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Note 15 - Reserves for Losses and Loss Adjustment Expenses

6 Months Ended

Jun. 30, 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 six months ended June 30:

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

Provision for losses and LAE claims arising in:
Current year		491,320		1,283,212
Prior year		517,087		139,499
Total incurred		1,008,407		1,422,711
Losses and LAE payments for claims arising in:
Current year		1,038,694		232,937
Prior years		745,574		323,921
Total payments		1,784,268		556,858

Losses and LAE at June 30	$	1,716,473	$	2,069,346

For the six months ended June 30, 2021, $745,574 was paid for incurred claims and claim adjustment expenses attributable to insured events of prior years. There has been a $640,973 favorable prior year development during the six months ended June 30, 2021. Reserves remaining as of June 30, 2021 for prior years are $517,087 as a result of re-estimation of unpaid losses and loss adjustment expenses. For the six months ended June 30, 2020, $323,921 was paid for incurred claims and claim adjustment expenses attributable to insured events of prior years. There was a $138,921 unfavorable prior year development during the six months ended June 30, 2020.

Reserves remaining as of June 30, 2020 for prior years were $139,499 as a result of re-estimation of unpaid losses and loss adjustment expenses. In both periods, the 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 were $102,016 and $120,000 as of June 30, 2021 and 2020, respectively.