AMERICAN COASTAL INSURANCE CorpACIC
AMERICAN COASTAL INSURANCE Corp Segments Disclosure
) SEGMENT REPORTING
Commercial Lines Business
Our commercial lines business primarily provides commercial multi-peril property insurance for residential condominium associations and apartments in Florida, through our subsidiary AmCoastal. We include coverage to policyholders for loss or damage to buildings, inventory or equipment caused by covered causes of loss such as fire, wind, hail, water, theft and vandalism. We also wrote commercial residential coverage through our subsidiary JIC, in South Carolina and Texas. Effective June 1, 2022, JIC was merged into AmCoastal, with AmCoastal being the surviving entity. As a result, the commercial residential policies originally written by JIC were not renewed effective May 31, 2022.
All of our commercial lines business is administered by an outside managing general underwriter, AmRisc, LLC (AmRisc). This includes handling the underwriting, claims processing and premium collection related to our commercial business. In return, AmRisc is reimbursed through monthly management fees. International Catastrophe Insurance Managers (ICAT) handled the underwriting and premium collection for JIC’s commercial business written in South Carolina and Texas and was also reimbursed through monthly management fees. Effective May 31, 2022, the Company terminated its agreement with ICAT.
Personal Lines Business
Our personal lines business provides structure, content and liability coverage for standard single-family homeowners, renters and condominium unit owners, through our subsidiary IIC. Personal residential products are offered in New York. We include coverage to policyholders for loss or damage to dwellings, detached structures or equipment caused by covered causes of loss such as fire, wind, hail, water, theft and vandalism.
Please note the following similarities pertaining to the accounting and transactions of our operating segments for the years ended December 31, 2023, 2022 and 2021:
•Neither operating segment experienced significant noncash transactions outside of depreciation and amortization for any years presented.
The tables below present the information for each of the reportable segments profit or loss for the years ended December 31, 2023, 2022 and 2021.
Year Ended December 31, 2023 | ||||||||||||||||||||||||||
| Commercial | Personal (1) | Adjustments | Consolidated | |||||||||||||||||||||||
| REVENUE: | ||||||||||||||||||||||||||
| Gross premiums written | $ | 635,709 | $ | 34,334 | $ | — | $ | 670,043 | ||||||||||||||||||
| Change in gross unearned premiums | (40,993) | 6,914 | — | (34,079) | ||||||||||||||||||||||
| Gross premiums earned | 594,716 | 41,248 | — | 635,964 | ||||||||||||||||||||||
| Ceded premiums earned | (342,664) | (11,416) | — | (354,080) | ||||||||||||||||||||||
| Net premiums earned | 252,052 | 29,832 | — | 281,884 | ||||||||||||||||||||||
| Net investment income | 7,356 | 3,119 | 99 | 10,574 | ||||||||||||||||||||||
| Net realized investment losses | (6,790) | (18) | — | (6,808) | ||||||||||||||||||||||
| Net unrealized gains on equity securities | 813 | — | 1 | 814 | ||||||||||||||||||||||
| Other revenue | — | 79 | — | 79 | ||||||||||||||||||||||
| Total revenues | 253,431 | 33,012 | 100 | 286,543 | ||||||||||||||||||||||
| EXPENSES: | ||||||||||||||||||||||||||
| Losses and loss adjustment expenses | 46,299 | 16,562 | — | 62,861 | ||||||||||||||||||||||
| Policy acquisition costs | 75,436 | 7,910 | — | 83,346 | ||||||||||||||||||||||
| Operating expenses | 3,008 | 6,809 | 423 | 10,240 | ||||||||||||||||||||||
| General and administrative expenses | 10,620 | 17,979 | 890 | 29,489 | ||||||||||||||||||||||
| Interest expense | — | — | 10,875 | 10,875 | ||||||||||||||||||||||
| Total expenses | 135,363 | 49,260 | 12,188 | 196,811 | ||||||||||||||||||||||
| Income (loss) before other income | 118,068 | (16,248) | (12,088) | 89,732 | ||||||||||||||||||||||
| Other income (loss) | 60 | 2,394 | (215) | 2,239 | ||||||||||||||||||||||
| Income (loss) before income taxes | $ | 118,128 | $ | (13,854) | (12,303) | 91,971 | ||||||||||||||||||||
| Provision for income taxes | 9,773 | 9,773 | ||||||||||||||||||||||||
| Net income (loss) | $ | (22,076) | $ | 82,198 | ||||||||||||||||||||||
| Less: Net loss attributable to noncontrolling interests | — | — | ||||||||||||||||||||||||
| Net income (loss) attributable to ACIC | $ | (22,076) | $ | 82,198 | ||||||||||||||||||||||
Loss ratio, net (2) (3) | 18.4 | % | 55.5 | % | 22.3 | % | ||||||||||||||||||||
Expense ratio (2) (4) | 35.3 | % | 109.6 | % | 43.7 | % | ||||||||||||||||||||
Combined ratio (2) (5) | 53.7 | % | 165.1 | % | 66.0 | % | ||||||||||||||||||||
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations.
(2) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below.
(3) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses.
(4) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses.
(5) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
Year Ended December 31, 2022 | ||||||||||||||||||||||||||
| Commercial | Personal (1) | Adjustments | Consolidated | |||||||||||||||||||||||
| REVENUE: | ||||||||||||||||||||||||||
| Gross premiums written | $ | 508,243 | $ | 64,100 | $ | — | $ | 572,343 | ||||||||||||||||||
| Change in gross unearned premiums | (44,029) | 7,055 | — | (36,974) | ||||||||||||||||||||||
| Gross premiums earned | 464,214 | 71,155 | — | 535,369 | ||||||||||||||||||||||
| Ceded premiums earned | (245,293) | (20,730) | — | (266,023) | ||||||||||||||||||||||
| Net premiums earned | 218,921 | 50,425 | — | 269,346 | ||||||||||||||||||||||
| Net investment income | 5,861 | 1,759 | 53 | 7,673 | ||||||||||||||||||||||
| Net realized investment gains (losses) | (6,511) | 28 | — | (6,483) | ||||||||||||||||||||||
| Net unrealized losses on equity securities | (1,966) | — | (2) | (1,968) | ||||||||||||||||||||||
| Other revenue | 1,178 | 42 | 3 | 1,223 | ||||||||||||||||||||||
| Total revenues | 217,483 | 52,254 | 54 | 269,791 | ||||||||||||||||||||||
| EXPENSES: | ||||||||||||||||||||||||||
| Losses and loss adjustment expenses | 87,143 | 47,662 | — | 134,805 | ||||||||||||||||||||||
| Policy acquisition costs | 80,996 | 14,322 | — | 95,318 | ||||||||||||||||||||||
| Operating expenses | 3,926 | 9,367 | 436 | 13,729 | ||||||||||||||||||||||
| General and administrative expenses | 9,579 | 31,282 | 1,420 | 42,281 | ||||||||||||||||||||||
| Interest expense | — | 1 | 9,482 | 9,483 | ||||||||||||||||||||||
| Total expenses | 181,644 | 102,634 | 11,338 | 295,616 | ||||||||||||||||||||||
| Income (loss) before other income | 35,839 | (50,380) | (11,284) | (25,825) | ||||||||||||||||||||||
| Other income | 2 | (1,774) | 12,115 | 10,343 | ||||||||||||||||||||||
| Income (loss) before income taxes | $ | 35,841 | $ | (52,154) | 831 | (15,482) | ||||||||||||||||||||
| Provision for income taxes | 24,522 | 24,522 | ||||||||||||||||||||||||
| Net income (loss) | $ | (23,691) | $ | (40,004) | ||||||||||||||||||||||
| Less: Net loss attributable to noncontrolling interests | (111) | (111) | ||||||||||||||||||||||||
| Net income (loss) attributable to ACIC | $ | (23,580) | $ | (39,893) | ||||||||||||||||||||||
Loss ratio, net (2) (3) | 39.8 | % | 94.5 | % | 50.0 | % | ||||||||||||||||||||
Expense ratio (2) (4) | 43.2 | % | 109.0 | % | 56.2 | % | ||||||||||||||||||||
Combined ratio (2) (5) | 83.0 | % | 203.5 | % | 106.2 | % | ||||||||||||||||||||
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items as these subsidiaries directly support our personal lines operations.
(2) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below.
(3) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses.
(4) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses.
(5) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
Year Ended December 31, 2021 | ||||||||||||||||||||||||||
| Commercial | Personal (1) | Adjustments | Consolidated | |||||||||||||||||||||||
| REVENUE: | ||||||||||||||||||||||||||
| Gross premiums written | $ | 422,238 | $ | 62,289 | $ | — | $ | 484,527 | ||||||||||||||||||
| Change in gross unearned premiums | (11,975) | (6,793) | — | (18,768) | ||||||||||||||||||||||
| Gross premiums earned | 410,263 | 55,496 | — | 465,759 | ||||||||||||||||||||||
| Ceded premiums earned | (237,056) | (7,574) | — | (244,630) | ||||||||||||||||||||||
| Net premiums earned | 173,207 | 47,922 | — | 221,129 | ||||||||||||||||||||||
| Net investment income | 4,764 | 1,091 | 46 | 5,901 | ||||||||||||||||||||||
| Net realized investment gains (losses) | (34) | 172 | — | 138 | ||||||||||||||||||||||
| Net unrealized gains on equity securities | 1,471 | — | — | 1,471 | ||||||||||||||||||||||
| Other revenue | — | 46 | — | 46 | ||||||||||||||||||||||
| Total revenues | 179,408 | 49,231 | 46 | 228,685 | ||||||||||||||||||||||
| EXPENSES: | ||||||||||||||||||||||||||
| Losses and loss adjustment expenses | 54,718 | 34,333 | — | 89,051 | ||||||||||||||||||||||
| Policy acquisition costs | 80,198 | 13,001 | — | 93,199 | ||||||||||||||||||||||
| Operating expenses | 4,873 | 11,005 | 380 | 16,258 | ||||||||||||||||||||||
| General and administrative expenses | 7,599 | 22,135 | 1,686 | 31,420 | ||||||||||||||||||||||
| Interest expense | — | 1 | 9,302 | 9,303 | ||||||||||||||||||||||
| Total expenses | 147,388 | 80,475 | 11,368 | 239,231 | ||||||||||||||||||||||
| Income (loss) before other income | 32,020 | (31,244) | (11,322) | (10,546) | ||||||||||||||||||||||
| Other income | 1 | 128 | — | 129 | ||||||||||||||||||||||
| Income (loss) before income taxes | $ | 32,021 | $ | (31,116) | (11,322) | (10,417) | ||||||||||||||||||||
| Benefit for income taxes | (6,699) | (6,699) | ||||||||||||||||||||||||
| Net income (loss) | $ | (4,623) | $ | (3,718) | ||||||||||||||||||||||
| Less: Net income attributable to noncontrolling interests | (1,949) | (1,949) | ||||||||||||||||||||||||
| Net income (loss) attributable to ACIC | $ | (2,674) | $ | (1,769) | ||||||||||||||||||||||
Loss ratio, net (2) (3) | 31.6 | % | 71.6 | % | 40.3 | % | ||||||||||||||||||||
Expense ratio (2) (4) | 53.5 | % | 96.3 | % | 63.7 | % | ||||||||||||||||||||
Combined ratio (2) (5) | 85.1 | % | 167.9 | % | 104.0 | % | ||||||||||||||||||||
(1) Our personal lines income statement also includes amounts related to subsidiaries outside of our insurance companies. We have included these items, as these subsidiaries directly support our personal lines operations.
(2) As these are calculated ratios, the addition of the ratios will not result in the same value as the consolidated ratio. To calculate the consolidated ratio please see the corresponding footnote below.
(3) Loss ratio, net is calculated as losses and LAE net of losses ceded to reinsurers, relative to net premiums earned. Management uses this operating metric to analyze our loss trends and believes it is useful for investors to evaluate this component separately from our other operating expenses.
(4) Expense ratio is calculated as the sum of all operating expenses less interest expense relative to net premiums earned. Management uses this operating metric to analyze our expense trends and believes it is useful for investors to evaluate these components separately from our loss expenses.
(5) Combined ratio is the sum of the loss ratio, net and expense ratio. Management uses this operating metric to analyze our total expense trends and believes it is a key indicator for investors when evaluating the overall profitability of our business.
Depreciation and amortization related to our commercial lines operating segment totaled $3,247,000, $3,246,000, and $3,397,000 for the years ended December 31, 2023, 2022 and 2021 respectively.
Depreciation and amortization related to our personal lines operating segment totaled $1,602,000, $14,446,000, and $5,070,000 for the years ended December 31, 2023, 2022 and 2021 respectively. December 31, 2022 includes $10,156,000 related to the impairment of goodwill.
The tables below present the segment assets as of December 31, 2023 and 2022.
| Assets by Segment as of December 31, 2023 | ||||||||||||||||||||||||||
| Commercial | Personal | Adjustments | Total | |||||||||||||||||||||||
| Assets by Segment before eliminations | $ | 944,212 | $ | 195,120 | $ | (87,044) | $ | 1,052,288 | ||||||||||||||||||
| Adjustment by Segment for eliminations | (48,053) | (110,021) | 158,074 | — | ||||||||||||||||||||||
| Assets by Segment after eliminations | $ | 896,159 | $ | 85,099 | $ | 71,030 | $ | 1,052,288 | ||||||||||||||||||
| Assets by Segment as of December 31, 2022 | ||||||||||||||||||||||||||
| Commercial | Personal | Adjustments | Total | |||||||||||||||||||||||
| Assets by Segment before eliminations | $ | 1,588,385 | $ | (149,816) | $ | (35,888) | $ | 1,402,681 | ||||||||||||||||||
| Adjustment by Segment for eliminations | (318,316) | 279,119 | 39,197 | — | ||||||||||||||||||||||
| Assets by Segment after eliminations | $ | 1,270,069 | $ | 129,303 | $ | 3,309 | $ | 1,402,681 | ||||||||||||||||||
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.