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Segment Information (Tables)
 9 Months Ended
Sep. 30, 2023
Segment Reporting [Abstract]  
Schedule of Segment Reporting Information, by Segment The tabular information that follows shows the financial results of the Company's reportable segments reconciled to results reflected in the Condensed Consolidated Statements of Income and Comprehensive Income. ProAssurance does not consider goodwill or intangible asset impairments, changes in the fair value of contingent consideration or transaction-related costs for completed business combinations, including any related tax impacts, in assessing the financial performance of its operating and reportable segments, and thus are included in the reconciliation of segment results to consolidated results.
Financial results by segment were as follows:
Three Months Ended September 30, 2023
(In thousands)Specialty P&CWorkers' Compensation InsuranceSegregated Portfolio Cell ReinsuranceCorporateInter-segment EliminationsConsolidated
Net premiums earned$195,772 $39,885 $6,763 $— $— $242,420 
Net investment income— — 601 32,153 — 32,754 
Equity in earnings (loss) of unconsolidated subsidiaries— — — (61)— (61)
Net investment gains (losses)— — (525)(3,677)— (4,202)
Other income (expense)(1)
1,089 333 2 2,847 (935)3,336 
Net losses and loss adjustment expenses(162,677)(41,208)(5,006)— — (208,891)
Underwriting, policy acquisition and operating expenses(1)
(49,395)(13,542)(3,668)(8,344)935 (74,014)
SPC U.S. federal income tax benefit (expense)(2)
— — 175 — — 175 
SPC dividend (expense) income— — 2,518 — — 2,518 
Interest expense— — — (5,514)— (5,514)
Income tax benefit (expense)— — — 4,655 — 4,655 
Segment results$(15,211)$(14,532)$860 $22,059 $— (6,824)
Reconciliation of segments to consolidated results:
Goodwill impairment
(44,110)
Contingent Consideration Adjustment(3)
1,500 
Net income (loss)$(49,434)
Significant non-cash items:
Depreciation and amortization, net of accretion$2,728 $851 $300 $2,575 $— $6,454 
Goodwill impairment
$— $— $— $— $— $44,110 
Nine Months Ended September 30, 2023
(In thousands)Specialty P&CWorkers' Compensation InsuranceSegregated Portfolio Cell Reinsurance CorporateInter-segment EliminationsConsolidated
Net premiums earned
$562,206 $121,706 $46,156 $— $— $730,068 
Net investment income
— — 1,625 93,089 — 94,714 
Equity in earnings (loss) of unconsolidated subsidiaries
— — — 5,450 — 5,450 
Net investment gains (losses)— — 1,830 (3,174)— (1,344)
Other income (expense)(1)
3,106 1,565 3 5,347 (3,157)6,864 
Net losses and loss adjustment expenses(476,187)(101,813)(27,245)— — (605,245)
Underwriting, policy acquisition and operating expenses(1)
(140,949)(40,923)(15,241)(24,823)3,157 (218,779)
SPC U.S. federal income tax benefit (expense)(2)
— — (1,351)— — (1,351)
SPC dividend (expense) income
— — (3,171)— — (3,171)
Interest expense
— — — (16,478)— (16,478)
Income tax benefit (expense)
— — — 3,901 — 3,901 
Segment results
$(51,824)$(19,465)$2,606 $63,312 $— (5,371)
Reconciliation of segments to consolidated results:
Goodwill impairment
(44,110)
Contingent Consideration Adjustment(3)
4,500 
Net income (loss)$(44,981)
Significant non-cash items:
Depreciation and amortization, net of accretion$7,927 $2,573 $(187)$9,772 $— $20,085 
Goodwill impairment
$— $— $— $— $— $44,110 
Three Months Ended September 30, 2022
(In thousands)Specialty P&CWorkers' Compensation InsuranceSegregated Portfolio Cell Reinsurance CorporateInter-segment EliminationsConsolidated
Net premiums earned$198,481 $42,063 $17,811 $— $— $258,355 
Net investment income— — 294 24,451 — 24,745 
Equity in earnings (loss) of unconsolidated subsidiaries— — — (6,852)— (6,852)
Net investment gains (losses)— — (732)(7,530)— (8,262)
Other income (expense)(1)
1,000 554 1 4,695 (1,153)5,097 
Net losses and loss adjustment expenses(158,518)(28,148)(11,407)— — (198,073)
Underwriting, policy acquisition and operating expenses(1)
(53,166)(14,146)(5,599)(8,921)1,153 (80,679)
SPC U.S. federal income tax benefit (expense)(2)
— — (433)— — (433)
SPC dividend (expense) income— — (183)— — (183)
Interest expense— — — (5,513)— (5,513)
Income tax benefit (expense)— — — 2,673 — 2,673 
Segment results$(12,203)$323 $(248)$3,003 $— (9,125)
Net income (loss)$(9,125)
Significant non-cash items:
Depreciation and amortization, net of accretion$2,290 $872 $294 $6,181 $— $9,637 
Nine Months Ended September 30, 2022
(In thousands)Specialty P&CWorkers' Compensation InsuranceSegregated Portfolio Cell Reinsurance CorporateInter-segment EliminationsConsolidated
Net premiums earned$593,534 $124,456 $53,347 $— $— $771,337 
Net investment income— — 617 66,515 — 67,132 
Equity in earnings (loss) of unconsolidated subsidiaries— — — 5,948 — 5,948 
Net investment gains (losses)— — (4,225)(41,427)— (45,652)
Other income (expense)(1)
4,185 1,753 2 10,386 (3,111)13,215 
Net losses and loss adjustment expenses
(469,690)(83,306)(32,170)— — (585,166)
Underwriting, policy acquisition and operating expenses(1)
(148,339)(40,816)(15,203)(26,679)3,111 (227,926)
SPC U.S. federal income tax benefit (expense)(2)
— — (1,424)— — (1,424)
SPC dividend (expense) income
— — (1,697)— — (1,697)
Interest expense
— — — (14,872)— (14,872)
Income tax benefit (expense)
— — — 6,232 — 6,232 
Segment results
$(20,310)$2,087 $(753)$6,103 $— (12,873)
Reconciliation of segments to consolidated results:
Transaction-related costs(4)
(1,471)
Net income (loss)$(14,344)
Significant non-cash items:
Depreciation and amortization, net of accretion$7,830 $2,620 $1,009 $18,587 $— $30,046 
(1) Includes certain fees for services provided by the Workers' Compensation Insurance segment to the SPCs at Inova Re and Eastern Re which are recorded as expenses within the Segregated Portfolio Cell Reinsurance segment and as other income within the Workers' Compensation Insurance segment. These fees are primarily SPC rental fees and are eliminated between segments in consolidation.
(2) Represents the provision for U.S. federal income taxes for SPCs at Inova Re, which have elected to be taxed as a U.S. corporation under Section 953(d) of the Internal Revenue Code. U.S. federal income taxes are included in the total SPC net results and are paid by the individual SPCs.
(3) Represents the change in the fair value of contingent consideration issued in connection with the NORCAL acquisition included as a component of consolidated net investment gains (losses) on the Condensed Consolidated Statements of Income and Comprehensive Income. See further discussion on the contingent consideration in Note 2.
(4) Represents the transaction-related costs, after-tax, associated with the acquisition of NORCAL. For the nine months ended September 30, 2022 pre-tax transaction-related costs of approximately $1.9 million were included as a component of consolidated operating expense and the associated income tax benefit of approximately $0.4 million were included as a component of consolidated income tax benefit (expense) on the Condensed Consolidated Statements of Income and Comprehensive Income.
Schedule of Gross Premiums by Product
The following table provides detailed information regarding ProAssurance's gross premiums earned by product as well as a reconciliation to net premiums earned. All gross premiums earned are from external customers except as noted. ProAssurance's insured risks are primarily within the U.S.
Three Months Ended September 30Nine Months Ended September 30
(In thousands)2023202220232022
Specialty P&C Segment
Gross premiums earned:
HCPL$163,343 $172,984 $494,658 $514,027 
Small Business Unit
26,508 27,681 78,513 80,407 
Medical Technology Liability
10,904 10,911 32,060 30,879 
Lloyd's Syndicates
4,931 6,608 14,499 22,283 
Other— 206 — 603 
Ceded premiums earned(9,914)(19,909)(57,524)(54,665)
Segment net premiums earned195,772 198,481 562,206 593,534 
Workers' Compensation Insurance Segment
Gross premiums earned:
Traditional business43,423 45,680 131,623 134,231 
Alternative market business
17,311 18,283 52,421 54,287 
Ceded premiums earned(20,849)(21,900)(62,338)(64,062)
Segment net premiums earned39,885 42,063 121,706 124,456 
Segregated Portfolio Cell Reinsurance Segment
Gross premiums earned:
Workers' compensation(1)
15,979 17,034 48,613 51,304 
HCPL(2)
(6,971)3,161 4,388 9,151 
Ceded premiums earned(2,245)(2,384)(6,845)(7,108)
Segment net premiums earned6,763 17,811 46,156 53,347 
Consolidated net premiums earned$242,420 $258,355 $730,068 $771,337 
(1) Premium for all periods is assumed from the Workers' Compensation Insurance segment.
(2) Premium for all periods is assumed from the Specialty P&C segment.