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Note 15 - Reserves for Losses and Loss Adjustment Expenses
 6 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Insurance Disclosure [Text Block]

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, 2023 and 2022:  

 

  

2023

  

2022

 

Losses and LAE at January 1

 $1,690,579  $1,381,526 
         

Provision for losses and LAE claims arising in:

        

Current year

  855,973   598,182 

Prior year

  952,204   485,001 

Total incurred

  1,808,177   1,083,183 

Losses and LAE payments for claims arising in:

        

Current year

  316,268   120,993 

Prior years

  351,709   814,549 

Total payments

  667,977   935,542 
         

Less reinsurance recoverable

  712,035   315,000 
         

Losses and LAE at June 30,

 $2,118,744  $1,214,167 

 

For the six months ended June 30, 2023, $351,709 was paid for incurred claims and claim adjustment expenses attributable to insured events of prior years. There has been a $709 unfavorable prior year development during the six months ended  June 30, 2023. Reserves remaining as of  June 30, 2023 for prior years are $952,204 as a result of re-estimation of unpaid losses and loss adjustment expenses.

 

For the six months ended June 30, 2022, $814,549 was paid for incurred claims and claim adjustment expenses attributable to insured events of prior years. There was a $24,549 unfavorable prior year development during the six months ended June 30, 2022. Reserves remaining as of June 30, 2022 for prior years were $485,001 as a result of re-estimation of unpaid losses and loss adjustment expenses.

 

In both periods, unfavorable prior year 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 $712,035 and $315,000 at  June 30, 2023 and June 30, 2022, respectively, and are included within Loss and Loss Adjustment Reserves.