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Commitments and Contingencies
9 Months Ended
Sep. 30, 2020
Commitments And Contingencies Disclosure [Abstract]  
Commitments and Contingencies

12.Commitments and Contingencies

 

Legal Proceedings

 

The Company is, from time to time, involved in various legal proceedings in the ordinary course of business.  The Company maintains insurance and reinsurance coverage for such risks in amounts that it considers adequate.  However, there can be no assurance that the insurance and reinsurance coverage that the Company maintains is sufficient or will be available in adequate amounts or at a reasonable cost.  The Company does not believe that the resolution of any currently pending legal proceedings, either individually or taken as a whole, will have a material adverse effect on its business, results of operations, cash flows, or financial condition.  

 

There is a greater potential for disputes with reinsurers who are in runoff.  Some of the Company’s reinsurers’ have operations that are in runoff, and therefore, the Company closely monitors those relationships.  The Company anticipates that, similar to the rest of the insurance and reinsurance industry, it will continue to be subject to litigation and arbitration proceedings in the ordinary course of business.

 

Commitments

 

In 2014, the Company entered into a $50 million commitment to purchase an alternative investment vehicle which is comprised of European non-performing loans.  As of September 30, 2020, the Company has funded $35.8 million of this commitment leaving $14.2 million as unfunded.

 

In 2017, the Company entered into a $50 million commitment to purchase an alternative investment vehicle comprised of stressed and distressed securities and structured products.  As of September 30, 2020, the Company has funded $33.0 million of this commitment leaving $17.0 million as unfunded. 

 

In 2019, the Company entered into a $10 million commitment to purchase an alternative investment vehicle which is comprised of mortgage loans and other real-estate related investments.  As of September 30, 2020, the Company has fully funded this commitment.  

 

Other Commitments

 

The Company is party to a Management Agreement, as amended, with Fox Paine & Company, LLC, whereby in connection with certain management services provided to it by Fox Paine & Company, LLC, the Company agreed to pay an annual

management fee to Fox Paine & Company, LLC.  See Note 11 above for additional information pertaining to this management agreement.

 

COVID-19

 

There is risk that legislation could be passed which would require the Company to cover business interruption claims regardless of terms, exclusions including the virus exclusions contained within the Company’s Commercial Specialty and Farm, Ranch & Stable policies, or other conditions included in policies that would otherwise preclude coverage.