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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________

FORM 10-Q

_______________________________

(Mark One)


x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022


¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For transition period from __________ to __________.

Commission File Number: 001-38046

ICC Holdings, Inc.

(Exact name of registrant as specified in its charter)

_______________________________

Pennsylvania

(State or other jurisdiction of
‎incorporation or organization)

81-3359409

(I.R.S. Employer
‎Identification No.)

225 20th Street, Rock Island, Illinois

(Address of principal executive offices)

61201

(Zip Code)

(309) 793-1700

(Registrant’s telephone number, including area code)

_______________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading ‎Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	ICCH	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  No 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes  No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


	Large accelerated filer ¨	Accelerated filer ¨
	Non-accelerated filer x	Smaller reporting company x
		Emerging growth company x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

The number of shares of the registrant’s common stock outstanding as of May 3, 2022 was 3,296,896.

Table of Contents


		Page
PART I
Item 1.	Financial Statements
	Condensed Consolidated Balance Sheets as of March 31, 2022 (unaudited) and December 31, 2021	3
	Condensed Consolidated Statements of Earnings and Comprehensive Earnings for the Three-Month Periods Ended March 31, 2022 and 2021 (unaudited)	4
	Condensed Consolidated Statements of Stockholders Equity for the Three-Month Periods Ended March 31, 2022 and 2021 (unaudited)	5
	Condensed Consolidated Statements of Cash Flows for the Three-Month Periods Ended March 31, 2022 and 2021 (unaudited)	6
	Notes to Unaudited Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	30
Item 4.	Controls and Procedures	31

PART II
Item 1.	Legal Proceedings	31
Item 1A.	Risk Factors	31
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31
Item 3.	Default Upon Senior Securities	32
Item 4.	Mine Safety Disclosures	32
Item 5.	Other Information	32
Item 6.	Exhibits	33

Signatures		34

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Table of Contents

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

ICC Holdings, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets



	As of
	March 31,		December 31,
	2022		2021
		(Unaudited)
Assets
Investments and cash:
Fixed maturity securities (amortized cost of $104,466,061 at 3/31/2022 and $102,145,223 at 12/31/2021)	$	101,872,420	$	105,841,543
Common stocks at fair value		22,795,115		23,608,197
Preferred stocks at fair value		2,858,036		2,780,450
Other invested assets		3,175,674		3,086,568
Property held for investment, at cost, net of accumulated depreciation of $504,718 at 3/31/2022 and $464,713 at 12/31/2021		5,871,484		5,509,114
Cash and cash equivalents		4,580,287		4,606,378
Total investments and cash		141,153,016		145,432,250
Accrued investment income		726,561		659,413
Premiums and reinsurance balances receivable, net of allowances for uncollectible amounts of $100,000 at 3/31/2022 and 12/31/2021		27,410,129		27,199,804
Ceded unearned premiums		948,000		967,022
Reinsurance balances recoverable on unpaid losses and settlement expenses, net of allowances for uncollectible amounts of $0 at 3/31/2022 and 12/31/2021		16,088,694		14,521,219
Federal income taxes		631,825		195,694
Deferred policy acquisition costs, net		7,156,770		6,538,844
Property and equipment, at cost, net of accumulated depreciation of $6,302,395 at 3/31/2022 and $6,243,055 at 12/31/2021		3,189,728		3,144,218
Other assets		1,305,288		1,343,504
Total assets	$	198,610,011	$	200,001,968
Liabilities and Equity
Liabilities:
Unpaid losses and settlement expenses	$	67,407,376	$	61,834,809
Unearned premiums		37,509,068		36,212,266
Reinsurance balances payable		503,656		1,368,294
Corporate debt		18,452,288		18,455,342
Accrued expenses		4,174,785		5,441,611
Income taxes - deferred		—		954,862
Other liabilities		872,609		1,030,870
Total liabilities		128,919,782		125,298,054
Equity:
Common stock¹		35,000		35,000
Treasury stock, at cost²		(3,122,492)		(3,155,399)
Additional paid-in capital		32,989,963		32,965,136
Accumulated other comprehensive earnings, net of tax		(2,049,042)		2,920,027
Retained earnings		44,122,755		44,282,895
Less: Unearned Employee Stock Ownership Plan shares at cost³		(2,285,955)		(2,343,745)
Total equity		69,690,229		74,703,914
Total liabilities and equity	$	198,610,011	$	200,001,968

¹Par value $0.01; authorized: 2022 - 10,000,000 shares and 2021 – 10,000,000 shares; issued: 2022 – 3,500,000 shares and 2021 – 3,500,000 shares; outstanding: 2022 –3,293,811 and 2021 - 3,291,852 shares

²2022 –206,189 shares and 2021 –208,148 shares

³2022 –228,595 shares and 2021 –234,374 shares

See accompanying notes to consolidated financial statements.

‎

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Table of Contents

ICC Holdings, Inc. and Subsidiaries

Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited)



	For the Three-Months Ended
	March 31,
	2022		2021
Net premiums earned	$	16,016,677	$	12,048,713
Net investment income		917,081		801,406
Net realized investment gains		207,585		186,709
Net unrealized (losses) gains on equity securities		(1,292,692)		876,316
Other income		159,431		46,716
Consolidated revenues		16,008,082		13,959,860
Losses and settlement expenses		10,195,201		7,802,706
Policy acquisition costs and other operating expenses		5,772,400		4,467,578
Interest expense on debt		61,011		53,702
General corporate expenses		189,415		163,982
Total expenses		16,218,027		12,487,968
(Loss) earnings before income taxes		(209,945)		1,471,892
Total income tax (benefit) expense		(49,805)		309,951
Net (loss) earnings	$	(160,140)	$	1,161,941

Other comprehensive loss, net of tax		(4,969,069)		(2,226,522)
Comprehensive loss	$	(5,129,209)	$	(1,064,581)

Earnings per share:
Basic:
Basic net (loss) earnings per share	$	(0.05)	$	0.38
Diluted:
Diluted net (loss) earnings per share	$	(0.05)	$	0.38

Weighted average number of common shares outstanding:
Basic		3,060,208		3,034,233
Diluted		3,072,176		3,044,479

See accompanying notes to consolidated financial statements.

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Table of Contents

ICC Holdings, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)


	Common stock		Treasury stock			Unearned ESOP		Additional paid-in capital		Retained ‎earnings		Accumulated ‎other ‎comprehensive ‎earnings (loss)		Total equity
Balance, January 1, 2021	$	35,000	$	(3,153,838)		$	(2,578,115)	$	32,780,436	$	40,140,115	$	5,520,091	$	72,743,689
Purchase of treasury stock		—		(19,174)			—		—		—		—		(19,174)
Net earnings		—		—			—		—		1,161,941		—		1,161,941
Other comprehensive loss, net of tax		—		—			—		—		—		(2,226,522)		(2,226,522)
Restricted stock unit expense		—		77,947	¹		—		(39,831)		—		—		38,116
ESOP compensation expense		—		—			57,790		24,960		—		—		82,750
Balance, March 31, 2021	$	35,000	$	(3,095,065)		$	(2,520,325)	$	32,765,565	$	41,302,055	$	3,293,569	$	71,780,799



	Common stock		Treasury stock			Unearned ESOP		Additional paid-in capital		Retained ‎earnings		Accumulated ‎other ‎comprehensive ‎earnings (loss)		Total equity
Balance, January 1, 2022	$	35,000	$	(3,155,399)		$	(2,343,745)	$	32,965,136	$	44,282,895	$	2,920,027	$	74,703,914
Purchase of treasury stock		—		(25,574)			—		—		—		—		(25,574)
Net loss		—		—			—		—		(160,140)		—		(160,140)
Other comprehensive loss, net of tax		—		—			—		—		—		(4,969,069)		(4,969,069)
Restricted stock unit expense		—		58,481	¹		—		(13,977)		—		—		44,504
ESOP compensation expense		—		—			57,790		38,804		—		—		96,594
Balance, March 31, 2022	$	35,000	$	(3,122,492)		$	(2,285,955)	$	32,989,963	$	44,122,755	$	(2,049,042)	$	69,690,229

¹Amount represents restricted stock units that have fully vested in the period.

See accompanying notes to consolidated financial statements.

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Table of Contents

ICC Holdings, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)



	Three-Month Periods Ended March 31,
	2022		2021
Cash flows from operating activities:
Net (loss) earnings	$	(160,140)	$	1,161,941
Adjustments to reconcile net (loss) earnings to net cash (used in) provided by operating activities
Net realized investment gains		(207,585)		(186,709)
Net unrealized losses (gains) on equity securities		1,292,692		(876,316)
Depreciation		159,695		159,680
Deferred income tax		(234,026)		271,546
Amortization of bond premium and discount		62,566		67,997
Stock-based compensation expense		141,098		120,866
Change in:
Accrued investment income		(67,148)		(39,360)
Premiums and reinsurance balances receivable		(210,325)		908,120
Ceded unearned premiums		19,022		(1,009)
Reinsurance balances payable		(864,638)		(23,689)
Reinsurance balances recoverable		(1,567,475)		(991,294)
Deferred policy acquisition costs		(617,926)		(291,657)
Unpaid losses and settlement expenses		5,572,567		232,302
Unearned premiums		1,296,802		679,060
Accrued expenses		(1,266,826)		(450,758)
Current federal income tax		163,924		34,078
Other		(118,260)		(292,181)
Net cash provided by operating activities		3,394,017		482,617
Cash flows from investing activities:
Purchases of:
Fixed maturity securities, available-for-sale		(4,818,111)		(2,494,500)
Common stocks		(709,822)		(3,310,389)
Preferred stocks		(651,918)		(81,953)
Other invested assets		(100,000)		—
Property held for investment		(402,375)		(30,018)
Property and equipment		(170,989)		(80,497)
Proceeds from sales, maturities and calls of:
Fixed maturity securities, available-for-sale		2,445,125		3,484,432
Common stocks		636,104		687,015
Preferred stocks		365,508		78,469
Other invested assets		9,209		—
Property held for investment		—		243,588
Property and equipment		5,789		1,007
Net cash used in investing activities		(3,391,480)