Oxbridge Re Q3 2026 loss widens to $421K
SurancePlus's HCI 2026 Series placement had $6.3 million in gross proceeds, while AI GridWorks became a direct 80%-owned subsidiary.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Oxbridge Re Holdings Limited (OXBR) reported third-quarter 2026 total revenue of $261,000, versus $645,000 a year earlier, and a net loss attributable to ordinary shareholders of $421,000, versus $187,000. For the first nine months of 2026, total revenue was $1.823 million, compared with $2.001 million, while net loss attributable to ordinary shareholders narrowed to $223,000 from $2.199 million. Net cash used in operating activities was $374,000; cash and restricted cash totaled $19.565 million at September 30, 2026.
In June, subsidiary SurancePlus completed the HCI 2026 Series placement of 300,000 tokenized interests for $6.3 million in gross proceeds. HCI deposited $6.19 million of additional collateral, and Oxbridge deposited $5.8 million of net proceeds into Series Trust Accounts. The interests are contractual rights, not equity securities or shares of SurancePlus. AI GridWorks became a direct 80%-owned subsidiary during the quarter and began development-stage activities. During the nine months, OXBR sold 337,203 ordinary shares under its at-the-market program for $413,000 in gross proceeds.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointNine-month net loss: $223,000, versus $2.199 million a year earlier.
Negative
- Moderate pointThird-quarter total revenue: $261,000, versus $645,000 a year earlier.
- Moderate pointThird-quarter net loss: $421,000, versus $187,000 a year earlier.
- Moderate pointNine-month total revenue: $1.823 million, versus $2.001 million.
Filing Explained
Warrants remain a possible source of new shares: 8,230,700 could each become one ordinary share at $7.50, with none exercised in the nine months.
In this unaudited third-quarter report, Oxbridge Re lists
The HCI 2026 Series tokens are carried as
At
Key Figures
Key Terms
mezzanine equity financial
participating notes financial
anti-dilutive financial
quota share financial
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How did OXBR's third-quarter 2026 results compare with last year?
What were the terms of OXBR's HCI 2026 Series token placement?
What data-center capacity is AI GridWorks planning?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the quarterly period ended
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from __________ to __________
Commission
File Number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s
telephone number, including area code:
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.
| ☒ | No | ☐ |
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).
| ☒ | No | ☐ |
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |
| ☐ | Smaller reporting company | |||
| Emerging growth company |
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 |
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
As
of November 9, 2026;
OXBRIDGE RE HOLDINGS LIMITED
INDEX
| Page | ||
| PART I – FINANCIAL INFORMATION | ||
| Item 1. | Financial Statements | 3 |
| Consolidated Balance Sheets September 30, 2026 (unaudited) and December 31, 2025 | 3 | |
| Consolidated Statements of Operations Three Months and Nine Months Ended September 30, 2026 and 2025 (unaudited) | 4 | |
| Consolidated Statements of Cash Flows Nine-Months Ended September 30, 2026 and 2025 (unaudited) | 5 | |
| Consolidated Statements of Changes in Shareholders’ Equity Three and Nine Months Ended September 30, 2026 and 2025 (unaudited) | 6 | |
| Notes to the Consolidated Financial Statements (unaudited) | 7 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 24 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 34 |
| Item 4. | Controls and Procedures | 34 |
| PART II – OTHER INFORMATION | ||
| Item 1. | Legal Proceedings | 35 |
| Item 1A. | Risk Factors | 35 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 35 |
| Item 3. | Defaults Upon Senior Securities | 35 |
| Item 4. | Mine Safety Disclosures | 35 |
| Item 5. | Other Information | 35 |
| Item 6. | Exhibits | 35 |
| Signatures | 36 | |
| 2 |
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Balance Sheets
(expressed in thousands of U.S. Dollars, except per share and share amounts)
At September 30, 2026 | At December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Restricted cash and cash equivalents (Cat Re token program) | ||||||||
| Restricted cash and cash equivalents (HCI 2026 token program) | - | |||||||
| Restricted cash and cash equivalents | - | |||||||
| Premiums receivable | ||||||||
| Other Assets | - | |||||||
| Deferred policy acquisition costs | ||||||||
| Operating lease right-of-use assets | ||||||||
| Prepayment and other assets | ||||||||
| Property and equipment, net | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and Shareholders’ Equity | ||||||||
| Liabilities: | ||||||||
| Reserve for losses and loss adjustment expenses | ||||||||
| Notes payable to noteholders | ||||||||
| Premium payable | - | |||||||
| Unearned premiums reserve | ||||||||
| Losses payable | ||||||||
| Operating lease liabilities | ||||||||
| Accounts payable and other liabilities | ||||||||
| Total liabilities | ||||||||
| Mezzanine Equity | ||||||||
| Due to Cat Re / T20 / T42 tokenholders | ||||||||
| - | ||||||||
| - | ||||||||
| - | ||||||||
| Total Mezzanine equity | ||||||||
| Shareholders’ equity: | ||||||||
| Ordinary share capital, (par value $ | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated Deficit | ( | ) | ( | ) | ||||
| Total Oxbridge shareholders’ equity | ||||||||
| Non-controlling interests | ||||||||
| Total shareholders’ equity | ||||||||
| Total liabilities, mezzanine and shareholders’ equity | $ | $ | ||||||
The accompanying Notes to Consolidated Financial Statements are an integral part of the Consolidated Financial Statements.
| 3 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Statements of Operations
(Unaudited)
(expressed in thousands of U.S. Dollars, except per share amounts)
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue | ||||||||||||||||
| Assumed premiums | $ | - | $ | - | $ | $ | ||||||||||
| Change in unearned premiums reserve | ( | ) | ||||||||||||||
| Net premiums earned | ||||||||||||||||
| SurancePlus management fee income | - | - | ||||||||||||||
| Net investment and other income | ||||||||||||||||
| Realized gain on other investments | - | - | - | |||||||||||||
| Unrealized loss on other investments | - | - | - | ( | ) | |||||||||||
| Change in fair value of equity securities | - | - | ||||||||||||||
| Total revenue | ||||||||||||||||
| Expenses | ||||||||||||||||
| Losses and loss adjustment expenses | - | - | - | |||||||||||||
| Policy acquisition costs and underwriting expenses | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Total expenses | ||||||||||||||||
| (Loss) before income / loss attributable to tokenholders and non-controlling interests | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| (Income) loss attributable to tokenholders | ( | ) | ( | ) | ( | ) | ||||||||||
| (Loss) before (income) loss attributable to non-controlling interests | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| (Income) loss attributable to non-controlling interests | ( | ) | ( | ) | ( | ) | ||||||||||
| Net loss attributable to ordinary shareholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Loss per share attributable to ordinary shareholders | ||||||||||||||||
| Basic and Diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Weighted-average shares outstanding | ||||||||||||||||
| Basic and Diluted | ||||||||||||||||
The accompanying Notes to Consolidated Financial Statements are an integral part of the Consolidated Financial Statements.
| 4 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited)
(expressed in thousands of U.S. Dollars)
| 2026 | 2025 | |||||||
| Nine Months Ended | ||||||||
| September 30, | ||||||||
| 2026 | 2025 | |||||||
| Operating activities | ||||||||
| Net loss attributable to ordinary shareholders | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Share-based compensation | ||||||||
| Realized gain on other investments | - | ( | ) | |||||
| SurancePlus management fee income | ( | ) | ( | ) | ||||
| Depreciation and amortization | - | |||||||
| Change in fair value of other investments | - | |||||||
| Change in fair value of equity securities | - | ( | ) | |||||
| Income (loss) attributable to non-controlling interests | ( | ) | ||||||
| Change in operating assets and liabilities: | ||||||||
| Operating right-of-use asset | ( | ) | ||||||
| Operating lease liabilities | ( | ) | ||||||
| Premiums receivable | ( | ) | ||||||
| Deferred policy acquisition costs | ( | ) | ||||||
| Other assets | ( | ) | - | |||||
| Prepayment and other assets | ( | ) | ||||||
| Premium payable | - | |||||||
| Unearned premiums reserve | ( | ) | ||||||
| Accounts payable and other liabilities | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Investing activities | ||||||||
| Proceeds from sale of other investments | - | |||||||
| Net cash provided by investing activities | - | |||||||
| Financing activities | ||||||||
| Proceeds from issuance (redemption) of Tokenholders | ( | ) | ||||||
| Proceeds from issuance of ordinary shares | ||||||||
| Proceeds from issuance of HCI 2026 Series A, B & C Tokens | - | |||||||
| Proceeds from HCI Additional Collateral Deposit | - | |||||||
| Net cash provided by financing activities | ||||||||
| Cash and cash equivalents, and restricted cash and cash equivalents: | ||||||||
| Net change during the period | ||||||||
| Balance at beginning of period | ||||||||
| Balance at end of period | $ | $ | ||||||
| Non-cash investing and financing activities | ||||||||
| Right-of-use lease asset obtained in exchange for operating lease liabilities | $ | $ | - | |||||
| Reclassification of contributed non-controlling interest | ||||||||
| Reclassification of other liabilities EpsilonCat Re / DeltaCat Re | - | |||||||
| Remeasurement of carrying value of HCI 2026 Series tokens | - | |||||||
The accompanying Notes to Consolidated Financial Statements are an integral part of the Consolidated Financial Statements.
| 5 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Statements of Changes in Shareholders’ Equity (unaudited)
Nine Months Ended September 30, 2026 and 2025
(expressed in thousands of U.S. Dollars, except share amounts)
| Shares | Amount | Capital | Deficit | Interests | Equity | |||||||||||||||||||
| Ordinary Share Capital | Additional Paid-in | Accumulated | Non-Controlling | Total Shareholders’ | ||||||||||||||||||||
| Shares | Amount | Capital | Deficit | Interests | Equity | |||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Net loss attributable to ordinary shareholders | - | - | - | ( | ) | - | ( | ) | ||||||||||||||||
| Income attributable to non-controlling interests | - | - | - | - | ||||||||||||||||||||
| Issuance of restricted stock, net | - | - | - | - | - | |||||||||||||||||||
| Issuance of ordinary shares | - | |||||||||||||||||||||||
| Issuance of shares upon exercise of options | ||||||||||||||||||||||||
| Share-based compensation | - | - | - | - | ||||||||||||||||||||
| Balance at March 31, 2025 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Net loss attributable to ordinary shareholders | - | - | - | ( | ) | - | ( | ) | ||||||||||||||||
| Loss attributable to non-controlling interests | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||
| Reclassification for contributed non-controlling interests | - | - | - | ( | ) | - | ||||||||||||||||||
| Share-based compensation | - | - | - | - | ||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Net loss attributable to ordinary shareholders | - | - | - | ( | ) | - | ( | ) | ||||||||||||||||
| Income attributable to non-controlling interests | - | - | - | - | ||||||||||||||||||||
| Issuance of ordinary shares | - | - | - | |||||||||||||||||||||
| Share-based compensation | - | - | - | |||||||||||||||||||||
| Balance at September 30,2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Net income attributable to ordinary shareholders | - | - | - | - | ||||||||||||||||||||
| Income attributable to non-controlling interests | - | - | - | - | ||||||||||||||||||||
| Issuance of restricted stock, net | - | - | - | - | - | |||||||||||||||||||
| Share-based compensation | - | - | - | - | ||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Net income attributable to ordinary shareholders | - | - | - | - | ||||||||||||||||||||
| Income attributable to non-controlling interests | - | - | - | - | ||||||||||||||||||||
| Reclassification for contributed non-controlling interests | - | - | - | ( | ) | - | ||||||||||||||||||
| Issuance of ordinary shares | - | - | - | |||||||||||||||||||||
| Share-based compensation | - | - | - | - | ||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Balance | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Net loss attributable to ordinary shareholders | - | - | - | ( | ) | - | ( | ) | ||||||||||||||||
| Net income/loss attributable to ordinary shareholders | - | - | - | ( | ) | - | ( | ) | ||||||||||||||||
| Income attributable to non-controlling interests | - | - | - | - | ||||||||||||||||||||
| Income/loss attributable to non-controlling interests | - | - | - | - | ||||||||||||||||||||
| Issuance of restricted stock, net | - | - | - | - | - | |||||||||||||||||||
| Issuance of ordinary shares | - | - | - | |||||||||||||||||||||
| Share-based compensation | - | - | - | - | ||||||||||||||||||||
| Remeasurement of carrying value of HCI 2026 Series tokens | - | - | - | ( | ) | - | ( | ) | ||||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Balance | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
The accompanying Notes to Consolidated Financial Statements are an integral part of the Consolidated Financial Statements.
| 6 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
1. ORGANIZATION AND BASIS OF PRESENTATION
(a) Organization
Oxbridge
Re Holdings Limited (the “Company”) was incorporated as an exempted company on April 4, 2013 under the laws of the Cayman
Islands. The Company directly owns
The Company’s headquarters and principal executive offices are located at Suite 201, 42 Edward Street, George Town, Grand Cayman, Cayman Islands, and have their registered offices at P.O. Box 309, Ugland House, Grand Cayman, Cayman Islands
The Company’s ordinary shares and warrants are listed on The NASDAQ Capital Market under the symbols “OXBR” and “OXBRW,” respectively.
(b) Basis of Presentation and Consolidation
The accompanying unaudited, consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information, and the Securities and Exchange Commission (“SEC”) rules for interim financial reporting. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations. However, in the opinion of management, the accompanying interim consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the Company’s consolidated financial position as of September 30, 2026 and the consolidated results of operations and cash flows for the periods presented. The consolidated results of operations for interim periods are not necessarily indicative of the results of operations to be expected for any subsequent interim period or for the fiscal year ended December 31, 2026. The accompanying unaudited consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2025 included in the Company’s Form 10-K, which was filed with the SEC on March 30, 2026.
Uses of Estimates: In preparing the interim unaudited consolidated financial statements, management was required to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures at the financial reporting date and throughout the periods being reported upon. Certain of the estimates result from judgments that can be subjective and complex and consequently actual results may differ from these estimates, which would be reflected in future periods.
Material estimates that are particularly susceptible to significant change in the near-term relate to the determination of the reserve for losses and loss adjustment expenses (if any), which may include amounts estimated for claims incurred but not yet reported. The Company uses various assumptions and actuarial data it believes to be reasonable under the circumstances to make these estimates. Although considerable variability is likely to be inherent in these estimates, management believes that the amounts provided are reasonable. These estimates are continually reviewed and adjusted if necessary. Such adjustments are reflected in current operations.
The Company consolidates in these consolidated financial statements the results of operations and financial position of all voting interest entities (“VOE”) in which the Company has a controlling financial interest and all variable interest entities (“VIE”) in which the Company is considered to be the primary beneficiary. The consolidation assessment, including the determination as to whether an entity qualifies as a VIE or VOE, depends on the facts and circumstances surrounding each entity.
All significant intercompany balances and transactions have been eliminated.
| 7 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
2. SIGNIFICANT ACCOUNTING POLICIES
Revenue Recognition: SurancePlus incentive, technology, origination and management (“ITOM”) fee income represents fee earned for originating, structuring, tokenizing, administering and managing blockchain-based investment products and digital securities that provide exposure to the economic returns of real-world assets. Such assets may be owned by SurancePlus or third-party asset owners and include, but are not limited to, insurance-linked investments and other alternative real-world assets. The Company’s performance obligations generally consist of arranging, structuring and completing the issuance or placement of the applicable tokenized investment product.
Revenue is recognized at the point in time when the applicable performance obligations are satisfied, which is generally upon the successful closing, issuance or placement of the applicable tokenized investment product and/or the placement of the underlying insurance policies where applicable. Management fees and other service-based fees, where applicable, are recognized over the period in which the related services are provided.
Cash and cash equivalents: Cash and cash equivalents are comprised of cash and short- term investments with original maturities of three months or less.
Restricted cash and cash equivalents: Restricted cash and cash equivalents represent funds held in accordance with the Company’s trust agreements with ceding insurers and trustees, which requires the Company to maintain collateral with a market value greater than or equal to the limit of liability, less unpaid premium. Restricted cash and cash equivalents also include funds held in the HCI 2026 Series Trust Accounts as collateral for the HCI Series tokenized interests (see Note 6).
Investments: The Company from time to time invests in fixed-maturity debt securities and equity securities, and for which its fixed-maturity debt securities are classified as available-for-sale. The Company’s available for sale debt investments are carried at fair value with changes in fair value included as a separate component of accumulated other comprehensive income (loss) in shareholders’ equity. For the Company’s investment in equity securities, the changes in fair value are recorded within the consolidated statements of operations. At September 30, 2026 and December 31, 2025 the Company did not own any fixed maturity debt securities or equity securities.
Unrealized gains or losses are determined by comparing the fair market value of the securities with their cost or amortized cost. Realized gains and losses on investments are recorded on the trade date and are included in the consolidated statements of operations. The cost of securities sold is based on the specified identification method. Investment income is recognized as earned and discounts or premiums arising from the purchase of debt securities are recognized in investment income using the interest method over the remaining term of the security.
Non-controlling interests: Non-controlling interests represent the portion of net assets and net income of consolidated subsidiaries that are not attributable to the Company. The Company recognizes non-controlling interests as a separate component of equity in the consolidated balance sheets and separately presents the portion of net income (loss) attributable to non-controlling interests in the consolidated statements of operations. Changes in the Company’s ownership interests in its subsidiaries that do not result in loss of control are accounted for as equity transactions. The non-controlling interest holders are not obligated to fund losses in the consolidated subsidiaries. The Company evaluates all transactions with non-controlling interest holders based on ASC 810 guidance and records any gains or losses directly to equity.
Fair value measurement: GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under GAAP are as follows:
| Level 1 | Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date; |
| Level 2 | Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, including inputs in markets that are not considered to be active; and |
| Level 3 | Inputs that are unobservable. |
| 8 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
Fair value measurement (cont’d)
Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. For fixed maturity debt securities, inputs may include price information, volatility statistics, specific and broad credit data, liquidity statistics, broker quotes for similar securities and other factors. The fair value of investments in stocks and exchange-traded funds is based on the last traded price. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires significant judgment by the Company’s investment custodians and management. The investment custodians consider observable data to be market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant markets.
Deferred policy acquisition costs (“DAC”): Policy acquisition costs consist of brokerage fees, federal excise taxes and other costs related directly to the successful acquisition of new or renewal insurance contracts and are deferred and amortized over the terms of the reinsurance agreements to which they relate. The Company evaluates the recoverability of DAC by determining if the sum of future earned premiums and anticipated investment income is greater than the expected future claims and expenses. If a loss is probable on the unexpired portion of policies in force, a premium deficiency loss is recognized.
Property
and equipment: Property and equipment are recorded at cost when acquired. Property and equipment are comprised of motor vehicles,
furniture and fixtures, computer equipment and leasehold improvements and are depreciated, using the straight-line method, over their
estimated useful lives, which are
Reserves for losses and loss adjustment expenses: The Company determines its reserves for losses and loss adjustment expenses, if any, on the basis of the claims reported by the Company’s ceding insurers and for losses incurred but not reported (“IBNR”), management uses the assistance of an independent actuary. The reserves for losses and loss adjustment expenses represent management’s best estimate of the ultimate settlement costs of all losses and loss adjustment expenses. Management believes that the amounts are adequate; however, the inherent impossibility of predicting future events with precision, results in uncertainty as to the amount which will ultimately be required for the settlement of losses and loss expenses, and the differences could be material. Adjustments are reflected in the consolidated statements of operations in the period in which they are determined.
Loss experience refund payable: Certain contracts may include retrospective provisions that adjust premiums or result in profit commissions in the event losses are minimal or zero. In accordance with GAAP, the Company will recognize a liability in the period in which the absence of loss experience obligates the Company to pay cash or other consideration under the contracts. On the contrary, the Company will derecognize such liability in the period in which a loss experience arises. Such adjustments to the liability, which accrue throughout the contract terms, will reduce the liability should a catastrophic loss event covered by the Company occur.
| 9 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
Premiums assumed: The Company records premiums assumed, net of loss experience refunds, as earned pro-rata over the terms of the reinsurance agreements, or period of risk, where applicable, and the unearned portion at the consolidated balance sheet date is recorded as unearned premiums reserve. A reserve is made for estimated premium deficiencies to the extent that estimated losses and loss adjustment expenses exceed related unearned premiums. Investment income is not considered in determining whether or not a deficiency exists.
Subsequent adjustments of premiums assumed, based on reports of actual premium by the ceding companies, or revisions in estimates of ultimate premium, are recorded in the period in which they are determined. Such adjustments are generally determined after the associated risk periods have expired; in which case the premium adjustments are fully earned when assumed.
Certain contracts allow for reinstatement premiums in the event of a full limit loss prior to the expiration of the contract. A reinstatement premium is not due until there is a full limit loss event and therefore, in accordance with GAAP, the Company records a reinstatement premium as written only in the event that the reinsured incurs a full limit loss on the contract and the contract allows for a reinstatement of coverage upon payment of an additional premium. For catastrophe contracts which contractually require the payment of a reinstatement premium equal to or greater than the original premium upon the occurrence of a full limit loss, the reinstatement premiums are earned over the original contract period. Reinstatement premiums that are contractually calculated on a pro-rata basis of the original premiums are earned over the remaining coverage period.
Unearned Premiums Ceded: The Company may reduce the risk of future losses on business assumed by reinsuring certain risks and exposures with other reinsurers (retrocessionaires). The Company remains liable to the extent that any retrocessionaire fails to meet its obligations and to the extent that the Company does not hold sufficient security for their unpaid obligations.
Ceded premiums are written during the period in which the risk is incepted and are expensed over the contract period in proportion to the period of protection. Unearned premiums ceded consist of the unexpired portion of the reinsurance obtained. There were no unearned premiums ceded at September 30, 2026 or December 31,2025.
Uncertain Income Tax Positions: The authoritative GAAP guidance on accounting for, and disclosure of, uncertainty in income tax positions requires the Company to determine whether an income tax position of the Company is more likely than not to be sustained upon examination by the relevant tax authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. For income tax positions meeting the more likely than not threshold, the tax amount recognized in the consolidated financial statements, if any, is reduced by the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement with the relevant taxing authority. The application of this authoritative guidance has had no effect on the Company’s consolidated financial statements because the Company had no uncertain tax positions at September 30, 2026.
| 10 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
Loss Per Share: Basic loss per share has been computed on the basis of the weighted-average number of ordinary shares outstanding during the periods presented. Diluted loss per share is computed based on the weighted-average number of ordinary shares outstanding and reflects the assumed exercise or conversion of diluted securities, such as stock options and warrants, computed using the treasury stock method.
Share-Based Compensation: The Company accounts for stock-based compensation under the fair value recognition provisions of GAAP which requires the measurement and recognition of compensation for all stock-based awards made to employees and directors, including stock options and restricted stock issuances based on estimated fair values. The Company measures compensation for restricted stock based on the price of the Company’s ordinary shares at the grant date. Determining the fair value of stock options at the grant date requires significant estimation and judgment. The Company uses an option-pricing model (Black-Scholes option pricing model) to assist in the calculation of fair value for stock options. When estimating the expected volatility, the Company takes into consideration the historical volatility of its common stock for a lookback period of one year.
Additionally, the Company uses the guidance in the SEC’s Staff Accounting Bulletin No. 107 to determine the estimated life of options issued and has assumed no forfeitures during the life of the options.
The Company uses the straight-line attribution method for all grants that include only a service condition. Compensation expenses related to all awards is included in general and administrative expenses.
Adoption of New Accounting Pronouncements
Changes to GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASU”) to the FASB Accounting Standards Codification. The Company considers the applicability and impact of all ASUs. Except as noted below, there were no significant ASUs adopted during the nine months ended September 30, 2026.
Future Adoption of New Accounting Pronouncements
In November 2025, the FASB issued new guidance on financial instrument credit losses (ASU 2025-08, Financial Instruments - Credit Losses (Topic 326): Purchased Loans). Under current GAAP, an allowance for credit losses for assets purchased with credit deterioration is established by grossing up the amortized cost basis of the asset, while the allowance for all other loans is recognized separately as an expense. The ASU expands the population of purchased financial instruments subject to the gross-up approach for determining the allowance for credit losses to include all purchased loans that meet certain criteria. The ASU is effective for annual and interim periods starting with fiscal year 2027. This ASU is required to be adopted prospectively for all loans acquired on or after the effective date. The Company is currently evaluating the impact of this guidance on its financial statements.
In November 2024, the FASB issued new guidance on income statement expense disclosures (ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses). This ASU requires public companies to disclose additional disaggregated information about expenses in the notes to financial statements at each interim and annual reporting period. This ASU is effective for fiscal years starting January 1, 2027, and for interim periods starting January 1, 2028. This ASU is required to be adopted prospectively with the option of retrospective application. The Company is currently evaluating the impact of this guidance on its financial statements.
FASB ASU 2025-03, “Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity”. This amendment determining the Accounting Acquirer in a Business Combination Involving a Variable Interest Entity. This update clarifies how to identify the accounting acquirer when a business combination involves a variable interest entity. The standard is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years. Early adoption is permitted. The amendment must be applied prospectively for business combinations occurring on or after the adoption date. The Company does not expect the adoption of this standard to have a material impact on its consolidated financial statements.
FASB ASU 2025-06, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Capitalization and Disclosure Improvements”. This amendment provides updated guidance on the capitalization of costs related to internal-use software and expands the required disclosures. The objective is to clarify when capitalization is appropriate and to enhance the transparency of financial reporting related to internal-use software development. The amendments in this update are effective for fiscal years beginning after December 15, 2027. Adoption of this guidance is not expected to have a material effect on the Company’s consolidated financial statements.
Segment
Information: Under GAAP, operating segments are based on the internal information that management uses for allocating resources
and assessing performance as the source of the Company’s reportable segments. The Company manages its business on the basis of
Reclassifications: Any reclassifications of prior period amounts have been made to conform to the current period presentation.
3. CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AND CASH EQUIVALENTS
SUMMARY OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AND CASH EQUIVALENTS
At September 30, 2026 | At December 31, 2025 | |||||||
| (in thousands) | ||||||||
| Cash on deposit | $ | $ | ||||||
| Restricted cash held in trust – (Cat Re token program) | ||||||||
| Restricted cash held in trust – (HCI 2026 token program)* | - | |||||||
| Total | $ | $ | ||||||
| * |
Cash and cash equivalents are held by large and reputable counterparties in the United States of America and in the Cayman Islands. Restricted cash held in trust is custodied with Truist Bank, and is held in accordance with the Company’s trust agreements with the ceding insurers and trustees, which require that the Company provide collateral having a market value greater than or equal to the limit of liability, less unpaid premium.
| 11 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
4. FAIR VALUE MEASUREMENTS
Assets Measured at Estimated Fair Value on a Recurring Basis
The following table presents information about the Company’s financial assets measured at estimated fair value on a recurring basis that is reflected in the consolidated balance sheets at carrying value. The table indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value as of September 30, 2026 and December 31, 2025:
SCHEDULE OF FAIR VALUE OF ASSETS MEASURED ON RECURRING BASIS
| (Level 1) | (Level 2) | (Level 3) | Total | |||||||||||||
| Fair Value Measurements Using | ||||||||||||||||
| (Level 1) | (Level 2) | (Level 3) | Total | |||||||||||||
| As of September 30, 2026 | ($ in thousands) | |||||||||||||||
| Financial Assets: | ||||||||||||||||
| Cash and cash equivalents | $ | $ | - | $ | - | $ | ||||||||||
| Restricted cash and cash equivalents – (Cat Re token program) | $ | $ | - | $ | - | $ | ||||||||||
| Restricted cash and cash equivalents – (HCI 2026 token program)* | $ | $ | - | $ | - | $ | ||||||||||
| Total | $ | $ | - | $ | - | $ | ||||||||||
| * |
| (Level 1) | (Level 2) | (Level 3) | Total | |||||||||||||
| Fair Value Measurements Using | ||||||||||||||||
| (Level 1) | (Level 2) | (Level 3) | Total | |||||||||||||
| As of December 31, 2025 | ($ in thousands) | |||||||||||||||
| Financial Assets: | ||||||||||||||||
| Cash and cash equivalents | $ | $ | - | $ | - | $ | ||||||||||
| Restricted cash and cash equivalents | $ | $ | - | $ | - | $ | ||||||||||
| Total | $ | $ | - | $ | - | $ | ||||||||||
There were no transfers between Levels 1, 2 or 3 during the nine-months ended September 30, 2026 and 2025.
| 12 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
5. TAXATION
Under current Cayman Islands law, no corporate entity, including the Company and the subsidiaries, is obligated to pay taxes in the Cayman Islands on either income or capital gains. The Company and Oxbridge Reinsurance Limited have an undertaking from the Governor-in-Cabinet of the Cayman Islands, pursuant to the provisions of the Tax Concessions Law, as amended, that, in the event that the Cayman Islands enacts any legislation that imposes tax on profits, income, gains or appreciations, or any tax in the nature of estate duty or inheritance tax, such tax will not be applicable to the Company and Oxbridge Reinsurance Limited or their operations, or to the ordinary shares or related obligations, until April 23, 2033 and May 17, 2033, respectively.
The Company and its Cayman Islands and BVI subsidiaries intend to conduct substantially all of their reinsurance and tokenization operations in a manner such that they will not be engaged in a trade or business in the U.S. However, because there is no definitive authority regarding activities that constitute being engaged in a trade or business in the U.S. for federal income tax purposes, the Company cannot assure that the U.S. Internal Revenue Service will not contend, perhaps successfully, that the Company or its subsidiary is engaged in a trade or business in the U.S. a foreign corporation deemed to be so engaged would be subject to U.S. federal income tax, as well as branch profits tax, on its income that is treated as effectively connected with the conduct of that trade or business unless the corporation is entitled to relief under an applicable tax treaty.
The Company intends that its subsidiaries organized in the U.S. will conduct its activities in the U.S and will be subject to U.S. federal and state income taxation as a corporation. The Company’s subsidiaries have incurred losses since its formation, no income tax provision or benefit has been recorded.
6. NOTES PAYABLE / MEZZANINE EQUITY
Oxbridge Re NS. On December 22, 2017, the Company established Oxbridge Re NS, a Cayman domiciled and licensed special purpose insurer, formed to provide additional collateralized capacity to support Oxbridge Reinsurance Limited’s reinsurance business. In respect of the participating notes issued by Oxbridge Re NS to investors, Oxbridge Re NS entered into retrocession agreements with Oxbridge Reinsurance Limited. Under these agreements, Oxbridge Re NS receives a quota share of Oxbridge Reinsurance Limited’s catastrophe business. Oxbridge Re NS is a non-rated insurer and the risks have been fully collateralized by way of funds held in trust for the benefit of Oxbridge Reinsurance Limited. Oxbridge Re NS is able to provide investors with access to natural catastrophe risk backed by the distribution, underwriting, analysis and research expertise of Oxbridge Re.
Upon issuance of a series of participating notes by Oxbridge Re NS, all of the proceeds from the issuance are deposited into collateral accounts, to fund any potential obligation under the reinsurance agreements entered into with Oxbridge Reinsurance Limited underlying such series of notes. The outstanding principal amount of each series of notes generally is expected to be returned to holders of such notes upon the expiration of the risk period underlying such notes, unless an event occurs which causes a loss under the applicable series of notes, in which case the amount returned is expected to be reduced by such noteholder’s pro rata share of such loss, as specified in the applicable governing documents of such notes. In addition, holders of such notes are generally entitled to interest payments, payable annually, as determined by the applicable governing documents of each series of notes.
The Company receives an origination and structuring fee in connection with the formation, operation and management of Oxbridge Re NS.
| 13 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
6. NOTES PAYABLE / MEZZANINE EQUITY (continued)
Notes Payable to Series 2020-1 noteholders
On
June 1, 2020, Oxbridge Re NS entered into a retrocession agreement with Oxbridge Reinsurance Ltd and issued $
The
outstanding balance was $
The
income from Oxbridge Re NS operations that are attributable to the participating notes noteholders for the nine-months ended September
30, 2026 and 2025 was $
SurancePlus Inc.
SurancePlus
Inc. (“SurancePlus”), an indirect
DeltaCat Re Tokens
On
March 27, 2023, we, through SurancePlus, issued a press release announcing the commencement of an offering by SurancePlus of up to $
On
June 27, 2023, SurancePlus completed the Private Placement. The aggregate amount raised in the Private Placement was $
On September 11, 2023, the DeltaCat Re tokens were reclassified as tokenized interests carrying rights equivalent to the DeltaCat Re Preferred Shares in accordance with the provisions of British Virgin Islands law.
On June 28, 2023, Oxbridge issued a press release announcing the completion of the DeltaCat Private Placement.
EpsilonCat Re Tokens
On
March 18, 2024, the Company and its subsidiary SurancePlus Inc, announced the commencement of an offering by SurancePlus of Participation
Shares (the “Participation Share” and together with the Preferred Shares, the “Securities”) represented by digital
tokens to be issued under a 3-year Participation Share Investment Contract (the “PSIC”). The Participation Shares are not
shares in SurancePlus and shall have no preemptive right or conversion rights. The Participation Shares solely conferred contractual
rights against SurancePlus as contained in the PSIC. At the offering’s commencement, up to one million (
On
July 11, 2024, SurancePlus completed its private placement (the “2024 Private Placement”) of Participation Shares. On July
11, 2024, SurancePlus entered into subscription agreements with accredited investors and non-U.S. persons in the 2024 Private Placement
with respect to
| 14 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
6. NOTES PAYABLE / MEZZANINE EQUITY (continued)
ZetaCat Re / EtaCat Re Tokens
During
the year ended December 31, 2025, the Company and its indirect
On
July 31, 2025, SurancePlus completed its private placement (the “2025 Private Placement”) of Participation Shares. On July
31, 2025, SurancePlus entered into subscription agreements with investors in the 2025 Private Placement with respect to
T20 / T42 Tokens
On
February 10, 2026, the Company announced the commencement of an offering by SurancePlus of Participation Shares (the “Securities”)
represented by digital tokens to be issued under a 3-year Participation Share Investment Contract (the “PSIC”). The Participation
Shares are not shares in SurancePlus (or the Company) and shall have no preemptive right or conversion rights. The Participation Shares
solely confer contractual rights against SurancePlus as contained in the PSIC, represented by digital tokens labelled “T20-2027”
and “T42-2027”, representing our balanced yield and high yield participation shares, respectively. The quantity of Participation
Shares to be issued in subsequent years of 2027, and 2028, shall be disclosed prior to their issuances. At the start of the offering,
the Participation Shares will be offered at an initial price of $
On
June 30, 2026, SurancePlus completed its private placement of Participating Shares, and entered into subscription agreements with investors
with respect to
HCI 2026 Series Tokens
On
June 30, 2026, SurancePlus completed its private placement of Tokenized Interests and entered into subscription agreements with investors
with respect to
The Tokenized Interests and Participation Shares above constitute contractual rights issued pursuant to the TIC and PSIC, respectively. They do not constitute equity securities or shares of SurancePlus Inc., do not confer any ownership interest, voting rights, dividend rights, preemptive rights, or conversion rights, and solely entitle the holders to the contractual rights expressly provided under the TIC and PSIC.
The Securities (i.e.Tokenized Interests and Participation Shares) have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state or other securities laws and may not be offered or sold in the United States absent an effective registration statement or an applicable exemption from registration requirements or a transaction not subject to the registration requirements of the Securities Act or any state or other securities laws. The Securities were sold in a transaction exempt from registration under the Securities Act and were sold only to persons reasonably believed to be accredited investors in the United States under SEC Rule 506(c) under the Securities Act and outside the United States only to non-U.S. persons in accordance with Regulation S under the Securities Act.
| 15 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
6. NOTES PAYABLE / MEZZANINE EQUITY (continued)
Collateral and Trust Agreements
In
relation to the offering of the HCI 2026 Series Tokens disclosed above, on June 30 2026, the Company entered into an initial collateral
and additional collateral deposit agreement (“Collateral Deposit Agreement”) with HCI Group. Under the Collateral Deposit
Agreement, HCI provided additional collateral totaling $
Under Accounting Standards Codification 480 “Distinguishing Liabilities from Equity” (ASC 480) a redeemable financial instrument that will be redeemed only upon the occurrence of a conditional event is required to be excluded from presentation on the consolidated balance sheets as a liability. The potential cash settlement of the PSIC is contingent upon there being no losses with respect to the underlying reinsurance contracts. Therefore, since these events are not solely within the control of the Company the PSIC has been presented as mezzanine equity in the accompanying consolidated balance sheets as required by ASC 480.
The
HCI 2026 Series tokenized interest are carried at their redemption value, assuming no underwriting losses, which includes the interest
earned and accrued on the collateral held in the Series Trust Accounts. During the three and nine months ended September 30, 2026, the
Company recorded a remeasurement adjustment of $
Summarized Financial Data
The selected unconsolidated historical financial information and other data presented below is derived from SurancePlus’ standalone unaudited financial statements for the three months and nine months periods ended September 30, 2026 and 2025 and the balance sheet data as of September 30, 2026 and December 2025.
SCHEDULE OF FINANCIAL STATEMENTS
| Statements of Operations Data: | For Three Months Ended September 30, 2026 | For Nine Months Ended September 30, 2026 | ||||||
| (Unaudited) | (Unaudited) | |||||||
| SurancePlus management fee income | $ | - | $ | |||||
| Net investment income | ||||||||
| Underwriting related income | ||||||||
| Total revenue | ||||||||
| Expenses | ( | ) | ( | ) | ||||
| Income attributable to tokenholders* | ( | ) | ( | ) | ||||
| Net income | $ | $ | ||||||
| * |
| Balance Sheet Data: | At September 30, 2026 | At December 31, 2025 | ||||||
| (Unaudited) | (Unaudited) | |||||||
| (In thousands) | (In thousands) | |||||||
| Total assets | $ | $ | ||||||
| Amounts due to tokenholders* | ||||||||
| Due to Parent | ||||||||
| Due to affiliate | - | |||||||
| Other liabilities, current | - | |||||||
| HCI 2026 Series Tokens | - | |||||||
| Mezzanine equity | - | |||||||
| Total shareholder’s equity | $ | $ | ||||||
| * |
| 16 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
7. AI GRIDWORKS LTD.
The
Company directly owns
AI GridWorks intends to develop, own, and operate artificial intelligence (“AI”) data centers to address the growing demand for AI computing infrastructure. AI GridWorks plans to pursue data center development projects with capacities ranging from approximately 10 megawatts (“MW”) to 100 MW, with an initial focus on facilities of approximately 50 MW. AI GridWorks may also evaluate larger-scale development opportunities based on customer demand, market conditions, and other strategic considerations. The Company plans to have a separate operating entity for each potential data center site developed.
AI
Gridworks and its U.S. subsidiaries are being funded under promissory note agreements with its respective parent entity. As of September 30,
2026, approximately $
8. RESERVE FOR LOSSES AND LOSS ADJUSTMENT EXPENSES
SCHEDULE OF LOSS ADJUSTMENT EXPENSES
At September 30, 2026 | At September 30, 2025 | |||||||
| (in thousands) | ||||||||
| Balance, beginning of period | $ | $ | - | |||||
| Incurred related to: | ||||||||
| Current period | - | - | ||||||
| Prior period | - | |||||||
| Total incurred | - | |||||||
| Paid related to: | ||||||||
| Current period | - | ( | ) | |||||
| Prior period | - | ( | ) | |||||
| Total paid | - | ( | ) | |||||
| Balance, end of period | $ | $ | - | |||||
When losses occur, the reserves for losses and LAE are typically comprised of case reserves (which are based on claims that have been reported) and IBNR reserves (which are based on losses that are believed to have occurred but for which claims have not yet been reported and include a provision for expected future development on existing case reserves). The Company typically suffers limit losses in the event of a Category 3 or above hurricane making landfall in a populated area where the Company has catastrophe risk exposure.
The uncertainties inherent in the reserving process and potential delays by cedants and brokers in the reporting of loss information, together with the potential for unforeseen adverse developments, may result in the reserve for losses and LAE ultimately being significantly greater or less than the reserve provided at the end of any given reporting period. The degree of uncertainty is further increased when a significant loss event takes place near the end of a reporting period. Reserve for losses and LAE estimates are reviewed periodically on a contract-by-contract basis and updated as new information becomes known. Any resulting adjustments are reflected in income in the period in which they become known.
The Company’s reserving process is highly dependent on the timing of loss information received from its cedants and related brokers.
There were no losses incurred during the nine months period ended September 30, 2026. No losses were incurred relating to the 2025/26 treaty.
Loss reserves are generally established based on loss payments and case reserves reported by clients when, and if, received. Estimates for IBNR losses are added to the case reserves. To establish IBNR loss estimates, the Company uses quarterly actuarial estimates from its independent actuary, who utilizes loss data reported by the Company along with industry loss data and information, knowledge of the business written and actuary’s own professional judgment.
| 17 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
9. LOSS PER SHARE
A summary of the numerator and denominator of the basic and diluted loss per share is presented below (dollars in thousands except per share amounts):
SCHEDULE OF COMPUTATION OF BASIC AND DILUTED LOSS EARNING PER SHARE
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Numerator: | ||||||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Denominator: | ||||||||||||||||
| Weighted average shares - basic | ||||||||||||||||
| Weighted average shares - diluted | ||||||||||||||||
| Loss per share - basic | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Loss per share - diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
For
the three-months and nine months period ended September, 2026,
For
the three-months and nine-months period ended September 30, 2025,
For
the three-months and nine-months period ended September 30, 2026,
For
the three-months and nine-months period ended September 30, 2025,
GAAP requires the Company to use the two-class method in computing basic loss per share since holders of the Company’s restricted stock have the right to share in dividends, if declared, equally with common stockholders. These participating securities effect the computation of both basic and diluted income (loss) per share during the periods ended September 30, 2026 and 2025.
10. EQUITY
Ordinary Shares
There
were
During
the nine months ended September 30, 2026, we have sold
WARRANTS
On
January 29, 2024, the Company extended the expiration date of the warrants (NASDAQ: OXBRW) (the “Warrants”) to 5:00 p.m.
Philadelphia time on the earlier to occur of (a) March 26, 2029 and (b) the date fixed for cancellation by the Company following any
20-trading day period in which the Company’s ordinary shares traded above $
There
were
Securities purchase agreement
On February 24, 2025, the Company and an institutional investor (the “Investor”) entered into a securities purchase agreement (the “Securities Purchase Agreement”) relating to the issuance and sale of ordinary shares of the Company pursuant to a registered direct offering and a private placement of warrants to purchase ordinary shares (collectively, the “Offering”).
The
Investor purchased approximately $
The
net proceeds to the Company from the Offering, after deducting the fees of Maxim Group LLC (the “Placement Agent”) and the
Company’s estimated offering expenses, were approximately $
The ordinary shares were offered and sold pursuant to the Company’s Registration Statement on Form S-3 (Registration No. 333-262590) previously filed with the Securities and Exchange Commission (the “SEC”) and declared effective, the base prospectus included therein and the related prospectus supplement. The Warrants were issued in a private placement and were exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance on Section 4(a)(2) thereof as a transaction not involving a public offering and/or Rule 506 of Regulation D promulgated thereunder.
The
Company paid the Placement Agent a cash fee of
| 18 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
11. DIVIDENDS
As of December 31, 2025, none of the Company’s accumulated deficit were restricted from payment of dividends to the company’s shareholders. However, since most of the Company’s capital and retained earnings may be invested in its subsidiaries, a dividend from any reinsurance subsidiaries would likely be required in order to fund a dividend to the Company’s shareholders and would require notification to the Cayman Islands Monetary Authority (“CIMA”).
Under Cayman Islands law, the use of additional paid-in capital is restricted, and the Company will not be allowed to pay dividends out of additional paid-in capital if such payments result in breaches of the prescribed and minimum capital requirement.
12. SHARE-BASED COMPENSATION
On
August 28, 2025, the Company adopted the 2025 Omnibus Incentive Plan (the “2025 Plan”), which automatically terminated the
2021 Plan. The 2025 Plan provides that
On
January 2, 2026
Stock options
Stock
options granted and outstanding under the Plan vests quarterly over four years and are exercisable over the contractual term of
A summary of the stock option activity for the nine-month periods ended September 30, 2026 and 2025 are as follows:
SCHEDULE OF STOCK OPTION ACTIVITY
Number of Options | Weighted- Average Exercise Price | Weighted- Average Remaining Contractual Term | Aggregate Intrinsic Value | |||||||||||||
| Outstanding at December 31, 2024 | $ | $ | - | |||||||||||||
| Exercisable at June 30, 2025 | $ | $ | - | |||||||||||||
| Granted | $ | $ | - | |||||||||||||
| Forfeited | ( | ) | $ | |||||||||||||
| Exercised during the quarter | ( | ) | $ | |||||||||||||
| Outstanding at March 31, 2025 | $ | $ | - | |||||||||||||
| Exercisable at March 31, 2025 | $ | $ | - | |||||||||||||
| Outstanding at June 30, 2025 | $ | $ | - | |||||||||||||
| Exercisable at June 30, 2025 | $ | $ | - | |||||||||||||
| Granted | $ | |||||||||||||||
| Outstanding at September 30, 2025 | $ | $ | - | |||||||||||||
| Exercisable at September 30, 2025 | $ | $ | - | |||||||||||||
| Outstanding at December 31, 2025 | $ | $ | - | |||||||||||||
| Outstanding at March 31, 2026 | $ | $ | - | |||||||||||||
| Exercisable at March 31, 2026 | $ | $ | - | |||||||||||||
| Outstanding at June 30, 2026 | $ | $ | - | |||||||||||||
| Exercisable at June 30, 2026 | $ | $ | - | |||||||||||||
| Forfeited | ( | ) | $ | |||||||||||||
| Outstanding at September 30, 2026 | $ | $ | - | |||||||||||||
| Exercisable at September 30, 2026 | $ | $ | - | |||||||||||||
Compensation
expense recognized for the nine-month periods ended September 30, 2026 and 2025 totaled $
Restricted Stock Awards
The Company may grant restricted stock awards to eligible individuals in connection with their service to the Company. The terms of the Company’s outstanding restricted stock grants may include service, performance and market-based conditions. The fair value of the awards with market-based conditions is determined using a Monte Carlo simulation method, which calculates many potential outcomes for an award and then establishes fair value based on the most likely outcome. The determination of fair value with respect to the awards with only performance or service-based conditions is based on the value of the Company’s stock on the grant date.
| 19 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
12. SHARE-BASED COMPENSATION (cont’d)
Restricted Stock Awards (cont’d)
During
the nine-month periods ended September 30, 2026 and 2025, the Company granted
SCHEDULE OF ACTIVITY OF UNVESTED RESTRICTED STOCK AWARDS
| Weighted- | ||||||||
| Number of | Weighted- | |||||||
| Restricted | Average | |||||||
| Stock | Grant Date | |||||||
| Awards | Fair Value | |||||||
| Nonvested at December 31, 2024 | ||||||||
| Granted | $ | |||||||
| Vested | ( | ) | $ | |||||
| Forfeited | ( | ) | $ | |||||
| Nonvested at March 31, 2025 | ||||||||
| Vested | ( | ) | $ | |||||
| Nonvested at June 30, 2025 | ||||||||
| Granted | $ | |||||||
| Vested | ( | ) | $ | |||||
| Forfeited | ( | ) | $ | |||||
| Nonvested at September 30, 2025 | ||||||||
| Nonvested at December 31, 2025 | ||||||||
| Granted | $ | |||||||
| Vested | ( | ) | $ | |||||
| Nonvested at March 31, 2026 | ||||||||
| Granted | - | $ | - | |||||
| Vested | ( | ) | $ | |||||
| Nonvested at June 30, 2026 | ||||||||
| Granted | $ | 1.56 | ||||||
| Forfeited | ( |
$ | 1.64 | |||||
| Vested | ( | ) | $ | |||||
| Nonvested at September 30, 2026 | ||||||||
Compensation
expense recognized for the nine-month periods ended September 30, 2026 and 2025 totaled $
13. NET WORTH FOR REGULATORY PURPOSES
The
subsidiaries are subject to a minimum and prescribed capital requirement as established by CIMA.
At
September 30, 2026, Oxbridge Reinsurance Limited’s net worth of $
At
September 30, 2026, the Oxbridge Re NS’ net worth of $
The Subsidiaries are not required to prepare separate statutory financial statements for filing with CIMA, and there were no material differences between the Subsidiaries’ GAAP capital, surplus and net (loss) income, and its statutory capital, surplus and net (loss) income as of September 30, 2026 or for the period then ended.
| 20 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
14. FAIR VALUE AND CERTAIN RISKS AND UNCERTAINTIES
Fair values
With the exception of balances in respect of insurance contracts (which are specifically excluded from fair value disclosures under GAAP) the carrying amounts of all other financial instruments, which consist of cash and cash equivalents, restricted cash and cash equivalents, premiums receivable and other assets, notes payable and accounts payable and other liabilities, approximate their fair values due to their short-term nature.
Concentration of underwriting risk
A substantial portion of the Company’s current reinsurance business ultimately relates to the risks of a limited number of entities; accordingly, the Company’s underwriting risks are not significantly diversified.
Concentrations of Credit and Counterparty Risk
The Company markets retrocessional and reinsurance policies worldwide through its brokers. Credit risk exists to the extent that any of these brokers may be unable to fulfill their contractual obligations to the Company. For example, the Company is required to pay amounts owed on claims under policies to brokers. In some jurisdictions, if a broker fails to make such a payment, the Company might remain liable to the ceding company for the deficiency. In addition, in certain jurisdictions, when the ceding company pays premiums for these policies to brokers, these premiums are considered to have been paid and the ceding insurer is no longer liable to the Company for those amounts, whether or not the premiums have actually been received.
The Company remains liable for losses it incurs to the extent that any third-party reinsurer is unable or unwilling to make timely payments under reinsurance agreements. The Company would also be liable in the event that its ceding companies were unable to collect amounts due from underlying third-party reinsurers.
The Company mitigates its concentrations of credit and counterparty risk by using reputable and several counterparties which decreases the likelihood of any significant concentration of credit risk with any one counterparty.
Market risk
Market risk exists to the extent that the values of the Company’s monetary assets fluctuate as a result of changes in market prices. Changes in market prices can arise from factors specific to individual securities or their respective issuers, or factors affecting all securities traded in a particular market. Relevant factors for the Company are both volatility and liquidity of specific securities and markets in which the Company holds investments. The Company has established investment guidelines that seek to mitigate significant exposure to market risk.
| 21 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
15. LEASES
Operating lease right-of-use assets and operating lease liabilities are disclosed as line in the consolidated balance sheets. We determine if a contract contains a lease at inception and recognize operating lease right-of-use assets and operating lease liabilities based on the present value of the future minimum lease payments at the commencement date. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. Lease agreements that have lease and non-lease components, are accounted for as a single lease component. Lease expense is recognized on a straight-line basis over the lease term.
The
Company has
The components of lease expense and other lease information as of and during the nine-month periods ended September 30, 2026 and 2025 are as follows:
SCHEDULE OF OPERATING LEASE COST
For the Nine-Month Period | For the Nine-Month Period | |||||||
| (in thousands) | Ended September 30, 2026 | Ended September 30, 2025 | ||||||
| Operating Lease Cost (1) | $ | $ | ||||||
| Cash paid for amounts included in the measurement of lease liabilities | ||||||||
| Operating cash flows from operating leases | $ | $ | ||||||
| (1) |
SCHEDULE OF OTHER LEASE INFORMATION
| (in thousands) | At September 30, 2026 | At December 31, 2025 | ||||||
| Operating lease right-of-use assets | $ | $ | ||||||
| Operating lease liabilities | $ | $ | ||||||
| Weighted-average remaining lease term - operating leases | ||||||||
| Weighted-average discount rate - operating leases | % | % | ||||||
Future minimum lease payments under non-cancellable leases as of September 30, 2026 and December 31, 2025, reconciled to our discounted operating lease liability presented on the consolidated balance sheets are as follows:
SCHEDULE OF FUTURE MINIMUM LEASE PAYMENT
| (in thousands) | At September 30, 2026 | At December 31, 2025 | ||||||
| 2026 | $ | $ | ||||||
| 2027 | ||||||||
| Total future minimum lease payments | $ | $ | ||||||
| Less imputed interest | ( | ) | ( | ) | ||||
| Total operating lease liability | $ | $ | ||||||
| 22 |
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
September 30, 2026
16. RELATED PARTY TRANSACTIONS
HCI and Tailrow Insurance exchange (“HCI”) Contract
During
the nine months ended September 30, 2025, the Company entered into a reinsurance agreement with HCI, which is a related entity through
common directorship. This contract expired at May 31, 2026. At September 30, 2026, there are no balances relating to the reinsurance agreement
with HCI on the consolidated balance sheets. During the nine-month period ended September 30, 2026, included within assumed premiums,
change in unearned premium reserve and policy acquisition costs and underwriting expenses on the consolidated statements of operations
are amounts equal to $
HCI 2026 Series Tokens and Collateral and Trust Agreements
During the nine months ended September 30, 2026, the Company completed the HCI 2026 Series A, B and C tokenized interests offering and entered into related collateral and trust agreements with HCI Group. Refer to Note 6.
Promissory Note
On
February 11, 2026, the Company entered into a Promissory Note (the “Note”) pursuant to which the Company borrowed $
17. SUBSEQUENT EVENTS
We evaluate all subsequent events and transactions for potential recognition or disclosure in our consolidated financial statements. There were no events subsequent to September 30, 2026 for which disclosure was required.
| 23 |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
SPECIAL NOTE ABOUT FORWARD-LOOKING STATEMENTS
Certain statements in this Quarterly Report on Form 10-Q, including in this Management’s Discussion and Analysis, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements generally are identified by the words “believe,” “project,” “predict,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. A detailed discussion of risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in the section entitled “Risk Factors” contained in our Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 30, 2026. We undertake no obligation to publicly update or revise any forward -looking statements, whether as a result of new information, future events, or otherwise. Readers are cautioned not to place undue reliance on the forward -looking statements which speak only to the dates on which they were made.
GENERAL
The following is a discussion and analysis of our results of operations for the nine-month periods ended September 30, 2026 and 2025 and our financial condition as of September 30, 2026 and December 31, 2025. The following discussion should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and in our Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 30, 2026. References to “we,” “us,” “our,” “our company,” or “the Company” refer to Oxbridge Re Holdings Limited and its subsidiaries, Oxbridge Reinsurance Limited, Oxbridge Re NS, SurancePlus Holdings Ltd., SurancePlus, Inc. and AI GridWorks Ltd., unless the context dictates otherwise.
Overview and Trends
We are a Cayman Islands specialty property and casualty reinsurer that provides reinsurance solutions through our reinsurance subsidiaries, Oxbridge Reinsurance Limited and Oxbridge Re NS. We focus on underwriting fully collateralized reinsurance contracts primarily for property and casualty insurance companies in the Gulf Coast region of the United States, with an emphasis on Florida. We specialize in underwriting medium frequency, high severity risks, where we believe sufficient data exists to analyze effectively the risk/return profile of reinsurance contracts. Oxbridge Re NS functions as a reinsurance sidecar which increases the underwriting capacity of Oxbridge Reinsurance Limited. Oxbridge Re NS issues participating notes to third party investors, the proceeds of which are utilized to collateralize Oxbridge Reinsurance Limited’s reinsurance obligations.
In addition to our historical reinsurance business operations, in 2023, our new subsidiary SurancePlus developing, offering, and selling a tokenized reinsurance security representing fractionalized interests in reinsurance contracts, with each token representing an interest in participating notes issued by Oxbridge Re NS. These efforts culminated in the development, launch, and issuance of our first tokenized reinsurance security, the DeltaCat Re Token, which we believe is the first “on-chain” reinsurance security of its kind to be developed by a subsidiary of a public company. Following the issuance of the DeltaCat Re Token, we intend to develop, launch, and issue additional series of tokenized reinsurance securities representing fractional interests in reinsurance contracts, and we are also using our tokenization experience and activities as a foundation for developing Web3-focused business offerings and products relating to the tokenization of other real-world assets (RWAs), including RWAs held or being acquired by third parties. Our tokenization business will be conducted through SurancePlus and through other subsidiaries of our 80% owned subsidiary, SurancePlus Holdings Ltd. (“SurancePlus Holdings”), a Cayman Islands exempted company that we have organized to serve as a holding company for subsidiaries that will operate our developing Web3-focused business operations.
| 24 |
In our historical reinsurance business operations, we underwrite reinsurance contracts on a selective and opportunistic basis as opportunities arise based on our goal of achieving favorable long-term returns on equity for our shareholders. Our goal is to achieve long-term growth in book value per share by writing business that generates attractive underwriting profits relative to the risk we bear. Additionally, we intend to complement our underwriting profits with investment profits on an opportunistic basis. Our underwriting business focus is on fully collateralized reinsurance contracts for property catastrophes, primarily in the Gulf Coast region of the United States. Within that market and risk category, we attempt to select the most economically attractive opportunities across a variety of property and casualty insurers. As we attempt to grow our capital base, we expect that we will consider further growth opportunities in other geographic areas and risk categories.
Our level of profitability is primarily determined by how adequately our premiums assumed and investment income cover our costs and expenses, which consist primarily of acquisition costs and other underwriting expenses, claim payments and general and administrative expenses. One factor leading to variation in our operational results is the timing and magnitude of any follow-on offerings we undertake (if any), as we are able to deploy new capital to collateralize new reinsurance treaties and consequently, earn additional premium revenue. In addition, our results of operations may be seasonal in that hurricanes and other tropical storms typically occur during the period from June 1 through November 30. Further, our results of operations may be subject to significant variations due to factors affecting the property and casualty insurance industry in general, which include competition, legislation, regulation, general economic conditions, judicial trends, and fluctuations in interest rates and other changes in the investment environment.
Because we employ an opportunistic underwriting and investment philosophy, period-to-period comparisons of our underwriting results may not be meaningful. In addition, our historical investment results may not necessarily be indicative of future performance. Due to the nature of our reinsurance and investment strategies, our operating results will likely fluctuate from period to period.
Compared to most of our competitors, we are small and have low overhead expenses. We believe that our expense efficiency, agility and existing relationships support our competitive position and allows us to profitably participate in lines of business that fit within our strategy. Over time we expect our expense advantage to erode as the industry acts to reduce frictional costs.
Recent Developments
Formation of SurancePlus
SurancePlus Inc. (“SurancePlus”), an indirect 80% owned subsidiary of Oxbridge Re Holdings Limited, was incorporated as a British Virgin Islands Business Company on December 19, 2022 for the purposes of tokenizing reinsurance contracts underwritten by its affiliated licensed reinsurer, Oxbridge Re NS.
DeltaCat Re Tokens
On March 27, 2023, we, through SurancePlus, issued a press release announcing the commencement of an offering by SurancePlus of up to $5.0 million of DeltaCat Re Tokens with a purchase price of $10.00 per DeltaCat Re Token and representing one share of Series DeltaCat Re Preferred Shares per DeltaCat Re Token (the “Private Placement”).
On June 27, 2023, SurancePlus completed the Private Placement. The aggregate amount raised in the Private Placement was $2,447,760 for the issuance of 244,776 DeltaCat Re Tokens, of which approximately $1,280,000 was received from third-party investors and approximately $1,167,000 was received from Oxbridge Re Holdings Limited.
On September 11, 2023, the DeltaCat Re tokens were reclassified as tokenized interests carrying rights equivalent to the DeltaCat Re Preferred Shares in accordance with the provisions of British Virgin Islands law.
| 25 |
EpsilonCat Re Tokens
On March 18, 2024, Oxbridge Re Holdings Limited and its indirectly owned subsidiary SurancePlus Inc. (“SurancePlus”), a British Virgin Islands Business Company, announced the commencement of an offering by SurancePlus of Participation Shares represented by digital tokens to be issued under a 3-year Participation Share Investment Contract (the “PSIC”). The Participation Shares are not shares in SurancePlus and shall have no preemptive right or conversion rights. The Participation Shares solely conferred contractual rights against SurancePlus as contained in the PSIC. The quantity of Participation Shares to be issued in subsequent years of 2025, and 2026, shall be disclosed prior to their issuances. At the start of the offering, the Participation Shares were offered at an initial price of $10.00 per Participation Share.
The net proceeds from the offer and sale of the Participation Shares were used by SurancePlus to purchase one or more participating notes of Oxbridge Re NS, an affiliated Cayman Islands licensed reinsurance entity, and the proceeds from the sale of such participating notes will be invested in collateralized reinsurance contracts to be underwritten by Oxbridge Re NS. The holders of the Participation Shares will generally be entitled to proceeds from the payment of the participating notes in the amount of a preferred return equal to the initial Participation Share price, plus 20%, and then 80% of any proceeds in excess of the amount necessary to pay the preferred return.
On July 12, 2024, SurancePlus completed a private placement. The aggregate amount raised in the Private Placement was $2,878,048 Participation Shares represented by digital tokens issued under a 3-year Participation Share Investment Contract (for the issuance of 287,705 of the Participation Shares represented by the digital tokens, of which approximately $1,469,000 was received from third-party investors and approximately $1,409,000 was received from Oxbridge Re Holdings Limited.
ZetaCat Re / EtaCat Re Tokens
On July 31, 2025, SurancePlus completed its private placement (the “Private Placement”) of Participation Shares (the “Securities”) represented by digital tokens issued under a 3-year Participation Share Investment Contract (the “PSIC”). On July 31, 2025, SurancePlus entered into subscription agreements with investors in the Private Placement with respect to 361,191 of the Participation Shares represented by the digital tokens, ZetaCat Re (156,191 tokens) and EtaCat Re (205,000 tokens) at a purchase price of $10.00 per Participation Share for aggregate gross proceeds of $3,611,910. The tokens were issued on the Avalanche blockchain. Ownership of the ZetaCatRe and EtaCatRe tokenized Participation Shares indirectly conferred fractionalized interests in reinsurance contracts underwritten by Oxbridge Re’s reinsurance subsidiary, Oxbridge Re NS, for the 2025-2026 treaty year. The Participation Shares are not shares in SurancePlus have no preemptive right or conversion rights. The Participation Shares solely conferred contractual rights against SurancePlus as contained in the PSIC.
T20 / T42 / HCI 2026 Series Tokens
On June 30, 2026, SurancePlus completed its private placement (the “2026 Private Placement”) of tokenized reinsurance securities. On June 30, 2026, SurancePlus entered into subscription agreements with investors in the 2026 Private Placement with respect to 300,000 of Tokenized Interests represented by the digital tokens HCI 2026 Series and the Participation Shares represented by the T42 / T20 Tokens. 300,000 of tokenized interests are represented by 100,000 HCI 2026 Series A tokenized interests at a purchase price of $11.10 per token representing gross proceeds of $1.1 million with a redemption value of $36.31 per token assuming no losses, 100,000 HCI 2026 Series B tokenized interests at a purchase price of $ 22.12 per token representing gross proceeds of $2.2 million with a redemption value of $49.43 per token assuming no losses and 100,000 HCI 2026 Series C tokenized interests at a purchase price of $30.01 per token representing gross proceeds of $3 million with a redemption value of $35.51 per token assuming no losses. 78,177 of the Participation Shares represented by the T42 Tokens (46,261 tokens) and T20 Tokens (31,916 tokens) at a purchase price of $10.00 per Participation Share for aggregate gross proceeds of $781,767 out of which approximately $744,623 was received from Oxbridge Re Holdings Limited and $37,143 was received from third party investors. The T42 Tokens and T20 Tokens were issued on the Solana blockchain. Ownership of the T42 and T20 tokenized Participation Shares indirectly conferred fractionalized interests in reinsurance contracts underwritten by Oxbridge Re’s reinsurance subsidiary, Oxbridge Re NS, for the 2026-2027 treaty year. The Participation Shares are not shares in SurancePlus and have no preemptive right or conversion rights. The Participation Shares solely conferred contractual rights against SurancePlus as contained in the PSIC.
Formation of AI GridWorks
AI GridWorks Ltd. (“AI GridWorks”), a direct 80% owned subsidiary of Oxbridge Re Holdings Limited, was incorporated as a Cayman Islands Company on February 18, 2022 for the purposes of development and ownership of AI data centers and related infrastructure.
AI GridWorks Ltd. (“AI GridWorks”) intends to develop, own, and operate artificial intelligence (“AI”) data centers to address the growing demand for AI computing infrastructure. AI GridWorks plans to pursue data center development projects with capacities ranging from approximately 10 megawatts (“MW”) to 100 MW, with an initial focus on facilities of approximately 50 MW. AI GridWorks may also evaluate larger-scale development opportunities based on customer demand, market conditions, and other strategic considerations.
In connection with its planned operations, AI GridWorks is in the process of establishing the technical, operational, and development capabilities necessary to execute its business strategy, including expertise in power infrastructure, real estate, engineering, construction, and data center operations. As projects progress, AI GridWorks expects to engage third-party engineering, construction, and technology service providers, as appropriate.
On August 14, 2026, AI GridWorks entered into a promissory note agreement with Oxbridge Re Holdings Limited (“Oxbridge”), effective July 14, 2026, pursuant to which Oxbridge agreed to make available financing of up to $500,000. Under the terms of the agreement, AI GridWorks may draw funds against the promissory note to finance its operating activities and other business requirements, subject to the terms and conditions of the agreement. The promissory note bears no interest and be payable on the earlier of (a) the date on which the Maker consummates a major corporate financing, transaction or initial business combination, (b) the date of the liquidation of the Maker or (c) the date on which the Payee demands full or partial payment, at its sole discretion. As of September 30, 2026, approximately $107,000 had been drawn under the promissory note, of which approximately $64,500 related to employee salaries and employment-related expenses.
| 26 |
ATM Facility
On September 30, 2022, the Company entered into an Equity Distribution Agreement (the “Offering Agreement”) with Maxim Group LLC, as sales agent (the “Sales Agent”), pursuant to which the Company could offer and sell, from time to time, through the Sales Agent up to $6,300,000 of the Company’s ordinary shares, $0.001 par value (“Ordinary Shares”). The expiration date of the Offering Agreement is the earlier of (i) the issuance and sale of the Ordinary Shares having an aggregate offering price equal to $6,300,000, or (ii) the termination of the Offering Agreement by either the Sales Agent or the Company, in each such party’s sole discretion, upon the provision of thirty (30) days’ written notice. The Company will pay the Sales Agent a commission equal to 3.0% of the gross proceeds of the Ordinary Shares sold by the Sales Agent pursuant to the Offering Agreement.
On July 9, 2025, the Company entered into a new offering agreement (“New Offering Agreement”) with the Sales Agent, pursuant to which the Company could offer and sell, from time to time, through the Sales Agent up to $5 million of the Company’s Ordinary Shares. The expiration date of the New Offering Agreement is the earlier of (i) the issuance and sale of the Ordinary Shares having an aggregate offering price equal to $5 million, or (ii) the termination of the Offering Agreement by either the Sales Agent or the Company, in each such party’s sole discretion, upon the provision of thirty (30) days’ written notice. The Company will pay the Sales Agent a commission equal to 3.0% of the gross proceeds of the Ordinary Shares sold by the Sales Agent pursuant to the New Offering Agreement. The New Offering Agreement replaced our prior sales agreement dated September 30, 2022 with the Sales Agent pursuant to which the Company sold Ordinary Shares having an aggregate sales price of $4.6 million.
On June 22, 2026, the Company entered into an At-the-Market Sales Agreement (the “Offering Agreement”) with Chardan Capital Markets LLC, as sales agent (the “Sales Agent”), pursuant to which the Company could offer and sell, from time to time, through the Sales Agent, the Company’s ordinary shares, $0.001 par value (“Ordinary Shares”). The Company will pay the Sales Agent a commission equal to 3.0% of the gross proceeds of the Ordinary Shares sold by the Sales Agent pursuant to the Offering Agreement. The Company will also reimburse the Sales Agent for fees and disbursements of its legal counsel in an amount not to exceed $20,000 in connection with the execution of the Offering Agreement The Sales Agreement replaced our prior sales agreement dated July 9, 2025 with Maxim Group LLC, which was terminated on June 20, 2026.
Sales of the Ordinary Shares under the Offering Agreement, if any, may be made in transactions that are deemed to be “at-the-market” offerings as defined in Rule 415 under the Securities Act of 1933, as amended, including without limitation sales made directly on or through the Nasdaq Capital Market or any other existing trading market for the Ordinary Shares. The Sales Agent will use commercially reasonable efforts consistent with its normal trading and sales practices to sell the Ordinary Shares from time to time, based upon instructions from the Company (including any price, time or amount limits the Company may impose). The Company is not obligated to make any sales under the Offering Agreement.
The Ordinary Shares were registered pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-262590), and offerings of the Ordinary Shares were made only by means of a prospectus supplement.
During the period ended September 30, 2026, we have sold 337,203 ordinary shares under the ATM program for gross proceeds of $413,000 at an average price of $1.22 per share. After deducting commissions related to the ATM offering of $13,000, the net proceeds we received from the transactions were $400,000. The proceeds from the ATM sales are being used for general corporate purposes.
AI Data Centers
The Company is currently exploring various opportunities to diversify our business into the AI data center industry, including the potential tokenization of AI data center revenue streams, the potential partnering with third parties to develop, own, and manage AI data center sites and equipment, and other businesses opportunities ancillary to the data center industry.
| 27 |
PRINCIPAL REVENUE AND EXPENSE ITEMS
Revenues
We derive our most significant revenues from three principal sources:
| ● | premiums assumed from reinsurance on property and casualty business; | |
| ● | income from investments and unrealized (loss) gain on other investments; | |
| ● | income from SurancePlus management fees. |
Premiums Assumed
Premiums assumed include all premiums received by a reinsurance company during a specified accounting period, even if the policy provides coverage beyond the end of the period. Premiums are earned over the term of the related policies. At the end of each accounting period, the portion of the premiums that are not yet earned are included in the unearned premiums reserve and are realized as revenue in subsequent periods over the remaining term of the policy. Our policies typically have a term of twelve months. Thus, for example, for a policy that is written on July 1, 2026, typically one-half of the premiums will be earned in 2026 and the other half will be earned during 2027. However, in the event of limit losses on our policies, premium recognition will be accelerated to match losses incurred in the period, when there is no possibility of any future treaty-year losses under the contracts.
Premiums from reinsurance on property and casualty business assumed are directly related to the number, type and pricing of contracts we write.
Premiums assumed are recorded net of change in loss experience refund, which consists of changes in amounts due to the cedants under our reinsurance contracts. These contracts contain retrospective provisions that adjust premiums in the event losses are minimal or zero. We recognize a liability pro-rata over the period in which the absence of loss experience obligates us to refund premiums under the contracts, and we will derecognize such liability in the period in which a loss experience arises. The change in loss experience refund is negatively correlated to loss and loss adjustment expenses described below.
Investment Income
Income from our investments is primarily comprised of net realized and unrealized (losses) gains interest income and dividends on investment securities. Such income is primarily from the Company’s investments, which includes investments held in trust accounts that collateralize the reinsurance policies that we write. The investment parameters for trust accounts are generally be established by the cedant for the relevant policy.
Incentive, Technology, Origination and Management Fee Income
During the year ended December 31, 2025, the Company’s subsidiary, SurancePlus, effectively entered into subscription agreements for the sale of ZetaCat Re and EtaCat Re Participation Shares representing fractionalized interest in reinsurance contracts underwritten by Oxbridge Re NS. The ZetaCat Re and EtaCat Re Tokens were issued on the Avalanche blockchain.
SurancePlus receives an incentive, technology, origination and management (“ITOM”) fee to cover costs associated with origination, structuring and the blockchain technology related to the ZetaCat Re and EtaCat Re Tokens.
| 28 |
Expenses
Our expenses consist primarily of the following:
| ● | losses and loss adjustment expenses; | |
| ● | policy acquisition costs and underwriting expenses; and | |
| ● | general and administrative expenses. |
Loss and Loss Adjustment Expenses
Loss and loss adjustment expenses are a function of the amount and type of reinsurance contracts we write and of the loss experience of the underlying coverage. As described below, loss and loss adjustment expenses are based on the claims reported by our Company’s ceding insurers, and may include an actuarial analysis of the estimated losses, including losses incurred during the period and changes in estimates from prior periods. Depending on the nature of the contract, loss and loss adjustment expenses may be paid over a period of years.
Policy Acquisition Costs and Underwriting Expenses
Policy acquisition costs and underwriting expenses consist primarily of brokerage fees, ceding commissions, premium taxes and other direct expenses that relate to our writing of reinsurance contracts. We amortize deferred acquisition costs over the related contract term.
General and Administrative Expenses
General and administrative expenses consist of salaries and benefits and related costs, including costs associated with our professional fees, rent and other general operating expenses consistent with operating as a public company.
| 29 |
RESULTS OF OPERATIONS
The following is our consolidated statement of operations and performance ratios for the three and nine month periods ended September, 2026 and 2025 (dollars in thousands, except per share amounts):
Three Months Ended September, 30 | Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue | ||||||||||||||||
| Assumed premiums | $ | - | $ | - | $ | 314 | $ | 2,222 | ||||||||
| Change in unearned premiums reserve | 86 | 555 | 696 | (490 | ) | |||||||||||
| Net premiums earned | 86 | 555 | 1,010 | 1,732 | ||||||||||||
| SurancePlus management fee income | - | - | 501 | 1 | ||||||||||||
| Net investment and other income | 175 | 79 | 312 | 251 | ||||||||||||
| Realized gain on other investments | - | - | - | 35 | ||||||||||||
| Unrealized loss on other investments | - | - | - | (20 | ) | |||||||||||
| Change in fair value of equity securities | - | 11 | - | 2 | ||||||||||||
| Total revenue | 261 | 645 | 1,823 | 2,001 | ||||||||||||
| Expenses | ||||||||||||||||
| Losses and loss adjustment expenses | - | - | - | 2,293 | ||||||||||||
| Policy acquisition costs and underwriting expenses | 9 | 61 | 114 | 191 | ||||||||||||
| General and administrative expenses | 638 | 754 | 1,763 | 2,515 | ||||||||||||
| Total expenses | 647 | 815 | 1,877 | 4,999 | ||||||||||||
| (Loss) before income / loss attributable to tokenholders and non-controlling interests | (386 | ) | (170 | ) | (54 | ) | (2,998 | ) | ||||||||
| (Income) loss attributable to tokenholders | (3 | ) | (2 | ) | (5 | ) | 697 | |||||||||
| (Loss) before (income) loss attributable to non-controlling interests | (389 | ) | (172 | ) | (59 | ) | (2,301 | ) | ||||||||
| (Income) loss attributable to non-controlling interests | (32 | ) | (15 | ) | (164 | ) | 102 | |||||||||
| Net loss attributable to ordinary shareholders | $ | (421 | ) | $ | (187 | ) | $ | (223 | ) | $ | (2,199 | ) | ||||
| Loss per share attributable to ordinary shareholders | ||||||||||||||||
| Basic and Diluted | $ | (0.05 | ) | $ | (0.02 | ) | $ | (0.03 | ) | $ | (0.30 | ) | ||||
| Performance ratios to net premiums earned | ||||||||||||||||
| Loss ratio | 0.0 | % | 0.0 | % | 0.0 | % | 132.4 | % | ||||||||
| Acquisition cost ratio | 10.5 | % | 11.0 | % | 11.3 | % | 11.0 | % | ||||||||
| Expense ratio | 752.3 | % | 146.8 | % | 185.8 | % | 156.2 | % | ||||||||
| Combined ratio | 752.3 | % | 146.8 | % | 185.8 | % | 288.6 | % | ||||||||
General. Net loss for the quarter ended September 30, 2026 was $421,000, or ($0.05) basic and diluted loss per share compared to a net loss of $187,000 or ($0.02) basic and diluted loss per share, for the quarter ended September 30, 2025. The increase in net loss is primarily due to a decline in net premiums earned for the period ended September 30, 2026, partially offset by higher net investment and other income and lower general and administrative expenses.
Net loss for the nine months ended September 30, 2026 was $223,000, or ($0.03) basic and diluted loss per share compared to a net loss of $2.19 million or ($0.30) basic and diluted loss per share, for the nine months ended September 30, 2025. The decrease in net loss is primarily due to a decrease in loss and loss adjustment expenses as there were no underwriting losses recorded for the period ended September 30, 2026. SurancePlus management fee income along with reduced professional fees and overall compensation contributed towards the decrease in net loss for the nine-month period ended September 30, 2026.
Premium Income. Net premiums earned typically reflects the pro rata inclusion into income of premiums assumed over the life of the reinsurance contracts.
Net premiums earned for the quarter ended September 30, 2026 decreased to $86,000 from $555,000 for the quarter ended September 30, 2025. The decrease is due to a lower amount of capital deployed into reinsurance contracts during the quarter when compared to the prior period.
Net premiums earned for the nine months ended September 30, 2026 decreased to $1.01 million from $1.73 million for the nine-month ended September 30, 2025. The decrease is due to a lower amount of capital deployed into reinsurance contracts during the nine-month period ended September 30, 2026 when compared to the prior period.
Losses Incurred. There were no losses incurred during the three-month period ending September 30, 2026 and 2025.
There were no losses incurred during the nine-month period ending September 30, 2026. During the nine- month period ending September 30, 2025, one of the reinsurance contracts experienced adverse loss development and a full limit loss of $2.3 million was recognized.
| 30 |
Policy Acquisition Costs. Acquisition costs represent the amortization of the brokerage fees and federal excise taxes incurred on reinsurance contracts placed. Policy acquisition costs for the three-months ending September 30, 2026 decreased to $9,000 from $61,000 for the quarter ending September 30, 2025. The decrease is due to the lower level of capital deployed in contracts in force in the quarter ended September 30, 2026, and the resulting acquisition costs, when compared to the rates on contracts in the prior-year period.
Policy acquisition costs for the nine-months ending September 30, 2026 decreased to $114,000 from $191,000 for the nine months ending September 30, 2025. The decrease is due to the to the lower level of capital deployed in contracts in force in the nine-months ended September 30, 2026, and the resulting acquisition costs, when compared to the rates on contracts in the prior-year period.
General and Administrative Expenses. General and administrative expenses for the quarter ended September 30, 2026 decreased to $638,000 from $754,000 for the quarter ended September 30, 2025. Reduced professional fees and overall compensation contributed toward the decrease for the quarter.
General and administrative expenses for the nine-months ended September 30, 2026 decreased to $1.8 million from $2.5 million for the nine-months ended September 30, 2025. Reduced professional fees and overall compensation contributed towards the decrease for the nine month period ended September 30, 2026.
MEASUREMENT OF RESULTS
We use various measures to analyze the growth and profitability of business operations. For our reinsurance business, we measure growth in terms of premiums assumed and we measure underwriting profitability by examining our loss, underwriting expense and combined ratios. We analyze and measure profitability in terms of net income and return on average equity.
Premiums Assumed. We use gross premiums assumed to measure our sales of reinsurance products. Gross premiums assumed also correlate to our ability to generate net premiums earned.
Loss Ratio. The loss ratio is the ratio of losses and loss adjustment expenses incurred to premiums earned and measures the underwriting profitability of our reinsurance business. The loss ratio remained consistent at 0% for the three-month period ended September 30, 2026 when compared with prior comparative period.
The loss ratio decreased to 0% from 132.4% for the nine-month period ended September 30, 2026 when compared with prior comparative period. This was due to no losses being recognized for the nine-month period ending September 30, 2026 whereas a full limit loss was recognized for one of the reinsurance contracts during the nine-month period ending September 30, 2025.
Acquisition Cost Ratio. The acquisition cost ratio is the ratio of policy acquisition costs to net premiums earned. The acquisition cost ratio measures our operational efficiency in producing, underwriting and administering our reinsurance business.
The acquisition cost ratio decreased marginally to 10.5% from 11% for the quarter ending September 30, 2026 when compared to prior comparable period. The decrease in acquisition cost ratio is due to reduced net premiums earned during the period ending September 30, 2026 when compared to prior comparable period.
The acquisition cost ratio increased marginally to 11.3% from 11% for the nine month period ending September 30, 2026 when compared to prior comparable period. The increase in acquisition cost ratio is due to reduced net premiums earned and marginal premium adjustments recognized during the period ending September 30, 2026 when compared to prior comparable period.
Expense Ratio. The expense ratio is the ratio of policy acquisition costs and general and administrative expenses to net premiums earned. We use the expense ratio to measure our operating performance. For the quarter ended September 30, 2026, the expense ratio increased to 752.3%, from 146.8% for the quarter ended September 30, 2025. The increase is primarily due to reduced net premiums earned during the quarter, when compared with the prior year period.
For the nine-month period ended September 30, 2026, the expense ratio increased to 185.8%, from 156.2% for the nine-month period ended September 30, 2025. The increase is primarily due to reduced net premiums earned during the nine months period ended September 30, 2026, when compared with the prior year period.
Combined Ratio. We use the combined ratio to measure our underwriting performance. The combined ratio is the sum of the loss ratio and the expense ratio. For the quarter ended September 30, 2026, the combined ratio increased to 752.3%, from 146.8% for the quarter ended September 30, 2025. The increase is primarily due to reduced net premiums earned during the quarter, when compared with the prior year period.
For the nine-month period ended September 30, 2026, the combined ratio decreased to 185.8%, from 288.6% for the nine-month period ended September 30, 2025. The decrease is primarily due to reduced net premiums earned during the nine months period ended September 30, 2026, when compared with the prior year period.
FINANCIAL CONDITION –September 30, 2026 COMPARED TO DECEMBER 31, 2025
Cash and cash equivalents, and restricted cash and cash equivalents. As of September 30, 2026, our restricted cash and cash equivalents increased by $12.59 million to $19.57 million, from $6.98 million as of December 31, 2025. The increase is the net result of the investment in the new tokenized securities, release of collateral from 25-26 reinsurance treaty contracts and premium deposits made during the nine months ending September 30, 2026.
Notes Payable to Noteholders. As of September 30, 2026, our notes payable remained at $118,000 as there were no redemptions during the period.
Mezzanine Equity – Tokenholders. As of September 30, 2026, amounts due to tokenholders increased to $12.6 million from $518,000 at December 31, 2025. The increase is due to the investment in new tokenized securities and the recognition of nine months of underwriting-relating income that is attributable to third-party tokenholders.
Unearned Premiums Reserve. As of September 30, 2026, our unearned premiums reserve decreased by $696,000, to $230,000 from $926,000 at December 31, 2025. The decrease is due to change in unearned premium reserves for the nine month period ended September 30, 2026.
| 31 |
LIQUIDITY AND CAPITAL RESOURCES
General
We are organized as a holding company and provide administrative and management services to our subsidiaries. Our operations are conducted through our reinsurance subsidiaries, Oxbridge Reinsurance Limited and Oxbridge Re NS and our web3 focused subsidiary SurancePlus Inc. which underwrites risks associated with our property and casualty reinsurance programs as well as the tokenization of RWAs such as Reinsurance contracts. We have minimal continuing cash needs at the holding company level, with such needs principally being related to the payment of administrative expenses and shareholder dividends. There are restrictions on Oxbridge Reinsurance Limited’s and Oxbridge Re NS’ ability to pay dividends which are described in more detail below.
Sources and Uses of Funds
Our sources of funds primarily consist of premium receipts (net of brokerage fees and federal excise taxes, where applicable) and investment income, including interest, dividends and realized gains. We use cash to pay losses and loss adjustment expenses, other underwriting expenses, dividends, and general and administrative expenses. Substantially all our surplus funds, net of funds required for cash liquidity purposes, are invested in accordance with our business plan and investment guidelines. Our current investment portfolio is primarily comprised of cash.
As of September 30, 2026, we believe we had sufficient cash flows from operations to meet our liquidity requirements in the short term. We expect that our operational needs for liquidity will be met by cash, investment income, sales under our existing ATM facilities, funds generated from underwriting activities and/or proceeds from the short-term loan we secured, which we settled in June 2026. We may issue debt in the foreseeable future to the extent the Company elects to proceed with the land acquisitions in amounts sufficient to finance the purchase of the properties it ultimately elects to acquire and we expect to fund our operations for the foreseeable future from operating cash flows, as well as from current and potential future equity offerings.
Although Oxbridge Re Holdings Limited is not subject to any significant legal prohibitions on the payment of dividends, its subsidiaries Oxbridge Reinsurance Limited and Oxbridge Re NS are subject to Cayman Islands regulatory constraints that affect its ability to pay dividends to us and include a minimum net worth requirement. Currently, the minimum net worth requirement for each subsidiary is $500. As of September 30, 2026, each subsidiary exceeded the minimum required. By law, each subsidiary is restricted from paying a dividend if such a dividend would cause its net worth to drop to less than the required minimum.
Cash Flows
Our cash flows from operating, investing, and financing activities for the nine-month periods ended September 30, 2026 and 2025 are summarized below.
Cash Flows for the nine months ended September 30, 2026 (in thousands)
Net cash used in operating activities for the nine-months ended September 30, 2026 totaled $374, which consisted primarily of cash received net written premiums less cash disbursed for operating expenses. Net cash provided by financing activities was $12.960 and primarily consisted of the proceeds from investment in new tokenized securities.
Cash Flows for the nine months ended September 30, 2025 (in thousands)
Net cash used in operating activities for the nine months ended September 30, 2025 totaled $1,781, which consisted primarily of cash received net written premiums less cash disbursed for operating expenses. Net provided by investing activities was $63, which consisted of consideration received on sale of our investment in Jet.AI. Net cash provided by financing activities was $3,001 which consisted of net proceeds from issuance of ordinary shares through the Company’s ATM facility and the registered direct offering completed during the period.
| 32 |
OFF-BALANCE SHEET ARRANGEMENTS
As of September 30, 2026, we had no off-balance sheet arrangements as defined in Item 303(a)(4) of Regulation S-K.
Exposure to Catastrophes
As with other reinsurers, our operating results and financial condition could be adversely affected by volatile and unpredictable natural and man-made disasters, such as hurricanes, windstorms, earthquakes, floods, fires, riots and explosions. Although we attempt to limit our exposure to levels, we believe are acceptable, it is possible that an actual catastrophic event or multiple catastrophic events could have a material adverse effect on our financial condition, results of operations and cash flows. As described under “CRITICAL ACCOUNTING POLICIES—Reserves for Losses and Loss Adjustment Expenses” below, under accounting principles generally accepted in the United States of America (‘‘GAAP’’), we are not permitted to establish loss reserves with respect to losses that may be incurred under reinsurance contracts until the occurrence of an event which may give rise to a claim. As a result, only loss reserves applicable to losses incurred up to the reporting date may be established, with no provision for a contingency reserve to account for expected future losses.
CRITICAL ACCOUNTING POLICIES
We are required to make estimates and assumptions in certain circumstances that affect amounts reported in our consolidated financial statements and related footnotes. We evaluate these estimates and assumptions on an on-going basis based on historical developments, market conditions, industry trends and other information that we believe to be reasonable under the circumstances. These accounting policies pertain to fair value measurements, premium revenues and risk transfer, reserve for loss and loss adjustment expenses, and deferred acquisition costs.
Fair value measurement: GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).
The three levels of the fair value hierarchy under GAAP are as follows:
Level 1 Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date;
Level 2 Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, including inputs in markets that are not considered to be active;
and
Level 3 Inputs that are unobservable.
Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. For fixed maturity securities, inputs may include price information, volatility statistics, specific and broad credit data, liquidity statistics, broker quotes for similar securities and other factors. The fair value of investments in stocks and exchange-traded funds is based on the last traded price. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires significant judgment by the Company’s investment custodians and management. The investment custodians and management consider observable data to be market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant markets.
Premium Revenue and Risk Transfer. We record premiums revenue as earned pro-rata over the terms of the reinsurance agreements and the unearned portion at the balance sheet date is recorded as unearned premiums reserve. A reserve is made for estimated premium deficiencies to the extent that estimated losses and loss adjustment expenses exceed related unearned premiums. Investment income is not considered in determining whether or not a deficiency exists.
We account for reinsurance contracts in accordance with ASC 944, ‘‘Financial Services – Insurance.” Assessing whether or not a reinsurance contract meets the conditions for risk transfer requires judgment. The determination of risk transfer is critical to reporting premiums written. If we determine that a reinsurance contract does not transfer sufficient risk, we must account for the contract as a deposit liability.
| 33 |
Reserves for Losses and Loss Adjustment Expenses. We determine our reserves for losses and loss adjustment expenses on the basis of the claims reported by our ceding insurers and for losses IBNR, we use the assistance of an independent actuary. The reserves for losses and loss adjustment expenses represent management’s best estimate of the ultimate settlement costs of all losses and loss adjustment expenses.
We believe that the amounts are adequate; however, the inherent impossibility of predicting future events with precision, results in uncertainty as to the amount which will ultimately be required for the settlement of losses and loss expenses, and the differences could be material. Adjustments are reflected in the consolidated statements of operations in the period in which they are determined.
Under GAAP, we are not permitted to establish loss reserves until the occurrence of an actual loss event. As a result, only loss reserves applicable to losses incurred up to the reporting date may be recorded, with no allowance for the provision of a contingency reserve to account for expected future losses. Losses arising from future events, which could be substantial, are estimated and recognized at the time the loss is incurred.
Our reserving methodology does not lend itself well to a statistical calculation of a range of estimates surrounding the best point estimate of our reserve for loss and loss adjustment expense. Due to the low frequency and high severity nature of claims within much of our business, our reserving methodology principally involves arriving at a specific point estimate for the ultimate expected loss on a contract-by-contract basis, and our aggregate loss reserves are the sum of the individual loss reserves established.
Deferred Acquisition Costs. We defer certain expenses that are directly related to and vary with producing reinsurance business, including brokerage fees on gross premiums assumed, premium taxes and certain other costs related to the acquisition of reinsurance contracts. These costs are capitalized and the resulting asset, deferred acquisition costs, is amortized and charged to expense in future periods as premiums assumed are earned. The method followed in computing deferred acquisition costs limits the amount of such deferral to its estimated realizable value. The ultimate recoverability of deferred acquisition costs is dependent on the continued profitability of our reinsurance underwriting. If our underwriting ceases to be profitable, we may have to write off a portion of our deferred acquisition costs, resulting in a further charge to income in the period in which the underwriting losses are recognized.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
As a smaller reporting company as defined by Rule 229.10(f)(1) of the Exchange Act, we are not required to provide the information under this item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our Chief Executive Officer (our principal executive officer) and our Chief Financial Officer (our principal financial officer), we have evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this Report on Form 10-Q (September 30, 2026). Our disclosure controls and procedures are intended to ensure that the information we are required to disclose in the reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including the principal executive officer and principal financial officer to allow timely decisions regarding required disclosures.
Based on that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered by this Report on Form 10-Q, our disclosure controls and procedures were effective.
It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system will be met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
| 34 |
PART II – OTHER INFORMATION
Item 1. Legal Proceedings
We are not currently involved in any litigation or arbitration. We anticipate that, similar to the rest of the insurance and reinsurance industry, we will be subject to litigation and arbitration in the ordinary course of business.
Item 1A. Risk Factors
There have been no material changes to our risk factors during the nine-months ended September 30, 2026.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
On June 22, 2026, the Company entered into an At-the-Market Sales Agreement (the “Offering Agreement”) with Chardan Capital Markets LLC, as sales agent (the “Sales Agent”), pursuant to which the Company could offer and sell, from time to time, through the Sales Agent, the Company’s ordinary shares, $0.001 par value (“Ordinary Shares”). The Company will pay the Sales Agent a commission equal to 3.0% of the gross proceeds of the Ordinary Shares sold by the Sales Agent pursuant to the Offering Agreement. The Company will also reimburse the Sales Agent for fees and disbursements of its legal counsel in an amount not to exceed $20,000 in connection with the execution of the Offering Agreement The Sales Agreement replaced our prior sales agreement dated July 9, 2025 with Maxim Group LLC, which was terminated on June 20, 2026.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
None.
Item 6. Exhibits
The following exhibits are filed herewith:
| Exhibit No. | Document | |
| 31.1 | Certifications of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act and Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934. | |
| 31.2 | Certifications of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act and Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934. | |
| 32 | Written Statement of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. §1350. | |
| 101 | The following materials from Oxbridge Re Holdings Limited’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2026 are filed herewith, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Cash Flows, (iv) the Consolidated Statements of Changes in Shareholders’ Equity and (vs) the Notes to Consolidated Financial Statements. |
| 35 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| OXBRIDGE RE HOLDINGS LIMITED | ||
| Date: November 9, 2026 | By: | /s/ JAY MADHU |
| Jay Madhu | ||
Chief Executive Officer and President (Principal Executive Officer) | ||
| Date: November 9, 2026 | By: | /s/ WRENDON TIMOTHY |
| Wrendon Timothy | ||
Chief Financial Officer and Secretary (Principal Financial Officer and Principal Accounting Officer) | ||
| 36 |