Company: KNSL
Filing Date: 2025-07-24
Form Type: 10-Q
Source: 0001669162-25-000043
Chunk: 81

Company: Kinsale Capital Group, Inc.
Filing Date: 2025-07-24
Form: 10-Q
Item: Item 8
Chunk 81
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-dilutive stock awards for the six months ended June 30, 2025 and 2024, respectively. 

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Table of Contents

10.  Income Taxes 

The Company uses the estimated annual effective tax rate method for calculating its tax provision in interim periods, which represents the Company's best estimate of the effective tax rate expected for the full year. The estimated annual effective tax rate typically differs from the U.S. statutory tax rate, primarily as a result of tax-exempt investment income and any discrete items recognized during the period. The Company's effective tax rates were 20.4% and 17.3% for the six months ended June 30, 2025 and 2024, respectively, and were lower than the federal statutory rate of 21% due primarily to the tax benefits from stock-based compensation, including stock options exercised, and from income generated by certain tax-exempt investments. The effective tax rate was higher for the six months ended June 30, 2025 due primarily to a lower volume of stock options exercised compared to the same period in 2024. On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted into law. The OBBBA extends or makes permanent various tax provisions that were originally enacted in the 2017 Tax Cuts and Jobs Act and were set to expire at the end of 2025. The Company is currently evaluating the impact of the OBBBA on its consolidated financial statements.

 11.     Reserves For Unpaid Losses and Loss Adjustment Expenses

The following table presents a reconciliation of consolidated beginning and ending reserves for unpaid losses and loss adjustment expenses:June 30,20252024(in thousands)Gross reserves for unpaid losses and loss adjustment expenses, beginning of year$2,285,668 $1,692,875 Less: reinsurance recoverable on unpaid losses323,060 241,357 Net reserves for unpaid losses and loss adjustment expenses, beginning of year1,962,608 1,451,518 Incurred losses and loss adjustment expenses:Current year480,430 398,058 Prior years(30,095)(17,947)Total net losses and loss adjustment expenses incurred450,335 380,111 Payments:Current year28,574 8,114 Prior years142,674 102,829 Total payments171,248 110,943 Net reserves for unpaid losses and loss adjustment expenses,