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Income Taxes | 12 Months Ended
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Dec. 31, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | 12. Income Taxes Global Indemnity Group, LLC is a publicly traded partnership for U.S. federal income tax purposes and meets the qualifying income exception to maintain partnership status. As a publicly traded partnership, Global Indemnity Group, LLC is generally not subject to federal income tax and most state income taxes. However, income earned by the subsidiaries of Global Indemnity Group, LLC is subject to corporate tax in the United States and certain foreign jurisdictions. As of December 31, 2022, the statutory income tax rates of the countries where the Company conducts or conducted business are 21% in the United States, 0% in Bermuda, 19% in the United Kingdom and 25% on non-trading income, 33% on capital gains and 12.5% on trading income in the Republic of Ireland. The statutory income tax rate of each country is applied against the expected annual taxable income of the Company in each country to estimate the annual income tax expense. The Company's income (loss) before income taxes is derived from its U.S. subsidiaries for the years ended December 31, 2022 and 2021. For the year ended December 31, 2020, the Company's income (loss) before income taxes from its non-U.S. subsidiaries and U.S. subsidiaries was as follows:
Year Ended December 31, 2020 (Dollars in thousands) |  | Non-U.S. Subsidiaries |  |  | U.S. Subsidiaries |  |  | Eliminations |  |  | Total |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |
Gross written premiums |  | $ | 46,654 |  |  | $ | 559,949 |  |  | $ | — |  |  | $ | 606,603 |
Net written premiums |  | $ | 46,654 |  |  | $ | 501,513 |  |  | $ | — |  |  | $ | 548,167 |
Net earned premiums |  | $ | 53,384 |  |  | $ | 514,315 |  |  | $ | — |  |  | $ | 567,699 |
Net investment income |  |  | 17,186 |  |  |  | 20,348 |  |  |  | (9,142 | ) |  |  | 28,392 |
Net realized investment losses |  |  | (3,867 | ) |  |  | (10,795 | ) |  |  | — |  |  |  | (14,662 | )
Other income |  |  | 148 |  |  |  | 1,970 |  |  |  | — |  |  |  | 2,118 |
Total revenues |  |  | 66,851 |  |  |  | 525,838 |  |  |  | (9,142 | ) |  |  | 583,547 |
Losses and Expenses: |  |  |  |  |  |  |  |  |  |  |  |
Net losses and loss adjustment expenses |  |  | 12,874 |  |  |  | 323,327 |  |  |  | — |  |  |  | 336,201 |
Acquisition costs and other underwriting expenses |  |  | 17,827 |  |  |  | 197,780 |  |  |  | — |  |  |  | 215,607 |
Corporate and other operating expenses |  |  | 23,357 |  |  |  | 18,641 |  |  |  | — |  |  |  | 41,998 |
Interest expense |  |  | 869 |  |  |  | 24,065 |  |  |  | (9,142 | ) |  |  | 15,792 |
Loss on extinguishment of debt |  |  | 3,060 |  |  |  | — |  |  |  | — |  |  |  | 3,060 |
Income (loss) before income taxes |  | $ | 8,864 |  |  | $ | (37,975 | ) |  | $ | — |  |  | $ | (29,111 | )
The following table summarizes the components of income tax expense (benefit):
|  | Years Ended December 31, |
(Dollars in thousands) |  | 2022 |  |  | 2021 |  |  | 2020 |
Current income tax expense: |  |  |  |  |  |  |  |  |
Foreign |  | $ | 4 |  |  | $ | 54 |  |  | $ | — |
U.S. Federal |  |  | 422 |  |  |  | — |  |  |  | 163 |
Total current income tax expense |  |  | 426 |  |  |  | 54 |  |  |  | 163 |
Deferred income tax expense (benefit): |  |  |  |  |  |  |  |  |
U.S. Federal |  |  | 2,395 |  |  |  | 3,395 |  |  |  | (8,268 | )
Total deferred income tax expense (benefit) |  |  | 2,395 |  |  |  | 3,395 |  |  |  | (8,268 | )
Total income tax expense (benefit) |  | $ | 2,821 |  |  | $ | 3,449 |  |  | $ | (8,105 | )
The weighted average expected tax provision has been calculated using income (loss) before income taxes in each jurisdiction multiplied by that jurisdiction’s applicable statutory tax rate. The following table summarizes the differences between the tax provision for financial statement purposes and the expected tax provision at the weighted average tax rate:
|  | Years Ended December 31, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
(Dollars in thousands) |  | Amount |  |  | % of Pre- Tax Income |  |  | Amount |  |  | % of Pre- Tax Income |  |  | Amount |  |  | % of Pre- Tax Income |
Expected tax provision at weighted average |  | $ | 414 |  |  |  | 21.0 | % |  | $ | 6,889 |  |  |  | 21.0 | % |  | $ | (7,975 | ) |  |  | 27.4 | %
Adjustments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Tax exempt interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2 | ) |  |  | — |
Dividend exclusion |  |  | (89 | ) |  |  | (4.5 | ) |  |  | (78 | ) |  |  | (0.2 | ) |  |  | (202 | ) |  |  | 0.7 |
Non-deductible interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,773 |  |  |  | (6.1 | )
Change in tax status |  |  | 700 |  |  |  | 35.5 |  |  |  | — |  |  |  | — |  |  |  | (1,704 | ) |  |  | 5.8 |
Parent income treated as partnership for tax |  |  | 2,156 |  |  |  | 109.4 |  |  |  | (4,057 | ) |  |  | (12.4 | ) |  |  | (533 | ) |  |  | 1.8 |
Other |  |  | (360 | ) |  |  | (18.3 | ) |  |  | 695 |  |  |  | 2.1 |  |  |  | 538 |  |  |  | (1.8 | )
Effective income tax expense (benefit) |  | $ | 2,821 |  |  |  | 143.1 | % |  | $ | 3,449 |  |  |  | 10.5 | % |  | $ | (8,105 | ) |  |  | 27.8 | %
The effective income tax expense rate for 2022 was 143.1%, compared with an effective income tax expense rate of 10.5% for 2021 and an effective income tax benefit rate of 27.8% for 2020. The difference between years is primarily due to a change in income or loss at the parent company which is treated as a partnership for tax. The tax effects of temporary differences that give rise to significant portions of the net deferred tax assets at December 31, 2022 and 2021 are presented below:
(Dollars in thousands) |  | 2022 |  |  | 2021 |
Deferred tax assets: |  |  |  |  |  |
Discounted unpaid losses and loss adjustment expenses |  | $ | 9,522 |  |  | $ | 8,696 |
Unearned premiums |  |  | 10,581 |  |  |  | 11,049 |
Net operating loss carryforward |  |  | 24,454 |  |  |  | 28,584 |
Partnership K1 basis differences |  |  | 1,234 |  |  |  | 795 |
Loss on derivative instruments |  |  | — |  |  |  | 1,763 |
Capital loss carryforwards |  |  | 2,338 |  |  |  | — |
Investment impairments |  |  | 124 |  |  |  | 147 |
Stock options |  |  | 1,465 |  |  |  | 2,008 |
Stat-to-GAAP reinsurance reserve |  |  | 1,668 |  |  |  | 1,517 |
Unrealized loss on securities available-for-sale |  |  | 10,568 |  |  |  | — |
Depreciation and amortization |  |  | 1,211 |  |  |  | 1,613 |
Intercompany transfers |  |  | — |  |  |  | — |
Other |  |  | 1,353 |  |  |  | 1,826 |
Total deferred tax assets |  |  | 64,518 |  |  |  | 57,998 |
Deferred tax liabilities: |  |  |  |  |  |
Intangible assets |  |  | 3,146 |  |  |  | 4,395 |
Unrealized gain on securities available-for-sale and investments in limited partnerships included in accumulated other comprehensive income |  |  | — |  |  |  | 1,601 |
Deferred acquisition costs |  |  | 13,628 |  |  |  | 12,670 |
Partnership K1 basis differences |  |  | — |  |  |  | 1,709 |
Other |  |  | 645 |  |  |  | 294 |
Total deferred tax liabilities |  |  | 17,419 |  |  |  | 20,669 |
Total net deferred tax assets |  | $ | 47,099 |  |  | $ | 37,329 |
The deferred tax assets and deferred tax liabilities listed in the table above relate to temporary differences between the Company’s accounting and tax carrying values and carryforwards for its companies in the United States. Management believes it is more likely than not that the remaining deferred tax assets will be completely utilized in future years. As a result, the Company has not recorded a valuation allowance at December 31, 2022 and 2021. The Company has a net operating loss (“NOL”) carryforward of $116.4 million as of December 31, 2022, which begins to expire in 2036 based on when the original NOL was generated. The Company’s NOL carryforward as of December 31, 2021 was $136.1 million. The Company did no t have any Section 163(j) ("163(j)") carryforward as December 31, 2022 or 2021. The 163(j) carryforward relates to the limitation on the deduction for business interest expense paid or accrued. The Company and some of its subsidiaries file income tax returns in the U.S. federal jurisdiction and various U.S. states and certain foreign jurisdictions. The Company is no longer subject to U.S. federal tax examinations by tax authorities for tax years before 2019. The Company applies a more-likely-than-not recognition threshold for all tax uncertainties whereby it only recognizes those tax benefits that have a greater than 50% likelihood of being sustained upon examination by relevant taxing authorities. All tax benefits recognized by the Company in 2022, 2021, and 2020 have a greater than 50% likelihood of being sustained upon examination by relevant taxing authorities. The Company classifies all interest and penalties related to uncertain tax positions as income tax expense. The Company did no t incur any interest and penalties related to uncertain tax positions during the years ended December 31, 2022, 2021 and 2020. As of December 31, 2022, the Company did no t record any significant liabilities for tax-related interest and penalties on its consolidated balance sheets.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI https://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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