Note 2 - Investments

3 Months Ended

Mar. 31, 2022

Notes to Financial Statements

Investment Holdings [Text Block]

Note 2. Investments

Fixed Maturity

The amortized cost and fair value of available for sale investments as of March 31, 2022 and December 31, 2021 is as follows:

	March 31, 2022
	Cost or		Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses			Fair Value
	(unaudited)
Available for sale:
Fixed maturities:
US Treasury securities	$	303,323	$	118,186	$	-		$	421,509
Corporate bonds		19,585,022		528,783		(783,127	)		19,330,678
Municipal bonds		6,225,836		223,399		(136,324	)		6,312,911
Redeemable preferred stock		4,052,415		6,148		(145,617	)		3,912,946
Mortgage backed and asset backed securities		5,747,087		1,534		(344,426	)		5,404,195
Total available for sale	$	35,913,683	$	878,050	$	(1,409,494	)	$	35,382,239

	December 31, 2021
	Cost or		Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses			Fair Value
Available for sale:
Fixed maturities:
US Treasury securities	$	303,195	$	144,570	$	-		$	447,765
Corporate bonds		19,397,461		2,101,518		(177,700	)		21,321,279
Municipal bonds		6,306,387		671,263		(14,292	)		6,963,358
Redeemable preferred stock		3,612,625		29,995		(21,094	)		3,621,526
Mortgage backed and asset backed securities		5,636,371		22,617		(70,259	)		5,588,729
Total available for sale	$	35,256,039	$	2,969,963	$	(283,345	)	$	37,942,657

The amortized cost and fair value of debt securities as of March 31, 2022 and December 31, 2021, by contractual maturity, are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	As of March 31, 2022				As of December 31, 2021
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Amounts maturing in:
One year or less	$	305,632	$	315,121	$	-	$	-
After one year through five years		1,874,111		1,882,969		1,987,421		2,087,132
After five years through ten years		2,346,784		2,453,756		2,540,089		2,865,020
More than 10 years		21,587,654		21,413,252		21,479,533		23,780,250
Redeemable preferred stocks		4,052,415		3,912,946		3,612,625		3,621,526
Mortgage backed and asset backed securities		5,747,087		5,404,195		5,636,371		5,588,729
Total amortized cost and fair value	$	35,913,683	$	35,382,239	$	35,256,039	$	37,942,657

Proceeds from the sale of securities, maturities, and asset paydowns in the three months ended March 31, 2022 and 2021 were $3,042,470 and $360,187, respectively. Realized gains and losses related to the sale of securities are summarized as follows:

	Three Months Ended March 31,
	(unaudited)
	2022			2021
Gross gains	$	1,900		$	52,792
Gross losses		(2,541	)		(395	)
Realized gains (losses)	$	(641	)	$	52,397

Gross unrealized losses by duration are summarized as follows:

	Less than 12 months					Greater than 12 months					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Loss			Value		Loss			Value		Loss
March 31, 2022
	(unaudited)
Available for sale:
Fixed maturities:
Corporate bonds	$	5,384,361	$	(218,165	)	$	3,195,514	$	(564,962	)	$	8,579,875	$	(783,127	)
Municipal bonds		1,041,440		(130,162	)		102,397		(6,162	)		1,143,837		(136,324	)
Redeemable preferred stock		3,598,631		(145,617	)		-		-			3,598,631		(145,617	)
Mortgage backed and asset backed securities		4,182,609		(258,949	)		932,518		(85,477	)		5,115,127		(344,426	)
Total fixed maturities	$	14,207,041	$	(752,893	)	$	4,230,429	$	(656,601	)	$	18,437,470	$	(1,409,494	)

	Less than 12 months					Greater than 12 months				Total
	Fair		Unrealized			Fair		Unrealized		Fair		Unrealized
	Value		Loss			Value		Loss		Value		Loss
December 31, 2021
Available for sale:
Fixed maturities:
Corporate bonds	$	4,496,456	$	(177,700	)	$	-	$	-	$	4,496,456	$	(177,700	)
Municipal bonds		927,122		(14,292	)		-		-		927,122		(14,292	)
Redeemable preferred stock		1,394,650		(21,094	)		-		-		1,394,650		(21,094	)
Mortgage backed and asset backed securities		4,386,306		(70,259	)		-		-		4,386,306		(70,259	)
Total fixed maturities	$	11,204,534	$	(283,345	)	$	-	$	-	$	11,204,534	$	(283,345	)

Unrealized losses occur from market price declines that may be due to a number of factors, including economic downturns, changes in interest rates, competitive forces within an industry, issuer specific events, operational difficulties, lawsuits, and market pricing anomalies caused by factors such as temporary lack of liquidity.

The total number of available for sale securities in the investment portfolio in an unrealized loss position as of March 31, 2022 was 129, which represented an unrealized loss of $1,409,494 of the aggregate carrying value of those securities. The 129 securities breakdown as follows: 54 bonds, 60 mortgage and asset backed securities, and 15 redeemable preferred stock. The total number of available for sale securities in the investment portfolio in an unrealized loss position as of December 31, 2021 was 76, which represented an unrealized loss of $283,345 of the aggregate carrying value of those securities. The 76 securities breakdown as follows: 29 bonds, 41 mortgage and asset backed securities, and 6 redeemable preferred stock.The Company determined that no securities were considered to be other-than-temporarily impaired as of March 31, 2022 and December 31, 2021.

Mortgage Loans on Real Estate

The Company has invested in various mortgage loans through participation agreements with the original issuing entity.  The Company’s mortgage loans by property type as of March 31, 2022 and December 31, 2021 are summarized as follows:

	March 31, 2022		December 31, 2021
	(unaudited)
Commercial mortgage loans by property type
Condominium	$	1,323,740	$	1,960,547
Multi-property		1,564,501		1,157,950
Multi-family		337,971		534,645
Total commercial mortgages	$	3,226,212	$	3,653,142

The Company utilizes loan-to-value of individual mortgage loans to evaluate the credit quality of its mortgage loan portfolio.  The loan-to-value measures the loan's carrying value to its appraised value.  The Company’s mortgage loans by loan-to-value ratio as of March 31, 2022 and December 31, 2021 are summarized as follows:

	March 31, 2022		December 31, 2021
	(unaudited)
Loan to value ratio
Over 60 to 70%	$	1,323,740	$	1,960,547
Over 40 to 50%		337,971		339,335
Over 30 to 40%		-		195,310
Over 10 to 20%		1,564,501		1,157,950
Total	$	3,226,212	$	3,653,142

The Company’s mortgage loans by maturity date as of March 31, 2022 and December 31, 2021 are summarized as follows:

	March 31, 2022		December 31, 2021
	(unaudited)
Maturity Date
One year or less	$	1,323,740	$	2,155,857
After one year through five years		1,902,472		1,497,285
Total	$	3,226,212	$	3,653,142

The Company had no mortgage loans that were on non-accrued status as of March 31, 2022 and December 31, 2021.  The were no mortgage loans delinquent on payments due the Company as of March 31, 2022 and December 31, 2021.  In addition, the Company did not establish a valuation allowance on any mortgage loans as of March 31, 2022 and December 31, 2021.

Investment Income, Net of Expenses

The components of net investment income for the three months ended March 31, 2022 and 2021 are as follows:

	Three Months Ended March 31,
	2022			2021
	(unaudited)
Fixed maturities	$	275,333		$	277,489
Mortgages		27,391			72,917
Equity securities		154,674			147,931
Funds withheld		700,308			827,997
Cash and cash equivalents		460			308
		1,158,166			1,326,642
Less investment expenses		(6,544	)		(27,650	)
	$	1,151,622		$	1,298,992

Net Investment Gains

Accounting standards require that the unrealized gains and losses on equity securities be reported as income on the consolidated statements of comprehensive loss. For the three months ended March 31, 2022, net investment losses is comprised of $449,795 of unrealized losses on our equity portfolio, net realized losses of $641, and a loss on the change in the fair value of our embedded derivative on funds withheld of $282,217. For the three months ended March 31, 2021, net investment losses is comprised of $32,918 of unrealized gains on our equity portfolio, net realized gains of $52,397 and a loss on the change in the fair value of our embedded derivative on funds withheld of $202,647.