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Segment Reporting
 6 Months Ended
Jun. 30, 2023
Segment Reporting [Abstract]  
Segment Reporting Disclosure )    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 subsidiary IIC. Personal residential products are offered in New York. 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 AmCoastal. 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 AmCoastal, with AmCoastal being the surviving entity. As a result, the commercial residential policies originally written by JIC were not 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) handled the underwriting and premium collection for JIC’s commercial business written in South Carolina and Texas and was also reimbursed through monthly management fees. Effective May 31, 2022, the Company terminated its agreement with ICAT.

Please note the following similarities pertaining to the accounting and transactions of our operating segments for the three and six months ended June 30, 2023 and 2022:

•Both operating segments follow the accounting policies as reported in our Annual Report on Form 10-K for the year ended December 31, 2022;
•Neither operating segment experienced significant noncash transactions outside of depreciation and amortization for the three and six months ended June 30, 2023 and 2022.
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 six months ended June 30, 2023 and 2022. We have restated our segments to reflect the discontinued operations disclosed in Note 3, excluding the result of the entity for all periods presented.


Three Months Ended June 30, 2023
Commercial
Personal (1)
AdjustmentsConsolidated
REVENUE:
Gross premiums written$236,822 $7,063 $— $243,885 
Change in gross unearned premiums(91,011)5,325 — (85,686)
Gross premiums earned145,811 12,388 — 158,199 
Ceded premiums earned(71,825)(3,205)— (75,030)
Net premiums earned73,986 9,183 — 83,169 
Net investment income1,866 804 22 2,692 
Net realized gains (losses)(6,708)(17)— (6,725)
Net unrealized losses on equity securities140 — 1 141 
Other revenue— 18 — 18 
Total revenues69,284 9,988 23 79,295 
EXPENSES:
Losses and loss adjustment expenses16,245 4,670 — 20,915 
Policy acquisition costs23,526 2,019 — 25,545 
Operating expenses1,501 1,669 104 3,274 
General and administrative expenses (2)
2,631 3,772 180 6,583 
Interest expense— — 2,719 2,719 
Total expenses43,903 12,130 3,003 59,036 
Income (loss) before other income 25,381 (2,142)(2,980)20,259 
Other income (loss)— 806 — 806 
Income (loss) before income taxes$25,381 $(1,336)(2,980)21,065 
Provision for income taxes713 713 
Net income (loss)$(3,693)$20,352 
Less: Net loss attributable to noncontrolling interests— — 
Net income (loss) attributable to ACIC$(3,693)$20,352 
Loss ratio, net (3) (4)
22.0 %50.9 %25.1 %
Expense ratio (3) (5)
37.4 %81.2 %42.6 %
Combined ratio (3) (6)
59.4 %132.1 %67.7 %
Total segment assets$1,612,469 $(233,324)$53,605 $1,432,750 
(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 $996,000 and $811,000 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.
Three Months Ended June 30, 2022
Commercial
Personal (1)
AdjustmentsConsolidated
REVENUE:
Gross premiums written$181,067 $26,565 $— $207,632 
Change in gross unearned premiums(67,849)(10,300)— (78,149)
Gross premiums earned113,218 16,265 — 129,483 
Ceded premiums earned(61,771)(3,180)— (64,951)
Net premiums earned51,447 13,085 — 64,532 
Net investment income1,476 353 10 1,839 
Net realized gains (losses)(79)2 — (77)
Net unrealized losses on equity securities(2,390)— (1)(2,391)
Other revenue— 7 — 7 
Total revenues50,454 13,447 9 63,910 
EXPENSES:
Losses and loss adjustment expenses8,194 5,838 — 14,032 
Policy acquisition costs19,928 3,642 — 23,570 
Operating expenses1,127 2,606 87 3,820 
General and administrative expenses (2)
2,421 5,285 502 8,208 
Interest expense— — 2,363 2,363 
Total expenses31,670 17,371 2,952 51,993 
Income (loss) before other income 18,784 (3,924)(2,943)11,917 
Other income (loss)2 199 57 258 
Income (loss) before income taxes$18,786 $(3,725)(2,886)12,175 
Provision for income taxes25,486 25,486 
Net income (loss)$(28,372)$(13,311)
Less: Net loss attributable to noncontrolling interests(26)(26)
Net income (loss) attributable to ACIC$(28,346)$(13,285)
Loss ratio, net (3) (4)
15.9 %44.6 %21.7 %
Expense ratio (3) (5)
45.6 %88.1 %55.2 %
Combined ratio (3) (6)
61.5 %132.7 %76.9 %
Total segment assets$1,352,713 $(471,806)$304,824 $1,185,731 
(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 $1,047,000 and $877,000 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.
Six Months Ended June 30, 2023
Commercial
Personal (1)
AdjustmentsConsolidated
REVENUE:
Gross premiums written$413,463 $17,545 $— $431,008 
Change in gross unearned premiums(135,618)7,285 — (128,333)
Gross premiums earned277,845 24,830 — 302,675 
Ceded premiums earned(125,199)(6,983)— (132,182)
Net premiums earned152,646 17,847 — 170,493 
Net investment income3,652 1,586 43 5,281 
Net realized gains (losses)(6,791)(17)— (6,808)
Net unrealized losses on equity securities613 — 2 615 
Management fee income— — — — 
Other revenue— 34 — 34 
Total revenues150,120 19,450 45 169,615 
EXPENSES:
Losses and loss adjustment expenses30,146 7,181 — 37,327 
Policy acquisition costs48,692 3,825 — 52,517 
Operating expenses1,597 3,617 228 5,442 
General and administrative expenses (2)
5,385 9,679 312 15,376 
Interest expense— — 5,438 5,438 
Total expenses85,820 24,302 5,978 116,100 
Income (loss) before other income 64,300 (4,852)(5,933)53,515 
Other income (loss)— 1,609 (215)1,394 
Income (loss) before income taxes$64,300 $(3,243)(6,148)54,909 
Provision for income taxes4,190 4,190 
Net income (loss)$(10,338)$50,719 
Less: Net loss attributable to noncontrolling interests— — 
Net income (loss) attributable to ACIC$(10,338)$50,719 
Loss ratio, net (3) (4)
19.7 %40.2 %21.9 %
Expense ratio (3) (5)
36.5 %95.9 %43.0 %
Combined ratio (3) (6)
56.2 %136.1 %64.9 %
Total segment assets$1,612,469 $(233,324)$53,605 $1,432,750 
(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 $2,003,000 and $1,623,000 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.
Six Months Ended June 30, 2022
Commercial
Personal (1)
AdjustmentsConsolidated
REVENUE:
Gross premiums written$309,031 $41,015 $— $350,046 
Change in gross unearned premiums(88,348)(9,482)— (97,830)
Gross premiums earned220,683 31,533 — 252,216 
Ceded premiums earned(123,793)(6,145)— (129,938)
Net premiums earned96,890 25,388 — 122,278 
Net investment income2,603 621 19 3,243 
Net realized gains(77)37 — (40)
Net unrealized losses on equity securities(3,159)— (2)(3,161)
Management fee income— — 
Other revenue— 22 — 22 
Total revenues96,257 26,068 17 122,342 
EXPENSES:
Losses and loss adjustment expenses22,308 18,039 — 40,347 
Policy acquisition costs36,606 7,272 — 43,878 
Operating expenses2,236 5,113 178 7,527 
General and administrative expenses (2)
4,741 10,648 883 16,272 
Interest expense— — 4,722 4,722 
Total expenses65,891 41,072 5,783 112,746 
Income (loss) before other income 30,366 (15,004)(5,766)9,596 
Other income2 (78)1,667 1,591 
Income (loss) before income taxes$30,368 $(15,082)(4,099)11,187 
Provision for income taxes24,771 24,771 
Net income (loss)$(28,870)$(13,584)
Less: Net income attributable to noncontrolling interests(111)(111)
Net income (loss) attributable to ACIC$(28,759)$(13,473)
Loss ratio, net (3) (4) (7)
23.0 %71.1 %33.0 %
Expense ratio (3) (5) (7)
45.0 %90.7 %55.3 %
Combined ratio (3) (6) (7)
68.0 %161.8 %88.3 %
Total segment assets$1,352,713 $(471,806)$304,824 $1,185,731 
(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 $2,121,000 and $1,762,000 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.