What changed in this filing

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Item 9A. Controls and Procedures

2023-03-08 compared with 2022-03-08 · 493 added, 417 removed, 1538 unchanged (37% of the section changed)

13 unchanged sentences

Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

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Changes in Internal Control Over Financial Reporting

5 unchanged sentences

GAAP and includes those policies and procedures that:

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● pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

3 unchanged sentences

Because of its inherent limitations, a system of internal control over financial reporting can provide only reasonable assurance and may not prevent or detect misstatements.

Further, because of changes in conditions, effectiveness of internal control over financial reporting may vary over time.

Further, because of changes in conditions, the effectiveness of internal control over financial reporting may vary over time.

Our system contains self-monitoring mechanisms, and actions are taken to correct deficiencies as they are identified.

1 unchanged sentence

Based on this evaluation, our management concluded that our system of internal control over financial reporting was effective as of December 31, 2022.

The effectiveness of our internal control over financial reporting has been audited by BDO USA, LLP, an independent registered public accounting firm, as stated in their report, which is included herein.

The effectiveness of our internal control over financial reporting has been audited by Deloitte Ltd., an independent registered public accounting firm, as stated in their report, which is included herein.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and the Board of Directors of Greenlight Capital Re, Ltd.

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Greenlight Capital Re, Ltd.

and subsidiaries (the “Company”) as of December 31, 2022, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2022, of the Company and our report dated March 8, 2023, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Controls Over Financial Reporting.

Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all

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material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte Ltd.

________________________

Hamilton, Bermuda

March 8, 2023

OTHER INFORMATION

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

4 unchanged sentences

This item is omitted because a definitive proxy statement containing such information will be filed with the SEC not later than 120 days after the close of the fiscal year pursuant to Regulation 14A, which information required by this item set forth in the proxy statement is incorporated by reference.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

6 unchanged sentences

(a)(1) Financial Statements

Report of Independent Registered Public Accounting Firm (on internal control over financial reporting) ( BDO USA, LLP ;

Grand Rapids, Michigan, USA ;

Report of Independent Registered Public Accounting Firm (on the consolidated financial statements) ( Deloitte Ltd.

PCAOB ID# 5230 )

18 unchanged sentences

The financial statements of Solasglas Investments, LP required by Rule 3-09 of Regulation S-X are included in this filing as Exhibit 99.1.

* Schedules V and VI have been omitted as the information is provided in Note 7.

“Loss and Loss Adjustment Expense Reserves”.

FORM 10-K SUMMARY

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5 unchanged sentences

4.2 Indenture, dated as of August 7, 2018, between Greenlight Capital Re, Ltd.

and Wilmington Savings Fund Society, FSB, as trustee (incorporated by reference to Exhibit 4.1 of the Company Form 8-K filed on August 7, 2018) .

and Wilmington Savings Fund Society, FSB, as trustee (incorporated by reference to Exhibit 4.1 of the Company ’ s Form 8-K filed on August 7, 2018) .

4.3 Description of Registrant’s Securities .

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333-139993) .

10.7 (1) Amended and Restated Employment Agreement, dated as of December 30, 2008, by and among Greenlight Capital Re, Ltd., Greenlight Reinsurance, Ltd.

and Tim Courtis (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on January 2, 2009) .

10.8 (1) Amendment No.

1, dated February 18, 2009, to the Amended and Restated Employment Agreement, dated as of December 30, 2008, by and among Greenlight Capital Re, Ltd., Greenlight Reinsurance, Ltd.

and Tim Courtis (incorporated by reference to Exhibit 10.26 of the Company’s Form 10-K filed on February 23, 2009).

10.9 (1) Deed of Settlement and Release, effective as of September 9, 2020, by and among Tim Courtis, Greenlight Capital Re, Ltd.

and Greenlight Reinsurance, Ltd.

(incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K filed September 9, 2020).

10.7 Service Agreement, dated as of February 21, 2007, between DME Advisors, LP and Greenlight Capital Re, Ltd.

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(incorporated by reference to Exhibit 10.3 of the Company’s Form 10-Q filed on November 2, 2010) .

10.14 (1) Employment Agreement by and between Greenlight Capital Re, Ltd, Greenlight Reinsurance, Ltd.

and Simon Burton dated July 1, 2017 (incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K filed on June 2, 2017).

10.11 (1) Amended and Restated Employment Agreement, dated as of February 22, 2022, by and among Greenlight Capital Re, Ltd, Greenlight Reinsurance, Ltd.

and Simon Burton (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K filed on February 22, 2022) .

10.12 (1) Employment Agreement by and between Greenlight Reinsurance Ireland, DAC and Patrick O’Brien dated February 16, 2018 (incorporated by reference to Exhibit 10.40 to the Company’s Form 10-K filed on Feb 20, 2018) .

10.13 (1) Amendment to Employment Agreement, dated as of September 2, 2019, by and between Greenlight Reinsurance Ireland, DAC and Patrick O’Brien (incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K filed on September 3, 2019).

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10.14 Investment Advisory Agreement among DME Advisors, LP, and Solasglas Investments, LP, dated as of September 1, 2018 (incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K filed on September 4, 2018) .

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and Neil Greenspan dated December 3, 2018 (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K filed on December 7, 2018) .

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10.17 (1) Amendment to Employment Agreement, entered into as of September 2, 2019, by and among Greenlight Capital Re, Ltd., Greenlight Reinsurance, Ltd and Neil Greenspan (incorporated by reference to Exhibit 10.53 of the Company’s Form 10-K filed on March 9, 2020).

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and Laura Accurso (incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K filed May 5, 2020).

10.25 (1) Deed of Settlement and Release, dated as of October 25, 2022, by and among Greenlight Capital Re, Ltd., Greenlight Reinsurance, Ltd.

and Laura Accurso (incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K filed October 25, 2022) .

10.26 (1) Consulting Agreement, dated as of October 25, 2022, by and among Greenlight Capital Re, Ltd., Greenlight Reinsurance, Ltd.

and Laura Accurso (incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K filed October 25, 2022) .

10.27 (1) Restricted Stock Unit Award Agreement by and between Greenlight Capital Re, Ltd.

1 unchanged sentence

10.28 (1) Restricted Stock Award Agreement by and between Greenlight Capital Re, Ltd.

and Simon Burton, dated March 15, 2019.

(incorporated by reference to Exhibit 10.1 of the Company’s Form 10-Q filed on May 6, 2019) .

and Simon Burton, dated March 15, 2019 (incorporated by reference to Exhibit 10.1 of the Company’s Form 10-Q filed on May 6, 2019) .

10.29 (1) Greenlight Capital Re, Ltd.

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and the initial limited partner, dated as of January 7, 2021 (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K filed on January 12, 2021).

10.31 Amendment No.

1, dated as of December 15, 2022, to the Second Amended and Restated Exempted Limited Partnership Agreement of Solasglas Investments, LP, between DME Advisors II, LLC, as General Partner, Greenlight Reinsurance, Ltd., Greenlight Reinsurance Ireland, Designated Activity Company, Greenlight Capital Re, Ltd.

and the initial limited partner, dated as of January 7, 2021 and effective as of January 1, 2021 (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K filed on December 15, 2022) .

10.32 (1) Employment Offer, dated March 23, 2009, by and between Greenlight Reinsurance, Ltd.

5 unchanged sentences

10.35 (1) Amended and Restated Restricted Stock Award Agreement dated July 30, 2020, by and between Greenlight Capital Re, Ltd and Simon Burton (incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K filed August 5, 2020).

10.36 Letter Agreement between Greenlight Reinsurance, Ltd, Greenlight Reinsurance Ireland, DAC, DME Advisors II, LLC and DME Advisors LP, effective July 1, 2020 (incorporated by reference to Exhibit 10.9 to the Company’s Form 10-Q filed August 5, 2020).

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10.37 (1) Deed of Settlement and Release, effective as of September 4, 2020, by and among Brendan Barry, Greenlight Capital Re, Ltd.

and Greenlight Reinsurance, Ltd.

(incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K filed September 9, 2020).

10.37 Greenlight Capital Re, Ltd.

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21.1 Subsidiaries of the registrant.

23.1 Consent of Deloitte Ltd.

23.2 Consent of BDO USA, LLP.

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(ii) the Consolidated Statements of Operations;

(iii) the Consolidated Statements of Shareholders’ Equity;

(iii) the Consolidated Statements of Changes in Shareholders’ Equity;

(iv) the Consolidated Statements of Cash Flows;

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March 8, 2023 March 8, 2023

/s/ URSULINE FOLEY /s/ ALAN BROOKS

/s/ URSULINE FOLEY /s/ BRYAN MURPHY

Ursuline Foley

Director Alan Brooks

March 8, 2022 March 8, 2022

/s/ IAN ISAACS /s/ BRYAN MURPHY

Director Bryan Murphy

March 8, 2023 March 8, 2023

/s/ NEIL GREENSPAN /s/ VICTORIA GUEST

/s/ IAN ISAACS /s/ VICTORIA GUEST

Director Victoria Guest

March 8, 2023 March 8, 2023

/s/ NEIL GREENSPAN /s/ JOHNNY FERRARI

Neil Greenspan

Chief Financial Officer

(principal financial and accounting officer) Victoria Guest

(principal financial and accounting officer) Johnny Ferrari

March 8, 2023 March 8, 2023

/s/ SIMON BURTON /s/ JOHNNY FERRARI

/s/ SIMON BURTON /s/ JOSEPH PLATT

Director and Chief Executive Officer

(principal executive officer) Johnny Ferrari

(principal executive officer) Joseph Platt

March 8, 2023 March 8, 2023

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Shareholders and Board of Directors

Greenlight Capital Re, Ltd.

Grand Cayman, Cayman Islands

Opinion on Internal Control over Financial Reporting

We have audited Greenlight Capital Re, Ltd.’s (the “Company’s”) internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO criteria”).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria .

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets of the Company as of December 31, 2021 and 2020, the related consolidated statements of operations, changes in shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and financial statement schedules listed in the accompanying index and our report dated March 8, 2022 expressed an unqualified opinion thereon.

To the Shareholders and the Board of Directors of Greenlight Capital Re, Ltd.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of Greenlight Capital Re, Ltd.

(the "Company") as of December 31, 2022, the related consolidated statement of operations , changes in shareholders' equity, and cash flows, for the year ended December 31, 2022, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022, and the results of its operations and its cash flows for the year ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 8, 2023, expressed an unqualified opinion on the Company's internal control over financial reporting.

We did not audit the financial statements of Solasglas Investments, LP, an equity method investment of the Company, as of December 31, 2022 and for the year ended December 31, 2022.

The Company’s investment in Solasglas Investments, LP as of December 31, 2022 was $178.2 million, and its equity in net income of Solasglas Investments, LP was $54.8 million for the year ended December 31, 2022.

The financial statements of Solasglas Investments, LP were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for Solasglas Investments, LP, is based solely on the report of the other auditors.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying “Item 9A, Management’s Report on Internal Control over Financial Reporting”.

Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with U.S.

These financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on the Company's financial statements based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit of internal control over financial reporting in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audit also included performing such other procedures as we considered necessary in the circumstances.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

/s/ BDO USA, LLP

Grand Rapids, Michigan, U.S.A.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Loss and loss adjustment expense reserves - Refer to Notes 2 and 7 to the consolidated financial statements

Critical Audit Matter Description

The Company’s estimate of loss and loss adjustment expense reserves is derived using expected trends in claim severity and frequency and other factors that may vary significantly as claims are settled.

The estimate is sensitive to significant assumptions, including the initial expected loss ratio and loss development factors.

The estimate is also sensitive to the selection of actuarial methods and weighting of these methods applied to project the ultimate losses, the estimation of ultimate reserves associated with catastrophic events, and other factors.

Further, not all catastrophic events can be modeled using traditional actuarial methodologies, which increases the degree of judgment needed in estimating loss reserves for such events.

Auditing the Company’s methods, assumptions and best estimate of the cost of the ultimate settlement and administration of claims represented by the incurred but not reported ("IBNR") claims included in recorded Loss and loss adjustment expense

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reserves involved especially subjective auditor judgment and an increased extent of effort, including the involvement of our actuarial specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to loss and loss adjustment expense reserves included the following, among others

• We tested the effectiveness of controls over the valuation of the recorded loss and loss adjustment expense reserves, including the review and approval process that management has in place for significant actuarial methods and assumptions used and the approval of management’s best estimate of loss and loss adjustment expense reserves.

• We tested the completeness and accuracy of the underlying data that served as the basis for the Company’s actuarial analysis, including historical claims data, to test the reasonableness of key inputs to the actuarial estimate.

• With the assistance of our actuarial specialists:

– We independently developed an estimate of the reserves for selected contracts, compared our estimates to those booked by the Company, and evaluated the differences.

– We evaluated the Company’s methodologies against recognized actuarial practices for the remaining contracts.

We also evaluated the assumptions used by the Company using our industry knowledge and experience and other analytical procedures.

– We compared the results of the quarterly reserve studies prepared by independent external actuaries to management’s best estimate and evaluated the differences.

/s/ Deloitte Ltd.

_____________________________

Hamilton, Bermuda

March 8, 2023

We have served as the Company's auditor since 2022.

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Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Greenlight Capital Re, Ltd.

(the “Company”) as of December 31, 2021 and 2020, the related consolidated statements of operations, changes in shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2021 and the related notes and financial statement schedules listed in the accompanying index (collectively referred to as the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2021 , in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Compan y Accounting Oversight Board (United States) (“PCAOB”), the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) and our report dated March 8, 2022 expressed an unqualified opinion thereon.

We did not audit the financial statements of Solasglas Investments, LP, an equity method investment of the Company, as of December 31, 2021 and 2020, and for the three years in the period ended December 31, 2021.

The Company’s investment in Solasglas Investments, LP as of December 31, 2021 and 2020 was $183.6 million and $166.7 million, respectively, and its equity in net income of Solasglas Investments, LP was $18.1 million, $4.4 million and $46.1 million for the years ended December 31, 2021, 2020 and 2019, respectively.

We have audited the accompanying consolidated balance sheet of Greenlight Capital Re, Ltd.

(the “Company”) as of December 31, 2021, the related consolidated statements of operations, changes in shareholders’ equity, and cash flows for each of the two years in the period ended December 31, 2021 and the related notes and financial statement schedules listed in the accompanying index (collectively referred to as the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2021, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2021 , in conformity with accounting principles generally accepted in the United States of America.

We did not audit the financial statements of Solasglas Investments, LP, an equity method investment of the Company, as of December 31, 2021, and for the two years in the period ended December 31, 2021.

The Company’s investment in Solasglas Investments, LP as of December 31, 2021 was $183.6 million, and its equity in net income of Solasglas Investments, LP was $18.1 million and $4.4 million for the years ended December 31, 2021 and 2020, respectively.

2 unchanged sentences

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

5 unchanged sentences

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

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Incurred But Not Reported (IBNR) Loss Reserves

As described in Note 2 and Note 7 to the Company’s consolidated financial statements, the Company’s loss and loss adjustment expense reserves were $524.0 million for the year ended December 31, 2021.

The total reserve was made up of $190.2 million of case reserves and $333.8 million of IBNR reserves.

Case reserves have resulted from claims notified to the Company by its clients.

IBNR loss reserves relate to claims that have been incurred by insureds and reinsureds but have not yet been reported to the insurer or reinsurer, including unknown future developments on amounts already known by the insurer or reinsurer.

The calculation of the IBNR reserves requires the Company’s reserving actuaries to calculate a best, or “point,” estimate of reserves for each contract.

To calculate this estimate, a number of different actuarial methodologies and key assumptions are weighted and applied to each individual contract.

We identified the IBNR portion of the Company’s loss and loss adjustment expense reserves as a critical audit matter.

The Company’s actuarial methodologies and key assumptions used to calculate IBNR loss reserves are highly subjective and can have a significant impact on the loss and loss adjustment expense reserve.

Auditing these methodologies and key assumptions used involves a high degree of subjective auditor judgment due to the assessment of risk and nature and extent of specialized skill and knowledge needed to address the risk.

The primary procedures we performed to address this critical audit matter included:

• Testing the design and effectiveness of the controls relating to management’s loss reserving process, including:

• Management’s review of the completeness and accuracy of source data provided by cedents.

• Management’s review of internally selected actuarial methodologies and key assumptions used.

• Management’s review of the independent external actuarial report, which includes an independent recommended reserve balance.

A comparison is performed between the Company’s internal reserve balance and the recommended balance per the independent external actuary.

• Reviewing the development of prior year estimates of IBNR loss reserves.

• Testing the completeness and accuracy of the source information used by the Company and any additional source information used by BDO’s actuarial specialists to calculate the IBNR loss reserves.

• Utilizing personnel with specialized knowledge and skill in actuarial services to:

(i) evaluate the appropriateness of the methodology and the assumptions used by management and management’s specialist and (ii) evaluate the reasonableness of the Company’s loss and loss adjustment expense reserves by developing an independent estimate and reasonable range of actuarial central estimates based on an alternative combination of methods, assumptions and/or segmentation of the data.

/s/ BDO USA, LLP.

We have served as the Company's auditor since 2006.

We have served as the Company's auditor from 2006 to 2022

Grand Rapids, Michigan, U.S.A.

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Opinion on the Financial Statements

We have audited the accompanying statements of assets, liabilities and partners’ capital of Solasglas Investments, LP (the “Partnership”), including the condensed schedules of investments, as of December 31, 2021 and 2020, the related statements of operations, changes in partners’ capital and cash flows for the years December 31, 2021, December 31, 2020 and December 31, 2019, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Partnership at December 31, 2021 and 2020, and the results of its operations, changes on its partners’ capital and its cash flows for the years ended December 31, 2021, December 31, 2020 and December 31, 2019 in conformity with U.S.

We have audited the accompanying statements of assets, liabilities and partners’ capital of Solasglas Investments, LP (the “Partnership”), including the condensed schedules of investments, as of December 31, 2022 and 2021, the related statements of operations, changes in partners’ capital and cash flows for the years ended December 31, 2022, December 31, 2021 and December 31, 2020, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Partnership at December 31, 2022 and 2021, and the results of its operations, changes in its partners’ capital and its cash flows for the years ended December 31, 2022, December 31, 2021 and December 31, 2020 in conformity with U.S.

generally accepted accounting principles.

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Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved especially challenging, subjective, or complex judgments.

We determined that there are no critical audit matters.

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Unearned premiums ceded 18,153 42

Notes receivable — 6,101

Other assets 6,019 5,885

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Total liabilities 1,077,261 951,831

Commitments and Contingencies (Note 15)

Shareholders' equity

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Net income (loss) $ 25,342 $ 17,578 $ 3,866

Earnings (loss) per share

Earnings (loss) per share (Class A and Class B) (Note 2)

Basic $ 0.75 $ 0.51 $ 0.11

Diluted $ 0.73 $ 0.51 $ 0.11

Weighted average number of ordinary shares used in the determination of earnings and loss per share

Weighted average number of ordinary shares used in the determination of earnings and loss per share (Note 2)

Basic 33,908,156 34,204,364 36,172,216

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Balance - beginning of period 481,784 488,488 503,547

Cumulative effect of adoption of accounting guidance for convertible debt at January 1, 2022 ( 7,896 ) — —

Repurchase of Class A ordinary shares ( 34 ) ( 9,891 ) ( 17,526 )

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Balance - beginning of period ( 9,505 ) ( 27,083 ) ( 30,063 )

Repurchase of Class A ordinary shares — — —

Cumulative effect of adoption of accounting guidance for convertible debt at January 1, 2022 5,362 — —

Cumulative effect of adoption of accounting guidance for expected credit losses at January 1, 2020 — — ( 886 )

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Loss (income) from investments in related party investment fund ( 54,844 ) ( 18,087 ) ( 4,431 )

Net realized gain on repurchase of convertible senior notes payable ( 343 ) — —

Loss (income) from investment accounted for under the equity method — — ( 843 )

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Net realized (gains) losses on investments and notes receivable — ( 14,210 ) 9,234

Foreign exchange (gains) losses on investments 45 83 270

Foreign exchange (gains) losses 6,174 45 83

Current expected credit losses recognized on notes receivable and reinsurance assets 282 — ( 750 )

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Proceeds from sales of investments — 20,755 —

Change in due to related party investment fund — — ( 9,642 )

Change in notes receivable — 6,101 19,867

Non-controlling interest withdrawal from related party joint venture, net — — ( 1,278 )

Net cash provided by (used in) investing activities 47,015 23,091 95,626

Financing activities

Repurchases of convertible senior notes payable ( 19,793 ) — —

Repurchase of Class A ordinary shares ( 35 ) ( 10,000 ) ( 17,781 )

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Income tax paid in cash 664 3,703 —

Non-cash transfer of investments — — 36,673

Non-cash addition of right-of-use asset — — 323

The accompanying Notes to the Consolidated Financial Statements are an

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(“Greenlight Re”), provides global specialty property and casualty reinsurance.

Greenlight Re has a Class D insurer license issued in accordance with the terms of The Insurance Act, 2010 (as amended) and underlying regulations thereto (the “Act”) and is subject to regulation by the Cayman Islands Monetary Authority, in terms of the Act.

Greenlight Re commenced underwriting in April 2006.

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In 2020, GLRE established Greenlight Re Marketing (UK) Limited (“Greenlight Re UK”) as a wholly-owned subsidiary to increase the Company’s presence in the London market.

In 2022, Greenlight Innovation Syndicate 3456 (“Syndicate 3456”) commenced underwriting under the Lloyd’s syndicate-in-a-box model, with Greenlight Re as the sole capital provider.

As used herein, the “Company” refers collectively to GLRE and its consolidated subsidiaries.

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These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

The consolidated financial statements include the accounts of GLRE and the consolidated financial statements of its wholly-owned subsidiaries, Greenlight Re, GRIL, Verdant, and Greenlight Re UK.

The consolidated financial statements include the accounts of GLRE and the consolidated financial statements of its wholly-owned subsidiaries, Greenlight Re, GRIL, Verdant, and Greenlight Re UK, as well as Syndicate 3456.

All significant intercompany transactions and balances have been eliminated on consolidation.

Significant estimates used in the preparation of the Company’s consolidated financial statements, including those associated with premiums and the estimations of loss and loss adjustment expense reserves, including losses arising from the novel coronavirus (the “COVID-19 pandemic”), may be subject to significant adjustments in future periods.

(See Note 7 for the significant assumptions that served as the basis for the Company's reserve estimates for the COVID-19 pandemic).

Significant estimates used to prepare the Company’s consolidated financial statements, including those associated with premiums and the estimations of loss and loss adjustment expense reserves, may be subject to significant adjustments in future periods.

SIGNIFICANT ACCOUNTING POLICIES

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The significant estimates reflected in the Company’s consolidated financial statements include, but are not limited to, loss and loss adjustment expense reserves, premiums written, earned and receivable, variability underlying risk transfer assessments, allowances for credit losses, share-based compensation, valuation allowances associated with deferred tax assets and investment impairments.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash and certain short-term, highly liquid investments with original maturity dates of three months or less.

Restricted Cash and Restricted Cash Equivalents

Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents

Cash and cash equivalents consist of cash and short-term, highly liquid investments and certificates of deposit with original maturity dates of three months or less.

Certificates of deposit with original maturities greater than three months are included under the caption "Other investments" on the consolidated balance sheets.

The Company maintains cash and cash equivalent balances to collateralize regulatory trusts and letters of credit issued to cedents (see Notes 6 and 15).

The following table reconciles the cash, cash equivalents, and restricted cash reported within the consolidated balance sheets to the total presented in the consolidated statements of cash flows:

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The following table reconciles the cash, cash equivalents, and restricted cash reported within the consolidated balance sheets to the total presented in the consolidated statements of cash flows:

December 31, 2022 December 31, 2021

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The Company’s management reviews premium estimates at least quarterly.

Such review includes a comparison of actual reported premiums to expected ultimate premiums, along with a review of the aging and collection of premiums.

Such review includes a comparison of reported premiums to expected ultimate premiums, along with a review of the aging and collection of premiums.

Management evaluates the appropriateness of the premium estimates on the basis of these reviews and records any adjustments to these estimates in the period in which they are determined.

Changes in premium estimates, including premium receivable on both excess of loss and quota share contracts, are not unusual and may result in significant adjustments in any period.

A portion of amounts included in the caption “Reinsurance balances receivable” in the Company’s consolidated balance sheets represent estimated premiums written, net of commissions and brokerage, and are not currently due based on the terms of the underlying contracts.

A portion of amounts included in the caption “Reinsurance balances receivable” in the Company’s consolidated balance sheets represent estimated premiums written, net of commissions and brokerage, that are not currently due based on the terms of the underlying contracts.

Additional premiums due on a contract with no remaining coverage period are earned in full when written.

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Funds Held by Cedents

The caption “Reinsurance balances receivable” in the Company’s consolidated balance sheets includes amounts held by cedents.

Such amounts include premiums and funds held at Lloyd’s, which is held in trust at Lloyd's as security for members’ underwriting activities.

The caption “Reinsurance balances receivable” in the Company’s consolidated balance sheets includes financial assets held by cedents.

At December 31, 2022, funds held by cedents were $ 337.4 million (December 31, 2021:

$ 246.9 million).

Such amounts include premiums withheld by Lloyd’s syndicates and funds contributed by the Company to Lloyd's as security for members’ underwriting activities.

The Lloyd’s syndicates invest a portion of the premiums withheld in investment funds and fixed-maturity securities.

The Company records its share of income (or expense) from these assets, when reported by the syndicates, in its consolidated statements of operations under the caption “Other income (expense).”

Reinsurance Premiums Ceded

The Company reduces the risk of future losses on business assumed by reinsuring certain risks and exposures with other reinsurers (referred to as “retrocessionaires”).

The Company remains liable to the extent that any retrocessionaire fails to meet its obligations and to the extent the Company does not hold sufficient security for their unpaid obligations.

The Company remains liable to the extent that any retrocessionaire fails to meet its obligations and to the extent the Company does not hold sufficient security for its unpaid obligations.

Ceded premiums are written during the period in which the risks incept and the associated expense is recognized over the contract period in proportion to the protection provided.

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The Company presents acquisition costs incurred on reinsurance assumed net of commissions earned on reinsurance ceded.

However, if the sum of a contract’s expected losses and loss expenses and deferred acquisition costs exceeds associated unearned premiums and expected investment income, a premium deficiency is determined to exist.

However, if the sum of a contract’s expected losses and loss expenses and deferred acquisition costs exceeds associated unearned premiums and expected investment income, a

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premium deficiency is determined to exist.

In this event, the Company writes off deferred acquisition costs to the extent necessary to eliminate the premium deficiency.

If the premium deficiency exceeds deferred acquisition costs, the Company accrues a liability for the excess deficiency.

If the premium deficiency exceeds deferred acquisition costs, the Company accrues a liability for the deficiency.

The Company did not recognize any premium deficiency adjustments during the periods presented.

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Policy acquisition costs also include profit commissions, which the Company recognized on a basis consistent with its estimate of losses and loss expenses.

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● case reserves for loss and loss adjustment expenses resulting from claims notified to the Company by its clients;

● reserves for estimated loss and loss adjustment expenses that have been incurred by insureds and reinsureds but not yet reported to the insurer or reinsurer (“IBNR”), including unknown future developments on loss and loss adjustment expenses that are known to the insurer or reinsurer.

● reserves for estimated loss and loss adjustment expenses incurred by insureds and reinsureds but not yet reported to the insurer or reinsurer (“IBNR”), including unknown future developments on loss and loss adjustment expenses that are known to the insurer or reinsurer.

The Company estimates these reserves based on reports from ceding companies, industry data, and historical experience analyzed using standard actuarial and statistical techniques.

The analysis performed includes an assessment of currently available data, predictions of future developments, estimates of future trends, and other factors.

The analysis includes assessing currently available data, predictions of future developments, estimates of future trends, and other factors.

These estimates are reviewed by the Company’s reserving committee at least quarterly and adjusted as necessary.

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GAAP does not permit establishing loss reserves, which include case reserves and IBNR loss reserves, until the occurrence of an event that may give rise to a claim.

As a result, only loss reserves applicable to losses incurred up to the reporting date are established, with no allowance for the establishment of loss reserves to account for expected future loss events.

Loss and loss adjustment expenses recoverable represent the amounts due from retrocessionaires for unpaid loss and loss adjustment expenses on retrocession agreements.

Ceded IBNR recoverable is estimated based on the Company’s actuarial estimates.

As a result, only loss reserves applicable to losses incurred up to the reporting date are established.

There is no allowance for the establishment of loss reserves to account for expected future loss events.

The caption, “Loss and loss adjustment expenses recoverable” in the Company’s consolidated balance sheets represents the amounts due from retrocessionaires for unpaid loss and loss adjustment expenses on retrocession agreements.

Ceded IBNR recoverable amounts are estimated based on the Company’s actuarial estimates.

These estimates are reviewed periodically and adjusted when deemed necessary.

The Company may be unable to recover the loss and loss adjustment expense recoverable amounts due as a result of the retrocessionaires’ inability to pay.

The Company regularly evaluates the financial condition of its retrocessionaires and records provisions for uncollectible reinsurance expenses recoverable when recovery is no longer probable.

For natural peril exposed business, loss reserves are generally established based on loss payments and case reserves reported by clients when, and if, received.

The Company regularly evaluates the financial condition of its retrocessionaires and calculates an allowance for expected credit losses (see “Reinsurance Assets ” below).

For losses stemming from exposure to natural perils, loss reserves are generally established based on loss payments and case reserves reported by clients when, and if, received.

Estimates for IBNR losses are added to the case reserves as the Company deems appropriate.

To establish catastrophe IBNR loss estimates, the Company uses estimates communicated by ceding companies, industry data and information, knowledge of the business written, and management’s judgment.

For all non-natural peril business, initial reserves for each contract are determined based on a combination of (i) the pricing analysis of the expected loss ratio performed prior to binding the contract;

For contracts without significant exposure to natural perils, initial reserves for each contract are determined based on a combination of (i) the pricing analysis performed prior to binding the contract;

(ii) the underwriter’s detailed knowledge of the cedent, its operations and future business plans;

and (iii) the professional judgment and recommendation of the Chief Actuary.

In the pricing analysis, the Company utilizes information both from the individual client and from industry data.

In the pricing analysis, the Company utilizes information from the client and industry data.

This information typically includes, but is not limited to, data related to premiums, losses, exposure, business mix, industry performance, and associated trends covering as much history as deemed appropriate.

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The terms and conditions of each contract specify the data reporting requirements.

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Generally, the Company obtains regular updates of premium and loss-related information for the current and historical periods and utilizes them to update the initially expected loss ratio.

There may be a lag between (i) claims being reported by the underlying insured to the Company’s cedent and (ii) claims being reported by the Company’s cedent to the Company.

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may impact the Company’s loss reserve estimates.

This lag may impact the Company’s loss reserve estimates.

Client reports have pre-determined due dates (for example, fifteen days after each month-end).

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Accordingly, there should be a short lag in such reporting.

Additionally, most of the contracts that have the potential for large single event losses have provisions that such loss notifications are provided to the Company immediately upon the occurrence of an event.

Once the updated information is received, the Company uses various standard actuarial methods for its analysis each quarter.

Additionally, most contracts that have the potential for large single-event losses have provisions that such loss notifications are provided to the Company immediately upon the occurrence of an event.

Once the updated information is received, the Company uses various standard actuarial methods for its quarterly analysis.

Such methods typically include the following:

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The expected loss ratio is often determined using industry data, historical company data, past pricing or reserving analysis performed, and actuarial judgment.

This method is typically used for lines of business and contracts where there are no historical losses or where past loss experience is not considered applicable to the current period.

This method is typically used for lines of business and contracts where there are no (or insignificant) historical losses or where past loss experience is not considered applicable to the current period.

● Bornhuetter-Ferguson paid loss method:

Ultimate losses are estimated by modifying expected loss ratios to the extent that paid losses experienced to date differ from what would have been expected to have been paid based upon the selected paid loss development pattern.

This method avoids some of the distortions that could result from a large development factor being applied to a small base of paid losses to calculate ultimate losses.

Ultimate losses are estimated by modifying expected loss ratios to the extent losses paid to date differ from what would have been expected based upon the selected paid loss development pattern.

This method avoids some distortions that could result from a large development factor being applied to a small base of paid losses to calculate ultimate losses.

● Bornhuetter-Ferguson reported loss method:

Ultimate losses are estimated by modifying expected loss ratios to the extent reported losses experienced to date differ from what would have been expected to have been reported based upon the selected reported loss development pattern.

This method avoids some of the distortions that could result from a large development factor being applied to a small base of reported losses to calculate ultimate losses.

Ultimate losses are estimated by modifying expected loss ratios to the extent losses reported to date differ from what would have been expected based upon the selected reported loss development pattern.

This method avoids some distortions that could result from a large development factor being applied to a small base of reported losses to calculate ultimate losses.

● Frequency / Severity method:

Ultimate losses are estimated under this method by multiplying the ultimate number of claims (i.e., the frequency multiplied by the exposure base on which the frequency has been determined) by the estimated ultimate average cost per claim (i.e., the severity).

Ultimate losses are estimated by multiplying the ultimate number of claims (i.e., the frequency multiplied by the exposure base) by the estimated average cost per claim (i.e., the severity).

This approach enables trends and patterns in the rates of claims emergence (i.e., reporting) and settlement (i.e., closure) and the average cost of claims to be analyzed separately.

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For each contract, the Company utilizes reserving methodologies it considers appropriate to calculate a best estimate of reserves.

The decision of whether to use a single methodology or a combination depends upon the portfolio segment being analyzed and the actuaries’ judgment.

Whether the Company uses a single methodology or a combination depends upon the portfolio segment being analyzed and the actuary’s judgment.

The Company’s reserving methodology does not require a fixed weighting of the various methods used.

Certain methods are considered more appropriate than others depending on the type, structure, age, maturity, and duration of the expected losses on the contract.

For example, the ultimate incurred loss for relatively new contracts (and therefore have experienced little paid loss development) may be more appropriately estimated using a Bornhuetter-Ferguson reported loss method than a paid loss development method.

For example, the Bornhuetter-Ferguson reported loss method might be more appropriate than a paid loss development method for relatively new contracts that have experienced little paid loss development.

The Company’s gross aggregate reserves are the sum of the best estimate reserves of all portfolio exposures.

Generally, IBNR loss reserves are calculated by estimating the ultimate incurred losses at any point in time and subtracting cumulative paid claims and case reserves.

Generally, IBNR loss reserves are calculated by estimating the ultimate incurred losses and subtracting cumulative paid claims and case reserves.

Each quarter, the Company’s Reserving Committee, led by the Chief Actuary, meets to assess the adequacy of our loss reserves based on the reserve analysis and recommendations prepared by the Company’s reserving department.

The Reserving Committee reviews, discusses, and puts forward a loss reserve recommendation for the Audit Committee’s approval.

Additionally, an independent third-party actuarial firm performs a quarterly reserve review and annually opines on the reasonableness and adequacy of the aggregate loss reserves.

The Company provides the third-party actuarial firm with its pricing models, reserving analysis, and other data.

Additionally, the actuarial firm may inquire as to the various assumptions and estimates used in the reserving analysis.

The actuarial firm independently creates its own reserving models based on industry loss information, augmented by client-specific loss information and independent assumptions and estimates.

Based on various reserving methodologies that the actuarial firm considers appropriate, it creates a loss reserve estimate for each segment in the portfolio.

It recommends an aggregate loss reserve, including IBNR.

In the event of material differences between the Company's aggregated booked reserves and the actuarial firm's recommended reserves, the reserving committee and Audit

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Committee would be notified, with the reserves adjusted as deemed appropriate.

To date, there have been no material differences resulting from the external actuary’s reviews requiring adjustments to the Company’s booked reserves.

The Company does not typically experience significant claims processing backlogs, although such backlogs may occur following a major catastrophic event.

At December 31, 2022, and 2021, the Company did not have a significant backlog in our claims processing.

There were no significant changes in the actuarial methodology or assumptions relating to the Company’s loss and loss adjustment expense reserves during the years ended December 31, 2021, and 2020.

The Company did not make any significant changes to the actuarial methodology or assumptions relating to its loss and loss adjustment expense reserves during the years ended December 31, 2022, and 2021.

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Reinsurance Assets

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The Company manages its credit risk in its reinsurance assets by transacting only with insurers and reinsurers that it considers financially sound.

Credit ratings of the counterparties are forward-looking and consider a variety of economic scenarios.

The Company's evaluation of the required allowance for reinsurance balances receivable and loss and loss adjustment expenses recoverable considers the current economic environment as well as macroeconomic outcomes.

Credit ratings of the counterparties are forward-looking and consider various economic scenarios.

For its retrocessional counterparties that are unrated, the Company may hold collateral in the form of funds withheld, trust accounts, or irrevocable letters of credit.

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The Company regularly evaluates its net credit exposure to assess the ability of cedents and retrocessionaires to honor their respective obligations.

At December 31, 2021, the Company has recorded an allowance for expected credit loss on its Reinsurance Assets of $ 0.1 million.

(December 31, 2020, $ 0.1 million).

At December 31, 2022, the Company has recorded an allowance for expected credit loss on its Reinsurance Assets of $ 0.4 million (December 31, 2021, $ 0.1 million).

Deposit Assets and Liabilities

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The Company records deposit assets and liabilities in its consolidated balance sheets in the caption “Reinsurance balances receivable” and “Reinsurance balances payable,” respectively.

At December 31, 2021, deposit assets and deposit liabilities were $ 3.5 million and $ 18.6 million, respectively (December 31, 2020:

At December 31, 2022, deposit assets and liabilities were $ 3.1 million and $ 10.7 million, respectively (December 31, 2021:

$ 3.5 million and $ 18.6 million, respectively).

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Deposit interest income (expense), net $ ( 6,717 ) $ ( 11,655 ) $ 1,711

Equity Method Accounted Investments

The Company accounts for its investments in investee companies that are not consolidated but over which the Company exercises significant influence under the equity method of accounting.

Whether the Company exercises significant influence with respect to an investee depends on an evaluation of several factors including, among others, representation on the investee company’s board of directors and ownership level, which is generally a 20% to 50% interest in the voting securities of the investee company.

Under the equity method of accounting, an investee company’s accounts are not reflected within the Company’s consolidated balance sheets and statements of operations;

however, the Company’s share of the earnings or losses of the investee company is reflected in the caption ‘‘Net investment income (loss)’’ in the consolidated statements of

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The Company’s carrying value in an equity method investee company is reflected in the caption ‘‘Other investments’’ in the Company’s consolidated balance sheets.

When the Company’s carrying value in an equity method investee company is reduced to zero, no further losses are recorded in the Company’s consolidated financial statements unless the Company guaranteed the obligations of the investee company or has committed additional funding (see Notes 3 and 4).

Variable Interest Entities

The Company accounts for the investments it makes in certain legal entities in which equity investors do not have (1) sufficient equity at risk for the legal entity to finance its activities without additional subordinated financial support, or (2) as a group, the holders of the equity investment at risk do not have either the power, through voting or similar rights, to direct the activities of the legal entity that most significantly impact the entity’s economic performance, or (3) the obligation to absorb the expected losses of the legal entity or the right to receive expected residual returns of the legal entity.

These legal entities are referred to as “variable interest entities” or “VIEs.”

The Company would consolidate the results of any such entity in which it determined that it had a controlling financial interest.

The Company would have a “controlling financial interest” in such an entity if the Company had both the power to direct the activities that most significantly affect the VIE’s economic performance and the obligation to absorb the losses of, or right to receive benefits from, the VIE that could be potentially significant to the VIE.

On a quarterly basis, the Company reassesses whether it has a controlling financial interest in any such entities .

Financial Instruments

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The Company has established a stock incentive plan for directors, employees, and consultants.

The Company recognizes share-based compensation costs based on the fair value at the grant date of the award.

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The Company recognizes share-based compensation costs based on the fair value at the award’s grant date.

The Company measures compensation for restricted shares and restricted stock units (“RSUs”) based on the price of the Company’s common shares at the grant date.

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In determining the grant date fair value, the Company uses the entire ten-year life of the options as the estimated term and assumes no forfeitures and no dividends paid during the life of the options.

The Company bases its estimate of expected volatility on the daily historical trading data of the Company’s Class A ordinary shares from the date these shares commenced trading (May 24, 2007) to the grant date.

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The Company bases its estimate of expected volatility on the daily historical trading data of the Company’s Class A ordinary shares from the date they commenced trading (May 24, 2007) to the grant date.

For share purchase options issued under the employee stock incentive plan, the compensation cost is calculated and recognized over the vesting periods on a graded vesting basis (see Note 11).

Convertible Notes

The Company has determined that the senior convertible notes’ cash conversion option represents an embedded derivative and has bifurcated it from the underlying contract for financial reporting purposes.

Prior to the adoption of Accounting Standards Update (“ASU”) 2020-06 in January 2022, “Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity's Own Equity (“ASU 2020-06”),” the Company determined that the senior convertible notes’ cash conversion option represented an embedded derivative and bifurcated it from the underlying contract for financial reporting purposes.

For the debt component, the Company recorded a liability equivalent to the present value of comparable debt without the conversion features at the time of issuance.

The remainder of the proceeds, which represented the embedded derivative, was included in the caption “Additional paid-in capital” in the Company’s consolidated balance sheets.

Upon adoption of ASU 2020-06, U.S.

GAAP no longer permits entities to bifurcate embedded conversion features from the underlying contract.

Therefore, effective January 1, 2022, the Company no longer presents the embedded conversion features separately in equity;

instead, the Company’s senior convertible debt is presented as a single liability in the Company’s consolidated balance sheet.

See the below section captioned “Recently Issued Accounting Standards Adopted” for the impact of the new accounting standard on the Company’s accounting of its senior convertible notes.

Costs incurred in issuing the convertible notes consisted primarily of underwriting, legal, accounting, and printing fees.

The Company allocated the costs associated with the debt and derivative components ratably to the liability and shareholders’ equity balances, respectively.

The debt-related portion of these costs has been capitalized and deducted from the principal of senior convertible notes payable in the Company’s consolidated balance sheets.

These costs are amortized over the term of the debt and are included in the caption “Interest expense” in the Company’s consolidated statements of operations.

The Company has allocated a portion of the issuance costs to the embedded derivative and deducted this portion from additional paid-in capital.

A recently issued U.S.

GAAP accounting standard no longer permits entities to bifurcate embedded conversion features from the underlying contract.

See the below section captioned “Recently Issued Accounting Standards Not Yet Adopted” for the impact of the new accounting standard on the Company’s accounting of its senior convertible notes.

Foreign Exchange

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The Company records foreign currency transactions at the exchange rates in effect on the transaction date.

Monetary assets and liabilities in foreign currencies at the balance sheet date are converted at the exchange rate in effect at the balance sheet date and exchange gains and losses, if any, are included in the caption “Other income (expense), net” in the Company’s consolidated statements of operations.

Monetary assets and liabilities in foreign currencies are converted at the exchange rate in effect at the balance sheet date.

Non-monetary assets and liabilities denominated in foreign currencies are carried at their historical exchange rates.

The Company includes any foreign exchange gains and losses under the caption “Other income (expense), net” in the Company’s consolidated statements of operations.

For the years ended December 31, 2022, 2021, and 2020, $( 6.2 ) million, $( 1.6 ) million, and $ 0.3 million, respectively, of foreign exchange gains (losses) were included in the Company’s net income in the consolidated statements of operations.

Derivative instruments

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The Company recognizes derivative financial instruments in the consolidated balance sheets at their fair values.

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The Company does not offset these balances against collateral pledged or received.

The caption “Other assets” in the Company’s consolidated balance sheets consists primarily of prepaid expenses, fixed assets, right-of-use lease assets, other receivables, and deferred tax assets.

The caption “Other assets” in the Company’s consolidated balance sheets consists primarily of prepaid expenses, right-of-use lease assets, other receivables, taxes recoverable, and deferred tax assets.

Other Liabilities

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Earnings (Loss) Per Share

The Company’s unvested restricted stock awards, which contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, are considered “participating securities” for the purposes of calculating earnings (loss) per

The Company has issued unvested restricted stock awards, some of which contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid.

These awards are considered “participating securities” for the purposes of calculating earnings (loss) per share.

Basic earnings per share is calculated on the basis of the weighted average number of ordinary shares and participating securities outstanding during the period.

Diluted earnings (or loss) per share includes the dilutive effect, if any, of the following:

• Restricted Stock Units (“RSUs”) issued that convert to ordinary shares upon vesting;

• Unvested restricted share awards which are not considered “participating securities”;

• Additional potential ordinary shares issuable when in-the-money stock options are exercised, determined using the treasury stock method;

• For periods prior to January 1, 2022, those ordinary shares with the potential to be issued in connection with convertible notes and other such convertible instruments, determined using the treasury stock method;

• Effective January 1, 2022, the dilutive effect of the convertible notes calculated using the if-converted method.

Under the if-converted method, the convertible notes are assumed to be converted at the beginning of the period.

The resulting common shares are included in the denominator of the diluted net income per common share calculation.

Interest expense related to the convertible notes incurred in the period is added back to the numerator for purposes of the if-converted calculation.

Diluted earnings (or loss) per share contemplates a conversion to ordinary shares of all convertible instruments only if they are dilutive.

In the event of a net loss, all RSUs, stock options, shares potentially issuable in connection with convertible notes, and participating securities are excluded from the calculation of both basic and diluted loss per share as their inclusion would be anti-dilutive.

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Basic earnings per share is calculated on the basis of the weighted average number of common shares and participating securities outstanding during the period.

Diluted earnings (or loss) per share includes the dilutive effect of the following:

• Restricted Stock Units (“RSUs”) issued that would convert to common shares upon vesting;

• additional potential common shares issuable when in-the-money stock options are exercised, determined using the treasury stock method;

• those common shares with the potential to be issued in connection with convertible debt and other such convertible instruments, determined using the treasury stock method.

Diluted earnings (or loss) per share contemplates a conversion to common shares of all convertible instruments only if they are dilutive with regards to earnings per share.

In the event of a net loss, all RSUs, stock options, convertible debt, and participating securities are excluded from the calculation of both basic and diluted loss per share as their inclusion would be anti-dilutive.

The table below presents the shares outstanding for the calculation of earnings (loss) per share for the years ended December 31, 2021, 2020, and 2019:

The following table reconciles net income (loss) and weighted average shares used in computing basic and diluted net income per share for the years ended December 31, 2022, 2021, and 2020 (expressed in thousands of U.S.

dollars, except per share and share amounts):

2022 2021 2020

Numerator for earnings per share

Net income (loss) - basic $ 25,342 $ 17,578 $ 3,866

interest on convertible notes 4,201 — —

gain on debt repurchases ( 343 ) — —

Net income (loss) - diluted $ 29,200 $ 17,578 $ 3,866

Denominator for earnings per share

Weighted average shares outstanding - basic 33,908,156 34,204,364 36,172,216

Effect of dilutive employee and director share-based awards 368,096 146,652 105,812

Shares potentially issuable in connection with convertible notes 5,493,538 — —

Weighted average shares outstanding - diluted 39,769,790 34,351,016 36,278,028

Anti-dilutive stock options outstanding 690,337 735,627 835,627

Participating securities excluded from calculation of loss per share — — 936,669

Earnings (loss) per share (Class A and Class B)

Basic $ 0.75 $ 0.51 $ 0.11

Diluted 0.73 0.51 0.11

Under current Cayman Islands law, no corporate entity, including GLRE and Greenlight Re, is obligated to pay taxes in the Cayman Islands on either income or capital gains.

The Company has an undertaking from the Governor-in-Cabinet of the Cayman Islands, pursuant to the provisions of the Tax Concessions Act, as amended, that, in the event that the Cayman Islands enacts any legislation that imposes tax on profits, income, gains or appreciations, or any tax in the nature of estate duty or inheritance tax, such tax will not be applicable to GLRE, Greenlight Re nor their respective operations, or to the Class A or Class B ordinary shares or related obligations, before February 1, 2025.

The Company has an undertaking from the Governor-in-Cabinet of the Cayman Islands, pursuant to the provisions of the Tax Concessions Act, as amended, that, in the event that the Cayman Islands enacts any legislation that imposes a tax on profits, income, gains, or appreciations, or any tax in the nature of estate duty or inheritance tax, such tax will not be applicable to GLRE, Greenlight Re nor their respective operations, or to the Class A or Class B ordinary shares or related obligations, before February 1, 2025.

Verdant is incorporated in Delaware and therefore is subject to taxes in accordance with the U.S.

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Verdant’s taxable income is generally expected to be taxed at a marginal rate of 21% (2021:

Verdant’s tax years 2018 and beyond remain open and subject to examination by the IRS.

Verdant’s tax years 2018 and beyond remain open and may be subject to examination by the IRS.

GRIL is incorporated in Ireland and therefore is subject to the Irish corporation tax rate of 12.5% on its trading income and 25% on its non-trading income.

Greenlight Re UK is incorporated in the United Kingdom and therefore is subject to the U.K.

corporate tax rate of 19% on its profits.

The Company records a valuation allowance to the extent that the Company considers it more likely than not that all or a portion of the deferred tax asset will not be realized in the future.

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The Company has one operating segment, Property and Casualty Reinsurance.

Recent Accounting Pronouncements

Recently Issued Accounting Standards Adopted

In January 2020, the FASB issued ASU No.

2020-01, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the Emerging Issues Task Force) (“ASU 2020-01”).

ASU 2020-01 clarifies

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interactions between the accounting guidance for (i) certain equity securities under Topic 321, (ii) investments under the equity method of accounting in Topic 323, and (iii) certain derivative instruments in Topic 815.

ASU 2020-01 is effective for public business entities for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years.

The adoption of ASU 2020-01 during the first quarter of 2021 had no material impact on the Company’s consolidated financial statements.

Recent Accounting Pronouncements

Recently Issued Accounting Standards Not Yet Adopted

In June 2022, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No.

2022-03 “Fair Value Measurements (Topic 820):

Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions.” (“ASU 2022-03”).

ASU 2022-03 clarifies the guidance for measuring the fair value of an equity security subject to contractual restrictions that prohibit the sale of an equity security and introduces new disclosure requirements for equity securities subject to contractual sale restrictions that are measured at fair value in accordance with Topic 820.

ASU 2022-03 is effective for public business entities for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2023.

Early adoption is permitted.

The Company does not expect ASU 2022-03 to have a material impact on its financial position, results of operations, or cash flows.

Recently Issued Accounting Standards Adopted

In August 2020, the FASB issued ASU No.

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As a result, entities will no longer present embedded conversion features separately in equity;

rather, the convertible debt instrument will be accounted for as a single liability measured at its amortized cost.

instead, the convertible debt instrument will be accounted for as a single liability measured at its amortized cost.

ASU 2020-06 also addresses the computation of earnings per share for convertible debt instruments, requiring the application of the if-converted method when calculating diluted earnings per share.

The Company intends to adopt ASU 2020-06 during the first quarter of 2022, using the “modified retrospective” transition method.

The Company expects that its adoption of ASU 2020-06 will impact the accounting for its senior convertible notes (see Note 9) and will lead to a decrease in its opening shareholders’ equity of approximately $ 2.5 million, with a corresponding increase in the carrying value of the senior convertible notes.

The Company expects that in the periods in which the Company reports a net income, the number of shares outstanding for the diluted earnings per share calculation will be approximately 5.8 million higher under the if-converted method.

The Company does not expect the adoption of ASU 2020-06 to have a material impact on net income, cash flows, or any other balances.

Under the if-converted method, the shares potentially issuable in connection with convertible debt are assumed to be converted at the beginning of the period.

The resulting ordinary shares are included in the denominator of the diluted earnings per share calculation for the period presented.

The Company adopted ASU 2020-06 during the first quarter of 2022, using the “modified retrospective” transition method.

The adoption of ASU 2020-06 resulted in a decrease in the Company’s opening shareholders’ equity of approximately $ 2.5 million, with a corresponding increase in the carrying value of the senior convertible notes (see Note 9).

The adoption of ASU 2020-06 did not have a material impact on the Company’s net income, cash flows, or any other balances.

INVESTMENT IN RELATED PARTY INVESTMENT FUND

On September 1, 2018, the Company entered into an amended and restated exempted limited partnership agreement (as amended by the letter agreement dated as of August 5, 2020 (the “Previous SILP LPA”) of Solasglas Investments, LP (“SILP”), with DME Advisors II, LLC (“DME II”), as General Partner, Greenlight Re, and GRIL, (together the “GLRE Limited Partners”), and the initial limited partner (each, a “Partner”).

On September 1, 2018, SILP also entered into a SILP investment advisory agreement (“IAA”) with DME Advisors.

The Company has entered into the Second Amended and Restated Exempted Limited Partnership Agreement (the “SILP LPA”) of Solasglas Investments, LP (“SILP”), with DME Advisors II, LLC (“DME II”), as General Partner, Greenlight Re, and GRIL, (together, the “GLRE Limited Partners”).

SILP has entered into a SILP investment advisory agreement (“IAA”) with DME Advisors.

LP (“DME Advisors”), pursuant to which DME Advisors is the investment manager for SILP.

DME II and DME Advisors are related to the Company, and each is an affiliate of David Einhorn, Chairman of the Company’s Board of Directors.

On January 7, 2021, the Company and DME II entered into the Second Amended and Restated Exempted Limited Partnership Agreement, effective as of January 1, 2021 (the “SILP LPA”).

The SILP LPA amends, restates, supersedes, and incorporates all material terms of the Previous SILP LPA, as amended as of February 26, 2019, and the letter agreements dated June 18, 2019, December 27, 2019, and August 5, 2020 (collectively, the “Amendments”).

The SILP LPA also amended the definition of “Additional Investment Ratio” and each of the defined terms “Greenlight Re Surplus” and “GRIL Surplus” to clarify that each of the respectively referenced “financial statements” are “U.S.

GAAP financial statements.” In addition, the SILP LPA included the following proviso:

“The Investment Portfolio of each Partner will not exceed the product of (a) such Partner’s surplus (Greenlight Re Surplus or GRIL Surplus, as the case may be) multiplied by (b) the Investment Cap (50%), and the General Partner will designate any portion of a Partner’s Investment Portfolio as Designated Securities to effectuate such limit”.

The SILP LPA also amended the investment guidelines to reflect the amended investment guidelines adopted by the Company’s Board of Directors effective as of January 1, 2021.

DME II and DME Advisors are related to the Company, and each is an affiliate of David Einhorn, Chairman of the Company’s Board of Directors (the “Chairman”).

At December 31, 2022, the SILP LPA included the following proviso:

“The Investment Portfolio of each Partner will not exceed the product of (a) such Partner’s surplus (Greenlight Re Surplus or GRIL Surplus, as the case may be) multiplied by (b) the Investment Cap ( 50 %), and the General Partner will designate any portion of a Partner’s Investment Portfolio as Designated Securities to effectuate such limit.” Effective January 1, 2023, the Investment Cap was amended to 60 %.

The Company has concluded that SILP qualifies as a variable interest entity (“VIE”) under U.S.

In assessing its interest in SILP, the Company noted the following:

• DME II serves as SILP’s general partner and has the power of appointing the investment manager.

• DME II serves as SILP’s general partner and has the power to appoint the investment manager.

The Company does not have the power to appoint, change or replace the investment manager or the general partner except “for cause.” Neither of the GLRE Limited Partners can participate in the investment decisions of SILP as long as SILP adheres to the investment guidelines provided within the SILP LPA.

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Consequently, the Company has concluded that DME II’s interests, not the Company’s, meet both the “power” and “benefits” criteria associated with VIE accounting guidance, and therefore DME II is SILP’s primary beneficiary.

Consequently, the Company has concluded that DME II’s interests, not the Company’s, meet both the “power” and “benefits” criteria associated with VIE accounting guidance.

Therefore DME II is SILP’s primary beneficiary.

The Company presents its investment in SILP in its consolidated balance sheets in the caption “Investment in related party investment fund.”

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The investment in SILP is recorded at the GLRE Limited Partners’ share of the net asset value of SILP as reported by SILP’s third-party administrator.

The GLRE Limited Partners can redeem their assets from SILP for operational purposes by providing three business days’ notice to DME II.

The GLRE Limited Partners can redeem their assets from SILP for operational purposes by providing 3 business days’ notice to DME II.

At December 31, 2022, the majority of SILP’s long investments were composed of cash and publicly-traded equity securities, which could be readily liquidated to meet the GLRE Limited Partners’ redemption requests.

The Company’s share of the change in the net asset value of SILP for the years ended December 31, 2022, 2021, and 2020, was $ 54.8 million, $ 18.1 million, and $ 4.4 million, respectively, and shown in the caption “Income (loss) from investment in related party investment fund” in the Company’s consolidated statements of operations.

The change in the net asset value of SILP for the year ended December 31, 2021, was primarily driven by withdrawals made by the GLRE Limited Partners for paying claims and posting collateral to reinsurance clients.

At December 31, 2021, the Company’s investments in SILP was in excess of 10 % of the Company’s total shareholders’ equity, with a fair value of $ 183.6 million (December 31, 2020:

At December 31, 2022, the Company’s investments in SILP exceeded 10 % of the Company’s total shareholders’ equity, with a fair value of $ 178.2 million (December 31, 2021:

$ 183.6 million), representing 35.4 % (December 31, 2021:

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The summarized financial statements of SILP are presented below.

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Summarized Statement of Assets and Liabilities of Solasglas Investments, LP

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Derivative contracts, at fair value ( 12,443 ) ( 7,253 )

Capital withdrawals payable ( 10,000 ) —

Due to brokers ( 2,050 ) —

Capital withdrawals payable ( 75 ) ( 10,000 )

Interest and dividends payable ( 760 ) ( 580 )

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The Company’s “Other investments” are composed of the following:

• Private investments and unlisted equities, which consist primarily of Innovations-related investments supporting technology innovators in the (re)insurance market;

• Derivative financial instruments associated with the Company’s Innovations investments.

• Private investments, unlisted equities, and debt and convertible debt instruments, which consist primarily of Innovations-related investments supporting technology innovators in the (re)insurance market;

• Certificates of deposit with original maturities greater than three months.

At December 31, 2022, the Company included the following securities in the caption “Other investments”:

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Private investments and unlisted equities $ 22,787 $ 42,461 $ ( 2,815 ) $ 62,433

Derivative financial instruments (not designated as hedging instruments) — 335 — 335

Debt and convertible debt securities 1,846 — — 1,846

Certificates of deposit 6,000 — — 6,000

Total other investments $ 30,633 $ 42,461 $ ( 2,815 ) $ 70,279

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Derivative financial instruments (not designated as hedging instruments) — 335 — 335

Other investments 12,414 11,759 ( 1,300 ) 22,873

Investment accounted for under the equity method — — — 6,545

Total other investments $ 17,411 $ 31,773 $ ( 1,800 ) $ 47,384

At December 31, 2020, the investment accounted for under the equity method represented an investment in AccuRisk Holdings LLC (“AccuRisk”), a Chicago, Illinois-based managing general underwriter focused on employee and health insurance benefits.

During the year ended December 31, 2021, the Company sold its investment in AccuRisk and realized a pre-tax gain of $ 14.2 million, which was included in the caption “Net investment income (loss)” in the Company’s consolidated statements of operations.

The Company’s derivative financial instruments are composed of warrants granting the Company the right, but not the obligation, to purchase shares at a specified price on or before the maturity date.

At December 31, 2021, Company’s derivative financial instruments were composed of warrants granting the Company the right, but not the obligation, to purchase shares at a specified price on or before the maturity date.

The Company has not designated any of its derivative financial instruments as hedging instruments.

The Company’s maximum exposure to loss relating to these warrants is limited to the warrants’ carrying amount.

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Private investments and unlisted equity securities without readily determinable fair values

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• When the Company observes an orderly transaction of an investee’s identical or similar equity securities, the Company adjusts the carrying value based on the observable price as of the transaction date.

Once the Company records such an adjustment, the investment is considered an “asset measured at fair value on a nonrecurring basis.”

Once the Company

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records such an adjustment, the investment is considered an “asset measured at fair value on a nonrecurring basis.”

• If the Company determines that the investment is impaired and the fair value is less than its carrying value, it writes down the investment to its fair value.

Once the Company records such an adjustment, the investment is considered an “asset measured at fair value on a nonrecurring basis.”

The following table presents the carrying values of the private investments and unlisted equity securities carried under the measurement alternative at December 31, 2022, 2021, and 2020, and the related adjustments recorded during the years then ended.

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(1) The period-end carrying values reflect cumulative purchases and sales in addition to upward and downward carrying value changes.

(2) The cumulative upward carrying value changes from inception to December 31, 2021, were $ 31.6 million.

(3) The cumulative downward carrying value changes and impairments from inception to December 31, 2021, were $ 2.0 million.

(2) The cumulative upward carrying value changes from inception to December 31, 2022, totaled $ 42.9 million.

(3) The cumulative downward carrying value changes and impairments from inception to December 31, 2022, totaled $ 3.1 million.

Fair Value Hierarchy

The fair value of a financial instrument is the amount that would be received in an asset sale or paid to transfer a liability in an orderly transaction between unaffiliated market participants.

Assets and liabilities measured at fair value are categorized based on whether the inputs are observable in the market and the degree that the inputs are observable.

Assets and liabilities measured at fair value are categorized based on the extent to which the inputs are observable in the market.

The categorization of financial instruments within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement.

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Assets measured at fair value on a nonrecurring basis

At December 31, 2021, and 2020, the Company held $ 40.5 million and $ 16.5 million, respectively, of private investments and unlisted equities measured at fair value on a nonrecurring basis.

The Company classifies these assets as Level 3 within the fair value hierarchy due to their illiquidity.

Derivative instruments

The Company values its derivative instruments using the Black-Scholes option pricing model based on Level 3 inputs.

The Company uses the carrying value of the underlying stock as an input in the option pricing model.

The underlying stock does not have a readily determinable fair value.

Its carrying value is determined based on its original cost minus impairment, if any, plus or minus changes resulting from observable price changes.

The other assumptions applied to the option pricing model

At December 31, 2022, and December 31, 2021, the Company held $ 53.6 million and $ 40.5 million, respectively, of private investments and unlisted equities measured at fair value on a nonrecurring basis.

The Company classifies these assets as Level 3 within the fair value hierarchy.

The following table summarizes the periods between the most recent fair value measurement dates and December 31, 2022, for the private and unlisted equities measured at fair value on a nonrecurring basis:

Less than 6 months 6 to 12 months Over 1 year Total

($ in thousands)

Fair values measured on a nonrecurring basis $ 599 $ 33,028 $ 19,929 $ 53,556

At December 31, 2022, and December 31, 2021, the Company held $ 8.9 million and $ 6.5 million, respectively, of private investments and unlisted equities measured at cost.

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include a risk-free rate of 0.50 % and estimated volatility of 50 %.

The carrying value of the derivative instruments represents the fair value.

For the derivative instruments valued on the basis of Level 3 inputs, the Company includes any change in unrealized gains or losses in the caption “Net investment income (loss)” in the consolidated statements of operations.

At December 31, 2021, and 2020, the Company did not carry any other investments at fair value with an assigned Level within the fair value hierarchy.

Assets measured at fair value on a recurring basis

In accordance with ASC 320, “Investments - Debt Securities,” the Company has classified debt and convertible debt securities as “trading” measured at estimated fair value with unrealized gains and losses reported in net income.

The Company classifies these securities as Level 3 within the fair value hierarchy.

It estimates their fair values primarily based on third-party quotes, issuers’ book value, market multiples, and other inputs.

Valuation of these securities is subjective as the markets’ illiquidity may increase the likelihood that the estimated fair value of an investment is not reflective of the price at which an actual transaction could occur.

The carrying value of certificates of deposit with original maturities of one year or less approximates their fair values.

The Company classifies these assets as Level 2 within the fair value hierarchy.

At December 31, 2022, and December 31, 2021, the Company did not carry any other investments at fair value with an assigned Level within the fair value hierarchy.

The Company’s investment in the related party investment fund is measured at fair value using the net asset value practical expedient.

It is therefore not classified within the fair value hierarchy.

Therefore, this investment is not classified within the fair value hierarchy.

(See Note 3 for further details on the related party investment fund.)

During the year ended December 31, 2022, and 2021, there were no transfers between Level 2 and Level 3 of the fair value hierarchy.

Financial Instruments Disclosed, But Not Carried, at Fair Value

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Cash at banks includes cash held at non-U.S.

financial institutions which are not insured by the FDIC or other deposit insurance programs.

financial institutions not insured by the Federal Deposit Insurance Corporation or other deposit insurance programs.

RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS

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At December 31, 2022, the Company’s loss and loss adjustment expense reserves included estimated amounts for several catastrophe events.

For significant catastrophe events including, but not limited to, hurricanes, tornados, typhoons, floods, earthquakes, wildfires, and pandemics, loss reserves are generally established based on loss payments and case reserves reported by clients when, and if, received.

To establish IBNR loss estimates, the Company makes use of, among other things, the following:

For significant catastrophe events, including, but not limited to, hurricanes, tornados, typhoons, floods, earthquakes, wildfires, war and pandemics, loss reserves are generally established based on loss payments and case reserves reported by clients when received.

To establish IBNR loss estimates, the Company makes use of, among other things, the following information:

• estimates communicated by ceding companies;

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• an understanding of the underlying business written and its exposures to catastrophe event-related losses;

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• industry data;

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• management’s judgment.

The COVID-19 pandemic is unprecedented, and the Company does not have previous loss experience on which to base the associated estimate for loss and loss adjustment expenses.

The Company based its estimate on the following:

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At December 31, 2022, the Company’s loss and loss adjustment expense reserves included $ 13.6 million from the Russian-Ukrainian conflict and $ 19.5 million from Hurricane Ian.

Additional information the Company considered in estimating its loss reserves included the following:

• a review of in-force treaties that may provide coverage and incur losses;

• catastrophe and scenario modeling analyses and results shared by cedents;

• preliminary loss estimates received from clients and their analysts and loss adjusters;

• preliminary loss estimates received from clients, brokers, and loss adjusters;

• reviews of industry insured loss estimates and market share analyses;

• management’s judgment.

Significant assumptions which served as the basis for the Company's estimates of reserves for the COVID-19 pandemic losses and loss adjustment expenses include:

• the scope of coverage provided by the underlying policies, particularly those that provide for business interruption coverage;

• the regulatory, legislative, and judicial actions that could influence contract interpretations across the insurance industry;

• the extent of economic contraction caused by the COVID-19 pandemic and associated measures, particularly in the United States;

The Company’s Russian-Ukrainian conflict loss estimates include actuarial assumptions, including:

• the areas within the affected regions that have incurred losses;

• the scope of coverage provided by the underlying policies;

• the interpretation of contract terms;

• the determination of loss-triggering events;

• regulatory, legislative, and judicial actions that could influence contract interpretations across the insurance industry;

• the ability of the cedents and insured to mitigate some or all of their losses.

While the Company believes its estimate of loss and loss adjustment expense reserves for the COVID-19 pandemic is adequate as of December 31, 2021, based on available information, actual losses may ultimately differ materially from the Company's current estimates.

The Company will continue to monitor the appropriateness of its assumptions as new information becomes available and will adjust its estimates accordingly.

Due to the uncertainty associated with the foregoing assumptions, the Company’s loss estimates are subject to significant variability, and actual losses may ultimately differ materially from the Company's current estimates.

The Company will evaluate its assumptions as new information becomes available and may adjust its loss estimates in future periods.

Such adjustments may be material to the Company's results of operations and financial condition.

The Company made no significant changes in the actuarial methodology or reserving process related to its loss and loss adjustment expense reserves for the years ended December 31, 2021, and 2020.

Additionally, if the Russian-Ukrainian conflict is prolonged, the Company may incur additional losses in subsequent periods.

At December 31, 2022 and 2021, loss and loss adjustment expense reserves were composed of the following:

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Year ended December 31, 2022

During the year ended December 31, 2022, the Company experienced $ 0.1 million in net adverse development on prior year loss and LAE reserves.

This net adverse development resulted primarily from the following:

• $ 8.1 million of adverse development on motor and health business attributed to inflation-driven increases in claims costs;

• $ 7.1 million of adverse development on multi-line business driven by worse than expected claims experience on whole account contracts written from 2014-2018;

• $ 3.7 million of adverse development on professional liability contracts written from 2014 to 2017;

• $ 3.0 million of adverse development on workers’ compensation contracts driven by poor claims experience across several states in the U.S.;

• $ 2.0 million of adverse development on general liability contracts due to reported claims being settled above expected levels.

The adverse developments were partially offset by favorable developments relating to prior accident years primarily due to the following:

• $ 9.8 million of favorable experience on mortgage business.

On a financial-impact basis, the favorable loss development on these contracts was offset by increased profit commissions, which are included in the caption “Acquisition costs” in the Company’s consolidated statements of operations;

• $ 9.2 million of favorable development on multi-line business driven primarily by a loss portfolio transfer on a whole account contract and better than anticipated claims experience on a combined workers’ compensation and commercial packages account across multiple years;

• $ 7.2 million of loss reserves released relating to catastrophe events, COVID-19, and property covers based on updated claims reporting received from cedents.

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The remaining development on prior year loss and LAE reserves recognized in 2022 related to several smaller adjustments made across various lines of business.

Year ended December 31, 2021

During the year ended December 31, 2021, the Company experienced $ 14.1 million in net favorable development on prior year loss and LAE reserves.

This net favorable development resulted primarily from the following:

Favorable developments:

• $ 14.7 million of favorable loss development on motor contracts, primarily relating to contracts that incepted in 2015 and 2016 resulting from better than expected reported claims.

• $ 14.7 million of better-than-expected claims reporting on motor contracts, primarily relating to contracts that incepted in 2015 and 2016;

• $ 8.9 million favorable loss development on various specialty lines of business, including crop, space, and marine and energy, as actual losses reported were better than expected;

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• $ 3.5 million favorable loss development on a multi-line contract that incepted in 2019.

Adverse developments:

• $ 14.4 million of adverse development on multi-line casualty contracts primarily relating to contracts that incepted in 2014 to 2015 resulting from unfavorable development in reported claims.

The favorable developments were partially offset by adverse developments relating to prior accident years primarily due to the following:

• $ 14.4 million of adverse development on multi-line casualty contracts primarily relating to contracts that incepted in 2014 and 2015, resulting from unfavorable development in reported claims;

• $ 2.9 million of adverse development on a general liability contract resulting from unfavorable development in reported claims;

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This net adverse development resulted primarily from the following:

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Adverse developments:

• $ 7.6 million of adverse loss development on multi-line contracts that incepted from 2015 to 2018, resulting from unfavorable development in reported claims;

• $ 1.9 million of adverse loss development on general liability contracts, primarily relating to a contract that incepted in 2017 resulting from unfavorable development in reported claims.

• $ 1.9 million of adverse loss development on general liability contracts, primarily relating to unfavorable development in reported claims on a contract that incepted in 2019;

• $ 1.9 million of adverse loss development on specialty health contracts primarily arising from a few large medical claims reported on a contract that incepted in 2019;

• $ 1.5 million of adverse loss development on motor contracts relating to the 2018 and 2019 treaty years, partially offset by favorable loss development on contracts that incepted from 2015 to 2017.

Favorable developments:

• $ 4.5 million of favorable development on prior year property contracts primarily resulting from lower than anticipated losses relating to the 2017 and 2018 catastrophe events, partially offset by adverse loss development on 2019 contracts.

The adverse developments were partially offset by favorable developments relating to prior accident years primarily due to the following:

• $ 4.5 million of favorable development on property contracts primarily resulting from lower than anticipated losses relating to the 2017 and 2018 catastrophe events, partially offset by adverse loss development on 2019 contracts;

• $ 2.2 million of favorable loss development on solicitors’ professional indemnity contracts resulting primarily from lower than expected claims on prior accident years.

• $ 1.9 million of favorable loss development on a professional liability contract relating to a contract that incepted in 2008 where the reported claims have been lower than those previously anticipated.

The remaining development on prior year loss and LAE reserves recognized in 2020 related to several smaller adjustments made across various lines of business.

Year ended December 31, 2019

During the year ended December 31, 2019, the Company experienced $ 31.3 million in net adverse development on prior year loss and LAE reserves.

This net adverse development resulted primarily from the following:

Adverse developments:

• $ 39.8 million of adverse loss development on non-standard automobile contracts.

These unanticipated automobile losses were the result of adverse rulings that affected a significant number of loss events that occurred in Florida between 2015 and early 2018, including many claims that had previously been considered closed;

• $ 3.6 million of adverse loss development on specialty health contracts arising from an unexpectedly high frequency of medical claims reported.

Favorable developments:

• $ 13.5 million of favorable development on prior year property and multi-line contracts primarily resulting from lower than anticipated losses relating to California wildfires.

The remaining net favorable development on prior year loss and LAE reserves recognized in 2019 related to several smaller adjustments made across various lines of business.

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The remaining development on prior year loss and LAE reserves recognized in 2020 related to several smaller adjustments made across various lines of business.

The changes in the outstanding loss and loss adjustment expense reserves for health claims for the years ended December 31, 2022, 2021, and 2020 are as follows:

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The Company’s loss development tables presented below have been disaggregated by lines of business for the years ended from December 31, 2013, through 2022.

For purposes of the loss development tables, the property business has been further disaggregated into "Property" and "Motor - Physical Damage." The casualty category has been disaggregated into "General Liability," "Motor Liability," "Professional Liability," and "Workers' Compensation." In addition, the incurred and paid claims relating to accident and health business have been presented separately as "Health." Other specialty business, including financial, aviation, crop, cyber, energy, and marine, which are individually insignificant to our overall business, have been grouped as "Other." Contracts that cover more than one line of business, including Lloyd’s business, are grouped as "Multi-line."

For purposes of the loss development tables, the property business has been further disaggregated into "Property" and "Motor - Physical Damage." The casualty category has been disaggregated into "General Liability," "Motor Liability," "Professional Liability," and "Workers' Compensation." Contracts that cover more than one line of business, including Lloyd’s business, are grouped as "Multi-line." In addition, the incurred and paid claims relating to accident and health business have been presented separately as "Health." Other specialty business, including aviation, crop, cyber, energy, and marine, which are individually insignificant to our overall business, have been grouped as "Other." As the Company’s financial lines business has grown recently, the Company has elected to present the loss development table for financial business separately.

During 2022, the Company revised its line-of-business allocation for certain contracts and disaggregated the “Financial” line from the “Other” loss development table.

As a result, the historical incurred and paid claims development presented in the tables below differ from those disclosed in previously issued financial statements.

Conforming changes were also made to the table above presenting t he changes in the outstanding loss and loss adjustment expense reserves for health claims for the years ended December 31, 2021, and 2020.

The amounts shown in the caption “Net loss and loss adjustment expenses incurred” in the Company’s Consolidated Statements of Operations and the allocation between “Current year” and “Prior years” are unaffected by these revisions.

For each category, the following tables present the incurred and paid claims development at December 31, 2022, net of retrocession, and the total of incurred but not reported liabilities plus expected development on reported claims included within the net incurred claims amount.

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2021 4,953 13,194

Total 304,561

All outstanding liabilities before 2013, net of reinsurance ( 42 )

Liabilities for claims and claims adjustment expenses, net of reinsurance (Other) $ 78,867

Liabilities for claims and claims adjustment expenses, net of reinsurance (Property) $ 50,648

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Professional Liability

Incurred claims and allocated claim adjustment expenses, net of reinsurance December 31, 2022

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2021 158 165 165

Total $ 92,954 $ 13,419

Professional Liability

Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance

For the years ended December 31,

Accident year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

(Unaudited - Supplementary Information)

($ in thousands)

2013 $ 649 $ 3,180 $ 7,097 $ 10,207 $ 12,871 $ 13,575 $ 13,404 $ 14,795 $ 14,726 $ 14,935

2014 1,251 4,969 8,874 12,945 15,023 15,032 18,336 18,300 18,852

2015 1,084 3,065 8,343 11,113 11,937 16,452 17,915 18,903

2016 325 2,079 4,687 7,552 10,191 11,287 13,315

2017 222 1,418 3,062 4,821 5,783 8,297

2018 240 1,139 1,979 3,229 4,574

2019 145 266 544 658

All outstanding liabilities before 2013, net of reinsurance 425

Liabilities for claims and claims adjustment expenses, net of reinsurance (Professional Liability) $ 13,844

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Workers' Compensation

Incurred claims and allocated claim adjustment expenses, net of reinsurance December 31, 2022

For the years ended December 31, Total IBNR plus expected development on reported claims

Accident year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

(Unaudited - Supplementary Information)

($ in thousands)

2013 $ 4,751 $ 4,751 $ 4,751 $ 4,751 $ 4,751 $ 4,751 $ 4,751 $ 4,751 $ 4,751 $ 4,751 $ —

2014 — — — 3 — — — 160 — —

2015 1,014 1,010 948 950 951 919 919 889 20

2016 4,342 4,275 4,266 3,975 3,778 3,716 3,646 81

2017 10,879 10,343 9,600 9,060 8,756 8,977 426

2018 13,595 13,485 13,039 12,544 12,909 800

2019 22,926 23,311 22,612 23,955 3,808

2020 44,845 40,826 43,633 11,525

2021 64,679 63,398 20,544

2022 33,284 24,219

Total $ 195,443 $ 61,421

Workers' Compensation

Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance

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All outstanding liabilities before 2013, net of reinsurance —

Liabilities for claims and claims adjustment expenses, net of reinsurance (Property) $ 63,468

Liabilities for claims and claims adjustment expenses, net of reinsurance (Workers' Compensation) $ 61,421

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Professional Liability

Financial Lines

Incurred claims and allocated claim adjustment expenses, net of reinsurance December 31, 2022

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Total $ 89,198 $ 49,534

Professional Liability

Financial Lines

Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance

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2020 2,705 5,017 9,125

2021 500 2,196

All outstanding liabilities before 2013, net of reinsurance 9

Liabilities for claims and claims adjustment expenses, net of reinsurance (Professional Liability) $ 20,759

Liabilities for claims and claims adjustment expenses, net of reinsurance (Other) $ 49,543

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Workers' Compensation

Incurred claims and allocated claim adjustment expenses, net of reinsurance December 31, 2022

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Total $ 103,336 $ 64,013

Workers' Compensation

Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance

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2021 8,838 11,248

Total 105,927

All outstanding liabilities before 2013, net of reinsurance —

Liabilities for claims and claims adjustment expenses, net of reinsurance (Workers' Compensation) $ 65,483

For any incurred and paid claims denominated in a currency other than U.S.

Liabilities for claims and claims adjustment expenses, net of reinsurance (Other) $ 64,013

For incurred and paid claims denominated in currencies other than U.S.

dollars, the above tables are presented using the foreign exchange rate in effect at the current year-end date.

As a result, all prior year information has been restated to reflect the exchange rates at December 31, 2021.

As a result, all prior year information has been restated to reflect December 31, 2022, foreign exchange rates.

This treatment prevents changes in foreign currency exchange rates from distorting the claims development between the years presented.

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Some incurred and paid claims have been allocated to the accident years for the loss development tables based on the proportion of premiums earned for each contract during such accident year.

For example, a one-year treaty incepting on October 1, 2018 (with underlying policies each having a one-year duration) would have a 24-month period over which the premiums would be earned.

For example, a one-year quota-share reinsurance treaty incepting on October 1, 2020 (with underlying policies each having a one-year duration) would have a 24-month period over which the premiums would be earned.

Therefore, claims would be allocated to accident years 2020, 2021 and 2022 based on the proportion of the premiums earned during each accident year.

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Workers' Compensation 61,421

Financial Lines 49,543

Liabilities for claims and claims adjustment expenses, net of reinsurance 537,735

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Motor Property 53.3 % 40.8 % 4.9 % 1.0 % — % — % — % — % — % — %

Other 33.5 % 44.6 % 15.5 % 3.0 % 2.0 % 1.0 % 0.4 % — % — % — %

Property 49.5 % 34.7 % 8.0 % 2.9 % 2.5 % 0.8 % 1.0 % 0.5 % 0.1 % — %

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Workers' Compensation 30.9 % 36.5 % 22.4 % 7.6 % 1.6 % 0.8 % 0.1 % 0.1 % — % — %

Financial Lines 20.9 % 34.3 % 21.2 % 11.3 % 4.5 % 3.7 % 1.8 % 1.0 % — % 1.3 %

Other 20.6 % 27.2 % 11.2 % 10.0 % 8.3 % 7.7 % 7.6 % 7.4 % — % — %

The historical annual percentage payout pattern for health claims is excluded from the table above because health claims have short settlement periods, and including it would skew the results presented.

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The Company records loss and loss adjustment expenses recoverable from retrocessionaires as assets.

For the year ended December 31, 2021, the Company’s earned ceded premiums were insignificant (2020:

For the year ended December 31, 2022, the Company’s earned ceded premiums were $ 15.3 million (2021:

$ 0.0 million and 2020:

$ 3.2 million).

For the year ended December 31, 2021, loss and loss adjustment expenses recovered and change in losses recoverable were insignificant (2020:

For the year ended December 31, 2022, loss and loss adjustment expenses recovered and changes in losses recoverable were $ 6.6 million (2021:

$ 0.0 million and 2020:

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On August 7, 2018, the Company issued $ 100.0 million of senior unsecured convertible notes (the “Notes”), which mature on August 1, 2023.

The Notes bear interest at 4 %, payable semi-annually on February 1 and August 1 of each year beginning February 1, 2019.

The Notes bear interest at 4.0 %, payable semiannually on February 1 and August 1 of each year beginning February 1, 2019.

Noteholders have the option, under certain conditions, to redeem the Notes prior to maturity.

At December 31, 2022, the Company’s share price was lower than the conversion price of $ 17.19 per share.

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Note holders have the option, under certain conditions, to redeem the Notes prior to maturity.

If a holder redeems the Notes, the Company shall have the option to settle the conversion obligation in cash, ordinary shares of the Company, or a combination thereof pursuant to the terms of the indenture governing the Notes.

The Company has therefore bifurcated the Notes into liability and equity components.

At December 31, 2021, the Company’s share price was lower than the conversion price of $ 17.19 per share.

The Company’s effective borrowing rate for non-convertible debt at the time of issuance of the Notes was estimated to be 6.0 %, which equated to an $ 8.2 million discount.

At December 31, 2021, and 2020, the unamortized debt discount was $ 2.6 million and $ 4.2 million, respectively.

The debt discount also represents the portion of the Note’s principal amount allocated to the equity component.

Prior to January 1, 2022, the Company bifurcated the Notes into liability and equity components.

Effective January 1, 2022, upon adoption of ASU 2020-06, the Company no longer bifurcates the Notes and presents the entire balance as a single liability on the Company’s consolidated balance sheets (see Note 2 for recently issued accounting standards adopted).

The Company’s effective borrowing rate for non-convertible debt at the time of issuance of the Notes was estimated to be 6.0 %.

The Company incurred issuance costs in connection with the issuance of the Notes.

At December 31, 2021, the unamortized portion of these costs attributed to the debt component was $ 1.0 million (December 31, 2020:

At December 31, 2022, the unamortized portion of these costs was $ 0.4 million (December 31, 2021:

$ 1.0 million), which the Company expects to amortize through the maturity date.

The Company netted the portion of these issuance costs attributed to the equity component against the gross proceeds allocated to equity, resulting in the Company including $ 7.9 million in the caption “Additional paid-in capital” in the Company’s consolidated balance sheets.

The carrying value of the Notes at December 31, 2021, including accrued interest of $ 1.7 million, was $ 98.1 million (December 31, 2020:

During the year ended December 31, 2022, the Company repurchased and canceled $ 20.4 million of the Notes.

The carrying value of the Notes outstanding at December 31, 2022, including accrued interest of $ 1.3 million, was $ 80.5 million (December 31, 2021:

$ 98.1 million).

At December 31, 2021, the Company estimated the fair value of the Notes to be $ 97.5 million (December 31, 2020:

At December 31, 2022, the Company estimated the fair value of the Notes (excluding accrued interest) to be $ 77.1 million (December 31, 2021:

$ 97.5 million) (see Note 4 Financial Instruments).

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$ 6.3 million;

$ 6.3 million) in connection with the interest coupon, amortization of issuance costs, and amortization of the discount.

The Company was in compliance with all covenants relating to the Notes at December 31, 2021, and 2020.

At December 31, 2021, the Company had a remaining obligation for interest and principal payments of $ 4.0 million and $ 104.0 million during 2022 and 2023, respectively.

$ 6.3 million), which included the interest coupon and the amortization of issuance costs.

The comparative amounts for 2021 and 2020 also included the amortization of the discount.

The Company was in compliance with all covenants relating to the Notes at December 31, 2022, and December 31, 2021.

At December 31, 2022, the Company had a remaining obligation for interest and principal payments of $ 82.8 million during 2023.

Subsequent to December 31, 2022, the Company repurchased and canceled $ 13.8 million of the Notes.

SHARE CAPITAL

The holders of all ordinary shares are entitled to share equally in dividends declared by the Board of Directors.

In the event of a winding-up or dissolution of the Company, the ordinary shareholders share equally and ratably in the assets of the Company, after payment of all debts and liabilities of the Company and after the liquidation of any issued and outstanding preferred shares.

In the event of a winding-up or dissolution of the Company, the ordinary shareholders share equally and ratably in the Company’s assets after payment of all debts and liabilities and after the liquidation of any issued and outstanding preferred shares.

The Board of Directors is authorized to establish the rights and restrictions for preferred shares as they deem appropriate.

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The Third Amended and Restated Memorandum and Articles of Association, as revised by special resolution on July 10, 2008 (the “Articles”), provide that the holders of Class A ordinary shares generally are entitled to one vote per share.

However, except upon unanimous consent of the Board of Directors, no Class A shareholder is permitted to vote a number of shares which would cause any United States person to own (directly, indirectly, or constructively under applicable United States tax attribution and constructive ownership rules) 9.9 % or more of the total voting power of all issued and outstanding ordinary shares.

However, except upon unanimous consent of the Board of Directors, no Class A shareholder is permitted to vote a number of shares that would cause any United States person to own (directly, indirectly, or constructively under applicable United States tax attribution and constructive ownership rules) 9.9 % or more of the total voting power of all issued and outstanding ordinary shares.

The Articles further provide that the holders of Class B ordinary shares generally are entitled to ten votes per share.

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At December 31, 2022, the Company has an effective Form S-3 registration statement on file with the SEC for an aggregate principal amount of $ 200.0 million in securities.

On October 29, 2020, the Company’s shareholders approved an amendment to the stock incentive plan to increase the number of Class A ordinary shares available for issuance by 3.0 million shares from 5.0 million to 8.0 million.

At December 31,

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2021, 3,128,276 (December 31, 2020:

Under the Company’s stock incentive plan, the number of Class A ordinary shares authorized for issuance is 8.0 million shares.

At December 31, 2022, 2,011,426 (December 31, 2021:

3,128,276 ) Class A ordinary shares remained available for future issuance under the Company’s stock incentive plan.

The Compensation Committee of the Board of Directors administers the stock incentive plan.

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The Board has adopted a share repurchase plan.

The timing of such repurchases and the actual number of shares repurchased will depend on various factors, including price, market conditions, and applicable regulatory and corporate requirements.

On March 26, 2020, the Board of Directors extended the share repurchase plan to June 30, 2021.

It increased the number of shares authorized to be repurchased to 5.0 million Class A ordinary shares or securities convertible into Class A ordinary shares in the open market, through privately negotiated transactions or Rule 10b5-1 stock trading plans.

In addition, the Board of Directors also authorized the Company to repurchase up to $ 25.0 million aggregate face amount of the Company’s 4.0 % Convertible Senior Notes due 2023 (the “Notes”) in privately negotiated transactions, in open market repurchases, or pursuant to one or more tender offers.

The Company did not repurchase any Notes under the repurchase plan.

On May 4, 2021, the Board of Directors approved a new share repurchase plan effective from July 1, 2021, until June 30, 2022, authorizing the Company to repurchase up to $ 25 million of Class A ordinary shares or securities convertible into Class A ordinary shares in the open market, through privately negotiated transactions or Rule 10b5-1 stock trading plans.

The Board of Directors has approved a share repurchase plan, which expires on June 30, 2023, authorizing the Company to repurchase up to $ 25.0 million of Class A ordinary shares or securities convertible into Class A ordinary shares in the open market through privately negotiated transactions or Rule 10b5-1 stock trading plans.

The Company is not required to repurchase any of the Class A ordinary shares.

The repurchase plan may be modified, suspended, or terminated at the election of our Board of Directors at any time without prior notice.

The Company repurchased 1,079,544 Class A ordinary shares during the year ended December 31, 2021 (2020:

The Company repurchased 4,933 Class A ordinary shares at an average price of $ 7.04 per share during the year ended December 31, 2022 (2021:

1,079,544 at an average price of $ 9.26 per share).

All Class A ordinary shares repurchased are canceled immediately upon repurchase.

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$ 222.6 million).

At December 31, 2021, Greenlight Re’s statutory capital and surplus of $ 503.9 million exceeded the MCR as well as the PCR.

At December 31, 2022, Greenlight Re’s statutory capital and surplus of $ 475.0 million exceeded the MCR and PCR.

For the years ended December 31, 2022, 2021, and 2020, Greenlight Re’s net income was $ 32.3 million, $ 15.9 million, and $ 12.6 million, respectively.

Greenlight Re is not required to prepare separate statutory financial statements for filing with CIMA.

There were no material differences between Greenlight Re’s GAAP capital, surplus, and net income and its statutory capital, surplus, and net income at December 31, 2021 and 2020.

There were no material differences between Greenlight Re’s GAAP capital, surplus, and net income and its statutory capital, surplus, and net income at December 31, 2022 and 2021, and for the years then ended.

At December 31, 2022, the Company was not restricted from payment of dividends to the Company’s shareholders.

However, since most of the Company’s capital and retained earnings are invested in its subsidiaries, a dividend from one or more of the Company’s subsidiaries would likely be required to fund a dividend to the Company’s shareholders.

Any dividends declared and paid from Greenlight Re to the Company would require approval of CIMA.

Any dividends declared and paid from Greenlight Re to the Company would require CIMA’s approval.

During the year ended December 31, 2022, $ 60.1 million of dividends (2021:

$ 4.0 million, 2020:

$ 3.9 million) were declared or paid by Greenlight Re to the Company, which the Company used to pay interest on the Notes.

$ 39.5 million) were declared or paid by Greenlight Re to the Company.

The dividends were approved by CIMA and resulted in the return of additional share capital to the Company.

The dividends were used primarily to repurchase the Company’s Notes and pay interest on them.

At December 31, 2022 and 2021, $ 248.5 million and $ 281.3 million, respectively, of Greenlight Re’s capital and surplus was available for distribution as dividends.

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GRIL is obligated to maintain a minimum level of statutory capital.

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At December 31, 2022 and 2021, none of GRIL’s capital and surplus was available for distribution as dividends.

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SHARE-BASED COMPENSATION

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Employee and Director Restricted Shares

The restricted shares issued to certain employees contain restrictions relating to vesting, forfeiture in the event of termination of employment, transferability, and other matters.

For the year ended December 31, 2022, the Company issued to non-employee directors an aggregate of 107,763 (2021:

74,769 , 2020:

71,330 ) restricted Class A ordinary shares as part of their remuneration for services to the Company.

These restricted shares contain similar restrictions to those issued to employees.

They will vest on the earlier of (i) the first anniversary of the date of the share issuance and (ii) the Company’s next annual general meeting, subject to the grantee’s continued service with the Company.

During the vesting period, non-employee directors holding these restricted shares retain voting rights and are entitled to any dividends declared by the Company.

For the year ended December 31, 2022, the Company issued 849,872 (2021:

1 unchanged sentence

306,264 ) Class A ordinary shares to employees pursuant to the Company’s stock incentive plan.

These shares contain certain restrictions relating to, among other things, vesting, forfeiture in the event of termination of employment and transferability.

The restricted shares cliff vest three years after the date of issuance, subject to the grantee’s continued service with the Company.

The restricted shares granted to employees in 2022 include (i) restricted shares with both performance and service-based vesting conditions (“Performance RSs”) and (ii) restricted shares with only service-based vesting conditions (“Service RSs”).

The Service RSs vest evenly each year on January 1, subject to the grantee’s continued service with the Company.

If performance goals are achieved, the Performance RSs will cliff vest at the end of a three-year performance period within a range of 25 % and 100 % of the awarded Performance RSs, with a target of 50 %.

During the vesting period, the holder of the Service RSs and Performance RSs retains voting rights but is entitled to any dividends declared by the Company only upon vesting.

Prior to fiscal year 2022, the restricted shares granted to employees cliff vested three years after the date of issuance, subject to the grantee’s continued service with the Company.

During the vesting period, the holder of the restricted shares retains voting rights and is entitled to any dividends declared by the Company.

For the year ended December 31, 2021, the Company also issued to non-employee directors an aggregate of 74,769 (2020:

71,330 , 2019:

77,556 ) restricted Class A ordinary shares as part of their remuneration for services to the Company.

Each of these restricted shares issued to non-employee directors contains similar restrictions to those issued to employees and will vest on the earlier of the first anniversary of the date of the share issuance or the Company’s next annual general meeting, subject to the grantee’s continued service with the Company.

For the year ended December 31, 2021, 20,592 (2020:

Prior to fiscal year 2021, the Company issued Class A ordinary shares to the Chief Executive Officer (“CEO”) pursuant to the Company’s stock incentive plan (“CEO RSs”).

These shares contain performance and service conditions and certain restrictions relating to, among other things, vesting, forfeiture in the event of termination of the CEO’s employment, and transferability.

The CEO RSs cliff vest five years after the date of issuance, subject to the performance condition being met and the CEO’s continued service with the Company.

At December 31, 2022, there were 193,149 non-vested CEO RSs with a weighted average grant date fair value of $ 10.10 per share.

As the performance conditions associated with these restricted shares have not been met, the Company recognized no compensation cost relating to the unvested CEO RSs for the years ended December 31, 2022, 2021, and 2020.

The Company recognizes compensation expense associated with Performance RSs and Service RSs based on the fair value of the Company's Class A ordinary shares measured at the grant date.

For Service RSs, the Company recognizes this expense on a straight-line basis over the requisite service period.

For Performance RSs, the Company recognizes the associated compensation expense based on achieving established performance criteria during the performance period.

For the year ended December 31, 2022, grantees forfeited 8,476 (2021:

20,592 , 2020:

37,502 ) restricted shares were forfeited by grantees due to vesting conditions not being met.

For the year ended December 31, 2021, the Company reversed $ 0.1 million of stock compensation expense (2020:

462,388 ) restricted shares.

For the year ended December 31, 2022, the Company reversed a nominal amount of stock compensation expense (2021:

$ 0.1 million, 2020:

$ 0.2 million) relating to the forfeited restricted shares.

$ 0.7 million) in relation to the forfeited restricted shares.

The Company recorded $ 3.8 million of share-based compensation expense, net of forfeiture reversals, relating to restricted shares for the year ended December 31, 2022 (2021:

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$ 2.7 million, 2020:

$ 2.7 million) of unrecognized compensation cost relating to non-vested restricted shares (excluding any restricted shares with performance conditions that the Company does not expect will be met).

The Company expects to recognize these costs over a weighted average period of 1.8 years (2020:

$ 1.9 million) of unrecognized compensation cost relating to non-vested restricted shares (excluding CEO RSs), which the Company expects to recognize over a weighted-average period of 1.4 years (2021:

1.8 years, 2020:

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$ 3.3 million).

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The following table summarizes the activity for unvested outstanding restricted share awards during the years ended December 31, 2022, and 2021:

Performance Restricted Shares Service Restricted Shares

shares Weighted

fair value Number of

shares Weighted

Balance at December 31, 2020 193,149 $ 10.10 504,400 $ 9.11

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Balance at December 31, 2022 794,362 $ 7.62 832,896 $ 7.76

Employee Restricted Stock Units

The Company issues RSUs to certain employees as part of the stock incentive plan.

Such RSUs contain restrictions relating to vesting, forfeiture in the event of termination of employment, transferability, and other matters.

On the vesting date, the Company converts each RSU into one Class A ordinary share and issues new Class A ordinary shares from the shares authorized for issuance as part of the Company’s stock incentive plan.

The RSUs granted to employees in 2022 include (i) RSUs with both performance and service-based vesting conditions (“Performance RSUs”) and (ii) RSUs with only service-based vesting conditions (“Service RSUs”).

The Service RSUs vest evenly each year on January 1, subject to the grantee’s continued service with the Company.

If performance goals are achieved, the Performance RSUs will cliff vest at the end of a three-year performance period within a range of 25 % and 100 % of the awarded Performance RSUs, with a target of 50 %.

The Company recognizes compensation expense associated with Performance RSUs and Service RSUs based on the fair value of the Company's Class A ordinary shares measured at the grant date.

For Service RSUs, the Company recognizes this expense on a straight-line basis over the requisite service period.

For Performance RSUs, the Company recognizes the associated compensation expense based on achieving established performance criteria during the performance period.

Prior to 2022, the RSUs issued to employees cliff vested three years after the date of issuance, subject to the grantee’s continued service with the Company.

For the year ended December 31, 2022, the Company issued 159,215 (2021:

58,123 , 2020:

60,622 ) RSUs to employees pursuant to the Company’s stock incentive plan.

For the year ended December 31, 2022, no RSUs were forfeited (2021:

The Company recorded $ 0.7 million of share-based compensation expense relating to RSUs for the year ended December 31, 2022 (2021:

$ 0.4 million, 2020:

$ 0.4 million).

At December 31, 2022, the total compensation cost related to non-vested RSUs not yet recognized was $ 0.6 million (2021:

$ 0.5 million), which the Company expects to recognize over a weighted-average period of 1.6 years (2021:

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Employee RSU activity during the years ended December 31, 2022, and 2021 was as follows:

Performance Restricted Stock Units Service Restricted Stock Units

RSUs Weighted

fair value Number of

RSUs Weighted

Balance at December 31, 2020 — $ — 116,722 $ 9.60

Granted — — 58,123 9.18

Vested — — ( 20,711 ) 15.90

Forfeited — — — —

Balance at December 31, 2021 — $ — 154,134 8.59

Granted 105,008 6.82 54,207 6.82

Vested — — ( 35,389 ) 10.84

Forfeited — — — —

Balance at December 31, 2022 105,008 $ 6.82 172,952 $ 7.58

Employee and Director Stock Options

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For the year ended December 31, 2022, 45,290 (2021:

40,000 ) stock options expired and 80,000 (2020:

100,000 ) Class A ordinary share purchase options expired, and 80,000 (2021:

80,000 ) stock options vested.

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80,000 , 2020:

80,000 ) options vested which had a weighted average grant date fair value of $ 9.60 (2020:

$ 9.60 , 2019:

Employee Restricted Stock Units

The Company issues RSUs to certain employees as part of the stock incentive plan.

These RSUs contain restrictions relating to vesting, forfeiture in the event of termination of employment, transferability, and other matters.

Each RSU grant cliff vests three years after the date of issuance, subject to the grantee’s continued service with the Company.

For the year ended December 31, 2021, the Company issued 58,123 (2020:

80,000 ) options vested.

They had a weighted average grant date fair value of $ 9.60 (2021:

$ 9.60 , 2020:

48,535 ) RSUs to employees pursuant to the Company’s stock incentive plan.

For the year ended December 31, 2021, no RSUs were forfeited (2020:

The Company recorded $ 0.4 million of share-based compensation expense relating to RSUs for the year ended December 31, 2021 (2020:

$ 0.4 million, 2019:

$ 0.2 million).

At December 31, 2021, the total compensation cost related to non-vested RSUs not yet recognized was $ 0.5 million (2020:

$ 0.4 million), which the Company expects to recognize over a weighted-average period of 1.8 years (2020:

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Employee RSU activity during the years ended December 31, 2021, and 2020 was as follows:

RSUs Weighted

Balance at December 31, 2019 63,582 $ 13.76

Granted 60,622 6.72

Vested ( 7,482 ) 21.65

Forfeited — —

Balance at December 31, 2020 116,722 9.60

Granted 58,123 9.18

Vested ( 20,711 ) 15.90

Forfeited — —

Balance at December 31, 2021 154,134 $ 8.59

Performance Restricted Shares

Prior to 2021, the Company issued Class A ordinary shares to the Chief Executive Officer (“CEO”) pursuant to the Company’s stock incentive plan.

These restricted shares cliff vest five years after the date of issuance, subject to the performance condition being met and the CEO’s continued service with the Company.

During the year ended December 31, 2020, the Company’s compensation committee accelerated the vesting of 72,545 shares that vested immediately.

The modification resulted in $ 0.5 million of incremental compensation cost during the year ended December 31, 2020.

As the performance conditions associated with these restricted shares have not been met, the Company recognized no compensation cost relating to the unvested shares for the year ended December 31, 2021, and 2020.

The performance restricted share activity during the years ended December 31, 2021, and 2020 was as follows:

performance restricted shares Weighted

Balance at December 31, 2019 356,900 $ 11.10

Granted 145,089 6.72

Vested ( 72,545 ) 6.72

Forfeited ( 236,295 ) 10.58

Balance at December 31, 2020 193,149 10.10

Forfeited — —

Balance at December 31, 2021 193,149 $ 10.10

Stock Compensation Expense

For the years ended December 31, 2022, 2021, and 2020, the combined stock compensation expense (net of forfeitures), which was included in the caption “General and administrative expenses” in the Company’s consolidated statements of operations, was $ 4.7 million, $ 3.2 million and $ 2.5 million, respectively.

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NET INVESTMENT INCOME (LOSS)

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($ in thousands)

Realized gains (losses) $ 14,210 $ ( 9,234 ) $ ( 14,150 )

Interest and dividend income, net of withholding taxes $ 10,865 $ 200 $ 5,419

Change in unrealized gains and losses 9,858 19,560 25,909

Investment-related foreign exchange gains (losses) ( 185 ) ( 45 ) 39

Interest and dividend income, net of withholding taxes 200 5,419 16,059

Interest, dividend, and other expenses ( 6,399 ) ( 1,860 ) ( 1,875 )

Realized gains (losses) — 14,210 ( 9,234 )

Income (loss) from equity method investment — — 843

3 unchanged sentences

“Income (loss) from investments in related party investment fund” reflects the equity in earnings (loss) of SILP (see Note 3).

For the year ended December 31, 2021, the Company realized a $ 14.2 million pre-tax gain on disposal of the AccuRisk investment (see Note 4).

"Change in unrealized gains and losses” for the year ended December 31, 2022, includes net unrealized gains of $ 9.9 million (2021:

1 unchanged sentence

$ 10.2 million) on Innovations-related investments.

For the year ended December 31, 2020, the change in unrealized gains and losses also included a net decrease in the valuation allowance of $ 15.0 million (2019:

net increase of $ 6.0 million) relating to notes receivable.

For the year ended December 31, 2021, the realized gains of $ 14.2 million related to the sale of a strategic investment.

Each of the Company and Greenlight Re intends to conduct all of its operations in a manner that will not cause it to be treated as engaging in a trade or business within the United States and will not cause it to be subject to current U.S.

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The net deferred tax asset is included in the caption “Other assets” in the Company’s consolidated balance sheets.

The Company has determined that it is more likely than not to fully realize the recorded deferred tax asset (net of the valuation allowance) in the future.

The Company based this determination on the expected timing of the reversal of the temporary differences and the likelihood of generating sufficient taxable income to realize the future tax benefit.

The Company has determined that it is more likely than not that it will fully realize the recorded deferred tax asset (net of the valuation allowance) in the future.

The Company has based this determination on the expected timing of the reversal of the temporary differences and the likelihood of generating sufficient taxable income to realize the future tax benefit.

At December 31, 2022, GRIL had a net operating loss carryforward of $ 20.4 million (2021:

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Current tax (expense) benefit $ ( 671 ) $ ( 3,997 ) $ ( 48 )

Tax recovered 1,487 — —

Deferred tax (expense) benefit ( 442 ) ( 3 ) 5

1 unchanged sentence

Income tax (expense) benefit $ 816 $ ( 3,746 ) $ ( 424 )

For the year ended December 31, 2021, the income tax expense of $ 3.7 million resulted from Verdant’s gain on the sale of its AccuRisk investment.

At December 31, 2021, Verdant had no net operating loss carryforward (2020:

$ 2.4 million).

Federal Excise Taxes

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Investment Advisory Agreement

DME, DME II, and DME Advisors are each an affiliate of David Einhorn, Chairman of the Company’s Board of Directors, and therefore, are related parties to the Company.

Each of DME, DME II, and DME Advisors is an affiliate of the Chairman and, therefore, is a related party to the Company.

The Company has entered into the SILP LPA (as described in Note 3 of the consolidated financial statements).

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$ 137.6 million) as collateral against the letters of credit issued and included in the caption “Restricted cash and cash equivalents” in the Company’s consolidated balance sheets.

The credit facility contains customary events of default and restrictive covenants, including but not limited to, limitations on liens on collateral, transactions with affiliates, mergers and sales of assets, as well as solvency and maintenance of certain minimum pledged equity requirements, and restricts issuance of any debt without the consent of the letter of credit provider.

The credit facility contains customary events of default and restrictive covenants, including but not limited to limitations on liens on collateral, transactions with affiliates, mergers, and sales of assets, as well as solvency and maintenance of certain minimum pledged equity requirements.

It also restricts the issuance of any debt without the consent of the letter of credit provider.

Additionally, if an event of default exists, as defined in the letter of credit facility, Greenlight Re will be prohibited from paying dividends to its parent company.

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The Company has determined that its lease agreements for office space qualify as operating lease arrangements.

At the commencement date, the Company determines the lease term by assuming the exercise of those renewal options deemed to be reasonably certain.

At the commencement date, the Company determined the lease term by assuming the exercise of those renewal options deemed reasonably certain.

The exercise of lease renewal options is at the Company's sole discretion, and these options do not contain any material residual value guarantees or material restrictive covenants.

The Company’s weighted-average remaining operating lease term is approximately 4.0 years at December 31, 2022.

As the lease contracts generally do not provide an implicit discount rate, the Company used the weighted-average discount rate of 6.0 %, representing its incremental borrowing rate based on information available at the commencement date, to

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determine the present value of lease payments.

The incremental borrowing rate is based on a borrowing with a term similar to that of the associated lease.

The Company has made an accounting policy election not to include renewal, termination, or purchase options that are not reasonably certain of exercise when determining the term of the borrowing.

As the lease contracts generally do not provide an implicit discount rate, the Company used the weighted-average discount rate of 6.0 % to determine the present value of lease payments.

This discount rate represents the Company’s incremental borrowing rate for a term similar to that of the associated lease based on information available at the commencement date, The Company has made an accounting policy election not to include renewal, termination, or purchase options that are not reasonably certain of exercise when determining the borrowing term.

At December 31, 2022, the right-of-use assets and lease liabilities relating to the operating leases were $ 1.9 million and $ 2.0 million, respectively (2021:

The operating and short-term lease expenses for the year ended December 31, 2021, were $ 0.4 million and $ 0.3 million, respectively (2020:

$ 0.2 million and $ 0.5 million).

$ 2.4 million and $ 2.5 million, respectively).

The operating expense for the year ended December 31, 2022, was $ 0.6 million (2021:

$ 0.4 million, 2020:

$ 0.2 million).

At December 31, 2022, the commitment for operating lease liabilities for future annual periods was as follows:

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While the Company cannot predict the outcome of legal disputes with certainty, the Company does not believe that any existing dispute, when finally resolved, will have a material adverse effect on the Company’s business, financial condition, or operating results.

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SEGMENT REPORTING

The Company has one operating segment, Property & Casualty Reinsurance.

Substantially all of the Company’s business is sourced through reinsurance brokers.

The following table sets forth the premiums generated through our largest brokers and their subsidiaries and affiliates (totals may not sum due to rounding):

Year ended December 31

2021 2020 2019

($ in thousands)

A significant portion of the Company’s business is sourced through reinsurance brokers.

The following table sets forth the brokers and their subsidiaries that generated more than 10% of our premiums for the years ended December 31, 2022, 2021 and 2020:

Year ended December 31, Broker ($ in thousands)

Aon Benfield $ 159,421 28.3 %

Gallagher Re 91,239 16.2 %

Guy Carpenter (Marsh) $ 178,336 31.5 %

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BMS Group 63,958 11.3 %

Total of largest brokers $ 381,338 67.4 % $ 336,965 70.2 % $ 423,544 80.7 %

All other brokers and direct placements 184,055 32.6 142,826 29.8 100,433 19.3

Total $ 565,393 100.0 % $ 479,791 100.0 % $ 523,977 100.0 %

Guy Carpenter (Marsh) $ 195,274 40.7 %

Trean Re 112,659 23.5 %

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Professional Liability 1,921 0.3 316 0.1 204 —

316 0.1 204 — ( 448 ) ( 0.1 )

Workers' Compensation 28,381 5.0 62,188 11.0 82,189 17.1

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$ 563,171 100.0 % $ 565,393 100.0 % $ 479,791 100.0 %

(1) The negative balance represents the reversal of premiums due to premium adjustments, termination of contracts, or premium returned upon novation or commutation of contracts.

Gross Premiums Written by Geographic Area of Risks Insured

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(1) “Worldwide” is composed of contracts that reinsure risks in more than one geographic area and may include risks in the U.S.

(2) The negative balances represent the reversal of premiums due to premium adjustments, termination of contracts, or premium returned upon novation or commutation of contracts.

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Private investments and unlisted equities $ 22,787 $ 62,433 $ 62,433

Derivative financial instruments (not designated as hedging instruments) — 335 335

Debt and convertible debt securities 1,846 1,846 1,846

Certificates of deposit 6,000 6,000 6,000

Total other investments 30,633 70,279 70,279

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Investment in subsidiaries 554,438 576,287

Notes receivable (net of allowance for expected credit losses) — 10,706

Due from subsidiaries 28,400 —

Other assets 753 —

Total assets $ 584,566 $ 576,772

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Net investment income $ 1 $ 22 $ 141

Other income (expense) 366 — —

Total revenues 367 22 141

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Consolidated net income (loss) $ 25,342 $ 17,578 $ 3,866

Comprehensive income (loss) $ 25,342 $ 17,578 $ 3,866

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11 unchanged sentences

Equity in earnings of consolidated subsidiaries ( 36,063 ) ( 28,082 ) ( 13,490 )

Net realized gain on repurchase of convertible senior notes payable ( 343 ) — —

Net change in unrealized gains and losses on investments — — —

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Due from subsidiaries ( 28,400 ) — 8,200

Other assets ( 753 ) — —

Other liabilities ( 69 ) 150 ( 1,611 )

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Financing activities

Repurchases of convertible senior notes payable ( 19,793 ) — —

Repurchase of Class A ordinary shares ( 35 ) ( 10,000 ) ( 17,781 )

33 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures