Deferred Policy Acquisition Costs

12 Months Ended

Dec. 31, 2023

Insurance [Abstract]

Deferred Policy Acquisition Costs

4.Deferred Policy Acquisition Costs

Deferred policy acquisition costs represent those costs that are incremental and directly related to the successful acquisition of new or the renewal of existing insurance policies. We defer incremental costs that result directly from, and are essential to, the acquisition or renewal of an insurance policy.

We also defer a portion of employee total compensation costs directly related to time spent performing specific acquisition or renewal activities.

These costs are deferred and expensed over the life of the related policies. Major categories of the Company’s deferred policy acquisition costs are summarized as follows:

	December 31,
	2023		2022
	(in thousands)
Agents’ commissions	$	12,955	$	12,578
Premium taxes		2,672		2,587
Deferred underwriting expenses		2,348		2,236
Total deferred policy acquisition costs	$	17,975	$	17,401

The following summarizes the activity in the deferred policy acquisition costs:

	Year Ended December 31,
	2023			2022			2021
	(in thousands)
Balance, beginning of year	$	17,401		$	17,059		$	17,810
Policy acquisition costs deferred		41,433			40,194			37,730
Amortization expense during the year		(40,859	)		(39,852	)		(38,481	)
Balance, end of year	$	17,975		$	17,401		$	17,059