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Investments

6 Months Ended

Jun. 30, 2024

Investments, Debt and Equity Securities [Abstract]

Investments

2. Investments

The amortized cost and fair value of fixed maturities securities and short-term investments are as follows (in millions):

			June 30, 2024
			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
Fixed maturities available-for-sale:
U.S. government and agencies			$	17.6					$	—					$	(0.2)					$	17.4
States and other territories			8.4						—						(0.4)						8.0
Corporate securities			100.7						0.5						(1.4)						99.8
Foreign securities			0.9						—						—						0.9
Residential mortgage-backed securities			19.7						—						(1.6)						18.1
Commercial mortgage-backed securities			7.6						—						(0.4)						7.2
Asset backed securities			15.7						—						(0.1)						15.6
Total fixed maturities available-for-sale			170.6						0.5						(4.1)						167.0
Short-term investments:
U.S. government and agencies			103.8						—						—						103.8
Commercial paper			19.4						—						—						19.4
Corporate securities			25.3						—						—						25.3
Total short-term investments			148.5						—						—						148.5
Total			$	319.1					$	0.5					$	(4.1)					$	315.5

			December 31, 2023
			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
Fixed maturities available-for-sale:
U.S. government and agencies			$	18.6					$	—					$	(0.2)					$	18.4
States and other territories			9.3						—						(0.4)						8.9
Corporate securities			91.3						1.1						(1.3)						91.1
Foreign securities			0.9						—						—						0.9
Residential mortgage-backed securities			20.7						0.1						(1.3)						19.5
Commercial mortgage-backed securities			7.7						—						(0.6)						7.1
Asset backed securities			16.1						—						(0.3)						15.8
Total fixed maturities available-for-sale			164.6						1.2						(4.1)						161.7
Short-term investments:
U.S. government and agencies			137.7						—						—						137.7
Commercial paper			34.5						—						—						34.5
Corporate securities			14.9						—						—						14.9
Total short-term investments			187.1						—						—						187.1
Total			$	351.7					$	1.2					$	(4.1)					$	348.8

The following tables present the gross unrealized losses and related fair values for the Company’s investments in available-for-sale debt securities and short-term investments, grouped by duration of time in a continuous unrealized loss position as of June 30, 2024, and December 31, 2023 (in millions):

			June 30, 2024
			Less than 12 months												12 months or more												Total
			Fair Value						Gross Unrealized Losses						Fair Value						Gross Unrealized Losses						Fair Value						Gross Unrealized Losses
Fixed maturities available-for-sale:
U.S. government and agencies			$	9.0					$	(0.1)					$	5.9					$	(0.1)					$	14.9					$	(0.2)
States and other territories			0.2						—						7.5						(0.4)						7.7						(0.4)
Corporate securities			46.9						(0.3)						5.9						(1.1)						52.8						(1.4)
Foreign securities			—						—						4.0						—						4.0						—
Residential mortgage-backed securities			4.7						(0.1)						10.7						(1.5)						15.4						(1.6)
Commercial mortgage-backed securities			0.4						—						5.9						(0.4)						6.3						(0.4)
Asset backed securities			1.8						—						7.7						(0.1)						9.5						(0.1)
Short-term investments:
U.S. government and agencies			5.2						—						—						—						5.2						—
Commercial paper			19.4						—						—						—						19.4						—
Corporate securities			13.2						—						—						—						13.2						—
Total			$	100.8					$	(0.5)					$	47.6					$	(3.6)					$	148.4					$	(4.1)

			December 31, 2023
			Less than 12 months												12 months or more												Total
			Fair Value						Gross Unrealized Losses						Fair Value						Gross Unrealized Losses						Fair Value						Gross Unrealized Losses
Fixed maturities available-for-sale:
U.S. government and agencies			$	4.3					$	—					$	10.5					$	(0.2)					$	14.8					$	(0.2)
States and other territories			1.5						—						7.4						(0.4)						8.9						(0.4)
Corporate securities			5.7						—						37.4						(1.3)						43.1						(1.3)
Foreign securities			—						—						0.9						—						0.9						—
Residential mortgage-backed securities			—						—						11.6						(1.3)						11.6						(1.3)
Commercial mortgage-backed securities			0.4						—						5.8						(0.6)						6.2						(0.6)
Asset backed securities			1.6						—						8.2						(0.3)						9.8						(0.3)
Short-term investments:
U.S. government and agencies			137.7						—						—						—						137.7						—
Commercial paper			34.5						—						—						—						34.5						—
Corporate securities			14.9						—						—						—						14.9						—
Total			$	200.6					$	—					$	81.8					$	(4.1)					$	282.4					$	(4.1)

The Company has determined that unrealized losses as of June 30, 2024 and December 31, 2023 resulted from the interest rate environment, rather than a deterioration of the creditworthiness of the issuers. Therefore, an allowance for credit losses was not necessary as it is more likely than not that the Company will not be required to sell the investments before the recovery of the amortized cost basis or until maturity. As of June 30, 2024, none of the Company’s fixed maturity portfolio was unrated or rated below investment grade.

The amortized cost and fair value of fixed maturities securities by contractual maturity are as follows (in millions):

			June 30, 2024
			Amortized Cost						Fair Value
Due to mature:
One year or less			$	31.4					$	31.0
After one year through five years			77.2						75.9
After five years			12.5						12.3
After ten years			6.5						6.9
Residential mortgage-backed securities			19.7						18.1
Commercial mortgage-backed securities			7.6						7.2
Asset backed securities			15.7						15.6
Total fixed maturities available-for-sale			$	170.6					$	167.0

Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

Net realized gains and losses on fixed maturity securities were insignificant for the three and six months ended June 30, 2024 and 2023, respectively.

The Company’s net investment income is comprised of the following (in millions):

			Three Months Ended June 30,												Six Months Ended June 30,
			2024						2023						2024						2023
Interest on cash and cash equivalents			$	2.8					$	1.3					$	5.0					$	2.5
Fixed maturities income			1.9						1.2						3.7						2.6
Short-term investment income			1.5						3.0						3.5						6.0
Total gross investment income			6.2						5.5						12.2						11.1
Investment expenses			(0.1)						(0.1)						(0.2)						(0.3)
Net investment income			$	6.1					$	5.4					$	12.0					$	10.8

Pursuant to certain regulatory requirements, the Company is required to hold assets on deposit with various state insurance departments for the benefit of policyholders. These special deposits are included in cash and cash equivalents, fixed maturities, or short-term investments on the condensed consolidated balance sheets. The carrying value of securities on deposit with state regulatory authorities total $13.6 million and $12.9 million as of June 30, 2024 and December 31, 2023, respectively.

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- References

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- Definition

The entire disclosure for investments in certain debt and equity securities.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 940
-SubTopic 320
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/940-320/tableOfContent

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Name Regulation S-K (SK)
-Number 229
-Section 1403
-Paragraph b
-Publisher SEC

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 320
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/320/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481800/320-10-50-10

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6B
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-6B

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6B
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-6B

Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 942
-SubTopic 320
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/942-320/tableOfContent

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