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Segment Reporting
 9 Months Ended
Sep. 30, 2022
Segment Reporting [Abstract]  
Segment Reporting Disclosure
3)    SEGMENT REPORTING

Personal Lines Business

Our personal lines business provides structure, content and liability coverage for standard single-family homeowners, renters and condominium unit owners, through our subsidiaries UPC and IIC. Personal residential products are offered in all states in which we write business. We include coverage to policyholders for loss or damage to dwellings, detached structures or equipment caused by covered causes of loss such as fire, wind, hail, water, theft and vandalism.

We have developed a unique and proprietary homeowners’ product. This product uses a granular approach to pricing for catastrophe perils. We have focused on using independent agencies as a channel of distribution for our personal lines business. All of our personal lines business is managed internally.

Commercial Lines Business

Our commercial lines business primarily provides commercial multi-peril property insurance for residential condominium associations and apartments in Florida, through our subsidiary ACIC. We include coverage to policyholders for loss or damage to buildings, inventory or equipment caused by covered causes of loss such as fire, wind, hail, water, theft and vandalism. We also wrote commercial residential coverage through our subsidiary JIC, in South Carolina and Texas. Effective June 1, 2022 JIC was merged into ACIC, with ACIC being the surviving entity. As a result, the commercial residential policies originally written by JIC will not be renewed effective May 31, 2022.

All of our commercial lines business is administered by an outside managing general underwriter, AmRisc, LLC (AmRisc). This includes handling the underwriting, claims processing and premium collection related to our commercial business. In return, AmRisc is reimbursed through monthly management fees. International Catastrophe Insurance Managers (ICAT) handles the underwriting and premium collection for JIC’s commercial business written in South Carolina and Texas and is also reimbursed through monthly management fees. In 2022, the Company terminated its agreement with ICAT. Termination of this agreement is effective May 31, 2022.

Please note the following similarities pertaining to the accounting and transactions of our operating segments for the three and nine months ended September 30, 2022 and 2021:

•Both operating segments follow the accounting policies as reported in our Annual Report on Form 10-K for the year ended December 31, 2021;
•Neither operating segment experienced significant noncash transactions outside of depreciation and amortization for the three and nine months ended September 30, 2022 and 2021, and the receipt of HCI common stock during the three months ended March 31, 2021, in connection with our Northeast Renewal Agreement.

The tables below present the information for each of the reportable segment's profit or loss, as well as segment assets for the three and nine months ended September 30, 2022 and 2021.
Three Months Ended September 30, 2022
Commercial
Personal (1)
AdjustmentsConsolidated
REVENUE:
Gross premiums written$76,867 $178,336 $— $255,203 
Change in gross unearned premiums42,953 3,740 — 46,693 
Gross premiums earned119,820 182,076 — 301,896 
Ceded premiums earned(60,301)(125,408)— (185,709)
Net premiums earned59,519 56,668 — 116,187 
Net investment income1,756 2,498 15 4,269 
Net realized gains (losses)— (9)— (9)
Net unrealized losses on equity securities(897)(1,621)— (2,518)
Other revenue1,178 4,678 3 5,859 
Total revenues61,556 62,214 18 123,788 
EXPENSES:
Losses and loss adjustment expenses34,229 82,999 — 117,228 
Policy acquisition costs22,430 16,514 — 38,944 
Operating expenses717 8,788 110 9,615 
General and administrative expenses (2)
2,428 23,643 320 26,391 
Interest expense— 34 2,358 2,392 
Total expenses59,804 131,978 2,788 194,570 
Income (loss) before other income 1,752 (69,764)(2,770)(70,782)
Other income (loss)10 (25)— (15)
Income (loss) before income taxes$1,762 $(69,789)(2,770)(70,797)
Benefit for income taxes87 87 
Net income (loss)$(2,857)$(70,884)
Less: Net loss attributable to noncontrolling interests— — 
Net income (loss) attributable to UIHC$(2,857)$(70,884)
Loss ratio, net (3) (4)
57.5 %146.5 %100.9 %
Expense ratio (3) (5)
43.0 %86.4 %64.5 %
Combined ratio (3) (6)
100.5 %232.9 %165.4 %
Total segment assets$1,354,893 $1,357,892 $229,342 $2,942,127 
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations.
(2) Included in our General and Administrative expenses is $15,136,000 and $673,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. Personal lines depreciation and amortization expenses includes $13,569,000 related to the impairment of goodwill.
(3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below.
(4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses.
(5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses.
(6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
Three Months Ended September 30, 2021
Commercial
Personal (1)
AdjustmentsConsolidated
REVENUE:
Gross premiums written$64,384 $258,109 $— $322,493 
Change in gross unearned premiums40,607 (9,639)— 30,968 
Gross premiums earned104,991 248,470 — 353,461 
Ceded premiums earned(61,583)(138,607)— (200,190)
Net premiums earned43,408 109,863 — 153,271 
Net investment income1,166 2,294 11 3,471 
Net realized gains (losses)(2)5,539 — 5,537 
Net unrealized losses on equity securities271 (3,564)— (3,293)
Other revenue— 3,754 — 3,754 
Total revenues44,843 117,886 11 162,740 
EXPENSES:
Losses and loss adjustment expenses8,156 94,613 — 102,769 
Policy acquisition costs23,384 23,541 — 46,925 
Operating expenses1,422 13,777 230 15,429 
General and administrative expenses (2)
1,685 11,895 360 13,940 
Interest expense— 19 2,359 2,378 
Total expenses34,647 143,845 2,949 181,441 
Income (loss) before other income 10,196 (25,959)(2,938)(18,701)
Other income (loss)— 101 — 101 
Income (loss) before income taxes$10,196 $(25,858)(2,938)(18,600)
Benefit for income taxes(3,482)(3,482)
Net income (loss)$544 $(15,118)
Less: Net loss attributable to noncontrolling interests(796)(796)
Net income (loss) attributable to UIHC$1,340 $(14,322)
Loss ratio, net (3) (4)
18.8 %86.1 %67.1 %
Expense ratio (3) (5)
61.0 %44.8 %49.8 %
Combined ratio (3) (6)
79.8 %130.9 %116.9 %
Total segment assets$1,298,042 $1,567,412 $463,132 $3,328,586 
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations.
(2) Included in our General and Administrative expenses is $1,372,000 and $876,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively.
(3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below.
(4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses.
(5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses.
(6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
Nine Months Ended September 30, 2022
Commercial
Personal (1)
AdjustmentsConsolidated
REVENUE:
Gross premiums written$385,898 $508,926 $— $894,824 
Change in gross unearned premiums(45,395)77,431 — 32,036 
Gross premiums earned340,503 586,357 — 926,860 
Ceded premiums earned(184,094)(414,317)— (598,411)
Net premiums earned156,409 172,040 — 328,449 
Net investment income4,359 5,494 34 9,887 
Net realized gains (losses)(77)(1,779)— (1,856)
Net unrealized losses on equity securities(4,056)(5,812)(2)(9,870)
Other revenue1,178 14,156 3 15,337 
Total revenues157,813 184,099 35 341,947 
EXPENSES:
Losses and loss adjustment expenses56,537 242,133 — 298,670 
Policy acquisition costs59,036 34,912 — 93,948 
Operating expenses2,953 31,641 288 34,882 
General and administrative expenses (2)
7,169 48,518 1,203 56,890 
Interest expense— 85 7,080 7,165 
Total expenses125,695 357,289 8,571 491,555 
Income (loss) before other income 32,118 (173,190)(8,536)(149,608)
Other income (loss)12 (80)1,667 1,599 
Income (loss) before income taxes$32,130 $(173,270)(6,869)(148,009)
Benefit for income taxes25,187 25,187 
Net income (loss)$(32,056)$(173,196)
Less: Net loss attributable to noncontrolling interests(111)(111)
Net income (loss) attributable to UIHC$(31,945)$(173,085)
Loss ratio, net (3) (4)
36.1 %140.7 %90.9 %
Expense ratio (3) (5)
44.2 %66.9 %56.5 %
Combined ratio (3) (6)
80.3 %207.6 %147.4 %
Total segment assets$1,354,893 $1,357,892 $229,342 $2,942,127 
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations.
(2) Included in our General and Administrative expenses is $18,005,000 and $2,435,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively. Personal lines depreciation and amortization expenses includes $13,569,000 related to the impairment of goodwill.
(3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below.
(4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses.
(5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses.
(6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
Nine Months Ended September 30, 2021
Commercial
Personal (1)
AdjustmentsConsolidated
REVENUE:
Gross premiums written$328,406 $732,149 $— $1,060,555 
Change in gross unearned premiums(23,639)29,641 — 6,002 
Gross premiums earned304,767 761,790 — 1,066,557 
Ceded premiums earned(176,678)(445,199)— (621,877)
Net premiums earned128,089 316,591 — 444,680 
Net investment income3,538 7,165 34 10,737 
Net realized gains(34)5,950 — 5,916 
Net unrealized losses on equity securities627 1,082 — 1,709 
Other revenue— 16,941 — 16,941 
Total revenues132,220 347,729 34 479,983 
EXPENSES:
Losses and loss adjustment expenses40,330 296,284 — 336,614 
Policy acquisition costs59,238 69,835 — 129,073 
Operating expenses3,623 38,240 270 42,133 
General and administrative expenses (2)
5,327 36,190 1,417 141742,934 
Interest expense— 66 6,944 7,010 
Total expenses108,518 440,615 8,631 557,764 
Income (loss) before other income 23,702 (92,886)(8,597)(77,781)
Other income— 126 — 126 
Income (loss) before income taxes$23,702 $(92,760)(8,597)(77,655)
Benefit for income taxes(20,656)(20,656)
Net income (loss)$12,059 $(56,999)
Less: Net income attributable to noncontrolling interests(1,396)(1,396)
Net income (loss) attributable to UIHC$13,455 $(55,603)
Loss ratio, net (3) (4)
31.5 %93.6 %75.7 %
Expense ratio (3) (5)
53.2 %45.6 %48.2 %
Combined ratio (3) (6)
84.7 %139.2 %123.9 %
Total segment assets$1,298,042 $1,567,412 $463,132 $3,328,586 
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations.
(2) Included in our General and Administrative expenses is $5,537,000 and $2,509,000 of depreciation and amortization expense related to our personal and commercial lines assets, respectively.
(3) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below.
(4) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses.
(5) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses.
(6) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.