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Note 15 - Reserves for Losses and Loss Adjustment Expenses

3 Months Ended

Mar. 31, 2021

NOTE 15. RESERVES FOR LOSSES AND LOSS ADJUSTMENT EXPENSES

The following table provides a reconciliation of the beginning and ending reserve balances for losses and loss adjustment expenses ("LAE") for the three months ended March 31:

	*2021*		*2020*
Losses and LAE at January 1	$	2,492,334	$	1,203,493

Provision for losses and LAE claims arising in:
Current year		249,778		575,685
Prior year		340,087		40,806
Total incurred		589,865		616,491
Losses and LAE payments for claims arising in:
Current year		228,305		74,192
Prior years		310,553		379,891
Total payments		538,858		454,083

Losses and LAE at March 31	$	2,543,341	$	1,365,901

For the three months ended March 31, 2021, $310,553 was paid for incurred claims and claim adjustment expenses attributable to insured events of prior years. There has been a $191,000 favorable prior year development during the three months ended March 31, 2021. Reserves remaining as of March 31, 2021 for prior years are $340,087 as a result of re-estimation of unpaid losses and loss adjustment expenses. For the three months ended March 31, 2020, $379,891 was paid for incurred claims and claim adjustment expenses attributable to insured events of prior years. There was a $157,000 favorable prior year development during the three months ended March 31, 2020.

Reserves remaining as of March 31, 2020 for prior years were $40,806 as a result of re-estimation of unpaid losses and loss adjustment expenses. In both periods, the favorable prior years' loss development was the result of a re-estimation of amounts ultimately to be paid on prior year losses and loss adjustment expense. Original estimates are increased or decreased as additional information becomes known regarding individual claims. Reinsurance recoverables of ($12,074) and $120,000 are included within Loss and Loss Adjustment Reserves as of March 31, 2021 and 2020, respectively.