(State or Other Jurisdiction of Incorporation or Organization) | (IRS Employer Identification Number) |
| |||||||||||||||||
(Address of Principle Executive Offices) | (Zip Code) |
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | ||||||
Large accelerated filer | ☐ | Accelerated filer | ☐ | Emerging growth company | |||||||||||||
☑ | Smaller reporting company |
PART I. FINANCIAL INFORMATION | ||||||||
Item 1. Financial Statements | ||||||||
Condensed Consolidated Balance Sheets (Unaudited) | ||||||||
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) | ||||||||
Condensed Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) | ||||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) | ||||||||
Notes to Unaudited Condensed Consolidated Financial Statements | ||||||||
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations | ||||||||
Item 3. Quantitative and Qualitative Disclosures About Market Risk | ||||||||
Item 4. Controls and Procedures | ||||||||
PART II. OTHER INFORMATION | ||||||||
Item 1. Legal Proceedings | ||||||||
Item 1A. Risk Factors | ||||||||
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | ||||||||
Item 3. Defaults Upon Senior Securities | ||||||||
Item 4. Mine Safety Disclosures | ||||||||
Item 5. Other Information | ||||||||
Item 6. Exhibits | ||||||||
Signatures |
June 30, 2023 | December 31, 2022 | |||||||||||||
ASSETS | ||||||||||||||
Investments, at fair value: | ||||||||||||||
Fixed maturities, available-for-sale (amortized cost of $ | $ | $ | ||||||||||||
Equity securities | ||||||||||||||
Other investments (amortized cost of $ | ||||||||||||||
Total investments | $ | $ | ||||||||||||
Cash and cash equivalents | ||||||||||||||
Restricted cash | ||||||||||||||
Total cash, cash equivalents and restricted cash | $ | $ | ||||||||||||
Accrued investment income | ||||||||||||||
Property and equipment, net | ||||||||||||||
Premiums receivable, net (credit allowance of $ | ||||||||||||||
Reinsurance recoverable on paid and unpaid losses, net (credit allowance of $ | ||||||||||||||
Ceded unearned premiums | ||||||||||||||
Goodwill | ||||||||||||||
Deferred policy acquisition costs, net | ||||||||||||||
Intangible assets, net | ||||||||||||||
Other assets | ||||||||||||||
Assets held for disposal | ||||||||||||||
Total Assets | $ | $ | ||||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||
Liabilities: | ||||||||||||||
Unpaid losses and loss adjustment expenses | $ | $ | ||||||||||||
Unearned premiums | ||||||||||||||
Reinsurance payable on premiums | ||||||||||||||
Payments outstanding | ||||||||||||||
Accounts payable and accrued expenses | ||||||||||||||
Operating lease liability | ||||||||||||||
Other liabilities | ||||||||||||||
Notes payable, net | ||||||||||||||
Liabilities held for disposal | ||||||||||||||
Total Liabilities | $ | $ | ||||||||||||
Commitments and contingencies (Note 12) | ||||||||||||||
Stockholders' Equity: | ||||||||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding | $ | $ | ||||||||||||
Common stock, $0.0001 par value; 100,000,000 shares authorized; | ||||||||||||||
Additional paid-in capital | ||||||||||||||
Treasury shares, at cost: 212,083 shares | ( | ( | ||||||||||||
Accumulated other comprehensive loss | ( | ( | ||||||||||||
Retained earnings (deficit) | ( | ( | ||||||||||||
Total Stockholders' Equity (Deficit) | $ | $ | ( | |||||||||||
Total Liabilities and Stockholders' Equity | $ | $ |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
REVENUE: | ||||||||||||||||||||||||||
Gross premiums written | $ | $ | $ | $ | ||||||||||||||||||||||
Change in gross unearned premiums | ( | ( | ( | ( | ||||||||||||||||||||||
Gross premiums earned | ||||||||||||||||||||||||||
Ceded premiums earned | ( | ( | ( | ( | ||||||||||||||||||||||
Net premiums earned | ||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||
Net realized investment losses | ( | ( | ( | ( | ||||||||||||||||||||||
Net unrealized gains (losses) on equity securities | ( | ( | ||||||||||||||||||||||||
Other revenue | ||||||||||||||||||||||||||
Total revenue | ||||||||||||||||||||||||||
EXPENSES: | ||||||||||||||||||||||||||
Losses and loss adjustment expenses | ||||||||||||||||||||||||||
Policy acquisition costs | ||||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||||
General and administrative expenses | ||||||||||||||||||||||||||
Interest expense | ||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||
Income before other income | ||||||||||||||||||||||||||
Other income | ||||||||||||||||||||||||||
Income before income taxes | ||||||||||||||||||||||||||
Provision for income taxes | ||||||||||||||||||||||||||
Income from continuing operations, net of tax | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
Income (loss) from discontinued operations, net of tax | ( | ( | ( | |||||||||||||||||||||||
Net income (loss) | ( | $ | $ | ( | ||||||||||||||||||||||
Less: Net loss attributable to NCI | ( | ( | ||||||||||||||||||||||||
Net income (loss) attributable to ACIC | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
OTHER COMPREHENSIVE INCOME (LOSS): | ||||||||||||||||||||||||||
Change in net unrealized gains (losses) on investments | ( | ( | ( | |||||||||||||||||||||||
Reclassification adjustment for net realized investment losses | ||||||||||||||||||||||||||
Income tax benefit (expense) related to items of other comprehensive income (loss) | ( | |||||||||||||||||||||||||
Total comprehensive income (loss) | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
Less: Comprehensive income (loss) attributable to NCI | ( | |||||||||||||||||||||||||
Comprehensive income (loss) attributable to ACIC | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
Weighted average shares outstanding | ||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||
Diluted | ||||||||||||||||||||||||||
Earnings available to ACIC common stockholders per share | ||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||
Continuing operations | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
Discontinued operations | ( | ( | ( | |||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
Diluted | ||||||||||||||||||||||||||
Continuing operations | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
Discontinued operations | ( | ( | ( | |||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( |
Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Other Comprehensive Loss | Retained Earnings (Deficit) | Stockholders' Equity Attributable to ACIC | NCI | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||||||
Number of Shares | Dollars | ||||||||||||||||||||||||||||||||||||||||||||||||||||
March 31, 2022 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss), net | — | — | — | — | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Return of Capital to NCI | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Stock Compensation | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2022 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ |
Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Other Comprehensive Loss | Retained Earnings (Deficit) | Stockholders' Equity Attributable to ACIC | NCI | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||||||
Number of Shares | Dollars | ||||||||||||||||||||||||||||||||||||||||||||||||||||
March 31, 2023 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||||
Net Income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income, net | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Stock Compensation | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2023 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | — | $ |
Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Other Comprehensive Loss | Retained Earnings (Deficit) | Stockholders' Equity Attributable to ACIC | NCI | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||||||
Number of Shares | Dollars | ||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2021 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net | — | — | — | — | ( | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Return of Capital to NCI | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Stock Compensation | ( | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Cash dividends on common stock ($0.06 per common share) | — | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
June 30, 2022 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ |
Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Other Comprehensive Loss | Retained Earnings (Deficit) | Stockholders' Equity (Deficit) Attributable to ACIC | NCI | Total Stockholders’ Equity (Deficit) | ||||||||||||||||||||||||||||||||||||||||||||||
Number of Shares | Dollars | ||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2022 | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | $ | — | $ | ( | |||||||||||||||||||||||||||||||||||||||
Net Income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income, net | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Impact of Deconsolidation of Discontinued Operations | — | — | — | — | ( | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Stock Compensation | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2023 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | — | $ |
Six Months Ended June 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
OPERATING ACTIVITIES | ||||||||||||||
Net income (loss) | $ | $ | ( | |||||||||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||||||||
Depreciation and amortization | ||||||||||||||
Bond amortization and accretion | ||||||||||||||
Net realized losses on investments | ||||||||||||||
Net unrealized losses (gains) on equity securities | ( | |||||||||||||
Provision for uncollectable premiums | ||||||||||||||
Provision for uncollectable reinsurance recoverables | ||||||||||||||
Deferred income taxes, net | ||||||||||||||
Stock based compensation | ||||||||||||||
Settlement of receivable owed by HCI in connection with purchase agreement | ||||||||||||||
Gain on sale of property and equipment | ( | ( | ||||||||||||
Fixed asset disposal | ||||||||||||||
Gain on disposition of former subsidiary | ( | |||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||
Accrued investment income | ||||||||||||||
Premiums receivable | ( | |||||||||||||
Reinsurance recoverable on paid and unpaid losses | ||||||||||||||
Ceded unearned premiums | ( | ( | ||||||||||||
Deferred policy acquisition costs, net | ( | |||||||||||||
Other assets | ( | ( | ||||||||||||
Unpaid losses and loss adjustment expenses | ( | ( | ||||||||||||
Unearned premiums | ( | |||||||||||||
Reinsurance payable on premiums | ||||||||||||||
Payments outstanding | ( | ( | ||||||||||||
Accounts payable and accrued expenses | ( | |||||||||||||
Operating lease liability | ( | ( | ||||||||||||
Other liabilities | ( | |||||||||||||
Net cash provided by (used in) operating activities | $ | ( | $ | |||||||||||
INVESTING ACTIVITIES | ||||||||||||||
Proceeds from sales, maturities and repayments of: | ||||||||||||||
Fixed maturities | ||||||||||||||
Equity securities | ||||||||||||||
Other investments | ||||||||||||||
Purchases of: | ||||||||||||||
Fixed maturities | ( | ( | ||||||||||||
Equity securities | ( | |||||||||||||
Other investments | ( | ( | ||||||||||||
Proceeds from sale of property and equipment | ||||||||||||||
Cost of property, equipment and capitalized software acquired | ( | ( | ||||||||||||
Disposition of cash on divestiture of subsidiary | ( | |||||||||||||
Net cash provided by investing activities | $ | $ | ||||||||||||
FINANCING ACTIVITIES | ||||||||||||||
Repayments of borrowings | ( | |||||||||||||
Dividends | ( | |||||||||||||
Return of capital in connection with termination of noncontrolling interest | ( | |||||||||||||
Net cash used in financing activities | $ | $ | ( | |||||||||||
Increase in cash, cash equivalents and restricted cash, including cash classified as assets held for disposal | ( | |||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | ||||||||||||||
Cash, cash equivalents and restricted at end of period | $ | $ | ||||||||||||
Supplemental Cash Flows Information | ||||||||||||||
Interest paid | $ | $ | ||||||||||||
Income taxes paid | $ | $ | ||||||||||||
Results From Discontinued Operations | ||||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
REVENUE: | ||||||||||||||||||||||||||
Gross premiums written | $ | $ | $ | ( | $ | |||||||||||||||||||||
Change in gross unearned premiums | ||||||||||||||||||||||||||
Gross premiums earned | ||||||||||||||||||||||||||
Ceded premiums earned | ( | ( | ( | |||||||||||||||||||||||
Net premiums earned | ||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||
Net realized investment gains (losses) | ( | ( | ||||||||||||||||||||||||
Net unrealized gains (losses) on equity securities | ( | ( | ||||||||||||||||||||||||
Other revenue | ||||||||||||||||||||||||||
Total revenue | ||||||||||||||||||||||||||
EXPENSES: | ||||||||||||||||||||||||||
Losses and loss adjustment expenses | ||||||||||||||||||||||||||
Policy acquisition costs | ( | ( | ||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||||
General and administrative expenses | ||||||||||||||||||||||||||
Interest expense | ||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||
Loss before other income | ( | ( | ( | ( | ||||||||||||||||||||||
Other income (loss) | ||||||||||||||||||||||||||
Loss before income taxes | ( | ( | ( | ( | ||||||||||||||||||||||
Provision (benefit) for income taxes | ( | ( | ||||||||||||||||||||||||
Income (loss) from discontinued operations, net of tax | $ | ( | $ | ( | $ | ( | $ | ( |
Major Classes of Assets and Liabilities Disposed | ||||||||||||||
Closing (1) | December 31, 2022 | |||||||||||||
ASSETS | ||||||||||||||
Fixed maturities, available-for-sale | $ | $ | ||||||||||||
Equity securities | ||||||||||||||
Other investments | ||||||||||||||
Cash and cash equivalents | ||||||||||||||
Restricted cash | ||||||||||||||
Accrued investment income | ||||||||||||||
Premiums receivable, net | ||||||||||||||
Reinsurance recoverable on paid and unpaid losses, net | ||||||||||||||
Ceded unearned premiums | ||||||||||||||
Deferred policy acquisition costs, net | ( | ( | ||||||||||||
Other assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
LIABILITIES | ||||||||||||||
Unpaid losses and loss adjustment expenses | ||||||||||||||
Unearned premiums | ||||||||||||||
Reinsurance payable on premiums | ||||||||||||||
Payments outstanding | ||||||||||||||
Accounts payable and accrued expenses | ( | |||||||||||||
Other liabilities | ||||||||||||||
Notes payable, net | ||||||||||||||
Total Liabilities | $ | $ |
Major Classes of Assets and Liabilities Held for Disposal | ||||||||||||||
June 30, 2023 | December 31, 2022 | |||||||||||||
ASSETS | ||||||||||||||
Property and equipment, net | ||||||||||||||
Deferred policy acquisition costs | ||||||||||||||
Total assets | $ | $ | ||||||||||||
LIABILITIES | ||||||||||||||
Commissions Payable | ||||||||||||||
Unearned Policy Fees | ||||||||||||||
Total Liabilities | $ | $ |
Three Months Ended June 30, 2023 | ||||||||||||||||||||||||||
Commercial | Personal (1) | Adjustments | Consolidated | |||||||||||||||||||||||
REVENUE: | ||||||||||||||||||||||||||
Gross premiums written | $ | $ | $ | $ | ||||||||||||||||||||||
Change in gross unearned premiums | ( | ( | ||||||||||||||||||||||||
Gross premiums earned | ||||||||||||||||||||||||||
Ceded premiums earned | ( | ( | ( | |||||||||||||||||||||||
Net premiums earned | ||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||
Net realized gains (losses) | ( | ( | ( | |||||||||||||||||||||||
Net unrealized losses on equity securities | ||||||||||||||||||||||||||
Other revenue | ||||||||||||||||||||||||||
Total revenues | ||||||||||||||||||||||||||
EXPENSES: | ||||||||||||||||||||||||||
Losses and loss adjustment expenses | ||||||||||||||||||||||||||
Policy acquisition costs | ||||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||||
General and administrative expenses (2) | ||||||||||||||||||||||||||
Interest expense | ||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||
Income (loss) before other income | ( | ( | ||||||||||||||||||||||||
Other income (loss) | ||||||||||||||||||||||||||
Income (loss) before income taxes | $ | $ | ( | ( | ||||||||||||||||||||||
Provision for income taxes | ||||||||||||||||||||||||||
Net income (loss) | $ | ( | $ | |||||||||||||||||||||||
Less: Net loss attributable to noncontrolling interests | ||||||||||||||||||||||||||
Net income (loss) attributable to ACIC | $ | ( | $ | |||||||||||||||||||||||
Loss ratio, net (3) (4) | % | % | % | |||||||||||||||||||||||
Expense ratio (3) (5) | % | % | % | |||||||||||||||||||||||
Combined ratio (3) (6) | % | % | % | |||||||||||||||||||||||
Total segment assets | $ | $ | ( | $ | $ |
Three Months Ended June 30, 2022 | ||||||||||||||||||||||||||
Commercial | Personal (1) | Adjustments | Consolidated | |||||||||||||||||||||||
REVENUE: | ||||||||||||||||||||||||||
Gross premiums written | $ | $ | $ | $ | ||||||||||||||||||||||
Change in gross unearned premiums | ( | ( | ( | |||||||||||||||||||||||
Gross premiums earned | ||||||||||||||||||||||||||
Ceded premiums earned | ( | ( | ( | |||||||||||||||||||||||
Net premiums earned | ||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||
Net realized gains (losses) | ( | ( | ||||||||||||||||||||||||
Net unrealized losses on equity securities | ( | ( | ( | |||||||||||||||||||||||
Other revenue | ||||||||||||||||||||||||||
Total revenues | ||||||||||||||||||||||||||
EXPENSES: | ||||||||||||||||||||||||||
Losses and loss adjustment expenses | ||||||||||||||||||||||||||
Policy acquisition costs | ||||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||||
General and administrative expenses (2) | ||||||||||||||||||||||||||
Interest expense | ||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||
Income (loss) before other income | ( | ( | ||||||||||||||||||||||||
Other income (loss) | ||||||||||||||||||||||||||
Income (loss) before income taxes | $ | $ | ( | ( | ||||||||||||||||||||||
Provision for income taxes | ||||||||||||||||||||||||||
Net income (loss) | $ | ( | $ | ( | ||||||||||||||||||||||
Less: Net loss attributable to noncontrolling interests | ( | ( | ||||||||||||||||||||||||
Net income (loss) attributable to ACIC | $ | ( | $ | ( | ||||||||||||||||||||||
Loss ratio, net (3) (4) | % | % | % | |||||||||||||||||||||||
Expense ratio (3) (5) | % | % | % | |||||||||||||||||||||||
Combined ratio (3) (6) | % | % | % | |||||||||||||||||||||||
Total segment assets | $ | $ | ( | $ | $ |
Six Months Ended June 30, 2023 | ||||||||||||||||||||||||||
Commercial | Personal (1) | Adjustments | Consolidated | |||||||||||||||||||||||
REVENUE: | ||||||||||||||||||||||||||
Gross premiums written | $ | $ | $ | $ | ||||||||||||||||||||||
Change in gross unearned premiums | ( | ( | ||||||||||||||||||||||||
Gross premiums earned | ||||||||||||||||||||||||||
Ceded premiums earned | ( | ( | ( | |||||||||||||||||||||||
Net premiums earned | ||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||
Net realized gains (losses) | ( | ( | ( | |||||||||||||||||||||||
Net unrealized losses on equity securities | ||||||||||||||||||||||||||
Management fee income | — | — | ||||||||||||||||||||||||
Other revenue | ||||||||||||||||||||||||||
Total revenues | ||||||||||||||||||||||||||
EXPENSES: | ||||||||||||||||||||||||||
Losses and loss adjustment expenses | ||||||||||||||||||||||||||
Policy acquisition costs | ||||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||||
General and administrative expenses (2) | ||||||||||||||||||||||||||
Interest expense | ||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||
Income (loss) before other income | ( | ( | ||||||||||||||||||||||||
Other income (loss) | ( | |||||||||||||||||||||||||
Income (loss) before income taxes | $ | $ | ( | ( | ||||||||||||||||||||||
Provision for income taxes | ||||||||||||||||||||||||||
Net income (loss) | $ | ( | $ | |||||||||||||||||||||||
Less: Net loss attributable to noncontrolling interests | ||||||||||||||||||||||||||
Net income (loss) attributable to ACIC | $ | ( | $ | |||||||||||||||||||||||
Loss ratio, net (3) (4) | % | % | % | |||||||||||||||||||||||
Expense ratio (3) (5) | % | % | % | |||||||||||||||||||||||
Combined ratio (3) (6) | % | % | % | |||||||||||||||||||||||
Total segment assets | $ | $ | ( | $ | $ |
Six Months Ended June 30, 2022 | ||||||||||||||||||||||||||
Commercial | Personal (1) | Adjustments | Consolidated | |||||||||||||||||||||||
REVENUE: | ||||||||||||||||||||||||||
Gross premiums written | $ | $ | $ | $ | ||||||||||||||||||||||
Change in gross unearned premiums | ( | ( | ( | |||||||||||||||||||||||
Gross premiums earned | ||||||||||||||||||||||||||
Ceded premiums earned | ( | ( | ( | |||||||||||||||||||||||
Net premiums earned | ||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||
Net realized gains | ( | ( | ||||||||||||||||||||||||
Net unrealized losses on equity securities | ( | ( | ( | |||||||||||||||||||||||
Management fee income | ||||||||||||||||||||||||||
Other revenue | ||||||||||||||||||||||||||
Total revenues | ||||||||||||||||||||||||||
EXPENSES: | ||||||||||||||||||||||||||
Losses and loss adjustment expenses | ||||||||||||||||||||||||||
Policy acquisition costs | ||||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||||
General and administrative expenses (2) | ||||||||||||||||||||||||||
Interest expense | ||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||
Income (loss) before other income | ( | ( | ||||||||||||||||||||||||
Other income | ( | |||||||||||||||||||||||||
Income (loss) before income taxes | $ | $ | ( | ( | ||||||||||||||||||||||
Provision for income taxes | ||||||||||||||||||||||||||
Net income (loss) | $ | ( | $ | ( | ||||||||||||||||||||||
Less: Net income attributable to noncontrolling interests | ( | ( | ||||||||||||||||||||||||
Net income (loss) attributable to ACIC | $ | ( | $ | ( | ||||||||||||||||||||||
Loss ratio, net (3) (4) (7) | % | % | % | |||||||||||||||||||||||
Expense ratio (3) (5) (7) | % | % | % | |||||||||||||||||||||||
Combined ratio (3) (6) (7) | % | 161.8 | % | % | ||||||||||||||||||||||
Total segment assets | $ | $ | ( | $ | $ |
Cost or Adjusted/Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||
June 30, 2023 | |||||||||||||||||||||||
U.S. government and agency securities | $ | $ | $ | $ | |||||||||||||||||||
Foreign government | |||||||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||
Public utilities | |||||||||||||||||||||||
Corporate securities | |||||||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||
Total fixed maturities | $ | $ | $ | $ | |||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
U.S. government and agency securities | $ | $ | $ | $ | |||||||||||||||||||
Foreign government | |||||||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||
Public utilities | |||||||||||||||||||||||
Corporate securities | |||||||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||
Total fixed maturities | $ | $ | $ | $ |
June 30, 2023 | December 31, 2022 | |||||||||||||||||||||||||
Estimated Fair Value | Percent of Total | Estimated Fair Value | Percent of Total | |||||||||||||||||||||||
Mutual funds | $ | % | $ | % | ||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
Gains (Losses) | Fair Value at Sale | Gains (Losses) | Fair Value at Sale | ||||||||||||||||||||
Three Months Ended June 30, | |||||||||||||||||||||||
Fixed maturities | $ | $ | $ | $ | |||||||||||||||||||
Equity securities | |||||||||||||||||||||||
Short-term investments | |||||||||||||||||||||||
Total realized gains | |||||||||||||||||||||||
Fixed maturities | ( | ( | |||||||||||||||||||||
Equity securities | ( | ||||||||||||||||||||||
Short-term investments | |||||||||||||||||||||||
Total realized losses | ( | ( | |||||||||||||||||||||
Net realized investment gains (losses) | $ | ( | $ | $ | ( | $ | |||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||||
Fixed maturities | $ | $ | $ | $ | |||||||||||||||||||
Equity securities | |||||||||||||||||||||||
Short-term investments | |||||||||||||||||||||||
Total realized gains | |||||||||||||||||||||||
Fixed maturities | ( | ( | |||||||||||||||||||||
Equity securities | ( | ||||||||||||||||||||||
Short-term investments | |||||||||||||||||||||||
Total realized losses | ( | ( | |||||||||||||||||||||
Net realized investment gains (losses) | $ | ( | $ | $ | ( | $ |
June 30, 2023 | |||||||||||||||||||||||
Cost or Amortized Cost | Percent of Total | Fair Value | Percent of Total | ||||||||||||||||||||
Due in one year or less | $ | % | $ | % | |||||||||||||||||||
Due after one year through five years | |||||||||||||||||||||||
Due after five years through ten years | |||||||||||||||||||||||
Due after ten years | |||||||||||||||||||||||
Asset and mortgage-backed securities | |||||||||||||||||||||||
Total | $ | % | $ | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Fixed maturities | $ | $ | $ | $ | |||||||||||||||||||
Equity securities | |||||||||||||||||||||||
Cash and cash equivalents | |||||||||||||||||||||||
Other investments | ( | ( | |||||||||||||||||||||
Investment income | |||||||||||||||||||||||
Investment expenses | ( | ( | ( | ( | |||||||||||||||||||
Net investment income | $ | $ | $ | $ |
Less Than Twelve Months | Twelve Months or More | ||||||||||||||||||||||||||||||||||
Number of Securities(1) | Gross Unrealized Losses | Fair Value | Number of Securities(1) | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||||||||||||
June 30, 2023 | |||||||||||||||||||||||||||||||||||
U.S. government and agency securities | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Foreign governments | |||||||||||||||||||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||||||||||||||
Public utilities | |||||||||||||||||||||||||||||||||||
Corporate securities | |||||||||||||||||||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||||||||||||||
Total fixed maturities | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||||||||
U.S. government and agency securities | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Foreign governments | |||||||||||||||||||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||||||||||||||
Public utilities | |||||||||||||||||||||||||||||||||||
Corporate securities | |||||||||||||||||||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||||||||||||||
Total fixed maturities | $ | $ | $ | $ |
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
June 30, 2023 | |||||||||||||||||||||||
U.S. government and agency securities | $ | $ | $ | $ | |||||||||||||||||||
Foreign government | |||||||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||
Public utilities | |||||||||||||||||||||||
Corporate securities | |||||||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||
Total fixed maturities | |||||||||||||||||||||||
Mutual funds | |||||||||||||||||||||||
Total equity securities | |||||||||||||||||||||||
Other investments (1) | |||||||||||||||||||||||
Total investments | $ | $ | $ | $ | |||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
U.S. government and agency securities | $ | $ | $ | $ | |||||||||||||||||||
Foreign government | |||||||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||
Public utilities | |||||||||||||||||||||||
Corporate securities | |||||||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||
Total fixed maturities | |||||||||||||||||||||||
Mutual Funds | |||||||||||||||||||||||
Total equity securities | |||||||||||||||||||||||
Other investments (1) | |||||||||||||||||||||||
Total investments | $ | $ | $ | $ |
Book Value | Unrealized Gain | Unrealized Loss | Fair Value | |||||||||||||||||||||||
June 30, 2023 | ||||||||||||||||||||||||||
Limited partnership investments (1) | $ | $ | $ | $ | ||||||||||||||||||||||
Certificates of deposit | ||||||||||||||||||||||||||
Short-term investments | ||||||||||||||||||||||||||
Total other investments | $ | $ | $ | $ |
June 30, 2023 | December 31, 2022 | ||||||||||
Trust funds | $ | $ | |||||||||
Cash on deposit (regulatory deposits) | |||||||||||
Total restricted cash | $ | $ |
June 30, 2023 | December 31, 2022 | ||||||||||
Invested assets on deposit (regulatory deposits) | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||||
Net income (loss) attributable to ACIC common stockholders | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
Denominator: | ||||||||||||||||||||||||||
Weighted-average shares outstanding | ||||||||||||||||||||||||||
Effect of dilutive securities | ||||||||||||||||||||||||||
Weighted-average diluted shares | ||||||||||||||||||||||||||
Earnings available to ACIC common stockholders per share | ||||||||||||||||||||||||||
Basic | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
Diluted | $ | $ | ( | $ | $ | ( |
June 30, 2023 | December 31, 2022 | |||||||||||||
Computer hardware and software (software in progress of $76 and $82, respectively) | $ | $ | ||||||||||||
Office furniture and equipment | ||||||||||||||
Leasehold improvements | ||||||||||||||
Leased vehicles(1) | ||||||||||||||
Total, at cost | ||||||||||||||
Less: accumulated depreciation and amortization | ( | ( | ||||||||||||
Property and equipment, net | $ | $ |
June 30, 2023 | December 31, 2022 | |||||||||||||
Intangible assets subject to amortization | $ | $ | ||||||||||||
Indefinite-lived intangible assets(1) | ||||||||||||||
Total | $ | $ |
Weighted-average remaining amortization period (in years) | Gross carrying amount | Accumulated amortization | Net carrying amount | |||||||||||||||||||||||
June 30, 2023 | ||||||||||||||||||||||||||
Value of business acquired | — | $ | $ | ( | $ | |||||||||||||||||||||
Agency agreements acquired | 3.8 | ( | ||||||||||||||||||||||||
Trade names acquired | 0.8 | ( | ||||||||||||||||||||||||
Total | $ | $ | ( | $ | ||||||||||||||||||||||
December 31, 2022 | ||||||||||||||||||||||||||
Value of business acquired | — | $ | $ | ( | $ | |||||||||||||||||||||
Agency agreements acquired | 4.3 | ( | ||||||||||||||||||||||||
Trade names acquired | 1.3 | ( | ||||||||||||||||||||||||
Total | $ | $ | ( | $ |
Year ending December 31, | Estimated Amortization Expense | |||||||
Remaining in 2023 | $ | |||||||
2024 | ||||||||
2025 | ||||||||
2026 | ||||||||
2027 | ||||||||
2028 |
Reinsurer | Companies in Scope (1) | Effective Dates | Cession Rate | States in Scope | ||||||||||
External third-party | AmCoastal | 06/01/2023 - 06/01/2024 | 40% (2) | Florida | ||||||||||
External third-party | UPC, FSIC & AmCoastal | 06/01/2022 - 06/01/2023 | 10% (2) | Florida, Louisiana, Texas | ||||||||||
TypTap | UPC | 06/01/2022 - 06/01/2023 | 100% (3) | Georgia, North Carolina, South Carolina | ||||||||||
External third-party | UPC, FSIC & AmCoastal | 12/31/2021 - 12/31/2022 | 8% (2) | Florida, Louisiana, Texas | ||||||||||
HCPCI | UPC | 12/31/2021 - 06/01/2022 | 85% | Georgia, North Carolina, South Carolina | ||||||||||
External third-party | UPC & FSIC | 12/31/2021 - 12/31/2022 | 25% (4) | Florida, Louisiana, Texas | ||||||||||
HCPCI / TypTap (5) | UPC | 06/01/2021 - 06/01/2022 | 100% (3) | Connecticut, New Jersey, Massachusetts, Rhode Island | ||||||||||
External third-party | UPC, FSIC & AmCoastal (6) | 06/01/2021 - 06/01/2022 | 15% (2) | Florida, Georgia, Louisiana, North Carolina, South Carolina, Texas | ||||||||||
IIC | UPC | 12/31/2020 - 12/31/2022 | 100% | New York |
June 30, | December 31, | ||||||||||
2023 | 2022 | ||||||||||
Reinsurance recoverable on unpaid losses and loss adjustment expenses | $ | $ | |||||||||
Reinsurance recoverable on paid losses and loss adjustment expenses | |||||||||||
Reinsurance recoverable (1) | $ | $ |
June 30, | |||||||||||
2023 | 2022 | ||||||||||
Balance at January 1 | $ | $ | |||||||||
Less: reinsurance recoverable on unpaid losses | |||||||||||
Net balance at January 1 | $ | $ | |||||||||
Incurred related to: | |||||||||||
Current year | |||||||||||
Prior years | ( | ( | |||||||||
Total incurred | $ | $ | |||||||||
Paid related to: | |||||||||||
Current year | |||||||||||
Prior years | |||||||||||
Total paid | $ | $ | |||||||||
Net balance at June 30 | $ | $ | |||||||||
Plus: reinsurance recoverable on unpaid losses | |||||||||||
Balance at June 30 | $ | $ | |||||||||
Composition of reserve for unpaid losses and LAE: | |||||||||||
Case reserves | $ | $ | |||||||||
IBNR reserves | |||||||||||
Balance at June 30 | $ | $ |
Effective Interest Rate | Carrying Value at | ||||||||||||||||||||||
Maturity | June 30, 2023 | December 31, 2022 | |||||||||||||||||||||
Senior Notes | $ | $ | |||||||||||||||||||||
Florida State Board of Administration Note (1) | N/A | ||||||||||||||||||||||
Truist Term Note Payable (2) | N/A | ||||||||||||||||||||||
Total long-term debt | $ | $ |
2023 | 2022 | ||||||||||
Balance at January 1, | $ | $ | |||||||||
Additions | |||||||||||
Amortization | ( | ( | |||||||||
Balance at June 30, | $ | $ |
Financial Statement Line | June 30, 2023 | December 31, 2022 | ||||||||||||||||||
Assets | ||||||||||||||||||||
Operating lease assets | Other assets | $ | $ | |||||||||||||||||
Financing lease assets | Property and equipment, net | |||||||||||||||||||
Total lease assets | $ | $ | ||||||||||||||||||
Liabilities | ||||||||||||||||||||
Operating lease liabilities | Operating lease liability | $ | $ | |||||||||||||||||
Financing lease liabilities | Other liabilities | |||||||||||||||||||
Total lease liabilities | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Operating lease expense | $ | $ | $ | $ | ||||||||||||||||||||||
Financing lease expense: | ||||||||||||||||||||||||||
Amortization of leased assets | ||||||||||||||||||||||||||
Interest on lease liabilities | ||||||||||||||||||||||||||
Net lease expense | $ | $ | $ | $ |
Total | ||||||||
Remaining in 2023 | $ | |||||||
2024 | ||||||||
2025 | ||||||||
2026 | ||||||||
Total undiscounted future minimum lease payments | ||||||||
Less: Imputed interest | ( | |||||||
Present value of lease liabilities | $ |
June 30, 2023 | December 31, 2022 | |||||||||||||
Weighted average remaining lease term (months) | ||||||||||||||
Operating leases | 21 | 25 | ||||||||||||
Financing leases | — | 9 | ||||||||||||
Weighted average discount rate | ||||||||||||||
Operating leases | % | % | ||||||||||||
Financing leases | % | % |
June 30, 2023 | December 31, 2022 | Provision for expected credit losses | Write-offs | June 30, 2023 | ||||||||||||||||||||||
Premiums Receivable | $ | $ | ( | $ | $ | |||||||||||||||||||||
Reinsurance Recoverables | ( | |||||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | |||||||||||||||||||||
June 30, 2022 | December 31, 2021 | Provision for expected credit losses | Write-offs | June 30, 2022 | ||||||||||||||||||||||
Premiums Receivable | $ | $ | ( | $ | $ | |||||||||||||||||||||
Reinsurance Recoverables | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
AmCoastal(1) | ||||||||||||||||||||||||||
IIC | ( | ( | ( | |||||||||||||||||||||||
Total | $ | $ | $ | $ |
June 30, 2023 | December 31, 2022 | |||||||||||||
AmCoastal(1) | ||||||||||||||
IIC | ||||||||||||||
Total | $ | $ |
Pre-Tax Amount | Tax (Expense) Benefit | Net-of-Tax Amount | |||||||||||||||
December 31, 2022 | $ | ( | $ | $ | ( | ||||||||||||
Changes in net unrealized losses on investments | |||||||||||||||||
Reclassification adjustment for realized losses | ( | ||||||||||||||||
Impact of deconsolidation of discontinued operations | $ | ( | $ | $ | |||||||||||||
June 30, 2023 | $ | ( | $ | $ | ( |
Six Months Ended June 30, | ||||||||||||||||||||||||||
2023 | 2022 | |||||||||||||||||||||||||
Per Share Amount | Aggregate Amount | Per Share Amount | Aggregate Amount | |||||||||||||||||||||||
First Quarter | $ | — | $ | — | $ | 0.06 | $ | 2,589 | ||||||||||||||||||
Second Quarter | — | — | ||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Employee stock-based compensation expense | ||||||||||||||||||||||||||
Pre-tax | $ | $ | $ | $ | ||||||||||||||||||||||
Post-tax (1) | ||||||||||||||||||||||||||
Director stock-based compensation expense | ||||||||||||||||||||||||||
Pre-tax | ||||||||||||||||||||||||||
Post-tax (1) |
Number of Restricted Shares | Weighted Average Grant Date Fair Value | ||||||||||
Outstanding as of December 31, 2022 | $ | ||||||||||
Granted (1) | |||||||||||
Less: Forfeited | |||||||||||
Less: Vested | |||||||||||
Outstanding as of June 30, 2023 | $ |
2023 | 2022 | ||||||||||
Expected annual dividend yield | — | % | — | % | |||||||
Expected volatility | % | % | |||||||||
Risk-free interest rate | % | % | |||||||||
Expected term | 6 years | 6 years |
Number of Stock Options | Weighted Average Exercise Prices | Weighted Average Remaining Contractual Term (years) | Aggregate Intrinsic Value | ||||||||||||||||||||
Outstanding as of December 31, 2022 | $ | 7.66 | $ | ||||||||||||||||||||
Granted(1) | — | ||||||||||||||||||||||
Less: Forfeited | — | ||||||||||||||||||||||
Less: Expired | — | — | |||||||||||||||||||||
Less: Exercised | — | ||||||||||||||||||||||
Outstanding as of June 30, 2023 | $ | 8.30 | $ | ||||||||||||||||||||
Vested as of June 30, 2023(2) | $ | 7.99 | $ | ||||||||||||||||||||
Exercisable as of June 30, 2023 | $ | 7.99 | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Gross premiums written | $ | 243,885 | $ | 207,632 | $ | 431,008 | $ | 350,046 | |||||||||||||||
Gross premiums earned | 158,199 | 129,483 | 302,675 | 252,216 | |||||||||||||||||||
Net premiums earned | 83,169 | 64,532 | 170,493 | 122,278 | |||||||||||||||||||
Total revenues | 79,295 | 63,910 | 169,615 | 122,342 | |||||||||||||||||||
Earnings from continuing operations, net of tax | 20,352 | (13,311) | 50,719 | (13,584) | |||||||||||||||||||
Income (loss) from discontinued operations, net of tax | (2,573) | (55,744) | 234,340 | (88,728) | |||||||||||||||||||
Consolidated net income (loss) attributable to ACIC | 17,779 | (69,029) | 285,059 | (102,201) | |||||||||||||||||||
Net income (loss) available to ACIC stockholders per diluted share | |||||||||||||||||||||||
Continuing Operations | $ | 0.47 | $ | (0.31) | $ | 1.16 | $ | (0.31) | |||||||||||||||
Discontinued Operations | (0.06) | (1.29) | 5.36 | (2.06) | |||||||||||||||||||
Total | $ | 0.41 | $ | (1.60) | $ | 6.52 | $ | (2.37) | |||||||||||||||
Reconciliation of net income (loss) to core income (loss): | |||||||||||||||||||||||
Plus: Non-cash amortization of intangible assets | $ | 811 | $ | 812 | $ | 1,623 | $ | 1,624 | |||||||||||||||
Less: Income (loss) from discontinued operations, net of tax | (2,573) | (55,744) | 234,340 | (88,728) | |||||||||||||||||||
Less: Realized losses on investment portfolio | (6,725) | (77) | (6,808) | (40) | |||||||||||||||||||
Less: Unrealized gains (losses) on equity securities | 141 | (2,391) | 615 | (3,161) | |||||||||||||||||||
Less: Net tax impact (1) | 1,553 | 689 | 1,641 | 1,013 | |||||||||||||||||||
Core income (2) | 26,192 | (10,693) | 56,894 | (9,660) | |||||||||||||||||||
Core income per diluted share(2) | $ | 0.60 | $ | (0.25) | $ | 1.30 | $ | (0.22) | |||||||||||||||
Book value per share | $ | 2.59 | $ | 3.85 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
REVENUE: | ||||||||||||||||||||||||||
Gross premiums written | $ | 243,885 | $ | 207,632 | $ | 431,008 | $ | 350,046 | ||||||||||||||||||
Change in gross unearned premiums | (85,686) | (78,149) | (128,333) | (97,830) | ||||||||||||||||||||||
Gross premiums earned | 158,199 | 129,483 | 302,675 | 252,216 | ||||||||||||||||||||||
Ceded premiums earned | (75,030) | (64,951) | (132,182) | (129,938) | ||||||||||||||||||||||
Net premiums earned | 83,169 | 64,532 | 170,493 | 122,278 | ||||||||||||||||||||||
Net investment income | 2,692 | 1,839 | 5,281 | 3,243 | ||||||||||||||||||||||
Net realized investment losses | (6,725) | (77) | (6,808) | (40) | ||||||||||||||||||||||
Net unrealized gains (losses) on equity securities | 141 | (2,391) | 615 | (3,161) | ||||||||||||||||||||||
Other revenue | 18 | 7 | 34 | 22 | ||||||||||||||||||||||
Total revenue | 79,295 | 63,910 | 169,615 | 122,342 | ||||||||||||||||||||||
EXPENSES: | ||||||||||||||||||||||||||
Losses and loss adjustment expenses | 20,915 | 14,032 | 37,327 | 40,347 | ||||||||||||||||||||||
Policy acquisition costs | 25,545 | 23,570 | 52,517 | 43,878 | ||||||||||||||||||||||
Operating expenses | 3,274 | 3,820 | 5,442 | 7,527 | ||||||||||||||||||||||
General and administrative expenses | 6,583 | 8,208 | 15,376 | 16,272 | ||||||||||||||||||||||
Interest expense | 2,719 | 2,363 | 5,438 | 4,722 | ||||||||||||||||||||||
Total expenses | 59,036 | 51,993 | 116,100 | 112,746 | ||||||||||||||||||||||
Income before other income | 20,259 | 11,917 | 53,515 | 9,596 | ||||||||||||||||||||||
Other income | 806 | 258 | 1,394 | 1,591 | ||||||||||||||||||||||
Income before income taxes | 21,065 | 12,175 | 54,909 | 11,187 | ||||||||||||||||||||||
Provision for income taxes | 713 | 25,486 | 4,190 | 24,771 | ||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 20,352 | $ | (13,311) | $ | 50,719 | $ | (13,584) | ||||||||||||||||||
Income (loss) from discontinued operations, net of tax | (2,573) | (55,744) | 234,340 | (88,728) | ||||||||||||||||||||||
Net income (loss) | $ | 17,779 | $ | (69,055) | $ | 285,059 | $ | (102,312) | ||||||||||||||||||
Less: Net loss attributable to noncontrolling interests | — | (26) | — | (111) | ||||||||||||||||||||||
Net income (loss) attributable to ACIC | $ | 17,779 | $ | (69,029) | $ | 285,059 | $ | (102,201) | ||||||||||||||||||
Earnings available to ACIC common stockholders per diluted share | $ | 0.41 | $ | (1.60) | $ | 6.52 | $ | (2.37) | ||||||||||||||||||
Book value per share | $ | 2.59 | $ | 3.85 | ||||||||||||||||||||||
Return on equity based on GAAP net income (loss) | NM | (72.2) | % | |||||||||||||||||||||||
Loss ratio, net (1) | 25.1 | % | 21.7 | % | 21.9 | % | 33.0 | % | ||||||||||||||||||
Expense ratio (2) | 42.6 | % | 55.2 | % | 43.0 | % | 55.3 | % | ||||||||||||||||||
Combined ratio (3) | 67.7 | % | 76.9 | % | 64.9 | % | 88.3 | % | ||||||||||||||||||
Effect of current year catastrophe losses on combined ratio | 7.9 | % | (3.3) | % | 5.4 | % | 2.8 | % | ||||||||||||||||||
Effect of prior year development on combined ratio | (6.2) | % | (6.0) | % | (4.9) | % | (5.7) | % | ||||||||||||||||||
Underlying combined ratio (4) | 66.0 | % | 86.2 | % | 64.4 | % | 91.2 | % |
June 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Estimated Fair Value | Percent of Total | Estimated Fair Value | Percent of Total | ||||||||||||||||||||
U.S. government and agency securities | $ | 2,393 | 1.0% | $ | 2,385 | 0.7% | |||||||||||||||||
Foreign government | 995 | 0.4% | 991 | 0.3% | |||||||||||||||||||
States, municipalities and political subdivisions | 23,479 | 9.7% | 26,895 | 7.9% | |||||||||||||||||||
Public utilities | 5,009 | 2.1% | 7,694 | 2.3% | |||||||||||||||||||
Corporate securities | 61,770 | 25.5% | 83,343 | 24.3% | |||||||||||||||||||
Mortgage-backed securities | 49,464 | 20.5% | 56,115 | 16.5% | |||||||||||||||||||
Asset-backed securities | 17,753 | 7.3% | 27,259 | 8.0% | |||||||||||||||||||
Total fixed maturities | 160,863 | 66.5 | % | 204,682 | 60.0 | % | |||||||||||||||||
Mutual funds | — | —% | 15,657 | 4.6% | |||||||||||||||||||
Total equity securities | — | — | % | 15,657 | 4.6 | % | |||||||||||||||||
Other investments | 3,582 | 1.5 | % | 3,675 | 1.1 | % | |||||||||||||||||
Total investments | 164,446 | 68.0% | 224,014 | 65.7% | |||||||||||||||||||
Cash and cash equivalents | 27,767 | 11.5 | % | 70,903 | 20.8 | % | |||||||||||||||||
Restricted cash | 49,501 | 20.5% | 45,988 | 13.5% | |||||||||||||||||||
Total cash, cash equivalents, restricted cash and investments | $ | 241,714 | 100.0 | % | $ | 340,905 | 100.0 | % |
Reinsurer | Companies in Scope (1) | Effective Dates | Cession Rate | States in Scope | ||||||||||
External third-party | AmCoastal | 06/01/2023 - 06/01/2024 | 40% (2) | Florida | ||||||||||
External third-party | UPC, FSIC & AmCoastal | 06/01/2022 - 06/01/2023 | 10% (2) | Florida, Louisiana, Texas | ||||||||||
TypTap | UPC | 06/01/2022 - 06/01/2023 | 100% (3) | Georgia, North Carolina, South Carolina | ||||||||||
External third-party | UPC, FSIC & AmCoastal | 12/31/2021 - 12/31/2022 | 8% (2) | Florida, Louisiana, Texas | ||||||||||
HCPCI | UPC | 12/31/2021 - 06/01/2022 | 85% | Georgia, North Carolina, South Carolina | ||||||||||
External third-party | UPC & FSIC | 12/31/2021 - 12/31/2022 | 25% (4) | Florida, Louisiana, Texas | ||||||||||
HCPCI / TypTap (5) | UPC | 06/01/2021 - 06/01/2022 | 100% (3) | Connecticut, New Jersey, Massachusetts, Rhode Island | ||||||||||
External third-party | UPC, FSIC & AmCoastal (6) | 06/01/2021 - 06/01/2022 | 15% (2) | Florida, Georgia, Louisiana, North Carolina, South Carolina, Texas | ||||||||||
IIC | UPC | 12/31/2020 - 12/31/2022 | 100% | New York |
2023 | 2022 | |||||||||||||
Three Months Ended June 30, | ||||||||||||||
Non-at-Risk | (0.5) | % | (0.6) | % | ||||||||||
Quota Share | (14.4) | % | (14.2) | % | ||||||||||
All Other | (32.5) | % | (35.4) | % | ||||||||||
Total Ceding Ratio | (47.4) | % | (50.2) | % | ||||||||||
Six Months Ended June 30, | ||||||||||||||
Non-at-Risk | (0.5) | % | (0.6) | % | ||||||||||
Quota Share | (10.5) | % | (14.9) | % | ||||||||||
All Other | (32.8) | % | (36.0) | % | ||||||||||
Total Ceding Ratio | (43.8) | % | (51.5) | % |
Personal | Commercial | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||||||||
Non-at-Risk | (2) | % | (1.1) | % | (0.4) | % | (0.5) | % | ||||||||||||||||||
Quota Share | — | % | — | % | (15.6) | % | (16.3) | % | ||||||||||||||||||
All Other | (23.9) | % | (18.5) | % | (33.2) | % | (37.8) | % | ||||||||||||||||||
Total Ceding Ratio | (25.9) | % | (19.6) | % | (49.2) | % | (54.6) | % | ||||||||||||||||||
Six Months Ended June 30, | ||||||||||||||||||||||||||
Non-at-Risk | (1.8) | % | (1.2) | % | (0.4) | % | (0.5) | % | ||||||||||||||||||
Quota Share | — | % | — | % | (11.4) | % | (17.0) | % | ||||||||||||||||||
All Other | (26.4) | % | (18.3) | % | (33.3) | % | (38.6) | % | ||||||||||||||||||
Total Ceding Ratio | (28.2) | % | (19.5) | % | (45.1) | % | (56.1) | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Quota Share | $ | (118,956) | $ | (17,944) | $ | (131,199) | $ | (41,072) | |||||||||||||||
Excess-of-loss | (219,201) | (172,733) | (238,496) | (178,240) | |||||||||||||||||||
Equipment, identity theft, and cyber security | (847) | (1,035) | (1,667) | (1,781) | |||||||||||||||||||
Ceded premiums written | $ | (339,004) | $ | (191,712) | $ | (371,362) | $ | (221,093) | |||||||||||||||
Change in ceded unearned premiums | 263,974 | 126,761 | 239,180 | 91,155 | |||||||||||||||||||
Ceded premiums earned | $ | (75,030) | $ | (64,951) | $ | (132,182) | $ | (129,938) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Quota Share | $ | (118,956) | $ | (17,944) | $ | (131,199) | $ | (41,072) | |||||||||||||||
Excess-of-loss | (211,599) | (158,335) | (229,899) | (164,189) | |||||||||||||||||||
Equipment, identity theft, and cyber security | (643) | (858) | (1,173) | (1,436) | |||||||||||||||||||
Ceded premiums written | $ | (331,198) | $ | (177,137) | $ | (362,271) | $ | (206,697) | |||||||||||||||
Change in ceded unearned premiums | 259,373 | 115,366 | 237,072 | 82,904 | |||||||||||||||||||
Ceded premiums earned | $ | (71,825) | $ | (61,771) | $ | (125,199) | $ | (123,793) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Excess-of-loss | (7,602) | (14,404) | (8,597) | (14,051) | |||||||||||||||||||
Equipment, identity theft, and cyber security | (204) | (177) | (494) | (345) | |||||||||||||||||||
Ceded premiums written | $ | (7,806) | $ | (14,581) | $ | (9,091) | $ | (14,396) | |||||||||||||||
Change in ceded unearned premiums | 4,601 | 11,401 | 2,108 | 8,251 | |||||||||||||||||||
Ceded premiums earned | $ | (3,205) | $ | (3,180) | $ | (6,983) | $ | (6,145) |
2023 | 2022 | |||||||||||||||||||||||||||||||||||||
Number of Events | Incurred Loss and LAE (1) | Combined Ratio Impact | Number of Events | Incurred Loss and LAE (1) | Combined Ratio Impact | |||||||||||||||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||
Current period catastrophe losses incurred | ||||||||||||||||||||||||||||||||||||||
Named and numbered storms | — | $ | — | — | % | — | $ | — | — | % | ||||||||||||||||||||||||||||
All other catastrophe loss events | 5 | 6,540 | 7.9 | % | 7 | (2,113) | (3.3) | % | ||||||||||||||||||||||||||||||
Total | 5 | $ | 6,540 | 7.9 | % | 7 | $ | (2,113) | (3.3) | % | ||||||||||||||||||||||||||||
Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||
Current period catastrophe losses incurred | ||||||||||||||||||||||||||||||||||||||
Named and numbered storms | — | $ | — | — | % | — | $ | — | — | % | ||||||||||||||||||||||||||||
All other catastrophe loss events | 8 | 9,155 | 5.4 | % | 10 | 3,416 | 2.8 | % | ||||||||||||||||||||||||||||||
Total | 8 | $ | 9,155 | 5.4 | % | 10 | $ | 3,416 | 2.8 | % |
2023 | 2022 | |||||||||||||||||||||||||||||||||||||
Number of Events | Incurred Loss and LAE (1) | Combined Ratio Impact | Number of Events | Incurred Loss and LAE (1) | Combined Ratio Impact | |||||||||||||||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||
Current period catastrophe losses incurred | ||||||||||||||||||||||||||||||||||||||
Named and numbered storms | — | $ | — | — | % | — | $ | — | — | % | ||||||||||||||||||||||||||||
All other catastrophe loss events | 5 | 6,201 | 8.4 | % | 3 | (2,587) | (5.0) | % | ||||||||||||||||||||||||||||||
Total | 5 | $ | 6,201 | 8.4 | % | 3 | $ | (2,587) | (5.0) | % | ||||||||||||||||||||||||||||
Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||
Current period catastrophe losses incurred | ||||||||||||||||||||||||||||||||||||||
Named and numbered storms | — | $ | — | — | % | — | $ | — | — | % | ||||||||||||||||||||||||||||
All other catastrophe loss events | 6 | 8,298 | 5.4 | % | 6 | 518 | 0.5 | % | ||||||||||||||||||||||||||||||
Total | 6 | $ | 8,298 | 5.4 | % | 6 | $ | 518 | 0.5 | % |
2023 | 2022 | |||||||||||||||||||||||||||||||||||||
Number of Events | Incurred Loss and LAE (1) | Combined Ratio Impact | Number of Events | Incurred Loss and LAE (1) | Combined Ratio Impact | |||||||||||||||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||
Current period catastrophe losses incurred | ||||||||||||||||||||||||||||||||||||||
Named and numbered storms | — | $ | — | — | % | — | $ | — | — | % | ||||||||||||||||||||||||||||
All other catastrophe loss events | — | 340 | 3.7 | % | 3 | 474 | 3.6 | % | ||||||||||||||||||||||||||||||
Total | — | $ | 340 | 3.7 | % | 3 | $ | 474 | 3.6 | % | ||||||||||||||||||||||||||||
Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||
Current period catastrophe losses incurred | ||||||||||||||||||||||||||||||||||||||
Named and numbered storms | — | $ | — | — | % | — | $ | — | — | % | ||||||||||||||||||||||||||||
All other catastrophe loss events | 3 | 858 | 4.8 | % | 6 | 2,898 | 11.4 | % | ||||||||||||||||||||||||||||||
Total | 3 | $ | 858 | 4.8 | % | 6 | $ | 2,898 | 11.4 | % |
($ in thousands) | Three Months Ended June 30, | |||||||||||||||||||
2023 | 2022 | Change | ||||||||||||||||||
Direct Written and Assumed Premium by State (1) | ||||||||||||||||||||
Florida | $ | 236,766 | $ | 179,188 | $ | 57,578 | ||||||||||||||
New York | 7,063 | 4,984 | 2,079 | |||||||||||||||||
Texas | — | 1,803 | (1,803) | |||||||||||||||||
South Carolina | — | (78) | 78 | |||||||||||||||||
Total direct written premium by state | 243,829 | 185,897 | 57,932 | |||||||||||||||||
Assumed premium (2) | 56 | 21,735 | (21,679) | |||||||||||||||||
Total gross written premium by state | $ | 243,885 | $ | 207,632 | $ | 36,253 | ||||||||||||||
Gross Written Premium by Line of Business | ||||||||||||||||||||
Commercial property | 236,822 | 181,067 | 55,755 | |||||||||||||||||
Personal property | $ | 7,063 | $ | 26,565 | $ | (19,502) | ||||||||||||||
Total gross written premium by line of business | $ | 243,885 | $ | 207,632 | $ | 36,253 |
Three Months Ended June 30, | |||||||||||||||||
New and Renewal Policies(1) by State (2) | 2023 | 2022 | Change | ||||||||||||||
Florida | 1,457 | 1,956 | (499) | ||||||||||||||
New York | 4,563 | 10,991 | (6,428) | ||||||||||||||
Texas | — | 14 | (14) | ||||||||||||||
South Carolina | — | 1 | (1) | ||||||||||||||
Total | 6,020 | 12,962 | (6,942) |
Three Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Net loss and LAE | $ | 20,915 | $ | 14,032 | $ | 6,883 | |||||||||||
% of Gross earned premiums | 13.2 | % | 10.8 | % | 2.4 pts | ||||||||||||
% of Net earned premiums | 25.1 | % | 21.7 | % | 3.4 pts | ||||||||||||
Less: | |||||||||||||||||
Current year catastrophe losses | $ | 6,540 | $ | (2,112) | $ | 8,652 | |||||||||||
Prior year reserve unfavorable development | (5,151) | (3,877) | (1,274) | ||||||||||||||
Underlying loss and LAE (1) | $ | 19,526 | $ | 20,021 | $ | (495) | |||||||||||
% of Gross earned premiums | 12.3 | % | 15.5 | % | (3.2) pts | ||||||||||||
% of Net earned premiums | 23.5 | % | 31.0 | % | (7.5) pts |
Three Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Policy acquisition costs | $ | 25,545 | $ | 23,570 | $ | 1,975 | |||||||||||
Operating and underwriting | 3,274 | 3,820 | (546) | ||||||||||||||
General and administrative | 6,583 | 8,208 | (1,625) | ||||||||||||||
Total Operating Expenses | $ | 35,402 | $ | 35,598 | $ | (196) | |||||||||||
% of Gross earned premiums | 22.4 | % | 27.5 | % | (5.1) pts | ||||||||||||
% of Net earned premiums | 42.6 | % | 55.2 | % | (12.6) pts |
($ in thousands) | Three Months Ended June 30, | |||||||||||||||||||
2023 | 2022 | Change | ||||||||||||||||||
Direct Written and Assumed Premium by State (1) | ||||||||||||||||||||
Florida | $ | 236,766 | $ | 179,188 | $ | 57,578 | ||||||||||||||
Texas | — | 1,803 | (1,803) | |||||||||||||||||
South Carolina | — | (78) | 78 | |||||||||||||||||
Total direct written premium by state | 236,766 | 180,913 | 55,853 | |||||||||||||||||
Assumed premium (2) | 56 | 154 | (98) | |||||||||||||||||
Total gross written premium by state | $ | 236,822 | $ | 181,067 | $ | 55,755 |
Three Months Ended June 30, | |||||||||||||||||
New and Renewal Policies(1) by State (2) | 2023 | 2022 | Change | ||||||||||||||
Florida | 1,457 | 1,956 | (499) | ||||||||||||||
Texas | — | 14 | (14) | ||||||||||||||
South Carolina | — | 1 | (1) | ||||||||||||||
Total | 1,457 | 1,971 | (514) |
Three Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Net loss and LAE | $ | 16,245 | $ | 8,194 | $ | 8,051 | |||||||||||
% of Gross earned premiums | 11.1 | % | 7.2 | % | 3.9 pts | ||||||||||||
% of Net earned premiums | 22.0 | % | 15.9 | % | 6.1 pts | ||||||||||||
Less: | |||||||||||||||||
Current year catastrophe losses | $ | 6,201 | $ | (2,587) | $ | 8,788 | |||||||||||
Prior year reserve (favorable) development | (5,337) | (1,886) | (3,451) | ||||||||||||||
Underlying loss and LAE (1) | $ | 15,381 | $ | 12,667 | $ | 2,714 | |||||||||||
% of Gross earned premiums | 10.5 | % | 11.2 | % | (0.7) pts | ||||||||||||
% of Net earned premiums | 20.8 | % | 24.6 | % | (3.8) pts |
Three Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Policy acquisition costs | $ | 23,526 | $ | 19,928 | $ | 3,598 | |||||||||||
Operating and underwriting | 1,501 | 1,127 | 374 | ||||||||||||||
General and administrative | 2,631 | 2,421 | 210 | ||||||||||||||
Total Operating Expenses | $ | 27,658 | $ | 23,476 | $ | 4,182 | |||||||||||
% of Gross earned premiums | 19.0 | % | 20.7 | % | (1.7) pts | ||||||||||||
% of Net earned premiums | 37.4 | % | 45.6 | % | (8.2) pts |
($ in thousands, policies in ones) | Three Months Ended June 30, | |||||||||||||||||||
2023 | 2022 | Change | ||||||||||||||||||
Direct Written Premium | $ | 7,063 | $ | 4,984 | $ | 2,079 | ||||||||||||||
Assumed Premiums | — | 21,581 | (21,581) | |||||||||||||||||
Total gross written premium | $ | 7,063 | $ | 26,565 | $ | (19,502) | ||||||||||||||
New and Renewal Policies (1) | 4,563 | 10,991 | (6,428) |
Three Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Net loss and LAE | $ | 4,670 | $ | 5,838 | $ | (1,168) | |||||||||||
% of Gross earned premiums | 37.7 | % | 35.9 | % | 1.8 pts | ||||||||||||
% of Net earned premiums | 50.9 | % | 44.6 | % | 6.3 pts | ||||||||||||
Less: | |||||||||||||||||
Current year catastrophe losses | $ | 340 | $ | 475 | $ | (135) | |||||||||||
Prior year reserve (favorable) development | 186 | (1,991) | 2,177 | ||||||||||||||
Underlying loss and LAE (1) | $ | 4,144 | $ | 7,354 | $ | (3,210) | |||||||||||
% of Gross earned premiums | 33.5 | % | 45.2 | % | (11.7) pts | ||||||||||||
% of Net earned premiums | 45.2 | % | 56.2 | % | (11.0) pts |
Three Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Policy acquisition costs | $ | 2,019 | $ | 3,642 | $ | (1,623) | |||||||||||
Operating and underwriting | 1,669 | 2,606 | (937) | ||||||||||||||
General and administrative | 3,772 | 5,285 | (1,513) | ||||||||||||||
Total Operating Expenses | $ | 7,460 | $ | 11,533 | $ | (4,073) | |||||||||||
% of Gross earned premiums | 60.2 | % | 70.9 | % | (10.7) pts | ||||||||||||
% of Net earned premiums | 81.2 | % | 88.1 | % | (6.9) pts |
($ in thousands) | Six Months Ended June 30, | |||||||||||||||||||
2023 | 2022 | Change | ||||||||||||||||||
Direct Written and Assumed Premium by State (1) | ||||||||||||||||||||
Florida | $ | 413,377 | $ | 304,952 | $ | 108,425 | ||||||||||||||
New York | 17,545 | 9,667 | 7,878 | |||||||||||||||||
South Carolina | — | 15 | (15) | |||||||||||||||||
Texas | (9) | 3,789 | (3,798) | |||||||||||||||||
Total direct written premium by region | 430,913 | 318,423 | 112,490 | |||||||||||||||||
Assumed premium (2) | 95 | 31,623 | (31,528) | |||||||||||||||||
Total gross written premium by region | $ | 431,008 | $ | 350,046 | $ | 80,962 | ||||||||||||||
Gross Written Premium by Line of Business | ||||||||||||||||||||
Commercial property | 413,463 | 309,031 | 104,432 | |||||||||||||||||
Personal property | $ | 17,545 | $ | 41,015 | $ | (23,470) | ||||||||||||||
Total gross written premium by line of business | $ | 431,008 | $ | 350,046 | $ | 80,962 |
Six Months Ended June 30, | |||||||||||||||||
New and Renewal Policies (1) By State (2) | 2023 | 2022 | Change | ||||||||||||||
Florida | 2,614 | 3,428 | (814) | ||||||||||||||
New York | 10,700 | 20,943 | (10,243) | ||||||||||||||
Texas | — | 32 | (32) | ||||||||||||||
South Carolina | — | 2 | (2) | ||||||||||||||
Total | 13,314 | 24,405 | (11,091) |
Six Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Net loss and LAE | $ | 37,327 | $ | 40,347 | $ | (3,020) | |||||||||||
% of Gross earned premiums | 12.3 | % | 16.0 | % | (3.7) pts | ||||||||||||
% of Net earned premiums | 21.9 | % | 33.0 | % | (11.1) pts | ||||||||||||
Less: | |||||||||||||||||
Current year catastrophe losses | $ | 9,155 | $ | 3,416 | $ | 5,739 | |||||||||||
Prior year reserve (favorable) development | (8,316) | (6,941) | (1,375) | ||||||||||||||
Underlying loss and LAE (1) | $ | 36,488 | $ | 43,872 | $ | (7,384) | |||||||||||
% of Gross earned premiums | 12.1 | % | 17.4 | % | (5.3) pts | ||||||||||||
% of Net earned premiums | 21.4 | % | 35.9 | % | (14.5) pts |
Six Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Policy acquisition costs | $ | 52,517 | $ | 43,878 | $ | 8,639 | |||||||||||
Operating and underwriting | 5,442 | 7,527 | (2,085) | ||||||||||||||
General and administrative | 15,376 | 16,272 | (896) | ||||||||||||||
Total operating expenses | $ | 73,335 | $ | 67,677 | $ | 5,658 | |||||||||||
% of Gross earned premiums | 24.2 | % | 26.8 | % | (2.6) pts | ||||||||||||
% of Net earned premiums | 43.0 | % | 55.3 | % | (12.3) pts |
($ in thousands) | Six Months Ended June 30, | |||||||||||||||||||
2023 | 2022 | Change | ||||||||||||||||||
Direct Written and Assumed Premium by State (1) | ||||||||||||||||||||
Florida | $ | 413,377 | $ | 304,952 | $ | 108,425 | ||||||||||||||
South Carolina | — | 15 | (15) | |||||||||||||||||
Texas | (9) | 3,789 | (3,798) | |||||||||||||||||
Total direct written premium by region | 413,368 | 308,756 | 104,612 | |||||||||||||||||
Assumed premium (2) | 95 | 275 | (180) | |||||||||||||||||
Total gross written premium by region | $ | 413,463 | $ | 309,031 | $ | 104,432 |
Six Months Ended June 30, | |||||||||||||||||
New and Renewal Policies(1) by State (2) | 2023 | 2022 | Change | ||||||||||||||
Florida | 2,614 | 3,428 | (814) | ||||||||||||||
Texas | — | 32 | (32) | ||||||||||||||
South Carolina | — | 2 | (2) | ||||||||||||||
Total | 2,614 | 3,462 | (848) |
Six Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Net loss and LAE | $ | 30,146 | $ | 22,308 | $ | 7,838 | |||||||||||
% of Gross earned premiums | 10.8 | % | 10.1 | % | 0.7 pts | ||||||||||||
% of Net earned premiums | 19.7 | % | 23.0 | % | (3.3) pts | ||||||||||||
Less: | |||||||||||||||||
Current year catastrophe losses | $ | 8,298 | $ | 518 | $ | 7,780 | |||||||||||
Prior year reserve (favorable) development | (8,107) | (3,689) | (4,418) | ||||||||||||||
Underlying loss and LAE (1) | $ | 29,955 | $ | 25,479 | $ | 4,476 | |||||||||||
% of Gross earned premiums | 10.8 | % | 11.5 | % | (0.7) pts | ||||||||||||
% of Net earned premiums | 19.6 | % | 26.3 | % | (6.7) pts |
Six Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Policy acquisition costs | $ | 48,692 | $ | 36,606 | $ | 12,086 | |||||||||||
Operating and underwriting | 1,597 | 2,236 | (639) | ||||||||||||||
General and administrative | 5,385 | 4,741 | 644 | ||||||||||||||
Total Operating Expenses | $ | 55,674 | $ | 43,583 | $ | 12,091 | |||||||||||
% of Gross earned premiums | 20.0 | % | 19.7 | % | 0.3 pts | ||||||||||||
% of Net earned premiums | 36.5 | % | 45.0 | % | (8.5) pts |
($ in thousands) | Six Months Ended June 30, | |||||||||||||||||||
2023 | 2022 | Change | ||||||||||||||||||
Direct Written Premium | $ | 17,545 | $ | 9,667 | $ | 7,878 | ||||||||||||||
Assumed Premiums | — | 31,348 | (31,348) | |||||||||||||||||
Total gross written premium by region | $ | 17,545 | $ | 41,015 | $ | (23,470) | ||||||||||||||
New and Renewal Policies (1) | 10,700 | 20,943 | (10,243) |
Six Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Net loss and LAE | $ | 7,181 | $ | 18,039 | $ | (10,858) | |||||||||||
% of Gross earned premiums | 28.9 | % | 57.2 | % | (28.3) pts | ||||||||||||
% of Net earned premiums | 40.2 | % | 71.1 | % | (30.9) pts | ||||||||||||
Less: | |||||||||||||||||
Current year catastrophe losses | $ | 858 | $ | 2,898 | $ | (2,040) | |||||||||||
Prior year reserve (favorable) development | (209) | (3,252) | 3,043 | ||||||||||||||
Underlying loss and LAE (1) | $ | 6,532 | $ | 18,393 | $ | (11,861) | |||||||||||
% of Gross earned premiums | 26.3 | % | 58.3 | % | (32.0) pts | ||||||||||||
% of Net earned premiums | 36.5 | % | 72.4 | % | (35.9) pts |
Six Months Ended June 30, | |||||||||||||||||
2023 | 2022 | Change | |||||||||||||||
Policy acquisition costs | $ | 3,825 | $ | 7,272 | $ | (3,447) | |||||||||||
Operating and underwriting | 3,617 | 5,113 | (1,496) | ||||||||||||||
General and administrative | 9,679 | 10,648 | (969) | ||||||||||||||
Total Operating Expenses | $ | 17,121 | $ | 23,033 | $ | (5,912) | |||||||||||
% of Gross earned premiums | 69.0 | % | 73.0 | % | (4.0) pts | ||||||||||||
% of Net earned premiums | 95.9 | % | 90.7 | % | 5.2 pts |
Exhibit | Description | |||||||
Second Certificate of Amendment of Certificate of Incorporation. (included as Exhibit 3.1 to the Form 8-K filed on July 14, 2023, and incorporated herein by reference.) | ||||||||
First Amendment to the Amended And Restated Bylaws. (included as Exhibit 3.2 to the Form 8-K filed on July 14, 2023, and incorporated herein by reference.) | ||||||||
Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act. | ||||||||
Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act. | ||||||||
Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act. | ||||||||
Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act. | ||||||||
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||
101.SCH | Inline XBRL Taxonomy Extension Schema | |||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase | |||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase | |||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase | |||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase | |||||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document and included in Exhibit 101). |
AMERICAN COASTAL INSURANCE CORPORATION | ||||||||
August 21, 2023 | By: | /s/ R. Daniel Peed | ||||||
R. Daniel Peed, Chief Executive Officer (principal executive officer and duly authorized officer) |
August 21, 2023 | By: | /s/ B. Bradford Martz | ||||||
B. Bradford Martz, Chief Financial Officer and President (principal financial officer and principal accounting officer) |
/s/ R. Daniel Peed | |||||
R. Daniel Peed Chief Executive Officer (principal executive officer) | |||||
August 21, 2023 |
/s/ B. Bradford Martz | |||||
B. Bradford Martz President and Chief Financial Officer (principal financial officer and principal accounting officer) | |||||
August 21, 2023 |
By: | /s/ R. Daniel Peed | |||||||
R. Daniel Peed Chief Executive Officer (principal executive officer) | August 21, 2023 |
By: | /s/ B. Bradford Martz | |||||||
B. Bradford Martz President and Chief Financial Officer (principal financial officer and principal accounting officer) | August 21, 2023 |
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Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0 | $ 0.0001 |
Preferred stock, authorized shares | 1,000,000 | 1,000,000 |
Preferred stock, issued shares | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 |
Common stock, par value | $ 0 | $ 0.0001 |
Common stock, authorized shares | 100,000,000 | 100,000,000 |
Common stock, issued shares | 43,618,569 | 43,492,256 |
Common Stock, Shares, Outstanding | 43,406,486 | 43,280,173 |
Treasury stock | 212,083 | 212,083 |
Financing Receivable, Allowance for Credit Loss | $ 0 | $ 0 |
Premium Receivable, Allowance for Credit Loss | 28 | 32 |
Reinsurance Recoverable, Allowance for Credit Loss | 169 | 333 |
Fixed Maturities | ||
Schedule of Available-for-sale Securities | ||
Fixed maturities, cost | 185,046 | 237,735 |
Other Long-term Investments | ||
Schedule of Available-for-sale Securities | ||
Fixed maturities, cost | $ 3,403 | $ 3,072 |
Organization, Consolidation and Presentation |
6 Months Ended |
---|---|
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure | ORGANIZATION, CONSOLIDATION AND PRESENTATION (a)Business American Coastal Insurance Corporation (referred to in this document as we, our, us, the Company or ACIC) is a property and casualty insurance holding company that sources, writes and services residential commercial and personal property and casualty insurance policies using a network of agents and two wholly-owned insurance subsidiaries. On July 10, 2023, we changed our corporate name from United Insurance Holdings Corp. to American Coastal Insurance Corporation. Our two insurance subsidiaries are Interboro Insurance Company (IIC), acquired via merger on April 29, 2016; and American Coastal Insurance Company (AmCoastal), acquired via merger on April 3, 2017. Our other subsidiaries include United Insurance Management, L.C. (UIM), a managing general agent; Skyway Claims Services, LLC, which provides claims adjusting services to AmCoastal; AmCo Holding Company, LLC (AmCo) which is a holding company subsidiary that consolidates its respective insurance company; BlueLine Cayman Holdings (BlueLine), which reinsures portfolios of excess and surplus policies; UPC Re, which provides a portion of the reinsurance protection purchased by our insurance subsidiaries when needed; Skyway Reinsurance Services, LLC, which provides reinsurance brokerage services for our insurance companies; Skyway Legal Services, LLC (SLS), which provides claims litigation services to our insurance companies; and Skyway Technologies, LLC (SCS), a managing general agent that provides technological and distribution services to our insurance companies. Our primary products are commercial and homeowners' residential property insurance. We currently offer commercial residential insurance in Florida. During 2022, we also wrote commercial residential insurance in South Carolina and Texas, however, effective May 1, 2022, we no longer write in these states. In addition, we write personal residential insurance in New York. During 2022, we wrote personal residential business in six other states; however on February 27, 2023, our former insurance subsidiary, United Property & Casualty Insurance Company (UPC) was placed into receivership with the Florida Department of Financial Services (DFS), which divested our ownership of UPC. The events leading to receivership and results of this subsidiary, now included within discontinued operations, are discussed in Note 3 below. On August 25, 2022, we announced that our former subsidiary UPC had filed plans for withdrawal in the states of Florida, Louisiana, and Texas and intended to file a plan for withdrawal in the state of New York. All filed plans entail non-renewing personal lines policies in these states. Additionally, we announced that Demotech, Inc. (Demotech), an insurance rating agency, notified UPC of its intent to withdraw UPC's Financial Stability Rating. On December 5, 2022, the Florida Office of Insurance Regulation ("FLOIR") issued Consent Order No. 303643-22- CO that provided for the administrative supervision and approval of the plan of run-off for UPC (the "Consent Order"). The Consent Order provided formal approval of UPC's Plan of Run-Off (the "Plan") to facilitate a solvent wind down of its affairs in an orderly fashion. Additionally, in connection with the Plan, IIC agreed to not pay ordinary dividends without the prior approval of the New York Department of Financial Services until January 1, 2025. On February 10, 2023, we announced that a solvent run-off of UPC was unlikely and on February 27, 2023, UPC was placed into receivership with the Florida Department of Financial Services (the "DFS") which divested our ownership of UPC. Effective June 1, 2022, we merged our majority-owned insurance subsidiary, Journey Insurance Company (JIC) into AmCoastal, with AmCoastal being the surviving entity. JIC was formed in strategic partnership with a subsidiary of Tokio Marine Kiln Group Limited (Kiln) on August 30, 2018 and operated independently from AmCoastal prior to the merging of the entities. The Kiln subsidiary held a noncontrolling interest in JIC, which was terminated prior to the merger. Effective June 1, 2022, we entered into a quota share reinsurance agreement with TypTap Insurance Company (Typtap). Under the terms of this agreement, we ceded 100% of our former subsidiary UPC's in-force, new, and renewal policies in the states of Georgia, North Carolina and South Carolina. Effective June 1, 2022, we began the transition of South Carolina policies to Homeowners Choice Property and Casualty Insurance Company, Inc. (HCPCI) in connection with our renewal rights agreement. Effective October 1, 2022, we transitioned Georgia policies to HCPCI in connection with our renewal rights agreement. Effective December 1, 2022, we began the transition of North Carolina policies to HCPCI in connection with our renewal rights agreement. As a result, these policies will no longer be covered under this agreement upon their renewal. This agreement replaces the 85% quota share agreement with HCPCI effective December 31, 2021. Effective May 31, 2022, we merged Family Security Insurance Company, Inc. (FSIC) into our former subsidiary UPC, with UPC being the surviving entity. FSIC was acquired via merger on February 3, 2015, and operated independently from UPC prior to the merging of the entities. In conjunction with the merger, we dissolved Family Security Holdings (FSH), a holding company subsidiary that consolidated its respective insurance company, FSIC. Effective June 1, 2021, we entered into a quota share reinsurance agreement with HCPCI and TypTap. Under the terms of this agreement, we ceded 100% of our former subsidiary UPC's in-force, new, and renewal policies in the states of Connecticut, New Jersey, Massachusetts, and Rhode Island. The cession of these policies was 50% to HCPCI and 50% to TypTap. HCPCI is responsible for processing all claims as a part of this agreement. As of April 1, 2022, we completed the transition of all policies in these four states to HCPCI in connection with our renewal rights agreement (Northeast Renewal Agreement) to sell UPC's personal lines homeowners business in these states. We conduct our operations under two reportable segments, commercial residential property and casualty insurance policies (commercial lines) and personal residential property and casualty insurance policies (personal lines). Our chief operating decision maker is our President, who makes decisions to allocate resources and assesses performance at both segment levels, as well as at the corporate level. (b)Consolidation and Presentation We prepare our unaudited condensed consolidated interim financial statements in conformity with U.S. generally accepted accounting principles (GAAP). We have condensed or omitted certain information and footnote disclosures normally included in the annual consolidated financial statements presented in accordance with GAAP. In management's opinion, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, including normal recurring items, considered necessary for a fair presentation of interim periods. We include all of our subsidiaries in our consolidated financial statements, eliminating intercompany balances and transactions during consolidation. As described in Note 2, our former subsidiary, UPC, and activities related directly to supporting the business conducted by UPC qualify as discontinued operations. Our unaudited condensed consolidated interim financial statements and footnotes should be read in conjunction with our consolidated financial statements and footnotes in our Annual Report on Form 10-K for the year ended December 31, 2022. While preparing our unaudited condensed consolidated financial statements, we make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, as well as reported amounts of revenues and expenses during the reporting period. Accordingly, actual results could differ from those estimates. Reported amounts that require us to make extensive use of estimates include our reserves for unpaid losses and loss adjustment expenses, investments and goodwill. Except for the captions on our Unaudited Condensed Consolidated Balance Sheets and Unaudited Condensed Consolidated Statements of Comprehensive Loss, we generally use the term loss(es) to collectively refer to both loss and loss adjustment expenses. Our results of operations and our cash flows as of the end of the interim periods reported herein do not necessarily indicate our results for the remainder of the year or for any other future period. (c) Going Concern Our unaudited condensed consolidated interim financial statements have been prepared in accordance with GAAP assuming the Company will continue as a going concern. As disclosed in our Annual Report on Form 10-K for the year ended December 31, 2022, our subsidiary AmCoastal is a part of a combined reinsurance program with our former subsidiary, UPC. To properly allocate the reinsurance recoverables under the shared catastrophe treaties, UPC and AmCoastal entered into a reinsurance allocation agreement that became effective on June 1, 2022 (the "Allocation Agreement"). The Allocation Agreement was filed with and approved by the FLOIR on December 5, 2022. On February 10, 2023, we announced that a solvent run-off of UPC was unlikely, driven by Hurricane Ian losses which exhausted UPC's reinsurance coverage. On February 27, 2023, UPC was placed into receivership with the DFS which divested our ownership of UPC. As of the date of filing our Annual Report, the DFS had not recognized the Allocation Agreement, leaving uncertainty regarding the timing of both recoveries currently held by UPC that are allocated to AmCoastal and future recoverables. Management also believed that the ability for AmCoastal to obtain adequate reinsurance to meet its needs for the June 1, 2023 to May 31, 2024 catastrophe cover could only be accomplished assuming that recoveries due to AmCoastal pursuant to the Allocation Agreement could be resolved in short order. However, on April 19, 2023, AmCoastal entered into a Memorandum of Understanding with the DFS. Under the terms of the Memorandum, AmCoastal and the DFS as receiver of UPC have reached the following agreement: 1.The DFS adopts, ratifies and affirms the Allocation Agreement. 2.All future reinsurance recoverable under reinsurance agreements applicable to the Allocation Agreement for Hurricane Ian losses shall be paid, either directly from the reinsurers or directly from the reinsurance intermediary responsible therefor, to AmCoastal. If a true up adjustment demonstrates that any future reinsurance recoveries were over-collected by AmCoastal, AmCoastal will remit any over-payment to UPC. On May 15, 2023, the Company, together with it's subsidiary, AmCoastal, entered into a Tax Memorandum of Understanding (the "Tax Memorandum") with the DFS as receiver of the Company's former subsidiary, UPC. On February 27, 2023, UPC entered into receivership with the DFS as receiver. As of March 31, 2023, in accordance with the various reinsurance allocation agreements including the Allocation Agreement described above, the Company is due approximately $38,352,000 of net reinsurance recoveries received by UPC on behalf of the Company but not settled prior to receivership. In addition, in April ACIC paid reinsurance premiums on behalf of UPC totaling $12,929,000. The Company and the DFS believe that an opportunity exists to settle these balances via the realization of certain deferred tax assets of the Company's consolidated Federal and Florida tax returns to which ACIC and UPC belong. UPC holds certain deferred tax assets that are believed to be on no value to UPC on a stand-alone basis. However, AmCoastal and the Company have the opportunity, subject to certain conditions such as continuing and adequate profitability, to realize these assets. Under the terms of the Tax Memorandum, the Company, AmCoastal and the DFS as receiver of UPC have reached the following agreement: 1.The parties agree to cooperate with one another to achieve realization of the deferred tax assets; 2.The parties agree to deposit the funds that are or may be due to UPC pursuant to the Tax Allocation Agreement into a segregated account (the "DTA Account") held by AmCoastal that will serve as collateral for any amount payable from or to UPC; 3.The parties agree that the Federal Income Tax Allocation Agreement entered into prior to UPC’s receivership is ratified and accepted by all parties; 4.The parties agree to an annual “true up” of the allocation of the disputed recoveries to the extent that such recoveries were not allocated correctly according to the Reinsurance Allocation Agreement; 5.In the event that AmCoastal, ACIC, or any of their affiliates make a claim or file a proof of claim in the UPC estate, the reviewed, approved, and/or adjudicated claim shall be reduced by the amount of (a) any tax benefit collectively received by AmCoastal, ACIC, or any of their affiliates as well as (b) any money withdrawn from the DTA Account for the benefit of any entity other than UPC; and 6.In the event that the benefit received by the Company is greater than the disputed recoveries, the difference shall be paid to DFS as receiver of UPC. The Tax Memorandum allows the Company to secure amounts due from UPC to AmCoastal provided the Internal Revenue Service does not object to the Company utilizing UPC's net operating loss carry-forward against its future taxable income. We believe probability of the Internal Revenue Service (IRS) allowing the Company to utilize UPC's net operating losses is more likely than not based on other entities having successfully accomplished this and prior permission or approval from the IRS not being required. The execution of these MOUs prior to June 30, 2023 alleviate the uncertainty regarding future recoverables, and recoveries currently held by UPC. In addition, as of March 31, 2023, the Company had not finalized its catastrophe cover for June 1, 2023 to May 31, 2024. However, as of June 30, 2023, the Company has finalized this cover, alleviating the uncertainty of this placement. As a result, the Company has concluded substantial doubt no longer exists regarding its ability to continue as a going concern.
|
Significant Accounting Policies Significant Accounting Policies |
6 Months Ended |
---|---|
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | SIGNIFICANT ACCOUNTING POLICIES (a) Income Taxes In June 2022, we assessed our deferred tax position and believed it was more likely than not that the benefit from certain net operating loss (NOL) carryforwards, net capital operating loss carryforwards and other net deferred tax assets would not be realized. In recognition of this risk, we recorded a valuation allowance against these deferred tax assets as of June 30, 2022. During the second quarter of 2023, we evaluated our position based on the results of our continuing operations and determined that it is more likely than not that we will be able to realize the benefit from these NOL carryforwards and other net deferred tax assets. Accordingly, we have reversed the valuation allowance on these deferred tax assets, totaling $2,223,000. On May 15, we entered into the Tax Memorandum with DFS, as described in Note 1 above. As a result of this Memorandum, any benefit received from the use of UPC's net operating losses are due to to the DFS as receiver of UPC. The expense related to this remittance is presented within our provision for income taxes on our Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss), offsetting the tax benefit recognized. (b) Changes to Significant Accounting Policies During the three months ended March 31, 2023, our former subsidiary, UPC, was placed into receivership with the DFS. As described in Note 1, effective February 27, 2023, this receivership divested our ownership of UPC. This disposal, as well as the activities related directly to supporting the business conducted by UPC were evaluated for qualification as discontinued operations. The results of operations of business are reported as discontinued operations when the disposal represents a strategic shift that will have a major effect on the entity's operations and financial results. When a business is identified for discontinued operations reporting: •Results for prior periods are retroactively reclassified as discontinued operations; •Results of operations are reported in a single line, net of tax, in the Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss); and •Assets and liabilities are reported as held for disposal in the Unaudited Condensed Consolidated Balance Sheets Additional details by major classification of operating results and financial position are included in Note 3. There have been no other changes to our significant accounting policies as reported in our Annual Report on Form 10-K for the year ended December 31, 2022. (c) Pending Accounting Pronouncements We have evaluated pending accounting pronouncements and do not believe any would have an impact on the operations or financial reporting of our company.
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Discontinued Operations and Disposal Groups |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disposal Groups, Income Statement Disclosure | 3) DISCONTINUED OPERATIONS On August 25, 2022, we announced that our former subsidiary UPC had filed plans for withdrawal in the states of Florida, Louisiana, and Texas and intended to file a plan for withdrawal in the state of New York. All filed plans entailed non-renewing personal lines policies in these states. Additionally, we announced that Demotech, an insurance rating agency, notified UPC of its intent to withdraw UPC's Financial Stability Rating. On December 5, 2022, the FLOIR issued Consent Order No. 303643-22- CO that provided for the administrative supervision and approval of the plan of run-off for UPC (the "Consent Order"). The Consent Order provided formal approval of UPC's Plan of Run-Off (the "Plan") to facilitate a solvent wind down of its affairs in an orderly fashion. On February 10, 2023, we announced that a solvent run-off of UPC was unlikely, driven by Hurricane Ian losses which exhausted UPC's reinsurance coverage. On February 27, 2023, UPC was placed into receivership with the DFS which divested our ownership of UPC. In the first quarter of 2023, the assets and liabilities of UPC were divested. In addition, activities provided by our entities, SCS, SLS and UIM, related directly to supporting the business conducted by UPC have been included. The assets and liabilities for the balance sheet as of December 31, 2022 are reclassified as held for disposal retrospectively, and the results of UPC and activities related directly to supporting the business conducted by UPC are presented as discontinued operations for all periods presented. The results from discontinued operations for the three and six months ended June 30, 2023 and 2022 are presented below.
As of February 28, 2023, the Company completed the disposal of its former subsidiary, UPC. This divestiture resulted in a gain of $238,440,000 for the three months ended March 31, 2023. This gain was driven by the negative equity position of UPC. The major classes of assets and liabilities transferred as a result of the transaction as of the date of transfer and December 31, 2022 are presented below.
(1) The Company divested its ownership on February 27, 2023, the date the DFS was appointed as receiver of the entity. In addition, the major classes of assets and liabilities remaining related to activities directly supporting the business conducted by UPC are outlined in the table below as of June 30, 2023 and December 31, 2022.
The discontinued operations of the Company incurred $488,000 and $748,000 of amortization expense during the six months ended June 30, 2023 and 2022, respectively. There were no other noncash transactions for either period.
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Segment Reporting |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Disclosure | ) SEGMENT REPORTING Personal Lines Business Our personal lines business provides structure, content and liability coverage for standard single-family homeowners, renters and condominium unit owners, through our subsidiary IIC. Personal residential products are offered in New York. We include coverage to policyholders for loss or damage to dwellings, detached structures or equipment caused by covered causes of loss such as fire, wind, hail, water, theft and vandalism. We have developed a unique and proprietary homeowners’ product. This product uses a granular approach to pricing for catastrophe perils. We have focused on using independent agencies as a channel of distribution for our personal lines business. All of our personal lines business is managed internally. Commercial Lines Business Our commercial lines business primarily provides commercial multi-peril property insurance for residential condominium associations and apartments in Florida, through our subsidiary AmCoastal. We include coverage to policyholders for loss or damage to buildings, inventory or equipment caused by covered causes of loss such as fire, wind, hail, water, theft and vandalism. We also wrote commercial residential coverage through our subsidiary JIC, in South Carolina and Texas. Effective June 1, 2022, JIC was merged into AmCoastal, with AmCoastal being the surviving entity. As a result, the commercial residential policies originally written by JIC were not renewed effective May 31, 2022. All of our commercial lines business is administered by an outside managing general underwriter, AmRisc, LLC (AmRisc). This includes handling the underwriting, claims processing and premium collection related to our commercial business. In return, AmRisc is reimbursed through monthly management fees. International Catastrophe Insurance Managers (ICAT) handled the underwriting and premium collection for JIC’s commercial business written in South Carolina and Texas and was also reimbursed through monthly management fees. Effective May 31, 2022, the Company terminated its agreement with ICAT. Please note the following similarities pertaining to the accounting and transactions of our operating segments for the three and six months ended June 30, 2023 and 2022: •Both operating segments follow the accounting policies as reported in our Annual Report on Form 10-K for the year ended December 31, 2022; •Neither operating segment experienced significant noncash transactions outside of depreciation and amortization for the three and six months ended June 30, 2023 and 2022. The tables below present the information for each of the reportable segment's profit or loss, as well as segment assets for the three and six months ended June 30, 2023 and 2022. We have restated our segments to reflect the discontinued operations disclosed in Note 3, excluding the result of the entity for all periods presented.
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations. (2) Included in our General and Administrative expenses is $996,000 and $811,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. (3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below. (4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses. (5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses. (6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations. (2) Included in our General and Administrative expenses is $1,047,000 and $877,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. (3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below. (4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses. (5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses. (6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations. (2) Included in our General and Administrative expenses is $2,003,000 and $1,623,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. (3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below. (4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses. (5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses. (6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations. (2) Included in our General and Administrative expenses is $2,121,000 and $1,762,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. (3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below. (4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses. (5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses. (6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
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Investments |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments | INVESTMENTS The following table details fixed-maturity available-for-sale securities, by major investment category, at June 30, 2023 and December 31, 2022:
Equity securities are summarized as follows:
When we sell investments, we calculate the gain or loss realized on the sale by comparing the sales price (fair value) to the cost or adjusted/amortized cost of the security sold. We determine the cost or adjusted/amortized cost of the security sold using the specific-identification method. The following table details our realized gains (losses) by major investment category for the three and six months ended June 30, 2023 and 2022, respectively:
The table below summarizes our fixed maturities at June 30, 2023 by contractual maturity periods. Actual results may differ as issuers may have the right to call or prepay obligations, with or without penalties, prior to the contractual maturities of those obligations.
The following table summarizes our net investment income by major investment category:
Portfolio monitoring We have a quarterly portfolio monitoring process to identify and evaluate each fixed-income security whose carrying value may be impaired as the result of a credit loss. For each fixed-income security in an unrealized loss position, if we determine that we intend to sell the security or that it is more likely than not that we will be required to sell the security before recovery of the cost or amortized cost basis for reasons such as liquidity needs, contractual or regulatory requirements, the security's entire decline in fair value is recorded in earnings. If our management decides not to sell the fixed-income security and it is more likely than not that we will not be required to sell the fixed-income security before recovery of its amortized cost basis, we evaluate whether the decline in fair value has resulted from credit losses or other factors. This is typically indicated by a change in the rating of the security assigned by a rating agency, and any adverse conditions specifically related to the security or industry, among other factors. If the assessment indicates that a credit loss may exist, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses will be recorded in earnings. Credit loss is limited to the difference between a security's amortized cost basis and its fair value. Any additional impairment not recorded through an allowance for credit losses is recognized in other comprehensive loss. During the three and six months ended June 30, 2023, we determined that none of our fixed-income securities shown in the table below that are in an unrealized loss position have declines in fair value that are reflected as a result of credit losses. Therefore, no credit loss allowance was recorded at June 30, 2023. The issuers of our debt security investments continue to make interest payments on a timely basis. We do not intend to sell, nor is it likely that we would be required to sell the debt securities before we recover our amortized cost basis. Equity securities are reported at fair value with changes in fair value recognized in the valuation of equity investments. The following table presents an aging of our unrealized investment losses by investment class:
(1) This amount represents the actual number of discrete securities, not the number of shares or units of those securities. The numbers are not presented in thousands. Fair value measurement Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The hierarchy for inputs used in determining fair value maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Assets and liabilities recorded on our Unaudited Condensed Consolidated Balance Sheets at fair value are categorized in the fair value hierarchy based on the observability of inputs to the valuation techniques as follows: Level 1: Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that we can access. Level 2: Assets and liabilities whose values are based on the following: (a) Quoted prices for similar assets or liabilities in active markets; (b) Quoted prices for identical or similar assets or liabilities in markets that are not active; or (c) Valuation models whose inputs are observable, directly or indirectly, for substantially the full term of the asset or liability. Level 3: Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Unobservable inputs reflect our estimates of the assumptions that market participants would use in valuing the assets and liabilities. We estimate the fair value of our investments using the closing prices on the last business day of the reporting period, obtained from active markets such as the NYSE, Nasdaq and NYSE American. For securities for which quoted prices in active markets are unavailable, we use a third-party pricing service that utilizes quoted prices in active markets for similar instruments, benchmark interest rates, broker quotes and other relevant inputs to estimate the fair value of those securities for which quoted prices are unavailable. Our estimates of fair value reflect the interest rate environment that existed as of the close of business on June 30, 2023 and December 31, 2022. Changes in interest rates subsequent to June 30, 2023 may affect the fair value of our investments. The fair value of our fixed maturities is initially calculated by a third-party pricing service. Valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of proprietary models, produce valuation information in the form of a single fair value for individual fixed-income and other securities for which a fair value has been requested. The inputs used by the valuation service providers include, but are not limited to, market prices from recently completed transactions and transactions of comparable securities, interest rate yield curves, credit spreads, liquidity spreads, currency rates and other information, as applicable. Credit and liquidity spreads are typically implied from completed transactions and transactions of comparable securities. Valuation service providers also use proprietary discounted cash flow models that are widely accepted in the financial services industry and similar to those used by other market participants to value the same financial information. The valuation models take into account, among other things, market observable information as of the measurement date, as described above, as well as the specific attributes of the security being valued, including its term, interest rate, credit rating, industry sector and, where applicable, collateral quality and other issue or issuer specific information. Executing valuation models effectively requires seasoned professional judgment and experience. Any change in the estimated fair value of our fixed-income securities would impact the amount of unrealized gain or loss we have recorded, which could change the amount we have recorded for our investments and other comprehensive loss on our Unaudited Condensed Consolidated Balance Sheet as of June 30, 2023. The following table presents the fair value of our financial instruments measured on a recurring basis by level at June 30, 2023 and December 31, 2022:
(1) Other investments included in the fair value hierarchy exclude these limited partnership interests that are measured at estimated fair value using the net asset value per share (or its equivalent) practical expedient. Certain financial assets and financial liabilities are measured at fair value on a non-recurring basis; this is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). There were no financial instruments measured on a non-recurring basis at June 30, 2023 and December 31, 2022. The carrying amounts for the following financial instrument categories approximate their fair values at June 30, 2023 and December 31, 2022, because of their short-term nature: cash and cash equivalents, accrued investment income, premiums receivable, reinsurance recoverable, reinsurance payable, other assets, and other liabilities. The carrying amount of our senior notes approximate fair value as the interest rates and terms are variable. We are responsible for the determination of fair value and the supporting assumptions and methodologies. We have implemented a system of processes and controls designed to provide assurance that our assets and liabilities are appropriately valued. For fair values received from third parties, our processes are designed to provide assurance that the valuation methodologies and inputs are appropriate and consistently applied, the assumptions are reasonable and consistent with the objective of determining fair value, and the fair values are accurately recorded. At the end of each quarter, we determine whether we need to transfer the fair values of any securities between levels of the fair value hierarchy and, if so, we report the transfer as of the end of the quarter. During the quarter ended June 30, 2023, we transferred no investments between levels. For our investments in U.S. government securities that do not have prices in active markets, agency securities, state and municipal governments, and corporate bonds, we obtain the fair values from our investment custodians, which use a third-party valuation service. The valuation service calculates prices for our investments in the aforementioned security types on a month-end basis by using several matrix-pricing methodologies that incorporate inputs from various sources. The model the valuation service uses to price U.S. government securities and securities of states and municipalities incorporates inputs from active market makers and inter-dealer brokers. To price corporate bonds and agency securities, the valuation service calculates non-call yield spreads on all issuers, uses option-adjusted yield spreads to account for any early redemption features, and adds final spreads to the U.S. Treasury curve at 3 p.m. (ET) as of quarter end. Since the inputs the valuation service uses in its calculations are not quoted prices in active markets, but are observable inputs, they represent Level 2 inputs. Other investments We acquired investments in limited partnerships, recorded in the other investments line of our Unaudited Condensed Consolidated Balance Sheets, and these investments are currently being measured at estimated fair value utilizing a net asset value per share (or its equivalent) practical expedient. The information presented in the table below is as of June 30, 2023:
(1) Distributions will be generated from investment gains, from operating income, from underlying investments of funds, and from liquidation of the underlying assets of the funds. We estimate that the underlying assets of the funds will be liquidated over the next few months to five years. Restricted Cash We are required to maintain assets on deposit with various regulatory authorities to support our insurance operations. The cash on deposit with state regulators is available to settle insurance liabilities. We also use trust funds in certain reinsurance transactions. The following table presents the components of restricted assets:
In addition to the cash held on deposit described above, we also have securities on deposit with regulators, which are presented within our Fixed Maturities or Other Investments lines on the Unaudited Condensed Balance Sheets, dependent upon if they are short-term or long-term in nature. The table below shows the carrying value of those securities held on deposit with regulators.
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Earnings per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | EARNINGS PER SHARE (EPS)Basic EPS is based on the weighted average number of common shares outstanding for the period, excluding any dilutive common share equivalents. Diluted EPS reflects the potential dilution resulting from the vesting of outstanding restricted stock awards, restricted stock units, performance stock units and stock options. The following table shows the computation of basic and diluted EPS for the three and six month periods ended June 30, 2023 and 2022, respectively:
See Note 17 of these Notes to Unaudited Condensed Consolidated Financial Statements for additional information on the stock grants related to dilutive securities.
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Property and Equipment, Net |
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Property and Equipment, Net | PROPERTY AND EQUIPMENT, NET Property and equipment, net consists of the following:
(1) Includes vehicles under financing leases. See Note 12 of these Notes to Unaudited Condensed Consolidated Financial Statements for further information on leases. Depreciation and amortization expense under property and equipment was $996,000 and $2,004,000 for the three and six months ended June 30, 2023, respectively. Depreciation and amortization expense under property and equipment was $1,230,000 and $2,502,000 for the three and six months ended June 30, 2022, respectively. During the six months ended June 30, 2023, we sold or disposed of leased vehicles totaling $1,069,000. The accumulated depreciation on these vehicles totaled $1,038,000 at the time of disposal. We realized a net gain on this disposal of $559,000. We disposed of computer hardware and software totaling $811,000. The accumulated depreciation on these systems totaled $321,000 at the time of disposal. In addition, we disposed of office furniture totaling $691,000 during the period. Accumulated depreciation at the time of this disposal totaled $644,000. During the year ended December 31, 2022, we disposed of computer hardware and software totaling $13,202,000, primarily related to the retirement of one of our policy systems for states in which we no longer write policies. The depreciation on these systems totaled $12,691,000 at the time of disposal. We also sold or disposed of leased vehicles totaling $1,222,000. The depreciation on these vehicles totaled $1,114,000 prior to disposal. The net gain on sale of these vehicles totaled $738,000. Finally, we sold three buildings and their related assets totaling $13,369,000. The depreciation on these buildings and related assets totaled $5,129,000 prior to disposal. The net realized gain on these sales totaled $12,164,000.
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Goodwill and Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets | ) GOODWILL AND INTANGIBLE ASSETS Goodwill The carrying amount of goodwill at June 30, 2023 and December 31, 2022 was $59,476,000. No impairment in the value of goodwill was recognized during the three or six month period ended June 30, 2023. As a result of the strategic decision to place our former subsidiary UPC into an orderly runoff, we recognized an impairment of our personal lines reporting unit's goodwill totaling $10,156,000 during the third quarter of 2022. The goodwill attributable to our commercial lines reporting unit was most recently tested for impairment during the fourth quarter of 2022. It was determined that there was no impairment in the value of the asset as of December 31, 2022. Goodwill allocated to our commercial lines reporting unit was $59,476,000 at June 30, 2023 and December 31, 2022. There was no goodwill allocated to our personal lines reporting unit at June 30, 2023 and December 31, 2022. There was no goodwill acquired or disposed of during the six month periods ended June 30, 2023 and 2022. Accumulated impairment related to goodwill was $10,156,000 at June 30, 2023 and December 31, 2022. Intangible Assets The following is a summary of intangible assets excluding goodwill recorded as intangible assets on our Unaudited Condensed Consolidated Balance Sheets:
(1) Indefinite-lived intangible assets are comprised of state insurance and agent licenses, as well as perpetual software licenses. Intangible assets subject to amortization consisted of the following:
No impairment in the value of amortizing or non-amortizing intangible assets was recognized during the six months ended June 30, 2023 and 2022. However during the year ended December 31, 2022, we disposed of intangible assets totaling $2,359,000. Amortization expense of our intangible assets was $811,000 and $812,000 for the three months ended June 30, 2023 and 2022, respectively. Amortization expense of our intangible assets was $1,623,000 and $1,624,000 for the six months ended June 30, 2023 and 2022, respectively. Estimated amortization expense of our intangible assets to be recognized by the Company during the remainder of 2023 and over the next five years is as follows:
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Reinsurance |
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Reinsurance Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance | ) REINSURANCE Our reinsurance program is designed, utilizing our risk management methodology, to address our exposure to catastrophes. Our program provides reinsurance protection for catastrophes, including hurricanes and tropical storms. These reinsurance agreements are part of our catastrophe management strategy, which is intended to provide our stockholders an acceptable return on the risks assumed in our property business, and to reduce variability of earnings, while providing protection to our policyholders. Although reinsurance agreements contractually obligate our reinsurers to reimburse us for the agreed-upon portion of our gross paid losses, they do not discharge our primary liability. Our program includes excess of loss and quota share treaties. Our AmCoastal catastrophe reinsurance program, in effect from June 1, 2023 through May 31, 2024, provides coverage for catastrophe losses from named or numbered windstorms and earthquakes up to an exhaustion point of approximately $1,300,000,000 in the aggregate. Under our core catastrophe excess of loss treaty, retention on a first and second event is $10,000,000 each. The exhaustion point of IIC's catastrophe reinsurance program is approximately $82,000,000 in the aggregate, with a retention of $3,000,000 per occurrence, covering all perils. During the third quarter of 2022, the Company's core catastrophe reinsurance program was impacted by Hurricane Ian. As a result, the Company has approximately $508 million of occurrence limit remaining for Hurricane Ian all of which is attributable to AmCoastal only. After reinstatement premiums of approximately $15.4 million, the Company, with its former subsidiary UPC has approximately $993 million of aggregate limit remaining after Hurricane Ian, based on our estimated ultimate net loss subject to the core catastrophe reinsurance program. Effective January 1, 2023, we renewed our all other perils catastrophe excess of loss agreement. The agreement provides protection from catastrophe loss events other than named windstorms and earthquakes up to $101,000,000. During the third quarter of 2022, one of our private reinsurers who held a 100% share of the $15,000,000 in excess of $15,000,000 layer on our all other perils catastrophe excess of loss agreement notified us of their intent to terminate the agreement due to the contractual provision regarding the change in our former subsidiary UPC's statutory surplus being greater than 25%. We agreed to a termination and commutation date of August 22, 2022 for this contract. This change resulted in approximately $1,300,000 of ceded premium savings that would have otherwise been due in the fourth quarter of 2022 and the Company retaining all the risk for any non-hurricane catastrophe losses up to $30,000,000, excluding any quota share recoveries. The table below outlines our quota share agreements in effect for the six months ended June 30, 2023 and 2022. The impacts of these quota share agreements on our former subsidiary, UPC's financial statements are included in discontinued operations.
(1) Effective May 31, 2022, FSIC was merged into UPC, with UPC being the surviving entity. (2) This treaty provides coverage for all catastrophe perils and attritional losses incurred. For all catastrophe perils, the quota share agreement provides ground- up protection effectively reducing our retention for catastrophe losses. (3) This treaty provides coverage on our in-force, new and renewal policies until these states are transitioned to HCPCI or TypTap upon renewal. (4) This treaty provides coverage on non-catastrophe losses on policies in-force on the effective date of the agreement. (5) Cessions are split 50% to HCPCI and 50% to TypTap. (6) This treaty was amended effective December 31, 2020 to include AmCoastal. Reinsurance recoverable at the balance sheet dates consists of the following:
(1) Our reinsurance recoverable balance is net of our allowance for expected credit losses. More information related to this allowance can
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Liability for Unpaid Losses and Loss Adjustment Expenses |
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Insurance [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Liability for unpaid losses and loss adjustment expenses | LIABILITY FOR UNPAID LOSSES AND LOSS ADJUSTMENT EXPENSE (LAE) We determine the reserve for unpaid losses on an individual case basis for all incidents reported. The liability also includes amounts for incurred but not reported (IBNR) claims as of the balance sheet date. The table below shows the analysis of our reserve for unpaid losses for the six months ended June 30, 2023 and 2022 on a GAAP basis:
Based upon our internal analysis and our review of the annual statement of actuarial opinion provided by our actuarial consultants at December 31, 2022, we believe that the reserve for unpaid losses reasonably represents the amount necessary to pay all claims and related expenses which may arise from incidents that have occurred as of the balance sheet date. As reflected in the table above, we had favorable development in both 2023 and 2022 related to prior year losses. This favorable development came as a result of re-estimating ultimate losses in 2023 based on historical loss trends. The loss payments made by the Company during the six months ended June 30, 2023, were higher than the loss payments made during the six months ended June 30, 2022, due to the settling of claims related to Hurricane Ian, which made landfall during the third quarter of 2022. Case and IBNR reserves and reinsurance recoverable on unpaid losses also increased when compared to the prior period as a result of Hurricane Ian.
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Long-Term Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term Debt | LONG-TERM DEBT Long-Term Debt The table below presents all long-term debt outstanding as of June 30, 2023 and December 31, 2022:
(1) Our Florida State Board of Administration Note was held by our former subsidiary, UPC. (2) Our Truist Term Note Payable was repaid in full on August 12, 2022. Senior Notes Payable On December 13, 2017, we issued $150,000,000 of 10-year senior notes (the Senior Notes) that will mature on December 15, 2027 and bear interest at a rate equal to 6.25% per annum payable semi-annually on each June 15 and December 15, commencing June 15, 2018. The Senior Notes are senior unsecured obligations of the Company. We may redeem the Senior Notes at our option, at any time and from time to time in whole or in part, prior to September 15, 2027, at a redemption price equal to the greater of (i) 100% of the principal amount of the notes to be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal and interest thereon from the date of redemption to the date that is three months prior to maturity, plus accrued and unpaid interest thereon. On or after that date, we may redeem the Senior Notes at par, plus accrued and unpaid interest thereon. On December 8, 2022, the Kroll Bond Rating Agency, LLC announced a downgrade of our issuer and debt ratings from BBB- to BB+. As a result, pursuant to our agreement, the interest rate of our Senior Notes increased from 6.25% to 7.25%. Florida State Board of Administration Note Payable On September 22, 2006, we issued a $20,000,000, 20-year note payable to the Florida State Board of Administration (the SBA Note). For the first three years of the SBA Note we were required to pay interest only. On October 1, 2009, we began to repay the principal in addition to interest. The SBA Note bears an annual interest rate equivalent to the 10-year Constant Maturity Treasury rate (as defined in the SBA Note agreement), which resets quarterly. This note was held by our former insurance subsidiary, UPC. On February 27, 2023, UPC was placed into receivership with the Florida Department of Financial Services, divesting our ownership of UPC. Truist Term Note Payable On May 26, 2016, we issued a $5,200,000, 15-year term note payable to Truist (the Truist Note), with the intent to use the funds to purchase, renovate, furnish and equip our principal executive office. The Truist Note bears interest at 1.65% in excess of the one-month LIBOR, which resets monthly. LIBOR was phased out at the end of 2021, however, the Intercontinental Exchange will continue to publish one-month LIBOR settings through 2023. The outstanding Truist Note payable balance, including applicable interest, was repaid in full on August 12, 2022. Therefore, effective August 12, 2022, Truist no longer holds our principal executive office as collateral and may not take possession of or foreclose upon the office. Financial Covenants Senior Notes - Our Senior Notes provide that the Company and its subsidiaries shall not incur any indebtedness unless no default exists and the Company’s leverage ratio as of the last day of any annual or quarterly period (the balance sheet date) immediately preceding the date on which such additional indebtedness is incurred would have been no greater than 0.3:1, determined on a pro forma basis as if the additional indebtedness and all other indebtedness incurred since the immediately preceding balance sheet date had been incurred and the proceeds therefrom applied as of such day. The Company and its subsidiaries also may not create, assume, incur or permit to exist any indebtedness for borrowed money that is secured by a lien on the voting stock of any significant subsidiary without securing the Senior Notes equally. The Company may not issue, sell, assign, transfer or otherwise dispose of, directly or indirectly, any of the capital stock of the Company’s significant subsidiaries as of the issue date of the Senior Notes (except to the Company or to one or more of the Company’s other subsidiaries, or for the purpose of qualifying directors or as may be required by law or regulation), subject to certain exceptions. At December 31, 2022, while our leverage ratio was greater than the allowed ratio above, we did not incur any additional debt during the period and as a result, we were in compliance with the covenants in the Senior Notes. SBA Note - Our SBA Note required that UPC maintained either a 2:1 ratio of net written premium to surplus, or net writing ratio, or a 6:1 ratio of gross written premium to surplus, or gross writing ratio, to avoid additional interest penalties. The SBA Note agreement defined surplus for the purpose of calculating the required ratios as the $20,000,000 of capital contributed to UPC under the agreement plus the outstanding balance of the note. Should UPC have failed to exceed either a net writing ratio of 1.5:1 or a gross writing ratio of 4.5:1, UPC's interest rate would have increased by 450 basis points above the 10-year Constant Maturity Treasury rate, which was 3.81% at the end of June 2023. Any other writing ratio deficiencies resulted in an interest rate penalty of 25 basis points above the stated rate of the note. Our SBA Note further provided that the Florida State Board of Administration may, among other things, declare its loan immediately due and payable upon any default existing under the SBA Note; however, any payment is subject to approval by the insurance regulatory authority. At June 30, 2023, we no longer held the SBA Note as a result of placing UPC into receivership. Debt Issuance Costs The table below presents the rollforward of our debt issuance costs paid, in conjunction with the debt instruments described above, during the six months ended June 30, 2023 and 2022:
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Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Litigation We are involved in claims-related legal actions arising in the ordinary course of business. We accrue amounts resulting from claims-related legal actions in unpaid losses and LAE during the period that we determine an unfavorable outcome becomes probable and we can estimate the amounts. Management makes revisions to our estimates based on its analysis of subsequent information that we receive regarding various factors, including: (i) per claim information; (ii) company and industry historical loss experience; (iii) judicial decisions and legal developments in the awarding of damages; and (iv) trends in general economic conditions, including the effects of inflation. At June 30, 2023, the Company is involved in legal proceedings whereby on August 18, 2021, Jacqueline A. Miraglia filed suit in the United States District Court for the District of Delaware against United Insurance Holdings Corp. alleging violations arising under Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967, and sought damages in an unspecified amount. On September 27, 2022, venue was transferred to the United States District Court for the Middle District of Florida, Tampa Division and in November, 2022, the plaintiff amended the complaint to add Skyway Claims Services as a defendant. On July 6, 2023, the Company entered into a Settlement Agreement and General Release, which resulted in an immaterial payment to the plaintiff and did not involve an admission of any wrongdoing by any party. Commitments to fund partnership investments We have fully funded one limited partnership investments and have committed to fund our remaining limited partnership investment. The amount of unfunded commitments was $3,602,000 and $4,238,000 at June 30, 2023 and December 31, 2022, respectively. Leases We, as lessee, have entered into leases of commercial office space of various term lengths. In addition to office space, we lease office equipment and a parking lot under operating leases and vehicles under finance leases. The classification of operating and finance lease asset and liability balances within the Unaudited Condensed Consolidated Balance Sheets was as follows:
The components of lease expenses were as follows:
At June 30, 2023, future minimum gross lease payments relating to these non-cancellable operating lease agreements were as follows:
Weighted average remaining lease term and discount rate related to operating and finance leases were as follows:
There were no other cash or non-cash related activities during the three or six months ended June 30, 2023 and 2022. Capital lease amortization expenses are included in depreciation expense in our Unaudited Condensed Consolidated Statements of Comprehensive Loss. See Note 7 of these Notes to Unaudited Condensed Consolidated Financial Statements for more information regarding depreciation expense, Note 11 for information regarding commitments related to long-term debt, and Note 14 for information regarding commitments related to regulatory actions. Subleases We previously leased and occupied office space in which we no longer operate. Effective October 1, 2022, this office space is now subleased to a third-party. This sublease is effective from October 1, 2022 through July 31, 2025, with no option to extend. During the six months ended June 30, 2023, we recognized $99,000 of income related to this sublease, exclusive of the lease expense associated with the original lease. During the year ended December 31, 2022, we recognized $297,000 of income related to this sublease, exclusive of the lease expense associated with the original lease. Additionally, as a result of the sublease, we evaluated our right-of-use asset associated with the original lease for impairment, using the undiscounted cash flows from the sublease. During the year ended December 31, 2022, we recognized impairment of $175,000, which was recognized in the results of our personal lines operating segment. Employee Retention Credit A series of legislation was enacted in the United States during 2020 and 2021 in response to the COVID-19 pandemic that provided financial relief for businesses impacted by government-mandated shutdowns, work stoppages, or other losses suffered by employers. The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provided an employee retention credit, which is a refundable tax credit against certain employment taxes of up to $5,000 per employee for eligible employers. The tax credit is equal to 50% of qualified wages paid to employees during a quarter, capped at $10,000 of qualified wages per employee. During the second quarter of 2022, we evaluated our eligibility and filed for a $10,161,000 refund in connection with our Employee Retention Tax Credit for the tax year ended December 31, 2021. As of June 30, 2023, we have received $5,718,000 from the Internal Revenue Service related to this refund. A gain contingency is an uncertain situation that will be resolved in the future, possibly resulting in a gain. We have not recognized this gain contingency of $10,161,000 within our financial statements except for the $5,718,000 that has already been received. While we believe the likelihood of the refund approval being reversed is low, a loss contingency to the extent of the refunds received and recognized of $5,718,000 is present. We will continue to monitor the matter for further developments that could affect the outcome of these contingencies and will make any appropriate adjustments each quarter.
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Credit Losses |
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Credit Loss [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for Credit Losses | ALLOWANCE FOR EXPECTED CREDIT LOSSES We are exposed to credit losses primarily through four different pools of assets based on similar risk characteristics: premiums receivable for direct written business; reinsurance recoverables from ceded losses to our reinsurers; our investment holdings; and our notes receivable. We estimate the expected credit losses based on historical trends, credit ratings assigned to reinsurers by rating agencies, average default rates, current economic conditions, and reasonable and supportable forecasts of future economic conditions that affect the collectability of the reported amounts over its expected life. Changes in the relevant information may significantly affect the estimates of expected credit losses. The allowance for credit losses is deducted from the amortized cost basis of the assets to present their net carrying value at the amount expected to be collected. Each period, the allowance for credit losses is adjusted through earnings to reflect expected credit losses over the remaining lives of the assets. The following tables summarize our allowance for expected credit losses by pooled asset for the six months ended June 30, 2023 and 2022, respectively:
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Statutory Accounting and Regulation |
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Insurance [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Statutory Accounting and Regulation | STATUTORY ACCOUNTING AND REGULATION The insurance industry is heavily regulated. State laws and regulations, as well as national regulatory agency requirements, govern the operations of all insurers such as our insurance subsidiaries. The various laws and regulations require that insurers maintain minimum amounts of statutory surplus and risk-based capital, restrict insurers' ability to pay dividends, specify allowable investment types and investment mixes, and subject insurers to assessments. Effective June 1, 2022, our insurance subsidiaries JIC and AmCoastal were merged, with AmCoastal being the surviving entity. Effective May 31, 2022, our former insurance subsidiaries UPC and FSIC were merged, with UPC being the surviving entity. Both UPC and AmCoastal are domiciled in Florida, while IIC is domiciled in New York. At June 30, 2023, and during the six months then ended, AmCoastal and IIC met all regulatory requirements of the states in which they operate. As of December 31, 2022, UPC was determined to be insolvent and effective February 27, 2023 was placed into receivership by the DFS. During 2023, we received an assessment notice from the Florida Insurance Guaranty Association (FIGA). This assessment will be 0.7% on direct written premium of all covered lines of business in Florida to cover the cost of an insurance company facing insolvency. This assessment is in addition to the 1.3% assessment, described below, and is recoupable from policyholders. During 2022, we received an assessment notice from FIGA. This assessment will be 1.3% on direct written premium of all covered lines of business in Florida to cover the cost of an insurance company facing insolvency. The National Association of Insurance Commissioners (NAIC) has Risk-Based Capital (RBC) guidelines for insurance companies that are designed to assess capital adequacy and to raise the level of protection that statutory surplus provides for policyholders. Most states, including Florida and New York, have enacted statutory requirements adopting the NAIC RBC guidelines, and insurers having less statutory surplus than required will be subject to varying degrees of regulatory action, depending on the level of capital inadequacy. State insurance regulatory authorities could require an insurer to cease operations in the event the insurer fails to maintain the required statutory capital. The state laws of Florida and New York permit an insurer to pay dividends or make distributions out of that part of statutory surplus derived from net operating profit and net realized capital gains. The state laws further provide calculations to determine the amount of dividends or distributions that can be made without the prior approval of the insurance regulatory authorities in those states and the amount of dividends or distributions that would require prior approval of the insurance regulatory authorities in those states. Statutory RBC requirements may further restrict our insurance subsidiaries' ability to pay dividends or make distributions if the amount of the intended dividend or distribution would cause statutory surplus to fall below minimum RBC requirements. Additionally, in connection with our former subsidiary UPC's plan for run off, IIC has agreed not to pay ordinary dividends without prior approval of the New York Department of Financial Services until January 1, 2025. Our insurance subsidiaries must each file with the various insurance regulatory authorities an “Annual Statement” which reports, among other items, statutory net income (loss) and surplus as regards policyholders, which is called stockholders' equity under GAAP. The table below details the statutory net income (loss) for each of our regulated entities for the three and six months ended June 30, 2023 and 2022.
(1) AmCoastal results are inclusive of JIC as these entities were merged effective June 1, 2022. Our insurance subsidiaries must maintain capital and surplus ratios or balances as determined by the regulatory authority of the states in which they are domiciled. At June 30, 2023, we met these requirements. The table below details the amount of surplus as regards policyholders for each of our regulated entities at June 30, 2023 and December 31, 2022.
(1) AmCoastal results are inclusive of JIC as these entities were merged effective June 1, 2022.
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Accumulated Other Comprehensive Income |
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Accumulated Other Comprehensive Income | ACCUMULATED OTHER COMPREHENSIVE LOSS We report changes in other comprehensive income (loss) items within comprehensive income (loss) on the Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss), and we include accumulated other comprehensive income (loss) as a component of stockholders' equity on our Unaudited Condensed Consolidated Balance Sheets. The table below details the components of accumulated other comprehensive loss at period end:
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Stockholders' Equity |
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Stockholders' Equity | STOCKHOLDERS' EQUITY Our Board of Directors declared dividends on our outstanding shares of common stock to stockholders of record as follows for the periods presented (in thousands, except per share amounts):
In July 2019, our Board of Directors authorized a stock repurchase plan of up to $25,000,000 of our common stock. As of June 30, 2023, we had not yet repurchased any shares under this stock repurchase plan. The timing and volume of repurchases are at the discretion of management, based on the capital needs of the business, the market price of ACIC common stock, and general market conditions. The plan has no expiration date, and the plan may be suspended or discontinued at any time. See Note 17 in these Notes to Unaudited Condensed Consolidated Financial Statements for information regarding stock-based compensation activity.
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Stock-Based Compensation |
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Stock-Based Compensation | ) STOCK-BASED COMPENSATION We account for stock-based compensation under the fair value recognition provisions of ASC Topic 718 - Compensation - Stock Compensation. We recognize stock-based compensation cost over the award’s requisite service period on a straight-line basis for time-based restricted stock grants and performance-based restricted stock grants. We record forfeitures as they occur for all stock-based compensation. The following table presents our total stock-based compensation expense:
(1) The after tax amounts are determined using the 21% corporate federal tax rate. We had approximately $2,676,000 of unrecognized stock compensation expense at June 30, 2023 related to non-vested stock-based compensation granted, which we expect to recognize over a weighted-average period of approximately 2.3 years. We had approximately $218,000 of unrecognized director stock-based compensation expense at June 30, 2023 related to non-vested director stock-based compensation granted, which we expect to recognize over a weighted-average period of approximately 0.9 years. Restricted stock, restricted stock units and performance stock units Stock-based compensation cost for restricted stock awards, restricted stock units and performance stock units is measured based on the closing fair market value of our common stock on the date of grant, which vest in equal installments over the requisite service period of typically three years. Restricted stock awards granted to non-employee directors vest over a one-year period. Each restricted stock unit and performance stock unit represents our obligation to deliver to the holder one share of common stock upon vesting. Performance stock units vest based on the Company's return on average equity compared to a defined group of peer companies. On the grant date, we issue the target number of performance stock units. They are subject to forfeitures if performance goals are not met. The actual number of performance stock units earned can vary from zero to 150 percent of the target for the 2023, 2022, and 2021 awards. We granted 45,000 and 793,041 shares of restricted common stock during the three months ended June 30, 2023 and 2022, respectively, which had a weighted-average grant date fair value of $5.25 and $1.74 per share, respectively. We granted 45,000 and 907,907 shares of restricted common stock during the six months ended June 30, 2023 and 2022, respectively, which had a weighted-average grant date fair value of $5.25 and $1.97 per share, respectively. Additionally, during the three and six month periods ended June 30, 2023, the Company granted 262,933 shares of restricted common stock, with a fair value of $4.33, which are contingent upon stockholder approval of an increase in the number of shares of our common stock that may be issued pursuant to the 2020 Omnibus Incentive Plan. Stockholders will vote on this matter at our 2024 annual meeting of stockholders. The following table presents certain information related to the activity of our non-vested common stock grants:
(1) Contingent shares have been excluded from the calculations in the table above. Stock options Stock option fair value was estimated on the grant date using the Black-Scholes-Merton formula. Stock options vest in equal installments over the requisite service period of typically three years. The following weighted-average assumptions were used to value the stock options granted:
The expected annual dividend yield for our options granted during 2023 and 2022 is based on no dividends being paid in future quarters. The expected volatility is a historical volatility calculated based on the daily closing prices over a period equal to the expected term. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the grant date. Expected term takes into account the three-year graded vesting term and the 10-year contractual term of the option. We did not grant any stock options for the three and six months ended June 30, 2023. We granted 635,643 stock options during the three and six month periods ended June 30, 2022, which had a weighted average grant date fair value of $0.86 per share. Additionally, during the three and six months ended June 30, 2023, the Company granted 123,399 stock options, with a fair value of $3.08, which are contingent upon stockholder approval of an increase in the number of shares of our common stock that may be issued pursuant to the 2020 Omnibus Incentive Plan. Stockholders will vote on this matter at our 2024 annual meeting of stockholders. The following table presents certain information related to the activity of our non-vested stock option grants:
(1) Contingent options have been excluded from the calculations in the table above. (2) The vested shares are calculated based on all vested shares at June 30, 2023, inclusive of those that have since expired. The weighted average exercise prices, weighted-average remaining contractual term and aggregate intrinsic value is calculated based on only vested shares that are outstanding and exercisable at June 30, 2023.
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Subsequent Events |
6 Months Ended |
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Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS We evaluate all subsequent events and transactions for potential recognition or disclosure in our financial statements. At June 30, 2023, the Company was involved in legal proceedings whereby on August 18, 2021, Jacqueline A. Miraglia filed suit in the United States District Court for the District of Delaware against United Insurance Holdings Corp. alleging violations arising under Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967, and sought damages in an unspecified amount. On September 27, 2022, venue was transferred to the United States District Court for the Middle District of Florida, Tampa Division and in November, 2022, the plaintiff amended the complaint to add Skyway Claims Services as a defendant. On July 6, the Company entered into a Settlement Agreement and General Release, which resulted in an immaterial payment to the plaintiff and does not involve an admission of any wrongdoing by any party. On July 10, 2023, we filed with the Secretary of the State of the State of Delaware a Second Certificate of Amendment of Certificate of Incorporation to change its corporate name from United Insurance Holdings Corp. to American Coastal Insurance Corporation, effective July 10, 2023. In connection with the Company's name change, the Board of Directors amended the Company's by-laws to reflect the corporate name American Coastal Insurance Corporation, also effective on July 10, 2023. No other changes were made to the Company's by-laws. On July 27, 2023, we announced that the Company will begin trading on NASDAQ under the ticker symbol "ACIC", prior to market open on August 15, 2023. The new ticker replaces the current ticker symbol "UIHC", which has been used since the Company's formation and initial public offering on the over-the-counter (OTC) market in 2007, and subsequent listing on The Nasdaq Capital Market in 2012. On August 10, 2023, the Company issued a press release related to its earnings for the second quarter ended June 30, 2023 (the Earnings Release). The Earnings Release was filed as exhibit 99.1 to the Form 8-K filed on August 10, 2023. Subsequent to the Earnings Release, the Company has reported changes to its provision for income taxes and Income from discontinued operations, net of tax on its Consolidated Statements of Comprehensive Loss. In addition, the Company has decreased its reported other liabilities and increased its reported other assets on its Consolidated Balance Sheets. On August 21, 2023, the Company filed an amended 10-Q for the first quarter ended March 31, 2023. This amended filing corrects our allocation of discontinued operations to include activities related directly to the support of our former subsidiary UPC. In addition, this amendment corrects our provision for income taxes to appropriately reflect the impact of the disposition of UPC.
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Significant Accounting Policies (Policies) |
6 Months Ended |
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Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Pending Accounting Pronouncements | (b) Changes to Significant Accounting Policies During the three months ended March 31, 2023, our former subsidiary, UPC, was placed into receivership with the DFS. As described in Note 1, effective February 27, 2023, this receivership divested our ownership of UPC. This disposal, as well as the activities related directly to supporting the business conducted by UPC were evaluated for qualification as discontinued operations. The results of operations of business are reported as discontinued operations when the disposal represents a strategic shift that will have a major effect on the entity's operations and financial results. When a business is identified for discontinued operations reporting: •Results for prior periods are retroactively reclassified as discontinued operations; •Results of operations are reported in a single line, net of tax, in the Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss); and •Assets and liabilities are reported as held for disposal in the Unaudited Condensed Consolidated Balance Sheets Additional details by major classification of operating results and financial position are included in Note 3. There have been no other changes to our significant accounting policies as reported in our Annual Report on Form 10-K for the year ended December 31, 2022. (c) Pending Accounting Pronouncements We have evaluated pending accounting pronouncements and do not believe any would have an impact on the operations or financial reporting of our company.
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Discontinued Operations and Disposal Groups (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disposal Groups, Assets & Liabilities | The results from discontinued operations for the three and six months ended June 30, 2023 and 2022 are presented below.
As of February 28, 2023, the Company completed the disposal of its former subsidiary, UPC. This divestiture resulted in a gain of $238,440,000 for the three months ended March 31, 2023. This gain was driven by the negative equity position of UPC. The major classes of assets and liabilities transferred as a result of the transaction as of the date of transfer and December 31, 2022 are presented below.
(1) The Company divested its ownership on February 27, 2023, the date the DFS was appointed as receiver of the entity. In addition, the major classes of assets and liabilities remaining related to activities directly supporting the business conducted by UPC are outlined in the table below as of June 30, 2023 and December 31, 2022.
The discontinued operations of the Company incurred $488,000 and $748,000 of amortization expense during the six months ended June 30, 2023 and 2022, respectively. There were no other noncash transactions for either period.
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Segment Reporting (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The tables below present the information for each of the reportable segment's profit or loss, as well as segment assets for the three and six months ended June 30, 2023 and 2022. We have restated our segments to reflect the discontinued operations disclosed in Note 3, excluding the result of the entity for all periods presented.
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations. (2) Included in our General and Administrative expenses is $996,000 and $811,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. (3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below. (4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses. (5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses. (6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations. (2) Included in our General and Administrative expenses is $1,047,000 and $877,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. (3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below. (4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses. (5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses. (6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations. (2) Included in our General and Administrative expenses is $2,003,000 and $1,623,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. (3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below. (4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses. (5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses. (6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations. (2) Included in our General and Administrative expenses is $2,121,000 and $1,762,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. (3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below. (4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses. (5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses. (6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
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Investments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Debt and Equity Securities, FV-NI | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Available-for-sale Securities Reconciliation | The following table details fixed-maturity available-for-sale securities, by major investment category, at June 30, 2023 and December 31, 2022:
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Equity Securities Fair Value | Equity securities are summarized as follows:
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Schedule of Realized Gain (Loss) | The following table details our realized gains (losses) by major investment category for the three and six months ended June 30, 2023 and 2022, respectively:
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Investments Classified by Contractual Maturity Date | The table below summarizes our fixed maturities at June 30, 2023 by contractual maturity periods. Actual results may differ as issuers may have the right to call or prepay obligations, with or without penalties, prior to the contractual maturities of those obligations.
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Investment Income | The following table summarizes our net investment income by major investment category:
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Schedule of Unrealized Loss on Investments | The following table presents an aging of our unrealized investment losses by investment class:
(1) This amount represents the actual number of discrete securities, not the number of shares or units of those securities. The numbers are not presented in thousands.
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Schedule of Fair Value of Financial Instruments Measured on a Recurring Basis | The following table presents the fair value of our financial instruments measured on a recurring basis by level at June 30, 2023 and December 31, 2022:
(1) Other investments included in the fair value hierarchy exclude these limited partnership interests that are measured at estimated fair value using the net asset value per share (or its equivalent) practical expedient.
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Schedule of Investments in Limited Partnerships | The information presented in the table below is as of June 30, 2023:
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Restrictions on Cash and Cash Equivalents | The following table presents the components of restricted assets:
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Securities Owned and Other Investments Not Readily Marketable Disclosure | The table below shows the carrying value of those securities held on deposit with regulators.
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Earnings per Share (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share | The following table shows the computation of basic and diluted EPS for the three and six month periods ended June 30, 2023 and 2022, respectively:
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Property and Equipment, Net (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property and Equipment | Property and equipment, net consists of the following:
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Goodwill and Intangible Assets (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Intangible Assets and Goodwill | The following is a summary of intangible assets excluding goodwill recorded as intangible assets on our Unaudited Condensed Consolidated Balance Sheets:
(1) Indefinite-lived intangible assets are comprised of state insurance and agent licenses, as well as perpetual software licenses.
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Schedule of Acquired Finite-Lived Intangible Assets by Major Class | Intangible assets subject to amortization consisted of the following:
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Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Estimated amortization expense of our intangible assets to be recognized by the Company during the remainder of 2023 and over the next five years is as follows:
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Reinsurance (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance Recoverables | Reinsurance recoverable at the balance sheet dates consists of the following:
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Liability for Unpaid Losses and Loss Adjustment Expense (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Insurance [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Liability for Unpaid Claims and Claims Adjustment Expense | The table below shows the analysis of our reserve for unpaid losses for the six months ended June 30, 2023 and 2022 on a GAAP basis:
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Long-Term Debt (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Long-term Debt Instruments | The table below presents all long-term debt outstanding as of June 30, 2023 and December 31, 2022:
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Debt Issuance Cost Rollforward | The table below presents the rollforward of our debt issuance costs paid, in conjunction with the debt instruments described above, during the six months ended June 30, 2023 and 2022:
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Commitments and Contingencies Leases (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease, Cost | The components of lease expenses were as follows:
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Lease Assets and Liabilities | The classification of operating and finance lease asset and liability balances within the Unaudited Condensed Consolidated Balance Sheets was as follows:
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Weighted Average Lease Terms | Weighted average remaining lease term and discount rate related to operating and finance leases were as follows:
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Lessee, Operating Lease, Liability, Maturity | At June 30, 2023, future minimum gross lease payments relating to these non-cancellable operating lease agreements were as follows:
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Credit Losses (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Credit Loss [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Credit Loss Allowance Activity [Table] | The following tables summarize our allowance for expected credit losses by pooled asset for the six months ended June 30, 2023 and 2022, respectively:
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Accumulated Other Comprehensive Income (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The table below details the components of accumulated other comprehensive loss at period end:
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Stockholders' Equity (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Dividends Declared | Our Board of Directors declared dividends on our outstanding shares of common stock to stockholders of record as follows for the periods presented (in thousands, except per share amounts):
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Stock-Based Compensation (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Share-based Compensation, Stock Options and Stock Appreciation Rights Award Activity | The following table presents certain information related to the activity of our non-vested stock option grants:
(1) Contingent options have been excluded from the calculations in the table above. (2) The vested shares are calculated based on all vested shares at June 30, 2023, inclusive of those that have since expired. The weighted average exercise prices, weighted-average remaining contractual term and aggregate intrinsic value is calculated based on only vested shares that are outstanding and exercisable at June 30, 2023.
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Schedule of Nonvested Share Activity | The following table presents certain information related to the activity of our non-vested common stock grants:
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Share-based Payment Arrangement, Activity | The following table presents our total stock-based compensation expense:
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Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The following weighted-average assumptions were used to value the stock options granted:
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Organization, Consolidation and Presentation (Details) |
6 Months Ended |
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Jun. 30, 2023
subsidiary
| |
Number of Wholly-Owned Subsidiaries | |
Number of Wholly Owned Subsidiaries | 2 |
Investments (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Schedule of Available-for-sale Securities | ||||
Credit Loss Change, Available-for-Sale Investments | $ 0 | $ 0 | $ 0 | $ 0 |
Investments - Investment Income (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
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Net Investment Income | ||||
Investment income | $ 2,764 | $ 1,957 | $ 5,427 | $ 3,531 |
Investment expenses | (72) | (118) | (146) | (288) |
Net investment income | 2,692 | 1,839 | 5,281 | 3,243 |
Fixed Maturities | ||||
Net Investment Income | ||||
Investment income | 1,224 | 1,583 | 2,496 | 3,014 |
Equity Securities | ||||
Net Investment Income | ||||
Investment income | 0 | 62 | 81 | 128 |
Cash and cash equivalents | ||||
Net Investment Income | ||||
Investment income | 1,624 | 195 | 2,928 | 217 |
Other Investments | ||||
Net Investment Income | ||||
Investment income | $ (84) | $ 117 | $ (78) | $ 172 |
Investments - Equity Securities, FV-NI (Details) - Mutual Fund - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Debt and Equity Securities, FV-NI | ||
Fair value | $ 0 | $ 15,657 |
Percent of Total | 0.00% | 100.00% |
Investments - Restricted Cash (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Restricted Cash and Cash Equivalents Items | ||
Assets Held-in-trust | $ 48,874 | $ 45,364 |
Restricted Cash | 49,501 | 45,988 |
Regulatory Assets, Fair Value Disclosure | 627 | 624 |
Security Deposit | $ 2,493 | $ 2,616 |
Earnings per Share - Schedule of Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
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Numerator | ||||
Net income attributable to UIHC common stockholders | $ 17,779 | $ (69,029) | $ 285,059 | $ (102,201) |
Denominator | ||||
Weighted-average shares outstanding | 43,229,416 | 43,049,227 | 43,178,758 | 43,015,114 |
Effect of dilutive securities | 575,801 | 0 | 511,677 | 0 |
Weighted-average diluted shares | 43,805,217 | 43,049,227 | 43,690,435 | 43,015,114 |
Basic earnings per share | $ 0.42 | $ (1.60) | $ 6.59 | $ (2.37) |
Diluted earnings per share | $ 0.41 | $ (1.60) | $ 6.52 | $ (2.37) |
Property and Equipment, Net (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2023 |
Mar. 31, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Property, Plant and Equipment [Abstract] | ||||||
Depreciation and amortization expense | $ 996 | $ 1,230 | $ 2,004 | $ 2,502 | ||
Software in progress | $ 76 | 76 | $ 82 | |||
Property, Plant and Equipment, Disposals | $ 13,202 | 691 | ||||
Accumulated Depreciation, Depletion and Amortization, Sale or Disposal of Property, Plant and Equipment | 12,691 | 644 | ||||
Leased Vehicle Disposal | 1,222 | 1,069 | ||||
Accumulated Depreciation - Leased Vehicles Disposed of | 1,114 | $ 1,038 | ||||
Gain on Leased Vehicle Disposal | 738 | $ 559 | ||||
Building Disposal | 13,369 | |||||
Accumulated Depreciation, Buildings Disposed of | 5,129 | |||||
Gain on Building Disposal | $ 12,164 |
Property and Equipment, Net - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Property, Plant and Equipment | ||
Total, at cost | $ 9,251 | $ 11,411 |
Less: Accumulated Depreciation and Amortization, Property, Plant, and Equipment | (4,777) | (6,118) |
Property, Plant and Equipment, Net | 4,474 | 5,293 |
Office Equipment | ||
Property, Plant and Equipment | ||
Total, at cost | 806 | 1,414 |
Computer Equipment | ||
Property, Plant and Equipment | ||
Total, at cost | 8,134 | 8,164 |
Leasehold Improvements | ||
Property, Plant and Equipment | ||
Total, at cost | 311 | 753 |
Vehicles | ||
Property, Plant and Equipment | ||
Total, at cost | $ 0 | $ 1,080 |
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2023 |
Mar. 31, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||
Amortization of Intangible Assets | $ 811 | $ 812 | $ 1,623 | $ 1,624 | ||
Goodwill | 59,476 | 59,476 | $ 59,476 | |||
Goodwill, Impairment Loss | 10,156 | |||||
Goodwill, Impaired, Accumulated Impairment Loss | $ 10,156 | $ 10,156 | ||||
Goodwill - Commercial Lines | $ 59,476 | |||||
Gain (Loss) on Disposition of Intangible Assets | $ 2,359 |
Goodwill and Intangible Assets - Future Amortization Expense (Details) $ in Thousands |
Jun. 30, 2023
USD ($)
|
---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | |
Finite-Lived Intangible Asset, Expected Amortization, Remainder of Fiscal Year | $ 1,623 |
Finite-Lived Intangible Asset, Expected Amortization, Year One | 2,640 |
Finite-Lived Intangible Asset, Expected Amortization, Year Three | 2,438 |
Finite-Lived Intangible Asset, Expected Amortization, Year Four | 2,438 |
Finite-Lived Intangible Asset, Expected Amortization, Year Four | 609 |
Finite-Lived Intangible Asset, Expected Amortization, Year Five | $ 0 |
Goodwill and Intangible Assets - Reconciliation (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Indefinite-lived Intangible Assets (Excluding Goodwill) | $ 1,198 | $ 1,398 |
Finite-Lived Intangible Assets, Net | 9,748 | 11,372 |
Intangible Assets, Net (Excluding Goodwill) | $ 10,946 | $ 12,770 |
Reinsurance (Details) $ in Thousands |
3 Months Ended | 6 Months Ended |
---|---|---|
Jun. 30, 2023
USD ($)
|
Jun. 30, 2023
USD ($)
|
|
Reinsurance Retention Policy | ||
Document Period End Date | Jun. 30, 2023 | |
Event Retention Level | $ 10,000 | $ 10,000 |
Catastrophe Excess of Loss | ||
Reinsurance Retention Policy | ||
Reinsurance, Excess Retention, Amount Reinsured, Per Policy | 1,300,000 | |
All Other Perils Excess of Loss | ||
Reinsurance Retention Policy | ||
Reinsurance, Excess Retention, Amount Reinsured, Per Policy | 101,000 | |
Interboro Insurance | ||
Reinsurance Retention Policy | ||
Event Retention Level | 3,000 | $ 3,000 |
Interboro Insurance | Catastrophe Excess of Loss | ||
Reinsurance Retention Policy | ||
Reinsurance, Excess Retention, Amount Reinsured, Per Policy | $ 82,000 |
Reinsurance Recoverables (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|---|---|
Reinsurance Recoverable | ||||
Reinsurance Recoverable for Unpaid Claims and Claims Adjustments | $ 443,719 | $ 732,254 | $ 163,509 | $ 176,096 |
Reinsurance Recoverable for Paid Claims and Claims Adjustments | 215,095 | 64,292 | ||
Reinsurance Recoverable for Paid and Unpaid Claims and Claims Adjustments | $ 658,814 | $ 796,546 |
Long-Term Debt (Details) - USD ($) $ in Thousands |
Dec. 13, 2017 |
May 26, 2016 |
Sep. 22, 2006 |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|---|---|---|
Debt Instrument | |||||
Notes Payable | $ 148,521 | $ 148,355 | |||
BB&T Term Note Payable | |||||
Debt Instrument | |||||
Notes Payable | $ 5,200 | ||||
Interest rate (percentage) | 1.65% | ||||
Debt Instrument, Term | 15 years | ||||
Florida State Board of Administration | |||||
Debt Instrument | |||||
Notes Payable | $ 20,000 | ||||
Debt Instrument, Term | 20 years | ||||
150M Senior Notes | |||||
Debt Instrument | |||||
Notes Payable | $ 150,000 | ||||
Interest rate (percentage) | 6.25% | ||||
Debt Instrument, Term | 10 years |
Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands |
6 Months Ended | |||
---|---|---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
Dec. 13, 2017 |
May 26, 2016 |
|
Debt Instrument | ||||
Long-term Debt, Fair Value | $ 150,000 | $ 150,000 | ||
150M Senior Notes | ||||
Debt Instrument | ||||
Debt Instrument, Maturity Date | Dec. 15, 2027 | |||
Interest rate (percentage) | 6.25% | |||
Debt Instrument, Interest Rate, Effective Percentage | 7.25% | |||
Long-term Debt, Fair Value | $ 150,000 | 150,000 | ||
BB&T Term Note Payable | ||||
Debt Instrument | ||||
Debt Instrument, Maturity Date | May 26, 2031 | |||
Interest rate (percentage) | 1.65% | |||
Long-term Debt, Fair Value | $ 0 | 0 | ||
Florida State Board of Administration | ||||
Debt Instrument | ||||
Debt Instrument, Maturity Date | Jul. 01, 2026 | |||
Long-term Debt, Fair Value | $ 0 | $ 0 |
Debt Issuance Cost Rollforward (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|---|---|
Debt Disclosure [Abstract] | ||||
Debt Issuance Costs, Gross | $ 0 | $ 0 | ||
Accumulated Amortization, Debt Issuance Costs | (166) | (168) | ||
Debt Issuance Costs, Net | $ 1,479 | $ 1,645 | $ 1,830 | $ 1,998 |
Commitments and Contingencies Lease Costs (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Mar. 31, 2024 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Lease Costs | |||||
Operating Lease, Expense | $ 222 | $ 160 | $ 444 | $ 320 | |
Finance Lease, Right-of-Use Asset, Amortization | 2 | 113 | 9 | 242 | |
Finance Lease, Interest Expense | 0 | 1 | 0 | 1 | |
Lease, Cost | $ 224 | $ 274 | 453 | $ 563 | |
Operating Leases, Income Statement, Sublease Revenue | $ 297 | $ 99 |
Commitments and Contingencies Lease Assets and Liabilities (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Lessee, Lease, Description | ||
Operating Lease, Right-of-Use Asset | $ 903 | $ 1,278 |
Finance Lease, Right-of-Use Asset, after Accumulated Amortization | 0 | 51 |
Total Lease Assets | 903 | 1,329 |
Operating Lease, Liability | 1,172 | 1,689 |
Finance Lease, Liability | 0 | 2 |
Total Lease Liability | $ 1,172 | $ 1,691 |
Commitments and Contingencies Weighted Average Lease Terms (Details) |
Jun. 30, 2023
Rate
|
Dec. 31, 2022
Rate
|
---|---|---|
Weighted Average Terms | ||
Operating Lease, Weighted Average Discount Rate, Percent | 3.57% | 3.79% |
Operating Lease, Weighted Average Remaining Lease Term | 1 year 8 months | 2 years 1 month |
Finance Lease, Weighted Average Discount Rate, Percent | 0.00% | 3.27% |
Finance Lease, Weighted Average Remaining Lease Term | 0 years | 9 months |
Commitments and Contingencies Schedule of Future Minimum Rental Payments (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Schedule of Future Minimum Rental Payments | ||
Total Lease Future Payments Year 1 | $ 432 | |
Total Lease Future Payments Year 2 | 593 | |
Total Lease Future Payments Year 3 | 222 | |
Total Lease Future Payments Year 4 | 11 | |
Total Lease Future Payments | 1,258 | |
Total Lease Liability Undiscounted Excess Amount | (86) | |
Operating Lease, Liability | 1,172 | $ 1,689 |
Finance Lease, Liability | 0 | 2 |
Total Lease Liability | $ 1,172 | $ 1,691 |
Commitments and Contingencies Narrative (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Commitments and Contingencies Disclosure [Abstract] | ||
Partnership unfunded commitments | $ 3,602 | $ 4,238 |
Credit Losses (Details) - USD ($) $ in Thousands |
6 Months Ended | |||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Credit Loss Allowance Activity | ||||
Premium Receivable, Allowance for Credit Loss | $ 28 | $ 17 | $ 32 | $ 16 |
Reinsurance Recoverable, Allowance for Credit Loss | 169 | 81 | 333 | 58 |
Financing Receivable, Allowance for Credit Loss | 0 | 0 | ||
Total Credit Loss Allowances | 197 | 98 | $ 365 | $ 74 |
Premium Receivable, Credit Loss Expense (Reversal) | (47) | (21) | ||
Reinsurance Recoverable, Credit Loss Expense (Reversal) | (164) | 23 | ||
Total Credit Loss Allowance Expenses | (211) | 2 | ||
Premium Receivable, Allowance for Credit Loss, Writeoff | 43 | 22 | ||
Reinsurance recoverable, allowance for credit loss, writeoff | 0 | 0 | ||
Total Credit Loss Allowance Writeoffs | $ 43 | $ 22 |
Schedule of Dividends Declared (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended |
---|---|---|
Mar. 31, 2022 |
Jun. 30, 2022 |
|
Class of Stock | ||
Dividends declared per share (in usd per share) | $ 0 | |
Aggregate amount of dividends | $ 2,589 | |
Common Stock, Dividends, Per Share, Cash Paid | $ 0 |
Stockholders' Equity Narrative (Details) $ in Thousands |
Jun. 30, 2023
USD ($)
|
---|---|
Stockholders' Equity Narrative [Abstract] | |
Stock Repurchase Program, Authorized Amount | $ 25,000 |
Stock-Based Compensation - Stock-based Compensation Expense (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023
USD ($)
year
|
Jun. 30, 2022
USD ($)
|
Jun. 30, 2023
USD ($)
year
|
Jun. 30, 2022
USD ($)
|
|
Employee | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Unrecognized Stock Compensation Expense | $ 2,676 | $ 2,676 | ||
Weighted average remaining expense period | year | 2.3 | 2.3 | ||
Pre-Tax Expense | $ 79 | $ 141 | $ 388 | $ 531 |
Post-Tax Expense | 62 | 111 | 307 | 419 |
Director | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Unrecognized Stock Compensation Expense | $ 218 | $ 218 | ||
Weighted average remaining expense period | year | 0.9 | 0.9 | ||
Pre-Tax Expense | $ 29 | 41 | $ 55 | 103 |
Post-Tax Expense | $ 23 | $ 32 | $ 43 | $ 81 |
Stock-Based Compensation - Non-Vested Common Stock Grants (Details) - Restricted Stock - $ / shares |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Granted shares | 45,000 | 793,041 | 45,000 | 907,907 | |
Less: Forfeited shares | 130,546 | ||||
Less: Vested shares | 179,334 | ||||
Outstanding shares | 449,359 | 449,359 | 714,239 | ||
Granted (fair value) | $ 5.25 | $ 1.74 | $ 5.25 | $ 1.97 | |
Less: Forfeited (fair value) | 3.16 | ||||
Less: Vested (fair value) | 3.20 | ||||
Outstanding (fair value) | $ 2.67 | $ 2.67 | $ 2.73 |
Stock-Based Compensation - Weighted-Average Assumptions - Stock Options (Details) |
3 Months Ended | 6 Months Ended | |
---|---|---|---|
Mar. 31, 2023 |
Jun. 30, 2023
Rate
|
Jun. 30, 2022
Rate
|
|
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 6 years | ||
Expected volatility | 80.84% | 49.66% | |
Risk-free interest rate | 3.44% | 2.92% |
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