Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

Income Taxes [Abstract]

Schedule of Deferred Tax Assets and Liabilities

The composition of deferred tax assets and liabilities and the related tax effects as of December 31, 2020 and 2019, are as follows (in thousands):

	2020		2019
Deferred tax liabilities:
Deferred policy acquisition costs	$	(3,746)	$	(4,829)
Net unrealized holding gain on investments		(1,579)		(6,408)
Agency relationship		(11)		(17)
Intangible assets		—		(1,882)
Goodwill		—		(357)
Bond amortization		—		(77)
Fixed assets		(1,293)		(1,529)
Other		(343)		(315)
Total deferred tax liabilities		(6,972)		(15,414)
Deferred tax assets:
Unearned premiums		7,639		9,438
Amortization of non-compete agreements		—		36
Intangible assets		308		—
Pension liability		981		842
Net operating loss carry-forward		118		2,154
Unpaid loss and loss adjustment expense		4,688		3,284
Rent reserve		45		18
Bonus accrual		671		722
Deferred social security tax		356		—
Investment impairments		336		489
Other		554		616
Total deferred tax assets		15,696		17,599
Deferred federal income taxes, net	$	8,724	$	2,185

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of the income tax provisions based on the applicable statutory tax rate of 21% to the provisions reflected in the consolidated financial statements for the years ended December 31, 2020 and 2019, respectively, is as follows (in thousands):

	2020		2019
Computed expected income tax (benefit) expense at statutory tax rate	$	(23,974)	$	(217)
Meals and entertainment		28		102
Tax exempt interest		(300)		(421)
Dividends received deduction		(111)		(191)
Goodwill		7,410		—
State taxes (net of federal benefit)		223		414
Rate differential on NOL		(3,383)		—
True up		(2,369)		—
Other		(31)		(94)
Income tax benefit	$	(22,507)	$	(407)
Current income tax benefit	$	(15,994)	$	(1,224)
Deferred tax (benefit) expense		(6,513)		817
Income tax benefit	$	(22,507)	$	(407)

Summary of Operating Loss Carryforwards

The net operating losses will expire if unused, as follows (in thousands):

Year
2022	$	—
2028		2
2029		25
2031		45
2032		77
2033		73
2034		59
2035		33
2036		50
2037		29
2038		—
2039		—
Indefinite		168
	$	561