Revenue from Contracts with Customers

6 Months Ended

Jun. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

Revenue from Contracts with Customers

The Company’s revenues from insurance and contractual and liability insurance operations are primarily accounted for under Financial Services-Insurance (ASC 944) that are not within the scope of Revenue for Contracts with Customers (ASC 606). The Company’s remaining revenues that are within the scope of ASC 606 are primarily comprised of revenues from contracts with customers for monthly membership dues for motor clubs, monthly administration fees for services provided for premiums, claims and reinsurance processing revenues, vehicle service contracts, vessel related revenue and revenues for household goods and appliances service contracts (collectively, remaining contracts).

The following table presents the disaggregated amounts of revenue from contracts with customers by product type for the following periods:

	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Service and Administrative Fees:
Service contract revenue	$	76,179	$	73,014	$	157,002	$	136,184
Motor club revenue	11,116		11,603		22,637		24,119
Other	829		1,171		1,787		2,674
Revenue from contracts with customers	$	88,124	$	85,788	$	181,426	$	162,977

Service and Administrative Fees

Service and administrative fees are generated from non-insurance programs including warranty service contracts, motor clubs and other services. Service and administrative fees are recognized consistent with the earnings recognition pattern of the underlying policies, debt cancellation contracts and motor club memberships being administered, using pro rata, Rule of 78’s, modified Rule of 78’s, or other methods as appropriate for the contract. Management selects the appropriate method based on available information, and periodically reviews the selections as additional information becomes available.

Management reviews the financial results under each significant contract on a monthly basis. Any losses that may occur due to a specific contract would be recognized in the period in which the loss is determined to be probable.

We do not disclose information about remaining performance obligations pertaining to contracts that have an original expected duration of one year or less. The transaction price allocated to remaining unsatisfied or partially unsatisfied performance obligations with an original expected duration exceeding one year was not material as of June 30, 2024.

The timing of our revenue recognition may differ from the timing of payment by our customers. We record a receivable when revenue is recognized prior to payment and we have an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, we record deferred revenue until the performance obligations are satisfied.

The following table presents the activity in the deferred assets and liabilities related to revenue from contracts with customers for the following period:

	January 1, 2024						June 30, 2024
	Beginning balance		Additions		Amortization		Ending balance
Deferred acquisition costs
Service and Administrative Fees:
Service contract revenue	$	201,903	$	62,495	$	54,062	$	210,336
Motor club revenue	16,636		15,497		17,587		14,546
Total	$	218,539	$	77,992	$	71,649	$	224,882

Deferred revenue
Service and Administrative Fees:
Service contract revenue	$	605,425	$	166,484	$	157,002	$	614,907
Motor club revenue	21,677		19,684		22,637		18,724
Other	—		1,765		1,765		—
Total	$	627,102	$	187,933	$	181,404	$	633,631

For the periods presented, no write-offs for unrecoverable deferred acquisition costs and deferred revenue were recognized.