Allowance for Expected Credit Losses

9 Months Ended

Sep. 30, 2024

Premiums Receivable

The following table provides a roll forward of the allowance for expected credit losses of the Company’s premium receivables:


	Premium Receivables, Net of Allowance		Allowance for Expected Credit Losses
Three Months Ended September 30, 2024
Balance at beginning of period	$	6,268	$	36
Provision on business acquired (1)			16
Change for provision of expected credit losses (2)			—
Balance at end of period	$	6,364	$	52

Three Months Ended September 30, 2023
Balance at beginning of period	$	5,296	$	34

Change for provision of expected credit losses (2)			—
Balance at end of period	$	4,937	$	34

Nine Months Ended September 30, 2024
Balance at beginning of year	$	4,644	$	34
Provision on business acquired (1)			16
Change for provision of expected credit losses (2)			2
Balance at end of period	$	6,364	$	52

Nine Months Ended September 30, 2023
Balance at beginning of year	$	3,625	$	35

Change for provision of expected credit losses (2)			(1)
Balance at end of period	$	4,937	$	34

(1)Represents MCE’s provision for current expected credit losses on premiums receivable. See note 2.

(2)Amounts deemed uncollectible are written-off in operating expenses. For the 2024 third quarter and 2023 third quarter, amounts written off were $1 million and nil, respectively. For the nine months ended September 30, 2024 and 2023 period, amounts written off were $1 million and $2 million, respectively.

Reinsurance Recoverables

The following table provides a roll forward of the allowance for expected credit losses of the Company’s reinsurance recoverables:


	Reinsurance Recoverables, Net of Allowance		Allowance for Expected Credit Losses
Three Months Ended September 30, 2024
Balance at beginning of period	$	7,473	$	20
Change for provision of expected credit losses			(3)
Balance at end of period	$	7,948	$	17

Three Months Ended September 30, 2023
Balance at beginning of period	$	6,717	$	22
Change for provision of expected credit losses			1
Balance at end of period	$	6,821	$	23

Nine Months Ended September 30, 2024
Balance at beginning of year	$	7,064	$	21
Change for provision of expected credit losses			(4)
Balance at end of period	$	7,948	$	17

Nine Months Ended September 30, 2023
Balance at beginning of year	$	6,564	$	22
Change for provision of expected credit losses			1
Balance at end of period	$	6,821	$	23

The following table summarizes the Company’s reinsurance recoverables on paid and unpaid losses (not including ceded unearned premiums):


	September 30,			December 31,
	2024			2023
Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses	$	7,948		$	7,064
% due from carriers with A.M. Best rating of “A-” or better	65.3		%	66.8		%
% due from all other rated carriers	0.0		%	0.1		%
% due from all other carriers with no A.M. Best rating (1)	34.7		%	33.1		%
Largest balance due from any one carrier as % of total shareholders’ equity	7.1		%	7.2		%

(1) At September 30, 2024 and December 31, 2023 over 95% of such amount were collateralized through reinsurance trusts, funds withheld arrangements, letters of credit or other.

Contractholder Receivables

The following table provides a roll forward of the allowance for expected credit losses of the Company’s contractholder receivables:


	Contract-holder Receivables, Net of Allowance		Allowance for Expected Credit Losses
Three Months Ended September 30, 2024
Balance at beginning of period	$	2,016	$	4
Change for provision of expected credit losses			—
Balance at end of period	$	2,078	$	4

Three Months Ended September 30, 2023
Balance at beginning of period	$	1,761	$	3
Change for provision of expected credit losses			—
Balance at end of period	1,805		$	3

Nine Months Ended September 30, 2024
Balance at beginning of year	$	1,814	$	3
Change for provision of expected credit losses			1
Balance at end of period	$	2,078	$	4

Nine Months Ended September 30, 2023
Balance at beginning of year	$	1,731	$	3
Change for provision of expected credit losses			—
Balance at end of period	1,805		$	3