Note 2 - Investments

12 Months Ended

Dec. 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 December 31 is as follows:

	December 31, 2022
	Cost or		Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses			Fair Value
Available for sale:
Fixed maturities:
US Treasury securities	$	993,805	$	36,313	$	(5,031	)	$	1,025,087
Corporate bonds		19,018,738		722		(3,150,382	)		15,869,078
Municipal bonds		6,228,636		-		(808,227	)		5,420,409
Redeemable preferred stock		3,875,526		-		(519,911	)		3,355,615
Term loans		18,086,124		209,989		(146,395	)		18,149,718
Mortgage backed and asset backed securities		22,412,895		157,795		(1,074,520	)		21,496,170
Total available for sale	$	70,615,724	$	404,819	$	(5,704,466	)	$	65,316,077

	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 December 31, 2022 and 2021, by contractual maturity, is as follows. 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 December 31, 2022				As of December 31, 2021
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Amounts maturing in:
One year or less	$	442,846	$	450,461	$	-	$	-
After one year through five years		17,048,721		17,035,270		1,987,421		2,087,132
After five years through ten years		5,498,364		5,340,498		2,540,089		2,865,020
More than 10 years		21,337,372		17,638,063		21,479,533		23,780,250
Redeemable preferred stocks		3,875,526		3,355,615		3,612,625		3,621,526
Mortgage backed and asset backed securities		22,412,895		21,496,170		5,636,371		5,588,729
Total amortized cost and fair value	$	70,615,724	$	65,316,077	$	35,256,039	$	37,942,657

Proceeds from the sale of securities, maturities, and asset paydowns in 2022 and 2021 were $9,878,340 and $4,769,831, respectively. Realized gains and losses related to the sale of securities are summarized as follows:

	Year Ended December 31,
	2022			2021
Gross gains	$	24,720		$	248,891
Gross losses		(133,363	)		(18,899	)
Realized gains (losses)	$	(108,643	)	$	229,992

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
December 31, 2022
Available for sale:
Fixed maturities:
US Treasury securities	$	398,375	$	(5,031	)	$	-	$	-		$	398,375	$	(5,031	)
Corporate bonds		12,378,486		(1,883,706	)		3,206,913		(1,266,676	)		15,585,399		(3,150,382	)
Municipal bonds		4,711,895		(587,053	)		708,514		(221,174	)		5,420,409		(808,227	)
Redeemable preferred stock		2,384,771		(363,193	)		970,844		(156,718	)		3,355,615		(519,911	)
Term loans		6,309,005		(146,395	)		-		-			6,309,005		(146,395	)
Mortgage backed and asset backed securities		10,358,560		(458,754	)		3,281,132		(615,766	)		13,639,692		(1,074,520	)
Total fixed maturities	$	36,541,092	$	(3,444,132	)	$	8,167,403	$	(2,260,334	)	$	44,708,495	$	(5,704,466	)

	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 December 31, 2022 was 230, which represented an unrealized loss of $5,704,466 of the aggregate carrying value of those securities. The 230 securities breakdown as follows: 131 bonds, 73 mortgage and asset backed securities, 10 term loans, and 16 redeemable preferred stock. The Company determined that no securities were considered to be other-than-temporarily impaired as of December 31, 2022 and 2021.

Mortgage Loans on Real Estate

The Company’s mortgage loans by property type as of December 31, 2022 and December 31, 2021 are summarized as follows:

	December 31, 2022		December 31, 2021
Commercial mortgage loans by property type
Condominium	$	1,696,975	$	1,960,547
Land		1,902,277		-
Multi-property		9,539,738		1,157,950
Multi-family		5,016,424		534,645
Retail/Office		5,634,659		-
Total commercial mortgages	$	23,790,073	$	3,653,142

The Company’s mortgage loans by loan-to-value ratio as of December 31, 2022 and December 31, 2021 are summarized as follows:

	December 31, 2022		December 31, 2021
Loan to value ratio
Over 70 to 80%	$	8,219,763	$	-
Over 60 to 70%		5,196,975		1,960,547
Over 50 to 60%		4,682,750		-
Over 40 to 50%		3,235,951		339,335
Over 30 to 40%		-		195,310
Over 20 to 30%		1,319,975		-
Over 10 to 20%		1,134,659		1,157,950
Total	$	23,790,073	$	3,653,142

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

	December 31, 2022		December 31, 2021
Maturity Date
One year or less	$	15,354,542	$	2,155,857
After one year through five years		8,435,531		1,497,285
Total	$	23,790,073	$	3,653,142

Investment Income, Net of Expenses

The components of net investment income for the years ended December 31, 2022 and 2021 are as follows:

	Years Ended December 31,
	2022			2021
Fixed maturities	$	2,159,129		$	1,121,170
Mortgages		758,362			378,035
Equity securities		669,721			617,198
Funds withheld		1,581,453			3,421,796
Other invested assets		47,241			-
Cash and cash equivalents		47,285			1,794
		5,263,191			5,539,993
Less investment expenses		(464,992	)		(203,945	)
	$	4,798,199		$	5,336,048

Net Investment Gains (losses)

Accounting standards require that the unrealized gains and losses on equity securities be reported as income on the consolidated statements of comprehensive income (loss). For the year ended December 31, 2022, net investment losses is comprised of $1,638,847 of unrealized losses on our equity portfolio, net realized losses of $108,643, and a loss on the change in the fair value of our embedded derivatives of $177,596. For the year ended December 31, 2021, net investment gains is comprised of $20,814 of unrealized gains on our equity portfolio, net realized gains of $229,992, and a loss on the change in the fair value of our embedded derivative of $108,526.