Document and Entity Information
Document and Entity Information Document - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 21, 2022 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
Entity Registrant Name | KINSALE CAPITAL GROUP, INC. | |
Entity File Number | 001-37848 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 98-0664337 | |
Entity Address, Address Line One | 2035 Maywill Street | |
Entity Address, Address Line Two | Suite 100 | |
Entity Address, City or Town | Richmond | |
Entity Address, State or Province | VA | |
Entity Address, Postal Zip Code | 23230 | |
Entity Current Reporting Status | Yes | |
City Area Code | 804 | |
Local Phone Number | 289-1300 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | KNSL | |
Security Exchange Name | NYSE | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 22,925,235 | |
Entity Central Index Key | 0001669162 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Assets | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | $ 1,605,847 | $ 1,392,066 |
Equity securities, at fair value (cost: $117,218 – 2022; $118,895 – 2021) | 133,735 | 172,611 |
Short-term investments | 81,408 | 0 |
Total investments | 1,820,990 | 1,564,677 |
Cash and Cash Equivalents, at Carrying Value | 126,213 | 121,040 |
Investment income due and accrued | 11,663 | 7,658 |
Premiums receivable, net | 96,102 | 71,004 |
Reinsurance recoverables, net | 188,803 | 122,970 |
Ceded unearned premiums | 40,924 | 33,679 |
Deferred policy acquisition costs, net of ceding commissions | 58,445 | 41,968 |
Intangible assets | 3,538 | 3,538 |
Deferred Income Tax Assets, Net | 59,136 | 2,109 |
Other assets | 58,418 | 57,012 |
Total assets | 2,464,232 | 2,025,655 |
Liabilities | ||
Reserves for unpaid losses and loss adjustment expenses | 1,197,317 | 881,344 |
Unearned premiums | 471,736 | 347,730 |
Payable to reinsurers | 26,323 | 16,112 |
Accounts payable and accrued expenses | 22,218 | 23,250 |
Credit facility | 0 | 42,696 |
Debt | 123,159 | |
Other liabilities | 4,024 | 15,188 |
Total liabilities | 1,844,777 | 1,326,320 |
Stockholders' Equity | ||
Common stock, $0.01 par value, 400,000,000 shares authorized, 22,924,522 and 22,834,377 shares issued and outstanding at September 30, 2022 and December 31, 2021 respectively | 229 | 228 |
Additional paid-in capital | 297,692 | 295,040 |
Retained earnings | 468,873 | 385,942 |
Accumulated other comprehensive (loss) income | (147,339) | 18,125 |
Total stockholders’ equity | 619,455 | 699,335 |
Total liabilities and stockholders’ equity | $ 2,464,232 | $ 2,025,655 |
Consolidated Balance Sheet (Una
Consolidated Balance Sheet (Unaudited) (Parentheticals) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Assets [Abstract] | ||
Fixed-maturity securities available-for-sale - amortized cost | $ 1,794,729 | $ 1,371,519 |
Equity securities - cost | $ 117,218 | $ 118,895 |
Stockholders' Equity | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares issued (in shares) | 22,924,522 | 22,834,377 |
Common stock, shares outstanding (in shares) | 22,924,522 | 22,834,377 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenues: | ||||
Gross written premiums | $ 284,111 | $ 197,616 | $ 806,625 | $ 560,553 |
Ceded written premiums | (48,212) | (26,939) | (111,885) | (77,825) |
Net written premiums | 235,899 | 170,677 | 694,740 | 482,728 |
Change in unearned premiums | (26,640) | (13,806) | (116,761) | (65,116) |
Net earned premiums | 209,259 | 156,871 | 577,979 | 417,612 |
Net investment income | 13,858 | 8,095 | 33,540 | 22,466 |
Change in the fair value of equity securities | (6,095) | (1,012) | (37,199) | 13,644 |
Net realized investment gains | (173) | 895 | 1,535 | 2,397 |
Other income | 112 | 35 | 381 | 58 |
Total revenues | 216,961 | 164,884 | 576,236 | 456,177 |
Expenses: | ||||
Losses and loss adjustment expenses | 134,788 | 87,352 | 344,333 | 236,727 |
Underwriting, acquisition and insurance expenses | 40,145 | 31,465 | 117,662 | 89,490 |
Interest Expense | 1,716 | 243 | 2,306 | 752 |
Other expenses | 212 | 145 | 521 | 482 |
Total expenses | 176,861 | 119,205 | 464,822 | 327,451 |
Income before income taxes | 40,100 | 45,679 | 111,414 | 128,726 |
Total income tax expense | 7,116 | 9,054 | 19,549 | 24,387 |
Net income | 32,984 | 36,625 | 91,865 | 104,339 |
Other comprehensive income (loss): | ||||
Change in net unrealized losses on available-for-sale investments, net of taxes | (46,652) | (6,072) | (165,464) | (16,111) |
Total comprehensive (loss) income | $ (13,668) | $ 30,553 | $ (73,599) | $ 88,228 |
Earnings per share: | ||||
Basic | $ 1.45 | $ 1.61 | $ 4.03 | $ 4.60 |
Diluted | $ 1.43 | $ 1.59 | $ 3.98 | $ 4.53 |
Weighted average shares outstanding: | ||||
Basic | 22,813 | 22,714 | 22,783 | 22,681 |
Diluted | 23,114 | 23,064 | 23,099 | 23,057 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
Balance, shares at Dec. 31, 2020 | 22,757,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation (shares) | 55,000 | ||||
Balance, shares at Mar. 31, 2021 | 22,812,000 | ||||
Balance at Dec. 31, 2020 | $ 576,238 | $ 228 | $ 291,315 | $ 243,315 | $ 41,380 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of stock under stock-based compensation plan | 339 | 0 | 339 | ||
Stock-based compensation expense | 1,036 | 1,036 | |||
Dividends declared | (2,504) | (2,504) | |||
Other comprehensive income (loss), net of tax | (19,622) | (19,622) | |||
Net income | 32,079 | 32,079 | |||
Balance at Mar. 31, 2021 | $ 587,566 | 228 | 292,690 | 272,890 | 21,758 |
Balance, shares at Dec. 31, 2020 | 22,757,000 | ||||
Balance, shares at Sep. 30, 2021 | 22,819,000 | ||||
Balance at Dec. 31, 2020 | $ 576,238 | 228 | 291,315 | 243,315 | 41,380 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Other comprehensive income (loss), net of tax | (16,111) | ||||
Net income | 104,339 | ||||
Balance at Sep. 30, 2021 | $ 659,165 | 228 | 293,535 | 340,133 | 25,269 |
Balance, shares at Mar. 31, 2021 | 22,812,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation (shares) | 7,000 | ||||
Restricted shares withheld for taxes (shares) | (13,000) | ||||
Balance, shares at Jun. 30, 2021 | 22,806,000 | ||||
Balance at Mar. 31, 2021 | $ 587,566 | 228 | 292,690 | 272,890 | 21,758 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of stock under stock-based compensation plan | 163 | 0 | 163 | ||
Stock-based compensation expense | 1,279 | 1,279 | |||
Restricted shares withheld for taxes | (2,082) | (2,082) | |||
Dividends declared | (2,508) | (2,508) | |||
Other comprehensive income (loss), net of tax | 9,583 | 9,583 | |||
Net income | 35,635 | 35,635 | |||
Balance at Jun. 30, 2021 | $ 629,636 | 228 | 292,050 | 306,017 | 31,341 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation (shares) | 13,000 | ||||
Balance, shares at Sep. 30, 2021 | 22,819,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of stock under stock-based compensation plan | $ 220 | 0 | 220 | ||
Stock-based compensation expense | 1,265 | 1,265 | |||
Dividends declared | (2,509) | (2,509) | |||
Other comprehensive income (loss), net of tax | (6,072) | (6,072) | |||
Net income | 36,625 | 36,625 | |||
Balance at Sep. 30, 2021 | $ 659,165 | 228 | 293,535 | 340,133 | 25,269 |
Balance, shares at Dec. 31, 2021 | 22,834,377 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation (shares) | 76,000 | ||||
Restricted shares withheld for taxes (shares) | (2,000) | ||||
Balance, shares at Mar. 31, 2022 | 22,908,000 | ||||
Balance at Dec. 31, 2021 | $ 699,335 | 228 | 295,040 | 385,942 | 18,125 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of stock under stock-based compensation plan | 378 | 1 | 377 | ||
Stock-based compensation expense | 1,489 | 1,489 | |||
Restricted shares withheld for taxes | (516) | (516) | |||
Dividends declared | (2,977) | (2,977) | |||
Other comprehensive income (loss), net of tax | (63,930) | (63,930) | |||
Net income | 31,791 | 31,791 | |||
Balance at Mar. 31, 2022 | $ 665,570 | 229 | 296,390 | 414,756 | (45,805) |
Balance, shares at Dec. 31, 2021 | 22,834,377 | ||||
Balance, shares at Sep. 30, 2022 | 22,924,522 | ||||
Balance at Dec. 31, 2021 | $ 699,335 | 228 | 295,040 | 385,942 | 18,125 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Other comprehensive income (loss), net of tax | (165,464) | ||||
Net income | 91,865 | ||||
Balance at Sep. 30, 2022 | $ 619,455 | 229 | 297,692 | 468,873 | (147,339) |
Balance, shares at Mar. 31, 2022 | 22,908,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation (shares) | 8,000 | ||||
Restricted shares withheld for taxes (shares) | (12,000) | ||||
Balance, shares at Jun. 30, 2022 | 22,904,000 | ||||
Balance at Mar. 31, 2022 | $ 665,570 | 229 | 296,390 | 414,756 | (45,805) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of stock under stock-based compensation plan | 150 | 0 | 150 | ||
Stock-based compensation expense | 1,857 | 1,857 | |||
Restricted shares withheld for taxes | (2,741) | (2,741) | |||
Dividends declared | (2,978) | (2,978) | |||
Other comprehensive income (loss), net of tax | (54,882) | (54,882) | |||
Net income | 27,090 | 27,090 | |||
Balance at Jun. 30, 2022 | $ 634,066 | 229 | 295,656 | 438,868 | (100,687) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation (shares) | 21,000 | ||||
Balance, shares at Sep. 30, 2022 | 22,924,522 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of stock under stock-based compensation plan | $ 373 | 0 | 373 | ||
Stock-based compensation expense | 1,663 | 1,663 | |||
Dividends declared | (2,979) | (2,979) | |||
Other comprehensive income (loss), net of tax | (46,652) | (46,652) | |||
Net income | 32,984 | 32,984 | |||
Balance at Sep. 30, 2022 | $ 619,455 | $ 229 | $ 297,692 | $ 468,873 | $ (147,339) |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Unaudited) (Parentheticals) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | |
Statement of Stockholders' Equity [Abstract] | ||||||
Dividends declared, per share | $ 0.13 | $ 0.13 | $ 0.13 | $ 0.11 | $ 0.11 | $ 0.11 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Operating Activities | ||
Net cash provided by operating activities | $ 456,699 | $ 301,881 |
Investing Activities | ||
Purchase of property and equipment | (4,744) | (4,770) |
Change in short-term investments, net | (81,113) | 0 |
Purchases – fixed-maturity securities | (599,735) | (509,000) |
Purchases - equity securities | (1,098) | (11,717) |
Sales – fixed-maturity securities | 73,066 | 102,552 |
Sales – equity securities | 3,990 | 3,185 |
Maturities and calls – fixed-maturity securities | 89,783 | 139,669 |
Net cash used in investing activities | (519,851) | (280,081) |
Financing Activities | ||
Proceeds from Issuance of Long-Term Debt | 125,000 | 0 |
Repayments of Long-Term Lines of Credit | (43,000) | 0 |
Payments of Debt Issuance Costs | (2,381) | 0 |
Payroll taxes withheld and remitted on share-based payments | (3,257) | (2,082) |
Proceeds from stock options exercised | 901 | 722 |
Dividends paid | (8,938) | (7,521) |
Net cash provided by (used in) financing activities | 68,325 | (8,881) |
Net change in cash and cash equivalents | 5,173 | 12,919 |
Cash and cash equivalents at beginning of period | 77,093 | |
Cash and cash equivalents at end of period | $ 126,213 | $ 90,012 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of presentation The unaudited condensed consolidated financial statements and notes have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and do not contain all of the information and footnotes required by U.S. GAAP for complete financial statements. As such, these unaudited condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements of Kinsale Capital Group, Inc. and its subsidiaries ("the Company") included in the Annual Report on Form 10-K for the year ended December 31, 2021. In the opinion of management, all adjustments necessary for a fair presentation of the condensed consolidated financial statements have been included. Such adjustments consist only of normal recurring items. 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. Use of estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, if any, at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Prospective accounting pronouncements There are no prospective accounting standards which, upon their effective date, would have a material impact on the Company's condensed consolidated financial statements. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2022 | |
Investments [Abstract] | |
Investments | Investments Available-for-sale investments The following tables summarize the available-for-sale investments at September 30, 2022 and December 31, 2021: September 30, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 22,945 $ — $ (1,347) $ 21,598 Obligations of states, municipalities and political subdivisions 230,156 100 (27,589) 202,667 Corporate and other securities 795,400 73 (87,910) 707,563 Asset-backed securities 323,601 226 (8,684) 315,143 Residential mortgage-backed securities 356,947 62 (57,773) 299,236 Commercial mortgage-backed securities 65,680 — (6,040) 59,640 Total fixed-maturity investments $ 1,794,729 $ 461 $ (189,343) $ 1,605,847 December 31, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 6,936 $ — $ (89) $ 6,847 Obligations of states, municipalities and political subdivisions 216,375 12,139 (469) 228,045 Corporate and other securities 450,594 11,714 (3,821) 458,487 Asset-backed securities 299,810 2,217 (252) 301,775 Residential mortgage-backed securities 340,804 1,804 (4,923) 337,685 Commercial mortgage-backed securities 57,000 2,433 (206) 59,227 Total fixed-maturity investments $ 1,371,519 $ 30,307 $ (9,760) $ 1,392,066 Available-for-sale securities in a loss position The Company regularly reviews all its available-for-sale investments with unrealized losses to assess whether the decline in the fair value is deemed to be a credit loss. The Company considers a number of factors in completing its review of credit losses, including the extent to which a security's fair value has been below cost and the financial condition of an issuer. In addition to specific issuer information, the Company also evaluates the current market and interest rate environment. Generally, a decline in a security’s value caused by a change in the market or interest rate environment does not constitute a credit loss. For fixed-maturity securities, the Company also considers whether it intends to sell the security or, if it is more likely than not that it will be required to sell the security before recovery, and its ability to recover all amounts outstanding when contractually due. When assessing whether it intends to sell a fixed-maturity security or, if it is likely to be required to sell a fixed-maturity security before recovery of its amortized cost, the Company evaluates facts and circumstances including, but not limited to, decisions to reposition the investment portfolio, potential sales of investments to meet cash flow needs and potential sales of investments to capitalize on favorable pricing. For fixed-maturity securities where a decline in fair value is below the amortized cost basis and the Company intends to sell the security, or it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost, an impairment is recognized in net income based on the fair value of the security at the time of assessment. For fixed-maturity securities that the Company does not intend to sell or for which it is more likely than not that the Company would not be required to sell before recovery of its amortized cost, the Company compares the estimated present value of the cash flows expected to be collected to the amortized cost of the security. The extent to which the estimated present value of the cash flows expected to be collected is less than the amortized cost of the security represents the credit-related portion of the impairment, which is recognized in net income through an allowance for credit losses. Any remaining decline in fair value represents the noncredit portion of the impairment, which is recognized in other comprehensive income. The Company reports investment income due and accrued separately from available-for-sale investments and has elected not to measure an allowance for credit losses for investment income due and accrued. Investment income due and accrued is written off through earnings at the time the issuer of the bond defaults or is expected to default on payments. The following tables summarize gross unrealized losses and estimated fair value for available-for-sale investments by length of time that the securities have continuously been in an unrealized loss position: September 30, 2022 Less than 12 Months 12 Months or Longer Total Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses (in thousands) Fixed maturities: U.S. Treasury securities and obligations of the U.S. government agencies $ 15,457 $ (542) $ 6,141 $ (805) $ 21,598 $ (1,347) Obligations of states, municipalities and political subdivisions 169,711 (23,087) 12,935 (4,502) 182,646 (27,589) Corporate and other securities 596,026 (61,181) 94,449 (26,729) 690,475 (87,910) Asset-backed securities 269,716 (7,449) 31,305 (1,235) 301,021 (8,684) Residential mortgage-backed securities 163,761 (25,163) 133,937 (32,610) 297,698 (57,773) Commercial mortgage-backed securities 52,555 (4,659) 7,085 (1,381) 59,640 (6,040) Total fixed-maturity investments $ 1,267,226 $ (122,081) $ 285,852 $ (67,262) $ 1,553,078 $ (189,343) At September 30, 2022, the Company held 984 fixed-maturity securities in an unrealized loss position with a total estimated fair value of $1.6 billion and gross unrealized losses of $189.3 million. Of these securities, 130 were in a continuous unrealized loss position for greater than one year. As discussed above, the Company regularly reviews all fixed-maturity securities within its investment portfolio to determine whether a credit loss has occurred. Based on the Company's review as of September 30, 2022, unrealized losses were caused by interest rate changes or other market factors and were not credit-specific issues. At September 30, 2022, 79.8% of the Company’s fixed-maturity securities were rated "A-" or better and all of the Company’s fixed-maturity securities made expected coupon payments under the contractual terms of the securities. For the nine months ended September 30, 2022, the Company concluded that there were no credit-related impairments of fixed-maturity securities in an unrealized loss position. December 31, 2021 Less than 12 Months 12 Months or Longer Total Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses (in thousands) Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 6,847 $ (89) $ — $ — $ 6,847 $ (89) Obligations of states, municipalities and political subdivisions 23,870 (469) — — 23,870 (469) Corporate and other securities 188,522 (3,718) 1,092 (103) 189,614 (3,821) Asset-backed securities 136,669 (204) 4,452 (48) 141,121 (252) Residential mortgage-backed securities 260,251 (4,329) 17,968 (594) 278,219 (4,923) Commercial mortgage-backed securities 10,773 (206) — — 10,773 (206) Total fixed-maturity investments $ 626,932 $ (9,015) $ 23,512 $ (745) $ 650,444 $ (9,760) Contractual maturities of available-for-sale fixed-maturity securities The amortized cost and estimated fair value of available-for-sale fixed-maturity securities at September 30, 2022 are summarized, by contractual maturity, as follows: September 30, 2022 Amortized Estimated Cost Fair Value (in thousands) Due in one year or less $ 14,977 $ 14,823 Due after one year through five years 531,759 506,959 Due after five years through ten years 245,305 207,332 Due after ten years 256,460 202,714 Asset-backed securities 323,601 315,143 Residential mortgage-backed securities 356,947 299,236 Commercial mortgage-backed securities 65,680 59,640 Total fixed-maturity securities $ 1,794,729 $ 1,605,847 Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties, and the lenders may have the right to put the securities back to the borrower. Net investment income The following table presents the components of net investment income for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Interest: Taxable bonds $ 12,041 $ 6,471 $ 29,015 $ 18,356 Tax exempt municipal bonds 849 874 2,558 2,636 Cash equivalents and short-term investments 475 1 598 11 Dividends on equity securities 1,085 979 3,208 2,801 Gross investment income 14,450 8,325 35,379 23,804 Investment expenses (592) (230) (1,839) (1,338) Net investment income $ 13,858 $ 8,095 $ 33,540 $ 22,466 Realized investment gains and losses The following table presents realized investment gains and losses for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Fixed-maturity securities: Realized gains $ — $ 804 $ 1,076 $ 2,445 Realized losses (177) — (720) (2) Net realized (losses) gains from fixed-maturity securities (177) 804 356 2,443 Equity securities: Realized gains — 97 1,363 97 Realized losses — (6) (148) (143) Net realized gains (losses) from equity securities — 91 1,215 (46) Realized gains (losses) from the sales of short-term investments 4 — (36) — Net realized investment (losses) gains $ (173) $ 895 $ 1,535 $ 2,397 Change in net unrealized losses on fixed-maturity securities For the three and nine months ended September 30, 2022, the changes in net unrealized losses for fixed-maturity securities were $(59.1) million and $(209.4) million, respectively. For the three and nine months ended September 30, 2021, the changes in net unrealized losses for fixed-maturity securities were $(7.7) million and $(20.4) million, respectively. Insurance – statutory deposits The Company had invested assets with a fair value of $6.3 million and $6.7 million on deposit with state regulatory authorities at September 30, 2022 and December 31, 2021, respectively. Payable for investments purchased The Company recorded a payable for investments purchased, not yet settled, of $3.9 million and $15.0 million at September 30, 2022 and December 31, 2021, respectively. The payable balance was included in the "other liabilities" line item of the consolidated balance sheet. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair value is estimated for each class of financial instrument based on the framework established in the fair value accounting guidance. Fair value is defined as the price in the principal market that would be received for an asset or paid to transfer a liability to facilitate an orderly transaction between market participants on the measurement date. Market participants are assumed to be independent, knowledgeable, able and willing to transact an exchange and not acting under duress. Fair value hierarchy disclosures are based on the quality of inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Adjustments to transaction prices or quoted market prices may be required in illiquid or disorderly markets in order to estimate fair value. The three levels of the fair value hierarchy are defined as follows: Level 1 - Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities traded in active markets. Level 2 - Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs. Level 3 - Inputs to the valuation methodology are unobservable for the asset or liability and are significant to the fair value measurement. Fair values of the Company's investment portfolio are estimated using unadjusted prices obtained by its investment accounting vendor from nationally recognized third-party pricing services, where available. Values for U.S. Treasuries and exchange traded funds are generally based on Level 1 inputs, which use quoted prices in active markets for identical assets. For other fixed-maturity securities and non-redeemable preferred stock, the pricing vendors use a pricing methodology involving the market approach, including pricing models which use prices and relevant market information regarding a particular security or securities with similar characteristics to establish a valuation. The estimates of fair value of these investments are included in the amounts disclosed as Level 2. For those investments where significant inputs are unobservable, the Company's investment accounting vendor obtains valuations from pricing vendors or brokers using the market approach and income approach valuation techniques and are disclosed as Level 3. Management performs several procedures to ascertain the reasonableness of investment values included in the condensed consolidated financial statements, including 1) obtaining and reviewing internal control reports from the Company's investment accounting vendor that assess fair values from third party pricing services, 2) discussing with the Company's investment accounting vendor its process for reviewing and validating pricing obtained from third party pricing services and 3) reviewing the security pricing received from the Company's investment accounting vendor and monitoring changes in unrealized gains and losses at the individual security level. The Company has evaluated the various types of securities in its investment portfolio to determine an appropriate fair value hierarchy level based upon trading activity and the observability of market inputs. The following tables present the balances of assets measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021, by level within the fair value hierarchy: September 30, 2022 Level 1 Level 2 Level 3 Total (in thousands) Assets Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 21,598 $ — $ — $ 21,598 Obligations of states, municipalities and political subdivisions — 202,667 — 202,667 Corporate and other securities — 707,563 — 707,563 Asset-backed securities — 315,143 — 315,143 Residential mortgage-backed securities — 299,236 — 299,236 Commercial mortgage-backed securities — 59,640 — 59,640 Total fixed-maturity securities 21,598 1,584,249 — 1,605,847 Equity securities: Exchange traded funds 94,898 — — 94,898 Non-redeemable preferred stock — 38,837 — 38,837 Total equity securities 94,898 38,837 — 133,735 Short-term investments 81,056 352 — 81,408 Total $ 197,552 $ 1,623,438 $ — $ 1,820,990 December 31, 2021 Level 1 Level 2 Level 3 Total (in thousands) Assets Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 6,847 $ — $ — $ 6,847 Obligations of states, municipalities and political subdivisions — 228,045 — 228,045 Corporate and other securities — 458,487 — 458,487 Asset-backed securities — 301,775 — 301,775 Residential mortgage-backed securities — 337,685 — 337,685 Commercial mortgage-backed securities — 59,227 — 59,227 Total fixed-maturity securities 6,847 1,385,219 — 1,392,066 Equity securities: Exchange traded funds 123,389 — — 123,389 Non-redeemable preferred stock — 49,222 — 49,222 Total equity securities 123,389 49,222 — 172,611 Total $ 130,236 $ 1,434,441 $ — $ 1,564,677 There were no assets or liabilities measured at fair value on a nonrecurring basis as of September 30, 2022 or December 31, 2021. The carrying amount of the Company's 5.15% Series A Senior Notes was $125.0 million, less debt issuance cost, and the corresponding estimated fair value was $115.1 million at September 30, 2022. The fair value measurement was determined using a discounted cash flow analysis that factors in current market yields for comparable borrowing arrangements under the Company's credit profile. Since this methodology is based upon market yields for comparable arrangements, the measurement is categorized as Level 2. The estimated fair value of outstanding borrowings under the Company's revolving Credit Facility approximated its carrying value at December 31,2021. There were no outstanding borrowings under the Credit Facility at September 30, 2022. See Note 12 for further information regarding the Company's debt arrangements. |
Deferred Policy Acquisition Cos
Deferred Policy Acquisition Costs | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Policy Acquisition Costs Disclosures [Abstract] | |
Deferred Policy Acquisition Costs | Deferred Policy Acquisition Costs The following table presents the amounts of policy acquisition costs deferred and amortized for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Balance, beginning of period $ 54,806 $ 38,801 $ 41,968 $ 31,912 Policy acquisition costs deferred: Direct commissions 41,525 28,837 117,621 81,740 Ceding commissions (13,886) (8,089) (32,678) (21,283) Other underwriting and policy acquisition costs 2,302 1,600 6,534 4,540 Policy acquisition costs deferred 29,941 22,348 91,477 64,997 Amortization of net policy acquisition costs (26,302) (20,876) (75,000) (56,636) Balance, end of period $ 58,445 $ 40,273 $ 58,445 $ 40,273 Amortization of net policy acquisition costs is included in the line item "Underwriting, acquisition and insurance expenses" in the accompanying consolidated statements of income and comprehensive income. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2022 | |
Property and Equipment [Abstract] | |
Property and Equipment Disclosure [Text Block] | Property and Equipment, Net Property and equipment are included in "other assets" in the accompanying consolidated balance sheets and consist of the following: September 30, 2022 December 31, 2021 (in thousands) Building $ 33,065 $ 33,101 Parking deck 5,072 5,072 Land 3,068 3,068 Equipment 3,339 3,143 Software 10,572 7,849 Furniture and fixtures 2,161 2,158 Land improvements 474 474 Construction in progress - building 1,858 — 59,609 54,865 Accumulated depreciation (7,583) (5,570) Total property and equipment, net $ 52,026 $ 49,295 |
Underwriting, Acquisition and I
Underwriting, Acquisition and Insurance Expenses | 9 Months Ended |
Sep. 30, 2022 | |
Underwriting, Acquisition and Insurance Expenses [Abstract] | |
Underwriting, acquisition and insurance expenses | Underwriting, Acquisition and Insurance Expenses Underwriting, acquisition and insurance expenses for the three and nine months ended September 30, 2022 and 2021 consist of the following: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Underwriting, acquisition and insurance expenses incurred: Direct commissions $ 37,177 $ 26,317 $ 99,540 $ 71,036 Ceding commissions (12,939) (6,902) (30,069) (18,344) Other operating expenses 15,907 12,050 48,191 36,798 Total $ 40,145 $ 31,465 $ 117,662 $ 89,490 Other operating expenses within underwriting, acquisition and insurance expenses include salaries, bonus and employee benefits expenses of $15.4 million and $11.6 million for the three months ended September 30, 2022 and 2021, respectively. Other operating expenses within underwriting, acquisition and insurance expenses include salaries, bonus and employee benefits expenses of $46.1 million and $34.9 million for the nine months ended September 30, 2022 and 2021, respectively. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation | Stock-based Compensation On July 27, 2016, the Kinsale Capital Group, Inc. 2016 Omnibus Incentive Plan (the "2016 Incentive Plan") became effective. The 2016 Incentive Plan, which is administered by the Compensation, Nominating and Corporate Governance Committee of the Company’s Board of Directors, provides for grants of stock options, restricted stock, restricted stock units and other stock-based awards to officers, employees, directors, independent contractors and consultants. The number of shares of common stock available for issuance under the 2016 Incentive Plan may not exceed 2,073,832. The total compensation cost that has been charged against income for share-based compensation arrangements was $5.0 million and $3.6 million for the nine months ended September 30, 2022 and 2021, respectively. Restricted Stock Awards During the nine months ended September 30, 2022, the Company granted restricted stock awards under the 2016 Incentive Plan. The restricted stock awards were valued on the date of grant and will vest over a period of 1 to 4 years corresponding to the anniversary date of the grants. The fair value of restricted stock awards was determined based on the closing trading price of the Company’s shares on the grant date or, if no shares were traded on the grant date, the last preceding date for which there was a sale of shares. Except for restrictions placed on the transferability of restricted stock, holders of unvested restricted stock have full stockholder’s rights, including voting rights and the right to receive dividends. Unvested shares of restricted stock awards and accrued dividends, if any, are forfeited upon the termination of service to or employment with the Company. A summary of restricted stock activity under the 2016 Incentive Plan for the nine months ended September 30, 2022 is as follows: For the Nine Months Ended September 30, 2022 Number of Shares Weighted Average Grant Date Fair Value per Share Non-vested outstanding at the beginning of the period 95,984 $ 131.94 Granted 52,863 $ 211.86 Vested (44,992) $ 109.76 Forfeited (4,171) $ 178.30 Non-vested outstanding at the end of the period 99,684 $ 182.40 Employees surrender shares to pay for withholding tax obligations resulting from any vesting of restricted stock awards. During the nine months ended September 30, 2022, shares withheld for taxes in connection with the vesting of restricted stock awards totaled 14,879. The weighted average grant-date fair value per share of the Company's restricted stock awards granted during the nine months ended September 30, 2022 and 2021 was $211.86 and $185.00, respectively. The fair value of restricted stock awards that vested during the nine months ended September 30, 2022 and 2021 was $9.9 million and $6.8 million, respectively. As of September 30, 2022, the Company had $14.6 million of total unrecognized stock-based compensation expense expected to be charged to earnings over a weighted-average period of 2.8 years. Stock Options On July 27, 2016, the Board of Directors approved, and the Company granted, 1,036,916 stock options with an exercise price equal to the initial public offering price of $16.00 per share and a weighted-average grant-date fair value of $2.71 per share. The options have a maximum contractual term of 10 years and vested in 4 equal annual installments following the date of the grant. The value of the options granted was estimated at the date of grant using the Black-Scholes pricing model using the following assumptions: Risk-free rate of return 1.26 % Dividend yield 1.25 % Expected share price volatility (1) 18.50 % Expected life in years (2) 6.3 years (1) Expected volatility was based on the Company’s competitors within the industry. (2) Expected life was calculated using the simplified method, which was an average of the contractual term of the option and its ordinary vesting period, as the Company did not have sufficient historical data for determining the expected term of our stock option awards. A summary of option activity as of September 30, 2022, and changes during the period then ended is presented below: Number of Shares Weighted-Average Exercise Price Weighted-Average Remaining Years of Contractual Term Aggregate Intrinsic Value (in thousands) Outstanding at January 1, 2022 325,433 $ 16.00 Granted — — Forfeited (934) 16.00 Exercised (56,332) 16.00 Outstanding at September 30, 2022 268,167 $ 16.00 3.6 $ 64,205 Exercisable at September 30, 2022 268,167 $ 16.00 3.6 $ 64,205 |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following represents a reconciliation of the numerator and denominator of the basic and diluted earnings per share computations contained in the condensed consolidated financial statements: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands, except per share data) Net income $ 32,984 $ 36,625 $ 91,865 $ 104,339 Weighted average common shares outstanding - basic 22,813 22,714 22,783 22,681 Effect of potential dilutive securities: Conversion of stock options 262 317 276 329 Conversion of restricted stock 39 33 40 47 Weighted average common shares outstanding - diluted 23,114 23,064 23,099 23,057 Earnings per common share: Basic $ 1.45 $ 1.61 $ 4.03 $ 4.60 Diluted $ 1.43 $ 1.59 $ 3.98 $ 4.53 There were no anti-dilutive stock awards for the three months ended September 30, 2022 and 2021. There were 48 thousand and 30 thousand anti-dilutive stock awards for the nine months ended September 30, 2022 and 2021, respectively. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes 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 tax-exempt investment income and any discrete items recognized during the period. The Company's effective tax rates were 17.5% and 18.9% for the nine months ended September 30, 2022 and 2021, respectively. The effective tax rates were lower than the federal statutory rate of 21% due primarily to the tax benefits from stock-based compensation and from income generated by certain tax-exempt investments. |
Reserves for Unpaid Losses and
Reserves for Unpaid Losses and Loss Adjustment Expenses | 9 Months Ended |
Sep. 30, 2022 | |
Liability for Unpaid Claims and Claims Adjustment Expense, Activity in Liability [Abstract] | |
Reserves for Unpaid Losses and Loss Adjustment Expenses | Reserves For Unpaid Losses and Loss Adjustment Expenses The following table presents a reconciliation of consolidated beginning and ending reserves for unpaid losses and loss adjustment expenses: September 30, 2022 2021 (in thousands) Gross reserves for unpaid losses and loss adjustment expenses, beginning of year $ 881,344 $ 636,013 Less: reinsurance recoverable on unpaid losses 117,561 83,730 Net reserves for unpaid losses and loss adjustment expenses, beginning of year 763,783 552,283 Incurred losses and loss adjustment expenses: Current year 373,183 262,140 Prior years (28,850) (25,413) Total net losses and loss adjustment expenses incurred 344,333 236,727 Payments: Current year 13,028 12,110 Prior years 84,827 68,546 Total payments 97,855 80,656 Net reserves for unpaid losses and loss adjustment expenses, end of period 1,010,261 708,354 Reinsurance recoverable on unpaid losses 187,056 106,502 Gross reserves for unpaid losses and loss adjustment expenses, end of period $ 1,197,317 $ 814,856 During the nine months ended September 30, 2022, the reserves for unpaid losses and loss adjustment expenses held at December 31, 2021 developed favorably by $28.9 million, of which $32.0 million was attributable to the 2020 and 2021 accident years due to lower emergence of reported losses than expected across most lines of business. This favorable development was offset in part by adverse development largely from the 2018 accident year due to routine variability in reported losses and modest adjustments in actuarial assumptions. Current accident year incurred losses and loss adjustment expenses for the nine months ended September 30, 2022 included $26.2 million of catastrophe losses primarily related to Hurricane Ian. During the nine months ended September 30, 2021, the reserves for unpaid losses and loss adjustment expenses held at December 31, 2020 developed favorably by $25.4 million, of which $28.9 million was attributable to the 2020 accident year. The favorable development for the 2020 accident year reflected the Company's improved outlook related to potential COVID-19 related claims as no significant claims had been reported to date. In addition, reported losses emerged at lower levels than expected across most lines of business. This favorable development was offset in part by adverse development, mostly attributable to the 2015-2018 accident years as a result of modest adjustments in actuarial assumptions based on observable trends. Current accident year incurred losses and loss adjustment |
Reinsurance
Reinsurance | 9 Months Ended |
Sep. 30, 2022 | |
Reinsurance Disclosures [Abstract] | |
Reinsurance | Reinsurance The following table summarizes the effect of reinsurance on premiums written and earned for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Premiums written: Direct $ 284,111 $ 197,616 $ 806,625 $ 560,553 Ceded (48,212) (26,939) (111,885) (77,825) Net written $ 235,899 $ 170,677 $ 694,740 $ 482,728 Premiums earned: Direct $ 254,855 $ 180,458 $ 682,619 $ 486,920 Ceded (45,596) (23,587) (104,640) (69,308) Net earned $ 209,259 $ 156,871 $ 577,979 $ 417,612 The following table summarizes ceded losses and loss adjustment expenses for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Ceded incurred losses and loss adjustment expenses $ 56,774 $ 10,640 $ 79,790 $ 34,053 The following table presents reinsurance recoverables on paid and unpaid losses as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (in thousands) Reinsurance recoverables on paid losses $ 1,747 $ 5,409 Reinsurance recoverables on unpaid losses, net 187,056 117,561 Reinsurance recoverables, net $ 188,803 $ 122,970 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Debt Note Purchase and Private Shelf Agreement On July 22, 2022, the Company entered into a Note Purchase and Private Shelf Agreement (the “Note Purchase Agreement”) with PGIM, Inc. (“Prudential”) and the purchasers of the Notes (as defined below), named in the Purchaser Schedule attached thereto (collectively, the “Note Purchasers”). Pursuant to the Note Purchase Agreement, on July 22, 2022, the Company issued to the Note Purchasers $125.0 million aggregate principal amount of 5.15% Series A Senior Notes Due July 22, 2034 (collectively, the "Series A Notes”). The Note Purchase Agreement also provides for the issuance of additional shelf notes from time to time issued thereunder (the “Shelf Notes” and, together with the Series A Notes, the “Notes”) not to exceed $150.0 million of Notes outstanding thereunder. The proceeds of the Notes may be used, among other things, to fund surplus at Kinsale Insurance Company, or any other insurance subsidiary of the Company, refinance indebtedness and for general corporate purposes. The Series A Notes are senior unsecured obligations of the Company and rank pari passu with the Company’s Amended and Restated Credit Agreement. Debt issuance costs of $1.9 million were incurred in connection with the issuance of the Series A Notes and have been recorded on the consolidated balance sheet within "Debt" as a contra-liability. The Note Purchase Agreement contains representations and affirmative and negative covenants, including financial covenants customary for agreements of this type, as well as customary events of default provisions. As of September 30, 2022, the Company was in compliance with all of its financial covenants under the Note Purchase Agreement. The Series A Notes bear interest at 5.15% per annum and mature on July 22, 2034, unless paid earlier by the Company. Should the Company elect to prepay the Series A Notes, such aggregate prepayment will include the applicable make-whole amount(s), as defined within the applicable Note Purchase Agreement. Principal payments are required annually beginning on July 22, 2030 in equal installments of $25.0 million through July 22, 2034. On July 25, 2022, proceeds from the Series A Notes were used to pay off outstanding loans of $43.0 million, plus accrued interest, under our Amended and Restated Credit Agreement as well as fund surplus at Kinsale Insurance Company and for general corporate purposes. Credit Agreement On July 22, 2022, the Company entered into an Amended and Restated Credit Agreement, with JPMorgan Chase Bank, N.A., as administrative agent and as issuing bank, Truist Bank, as syndication agent, and the lenders party thereto (collectively, the “Lenders”). The Amended and Restated Credit Agreement extended the maturity date to July 22, 2027, and increased the aggregate commitment to $100.0 million, with the option to increase the aggregate commitment by $30.0 million, subject to the Company obtaining commitments from existing or new lenders and satisfying other conditions specified in the Amended and Restated Credit Agreement. The Company is required to pay a Commitment Fee Rate (as defined therein) of 0.25% on the average daily amount of the Available Revolving Commitment (as defined therein). Borrowings under the Amended and Restated Credit Agreement may be used for general corporate purposes (which may include, without limitation, to fund future growth, to finance working capital needs, to fund capital expenditures, and to refinance, redeem or repay indebtedness). Debt issuance costs of $0.5 million were incurred in connection with the Amended and Restated Credit Agreement and have been recorded on the consolidated balance sheet within "Other assets." At September 30, 2022, there were no borrowings outstanding. The Amended and Restated Credit Agreement also contains representations and affirmative and negative covenants, including financial covenants customary for agreements of this type, as well as customary events of default provisions. As of September 30, 2022, the Company was in compliance with all of its financial covenants under the Credit Facility. The loans under the Amended and Restated Credit Agreement bear interest, at the Company's option, at a rate equal to the Adjusted Term SOFR Rate (as defined therein) plus 1.625% or the Alternate Base Rate (as defined therein) plus 0.625%. |
Other Comprehensive (Loss) Inco
Other Comprehensive (Loss) Income | 9 Months Ended |
Sep. 30, 2022 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Other Comprehensive Income | Other Comprehensive Loss The following table summarizes the components of other comprehensive loss for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Unrealized losses on fixed-maturity securities arising during the period, before income taxes $ (59,230) $ (6,994) $ (209,198) $ (18,162) Income tax benefit 12,439 1,469 43,932 3,814 Unrealized losses arising during the period, net of income taxes (46,791) (5,525) (165,266) (14,348) Less reclassification adjustment: Net realized (losses) gains on fixed-maturity securities, before income taxes (177) 693 250 2,232 Income tax benefit (expense) 38 (146) (52) (469) Reclassification adjustment included in net income, net of income taxes (139) 547 198 1,763 Other comprehensive loss $ (46,652) $ (6,072) $ (165,464) $ (16,111) The sale of an available-for-sale fixed-maturity security results in amounts being reclassified from accumulated other comprehensive loss to realized gains or losses in current period earnings. The related tax effect of the reclassification adjustment is recorded in income tax expense in current period earnings. See Note 2 for additional information. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of presentationThe unaudited condensed consolidated financial statements and notes have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and do not contain all of the information and footnotes required by U.S. GAAP for complete financial statements. As such, these unaudited condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements of Kinsale Capital Group, Inc. and its subsidiaries ("the Company") included in the Annual Report on Form 10-K for the year ended December 31, 2021. In the opinion of management, all adjustments necessary for a fair presentation of the condensed consolidated financial statements have been included. Such adjustments consist only of normal recurring items. 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. |
Use of Estimates | Use of estimatesThe preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, if any, at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
New Accounting Pronouncements, Policy | Prospective accounting pronouncements There are no prospective accounting standards which, upon their effective date, would have a material impact on the Company's condensed consolidated financial statements. |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Investments [Abstract] | |
Available-for-sale Investments | The following tables summarize the available-for-sale investments at September 30, 2022 and December 31, 2021: September 30, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 22,945 $ — $ (1,347) $ 21,598 Obligations of states, municipalities and political subdivisions 230,156 100 (27,589) 202,667 Corporate and other securities 795,400 73 (87,910) 707,563 Asset-backed securities 323,601 226 (8,684) 315,143 Residential mortgage-backed securities 356,947 62 (57,773) 299,236 Commercial mortgage-backed securities 65,680 — (6,040) 59,640 Total fixed-maturity investments $ 1,794,729 $ 461 $ (189,343) $ 1,605,847 December 31, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 6,936 $ — $ (89) $ 6,847 Obligations of states, municipalities and political subdivisions 216,375 12,139 (469) 228,045 Corporate and other securities 450,594 11,714 (3,821) 458,487 Asset-backed securities 299,810 2,217 (252) 301,775 Residential mortgage-backed securities 340,804 1,804 (4,923) 337,685 Commercial mortgage-backed securities 57,000 2,433 (206) 59,227 Total fixed-maturity investments $ 1,371,519 $ 30,307 $ (9,760) $ 1,392,066 |
Available-for-sale Securities in an Unrealized Loss Position | The following tables summarize gross unrealized losses and estimated fair value for available-for-sale investments by length of time that the securities have continuously been in an unrealized loss position: September 30, 2022 Less than 12 Months 12 Months or Longer Total Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses (in thousands) Fixed maturities: U.S. Treasury securities and obligations of the U.S. government agencies $ 15,457 $ (542) $ 6,141 $ (805) $ 21,598 $ (1,347) Obligations of states, municipalities and political subdivisions 169,711 (23,087) 12,935 (4,502) 182,646 (27,589) Corporate and other securities 596,026 (61,181) 94,449 (26,729) 690,475 (87,910) Asset-backed securities 269,716 (7,449) 31,305 (1,235) 301,021 (8,684) Residential mortgage-backed securities 163,761 (25,163) 133,937 (32,610) 297,698 (57,773) Commercial mortgage-backed securities 52,555 (4,659) 7,085 (1,381) 59,640 (6,040) Total fixed-maturity investments $ 1,267,226 $ (122,081) $ 285,852 $ (67,262) $ 1,553,078 $ (189,343) December 31, 2021 Less than 12 Months 12 Months or Longer Total Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses (in thousands) Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 6,847 $ (89) $ — $ — $ 6,847 $ (89) Obligations of states, municipalities and political subdivisions 23,870 (469) — — 23,870 (469) Corporate and other securities 188,522 (3,718) 1,092 (103) 189,614 (3,821) Asset-backed securities 136,669 (204) 4,452 (48) 141,121 (252) Residential mortgage-backed securities 260,251 (4,329) 17,968 (594) 278,219 (4,923) Commercial mortgage-backed securities 10,773 (206) — — 10,773 (206) Total fixed-maturity investments $ 626,932 $ (9,015) $ 23,512 $ (745) $ 650,444 $ (9,760) |
Contractual Maturities of Available-for-sale Fixed Maturity Securities | The amortized cost and estimated fair value of available-for-sale fixed-maturity securities at September 30, 2022 are summarized, by contractual maturity, as follows: September 30, 2022 Amortized Estimated Cost Fair Value (in thousands) Due in one year or less $ 14,977 $ 14,823 Due after one year through five years 531,759 506,959 Due after five years through ten years 245,305 207,332 Due after ten years 256,460 202,714 Asset-backed securities 323,601 315,143 Residential mortgage-backed securities 356,947 299,236 Commercial mortgage-backed securities 65,680 59,640 Total fixed-maturity securities $ 1,794,729 $ 1,605,847 |
Net Investment Income | The following table presents the components of net investment income for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Interest: Taxable bonds $ 12,041 $ 6,471 $ 29,015 $ 18,356 Tax exempt municipal bonds 849 874 2,558 2,636 Cash equivalents and short-term investments 475 1 598 11 Dividends on equity securities 1,085 979 3,208 2,801 Gross investment income 14,450 8,325 35,379 23,804 Investment expenses (592) (230) (1,839) (1,338) Net investment income $ 13,858 $ 8,095 $ 33,540 $ 22,466 |
Realized Gain (Loss) on Investments | The following table presents realized investment gains and losses for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Fixed-maturity securities: Realized gains $ — $ 804 $ 1,076 $ 2,445 Realized losses (177) — (720) (2) Net realized (losses) gains from fixed-maturity securities (177) 804 356 2,443 Equity securities: Realized gains — 97 1,363 97 Realized losses — (6) (148) (143) Net realized gains (losses) from equity securities — 91 1,215 (46) Realized gains (losses) from the sales of short-term investments 4 — (36) — Net realized investment (losses) gains $ (173) $ 895 $ 1,535 $ 2,397 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Assets Measured at Fair Value on a Recurring Basis | The following tables present the balances of assets measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021, by level within the fair value hierarchy: September 30, 2022 Level 1 Level 2 Level 3 Total (in thousands) Assets Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 21,598 $ — $ — $ 21,598 Obligations of states, municipalities and political subdivisions — 202,667 — 202,667 Corporate and other securities — 707,563 — 707,563 Asset-backed securities — 315,143 — 315,143 Residential mortgage-backed securities — 299,236 — 299,236 Commercial mortgage-backed securities — 59,640 — 59,640 Total fixed-maturity securities 21,598 1,584,249 — 1,605,847 Equity securities: Exchange traded funds 94,898 — — 94,898 Non-redeemable preferred stock — 38,837 — 38,837 Total equity securities 94,898 38,837 — 133,735 Short-term investments 81,056 352 — 81,408 Total $ 197,552 $ 1,623,438 $ — $ 1,820,990 December 31, 2021 Level 1 Level 2 Level 3 Total (in thousands) Assets Fixed maturities: U.S. Treasury securities and obligations of U.S. government agencies $ 6,847 $ — $ — $ 6,847 Obligations of states, municipalities and political subdivisions — 228,045 — 228,045 Corporate and other securities — 458,487 — 458,487 Asset-backed securities — 301,775 — 301,775 Residential mortgage-backed securities — 337,685 — 337,685 Commercial mortgage-backed securities — 59,227 — 59,227 Total fixed-maturity securities 6,847 1,385,219 — 1,392,066 Equity securities: Exchange traded funds 123,389 — — 123,389 Non-redeemable preferred stock — 49,222 — 49,222 Total equity securities 123,389 49,222 — 172,611 Total $ 130,236 $ 1,434,441 $ — $ 1,564,677 |
Deferred Policy Acquisition C_2
Deferred Policy Acquisition Costs (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Policy Acquisition Costs Disclosures [Abstract] | |
Deferred Policy Acquisition Costs | The following table presents the amounts of policy acquisition costs deferred and amortized for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Balance, beginning of period $ 54,806 $ 38,801 $ 41,968 $ 31,912 Policy acquisition costs deferred: Direct commissions 41,525 28,837 117,621 81,740 Ceding commissions (13,886) (8,089) (32,678) (21,283) Other underwriting and policy acquisition costs 2,302 1,600 6,534 4,540 Policy acquisition costs deferred 29,941 22,348 91,477 64,997 Amortization of net policy acquisition costs (26,302) (20,876) (75,000) (56,636) Balance, end of period $ 58,445 $ 40,273 $ 58,445 $ 40,273 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property and Equipment [Abstract] | |
Property and Equipment | Property and equipment are included in "other assets" in the accompanying consolidated balance sheets and consist of the following: September 30, 2022 December 31, 2021 (in thousands) Building $ 33,065 $ 33,101 Parking deck 5,072 5,072 Land 3,068 3,068 Equipment 3,339 3,143 Software 10,572 7,849 Furniture and fixtures 2,161 2,158 Land improvements 474 474 Construction in progress - building 1,858 — 59,609 54,865 Accumulated depreciation (7,583) (5,570) Total property and equipment, net $ 52,026 $ 49,295 |
Underwriting, Acquisition and_2
Underwriting, Acquisition and Insurance Expenses (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Underwriting, Acquisition and Insurance Expenses [Abstract] | |
Underwriting, acquisition and insurance expenses | Underwriting, acquisition and insurance expenses for the three and nine months ended September 30, 2022 and 2021 consist of the following: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Underwriting, acquisition and insurance expenses incurred: Direct commissions $ 37,177 $ 26,317 $ 99,540 $ 71,036 Ceding commissions (12,939) (6,902) (30,069) (18,344) Other operating expenses 15,907 12,050 48,191 36,798 Total $ 40,145 $ 31,465 $ 117,662 $ 89,490 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Restricted Stock Activity | A summary of restricted stock activity under the 2016 Incentive Plan for the nine months ended September 30, 2022 is as follows: For the Nine Months Ended September 30, 2022 Number of Shares Weighted Average Grant Date Fair Value per Share Non-vested outstanding at the beginning of the period 95,984 $ 131.94 Granted 52,863 $ 211.86 Vested (44,992) $ 109.76 Forfeited (4,171) $ 178.30 Non-vested outstanding at the end of the period 99,684 $ 182.40 |
Stock Options Valuation Assumptions | The value of the options granted was estimated at the date of grant using the Black-Scholes pricing model using the following assumptions: Risk-free rate of return 1.26 % Dividend yield 1.25 % Expected share price volatility (1) 18.50 % Expected life in years (2) 6.3 years |
Stock Options Activity | A summary of option activity as of September 30, 2022, and changes during the period then ended is presented below: Number of Shares Weighted-Average Exercise Price Weighted-Average Remaining Years of Contractual Term Aggregate Intrinsic Value (in thousands) Outstanding at January 1, 2022 325,433 $ 16.00 Granted — — Forfeited (934) 16.00 Exercised (56,332) 16.00 Outstanding at September 30, 2022 268,167 $ 16.00 3.6 $ 64,205 Exercisable at September 30, 2022 268,167 $ 16.00 3.6 $ 64,205 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | The following represents a reconciliation of the numerator and denominator of the basic and diluted earnings per share computations contained in the condensed consolidated financial statements: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands, except per share data) Net income $ 32,984 $ 36,625 $ 91,865 $ 104,339 Weighted average common shares outstanding - basic 22,813 22,714 22,783 22,681 Effect of potential dilutive securities: Conversion of stock options 262 317 276 329 Conversion of restricted stock 39 33 40 47 Weighted average common shares outstanding - diluted 23,114 23,064 23,099 23,057 Earnings per common share: Basic $ 1.45 $ 1.61 $ 4.03 $ 4.60 Diluted $ 1.43 $ 1.59 $ 3.98 $ 4.53 |
Reserves for Unpaid Losses an_2
Reserves for Unpaid Losses and Loss Adjustment Expenses (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Liability for Unpaid Claims and Claims Adjustment Expense, Activity in Liability [Abstract] | |
Schedule of Unpaid Losses and Loss Adjustment Expenses | The following table presents a reconciliation of consolidated beginning and ending reserves for unpaid losses and loss adjustment expenses: September 30, 2022 2021 (in thousands) Gross reserves for unpaid losses and loss adjustment expenses, beginning of year $ 881,344 $ 636,013 Less: reinsurance recoverable on unpaid losses 117,561 83,730 Net reserves for unpaid losses and loss adjustment expenses, beginning of year 763,783 552,283 Incurred losses and loss adjustment expenses: Current year 373,183 262,140 Prior years (28,850) (25,413) Total net losses and loss adjustment expenses incurred 344,333 236,727 Payments: Current year 13,028 12,110 Prior years 84,827 68,546 Total payments 97,855 80,656 Net reserves for unpaid losses and loss adjustment expenses, end of period 1,010,261 708,354 Reinsurance recoverable on unpaid losses 187,056 106,502 Gross reserves for unpaid losses and loss adjustment expenses, end of period $ 1,197,317 $ 814,856 |
Reinsurance (Tables)
Reinsurance (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Reinsurance Disclosures [Abstract] | |
Effects of Reinsurance | The following table summarizes the effect of reinsurance on premiums written and earned for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Premiums written: Direct $ 284,111 $ 197,616 $ 806,625 $ 560,553 Ceded (48,212) (26,939) (111,885) (77,825) Net written $ 235,899 $ 170,677 $ 694,740 $ 482,728 Premiums earned: Direct $ 254,855 $ 180,458 $ 682,619 $ 486,920 Ceded (45,596) (23,587) (104,640) (69,308) Net earned $ 209,259 $ 156,871 $ 577,979 $ 417,612 |
Effects of Reinsurance on Losses | The following table summarizes ceded losses and loss adjustment expenses for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Ceded incurred losses and loss adjustment expenses $ 56,774 $ 10,640 $ 79,790 $ 34,053 |
Reinsurance Recoverables | The following table presents reinsurance recoverables on paid and unpaid losses as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (in thousands) Reinsurance recoverables on paid losses $ 1,747 $ 5,409 Reinsurance recoverables on unpaid losses, net 187,056 117,561 Reinsurance recoverables, net $ 188,803 $ 122,970 |
Other Comprehensive (Loss) In_2
Other Comprehensive (Loss) Income (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Comprehensive Income (Loss) | The following table summarizes the components of other comprehensive loss for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Unrealized losses on fixed-maturity securities arising during the period, before income taxes $ (59,230) $ (6,994) $ (209,198) $ (18,162) Income tax benefit 12,439 1,469 43,932 3,814 Unrealized losses arising during the period, net of income taxes (46,791) (5,525) (165,266) (14,348) Less reclassification adjustment: Net realized (losses) gains on fixed-maturity securities, before income taxes (177) 693 250 2,232 Income tax benefit (expense) 38 (146) (52) (469) Reclassification adjustment included in net income, net of income taxes (139) 547 198 1,763 Other comprehensive loss $ (46,652) $ (6,072) $ (165,464) $ (16,111) |
Investments Investments (Availa
Investments Investments (Available for Sale) (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 1,794,729 | $ 1,371,519 |
Gross Unrealized Holding Gains | 461 | 30,307 |
Gross Unrealized Holding Losses | 189,343 | 9,760 |
Estimated Fair Value | 1,605,847 | 1,392,066 |
U.S. Treasury securities and obligations of U.S. government agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 22,945 | 6,936 |
Gross Unrealized Holding Gains | 0 | 0 |
Gross Unrealized Holding Losses | 1,347 | 89 |
Estimated Fair Value | 21,598 | 6,847 |
Obligations of states, municipalities and political subdivisions | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 230,156 | 216,375 |
Gross Unrealized Holding Gains | 100 | 12,139 |
Gross Unrealized Holding Losses | 27,589 | 469 |
Estimated Fair Value | 202,667 | 228,045 |
Corporate and other securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 795,400 | 450,594 |
Gross Unrealized Holding Gains | 73 | 11,714 |
Gross Unrealized Holding Losses | 87,910 | 3,821 |
Estimated Fair Value | 707,563 | 458,487 |
Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 323,601 | 299,810 |
Gross Unrealized Holding Gains | 226 | 2,217 |
Gross Unrealized Holding Losses | 8,684 | 252 |
Estimated Fair Value | 315,143 | 301,775 |
Residential mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 356,947 | 340,804 |
Gross Unrealized Holding Gains | 62 | 1,804 |
Gross Unrealized Holding Losses | 57,773 | 4,923 |
Estimated Fair Value | 299,236 | 337,685 |
Commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 65,680 | 57,000 |
Gross Unrealized Holding Gains | 0 | 2,433 |
Gross Unrealized Holding Losses | 6,040 | 206 |
Estimated Fair Value | $ 59,640 | $ 59,227 |
Investments Available-for-Sale
Investments Available-for-Sale Securities in a Loss Position (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 Months, Estimated Fair Value | $ 1,267,226 | $ 626,932 |
Less than 12 months, gross unrealized holding losses | 122,081 | 9,015 |
12 Months or Longer, Estimated Fair Value | 285,852 | 23,512 |
12 Months or Longer, Gross Unrealized Holding Losses | 67,262 | 745 |
Total Estimated Fair Value | 1,553,078 | 650,444 |
Total Gross Unrealized Holding Losses | 189,343 | 9,760 |
U.S. Treasury securities and obligations of U.S. government agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 Months, Estimated Fair Value | 15,457 | 6,847 |
Less than 12 months, gross unrealized holding losses | 542 | 89 |
12 Months or Longer, Estimated Fair Value | 6,141 | 0 |
12 Months or Longer, Gross Unrealized Holding Losses | 805 | 0 |
Total Estimated Fair Value | 21,598 | 6,847 |
Total Gross Unrealized Holding Losses | 1,347 | 89 |
Obligations of states, municipalities and political subdivisions [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 Months, Estimated Fair Value | 169,711 | 23,870 |
Less than 12 months, gross unrealized holding losses | 23,087 | 469 |
12 Months or Longer, Estimated Fair Value | 12,935 | 0 |
12 Months or Longer, Gross Unrealized Holding Losses | 4,502 | 0 |
Total Estimated Fair Value | 182,646 | 23,870 |
Total Gross Unrealized Holding Losses | 27,589 | 469 |
Corporate and other securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 Months, Estimated Fair Value | 596,026 | 188,522 |
Less than 12 months, gross unrealized holding losses | 61,181 | 3,718 |
12 Months or Longer, Estimated Fair Value | 94,449 | 1,092 |
12 Months or Longer, Gross Unrealized Holding Losses | 26,729 | 103 |
Total Estimated Fair Value | 690,475 | 189,614 |
Total Gross Unrealized Holding Losses | 87,910 | 3,821 |
Asset-backed securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 Months, Estimated Fair Value | 269,716 | 136,669 |
Less than 12 months, gross unrealized holding losses | 7,449 | 204 |
12 Months or Longer, Estimated Fair Value | 31,305 | 4,452 |
12 Months or Longer, Gross Unrealized Holding Losses | 1,235 | 48 |
Total Estimated Fair Value | 301,021 | 141,121 |
Total Gross Unrealized Holding Losses | 8,684 | 252 |
Residential mortgage-backed securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 Months, Estimated Fair Value | 163,761 | 260,251 |
Less than 12 months, gross unrealized holding losses | 25,163 | 4,329 |
12 Months or Longer, Estimated Fair Value | 133,937 | 17,968 |
12 Months or Longer, Gross Unrealized Holding Losses | 32,610 | 594 |
Total Estimated Fair Value | 297,698 | 278,219 |
Total Gross Unrealized Holding Losses | 57,773 | 4,923 |
Commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 Months, Estimated Fair Value | 52,555 | 10,773 |
Less than 12 months, gross unrealized holding losses | 4,659 | 206 |
12 Months or Longer, Estimated Fair Value | 7,085 | 0 |
12 Months or Longer, Gross Unrealized Holding Losses | 1,381 | 0 |
Total Estimated Fair Value | 59,640 | 10,773 |
Total Gross Unrealized Holding Losses | $ 6,040 | $ 206 |
Investments Available-for-Sal_2
Investments Available-for-Sale Securities in a Loss Position Narrative (Details) $ in Thousands | Sep. 30, 2022 USD ($) Rate | Dec. 31, 2021 USD ($) |
Debt Securities, Available-for-sale [Line Items] | ||
Number of available-for-sale securities in unrealized loss positions | 984 | |
Total Estimated Fair Value | $ 1,553,078 | $ 650,444 |
Gross Unrealized Losses | $ 189,343 | $ 9,760 |
Number of available-for-sale securities in unrealized loss positions, greater than one year | 130 | |
Credit losses | $ 0 | |
Fixed maturities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale securities, percentage of securities with ratings of A minus or better | Rate | 79.80% |
Investments Contractual Maturit
Investments Contractual Maturities of Available-for-Sale Fixed Maturity Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Amortized Cost | ||
Due in one year or less, Amortized Cost | $ 14,977 | |
Due after one year through five years, Amortized Cost | 531,759 | |
Due after five years through ten years, Amortized Cost | 245,305 | |
Due after ten years, Amortized Cost | 256,460 | |
Total fixed maturities, Amortized Cost | 1,794,729 | $ 1,371,519 |
Estimated Fair Value | ||
Due in one year or less, Estimated Fair Value | 14,823 | |
Due after one year through five years, Estimated Fair Value | 506,959 | |
Due after five years through ten years, Estimated Fair Value | 207,332 | |
Due after ten years, Estimated Fair Value | 202,714 | |
Estimated Fair Value | 1,605,847 | 1,392,066 |
Asset-backed securities [Member] | ||
Amortized Cost | ||
Without single maturity date, Amortized Cost | 323,601 | |
Total fixed maturities, Amortized Cost | 323,601 | 299,810 |
Estimated Fair Value | ||
Without single maturity date, Estimated Fair Value | 315,143 | |
Estimated Fair Value | 315,143 | 301,775 |
Residential mortgage-backed securities [Member] | ||
Amortized Cost | ||
Without single maturity date, Amortized Cost | 356,947 | |
Total fixed maturities, Amortized Cost | 356,947 | 340,804 |
Estimated Fair Value | ||
Without single maturity date, Estimated Fair Value | 299,236 | |
Estimated Fair Value | 299,236 | 337,685 |
Commercial mortgage-backed securities | ||
Amortized Cost | ||
Without single maturity date, Amortized Cost | 65,680 | |
Total fixed maturities, Amortized Cost | 65,680 | 57,000 |
Estimated Fair Value | ||
Without single maturity date, Estimated Fair Value | 59,640 | |
Estimated Fair Value | $ 59,640 | $ 59,227 |
Investments Net Investment Inco
Investments Net Investment Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Components of Net Investment Income [Abstract] | ||||
Taxable bonds | $ 12,041 | $ 6,471 | $ 29,015 | $ 18,356 |
Tax exempt municipal bonds | 849 | 874 | 2,558 | 2,636 |
Cash equivalents and short-term investments | 475 | 1 | 598 | 11 |
Dividends on equity securities | 1,085 | 979 | 3,208 | 2,801 |
Gross investment income | 14,450 | 8,325 | 35,379 | 23,804 |
Investment expenses | (592) | (230) | (1,839) | (1,338) |
Net investment income | $ 13,858 | $ 8,095 | $ 33,540 | $ 22,466 |
Investments Realized Gains (Los
Investments Realized Gains (Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Debt and Equity Securities, Realized Gain (Loss) [Abstract] | ||||
Realized gains, fixed-maturity securities | $ 0 | $ 804 | $ 1,076 | $ 2,445 |
Realized losses, fixed-maturity securities | (177) | 0 | (720) | (2) |
Net realized gains, fixed-maturity securities | (177) | 804 | 356 | 2,443 |
Realized gains, equity securities | 0 | 97 | 1,363 | 97 |
Realized losses, equity securities | 0 | (6) | (148) | (143) |
Net realized gains (losses), equity securities | 0 | 91 | 1,215 | (46) |
Realized losses from sale of short-term investments | 4 | 0 | (36) | 0 |
Net realized investment gains | $ (173) | $ 895 | $ 1,535 | $ 2,397 |
Investments Unrealized Gains (L
Investments Unrealized Gains (Losses) on Investments (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Change in net unrealized gains on fixed-maturity securities | $ (59.1) | $ (7.7) | $ (209.4) | $ (20.4) |
Investments Investment Narrativ
Investments Investment Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Investments, Debt and Equity Securities [Abstract] | ||
Assets on deposit with state regulatory authorities | $ 6.3 | $ 6.7 |
Payable for investments purchased | $ 3.9 | $ 15 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Hierarchy (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | $ 1,605,847 | $ 1,392,066 |
U.S. Treasury securities and obligations of U.S. government agencies | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 21,598 | 6,847 |
Obligations of states, municipalities and political subdivisions [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 202,667 | 228,045 |
Corporate and other securities [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 707,563 | 458,487 |
Asset-backed securities [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 315,143 | 301,775 |
Residential mortgage-backed securities [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 299,236 | 337,685 |
Commercial mortgage-backed securities | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 59,640 | 59,227 |
Recurring | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 1,820,990 | 1,564,677 |
Recurring | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 197,552 | 130,236 |
Recurring | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 1,623,438 | 1,434,441 |
Recurring | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 0 | 0 |
Recurring | Fixed maturities [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 1,605,847 | 1,392,066 |
Recurring | Fixed maturities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 21,598 | 6,847 |
Recurring | Fixed maturities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 1,584,249 | 1,385,219 |
Recurring | Fixed maturities [Member] | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | U.S. Treasury securities and obligations of U.S. government agencies | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 21,598 | 6,847 |
Recurring | U.S. Treasury securities and obligations of U.S. government agencies | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 21,598 | 6,847 |
Recurring | U.S. Treasury securities and obligations of U.S. government agencies | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | U.S. Treasury securities and obligations of U.S. government agencies | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Obligations of states, municipalities and political subdivisions [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 202,667 | 228,045 |
Recurring | Obligations of states, municipalities and political subdivisions [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Obligations of states, municipalities and political subdivisions [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 202,667 | 228,045 |
Recurring | Obligations of states, municipalities and political subdivisions [Member] | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Corporate and other securities [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 707,563 | 458,487 |
Recurring | Corporate and other securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Corporate and other securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 707,563 | 458,487 |
Recurring | Corporate and other securities [Member] | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Asset-backed securities [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 315,143 | 301,775 |
Recurring | Asset-backed securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Asset-backed securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 315,143 | 301,775 |
Recurring | Asset-backed securities [Member] | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Residential mortgage-backed securities [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 299,236 | 337,685 |
Recurring | Residential mortgage-backed securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Residential mortgage-backed securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 299,236 | 337,685 |
Recurring | Residential mortgage-backed securities [Member] | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Commercial mortgage-backed securities | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 59,640 | 59,227 |
Recurring | Commercial mortgage-backed securities | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Commercial mortgage-backed securities | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 59,640 | 59,227 |
Recurring | Commercial mortgage-backed securities | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fixed-maturity securities, available for sale, at fair value (amortized cost: $1,794,729 – 2022; $1,371,519 – 2021) | 0 | 0 |
Recurring | Equity securities [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 133,735 | 172,611 |
Recurring | Equity securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 94,898 | 123,389 |
Recurring | Equity securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 38,837 | 49,222 |
Recurring | Equity securities [Member] | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 0 | 0 |
Recurring | Exchange traded funds [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 94,898 | 123,389 |
Recurring | Exchange traded funds [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 94,898 | 123,389 |
Recurring | Exchange traded funds [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 0 | 0 |
Recurring | Exchange traded funds [Member] | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 0 | 0 |
Recurring | Nonredeemable preferred stock [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 38,837 | 49,222 |
Recurring | Nonredeemable preferred stock [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 0 | 0 |
Recurring | Nonredeemable preferred stock [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 38,837 | 49,222 |
Recurring | Nonredeemable preferred stock [Member] | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 0 | $ 0 |
Recurring | Short-term Investments | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 81,408 | |
Recurring | Short-term Investments | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 81,056 | |
Recurring | Short-term Investments | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | 352 | |
Recurring | Short-term Investments | Level 3 | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Fair value | $ 0 |
Fair Value Measures and Disclos
Fair Value Measures and Disclosures Narrative (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | $ 24,900 | $ 44,700 |
Nonrecurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 0 | 0 |
Liabilities measured at fair value | 0 | $ 0 |
Reported Value Measurement | 2034 Series A Notes | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Long-Term Debt, Fair Value | 125,000 | |
Estimate of Fair Value Measurement | 2034 Series A Notes | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Long-Term Debt, Fair Value | 115,100 | |
Estimate of Fair Value Measurement | Line of Credit | ||
Fair Value of Investments Measured on Recurring Basis [Line Items] | ||
Long-Term Debt, Fair Value | $ 0 |
Deferred Policy Acquisition C_3
Deferred Policy Acquisition Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Movement Analysis of Deferred Policy Acquisition Costs [Roll Forward] | ||||
Balance, beginning of period | $ 54,806 | $ 38,801 | $ 41,968 | $ 31,912 |
Policy acquisition costs deferred: | ||||
Direct commissions deferred | 41,525 | 28,837 | 117,621 | 81,740 |
Ceding commissions deferred | (13,886) | (8,089) | (32,678) | (21,283) |
Other underwriting and policy acquisition costs | 2,302 | 1,600 | 6,534 | 4,540 |
Policy acquisition costs deferred | 29,941 | 22,348 | 91,477 | 64,997 |
Amortization of net policy acquisition costs | (26,302) | (20,876) | (75,000) | (56,636) |
Balance, end of period | $ 58,445 | $ 40,273 | $ 58,445 | $ 40,273 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 59,609 | $ 54,865 |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (7,583) | (5,570) |
Property, Plant and Equipment, Net | 52,026 | 49,295 |
Building | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 33,065 | 33,101 |
Parking | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 5,072 | 5,072 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 3,068 | 3,068 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 3,339 | 3,143 |
Software Development | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 10,572 | 7,849 |
Furniture and Fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 2,161 | 2,158 |
Land Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 474 | 474 |
Construction in Progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 1,858 | $ 0 |
Underwriting, Acquisition and_3
Underwriting, Acquisition and Insurance Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Underwriting, Acquisition and Insurance Expenses [Abstract] | ||||
Gross commissions | $ 37,177 | $ 26,317 | $ 99,540 | $ 71,036 |
Ceding commissions | (12,939) | (6,902) | (30,069) | (18,344) |
Other operating expenses | 15,907 | 12,050 | 48,191 | 36,798 |
Underwriting, acquisition, and insurance expenses | 40,145 | 31,465 | 117,662 | 89,490 |
Salaries, bonuses and employee benefits | $ 15,400 | $ 11,600 | $ 46,100 | $ 34,900 |
Stock-based Compensation Narrat
Stock-based Compensation Narrative (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 5 | $ 3.6 |
Maximum [Member] | 2016 Omnibus Incentive Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares available for issuance | 2,073,832 |
Stock-based Compensation Narr_2
Stock-based Compensation Narrative - Restricted Stock Awards (Details) - Restricted stock [Member] - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average grant date fair value | $ 211.86 | $ 185 |
Fair value of restricted stock awards vested | $ 9.9 | $ 6.8 |
Unrecognized stock-based compensation expense | $ 14.6 | |
Compensation cost not yet recognized, period | 2 years 9 months 18 days | |
Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 1 year | |
Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 4 years |
Stock-based Compensation Restri
Stock-based Compensation Restrictive Stock Awards (Details) - $ / shares | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Nonvested Restricted Stock, Weighted Average Grant Date Fair Value [Abstract] | |||||
Restricted shares withheld for taxes (shares) | 12,000 | 2,000 | 13,000 | ||
Restricted stock [Member] | |||||
Nonvested Restricted Stock, Number of Shares [Roll Forward] | |||||
Nonvested outstanding at the beginning of the period, shares | 95,984 | 95,984 | |||
Granted, shares | 52,863 | ||||
Vested, shares | (44,992) | ||||
Forfeited, shares | (4,171) | ||||
Nonvested outstanding at the end of the period, shares | 99,684 | ||||
Nonvested Restricted Stock, Weighted Average Grant Date Fair Value [Abstract] | |||||
Nonvested outstanding at the beginning of the period | $ 131.94 | $ 131.94 | |||
Granted | 211.86 | $ 185 | |||
Vested | 109.76 | ||||
Forfeited | 178.30 | ||||
Nonvested outstanding at the end of the period | $ 182.40 | ||||
Restricted shares withheld for taxes (shares) | 14,879 |
Stock-based Compensation Narr_3
Stock-based Compensation Narrative - Stock Options (Details) - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | ||
Jul. 27, 2016 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Intrinsic value of options exercised | $ 12.2 | $ 7.3 | |
Weighted average exercise price, granted | $ 0 | ||
Stock option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average exercise price, granted | $ 16 | ||
Weighted average grant date fair value | $ 2.71 | ||
Contractual term | 10 years | ||
Vesting period | 4 years |
Stock-based Compensation Stock
Stock-based Compensation Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Jul. 27, 2016 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding beginning of period, shares | 325,433 | |
Granted, shares | 0 | |
Forfeited, shares | (934) | |
Exercised, shares | (56,332) | |
Outstanding end of period, shares | 268,167 | |
Exercisable, shares | 268,167 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Outstanding beginning of period | $ 16 | |
Granted | 0 | |
Forfeited | 16 | |
Exercised | 16 | |
Outstanding end of period | 16 | |
Exercisable end of period | $ 16 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Outstanding, weighted average remaining contractual term | 3 years 7 months 6 days | |
Exercisable, weighted average remaining contractual term | 3 years 7 months 6 days | |
Outstanding, aggregate intrinsic value | $ 64,205 | |
Exercisable, aggregate intrinsic value | $ 64,205 | |
Stock option [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | ||
Risk-free rate of return | 1.26% | |
Dividend yield | 1.25% | |
Expected share price volatility | 18.50% | |
Expected life in years | 6 years 3 months 18 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Granted, shares | 1,036,916 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Granted | $ 16 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Earnings Per Share, [Line Items] | ||||||||
Net income | $ 32,984 | $ 27,090 | $ 31,791 | $ 36,625 | $ 35,635 | $ 32,079 | $ 91,865 | $ 104,339 |
Weighted Average Number of Shares Outstanding, Basic [Abstract] | ||||||||
Weighted average shares outstanding - basic | 22,813 | 22,714 | 22,783 | 22,681 | ||||
Weighted Average Number of Shares Outstanding, Diluted [Abstract] | ||||||||
Weighted average shares outstanding - diluted | 23,114 | 23,064 | 23,099 | 23,057 | ||||
Earnings Per Share, Basic [Abstract] | ||||||||
Earnings per share - basic | $ 1.45 | $ 1.61 | $ 4.03 | $ 4.60 | ||||
Earnings Per Share, Diluted [Abstract] | ||||||||
Earnings per share - diluted | $ 1.43 | $ 1.59 | $ 3.98 | $ 4.53 | ||||
Stock option [Member] | ||||||||
Incremental Weighted Average Shares Attributable to Dilutive Effect [Abstract] | ||||||||
Dilutive effect of shares issued under stock compensation arrangements | 262 | 317 | 276 | 329 | ||||
Restricted stock [Member] | ||||||||
Incremental Weighted Average Shares Attributable to Dilutive Effect [Abstract] | ||||||||
Dilutive effect of shares issued under stock compensation arrangements | 39 | 33 | 40 | 47 |
Earnings Per Share Narrative (D
Earnings Per Share Narrative (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Restricted stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities | 0 | 0 | 48,000 | 30,000 |
Income Taxes (Details)
Income Taxes (Details) | 9 Months Ended | |
Sep. 30, 2022 Rate | Sep. 30, 2021 Rate | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | 17.50% | 18.90% |
Federal statutory income tax rate | 21% | 21% |
Reserves for Unpaid Losses an_3
Reserves for Unpaid Losses and Loss Adjustment Expenses (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||||
Gross reserves for unpaid losses and loss adjustment expenses, beginning of year | $ 881,344 | $ 636,013 | ||
Reinsurance recoverable on unpaid losses | 187,056 | 106,502 | $ 117,561 | $ 83,730 |
Net reserves for unpaid losses and loss adjustment expenses, beginning of year | 763,783 | 552,283 | ||
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||||
Current year | 373,183 | 262,140 | ||
Prior years | (28,850) | (25,413) | ||
Total net losses and loss adjustment expenses incurred | 344,333 | 236,727 | ||
Payments: | ||||
Current year | 13,028 | 12,110 | ||
Prior years | 84,827 | 68,546 | ||
Total payments | 97,855 | 80,656 | ||
Reinsurance recoverable on unpaid losses | 187,056 | 106,502 | $ 117,561 | $ 83,730 |
Net reserves for unpaid losses and loss adjustment expenses, end of period | 1,010,261 | 708,354 | ||
Gross reserves for unpaid losses and loss adjustment expenses, end of period | $ 1,197,317 | $ 814,856 |
Reserves for Unpaid Losses an_4
Reserves for Unpaid Losses and Loss Adjustment Expenses Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Claims Development [Line Items] | ||
Adverse (Favorable) development on prior year loss reserves | $ (28,850) | $ (25,413) |
Current year | 373,183 | 262,140 |
Catastrophe losses [Member] | ||
Claims Development [Line Items] | ||
Current year | 26,200 | 8,800 |
Accident Years 2021 and 2020 | ||
Claims Development [Line Items] | ||
Adverse (Favorable) development on prior year loss reserves | $ (32,000) | |
Accident Year 2020 | ||
Claims Development [Line Items] | ||
Adverse (Favorable) development on prior year loss reserves | $ (28,900) |
Reinsurance (Details)
Reinsurance (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Premiums Written, Net [Abstract] | ||||||
Premiums written - direct | $ 284,111 | $ 197,616 | $ 806,625 | $ 560,553 | ||
Premiums written - ceded | (48,212) | (26,939) | (111,885) | (77,825) | ||
Net written premiums | 235,899 | 170,677 | 694,740 | 482,728 | ||
Premiums Earned, Net [Abstract] | ||||||
Premiums earned - direct | 254,855 | 180,458 | 682,619 | 486,920 | ||
Premiums earned - ceded | (45,596) | (23,587) | (104,640) | (69,308) | ||
Net earned premiums | 209,259 | 156,871 | 577,979 | 417,612 | ||
Ceded incurred losses and loss adjustment expenses | 56,774 | 10,640 | 79,790 | 34,053 | ||
Reinsurance recoverables on paid losses | 1,747 | 1,747 | $ 5,409 | |||
Reinsurance recoverable on unpaid losses | 187,056 | $ 106,502 | 187,056 | $ 106,502 | 117,561 | $ 83,730 |
Reinsurance recoverables, net | $ 188,803 | $ 188,803 | $ 122,970 |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||
Maturity Date | Jul. 22, 2027 | ||
Current Borrowing Capacity | $ 100,000 | ||
Credit Facility Accordion Feature | $ 30,000 | ||
Line of Credit Facility, Commitment Fee Percentage | 0.25% | ||
Interest Rate Description | The loans under the Amended and Restated Credit Agreement bear interest, at the Company's option, at a rate equal to the Adjusted Term SOFR Rate (as defined therein) plus 1.625% or the Alternate Base Rate (as defined therein) plus 0.625%. | ||
Repayments of Long-Term Lines of Credit | $ 43,000 | $ 0 | |
Credit facility | 0 | $ 42,696 | |
Line of Credit | |||
Debt Instrument [Line Items] | |||
Debt Issuance Costs, Gross | $ 500 | ||
2034 Series A Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Issuance Date | Jul. 22, 2022 | ||
Debt Instrument, Face Amount | $ 125,000 | ||
Debt instrument borrowing capacity | 150,000 | ||
Debt Issuance Costs, Gross | $ 1,900 | ||
Debt Instrument, Interest Rate, Stated Percentage | 5.15% | ||
Debt Instrument, Maturity Date | Jul. 22, 2034 | ||
Debt Instrument, Date of First Required Payment | Jul. 22, 2030 | ||
Debt Instrument, Periodic Payment, Principal | $ 25,000 |
Other Comprehensive (Loss) In_3
Other Comprehensive (Loss) Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||||||
Unrealized (losses) gains arising during the period, before income taxes | $ (59,230) | $ (6,994) | $ (209,198) | $ (18,162) | ||||
Income taxes | 12,439 | 1,469 | 43,932 | 3,814 | ||||
Unrealized (losses) gains arising during the period, net of income tax | (46,791) | (5,525) | (165,266) | (14,348) | ||||
Less reclassification adjustment [Abstract] | ||||||||
Net realized investment gains on fixed-maturity securities, before income taxes | (177) | 693 | 250 | 2,232 | ||||
Income taxes | 38 | (146) | (52) | (469) | ||||
Reclassification adjustment included in net income, net of income taxes | (139) | 547 | 198 | 1,763 | ||||
Other comprehensive loss | $ (46,652) | $ (54,882) | $ (63,930) | $ (6,072) | $ 9,583 | $ (19,622) | $ (165,464) | $ (16,111) |