Unpaid Losses and Loss Adjustment Expenses

3 Months Ended

Mar. 31, 2025

Unpaid Losses and Loss Adjustment Expenses [Abstract]

Unpaid Losses and Loss Adjustment Expenses

7.  Unpaid Losses and Loss Adjustment Expenses

Activity in the liability for unpaid losses and loss adjustment expenses is summarized as follows for both continuing and discontinued operations:

	Three Months Ended March 31,
	2025		2024
Balance, beginning of period:
Liability for unpaid losses and loss adjustment expenses	$	137,288	$	217,119
Reinsurance recoverables on losses		12,561		48,969
Net balance, beginning of period		124,727		168,150
Incurred related to:
Current year		37,107		50,925
Prior years		1,418		1,284
Total incurred		38,525		52,209
Paid related to:
Current year		10,375		12,940
Prior years		25,637		31,897
Total paid		36,012		44,837
Balance, end of period:
Liability for unpaid losses and loss adjustment expenses		135,886		225,006
Reinsurance recoverables on losses		8,646		49,484
Net balance, end of period	$	127,240	$	175,522

During the three months ended March 31, 2025, the Company’s incurred reported losses and loss adjustment expense included $1,418 of net unfavorable development on prior accident years. This was primarily attributable to unfavorable development for the Direct Auto non-standard auto business. During the three months ended March 31, 2024, the Company’s incurred reported losses and loss adjustment expenses included $1,284 of net unfavorable development on prior accident years, primarily attributable to unfavorable development for the Direct Auto non-standard auto business partially offset by favorable development for Battle Creek, American West, and Nodak Insurance. During 2024, Westminster was sold and all associated liabilities were included in the sale.

Changes in unpaid losses and loss adjustment expense reserves are generally the result of ongoing analysis of recent loss development trends. As additional information becomes known regarding individual claims, original estimates are increased or decreased accordingly.

The tables for the current and comparable prior year quarter continuing and discontinued operations showing the liability for unpaid losses and loss adjustment expense are shown below:

	Three Months Ended March 31,
	2025		2024
Continuing operations:
Balance, beginning of period:
Liability for unpaid losses and loss adjustment expenses	$	137,288	$	119,184
Reinsurance recoverables on losses		12,561		6,460
Net balance, beginning of period		124,727		112,724
Incurred related to:
Current year		37,107		38,888
Prior years		1,418		1,256
Total incurred		38,525		40,144
Paid related to:
Current year		10,375		11,702
Prior years		25,637		26,981
Total paid		36,012		38,683
Balance, end of period:
Liability for unpaid losses and loss adjustment expenses		135,886		120,531
Reinsurance recoverables on losses		8,646		6,346
Net balance, end of period	$	127,240	$	114,185

	Three Months Ended March 31,
	2025		2024
Discontinued operations:
Balance, beginning of period:
Liability for unpaid losses and loss adjustment expenses	$	—	$	97,935
Reinsurance recoverables on losses		—		42,509
Net balance, beginning of period		—		55,426
Incurred related to:
Current year		—		12,037
Prior years		—		28
Total incurred		—		12,065
Paid related to:
Current year		—		1,238
Prior years		—		4,916
Total paid		—		6,154
Balance, end of period:
Liability for unpaid losses and loss adjustment expenses		—		104,475
Reinsurance recoverables on losses		—		43,138
Net balance, end of period	$	—	$	61,337