Investment in Joint Venture

12 Months Ended

Dec. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Investment in Joint Venture

Investment in Joint Venture

Effective September 1, 2015 Ebix and Independence Holdings Corporation ("IHC") formed a joint venture named Ebix

Health Solutions, LLC ("EbixHealth JV"). This joint venture was established to promote and market a best practices administration data exchange for health and pet insurance lines of business nationally. Ebix paid $6.0 million and contributed certain portions of its CurePet investment, valued by the EbixHealth JV at $2.0 million, for its 40% membership interest in the EbixHealth JV. IHC contributed all if its shares in its existing third party administrator operations (IHC Health Solutions, Inc.), valued by the EbixHealth JV at $12.0 million for its 60% membership interest in the EbixHealth JV. As per the joint venture agreement, any and all losses of the EbixHealth JV, (excluding certain severance payments to former employees of IHC Health Solutions, Inc.) through the period ending December 31, 2016 will be allocated to IHC, and IHC is obligated to fund any negative cash flow during this period as a loan to the EbixHealth JV, with any remaining the balance of said loan as of December 31, 2016 being then converted to contributed capital. Also, as per the joint venture agreement, Ebix has a call right during the three-year period following September 1, 2015 to purchase an additional 10% membership interest in the EbixHealth JV for a cash amount equal to the lesser of 10% of the then trailing twelve months of revenue of the EbixHealth JV, or $5.0 million. Furthermore IHC also has been and continues to be a customer of Ebix, and during the twelve months ending December 31, 2015 the Company recognized $1.5 million of revenue from IHC and as of December 31, 2015 IHC had $620 thousand of accounts receivables due to Ebix. In addition, Ebix will be rendering services to the EbixHealth JV as a customer, and in this regard during the twelve months ending December 31, 2015 the Company recognized no revenue from the EbixHealth JV. Ebix is accounting for the investment in the EbixHealth JV using the equity method whereby 40% of the EbixHealth JV periodic profits or losses will be recognized in Ebix's financial statements, after December 16, 2016. During the four-month period ending December 31, 2015 the EbixHealth JV had a net loss of $1.0 million, and as of December 31, 2015 the EbixHealth JV had net equity balance of $17.8 million.