Significant Accounting Policies (Policies) |
6 Months Ended |
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Jun. 30, 2026 | |
| Accounting Policies [Abstract] | |
| Basis of Presentation | The Company has prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the Securities and Exchange Commission (“SEC”). References to the Accounting Standard Codification (“ASC”) and the Accounting Standard Updates (“ASU”) included hereinafter refer to the Accounting Standards Codification and Updates issued by the Financial Accounting Standards Board (“FASB”) as the source of the authoritative GAAP. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation have been included in these condensed consolidated financial statements.
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| Principles of Consolidation | The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly- owned subsidiaries, as well as variable interest entities (“VIE”) in which the Company is determined to be the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation.
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| Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. As a result, actual results could differ from those estimates. Management evaluates estimates on an ongoing basis when updated information related to such estimates becomes available. The most significant areas that require management judgment are the estimate of unpaid losses and loss adjustment expenses, evaluation of reinsurance recoverable, evaluation of ceding commission, and valuation of investments.
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| Restricted Stock | Restricted Stock The PSUs are subject to performance-based vesting conditions and are accounted for as equity under ASC Topic 718, Compensation—Stock Compensation. PSUs are valued based on the fair value of the underlying award, which is the closing price of the Common Stock on the date of the grant. The Company recognizes the compensation cost for PSUs on a straight-line basis over the awards’ three-year vesting period as general and administrative expenses within the Company’s condensed consolidated statements of operations and comprehensive income. The PSUs were granted assuming expected maximum achievement of the applicable performance conditions. Accordingly, compensation cost is subject to decreases based on the Company’s actual performance relative to the established metrics for each performance year. The Company recognizes any PSU forfeitures when they occur.
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| Recently Issued and Adopted Accounting Pronouncements, Recently Issued Accounting Pronouncements Not Yet Adopted, and Revision of Previously Issued Financial Statements | Recently Issued and Adopted Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which amended the guidance in ASC 280, Segment Reporting, to require a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. Public entities with a single reportable segment are required to provide the new disclosures and all the disclosures required under ASC 280. The guidance is applied retrospectively to all periods presented in financial statements, unless it is impracticable. The guidance applies to all public entities and is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. The Company adopted ASU 2023-07 for its 2024 year-end. The adoption of the ASU did not have a material impact on the condensed consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which amended the guidance in ASC 740 to enhance the transparency and decision-usefulness of income tax disclosures, particularly in the rate reconciliation table and disclosures about income taxes paid. The guidance applies to all entities subject to income taxes and permits either prospective or retrospective application. For public business entities, the new requirements are effective for annual periods beginning after December 15, 2024. The Company adopted ASU 2023-09 on a prospective basis beginning with the year ended December 31, 2025. The adoption did not have a material impact on the Company’s condensed consolidated financial condition or results of operations, but resulted in additional income tax disclosures in the consolidated financial statements. In September 2025, the FASB issued ASU No. 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which provides updated guidance on the recognition, measurement, and disclosure of costs incurred in connection with internally developed software. The new standard is intended to align accounting practices for software that is developed in-house with recent advancements in technology and current industry practices. ASU 2025-06 is effective for annual reporting periods beginning after December 15, 2027, and interim periods within those annual periods, with early adoption permitted. The Company adopted ASU 2025-06 on January 1, 2026 using the prospective method. The adoption of the ASU did not have a material impact on the condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income— Expense Disaggregation Disclosures (Subtopic 220-40). This ASU requires disaggregated disclosure of income statement expenses, such as employee compensation and depreciation, for public business entities. The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the condensed consolidated financial statements. The ASU also requires disclosure of a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. ASU 2024-03 is effective for all public business entities for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company will adopt the guidance on December 31, 2027, and is currently assessing the impact of this ASU on the consolidated financial statements and related disclosures. In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies the guidance in Topic 270 to improve the consistency of interim financial reporting. The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for annual reporting periods beginning after December 15, 2027 and interim periods within those annual periods. Early adoption is permitted. The Company is currently evaluating the impact of ASU 2025-11 on its consolidated financial statements and related disclosures. Revision of Previously Issued Financial Statements The Company identified a revision related to the measurement of unearned ceding commissions and reinsurance payable associated with the net quota share reinsurance agreement. The Company revised the presentation of both items as of December 31, 2025 from what was previously presented. The revision relates to the amounts reported as unearned ceding commission in Note 7 – “Deferred Policy Acquisition Costs, Net of Ceding Commissions,” reported in the Consolidated Financial Statements as of December 31, 2025. The revision is a result of an overstatement of the unearned ceding commission and an understatement of the reinsurance payable in the Consolidated Financial Statements. The Company evaluated the error in accordance with ASC 250, Accounting Changes and Error Corrections, and the SEC’s guidance on assessing materiality, including Staff Accounting Bulletin (“SAB”) No. 99, Materiality, and SAB No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. The Company concluded that the error was not material to any previously issued annual or interim financial statements. Accordingly, the Company has revised the comparative prior-period financial information presented herein to correct the error. The revision reduced the previously reported unearned ceding commission and the related reinsurance payable balances. As a result, deferred policy acquisition costs, net of unearned ceding commissions, increased by $18,029 with a corresponding increase in reinsurance payable as of December 31, 2025. The revision increased both total assets and total liabilities by $5,127 as of December 31, 2025. The revision did not have an impact on shareholders’ equity, revenue, expenses, net income, or net cash provided by operating activities. The Company also revised the previously reported unearned ceding commission and the related net reinsurance commission receivable balances as of March 31, 2026. As a result, deferred policy acquisition costs, net of unearned ceding commissions, increased by $18,029 with a corresponding decrease in net reinsurance commission receivable as of March 31, 2026. The revision decreased both total assets and total liabilities by $8,804 as of March 31, 2026. The revision did not have an impact on shareholders’ equity, revenue, expenses, net income, or net cash provided by operating activities. In accordance with our Compensation Recovery Policy, the Compensation Committee of the Board of Directors reviewed the revised financial statements and concluded that there was no recovery of erroneously awarded compensation required under the Compensation Recovery Policy because the revised financial statements did not impact the amount of any incentive-based compensation received by our executive officers on or after the dates covered by the revised financial statements.
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