☑
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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Delaware
(State or other jurisdiction of incorporation or
organization)
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36-2476480
(I.R.S. EmployerIdentification Number)
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Large accelerated filer
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☐
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Accelerated filer
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☑
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Non-accelerated filer
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☐ (Do
not check if a smaller reporting company)
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Smaller reporting company
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☐
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Emerging growth company
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☐
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PAGE
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PART I — FINANCIAL INFORMATION
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2
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Item 1
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2
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2
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3
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4
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5
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6
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Item 2
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36
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Item 3
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62
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Item 4
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65
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PART II — OTHER INFORMATION
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66
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Item 1
—
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66
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Item 1A
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66
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Item 2
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66
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Item 3
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66
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Item 4
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66
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Item 5
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67
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Item 6
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67
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Signatures
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EXHIBIT
3(a)
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EXHIBIT
3(b)
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EXHIBIT
31(a)
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EXHIBIT
31(b)
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EXHIBIT
32
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EXHIBIT
101.INS XBRL Instance Document
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||||||||
EXHIBIT
101.SCH XBRL Taxonomy Extension Schema
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||||||||
EXHIBIT 101.CAL
XBRL Taxonomy Extension Calculation Linkbase
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||||||||
EXHIBIT 101.DEF
XBRL Taxonomy Extension Definition Linkbase
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||||||||
EXHIBIT
101.LAB XBRL Taxonomy Extension Label Linkbase
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||||||||
EXHIBIT 101.PRE
XBRL Taxonomy Extension Presentation Linkbase
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KINGSTONE COMPANIES, INC. AND SUBSIDIARIES
|
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Condensed Consolidated Balance
Sheets
|
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March
31,
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December
31,
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2018
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2017
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(unaudited)
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Assets
|
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Fixed-maturity
securities, held-to-maturity, at amortized cost (fair value
of
|
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$5,062,065
at March 31, 2018 and $5,150,076 at December 31, 2017)
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$4,870,271
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$4,869,808
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Fixed-maturity
securities, available-for-sale, at fair value (amortized cost
of
|
|
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$130,912,757
at March 31, 2018 and $119,122,106 at December 31,
2017)
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129,149,201
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119,988,256
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Equity
securities, at fair value (cost of $16,383,342 at March 31, 2018
and
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$13,761,841
at December 31, 2017)
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16,600,485
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14,286,198
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Other
investments
|
2,027,860
|
-
|
Total
investments
|
152,647,817
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139,144,262
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Cash
and cash equivalents
|
31,594,167
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48,381,633
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Investment
subscription receivable
|
-
|
2,000,000
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Premiums
receivable, net
|
13,065,874
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13,217,698
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Reinsurance
receivables, net
|
31,895,480
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28,519,130
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Deferred
policy acquisition costs
|
15,130,213
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14,847,236
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Intangible
assets, net
|
925,000
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1,010,000
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Property
and equipment, net
|
5,132,755
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4,772,577
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Other
assets
|
4,020,364
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2,655,527
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Total assets
|
$254,411,670
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$254,548,063
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Liabilities
|
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Loss
and loss adjustment expense reserves
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$56,272,113
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$48,799,622
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Unearned
premiums
|
66,654,632
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65,647,663
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Advance
premiums
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2,216,603
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1,477,693
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Reinsurance
balances payable
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3,017,734
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2,563,966
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Deferred
ceding commission revenue
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4,347,812
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4,266,412
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Accounts
payable, accrued expenses and other liabilities
|
4,501,593
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7,487,654
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Deferred
income taxes
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77,031
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600,342
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Long-term
debt, net
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29,163,116
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29,126,965
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Total
liabilities
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166,250,634
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159,970,317
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Commitments and Contingencies
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Stockholders' Equity
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Preferred
stock, $.01 par value; authorized 2,500,000 shares
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-
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-
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Common
stock, $.01 par value; authorized 20,000,000 shares; issued
11,679,334 shares
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at
March 31, 2018 and 11,618,646 at December 31, 2017;
outstanding
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10,666,665
shares at March 31, 2018 and 10,631,837 shares at December 31,
2017
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116,793
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116,186
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Capital
in excess of par
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68,163,744
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68,380,390
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Accumulated
other comprehensive (loss) income
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(1,391,063)
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1,100,647
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Retained
earnings
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23,780,755
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27,152,822
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90,670,229
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96,750,045
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Treasury
stock, at cost, 1,012,669 shares at March 31, 2018
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and
986,809 shares at December 31, 2017
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(2,509,193)
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(2,172,299)
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Total stockholders' equity
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88,161,036
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94,577,746
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Total liabilities and stockholders' equity
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$254,411,670
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$254,548,063
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KINGSTONE COMPANIES, INC. AND SUBSIDIARIES
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Condensed Consolidated Statements of Operations and Comprehensive
Income (Loss) (Unaudited)
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Three months ended March 31,
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2018
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2017
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Revenues
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Net
premiums earned
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$22,837,617
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$16,369,748
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Ceding
commission revenue
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1,695,158
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3,184,452
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Net
investment income
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1,383,989
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857,800
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Net
losses on investments
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(523,127)
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(54,506)
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Other
income
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308,233
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289,700
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Total
revenues
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25,701,870
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20,647,194
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Expenses
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Loss
and loss adjustment expenses
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17,266,330
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8,292,996
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Commission
expense
|
5,799,948
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4,888,978
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Other
underwriting expenses
|
5,031,503
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4,212,417
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Other
operating expenses
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246,858
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755,804
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Depreciation
and amortization
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409,431
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318,698
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Interest
expense
|
456,545
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-
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Total
expenses
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29,210,615
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18,468,893
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(Loss)
income from operations before income taxes
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(3,508,745)
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2,178,301
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Income
tax (benefit) expense
|
(790,811)
|
707,721
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Net (loss) income
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(2,717,934)
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1,470,580
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Other comprehensive (loss) income, net of tax
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Gross
change in unrealized (losses) gains
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on
available-for-sale-securities
|
(2,873,479)
|
524,822
|
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Reclassification
adjustment for losses
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included
in net income
|
243,773
|
54,506
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Net
change in unrealized (losses) gains
|
(2,629,706)
|
579,328
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Income
tax benefit (expense) related to items
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of
other comprehensive (loss) income
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552,238
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(196,972)
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Other comprehensive (loss) income, net of tax
|
(2,077,468)
|
382,356
|
|
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Comprehensive (loss) income
|
$(4,795,402)
|
$1,852,936
|
|
|
|
(Loss) earnings per common share:
|
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Basic
|
$(0.25)
|
$0.15
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Diluted
|
$(0.25)
|
$0.15
|
|
|
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Weighted average common shares outstanding
|
|
|
Basic
|
10,669,992
|
9,663,751
|
Diluted
|
10,669,992
|
9,848,494
|
|
|
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Dividends declared and paid per common share
|
$0.1000
|
$0.0625
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KINGSTONE COMPANIES, INC. AND SUBSIDIARIES
|
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Condensed Consolidated Statement of Stockholders' Equity
(Unaudited)
|
||||||||||
Three months ended March 31, 2018
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
Capital
|
Other
|
|
|
|
|
|
Preferred Stock
|
Common Stock
|
in Excess
|
Comprehensive
|
Retained
|
Treasury Stock
|
|
|||
|
Shares
|
Amount
|
Shares
|
Amount
|
of Par
|
Income (Loss)
|
Earnings
|
Shares
|
Amount
|
Total
|
Balance,
January 1, 2018, as reported
|
-
|
$-
|
11,618,646
|
$116,186
|
$68,380,390
|
$1,100,647
|
$27,152,822
|
986,809
|
$(2,172,299)
|
$94,577,746
|
Cumulative
effect of adoption of updated
|
|
|
|
|
|
|
|
|
|
|
accounting
guidance for equity
|
|
|
|
|
|
|
|
|
|
|
financial
instruments at January 1, 2018
|
-
|
-
|
-
|
-
|
-
|
(414,242)
|
414,242
|
-
|
-
|
-
|
Balance,
January 1, 2018, as adjusted
|
-
|
-
|
11,618,646
|
116,186
|
68,380,390
|
686,405
|
27,567,064
|
986,809
|
(2,172,299)
|
94,577,746
|
Stock-based
compensation
|
-
|
-
|
-
|
-
|
108,368
|
-
|
-
|
-
|
-
|
108,368
|
Shares
deducted from exercise of stock
|
|
|
|
|
|
|
|
|
|
|
options for
payment of withholding taxes
|
-
|
-
|
(15,750)
|
(158)
|
(341,612)
|
-
|
-
|
-
|
-
|
(341,770)
|
Vesting of
restricted stock awards
|
-
|
-
|
7,180
|
72
|
(72)
|
-
|
-
|
-
|
-
|
-
|
Shares
deducted from restricted stock
|
|
|
|
|
|
|
|
|
|
|
awards for
payment of withholding taxes
|
-
|
-
|
(618)
|
(9)
|
(12,205)
|
-
|
-
|
-
|
-
|
(12,214)
|
Exercise of
stock options
|
-
|
-
|
69,876
|
702
|
28,875
|
-
|
-
|
-
|
-
|
29,577
|
Acquisition
of treasury stock
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
25,860
|
(336,894)
|
(336,894)
|
Dividends
|
-
|
-
|
-
|
-
|
-
|
-
|
(1,068,375)
|
-
|
-
|
(1,068,375)
|
Net
loss
|
-
|
-
|
-
|
-
|
-
|
-
|
(2,717,934)
|
-
|
-
|
(2,717,934)
|
Change in
unrealized losses on available-
|
|
|
|
|
|
|
|
|
|
|
for-sale
securities, net of tax
|
-
|
-
|
-
|
-
|
-
|
(2,077,468)
|
-
|
-
|
-
|
(2,077,468)
|
Balance,
March 31, 2018
|
-
|
$-
|
11,679,334
|
$116,793
|
$68,163,744
|
$(1,391,063)
|
$23,780,755
|
1,012,669
|
$(2,509,193)
|
$88,161,036
|
KINGSTONE COMPANIES, INC. AND SUBSIDIARIES
|
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|
|
|
Condensed Consolidated Statements of Cash Flows (Unaudited)
|
|
|
Three months ended March 31,
|
2018
|
2017
|
|
|
|
Cash flows from operating
activities:
|
|
|
Net
(loss) income
|
$(2,717,934)
|
$1,470,580
|
Adjustments to reconcile net (loss) income to net cash flows
provided by operating activities:
|
|
|
Net
losses on investments
|
523,127
|
54,506
|
Depreciation
and amortization
|
409,431
|
318,698
|
Amortization
of bond premium, net
|
118,841
|
124,054
|
Amortization
of discount on issuance costs on long-term debt
|
36,151
|
-
|
Stock-based
compensation
|
108,368
|
59,055
|
Deferred
income tax benefit
|
28,927
|
32,504
|
(Increase)
decrease in operating assets:
|
|
|
Premiums
receivable, net
|
151,824
|
(79,045)
|
Reinsurance
receivables, net
|
(3,376,350)
|
(1,304,877)
|
Deferred
policy acquisition costs
|
(282,977)
|
(228,195)
|
Other
assets
|
(1,386,512)
|
11,563
|
Increase
(decrease) in operating liabilities:
|
|
|
Loss
and loss adjustment expense reserves
|
7,472,491
|
2,874,867
|
Unearned
premiums
|
1,006,969
|
327,923
|
Advance
premiums
|
738,910
|
543,896
|
Reinsurance
balances payable
|
453,768
|
(37,570)
|
Deferred
ceding commission revenue
|
81,400
|
(78,984)
|
Accounts
payable, accrued expenses and other liabilities
|
(2,986,061)
|
(2,032,832)
|
Net cash flows provided by operating activities
|
380,373
|
2,056,143
|
|
|
|
Cash flows from investing
activities:
|
|
|
Purchase
- fixed-maturity securities available-for-sale
|
(20,018,600)
|
(22,811,402)
|
Purchase
- equity securities
|
(6,004,614)
|
-
|
Sale
and redemption - fixed-maturity securities
held-to-maturity
|
-
|
200,000
|
Sale
or maturity - fixed-maturity securities
available-for-sale
|
7,891,145
|
2,706,202
|
Sale
- equity securities available-for-sale
|
3,378,515
|
132,091
|
Acquisition
of fixed assets
|
(684,609)
|
(597,761)
|
Net cash flows used in
investing activities
|
(15,438,163)
|
(20,370,870)
|
|
|
|
Cash flows from financing
activities:
|
|
|
Net
proceeds from issuance of common stock
|
-
|
30,136,699
|
Proceeds
from exercise of stock options
|
29,577
|
33,000
|
Withholding
taxes paid on net exercise of stock options
|
(341,770)
|
-
|
Withholding
taxes paid on vested retricted stock awards
|
(12,214)
|
-
|
Purchase
of treasury stock
|
(336,894)
|
-
|
Dividends
paid
|
(1,068,375)
|
(663,837)
|
Net cash flows (used in)
provided by financing activities
|
(1,729,676)
|
29,505,862
|
|
|
|
(Decrease)
increase in cash and cash equivalents
|
$(16,787,466)
|
$11,191,135
|
Cash
and cash equivalents, beginning of period
|
48,381,633
|
12,044,520
|
Cash and cash equivalents, end of period
|
$31,594,167
|
$23,235,655
|
|
|
|
Supplemental disclosures of cash flow
information:
|
|
|
Cash
paid for income taxes
|
$-
|
$-
|
|
March 31, 2018
|
|||||
|
|
|
|
|
|
Net
|
|
Cost or
|
Gross
|
Gross Unrealized Losses
|
|
Unrealized
|
|
|
Amortized
|
Unrealized
|
Less than 12
|
More than 12
|
Fair
|
Gains/
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
(Losses)
|
|
|
|
|
|
|
|
Fixed-Maturity
Securities |
|
|
|
|
|
|
U.S.
Treasury securities and
|
|
|
|
|
|
|
obligations
of U.S. government
|
|
|
|
|
|
|
corporations
and agencies
|
$4,964,012
|
$-
|
$(20,282)
|
$-
|
$4,943,730
|
$(20,282)
|
|
|
|
|
|
|
|
Political subdivisions of States,
|
|
|
|
|
|
|
Territories
and Possessions
|
6,591,252
|
48,955
|
(84,282)
|
-
|
6,555,925
|
(35,327)
|
|
|
|
|
|
|
|
Corporate and other bonds
|
|
|
|
|
|
|
Industrial
and miscellaneous
|
96,910,715
|
189,515
|
(1,436,598)
|
(369,216)
|
95,294,416
|
(1,616,299)
|
|
|
|
|
|
|
|
Residential mortgage and other
|
|
|
|
|
|
|
asset
backed securities (1)
|
22,446,778
|
325,807
|
(104,872)
|
(312,583)
|
22,355,130
|
(91,648)
|
Total
|
$130,912,757
|
$564,277
|
$(1,646,034)
|
$(681,799)
|
$129,149,201
|
$(1,763,556)
|
|
December 31, 2017
|
|||||
|
|
|
|
|
|
Net
|
|
Cost or
|
Gross
|
Gross Unrealized Losses
|
|
Unrealized
|
|
|
Amortized
|
Unrealized
|
Less than 12
|
More than 12
|
Fair
|
Gains/
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
(Losses)
|
Fixed-Maturity Securities:
|
|
|
|
|
|
|
U.S.
Treasury securities and
|
|
|
|
|
|
|
obligations
of U.S. government
|
|
|
|
|
|
|
corporations
and agencies
|
$-
|
$-
|
$-
|
$-
|
$-
|
$-
|
|
|
|
|
|
|
|
Political subdivisions of States,
|
|
|
|
|
|
|
Territories
and Possessions
|
11,096,122
|
250,135
|
(30,814)
|
-
|
11,315,443
|
219,321
|
|
|
|
|
|
|
|
Corporate and other bonds
|
|
|
|
|
|
|
Industrial
and miscellaneous
|
87,562,631
|
1,189,207
|
(269,857)
|
(340,516)
|
88,141,465
|
578,834
|
|
|
|
|
|
|
|
Residential mortgage and other
|
|
|
|
|
|
|
asset
backed securities (1)
|
20,463,353
|
305,499
|
(48,482)
|
(189,022)
|
20,531,348
|
67,995
|
Total
|
$119,122,106
|
$1,744,841
|
$(349,153)
|
$(529,538)
|
$119,988,256
|
$866,150
|
|
March 31, 2018
|
December 31, 2017
|
||
|
Amortized
|
|
Amortized
|
|
Remaining Time to
Maturity
|
Cost
|
Fair Value
|
Cost
|
Fair Value
|
|
|
|
|
|
Less
than one year
|
$2,409,941
|
$2,412,121
|
$2,585,479
|
$2,595,938
|
One
to five years
|
37,226,594
|
37,045,335
|
31,716,345
|
32,065,197
|
Five
to ten years
|
66,817,711
|
65,430,615
|
62,702,945
|
63,129,543
|
More
than 10 years
|
2,011,733
|
1,906,000
|
1,653,984
|
1,666,230
|
Residential
mortgage and other asset backed securities
|
22,446,778
|
22,355,130
|
20,463,353
|
20,531,348
|
Total
|
$130,912,757
|
$129,149,201
|
$119,122,106
|
$119,988,256
|
|
March 31, 2018
|
|||||
|
|
|
|
|
|
Net
|
|
Cost or
|
Gross
|
Gross Unrealized Losses
|
|
Unrealized
|
|
|
Amortized
|
Unrealized
|
Less than 12
|
More than 12
|
Fair
|
Gains/
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
(Losses)
|
Equity Securities:
|
|
|
|
|
|
|
Preferred
stocks
|
$7,301,491
|
$25,807
|
$(97,834)
|
$(116,287)
|
$7,113,177
|
$(188,314)
|
Common
stocks and exchange
|
|
|
|
|
|
|
traded
mutual funds
|
9,081,851
|
683,494
|
(278,037)
|
-
|
9,487,308
|
405,457
|
Total
|
$16,383,342
|
$709,301
|
$(375,871)
|
$(116,287)
|
$16,600,485
|
$217,143
|
|
December 31, 2017
|
|||||
|
|
|
|
|
|
Net
|
|
|
Gross
|
Gross Unrealized Losses
|
|
Unrealized
|
|
|
|
Unrealized
|
Less than 12
|
More than 12
|
Fair
|
Gains/
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
(Losses)
|
|
|
|
|
|
|
|
Equity Securities:
|
|
|
|
|
|
|
Preferred
stocks
|
$7,081,099
|
$60,867
|
$(20,313)
|
$(120,712)
|
$7,000,941
|
$(80,158)
|
Common stocks and exchange
|
|
|
|
|
|
|
traded
mutual funds
|
6,680,742
|
841,250
|
(222,205)
|
(14,530)
|
7,285,257
|
604,515
|
Total
|
$13,761,841
|
$902,117
|
$(242,518)
|
$(135,242)
|
$14,286,198
|
$524,357
|
|
March 31, 2018
|
December 31, 2017
|
||||
|
|
Fair
|
Unrealized
|
|
Fair
|
Unrealized
|
Category
|
Cost
|
Value
|
Gain
|
Cost
|
Value
|
Gain
|
|
|
|
|
|
||
Other Investments:
|
|
|
|
|
|
|
Hedge
fund
|
$2,000,000
|
$2,027,860
|
$27,860
|
$-
|
$-
|
$-
|
Total
|
$2,000,000
|
$2,027,860
|
$27,860
|
$-
|
$-
|
$-
|
|
March 31, 2018
|
|||||
|
|
|
|
|
|
|
|
Cost or
|
Gross
|
Gross
Unrealized Losses
|
|
Net
|
|
|
Amortized
|
Unrealized
|
Less
than 12
|
More
than 12
|
Fair
|
Unrealized
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
Gains
|
|
|
|
|
|
|
|
U.S.
Treasury securities
|
$729,476
|
$147,563
|
$(5,064)
|
$-
|
$871,975
|
$142,499
|
|
|
|
|
|
|
|
Political
subdivisions of States,
|
|
|
|
|
|
|
Territories
and Possessions
|
998,941
|
32,014
|
-
|
-
|
1,030,955
|
32,014
|
|
|
|
|
|
|
|
Corporate
and other bonds
|
|
|
|
|
|
|
Industrial
and miscellaneous
|
3,141,854
|
43,177
|
(15,741)
|
(10,155)
|
3,159,135
|
17,281
|
|
|
|
|
|
|
|
Total
|
$4,870,271
|
$222,754
|
$(20,805)
|
$(10,155)
|
$5,062,065
|
$191,794
|
|
December 31, 2017
|
|||||
|
|
|
|
|
|
|
|
Cost or
|
Gross
|
Gross
Unrealized Losses
|
|
Net
|
|
|
Amortized
|
Unrealized
|
Less
than 12
|
More
than 12
|
Fair
|
Unrealized
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
Gains
|
|
|
|
|
|
|
|
U.S.
Treasury securities
|
$729,466
|
$147,573
|
$(1,729)
|
$-
|
$875,310
|
$145,844
|
|
|
|
|
|
|
|
Political
subdivisions of States,
|
|
|
|
|
|
|
Territories
and Possessions
|
998,984
|
50,366
|
-
|
-
|
1,049,350
|
50,366
|
|
|
|
|
|
|
|
Corporate
and other bonds
|
|
|
|
|
|
|
Industrial
and miscellaneous
|
3,141,358
|
90,358
|
-
|
(6,300)
|
3,225,416
|
84,058
|
|
|
|
|
|
|
|
Total
|
$4,869,808
|
$288,297
|
$(1,729)
|
$(6,300)
|
$5,150,076
|
$280,268
|
|
March 31, 2018
|
December 31, 2017
|
||
|
Amortized
|
|
Amortized
|
|
Remaining Time to Maturity
|
Cost
|
Fair Value
|
Cost
|
Fair Value
|
|
|
|
||
Less
than one year
|
$123,000
|
$117,936
|
$-
|
$-
|
One
to five years
|
2,546,338
|
2,549,597
|
2,546,459
|
2,601,898
|
Five
to ten years
|
1,594,457
|
1,640,493
|
1,716,884
|
1,794,139
|
More
than 10 years
|
606,476
|
754,039
|
606,466
|
754,039
|
Total
|
$4,870,271
|
$5,062,065
|
$4,869,808
|
$5,150,076
|
|
Three
months ended
|
|
|
March
31,
|
|
|
2018
|
2017
|
Income:
|
|
|
Fixed-maturity
securities
|
$1,150,293
|
$745,453
|
Equity
securities
|
200,497
|
136,485
|
Cash and
cash equivalents
|
73,259
|
6,169
|
Total
|
1,424,049
|
888,107
|
Expenses:
|
|
|
Investment
expenses
|
40,060
|
30,307
|
Net
investment income
|
$1,383,989
|
$857,800
|
|
Three
months ended
|
|
|
March
31,
|
|
|
2018
|
2017
|
Realized Losses
|
|
|
|
|
|
Fixed-maturity
securities:
|
|
|
Gross realized
gains
|
$117,469
|
$13,123
|
Gross realized
losses (1)
|
(334,969)
|
(36,120)
|
|
(217,500)
|
(22,997)
|
|
|
|
Equity
securities:
|
|
|
Gross realized
gains
|
210,558
|
-
|
Gross realized
losses
|
(236,831)
|
(31,509)
|
|
(26,273)
|
(31,509)
|
|
|
|
Net realized
losses
|
(243,773)
|
(54,506)
|
|
|
|
Unrealized Losses
|
|
|
|
|
|
Equity
securities:
|
|
|
Gross
gains
|
-
|
-
|
Gross
losses
|
(307,214)
|
-
|
|
(307,214)
|
-
|
|
|
|
Other
investments:
|
|
|
Gross
gains
|
27,860
|
-
|
Gross
losses
|
-
|
-
|
|
27,860
|
-
|
|
|
|
Net
unrealized losses
|
(279,354)
|
-
|
|
|
|
Net loss on
investments
|
$(523,127)
|
$(54,506)
|
|
March 31, 2018
|
|||||||
|
Less than 12 months
|
12 months or more
|
Total
|
|||||
|
|
|
No. of
|
|
|
No. of
|
Aggregate
|
|
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Category
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
|
|
|||||||
Fixed-Maturity Securities:
|
|
|
|
|
|
|
|
|
U.S. Treasury
securities
|
|
|
|
|
|
|
|
|
and
obligations of U.S.
|
|
|
|
|
|
|
|
|
government
corporations
|
|
|
|
|
|
|
|
|
and
agencies
|
$4,943,730
|
$(20,282)
|
3
|
$-
|
$-
|
-
|
$4,943,730
|
$(20,282)
|
|
|
|
|
|
|
|
|
|
Political
subdivisions of
|
|
|
|
|
|
|
|
|
States,
Territories and
|
|
|
|
|
|
|
|
|
Possessions
|
3,716,760
|
(84,282)
|
7
|
-
|
-
|
-
|
3,716,760
|
(84,282)
|
|
|
|
|
|
|
|
|
|
Corporate
and other
|
|
|
|
|
|
|
|
|
bonds
industrial and
|
|
|
|
|
|
|
|
|
miscellaneous
|
67,818,785
|
(1,436,598)
|
83
|
8,059,700
|
(369,216)
|
16
|
75,878,485
|
(1,805,814)
|
|
|
|
|
|
|
|
|
|
Residential
mortgage and other
|
|
|
|
|
|
|
|
|
asset
backed securities
|
8,791,842
|
(104,872)
|
10
|
9,776,165
|
(312,583)
|
15
|
18,568,007
|
(417,455)
|
|
|
|
|
|
|
|
|
|
Total
fixed-maturity
|
|
|
|
|
|
|
|
|
securities
|
$85,271,117
|
$(1,646,034)
|
103
|
$17,835,865
|
$(681,799)
|
31
|
$103,106,982
|
$(2,327,833)
|
|
December 31, 2017
|
|||||||
|
Less than 12 months
|
12 months or more
|
Total
|
|||||
|
|
|
No. of
|
|
|
No. of
|
Aggregate
|
|
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Category
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
|
|
|||||||
Fixed-Maturity Securities:
|
|
|
|
|
|
|
|
|
Political
subdivisions of
|
|
|
|
|
|
|
|
|
States,
Territories and
|
|
|
|
|
|
|
|
|
Possessions
|
$1,549,839
|
$(30,814)
|
4
|
$-
|
$-
|
-
|
$1,549,839
|
$(30,814)
|
|
|
|
|
|
|
|
|
|
Corporate
and other
|
|
|
|
|
|
|
|
|
bonds
industrial and
|
|
|
|
|
|
|
|
|
miscellaneous
|
15,036,462
|
(269,857)
|
20
|
9,113,924
|
(340,516)
|
17
|
24,150,386
|
(610,373)
|
|
|
|
|
|
|
|
|
|
Residential
mortgage and other
|
|
|
|
|
|
|
|
|
asset
backed securities
|
6,956,371
|
(48,482)
|
6
|
7,867,572
|
(189,022)
|
15
|
14,823,943
|
(237,504)
|
|
|
|
|
|
|
|
|
|
Total
fixed-maturity
|
|
|
|
|
|
|
|
|
securities
|
$23,542,672
|
$(349,153)
|
30
|
$16,981,496
|
$(529,538)
|
32
|
$40,524,168
|
$(878,691)
|
|
|
|
|
|
|
|
|
|
Equity Securities:
|
|
|
|
|
|
|
|
|
Preferred
stocks
|
$1,605,217
|
$(20,313)
|
5
|
$1,776,675
|
$(120,712)
|
3
|
$3,381,892
|
$(141,025)
|
Common
stocks and
|
|
|
|
|
|
|
|
|
exchange
traded mutual funds
|
1,446,375
|
(222,205)
|
4
|
124,900
|
(14,530)
|
1
|
1,571,275
|
(236,735)
|
|
|
|
|
|
|
|
|
|
Total
equity securities
|
$3,051,592
|
$(242,518)
|
9
|
$1,901,575
|
$(135,242)
|
4
|
$4,953,167
|
$(377,760)
|
|
|
|
|
|
|
|
|
|
Total
|
$26,594,264
|
$(591,671)
|
39
|
$18,883,071
|
$(664,780)
|
36
|
$45,477,335
|
$(1,256,451)
|
|
March 31,
2018
|
|||
|
Level
1
|
Level
2
|
Level
3
|
Total
|
|
|
|||
Fixed-maturity
securities available-for-sale
|
|
|
|
|
U.S. Treasury
securities
|
|
|
|
|
and obligations of
U.S.
|
|
|
|
|
government
corporations
|
|
|
|
|
and
agencies
|
$4,943,730
|
$-
|
$-
|
$4,943,730
|
|
|
|
|
|
Political
subdivisions of
|
|
|
|
|
States,
Territories and
|
|
|
|
|
Possessions
|
-
|
6,555,925
|
-
|
6,555,925
|
|
|
|
|
|
Corporate
and other
|
|
|
|
|
bonds
industrial and
|
|
|
|
|
miscellaneous
|
90,969,165
|
4,325,251
|
-
|
95,294,416
|
|
|
|
|
|
Residential
mortgage backed securities
|
-
|
22,355,130
|
-
|
22,355,130
|
Total fixed
maturities
|
95,912,895
|
33,236,306
|
-
|
129,149,201
|
Equity
securities
|
16,600,485
|
-
|
-
|
16,600,485
|
Total
investments
|
$112,513,380
|
$33,236,306
|
$-
|
$145,749,686
|
|
December 31,
2017
|
|||
|
Level
1
|
Level
2
|
Level
3
|
Total
|
|
|
|||
Fixed-maturity
securities available-for-sale
|
|
|
|
|
Political
subdivisions of
|
|
|
|
|
States,
Territories and
|
|
|
|
|
Possessions
|
$-
|
$11,315,443
|
$-
|
$11,315,443
|
|
|
|
|
|
Corporate
and other
|
|
|
|
|
bonds
industrial and
|
|
|
|
|
miscellaneous
|
83,597,300
|
4,544,165
|
-
|
88,141,465
|
|
|
|
|
|
Residential
mortgage backed securities
|
-
|
20,531,348
|
-
|
20,531,348
|
Total fixed
maturities
|
83,597,300
|
36,390,956
|
-
|
119,988,256
|
Equity
securities
|
14,286,198
|
-
|
-
|
14,286,198
|
Total
investments
|
$97,883,498
|
$36,390,956
|
$-
|
$134,274,454
|
Category
|
March 31, 2018
|
December 31, 2017
|
Other Investments:
|
|
|
Hedge
fund
|
$2,027,860
|
$-
|
Total
|
$2,027,860
|
$-
|
|
March 31, 2018
|
December 31, 2017
|
||
|
Carrying Value
|
Fair Value
|
Carrying Value
|
Fair Value
|
|
|
|
|
|
Fixed-maturity
securities-held-to maturity
|
$4,870,271
|
$5,062,065
|
$4,869,808
|
$5,150,076
|
Cash
and cash equivalents
|
$31,594,167
|
$31,594,167
|
$48,381,633
|
$48,381,633
|
Investment
subscription receivable
|
$-
|
$-
|
$2,000,000
|
$2,000,000
|
Premiums
receivable, net
|
$13,065,874
|
$13,065,874
|
$13,217,698
|
$13,217,698
|
Reinsurance
receivables, net
|
$31,895,480
|
$31,895,480
|
$28,519,130
|
$28,519,130
|
Real
estate, net of accumulated depreciation
|
$2,231,999
|
$2,705,000
|
$2,261,829
|
$2,705,000
|
Reinsurance
balances payable
|
$3,017,734
|
$3,017,734
|
$2,563,966
|
$2,563,966
|
Long-term
debt, net
|
$29,163,116
|
$29,163,116
|
$29,126,965
|
$29,126,965
|
|
Direct
|
Assumed
|
Ceded
|
Net
|
Three
months ended March 31, 2018
|
|
|
|
|
Premiums
written
|
$31,526,283
|
$336
|
$(7,826,235)
|
$23,700,384
|
Change in
unearned premiums
|
(1,008,869)
|
1,901
|
144,201
|
(862,767)
|
Premiums
earned
|
$30,517,414
|
$2,237
|
$(7,682,034)
|
$22,837,617
|
|
|
|
|
|
Three
months ended March 31, 2017
|
|
|
|
|
Premiums
written
|
$26,125,467
|
$4,428
|
$(9,395,590)
|
$16,734,305
|
Change in
unearned premiums
|
(330,903)
|
2,981
|
(36,635)
|
(364,557)
|
Premiums
earned
|
$25,794,564
|
$7,409
|
$(9,432,225)
|
$16,369,748
|
|
Three
months ended
|
|
|
March
31,
|
|
|
2018
|
2017
|
|
|
|
Balance at
beginning of period
|
$48,799,622
|
$41,736,719
|
Less reinsurance
recoverables
|
(16,748,908)
|
(15,776,880)
|
Net balance,
beginning of period
|
32,050,714
|
25,959,839
|
|
|
|
Incurred related
to:
|
|
|
Current
year
|
17,367,560
|
8,297,582
|
Prior
years
|
(101,230)
|
(4,586)
|
Total
incurred
|
17,266,330
|
8,292,996
|
|
|
|
Paid related
to:
|
|
|
Current
year
|
5,971,788
|
2,269,894
|
Prior
years
|
6,495,154
|
4,090,766
|
Total
paid
|
12,466,942
|
6,360,660
|
|
|
|
Net balance at end
of period
|
36,850,102
|
27,892,175
|
Add reinsurance
recoverables
|
19,422,011
|
16,719,411
|
Balance at end of
period
|
$56,272,113
|
$44,611,586
|
All Lines of Business
|
||||||||||||
(in thousands, except reported claims data)
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
As
of
|
|
|
Incurred Loss and Allocated Loss Adjustment Expenses, Net of
Reinsurance
|
March
31, 2018
|
||||||||||
Accident
|
For
the Years Ended December 31,
|
Three
Months Ended
March 31,
|
|
Cumulative Number of Reported Claims by
Accident
|
||||||||
Year
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
IBNR
|
Year
|
|
(Unaudited
2009 - 2015)
|
|
|
(Unaudited)
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
2009
|
$4,403
|
$4,254
|
$4,287
|
$4,384
|
$4,511
|
$4,609
|
$4,616
|
$4,667
|
$4,690
|
$4,689
|
$9
|
1,136
|
2010
|
|
5,598
|
5,707
|
6,429
|
6,623
|
6,912
|
6,853
|
6,838
|
6,840
|
6,840
|
(0)
|
1,616
|
2011
|
|
|
7,603
|
7,678
|
8,618
|
9,440
|
9,198
|
9,066
|
9,144
|
9,143
|
6
|
1,913
|
2012
|
|
|
|
9,539
|
9,344
|
10,278
|
10,382
|
10,582
|
10,790
|
10,777
|
31
|
4,702(1)
|
2013
|
|
|
|
|
10,728
|
9,745
|
9,424
|
9,621
|
10,061
|
10,030
|
220
|
1,558
|
2014
|
|
|
|
|
|
14,193
|
14,260
|
14,218
|
14,564
|
14,487
|
628
|
2,126
|
2015
|
|
|
|
|
|
|
22,340
|
21,994
|
22,148
|
22,065
|
1,007
|
2,535
|
2016
|
|
|
|
|
|
|
|
26,062
|
24,941
|
24,511
|
2,383
|
2,848
|
2017
|
|
|
|
|
|
|
|
|
31,605
|
32,125
|
4,605
|
3,268
|
2018
|
|
|
|
|
|
|
|
|
|
16,498
|
4,175
|
1,185
|
|
|
|
|
|
|
|
|
|
Total
|
$151,165
|
|
|
(1) Reported
claims for accident year 2012 includes 3,406 claims from Superstorm
Sandy.
|
All Lines of Business
|
|
|
||||||||||
(in thousands)
|
|
|
||||||||||
|
Cumulative Paid Loss and Allocated Loss Adjustment Expenses, Net of
Reinsurance
|
|
|
|||||||||
|
For
the Years Ended December 31,
|
Three
Months Ended
March 31,
|
|
|
||||||||
Accident Year
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
|
|
|
(Unaudited 2009 - 2015)
|
|
|
(Unaudited)
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
2009
|
$2,298
|
$3,068
|
$3,607
|
$3,920
|
$4,134
|
$4,362
|
$4,424
|
$4,468
|
$4,487
|
$4,604
|
|
|
2010
|
|
2,566
|
3,947
|
4,972
|
5,602
|
6,323
|
6,576
|
6,720
|
6,772
|
6,772
|
|
|
2011
|
|
|
3,740
|
5,117
|
6,228
|
7,170
|
8,139
|
8,540
|
8,702
|
8,706
|
|
|
2012
|
|
|
|
3,950
|
5,770
|
7,127
|
8,196
|
9,187
|
10,236
|
10,290
|
|
|
2013
|
|
|
|
|
3,405
|
5,303
|
6,633
|
7,591
|
8,407
|
8,487
|
|
|
2014
|
|
|
|
|
|
5,710
|
9,429
|
10,738
|
11,770
|
12,038
|
|
|
2015
|
|
|
|
|
|
|
12,295
|
16,181
|
18,266
|
18,495
|
|
|
2016
|
|
|
|
|
|
|
|
15,364
|
19,001
|
19,294
|
|
|
2017
|
|
|
|
|
|
|
|
|
16,704
|
21,849
|
|
|
2018
|
|
|
|
|
|
|
|
|
|
5,641
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
$116,176
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
liability for unpaid loss and allocated loss adjustment expenses
for the accident years presented
|
$34,990
|
|
|
|||||||||
All
outstanding liabilities before 2009, net of
reinsurance
|
|
222
|
|
|
||||||||
Liabilities
for loss and allocated loss adjustment expenses, net of
reinsurance
|
$35,212
|
|
|
Reconciliation
of the Disclosure of Incurred and Paid Loss
Development
|
|
to
the Liability for Loss and LAE Reserves
|
|
|
As
of
|
(in thousands)
|
March 31,
2018
|
Liabilities for
allocated loss and loss adjustment expenses, net of
reinsurance
|
$35,212
|
Total reinsurance
recoverable on unpaid losses
|
19,422
|
Unallocated loss
adjustment expenses
|
1,638
|
Total gross
liability for loss and LAE reserves
|
$56,272
|
|
Treaty
Year
|
|
|
July 1,
2017
|
July 1,
2016
|
|
to
|
to
|
Line of
Business
|
June 30,
2018
|
June 30,
2017
|
|
|
|
Personal Lines:
|
|
|
Homeowners,
dwelling fire and canine legal liability
|
|
|
Quota share
treaty:
|
|
|
Percent
ceded
|
20%
|
40%
|
Risk
retained
|
$800,000
|
$500,000
|
Losses per
occurrence subject to quota share reinsurance coverage
|
$1,000,000
|
$833,333
|
Excess of
loss coverage and facultative facility above quota share coverage
(1)
|
$9,000,000
|
$3,666,667
|
|
in excess
of
|
in excess
of
|
|
$1,000,000
|
$833,333
|
Total
reinsurance coverage per occurrence
|
$9,200,000
|
$4,000,000
|
Losses per
occurrence subject to reinsurance coverage
|
$10,000,000
|
$4,500,000
|
Expiration
date
|
June
30, 2019
|
June 30,
2017
|
|
|
|
Personal
Umbrella
|
|
|
Quota share
treaty:
|
|
|
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, 2018
|
June 30,
2017
|
|
|
|
Commercial Lines:
|
|
|
General
liability commercial policies
|
|
|
Quota share
treaty:
|
|
|
Percent
ceded
|
None
|
None
|
Risk
retained
|
$750,000
|
$500,000
|
Losses per
occurrence subject to quota share reinsurance coverage
|
None
|
None
|
Excess of
loss coverage above quota share coverage
|
$3,750,000
|
$4,000,000
|
|
in excess
of
|
in excess
of
|
|
$750,000
|
$500,000
|
Total
reinsurance coverage per occurrence
|
$3,750,000
|
$4,000,000
|
Losses per
occurrence subject to reinsurance coverage
|
$4,500,000
|
$4,500,000
|
|
|
|
Commercial
Umbrella
|
|
|
Quota share
treaty:
|
|
|
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, 2018
|
June 30,
2017
|
|
|
|
Catastrophe Reinsurance:
|
|
|
Initial loss
subject to personal lines quota share treaty
|
$5,000,000
|
$5,000,000
|
Risk retained
per catastrophe occurrence (2)
|
$4,000,000
|
$3,000,000
|
Catastrophe
loss coverage in excess of quota share coverage (3)
|
$315,000,000
|
$247,000,000
|
Reinstatement
premium protection (4)
|
Yes
|
Yes
|
|
|
July 1, 2017 -
June 30, 2018
|
|
July 1, 2016 -
June 30, 2017
|
||||
Treaty
|
|
Range of
Loss
|
|
Risk
Retained
|
|
Range of
Loss
|
|
Risk
Retained
|
Personal
Lines (1)
|
|
Initial
$1,000,000
|
|
$800,000
|
|
Initial
$833,333
|
|
$500,000
|
|
|
$1,000,000
- $10,000,000
|
|
None(2)
|
|
$833,333
- $4,500,000
|
|
None(3)
|
|
|
Over
$10,000,000
|
|
100%
|
|
Over
$4,500,000
|
|
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
$500,000
|
|
$500,000
|
|
|
$750,000
- $4,500,000
|
|
None(3)
|
|
$500,000
- $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
|
|
$4,000,000
|
|
Initial
$5,000,000
|
|
$3,000,000
|
|
|
$5,000,000
- $320,000,000
|
None
|
|
$5,000,000
- $252,000,000
|
None
|
||
|
|
Over
$320,000,000
|
|
100%
|
|
Over
$252,000,000
|
|
100%
|
|
Three
months ended
|
|
|
March
31,
|
|
|
2018
|
2017
|
|
|
|
Provisional
ceding commissions earned
|
$2,067,505
|
$3,343,769
|
Contingent
ceding commissions earned
|
(372,347)
|
(159,317)
|
|
$1,695,158
|
$3,184,452
|
5.50%
Senior Unsecured Notes
|
$30,000,000
|
Discount
|
(154,098)
|
Issuance
costs
|
(682,786)
|
Long-term
debt, net
|
$29,163,116
|
Stock Options
|
Number of Shares
|
Weighted Average Exercise Price per Share
|
Weighted Average Remaining Contractual Term
|
Aggregate Intrinsic Value
|
|
|
|
|
|
Outstanding
at January 1, 2018
|
341,150
|
$6.69
|
1.67
|
$4,131,028
|
|
|
|
|
|
Granted
|
-
|
$-
|
|
$-
|
Exercised
|
(90,500)
|
$6.40
|
-
|
$1,366,780
|
Forfeited
|
-
|
$-
|
|
$-
|
|
|
|
|
|
Outstanding
at March 31, 2018
|
250,650
|
$6.80
|
1.51
|
$2,507,198
|
|
|
|
|
|
Vested
and Exercisable at March 31, 2018
|
240,650
|
$6.73
|
1.43
|
$2,422,460
|
Restricted Stock
Awards
|
Shares
|
Weighted Average Grant Date Fair Value per Share
|
Aggregate Fair Value
|
|
|
|
|
Balance
at January 1, 2018
|
47,337
|
$14.35
|
$679,180
|
|
|
|
|
Granted
|
61,215
|
$20.68
|
$1,266,090
|
Vested
|
(7,180)
|
$12.90
|
$(92,652)
|
Forfeited
|
-
|
$-
|
$-
|
|
|
|
|
Balance at March
31, 2018
|
101,372
|
$18.28
|
$1,852,618
|
|
March
31,
|
December
31,
|
|
2018
|
2017
|
|
|
|
Deferred tax
asset:
|
|
|
Net operating
loss carryovers (1)
|
$87,018
|
$103,655
|
Claims
reserve discount
|
344,928
|
300,005
|
Unearned
premium
|
2,498,571
|
2,431,301
|
Deferred
ceding commission revenue
|
913,041
|
895,947
|
Other
|
185,752
|
382,522
|
Total
deferred tax assets
|
4,029,310
|
4,113,430
|
|
|
|
Deferred tax
liability:
|
|
|
Investment in
KICO (2)
|
759,543
|
759,543
|
Deferred
acquisition costs
|
3,177,345
|
3,117,920
|
Intangibles
|
194,250
|
212,100
|
Depreciation
and amortization
|
285,371
|
328,735
|
Net
unrealized (loss) gains of securities - available for
sale
|
(310,168)
|
295,474
|
Total
deferred tax liabilities
|
4,106,341
|
4,713,772
|
|
|
|
Net deferred
income tax liability
|
$(77,031)
|
$(600,342)
|
|
March 31,
|
December 31,
|
|
Type of
NOL
|
2018
|
2017
|
Expiration
|
State
only (A)
|
$924,217
|
$824,996
|
December
31, 2038
|
Valuation
allowance
|
(839,299)
|
(725,541)
|
|
State
only, net of valuation allowance
|
84,918
|
99,455
|
|
Amount
subject to Annual Limitation, federal only (B)
|
2,100
|
4,200
|
December
31, 2019
|
Total
deferred tax asset from net operating loss carryovers
|
$87,018
|
$103,655
|
|
|
Three
months ended
|
|
|
March
31,
|
|
|
2018
|
2017
|
|
|
|
Weighted average
number of shares outstanding
|
10,669,992
|
9,663,751
|
|
|
|
Effect of dilutive
securities, common share equivalents:
|
|
|
Stock
options
|
-
|
184,743
|
Restricted
stock awards
|
-
|
-
|
|
|
|
Weighted average
number of shares outstanding,
|
|
|
used for
computing diluted (losses) earnings per share
|
10,669,992
|
9,848,494
|
For the Year
|
|
Ending
|
|
December 31,
|
Total
|
2018
(nine months)
|
$124,137
|
2019
|
169,861
|
2020
|
175,806
|
2021
|
181,959
|
2022
|
188,328
|
Thereafter
|
244,064
|
Total
|
$1,084,155
|
|
Three
months ended March 31,
|
|||
($
in thousands)
|
2018
|
2017
|
Change
|
Percent
|
Revenues
|
|
|
|
|
Direct
written premiums
|
$31,526
|
$26,125
|
$5,401
|
20.7%
|
Assumed
written premiums
|
-
|
4
|
(4)
|
(100.0)%
|
|
31,526
|
26,129
|
5,397
|
20.7%
|
Ceded
written premiums
|
|
|
|
|
Ceded
to quota share treaties
|
4,406
|
6,542
|
(2,136)
|
(32.7)%
|
Ceded
to excess of loss treaties
|
288
|
311
|
(23)
|
(7.4)%
|
Ceded
to catastrophe treaties
|
3,132
|
2,542
|
590
|
23.2%
|
Total
ceded written premiums
|
7,826
|
9,395
|
(1,569)
|
(16.7)%
|
|
|
|
|
|
Net
written premiums
|
23,700
|
16,734
|
6,966
|
41.6%
|
|
|
|
|
|
Change
in unearned premiums
|
|
|
|
|
Direct
and assumed
|
(1,007)
|
(328)
|
(679)
|
207.0%
|
Ceded
to quota share treaties
|
144
|
(37)
|
181
|
(489.2)%
|
Change
in net unearned premiums
|
(863)
|
(365)
|
(498)
|
136.4%
|
|
|
|
|
|
Premiums
earned
|
|
|
|
|
Direct
and assumed
|
30,520
|
25,802
|
4,718
|
18.3%
|
Ceded
to quota share treaties
|
(7,682)
|
(9,432)
|
1,750
|
(18.6)%
|
Net
premiums earned
|
22,838
|
16,370
|
6,468
|
39.5%
|
Ceding
commission revenue
|
|
|
|
|
Excluding
the effect of catastrophes
|
2,029
|
3,184
|
(1,155)
|
(36.3)%
|
Effect
of catastrophes
|
(334)
|
-
|
(334)
|
n/a
|
Total
ceding commission revenue
|
1,695
|
3,184
|
(1,489)
|
(46.8)%
|
Net
investment income
|
1,384
|
858
|
526
|
61.3%
|
Net
losses on investments
|
(523)
|
(55)
|
(468)
|
850.9%
|
Other
income
|
308
|
290
|
18
|
6.2%
|
Total
revenues
|
25,702
|
20,647
|
5,055
|
24.5%
|
Expenses
|
|
|
|
|
Loss
and loss adjustment expenses
|
|
|
|
|
Direct
and assumed:
|
|
|
|
|
Loss
and loss adjustment expenses excluding the effect of
catastrophes
|
12,541
|
12,527
|
14
|
0.1%
|
Losses
from catastrophes (1)
|
10,337
|
-
|
10,337
|
n/a
|
Total
direct and assumed loss and loss adjustment expenses
|
22,878
|
12,527
|
10,351
|
82.6%
|
|
|
|
|
|
Ceded
loss and loss adjustment expenses:
|
|
|
|
|
Loss
and loss adjustment expenses excluding the effect of
catastrophes
|
821
|
4,234
|
(3,413)
|
(80.6)%
|
Losses
from catastrophes (1)
|
4,791
|
-
|
4,791
|
n/a
|
Total
ceded loss and loss adjustment expenses
|
5,612
|
4,234
|
1,378
|
32.5%
|
|
|
|
|
|
Net
loss and loss adjustment expenses:
|
|
|
|
|
Loss
and loss adjustment expenses excluding the effect of
catastrophes
|
11,720
|
8,293
|
3,427
|
41.3%
|
Losses
from catastrophes (1)
|
5,546
|
-
|
5,546
|
n/a
|
Net
loss and loss adjustment expenses
|
17,266
|
8,293
|
8,973
|
108.2%
|
|
|
|
|
|
Commission
expense
|
5,800
|
4,889
|
911
|
18.6%
|
Other
underwriting expenses
|
5,031
|
4,212
|
819
|
19.4%
|
Other
operating expenses
|
247
|
756
|
(509)
|
(67.3)%
|
Depreciation
and amortization
|
409
|
319
|
90
|
28.2%
|
Interest
expense
|
457
|
-
|
457
|
n/a
|
Total
expenses
|
29,211
|
18,469
|
10,742
|
58.2%
|
|
|
|
|
|
(Loss)
income from operations before taxes
|
(3,509)
|
2,178
|
(5,687)
|
(261.1)%
|
Income
tax (benefit) expense
|
(791)
|
708
|
(1,499)
|
(211.7)%
|
Net (loss) income
|
$(2,718)
|
$1,470
|
$(4,188)
|
(284.9)%
|
|
Three months ended March 31,
|
|||
|
2018
|
2017
|
Percentage
Point Change
|
Percent
Change
|
|
|
|
|
|
Key ratios:
|
|
|
|
|
Net
loss ratio
|
75.6%
|
50.7%
|
24.9
|
49.1%
|
Net
underwriting expense ratio
|
38.7%
|
34.5%
|
4.2
|
12.2%
|
Net
combined ratio
|
114.3%
|
85.2%
|
29.1
|
34.2%
|
|
Three
months ended March 31,
|
||||
|
|
2018
|
|
|
2017
|
|
|
("2017/2019
Treaty")
|
|
|
("2016/2017
Treaty")
|
|
|
|
|
|
|
Quota share reinsurance rates
|
|
|
|
|
|
Personal
lines
|
|
20%
|
|
|
40%
|
|
Three months
ended
|
||
|
March
31,
|
||
|
2018
|
|
2017
|
|
("2017/2019
Treaty")
|
|
("2016/2017
Treaty")
|
|
|
|
|
Provisional ceding commission rate on quota share
treaty
|
|
|
|
Personal
lines
|
53%
|
|
52%
|
|
Three months ended March 31,
|
|||
($ in thousands)
|
2018
|
2017
|
Change
|
Percent
|
|
|
|
|
|
Provisional
ceding commissions earned
|
$2,067
|
$3,343
|
$(1,276)
|
(38.2)%
|
|
|
|
|
|
Contingent
ceding commissions earned
|
|
|
|
|
Contingent
ceding commissions earned excluding
|
|
|
|
|
the
effect of catastrophes
|
(38)
|
(159)
|
121
|
(76.1)%
|
Effect
of catastrophes on ceding commissions earned
|
(334)
|
-
|
(334)
|
n/a
|
Contingent
ceding commissions earned
|
(372)
|
(159)
|
(213)
|
134.0%
|
|
|
|
|
|
Total
ceding commission revenue
|
$1,695
|
$3,184
|
$(1,489)
|
(46.8)%
|
|
Three months ended
|
$ or
|
|
|
March 31,
|
Point
|
|
|
2018
|
2017
|
Change
|
|
|
|
|
Net
premiums earned
|
|
|
|
Core
|
$22,456
|
$16,370
|
$6,086
|
Expansion
|
382
|
-
|
382
|
Total
|
$22,838
|
$16,370
|
$6,468
|
|
|
|
|
Other
underwriting expenses
|
|
|
|
Core
|
$4,642
|
$3,982
|
$660
|
Expansion
|
390
|
230
|
160
|
Total
|
$5,032
|
$4,212
|
$820
|
|
|
|
|
Other
underwriting expenses as a percentage
|
|
|
|
of
net premiums earned
|
|
|
|
Core
|
20.7%
|
24.3%
|
-3.6%
|
Expansion
|
102.1%
|
na
|
na
|
Total
|
22.0%
|
25.7%
|
-3.7%
|
|
Three months ended
|
|
|
|
March 31,
|
Percentage
|
|
|
2018
|
2017
|
Point Change
|
|
|
|
|
Ceding
commission revenue - provisional
|
(9.1)%
|
(20.4)%
|
11.3
|
Ceding
commission revenue - contingent
|
1.6
|
1.0
|
0.6
|
Other
income
|
(1.3)
|
(1.6)
|
0.3
|
Acquisition
costs and other underwriting expenses:
|
|
|
|
Commission
expense
|
25.4
|
29.9
|
(4.5)
|
|
16.6
|
8.9
|
7.7
|
Other
underwriting expenses
|
|
|
|
Core
|
|
|
|
Employment
costs
|
8.7
|
10.5
|
(1.8)
|
Other
Core Expenses
|
11.7
|
13.7
|
(2.0)
|
Total
Core Expenses
|
20.4
|
24.2
|
(3.8)
|
Expansion
Expenses
|
1.7
|
1.4
|
0.3
|
Total
other underwriting expenses
|
22.1
|
25.6
|
(3.5)
|
|
|
|
|
Net
underwriting expense ratio
|
38.7%
|
34.5%
|
4.2
|
|
For the three months ended
|
|
|
March 31,
|
|
|
2018
|
2017
|
|
|
|
Gross
premiums written:
|
|
|
Personal
lines
|
$24,825,452
|
$19,461,972
|
Commercial
lines
|
4,286,391
|
3,584,054
|
Livery
physical damage
|
2,354,070
|
3,026,483
|
Other(1)
|
60,706
|
57,386
|
Total
|
$31,526,619
|
$26,129,895
|
|
|
|
Net
premiums written:
|
|
|
Personal
lines
|
17,443,911
|
10,466,368
|
Commercial
lines
|
3,852,371
|
3,202,565
|
Livery
physical damage
|
2,354,070
|
3,026,483
|
Other(1)
|
50,032
|
38,889
|
Total
|
$23,700,384
|
$16,734,305
|
|
|
|
Net
premiums earned:
|
|
|
Personal
lines
|
$17,040,256
|
$10,690,583
|
Commercial
lines
|
3,229,970
|
2,842,580
|
Livery
physical damage
|
2,520,684
|
2,792,347
|
Other(1)
|
46,707
|
44,238
|
Total
|
$22,837,617
|
$16,369,748
|
|
|
|
Net
loss and loss adjustment expenses(2):
|
|
|
Personal
lines
|
$12,961,206
|
$5,352,112
|
Commercial
lines
|
2,449,598
|
1,528,796
|
Livery
physical damage
|
1,164,081
|
965,522
|
Other(1)
|
58,674
|
(52,074)
|
Unallocated
loss adjustment expenses
|
632,771
|
498,640
|
Total
|
$17,266,330
|
$8,292,996
|
|
|
|
Net
loss ratio(2):
|
|
|
Personal
lines
|
76.1%
|
50.1%
|
Commercial
lines
|
75.8%
|
53.8%
|
Livery
physical damage
|
46.2%
|
34.6%
|
Other(1)
|
125.6%
|
-117.7%
|
Total
|
75.6%
|
50.7%
|
|
Three months
ended
|
|
|
March
31,
|
|
|
2018
|
2017
|
|
|
|
Revenues
|
|
|
Net
premiums earned
|
$22,837,617
|
$16,369,748
|
Ceding
commission revenue
|
1,695,158
|
3,184,452
|
Net
investment income
|
1,383,989
|
857,800
|
Net
losses on investments
|
(523,127)
|
(54,506)
|
Other
income
|
292,222
|
267,376
|
Total
revenues
|
25,685,860
|
20,624,870
|
|
|
|
Expenses
|
|
|
Loss
and loss adjustment expenses
|
17,266,330
|
8,292,996
|
Commission
expense
|
5,799,948
|
4,888,978
|
Other
underwriting expenses
|
5,031,503
|
4,212,417
|
Depreciation
and amortization
|
409,431
|
318,698
|
Total
expenses
|
28,507,212
|
17,713,089
|
|
|
|
(Loss)
income from operations
|
(2,821,353)
|
2,911,781
|
Income
tax (benefit) expense
|
(610,280)
|
955,141
|
Net (loss) income
|
$(2,211,073)
|
$1,956,640
|
|
|
|
Key Measures:
|
|
|
Net
loss ratio
|
75.6%
|
50.7%
|
Net
underwriting expense ratio
|
38.7%
|
34.5%
|
Net
combined ratio
|
114.3%
|
85.2%
|
|
|
|
Reconciliation
of net underwriting expense ratio:
|
|
|
Acquisition
costs and other
|
|
|
underwriting
expenses
|
$10,831,451
|
$9,101,395
|
Less:
Ceding commission revenue
|
(1,695,158)
|
(3,184,452)
|
Less:
Other income
|
(292,222)
|
(267,376)
|
Net
underwriting expenses
|
$8,844,071
|
$5,649,567
|
|
|
|
Net
premiums earned
|
$22,837,617
|
$16,369,748
|
|
|
|
Net
Underwriting Expense Ratio
|
38.7%
|
34.5%
|
|
Direct
|
Assumed
|
Ceded
|
Net
|
|
|
|
|
|
Three
months ended March 31, 2018
|
|
|
|
|
Written
premiums
|
$31,526,283
|
$336
|
$(7,826,235)
|
$23,700,384
|
Change in
unearned premiums
|
(1,008,869)
|
1,901
|
144,201
|
(862,767)
|
Earned
premiums
|
$30,517,414
|
$2,237
|
$(7,682,034)
|
$22,837,617
|
|
|
|
|
|
Loss and loss
adjustment expenses exluding
|
|
|
|
|
the effect of
catastrophes
|
$12,519,241
|
$21,415
|
$(821,175)
|
$11,719,481
|
Catastrophe
loss
|
10,337,730
|
-
|
(4,790,881)
|
5,546,849
|
Loss and loss
adjustment expenses
|
$22,856,971
|
$21,415
|
$(5,612,056)
|
$17,266,330
|
|
|
|
|
|
Loss ratio
excluding the effect of catastrophes
|
41.0%
|
957.3%
|
10.7%
|
51.3%
|
Catastrophe
loss
|
33.9%
|
0.0%
|
62.4%
|
24.3%
|
Loss
ratio
|
74.9%
|
957.3%
|
73.1%
|
75.6%
|
|
|
|
|
|
Three
months ended March 31, 2017
|
|
|
|
|
Written
premiums
|
$26,125,467
|
$4,428
|
$(9,395,590)
|
$16,734,305
|
Change in
unearned premiums
|
(330,903)
|
2,981
|
(36,635)
|
(364,557)
|
Earned
premiums
|
$25,794,564
|
$7,409
|
$(9,432,225)
|
$16,369,748
|
|
|
|
|
|
Loss and loss
adjustment expenses exluding
|
|
|
|
|
the effect of
catastrophes
|
$12,518,760
|
$8,040
|
$(4,233,804)
|
$8,292,996
|
Catastrophe
loss
|
-
|
-
|
-
|
-
|
Loss and loss
adjustment expenses
|
$12,518,760
|
$8,040
|
$(4,233,804)
|
$8,292,996
|
|
|
|
|
|
Loss ratio
excluding the effect of catastrophes
|
48.5%
|
108.5%
|
44.9%
|
50.7%
|
Catastrophe
loss
|
0.0%
|
0.0%
|
0.0%
|
0.0%
|
Loss
ratio
|
48.5%
|
108.5%
|
44.9%
|
50.7%
|
|
Three months ended
|
|
|
March 31,
|
|
|
2018
|
2017
|
|
|
|
Net
premiums earned
|
$22,837,617
|
$16,369,748
|
Ceding
commission revenue
|
1,695,158
|
3,184,452
|
Other
income
|
292,222
|
267,376
|
|
|
|
Loss
and loss adjustment expenses (1)
|
17,266,330
|
8,292,996
|
|
|
|
Acquisition
costs and other underwriting expenses:
|
|
|
Commission
expense
|
5,799,948
|
4,888,978
|
Other
underwriting expenses
|
5,031,503
|
4,212,417
|
Total
acquisition costs and other
|
|
|
underwriting
expenses
|
10,831,451
|
9,101,395
|
|
|
|
Underwriting
income
|
$(3,272,784)
|
$2,427,185
|
|
|
|
Key
Measures:
|
|
|
Net
loss ratio excluding the effect of catastrophes
|
51.3%
|
50.7%
|
Effect
of catastrophe loss on net loss ratio (1)
|
24.3%
|
0.0%
|
Net
loss ratio
|
75.6%
|
50.7%
|
|
|
|
Net
underwriting expense ratio excluding the
|
|
|
effect
of catastrophes
|
37.4%
|
34.5%
|
Effect
of catastrophe loss on net underwriting
|
|
|
expense
ratio (2)
|
1.3%
|
0.0%
|
Net
underwriting expense ratio
|
38.7%
|
34.5%
|
|
|
|
Net
combined ratio excluding the effect
|
|
|
of
catastrophes
|
88.7%
|
85.2%
|
Effect
of catastrophe loss on net combined
|
|
|
ratio
(1) (2)
|
25.6%
|
0.0%
|
Net
combined ratio
|
114.3%
|
85.2%
|
|
|
|
Reconciliation
of net underwriting expense ratio:
|
|
|
Acquisition
costs and other
|
|
|
underwriting
expenses
|
$10,831,451
|
$9,101,395
|
Less:
Ceding commission revenue (2)
|
(1,695,158)
|
(3,184,452)
|
Less:
Other income
|
(292,222)
|
(267,376)
|
|
$8,844,071
|
$5,649,567
|
|
|
|
Net
earned premium
|
$22,837,617
|
$16,369,748
|
|
|
|
Net
Underwriting Expense Ratio
|
38.7%
|
34.5%
|
|
March 31, 2018
|
|||||
|
|
|
|
|
|
Net
|
|
Cost or
|
Gross
|
Gross
Unrealized Losses
|
|
Unrealized
|
|
|
Amortized
|
Unrealized
|
Less
than 12
|
More
than 12
|
Fair
|
Gains/
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
(Losses)
|
|
|
|||||
Fixed-Maturity Securities:
|
|
|
|
|
|
|
U.S.
Treasury securities and
|
|
|
|
|
|
|
obligations
of U.S. government
|
|
|
|
|
|
|
corporations
and agencies
|
$4,964,012
|
$-
|
$(20,282)
|
$-
|
$4,943,730
|
$(20,282)
|
|
|
|
|
|
|
|
Political
subdivisions of States,
|
|
|
|
|
|
|
Territories
and Possessions
|
6,591,252
|
48,955
|
(84,282)
|
-
|
6,555,925
|
(35,327)
|
|
|
|
|
|
|
|
Corporate
and other bonds
|
|
|
|
|
|
|
Industrial
and miscellaneous
|
96,910,715
|
189,515
|
(1,436,598)
|
(369,216)
|
95,294,416
|
(1,616,299)
|
|
|
|
|
|
|
|
Residential
mortgage and other
|
|
|
|
|
|
|
asset
backed securities (1)
|
22,446,778
|
325,807
|
(104,872)
|
(312,583)
|
22,355,130
|
(91,648)
|
Total
|
$130,912,757
|
$564,277
|
$(1,646,034)
|
$(681,799)
|
$129,149,201
|
$(1,763,556)
|
|
December 31, 2017
|
|||||
|
|
|
|
|
|
Net
|
|
Cost
or
|
Gross
|
Gross Unrealized Losses
|
|
Unrealized
|
|
|
Amortized
|
Unrealized
|
Less
than 12
|
More than
12
|
Fair
|
Gains/
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
(Losses)
|
|
|
|
|
|
|
|
Fixed-Maturity Securities:
|
|
|
|
|
|
|
U.S.
Treasury securities and
|
|
|
|
|
|
|
obligations
of U.S. government
|
|
|
|
|
|
|
corporations
and agencies
|
$-
|
$-
|
$-
|
$-
|
$-
|
$-
|
|
|
|
|
|
|
|
Political
subdivisions of States,
|
|
|
|
|
|
|
Territories
and Possessions
|
11,096,122
|
250,135
|
(30,814)
|
-
|
11,315,443
|
219,321
|
|
|
|
|
|
|
|
Corporate
and other bonds
|
|
|
|
|
|
|
Industrial
and miscellaneous
|
87,562,631
|
1,189,207
|
(269,857)
|
(340,516)
|
88,141,465
|
578,834
|
|
|
|
|
|
|
|
Residential
mortgage and other
|
|
|
|
|
|
|
asset
backed securities (1)
|
20,463,353
|
305,499
|
(48,482)
|
(189,022)
|
20,531,348
|
67,995
|
Total
|
$119,122,106
|
$1,744,841
|
$(349,153)
|
$(529,538)
|
$119,988,256
|
$866,150
|
|
March 31, 2018
|
|||||
|
|
|
|
|
|
Net
|
|
|
Gross
|
Gross
Unrealized Losses
|
|
Unrealized
|
|
|
|
Unrealized
|
Less
than 12
|
More
than 12
|
Fair
|
Gains/
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
(Losses)
|
|
|
|||||
Equity Securities:
|
|
|
|
|
|
|
Preferred
stocks
|
$7,301,491
|
$25,807
|
$(97,834)
|
$(116,287)
|
$7,113,177
|
$(188,314)
|
Common
stocks and exchange
|
|
|
|
|
|
|
traded
mutual funds
|
9,081,851
|
683,494
|
(278,037)
|
-
|
9,487,308
|
405,457
|
Total
|
$16,383,342
|
$709,301
|
$(375,871)
|
$(116,287)
|
$16,600,485
|
$217,143
|
|
December 31, 2017
|
|||||
|
|
|
|
|
|
Net
|
|
|
Gross
|
Gross
Unrealized Losses
|
|
Unrealized
|
|
|
|
Unrealized
|
Less
than 12
|
More
than 12
|
Fair
|
Gains/
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
(Losses)
|
|
|
|||||
Equity Securities:
|
|
|
|
|
|
|
Preferred
stocks
|
$7,081,099
|
$60,867
|
$(20,313)
|
$(120,712)
|
$7,000,941
|
$(80,158)
|
Common
stocks and exchange
|
|
|
|
|
|
|
traded
mutual funds
|
6,680,742
|
841,250
|
(222,205)
|
(14,530)
|
7,285,257
|
604,515
|
Total
|
$13,761,841
|
$902,117
|
$(242,518)
|
$(135,242)
|
$14,286,198
|
$524,357
|
|
March 31, 2018
|
December 31, 2017
|
||||
|
|
|
|
|
|
|
|
|
Fair
|
Unrealized
|
|
Fair
|
Unrealized
|
Category
|
Cost
|
Value
|
Gain
|
Cost
|
Value
|
Gain
|
|
|
|
|
|
||
Other Investments:
|
|
|
|
|
|
|
Hedge
fund
|
$2,000,000
|
$2,027,860
|
$27,860
|
$-
|
$-
|
$-
|
Total
|
$2,000,000
|
$2,027,860
|
$27,860
|
$-
|
$-
|
$-
|
|
March 31, 2018
|
|||||
|
|
|
|
|
|
|
|
Cost or
|
Gross
|
Gross
Unrealized Losses
|
|
Net
|
|
|
Amortized
|
Unrealized
|
Less
than 12
|
More
than 12
|
Fair
|
Unrealized
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
Gains
|
|
|
|
|
|
|
|
U.S.
Treasury securities
|
$729,476
|
$147,563
|
$(5,064)
|
$-
|
$871,975
|
$142,499
|
|
|
|
|
|
|
|
Political
subdivisions of States,
|
|
|
|
|
|
|
Territories
and Possessions
|
998,941
|
32,014
|
-
|
-
|
1,030,955
|
32,014
|
|
|
|
|
|
|
|
Corporate
and other bonds
|
|
|
|
|
|
|
Industrial
and miscellaneous
|
3,141,854
|
43,177
|
(15,741)
|
(10,155)
|
3,159,135
|
17,281
|
|
|
|
|
|
|
|
Total
|
$4,870,271
|
$222,754
|
$(20,805)
|
$(10,155)
|
$5,062,065
|
$191,794
|
|
December 31, 2017
|
|||||
|
|
|
|
|
|
|
|
Cost or
|
Gross
|
Gross
Unrealized Losses
|
|
Net
|
|
|
Amortized
|
Unrealized
|
Less
than 12
|
More
than 12
|
Fair
|
Unrealized
|
Category
|
Cost
|
Gains
|
Months
|
Months
|
Value
|
Gains
|
|
|
|||||
|
|
|
|
|
|
|
U.S.
Treasury securities
|
$729,466
|
$147,573
|
$(1,729)
|
$-
|
$875,310
|
$145,844
|
|
|
|
|
|
|
|
Political
subdivisions of States,
|
|
|
|
|
|
|
Territories
and Possessions
|
998,984
|
50,366
|
-
|
-
|
1,049,350
|
50,366
|
|
|
|
|
|
|
|
Corporate
and other bonds
|
|
|
|
|
|
|
Industrial
and miscellaneous
|
3,141,358
|
90,358
|
-
|
(6,300)
|
3,225,416
|
84,058
|
|
|
|
|
|
|
|
Total
|
$4,869,808
|
$288,297
|
$(1,729)
|
$(6,300)
|
$5,150,076
|
$280,268
|
|
March 31, 2018
|
December 31, 2017
|
||
|
Amortized
|
|
Amortized
|
|
Remaining Time to Maturity
|
Cost
|
Fair
Value
|
Cost
|
Fair
Value
|
|
|
|
||
Less
than one year
|
$123,000
|
$117,936
|
$-
|
$-
|
One
to five years
|
2,546,338
|
2,549,597
|
2,546,459
|
2,601,898
|
Five
to ten years
|
1,594,457
|
1,640,493
|
1,716,884
|
1,794,139
|
More
than 10 years
|
606,476
|
754,039
|
606,466
|
754,039
|
Total
|
$4,870,271
|
$5,062,065
|
$4,869,808
|
$5,150,076
|
|
March
31, 2018
|
December 31,
2017
|
||
|
|
Percentage
of
|
|
Percentage
of
|
|
Fair
Market
|
Fair
Market
|
Fair
Market
|
Fair
Market
|
|
Value
|
Value
|
Value
|
Value
|
|
|
|
||
Rating
|
|
|
|
|
U.S. Treasury
securities
|
$4,943,730
|
3.8%
|
$-
|
0.0%
|
|
|
|
|
|
Corporate and
municipal bonds
|
|
|
|
|
AAA
|
990,443
|
0.8%
|
1,358,143
|
1.1%
|
AA
|
7,873,523
|
6.1%
|
11,319,057
|
9.4%
|
A
|
17,384,332
|
13.5%
|
17,199,631
|
14.3%
|
BBB
|
75,602,043
|
58.5%
|
68,704,768
|
57.3%
|
BB
|
-
|
0.0%
|
875,310
|
0.7%
|
Total corporate
and municipal bonds
|
101,850,341
|
78.9%
|
99,456,909
|
82.8%
|
|
|
|
|
|
Residential
mortgage backed securities
|
|
|
|
|
AAA
|
2,009,760
|
1.6%
|
2,013,010
|
1.7%
|
AA
|
13,007,328
|
10.0%
|
11,021,144
|
9.2%
|
A
|
3,890,193
|
3.0%
|
3,902,768
|
3.3%
|
CCC
|
2,217,654
|
1.7%
|
1,420,296
|
1.2%
|
CC
|
-
|
0.0%
|
120,742
|
0.1%
|
C
|
-
|
0.0%
|
28,963
|
0.0%
|
D
|
886,918
|
0.7%
|
1,659,479
|
1.4%
|
Non
rated
|
343,277
|
0.3%
|
364,945
|
0.3%
|
Total residential mortgage backed securities
|
22,355,130
|
17.3%
|
20,531,347
|
17.2%
|
|
|
|
|
|
Total
|
$129,149,201
|
100.0%
|
$119,988,256
|
100.0%
|
Category
|
March 31, 2018
|
December 31,
2017
|
U.S.
Treasury securities and
|
|
|
obligations
of U.S. government
|
|
|
corporations
and agencies
|
2.05%
|
3.32%
|
|
|
|
Political
subdivisions of States,
|
|
|
Territories
and Possessions
|
3.63%
|
3.49%
|
|
|
|
Corporate
and other bonds
|
|
|
Industrial
and miscellaneous
|
3.91%
|
3.98%
|
|
|
|
Residential
mortgage and other asset backed securities
|
2.66%
|
1.83%
|
|
|
|
Total
|
3.61%
|
3.58%
|
|
March 31, 2018
|
December 31, 2017
|
Weighted
average effective maturity
|
6.2
|
5.7
|
|
|
|
Weighted
average final maturity
|
8.0
|
7.8
|
|
|
|
Effective
duration
|
5.1
|
4.9
|
|
March 31,
2018
|
|||||||
|
Less than 12 months
|
|
12 months or more
|
|
Total
|
|||
|
|
|
No. of
|
|
|
No. of
|
Aggregate
|
|
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Category
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
|
|
|
|
|
|
|
|
|
Fixed-Maturity Securities:
|
|
|
|
|
|
|
|
|
U.S.
Treasury securities
|
|
|
|
|
|
|
|
|
and
obligations of U.S.
|
|
|
|
|
|
|
|
|
government
corporations
|
|
|
|
|
|
|
|
|
and
agencies
|
$4,943,730
|
$(20,282)
|
3
|
$-
|
$-
|
-
|
$4,943,730
|
$(20,282)
|
|
|
|
|
|
|
|
|
|
Political
subdivisions of
|
|
|
|
|
|
|
|
|
States,
Territories and
|
|
|
|
|
|
|
|
|
Possessions
|
3,716,760
|
(84,282)
|
7
|
-
|
-
|
-
|
3,716,760
|
(84,282)
|
|
|
|
|
|
|
|
|
|
Corporate
and other
|
|
|
|
|
|
|
|
|
bonds
industrial and
|
|
|
|
|
|
|
|
|
miscellaneous
|
67,818,785
|
(1,436,598)
|
83
|
8,059,700
|
(369,216)
|
16
|
75,878,485
|
(1,805,814)
|
|
|
|
|
|
|
|
|
|
Residential
mortgage and other
|
|
|
|
|
|
|
|
|
asset
backed securities
|
8,791,842
|
(104,872)
|
10
|
9,776,165
|
(312,583)
|
15
|
18,568,007
|
(417,455)
|
|
|
|
|
|
|
|
|
|
Total
fixed-maturity
|
|
|
|
|
|
|
|
|
securities
|
$85,271,117
|
$(1,646,034)
|
103
|
$17,835,865
|
$(681,799)
|
31
|
$103,106,982
|
$(2,327,833)
|
|
December 31, 2017
|
|||||||
|
Less than 12 months
|
12 months or more
|
Total
|
|||||
|
|
|
No. of
|
|
|
No. of
|
Aggregate
|
|
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Category
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
|
|
|||||||
Fixed-Maturity Securities:
|
|
|
|
|
|
|
|
|
Political
subdivisions of
|
|
|
|
|
|
|
|
|
States,
Territories and
|
|
|
|
|
|
|
|
|
Possessions
|
$1,549,839
|
$(30,814)
|
4
|
$-
|
$-
|
-
|
$1,549,839
|
$(30,814)
|
|
|
|
|
|
|
|
|
|
Corporate
and other
|
|
|
|
|
|
|
|
|
bonds
industrial and
|
|
|
|
|
|
|
|
|
miscellaneous
|
15,036,462
|
(269,857)
|
20
|
9,113,924
|
(340,516)
|
17
|
24,150,386
|
(610,373)
|
|
|
|
|
|
|
|
|
|
Residential
mortgage and other
|
|
|
|
|
|
|
|
|
asset
backed securities
|
6,956,371
|
(48,482)
|
6
|
7,867,572
|
(189,022)
|
15
|
14,823,943
|
(237,504)
|
|
|
|
|
|
|
|
|
|
Total
fixed-maturity
|
|
|
|
|
|
|
|
|
securities
|
$23,542,672
|
$(349,153)
|
30
|
$16,981,496
|
$(529,538)
|
32
|
$40,524,168
|
$(878,691)
|
|
|
|
|
|
|
|
|
|
Equity Securities:
|
|
|
|
|
|
|
|
|
Preferred
stocks
|
$1,605,217
|
$(20,313)
|
5
|
$1,776,675
|
$(120,712)
|
3
|
$3,381,892
|
$(141,025)
|
Common
stocks and
|
|
|
|
|
|
|
|
|
exchange
traded mutual funds
|
1,446,375
|
(222,205)
|
4
|
124,900
|
(14,530)
|
1
|
1,571,275
|
(236,735)
|
|
|
|
|
|
|
|
|
|
Total
equity securities
|
$3,051,592
|
$(242,518)
|
9
|
$1,901,575
|
$(135,242)
|
4
|
$4,953,167
|
$(377,760)
|
|
|
|
|
|
|
|
|
|
Total
|
$26,594,264
|
$(591,671)
|
39
|
$18,883,071
|
$(664,780)
|
36
|
$45,477,335
|
$(1,256,451)
|
Three Months Ended March 31,
|
2018
|
2017
|
|
|
|
Cash
flows provided by (used in):
|
|
|
Operating
activities
|
$380,373
|
$2,056,143
|
Investing
activities
|
(15,438,163)
|
(20,370,870)
|
Financing
activities
|
(1,729,676)
|
29,505,862
|
Net (decrease) increase in cash and cash
equivalents
|
(16,787,466)
|
11,191,135
|
Cash
and cash equivalents, beginning of period
|
48,381,633
|
12,044,520
|
Cash and cash equivalents, end of period
|
$31,594,167
|
$23,235,655
|
|
Treaty
Year
|
|
|
July 1,
2017
|
July 1,
2016
|
|
to
|
to
|
Line of
Business
|
June 30,
2018
|
June 30,
2017
|
|
|
|
Personal Lines:
|
|
|
Homeowners,
dwelling fire and canine legal liability
|
|
|
Quota share
treaty:
|
|
|
Percent
ceded
|
20%
|
40%
|
Risk
retained
|
$800,000
|
$500,000
|
Losses per
occurrence subject to quota share reinsurance coverage
|
$1,000,000
|
$833,333
|
Excess of
loss coverage and facultative facility above quota share coverage
(1)
|
$9,000,000
|
$3,666,667
|
|
in excess
of
|
in excess
of
|
|
$1,000,000
|
$833,333
|
Total
reinsurance coverage per occurrence
|
$9,200,000
|
$4,000,000
|
Losses per
occurrence subject to reinsurance coverage
|
$10,000,000
|
$4,500,000
|
Expiration
date
|
June
30, 2019
|
June 30,
2017
|
|
|
|
Personal
Umbrella
|
|
|
Quota share
treaty:
|
|
|
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, 2018
|
June 30,
2017
|
|
|
|
Commercial Lines:
|
|
|
General
liability commercial policies
|
|
|
Quota share
treaty:
|
|
|
Percent
ceded
|
None
|
None
|
Risk
retained
|
$750,000
|
$500,000
|
Losses per
occurrence subject to quota share reinsurance coverage
|
None
|
None
|
Excess of
loss coverage above quota share coverage
|
$3,750,000
|
$4,000,000
|
|
in excess
of
|
in excess
of
|
|
$750,000
|
$500,000
|
Total
reinsurance coverage per occurrence
|
$3,750,000
|
$4,000,000
|
Losses per
occurrence subject to reinsurance coverage
|
$4,500,000
|
$4,500,000
|
|
|
|
Commercial
Umbrella
|
|
|
Quota share
treaty:
|
|
|
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, 2018
|
June 30,
2017
|
|
|
|
Catastrophe Reinsurance:
|
|
|
Initial loss
subject to personal lines quota share treaty
|
$5,000,000
|
$5,000,000
|
Risk retained
per catastrophe occurrence (2)
|
$4,000,000
|
$3,000,000
|
Catastrophe
loss coverage in excess of quota share coverage (3)
|
$315,000,000
|
$247,000,000
|
Reinstatement
premium protection (4)
|
Yes
|
Yes
|
|
|
July 1, 2017 -
June 30, 2018
|
|
July 1, 2016 -
June 30, 2017
|
||||
Treaty
|
|
Range of
Loss
|
|
Risk
Retained
|
|
Range of
Loss
|
|
Risk
Retained
|
Personal
Lines (1)
|
|
Initial
$1,000,000
|
|
$800,000
|
|
Initial
$833,333
|
|
$500,000
|
|
|
$1,000,000
- $10,000,000
|
|
None(2)
|
|
$833,333
- $4,500,000
|
|
None(3)
|
|
|
Over
$10,000,000
|
|
100%
|
|
Over
$4,500,000
|
|
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
$500,000
|
|
$500,000
|
|
|
$750,000
- $4,500,000
|
|
None(3)
|
|
$500,000
- $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
|
|
$4,000,000
|
|
Initial
$5,000,000
|
|
$3,000,000
|
|
|
$5,000,000
- $320,000,000
|
None
|
|
$5,000,000
- $252,000,000
|
None
|
||
|
|
Over
$320,000,000
|
|
100%
|
|
Over
$252,000,000
|
|
100%
|
|
March 31,
2018
|
||||
|
Interest
Rate Shift in Basis Points
|
||||
|
|
|
|
|
|
Category
|
-200
|
-100
|
0
|
100
|
200
|
|
|||||
Held-to-Maturity Securities
|
|
|
|
|
|
Fair
value of held-to-maturity securities portfolio
|
$5,101,549
|
$5,081,807
|
$5,062,065
|
$5,042,323
|
$5,022,581
|
Fair
value change
|
39,484
|
19,742
|
|
(19,742)
|
(39,484)
|
Fair
value change from base percentage
|
0.78%
|
0.39%
|
|
-0.39%
|
-0.78%
|
|
|
|
|
|
|
Available-for-Sale Securities
|
|
|
|
|
|
Fair
value of available-for-sale securities portfolio
|
141,237,566
|
135,193,384
|
129,149,201
|
123,105,018
|
117,060,836
|
Fair
value change
|
12,088,365
|
6,044,183
|
|
(6,044,183)
|
(12,088,365)
|
Fair
value change from base percentage
|
9.36%
|
4.68%
|
|
-4.68%
|
-9.36%
|
|
March 31,
2018
|
|||
|
|
|
|
Weighted
|
|
|
|
|
Average
|
|
Fair
Market
|
Carry
|
Unrealized
|
Credit
|
Category
|
Value
|
Value
|
Gain
(Loss)
|
Quality
|
|
|
|||
U.S.
Treasury securities and
|
|
|
|
|
obligations
of U.S. government
|
|
|
|
|
corporations
and agencies
|
$4,943,730
|
$4,964,012
|
$(20,282)
|
AAA
|
|
|
|
|
|
Political
subdivisions of States,
|
|
|
|
|
Territories
and Possessions
|
6,555,925
|
6,591,252
|
(35,327)
|
AA
|
|
|
|
|
|
Corporate
and other bonds
|
|
|
|
|
Industrial
and miscellaneous
|
95,294,416
|
96,910,715
|
(1,616,299)
|
BBB
|
|
|
|
|
|
Residential
mortgage and other asset
|
|
|
|
|
backed
securities (1)
|
22,355,130
|
22,446,778
|
(91,648)
|
A
|
Total
|
$129,149,201
|
$130,912,757
|
$(1,763,556)
|
A
|
|
December 31,
2017
|
|||
|
|
|
|
Weighted
|
|
|
|
|
Average
|
|
Fair
Market
|
Carry
|
Unrealized
|
Credit
|
Category
|
Value
|
Value
|
Gain
(Loss)
|
Quality
|
|
|
|||
U.S.
Treasury securities and
|
|
|
|
|
obligations
of U.S. government
|
|
|
|
|
corporations
and agencies
|
$-
|
$-
|
$-
|
n/a
|
|
|
|
|
|
Political
subdivisions of States,
|
|
|
|
|
Territories
and Possessions
|
11,315,443
|
11,096,122
|
219,321
|
AA
|
|
|
|
|
|
Corporate
and other bonds
|
|
|
|
|
Industrial
and miscellaneous
|
88,141,465
|
87,562,631
|
578,834
|
BBB
|
|
|
|
|
|
Residential
mortgage and other asset
|
|
|
|
|
backed
securities (1)
|
20,531,348
|
20,463,353
|
67,995
|
A
|
Total
|
$119,988,256
|
$119,122,106
|
$866,150
|
A
|
|
March 31,
2018
|
||||||
|
Change
in Equity Values in Percent
|
||||||
|
|
|
|
|
|
|
|
Category
|
(30)%
|
(20)%
|
(10)%
|
0%
|
10%
|
20%
|
30%
|
|
|
|
|||||
Equity Securities:
|
|
|
|
|
|
|
|
Fair
value of preferred stocks
|
4,979,224
|
5,690,542
|
6,401,859
|
7,113,177
|
7,824,495
|
8,535,812
|
9,247,130
|
Fair
value change
|
(2,133,953)
|
(1,422,635)
|
(711,318)
|
|
711,318
|
1,422,635
|
2,133,953
|
|
|
|
|
|
|
|
|
Fair
value of common stocks and
|
|
|
|
|
|
|
|
exchange
traded mutual funds
|
6,641,116
|
7,589,846
|
8,538,577
|
9,487,308
|
10,436,039
|
11,384,770
|
12,333,500
|
Fair
value change
|
(2,846,192)
|
(1,897,462)
|
(948,731)
|
|
948,731
|
1,897,462
|
2,846,192
|
Period
|
Total
Number of Shares
Purchased(1)
|
Average
Price
Paid
per
Share
|
Total Number of
Shares Purchased as Part of Publicly Announced Plans or
Programs
|
Maximum Number of
Shares that May Be Purchased Under the Plans or
Programs
|
|
|
|
|
|
1/1/18 –
1/31/18
|
-
|
-
|
-
|
-
|
2/1/18 –
2/28/18
|
-
|
-
|
-
|
-
|
3/1/18 –
3/31/18
|
60,885
|
$15.51
|
-
|
-
|
Total
|
60,885
|
$15.51
|
-
|
-
|
Restated
Certificate of Incorporation, as amended1
|
|
|
|
By-laws,
as amended2
|
|
|
|
Rule
13a-14(a)/15d-14(a) Certification of Principal Executive Officer as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
|
|
|
Rule
13a-14(a)/15d-14(a) Certification of Principal Financial Officer as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
|
Certification
of Chief Executive Officer and Chief Financial Officer Pursuant to
18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
|
|
|
|
101.INS
|
XBRL
Instance Document
|
|
|
101.SCH
|
101.SCH
XBRL Taxonomy Extension Schema.
|
|
|
101.CAL
|
101.CAL
XBRL Taxonomy Extension Calculation Linkbase.
|
|
|
101.DEF
|
101.DEF
XBRL Taxonomy Extension Definition Linkbase.
|
|
|
101.LAB
|
101.LAB
XBRL Taxonomy Extension Label Linkbase.
|
|
|
101.PRE
|
101.PRE
XBRL Taxonomy Extension Presentation Linkbase.
|
|
KINGSTONE
COMPANIES, INC.
|
|
|
|
|
|
|
Dated:
May 10, 2018
|
By:
|
/s/
Barry B.
Goldstein
|
|
|
|
Barry B.
Goldstein
|
|
|
|
President
|
|
|
|
|
|
|
|
|
|
Dated: May 10,
2018
|
By:
|
/s/
Victor
Brodsky
|
|
|
|
Victor
Brodsky
|
|
|
|
Chief
Financial Officer
|
|