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We own and operate a group of specialty insurance and reinsurance companies.
−Removed: For the year ended December 31, 2021, approximately 70.4% of our group-wide gross written premiums originated from the U.S.
−Removed: excess and surplus (“E&S”) lines market.
−Removed: Substantially all of our business is casualty insurance and reinsurance, and for the year ended December 31, 2021, we derived 96.9% of our group-wide gross written premiums from casualty insurance and reinsurance.
+Added: For the year ended December 31, 2022, approximately 71.2% of our group-wide gross written premiums and 90.3% of our group-wide net written premiums originated from the U.S.
+Added: excess and surplus (“E&S”) lines market, which we believe puts us among the top three publicly traded insurers as ranked by highest concentrations of E&S risk.
+Added: Substantially all of our business is casualty insurance, and for the year ended December 31, 2022, we derived 96.5% of our group-wide gross written premiums from casualty insurance.
Our objective is to generate compelling returns on tangible equity, while limiting underwriting and investment volatility.
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When we do write property insurance, we buy reinsurance to significantly mitigate our risk.
−Removed: We have structured our reinsurance arrangements so that our modeled net pre-tax loss from a 1/1000 year probable maximum loss ("PML") event would not exceed 2.5% of shareholders’ equity on a group-wide basis.
+Added: We have structured our reinsurance arrangements so that our modeled net pre-tax loss from a 1/1000 year probable maximum loss ("PML") event would not exceed 2.5% of shareholders’ equity on a group-wide basis, inclusive of reinstatement premiums payable and net retentions.
We report our business in four segments:
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The Specialty Admitted Insurance segment produced 32.8% of our gross written premiums and 10.2% of our net written premiums for the year ended December 31, 2022.
−Removed: The Specialty Admitted Insurance segment has two areas of focus.
−Removed: We write a select book of workers’ compensation coverage for building trades, healthcare employees and light manufacturing, among other light to medium hazard risks in select U.S.
−Removed: We also write fronting business which has become a significant element of our revenues and profits in this segment.
−Removed: In our fronting business, we retain a small percentage of the risk, generally 10%-30%, and seek to earn fee income.
+Added: The Specialty Admitted Insurance segment primarily writes fronting business where we retain a minority share of the risk, generally 10%-35%, and seek to earn fee income.
When we front, we use our legal authority, financial strength rating, underwriting experience and claims infrastructure to write insurance to service clients (usually managing general agents and reinsurers) who assume the vast majority of the risk on each fronted policy.
Because we retain little premium or risk in our fronted business, we can allocate less capital per dollar of revenue to fronted policies than to policies where we retain more risk, which we believe enhances our returns on equity.
−Removed: The Specialty Admitted Insurance segment accepts applications for insurance from a variety of sources, including independent retail agents, program administrators and managing general agents (“MGAs”).
+Added: We also write a select book of workers’ compensation coverage for building trades, healthcare employees and light manufacturing, among other light to medium hazard risks in select U.S.
+Added: The Specialty Admitted Insurance segment accepts applications for insurance from a variety of sources, including fronting and program administrators, managing general agents (“MGAs”), and independent retail agents.
The Casualty Reinsurance segment distributes through reinsurance brokers and produced 5.7% of our gross written premiums and 11.1% of our net written premiums for the year ended December 31, 2022.
−Removed: The Casualty Reinsurance segment provides proportional and working layer casualty reinsurance to third parties and to our U.S.-based insurance subsidiaries.
+Added: The Casualty Reinsurance segment provides proportional and working layer casualty reinsurance to third parties and, through December 31, 2021, to our U.S.-based insurance subsidiaries.
Typically, we structure our reinsurance contracts (also known as treaties) as quota share arrangements, with loss mitigating features, such as commissions that adjust based on underwriting results.
We frequently include risk mitigating features in our working layer excess of loss treaties, such as paid reinstatements.
−Removed: On a premium volume basis, treaties with loss mitigation features, including sliding scale ceding commissions, represented 58.9% of the net premiums written by our Casualty Reinsurance segment during 2021.
+Added: On a premium volume basis, treaties with loss mitigation features, including profit and sliding scale ceding commissions, represented 40.6% of the net premiums written by our Casualty Reinsurance segment during 2022.
We typically do not assume large individual risks in our Casualty Reinsurance segment, nor do we write property catastrophe reinsurance.
Most of the underlying policies assumed by our Casualty Reinsurance segment have a $1.0 million per occurrence limit, and we typically assume only a portion of that exposure.
−Removed: We do not assume stand-alone third-party property business at our Casualty Reinsurance segment, but we do have a small amount of assumed business
−Removed: with ancillary property exposure.
−Removed: 65.7% of gross premiums written by our Casualty Reinsurance segment during 2021 were general liability accounts.
+Added: We do not assume stand-alone third-party property business at our Casualty Reinsurance segment, but we do have a
+Added: small amount of assumed business with ancillary property exposure.
+Added: General liability accounts represented 64.8% of gross premiums written by our Casualty Reinsurance segment during 2022.
The Casualty Reinsurance segment writes third party business through one entity, JRG Reinsurance Company Ltd.
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subsidiaries (after taking into account third-party reinsurance) to JRG Re.
−Removed: Effective January 1, 2018, we generally discontinued ceding 70% of our U.S.-written premiums to JRG Re and instead ceded 70% of our U.S.-written premiums to Carolina Re Ltd ("Carolina Re").
−Removed: This business is ceded under quota-share reinsurance treaties with ceding commissions that are negotiated at arm’s length.
+Added: Effective January 1, 2018 through December 31, 2021, we generally discontinued ceding 70% of our U.S.-written premiums to JRG Re and instead ceded 70% of our U.S.-written premiums to Carolina Re Ltd ("Carolina Re").
+Added: This business was ceded under quota-share reinsurance treaties with ceding commissions that were negotiated at arm’s length.
We exclude the effects of intercompany reinsurance agreements from the presentation of our segment results, consistent with the way we manage the Company.
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We believe the “A-” (Excellent) ratings assigned to our insurance and reinsurance subsidiaries allow our subsidiaries to actively pursue relationships with the agents and brokers identified in their marketing plans.
−Removed: Recent Developments
−Removed: Issuance of Series A Preferred Shares
−Removed: On February 24, 2022, we entered into an Investment Agreement with GPC Partners Investments (Thames) LP (“GPC Partners”), an affiliate of Gallatin Point Capital LLC, relating to the issuance and sale of 150,000 7% Series A Perpetual Cumulative Convertible Preferred Shares, par value $0.00125 per share (the “Series A Preferred Shares”), for an aggregate purchase price of $150.0 million, or $1,000 per share, in a private placement.
−Removed: The closing of the transaction is expected to occur on March 1, 2022 (the “Closing Date”).
−Removed: The Series A Preferred Shares rank senior to our common shares with respect to dividend rights and rights on the distribution of assets on any liquidation, dissolution or winding up of the affairs of the Company, upon which the holders of Series A Preferred Shares would receive the greater of the $1,000 liquidation preference per share plus accrued and unpaid dividends, or the amount they would have received if they had converted all of their Series A Preferred Shares to common shares immediately before such liquidation, dissolution or winding up.
−Removed: Holders of the Series A Preferred Shares are entitled to a dividend at the initial rate of 7% of the $1,000 per share liquidation preference per annum, paid in cash, in-kind in common shares or in Series A Preferred Shares, at our election.
−Removed: the five-year anniversary of the Closing Date, and each five-year anniversary thereafter, the dividend rate will reset to a rate equal to the five-year U.S.
−Removed: treasury rate plus 5.2%.
−Removed: Dividends will accrue quarterly and will be payable on March 31, June 30, September 30 and December 31 of each year, commencing June 30, 2022.
−Removed: The Series A Preferred Shares are convertible at the option of the holders thereof at any time into common shares at a conversion price set forth in the Certificate of Designations designating the Series A Preferred Shares (the “Certificate of Designations”), which is subject to anti-dilution adjustments.
−Removed: We may also require the Series A Preferred Shares to convert to common shares under certain circumstances.
−Removed: The holders of the Series A Preferred Shares may require us to repurchase their shares upon the occurrence of certain change of control events.
−Removed: Holders of the Series A Preferred Shares are entitled to vote with the holders of the common shares on an as-converted basis, and are entitled to a separate class vote with respect to certain actions specified in the Certificate of Designations.
−Removed: The Series A Preferred Shares held by GPC Partners, together with any common shares received on conversion of Series A Preferred Shares or as dividends with respect to Series A Preferred Shares, may not vote in excess of 9.9% of the aggregate voting power of our voting securities on an as converted basis.
−Removed: In addition, unless and until we obtain the shareholder approval required by Nasdaq Listing Standard Rule 5635, if such rule is applicable, GPC Partners will be subject to a 19.9% cap on voting power and beneficial ownership of our outstanding voting securities.
−Removed: GPC Partners and any transferees will also be subject to the voting limitations imposed on all U.S.
−Removed: persons contained in our bye-laws to the extent such restrictions are applicable.
−Removed: Until GPC Partners and its permitted transferees no longer beneficially own Series A Preferred Shares and/or common shares issued or issuable upon conversion of such Series A Preferred Shares that represent in the aggregate at least 50% of the number of common shares beneficially owned by them, on an as-converted basis, as of the Closing Date, GPC Partners will be entitled to designate one candidate for nomination to our Board of Directors.
−Removed: Until required regulatory approvals are obtained, such individual will have observer status.
−Removed: GPC Partners is obligated to comply with certain standstill provisions and transfer restrictions, and is entitled to customary registration rights for the common shares issuable on conversion of, or payable as dividends on, the Series A Preferred Shares.
−Removed: Loss Portfolio Transfer Retrocession Agreement
−Removed: On February 23, 2022, JRG Reinsurance Company, Ltd.
−Removed: (“JRG Re”), the Company’s property/casualty reinsurance subsidiary, entered into a Loss Portfolio Transfer Retrocession Agreement (the “Retrocession Agreement”) with Fortitude Reinsurance Company, Ltd.
−Removed: The Retrocession Agreement will close upon receipt of regulatory approval by FRL and satisfaction of other customary closing conditions (the date on which all closing conditions are satisfied, the “Retrocession Closing Date”).
−Removed: Pursuant to the Retrocession Agreement, JRG Re will (a) cede to FRL all existing and future claims for losses arising under certain casualty reinsurance agreements with underlying insurance companies with treaty inception dates ranging from 2011 to 2020 (the “Subject Business”), in each case net of third-party reinsurance and other recoveries, up to an aggregate limit of $400.0 million;
−Removed: (b) continue to manage and retain the benefit of other third-party reinsurance on the Subject Business;
−Removed: (c) pay FRL a reinsurance premium of $335.0 million, $310.0 million of which JRG Re will credit to a notional funds withheld account (the “Funds Withheld Account”) and $25.0 million of which JRG Re will pay in cash to FRL;
−Removed: and (d) pay FRL a 2% per annum crediting rate on the Funds Withheld Account balance on a quarterly basis.
−Removed: The total premium, Initial Funds Withheld Account credit, and aggregate limit will be adjusted for claims paid from October 1, 2021 to the Retrocession Closing Date.
In 2002, a group of experienced insurance executives created James River Group, Inc.
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JRVR) in 2005.
−Removed: James River Group had two insurance company subsidiaries, James River Insurance and Stonewood Insurance Company (“Stonewood Insurance”).
+Added: James River Group had two insurance company subsidiaries, James River Insurance and Stonewood Insurance.
Both of these subsidiaries as well as James River Group remain subsidiaries of ours.
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We are able to structure solutions for our insureds and the wholesale brokers with whom we work because of our deep technical expertise and experience in the niches and specialties we underwrite.
+Added: Focus on Small and Medium-Sized Casualty Niche and Specialty Business.
+Added: We believe that small and medium-sized casualty accounts, in niche areas where we focus, are consistently among the most attractive subsets of the property-casualty insurance and reinsurance market.
+Added: We think the unique characteristics of the risks within these markets require each account to be individually underwritten in an efficient manner.
+Added: Many carriers have chosen either to reject business that requires individual underwriting or have attempted to automate the underwriting of this highly variable business.
+Added: Since our inception, we have embraced technology to greatly reduce the cost of individually underwriting these accounts in our Excess and Surplus Lines and Specialty Admitted Insurance segments.
+Added: We are investing in technologies that may bring additional insights to our underwriters and allow them to refine and improve their risk selection and pricing.
+Added: We continue to have our underwriters make individual judgments regarding the underwriting and pricing of accounts.
+Added: Our experience leads us to believe this approach, combining expert judgment and technology designed to provide our underwriters with relevant information and quick processing, is still more likely to produce consistent results over time and across markets.
+Added: We are successfully increasing rates in our Excess and Surplus Lines segment.
+Added: Pricing on our E&S renewal book has increased for twenty-four consecutive quarters.
+Added: The Excess and Surplus Lines and Specialty Admitted segments combined represented 94.3% of our gross written premiums and 88.9% of our net written premiums for the year ended December 31, 2022.
+Added: We believe that there are compelling opportunities for measured but profitable growth in many sectors of the insurance markets we target.
Emphasis on Lowering Volatility.
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We underwrite many classes of insurance and invest in many types of assets.
−Removed: We believe we have minimal exposure to material property risks and did not have material losses from property risks during 2021.
+Added: We believe we have minimal exposure to material property risks and did not have meaningful losses from property risks during 2022.
We seek to limit our catastrophic underwriting exposure in all areas, but in particular to property risks and catastrophic events.
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In addition, our policy forms and pricing are subject to regular formal analysis in an effort to ensure we are insuring the types of risks we intend and that we are being appropriately compensated for taking on those risks.
−Removed: When we write reinsurance, we seek to avoid catastrophic risks and contractually limit the amount of exposure we have on any one risk or occurrence.
+Added: We write a small amount of reinsurance.
+Added: We seek to avoid catastrophic risks and contractually limit the amount of exposure we have on any one risk or occurrence in the reinsurance we write.
We prefer to structure our assumed reinsurance treaties as proportional or quota share reinsurance, which is generally less volatile than excess of loss or catastrophe reinsurance.
We believe this structure aligns our interests with those of the ceding company.
−Removed: Meaningful Risk Adjusted Investment Returns.
−Removed: We seek to generate meaningful contributions to company profitability from our investment portfolio.
−Removed: We attempt to follow a diversified strategy that emphasizes the preservation of our invested assets, provides adequate liquidity for the prompt payment of claims and produces attractive results for our shareholders.
−Removed: Within that context, we seek to improve risk-adjusted returns in our investment portfolio by allocating a portion of our portfolio to investments where we take measured risks based upon detailed knowledge of certain niche asset classes.
−Removed: Investment grade fixed maturity securities make up the majority of our investment portfolio, and we are comfortable allocating a portion of our assets to non-traditional investments.
−Removed: We consider non-traditional investments to include investments that are (1) unrated bond or fixed income securities, (2) non-listed equities or (3) investments that generally have less liquidity than rated bond or fixed income securities or listed equities.
−Removed: Non-traditional investments represented 8.9% of our total cash and invested assets (excluding restricted cash equivalents) at December 31, 2021, consisting of syndicated bank loans (6.7%) and other invested assets (2.2%) that include interests in limited liability companies that invest in renewable energy opportunities, limited partnerships that invest in debt or equity securities, notes receivable for renewable energy projects, and a private debt security.
−Removed: While we are willing to make investments in non-traditional types of investments, we seek to avoid asset classes and investments that we do not understand.
−Removed: The weighted average credit rating of our portfolio of fixed maturity securities, bank loans and preferred stocks as of December 31, 2021 was “A”.
−Removed: At December 31, 2021, the average duration of our investment portfolio was 4.0 years.
Talented Underwriters and Operating Leadership.
The managers of our 15 underwriting divisions have an average of over 25 years of industry experience, substantial subject matter expertise and deep technical knowledge.
−Removed: They have been successful and profitable underwriters for us in the specialty casualty insurance and reinsurance sectors.
+Added: They have been successful and profitable underwriters for us in the specialty casualty insurance sector.
Our segment presidents all have extensive backgrounds and histories working in management capacities in specialty casualty insurance and reinsurance.
−Removed: Our newly joined Chief Actuary, Chief Claims Officer and Chief Underwriting Officer also bring extensive backgrounds in operational leadership within specialty casualty insurance and reinsurance, including a deep focus on risk management.
+Added: Our recently joined Chief Actuary, Chief U.S.
+Added: Claims Officer and Chief Underwriting Officer also bring extensive backgrounds in operational leadership within specialty casualty insurance and reinsurance, including a deep focus on risk management.
+Added: Efficient Operating Platform.
+Added: We have what we believe to be an extremely attractive expense ratio, as we carefully manage personnel and all other costs throughout our group while growing our business.
+Added: For the year ended December 31, 2022, our expense ratio was 25.0%.
Robust Technology and Data Capture.
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We use the data we collect in regular formal review processes for each of our lines of business and significant reinsurance treaties.
−Removed: Focus on Small and Medium-Sized Casualty Niche and Specialty Business.
−Removed: We believe that small and medium-sized casualty accounts, in niche areas where we focus, are consistently among the most attractive subsets of the property-casualty insurance and reinsurance market.
−Removed: We think the unique characteristics of the risks within these markets require each account to be individually underwritten in an efficient manner.
−Removed: Many carriers have chosen either to reject business that requires individual underwriting or have attempted to automate the underwriting of this highly variable business.
−Removed: Since our inception, we have embraced technology to greatly reduce the cost of individually underwriting these accounts in our Excess and Surplus Lines and Specialty Admitted Insurance segments.
−Removed: We are investing in technologies that may bring additional insights to our underwriters and allow them to refine and improve their
−Removed: risk selection and pricing.
−Removed: We continue to have our underwriters make individual judgments regarding the underwriting and pricing of accounts.
−Removed: Our experience leads us to believe this approach, combining expert judgment and technology designed to provide our underwriters with relevant information and quick processing, is still more likely to produce consistent results over time and across markets.
−Removed: While we believe the insurance and reinsurance industry is generally overcapitalized at this time, we are successfully increasing rates in our Excess and Surplus Lines and Specialty Admitted Insurance segments.
−Removed: Pricing on our E&S renewal book has increased for twenty consecutive quarters.
−Removed: The E&S and Specialty Admitted segments combined represented 87.9% of our gross written premiums and 78.6% of our net written premiums for the twelve months ended December 31, 2021.
−Removed: We believe that there are compelling opportunities for measured but profitable growth in many sectors of the insurance markets we target.
Active Claims Management.
−Removed: Our U.S.-based primary insurance companies actively manage claims as part of keeping losses and loss adjustment expenses low.
+Added: Our U.S.-based primary insurance companies actively manage claims.
We attempt to investigate thoroughly and settle promptly all covered claims, which we generally accomplish through direct contact with the insured and other affected parties.
We have historically been able to close approximately 95% of claims from a particular policy year within the five subsequent years, and as of December 31, 2022, our reserves for claims incurred but not reported (“IBNR”) were 66.6% of our total net loss reserves.
−Removed: Efficient Operating Platform.
−Removed: We have what we believe to be an extremely attractive expense ratio, as we carefully manage personnel and all other costs throughout our group while growing our business.
−Removed: For the year ended December 31, 2021, our expense ratio was 23%.
−Removed: At December 31, 2021, 41.2% of our invested assets were held at JRG Re.
+Added: Meaningful Risk Adjusted Investment Returns.
+Added: We seek to generate meaningful contributions to company profitability from our investment portfolio.
+Added: We attempt to follow a strategy that emphasizes the preservation of our invested assets, provides adequate liquidity for the prompt payment of claims and produces attractive results for our shareholders.
+Added: Within that context, we seek to improve risk-adjusted returns in our investment portfolio by allocating a portion of our portfolio to investments where we take measured risks based upon detailed knowledge of certain niche asset classes.
+Added: Investment grade fixed maturity securities make up the majority of our investment portfolio, and we are comfortable allocating a portion of our assets to non-traditional investments.
+Added: We consider non-traditional investments to include investments that are (1) unrated bond or fixed income securities, (2) non-listed equities or (3) investments that generally have less liquidity than rated bond or fixed income securities or listed equities.
+Added: Non-traditional investments represented 7.8% of our total cash and invested assets (excluding restricted cash equivalents) at December 31, 2022, consisting of syndicated bank loans (6.6%) and other invested assets (1.2%) that include interests in limited liability companies that invest in renewable energy opportunities, limited partnerships that invest in debt or equity securities, notes receivable for renewable energy projects, and a private debt security.
+Added: While we are willing to make investments in non-traditional types of investments, we seek to avoid asset classes and investments that we do not understand.
+Added: The weighted average credit rating of our portfolio of fixed maturity securities, bank loans and preferred stocks as of December 31, 2022 was “A”.
+Added: At December 31, 2022, the average duration of our total invested assets and cash, excluding restricted cash, was 4.1 years.
We believe our approach to our business will help us achieve our goal of generating compelling returns on tangible equity while limiting volatility in our financial results.
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In order to maintain balance sheet integrity, we seek to estimate the amount of future obligations, especially reserves for losses and loss adjustment expenses, in a consistent and appropriate fashion.
−Removed: Earn a Meaningful Contribution from Investments.
−Removed: We seek to earn a meaningful contribution to our overall returns from our investment portfolio activities each year.
−Removed: We attempt to balance the preservation of assets, liquidity needs and mitigation of volatility with returns across our portfolio.
−Removed: We believe our diversified portfolio and ability to source investment opportunities positions us well to generate returns while balancing the importance of maintaining a strong balance sheet.
+Added: Respond Rapidly to Market Opportunities and Challenges.
+Added: For the year ended December 31, 2022, gross written premiums for the Excess and Surplus Lines segment increased by 10.5% over the same period in 2021.
+Added: We seek to grow our business by taking advantage of opportunities in markets in which we believe we can use our expertise to generate consistent underwriting profits.
+Added: We seek to measure rates and react quickly to changes in the rates or terms the market will accept.
+Added: In this favorable pricing environment, we have taken steps to grow and are increasing gross written premiums across most underwriting divisions in this segment.
+Added: In 2022, our growth was primarily focused in our Excess Casualty, General Casualty, Manufacturers & Contractors, Excess Property, Sports and Entertainment and Small Business divisions within our Excess and Surplus Lines segment.
+Added: This very specific evaluation of each risk or class of risks is a hallmark of our underwriting.
+Added: When market conditions have been challenging, or when actual experience has not been as favorable as we anticipated, or when the size or risk profile of certain insureds or lines of business change, we have tried to act quickly to evaluate our situation and to make course corrections in order to protect our profits and preserve tangible equity.
+Added: Our actions have included reducing our writings when margins tightened and exiting lines or classes of business when we believed the risk of continuing in a line outweighed the potential rewards from underwriting.
+Added: We do not hesitate to increase loss estimates when we determine that it is appropriate.
Focus on Specialty Insurance Markets and Fee Income.
We focus on specialty markets in which our underwriters have particular expertise and in which we have fewer competitors than in standard markets, and greater flexibility to price and structure our products in accordance with our underwriting strategy.
−Removed: We believe underwriting profitability can best be achieved through restricting our risk taking on insurance and reinsurance to niches where, because of our expertise, we can distinguish ourselves in the underwriting and pricing process.
+Added: We believe underwriting profitability can best be achieved through restricting our risk taking to niches where, because of our expertise, we can distinguish ourselves in the underwriting and pricing process.
We also believe that we can achieve attractive returns on capital through the growth of our fronting business, as we carefully manage credit and collateral to generate attractive fee income, while generally utilizing less capital than in our highly underwritten businesses.
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Additionally, the claims staff also contributes to our underwriting operations through its communication of claims information to our underwriters.
−Removed: Respond Rapidly to Market Opportunities and Challenges.
−Removed: For the year ended December 31, 2021, gross written premiums for the Excess and Surplus Lines segment excluding commercial auto (“Core E&S”) increased by 19.4% over the same period in 2020.
−Removed: We plan to grow our business to take advantage of opportunities in markets in which we believe we can use our expertise to generate consistent underwriting profits.
−Removed: We seek to measure rates monthly and react quickly to changes in the rates or terms the market will accept.
−Removed: In this favorable pricing environment, we have taken steps to grow and are increasing gross written premiums across most underwriting divisions in this segment.
−Removed: In 2021, our growth was primarily focused in our Excess Casualty, General Casualty, Manufacturers & Contractors, Excess Property, and Life Sciences divisions within our Excess and Surplus Lines segment.
−Removed: This very specific evaluation of each risk or class of risks is a hallmark of our underwriting.
−Removed: When market conditions have been challenging, or when actual experience has not been as favorable as we anticipated, or when the size or risk profile of certain insureds or lines of business change, we have tried to act quickly to evaluate our situation and to make course corrections in order to protect our profits and preserve tangible equity.
−Removed: Our actions have included reducing our writings when margins tightened and exiting lines or classes of business when we believed the risk of continuing in a line outweighed the potential rewards from underwriting.
−Removed: We do not hesitate to increase loss estimates when we determine that it is appropriate.
+Added: Earn a Meaningful Contribution from Investments.
+Added: We seek to earn a meaningful contribution to our overall returns from our investment portfolio activities each year.
+Added: We attempt to balance the preservation of assets, liquidity needs and mitigation of volatility with returns across our portfolio.
+Added: We believe our diversified portfolio and ability to source investment opportunities positions us well to generate returns while balancing the importance of maintaining a strong balance sheet.
Manage Capital Actively.
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Excess and Surplus Lines Segment
−Removed: We underwrite non-admitted E&S business through our subsidiaries, James River Insurance Company and James River Casualty Company (together, “James River,” which comprises our Excess and Surplus Lines segment), from offices in Richmond, Virginia;
+Added: We underwrite non-admitted E&S business through our subsidiaries, James River Insurance and James River Casualty (together, “James River,” which comprises our Excess and Surplus Lines segment), from offices in Richmond, Virginia;
Scottsdale, Arizona;
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James River has been engaged in the E&S insurance market for 20 years.
−Removed: The E&S industry focuses on insuring commercial insureds that may be unable to purchase insurance from standard lines insurers typically due to perceived risk related to their products or operations.
+Added: The E&S industry focuses on providing insurance coverage to policyholders that may be unable to purchase insurance from standard lines insurers typically due to perceived risk related to their operations or risk exposures.
Our Excess and Surplus Lines segment underwrites property-casualty insurance in all states and the District of Columbia.
We utilize a network of authorized wholesale brokers and general agents throughout the United States.
−Removed: In 2021, our Excess and Surplus Lines segment’s gross written premiums increased by 19.2% over 2020.
+Added: Gross written premiums for our Excess and Surplus Lines segment grew by 10.5% and 19.2% in 2022 and 2021, respectively.
+Added: Net written premiums grew by 17.5% and 11.3% in 2022 and 2021, respectively.
In 2020, our Excess and Surplus Lines segment’s gross written premiums shrank by 24.2% relative to 2019 due to the early cancellation in late 2019 of a large commercial auto account.
−Removed: Gross written premiums for our Core E&S business, which excludes our commercial auto division, grew by 19.4% and 29.5% in 2021 and 2020, respectively.
−Removed: The Excess and Surplus Lines segment produced a weighted-average combined ratio of 95.2% from 2012 through 2021.
+Added: The Excess and Surplus Lines segment produced a cumulative combined ratio of 94.1% from 2013 through 2022.
Companies that underwrite on an E&S lines basis operate under a different regulatory structure than standard market carriers.
−Removed: E&S lines carriers are generally permitted to craft the terms of the insurance contract to suit the particular risk they are assuming.
+Added: E&S lines carriers are generally permitted to craft the terms of the insurance contract to suit the particular risk they are
E&S lines carriers are, for the most part, free of rate and form regulation.
In contrast, standard market carriers are generally required to use approved insurance forms and to charge rates that have been authorized by or filed with state insurance departments.
−Removed: However, as E&S carriers, our insurance subsidiaries in the Excess and Surplus Lines segment are not backed by any state’s guarantee fund, and in most states these subsidiaries may only write coverage for an insured after they have been denied coverage by the standard market and signed declarations stating that the insured is aware that it will not have access to any state guarantee funds should these subsidiaries be unable to satisfy their obligations.
+Added: However, as E&S carriers, our insurance subsidiaries in the Excess and Surplus Lines segment are not backed by any state’s guarantee fund, and in most states these subsidiaries may only write coverage for an insured after they have been declined coverage by the standard market.
Our Excess and Surplus Lines segment underwrites coverage for a wide range of commercial businesses and does not write personal lines insurance.
−Removed: Applications for insurance are presented to us by authorized wholesale brokers who are typically engaged by retail agents after their clients have been rejected by standard markets.
−Removed: In late 2017, the Excess and Surplus Lines segment started a binding contract unit (as part of our Small Business underwriting division) where limited authority for underwriting is delegated to a select, but growing, group of agents on a limited number of General Liability classes through a company designed online portal.
−Removed: All claims for business written by the Excess and Surplus Lines segment are managed by our internal claims department although we use independent adjusters for inspection and payment of certain claims.
+Added: Applications for insurance are presented to us by authorized wholesale brokers who are engaged by retail agents to assist in coverage procurement.
+Added: Claims for business written and retained by the Excess and Surplus Lines segment are managed by our internal claims department although we use independent adjusters for inspection and payment of certain claims.
The chart below identifies the Excess and Surplus Lines segment’s divisions and sets forth the amount of gross written premiums by each division.
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2022 2021 2020 2019 2018
+Added: (in thousands)
Excess Casualty $ 310,383 33.7 % $ 285,082 $ 213,037 $ 118,954 $ 66,452
3 unchanged sentences
Energy 42,290 4.6 % 46,216 51,109 45,442 33,942
−Removed: Life Sciences 35,935 4.3 % 35,163 24,462 16,636 12,981
−Removed: Allied Health 35,192 4.2 % 26,918 26,713 30,450 19,181
Commercial Auto 37,974 4.1 % 34,630 30,029 405,565 322,126
Small Business 36,930 4.0 % 32,593 24,790 19,725 14,808
+Added: Allied Health 34,156 3.7 % 35,192 26,918 26,713 30,450
+Added: Life Sciences 32,277 3.5 % 35,935 35,163 24,462 16,636
Environmental 20,676 2.2 % 17,050 17,753 16,539 10,499
8 unchanged sentences
When we write above others’ policies, we are selective regarding underlying carriers, focusing on the nature of the business, the financial strength of the carrier, their pricing and their claims handling capabilities.
−Removed: The underwriter who heads this division has 39 years of industry experience.
−Removed: General Casualty writes primary liability coverage on businesses exposed to premises liability type claims including real estate, mercantile and retail operations, apartments and condominiums, daycare facilities, hotels and motels, restaurants, bars, taverns and schools.
−Removed: The head underwriter in this division has 35 years of experience.
+Added: General Casualty writes primary liability coverage on businesses exposed to premises liability type claims including real estate, mercantile and retail operations, apartments and condominiums, hotels and motels, restaurants, bars, taverns and schools.
Typically, we write $1.0 million per occurrence in limits, and we retain the entire $1.0 million limit.
Manufacturers and Contractors writes primary general liability coverage for a variety of classes, including manufacturers of consumer, commercial, and industrial products and general and trade contractors.
−Removed: Typically, we issue a $1.0 million per
−Removed: occurrence limit in this division and we retain the entire $1.0 million limit.
−Removed: The individual overseeing this division has 39 years of industry experience.
+Added: Typically, we issue a $1.0 million per occurrence limit in this division, and we retain the entire $1.0 million limit.
Excess Property writes property risks providing limits in various layers above the primary coverage layer for a variety of classes, including apartments, condominiums, resorts, shopping centers, offices and general commercial properties.
Typical per risk limits offered range from $5.0 million to $30.0 million on a gross basis, and a maximum of $5.0 million on a net of reinsurance basis.
−Removed: The average net per risk limit is approximately $1.6 million as of December 31, 2021.
+Added: The average net per risk limit is approximately $860,000 as of December 31, 2022.
We retain up to the first $5.0 million in any one event or catastrophe.
−Removed: The underwriter leading our Excess Property division has 33 years of experience in the industry.
Energy writes risks engaged in the business of energy production, distribution or mining, and the manufacture of equipment used in the energy business segment.
−Removed: Examples of classes underwritten by this division include oil and gas exploration companies, oil or gas well drillers, oilfield consultants, oil or gas lease operators, oil well servicing companies, oil or gas pipeline construction companies, fireworks manufacturing, mining-related risks, utilities, and utility contractors.
+Added: Examples of classes underwritten by this division include oil and gas
+Added: exploration companies, oil or gas well drillers, oilfield consultants, oil or gas lease operators, oil well servicing companies, oil or gas pipeline construction companies, fireworks manufacturing, mining-related risks, utilities, and utility contractors.
We provide policy limits up to $11.0 million, with typical limits between $1.0 million and $5.0 million per occurrence, retaining up to $1.0 million in limit net on either a primary or excess basis.
−Removed: The underwriter leading this division has more than 39 years of experience in the business.
−Removed: Life Sciences underwrites general liability, products liability and/or professional liability coverage for manufacturers, distributors and developers of biologics (antibodies & vaccines used for the prevention of disease), nutraceuticals (health, nutrition and herbal supplements), human clinical trials, pharmaceuticals (mainly generics and over-the-counters) and medical devices.
−Removed: This division also writes a book of various types of business engaged in the medical and adult-use cannabis industry.
−Removed: We provide policy limits up to $11.0 million (up to $10.0 million on cannabis), with typical limits between $1.0 million and $5.0 million per occurrence, retaining up to $1.0 million in limit net.
−Removed: The underwriter at the head of this division has 39 years of experience in the industry.
−Removed: Allied Health underwrites casualty insurance for allied health and social service types of risks, such as long-term care facilities, independent living apartments, group homes, half-way houses and shelters, drug rehabilitation, home health care and medical staffing enterprises.
−Removed: We provide policy limits up to $11.0 million, with typical limits between $1.0 million and $5.0 million per occurrence, retaining up to $1.0 million in limit net.
−Removed: The underwriter responsible for this unit has 29 years of experience in the business.
−Removed: Approximately 88% of the premiums written by our Allied Health division from inception through 2021 have been written on a claims-made and reported form.
−Removed: We believe this policy form significantly reduces our long-term exposure in this complicated class of business.
Commercial Auto underwrites primarily the hired and non-owned auto liability exposures for a variety of industry segments including package and food delivery services.
On December 31, 2019, we terminated coverage for our largest commercial auto insured (Rasier) which comprised $374.2 million of gross written premiums in 2019, representing 40.6% of the Excess and Surplus Lines segment’s gross written premiums and 25.4% of our consolidated gross written premiums for the year ended December 31, 2019.
−Removed: The underwriter leading this division has 35 years of experience.
Limits assumed are retained by the Company, in some cases subject to self-insured retentions of the insureds.
−Removed: Small Business concentrates on brokerage accounts with annual primary liability insurance premiums of less than $10,000.
+Added: Small Business includes both brokerage and delegated authority contract binding focusing on accounts with annual primary liability insurance premiums of less than $10,000.
For these smaller risks, we limit flexibility in coverage options and pricing to facilitate quick turnaround and efficient processing.
We generally write $1.0 million per occurrence limits and retain the entire amount.
−Removed: The underwriter leading this division has 29 years of industry experience.
+Added: Allied Health underwrites casualty insurance for allied health and social service types of risks, such as long-term care facilities, independent living apartments, group homes, half-way houses and shelters, drug rehabilitation, home health care and medical staffing enterprises.
+Added: We provide policy limits up to $11.0 million, with typical limits between $1.0 million and $5.0 million per occurrence, retaining up to $1.0 million in limit net.
+Added: Approximately 88% of the premiums written by our Allied Health division from inception through 2022 have been written on a claims-made and reported form.
+Added: We believe this policy form significantly reduces our long-term exposure in this complicated class of business.
+Added: Life Sciences underwrites general liability, products liability and/or professional liability coverage for manufacturers, distributors and developers of biologics (antibodies & vaccines used for the prevention of disease), nutraceuticals (health, nutrition and herbal supplements), human clinical trials, pharmaceuticals (mainly generics and over-the-counters) and medical devices.
+Added: This division also writes a book of various types of business engaged in the medical and adult-use cannabis industry.
+Added: We provide policy limits up to $11.0 million (up to $10.0 million on cannabis), with typical limits between $1.0 million and $5.0 million per occurrence, retaining up to $1.0 million in limit net.
Environmental underwrites contractors’ pollution liability, products pollution liability, site specific pollution liability and consultant’s professional liability coverage on a stand-alone basis and in conjunction with the general liability coverage.
−Removed: The underwriter heading our Environmental division has more than 39 years of experience in the business.
Typically, we write environmental coverage for contractors who are not engaged in environmental remediation work on an occurrence form.
We provide policy limits up to $11.0 million, with typical limits between $1.0 million and $5.0 million per occurrence, retaining up to $1.0 million in limit net on a primary or excess basis.
−Removed: Sports and Entertainment underwrites primary liability coverage for sports and entertainment related risks, including special events, family entertainment centers, tourist attractions, health clubs and sport teams, leagues and complexes.
+Added: Sports and Entertainment underwrites primary liability coverage for sports, recreation and entertainment related risks, including special events, family entertainment centers, tourist attractions, health clubs, sports complexes and other sport and event venues.
Typical limits offered are up to $1.0 million per occurrence, and we retain the entire $1.0 million limit.
−Removed: The underwriter at the head of this division has 35 years of experience in the industry.
Professional Liability writes professional liability coverage for accountants, architects, engineers, lawyers and certain other professions.
We provide policy limits up to $11.0 million, with typical limits between $1.0 million and $5.0 million per occurrence, retaining up to $1.0 million in limit net.
−Removed: The individual who directs our professional liability division has 29 years of industry experience.
All of our professional liability coverage is written on a claims-made and reported basis.
3 unchanged sentences
All of the policies written by this division have been issued on a claims-made and reported basis.
−Removed: The underwriter leading this division has 29 years of experience.
The following table identifies the top producing states by amount of gross written premium for our Excess and Surplus Lines segment for the year ended December 31, 2022 and the amount of gross written premium produced by such states for the years ended December 31, 2021, 2020, 2019 and 2018.
5 unchanged sentences
Premiums Gross
−Removed: California $ 147,677 17.7 % $ 136,532 19.5 % $ 368,488 40.0 % $ 213,729 $ 153,340
Florida $ 161,679 17.5 % $ 137,880 16.5 % $ 104,120 14.9 % $ 67,700 $ 47,918
+Added: California 157,519 17.1 % 147,677 17.7 % 136,532 19.5 % 368,488 213,729
Texas 146,737 15.9 % 128,312 15.4 % 79,338 11.4 % 51,978 31,604
New York 112,189 12.2 % 101,820 12.2 % 108,778 15.6 % 89,680 54,417
−Removed: Washington 22,778 2.7 % 16,407 2.4 % 16,573 1.8 % 17,329 13,697
−Removed: New Jersey 22,131 2.7 % 17,621 2.5 % 13,425 1.5 % 12,147 17,486
Pennsylvania 23,548 2.5 % 22,055 2.6 % 19,008 2.7 % 16,206 8,562
−Removed: Illinois 19,010 2.3 % 16,243 2.3 % 14,491 1.6 % 20,893 25,853
−Removed: Massachusetts 16,682 2.0 % 13,762 2.0 % 34,494 3.7 % 19,758 13,587
+Added: New Jersey 23,383 2.5 % 22,131 2.7 % 17,621 2.5 % 13,425 12,147
+Added: Washington 22,618 2.5 % 22,778 2.7 % 16,407 2.4 % 16,573 17,329
Arizona 20,972 2.3 % 16,544 2.0 % 12,782 1.8 % 9,023 5,160
−Removed: Louisiana 15,723 1.9 % 13,968 2.0 % 16,001 1.7 % 12,654 8,508
Georgia 18,636 2.0 % 15,522 1.9 % 11,934 1.7 % 10,936 9,120
−Removed: Ohio 13,156 1.6 % 9,210 1.3 % 10,537 1.1 % 13,043 8,283
+Added: Illinois 17,526 1.9 % 19,010 2.3 % 16,243 2.3 % 14,491 20,893
+Added: Louisiana 17,161 1.9 % 15,723 1.9 % 13,968 2.0 % 16,001 12,654
+Added: Massachusetts 13,458 1.5 % 16,682 2.0 % 13,762 2.0 % 34,494 19,758
Missouri 12,446 1.4 % 11,967 1.4 % 10,080 1.4 % 14,628 9,424
−Removed: North Carolina 10,060 1.2 % 7,957 1.1 % 9,950 1.1 % 10,305 8,199
+Added: Virginia 11,125 1.2 % 8,663 1.0 % 8,932 1.3 % 23,563 15,532
+Added: Ohio 11,091 1.2 % 13,156 1.6 % 9,210 1.3 % 10,537 13,043
All other states 151,076 16.4 % 133,737 16.1 % 120,428 17.2 % 164,597 165,248
3 unchanged sentences
These brokers procure policies for their clients from us as well as from other insurance companies.
−Removed: At December 31, 2021, the segment had authorized 109 broker groups to submit applications to us.
+Added: At December 31, 2022, the segment had authorized close to 100 broker groups to submit applications to us.
The Excess and Surplus Lines segment generally makes broker authorizations by brokerage office and underwriting division.
3 unchanged sentences
While many of our Excess and Surplus Lines segment’s brokers have more than one office, we evaluate each office as if it were a separate entity.
−Removed: Brokers must be able to demonstrate an ability to competently produce both the quality and quantity of business that we seek.
+Added: Brokers must be able to demonstrate an ability to produce both the quality and quantity of business that we seek.
Brokers unable to produce consistently profitable business, or who produce unacceptably low volumes of business, may be terminated.
2 unchanged sentences
Our Excess and Surplus Lines segment’s three largest brokers produced $643.3 million of gross written premiums for the year ended December 31, 2022, representing approximately 69.8% of the Excess and Surplus Lines segment’s gross written premiums and 43.0% of consolidated gross written premiums for 2022.
−Removed: The three largest brokers produced $239.1 million (Ryan Specialty Group), $197.3 million (AmWins Group), and $132.5 million (Truist Insurance Holdings) of gross written
−Removed: premiums for the year ended December 31, 2021, respectively, representing 15.9%, 13.1%, and 8.8% of consolidated gross written premiums and 28.7%, 23.7%, and 15.9% of the Excess and Surplus Lines segment’s gross written premiums for 2021, respectively.
+Added: The three largest brokers produced $289.7 million (Ryan Specialty Group), $214.2 million (AmWins Group), and $139.4 million (Truist Insurance Holdings) of gross written premiums for the year ended December 31, 2022, respectively, representing 19.4%, 14.3%, and 9.3% of consolidated gross written premiums and 31.4%, 23.3%, and 15.1% of the Excess and Surplus Lines segment’s gross written premiums for 2022, respectively.
In 2022 and 2021, our Excess and Surplus Lines segment paid an average commission to producers of 16.8% and 16.6%, respectively, of gross written premiums.
2 unchanged sentences
Our Excess and Surplus Lines segment binds approximately 4% of new submissions and one out of every five new quotes.
−Removed: We realize all excess and surplus lines applications have already been rejected by the standard market.
−Removed: If our underwriters cannot reasonably expect to bind coverage at the combination of premiums and coverage that meet our standards, they are encouraged to quickly move on to another prospective opportunity.
+Added: If our underwriters cannot reasonably expect to bind coverage at the combination of premiums and coverage that meet our standards, they are encouraged to quickly move on
+Added: to another prospective opportunity.
For the year ended December 31, 2022, we received approximately 288,000 submissions (new and renewal, excluding commercial auto policies), quoted over 59,000 policies and bound over 25,000 policies.
8 unchanged sentences
We believe that effective management of claims settlement and any associated litigation avoids delays and associated additional costs.
−Removed: Our Excess and Surplus Lines segment’s claims department consists of over 85 claims professionals as of December 31, 2021 with significant claims experience in the property-casualty industry.
+Added: Over 60 claims professionals with significant experience in the property-casualty industry support our Excess and Surplus Lines segment as of December 31, 2022.
Our excess and surplus lines business generally results in claims from premises/operations liability, professional liability, hired and non-owned auto liability, auto physical damage, first party property losses and products liability.
8 unchanged sentences
Our claims staff also contributes to our underwriting operations through communication of claims information to our underwriters.
−Removed: Members of our Claims management team participate on our forms committee, which reviews and develops all policy forms and exclusions, and are also members of the underwriting review committee.
+Added: Members of our Claims team participate on our forms committee, which reviews and develops all policy forms and exclusions, and are also members of the underwriting review committee.
Approximately 93% of all claims received are closed within five years in the Excess and Surplus Lines segment.
1 unchanged sentence
The calendar year loss ratios for 2017 through 2021 were impacted by adverse reserve development of $38.7 million, $20.7 million, $57.4 million, $91.4 million and $200.1 million, respectively, in the commercial auto line of business that was primarily related to a former insured, Rasier LLC and its affiliates (“Rasier”).
−Removed: The loss ratio for 2021 also includes $5.0 million of net catastrophe losses related to Hurricane Ida in the Excess Property line of business.
−Removed: On September 27, 2021, James River entered into a loss portfolio transfer reinsurance transaction with Aleka Insurance, Inc.
−Removed: (“Aleka”), a captive insurance company affiliate of Rasier, to reinsure substantially all of the Excess and Surplus Lines segment's legacy portfolio of commercial auto policies previously issued to Rasier for which James River is not otherwise indemnified by Rasier.
+Added: The loss ratios for 2022 and 2021 also include net catastrophe losses in the Excess Property line of business of $5.0 million related to Hurricane Ian in 2022 and $5.0 million related to Hurricane Ida in 2021.
+Added: On September 27, 2021, James River entered into a loss portfolio transfer transaction (the “Commercial Auto LPT”) with Aleka Insurance, Inc.
+Added: (“Aleka”), a captive insurance company affiliate of Rasier LLC, to reinsure substantially all of the Excess and Surplus Lines segment’s legacy portfolio of commercial auto policies previously issued to Rasier for which James River is not otherwise indemnified by Rasier.
Under the terms of the transaction, effective as of July 1, 2021, James River ceded to Aleka approximately $345.1 million of commercial auto liabilities relating to Rasier policies written in the years 2013-2019, which amount constituted the reinsurance premium.
−Removed: The reinsurance coverage is fully collateralized, not subject to an aggregate limit, and subject to certain exclusions.
+Added: The reinsurance coverage is structured to be fully collateralized, is not subject to an aggregate limit, and is subject to certain exclusions.
+Added: A pre-tax loss of $29.6 million was recognized as adverse loss and loss adjustment reserve development in the Excess and Surplus Lines segment for the third quarter of 2021 associated with the loss portfolio transfer.
+Added: For the year ended December 31, 2022, due to adverse paid loss trends on the legacy Rasier business, the Company recognized adverse prior year development of $46.7 million on the net reserves subject to the Commercial Auto LPT, resulting in a corresponding additional amount ceded under the Commercial Auto LPT.
+Added: As a result, the cumulative amounts ceded under the Commercial Auto LPT exceed the consideration paid, moving the Commercial Auto LPT into a gain position.
+Added: The Company has applied retroactive reinsurance accounting to the Commercial Auto LPT.
+Added: A retroactive reinsurance benefit of $31.0 million was recorded in losses and loss adjustment expenses on the Consolidated Statements of Income (Loss) and Comprehensive (Loss) Income for the year ended December 31, 2022 using the recovery method.
+Added: As of December 31, 2022 and December 31, 2021, the cumulative amounts ceded under the Commercial Auto LPT were $391.8 million and $345.1 million, respectively.
+Added: The unrecognized deferred retroactive reinsurance gain of $15.7 million at December 31, 2022 is separately presented on the Company's Consolidated Balance Sheets.
Specialty Admitted Insurance Segment
1 unchanged sentence
insurance segment, Specialty Admitted Insurance.
−Removed: Falls Lake consists of Falls Lake National Insurance Company (an Ohio domiciled company, licensed in 49 states and the District of Columbia and registered as a surplus lines company in California), and its subsidiaries Stonewood Insurance Company (a North Carolina domiciled company) and Falls Lake Fire and Casualty Company (a California domiciled company).
+Added: Falls Lake consists of Falls Lake National (an Ohio domiciled company, licensed in 49 states and the District of Columbia and registered as a surplus lines company in California), and its subsidiaries Stonewood Insurance (a North Carolina domiciled company) and Falls Lake Fire and Casualty (a California domiciled company).
The Specialty Admitted Insurance segment produced 32.8% of consolidated gross written premiums for the year ended December 31, 2022.
−Removed: Our plan is to continue to use our broad licensure and significant management expertise to earn substantial fee income as well as underwriting profits.
+Added: Our plan is to continue to use our broad licensure and significant management expertise to earn fee income as well as underwriting profits.
The Specialty Admitted Insurance segment consists of:
−Removed: • Individual risk workers’ compensation business, underwritten by our staff and generated by appointed agents in 13 states, that produced 11.7% of 2021 gross written premiums in this segment, (15.6% in 2020, 16.4% in 2019, 14.8% in 2018, 13.9% in 2017, and 21.7% in 2016);
• Fronting and program business written through selected MGAs, insurance carriers, and other producers, which represented 89.2% of 2022 gross written premiums in this segment, (88.3% in 2021, 84.4% in 2020, 83.6% in 2019, 85.2% in 2018, and 86.1% in 2017);
−Removed: Traditional Workers’ Compensation Business
−Removed: Our individual risk workers’ compensation business, produced through a distribution channel comprised of appointed independent retail agents and a limited number of appointed wholesale brokers, remains a regionally focused effort in select Southeastern U.S.
−Removed: We made the strategic decision in 2020 to focus our efforts towards the Southeast, and to substantially reduce our presence in other states.
−Removed: This decision was based upon a wide range of factors, including ability to exceed internal performance metrics, regulations regarding pricing and cost containment, and our agent relationships.
−Removed: For the year ended December 31, 2021, approximately 36% of our retail produced workers’ compensation direct written premiums were in North Carolina, 17% were in Georgia, 17% were in Missouri, and 12% were in Virginia.
−Removed: Building trades represented approximately 32% of the direct premiums in force in our retail produced workers’ compensation book in 2021.
−Removed: Other significant industry groups include specialty transportation (14%), healthcare employees (13%), goods and services (13%), manufacturing (13%), and agriculture (8%).
−Removed: We view our retail produced workers’ compensation business as a core competency and seek to make consistent underwriting profits from it.
−Removed: We recognize the cyclical nature of this line and are prepared to contract the business rapidly when rates decline, or the regulatory or economic environment makes it difficult to contain costs.
+Added: • Individual risk workers’ compensation business, underwritten by our staff and generated by appointed agents in 13 states, that produced 10.8% of 2022 gross written premiums in this segment, (11.7% in 2021, 15.6% in 2020, 16.4% in 2019, 14.8% in 2018, and 13.9% in 2017).
Fronting & Program Business
In our fronting business, we issue insurance policies for another insurance company which may not have the licensure, product suite or rating to serve its desired market, or for a program supported by reinsurance or alternative capital provider(s).
+Added: In a fronting arrangement, we give selected MGAs authority to act on our behalf to produce, underwrite and administer policies that meet our underwriting and pricing guidelines.
We generally retain 10%-35% of the underwriting risk in our fronting business.
The issuance of our policy makes us contractually responsible to the insured in the event they experience a covered loss.
−Removed: We enter into these arrangements selectively with counterparties which have significant experience and market presence in their desired segment of property-casualty, workers' compensation or automobile business.
+Added: We enter into these arrangements selectively with counterparties which have significant experience and market presence in specialty classes of property-casualty risk, workers' compensation or automobile business.
+Added: We only work with MGAs who permit us to actively engage with them through a combination of onsite and offsite resources to facilitate our real-time supervision of their work.
Underwriting, claims and financial performance is subject to regular review by our staff, and we hold appropriate collateral to manage counterparty credit risk.
−Removed: We specifically grant limited authority for underwriting and claims administration and employ a rigorous review process to ensure the authority is appropriately used within the terms of our contract, and that collateral held by us is appropriate as determined by our personnel.
+Added: We grant limited authority for underwriting and claims administration and employ a rigorous review process to ensure the authority is appropriately used within the terms of our contract, and that collateral held by us is appropriate.
We charge fees as a percentage of gross written premiums for issuing these policies.
−Removed: We establish fronting opportunities through a variety of sources, including direct carrier relationships, MGAs and reinsurance brokers.
−Removed: Due to our broad licensure and product filings, we are positioned to support this business on a broad basis throughout the United States.
+Added: We establish fronting opportunities through a variety of sources, including direct carrier relationships, MGAs, reinsurers, and reinsurance brokers.
+Added: Due to our licensure and product filings, we are positioned to support this business throughout the United States.
Because of the more limited capital allocation required to support it, we believe the fronting business represents an efficient use of capital, and we continued to expand this business in 2022.
−Removed: Two fronting agencies produced $124.1 million (Atlas General Insurance Services) and $89.5 million of gross written premiums in 2021, representing 8.2% and 5.9% of consolidated gross written premiums and 25.2% and 18.2% of the Specialty Admitted Insurance segment's gross written premiums, respectively.
−Removed: Our fronting business saw growth related to new fronting relationships added since January 1, 2020 that generated $105.2 million and $35.0 million of gross written premium in the years ended December 31, 2021 and 2020, respectively.
−Removed: Our objective over time is to utilize the combination of fee income and underwriting profits from our Specialty Admitted Insurance segment to leverage our capital and improve returns on tangible equity.
−Removed: Additionally, we expect that this fee income, which was $22.7 million in 2021, $19.3 million in 2020, and $15.8 million in 2019, may be increasingly material in future periods and provide us with a steady revenue stream.
−Removed: In a fronting arrangement, we give selected MGAs authority to act on our behalf to produce, underwrite and administer policies that meet our strict underwriting and pricing guidelines.
−Removed: We enter into these arrangements selectively with agents who have significant experience and market presence in specialty classes of property-casualty risks.
−Removed: Underwriting, claims and financial performance is subject to regular review by our staff.
−Removed: We only work with MGAs who permit us to actively engage with them through a combination of onsite and offsite resources to facilitate our real-time supervision of their work.
−Removed: We specifically grant limited authority for underwriting and claims administration and employ a rigorous review process to ensure the authority is appropriately used.
+Added: Our two largest fronting agencies produced $120.9 million and $110.9 million of gross written premiums in 2022, representing 8.1% and 7.4% of consolidated gross written premiums and 24.7% and 22.6% of the Specialty Admitted Insurance segment's gross written premiums, respectively.
+Added: Our objective is to utilize the combination of fee income and underwriting profits from our Specialty Admitted Insurance segment to leverage our capital and improve returns on tangible equity.
+Added: Fee income was $23.6 million in 2022, $22.7 million in 2021, and $19.3 million in 2020.
We focus our coverage on casualty risks in our fronting business, although some property insurance is written.
2 unchanged sentences
Under the terms of these program agreements, we pay fixed commissions, often with a profit contingency.
−Removed: Our fronting business is distributed primarily through MGAs and program managers.
−Removed: Excluding our Atlas program, we have seventeen active fronting arrangements as of December 31, 2021.
−Removed: During 2021, these arrangements represented 62.4% of the segment’s gross written premium.
+Added: Our fronting business is distributed primarily through MGAs and fronting and program managers.
+Added: Traditional Workers’ Compensation Business
+Added: Our individual risk workers’ compensation business, produced through a distribution channel comprised of appointed independent retail agents and a limited number of appointed wholesale brokers, remains a regionally focused effort mainly in select Southeastern U.S.
+Added: We made the strategic decision in 2020 to focus our efforts towards the Southeast, and to substantially reduce our presence in other states.
+Added: This decision was based upon a wide range of factors, including ability to exceed internal performance metrics, regulations regarding pricing and claim cost containment, and our agent relationships.
+Added: For the year ended December 31, 2022, approximately 39% of our retail produced workers’ compensation direct written premiums were in North Carolina, 18% were in Georgia, 17% were in Missouri, and 10% were in Virginia.
+Added: Building trades represented approximately 31% of the direct premiums in force in our retail produced workers’ compensation book in 2022.
+Added: Other significant industry groups include specialty transportation (14%), healthcare employees (13%), goods and services (13%), manufacturing (13%), and agriculture (9%).
+Added: We recognize the cyclical nature of this line and are prepared to contract the business rapidly when rates decline, or the regulatory or economic environment makes it difficult to adequately price this business or contain claim costs.
Casualty Reinsurance Segment
7 unchanged sentences
On a premium volume basis, treaties written as “proportional” arrangements represented 98.1% of the third-party net written premiums during 2022 and treaties with loss mitigation features including sliding scale ceding commissions represented 40.6%.
−Removed: We purchase very little retrocessional
−Removed: coverage in this segment.
+Added: We purchase very little retrocessional coverage in this segment.
Almost all of the segment’s premiums are for casualty lines of business.
6 unchanged sentences
At December 31, 2022, JRG Re invested assets made up 33.2% of our total invested assets.
+Added: In keeping with our previously announced plans to significantly shrink top-line writings of the Casualty Reinsurance segment, we have decided to suspend writing business in the Casualty Reinsurance segment, as we continue our focus on growing our higher returning U.S.
+Added: insurance and fronting businesses.
+Added: We expect the Casualty Reinsurance segment to continue earning premium due to the nature of the earnings patterns in the reinsurance business, which can extend over multiple years.
+Added: Aside from the suspension of underwriting activities, we plan for the Casualty Reinsurance segment to maintain its normal day-
+Added: to-day operations, with a staff to continue servicing the business on its books and to facilitate compliance with its regulatory requirements.
Corporate and Other Segment
18 unchanged sentences
The Excess and Surplus Lines segment may retain up to $5.0 million per risk on our excess property book;
−Removed: however, the average retained amount per risk is approximately $1.6 million.
+Added: however, the average retained amount per risk is approximately $862,000.
In our Specialty Admitted Insurance segment, we focus on casualty business, but we do write a limited amount of property insurance, principally through our fronting and programs business.
4 unchanged sentences
We buy such high limits because we believe the property catastrophe models are less accurate when applied to small books of business like ours than when applied to larger portfolios.
−Removed: Where the Specialty Admitted Insurance segment incurs incidental property risks in its program book of business, the segment has purchased coverage for $4.0 million in excess of $1.0 million per occurrence, in addition to the protection provided under the corporate $40.0 million in excess of $5.0 million catastrophe treaty.
+Added: Where the Specialty Admitted Insurance segment incurs incidental property risks in its fronting and program book of business, the segment has purchased coverage for $4.0 million in excess of $1.0 million per occurrence, in addition to the protection provided under the corporate $60.0 million in excess of $5.0 million catastrophe treaty.
This is also intended to cover the 1 in 1,000 year modeled aggregate PML on any property exposures the Specialty Admitted Insurance segment assumes.
In our Casualty Reinsurance segment, we believe that our maximum loss from a catastrophic event is approximately $2.0 million and, as a result, we do not currently purchase retrocessional reinsurance coverage for property-catastrophe risks.
−Removed: We believe our pre-tax group-wide PML from a 1 in 1,000 year catastrophic event would not exceed 2.5% of shareholders’ equity, inclusive of reinstatement premiums payable.
+Added: We believe our pre-tax group-wide PML from a 1 in 1,000 year catastrophic event would not exceed 2.5% of shareholders’ equity, inclusive of reinstatement premiums payable and net retentions.
Purchased Casualty Reinsurance
In our Excess and Surplus Lines segment, there are five divisions where we only write $1.0 million per occurrence limits (Commercial Auto, Manufacturers and Contractors, General Casualty, Small Business and Sports and Entertainment), and therefore, we do not purchase any specific reinsurance for these policies.
−Removed: In the other divisions, where we issue policies with larger limits, we purchase reinsurance in excess of $1.0 million per occurrence.
+Added: In the other divisions, where we issue policies with larger limits, we purchase reinsurance in excess of $1.0 million or $2.0 million per occurrence.
In our Specialty Admitted Insurance segment, there are two distinct reinsurance strategies.
−Removed: For individual risk workers' compensation, we purchase $29.0 million excess of $1.0 million per occurrence;
−Removed: and, effective January 1, 2020, we also purchased a 70% quota share coverage of the primary $1.0 million.
+Added: For individual risk workers' compensation, we purchase $29.0 million excess of $1.0 million per occurrence, and we purchase 65.5% quota share coverage of the primary $1.0 million.
For our fronting and program business, we purchase proportional reinsurance and excess of loss reinsurance to limit our exposure to no more than $750,000 per occurrence.
−Removed: For both our Excess and Surplus Lines segment and our Specialty Admitted Insurance segment, we purchase a contingency clash reinsurance treaty that covers all casualty business for $10.0 million in excess of $2.0 million per occurrence.
−Removed: This coverage is intended to respond in a situation where we have multiple insured losses from the same event as well as extra contractual obligations or excess policy limits on an individual occurrence basis.
+Added: In prior years, for both our Excess and Surplus Lines segment and our Specialty Admitted Insurance segment, we purchased a contingency clash reinsurance treaty that covered all casualty business for $10.0 million in excess of $2.0 million per occurrence.
+Added: This coverage, which was put into runoff effective July 1, 2022, was intended to respond in situations with multiple insured losses from the same event as well as extra contractual obligations or excess policy limits on an individual occurrence basis.
+Added: As of December 31, 2022, our average net retained limit per risk is $2.5 million.
Effective January 1, 2020, we purchased an additional $10.0 million in claims made coverage for excess policy limits and extra contractual obligations exposures above the clash and contingency treaty for the period 2014 to present.
+Added: This treaty has one reinstatement and expired on December 31, 2022.
In our Casualty Reinsurance segment, we currently purchase quota share retrocessional reinsurance in support of an individual assumed treaty where an expense override is achieved.
1 unchanged sentence
For 2022, our top ten reinsurers represented 71.6% of our total ceded reinsurance recoverables, and all of these reinsurance recoverables were from reinsurers with an A.M.
−Removed: Best rating of “A+” (Superior), are collateralized with letters of credit or by a trust agreement, or represent recoverables from a state residual market for automobile insurance.
+Added: Best rating of “A+” (Superior) or better, or are collateralized with letters of credit or by a trust agreement.
The following table sets forth our ten most significant reinsurers by amount of reinsurance recoverables on unpaid losses and the amount of reinsurance recoverables pertaining to each such reinsurer as well as its A.M.
6 unchanged sentences
Swiss Reinsurance America Corporation $ 340,393 A+
−Removed: Aleka Insurance Company 256,452 Unrated (1)
+Added: Fortitude Re (Casualty Re LPT) 244,657 A
+Added: Aleka Insurance Company (Commercial Auto LPT) 132,049 Unrated (1)
Berkley Insurance Company 130,860 A+
−Removed: Safety National Casualty 47,916 A++
−Removed: Aioi Nissay Dowa Insurance Company 47,341 A+
Hannover Ruck SE 50,764 A+
+Added: Safety National Casualty 46,769 A++
Endurance Assurance Corporation 45,300 A+
−Removed: Munich Reinsurance America 34,612 A+
American European Insurance Company 38,891 B (2)
−Removed: North Carolina Reinsurance Facility 26,995 Unrated (3)
+Added: Munich Reinsurance America 33,699 A+
+Added: Aioi Nissay Dowa Insurance Company 25,583 A+
Top 10 Total 1,088,965
5 unchanged sentences
All material reinsurance recoverable amounts from this reinsurer are collateralized.
−Removed: (3) The North Carolina Reinsurance Facility is a residual market mechanism for automobile insurance in North Carolina.
Amounts Recoverable from an Indemnifying Party and Reinsurer on Legacy Commercial Auto Book
1 unchanged sentence
James River has indemnity agreements with Rasier (non-insurance entities) (collectively, the “Indemnity Agreements”) and is contractually entitled to reimbursement for the portion of the losses and loss adjustment expenses paid on behalf of Rasier under the Rasier Commercial Auto Policies and other expenses incurred by James River.
−Removed: On September 27, 2021, James River entered into a loss portfolio transfer reinsurance agreement (the “LPT Agreement”) with Aleka to reinsure substantially all of the Rasier Commercial Auto Policies for which James River is not otherwise indemnified by Rasier under the Indemnity Agreements.
−Removed: Under the terms of the LPT Agreement, effective as of July 1, 2021, James River ceded to Aleka approximately $345.1 million of commercial auto liabilities relating to Rasier Commercial Auto Policies written in the years 2013-2019, which amount constituted the reinsurance premium.
−Removed: Each of Rasier and Aleka are required to post collateral under the Indemnity Agreements and the LPT Agreement, respectively:
−Removed: • Pursuant to the Indemnity Agreements, Rasier is required to post collateral for the amounts recoverable or that may be recoverable under the Indemnity Agreements, including, among other things, case loss and loss adjustment expense reserves, IBNR loss and loss adjustment expense reserves, extra contractual obligations and excess policy limits liabilities.
+Added: On September 27, 2021, James River entered into the Commercial Auto LPT with Aleka to reinsure substantially all of the Rasier Commercial Auto Policies for which James River is not otherwise indemnified by Rasier under the Indemnity Agreements.
+Added: Under the terms of the Commercial Auto LPT, effective as of July 1, 2021, James River ceded to Aleka approximately $345.1 million of commercial auto liabilities relating to Rasier Commercial Auto Policies written in the years 2013-2019, which amount constituted the reinsurance premium.
+Added: For the year ended December 31, 2022, due to adverse paid loss trends on the legacy Rasier business, the Company recognized adverse prior year development of $46.7 million on the reserves subject to the Commercial Auto LPT, bringing the cumulative amount ceded under the Commercial Auto LPT to $391.8 million at December 31, 2022.
+Added: Each of Rasier and Aleka are required to post collateral under the Indemnity Agreements and the Commercial Auto LPT:
+Added: • Pursuant to the Indemnity Agreements, Rasier is required to post collateral equal to 102% of James River's estimate of the amounts that are recoverable or may be recoverable under the Indemnity Agreements, including, among other things, case loss and loss adjustment expense reserves, IBNR loss and loss adjustment expense reserves, extra contractual obligations and excess policy limits liabilities.
The collateral is provided through a collateral trust arrangement (the “Indemnity Trust”) in favor of James River by Aleka.
−Removed: In connection with the execution of the LPT Agreement, James River returned $691.3 million to the Indemnity Trust, representing the remaining balance of the amount withdrawn in October 2019, as was permitted under the indemnification agreements with Rasier and the associated trust agreement.
+Added: In connection with the execution of the Commercial Auto LPT, James River returned $691.3 million to the Indemnity Trust, representing the remaining balance of the amount withdrawn in October 2019, as was permitted under the indemnification agreements with Rasier and the associated trust agreement.
At December 31, 2022, the balance in the Indemnity Trust was $267.0 million, and, together with the balance of the Loss Fund Trust (as defined below) attributable to the Indemnity Agreements as described below, the total balance of collateral securing Rasier’s obligations under the Indemnity Agreements was $336.2 million.
−Removed: • Pursuant to the LPT Agreement, Aleka is required to post collateral equal to 102% of James River's estimate of Aleka's obligations under the LPT Agreement, calculated in accordance with statutory accounting principles.
+Added: • Pursuant to the Commercial Auto LPT, Aleka is required to post collateral equal to 102% of James River's estimate of Aleka's obligations under the Commercial Auto LPT, calculated in accordance with standard actuarial principles and based on reserves recorded in our statutory financial statements.
The collateral is provided through a collateral trust arrangement (the “LPT Trust”) established in favor of James River by Aleka.
−Removed: At December 31, 2021, the balance in the LPT Trust was $251.7 million, and, together with the balance of the Loss Fund Trust (as defined below) attributable to the LPT Agreement as described below, the total balance of collateral securing Aleka’s obligations under the LPT Agreement was $279.9 million.
−Removed: At December 31, 2021, the total reinsurance recoverables under the LPT Agreement was $272.3 million (including $256.5 million of unpaid recoverables and $15.9 million of paid recoverables).
−Removed: In connection with the execution of the LPT Agreement, James River and Aleka entered into an administrative services agreement (the “Administrative Services Agreement”) with a third party claims administrator (the “Administrator”) pursuant to which the Administrator handles the claims on the Rasier Commercial Auto Policies for the remaining life of those claims.
+Added: At December 31, 2022, the balance in the LPT Trust was $121.9 million, and, together with the balance of the Loss Fund Trust (as defined below) attributable to the Commercial Auto LPT as described below, the total balance of collateral securing Aleka’s obligations under the Commercial Auto LPT was $150.0 million.
+Added: At December 31, 2022, the total reinsurance recoverables under the Commercial Auto LPT was $145.2 million (including $132.0 million of unpaid recoverables and $13.2 million of paid recoverables).
+Added: In connection with the execution of the Commercial Auto LPT, James River and Aleka entered into an administrative services agreement (the “Administrative Services Agreement”) with a third party claims administrator (the “Administrator”) pursuant to which the Administrator handles the claims on the Rasier Commercial Auto Policies for the remaining life of those claims.
The claims paid by the Administrator are reimbursable by James River, and pursuant to the Administrative Services Agreement, James River established a loss fund trust account for the benefit of the Administrator (the “Loss Fund Trust”) to collateralize its claims payment reimbursement obligations.
−Removed: James River funds the Loss Fund Trust using funds withdrawn from the Indemnity Trust, funds withdrawn from the LPT Trust, and its own funds, in each case in an amount equal to the pro rata portion of the required Loss Fund Trust balance attributable to the Indemnity Agreements, the LPT Agreement and James River’s existing third party reinsurance agreements, respectively.
−Removed: At December 31, 2021, the balance in the Loss Fund Trust was $102.0 million, including $69.2 million of which represented collateral supporting Rasier’s obligations under the Indemnity Agreements and $28.2 million of which represented collateral supporting Aleka’s obligations under the under the LPT Agreement.
+Added: James River funds the Loss Fund Trust using funds withdrawn from the Indemnity Trust, funds withdrawn from the LPT Trust, and its own funds, in each case in an amount equal to the pro rata portion of the required Loss Fund Trust balance attributable to the Indemnity Agreements, the Commercial Auto LPT and James River’s existing third party reinsurance agreements, respectively.
+Added: At December 31, 2022, the balance in the Loss Fund Trust was $103.2 million, including $69.2 million representing collateral supporting Rasier’s obligations under the Indemnity Agreements and $28.2 million representing collateral supporting Aleka’s obligations under the Commercial Auto LPT.
Funds posted to the Loss Fund Trust are classified as restricted cash equivalents on the Company's balance sheet.
−Removed: While the LPT Agreement brings economic finality to substantially all of the Rasier Commercial Auto Policies, the Company has credit exposure to Rasier and Aleka under the Indemnity Agreements and the LPT Agreement if the estimated losses and expenses of the Rasier Commercial Auto Policies grow at a faster pace than the growth in our collateral balances.
−Removed: In addition, we have credit exposure if our estimates of future losses and loss adjustment expenses and other amounts recoverable under the Indemnity Agreements and the LPT Agreement, which are the basis for establishing the collateral balances, are lower than actual amounts paid or payable.
+Added: While the Commercial Auto LPT brings economic finality to substantially all of the Rasier Commercial Auto Policies, the Company has credit exposure to Rasier and Aleka under the Indemnity Agreements and the Commercial Auto LPT if the estimated losses and expenses of the Rasier Commercial Auto Policies grow at a faster pace than the growth in our collateral balances.
+Added: In addition, we have credit exposure if our estimates of future losses and loss adjustment expenses and other amounts recoverable under the Indemnity Agreements and the Commercial Auto LPT, which are the basis for establishing the collateral balances, are lower than actual amounts paid or payable.
The amount of our credit exposure in any of these instances could be material.
−Removed: To mitigate these risks, we closely and frequently monitor our exposure compared to our collateral held, and we request additional collateral when our analysis indicates that we have uncollateralized exposure.
+Added: To mitigate these risks, we closely and frequently monitor our exposure compared to our collateral held, and we request additional collateral in accordance with the terms of the Commercial Auto LPT and Indemnity Agreements when our analysis indicates that we have uncollateralized exposure.
Reserve Policy
1 unchanged sentence
All of our reserving actuaries are credentialed and our Chief Actuary has 38 years of industry experience.
−Removed: We engage independent actuarial consultants to review our decisions regarding reserves.
+Added: We engage independent actuarial consultants to perform independent valuations to corroborate our decisions regarding reserves.
Anticipated inflation is reflected implicitly in the reserving process through analysis of cost trends and the review of historical development.
26 unchanged sentences
These estimates are by their nature subjective and imprecise, and ultimate losses and loss adjustment expenses may vary from established reserves.
−Removed: Our Reserve Committees consist of our Chief Actuary, Chief Executive Officer, Chief Financial Officer, and Chief Accounting Officer.
−Removed: Additionally, the presidents, chief financial officers and chief actuaries of each of our three insurance segments are also members of the Reserve Committee for their respective segments.
−Removed: The Reserve Committees meet quarterly to review the actuarial recommendations made by each chief actuary and use their best judgment to determine the best estimate to be recorded for the reserve for losses and loss adjustment expenses on our quarterly balance sheet.
+Added: Our Reserve Committee consists of our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, and Chief Actuary.
+Added: Additionally, the presidents, chief financial officers and segment actuaries of each of our three insurance segments participate in the Reserve Committee meetings for their respective segments.
+Added: The Reserve Committee meets quarterly to review the actuarial recommendations made by each segment actuary and use their best judgment to determine the best estimate to be recorded for the reserve for losses and loss adjustment expenses on our balance sheet.
The Company also engages an independent internationally recognized actuarial consulting firm to review the Company’s reserve estimates in the third and fourth quarters of each year.
32 unchanged sentences
This adverse development was mainly in the general liability and commercial auto lines of business.
−Removed: (9) Includes $9.0 million of adverse development on assumed crop business and $7.6 million of adverse development on other assumed business.
Among the indicators of reserve strength that we monitor closely is the amount of IBNR reserves held on our balance sheet for claims that have been incurred but not yet reported.
33 unchanged sentences
Investment Strategy
+Added: Our investment strategy seeks to generate stable investment income and contributions to growth in tangible equity, while providing sufficient liquidity to meet our claims and other obligations.
We attempt to generate better than market average risk-adjusted returns in our investment portfolio by taking measured risks based upon detailed knowledge of certain niche asset classes.
1 unchanged sentence
The vast majority of our investment portfolio is managed by third party, independent investment managers.
−Removed: The majority of our investment portfolio is invested in what we refer to as our Core Portfolio of investment grade fixed income securities.
−Removed: This portfolio provides predictable income with low risk of principal loss.
−Removed: We seek to augment the return on the Core Portfolio by investing in bank loans and other higher yielding securities, including dividend paying common equities and private investments.
−Removed: We designed these strategies to improve our investment return, and we are focused on opportunistic investing in areas where we believe our management, directors or employees have expertise or appropriate understanding of the risk and return of the investment.
+Added: The majority of our investment portfolio is invested in investment grade fixed income securities.
+Added: This portfolio provides predictable income with low risk of principal loss and strong liquidity.
+Added: We seek to augment our overall return and income by investing in bank loans and other higher yielding assets, including equity securities and private investments.
+Added: We designed these strategies to improve our investment return, and we are focused on opportunistic investing in areas where we believe our management has expertise or an appropriate understanding of the risk and return of the investment.
Our strategy is designed to earn higher returns than an investment grade fixed income approach alone while maintaining a high average portfolio credit rating and investing in asset classes and allocations that are consistent with the insurance regulatory and rating agency framework within which we operate.
−Removed: We generally focus on securities that provide some current income.
−Removed: As a result of affiliated and third party reinsurance contracts, we have a significant asset base at JRG Reinsurance Company Ltd, which is domiciled in Bermuda and is not subject to U.S.
−Removed: corporate taxation.
−Removed: At December 31, 2021, 41.2% of our invested assets were held at JRG Re.
−Removed: A summary of our investment portfolio at December 31, 2021 is as follows:
+Added: We have generally managed our overall portfolio to a duration of 3 to 5 years.
+Added: At December 31, 2022, the average duration of our total invested assets and cash, excluding restricted cash, was 4.1 years.
+Added: A summary of our cash and invested assets, excluding restricted cash equivalents, at December 31, 2022 is as follows:
December 31, 2022
1 unchanged sentence
($ in thousands)
−Removed: Core $ 1,790,527 $ 1,824,319 $ 1,824,319 2.14 % 83.9 %
−Removed: Bank Loans 181,332 179,585 179,585 6.57 % 8.3 %
−Removed: Incremental Yield 103,005 116,821 116,821 6.18 % 5.4 %
−Removed: Private Investments 51,908 NA 2.4 %
−Removed: Total 2,172,633 100.0 %
−Removed: Less cash and cash equivalents in Core and Bank Loans (42,148)
+Added: Fixed maturity and preferred stock $ 2,038,521 $ 1,854,248 $ 1,854,248 3.2 % 78.4 %
+Added: Bank loan participations 171,320 154,991 154,991 5.8 % 6.6 %
+Added: Common stock 48,431 47,796 47,796 NA 2.0 %
+Added: Short-term investments 107,812 107,812 107,812 4.3 % 4.5 %
+Added: Other invested assets 27,447 27,447 27,447 NA 1.2 %
Total invested assets 2,192,294 92.7 %
−Removed: We have generally managed our overall portfolio to a duration of 3 to 5 years.
−Removed: At December 31, 2021, the average duration of our investment portfolio was 4.0 years.
−Removed: Core Portfolio
−Removed: The Core Portfolio consists of cash, investment grade fixed income securities and a small dividend yield focused equity portfolio.
−Removed: Our objective in the Core Portfolio is to earn attractive risk-adjusted returns with a low risk of loss of principal.
−Removed: We use a third-party manager to manage the Core Portfolio.
+Added: Cash and cash equivalents 173,164 7.3 %
+Added: Total invested assets and cash $ 2,365,458 100.0 %
+Added: Fixed maturity and preferred stock investments primarily consist of investment grade fixed income and preferred stock securities, which make up 78.4% of total invested assets and cash.
+Added: Common stock investments primarily consist of dividend yield focused equity holdings and are 2.0% of total invested assets and cash.
+Added: Our objective with fixed maturity, preferred stock and common stock investments is to earn attractive risk-adjusted returns with a low risk of loss of principal, while earning attractive income.
The Bank Loan portfolio primarily consists of investments in participations in syndicated bank loans, but may also include a small allocation of bonds.
−Removed: Bank loans in our portfolio are generally senior secured loans with an average credit quality of “B” as of December 31, 2021 and floating interest rates based on spreads over LIBOR.
+Added: Bank loans in our portfolio are generally senior secured loans with an average credit quality of “B” as of December 31, 2022 and floating interest rates based on spreads over LIBOR or SOFR.
We believe bank loans are an attractive asset class because (1) floating-rate loans help to reduce our risk of loss in the event of rising interest rates, (2) the loans are generally senior secured, (3) the asset class has a history of relatively high recovery rates in the event of default, (4) the portfolio provides an attractive yield and (5) the maturities of the loans are relatively short (average of approximately 5 years).
We invest in this asset class by owning individual loan participations that are carried at fair market value.
−Removed: We have over ten years of experience in investing in this asset class through a third-party manager.
−Removed: Incremental Yield Portfolio
−Removed: The Incremental Yield Portfolio consists of investments in low investment grade and below investment grade bonds, preferred stocks, dividend paying common equities and exchange traded funds.
−Removed: The average credit quality of the fixed income securities in this portfolio as of December 31, 2021 is BBB.
−Removed: We generally invest in fixed income securities where we believe that risk of default is low relative to the potential yield on the securities.
−Removed: We own preferred stocks, generally in the financial services industry.
−Removed: In some instances, we will purchase exchange traded funds.
−Removed: However, these purchases are generally used as an effective means to get access to a high yielding asset class.
−Removed: Private Investment Portfolio
−Removed: We make selective investments in private debt or equity securities in areas where we see significant opportunity or attractive risk and return characteristics.
+Added: As of December 31, 2022, bank loans totaled 6.6% of total invested assets and cash.
+Added: Other Invested Assets
+Added: We make selective investments in private debt or equity securities in areas where we see opportunity or attractive risk and return characteristics.
We focus on investments where we believe we have an understanding of the risk and opportunity and have the ability to monitor them closely.
At December 31, 2022, we held 10 private investments with a total carrying value of $27.4 million.
−Removed: Our portfolio consists of investments in wind and solar energy, banking, small cap equities, loans of middle market private equity sponsored companies, and tranches of distressed home loans.
+Added: Our portfolio consists of investments in wind and solar energy, banking, small cap equities, loans of middle market private equity sponsored companies, asset management firms and other investments.
We are opportunistic in our private investment strategy and our portfolio may grow or shrink based on the opportunities available to us.
−Removed: Despite being only 2.4% of our portfolio, we believe our Private Investment Portfolio has added meaningful returns to our tangible equity.
−Removed: Our Private Investment strategy has significant risk and not all investments are successful.
+Added: Our other invested asset strategy has significant risk and not all investments are successful.
As a result, we intentionally keep this portfolio as a small portion of the overall investment portfolio.
−Removed: Our recent total returns on our portfolio are as follows:
−Removed: 2019 2020 2021 Trailing 3 years
−Removed: Core 6.80 % 5.74 % (0.40) % 3.87 %
−Removed: Bank Loans 3.56 % 7.46 % 10.74 % 7.21 %
−Removed: Incremental 14.34 % 5.64 % 5.83 % 8.53 %
−Removed: Total 6.87 % 5.88 % 0.76 % 4.31 %
−Removed: Total returns are calculated as the realized or unrealized gain or loss of an asset plus interest and dividends paid while the asset is held.
−Removed: We consider a portion of our investment portfolio to be invested in non-traditional investments.
−Removed: We consider non-traditional investments to include investments that are (1) not rated fixed income securities (2) non-listed equities or (3) investments that generally have less liquidity than rated fixed income securities or listed equities.
−Removed: Non-traditional investments held at December 31, 2021 and their respective percentage of our total cash and invested assets (excluding restricted cash equivalents) at such date consist of syndicated bank loans (6.7%) and private investments (2.2%).
−Removed: We will continue to actively review opportunities to invest in non-traditional assets and may invest in additional non-traditional assets in the future.
−Removed: Our invested assets totaled $2,130.5 million as of December 31, 2021.
+Added: As of December 31, 2022, other invested assets totaled 1.2% of total invested assets and cash.
+Added: Our total invested assets and cash totaled $2,365.5 million as of December 31, 2022.
The weighted average credit rating of our portfolio of fixed maturity securities, bank loans and preferred stocks as of December 31, 2022 was “A”.
−Removed: We have intentionally maintained a cautious interest rate risk position by having an average duration of 4.0 years at December 31, 2021.
+Added: We have intentionally maintained a cautious interest rate risk position by having an average duration for our total invested assets and cash, excluding restricted cash, of 4.1 years at December 31, 2022.
This compares to an average duration at December 31, 2021 of 4.0 years.
−Removed: Based on the current duration of 4.0 years, a 1.0% increase in interest rates would result in a pre-tax decline in the market value of our portfolio of approximately $83.8 million.
+Added: Based on the current duration of 4.1 years, a 1.0% increase in interest rates would result in a pre-tax decline in the market value of our portfolio, excluding other invested assets and cash, of approximately $88.8 million.
Insurance Cycle Management and Growth
4 unchanged sentences
There is generally a correlation between interest rates and the willingness of insurance companies to commit their capital to writing insurance.
−Removed: When fixed income yields are low, insurance companies need to raise insurance prices to improve underwriting results in order to offset loss of investment income.
+Added: When fixed income yields are low, insurance companies may need to raise insurance prices to improve underwriting results in order to offset loss of investment income.
We are currently in a growth phase for our U.S.
1 unchanged sentence
In both our Excess and Surplus Lines and Specialty Admitted Insurance segments, we are experiencing growth in premiums driven by favorable rates as well as increases in policy count and exposures.
−Removed: The growth in the Excess and Surplus Lines segment was impacted by the termination of our insurance contracts with Rasier effective December 31, 2019.
−Removed: The Rasier account generated $374.2 million of gross written premium in 2019, but none in 2020 and 2021.
+Added: In 2020, the growth in the Excess and Surplus Lines segment was impacted by the termination of our insurance contracts with Rasier effective December 31, 2019.
+Added: The Rasier account generated $374.2 million of gross written premium in 2019, but none in 2020 through 2022.
Excluding Rasier, E&S gross written premium increased 27.5% in 2020, from $548.2 million in 2019 to $699.1 million in 2020.
14 unchanged sentences
The Excess and Surplus Lines segment has historically been able to make an underwriting profit regardless of the state of the underwriting cycle.
−Removed: This segment's weighted average combined ratio for 2012 through 2021 is 95.2%.
+Added: This segment's cumulative combined ratio for 2013 through 2022 is 94.1%.
Traditionally, admitted insurance lines have been very susceptible to market cycles.
7 unchanged sentences
We compete in a variety of markets against a variety of competitors depending on the nature of the risk and coverage being underwritten.
−Removed: The competition for any one account may range from large international firms to smaller regional companies in the domiciles in which we operate.
+Added: The competition for any one account may range from large international firms to smaller regional companies or group captives in the domiciles in which we operate.
To remain competitive, our strategy includes, among other measures:
4 unchanged sentences
The Excess and Surplus Lines segment may also compete with national and regional carriers from the standard market willing to underwrite selected accounts on an admitted basis.
−Removed: Competitors in this segment include ACE Westchester Specialty Group, AmRisc Insurance Company (Truist), Apollo Syndicate, Alleghany Corporation, Arrowhead General Insurance Agency, Inc., Ategrity Specialty Insurance Company, Axis Insurance Company (Axis Capital Holdings Limited), Beazley Group (Lloyd’s), Brit Insurance (Lloyd’s), Colony Specialty Insurance Company (Argo Group International Holdings, Ltd.), Fairfax Financial Holdings, Ltd., Hiscox Insurance Company (Lloyd’s), Houston Casualty Company (a subsidiary of Tokio Marine HCC), Kinsale Capital Group, Lexington Insurance Company (American International Group, Inc.), Markel Corporation, Navigators Insurance Company (Hartford), OneBeacon (Intact Financial Corporation), QBE Insurance Group Ltd., RLI Corp., E&S/Specialty (Nationwide Mutual Group), Starr Insurance Company (C.V.
+Added: Competitors in this segment include ACE Westchester Specialty Group (Chubb), AmRisc Insurance Company (Truist), Apollo Syndicate, Alleghany Corporation (Berkshire Hathaway), Arrowhead General Insurance Agency, Inc., Ategrity Specialty Insurance Company, Axis Insurance Company (Axis Capital Holdings Limited), Beazley Group (Lloyd’s), Brit Insurance (Lloyd’s), Colony Specialty Insurance Company (Argo Group International Holdings, Ltd.), Fairfax Financial Holdings, Ltd., Hiscox Insurance Company (Lloyd’s), Houston Casualty Company (a subsidiary of Tokio Marine HCC), Kinsale Capital Group, Inc., Lexington Insurance Company (American International Group, Inc.), Markel Corporation,
+Added: Navigators Insurance Company (Hartford), OneBeacon (Intact Financial Corporation), QBE Insurance Group Ltd., RLI Corp., E&S/Specialty (Nationwide Mutual Group), Starr Insurance Company (C.V.
Starr & Company), Swiss Re Ltd, United Specialty Insurance Company, W.R.
Berkley, and other large national and multi-national insurance carriers.
−Removed: In addition, in the last twelve months, there are several newly formed or repurposed start-up companies that are focusing on writing Excess and Surplus lines insurance and we expect will be competing with us for this business.
Specialty Admitted Insurance
Due to the diverse nature of the products offered by the Specialty Admitted Insurance segment, competition comes from various sources.
−Removed: The majority of the competition for our workers’ compensation business comes from regional companies or regional subsidiaries of national carriers in the domiciles in which they operate.
National carriers tend to compete for fronting and program accounts along all product lines.
+Added: Competition for our fronting business includes but is not limited to State National (now part of Markel), Argo Group, Clear Blue, Spinnaker, Trisura, Red Point, Equity Insurance Company, Worth Insurance, and Amtrust.
+Added: The majority of the competition for our workers’ compensation business comes from regional companies or regional subsidiaries of national carriers in the domiciles in which they operate.
Competitors in our workers’ compensation business include Builders Mutual Insurance Company, Accident Fund Insurance Company of America, W.
Berkley Corporation, American Interstate Insurance Company (AMERISAFE, Inc.), and Amtrust Group.
−Removed: Competition for our fronting business includes but is not limited to State National (now part of Markel), Argo Group, Clear Blue, Spinnaker, Trisura, Red Point, Equity Insurance Company, Worth Insurance, and Amtrust.
−Removed: In addition, in the last 12 months, there are several newly formed fronting companies that we expect will be competing with us for this business.
Casualty Reinsurance
3 unchanged sentences
casualty reinsurance.
−Removed: In addition, in the last 12 months, there are several newly formed reinsurance companies that are planning on writing casualty reinsurance and we expect will be competing with us for this business.
Bermuda Insurance Regulation
−Removed: The Insurance Act 1978 and related rules and regulations (the “Insurance Act”), which regulates the insurance business of both Carolina Re and JRG Re, provides that no person shall carry on insurance business in or from within Bermuda unless registered as an insurer under the Insurance Act by the Bermuda Monetary Authority (the “BMA”).
+Added: The Insurance Act 1978 and related rules and regulations (the “Insurance Act”), which regulates the insurance business of JRG Re, provides that no person shall carry on insurance business in or from within Bermuda unless registered as an insurer under the Insurance Act by the Bermuda Monetary Authority (the “BMA”).
The BMA, in deciding whether to grant registration, has broad discretion to act as it thinks fit in the public interest.
9 unchanged sentences
The Insurance Act imposes solvency and liquidity standards on Bermuda insurance companies, as well as auditing and reporting requirements.
−Removed: Certain significant aspects of the Bermuda insurance regulatory framework applicable to Class 3A insurers and/or Class 3B insurers are set forth below.
+Added: Certain significant aspects of the Bermuda insurance regulatory framework applicable to Class 3B insurers are set forth below.
Classification of Insurers
1 unchanged sentence
There are several classifications of insurers carrying on general business, ranging from Class 1 insurers (pure captives) to Class 4 insurers (large commercial underwriters).
−Removed: Carolina Re is licensed as a Class 3A insurer and JRG Re is licensed as a Class 3B insurer and each is regulated as such under the Insurance Act.
+Added: JRG Re is licensed as a Class 3B insurer and is regulated as such under the Insurance Act.
Minimum Paid-Up Share Capital
−Removed: A Class 3A insurer and a Class 3B insurer are each required to maintain fully paid up share capital of at least $120,000.
+Added: A Class 3B insurer is required to maintain fully paid up share capital of at least $120,000.
Principal Representative and Principal Office
−Removed: A Class 3A insurer and a Class 3B insurer are each required to maintain a principal office and to appoint and maintain a principal representative in Bermuda.
−Removed: For the purposes of the Insurance Act, the principal office of Carolina Re and JRG Re is located at Wellesley House, 2 nd Floor, 90 Pitts Bay Road, Pembroke, HM 08, Bermuda.
+Added: A Class 3B insurer is required to maintain a principal office and to appoint and maintain a principal representative in Bermuda.
+Added: For the purposes of the Insurance Act, the principal office of JRG Re is located at Wellesley House, 2 nd Floor, 90 Pitts Bay Road, Pembroke, HM 08, Bermuda.
Without a reason acceptable to the BMA, an insurer may not terminate the appointment of its principal representative, and the principal representative may not cease to act as such, unless 30 days’ prior notice in writing to the BMA is given of the intention to do so.
2 unchanged sentences
Within 14 days of such notification to the BMA, the principal representative must furnish the BMA with a written report setting out all the particulars of the case that are available to the principal representative.
−Removed: Where there has been a significant loss which is reasonably likely to cause the insurer to fail to comply with its enhanced capital requirement, the principal representative must also furnish the BMA with a capital and solvency return reflecting an
−Removed: enhanced capital requirement prepared using post-loss data.
+Added: Where there has been a significant loss which is reasonably likely to cause the insurer to fail to comply with its enhanced capital requirement, the principal representative must also furnish the BMA with a capital and solvency return reflecting an enhanced capital requirement prepared using post-loss data.
The principal representative must provide this within 45 days of notifying the BMA regarding the loss.
Furthermore, where a notification has been made to the BMA regarding a material change, the principal representative has 30 days from the date of such notification to furnish the BMA with unaudited interim statutory financial statements in relation to such period as the BMA may require, together with a general business solvency certificate in respect of those statements.
−Removed: A Class 3A insurer and a Class 3B insurer shall each maintain its head office in Bermuda.
+Added: A Class 3B insurer shall maintain its head office in Bermuda.
In determining whether the insurer satisfies this requirement, the BMA shall consider, inter alia , the following factors:
7 unchanged sentences
Loss Reserve Specialist
−Removed: A Class 3A insurer and a Class 3B insurer are each required to appoint an individual approved by the BMA to be its loss reserve specialist.
+Added: A Class 3B insurer is required to appoint an individual approved by the BMA to be its loss reserve specialist.
In order to qualify as an approved loss reserve specialist, the applicant must be an individual qualified to provide an opinion in accordance with the requirements of the Insurance Act and the BMA must be satisfied that the individual is fit and proper to hold such an appointment.
−Removed: A Class 3A insurer and a Class 3B insurer are each required to submit annually an opinion of its approved loss reserve specialist with its capital and solvency return in respect of its total general business insurance technical provisions (i.e.
+Added: A Class 3B insurer is required to submit annually an opinion of its approved loss reserve specialist with its capital and solvency return in respect of its total general business insurance technical provisions (i.e.
the aggregate of its net premium provisions, net loss and loss expense provisions and risk margin, as each is reported in the insurer’s statutory economic balance sheet).
1 unchanged sentence
Annual Financial Statements
−Removed: A Class 3A insurer and Class 3B insurer are each required to prepare and submit to the BMA, on an annual basis, audited financial statements which have been prepared under generally accepted accounting principles or international financial reporting standards (“GAAP financial statements”) and audited statutory financial statements.
+Added: A Class 3B insurer is required to prepare and submit to the BMA, on an annual basis, audited financial statements which have been prepared under generally accepted accounting principles or international financial reporting standards (“GAAP financial statements”) and audited statutory financial statements.
The Insurance Act prescribes rules for the preparation and substance of statutory financial statements (which include, in statutory form, a balance sheet, an income statement, a statement of capital and surplus and notes thereto).
−Removed: The statutory financial statements include detailed information and analysis regarding premiums, claims, reinsurance and investments of the insurer.
+Added: The statutory
+Added: financial statements include detailed information and analysis regarding premiums, claims, reinsurance and investments of the insurer.
The insurer’s annual GAAP financial statements, and the auditor’s report thereon, and the statutory financial statements are required to be filed with the BMA within four months from the end of the relevant financial year (unless specifically extended with the approval of the BMA).
1 unchanged sentence
Declaration of Compliance
−Removed: At the time of filing its statutory financial statements, a Class 3A insurer and a Class 3B insurer are each also required to deliver to the BMA a declaration of compliance, in such form and with such content as may be prescribed by the BMA, declaring whether or not the insurer has, with respect to the preceding financial year (i) complied with all requirements of the minimum criteria applicable to it, (ii) complied with the minimum margin of solvency as at its financial year end, (iii) complied with the applicable enhanced capital requirements as at its financial year end, (iv) complied with applicable conditions, directions and restrictions imposed on, or approvals granted to, the insurer and (v) complied with the minimum liquidity ratio for general business as at its financial year end.
+Added: At the time of filing its statutory financial statements, a Class 3B insurer is also required to deliver to the BMA a declaration of compliance, in such form and with such content as may be prescribed by the BMA, declaring whether or not the insurer has, with respect to the preceding financial year (i) complied with all requirements of the minimum criteria applicable to it, (ii) complied with the minimum margin of solvency as at its financial year end, (iii) complied with the applicable enhanced capital requirements as at its financial year end, (iv) complied with applicable conditions, directions and restrictions imposed on, or approvals granted to, the insurer and (v) complied with the minimum liquidity ratio for general business as at its financial year end.
The declaration of compliance is required to be signed by two directors of the insurer, and if the insurer has failed to comply with any of the requirements referenced in (i) through (v) above or observe any limitations, restrictions or conditions imposed upon the issuance of its license, if applicable, the insurer will be required to provide the BMA with particulars of such failure in writing.
−Removed: A Class 3A insurer and a Class 3B insurer shall be liable to a civil penalty by way of a fine for failure to comply with a duty imposed on it in connection with the delivery of the declaration of compliance.
+Added: A Class 3B insurer shall be liable to a civil penalty by way of a fine for failure to comply with a duty imposed on it in connection with the delivery of the declaration of compliance.
Annual Statutory Financial Return and Annual Capital and Solvency Return
−Removed: A Class 3A insurer and a Class 3B insurer are each required to file with the BMA a statutory financial return no later than four months after its financial year end (unless specifically extended with the approval of the BMA).
−Removed: The statutory financial return of an insurer shall consist of (i) an insurer information sheet, (ii) an auditor’s report, (iii) the statutory financial statements and (iv) notes to the statutory financial statements.
+Added: A Class 3B insurer is required to file with the BMA a statutory financial return no later than four months after its financial year end (unless specifically extended with the approval of the BMA).
+Added: The statutory financial return of an insurer shall consist of (i) an insurer information sheet, (ii) an auditor’s report, (iii) the statutory financial statements, (iv) notes to the statutory financial statements and (v) declaration of compliance.
The insurer information sheet shall state, among other matters, (i) whether the general purpose financial statements of the insurer for the relevant year have been audited and an unqualified opinion issued, (ii) the minimum margin of solvency applying to the insurer and whether such margin was met, (iii) whether or not the minimum liquidity ratio applying to the insurer for the relevant year was met and (iv) whether or not the insurer has complied with every condition attached to its certificate of registration.
3 unchanged sentences
In addition, each year the insurer is required to file with the BMA a capital and solvency return along with its annual statutory financial return.
−Removed: The prescribed form of capital and solvency return comprises the insurer’s Bermuda Solvency Capital Requirement (“BSCR”) model or an approved internal capital model in lieu thereof, together with such schedules as prescribed by the Insurance (Prudential Standards) (Class 3A Solvency Requirement) Rules 2011 for Class 3A insurers and the Insurance (Prudential Standards) (Class 4 and 3B Solvency Requirement) Rules 2008 for Class 3B insurers, respectively, as each are amended from time to time.
+Added: The prescribed form of capital and solvency return comprises the insurer’s Bermuda Solvency Capital Requirement (“BSCR”) model or an approved internal capital model in lieu thereof, together with such schedules as prescribed by the Insurance (Prudential Standards) (Class 4 and 3B Solvency Requirement) Rules 2008 for Class 3B insurers, as amended from time to time.
Neither the statutory financial return nor the capital and solvency return is available for public inspection.
1 unchanged sentence
A Class 3B insurer, not otherwise subject to group supervision, is required to prepare and file quarterly financial returns with the BMA on or before the last day of the months of May, August and November of each year.
−Removed: The quarterly financial returns consist of (i) quarterly unaudited financial statements for each financial quarter (which must minimally include a balance sheet and income statement and must also be recent and not reflect a financial position that exceeds two months), (ii) a list and details of material intra-group transactions that the Class 3B insurer is a party to and the Class 3B insurer’s risk concentrations that have materialized since the most recent quarterly or annual financial returns, details surrounding all intra-group reinsurance and retrocession arrangements and other intra-group risk transfer insurance business arrangements that have materialized since the most recent quarterly or annual financial returns and (iii) details of the ten largest exposures to unaffiliated counterparties and any other unaffiliated counterparty exposures exceeding 10% of the Class 3B insurer’s statutory capital and surplus.
+Added: The quarterly financial returns consist of (i) quarterly unaudited financial statements for each financial quarter (which must minimally include a balance sheet and income statement and must also be recent and not reflect a financial position that exceeds two months), (ii) a list and details of material intra-group transactions that the Class 3B insurer is a party to and the Class 3B insurer’s risk concentrations that have materialized since the most recent quarterly or annual financial returns, details surrounding all intra-group reinsurance and retrocession arrangements and other intra-group risk transfer insurance business arrangements that have materialized since the most recent quarterly or annual financial returns, (iii) details of the ten largest exposures to unaffiliated counterparties and any other unaffiliated counterparty exposures exceeding 10% of the Class 3B insurer’s statutory capital and surplus, (iv) enhanced capital requirement ratio, (v) commercial insurers solvency self-assessment, (vi) total quoted bonds and
+Added: unquoted bonds by BSCR rating and (vii) details of the catastrophe event that occurred during the reporting period (if applicable).
Public Disclosures
2 unchanged sentences
Independent Approved Auditor
−Removed: A Class 3A insurer and a Class 3B insurer must each appoint an independent auditor who will audit and report on the insurer’s GAAP financial statements and statutory financial statements, each of which are required to be filed annually with the BMA.
+Added: A Class 3B insurer must appoint an independent auditor who will audit and report on the insurer’s GAAP financial statements and statutory financial statements, each of which are required to be filed annually with the BMA.
The auditor must be approved by the BMA as the independent auditor of the insurer.
1 unchanged sentence
Non-insurance Business
−Removed: No Class 3A insurer or Class 3B insurer may engage in non-insurance business unless that non-insurance business is ancillary to its insurance business.
−Removed: Non-insurance business means any business other than insurance business and includes carrying on investment business, managing an investment fund as operator, carrying on business as a fund administrator,
−Removed: carrying on banking business, underwriting debt or securities or otherwise engaging in investment banking, engaging in commercial or industrial activities and carrying on the business of management, sales or leasing of real property.
+Added: No Class 3B insurer may engage in non-insurance business unless that non-insurance business is ancillary to its insurance business.
+Added: Non-insurance business means any business other than insurance business and includes carrying on investment business, managing an investment fund as operator, carrying on business as a fund administrator, carrying on banking business, underwriting debt or securities or otherwise engaging in investment banking, engaging in commercial or industrial activities and carrying on the business of management, sales or leasing of real property.
Minimum Liquidity Ratio
The Insurance Act provides a minimum liquidity ratio for general business insurers.
−Removed: A Class 3A insurer and a Class 3B insurer engaged in general business is required to maintain the value of its relevant assets at not less than 75% of the amount of its relevant liabilities.
+Added: A Class 3B insurer engaged in general business is required to maintain the value of its relevant assets at not less than 75% of the amount of its relevant liabilities.
Relevant assets include cash and time deposits, quoted investments, unquoted bonds and debentures, first liens on real estate, investment income due and accrued, accounts and premiums receivable, reinsurance balances receivable, funds held by ceding reinsurers and any other assets which the BMA, on application in any particular case made to it with reasons, accepts in that case.
3 unchanged sentences
The Insurance Act provides that the value of the statutory assets of an insurer must exceed the value of its statutory liabilities by an amount greater than its prescribed minimum solvency margin (“MSM”).
−Removed: The MSM that must be maintained by a Class 3A insurer and a Class 3B insurer with respect to its general business is the greater of (i) $1,000,000, (ii) 20% of the first $6,000,000 of net premiums written (but if the net premiums written are in excess of $6,000,000, the figure is $1,200,000 plus 15% of net premiums written in excess of $6,000,000) or (iii) 15% of the aggregate of net loss and loss expense provisions and other insurance general business reserves or (iv) 25% of the ECR (as defined below) as reported at the end of the relevant year.
−Removed: Class 3A insurers and Class 3B insurers are also required to maintain available statutory economic capital and surplus at a level equal to or in excess of its enhanced capital requirement (“ECR”) which is established by reference to either the BSCR model or an approved internal capital model.
+Added: The MSM that must be maintained by a Class 3B insurer with respect to its general business is the greater of (i) $1,000,000, (ii) 20% of the first $6,000,000 of net premiums written (but if the net premiums written are in excess of $6,000,000, the figure is $1,200,000 plus 15% of net premiums written in excess of $6,000,000) or (iii) 15% of the aggregate of net loss and loss expense provisions and other insurance general business reserves or (iv) 25% of the ECR (as defined below) as reported at the end of the relevant year.
+Added: Class 3B insurers are also required to maintain available statutory economic capital and surplus at a level equal to or in excess of its enhanced capital requirement (“ECR”) which is established by reference to either the BSCR model or an approved internal capital model.
The BSCR model is a risk-based capital model which provides a method for determining an insurer’s capital requirements (statutory economic capital and surplus) by taking into account the risk characteristics of different aspects of the insurer’s business.
2 unchanged sentences
For each category, the capital requirement is determined by applying factors to asset, premium, reserve, creditor, probable maximum loss and operation items, with higher factors applied to items with greater underlying risk and lower factors for less risky items.
−Removed: While not specifically referred to in the Insurance Act (or required thereunder), the BMA has also established a target capital level (“TCL”) for each Class 3A insurer and Class 3B insurer equal to 120% of its ECR.
+Added: While not specifically referred to in the Insurance Act (or required thereunder), the BMA has also established a target capital level (“TCL”) for each Class 3B insurer equal to 120% of its ECR.
The TCL serves as an early warning tool for the BMA, and failure to maintain statutory capital at least equal to the TCL will likely result in increased regulatory oversight.
5 unchanged sentences
Eligible Capital
−Removed: To enable the BMA to better assess the quality of an insurer’s capital resources, a Class 3A insurer and a Class 3B insurer are each required to disclose the makeup of its capital in accordance with a “3-tiered eligible capital system”.
+Added: To enable the BMA to better assess the quality of an insurer’s capital resources, a Class 3B insurer is required to disclose the makeup of its capital in accordance with a “3-tiered eligible capital system”.
Under this system, all of the insurer’s capital instruments will be classified as either basic or ancillary capital which in turn will be classified into one of three tiers based on their “loss absorbency” characteristics.
8 unchanged sentences
Failure to comply with the requirements of the Insurance Code will be taken into account by the BMA in determining whether an insurer is conducting its business in a sound and prudent manner as prescribed by the Insurance Act, may result in the BMA exercising its powers of intervention and investigation (see below) and will be a factor in calculating the operational risk charge under the insurer’s BSCR or approved internal model.
+Added: Cyber Risk Code of Conduct
+Added: The BMA has recognized that cyber incidents can cause significant financial losses and/or reputational impacts across the insurance industry and has implemented the Insurance Sector Operational Cyber Risk Management Code of Conduct (the “Cyber Risk Code”) to ensure that those operating in the Bermuda insurance sector can mitigate such risks.
+Added: The Cyber Risk Code prescribes the duties, requirements, standards, procedures and principles which all insurers, insurance managers and insurance intermediaries (agents, brokers and insurance market place providers) registered under the Insurance Act must comply.
+Added: The Cyber Risk Code is designed to promote the stable and secure management of information technology systems of regulated entities and requires that all registrants implement their own technology risk programmes, determine what their top risks are and develop an appropriate risk response.
+Added: This requires all registrants to develop a cyber risk policy which is to be delivered pursuant to an operational cyber risk management programme and appoint an appropriately qualified member of staff or outsourced resource to the role of Chief Information Security Officer.
+Added: The role of the Chief Information Security Officer is to deliver the operational cyber risk management programme.
+Added: It is expected that the cyber risk policy will be approved by the registrant’s board of directors at least annually.
+Added: The BMA will assess a registrant’s compliance with the Cyber Risk Code in a proportionate manner relative to the nature, scale and complexity of its business.
+Added: While it is acknowledged that some registrants will use a third party to provide technology services and that they may outsource their IT resources (for example, to an insurance manager where applicable), when so outsourced, the overall responsibility for the outsourced functions will remain with the registrant’s board of directors.
+Added: Failure to comply with the requirements of the Cyber Risk Code will be taken into account by the BMA in determining whether a registrant is
+Added: conducting its business in a sound and prudent manner as prescribed by the Insurance Act and may result in the BMA exercising its powers of intervention and investigation (see below).
Restrictions on Dividends and Distributions
−Removed: A Class 3A insurer and a Class 3B insurer are each prohibited from declaring or paying a dividend if it is in breach of its MSM, ECR or minimum liquidity ratio or if the declaration or payment of such dividend would cause such a breach.
+Added: A Class 3B insurer is prohibited from declaring or paying a dividend if it is in breach of its MSM, ECR or minimum liquidity ratio or if the declaration or payment of such dividend would cause such a breach.
Where an insurer fails to meet its MSM or minimum liquidity ratio on the last day of any financial year, it will be prohibited from declaring or paying any dividends during the next financial year without the approval of the BMA.
−Removed: In addition, a Class 3A insurer and a Class 3B insurer is prohibited from declaring or paying in any financial year dividends of more than 25% of its total statutory capital and surplus (as shown on its previous financial year’s statutory balance sheet), unless it files (at least seven days before payment of such dividends) with the BMA an affidavit signed by at least two directors (one of whom must be a Bermuda resident director if any of the insurer’s directors are resident in Bermuda) and the principal representative stating that it will continue to meet its solvency margin and minimum liquidity ratio.
+Added: In addition, a Class 3B insurer is prohibited from declaring or paying in any financial year dividends of more than 25% of its total statutory capital and surplus (as shown on its previous financial year’s statutory balance sheet), unless it files (at least seven days before payment of such dividends) with the BMA an affidavit signed by at least two directors (one of whom must be a Bermuda resident director if any of the insurer’s directors are resident in Bermuda) and the principal representative stating that it will continue to meet its solvency margin and minimum liquidity ratio.
Where such an affidavit is filed, it shall be available for public inspection at the offices of the BMA.
Reduction of Capital
−Removed: No Class 3A insurer or Class 3B insurer may reduce its total statutory capital by 15% or more, as set out in its previous year’s financial statements, unless it has received the prior approval of the BMA.
+Added: No Class 3B insurer may reduce its total statutory capital by 15% or more, as set out in its previous year’s financial statements, unless it has received the prior approval of the BMA.
Total statutory capital consists of the insurer’s paid in share capital, its contributed surplus (sometimes called additional paid in capital) and any other fixed capital designated by the BMA as statutory capital (such as letters of credit).
−Removed: A Class 3A insurer or Class 3B insurer seeking to reduce its respective statutory capital by 15% or more, as set out in its previous year’s financial statements, is also required to submit an affidavit signed by at least two directors (one of whom must be a Bermuda-resident director if any of the insurer’s directors are resident in Bermuda) and the principal representative stating that the proposed reduction will not cause it to fail its relevant margins and such other information as the BMA may require.
+Added: A Class 3B insurer seeking to reduce its statutory capital by 15% or more, as set out in its previous year’s financial statements, is also required to submit an affidavit signed by at least two directors (one of whom must be a Bermuda-resident director if any of the insurer’s directors are resident in Bermuda) and the principal representative stating that the proposed reduction will not cause it to fail its relevant margins and such other information as the BMA may require.
Where such an affidavit is filed, it shall be available for public inspection at the offices of the BMA.
12 unchanged sentences
A shareholder controller that owns 50% or more of the shares as described above is defined as a 50% shareholder controller.
−Removed: As the shares of Carolina Re’s and JRG Re’s parent company are traded on a recognized stock exchange, a person who becomes a 10%, 20%, 33% or 50% shareholder controller of the insurer, shall, within 45 days, notify the BMA in writing that he or she has become such a controller.
−Removed: In addition, a person who is a shareholder controller of Carolina Re or JRG Re must serve on the BMA a notice in writing that he or she has reduced or disposed of his or her holding in the insurer where the proportion of voting rights in the insurer held by him or her will have reached or has fallen below 10%, 20%, 33% or 50% as the case may be, not later than 45 days after such disposal.
+Added: As the shares of JRG Re’s parent company are traded on a recognized stock exchange, a person who becomes a 10%, 20%, 33% or 50% shareholder controller of the insurer, shall, within 45 days, notify the BMA in writing that he or she has become such a controller.
+Added: In addition, a person who is a shareholder controller of JRG Re must serve on the BMA a notice in writing that he or she has reduced or disposed of his or her holding in the insurer where the proportion of voting rights in the insurer
+Added: held by him or her will have reached or has fallen below 10%, 20%, 33% or 50% as the case may be, not later than 45 days after such disposal.
Any person who contravenes the Insurance Act by failing to give notice or knowingly becomes a controller of any description before the required 45 days has elapsed is guilty of an offence and liable to a fine of $25,000 on summary conviction.
21 unchanged sentences
The BMA may, by notice in writing served on a registered person or a designated insurer, require the registered person or designated insurer to provide such information and/or documentation as the BMA may reasonably require with respect to matters that are likely to be material to the performance of its supervisory functions under the Insurance Act.
−Removed: In addition, it may require such person’s auditor, underwriter, accountant or any other person with relevant professional skill of such registered person or designated insurer to prepare a report on any aspect pertaining thereto.
+Added: In addition, it may
+Added: require such person’s auditor, underwriter, accountant or any other person with relevant professional skill of such registered person or designated insurer to prepare a report on any aspect pertaining thereto.
In the case of a report, the person so appointed shall immediately give the BMA written notice of any fact or matter of which he becomes aware or which indicates to him that any condition attaching to his registration under the Insurance Act is not or has not, or may not be or may not have, been fulfilled and that such matters are likely to be material to the performance of its functions under the Insurance Act.
6 unchanged sentences
The BMA may also enter any premises for the purposes of carrying out its investigation and may petition the court for a warrant if it believes a person has failed to comply with a notice served on him, there are reasonable grounds for suspecting the completeness of any information or documentation produced in response to such notice, or that its directions will not be complied with or that any relevant documents would be removed, tampered with or destroyed.
−Removed: If it appears to the BMA that the business of the registered insurer is being conducted in a way that there is a significant risk of the insurer becoming insolvent or being unable to meet its obligations to policyholders, or that the insurer is in breach of the Insurance Act or any conditions imposed upon its registration, or the minimum criteria stipulated in the Insurance Act is not or has not been fulfilled in respect of a registered insurer, or that a person has become a controller without providing the BMA with the appropriate notice or in contravention of a notice of objection, or the registered insurer is in breach of its ECR, or that a
−Removed: designated insurer is in breach of any provision of the Insurance Act or the regulations or rules applicable to it, the BMA may issue such directions as it deems desirable for safeguarding the interests of policyholders or potential policyholders of the insurer or the insurance group.
+Added: If it appears to the BMA that the business of the registered insurer is being conducted in a way that there is a significant risk of the insurer becoming insolvent or being unable to meet its obligations to policyholders, or that the insurer is in breach of the Insurance Act or any conditions imposed upon its registration, or the minimum criteria stipulated in the Insurance Act is not or has not been fulfilled in respect of a registered insurer, or that a person has become a controller without providing the BMA with the appropriate notice or in contravention of a notice of objection, or the registered insurer is in breach of its ECR, or that a designated insurer is in breach of any provision of the Insurance Act or the regulations or rules applicable to it, the BMA may issue such directions as it deems desirable for safeguarding the interests of policyholders or potential policyholders of the insurer or the insurance group.
The BMA may, among other things, direct an insurer, for itself and in its capacity as designated insurer of the insurance group of which it is a member, (i) not to take on any new insurance business, (ii) not to vary any insurance contract if the effect would be to increase the insurer’s liabilities, (iii) not to make certain investments, (iv) to realize certain investments, (v) to maintain in or transfer to the custody of a specified bank, certain assets, (vi) not to declare or pay any dividends or other distributions or to restrict the making of such payments, (vii) to limit its premium income, (viii) not to enter into specified transactions with any specified person or persons of a specified class, (ix) to provide such written particulars relating to the financial circumstances of the insurer as the BMA thinks fit, (x) as an individual insurer only, and not in its capacity as designated insurer, to obtain the opinion of a loss reserve specialist and submit it to the BMA, and/or (xi) to remove a controller or officer.
19 unchanged sentences
Generally, it is not permitted without a special license granted by the Minister of Finance to insure Bermuda domestic risks or risks of persons of, in or based in Bermuda.
−Removed: Each of Carolina Re and JRG Re is a licensed insurer in Bermuda, and so it may carry on activities from Bermuda that are related to and in support of its insurance business.
+Added: JRG Re is a licensed insurer in Bermuda, and so it may carry on activities from Bermuda that are related to and in support of its insurance business.
Each of James River Group Holdings, Ltd., Carolina Re and JRG Re must comply with the provisions of the Companies Act regulating the payment of dividends and making distributions from contributed surplus.
1 unchanged sentence
In addition, certain provisions of the Insurance Act will limit our ability to pay dividends.
−Removed: Under the Companies Act, where a Bermuda company issues shares at a premium (that is, for a price above the par value), whether for cash or otherwise, a sum equal to the aggregate amount or value of the premium on those shares must be transferred
−Removed: to an account called “the share premium account.” The provisions of the Companies Act relating to the reduction of the share capital of a company apply as if the share premium account were paid up share capital of that company, except for certain matters such as:
+Added: Under the Companies Act, where a Bermuda company issues shares at a premium (that is, for a price above the par value), whether for cash or otherwise, a sum equal to the aggregate amount or value of the premium on those shares must be transferred to an account called “the share premium account.” The provisions of the Companies Act relating to the reduction of the share capital of a company apply as if the share premium account were paid up share capital of that company, except for certain matters such as:
(i) paying up unissued shares to be issued to members as fully paid bonus shares, (ii) writing off the preliminary expenses of the company or the expenses of, or the commission paid or discount allowed on any issue of shares or debentures of the company, or (iii) providing for the premiums payable on redemption of shares or of any debentures of the company.
25 unchanged sentences
In addition to the advertising, there are other documents that are required prior to the Department of Immigration making its decision.
−Removed: If the position for which the standard work permit is being applied is that of a Chief Executive Officer or other chief officer post, the Minister of Labour allows an automatic waiver from the requirement to advertise the job and on occasion may waive the requirement to advertise for other senior executive positions.
−Removed: If an employer wishes to change an employee’s job title, provided that the job description, duties, remuneration and benefits remain unchanged, the employer does not need to advertise or obtain the permission of the Minister of Labour to do this, but it must inform the Department of Immigration and pay the necessary fee after the change has occurred.
−Removed: If an employer wishes to promote an employee currently on a work permit from his current job to another within the same business, the permission of the Minister of Labour must first be obtained.
−Removed: The employer will need to provide evidence of internal recruitment efforts and consideration of internal Bermudian/spouse of Bermudian candidates.
+Added: If the position for which the standard work permit is being applied is that of a Chief Executive Officer or other chief officer post, the Minister of Economy and Labour allows an automatic waiver from the requirement to advertise the position and on occasion may waive the requirement to advertise for other senior executive positions upon request.
+Added: If an employer wishes to change an employee’s job title, provided that the job description, duties, remuneration and benefits remain unchanged, the employer does not need to advertise or obtain the permission of the Minister of Economy and Labour to do this, but it must inform the Department of Immigration and pay the necessary fee after the change has occurred.
+Added: If an employer wishes to promote an employee currently on a work permit from his current job to another within the same business, the permission of the Minister of Economy and Labour must first be obtained.
+Added: The employer will need to advertise internally and provide evidence of the internal recruitment efforts and consideration of internal Bermudian/spouse of Bermudian candidates.
A temporary work permit can take up to 10 working days to process and a standard work permit takes four weeks to process.
12 unchanged sentences
In California, the domiciliary state of Falls Lake Fire and Casualty Company, this limitation is the greater of statutory net income for the preceding calendar year or 10% of the statutory surplus at the end of the preceding calendar year, provided that such dividends may only be paid out of unassigned surplus without obtaining regulatory approval.
−Removed: In addition, insurance regulators have broad powers to prevent
−Removed: reduction of statutory surplus to inadequate levels and could refuse to permit the payment of dividends calculated under any applicable formula.
+Added: In addition, insurance regulators have broad powers to prevent reduction of statutory surplus to inadequate levels and could refuse to permit the payment of dividends calculated under any applicable formula.
Premium rate regulation varies greatly among jurisdictions and lines of insurance.
12 unchanged sentences
In 2012, the NAIC adopted significant changes to the insurance holding company act and regulations (the “NAIC Amendments”).
−Removed: The NAIC Amendments, when adopted by the various states, are designed to respond to perceived gaps in the regulation of insurance holding company systems in the United States.
+Added: The NAIC Amendments, when adopted by the various states, are designed to
+Added: respond to perceived gaps in the regulation of insurance holding company systems in the United States.
One of the major changes is a requirement that an insurance holding company system’s ultimate controlling person submit annually to its lead state insurance regulator an “enterprise risk report” that identifies activities, circumstances or events involving one or more affiliates of an insurer that, if not remedied properly, are likely to have a material adverse effect upon the financial condition or liquidity of the insurer or its insurance holding company system as a whole.
14 unchanged sentences
Under state insurance guaranty fund laws, insurance companies doing business in a state can be assessed for certain obligations of insolvent insurance companies to such insolvent companies’ policyholders and claimants.
−Removed: Maximum assessments allowed in any one year generally vary between one percent and two percent of annual premiums written in that state, but it is
−Removed: possible that caps on such assessments could be raised if there are numerous or large insolvencies.
+Added: Maximum assessments allowed in any one year generally vary between one percent and two percent of annual premiums written in that state, but it is possible that caps on such assessments could be raised if there are numerous or large insolvencies.
In most states, guaranty fund assessments are recoverable either through future policy surcharges or offsets to state premium tax liabilities.
12 unchanged sentences
The following states have either adopted the NAIC Insurance Data Security Model Law or similar laws that govern the cybersecurity and data protection practices of insurers, insurance agents, and other licensed entities registered under state insurance laws:
−Removed: Alabama, California, Connecticut, Delaware, Indiana, Iowa, Louisiana, Maine, Michigan, Minnesota, Mississippi, New Hampshire, New York, North Dakota, Ohio, South Carolina, Tennessee, Virginia and Wisconsin.
+Added: Alabama, Alaska, California, Connecticut, Delaware, Hawaii, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, New Hampshire, New York,
+Added: North Dakota, Ohio, South Carolina, Tennessee, Vermont, Virginia and Wisconsin.
We continue to monitor whether the other states in which we conduct business adopt the NAIC’s Insurance Data Security Model Law.
31 unchanged sentences
We recognize the mutual benefits for our company and our employees to further their formal education and professional development.
−Removed: Our Employee Development and Education Assistance program provides financial assistance for courses, development programs and professional affiliations.
+Added: Our Employee Development and Education Assistance program provides financial assistance for courses,
+Added: development programs and professional affiliations.
Additionally, employees have access to an online learning management system that hosts courses and modules across a wide range of topics.
1 unchanged sentence
Our benefits include medical, dental and vision insurance, a comprehensive employee assistance program to support the mental health of our employees and their families, employer-paid life and disability plans, contributions to employee retirement accounts through a company match with immediate vesting as well as paid parental leave and adoption assistance.
−Removed: In July of 2021, after more than a year and a half of our offices being closed to all non-essential staff due to the COVID-19 pandemic, we reopened our offices on a voluntary basis.
−Removed: We built a reopening plan that reflected the shared goals and needs of our employees and business, placing an emphasis on remaining safe, productive and connected.
−Removed: Safety measures and procedures have been implemented throughout our offices to help ensure that all staff working in the office remain safe.
+Added: We continue to encourage a hybrid work model, one that offers our employees a flexible work environment that fosters in-person connection and collaboration and best supports our success as a company.
+Added: The health and safety of our employees continues to be our highest priority, and therefore we monitor and adjust our in-office safety policies and procedures, as needed, to mitigate the risk of exposure to the COVID-19 virus.
We value the opinions and diverse perspectives of our employees and utilize the feedback that we receive throughout the year to help develop many of our company programs, policies, and benefits.
14 unchanged sentences
The address of that site is http://www.sec.gov.
−Removed: Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and other information filed by us with the SEC are available, without charge, on our Internet web site, http://www.jrgh.net, as soon as reasonably practicable after they are filed electronically with the SEC.
+Added: Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and other information filed by us with the SEC are available, without charge, on our Internet web site, https://jrvrgroup.com, as soon as reasonably practicable after they are filed electronically with the SEC.
Copies are also available, without charge, by writing to us at James River Group Holdings, Ltd., Wellesley House, 2 nd Floor, 90 Pitts Bay Road, Pembroke, HM 08, Bermuda.
1 unchanged sentence
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.