Investments

12 Months Ended

Dec. 31, 2023

Investments, Debt and Equity Securities [Abstract]

Unrealized gains and losses

The following tables present cost or amortized cost and fair values of investments in fixed maturities at December 31, 2023 and 2022, respectively ($ in millions):


	Cost or Amortized Cost		Gross Unrealized				Fair Value
			Gains		Losses
December 31, 2023
Corporate debt securities	$	453.6	$	1.3	$	(5.0)	$	449.9
U.S. Government obligations	176.8		0.4		(1.3)		175.9
Asset-backed securities	1.6		—		—		1.6

Total	$	632.0	$	1.7	$	(6.3)	$	627.4

December 31, 2022
Corporate debt securities	$	549.7	$	0.1	$	(19.6)	$	530.2
U.S. Government obligations	121.0		—		(3.7)		117.3
Asset-backed securities	2.8		—		—		2.8

Total	$	673.5	$	0.1	$	(23.3)	$	650.3

Gross unrealized losses for investments in fixed maturities was $6.3 million and $23.3 million as of December 31, 2023 and 2022. Gross unrealized gains and losses were recorded as a component of accumulated other comprehensive income.

Contractual maturities of bonds

The following table presents the cost or amortized cost and estimated fair value of investments in fixed maturities as of December 31, 2023 by contractual maturity ($ in millions). Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.


	December 31, 2023
	Cost or Amortized Cost		Fair Value
Due in one year or less	$	258.7	$	255.5
Due after one year through five years	373.3		371.9
Due after five years through ten years	—		—
Due after ten years	—		—
Total	$	632.0	$	627.4

Aging of gross unrealized losses

The following tables present the gross unrealized losses and related fair values for the Company's investment in fixed maturities, grouped by duration of time in a continuous unrealized loss position as of December 31, 2023 and 2022 ($ in millions):


	Less than 12 Months				12 Months or More				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
December 31, 2023
Corporate debt securities	$	89.0	$	(1.2)	$	178.3	$	(4.0)	$	267.3	$	(5.2)
U.S. Government obligations	79.6		(0.2)		57.7		(0.9)		137.3		(1.1)
Asset-backed securities	—		—		0.2		—		0.2		—

Total	$	168.6	$	(1.4)	$	236.2	$	(4.9)	$	404.8	$	(6.3)

December 31, 2022
Corporate debt securities	$	83.6	$	(2.1)	$	428.1	$	(17.5)	$	511.7	$	(19.6)
U.S. Government obligations	29.6		(0.2)		85.1		(3.5)		114.7		(3.7)
Asset-backed securities	2.8		—		—		—		2.8		—

Total	$	116.0	$	(2.3)	$	513.2	$	(21.0)	$	629.2	$	(23.3)

As of December 31, 2023, 175 of the securities held were in an unrealized loss position. Investments in fixed maturities with gross unrealized losses for twelve months or more was $4.9 million and $21.0 million for the years ended December 31, 2023 and 2022, respectively. The Company determined that unrealized losses on investment in fixed maturities were primarily due to the interest rate environment, and not credit risk related to the issuers of these securities. The Company does not intend to sell these investments in fixed maturities, and it is not more likely than not that that the Company will be required to sell these investments in fixed maturities before the recovery of the amortized cost basis. No allowance for credit losses related to any of these securities was recorded for the years ended December 31, 2023 and 2022.

Net investment income

An analysis of net investment income follows ($ in millions):


	December 31,
	2023		2022		2021
Interest on cash and cash equivalents	$	4.2	$	1.2	$	0.4
Fixed maturities	17.0		5.7		1.5
Short-term investments	3.8		1.9		0.1
Total	25.0		8.8		2.0
Investment expense	0.3		0.4		0.1
Net investment income	$	24.7	$	8.4	$	1.9

Investment gains and losses

The Company had pre-tax realized capital losses of $0.6 million and $0.4 million for the years ended December 31, 2023 and 2022, respectively. There were no pre-tax realized capital gains and losses for the year ended December 31, 2021.

Special deposits

Bonds with a total carrying value of $11.7 million and $11.8 million at December 31, 2023 and 2022, respectively, which are included in fixed maturities available-for-sale on the consolidated balance sheets, were deposited with various state insurance departments, as required, to comply with state insurance laws. The carrying value of bonds deposited with each respective state is as follows ($ in millions):


	December 31,
U.S. State	2023		2022
New York	$	2.9	$	2.8
Delaware	2.8		2.8
Washington	1.2		1.2
Colorado	1.1		1.1
Virginia	0.8		0.8
New Mexico	0.7		0.6
New Jersey	0.6		0.6
North Carolina	0.6		0.6
Nevada	0.2		0.4
Florida	0.2		0.2
Massachusetts	0.2		0.2
Kansas	0.2		0.1
Arkansas	0.1		0.3
Kentucky	0.1		0.1
Total	$	11.7	$	11.8

Restricted investments

Restricted investments are held in a trust account securing the Company’s insurance subsidiary's contractual obligations under the Property Catastrophe Excess of Loss reinsurance contract with a captive (see Note 8) which will not be released until the underlying risks have expired or have been settled. Restricted investments include certain investments in debt securities and short-term investments of $82.2 million as of December 31, 2023.