Deferred Acquisition Costs and Deferred Ceding

12 Months Ended

Dec. 31, 2011

Notes to Financial Statements

Note 9. Deferred Acquisition Costs and Deferred Ceding Commission Revenue

Acquisition costs incurred and policy-related ceding commission revenue are deferred, and amortized to income on property and casualty insurance business as follows:

	Year ended
	December 31,
	2011			2010
Net deferred acquisition costs net of ceding
commission revenue, beginning of year	$	399,488		$	(380,261	)
Cost incurred and deferred:
Commissions and brokerage		6,863,504			5,558,031
Other underwriting and acquisition costs		2,316,928			1,809,372
Ceding commission revenue		(7,678,913	)		(6,240,967	)
Net deferred acquisition costs		1,501,519			1,126,436
Amortization		(1,347,634	)		(346,687	)
		153,885			779,749
Net deferred acquisition costs net of ceding
commission revenue, end of year	$	553,374		$	399,488

Ending balances for deferred acquisition costs and deferred ceding commission revenue as of December 31, 2011 and 2010 follows:

	December 31,
	2011			2010
Deferred acquisition costs	$	4,535,773		$	3,619,001
Deferred ceding commission revenue		(3,982,399	)		(3,219,513	)
Balance at end of period	$	553,374		$	399,488