Accounting Changes and Error Corrections

6 Months Ended

Jun. 30, 2023

Accounting Changes and Error Corrections [Abstract]

Immaterial Correction to Prior Period Financial Statements for Accounting Policy Change

Immaterial Correction to Prior Period Financial Statements for Accounting Policy Change

The Company charges insureds certain policy fees and recognizes such fees into earnings when the related premium is written. Previously, the Company presented these fees as a reduction of underwriting, acquisition and insurance expenses. Effective April 1, 2023, the Company corrected its accounting policy to present these fees as fee income in the consolidated statements of income and comprehensive income in accordance with ASC 944, Financial Services–Insurance.

The Company presented $7.0 million and $13.2 million as fee income for the three and six months ended June 30, 2023, respectively, in the consolidated statements of income and comprehensive income. The Company reclassified $4.9 million and $9.3 million to fee income from underwriting, acquisition and insurance expenses in the previously issued financial statements on Form 10-Q for the three and six months ended June 30, 2022, respectively, to correct prior periods’ presentation. The Company considered the qualitative and quantitative impacts and determined that the correction was not material to the Company's previously issued consolidated financial statements.