Note 2. Investments

See Note 1 in our 2014 Form 10-K for information regarding our accounting policy relating to available-for-sale (“AFS”) securities, which also includes additional disclosures regarding our fair value measurements.

The cost or amortized cost and estimated fair value of investments classified as available-for-sale as of June 30, 2015 and December 31, 2014 are as follows:

	Cost or		Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gains		Losses		Fair Value
June 30, 2015:
Fixed maturities:
U.S. government obligations	$	3,682,528	$	42,073	$	59,909	$	3,664,692
States and political subdivisions -- general obligations		393,070		-		8,809		384,261
States and political subdivisions -- special revenue		647,341		1,834		19,020		630,155
Corporate		15,929,095		1,425		851,242		15,079,278
Total fixed maturities		20,652,034		45,332		938,980		19,758,386
December 31, 2014:
Fixed maturities:
U.S. government obligations	$	3,670,531	$	124,573	$	22,350	$	3,772,754
States and political subdivisions -- general obligations		1,054,400		4,971		30,363		1,029,008
States and political subdivisions -- special revenue		1,254,184		2,699		35,033		1,221,850
Corporate		13,310,436		2,071		381,929		12,930,578
Total fixed maturities		19,289,551		134,314		469,675		18,954,190
Equity securities:
Preferred corporate stock		75,000		-		-		75,000
Total equity securities		75,000		-		-		75,000
Total	$	19,364,551	$	134,314	$	469,675	$	19,029,190

The Company has three securities that individually exceed 10% of the total of the state and political subdivisions categories as of June 30, 2015. The amortized cost, fair value, credit ratings, and description of the security is as follows:

Amortized

Estimated

Cost

Fair Value

Credit Rating

June 30, 2015:

Fixed maturities:

States and political subdivisions -- general obligations

Maricopa County Arizona School District No. 31

337,675

331,043

AA-

States and political subdivisions -- special revenue

South Dakota EDL Enhancement Fdg Corp

173,267

171,051

A-

Jefferson Cnty Co Sch Dist

168,670

160,124

Total

679,612

662,218

Credit Rating Source: Fidelity Brokerage Services LLC

The following table summarizes, for all securities in an unrealized loss position at June 30, 2015 and December 31, 2014, the estimated fair value, pre-tax gross unrealized loss and number of securities by length of time that those securities have been continuously in an unrealized loss position.

	June 30, 2015						December 31, 2014
			Gross		Number				Gross		Number
	Estimated		Unrealized		of		Estimated		Unrealized		of
	Fair Value		Loss		Securities		Fair Value		Loss		Securities
Fixed Maturities:
Less than 12 months:
U.S. government obligations	$	1,786,016	$	55,643		11	$	107,273	$	3,963		1
States and political subdivisions --
special revenue		240,904		3,962		3		-		-		-
Corporate		11,746,837		708,486		81		8,253,570		261,055		47
Greater than 12 months:
U.S. government obligations		199,157		4,266		2		1,096,399		18,387		8
States and political subdivisions --
general obligations		384,261		8,809		2		709,176		30,363		4
States and political subdivisions --
special revenue		283,467		15,058		3		1,052,184		35,033		9
Corporate		3,160,773		142,756		21		3,874,046		120,874		31
Total securities	$	17,801,415	$	938,980		123	$	15,092,648	$	469,675		100

Based on our review of the securities in an unrealized loss position at June 30, 2015 and December 31, 2014, no other-than-temporary impairments were deemed necessary. Management believes that the Company will fully recover its cost basis in the securities held at June 30, 2015, and management does not have the intent to sell nor is it more likely than not that the Company will be required to sell such securities until they recover or mature. The temporary impairments shown herein are primarily the result of the current interest rate environment rather than credit factors that would imply other-than-temporary impairment.

The amortized cost and estimated fair value of fixed maturities at June 30, 2015, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized		Estimated
	Cost		Fair Value
Due in one year or less	$	207,573	$	209,557
Due after one year through five years		2,401,201		2,428,766
Due after five years through ten years		9,975,868		9,514,184
Due after ten years		8,067,392		7,605,879
	$	20,652,034	$	19,758,386

The Company is required to hold assets on deposit for the benefit of policyholders in accordance with statutory rules and regulations. At June 30, 2015 and December 31, 2014, these required deposits had a total amortized cost of $5,068,416 and $3,824,485 and fair values of $4,996,789 and $3,918,911, respectively.

The components of net investment income for the three and six months ended June 30, 2015 and 2014 are as follows:

	Three months ended June 30,						Six months ended June 30,
	2015			2014			2015			2014
Fixed maturities	$	161,652		$	102,218		$	320,615		$	161,187
Equity securities		162			-			186			-
Cash and short-term investments		1			321			2			1,703
Gain (loss) from equity method investments		(55,711	)		(111,861	)		(16,650	)		(226,407	)
Other		15,799			23,852			30,416			34,728
		121,903			14,530			334,569			(28,789	)
Less investment expenses		(21,782	)		(17,572	)		(38,824	)		(28,303	)
	$	100,121		$	(3,042	)	$	295,745		$	(57,092	)

Proceeds for the three months ended June 30, 2015 and 2014 from sales of investments classified as available-for-sale were $2,840,976 and $3,670,232, respectively. Gross gains of $14,613 and $19,354 and gross losses of $89,156 and $3,081 were realized on those sales during the three months ended June 30, 2015 and 2014, respectively. Proceeds for the six months ended June 30, 2015 and 2014 from sales of investments classified as available-for-sale were $7,166,021 and $5,561,141, respectively. Gross gains of $118,401 and $21,640 and gross losses of $114,696 and $27,301 were realized on those sales during the six months ended June 30, 2015 and 2014, respectively.

As of June 30, 2015, all mortgage loans were sold. The following table summarizes the activity in the mortgage loans on real estate, held for investment account for the periods ended June 30, 2015 and December 31, 2014.

	Six months ended			Year ended
	June 30, 2015			December 31, 2014
Balance at beginning of period	$	349,386		$	665,569
Proceeds from payments on mortgage loans on real estate, held for investment		-			(3,931	)
Proceeds from settlement on mortgage loans on real estate, held for investment		(349,386	)		(312,252	)
Balance at end of period	$	-		$	349,386