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Reserve for Losses and Loss Adjustment Expenses | 3 Months Ended
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Mar. 31, 2024
Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract] |
Reserve for Losses and Loss Adjustment Expenses | Reserve for Losses and Loss Adjustment Expenses The following table provides a reconciliation of the beginning and ending reserve balances for losses and loss adjustment expenses (“LAE”) for the three months ended March 31:
(In thousands) |  | 2024 |  | 2023
Reserve for losses and LAE at beginning of period |  | $ | 260,095 |  |  | $ | 216,464 |
Less: Reinsurance recoverables |  | 24,104 |  |  | 14,618 |
Net reserve for losses and LAE at beginning of period |  | 235,991 |  |  | 201,846 |
Add provision for losses and LAE, net of reinsurance, occurring in: |  |  |  |
Current period |  | 39,396 |  |  | 32,694 |
Prior years |  | (29,483) |  |  | (32,874) |
Net incurred losses and LAE during the current period |  | 9,913 |  |  | (180) |
Deduct payments for losses and LAE, net of reinsurance, occurring in: |  |  |  |
Current period |  | 404 |  |  | — |
Prior years |  | 4,846 |  |  | 2,001 |
Net loss and LAE payments during the current period |  | 5,250 |  |  | 2,001 |
Net reserve for losses and LAE at end of period |  | 240,654 |  |  | 199,665 |
Plus: Reinsurance recoverables |  | 26,670 |  |  | 16,357 |
Reserve for losses and LAE at end of period |  | $ | 267,324 |  |  | $ | 216,022 |
For the three months ended March 31, 2024, $4.8 million was paid for incurred claims and claim adjustment expenses attributable to insured events of prior years. There has been a $29.5 million favorable prior year development during the three months ended March 31, 2024. Reserves remaining as of March 31, 2024 for prior years are $201.7 million as a result of re-estimation of unpaid losses and loss adjustment expenses. For the three months ended March 31, 2023, $2.0 million was paid for incurred claims and claim adjustment expenses attributable to insured events of prior years. There was a $32.9 million favorable prior year development during the three months ended March 31, 2023. Reserves remaining as of March 31, 2023 for prior years were $167.0 million as a result of re-estimation of unpaid losses and loss adjustment expenses. In both periods, the favorable prior years' loss development was the result of a re-estimation of amounts ultimately to be paid on prior year defaults in the default inventory, including the impact of previously identified defaults that cured. Original estimates are increased or decreased as additional information becomes known regarding individual claims. The Federal Reserve increased the target federal funds rate several times during 2022 and 2023 in an effort to reduce consumer price inflation. These rate increases have resulted in higher mortgage interest rates which may lower home sale activity and affect the options available to delinquent borrowers. It is reasonably possible that our estimate of losses could change in the near term as a result of changes in the economic environment, the impact of elevated mortgage interest rates on home sale activity, housing inventory and home prices.

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- References No definition available. + Details
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- Definition The entire disclosure for liabilities related to future policy benefits and unpaid claims and claim adjustments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 944 -SubTopic 40 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//944-40/tableOfContent + Details
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