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Income taxes (Tables)

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Components of Income Tax Expense (Benefit), Continuing Operations

For the years ended December 31, 2020, 2019 and 2018, the Company recorded income tax expense (benefit), as follows:

			2020						2019						2018
Income tax expense (benefit) related to U.S. and U.K. subsidiaries			$	8,040					$	713					$	(10,035)
Change in uncertain tax positions			68						—						(300)
Withholding taxes on certain investment transactions (1)			—						—						6,325
			$	8,108					$	713					$	(4,010)

(1)Prior to the change in the Company’s investment account structure, the Company was subject to withholding taxes on income sourced in the United States and in other countries, subject to each countries’ specific tax regulations. Income subject to withholding taxes included, but is not limited to, dividends, capital gains and interest on certain investments.

The following table presents the Company’s current and deferred incomes taxes for the years ended December 31, 2020, 2019 and 2018:

			2020						2019						2018
Current tax expense			$	145					$	54					$	6,025
Deferred tax expense (benefit)			7,963						659						(10,035)
			$	8,108					$	713					$	(4,010)

Schedule of Income before Income Tax, Domestic and Foreign

The following is a summary of the Company’s income (loss) before income tax expense (benefit) by jurisdiction for the years ended December 31, 2020, 2019 and 2018:

			2020						2019						2018
Bermuda			$	113,646					$	197,973					$	(273,697)
United States			38,159						3,245						(47,771)
United Kingdom			161						114						(11)
			$	151,966					$	201,332					$	(321,479)

Schedule of Effective Income Tax Rate Reconciliation

The following table presents a reconciliation of expected income taxes to income tax expense (benefit) for the years ended December 31, 2020, 2019 and 2018:

			2020						2019						2018
Bermuda (expected tax expense at 0%)			$	—					$	—					$	—
Foreign taxes at local expected rates:
United States			8,013						681						(10,032)
United Kingdom			31						22						(2)
Withholding taxes related to dividend and interest income			—						—						6,325
Uncertain tax positions			68						—						(300)
Non-deductible expenses and other			(4)						10						(1)
			$	8,108					$	713					$	(4,010)

Schedule of Deferred Tax Assets and Liabilities

The following table presents the tax effects of temporary differences that give rise to the deferred tax assets and deferred tax liabilities as of December 31, 2020, 2019 and 2018:

			2020						2019						2018
Deferred tax assets:
Discounting of loss and loss adjustment expense reserves			$	1,027					$	786					$	534
Unearned premiums			5,543						1,774						1,567
Temporary differences in recognition of expenses			2,462						1,208						1,247
Net operating loss carryforward			10,131						9,282						6,798
Total deferred tax assets			19,163						13,050						10,146
Deferred tax liabilities:
Deferred acquisition costs			8,276						1,379						1,490
Unrealized gains (losses) on investments			10,474						3,366						(405)
Total deferred tax liabilities			18,750						4,745						1,085
Net deferred tax assets			$	413					$	8,305					$	9,061

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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