The following table shows the number of our retail locations. Retail location counts are based upon the date that a location commenced or ceased writing business. The 89 closed locations for the year included 53 that were part of our recent actions to improve profitability, 24 in the Chicago-area whose leases expired in January 2016, and 12 others closed in the normal course of business. The 4 opened locations were strategically-placed to replace and consolidate the closed Chicago-area locations.
Loss before income taxes from real estate and corporate operations for the year ended December 31, 2015 was $2.9 million, compared with a loss from real estate and corporate operations before income taxes of $2.8 million for the year ended December 31, 2014. Segment losses consist of other operating expenses not directly related to our insurance operations, interest expense and stock-based compensation offset by investment income on corporate invested assets. We incurred $3.0 million of interest expense during the year ended December 31, 2015, compared with interest expense of $1.7 during the year ended December 31, 2014. Interest expense related to the financing of the Titan acquisition account for $1.2 million of the expense and the remaining expense related to the debentures issued in June 2007. For additional information, see “Liquidity and Capital Resources” in Item 7 of this report.
Regarding our past estimates, for the year ended December 31, 2016, we experienced unfavorable development on reserves at December 31, 2015 of $30.6 million, which increased our loss and loss adjustment expense for prior accident periods. This unfavorable development was the result of increased losses primarily from the 2015 accident year across all major coverages. The most significant causes of the development were a greater than usual emergence of reported claims and higher bodily injury severity than we had originally estimated.
In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” which requires companies to evaluate whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the financial statements are issued. The evaluation will be required for each annual and interim reporting period. This guidance has an effective date for public companies for annual reporting periods ending after December 15, 2016 and interim reporting periods thereafter, with early adoption permitted. The Company adopted this requirement effective December 31, 2016 which did not have a material impact on the consolidated financial statements.
In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” which clarifies how entities should classify certain cash receipts and cash payments, including how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The guidance is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those years. Early adoption is permitted. Entities will have to apply the guidance retrospectively, but if it is impracticable to do so for an issue, the amendments related to that issue would be applied prospectively. The Company has not determined the impact on future consolidated financial statements once this is adopted.
Assumed business represents private-passenger non-standard automobile insurance premiums in Texas written through a program with a county mutual insurance company and assumed by the Company through 100% quota-share reinsurance. The percentages of premiums assumed to net premiums written was 13% for each of the years ended December 31, 2016, 2015 and 2014, respectively.
The Company had a valuation allowance of $1.9 and $1.7 million at December 31, 2016 and 2015, respectively, relating to certain amounts that are more likely than not to be realized. In assessing our ability to realize the deferred tax asset (“DTA”), both positive and negative evidence are used to evaluate the allowance. Although the Company has incurred a pre-tax loss of $45.1 million which is a source of negative evidence, greater weight was placed on the Company’s outlook for future taxable income over the allowable time period for realization of the DTA and concluded that it is more likely than not that the remaining DTA will be realized. Regarding the length of time available to realize the DTA, at December 31, 2016, $24.2 million of the DTA related to net operating loss carryforwards do not expire until 2031 through 2036 and $2.0 million in AMT (“Alternative Minimum Tax”) carryforwards have no expiration date. The DTA valuation allowance may be adjusted in future periods if management determines that it is more likely than not that some portion or all of the DTA will not be realized. In the event the DTA valuation allowance is adjusted, the Company would record an income tax expense for the adjustment.
Liabilities assumed included a $2.0 million estimate of the expected liability for returned commissions as of the closing date. This liability was subject to change based on the actual amount of returned commissions and the Company’s final estimation of this liability resulted in a $0.8 million reduction in goodwill through June 30, 2016.