Variable Interest Entity

3 Months Ended

Mar. 31, 2024

Variable Interest Entity, Measure of Activity [Abstract]

Note 13 -- Variable Interest Entity

CORE, a Florida-domiciled reciprocal insurance exchange, is owned by its policyholders, referred to as subscribers, and was organized to offer commercial residential multiple peril and wind insurance products. Each subscriber owns part of CORE by buying an insurance policy and making a surplus contribution. CORE is managed by CRM, an AIF company which is a wholly-owned subsidiary of HCI. At the formation date of CORE, management determined that CORE is a variable interest entity (“VIE”).

Since HCI has the power to direct the activities of CORE that most significantly affect CORE’s economic performance and the obligation to absorb losses or the right to receive benefits from CORE via the subordinated surplus note and the management and service agreements, HCI is considered the primary beneficiary of CORE and is required to consolidate CORE. As HCI has no equity at risk, CORE’s equity and results of operations are included in noncontrolling interests.

CORE’s assets are legally restricted for the purpose of fulfilling obligations specific to CORE. The creditors of CORE have no legal right to pursue additional sources of payment from the Company. The following table summarizes the assets and liabilities related to CORE, a consolidated VIE, which are included in the accompanying consolidated balance sheets:


	March 31,		December 31,
	2024		2023
Assets:
Cash and cash equivalents	$	44,411	$	24,635
Restricted cash		302		300
Income taxes receivable		651		—
Other assets		270		65
Total assets	$	45,634	$	25,000
Liabilities:
Losses and loss adjustment expenses	$	1,178	$	—
Unearned premiums		15,862		—
Ceded reinsurance premiums payable		1,986		—
Assumed premiums payable		236		—
Deferred income taxes, net		342		—
Other liabilities		183		—
Total liabilities	$	19,787	$	—