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Fair Value Measurements | 12 Months Ended
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Dec. 31, 2025
Fair Value Disclosures [Abstract] |
Fair Value Measurements | 7. FAIR VALUE MEASUREMENTS The Fair Value Measurement Topic of the ASC establishes a framework for measuring fair value and disclosures about fair value measurements. Fair Value Hierarchy The Fair Value Measurement Topic of the ASC specifies a fair value hierarchy based on whether the inputs to valuation techniques used to measure fair value are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect Company-based assumptions. The fair value hierarchy has three broad levels as follows:
l | Level 1 |  | Quoted prices for identical instruments in active markets. Assets and liabilities classified as Level 1 include US Treasury and other foreign government obligations traded in highly liquid and transparent markets, and money market funds.
l | Level 2 |  | Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Assets and liabilities classified as Level 2 generally include investments in fixed maturity securities and certain derivatives valued using only market observable data.
l | Level 3 |  | Model derived valuations in which one or more significant inputs or significant value drivers are unobservable. This hierarchy requires the use of observable market data when available. Financial instruments classified as Level 3 include certain investments in fixed maturity securities, loans and derivatives.
The Fair Value Measurement Topic of the ASC permits, as a practical expedient, the estimation of fair value of certain investments in funds using the net asset value per share of the investment or its equivalent (“NAV”). Investments in funds valued using NAV are not categorized as Level 1, 2 or 3 under the fair value hierarchy. The Investments — Equity Securities Topic of the ASC permits the measurement of certain equity securities without a readily determinable fair value at cost, less impairment, and adjusted to fair value when observable price changes in identical or similar investments from the same issuer occur (the "measurement alternative"). The fair values of investments measured under this measurement alternative are not included in the below disclosures of fair value of financial instruments. The following table sets forth the carrying amount and fair value of Octave’s financial assets and liabilities as of December 31, 2025 and 2024, including the level within the fair value hierarchy at which fair value measurements are categorized. As required by the Fair Value Measurement Topic of the ASC, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.
|  | December 31, 2025: |  | December 31, 2024:
|  | Carrying Amount |  | Total Fair Value |  | Fair Value Measurements Categorized as: |  | Carrying Amount |  | Total Fair Value |  | Fair Value Measurements Categorized as:
Level 1 |  | Level 2 |  | Level 3 |  | Level 1 |  | Level 2 |  | Level 3
Financial assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed maturity securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Municipal obligations |  | $ | 11,590 |  |  | $ | 11,590 |  |  | $ | — |  |  | $ | 11,590 |  |  | $ | — |  |  | $ | 14,083 |  |  | $ | 14,083 |  |  | $ | — |  |  | $ | 14,083 |  |  | $ | — |
Corporate obligations |  | 66,573 |  |  | 66,573 |  |  | — |  |  | 66,573 |  |  | — |  |  | 89,192 |  |  | 89,192 |  |  | — |  |  | 89,192 |  |  | — |
U.S. government obligations |  | 35,424 |  |  | 35,424 |  |  | 35,424 |  |  | — |  |  | — |  |  | 40,995 |  |  | 40,995 |  |  | 40,995 |  |  | — |  |  | — |
Residential mortgage-backed securities |  | 1,597 |  |  | 1,597 |  |  | — |  |  | 1,597 |  |  | — |  |  | 2,446 |  |  | 2,446 |  |  | — |  |  | 2,446 |  |  | — |
Commercial mortgage-backed securities |  | 3,341 |  |  | 3,341 |  |  | — |  |  | 3,341 |  |  | — |  |  | 2,101 |  |  | 2,101 |  |  | — |  |  | 2,101 |  |  | — |
Collateralized debt obligations |  | 1,975 |  |  | 1,975 |  |  | — |  |  | 1,975 |  |  | — |  |  | 3,142 |  |  | 3,142 |  |  | — |  |  | 3,142 |  |  | — |
Other asset-backed securities |  | 1,795 |  |  | 1,795 |  |  | — |  |  | 1,795 |  |  | — |  |  | 5,061 |  |  | 5,061 |  |  | — |  |  | 5,061 |  |  | — |
Fixed maturity securities, pledged as collateral: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Short term investments |  | 146,442 |  |  | 146,442 |  |  | 146,442 |  |  | — |  |  | — |  |  | 127,601 |  |  | 127,601 |  |  | 127,601 |  |  | — |  |  | — |
Other investments (1) |  | 24,971 |  |  | 7,454 |  |  | — |  |  | — |  |  | — |  |  | 28,294 |  |  | 7,499 |  |  | — |  |  | — |  |  | — |
Cash, cash equivalents and restricted cash |  | 68,440 |  |  | 68,440 |  |  | 68,440 |  |  | — |  |  | — |  |  | 47,275 |  |  | 47,275 |  |  | 47,275 |  |  | — |  |  | — |
Other assets-Loans |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 3,434 |  |  | 3,434 |  |  | — |  |  | — |  |  | 3,434 |
Total financial assets |  | $ | 362,148 |  |  | $ | 344,631 |  |  | $ | 250,306 |  |  | $ | 86,871 |  |  | $ | — |  |  | $ | 363,624 |  |  | $ | 342,829 |  |  | $ | 215,871 |  |  | $ | 116,025 |  |  | $ | 3,434 |
Financial liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Short-term debt, including accrued interest |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 152,560 |  |  | $ | 152,560 |  |  | $ | — |  |  | $ | — |  |  | $ | 152,560 |
Long term debt, including accrued interest |  | 118,901 |  |  | 121,343 |  |  | — |  |  | — |  |  | 121,343 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Derivative liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
FX forward contracts |  | 8 |  |  | 8 |  |  | — |  |  | 8 |  |  | — |  |  | 317 |  |  | 317 |  |  | — |  |  | 317 |  |  | — |
Total financial liabilities |  | $ | 118,909 |  |  | $ | 121,351 |  |  | $ | — |  |  | $ | 8 |  |  | $ | 121,343 |  |  | $ | 152,877 |  |  | $ | 152,877 |  |  | $ | — |  |  | $ | 317 |  |  | $ | 152,560 |
(1)Excluded from the fair value measurement categories in the table above are investment funds of $7,454 and $7,499 as of December 31, 2025 and 2024, respectively, which are measured using NAV as a practical expedient. Also excluded from the fair value measurements in the table above are equity securities with a carrying value of $17,517 and $20,618 as of December 31, 2025 and 2024, respectively, that do not have readily determinable fair values and have carrying amounts determined using the measurement alternative. Determination of Fair Value When available, Octave uses quoted active market prices specific to the financial instrument to determine fair value and classifies such items within Level 1. The determination of fair value for financial instruments categorized in Level 2 or 3 involves judgment due to the complexity of factors contributing to the valuation. Third-party sources from which we obtain independent market quotes also use assumptions, judgments and estimates in determining financial instrument values and different third parties may use different methodologies or provide different values for financial instruments. In addition, the use of internal valuation models may require assumptions about hypothetical or inactive markets. As a result of these factors, the actual trade value of a financial instrument in the market, or exit value of a financial instrument position by Octave, may be significantly different from its recorded fair value. Octave’s financial instruments carried at fair value are mainly comprised of investments in fixed maturity securities, equity interests in pooled investment funds, and derivative instruments. Valuation of financial instruments is performed by Octave’s finance group using methods approved by senior financial management with consultation from risk management and third-party portfolio managers as appropriate. Preliminary valuation results are discussed internally and with third-party portfolio managers as necessary quarterly to assess consistency with market transactions and trends as applicable. Market transactions such as trades or negotiated settlements of similar positions, if any, are reviewed to validate fair value model results. However, financial instruments valued using significant unobservable inputs have very little or no observable market activity. Methods and significant inputs and assumptions used to determine fair values across portfolios are reviewed quarterly by senior financial management. Other valuation control procedures specific to particular portfolios are described further below. Fixed Maturity Securities The fair values of fixed maturity investment securities are based primarily on market prices received from independent pricing sources. Because many fixed maturity securities do not trade on a daily basis, pricing sources apply available market information through processes such as matrix pricing to calculate fair value. Such prices generally consider a variety of factors, including recent trades of the same and similar securities. In those cases, the items are classified within Level 2. For those fixed maturity investments where quotes were not available or cannot be reasonably corroborated, fair values are based on internal valuation models. Key inputs to the internal valuation models generally include maturity date, coupon and yield curves for asset-type and credit rating characteristics that closely match those characteristics of the specific investment securities being valued. Items valued using valuation models are classified according to the lowest level input or value driver that is significant to the valuation. Thus, an item may be classified in Level 3 even though there may be significant inputs that are readily observable. Longer (shorter) expected maturities or higher (lower) yields used in the valuation model will, in isolation, result in decreases (increases) in fair value. Generally, lower credit ratings or longer expected maturities will be accompanied by higher yields used to value a security. Octave performs various review and validation procedures to quoted and modeled prices for fixed maturity securities, including price variance analyses, missing and static price reviews, overall valuation analysis by portfolio managers and finance managers and reviews associated with our ongoing impairment analysis. Unusual prices identified through these procedures will be evaluated further against alternative third-party quotes (if available), internally modeled prices and/or other relevant data, and the pricing source values will be challenged as necessary. Price challenges generally result in the use of the pricing source’s quote as originally provided or as revised by the source following their internal diligence process. A price challenge may result in a determination by either the pricing source or Octave management that the pricing source cannot provide a reasonable value for a security or cannot adequately support a quote, in which case Octave would resort to using either other quotes or internal models. Results of price challenges are reviewed by portfolio managers and finance managers. Other Investments Other investments includes investments in pooled investment funds carried under the equity method valued using NAV as a practical expedient as permitted under the Fair Value Measurement Topic of the ASC. Refer to Note 6. Investments for additional information about such investments in pooled funds that are reported at fair value using NAV as a practical expedient. Derivative Instruments As of December 31, 2025, Octave has foreign currency forward contracts and holds warrants to purchase preferred stock of a development stage company. The fair value of foreign currency forwards are determined using valuation models with observable market inputs. Fair value of the warrants are determined using a standard warrant valuation model with internally developed input assumptions. Debt Both the long-term and short-term debt as of December 31, 2025 and 2024 consists of SOFR indexed borrowing under credit facilities and are classified as Level 3. Other Financial Assets Included in Other assets are loans carried at amortized cost, the fair values of which are estimated based upon internal valuation models and are classified as Level 3. Additional Fair Value Information for Financial Assets and Liabilities Accounted for at Fair Value The following tables present the changes in the Level 3 fair value category for the periods presented in 2025, 2024 and 2023. Octave classifies financial instruments in Level 3 of the fair value hierarchy when there is reliance on at least one significant unobservable input to the valuation model. In addition to these unobservable inputs, the valuation models for Level 3 financial instruments typically also rely on a number of inputs that are readily observable either directly or indirectly. Thus, the gains and losses presented below include changes in the fair value related to both observable and unobservable inputs.
Level-3 Financial Assets and Liabilities Accounted for at Fair Value |  |  |  |  |  |  |  |
Year Ended |  | December 31, 2025 |  | December 31, 2024 |  | December 31, 2023
|  | Investments |  | Derivatives |  | Total |  | Investments |  | Derivatives |  | Total |  | Investments |  | Derivatives |  | Total
Balance, beginning of period |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 13,920 |  |  | $ | 656 |  |  | $ | 14,576 |  |  | $ | 12,341 |  |  | $ | 935 |  |  | $ | 13,276 |
Total gains/(losses) realized and unrealized: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Included in earnings |  | — |  |  | — |  |  | — |  |  | 6,016 |  |  | (656) |  |  | 5,360 |  |  | — |  |  | (279) |  |  | (279) |
Included in other comprehensive income |  | — |  |  | — |  |  | — |  |  | 125 |  |  |  |  | 125 |  |  | 784 |  |  | — |  |  | 784 |
Purchases |  | — |  |  | — |  |  | — |  |  | — |  |  |  |  | — |  |  | 795 |  |  | — |  |  | 795 |
Issuances |  | — |  |  | — |  |  | — |  |  | — |  |  |  |  | — |  |  | — |  |  | — |  |  | — |
Sales |  | — |  |  | — |  |  | — |  |  | — |  |  |  |  | — |  |  | — |  |  | — |  |  | — |
Settlements |  | — |  |  | — |  |  | — |  |  | (20,061) |  |  |  |  | (20,061) |  |  | — |  |  | — |  |  | — |
Balance, end of period |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 13,920 |  |  | $ | 656 |  |  | $ | 14,576 |
The amount of total gains/(losses) included in earnings attributable to the change in unrealized gains or losses relating to assets and liabilities still held at the reporting date |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | (656) |  |  | $ | (656) |  |  | $ | — |  |  | $ | (279) |  |  | $ | (279) |
The amount of total gains/(losses) included in other comprehensive income attributable to the change in unrealized gains or losses relating to assets and liabilities still held at the reporting date |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 784 |  |  | $ | — |  |  | $ | 784 |
Invested assets are transferred into Level 3 when internal valuation models that include significant unobservable inputs are used to estimate fair value. All such securities that have internally modeled fair values have been classified as Level 3. Derivative instruments are transferred into Level 3 when the use of unobservable inputs becomes significant to the overall valuation. There were no transfers of financial instruments into or out of Level 3 in the periods disclosed. Gains and losses (realized and unrealized) relating to Level 3 assets and liabilities included in earnings for the affected periods are reported as follows:
|  | Net Investment Income |  |  |  |  |  |  |  | Net Gains (Losses) on Derivative Contracts |
Year Ended December 31, 2025 |  |  |  |  |  |  |  |  |  |  |
Total gains (losses) included in earnings for the period |  | $ | — |  |  |  |  |  |  |  |  | $ | — |  |
Changes in unrealized gains (losses) relating to financial instruments still held at the reporting date |  | — |  |  |  |  |  |  |  |  | — |  |
Year Ended December 31, 2024 |  |  |  |  |  |  |  |  |  |  |
Total gains (losses) included in earnings for the period |  | $ | 6,016 |  |  |  |  |  |  |  |  | $ | (656) |  |
Changes in unrealized gains (losses) relating to financial instruments still held at the reporting date |  | — |  |  |  |  |  |  |  |  | (656) |  |
Year Ended December 31, 2023 |  |  |  |  |  |  |  |  |  |  |
Total gains (losses) included in earnings for the period |  | $ | — |  |  |  |  |  |  |  |  | $ | (278) |  |
Changes in unrealized gains (losses) relating to financial instruments still held at the reporting date |  | — |  |  |  |  |  |  |  |  | (278) |  |

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb)(1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 3: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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