3 unchanged sentences
We are exposed to interest rate risk on our investment portfolio.
+Added: Interest rate risk is the risk that we will incur losses due to adverse changes in interest rates relative to the interest rate characteristics of interest bearing assets and liabilities.
Our fixed maturity investments include U.S.
−Removed: Treasury securities, municipal securities, corporate debt securities, residential mortgage-backed securities, and commercial mortgage-backed securities, most of which are exposed to changes in prevailing interest rates.
+Added: Treasury securities, municipal securities, corporate debt securities, residential mortgage-backed securities, commercial mortgage-backed securities, and other debt obligations portfolio, most of which are exposed to changes in prevailing interest rates and which may experience moderate fluctuations in fair value resulting from changes in interest rates.
+Added: The fair market value of a portfolio of debt securities increases or decreases inversely with changes in market interest rates, while net investment income realized from future investments in debt securities increases or decreases along with interest rates.
We monitor this exposure through periodic reviews of investment portfolio by our management.
−Removed: We are also exposed to the impact of interest rate changes through our term loan facility that closed in January 2022 and incurs interest at floating rates based on changes in the Secured Overnight Financing Rate, or SOFR.
−Removed: We did not have any long-term debt outstanding at December 31, 2021.
+Added: We are also exposed to interest rate risk through our term loan facility which incurs interest at floating rates based on changes in the SOFR.
+Added: Rising interest rates could have an adverse impact on the cost of debt and results in less cash available to utilize in our operations, and could have a material adverse effect on our business and financial condition.
+Added: A 1% fluctuation in SOFR would not have significantly impacted interest expense during 2022.
We are exposed to credit risk on our investment portfolio and our reinsurance contracts.
+Added: Credit risk results from uncertainty in a counterparty’s ability to meet its obligations.
+Added: We monitor our investment portfolio to ensure that credit risk does not exceed prudent levels.
We manage the exposure to credit risk in our U.S.
−Removed: Treasury securities, municipal securities, corporate debt securities, residential mortgage-backed securities, and commercial mortgage-backed securities by investing in high quality securities and diversifying our holdings.
+Added: Treasury securities, municipal securities, corporate debt securities, residential mortgage-backed securities, commercial mortgage-backed securities, and other debt obligations portfolio by investing in high credit quality, investment grade securities and diversifying our holdings.
We manage the exposure to credit risk in our reinsurance contracts by obtaining reinsurance from a diverse group of reinsurers and monitoring concentration as well as financial strength ratings of the reinsurers to minimize counterparty credit risk.
−Removed: Additionally, all reinsurance contracts provide for indemnification against loss or liability relating to insurance risk and have been accounted for as reinsurance.
−Removed: We monitor our investment portfolio to ensure that credit risk does not exceed prudent levels.
−Removed: The majority of our investment portfolio is invested in high credit quality, investment grade fixed maturity securities.
−Removed: As of December 31, 2021, none of our fixed maturity portfolio was unrated or rated below investment grade.
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.