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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 June 30, 2024
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: 001-33245
EMPLOYERS HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
| | | | | | | | |
| Nevada | | 04-3850065 |
(State or other jurisdiction
of incorporation or organization) | | (I.R.S. Employer
Identification Number) |
| 2340 Corporate Circle, Suite 200 |
| Henderson, | Nevada | 89074 |
| (Address of principal executive offices and zip code) |
(888) 682-6671
(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, $0.01 par value per share | | EIG | | New York Stock Exchange |
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, a smaller reporting company, or an emerging growth company. See 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 ☑
As of July 30, 2024, there were 24,836,585 shares of the registrant's common stock outstanding.
PART I – FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
| | | | | | | | | | | | | | |
| Employers Holdings, Inc. and Subsidiaries |
| Consolidated Balance Sheets |
| (in millions, except share data) |
| | As of | | As of |
| | June 30,
2024 | | December 31,
2023 |
| Assets | | (unaudited) | | |
| Investments: | | | | |
Fixed maturity securities at fair value (amortized cost $2,136.6 at June 30, 2024 and $2,048.0 at December 31, 2023, less CECL allowance of $1.9 at June 30, 2024 and $2.7 at December 31, 2023) | | $ | 2,009.4 | | | $ | 1,936.3 | |
Equity securities at fair value (cost $134.4 at June 30, 2024 and $125.9 at December 31, 2023) | | 232.6 | | | 211.2 | |
Equity securities at cost | | 5.7 | | | 6.0 | |
Other invested assets (cost $86.5 at June 30, 2024 and $82.5 at December 31, 2023) | | 97.5 | | | 91.5 | |
Short-term investments at fair value (amortized cost $30.9 at June 30, 2024 and $33.1 at December 31, 2023) | | 30.9 | | | 33.1 | |
| Total investments | | 2,376.1 | | | 2,278.1 | |
| Cash and cash equivalents | | 95.5 | | | 226.4 | |
| Restricted cash and cash equivalents | | 0.2 | | | 0.2 | |
| Accrued investment income | | 16.7 | | | 16.3 | |
Premiums receivable (less CECL allowance of $18.8 at June 30, 2024 and $17.9 at December 31, 2023) | | 399.8 | | | 359.4 | |
| Reinsurance recoverable for: | | | | |
| Paid losses | | 6.3 | | | 6.3 | |
Unpaid losses (less CECL allowance of $0.9 at June 30, 2024 and $0.9 at December 31, 2023) | | 417.4 | | | 427.5 | |
| | | | |
| Deferred policy acquisition costs | | 62.3 | | | 55.6 | |
| | | | |
| Deferred income tax asset, net | | 42.1 | | | 43.4 | |
| Property and equipment, net | | 6.7 | | | 6.5 | |
| Operating lease right-of-use assets | | 4.4 | | | 5.1 | |
| Intangible assets, net | | 13.6 | | | 13.6 | |
| Goodwill | | 36.2 | | | 36.2 | |
| Contingent commission receivable—LPT Agreement | | 14.6 | | | 14.2 | |
| | | | |
| Cloud computing arrangements | | 21.2 | | | 28.0 | |
| Other assets | | 36.9 | | | 33.6 | |
| Total assets | | $ | 3,550.0 | | | $ | 3,550.4 | |
| Liabilities and stockholders’ equity | | | | |
| Claims and policy liabilities: | | | | |
| Unpaid losses and loss adjustment expenses | | $ | 1,850.9 | | | $ | 1,884.5 | |
| Unearned premiums | | 419.4 | | | 379.7 | |
| | | | |
| | | | |
| Commissions and premium taxes payable | | 65.2 | | | 66.0 | |
| Accounts payable and accrued expenses | | 18.7 | | | 26.1 | |
| | | | |
| | | | |
| Deferred reinsurance gain—LPT Agreement | | 95.3 | | | 99.2 | |
| | | | |
| | | | |
| Operating lease liability | | 5.1 | | | 5.9 | |
| Non-cancellable obligations | | 12.1 | | | 17.0 | |
| Other liabilities | | 60.4 | | | 58.1 | |
| Total liabilities | | $ | 2,527.1 | | | $ | 2,536.5 | |
| Commitments and contingencies | | | | |
| | | | | | | | | | | | | | |
| Employers Holdings, Inc. and Subsidiaries |
| Consolidated Balance Sheets |
| (in millions, except share data) |
| | As of | | As of |
| | June 30,
2024 | | December 31,
2023 |
| Stockholders’ equity: | | (unaudited) | | |
Common stock, $0.01 par value; 150,000,000 shares authorized; 58,167,193 and 58,055,968 shares issued and 24,896,116 and 25,369,753 shares outstanding at June 30, 2024 and December 31, 2023, respectively | | $ | 0.6 | | | $ | 0.6 | |
| Preferred stock, $0.01 par value; 25,000,000 shares authorized; none issued | | — | | | — | |
| Additional paid-in capital | | 420.9 | | | 419.8 | |
| Retained earnings | | 1,429.4 | | | 1,384.3 | |
| Accumulated other comprehensive loss, net of tax | | (99.0) | | | (86.0) | |
Treasury stock, at cost (33,271,077 shares at June 30, 2024 and 32,686,215 shares at December 31, 2023) | | (729.0) | | | (704.8) | |
| Total stockholders’ equity | | 1,022.9 | | | 1,013.9 | |
| Total liabilities and stockholders’ equity | | $ | 3,550.0 | | | $ | 3,550.4 | |
See accompanying unaudited notes to the consolidated financial statements.
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Employers Holdings, Inc. and Subsidiaries |
| Consolidated Statements of Comprehensive Income (Loss) |
| (in millions, except per share data) |
| | Three Months Ended | | Six Months Ended |
| | | June 30, | | June 30, |
| | | 2024 | | 2023 | | 2024 | | 2023 |
| Revenues | | (unaudited) | | (unaudited) |
| Net premiums earned | | $ | 187.8 | | | $ | 177.1 | | | $ | 372.6 | | | $ | 349.8 | |
| Net investment income | | 26.9 | | | 26.8 | | | 53.8 | | | 54.4 | |
Net realized and unrealized gains on investments | | 2.2 | | | 11.3 | | | 13.6 | | | 17.7 | |
| | | | | | | | |
| Other income (loss) | | 0.1 | | | — | | | 0.1 | | | (0.2) | |
| Total revenues | | 217.0 | | | 215.2 | | | 440.1 | | | 421.7 | |
| Expenses | | | | | | | | |
| Losses and loss adjustment expenses | | 108.8 | | | 90.5 | | | 225.3 | | | 197.9 | |
| Commission expense | | 26.8 | | | 23.6 | | | 52.3 | | | 47.1 | |
| | | | | | | | |
| Underwriting and general and administrative expenses | | 41.4 | | | 46.0 | | | 87.2 | | | 90.3 | |
| Interest and financing expenses | | — | | | 1.9 | | | — | | | 4.2 | |
| Other expenses | | — | | | 9.4 | | | — | | | 9.4 | |
| Total expenses | | 177.0 | | | 171.4 | | | 364.8 | | | 348.9 | |
| Net Income before income taxes | | 40.0 | | | 43.8 | | | 75.3 | | | 72.8 | |
Income tax expense | | 8.3 | | | 8.9 | | | 15.3 | | | 14.3 | |
| Net Income | | $ | 31.7 | | | $ | 34.9 | | | $ | 60.0 | | | $ | 58.5 | |
| | | | | | | | |
Comprehensive income | | | | | | | | |
Unrealized AFS investment (losses) gains arising during the period, net of tax benefit (expense) of $1.4 and $4.1 for the three months ended June 30, 2024 and 2023, respectively, and $4.4 and $(1.9) for the six months ended June 30, 2024 and 2023, respectively | | $ | (4.9) | | | $ | (15.5) | | | $ | (16.5) | | | $ | 7.1 | |
Reclassification adjustment for realized AFS investment losses in net income, net of tax benefit of $(0.7) for the three months ended June 30, 2024, and $(0.9) and $(0.4) for the six months ended June 30, 2024 and 2023, respectively | | 2.8 | | | 0.1 | | | 3.5 | | | 1.3 | |
Other comprehensive (loss) income, net of tax | | (2.1) | | | (15.4) | | | (13.0) | | | 8.4 | |
Total Comprehensive income | | $ | 29.6 | | | $ | 19.5 | | | $ | 47.0 | | | $ | 66.9 | |
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| | | | | | | | |
| | | | | | | | |
| Earnings per common share (Note 13): | | | | | | | | |
| | | | | | | | |
| Basic | | $ | 1.25 | | | $ | 1.31 | | | $ | 2.37 | | | $ | 2.17 | |
| Diluted | | $ | 1.25 | | | $ | 1.30 | | | $ | 2.36 | | | $ | 2.16 | |
| Cash dividends declared per common share and eligible plan awards | | $ | 0.30 | | | $ | 0.28 | | | $ | 0.58 | | | $ | 0.54 | |
See accompanying unaudited notes to the consolidated financial statements.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Employers Holdings, Inc. and Subsidiaries |
| Consolidated Statements of Stockholders’ Equity |
For the Three Months Ended June 30, 2024 and 2023 |
| (Unaudited) |
| | | | | | | | | | | |
| Common Stock | | Additional Paid-In Capital | | Retained Earnings | | Accumulated Other Comprehensive Loss, Net | | Treasury Stock at Cost | | Total Stockholders’ Equity |
| Shares Issued | | Amount | | | | | |
| (in millions, except share data) |
| Balance, April 1, 2024 | 58,152,792 | | | $ | 0.6 | | | $ | 419.5 | | | $ | 1,405.4 | | | $ | (96.9) | | | $ | (709.7) | | | $ | 1,018.9 | |
| Stock-based obligations | — | | | — | | | 1.4 | | | — | | | — | | | — | | | 1.4 | |
| | | | | | | | | | | | | |
| Vesting of RSUs and PSUs, net of shares withheld to satisfy tax withholdings | 14,401 | | | — | | | — | | | — | | | — | | | — | | | — | |
Acquisition of common stock(1) | — | | | — | | | — | | | — | | | — | | | (19.3) | | | (19.3) | |
| Dividends declared | — | | | — | | | — | | | (7.7) | | | — | | | — | | | (7.7) | |
| Net income for the period | — | | | — | | | — | | | 31.7 | | | — | | | — | | | 31.7 | |
| | | | | | | | | | | | | |
Change in net unrealized losses on AFS investments, net of taxes of $0.7 | — | | | — | | | — | | | — | | | (2.1) | | | — | | | (2.1) | |
| Balance, June 30, 2024 | 58,167,193 | | | $ | 0.6 | | | $ | 420.9 | | | $ | 1,429.4 | | | $ | (99.0) | | | $ | (729.0) | | | $ | 1,022.9 | |
| | | | | | | | | | | | | |
| Balance, April 1, 2023 | 57,985,389 | | | $ | 0.6 | | | $ | 415.6 | | | $ | 1,312.1 | | | $ | (115.1) | | | $ | (639.1) | | | $ | 974.1 | |
| Stock-based obligations | — | | | — | | | 1.5 | | | — | | | — | | | — | | | 1.5 | |
| | | | | | | | | | | | | |
| Vesting of RSUs and PSUs, net of shares withheld to satisfy tax withholdings | 12,096 | | | — | | | — | | | — | | | — | | | — | | | — | |
Acquisition of common stock(1) | — | | | — | | | — | | | — | | | — | | | (35.8) | | | (35.8) | |
| Dividends declared | — | | | — | | | — | | | (7.6) | | | — | | | — | | | (7.6) | |
Net income for the period | — | | | — | | | — | | | 34.9 | | | — | | | — | | | 34.9 | |
| | | | | | | | | | | | | |
Change in net unrealized losses on AFS investments, net of taxes of $4.1 | — | | | — | | | — | | | — | | | (15.4) | | | — | | | (15.4) | |
| Balance, June 30, 2023 | 57,997,485 | | | $ | 0.6 | | | $ | 417.1 | | | $ | 1,339.4 | | | $ | (130.5) | | | $ | (674.9) | | | $ | 951.7 | |
(1) Amount includes applicable excise tax as imposed by the Inflation Reduction Act of 2022 (See Note 7). |
| See accompanying unaudited notes to the consolidated financial statements. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Employers Holdings, Inc. and Subsidiaries |
| Consolidated Statements of Stockholders’ Equity |
For the Six Months Ended June 30, 2024 and 2023 |
| (Unaudited) |
| | | | | | | | | | | |
| Common Stock | | Additional Paid-In Capital | | Retained Earnings | | Accumulated Other Comprehensive Loss, Net | | Treasury Stock at Cost | | Total Stockholders’ Equity |
| Shares Issued | | Amount | | | | | |
| (in millions, except share data) |
| Balance, January 1, 2024 | 58,055,968 | | | $ | 0.6 | | | $ | 419.8 | | | $ | 1,384.3 | | | $ | (86.0) | | | $ | (704.8) | | | $ | 1,013.9 | |
| Stock-based obligations | — | | | — | | | 2.8 | | | — | | | — | | | — | | | 2.8 | |
| | | | | | | | | | | | | |
| Vesting of RSUs and PSUs, net of shares withheld to satisfy tax withholdings | 111,225 | | | — | | | (1.7) | | | — | | | — | | | — | | | (1.7) | |
Acquisition of common stock(1) | — | | | — | | | — | | | — | | | — | | | (24.2) | | | (24.2) | |
| Dividends declared | — | | | — | | | — | | | (14.9) | | | — | | | — | | | (14.9) | |
| Net income for the period | — | | | — | | | — | | | 60.0 | | | — | | | — | | | 60.0 | |
| | | | | | | | | | | | | |
Change in net unrealized losses on AFS investments, net of taxes of $3.5 | — | | | — | | | — | | | — | | | (13.0) | | | — | | | (13.0) | |
| Balance, June 30, 2024 | 58,167,193 | | | $ | 0.6 | | | $ | 420.9 | | | $ | 1,429.4 | | | $ | (99.0) | | | $ | (729.0) | | | $ | 1,022.9 | |
| | | | | | | | | | | | | |
| Balance, January 1, 2023 | 57,876,287 | | | $ | 0.6 | | | $ | 414.6 | | | $ | 1,295.6 | | | $ | (138.9) | | | $ | (627.7) | | | $ | 944.2 | |
| Stock-based obligations | — | | | — | | | 3.2 | | | — | | | — | | | — | | | 3.2 | |
| Stock options exercised | 23,500 | | | — | | | 0.7 | | | — | | | — | | | — | | | 0.7 | |
| Vesting of RSUs and PSUs, net of shares withheld to satisfy tax withholdings | 97,698 | | | — | | | (1.4) | | | — | | | — | | | — | | | (1.4) | |
Acquisition of common stock(1) | — | | | — | | | — | | | — | | | — | | | (47.2) | | | (47.2) | |
| Dividends declared | — | | | — | | | — | | | (14.7) | | | — | | | — | | | (14.7) | |
| Net income for the period | — | | | — | | | — | | | 58.5 | | | — | | | — | | | 58.5 | |
| | | | | | | | | | | | | |
Change in net unrealized losses on AFS investments, net of taxes of $(2.3) | — | | | — | | | — | | | — | | | 8.4 | | | — | | | 8.4 | |
| Balance, June 30, 2023 | 57,997,485 | | | $ | 0.6 | | | $ | 417.1 | | | $ | 1,339.4 | | | $ | (130.5) | | | $ | (674.9) | | | $ | 951.7 | |
(1) Amount includes applicable excise tax as imposed by the Inflation Reduction Act of 2022 (See Note 7). |
| See accompanying unaudited notes to the consolidated financial statements. |
| | | | | | | | | | | | | | |
| Employers Holdings, Inc. and Subsidiaries |
| Consolidated Statements of Cash Flows |
| (in millions) |
| | | Six Months Ended |
| | | June 30, |
| | | 2024 | | 2023 |
| Operating activities | | (unaudited) |
| Net income | | $ | 60.0 | | | $ | 58.5 | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | |
| Depreciation and amortization | | 1.9 | | | 2.7 | |
| Stock-based compensation | | 2.8 | | | 3.2 | |
| Amortization of cloud computing arrangements | | 7.3 | | | 8.4 | |
Amortization of discounts and premiums on investments, net | | (0.7) | | | 1.8 | |
| Allowance for expected credit losses | | 0.9 | | | 2.4 | |
Deferred income tax (benefit) expense | | 4.8 | | | 4.9 | |
Net realized and unrealized gains on investments | | (13.6) | | | (17.7) | |
| | | | |
| | | | |
| Asset impairment and related charges | | — | | | 2.6 | |
| Noncash operating lease term adjustment | | — | | | (1.0) | |
| Change in operating assets and liabilities: | | | | |
| | | | |
| Premiums receivable | | (41.3) | | | (48.8) | |
| Reinsurance recoverable on paid and unpaid losses | | 10.1 | | | 9.2 | |
| | | | |
| Cloud computing arrangements | | (0.4) | | | (2.2) | |
| Operating lease right-of-use assets | | 0.7 | | | 6.9 | |
| Current federal income taxes | | (4.6) | | | (11.9) | |
| Unpaid losses and loss adjustment expenses | | (33.6) | | | (33.5) | |
| Unearned premiums | | 39.7 | | | 39.0 | |
| Accounts payable, accrued expenses and other liabilities | | (2.4) | | | (5.6) | |
| Deferred reinsurance gain—LPT Agreement | | (3.9) | | | (4.0) | |
| Contingent commission receivable—LPT Agreement | | (0.4) | | | — | |
| Operating lease liabilities | | (0.8) | | | (7.2) | |
| Non-cancellable obligations | | (4.9) | | | (5.7) | |
| Other | | (9.3) | | | (5.5) | |
Net cash provided by (used in) operating activities | | 12.3 | | | (3.5) | |
| Investing activities | | | | |
| Purchases of fixed maturity securities | | (274.7) | | | (157.8) | |
| Purchases of equity securities | | (22.0) | | | (22.6) | |
| Purchases of short-term investments | | (17.7) | | | (24.5) | |
| Purchases of other invested assets | | (4.1) | | | (20.6) | |
| Proceeds from sale of fixed maturity securities | | 84.7 | | | 125.5 | |
| Proceeds from sale of equity securities | | 17.1 | | | 32.5 | |
| Proceeds from maturities and redemptions of fixed maturity securities | | 96.5 | | | 63.8 | |
| Proceeds from maturities of short-term investments | | 20.2 | | | 127.3 | |
| Net change in unsettled investment purchases and sales | | 0.7 | | | (3.6) | |
| Capital expenditures and other | | (2.3) | | | (0.6) | |
| | | | |
| | | | |
Net cash (used in) provided by investing activities | | (101.6) | | | 119.4 | |
| Financing activities | | | | |
| | | | |
| Acquisition of common stock | | (24.4) | | | (46.1) | |
| Cash transactions related to stock-based compensation | | (1.7) | | | (0.7) | |
| Dividends paid to stockholders | | (15.4) | | | (15.2) | |
| | | | |
| Repayments on FHLB advances | | — | | | (76.8) | |
| | | | |
| | | | |
| Payments on finance leases | | (0.1) | | | (0.1) | |
| | | | |
Net cash used in financing activities | | (41.6) | | | (138.9) | |
Net decrease in cash, cash equivalents and restricted cash | | (130.9) | | | (23.0) | |
| Cash, cash equivalents and restricted cash at the beginning of the period | | 226.6 | | | 89.4 | |
| Cash, cash equivalents and restricted cash at the end of the period | | $ | 95.7 | | | $ | 66.4 | |
| | | | |
| | | | |
| | | | |
The following table presents our cash, cash equivalents and restricted cash by category within the Consolidated Balance Sheets:
| | | | | | | | | | | | | | |
| | As of | | As of |
| | June 30,
2024 | | December 31,
2023 |
| | (unaudited) | | |
| | (in millions) |
| Cash and cash equivalents | | $ | 95.5 | | | $ | 226.4 | |
| Restricted cash and cash equivalents supporting reinsurance obligations | | 0.2 | | | 0.2 | |
| Total cash, cash equivalents and restricted cash | | $ | 95.7 | | | $ | 226.6 | |
See accompanying unaudited notes to the consolidated financial statements.
Employers Holdings, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)
1. Basis of Presentation and Summary of Operations
Employers Holdings, Inc. (EHI) is a Nevada holding company. Through its wholly owned insurance subsidiaries, Employers Insurance Company of Nevada (EICN), Employers Compensation Insurance Company (ECIC), Employers Preferred Insurance Company (EPIC), Employers Assurance Company (EAC), and Cerity Insurance Company (CIC), EHI is engaged in the commercial property and casualty insurance industry, specializing in workers’ compensation products and services. Unless otherwise indicated, all references to the “Company” refer to EHI, together with its subsidiaries.
In 1999, the Nevada State Industrial Insurance System (the Fund) entered into a retroactive 100% quota share reinsurance agreement (the LPT Agreement) through a loss portfolio transfer transaction with third party reinsurers. The LPT Agreement, which ceded to the reinsurers substantially all of the Fund's outstanding losses as of June 30, 1999 for claims with original dates of injury prior to July 1, 1995, provides coverage for losses up to $2.0 billion, excluding losses for burial and transportation expenses. The LPT Agreement will remain in effect until: (i) all claims under the covered policies have closed; (ii) the LPT Agreement is commuted or terminated, upon the mutual agreement of the parties; or (iii) the reinsurers’ aggregate maximum limit of liability is exhausted, whichever occurs first. The LPT Agreement does not provide for any additional termination terms. On January 1, 2000, EICN assumed all of the assets, liabilities and operations of the Fund, including the Fund’s rights and obligations associated with the LPT Agreement (See Note 9).
The Company accounts for the LPT Agreement as retroactive reinsurance. Upon entry into the LPT Agreement, an initial deferred reinsurance gain (the Deferred Gain) was recorded as a liability on the Company’s Consolidated Balance Sheets. The Company is also entitled to receive a contingent profit commission under the LPT Agreement through June 30, 2024. The contingent profit commission is estimated based on both actual paid results to date and projections of expected paid losses under the LPT Agreement and is recorded as an asset on the Company’s Consolidated Balance Sheets. The Contingent Commission receivable at June 30, 2024 was $14.6 million.
The accompanying consolidated financial statements have been prepared in accordance with United States (U.S.) generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934 (Exchange Act), as amended. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal, recurring adjustments) necessary for a fair presentation of the Company’s consolidated financial position and results of operations for the periods presented have been included. The results of operations for an interim period are not necessarily indicative of the results for an entire year. These financial statements have been prepared consistent with the accounting policies described in the Company’s Form 10-K for the year ended December 31, 2023 (Annual Report).
The Company operates as a single operating segment, Insurance Operations, through its wholly owned subsidiaries. The Company considers an operating segment to be any component of its business whose operating results are regularly reviewed by the Company's chief operating decision maker (CODM) to make decisions about resources to be allocated to the segment and assess its performance based on discrete financial information. Prior to December 31, 2023, the Company operated through two reportable segments: Employers and Cerity. All periods prior to December 31, 2023 have been conformed to the current presentation. Detailed financial information about the Company's single operating segment is presented in Note 14.
Use of Estimates
The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. As a result, actual results could differ from these estimates. The most significant areas that require management judgment are the estimate of unpaid losses and loss adjustment expenses (LAE), evaluation of reinsurance recoverables, recognition of premium revenue, recoverability of deferred income taxes, and valuation of investments.
2. New Accounting Standards
Recently Issued Accounting Standards
In November 2023, the Financial Accounting Standards Board (FASB) issued ASU 2023-07, Segment Reporting (Topic 280). The amendments in this update improve disclosures about reportable segments and provide more detailed information about a reportable segment's expenses. Specifically, the amendments in this update require that a public entity disclose, on an annual and interim basis: (i) significant segment expenses that are regularly provided to the CODM; (ii) an amount for other segment items by reportable segment and a description on their composition; (iii) all annual disclosures about a reportable segment's profit or loss and assets currently required by Topic 280 in interim periods; (iv) the measures the CODM uses in assessing performance and allocating resources; and (v) the title and position of the CODM. Public entities that have a single reporting segment are also required to provide all the disclosures required by this amendment, along with all existing segment disclosures in Topic 280. This update is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company will adopt this standard when it becomes effective.
Recently Adopted Accounting Standards
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740). This update requires public business entities to annually disclose specific categories within the income tax rate reconciliation, and provide additional information for reconciling items that meet a certain quantitative threshold. Additionally, the amendments in this update require entities to disclose certain information about income taxes paid, income tax disaggregation, disclosures around unrecognized tax benefits, and the removal of disclosures related to temporary differences surrounding deferred tax liabilities to enhance the transparency and decision usefulness of income tax disclosures. This update is effective for fiscal years beginning after December 15, 2024 and early adoption is permitted for financial statements that have not been issued. The Company early adopted this update as of December 31, 2023, and the impact of this standard was not material to its consolidated financial condition or its results of operations.
In March 2020, the FASB issued Accounting Standards Update (ASU) 2020-04, Reference Rate Reform (Topic 848). This update provided optional transition guidance to ease the potential accounting burden associated with transitioning away from the London Interbank Offered Rate (LIBOR), with optional expedients and exceptions related to the application of US GAAP to contracts, hedging relationships and other transactions affected by reference rate reform. Companies can elect to adopt this ASU through December 31, 2024. The Company has determined that there was no impact of LIBOR transitioning on its existing contracts and investments.
3. Valuation of Financial Instruments
Financial Instruments Carried at Fair Value
The carrying value and the estimated fair value of the Company’s financial instruments at fair value were as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | June 30, 2024 | | December 31, 2023 |
| | | Carrying Value | | Estimated Fair Value | | Carrying Value | | Estimated Fair Value |
| | | (in millions) |
| Financial assets | | | | | | | | |
| Total investments at fair value | | $ | 2,272.9 | | | $ | 2,272.9 | | | $ | 2,180.6 | | | $ | 2,180.6 | |
| Cash and cash equivalents | | 95.5 | | | 95.5 | | | 226.4 | | | 226.4 | |
| Restricted cash and cash equivalents | | 0.2 | | | 0.2 | | | 0.2 | | | 0.2 | |
| | | | | | | | |
| | | | | | | | |
Assets and liabilities recorded at fair value on the Company’s Consolidated Balance Sheets are categorized based upon the levels of judgment associated with the inputs used to measure their fair value. Level inputs are defined as follows:
•Level 1 - Inputs are unadjusted quoted market prices for identical assets or liabilities in active markets at the measurement date.
•Level 2 - Inputs other than Level 1 prices that are observable for similar assets or liabilities through corroboration with market data at the measurement date.
•Level 3 - Inputs that are unobservable that reflect management’s best estimate of what willing market participants would use in pricing the assets or liabilities at the measurement date.
The Company uses third party pricing services to assist with its investment accounting function. The ultimate pricing source varies depending on the investment security and pricing service used, but investment securities valued on the basis of observable inputs (Levels 1 and 2) are generally assigned values on the basis of actual transactions. Securities valued on the
basis of pricing models with significant unobservable inputs or non-binding broker quotes are classified as Level 3. The Company performs quarterly analyses on the prices it receives from third parties to determine whether the prices are reasonable estimates of fair value, including confirming the fair values of these securities through observable market prices using an alternative pricing source, as it is ultimately management’s responsibility to ensure that the fair values reflected in the Company’s consolidated financial statements are appropriate. If differences are noted in these analyses, the Company may obtain additional information from other pricing services to validate the quoted price.
The Company bases all of its estimates of fair value for assets on bid prices, when available, as they represent what a third-party market participant would be willing to pay in an arm’s length transaction.
For securities not actively traded, third party pricing services may use quoted market prices of similar instruments or discounted cash flow analyses, incorporating inputs that are currently observable in the markets for similar securities. Inputs that are often used in the valuation methodologies include, but are not limited to, broker quotes, benchmark yields, credit spreads, default rates, and prepayment speed assumptions. There were no material adjustments to the valuation methodology utilized by third party pricing services as of June 30, 2024 and December 31, 2023.
These methods of valuation only produce an estimate of fair value if there is objectively verifiable information to produce a valuation. If objectively verifiable information is not available, the Company would be required to produce an estimate of fair value using some of the same methodologies, making assumptions for market-based inputs that are unavailable.
As of June 30, 2024, the Company held $59.3 million of fixed maturity securities at fair value that were designated Level 3. These private placement securities were designated as Level 3 securities due to the limited amount of observable market information available.
The following table presents the Company’s investments at fair value and the corresponding fair value measurements.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | June 30, 2024 | | December 31, 2023 |
| | Level 1 | | Level 2 | | Level 3 | | Level 1 | | Level 2 | | Level 3 |
| | (in millions) |
| Fixed maturity securities: | | | | | | | | | | | | |
| U.S. Treasuries | | $ | — | | | $ | 67.6 | | | $ | — | | | $ | — | | | $ | 58.4 | | | $ | — | |
| U.S. Agencies | | — | | | 2.2 | | | — | | | — | | | 2.1 | | | — | |
| States and municipalities | | — | | | 185.0 | | | — | | | — | | | 210.2 | | | — | |
| Corporate securities | | — | | | 896.4 | | | 45.3 | | | — | | | 863.7 | | | 32.1 | |
Residential mortgage-backed securities | | — | | | 379.3 | | | — | | | — | | | 362.2 | | | — | |
Commercial mortgage-backed securities | | — | | | 64.4 | | | — | | | — | | | 63.8 | | | — | |
| Asset-backed securities | | — | | | 163.2 | | | 14.0 | | | — | | | 113.9 | | | 14.1 | |
| Collateralized loan obligations | | — | | | 63.5 | | | — | | | — | | | 91.5 | | | — | |
| Foreign government securities | | — | | | 9.8 | | | — | | | — | | | 10.4 | | | — | |
Other securities | | — | | | 118.7 | | | — | | | — | | | 113.9 | | | — | |
| Total fixed maturity securities | | $ | — | | | $ | 1,950.1 | | | $ | 59.3 | | | $ | — | | | $ | 1,890.1 | | | $ | 46.2 | |
| Equity securities at fair value: | | | | | | | | | | | | |
| Industrial and miscellaneous | | $ | 202.5 | | | $ | — | | | $ | — | | | $ | 181.7 | | | $ | — | | | $ | — | |
| | | | | | | | | | | | |
| Other | | 30.1 | | | — | | | — | | | 29.5 | | | — | | | — | |
| Total equity securities at fair value | | $ | 232.6 | | | $ | — | | | $ | — | | | $ | 211.2 | | | $ | — | | | $ | — | |
| Short-term investments | | $ | 9.1 | | | $ | 21.8 | | | $ | — | | | $ | 17.6 | | | $ | 15.5 | | | $ | — | |
| Total investments at fair value | | $ | 241.7 | | | $ | 1,971.9 | | | $ | 59.3 | | | $ | 228.8 | | | $ | 1,905.6 | | | $ | 46.2 | |
Financial Instruments Carried at Cost
All of the Company's insurance subsidiaries are members of the Federal Home Loan Bank of San Francisco (FHLB). Members are required to purchase stock in the FHLB in addition to maintaining collateral deposits that back any funds advanced and standby letters of credit issued (See Note 10). The Company’s investment in FHLB stock is recorded at cost, which approximates fair value, as purchases and sales of these securities are at par value with the issuer. FHLB stock is considered a restricted security and is periodically evaluated by the Company for impairment based on the estimated ultimate recovery of par value.
Financial Instruments Carried at Net Asset Value
The Company has investments in private equity limited partnership interests that are included in Other invested assets on the Company’s Consolidated Balance Sheets. These investments do not have readily determinable fair values and are carried at net asset value (NAV) and therefore are excluded from the fair value hierarchy. The Company initially estimates the value of these investments using the transaction price. In subsequent periods, the Company measures these investments using NAV per share provided quarterly by the general partner, based on financial statements that are audited annually. These investments are generally not redeemable by the investees and cannot be sold without approval of the general partner. These investments have a fund term of 3 to 12 years, subject to two or three one-year extensions at the general partner’s discretion. The Company will receive distributions of proceeds from dividends and interest from fund investments, as well as from the disposition of a fund investment, or a portion thereof. The Company expects these distributions from time-to-time during the full course of the fund term. As of June 30, 2024, the Company had unfunded commitments to these private equity limited partnerships totaling $18.3 million.
Additionally, certain cash equivalents, principally money market securities, are measured using NAV, which approximates fair value.
The following table presents cash and investments carried at NAV on the Company’s Consolidated Balance Sheets.
| | | | | | | | | | | |
| June 30, 2024 | | December 31, 2023 |
| (in millions) |
| Cash equivalents carried at NAV | $ | 89.3 | | | $ | 197.2 | |
| Other invested assets carried at NAV | 97.5 | | | 91.5 | |
The following table provides a reconciliation of the beginning and ending balances that are measured using Level 3 inputs.
| | | | | | | | | | | |
| Six Months Ended |
| June 30, |
| 2024 | | 2023 |
| (in millions) |
Balance at the beginning of the year | $ | 46.2 | | | $ | 24.2 | |
| Purchases | 13.6 | | | 1.0 | |
Unrealized (losses) gains included in comprehensive income or loss | (0.5) | | | 0.2 | |
Balance at end of period | $ | 59.3 | | | $ | 25.4 | |
4. Investments
The amortized cost, gross unrealized gains, gross unrealized losses, and estimated fair value of the Company’s available-for-sale (AFS) investments were as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Amortized
Cost | | Allowance for Current Expected Credit Losses | | Gross
Unrealized
Gains | | Gross
Unrealized
Losses | | Estimated
Fair Value |
| | (in millions) |
| At June 30, 2024 | | | | | | | | | | |
| Fixed maturity securities | | | | | | | | | | |
| U.S. Treasuries | | $ | 70.4 | | | $ | — | | | $ | 0.2 | | | $ | (3.0) | | | $ | 67.6 | |
| U.S. Agencies | | 2.3 | | | — | | | — | | | (0.1) | | | 2.2 | |
| States and municipalities | | 189.2 | | | — | | | 1.6 | | | (5.8) | | | 185.0 | |
| Corporate securities | | 1,004.1 | | | (0.7) | | | 4.0 | | | (65.7) | | | 941.7 | |
| Residential mortgage-backed securities | | 424.3 | | | — | | | 0.4 | | | (45.4) | | | 379.3 | |
| Commercial mortgage-backed securities | | 70.4 | | | (0.4) | | | — | | | (5.6) | | | 64.4 | |
| Asset-backed securities | | 180.7 | | | (0.2) | | | 0.9 | | | (4.2) | | | 177.2 | |
| Collateralized loan obligations | | 63.6 | | | — | | | — | | | (0.1) | | | 63.5 | |
| Foreign government securities | | 12.7 | | | — | | | — | | | (2.9) | | | 9.8 | |
Other securities(1) | | 118.9 | | | (0.6) | | | 0.8 | | | (0.4) | | | 118.7 | |
| Total fixed maturity securities | | $ | 2,136.6 | | | $ | (1.9) | | | $ | 7.9 | | | $ | (133.2) | | | $ | 2,009.4 | |
| Short-term investments | | 30.9 | | | — | | | — | | | — | | | 30.9 | |
| Total AFS investments | | $ | 2,167.5 | | | $ | (1.9) | | | $ | 7.9 | | | $ | (133.2) | | | $ | 2,040.3 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| At December 31, 2023 | | | | | | | | | | |
| Fixed maturity securities | | | | | | | | | | |
| U.S. Treasuries | | $ | 60.3 | | | $ | — | | | $ | 0.6 | | | $ | (2.5) | | | $ | 58.4 | |
| U.S. Agencies | | 2.2 | | | — | | | — | | | (0.1) | | | 2.1 | |
| States and municipalities | | 212.3 | | | — | | | 3.1 | | | (5.2) | | | 210.2 | |
| Corporate securities | | 952.8 | | | (2.1) | | | 8.3 | | | (63.2) | | | 895.8 | |
| Residential mortgage-backed securities | | 399.3 | | | — | | | 0.9 | | | (38.0) | | | 362.2 | |
| Commercial mortgage-backed securities | | 70.2 | | | — | | | — | | | (6.4) | | | 63.8 | |
| Asset-backed securities | | 131.8 | | | — | | | 1.0 | | | (4.8) | | | 128.0 | |
| Collateralized loan obligations | | 92.2 | | | — | | | — | | | (0.7) | | | 91.5 | |
| Foreign government securities | | 12.7 | | | — | | | — | | | (2.3) | | | 10.4 | |
Other securities(1) | | 114.2 | | | (0.6) | | | 1.0 | | | (0.7) | | | 113.9 | |
| Total fixed maturity securities | | $ | 2,048.0 | | | $ | (2.7) | | | $ | 14.9 | | | $ | (123.9) | | | $ | 1,936.3 | |
| Short-term investments | | 33.1 | | | — | | | — | | | — | | | 33.1 | |
| Total AFS investments | | $ | 2,081.1 | | | $ | (2.7) | | | $ | 14.9 | | | $ | (123.9) | | | $ | 1,969.4 | |
(1)Other securities within fixed maturity securities consist of bank loans, which are classified as AFS and reported at fair value.
The cost and estimated fair value of the Company’s equity securities recorded at fair value at June 30, 2024 and December 31, 2023 were as follows:
| | | | | | | | | | | | | | |
| | Cost | | Estimated Fair Value |
| | (in millions) |
| At June 30, 2024 | | | | |
| Equity securities at fair value | | | | |
| Industrial and miscellaneous | | $ | 111.5 | | | $ | 202.5 | |
| Other | | 22.9 | | | 30.1 | |
| Total equity securities at fair value | | $ | 134.4 | | | $ | 232.6 | |
| | | | | | | | | | | | | | |
| | | | |
| | |
| At December 31, 2023 | | | | |
| Equity securities at fair value | | | | |
| Industrial and miscellaneous | | $ | 104.4 | | | $ | 181.7 | |
| Other | | 21.5 | | | 29.5 | |
| Total equity securities at fair value | | $ | 125.9 | | | $ | 211.2 | |
The Company had Other invested assets totaling $97.5 million and $91.5 million (initial cost of $86.5 million and $82.5 million) at June 30, 2024 and December 31, 2023, respectively, consisting of private equity limited partnerships, which are carried at NAV based on information provided by the general partner. These investments are non-redeemable until conversion and are periodically evaluated by the Company for impairment based on the ultimate recovery of the investment. Changes in the value of these investments are recorded through Net realized and unrealized gains or losses on the Company’s Consolidated Statements of Comprehensive Income (Loss).
The amortized cost and estimated fair value of the Company’s fixed maturity securities at June 30, 2024, by contractual maturity, are shown below. Expected maturities differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
| | | | | | | | | | | | | | |
| | Amortized Cost | | Estimated Fair Value |
| | (in millions) |
| Due in one year or less | | $ | 46.3 | | | $ | 45.6 | |
| Due after one year through five years | | 644.6 | | | 622.5 | |
| Due after five years through ten years | | 613.0 | | | 571.7 | |
| Due after ten years | | 93.7 | | | 85.2 | |
| Mortgage and asset-backed securities | | 739.0 | | | 684.4 | |
| Total | | $ | 2,136.6 | | | $ | 2,009.4 | |
The following is a summary of AFS investments that have been in a continuous unrealized loss position for less than 12 months and those that have been in a continuous unrealized loss position for 12 months or greater in each case as of June 30, 2024 and December 31, 2023.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | June 30, 2024 | | December 31, 2023 |
| | Estimated Fair Value | | Gross
Unrealized
Losses | | Number of Issues | | Estimated Fair Value | | Gross
Unrealized
Losses | | Number of Issues |
| | (dollars in millions) |
| Less than 12 months: | | | | | | | | | | | | |
| Fixed maturity securities | | | | | | | | | | | | |
| U.S. Treasuries | | $ | 20.1 | | | $ | (0.1) | | | 7 | | | $ | 11.9 | | | $ | (0.1) | | | 5 | |
| | | | | | | | | | | | |
| States and municipalities | | 33.0 | | | (0.5) | | | 13 | | | 39.5 | | | (0.3) | | | 15 | |
| Corporate securities | | 134.6 | | | (1.4) | | | 36 | | | 26.1 | | | (0.8) | | | 13 | |
Residential mortgage-backed securities | | 42.4 | | | (0.3) | | | 25 | | | 15.8 | | | (0.2) | | | 15 | |
| | | | | | | | | | | | |
| Asset-backed securities | | 66.3 | | | (0.4) | | | 22 | | | 24.0 | | | (0.1) | | | 15 | |
| Collateralized loan obligations | | — | | | — | | | — | | | — | | | — | | | — | |
| | | | | | | | | | | | |
Other securities | | 23.3 | | | (0.3) | | | 117 | | | 12.6 | | | (0.1) | | | 70 | |
| Total fixed maturity securities | | 319.7 | | | (3.0) | | | 220 | | | 129.9 | | | (1.6) | | | 133 | |
| | | | | | | | | | | | |
| Total less than 12 months | | $ | 319.7 | | | $ | (3.0) | | | 220 | | | $ | 129.9 | | | $ | (1.6) | | | 133 | |
| | | | | | | | | | | | |
| 12 months or greater: | | | | | | | | | | | | |
| Fixed maturity securities | | | | | | | | | | | | |
| U.S. Treasuries | | $ | 34.8 | | | $ | (2.9) | | | 11 | | | $ | 23.7 | | | $ | (2.4) | | | 7 | |
U.S. Agencies | | 2.2 | | | (0.1) | | | 1 | | | 2.2 | | | (0.1) | | | 1 | |
| States and municipalities | | 83.6 | | | (5.3) | | | 36 | | | 73.5 | | | (4.9) | | | 32 | |
| Corporate securities | | 666.7 | | | (64.3) | | | 282 | | | 684.5 | | | (62.4) | | | 331 | |
Residential mortgage-backed securities | | 293.6 | | | (45.1) | | | 234 | | | 306.6 | | | (37.8) | | | 228 | |
Commercial mortgage-backed securities | | 52.5 | | | (5.6) | | | 23 | | | 53.0 | | | (6.4) | | | 24 | |
| Asset-backed securities | | 48.6 | | | (3.8) | | | 36 | | | 47.0 | | | (4.7) | | | 29 | |
| Collateralized loan obligations | | 5.4 | | | (0.1) | | | 3 | | | 80.5 | | | (0.7) | | | 21 | |
| Foreign government securities | | 9.8 | | | (2.9) | | | 2 | | | 10.4 | | | (2.3) | | | 2 | |
| Other securities | | 3.0 | | | (0.1) | | | 22 | | | 10.2 | | | (0.6) | | | 58 | |
| Total fixed maturity securities | | 1,200.2 | | | (130.2) | | | 650 | | | 1,291.6 | | | (122.3) | | | 733 | |
| Total 12 months or greater | | $ | 1,200.2 | | | $ | (130.2) | | | 650 | | | $ | 1,291.6 | | | $ | (122.3) | | | 733 | |
As of June 30, 2024 and December 31, 2023, the Company had an allowance for current expected credit losses (CECL) on AFS investments of $1.9 million and $2.7 million, respectively (See Note 5). Those fixed maturity securities whose total fair value was less than amortized cost at each of June 30, 2024 and December 31, 2023, were those in which the Company had no intent, need or requirement to sell at an amount less than their amortized cost.
Realized gains and losses on investments include the gain or loss on a security at the time of sale compared to its original or adjusted cost (equity securities and other invested assets) or amortized cost (fixed maturity securities). Realized losses on fixed maturity securities are also recognized when securities are written down as a result of an other-than-temporary impairment or for unfavorable changes in CECL. Reversals of previously recognized realized losses on fixed maturity securities can also result when securities are written up for favorable changes in CECL.
Net realized gains and losses on investments and the change in unrealized gains and losses on the Company’s investments recorded at fair value are determined on a specific-identification basis and were as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Gross Realized Gains | | Gross Realized Losses | | Net Decrease in CECL Allowance | | Change in Net Unrealized Gains (Losses) | | Changes in Fair Value Reflected in Earnings | | Changes in Fair Value Reflected in AOCI (1), before tax |
| | (in millions) |
| Three Months Ended June 30, 2024 | | | | | | | | | | | | |
| Fixed maturity securities | | $ | 0.2 | | | $ | (5.0) | | | $ | 1.3 | | | $ | (2.7) | | | $ | (3.5) | | | $ | (2.7) | |
| Equity securities | | 4.1 | | | (0.4) | | | — | | | (0.3) | | | 3.4 | | | — | |
| Other invested assets | | — | | | — | | | — | | | 2.3 | | | 2.3 | | | — | |
| | | | | | | | | | | | |
| Total investments | | $ | 4.3 | | | $ | (5.4) | | | $ | 1.3 | | | $ | (0.7) | | | $ | 2.2 | | | $ | (2.7) | |
| | | | | | | | | | | | |
| Six Months Ended June 30, 2024 | | | | | | | | | | | | |
| Fixed maturity securities | | $ | 0.3 | | | $ | (5.5) | | | $ | 0.8 | | | $ | (16.4) | | | $ | (4.4) | | | $ | (16.4) | |
| Equity securities | | 4.2 | | | (0.9) | | | — | | | 12.7 | | | 16.0 | | | — | |
| Other invested assets | | — | | | — | | | — | | | 2.0 | | | 2.0 | | | — | |
| | | | | | | | | | | | |
| Total investments | | $ | 4.5 | | | $ | (6.4) | | | $ | 0.8 | | | $ | (1.7) | | | $ | 13.6 | | | $ | (16.4) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, 2023 | | | | | | | | | | | | |
| Fixed maturity securities | | $ | 0.3 | | | $ | (2.0) | | | $ | 1.6 | | | $ | (19.4) | | | $ | (0.1) | | | $ | (19.4) | |
| Equity securities | | |