COVID-19 Impact - The company has not experienced a material impact from COVID-19 on its business operations or financial position as of September 30, 2021[34]. - There were no material claims or significant disruptions to the business for the three and nine months ended September 30, 2021[35]. - The company continues to respond to the COVID-19 pandemic and is taking measures to ensure uninterrupted service to customers[35]. - The company has not experienced a material impact from COVID-19 on its business operations or financial position as of September 30, 2021[146]. Financial Performance - Net investment income for the three months ended September 30, 2021, was $3,471 million, compared to $6,010 million for the same period in 2020[47]. - Total revenues for the three months ended September 30, 2021, were $162,740, a decline of 23.5% compared to $212,733 for the same period in 2020[150]. - Consolidated net income attributable to UIHC for the three months ended September 30, 2021, was a loss of $14,322, compared to a loss of $74,072 for the same period in 2020[150]. - The book value per share decreased to $7.42 from $10.54 year-over-year[149]. - The loss ratio for the three months ended September 30, 2021, was 67.1%, significantly improved from 115.8% for the same period in 2020[150]. - The combined ratio for the three months ended September 30, 2021, was 116.9%, down from 164.8% for the same period in 2020[150]. - Core income loss per diluted share for the three months ended September 30, 2021, was $(0.36), compared to $(1.95) for the same period in 2020[149]. - The company reported a total stock-based compensation expense of $495,000 for the nine months ended September 30, 2021, compared to $582,000 for the same period in 2020, reflecting a decrease of approximately 15%[129]. - The company incurred $336,614 in total losses during the nine months ended September 30, 2021, compared to $423,182 in the same period of 2020, reflecting a decrease of 20.5%[90]. Investment Portfolio - Total fixed maturities as of September 30, 2021, amounted to $884,940 million, with a gross unrealized loss of $11,073 million[41]. - The estimated fair value of total equity securities as of September 30, 2021, was $29,407 million, representing a significant increase from $7,445 million as of December 31, 2020[42]. - The fair value of total investments as of September 30, 2021, was $922,765 million, with $884,940 million classified as fixed maturities[60]. - The company holds 646 fixed maturities securities, with a gross unrealized loss of $10,804 million, indicating a significant portion of its portfolio is underperforming[52]. - The fair value of U.S. government and agency securities was $102,216 million as of September 30, 2021, down from $130,425 million at December 31, 2020[60]. - Approximately 85.8% of fixed maturities were U.S. Treasuries or corporate bonds rated "A" or better as of September 30, 2021[162]. - The company decreased its equity portfolio from 9.1% of total invested assets at June 30, 2020, to 0.6% at December 31, 2020, and began increasing investments in equities in Q1 2021[163]. Reinsurance and Losses - During the nine months ended September 30, 2021, the company ceded $91,127,000 in reinsurance, incurring reinstatement premiums of $14,732,000 due to Winter Storm Uri[83]. - The company’s excess of loss treaty provides coverage for catastrophe losses up to approximately $2,900,000,000, with a maximum retention of $31,000,000[82]. - Reinsurance recoverable on unpaid losses increased to $1,153,799 as of September 30, 2021, compared to $674,746 on December 31, 2020, reflecting a significant rise of 70.8%[88]. - The total reserve for unpaid losses and loss adjustment expenses (LAE) at September 30, 2021, was $1,509,477, up from $1,082,126 at the end of 2020, indicating a growth of 39.4%[90]. - The net balance for unpaid losses decreased to $355,678 as of September 30, 2021, from $380,411 in the previous year, a decline of 6.5%[90]. - The company experienced adverse development in 2021 related to prior year losses due to increased litigation claims in Florida, leading to higher loss payments compared to the previous year[92]. - Catastrophe losses incurred for named and numbered storms during the three months ended September 30, 2021, totaled $30,925,000, with a combined ratio impact of 20.1%[172]. Regulatory Compliance and Governance - The company met all regulatory requirements for its insurance subsidiaries as of September 30, 2021[118]. - The company was in compliance with the financial covenants of its Senior Notes as of September 30, 2021[99]. - The company has implemented processes and controls to ensure the appropriate valuation of its assets and liabilities[62]. Shareholder Actions - The company declared a quarterly cash dividend of $0.06 per share payable on November 29, 2021, to stockholders of record on November 22, 2021[137]. - As of September 30, 2021, the company had not repurchased any shares under the $25,000,000 stock repurchase plan authorized in July 2019[125]. Policy and Premiums - Gross premiums written for the three months ended September 30, 2021, were $322,493, a decrease of 11.8% from $365,819 for the same period in 2020[148]. - Net premiums earned for the nine months ended September 30, 2021, were $444,680, down 21.4% from $565,819 for the same period in 2020[148]. - The number of policies in-force decreased by 18.0% from 641,633 policies at September 30, 2020, to 525,969 policies at September 30, 2021[143]. - Total new and renewal policies written decreased by 21.5% to 408,631 for the nine months ended September 30, 2021, down from 520,654 in the same period in 2020[191]. Expenses and Cash Flow - Total expenses for Q3 2021 decreased by $131,863,000, or 42.1%, to $181,441,000 from $313,304,000 in Q3 2020, primarily due to a decrease in loss and LAE expenses[182]. - Operating expenses increased by $3,969,000, or 10.4%, to $42,133,000, primarily due to increased investments in technology[197]. - General and administrative expenses decreased by $10,712,000, or 20.0%, to $42,934,000, mainly due to a reduction in salary-related expenses[197]. - The company experienced cash outflows of $109,573,000 during the nine months ended September 30, 2021, compared to cash inflows of $164,592,000 in the same period in 2020[204].
United Insurance(ACIC) - 2021 Q3 - Quarterly Report