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Schedule II -Condensed Financial Information of Registrant (Parent Company)
 12 Months Ended
Dec. 31, 2021
Condensed Financial Information Of Parent Company Only Disclosure [Abstract]  
Schedule II -Condensed Financial Information of Registrant (Parent Company)

RLI CORP. AND SUBSIDIARIES

 

SCHEDULE II—CONDENSED FINANCIAL INFORMATION OF REGISTRANT

(PARENT COMPANY)

CONDENSED BALANCE SHEETS

 

December 31,

 

(in thousands, except share data)

 

2021

 

 

2020

 

ASSETS

 

 

 

 

 

 

 

 

Cash

 

$

1,433

 

 

$

381

 

Accounts receivable, affiliates

 

 

848

 

 

 

—

 

Investments in subsidiaries

 

 

1,197,997

 

 

 

1,148,342

 

Investments in unconsolidated investee

 

 

113,052

 

 

 

90,893

 

Fixed income:

 

 

 

 

 

 

 

 

Available-for-sale, at fair value

 

 

86,483

 

 

 

64,211

 

(amortized cost of $84,823 and allowance for credit losses of $0 in 2021)

 

 

 

 

 

 

 

 

(amortized cost of $60,657 and allowance for credit losses of $0 in 2020)

 

 

 

 

 

 

 

 

Property and equipment, at cost, net of accumulated depreciation of $1,697 in 2021 and $1,629 in 2020

 

 

1,711

 

 

 

1,779

 

Income taxes receivable - current

 

 

211

 

 

 

1,500

 

Other assets

 

 

2,907

 

 

 

895

 

TOTAL ASSETS

 

$

1,404,642

 

 

$

1,308,001

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

 

Accounts payable, affiliates

 

$

—

 

 

$

2,556

 

Income taxes - deferred

 

 

21,067

 

 

 

16,988

 

Bonds payable, long-term debt

 

 

149,676

 

 

 

149,489

 

Interest payable, long-term debt

 

 

2,153

 

 

 

2,153

 

Other liabilities

 

 

2,385

 

 

 

837

 

TOTAL LIABILITIES

 

$

175,281

 

 

$

172,023

 

 

 

 

 

 

 

 

 

 

SHAREHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Common stock ($0.01 par value)

 

 

 

 

 

 

 

 

(Shares authorized - 200,000,000)

 

 

 

 

 

 

 

 

(68,219,551 shares issued and 45,289,337 shares outstanding in 2021)

 

 

 

 

 

 

 

 

(68,072,794 shares issued and 45,142,580 shares outstanding in 2020)

 

$

682

 

 

$

681

 

Paid-in capital

 

 

343,742

 

 

 

335,365

 

Accumulated other comprehensive earnings

 

 

49,826

 

 

 

108,714

 

Retained earnings

 

 

1,228,110

 

 

 

1,084,217

 

Deferred compensation

 

 

9,642

 

 

 

8,292

 

Treasury stock, at cost (22,930,214 shares in 2021 and 2020)

 

 

(402,641

)

 

 

(401,291

)

TOTAL SHAREHOLDERS’ EQUITY

 

$

1,229,361

 

 

$

1,135,978

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

 

$

1,404,642

 

 

$

1,308,001

 

 

See Notes to Consolidated Financial Statements. See also the accompanying reports of independent registered public accounting firms starting on page 89 of this report.

RLI CORP. AND SUBSIDIARIES

 

SCHEDULE II—CONDENSED FINANCIAL INFORMATION OF REGISTRANT

(PARENT COMPANY)—(continued)

CONDENSED STATEMENTS OF EARNINGS AND COMPREHENSIVE EARNINGS

 

Years ended December 31,

 

(in thousands)

 

2021

 

 

2020

 

 

2019

 

Net investment income

 

$

2,102

 

 

$

1,412

 

 

$

1,656

 

Net realized gains (losses)

 

 

(625

)

 

 

501

 

 

 

463

 

Equity in earnings of unconsolidated investee

 

 

22,786

 

 

 

10,368

 

 

 

13,592

 

Selling, general and administrative expenses

 

 

(13,330

)

 

 

(10,265

)

 

 

(12,686

)

Interest expense on debt

 

 

(7,616

)

 

 

(7,603

)

 

 

(7,588

)

Earnings (loss) before income taxes

 

$

3,317

 

 

$

(5,587

)

 

$

(4,563

)

Income tax benefit

 

 

(1,585

)

 

 

(2,885

)

 

 

(4,989

)

Net earnings (loss) before equity in net earnings of subsidiaries

 

$

4,902

 

 

$

(2,702

)

 

$

426

 

Equity in net earnings of subsidiaries

 

 

274,452

 

 

 

159,793

 

 

 

191,216

 

Net earnings

 

$

279,354

 

 

$

157,091

 

 

$

191,642

 

Other comprehensive earnings (loss), net of tax

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gains (losses) on securities:

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized holding gains (losses) arising during the period

 

$

(1,996

)

 

$

994

 

 

$

1,727

 

Less: reclassification adjustment for (gains) losses included in net earnings

 

 

500

 

 

 

(390

)

 

 

(365

)

Other comprehensive earnings (loss) - parent only

 

$

(1,496

)

 

$

604

 

 

$

1,362

 

Equity in other comprehensive earnings (loss) of subsidiaries/investees

 

 

(57,392

)

 

 

55,615

 

 

 

65,683

 

Other comprehensive earnings (loss)

 

$

(58,888

)

 

$

56,219

 

 

$

67,045

 

Comprehensive earnings

 

$

220,466

 

 

$

213,310

 

 

$

258,687

 

 

See Notes to Consolidated Financial Statements. See also the accompanying reports of independent registered public accounting firms starting on page 89 of this report.

RLI CORP. AND SUBSIDIARIES

 

SCHEDULE II—CONDENSED FINANCIAL INFORMATION OF REGISTRANT

(PARENT COMPANY)—(continued)

CONDENSED STATEMENTS OF CASH FLOWS

 

Years ended December 31,

 

(in thousands)

 

2021

 

 

2020

 

 

2019

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) before equity in net earnings of subsidiaries

 

$

4,902

 

 

$

(2,702

)

 

$

426

 

Adjustments to reconcile net losses to net cash provided by (used in) operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

Net realized (gains) losses

 

 

625

 

 

 

(501

)

 

 

(463

)

Depreciation

 

 

68

 

 

 

67

 

 

 

68

 

Other items, net

 

 

3,966

 

 

 

2,270

 

 

 

2,487

 

Change in:

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate balances receivable/payable

 

 

(3,404

)

 

 

1,246

 

 

 

1,180

 

Federal income taxes

 

 

5,901

 

 

 

1,399

 

 

 

(1,673

)

Changes in investment in unconsolidated investee:

 

 

 

 

 

 

 

 

 

 

 

 

Undistributed earnings

 

 

(22,786

)

 

 

(10,368

)

 

 

(13,592

)

Dividends received

 

 

—

 

 

 

—

 

 

 

13,200

 

Net cash provided by (used in) operating activities

 

$

(10,728

)

 

$

(8,589

)

 

$

1,633

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

 

Purchase of:

 

 

 

 

 

 

 

 

 

 

 

 

Fixed income, available-for-sale

 

$

(33,373

)

 

$

(24,950

)

 

$

(2,507

)

Other

 

 

(2,904

)

 

 

(346

)

 

 

—

 

Sale of:

 

 

 

 

 

 

 

 

 

 

 

 

Fixed income, available-for-sale

 

 

5,306

 

 

 

3,767

 

 

 

14,273

 

Other

 

 

1,245

 

 

 

—

 

 

 

—

 

Call or maturity of:

 

 

 

 

 

 

 

 

 

 

 

 

Fixed income, available-for-sale

 

 

2,878

 

 

 

3,492

 

 

 

29,501

 

Cash dividends received-subsidiaries

 

 

180,000

 

 

 

110,000

 

 

 

34,003

 

Net cash provided by investing activities

 

$

153,152

 

 

$

91,963

 

 

$

75,270

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from stock option exercises

 

$

1,838

 

 

$

8,648

 

 

$

9,490

 

Cash dividends paid

 

 

(147,422

)

 

 

(95,793

)

 

 

(93,315

)

Other

 

 

4,212

 

 

 

3,802

 

 

 

4,058

 

Net cash used in financing activities

 

$

(141,372

)

 

$

(83,343

)

 

$

(79,767

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash

 

$

1,052

 

 

$

31

 

 

$

(2,864

)

Cash at beginning of year

 

 

381

 

 

 

350

 

 

 

3,214

 

Cash at end of year

 

$

1,433

 

 

$

381

 

 

$

350

 

 

Interest paid on outstanding debt amounted to $7.3 million for 2021, 2020 and 2019, respectively. See Notes to Consolidated Financial Statements. See also the accompanying reports of independent registered public accounting firms starting on page 89 of this report.