AMERISAFE INC

Previous wording

The following table summarizes our consolidated financial results for the three and six months ended June 30, 2026 and 2025.

Current wording

The following table summarizes our consolidated financial results for the three and nine months ended September 30, 2026 and 2025.

Previous wording

Gross Premiums Written. Gross premiums written for the six months ended June 30, 2026 were $174.5 million, compared to $163.5 million for the same period in 2025, an increase of 6.7%. The increase was attributable to a $10.7 million increase in voluntary premiums on policies written during the period and a $1.2 million increase in premiums resulting from payroll audits and related premium adjustments for policies written in previous quarters. These increases were partially offset by a $0.9 million decrease in residual market premium.

Current wording

Gross Premiums Written. Gross premiums written for the quarter ended September 30, 2026 were $76.7 million, compared to $80.3 million for the same period in 2025, a decrease of 4.5%. The decrease was attributable to a $4.1 million decrease in premiums resulting from payroll audits and related premium adjustments for policies written in previous quarters, partially offset by a $0.6 million increase in voluntary premiums on policies written during the period.

Previous wording

Net Premiums Written. Net premiums written for the quarter ended June 30, 2026 were $81.8 million, compared to $75.5 million for the same period in 2025, an increase of 8.3%. The increase was primarily attributable to the increase in gross premiums written. As a percentage of gross premiums earned, ceded premiums were 5.2% for the second quarter of 2026 compared to 5.7% for the second quarter of 2025. The decrease in ceded premiums as a percentage of gross premiums earned is a result of a change in our 2026 reinsurance treaties. For additional information, see Item 1, “Business—Reinsurance” in our Annual Report on Form 10-K for the year ended December 31, 2025.

Current wording

Net Premiums Written. Net premiums written for the quarter ended September 30, 2026 were $72.7 million, compared to $76.0 million for the same period in 2025, a decrease of 4.3%. The decrease was primarily attributable to the decrease in gross premiums written. As a percentage of gross premiums earned, ceded premiums were 5.1% for the third quarter of 2026 compared to 5.7% for the third quarter of 2025. The decrease in ceded premiums as a percentage of gross premiums earned is a result of a change in our 2026 reinsurance treaties. For additional information, see Item 1, “Business—Reinsurance” in our Annual Report on Form 10-K for the year ended December 31, 2025.

Previous wording

Net Premiums Earned. Net premiums earned for the second quarter of 2026 were $77.3 million, compared to $69.4 million for the same period in 2025, an increase of 11.4%. The increase was primarily attributable to the increase in net premiums written.

Current wording

Net Premiums Earned. Net premiums earned for the third quarter of 2026 were $73.3 million, compared to $71.2 million for the same period in 2025, an increase of 3.0%. The increase was primarily attributable to the increase in premiums earned on policies written in previous quarters.

Previous wording

Net Investment Income. Net investment income for the first six months of 2026 was $13.1 million, compared to $13.3 million for the same period in 2025, a decrease of 1.6%. The decrease was due to lower average invested asset balances in the period compared to the same period in the prior year. The decrease in average invested assets was primarily attributable to capital returned to shareholders through dividend payments and share repurchases, which reduced cash and invested asset balances during the period. Average invested assets, including cash and cash equivalents, were $782.8 million in the six months ended June 30, 2026, compared to average invested assets of $824.1 million in the same period in 2025, a decrease of 5.0%. The pre-tax investment yield on our investment portfolio was 3.3% per annum for each of the six months ended June 30, 2026, and 2025. The tax-equivalent yield on our investment portfolio was 3.9% per annum for the first six months of 2026 and 2025. The tax-equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate.

Current wording

Net Investment Income. Net investment income for the quarter ended September 30, 2026 and 2025 was $6.6 million. Average invested assets, including cash and cash equivalents, were $766.1 million in the quarter ended September 30, 2026 compared to average invested assets of $811.2 million for the same period in 2025, a decrease of 5.6%. The pre-tax investment yield on our investment portfolio was 3.5% per annum during the quarter ended September 30, 2026 compared to 3.2% per annum for the same period in 2025. The tax-equivalent yield on our investment portfolio was 4.0% per annum for the quarter ended September 30, 2026 compared to 3.9% per annum for the same period in 2025. The tax-equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate.

Previous wording

Net Realized Gains (Losses) on Investments. Net realized losses on investments in the quarter ended June 30, 2026 were $0.1 million compared to net realized gains of $3.1 million for the same period in 2025. The net realized losses in the second quarter of 2026 were mostly attributable to the redemption of fixed maturity securities. The net realized gains in the second quarter of 2025 were mostly attributable to the sales of equity and fixed maturity securities classified as available-for-sale.

Current wording

Net Realized Gains (Losses) on Investments. Net realized losses on investments in the quarter ended September 30, 2026 were $0.1 million compared to immaterial net realized gains for the same period in 2025. The net realized losses in the third quarter of 2026 were mostly attributable to the redemption of fixed maturity securities.

Previous wording

Net Unrealized Gains (Losses) on Equity Securities. The market value of our equity securities increased by $8.1 million for the three months ended June 30, 2026 compared to an increase of $1.8 million for the same period in 2025. The increase in the market value of our equity securities was primarily due to stronger U.S. equity markets compared to the prior-year period.

Current wording

Net Unrealized Gains (Losses) on Equity Securities. The market value of our equity securities decreased by $0.2 million for the three months ended September 30, 2026 compared to an increase of $4.1 million for the same period in 2025.

Previous wording

Loss and Loss Adjustment Expenses Incurred. Loss and loss adjustment expenses (LAE) incurred totaled $48.3 million for the three months ended June 30, 2026, compared to $40.7 million for the same period in 2025, an increase of $7.7 million, or 18.9%. The current accident year loss and LAE incurred totaled $55.6 million for the three months ended June 30, 2026, compared to $49.3 million for the same period in 2025. As of June 30, 2026, our estimate for loss and LAE for accident year 2026 continues to be 72.0% of net premiums earned, reflective of pressure from continued rate decreases and long-term claim frequency and severity trends, as well as medical inflation. Our initial estimate for loss and LAE for accident year 2025 of 71.0% of net premiums earned was increased to 72.0% in the fourth quarter of 2025 largely due to the frequency of severity observed in that accident year. We recorded favorable prior accident year development of $7.3 million in the second quarter of 2026, compared to favorable prior accident year development of $8.6 million in the same period of 2025, as further discussed below in “Prior Year Development.” Our net loss ratio was 62.6% in the second quarter of 2026, compared to 58.6% for the same period of 2025.

Current wording

Loss and Loss Adjustment Expenses Incurred. Loss and loss adjustment expenses (LAE) incurred totaled $45.9 million for the three months ended September 30, 2026, compared to $41.7 million for the same period in 2025, an increase of $4.2 million, or 10.2%. The current accident year loss and LAE incurred totaled $52.8 million for the three months ended September 30, 2026, compared to $50.6 million for the same period in 2025. As of September 30, 2026, our estimate for loss and LAE for accident year 2026 continues to be 72.0% of net premiums earned, reflective of pressure from continued rate decreases and long-term claim frequency and severity trends, as well as medical inflation. Our initial estimate for loss and LAE for accident year 2025 of 71.0% of net premiums earned was increased to 72.0% in the fourth quarter of 2025 largely due to the frequency of severity observed in that accident year. For the third quarter of 2026, we are maintaining our 72.0% loss and LAE ratio estimate for accident year 2025. We recorded favorable prior accident year development of $6.9 million in the third quarter of 2026, compared to favorable prior accident year development of $8.9 million in the same period of 2025, as further discussed below in “Prior Year Development.” Our net loss ratio was 62.6% in the third quarter of 2026, compared to 58.5% for the same period of 2025.

Previous wording

Underwriting and Certain Other Operating Costs, Commissions and Salaries and Benefits. Underwriting and certain other operating costs, commissions and salaries and benefits for the quarter ended June 30, 2026 were $24.6 million, compared to $21.7 million for the same period in 2025, an increase of 13.1%. This increase was primarily due to a $1.1 million increase in compensation expense related to an incentive bonus true-up recorded in prior year, a $0.8 million increase in accounts receivable write-offs and a $0.7 million increase in commission expense. Partially offsetting these amounts was a $0.3 million decrease in mandatory pooling arrangement fees. Our expense ratio was 31.8% in the second quarter of 2026 compared to 31.3% in the second quarter of 2025.

Current wording

Underwriting and Certain Other Operating Costs, Commissions and Salaries and Benefits. Underwriting and certain other operating costs, commissions and salaries and benefits for the quarter ended September 30, 2026 were $23.8 million, compared to $22.1 million for the same period in 2025, an increase of 7.9%. This increase was primarily due to a $0.7 million increase in compensation expense, a $0.5 million increase in insurance related assessments and a $0.3 million increase in commission expense. Our expense ratio was 32.5% in the third quarter of 2026 compared to 31.1% in the third quarter of 2025.

Previous wording

Income Tax Expense. Income tax expense for the three months ended June 30, 2026 was $3.7 million, compared to $3.5 million for the same period in 2025. The effective tax rate for the quarters ended June 30, 2026 and 2025 was 20.1%.

Current wording

Income Tax Expense. Income tax expense for the three months ended September 30, 2026 was $1.8 million, compared to $3.7 million for the same period in 2025. The effective tax rate for the Company for the quarter ended September 30, 2026 was 20.0% compared to 21.0% in the third quarter of 2025. The decrease in the effective tax rate was due to a higher proportion of income from tax-exempt investments.

Previous wording

Consolidated Results of Operations for Six Months Ended June 30, 2026 Compared to June 30, 2025

Current wording

Consolidated Results of Operations for Nine Months Ended September 30, 2026 Compared to September 30, 2025

Previous wording

Gross Premiums Written. Gross premiums written for the quarter ended June 30, 2026 were $86.0 million, compared to $79.7 million for the same period in 2025, an increase of 7.9%. The increase was attributable to a $4.3 million increase in voluntary premiums on policies written during the period and a $2.6 million increase in premiums resulting from payroll audits and related premium adjustments for policies written in previous quarters, partially offset by a $0.7 million decrease in residual market premium.

Current wording

Gross Premiums Written. Gross premiums written for the nine months ended September 30, 2026 were $251.1 million, compared to $243.8 million for the same period in 2025, an increase of 3.0%. The increase was attributable to an $11.3 million increase in voluntary premiums on policies written during the period, partially offset by a $2.8 million decrease in premiums resulting from payroll audits and related premium adjustments for policies written in previous quarters and a $1.1 million decrease in residual market premium.

Previous wording

Net Premiums Written. Net premiums written for the six months ended June 30, 2026 were $166.2 million, compared to $155.1 million for the same period in 2025, an increase of 7.1%. The increase was primarily attributable to an increase in gross premiums written. As a percentage of gross premiums earned, ceded premiums were 5.2% for the first six months of 2026, compared to 5.7% in the same period of 2025. The decrease in ceded premiums as a percentage of gross premiums earned is a result of a change in our 2026 reinsurance treaties. For additional information, see Item 1, “Business—Reinsurance” in our Annual Report on Form 10-K for the year ended December 31, 2025.

Current wording

Net Premiums Written. Net premiums written for the nine months ended September 30, 2026 were $238.9 million, compared to $231.1 million for the same period in 2025, an increase of 3.4%. The increase was primarily attributable to an increase in gross premiums written. As a percentage of gross premiums earned, ceded premiums were 5.1% for the first nine months of 2026, compared to 5.7% in the same period of 2025. The decrease in ceded premiums as a percentage of gross premiums earned is a result of a change in our 2026 reinsurance treaties. For additional information, see Item 1, “Business—Reinsurance” in our Annual Report on Form 10-K for the year ended December 31, 2025.

Previous wording

Net Premiums Earned. Net premiums earned for the six months ended June 30, 2026 were $152.3 million, compared to $138.3 million for the same period in 2025, an increase of 10.2%. The increase was primarily attributable to the increase in net premiums written.

Current wording

Net Premiums Earned. Net premiums earned for the nine months ended September 30, 2026 were $225.7 million, compared to $209.5 million for the same period in 2025, an increase of 7.7%. The increase was primarily attributable to the increase in net premiums written.

Previous wording

Net Investment Income. Net investment income for the quarter ended June 30, 2026 was $6.5 million, compared to $6.7 million for the same period in 2025, a decrease of 2.4%. The decrease was due to lower average invested asset balances in the period compared to the same period in the prior year. The decrease in average invested assets was primarily attributable to capital returned to shareholders through dividend payments and share repurchases, which reduced cash and invested asset balances during the period. Average invested assets, including cash and cash equivalents, were $772.6 million in the quarter ended June 30, 2026 compared to average invested assets of $813.1 million for the same period in 2025, a decrease of 5.0%. The pre-tax investment yield on our investment portfolio was 3.4% per annum during the quarter ended June 30, 2026 compared to 3.3% per annum for the same period in 2025. The tax-equivalent yield on our investment portfolio was 3.9% per annum for the quarters ended June 30, 2026 and 2025. The tax-equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate.

Current wording

Net Investment Income. Net investment income for the first nine months of 2026 was $19.7 million, compared to $19.9 million for the same period in 2025, a decrease of 0.9%. The decrease was due to lower average invested asset balances in the period compared to the same period in the prior year. The decrease in average invested assets was primarily attributable to capital returned to shareholders through dividend payments and share repurchases, which reduced cash and invested asset balances during the period. Average invested assets, including cash and cash equivalents, were $777.3 million in the nine months ended September 30, 2026, compared to average invested assets of $820.6 million in the same period in 2025, a decrease of 5.3%. The pre-tax investment yield on our investment portfolio was 3.4% per annum during the nine months ended September 30, 2026, compared to 3.2% per annum during the same period in 2025. The tax-equivalent yield on our investment portfolio was 4.0% per annum for the first nine months of 2026 compared to 3.9% per annum for the same period in 2025. The tax-equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate.

Previous wording

Net Realized Gains (Losses) on Investments. Net realized losses on investments for the six months ended June 30, 2026 were $0.1 million compared to net realized gains of $3.1 million for the same period in 2025. The net realized losses in the first six months of 2026 were mostly attributable to the redemption of fixed maturity securities. The net realized gains in the first six months of 2025 were mostly attributable to the sales of equity and fixed maturity securities classified as available-for-sale.

Current wording

Net Realized Gains (Losses) on Investments. Net realized losses on investments for the nine months ended September 30, 2026 were $0.1 million compared to net realized gains of $3.1 million for the same period in 2025. The net realized losses in the first nine months of 2026 were mostly attributable to the redemption of fixed maturity securities. The net realized gains in the first nine months of 2025 were mostly attributable to the sales of equity and fixed maturity securities classified as available-for-sale.

Previous wording

Net Unrealized Gains (Losses) on Equity Securities. The market value of our equity securities increased by $6.5 million for the six months ended June 30, 2026 compared to a decrease of $1.3 million for the same period in 2025. The increase in the market value of our equity securities was primarily due to stronger U.S. equity markets compared to the prior-year period.

Current wording

Net Unrealized Gains (Losses) on Equity Securities. The market value of our equity securities increased by $6.3 million for the nine months ended September 30, 2026 compared to an increase of $2.8 million for the same period in 2025.

Previous wording

Loss and Loss Adjustment Expenses Incurred. Loss and LAE incurred totaled $94.8 million for the six months ended June 30, 2026, compared to $80.8 million for the same period in 2025, an increase of $14.0 million, or 17.3%. The current accident year loss and LAE incurred totaled $109.7 million for the six months ended June 30, 2026, compared to $98.2 million for the same period in 2025. As of June 30, 2026, our estimate for loss and LAE for accident year 2026 continues to be 72.0% of net premiums earned, reflective of pressure from continued rate decreases and long-term claim frequency and severity trends, as well as medical inflation. Our initial estimate for loss and LAE for accident year 2025 of 71.0% of net premiums earned was increased to 72.0% in the fourth quarter of 2025 largely due to the frequency of severity observed in that accident year. We recorded favorable prior accident year development of $14.9 million in the first six months of 2026, compared to favorable prior accident year development of $17.4 million in the same period of 2025, as further discussed below in “Prior Year Development.” Our net loss ratio was 62.2% in the first six months of 2026, compared to 58.5% for the same period of 2025.

Current wording

Loss and Loss Adjustment Expenses Incurred. Loss and LAE incurred totaled $140.7 million for the nine months ended September 30, 2026, compared to $122.5 million for the same period in 2025, an increase of $18.2 million, or 14.9%. The current accident year loss and LAE incurred totaled $162.5 million for the nine months ended September 30, 2026, compared to $148.7 million for the same period in 2025. As of September 30, 2026, our estimate for loss and LAE for accident year 2026 continues to be 72.0% of net premiums earned, reflective of pressure from continued rate decreases and long-term claim frequency and severity trends, as well as medical inflation. Our initial estimate for loss and LAE for accident year 2025 of 71.0% of net premiums earned was increased to 72.0% in the fourth quarter of 2025 largely due to the frequency of severity observed in that accident year. For the nine months ended September 30, 2026, we are maintaining our 72.0% loss and LAE ratio estimate for accident year 2025. We recorded favorable prior accident year development of $21.8 million in the first nine months of 2026, compared to favorable prior accident year development of $26.2 million in the same period of 2025, as further discussed below in “Prior Year Development.” Our net loss ratio was 62.3% in the first nine months of 2026, compared to 58.5% for the same period of 2025.

Previous wording

Underwriting and Certain Other Operating Costs, Commissions and Salaries and Benefits. Underwriting and certain other operating costs, commissions and salaries and benefits for the six months ended June 30, 2026 were $46.9 million, compared to $42.3 million for the same period in 2025, an increase of 10.7%. This increase was primarily due to an increase in commission expense of $1.4 million, an increase in compensation expense of $0.9 million related to an incentive bonus true-up recorded in prior year, an increase in accounts receivable write-offs of $0.8 million, and a $0.7 million decrease in profit sharing reinsurance commission. Partially offsetting these amounts was a $0.3 million decrease in mandatory pooling arrangement fees. Our expense ratio was 30.8% in the first six months of 2026 compared to 30.6% for the same period of 2025.

Current wording

Underwriting and Certain Other Operating Costs, Commissions and Salaries and Benefits. Underwriting and certain other operating costs, commissions and salaries and benefits for the nine months ended September 30, 2026 were $70.7 million, compared to $64.5 million for the same period in 2025, an increase of 9.7%. This increase was primarily due to an increase in commission expense of $1.7 million, an increase in compensation expense of $1.6 million related to an incentive bonus true-up recorded in prior year, an increase in accounts receivable write-offs of $0.7 million, a $0.7 million decrease in profit sharing reinsurance commission, a $0.5 million increase in insurance related assessments and a $0.3 million increase in systems costs. Our expense ratio was 31.3% in the first nine months of 2026 compared to 30.8% for the same period of 2025.

Previous wording

Income Tax Expense. Income tax expense for the six months ended June 30, 2026 was $5.7 million, compared to $5.8 million for the same period in 2025. The effective tax rate for the Company decreased to 20.0% for the six months ended June 30, 2026 from 20.1% for the six months ended June 30, 2025. The decrease in the effective tax rate reflected the impact of tax exempt investment income on the calculation of the Company's income tax provision for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

Current wording

Income Tax Expense. Income tax expense for the nine months ended September 30, 2026 was $7.5 million, compared to $9.4 million for the same period in 2025. The effective tax rate for the Company decreased to 20.0% for the nine months ended September 30, 2026 from 20.4% for the nine months ended September 30, 2025. The decrease in the effective tax rate reflected the impact of tax exempt investment income on the calculation of the Company's income tax provision for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025.

Previous wording

Net cash used in operating activities was $0.9 million for the six months ended June 30, 2026, which represented a $9.3 million decrease from $10.2 million in net cash used in operating activities for the six months ended June 30, 2025. This decrease in cash used in operations was due to a $11.5 million increase in premium collections, a $3.8 million decrease in federal taxes paid, and a $1.5 million increase in reinsurance recoveries. Partially offsetting these impacts were a $5.4 million increase in underwriting expenses paid, a $1.3 million increase in losses paid and a $0.5 million decrease in net investment income.

Current wording

Net cash provided by operating activities was $1.9 million for the nine months ended September 30, 2026, which represented a $1.5 million increase from $0.4 million in net cash provided by operating activities for the nine months ended September 30, 2025. This increase in operating cash flow was due to a $14.0 million increase in premium collections, a $5.9 million decrease in federal taxes paid and a $1.6 million increase in reinsurance recoveries. Partially offsetting these impacts were a $13.6 million increase in losses paid, a $5.6 million increase in underwriting expenses paid, and a $0.5 million decrease in net investment income.

Previous wording

Net cash provided by investing activities was $30.3 million for the six months ended June 30, 2026, compared to net cash provided by investment activities of $33.1 million for the same period in 2025. Cash provided by sales and maturities of investments totaled $73.0 million for the six months ended June 30, 2026, compared to $54.3 million for the same period in 2025. A total of $42.7 million in cash was used to purchase investments in the six months ended June 30, 2026, compared to $20.2 million in purchases for the same period in 2025. There were immaterial purchases of property and equipment in the six months ended June 30, 2026, compared to $1.1 million for the same period in 2025.

Current wording

Net cash provided by investing activities was $9.5 million for the nine months ended September 30, 2026, compared to net cash provided by investment activities of $37.7 million for the same period in 2025. Cash provided by sales and maturities of investments totaled $95.5 million for the nine months ended September 30, 2026, compared to $79.7 million for the same period in 2025. A total of $86.0 million in cash was used to purchase investments in the nine months ended September 30, 2026, compared to $40.1 million in purchases for the same period in 2025. There were immaterial purchases of property and equipment in the nine months ended September 30, 2026, compared to $2.0 million for the same period in 2025.

Previous wording

Net cash used in financing activities in the six months ended June 30, 2026 was $25.8 million, compared to net cash used in financing activities of $18.4 million for the same period in 2025. In the six months ended June 30, 2026, $15.4 million of cash was used for dividends paid to shareholders compared to $14.9 million in the same period of 2025. In the six months ended June 30, 2026, there were repurchases of outstanding shares of our common stock of $9.7 million compared to $2.8 million for the same period in 2025. Share-based compensation related payroll tax withholding was $0.7 million in the six months ended June 30, 2026 and 2025.

Current wording

Net cash used in financing activities in the nine months ended September 30, 2026 was $33.7 million, compared to net cash used in financing activities of $27.4 million for the same period in 2025. In the nine months ended September 30, 2026, $23.0 million of cash was used for dividends paid to shareholders compared to $22.4 million in the same period of 2025. In the nine months ended September 30, 2026, there were repurchases of outstanding shares of our common stock of $9.8 million compared to $4.1 million for the same period in 2025. Share-based compensation related payroll tax withholding was $0.8 million in the nine months ended September 30, 2026 and 2025.

Previous wording

Effective June 30, 2026, the Company entered into an agreement to commute its 2024 reinsurance treaty, which provided $10 million in coverage for each loss occurrence in excess of $10 million. As no losses were incurred subject to the treaty, the Company exercised its option to commute and receive the no claims bonus provided for under the reinsurance agreement. Pursuant to the commutation agreement, the Company expects to receive a cash settlement of $0.7 million. The Company previously recognized the amount due under the no claims bonus provision as a reinsurance recoverable. Accordingly, the commutation is not expected to have an impact on the Company’s financial position or results of operations in future periods, other than the collection of the previously recognized recoverable of $0.7 million.

Current wording

Effective June 30, 2026, the Company entered into an agreement to commute its 2024 reinsurance treaty, which provided $10.0 million in coverage for each loss occurrence in excess of $10.0 million. As no losses were incurred subject to the treaty, the Company exercised its option to commute and receive the no claims bonus provided for under the reinsurance agreement. Pursuant to the commutation agreement, the Company received a cash settlement of $0.7 million. The Company previously recognized the amount due under the no claims bonus provision as a reinsurance recoverable.

Previous wording

The carrying value of our investment portfolio, including cash and cash equivalents, totaled $770.7 million at June 30, 2026, compared to $796.8 million at December 31, 2025, a decrease of 3.3%. Purchases of fixed maturity securities are classified as available-for-sale or held-to-maturity at the time of purchase based on the individual security. The Company has the ability and positive intent to hold certain investments until maturity. Therefore, fixed maturity securities classified as held-to-maturity, as defined by FASB ASC Topic 320, Investments-Debt and Equity Securities, are recorded at amortized cost net of allowance for credit losses. Our equity securities and fixed maturity securities classified as available-for-sale are reported at fair value.

Current wording

The carrying value of our investment portfolio, including cash and cash equivalents, totaled $753.3 million at September 30, 2026, compared to $796.8 million at December 31, 2025, a decrease of 5.5%. Purchases of fixed maturity securities are classified as available-for-sale or held-to-maturity at the time of purchase based on the individual security. The Company has the ability and positive intent to hold certain investments until maturity. Therefore, fixed maturity securities classified as held-to-maturity, as defined by FASB ASC Topic 320, Investments-Debt and Equity Securities, are recorded at amortized cost net of allowance for credit losses. Our equity securities and fixed maturity securities classified as available-for-sale are reported at fair value.

Previous wording

The Company recorded favorable prior accident year loss and LAE development of $7.3 million in the three months ended June 30, 2026. The table below sets forth the favorable development for the three and six months ended June 30, 2026 and 2025 for accident years 2021 through 2025 and, collectively, for all accident years prior to 2021.

Current wording

The Company recorded favorable prior accident year loss and LAE development of $6.9 million in the three months ended September 30, 2026. The table below sets forth the favorable development for the three and nine months ended September 30, 2026 and 2025 for accident years 2021 through 2025 and, collectively, for all accident years prior to 2021.

Previous wording

The table below sets forth the number of open claims as of June 30, 2026 and 2025, and the number of claims reported and closed during the three and six months then ended.

Current wording

The table below sets forth the number of open claims as of September 30, 2026 and 2025, and the number of claims reported and closed during the three and nine months then ended.

Previous wording

The number of open claims at June 30, 2026 increased by 293 claims as compared to the number of open claims at June 30, 2025. The increase in the number of claims reported is directly correlated to the increase of our in-force policy count.

Current wording

The number of open claims at September 30, 2026 increased by 670 claims as compared to the number of open claims at September 30, 2025. The increase in the number of claims reported is directly correlated to the increase of our in-force policy count.