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Liability for Unpaid Losses and Loss Adjustment Expenses | 9 Months Ended
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Sep. 30, 2024
Insurance [Abstract] |
Liability for Unpaid Losses and Loss Adjustment Expenses | 7. Liability for Unpaid Losses and Loss Adjustment Expenses Activity in the liability for unpaid losses and loss adjustment expenses is summarized as follows:
|  | Quarters Ended September 30, |  |  | Nine Months Ended September 30, |
(Dollars in thousands) |  | 2024 |  |  | 2023 |  |  | 2024 |  |  | 2023 |
Balance at beginning of period |  | $ | 844,206 |  |  | $ | 866,951 |  |  | $ | 850,599 |  |  | $ | 832,404 |
Less: ceded reinsurance receivables |  |  | 70,392 |  |  |  | 73,933 |  |  |  | 72,829 |  |  |  | 73,021 |
Net balance at beginning of period |  |  | 773,814 |  |  |  | 793,018 |  |  |  | 777,770 |  |  |  | 759,383 |
Incurred losses and loss adjustment expenses related to: |  |  |  |  |  |  |  |  |  |  |  |
Current year |  |  | 52,434 |  |  |  | 65,167 |  |  |  | 159,561 |  |  |  | 231,199 |
Prior years |  |  | (34 | ) |  |  | (51 | ) |  |  | (115 | ) |  |  | — |
Total incurred losses and loss adjustment expenses |  |  | 52,400 |  |  |  | 65,116 |  |  |  | 159,446 |  |  |  | 231,199 |
Paid losses and loss adjustment expenses related to: |  |  |  |  |  |  |  |  |  |  |  |
Current year |  |  | 8,415 |  |  |  | 20,990 |  |  |  | 32,501 |  |  |  | 55,174 |
Prior years |  |  | 48,520 |  |  |  | 50,361 |  |  |  | 135,436 |  |  |  | 148,625 |
Total paid losses and loss adjustment expenses |  |  | 56,935 |  |  |  | 71,351 |  |  |  | 167,937 |  |  |  | 203,799 |
Net balance at end of period |  |  | 769,279 |  |  |  | 786,783 |  |  |  | 769,279 |  |  |  | 786,783 |
Plus: ceded reinsurance receivables |  |  | 70,897 |  |  |  | 75,020 |  |  |  | 70,897 |  |  |  | 75,020 |
Balance at end of period |  | $ | 840,176 |  |  | $ | 861,803 |  |  | $ | 840,176 |  |  | $ | 861,803 |
When analyzing loss reserves and prior year development, the Company considers many factors, including the frequency and severity of claims, loss trends, case reserve settlements that may have resulted in significant development, and any other additional or pertinent factors that may impact reserve estimates. During the third quarter of 2024, the Company's adjustments to prior accident year loss reserves netted to a decrease of less than $0.1 million. • Penn-America had an increase of less than $0.1 million consisting of a $3.7 million decrease for property lines offset by a $3.7 million increase for casualty lines across various accident years. • Non-Core Operations had a decrease of less than $0.1 million across various accident years. During the third quarter of 2023, the Company's adjustments to prior accident year loss reserves netted to a decrease of $0.1 million. • Penn-America had an increase of $7.8 million consisting of (i) $6.1 million increase in aggregate for casualty lines resulting from increases of $11.3 million primarily related to the 2019 through 2021 accident years partially offset by favorable development of $5.2 million across various accident years, and (ii) a $1.7 million net increase on its property lines resulting from adverse development primarily related to the 2019 to 2021 accident years. • Non-Core Operations had a decrease of $7.8 million primarily consisting of (i) a $12.7 million net decrease related to reinsurance across multiple accident years, (ii) a $4.5 million increase in aggregate for casualty lines related to $7.1 million of adverse development primarily in the 2020 through 2022 accident years partially offset by $2.6 million of favorable development primarily in the 2016 through 2019 accident years, and (iii) a $0.5 million increase in aggregate related to property due to $1.4 million of adverse development primarily in the 2022 accident year partially offset by $0.9 million of favorable development mainly in the 2016 and 2018 through 2020 accident years. During the first nine months of 2024, the Company's adjustments to prior accident year loss reserves netted to a decrease of $0.1 million. • Penn-America had a decrease of $0.4 million consisting of $4.0 million decrease for property lines offset by a $3.6 million increase for casualty lines across various accident years. • Non-Core Operations had an increase of $0.3 million across various accident years. During the first nine months of 2023, the Company's adjustments to prior accident year loss reserves netted to zero. • Penn-America had an increase of $10.9 million consisting of (i) $10.1 million increase in aggregate for casualty lines resulting from increases of $16.9 million primarily related to the 2018 through 2021 accident years partially offset by favorable development of $6.8 million across various accident years, and (ii) a $0.8 million net increase in property lines primarily related to the 2015 and 2018 through 2022 accident years. • Non-Core Operations had a decrease of $10.9 million primarily consisting of (i) a $19.0 million net decrease related to reinsurance across multiple accident years, (ii) a $6.4 million increase in aggregate for casualty lines related to $11.2 million of adverse development mainly in the 2020 through 2022 accident years partially offset by $4.8 million of favorable development primarily in the 2014 and 2016 through 2018 accident years, and (iii) a $1.8 million increase in aggregate for property lines resulting from $3.4 million of adverse development mainly in the 2021 and 2022 accident years partially offset by $1.6 million of favorable development primarily in the 2016, 2018, and 2020 accident years.

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- Definition The entire disclosure for liabilities related to future policy benefits and unpaid claims and claim adjustments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 944 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480081/944-40-50-3 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 944 -SubTopic 40 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/944-40/tableOfContent + Details
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