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Segment Information
 9 Months Ended
Sep. 30, 2023
Segment Reporting [Abstract]  
Segment Information
15.
Segment Information

 

During the fourth quarter of 2022, the Company restructured its insurance operations to strengthen its market presence and enhance its focus on GBLI’s core Package Specialty and Targeted Specialty products. As a result, the Company exited four brokerage divisions: Professional Liability, Excess Casualty, Environmental, and Middle Market Property. The Company ceased writing new business and existing renewals were placed in run-off for these four divisions. Based on the decisions to exit these lines of business, the Company changed the way it manages and analyzes its operating results. The chief operating decision makers decided they will be reviewing the specific results of these exited lines within the Company's Exited Lines segment. In addition, a decision was made in the fourth quarter of 2022 to reclassify several smaller reinsurance treaties from Reinsurance Operations to Commercial Specialty. Management believes these segment changes allow users of the Company’s financial statements to better understand the Company's performance, better assess prospects for future net cash flows, and make more informed judgments about the Company as a whole. Accordingly, the segment results for the quarter and nine months ended September 30, 2022 have been revised to reflect these changes.

 

The Company manages its business through two ongoing business segments. Commercial Specialty offers specialty property and casualty products designed for GBLI's Package Specialty and Targeted Specialty product offerings. These product lines are offered primarily in the excess and surplus lines marketplace. Reinsurance Operations provides reinsurance and insurance solutions through brokers and primary writers including insurance and reinsurance companies. The Company also has an Exited Lines segment that contains lines of business that are no longer being written or are in runoff.

The following are tabulations of business segment information for the quarters and nine months ended September 30, 2023 and 2022. Corporate information is included to reconcile segment data to the consolidated financial statements.

 

Quarter Ended September 30, 2023
(Dollars in thousands)

 

Commercial
Specialty

 

 

Reinsurance
Operations

 

(1)

Exited Lines

 

 

Total

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Gross written premiums

 

$

87,029

 

 

$

11,864

 

 

$

33

 

 

$

98,926

 

Net written premiums

 

$

84,103

 

 

$

11,864

 

 

$

(344

)

 

$

95,623

 

Net earned premiums

 

$

83,679

 

 

$

26,671

 

 

$

1,345

 

 

$

111,695

 

Other income

 

 

275

 

 

 

—

 

 

 

24

 

 

 

299

 

Total revenues

 

 

83,954

 

 

 

26,671

 

 

 

1,369

 

 

 

111,994

 

Losses and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Net losses and loss adjustment expenses

 

 

63,624

 

 

 

13,673

 

 

 

(12,181

)

 

 

65,116

 

Acquisition costs and other underwriting expenses

 

 

32,671

 

 

 

10,553

 

 

 

2,978

 

 

 

46,202

 

Income (loss) from segments

 

$

(12,341

)

 

$

2,445

 

 

$

10,572

 

 

$

676

 

Unallocated Items:

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

 

 

 

 

 

 

 

 

 

14,200

 

Net realized investment losses

 

 

 

 

 

 

 

 

 

 

 

(133

)

Corporate and other operating expenses

 

 

 

 

 

 

 

 

 

 

 

(5,280

)

Income before income taxes

 

 

 

 

 

 

 

 

 

 

 

9,463

 

Income tax expense

 

 

 

 

 

 

 

 

 

 

 

(1,763

)

Net income

 

 

 

 

 

 

 

 

 

 

$

7,700

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment assets

 

$

1,020,613

 

 

$

386,026

 

 

$

186,614

 

 

$

1,593,253

 

Corporate assets

 

 

 

 

 

 

 

 

 

 

 

174,593

 

Total assets

 

 

 

 

 

 

 

 

 

 

$

1,767,846

 

 

(1)
External business only, excluding business assumed from affiliates.

 

Quarter Ended September 30, 2022
(Dollars in thousands)

 

Commercial
Specialty

 

 

Reinsurance
Operations

 

(1)

Exited Lines

 

 

Total

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Gross written premiums

 

$

96,056

 

 

$

43,055

 

 

$

36,716

 

 

$

175,827

 

Net written premiums

 

$

93,172

 

 

$

43,055

 

 

$

6,608

 

 

$

142,835

 

Net earned premiums

 

$

98,597

 

 

$

35,046

 

 

$

20,001

 

 

$

153,644

 

Other income

 

 

272

 

 

 

—

 

 

 

44

 

 

 

316

 

Total revenues

 

 

98,869

 

 

 

35,046

 

 

 

20,045

 

 

 

153,960

 

Losses and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Net losses and loss adjustment expenses

 

 

56,833

 

 

 

20,316

 

 

 

11,310

 

 

 

88,459

 

Acquisition costs and other underwriting expenses

 

 

37,817

 

 

 

13,013

 

 

 

10,046

 

 

 

60,876

 

Income (loss) from segments

 

$

4,219

 

 

$

1,717

 

 

$

(1,311

)

 

$

4,625

 

Unallocated Items:

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

 

 

 

 

 

 

 

 

 

8,389

 

Net realized investment gains

 

 

 

 

 

 

 

 

 

 

 

2,234

 

Other income

 

 

 

 

 

 

 

 

 

 

 

30,000

 

Corporate and other operating expenses

 

 

 

 

 

 

 

 

 

 

 

(14,064

)

Income before income taxes

 

 

 

 

 

 

 

 

 

 

 

31,184

 

Income tax expense

 

 

 

 

 

 

 

 

 

 

 

(7,438

)

Net income

 

 

 

 

 

 

 

 

 

 

 

23,746

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment assets

 

$

996,336

 

 

$

372,036

 

 

$

336,668

 

 

$

1,705,040

 

Corporate assets

 

 

 

 

 

 

 

 

 

 

 

174,097

 

Total assets

 

 

 

 

 

 

 

 

 

 

$

1,879,137

 

 

(1)
External business only, excluding business assumed from affiliates.

 

Nine Months Ended September 30, 2023
(Dollars in thousands)

 

Commercial
Specialty

 

 

Reinsurance
Operations

 

(1)

Exited Lines

 

 

Total

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Gross written premiums

 

$

277,884

 

 

$

50,124

 

 

$

4,003

 

 

$

332,011

 

Net written premiums

 

$

267,233

 

 

$

50,124

 

 

$

123

 

 

$

317,480

 

Net earned premiums

 

$

270,269

 

 

$

91,103

 

 

$

19,551

 

 

$

380,923

 

Other income

 

 

808

 

 

 

—

 

 

 

127

 

 

 

935

 

Total revenues

 

 

271,077

 

 

 

91,103

 

 

 

19,678

 

 

 

381,858

 

Losses and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Net losses and loss adjustment expenses

 

 

182,405

 

 

 

54,448

 

 

 

(5,654

)

 

 

231,199

 

Acquisition costs and other underwriting expenses

 

 

102,169

 

 

 

34,106

 

 

 

10,506

 

 

 

146,781

 

Income (loss) from segments

 

$

(13,497

)

 

$

2,549

 

 

$

14,826

 

 

$

3,878

 

Unallocated Items:

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

 

 

 

 

 

 

 

 

 

39,424

 

Net realized investment losses

 

 

 

 

 

 

 

 

 

 

 

(2,414

)

Corporate and other operating expenses

 

 

 

 

 

 

 

 

 

 

 

(16,638

)

Interest expense

 

 

 

 

 

 

 

 

 

 

 

(12

)

Income before income taxes

 

 

 

 

 

 

 

 

 

 

 

24,238

 

Income tax expense

 

 

 

 

 

 

 

 

 

 

 

(4,707

)

Net income

 

 

 

 

 

 

 

 

 

 

$

19,531

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment assets

 

$

1,020,613

 

 

$

386,026

 

 

$

186,614

 

 

$

1,593,253

 

Corporate assets

 

 

 

 

 

 

 

 

 

 

 

174,593

 

Total assets

 

 

 

 

 

 

 

 

 

 

$

1,767,846

 

 

(1)
External business only, excluding business assumed from affiliates.

 

Nine Months Ended September 30, 2022
(Dollars in thousands)

 

Commercial
Specialty

 

 

Reinsurance
Operations

 

(1)

Exited Lines

 

 

Total

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Gross written premiums

 

$

303,914

 

 

$

130,575

 

 

$

129,144

 

 

$

563,633

 

Net written premiums

 

$

291,002

 

 

$

130,575

 

 

$

47,898

 

 

$

469,475

 

Net earned premiums

 

$

283,791

 

 

$

108,506

 

 

$

65,919

 

 

$

458,216

 

Other income

 

 

791

 

 

 

—

 

 

 

48

 

 

 

839

 

Total revenues

 

 

284,582

 

 

 

108,506

 

 

 

65,967

 

 

 

459,055

 

Losses and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Net losses and loss adjustment expenses

 

 

163,296

 

 

 

64,168

 

 

 

38,308

 

 

 

265,772

 

Acquisition costs and other underwriting expenses

 

 

106,886

 

 

 

39,527

 

 

 

32,253

 

 

 

178,666

 

Income (loss) from segments

 

$

14,400

 

 

$

4,811

 

 

$

(4,594

)

 

$

14,617

 

Unallocated Items:

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

 

 

 

 

 

 

 

 

 

16,911

 

Net realized investment losses

 

 

 

 

 

 

 

 

 

 

 

(33,067

)

Other income

 

 

 

 

 

 

 

 

 

 

 

30,000

 

Corporate and other operating expenses

 

 

 

 

 

 

 

 

 

 

 

(21,718

)

Interest expense

 

 

 

 

 

 

 

 

 

 

 

(3,004

)

Loss on extinguishment of debt

 

 

 

 

 

 

 

 

 

 

 

(3,529

)

Income before income taxes

 

 

 

 

 

 

 

 

 

 

 

210

 

Income tax expense

 

 

 

 

 

 

 

 

 

 

 

(3,399

)

Net loss

 

 

 

 

 

 

 

 

 

 

$

(3,189

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment assets

 

$

996,336

 

 

$

372,036

 

 

$

336,668

 

 

$

1,705,040

 

Corporate assets

 

 

 

 

 

 

 

 

 

 

 

174,097

 

Total assets

 

 

 

 

 

 

 

 

 

 

$

1,879,137

 

 

(1)
External business only, excluding business assumed from affiliates.