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What changed in AMERISAFE INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of AMERISAFE INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+338 added−351 removedSource: 10-K (2026-02-27) vs 10-K (2025-02-28)

Top changes in AMERISAFE INC's 2025 10-K

338 paragraphs added · 351 removed · 306 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

117 edited+11 added−18 removed143 unchanged
Biggest changeA deficiency means that the current estimate is higher than the original estimate. 12 Analysis of Loss and Loss Adjustment Expense Reserve Development Year Ended December 31, 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 (in thousands) Reserve for loss and loss adjustment expenses, net of reinsurance recoverables $ 628,268 $ 653,175 $ 664,520 $ 686,956 $ 691,193 $ 677,544 $ 654,854 $ 626,012 $ 583,482 $ 554,248 $ 538,567 Net reserve estimated as of: One year later 580,454 601,868 629,750 641,360 626,192 614,060 592,937 585,421 542,086 519,362 Two years later 529,149 567,098 584,149 576,358 562,709 552,143 552,345 544,024 507,200 Three years later 504,437 530,582 528,659 527,722 514,889 517,763 518,432 511,928 Four years later 484,964 498,494 494,513 498,173 493,631 491,301 490,020 Five years later 467,382 473,137 473,097 485,768 475,184 469,239 Six years later 451,232 458,115 464,296 470,837 456,159 Seven years later 440,039 450,531 451,432 453,357 Eight years later 433,298 440,705 436,802 Nine years later 425,002 427,282 Ten years later 413,636 Net cumulative redundancy $ 214,632 $ 225,893 $ 227,718 $ 233,599 $ 235,034 $ 208,305 $ 164,833 $ 114,084 $ 76,282 $ 34,886 Cumulative amount of reserve paid, net of reserve recoveries, through: One year later 135,711 135,601 129,937 138,593 131,108 129,803 137,348 143,892 130,290 120,079 Two years later 203,855 202,063 202,928 205,705 199,284 207,382 203,243 214,641 189,753 Three years later 240,098 247,751 241,165 247,609 242,983 245,749 244,417 246,598 Four years later 267,143 272,144 268,049 271,213 267,293 270,359 261,784 Five years later 279,944 289,001 282,368 286,865 283,863 278,997 Six years later 293,197 298,074 290,057 299,720 288,403 Seven years later 299,782 303,762 300,918 301,861 Eight years later 304,276 310,185 301,951 Nine years later 309,450 310,269 Ten years later 310,544 Net reserve— December 31 $ 628,268 $ 653,175 $ 664,520 $ 686,956 $ 691,193 $ 677,544 $ 654,854 $ 626,012 $ 583,482 $ 554,248 $ 538,567 Reinsurance recoverables 59,334 64,858 78,256 84,889 107,216 95,343 105,707 119,266 112,555 119,746 112,742 Gross reserve— December 31 $ 687,602 $ 718,033 $ 742,776 $ 771,845 $ 798,409 $ 772,887 $ 760,561 $ 745,278 $ 696,037 $ 673,994 $ 651,309 Net re-estimated reserve $ 413,636 $ 427,282 $ 436,802 $ 453,357 $ 456,159 $ 469,239 $ 490,020 $ 511,928 $ 507,200 $ 519,362 Re-estimated reinsurance recoverables 41,202 42,200 46,877 58,129 61,093 71,826 77,979 102,132 100,033 103,954 Gross re-estimated reserve $ 454,838 $ 469,482 $ 483,679 $ 511,486 $ 517,252 $ 541,065 $ 567,999 $ 614,060 $ 607,233 $ 623,316 Gross cumulative redundancy $ 232,764 $ 248,551 $ 259,097 $ 260,359 $ 281,157 $ 231,822 $ 192,562 $ 131,218 $ 88,804 $ 50,678 Investments We derive net investment income from our invested assets.
Biggest changeA deficiency means that the current estimate is higher than the original estimate. 12 Analysis of Loss and Loss Adjustment Expense Reserve Development Year Ended December 31, 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 (in thousands) Reserve for loss and loss adjustment expenses, net of reinsurance recoverables $ 653,175 $ 664,520 $ 686,956 $ 691,193 $ 677,544 $ 654,854 $ 626,012 $ 583,482 $ 554,248 $ 538,567 $ 507,508 Net reserve estimated as of: One year later 601,868 629,750 641,360 626,192 614,060 592,937 585,421 542,086 519,362 504,702 Two years later 567,098 584,149 576,358 562,709 552,143 552,345 544,024 507,200 485,498 Three years later 530,582 528,659 527,722 514,889 517,763 518,432 511,928 474,916 Four years later 498,494 494,513 498,173 493,631 491,301 490,020 483,867 Five years later 473,137 473,097 485,768 475,184 469,239 467,093 Six years later 458,115 464,296 470,837 456,159 452,968 Seven years later 450,531 451,432 453,357 439,903 Eight years later 440,705 436,802 438,583 Nine years later 427,282 423,433 Ten years later 415,512 Net cumulative redundancy $ 237,663 $ 241,086 $ 248,373 $ 251,290 $ 224,576 $ 187,760 $ 142,145 $ 108,566 $ 68,751 $ 33,865 Cumulative amount of reserve paid, net of reserve recoveries, through: One year later 135,601 129,937 138,593 131,108 129,803 137,348 143,892 130,290 120,079 141,861 Two years later 202,063 202,928 205,705 199,284 207,382 203,243 214,641 189,753 189,391 Three years later 247,751 241,165 247,609 242,983 245,749 244,417 246,598 228,806 Four years later 272,144 268,049 271,213 267,293 270,359 261,784 272,202 Five years later 289,001 282,368 286,865 283,863 278,997 279,577 Six years later 298,074 290,057 299,720 288,403 292,583 Seven years later 303,762 300,918 301,861 298,112 Eight years later 310,185 301,951 309,509 Nine years later 310,269 307,374 Ten years later 314,831 Net reserve— December 31 $ 653,175 $ 664,520 $ 686,956 $ 691,193 $ 677,544 $ 654,854 $ 626,012 $ 583,482 $ 554,248 $ 538,567 $ 507,508 Reinsurance recoverables 64,858 78,256 84,889 107,216 95,343 105,707 119,266 112,555 119,746 112,742 106,075 Gross reserve— December 31 $ 718,033 $ 742,776 $ 771,845 $ 798,409 $ 772,887 $ 760,561 $ 745,278 $ 696,037 $ 673,994 $ 651,309 $ 613,583 Net re-estimated reserve $ 415,512 $ 423,433 $ 438,583 $ 439,903 $ 452,968 $ 467,093 $ 483,867 $ 474,916 $ 485,498 $ 504,702 Re-estimated reinsurance recoverables 37,821 42,499 53,368 56,331 67,064 74,467 96,184 92,334 91,255 100,043 Gross re-estimated reserve $ 453,333 $ 465,932 $ 491,951 $ 496,234 $ 520,032 $ 541,560 $ 580,051 $ 567,250 $ 576,753 $ 604,745 Gross cumulative redundancy $ 264,700 $ 276,844 $ 279,894 $ 302,175 $ 252,855 $ 219,001 $ 165,227 $ 128,787 $ 97,241 $ 46,564 Investments We derive net investment income from our invested assets.
Our quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports that we file or furnish pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available through our website, free of charge, as soon as reasonably practicable after they have been electronically filed or furnished to the U.S.
Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports that we file or furnish pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available through our website, free of charge, as soon as reasonably practicable after they have been electronically filed or furnished to the U.S.
Such providers comprise not only our recommended medical providers, but also nurse case managers, independent medical examiners, vocational specialists, rehabilitation specialists and other specialty providers of medical services necessary to achieve a quality outcome. 7 Following notification of a workplace injury, an FCM will contact the policyholder, the injured employee and/or the treating physician to determine the nature and severity of the injury.
Such providers comprise not only our recommended medical providers, but also nurse case managers, independent medical examiners, vocational specialists, rehabilitation specialists and other specialty providers of medical services necessary to achieve a quality outcome. 7 Following notification of a workplace injury, a FCM will contact the policyholder, the injured employee and/or the treating physician to determine the nature and severity of the injury.
As of December 31, 2024, we had 3,798 open claims, with an average of $171,487 in unpaid loss and loss adjustment expenses per open claim. During the year ended December 31, 2024, 3,827 new claims were reported, and 4,032 claims were closed. 11 In 2024, our gross reserves decreased to $651.3 million from $674.0 million at December 31, 2023.
As of December 31, 2024, we had 3,798 open claims, with an average of $171,487 in unpaid loss and loss adjustment expenses per open claim. During the year ended December 31, 2024, 3,827 new claims were reported, and 4,032 claims were closed. In 2024, our gross reserves decreased to $651.3 million from $674.0 million at December 31, 2023.
To accomplish this objective, we intend to maintain underwriting profitability throughout market cycles, optimize our use of reinsurance, deploy appropriate capital management tools, including paying dividends to shareholders and share repurchases, and produce an appropriate risk adjusted return on our investment portfolio. Industry Overview.
To accomplish this objective, we intend to maintain underwriting profitability throughout market cycles, optimize our use of reinsurance, deploy appropriate capital management tools, including paying dividends to shareholders and share repurchases, and produce an appropriate risk-adjusted return on our investment portfolio. 3 Industry Overview.
Includes a broad spectrum of diverse operations including contract haulers, regional and local freight carriers, special equipment transporters and other trucking companies that conduct a variety of short- and long-haul operations. Logging and Lumber. Includes tree harvesting, tree trimming, sawmills, and other operations associated with lumber and wood products. Agriculture.
Includes a broad spectrum of diverse operations including contract haulers, regional and local freight carriers, special equipment transporters and other trucking companies that conduct a variety of short- and long-haul operations. Logging and Lumber. Includes tree harvesting, tree trimming, sawmills, and other operations associated with lumber and wood products. 4 Agriculture.
Pearson has served as our Senior Vice President and Controller since October 2019 and previously served as Vice President and Controller from 2012 until October 2019. She has been employed with our Company since 1996. 20 Regulation Holding Company Regulation Nearly all states have enacted legislation that regulates insurance holding company systems.
Pearson has served as our Senior Vice President and Controller since October 2019 and previously served as Vice President and Controller from 2012 until October 2019. She has been employed with our Company since 1996. Regulation Holding Company Regulation Nearly all states have enacted legislation that regulates insurance holding company systems.
The USL&H Act requires employers to provide medical benefits, compensation for lost wages, and rehabilitation services to longshoremen, harbor workers and other maritime workers who may suffer injury, disability or death during the course and scope of their employment.
The USL&H Act requires employers to provide medical benefits, compensation for lost wages, and rehabilitation services to longshoremen, harbor workers and certain other maritime workers who may suffer injury, disability or death during the course and scope of their employment.
The principal concept underlying workers’ compensation laws is that employees injured in the course and scope of their employment have only the legal remedies available under workers’ 3 compensation laws and do not have any other recourse against their employer.
The principal concept underlying workers’ compensation laws is that employees injured in the course and scope of their employment have only the legal remedies available under workers’ compensation laws and do not have any other recourse against their employer.
In addition, to minimize our exposure to significant losses from reinsurer insolvencies, we evaluate the financial condition of our reinsurers and monitor concentrations of credit risk on a continual basis. 2025 Excess of Loss Reinsurance Treaty Program Our reinsurance treaty program consists of four layers of coverage and provides us with reinsurance coverage for each loss occurrence up to $100.0 million, subject to applicable limitations, deductibles, retentions and aggregate limits.
In addition, to minimize our exposure to significant losses from reinsurer insolvencies, we evaluate the financial condition of our reinsurers and monitor concentrations of credit risk on a continual basis. 2026 Excess of Loss Reinsurance Treaty Program Our reinsurance treaty program consists of four layers of coverage and provides us with reinsurance coverage for each loss occurrence up to $100.0 million, subject to applicable limitations, deductibles, retentions and aggregate limits.
In addition, we believe that our insurance is competitively priced and our premium rates are typically lower than those for policyholders assigned to the state insurance pools, allowing us to provide a viable alternative for policyholders in those pools. 18 Human Capital Throughout our 39-year history, the retention, growth and development of our employees has been critical to our success.
In addition, we believe that our insurance is competitively priced and our premium rates are typically lower than those for policyholders assigned to the state insurance pools, allowing us to provide a viable alternative for policyholders in those pools. 18 Human Capital Throughout our 40-year history, the retention, growth and development of our employees has been critical to our success.
In addition, state law prohibits us from limiting our workers’ compensation insurance losses arising from any one catastrophe or any one claimant. We have reinsurance protection in our current reinsurance treaty program that provides coverage of up to $100.0 million for losses arising from acts of terrorism. This coverage is effective through December 31, 2025.
In addition, state law prohibits us from limiting our workers’ compensation insurance losses arising from any one catastrophe or any one claimant. We have reinsurance protection in our current reinsurance treaty program that provides coverage of up to $100.0 million for losses arising from acts of terrorism. This coverage is effective through December 31, 2026.
For insured losses in 2025, each insurance group is responsible for a statutory deductible under the 2019 Act that is equal to 20% of its direct earned property and casualty insurance premiums. For losses occurring in 2025, the U.S. federal government will reimburse 80% of an insurance group’s covered losses over the statutory deductible.
For insured losses in 2026, each insurance group is responsible for a statutory deductible under the 2019 Act that is equal to 20% of its direct earned property and casualty insurance premiums. For losses occurring in 2026, the U.S. federal government will reimburse 80% of an insurance group’s covered losses over the statutory deductible.
Strategy We intend to produce favorable returns on equity and increase our book value per share adjusted for dividends paid to shareholders using the following strategies: Focus on Underwriting Profitability. We intend to maintain our underwriting discipline throughout market cycles with the objective of remaining profitable.
Strategy We strive to produce favorable returns on equity and increase our book value per share adjusted for dividends paid to shareholders and share repurchases using the following strategies: Focus on Underwriting Profitability. We intend to maintain our underwriting discipline throughout market cycles with the objective of remaining profitable.
In establishing our reserves, we review the results of analyses using actuarial methodologies that utilize historical loss data from our 39 years of underwriting workers’ compensation insurance. In evaluating the results of those analyses, our management also uses substantial judgment in considering other factors that are not considered in these actuarial analyses.
In establishing our reserves, we review the results of analyses using actuarial methodologies that utilize historical loss data from our 40 years of underwriting workers’ compensation insurance. In evaluating the results of those analyses, our management also uses substantial judgment in considering other factors that are not considered in these actuarial analyses.
For our paid and incurred development methods, we varied both the cumulative paid and incurred loss development factors (LDFs) by an increase and decrease of 30%, both individually and in combination with one another. The results of this sensitivity analysis, using December 31, 2024 data, are summarized below.
For our paid and incurred development methods, we varied both the cumulative paid and incurred loss development factors (LDFs) by an increase and decrease of 30%, both individually and in combination with one another. The results of this sensitivity analysis, using December 31, 2025 data, are summarized below.
The Company generally secures large reinsurance recoverable balances with various forms of collateral, including funds withheld accounts, irrevocable letters of credit and secured trusts. The table below summarizes our amounts recoverable from reinsurers as of December 31, 2024. Reinsurer A.M.
The Company generally secures large reinsurance recoverable balances with various forms of collateral, including funds withheld accounts, irrevocable letters of credit and secured trusts. The table below summarizes our amounts recoverable from reinsurers as of December 31, 2025. Reinsurer A.M.
The investments in Louisiana result from companies being allowed an investment credit against Louisiana premium taxes for varying levels of Louisiana assets. The table below summarizes the top five geographic exposures as of December 31, 2024.
The investments in Louisiana result from companies being allowed an investment credit against Louisiana premium taxes for varying levels of Louisiana assets. The table below summarizes the top five geographic exposures as of December 31, 2025.
The “gross cumulative redundancy (deficiency)” represents, as of December 31, 2024, the difference between the latest re-estimated liability and the amounts as originally estimated. A redundancy means that the original estimate was higher than the current estimate.
The “gross cumulative redundancy (deficiency)” represents, as of December 31, 2025, the difference between the latest re-estimated liability and the amounts as originally estimated. A redundancy means that the original estimate was higher than the current estimate.
We are committed to the health, safety and wellness of our employees as the success of our business is fundamentally connected to the well-being of our people. Our benefit offerings are designed to meet the varied and evolving needs of a diverse workforce.
We are committed to the health, safety and wellness of our employees as the success of our business is fundamentally connected to the well-being of our people. Our benefit offerings are designed to meet the varied and evolving needs of our workforce.
IRIS identifies 13 industry ratios and specifies “usual values” for each ratio. Departure from the usual values on four or more of the ratios can lead to inquiries from individual state insurance commissioners as to certain aspects of an insurer’s business. The 2024 IRIS results for AIIC and SOCI were within expected values for all 13 industry ratios.
IRIS identifies 13 industry ratios and specifies “usual values” for each ratio. Departure from the usual values on four or more of the ratios can lead to inquiries from individual state insurance commissioners as to certain aspects of an insurer’s business. The 2025 IRIS results for AIIC, SOCI and ATEX were within expected values for all 13 industry ratios.
The insurance companies with which we compete vary by state and by the industries we target. Market conditions are also impacted by lower estimated loss costs adopted by a number of states in which we do business. Our competitive advantages include our underwriting expertise, safety services and claims management practices, our A.M.
The insurance companies with which we compete vary by state and by the industries we target. Market conditions are also impacted by lower estimated loss costs adopted by a number of states in which we do business. Our competitive advantages include our specialized underwriting expertise, comprehensive safety services and proactive claims management practices, our A.M.
Among the proposals that have in the past been, or are at present, being considered are the possible introduction of federal regulation in addition to, or in lieu of, the current system of state regulation of insurers and proposals in various state legislatures (some of which proposals have been enacted) to conform portions of their insurance laws and regulations to various model acts adopted by the NAIC.
Among the proposals that have in the past been considered are the possible introduction of federal regulation in addition to, or in lieu of, the current system of state regulation of insurers and proposals in various state legislatures (some of which have been enacted) to conform portions of their insurance laws and regulations to various model acts adopted by the NAIC.
We make substantial investments in improving our systems on an ongoing basis. We provide our field premium auditors, FSPs and field case managers with computer and communication equipment to efficiently complete services. We deploy technology and equipment to enable remote work when needed and to ensure continuity of home office and field operations.
We make substantial investments in improving our systems on an ongoing basis. We provide our field premium auditors, FSPs and FCMs with computer and communication equipment to efficiently complete services. We deploy technology and equipment to enable remote work when needed and to ensure continuity of home office and field operations.
Model insurance laws, regulations and guidelines, which we refer to as the Model Laws, have been promulgated by the NAIC as a minimum standard by which state regulatory systems and regulations are measured. Adoption of state laws that provide for substantially similar regulations to those described in the Model Laws is a requirement for accreditation by the NAIC.
Model insurance laws, regulations and guidelines (collectively, the "Model Laws") have been promulgated by the NAIC as a minimum standard by which state regulatory systems and regulations are measured. Adoption of state laws that provide for substantially similar regulations to those described in the Model Laws is a requirement for accreditation by the NAIC.
The Company’s 2025 catastrophe excess of loss layer for loss occurrences greater than $10.0 million includes coverage for losses caused by nuclear, biological, chemical and radiological attacks, subject to the deductibles, retentions, definitions and aggregate limits. Technology We view our information systems as an integral part of our operations.
The Company’s 2026 catastrophe excess of loss layers for loss occurrences greater than $10.0 million includes coverage for losses caused by nuclear, biological, chemical and radiological attacks, subject to the deductibles, retentions, definitions and aggregate limits. Technology We view our information systems as an integral part of our operations.
We utilize intensive claims management practices that we believe permit us to reduce the overall cost of our claims. In addition, our premium audit services calculate the appropriate premiums for our policyholders under the terms of their policies and enable us to monitor payroll patterns that cause underwriting, safety or fraud concerns.
We utilize proactive claims management practices that we believe ultimately reduce the overall cost of our claims. In addition, our premium audit services calculate the appropriate premiums for our policyholders under the terms of their policies and enable us to monitor payroll patterns that cause underwriting, safety or fraud concerns.
Loss Development The table below shows the net loss development for business written each year from 2014 through 2024. The table reflects the changes in our loss and loss adjustment expense reserves in subsequent years from the prior loss estimates based on experience as of the end of each succeeding year on a generally accepted accounting principles (GAAP) basis.
Loss Development The table below shows the net loss development for business written each year from 2015 through 2025. The table reflects the changes in our loss and loss adjustment expense reserves in subsequent years from the prior loss estimates based on experience as of the end of each succeeding year on a generally accepted accounting principles (GAAP) basis.
As a provider of workers’ compensation insurance for employers engaged in the maritime industry, we are subject to the United States Longshore and Harbor Workers’ Compensation Act (USL&H) and the Merchant Marine Act of 1920 (Jones Act).
As a provider of workers’ compensation insurance for employers engaged in the maritime industry, we are subject to the United States Longshore and Harbor Workers’ Compensation Act (USL&H Act) and the Merchant Marine Act of 1920 (Jones Act). We are also subject to regulations related to the USL&H Act and the Jones Act.
Based on data received from the National Association of Insurance Commissioners (NAIC) we do not have more than 4.2% of the market share in any state we serve. As a result, we believe we have the opportunity to increase market penetration in each of the states in which we currently operate.
Based on data received from the National Association of Insurance Commissioners (NAIC), we do not have more than 5.0% of the market share in any state we serve. As a result, we believe we have the opportunity to increase market penetration in each of the states in which we currently operate.
As of December 31, 2024, we averaged 44 open indemnity claims per FCM, which we believe is significantly less than the industry average. Locating our FCMs in the field also allows us to build professional relationships with local medical providers.
As of December 31, 2025, we averaged 51 open indemnity claims per FCM, which we believe is significantly less than the industry average. Locating our FCMs in the field also allows us to build professional relationships with local medical providers.
If we commute the reinsurers’ obligations, we are entitled to receive a portion of the premiums that were paid to the reinsurers prior to the effective dates of the applicable commutations, subject to certain adjustments provided in the agreement. We have 26 reinsurers participating in our reinsurance treaty program in 2025.
If we commute the reinsurers’ obligations, we are entitled to receive a portion of the premiums that were paid to the reinsurers prior to the effective dates of the applicable commutations, subject to certain adjustments provided in the agreement. We have 24 reinsurers participating in our reinsurance treaty program in 2026.
Virgin Islands. We operate on a geographically diverse basis with 14.7% or less of our gross premiums written in 2024 derived from any one state. The table below identifies, for the years ended December 31, 2024, 2023 and 2022, the states in which the percentage of our gross premiums written exceeded 3.0% for any of the three years presented.
Virgin Islands. We operate on a geographically diverse basis with 16.3% or less of our gross premiums written in 2025 derived from any one state. The table below identifies, for the years ended December 31, 2025, 2024 and 2023, the states in which the percentage of our gross premiums written exceeded 3.0% for any of the three years presented.
The table below shows the composition of our fixed maturity securities by remaining time to maturity as of December 31, 2024.
The table below shows the composition of our fixed maturity securities by remaining time to maturity as of December 31, 2025.
She has been employed with our Company since 1995 and served as Regional Vice President, Underwriting Operations from September 2011 to July 2022. Henry O. (Chris) Lestage, IV has served as our Senior Vice President, Claims Operations since September 2000. He has been employed with our Company since 1987. Michael C.
She has been employed with our Company since 1995 and served as Regional Vice President, Underwriting Operations from September 2011 to July 2022. Henry O. (Chris) Lestage, IV has served as our Senior Vice President, Claims Operations since September 2000. He has been employed with our Company since 1987. Angela W.
These initial inspections allow our underwriting professionals to make decisions on both insurability and pricing. In certain circumstances, we will agree to provide workers’ compensation insurance only if the employer agrees to implement and maintain the safety management practices that we recommend. In 2024, 92.5% of our new voluntary business policyholders were inspected prior to our offering a premium quote.
These initial inspections allow our underwriting professionals to make decisions on both insurability and pricing. In certain circumstances, we will agree to provide workers’ compensation insurance only if the employer agrees to implement and maintain the safety management practices that we recommend. In 2025, 93.4% of our new voluntary business policyholders were inspected prior to our offering a premium quote.
As of December 31, 2024, our ten largest voluntary business policyholders accounted for 2.3% of our in-force premiums. Our policy renewal rate on voluntary business that we elected to quote for renewal was 94.2% in 2024, 94.1% in 2023, and 93.8% in 2022.
As of December 31, 2025, our ten largest voluntary business policyholders accounted for 2.1% of our in-force premiums. Our policy renewal rate on voluntary business that we elected to quote for renewal was 93.1% in 2025, 94.2% in 2024, and 94.1% in 2023.
For the year ended December 31, 2024, our assumed premiums from mandatory pooling arrangements accounted for 2.9% of our gross premiums written. Targeted Industries We provide workers’ compensation insurance primarily to employers in the following targeted hazardous industries: Construction.
For the year ended December 31, 2025, our assumed premiums from mandatory pooling arrangements accounted for 2.8% of our gross premiums written. Targeted Industries We provide workers’ compensation insurance primarily to employers in the following targeted hazardous industries: Construction.
Neither our independent agencies nor our insurance agency subsidiary has authority to underwrite or bind coverage. We do not pay contingent commissions. As of December 31, 2024, independent agencies accounted for 98.4% of our voluntary in-force premiums. No single independent agency accounted for more than 2.0% of our voluntary in-force premiums at that date.
Neither our independent agencies nor our insurance agency subsidiary has authority to underwrite or bind coverage. We do not pay contingent commissions. As of December 31, 2025, independent agencies accounted for 99.0% of our voluntary in-force premiums. No single independent agency accounted for more than 2.0% of our voluntary in-force premiums at that date.
We may also be exposed to future privacy laws and regulations, which could impose additional costs and impact our results of operations or financial condition. In 2000, the NAIC adopted the Privacy of Consumer Financial and Health Information Model Regulation, which assisted states in promulgating regulations to comply with the Gramm-Leach-Bliley Act.
We may also be exposed to future privacy laws and regulations, which could impose additional costs and impact our results of operations or financial condition. In 2000, the NAIC adopted the Privacy of Consumer Financial and Health Information Model Regulation, which assisted states in promulgating regulations to comply with the GLBA.
Item 1. Business. Overview We are a specialty provider of workers’ compensation insurance focused on small to mid-sized employers engaged in hazardous industries, principally construction, trucking, logging and lumber, agriculture, manufacturing, maritime, and telecommunications. Since commencing operations in 1986, we have gained significant experience underwriting the complex workers’ compensation exposures inherent in these industries.
Item 1. Business. Overview AMERISAFE, Inc. is a specialty provider of workers’ compensation insurance focused on small to mid-sized employers engaged in hazardous industries, principally construction, trucking, logging and lumber, agriculture, services, manufacturing, and maritime. Since commencing operations in 1986, we have gained significant experience underwriting the complex workers’ compensation exposures inherent in these industries.
For example, as of December 31, 2014, it was estimated that $628.3 million would be sufficient to settle all claims not already settled that had occurred on or prior to December 31, 2014, whether reported or unreported. The next section of the table sets forth the re-estimates in later years of incurred losses, including payments, for the years indicated.
For example, as of December 31, 2015, it was estimated that $653.2 million would be sufficient to settle all claims not already settled that had occurred on or prior to December 31, 2015, whether reported or unreported. The next section of the table sets forth the re-estimates in later years of incurred losses, including payments, for the years indicated.
While we actively market our insurance in 27 states, 51.5% of our voluntary in-force premiums were generated in the six states where we derived 5.0% or more of our gross premiums written in 2024. We are licensed in an additional 20 states, the District of Columbia and the U.S. Virgin Islands.
While we actively market our insurance in 27 states, 53.6% of our voluntary in-force premiums were generated in the six states where we derived 5.0% or more of our gross premiums written in 2025. We are licensed in an additional 20 states, the District of Columbia and the U.S. Virgin Islands.
Includes direct premiums from workers’ compensation insurance policies that we issue to employers assigned to us under residual market programs implemented by some of the states in which we operate. Beginning in 2023, the Company participated in the mandatory pooling arrangements instead of the assigned risk business. • Assumed Premiums.
Included direct premiums from workers’ compensation insurance policies that we issued to employers assigned to us under residual market programs implemented by some of the states in which we operate. Beginning in 2023, the Company participated in the mandatory pooling arrangements instead of the assigned risk business.
We also work with our employees to provide training in leadership development, professional development, project management skills and interpersonal skills development. 19 Information About our Executive Officers The table below sets forth information about our executive officers and key employees as of February 28, 2025. Name Age Position Executive Officers G.
We also work with our employees to provide training in leadership development, professional development, project management skills and interpersonal skills development. Information About our Executive Officers The table below sets forth information about our executive officers and key employees as of February 27, 2026. Name Age Position Executive Officers G.
She served as our Executive Vice President and Chief Financial Officer from November 2008 to April 2013, our Controller from May 2004 to November 2008 and Vice President from May 2006 to November 2008. She has been employed with our Company since 1992. Anastasios G.
She served as our Executive Vice President and Chief Financial Officer from November 2008 to April 2013, our Controller from May 2004 to November 2008 and Vice President from May 2006 to November 2008. She has been employed with our Company since 1992. Vincent J.
AIIC and SOCI underwent an examination by the Nebraska Department of Insurance in 2022 and 2023 which covered calendar years 2018 through 2021. AIICTX underwent an examination by the Texas Department of Insurance in 2022 and 2023 which covered calendar years 2018 through 2021.
AIICTX underwent an examination by the Texas Department of Insurance in 2022 and 2023 which covered calendar years 2018 through 2021.
Accordingly, SAPs focus on valuing assets and liabilities of insurers at financial reporting dates in accordance with appropriate insurance law and regulatory provisions applicable in each insurer’s domiciliary state. Generally accepted accounting principles (GAAP) are concerned with a company’s solvency, but are also concerned with other financial measurements, principally income and cash flows.
Accordingly, SAPs focus on valuing assets and liabilities of insurers at financial reporting dates in accordance with appropriate insurance law and regulatory provisions applicable in each insurer’s domiciliary state. GAAP is concerned with a company’s solvency, but is also concerned with other financial measurements, principally income and cash flows.
The results of this sensitivity analysis, using December 31, 2024 data, are summarized below.
The results of this sensitivity analysis, using December 31, 2025 data, are summarized below.
Our recoveries from state-managed trust funds for the years ended December 31, 2024, 2023 and 2022 were $4.0 million, $2.9 million and $3.6 million, respectively. Our cash paid for assessments to state-managed trust funds for the years ended December 31, 2024, 2023 and 2022 was $1.0 million, $1.8 million and $0.1 million, respectively.
Our recoveries from state-managed trust funds for the years ended December 31, 2025, 2024 and 2023 were $5.6 million, $4.0 million and $2.9 million, respectively. Our cash paid for assessments to state-managed trust funds for the years ended December 31, 2025, 2024 and 2023 was $0.7 million, $1.0 million and $1.8 million, respectively.
Privacy Regulations In 1999, Congress enacted the Gramm-Leach-Bliley Act which, among other things, protects consumers from the unauthorized dissemination of certain personal information. Subsequently, a majority of states have implemented additional regulations to address privacy issues.
Privacy Regulations In 1999, Congress enacted the Gramm-Leach-Bliley Act ("GLBA") which, among other things, protects consumers from the unauthorized dissemination of nonpublic personal information. Subsequently, states have implemented additional regulations to address privacy issues.
Through cost management initiatives, we maintain one of the more efficient operations in the workers’ compensation industry. In 2024, our expense ratio was 29.6%. We believe that our expense ratio is generally lower than that of our competitors, which gives us a greater opportunity to generate underwriting profit.
Through cost management initiatives, we maintain one of the more efficient operations in the workers’ compensation industry. In 2025, our expense ratio was 30.4%. We believe that our expense ratio is generally lower than that of our competitors, which gives us a greater opportunity to generate underwriting profit.
Janelle Frost has served as our Chief Executive Officer since April 2015 and President since September 2013. She has served as a Director of the Company since April 2016. Prior to becoming our Chief Executive Officer, Ms. Frost served as Chief Operating Officer from May 2013 to April 2015.
Janelle Frost has served as our Chief Executive Officer since April 2015, President since September 2013 and interim Principal Financial Officer since November 2025. She has served as a Director of the Company since April 2016. Prior to becoming our Chief Executive Officer, Ms. Frost served as Chief Operating Officer from May 2013 to April 2015.
Federal Law and Regulations For the year ended December 31, 2024, we derived 3.9% of our voluntary in-force premiums from employers engaged in the maritime industry.
Federal Law and Regulations For the year ended December 31, 2025, we derived 3.2% of our voluntary in-force premiums from employers engaged in the maritime industry.
Percentage of Gross Premiums Written Year Ended December 31, State 2024 2023 2022 Florida 14.7 % 13.4 % 11.8 % Georgia 10.3 % 10.9 % 11.0 % Pennsylvania 7.2 % 7.6 % 7.8 % Illinois 6.6 % 5.1 % 4.5 % Louisiana 6.0 % 7.5 % 8.2 % North Carolina 5.9 % 5.9 % 6.9 % Texas 3.9 % 2.6 % 2.4 % Wisconsin 3.8 % 4.3 % 4.3 % Virginia 3.7 % 3.7 % 4.1 % Alaska 3.4 % 3.0 % 3.2 % Minnesota 3.1 % 3.2 % 3.7 % South Carolina 3.0 % 3.3 % 3.6 % Alabama 2.9 % 2.8 % 3.2 % Total 74.5 % 73.3 % 74.7 % Sales and Marketing We sell our workers’ compensation insurance through independent agencies (including retail and wholesale brokers and agents).
Percentage of Gross Premiums Written Year Ended December 31, State 2025 2024 2023 Florida 16.3 % 14.7 % 13.4 % Georgia 9.4 % 10.3 % 10.9 % Illinois 8.0 % 6.6 % 5.1 % Pennsylvania 7.3 % 7.2 % 7.6 % North Carolina 6.3 % 5.9 % 5.9 % Louisiana 5.8 % 6.0 % 7.5 % Wisconsin 3.7 % 3.8 % 4.3 % Virginia 3.7 % 3.7 % 3.7 % Alaska 3.2 % 3.4 % 3.0 % Minnesota 3.1 % 3.1 % 3.2 % South Carolina 3.0 % 3.0 % 3.3 % Texas 2.5 % 3.9 % 2.6 % Total 72.3 % 71.6 % 70.5 % Sales and Marketing We sell our workers’ compensation insurance through independent agencies (including retail and wholesale brokers and agents).
The final component of our reserves for loss and loss adjustment expenses is the reserve for mandatory pooling arrangements. The mandatory pooling arrangement reserve includes the amount reported to us by the pool administrators. In establishing reserves, we rely on the analysis of the approximate 240,000 claims in our 39-year history.
The final component of our reserves for loss and loss adjustment expenses is the reserve for mandatory pooling arrangements. The mandatory pooling arrangement reserve includes the amount reported to us by the pool administrators. In establishing reserves, we rely on the analysis of the more than 247,000 claims in our 40-year history.
Our underwriting and FSPs participate in both a long-term and a short-term incentive compensation programs that are paid quarterly. In addition, employee bonus programs in other areas of the Company help ensure our employees’ performance is appropriately rewarded when the Company performs well.
Our underwriting and safety departments participate in both a long-term and short-term incentive compensation programs that are paid quarterly. In addition, employee bonus opportunities in other areas of the Company are available to help ensure employee performance is appropriately rewarded when the Company performs well.
He previously served as Executive Vice President and Chief Technology Officer from January 2013 until February 2016, and Senior Vice President of Information Technology from September 2009 to January 2013. He has been employed with our Company since 2001. Kathryn H. Shirley has served as our Executive Vice President, Chief Administrative Officer and Secretary since February 2020.
Gagliano has served as our Chief Risk Officer since March 2016 and Executive Vice President since January 2013. He previously served as Chief Technology Officer from January 2013 until February 2016, and Senior Vice President of Information Technology from September 2009 to January 2013. He has been employed with our Company since 2001. Kathryn H.
According to the most recent market data reported by the NCCI, which is the official rating bureau in the majority of states in which we are licensed, total premiums reported for the specific occupational class codes for which we underwrite business were $19 billion. Policyholders As of December 31, 2024, we had more than 9,300 voluntary business policyholders.
According to the most recent market data reported by the NCCI, which is the official rating bureau in the majority of states in which we are licensed, total premiums reported for the specific occupational class codes for which we underwrite business were $18.4 billion. Policyholders As of December 31, 2025, we had more than 10,200 voluntary business policyholders.
In 2024, 92.5% of our new voluntary business policyholders were inspected prior to our offering a premium quote. 6 After the pre-quotation safety inspection has been completed, our underwriting professionals review the results of the inspection to determine if a quote should be made and, if so, prepare the quote.
In 2025, 93.4% of our new voluntary business policyholders were inspected prior to our offering a premium quote. 6 After the pre-quotation safety inspection has been completed, our underwriting professionals review the results of the inspection to determine if a quote should be offered and, if so, prepare the quote.
Dividend Limitations Under Nebraska law, without the prior approval of the Nebraska Director of Insurance, AIIC and SOCI cannot pay dividends to their shareholder that exceed the greater of (a) 10% of statutory surplus as of the previous year end or (b) statutory net income, excluding realized investment gains, for the preceding 12-month period.
We accrue for second injury funds relative to historical paid amounts. 21 Dividend Limitations Under Nebraska law, without the prior approval of the Nebraska Director of Insurance, AIIC and SOCI cannot pay dividends to their shareholder that exceed the greater of (a) 10% of statutory surplus as of the previous year end or (b) statutory net income, excluding realized investment gains, for the preceding 12-month period.
As of December 31, 2024, our best estimate of our ultimate liability for loss and loss adjustment expenses, net of amounts recoverable from reinsurers, was $538.6 million, which includes $13.0 million in reserves for mandatory pooling arrangements as reported by the pool administrators.
As of December 31, 2025, our best estimate of our ultimate liability for loss and loss adjustment expenses, net of amounts recoverable from reinsurers, was $507.5 million, which includes $13.7 million in reserves for mandatory pooling arrangements as reported by the pool administrators.
As of December 31, 2024, the carrying value of our investment portfolio, including cash and cash equivalents, was $832.8 million and the fair value of the portfolio was $819.5 million. Our board of directors has established an investment policy governing our investments, which is reviewed at least annually.
As of December 31, 2025, the carrying value of our investment portfolio, including cash and cash equivalents, was $796.8 million and the fair value of the portfolio was $791.3 million. Our board of directors has established an investment policy governing our investments, which is reviewed at least annually.
Resultant Change in Net Loss and DCC Reserve Change in Paid LDFs Change in Incurred LDFs Amount ($) Percentage (in thousands) 30% increase 30% increase 21,105 4.2 % 30% increase No change — (— )% 30% increase 30% decrease (20,780 ) (4.1 )% No change 30% increase 21,105 4.2 % No change 30% decrease (20,780 ) (4.1 )% 30% decrease 30% increase 21,105 4.2 % 30% decrease No change — (— )% 30% decrease 30% decrease (20,780 ) (4.1 )% For our paid and incurred weighted severity methods, we varied our year-end selected trend factor (for medical costs, defense costs, wage inflation, etc.) by an increase and decrease of 300 basis points.
Resultant Change in Net Loss and DCC Reserve Change in Paid LDFs Change in Incurred LDFs Amount ($) Percentage (in thousands) 30% increase 30% increase 24,360 5.1 % 30% increase No change — (— )% 30% increase 30% decrease (23,973 ) (5.1 )% No change 30% increase 24,360 5.1 % No change 30% decrease (23,973 ) (5.1 )% 30% decrease 30% increase 24,360 5.1 % 30% decrease No change — (— )% 30% decrease 30% decrease (23,973 ) (5.1 )% For our paid and incurred weighted severity methods, we varied our year-end selected trend factor (for medical costs, defense costs, wage inflation, etc.) by an increase and decrease of 300 basis points.
In addition to health care and 401k retirement programs, we offer wellness initiatives and time off for annual wellness exams, a floating holiday and leisure day, reimbursements of health club memberships, wellness luncheons, an annual health fair and confidential counseling services to promote a culture of wellness.
In addition to health care and 401k retirement programs, we offer wellness initiatives and time off for annual wellness exams, a floating holiday and leisure day, vacation accrual, paid holidays, reimbursements of health club memberships, wellness luncheons, an annual health fair and an employee assistance program with free confidential counseling services to promote a culture of wellness.
Workers’ compensation was the seventh-largest property and casualty insurance line in the U.S. in 2023, according to the National Council on Compensation Insurance, Inc. (the NCCI). Direct premiums written in 2023 for the workers’ compensation insurance industry were $58 billion, and direct premiums written for the property and casualty industry as a whole were $969 billion.
Workers’ compensation was the seventh-largest property and casualty insurance line in the U.S. in 2024, according to the National Council on Compensation Insurance, Inc. (the NCCI). Direct premiums written in 2024 for the workers’ compensation insurance industry were $57.6 billion, and direct premiums written for the property and casualty industry as a whole were $1.1 trillion.
As of December 31, 2024, our insurance was sold through more than 1,700 independent agencies and our wholly-owned insurance agency subsidiary, Amerisafe General Agency, which is licensed in 31 states. We are selective in establishing and maintaining relationships with independent agencies.
As of December 31, 2025, our insurance was sold through approximately 1,400 independent agencies and our wholly-owned insurance agency subsidiary, Amerisafe General Agency, which is licensed in 32 states. We are selective in establishing and maintaining relationships with independent agencies.
Best Rating Allied World Assurance Company Holdings, Ltd A Arch Reinsurance Company A+ Hannover Reinsurance Ireland Limited A+ Houston Casualty Company A++ Lloyd’s Syndicate 1414 ASC A Lloyd’s Syndicate 1955 ASL A Lloyd’s Syndicate 2987 BRT A Lloyd’s Syndicate 3000 MKL A Lloyd’s Syndicate 4472 LIB A Lloyd's Syndicate 0510 KLN A Lloyd's Syndicate 609 AUW A Lloyd's Syndicate 1084 CSL A Lloyd's Syndicate 1686 AXS A Lloyd's Syndicate 1880 TOK A Lloyd's Syndicate 1945 SII A Lloyd's Syndicate 1969 APL A Lloyd's Syndicate 2001 AML A Lloyd's Syndicate 2121 ARG A Lloyd's Syndicate 2988 BRT A Lloyd's Syndicate 4711 ASP A Markel Global Reinsurance Company A Minnesota Workers' Compensation Reinsurance Association NR MS Amlin AG A Munich Reinsurance America, Inc A+ State National Insurance Company A WCF National Insurance Company A Due to the nature of reinsurance, we have recoverables from reinsurers that apply to prior accident years.
A Houston Casualty Company A++ Lloyd's Syndicate 0609 AUW A+ Lloyd's Syndicate 1084 CSL A+ Lloyd’s Syndicate 1414 ASC A+ Lloyd's Syndicate 1686 AXS A+ Lloyd's Syndicate 1945 SII A+ Lloyd’s Syndicate 1955 ASL A+ Lloyd's Syndicate 1969 APL A+ Lloyd's Syndicate 2001 AML A+ Lloyd's Syndicate 2121 ARG A+ Lloyd’s Syndicate 2987 BRT A+ Lloyd's Syndicate 2988 BRT A+ Lloyd’s Syndicate 3000 MKL A+ Lloyd’s Syndicate 4472 LIB A+ Lloyd's Syndicate 4711 ASP A+ Markel Global Reinsurance Company A Minnesota Workers' Compensation Reinsurance Association NR MS Amlin AG A+ Munich Reinsurance America, Inc A+ State National Insurance Company A WCF National Insurance Company A Due to the nature of reinsurance, we have recoverables from reinsurers that apply to prior accident years.
We do not delegate underwriting authority to agencies, marketers or to any other third parties that sell our insurance. Comprehensive Safety Services. We provide proactive safety reviews of employers’ worksites, which are often located in rural areas.
We are highly disciplined when quoting and binding new and renewal business. We do not delegate underwriting authority to agencies, marketers or to any other third parties that sell our insurance. Comprehensive Safety Services. We provide proactive safety reviews of employers’ worksites, which are often located in rural areas.
For the twelve months ended December 31, 2024, the pre-tax investment yield of our investment portfolio was 3.4% per annum.
For the twelve months ended December 31, 2025, the average pre-tax net investment yield of our investment portfolio was 3.3% per annum.
Furthermore, certain states prohibit an insurer from withdrawing one or more lines of business from the state, except pursuant to a plan that is approved by the state insurance department. The state insurance department may disapprove a plan that may lead to market disruption.
For example, states may limit an insurer’s ability to cancel or not renew policies. Furthermore, certain states prohibit an insurer from withdrawing one or more lines of business from the state, except pursuant to a plan that is approved by the state insurance department. The state insurance department may disapprove a plan that may lead to market disruption.
Additional information regarding our reserve for unpaid loss and loss adjustment expenses (LAE) as of December 31, 2024, 2023, and 2022 is set forth below: 2024 2023 2022 (in thousands) Gross case loss and DCC reserves $ 523,695 $ 535,116 $ 559,570 AO reserves 20,299 19,117 17,589 Gross IBNR reserves 107,315 119,761 118,878 Gross unpaid loss, DCC and AO reserves 651,309 673,994 696,037 Reinsurance recoverables on unpaid loss and LAE (112,742 ) (119,746 ) (112,555 ) Net unpaid loss, DCC and AO reserves $ 538,567 $ 554,248 $ 583,482 10 We performed sensitivity analyses to show how our net loss and DCC expense reserve, including IBNR, would be impacted by changes in certain critical assumptions.
Additional information regarding our reserve for unpaid loss and loss adjustment expenses (LAE) as of December 31, 2025, 2024, and 2023 is set forth below: 2025 2024 2023 (in thousands) Gross case loss and DCC reserves $ 529,396 $ 523,695 $ 535,116 AO reserves 19,853 20,299 19,117 Gross IBNR reserves 64,334 107,315 119,761 Gross unpaid loss, DCC and AO reserves 613,583 651,309 673,994 Reinsurance recoverables on unpaid loss and LAE (106,075 ) (112,742 ) (119,746 ) Net unpaid loss, DCC and AO reserves $ 507,508 $ 538,567 $ 554,248 10 We performed sensitivity analyses to show how our net loss and DCC expense reserve, including IBNR, would be impacted by changes in certain critical assumptions.
The table below shows the carrying values of various categories of securities held in our investment portfolio, the percentage of the total carrying value of our investment portfolio represented by each category and the effective interest rate for the year ended December 31, 2024 based on the carrying value of each category as of December 31, 2024: Carrying Value Percentage of Portfolio Effective Interest Rate (in thousands) Fixed maturity securities—held-to-maturity: State and political subdivisions $ 368,026 44.2 % 2.3 % Corporate bonds 33,763 4.1 % 0.5 % U.S. agency-based mortgage-backed securities 2,781 0.3 % 1.6 % U.S.
The table below shows the carrying values of various categories of securities held in our investment portfolio, the percentage of the total carrying value of our investment portfolio represented by each category and the effective interest rate for the year ended December 31, 2025 based on the carrying value of each category as of December 31, 2025: Carrying Value Percentage of Portfolio Effective Interest Rate (in thousands) Fixed maturity securities—held-to-maturity: State and political subdivisions $ 322,407 40.5 % 3.4 % Corporate bonds 16,701 1.9 % 3.0 % U.S. agency-based mortgage-backed securities 2,403 0.3 % 4.1 % U.S.
These state agencies have broad regulatory, supervisory and administrative powers, including the power to grant and revoke licenses to transact business, license agencies, set the standards of solvency to be met and maintained, determine the nature of, and limitations on, investments and dividends, approve policy forms and rates in some states, periodically examine financial statements, determine the form and content of required financial statements and periodically examine market conduct.
These state agencies have broad regulatory, supervisory and administrative powers, including the power to grant and revoke licenses to transact business, license agencies, set the standards of solvency to be met and maintained, determine the nature of, and limitations on, investments and dividends, approve policy forms and rates in some states, periodically examine financial statements, determine the form and content of required financial statements and periodically examine market conduct. 20 Detailed annual and quarterly financial statements and other reports are required to be filed with the state insurance departments in all states in which we are licensed to transact business.
We are also subject to regulations related to the USL&H Act and the Jones Act. 22 The USL&H Act, which is administered by the U.S. Department of Labor, generally covers exposures on the navigable waters of the U.S. and in adjoining waterfront areas, including exposures resulting from stevedoring.
The USL&H Act, which is administered by the U.S. Department of Labor, generally covers exposures on the navigable waters of the U.S. and in adjoining waterfront areas, including exposures resulting from stevedoring.
The decrease in reserves was attributable primarily to favorable development from prior accident years. In 2024, we recognized $34.9 million of favorable development for prior accident years. As of December 31, 2023, we had 4,003 open claims, with an average of $168,372 in unpaid loss and loss adjustment expenses per open claim.
The decrease in reserves was attributable primarily to favorable development of $34.9 million from prior accident years. As of December 31, 2023, we had 4,003 open claims, with an average of $168,372 in unpaid loss and loss adjustment expenses per open claim. During the year ended December 31, 2023, 3,948 new claims were reported, and 4,220 claims were closed.
Resultant Change in Net Loss and DCC Reserve Change in Severity Trend Amount ($) Percentage (in thousands) 300 basis point increase 27,265 5.4 % 300 basis point decrease (23,509 ) (4.7 )% Reconciliation of Loss Reserves The table below shows the reconciliation of loss reserves on a gross and net basis for the years ended December 31, 2024, 2023 and 2022, reflecting changes in losses incurred and paid losses.
Resultant Change in Net Loss and DCC Reserve Change in Severity Trend Amount ($) Percentage (in thousands) 300 basis point increase 22,717 4.8 % 300 basis point decrease (19,599 ) (4.1 )% Reconciliation of Loss Reserves The table below shows the reconciliation of loss reserves on a gross and net basis for the years ended December 31, 2025, 2024 and 2023, reflecting changes in losses incurred and paid losses.
In a multi-claimant loss occurrence, the reinsurance coverage for any one individual claimant is limited to a maximum of $20.0 million, subject to applicable deductibles, retentions and aggregate limits. The first layer is a multi-year treaty that applies to losses incurred through December 31, 2025. The other layers are renewed annually.
In a multi-claimant loss occurrence, the reinsurance coverage for any one individual claimant is limited to a maximum of $20.0 million, subject to applicable deductibles, retentions and aggregate limits. Effective January 1, 2026, we renewed our excess of loss reinsurance treaty program. The first layer is a multi-year treaty that applies to losses incurred through December 31, 2028.
These safety reviews are a vital component of our underwriting process and also assist our policyholders in loss prevention, and encourage safer workplaces by deploying experienced field safety professionals (FSPs) to our policyholders’ worksites. In 2024, 92.5% of our new voluntary business policyholders had pre-quotation safety inspections. Additionally, we perform periodic on-site safety surveys for our voluntary business policyholders.
These safety reviews are a vital component of our underwriting process and also assist our policyholders in loss prevention, and encourage safer workplaces by deploying experienced field safety professionals (FSPs) to our policyholders’ worksites. In 2025, 93.4% of our new voluntary business policyholders had pre-quotation safety inspections.
(Chad) Cobb has served as our Senior Vice President, Safety Operations since October 2023. He has been employed with our Company since 2013 and served as Vice President, Field Safety from July 2019 to October 2023. Barbra E.
(Chad) Cobb has served as our Senior Vice President, Safety Operations since October 2023. He has been employed with our Company since 2013 and served as Vice President, Field Safety from July 2019 to October 2023. James R. (Ryan) Fletcher has served as our Senior Vice President, Risk Services since November 2025.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur articles of incorporation and bylaws contain the following provisions that could have an anti-takeover effect: • election of our directors is classified, meaning that the members of only one of three classes of our directors are elected each year; • shareholders have limited ability to call shareholder meetings and to bring business before a meeting of shareholders; • shareholders may not act by written consent, unless the consent is unanimous; and • our board of directors may authorize the issuance of preferred stock with such rights, preferences and privileges as our board of directors deems appropriate.
Biggest changeOur certificate of formation and bylaws and the laws of the state of Texas, our state of incorporation, contain the following provisions that could have an anti-takeover effect: • our board of directors is classified, meaning that the members of only one of three classes of our directors are elected each year; • directors may only be removed for cause and only by the affirmative vote of the holders of at least 66 2/3% of the Company's outstanding shares of common stock; • shareholders have limited ability to call shareholder meetings and to bring business or director nominations before a meeting of shareholders; • shareholders may not act by written consent, unless the consent is unanimous; • our board of directors may authorize the issuance of preferred stock with such rights, preferences and privileges as our board of directors deems appropriate; and • the affirmative vote of the holders of at least 66 2/3% of the Company's outstanding shares of common stock is required to amend our certificate of formation and our bylaws (if being amended by our shareholders).
We record reserves for estimated losses under insurance policies we write and for loss adjustment expenses related to the investigation and settlement of claims. Reserves are based on estimates of the most likely ultimate cost of individual claims.
We record reserves for estimated losses under insurance policies we write and for loss adjustment expenses related to the investigation and settlement of claims. Loss reserves are based on estimates of the most likely ultimate cost of individual claims.
Our reserves for loss and loss adjustment expenses represent the estimated cost of all reported and unreported loss and loss adjustment expenses incurred and unpaid at any given point in time based on known facts and circumstances. These estimates are inherently uncertain.
Our loss reserves for loss and loss adjustment expenses represent the estimated cost of all reported and unreported loss and loss adjustment expenses incurred and unpaid at any given point in time based on known facts and circumstances. These estimates are inherently uncertain.
Our business is dependent on the efforts of our executive officers because of their industry expertise, knowledge of our markets and relationships with the independent agencies that sell our insurance. Our success is dependent on the efforts of our executive officers because of their industry expertise, knowledge of our markets and relationships with our independent agencies.
Our business is dependent on our executive officers because of their industry expertise, knowledge of our markets and relationships with the independent agencies that sell our insurance. Our success is dependent on the efforts of our executive officers because of their industry expertise, knowledge of our markets and relationships with our independent agencies.
In order to set premium rates appropriately, we must: • collect and properly analyze a substantial volume of data; • develop, test and apply appropriate rating formulae; • closely monitor and timely recognize changes in trends; and • project both frequency and severity of losses with reasonable accuracy. 25 We must also implement our pricing accurately in accordance with our assumptions.
In order to set premium rates appropriately, we must: • collect and properly analyze a substantial volume of data; • develop, test and apply appropriate rating formulae; • closely monitor and timely recognize changes in trends; and • project both frequency and severity of losses with reasonable accuracy. We must also implement our pricing accurately in accordance with our assumptions.
These provisions may make it difficult for shareholders to replace management and could have the effect of discouraging a future takeover attempt that is not approved by our board of directors, but which individual shareholders might consider favorable. We are incorporated in Texas.
These provisions may make it difficult for our shareholders to replace management and could have the effect of discouraging a future takeover attempt that is not approved by our board of directors, but which our shareholders might consider favorable. We are incorporated in Texas.
For example, in order to enforce applicable laws and regulations or to protect policyholders, insurance regulatory agencies have relatively broad discretion to 28 impose a variety of sanctions, including examinations, corrective orders, suspension, revocation or denial of licenses, and the takeover of one or more of our insurance subsidiaries.
For example, in order to enforce applicable laws and regulations or to protect policyholders, insurance regulatory agencies have relatively broad discretion to impose a variety of sanctions, including examinations, corrective orders, suspension, revocation or denial of licenses, and the takeover of one or more of our insurance subsidiaries.
Our pre-tax income for any period is impacted by establishing reserves for new claims as well as changes in estimates for previously reported losses. Our focus on writing workers’ compensation insurance for employers engaged in hazardous industries results in our experiencing fewer, but more severe, claims.
Our pre-tax income for any period is impacted by establishing loss reserves for new claims as well as changes in estimates for previously reported losses. Our focus on writing workers’ compensation insurance for employers engaged in hazardous industries results in our experiencing fewer, but more severe, claims.
In some instances, these changes may not become apparent until after we have issued insurance policies that are affected by the changes. As a result, the full extent of our liability under an insurance policy may not be known until many years after the policy is issued.
In some instances, these changes may not become apparent until after we have issued insurance policies that are affected by the changes. As a result, the full extent of our potential liability under an insurance policy may not be known until many years after the policy is issued.
In any of these events, if our reinsurance broker is unable to reallocate the terminated reinsurance among the remaining reinsurers in the program, it could take a significant period of time to identify and negotiate agreements with one or more replacement reinsurers.
In any of these events, if our reinsurance broker is unable to reallocate the terminated reinsurance among the remaining reinsurers in the reinsurance treaty program, it could take a significant period of time to identify and negotiate agreements with one or more replacement reinsurers.
Securities analysts may discontinue coverage of our common stock or may issue negative reports, which may adversely affect the trading price of our common stock. There is no assurance that securities analysts will continue to cover us. If securities analysts do not cover us, this lack of coverage may adversely affect the trading price of our common stock.
Securities analysts may discontinue coverage of our common stock or may issue negative reports about us, which may adversely affect the trading price of our common stock. There is no assurance that securities analysts will continue to cover us. If securities analysts do not cover us, this lack of coverage may adversely affect the trading price of our common stock.
See “Business—Regulation” in Item 1 of this report. Accordingly, the assessments levied on us may increase as we increase our written premiums. Some states also have laws that establish second injury funds to reimburse insurers and employers for claims paid to injured employees for aggravation of prior conditions or injuries.
See “Business—Regulation” in Item 1 of this report, for further discussion. Accordingly, the assessments levied on us may increase as we increase our written premiums. Some states also have laws that establish second injury funds to reimburse insurers and employers for claims paid to injured employees for aggravation of prior conditions or injuries.
The interpretation of this historical data can be impacted by external forces, principally frequency and severity of unreported claims, length of time to achieve ultimate settlement of claims, inflation in medical costs and wages, insurance policy coverage interpretations, jury determinations, and legislative changes. Accordingly, our reserves may prove to be inadequate to cover our actual losses.
The interpretation of this historical data can be impacted by external forces, principally frequency and severity of unreported claims, length of time to achieve ultimate settlement of claims, inflation in medical costs and wages, insurance policy coverage interpretations, jury determinations, and legislative changes. 25 Accordingly, our loss reserves may prove to be inadequate to cover our actual losses.
The trading price of our common stock may decline for many reasons, some of which are beyond our control, including, among others: • our results of operations; • changes in expectations as to our future results of operations, including financial estimates and projections by securities analysts and investors; • results of operations that vary from those expected by securities analysts and investors; • developments in the insurance or healthcare industries; • current and expected economic conditions; • changes in laws and regulations; • announcements of claims against us by third parties; and • future issuances or sales of our common stock.
The trading price of our common stock may decline for many reasons, some of which may be beyond our control, including, among others: • our results of operations; • changes in expectations as to our future results of operations, including financial estimates and projections by securities analysts and investors; • results of operations that vary from those expected by securities analysts and investors; • developments in the insurance or healthcare industries or the industries of our policyholders; • current and expected economic conditions; • changes in laws and regulations; • announcements of claims against us by third parties; and • future issuances or sales of our common stock.
We are subject to extensive regulation by the Nebraska and Texas Departments of Insurance and the insurance regulatory agencies of other states in which we are licensed and, to a lesser extent, federal regulation. State agencies have broad regulatory powers designed primarily to protect policyholders and their employees, and not our shareholders.
We are subject to extensive regulation by the Nebraska and Texas Departments of Insurance, the insurance regulatory agencies of other states in which we are licensed to sell insurance and, to a lesser extent, the federal government. State agencies have broad regulatory powers designed primarily to protect policyholders and their employees, and not our shareholders.
Although the financial performance of an individual insurance company is dependent on its own specific business characteristics, the profitability of most workers’ compensation insurance companies generally tends to follow this cyclical market pattern.
Although the financial performance of an individual insurance company is dependent on its own specific business characteristics, the profitability of most workers’ compensation insurance companies, including AMERISAFE, generally tends to follow this cyclical market pattern.
Succession planning and employee education 32 and development for key positions is essential. If we are unable to attract and retain key employees and provide them with opportunities to learn and grow, our operations may be adversely impacted.
Succession planning and employee education and development for key positions are essential. If we are unable to attract and retain key employees and provide them with opportunities to learn and grow, our operations may be adversely impacted.
These funds are supported either by assessments or premium surcharges based on case incurred losses. In addition, as a condition to conducting business in some states, insurance companies are required to participate in residual market programs to provide insurance to those employers who cannot procure coverage from an insurance carrier on a negotiated basis.
These funds are supported either by assessments or premium surcharges based on case incurred losses. In addition, as a condition to conducting business in some states, insurance companies are required to participate in residual market programs to provide insurance to employers who cannot procure workers' compensation coverage from an insurance carrier on a negotiated basis.
Under Nebraska and Texas insurance law, advance approval by the state insurance department is required for any change of control of an insurer. “Control” is presumed to exist through the direct or indirect ownership of 10% or more of the voting securities of a domestic insurance company or any entity that controls a domestic insurance company.
Under Nebraska and Texas insurance law, advance approval by the state insurance department is required for any change of control of an insurer, including our insurance subsidiaries. “Control” is presumed to exist through the direct or indirect ownership of 10% or more of the voting securities of a domestic insurance company or any entity that controls a domestic insurance company.
When writing workers’ compensation insurance policies, we are required by law to provide workers’ compensation benefits for losses arising from acts of terrorism. The impact of any terrorist act is unpredictable, and the ultimate impact on us would depend upon the nature, extent, location and timing of such an act.
When writing workers’ compensation insurance policies, we are required by law to provide workers’ compensation coverage for losses arising from acts of terrorism. The impact of terrorist acts is unpredictable, and the ultimate impact of such acts on us would depend upon the nature, extent, location and timing of such an act.
We have entered into employment agreements with each of our executive officers. Should any of our executive officers cease working for us, we may be unable to find acceptable replacements with comparable skills and experience in the workers’ compensation insurance industry and the hazardous industries that we target.
We have entered into employment agreements with each of our executive officers. If and when any of our executive officers cease working for us, we may be unable to find acceptable replacements with comparable skills and experience in the workers’ compensation insurance industry and the hazardous industries that we target.
In addition to the ability of our operating subsidiaries to pay dividends to us, the timing and amount of dividends, and any share repurchases is at the discretion of our board of directors and management, respectively.
In addition to the ability of our insurance subsidiaries to pay dividends to us, the timing and amount of dividends, and any share repurchases is at the discretion of our board of directors and management, respectively.
Any significant decline in our investment income would adversely affect our revenues and net income. 26 A decline in the level of business activity of our policyholders, particularly those engaged in the construction, trucking, logging and lumber, agriculture, manufacturing, maritime, and telecommunications industries, could negatively affect our earnings and profitability.
Any significant decline in our investment income would adversely affect our revenues and net income. A decline in the level of business activity of our policyholders, particularly those engaged in the construction, trucking, logging and lumber, agriculture, services, manufacturing, and maritime industries, could negatively affect our earnings and profitability.
However, these options may result in losses to our Company, and there can be no assurance that we could implement any of these options. If any of our current reinsurers were to terminate participation in our reinsurance treaty program, we could be exposed to an increased risk of loss.
However, these options may result in us incurring losses, and there can be no assurance that we could implement any of these options. If any of our current reinsurers were to terminate participation in our reinsurance treaty program, we could be exposed to an increased risk of loss.
Increased federal involvement has the potential to change the workers’ compensation structure impacting workers’ benefits and the method of administration. As a result, potential changes in the level of federal oversight of the workers’ compensation industry could adversely affect our operations.
Increased federal involvement has the potential to change the workers’ compensation structure, which could impact workers’ benefits and the method of workers' compensation administration. As a result, changes in the level of federal oversight of the workers’ compensation industry could adversely affect our operations.
Although we price our insurance to account for obligations we may have under these pooling arrangements, we may not be successful in estimating our liability for these obligations. Accordingly, mandatory pooling arrangements may cause a decrease in our profits. At December 31, 2024, we participated in mandatory pooling arrangements in 26 states and the District of Columbia.
Although we price our insurance to account for obligations we may have under these pooling arrangements, we may not be successful in estimating our liability for these obligations. Accordingly, mandatory pooling arrangements may cause a decrease in our profits. At December 31, 2025, we participated in mandatory pooling arrangements in 25 states and the District of Columbia.
Notwithstanding the protection provided by reinsurance and the Terrorism Risk Insurance Program Reauthorization Act of 2019, the risk of severe losses to us from acts of terrorism has not been eliminated because our reinsurance treaty program includes various sub-limits and exclusions limiting our reinsurers’ obligation to cover losses caused by acts of terrorism.
Notwithstanding the protection provided to us by reinsurance and the Terrorism Risk Insurance Program Reauthorization Act of 2019, the risk of us incurring severe losses from acts of terrorism is not eliminated because our reinsurance treaty program includes various sub-limits and exclusions limiting our reinsurers’ obligation to cover our losses caused by acts of terrorism.
Under the Texas Business Organizations Code, our ability to enter into a business combination with an affiliated shareholder is limited. In addition, two of our three insurance company subsidiaries, AIIC and SOCI, are incorporated in Nebraska and the other, AIICTX, is incorporated in Texas.
Under the Texas Business Organizations Code (TBOC), our ability to enter into a business combination (as defined in the TBOC) with an affiliated shareholder (as defined in the TBOC) is limited. 31 In addition, two of our three insurance company subsidiaries, AIIC and SOCI, are incorporated in Nebraska and the other, AIICTX, is incorporated in Texas.
We market a substantial portion of our workers’ compensation insurance through independent agencies. As of December 31, 2024, independent agencies produced 98.4% of our voluntary in-force premiums. No independent agency accounted for more than 2.0% of our voluntary in-force premiums at that date. Independent agencies are not obligated to promote our insurance and may sell insurance offered by our competitors.
We market a substantial portion of our workers’ compensation insurance through independent agencies. As of December 31, 2025, independent agencies produced 99.0% of our voluntary in-force premiums. No independent agency accounted for more than 2.0% of our voluntary in-force premiums at that date. Independent agencies are not obligated to promote our insurance and may sell insurance offered by our competitors.
Accordingly, events constituting acts of terrorism may not be covered by, or may exceed the capacity of, our reinsurance and could adversely affect our business and financial condition. 29 Risks Related to Our Reinsurers If we are unable to obtain reinsurance on favorable terms, our ability to write policies could be adversely affected.
Accordingly, events constituting acts of terrorism may not be covered by, or may exceed the limits of, our reinsurance treaty program and could adversely affect our business and financial condition. Risks Related to Our Reinsurers If we are unable to obtain reinsurance on favorable terms, our ability to write policies could be adversely affected.
Provisions of our articles of incorporation and bylaws and the laws of the states of Texas and Nebraska could impede an attempt to replace or remove our directors or otherwise effect a change of control of our Company, which could diminish the value of our common stock.
Provisions of our certificate of formation and bylaws and the laws of the states of Texas and Nebraska could impede an attempt to replace or remove our directors or otherwise effect a change of control of our Company, which could diminish the value of our common stock.
Our articles of incorporation and bylaws contain provisions that may make it more difficult for shareholders to replace or remove directors even if the shareholders consider it beneficial to do so. In addition, these provisions could delay or prevent a change of control of our Company that shareholders might consider favorable.
Our certificate of formation and bylaws contain provisions that may make it more difficult for shareholders to replace or remove directors even if our shareholders consider it beneficial to do so. In addition, these provisions could delay or prevent a change of control of our Company that shareholders might consider favorable.
Our ability to undertake these efforts successfully, and as a result set premium rates accurately, is subject to a number of risks and uncertainties, principally: • insufficient reliable data; • incorrect or incomplete analysis of available data; • uncertainties generally inherent in estimates and assumptions; • the complexity inherent in implementing appropriate rating formulae or other pricing methodologies; • increase of costs of ongoing medical treatment; • uncertainties inherent in accurately estimating retention, investment yields, and the duration of our liability for loss and loss adjustment expenses; and • unanticipated court decisions, legislation or regulatory action.
Our ability to undertake these efforts successfully, and as a result set premium rates accurately, is subject to a number of risks and uncertainties, principally: • insufficient reliable data; • incorrect or incomplete analysis of available data; • uncertainties generally inherent in estimates and assumptions; • the complexity inherent in implementing appropriate rating formulae or other pricing methodologies; • increase of costs of ongoing medical treatment, including the impact of medical advances on the cost and duration of bodily injury claims; 24 • uncertainties inherent in accurately estimating retention, investment yields, and the duration of our liability for loss and loss adjustment expenses; and • unanticipated court decisions, legislation or regulatory action.
As we write policies in new states that have mandatory pooling arrangements, we will be required to participate in additional pooling arrangements. Further, the impairment, insolvency or failure of other insurance companies in these pooling arrangements would likely increase the liability for other members in the pool.
If we write policies in new states that have mandatory pooling arrangements, we would be required to participate in additional pooling arrangements. Further, the impairment, insolvency or failure of other insurance companies in these pooling arrangements would likely increase the liability for other members in the pool, including us.
We currently have 26 reinsurers participating in our reinsurance treaty program, and we believe that this is a sufficient number of reinsurers to provide us with the reinsurance coverage we require. However, it is possible that one or more of our current reinsurers could terminate participation in our program.
We currently have 24 reinsurers participating in our reinsurance treaty program, which we believe is a sufficient number of reinsurers to provide us with the reinsurance coverage we require. However, it is possible that one or more of our current reinsurers could terminate participation in our program.
Our profitability can be affected significantly by: • rising levels of claims costs, including medical and prescription drug costs, that we cannot anticipate at the time we establish our premium rates; • fluctuations in interest rates, inflationary or deflationary pressures and other changes in the investment environment that affect returns on our invested assets; • changes in the frequency or severity of claims; • the financial stability of our reinsurers and changes in the level of reinsurance capacity and our capital capacity; • new types of claims and new or changing judicial interpretations relating to the scope of liabilities of insurance companies; • volatile and unpredictable developments impacting general economic conditions and the businesses of our policyholders, including man-made, weather-related and other natural catastrophes or terrorist attacks; and • price competition.
Our revenues and results of operations can be affected significantly by: • rising levels of claims costs, including due to increased medical and prescription drug costs, that we cannot anticipate at the time we establish our premium rates; • fluctuations in interest rates, inflationary or deflationary pressures and other changes in the investment environment that affect returns on our invested assets; • changes in the frequency or severity of claims; • the financial stability of our reinsurers and changes in the level of reinsurance capacity and our capital capacity; • new types of claims and new or changing judicial interpretations relating to the scope of liabilities of insurance companies; • volatile and unpredictable developments impacting general economic conditions and the businesses of our policyholders, including man-made, weather-related and other natural catastrophes or terrorist attacks; and • price competition; and • other factors described elsewhere in this "Risk Factors" section.
Our 2025 reinsurance treaty program affords limited coverage for up to $100.0 million for losses arising from terrorism, subject to applicable deductibles, retentions, definitions and aggregate limits.
Our 2026 reinsurance treaty program affords limited coverage up to $100.0 million for losses arising from terrorism, subject to applicable deductibles, exclusions, retentions, and aggregate limits.
Increased interest rates could have an adverse effect on the market value of our investment portfolio. Decreased interest rates could have an adverse effect on our investment income, in addition to increased prepayment risk on callable securities included in our investment portfolio.
Decreased interest rates could have an adverse effect on our investment income, in addition to increased prepayment risk on callable securities included in our investment portfolio.
As a result, we may not be able to receive dividends from our insurance subsidiaries or may not receive dividends in amounts necessary to pay dividends on our capital stock or repurchase shares.
As a result, we may not be able to receive dividends from our insurance subsidiaries or may not receive dividends in amounts necessary to pay dividends to our shareholders or repurchase shares.
In 2024, 85.4% of our gross premiums written were derived from policyholders in the construction, trucking, logging and lumber, agriculture, manufacturing, maritime, and telecommunications industries. Because premium rates are calculated, in general, as a percentage of a policyholder’s payroll expense, premiums fluctuate depending upon the level of business activity and number of employees of our policyholders.
In 2025, 89.6% of our gross premiums written were derived from policyholders in the construction, trucking, logging and lumber, agriculture, services, manufacturing, and maritime industries. Because premium rates are calculated, in general, as a percentage of a policyholder’s payroll expense, premiums fluctuate depending upon the level of business activity and number of employees of our policyholders.
The extensive regulation of our business may increase our costs and may limit our ability to obtain premium rate increases or to take other actions to increase our profitability. The workers’ compensation system is largely regulated by state regulation. However in recent years, certain federal agencies and regulatory bodies have increased interest in more federal workers’ compensation oversight.
The extensive regulation of our business may increase our costs and may limit our ability to increase our premium rates or take other actions to increase our profitability. The workers’ compensation system is largely regulated by state governments. However, in the past, certain federal agencies and regulatory bodies have increased interest in more federal workers’ compensation oversight.
Regulations vary from state to state, but typically address: • standards of solvency, including risk-based capital measurements; • restrictions on the nature, quality and concentration of our investments; • restrictions on the terms of the insurance policies we offer; • restrictions on the way our premium rates are established and the premium rates we may charge; • required reserves for unearned premiums and loss and loss adjustment expenses; • standards for appointing general agencies; • limitations on transactions with affiliates; • restrictions on mergers and acquisitions; • restrictions on the ability of our insurance company subsidiaries to pay dividends to AMERISAFE; • certain required methods of accounting; and • potential assessments for state guaranty funds, second injury funds and other mandatory pooling arrangements.
Regulations vary from state to state, but typically address: • standards of solvency, including risk-based capital measurements; • restrictions on the nature, quality and concentration of our investments; • restrictions on the terms of the insurance policies we offer; • restrictions on the way our premium rates are established and the premium rates we may charge; • required reserves for unearned premiums and loss and loss adjustment expenses; • standards for appointing general agencies; • limitations on transactions with affiliates; • restrictions on mergers and acquisitions; 28 • restrictions on the ability of our insurance company subsidiaries to pay dividends to AMERISAFE; • certain required methods of accounting; • potential assessments for state guaranty funds, second injury funds and other mandatory pooling arrangements; • applicable privacy laws, including the protection of non-public personal information and personally identifiable information , including health information; and • cybersecurity, privacy and artificial intelligence laws and regulations.
We may need to raise additional capital or curtail our growth if the capital of our insurance subsidiaries is insufficient to support future operating requirements and/or cover claims. If we had to raise additional capital, equity or debt financing might not be available to us or might be available only on terms that are unfavorable to us.
We may need to raise additional capital or curtail our growth if the capital of our insurance subsidiaries is insufficient to support future operating requirements and/or cover claims. If we are required to raise additional capital, equity or debt financing might not be available to us on favorable terms, or at all.
Our future capital requirements will depend on many factors, including state regulatory requirements, the financial stability of our reinsurers and our ability to write new business and establish premium rates sufficient to cover our estimated claims.
Our future capital requirements will depend on many factors, including, among other things, state regulatory requirements, the financial stability of our reinsurers, our ability to write new business and establish premium rates sufficient to cover our estimated claims and changes to our business strategy (including initiatives to expand our business).
As a result, our continued profitability depends, in part, on the marketing efforts of our independent agencies and on our ability to offer workers’ compensation insurance and maintain financial strength ratings that meet the requirements of our independent agencies and their policyholders.
As a result, our continued profitability depends, in part, on the marketing efforts of our independent agencies and on our ability to offer workers’ compensation insurance and maintain financial strength ratings that meet the requirements of our independent agencies and their policyholders. The effects of emerging claims and coverage issues on our business are uncertain.
Rating agencies evaluate insurance companies based on their ability to pay claims. We are currently assigned a group letter rating of “A” (Excellent) from A.M. Best, which is the rating agency that we believe has the most influence on our business. This rating is assigned to companies that, in the opinion of A.M.
Best rating would likely reduce the amount of business we are able to write. Rating agencies evaluate insurance companies based on their ability to pay claims. We are currently assigned a group letter rating of “A” (Excellent) from A.M. Best, which is the rating agency that we believe has the most influence on our business.
During this period, we would be exposed to an increased risk of loss, the extent of which would depend on the coverage previously provided by the terminated reinsurance. We may not be able to recover amounts due from our reinsurers, which would adversely affect our financial condition. Reinsurance does not discharge our obligations under the insurance policies we write.
During this period, we would be exposed to an increased risk of loss, the extent of which would depend on the coverage previously provided by the terminated reinsurer. We may not be able to recover amounts due from our reinsurers, which would adversely affect our financial condition.
We caution readers that forward-looking statements are not guarantees of future performance and actual results may differ materially from those anticipated, expected, projected or assumed in the forward-looking statements.
We caution readers that forward-looking statements are not guarantees of future performance and actual results may differ materially from those anticipated, expected, projected or assumed in the forward-looking statements. Important factors that can cause our actual results to differ materially from those anticipated in the forward-looking statements are included below.
As a result, insurance regulatory agencies could preclude us from conducting some or all of our activities or otherwise penalize us.
Our practices may be different from interpretations of insurance regulatory agencies, and as a result, insurance regulatory agencies could preclude us from conducting some or all of our activities or otherwise penalize us.
For example, medical costs associated with permanent and partial disabilities may increase more rapidly or be higher than we currently expect. Changes of this nature may expose us to higher claims costs than we anticipated when we wrote the underlying policy.
For example, medical costs associated with permanent and partial disabilities may increase more rapidly or may be higher than we expect at the time we issue a policy. Changes of this nature may expose us to higher claims costs than we anticipated when we issued the underlying policy. A downgrade in our A.M.
If there are unfavorable changes affecting our assumptions, our reserves may need to be increased. When a reserve estimate is increased, the change decreases pre-tax income by a corresponding amount. The effects of emerging claims and coverage issues on our business are uncertain.
If there are unfavorable changes affecting our assumptions, our loss reserves may need to be increased. When a loss reserve estimate is increased, the change decreases pre-tax income by a corresponding amount.
We may be unable to comply fully with the wide variety of applicable laws and regulations that are periodically undergoing revision. In addition, we follow practices based on our interpretations of laws and regulations that we believe are generally followed by our industry. These practices may be different from interpretations of insurance regulatory agencies.
We may be unable to comply fully with the wide variety of laws and regulations applicable to us and our business which periodically undergo revisions. In addition, we follow practices based on our interpretations of laws and regulations that we believe are generally followed by our industry.
We remain liable to our policyholders even if we are unable to make recoveries that we are entitled to receive under our reinsurance contracts. As a result, we are subject to credit risk with respect to our reinsurers. Losses are recovered from our reinsurers as claims are paid.
Reinsurance does not discharge our obligations under the insurance policies we issue to our policyholders. We remain liable to our policyholders even if we are unable to make recoveries from our reinsurers that we are entitled to receive under our reinsurance contracts. As a result, we are subject to credit risk with respect to our reinsurers.
Although we have experienced no known cases involving unauthorized access to our information technology systems and data or unauthorized appropriation of such data to date, we have no assurance that such technology breaches will not occur in the future.
Despite these safeguards, disruptions to and breaches of our information technology systems or those of our providers’ are possible and may negatively impact our business. 27 Although we have experienced no known material cases involving unauthorized access to our information technology systems and data or unauthorized appropriation of such data to date, we have no assurance that such technology breaches will not occur in the future.
If we cannot obtain adequate capital on favorable terms or at all, we may be unable to support future growth or operating requirements and, as a result, our business, financial condition or results of operations could be adversely affected.
If we cannot obtain adequate capital on favorable terms or at all, we may be unable to support future growth or operating requirements and, as a result, our business, financial condition or results of operations could be adversely affected. Strategic and Operational Risks The workers’ compensation insurance industry is cyclical in nature, which may affect our overall financial performance.
Obtaining these approvals may result in the material delay of, or deter, any transaction that would result in a change of control. 31 The trading price of our common stock may decline.
Obtaining these approvals may result in the material delay of, or deter, any transaction that would result in a change of control under applicable laws. See “Business—Regulation—Change of Control” in Item 1 of this report. The trading price of our common stock may decline.
Like all companies, our information technology systems are vulnerable to data breaches, interruptions or failures due to events that may be beyond our control, including natural disasters, theft, terrorist attacks, computer viruses, hackers and general technology failures.
Furthermore, a significant portion of the communications between our employees, our policyholders and service providers depend on information technology and electronic information exchange. Like all companies, our information technology systems are vulnerable to data breaches, interruptions or failures due to events that may be beyond our control, including natural disasters, theft, terrorist attacks, computer viruses, hackers and general technology failures.
We are a holding company that transacts business through our operating subsidiaries, including AIIC. Our primary assets are the capital stock of these operating subsidiaries. Our ability to pay dividends to our shareholders and repurchase shares depends upon the surplus and earnings of our subsidiaries and their ability to pay dividends to us.
Our primary assets are the capital stock of these insurance subsidiaries. Our ability to pay dividends to our shareholders and repurchase shares depends upon the surplus and earnings of our insurance subsidiaries and their ability to pay dividends to us.
Establishing adequate rates is necessary to generate sufficient revenue to offset losses, loss adjustment expenses and other underwriting expenses, and to earn an underwriting profit. If we fail to accurately assess the risks, we may fail to charge adequate premium rates to cover our losses and expenses, which could reduce our net income and cause us to become unprofitable.
If we fail to accurately assess the risks, we may fail to charge adequate premium rates to cover our losses and expenses, which could reduce our net income and cause us to become unprofitable.
The availability, amount and cost of reinsurance are subject to market conditions and our experience with insured losses. As a result, any material changes in market conditions or our loss experience could adversely affect our financial performance. A downgrade in the A.M. Best rating of one or more of our significant reinsurers could adversely affect our financial condition.
As a result, any material changes in market conditions or our loss experience could adversely affect our ability to obtain reinsurance on favorable terms, or at all, which could adversely affect our financial performance. A downgrade in the A.M. Best rating of one or more of our significant reinsurers could adversely affect our financial condition.
We only offer workers’ compensation insurance, and we have no current plans to focus our efforts on offering other types of insurance. As a result, negative developments in the economic, competitive or regulatory conditions affecting the workers’ compensation insurance industry could have an adverse effect on our financial condition and results of operations.
As a result, negative developments in the economic, competitive or regulatory conditions affecting the workers’ compensation insurance industry are likely to have a disproportionately adverse effect on our financial condition and results of operations.
Consequently, we could set our premium rates too low, which could negatively affect our results of operations and our profitability, or we could set our premium rates too high, which could reduce our competitiveness and lead to lower revenues. If we cannot sustain our relationships with independent agencies, we may be unable to operate profitably.
Consequently, we could set our premium rates too low, which could negatively affect our results of operations and our profitability, or we could set our premium rates too high, which could reduce our competitiveness and lead to lower revenues. If we are unable to realize our investment objectives, our financial condition and results of operations may be adversely affected.
Our 2025 reinsurance program provides us with reinsurance coverage for each loss occurrence up to $100.0 million, subject to applicable limitations, deductibles, retentions and aggregate limits. Our retention is $2.0 million for each loss occurrence. Losses in the layer between $2.0 million and $10.0 million are ceded to a multi-year reinsurance treaty.
Our 2026 reinsurance treaty program provides us with reinsurance coverage for each loss occurrence up to $100.0 million, subject to applicable limitations, deductibles, retentions and aggregate limits. Our retention is $2.0 million for each loss occurrence. The availability, amount and cost of reinsurance are subject to market conditions and our experience with insured losses.
A significant adverse result, or multiple adverse results involving similar issues, could require us to pay significant amounts or change the manner in which we administer claims, which could have a material adverse effect on our operations or results of operations. We may have exposure to losses from terrorism for which we are required by law to provide coverage.
The outcome of any legal proceedings is inherently uncertain and a significant adverse result, or multiple adverse results involving similar issues, could require us to pay significant amounts or change the manner in which we administer claims, which could have a material adverse effect on our operations or results of operations.
General economic conditions may be adversely affected by many things out of our control, including global health pandemics, U.S. involvement in hostilities with other countries and large-scale acts of terrorism, or the threat of hostilities or terrorist acts. Interest rates are highly sensitive to many factors, including governmental monetary policies and domestic and international economic and political conditions.
General economic and political conditions may be adversely affected by many things out of our control, including inflation, interest rates, trade and tax policy (including tariffs), strength of the U.S. dollar, global health pandemics, U.S. involvement in political or geopolitical tensions and conflicts, and large-scale acts of terrorism, or the threat of hostilities or terrorist acts.
Because this market cyclicality is due in large part to the actions of our competitors and general economic factors, we cannot predict the timing or duration of changes in the market cycle. We expect these cyclical patterns will cause our revenues and net income to fluctuate, which may cause the price of our common stock to be more volatile.
Because this market cyclicality is due in large part to the actions of our competitors and general economic factors, we cannot predict the timing or duration of changes in the market cycle.
For the year ended December 31, 2024, we had $29.2 million of net investment income. Our investment portfolio is managed under investment guidelines approved by our board of directors and is made up predominately of fixed maturity securities and cash and cash equivalents.
Our investment portfolio is managed under investment guidelines approved by our board of directors and is made up predominately of fixed maturity securities and cash and cash equivalents.
No assurance can be given that we will maintain our current competitive position in the markets in which we currently operate or that we will establish a competitive position in new markets into which we may enter. If we do not appropriately establish our premium rates, our results of operations will be adversely affected.
No assurance can be given that we will maintain our current competitive position in the markets in which we currently operate or that we will establish a competitive position in new markets into which we may enter. If we cannot sustain our relationships with independent agencies, we may be unable to operate profitably.
Important factors that can cause our actual results to differ materially from those anticipated in the forward-looking statements are included below. 24 The occurrence of one or more of the risks discussed below could significantly and adversely affect our business, prospects, financial condition, results of operations and cash flows and you could lose part or all of your investment.
See "Cautionary Statement Regarding Forward-Looking Statements" at the beginning of this annual report. The occurrence of one or more of the risks discussed below could significantly and adversely affect our business, prospects, financial condition, results of operations and cash flows and you could lose part or all of your investment.
Our dividend payments and share repurchases may change, and there can be no assurance that we will continue to declare dividends or repurchase shares at all or in any particular amounts. A downgrade in our A.M. Best rating would likely reduce the amount of business we are able to write.
Our dividend payments and share repurchases may change, and there can be no assurance that we will continue to declare dividends or repurchase shares at all or in any particular amounts. We may require additional capital in the future, which may not be available to us or may be available only on unfavorable terms.
Negative developments in the workers’ compensation insurance industry could have a greater impact on our Company because we do not sell other types of insurance. We compete on the basis of many factors, including coverage availability, claims management, safety services, payment terms, premium rates, policy terms, types of insurance offered, overall financial strength, financial ratings and reputation.
We compete on the basis of many factors, including coverage availability, claims management, safety services, payment terms, premium rates, policy terms, types of insurance offered, overall financial strength, financial ratings and reputation. If any of our competitors are more competitive on any of these factors than us, we could lose market share.
In long-term workers’ compensation claims, the creditworthiness of our reinsurers may change before we recover amounts to which we are entitled. Therefore, if a reinsurer is unable to meet any of its obligations to us, we would be responsible for all claims and claim settlement expenses for which we would have otherwise received payment from the reinsurer.
Therefore, if a reinsurer is unable to meet any of its obligations to us, we would be responsible for all claims and claim settlement expenses for which we would have otherwise received payment from the reinsurer. As of December 31, 2025, we had $108.1 million of recoverables from reinsurers. Of this amount, $44.2 million was unsecured.
We rely on information technology systems to process, transmit, store and protect the electronic information, financial data and proprietary models that are critical to our business. Furthermore, a significant portion of the communications between our employees, our policyholders and service providers depend on information technology and electronic information exchange.
Technology breaches or failures, including those resulting from a malicious cyber attack on us, our policyholders, or service providers, could disrupt or otherwise negatively impact our business. We rely on information technology systems to process, transmit, store and protect the electronic information, financial data and proprietary models that are critical to our business.
In general, the premium rates for our insurance policies are established when coverage is initiated and, therefore, before all of the underlying costs are known. Like other workers’ compensation insurance companies, we rely on estimates and assumptions in setting our premium rates.
Financial Risks If we do not appropriately establish our premium rates, our results of operations will be adversely affected. In general, the premium rates for our insurance policies are established when coverage is initiated and, therefore, before all of the underlying costs are known.
We operate in a highly competitive industry and may lack the financial resources to compete effectively. There is significant competition in the workers’ compensation insurance industry. We believe that our competition in the hazardous industries we target is fragmented and not dominated by one or more competitors. We compete with other insurance companies, state insurance pools and self-insurance funds.
We believe that our competition in the hazardous industries we target is fragmented and not dominated by one or more competitors. Instead, we compete with various insurance companies, state insurance pools and self-insurance funds. Many of our existing and potential competitors are, or may be, 26 significantly larger and may possess greater financial, marketing and management resources than we do.
If we are unable to realize our investment objectives, our financial condition and results of operations may be adversely affected. Investment income is an important component of our net income. As of December 31, 2024, our investment portfolio, including cash and cash equivalents, had a carrying value of $832.8 million.
Investment income is an important component of our net income. As of December 31, 2025, our investment portfolio, including cash and cash equivalents, had a carrying value of $796.8 million. For the year ended December 31, 2025, we had $27.0 million of net investment income.
Best ratings are directed toward the concerns of policyholders and insurance agencies and are not intended for the protection of investors or as a recommendation to buy, hold or sell securities. Our competitive position relative to other companies is determined in part by our A.M. Best rating.
Best are subject to periodic review using, among other things, proprietary capital adequacy models, and are subject to revision or withdrawal at any time. A.M. Best ratings are directed toward the concerns of policyholders and insurance agencies and are not intended for the protection of our shareholders or to serve as a recommendation to buy, hold or sell our securities.
If we are unable to collect amounts recoverable from our reinsurers, our financial condition could be adversely impacted. 30 Risks Related to Our Common Stock Our revenues and results of operations may fluctuate as a result of factors beyond our control, which fluctuation may cause the price of our common stock to be volatile.
Risks Related to Our Common Stock Our revenues and results of operations may fluctuate as a result of factors beyond our control, which may cause the price of our common stock to be volatile. Our revenues and results of operations historically have been subject to significant fluctuations and uncertainties, some of which may be out of our control.
Many of our existing and potential competitors are significantly larger and possess greater financial, marketing and management resources than we do. Moreover, a number of these competitors offer other types of insurance in addition to workers’ compensation and can provide insurance nationwide.
Moreover, a number of these competitors offer other types of insurance in addition to workers’ compensation and can provide insurance nationwide. We only offer workers’ compensation insurance, and we currently have no plans to focus our efforts on offering other types of insurance.
Best, have demonstrated an excellent overall performance when compared to industry standards. A.M. Best considers “A” rated companies to have an excellent ability to meet their ongoing obligations to policyholders. The ratings of A.M. Best are subject to periodic review using, among other things, proprietary capital adequacy models, and are subject to revision or withdrawal at any time. A.M.
This rating is assigned to companies that, in the opinion of A.M. Best, have demonstrated an excellent overall performance when compared to industry standards, and have an excellent ability to meet their ongoing obligations to their policyholders. The ratings of A.M.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeOur ability to pay dividends in the future depends on, among other things, the ability of our operating subsidiaries to pay dividends to us. Our insurance company subsidiaries are regulated insurance companies and therefore are subject to significant regulatory restrictions limiting their ability to declare and pay dividends. See “Business—Regulation—Dividend Limitations” in Item 1 of this report.
Biggest changeOur insurance company subsidiaries are regulated insurance companies and therefore are subject to significant regulatory restrictions limiting their ability to declare and pay dividends. See “Business—Regulation—Dividend Limitations” in Item 1 and Item 1A. "Risk Factors" of this report. Our existing revolving credit agreement contains covenants that limit our ability to pay dividends on our common stock.
Market Information and Holders Our common stock is traded on the NASDAQ Global Select Market under the symbol “AMSF.” As of February 14, 2025, there were 20 holders of record of our common stock which does not include beneficial holders whose shares are held by banks, brokers, and other financial institutions.
Market Information and Holders Our common stock is traded on the NASDAQ Global Select Market under the symbol “AMSF.” As of February 13, 2026, there were 19 holders of record of our common stock which does not include beneficial holders whose shares are held by banks, brokers, and other financial institutions.
Dividend Policy In 2024, 2023 and 2022, the Company paid regular quarterly cash dividends of $0.37, $0.34, and $0.31 per share, respectively. In addition, the Company paid extraordinary cash dividends of $3.00 in 2024, $3.50 in 2023 and $4.00 in 2022.
Dividend Policy In 2025, 2024 and 2023, the Company paid regular quarterly cash dividends of $0.39, $0.37, and $0.34 per share, respectively. In addition, the Company paid special cash dividends of $1.00, $3.00, and $3.50 per share in 2025, 2024 and 2023, respectively.
On February 25, 2025 the Company declared a regular quarterly cash dividend of $0.39 per share payable on March 21, 2025 to shareholders of record as of March 7, 2025. The Board intends to continue to consider the payment of a regular cash dividend each calendar quarter.
On February 24, 2026 the Company declared a regular quarterly cash dividend of $0.41 per share payable on March 20, 2026 to shareholders of record as of March 13, 2026. The Company's board of directors intends to continue to consider the payment of a regular cash dividend each calendar quarter.
It is anticipated that any future repurchases will be funded from available capital. 35 The following table summarizes the Company’s purchases of its common stock, par value $0.01 per share, during the three months ended December 31, 2024: Period Total Number of Shares Purchased Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Program Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (in thousands) October 1, 2024 to October 31, 2024 — $ — — $ 5,318 November 1, 2024 to November 30, 2024 — — — 5,318 December 1, 2024 to December 31, 2024 — — — 5,318 Total — — (1) Average price paid per share includes commissions and excise tax .
The board of directors’ determination will depend on a variety of factors, including, but not limited to, market conditions and applicable regulatory considerations. 34 The following table summarizes the Company’s purchases of its common stock, par value $0.01 per share, during the three months ended December 31, 2025: Period Total Number of Shares Purchased Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Program Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (2) (in thousands) October 1, 2025 to October 31, 2025 94,274 $ 41.58 94,274 $ 20,960 November 1, 2025 to November 30, 2025 24,745 40.81 24,745 19,950 December 1, 2025 to December 31, 2025 78,653 38.52 78,653 16,920 Total 197,672 197,672 (1) Average price paid per share includes commissions and excise tax .
Description of Capital Stock AMERISAFE is authorized to issue 60,000,000 shares of capital stock, consisting of: • 10,000,000 shares of preferred stock, par value $0.01 per share; and • 50,000,000 shares of common stock, par value $0.01 per share. As of February 14, 2025, 19,050,315 shares of common stock were outstanding.
For more information on our credit agreement, see “Liquidity and Capital Resources” in Item 7 of this report. Description of Capital Stock AMERISAFE is authorized to issue 60,000,000 shares of capital stock, consisting of: • 10,000,000 shares of preferred stock, par value $0.01 per share; and • 50,000,000 shares of common stock, par value $0.01 per share.
On an annualized basis, the regular cash dividend is expected to be $1.56 per share in 2025. The declaration and payment of dividends is at the discretion of the board. We are a holding company and have no direct operations.
The declaration and payment of dividends is at the discretion of our board of directors. We are a holding company and have no direct operations. Our ability to pay dividends in the future depends on, among other things, the ability of our operating subsidiaries to pay dividends to us.
As of that date, there were no shares of preferred stock outstanding. Share Repurchases The Company’s board of directors initiated a share repurchase program in February 2010. In October 2016, the Board reauthorized this program with a limit of $25.0 million with no expiration date.
(2) In July 2025, the Company announced a share repurchase program that replaced the Company’s prior program, authorizing the repurchase of shares of the Company’s common stock in an aggregate amount of up to $25.0 million with no expiration date.
Removed
Our existing revolving credit agreement contains covenants that limit our ability to pay dividends on our common stock. For more information on our credit agreement, see “Liquidity and Capital Resources” in Item 7 of this report.
Added
As of February 13, 2026, 18,794,881 shares of common stock were outstanding. As of that date, there were no shares of preferred stock outstanding. See Exhibit 4.1 to this report for a more detailed description of our capital stock.
Removed
The Company had $5.3 million available for future purchases at December 31, 2024 under this program. There were 113,411 shares repurchased under this program in 2024 for $5.1 million, or an average price of $45.17, including commissions and excise tax.
Added
Share Repurchases As of December 31, 2025, we had repurchased a total of 1,974,140 shares for $54.2 million since the inception of our share repurchase program in 2010. The repurchases may be effected from time to time pursuant to trading plans meeting the requirements of Rule 10b5-1 under the Exchange Act.
Removed
There were 46,741 shares repurchased under this program in 2023 for $2.2 million, or an average price of $46.45, including commissions and excise tax. There were 264,449 shares repurchased under this program in 2022 for $12.4 million, or an average price of $46.84, including commissions.
Added
The share repurchase program does not obligate the Company to repurchase any shares of the Company’s common stock and may be modified, increased, suspended or terminated at the discretion of our board of directors.
Removed
Since the beginning of this plan, the Company has repurchased a total of 1,682,851 shares for $42.1 million, or an average price of $24.99, including commissions and excise tax.
Removed
The repurchases may be effected from time to time at the discretion of management and will depend on a variety of factors, including but not limited to, market conditions and applicable regulatory considerations. See “Forward-Looking Statements” in Part I above for further discussion. The share repurchase program may be modified, increased, suspended or terminated at the discretion of the board.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

89 edited+6 added−8 removed90 unchanged
Biggest changeYear Ended December 31, 2024 2023 2022 (in thousands) Income Statement Data Gross premiums written $ 294,144 $ 285,355 $ 276,110 Ceded premiums written (18,164 ) (16,621 ) (10,527 ) Net premiums written $ 275,980 $ 268,734 $ 265,583 Net premiums earned $ 270,639 $ 267,125 $ 271,698 Net investment income 29,212 31,339 27,223 Net realized gains (losses) on investments (576 ) 6,579 3,440 Net unrealized gains (losses) on equity securities 9,508 1,228 (8,092 ) Fee and other income 260 582 468 Total revenues 309,043 306,853 294,737 Loss and loss adjustment expenses incurred 157,267 148,263 152,316 Underwriting and certain other operating costs (1) 24,876 27,508 24,039 Commissions 23,750 23,446 21,483 Salaries and benefits 31,503 27,359 26,510 Policyholder dividends 2,657 2,957 2,699 Provision for investment related credit loss expense (benefit) (66 ) (57 ) 44 Total expenses 239,987 229,476 227,091 Income before taxes 69,056 77,377 67,646 Income tax expense 13,620 15,269 12,044 Net income $ 55,436 $ 62,108 $ 55,602 Selected Insurance Ratios Current accident year loss ratio (2) 71.0 % 71.0 % 71.0 % Prior accident year loss ratio (3) (12.9 )% (15.5 )% (14.9 )% Net loss ratio 58.1 % 55.5 % 56.1 % Net underwriting expense ratio (4) 29.6 % 29.3 % 26.5 % Net dividend ratio (5) 1.0 % 1.1 % 1.0 % Net combined ratio (6) 88.7 % 85.9 % 83.6 % As of December 31, 2024 2023 2022 (in thousands) Balance Sheet Data Cash and cash equivalents $ 44,045 $ 38,682 $ 61,469 Investments 788,778 857,786 888,987 Amounts recoverable from reinsurers 117,019 129,963 125,677 Premiums receivable, net 142,659 132,861 121,713 Deferred income taxes 19,448 20,403 22,794 Deferred policy acquisition costs 19,151 17,975 17,401 Total assets 1,157,791 1,229,162 1,269,279 Reserves for loss and loss adjustment expenses 651,309 673,994 696,037 Unearned premiums 121,926 116,585 114,976 Insurance-related assessments 14,852 16,896 17,653 Shareholders’ equity 257,341 292,451 317,432 (1) Includes policy acquisition expenses, and other general and administrative expenses, excluding commissions and salaries and benefits, related to insurance operations and corporate operating expenses. 43 (2) The current accident year loss ratio is calculated by dividing loss and loss adjustment expenses incurred for the current accident year by the current year’s net premiums earned.
Biggest changeYear Ended December 31, 2025 2024 2023 (in thousands) Income Statement Data Gross premiums written $ 313,864 $ 294,144 $ 285,355 Ceded premiums written (17,230 ) (18,164 ) (16,621 ) Net premiums written $ 296,634 $ 275,980 $ 268,734 Net premiums earned $ 283,057 $ 270,639 $ 267,125 Net investment income 26,993 29,212 31,339 Net realized gains (losses) on investments 3,034 (576 ) 6,579 Net unrealized gains on equity securities 3,719 9,508 1,228 Fee and other income 449 260 582 Total revenues 317,252 309,043 306,853 Loss and loss adjustment expenses incurred 169,937 157,267 148,263 Underwriting and certain other operating costs (1) 27,625 24,876 27,508 Commissions 25,092 23,750 23,446 Salaries and benefits 33,264 31,503 27,359 Policyholder dividends 2,526 2,657 2,957 Provision for investment related credit loss benefit (43 ) (66 ) (57 ) Total expenses 258,401 239,987 229,476 Income before taxes 58,851 69,056 77,377 Income tax expense 11,706 13,620 15,269 Net income $ 47,145 $ 55,436 $ 62,108 Selected Insurance Ratios Current accident year loss ratio (2) 72.0 % 71.0 % 71.0 % Prior accident year loss ratio (3) (12.0 )% (12.9 )% (15.5 )% Net loss ratio 60.0 % 58.1 % 55.5 % Net underwriting expense ratio (4) 30.4 % 29.6 % 29.3 % Net dividend ratio (5) 0.9 % 1.0 % 1.1 % Net combined ratio (6) 91.3 % 88.7 % 85.9 % As of December 31, 2025 2024 2023 (in thousands) Balance Sheet Data Cash and cash equivalents $ 61,926 $ 44,045 $ 38,682 Investments 734,855 788,778 857,786 Amounts recoverable from reinsurers 108,098 117,019 129,963 Premiums receivable, net 160,944 142,659 132,861 Deferred income taxes 17,572 19,448 20,403 Deferred policy acquisition costs 21,085 19,151 17,975 Total assets 1,130,544 1,157,791 1,229,162 Reserves for loss and loss adjustment expenses 613,583 651,309 673,994 Unearned premiums 135,503 121,926 116,585 Insurance-related assessments 15,979 14,852 16,896 Shareholders’ equity 251,598 257,341 292,451 (1) Includes policy acquisition expenses, and other general and administrative expenses, excluding commissions and salaries and benefits, related to insurance operations and corporate operating expenses. 42 (2) The current accident year loss ratio is calculated by dividing loss and loss adjustment expenses incurred for the current accident year by the current year’s net premiums earned.
The EBUB estimate is subject to significant variability and can either increase or decrease premiums receivable and earned premiums based upon several factors, including changes in premium growth, industry mix and economic conditions. EBUB assumptions include historical development factors, current economic outlook and current trends in particular sectors of our business. Assessments.
The EBUB estimate is subject to significant variability and can either increase or decrease premiums receivable and earned premiums based upon several factors, including changes in premium growth, industry mix and economic conditions. EBUB assumptions include historical development factors, current economic outlook and current trends in particular sectors of our policyholders' business. Assessments.
Dollar-denominated obligations of the U.S. or Canadian corporations, U.S. agency mortgage-backed securities, commercial mortgage-backed securities and asset-backed securities. 48 Under Nebraska and Texas law, as applicable, each of AIIC, SOCI and AIICTX is required to invest only in securities that are either interest-bearing, interest-accruing or eligible for dividends, and must limit its investment in the securities of any single issuer, other than direct obligations of the U.S., to five percent of the insurance company’s assets.
Dollar-denominated obligations of the U.S. or Canadian corporations, U.S. agency mortgage-backed securities, commercial mortgage-backed securities and asset-backed securities. 47 Under Nebraska and Texas law, as applicable, each of AIIC, SOCI and AIICTX is required to invest only in securities that are either interest-bearing, interest-accruing or eligible for dividends, and must limit its investment in the securities of any single issuer, other than direct obligations of the U.S., to five percent of the insurance company’s assets.
Due to the inherent uncertainty associated with these estimates, and the cost of incurred but unreported claims, our actual liabilities may vary significantly from our original estimates. 40 On a quarterly basis, we review our reserves for loss and loss adjustment expenses to determine whether adjustments are required. Any resulting adjustments are included in the results for the current period.
Due to the inherent uncertainty associated with these estimates, and the cost of incurred but unreported claims, our actual liabilities may vary significantly from our original estimates. 39 On a quarterly basis, we review our reserves for loss and loss adjustment expenses to determine whether adjustments are required. Any resulting adjustments are included in the results for the current period.
Our business strategy is focused on providing this coverage to small to mid-sized employers engaged in hazardous industries, principally construction, trucking, logging and lumber, agriculture, manufacturing, maritime, and telecommunications. Employers engaged in hazardous industries pay substantially higher than average rates for workers’ compensation insurance compared to employers in other industries, as measured per payroll dollar.
Our business strategy is focused on providing this coverage to small to mid-sized employers engaged in hazardous industries, principally construction, trucking, logging and lumber, agriculture, services, manufacturing, and maritime. Employers engaged in hazardous industries pay substantially higher than average rates for workers’ compensation insurance compared to employers in other industries, as measured per payroll dollar.
In accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 718, Compensation-Stock Compensation , we recognize compensation costs for restricted stock, restricted stock units, performance-based stock and stock option awards over the applicable vesting periods. 42 Results of Operations The table below summarizes certain operating results and key measures we use in monitoring and evaluating our operations.
In accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 718, Compensation-Stock Compensation , we recognize compensation costs for restricted stock, restricted stock units, performance-based stock and stock option awards over the applicable vesting periods. 41 Results of Operations The table below summarizes certain operating results and key measures we use in monitoring and evaluating our operations.
Hannover Re and Tokio Millenium Re remain obligated to the subsidiaries of the Company under other reinsurance agreements. As a result of the commutation, we recorded a pre-tax loss of approximately $1.5 million. In December 2024, the Company commuted reinsurance agreements with Hannover Re and Allianz Risk Transfer covering portions of accident years 2014-2016.
Hannover Re and Tokio Millennium Re remain obligated to the subsidiaries of the Company under other reinsurance agreements. As a result of the commutation, we recorded a pre-tax loss of approximately $1.5 million. In December 2024, the Company commuted reinsurance agreements with Hannover Re and Allianz Risk Transfer covering portions of accident years 2014-2016.
Under the agreement, advances may be made either in the form of loans or letters of credit. Borrowings under the agreement accrue at interest rates based upon prime rate or one-month term SOFR rate and are unsecured. At December 31, 2024, there were no outstanding borrowings. Unless renewed, the agreement will expire in May 2025.
Under the agreement, advances may be made either in the form of loans or letters of credit. Borrowings under the agreement accrue at interest rates based upon prime rate or one-month term SOFR rate and are unsecured. At December 31, 2025, there were no outstanding borrowings. Unless renewed, the agreement will expire in May 2026.
Offsetting these amounts were a $2.2 million decrease in insurance related assessments, a $0.4 million increase in ceding commission related to our current year reinsurance agreement, a $0.4 million increase in deferred policy acquisition costs, and a $0.3 million decrease in systems costs. Our underwriting expense ratio increased to 29.6% in 2024 from 29.3% in 2023. 44 Income tax expense.
Partially offsetting these amounts were a $2.2 million decrease in insurance related assessments, a $0.4 million increase in ceding commission related to our current year reinsurance agreement, a $0.4 million increase in deferred policy acquisition costs, and a $0.3 million decrease in systems costs. Our underwriting expense ratio increased to 29.6% in 2024 from 29.3% in 2023. Income tax expense.
As disclosed in Note 18 to our financial statements, our securities available-for-sale are classified using Level 1, 2 and 3 inputs. We did not elect the fair value option prescribed under FASB ASC Topic 825, Financial Instruments, for any financial assets in 2023 or 2024.
As disclosed in Note 18 to our financial statements, our securities available-for-sale are classified using Level 1, 2 and 3 inputs. We did not elect the fair value option prescribed under FASB ASC Topic 825, Financial Instruments, for any financial assets in 2024 or 2025.
Thus, for a one-year policy written on July 1, 2024 for an employer with constant payroll during the term of the policy, we would earn half of the premiums in 2024 and the other half in 2025. On a monthly basis, we also recognize net premiums earned from mandatory pooling arrangements.
Thus, for a one-year policy written on July 1, 2025 for an employer with constant payroll during the term of the policy, we would earn half of the premiums in 2025 and the other half in 2026. On a monthly basis, we also recognize net premiums earned from mandatory pooling arrangements.
Additional information regarding our reserves for loss and loss adjustment expenses and the actuarial methods and other factors used in establishing these reserves can be found under the caption “Business—Loss Reserves” in Item 1 of this report. 39 Underwriting and Certain Other Operating Costs.
Additional information regarding our reserves for loss and loss adjustment expenses and the actuarial methods and other factors used in establishing these reserves can be found under the caption “Business—Loss Reserves” in Item 1 of this report. 38 Underwriting and Certain Other Operating Costs.
If necessary, we establish a valuation allowance to reduce the deferred tax assets to the amounts that are more likely than not to be realized. 41 Credit Losses on Investment Securities. Investment securities are recorded on the balance sheet as assets net of an allowance for credit losses.
If necessary, we establish a valuation allowance to reduce the deferred tax assets to the amounts that are more likely than not to be realized. 40 Credit Losses on Investment Securities. Investment securities are recorded on the balance sheet as assets net of an allowance for credit losses.
The Company received a $6.3 million payment effectuated solely through offset against the balance of the funds withheld and recoverable from reinsurers' accounts under the reinsurance agreements in exchange for releasing Hannover Re and Tokio Millenium Re from their reinsurance obligations under the commuted agreements.
The Company received a $6.3 million payment effectuated solely through offset against the balance of the funds withheld and recoverable from reinsurers' accounts under the reinsurance agreements in exchange for releasing Hannover Re and Tokio Millennium Re from their reinsurance obligations under the commuted agreements.
As of December 31, 2024, we were in compliance with these requirements. We employ diversification policies and balance investment credit risk and related underwriting risks to minimize our total potential exposure to any one business sector or security.
As of December 31, 2025, we were in compliance with these requirements. We employ diversification policies and balance investment credit risk and related underwriting risks to minimize our total potential exposure to any one business sector or security.
These safety reviews are a vital component of our underwriting process and also promote safer workplaces. We utilize intensive claims management practices that we believe permit us to effectively manage the overall cost of our claims.
These safety reviews are a vital component of our underwriting process and also promote safer workplaces. We utilize proactive claims management practices that we believe permit us to effectively manage the overall cost of our claims.
In establishing our reserves, we review the results of analyses using actuarial methods that utilize historical loss data from our more than 39 years of underwriting workers’ compensation insurance. The actuarial analysis of our historical data provides the factors we use in estimating our loss reserves.
In establishing our reserves, we review the results of analyses using actuarial methods that utilize historical loss data from our more than 40 years of underwriting workers’ compensation insurance. The actuarial analysis of our historical data provides the factors we use in estimating our loss reserves.
However, as of December 31, 2024, actual results for these accident years have been better than our assumptions would have predicted. We do not presently intend to modify our assumptions for establishing reserves in light of recent results.
However, as of December 31, 2025, actual results for these accident years have been better than our assumptions would have predicted. We do not presently intend to modify our assumptions for establishing reserves in light of recent results.
We recognize commission income earned on policies issued by other carriers that are sold by our wholly-owned insurance agency subsidiary as the related services are performed. We also recognize a small portion of interest income from mandatory pooling arrangements in which we participate. Our expenses consist primarily of the following: Loss and Loss Adjustment Expenses Incurred.
We recognize commission income earned on policies issued by other carriers that are sold by our wholly-owned insurance agency subsidiary, Amerisafe General Agency, Inc., as the related services are performed. We also recognize a small portion of interest income from mandatory pooling arrangements in which we participate. Our expenses consist primarily of the following: Loss and Loss Adjustment Expenses Incurred.
We believe that the higher premiums typically paid by our policyholders, together with our disciplined underwriting and safety, claims and audit services, provide us with the opportunity to earn attractive returns for our shareholders. We actively market our insurance in 27 states through independent agencies, as well as through our wholly-owned insurance agency subsidiary.
We believe that the higher premiums typically paid by our policyholders, together with our disciplined underwriting and safety, claims and audit services, provide us with the opportunity to earn attractive returns for our shareholders. We actively market our insurance in 27 states through independent agencies, as well as through our wholly-owned insurance agency subsidiary, Amerisafe General Agency, Inc.
The favorable loss development we experienced across accident years was largely due to two factors: (1) lower than expected severity of injuries in these accident years compared to our original and revised estimates; and (2) favorable case reserve development from closed claims and claims where the worker had reached maximum medical improvement.
The favorable loss development we experienced across accident years was largely due to two factors: (1) lower than expected severity of injuries across prior accident years compared to our original and revised estimates; and (2) favorable case reserve development from closed claims and claims where the worker had reached maximum medical improvement.
In 2024, net realized losses resulted primarily from the sale of equity and fixed maturity securities classified as available-for-sale as well as the redemption of fixed maturity securities. In 2023, net realized gains resulted primarily from the sale of equity securities. Net Unrealized Gains (Losses) on Equity Securities .
In 2024, net realized losses on investments resulted primarily from the sale of equity and fixed maturity securities classified as available-for-sale as well as the redemption of fixed maturity securities. Net Unrealized Gains on Equity Securities .
In December 2024, the Company commuted reinsurance agreements with Hannover Re and Tokio Millenium Re covering portions of accident years 2012-2014.
In December 2024, the Company commuted reinsurance agreements with Hannover Re and Tokio Millennium Re covering portions of accident years 2012-2014.
In 2024, major components of net cash provided by investing activities included proceeds from sales and maturities of investments of $183.9 million, offset by investment purchases of $110.7 million. 47 In 2023, major components of net cash provided by investing activities included proceeds from sales and maturities of investments of $178.1 million, offset by investment purchases of $133.7 million.
In 2024, major components of net cash provided by investing activities included proceeds from sales and maturities of investments of $183.9 million, offset partially by investment purchases of $110.7 million. 46 In 2023, major components of net cash provided by investing activities included proceeds from sales and maturities of investments of $178.1 million, offset partially by investment purchases of $133.7 million.
Our primary uses of operating funds include payments for claims and operating expenses. We pay claims, operating expenses, shareholder dividends and repurchases using cash flow from operations and invest our excess cash in fixed maturity and equity securities.
Our primary uses of operating funds include payments for claims and operating expenses. We pay claims, operating expenses, shareholder dividends and repurchase shares using cash flow from operations and invest our excess cash in fixed maturity and equity securities.
We fund claim payments out of cash flow from 46 operations, principally premiums, net of amounts ceded to our reinsurers, and net investment income. Our investment portfolio at December 31, 2024 was $832.8 million. As discussed above under “Overview,” we purchase reinsurance to reduce our net liability on individual risks and to protect against catastrophic losses.
We fund claim payments out of cash flow from operations, principally premiums, net of amounts ceded to our reinsurers, and net investment income. Our investment portfolio at December 31, 2025 was $796.8 million. As discussed above under “Overview,” we purchase reinsurance to reduce our net liability on individual risks and to protect against catastrophic losses.
As of December 31, 2024, the present value of these annuities was $109.7 million, as estimated by our annuity providers. Substantially all of the annuities are issued or guaranteed by life insurance companies that have an A.M. Best rating of “A” (Excellent) or better.
As of December 31, 2025, the present value of these annuities was $105.7 million, as estimated by our annuity providers. Substantially all of the annuities are issued or guaranteed by life insurance companies that have an A.M. Best rating of “A” (Excellent) or better.
The composition of our investment portfolio, including cash and cash equivalents, as of December 31, 2024 is shown in the following table.
The composition of our investment portfolio, including cash and cash equivalents, as of December 31, 2025 is shown in the following table.
See “Forward-Looking Statements” in Part I above for further discussion. Overview We are a holding company that markets and underwrites workers’ compensation insurance through its insurance subsidiaries. Workers’ compensation insurance covers statutorily prescribed benefits that employers are obligated to provide to their employees who are injured in the course and scope of their employment.
See “Cautionary Statement Regarding Forward-Looking Statements” in Part I above for further discussion. Overview We are a holding company that markets and underwrites workers’ compensation insurance through its insurance subsidiaries. Workers’ compensation insurance covers statutorily prescribed benefits that employers are obligated to provide to their employees who are injured in the course and scope of their employment.
Payment of dividends by our insurance subsidiaries is restricted by state insurance laws, including laws establishing minimum solvency and liquidity thresholds. Based upon the prescribed calculation, the insurance subsidiaries could pay us dividends of up to $50.8 million in 2025 without seeking regulatory approval. See “Business—Regulation—Dividend Limitations” in Item 1 of this report.
Payment of dividends by our insurance subsidiaries is restricted by state insurance laws, including laws establishing minimum solvency and liquidity thresholds. Based upon the prescribed calculation, the insurance subsidiaries could pay us dividends of up to $40.1 million in 2026 without seeking regulatory approval. See “Business—Regulation—Dividend Limitations” in Item 1 of this report.
We calculate return on average equity by dividing annual net income by the average of annual shareholders’ equity. Our return on average equity was 20.2% in 2024, 20.4% in 2023 and 15.5% in 2022. We calculate book value per share by dividing ending shareholders’ equity by the number of common shares outstanding.
We calculate return on average equity by dividing annual net income by the average of annual shareholders’ equity. Our return on average equity was 18.5% in 2025, 20.2% in 2024 and 20.4% in 2023. We calculate book value per share by dividing ending shareholders’ equity by the number of common shares outstanding.
For additional information, see Note 16 to our consolidated financial statements in Item 8 of this report. The Company has operating and finance leases for office space and equipment. Our leases have remaining lease terms of one month to 49 months, some of which include options to extend the leases for up to five years.
For additional information, see Note 16 to our consolidated financial statements in Item 8 of this report. The Company has operating and finance leases for office space and equipment. Our leases have remaining lease terms of two months to 60 months, some of which include options to extend the leases for up to five years.
We pay commissions to our subsidiary insurance agency and to the independent agencies that sell our insurance based on premiums collected from policyholders. Salaries and Benefits. We pay salaries and provide benefits to our employees. Policyholder Dividends. In limited circumstances, we pay dividends to policyholders in particular states as an underwriting incentive. Income Tax Expense.
We pay commissions to our wholly-owned subsidiary insurance agency, Amerisafe General Agency, Inc., and to the independent agencies that sell our insurance based on premiums collected from policyholders. Salaries and Benefits. We pay salaries and provide benefits to our employees. Policyholder Dividends. In limited circumstances, we pay dividends to policyholders in particular states as an underwriting incentive. Income Tax Expense.
For the five accident years, the case incurred for these severe claims accounted for an average of 18.2 percentage points of our overall loss and loss adjustment expense (LAE) ratio, measured at December 31, 2024.
For the five accident years, the case incurred for these severe claims accounted for an average of 18.6 percentage points of our overall loss and loss adjustment expense (LAE) ratio, measured at December 31, 2025.
Net realized gains occur when our investment securities are sold for more than their cost or amortized cost, as applicable. Net realized losses occur when our investment securities are sold for less than their cost or amortized cost, as applicable. We classify the majority of our fixed maturity securities as held-to-maturity.
Net realized gains occur when our investment securities are sold for more than their cost or amortized cost, as applicable. Net realized losses occur when our investment securities are sold for less than their cost or amortized cost, as applicable. We classify just over a majority of our fixed maturity securities as held-to-maturity.
At December 31, 2024, our investment portfolio, including cash and cash equivalents, was $832.8 million and produced net investment income of $29.2 million in 2024, $31.3 million in 2023 and $27.2 million in 2022. The use of reinsurance is an important component of our business strategy.
At December 31, 2025, our investment portfolio, including cash and cash equivalents, was $796.8 million and produced net investment income of $27.0 million in 2025, $29.2 million in 2024 and $31.3 million in 2023. The use of reinsurance is an important component of our business strategy.
We seek to manage the funding of claim payments by actively managing available cash and forecasting cash flows on a short- and long-term basis. Cash payments, net of reinsurance, for claims were $172.9 million in 2024, $177.5 million in 2023 and $194.8 million in 2022.
We seek to manage the funding of claim payments by actively managing available cash and forecasting cash flows on a short- and long-term basis. Cash payments, net of reinsurance, for claims were $201.0 million in 2025, $172.9 million in 2024 and $177.5 million in 2023.
As a result of our focus on higher severity, lower frequency business, our reserve for loss and loss adjustment expenses may have greater volatility than other workers’ compensation insurance companies. For example, for the five-year period ended December 31, 2024 we recorded 86 severe claims, representing an average of 17 severe claims per year for accident years 2020 through 2024.
As a result of our focus on higher severity, lower frequency business, our reserve for loss and loss adjustment expenses may have greater volatility than other workers’ compensation insurance companies. For example, for the five-year period ended December 31, 2025 we recorded 91 severe claims, representing an average of 18 severe claims per year for accident years 2021 through 2025.
We believe the favorable case reserve development resulted primarily from an intensive claims management focus with the Company actively seeking to settle claims, leading to favorable development. The assumptions we used in establishing our reserves for these accident years were based on our historical claims data.
We believe the favorable case reserve development resulted primarily from a continued focus on our proactive claims management process with the Company actively seeking to settle claims, leading to favorable development. The assumptions we used in establishing our reserves for these accident years were based on our historical claims data.
We recorded favorable prior accident year development of $41.4 million in 2023, compared to $40.6 million in 2022. This is discussed in more detail below in “Prior Year Development.” Our net loss ratio was 55.5% for 2023 and 56.1% for 2022. Underwriting and Certain Other Operating Costs, Commissions and Salaries and Benefits.
We recorded favorable prior accident year development of $34.9 million in 2024, compared to $41.4 million in 2023. This is discussed in more detail below in “Prior Year Development.” Our net loss ratio was 58.1% for 2024 and 55.5% for 2023. Underwriting and Certain Other Operating Costs, Commissions and Salaries and Benefits.
As of December 31, 2024, our investment portfolio, including cash and cash equivalents, totaled $832.8 million, a decrease of 7.1% from December 31, 2023. The majority of our fixed maturity securities are classified as held-to-maturity, as defined by FASB ASC Topic 320, Investments-Debt and Equity Securities.
As of December 31, 2025, our investment portfolio, including cash and cash equivalents, totaled $796.8 million, a decrease of 4.3% from December 31, 2024. The majority of our fixed maturity securities are classified as held-to-maturity, as defined by FASB ASC Topic 320, Investments-Debt and Equity Securities.
We record reserves for estimated losses under insurance policies that we write and for loss adjustment expenses related to the investigation and settlement of claims. Reserves are based on estimates of the most likely ultimate cost of individual claims.
Our most significant balance sheet liability is our reserve for loss and loss adjustment expenses. We record reserves for estimated losses under insurance policies that we write and for loss adjustment expenses related to the investigation and settlement of claims. Reserves are based on estimates of the most likely ultimate cost of individual claims.
The Company experienced a $3.3 million increase in compensation expense, a $0.7 million decrease in profit sharing reinsurance commission, a $0.7 million increase in accounts receivable write-offs, a $0.4 million increase in travel and travel related items, and a $0.3 million increase in commission expense.
The increase was primarily due to a $3.3 million increase in compensation expense, a $0.7 million decrease in profit sharing reinsurance commission, a $0.7 million increase in accounts receivable write-offs, a $0.4 million increase in travel and travel related items, and a $0.3 million increase in commission expense.
The table below sets forth the favorable development for accident years 2019 through 2023 and, collectively, all accident years prior to 2019.
The table below sets forth the favorable development for accident years 2020 through 2024 and, collectively, all accident years prior to 2020.
The average pre-tax investment yield on our investment portfolio was 3.4% per annum for 2024 and 2023. The year-end tax-equivalent yield on our investment portfolio was 3.8% per annum for 2024, compared to 3.7% per annum for 2023. The tax-equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate.
The year-end tax-equivalent yield on our investment portfolio was 3.8% per annum for 2024, compared to 3.7% per annum for 2023. The tax-equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate. Net Realized Gains (Losses) on Investments.
In 2023 and 2022, net realized gains resulted primarily from the sale of equity securities. Net Unrealized Gains (Losses) on Equity Securities . Net unrealized gains on equity securities in 2023 were $1.2 million compared to net unrealized losses of $8.1 million in 2022. Loss and Loss Adjustment Expenses Incurred.
In 2023, net realized gains on investments resulted primarily from the sale of equity securities. Net Unrealized Gains on Equity Securities . Net unrealized gains on equity securities in 2024 were $9.5 million compared to net unrealized gains on equity securities of $1.2 million in 2023. Loss and Loss Adjustment Expenses Incurred.
Our book value per share was $13.51 at December 31, 2024, $15.28 at December 31, 2023 and $16.57 at December 31, 2022. We paid cash dividends of $4.48 per share in 2024, $4.86 per share in 2023 and $5.24 per share in 2022. Investment income is an important element of our net income.
Our book value per share was $13.39 at December 31, 2025, $13.51 at December 31, 2024 and $15.28 at December 31, 2023. We paid cash dividends of $2.56 per share in 2025, $4.48 per share in 2024 and $4.86 per share in 2023. Investment income is an important element of our net income.
The number of severe claims in any one accident year in this five-year period ranged from a low of 14 in 2023 to a high of 20 in 2021. The average reported case severity for these claims ranged from $2.28 million for the 2023 accident year to $3.96 million for the 2021 accident year.
The number of severe claims in any one accident year in this five-year period ranged from a low of 12 in 2023 to a high of 25 in 2025. The average reported case severity for these claims ranged from $2.0 million for the 2025 accident year to $3.8 million for the 2021 accident year.
Loss and LAE incurred totaled $148.3 million for 2023, compared to $152.3 million for 2022, a decrease of $4.1 million, or 2.7%. The current accident year losses and LAE incurred were $189.7 million, or 71.0% of net premiums earned, compared to $192.9 million, or 71.0% of net premiums earned for 2022.
Loss and LAE incurred totaled $157.3 million for 2024, compared to $148.3 million for 2023, an increase of $9.0 million, or 6.1%. The current accident year losses and LAE incurred were $192.2 million, or 71.0% of net premiums earned, compared to $189.7 million, or 71.0% of net premiums earned for 2023.
On February 25, 2025, we declared a regular quarterly cash dividend of $0.39 per share payable on March 21, 2025 to shareholders of record as of March 7, 2025. Our board of directors intends to continue to consider the payment of a regular cash dividend each calendar quarter.
On February 24, 2026, we declared a regular quarterly cash dividend of $0.41 per share payable on March 20, 2026 to shareholders of record as of March 13, 2026. Our board of directors intends to continue to consider the payment of a regular cash dividend each calendar quarter.
Net unrealized gains on equity securities in 2024 were $9.5 million compared to net unrealized gains of $1.2 million in 2023. Loss and Loss Adjustment Expenses Incurred. Loss and LAE incurred totaled $157.3 million for 2024, compared to $148.3 million for 2023, an increase of $9.0 million, or 6.1%.
Net unrealized gains on equity securities in 2025 were $3.7 million compared to net unrealized gains on equity securities of $9.5 million in 2024. Loss and Loss Adjustment Expenses Incurred. Loss and LAE incurred totaled $169.9 million for 2025, compared to $157.3 million for 2024, an increase of $12.7 million, or 8.1%.
We paid regular quarterly cash dividends of $0.37, $0.34, and $0.31 per share in 2024, 2023 and 2022, respectively. In addition, the Company paid extraordinary cash dividends of $3.00 in 2024, $3.50 per share in 2023, and $4.00 in 2022.
We paid regular quarterly cash dividends of $0.39, $0.37, and $0.34 per share in 2025, 2024 and 2023, respectively. In addition, the Company paid special cash dividends of $1.00, $3.00, and $3.50 per share in 2025, 2024 and 2023, respectively.
Net cash provided by operating activities was $24.2 million in 2024, as compared to $29.8 million in 2023, and $28.2 million in 2022. Major components of cash provided by operating activities in 2024 were net premiums collected of $263.2 million, investment income collected of $31.6 million, and reinsurance recoveries collected of $0.3 million.
Major components of cash provided by operating activities in 2024 were net premiums collected of $263.2 million, investment income collected of $31.6 million, and reinsurance recoveries collected of $0.3 million.
Carrying Value Percentage of Portfolio Effective Interest Rate (in thousands) Fixed maturity securities—held-to-maturity: State and political subdivisions $ 368,026 44.2 % 2.3 % Corporate bonds 33,763 4.1 % 0.5 % U.S. agency-based mortgage-backed securities 2,781 0.3 % 1.6 % U.S. Treasury securities and obligations of U.S.
Carrying Value Percentage of Portfolio Effective Interest Rate (in thousands) Fixed maturity securities—held-to-maturity: State and political subdivisions $ 322,407 40.5 % 3.4 % Corporate bonds 16,701 1.9 % 3.0 % U.S. agency-based mortgage-backed securities 2,403 0.3 % 4.1 % U.S. Treasury securities and obligations of U.S.
Income tax expense for 2024 was $13.6 million, compared to $15.3 million for 2023. The effective tax rate was 19.7% for both 2024 and 2023. Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Gross Premiums Written . Gross premiums written for 2023 were $285.4 million, compared to $276.1 million for 2022, an increase of 3.3%.
The effective tax rate was 19.9% for 2025 and 19.7% for 2024. 43 Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Gross Premiums Written . Gross premiums written for 2024 were $294.1 million, compared to $285.4 million for 2023, an increase of 3.1%.
Overview of Operating Results Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Gross Premiums Written . Gross premiums written for 2024 were $294.1 million, compared to $285.4 million for 2023, an increase of 3.1%.
Overview of Operating Results Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Gross Premiums Written . Gross premiums written for 2025 were $313.9 million, compared to $294.1 million for 2024, an increase of 6.7%.
The increase was attributable to a $10.1 million increase in premiums resulting from payroll audits and related premium adjustments for policies written in previous periods, and a $0.8 million increase in annual premiums on voluntary policies written during the period. The increases were partially offset by a $1.6 million decrease in residual market premium. Net Premiums Written.
The increase was attributable to a $27.1 million increase in annual premiums on voluntary policies written during the period, driven mostly by a 10.2% increase in in-force policy count. This increase was partially offset by a $7.6 million decrease in premiums resulting from payroll audits and related premium adjustments for policies written in previous periods. Net Premiums Written.
On an annualized basis, the cash dividend is expected to be $1.56 per share in 2025. Investment Portfolio The principal objectives of our investment portfolio are to preserve capital and surplus and to maintain appropriate liquidity for corporate requirements. Additional objectives are to support our A.M. Best rating of “A” (Excellent) and to maximize after-tax income and risk-adjusted total return.
Investment Portfolio The principal objectives of our investment portfolio are to preserve capital and surplus and to maintain appropriate liquidity for corporate requirements. Additional objectives are to support our A.M. Best rating of “A” (Excellent) and to maximize after-tax income and risk-adjusted total return.
Net premiums written for 2023 were $268.7 million, compared to $265.6 million for 2022, an increase of 1.2%. The increase was primarily attributable to the increase in gross premiums written. As a percentage of gross premiums earned, ceded premiums were 5.9% for 2023 compared to 3.7% for 2022.
Net premiums written for 2025 were $296.6 million, compared to $276.0 million for 2024, an increase of 7.5%. The increase was primarily attributable to the increase in gross premiums written. As a percentage of gross premiums earned, ceded premiums were 5.7% for 2025 compared to 6.3% for 2024.
Less Than Twelve Months Twelve Months or Longer Fair Value Unrealized Losses Fair Value Unrealized Losses (in thousands) December 31, 2024: Fixed maturity securities—available-for-sale $ 175,099 $ (7,984 ) $ 60,615 $ (4,637 ) December 31, 2023: Fixed maturity securities—available-for-sale 40,293 (207 ) 184,313 (11,588 ) 49 The pre-tax investment yield on our investment portfolio was 3.4% per annum during the twelve months ended December 31, 2024 and 2023.
Less Than Twelve Months Twelve Months or Longer Fair Value Unrealized Losses Fair Value Unrealized Losses (in thousands) December 31, 2025: Fixed maturity securities—available-for-sale $ 34,429 $ (642 ) $ 123,699 $ (6,297 ) December 31, 2024: Fixed maturity securities—available-for-sale 175,099 (7,984 ) 60,615 (4,637 ) 48 The average pre-tax net investment yield on our investment portfolio was 3.3% and 3.4% per annum during the twelve months ended December 31, 2025 and 2024, respectively.
Major components of cash used in financing activities in 2023 included cash used for dividends paid to shareholders of $93.3 million, purchases of treasury stock of $2.2 million, and share-based compensation related tax withholding of $0.9 million.
Major components of cash used in financing activities in 2023 included cash used for dividends paid to shareholders of $93.3 million, purchases of treasury stock of $2.2 million, and share-based compensation related tax withholding of $0.9 million. In 2025, the Company renewed a line of credit agreement with Frost Bank for borrowings up to a maximum of $20.0 million.
These amounts were offset in part by claim payments of $206.3 million, $64.6 million of operating expenditures, federal taxes paid of $7.8 million, and dividends to policyholders paid of $3.4 million.
These amounts were offset in part by claim payments of $205.3 million, $76.5 million of operating expenditures, federal taxes paid of $11.3 million, and dividends to policyholders paid of $3.1 million.
In 2023, we decreased our estimates for prior year loss reserves by $41.4 million. In 2022, we decreased our estimates for prior year loss reserves by $40.6 million.
In 2025, we decreased our estimates for prior year loss reserves by $33.9 million. In 2024, we decreased our estimates for prior year loss reserves by $34.9 million. In 2023, we decreased our estimates for prior year loss reserves by $41.4 million.
Our gross reserves for loss and loss adjustment expenses at December 31, 2024, 2023 and 2022 were $651.3 million, $674.0 million and $696.0 million, respectively. As a percentage of gross reserves at year end, IBNR represented 16.5% in 2024, 17.8% in 2023 and 17.1% in 2022. In 2024, we decreased our estimates for prior year loss reserves by $34.9 million.
Our gross reserves for loss and loss adjustment expenses at December 31, 2025, 2024 and 2023 were $613.6 million, $651.3 million and $674.0 million, respectively. As a percentage of gross reserves at year end, reserves for expenses incurred but not reported (IBNR) represented 10.5% in 2025, 16.5% in 2024 and 17.8% in 2023.
Therefore, estimating reserves for workers’ compensation claims may be more uncertain than estimating reserves for other types of insurance claims with shorter or 37 more definite periods between occurrence of the claim and final determination of the loss and with policy limits on liability for claim amounts.
Therefore, estimating reserves for workers’ compensation claims may be more uncertain than estimating reserves for other types of insurance claims with shorter or more definite periods between occurrence of the claim and final determination of the loss and with policy limits on liability for claim amounts. 36 Our focus on providing workers’ compensation insurance to employers engaged in hazardous industries results in our receiving relatively fewer but more severe claims than many other workers’ compensation insurance companies.
We expect that our projected cash flow from operations will provide us sufficient liquidity to fund future operations, including payment of claims and operating expenses and other holding company expenses, for at least the next 12 months. We forecast claim payments based on our historical trends.
We expect that our projected cash flow from operations will be sufficient to meet our short-term and long-term liquidity needs, including payment of claims and operating expenses and other holding company expenses. We forecast claim payments based on our historical trends.
Government agencies 8,478 1.0 % 1.3 % Asset-backed securities 13 0.0 % 5.9 % Total fixed maturity securities—held-to-maturity 413,061 49.6 % 1.6 % Fixed maturity securities—available-for-sale: State and political subdivisions 148,206 17.8 % 1.1 % Corporate bonds 141,535 17.0 % 3.6 % U.S. agency-based mortgage-backed securities 4,059 0.5 % 1.6 % U.S. Treasury securities and obligations of U.S.
Government agencies 8,567 1.1 % 3.4 % Asset-backed securities 9 0.0 % 5.9 % Total fixed maturity securities—held-to-maturity 350,087 43.8 % 3.4 % Fixed maturity securities—available-for-sale: State and political subdivisions 158,190 19.9 % 3.9 % Corporate bonds 138,704 17.4 % 4.8 % U.S. agency-based mortgage-backed securities 3,641 0.5 % 2.6 % U.S. Treasury securities and obligations of U.S.
Government agencies 13,950 1.7 % 1.0 % Total fixed maturity securities—available-for-sale 307,750 37.0 % 1.5 % Equity securities 58,629 7.0 % 1.4 % Short-term investments 9,338 1.1 % 0.2 % Cash and cash equivalents 44,045 5.3 % 4.4 % Total Investments, including cash and cash equivalents $ 832,823 100.0 % 3.5 % The following table summarizes the gross unrealized losses and fair value of fixed income securities by the length of time that individual securities have been in a continuous unrealized loss position.
Government agencies 12,503 1.6 % 1.5 % Total fixed maturity securities—available-for-sale 313,038 39.4 % 4.2 % Equity securities 57,493 7.2 % 1.2 % Short-term investments 14,237 1.8 % 4.3 % Cash and cash equivalents 61,926 7.8 % 3.1 % Total Investments, including cash and cash equivalents $ 796,781 100.0 % 3.5 % The following table summarizes the gross unrealized losses and fair value of fixed income securities by the length of time that individual securities have been in a continuous unrealized loss position.
This is discussed in more detail below in “Prior Year Development.” Our net loss ratio was 58.1% for 2024 and 55.5% for 2023. Underwriting and Certain Other Operating Costs, Commissions and Salaries and Benefits. Underwriting and certain other operating costs, commissions and salaries and benefits for 2024 were $80.1 million, compared to $78.3 million for 2023.
We recorded favorable prior accident year development of $33.9 million in 2025, compared to $34.9 million in 2024. This is discussed in more detail below in “Prior Year Development.” Our net loss ratio was 60.0% for 2025 and 58.1% for 2024. Underwriting and Certain Other Operating Costs, Commissions and Salaries and Benefits.
The year-end tax-equivalent yield on our investment portfolio was 3.7% per annum for 2023, compared to 3.4% per annum for 2022. The tax-equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate.
The year-end tax-equivalent yield on our investment portfolio was 3.8% per annum for both 2025 and 2024. The tax-equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate. Net Realized Gains (Losses) on Investments.
These amounts were offset in part by claim payments of $172.9 million, $73.9 million of operating expenditures, federal taxes paid of $14.0 million, and dividends to policyholders paid of $3.5 million. Major components of cash provided by operating activities in 2022 were net premiums collected of $278.9 million and investment income collected of $33.6 million.
These amounts were offset in part by claim payments of $172.9 million, $73.9 million of operating expenditures, federal taxes paid of $14.0 million, and dividends to policyholders paid of $3.5 million. Net cash provided by investing activities was $68.4 million in 2025, as compared to $72.4 million in 2024 and $43.9 million in 2023.
Ceded premiums increased as we purchased higher levels of reinsurance coverage at generally higher prices in 2023. For additional information, see Item 1, “Business—Reinsurance.” Net Premiums Earned . Net premiums earned for 2023 were $267.1 million, compared to $271.7 million for 2022, a decrease of 1.7%. The decrease was primarily attributable to the increase in the cost of reinsurance.
Ceded premiums decreased as we purchased levels of reinsurance coverage at generally lower prices in 2025. For additional information, see Item 1, “Business—Reinsurance.” Net Premiums Earned . Net premiums earned for 2025 were $283.1 million, compared to $270.6 million for 2024, an increase of 4.6%. The increase was primarily attributable to the increase in net premiums written. Net Investment Income.
Underwriting and certain other operating costs, commissions and salaries and benefits for 2023 were $78.3 million, compared to $72.0 million for 2022. The Company experienced a $4.1 million increase in insurance related assessments, a $2.0 million increase in commission expense, a $1.5 million increase in professional fees, and a $0.8 million increase in compensation expense.
Underwriting and certain other operating costs, commissions and salaries and benefits for 2025 were $86.0 million, compared to $80.1 million for 2024. The increase was primarily due to a $3.1 million increase in insurance related assessments, a $1.5 million increase in compensation expense, a $1.3 million increase in commission expense and a $0.5 million increase in accounts receivable write-offs.
Average invested assets, including cash and cash equivalents, decreased 6.9%, from an average of $955.8 million for 2023 to an average of $890.4 million for 2024. Net Realized Gains (Losses) on Investments. Net realized losses on investments in 2024 totaled $0.6 million compared to gains of $6.6 million in 2023.
Average invested assets, including cash and cash equivalents, decreased 6.9%, from an average of $955.8 million for 2023 to an average of $890.4 million for 2024. The average pre-tax net investment yield on our investment portfolio was 3.4% per annum for 2024 and 2023.
Even if we maintain our existing retention levels, if the cost of reinsurance increases, our cash flow from operations would decrease as we would cede a greater portion of our written premiums to our reinsurers. Conversely, our cash flow from operations would increase if the cost of reinsurance declined relative to our retention.
We reevaluate our reinsurance program at least annually, taking into consideration a number of factors, including cost of reinsurance, our liquidity requirements, operating leverage and coverage terms. 45 Even if we maintain our existing retention levels, if the cost of reinsurance increases, our cash flow from operations would decrease as we would cede a greater portion of our written premiums to our reinsurers.
Our board of directors initially authorized the Company’s share repurchase program in February 2010. In October 2016, the Board reauthorized this program with a limit of $25.0 million with no expiration date. As of December 31, 2024, we had repurchased a total of 1,682,851 shares of our outstanding common stock for $42.1 million.
Our board of directors initially authorized the Company’s share repurchase program in February 2010. In July 2025, our board of directors reauthorized this program with a limit of $25.0 million with no expiration date. As of December 31, 2025, $16.9 million was available for future repurchases under the share repurchase program.
The increase in the effective tax rate is due to a lower proportion of tax-exempt income to underwriting income in 2023 relative to 2022. 45 Prior Year Development The Company recorded favorable prior accident year loss and loss adjustment expense development of $34.9 million in calendar year 2024, $41.4 million in calendar year 2023 and $40.6 million in calendar year 2022.
The effective tax rate was 19.7% for both 2024 and 2023. 44 Prior Year Development The Company recorded favorable prior accident year loss and loss adjustment expense development of $33.9 million in calendar year 2025, $34.9 million in calendar year 2024 and $41.4 million in calendar year 2023.
Based on our estimates of future claims, we believe we are sufficiently capitalized to satisfy the deductibles and retentions in our 2025 reinsurance program. We reevaluate our reinsurance program at least annually, taking into consideration a number of factors, including cost of reinsurance, our liquidity requirements, operating leverage and coverage terms.
Based on our estimates of future claims, we believe we are sufficiently capitalized to satisfy the deductibles and retentions in our 2026 reinsurance program.
In 2022, major components of net cash provided by investing activities included proceeds from sales and maturities of investments of $293.0 million, offset by investment purchases of $215.5 million. Net cash used in financing activities was $91.2 million in 2024, as compared to $96.5 million in 2023 and $112.9 million in 2022.
In 2025, major components of net cash provided by investing activities included proceeds from sales and maturities of investments of $137.6 million, offset partially by investment purchases of $67.0 million, and purchases of property and equipment of $2.1 million.
The current accident year losses and LAE incurred were $192.2 million, or 71.0% of net premiums earned, compared to $189.7 million, or 71.0% of net premiums earned for 2023. We recorded favorable prior accident year development of $34.9 million in 2024, compared to $41.4 million in 2023.
The current accident year losses and LAE incurred were $203.8 million, or 72.0% of net premiums earned, compared to $192.2 million, or 71.0% of net premiums earned for 2024. The Company increased the 2025 accident year loss ratio from 71% to 72% largely due to the frequency of severity observed in accident year 2025 compared with prior accident years.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeHypothetical Change in Interest Rates Fair Value Estimated Change in Fair Value Carrying Value Estimated Change in Carrying Value Hypothetical Percentage Increase (Decrease) in Shareholders’ Equity 200 basis point increase $ 631,032 $ (76,439 ) $ 687,398 $ (33,412 ) (12.9 )% 100 basis point increase 669,647 (37,823 ) 704,036 (16,775 ) (6.5 )% No change 707,471 — 720,811 — 0.0 % 100 basis point decrease 741,160 33,690 736,708 15,897 6.1 % 200 basis point decrease 770,983 63,513 751,958 31,147 12.0 % Equity Price Risk Equity price risk is the risk that we may incur losses due to adverse changes in the market prices of the equity securities we hold in our investment portfolio.
Biggest changeHypothetical Change in Interest Rates Fair Value Estimated Change in Fair Value Carrying Value Estimated Change in Carrying Value Hypothetical Percentage Increase (Decrease) in Shareholders’ Equity 200 basis point increase $ 585,567 $ (72,047 ) $ 628,933 $ (34,192 ) (13.6 )% 100 basis point increase 621,874 (35,740 ) 645,717 (17,408 ) (6.9 )% No change 657,614 — 663,125 — 0.0 % 100 basis point decrease 688,842 31,228 679,925 16,800 6.7 % 200 basis point decrease 715,981 58,367 695,691 32,566 12.9 % Equity Price Risk Equity price risk is the risk that we may incur losses due to adverse changes in the market prices of the equity securities we hold in our investment portfolio.
The table below summarizes the interest rate risk associated with our fixed maturity securities by illustrating the sensitivity of the fair value and carrying value of our fixed maturity securities as of December 31, 2024 to selected hypothetical changes in interest rates, and the associated impact on our shareholders’ equity.
The table below summarizes the interest rate risk associated with our fixed maturity securities by illustrating the sensitivity of the fair value and carrying value of our fixed maturity securities as of December 31, 2025 to selected hypothetical changes in interest rates, and the associated impact on our shareholders’ equity.
In order to minimize our exposure to equity price risk, we independently monitor the financial 50 condition of our equity securities and diversify our investments. In addition, we limit the percentage of equity securities held in our investment portfolio to the lesser of 10% of the investment portfolio or 30% of shareholders’ equity.
In order to minimize our exposure to equity price risk, we independently monitor the financial 49 condition of our equity securities and diversify our investments. In addition, we limit the percentage of equity securities held in our investment portfolio to the lesser of 10% of the investment portfolio or 30% of shareholders’ equity.
At December 31, 2024, the effective duration of the total investment portfolio, including cash and short-term investments, was 4.4 years.
At December 31, 2025, the effective duration of the total investment portfolio, including cash and short-term investments, was 4.3 years.
Interest Rate Risk Interest rate risk is the risk that we may incur losses due to adverse changes in interest rates. As of December 31, 2024, we had fixed maturity securities with a fair value of $707.5 million and a carrying value of $720.8 million.
Interest Rate Risk Interest rate risk is the risk that we may incur losses due to adverse changes in interest rates. As of December 31, 2025, we had fixed maturity securities with a fair value of $657.6 million and a carrying value of $663.1 million.
As of December 31, 2024, the equity securities in our investment portfolio had a fair value of $58.6 million, representing 7.0% of our investment portfolio and less than 22.8% of shareholders’ equity on that date. 51
As of December 31, 2025, the equity securities in our investment portfolio had a fair value of $57.5 million, representing 7.2% of our investment portfolio and less than 22.9% of shareholders’ equity on that date. 50

Other AMSF 10-K year-over-year comparisons