10-Q 1 cnfr-10q_20220930.htm 10-Q cnfr-10q_20220930.htm
0001502292 --12-31 2022 Q3 false 0 P5Y P5Y 0 0 0 0.14 0.12 1.26 0.03 11101194 9692150 10178975 9686874 11101194 9692150 10178975 9686874 0.14 0.12 1.26 0.03 0001502292 2022-01-01 2022-09-30 xbrli:shares 0001502292 2022-11-09 iso4217:USD 0001502292 2022-09-30 0001502292 2021-12-31 iso4217:USD xbrli:shares 0001502292 2022-07-01 2022-09-30 0001502292 2021-07-01 2021-09-30 0001502292 2021-01-01 2021-09-30 0001502292 us-gaap:CommonStockMember 2022-06-30 0001502292 us-gaap:RetainedEarningsMember 2022-06-30 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-06-30 0001502292 2022-06-30 0001502292 us-gaap:RetainedEarningsMember 2022-07-01 2022-09-30 0001502292 us-gaap:CommonStockMember 2022-07-01 2022-09-30 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-07-01 2022-09-30 0001502292 us-gaap:CommonStockMember 2022-09-30 0001502292 us-gaap:RetainedEarningsMember 2022-09-30 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-09-30 0001502292 us-gaap:CommonStockMember 2021-06-30 0001502292 us-gaap:RetainedEarningsMember 2021-06-30 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-06-30 0001502292 2021-06-30 0001502292 us-gaap:RetainedEarningsMember 2021-07-01 2021-09-30 0001502292 us-gaap:CommonStockMember 2021-07-01 2021-09-30 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-07-01 2021-09-30 0001502292 us-gaap:CommonStockMember 2021-09-30 0001502292 us-gaap:RetainedEarningsMember 2021-09-30 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-09-30 0001502292 2021-09-30 0001502292 us-gaap:CommonStockMember 2021-12-31 0001502292 us-gaap:RetainedEarningsMember 2021-12-31 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-12-31 0001502292 us-gaap:RetainedEarningsMember 2022-01-01 2022-09-30 0001502292 us-gaap:CommonStockMember 2022-01-01 2022-09-30 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-01-01 2022-09-30 0001502292 us-gaap:CommonStockMember 2020-12-31 0001502292 us-gaap:RetainedEarningsMember 2020-12-31 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-12-31 0001502292 2020-12-31 0001502292 us-gaap:RetainedEarningsMember 2021-01-01 2021-09-30 0001502292 us-gaap:CommonStockMember 2021-01-01 2021-09-30 0001502292 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-01-01 2021-09-30 xbrli:pure cnfr:class_business cnfr:state 0001502292 us-gaap:USGovernmentAgenciesDebtSecuritiesMember 2022-09-30 0001502292 us-gaap:USStatesAndPoliticalSubdivisionsMember 2022-09-30 0001502292 us-gaap:CorporateDebtSecuritiesMember 2022-09-30 0001502292 cnfr:CommercialMortgageAndAssetBackedMember 2022-09-30 0001502292 us-gaap:ResidentialMortgageBackedSecuritiesMember 2022-09-30 0001502292 us-gaap:CommercialMortgageBackedSecuritiesMember 2022-09-30 0001502292 us-gaap:MortgageBackedSecuritiesMember 2022-09-30 0001502292 us-gaap:USGovernmentAgenciesDebtSecuritiesMember 2021-12-31 0001502292 us-gaap:USStatesAndPoliticalSubdivisionsMember 2021-12-31 0001502292 us-gaap:CorporateDebtSecuritiesMember 2021-12-31 0001502292 cnfr:CommercialMortgageAndAssetBackedMember 2021-12-31 0001502292 us-gaap:ResidentialMortgageBackedSecuritiesMember 2021-12-31 0001502292 us-gaap:CommercialMortgageBackedSecuritiesMember 2021-12-31 0001502292 us-gaap:MortgageBackedSecuritiesMember 2021-12-31 cnfr:security 0001502292 us-gaap:DebtSecuritiesMember 2022-07-01 2022-09-30 0001502292 us-gaap:DebtSecuritiesMember 2021-07-01 2021-09-30 0001502292 us-gaap:DebtSecuritiesMember 2022-01-01 2022-09-30 0001502292 us-gaap:DebtSecuritiesMember 2021-01-01 2021-09-30 0001502292 us-gaap:EquitySecuritiesMember 2022-07-01 2022-09-30 0001502292 us-gaap:EquitySecuritiesMember 2021-07-01 2021-09-30 0001502292 us-gaap:EquitySecuritiesMember 2022-01-01 2022-09-30 0001502292 us-gaap:EquitySecuritiesMember 2021-01-01 2021-09-30 0001502292 us-gaap:CashAndCashEquivalentsMember 2022-07-01 2022-09-30 0001502292 us-gaap:CashAndCashEquivalentsMember 2021-07-01 2021-09-30 0001502292 us-gaap:CashAndCashEquivalentsMember 2022-01-01 2022-09-30 0001502292 us-gaap:CashAndCashEquivalentsMember 2021-01-01 2021-09-30 0001502292 2021-01-01 2021-12-31 0001502292 us-gaap:USGovernmentAgenciesDebtSecuritiesMember us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 us-gaap:USGovernmentAgenciesDebtSecuritiesMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 us-gaap:USGovernmentAgenciesDebtSecuritiesMember us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 us-gaap:USStatesAndPoliticalSubdivisionsMember us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 us-gaap:USStatesAndPoliticalSubdivisionsMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 us-gaap:USStatesAndPoliticalSubdivisionsMember us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 us-gaap:CorporateDebtSecuritiesMember us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 us-gaap:CorporateDebtSecuritiesMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 us-gaap:CorporateDebtSecuritiesMember us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 cnfr:CommercialMortgageAndAssetBackedMember us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 cnfr:CommercialMortgageAndAssetBackedMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 cnfr:CommercialMortgageAndAssetBackedMember us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 us-gaap:ResidentialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 us-gaap:ResidentialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 us-gaap:ResidentialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 us-gaap:CommercialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 us-gaap:CommercialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 us-gaap:CommercialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 us-gaap:MortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 us-gaap:MortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 us-gaap:MortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 srt:PartnershipInterestMember 2022-09-30 0001502292 us-gaap:SeniorNotesMember 2022-09-30 0001502292 us-gaap:SeniorNotesMember us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 us-gaap:SeniorNotesMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 us-gaap:SeniorNotesMember us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 us-gaap:SubordinatedDebtMember 2022-09-30 0001502292 us-gaap:SubordinatedDebtMember us-gaap:FairValueInputsLevel1Member 2022-09-30 0001502292 us-gaap:SubordinatedDebtMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0001502292 us-gaap:SubordinatedDebtMember us-gaap:FairValueInputsLevel3Member 2022-09-30 0001502292 srt:FederalHomeLoanBankOfIndianapolisMember 2022-09-30 0001502292 us-gaap:FairValueInputsLevel1Member srt:FederalHomeLoanBankOfIndianapolisMember 2022-09-30 0001502292 us-gaap:FairValueInputsLevel2Member srt:FederalHomeLoanBankOfIndianapolisMember 2022-09-30 0001502292 us-gaap:FairValueInputsLevel3Member srt:FederalHomeLoanBankOfIndianapolisMember 2022-09-30 0001502292 us-gaap:USGovernmentAgenciesDebtSecuritiesMember us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 us-gaap:USGovernmentAgenciesDebtSecuritiesMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 us-gaap:USGovernmentAgenciesDebtSecuritiesMember us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 us-gaap:USStatesAndPoliticalSubdivisionsMember us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 us-gaap:USStatesAndPoliticalSubdivisionsMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 us-gaap:USStatesAndPoliticalSubdivisionsMember us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 us-gaap:CorporateDebtSecuritiesMember us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 us-gaap:CorporateDebtSecuritiesMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 us-gaap:CorporateDebtSecuritiesMember us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 cnfr:CommercialMortgageAndAssetBackedMember us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 cnfr:CommercialMortgageAndAssetBackedMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 cnfr:CommercialMortgageAndAssetBackedMember us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 us-gaap:ResidentialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 us-gaap:ResidentialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 us-gaap:ResidentialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 us-gaap:CommercialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 us-gaap:CommercialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 us-gaap:CommercialMortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 us-gaap:MortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 us-gaap:MortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 us-gaap:MortgageBackedSecuritiesMember us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 srt:PartnershipInterestMember 2021-12-31 0001502292 us-gaap:SeniorNotesMember 2021-12-31 0001502292 us-gaap:SeniorNotesMember us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 us-gaap:SeniorNotesMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 us-gaap:SeniorNotesMember us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 us-gaap:SubordinatedDebtMember 2021-12-31 0001502292 us-gaap:SubordinatedDebtMember us-gaap:FairValueInputsLevel1Member 2021-12-31 0001502292 us-gaap:SubordinatedDebtMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0001502292 us-gaap:SubordinatedDebtMember us-gaap:FairValueInputsLevel3Member 2021-12-31 0001502292 us-gaap:FairValueMeasurementsNonrecurringMember 2022-09-30 0001502292 us-gaap:FairValueMeasurementsNonrecurringMember 2021-12-31 0001502292 us-gaap:ShortDurationInsuranceContractAccidentYear2019Member 2022-07-01 2022-09-30 0001502292 us-gaap:ShortDurationInsuranceContractAccidentYear2021Member 2022-07-01 2022-09-30 0001502292 us-gaap:ShortDurationInsuranceContractAccidentYear2020Member 2022-07-01 2022-09-30 0001502292 cnfr:CommercialLines1Member 2022-07-01 2022-09-30 0001502292 cnfr:PersonalLines1Member 2022-07-01 2022-09-30 0001502292 us-gaap:ShortDurationInsuranceContractAccidentYear2019Member 2022-01-01 2022-09-30 0001502292 us-gaap:ShortDurationInsuranceContractAccidentYear2020Member 2022-01-01 2022-09-30 0001502292 us-gaap:ShortDurationInsuranceContractAccidentYear2021Member 2022-01-01 2022-09-30 0001502292 cnfr:CommercialLines1Member 2022-01-01 2022-09-30 0001502292 cnfr:PersonalLines1Member 2022-01-01 2022-09-30 0001502292 us-gaap:ShortDurationInsuranceContractsAccidentYear2017Member 2021-07-01 2021-09-30 0001502292 us-gaap:ShortDurationInsuranceContractsAccidentYear2018Member 2021-07-01 2021-09-30 0001502292 us-gaap:ShortDurationInsuranceContractAccidentYear2019Member 2021-07-01 2021-09-30 0001502292 cnfr:CommercialLines1Member 2021-07-01 2021-09-30 0001502292 cnfr:PersonalLines1Member 2021-07-01 2021-09-30 0001502292 cnfr:WinterStormUriMember 2021-07-01 2021-09-30 0001502292 us-gaap:ShortDurationInsuranceContractsAccidentYear2017Member 2021-01-01 2021-09-30 0001502292 us-gaap:ShortDurationInsuranceContractsAccidentYear2018Member 2021-01-01 2021-09-30 0001502292 us-gaap:ShortDurationInsuranceContractAccidentYear2019Member 2021-01-01 2021-09-30 0001502292 us-gaap:ShortDurationInsuranceContractAccidentYear2020Member 2021-01-01 2021-09-30 0001502292 cnfr:CommercialLines1Member 2021-01-01 2021-09-30 0001502292 cnfr:PersonalLines1Member 2021-01-01 2021-09-30 0001502292 cnfr:HundredPercentageCedeOfCommercialLiabilityRisksInExcessOfFourHundredThousandDollarMember 2022-01-01 2022-09-30 0001502292 cnfr:HundredPercentageCedeOfCommercialLiabilityRisksInExcessOfFourHundredThousandDollarMember 2021-01-01 2021-12-31 0001502292 cnfr:CededCommercialPropertyRisksInExcessOfThreeHundredThousandDollarMember 2022-01-01 2022-09-30 0001502292 cnfr:CededCommercialPropertyRisksInExcessOfTwoHundredThousandDollarMember 2021-01-01 2021-12-31 0001502292 cnfr:CededHomeownersSpecificRisksInExcessOfThreeHundredThousandDollarMember 2022-01-01 2022-09-30 0001502292 cnfr:CededHomeownersSpecificRisksInExcessOfThreeHundredThousandDollarMember 2021-01-01 2021-12-31 0001502292 cnfr:CedingCommissionMember 2021-12-30 2021-12-31 0001502292 us-gaap:AcquisitionRelatedCostsMember cnfr:CedingCommissionMember 2021-12-30 2021-12-31 0001502292 us-gaap:AcquisitionRelatedCostsMember cnfr:CedingCommissionMember 2022-01-01 2022-09-30 0001502292 us-gaap:AcquisitionRelatedCostsMember cnfr:CedingCommissionMember 2022-07-01 2022-09-30 cnfr:debt_instrument 0001502292 us-gaap:SeniorNotesMember cnfr:SeniorUnsecuredNotesEffectiveSeptember2018Member 2022-09-30 0001502292 us-gaap:LineOfCreditMember 2022-09-30 0001502292 us-gaap:SubordinatedDebtMember cnfr:PrivatePlacementSubordinatedNoteMember 2022-09-30 0001502292 cnfr:FederalHomeLoanBankDebtMember 2022-09-30 0001502292 us-gaap:SeniorNotesMember 2022-09-30 0001502292 us-gaap:SeniorNotesMember 2021-12-31 0001502292 us-gaap:SubordinatedDebtMember 2022-09-30 0001502292 us-gaap:SubordinatedDebtMember 2021-12-31 0001502292 cnfr:SeniorUnsecuredNotesEffectiveSeptember2018Member us-gaap:SeniorNotesMember 2018-10-31 0001502292 us-gaap:SeniorNotesMember cnfr:SeniorUnsecuredNotesEffectiveSeptember2018Member 2022-07-01 2022-09-30 0001502292 us-gaap:SeniorNotesMember cnfr:SeniorUnsecuredNotesEffectiveSeptember2018Member 2022-01-01 2022-09-30 0001502292 us-gaap:SeniorNotesMember cnfr:SeniorUnsecuredNotesEffectiveSeptember2018Member 2021-07-01 2021-09-30 0001502292 us-gaap:SeniorNotesMember cnfr:SeniorUnsecuredNotesEffectiveSeptember2018Member 2021-01-01 2021-09-30 0001502292 us-gaap:SubordinatedDebtMember cnfr:PrivatePlacementSubordinatedNoteMember 2018-09-24 0001502292 us-gaap:SubordinatedDebtMember cnfr:PrivatePlacementSubordinatedNoteMember us-gaap:DebtInstrumentRedemptionPeriodOneMember 2018-09-24 0001502292 us-gaap:SubordinatedDebtMember cnfr:PrivatePlacementSubordinatedNoteMember us-gaap:DebtInstrumentRedemptionPeriodTwoMember 2018-09-24 0001502292 us-gaap:SubordinatedDebtMember cnfr:PrivatePlacementSubordinatedNoteMember 2022-01-01 2022-09-30 0001502292 us-gaap:SubordinatedDebtMember cnfr:PrivatePlacementSubordinatedNoteMember us-gaap:DebtInstrumentRedemptionPeriodOneMember 2018-09-24 2018-09-24 0001502292 us-gaap:SubordinatedDebtMember cnfr:PrivatePlacementSubordinatedNoteMember us-gaap:DebtInstrumentRedemptionPeriodTwoMember 2018-09-24 2018-09-24 0001502292 us-gaap:SubordinatedDebtMember cnfr:PrivatePlacementSubordinatedNoteMember us-gaap:DebtInstrumentRedemptionPeriodThreeMember 2018-09-24 2018-09-24 0001502292 us-gaap:CommonStockMember 2022-08-10 2022-08-10 0001502292 us-gaap:LineOfCreditMember 2022-12-01 0001502292 us-gaap:LineOfCreditMember us-gaap:LondonInterbankOfferedRateLIBORMember 2022-12-01 2022-12-01 0001502292 srt:FederalHomeLoanBankOfIndianapolisMember 2022-07-07 0001502292 srt:FederalHomeLoanBankOfIndianapolisMember 2022-07-07 2022-07-07 0001502292 cnfr:PaycheckProtectionProgramMember 2020-04-24 0001502292 cnfr:PaycheckProtectionProgramMember 2020-04-24 2020-04-24 0001502292 cnfr:PaycheckProtectionProgramMember us-gaap:OtherNonoperatingIncomeExpenseMember 2021-07-01 2021-09-30 0001502292 us-gaap:CommonStockMember us-gaap:PrivatePlacementMember 2022-08-10 2022-08-10 0001502292 us-gaap:CommonStockMember us-gaap:PrivatePlacementMember 2022-08-10 0001502292 us-gaap:RestrictedStockUnitsRSUMember 2022-01-01 2022-09-30 0001502292 us-gaap:RestrictedStockUnitsRSUMember 2021-01-01 2021-09-30 0001502292 us-gaap:RestrictedStockUnitsRSUMember 2021-07-01 2021-09-30 0001502292 us-gaap:RestrictedStockUnitsRSUMember 2022-07-01 2022-09-30 cnfr:vote 0001502292 us-gaap:EmployeeStockOptionMember 2020-01-01 2020-06-30 0001502292 us-gaap:EmployeeStockOptionMember 2022-03-08 2022-03-08 0001502292 cnfr:OmnibusIncentivePlanMember us-gaap:RestrictedStockUnitsRSUMember 2016-01-01 2016-12-31 0001502292 cnfr:OmnibusIncentivePlanMember us-gaap:RestrictedStockUnitsRSUMember 2018-01-01 2018-12-31 0001502292 cnfr:OmnibusIncentivePlanMember us-gaap:RestrictedStockUnitsRSUMember 2022-01-01 2022-09-30 0001502292 cnfr:OmnibusIncentivePlanMember us-gaap:RestrictedStockUnitsRSUMember 2021-01-01 2021-09-30 0001502292 cnfr:OmnibusIncentivePlanMember us-gaap:RestrictedStockUnitsRSUMember 2022-09-30 0001502292 us-gaap:EmployeeStockOptionMember 2022-01-01 2022-09-30 0001502292 us-gaap:EmployeeStockOptionMember 2021-01-01 2021-09-30 0001502292 us-gaap:EmployeeStockOptionMember 2022-09-30 cnfr:business 0001502292 cnfr:MichiganFloridaTexasAndPennsylvaniaMember us-gaap:GeographicConcentrationRiskMember cnfr:GrossWrittenPremiumsMember 2022-01-01 2022-09-30 0001502292 cnfr:MichiganFloridaTexasAndPennsylvaniaMember us-gaap:GeographicConcentrationRiskMember cnfr:GrossWrittenPremiumsMember 2021-01-01 2021-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:CommercialLines1Member 2022-07-01 2022-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:PersonalLines1Member 2022-07-01 2022-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:CommercialAndPersonalLinesMember 2022-07-01 2022-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:InsuranceAgencyMember 2022-07-01 2022-09-30 0001502292 us-gaap:CorporateNonSegmentMember 2022-07-01 2022-09-30 0001502292 us-gaap:IntersegmentEliminationMember 2022-07-01 2022-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:CommercialLines1Member 2021-07-01 2021-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:PersonalLines1Member 2021-07-01 2021-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:CommercialAndPersonalLinesMember 2021-07-01 2021-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:InsuranceAgencyMember 2021-07-01 2021-09-30 0001502292 us-gaap:CorporateNonSegmentMember 2021-07-01 2021-09-30 0001502292 us-gaap:IntersegmentEliminationMember 2021-07-01 2021-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:CommercialLines1Member 2022-01-01 2022-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:PersonalLines1Member 2022-01-01 2022-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:CommercialAndPersonalLinesMember 2022-01-01 2022-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:InsuranceAgencyMember 2022-01-01 2022-09-30 0001502292 us-gaap:CorporateNonSegmentMember 2022-01-01 2022-09-30 0001502292 us-gaap:IntersegmentEliminationMember 2022-01-01 2022-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:CommercialLines1Member 2021-01-01 2021-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:PersonalLines1Member 2021-01-01 2021-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:CommercialAndPersonalLinesMember 2021-01-01 2021-09-30 0001502292 us-gaap:OperatingSegmentsMember cnfr:InsuranceAgencyMember 2021-01-01 2021-09-30 0001502292 us-gaap:CorporateNonSegmentMember 2021-01-01 2021-09-30 0001502292 us-gaap:IntersegmentEliminationMember 2021-01-01 2021-09-30 0001502292 us-gaap:SubsequentEventMember cnfr:VentureAgencyHoldingsIncMember 2022-10-13 0001502292 us-gaap:SubsequentEventMember cnfr:VentureAgencyHoldingsIncMember 2022-10-13 2022-10-13 0001502292 cnfr:AssetPurchaseAgreementMember us-gaap:SubsequentEventMember cnfr:WhitetailInsuranceServicesLLCMember 2022-10-14 2022-10-14 0001502292 cnfr:AssetPurchaseAgreementMember srt:ScenarioForecastMember cnfr:WhitetailInsuranceServicesLLCMember 2022-10-01 2022-12-31 0001502292 cnfr:LossPortfolioTransferReinsuranceAgreementMember cnfr:FlemingReinsuranceLtdMember us-gaap:ShortDurationInsuranceContractAccidentYear2019Member 2022-06-30 0001502292 cnfr:LossPortfolioTransferReinsuranceAgreementMember us-gaap:SubsequentEventMember cnfr:FlemingReinsuranceLtdMember 2022-11-01 2022-11-01 0001502292 cnfr:LossPortfolioTransferReinsuranceAgreementMember us-gaap:SubsequentEventMember srt:MinimumMember cnfr:FlemingReinsuranceLtdMember 2022-11-01 0001502292 cnfr:LossPortfolioTransferReinsuranceAgreementMember us-gaap:SubsequentEventMember srt:MaximumMember cnfr:FlemingReinsuranceLtdMember 2022-11-01 0001502292 cnfr:LossPortfolioTransferReinsuranceAgreementMember us-gaap:SubsequentEventMember cnfr:FlemingReinsuranceLtdMember us-gaap:ShortDurationInsuranceContractAccidentYear2019Member 2022-11-01 2022-11-01 0001502292 cnfr:LossPortfolioTransferReinsuranceAgreementMember cnfr:FlemingReinsuranceLtdMember 2022-06-30

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended September 30, 2022

OR

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from           to          

Commission file number 001-37536

 

Conifer Holdings, Inc.

(Exact name of registrant as specified in its charter)

 

Michigan

 

27-1298795

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

3001 West Big Beaver Road, Suite 200

 

 

Troy, Michigan

 

48084

(Address of principal executive offices)

 

(Zip code)

 

(248) 559-0840

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock, no par value

 

CNFR

 

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐

Accelerated filer ☐

Non-accelerated filer ☐

Smaller reporting company ☑

Emerging growth company ☐

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ☐ No ☑

The number of outstanding shares of the registrant’s common stock, no par value, as of November 9, 2022, was 12,216,324.

 

 

 

 

 

 

CONIFER HOLDINGS, INC. AND SUBSIDIARIES

Form 10-Q

INDEX

 

 

Page No.

Part I — Financial Information

 

Item 1 — Financial Statements

3

Consolidated Balance Sheets (Unaudited)

3

Consolidated Statements of Operations (Unaudited)

4

Consolidated Statements of Comprehensive Income (Loss) (Unaudited)

5

Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)

6

Consolidated Statements of Cash Flows (Unaudited)

7

Notes to Consolidated Financial Statements (Unaudited)

8

Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations

26

Item 3 — Quantitative and Qualitative Disclosures about Market Risk

39

Item 4 — Controls and Procedures

40

Part II — Other Information

 

Item 1 — Legal Proceedings

41

Item 1A — Risk Factors

41

Item 2 — Unregistered Sales of Equity Securities and Use of Proceeds

41

Item 6 — Exhibits

42

Signatures

43

 

 

 

2

 

 

PART 1 - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

CONIFER HOLDINGS, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

(dollars in thousands)

 

 

 

September 30,

2022

 

 

December 31,

2021

 

 

 

(Unaudited)

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

Investment securities:

 

 

 

 

 

 

 

 

Debt securities, at fair value (amortized cost of $129,372 and $150,732, respectively)

 

$

111,847

 

 

$

149,783

 

Equity securities, at fair value (cost of $1,906 and $10,972, respectively)

 

 

1,312

 

 

 

9,931

 

Short-term investments, at fair value

 

 

30,562

 

 

 

23,013

 

Total investments

 

 

143,721

 

 

 

182,727

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

35,413

 

 

 

9,913

 

Premiums and agents' balances receivable, net

 

 

21,856

 

 

 

21,197

 

Receivable from Affiliate

 

 

5,862

 

 

 

5,784

 

Reinsurance recoverables on unpaid losses

 

 

41,749

 

 

 

40,344

 

Reinsurance recoverables on paid losses

 

 

2,489

 

 

 

1,347

 

Prepaid reinsurance premiums

 

 

15,333

 

 

 

8,301

 

Deferred policy acquisition costs

 

 

10,483

 

 

 

12,267

 

Other assets

 

 

9,096

 

 

 

8,524

 

Total assets

 

$

286,002

 

 

$

290,404

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

Unpaid losses and loss adjustment expenses

 

$

144,557

 

 

$

139,085

 

Unearned premiums

 

 

67,792

 

 

 

65,269

 

Reinsurance premiums payable

 

 

3,352

 

 

 

5,318

 

Debt

 

 

48,298

 

 

 

33,564

 

Accounts payable and accrued expenses

 

 

5,838

 

 

 

6,665

 

Total liabilities

 

 

269,837

 

 

 

249,901

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

 

 

Common stock, no par value (100,000,000 shares authorized; 12,215,324 and

9,707,817 issued and outstanding, respectively)

 

 

97,857

 

 

 

92,692

 

Accumulated deficit

 

 

(62,871

)

 

 

(50,079

)

Accumulated other comprehensive income (loss)

 

 

(18,821

)

 

 

(2,110

)

Total shareholders' equity

 

 

16,165

 

 

 

40,503

 

Total liabilities and shareholders' equity

 

$

286,002

 

 

$

290,404

 

 

The accompanying notes are an integral part of the Consolidated Financial Statements.

3

 

CONIFER HOLDINGS, INC. AND SUBSIDIARIES

Consolidated Statements of Operations (Unaudited)

(dollars in thousands, except per share data)

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenue and Other Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Premiums

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross earned premiums

 

$

34,401

 

 

 

31,770

 

 

$

100,947

 

 

$

90,245

 

Ceded earned premiums

 

 

(9,443

)

 

 

(6,829

)

 

 

(27,458

)

 

 

(17,631

)

Net earned premiums

 

 

24,958

 

 

 

24,941

 

 

 

73,489

 

 

 

72,614

 

Net investment income

 

 

860

 

 

 

514

 

 

 

1,931

 

 

 

1,549

 

Net realized investment gains (losses)

 

 

—

 

 

 

(101

)

 

 

(1,505

)

 

 

3,883

 

Change in fair value of equity securities

 

 

(151

)

 

 

(2,169

)

 

 

446

 

 

 

(3,234

)

Other gains (losses)

 

 

66

 

 

 

2,778

 

 

 

60

 

 

 

11,688

 

Other income

 

 

603

 

 

 

752

 

 

 

1,964

 

 

 

1,974

 

Total revenue and other income

 

 

26,336

 

 

 

26,715

 

 

 

76,385

 

 

 

88,474

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Losses and loss adjustment expenses, net

 

 

16,671

 

 

 

16,159

 

 

 

56,940

 

 

 

53,447

 

Policy acquisition costs

 

 

6,230

 

 

 

7,173

 

 

 

17,419

 

 

 

20,819

 

Operating expenses

 

 

4,380

 

 

 

4,077

 

 

 

13,010

 

 

 

12,768

 

Interest expense

 

 

778

 

 

 

701

 

 

 

2,216

 

 

 

2,154

 

Total expenses

 

 

28,059

 

 

 

28,110

 

 

 

89,585

 

 

 

89,188

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before equity earnings in Affiliate and income taxes

 

 

(1,723

)

 

 

(1,395

)

 

 

(13,200

)

 

 

(714

)

Equity earnings in Affiliate, net of tax

 

 

199

 

 

 

184

 

 

 

368

 

 

 

612

 

Income tax expense (benefit)

 

 

(1

)

 

 

(2

)

 

 

(40

)

 

 

191

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

(1,523

)

 

$

(1,209

)

 

$

(12,792

)

 

$

(293

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) per common share, basic and diluted

 

$

(0.14

)

 

$

(0.12

)

 

$

(1.26

)

 

$

(0.03

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding, basic and diluted

 

 

11,101,194

 

 

 

9,692,150

 

 

 

10,178,975

 

 

 

9,686,874

 

 

The accompanying notes are an integral part of the Consolidated Financial Statements.

4

 

CONIFER HOLDINGS, INC. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income (Loss) (Unaudited)

(dollars in thousands)

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended September 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net income (loss)

 

$

(1,523

)

 

$

(1,209

)

 

$

(12,792

)

 

$

(293

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income (loss), net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized investment gains (losses):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized investment gains (losses) during the period

 

 

(4,347

)

 

 

(570

)

 

 

(16,641

)

 

 

(2,100

)

Income tax (benefit) expense

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Unrealized investment gains (losses), net of tax

 

 

(4,347

)

 

 

(570

)

 

 

(16,641

)

 

 

(2,100

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: reclassification adjustments to:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net realized investment gains (losses) included in net income (loss)

 

 

—

 

 

 

44

 

 

 

70

 

 

 

85

 

Income tax (benefit) expense

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total reclassifications included in net income (loss), net of tax

 

 

—

 

 

 

44

 

 

 

70

 

 

 

85

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income (loss)

 

 

(4,347

)

 

 

(614

)

 

 

(16,711

)

 

 

(2,185

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total comprehensive income (loss)

 

$

(5,870

)

 

$

(1,823

)

 

$

(29,503

)

 

$

(2,478

)

 

The accompanying notes are an integral part of the Consolidated Financial Statements.

5

 

CONIFER HOLDINGS, INC. AND SUBSIDIARIES

Consolidated Statements of Changes in Shareholders' Equity (Unaudited)

(dollars in thousands)

 

 

 

No Par, Common Stock

 

 

Accumulated

 

 

Accumulated

Other

Comprehensive

 

 

Total

Shareholders'

 

 

 

Shares

 

 

Amount

 

 

Deficit

 

 

Income (Loss)

 

 

Equity

 

Balances at June 30, 2022

 

 

9,715,324

 

 

$

92,799

 

 

$

(61,348

)

 

$

(14,474

)

 

$

16,977

 

Net income (loss)

 

 

—

 

 

 

—

 

 

 

(1,523

)

 

 

—

 

 

 

(1,523

)

Repurchase of common stock

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Issuance of common stock private placement

 

 

2,500,000

 

 

 

5,000

 

 

 

—

 

 

 

—

 

 

 

5,000

 

Stock-based compensation expense

 

 

—

 

 

 

58

 

 

 

—

 

 

 

—

 

 

 

58

 

Other comprehensive income (loss)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(4,347

)

 

 

(4,347

)

Balances at September 30, 2022

 

 

12,215,324

 

 

$

97,857

 

 

$

(62,871

)

 

$

(18,821

)

 

$

16,165

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances at June 30, 2021

 

 

9,689,421

 

 

$

92,612

 

 

$

(48,069

)

 

$

(659

)

 

$

43,884

 

Net income (loss)

 

 

—

 

 

 

—

 

 

 

(1,209

)

 

 

—

 

 

 

(1,209

)

Repurchase of common stock

 

 

(1,240

)

 

 

(4

)

 

 

—

 

 

 

—

 

 

 

(4

)

Stock-based compensation expense

 

 

17,975

 

 

 

51

 

 

 

—

 

 

 

—

 

 

 

51

 

Other comprehensive income (loss)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(614

)

 

 

(614

)

Balances at September 30, 2021

 

 

9,706,156

 

 

$

92,659

 

 

$

(49,278

)

 

$

(1,273

)

 

$

42,108

 

 

 

 

No Par, Common Stock

 

 

Accumulated

 

 

Accumulated

Other

Comprehensive

 

 

Total

Shareholders'

 

 

 

Shares

 

 

Amount

 

 

Deficit

 

 

Income (Loss)

 

 

Equity

 

Balances at December 31, 2021

 

 

9,707,817

 

 

$

92,692

 

 

$

(50,079

)

 

$

(2,110

)

 

$

40,503

 

Net income (loss)

 

 

—

 

 

 

—

 

 

 

(12,792

)

 

 

—

 

 

 

(12,792

)

Repurchase of common stock

 

 

(1,493

)

 

 

11

 

 

 

—

 

 

 

—

 

 

 

11

 

Issuance of common stock private placement

 

 

2,500,000

 

 

 

5,000

 

 

 

—

 

 

 

—

 

 

 

5,000

 

Stock-based compensation expense

 

 

9,000

 

 

 

154

 

 

 

—

 

 

 

—

 

 

 

154

 

Other comprehensive income (loss)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(16,711

)

 

 

(16,711

)

Balances at September 30, 2022

 

 

12,215,324

 

 

$

97,857

 

 

$

(62,871

)

 

$

(18,821

)

 

$

16,165

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances at December 31, 2020

 

 

9,681,728

 

 

$

92,486

 

 

$

(48,985

)

 

$

912

 

 

$

44,413

 

Net income (loss)

 

 

—

 

 

 

—

 

 

 

(293

)

 

 

—

 

 

 

(293

)

Repurchase of common stock

 

 

(3,547

)

 

 

(11

)

 

 

—

 

 

 

—

 

 

 

(11

)

Stock-based compensation expense

 

 

27,975

 

 

 

184

 

 

 

—

 

 

 

—

 

 

 

184

 

Other comprehensive income (loss)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2,185

)

 

 

(2,185

)

Balances at September 30, 2021

 

 

9,706,156

 

 

$

92,659

 

 

$

(49,278

)

 

$

(1,273

)

 

$

42,108

 

 

The accompanying notes are an integral part of the Consolidated Financial Statements.

 

6

 

 

CONIFER HOLDINGS, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows (Unaudited)

(dollars in thousands)

 

 

 

Nine Months Ended September 30,

 

 

 

2022

 

 

2021

 

Cash Flows From Operating Activities

 

 

 

 

 

 

 

 

Net income (loss)

 

$

(12,792

)

 

$

(293

)

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: