Loss and Loss Adjustment Expense Reserves (Tables)

12 Months Ended

Dec. 31, 2021

Schedule of beginning and ending reserve balances for losses and LAE, net of reinsurance recoverable

The following table provides a reconciliation of the beginning and ending reserve balances for losses and LAE, net of reinsurance recoverable, as of December 31, 2021, and 2020 (in thousands):


	For the years ended December 31,
	2021		2020
Balance at January 1	$	57,093	$	52,222
Less reinsurance recoverable	(33,941)		(28,837)
Net balance at January 1	23,152		23,385

Incurred related to:
Current year	88,640		16,140
Prior years	(350)		4,793
Total incurred	88,290		20,933

Paid related to:
Current year	45,640		6,425
Prior years	(7,636)		14,741
Total paid	38,004		21,166

Net balance at end of period	73,438		23,152
Plus reinsurance recoverable	—		33,941
Balance at end of period	$	73,438	$	57,093

The following table reconciles the incurred and paid claims development to the liability for losses and loss adjustment expenses for the year ended December 31, 2021 (in thousands):


Total incurred losses and loss adjustment expenses, net of reinsurance	$	216,785
Total paid losses and loss adjustment expenses, net of reinsurance	(143,347)
Liabilities for loss and LAE, net of reinsurance	73,438
Reinsurance recoverable on losses and LAE	—
Loss and loss adjustment expense reserves, gross of reinsurance	$	73,438

Average annual percentage payout of incurred claims by age, net of reinsurance

The following is supplementary information about average historical claims duration as of December 31, 2021. Given the stage of the Insurance Company, historical data for claims is limited to five years.

Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance


Years	1		2		3		4		5		6	7	8	9	10
Automobile	51	%	24	%	11	%	6	%	2	%

Short-duration insurance contracts

The following is information about incurred and paid claims development as of December 31, 2021, net of reinsurance, as well as cumulative claim frequency and the total of incurred-but-not-reported (“IBNR”) liabilities plus expected development on reported claims included within the net incurred claims amounts.

The information about incurred and paid claims development for the years ended December 31, 2017 to December 31, 2021, including claim frequency, is presented below (dollars in thousands). The Company tracks claim frequency by individual claimant.


	Automobile										As of December 31, 2021
	Incurred loss and loss adjustment expenses, net of reinsurance For the Years Ended December 31,										IBNR Reserves		Cumulative Number of Reported Claims
Accident Year	2017*		2018*		2019*		2020*		2021




2017	$	34,309	$	36,244	$	36,326	$	37,529	$	38,619	$	1,090	29,064
2018			37,879		36,501		38,657		38,585		$	2,529	44,097
2019			—		31,705		32,954		31,097		$	3,804	51,101
2020			—		—		16,140		16,546		$	6,585	37,239
2021									88,640		$	23,136	41,483
							Total		$	213,487


			Automobile
			Cumulative paid loss and loss adjustment expenses, net of reinsurance For the Years Ended December 31,
Accident Year			2017*		2018*		2019*		2020*		2021





2017			$	21,246	$	29,988	$	33,987	$	36,121	$	36,898
2018					20,771		30,154		34,465		34,142
2019							17,032		25,235		21,630
2020									6,426		1,773
2021											45,640
Total	$	140,083
All outstanding liabilities before 2017, net of reinsurance	$	34
Liabilities for loss and LAE, net of reinsurance	$	73,438

*Unaudited required supplemental information.