options and related excess tax benefits | (758) | (758) | |||
Compensation expense under stock incentive plans | 2,794 | 2,794 | |||
Balances at Sep. 30, 2015 | $ 6 | $ 630,272 | $ 68,252 | $ 8,886 | $ 707,416 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Operating activities | ||
Net cash provided by operating activities | $ 104,279 | $ 88,221 |
Securities available-for-sale: | ||
Purchases - fixed maturity securities | (245,346) | (144,487) |
Sales - fixed maturity securities | 29,276 | 28,101 |
Maturities and calls - fixed maturity securities | 74,460 | 33,027 |
Purchases - equity securities | (7,998) | (8,133) |
Sales - equity securities | 16,612 | |
Bank loan participations: | ||
Purchases | (96,896) | (203,980) |
Sales | 90,293 | 113,819 |
Maturities | 29,876 | 57,652 |
Other invested assets: | ||
Purchases | (47,099) | (4,800) |
Disposals | 35 | 9,470 |
Maturities and repayments | 6,957 | |
Short-term investments, net | 81,631 | (43,730) |
Securities receivable or payable, net | 39 | 37,781 |
Purchases of property and equipment | (1,185) | (909) |
Net cash used in investing activities | (85,957) | (109,577) |
Financing activities | ||
Dividends paid | (13,735) | (65,045) |
Senior debt issuances | 20,300 | |
Debt issue costs paid | (395) | |
Issuances of common stock | 863 | |
Common stock repurchases | (3,715) | |
Stock option excess tax benefit | 2,094 | |
Repayments of financing obligations net of proceeds | (488) | (475) |
Other financing | (163) | |
Net cash used in financing activities | (15,144) | (45,615) |
Change in cash and cash equivalents | 3,178 | (66,971) |
Cash and cash equivalents at beginning of period | 73,383 | 158,604 |
Cash and cash equivalents at end of period | 76,561 | 91,633 |
Supplemental information | ||
Interest paid | 5,490 | 4,913 |
U.S. income taxes paid (net of refunds) | $ (1,532) | $ 5,131 |
Accounting Policies
Accounting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Accounting Policies | 1. Accounting Policies Organization James River Group Holdings, Ltd. (referred to as “JRG Holdings” or the “Company”) is an exempted holding company registered in Bermuda, organized for the purpose of acquiring and managing insurance and reinsurance entities. The Company owns five insurance companies based in the United States (“U.S.”) focused on specialty insurance niches and a Bermuda-based reinsurance company, as described below: · James River Group, Inc. (“James River Group”) is a Delaware domiciled insurance holding company formed in 2002, which owns all of the Company’s U.S.-based subsidiaries, either directly or indirectly through one of its wholly-owned U.S. subsidiaries. James River Group oversees the Company’s U.S. insurance operations and maintains all of the outstanding U.S. debt. · James River Insurance Company (“James River Insurance”) is an Ohio domiciled excess and surplus lines insurance company that, with its wholly-owned insurance subsidiary, James River Casualty Company, is authorized to write business in every state and the District of Columbia. · Falls Lake National Insurance Company (“Falls Lake National”) is an Ohio domiciled insurance company which wholly-owns Stonewood Insurance Company (“Stonewood Insurance”), a North Carolina domiciled company, and Falls Lake General Insurance Company, an Ohio domiciled company. Falls Lake National began writing specialty admitted program business in late 2013. · Stonewood Insurance is a workers’ compensation insurance company that writes insurance primarily for the residential construction and light manufacturing industries. Stonewood Insurance writes individual risk workers’ compensation coverage in North Carolina, Virginia, South Carolina, and Tennessee. · JRG Reinsurance Company, Ltd. (“JRG Re”) was formed in 2007 and commenced operations in 2008. JRG Re, a Bermuda domiciled reinsurer, provides reinsurance to U.S. third parties and to the Company’s U.S.-based insurance subsidiaries. Basis of Presentation The accompanying condensed consolidated financial statements and notes have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and do not contain all of the information and footnotes required by U.S. GAAP for complete financial statements. The condensed consolidated financial statements include the results of the Company and its subsidiaries from their respective dates of inception or acquisition, as applicable. Readers are urged to review the Company’s 2014 audited consolidated financial statements for a more complete description of the Company’s business and accounting policies. In the opinion of management, all adjustments necessary for a fair presentation of the condensed consolidated financial statements have been included. Such adjustments consist only of normal recurring items. Interim results are not necessarily indicative of results of operations for the full year. The consolidated balance sheet as of December 31, 2014 was derived from the Company’s audited annual consolidated financial statements. Intercompany transactions and balances have been eliminated. Estimates and Assumptions Preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying disclosures. Those estimates are inherently subject to change, and actual results may ultimately differ from those estimates. Variable Interest Entities Entities that do not have sufficient equity at risk to allow the entity to finance its activities without additional financial support or in which the equity investors, as a group, do not have the characteristic of a controlling financial interest are referred to as variable interest entities (“VIE”). A VIE is consolidated by the variable interest holder that is determined to have the controlling financial interest (primary beneficiary) as a result of having both (1) the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance and (2) the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. The Company determines whether it is the primary beneficiary of an entity subject to consolidation based on a qualitative assessment of the VIE’s capital structure, contractual terms, nature of the VIE’s operations and purpose, and the Company’s relative exposure to the related risks of the VIE on the date it becomes initially involved in the VIE. The Company reassesses its VIE determination with respect to an entity on an ongoing basis. The Company holds interests in VIEs through certain equity method investments in limited liability companies (“LLCs”) included in “other invested assets” in the accompanying condensed consolidated balance sheets. The Company has determined that it should not consolidate any of the VIEs as it is not the primary beneficiary in any of the relationships. Although the investments resulted in the Company holding variable interests in the entities, they did not empower the Company to direct the activities that most significantly impact the economic performance of the entities. The Company’s investments related to these VIEs totaled $26.0 million and $25.1 million as of September 30, 2015 and December 31, 2014, respectively, representing the Company’s maximum exposure to loss. Prospective Accounting Standards In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis In May 2015, the FASB issued ASU 2015-09, Insurance (Topic 944), Disclosures about Short-Duration Contracts |
Investments
Investments | 9 Months Ended |
Sep. 30, 2015 | |
Investments [Abstract] | |
Investments | 2. Investments The Company’s available-for-sale investments are summarized as follows: Cost or Gross Gross Fair (in thousands) September 30, 2015 Fixed maturity securities: State and municipal $ 112,053 $ 7,841 $ (41 ) $ 119,853 Residential mortgage-backed 135,851 2,255 (1,394 ) 136,712 Corporate 342,689 5,620 (7,887 ) 340,422 Commercial mortgage and asset-backed 134,420 1,989 (117 ) 136,292 Obligations of U.S. government corporations and agencies 94,872 1,107 (3 ) 95,976 U.S. Treasury securities and obligations guaranteed by the U.S. government 56,814 454 (3 ) 57,265 Redeemable preferred stock 2,025 - (65 ) 1,960 Total fixed maturity securities 878,724 19,266 (9,510 ) 888,480 Equity securities 72,346 3,908 (1,801 ) 74,453 Total investments available-for-sale $ 951,070 $ 23,174 $ (11,311 ) $ 962,933 December 31, 2014 Fixed maturity securities: State and municipal $ 90,715 $ 8,509 $ (178 ) $ 99,046 Residential mortgage-backed 113,997 2,661 (1,409 ) 115,249 Corporate 261,574 8,742 (2,434 ) 267,882 Commercial mortgage and asset-backed 111,056 2,429 (144 ) 113,341 Obligations of U.S. government corporations and agencies 100,376 1,431 (532 ) 101,275 U.S. Treasury securities and obligations guaranteed by the U.S. government 58,173 289 (193 ) 58,269 Redeemable preferred stock 2,025 – (124 ) 1,901 Total fixed maturity securities 737,916 24,061 (5,014 ) 756,963 Equity securities 64,348 5,182 (1,625 ) 67,905 Total investments available-for-sale $ 802,264 $ 29,243 $ (6,639 ) $ 824,868 The amortized cost and fair value of available-for-sale investments in fixed maturity securities at September 30, 2015 are summarized, by contractual maturity, as follows: Cost or Fair (in thousands) One year or less $ 84,559 $ 85,179 After one year through five years 267,065 266,232 After five years through ten years 105,309 106,787 After ten years 149,495 155,318 Residential mortgage-backed 135,851 136,712 Commercial mortgage and asset-backed 134,420 136,292 Redeemable preferred stock 2,025 1,960 Total $ 878,724 $ 888,480 Actual maturities may differ for some securities because borrowers have the right to call or prepay obligations with or without penalties. The following table shows the Company’s gross unrealized losses and fair value for available-for-sale securities aggregated by investment category and the length of time that individual securities have been in a continuous unrealized loss position: Less Than 12 Months 12 Months or More Total Fair Gross Fair Gross Fair Gross (in thousands) September 30, 2015 Fixed maturity securities: State and municipal $ 9,587 $ (41 ) – – $ 9,587 $ (41 ) Residential mortgage-backed 23,275 (161 ) 43,109 (1,233 ) 66,384 (1,394 ) Corporate 118,402 (3,363 ) 4,817 (4,524 ) 123,219 (7,887 ) Commercial mortgage and asset-backed 42,098 (58 ) 18,055 (59 ) 60,153 (117 ) Obligation of U.S. government corporations and agencies – – 4,047 (3 ) 4,047 (3 ) U.S. Treasury securities and obligations guaranteed by the U.S. government – – 2,202 (3 ) 2,202 (3 ) Redeemable preferred stock 1,960 (65 ) – – 1,960 (65 ) Total fixed maturity securities 195,322 (3,688 ) 72,230 (5,822 ) 267,552 (9,510 ) Equity securities 9,342 (265 ) 12,071 (1,536 ) 21,413 (1,801 ) Total investments available-for-sale $ 204,664 $ (3,953 ) $ 84,301 $ (7,358 ) $ 288,965 $ (11,311 ) Less Than 12 Months 12 Months or More Total Fair Gross Fair Gross Fair Gross (in thousands) December 31, 2014 Fixed maturity securities: State and municipal $ 3,197 $ (176 ) $ 247 $ (2 ) $ 3,444 $ (178 ) Residential mortgage-backed 2,072 (2 ) 47,594 (1,407 ) 49,666 (1,409 ) Corporate 25,885 (235 ) 22,353 (2,199 ) 48,238 (2,434 ) Commercial mortgage and asset-backed 23,894 (118 ) 8,742 (26 ) 32,636 (144 ) Obligations of U.S. government corporations and agencies 202 – 48,029 (532 ) 48,231 (532 ) U.S. Treasury securities and obligations guaranteed by the U.S. government 13,055 (24 ) 19,383 (169 ) 32,438 (193 ) Redeemable preferred stock – – 1,901 (124 ) 1,901 (124 ) Total fixed maturity securities 68,305 (555 ) 148,249 (4,459 ) 216,554 (5,014 ) Equity securities 1,361 (205 ) 10,621 (1,420 ) 11,982 (1,625 ) Total investments available-for-sale $ 69,666 $ (760 ) $ 158,870 $ (5,879 ) $ 228,536 $ (6,639 ) As of September 30, 2015, the Company held securities of 88 issuers that were in an unrealized loss position with a total fair value of $289.0 million and gross unrealized losses of $11.3 million. None of the fixed maturity securities with unrealized losses has ever missed, or been delinquent on, a scheduled principal or interest payment. At September 30, 2015, 87.1% of the Company’s fixed maturity security portfolio was rated “A-“ or better by Standard & Poor’s or received an equivalent rating from another nationally recognized rating agency. Fixed maturity securities with ratings below investment grade by Standard & Poor’s or another nationally recognized rating agency at September 30, 2015 had an aggregate fair value of $10.3 million and an aggregate net unrealized loss of $4.7 million. The Company previously held two municipal bonds issued by the Commonwealth of Puerto Rico. Puerto Rico’s weak economic conditions and heavy debt burden heightened the risk of default on the bonds and management concluded that the bonds, which had been downgraded to below investment grade, were other-than-temporarily impaired at June 30, 2014. The Company recognized impairment losses of $1.4 million on these bonds for the year ended December 31, 2014 and $660,000 for the three months ended March 31, 2015. The bonds were sold during the second quarter of 2015 and a net realized gain of $22,000 was recognized on the sales. Management concluded that none of the other fixed maturity securities with an unrealized loss at September 30, 2015 or December 31, 2014 experienced an other-than-temporary impairment. Management does not intend to sell available-for-sale securities in an unrealized loss position, and it is not “more likely than not” that the Company will be required to sell these securities before a recovery in their value to their amortized cost basis occurs. Management also concluded that none of the equity securities with an unrealized loss at September 30, 2015 or December 31, 2014 experienced an other-than-temporary impairment. Management has evaluated the near-term prospects of these equity securities in relation to the severity and duration of the impairment, and management has the ability and intent to hold these securities until such time that they recover their fair value. The Company holds participations in two loans issued by companies that produce and supply power to Puerto Rico through power purchase agreements with Puerto Rico Electric Power Authority (“PREPA”), a public corporation and governmental agency of the Commonwealth of Puerto Rico. PREPA’s credit strength and ability to make timely payments has been impacted by the economic conditions in Puerto Rico, thus raising doubt about the companies’ ability to meet the debt obligations held by the Company. Management concluded that the loans were impaired at December 31, 2014 and established an allowance for credit losses on the loans of $752,000. After recording this impairment, these loans had a carrying value of $7.1 million at December 31, 2014 and unpaid principal of $8.4 million. At September 30, 2015, the allowance for credit losses on these loans was $501,000. The loans had a carrying value of $4.7 million at September 30, 2015 and unpaid principal of $5.6 million. The allowance for credit losses on these loans at September 30, 2014 was $742,000. A number of the Company’s bank loans are to oil and gas companies in the energy sector. The market values of these loans declined significantly in the fourth quarter of 2014 in response to declining energy prices. The declines in market values continued into 2015 and, after discussions with our independent investment manager, management decided to sell certain energy sector loans where there was an increased risk associated with the issuer’s ability to meet all principal and interest obligations as they became due. In total, the Company’s investments in bank loans to oil and gas companies in the energy sector had a carrying value of $21.0 million and an unrealized loss of $5.0 million at September 30, 2015. Management concluded that none of these loans were impaired as of September 30, 2015. There was no allowance for credit losses on these loans at September 30, 2014. Management also concluded that one non-energy sector loan held at September 30, 2015 should be considered impaired and an allowance for credit losses of $29,000 was established on the loan. After recording this impairment, the loan had a carrying value of $695,000 at September 30, 2015 and unpaid principal of $724,000. Bank loan participations generally have a credit rating that is below investment grade (i.e. below “BBB-” for Standard & Poor’s) at the date of purchase. These bank loans are primarily senior, secured floating-rate debt rated “B” or “BB” by Standard & Poor’s or an equivalent rating from another nationally recognized rating agency. These bank loans include assignments of, and participations in, performing and non-performing senior corporate debt generally acquired through primary bank syndications and in secondary markets. Bank loans consist of, but are not limited to, term loans, the funded and unfunded portions of revolving credit loans, and other similar loans and investments. Management believed that it was probable at the time that these loans were acquired that the Company would be able to collect all contractually required payments receivable. Generally, the accrual of interest on a bank loan participation is discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about further collectability of principal or interest. A bank loan participation may remain on accrual status if it is in the process of collection and is either guaranteed or well secured. Generally, bank loan participations are restored to accrual status when the obligation is brought current, has performed in accordance with the contractual terms for a reasonable period of time, and the ultimate collectability of the total contractual principal and interest is no longer in doubt. Interest received on nonaccrual loans generally is reported as investment income. There were no bank loans on nonaccrual status at September 30, 2015 or December 31, 2014. The allowance for credit losses is maintained at a level believed adequate by management to absorb estimated probable credit losses. Management’s periodic evaluation of the adequacy of the allowance is based on consultations and advice of the Company’s independent investment manager, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral, current economic conditions, and other relevant factors. The Company generally records an allowance equal to the difference between the fair value and the amortized cost of bank loans that it has determined to be impaired as a practical expedient for an estimate of probable future cash flows to be collected on those bank loans. Bank loans are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The average recorded investment in impaired bank loans was $6.3 million and $4.1 million during the nine months ended September 30, 2015 and 2014, respectively. Investment income of $139,000 and $59,000, respectively, was recognized during the time within those periods that the loans were impaired. The Company recorded realized gains of $143,000 and $346,000, respectively, in the three months and nine months ended September 30, 2015 for changes in the fair value of impaired bank loans. In the three months and nine months ended September 30, 2014, the Company recorded realized gains of $221,000 and realized losses of $742,000, respectively, for changes in the fair value of impaired bank loans. Changes in unrealized gains or losses on securities held for trading are recorded as trading gains or losses within net investment income. Net investment income for the three months and nine months ended September 30, 2015 includes $21,000 and $4,000, respectively, of net trading gains of which $1,000 (for both the three and nine month periods) relates to securities held at September 30, 2015. The Company’s realized gains and losses are summarized as follows: Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Fixed maturity securities: Gross realized gains $ 130 $ 29 $ 1,417 $ 423 Gross realized losses (72 ) (91 ) (736 ) (1,503 ) 58 (62 ) 681 (1,080 ) Bank loan participations: Gross realized gains 421 736 953 1,714 Gross realized losses (496 ) (3 ) (4,150 ) (981 ) (75 ) 733 (3,197 ) 733 Equity securities: Gross realized gains - - - 88 Gross realized losses - - - (842 ) - - - (754 ) Short-term investments and other: Gross realized gains 4 1,362 52 1,362 Gross realized losses (4 ) - (9 ) (1,939 ) - 1,362 43 (577 ) Total $ (17 ) $ 2,033 $ (2,473 ) $ (1,678 ) Realized investment gains or losses are determined on a specific identification basis. The Company invests selectively in private debt and equity opportunities. These investments, which together comprise the Company’s other invested assets, are primarily focused in renewable energy, limited partnerships, and bank holding companies. Investment Income Carrying Value Three Months Ended Nine Months Ended September 30, December 31, September 30, September 30, 2015 2014 2015 2014 2015 2014 (in thousands) Category Renewable energy LLCs (a) $ 26,021 $ 25,119 $ (659 ) $ 697 $ 3,956 $ 4,737 Renewable energy bridge financing notes (b) 30,078 - 984 - 2,483 - Limited partnerships (c) 13,702 4,003 (1,038 ) (105 ) (1,112 ) 127 Bank holding companies (d) 4,500 4,500 86 86 257 314 Other (e) - - - 3 - 184 Total other invested assets $ 74,301 $ 33,622 $ (627 ) $ 681 $ 5,584 $ 5,362 (a) Equity interests ranging from 2.7% to 33.3% in various LLCs whose principal objective is capital appreciation and income generation from owning and operating renewable energy production facilities (wind and solar). The LLCs are managed by an affiliate of the Company’s largest shareholder and the Company’s Chairman and Chief Executive Officer has invested in certain of these LLCs. The equity method is used to account for the Company’s LLC investments. Income for the LLCs primarily reflects adjustments to the carrying values of investments in renewable energy projects to their determined fair values. The fair value adjustments are included in revenues for the LLCs. Expenses for the LLCs are not significant and are comprised of administrative and interest expenses. The Company received cash distributions from these investments totaling $3.1 million and $3.3 million in the nine months ended September 30, 2015 and 2014, respectively. In March 2014, the Company sold its interest in one of the LLCs for $5.9 million and a $1.9 million realized loss was recognized on the sale. Investment income of $3.6 million was recognized on this investment in the three months ended March 31, 2014. (b) Investments in bridge loans for renewable energy projects. The notes, all with affiliates of the Company’s largest shareholder, generally mature in less than one year and carry primarily variable rates of interest ranging from 7.3% to 15.0%. Original discounts and commitment fees received are recognized over the terms of the notes under the effective interest method. During the nine months ended September 30, 2015, the Company invested a total of $36.3 million in these notes and has received maturities and partial repayments totaling $7.0 million. (c) Investments in limited partnerships that invest in concentrated portfolios of high yield bonds of companies undergoing financial stress, publicly-traded small cap equities, loans of middle market private equity sponsored companies, and equity tranches of collateralized loan obligations (CLOs). Income from the partnerships is recognized under the equity method of accounting. The Company has outstanding commitments to invest another $9.2 million in limited partnerships. (d) Net investment income for the nine months ended September 30, 2014 includes $57,000 related to a previously held equity investment in a bank holding company (“Predecessor Bank Holding Company”). On July 4, 2014, the Predecessor Bank Holding Company merged with and into another bank holding company (the “Surviving Bank Holding Company”). In exchange for its shares of the Predecessor Bank Holding Company, the Company received $354,000 in cash and $6.4 million of common shares in the Surviving Bank Holding Company, and the realized investment gain on the exchange was $1.4 million. The common shares of the Surviving Bank Holding Company are carried as available for-sale equity securities as they are publicly-traded and the Company does not have significant influence over the Surviving Bank Holding Company. The Company also holds $4.5 million of subordinated notes issued by a company that was substantially owned by the Predecessor Bank Holding Company (the “Bank Affiliate”). The $4.5 million of subordinated notes issued by the Bank Affiliate became debt of the Surviving Bank Holding Company. Interest on the notes, which mature on August 12, 2023, is fixed at 7.6% per annum. The Chairman and Chief Executive Officer of the Company previously served as Chairman of the Predecessor Bank Holding Company and the Bank Affiliate. Effective July 4, 2014, the Company’s Chairman and Chief Executive Officer became the Lead Independent Director of the Surviving Bank Holding Company. The Chairman and Chief Executive Officer of the Company is a former investor in the Predecessor Bank Holding Company and is now an investor in the Surviving Bank Holding Company. Additionally, one of the Company’s directors is a former investor in the Predecessor Bank Holding Company and is now an investor in the Surviving Bank Holding Company. In addition, this director was a lender to the Bank Affiliate and is now a lender to the Surviving Bank Holding Company. The Company’s Chief Financial Officer is a former investor in the Predecessor Bank Holding Company and the Surviving Bank Holding Company. (e) For the three months and nine months ended September 30, 2014, respectively, income of $3,000 and $184,000 was recognized on a $3.3 million note agreement with two property development companies. The note, which carried a fixed interest rate of 11.10%, was repaid in full on July 3, 2014. The Bank Holding Company also entered into note agreements with the same property development companies. On December 19, 2014, the Company purchased a $1.0 million certificate of deposit issued by the Surviving Bank Holding Company. The certificate of deposit, which matures on December 19, 2015, is carried as a short-term investment. Interest income of $1,000 and $4,000 was recognized on this investment for the three months and nine months ended September 30, 2015, respectively. Two of the Company’s directors are also directors of First Wind Capital, LLC (“First Wind”), which is an affiliate of the Company’s largest shareholder. At December 31, 2014, the Company held fixed maturity securities with a fair value of $12.6 million issued by First Wind. These securities were called in March 2015, resulting in a realized gain of $845,000. Also at December 31, 2014, the Company held a bank loan participation with a carrying value of $4.6 million from an affiliate of First Wind. The loan was repaid in full in January 2015. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 3. Goodwill and Intangible Assets On December 11, 2007, the Company completed an acquisition of James River Group by acquiring 100% of the outstanding shares of James River Group common stock, referred to herein as the “Merger”. The transaction was accounted for under the purchase method of accounting, and goodwill and intangible assets were recognized by the Company as a result of the transaction. Goodwill resulting from the Merger was $181.8 million at September 30, 2015 and December 31, 2014. The gross carrying amounts and accumulated amortization for each major specifically identifiable intangible asset class were as follows: September 30, 2015 December 31, 2014 Life (Years) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization ($ in thousands) Intangible Assets Trademarks Indefinite $ 22,200 $ – $ 22,200 $ – Insurance licenses and authorities Indefinite 9,164 – 9,164 – Identifiable intangibles not subject to amortization 31,364 – 31,364 – Broker relationships 24.6 11,611 3,297 11,611 2,850 Identifiable intangible assets subject to amortization 11,611 3,297 11,611 2,850 $ 42,975 $ 3,297 $ 42,975 $ 2,850 |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 4. Earnings Per Share The following represents a reconciliation of the numerator and denominator of the basic and diluted earnings per share computations contained in the condensed consolidated financial statements. Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Net income to shareholders $ 18,961 $ 17,168 $ 40,827 $ 35,819 Weighted average common shares outstanding: Basic 28,735,087 28,540,350 28,608,398 28,540,350 Common share equivalents 683,164 253,465 636,122 247,150 Diluted 29,418,251 28,793,815 29,244,520 28,787,500 Earnings per share: Basic $ 0.66 $ 0.60 $ 1.43 $ 1.26 Common share equivalents (0.02 ) - (0.03 ) (.02 ) Diluted $ 0.64 $ 0.60 $ 1.40 $ 1.24 Common share equivalents relate to stock options and restricted share units (“RSU’s”). For the three months ended September 30, 2015 and 2014, common share equivalents of 10,627 and 25,000 shares, respectively, are excluded from the calculations of diluted earnings per share as their effects are anti-dilutive. For the nine months ended September 30, 2015 and 2014, common share equivalents of 5,761 and 25,000 shares, respectively, are excluded from the calculations of diluted earnings per share as their effects are anti-dilutive. |
Reserve for Losses and Loss Adj
Reserve for Losses and Loss Adjustment Expenses | 9 Months Ended |
Sep. 30, 2015 | |
Loss Contingency [Abstract] | |
Reserve for Losses and Loss Adjustment Expenses | 5. Reserve for Losses and Loss Adjustment Expenses The following table provides a reconciliation of the beginning and ending reserve balances for losses and loss adjustment expenses, net of reinsurance, to the gross amounts reported in the condensed consolidated balance sheets: Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Reserve for losses and loss adjustment expenses net of reinsurance recoverables at beginning of period $ 627,504 $ 561,939 $ 589,042 $ 526,985 Add: Incurred losses and loss adjustment expenses net of reinsurance: Current year 76,303 69,838 223,725 191,038 Prior years (9,585 ) (15,352 ) (14,592 ) (19,102 ) Total incurred losses and loss and adjustment expenses 66,718 54,486 209,133 171,936 Deduct: Loss and loss adjustment expense payments net of reinsurance: Current year 4,062 7,341 18,665 12,454 Prior years 44,424 37,602 133,774 114,985 Total loss and loss adjustment expense payments 48,486 44,943 152,439 127,439 Reserve for losses and loss adjustment expenses net of reinsurance recoverables at end of period 645,736 571,482 645,736 571,482 Add: Reinsurance recoverables on unpaid losses and loss adjustment expenses at end of period 133,273 119,400 133,273 119,400 Reserve for losses and loss adjustment expenses gross of reinsurance recoverables on unpaid losses and loss adjustment expenses at end of period $ 779,009 $ 690,882 $ 779,009 $ 690,882 A $9.6 million reserve redundancy developed in the three months ended September 30, 2015 on the reserve for losses and loss adjustment expenses held at December 31, 2014. This favorable reserve development included $10.1 million of favorable development in the Excess and Surplus Lines segment primarily from the 2014 and 2013 accident years. This favorable development occurred because our actuarial studies at September 30, 2015 for the Excess and Surplus Lines segment indicated that our loss experience on our casualty business continues to be below our initial expected loss ratios. The Company also experienced $2.0 million of favorable development on prior accident years for the Specialty Admitted Insurance segment. The favorable development in the Excess and Surplus Lines and Specialty Admitted Insurance segments was partially offset by $2.5 million of adverse reserve development in the Casualty Reinsurance segment, primarily related to one reinsurance relationship from the 2012 and 2011 underwriting years that experienced higher loss development in 2015 than expected. The Company experienced $15.4 million of favorable reserve development in the three months ended September 30, 2014 on the reserve for losses and loss adjustment expenses held at December 31, 2013. This reserve development included $12.0 million of favorable development in the Excess and Surplus Lines segment, primarily from the 2011 and 2010 accident years. This favorable development occurred because our actuarial studies at September 30, 2014 for the Excess and Surplus Lines segment indicated that our loss experience on our casualty business continued to be below our initial expected loss ratios. The Company also experienced $2.2 million of favorable development for the Specialty Admitted Insurance segment and $1.2 million of favorable development in the Casualty Reinsurance segment. A $14.6 million reserve redundancy developed in the nine months ended September 30, 2015 on the reserve for losses and loss adjustment expenses held at December 31, 2014. This favorable reserve development included $18.5 million of favorable development in the Excess and Surplus Lines segment primarily from the 2014 and 2013 accident years. This favorable development occurred because our actuarial studies at September 30, 2015 for the Excess and Surplus Lines segment indicated that our loss experience on our casualty business continues to be below our initial expected loss ratios. The Company also experienced $2.2 million of favorable development on prior accident years for the Specialty Admitted Insurance segment. The favorable development in the Excess and Surplus Lines and Specialty Admitted Insurance segments was partially offset by $6.0 million of adverse reserve development in the Casualty Reinsurance segment, primarily related to one reinsurance relationship from the 2012 and 2011 underwriting years that experienced higher loss development in 2015 than expected. A $19.1 million reserve redundancy developed in the nine months ended September 30, 2014 on the reserve for losses and loss adjustment expenses held at December 31, 2013. This favorable development included $18.3 million of favorable development in the Excess and Surplus Lines segment primarily from the 2011, 2009 and 2007 accident years and $3.3 million of favorable development in the Specialty Admitted Insurance segment. This favorable development was partially offset by $2.4 million of adverse development on assumed business in the Casualty Reinsurance segment. |
Other Comprehensive Income
Other Comprehensive Income | 9 Months Ended |
Sep. 30, 2015 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Other Comprehensive Income | 6. Other Comprehensive Income The following table summarizes the components of comprehensive income: Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Unrealized gains (losses) arising during the period, before U.S. income taxes $ 1,516 $ (5,258 ) $ (10,061 ) $ 8,132 U.S. income taxes 104 787 1,434 (2,200 ) Unrealized gains (losses) arising during the period, net of U.S. income taxes 1,620 (4,471 ) (8,627 ) 5,932 Less reclassification adjustment: Net realized investment gains (losses) 58 (62 ) 681 (1,834 ) U.S. income taxes (24 ) 11 162 682 Reclassification adjustment for investment gains (losses) realized in net income 34 (51 ) 843 (1,152 ) Other comprehensive income $ 1,586 $ (4,420 ) $ (9,470 ) $ 7,084 |
Commitments and Contingent Liab
Commitments and Contingent Liabilities | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingent Liabilities | 7. Commitments and Contingent Liabilities The Company is a party to various lawsuits arising in the ordinary course of its operations. The Company believes that the ultimate resolution of these matters will not materially impact its financial position, cash flows, or results of operations. The Company’s reinsurance subsidiary, JRG Re, entered into two letter of credit facilities with banks as security to third-party reinsureds on reinsurance assumed by JRG Re. JRG Re has established custodial accounts to secure these letters of credit. Under a $100.0 million facility, $95.2 million of letters of credit were issued through September 30, 2015, and assets of $113.4 million were on deposit at September 30, 2015 securing the letters of credit. Under a $102.5 million facility, $43.5 million of letters of credit were issued through September 30, 2015, and assets of $61.8 million were on deposit at September 30, 2015 securing the letters of credit. JRG Re has also established trust accounts to secure its obligations to selected reinsureds. The total amount deposited in the trust accounts at September 30, 2015 was $216.7 million. In May 2015, the Company committed to a $15.0 million investment in a limited partnership that invests in equity tranches of collateralized loan obligations (CLO)s. The Company has funded $10.2 million, and the remaining commitment is $4.8 million as of September 30, 2015. The Company also committed to fund $5.0 million in a limited partnership that invests in loans of middle market private equity sponsored companies. The Company has funded $625,000, and the remaining commitment is $4.4 million as of September 30, 2015. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | 8. Segment Information The Company has four reportable segments: the Excess and Surplus Lines segment, the Specialty Admitted Insurance segment, the Casualty Reinsurance segment, and the Corporate and Other segment. Segment profit (loss) is measured by underwriting profit (loss), which is generally defined as net earned premiums less loss and loss adjustment expenses and other operating expenses of the operating segments. Fee income and expenses of the Excess and Surplus Lines segment is included in that segment’s underwriting profit (loss). Net fee income of $861,000 and $(218,000) was included in underwriting profit for the three months ended September 30, 2015 and 2014, respectively. For the nine months ended September 30, 2015 and 2014, net fee income included in underwriting profit was $1.8 million and $565,000, respectively. Segment results are reported prior to the effects of intercompany reinsurance agreements among the Company’s insurance subsidiaries. The following table summarizes the Company’s segment results: Excess and Surplus Lines Specialty Admitted Insurance Casualty Reinsurance Corporate and Other Total (in thousands) Three Months Ended September 30, 2015 Gross written premiums $ 82,249 $ 22,898 $ 43,089 $ – $ 148,236 Net earned premiums 65,804 10,743 46,158 – 122,705 Underwriting profit of insurance segments 17,047 462 276 – 17,785 Net investment income 3,394 618 5,862 (364 ) 9,510 Interest expense – – – 1,769 1,769 Segment revenues 70,117 11,462 51,871 (327 ) 133,123 Segment goodwill 181,831 – – – 181,831 Segment assets 715,832 154,805 1,115,175 110,303 2,096,115 Excess and Surplus Lines Specialty Admitted Insurance Casualty Reinsurance Corporate and Other Total (in thousands) Three Months Ended September 30, 2014 Gross written premiums $ 61,857 $ 16,211 $ 93,347 $ – $ 171,415 Net earned premiums 51,230 7,185 41,574 – 99,989 Underwriting profit of insurance segments 13,033 162 17 – 13,212 Net investment income 3,472 581 5,269 674 9,996 Interest expense – – – 1,557 1,557 Segment revenues 54,879 7,791 47,123 2,024 111,817 Segment goodwill 181,831 – – – 181,831 Segment assets 696,504 119,367 1,055,793 97,922 1,969,586 Nine Months Ended September 30, 2015 Gross written premiums $ 235,384 $ 61,755 $ 166,366 $ – $ 463,505 Net earned premiums 178,071 30,448 137,257 – 345,776 Underwriting profit of insurance segments 30,259 506 911 – 31,676 Net investment income 10,466 1,720 16,579 5,731 34,496 Interest expense – – – 5,217 5,217 Segment revenues 188,686 32,424 152,868 5,839 379,817 Segment goodwill 181,831 – – – 181,831 Segment assets 715,832 154,805 1,115,175 110,303 2,096,115 Nine Months Ended September 30, 2014 Gross written premiums $ 182,544 $ 40,447 $ 192,625 $ – $ 415,616 Net earned premiums 138,313 18,847 128,897 – 286,057 Underwriting profit (loss) of insurance segments 21,931 (878 ) 424 – 21,477 Net investment income 10,496 1,747 15,441 5,505 33,189 Interest expense – – – 4,661 4,661 Segment revenues 147,205 20,683 145,388 5,032 318,308 Segment goodwill 181,831 – – – 181,831 Segment assets 696,504 119,367 1,055,793 97,922 1,969,586 The following table reconciles the underwriting profit (loss) of the operating segments by individual segment to consolidated income before taxes: Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Underwriting profit (loss) of the insurance segments: Excess and Surplus Lines $ 17,047 $ 13,033 $ 30,259 $ 21,931 Specialty Admitted Insurance 462 162 506 (878 ) Casualty Reinsurance 276 17 911 424 Total underwriting profit of insurance segments 17,785 13,212 31,676 21,477 Other operating expenses of the Corporate and Other segment (4,324 ) (2,041 ) (12,958 ) (5,762 ) Underwriting profit 13,461 11,171 18,718 15,715 Net investment income 9,510 9,996 34,496 33,189 Net realized investment (losses) gains (17 ) 2,033 (2,473 ) (1,678 ) Amortization of intangible assets (149 ) (149 ) (447 ) (447 ) Other income and expenses (5 ) (2,442 ) (28 ) (2,673 ) Interest expense (1,769 ) (1,557 ) (5,217 ) (4,661 ) Income before taxes $ 21,031 $ 19,052 $ 45,049 $ 39,445 |
Other Operating Expenses and Ot
Other Operating Expenses and Other Expenses | 9 Months Ended |
Sep. 30, 2015 | |
Other Operating Expenses And Other Expenses [Abstract] | |
Other Operating Expenses and Other Expenses | 9. Other Operating Expenses and Other Expenses Other operating expenses consist of the following: Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Amortization of policy acquisition costs $ 28,621 $ 22,258 $ 75,523 $ 63,316 Other underwriting expenses of the operating segments 10,442 9,815 31,283 29,893 Other operating expenses of the Corporate and Other segment 4,324 2,041 12,958 5,762 Total $ 43,387 $ 34,114 $ 119,764 $ 98,971 Other expenses for the three and nine months ended September 30, 2015 total $69,000 and $207,000, respectively. Other expenses for the three and nine months ended September 30, 2014 total $2.5 million and $2.8 million respectively. Other expenses for 2015 are all associated with the Company’s minority investment in a partnership that was involved in the construction of a building that the Company was deemed to own for accounting purposes. Deemed ownership of the building also makes up $72,000 and $210,000 of other expenses for the three and nine months ended September 30, 2014. Other expenses for the three months ended September 30, 2014 include $1.8 million of legal, audit and other professional services related to the Company’s initial public offering and $600,000 in employee severance. Similarly, other expenses for the nine months ended September 30, 2014 include $1.9 million of legal, audit and other professional services related to the Company’s initial public offering, $600,000 in employee severance, and $183,000 of due diligence cost for an acquisition which we elected not to pursue. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 10. Fair Value Measurements Three levels of inputs are used to measure fair value of financial instruments: (1) Level 1: quoted price (unadjusted) in active markets for identical assets, (2) Level 2: inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the instrument, and (3) Level 3: inputs to the valuation methodology are unobservable for the asset or liability. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. To measure fair value, the Company obtains quoted market prices for its investment securities. If a quoted market price is not available, the Company uses prices of similar securities. Values for U.S. Treasury and publicly-traded equity securities are generally based on Level 1 inputs which use the market approach valuation technique. The values for all other fixed maturity securities (including state and municipal securities and obligations of U.S. government corporations and agencies) generally incorporate significant Level 2 inputs, and in some cases, Level 3 inputs, using the market approach and income approach valuation techniques. There have been no changes in the Company’s use of valuation techniques since January 1, 2014. The Company reviews fair value prices provided by its outside investment managers for reasonableness by comparing the fair values provided by the managers to those provided by its investment custodian. The Company also reviews and monitors changes in unrealized gains and losses. The Company has not historically adjusted security prices. The Company obtains an understanding of the methods, models and inputs used by the investment managers and independent pricing services, and controls are in place to validate that prices provided represent fair values. The Company’s control process includes, but is not limited to, initial and ongoing evaluation of the methodologies used, a review of specific securities and an assessment for proper classification within the fair value hierarchy, and obtaining and reviewing internal control reports for our investment manager that obtains fair values from independent pricing services. Assets measured at fair value on a recurring basis as of September 30, 2015 are summarized below: Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Level 1 Level 2 Level 3 Total (in thousands) Available-for-sale securities: Fixed maturity securities: State and municipal $ – $ 119,853 $ – $ 119,853 Residential mortgage-backed – 136,712 – 136,712 Corporate – 340,422 - 340,422 Commercial mortgage and asset-backed – 136,292 - 136,292 Obligations of U.S. government corporations and agencies – 95,976 – 95,976 U.S. Treasury securities and obligations guaranteed by the U.S. government 56,534 731 – 57,265 Redeemable preferred stock – 1,960 – 1,960 Total fixed maturity securities 56,534 831,946 - 888,480 Equity securities: Preferred stock – 55,977 – 55,977 Common stock 17,742 734 - 18,476 Total equity securities 17,742 56,711 - 74,453 Total available-for-sale securities $ 74,276 $ 888,657 $ - $ 962,933 Trading securities: Fixed maturity securities $ 1,251 $ – $ – $ 1,251 Short-term investments $ 25,930 $ 24,295 $ – $ 50,225 Assets measured at fair value on a recurring basis as of December 31, 2014 are summarized below: Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Level 1 Level 2 Level 3 Total (in thousands) Available-for-sale securities: Fixed maturity securities: State and municipal $ – $ 99,046 $ – $ 99,046 Residential mortgage-backed – 115,249 – 115,249 Corporate – 267,882 – 267,882 Commercial mortgage and asset-backed – 113,341 – 113,341 Obligations of U.S. government corporations and agencies – 101,275 – 101,275 U.S. Treasury securities and obligations guaranteed by the U.S. government 56,891 1,378 – 58,269 Redeemable preferred stock – 1,901 – 1,901 Total fixed maturity securities 56,891 700,072 – 756,963 Equity securities: Preferred stock – 49,601 – 49,601 Common stock 17,570 734 – 18,304 Total equity securities 17,570 50,335 – 67,905 Total available-for-sale securities $ 74,461 $ 750,407 $ – $ 824,868 Trading securities: Fixed maturity securities $ – $ 7,388 $ – $ 7,388 Short-term investments $ 58,507 $ 73,349 $ – $ 131,856 The beginning and ending balances of assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) was $0, and there was no activity (purchases, sales, transfers) involving Level 3 securities for the three months or nine months ended September 30, 2015 and 2014. Transfers out of Level 3 occur when the Company is able to obtain reliable prices from pricing vendors for securities for which the Company was previously unable to obtain reliable prices. Transfers to Level 3 occur when the Company is unable to obtain reliable prices for securities from pricing vendors and instead must use broker price quotes to value the securities. There were no transfers between Level 1 and Level 2 during the three months or nine months ended September 30, 2015 or 2014. The Company recognizes transfers between levels at the beginning of the reporting period. There were no realized gains or losses included in earnings for the three months or nine months ended September 30, 2015 attributable to the change in unrealized gains or losses relating to Level 3 assets valued at fair value on a recurring basis that are still held at September 30, 2015. The Company measures certain bank loan participations at fair value on a nonrecurring basis during the year as part of the Company’s impairment evaluation when loans are determined by management to be impaired. Assets measured at fair value on a nonrecurring basis are summarized below: Fair Value Measurements Using Quoted Prices In Active Markets for Identical Assets Level 1 Significant Other Observable Inputs Level 2 Significant Unobservable Inputs Level 3 Total (in thousands) September 30, 2015 Bank loan participations held-for-investment $ – $ – $ 695 $ 695 There were no assets measured at fair value on a nonrecurring basis at December 31, 2014. Bank loan participations held-for-investment that were determined to be impaired were written down to their fair value of $695,000 at September 30, 2015, and $7.9 million at September 30, 2014. The allowance for credit losses on bank loan participations was $530,000 at September 30, 2015 and $242,000 at December 31, 2014. The change in the allowance for credit losses on bank loan participations is included in net realized investment gains. In the determination of the fair value for bank loan participations and certain high yield bonds, the Company’s investment manager endeavors to obtain data from multiple external pricing sources. External pricing sources may include brokers, dealers and price data vendors that provide a composite price based on prices from multiple dealers. Such external pricing sources typically provide valuations for normal institutional size trading units of such securities using methods based on market transactions for comparable securities, and various relationships between securities, as generally recognized by institutional dealers. For investments in which the investment manager determines that only one external pricing source is appropriate or if only one external price is available, the relevant investment is generally recorded at fair value based on such price. Investments for which external sources are not available or are determined by the investment manager not to be representative of fair value are recorded at fair value as determined by the investment manager. In determining the fair value of such investments, the investment manager considers one or more of the following factors: type of security held, convertibility or exchangeability of the security, redeemability of the security (including timing of redemptions), application of industry accepted valuation models, recent trading activity, liquidity, estimates of liquidation value, purchase cost, and prices received for securities with similar terms of the same issuer or similar issuers. At September 30, 2015, there were bank loan participations with an unpaid principal balance of $6.3 million and a carrying value of $5.5 million for which external sources were unavailable to determine fair value. At December 31, 2014, there were bank loan participations with an unpaid principal balance of $14.1 million and a carrying value of $12.7 million for which external sources were unavailable to determine fair value. September 30, 2015 December 31, 2014 Carrying Fair Value Carrying Fair Value (in thousands) Assets Available-for-sale: Fixed maturity securities $ 888,480 $ 888,480 $ 756,963 $ 756,963 Equity securities 74,453 74,453 67,905 67,905 Trading: Fixed maturity securities 1,251 1,251 7,388 7,388 Bank loan participations held-for-investment 213,625 205,340 239,511 231,251 Cash and cash equivalents 76,561 76,561 73,383 73,383 Short-term investments 50,225 50,225 131,856 131,856 Other invested assets – notes receivable 34,578 36,157 4,500 6,410 Liabilities Senior debt 88,300 78,449 88,300 79,850 Junior subordinated debt 104,055 82,345 104,055 89,100 The fair values of fixed maturity securities and equity securities have been determined using quoted market prices for securities traded in the public market or prices using bid or closing prices for securities not traded in the public marketplace. The fair values of cash and cash equivalents and short-term investments approximate their carrying values due to their short-term maturity. The fair values of other invested assets-notes receivable, senior debt, and junior subordinated debt at September 30, 2015 and December 31, 2014 were determined by calculating the present value of expected future cash flows under the terms of the note agreements or debt agreements, as applicable, discounted at an estimated market rate of interest at September 30, 2015 and December 31, 2014, respectively. For notes receivable maturing within one year, carrying value was used to approximate fair value. The fair values of bank loan participations held-for-investment, senior debt, and junior subordinated debt at September 30, 2015 and December 31, 2014 were determined using inputs to the valuation methodology that are unobservable (Level 3). |
Capital Stock and Equity Awards
Capital Stock and Equity Awards | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Capital Stock and Equity Awards | 11. Capital Stock and Equity Awards In 2015, vested stock options for 804,875 shares were exercised, increasing the number of common shares issued and outstanding to 28,769,487 at September 30, 2015. The Board of Directors declared the following cash dividends in 2015: Date of Declaration Dividend per Common Share Payable to Shareholders of Record on Payment Date Total Amount February 17, 2015 $ 0.16 March 16, 2015 March 31, 2015 $ 4.6 million May 5, 2015 $ 0.16 June 15, 2015 June 30, 2015 $ 4.6 million August 5, 2015 $ 0.16 September 14, 2015 September 30, 2015 $ 4.6 million On August 27, 2014, the Board of Directors declared a cash dividend of $70.0 million or $2.45 per common share, of which $65.0 million was paid in the three months ended September 30, 2014 and $5.0 million was paid in the three months ended December 31, 2014. Equity Incentive Plans The Company’s shareholders have approved various equity incentive plans, including the Amended and Restated 2009 Equity Incentive Plan (the “Legacy Plan”), the 2014 Long Term Incentive Plan (“2014 LTIP”), and the 2014 Non-Employee Director Incentive Plan (“2014 Director Plan”) (collectively, the “Plans”). All awards issued under the Plans are issued at the discretion of the Board of Directors. Under the Legacy Plan, employees received non-qualified stock options. Options are outstanding under the Legacy Plan; however, no additional awards may be granted. Employees are eligible to receive non-qualified stock options, incentive stock options, share appreciation rights, performance shares, restricted share units (“RSUs”), and other awards under the 2014 LTIP. The maximum number of shares available for issuance under the 2014 LTIP is 3,171,150, and at September 30, 2015, 1,843,481 shares are available for grant. Non-employee directors of the Company are eligible to receive non-qualified stock options, share appreciation rights, performance shares, RSUs, and other awards under the 2014 Director Plan. The maximum number of shares available for issuance under the 2014 Director Plan is 50,000, and at September 30, 2015, 42,860 shares are available for grant. All options issued under the Legacy Plan vest in the event of a change in control. Generally, awards issued under the 2014 LTIP and 2014 Director Plan vest immediately in the event that an award recipient is terminated without Cause (as defined), and in the case of the 2014 LTIP for Good Reason (as defined), during the 12-month period following a Change in Control (as defined). Options The following table summarizes the option activity: Nine Months Ended September 30, 2015 2014 Shares Weighted- Shares Weighted- Outstanding: Beginning of period 3,104,768 $ 17.27 2,166,250 $ 15.51 Granted 10,627 $ 24.32 - $ - Exercised (804,875 ) $ 15.66 - $ - Lapsed (9,810 ) $ 21.00 (5,000 ) $ 15.65 End of period 2,300,710 $ 17.85 2,161,250 $ 15.51 Exercisable, end of period 999,500 $ 15.34 1,668,250 $ 15.49 RSUs The following table summarizes the RSU activity for the nine months ended September 30, 2015: Shares Weighted- Unvested, beginning of period 340,474 $ 21.00 Granted - $ - Unvested, end of period 340,474 $ 21.00 There were no RSUs outstanding in the nine months ended September 30, 2014. Compensation Expense Share based compensation expense is recognized on a straight line basis over the vesting period. The amount of expense and related tax benefit is summarized below: Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Share based compensation expense $ 940 $ 99 $ 2,794 $ 312 U.S. tax benefit on share based compensation expense 260 21 765 62 As of September 30, 2015, the Company had $8.4 million of unrecognized share based compensation expense expected to be charged to earnings over a weighted-average period of 2.6 years. The weighted-average remaining contractual life of the options outstanding and options exercisable was 4.3 years and 2.4 years, respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | 12. Subsequent Events On November 3, 2015, the Board of Directors declared a cash dividend of $0.16 per common share, payable on December 28, 2015. Also on November 3, 2015, the Board of Directors declared a cash dividend of $1.00 per common share, payable on December 28, 2015. In October 2015, a $13.8 million investment in a bridge loan for a renewable energy project was repaid in full. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements and notes have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and do not contain all of the information and footnotes required by U.S. GAAP for complete financial statements. The condensed consolidated financial statements include the results of the Company and its subsidiaries from their respective dates of inception or acquisition, as applicable. Readers are urged to review the Company’s 2014 audited consolidated financial statements for a more complete description of the Company’s business and accounting policies. In the opinion of management, all adjustments necessary for a fair presentation of the condensed consolidated financial statements have been included. Such adjustments consist only of normal recurring items. Interim results are not necessarily indicative of results of operations for the full year. The consolidated balance sheet as of December 31, 2014 was derived from the Company’s audited annual consolidated financial statements. Intercompany transactions and balances have been eliminated. |
Estimates and Assumptions | Estimates and Assumptions Preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying disclosures. Those estimates are inherently subject to change, and actual results may ultimately differ from those estimates. |
Variable Interest Entities | Variable Interest Entities Entities that do not have sufficient equity at risk to allow the entity to finance its activities without additional financial support or in which the equity investors, as a group, do not have the characteristic of a controlling financial interest are referred to as variable interest entities (“VIE”). A VIE is consolidated by the variable interest holder that is determined to have the controlling financial interest (primary beneficiary) as a result of having both (1) the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance and (2) the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. The Company determines whether it is the primary beneficiary of an entity subject to consolidation based on a qualitative assessment of the VIE’s capital structure, contractual terms, nature of the VIE’s operations and purpose, and the Company’s relative exposure to the related risks of the VIE on the date it becomes initially involved in the VIE. The Company reassesses its VIE determination with respect to an entity on an ongoing basis. The Company holds interests in VIEs through certain equity method investments in limited liability companies (“LLCs”) included in “other invested assets” in the accompanying condensed consolidated balance sheets. The Company has determined that it should not consolidate any of the VIEs as it is not the primary beneficiary in any of the relationships. Although the investments resulted in the Company holding variable interests in the entities, they did not empower the Company to direct the activities that most significantly impact the economic performance of the entities. The Company’s investments related to these VIEs totaled $26.0 million and $25.1 million as of September 30, 2015 and December 31, 2014, respectively, representing the Company’s maximum exposure to loss. |
Prospective Accounting Standards | Prospective Accounting Standards In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis In May 2015, the FASB issued ASU 2015-09, Insurance (Topic 944), Disclosures about Short-Duration Contracts |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Investments [Abstract] | |
Schedule of summary of available-for-sale investments | Cost or Gross Gross Fair (in thousands) September 30, 2015 Fixed maturity securities: State and municipal $ 112,053 $ 7,841 $ (41 ) $ 119,853 Residential mortgage-backed 135,851 2,255 (1,394 ) 136,712 Corporate 342,689 5,620 (7,887 ) 340,422 Commercial mortgage and asset-backed 134,420 1,989 (117 ) 136,292 Obligations of U.S. government corporations and agencies 94,872 1,107 (3 ) 95,976 U.S. Treasury securities and obligations guaranteed by the U.S. government 56,814 454 (3 ) 57,265 Redeemable preferred stock 2,025 - (65 ) 1,960 Total fixed maturity securities 878,724 19,266 (9,510 ) 888,480 Equity securities 72,346 3,908 (1,801 ) 74,453 Total investments available-for-sale $ 951,070 $ 23,174 $ (11,311 ) $ 962,933 December 31, 2014 Fixed maturity securities: State and municipal $ 90,715 $ 8,509 $ (178 ) $ 99,046 Residential mortgage-backed 113,997 2,661 (1,409 ) 115,249 Corporate 261,574 8,742 (2,434 ) 267,882 Commercial mortgage and asset-backed 111,056 2,429 (144 ) 113,341 Obligations of U.S. government corporations and agencies 100,376 1,431 (532 ) 101,275 U.S. Treasury securities and obligations guaranteed by the U.S. government 58,173 289 (193 ) 58,269 Redeemable preferred stock 2,025 – (124 ) 1,901 Total fixed maturity securities 737,916 24,061 (5,014 ) 756,963 Equity securities 64,348 5,182 (1,625 ) 67,905 Total investments available-for-sale $ 802,264 $ 29,243 $ (6,639 ) $ 824,868 |
Schedule of summary of available-for-sale investments by contractual maturity | Cost or Fair (in thousands) One year or less $ 84,559 $ 85,179 After one year through five years 267,065 266,232 After five years through ten years 105,309 106,787 After ten years 149,495 155,318 Residential mortgage-backed 135,851 136,712 Commercial mortgage and asset-backed 134,420 136,292 Redeemable preferred stock 2,025 1,960 Total $ 878,724 $ 888,480 |
Schedule of gross unrealized losses and fair value for available-for-sale securities | Less Than 12 Months 12 Months or More Total Fair Gross Fair Gross Fair Gross (in thousands) September 30, 2015 Fixed maturity securities: State and municipal $ 9,587 $ (41 ) – – $ 9,587 $ (41 ) Residential mortgage-backed 23,275 (161 ) 43,109 (1,233 ) 66,384 (1,394 ) Corporate 118,402 (3,363 ) 4,817 (4,524 ) 123,219 (7,887 ) Commercial mortgage and asset-backed 42,098 (58 ) 18,055 (59 ) 60,153 (117 ) Obligation of U.S. government corporations and agencies – – 4,047 (3 ) 4,047 (3 ) U.S. Treasury securities and obligations guaranteed by the U.S. government – – 2,202 (3 ) 2,202 (3 ) Redeemable preferred stock 1,960 (65 ) – – 1,960 (65 ) Total fixed maturity securities 195,322 (3,688 ) 72,230 (5,822 ) 267,552 (9,510 ) Equity securities 9,342 (265 ) 12,071 (1,536 ) 21,413 (1,801 ) Total investments available-for-sale $ 204,664 $ (3,953 ) $ 84,301 $ (7,358 ) $ 288,965 $ (11,311 ) Less Than 12 Months 12 Months or More Total Fair Gross Fair Gross Fair Gross (in thousands) December 31, 2014 Fixed maturity securities: State and municipal $ 3,197 $ (176 ) $ 247 $ (2 ) $ 3,444 $ (178 ) Residential mortgage-backed 2,072 (2 ) 47,594 (1,407 ) 49,666 (1,409 ) Corporate 25,885 (235 ) 22,353 (2,199 ) 48,238 (2,434 ) Commercial mortgage and asset-backed 23,894 (118 ) 8,742 (26 ) 32,636 (144 ) Obligations of U.S. government corporations and agencies 202 – 48,029 (532 ) 48,231 (532 ) U.S. Treasury securities and obligations guaranteed by the U.S. government 13,055 (24 ) 19,383 (169 ) 32,438 (193 ) Redeemable preferred stock – – 1,901 (124 ) 1,901 (124 ) Total fixed maturity securities 68,305 (555 ) 148,249 (4,459 ) 216,554 (5,014 ) Equity securities 1,361 (205 ) 10,621 (1,420 ) 11,982 (1,625 ) Total investments available-for-sale $ 69,666 $ (760 ) $ 158,870 $ (5,879 ) $ 228,536 $ (6,639 ) |
Schedule of summary of realized gains and losses | Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Fixed maturity securities: Gross realized gains $ 130 $ 29 $ 1,417 $ 423 Gross realized losses (72 ) (91 ) (736 ) (1,503 ) 58 (62 ) 681 (1,080 ) Bank loan participations: Gross realized gains 421 736 953 1,714 Gross realized losses (496 ) (3 ) (4,150 ) (981 ) (75 ) 733 (3,197 ) 733 Equity securities: Gross realized gains - - - 88 Gross realized losses - - - (842 ) - - - (754 ) Short-term investments and other: Gross realized gains 4 1,362 52 1,362 Gross realized losses (4 ) - (9 ) (1,939 ) - 1,362 43 (577 ) Total $ (17 ) $ 2,033 $ (2,473 ) $ (1,678 ) |
Schedule of other invested assets | Investment Income Carrying Value Three Months Ended Nine Months Ended September 30, December 31, September 30, September 30, 2015 2014 2015 2014 2015 2014 (in thousands) Category Renewable energy LLCs (a) $ 26,021 $ 25,119 $ (659 ) $ 697 $ 3,956 $ 4,737 Renewable energy bridge financing notes (b) 30,078 - 984 - 2,483 - Limited partnerships (c) 13,702 4,003 (1,038 ) (105 ) (1,112 ) 127 Bank holding companies (d) 4,500 4,500 86 86 257 314 Other (e) - - - 3 - 184 Total other invested assets $ 74,301 $ 33,622 $ (627 ) $ 681 $ 5,584 $ 5,362 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of gross carrying amounts and accumulated amortization | September 30, 2015 December 31, 2014 Life (Years) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization ($ in thousands) Intangible Assets Trademarks Indefinite $ 22,200 $ – $ 22,200 $ – Insurance licenses and authorities Indefinite 9,164 – 9,164 – Identifiable intangibles not subject to amortization 31,364 – 31,364 – Broker relationships 24.6 11,611 3,297 11,611 2,850 Identifiable intangible assets subject to amortization 11,611 3,297 11,611 2,850 $ 42,975 $ 3,297 $ 42,975 $ 2,850 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of numerator and denominator of basic and diluted earnings per share | Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Net income to shareholders $ 18,961 $ 17,168 $ 40,827 $ 35,819 Weighted average common shares outstanding: Basic 28,735,087 28,540,350 28,608,398 28,540,350 Common share equivalents 683,164 253,465 636,122 247,150 Diluted 29,418,251 28,793,815 29,244,520 28,787,500 Earnings per share: Basic $ 0.66 $ 0.60 $ 1.43 $ 1.26 Common share equivalents (0.02 ) - (0.03 ) (.02 ) Diluted $ 0.64 $ 0.60 $ 1.40 $ 1.24 |
Reserve for Losses and Loss A24
Reserve for Losses and Loss Adjustment Expenses (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Loss Contingency [Abstract] | |
Schedule of reconciliation of beginning and ending reserve balances for losses and loss adjustment expenses | Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Reserve for losses and loss adjustment expenses net of reinsurance recoverables at beginning of period $ 627,504 $ 561,939 $ 589,042 $ 526,985 Add: Incurred losses and loss adjustment expenses net of reinsurance: Current year 76,303 69,838 223,725 191,038 Prior years (9,585 ) (15,352 ) (14,592 ) (19,102 ) Total incurred losses and loss and adjustment expenses 66,718 54,486 209,133 171,936 Deduct: Loss and loss adjustment expense payments net of reinsurance: Current year 4,062 7,341 18,665 12,454 Prior years 44,424 37,602 133,774 114,985 Total loss and loss adjustment expense payments 48,486 44,943 152,439 127,439 Reserve for losses and loss adjustment expenses net of reinsurance recoverables at end of period 645,736 571,482 645,736 571,482 Add: Reinsurance recoverables on unpaid losses and loss adjustment expenses at end of period 133,273 119,400 133,273 119,400 Reserve for losses and loss adjustment expenses gross of reinsurance recoverables on unpaid losses and loss adjustment expenses at end of period $ 779,009 $ 690,882 $ 779,009 $ 690,882 |
Other Comprehensive Income (Tab
Other Comprehensive Income (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of components of comprehensive income | Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Unrealized gains (losses) arising during the period, before U.S. income taxes $ 1,516 $ (5,258 ) $ (10,061 ) $ 8,132 U.S. income taxes 104 787 1,434 (2,200 ) Unrealized gains (losses) arising during the period, net of U.S. income taxes 1,620 (4,471 ) (8,627 ) 5,932 Less reclassification adjustment: Net realized investment gains (losses) 58 (62 ) 681 (1,834 ) U.S. income taxes (24 ) 11 162 682 Reclassification adjustment for investment gains (losses) realized in net income 34 (51 ) 843 (1,152 ) Other comprehensive income $ 1,586 $ (4,420 ) $ (9,470 ) $ 7,084 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Schedule of summary of company's segment results | Excess and Surplus Lines Specialty Admitted Insurance Casualty Reinsurance Corporate and Other Total (in thousands) Three Months Ended September 30, 2015 Gross written premiums $ 82,249 $ 22,898 $ 43,089 $ – $ 148,236 Net earned premiums 65,804 10,743 46,158 – 122,705 Underwriting profit of insurance segments 17,047 462 276 – 17,785 Net investment income 3,394 618 5,862 (364 ) 9,510 Interest expense – – – 1,769 1,769 Segment revenues 70,117 11,462 51,871 (327 ) 133,123 Segment goodwill 181,831 – – – 181,831 Segment assets 715,832 154,805 1,115,175 110,303 2,096,115 Three Months Ended September 30, 2014 Gross written premiums $ 61,857 $ 16,211 $ 93,347 $ – $ 171,415 Net earned premiums 51,230 7,185 41,574 – 99,989 Underwriting profit of insurance segments 13,033 162 17 – 13,212 Net investment income 3,472 581 5,269 674 9,996 Interest expense – – – 1,557 1,557 Segment revenues 54,879 7,791 47,123 2,024 111,817 Segment goodwill 181,831 – – – 181,831 Segment assets 696,504 119,367 1,055,793 97,922 1,969,586 Nine Months Ended September 30, 2015 Gross written premiums $ 235,384 $ 61,755 $ 166,366 $ – $ 463,505 Net earned premiums 178,071 30,448 137,257 – 345,776 Underwriting profit of insurance segments 30,259 506 911 – 31,676 Net investment income 10,466 1,720 16,579 5,731 34,496 Interest expense – – – 5,217 5,217 Segment revenues 188,686 32,424 152,868 5,839 379,817 Segment goodwill 181,831 – – – 181,831 Segment assets 715,832 154,805 1,115,175 110,303 2,096,115 Nine Months Ended September 30, 2014 Gross written premiums $ 182,544 $ 40,447 $ 192,625 $ – $ 415,616 Net earned premiums 138,313 18,847 128,897 – 286,057 Underwriting profit (loss) of insurance segments 21,931 (878 ) 424 – 21,477 Net investment income 10,496 1,747 15,441 5,505 33,189 Interest expense – – – 4,661 4,661 Segment revenues 147,205 20,683 145,388 5,032 318,308 Segment goodwill 181,831 – – – 181,831 Segment assets 696,504 119,367 1,055,793 97,922 1,969,586 |
Schedule of underwriting profit (loss) of operating segments by individual segment and reconciliation to consolidated income before taxes | Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Underwriting profit (loss) of the insurance segments: Excess and Surplus Lines $ 17,047 $ 13,033 $ 30,259 $ 21,931 Specialty Admitted Insurance 462 162 506 (878 ) Casualty Reinsurance 276 17 911 424 Total underwriting profit of insurance segments 17,785 13,212 31,676 21,477 Other operating expenses of the Corporate and Other segment (4,324 ) (2,041 ) (12,958 ) (5,762 ) Underwriting profit 13,461 11,171 18,718 15,715 Net investment income 9,510 9,996 34,496 33,189 Net realized investment (losses) gains (17 ) 2,033 (2,473 ) (1,678 ) Amortization of intangible assets (149 ) (149 ) (447 ) (447 ) Other income and expenses (5 ) (2,442 ) (28 ) (2,673 ) Interest expense (1,769 ) (1,557 ) (5,217 ) (4,661 ) Income before taxes $ 21,031 $ 19,052 $ 45,049 $ 39,445 |
Other Operating Expenses and 27
Other Operating Expenses and Other Expenses (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Other Operating Expenses And Other Expenses [Abstract] | |
Schedule of Other operating expenses | Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Amortization of policy acquisition costs $ 28,621 $ 22,258 $ 75,523 $ 63,316 Other underwriting expenses of the operating segments 10,442 9,815 31,283 29,893 Other operating expenses of the Corporate and Other segment 4,324 2,041 12,958 5,762 Total $ 43,387 $ 34,114 $ 119,764 $ 98,971 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets measured at fair value on a recurring basis | Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Level 1 Level 2 Level 3 Total (in thousands) Available-for-sale securities: Fixed maturity securities: State and municipal $ – $ 119,853 $ – $ 119,853 Residential mortgage-backed – 136,712 – 136,712 Corporate – 340,422 - 340,422 Commercial mortgage and asset-backed – 136,292 - 136,292 Obligations of U.S. government corporations and agencies – 95,976 – 95,976 U.S. Treasury securities and obligations guaranteed by the U.S. government 56,534 731 – 57,265 Redeemable preferred stock – 1,960 – 1,960 Total fixed maturity securities 56,534 831,946 - 888,480 Equity securities: Preferred stock – 55,977 – 55,977 Common stock 17,742 734 - 18,476 Total equity securities 17,742 56,711 - 74,453 Total available-for-sale securities $ 74,276 $ 888,657 $ - $ 962,933 Trading securities: Fixed maturity securities $ 1,251 $ – $ – $ 1,251 Short-term investments $ 25,930 $ 24,295 $ – $ 50,225 Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Level 1 Level 2 Level 3 Total (in thousands) Available-for-sale securities: Fixed maturity securities: State and municipal $ – $ 99,046 $ – $ 99,046 Residential mortgage-backed – 115,249 – 115,249 Corporate – 267,882 – 267,882 Commercial mortgage and asset-backed – 113,341 – 113,341 Obligations of U.S. government corporations and agencies – 101,275 – 101,275 U.S. Treasury securities and obligations guaranteed by the U.S. government 56,891 1,378 – 58,269 Redeemable preferred stock – 1,901 – 1,901 Total fixed maturity securities 56,891 700,072 – 756,963 Equity securities: Preferred stock – 49,601 – 49,601 Common stock 17,570 734 – 18,304 Total equity securities 17,570 50,335 – 67,905 Total available-for-sale securities $ 74,461 $ 750,407 $ – $ 824,868 Trading securities: Fixed maturity securities $ – $ 7,388 $ – $ 7,388 Short-term investments $ 58,507 $ 73,349 $ – $ 131,856 |
Schedule of assets measured at fair value on a nonrecurring basis | Fair Value Measurements Using Quoted Prices In Active Markets for Identical Assets Level 1 Significant Other Observable Inputs Level 2 Significant Unobservable Inputs Level 3 Total (in thousands) September 30, 2015 Bank loan participations held-for-investment $ – $ – $ 695 $ 695 |
Schedule of carrying value and fair Value | September 30, 2015 December 31, 2014 Carrying Fair Value Carrying Fair Value (in thousands) Assets Available-for-sale: Fixed maturity securities $ 888,480 $ 888,480 $ 756,963 $ 756,963 Equity securities 74,453 74,453 67,905 67,905 Trading: Fixed maturity securities 1,251 1,251 7,388 7,388 Bank loan participations held-for-investment 213,625 205,340 239,511 231,251 Cash and cash equivalents 76,561 76,561 73,383 73,383 Short-term investments 50,225 50,225 131,856 131,856 Other invested assets – notes receivable 34,578 36,157 4,500 6,410 Liabilities Senior debt 88,300 78,449 88,300 79,850 Junior subordinated debt 104,055 82,345 104,055 89,100 |
Capital Stock and Equity Awar29
Capital Stock and Equity Awards (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Schedule of cash dividends | Date of Declaration Dividend per Common Share Payable to Shareholders of Record on Payment Date Total Amount February 17, 2015 $ 0.16 March 16, 2015 March 31, 2015 $ 4.6 million May 5, 2015 $ 0.16 June 15, 2015 June 30, 2015 $ 4.6 million August 5, 2015 $ 0.16 September 14, 2015 September 30, 2015 $ 4.6 million |
Schedule of summary of option activity | Nine Months Ended September 30, 2015 2014 Shares Weighted- Shares Weighted- Outstanding: Beginning of period 3,104,768 $ 17.27 2,166,250 $ 15.51 Granted 10,627 $ 24.32 - $ - Exercised (804,875 ) $ 15.66 - $ - Lapsed (9,810 ) $ 21.00 (5,000 ) $ 15.65 End of period 2,300,710 $ 17.85 2,161,250 $ 15.51 Exercisable, end of period 999,500 $ 15.34 1,668,250 $ 15.49 |
Schedule of summary of RSU activity | Shares Weighted- Unvested, beginning of period 340,474 $ 21.00 Granted - $ - Unvested, end of period 340,474 $ 21.00 |
Schedule of summary of amount of expense and related tax benefit | Three Months Ended Nine Months Ended 2015 2014 2015 2014 (in thousands) Share based compensation expense $ 940 $ 99 $ 2,794 $ 312 U.S. tax benefit on share based compensation expense 260 21 765 62 |
Accounting Policies (Detail Tex
Accounting Policies (Detail Textuals) $ in Millions | Sep. 30, 2015USD ($)Company | Dec. 31, 2014USD ($) |
Accounting Policies [Abstract] | ||
Number of insurance companies based in the United States | Company | 5 | |
Investment in variable interest entities | $ 26 | $ 25.1 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | $ 951,070 | $ 802,264 |
Gross Unrealized Gains | 23,174 | 29,243 |
Gross Unrealized Losses | (11,311) | (6,639) |
Fair value | 962,933 | 824,868 |
Fixed maturity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | 878,724 | 737,916 |
Gross Unrealized Gains | 19,266 | 24,061 |
Gross Unrealized Losses | (9,510) | (5,014) |
Fair value | 888,480 | 756,963 |
State and municipal | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | 112,053 | 90,715 |
Gross Unrealized Gains | 7,841 | 8,509 |
Gross Unrealized Losses | (41) | (178) |
Fair value | 119,853 | 99,046 |
Residential mortgage-backed | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | 135,851 | 113,997 |
Gross Unrealized Gains | 2,255 | 2,661 |
Gross Unrealized Losses | (1,394) | (1,409) |
Fair value | 136,712 | 115,249 |
Corporate | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | 342,689 | 261,574 |
Gross Unrealized Gains | 5,620 | 8,742 |
Gross Unrealized Losses | (7,887) | (2,434) |
Fair value | 340,422 | 267,882 |
Commercial mortgage and asset-backed | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | 134,420 | 111,056 |
Gross Unrealized Gains | 1,989 | 2,429 |
Gross Unrealized Losses | (117) | (144) |
Fair value | 136,292 | 113,341 |
Obligations of U.S. government corporations and agencies | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | 94,872 | 100,376 |
Gross Unrealized Gains | 1,107 | 1,431 |
Gross Unrealized Losses | (3) | (532) |
Fair value | 95,976 | 101,275 |
U.S. Treasury securities and obligations guaranteed by the U.S. government | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | 56,814 | 58,173 |
Gross Unrealized Gains | 454 | 289 |
Gross Unrealized Losses | (3) | (193) |
Fair value | 57,265 | 58,269 |
Redeemable preferred stock | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | $ 2,025 | $ 2,025 |
Gross Unrealized Gains | ||
Gross Unrealized Losses | $ (65) | $ (124) |
Fair value | 1,960 | 1,901 |
Equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost or Amortized Cost | 72,346 | 64,348 |
Gross Unrealized Gains | 3,908 | 5,182 |
Gross Unrealized Losses | (1,801) | (1,625) |
Fair value | $ 74,453 | $ 67,905 |
Investments (Details 1)
Investments (Details 1) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Cost or Amortized Cost | ||
One year or less | $ 84,559 | |
After one year through five years | 267,065 | |
After five years through ten years | 105,309 | |
After ten years | 149,495 | |
Residential mortgage-backed | 135,851 | |
Commercial mortgage and asset-backed | 134,420 | |
Redeemable preferred stock | 2,025 | |
Total, Cost or Amortized Cost | 878,724 | $ 737,916 |
Fair Value | ||
One year or less | 85,179 | |
After one year through five years | 266,232 | |
After five years through ten years | 106,787 | |
After ten years | 155,318 | |
Residential mortgage-backed | 136,712 | |
Commercial mortgage and asset-backed | 136,292 | |
Redeemable preferred stock | 1,960 | |
Total, Fair Value | $ 888,480 | $ 756,963 |
Investments (Details 2)
Investments (Details 2) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | $ 204,664 | $ 69,666 |
Less Than 12 Months Gross Unrealized Losses | (3,953) | (760) |
12 Months or More Fair Value | 84,301 | 158,870 |
12 Months or More Gross Unrealized Losses | (7,358) | (5,879) |
Total Fair Value | 288,965 | 228,536 |
Total Gross Unrealized Losses | (11,311) | (6,639) |
Fixed maturity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | 195,322 | 68,305 |
Less Than 12 Months Gross Unrealized Losses | (3,688) | (555) |
12 Months or More Fair Value | 72,230 | 148,249 |
12 Months or More Gross Unrealized Losses | (5,822) | (4,459) |
Total Fair Value | 267,552 | 216,554 |
Total Gross Unrealized Losses | (9,510) | (5,014) |
State and municipal | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | 9,587 | 3,197 |
Less Than 12 Months Gross Unrealized Losses | $ (41) | (176) |
12 Months or More Fair Value | 247 | |
12 Months or More Gross Unrealized Losses | (2) | |
Total Fair Value | $ 9,587 | 3,444 |
Total Gross Unrealized Losses | (41) | (178) |
Residential mortgage-backed | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | 23,275 | 2,072 |
Less Than 12 Months Gross Unrealized Losses | (161) | (2) |
12 Months or More Fair Value | 43,109 | 47,594 |
12 Months or More Gross Unrealized Losses | (1,233) | (1,407) |
Total Fair Value | 66,384 | 49,666 |
Total Gross Unrealized Losses | (1,394) | (1,409) |
Corporate | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | 118,402 | 25,885 |
Less Than 12 Months Gross Unrealized Losses | (3,363) | (235) |
12 Months or More Fair Value | 4,817 | 22,353 |
12 Months or More Gross Unrealized Losses | (4,524) | (2,199) |
Total Fair Value | 123,219 | 48,238 |
Total Gross Unrealized Losses | (7,887) | (2,434) |
Commercial mortgage and asset-backed | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | 42,098 | 23,894 |
Less Than 12 Months Gross Unrealized Losses | (58) | (118) |
12 Months or More Fair Value | 18,055 | 8,742 |
12 Months or More Gross Unrealized Losses | (59) | (26) |
Total Fair Value | 60,153 | 32,636 |
Total Gross Unrealized Losses | $ (117) | (144) |
Obligations of U.S. government corporations and agencies | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | $ 202 | |
Less Than 12 Months Gross Unrealized Losses | ||
12 Months or More Fair Value | $ 4,047 | $ 48,029 |
12 Months or More Gross Unrealized Losses | (3) | (532) |
Total Fair Value | 4,047 | 48,231 |
Total Gross Unrealized Losses | $ (3) | (532) |
U.S. Treasury securities and obligations guaranteed by the U.S. government | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | 13,055 | |
Less Than 12 Months Gross Unrealized Losses | (24) | |
12 Months or More Fair Value | $ 2,202 | 19,383 |
12 Months or More Gross Unrealized Losses | (3) | (169) |
Total Fair Value | 2,202 | 32,438 |
Total Gross Unrealized Losses | (3) | $ (193) |
Redeemable preferred stock | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | 1,960 | |
Less Than 12 Months Gross Unrealized Losses | $ (65) | |
12 Months or More Fair Value | $ 1,901 | |
12 Months or More Gross Unrealized Losses | (124) | |
Total Fair Value | $ 1,960 | 1,901 |
Total Gross Unrealized Losses | (65) | (124) |
Equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | 9,342 | 1,361 |
Less Than 12 Months Gross Unrealized Losses | (265) | (205) |
12 Months or More Fair Value | 12,071 | 10,621 |
12 Months or More Gross Unrealized Losses | (1,536) | (1,420) |
Total Fair Value | 21,413 | 11,982 |
Total Gross Unrealized Losses | $ (1,801) | $ (1,625) |
Investments (Details 3)
Investments (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Schedule of Available-for-sale Securities [Line Items] | ||||
Total | $ (17) | $ 2,033 | $ (2,473) | $ (1,678) |
Fixed maturity securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Gross realized gains | 130 | 29 | 1,417 | 423 |
Gross realized losses | (72) | (91) | (736) | (1,503) |
Total | 58 | (62) | 681 | (1,080) |
Bank loan participations: | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Gross realized gains | 421 | 736 | 953 | 1,714 |
Gross realized losses | (496) | (3) | (4,150) | (981) |
Total | $ (75) | $ 733 | $ (3,197) | 733 |
Equity securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Gross realized gains | 88 | |||
Gross realized losses | (842) | |||
Total | (754) | |||
Short-term investments and other | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Gross realized gains | $ 4 | $ 1,362 | $ 52 | 1,362 |
Gross realized losses | $ (4) | (9) | (1,939) | |
Total | $ 1,362 | $ 43 | $ (577) |
Investments (Details 4)
Investments (Details 4) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Net Investment Income [Line Items] | |||||
Total other invested assets | $ 74,301 | $ 74,301 | $ 33,622 | ||
Investment Income | (627) | $ 681 | 5,584 | $ 5,362 | |
Renewable energy LLCs | |||||
Net Investment Income [Line Items] | |||||
Total other invested assets | 26,021 | 26,021 | $ 25,119 | ||
Investment Income | (659) | $ 697 | 3,956 | $ 4,737 | |
Renewable energy bridge financing notes | |||||
Net Investment Income [Line Items] | |||||
Total other invested assets | 30,078 | 30,078 | |||
Investment Income | 984 | 2,483 | |||
Limited partnerships | |||||
Net Investment Income [Line Items] | |||||
Total other invested assets | 13,702 | 13,702 | $ 4,003 | ||
Investment Income | (1,038) | $ (105) | (1,112) | $ 127 | |
Bank holding companies | |||||
Net Investment Income [Line Items] | |||||
Total other invested assets | 4,500 | 4,500 | $ 4,500 | ||
Investment Income | $ 86 | 86 | $ 257 | 314 | |
Other | |||||
Net Investment Income [Line Items] | |||||
Total other invested assets | |||||
Investment Income | $ 3 | $ 184 |
Investments (Detail Textuals)
Investments (Detail Textuals) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2015USD ($)Issuers | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)IssuersLoans | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($)Bond | |
Gain (Loss) on Investments [Line Items] | |||||||
Number of available-for-sale securities held in an unrealized loss position | Issuers | 88 | 88 | |||||
Total fair value of unrealized loss position securities | $ 288,965 | $ 288,965 | $ 228,536 | ||||
Total gross unrealized losses of unrealized loss position securities | 11,311 | 6,639 | |||||
Fair value | 962,933 | 962,933 | 824,868 | ||||
Gross unrealized losses | (11,311) | (11,311) | (6,639) | ||||
Carrying value of loan | 213,625 | 213,625 | 239,511 | ||||
Average recorded investment in impaired bank loans | 6,300 | $ 4,100 | |||||
Investment income during period loans were impaired | 139 | 59 | |||||
Net investment income | 21 | 4 | |||||
Net unrealized losses | 1 | 1 | |||||
Realized gain loss on changes in fair value of impaired bank loans | 143 | $ 221 | 346 | 742 | |||
Fixed maturity securities | |||||||
Gain (Loss) on Investments [Line Items] | |||||||
Total fair value of unrealized loss position securities | 267,552 | 267,552 | 216,554 | ||||
Total gross unrealized losses of unrealized loss position securities | 9,510 | 5,014 | |||||
Fair value | 888,480 | 888,480 | 756,963 | ||||
Gross unrealized losses | (9,510) | (9,510) | (5,014) | ||||
Realized gains | 130 | 29 | 1,417 | 423 | |||
Realized losses | 72 | $ 91 | $ 736 | 1,503 | |||
Puerto rico loan | |||||||
Gain (Loss) on Investments [Line Items] | |||||||
Number of impaired loans held | Loans | 2 | ||||||
Allowance for credit losses | $ 501 | $ 742 | 752 | ||||
Carrying value of impaired loans | 4,700 | 4,700 | 7,100 | ||||
Unpaid principal on impaired loans | 5,600 | 5,600 | $ 8,400 | ||||
Oil and gas companies loan | |||||||
Gain (Loss) on Investments [Line Items] | |||||||
Bank loan participations gross unrealized losses | 5,000 | ||||||
Carrying value of loan | 21,000 | $ 21,000 | |||||
Impaired bank loans | |||||||
Gain (Loss) on Investments [Line Items] | |||||||
Number of impaired loans held | Loans | 1 | ||||||
Allowance for credit losses | $ 29 | ||||||
Carrying value of impaired loans | 695 | 695 | |||||
Unpaid principal on impaired loans | $ 724 | $ 724 | |||||
A- or better | Fixed maturity securities | |||||||
Gain (Loss) on Investments [Line Items] | |||||||
Percentage of available for sale securities | 87.10% | 87.10% | |||||
Ratings below investment grade | Fixed maturity securities | |||||||
Gain (Loss) on Investments [Line Items] | |||||||
Fair value | $ 10,300 | $ 10,300 | |||||
Net unrealized losses | $ 4,700 | ||||||
Ratings below investment grade | Impaired Puerto Rico Municipal Bonds | |||||||
Gain (Loss) on Investments [Line Items] | |||||||
Number of impaired Puerto Rico municipal bonds held | Bond | 2 | ||||||
Net realized gain on sale | $ 22 | ||||||
Impairment losses on Puerto Rico municipal bonds | $ 660 | $ 1,400 |
Investments (Detail Textuals 1)
Investments (Detail Textuals 1) $ in Thousands | Jul. 04, 2014USD ($) | Mar. 31, 2015USD ($) | Dec. 19, 2014USD ($) | Mar. 31, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Sep. 30, 2015USD ($)Director | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) |
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Investments in fixed maturities | $ 888,480 | $ 888,480 | $ 756,963 | |||||||
Realized investment gains and losses | (17) | $ 2,033 | (2,473) | $ (1,678) | ||||||
Renewable energy bridge financing notes | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Investment amount | 36,300 | |||||||||
Proceeds from partial maturities | 7,000 | |||||||||
Limited partnerships | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Commitment to investment in limited partnership | 9,200 | 9,200 | ||||||||
First Wind | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Carrying value of investments | 4,600 | |||||||||
Surviving Bank Holding Company | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Interest income | 1 | $ 4 | ||||||||
Purchase of certificate of deposit | $ 1,000 | |||||||||
Minimum | Corporate and other segment | Renewable energy bridge financing notes | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Rate of interest | 7.30% | |||||||||
Maximum | Corporate and other segment | Renewable energy bridge financing notes | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Rate of interest | 15.00% | |||||||||
Fixed maturity securities | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Realized gains | 130 | 29 | $ 1,417 | 423 | ||||||
Realized investment gains and losses | $ 58 | $ (62) | $ 681 | (1,080) | ||||||
Fixed maturity securities | First Wind | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Number of directors | Director | 2 | |||||||||
Investments in fixed maturities | $ 12,600 | |||||||||
Realized gains | $ 845 | |||||||||
Bank Holding Company | Surviving Bank Holding Company | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Cash received in exchange | $ 354 | |||||||||
Value of common shares received in exchange | 6,400 | |||||||||
Realized investment gains and losses | $ 1,400 | |||||||||
Bank Holding Company | Corporate and other segment | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Investment income | 57 | |||||||||
Investment in subordinated notes | $ 4,500 | |||||||||
Rate of interest | 7.60% | |||||||||
Investment in LLC | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Proceeds from sale of investment | $ 5,900 | |||||||||
Realized loss recognized on sale of investment | $ 1,900 | |||||||||
Investment in LLC | Corporate and other segment | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Investment income | $ 3,600 | |||||||||
Cash distributions from LLCs | $ 3,100 | $ 3,300 | ||||||||
Investment in LLC | Minimum | Corporate and other segment | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Ownership percentage | 2.70% | 2.70% | ||||||||
Investment in LLC | Maximum | Corporate and other segment | ||||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||||
Ownership percentage | 33.30% | 33.30% |
Investments (Detail Textuals 2)
Investments (Detail Textuals 2) - Property development companies - Corporate and other segment | Jul. 03, 2014USD ($)Company | Sep. 30, 2014USD ($) | Sep. 30, 2014USD ($) |
Schedule of Available-for-sale Securities [Line Items] | |||
Interest income | $ 3,000 | $ 184,000 | |
Number of property development companies | Company | 2 | ||
Investments in note agreements | $ 3,300,000 | ||
Investment interest rate | 11.10% |
Goodwill and Intangible Asset39
Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Acquired Intangible Assets [Line Items] | ||
Identifiable intangibles not subject to amortization | $ 31,364 | $ 31,364 |
Identifiable intangible assets subject to amortization | ||
Gross Carrying Amount | 11,611 | 11,611 |
Accumulated Amortization | 3,297 | 2,850 |
Total Intangible Assets, Gross | 42,975 | 42,975 |
Broker relationships | ||
Identifiable intangible assets subject to amortization | ||
Gross Carrying Amount | 11,611 | 11,611 |
Accumulated Amortization | $ 3,297 | 2,850 |
Life (Years) | 24 years 7 months 6 days | |
Trademarks | ||
Acquired Intangible Assets [Line Items] | ||
Identifiable intangibles not subject to amortization | $ 22,200 | 22,200 |
Insurance licenses and authorities | ||
Acquired Intangible Assets [Line Items] | ||
Identifiable intangibles not subject to amortization | $ 9,164 | $ 9,164 |
Goodwill and Intangible Asset40
Goodwill and Intangible Assets (Detail Textuals) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Dec. 11, 2007 |
Business Acquisition [Line Items] | |||
Goodwill | $ 181,831 | $ 181,831 | |
James River Group, Inc. | |||
Business Acquisition [Line Items] | |||
Percentage of outstanding shares | 100.00% |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Earnings Per Share [Abstract] | ||||
Net income to shareholders | $ 18,961 | $ 17,168 | $ 40,827 | $ 35,819 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 28,735,087 | 28,540,350 | 28,608,398 | 28,540,350 |
Common share equivalents (in shares) | 683,164 | 253,465 | 636,122 | 247,150 |
Diluted (in shares) | 29,418,251 | 28,793,815 | 29,244,520 | 28,787,500 |
Earnings per share: | ||||
Basic (in dollars per share) | $ 0.66 | $ 0.60 | $ 1.43 | $ 1.26 |
Common share equivalents (in dollars per share) | (0.02) | (0.03) | (0.02) | |
Diluted (in dollars per share) | $ 0.64 | $ 0.60 | $ 1.40 | $ 1.24 |
Earnings Per Share (Detail Text
Earnings Per Share (Detail Textuals) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Stock options and restricted share units ("RSU's") | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of securities excluded from the calculations of diluted earnings per share | 10,627 | 25,000 | 5,761 | 25,000 |
Reserve for Losses and Loss A43
Reserve for Losses and Loss Adjustment Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Loss Contingency [Abstract] | |||||
Reserve for losses and loss adjustment expenses net of reinsurance recoverables at beginning of period | $ 627,504 | $ 561,939 | $ 589,042 | $ 526,985 | |
Add: Incurred losses and loss adjustment expenses net of reinsurance: | |||||
Current year | 76,303 | 69,838 | 223,725 | 191,038 | |
Prior years | (9,585) | (15,352) | (14,592) | (19,102) | |
Total incurred losses and loss and adjustment expenses | 66,718 | 54,486 | 209,133 | 171,936 | |
Deduct: Loss and loss adjustment expense payments net of reinsurance: | |||||
Current year | 4,062 | 7,341 | 18,665 | 12,454 | |
Prior years | 44,424 | 37,602 | 133,774 | 114,985 | |
Total loss and loss adjustment expense payments | 48,486 | 44,943 | 152,439 | 127,439 | |
Reserve for losses and loss adjustment expenses net of reinsurance recoverables at end of period | 645,736 | 571,482 | 645,736 | 571,482 | |
Add: Reinsurance recoverables on unpaid losses and loss adjustment expenses at end of period | 133,273 | 119,400 | 133,273 | 119,400 | $ 127,254 |
Reserve for losses and loss adjustment expenses gross of reinsurance recoverables on unpaid losses and loss adjustment expenses at end of period | $ 779,009 | $ 690,882 | $ 779,009 | $ 690,882 |
Reserve for Losses and Loss A44
Reserve for Losses and Loss Adjustment Expenses (Detail Textuals) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Favorable development on prior year loss reserves | ||||
Reserve for losses and loss adjustment expenses | $ 9,585 | $ 15,352 | $ 14,592 | $ 19,102 |
Excess and Surplus Lines | ||||
Favorable development on prior year loss reserves | ||||
Reserve for losses and loss adjustment expenses | 10,100 | 12,000 | 18,500 | 18,300 |
Specialty Admitted Insurance | ||||
Favorable development on prior year loss reserves | ||||
Reserve for losses and loss adjustment expenses | 2,000 | 2,200 | 2,200 | 3,300 |
Casualty Reinsurance | ||||
Favorable development on prior year loss reserves | ||||
Reserve for losses and loss adjustment expenses | $ (2,500) | $ 1,200 | $ (6,000) | $ (2,400) |
Other Comprehensive Income (Det
Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Unrealized gains (losses) arising during the period, before U.S. income taxes | $ 1,516 | $ (5,258) | $ (10,061) | $ 8,132 |
U.S. income taxes | 104 | 787 | 1,434 | (2,200) |
Unrealized gains (losses) arising during the period, net of U.S. income taxes | 1,620 | (4,471) | (8,627) | 5,932 |
Less reclassification adjustment: | ||||
Net realized investment gains (losses) | 58 | (62) | 681 | (1,834) |
U.S. income taxes | (24) | 11 | 162 | 682 |
Reclassification adjustment for investment gains (losses) realized in net income | 34 | (51) | 843 | (1,152) |
Other comprehensive income | $ 1,586 | $ (4,420) | $ (9,470) | $ 7,084 |
Commitments and Contingent Li46
Commitments and Contingent Liabilities (Detail Textuals) - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | May. 31, 2015 | |
Loans of middle market private equity sponsored companies | ||
Contingent Liabilities [Line Items] | ||
Commitment to investment in limited partnership | $ 5,000,000 | |
Funding for investment in limited partnership | 625,000 | |
Remaining commitment | 4,400,000 | |
Collateralized loan obligations (CLO)s | ||
Contingent Liabilities [Line Items] | ||
Commitment to investment in limited partnership | $ 15,000,000 | |
Funding for investment in limited partnership | 10,200,000 | |
Remaining commitment | $ 4,800,000 | |
JRG Reinsurance Company, Ltd. | ||
Contingent Liabilities [Line Items] | ||
Number of letter of credit facilities | 2 | |
Total amount deposited in trust accounts | $ 216,700,000 | |
JRG Reinsurance Company, Ltd. | Letter of credit 100 Million | ||
Contingent Liabilities [Line Items] | ||
Letters of credit facility, amount | 100,000,000 | |
Amount of letters of credit issued | 95,200,000 | |
Assets deposited for securing letters of credit | 113,400,000 | |
JRG Reinsurance Company, Ltd. | Letter of credit 102.5 Million | ||
Contingent Liabilities [Line Items] | ||
Letters of credit facility, amount | 102,500,000 | |
Amount of letters of credit issued | 43,500,000 | |
Assets deposited for securing letters of credit | $ 61,800,000 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Segment Reporting Information [Line Items] | |||||
Gross written premiums | $ 148,236 | $ 171,415 | $ 463,505 | $ 415,616 | |
Net earned premiums | 122,705 | 99,989 | 345,776 | 286,057 | |
Net investment income | 9,510 | 9,996 | 34,496 | 33,189 | |
Interest expense | 1,769 | 1,557 | 5,217 | 4,661 | |
Segment revenues | 133,123 | $ 111,817 | 379,817 | $ 318,308 | |
Segment goodwill | 181,831 | 181,831 | $ 181,831 | ||
Segment assets | $ 2,096,115 | $ 2,096,115 | $ 1,959,292 | ||
Corporate and Other | |||||
Segment Reporting Information [Line Items] | |||||
Gross written premiums | |||||
Net earned premiums | |||||
Underwriting profit of insurance segments | |||||
Net investment income | $ (364) | $ 674 | $ 5,731 | $ 5,505 | |
Interest expense | 1,769 | 1,557 | 5,217 | 4,661 | |
Segment revenues | $ (327) | $ 2,024 | $ 5,839 | $ 5,032 | |
Segment goodwill | |||||
Segment assets | $ 110,303 | $ 97,922 | $ 110,303 | $ 97,922 | |
Reportable segments | |||||
Segment Reporting Information [Line Items] | |||||
Gross written premiums | 148,236 | 171,415 | 463,505 | 415,616 | |
Net earned premiums | 122,705 | 99,989 | 345,776 | 286,057 | |
Underwriting profit of insurance segments | 17,785 | 13,212 | 31,676 | 21,477 | |
Net investment income | 9,510 | 9,996 | 34,496 | 33,189 | |
Interest expense | 1,769 | 1,557 | 5,217 | 4,661 | |
Segment revenues | 133,123 | 111,817 | 379,817 | 318,308 | |
Segment goodwill | 181,831 | 181,831 | 181,831 | 181,831 | |
Segment assets | 2,096,115 | 1,969,586 | 2,096,115 | 1,969,586 | |
Reportable segments | Excess and Surplus Lines | |||||
Segment Reporting Information [Line Items] | |||||
Gross written premiums | 82,249 | 61,857 | 235,384 | 182,544 | |
Net earned premiums | 65,804 | 51,230 | 178,071 | 138,313 | |
Underwriting profit of insurance segments | 17,047 | 13,033 | 30,259 | 21,931 | |
Net investment income | $ 3,394 | $ 3,472 | $ 10,466 | $ 10,496 | |
Interest expense | |||||
Segment revenues | $ 70,117 | $ 54,879 | $ 188,686 | $ 147,205 | |
Segment goodwill | 181,831 | 181,831 | 181,831 | 181,831 | |
Segment assets | 715,832 | 696,504 | 715,832 | 696,504 | |
Reportable segments | Specialty Admitted Insurance | |||||
Segment Reporting Information [Line Items] | |||||
Gross written premiums | 22,898 | 16,211 | 61,755 | 40,447 | |
Net earned premiums | 10,743 | 7,185 | 30,448 | 18,847 | |
Underwriting profit of insurance segments | 462 | 162 | 506 | (878) | |
Net investment income | $ 618 | $ 581 | $ 1,720 | $ 1,747 | |
Interest expense | |||||
Segment revenues | $ 11,462 | $ 7,791 | $ 32,424 | $ 20,683 | |
Segment goodwill | |||||
Segment assets | $ 154,805 | $ 119,367 | $ 154,805 | $ 119,367 | |
Reportable segments | Casualty Reinsurance | |||||
Segment Reporting Information [Line Items] | |||||
Gross written premiums | 43,089 | 93,347 | 166,366 | 192,625 | |
Net earned premiums | 46,158 | 41,574 | 137,257 | 128,897 | |
Underwriting profit of insurance segments | 276 | 17 | 911 | 424 | |
Net investment income | $ 5,862 | $ 5,269 | $ 16,579 | $ 15,441 | |
Interest expense | |||||
Segment revenues | $ 51,871 | $ 47,123 | $ 152,868 | $ 145,388 | |
Segment goodwill | |||||
Segment assets | $ 1,115,175 | $ 1,055,793 | $ 1,115,175 | $ 1,055,793 |
Segment Information (Details 1)
Segment Information (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Segment Reporting Information [Line Items] | ||||
Other operating expenses | $ (4,324) | $ (2,041) | $ (12,958) | $ (5,762) |
Net investment income | 9,510 | 9,996 | 34,496 | 33,189 |
Net realized investment (losses) gains | (17) | 2,033 | (2,473) | (1,678) |
Amortization of intangible assets | (149) | (149) | (447) | (447) |
Interest expense | $ (1,769) | $ (1,557) | $ (5,217) | $ (4,661) |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Underwriting profit of insurance segments | ||||
Other operating expenses | $ (4,324) | $ (2,041) | $ (12,958) | $ (5,762) |
Net investment income | (364) | 674 | 5,731 | 5,505 |
Interest expense | (1,769) | (1,557) | (5,217) | (4,661) |
Reportable segments | ||||
Segment Reporting Information [Line Items] | ||||
Underwriting profit of insurance segments | 17,785 | 13,212 | 31,676 | 21,477 |
Underwriting profit | 13,461 | 11,171 | 18,718 | 15,715 |
Net investment income | 9,510 | 9,996 | 34,496 | 33,189 |
Net realized investment (losses) gains | (17) | 2,033 | (2,473) | (1,678) |
Amortization of intangible assets | (149) | (149) | (447) | (447) |
Other income and expenses | (5) | (2,442) | (28) | (2,673) |
Interest expense | (1,769) | (1,557) | (5,217) | (4,661) |
Income before taxes | 21,031 | 19,052 | 45,049 | 39,445 |
Reportable segments | Excess and Surplus Lines | ||||
Segment Reporting Information [Line Items] | ||||
Underwriting profit of insurance segments | 17,047 | 13,033 | 30,259 | 21,931 |
Net investment income | $ 3,394 | $ 3,472 | $ 10,466 | $ 10,496 |
Interest expense | ||||
Reportable segments | Specialty Admitted Insurance | ||||
Segment Reporting Information [Line Items] | ||||
Underwriting profit of insurance segments | $ 462 | $ 162 | $ 506 | $ (878) |
Net investment income | $ 618 | $ 581 | $ 1,720 | $ 1,747 |
Interest expense | ||||
Reportable segments | Casualty Reinsurance | ||||
Segment Reporting Information [Line Items] | ||||
Underwriting profit of insurance segments | $ 276 | $ 17 | $ 911 | $ 424 |
Net investment income | $ 5,862 | $ 5,269 | $ 16,579 | $ 15,441 |
Interest expense |
Segment Information (Detail Tex
Segment Information (Detail Textuals) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Segment | Sep. 30, 2014USD ($) | |
Segment Reporting [Abstract] | ||||
Number of reportable segments | 4 | |||
Fee income and expenses in Excess and Surplus Lines segment | $ | $ 861,000 | $ (218,000) | $ 1,800,000 | $ 565,000 |
Other Operating Expenses and 50
Other Operating Expenses and Other Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Other Operating Expenses And Other Expenses [Abstract] | ||||
Amortization of policy acquisition costs | $ 28,621 | $ 22,258 | $ 75,523 | $ 63,316 |
Other underwriting expenses of the operating segments | 10,442 | 9,815 | 31,283 | 29,893 |
Other operating expenses of the Corporate and Other segment | 4,324 | 2,041 | 12,958 | 5,762 |
Total | $ 43,387 | $ 34,114 | $ 119,764 | $ 98,971 |
Other Operating Expenses and 51
Other Operating Expenses and Other Expenses (Detail Textuals) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Other Operating Expenses And Other Expenses [Abstract] | ||||
Other expenses | $ 69,000 | $ 2,459,000 | $ 207,000 | $ 2,848,000 |
Expenses associated with deemed ownership of a building | 72,000 | 210,000 | ||
Legal services cost related to offering | 1,800,000 | 1,900,000 | ||
Employee severance cost | $ 600,000 | 600,000 | ||
Other expenses due diligence costs | $ 183,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | $ 962,933 | $ 824,868 |
Trading: | ||
Fixed maturity securities | 1,251 | 7,388 |
Short-term investments | 50,225 | 131,856 |
Fixed maturity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 888,480 | 756,963 |
State and municipal | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 119,853 | 99,046 |
Residential mortgage-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 136,712 | 115,249 |
Corporate | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 340,422 | 267,882 |
Commercial mortgage and asset-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 136,292 | 113,341 |
Obligations of U.S. government corporations and agencies | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 95,976 | 101,275 |
U.S. Treasury securities and obligations guaranteed by the U.S. government | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 57,265 | 58,269 |
Redeemable preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 1,960 | 1,901 |
Equity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 74,453 | 67,905 |
Recurring basis | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 962,933 | 824,868 |
Trading: | ||
Fixed maturity securities | 1,251 | 7,388 |
Short-term investments | 50,225 | 131,856 |
Recurring basis | Fixed maturity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 888,480 | 756,963 |
Recurring basis | State and municipal | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 119,853 | 99,046 |
Recurring basis | Residential mortgage-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 136,712 | 115,249 |
Recurring basis | Corporate | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 340,422 | 267,882 |
Recurring basis | Commercial mortgage and asset-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 136,292 | 113,341 |
Recurring basis | Obligations of U.S. government corporations and agencies | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 95,976 | 101,275 |
Recurring basis | U.S. Treasury securities and obligations guaranteed by the U.S. government | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 57,265 | 58,269 |
Recurring basis | Redeemable preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 1,960 | 1,901 |
Recurring basis | Equity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 74,453 | 67,905 |
Recurring basis | Preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 55,977 | 49,601 |
Recurring basis | Common stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 18,476 | 18,304 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 74,276 | $ 74,461 |
Trading: | ||
Fixed maturity securities | 1,251 | |
Short-term investments | 25,930 | $ 58,507 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | Fixed maturity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | $ 56,534 | $ 56,891 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | State and municipal | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | Residential mortgage-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | Corporate | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | Commercial mortgage and asset-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | Obligations of U.S. government corporations and agencies | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | U.S. Treasury securities and obligations guaranteed by the U.S. government | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | $ 56,534 | $ 56,891 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | Redeemable preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | Equity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | $ 17,742 | $ 17,570 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | Preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Quoted Prices in Active Markets for Identical Assets Level 1 | Common stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | $ 17,742 | $ 17,570 |
Recurring basis | Significant Other Observable Inputs Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | $ 888,657 | 750,407 |
Trading: | ||
Fixed maturity securities | 7,388 | |
Short-term investments | $ 24,295 | 73,349 |
Recurring basis | Significant Other Observable Inputs Level 2 | Fixed maturity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 831,946 | 700,072 |
Recurring basis | Significant Other Observable Inputs Level 2 | State and municipal | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 119,853 | 99,046 |
Recurring basis | Significant Other Observable Inputs Level 2 | Residential mortgage-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 136,712 | 115,249 |
Recurring basis | Significant Other Observable Inputs Level 2 | Corporate | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 340,422 | 267,882 |
Recurring basis | Significant Other Observable Inputs Level 2 | Commercial mortgage and asset-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 136,292 | 113,341 |
Recurring basis | Significant Other Observable Inputs Level 2 | Obligations of U.S. government corporations and agencies | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 95,976 | 101,275 |
Recurring basis | Significant Other Observable Inputs Level 2 | U.S. Treasury securities and obligations guaranteed by the U.S. government | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 731 | 1,378 |
Recurring basis | Significant Other Observable Inputs Level 2 | Redeemable preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 1,960 | 1,901 |
Recurring basis | Significant Other Observable Inputs Level 2 | Equity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 56,711 | 50,335 |
Recurring basis | Significant Other Observable Inputs Level 2 | Preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | 55,977 | 49,601 |
Recurring basis | Significant Other Observable Inputs Level 2 | Common stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | $ 734 | $ 734 |
Recurring basis | Significant Unobservable Inputs Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Trading: | ||
Fixed maturity securities | ||
Short-term investments | ||
Recurring basis | Significant Unobservable Inputs Level 3 | Fixed maturity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | State and municipal | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | Residential mortgage-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | Corporate | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | Commercial mortgage and asset-backed | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | Obligations of U.S. government corporations and agencies | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | U.S. Treasury securities and obligations guaranteed by the U.S. government | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | Redeemable preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | Equity securities | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | Preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities | ||
Recurring basis | Significant Unobservable Inputs Level 3 | Common stock | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Total available-for-sale securities |
Fair Value Measurements (Deta53
Fair Value Measurements (Details 1) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Bank loan participations held for investment | $ 695 | $ 7,900 |
Nonrecurring basis | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Bank loan participations held for investment | $ 695 | |
Quoted Prices in Active Markets for Identical Assets Level 1 | Nonrecurring basis | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Bank loan participations held for investment | ||
Significant Other Observable Inputs Level 2 | Nonrecurring basis | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Bank loan participations held for investment | ||
Significant Unobservable Inputs Level 3 | Nonrecurring basis | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Bank loan participations held for investment | $ 695 |
Fair Value Measurements (Deta54
Fair Value Measurements (Details 2) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Dec. 31, 2013 |
Available-for-sale: | ||||
Fixed maturity securities | $ 888,480 | $ 756,963 | ||
Equity securities | 74,453 | 67,905 | ||
Trading: | ||||
Bank loan participations held-for-investment | 213,625 | 239,511 | ||
Cash and cash equivalents | 76,561 | 73,383 | $ 91,633 | $ 158,604 |
Short-term investments | 50,225 | 131,856 | ||
Carrying Value | ||||
Available-for-sale: | ||||
Fixed maturity securities | 888,480 | 756,963 | ||
Equity securities | 74,453 | 67,905 | ||
Trading: | ||||
Fixed maturity securities | 1,251 | 7,388 | ||
Bank loan participations held-for-investment | 213,625 | 239,511 | ||
Cash and cash equivalents | 76,561 | 73,383 | ||
Short-term investments | 50,225 | 131,856 | ||
Other invested assets - notes receivable | 34,578 | 4,500 | ||
Liabilities | ||||
Senior debt | 88,300 | 88,300 | ||
Junior subordinated debt | 104,055 | 104,055 | ||
Fair Value | ||||
Available-for-sale: | ||||
Fixed maturity securities | 888,480 | 756,963 | ||
Equity securities | 74,453 | 67,905 | ||
Trading: | ||||
Fixed maturity securities | 1,251 | 7,388 | ||
Bank loan participations held-for-investment | 205,340 | 231,251 | ||
Cash and cash equivalents | 76,561 | 73,383 | ||
Short-term investments | 50,225 | 131,856 | ||
Other invested assets - notes receivable | 36,157 | 6,410 | ||
Liabilities | ||||
Senior debt | 78,449 | 79,850 | ||
Junior subordinated debt | $ 82,345 | $ 89,100 |
Fair Value Measurements (Deta55
Fair Value Measurements (Detail Textuals) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
Fair Value Disclosures [Abstract] | |||
Impaired bank loan participations held for investment | $ 695 | $ 7,900 | |
Allowance for credit losses on bank loan participations | 530 | $ 242 | |
Unpaid principal on bank loan participations for which external sources were unavailable to determine fair value | 6,300 | 14,100 | |
Carrying value of bank loan participations for which external sources were unavailable to determine fair value | $ 5,500 | $ 12,700 |
Capital Stock and Equity Awar56
Capital Stock and Equity Awards (Details) - Dividends Declared - USD ($) $ / shares in Units, $ in Millions | Aug. 05, 2015 | May. 05, 2015 | Feb. 17, 2015 | Aug. 27, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Date of Declaration | Aug. 5, 2015 | May 5, 2015 | Feb. 17, 2015 | Aug. 27, 2014 |
Dividend per Common Share | $ 0.16 | $ 0.16 | $ 0.16 | $ 2.45 |
Payable to Shareholders of Record on | Sep. 14, 2015 | Jun. 15, 2015 | Mar. 16, 2015 | |
Payment Date | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | |
Total Amount | $ 4.6 | $ 4.6 | $ 4.6 | $ 70 |
Capital Stock and Equity Awar57
Capital Stock and Equity Awards (Details 1) - $ / shares | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Shares | ||
Exercised | (804,875) | |
Options | ||
Shares | ||
Outstanding, Beginning of period | 3,104,768 | 2,166,250 |
Granted | 10,627 | |
Exercised | (804,875) | |
Lapsed | (9,810) | (5,000) |
Outstanding, End of period | 2,300,710 | 2,161,250 |
Exercisable, end of period | 999,500 | 1,668,250 |
Weighted- Average Exercise Price | ||
Outstanding, Beginning of period | $ 17.27 | $ 15.51 |
Granted | 24.32 | |
Exercised | 15.66 | |
Lapsed | 21 | $ 15.65 |
Outstanding, End of period | 17.85 | 15.51 |
Exercisable, end of period | $ 15.34 | $ 15.49 |
Capital Stock and Equity Awar58
Capital Stock and Equity Awards (Details 2) - RSUs | 9 Months Ended |
Sep. 30, 2015$ / sharesshares | |
Shares | |
Unvested, beginning of period | 340,474 |
Granted | |
Unvested, end of period | 340,474 |
Weighted- Average Grant Date Fair Value | |
Unvested, beginning of period | $ / shares | $ 21 |
Granted | $ / shares | |
Unvested, end of period | $ / shares | $ 21 |
Capital Stock and Equity Awar59
Capital Stock and Equity Awards (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Stockholders' Equity Note [Abstract] | ||||
Share based compensation expense | $ 940 | $ 99 | $ 2,794 | $ 312 |
U.S. tax benefit on share based compensation expense | $ 260 | $ 21 | $ 765 | $ 62 |
Capital Stock and Equity Awar60
Capital Stock and Equity Awards (Detail Textuals) - USD ($) $ / shares in Units, $ in Millions | Aug. 05, 2015 | May. 05, 2015 | Feb. 17, 2015 | Aug. 27, 2014 | Dec. 31, 2014 | Sep. 30, 2014 | Sep. 30, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of vested stock options exercised | 804,875 | ||||||
Common stock, shares issued | 28,540,350 | 28,769,487 | |||||
Common stock, shares outstanding | 28,540,350 | 28,769,487 | |||||
Dividends paid | $ 5 | $ 65 | |||||
Dividends Declared | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Dividend payable, date declared | Aug. 5, 2015 | May 5, 2015 | Feb. 17, 2015 | Aug. 27, 2014 | |||
Dividends payable, per common share | $ 0.16 | $ 0.16 | $ 0.16 | $ 2.45 | |||
Dividends payable, amount | $ 4.6 | $ 4.6 | $ 4.6 | $ 70 |
Capital Stock and Equity Awar61
Capital Stock and Equity Awards (Detail Textuals 1) $ in Millions | 9 Months Ended |
Sep. 30, 2015USD ($)shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized share based compensation expense | $ | $ 8.4 |
Weighted-average period of unrecognized share based compensation expense | 2 years 7 months 6 days |
Weighted-average remaining contractual life of options outstanding | 4 years 3 months 18 days |
Weighted-average remaining contractual life of options exercisable | 2 years 4 months 24 days |
2014 Long Term Incentive Plan ("2014 LTIP") | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Maximum number of shares available for issuance | 3,171,150 |
Number of shares available for grant | 1,843,481 |
2014 Non-Employee Director Incentive Plan ("2014 Director Plan") | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Maximum number of shares available for issuance | 50,000 |
Number of shares available for grant | 42,860 |
Subsequent Events (Detail Textu
Subsequent Events (Detail Textuals) - USD ($) $ / shares in Units, $ in Millions | Nov. 03, 2015 | Aug. 05, 2015 | May. 05, 2015 | Oct. 31, 2015 | Feb. 17, 2015 | Aug. 27, 2014 |
Dividends Declared | ||||||
Subsequent Event [Line Items] | ||||||
Dividend payable, date declared | Aug. 5, 2015 | May 5, 2015 | Feb. 17, 2015 | Aug. 27, 2014 | ||
Cash dividend declared per share | $ 0.16 | $ 0.16 | $ 0.16 | $ 2.45 | ||
Dividend payable, date | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | |||
Subsequent event | Bridge Loan | ||||||
Subsequent Event [Line Items] | ||||||
Repayment of bridge loan | $ 13.8 | |||||
Subsequent event | December 28, 2015 | Dividends Declared | ||||||
Subsequent Event [Line Items] | ||||||
Dividend payable, date declared | Nov. 3, 2015 | |||||
Cash dividend declared per share | $ 0.16 | |||||
Dividend payable, date | Dec. 28, 2015 | |||||
Subsequent event | December 28, 2015 | Dividends Declared | ||||||
Subsequent Event [Line Items] | ||||||
Dividend payable, date declared | Nov. 3, 2015 | |||||
Cash dividend declared per share | $ 1 | |||||
Dividend payable, date | Dec. 28, 2015 |