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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended March 31, 2026

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

Commission File Number: 001-33992

KINGSTONE COMPANIES, INC.
(Exact name of registrant as specified in its charter)

DE80-0033992
(State or other jurisdiction of incorporation or organization)(IRS Employer Identification No.)

100 Innovation Drive, Suite 400, Wilmington, DE, 19801
(Address of principal executive offices, including zip code)

(302) 555-0192
(Registrant's telephone number, including area code)

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

Title of each classTrading symbolName of each exchange on which registered
Common StockKINSNASDAQ

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 ☐    Smaller reporting company    Emerging growth company

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

As of March 31, 2026, the registrant had 14,476,133 shares of common stock outstanding.


KINGSTONE COMPANIES, INC.

Form type: 10-Q

Period end: 2026-03-31

Financial statements

Income Statement
Three Months Ended March 31, 2026Three Months Ended March 31, 2025
Commission revenue1,276,750.003,252,404.00
Net gains (losses) on investments-1,015,347.00-137,979.00
Net investment income3,337,581.002,048,596.00
Net premiums earned55,868,814.0043,523,063.00
Other revenue307,938.001,812,691.00
Total Revenue59,775,736.0050,498,775.00
Total COGS0.000.00
Gross Profit59,775,736.0050,498,775.00
Commission expense10,195,412.009,312,880.00
Interest expense, operating69,855.00227,454.00
Other operating costs2,260,547.001,035,737.00
Other operating expenses46,289,891.0027,798,941.00
Other underwriting expenses8,361,273.007,405,422.00
Total Expenses67,176,978.0045,780,434.00
Operating income-7,401,242.004,718,341.00
Income before income taxes-7,401,242.004,718,341.00
Income tax expense (benefit)-1,592,992.00835,681.00
Net Income-5,808,250.003,882,660.00
Basic earnings per share-0.40
Diluted earnings per share-0.40
Weighted average shares outstanding, basic14,453,747
Weighted average shares outstanding, diluted14,453,747
Statements of Comprehensive Income
Three Months Ended March 31, 2026Three Months Ended March 31, 2025
Net income-5,808,250.003,882,660.00
Other comprehensive income (loss), net of tax-2,055,257.002,223,186.00
Comprehensive income-7,863,507.006,105,846.00
Balance Sheet
March 31, 2026December 31, 2025
Assets
Debt securities available for sale293,800,426.00289,037,190.00
Debt securities held to maturity6,041,016.006,042,348.00
Deferred policy acquisition costs27,799,748.0027,867,207.00
Deferred tax assets6,318,887.004,179,559.00
Intangible assets, net500,000.00500,000.00
Finite-lived intangible assets, accumulated amortization4,350,000.00
Operating lease right-of-use assets128,036.00136,209.00
Other assets (derived)15,821,149.0034,590,523.00
Other invested assets9,839,800.0010,056,595.00
Other investments3,756,749.004,552,378.00
Premiums receivable19,027,968.0021,012,408.00
Prepaid reinsurance premiums4,934,974.002,142,329.00
Property, plant and equipment8,017,975.007,897,675.00
Reinsurance recoverables57,996,924.0033,232,000.00
Restricted cash and equivalents11,355,391.0012,178,730.00
Total Assets465,339,043.00453,425,151.00
Liabilities
Accounts payable and accrued liabilities4,984,969.0011,253,649.00
Debt, current1,315,984.004,440,127.00
Deposits0.00765,172.00
Long-term debt2,806,987.003,143,227.00
Operating lease liabilities, current128,036.00136,209.00
Other liabilities (derived)16,207,164.0016,388,828.00
Unearned premiums153,642,731.00154,028,072.00
Unpaid claims and claims adjustment expenses171,748,662.00140,538,618.00
Total Liabilities350,834,533.00330,693,902.00
Equity
Preferred stock00
Preferred stock, par value per share0.010.01
Preferred stock, shares authorized2,500,0002,500,000
Preferred stock, shares issued00
Accumulated other comprehensive income (loss)-8,136,787.00-6,081,530.00
Common stock160,066.00159,216.00
Common stock, par value per share0.010.01
Common stock, shares authorized20,000,00020,000,000
Common stock, shares issued16,006,72815,921,651
Common stock, shares outstanding14,482,60314,397,526
Other stockholders equity (derived)99,982,907.0099,624,713.00
Retained earnings (accumulated deficit)28,066,331.0034,596,857.00
Treasury stock, at cost-5,568,007.00-5,568,007.00
Treasury stock, common shares held1,524,1251,524,125
Total Equity114,504,510.00122,731,249.00
Total liabilities and equity465,339,043.00453,425,151.00
Statement of Cash Flows
Three Months Ended March 31, 2026Three Months Ended March 31, 2025
Operating activities
Net income-5,808,250.003,882,660.00
Depreciation and amortization715,507.00623,863.00
Stock-based compensation653,984.00339,010.00
Deferred income taxes-1,592,992.00-125,822.00
Change in income taxes payable9,077.001,350,342.00
Change in other operating assets-6,987,398.00303,613.00
Change in contract liabilities-5,544,085.00-4,456,192.00
Change in accounts payable and accrued liabilities-6,268,680.001,397,437.00
Changes in operating assets and liabilities, net33,537,323.0014,542,396.00
Net cash from operating activities8,714,486.0017,857,307.00
Investing activities
Purchases of property and equipment-835,807.00-863,468.00
Other investing activities (derived)-7,367,646.00-10,980,599.00
Net cash from investing activities-8,203,453.00-11,844,067.00
Financing activities
Dividends paid-722,276.000.00
Proceeds from exercise of stock options41,249.0056,149.00
Proceeds from issuance of common stock0.009,545,692.00
Other financing activities (derived)-653,345.00-6,794,340.00
Net cash from financing activities-1,334,372.002,807,501.00
Net change in cash-823,339.008,820,741.00
Cash at beginning of period12,178,730.0028,669,441.00
Cash at end of period11,355,391.0037,490,182.00
Supplemental cash flow information
Cash paid for interest63,476.001,370,448.00
Cash paid for income taxes0.000.00
Cash paid for income taxes, state and local0.000.00
Statement of Stockholders' Equity
Common stockRetained earnings (accumulated deficit)Accumulated other comprehensive income (loss)Treasury stock, at costOther stockholders equity (derived)Total
Balance at December 31, 2024144,482.00-4,755,874.00-12,175,476.00-5,568,007.0089,063,326.0066,708,451.00
Net income3,882,660.003,882,660.00
Other equity movements8,352.000.002,223,186.000.009,387,314.0011,618,852.00
Balance at March 31, 2025152,834.00-873,214.00-9,952,290.00-5,568,007.0098,450,640.0082,209,963.00
Balance at December 31, 2025159,216.0034,596,857.00-6,081,530.00-5,568,007.0099,624,713.00122,731,249.00
Net income-5,808,250.00-5,808,250.00
Dividends-722,276.00-722,276.00
Other equity movements850.000.00-2,055,257.000.00358,194.00-1,696,213.00
Balance at March 31, 2026160,066.0028,066,331.00-8,136,787.00-5,568,007.0099,982,907.00114,504,510.00

Notes to financial statements

Notes to financial statements

Kingstone Companies, Inc. is a public reporting company operating in the fire, marine and casualty insurance industry, and its executive offices are located in Kingston, New York. The accompanying unaudited condensed financial statements of the Company as of and for the period ended March 31, 2026 have been prepared from the Company's connected books and records, and the results of operations for this interim period are not necessarily indicative of the results that may be expected for the full year. In the opinion of management, the interim statements reflect all adjustments necessary for a fair presentation of the periods presented, and they should be read in conjunction with the Company's audited annual financial statements. The Company's primary market risk exposure is interest rate risk on cash, cash equivalents and short-term investments, and the Company does not have material foreign currency or commodity price exposure. The Company is involved in legal proceedings arising in the ordinary course of business from time to time, and management does not currently believe any pending matter is material to the financial statements.

Total revenue for the period ended March 31, 2026 was $59,775,736. Net premiums earned were $55,868,814, compared with $43,523,063 in the comparative period, an increase of 28.4%, and net investment income was $3,337,581, compared with $2,048,596, an increase of 62.9%. Commission revenue was $1,276,750, compared with $3,252,404, a decrease of 60.7%, and other revenue was $307,938, compared with $1,812,691, a decrease of 83.0%. The Company recorded net losses on investments of $1,015,347, compared with net losses of $137,979 in the comparative period. Unearned premiums totaled $153,642,731 at March 31, 2026, compared with $132,231,352, an increase of 16.2%, and premiums receivable were $19,027,968, compared with $17,012,840, an increase of 11.8%. Deferred policy acquisition costs were $27,799,748, compared with $24,400,992, an increase of 13.9%. The Company reported a net loss of $5,808,250 for the period, and recognized an income tax benefit of $1,592,992, all of which was deferred, compared with income tax expense of $835,681 in the comparative period.

Basic and diluted loss per share were each $0.40 for the period ended March 31, 2026, based on weighted-average basic shares outstanding of 14,453,747, with no dilutive adjustment to the share count because the effect of potentially dilutive securities would have been anti-dilutive. At March 31, 2026, the Company's debt consisted of current debt of $1,315,984 and long-term debt of $2,806,987, and the Company had no deposits outstanding. Current debt increased 6.0% from $1,241,294 in the comparative period, while long-term debt decreased 31.9% from $4,122,971. Interest expense was $69,855 for the period, compared with $227,454 in the comparative period, a decrease of 69.3%. The Company's operating lease liabilities, all of which are current, totaled $128,036 at March 31, 2026, and operating lease cost, which represented total lease cost for the period, was $13,391; no right-of-use assets were obtained in exchange for operating lease liabilities during the period. Operating lease right-of-use assets were $128,036, compared with $193,545 in the comparative period, a decrease of 33.8%. Total liabilities were $350,834,533 at March 31, 2026, including unpaid claims and claims adjustment expenses of $171,748,662, compared with $135,334,723, an increase of 26.9%, and accounts payable and accrued liabilities of $4,984,969, compared with $11,967,825, a decrease of 58.3%.

Total stockholders' equity was $114,504,510 at March 31, 2026. Stockholders' equity consisted of common stock of $160,066, other stockholders' equity of $99,982,907, retained earnings of $28,066,331, accumulated other comprehensive loss of $8,136,787 and treasury stock, at cost, of $5,568,007. Common stock increased 4.7% from $152,834 in the comparative period, and other stockholders' equity increased 1.6% from $98,450,640. Retained earnings of $28,066,331 compared with an accumulated deficit of $873,214 in the comparative period. Accumulated other comprehensive loss improved to $8,136,787 from $9,952,290, reflecting a change of 18.2%, and treasury stock, at cost, was unchanged at $5,568,007. [COMPLETE: description of common stock issuances, dividends and other equity transactions during the period, if any].

Summary of significant accounting policies

Basis of presentation

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and the applicable rules and regulations of the Securities and Exchange Commission. In the opinion of management, the financial statements reflect all adjustments necessary for a fair statement of the financial position, results of operations, and cash flows for the periods presented.

Principles of consolidation

The financial statements include the accounts of the Company and its consolidated subsidiaries, if any. All intercompany balances and transactions have been eliminated in consolidation.

Property and equipment

Property and equipment are stated at cost less accumulated depreciation. Depreciation is recognized over the estimated useful lives of the related assets, generally on a straight-line basis. Expenditures for maintenance and repairs are expensed as incurred.

Impairment of long-lived assets

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. When the carrying amount of an asset or asset group is not recoverable, an impairment loss is recognized for the amount by which the carrying amount exceeds fair value.

Leases

The Company determines whether an arrangement is or contains a lease at inception. For leases with terms greater than twelve months, a right-of-use asset and a corresponding lease liability are recognized at the lease commencement date, measured at the present value of the remaining lease payments over the lease term.

Debt

Debt is carried at amortized cost. Debt issuance costs and discounts or premiums are presented as an adjustment to the carrying amount of the related debt and amortized to interest expense over the contractual term of the debt.

Income taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, measured using enacted tax rates expected to apply in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is recognized when it is more likely than not that some portion of the deferred tax assets will not be realized.

Earnings per share

Basic earnings per share is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted into common stock, except when the effect would be antidilutive.

Stockholders' equity

Equity instruments issued by the Company are classified in stockholders' equity based on their terms. The components of stockholders' equity and the changes in those components for the periods presented are set forth in the equity note.

Recent accounting pronouncements

The Company evaluates the applicability and impact of Accounting Standards Updates issued by the Financial Accounting Standards Board as they are issued. Adopted updates and updates not yet effective are not expected to have a material effect on the financial statements, except as otherwise described in these notes.

Debt
CurrentPrior
Debt, current1,315,984.004,440,127.00
Deposits0.00765,172.00
Long-term debt2,806,987.003,143,227.00
Operating lease liabilities, current128,036.00136,209.00
Total debt4,251,007.008,484,735.00
Property and equipment
CurrentPrior
Property, plant and equipment8,017,975.007,897,675.00
Total property and equipment8,017,975.007,897,675.00
Finite-lived intangible assets
CurrentPrior
Net carrying amount500,000.00500,000.00
Stockholders' equity
CurrentPrior
Accumulated other comprehensive income (loss)-8,136,787.00-6,081,530.00
Common stock160,066.00159,216.00
Other stockholders equity (derived)99,982,907.0099,624,713.00
Retained earnings (accumulated deficit)28,066,331.0034,596,857.00
Treasury stock, at cost-5,568,007.00-5,568,007.00
Total stockholders' equity114,504,510.00122,731,249.00
Earnings per share
CurrentPrior
Weighted average shares outstanding, basic14,453,74713,472,404
Dilutive effect of potential common shares0188,679
Weighted average shares outstanding, diluted14,453,74714,272,502
Basic earnings per share-0.400.29
Diluted earnings per share-0.400.27
Lease cost and other lease information
CurrentPrior
Operating lease cost13,391.004,464.00
Total lease cost13,391.004,464.00
Right-of-use assets obtained in exchange for operating lease liabilities0.00198,042.00
Components of income tax expense
Amount
Total deferred(1,592,992.00)
Total income tax expense (benefit)(1,592,992.00)
Deferred tax assets and liabilities
CurrentPrior
Deferred tax assets, gross13,143,838.0010,995,146.00
Operating loss carryforwards1,324,828.000.00
Other deferred tax assets846,136.00916,350.00
Valuation allowance3,484,099.003,421,252.00
Tax credit carryforwards1,324,828.000.00
Deferred income5,940,838.004,948,868.00
Unrealized losses on trading securities2,570,317.001,811,373.00
Operating loss carryforwards, pre-tax53,601,524.0052,634,646.00
Deferred income tax liabilities6,824,951.006,815,587.00
Property and equipment122,461.0098,931.00
Intangible assets105,000.00105,000.00
Investments759,543.00759,543.00
Deferred expenses5,837,947.005,852,113.00
Supplemental income statement information
CurrentPrior
Depreciation and amortization715,507.00623,863.00

Management's discussion and analysis

Management's discussion and analysis

Kingstone Companies, Inc. is a public reporting company classified under Fire, Marine & Casualty Insurance. For the quarter ended March 31, 2026, we reported total revenue of $59,775,736 and a net loss of $5,808,250. The net loss represented basic loss per share of $0.40 on weighted-average basic shares outstanding of 14,453,747. The following discussion compares our results of operations for the quarter to the comparable prior-year period and should be read together with our condensed consolidated financial statements and the related notes.

Net premiums earned, our largest revenue component, increased 28.4% to $55,868,814 from $43,523,063 in the prior-year period. Growth in the book of business was also reflected on the balance sheet, where unearned premiums increased 16.2% to $153,642,731 from $132,231,352 and premiums receivable increased 11.8% to $19,027,968 from $17,012,840. Net investment income increased 62.9% to $3,337,581 from $2,048,596, consistent with the expansion of our portfolio of debt securities available for sale to $293,800,426 from $204,282,369. These increases were partially offset by a 60.7% decline in commission revenue to $1,276,750 from $3,252,404, an 83.0% decline in other revenue to $307,938 from $1,812,691, and net losses on investments of $1,015,347 compared with net losses of $137,979 in the prior-year period.

Other operating expenses increased 66.5% to $46,289,891 from $27,798,941, representing the most significant driver of the increase in total expenses, while the liability for unpaid claims and claims adjustment expenses increased 26.9% to $171,748,662 from $135,334,723. Commission expense increased 9.5% to $10,195,412 from $9,312,880, other underwriting expenses increased 12.9% to $8,361,273 from $7,405,422, and other operating costs increased 118.3% to $2,260,547 from $1,035,737. Deferred policy acquisition costs increased 13.9% to $27,799,748 from $24,400,992 in connection with the growth in premiums written. Interest expense decreased 69.3% to $69,855 from $227,454, reflecting the reduction of long-term debt to $2,806,987 from $4,122,971. We recorded an income tax benefit of $1,592,992 for the quarter compared with income tax expense of $835,681 in the prior-year period, and deferred tax assets increased to $6,318,887 from $5,132,770.

Our principal sources of liquidity are premiums collected, investment income, and proceeds from the sale and maturity of investments, and our principal uses are the payment of claims, operating expenses, and debt service. Cash and cash equivalents at March 31, 2026 were [COMPLETE: cash and cash equivalents balance and comparison to prior period]. Restricted cash and equivalents decreased 69.7% to $11,355,391 from $37,490,182, while accounts payable and accrued liabilities decreased 58.3% to $4,984,969 from $11,967,825. At quarter-end, our investment portfolio consisted of debt securities available for sale of $293,800,426, debt securities held to maturity of $6,041,016, other invested assets of $9,839,800, and other investments of $3,756,749. Reinsurance recoverables were $57,996,924 compared with $60,818,148, and prepaid reinsurance premiums were $4,934,974 compared with none in the prior-year period. Our outstanding indebtedness consisted of current debt of $1,315,984, long-term debt of $2,806,987, and current operating lease liabilities of $128,036. Total liabilities were $350,834,533 and total stockholders' equity was $114,504,510 at March 31, 2026. Accumulated other comprehensive loss narrowed to $8,136,787 from $9,952,290, and treasury stock remained unchanged at $5,568,007. Our primary market risk exposure is interest rate risk on cash, cash equivalents, and short-term investments, and we do not have material foreign currency or commodity price exposure. Management believes that our existing cash, investment portfolio, and cash flows from operations will be sufficient to meet our liquidity needs for at least the next twelve months [COMPLETE: confirm management's assessment of liquidity sufficiency and any planned capital actions].

Quantitative and qualitative disclosures about market risk

Quantitative and qualitative disclosures about market risk

Our primary market risk exposure is interest rate risk on cash, cash equivalents, and short-term investments. Primary market risk exposure is interest rate risk on cash, cash equivalents, and short-term investments. The company does not have material foreign currency or commodity price exposure. Market risk represents the potential for loss arising from adverse changes in market prices and rates, and we manage this exposure principally through the composition and duration of our investment portfolio. KINGSTONE COMPANIES, INC. is a public reporting company classified under Fire, Marine & Casualty Insurance, and our investment portfolio is held to support the payment of policyholder obligations, including Unpaid claims and claims adjustment expenses of $171,748,662 and Unearned premiums of $153,642,731 at March 31, 2026.

Changes in interest rates directly affect the fair value of our fixed-income securities, with rising rates generally reducing fair value and declining rates generally increasing it. At March 31, 2026, Debt securities available for sale were $293,800,426 compared with $204,282,369 in the prior period, an increase of 43.8%, and Debt securities held to maturity were $6,041,016 compared with $7,046,023, a decrease of 14.3%. We also held Other invested assets of $9,839,800 and Other investments of $3,756,749, along with Restricted cash and equivalents of $11,355,391 compared with $37,490,182 in the prior period. Reflecting the larger fixed-income portfolio and prevailing yields, Net investment income was $3,337,581 for the period compared with $2,048,596 in the prior period, an increase of 62.9%. We recognized net losses on investments of $1,015,347 compared with net losses of $137,979 in the prior period. Unrealized changes in the fair value of our available-for-sale portfolio are reflected in stockholders' equity, and our accumulated other comprehensive loss was $8,136,787 at March 31, 2026 compared with $9,952,290 in the prior period. [COMPLETE: table quantifying the estimated change in fair value of the fixed-income portfolio under hypothetical parallel shifts in interest rates of 100 and 200 basis points]

Our borrowings expose us to a more limited degree of interest rate risk. At March 31, 2026, current debt was $1,315,984 compared with $1,241,294 in the prior period, and long-term debt was $2,806,987 compared with $4,122,971, a decrease of 31.9%. Interest expense was $69,855 for the period compared with $227,454 in the prior period, a decrease of 69.3%. [COMPLETE: description of the fixed or variable rate terms of outstanding borrowings and the estimated effect of a change in market interest rates on interest expense] We do not use derivative financial instruments for trading or speculative purposes, and we will continue to monitor our interest rate exposure and adjust our portfolio as market conditions and our liability profile warrant.

Controls and procedures

Controls and procedures

Kingstone Companies, Inc. maintains disclosure controls and procedures designed to ensure that information required to be disclosed in the reports it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to management, including [COMPLETE: titles of the principal executive officer and principal financial officer], to allow timely decisions regarding required disclosure. Management evaluated the effectiveness of the Company's disclosure controls and procedures as of the end of the period covered by this report and concluded that they were effective at the reasonable assurance level. This evaluation was performed as of March 31, 2026, the end of the quarter covered by this quarterly report.

There were no changes in the Company's internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, its internal control over financial reporting. Management continues to monitor the design and operation of its controls and will report any future changes that meet this threshold in the period in which they occur.

Management recognizes that any system of controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that its objectives will be met, and that the design of any control system must reflect resource constraints and judgments about the likelihood of future events. [COMPLETE: Management must review and formally adopt the conclusion language above, including the effectiveness determination and the statement regarding changes in internal control over financial reporting, before this report is filed.]

Legal proceedings

Legal proceedings

Kingstone Companies, Inc. is a public reporting company classified under Fire, Marine & Casualty Insurance, and in the ordinary course of conducting that business, the Company is involved in legal proceedings arising in the ordinary course of business from time to time. Such matters may include claims-related litigation and other disputes that are incidental to the operation of a property and casualty insurance business.

Management does not currently believe any pending matter is material to the financial statements. The Company evaluates the status of pending matters on an ongoing basis and records accruals when a loss is considered probable and reasonably estimable in accordance with applicable accounting guidance. The outcome of litigation is inherently uncertain, and there can be no assurance that the ultimate resolution of any pending or future matter will not have an adverse effect on the Company's results of operations or cash flows in a particular reporting period.

As of March 31, 2026, the Company was not a party to any legal proceedings that management considers material to its financial condition or results of operations. The Company is involved in legal proceedings arising in the ordinary course of business from time to time, and management does not currently believe any pending matter is material to the financial statements.

Risk factors

Risk factors

Our business and financial results are subject to a number of risks and uncertainties, and the risk factors described in our Annual Report on Form 10-K for the fiscal year ended [COMPLETE: fiscal year end date of the most recent Annual Report on Form 10-K] should be read together with the information below. KINGSTONE COMPANIES, INC. is a public reporting company classified under Fire, Marine & Casualty Insurance, and as a property and casualty insurer our results depend heavily on the adequacy of our pricing and reserving, the frequency and severity of insured losses, and the availability and cost of reinsurance. For the period ended March 31, 2026, we reported revenue of $59,775,736 and a net loss of $5,808,250, and there can be no assurance that we will return to profitability in future periods.

Our exposure to underwriting and claims risk has grown with the size of our book of business. Net premiums earned increased to $55,868,814 from $43,523,063 in the prior period, an increase of 28.4%, while unearned premiums rose 16.2% to $153,642,731, and any inadequacy in the rates we charge on this larger volume of business would be reflected in future underwriting results. Our liability for unpaid claims and claims adjustment expenses increased 26.9% to $171,748,662 from $135,334,723, and if actual losses develop unfavorably relative to these estimates we would be required to increase reserves, which would reduce earnings and stockholders' equity. We also rely on reinsurance, with reinsurance recoverables of $57,996,924 and prepaid reinsurance premiums of $4,934,974 as of the end of the period, and the failure of a reinsurer to meet its obligations, or an increase in the cost or reduction in the availability of reinsurance, could adversely affect our results. Other operating expenses increased 66.5% to $46,289,891 from $27,798,941, and other operating costs increased 118.3% to $2,260,547, and continued growth in our expense base that is not matched by premium growth would further pressure our margins.

Our investment portfolio exposes us to market risk. Our primary market risk exposure is interest rate risk on cash, cash equivalents, and short-term investments, and we do not have material foreign currency or commodity price exposure. Debt securities available for sale increased 43.8% to $293,800,426 from $204,282,369, and changes in interest rates or credit spreads could result in unrealized losses that reduce our accumulated other comprehensive income and stockholders' equity. We recognized net losses on investments of $1,015,347 in the current period compared with net losses of $137,979 in the prior period, while net investment income increased 62.9% to $3,337,581, and future investment results may be volatile and may not offset underwriting losses.

Our liquidity, capital position, and regulatory standing are also subject to risk. Restricted cash and equivalents declined 69.7% to $11,355,391 from $37,490,182, and total liabilities of $350,834,533 compared with total equity of $114,504,510 as of the end of the period, and a deterioration in our capital position could limit our ability to write new business or satisfy regulatory capital requirements. We had long-term debt of $2,806,987 and current debt of $1,315,984, and our ability to service or refinance these obligations depends on our operating cash flows and access to capital markets. We are involved in legal proceedings arising in the ordinary course of business from time to time, and although management does not currently believe any pending matter is material to the financial statements, an adverse outcome in litigation could have a material adverse effect on our results. Management evaluated our disclosure controls and procedures as of the end of the period and concluded they were effective at the reasonable assurance level, and no changes materially affected internal control over financial reporting during the quarter; however, any future failure to maintain effective controls could impair our ability to report our financial results accurately and on a timely basis.

Other information

Other information

The following information is provided by Kingstone Companies, Inc. with respect to the quarterly period ended March 31, 2026. The company is involved in legal proceedings arising in the ordinary course of business from time to time, and management does not currently believe any pending matter is material to the financial statements.

Pursuant to Item 408(a) of Regulation S-K, the company discloses below the adoption and termination of Rule 10b5-1 trading arrangements by its directors and officers during the quarter. [COMPLETE: Rule 10b5-1 trading arrangement adoptions and terminations from the D&O questionnaires]