Reinsurance

12 Months Ended

Dec. 31, 2025

Reinsurance

Reinsurance

11. Reinsurance

The Company cedes insurance to CAR and to other reinsurers. The Company has various excess of loss and quota share agreements that qualify as reinsurance treaties and are designed to protect against large or unusual loss and LAE activity. Reinsurance contracts do not relieve the Company from its obligations to policyholders. Failure of reinsurers to honor their obligations could result in losses to the Company. The Company evaluates the financial condition of its reinsurers and monitors economic characteristics of the reinsurers to minimize its exposure to significant losses from reinsurer insolvencies.

The Company is subject to concentration of credit risk with respect to reinsurance ceded. At December 31, 2025, reinsurance receivables on paid and unpaid loss and LAE with a carrying value of $151,259 and ceded unearned premiums of $36,393 were associated with CAR. At December 31, 2024, reinsurance receivables on paid and unpaid loss and LAE with a carrying value of $145,927 and ceded unearned premiums of $38,335 were associated with CAR. The Company assumes a proportionate share of the obligations from CAR. The Company makes an estimate of its share

of assumed activity from the most recent quarter reported by CAR and records adjustments to the reported activity to reflect its anticipated final assumed obligations. The Company’s participation in CAR resulted in assumed net income (loss) of $(2,967), $2,738 and $100 for the years ended December 31, 2025, 2024 and 2023, respectively.

CAR has been, with few exceptions, required by law to issue a policy to any applicant who seeks it. As a servicing carrier of CAR, this requirement has applied to the Company.

The effect of assumed and ceded premiums on net written and earned premiums and losses and LAE incurred is as follows.

	Years Ended December 31,
	2025		2024		2023
Written Premiums
Direct	$	1,278,605	$	1,193,057	$	991,224
Assumed		23,765		20,279		30,850
Ceded		(126,733)		(119,931)		(96,779)
Net written premiums	$	1,175,637	$	1,093,405	$	925,295
Earned Premiums
Direct	$	1,244,722	$	1,102,695	$	897,598
Assumed		22,760		18,874		29,702
Ceded		(128,471)		(110,865)		(92,886)
Net earned premiums	$	1,139,011	$	1,010,704	$	834,414
Loss and LAE
Direct	$	861,713	$	786,819	$	691,768
Assumed		16,272		11,136		23,706
Ceded		(80,803)		(81,318)		(73,172)
Net loss and LAE	$	797,182	$	716,637	$	642,302