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7. Reinsurance (Tables)
 12 Months Ended
Dec. 31, 2019
Reinsurance Disclosures [Abstract]  
Line of Business

   Treaty Year
  December 15, 2019   July 1, 2019   July 1, 2018   July 1, 2017
  to   to   to   to
Line of Business December 31, 2020   December 14, 2019   June 30, 2019   June 30, 2018
               
Personal Lines:              
Homeowners, dwelling fire and              
and canine legal liability              
 Quota share treaty:              
 Percent ceded 25%   None   10%   20%

 

     Treaty Year  
    December 15, 2019     July 1, 2019     July 1, 2018     July 1, 2017  
    to     to     to     to  
 Line of Business   June 30, 2020     December 14, 2019     June 30, 2019     June 30, 2018  
                         
Personal Lines:                        
Homeowners, dwelling fire and                        
and canine legal liability                        
 Quota share treaty:                        
 Risk retained on intial $1,000,000                        
 of losses   $ 750,000     $ 1,000,000     $ 900,000     $ 800,000  
 Losses per occurrence subject to                                
 quota share reinsurance coverage   $ 1,000,000     None     $ 1,000,000     $ 1,000,000  
 Excess of loss coverage and facultative                                
 facility coverage (1)   $ 9,000,000     $ 9,000,000     $  9,000,000     $ 9,000,000  
 

 

 

    in excess of      in excess of      in excess of     in excess of  
    $  1,000,000     $ 1,000,000     $  1,000,000     $  1,000,000  
 Total reinsurance coverage per occurrence   $  9,250,000     $ 9,000,000     $  9,100,000     $  9,200,000  
 Losses per occurrence subject to                                
 reinsurance coverage   $  10,000,000     $ 10,000,000     $  10,000,000     $  10,000,000  
 Expiration date

 

   June 30, 2020     June 30, 2020     June 30, 2019     June 30, 2018   
                                 
Catastrophe Reinsurance:                                
 Initial loss subject to personal lines                                
 quota share treaty   $  7,500,000     None     $ 5,000,000     $ 5,000,000  
 Risk retained per catastrophe                                
 occurrence (2)   $  5,625,000     $ 7,500,000     $ 4,500,000     $ 4,000,000  
 Catastrophe loss coverage in excess of                                
 quota share coverage (3)   $  602,500,000     $ 602,500,000     $ 445,000,000     $ 315,000,000  
 Reinstatement premium                                
 protection (4) (5) (6)

 

 

    Yes      Yes      Yes      Yes  

 

(1)  For personal lines, includes the addition of an automatic facultative facility allowing KICO to obtain homeowners single risk coverage up to $10,000,000 in total insured value, which covers direct losses from $3,500,000 to $10,000,000.

 

(2)  Plus losses in excess of catastrophe coverage.

 

(3)  Catastrophe coverage is limited on an annual basis to two times the per occurrence amounts. Duration of 168 consecutive hours for a catastrophe occurrence from windstorm, hail, tornado, hurricane and cyclone.

 

(4)  Effective July 1, 2017, reinstatement premium protection for $145,000,000 of catastrophe coverage in excess of $5,000,000.

 

(5)  Effective July 1, 2018, reinstatement premium protection for $210,000,000 of catastrophe coverage in excess of $5,000,000.

 

(6)  Effective July 1, 2019, reinstatement premium protection for $292,500,000 of catastrophe coverage in excess of $7,500,000.

 

     Treaty Year  
    July 1, 2019     July 1, 2018     July 1, 2017  
    to     to     to  
 Line of Business   June 30, 2020     June 30, 2019     June 30, 2018  
                   
Personal Lines:                  
 Personal Umbrella                  
 Quota share treaty:                  
 Percent ceded - first $1,000,000 of coverage     90 %     90 %     90 %
 Percent ceded - excess of $1,000,000 dollars of coverage     100 %     100 %     100 %
 Risk retained   $ 100,000     $ 100,000     $ 100,000  
 Total reinsurance coverage per occurrence   $ 4,900,000     $ 4,900,000     $ 4,900,000  
 Losses per occurrence subject to quota share reinsurance coverage   $ 5,000,000     $ 5,000,000     $ 5,000,000  
 Expiration date   June 30, 2020     June 30, 2019     June 30, 2018   
                         
Commercial Lines:                        
 General liability commercial policies                        
 Quota share treaty



  None     None      None  
 Risk retained   $ 750,000     $ 750,000     $ 750,000  
 Excess of loss coverage above risk retained   $ 3,750,000     $ 3,750,000     $ 3,750,000  
 

   

  

   

  

   

in excess of  

       in excess of         in excess of  
    $ 750,000     $ 750,000     $ 750,000  
 Total reinsurance coverage per occurrence   $ 3,750,000     $ 3,750,000     $ 3,750,000  
 Losses per occurrence subject to reinsurance coverage   $ 4,500,000     $ 4,500,000     $ 4,500,000  
                         
 Commercial Umbrella                        
 Quota share treaty:    None                  
 Percent ceded - first $1,000,000 of coverage             90 %     90 %
 Percent ceded - excess of $1,000,000 of coverage             100 %     100 %
 Risk retained           $ 100,000     $ 100,000  
 Total reinsurance coverage per occurrence           $ 4,900,000     $ 4,900,000  
 Losses per occurrence subject to quota share reinsurance coverage           $ 5,000,000     $ 5,000,000  
 Expiration date           June 30, 2019     June 30, 2018  

 
Single maximum risks under treaties per occurrence
    July 1, 2019 - December 14, 2019   December 15, 2019 - June 30, 2020
Treaty    Range of Loss    Risk Retained    Range of Loss    Risk Retained
Personal Lines (1)    Initial $1,000,000   $1,000,000    Initial $1,000,000   $750,000
     $1,000,000 - $10,000,000    None(2)    $1,000,000 - $10,000,000    None(2)
     Over $10,000,000   100%    Over $10,000,000   100%
                 
                 
                 
    July 1, 2019 - June 30, 2020        
Treaty    Range of Loss    Risk Retained        
Personal Umbrella    Initial $1,000,000   $100,000        
     $1,000,000 - $5,000,000    None        
     Over $5,000,000   100%        
                 
Commercial Lines    Initial $750,000   $750,000        
     $750,000 - $4,500,000    None(3)        
     Over $4,500,000   100%        
                 
Catastrophe (4) (5)    Initial $7,500,000   $7,500,000        
     $7,500,000 - $610,000,000    None        
     Over $610,000,000   100%        

 

(1)  Personal lines quota share treaty was eliminated effective July 1, 2019. The 2017/2019 Treaty expired on a run-off basis.

 

(2)  Covered by excess of loss treaties up to $3,500,000 and by facultative facility from $3,500,000 to $10,000,000.

 

(3)  Covered by excess of loss treaties.

 

(4)  Catastrophe coverage is limited on an annual basis to two times the per occurrence amounts.

 

 

 

The single maximum risks per occurrence to which the Company is subject under the treaties effective July 1, 2018 and 2017 are as follows:

 

    July 1, 2018 - June 30, 2019   July 1, 2017 - June 30, 2018
Treaty    Range of Loss    Risk Retained    Range of Loss    Risk Retained
Personal Lines (1)    Initial $1,000,000   $900,000    Initial $1,000,000   $800,000
     $1,000,000 - $10,000,000    None(2)    $1,000,000 - $10,000,000    None(2)
     Over $10,000,000   100%    Over $10,000,000   100%
                 
Personal Umbrella    Initial $1,000,000   $100,000    Initial $1,000,000   $100,000
     $1,000,000 - $5,000,000    None    $1,000,000 - $5,000,000    None
     Over $5,000,000   100%    Over $5,000,000   100%
                 
Commercial Lines    Initial $750,000   $750,000    Initial $750,000   $750,000
     $750,000 - $4,500,000    None(3)    $750,000 - $4,500,000    None(3)
     Over $4,500,000   100%    Over $4,500,000   100%
                 
Commercial Umbrella  Initial $1,000,000   $100,000    Initial $1,000,000   $100,000
     $1,000,000 - $5,000,000    None    $1,000,000 - $5,000,000    None
     Over $5,000,000   100%    Over $5,000,000   100%
                 
Catastrophe (4)    Initial $5,000,000   $4,500,000    Initial $5,000,000   $4,000,000
     $5,000,000 - $450,000,000    None    $5,000,000 - $320,000,000    None
     Over $450,000,000   100%    Over $320,000,000   100%

 

(1)  Treaty for July 1, 2017 – June 30, 2018 and July 1, 2018 – June 30, 2019 is a two-year treaty with expiration date of June 30, 2019.

 

(2)  Covered by excess of loss treaties up to $3,500,000 and by facultative facility from $3,500,000 to $10,000,000.

 

(3)  Covered by excess of loss treaties.

 

(4)  Catastrophe coverage is limited on an annual basis to two times the per occurrence amounts.

 
Schedule of approximate reinsurance recoverables
     Unpaid      Paid                    
 ($ in thousands)    Losses      Losses      Total      Security  
December 31, 2019                              
  Cavello Bay Reinsurance Limited (1)   $ 4,036     $ 2,427     $ 6,463     $ 5,995       (2 )
  Swiss Reinsurance America Corporation     4,418       1,336       5,754       -          
  Hanover Rueck SE     3,156       522       3,678       -          
  SCOR Reinsurance Company     394       458       852       -          
  Allied World Assurance Company     760       170       930       -          
  Others     2,964       471       3,435       -          
  Total   $ 15,728     $ 5,384     $ 21,113     $ 5,995          
                                         
December 31, 2018                                        
  Cavello Bay Reinsurance Limited (1)   $ 5,319     $ 1,277     $ 6,596     $ 7,548       (2 )
  Swiss Reinsurance America Corporation     4,499       1,251       5,750       -          
  Hanover Rueck SE     2,728       1,181       3,909       -          
  SCOR Reinsurance Company     528       89       617       -          
  Allied World Assurance Company     306       373       679       -          
  Others     2,291       282       2,573       58       (3 )
  Total   $ 15,671     $ 4,453     $ 20,125     $ 7,606          
Schedule of Ceding commissions earned
     Years ended  
    December 31,  
     2019      2018  
       
 Provisional ceding commissions earned   $ 5,446,370     $ 6,745,928  
 Contingent ceding commissions earned     (795,519 )     (1,413,298 )
    $ 4,650,851     $ 5,332,630