Commitments and Contingencies

12 Months Ended

Dec. 31, 2021

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

Litigation

We are involved in claims-related legal actions arising in the ordinary course of business. We accrue amounts resulting from claims-related legal actions in unpaid losses and LAE during the period that we determine an unfavorable outcome becomes probable and we can estimate the amounts. Management makes revisions to our estimates based on its analysis of subsequent information that we receive 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.

At December 31, 2021, the Company is involved in legal proceedings whereby on August 18, 2021, a former employee of Skyway Legal Services, LLC, filed a complaint against the Company in the United States District Court for the District of Delaware. The lawsuit alleges violations of and damages arising under Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967, and seeks damages in an unspecified amount. The Company, a named party to the lawsuit, denies that it employed the plaintiff and disputes the claims set forth in the lawsuit. The Company believes that an unfavorable outcome is neither probable nor estimable.

Commitments to fund partnership investments

We have fully funded three limited partnership investments and have committed to fund our remaining five limited partnership investments. The amount of unfunded commitments was $1,969,000 and $2,056,000 at December 31, 2021 and 2020, respectively.

Leases

We, as lessee, have entered into leases of commercial office space of various term lengths. In addition to office space, we lease office equipment and a parking lot under operating leases and vehicles under finance leases.

The classification of operating and finance lease asset and liability balances within the Consolidated Balance Sheets was as follows:


	Financial Statement Line	December 31, 2021		December 31, 2020
Assets
Operating lease assets	Other assets	$	1,689	$	2,168
Financing lease assets	Property and equipment, net	477		1,214
Total lease assets		$	2,166	$	3,382

Liabilities
Operating lease liabilities	Operating lease liability	$	1,934	$	2,311
Financing lease liabilities	Other liabilities	16		36
Total lease liabilities		$	1,950	$	2,347

The components of lease expenses were as follows:


	Years ended December 31,
	2021		2020
Operating lease expense	$	654	$	630
Financing lease expense:
Amortization of leased assets	758		702
Interest on lease liabilities	1		1
Short-term lease expense	—		—
Net lease expense	$	1,413	$	1,333

At December 31, 2021, future minimum gross lease payments relating to these non-cancellable operating and finance lease agreements were as follows:


	Operating Leases		Finance Leases		Total
2022	$	636	$	15	$	651
2023	619		4		623
2024	602		—		602
2025	257		—		257
2026	32		—		32
Thereafter	1,161		—		1,161
Total undiscounted future minimum lease payments	3,307		19		3,326
Less: Imputed interest	(1,373)		(3)		(1,376)
Present value of lease liabilities	$	1,934	$	16	$	1,950

Weighted average remaining lease term and discount rate related to operating and finance leases were as follows:


	December 31, 2021		December 31, 2020
Weighted average remaining lease term (months)
Operating leases	51		67
Financing leases	17		23

Weighted average discount rate
Operating leases	3.61	%	3.57	%
Financing leases	3.27	%	3.27	%

Other cash and non-cash related activities were as follows:


	Years ended December 31,
	2021		2020
Cash paid for amounts included in the measurement of lease liabilities
Investing cash flows from financing leases	$	68	$	631

Right-of-use assets obtained in exchange for new operating lease liabilities	14		2,471
Right-of-use assets obtained in exchange for new financing lease liabilities	70		652

Capital lease amortization expenses are included in depreciation expense in our Consolidated Statements of Comprehensive Loss. See Note 7 for information regarding depreciation expense. See Note 11 for information regarding commitments related to long-term debt, and Note 15 for commitments related to regulatory actions.