Note 13. Commitments and Contingencies

Operating Leases

The Company leases facilities, equipment and vehicles under non-cancelable operating leases with various expiration dates through April 2029. Monthly lease payments range from $25 to $26,144. Total rental expense for the years ended  October 31, 2021 and October 31, 2020 was $4.4 million, which also includes the Company’s month-to-month leases.

The following is a summary of future minimum lease payments for the years ended October 31:

 Capital Leases

The Company has a limited number of capital leases related to land and buildings. The capital lease obligation recorded as of  October 31, 2021 was $0.4 million while the net book value of the leased assets as of October 31, 2020 was $0.5 million.

The following is a summary of future minimum lease payments together with the present value of those payments for the years ended October 31:

Insurance

For the years ended October 31, 2021 and October 31, 2020, the Company was partially insured for automobile, general and worker's compensation liability with the following deductibles (per occurrence):

The Company has accrued $4.5 million and $5.4 million, as of October 31, 2021 and at October 31, 2020, respectively, for claims incurred but not reported and estimated losses reported, which is included in accrued expenses and other current liabilities in the accompanying consolidated balance sheets.

The Company offers employee health benefits via a partially self-insured medical benefit plan. Participant claims exceeding certain limits are covered by a stop-loss insurance policy. As of October 31, 2021 and at October 31, 2020, the Company had accrued $1.6 million and $2.4 million, respectively, for health claims incurred but not reported based on historical claims amounts and average lag time. These accruals are included in accrued expenses and other current liabilities in the accompanying consolidated balance sheets. The Company contracts with a third-party administrator to process claims, remit benefits, etc. As of October 31, 2021, the third party administrator no longer requires the Company to maintain a bank account to facilitate the administration of claims but the Company was required to maintain a bank account in fiscal 2020. The account balance was $0.3 million as of October 31, 2020 and was included in cash and cash equivalents in the accompanying consolidated balance sheets.

Litigation

The Company is currently involved in certain legal proceedings and other disputes with third parties that have arisen in the ordinary course of business. Management believes that the outcomes of these matters will not have a material impact on the Company’s financial statements and does not believe that any amounts need to be recorded for contingent liabilities in the Company’s consolidated balance sheet.

Letters of credit

The ABL Facility provides for up to $7.5 million of standby letters of credit. As of October 31, 2021, total outstanding letters of credit totaled $2.3 million, the vast majority of which had been committed to the Company’s general liability insurance provider.