Reserves For Claims

6 Months Ended

Jun. 30, 2021

Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract]

Reserve for Claims

Activity in the reserve for claims for the six-month period ended June 30, 2021 and the year ended December 31, 2020 are summarized as follows:


(in thousands)	June 30, 2021		December 31, 2020
Balance, beginning of period	$	33,584	$	31,333
Provision charged to operations	3,027		5,204
Payments of claims, net of recoveries	(1,308)		(2,953)
Balance, end of period	$	35,303	$	33,584

The total reserve for all reported and unreported losses the Company incurred through June 30, 2021 is represented by the reserve for claims on the unaudited Consolidated Balance Sheets. The Company's reserves for unpaid losses and loss adjustment expenses are established using estimated amounts required to settle claims for which notice has been received (reported) and the amount estimated to be required to satisfy claims that have been incurred but not yet reported (“IBNR”). Despite the variability of such estimates, management believes that the total reserve for claims is adequate to cover claim losses which might result from pending and future claims under title insurance policies issued through June 30, 2021. Management continually reviews and adjusts its reserve for claims estimates to reflect its loss experience and any new information that becomes available. Adjustments resulting from such reviews could be significant.

A summary of the Company’s reserve for claims, broken down into its components of known title claims and IBNR, follows:


(in thousands, except percentages)	June 30, 2021		%	December 31, 2020		%
Known title claims	$	3,222	9.1	$	3,585	10.7
IBNR	32,081		90.9	29,999		89.3
Total reserve for claims	$	35,303	100.0	$	33,584	100.0

Claims and losses paid are charged to the reserve for claims. Although claims losses are typically paid in cash, occasionally claims are settled by purchasing the interest of the insured or the claimant in the real property. When this event occurs, the Company carries assets at the lower of cost or estimated fair value, net of any indebtedness on the property.