Investments (Tables)

12 Months Ended

Dec. 31, 2020

Investments Tables Abstract

Summary of investment income and net realized gains

A summary of investment income, net of investment expenses, net realized gains, and net unrealized investment gains on equity securities is as follows:

	Year ended December 31
	2020			2019
Fixed maturities	$	2,068,592		$	2,162,142
Equities		28,727			—
Short-term investments and cash equivalents		24,603			65,642
Gross investment income		2,121,922			2,227,784
Less investment expenses		(133,679	)		(129,842	)
Net investment income		1,988,243			2,097,942
Net realized gains (losses)		97,771			(12,661	)
Net unrealized gains on equity securities		198,266			—
Net investment income, realized gains (losses) and unrealized gains	$	2,284,280		$	2,085,281

Investments by contractual maturity

The amortized cost and estimated fair value of fixed maturity investments at December 31, 2020, by contractual maturity are as follows:

	Amortized Cost		Estimated Fair Value
Due in one year or less	$	11,064,202	$	11,169,232
Due after one year through five years		30,090,910		31,260,694
Due after five years through ten years		18,476,051		19,806,444
Due after ten years and beyond		21,238,117		21,971,324
Total fixed maturities	$	80,869,280	$	84,207,694

Investments by amortized cost and estimated fair value

The amortized cost and estimated fair values of investments in fixed maturities by category are as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
December 31, 2020
Available-for-sale fixed maturities:
U.S. Treasury securities	$	10,596,808	$	235,373	$	—		$	10,832,181
Corporate securities		44,159,926		2,347,826		(55,847	)		46,451,905
Agency mortgage-backed securities		25,314,546		833,336		(22,274	)		26,125,608
Held-to-maturity fixed maturities:
Certificates of deposit		798,000		—		—			798,000
Total fixed maturities	$	80,869,280	$	3,416,535	$	(78,121	)	$	84,207,694
December 31, 2019
Available-for-sale fixed maturities:
U.S. Treasury securities	$	15,105,795	$	130,564	$	(1,027	)	$	15,235,332
Corporate securities		41,953,378		1,076,012		(57	)		43,029,333
Agency mortgage-backed securities		24,943,238		293,757		(1,950	)		25,235,045
Held-to-maturity fixed maturities:
Certificates of deposit		798,000		—		—			798,000
Total fixed maturities	$	82,800,411	$	1,500,333	$	(3,034	)	$	84,297,710

Summary of unrealized appreciation (depreciation) on investments

A summary of the unrealized gains (losses) on investments carried at fair value and the applicable deferred federal income taxes is as follows:

	Year ended December 31
	2020			2019
Gross unrealized gains of fixed maturities	$	3,416,535		$	1,500,333
Gross unrealized losses of fixed maturities		(78,121	)		(3,034	)
Net unrealized gains on investments		3,338,414			1,497,299
Deferred federal tax expense		(701,067	)		(314,433	)
Net unrealized gains, net of deferred income taxes	$	2,637,347		$	1,182,866

Components of investments in unrealized loss position for continuous period of time

A summary of estimated fair value and gross unrealized losses in a gross unrealized loss position by the length of time in which the securities have continually been in that position is shown below:

	Less than 12 Months							12 Months or Longer
	Estimated Fair Value		Gross Unrealized Losses			Number of Securities		Estimated Fair Value		Gross Unrealized Losses		Number of Securities
December 31, 2020
U.S. Treasury securities	$	—	$	—			—	$	—	$	—		—
Corporate securities		2,101,986		(55,847	)		2		—		—		—
Agency mortgage-backed securities		3,223,329		(22,274	)		12		—		—		—
Total debt securities		5,325,315		(78,121	)		14		—		—		—
Equity securities		723,346		(37,357	)		25		—		—		—
Total	$	6,048,661	$	(115,478	)		39	$	—	$	—		—

	Less than 12 Months							12 Months or Longer
	Estimated Fair Value		Gross Unrealized Losses			Number of Securities		Estimated Fair Value		Gross Unrealized Losses			Number of Securities
December 31, 2019
U.S. Treasury securities	$	1,996,562	$	(253	)		1	$	1,002,031	$	(775	)		1
Corporate securities		999,818		(56	)		1		—		—			—
Agency mortgage-backed securities		750,058		(1,950	)		2		—		—			—
Total	$	3,746,438	$	(2,259	)		4	$	1,002,031	$	(775	)		1

Fixed maturities sold and called

Although the Company does not intend to sell its fixed maturity investments prior to maturity, the Company may sell investment securities from time to time in response to cash flow requirements, economic and/or market conditions or investment securities may be called by their issuers prior to the securities’ maturity.

	December 31		December 31
	2020		2019
Fixed maturities securities sold
Number of securities sold		15		3
Amortized cost of sold securities	$	5,529,470	$	2,997,098
Realized gains (losses) on sales	$	52,053	$	(12,679	)
Fixed maturities securities called
Number of securities called		4		1
Amortized cost of called securities	$	2,449,503	$	999,982
Realized gains on calls	$	497	$	18

Summary of equity investments

The Company started investing in common stock equity securities during the year ended December 31, 2020. The Company’s equity securities allocation is intended to enhance the return of and provide diversification for the total investment portfolio. A summary of equity securities is shown below:

	December 31		December 31
	2020		2019
Cost	$	2,548,440	$	—
Unrealized gain		198,266		—
Fair market value of equity securities	$	2,746,706	$	—

Summary of state held deposits

The following securities from three different banks represent statutory deposits that are assigned to and held by the California State Treasurer and the Insurance Commissioner of the State of Nevada. These deposits are required for writing certain lines of business in California and for admission in the state of Nevada.

	Year ended December 31
	2020		2019
Certificates of deposit	$	200,000	$	200,000
Short-term investments		200,000		200,000
Total state held deposits	$	400,000	$	400,000

Summary of short term investments

Short-term investments have an initial maturity of one year or less and consist of the following:

	Year ended December 31
	2020		2019
U.S. Treasury bills	$	—	$	1,996,815
Certificates of deposit		200,000		200,000
Total short-term investments	$	200,000	$	2,196,815