Investments

The cost or amortized cost, gross unrealized gain or loss, and estimated fair value of the investments in securities classified as available-for-sale at September 30, 2015 and December 31, 2014 were as follows (in thousands):

	September 30, 2015
	Cost or Amortized Cost		Gross Unrealized					Estimated Fair Value
	Cost or Amortized Cost		Gains		Losses			Estimated Fair Value
Fixed Securities:
U.S. Government obligations	$	5,485	$	72	$	(1	)	$	5,556
State and local government		14,492		270		(41	)		14,721
Corporate debt		34,006		206		(193	)		34,019
Commercial mortgage and asset-backed		43,000		371		(101	)		43,270
Total fixed securities available for sale		96,983		919		(336	)		97,566
Equity Securities:
Common stock		3,324		849		(143	)		4,030
Total equity securities available for sale		3,324		849		(143	)		4,030
Total securities available for sale	$	100,307	$	1,768	$	(479	)	$	101,596

	December 31, 2014
	Cost or Amortized Cost		Gross Unrealized					Estimated Fair Value
	Cost or Amortized Cost		Gains		Losses			Estimated Fair Value
Fixed Securities:
U.S. Government obligations	$	5,872	$	85	$	(16	)	$	5,941
State and local government		10,755		210		(4	)		10,961
Corporate debt		30,818		237		(106	)		30,949
Commercial mortgage and asset-backed		36,323		348		(117	)		36,554
Total fixed securities available for sale		83,768		880		(243	)		84,405
Equity Securities:
Common stock		2,965		1,158		(39	)		4,084
Total equity securities available for sale		2,965		1,158		(39	)		4,084
Total securities available for sale	$	86,733	$	2,038	$	(282	)	$	88,489

The following table summarizes the aggregate fair value and gross unrealized losses, by security type, of the available-for-sale securities in unrealized loss positions. The table segregates the holdings based on the length of time that individual securities have been in a continuous unrealized loss position, as follows (in thousands, except number of issues):

	September 30, 2015
	Less than 12 months							Greater than 12 months							Total
	Number of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses			Number of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses			Number of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses
Fixed Securities:
U.S. Government obligations		-	$	-	$	-			2	$	684	$	(1	)		2	$	684	$	(1	)
State and local government		11		3,173		(41	)		-		-		-			11		3,173		(41	)
Corporate debt		38		11,005		(178	)		9		1,536		(15	)		47		12,541		(193	)
Commercial mortgage and asset-backed		33		12,826		(70	)		4		1,860		(31	)		37		14,686		(101	)
Total fixed securities available for sale		82		27,004		(289	)		15		4,080		(47	)		97		31,084		(336	)
Equity Securities:
Common stock		95		949		(121	)		3		43		(22	)		98		992		(143	)
Total equity securities available for sale		95		949		(121	)		3		43		(22	)		98		992		(143	)
Total securities		177	$	27,953	$	(410	)		18	$	4,123	$	(69	)		195	$	32,076	$	(479	)

	December 31, 2014
	Less than 12 months							Greater than 12 months							Total
	Number of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses			Number of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses			Number of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses
Fixed Securities:
U.S. Government obligations		-	$	-	$	-			3	$	1,319	$	(16	)		3	$	1,319	$	(16	)
State and local government		4		552		(1	)		3		825		(3	)		7		1,377		(4	)
Corporate debt		61		18,835		(98	)		3		489		(8	)		64		19,324		(106	)
Commercial mortgage and asset-backed		23		12,060		(34	)		10		4,999		(83	)		33		17,059		(117	)
Total fixed securities available for sale		88		31,447		(133	)		19		7,632		(110	)		107		39,079		(243	)
Equity Securities:
Common stock		20		347		(39	)		-		-		-			20		347		(39	)
Total equity securities available for sale		20		347		(39	)		0		-		-			20		347		(39	)
Total securities		108	$	31,794	$	(172	)		19	$	7,632	$	(110	)		127	$	39,426	$	(282	)

Substantially all of the Company’s fixed maturity securities are of investment grade with an average credit quality of AA. The fixed maturity securities are short in duration; approximately 3.4 and 3.1 years as of September 30, 2015 and December 31, 2014, respectively.

The Company reviews its impaired securities for possible other-than-temporary impairment (“OTTI”) at each quarter end. A security has an impairment loss when its fair value is less than its cost or amortized cost at the balance sheet date. The Company analyzed its investment portfolio in accordance with its OTTI review procedures and determined the Company did not need to record a credit related OTTI loss, nor recognize a non-credit related OTTI loss in other comprehensive income for the three and nine months ended September 30, 2015 and 2014. The Company’s conclusion is based on the following: (i) as of the specified date, all contractual interest and principal payments on the fixed maturity securities have been received, (ii) there is no intent to sell the securities, (iii) it is more likely than not that the Company will not be required to sell the securities before recovery of their amortized cost or cost bases and (iv) the unrealized loss relates to non-credit factors, such as interest rate changes and fluctuations due to market conditions.

The Company’s sources of net investment income are as follows (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Fixed maturity securities	$	551		$	348		$	1,614		$	898
Equity securities		24			21			69			56
Cash and short-term investments		-			3			4			7
Total investment income		575			372			1,687			961
Investment expenses		(70	)		(51	)		(227	)		(138	)
Net investment income	$	505		$	321		$	1,460		$	823

The following table summarizes the gross realized gains and losses from sales or maturities of available-for-sale fixed maturity and equity securities, as follows (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Fixed maturity securities:
Gross realized gains	$	6		$	(4	)	$	74		$	18
Gross realized losses		(1	)		14			(5	)		(14	)
Total fixed securities		5			10			69			4

Equity securities:
Gross realized gains		30			106			233			299
Gross realized losses		(29	)		(22	)		(64	)		(37	)
Total equity securities		1			84			169			262

Total realized gains (losses)	$	6		$	94		$	238		$	266

Proceeds from the sales of debt and equity securities available for sale were $6.8 million and $4.3 million for the nine months ended September 30, 2015 and 2014, respectively.

The table below summarizes the amortized cost and fair value of available-for-sale fixed maturity securities by contractual maturity at September 30, 2015. Actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties (in thousands):

	Amortized Cost		Estimated Fair Value
Due in one year or less	$	4,595	$	4,614
Due after one year through five years		32,405		32,593
Due after five years through ten years		7,714		7,794
Due after ten years		9,269		9,295
Securities with contractual maturities		53,983		54,296
Commercial mortgage and asset backed		43,000		43,270
Total Fixed maturity securities	$	96,983	$	97,566

At September 30, 2015 and December 31, 2014, the insurance companies had an aggregate of $7.5 million and $7.0 million, respectively, on deposit in trust accounts to meet the deposit requirements of various state insurance departments. There are withdrawal and other restrictions on these deposits, including the type of investments that may be held, however the Company may generally invest in high-grade bonds and short-term investments and earn interest on the funds.