v3.26.1
Income Taxes (Tables)
6 Months Ended
Jun. 30, 2026
Income Tax Disclosure [Abstract]  
Schedule of Provision for Income Taxes

The following table summarizes the provision for income taxes for the six months ended June 30, 2026 and 2025:

 

 

Six Months Ended June 30,

 

 

 

2026

 

 

2025

 

 

 

(in thousands)

 

Federal:

 

 

 

 

 

 

Current

 

$

26,379

 

 

$

21,021

 

Deferred

 

 

1,271

 

 

 

(786

)

Provision for Federal income tax

 

 

27,650

 

 

 

20,235

 

State:

 

 

 

 

 

 

Current

 

$

5,249

 

 

$

4,419

 

Deferred

 

 

107

 

 

 

(152

)

Provision for State income tax expense

 

 

5,356

 

 

 

4,267

 

Provision for income taxes

 

$

33,006

 

 

$

24,502

 

For the three months ended June 30, 2026 and 2025, the Company recorded income tax expense of $20.5 million and $15.0 million, respectively, resulting in effective tax rates of 24.9% and 23.8%, respectively. For the six months ended June 30, 2026 and 2025, the Company recorded income tax expense of $33.0 million and $24.5 million respectively, resulting in effective tax rates of 25.2% and 23.8%, respectively. The effective tax rate for the six months ended June 30, 2026 was modestly higher than the effective tax rate for the comparable period in 2025. The increase was primarily attributable to differences in the estimated annual pre-tax income for 2026 and 2025 and the related impact of permanent tax differences on the Company's annual effective tax rate.

The Company has
Schedule of Components of Net Deferred Tax Assets

The below table summarizes the significant components of the Company's net deferred tax assets:

 

 

June 30, 2026

 

 

December 31, 2025

 

Deferred tax assets:

 

(in thousands)

 

Unearned premiums

 

$

19,822

 

 

$

19,342

 

Tax-related discount on loss reserve

 

 

4,185

 

 

 

4,399

 

Stock-based compensation

 

 

999

 

 

 

1,323

 

Accrued expenses

 

 

812

 

 

 

1,533

 

Leases

 

 

737

 

 

 

924

 

Unrealized losses

 

 

5,711

 

 

 

4,185

 

Other

 

 

530

 

 

 

488

 

Total deferred tax asset

 

 

32,796

 

 

 

32,194

 

 

 

 

 

 

 

 

Deferred tax liabilities:

 

 

 

 

 

 

Deferred acquisition costs

 

 

16,421

 

 

 

15,379

 

Prepaid expenses

 

 

262

 

 

 

152

 

Property and equipment

 

 

2,401

 

 

 

2,738

 

Basis in purchased investments

 

 

24

 

 

 

2

 

Basis in purchased intangibles

 

 

5,995

 

 

 

6,652

 

Other

 

 

1,690

 

 

 

1,416

 

Total deferred tax liabilities

 

 

26,793

 

 

 

26,339

 

Net deferred tax assets

 

$

6,003

 

 

$

5,855