Goodwill and Intangible Assets Disclosure [Text Block]

6 Months Ended

Jun. 30, 2020

Notes

Goodwill and Intangible Assets Disclosure

Note 8.Goodwill and Other Intangible Assets 

The carrying amount of goodwill at June 30, 2020 and December 31, 2019 was $75,949,000 and $60,165,000, respectively. Of these amounts, the portion attributable to the Specialty Health segment, which includes our InsureTech division, was $71,287,000 and $60,165,000 at June 30, 2020 and December 31, 2019, respectively, and the portion attributable to the Group disability, life, DBL and PFL segment was $4,662,000 and $0, for the same periods, respectively.

As discussed in Note 7, in connection with the acquisitions of Abacus and Torchlight in 2020, the Company recorded $4,662,000 of goodwill associated with the Group disability, life, DBL and PFL segment and $11,122,000 of goodwill associated with the Specialty Health segment.

The Company has net other intangible assets of $15,970,000 and $13,379,000 at June 30, 2020 and December 31, 2019, respectively, which are included in other assets in the Condensed Consolidated Balance Sheets. These intangible assets consist of: (i) finite-lived intangible assets, principally the fair value of acquired agent and broker relationships, which are subject to amortization; and (ii) indefinite-lived intangible assets which consist of the estimated fair value of insurance licenses that are not subject to amortization.

The gross carrying amounts of these other intangible assets are as follows for the periods indicated (in thousands):

		June 30, 2020				December 31, 2019
		Gross				Gross
		Carrying		Accumulated		Carrying		Accumulated
		Amount		Amortization		Amount		Amortization
Finite-lived Intangible Assets:
Agent and broker relationships	$	12,683	$	7,777	$	18,753	$	14,474
Domain		1,000		375		1,000		325
Software systems		2,930		468		780		332
Total finite-lived	$	16,613	$	8,620	$	20,533	$	15,131

		June 30,		December 31,
		2020		2019
Indefinite-lived Intangible Assets:
Insurance licenses	$	7,977	$	7,977
Total indefinite-lived	$	7,977	$	7,977

As discussed in Note 7, in connection with the acquisition of Torchlight, the Company recorded $2,700,000 of intangible assets associated with the Specialty Health segment, of which $1,200,000 represents the fair value of customer relationships being amortized over a weighted average period of 10 years, and $1,500,000 represents software technology being amortized over a weighted average period of 8 years. 

In June 2020, the Company acquired TailTrax, which is an Android and IOS app that contains features valued by pet parents for $650,000 and is being amortized over a weighted average period of 3 years.

Amortization expense was $383,000 and $671,000 for the three and six months ended June 30, 2020, respectively, and was $309,000 and $668,000 for the three and six months ended June 30, 2019, respectively.