American Integrity Insurance Group, Inc.

Organization and Description of the Company

American Integrity Insurance Group, Inc., a Delaware corporation (the “Company”), was formed on January 15, 2025, American Integrity Insurance Group, LLC, a Texas limited liability company (“AIIG”), was formed in 2006. On May 9, 2025, the holders of all of the outstanding equity of AIIG contributed all of their equity interests in AIIG to the Company (the “Corporate Contribution”), in exchange for 12,904,495 shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), immediately prior to the Company’s initial public offering (the “IPO”). This is further described in the “Initial Public Offering and Corporate Contribution” section below. The operations of AIIG represent the predecessor to the Company prior to the IPO, and the consolidated and combined entities of the Company are described in more detail below. Information for any periods prior to May 7, 2025 relates to AIIG and its subsidiaries.

The Company and its wholly-owned subsidiaries are engaged in the property and casualty insurance business. The Company’s subsidiaries include American Integrity Insurance Company of Florida (“AIICFL”), a property and casualty insurance company domiciled in the state of Florida; American Integrity MGA, LLC (“AIMGA”), a Texas limited liability company operating as a managing general agency and functioning as a manager for the insurance subsidiary’s business; American Integrity Claims Services, LLC (“AICS”), a Texas limited liability company operating as a third-party administrator and providing insurance claims processing services; Pinnacle Insurance Consultants, LLC (“PIC”), a Nevada limited liability company operating as a licensed insurance agency in the state of Florida; and Pinnacle Analytics, LLC (“PA”), a Texas limited liability company performing limited reinsurance brokerage functions for the insurance subsidiary’s business. During 2023, the Company entered into an agreement with Artex SAC Limited (“Artex”), a Bermuda Licensed Segregated Accounts Company, to establish Catstyle Segregated Account (“Catstyle”). Catstyle is a segregated account controlled by the Company formed for the purpose of conducting reinsurance business.

The Company’s property and casualty insurance is currently offered in Florida, South Carolina, and Georgia.

Basis of Presentation and Principles of Consolidation

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”) for interim financial information, and the Securities and Exchange Commission (“SEC”) rules for interim financial reporting. Accordingly, these condensed consolidated financial statements do not include all the information and footnotes required for complete financial statements and should be read in conjunction with the audited condensed consolidated financial statements of AIIG and the accompanying notes thereto for the year ended December 31, 2024. 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. The results for interim periods do not necessarily indicate the results that may be expected for any interim period or for the full year.

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.

Certain information and disclosures normally included in annual condensed consolidated financial statements presented in accordance with GAAP have been omitted pursuant to rules and regulations of the SEC. Accordingly, investors should read these unaudited condensed consolidated financial statements and related notes in conjunction with AIIG’s audited condensed consolidated financial statements and related notes included in our prospectus, dated May 7, 2025 filed with the Securities and Exchange Commission pursuant to Rule 424(b) under the Securities Act of 1933, as amended, on May 8, 2025 in connection with the Company’s IPO.

The condensed consolidated financial statements for prior periods give effect to the Corporate Contribution discussed below, including the exchange of all 122,900 units of AIIG for an aggregate of 12,904,495 shares of Common Stock of the Company, which is equivalent to an overall exchange ratio of

one-for-105.

All share and earnings per share amounts presented herein have been retroactively adjusted to give effect to the Corporate Contribution as if they occurred prior to all prior periods presented.

Initial Public Offering and Corporate Contribution

Immediately prior to the IPO, the owners of the equity interests of AIIG contributed all of their equity interests to the Company in exchange for an aggregate of 12,904,495 shares of Common Stock in the Corporate Contribution. On May 9, 2025, the Company completed its IPO of an aggregate of 6,875,000 shares of the Company’s Common Stock, at a price to the public of $16.00 per share,6,250,000 of which shares were sold by the Company and 625,000 of which shares were sold by certain selling shareholders. The gross proceeds to the Company from the IPO were $100 million, and gross proceeds to the selling shareholders from the IPO were $10 million, before deducting underwriting discounts and commissions of $7 million. Pending their further use, the proceeds were invested in investment grade instruments. On May 13, 2025, the underwriters completed the exercise of their option to purchase an additional 1,031,250 additional shares of Common Stock from the selling shareholders resulting in an additional $16.5 million in gross proceeds to the selling shareholders, before deducting underwriting discounts and commissions. The Company did not receive any gross proceeds from the sales of shares of Common Stock by the selling shareholders.

In connection with the IPO, the Company issued a net amount of 417,470 shares of restricted stock to certain employees and consultants (the “Restricted Stock Grant”) after giving effect to the withholding of approximately 234,587 shares of Common Stock to satisfy the estimated tax withholding and remittance obligations (the “Restricted Stock Grant Net Settlement”). The Company incurred a

share-based compensation expense of $10.4 million in connection with the Restricted Stock Grant, which was expensed in general and administrative expenses on the Condensed Consolidated Statements of Operations and Comprehensive Income. The Company also paid $3.8 million for tax withheld on vesting of restricted stock in connection with the Restricted Stock Grant Net Settlement. The compensation expense for these awards was recognized in the second quarter of 2025.

The Company’s Common Stock is listed on the New York Stock Exchange under the symbol “AII”.

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, and valuation of investments.

Changes to Significant Accounting Policies

There have been no changes to significant accounting policies as reported in the audited condensed consolidated financial statements of AIIG for the year ended December 31, 2024. The Company has included the Earnings per Share policy, which is a newly updated policy to reflect the Corporate Contribution for the unaudited condensed consolidated financial statements of the Company for the three months ended June 30, 2025. The Company has also included the fair value of financial instruments policy, which establishes the fair value hierarchy.

Deferred Transaction Costs

Deferred transaction costs consist of direct incremental legal, accounting, and consulting fees relating to the Company’s IPO. The deferred transaction costs were offset against the IPO proceeds upon the completion of the offering in accordance with ASC

340-10-S99-1.

A total of $4,227 of transaction costs were offset against the IPO proceeds and reported as a reduction to additional paid in capital (APIC) during the six months ended June 30, 2025. As of June 30, 2025 and December 31, 2024, there wereno deferred transaction costs capitalized in other assets in the condensed consolidated balance sheets.

Restricted Stock

The restricted stock awards are subject to a service condition and are accounted for as equity under ASC 718. The restricted stock awards are valued based on the fair value of the underlying award, which is the Company’s Common Stock, at the date of grant. The Company recognizes the compensation cost for the restricted stock awards on a straight-line basis over the awards’ vesting period as general and administrative expenses within the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income. All shares issued to date have vested immediately. The Company recognizes any award forfeitures when they occur.

In connection with the restricted stock awards, the Company satisfies employee tax withholding obligations related to the vesting of restricted stock by withholding a portion of the shares otherwise issuable to employees. The shares withheld are immediately retired and are not held as treasury stock. As a result, both the number of shares issued and outstanding are reduced by the number of shares withheld and retired. The cash paid to tax authorities for these withheld shares is classified as a financing activity in the condensed consolidated statement of cash flows.

Earnings per Share

Basic net income per share is computed by dividing net income available to common shareholders by the weighted-average common shares outstanding during the period. Diluted earnings per share is computed by dividing the Company’s net income available to shareholders, by the weighted average number of shares outstanding during the period plus the impact of all potentially dilutive shares, such as preferred shares, unvested shares and options. The dilutive impact of share options and unvested shares is determined by applying the treasury stock method and the dilutive impact of any preferred shares is determined by applying the “if converted” method. The Company did not have any dilutive instruments for the period, and therefore, diluted earnings per share is equal to basic earnings per share. There are no unvested shares issued or outstanding.

Fair Value of Financial Instruments

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date (an exit price). ASC 820, “Fair Value Measurements and Disclosures” (“ASC 820”) establishes a fair value hierarchy that prioritizes and ranks the level of observability of inputs used to measure investments at fair value. The observability of inputs is impacted by a number of factors, including the type of investment, characteristics specific to the investment, market conditions and other factors. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

The three levels of the hierarchy are as follows:

When fair value inputs fall within different levels of the fair value hierarchy, the level in the fair value hierarchy within which the asset or liability is categorized in its entirety is determined based on the lowest level input that is significant to the asset or liability. Assessing the significance of a particular input to the valuation of an asset or liability in its entirety requires judgment and considers factors specific to the asset or liability. The categorization of an asset or liability within the hierarchy is based upon the pricing transparency of the asset or liability and does not necessarily correspond to the perceived risk of that asset or liability.

Cash and cash equivalents, and restricted cash approximate fair value and are therefore excluded from the leveling table seen in Note 5 – “

Fair Value Measurements

.” The cost basis is determined to approximate fair value due to the short-term duration of the financial instruments.

Recently Issued Accounting Pronouncements Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“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 will be applied prospectively with the option to apply it retrospectively for each period presented. For public business entities, the new requirements will be effective for annual periods beginning after December 15, 2024. Management is currently evaluating the impact and does not expect that this update will have a material impact on its consolidated financial condition or results of operations, but the ASU will require additional disclosures in the annual condensed consolidated financial statements.

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 condensed consolidated financial statements and related disclosures.

As part of the 2023-2024 catastrophe excess of loss reinsurance placement, which incepted on June 1, 2023, AIICFL entered into a reinsurance agreement with Catstyle, a segregated account controlled by the Company. Catstyle provides reinsurance coverage for layer one of the Company’s catastrophe reinsurance program effective June 1, 2023 through May 31, 2024, June 1, 2024 through May 31, 2025, and June 1, 2025 through May 31, 2026. Catstyle reinsurance eliminates in consolidation.

To establish the Catstyle, AIIG entered into a master preference shareholder agreement with Artex whereby AIIG purchased 1,000

non-voting

redeemable preference shares, par value of $1.00, to become the sole shareholder of Catstyle. AIIG also contributed additional surplus in order to fully capitalize Catstyle.

The Company was determined to be the primary beneficiary of Catstyle, a silo that is a VIE within Artex, as AIIG has the power to direct the activities that significantly affect the economic performance as well as the obligation to absorb losses and the right to receive benefits that could potentially be significant of Catstyle. Thus, AIIG has consolidated the assets, liabilities and operations of Catstyle in its condensed consolidated financial statements with intercompany balances and transactions eliminated in consolidation.

The following table presents, on a consolidated basis, the balance sheet classification and exposure of restricted cash and investments held in the segregated account, which are used to settle reinsurance obligations of the VIE as of the dates presented. Restricted cash and investments held in the segregated account are required to be held in a trust account solely for the benefit of the Company and can be used to settle activity under the reinsurance agreement. Any restricted cash or investments held in the segregated account not actively being used to settle activity under the reinsurance agreement can be paid to the Company by dividend based upon underwriting results of the segregated account or by expiration or termination of the reinsurance agreement. Catstyle cannot declare or pay dividends without necessary approvals from the Bermuda Monetary Authority (the “Authority”).

Available-for-Sale

Securities

The amortized cost and estimated fair value of

securities are as follows:

A summary of the aggregate estimated fair values of

securities with unrealized losses segregated by time period in an unrealized loss position is as follows:

A summary of the amortized cost and estimated fair value of

securities at June 30, 2025, by contractual maturity is as follows. The expected maturities may differ from the contractual maturities because certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

The following table presents components of the Company’s net investment income for the three month period ended:

Proceeds from sales or maturities of fixed maturity

securities for the three months ended June 30, 2025 were $43,616 with $514 and $29 of gross realized gains and losses, respectively. For the three months ended June 30, 2024, proceeds from sales of fixed maturity

securities totaled $48,608, with $81 and $3 of gross realized gains and losses, respectively. Proceeds from sales or maturities of fixed maturity

securities for the six months ended June 30, 2025 were $103,486 with $625 and $124 of gross realized gains and losses, respectively. For the six months ended June 30, 2024, proceeds from sales of fixed maturity

securities totaled $52,140, with $89 and $5 of gross realized gains and losses, respectively.

The Company did not record any activity pertaining to the allowance for credit losses as of June 30, 2025 or December 31, 2024.

The tables below presents information about the Company’s financial assets measured at fair value on a recurring basis:

The Company had no assets carried at fair value in the Level 3 category as of June 30, 2025 and December 31, 2024.

The Company classifies U.S. Treasury bonds and government agencies, short-term investments, and some corporate debt securities within Level 1 of the fair value hierarchy because they are valued based on quoted market prices in active markets. Corporate debt securities and asset-backed securities categorized as Level 2 were valued using a market approach. Valuations were based upon quoted prices for similar assets in active markets, quoted prices for identical or similar assets in inactive markets, or valuations based on models where the significant inputs are observable (e.g., interest rates, yield curves, prepayment speeds, default rates, loss severities) or can be corroborated by observable market data.

During the three months ended June 30, 2025, the Company had no event or circumstance change that would cause an instrument to be transferred between levels.

The following table summarizes the carrying value and estimated fair value of the Company’s financial instruments not carried at fair value as of the date presented:

The Company’s long-term debt represents a surplus note and fair value was determined by management from the expected cash flows discounted using the interest rate quoted by the holder. The Florida State Board of Administration (“FSBA”) is the holder of the surplus note, and the quoted interest rate is equivalent to the

10-year

Constant Maturity Treasury Rate, adjusted quarterly. The Company’s use of funds from the surplus note is limited by the terms of the agreement, therefore, the Company has determined the interest rate quoted by the FSBA to be appropriate for purposes of establishing the fair value of the surplus note (Level 3).

The tables below show the activity regarding deferred policy acquisition costs (“DPAC”) for the three and six months ended June 30, 2025 and 2024.

The liability for unpaid losses and loss adjustment expenses (“LAE”) includes an amount determined from loss reports and individual cases and an amount, based on past experience, for losses incurred but not yet reported.

The following table provides a reconciliation of changes in the liability for unpaid losses and LAE:

During the six months ended June 30, 2025, the liability for unpaid losses and loss adjustment expenses, prior to reinsurance, increased by $3,685 from $60,622 as of December 31, 2024 to $64,307 as of June 30, 2025. The increase was principally the result of an increase in reserves for Citizens assumed business of $6,424, partially offset by a decrease in reserves related to

non-catastrophe

storms.

Prior period development includes changes in estimated losses and LAE for all events occurring in prior periods including hurricanes and other weather. In 2025, the

Company’s

net loss and LAE incurred for the six months ended June 30, 2025 reflected a favorable development of $1,117, which was a result of

re-estimation

of unpaid losses and LAE. These adjustments are generally the result of ongoing analysis of recent loss development trends. Original estimates are decreased or increased as additional information becomes known regarding individual claims.

In order to limit the Company’s potential exposure to individual risks and catastrophic events, the Company purchases reinsurance from third-party reinsurers as well as the Florida Hurricane Catastrophe Fund (the “FHCF”), a state-mandated catastrophe fund for Florida policies only. Most of the Company’s reinsurance partners were rated

“A-”

or higher by A.M. Best Company, Inc. (“A.M. Best”) or “BBB” or higher by Standard & Poor’s Financial Services LLC (“S&P”) or were fully collateralized.

In 2024, the Company also began participating in a

“take-out

program” through which the Company assumes insurance policies held by Citizens Property Insurance Corporation (“Citizens”), a Florida state-supported insurer. The

take-out

program is a legislatively mandated program designed to reduce the state’s risk exposure by encouraging private companies to assume policies from Citizens.

The Company remains contingently liable in the event the reinsuring companies do not meet their obligations under these reinsurance contracts. Given the quality of the reinsuring companies, management believes this possibility to be remote.

2025 – 2026 Reinsurance Program

Catastrophe Excess of Loss Reinsurance

Effective June 1, 2025, the Company entered into catastrophe excess of loss reinsurance agreements covering its insurance subsidiary, AIICFL. The catastrophe reinsurance program is indemnity-based and includes a combination of coverage from traditional reinsurers, the FHCF, Insurance Linked Securities (“ILS”) investors through Integrity Re III Ltd., and the Company’s segregated cell captive reinsurer.

The 2025–2026 reinsurance program provides third-party reinsurance coverage of $1.93 billion for a single catastrophic event, with total third-party coverage of $2.59 billion across all occurrences, representing a 45% increase over the prior year’s treaty limit. The Company’s net retention for the first and second events is $35.0 million, consisting of $10.0 million retained by AIICFL and $25.0 million retained by the Company’s segregated cell captive reinsurer. The retention for third and fourth catastrophic events decreases to $15.8 million and $10.0 million, respectively, and is retained solely by AIICFL.

The FHCF covers Florida-admitted risks only, and the Company elected to participate at 90% for the 2025 hurricane season, consistent with the prior year.

Integrity Re III Ltd., a Bermuda-based special purpose insurer and unrelated party issued new catastrophe bonds totaling $565.0 million as part of the program, marking the eighth and largest ILS transaction sponsored by the Company.

All reinsurers participating in the program are either rated

“A-”

or higher by A.M. Best or are fully collateralized, to mitigate counterparty credit risk. The entire program is structured without parametric covers and is fully indemnity-based.

Total net consolidated catastrophe reinsurance premiums ceded to third parties are expected to be approximately $433.3 million for the 2025–2026 treaty year, a 28% increase compared to the prior year.

Effect of Reinsurance

The effects of reinsurance on premiums written and earned are as follows:

The Company’s reinsurance arrangements affected certain items in the Condensed Consolidated Statement of Operations for the three months ended June 30, 2025 and 2024 by the following amounts:

For the three months ended June 30, 2025 and 2024, recoveries received under reinsurance contracts were $30,041 and $57,725, respectively.

For the six months ended June 30, 2025 and 2024, recoveries received under reinsurance contracts were $67,631 and $240,964, respectively.

State laws and regulations, as well as national regulatory agency requirements, govern the operations of all insurers. The various laws and regulations require that insurers maintain minimum amounts of statutory surplus and risk-based capital; restrict insurers’ ability to pay dividends; restrict the allowable investment types and investment mixes and subject the Company’s insurers to assessments.

The Company’s insurance subsidiary is subject to regulations and standards of the Florida Office of Insurance Regulation (“FLOIR”). It is also subject to regulations and standards of regulatory authorities in other states where they are licensed, although as a Florida-domiciled insurer, its principal regulatory authority is FLOIR.

The Company’s insurance subsidiary prepares its statutory-basis financial statements in accordance with statutory accounting practices prescribed or permitted by FLOIR. The commissioner of FLOIR has the right to permit other practices that may deviate from prescribed practices. The Company’s insurance subsidiary does not obtain and follow any permitted practice. As of June 30, 2025 and December 31, 2024, the Company’s insurance subsidiary reported statutory capital and surplus of $176,078 and $149,586, respectively. For the six months ended June 30, 2025 and June 30, 2024, the Company’s insurance subsidiary reported statutory net income of $31,766 and $2,062, respectively. Statutory-basis surplus differs from shareholders’ equity reported in accordance with GAAP primarily because policy acquisition costs are expensed when incurred, certain assets that are not admitted assets are eliminated from the Consolidated Balance Sheet and surplus notes are reported as surplus rather than liabilities. In addition, the recognition of deferred tax assets is based on different recoverability assumptions.

The Florida statutes require a residential property insurance company to maintain statutory surplus as to policyholders of at least $1,500 or 10% of the insurer’s total liabilities, whichever is greater. Accordingly, as of June 30, 2025 and December 31, 2024, the Company’s insurance subsidiary exceeded the minimum statutory surplus requirement, which was $17,608 and $14,959, respectively.

Under Florida law, without regulatory approval, the Company’s insurance subsidiary may pay dividends if they do not exceed the greater of:(1) the lesser of 10% of surplus or net income, not including realized capital gains, plus a

two-year

carry forward; (2) 10% of surplus, with dividends payable limited to unassigned funds minus 25% of unrealized capital gains; or (3) the lesser of 10% of surplus or net investment income plus a three-year carry forward with dividends payable limited to unassigned funds minus 25% of unrealized capital gains. The Company’s insurance subsidiary did not pay any dividends during 2025, and it can still pay dividends without regulatory approval.

The Company’s insurance subsidiary is also required annually to comply with the National Association of Insurance Commissioners (“NAIC”) risk-based capital (“RBC”) requirements. RBC requirements prescribe a method of measuring the amount of capital appropriate for an insurance company to support its overall business operations in light of its size and risk profile. NAIC RBC requirements are used by regulators to determine appropriate regulatory actions relating to insurers who show signs of a weak or deteriorating condition. As of June 30, 2025 and December 31, 2024, based on calculations using the appropriate NAIC RBC formula, the Company’s insurance subsidiary reported total adjusted capital in excess of the requirements.

The Company’s insurance subsidiary has maintained a cash deposit with the Insurance Commissioner of the State of Florida and other states in which the Company’s insurance subsidiary is authorized to write business in to meet regulatory requirements and are included in restricted cash on the condensed consolidated balance sheet.

In addition, Florida property and casualty insurance companies are required to adhere to prescribed

premium-to-capital

surplus ratios. Florida state law requires that the ratio of 90% of premiums written divided by surplus as to policyholders does not exceed 10 to 1 for gross premiums written or 4 to 1 for net premiums written. The Company’s insurance subsidiary had a ratio of gross and net premiums written to surplus of 2.6 to 1 and 0.8 to 1, respectively, which has met the requirements.

The Company also has the Catstyle reinsurance segregated account, where the Company can withdraw from cash held in the segregated account, but must provide written notice to the trustee in the form of a withdrawal notice in order to access the funds. However, consent of the grantor is not required to access the funds, and the funds’ use is not restricted within the terms of the trust agreement. Catstyle is regulated by the Authority and is required to meet and maintain certain minimum levels of solvency and liquidity. Catstyle’s statutory capital and surplus necessary to satisfy the regulatory requirements in the aggregate was $20,157 and $9,610 as of June 30, 2025 and December 31, 2024, respectively. As of June 30, 2025 and December 31, 2024, the actual amount of statutory capital and surplus was $20,157 and $9,610, respectively. The liabilities of Catstyle are fully collateralized and accordingly capital and surplus are available to be paid out in dividends and subject to approval in accordance with regulations of the Authority.

Immediately prior to the IPO, the owners of the equity interests of AIIG contributed all of their equity interests to the Company in exchange for an aggregate of 12,904,495 shares of Common Stock.

Public Offering

In connection with the IPO, the Company authorized of 100,000,000 shares of Common Stock, $0.001 par value per share, of which 19,571,965 shares are issued and outstanding, and 10,000,000 shares of preferred stock, $0.001 par value per share, of whichno shares are issued and outstanding.

The Company issued 6,250,000 shares of the Company’s Common Stock to the public, at a price of $16.00 per share. The Company received net proceeds of $93 million after deducting underwriting discounts and commissions and paid $4.2 million in offering expenses that reduced the proceeds received in Additional

Paid-in

Capital in the Condensed Consolidated Balance Sheet. In addition, in connection with the IPO, the Company used $3.8 million of the proceeds from the offering to satisfy the Restricted Stock Grant Net Settlement and $3.0 million of the proceeds of the offering to terminate the management services agreement by and between James Sowell Company, L.P. and AIIG, but these costs were expensed in general and administrative expenses on the Condensed Consolidated Statements of Operations and Comprehensive Income.

Distributions

The Company is a legal entity separate and distinct from its subsidiaries. As a holding company, the primary sources of cash needed to meet its obligations are distributions, dividends, and other permitted payments from its subsidiaries and consolidated VIEs. While there are no restrictions on distributions from AIMGA, AICS, PA, and PIC, dividends from AIICFL and Catstyle are restricted. See Note 9 – “

Regulatory Requirements and Restrictions

” for the restrictions on dividends from AIICFL and Note 3 – “

Variable Interest Entity

” for restrictions on dividends from Catstyle.

Prior to the IPO, taxable income was allocated to the members of AIIG in accordance with the United States Internal Revenue Code and AIIG’s LLC Operating Agreement. Distributions to members totaling $8.0 million and $8.0 million characterized as tax distributions, were declared and paid during the three months ended June 30, 2025 and 2024, respectively. Tax distributions totaled $12.9 million and $8.0 million during the six months ended June 30, 2025 and 2024, respectively.

Additionally, according to AIIG’s LLC Operating Agreement and prior to the IPO, AIIG’s Board of Directors may have, at its discretion, declared distributions to the members proportionally in accordance with their respective percentage ownership interests. The Company made $10.0 million and $4.0 million of discretionary distributions to members during the six months ended June 30, 2025 and 2024, respectively. There wereno discretionary distributions to members during the second quarter of 2025 and 2024.

Restricted Stock

On May 7, 2025, in connection with the IPO, the Company issued 652,057 shares of restricted stock to certain employees and consultants, which vested immediately upon issuance. In connection with the issuance,234,587 shares were withheld to satisfy the estimated tax withholding and remittance obligations. The shares withheld were immediately retired and not held as treasury stock, thus, as a result, both the number of shares issued and outstanding are reduced by the number of shares withheld and retired.

A summary of all restricted stock activity for the period May 7, 2025 to June 30, 2025 is as follows:

The Company incurred a

share-based compensation expense of $10,433 in connection with the Restricted Stock Grant and paid $3,753 in connection with the Restricted Stock Grant Net Settlement. As the shares vested immediately, compensation expense for these awards was entirely recognized in the second quarter of 2025 in general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income.

The Company concluded that it has onlyone reportable operating segment. This conclusion is based on the three characteristics of an operating segment within ASC 280. As there is a single reportable segment, the chief operating decision maker uses information that is presented in the Condensed Consolidated Financial Statements to evaluate the performance of the single segment, including net income as the measure of profit or loss. The measure of segment assets is reported on the balance sheet as total consolidated assets.

Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding during the period.

For the purposes of determining the basic and diluted weighted-average number of common shares outstanding during the periods presented that are prior to the IPO, the Company retrospectively reflected the Corporate Contribution in connection with the IPO. As such, the basic and diluted weighted-average number of common shares outstanding for those periods reflect the exchange of AIIG’s membership units into shares of Common Stock on the date of the IPO, assuming that all shares of Common Stock issued in conjunction with the IPO was issued and outstanding as of the beginning of the earliest period presented.

The Company historically had a Profit Participation Plan (“PPP”) that was terminated upon the IPO. For the comparative historical period presented, it was determined in accordance with ASC 260, Earnings Per Share, (“ASC 260”), that the participants of the PPP were able to participate in undistributed earnings with Common Stock based on a predetermined formula on a nonforfeitable basis, thus representing a participating security. The Company applies the

two-class

method to allocate income between the common shareholders and the PPP participants.

The following table presents the net income and the weighted average number of shares outstanding used in the earnings per share calculations. There wereno potentially dilutive instruments for the three and six months ended June 30, 2025 and 2024.

Comprehensive income (loss) includes changes in unrealized gains and losses on fixed maturities classified as

available-for-sale.

Reclassification adjustments for realized (gains) losses are reflected in net realized gains (losses) on investments on the Condensed Consolidated Statement of Operations.

The following tables are summaries of other comprehensive income (loss) and discloses the tax impact of each component of other comprehensive income (loss) for the three and six months ended June 30, 2025 and 2024:

Prior to the IPO, AIIG and its

non-insurance

subsidiaries, were included in a single partnership return for United States federal and state income tax purposes and were not subject to United States income tax, for the period January 1, 2025 through May 7, 2025, where the holders of all of the outstanding equity interests in AIIG contributed all of their equity interests in AIIG to the Company. As of May 7, 2025, the Company and its

non-insurance

subsidiaries are organized as a corporation and are subject to United States federal and state income tax. AIICFL remains organized as a corporation and is a taxable entity and will continue to file a stand-alone corporate income tax return for federal and state income tax purposes. The Company’s tax sharing agreement requires settlement of taxes between the subsidiaries in accordance to the terms of the agreement.

During the six months ended June 30, 2025 and 2024, the Company recorded approximately $1,416 and $6,910, respectively, of income tax expense, which resulted in effective tax rates of 2.1% and 20.5%, respectively. The Company has evaluated the circumstances for the six months ended June 30, 2025 and 2024, respectively, and determined that it is unable to make a reliable estimate of its ordinary income or related tax expense for the fiscal year. Therefore, the Company has calculated the income tax expense for the six months ended June 30, 2025 and 2024, respectively, based on the discrete effective tax rate. The Company’s estimated effective tax rate differs from the statutory federal tax rate due to state and income taxes as well as certain nondeductible and

tax-exempt

items.

The difference between the effective tax rate and the U.S. federal statutory tax rate of 21% for the six months ended June 30, 2025 was primarily due to state income taxes,

non-deductible

compensation related to employee stock awards granted and fully vested during the quarter, and a change in tax status related to the conversion of a

non-taxable

entity into a corporation. The effective tax rate also reflects the unfavorable impact of certain other nondeductible expenses.

The change in tax status created deferred tax assets of approximately $9.7 million, which were recognized as a

gain for the three months ended June 30, 2025 and resulted in an effective tax rate of (14.1)% for the period.

A valuation allowance must be established for deferred tax assets when it is more likely than not that the deferred tax assets will not be realized based on available evidence both positive and negative, including recent operating results, available tax planning strategies, and projected future taxable income. As of December 31, 2024, management concluded, based on the evaluation of the positive and negative evidence, that it is more likely than not that the deferred tax assets will be realized and therefore no valuation allowance on the Company’s deferred tax assets is required. The Company evaluates the realizability of its deferred tax assets each quarter, and as of June 30, 2025, based on all of the available evidence, management concluded that it is more likely than not that the deferred tax assets will be realized.

On July 4, 2025, the “One Big Beautiful Bill” (H.R. 1) was enacted into law. This legislation included broad changes to individuals, businesses, and international income tax provisions, but did not address the taxation of property and casualty insurance companies, under Subchapter L of the Internal Revenue Code. The Company evaluated the legislation, and determined that it does not materially impact its current or deferred income tax positions. As such, the enactment constitutes a Type II subsequent event under ASC 855, and no adjustment was made to the condensed consolidated financial statements as of June 30, 2025.

AIIG was a party to a management and financial advisory services agreement with a company owned by one of its members. The fees for financial advisory services were negotiated in good faith by both parties on a

case-by-case

basis. For financial oversight and monitoring services, AIIG paid a fixed monthly fee under the terms of the agreement. During the six months ended June 30, 2025 and 2024, the Company incurred fees under the agreement of $411 and $469, respectively, which is recorded within general and administrative expenses. During the second quarter, the management and financial advisory services agreement was terminated in conjunction with the IPO for a payment of $3,000. This has been included in general and administrative expenses on the Condensed Consolidated Statements of Operations and Comprehensive Income. There wereno amounts payable at June 30, 2025 or December 31, 2024, related to the agreement.

Obligations under Multi-Year Reinsurance Contracts

The Company purchases reinsurance coverage to protect its capital and to limit its losses when certain major events occur. The Company’s reinsurance commitments generally run from June 1 of the current year to May 31 of the following year. From time to time, certain of the Company’s reinsurance agreements may be for periods longer than one year. Amounts payable for coverage during the current June 1 to May 31 contract period are recorded as reinsurance payable in the Condensed Consolidated Balance Sheets. Multi-year contract commitments for future years are recorded at the beginning of the coverage period. As of June 30, 2025 and December 31, 2024, there were no multi-year reinsurance contract obligations.

Litigation

Lawsuits and other legal proceedings are filed against the Company from time to time. Many of these legal proceedings involve claims under insurance policies that the Company underwrites. The Company is also involved in various other legal proceedings and litigation unrelated to claims under the Company’s contracts, which arise in the ordinary course of business. The Company accrues amounts resulting from claim-related legal proceedings in unpaid losses and loss adjustment expenses during the period it determines an unfavorable outcome becomes probable and amounts can be estimated. Management believes that the resolution of these legal actions will not have a material impact on the Company’s condensed consolidated financial statements. The Company contests liability and/or the amount of damages as appropriate in each pending matter.

Leases

On February 20, 2025, the Company entered into a

152-month

lease agreement for approximately 75,000 square feet of new office space, where the Company will gain access to office suites in phases beginning in the first half of 2026. The asset has not been made available for use by the Company, and once made available for use, the Company will record the corresponding

right-of-use

asset and lease liability. The Company will begin paying rent on the leased space in December 2026 and future minimum lease commitments amount to $45,724 over the lease term.

Florida Insurance Guaranty Association

In April 2023, the Florida Insurance Guaranty Association (“FIGA”) issued an order for the collection of a 1.0% FIGA assessment policy surcharge for policies effective October 1, 2023 through September 30, 2024. The order directed member insurance companies to collect policy surcharge amounts in advance and to remit those surcharge amounts to FIGA on a quarterly basis. The Company recorded an accrued liability totaling $2,624 and $1,195, respectively, in other liability and accrued expenses as of June 30, 2025 and December 31, 2024, which represents the policy surcharge amounts collected, but unremitted to FIGA as of that date.

Operating lease cost was $544 and $539 for the three months ended June 30, 2025 and 2024, respectively, and $1,087 and $1,081 for the six months ended June 30, 2025 and 2024, respectively, and is included in other operating expenses on the Condensed Consolidated Statement of Operations. Short-term and variable lease cost was immaterial for the six months ended June 30, 2025 and 2024.

The following table provides supplemental balance sheet information about the Company’s leases as of June 30, 2025 and December 31, 2024:

Supplemental disclosure of cash flow information related to leases was as follows for the three and six months ended June 30, 2025 and 2024:

The estimated future minimum payments of operating leases as of June 30, 2025 are as follows:

The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed consolidated financial statements were issued. Based upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements.