42 unchanged sentences
Best threshold.
−Removed: Our catastrophe event retention is currently $17.5 million for all perils.
+Added: Our catastrophe event retention is $20 million for earthquake events and $15.5 million for hurricane events and all other perils.
In addition to our event retention, we may also incur additional reinsurance expenses upon a catastrophe event.
11 unchanged sentences
We evaluate each reinsurance claim based on the facts of the case, historical experience with the reinsurer on similar claims and existing case law and consider including any amounts deemed uncollectible from the reinsurer in a reserve for uncollectible reinsurance.
−Removed: As of March 31, 2024, we had $320.6 million of aggregate reinsurance recoverables.
+Added: As of June 30, 2024, we had $381.1 million of aggregate reinsurance recoverables.
Our loss reserves are established based on estimates which may be inadequate to cover actual incurred losses and could have a material adverse impact on our results of operations and financial condition.
33 unchanged sentences
Torrey Pines Re Pte.
−Removed: is a special purpose reinsurance vehicle incorporated in Singapore that provides Palomar with indemnity-based reinsurance covering earthquake events through June 1, 2024.
+Added: is a special purpose reinsurance vehicle incorporated in Singapore that provided Palomar with indemnity-based reinsurance covering earthquake events through June 1, 2024.
During the second quarter of 2022, we closed a $275 million 144A catastrophe bond which became effective June 1, 2022.
2 unchanged sentences
This catastrophe bond was also completed through Torrey Pines Re Ltd and provides indemnity-based reinsurance covering earthquake events through June 1, 2026.
+Added: During the second quarter of 2024, the Company also closed a $420 million 144A catastrophe bond which became effective June 1, 2024.
+Added: This catastrophe bond was also completed through Torrey Pines Re Ltd and provides indemnity-based reinsurance covering earthquake events through June 1, 2027.
We may seek similar catastrophe bond offerings in the future.
38 unchanged sentences
Best financial strength ratings range from “A++” (Superior) to “F” for insurance companies that have been publicly placed in liquidation.
−Removed: As of March 31, 2024, A.M.
+Added: As of June 30, 2024, A.M.
Best has assigned a financial strength rating of “A−” (Excellent) (Outlook Positive) to our insurance company subsidiaries, Palomar Specialty Insurance Company (“PSIC”) and Palomar Excess and Surplus Insurance Company (“PESIC”).
30 unchanged sentences
Our business is concentrated in California and, as a result, we are exposed more significantly to California loss activity and regulatory environments.
−Removed: Our policyholders and insurance risks are currently concentrated in California, which generated 53% of our gross written premiums for the year ended December 31, 2023 and 43% for the three months ended March 31, 2024.
+Added: Our policyholders and insurance risks are currently concentrated in California, which generated 53% of our gross written premiums for the year ended December 31, 2023 and 45% for the six months ended June 30, 2024.
We are exposed to business, economic, political, judicial and regulatory risks due to this concentration that are greater than the risks faced by insurance companies with a lower concentration of their premiums in California.
19 unchanged sentences
There were no other program administrators which distributed greater than 10% of our gross written premiums for the year ended December 31, 2023.
−Removed: For the three months ended March 31, 2024, our largest program administrator distributed $86.7 million or 23.6% of our gross written premiums and our second largest program administrator distributed $47.5 million, or 12.9% of our gross written premiums.
−Removed: There were no other program administrators which distributed greater than 10% of our gross written premiums for the three months ended March 31, 2024.
+Added: For the six months ended June 30, 2024, our largest program administrator distributed $193.9 million or 25.7% of our gross written premiums and our second largest program administrator distributed $91.4 million, or 12.1% of our gross written premiums.
+Added: There were no other program administrators which distributed greater than 10% of our gross written premiums for the six months ended June 30, 2024.
Our largest program administrator, Arrowhead General Insurance Agency, distributes our Value Select Residential Earthquake program, which represents the majority of our Residential Earthquake premium and is administered through a mutually exclusive agreement for the states of California, Oregon and Washington.
40 unchanged sentences
Our failure to evaluate and pay claims accurately and timely could lead to regulatory and administrative actions or material litigation, undermine our reputation in the marketplace, and materially and adversely affect our business, financial condition, results of operations, and prospects.
−Removed: In addition, if we do not manage our TPAs effectively, or if our TPAs are unable to effectively handle our volume of claims, our ability to handle our claims workload could be adversely affected.
+Added: In addition, if we do not manage our TPAs effectively, or if our TPAs are unable to effectively manage our volume of claims, our ability to manage our claims workload could be adversely affected.
In addition to potentially requiring that growth be slowed in the affected markets, our business could suffer from decreased quality of claims work which, in turn, could adversely affect our results of operations.
26 unchanged sentences
The failure to manage our growth effectively could have a material adverse effect on our business, financial condition and results of operations.
+Added: We face risks associated with the evaluation of potential acquisitions, the integration of acquired businesses, and the introduction of new products, lines of business, and markets.
+Added: As part of our business strategy, we may make acquisitions, including acquisitions in lines of business that are natural adjacencies.
+Added: The success of our acquisition strategy is dependent upon our ability to identify appropriate acquisition targets, negotiate transactions on favorable terms, complete transactions, have adequate access to financing and the ability to finance acquisitions on acceptable terms, and successfully integrate them into our existing businesses.
+Added: If acquisitions are made, we may not realize the anticipated benefits of such acquisitions, including, but not limited to, revenue growth, operational efficiencies, or expected synergies.
+Added: Many of the businesses and assets that we have acquired or may acquire have unaudited historical financial statements or records that have been, or will be, prepared by the management of such companies and have not been, or will not be, independently reviewed or audited.
+Added: We cannot be certain that the financial statements or records of companies or assets we have acquired or may acquire would not, or will not, be materially different if such statements were independently reviewed or audited.
+Added: If such statements were to be materially different, the tangible and intangible assets we acquire may be more susceptible to impairment charges, which could have a material adverse effect on us.
+Added: In addition, many of the businesses that we acquire and develop will likely have smaller scales of operations prior to the implementation of our growth strategy.
+Added: If we are not able to manage the growing complexity of these businesses, including improving, refining, or revising our systems and operational practices, enlarging the scale and scope of the businesses, and integrating the new business into our culture and operations, our business may be adversely affected.
+Added: From time to time, either through acquisitions or internal development, we enter new distribution channels or lines of business or offer new products and services within existing lines of business.
+Added: These new distribution channels, lines of business, or new products and services present additional risks, particularly in instances where the markets are not fully developed.
+Added: Such risks include the investment of significant time and resources to recruit, hire, and retain personnel and develop the products, the risks involved with the management of the integration process and development of new processes and systems to accommodate complex programs, and the risk of financial guarantees and additional liabilities associated with these efforts.
+Added: Failure to manage these risks arising from acquisitions or development of new businesses could materially and adversely affect our business, results of operations, and financial condition.
Our operating results have in the past varied from quarter to quarter and may not be indicative of our long ‑ term prospects.
45 unchanged sentences
These securities are carried on the balance sheet at fair market value and are subject to potential losses and declines in market value based on the performance of equity markets.
−Removed: Our equity invested assets totaled $37.2 million as of March 31, 2024.
+Added: Our equity invested assets totaled $37.8 million as of June 30, 2024.
Risks for all types of securities are managed through the application of our investment policy, which establishes investment parameters that include but are not limited to, maximum percentages of investment in certain types of securities and minimum levels of credit quality, which we believe are within applicable guidelines established by the National Association of Insurance Commissioners (“NAIC”), the Oregon Division of Financial Regulation and the California and Arizona Departments of Insurance.
4 unchanged sentences
In addition, declines in fixed income yields would result in decreases in net investment income from future investment activity, including re-investments.
−Removed: We may, in certain circumstances, invest immaterial amounts in private companies we believe provide strategic opportunities.
+Added: We may, in certain circumstances, invest in private companies or limited partnerships which we believe provide strategic opportunities.
+Added: We do not intend to devote a significant portion of our investment portfolio to these types of investments.
These types of investments are typically illiquid, and we have limited ability to take actions that protect or increase the value of this type of investment.
124 unchanged sentences
As PSIC grows, its share of any assessments in each state in which it underwrites business on an admitted basis may increase.
−Removed: PSIC paid assessments of $0.2 million in 2023 and paid $5.0 million of assessments for the three months ended March 31, 2024.
+Added: PSIC paid assessments of $0.2 million in 2023 and paid $5.0 million of assessments for the six months ended June 30, 2024.
We cannot predict with certainty the amount of future assessments because they depend on factors outside our control, such as insolvencies of other insurance companies as well as the occurrence of significant catastrophes.
167 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.