ProSight Global (PROS) 10-Q 12 May 20 2020 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2020	May 12, 2020
Document and Entity Information
Document Type	10-Q
Document Period End Date	Mar. 31, 2020
Entity Registrant Name	ProSight Global, Inc.
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		43,342,399
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Entity Central Index Key	0001634038
Amendment Flag	false

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Assets
Fixed maturity securities, available-for-sale at fair value (amortized cost $2,038,469 in 2020 and $1,999,403 in 2019, allowance for credit losses $(416) in 2020 and $0 in 2019)	$ 2,002,420	$ 2,040,682
Commercial levered loans at amortized cost (fair value $12,246 in 2020 and $13,950 in 2019)	13,725	14,069
Non-redeemable preferred stock securities at fair value (amortized cost $11,669 in 2020 and $0 in 2019)	11,378
Limited partnerships and limited liability companies at fair value (cost $67,445 in 2020 and $62,226 in 2019)	65,011	66,660
Short-term investments	19,229	43,873
Total investments	2,111,763	2,165,284
Cash and cash equivalents	43,141	17,284
Restricted cash	8,786	10,213
Accrued investment income	13,812	13,610
Premiums and other receivables, net	156,241	190,004
Receivable from reinsurers on paid losses, net	4,876	3,481
Reinsurance receivables on unpaid losses, net	156,866	193,952
Deferred policy acquisition costs	99,842	98,812
Prepaid reinsurance premiums	40,383	42,861
Net deferred income taxes	20,598	4,803
Goodwill and net intangible assets	29,181	29,189
Fixed assets and capitalized software, net	36,313	37,167
Funds withheld related to sale of affiliate	19,529	19,453
Other assets	21,615	29,537
Assets of discontinued operations	23,342	21,584
Total assets	2,786,288	2,877,234
Liabilities
Reserve for unpaid losses and loss adjustment expenses	1,545,799	1,521,648
Reserve for unearned premiums	468,486	483,223
Ceded reinsurance payable	13,148	17,768
Notes payable, net of debt issuance costs	164,778	164,693
Funds held under reinsurance agreements	23,374	58,855
Other liabilities	48,843	56,438
Liabilities of discontinued operations	33,758	31,578
Total liabilities	2,298,186	2,334,203
Stockholders’ equity
Preferred stock, $0.01 par value; 50,000,000 shares authorized; no shares issued or outstanding
Common stock, $0.01 par value; 200,000,000 shares authorized; 43,355,319 and 43,071,186 shares issued, 43,342,399 and 43,058,266 shares outstanding in 2020 and 2019, respectively	433	431
Paid-in capital	661,203	661,761
Accumulated other comprehensive (loss) income	(23,988)	37,453
Retained deficit	(149,346)	(156,414)
Treasury shares - at cost (12,920 shares)	(200)	(200)
Total stockholders’ equity	488,102	543,031
Total liabilities and stockholders’ equity	$ 2,786,288	$ 2,877,234

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Consolidated Balance Sheets
Fixed maturity securities, available-for-sale, amortized cost	$ 2,038,469	$ 1,999,403
Fixed maturity securities, available-for-sale, allowance for credit losses	(416)	0
Commercial levered loans, fair value	12,246	13,950
Non-redeemable, amortized cost	11,669	0
Limited partnerships and limited liability companies, cost	$ 67,445	$ 62,226
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	50,000,000	50,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	43,355,319	43,071,186
Common stock, shares outstanding	43,342,399	43,058,266
Treasury shares, shares	12,920

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Consolidated Statements of Operations
Gross written premiums	$ 213,784	$ 255,838
Net earned premiums	205,662	195,608
Net investment income	8,815	17,158
Realized investment gains, net	232	113
Other income	112	93
Total revenues	214,821	212,972
Expenses:
Net losses and loss adjustment expenses incurred	127,557	118,333
Policy acquisition expenses	46,986	46,573
General and administrative expenses	26,637	27,194
Interest expense	3,105	3,362
Other expense	1,737
Total expenses	206,022	195,462
Net income from continuing operations before income taxes	8,799	17,510
Income tax provision:
Current	1,631	141
Deferred	357	3,674
Total income tax expense	1,988	3,815
Net income from continuing operations	6,811	13,695
Discontinued operations:
Net income (loss) from discontinued operations	257	(255)
Net income	$ 7,068	$ 13,440
Earnings per share – basic:
Net income from continuing operations	$ 0.16	$ 0.35
Net income	0.16	0.35
Earnings per share – diluted:
Net income from continuing operations	0.15	0.35
Net income	$ 0.16	$ 0.34

Consolidated Statements of Comp

Consolidated Statements of Comprehensive (Loss) Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Consolidated Statements of Comprehensive (Loss) Income
Net income	$ 7,068	$ 13,440
Other comprehensive (loss) income, net of taxes:
Change in unrealized holding (losses) gains on available-for-sale debt securities, net of deferred tax (benefit) expense of $(16,102) in 2020 and $7,241 in 2019	(60,964)	27,562
Less: reclassification adjustment for gains (losses) included in net income, net of tax expense (benefit) of $136 in 2020 and $(24) in 2019	806	(190)
Less: reclassification adjustment for credit losses included in net income, net of tax benefit of $(87) in 2020 and $0 in 2019	(329)
Other comprehensive (loss) income	(61,441)	27,752
Comprehensive (loss) income	$ (54,373)	$ 41,192

Consolidated Statements of Co_2

Consolidated Statements of Comprehensive (Loss) Income (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Consolidated Statements of Comprehensive (Loss) Income
Change in unrealized holding (losses) gains on securities, deferred tax (benefit) expense	$ (16,102)	$ 7,241
Reclassification adjustment for (losses) gains included in net income, tax expense (benefit)	136	(24)
Reclassification adjustment for credit losses included in net income, tax expense (benefit)	$ (87)	$ 0

Consolidated Statements of Chan

Consolidated Statements of Changes in Stockholders Equity - USD ($) $ in Thousands	Common stock	Paid-in capital	Accumulated other comprehensive (loss) income	Retained deficit	Treasury shares	Total
Balance at the beginning of the period at Dec. 31, 2018	$ 389	$ 607,260	$ (22,315)	$ (195,304)	$ (200)	$ 389,830
Increase (decrease) in Stockholders' Equity
Stock based employee compensation plan		77				77
Net unrealized gain (loss) on investment securities, net of deferred tax expense			27,752			27,752
Equity distribution		(4,174)				(4,174)
Net income				13,440		13,440
Balance at the end of the period at Mar. 31, 2019	389	603,163	5,437	(181,864)	(200)	426,925
Balance at the beginning of the period at Dec. 31, 2019	431	661,761	37,453	(156,414)	(200)	543,031
Increase (decrease) in Stockholders' Equity
Stock based employee compensation plan	2	1,754				1,756
Retirement of common stock (tax payments on equity compensation)		(2,263)				(2,263)
Net unrealized gain (loss) on investment securities, net of deferred tax expense			(61,441)			(61,441)
Payments related to offering costs		(49)				(49)
Net income				7,068		7,068
Balance at the end of the period at Mar. 31, 2020	$ 433	$ 661,203	$ (23,988)	$ (149,346)	$ (200)	$ 488,102

Consolidated Statements of Ch_2

Consolidated Statements of Changes in Stockholders Equity (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Consolidated Statements of Changes in Stockholders’ Equity
Net unrealized (loss) gain on investment securities, deferred tax (benefit)	$ (16,151)	$ 7,265

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Operating activities
Net income from continuing operations	$ 6,811	$ 13,695
Net income (loss) from discontinued operations	257	(255)
Net income	7,068	13,440
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for deferred taxes	357	3,674
Realized investment gains, net	(232)	(113)
Net limited partnerships losses (gains)	6,877	(1,251)
Net amortization (accretion) from bonds and commercial loans	598	(861)
Net change in fair value of non-redeemable preferred stock securities	291
Depreciation and amortization	1,987	2,100
Amortization of debt issuance costs	85
Stock based compensation	1,754	77
Changes in:
Premiums and other receivables, net	33,763	3,857
Receivable from reinsurers on paid losses and reinsurance receivable on unpaid losses	35,691	(20,033)
Ceded reinsurance payable	(4,620)	2,271
Accrued investment income	(202)	(229)
Deferred policy acquisition costs	(1,030)	(6,768)
Prepaid reinsurance premiums	2,478	(19,501)
Reserve for unpaid losses and loss adjustment expenses	24,151	52,723
Reserve for unearned premiums	(14,737)	34,027
Funds withheld related to sale of affiliate	(76)
Funds held under reinsurance agreements	(35,481)	14,621
Other assets	7,924	21,198
Other liabilities	(7,595)	(14,571)
Total adjustments	51,983	71,221
Net cash provided by operating activities – continuing operations	58,794	84,916
Net cash provided by (used in) operating activities – discontinued operations	62	(107)
Net cash provided by operating activities	58,856	84,809
Investing activities
Purchases of available-for-sale fixed maturity securities	(191,915)	(80,986)
Sales of available-for-sale fixed maturity securities	114,474	5,228
Redemptions of available-for-sale fixed maturity securities	38,376	38,218
Purchases of non-redeemable preferred stock securities	(11,669)
Redemptions of commercial levered loans	346	111
Purchases of limited partnerships	(6,873)	(1,944)
Distributions and redemptions from limited partnerships	1,644	793
Purchases of short-term investments	(25,634)	(126,088)
Sales of short-term investments	50,323	93,761
Acquisition of fixed assets and capitalized software	(1,125)	(1,654)
Net cash used in investing activities - continuing operations	(32,053)	(72,561)
Net cash (used in) provided by investing activities - discontinued operations	(15)	466
Net cash used in investing activities	(32,068)	(72,095)
Financing activities
Payments related to offering costs	(49)
Tax withholding on stock compensation awards	(2,263)
Net cash used in financing activities	(2,312)
Net change in cash and cash equivalents	24,476	12,714
Cash, cash equivalents and restricted cash at beginning of year - continuing operations	27,497	29,900
Cash, cash equivalents and restricted cash at beginning of year- discontinued operations	255	1,034
Less: cash, cash equivalents and restricted cash at end of period - discontinued operations	(301)	(1,348)
Cash, cash equivalents and restricted cash at end of period - continuing operations	$ 51,927	$ 42,300

Basis of Reporting

Basis of Reporting	3 Months Ended
	Mar. 31, 2020
Basis of Reporting
Basis of Reporting	1. Basis of Reporting The accompanying unaudited interim consolidated financial statements of ProSight Global, Inc. and its subsidiaries (the “Company”) have been prepared in conformity 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 unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto included in the Company’s 2019 Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 24, 2020, as amended by Amendment No. 1 to Form 10-K filed with the SEC on March 10, 2020. In the opinion of management, all adjustments necessary for a fair presentation of the consolidated financial statements have been included. Such adjustments consist only of normal recurring items. All significant intercompany balances and transactions have been eliminated in consolidation. Interim results are not necessarily indicative of results of operations for the full year. Prior to July 25, 2019, the Company was a wholly-owned subsidiary of ProSight Global Holdings Limited (“PGHL”), a Bermuda holding company. Effective July 25, 2019, prior to the completion of the Company’s initial public offering (“IPO”), PGHL merged with and into the Company, with the Company surviving the merger (the “merger”). The prior holders of PGHL’s equity interests then outstanding received, as merger consideration, the right to receive 6.46 shares of the Company’s common stock for each such outstanding PGHL equity interest. All share and per share amounts in the unaudited interim consolidated financial statements and related notes have been restated for all historical periods prior to July 25, 2019, presented to give effect to the merger and related conversion of shares, including reclassifying an amount equal to the change in value of common stock to additional paid-in capital, as well as the effectiveness of the Certificate of Incorporation. Use of Estimates The preparation of the unaudited interim consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the financial statement balances, as well as disclosure of contingent assets and liabilities. Actual results could differ from those estimates. Management periodically reviews its estimates and assumptions.

Recently Adopted Accounting Sta

Recently Adopted Accounting Standards	3 Months Ended
	Mar. 31, 2020
Recently Adopted Accounting Standards
Recently Adopted Accounting Standards	2. Recently Adopted Accounting Standards Accounting Guidance Adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016‑02, Leases (“ASU 2016-02”) to improve the financial reporting of leasing transactions. Under this ASU, lessees will recognize a right-of-use asset and corresponding liability on the balance sheet for all leases, except for leases covering a period of fewer than 12 months. The liability is to be measured as the present value of the future minimum lease payments taking into account renewal options, if applicable, plus initial incremental direct costs such as commissions. The minimum payments are discounted using the rate implicit in the lease or, if not known, the lessee’s incremental borrowing rate. The lessee’s income statement treatment for leases will vary depending on the nature of the lease. A financing type lease is present when, among other matters, the asset is being leased for a substantial portion of its economic life or has an end-of-term title transfer or a bargain purchase option as in today’s practice. The payment of the liability set up for such leases will be apportioned between interest and principal; the right-of use asset will be generally amortized on a straight-line basis. If the lease does not qualify as a financing type lease, it will be accounted for on the income statement as rent on a straight-line basis. ASU 2016‑02 requires the application of a modified retrospective approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company adopted ASU 2016‑02 in the first quarter of 2020, and as part of its implementation, elected the modified retrospective method approach at the beginning of the period of adoption and did not retrospectively adjust prior periods presented. The Company elected to not separate lease components from non-lease components (such as office cleanings, security and maintenance services provided by the Company’s lessors for certain of its leases). The Company also elected the package of practical expedients under the transition guidance, which allowed the Company to not reevaluate existing lease classifications, among others. As of January 1, 2020, the Company’s adoption of this guidance resulted in recognition of a right-of-use asset of $5.6 million and a corresponding lease liability of $6.3 million in continuing operations, and a right-of-use asset of $2.5 million and a corresponding lease liability of $3.0 million in discontinued operations. The adoption of this guidance did not have a material impact on the Company’s retained earnings. See Note 15. Leases for further information on the Company’s leases. In June 2016, the FASB issued ASU 2016‑13, Financial Instruments — Credit Losses, Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016‑13 will change the way entities recognize impairment of financial assets by requiring immediate recognition of estimated credit losses expected to occur over the remaining life of many financial assets, including, among others, held-to-maturity debt securities, trade receivables, and reinsurance receivables. ASU 2016‑13 requires a valuation allowance to be calculated on these financial assets and that they be presented on the financial statements net of the valuation allowance. The valuation allowance is a measurement of expected losses that is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. This methodology is referred to as the current expected credit loss model. The Company adopted ASU 2016-13 in the first quarter of 2020 using a modified retrospective approach. As of January 1, 2020, the Company’s adoption of this guidance did not have a material impact on the Company’s retained earnings. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement: Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”) . ASU 2018-13 modifies the disclosure requirements for fair value measurements. The modifications removed the following disclosure requirements: (i) the amount of, and reasons for, transfers between Level 1 and Level 2 of the fair value hierarchy; (ii) the policy for timing of transfers between levels; and (iii) the valuation processes for Level 3 fair value measurements. This ASU added the following disclosure requirements: (i) the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period; and (ii) the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. The Company adopted ASU 2018-13 in the first quarter of 2020 using a retrospective approach and as the requirements of this literature are disclosure only, ASU 2018-13 did not have an impact on the Company’s financial condition or results of operations. Accounting Guidance Not Yet Adopted In March 2017, the FASB issued ASU 2017-08, Premium Amortization on Purchased Callable Debt Securities (“ASU 2017-08”). ASU 2017-08 shortens the amortization period of the premium for certain callable debt securities, from the contractual maturity date to the earliest call date. ASU 2017-08 is effective for public entities for annual periods beginning after December 15, 2018, including interim periods within those annual periods, with early adoption permitted. For the Company, ASU 2017-08 is effective for annual periods beginning after December 15, 2019 and interim periods within annual periods beginning after December 15, 2020. The Company is currently evaluating the impact of this guidance on its financial condition or results of operations. In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2016-15”) . ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. ASU 2018-15 provides the option to apply prospectively to costs for activities performed on or after the date that the entity first adopts or retrospectively in accordance with guidance on accounting changes. ASU 2018-15 is effective for public entities for annual periods beginning after December 15, 2019, including interim periods within those annual periods, with early adoption permitted. For the Company, ASU 2018-15 is effective for annual periods beginning after December 15, 2020 and interim periods within annual periods beginning after December 15, 2021. The Company is currently evaluating the impact of this guidance on its financial condition or results of operations. In December 2019, the FASB issued ASU 2019-12, Income Taxes - Simplifying the Accounting for Income Taxes (“ASU 2019-12”). Among other items, the amendments in ASU 2019-12 simplify the accounting treatment of tax law changes and year-to-date losses in interim periods. An entity generally recognizes the effects of a change in tax law in the period of enactment; however, there is an exception for tax laws with delayed effective dates. Under current guidance, an entity may not adjust its annual effective tax rate for a tax law change until the period in which the law is effective. This exception was removed under ASU 2019-12, thereby providing that all effects of a tax law change are recognized in the period of enactment, including adjustment of the estimated annual effective tax rate. Regarding year-to-date losses in interim periods, an entity is required to estimate its annual effective tax rate for the full fiscal year at the end of each interim period and use that rate to calculate its income taxes on a year-to-date basis. However, current guidance provides an exception that when a loss in an interim period exceeds the anticipate loss for the year, the income tax benefit is limited to the amount that would be recognized if the year-to-date loss were the anticipated loss for the full year. ASU 2019-12 removes this exception and provides that in this situation, an entity would compute its income tax benefit at each interim period based on its estimated annual effective tax rate. ASU 2019-12 is effective for public entities for annual periods beginning after December 15, 2020, including interim periods within those annual periods, with early adoption permitted. For the Company, ASU 2019-12 is effective for annual periods beginning after December 15, 2021 and interim periods within annual periods beginning after December 15, 2021. The Company is currently evaluating the impact of this guidance on its financial condition or results of operations. In January 2020, the FASB issued ASU 2020-01, Investments – Equity Securities (Topic 321), Investments – Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) (“ASU 2020-01”). ASU 2020-01 will clarify certain interactions between the guidance to account for certain equity securities under Topic 321, the guidance to account for investments under the equity method of accounting in Topic 323, and the guidance in Topic 815, which could change how an entity accounts for an equity security under the measurement alternative or a forward contract or exercise of the purchased option, would be accounted for under the equity method of accounting or the fair value option in accordance with Topic 825, Financial Instruments. ASU 2020-01 is effective for public entities for annual periods beginning after December 15, 2020, including interim periods within those annual periods, with early adoption permitted. For the Company, ASU 2020-01 is effective for annual periods beginning after December 15, 2021 and interim periods within annual periods beginning after December 15, 2021. The Company is currently evaluating the impact of this guidance on its financial condition or results of operations.

Supplemental Cash Flow

Supplemental Cash Flow	3 Months Ended
	Mar. 31, 2020
Supplemental Cash Flow
Supplemental Cash Flow	3. Supplemental Cash Flow The following table represents the supplemental cash flow information for the three months ended March 31, 2020 and 2019: Three Months Ended March 31 ($ in thousands) 2020 2019 Non-cash activity: Operating lease right-of-use assets due to adoption of ASU 2016-02 - continuing operations $ 4,810 $ — Operating lease right-of-use assets due to adoption of ASU 2016-02 - discontinued operations $ 2,287 $ — Operating lease liabilities due to adoption of ASU 2016-02 - continuing operations $ 5,533 $ — Operating lease liabilities due to adoption of ASU 2016-02 - discontinued operations $ 2,665 $ — In March 2020, the Company withheld 154,629 shares of common stock from employees related to tax liabilities incurred upon the settlement of vested restricted stock units (“RSUs”). The number of shares of common stock issued, upon the settlement of vested RSUs net of tax withholding, was 284,133.

Discontinued Operations

Discontinued Operations	3 Months Ended
	Mar. 31, 2020
Discontinued Operations
Discontinued Operations	4. Discontinued Operations In March 2017, the Company announced its exit from the United Kingdom (“U.K.”) insurance market. The financial results and subsequent expenses directly attributable to U.K. operations are included in the Company’s financial statements and classified within discontinued operations for all periods presented. Net income for discontinued operations was $0.3 million for the three months ended March 31, 2020. Net loss for discontinued operations was $0.3 million for the three months ended March 31, 2019. The following table represents the carrying amounts of assets and liabilities associated with the exit from the insurance market in the U.K. reported as discontinued operations in its consolidated balance sheets: March 31, December 31, ($ in thousands) 2020 2019 Assets Cash and investments $ 10,080 $ 10,428 Other assets 13,262 11,156 Total assets $ 23,342 $ 21,584 Liabilities Reserve for unpaid losses and loss adjustment expenses $ 24,149 $ 24,169 Other liabilities 9,609 7,409 Total liabilities $ 33,758 $ 31,578

Investments

Investments	3 Months Ended
	Mar. 31, 2020
Investments
Investments	5. Investments The Company’s investment portfolio consists of fixed maturity securities, commercial levered loans, limited partnerships and limited liability companies, non-redeemable preferred stock securities, and short-term investments. Fixed maturity securities may include U.S. Treasury securities, government agency securities, municipal debt obligations, residential mortgage-backed securities (“RMBS”), commercial mortgage-backed securities (“CMBS”), collateralized loan obligations (“CLO”), asset-backed securities (“ABS”) and corporate debt securities. Corporate debt securities may include investment grade and below investment grade bonds, bank loan investments and redeemable preferred stock securities. The Company has designated its investments in fixed maturity securities as available-for-sale (“AFS”) securities. (a) The gross unrealized gains and losses on fixed maturity securities included in assets from continuing operations at March 31, 2020, are as follows: Cost/ Gross Gross Amortized Credit Loss Unrealized Unrealized Fair ($ in thousands) Cost Allowance Gains Losses Value Fixed maturity securities: U.S. Treasury securities $ 40,679 $ — $ 2,643 $ — $ 43,322 Government agency securities 27,998 — 591 — 28,589 Corporate debt securities 1,317,091 (293) 22,167 (37,278) 1,301,687 Municipal debt obligations 103,271 — 813 (3,443) 100,641 ABS 49,205 (1) 26 (3,210) 46,020 CLO 177,411 (6) — (19,842) 157,563 CMBS 94,816 — 1,603 (1,945) 94,474 RMBS - non-agency 92,189 (116) 3,411 (4,851) 90,633 RMBS - agency 135,809 — 3,738 (56) 139,491 Total fixed maturity securities $ 2,038,469 $ (416) $ 34,992 $ (70,625) $ 2,002,420 The gross unrealized gains and losses on fixed maturity securities included in assets from continuing operations at December 31, 2019, are as follows: Cost/ Gross Gross Amortized Unrealized Unrealized Fair ($ in thousands) Cost Gains Losses Value Fixed maturity securities: U.S. Treasury securities $ 49,161 $ 838 $ (14) $ 49,985 Government agency securities 6,522 23 (14) 6,531 Corporate debt securities 1,308,094 33,743 (3,025) 1,338,812 Municipal debt obligations 80,338 243 (766) 79,815 ABS 73,068 854 (340) 73,582 CLO 181,704 125 (2,280) 179,549 CMBS 95,810 1,863 (147) 97,526 RMBS - non-agency 62,343 9,458 (191) 71,610 RMBS - agency 142,363 1,256 (347) 143,272 Total fixed maturity securities $ 1,999,403 $ 48,403 $ (7,124) $ 2,040,682 (b) The following table summarizes the fair values and gross unrealized losses for fixed maturity securities in an unrealized loss position at March 31, 2020, grouped by asset class and by duration of time in a continuous unrealized loss position: Less Than 12 Months Greater Than 12 Months Total Total Fair Unrealized Fair Unrealized Total Unrealized ($ in thousands) Value Losses Value Losses Fair Value Losses Corporate debt securities $ 495,656 $ (31,005) $ 83,577 $ (6,273) $ 579,233 $ (37,278) Municipal debt obligations 66,579 (3,278) 5,584 (165) 72,163 (3,443) ABS 33,474 (2,604) 8,425 (606) 41,899 (3,210) CLO 59,491 (5,053) 98,072 (14,789) 157,563 (19,842) CMBS 26,478 (1,935) 3,031 (10) 29,509 (1,945) RMBS - non-agency 45,431 (3,042) 12,115 (1,809) 57,546 (4,851) RMBS - agency 6,585 (55) 1 (1) 6,586 (56) Total fixed maturity securities $ 733,694 $ (46,972) $ 210,805 $ (23,653) $ 944,499 $ (70,625) The following table summarizes the fair values and gross unrealized losses for fixed maturity securities in an unrealized loss position at December 31, 2019, grouped by asset class and by duration of time in a continuous unrealized loss position: Less Than 12 Months Greater Than 12 Months Total Total Fair Unrealized Fair Unrealized Total Unrealized ($ in thousands) Value Losses Value Losses Fair Value Losses U.S. Treasury securities $ — $ — $ 7,469 $ (14) $ 7,469 $ (14) Government agency securities 3,192 (14) — — 3,192 (14) Corporate debt securities 133,341 (2,509) 50,695 (516) 184,036 (3,025) Municipal debt obligations 66,355 (766) — — 66,355 (766) ABS 27,884 (175) 11,165 (165) 39,049 (340) CLO 28,485 (338) 110,825 (1,942) 139,310 (2,280) CMBS 18,307 (102) 6,053 (45) 24,360 (147) RMBS - non-agency 2,173 (14) 2,418 (177) 4,591 (191) RMBS - agency 10,450 (12) 12,367 (335) 22,817 (347) Total fixed maturity securities $ 290,187 $ (3,930) $ 200,992 $ (3,194) $ 491,179 $ (7,124) (c) The Company was holding 500 and 313 fixed maturity securities that were in an unrealized loss position as of March 31, 2020 and December 31, 2019, respectively. The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity. The Company analyzes fixed maturity securities in an unrealized loss position for credit losses if they meet the following criteria: (i) they are trading in a significant loss position, (ii) there are principal or interest payment issues, (iii) there have been negative credit events with respect to the issuer, or (iv) there have been negative current events surrounding an issuer or the environment in which an issuer operates. For fixed maturity securities in an unrealized loss position that require a credit loss analysis, the Company estimates a present value of expect cash flows. If the results of the cash flow analysis indicate that the Company will not recover the full amount of its amortized cost basis, the Company records a credit loss for the excess of amortized cost over the present value of expected cash flows, not to exceed the unrealized loss. Changes in the credit loss allowance are recognized through realized investment gains, net on the consolidated statements of operations. The credit loss allowance for fixed maturity securities was $0.4 million for the three months ended March 31, 2020. The following table is a rollforward of the credit loss allowance for fixed maturity securities as of March 31, 2020: Beginning Additions Reduction Reduction Change in Securities Ending ($ in thousands) Balance New Securities Sales Intent to Sell with Previous Allowance Balance Fixed maturity securities: Corporate debt securities $ — $ 293 $ — $ — $ — $ 293 ABS — 1 — — — 1 CLO — 6 — — — 6 RMBS - non-agency — 116 — — — 116 Total fixed maturity securities allowance $ — $ 416 $ — $ — $ — $ 416 (d) The amortized cost and fair value of fixed maturity securities, excluding the Company’s structured securities portfolio, at March 31, 2020, by contractual maturity are shown below. Expected maturities will differ from contractual maturities, because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. March 31, 2020 Amortized Fair ($ in thousands) Cost Value Due in one year or less $ 103,407 $ 103,498 Due after one through five years 659,203 657,184 Due after five through ten years 449,535 445,004 Due after ten years 248,896 239,964 1,461,041 1,445,650 Structured securities: Government agency securities 27,998 28,589 ABS 49,205 46,020 CLO 177,411 157,563 CMBS 94,816 94,474 RMBS - non-agency 92,189 90,633 RMBS - agency 135,809 139,491 Total fixed maturity securities $ 2,038,469 $ 2,002,420 The Company did not have any non-income producing fixed maturity investments as of March 31, 2020 and December 31, 2019, respectively. (e) The Company elected to account for its investments in limited partnerships and limited liability companies of $65.0 million and $66.7 million at March 31, 2020 and December 31, 2019, respectively, at fair value. Changes in fair value of such investments are recorded in the consolidated statements of operations within net investment income. The largest investment within the portfolio is the Pacific Investment Management Company LLC Tactical Opportunities fund, which is carried at $34.0 million at March 31, 2020. The carrying values used for investment in limited partnerships and limited liability companies generally are established on the basis of the current valuations provided by the managers of such investments. These valuations are determined based upon the valuation criteria established by the governing documents of such investments or utilized in the normal course of such manager’s business, which are reflective of fair value. Such valuations may differ significantly from the values that would have been used had available markets for these investments existed and the differences could be material. The Company’s strategies for its investments in limited partnerships and limited liability companies include investment funds that employ diverse and fundamentally driven approaches to investing which include effective risk management, hedging strategies and leverage. The portfolio of investments in limited partnerships and limited liability companies consists of common stocks, real estate assets, options, swaps, derivative instruments and other structured products. The limited partnerships and limited liability companies in which the Company invests sometimes impose limitations on the timing of withdrawals from the funds. The Company’s inability to withdraw its investment quickly from a particular limited partnership or a limited liability company that is performing poorly could result in losses and may affect liquidity. All of the Company’s limited partnerships and limited liability companies have timing limitations. Most limited partnerships and limited liability companies require a 90-day notice period in order to withdraw funds. Some limited partnerships and limited liability companies may require a withdrawal only at the end of their fiscal year. The Company may also be subject to withdrawal fees in the event the limited partnerships and limited liability companies are sold within a minimum holding period, which may be up to one year. Many limited partnerships and limited liability companies have invoked gated provisions that allow the fund to disperse redemption proceeds to investors over an extended period. The Company is subject to such restrictions, which may delay the receipt of proceeds from limited partnerships and limited liability companies. (f) The Company invests in commercial loans, which are private placements. Loans are reported at the principal amount outstanding, reduced by unearned discounts, net deferred loan fees, and an allowance for credit losses on loans. Interest on loans is calculated using the simple interest method on the daily principal amount outstanding. There was no allowance for credit losses on loan at March 31, 2020 and December 31, 2019, respectively. (g) Proceeds from sales and redemptions in AFS securities totaled $152.8 million and $43.4 million for the three months ended March 31, 2020 and 2019, respectively. Gross realized gains from sales and redemptions in AFS securities totaled $1.0 million and $0.2 million for the three months ended March 31, 2020 and 2019, respectively. Gross realized losses from sales and redemptions of AFS investments totaled $0.4 million and $0.1 million for the three months ended March 31, 2020 and 2019, respectively. (h) Net investment income included in net income from continuing operations in the consolidated statements of operations from each major category of investments for the three months ended March 31, 2020 and 2019, is as follows: Three Months Ended March 31 ($ in thousands) 2020 2019 Fixed maturity securities $ 16,282 $ 16,119 Commercial levered loans 95 219 Net limited partnerships (losses) gains (6,877) 1,251 Other (10) 89 Gross investment income 9,490 17,678 Less: investment income attributable to funds withheld liabilities 136 142 Less: expenses 539 378 Net investment income $ 8,815 $ 17,158 (i) Included in investments at March 31, 2020 and December 31, 2019, are securities required to be held by the Company (or those that are on deposit) with various regulatory authorities as required by law with a fair value of $208.3 million and $210.8 million, respectively. Fair value and carrying value of assets in the amount of $376.9 million and $379.5 million, respectively, were on deposit in collateral agreements at March 31, 2020. Fair value and carrying value of assets in the amount of $367.1 million and $352.0 million, respectively, were on deposit in collateral agreements at December 31, 2019. (j) The investment portfolio has exposure to market risks, which include the effect of adverse changes in interest rates, credit quality, limited partnership value and illiquid securities, including commercial loan values, on the portfolio. Interest rate risk includes the changes in the fair value of fixed maturities based upon changes in interest rates. Credit quality risk includes the risk of default by issuers of debt securities. Risks from investments in limited partnerships and limited liability companies and illiquid securities risks include the potential loss from the diminution in the value of the underlying investment of the limited partnerships and limited liability companies and the potential loss from changes in the fair value of commercial loans. (k) Non-redeemable preferred stock securities with readily determinable fair values are recorded at fair value. Changes in fair value of such investments are recorded in the consolidated statements of operations within net investment income. The change in fair value r ecognized in income on non-redeemable preferred stock securities for the three months ended March 31, 2020 was $0.3 million.

Fair Value Measurements

Fair Value Measurements	3 Months Ended
	Mar. 31, 2020
Fair Value Measurements
Fair Value Measurements	6. Fair Value Measurements The Company has established a framework for valuing financial assets and financial liabilities. The framework is based on a hierarchy of inputs used in valuation and gives the highest priority to quoted prices in active markets and requires that observable inputs be used in the valuations when available. The disclosure of fair value estimates in the hierarchy is based on whether the significant inputs into the valuation are observable. In determining the level of the hierarchy in which the estimate is disclosed, the highest priority is given to unadjusted quoted prices in active markets and the lowest priority to unobservable inputs that reflect the Company’s significant market assumptions. The standard describes three levels of inputs that may be used to measure fair value and categorize the assets and liabilities within the hierarchy: Level 1 – Fair value is based on unadjusted quoted prices in active markets that are accessible to the Company for identical assets or liabilities. These prices generally provide the most reliable evidence and are used to measure fair value whenever available. Active markets are defined as having the following for the measured asset/liability: (i) many transactions, (ii) current prices, (iii) price quotes not varying substantially among market makers, (iv) narrow bid/ask spreads and (v) most information publicly available. As of March 31, 2020 and December 31, 2019, the Company does not hold any Level 1 securities. Level 2 – Fair value is based on significant inputs, other than Level 1 inputs, that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset through corroboration with observable market data. Level 2 inputs include quoted market prices in active markets for similar assets, nonbinding quotes in markets that are not active for identical or similar assets and other market observable inputs (e.g., interest rates, yield curves, prepayment speeds, default rates, loss severities, etc.). The Company’s Level 2 assets include U.S. Treasury securities, government agency securities, municipal debt obligations, RMBS, CMBS, CLO, ABS, corporate debt securities and non-redeemable preferred stock securities. The Company generally obtains valuations from third-party pricing services and/or security dealers for identical or comparable assets or liabilities by obtaining nonbinding broker quotes (when pricing service information is not available) in order to determine an estimate of fair value. The Company bases all of its estimates of fair value for assets on the bid price as it represents what a third-party market participant would be willing to pay in an arm’s-length transaction. Level 3 – Fair value is based on at least one or more significant unobservable inputs that are supported by little or no market activity for the asset. These inputs reflect the Company’s understanding about the assumptions market participants would use in pricing the asset or liability. The Company’s Level 3 assets include its investments in corporate debt securities and commercial levered loans as they are illiquid and trade in inactive markets. These markets are considered inactive as a result of the low level of trades of such investments. Commercial levered loans are also not considered within the Level 3 tabular disclosure, because they are in the “held for investment” category and are also not measured at fair value on a recurring basis. The corporate debt securities classified under Level 3 in the fair value hierarchy are provided to the Company by an independent valuation service provider which use both observable and unobservable inputs in the calculation of fair value. Unobservable inputs, significant to the measurement and valuation of the corporate debt securities are assumptions about prepayment speed, default rates and reinvestment parameters. Significant changes to any of these inputs, or combination of inputs, could significantly change the fair value measurement for these securities when using the income approach. The primary pricing sources for the Company’s investments in commercial levered loans are reviewed for reasonableness, based on the Company’s understanding of the respective market. Prices may then be determined using valuation methodologies such as discounted cash flow models, as well as matrix pricing analyses performed on nonbinding quotes from brokers or other market makers. The following are the major categories of assets measured at fair value on a recurring basis at March 31, 2020 and December 31, 2019, using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3): March 31, 2020 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities: U.S. Treasury securities $ — $ 43,322 $ — $ 43,322 Government agency securities — 28,589 — 28,589 Corporate debt securities — 1,149,269 152,418 1,301,687 Municipal debt obligations — 100,641 — 100,641 ABS — 46,020 — 46,020 CLO — 157,563 — 157,563 CMBS — 94,474 — 94,474 RMBS - non agency — 90,633 — 90,633 RMBS - agency — 139,491 — 139,491 Total fixed maturity securities — 1,850,002 152,418 2,002,420 Non-redeemable preferred stock securities — 11,378 — 11,378 Total investments measured at fair value $ — $ 1,861,380 $ 152,418 2,013,798 Investments measured at net asset value: Limited partnerships and limited liability companies 65,011 Total assets at fair value $ 2,078,809 December 31, 2019 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities: U.S. Treasury securities $ — $ 49,985 $ — $ 49,985 Government agency securities — 6,531 — 6,531 Corporate debt securities — 1,189,181 149,631 1,338,812 Municipal debt obligations — 79,815 — 79,815 ABS — 73,582 — 73,582 CLO — 179,549 — 179,549 CMBS — 97,526 — 97,526 RMBS - non agency — 71,610 — 71,610 RMBS - agency — 143,272 — 143,272 Total investments measured at fair value $ — $ 1,891,051 $ 149,631 2,040,682 Investments measured at net asset value: Limited partnerships and limited liability companies 66,660 Total assets at fair value $ 2,107,342 Management believes that the use of the fair value option as specified in Accounting Standards Codification No. 825 , Financial Instruments to record limited partnerships and limited liability companies is consistent with its objective for such investments. As such, the entire limited partnership portfolio of $65.0 million and $66.7 million as of March 31, 2020 and December 31, 2019, respectively, was recorded using net asset value, which the Company has determined to be the best indicator of fair value for these investments. The following tables disclose the carrying value and fair value of financial instruments that are not recognized or are not carried at fair value in the consolidated balance sheets as of March 31, 2020 and December 31, 2019: March 31, 2020 Carrying Fair Value ($ in thousands) Value Total Level 1 Level 2 Level 3 Assets Commercial levered loans $ 13,725 $ 12,246 $ — $ — $ 12,246 Liabilities Notes payable $ 165,000 $ 166,288 $ — $ 166,288 $ — Unamortized debt issuance costs (222) Notes payable, net of debt issuance costs $ 164,778 December 31, 2019 Carrying Fair Value ($ in thousands) Value Total Level 1 Level 2 Level 3 Assets Commercial levered loans $ 14,069 $ 13,950 $ — $ — $ 13,950 Liabilities Notes payable $ 165,000 $ 167,507 $ — $ 167,507 $ — Unamortized debt issuance costs (307) Notes payable, net of debt issuance costs $ 164,693 The fair value of the notes payable at March 31, 2020, approximated a price equal to $166.3 million or 100.8% of the par value. The fair value of the notes payable at December 31, 2019, approximated a price equal to $167.5 million or 101.5% of the par value. The following tables provides a summary of the changes in the fair value of securities measured using Level 3 inputs during the three months ended March 31, 2020 and 2019: Level 3 Corporate Debt ($ in thousands) Securities Fair value, December 31, 2019 $ 149,631 Total net (losses) gains for the period included in: Other comprehensive loss (10,703) Net realized gain 1 Purchases 14,241 Sales — Issuances — Settlements (752) Transfers into Level 3 — Transfers out of Level 3 — Fair value, March 31, 2020 $ 152,418 Level 3 Corporate Debt ($ in thousands) Securities Fair value, December 31, 2018 $ 126,497 Total net losses for the period included in: Other comprehensive loss (1,273) Net realized loss (40) Purchases 2,329 Sales — Issuances — Settlements (1,373) Transfers into Level 3 — Transfers out of Level 3 — Fair value, March 31, 2019 $ 126,140

Accumulated Other Comprehensive

Accumulated Other Comprehensive (Loss) Income	3 Months Ended
	Mar. 31, 2020
Accumulated Other Comprehensive (Loss) Income [Abstract]
Accumulated Other Comprehensive (Loss) Income	7. Accumulated Other Comprehensive (Loss) Income The following table summarizes the components of accumulated other comprehensive (loss) income (“AOCI”) for the three months ended March 31, 2020 and 2019: ($ in thousands) Gross Tax Net December 31, 2019 $ 46,123 $ 8,670 $ 37,453 Unrealized holding losses on fixed maturity securities (77,066) (16,102) (60,964) Amounts reclassified into net income 942 136 806 Amounts reclassified as credit losses (416) (87) (329) Other comprehensive loss (77,592) (16,151) (61,441) March 31, 2020 $ (31,469) $ (7,481) $ (23,988) ($ in thousands) Gross Tax Net December 31, 2018 $ (29,760) $ (7,445) $ (22,315) Unrealized holding gains on fixed maturity securities 34,803 7,241 27,562 Amounts reclassified into net income (214) (24) (190) Other comprehensive income 35,017 7,265 27,752 March 31, 2019 $ 5,257 $ (180) $ 5,437 The following table presents reclassifications out of AOCI attributable to the Company during the three months ended March 31, 2020 and 2019: Line in Consolidated Three Months Ended March 31 ($ in thousands) Statements of Operations 2020 2019 AOCI Unrealized gains (losses) on securities Realized investment gains, net $ 942 $ (214) Income tax expense 136 (24) Reclassification adjustment for credit losses included in net income Realized investment losses, net (416) — Income tax expense (87) — Total reclassifications $ 477 $ (190)

Related-Party Information

Related-Party Information	3 Months Ended
	Mar. 31, 2020
Related-Party Information
Related-Party Information	8. Related-Party Information Loans to Executives and Equity Distribution The Company made loans of $4.2 million to certain executive officers, including the CEO. Most of the loans were made in connection with the settlement of RSUs and related tax withholdings . On March 15, 2019, all such loans were deemed repaid. On the same date, a special equity distribution of $4.2 million was made by the Company to the same executive officers, which was accounted for as a non-cash transaction on the Company’s consolidated balance sheets. Transition and Separation Agreement On May 3, 2019, the Company entered into a Transition and Separation Agreement (the “Separation Agreement”) with its former Chief Executive Officer (the “former CEO”). Under the Separation Agreement, the former CEO and the Company agreed to a general release of claims and his compliance with the restrictive covenants. The Company recorded an expense of $0.3 million for the three months ended March 31, 2020 within other expense in the consolidated statements of operations relating to the severance payments and benefits payable to the former CEO. Per the terms of the Separation Agreement, the former CEO’s profit interests (“P Shares”) were forfeited and outstanding RSUs are treated in accordance with the terms of the applicable award agreements. Additionally, the Company cancelled 137,987 shares of common stock in July 2019, with no consideration as per the terms of the Separation Agreement. On January 23, 2020, the Company and the former CEO entered into an amendment to the Separation Agreement, which, among other things, provides that effective as of February 1, 2020, the former CEO resigned from his position as Executive Chairman of the Company and its subsidiaries.

Insurance Operations

Insurance Operations	3 Months Ended
	Mar. 31, 2020
Insurance Operations
Insurance Operations	9. Insurance Operations Total reinsurance ceded and assumed relating to premiums written, earned premiums and losses and loss adjustment expenses incurred, are as follows: Three Months Ended March 31 ($ in thousands) 2020 2019 Written premiums Direct written premiums $ 212,951 $ 254,985 Assumed from other companies 833 853 Ceded to other companies 23,601 45,936 Net written premiums $ 190,183 $ 209,902 Earned premiums Direct earned premiums $ 228,580 $ 223,002 Assumed from other companies 742 942 Ceded to other companies 23,660 28,336 Net earned premiums $ 205,662 $ 195,608 Percent of amount assumed to net Losses and loss adjustment expenses incurred Direct net losses and loss adjustment expenses incurred $ 144,377 $ 135,348 Assumed from other companies (1,357) 2,819 Ceded to other companies 15,463 19,834 Net losses and loss adjustment expenses incurred $ 127,557 $ 118,333 In 2017, the Company ceded significant amounts of premium under the whole account quota share reinsurance agreements (“WAQS”). In 2018, the WAQS were terminated. To the extent of unearned premium at the time of termination, ceded written premiums, net of the ceding commission, was returned. In January 2020, the WAQS were commuted at no gain or loss to the Company. Allowances for Credit Losses The following table is rollforward of the receivable allowance balances related to the risk of credit default as of March 31, 2020: ($ in thousands) Beginning Balance Current Provision Write-offs Recoveries Ending Balance Premium receivable $ 5,056 $ 1,076 $ (130) $ 54 $ 6,056 Reinsurance receivable on paid and unpaid losses 505 52 — — 557 Total receivable allowance $ 5,561 $ 1,128 $ (130) $ 54 $ 6,613 The allowance for credit loss for premium receivable is an assessment of ultimate non-collectability based on historical experience applicable to the respective current collection action status, age of the amount outstanding and expected collection costs. The majority of the allowance relates to audit premium on workers’ compensation coverages assessed during or after the period of coverage whereby there is limited ability to cancel or limit coverage. In the final collection action at the insured level, collection agencies are typically engaged. The amount currently with collection agencies is $5.2 million. The reinsurance receivable allowance for credit loss is based on sources of credit ratings of reinsurers and applies probabilities of default and loss given default to the total uncollateralized exposure including incurred but not reported (“IBNR”) by rating class. The amount of uncollateralized exposure on unrated or counterparties rated below investment grade at March 31, 2020 is $2.8 million. At March 31, 2020, 97.6% of uncollateralized exposures are rated above investment grade. Distribution Partners The three distribution partners contributing the largest amounts of direct written premium (excluding the distribution partner below) totaled $69.1 million and $50.2 million for the three months ended March 31, 2020 and 2019, respectively. The Company negotiates with distribution partners to write direct premium on behalf of the Company’s affiliates. In January 2019, a distribution partner of the Company was acquired by a third-party insurance carrier. The Company does not anticipate any future premiums from this distribution partner other than audit premiums after the first quarter of 2019. Unpaid Losses Unpaid losses are based on individual case estimates for losses reported and include a provision for IBNR losses and loss adjustment expenses. The following table provides a roll forward of the Company’s reserve for unpaid losses and loss adjustment expenses: March 31 ($ in thousands) 2020 2019 Gross reserve for unpaid losses and loss expenses, at beginning of year $ 1,521,648 $ 1,396,812 Ceded reserve for unpaid losses and loss expenses, at beginning of year 193,952 185,295 Net reserve for unpaid losses and loss expenses, at beginning of year 1,327,696 1,211,517 Add: Incurred losses and loss expenses occurring in the: Current year 121,001 118,728 Prior years 198 (395) Prior years attributable to adjusted premium 6,358 — Total net losses and loss adjustment expenses incurred 127,557 118,333 Less: Paid losses and loss expenses for claims occurring in the: Current year 3,665 3,528 Prior years 62,655 78,676 Total paid losses and loss expenses for claims 66,320 82,204 Net reserve for unpaid losses and loss expenses, at end of period 1,388,933 1,247,646 Ceded reserve for unpaid losses and loss expenses, at end of period 156,866 201,889 Gross reserve for unpaid losses and loss expenses, at end of period $ 1,545,799 $ 1,449,535 During the three months ended March 31, 2020, the Company’s reserve for unpaid losses and loss adjustment expenses for accident years 2019 and prior developed unfavorably by $0.2 million driven by $7.1 million unfavorable development of Commercial Multiple Peril and $4.4 million unfavorable development in General Liability offset by $5.2 million favorable development in Commercial Auto, $4.9 million in Workers’ Compensation and $1.3 million in All Other lines. In addition, the Company incurred $6.4 million of losses and loss adjustment expenses related to premium adjustments earned during the three months ended March 31, 2020 attributable to prior accident years 2019 and 2018. The unfavorable development in Commercial Multiple Peril and General Liability related to 2013 through 2017 accident years due largely to increased severities in the runoff components within the Other customer segment. The favorable development in Workers’ Compensation derived from lower than expected claims severity across all customer segments primarily in accident years 2013 through 2015 and 2017. The favorable development in Commercial Auto was driven by physical damage and liability bodily injury in accident years 2017 through 2019. The favorable development in All Other lines was in Surety and Ocean Marine lines of business. There were no significant drivers of favorable development of $0.4 for the three months ended March 31, 2019.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2020
Income Taxes
Income Taxes	10. Income Taxes The Company is subject to the tax laws and regulations of the United States and various state jurisdictions. The Company files a consolidated federal tax return. The Company has one non-U.S. subsidiary, ProSight Specialty Bermuda Limited (“PSBL”), which has received an undertaking from the Minister of Finance in Bermuda that would exempt such company from Bermudian taxation until March 2035. In 2019, PSBL became a direct subsidiary of the Company and is subject to U.S. tax on its income. The Company uses the estimated annual effective tax rate method for calculating its tax provision in interim periods, which represents the Company’s best estimate of the effective tax rate expected for the full year. The estimated annual effective tax rate typically differs from the U.S. statutory tax rate primarily as a result of discrete items recognized during the period. The Company’s effective tax rates were 22.6% and 21.8% for the three months ended March 31, 2020 and 2019, respectively. The increase in the effective tax rate in the three months ended March 31, 2020 compared to the same period in 2019 was primarily due to the tax effect of share-based compensation. On March 27, 2020, the President of the United States signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The CARES Act, among other things, includes certain income tax provisions for individuals and corporations; however, these benefits do not impact the Company ’s current tax provision.

Segment Information

Segment Information	3 Months Ended
	Mar. 31, 2020
Segment Information
Segment Information	11. Segment Information The Company has one reportable segment, Specialty Insurance segment, which primarily offers property and casualty insurance products through its customers segments that include Construction, Consumer Services, Marine and Energy, Media and Entertainment, Professional Services, Real Estate, Sports, and Transportation. The primary criteria to determine the Company’s reportable segment is based on the fact that the Company’s senior management reviews, assesses and allocates resources both on a financial and personnel basis on an entity-wide level. The following table provides a summary of the Company’s gross written premiums by customer segments within our Specialty Insurance segment. “Other” includes gross written premiums from; (i) primary and excess workers’ compensation coverage for exited Self-Insured Groups, (ii) niches exited prior to 2018, many with a concentration in commercial auto , (iii) certain fronting arrangements in which all premium written is ceded to a third party (iv) participation in industry pools, and (v) emerging new business . Three Months Ended March 31 ($ in thousands) 2020 2019 Customer Segment Construction $ 24,514 % $ 23,248 % Consumer Services 30,568 27,485 Marine and Energy 32,790 19,812 Media and Entertainment 30,467 29,692 Professional Services 29,698 29,562 Real Estate 33,215 28,735 Sports 9,565 7,850 Transportation 21,467 30,757 Customer segment subtotal 212,284 197,141 Other 1,500 58,697 Specialty Insurance total $ 213,784 % $ 255,838 % The following table provides a summary of the Company’s gross written premiums by line of business within our Specialty Insurance segment: Three Months Ended March 31 ($ in thousands) 2020 2019 Line of Business Commercial Auto $ 40,331 % $ 41,784 % General Liability 78,533 71,295 Workers’ Compensation 28,821 90,062 Commercial Multiple Peril 16,365 19,634 All Other Lines 49,734 33,063 Specialty Insurance total $ 213,784 % $ 255,838 %

Earnings Per Share

Earnings Per Share	3 Months Ended
	Mar. 31, 2020
Earnings Per Share
Earnings Per Share	12. Earnings per Share The following table provides a reconciliation of the numerators and denominators of basic and diluted earnings per share (“EPS”): Continuing Operations Discontinued Operations (in thousands, except per share amounts) Income Shares Per Share Income Shares Per Share Three Months Ended March 31, 2020 (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic EPS: Net income available to common stockholders $ 6,811 43,910 $ 0.16 $ 257 43,910 $ — Effect of dilutive securities: Stock compensation plans 364 364 Diluted EPS $ 6,811 44,274 $ 0.15 $ 257 44,274 $ 0.01 Continuing Operations Discontinued Operations (in thousands, except per share amounts) Income Shares Per Share Loss Shares Per Share Three Months Ended March 31, 2019 (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic EPS: Net income (loss) available to common stockholders $ 13,695 38,851 $ 0.35 $ (255) 38,851 $ — Effect of dilutive securities: Stock compensation plans 604 604 Diluted EPS $ 13,695 39,455 $ 0.35 $ (255) 39,455 $ (0.01)

Share-Based Compensation

Share-Based Compensation	3 Months Ended
	Mar. 31, 2020
Share-Based Compensation
Share-Based Compensation	13. Share-Based Compensation On July 24, 2019, the Company’s 2019 Equity Incentive Plan (the “2019 Plan”) became effective immediately prior to the effectiveness of the registration statement filed in connection with the IPO. The 2019 Plan provides for the grant of stock options, stock appreciation rights, restricted shares, RSUs, dividend equivalent rights, performance-based shares or other equity‑based or equity-related awards. The 2019 Plan is administered by the compensation committee of the Company’s Board of Directors. Subject to the provisions of the 2019 Plan, the compensation committee determines in its discretion, the persons to whom and the times at which awards are granted, the size of awards (subject to certain limitations set forth in the compensation committee charter) and the terms and conditions of awards. A total of 4,500,000 shares of common stock are initially authorized and reserved for issuance under the 2019 Plan, including shares underlying RSUs granted under the Company’s Amended and Restated 2010 Equity Incentive Plan. The following table summarizes the stock-based compensation transactions for the 2019 Plan for the three months ended March 31, 2020: Number of Weighted Average Grant Date Shares Fair Value Per Share Unvested at December 31, 2019 1,289,396 $ 14.00 Granted 458,515 $ 13.40 Vested (179) $ 14.00 Forfeited (5,358) $ 14.00 Unvested at March 31, 2020 1,742,374 $ 13.84 As of March 31, 2020, The Company had approximately $18.8 million of total unrecognized stock-based compensation expense expected to be recognized over a weighted-average period of 2.4 years.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2020
Commitments and Contingencies
Commitments and Contingencies	14. Commitments and Contingencies Leases The Company determines if an arrangement is a lease on the commencement date of the contract. The right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. The right-of-use assets and lease liabilities are measured by the present value of the future minimum lease payments over the lease term. The Company uses the rate implicit in the lease whenever that rate is readily determinable. If the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate. The right-of-use asset is then adjusted to exclude lease incentives. Certain leases may contain rental escalation, renewal options and/or termination options that are factored into our determination of lease payments when appropriate. Variable lease payment amounts that cannot be determined at the commencement of the lease are not included in the right-to-use assets or lease liabilities. L eases covering a period of fewer than 12 months are not recorded on the Company’s consolidated balance sheets. Rent expense is calculated using the straight-line method. The Company leases certain facilities and equipment under non-cancelable lease agreements that expire at various dates through 2025, which are generally renewed or replaced by similar leases. The lease agreements do not contain any material restrictive covenants, do not contain any conditions of residual value guarantees and are substantially all considered to be operating leases. The Company’s leases relate to office facilities in New Jersey, New York, California, Florida, Georgia and the U.K. The weighted average lease term was 2.9 years and the weighted average discount rate was 2.0%. Rent expense for the three months ended March 31, 2020 was $0.8 million. The following table presents the Company’s lease liabilities and right-of-use assets related to operating leases as of March 31, 2020: ($ in thousands) March 31, 2020 One year or less $ 3,188 More than one year to two years 2,449 More than two years to three years — More than three years to four years — More than four years to five years — More than five years — Total undiscounted future minimum lease payments 5,637 Less: difference between lease payments and discounted lease liabilities 104 Lease liabilities $ 5,533 Right-of-use assets $ 4,810 Prepaid lease assets, net of lease allowances and incentives 723 Total $ 5,533 The right-of-use assets are reported as a component of other assets and the lease liabilities are reported as a component of other liabilities on the Company’s consolidated balance sheets. Coronavirus Disease 2019 Impact The World Health Organization declared the coronavirus disease 2019 (“COVID-19”) outbreak a pandemic on March 11, 2020. The COVID-19 outbreak has caused an economic downturn on a global scale, including temporary closures of many businesses and reduced consumer spending due to aggressive shelter-in-place measures implemented by state governments, as well as significant market disruption and volatility. The magnitude and duration of the COVID-19 pandemic and the impact of actions taken by governmental authorities, businesses and consumers to mitigate its effects create significant uncertainty. The Company continues to actively monitor the impact of COVID-19 as it continues to unfold and cannot, at this time, predict the impact the pandemic will have on its future consolidated financial position, cash flows or results of operations, however the impact could be material. See Item 1A. Risk Factors for additional information.

Legal Proceedings

Legal Proceedings	3 Months Ended
	Mar. 31, 2020
Legal Proceedings
Legal Proceedings	15. Legal Proceedings In the normal course of business, the Company’s insurance subsidiaries are subject to disputes, including litigation and arbitration, arising out of the ordinary course of business. The Company’s estimates of the costs of settling such matters are reflected in its reserves for losses and loss expenses, and the Company does not believe that the ultimate outcome of such matters will have a material adverse effect on its financial condition or results of operations.

Basis of Reporting (Policies)

Basis of Reporting (Policies)	3 Months Ended
	Mar. 31, 2020
Basis of Reporting
Use of Estimates	Use of Estimates The preparation of the unaudited interim consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the financial statement balances, as well as disclosure of contingent assets and liabilities. Actual results could differ from those estimates. Management periodically reviews its estimates and assumptions.

Supplemental Cash Flow (Tables)

Supplemental Cash Flow (Tables)	3 Months Ended
	Mar. 31, 2020
Supplemental Cash Flow
Summary of supplemental cash flow information	Three Months Ended March 31 ($ in thousands) 2020 2019 Non-cash activity: Operating lease right-of-use assets due to adoption of ASU 2016-02 - continuing operations $ 4,810 $ — Operating lease right-of-use assets due to adoption of ASU 2016-02 - discontinued operations $ 2,287 $ — Operating lease liabilities due to adoption of ASU 2016-02 - continuing operations $ 5,533 $ — Operating lease liabilities due to adoption of ASU 2016-02 - discontinued operations $ 2,665 $ —

Discontinued Operations (Tables

Discontinued Operations (Tables)	3 Months Ended
	Mar. 31, 2020
Discontinued Operations
Summary of results of operations and carrying amounts of assets and liabilities for discontinued operations	March 31, December 31, ($ in thousands) 2020 2019 Assets Cash and investments $ 10,080 $ 10,428 Other assets 13,262 11,156 Total assets $ 23,342 $ 21,584 Liabilities Reserve for unpaid losses and loss adjustment expenses $ 24,149 $ 24,169 Other liabilities 9,609 7,409 Total liabilities $ 33,758 $ 31,578

Investments (Tables)

Investments (Tables)	3 Months Ended
	Mar. 31, 2020
Investments
Summary of gross unrealized gains and losses on fixed maturity securities included in assets	(a) The gross unrealized gains and losses on fixed maturity securities included in assets from continuing operations at March 31, 2020, are as follows: Cost/ Gross Gross Amortized Credit Loss Unrealized Unrealized Fair ($ in thousands) Cost Allowance Gains Losses Value Fixed maturity securities: U.S. Treasury securities $ 40,679 $ — $ 2,643 $ — $ 43,322 Government agency securities 27,998 — 591 — 28,589 Corporate debt securities 1,317,091 (293) 22,167 (37,278) 1,301,687 Municipal debt obligations 103,271 — 813 (3,443) 100,641 ABS 49,205 (1) 26 (3,210) 46,020 CLO 177,411 (6) — (19,842) 157,563 CMBS 94,816 — 1,603 (1,945) 94,474 RMBS - non-agency 92,189 (116) 3,411 (4,851) 90,633 RMBS - agency 135,809 — 3,738 (56) 139,491 Total fixed maturity securities $ 2,038,469 $ (416) $ 34,992 $ (70,625) $ 2,002,420 The gross unrealized gains and losses on fixed maturity securities included in assets from continuing operations at December 31, 2019, are as follows: Cost/ Gross Gross Amortized Unrealized Unrealized Fair ($ in thousands) Cost Gains Losses Value Fixed maturity securities: U.S. Treasury securities $ 49,161 $ 838 $ (14) $ 49,985 Government agency securities 6,522 23 (14) 6,531 Corporate debt securities 1,308,094 33,743 (3,025) 1,338,812 Municipal debt obligations 80,338 243 (766) 79,815 ABS 73,068 854 (340) 73,582 CLO 181,704 125 (2,280) 179,549 CMBS 95,810 1,863 (147) 97,526 RMBS - non-agency 62,343 9,458 (191) 71,610 RMBS - agency 142,363 1,256 (347) 143,272 Total fixed maturity securities $ 1,999,403 $ 48,403 $ (7,124) $ 2,040,682
Summary of all securities in an unrealized loss position, the fair value and gross unrealized loss by asset class and by length of time those securities have been in a loss position	(b) The following table summarizes the fair values and gross unrealized losses for fixed maturity securities in an unrealized loss position at March 31, 2020, grouped by asset class and by duration of time in a continuous unrealized loss position: Less Than 12 Months Greater Than 12 Months Total Total Fair Unrealized Fair Unrealized Total Unrealized ($ in thousands) Value Losses Value Losses Fair Value Losses Corporate debt securities $ 495,656 $ (31,005) $ 83,577 $ (6,273) $ 579,233 $ (37,278) Municipal debt obligations 66,579 (3,278) 5,584 (165) 72,163 (3,443) ABS 33,474 (2,604) 8,425 (606) 41,899 (3,210) CLO 59,491 (5,053) 98,072 (14,789) 157,563 (19,842) CMBS 26,478 (1,935) 3,031 (10) 29,509 (1,945) RMBS - non-agency 45,431 (3,042) 12,115 (1,809) 57,546 (4,851) RMBS - agency 6,585 (55) 1 (1) 6,586 (56) Total fixed maturity securities $ 733,694 $ (46,972) $ 210,805 $ (23,653) $ 944,499 $ (70,625) The following table summarizes the fair values and gross unrealized losses for fixed maturity securities in an unrealized loss position at December 31, 2019, grouped by asset class and by duration of time in a continuous unrealized loss position: Less Than 12 Months Greater Than 12 Months Total Total Fair Unrealized Fair Unrealized Total Unrealized ($ in thousands) Value Losses Value Losses Fair Value Losses U.S. Treasury securities $ — $ — $ 7,469 $ (14) $ 7,469 $ (14) Government agency securities 3,192 (14) — — 3,192 (14) Corporate debt securities 133,341 (2,509) 50,695 (516) 184,036 (3,025) Municipal debt obligations 66,355 (766) — — 66,355 (766) ABS 27,884 (175) 11,165 (165) 39,049 (340) CLO 28,485 (338) 110,825 (1,942) 139,310 (2,280) CMBS 18,307 (102) 6,053 (45) 24,360 (147) RMBS - non-agency 2,173 (14) 2,418 (177) 4,591 (191) RMBS - agency 10,450 (12) 12,367 (335) 22,817 (347) Total fixed maturity securities $ 290,187 $ (3,930) $ 200,992 $ (3,194) $ 491,179 $ (7,124)
Rollforward of the credit losses allowance for fixed maturity securities	Beginning Additions Reduction Reduction Change in Securities Ending ($ in thousands) Balance New Securities Sales Intent to Sell with Previous Allowance Balance Fixed maturity securities: Corporate debt securities $ — $ 293 $ — $ — $ — $ 293 ABS — 1 — — — 1 CLO — 6 — — — 6 RMBS - non-agency — 116 — — — 116 Total fixed maturity securities allowance $ — $ 416 $ — $ — $ — $ 416
Summary of amortized cost and fair value of fixed maturity securities	March 31, 2020 Amortized Fair ($ in thousands) Cost Value Due in one year or less $ 103,407 $ 103,498 Due after one through five years 659,203 657,184 Due after five through ten years 449,535 445,004 Due after ten years 248,896 239,964 1,461,041 1,445,650 Structured securities: Government agency securities 27,998 28,589 ABS 49,205 46,020 CLO 177,411 157,563 CMBS 94,816 94,474 RMBS - non-agency 92,189 90,633 RMBS - agency 135,809 139,491 Total fixed maturity securities $ 2,038,469 $ 2,002,420
Summary of net investment income included in net income from continuing operations	Three Months Ended March 31 ($ in thousands) 2020 2019 Fixed maturity securities $ 16,282 $ 16,119 Commercial levered loans 95 219 Net limited partnerships (losses) gains (6,877) 1,251 Other (10) 89 Gross investment income 9,490 17,678 Less: investment income attributable to funds withheld liabilities 136 142 Less: expenses 539 378 Net investment income $ 8,815 $ 17,158

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	3 Months Ended
	Mar. 31, 2020
Fair Value Measurements
Summary of major categories of assets measured at fair value on a recurring basis	March 31, 2020 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities: U.S. Treasury securities $ — $ 43,322 $ — $ 43,322 Government agency securities — 28,589 — 28,589 Corporate debt securities — 1,149,269 152,418 1,301,687 Municipal debt obligations — 100,641 — 100,641 ABS — 46,020 — 46,020 CLO — 157,563 — 157,563 CMBS — 94,474 — 94,474 RMBS - non agency — 90,633 — 90,633 RMBS - agency — 139,491 — 139,491 Total fixed maturity securities — 1,850,002 152,418 2,002,420 Non-redeemable preferred stock securities — 11,378 — 11,378 Total investments measured at fair value $ — $ 1,861,380 $ 152,418 2,013,798 Investments measured at net asset value: Limited partnerships and limited liability companies 65,011 Total assets at fair value $ 2,078,809 December 31, 2019 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities: U.S. Treasury securities $ — $ 49,985 $ — $ 49,985 Government agency securities — 6,531 — 6,531 Corporate debt securities — 1,189,181 149,631 1,338,812 Municipal debt obligations — 79,815 — 79,815 ABS — 73,582 — 73,582 CLO — 179,549 — 179,549 CMBS — 97,526 — 97,526 RMBS - non agency — 71,610 — 71,610 RMBS - agency — 143,272 — 143,272 Total investments measured at fair value $ — $ 1,891,051 $ 149,631 2,040,682 Investments measured at net asset value: Limited partnerships and limited liability companies 66,660 Total assets at fair value $ 2,107,342
Summary of carrying value and fair value of financial instruments that are not recognized or are not carried at fair value	March 31, 2020 Carrying Fair Value ($ in thousands) Value Total Level 1 Level 2 Level 3 Assets Commercial levered loans $ 13,725 $ 12,246 $ — $ — $ 12,246 Liabilities Notes payable $ 165,000 $ 166,288 $ — $ 166,288 $ — Unamortized debt issuance costs (222) Notes payable, net of debt issuance costs $ 164,778 December 31, 2019 Carrying Fair Value ($ in thousands) Value Total Level 1 Level 2 Level 3 Assets Commercial levered loans $ 14,069 $ 13,950 $ — $ — $ 13,950 Liabilities Notes payable $ 165,000 $ 167,507 $ — $ 167,507 $ — Unamortized debt issuance costs (307) Notes payable, net of debt issuance costs $ 164,693
Summary of the changes in the fair value of securities measured using Level 3 inputs	Level 3 Corporate Debt ($ in thousands) Securities Fair value, December 31, 2019 $ 149,631 Total net (losses) gains for the period included in: Other comprehensive loss (10,703) Net realized gain 1 Purchases 14,241 Sales — Issuances — Settlements (752) Transfers into Level 3 — Transfers out of Level 3 — Fair value, March 31, 2020 $ 152,418 Level 3 Corporate Debt ($ in thousands) Securities Fair value, December 31, 2018 $ 126,497 Total net losses for the period included in: Other comprehensive loss (1,273) Net realized loss (40) Purchases 2,329 Sales — Issuances — Settlements (1,373) Transfers into Level 3 — Transfers out of Level 3 — Fair value, March 31, 2019 $ 126,140

Accumulated Other Comprehensi_2

Accumulated Other Comprehensive (Loss) Income (Tables)	3 Months Ended
	Mar. 31, 2020
Accumulated Other Comprehensive (Loss) Income [Abstract]
Summary of the components of accumulated other comprehensive (loss) income	($ in thousands) Gross Tax Net December 31, 2019 $ 46,123 $ 8,670 $ 37,453 Unrealized holding losses on fixed maturity securities (77,066) (16,102) (60,964) Amounts reclassified into net income 942 136 806 Amounts reclassified as credit losses (416) (87) (329) Other comprehensive loss (77,592) (16,151) (61,441) March 31, 2020 $ (31,469) $ (7,481) $ (23,988) ($ in thousands) Gross Tax Net December 31, 2018 $ (29,760) $ (7,445) $ (22,315) Unrealized holding gains on fixed maturity securities 34,803 7,241 27,562 Amounts reclassified into net income (214) (24) (190) Other comprehensive income 35,017 7,265 27,752 March 31, 2019 $ 5,257 $ (180) $ 5,437
Summary of reclassifications out of accumulated other comprehensive (loss) income	Line in Consolidated Three Months Ended March 31 ($ in thousands) Statements of Operations 2020 2019 AOCI Unrealized gains (losses) on securities Realized investment gains, net $ 942 $ (214) Income tax expense 136 (24) Reclassification adjustment for credit losses included in net income Realized investment losses, net (416) — Income tax expense (87) — Total reclassifications $ 477 $ (190)

Insurance Operations (Tables)

Insurance Operations (Tables)	3 Months Ended
	Mar. 31, 2020
Insurance Operations
Summary of reinsurance ceded and assumed relating to premiums written, earned premiums and losses and loss adjustment expenses	Three Months Ended March 31 ($ in thousands) 2020 2019 Written premiums Direct written premiums $ 212,951 $ 254,985 Assumed from other companies 833 853 Ceded to other companies 23,601 45,936 Net written premiums $ 190,183 $ 209,902 Earned premiums Direct earned premiums $ 228,580 $ 223,002 Assumed from other companies 742 942 Ceded to other companies 23,660 28,336 Net earned premiums $ 205,662 $ 195,608 Percent of amount assumed to net Losses and loss adjustment expenses incurred Direct net losses and loss adjustment expenses incurred $ 144,377 $ 135,348 Assumed from other companies (1,357) 2,819 Ceded to other companies 15,463 19,834 Net losses and loss adjustment expenses incurred $ 127,557 $ 118,333
Premium receivable allowance rollforward	($ in thousands) Beginning Balance Current Provision Write-offs Recoveries Ending Balance Premium receivable $ 5,056 $ 1,076 $ (130) $ 54 $ 6,056 Reinsurance receivable on paid and unpaid losses 505 52 — — 557 Total receivable allowance $ 5,561 $ 1,128 $ (130) $ 54 $ 6,613
Summary of unpaid losses	March 31 ($ in thousands) 2020 2019 Gross reserve for unpaid losses and loss expenses, at beginning of year $ 1,521,648 $ 1,396,812 Ceded reserve for unpaid losses and loss expenses, at beginning of year 193,952 185,295 Net reserve for unpaid losses and loss expenses, at beginning of year 1,327,696 1,211,517 Add: Incurred losses and loss expenses occurring in the: Current year 121,001 118,728 Prior years 198 (395) Prior years attributable to adjusted premium 6,358 — Total net losses and loss adjustment expenses incurred 127,557 118,333 Less: Paid losses and loss expenses for claims occurring in the: Current year 3,665 3,528 Prior years 62,655 78,676 Total paid losses and loss expenses for claims 66,320 82,204 Net reserve for unpaid losses and loss expenses, at end of period 1,388,933 1,247,646 Ceded reserve for unpaid losses and loss expenses, at end of period 156,866 201,889 Gross reserve for unpaid losses and loss expenses, at end of period $ 1,545,799 $ 1,449,535

Segment Information (Tables)

Segment Information (Tables)	3 Months Ended
	Mar. 31, 2020
Segment Information
Summary of gross written premiums by customer segments	Three Months Ended March 31 ($ in thousands) 2020 2019 Customer Segment Construction $ 24,514 % $ 23,248 % Consumer Services 30,568 27,485 Marine and Energy 32,790 19,812 Media and Entertainment 30,467 29,692 Professional Services 29,698 29,562 Real Estate 33,215 28,735 Sports 9,565 7,850 Transportation 21,467 30,757 Customer segment subtotal 212,284 197,141 Other 1,500 58,697 Specialty Insurance total $ 213,784 % $ 255,838 %
Summary of gross written premiums by line of business across customer segments	Three Months Ended March 31 ($ in thousands) 2020 2019 Line of Business Commercial Auto $ 40,331 % $ 41,784 % General Liability 78,533 71,295 Workers’ Compensation 28,821 90,062 Commercial Multiple Peril 16,365 19,634 All Other Lines 49,734 33,063 Specialty Insurance total $ 213,784 % $ 255,838 %

Earnings Per Share (Tables)

Earnings Per Share (Tables)	3 Months Ended
	Mar. 31, 2020
Earnings Per Share
Summary of reconciliation of the numerators and denominators of basic and diluted EPS	Continuing Operations Discontinued Operations (in thousands, except per share amounts) Income Shares Per Share Income Shares Per Share Three Months Ended March 31, 2020 (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic EPS: Net income available to common stockholders $ 6,811 43,910 $ 0.16 $ 257 43,910 $ — Effect of dilutive securities: Stock compensation plans 364 364 Diluted EPS $ 6,811 44,274 $ 0.15 $ 257 44,274 $ 0.01 Continuing Operations Discontinued Operations (in thousands, except per share amounts) Income Shares Per Share Loss Shares Per Share Three Months Ended March 31, 2019 (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic EPS: Net income (loss) available to common stockholders $ 13,695 38,851 $ 0.35 $ (255) 38,851 $ — Effect of dilutive securities: Stock compensation plans 604 604 Diluted EPS $ 13,695 39,455 $ 0.35 $ (255) 39,455 $ (0.01)

Share-Based Compensation (Table

Share-Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2020
Share-Based Compensation
Schedule of stock-based compensation transactions	Number of Weighted Average Grant Date Shares Fair Value Per Share Unvested at December 31, 2019 1,289,396 $ 14.00 Granted 458,515 $ 13.40 Vested (179) $ 14.00 Forfeited (5,358) $ 14.00 Unvested at March 31, 2020 1,742,374 $ 13.84

Commitments and Contingencies (

Commitments and Contingencies (Tables)	3 Months Ended
	Mar. 31, 2020
Commitments and Contingencies
Schedule of lease liabilities and right-of-use lease assets	($ in thousands) March 31, 2020 One year or less $ 3,188 More than one year to two years 2,449 More than two years to three years — More than three years to four years — More than four years to five years — More than five years — Total undiscounted future minimum lease payments 5,637 Less: difference between lease payments and discounted lease liabilities 104 Lease liabilities $ 5,533 Right-of-use assets $ 4,810 Prepaid lease assets, net of lease allowances and incentives 723 Total $ 5,533

Basis of Reporting (Details)

Basis of Reporting (Details)	Jul. 25, 2019
Basis of Reporting
Conversion ratio of PGHL shares to Company shares	6.46

Recently Adopted Accounting S_2

Recently Adopted Accounting Standards (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Jan. 01, 2020
Recently adopted accounting standards
Operating lease right-of-use asset, continuing operations	$ 5,533
Operating lease liability, continuing operations	$ 5,533
ASU 2016-02
Recently adopted accounting standards
Operating lease right-of-use asset, continuing operations		$ 5,600
Operating lease liability, continuing operations		6,300
Operating lease right-of-use asset, discontinued operations		2,500
Operating lease liability, discontinued operations		$ 3,000

Supplemental Cash Flow (Details

Supplemental Cash Flow (Details)	1 Months Ended
	Mar. 31, 2020shares
Supplemental cash flow information
Shares withheld to settle tax withholding on vested RSUs	154,629
Net shares issued upon settlement of vested RSUs	284,133

Supplemental Cash Flow - Summar

Supplemental Cash Flow - Summary of supplemental cash flow information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020USD ($)
Supplemental Cash Flow
Operating lease right-of-use assets due to adoption of ASU 2016-02 - continuing operations	$ 4,810
Operating lease right-of-use assets due to adoption of ASU 2016-02 - discontinued operations	2,287
Operating lease liabilities due to adoption of ASU 2016-02 - continuing operations	5,533
Operating lease liabilities due to adoption of ASU 2016-02 - discontinued operations	$ 2,665

Discontinued Operations - Conso

Discontinued Operations - Consolidated Balance Sheets (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Net income (loss)
Net income (loss) from discontinued operations	$ 257	$ (255)
Assets
Total assets	23,342		$ 21,584
Liabilities
Total liabilities	33,758		31,578
Insurance Operations, U.K. | Discontinued operation
Net income (loss)
Net income (loss) from discontinued operations	300	$ (300)
Assets
Cash and investments	10,080		10,428
Other assets	13,262		11,156
Total assets	23,342		21,584
Liabilities
Reserve for unpaid losses and loss adjustment expenses	24,149		24,169
Other liabilities	9,609		7,409
Total liabilities	$ 33,758		$ 31,578

Investments - Gross Unrealized

Investments - Gross Unrealized Gains and Losses on AFS Securities (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	$ 2,038,469	$ 1,999,403
Credit Loss Allowance	(400)
Fair Value	2,002,420	2,040,682
Short-term Investments	19,229	43,873
Commercial levered loans (amortized cost)	13,725	14,069
Limited partnerships and limited liability companies (fair value)	65,011	66,660
Total investments	2,111,763	2,165,284
Fixed maturity securities
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	2,038,469	1,999,403
Credit Loss Allowance	(416)
Gross Unrealized Gains	34,992	48,403
Gross Unrealized Losses	(70,625)	(7,124)
Fair Value	2,002,420	2,040,682
Fixed maturity securities | U.S. Treasury securities
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	40,679	49,161
Gross Unrealized Gains	2,643	838
Gross Unrealized Losses		(14)
Fair Value	43,322	49,985
Fixed maturity securities | Government agency securities
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	27,998	6,522
Gross Unrealized Gains	591	23
Gross Unrealized Losses		(14)
Fair Value	28,589	6,531
Fixed maturity securities | Corporate debt securities
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	1,317,091	1,308,094
Credit Loss Allowance	(293)
Gross Unrealized Gains	22,167	33,743
Gross Unrealized Losses	(37,278)	(3,025)
Fair Value	1,301,687	1,338,812
Fixed maturity securities | Municipal debt obligations
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	103,271	80,338
Gross Unrealized Gains	813	243
Gross Unrealized Losses	(3,443)	(766)
Fair Value	100,641	79,815
Fixed maturity securities | ABS
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	49,205	73,068
Credit Loss Allowance	(1)
Gross Unrealized Gains	26	854
Gross Unrealized Losses	(3,210)	(340)
Fair Value	46,020	73,582
Fixed maturity securities | CLO
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	177,411	181,704
Credit Loss Allowance	(6)
Gross Unrealized Gains		125
Gross Unrealized Losses	(19,842)	(2,280)
Fair Value	157,563	179,549
Fixed maturity securities | CMBS
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	94,816	95,810
Gross Unrealized Gains	1,603	1,863
Gross Unrealized Losses	(1,945)	(147)
Fair Value	94,474	97,526
Fixed maturity securities | RMBS - non-agency
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	92,189	62,343
Credit Loss Allowance	(116)
Gross Unrealized Gains	3,411	9,458
Gross Unrealized Losses	(4,851)	(191)
Fair Value	90,633	71,610
Fixed maturity securities | RMBS - agency
Gross unrealized gains and losses on fixed maturity securities included in assets
Fixed maturity securities, available-for-sale, amortized cost	135,809	142,363
Gross Unrealized Gains	3,738	1,256
Gross Unrealized Losses	(56)	(347)
Fair Value	$ 139,491	$ 143,272

Investments - Unrealized Loss P

Investments - Unrealized Loss Position (Details) $ in Thousands	Mar. 31, 2020USD ($)security	Dec. 31, 2019USD ($)security
Unrealized Losses
Fixed maturity securities, unrealized loss position | security	500	313
Credit loss allowance for fixed maturity securities	$ 400
Fixed maturity securities
Fair Value
Less Than 12 Months	733,694	$ 290,187
Greater Than 12 Months	210,805	200,992
Total Fair Value	944,499	491,179
Unrealized Losses
Less Than 12 Months	(46,972)	(3,930)
Greater Than 12 Months	(23,653)	(3,194)
Total Unrealized Losses	(70,625)	(7,124)
Credit loss allowance for fixed maturity securities	416
Fixed maturity securities | U.S. Treasury securities
Fair Value
Greater Than 12 Months		7,469
Total Fair Value		7,469
Unrealized Losses
Greater Than 12 Months		(14)
Total Unrealized Losses		(14)
Fixed maturity securities | Government agency securities
Fair Value
Less Than 12 Months		3,192
Total Fair Value		3,192
Unrealized Losses
Less Than 12 Months		(14)
Total Unrealized Losses		(14)
Fixed maturity securities | Corporate debt securities
Fair Value
Less Than 12 Months	495,656	133,341
Greater Than 12 Months	83,577	50,695
Total Fair Value	579,233	184,036
Unrealized Losses
Less Than 12 Months	(31,005)	(2,509)
Greater Than 12 Months	(6,273)	(516)
Total Unrealized Losses	(37,278)	(3,025)
Credit loss allowance for fixed maturity securities	293
Fixed maturity securities | Municipal debt obligations
Fair Value
Less Than 12 Months	66,579	66,355
Greater Than 12 Months	5,584
Total Fair Value	72,163	66,355
Unrealized Losses
Less Than 12 Months	(3,278)	(766)
Greater Than 12 Months	(165)
Total Unrealized Losses	(3,443)	(766)
Fixed maturity securities | ABS
Fair Value
Less Than 12 Months	33,474	27,884
Greater Than 12 Months	8,425	11,165
Total Fair Value	41,899	39,049
Unrealized Losses
Less Than 12 Months	(2,604)	(175)
Greater Than 12 Months	(606)	(165)
Total Unrealized Losses	(3,210)	(340)
Credit loss allowance for fixed maturity securities	1
Fixed maturity securities | CLO
Fair Value
Less Than 12 Months	59,491	28,485
Greater Than 12 Months	98,072	110,825
Total Fair Value	157,563	139,310
Unrealized Losses
Less Than 12 Months	(5,053)	(338)
Greater Than 12 Months	(14,789)	(1,942)
Total Unrealized Losses	(19,842)	(2,280)
Credit loss allowance for fixed maturity securities	6
Fixed maturity securities | CMBS
Fair Value
Less Than 12 Months	26,478	18,307
Greater Than 12 Months	3,031	6,053
Total Fair Value	29,509	24,360
Unrealized Losses
Less Than 12 Months	(1,935)	(102)
Greater Than 12 Months	(10)	(45)
Total Unrealized Losses	(1,945)	(147)
Fixed maturity securities | RMBS - non-agency
Fair Value
Less Than 12 Months	45,431	2,173
Greater Than 12 Months	12,115	2,418
Total Fair Value	57,546	4,591
Unrealized Losses
Less Than 12 Months	(3,042)	(14)
Greater Than 12 Months	(1,809)	(177)
Total Unrealized Losses	(4,851)	(191)
Credit loss allowance for fixed maturity securities	116
Fixed maturity securities | RMBS - agency
Fair Value
Less Than 12 Months	6,585	10,450
Greater Than 12 Months	1	12,367
Total Fair Value	6,586	22,817
Unrealized Losses
Less Than 12 Months	(55)	(12)
Greater Than 12 Months	(1)	(335)
Total Unrealized Losses	$ (56)	$ (347)

Investments - Rollforward of th

Investments - Rollforward of the credit losses allowance for fixed maturity securities (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020USD ($)
Ending Balance	$ 400
Fixed maturity securities
Additions New Securities	416
Ending Balance	416
Fixed maturity securities | Corporate debt securities
Additions New Securities	293
Ending Balance	293
Fixed maturity securities | ABS
Additions New Securities	1
Ending Balance	1
Fixed maturity securities | CLO
Additions New Securities	6
Ending Balance	6
Fixed maturity securities | RMBS - non-agency
Additions New Securities	116
Ending Balance	$ 116

Investments - Amortized Cost an

Investments - Amortized Cost and Fair Value of Fixed Maturity Securities (Details) $ in Thousands	Mar. 31, 2020USD ($)
Amortized Cost
Due in one year or less	$ 103,407
Due after one through five years	659,203
Due after five through ten years	449,535
Due after ten years	248,896
Amortized Cost	1,461,041
Fair Value
Due in one year or less	103,498
Due after one through five years	657,184
Due after five through ten years	445,004
Due after ten years	239,964
Fair Value	1,445,650
Amortized Cost - Structured securities	2,038,469
Fair Value - Structured securities	2,002,420
Government agency securities
Fair Value
Amortized Cost - Structured securities	27,998
Fair Value - Structured securities	28,589
ABS
Fair Value
Amortized Cost - Structured securities	49,205
Fair Value - Structured securities	46,020
CLO
Fair Value
Amortized Cost - Structured securities	177,411
Fair Value - Structured securities	157,563
CMBS
Fair Value
Amortized Cost - Structured securities	94,816
Fair Value - Structured securities	94,474
RMBS - non-agency
Fair Value
Amortized Cost - Structured securities	92,189
Fair Value - Structured securities	90,633
RMBS - agency
Fair Value
Amortized Cost - Structured securities	135,809
Fair Value - Structured securities	$ 139,491

Investments - Limited Partnersh

Investments - Limited Partnerships and Limited Liability Company Investments (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Dec. 31, 2019
Investments
Limited partnerships and limited liability companies (fair value)	$ 65,011	$ 66,660
Threshold notice period to withdraw funds	90 days
Minimum holding period	1 year
PIMCO Tactical Opportunities Fund
Investments
Limited partnerships and limited liability companies (fair value)	$ 34,000

Investments - Gain Loss on Inve

Investments - Gain Loss on Investment (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Investments
Allowance for loan losses	$ 0		$ 0
Proceeds from sales and redemptions in AFS securities	152.8	$ 43.4
Gross realized gains from sales and redemptions in AFS securities	1	0.2
Gross realized losses from sales and redemptions of AFS investments	$ 0.4	$ 0.1

Investments - Net Investment In

Investments - Net Investment Income (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Net investment income included in net income (loss)
Gross investment income (loss)	$ 9,490	$ 17,678
Less: investment income attributable to funds withheld liabilities	136	142
Less: expenses	539	378
Net investment income	8,815	17,158
Fixed maturity securities
Net investment income included in net income (loss)
Gross investment income (loss)	16,282	16,119
Commercial levered loans
Net investment income included in net income (loss)
Gross investment income (loss)	95	219
Net limited partnerships gains
Net investment income included in net income (loss)
Gross investment income (loss)	(6,877)	1,251
Other
Net investment income included in net income (loss)
Gross investment income (loss)	$ (10)	$ 89

Investments - Other Details (De

Investments - Other Details (Details) - USD ($) $ in Millions	Mar. 31, 2020	Dec. 31, 2019
Investments
Securities required to be held with various regulatory authorities as required by law	$ 208.3	$ 210.8
Fair value of assets on deposit in collateral agreements	376.9	367.1
Carrying value of assets on deposit in collateral agreements	$ 379.5	$ 352

Investments - Summary of Unreal

Investments - Summary of Unrealized Gains (Losses) (Details) $ in Millions	3 Months Ended
	Mar. 31, 2020USD ($)
Non-redeemable preferred stock securities
Net Investment Income [Line Items]
Change in fair value recognized in income	$ 0.3

Fair Value Measurements - Asset

Fair Value Measurements - Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Major categories of assets measured at fair value on a recurring basis
Limited partnerships and limited liability companies (fair value)	$ 65,011	$ 66,660
Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	2,013,798	2,040,682
Total assets at fair value	2,078,809	2,107,342
Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	1,861,380	1,891,051
Level 3 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	152,418	149,631
Fixed maturity securities | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	2,002,420
Fixed maturity securities | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	1,850,002
Fixed maturity securities | Level 3 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	152,418
Fixed maturity securities | U.S. Treasury securities | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	43,322	49,985
Fixed maturity securities | U.S. Treasury securities | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	43,322	49,985
Fixed maturity securities | Corporate debt securities | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	1,301,687	1,338,812
Fixed maturity securities | Corporate debt securities | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	1,149,269	1,189,181
Fixed maturity securities | Corporate debt securities | Level 3 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	152,418	149,631
Fixed maturity securities | Government agency securities | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	28,589	6,531
Fixed maturity securities | Government agency securities | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	28,589	6,531
Fixed maturity securities | Municipal debt obligations | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	100,641	79,815
Fixed maturity securities | Municipal debt obligations | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	100,641	79,815
Fixed maturity securities | ABS | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	46,020	73,582
Fixed maturity securities | ABS | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	46,020	73,582
Fixed maturity securities | CLO | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	157,563	179,549
Fixed maturity securities | CLO | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	157,563	179,549
Fixed maturity securities | CMBS | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	94,474	97,526
Fixed maturity securities | CMBS | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	94,474	97,526
Fixed maturity securities | RMBS - non-agency | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	90,633	71,610
Fixed maturity securities | RMBS - non-agency | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	90,633	71,610
Fixed maturity securities | RMBS - agency | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	139,491	143,272
Fixed maturity securities | RMBS - agency | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	139,491	143,272
Non-redeemable preferred stock securities | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	11,378
Non-redeemable preferred stock securities | Level 2 | Recurring
Major categories of assets measured at fair value on a recurring basis
Total fixed maturity securities	11,378
Carrying Value | Recurring
Major categories of assets measured at fair value on a recurring basis
Limited partnerships and limited liability companies (fair value)	$ 65,011	$ 66,660

Fair Value Measurements - Carry

Fair Value Measurements - Carrying and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Liabilities
Notes payable net of debt issuance costs	$ 164,778	$ 164,693
Fair value of the notes payable as a percentage of par value	100.80%	101.50%
Carrying Value
Assets
Commercial levered loans	$ 13,725	$ 14,069
Liabilities
Notes payable	165,000	165,000
Unamortized debt issuance costs	(222)	(307)
Notes payable net of debt issuance costs	164,778	164,693
Fair Value
Assets
Commercial levered loans	12,246	13,950
Liabilities
Notes payable	166,288	167,507
Level 2 | Fair Value
Liabilities
Notes payable	166,288	167,507
Level 3 | Fair Value
Assets
Commercial levered loans	$ 12,246	$ 13,950

Fair Value Measurements - Secur

Fair Value Measurements - Securities Measured Using Level 3 (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Changes in fair value of securities measured using Level 3 inputs
Fair value at beginning of period	$ 149,631
Other comprehensive loss	(10,703)
Net realized gain (loss)	1
Purchases	14,241
Settlements	(752)
Fair value at end of period	$ 152,418
Corporate debt securities
Changes in fair value of securities measured using Level 3 inputs
Fair value at beginning of period		$ 126,497
Other comprehensive loss		(1,273)
Net realized gain (loss)		(40)
Purchases		2,329
Settlements		(1,373)
Fair value at end of period		$ 126,140

Accumulated Other Comprehensi_3

Accumulated Other Comprehensive (Loss) Income - Components of AOCI (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
AOCI Attributable to Parent, Net of Tax
Balance at the beginning of period, gross	$ 46,123	$ (29,760)
Unrealized holding gains (losses) on fixed maturity securities, gross	(77,066)	34,803
Amounts reclassified into net income, gross	942	(214)
Amounts reclassified as credit losses, gross	(416)
Other comprehensive (loss) income, gross	(77,592)	35,017
Balance at the end of period, gross	(31,469)	5,257
Balance at the beginning of period, tax	8,670	(7,445)
Unrealized holding gains (losses) on fixed income securities, tax	(16,102)	7,241
Amounts reclassified into net income, tax	136	(24)
Amounts reclassified as credit losses, tax expense (benefit)	(87)	0
Other comprehensive (loss) income, tax	(16,151)	7,265
Balance at the end of period, tax	(7,481)	(180)
Balance at the beginning of period, net	37,453	(22,315)
Unrealized holding gains (losses) on fixed income securities	(60,964)	27,562
Amounts reclassified into net income	806	(190)
Amounts reclassified as credit losses, net	(329)
Other comprehensive (loss) income	(61,441)	27,752
Balance at the end of period, net	$ (23,988)	$ 5,437

Accumulated Other Comprehensi_4

Accumulated Other Comprehensive (Loss) Income - Reclassifications Out of AOCI (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Unrealized gains on securities, tax expense (benefit)	$ 136	$ (24)
Reclassification adjustment for credit losses included in net income	(416)
Reclassification adjustment for credit losses included in net income, tax expense (benefit)	(87)	0
Total reclassifications	477	(190)
Realized Investment Gains (Losses)
Unrealized gains (losses) on securities	942	(214)
Reclassification adjustment for credit losses included in net income	(416)
Income Tax Expense
Unrealized gains on securities, tax expense (benefit)	136	$ (24)
Reclassification adjustment for credit losses included in net income, tax expense (benefit)	$ (87)

Related-Party Information (Deta

Related-Party Information (Details) - USD ($) $ in Thousands	Mar. 15, 2019	Jul. 31, 2019	Mar. 31, 2020	Mar. 31, 2019
Related party transactions
Equity distribution for executive loan repayment				$ 4,174
Executives
Related party transactions
Loans payable			$ 4,200
Former CEO
Related party transactions
Common shares cancelled as per terms of the separation agreement		137,987
Other Expense | Former CEO
Related party transactions
Severance expense			$ 300
Paid-in capital
Related party transactions
Equity distribution for executive loan repayment				$ 4,174
Paid-in capital | Executives
Related party transactions
Equity distribution for executive loan repayment	$ 4,200

Insurance Operations - Reinsura

Insurance Operations - Reinsurance Ceded and Assumed (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Jan. 31, 2020	Mar. 31, 2020	Mar. 31, 2019
Written premiums
Direct written premiums		$ 212,951	$ 254,985
Assumed from other companies		833	853
Ceded to other companies		23,601	45,936
Net written premiums		190,183	209,902
Earned premiums
Direct earned premiums		228,580	223,002
Assumed from other companies		742	942
Ceded to other companies		23,660	28,336
Net premiums earned		$ 205,662	$ 195,608
Percent of amount assumed to net		0.40%	0.50%
Losses and loss adjustment expenses incurred
Direct net losses and loss adjustment expenses incurred		$ 144,377	$ 135,348
Assumed from other companies		(1,357)	2,819
Ceded to other companies		15,463	19,834
Net losses and loss adjustment expenses incurred		$ 127,557	$ 118,333
Gain (loss) on WAQs commuting	$ 0

Insurance Operations - Receivab

Insurance Operations - Receivable allowance rollforward (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020USD ($)
Premium receivable
Beginning Balance	$ 5,056
Current Provision	1,076
Write-offs	(130)
Recoveries	54
Ending Balance	6,056
Reinsurance receivable on paid and unpaid losses
Beginning Balance	505
Current Provision	52
Ending Balance	557
Total receivable allowance
Beginning Balance	5,561
Current Provision	1,128
Write-offs	(130)
Recoveries	54
Ending Balance	6,613
Amount currently with collection agencies	5,200
Uncollateralized exposure	$ 2,800
Percentage of uncollateralized exposure	97.60%

Insurance Operations - Gross Wr

Insurance Operations - Gross Written Premiums (Details) $ in Millions	3 Months Ended
	Mar. 31, 2020USD ($)item	Mar. 31, 2019USD ($)item
Insurance Operations
Number of distribution partners contributing the largest amounts of direct written premiums | item	3	3
Direct premiums written by the largest distribution partners | $	$ 69.1	$ 50.2

Insurance Operations - Unpaid L

Insurance Operations - Unpaid Losses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward]
Gross reserve for unpaid losses and loss expenses, at beginning of year	$ 1,521,648	$ 1,396,812
Ceded reserve for unpaid losses and loss expenses, at beginning of year	193,952	185,295
Net reserve for unpaid losses and loss expenses, at beginning of year	1,327,696	1,211,517
Incurred losses and loss expenses occurring in the:
Current year	121,001	118,728
Prior years	198	(395)
Prior years attributable to adjusted premium	6,358
Total net losses and loss adjustment expenses incurred	127,557	118,333
Paid losses and loss expenses for claims occurring in the:
Current year	3,665	3,528
Prior years	62,655	78,676
Total paid losses and loss expenses for claims	66,320	82,204
Net reserves for unpaid losses and loss expenses, at end of period	1,388,933	1,247,646
Ceded reserve for unpaid losses and loss expenses, at end of period	156,866	201,889
Gross reserve for unpaid losses and loss expenses, at end of period	1,545,799	$ 1,449,535
Commercial Auto
Incurred losses and loss expenses occurring in the:
Prior years	(5,200)
General Liability
Incurred losses and loss expenses occurring in the:
Prior years	4,400
Workers' Compensation
Incurred losses and loss expenses occurring in the:
Prior years	(4,900)
Commercial Multiple Peril
Incurred losses and loss expenses occurring in the:
Prior years	7,100
All Other Lines
Incurred losses and loss expenses occurring in the:
Prior years	$ (1,300)

Income Taxes - Additional Infor

Income Taxes - Additional Information (Details)	Jul. 25, 2019	Mar. 31, 2020	Mar. 31, 2019
Income Taxes
Effective income tax rate		22.60%	21.80%
Conversion ratio of PGHL shares to Company shares	6.46

Segment Information (Details)

Segment Information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020USD ($)segment	Mar. 31, 2019USD ($)
Segment information
Number of reportable segments | segment	1
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 213,784	$ 255,838
Gross written premiums, percent	100.00%	100.00%
Commercial Auto
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 40,331	$ 41,784
Gross written premiums, percent	18.90%	16.30%
General Liability
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 78,533	$ 71,295
Gross written premiums, percent	36.70%	27.90%
Workers' Compensation
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 28,821	$ 90,062
Gross written premiums, percent	13.50%	35.20%
Commercial Multiple Peril
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 16,365	$ 19,634
Gross written premiums, percent	7.60%	7.70%
All Other Lines
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 49,734	$ 33,063
Gross written premiums, percent	23.30%	12.90%
Customer Segment
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 212,284	$ 197,141
Gross written premiums, percent	99.30%	77.10%
Construction
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 24,514	$ 23,248
Gross written premiums, percent	11.50%	9.10%
Consumer Services
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 30,568	$ 27,485
Gross written premiums, percent	14.30%	10.70%
Marine and Energy
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 32,790	$ 19,812
Gross written premiums, percent	15.30%	7.80%
Media and Entertainment
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 30,467	$ 29,692
Gross written premiums, percent	14.30%	11.60%
Professional Services
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 29,698	$ 29,562
Gross written premiums, percent	13.90%	11.60%
Real Estate
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 33,215	$ 28,735
Gross written premiums, percent	15.50%	11.20%
Sports
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 9,565	$ 7,850
Gross written premiums, percent	4.50%	3.10%
Transportation
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 21,467	$ 30,757
Gross written premiums, percent	10.00%	12.00%
Other
Summary of the Company’s gross written premium by customer segments within our Specialty Insurance segment
Gross written premiums	$ 1,500	$ 58,697
Gross written premiums, percent	0.70%	22.90%

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Basic EPS- Income:
Net income (loss) available to common stockholders, continuing operations	$ 6,811	$ 13,695
Net income (loss) available to common stockholders, discontinued operations	$ 257	$ (255)
Basic EPS - Shares:
Shares outstanding, basic (in shares)	43,910	38,851
Basic EPS - Per Share Amount:
Net income from continuing operations	$ 0.16	$ 0.35
Effect of dilutive securities - Shares:
Stock compensation plans (in shares)	364	604
Diluted EPS - Income
Diluted EPS, continuing operations	$ 6,811	$ 13,695
Diluted EPS, discontinued operations	$ 257	$ (255)
Diluted EPS - Shares
Shares outstanding, diluted (in shares)	44,274	39,455
Diluted EPS - Per Share Amount
Diluted earnings per share - continuing operations (in dollars per share)	$ 0.15	$ 0.35
Diluted EPS, discontinued operations (in dollars per share)	$ 0.01	$ (0.01)

Share-Based Compensation - 2019

Share-Based Compensation - 2019 Equity Incentive Plan (Details) - shares	3 Months Ended
	Mar. 31, 2020	Jul. 24, 2019
Restricted stock units
Share-based Compensation
Restricted stock unit awards granted	458,515
2019 Equity Incentive Plan
Share-based Compensation
Number of common stock authorized		4,500,000
Number of common shares reserved for issuance		4,500,000

Share-Based Compensation - 20_2

Share-Based Compensation - 2019 Plan Restricted Stock Activity (Details) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2020USD ($)$ / sharesshares
Unrecognized Share-based Compensation
Unrecognized stock-based compensation expense | $	$ 18.8
Expected weighted average recognition period	2 years 4 months 24 days
Restricted stock units
Restricted Stock Units
Unvested at beginning of period | shares	1,289,396
Granted | shares	458,515
Vested | shares	(179)
Forfeited | shares	(5,358)
Unvested at end of period | shares	1,742,374
Weighted Average Grant Date Fair Value Per Share
Non vested outstanding at beginning of period | $ / shares	$ 14
Granted | $ / shares	13.40
Vested | $ / shares	14
Forfeited | $ / shares	14
Non vested outstanding at end of period | $ / shares	$ 13.84

Commitments and Contingencies -

Commitments and Contingencies - Narrative (Details) $ in Millions	3 Months Ended
	Mar. 31, 2020USD ($)
Leases
Lessee, operating lease, discount rate	2.00%
Operating lease, cost	$ 0.8
Weighted Average
Leases
Lessee, operating lease, term of contract	2 years 10 months 24 days

Commitments and Contingencies_2

Commitments and Contingencies - Lease Liabilities and Right-of-Use Lease Assets (Details) $ in Thousands	Mar. 31, 2020USD ($)
Lease Assets and Liabilities
One year or less	$ 3,188
More than one year to two years	2,449
Total undiscounted future minimum lease payments	5,637
Less: difference between lease payments and discounted lease liabilities	104
Lease liability	5,533
Right-of-use assets	4,810
Prepaid lease assets, net of lease allowances and incentives	723
Total	$ 5,533