Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 04, 2019 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | HERITAGE INSURANCE HOLDINGS, INC. | |
Entity Central Index Key | 0001598665 | |
Entity Current Reporting Status | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 29,534,375 | |
Entity File Number | 001-36462 | |
Entity Tax Identification Number | 45-5338504 | |
Entity Address, Address Line One | 2600 McCormick Drive | |
Entity Address, Address Line Two | Suite 300 | |
Entity Address, City or Town | Clearwater | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 33759 | |
City Area Code | 727 | |
Local Phone Number | 362-7200 | |
Entity Interactive Data Current | Yes | |
Entity Incorporation, State or Country Code | DE | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Title of each class | Common Stock, par value $0.0001 per share | |
Trading Symbol(s) | HRTG | |
Name of each exchange on which registered | NYSE |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
ASSETS | ||
Fixed maturities, available-for-sale, at fair value (amortized cost of $604,821 and $518,391) | $ 616,084 | $ 509,649 |
Federal Home Loan Bank (FHLB) stock, at cost | 1,618 | 1,422 |
Equity securities, at fair value, (cost $18,698) | 15,034 | |
Other investments | 27,372 | 2,488 |
Total investments | 645,074 | 528,593 |
Cash and cash equivalents | 229,996 | 250,117 |
Restricted cash | 13,789 | 12,253 |
Accrued investment income | 4,665 | 4,468 |
Premiums receivable, net | 58,115 | 57,000 |
Reinsurance recoverable on paid and unpaid claims | 274,116 | 317,930 |
Prepaid reinsurance premiums | 270,645 | 233,071 |
Income taxes receivable | 10,611 | 35,586 |
Deferred policy acquisition costs, net | 75,613 | 73,055 |
Property and equipment, net | 20,873 | 17,998 |
Intangibles, net | 70,569 | 76,850 |
Goodwill | 152,459 | 152,459 |
Other assets | 16,354 | 9,333 |
Total Assets | 1,842,879 | 1,768,713 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Unpaid losses and loss adjustment expenses | 417,586 | 432,359 |
Unearned premiums | 484,849 | 472,357 |
Reinsurance payable | 254,152 | 166,975 |
Long-term debt, net | 130,849 | 148,794 |
Deferred income tax, net | 14,278 | 7,705 |
Advance premiums | 21,244 | 20,000 |
Accrued compensation | 8,263 | 9,226 |
Accounts payable and other liabilities | 66,428 | 85,964 |
Total Liabilities | 1,397,649 | 1,343,380 |
Commitments and contingencies (Note 17) | ||
Stockholders’ Equity: | ||
Common stock, $0.0001 par value, 50,000,000 shares authorized, 29,534,375 shares issued and 28,963,841 shares outstanding at September 30, 2019; 30,083,559 shares issued and 29,477,756 shares outstanding at December 31, 2018 | 3 | 3 |
Additional paid-in capital | 331,558 | 325,292 |
Accumulated other comprehensive income (loss) | 8,550 | (6,527) |
Treasury stock, at cost, 8,036,560 and 7,214,797 shares, respectively | (101,078) | (89,185) |
Retained earnings | 206,197 | 195,750 |
Total Stockholders' Equity | 445,230 | 425,333 |
Total Liabilities and Stockholders' Equity | $ 1,842,879 | $ 1,768,713 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Fixed maturities, at amortized cost | $ 604,821 | $ 518,391 |
Equity securities, cost | $ 18,698 | |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 29,534,375 | 30,083,559 |
Common stock, shares outstanding | 28,963,841 | 29,477,756 |
Treasury stock, shares | 8,036,560 | 7,214,797 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Other Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
REVENUES: | ||||
Gross premiums written | $ 237,303 | $ 233,613 | $ 702,491 | $ 701,643 |
Change in gross unearned premiums | (5,686) | 551 | (12,326) | (9,345) |
Gross premiums earned | 231,617 | 234,164 | 690,165 | 692,298 |
Ceded premiums | (107,755) | (115,926) | (342,529) | (356,748) |
Net premiums earned | 123,862 | 118,238 | 347,636 | 335,550 |
Net investment income | 3,655 | 3,847 | 11,157 | 9,704 |
Net realized and unrealized gains (losses) | 805 | (123) | 3,132 | (1,234) |
Other revenue | 3,377 | 3,333 | 10,878 | 11,273 |
Total revenues | 131,699 | 125,295 | 372,803 | 355,293 |
EXPENSES: | ||||
Losses and loss adjustment expenses | 70,052 | 58,695 | 206,490 | 177,775 |
Policy acquisition costs, net of ceding commission income for the three and nine months ended September 30, 2019 of $11.3 million and $36.8 million, respectively | 26,686 | 26,569 | 79,793 | 58,167 |
General and administrative expenses, net of ceding commission income for the three and nine months ended September 30, 2019 of $3.7 million and $12 million, respectively | 21,477 | 25,815 | 58,465 | 72,167 |
Total expenses | 118,215 | 111,079 | 344,748 | 308,109 |
Operating income | 13,484 | 14,216 | 28,055 | 47,184 |
Interest expense, net | 2,401 | 5,225 | 6,502 | 15,431 |
Other non-operating (income)/loss, net | 48 | (542) | ||
Income before income taxes | 11,083 | 8,991 | 21,505 | 32,295 |
Provision for income taxes | 2,950 | 3,002 | 5,687 | 9,068 |
Net income | 8,133 | 5,989 | 15,818 | 23,227 |
OTHER COMPREHENSIVE INCOME | ||||
Change in net unrealized gains (losses) on investments | 4,429 | (2,895) | 19,533 | (9,918) |
Reclassification adjustment for net realized investment losses | (103) | (5) | 291 | 307 |
Income tax (expense) benefit related to items of other comprehensive income | (1,035) | 1,665 | (4,747) | 3,249 |
Total comprehensive income | $ 11,424 | $ 4,754 | $ 30,895 | $ 16,865 |
Weighted average shares outstanding | ||||
Basic | 29,109,962 | 25,631,871 | 29,329,742 | 25,663,415 |
Diluted | 29,168,392 | 26,046,938 | 29,352,756 | 26,340,759 |
Earnings per share | ||||
Basic | $ 0.28 | $ 0.23 | $ 0.54 | $ 0.91 |
Diluted | $ 0.28 | $ 0.23 | $ 0.54 | $ 0.88 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Operations and Other Comprehensive Income (Parenthetical) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Ceding commission income | $ 15,062 | $ 48,828 |
Policy Acquisition Costs [Member] | ||
Ceding commission income | 11,300 | 36,800 |
General and Administrative Expenses [Member] | ||
Ceding commission income | $ 3,700 | $ 12,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Shares Issued [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Treasury Shares [Member] | Accumulated Other Comprehensive Income/(Loss) [Member] |
Beginning Balance at Dec. 31, 2017 | $ 379,816 | $ 3 | $ 294,836 | $ 175,226 | $ (87,185) | $ (3,064) |
Beginning Balance, Shares at Dec. 31, 2017 | 25,885,006 | |||||
Cumulative effective of change in accounting principle (ASU 2016-01), net of tax at Dec. 31, 2017 | (267) | 267 | ||||
Beginning balance as adjusted at Dec. 31, 2017 | 379,816 | $ 3 | 294,836 | 174,959 | (87,185) | (2,797) |
Net unrealized change in investments, net of tax | (4,428) | (4,428) | ||||
Stock buy-back | (2,000) | (2,000) | ||||
Stock buy-back, Shares | (115,200) | |||||
Stock-based compensation | 1,306 | 1,306 | ||||
Reclassification of income taxes upon early adoption of ASU 2018-02 | 424 | (424) | ||||
APIC deferred tax adj | 970 | 970 | ||||
Dividends declared on common stock | (1,601) | (1,601) | ||||
Net income | 14,830 | 14,830 | ||||
Ending balance at Mar. 31, 2018 | 388,893 | $ 3 | 297,112 | 188,612 | (89,185) | (7,649) |
Ending balance, Shares at Mar. 31, 2018 | 25,769,806 | |||||
Beginning Balance at Dec. 31, 2017 | 379,816 | $ 3 | 294,836 | 175,226 | (87,185) | (3,064) |
Beginning Balance, Shares at Dec. 31, 2017 | 25,885,006 | |||||
Cumulative effective of change in accounting principle (ASU 2016-01), net of tax at Dec. 31, 2017 | (267) | 267 | ||||
Beginning balance as adjusted at Dec. 31, 2017 | 379,816 | $ 3 | 294,836 | 174,959 | (87,185) | (2,797) |
Net income | 23,227 | |||||
Ending balance at Sep. 30, 2018 | 390,556 | $ 3 | 295,500 | 193,821 | (89,185) | (9,583) |
Ending balance, Shares at Sep. 30, 2018 | 25,769,806 | |||||
Beginning Balance at Mar. 31, 2018 | 388,893 | $ 3 | 297,112 | 188,612 | (89,185) | (7,649) |
Beginning Balance, Shares at Mar. 31, 2018 | 25,769,806 | |||||
Net unrealized change in investments, net of tax | (699) | (699) | ||||
Stock-based compensation on vested restricted stock | 1,306 | 1,306 | ||||
Convertible Option debt extinguishment, net of tax | (4,235) | (4,235) | ||||
Dividends declared on common stock | (1,593) | (1,593) | ||||
Net income | 2,408 | 2,408 | ||||
Ending balance at Jun. 30, 2018 | 386,080 | $ 3 | 294,183 | 189,427 | (89,185) | (8,348) |
Ending balance, Shares at Jun. 30, 2018 | 25,769,806 | |||||
Net unrealized change in investments, net of tax | (1,235) | (1,235) | ||||
Stock-based compensation on vested restricted stock | 1,317 | 1,317 | ||||
Dividends declared on common stock | (1,595) | (1,595) | ||||
Net income | 5,989 | 5,989 | ||||
Ending balance at Sep. 30, 2018 | 390,556 | $ 3 | 295,500 | 193,821 | (89,185) | (9,583) |
Ending balance, Shares at Sep. 30, 2018 | 25,769,806 | |||||
Beginning Balance at Dec. 31, 2018 | 425,333 | $ 3 | 325,292 | 195,750 | (89,185) | (6,527) |
Beginning Balance, Shares at Dec. 31, 2018 | 29,477,756 | |||||
Net unrealized change in investments, net of tax | 5,963 | 5,963 | ||||
Restricted stock vested, net of surrendered shares | (118) | (118) | ||||
Restricted stock vested, net of surrendered shares, Shares | 17,000 | |||||
Stock-based compensation on vested restricted stock | 1,345 | 1,345 | ||||
Convertible Option debt extinguishment, net of tax | (1,840) | (1,840) | ||||
Stock issued on convertible note conversion | 4,210 | 4,210 | ||||
Stock issued on convertible note conversion, Shares | 285,201 | |||||
Stock buy-back | (5,011) | (5,011) | ||||
Stock buy-back, Shares | (347,740) | |||||
Tax rate change | 48 | 48 | ||||
Dividends declared on common stock | (1,807) | (1,807) | ||||
Net income | 6,964 | 6,964 | ||||
Ending balance at Mar. 31, 2019 | 435,087 | $ 3 | 328,937 | 200,907 | (94,196) | (564) |
Ending balance, Shares at Mar. 31, 2019 | 29,432,217 | |||||
Beginning Balance at Dec. 31, 2018 | 425,333 | $ 3 | 325,292 | 195,750 | (89,185) | (6,527) |
Beginning Balance, Shares at Dec. 31, 2018 | 29,477,756 | |||||
Net income | 15,818 | |||||
Ending balance at Sep. 30, 2019 | 445,230 | $ 3 | 331,558 | 206,197 | (101,078) | 8,550 |
Ending balance, Shares at Sep. 30, 2019 | 28,963,841 | |||||
Beginning Balance at Mar. 31, 2019 | 435,087 | $ 3 | 328,937 | 200,907 | (94,196) | (564) |
Beginning Balance, Shares at Mar. 31, 2019 | 29,432,217 | |||||
Net unrealized change in investments, net of tax | 5,823 | 5,823 | ||||
Stock-based compensation on vested restricted stock | 1,344 | 1,344 | ||||
Stock buy-back | (2,333) | (2,333) | ||||
Stock buy-back, Shares | (157,640) | |||||
Dividends declared on common stock | (1,792) | (1,792) | ||||
Net income | 721 | 721 | ||||
Ending balance at Jun. 30, 2019 | 438,850 | $ 3 | 330,281 | 199,836 | (96,529) | 5,259 |
Ending balance, Shares at Jun. 30, 2019 | 29,274,577 | |||||
Net unrealized change in investments, net of tax | 3,291 | 3,291 | ||||
Restricted stock vested, net of surrendered shares | (68) | (68) | ||||
Restricted stock vested, net of surrendered shares, Shares | 5,647 | |||||
Stock-based compensation on vested restricted stock | 1,345 | 1,345 | ||||
Stock buy-back | $ (4,549) | (4,549) | ||||
Stock buy-back, Shares | (316,383) | (316,383) | ||||
Dividends declared on common stock | $ (1,772) | (1,772) | ||||
Net income | 8,133 | 8,133 | ||||
Ending balance at Sep. 30, 2019 | $ 445,230 | $ 3 | $ 331,558 | $ 206,197 | $ (101,078) | $ 8,550 |
Ending balance, Shares at Sep. 30, 2019 | 28,963,841 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
OPERATING ACTIVITIES | ||
Net income | $ 15,818,000 | $ 23,227,000 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Stock-based compensation | 4,034,000 | 3,929,000 |
Bond amortization and accretion | 3,896,000 | 4,935,000 |
Amortization of original issuance discount on debt | 1,073,000 | 3,188,000 |
Depreciation and amortization | 8,274,000 | 21,408,000 |
Net realized losses | 291,000 | 307,000 |
Net unrealized investment gains | (3,423,000) | |
Net (gain)/loss from repurchase of debt | 48,000 | (542,000) |
Deferred income taxes | 185,000 | (17,301,000) |
Changes in operating assets and liabilities: | ||
Accrued investment income | (197,000) | 1,304,000 |
Premiums receivable, net | (1,115,000) | (1,332,000) |
Prepaid reinsurance premiums | (37,574,000) | (54,885,000) |
Reinsurance recoverable on paid and unpaid claims | 43,814,000 | 32,531,000 |
Income taxes receivable | 24,975,000 | 1,089,000 |
Deferred policy acquisition costs, net | (2,558,000) | (34,024,000) |
Other assets | (7,021,000) | 4,698,000 |
Unpaid losses and loss adjustment expenses | (14,773,000) | (48,988,000) |
Unearned premiums | 12,492,000 | 9,346,000 |
Reinsurance payable | 87,177,000 | 199,445,000 |
Accrued interest | 176,000 | (757,000) |
Accrued compensation | (963,000) | (5,991,000) |
Advance premiums | 1,244,000 | 9,787,000 |
Income taxes payable | (8,196,000) | |
Other liabilities | (11,524,000) | (91,031,000) |
Net cash provided by operating activities | 116,153,000 | 60,343,000 |
INVESTING ACTIVITIES | ||
Fixed maturity securities sales, maturities and paydowns | 106,830,000 | 228,457,000 |
Fixed maturity securities purchases | (200,540,000) | (208,303,000) |
Equity securities sales | 26,521,000 | 4,209,000 |
Equity securities purchases | (4,583,000) | (3,804,000) |
Limited partnership interest | (24,006,000) | |
Proceeds from sale of assets | 65,000 | |
Cost of property and equipment acquired | (4,933,000) | (1,425,000) |
Net cash (used in) provided by investing activities | (100,646,000) | 19,134,000 |
FINANCING ACTIVITIES | ||
Repayment of term note | (13,750,000) | |
Mortgage loan payments | (206,000) | (196,000) |
Repurchase of convertible notes | (2,869,000) | (13,248,000) |
Purchase of treasury stock | (11,893,000) | (2,000,000) |
Tax withholdings on share-based compensation awards | (186,000) | |
Dividends paid | (5,188,000) | (4,789,000) |
Net cash used in financing activities | (34,092,000) | (20,233,000) |
(Decrease) increase in cash, cash equivalents, and restricted cash | (18,585,000) | 59,244,000 |
Cash, cash equivalents and restricted cash, beginning of period | 262,370,000 | 174,530,000 |
Cash, cash equivalents and restricted cash, end of period | 243,785,000 | 233,774,000 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Income taxes paid | 13,849,000 | 25,267,000 |
Interest paid | 5,206,000 | $ 14,265,000 |
Issuance of shares on conversion of convertible notes | $ 4,210,000 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Parenthetical) (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2017 |
Statement Of Cash Flows [Abstract] | ||||
Cash and cash equivalents | $ 229,996 | $ 250,117 | ||
Restricted cash | 13,789 | 12,253 | ||
Total | $ 243,785 | $ 262,370 | $ 233,774 | $ 174,530 |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation and Significant Accounting Policies | NOTE 1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The condensed consolidated financial statements include the accounts of Heritage Insurance Holdings, Inc. (together with its subsidiaries, the “Company”). These statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain financial information that is normally included in annual consolidated financial statements prepared in accordance with GAAP, but that is not required for interim reporting purposes, has been omitted. In the opinion of the Company’s management, all material intercompany transactions and balances have been eliminated and all adjustments consisting of normal recurring accruals which are necessary for a fair statement of the financial condition and results of operations for the interim periods have been reflected. The accompanying interim condensed consolidated financial statements and related footnotes should be read in conjunction with the Company’s audited consolidated financial statements and related footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (the “ 2018 Form 10- K”). Significant accounting policies The Accounting policies of the Company are set forth in Note 1 to Condensed Consolidated Financial Statements contained in the Company’s 2018 Annual Report on Form 10-K. We include herein certain updates to those policies. Leases At the inception of a contract, we assess whether the contract is, or contains, a lease. The assessment is based on (1) whether the contract involves the use of distinct identified assets, (2) whether the Company obtains the right to substantially all the economic benefit from the use of the asset throughout the period, and (3) whether the Company has the right to direct the use of the asset. All significant lease arrangements are generally recognized at lease commencement. A right of use (“ROU”) asset and corresponding lease liability are not recorded for leases with an initial term of 12 months or less (short term leases) and we recognize lease expense for these leases as incurred over the lease term. ROU assets represent our right to use an underlying asset during the reasonably certain lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Our lease terms include options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Operating lease ROU assets and liabilities are recognized based on the present value of lease payments not yet paid. Lease payments may be fixed or variable, however, only fixed payments or in-substance fixed payments are included in determining the lease liability. Variable lease payments are recognized in operating expenses in the period in which the obligation for those payments are incurred. The operating lease ROU asset also includes any lease payments related to initial direct cost and prepayments and excludes lease incentives. Lease expense is recognized on a straight-line basis over the term of the lease. We have lease agreements with lease and non-lease components, which are generally accounted for separately. We primarily use our incremental borrowing rates for our operating leases (rates are not readily determinable) and implicit rates for our financing leases in determining the present value of lease payments. In the first quarter of 2019, the Company adopted ASU 2016 -02 and did not recognize an opening adjustment to retained earnings as a result of the adoption of FASB 842. Refer to Note 5-Leases herein for further information. Reclassification Certain prior year amounts have been reclassified to conform to the current year presentation. Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases We adopted the guidance prospectively during the first quarter of 2019. As part of our adoption, we elected not to reassess historical lease classification or recognize short-term leases on our balance sheet. At implementation, we recorded approximately $2.8 million as right-of-use operating and financing We did not recognize an opening adjustment to retained earnings. Note 5 Accounting Pronouncements Not Yet Adopted In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments Financial Instruments-Overall Recognition and Measurement of Financial Assets and Financial Liabilities FASB ASU 2016-13 Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments The Company’s implementation activities, which remain in process, include the development of models, methodologies, data input and assumptions to be used in estimating expected credit losses. The implementation primarily impacts the Company’s debt securities and reinsurance recoverable balances. The adoption of this standard is not expected to be material to our financial position, results of operations or cash flows. For information regarding other accounting standards that the Company has not yet adopted, refer to our Annual Report on Form 10-K, filed on March 12, 2019, the section of Note 1 of the notes to the consolidated financial statements entitled the “Accounting Pronouncement Not Yet Adopted”. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2019 | |
Investments Debt And Equity Securities [Abstract] | |
Investments | NOTE 2. INVESTMENTS Securities Available-for-Sale The following table details the difference between cost or adjusted/amortized cost and estimated fair value, by major investment category, at September 30, 2019 and December 31, 2018: September 30, 2019 Cost or Adjusted / Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities, available-for-sale (In thousands) U.S. government and agency securities (1) $ 62,492 $ 521 $ 24 $ 62,989 States, municipalities and political subdivisions 79,141 2,090 20 81,211 Special revenue 264,897 4,782 160 269,519 Industrial and miscellaneous 198,291 4,118 44 202,365 Total $ 604,821 $ 11,511 $ 248 $ 616,084 December 31, 2018 Cost or Adjusted / Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities, available-for-sale (In thousands) U.S. government and agency securities (1) $ 48,739 $ 40 $ 738 $ 48,041 States, municipalities and political subdivisions 60,028 46 785 59,289 Special revenue 249,026 210 3,881 245,355 Industrial and miscellaneous 155,678 81 3,302 152,457 Redeemable preferred stocks 4,920 — 413 4,507 Total $ 518,391 $ 377 $ 9,119 $ 509,649 (1) U.S. government and agency securities include pledged fixed maturity securities with an estimated fair value of $24.5 million and $31.0 million under the terms and condition of the advance agreement entered into with a financial institution as of September 30, 2019 and December 31, 2018, respectively. The Company is permitted to withdraw or exchange any portion of the pledged collateral over the minimum requirement at any time. The Company calculates the gain or loss realized on the sale of investments by comparing the sales price (fair value) to the cost or adjusted/amortized cost of the security sold. The Company determines the cost or adjusted/amortized cost of the security sold using the specific-identification method. The following tables detail the Company’s net realized gains (losses) by major investment category for the three and nine months ended September 30, 2019 and 2018. 2019 2018 Gains (Losses) Fair Value at Sale Gains (Losses) Fair Value at Sale Three Months Ended September 30, (In thousands) Fixed maturity securities $ 108 $ 43,255 $ — $ 15 Equity securities — — 1 173 Total realized gains 108 43,255 1 173 Fixed maturity securities — 2,317 — — Equity securities — — (8 ) 263 Total realized losses — 2,317 (8 ) 263 Net realized gains and (losses) $ 108 $ 45,572 $ (7 ) $ 436 2019 2018 Gains (Losses) Fair Value at Sale Gains (Losses) Fair Value at Sale Nine Months Ended September 30, (In thousands) Fixed maturity securities $ 958 $ 45,143 $ 78 $ 27,443 Equity securities 1,323 22,604 1 169 Total realized gains 2,281 67,747 79 27,612 Fixed maturity securities (76 ) 2,611 (237 ) 49,025 Equity securities (67 ) 2,374 (185 ) 4,193 Total realized losses (143 ) 4,985 (422 ) 53,218 Net realized gains and (losses) $ 2,138 $ 72,732 $ (343 ) $ 80,830 Gains (losses) on equity investments consists of realized and unrealized holding gains or losses on marketable equity investments and fair value adjustment, including, if any, impairments on nonmarketable equity investments. For the three and nine months ended September 30, 2018, the Company reclassed $128,000 and $927,000 from changes in the fair value of equity investments from Other revenue to Net realized and unrealized gains (losses) to conform to current presentation, respectively. For the three months ended September 30, 2019 the Company sold no equity securities nor did it hold any marketable equity securities as of that date. For the three months ended September 30, 2018, the Company received proceeds from the sale of marketable equity securities of approximately $428,000. The Company recorded a gross gain of $7,900 and a gross loss from these sales of approximately $14,700. For the nine months ended September 30, 2019 and 2018, the Company received proceeds from the sale of its holdings in marketable equity securities of approximately $26.5 million and $4.2 million. These sales resulted in a gross gain of $2.4 million and a gross loss of $1.2 million respectively, and a gross gain of approximately $1,100 and a gross loss of $184,500, respectively, related primarily to unrealized holding gains or losses in certain marketable equity securities. For the nine months ended September 30, 2019, the Company had unrealized net holding gains of $993,600 recognized on nonmarketable other investments still held at September 30, 2019. The table below summarizes the Company’s fixed maturity securities at September 30, 2019 by contractual maturity periods. Actual results may differ as issuers may have the right to call or prepay obligations, with or without penalties, prior to the contractual maturity of those obligations. At September 30, 2019 Cost or Amortized Cost Percent of Total Fair Value Percent of Total Maturity dates: (In thousands) (In thousands) Due in one year or less $ 67,878 11 % $ 68,007 11 % Due after one year through five years 199,455 33 % 201,696 33 % Due after five years through ten years 139,435 23 % 144,386 23 % Due after ten years 198,053 33 % 201,995 33 % Total $ 604,821 100 % $ 616,084 100 % The following table summarizes the Company’s net investment income by major investment category for the three and nine months ended September 30, 2019 and 2018, respectively: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) Fixed maturity securities $ 3,492 $ 3,020 $ 10,625 $ 8,018 Equity securities 22 547 944 1,252 Cash and cash equivalents 558 284 1,288 861 Other investments 324 425 258 1,168 Net investment income 4,396 4,276 13,115 11,299 Less: Investment expenses 741 429 1,958 1,595 Net investment income, less investment expenses $ 3,655 $ 3,847 $ 11,157 $ 9,704 The following tables present an aging of our unrealized losses on fixed maturity investments by investment class as of September 30, 2019 and December 31, 2018: Less Than Twelve Months Twelve Months or More September 30, 2019 Number of Securities Gross Unrealized Losses Fair Value Number of Securities Gross Unrealized Losses Fair Value Fixed maturity securities, available-for-sale (In thousands) U.S. government and agency securities 4 2 $ 450 25 $ 22 $ 4,523 States, municipalities and political subdivisions 2 14 6,026 4 6 2,456 Industrial and miscellaneous 20 14 6,027 31 30 10,195 Special revenue 52 22 13,154 123 138 18,524 Total fixed maturity securities 78 $ 52 $ 25,657 183 $ 196 $ 35,698 Less Than Twelve Months Twelve Months or More December 31, 2018 Number of Securities Gross Unrealized Losses Fair Number of Securities Gross Unrealized Losses Fair Value Fixed maturity securities, available-for-sale (In thousands) U.S. government and agency securities 17 $ 129 $ 10,485 66 $ 609 $ 20,488 States, municipalities and political subdivisions 13 103 12,864 42 682 39,979 Industrial and miscellaneous 214 1,479 70,156 232 1,822 70,375 Special revenue 105 1,260 76,335 323 2,621 108,319 Redeemable preferred stocks 55 193 2,541 27 221 1,965 Total fixed maturity securities 404 $ 3,164 $ 172,381 690 $ 5,955 $ 241,126 The Company is required to maintain assets on deposit with various regulatory authorities or in trust accounts to support its insurance and reinsurance operations. As of September 30, 2019, the Company evaluated its fixed maturity securities for impairment and determined that none of its investments in fixed maturity securities that reflected an unrealized loss position were other-than-temporarily impaired. The issuers of the fixed maturity securities in which the Company invests continue to make interest payments on a timely basis and have not suffered any credit rating reductions. The Company does not intend to sell, nor is it likely that it would be required to sell, the fixed maturity securities before the Company recovers its amortized cost basis. Limited Partnerships, REIT’s and Limited Liability Company Investments The Company has interests in limited partnerships (“LPs”) that are not registered or readily tradable on a securities exchange. The investments are private equity funds managed by general partners who make financial policy and operational decisions. The Company is not the primary beneficiary and does not consolidate these partnerships. As of September 30, 2019, the estimated fair value of our investments in the LPs interests was $21.0 million. The general partner's objective is to achieve capital appreciation through investments in marketable securities and broad markets, preferred stock, industry-focused and fixed income exchange-traded funds (ETFs). These funds are carried at net asset value, which approximates fair value with changes in fair value recorded in net realized gains (losses) on the Company’s condensed consolidated statement of income and comprehensive income. Realized gains (losses) on sales of these investments are reported within net realized and unrealized gains (losses) on the Company’s condensed consolidated statement of income and comprehensive income . The Company has an interest in limited liability companies (“LLCs”) that are not registered or readily tradable on a securities exchange. The investments are in LLCs that maintains a specific ownership account for each investor, similar to a partnership capital account structure, and are viewed as similar to an investment in a LP for purposes of determining whether a noncontrolling investment in an LLC shall be accounted for using the cost method or the equity method. The Company receives monthly returns of capital from the LLCs which reduces the fair value of the Company’s investments. As of September 30, 2019, the estimated fair value of the Company’s investments in the LLCs was $6.4 million. The interest expenses from these funds are recorded to net investment income. For the nine months ended September 30, 2019, the Company invested $24.9 million in LPs and LLCs. For the comparable period of 2018, the Company did not make acquisition of this category of assets. For the nine month period ended September 30, 2019, the Company recognized net investment gains in LPs in aggregate of $1.0 million. As of the third quarter of 2019 and 2018, the Company received cash distributions, net of allocations from its LLC investments of approximately $272,000 and $94,000, respectively, representing return of capital on its investments. The Company incurred approximately $565,000 of allocated costs during the third quarter of 2019 and $1,300 for the comparable period of 2018. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | NOTE 3. FAIR VALUE OF FINANCIAL INSTRUMENTS The Company performs fair value measurements in accordance with FASB Accounting Standards Codification (ASC) 820, Fair Value Measurement For the Company’s investments in U.S. government securities that do not have prices in active markets, agency securities, state and municipal governments, and corporate bonds, the Company obtains the fair values from its third-party valuation service and evaluates the relevant inputs, assumptions, methodologies and conclusions associated with such valuations. The valuation service calculates prices for the Company’s investments in the aforementioned security types on a month-end basis by using several matrix-pricing methodologies that incorporate inputs from various sources. The model the valuation service uses to price U.S. government securities and securities of states and municipalities incorporates inputs from active market makers and inter-dealer brokers. To price corporate bonds and agency securities, the valuation service calculates non-call yield spreads on all issuers, uses option-adjusted yield spreads to account for any early redemption features, then adds final spreads to the U.S. Treasury curve as of quarter end. The inputs the valuation service uses in their calculations are not quoted prices in active markets, but are observable inputs, and therefore represent Level 2 inputs. As of September 30, 2019, and December 31, 2018, there were no transfers in or out of Level 1, 2, and 3. Investments excluded from the fair value hierarchy The Company also invests in real estate investment trusts (“REIT”), private LPs and LLCs. This investment categorization has the potential for higher returns but also the potential for higher degrees of risk, including less than stable rates of returns and may provide less liquidity. Fair value estimates of the LPs and LLCs are based on their net asset values, as reported by the manager of the LP or LLC. The fair value of these investments is measured at net asset value and is excluded from the fair value hierarchy. For the current LPs, the Company may, as of the last day of each calendar quarter, upon at least 65 days’ prior written notice, withdraw all or any portion of the balance in its investment. There is a 3% withdrawal fee if made during the first year of investment that expires in February 2020. September 30, 2019 Total Level 1 Level 2 Level 3 Invested Assets: (In thousands) Fixed maturity securities, available-for-sale: U.S. government and agency securities $ 62,989 $ 366 $ 62,623 $ — States, municipalities and political subdivisions 81,211 — 81,211 — Special revenue 269,519 — 269,519 — Industrial and miscellaneous 202,365 — 202,365 — Total fixed maturity securities 616,084 366 615,718 — Investments reported at NAV (1) 28,990 — — — Total investments $ 645,074 $ 366 $ 615,718 $ — December 31, 2018 Total Level 1 Level 2 Level 3 Invested Assets: (In thousands) Fixed maturity securities, available-for-sale: U.S. government and agency securities $ 48,041 $ 354 $ 47,687 $ — States, municipalities and political subdivisions 59,289 — 59,289 — Special revenue 245,355 — 245,355 — Industrial and miscellaneous 152,457 — 152,457 — Redeemable preferred stocks 4,507 4,507 — — Total fixed maturity securities 509,649 4,861 504,788 — Equity securities Common stock 2,264 2,264 — — Non-redeemable preferred stock 12,770 12,770 — — Total equity securities 15,034 15,034 — — Investments reported at NAV (1) 3,910 — — — Total investments $ 528,593 $ 19,895 $ 504,788 $ — (1) Includes $1.6 million and $1.4 million of Federal Home Loan Banks membership shares held by the Company as of September 30, 2019 and December 31, 2018, respectively. Non-recurring fair value measurements Assets and liabilities that are measured at fair value on a non-recurring basis include intangible assets and goodwill which are recognized at fair value during the period in which an acquisition is completed, from updated estimates and assumptions during the measurement period, or when they are considered to be impaired. These non-recurring fair value measurements, primarily for intangible assets acquired, were based on Level 3 unobservable inputs. For the quarters ended September 30, 2019 and 2018, these non-recurring fair values inputs consisted of brand, agent relationships, renewal rights, customer relations, trade names, non-compete and goodwill. To evaluate such assets for a potential impairment, we determine the fair value of the goodwill and intangible assets using a combination of a discounted cash flow approach and market approaches, which contain significant unobservable inputs and therefore are considered a Level 3 fair value measurement. The unobservable inputs in the analysis generally include future cash flow projections and a discount rate. There were no non-recurring fair value adjustments to intangible assets and goodwill during the third quarters of 2019 and 2018. We record any measurement period adjustments to the fair value of assets acquired and liabilities assumed, with the corresponding offset to goodwill. |
Other Comprehensive Income
Other Comprehensive Income | 9 Months Ended |
Sep. 30, 2019 | |
Comprehensive Income Net Of Tax [Abstract] | |
Other Comprehensive Income | NOTE 4. OTHER COMPREHENSIVE INCOME Other comprehensive income (loss) was $15.1 million and $(6.4) million for the nine months ended September 30, 2019 and 2018, respectively. The difference between net income as reported and comprehensive income was due to the changes in unrealized gains and losses, net of taxes on fixed maturities securities. For the Three Months Ended September 30, 2019 2018 Pre-tax Tax After-tax Pre-tax Tax After-tax (in thousands) Other comprehensive income Change in unrealized losses on investments, net $ 4,429 $ (1,060 ) $ 3,369 $ (2,895 ) $ 1,666 $ (1,229 ) Reclassification adjustment of realized losses (gains) included in net income (103 ) 25 (78 ) (5 ) (1 ) (6 ) Effect on other comprehensive income $ 4,326 $ (1,035 ) $ 3,291 $ (2,900 ) $ 1,665 $ (1,235 ) For the Nine Months Ended September 30, 2019 2018 Pre-tax Tax After-tax Pre-tax Tax After-tax (in thousands) Other comprehensive income Change in unrealized losses on investments, net $ 19,533 $ (4,677 ) $ 14,856 $ (9,918 ) $ 3,185 $ (6,733 ) Reclassification adjustment of realized losses (gains) included in net income 291 (70 ) 221 307 64 371 Effect on other comprehensive income $ 19,824 $ (4,747 ) $ 15,077 $ (9,611 ) $ 3,249 $ (6,362 ) |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | NOTE 5. LEASES The Company has entered into operating and financing leases primarily for real estate and vehicles. The Company will determine whether an arrangement is a lease at inception of the agreement. The operating leases have terms of one to ten years, and often include one or more options to renew. These renewal terms can extend the lease term from two to ten years, and are included in the lease term when it is reasonably certain that the Company will exercise the option. The Company considers these options in determining the lease term used in establishing our right-of-use assets and lease obligations. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Because the rate implicit in each operating lease is not readily determinable, the Company uses its incremental borrowing rate to determine present value of the lease payments. The Company used the implicit rates within the finance leases. Components of our lease costs for the three and nine months ended September 30, 2019 are as follows (in thousands): Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Amortization of ROU assets - Finance leases $ 19 $ 58 Interest on lease liabilities - Finance leases 6 17 Variable lease cost (cost excluded from lease payments) 113 337 Operating lease cost (cost resulting from lease payments) 331 918 Total lease cost $ 469 $ 1,330 Supplemental cash flow information and non-cash activity related to our operating and financing leases as of September 30, 2019 are as follows (in thousands): Nine Months Ended September 30, 2019 Finance lease - Operating cash flows $ 20 Finance lease - Financing cash flows $ 66 Operating lease - Operating cash flows (fixed payments) $ 613 Operating lease - Operating cash flows (liability reduction) $ 465 Supplemental balance sheet information related to our operating and financing leases as of September 30, 2019 are as follows (in thousands): Balance Sheet Classification September 30, 2019 Right-of-use assets - operating Other assets $ 6,567 Right-of-use assets - finance Other assets $ 323 Lease Liability (1) Accounts payable and other liabilities $ (8,293 ) Lease Liability - finance Accounts payable and other liabilities $ (342 ) (1) Includes $1.3 million in lease incentives received in the first quarter of 2019. Weighted-average remaining lease term and discount rate for our operating and financing leases as of September 30, 2019 are as follows: September 30, 2019 Weighted average lease term - Finance leases 3.91 yrs. Weighted average lease term - Operating leases 8.19 yrs. Weighted average discount rate - Finance leases 7.09 % Weighted average discount rate - Operating leases 5.32 % Maturities of lease liabilities by fiscal year for our operating and financing leases as of September 30, 2019 are as follows (in thousands): September 30, 2019 2019 remaining $ 380 2020 1,442 2021 1,401 2022 1,425 2023 1,371 2024 and thereafter 4,695 Total lease payments 10,714 Less: imputed interest (2,079 ) Present value of lease liabilities $ 8,635 |
Property and Equipment, Net
Property and Equipment, Net | 9 Months Ended |
Sep. 30, 2019 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment, Net | NOTE 6. PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of the following at September 30, 2019 and December 31, 2018: September 30, 2019 December 31, 2018 (In thousands) Land $ 2,582 $ 2,582 Building 11,390 11,390 Computer hardware and software 5,539 4,901 Office furniture and equipment 1,973 1,397 Tenant and leasehold improvements 8,082 4,477 Vehicle fleet 789 854 Total, at cost 30,355 25,601 Less: accumulated depreciation and amortization (9,482 ) (7,603 ) Property and equipment, net $ 20,873 $ 17,998 Depreciation and amortization expense for property and equipment was $649,000 and $1.0 million for the three months ended September 30, 2019 and 2018 and $1.9 million and $1.7 million for the nine months ended September 30, 2019 and 2018, respectively. The Company’s real estate consists of 15 acres of land and five buildings with a gross area of 229,000 square feet and a parking garage. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | NOTE 7. GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill and Intangible Assets At September 30, 2019 and December 31, 2018 goodwill was $152.5 million and intangible assets were $70.6 million and $76.9 million, respectively. The Company has determined the useful life of the other intangible assets to range between 2.5-15 years. The Company has recorded $1.3 million relating to insurance licenses and has classified the licenses as an indefinite lived intangible which is subject to annual impairment testing concurrent with goodwill. Goodwill (in thousands) Balance as of December 31, 2018 $ 152,459 Goodwill acquired — Impairment — Balance as of September 30, 2019 $ 152,459 Other Intangible Assets Our intangible assets resulted primarily from the acquisitions of Zephyr Acquisition Company in March 2016 and NBIC Holdings, Inc. in November 2017 and consist of brand, agent relationships, renewal rights, customer relations, trade names, non-competes and insurance licenses. Finite-lived intangibles assets are amortized over their useful lives from 2.5 to fifteen years. Amortization expense of our intangible assets was $2.1 million and $6.4 million for the three months ended September 30, 2019 and $6.3 million and $19.7 million for the nine months ended September 30, 2019 and 2018, respectively. No impairment in the value of amortizing or non-amortizing intangible assets was recognized during the three and nine months ended September 30, 2019 or 2018. Estimated annual pretax amortization of intangible assets for each of the next five years and thereafter is as follows (in thousands): Year Amount (1) 2019 remaining $ 1,927 2020 $ 6,365 2021 $ 6,351 2022 $ 6,351 2023 $ 6,351 2024 $ 6,351 Thereafter $ 35,558 Total $ 69,254 (1) Excludes insurance licenses valued at $1.3 million and classified as an indefinite lived intangible which is subject to annual impairment testing and not amortized. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | NOTE 8. EARNINGS PER SHARE The following table sets forth the computation of basic and diluted earnings per share (“EPS”) for the periods indicated. Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Basic earnings per share: Net income attributable to common stockholders (000's) $ 8,133 $ 5,989 $ 15,818 $ 23,227 Weighted average shares outstanding 29,109,962 25,631,871 29,329,742 25,663,415 Basic earnings per share: $ 0.28 $ 0.23 $ 0.54 $ 0.91 Diluted earnings per share: Net income attributable to common stockholders (000's) $ 8,133 $ 5,989 $ 15,818 $ 23,227 Weighted average shares outstanding 29,109,962 25,631,871 29,329,742 25,663,415 Weighted average dilutive shares 58,430 415,067 23,014 677,344 Total weighted average dilutive shares 29,168,392 26,046,938 29,352,756 26,340,759 Diluted earnings per share: $ 0.28 $ 0.23 $ 0.54 $ 0.88 |
Deferred Reinsurance Ceding Com
Deferred Reinsurance Ceding Commission | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Deferred Reinsurance Ceding Commission | NOTE 9. DEFERRED REINSURANCE CEDING COMMISSION The Company defers reinsurance ceding commission income, which is amortized over the effective period of the related insurance policies. For the quarter ended September 30, 2019 and 2018, the Company allocated ceding commission income of $11.3 million and $13.7 million to policy acquisition costs and $3.7 million and $4.5 million to general and administrative expense, respectively. For the nine months ended September 30, 2019 and 2018, the Company allocated ceding commission income of $36.8 million and $42.1 million to policy acquisition costs and $12 million and $13.8 million to general and administrative expense, respectively. The table below depicts the activity with regard to deferred reinsurance ceding commission during the three and nine months ended September 30, 2019 and 2018. Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) Beginning balance of deferred ceding commission income $ 34,705 $ 42,666 $ 44,996 $ 42,665 Ceding commission deferred 15,542 18,932 39,017 56,495 Less: ceding commission earned (15,062 ) (18,307 ) (48,828 ) (55,869 ) Ending balance of deferred ceding commission income $ 35,185 $ 43,291 $ 35,185 $ 43,291 |
Deferred Policy Acquisition Cos
Deferred Policy Acquisition Costs | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Deferred Policy Acquisition Costs | NOTE 10. DEFERRED POLICY ACQUISITION COSTS The Company defers certain costs in connection with written policies, called deferred policy acquisition costs (“DPAC”), which are amortized over the effective period of the related insurance policies. The Company anticipates that its DPAC costs will be fully recoverable in the near term. The table below depicts the activity with regard to DPAC during the three and nine months ended September 30, 2019 and 2018. Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) Beginning Balance $ 74,064 $ 69,648 $ 73,055 $ 41,678 Policy acquisition costs deferred 26,856 12,108 100,757 68,048 Amortization (25,307 ) (6,054 ) (98,199 ) (34,024 ) Ending Balance $ 75,613 $ 75,702 $ 75,613 $ 75,702 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 11. INCOME TAXES For the three months ended September 30, 2019 and 2018, the Company recorded $3.0 million and $3.0 million, respectively, of income tax expenses which corresponds to effective tax rates of 26.6% and 33.4%, respectively. Lower pre-tax income for the prior year quarter had an adverse impact on the effective tax rate due to the impact of permanent tax differences. During the nine months ended September 30, 2019 and 2018, the Company recorded $5.7 million and $9.1 million, respectively, of income tax expense which corresponds to an estimated annual effective tax rate of 26.4% and 28.1%, respectively. Effective tax rates are dependent upon components of pre-tax earnings and the related tax effects. The effective tax rate can fluctuate throughout the year as estimates used in the tax provision are updated as more information becomes available. The table below summarizes the significant components of our net deferred tax assets (liabilities): September 30, 2019 December 31, 2018 Deferred tax assets: (In thousands) Unearned premiums $ 10,752 $ 12,090 Unearned commission 8,426 10,733 Net operating loss 109 109 Tax-related discount on loss reserve 2,669 2,329 Unrealized loss — 2,631 Stock-based compensation 1,190 297 Accrued expenses 1,296 2,321 Other 2,466 1,443 Total deferred tax asset 26,908 31,953 Deferred tax liabilities: Deferred acquisition costs 18,107 17,494 Prepaid expenses 192 112 Unrealized gains 2,936 — Property and equipment 304 664 Note discount 468 710 Basis in purchased investments 114 163 Basis in purchased intangibles 17,564 18,982 Other 1,501 1,533 Total deferred tax liabilities 41,186 39,658 Net deferred tax liability $ (14,278 ) $ (7,705 ) In April 2019, the Company was notified by the tax authority that the federal income tax returns for the years 2015, 2016 and 2017 will be examined. The Company does not believe the examination results will have an adverse impact on the condensed consolidated financial statements. At September 30, 2019 and December 31, 2018, we had no significant uncertain tax positions or unrecognized tax benefits that, if recognized, would impact the effective income tax rate. |
Reinsurance
Reinsurance | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Reinsurance | NOTE 12. REINSURANCE Overview The Company’s reinsurance program is designed, utilizing the Company’s risk management methodology, to address its exposure to catastrophes or large non-catastrophic losses. The Company’s program provides reinsurance protection for catastrophes including hurricanes, tropical storms, tornadoes and winter storms. The Company’s reinsurance agreements are part of its catastrophe management strategy, which is intended to provide its stockholders an acceptable return on the risks assumed in its property business, and to reduce variability of earnings, while providing protection to the Company’s policyholders. In order to limit our potential exposure to catastrophic events, we purchase significant reinsurance from third party reinsurers and sponsor catastrophe bonds issued by Citrus Re Ltd. The catastrophe reinsurance may be on an excess of loss or quota share basis. We also purchase reinsurance for non-catastrophe losses on a quota share, per risk or facultative basis. Purchasing a sufficient amount of reinsurance to consider catastrophic losses from single or multiple events or significant non-catastrophe losses is an important part of our risk strategy, and premiums paid (or ceded) to reinsurers is one of our largest cost components. Reinsurance involves transferring, or “ceding”, a portion of the risk exposure on policies we write to another insurer, known as a reinsurer. To the extent that our reinsurers are unable to meet the obligations they assume under our reinsurance agreements, we remain liable for the entire insured loss. Our reinsurance agreements are prospective contracts. We record an asset, prepaid reinsurance premiums, and a liability, reinsurance payable, for the entire contract amount upon commencement of our new reinsurance agreements. We generally amortize our catastrophe reinsurance premiums over the 12-month contract period on a straight-line basis, which is June 1 through May 31. Our quota share reinsurance is amortized over the 12-month contract period and may be purchased on a calendar or fiscal year basis. In the event that we incur losses and loss adjustment expenses recoverable under our reinsurance program, we record amounts recoverable from our reinsurers on paid losses plus an estimate of amounts recoverable on unpaid losses. The estimate of amounts recoverable on unpaid losses is a function of our liability for unpaid losses associated with the reinsured policies; therefore, the amount changes in conjunction with any changes to our estimate of unpaid losses. As a result, a reasonable possibility exists that an estimated recovery may change significantly in the near term from the amounts included in our condensed consolidated financial statements. Our insurance regulators require all insurance companies, like us, to have a certain amount of capital and reinsurance coverage in order to cover losses and loss adjustment expenses upon the occurrence of a catastrophic event. Our reinsurance program provides reinsurance in excess of our state regulator requirements, which are based on the probable maximum loss that we would incur from an individual catastrophic event estimated to occur once in every 100 years based on our portfolio of insured risks. The nature, severity and location of the event giving rise to such a probable maximum loss differs for each insurer depending on the insurer’s portfolio of insured risks, including, among other things, the geographic concentration of insured value within such portfolio. As a result, a particular catastrophic event could be a one-in-100-year loss event for one insurance company while having a greater or lesser probability of occurrence for another insurance company. We also purchase reinsurance coverage to protect against the potential for multiple catastrophic events occurring in the same year. We share portions of our reinsurance program coverage among our insurance company affiliates. Significant Reinsurance Contracts 2019-2020 Excess of Loss Reinsurance Programs Catastrophe Excess of Loss Reinsurance Effective June 1, 2019, we entered into catastrophe excess of loss reinsurance agreements covering Heritage Property & Casualty Insurance Company (“Heritage P&C”), Zephyr Insurance Company (“Zephyr”) and Narragansett Bay Insurance Company (“NBIC”). The catastrophe reinsurance programs are allocated amongst traditional reinsurers, catastrophe bonds issued by Citrus Re Ltd., a Bermuda special purpose insurer formed in 2014 (“Citrus Re”), the Florida Hurricane Catastrophe Fund (“FHCF”) and Osprey Re Ltd, our captive reinsurer. The FHCF covers Florida risks only and we participate at 90%. Our third-party reinsurers are either rated “A-” or higher by A.M. Best or S&P or are fully collateralized, to reduce credit risk. The reinsurance program, which is segmented into layers of coverage, protects the Company for excess property catastrophe losses and loss adjustment expenses. The 2019-2020 reinsurance program provides first event coverage up to $1.5 billion for Heritage P&C, first event coverage up to $708.0 million for Zephyr, and first event coverage up to $936.0 million for NBIC. Our first event retention for each insurance company subsidiary follows: Heritage P&C - $20.0 million; Zephyr - $20.0 million; NBIC – $13.8 million. Our program was placed on a cascading basis which provides greater horizontal protection in a multiple small events scenario and features additional coverage enhancements. This coverage exceeds the requirements established by the ratings agency of our insurance company affiliates, Demotech, Inc., the Florida Office of Insurance Regulation, the Hawaii Insurance Division, and the Rhode Island Department of Business Regulation. We are responsible for all losses and loss adjustment expenses in excess of our reinsurance program. For second or subsequent catastrophic events, our total available coverage depends on the magnitude of the first event, as we may have coverage remaining from layers that were not previously fully exhausted. An aggregate of $2.6 billion of limit purchased in 2019 includes reinstatement through the purchase of reinstatement premium protection. In total, we have purchased $2.6 billion of potential reinsurance coverage, including our retention, for multiple catastrophic events. Our ability to access this coverage, however, will be subject to the severity and frequency of such events. The Company's estimated net cost for the 2019-2020 catastrophe reinsurance programs is approximately $249.2 million. Gross Quota Share Reinsurance NBIC did not enter into a gross quota share reinsurance program for its fiscal year beginning June 1, 2019. For its previous fiscal year, NBIC purchased an 8% gross quota share reinsurance treaty effective June 1, 2018 which provided ground up loss recoveries of up to $1.0 billion. Net Quota Share Reinsurance NBIC’s Net Quota Share coverage is proportional reinsurance for which certain of our other reinsurance inures to the quota share (property catastrophe excess of loss and reinstatement premium protection and the second layer of the general excess of loss). An occurrence limit of $20.0 million for catastrophe losses is in effect on the quota share, subject to certain aggregate loss limits that vary by reinsurer. The amount and rate of reinsurance commissions slide, within a prescribed minimum and maximum, depending on loss performance. The Net Quota Share program was renewed on December 31, 2018 ceding 52% of the net premiums and losses and 10% of the prior year quota share will run off. Aggregate Coverage A $931.0 million of limit is structured on an aggregate basis (Top and Aggregate, Layer 1, Layer 2, Layer 3, Layer 4, Layer 5, Stub layers, Multi-Zonal and 2017-1 Notes). To the extent that this coverage is not fully exhausted in the first catastrophic event, it provides coverage commencing at its reduced retention for second and subsequent events where underlying coverage has been previously exhausted. The Company purchased reinstatement premium protection for $627.0 million of this coverage, which can be reinstated one time. Layers (with exception to FHCF) are “net” of a $40.0 million attachment point. Layers inure to the subsequent layers if the aggregate limit of the preceding layer(s) is exhausted, and the subsequent layer cascades down in its place. NBIC placed 40% of an aggregate contract, which covers all catastrophe losses excluding named storms, on December 31, 2018, expiring May 31, 2019. The limit on the contract is $20.0 million, with a retention of $20.0 million and franchise deductible of $1.0 million. NBIC placed 100% of an occurrence contract, which covers all catastrophe losses excluding named storms, on December 31, 2018, expiring December 31, 2019. The limit on the contract is $20.0 million with a retention of $20.0 million and has one reinstatement available. Per Risk Coverage For southeast losses and northeast commercial residential losses, excluding losses from named storms, the Company purchased property per risk coverage for losses and loss adjustment expenses in excess of $1.0 million per claim. The limit recovered for an individual loss is $9.0 million and total limit for all losses is $27.0 million. There are two reinstatements available with additional premium due based on the amount of the layer exhausted. For Northeast commercial residential losses only, the Company purchased property per risk coverage for losses and loss adjustments expenses in excess of $750,000 per claim. The limit recovered for an individual loss is $250,000 and total limit for all losses is $750,000. There are two reinstatements available with additional premium due based on the amount of the layer exhausted. In addition, the Company purchased facultative reinsurance for losses in excess of $10.0 million for any properties it insured where the total insured value exceeded $10.0 million. This coverage applies to Southeast losses and Northeast commercial residential losses, excluding losses from named storms. General Excess of Loss NBIC’s general excess of loss reinsurance protects NBIC from single risk losses, both property and casualty. The casualty coverage provided by this reinsurance contract also responds on a “Clash” basis, meaning that multiple policies involved in a single loss occurrence can be aggregated into one loss and applied to the reinsurance contract. The coverage is in two layers in excess of NBIC’s retention of the first $400,000 of loss. The first layer is $350,000 excess $400,000 and the second layer is $2.75 million excess $750,000 (Casualty second layer is $1.25 million excess $750,000). Both layers are 100% placed. Semi-Automatic Facultative Excess of Loss NBIC’s automatic property facultative reinsurance protects NBIC from single risk losses, for property risks with a total insured value excess of $3.5 million subject to a limit. 2018 – 2019 Reinsurance Program Catastrophe Excess of Loss Reinsurance Effective June 1, 2018, we entered into catastrophe excess of loss reinsurance agreements covering Heritage P&C, Zephyr and NBIC. The catastrophe reinsurance programs are allocated amongst traditional reinsurers, catastrophe bonds issued by Citrus Re and FHCF. The FHCF covers Florida risks only and we participate at 45%. Citrus Re, which provides fully collateralized multi-year coverage, covers catastrophe losses incurred by Heritage P&C only through the 2016 Class D and 2017-1 Notes, and covers catastrophe losses incurred by Heritage P&C, Zephyr and NBIC through the 2016 Class E Note. Our third-party reinsurers are either rated “A-” or higher by A.M. Best or S&P or are fully collateralized, to reduce credit risk. The reinsurance program, which is segmented into layers of coverage, protects the Company for excess property catastrophe losses and loss adjustment expenses. The 2018-2019 reinsurance program provides first event coverage up to $1.6 billion for Heritage P&C, first event coverage up to $801.0 million for Zephyr, and first event coverage up to $1.0 billion for NBIC. Our first event retention for each insurance company subsidiary follows: Heritage P&C - $20.0 million; Zephyr - $20.0 million; NBIC – $12.8 million. Our second and third event retentions for each insurance company subsidiary follows: Heritage P&C - $16.0 million; Zephyr - $16.0 million; NBIC – $8.8 million. Our program was placed on a cascading basis which provides greater horizontal protection in a multiple small events scenario and features additional coverage enhancements. This coverage exceeds the requirements established by the Companies’ rating agency, Demotech, Inc., the Florida Office of Insurance Regulation, the Hawaii Insurance Division, and the Rhode Island Department of Business Regulation. For the twelve months ending May 31, 2019, no single uncollateralized private reinsurer represented more than 10% of the overall limit purchased from our total reinsurance coverage. We are responsible for all losses and loss adjustment expenses in excess of our reinsurance program. For second or subsequent catastrophic events, our total available coverage depends on the magnitude of the first event, as we may have coverage remaining from layers that were not previously fully exhausted. An aggregate of $3.4 billion of limit purchased in 2018 includes reinstatement through the purchase of reinstatement premium protection. In total, we have purchased $3.5 billion of potential reinsurance coverage, including our retention, for multiple catastrophic events. Our ability to access this coverage, however, will be subject to the severity and frequency of such events. The Company's estimated net cost for the 2018-2019 catastrophe reinsurance programs is approximately $252.0 million. Gross Quota Share Reinsurance NBIC purchased an 8% gross quota share reinsurance treaty effective June 1, 2018 which provides ground up loss recoveries of up to $1.0 billion. Prior to this treaty, NBIC’s gross quota share treaty was 18.75%. Net Quota Share Reinsurance NBIC’s Net Quota Share coverage is proportional reinsurance for which certain of our other reinsurance inures to the quota share (property catastrophe excess of loss and reinstatement premium protection and the second layer of the general excess of loss). An occurrence limit of $20.0 million for catastrophe losses is in effect on the quota share, subject to certain aggregate loss limits that vary by reinsurer. The amount and rate of reinsurance commissions slide, within a prescribed minimum and maximum, depending on loss performance. NBIC ceded 49.5% of net premiums and losses during 2018 to the Net Quota Share and 8% of the 2017 Net Quota Share was in runoff. The Net Quota Share program was renewed on December 31, 2018 ceding 52% of the net premiums and losses and 10% of the prior year quota share will run off. Aggregate Coverage A $1.1 billion of limit is structured on an aggregate basis (Top and Aggregate, Layer 1, Layer 2, Layer 3, Layer 4, Stub layers, Multi-Zonal, 2017-1 Notes and 2016 Class E Notes). To the extent that this coverage is not fully exhausted in the first catastrophic event, it provides coverage commencing at its reduced retention for second and subsequent events where underlying coverage has been previously exhausted. The Company purchased reinstatement premium protection for $669.0 million of this coverage, which can be reinstated one time. Layers (with exception to FHCF and 2016 Class D Notes) are “net” of a $40.0 million attachment point. Layers inure to the subsequent layers if the aggregate limit of the preceding layer(s) is exhausted, and the subsequent layer cascades down in its place. NBIC placed 42.5% of an aggregate contract, which covers all catastrophe losses excluding named storms, on May 31, 2018, expiring December 31, 2018. The limit on the contract is $20.0 million, with a retention of $3.0 million and franchise deductible of $1.5 million. NBIC placed 92% of an occurrence contract, which covers all catastrophe losses excluding named storms, on May 31, 2018, expiring December 31, 2018. The limit on the contract is $20.0 million with a retention of $20.0 million. NBIC placed 40% of an aggregate contract, which covers all catastrophe losses excluding named storms, on December 31, 2018, expiring May 31, 2019. The limit on the contract is $20.0 million, with a retention of $20.0 million and franchise deductible of $1.0 million. NBIC placed 100% of an occurrence contract, which covers all catastrophe losses excluding named storms, on December 31, 2018, expiring December 31, 2019. The limit on the contract is $20.0 million with a retention of $20.0 million and has one reinstatement available. Per Risk Coverage For southeast losses and northeast commercial residential losses, excluding losses from named storms, the Company purchased property per risk coverage for losses and loss adjustment expenses in excess of $1.0 million per claim. The limit recovered for an individual loss is $9.0 million and total limit for all losses is $27.0 million. There are two reinstatements available with additional premium due based on the amount of the layer exhausted. In addition, the Company purchased facultative reinsurance in excess of $10.0 million for any properties it insured where the total insured value exceeded $10.0 million. This coverage applied to Southeast losses and Northeast commercial residential losses, excluding losses from name storms. General Excess of Loss NBIC’s general excess of loss reinsurance protects NBIC from single risk losses, both property and casualty. The casualty coverage provided by this contract also responds on a “Clash” basis, meaning that multiple policies involved in a single loss occurrence can be aggregated into one loss and applied to the reinsurance contract. The coverage is in two layers in excess of NBIC’s retention of the first $300,000 of loss. The first layer is $450,000 excess $300,000 and the second layer is $2.75 million excess $750,000 (Casualty second layer is $1.25 million excess $750,000). Both layers are 92% placed with the gross quota share providing the additional 8% coverage. Semi-Automatic Facultative Excess of Loss NBIC’s automatic property facultative reinsurance protects NBIC from single risk losses, for property risks with a total insured value excess of $3.5 million subject to a limit. The Company’s reinsurance arrangements had the following effect on certain items in the condensed consolidated statement of income for the three and nine months ended September 30, 2019 and 2018: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) (In thousands) Premium written: Direct $ 237,303 $ 233,613 $ 702,491 $ 701,643 Ceded (46,858 ) (102,651 ) (406,300 ) (411,634 ) Net $ 190,445 $ 130,962 $ 296,191 $ 290,009 Premiums earned: Direct $ 231,617 $ 234,164 $ 690,165 $ 692,298 Ceded (107,755 ) (115,926 ) (342,529 ) (356,748 ) Net $ 123,862 $ 118,238 $ 347,636 $ 335,550 Loss and Loss Adjustment Expenses Direct $ 108,788 $ 145,753 $ 383,354 $ 697,743 Ceded (38,736 ) (87,058 ) (176,864 ) (519,968 ) Net $ 70,052 $ 58,695 $ 206,490 $ 177,775 |
Reserve For Unpaid Losses
Reserve For Unpaid Losses | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Reserve for Unpaid Losses | NOTE 13. RESERVE FOR UNPAID LOSSES The Company determines the reserve for unpaid losses on an individual-case basis for all incidents reported. The liability also includes amounts which are commonly referred to as incurred but not reported, or “IBNR”, claims as of the balance sheet date. The table below summarizes the activity related to the Company’s reserve for unpaid losses: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) Balance, beginning of period $ 430,413 $ 488,610 $ 432,359 $ 470,083 Less: reinsurance recoverable on unpaid losses 223,023 315,308 250,506 315,353 Net balance, beginning of period 207,390 173,302 181,853 154,730 Incurred related to: Current year 73,448 61,900 208,796 163,115 Prior years (396 ) (3,205 ) (2,306 ) 14,660 Total incurred 73,052 58,695 206,490 177,775 Paid related to: Current year 53,920 19,544 94,075 41,361 Prior years 17,820 17,585 85,566 96,276 Total paid 71,740 37,129 179,641 137,637 Net balance, end of period 208,702 194,868 208,702 194,868 Plus: reinsurance recoverable on unpaid losses 208,884 226,227 208,884 226,227 Balance, end of period $ 417,586 $ 421,095 $ 417,586 $ 421,095 As of September 30, 2019, the Company reported $208.7 million in unpaid losses and loss adjustment expenses, net of reinsurance which included $158.2 million attributable to IBNR net of reinsurance recoverable, or 75.8% of net reserves for unpaid losses and loss adjustment expenses. The Company’s losses incurred for the third quarter ended September 30, 2019 and 2018 reflect favorable development of $0.4 million and $3.2 million, respectively, associated with management’s best estimate of the actuarial loss and LAE reserves with consideration given to Company specific historical loss experience. While a portion of the 2018 development includes additional retention for hurricane losses, the majority of the 2018 loss development related to personal lines litigated and assignment of benefit claims from 2016 and 2017 accident years. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Convertible Senior Notes In August 2017 and September 2017, the Company issued in aggregate $136.8 million of 5.875% Convertible Senior Notes (“Convertible Notes”) maturing on August 1, 2037, unless earlier repurchased, redeemed or converted. Interest is payable semi-annually in arrears, on February 1, and August 1 of each year, commencing in 2018. As of September 30, 2019, the Company had $21.1 million of the Convertible Notes outstanding, net of issuance and debt discount costs in aggregate of approximately, $2.3 million. For nine months ended 2019 and 2018, the Company made interest payments of approximately $1.5 million and $7.7 million, respectively on the Convertible Notes. Debt Extinguishment On February 19, 2019, the Company reacquired $5.8 million of its outstanding Convertible Notes for approximately $2.9 million, which was paid in cash and the issuance of 285,201 shares of the Company’s common stock valued at $4.2 million. The repurchase resulted in a $48,000 non-operating loss. Senior Secured Credit Facility In December 2018, the Company entered into a five-year, $125.0 million credit agreement (the “Credit Agreement”) with a syndicate of lenders consisting of $75.0 million senior secured term loan facility (the “Term Loan Facility”) and a $50.0 million senior secured revolving credit facility (the “Revolving Credit Facility” and together with the Term Loan Facility, the “Credit Facilities”). Term Loan Facility: The principal amount of the Term Loan Facility amortizes in quarterly installments, beginning with the close of the fiscal quarter ending March 31, 2019, in an amount equal to $1.9 million per quarter, with the remaining balance payable at maturity. As of December 31, 2018, there was $75.0 million in aggregate principal outstanding on the Term Loan Facility. As of September 30, 2019, the balance of the term loan was $71.3 million. For the nine months ended September 30, 2019, the Company made interest payments of approximately $2.3 million on the term loan. Revolving Credit Facility : The Revolving Credit Facility allows for borrowings of up to $50.0 million inclusive of a $5.0 million sublimit for the issuance of letters of credit and a $10.0 million sublimit for swingline loans. As of December 31, 2018, there was $20.0 million in aggregate principal outstanding under the Revolving Credit Facility. As of September 30, 2019, the Company had $10.0 million of borrowings and no letters of credit outstanding under the Revolving Credit Facility. For the nine months ended September 30, 2019, the Company made interest payments of approximately $421,000 under the credit facility, respectively. At September 30, 2019, the Company’s effective interest rate for the Term Loan Facility was 5.625% and 5.3125% for the Revolving Credit Facility. The Company monitors the rates prior to the reset date which allows it to establish if the payment is monthly or quarterly payment based on the most beneficial rate used to calculate the interest payment. Mortgage Loan In October 2017, the Company and its subsidiary, Skye Lane Properties LLC, jointly obtained a commercial real estate mortgage loan in the amount of $12.7 million, bearing interest of 4.95% per annum and maturing on October 30, 2027. On October 30, 2022, the interest rate shall adjust to an interest rate equal to the annualized interest rate of the United States 5-year Treasury Notes as reported by Federal Reserve on a weekly average basis plus 3.10%. The Company makes monthly principal and interest payments against the loan. For each of the respective nine-month periods ended September 30, 2019 and 2018, the Company made principal and interest payments of approximately $670,000 on the mortgage loan. FHLB Loan Agreements In December 2018, a subsidiary of the Company received a fixed interest rate 3.094% cash loan of $19.2 million from the Federal Home Loan Bank (“FHLB”) Atlanta. In connection with the agreement, the subsidiary became a member of FHLB. Membership in the FHLB required an investment in FHLB’s common stock which was purchased in December 2018 and valued at $1.4 million. Additionally, the transaction required securities be pledged as collateral. As of September 30, 2019, the fair value of the collateralized securities was $24.5 million and the equity investment in FHLB common stock was $1.4 million. As of September 30, 2019, the Company made quarterly interest payments of approximately $452,000 per the terms of the agreement. The Company has also purchased common stock from FHLB Des Moines, and FHLB Boston valued at $140,200 and $76,600, respectively. The following table summarizes the Company’s debt and credit facilities as of September 30, 2019 and December 31, 2018: September 30, 2019 December 31, 2018 (in thousands) Convertible debt $ 23,413 $ 29,163 Mortgage loan 12,188 12,394 Term loan facility 71,250 75,000 Revolving credit facility 10,000 20,000 FHLB loan agreement 19,200 19,200 Total principal amount $ 136,051 $ 155,757 Less: unamortized discount and issuance costs $ 5,202 $ 6,963 Total long-term debt $ 130,849 $ 148,794 As of the date of this report, we were in compliance with the applicable terms of all our covenants and other requirements under the Revolving agreement, Term Note, Convertible Debt, cash borrowings and other loans. Our ability to secure future debt financing depends, in part, on our ability to remain in such compliance. As long as there is no default or an event of default exist, we are allowed to payout dividends in an aggregate amount not to exceed $10.0 million in any fiscal year. The schedule of principal payments on long-term debt is as follows: Year Amount (In thousands) 2019 remaining $ 3,821 2020 7,790 2021 7,806 2022 7,822 2023 74,589 Thereafter 34,223 Total $ 136,051 |
Accounts Payable and Other Liab
Accounts Payable and Other Liabilities | 9 Months Ended |
Sep. 30, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Accounts Payable and Other Liabilities | NOTE 15. ACCOUNTS PAYABLE AND OTHER LIABILITIES Accounts payable and other liabilities consist of the following as of September 30, 2019 and December 31, 2018: Description September 30, 2019 December 31, 2018 (In thousands) Deferred ceding commission $ 35,185 $ 44,996 Outstanding claim checks — 15,360 Accounts payable and other payables 7,096 8,379 Lease obligations 8,635 — Accrued interest and issuance costs 1,476 1,285 Accrued dividends 1,772 1,589 Premium tax — 2,241 Other liabilities 37 460 Commission payables 12,228 11,654 Total other liabilities $ 66,428 $ 85,964 |
Statutory Accounting and Regula
Statutory Accounting and Regulations | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Statutory Accounting and Regulations | NOTE 16. STATUTORY ACCOUNTING AND REGULATIONS State laws and regulations, as well as national regulatory agency requirements, govern the operations of all insurers such as our insurance subsidiaries. The various laws and regulations require that insurers maintain minimum amounts of statutory surplus and risk-based capital, restrict insurers’ ability to pay dividends, restrict the allowable investment types and investment mixes, and subject the Company’s insurers to assessments. The Company’s insurance subsidiaries must maintain capital and surplus ratios or balances as determined by the regulatory authority of the states in which they are domiciled. Heritage P&C is required to maintain capital and surplus equal to the greater of $15 million or 10% of their respective liabilities. Zephyr is required to maintain a deposit of $750,000 in a federally insured financial institution. NBIC is required to maintain capital and surplus of $3.0 million. The combined statutory surplus for Heritage P&C, Zephyr and NBIC was $337.3 million at September 30, 2019. The combined statutory surplus for Heritage P&C, Zephyr and NBIC was $376.3 million at December 31, 2018. State law also requires the Company’s insurance subsidiaries to adhere to prescribed premium-to-capital surplus ratios, with which the Company is in compliance. At September 30, 2019, our insurance subsidiaries met the financial and regulatory requirements of the states in which they do business. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 17. COMMITMENTS AND CONTINGENCIES The Company is involved in claims-related legal actions arising in the ordinary course of business. The Company accrues amounts resulting from claims-related legal actions in unpaid losses and loss adjustment expenses during the period that it determines an unfavorable outcome becomes probable and it can estimate the amounts. Management makes revisions to its estimates based on its analysis of subsequent information that the Company receives regarding various factors, including: (i) per claim information; (ii) company and industry historical loss experience; (iii) judicial decisions and legal developments in the awarding of damages; and (iv) trends in general economic conditions, including the effects of inflation. When determinable, the Company discloses the range of possible losses in excess of those accrued and for reasonably possible losses. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 18. RELATED PARTY TRANSACTIONS The Company has been party to various related party transactions involving certain of its officers, directors and significant stockholders as set forth below. The Company has entered into each of these arrangements without obligation to continue its effect in the future and the associated expense was immaterial to its results of operations or financial position as of September 30, 2019 and 2018. • In January 2017, the Company entered into a consulting agreement with Mrs. Shannon Lucas, the wife of the Chairman and CEO, in which she agreed to provide consulting services related to the Company’s catastrophe reinsurance and risk management program at a rate of $400 per hour. The consulting agreement has no specific term and either party may terminate the agreement upon providing written notice. Additionally, she serves as a director of Heritage P&C with an annual compensation of $150,000. For the nine months ended September 30, 2019 and 2018, the Company paid consulting fees to Ms. Lucas of approximately $256,000 and $575,000, respectively. • In July 2019, the Board of Directors appointed Mark Berset to the Board of Directors of the Company. Mr. Berset will be entitled to an annual compensation of $150,000. Mr. Berset is also the Chief Executive Officer of Comegys Insurance Agency, Inc. (“Comegys”), an independent insurance agency that writes policies for Company. The Company pays commission to Comegys based upon standard industry rates consistent with those provided to the Company’s other insurance agencies. There are no arrangements or understandings between Mr. Berset and any other persons with respect to his appointment as a director. For the nine months ended September 30, 2019 and 2018, the Company paid agency commission to Comegy of approximately $557,700 and $375,550, respectively. |
Employee Benefit Plans
Employee Benefit Plans | 9 Months Ended |
Sep. 30, 2019 | |
Compensation And Retirement Disclosure [Abstract] | |
Employee Benefit Plans | NOTE 19. EMPLOYEE BENEFIT PLANS The Company provides a 401(k) plan for substantially all employees. The Company provides a matching contribution of 100% on the first 3% of employees’ contribution and 50% on the next 2% of the employees’ contribution to the plan. The maximum match is 4%. For the three and nine months ended September 30, 2019 and 2018, the contributions made to the plan on behalf of the participating employees were approximately $213,000 and $756,000, and $215,000 and $973,000, respectively. The Company provides for its employees a partially self-insured healthcare plan and benefits. For the three and nine months ended September 30, 2019 and 2018, incurred medical premium costs amounted to an aggregate of $611,000 and $2.4 million and $1.0 million and $2.3 million, respectively. An additional liability of approximately $391,000 is recorded for unpaid claims as of September 30, 2019. A stop loss reinsurance policy caps the maximum loss that could be incurred by the Company under the self-insured plan. The Company’s stop loss coverage per employee is $150,000 for which any excess cost would be covered by the reinsurer subject to an aggregate limit for losses in excess of $1.5 million which would provide up to $1.0 million of coverage. Any excess of the $1.5 million retention and the $1 million of aggregate coverage would be borne by the Company. The aggregate stop loss commences once our expenses exceed 125% of the annual aggregate expected claims. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Equity | NOTE 20. EQUITY The total amount of authorized capital stock consists of 50,000,000 shares of common stock and 5,000,000 shares of preferred stock. As of September 30, 2019, the Company had 28,963,841 shares of common stock outstanding, 8,036,560 treasury shares of common stock and 570,534 unvested shares of restricted common stock issued reflecting total paid-in capital of $331.6 million as of such date. As more fully disclosed in our audited consolidated financial statements for the year ended December 31, 2018, there were, as of December 31, 2018, 29,477,756 shares of common stock outstanding, 7,214,797 treasury shares of common stock and 605,801 unvested shares of restricted common stock, representing $325.3 million of additional paid-in capital. Common Stock Holders of common stock are entitled to one vote for each share held on all matters subject to a vote of stockholders, subject to the rights of holders of any outstanding preferred stock. Accordingly, holders of a majority of the shares of common stock entitled to vote in any election of directors may elect all of the directors standing for election, subject to the rights of holders of any outstanding preferred stock. Holders of common stock will be entitled to receive ratably any dividends that the board of directors may declare out of funds legally available therefor, subject to any preferential dividend rights of outstanding preferred stock. Upon the Company’s liquidation, dissolution or winding up, the holders of common stock will be entitled to receive ratably its net assets available after the payment of all debts and other liabilities and subject to the prior rights of holders of any outstanding preferred stock. Holders of common stock have no preemptive, subscription, redemption or conversion rights. There are no redemption or sinking fund provisions applicable to the common stock. All outstanding shares of the Company’s capital stock are fully paid and nonassessable. Stock Repurchase Program On August 1, 2018, the Company announced that its Board of Directors authorized a stock repurchase program authorizing the Company to repurchase up to $50.0 million of its common stock through December 31, 2020 under our current Rule 10b5-1 trading plan, which allows the Company to purchase shares below a predetermined price per share. For the three months ended September 30, 2019, the Company purchased 316,383 shares of its common stock for $4.5 million. As of September 30, 2019, the Company repurchased in aggregate 821,763 shares of its common stock since authorizing the stock repurchase program for $11.9 million. At September 30, 2019, the Company has the capacity to repurchase $38.1 million of its common shares until December 2020. In addition, the Company acquired 4,620 shares and 12,620 shares for approximately $68,000 and $118,000 during three and nine months ended September 30, 2019, respectively, that were not part of the publicly announced share repurchase authorization. These shares consisted of shares retained to cover payroll withholding taxes in connection with the vesting of restricted stock awards Dividends On February 25, 2019, the Company’s Board of Directors declared a $0.06 per share quarterly dividend payable on April 3, 2019, to stockholders of record as of March 15, 2019. On May 6, 2019, the Company’s Board of Directors declared a $0.06 per share quarterly dividend payable on July 3, 2019 to stockholders of record as of June 14, 2019 On August 1, 2019, the Company’s Board of Directors declared a $0.06 per share quarterly dividend payable on October 3, 2019 to stockholders of record as of September 16, 2019. The declaration and payment of any future dividends will be subject to the discretion of the Board of Directors and will depend on a variety of factors including the Company’s financial condition and results of operations. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | NOTE 21. STOCK-BASED COMPENSATION Restricted Stock The Company has adopted the Heritage Insurance Holdings, Inc., Omnibus Incentive Plan (the “Plan”) effective on May 22, 2014. The Plan authorized 2,981,737 shares of common stock for issuance under the Plan for future grants. At September 30, 2019 there were 1,326,018 shares available for grant under the Plan. The Company recognizes compensation expense under ASC 718 for its stock-based payments based on the fair value of the awards. In 2018, the Company granted 155,801 restricted shares vesting over three to five years, to the Company’s executives and other key employees. No restricted stock was granted during the nine months ended September 30, 2019. The Plan authorizes the Company to grant stock options at exercise prices equal to the fair market value of the Company’s stock on the dates the options are granted. Any options granted would typically have a maximum term of ten years from the date of grant and vest primarily in equal annual installments over a range of one to five-year periods following the date of grant for employee options. If a participant’s employment relationship ends, the participant’s vested awards would remain exercisable for the shorter of a period of 30 days or the period ending on the latest date on which such award could have been exercisable. The fair value of each option grant is separately estimated for each grant date. The fair value of each option is amortized into compensation expense on a straight-line basis between the grant date for the award and each vesting date. The Company estimates the fair value of all stock option awards as of the date of the grant by applying the Black-Scholes-Merton multiple-option pricing valuation model. The application of this valuation model involves assumptions that are judgmental and highly sensitive in the determination of compensation expense. The Company has not granted any stock options since 2015 and all unexercised stock options have since been forfeited. The Company has also granted shares of its common stock subject to certain restrictions under the Plan. Restricted stock awards granted to employees vest in equal installments generally over a five-year period from the grant date subject to the recipient’s continued employment. The fair value of restricted stock awards is estimated by the market price at the date of grant and amortized on a straight-line basis to expense over the period of vesting. Recipients of restricted stock awards have the right to receive dividends. Restricted stock activity for the quarter ended September 30, 2019 is as follows: Weighted-Average Grant-Date Fair Number of shares Value per Share Non-vested, at December 31, 2018 605,801 $ 19.30 Granted — — Vested (22,647 ) 14.28 Canceled and surrendered (12,620 ) 14.24 Non-vested, at September 30, 2019 570,534 $ 19.61 Awards are being amortized to expense over the three to five-year vesting period. The Company recognized $4.0 million and $3.9 million of compensation expense for the nine months ended September 30, 2019 and 2018, respectively. There was approximately $6.9 million of unrecognized compensation expense related to the un-vested restricted stock at September 30, 2019. The Company expects to recognize substantially all of remaining compensation expense over the next 1.3 years. For the nine months ended September 30, 2019, 35,267 shares of restricted stock were vested and released, all of which had been granted to employees. Of the shares released to employees, 12,620 shares were withheld by the Company to cover withholding taxes of $186,000. For the comparable period of 2018, no shares were vested and released. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 22. SUBSEQUENT EVENTS The Company performed an evaluation of subsequent events through the date the condensed consolidated financial statements were issued and determined there were no recognized or unrecognized subsequent events that would require an adjustment or additional disclosure in the condensed consolidated financial statements as of September 30, 2019. On October 31, 2019, the Company announced that its Board of Directors declared a $0.06 per share quarterly dividend payable on January 3, 2020 to stockholders of record as of December 16, 2019. |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The condensed consolidated financial statements include the accounts of Heritage Insurance Holdings, Inc. (together with its subsidiaries, the “Company”). These statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain financial information that is normally included in annual consolidated financial statements prepared in accordance with GAAP, but that is not required for interim reporting purposes, has been omitted. In the opinion of the Company’s management, all material intercompany transactions and balances have been eliminated and all adjustments consisting of normal recurring accruals which are necessary for a fair statement of the financial condition and results of operations for the interim periods have been reflected. The accompanying interim condensed consolidated financial statements and related footnotes should be read in conjunction with the Company’s audited consolidated financial statements and related footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (the “ 2018 Form 10- K”). |
Leases | Leases At the inception of a contract, we assess whether the contract is, or contains, a lease. The assessment is based on (1) whether the contract involves the use of distinct identified assets, (2) whether the Company obtains the right to substantially all the economic benefit from the use of the asset throughout the period, and (3) whether the Company has the right to direct the use of the asset. All significant lease arrangements are generally recognized at lease commencement. A right of use (“ROU”) asset and corresponding lease liability are not recorded for leases with an initial term of 12 months or less (short term leases) and we recognize lease expense for these leases as incurred over the lease term. ROU assets represent our right to use an underlying asset during the reasonably certain lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Our lease terms include options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Operating lease ROU assets and liabilities are recognized based on the present value of lease payments not yet paid. Lease payments may be fixed or variable, however, only fixed payments or in-substance fixed payments are included in determining the lease liability. Variable lease payments are recognized in operating expenses in the period in which the obligation for those payments are incurred. The operating lease ROU asset also includes any lease payments related to initial direct cost and prepayments and excludes lease incentives. Lease expense is recognized on a straight-line basis over the term of the lease. We have lease agreements with lease and non-lease components, which are generally accounted for separately. We primarily use our incremental borrowing rates for our operating leases (rates are not readily determinable) and implicit rates for our financing leases in determining the present value of lease payments. In the first quarter of 2019, the Company adopted ASU 2016 -02 and did not recognize an opening adjustment to retained earnings as a result of the adoption of FASB 842. Refer to Note 5-Leases herein for further information. |
Reclassification | Reclassification Certain prior year amounts have been reclassified to conform to the current year presentation. |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases We adopted the guidance prospectively during the first quarter of 2019. As part of our adoption, we elected not to reassess historical lease classification or recognize short-term leases on our balance sheet. At implementation, we recorded approximately $2.8 million as right-of-use operating and financing We did not recognize an opening adjustment to retained earnings. Note 5 Accounting Pronouncements Not Yet Adopted In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments Financial Instruments-Overall Recognition and Measurement of Financial Assets and Financial Liabilities FASB ASU 2016-13 Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments The Company’s implementation activities, which remain in process, include the development of models, methodologies, data input and assumptions to be used in estimating expected credit losses. The implementation primarily impacts the Company’s debt securities and reinsurance recoverable balances. The adoption of this standard is not expected to be material to our financial position, results of operations or cash flows. For information regarding other accounting standards that the Company has not yet adopted, refer to our Annual Report on Form 10-K, filed on March 12, 2019, the section of Note 1 of the notes to the consolidated financial statements entitled the “Accounting Pronouncement Not Yet Adopted”. |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Investments Debt And Equity Securities [Abstract] | |
Schedule of Difference between Cost or Adjusted/Amortized Cost and Estimated Fair Value, by Major Investment Category | Securities Available-for-Sale The following table details the difference between cost or adjusted/amortized cost and estimated fair value, by major investment category, at September 30, 2019 and December 31, 2018: September 30, 2019 Cost or Adjusted / Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities, available-for-sale (In thousands) U.S. government and agency securities (1) $ 62,492 $ 521 $ 24 $ 62,989 States, municipalities and political subdivisions 79,141 2,090 20 81,211 Special revenue 264,897 4,782 160 269,519 Industrial and miscellaneous 198,291 4,118 44 202,365 Total $ 604,821 $ 11,511 $ 248 $ 616,084 December 31, 2018 Cost or Adjusted / Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities, available-for-sale (In thousands) U.S. government and agency securities (1) $ 48,739 $ 40 $ 738 $ 48,041 States, municipalities and political subdivisions 60,028 46 785 59,289 Special revenue 249,026 210 3,881 245,355 Industrial and miscellaneous 155,678 81 3,302 152,457 Redeemable preferred stocks 4,920 — 413 4,507 Total $ 518,391 $ 377 $ 9,119 $ 509,649 (1) U.S. government and agency securities include pledged fixed maturity securities with an estimated fair value of $24.5 million and $31.0 million under the terms and condition of the advance agreement entered into with a financial institution as of September 30, 2019 and December 31, 2018, respectively. The Company is permitted to withdraw or exchange any portion of the pledged collateral over the minimum requirement at any time. |
Schedule of Net Realized Gains (Losses) by Major Investment Category | The Company calculates the gain or loss realized on the sale of investments by comparing the sales price (fair value) to the cost or adjusted/amortized cost of the security sold. The Company determines the cost or adjusted/amortized cost of the security sold using the specific-identification method. The following tables detail the Company’s net realized gains (losses) by major investment category for the three and nine months ended September 30, 2019 and 2018. 2019 2018 Gains (Losses) Fair Value at Sale Gains (Losses) Fair Value at Sale Three Months Ended September 30, (In thousands) Fixed maturity securities $ 108 $ 43,255 $ — $ 15 Equity securities — — 1 173 Total realized gains 108 43,255 1 173 Fixed maturity securities — 2,317 — — Equity securities — — (8 ) 263 Total realized losses — 2,317 (8 ) 263 Net realized gains and (losses) $ 108 $ 45,572 $ (7 ) $ 436 2019 2018 Gains (Losses) Fair Value at Sale Gains (Losses) Fair Value at Sale Nine Months Ended September 30, (In thousands) Fixed maturity securities $ 958 $ 45,143 $ 78 $ 27,443 Equity securities 1,323 22,604 1 169 Total realized gains 2,281 67,747 79 27,612 Fixed maturity securities (76 ) 2,611 (237 ) 49,025 Equity securities (67 ) 2,374 (185 ) 4,193 Total realized losses (143 ) 4,985 (422 ) 53,218 Net realized gains and (losses) $ 2,138 $ 72,732 $ (343 ) $ 80,830 |
Schedule of Amortized Cost and Fair Value of Investment Securities by Contractual Maturity | The table below summarizes the Company’s fixed maturity securities at September 30, 2019 by contractual maturity periods. Actual results may differ as issuers may have the right to call or prepay obligations, with or without penalties, prior to the contractual maturity of those obligations. At September 30, 2019 Cost or Amortized Cost Percent of Total Fair Value Percent of Total Maturity dates: (In thousands) (In thousands) Due in one year or less $ 67,878 11 % $ 68,007 11 % Due after one year through five years 199,455 33 % 201,696 33 % Due after five years through ten years 139,435 23 % 144,386 23 % Due after ten years 198,053 33 % 201,995 33 % Total $ 604,821 100 % $ 616,084 100 % |
Summary of Net Investment Income | The following table summarizes the Company’s net investment income by major investment category for the three and nine months ended September 30, 2019 and 2018, respectively: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) Fixed maturity securities $ 3,492 $ 3,020 $ 10,625 $ 8,018 Equity securities 22 547 944 1,252 Cash and cash equivalents 558 284 1,288 861 Other investments 324 425 258 1,168 Net investment income 4,396 4,276 13,115 11,299 Less: Investment expenses 741 429 1,958 1,595 Net investment income, less investment expenses $ 3,655 $ 3,847 $ 11,157 $ 9,704 |
Aging of Gross Unrealized Losses on Fixed Maturity Investments | The following tables present an aging of our unrealized losses on fixed maturity investments by investment class as of September 30, 2019 and December 31, 2018: Less Than Twelve Months Twelve Months or More September 30, 2019 Number of Securities Gross Unrealized Losses Fair Value Number of Securities Gross Unrealized Losses Fair Value Fixed maturity securities, available-for-sale (In thousands) U.S. government and agency securities 4 2 $ 450 25 $ 22 $ 4,523 States, municipalities and political subdivisions 2 14 6,026 4 6 2,456 Industrial and miscellaneous 20 14 6,027 31 30 10,195 Special revenue 52 22 13,154 123 138 18,524 Total fixed maturity securities 78 $ 52 $ 25,657 183 $ 196 $ 35,698 Less Than Twelve Months Twelve Months or More December 31, 2018 Number of Securities Gross Unrealized Losses Fair Number of Securities Gross Unrealized Losses Fair Value Fixed maturity securities, available-for-sale (In thousands) U.S. government and agency securities 17 $ 129 $ 10,485 66 $ 609 $ 20,488 States, municipalities and political subdivisions 13 103 12,864 42 682 39,979 Industrial and miscellaneous 214 1,479 70,156 232 1,822 70,375 Special revenue 105 1,260 76,335 323 2,621 108,319 Redeemable preferred stocks 55 193 2,541 27 221 1,965 Total fixed maturity securities 404 $ 3,164 $ 172,381 690 $ 5,955 $ 241,126 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Financial Instruments | September 30, 2019 Total Level 1 Level 2 Level 3 Invested Assets: (In thousands) Fixed maturity securities, available-for-sale: U.S. government and agency securities $ 62,989 $ 366 $ 62,623 $ — States, municipalities and political subdivisions 81,211 — 81,211 — Special revenue 269,519 — 269,519 — Industrial and miscellaneous 202,365 — 202,365 — Total fixed maturity securities 616,084 366 615,718 — Investments reported at NAV (1) 28,990 — — — Total investments $ 645,074 $ 366 $ 615,718 $ — December 31, 2018 Total Level 1 Level 2 Level 3 Invested Assets: (In thousands) Fixed maturity securities, available-for-sale: U.S. government and agency securities $ 48,041 $ 354 $ 47,687 $ — States, municipalities and political subdivisions 59,289 — 59,289 — Special revenue 245,355 — 245,355 — Industrial and miscellaneous 152,457 — 152,457 — Redeemable preferred stocks 4,507 4,507 — — Total fixed maturity securities 509,649 4,861 504,788 — Equity securities Common stock 2,264 2,264 — — Non-redeemable preferred stock 12,770 12,770 — — Total equity securities 15,034 15,034 — — Investments reported at NAV (1) 3,910 — — — Total investments $ 528,593 $ 19,895 $ 504,788 $ — (1) Includes $1.6 million and $1.4 million of Federal Home Loan Banks membership shares held by the Company as of September 30, 2019 and December 31, 2018, respectively. |
Other Comprehensive Income (Tab
Other Comprehensive Income (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Comprehensive Income Net Of Tax [Abstract] | |
Effect on Other Comprehensive Income due to Changes in Unrealized Gains and Losses, Net of Tax on Available-for-sale Fixed Maturities Securities | The difference between net income as reported and comprehensive income was due to the changes in unrealized gains and losses, net of taxes on fixed maturities securities. For the Three Months Ended September 30, 2019 2018 Pre-tax Tax After-tax Pre-tax Tax After-tax (in thousands) Other comprehensive income Change in unrealized losses on investments, net $ 4,429 $ (1,060 ) $ 3,369 $ (2,895 ) $ 1,666 $ (1,229 ) Reclassification adjustment of realized losses (gains) included in net income (103 ) 25 (78 ) (5 ) (1 ) (6 ) Effect on other comprehensive income $ 4,326 $ (1,035 ) $ 3,291 $ (2,900 ) $ 1,665 $ (1,235 ) For the Nine Months Ended September 30, 2019 2018 Pre-tax Tax After-tax Pre-tax Tax After-tax (in thousands) Other comprehensive income Change in unrealized losses on investments, net $ 19,533 $ (4,677 ) $ 14,856 $ (9,918 ) $ 3,185 $ (6,733 ) Reclassification adjustment of realized losses (gains) included in net income 291 (70 ) 221 307 64 371 Effect on other comprehensive income $ 19,824 $ (4,747 ) $ 15,077 $ (9,611 ) $ 3,249 $ (6,362 ) |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Components of Lease Costs | Components of our lease costs for the three and nine months ended September 30, 2019 are as follows (in thousands): Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Amortization of ROU assets - Finance leases $ 19 $ 58 Interest on lease liabilities - Finance leases 6 17 Variable lease cost (cost excluded from lease payments) 113 337 Operating lease cost (cost resulting from lease payments) 331 918 Total lease cost $ 469 $ 1,330 |
Supplemental Cash Flow Information and Non-Cash Activity Related to Operating and Financing Leases | Supplemental cash flow information and non-cash activity related to our operating and financing leases as of September 30, 2019 are as follows (in thousands): Nine Months Ended September 30, 2019 Finance lease - Operating cash flows $ 20 Finance lease - Financing cash flows $ 66 Operating lease - Operating cash flows (fixed payments) $ 613 Operating lease - Operating cash flows (liability reduction) $ 465 |
Supplemental Balance Sheet Information Related to Operating and Financing Leases | Supplemental balance sheet information related to our operating and financing leases as of September 30, 2019 are as follows (in thousands): Balance Sheet Classification September 30, 2019 Right-of-use assets - operating Other assets $ 6,567 Right-of-use assets - finance Other assets $ 323 Lease Liability (1) Accounts payable and other liabilities $ (8,293 ) Lease Liability - finance Accounts payable and other liabilities $ (342 ) (1) Includes $1.3 million in lease incentives received in the first quarter of 2019. |
Weighted-Average Remaining Lease Term and Discount Rate for Operating and Financing Leases | Weighted-average remaining lease term and discount rate for our operating and financing leases as of September 30, 2019 are as follows: September 30, 2019 Weighted average lease term - Finance leases 3.91 yrs. Weighted average lease term - Operating leases 8.19 yrs. Weighted average discount rate - Finance leases 7.09 % Weighted average discount rate - Operating leases 5.32 % |
Maturities of Lease Liabilities by Fiscal Year for Operating and Financing Leases | Maturities of lease liabilities by fiscal year for our operating and financing leases as of September 30, 2019 are as follows (in thousands): September 30, 2019 2019 remaining $ 380 2020 1,442 2021 1,401 2022 1,425 2023 1,371 2024 and thereafter 4,695 Total lease payments 10,714 Less: imputed interest (2,079 ) Present value of lease liabilities $ 8,635 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property and Equipment, Net | Property and equipment, net consisted of the following at September 30, 2019 and December 31, 2018: September 30, 2019 December 31, 2018 (In thousands) Land $ 2,582 $ 2,582 Building 11,390 11,390 Computer hardware and software 5,539 4,901 Office furniture and equipment 1,973 1,397 Tenant and leasehold improvements 8,082 4,477 Vehicle fleet 789 854 Total, at cost 30,355 25,601 Less: accumulated depreciation and amortization (9,482 ) (7,603 ) Property and equipment, net $ 20,873 $ 17,998 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Goodwill (in thousands) Balance as of December 31, 2018 $ 152,459 Goodwill acquired — Impairment — Balance as of September 30, 2019 $ 152,459 |
Schedule of Estimated Amortization of Intangible Assets | Estimated annual pretax amortization of intangible assets for each of the next five years and thereafter is as follows (in thousands): Year Amount (1) 2019 remaining $ 1,927 2020 $ 6,365 2021 $ 6,351 2022 $ 6,351 2023 $ 6,351 2024 $ 6,351 Thereafter $ 35,558 Total $ 69,254 (1) Excludes insurance licenses valued at $1.3 million and classified as an indefinite lived intangible which is subject to annual impairment testing and not amortized. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings Per Share (EPS) | The following table sets forth the computation of basic and diluted earnings per share (“EPS”) for the periods indicated. Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Basic earnings per share: Net income attributable to common stockholders (000's) $ 8,133 $ 5,989 $ 15,818 $ 23,227 Weighted average shares outstanding 29,109,962 25,631,871 29,329,742 25,663,415 Basic earnings per share: $ 0.28 $ 0.23 $ 0.54 $ 0.91 Diluted earnings per share: Net income attributable to common stockholders (000's) $ 8,133 $ 5,989 $ 15,818 $ 23,227 Weighted average shares outstanding 29,109,962 25,631,871 29,329,742 25,663,415 Weighted average dilutive shares 58,430 415,067 23,014 677,344 Total weighted average dilutive shares 29,168,392 26,046,938 29,352,756 26,340,759 Diluted earnings per share: $ 0.28 $ 0.23 $ 0.54 $ 0.88 |
Deferred Reinsurance Ceding C_2
Deferred Reinsurance Ceding Commission (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Schedule of Activity with Regard to Deferred Reinsurance Ceding Commission | The table below depicts the activity with regard to deferred reinsurance ceding commission during the three and nine months ended September 30, 2019 and 2018. Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) Beginning balance of deferred ceding commission income $ 34,705 $ 42,666 $ 44,996 $ 42,665 Ceding commission deferred 15,542 18,932 39,017 56,495 Less: ceding commission earned (15,062 ) (18,307 ) (48,828 ) (55,869 ) Ending balance of deferred ceding commission income $ 35,185 $ 43,291 $ 35,185 $ 43,291 |
Deferred Policy Acquisition C_2
Deferred Policy Acquisition Costs (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Summary of Activity in Deferred Policy Acquisition Costs (DPAC) | The table below depicts the activity with regard to DPAC during the three and nine months ended September 30, 2019 and 2018. Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) Beginning Balance $ 74,064 $ 69,648 $ 73,055 $ 41,678 Policy acquisition costs deferred 26,856 12,108 100,757 68,048 Amortization (25,307 ) (6,054 ) (98,199 ) (34,024 ) Ending Balance $ 75,613 $ 75,702 $ 75,613 $ 75,702 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Components of Deferred Tax Assets (Liabilities) | The table below summarizes the significant components of our net deferred tax assets (liabilities): September 30, 2019 December 31, 2018 Deferred tax assets: (In thousands) Unearned premiums $ 10,752 $ 12,090 Unearned commission 8,426 10,733 Net operating loss 109 109 Tax-related discount on loss reserve 2,669 2,329 Unrealized loss — 2,631 Stock-based compensation 1,190 297 Accrued expenses 1,296 2,321 Other 2,466 1,443 Total deferred tax asset 26,908 31,953 Deferred tax liabilities: Deferred acquisition costs 18,107 17,494 Prepaid expenses 192 112 Unrealized gains 2,936 — Property and equipment 304 664 Note discount 468 710 Basis in purchased investments 114 163 Basis in purchased intangibles 17,564 18,982 Other 1,501 1,533 Total deferred tax liabilities 41,186 39,658 Net deferred tax liability $ (14,278 ) $ (7,705 ) |
Reinsurance (Tables)
Reinsurance (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Schedule of Effect of Reinsurance Arrangements in Consolidated Statement of Income | The Company’s reinsurance arrangements had the following effect on certain items in the condensed consolidated statement of income for the three and nine months ended September 30, 2019 and 2018: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) (In thousands) Premium written: Direct $ 237,303 $ 233,613 $ 702,491 $ 701,643 Ceded (46,858 ) (102,651 ) (406,300 ) (411,634 ) Net $ 190,445 $ 130,962 $ 296,191 $ 290,009 Premiums earned: Direct $ 231,617 $ 234,164 $ 690,165 $ 692,298 Ceded (107,755 ) (115,926 ) (342,529 ) (356,748 ) Net $ 123,862 $ 118,238 $ 347,636 $ 335,550 Loss and Loss Adjustment Expenses Direct $ 108,788 $ 145,753 $ 383,354 $ 697,743 Ceded (38,736 ) (87,058 ) (176,864 ) (519,968 ) Net $ 70,052 $ 58,695 $ 206,490 $ 177,775 |
Reserve for Unpaid Losses (Tabl
Reserve for Unpaid Losses (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Summary of Reserve for Unpaid Losses | The table below summarizes the activity related to the Company’s reserve for unpaid losses: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (In thousands) Balance, beginning of period $ 430,413 $ 488,610 $ 432,359 $ 470,083 Less: reinsurance recoverable on unpaid losses 223,023 315,308 250,506 315,353 Net balance, beginning of period 207,390 173,302 181,853 154,730 Incurred related to: Current year 73,448 61,900 208,796 163,115 Prior years (396 ) (3,205 ) (2,306 ) 14,660 Total incurred 73,052 58,695 206,490 177,775 Paid related to: Current year 53,920 19,544 94,075 41,361 Prior years 17,820 17,585 85,566 96,276 Total paid 71,740 37,129 179,641 137,637 Net balance, end of period 208,702 194,868 208,702 194,868 Plus: reinsurance recoverable on unpaid losses 208,884 226,227 208,884 226,227 Balance, end of period $ 417,586 $ 421,095 $ 417,586 $ 421,095 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Company's Debt and Credit Facilities | The following table summarizes the Company’s debt and credit facilities as of September 30, 2019 and December 31, 2018: September 30, 2019 December 31, 2018 (in thousands) Convertible debt $ 23,413 $ 29,163 Mortgage loan 12,188 12,394 Term loan facility 71,250 75,000 Revolving credit facility 10,000 20,000 FHLB loan agreement 19,200 19,200 Total principal amount $ 136,051 $ 155,757 Less: unamortized discount and issuance costs $ 5,202 $ 6,963 Total long-term debt $ 130,849 $ 148,794 |
Schedule of Principal Payments on Long-Term Debt | The schedule of principal payments on long-term debt is as follows: Year Amount (In thousands) 2019 remaining $ 3,821 2020 7,790 2021 7,806 2022 7,822 2023 74,589 Thereafter 34,223 Total $ 136,051 |
Accounts Payable and Other Li_2
Accounts Payable and Other Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Accounts Payable and Other Liabilities | Accounts payable and other liabilities consist of the following as of September 30, 2019 and December 31, 2018: Description September 30, 2019 December 31, 2018 (In thousands) Deferred ceding commission $ 35,185 $ 44,996 Outstanding claim checks — 15,360 Accounts payable and other payables 7,096 8,379 Lease obligations 8,635 — Accrued interest and issuance costs 1,476 1,285 Accrued dividends 1,772 1,589 Premium tax — 2,241 Other liabilities 37 460 Commission payables 12,228 11,654 Total other liabilities $ 66,428 $ 85,964 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Restricted Stock Activity | Weighted-Average Grant-Date Fair Number of shares Value per Share Non-vested, at December 31, 2018 605,801 $ 19.30 Granted — — Vested (22,647 ) 14.28 Canceled and surrendered (12,620 ) 14.24 Non-vested, at September 30, 2019 570,534 $ 19.61 |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies - Additional Information (Detail) $ in Millions | Mar. 31, 2019USD ($) |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Right-of-use assets | $ 2.8 |
Lease liabilities | $ 2.8 |
Investments - Schedule of Diffe
Investments - Schedule of Difference between Cost or Adjusted/Amortized Cost and Estimated Fair Value, by Major Investment Category (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Cost or Adjusted / Amortized Cost | $ 604,821 | $ 518,391 |
Fixed maturity securities, available-for-sale, Gross Unrealized Gains | 11,511 | 377 |
Fixed maturity securities, available-for-sale, Gross Unrealized Losses | 248 | 9,119 |
Fixed maturity securities, available-for-sale, Fair Value | 616,084 | 509,649 |
U.S. government and agency securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Cost or Adjusted / Amortized Cost | 62,492 | 48,739 |
Fixed maturity securities, available-for-sale, Gross Unrealized Gains | 521 | 40 |
Fixed maturity securities, available-for-sale, Gross Unrealized Losses | 24 | 738 |
Fixed maturity securities, available-for-sale, Fair Value | 62,989 | 48,041 |
States, Municipalities and Political Subdivisions [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Cost or Adjusted / Amortized Cost | 79,141 | 60,028 |
Fixed maturity securities, available-for-sale, Gross Unrealized Gains | 2,090 | 46 |
Fixed maturity securities, available-for-sale, Gross Unrealized Losses | 20 | 785 |
Fixed maturity securities, available-for-sale, Fair Value | 81,211 | 59,289 |
Special Revenue [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Cost or Adjusted / Amortized Cost | 264,897 | 249,026 |
Fixed maturity securities, available-for-sale, Gross Unrealized Gains | 4,782 | 210 |
Fixed maturity securities, available-for-sale, Gross Unrealized Losses | 160 | 3,881 |
Fixed maturity securities, available-for-sale, Fair Value | 269,519 | 245,355 |
Industrial and Miscellaneous [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Cost or Adjusted / Amortized Cost | 198,291 | 155,678 |
Fixed maturity securities, available-for-sale, Gross Unrealized Gains | 4,118 | 81 |
Fixed maturity securities, available-for-sale, Gross Unrealized Losses | 44 | 3,302 |
Fixed maturity securities, available-for-sale, Fair Value | $ 202,365 | 152,457 |
Redeemable Preferred Stocks [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Cost or Adjusted / Amortized Cost | 4,920 | |
Fixed maturity securities, available-for-sale, Gross Unrealized Losses | 413 | |
Fixed maturity securities, available-for-sale, Fair Value | $ 4,507 |
Investments - Schedule of Dif_2
Investments - Schedule of Difference between Cost or Adjusted/Amortized Cost and Estimated Fair Value, by Major Investment Category (Parenthetical) (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | $ 616,084 | $ 509,649 |
U.S. government and agency securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | 62,989 | 48,041 |
U.S. government and agency securities [Member] | Pledged securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | $ 24,500 | $ 31,000 |
Investments - Schedule of Net R
Investments - Schedule of Net Realized Gains (Losses) by Major Investment Category (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Schedule of Available-for-sale Securities [Line Items] | ||||
Total realized gains | $ 108 | $ 1 | $ 2,281 | $ 79 |
Total realized losses | (8) | (143) | (422) | |
Net realized gains and (losses) | 108 | (7) | 2,138 | (343) |
Total realized gains, Fair Value at Sale | 43,255 | 173 | 67,747 | 27,612 |
Total realized losses, Fair Value at Sale | 2,317 | 263 | 4,985 | 53,218 |
Net realized gain and (losses), Fair Value at Sale | 45,572 | 436 | 72,732 | 80,830 |
Fixed Maturity Securities [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Total realized gains | 108 | 958 | 78 | |
Total realized losses | (76) | (237) | ||
Total realized gains, Fair Value at Sale | 43,255 | 15 | 45,143 | 27,443 |
Total realized losses, Fair Value at Sale | $ 2,317 | 2,611 | 49,025 | |
Equity Securities [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Total realized gains | 1 | 1,323 | 1 | |
Total realized losses | (8) | (67) | (185) | |
Total realized gains, Fair Value at Sale | 173 | 22,604 | 169 | |
Total realized losses, Fair Value at Sale | $ 263 | $ 2,374 | $ 4,193 |
Investments - Additional Inform
Investments - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Investments [Line Items] | |||||
Other revenue | $ 3,377,000 | $ 3,333,000 | $ 10,878,000 | $ 11,273,000 | |
Net realized and unrealized gains (losses) | 805,000 | (123,000) | 3,132,000 | (1,234,000) | |
Proceeds from sale of marketable securities | 0 | 428,000 | 26,521,000 | 4,209,000 | |
Gross gain from sales of marketable securities | 7,900 | 2,400,000 | 1,100 | ||
Gross loss from sales of marketable securities | 14,700 | 1,200,000 | 184,500 | ||
Unrealized gain (losses) on investment securities | 993,600 | ||||
Other Investments, estimated fair value | 27,372,000 | 27,372,000 | $ 2,488,000 | ||
Investments | 645,074,000 | 645,074,000 | $ 528,593,000 | ||
Cash distributions, net of allocation received | 272,000 | 94,000 | |||
Investment allocated cost | 741,000 | 429,000 | 1,958,000 | 1,595,000 | |
LLCs [Member] | |||||
Investments [Line Items] | |||||
Other Investments, estimated fair value | 6,400,000 | 6,400,000 | |||
LPs [Member] | |||||
Investments [Line Items] | |||||
Other Investments, estimated fair value | 21,000,000 | 21,000,000 | |||
LPs and LLCs [Member] | |||||
Investments [Line Items] | |||||
Investments | 24,900,000 | 24,900,000 | |||
Investment allocated cost | $ 565,000 | 1,300 | |||
Net investment gains | $ 1,000,000 | ||||
Reclassification [Member] | |||||
Investments [Line Items] | |||||
Other revenue | 128,000 | 927,000 | |||
Net realized and unrealized gains (losses) | $ (128,000) | $ (927,000) |
Investments - Schedule of Amort
Investments - Schedule of Amortized Cost and Fair Value of Investment Securities by Contractual Maturity (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Investments Debt And Equity Securities [Abstract] | ||
Maturity date Due in one year or less, Cost or Amortized Cost | $ 67,878 | |
Maturity date Due after one year through five years, Cost or Amortized Cost | 199,455 | |
Maturity date Due after five years through ten years, Cost or Amortized Cost | 139,435 | |
Maturity date Due after ten years, Cost or Amortized Cost | 198,053 | |
Fixed maturity securities, available-for-sale, Cost or Adjusted / Amortized Cost | $ 604,821 | $ 518,391 |
Maturity date Due in one year or less, Percentage of Total | 11.00% | |
Maturity date Due after one year through five years, Percentage of Total | 33.00% | |
Maturity date Due after five years through ten years, Percentage of Total | 23.00% | |
Maturity date Due after ten years, Percentage of Total | 33.00% | |
Maturity date Total, Percentage | 100.00% | |
Maturity date Due in one year or less, Fair Value | $ 68,007 | |
Maturity date Due after one year through five years, Fair Value | 201,696 | |
Maturity date Due after five years through ten years, Fair Value | 144,386 | |
Maturity date Due after ten years, Fair Value | 201,995 | |
Maturity date Total, Fair Value | $ 616,084 | $ 509,649 |
Maturity date Due in one year or less, Percentage of Total | 11.00% | |
Maturity date Due after one year through five years, Percentage of Total | 33.00% | |
Maturity date Due after five years through ten years, Percentage of Total | 23.00% | |
Maturity date Due after ten years, Percentage of Total | 33.00% | |
Maturity date Total, Percentage | 100.00% |
Investments - Summary of Net In
Investments - Summary of Net Investment Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Schedule of Available-for-sale Securities [Line Items] | ||||
Gross investment income (loss) | $ 4,396 | $ 4,276 | $ 13,115 | $ 11,299 |
Less: Investment expenses | 741 | 429 | 1,958 | 1,595 |
Net investment income, less investment expenses | 3,655 | 3,847 | 11,157 | 9,704 |
Fixed Maturity Securities [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Gross investment income (loss) | 3,492 | 3,020 | 10,625 | 8,018 |
Equity Securities [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Gross investment income (loss) | 22 | 547 | 944 | 1,252 |
Cash and Cash Equivalents [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Gross investment income (loss) | 558 | 284 | 1,288 | 861 |
Other Investments [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Gross investment income (loss) | $ 324 | $ 425 | $ 258 | $ 1,168 |
Investments - Aging of Gross Un
Investments - Aging of Gross Unrealized Losses on Fixed Maturity Investments (Detail) $ in Thousands | Sep. 30, 2019USD ($)Security | Dec. 31, 2018USD ($)Security |
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Number of Securities | Security | 78 | 404 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Gross Unrealized Losses | $ 52 | $ 3,164 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Fair Value | $ 25,657 | $ 172,381 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Number of Securities | Security | 183 | 690 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Gross Unrealized Losses | $ 196 | $ 5,955 |
Fixed maturity securities, available-for-sale Twelve Months or More, Fair Value | $ 35,698 | $ 241,126 |
U.S. government and agency securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Number of Securities | Security | 4 | 17 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Gross Unrealized Losses | $ 2 | $ 129 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Fair Value | $ 450 | $ 10,485 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Number of Securities | Security | 25 | 66 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Gross Unrealized Losses | $ 22 | $ 609 |
Fixed maturity securities, available-for-sale Twelve Months or More, Fair Value | $ 4,523 | $ 20,488 |
States, Municipalities and Political Subdivisions [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Number of Securities | Security | 2 | 13 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Gross Unrealized Losses | $ 14 | $ 103 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Fair Value | $ 6,026 | $ 12,864 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Number of Securities | Security | 4 | 42 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Gross Unrealized Losses | $ 6 | $ 682 |
Fixed maturity securities, available-for-sale Twelve Months or More, Fair Value | $ 2,456 | $ 39,979 |
Special Revenue [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Number of Securities | Security | 52 | 105 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Gross Unrealized Losses | $ 22 | $ 1,260 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Fair Value | $ 13,154 | $ 76,335 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Number of Securities | Security | 123 | 323 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Gross Unrealized Losses | $ 138 | $ 2,621 |
Fixed maturity securities, available-for-sale Twelve Months or More, Fair Value | $ 18,524 | $ 108,319 |
Industrial and Miscellaneous [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Number of Securities | Security | 20 | 214 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Gross Unrealized Losses | $ 14 | $ 1,479 |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Fair Value | $ 6,027 | $ 70,156 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Number of Securities | Security | 31 | 232 |
Fixed maturity securities, available-for-sale, Twelve Months or More, Gross Unrealized Losses | $ 30 | $ 1,822 |
Fixed maturity securities, available-for-sale Twelve Months or More, Fair Value | $ 10,195 | $ 70,375 |
Redeemable Preferred Stocks [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Number of Securities | Security | 55 | |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Gross Unrealized Losses | $ 193 | |
Fixed maturity securities, available-for-sale, Less Than Twelve Months, Fair Value | $ 2,541 | |
Fixed maturity securities, available-for-sale, Twelve Months or More, Number of Securities | Security | 27 | |
Fixed maturity securities, available-for-sale, Twelve Months or More, Gross Unrealized Losses | $ 221 | |
Fixed maturity securities, available-for-sale Twelve Months or More, Fair Value | $ 1,965 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Investment exit load percentage within one year which expires in February 2020 | 3.00% | ||
Nonrecurring [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Non-recurring fair value adjustments | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Schedule of Fair Value of Financial Instruments (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | $ 616,084 | $ 509,649 |
Investments reported at NAV | 28,990 | 3,910 |
Total investments | 645,074 | 528,593 |
Equity securities | 15,034 | |
Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 366 | 4,861 |
Total investments | 366 | 19,895 |
Equity securities | 15,034 | |
Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 615,718 | 504,788 |
Total investments | 615,718 | 504,788 |
U.S. government and agency securities [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 62,989 | 48,041 |
U.S. government and agency securities [Member] | Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 366 | 354 |
U.S. government and agency securities [Member] | Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 62,623 | 47,687 |
States, Municipalities and Political Subdivisions [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 81,211 | 59,289 |
States, Municipalities and Political Subdivisions [Member] | Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 81,211 | 59,289 |
Special Revenue [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 269,519 | 245,355 |
Special Revenue [Member] | Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 269,519 | 245,355 |
Industrial and Miscellaneous [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 202,365 | 152,457 |
Industrial and Miscellaneous [Member] | Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | $ 202,365 | 152,457 |
Redeemable Preferred Stocks [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 4,507 | |
Redeemable Preferred Stocks [Member] | Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed maturity securities, available-for-sale, Fair Value | 4,507 | |
Common Stock [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | 2,264 | |
Common Stock [Member] | Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | 2,264 | |
Nonredeemable Preferred Stocks [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | 12,770 | |
Nonredeemable Preferred Stocks [Member] | Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | $ 12,770 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Schedule of Fair Value of Financial Instruments (Parenthetical) (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value Disclosures [Abstract] | ||
Federal Home Loan Bank (FHLB) stock, at cost | $ 1,618 | $ 1,422 |
Other Comprehensive Income - Ad
Other Comprehensive Income - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Comprehensive Income Net Of Tax [Abstract] | ||||
Other comprehensive income | $ 3,291 | $ (1,235) | $ 15,077 | $ (6,362) |
Other Comprehensive Income - Ef
Other Comprehensive Income - Effect on Other Comprehensive Income due to Changes in Unrealized Gains and Losses, Net of Taxes on Fixed Maturities Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Other comprehensive income | ||||
Change in unrealized losses on investments, net, Pre-tax | $ 4,429 | $ (2,895) | $ 19,533 | $ (9,918) |
Reclassification adjustment of realized losses (gains) included in net income, Pre-tax | (103) | (5) | 291 | 307 |
Effect on other comprehensive income, Pre-tax | 4,326 | (2,900) | 19,824 | (9,611) |
Change in unrealized losses on investments, net, Tax | (1,060) | 1,666 | (4,677) | 3,185 |
Reclassification adjustment of realized losses (gains) included in net income, Tax | 25 | (1) | (70) | 64 |
Effect on other comprehensive income, Tax | (1,035) | 1,665 | (4,747) | 3,249 |
Change in unrealized losses on investments, net, After-tax | 3,369 | (1,229) | 14,856 | (6,733) |
Reclassification adjustment of realized losses (gains) included in net income, After-tax | (78) | (6) | 221 | 371 |
Effect on other comprehensive income, After-tax | $ 3,291 | $ (1,235) | $ 15,077 | $ (6,362) |
Leases - Additional Information
Leases - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2019 | |
Lessee Lease Description [Line Items] | |
Lease renewal, Description | one or more options to renew. |
Minimum [Member] | |
Lessee Lease Description [Line Items] | |
Lease terms | 1 year |
Renewal terms of lease | 2 years |
Maximum [Member] | |
Lessee Lease Description [Line Items] | |
Lease terms | 10 years |
Renewal terms of lease | 10 years |
Leases - Components of Lease Co
Leases - Components of Lease Costs (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Leases [Abstract] | ||
Amortization of ROU assets - Finance leases | $ 19 | $ 58 |
Interest on lease liabilities - Finance leases | 6 | 17 |
Variable lease cost (cost excluded from lease payments) | 113 | 337 |
Operating lease cost (cost resulting from lease payments) | 331 | 918 |
Total lease cost | $ 469 | $ 1,330 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information and Non-Cash Activity Related to Operating and Financing Leases (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Leases [Abstract] | |
Finance lease - Operating cash flows | $ 20 |
Finance lease - Financing cash flows | 66 |
Operating lease - Operating cash flows (fixed payments) | 613 |
Operating lease - Operating cash flows (liability reduction) | $ 465 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information Related to Operating and Financing Leases (Detail) $ in Thousands | Sep. 30, 2019USD ($) |
Leases [Abstract] | |
Right-of-use assets - operating | $ 6,567 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:OtherAssets |
Right-of-use assets - finance | $ 323 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:OtherAssets |
Lease Liability - operating | $ (8,293) |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilities |
Lease Liability - finance | $ (342) |
Finance Lease, Liability, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilities |
Leases - Supplemental Balance_2
Leases - Supplemental Balance Sheet Information Related to Operating and Financing Leases (Parenthetical) (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Leases [Abstract] | |
Lease incentives received | $ 1.3 |
Leases - Weighted-Average Remai
Leases - Weighted-Average Remaining Lease Term and Discount Rate for Operating and Financing Leases (Detail) | Sep. 30, 2019 |
Leases [Abstract] | |
Weighted average lease term - Finance leases | 3 years 10 months 28 days |
Weighted average lease term - Operating leases | 8 years 2 months 8 days |
Weighted average discount rate - Finance leases | 7.09% |
Weighted average discount rate - Operating leases | 5.32% |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities by Fiscal Year for Operating and Financing Leases (Detail) $ in Thousands | Sep. 30, 2019USD ($) |
Leases [Abstract] | |
2019 remaining | $ 380 |
2020 | 1,442 |
2021 | 1,401 |
2022 | 1,425 |
2023 | 1,371 |
2024 and thereafter | 4,695 |
Total lease payments | 10,714 |
Less: imputed interest | (2,079) |
Present value of lease liabilities | $ 8,635 |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property and Equipment, Net (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Total, at cost | $ 30,355 | $ 25,601 |
Less: accumulated depreciation and amortization | (9,482) | (7,603) |
Property and equipment, net | 20,873 | 17,998 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total, at cost | 2,582 | 2,582 |
Building [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total, at cost | 11,390 | 11,390 |
Computer Hardware and Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total, at cost | 5,539 | 4,901 |
Office Furniture and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total, at cost | 1,973 | 1,397 |
Tenant and Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total, at cost | 8,082 | 4,477 |
Vehicle Fleet [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total, at cost | $ 789 | $ 854 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019USD ($)Building | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)aft²Building | Sep. 30, 2018USD ($) | |
Property Plant And Equipment Useful Life And Values [Abstract] | ||||
Depreciation and amortization expense | $ | $ 649,000 | $ 1,000,000 | $ 1,900,000 | $ 1,700,000 |
Number of acres of land purchased | a | 15 | |||
Number of buildings | Building | 5 | 5 | ||
Gross area of acquired property | ft² | 229,000 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Finite Lived Intangible Assets [Line Items] | |||||
Goodwill | $ 152,459,000 | $ 152,459,000 | $ 152,459,000 | ||
Intangibles, net | 70,569,000 | 70,569,000 | $ 76,850,000 | ||
Indefinite lived intangible, insurance licenses | 1,300,000 | 1,300,000 | |||
Amortization of intangible assets | 2,100,000 | $ 6,400,000 | 6,300,000 | $ 19,700,000 | |
Impairment of amortizing intangible assets | 0 | 0 | 0 | 0 | |
Impairment of non-amortizing intangible assets | $ 0 | $ 0 | $ 0 | $ 0 | |
Minimum [Member] | |||||
Finite Lived Intangible Assets [Line Items] | |||||
Useful life of intangible asset | 2 years 6 months | ||||
Finite-lived intangible assets useful lives | 2 years 6 months | ||||
Maximum [Member] | |||||
Finite Lived Intangible Assets [Line Items] | |||||
Useful life of intangible asset | 15 years | ||||
Finite-lived intangible assets useful lives | 15 years |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Schedule of Goodwill (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Beginning balance | $ 152,459 |
Ending balance | $ 152,459 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Schedule of Estimated Amortization of Intangible Assets (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
2019 remaining | $ 1,927 |
2020 | 6,365 |
2021 | 6,351 |
2022 | 6,351 |
2023 | 6,351 |
2024 | 6,351 |
Thereafter | 35,558 |
Total | $ 69,254 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Schedule of Estimated Amortization of Intangible Assets (Parenthetical) (Details) $ in Millions | Sep. 30, 2019USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Indefinite lived intangible, insurance licenses | $ 1.3 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Computation of Basic and Diluted Earnings Per Share (EPS) (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Basic earnings per share: | ||||
Net income attributable to common stockholders (000's) | $ 8,133 | $ 5,989 | $ 15,818 | $ 23,227 |
Weighted average shares outstanding | 29,109,962 | 25,631,871 | 29,329,742 | 25,663,415 |
Basic earnings per share: | $ 0.28 | $ 0.23 | $ 0.54 | $ 0.91 |
Diluted earnings per share: | ||||
Net income attributable to common stockholders (000's) | $ 8,133 | $ 5,989 | $ 15,818 | $ 23,227 |
Weighted average shares outstanding | 29,109,962 | 25,631,871 | 29,329,742 | 25,663,415 |
Weighted average dilutive shares | 58,430 | 415,067 | 23,014 | 677,344 |
Total weighted average dilutive shares | 29,168,392 | 26,046,938 | 29,352,756 | 26,340,759 |
Diluted earnings per share: | $ 0.28 | $ 0.23 | $ 0.54 | $ 0.88 |
Deferred Reinsurance Ceding C_3
Deferred Reinsurance Ceding Commission - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Policy Acquisition Costs [Member] | ||||
Deferred Reinsurance Ceding Commission [Line Items] | ||||
Ceding commission income | $ 11.3 | $ 13.7 | $ 36.8 | $ 42.1 |
General and Administrative Expenses [Member] | ||||
Deferred Reinsurance Ceding Commission [Line Items] | ||||
Ceding commission income | $ 3.7 | $ 4.5 | $ 12 | $ 13.8 |
Deferred Reinsurance Ceding C_4
Deferred Reinsurance Ceding Commission - Schedule of Activity with Regard to Deferred Reinsurance Ceding Commission (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Insurance [Abstract] | ||||
Beginning balance of deferred ceding commission income | $ 34,705 | $ 42,666 | $ 44,996 | $ 42,665 |
Ceding commission deferred | 15,542 | 18,932 | 39,017 | 56,495 |
Less: ceding commission earned | (15,062) | (18,307) | (48,828) | (55,869) |
Ending balance of deferred ceding commission income | $ 35,185 | $ 43,291 | $ 35,185 | $ 43,291 |
Deferred Policy Acquisition C_3
Deferred Policy Acquisition Costs - Summary of Activity in Deferred Policy Acquisition Costs (DPAC) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Insurance [Abstract] | ||||
Beginning Balance | $ 74,064 | $ 69,648 | $ 73,055 | $ 41,678 |
Policy acquisition costs deferred | 26,856 | 12,108 | 100,757 | 68,048 |
Amortization | (25,307) | (6,054) | (98,199) | (34,024) |
Ending Balance | $ 75,613 | $ 75,702 | $ 75,613 | $ 75,702 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||||
Provision for income taxes | $ 2,950,000 | $ 3,002,000 | $ 5,687,000 | $ 9,068,000 | |
Annual effective tax rate | 26.60% | 33.40% | 26.40% | 28.10% | |
Uncertain tax positions | $ 0 | $ 0 | $ 0 |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax Assets (Liabilities) (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Unearned premiums | $ 10,752 | $ 12,090 |
Unearned commission | 8,426 | 10,733 |
Net operating loss | 109 | 109 |
Tax-related discount on loss reserve | 2,669 | 2,329 |
Unrealized loss | 2,631 | |
Stock-based compensation | 1,190 | 297 |
Accrued expenses | 1,296 | 2,321 |
Other | 2,466 | 1,443 |
Total deferred tax asset | 26,908 | 31,953 |
Deferred tax liabilities: | ||
Deferred acquisition costs | 18,107 | 17,494 |
Prepaid expenses | 192 | 112 |
Unrealized gains | 2,936 | |
Property and equipment | 304 | 664 |
Note discount | 468 | 710 |
Basis in purchased investments | 114 | 163 |
Basis in purchased intangibles | 17,564 | 18,982 |
Other | 1,501 | 1,533 |
Total deferred tax liabilities | 41,186 | 39,658 |
Net deferred tax liability | $ (14,278) | $ (7,705) |
Reinsurance - Additional inform
Reinsurance - Additional information (Detail) | 9 Months Ended |
Sep. 30, 2019 | |
Catastrophe [Member] | |
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |
Reinsurance premium, amortization period | 12 months |
Quota Share [Member] | |
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |
Reinsurance premium, amortization period | 12 months |
Reinsurance - 2019-2020 Excess
Reinsurance - 2019-2020 Excess of Loss Reinsurance Programs - Catastrophe Excess of Loss Reinsurance - Additional information - (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Purchase of reinsurance from third party | $ 107,755,000 | $ 115,926,000 | $ 342,529,000 | $ 356,748,000 | |
Reinsurance payable | 254,152,000 | $ 254,152,000 | $ 166,975,000 | ||
FHCF [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Percentage comprising aggregate participation | 90.00% | 45.00% | |||
2019-2020 Excess of Loss Reinsurance Programs [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Reinsurance purchase limit | 2,600,000,000 | $ 2,600,000,000 | |||
Purchase of reinsurance from third party | 2,600,000,000 | ||||
Reinsurance payable | 249,200,000 | 249,200,000 | |||
2019-2020 Excess of Loss Reinsurance Programs [Member] | NBIC [Member] | First Catastrophic Event [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
First event retention for insurance company subsidiary | 13,800,000 | 13,800,000 | |||
2019-2020 Excess of Loss Reinsurance Programs [Member] | NBIC [Member] | First Catastrophic Event [Member] | Maximum [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Retention under program to provide reinsurance coverage | 936,000,000 | ||||
2019-2020 Excess of Loss Reinsurance Programs [Member] | Heritage P&C [Member] | First Catastrophic Event [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
First event retention for insurance company subsidiary | 20,000,000 | 20,000,000 | |||
2019-2020 Excess of Loss Reinsurance Programs [Member] | Heritage P&C [Member] | First Catastrophic Event [Member] | Maximum [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Retention under program to provide reinsurance coverage | 1,500,000,000 | ||||
2019-2020 Excess of Loss Reinsurance Programs [Member] | Zephyr [Member] | First Catastrophic Event [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
First event retention for insurance company subsidiary | $ 20,000,000 | 20,000,000 | |||
2019-2020 Excess of Loss Reinsurance Programs [Member] | Zephyr [Member] | First Catastrophic Event [Member] | Maximum [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Retention under program to provide reinsurance coverage | $ 708,000,000 |
Reinsurance - 2019-2020 Exces_2
Reinsurance - 2019-2020 Excess of Loss Reinsurance Programs - Gross Quota and Net Quota Share Reinsurance - Additional information - (Detail) - NBIC [Member] - USD ($) $ in Millions | 5 Months Ended | 7 Months Ended | 9 Months Ended | 12 Months Ended | |
May 31, 2018 | Dec. 31, 2018 | Sep. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Gross Quota Share [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Percentage of gross quota share | 18.75% | 8.00% | |||
Reinsurance recoveries on paid losses | $ 1,000 | $ 1,000 | |||
Net Quota Share Reinsurance [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Net lines quota share occurrence limit | $ 20 | $ 20 | |||
Percentage of renewed ceded net premium and losses | 52.00% | 52.00% | 10.00% |
Reinsurance - 2019-2020 Exces_3
Reinsurance - 2019-2020 Excess of Loss Reinsurance Programs - Aggregate Coverage - Additional information - (Detail) $ in Thousands | Dec. 31, 2018USD ($)Reinsurer | Sep. 30, 2019USD ($)Reinsurer | Dec. 31, 2018USD ($)Reinsurer |
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||
Prepaid reinsurance premiums | $ 233,071 | $ 270,645 | $ 233,071 |
Number of reinstatements available | Reinsurer | 2 | 2 | |
Aggregate Coverage [Member] | Catastrophe [Member] | |||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||
Purchased aggregate reinstatement premium | $ 931,000 | $ 1,100,000 | |
Prepaid reinsurance premiums | 669,000 | 627,000 | 669,000 |
Net of prepaid reinsurance premium as attachment point | 40,000 | $ 40,000 | $ 40,000 |
40.00% Aggregate Coverage [Member] | NBIC [Member] | |||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||
Aggregate contract coverage limit | 20,000 | ||
Primary retention | 20,000 | ||
Franchise deductible amount | $ 1,000 | ||
Aggregate contract expiration date | May 31, 2019 | ||
Percentage of aggregate contract | 40.00% | 40.00% | |
100.00% Aggregate Coverage [Member] | NBIC [Member] | |||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||
Aggregate contract coverage limit | $ 20,000 | ||
Primary retention | $ 20,000 | ||
Aggregate contract expiration date | Dec. 31, 2019 | ||
Percentage of aggregate contract | 100.00% | 100.00% | |
Number of reinstatements available | Reinsurer | 1 |
Reinsurance - 2019-2020 Exces_4
Reinsurance - 2019-2020 Excess of Loss Reinsurance Programs - Additional information - (Detail) | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2019USD ($)ReinsurerLayer | Dec. 31, 2018USD ($)Reinsurer | Jun. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2017USD ($) | |
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Unpaid losses and loss adjustment expenses | $ 417,586,000 | $ 432,359,000 | $ 430,413,000 | $ 421,095,000 | $ 488,610,000 | $ 470,083,000 |
Reinsurance payable | $ 254,152,000 | $ 166,975,000 | ||||
Number of reinstatements available | Reinsurer | 2 | 2 | ||||
Facultative Reinsurance [Member] | Maximum [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Reinsurance payable | $ 10,000,000 | $ 10,000,000 | ||||
Facultative Reinsurance [Member] | Minimum [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Facultative reinsurance purchase amount | $ 10,000,000 | 10,000,000 | ||||
General Excess of Loss 2019-2020 Reinsurance Program [Member] | NBIC [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Number of loss applied to reinsurance contract | Reinsurer | 1 | |||||
Number of layers in excess of rentention loss | Layer | 2 | |||||
Retention under program to provide reinsurance coverage | $ 400,000 | |||||
General Excess of Loss 2019-2020 Reinsurance Program [Member] | NBIC [Member] | First Layer Coverage [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Retention under program to provide reinsurance coverage | 350,000 | |||||
Primary retention | 400,000 | |||||
General Excess of Loss 2019-2020 Reinsurance Program [Member] | NBIC [Member] | Second Layer Coverage | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Retention under program to provide reinsurance coverage | 2,750,000 | |||||
Primary retention | 750,000 | |||||
General Excess of Loss 2019-2020 Reinsurance Program [Member] | NBIC [Member] | Casualty Second Layer [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Retention under program to provide reinsurance coverage | 1,250,000 | |||||
Primary retention | $ 750,000 | |||||
General Excess of Loss 2019-2020 Reinsurance Program [Member] | NBIC [Member] | First and Second Layer Coverage [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Percentage of gross quota share | 100.00% | |||||
Facultative 2019 - 2020 Excess of Loss Reinsurance Program [Member] | Minimum [Member] | NBIC [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Reinsurance payable | $ 3,500,000 | |||||
Northeast Commercial Residential Losses [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Number of reinstatements available | Reinsurer | 2 | |||||
Insurance Claims [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Unpaid losses and loss adjustment expenses | $ 1,000,000 | 1,000,000 | ||||
Insurance Claims [Member] | Northeast Commercial Residential Losses [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Unpaid losses and loss adjustment expenses | 750,000 | |||||
Property Per Risk Coverage [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Coverage limit | 9,000,000 | 9,000,000 | ||||
Reinsurance payable | 27,000,000 | $ 27,000,000 | ||||
Property Per Risk Coverage [Member] | Northeast Commercial Residential Losses [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Coverage limit | 250,000 | |||||
Reinsurance payable | $ 750,000 |
Reinsurance - 2018-2019 Reinsur
Reinsurance - 2018-2019 Reinsurance Programs - Catastrophe Excess of Loss Reinsurance - Additional information - (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Purchase of reinsurance from third party | $ 107,755,000 | $ 115,926,000 | $ 342,529,000 | $ 356,748,000 | |
Reinsurance payable | $ 254,152,000 | $ 254,152,000 | $ 166,975,000 | ||
FHCF [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Percentage comprising aggregate participation | 90.00% | 45.00% | |||
2018 - 2019 Reinsurance Program [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Reinsurance purchase limit | $ 3,400,000,000 | ||||
Purchase of reinsurance from third party | 3,500,000,000 | ||||
Reinsurance payable | 252,000,000 | ||||
2018 - 2019 Reinsurance Program [Member] | NBIC [Member] | First Catastrophic Event [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
First event retention for insurance company subsidiary | 12,800,000 | ||||
2018 - 2019 Reinsurance Program [Member] | NBIC [Member] | First Catastrophic Event [Member] | Maximum [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Retention under program to provide reinsurance coverage | 1,000,000,000 | ||||
2018 - 2019 Reinsurance Program [Member] | NBIC [Member] | Second Catastrophic Event [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Retention under program to provide reinsurance coverage | 8,800,000 | ||||
2018 - 2019 Reinsurance Program [Member] | Heritage P&C [Member] | First Catastrophic Event [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
First event retention for insurance company subsidiary | 20,000,000 | ||||
2018 - 2019 Reinsurance Program [Member] | Heritage P&C [Member] | First Catastrophic Event [Member] | Maximum [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Retention under program to provide reinsurance coverage | 1,600,000,000 | ||||
2018 - 2019 Reinsurance Program [Member] | Heritage P&C [Member] | Second Catastrophic Event [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Retention under program to provide reinsurance coverage | 16,000,000 | ||||
2018 - 2019 Reinsurance Program [Member] | Zephyr [Member] | First Catastrophic Event [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
First event retention for insurance company subsidiary | 20,000,000 | ||||
2018 - 2019 Reinsurance Program [Member] | Zephyr [Member] | First Catastrophic Event [Member] | Maximum [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Retention under program to provide reinsurance coverage | 801,000,000 | ||||
2018 - 2019 Reinsurance Program [Member] | Zephyr [Member] | Second Catastrophic Event [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Retention under program to provide reinsurance coverage | $ 16,000,000 |
Reinsurance - 2018-2019 Reins_2
Reinsurance - 2018-2019 Reinsurance Programs - Gross Quota and Net Quota Share Reinsurance - Additional information - (Detail) - NBIC [Member] - USD ($) $ in Millions | 5 Months Ended | 7 Months Ended | 9 Months Ended | 12 Months Ended | |
May 31, 2018 | Dec. 31, 2018 | Sep. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Gross Quota Share [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Percentage of gross quota share | 18.75% | 8.00% | |||
Reinsurance recoveries on paid losses | $ 1,000 | $ 1,000 | |||
Net Quota Share Reinsurance [Member] | |||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | |||||
Net lines quota share occurrence limit | $ 20 | $ 20 | |||
Percentage of ceded net premium and losses | 49.50% | 49.50% | 8.00% | ||
Percentage of renewed ceded net premium and losses | 52.00% | 52.00% | 10.00% |
Reinsurance - 2018-2019 Reins_3
Reinsurance - 2018-2019 Reinsurance Programs - Aggregate Coverage - Additional information - (Detail) $ in Thousands | Dec. 31, 2018USD ($)Reinsurer | May 31, 2018USD ($) | Sep. 30, 2019USD ($)Reinsurer | Dec. 31, 2018USD ($)Reinsurer |
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||
Prepaid reinsurance premiums | $ 233,071 | $ 270,645 | $ 233,071 | |
Number of reinstatements available | Reinsurer | 2 | 2 | ||
Aggregate Coverage [Member] | Catastrophe [Member] | ||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||
Purchased aggregate reinstatement premium | $ 931,000 | $ 1,100,000 | ||
Prepaid reinsurance premiums | 669,000 | 627,000 | 669,000 | |
Net of prepaid reinsurance premium as attachment point | 40,000 | $ 40,000 | $ 40,000 | |
42.50% Aggregate Coverage [Member] | NBIC [Member] | ||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||
Aggregate contract coverage limit | $ 20,000 | |||
Primary retention | 3,000 | |||
Franchise deductible amount | $ 1,500 | |||
Aggregate contract expiration date | Dec. 31, 2018 | |||
Percentage of aggregate contract | 42.50% | |||
92.00% Aggregate Coverage [Member] | NBIC [Member] | ||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||
Aggregate contract coverage limit | $ 20,000 | |||
Primary retention | $ 20,000 | |||
Aggregate contract expiration date | Dec. 31, 2018 | |||
Percentage of aggregate contract | 92.00% | |||
40.00% Aggregate Coverage [Member] | NBIC [Member] | ||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||
Aggregate contract coverage limit | 20,000 | |||
Primary retention | 20,000 | |||
Franchise deductible amount | $ 1,000 | |||
Aggregate contract expiration date | May 31, 2019 | |||
Percentage of aggregate contract | 40.00% | 40.00% | ||
100.00% Aggregate Coverage [Member] | NBIC [Member] | ||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||
Aggregate contract coverage limit | $ 20,000 | |||
Primary retention | $ 20,000 | |||
Number of reinstatements available | Reinsurer | 1 | |||
Aggregate contract expiration date | Dec. 31, 2019 | |||
Percentage of aggregate contract | 100.00% | 100.00% |
Reinsurance - 2018-2019 Reins_4
Reinsurance - 2018-2019 Reinsurance Programs - Additional information - (Detail) | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2019USD ($)Reinsurer | Dec. 31, 2018USD ($)ReinsurerLayer | Jun. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2017USD ($) | |
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Unpaid losses and loss adjustment expenses | $ 417,586,000 | $ 432,359,000 | $ 430,413,000 | $ 421,095,000 | $ 488,610,000 | $ 470,083,000 |
Reinsurance payable | $ 254,152,000 | $ 166,975,000 | ||||
Number of reinstatements available | Reinsurer | 2 | 2 | ||||
Facultative Reinsurance [Member] | Maximum [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Reinsurance payable | $ 10,000,000 | $ 10,000,000 | ||||
Facultative Reinsurance [Member] | Minimum [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Facultative reinsurance purchase amount | 10,000,000 | $ 10,000,000 | ||||
General Excess of Loss 2018-2019 Reinsurance Program [Member] | NBIC [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Number of loss applied to reinsurance contract | Reinsurer | 1 | |||||
Number of layers in excess of rentention loss | Layer | 2 | |||||
Retention under program to provide reinsurance coverage | $ 300,000 | |||||
General Excess of Loss 2018-2019 Reinsurance Program [Member] | NBIC [Member] | First Layer Coverage [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Retention under program to provide reinsurance coverage | 450,000 | |||||
Primary retention | 300,000 | |||||
General Excess of Loss 2018-2019 Reinsurance Program [Member] | NBIC [Member] | Second Layer Coverage | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Retention under program to provide reinsurance coverage | 2,750,000 | |||||
Primary retention | 750,000 | |||||
General Excess of Loss 2018-2019 Reinsurance Program [Member] | NBIC [Member] | Casualty Second Layer [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Retention under program to provide reinsurance coverage | 1,250,000 | |||||
Primary retention | $ 750,000 | |||||
General Excess of Loss 2018-2019 Reinsurance Program [Member] | NBIC [Member] | First and Second Layer Coverage [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Percentage of gross quota share | 92.00% | |||||
Additional coverage percentage of gross quota share | 8.00% | |||||
Facultative 2018 - 2019 Reinsurance Program [Member] | Minimum [Member] | NBIC [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Reinsurance payable | $ 3,500,000 | |||||
Insurance Claims [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Unpaid losses and loss adjustment expenses | 1,000,000 | 1,000,000 | ||||
Property Per Risk Coverage [Member] | ||||||
Reinsurance Premiums For Insurance Companies By Product Segment [Line Items] | ||||||
Coverage limit | 9,000,000 | 9,000,000 | ||||
Reinsurance payable | $ 27,000,000 | $ 27,000,000 |
Reinsurance - Schedule of Effec
Reinsurance - Schedule of Effect of Reinsurance Arrangements in Consolidated Statement of Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Premiums Written | ||||
Premiums Written, Direct | $ 237,303 | $ 233,613 | $ 702,491 | $ 701,643 |
Premiums Written, Ceded | (46,858) | (102,651) | (406,300) | (411,634) |
Premiums Written, Net | 190,445 | 130,962 | 296,191 | 290,009 |
Premiums Earned | ||||
Premiums Earned, Direct | 231,617 | 234,164 | 690,165 | 692,298 |
Premiums Earned, Ceded | (107,755) | (115,926) | (342,529) | (356,748) |
Net premiums earned | 123,862 | 118,238 | 347,636 | 335,550 |
Losses and Loss Adjustment Expenses | ||||
Losses and Loss Adjustment Expenses, Direct | 108,788 | 145,753 | 383,354 | 697,743 |
Losses and Loss Adjustment Expenses, Ceded | (38,736) | (87,058) | (176,864) | (519,968) |
Losses and Loss Adjustment Expenses, Net | $ 70,052 | $ 58,695 | $ 206,490 | $ 177,775 |
Reserve for Unpaid Losses - Sum
Reserve for Unpaid Losses - Summary of Reserve for Unpaid Losses (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Insurance [Abstract] | ||||
Balance, beginning of period | $ 430,413 | $ 488,610 | $ 432,359 | $ 470,083 |
Less: reinsurance recoverable on unpaid losses | 223,023 | 315,308 | 250,506 | 315,353 |
Net balance, beginning of period | 207,390 | 173,302 | 181,853 | 154,730 |
Incurred related to: | ||||
Current year | 73,448 | 61,900 | 208,796 | 163,115 |
Prior years | (396) | (3,205) | (2,306) | 14,660 |
Total incurred | 73,052 | 58,695 | 206,490 | 177,775 |
Paid related to: | ||||
Current year | 53,920 | 19,544 | 94,075 | 41,361 |
Prior years | 17,820 | 17,585 | 85,566 | 96,276 |
Total paid | 71,740 | 37,129 | 179,641 | 137,637 |
Net balance, end of period | 208,702 | 194,868 | 208,702 | 194,868 |
Plus: reinsurance recoverable on unpaid losses | 208,884 | 226,227 | 208,884 | 226,227 |
Balance, end of period | $ 417,586 | $ 421,095 | $ 417,586 | $ 421,095 |
Reserve for Unpaid Losses - Add
Reserve for Unpaid Losses - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | |
Insurance [Abstract] | ||||||||
Unpaid losses and loss adjustment expenses | $ 208,702 | $ 194,868 | $ 208,702 | $ 194,868 | $ 207,390 | $ 181,853 | $ 173,302 | $ 154,730 |
Unpaid losses and loss adjustment expenses attributable to IBNR net of reinsurance recoverables | $ 158,200 | $ 158,200 | ||||||
Net reserves for unpaid losses and loss adjustment expenses, percentage | 75.80% | 75.80% | ||||||
Losses incurred favorable development | $ (396) | $ (3,205) | $ (2,306) | $ 14,660 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) - USD ($) | Feb. 19, 2019 | Dec. 31, 2018 | Oct. 31, 2017 | Mar. 31, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 31, 2017 |
Debt Instrument [Line Items] | ||||||||
Long-term debt, net | $ 148,794,000 | $ 130,849,000 | ||||||
Issuance and debt discount costs | $ 6,963,000 | 5,202,000 | ||||||
Convertible notes converted into common stock | $ 4,210,000 | |||||||
Payout dividends, aggregate amount | 5,188,000 | $ 4,789,000 | ||||||
Maximum [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Payout dividends, aggregate amount | 10,000,000 | |||||||
Federal Home Loan Bank Of Atlanta [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest paid | 452,000 | |||||||
FHLB advance Interest rate | 3.094% | |||||||
Cash loan received under advance from FHLB | $ 19,200,000 | |||||||
Required fair value of reinvestment in FHLB common stock. | $ 1,400,000 | 1,400,000 | ||||||
Estimated fair value of collateral with FHLB | 24,500,000 | |||||||
Federal Home Loan Bank Des Moines [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Required fair value of reinvestment in FHLB common stock. | 140,200 | |||||||
Federal Home Loan Bank Boston [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Required fair value of reinvestment in FHLB common stock. | $ 76,600 | |||||||
Convertible Note [Member] | Heritage Insurance Holdings, Inc. [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Repurchase of convertible notes | $ 5,800,000 | |||||||
Cash consideration paid for repurchase of debt | $ 2,900,000 | |||||||
Shares issued for consideration of repurchase debt | 285,201 | |||||||
Convertible notes converted into common stock | $ 4,200,000 | |||||||
Non-operating loss extinguishment of debt | $ (48,000) | |||||||
Convertible Senior Notes [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 136,800,000 | $ 136,800,000 | ||||||
Interest rate | 5.875% | 5.875% | ||||||
Notes maturity date | Aug. 1, 2037 | |||||||
Interest payments term | Interest is payable semi-annually in arrears, on February 1, and August 1 of each year, commencing in 2018. | |||||||
Long-term debt, net | $ 21,100,000 | |||||||
Issuance and debt discount costs | 2,300,000 | |||||||
Interest paid | 1.5 | 7,700,000 | ||||||
Senior Secured Credit Facility [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes maturity period | 5 years | |||||||
Maximum borrowing capacity | $ 125,000,000 | |||||||
Senior Secured Credit Facility [Member] | Term Loan Facility [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | 75,000,000 | $ 1,900,000 | ||||||
Interest paid | 2,300,000 | |||||||
Maximum borrowing capacity | 75,000,000 | |||||||
Aggregate principal amount | $ 71,300,000 | |||||||
Effective interest rate | 5.625% | |||||||
Senior Secured Credit Facility [Member] | Revolving Credit Facility [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | 20,000,000 | |||||||
Interest paid | $ 421,000 | |||||||
Maximum borrowing capacity | $ 50,000,000 | 50,000,000 | ||||||
Outstanding borrowing capacity amount | 10,000,000 | |||||||
Letters of credit outstanding amount | $ 0 | |||||||
Effective interest rate | 5.3125% | |||||||
Senior Secured Credit Facility [Member] | Standby Letters of Credit [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | $ 5,000,000 | |||||||
Senior Secured Credit Facility [Member] | Swingline Loan [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | $ 10,000,000 | |||||||
Collateral Financial Arrangement [Member] | Skye Lane Properties LLC [Member] | Mortgage Loan [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 12,700,000 | |||||||
Interest rate | 4.95% | |||||||
Notes maturity date | Oct. 30, 2027 | |||||||
Frequency of periodic principal and interest payments | monthly | |||||||
Payment of principal and interest | $ 670,000 | $ 670,000 | ||||||
Collateral Financial Arrangement [Member] | Skye Lane Properties LLC [Member] | Mortgage Loan [Member] | 5-year Treasury Security [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 3.10% |
Long-Term Debt - Schedule of Co
Long-Term Debt - Schedule of Company's Debt and Credit Facilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Principal amount | $ 136,051 | $ 155,757 |
Less: unamortized discount and issuance costs | 5,202 | 6,963 |
Total long-term debt | 130,849 | 148,794 |
Term Loan Facility [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount | 71,250 | 75,000 |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount | 10,000 | 20,000 |
Convertible Debt [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount | 23,413 | 29,163 |
FHLB Loan Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount | 19,200 | 19,200 |
Mortgage Loan [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount | $ 12,188 | $ 12,394 |
Long-Term Debt - Schedule of Pr
Long-Term Debt - Schedule of Principal Payments on Long-Term Debt (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Total long-term debt | $ 130,849 | $ 148,794 |
Long-term Debt Agreements [Member] | ||
Debt Instrument [Line Items] | ||
2019 remaining | 3,821 | |
2020 | 7,790 | |
2021 | 7,806 | |
2022 | 7,822 | |
2023 | 74,589 | |
Thereafter | 34,223 | |
Total long-term debt | $ 136,051 |
Accounts Payable and Other Li_3
Accounts Payable and Other Liabilities - Schedule of Accounts Payable and Other Liabilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Other Liabilities Disclosure [Abstract] | ||
Deferred ceding commission | $ 35,185 | $ 44,996 |
Outstanding claim checks | 15,360 | |
Accounts payable and other payables | 7,096 | 8,379 |
Lease obligations | 8,635 | |
Accrued interest and issuance costs | 1,476 | 1,285 |
Accrued dividends | 1,772 | 1,589 |
Premium tax | 2,241 | |
Other liabilities | 37 | 460 |
Commission payables | 12,228 | 11,654 |
Total other liabilities | $ 66,428 | $ 85,964 |
Statutory Accounting and Regu_2
Statutory Accounting and Regulations - Additional Information (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Heritage P&C [Member] | ||
Statutory Accounting Practices [Line Items] | ||
Statutory accounting practices, capital and surplus requirements of insurance subsidiary | Greater of $15 million or 10% of their respective liabilities. | |
Minimum required amount of capital and surplus maintained by the insurance subsidiary | $ 15,000,000 | |
Statutory capital and surplus requirements, percentage | 10.00% | |
Zephyr [Member] | ||
Statutory Accounting Practices [Line Items] | ||
Deposits held | $ 750,000 | |
NBIC [Member] | ||
Statutory Accounting Practices [Line Items] | ||
Statutory capital and surplus | 3,000,000 | |
Heritage P&C, Zephyr, and NBIC [Member] | ||
Statutory Accounting Practices [Line Items] | ||
Statutory capital and surplus | $ 337,300,000 | $ 376,300,000 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) | 1 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jan. 31, 2017 | Sep. 30, 2019 | Sep. 30, 2018 | |
Mrs. Shannon Lucas [Member] | ||||
Related Party Transaction [Line Items] | ||||
Consulting fees hourly rate | $ 400 | |||
Immediate Family Member of Management or Principal Owner [Member] | ||||
Related Party Transaction [Line Items] | ||||
Consulting fees | $ 256,000 | $ 575,000 | ||
Heritage P&C [Member] | Director [Member] | ||||
Related Party Transaction [Line Items] | ||||
Director annual compensation | $ 150,000 | |||
Comegys Insurance Agency, Inc. [Member] | ||||
Related Party Transaction [Line Items] | ||||
Agency commission | $ 557,700 | $ 375,550 | ||
Comegys Insurance Agency, Inc. [Member] | Chief Executive Officer [Member] | ||||
Related Party Transaction [Line Items] | ||||
Director annual compensation | $ 150,000 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Defined Contribution Plan Disclosure [Line Items] | ||||
Contribution for participating employees | $ 213,000 | $ 215,000 | $ 756,000 | $ 973,000 |
Defined Contribution Plan, Plan Name | 401(k) | |||
Medical premium cost | 611,000 | $ 1,000,000 | $ 2,400,000 | $ 2,300,000 |
Additional liability for unpaid claims | $ 391,000 | 391,000 | ||
Stop loss coverage per employee | 150,000 | |||
Defined contribution plan, aggregate limit for losses | $ 1,500,000 | |||
Defined contribution plan, aggregate stop loss commences threshold percentage | 125.00% | |||
Maximum [Member] | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Percentage of contribution on employee salary | 4.00% | |||
Defined contribution plan, aggregate limit for losses in provided amount | $ 1,000,000 | |||
First 3% of Employees [Member] | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Percentage of contribution on employee salary | 100.00% | |||
Next 2% of the Employees [Member] | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Percentage of contribution on employee salary | 50.00% |
Equity - Additional Information
Equity - Additional Information (Detail) - USD ($) | Aug. 01, 2019 | May 06, 2019 | Feb. 25, 2019 | Aug. 01, 2018 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Class Of Stock [Line Items] | |||||||||||
Common stock, shares authorized | 50,000,000 | 50,000,000 | 50,000,000 | 50,000,000 | |||||||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | 5,000,000 | ||||||||
Common stock, shares outstanding | 28,963,841 | 28,963,841 | 28,963,841 | 29,477,756 | |||||||
Treasury stock, shares | 8,036,560 | 8,036,560 | 8,036,560 | 7,214,797 | |||||||
Additional paid-in capital | $ 331,558,000 | $ 331,558,000 | $ 331,558,000 | $ 325,292,000 | |||||||
Common stock voting rights | one vote | ||||||||||
Stock repurchase program, authorized amount | $ 50,000,000 | $ 38,100,000 | $ 38,100,000 | $ 38,100,000 | |||||||
Stock repurchase program, expiration date | Dec. 31, 2020 | Dec. 31, 2020 | |||||||||
Treasury shares repurchased, shares | 316,383 | 821,763 | |||||||||
Treasury shares repurchased, value | $ 4,549,000 | $ 2,333,000 | $ 5,011,000 | $ 2,000,000 | $ 11,900,000 | ||||||
Stock repurchased in connection with vesting of restricted stock unit | 4,620 | 12,620 | |||||||||
Stock repurchased in connection with vesting of restricted stock unit, value | $ 68,000 | $ 118,000 | |||||||||
Cash dividend per common share | $ 0.06 | $ 0.06 | $ 0.06 | ||||||||
Cash dividend, payable date | Oct. 3, 2019 | Jul. 3, 2019 | Apr. 3, 2019 | ||||||||
Dividend payable, record date | Sep. 16, 2019 | Jun. 14, 2019 | Mar. 15, 2019 | ||||||||
Restricted Stock [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Unvested restricted common stock issued | 570,534 | 570,534 | 570,534 | 605,801 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | May 22, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Maximum tenure of stock option from the date of grant | 10 years | |||
Exercisable period of vested awards | 30 days | |||
Minimum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock options, vesting period | 1 year | |||
Maximum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock options, vesting period | 5 years | |||
Restricted Stock [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Restricted stock awards granted | 0 | |||
Stock-based compensation expense | $ 4,000,000 | $ 3,900,000 | ||
Unrecognized stock compensation expense | $ 6,900,000 | |||
Unrecognized stock compensation expense, weighted average period | 1 year 3 months 18 days | |||
Restricted stock vested and released | 35,267 | 0 | ||
Shares withheld to cover withholding taxes | 12,620 | |||
Shares withheld to cover withholding taxes, value | $ 186,000 | |||
Restricted Stock [Member] | Minimum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock options, vesting period | 3 years | |||
Restricted Stock [Member] | Maximum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock options, vesting period | 5 years | |||
Restricted Stock [Member] | Employee [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Restricted stock awards granted | 155,801 | |||
Restricted Stock [Member] | Employee [Member] | Minimum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock options, vesting period | 3 years | |||
Restricted Stock [Member] | Employee [Member] | Maximum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock options, vesting period | 5 years | |||
Omnibus Incentive Plan [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Common stock reserved for issuance | 2,981,737 | |||
Shares available for grant | 1,326,018 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Restricted Stock Activity (Detail) - Restricted Stock [Member] | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Beginning balance, Number of shares | 605,801 |
Granted, Number of shares | 0 |
Vested, Number of shares | (22,647) |
Canceled and surrendered, Number of shares | (12,620) |
Ending balance, Number of shares | 570,534 |
Beginning balance, Weighted-Average Grant-Date Fair Value per Share | $ / shares | $ 19.30 |
Vested, Weighted-Average Grant-Date Fair Value per Share | $ / shares | 14.28 |
Canceled and surrendered, Weighted-Average Grant-Date Fair Value per Share | $ / shares | 14.24 |
Ending balance, Weighted-Average Grant-Date Fair Value per Share | $ / shares | $ 19.61 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - $ / shares | Oct. 31, 2019 | Aug. 01, 2019 | May 06, 2019 | Feb. 25, 2019 |
Subsequent Event [Line Items] | ||||
Cash dividend per common share | $ 0.06 | $ 0.06 | $ 0.06 | |
Cash dividend, payable date | Oct. 3, 2019 | Jul. 3, 2019 | Apr. 3, 2019 | |
Dividend payable, record date | Sep. 16, 2019 | Jun. 14, 2019 | Mar. 15, 2019 | |
Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Cash dividend, declared date | Oct. 31, 2019 | |||
Cash dividend per common share | $ 0.06 | |||
Cash dividend, payable date | Jan. 3, 2020 | |||
Dividend payable, record date | Dec. 16, 2019 |