Conifer Holdings Files Q2 2024 10-Q

TL;DR

Conifer Holdings Q2 10-Q is in: check financials and debt details.

AI Summary

Conifer Holdings, Inc. filed its 10-Q for the period ending June 30, 2024. The filing details financial performance and operations, including information on various insurance lines and debt instruments. Key financial data and operational segments are presented for the second quarter of 2024.

Why It Matters

This filing provides investors and analysts with a detailed look into Conifer Holdings' financial health and operational performance during the second quarter of 2024, impacting investment decisions.

Risk Assessment

Risk Level: medium — The filing contains details about debt instruments and financial performance, which can carry inherent risks for investors.

Key Numbers

• Q2 2024 — Reporting Period (Financial performance for the second quarter of 2024 is detailed.)
• 2023-12-31 — Previous Year End (Comparative financial data from the previous fiscal year end.)
• 2024-06-30 — Current Quarter End (Financial position as of the end of the current reporting quarter.)

Key Players & Entities

• Conifer Holdings, Inc. (company) — Filer of the 10-Q
• 20240630 (date) — End of the reporting period
• 20240813 (date) — Filing date
• FIRE, MARINE & CASUALTY INSURANCE (industry) — Standard Industrial Classification
• MI (location) — State of Incorporation
• Troy (location) — City of business address
• SeniorUnsecuredNotesMember (financial_instrument) — Type of debt mentioned
• SeniorSecuredNotesMember (financial_instrument) — Type of debt mentioned
• CommercialAndPersonalLinesMember (business_segment) — Operating segment

FAQ

Filing Documents

• cnfr-20240630.htm (10-Q) — 3499KB
• cnfr-ex31_1.htm (EX-31.1) — 15KB
• cnfr-ex31_2.htm (EX-31.2) — 18KB
• cnfr-ex32_1.htm (EX-32.1) — 8KB
• cnfr-ex32_2.htm (EX-32.2) — 9KB
• 0000950170-24-096287.txt ( ) — 14899KB
• cnfr-20240630.xsd (EX-101.SCH) — 1408KB
• cnfr-20240630_htm.xml (XML) — 3915KB

— Financial Information

Part I — Financial Information

— Financial Statements

Item 1 — Financial Statements 3 Consolidated Balance Sheets (Unaudited) 3 Consolidated Statements of Operations (Unaudited) 4 Consolidated Statements of Comprehensive Income (Loss) (Unaudited) 5 Consolidated Statements of Changes in Shareholders' Equity (Unaudited) 6 Consolidated Statements of Cash Flows (Unaudited) 7

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 8

— Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2 — Management's Discussion and Analysis of Financial Condition and Results of Operations 26

— Quantitative and Qualitative Disclosures about Market Risk

Item 3 — Quantitative and Qualitative Disclosures about Market Risk 38

— Controls and Procedures

Item 4 — Controls and Procedures 40

— Other Information

Part II — Other Information

— Legal Proceedings

Item 1 — Legal Proceedings 41

— Risk Factors

Item 1A — Risk Factors 41

— Unregistered Sales of Equity Securities and Use of Proceeds

Item 2 — Unregistered Sales of Equity Securities and Use of Proceeds 41

— Exhibits

Item 6 — Exhibits 42

Signatures

Signatures 43 2 PART 1 - FINANCI AL INFORMATION

- FINANC IAL STATEMENTS

ITEM 1 - FINANC IAL STATEMENTS CONIFER HOLDINGS, INC. AND SUBSIDIARIES Consolidated B alance Sheets (dollars in thousands) June 30, 2024 December 31, 2023 (Unaudited) Assets Investment securities: Debt securities, at fair value (amortized cost of $ 132,889 and $ 135,370 , respectively) $ 119,371 $ 122,113 Equity securities, at fair value (cost of $ 1,844 and $ 2,385 , respectively) 1,660 2,354 Short-term investments, at fair value 23,339 20,838 Total investments 144,370 145,305 Cash and cash equivalents 9,697 11,125 Premiums and agents' balances receivable, net 30,583 29,369 Receivable from Affiliate 1,174 1,047 Reinsurance recoverables on unpaid losses 74,358 70,807 Reinsurance recoverables on paid losses 8,614 12,619 Prepaid reinsurance premiums 13,494 28,908 Deferred policy acquisition costs 4,606 6,285 Other assets 6,038 6,339 Total assets $ 292,934 $ 311,804 Liabilities and Shareholders' Equity Liabilities: Unpaid losses and loss adjustment expenses $ 174,786 $ 174,612 Unearned premiums 44,820 65,150 Reinsurance premiums payable 1,408 246 Debt 24,832 25,061 Funds held under reinsurance agreements 23,602 24,550 Premiums payable to other insureds 19,299 13,986 Accounts payable and accrued expenses 5,352 5,310 Total liabilities 294,099 308,915 Commitments and contingencies Shareholders' equity: Preferred stock, no par value ( 10,000,000 shares authorized; 1,000 issued and outstanding, respectively) 6,000 6,000 Common stock, no par value ( 100,000,000 shares authorized; 12,222,881 issued and outstanding, respectively) 98,170 98,100 Accumulated deficit ( 90,559 ) ( 86,683 ) Accumulated other comprehensive income (loss) ( 14,776 ) ( 14,528 ) Total shareholders' equity ( 1,165 ) 2,889 Total liabilities and shareholders' equity $ 292,934 $ 311,804 The accompa

Business

Business The Company is engaged in the sale of property and casualty insurance products and has organized its principal operations into three types of insurance businesses: commercial lines, personal lines, and agency business. The Company underwrites a variety of specialty insurance products, including property, general liability, liquor liability, automobile, and homeowners and dwelling policies. The Company markets and sells its insurance products through a network of independent agents, including managing general agents, whereby policies are written in almost all 50 states in the United States of America ("U.S."). The Company has been in the process of strategically shifting from mostly underwriting insurance products (generating revenues through premiums) to mostly producing, or selling, insurance products through its MGA. Utilizing its existing relationships with retail agencies and other agencies, in the first quarter of 2024, the Company began producing business that was directly underwritten by a third-party insurer. By the end of the second quarter, this shift was mostly complete with the expansion of having two third-party insurers to underwrite substantially all of the commercial lines business previously underwritten by the Insurance Company Subsidiaries. The Company is currently actively considering the sale of assets and of business operations in order to raise capital with which to repay debt and improve its financial position. The Company's corporate headquarters are located in Troy, Michigan with additional office facilities in Florida and Michigan. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. While management believes the amoun

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