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Variable Interest Entity Disclosure [Text Block]
6 Months Ended
Jun. 30, 2019
Notes  
Variable Interest Entity Disclosure

Note 6.Other Investments, Including Variable Interest Entities 

 

Included in other investments is our investment in Ebix Health Exchange which administers various lines of health insurance for IHC’s insurance subsidiaries. The carrying value of the Company’s equity investment in Ebix Health Exchange is $4,762,000 and $6,425,000 at June 30, 2019 and December 31, 2018, respectively, and the Company recorded $(1,121,000) and $(1,663,000), respectively, of equity income (loss) from its investment for the three and six months ended June 30, 2019 and $(255,000) and $(771,000), respectively, of equity income (loss) from its investment for the same periods of 2018.

 

At June 30, 2019 and December 31, 2018, the Company’s Condensed Consolidated Balance Sheets include $1,817,000 and $1,842,000, respectively, of notes and other amounts receivable from Ebix Health Exchange, and include $253,000 and $910,000, respectively, of administrative fees and other expenses payable to Ebix Health Exchange, which are included in other assets and accounts payable, accruals and other liabilities, respectively. The Company’s Condensed Consolidated Statements of Income include administrative fee expenses to Ebix Health Exchange, which are included in selling, general and administrative expenses of $525,000 and $987,000, for the three and six months ended June 30, 2019, respectively, and $1,926,000 and $4,473,000, respectively, for the same periods of 2018.

 

In June 2019, the Company paid $3,000,000 for an equity interest in a lead generation company that will be accounted for as an equity method investment.

 

In March 2019, the Company’s equity investment in Pets Best, that was carried at a cost of $500,000, was acquired by an unaffiliated entity and the Company realized a gain of $3,589,000 on the sale, which is included in Other Income in the Condensed Consolidated Statement of Income for the six months ended June 30, 2019.

 

Variable Interest Entities

 

The Company has a minority interest in certain limited partnerships that we have determined to be Variable Interest Entities (“VIEs”).  The aforementioned VIEs are not required to be consolidated in the Company’s condensed consolidated financial statements as we are not the primary beneficiary since we do not have the power to direct the activities that most significantly impact the VIEs’ economic performance.

 

The Company will periodically reassess whether we are the primary beneficiary in any of these investments. The reassessment process will consider whether we have acquired the power to direct the most significant activities of the VIE through changes in governing documents or other circumstances. Our maximum loss exposure is limited to our combined $6,524,000 carrying value in these equity investments which is included in other investments in the Condensed Consolidated Balance Sheet as of June 30, 2019.