3. Investments (Tables)

9 Months Ended

Sep. 30, 2013

Notes to Financial Statements

Schedule of Availalbe for Sale Securities

The amortized cost and fair value of investments in available-for-sale fixed-maturity securities and equity securities as of September 30, 2013 and December 31, 2012 are summarized as follows:

	September 30, 2013
													Net
	Cost or		Gross		Gross Unrealized Losses								Unrealized
	Amortized		Unrealized		Less than 12			More than 12			Fair		Gains/
Category	Cost		Gains		Months			Months			Value		(Losses)
	(unaudited)
Fixed-Maturity Securities:
Political subdivisions of States,
Territories and Possessions	$	6,389,133	$	185,758	$	(73,124	)	$	(3,833	)	$	6,497,934	$	108,801
Corporate and other bonds
Industrial and miscellaneous		18,464,057		599,438		(207,697	)		(2,309	)		18,853,489		389,432
Total fixed-maturity securities		24,853,190		785,196		(280,821	)		(6,142	)		25,351,423		498,233
Equity Securities:
Preferred stocks		2,917,202		2,378		(263,351	)		-			2,656,229		(260,973	)
Common stocks		3,758,464		461,387		(86,356	)		-			4,133,495		375,031
Total equity securities		6,675,666		463,765		(349,707	)		-			6,789,724		114,058
Total	$	31,528,856	$	1,248,961	$	(630,528	)	$	(6,142	)	$	32,141,147	$	612,291

	December 31, 2012
													Net
	Cost or		Gross		Gross Unrealized Losses								Unrealized
	Amortized		Unrealized		Less than 12			More than 12			Fair		Gains/
Category	Cost		Gains		Months			Months			Value		(Losses)
Fixed-Maturity Securities:
Political subdivisions of States,
Territories and Possessions	$	5,219,092	$	257,298	$	(1,574	)	$	-		$	5,474,816	$	255,724
Corporate and other bonds
Industrial and miscellaneous		19,628,005		1,123,392		(43,553	)		(722	)		20,707,122		1,079,117
Total fixed-maturity securities		24,847,097		1,380,690		(45,127	)		(722	)		26,181,938		1,334,841
Equity Securities:
Preferred stocks		1,475,965		19,512		(11,130	)		-			1,484,347		8,382
Common stocks		3,598,012		353,782		(145,899	)		-			3,805,895		207,883
Total equity securities		5,073,977		373,294		(157,029	)		-			5,290,242		216,265
Total	$	29,921,074	$	1,753,984	$	(202,156	)	$	(722	)	$	31,472,180	$	1,551,106

Schedule of Availalbe for Sale Securities by contractual maturity

A summary of the amortized cost and fair value of the Company’s investments in available-for-sale fixed-maturity securities by contractual maturity as of September 30, 2013 and December 31, 2012 is shown below:

	September 30, 2013				December 31, 2012
	Amortized				Amortized
Remaining Time to Maturity	Cost		Fair Value		Cost		Fair Value
	(unaudited)
Less than one year	$	1,012,528	$	1,027,959	$	546,952	$	560,162
One to five years		8,510,310		8,936,702		9,031,248		9,569,943
Five to ten years		11,577,308		11,714,251		12,605,798		13,306,033
More than 10 years		3,753,044		3,672,511		2,663,099		2,745,800
Total	$	24,853,190	$	25,351,423	$	24,847,097	$	26,181,938

Schedule of Held to Maturity Securities

The amortized cost and fair value of investments in held-to-maturity fixed-maturity securities as of September 30, 2013 and December 31, 2012 are summarized as follows:

	September 30, 2013
												Net
	Cost or		Gross		Gross Unrealized Losses							Unrealized
	Amortized		Unrealized		Less than 12			More than 12		Fair		Gains/
Category	Cost		Gains		Months			Months		Value		(Losses)
	(unaudited)
U.S. Treasury securities	$	606,310	$	69,719	$	-		$	-	$	676,029	$	69,719
Political subdivisions of States,
Territories and Possessions		207,665		-		(2,935	)		-		204,730		(2,935)
Corporate and other bonds
Industrial and miscellaneous		634,823		8,934		-			-		643,757		8,934
Total	$	1,448,798	$	78,653	$	(2,935	)	$	-	$	1,524,516	$	75,718

	December 31, 2012
						Net
	Cost or	Gross	Gross Unrealized Losses			Unrealized
	Amortized	Unrealized	Less than 12	More than 12	Fair	Gains/
Category	Cost	Gains	Months	Months	Value	(Losses)
U.S. Treasury securities	$        606,281	$         172,745	$                     -	$                     -	$      779,026	$         172,745

U.S. Treasury securities included in held-to-maturity securities are held in trust pursuant to the New York State Department of Financial Services’ minimum funds requirement.

A summary of the amortized cost and fair value of the Company’s investments in held-to-maturity securities by contractual maturity as of September 30, 2013 and December 31, 2012 is shown below:

	September 30, 2013				December 31, 2012
	Amortized				Amortized
Remaining Time to Maturity	Cost		Fair Value		Cost		Fair Value
	(unaudited)
Less than one year	$	-	$	-	$	-	$	-
One to five years		-		-		-		-
Five to ten years		842,488		848,487		-		-
More than 10 years		606,310		676,029		606,281		779,026
Total	$	1,448,798	$	1,524,516	$	606,281	$	779,026

Schedule of Investment Income

Major categories of the Company’s net investment income are summarized as follows:

	Three months ended					Nine months ended
	September 30,					September 30,
	2013			2012		2013		2012
	(unaudited)					(unaudited)
Income:
Fixed-maturity securities	$	241,286		$	249,315	$	736,298	$	710,585
Equity securities		117,916			49,279		297,760		197,518
Cash and cash equivalents		1			25		30		84
Other		(1,066	)		2		10,751		6
Total		358,137			298,621		1,044,839		908,193
Expenses:
Investment expenses		63,789			56,462		192,173		168,638
Net investment income	$	294,348		$	242,159	$	852,666	$	739,555

Schedule of Securities with realized gains and losses on investments

The Company’s net realized gains and losses on investments are summarized as follows:

	Three months ended						Nine months ended
	September 30,						September 30,
	2013			2012			2013			2012
	(unaudited)						(unaudited)
Fixed-maturity securities:
Gross realized gains	$	56,669		$	60,349		$	237,886		$	153,695
Gross realized losses		-			-			(56,471	)		(52,600	)
		56,669			60,349			181,415			101,095
Equity securities:
Gross realized gains		79,593			7,735			369,582			40,019
Gross realized losses		(41,806	)		(2,098	)		(101,523	)		(29,568	)
		37,787			5,637			268,059			10,451
Net realized gains	$	94,456		$	65,986		$	449,474		$	111,546

Schedule of Securities with Unrealized Losses

The Company held securities with unrealized losses representing declines that were considered temporary at September 30, 2013 and December 31, 2012 as follows:

	September 30, 2013
	Less than 12 months							12 months or more							Total
						No. of							No. of		Aggregate
	Fair		Unrealized			Positions		Fair		Unrealized			Positions		Fair		Unrealized
Category	Value		Losses			Held		Value		Losses			Held		Value		Losses
	(unaudited)
Fixed-Maturity Securities:
U.S. Treasury securities
and obligations of U.S.
government corporations
and agencies	$	-	$	-			-	$	-	$	-			-	$	-	$	-
Political subdivisions of
States, Territories and
Possessions		1,372,233		(73,124	)		5		36,263		(3,833	)		1		1,408,496		(76,957	)
Corporate and other
bonds industrial and
miscellaneous		4,771,560		(207,697	)		17		302,423		(2,309	)		1		5,073,983		(210,006	)
Total fixed-maturity
securities	$	6,143,793	$	(280,821	)		22	$	338,686	$	(6,142	)		2	$	6,482,479	$	(286,963	)
Equity Securities:
Preferred stocks	$	2,345,104	$	(263,351	)		10	$	-	$	-			-	$	2,345,104	$	(263,351	)
Common stocks		1,503,495		(86,356	)		8		-		-			-		1,503,495		(86,356	)
Total equity securities	$	3,848,599	$	(349,707	)		18	$	-	$	-			-	$	3,848,599	$	(349,707	)
Total	$	9,992,392	$	(630,528	)		40	$	338,686	$	(6,142	)		2	$	10,331,078	$	(636,670	)

	December 31, 2012
	Less than 12 months							12 months or more							Total
						No. of							No. of		Aggregate
	Fair		Unrealized			Positions		Fair		Unrealized			Positions		Fair		Unrealized
Category	Value		Losses			Held		Value		Losses			Held		Value		Losses
Fixed-Maturity Securities:
Political subdivisions of
States, Territories and
Possessions	$	202,798	$	(1,574	)		1	$	-	$	-			-	$	202,798	$	(1,574	)
Corporate and other
bonds industrial and
miscellaneous		4,025,551		(43,553	)		19		128,125		(722	)		1		4,153,676		(44,275	)
Total fixed-maturity
securities	$	4,228,349	$	(45,127	)		20	$	128,125	$	(722	)		1	$	4,356,474	$	(45,849	)
Equity Securities:
Preferred stocks	$	387,925	$	(11,130	)		3	$	-	$	-			-	$	387,925	$	(11,130	)
Common stocks		1,536,860		(145,899	)		9		-		-			-		1,536,860		(145,899	)
Total equity securities	$	1,924,785	$	(157,029	)		12	$	-	$	-			-	$	1,924,785	$	(157,029	)
Total	$	6,153,134	$	(202,156	)		32	$	128,125	$	(722	)		1	$	6,281,259	$	(202,878	)