0001502292false0001502292cnfr:NinePointSevenFivePercentSeniorNotesDue2028Member2023-11-092023-11-0900015022922023-11-092023-11-090001502292cnfr:CommonStockNoParValueMember2023-11-092023-11-09
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event Reported): November 9, 2023
Conifer Holdings Inc.
(Exact Name of Registrant as Specified in Charter)
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Michigan |
001-37536 |
27-1298795 |
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
3001 West Big Beaver, Suite 200
Troy, MI 48084
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (248) 559-0840
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
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Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
Common Stock, no par value |
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CNFR |
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The Nasdaq Stock Market LLC |
9.75% Senior Notes due 2028 |
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CNFRZ |
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The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter)
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On November 9, 2023, Conifer Holdings, Inc. (the "Company") publicly announced results for the third quarter of 2023. A copy of the Company's news release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The information in this Item 2.02 and the attached exhibit shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act except as shall be expressly stated by specific reference in such filing.
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Item 9.01. Financial Statements and Exhibits. |
Exhibit 99.1 |
Press Release dated November 9, 2023 |
Exhibit 104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Conifer Holdings Inc. |
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Date: November 13, 2023 |
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By: |
/s/ BRIAN J. RONEY |
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Brian J. Roney |
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President |
News Release
For Further Information:
Jessica Gulis, 248.559.0840
ir@cnfrh.com
Conifer Holdings Reports 2023 Third Quarter Financial Results
Company to Host Conference Call at 8:30 AM ET on Friday, November 10, 2023
Troy, MI, November 9, 2023 – Conifer Holdings, Inc. (Nasdaq: CNFR) (“Conifer” or the “Company”) today announced results for the third quarter ended September 30, 2023.
Third Quarter 2023 Financial Highlights (compared to the prior year period)
•Gross written premium increased 16.5% to $38.5 million
•Net investment income increased 68.6% to $1.5 million
•Expense ratio improved to 33.9%, down 600 bps from the prior year
•Combined ratio of 120.8%; accident year combined ratio excluding the impact of storm-related losses was 95.3% (6)
Management Comments
James Petcoff, Executive Chairman and Co-CEO, commented, “While the third quarter results were affected by atypically severe storm losses, it is important to emphasize that our growing core lines of business are delivering positive results. Moreover, excluding the impact of these storm-related losses, Conifer would have achieved profitability in the quarter.”
Conifer Holdings, Inc. Page 2
November 9, 2023
2023 Third Quarter Financial Results Overview
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At and for the
Three Months Ended September 30, |
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At and for the
Nine Months Ended September 30, |
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2023 |
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2022 |
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% Change |
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2023 |
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2022 |
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% Change |
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(dollars in thousands, except share and per share amounts) |
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Gross written premiums |
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$ |
38,548 |
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$ |
33,088 |
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16.5 |
% |
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$ |
119,436 |
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$ |
103,470 |
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15.4 |
% |
Net written premiums |
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5,689 |
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23,693 |
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-76.0 |
% |
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53,359 |
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68,980 |
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-22.6 |
% |
Net earned premiums |
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23,979 |
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24,958 |
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-3.9 |
% |
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69,114 |
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73,489 |
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-6.0 |
% |
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Net investment income |
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1,450 |
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860 |
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68.6 |
% |
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4,111 |
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1,931 |
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112.9 |
% |
Net realized investment gains (losses) |
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- |
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- |
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** |
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- |
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(1,505 |
) |
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** |
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Change in fair value of equity investments |
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(87 |
) |
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(151 |
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42.4 |
% |
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595 |
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446 |
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33.4 |
% |
Gain from sale of renewal rights |
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2,335 |
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- |
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2,335 |
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- |
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Other gains (losses) |
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- |
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66 |
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** |
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- |
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60 |
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** |
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Net income (loss) |
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(2,706 |
) |
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(1,523 |
) |
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** |
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(6,444 |
) |
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(12,792 |
) |
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** |
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Net income (loss) per share, diluted |
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$ |
(0.22 |
) |
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$ |
(0.14 |
) |
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$ |
(0.53 |
) |
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$ |
(1.26 |
) |
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Adjusted operating income (loss)* |
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(4,954 |
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(1,438 |
) |
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** |
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(9,374 |
) |
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(11,793 |
) |
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** |
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Adjusted operating income (loss) per
share, diluted* |
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$ |
(0.41 |
) |
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$ |
(0.13 |
) |
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** |
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$ |
(0.77 |
) |
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$ |
(1.16 |
) |
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** |
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Book value per common share outstanding |
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$ |
0.96 |
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$ |
1.32 |
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$ |
0.96 |
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$ |
1.32 |
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Weighted average shares outstanding, basic
and diluted |
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12,222,881 |
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11,101,194 |
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12,219,713 |
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10,178,975 |
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Underwriting ratios: |
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Loss ratio (1) |
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86.9 |
% |
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66.6 |
% |
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77.8 |
% |
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77.2 |
% |
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Expense ratio (2) |
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33.9 |
% |
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39.9 |
% |
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36.3 |
% |
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38.8 |
% |
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Combined ratio (3) |
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120.8 |
% |
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106.5 |
% |
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114.1 |
% |
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116.0 |
% |
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* The "Definitions of Non-GAAP Measures" section of this release defines and reconciles data that are not based on generally accepted accounting principles. |
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** Percentage is not meaningful |
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(1) The loss ratio is the ratio, expressed as a percentage, of net losses and loss adjustment expenses to net earned premiums and other income from underwriting operations. |
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(2) The expense ratio is the ratio, expressed as a percentage, of policy acquisition costs and other underwriting expenses to net earned premiums and other income from underwriting operations. |
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(3) The combined ratio is the sum of the loss ratio and the expense ratio. A combined ratio under 100% indicates an underwriting profit. A combined ratio over 100% indicates an underwriting loss. |
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2023 Third Quarter Premiums
Gross Written Premiums
Gross written premiums increased 16.5% in the third quarter of 2023 to $38.5 million, compared to $33.1 million in the prior year period. This top line growth derived primarily from continued expansion within select key verticals that have demonstrated strong performance. By narrowing the focus to these historically profitable core lines of business, the Company not only minimizes risk exposure, but is also able to reap maximum returns from existing underwriting expertise.
The Company’s small business program continues to lead the way in this regard, comprising 81.9% of commercial lines premium and 60.6% of overall GWP for the third quarter. Conifer’s low-value home/dwelling lines of business have shown strong historical performance, and were major contributors to the overall growth in personal lines premium.
Conifer Holdings, Inc. Page 3
November 9, 2023
Net Earned Premium
Net earned premium decreased 3.9% to $24.0 million in the third quarter of 2023, compared to $25.0 million for the prior year period.
Commercial Lines Financial and Operational Review
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Commercial Lines Financial Review |
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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2023 |
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2022 |
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% Change |
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2023 |
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2022 |
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% Change |
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(dollars in thousands) |
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Gross written premiums |
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$ |
28,492 |
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$ |
27,635 |
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3.1 |
% |
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$ |
92,228 |
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$ |
88,297 |
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4.5 |
% |
Net written premiums |
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(3,155 |
) |
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18,730 |
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-116.8 |
% |
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29,571 |
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55,456 |
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-46.7 |
% |
Net earned premiums |
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17,315 |
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20,789 |
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-16.7 |
% |
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51,925 |
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62,097 |
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-16.4 |
% |
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Underwriting ratios: |
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Loss ratio |
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88.8 |
% |
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64.0 |
% |
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76.0 |
% |
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80.0 |
% |
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Expense ratio |
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31.7 |
% |
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39.6 |
% |
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35.1 |
% |
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38.0 |
% |
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Combined ratio |
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120.5 |
% |
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103.6 |
% |
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111.1 |
% |
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118.0 |
% |
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Contribution to combined ratio from net
(favorable) adverse prior year development |
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23.3 |
% |
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13.2 |
% |
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7.9 |
% |
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28.4 |
% |
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Accident year combined ratio (non-GAAP) (4) |
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97.2 |
% |
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90.4 |
% |
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103.2 |
% |
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89.6 |
% |
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Impact from storms |
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- |
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- |
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1.9 |
% |
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- |
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Accident year combined ratio
before impact of storms (non-GAAP) (4) |
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97.2 |
% |
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90.4 |
% |
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101.3 |
% |
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89.6 |
% |
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(4) The accident year combined ratio is the sum of the loss ratio and the expense ratio, less changes in net ultimate loss estimates from prior accident year loss reserves. The accident year combined ratio provides management with an assessment of the specific policy year's profitability and assists management in their evaluation of product pricing levels and quality of business written. The accident year combined ratio is a non-GAAP measure.
We presented the accident year combined ratio for the three and nine months ended September 30, 2023, before the $0 and $967,000 of severe storm losses, due to the significant variance relative to our historical and expected future losses. The accident year combined ratio before impact of storms is a non-GAAP measure. |
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The Company’s commercial lines of business represented 73.9% of total gross written premium in the third quarter of 2023. Conifer redoubled its commitment to strategically maintaining and broadening its reach within select key verticals where the Company has deep underwriting knowledge and experience. This expertise-driven approach provides the foundation for current and future profitable growth.
Commercial lines gross written premium increased 3.1% in the third quarter of 2023 to $28.5 million, as Conifer continues to execute on its strategy of maintaining organic growth in historically profitable lines of business.
Conifer Holdings, Inc. Page 4
November 9, 2023
The Commercial lines accident year combined ratio was 97.2% for the three months ended September 30, 2023. As the residual impact of deemphasized lines continues to decrease, the Company expects to report profitable performance from currently growing key select verticals.
The expense ratio was 31.7% for the third quarter of 2023, marking significant improvement of 790 basis points from the prior year period, and beating the Company’s 35% target.
Personal Lines Financial and Operational Review
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Personal Lines Financial Review |
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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2023 |
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2022 |
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% Change |
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2023 |
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2022 |
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% Change |
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(dollars in thousands) |
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Gross written premiums |
|
$ |
10,056 |
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$ |
5,453 |
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84.4 |
% |
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$ |
27,208 |
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$ |
15,173 |
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79.3 |
% |
Net written premiums |
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|
8,844 |
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|
4,963 |
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78.2 |
% |
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|
23,788 |
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|
13,524 |
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75.9 |
% |
Net earned premiums |
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|
6,664 |
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|
4,169 |
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59.8 |
% |
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|
17,189 |
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|
11,392 |
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50.9 |
% |
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Underwriting ratios: |
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Loss ratio |
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82.0 |
% |
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79.2 |
% |
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83.3 |
% |
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61.8 |
% |
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|
Expense ratio |
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|
39.7 |
% |
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41.3 |
% |
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39.9 |
% |
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43.1 |
% |
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|
Combined ratio |
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121.7 |
% |
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120.5 |
% |
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123.2 |
% |
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104.9 |
% |
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Contribution to combined ratio from net
(favorable) adverse prior year development |
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-6.3 |
% |
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9.1 |
% |
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-6.8 |
% |
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3.8 |
% |
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Accident year combined ratio (non-GAAP) (5) |
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128.0 |
% |
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|
111.4 |
% |
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|
|
130.0 |
% |
|
|
101.1 |
% |
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|
|
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|
Impact from storms |
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37.5 |
% |
|
|
- |
|
|
|
|
|
|
40.3 |
% |
|
|
- |
|
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|
Accident year combined ratio
before impact of storms (non-GAAP) (5) |
|
|
|
|
|
|
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|
|
|
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|
|
|
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|
|
|
90.5 |
% |
|
|
111.4 |
% |
|
|
|
|
|
89.7 |
% |
|
|
101.1 |
% |
|
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|
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(5) The accident year combined ratio is the sum of the loss ratio and the expense ratio, less changes in net ultimate loss estimates from prior accident year loss reserves. The accident year combined ratio provides management with an assessment of the specific policy year's profitability and assists management in their evaluation of product pricing levels and quality of business written. The accident year combined ratio is a non-GAAP measure.
We presented the accident year combined ratio for the three and nine months ended September 30, 2023, before the $2.5 million and $7.0 million of severe storm losses, due to the significant variance relative to our historical and expected future losses. The accident year combined ratio before impact of storms is a non-GAAP measure. |
|
Personal lines, representing 26.1% of total gross written premium for the third quarter of 2023, consists mainly of low-value home/dwelling insurance products. Gross written premium in personal lines was $10.1 million for the third quarter of 2023.
Personal lines combined ratio was 121.7% for the three months ended September 30, 2023. Severe convective storms in Oklahoma that led to industry-wide losses were also predominantly responsible for Conifer’s elevated combined ratio in the third quarter.
Conifer Holdings, Inc. Page 5
November 9, 2023
Before the impact of these storm-related losses, the personal lines accident year combined ratio was 90.5% for the third quarter, and 89.7% for the nine months ended September 30, 2023.
Combined Ratio Analysis
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
|
2023 |
|
|
2022 |
|
|
|
2023 |
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Underwriting ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss ratio |
|
|
86.9 |
% |
|
|
66.6 |
% |
|
|
|
77.8 |
% |
|
|
77.2 |
% |
|
Expense ratio |
|
|
33.9 |
% |
|
|
39.9 |
% |
|
|
|
36.3 |
% |
|
|
38.8 |
% |
|
Combined ratio |
|
|
120.8 |
% |
|
|
106.5 |
% |
|
|
|
114.1 |
% |
|
|
116.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contribution to combined ratio from net (favorable)
adverse prior year development |
|
|
15.0 |
% |
|
|
12.6 |
% |
|
|
|
4.2 |
% |
|
|
24.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accident year combined ratio (non-GAAP) (6) |
|
|
105.8 |
% |
|
|
93.9 |
% |
|
|
|
109.9 |
% |
|
|
91.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact from storms |
|
|
10.5 |
% |
|
|
- |
|
|
|
|
11.5 |
% |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accident year combined ratio
before impact of storms (non-GAAP) (6) |
|
95.3 |
% |
|
|
93.9 |
% |
|
|
|
98.4 |
% |
|
|
91.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6) The accident year combined ratio is the sum of the loss ratio and the expense ratio, less changes in net ultimate loss estimates from prior accident year loss reserves. The accident year combined ratio provides management with an assessment of the specific policy year's profitability and assists management in their evaluation of product pricing levels and quality of business written. The accident year combined ratio is a non-GAAP measure.
We presented the accident year combined ratio for the three and nine months ended September 30, 2023, before the $2.5 million and $7.9 million of severe storm losses, due to the significant variance relative to our historical and expected future losses. The accident year combined ratio before impact of storms is a non-GAAP measure. |
|
|
Combined Ratio:
The Company's combined ratio was 120.8% for the three months ended September 30, 2023. Before the impact of storm losses as described above, the Company’s accident year combined ratio was 95.3% for the quarter.
Loss Ratio:
The Company’s losses and loss adjustment expenses were $20.9 million for the third quarter and $53.9 million for the nine months ended September 30, 2023, down from $56.9 million in the prior year period.
Expense Ratio:
The expense ratio exhibited significant improvement in the third quarter, due in large part to the Company’s sustained emphasis on expense management: the expense ratio for the third quarter of
Conifer Holdings, Inc. Page 6
November 9, 2023
2023 was 33.9%, down from 39.9% in the prior year period and below the Company’s near-term target of 35%.
Net Investment Income
Net investment income was $1.5 million during the quarter ended September 30, 2023, up 68.6% compared to $860,000 in the prior year period.
Net Realized Investment Gains (Losses)
The Company did not have any realized investment gains or losses during the third quarter or nine months ended September 30, 2023. Net realized investment losses were $1.5 million for the first nine months of 2022.
Change in Fair Value of Equity Securities
During the quarter, the Company reported a loss of $87,000 from the change in fair value of equity investments, compared to a loss of $151,000 in the prior year period.
Net Income (Loss)
The Company reported net loss of $2.7 million, or $0.22 per share, for the third quarter of 2023; compared to a net loss of $1.5 million, or $0.14 per share, in the prior year period.
Adjusted Operating Income (Loss)
In the third quarter of 2023, the Company reported an adjusted operating loss of $5.0 million, or $0.41 per share, compared to an adjusted operating loss of $1.4 million, or $0.13 per share, for the same period in 2022. See Definitions of Non-GAAP Measures.
Earnings Conference Call with Accompanying Slide Presentation
The Company will hold a conference call/webcast on Friday, November 10, 2023 at 8:30 a.m. ET to discuss results for the third quarter ended September 30, 2023.
Investors, analysts, employees and the general public are invited to listen to the conference call via:
Webcast: On the Event Calendar at IR.CNFRH.com
Conference Call: 844-868-8843 (domestic) or 412-317-6589 (international)
The webcast will be archived on the Conifer Holdings website and available for replay for at least one year.
About Conifer Holdings
Conifer Holdings, Inc. is a specialty insurance holding company, offering customized coverage solutions tailored to the needs of our insureds nationwide. Conifer is traded on the NASDAQ exchange under the symbol “CNFR”. Additional information is available on the Company’s website at www.CNFRH.com.
Conifer Holdings, Inc. Page 7
November 9, 2023
Definitions of Non-GAAP Measures
Conifer prepares its public financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP). Statutory data is prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners' (NAIC) Accounting Practices and Procedures Manual, and therefore is not reconciled to GAAP data.
We believe that investors’ understanding of Conifer’s performance is enhanced by our disclosure of adjusted operating income. Our method for calculating this measure may differ from that used by other companies and therefore comparability may be limited. We define adjusted operating income (loss), a non-GAAP measure, as net income (loss) excluding the after-tax amounts of: 1) Net realized investment gains and losses, 2) Change in fair value of equity securities, 3) Gain on sale of renewal rights and 4) Other gains (losses). We use adjusted operating income as an internal performance measure in the management of our operations because we believe it gives our management and other users of our financial information useful insight into our results of operations and our underlying business performance.
Reconciliations of adjusted operating income and adjusted operating income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30, |
|
|
Nine Months Ended
September 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
|
(dollar in thousands, except share and per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
(2,706 |
) |
|
$ |
(1,523 |
) |
|
$ |
(6,444 |
) |
|
$ |
(12,792 |
) |
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
Net realized investment gains (losses), net of tax |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(1,505 |
) |
Change in fair value of equity securities, net of tax |
|
|
(87 |
) |
|
|
(151 |
) |
|
|
595 |
|
|
|
446 |
|
Gain from sale of renewal rights |
|
|
2,335 |
|
|
|
- |
|
|
|
2,335 |
|
|
|
- |
|
Other gains (losses), net of tax |
|
|
- |
|
|
|
66 |
|
|
|
- |
|
|
|
60 |
|
Adjusted operating income (loss) |
|
$ |
(4,954 |
) |
|
$ |
(1,438 |
) |
|
$ |
(9,374 |
) |
|
$ |
(11,793 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares, diluted |
|
|
12,222,881 |
|
|
|
11,101,194 |
|
|
|
12,219,713 |
|
|
|
10,178,975 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(0.22 |
) |
|
$ |
(0.14 |
) |
|
$ |
(0.53 |
) |
|
$ |
(1.26 |
) |
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
Net realized investment gains (losses), net of tax |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(0.15 |
) |
Change in fair value of equity securities, net of tax |
|
|
- |
|
|
|
(0.01 |
) |
|
|
0.05 |
|
|
|
0.04 |
|
Gain from sale of renewal rights |
|
|
0.19 |
|
|
|
- |
|
|
|
0.19 |
|
|
|
- |
|
Other gains (losses), net of tax |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
0.01 |
|
Adjusted operating income (loss), per share |
|
$ |
(0.41 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.77 |
) |
|
$ |
(1.16 |
) |
Conifer Holdings, Inc. Page 8
November 9, 2023
Forward-Looking Statement
This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give current expectations or forecasts of future events or our future financial or operating performance, and include Conifer’s expectations regarding premiums, earnings, its capital position, expansion, and growth strategies. The forward-looking statements contained in this press release are based on management’s good-faith belief and reasonable judgment based on current information. The forward-looking statements are qualified by important factors, risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from those in the forward-looking statements, including those described in our form 10-K (“Item 1A Risk Factors”) filed with the SEC on March 27, 2023 and subsequent reports filed with or furnished to the SEC. Any forward-looking statement made by us in this report speaks only as of the date hereof or as of the date specified herein. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by any applicable laws or regulations.
Conifer Holdings, Inc. Page 9
November 9, 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conifer Holdings, Inc. and Subsidiaries |
|
Consolidated Balance Sheets |
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
September 30, |
|
|
December 31, |
|
|
|
2023 |
|
|
2022 |
|
Assets |
|
(Unaudited) |
|
|
|
|
Investment securities: |
|
|
|
|
|
|
Debt securities, at fair value (amortized cost of $119,499
and $127,119, respectively) |
|
$ |
101,745 |
|
|
$ |
110,201 |
|
Equity securities, at fair value (cost of $2,387 and $1,905, respectively) |
|
|
2,345 |
|
|
|
1,267 |
|
Short-term investments, at fair value |
|
|
40,523 |
|
|
|
25,929 |
|
Total investments |
|
|
144,613 |
|
|
|
137,397 |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
14,361 |
|
|
|
28,035 |
|
Premiums and agents' balances receivable, net |
|
|
24,512 |
|
|
|
21,802 |
|
Receivable from Affiliate |
|
|
889 |
|
|
|
1,261 |
|
Reinsurance recoverables on unpaid losses |
|
|
46,766 |
|
|
|
82,651 |
|
Reinsurance recoverables on paid losses |
|
|
6,959 |
|
|
|
6,653 |
|
Prepaid reinsurance premiums |
|
|
43,132 |
|
|
|
16,399 |
|
Deferred policy acquisition costs |
|
|
5,737 |
|
|
|
10,290 |
|
Other assets |
|
|
6,474 |
|
|
|
7,862 |
|
Total assets |
|
$ |
293,443 |
|
|
$ |
312,350 |
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
|
Unpaid losses and loss adjustment expenses |
|
$ |
139,214 |
|
|
$ |
165,539 |
|
Unearned premiums |
|
|
78,865 |
|
|
|
67,887 |
|
Reinsurance premiums payable |
|
|
4,727 |
|
|
|
6,144 |
|
Debt |
|
|
25,264 |
|
|
|
33,876 |
|
Funds held under reinsurance agreements |
|
|
26,541 |
|
|
|
11084 |
|
Accounts payable and accrued expenses |
|
|
7,041 |
|
|
|
8,870 |
|
Total liabilities |
|
|
281,652 |
|
|
|
293,400 |
|
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
Shareholders' equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock, no par value (100,000,000 shares authorized; 12,222,881 and
12,215,849 issued and outstanding, respectively) |
|
|
98,057 |
|
|
|
97,913 |
|
Accumulated deficit |
|
|
(67,204 |
) |
|
|
(60,760 |
) |
Accumulated other comprehensive income (loss) |
|
|
(19,062 |
) |
|
|
(18,203 |
) |
Total shareholders' equity |
|
|
11,791 |
|
|
|
18,950 |
|
Total liabilities and shareholders' equity |
|
$ |
293,443 |
|
|
$ |
312,350 |
|
Conifer Holdings, Inc. Page 10
November 9, 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conifer Holdings, Inc. and Subsidiaries |
|
|
|
|
|
|
|
|
Consolidated Statements of Operations (Unaudited) |
|
|
|
|
|
|
|
|
(dollars in thousands, except share and per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
|
September 30, |
|
|
September 30, |
|
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue and Other Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
Premiums |
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross earned premiums |
|
$ |
38,150 |
|
|
$ |
34,401 |
|
|
$ |
108,457 |
|
|
$ |
100,947 |
|
|
Ceded earned premiums |
|
|
(14,171 |
) |
|
|
(9,443 |
) |
|
|
(39,343 |
) |
|
|
(27,458 |
) |
|
Net earned premiums |
|
|
23,979 |
|
|
|
24,958 |
|
|
|
69,114 |
|
|
|
73,489 |
|
|
Net investment income |
|
|
1,450 |
|
|
|
860 |
|
|
|
4,111 |
|
|
|
1,931 |
|
|
Net realized investment gains (losses) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(1,505 |
) |
|
Change in fair value of equity securities |
|
|
(87 |
) |
|
|
(151 |
) |
|
|
595 |
|
|
|
446 |
|
|
Gain from sale of renewal rights |
|
|
2,335 |
|
|
|
- |
|
|
|
2,335 |
|
|
|
- |
|
|
Other gains (losses) |
|
|
- |
|
|
|
66 |
|
|
|
- |
|
|
|
60 |
|
|
Other income |
|
|
439 |
|
|
|
603 |
|
|
|
1,463 |
|
|
|
1,964 |
|
|
Total revenue and other income |
|
|
28,116 |
|
|
|
26,336 |
|
|
|
77,618 |
|
|
|
76,385 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Losses and loss adjustment expenses, net |
|
|
20,911 |
|
|
|
16,671 |
|
|
|
53,943 |
|
|
|
56,940 |
|
|
Policy acquisition costs |
|
|
4,725 |
|
|
|
6,230 |
|
|
|
13,859 |
|
|
|
17,419 |
|
|
Operating expenses |
|
|
4,403 |
|
|
|
4,380 |
|
|
|
13,796 |
|
|
|
13,010 |
|
|
Interest expense |
|
|
855 |
|
|
|
778 |
|
|
|
2,361 |
|
|
|
2,216 |
|
|
Total expenses |
|
|
30,894 |
|
|
|
28,059 |
|
|
|
83,959 |
|
|
|
89,585 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before equity earnings in Affiliate and income taxes |
|
|
(2,778 |
) |
|
|
(1,723 |
) |
|
|
(6,341 |
) |
|
|
(13,200 |
) |
|
Equity earnings (loss) in Affiliate, net of tax |
|
|
72 |
|
|
|
199 |
|
|
|
(103 |
) |
|
|
368 |
|
|
Income tax expense (benefit) |
|
|
- |
|
|
|
(1 |
) |
|
|
- |
|
|
|
(40 |
) |
|
Net income (loss) |
|
|
(2,706 |
) |
|
|
(1,523 |
) |
|
|
(6,444 |
) |
|
|
(12,792 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per common share, |
|
|
|
|
|
|
|
|
|
|
|
|
|
basic and diluted |
|
$ |
(0.22 |
) |
|
$ |
(0.14 |
) |
|
$ |
(0.53 |
) |
|
$ |
(1.26 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding, |
|
|
|
|
|
|
|
|
|
|
|
|
|
basic and diluted |
|
|
12,222,881 |
|
|
|
11,101,194 |
|
|
|
12,219,713 |
|
|
|
10,178,975 |
|
|
v3.23.3
Document and Entity Information
|
Nov. 09, 2023 |
| Document Information [Line Items] |
|
| Document Type |
8-K
|
| Amendment Flag |
false
|
| Entity Registrant Name |
Conifer Holdings Inc.
|
| Entity Central Index Key |
0001502292
|
| Document Period End Date |
Nov. 09, 2023
|
| Entity Emerging Growth Company |
false
|
| Entity File Number |
001-37536
|
| Entity Incorporation, State or Country Code |
MI
|
| Entity Tax Identification Number |
27-1298795
|
| Entity Address, Address Line One |
3001 West Big Beaver
|
| Entity Address, Address Line Two |
Suite 200
|
| Entity Address, City or Town |
Troy
|
| Entity Address, State or Province |
MI
|
| Entity Address, Postal Zip Code |
48084
|
| City Area Code |
248
|
| Local Phone Number |
559-0840
|
| Written Communications |
false
|
| Soliciting Material |
false
|
| Pre-commencement Tender Offer |
false
|
| Pre-commencement Issuer Tender Offer |
false
|
| Common Stock, No Par Value |
|
| Document Information [Line Items] |
|
| Title of each class |
Common Stock, no par value
|
| Trading Symbol(s) |
CNFR
|
| Name of each exchange on which registered |
NASDAQ
|
| 9.75% Senior Notes due 2028 |
|
| Document Information [Line Items] |
|
| Title of each class |
9.75% Senior Notes due 2028
|
| Trading Symbol(s) |
CNFRZ
|
| Name of each exchange on which registered |
NASDAQ
|
| X |
- DefinitionBoolean flag that is true when the XBRL content amends previously-filed or accepted submission.
| Name: |
dei_AmendmentFlag |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionFor the EDGAR submission types of Form 8-K: the date of the report, the date of the earliest event reported; for the EDGAR submission types of Form N-1A: the filing date; for all other submission types: the end of the reporting or transition period. The format of the date is YYYY-MM-DD.
| Name: |
dei_DocumentPeriodEndDate |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:dateItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionThe type of document being provided (such as 10-K, 10-Q, 485BPOS, etc). The document type is limited to the same value as the supporting SEC submission type, or the word 'Other'.
| Name: |
dei_DocumentType |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:submissionTypeItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionAddress Line 1 such as Attn, Building Name, Street Name
| Name: |
dei_EntityAddressAddressLine1 |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:normalizedStringItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionAddress Line 2 such as Street or Suite number
| Name: |
dei_EntityAddressAddressLine2 |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:normalizedStringItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- Definition
+ References
+ Details
| Name: |
dei_EntityAddressCityOrTown |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:normalizedStringItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionCode for the postal or zip code
| Name: |
dei_EntityAddressPostalZipCode |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:normalizedStringItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionName of the state or province.
| Name: |
dei_EntityAddressStateOrProvince |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:stateOrProvinceItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionA unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
| Name: |
dei_EntityCentralIndexKey |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:centralIndexKeyItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionIndicate if registrant meets the emerging growth company criteria. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
| Name: |
dei_EntityEmergingGrowthCompany |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionCommission file number. The field allows up to 17 characters. The prefix may contain 1-3 digits, the sequence number may contain 1-8 digits, the optional suffix may contain 1-4 characters, and the fields are separated with a hyphen.
| Name: |
dei_EntityFileNumber |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:fileNumberItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionTwo-character EDGAR code representing the state or country of incorporation.
| Name: |
dei_EntityIncorporationStateCountryCode |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:edgarStateCountryItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionThe exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
| Name: |
dei_EntityRegistrantName |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:normalizedStringItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionThe Tax Identification Number (TIN), also known as an Employer Identification Number (EIN), is a unique 9-digit value assigned by the IRS. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
| Name: |
dei_EntityTaxIdentificationNumber |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:employerIdItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionLocal phone number for entity.
| Name: |
dei_LocalPhoneNumber |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:normalizedStringItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 13e
-Subsection 4c
| Name: |
dei_PreCommencementIssuerTenderOffer |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14d
-Subsection 2b
| Name: |
dei_PreCommencementTenderOffer |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionTitle of a 12(b) registered security. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b
| Name: |
dei_Security12bTitle |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:securityTitleItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionName of the Exchange on which a security is registered. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection d1-1
| Name: |
dei_SecurityExchangeName |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:edgarExchangeCodeItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Section 14a
-Number 240
-Subsection 12
| Name: |
dei_SolicitingMaterial |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionTrading symbol of an instrument as listed on an exchange.
| Name: |
dei_TradingSymbol |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:tradingSymbolItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 425
| Name: |
dei_WrittenCommunications |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- Details
| Name: |
us-gaap_StatementClassOfStockAxis=cnfr_CommonStockNoParValueMember |
| Namespace Prefix: |
|
| Data Type: |
na |
| Balance Type: |
|
| Period Type: |
|
|
| X |
- Details
| Name: |
us-gaap_StatementClassOfStockAxis=cnfr_NinePointSevenFivePercentSeniorNotesDue2028Member |
| Namespace Prefix: |
|
| Data Type: |
na |
| Balance Type: |
|
| Period Type: |
|
|
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