10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2013

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to ____________

Commission File No. 0-16867

	UTG, INC.
	(Exact name of registrant as specified in its charter)
Delaware		20-2907892
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)
	5250 SOUTH SIXTH STREET
	P.O. BOX 5147
	SPRINGFIELD, IL  62705
	(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (217) 241-6300

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x  No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a small reporting company.  See definitions of "large accelerated filer", "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting companyx

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No x

The number of shares outstanding of the registrant's common stock as of July 23, 2013, was 3,789,390.

UTG, Inc.

(The "Company")

TABLE OF CONTENTS

PART I.   Financial Information		3
	Item 1.  Financial Statements	3
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Operations	4
	Condensed Consolidated Statements of Comprehensive Income	5
	Condensed Consolidated Statements of Cash Flows	6
	Notes to Condensed Consolidated Financial Statements	7
	Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations	18
	Item 4.  Controls and Procedures	23
	PART II.  Other Information	23
	Item 1.  Legal Proceedings	23
	Item 1A. Risk Factors	23
	Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds	23
	Item 3.  Defaults Upon Senior Securities	23
	Item 4.  Mine Safety Disclosures	23
	Item 5.  Other Information	23
	Item 6.  Exhibits	23
	Signatures	24
	Exhibit Index	25

Part 1.   Financial Information.

Item 1.  Financial Statements.

Condensed Consolidated Balance Sheets

	June 30,		December 31,
	2013			2012*
Investments:
Investments available for sale:
Fixed maturities, at fair value (amortized cost $168,770,852 and $173,526,717)	$	174,183,839	$	187,327,285
Equity securities, at fair value (cost $38,010,235 and $29,497,001)		38,891,173		30,504,914
Trading securities, at fair value (cost $5,962,028 and $14,714,333)		5,786,943		14,018,460
Mortgage loans on real estate at amortized cost		10,103,247		17,671,554
Discounted mortgage loans on real estate at cost		25,043,446		26,336,953
Investment real estate		77,974,348		68,165,013
Policy loans		12,059,168		12,591,572
Short-term investments		0		6,268,320
Total investments		344,042,164		362,884,071
Cash and cash equivalents		22,282,466		23,321,246
Accrued investment income		2,306,156		2,444,790
Reinsurance receivables:
Future policy benefits		28,782,686		29,318,018
Policy claims and other benefits		3,955,649		4,492,430
Cost of insurance acquired		11,168,589		11,700,765
Deferred policy acquisition costs		398,002		426,218
Property and equipment, net of accumulated depreciation		1,261,046		1,344,851
Income tax receivable		1,448,723		20,035
Other assets		6,310,920		5,381,969
Total assets	$	421,956,401	$	441,334,393
Liabilities:
Policy liabilities and accruals:
Future policyholder benefits	$	288,982,763	$	293,800,162
Policy claims and benefits payable		4,692,415		3,371,767
Other policyholder funds		420,884		477,948
Dividend and endowment accumulations		14,131,312		14,072,513
Income tax payable		7,782		2,042,786
Deferred income taxes		9,325,480		12,301,577
Notes payable		18,655,035		18,857,954
Trading securities, at fair value (proceeds $940,602 and $8,094,787)		869,761		7,552,704
Other liabilities		10,564,189		9,202,354
Total liabilities		347,649,621		361,679,765
Shareholders' equity:
Common stock - no par value, stated value $.001 per share.  Authorized 7,000,000 shares - 3,791,262 and 3,798,871 shares outstanding		3,791		3,799
Additional paid-in capital		44,234,126		44,337,743
Retained earnings		21,882,114		21,917,318
Accumulated other comprehensive income		4,112,664		9,664,466
Total UTG shareholders' equity		70,232,695		75,923,326
Noncontrolling interests		4,074,085		3,731,302
Total shareholders' equity		74,306,780		79,654,628
Total liabilities and shareholders' equity	$	421,956,401	$	441,334,393

* Balance sheet audited at December 31, 2012.

See accompanying notes.

Condensed Consolidated Statements of Income

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2013			2012			2013			2012
Revenue:
Premiums and policy fees	$	3,219,271		$	3,480,117		$	6,432,017		$	6,996,561
Ceded reinsurance premiums and policy fees		(769,335	)		(863,967	)		(1,545,037	)		(1,772,065	)
Net investment income		4,762,126			2,428,499			9,143,518			9,379,255
Other income		510,660			531,485			1,032,019			1,079,179
Revenues before realized gains		7,722,722			5,576,134			15,062,517			15,682,930
Realized investment gains, net:
Other-than-temporary impairments		0			0			(26,926	)		0
Other realized investment gains, net		576,841			3,846,725			648,490			10,982,695
Total realized investment gains, net		576,841			3,846,725			621,564			10,982,695
Total revenue		8,299,563			9,422,859			15,684,081			26,665,625
Benefits and other expenses:
Benefits, claims and settlement expenses:
Life		5,108,457			5,526,152			10,964,778			11,396,960
Ceded Reinsurance benefits and claims		(599,574	)		(1,192,533	)		(1,197,353	)		(2,028,408	)
Annuity		290,892			218,229			558,431			478,919
Dividends to policyholders		149,077			125,646			296,299			266,270
Commissions and amortization of deferred policy acquisition costs		(26,906	)		(131,671	)		(50,458	)		(284,484	)
Amortization of cost of insurance acquired		266,088			286,375			532,176			572,750
Operating expenses		1,975,001			2,410,634			4,030,126			5,286,129
Interest expense		144,101			82,523			254,538			154,698
Total benefits and other expenses		7,307,136			7,325,355			15,388,537			15,842,834
Income before income taxes		992,427			2,097,504			295,544			10,822,791
Income tax benefit (expense)		79,343			(503,685	)		12,035			(3,729,241	)
Net income		1,071,770			1,593,819			307,579			7,093,550
Net income attributable to noncontrolling interests		(196,702	)		(153,164	)		(342,783	)		(426,378	)
Net income (loss) attributable to common shareholders'	$	875,068		$	1,440,655		$	(35,204	)	$	6,667,172
Amounts attributable to common shareholders'
Basic income (loss) per share	$	0.23		$	0.38		$	(0.01	)	$	1.74
Diluted income (loss) per share	$	0.23		$	0.38		$	(0.01	)	$	1.74
Basic weighted average shares outstanding		3,792,203			3,814,403			3,794,317			3,825,802
Diluted weighted average shares outstanding		3,792,203			3,814,403			3,794,317			3,825,802

See accompanying notes.

Condensed Consolidated Statements of Comprehensive Income

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2013			2012			2013			2012
Net Income	$	1,071,770		$	1,593,819		$	307,579		$	7,093,550
Other comprehensive income (loss), net of tax:
Unrealized holding losses arising during period		(5,054,177	)		2,438,608			(5,077,927	)		(648,458	)
Less reclassification adjustment for (gains) losses included in net income		(414,509	)		(2,494,211	)		(473,875	)		(5,810,420	)
Subtotal:  Other comprehensive loss, net of tax		(5,468,686	)		(55,603	)		(5,551,802	)		(6,458,878	)
Comprehensive income (loss)		(4,396,916	)		1,538,216			(5,244,223	)		634,672
Less comprehensive loss attributable to noncontrolling interests		(196,702	)		(153,164	)		(342,783	)		(426,378	)
Comprehensive income (loss) attributable to UTG, Inc.	$	(4,593,618	)	$	1,385,052		$	(5,587,006	)	$	208,294

See accompanying notes.

Condensed Consolidated Statements of Cash Flows

	Six Months Ended
	June 30,			June 30,
	2013			2012
Cash flows from operating activities:
Net income (loss) attributable to common shareholders	$	(35,204	)	$	6,667,172
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Amortization (accretion) of investments		(1,462,254	)		(874,286	)
Realized investment gains, net		(621,564	)		(10,982,695	)
Unrealized trading gains (losses) included in income		(49,545	)		(167,251	)
Amortization of deferred policy acquisition costs		28,216			31,024
Amortization of cost of insurance acquired		532,176			572,750
Depreciation		640,571			638,394
Net income (loss) attributable to noncontrolling interest		342,783			426,378
Charges for mortality and administration of universal life and annuity products		(3,458,497	)		(3,541,227	)
Interest credited to account balances		2,662,628			2,551,509
Change in accrued investment income		138,634			(1,418,809	)
Change in reinsurance receivables		1,072,113			1,486,180
Change in policy liabilities and accruals		(2,642,960	)		(2,191,530	)
Change in income taxes receivable (payable)		(3,463,692	)		2,526,735
Change in other assets and liabilities, net		633,298			1,723
Net cash used in operating activities		(5,683,297	)		(4,273,933	)
Cash flows from investing activities:
Proceeds from investments sold and matured:
Fixed maturities available for sale		21,247,954			79,045,533
Equity securities available for sale		238,330			559,865
Trading securities		23,753,619			7,148,992
Mortgage loans		9,004,089			2,583,581
Discounted mortgage loans		3,898,888			3,156,105
Real estate		4,063,257			8,808,213
Policy loans		2,029,941			1,982,303
Total proceeds from investments sold and matured		64,236,078			103,284,592
Cost of investments acquired:
Fixed maturities available for sale		(16,132,719	)		(120,109,964	)
Equity securities available for sale		(8,731,875	)		(9,173,511	)
Trading securities		(22,140,303	)		(6,625,128	)
Mortgage loans		(1,435,782	)		(15,813,757	)
Discounted mortgage loans		(1,436,582	)		(6,040,124	)
Real estate		(7,829,033	)		(6,142,148	)
Policy loans		(1,497,536	)		(1,499,930	)
Short term		(25,000	)		0
Total cost of investments acquired		(59,228,830	)		(165,404,562	)
Sale of property and equipment		0			17,440
Net cash provided by (used in) investing activities		5,007,248			(62,102,530	)
Cash flows from financing activities:
Policyholder contract deposits		2,884,121			2,990,832
Policyholder contract withdrawals		(2,940,308	)		(3,364,427	)
Proceeds from notes payable/line of credit		0			1,281,000
Payments of principal on notes payable/line of credit		(202,919	)		(1,221,425	)
Purchase of treasury stock		(103,625	)		(571,380	)
Distributions to minority interests of consolidated subsidiaries		0			(14,000	)
Net cash used in financing activities		(362,731	)		(899,400	)
Net decrease in cash and cash equivalents		(1,038,780	)		(67,275,863	)
Cash and cash equivalents at beginning of period		23,321,246			82,925,675
Cash and cash equivalents at end of period	$	22,282,466		$	15,649,812

See accompanying notes.

UTG, Inc.

Notes to Condensed Consolidated Financial Statements

  Note 1 – Basis of Presentation

The accompanying condensed consolidated balance sheet as of December 31, 2012, which has been derived from audited financial statements, and the unaudited interim condensed consolidated financial statements include the accounts of UTG, Inc. (the "Parent") and its subsidiaries (collectively with the Parent, the "Company").  All significant intercompany accounts and transactions have been eliminated in consolidation.  The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 8 of regulation S-X.  Accordingly, they do not include all of the information and notes required by GAAP for audited annual financial statements.  The information furnished includes all adjustments and accruals of a normal recurring nature, which in the opinion of management, are necessary for a fair presentation of the results for the interim periods.  The unaudited condensed consolidated financial statements included herein and these related notes should be read in conjunction with the Company's consolidated financial statements, and the notes thereto, included in the Company's Annual Report on Form 10-K for the year ended December 31, 2012.  The Company's results of operations for the six month period ended June 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 31, 2013 or for any other future period.

This document at times will refer to the Registrant's largest shareholder, Mr. Jesse T. Correll and certain companies controlled by Mr. Correll.  Mr. Correll holds a majority ownership of First Southern Funding LLC ("FSF"), a Kentucky corporation, and First Southern Bancorp, Inc. ("FSBI"), a financial services holding company.  FSBI operates through its 100 % owned subsidiary bank, First Southern National Bank ("FSNB").  Banking activities are conducted through multiple locations within south-central and western Kentucky.  Mr. Correll is Chief Executive Officer and Chairman of the Board of Directors of UTG and is currently UTG's largest shareholder through his ownership control of FSF, FSBI and affiliates.  At June 30, 2013, Mr. Correll owns or controls directly and indirectly approximately 56 % of UTG's outstanding stock.

UTG's life insurance subsidiary, Universal Guaranty Life Insurance Company ("UG"), has several wholly-owned and majority-owned subsidiaries.  The subsidiaries were formed to hold certain real estate investments.  The real estate investments were placed into the limited liability companies and partnerships to provide additional protection to the policyholders and to UG.

Note 2 – New Accounting Standards

Comprehensive Income - In February 2013, the Financial Accounting Standards Board ("FASB") issued an accounting standard which requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. This guidance is effective for periods beginning after December 15, 2012. The adoption of this new guidance did not have a material impact on the Company's consolidated financial statements.

Intangibles-Goodwill and Other – In July 2012, FASB issued guidance on the testing of indefinite-lived intangible assets for impairment, which is intended to reduce the cost and complexity of the impairment test for indefinite-lived intangible assets by providing an entity with the option to first assess qualitatively whether it is necessary to perform the impairment test that is currently in place. An entity would not be required to quantitatively calculate the fair value of an indefinite-lived intangible asset unless the entity determines that it is more likely than not that its fair value is less than its carrying value. This guidance is effective for interim and annual impairment tests beginning after September 15, 2012, with early adoption permitted. The adoption of this new guidance did not have a material impact on the Company's consolidated financial statements.

Note 3 – Investments

Available for Sale Securities – Fixed Maturity and Equity Securities

The Company's insurance subsidiary is regulated by insurance statutes and regulations as to the type of investments they are permitted to make, and the amount of funds that may be used for any one type of investment.

Investments in available for sale securities are summarized as follows:

June 30, 2013	Original or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Investments available for sale:
Fixed maturities
U.S. Government and govt. agencies and authorities	$	33,659,574	$	3,762,559	$	(104,398	)	$	37,317,735
States, municipalities and political subdivisions		140,000		1,674		0			141,674
U.S. special revenue and assessments		2,151,464		120,169		0			2,271,633
Collateralized mortgage obligations		1,580,787		127,752		0			1,708,539
Public utilities		399,906		51,013		0			450,919
All other corporate bonds		130,839,121		4,458,128		(3,003,910	)		132,293,339
		168,770,852		8,521,295		(3,108,308	)		174,183,839
Equity securities		38,010,235		1,693,133		(812,195	)		38,891,173
Total	$	206,781,087	$	10,214,428	$	(3,920,503	)	$	213,075,012

December 31, 2012	Original or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Investments available for sale:
Fixed maturities
U.S. Government and govt. agencies and authorities	$	33,430,165	$	5,457,009	$	0		$	38,887,174
States, municipalities and political subdivisions		160,000		6,637		0			166,637
U.S. special revenue and assessments		2,150,070		153,545		0			2,303,615
Collateralized mortgage obligations		2,241,384		183,409		(8	)		2,424,785
Public utilities		399,900		63,662		0			463,562
All other corporate bonds		135,145,198		9,747,565		(1,811,251	)		143,081,512
		173,526,717		15,611,827		(1,811,259	)		187,327,285
Equity securities		29,497,001		1,303,328		(295,415	)		30,504,914
Total	$	203,023,718	$	16,915,155	$	(2,106,674	)	$	217,832,199

The amortized cost and estimated market value of debt securities at June 30, 2013, by contractual maturity, is shown below.  Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Fixed Maturities Available for Sale June 30, 2013	Amortized Cost		Estimated Fair Value
Due in one year or less	$	947,312	$	966,456
Due after one year through five years		20,606,308		22,025,918
Due after five years through ten years		112,832,650		116,653,174
Due after ten years		32,628,844		32,651,711
Collateralized mortgage obligations		1,755,738		1,886,580
Total	$	168,770,852	$	174,183,839

The fair value of investments with sustained gross unrealized losses at June 30, 2013 and December 31, 2012 are as follows:

June 30, 2013	Less than 12 months					12 months or longer					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
U.S. Government and govt. agencies and authorities	$	4,891,795		(104,398	)	$	0		0		$	4,891,795		(104,398	)
All other corporate bonds		44,750,024		(1,026,652	)		4,130,719		(1,977,258	)		48,880,743		(3,003,910	)
Total fixed maturities	$	49,641,819		(1,131,050	)	$	4,130,719		(1,977,258	)	$	53,772,538		(3,108,308	)
Equity securities	$	1,243,333		(812,195	)	$	0		0		$	1,243,333		(812,195	)

December 31, 2012	Less than 12 months					12 months or longer					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Collateralized mortgage obligations	$	4,513		(8	)	$	0		0		$	4,513		(8	)
All other corporate bonds		13,776,705		(245,846	)		385,823		(1,565,405	)		14,162,528		(1,811,251	)
Total fixed maturities	$	13,781,218		(245,854	)	$	385,823		(1,565,405	)	$	14,167,041		(1,811,259	)
Equity securities	$	594,081		(295,415	)	$	0		0		$	594,081		(295,415	)

Additional information regarding investments in an unrealized loss position is as follows:

	Less than 12 months	12 months or longer	Total
As of June 30, 2013
Fixed maturities	32	4	36
Equity securities	6	0	6
As of December 31, 2012
Fixed maturities	8	3	11
Equity securities	9	0	9

Substantially all of the unrealized losses on fixed maturities available for sale at June 30, 2013 and December 31, 2012 are attributable to changes in market interest rates and general disruptions in the credit market subsequent to purchase.  The unrealized losses on equity investments were primarily attributable to normal market fluctuations.  The Company does not currently intend to sell nor does it expect to be required to sell any of the securities in an unrealized loss position.  Based upon the Company's expected continuation of receipt of contractually required principal and interest payments and its intent and ability to retain the securities until price recovery, as well as the Company's evaluation of other relevant factors, the Company deems these securities to be temporarily impaired as of June 30, 2013 and December 31, 2012.

The Company regularly reviews its investment securities for factors that may indicate that a decline in fair value of an investment is other than temporary.  The factors considered by management in its regular review to identify and recognize other-than-temporary impairment losses on fixed maturities include, but are not limited to: the length of time and extent to which the fair value has been less than cost; the Company's intent to sell, or be required to sell, the debt security before the anticipated recovery of its remaining amortized cost basis; the financial condition and near-term prospects of the issuer; adverse changes in ratings announced by one or more rating agencies; subordinated credit support, whether the issuer of a debt security has remained current on principal and interest payments; current expected cash flows; whether the decline in fair value appears to be issuer specific or, alternatively, a reflection of general market or industry conditions, including the effect of changes in market interest rates.  If the Company intends to sell a debt security, or it is more likely than not that it would be required to sell a debt security before the recovery of its amortized cost basis, the entire difference between the security's amortized cost basis and its fair value at the balance sheet date would be recognized by a charge to other-than-temporary losses in the Condensed Consolidated Statements of Operations.

Equity securities may experience other-than-temporary impairments in the future based on the prospects for full recovery in value in a reasonable period of time and the Company's ability and intent to hold the security to recovery.  If a decline in fair value is judged by management to be other-than-temporary or management does not have the intent or ability to hold a security, a loss is recognized by a charge to other-than-temporary impairment losses in the Condensed Consolidated Statements of Operations.

Based on management's review of the investment portfolio, the Company recorded the following losses for other-than-temporary impairments in the Condensed Consolidated Statements of Operations:

	Three Months Ended
	June 30,
	2013		2012
Other than temporary impairments:
Real Estate	$	0	$	0

	Six Months Ended
	June 30,
	2013		2012
Other than temporary impairments:
Real Estate	$	26,926	$	0

The other-than-temporary impairments recognized during 2013 were due to Management's assessment of the value of the real estate. The real estate was written down to better reflect current expected market value.

Trading Securities

Securities designated as trading securities are reported at fair value, with gains or losses resulting from changes in fair value recognized in net investment income on the Condensed Consolidated Statements of Operations.  Trading securities include exchange-traded equities and exchange-traded options.  Trading securities carried as liabilities are securities sold short. A gain, limited to the price at which the security was sold short, or a loss, potentially unlimited in size, will be recognized upon the termination of the short sale.  The fair value of derivatives included in trading security assets and trading security liabilities as of June 30, 2013 was $230,369 and $(869,762), respectively. The fair value of derivatives included in trading security assets and trading security liabilities as of December 31, 2012 was $6,745,528 and $(6,050,344), respectively.  Earnings from trading securities are classified in cash flows from operating activities. The derivatives held by the Company are for income generation purposes only.

Trading revenue charged to net investment income from trading securities was:

	Three Months Ended
	June 30,
	2013		2012
Net unrealized gains (losses)	$	346,889	$	(361,447	)
Net realized gains (losses)		129,591		(611,749	)
Net unrealized and realized gains (losses)	$	476,480	$	(973,196	)

	Six Months Ended
	June 30,
	2013		2012
Net unrealized gains (losses)	$	49,545	$	167,251
Net realized gains (losses)		215,862		1,698,758
Net unrealized and realized gains (losses)	$	265,407	$	1,866,009

Mortgage Loans

As of June 30, 2013 and December 31, 2012, the Company's mortgage loan portfolio contained 51 and 71 mortgage loans, including discounted mortgage loans, with a carrying value of $35,146,693 and $44,008,507, respectively.

Changes in the current economy could have a negative impact on the loans, including the financial stability of the borrowers, the borrowers' ability to pay or to refinance, the value of the property held as collateral and the ability to find purchasers at favorable prices.  Given the uncertainty of the current market, management has taken a conservative approach with the discounted mortgage loans and has classified all discounted mortgage loans held as non-accrual.  In such status, the Company is not recording any accrued interest income nor is it recording any accrual of discount on the loans held.  Discount accruals reported during 2012 and 2013 were the result of the loan basis already being fully paid.

On the remainder of the mortgage loan portfolio, interest accruals are analyzed based on the likelihood of repayment.  In no event will interest continue to accrue when accrued interest along with the outstanding principal exceeds the net realizable value of the property.  The Company does not utilize a specified number of days delinquent to cause an automatic non-accrual status.

A mortgage loan reserve is established and adjusted based on management's quarterly analysis of the portfolio and any deterioration in value of the underlying property which would reduce the net realizable value of the property below its current carrying value.  The Company acquires the discounted mortgage loans at below contract value, and believes that it will fully recover its carrying value upon disposal, therefore no reserve for delinquent loans is deemed necessary.  Those loans not currently paying are being vigorously worked by management.  The current discounted commercial mortgage loan portfolio has an average price of37.3 % of face value and management has determined that this deep discount provides a financial cushion or built in allowance for any of the loans that are not currently performing within the portfolio of loans purchased.

Note 4 – Fair Value Measurements

The Company measures its assets and liabilities recorded at fair value in the Condensed Consolidated Balance Sheets based on the framework set forth in the GAAP fair value accounting guidance.  The framework establishes a fair value hierarchy of three levels based upon the transparency of information used in measuring the fair value of assets or liabilities as of the measurement date.  The fair value hierarchy prioritizes the inputs in the valuation techniques used to measure fair value into three categories.

Level 1 – Valuation is based upon quoted prices for identical assets or liabilities in active markets that the Company is able to access.  Level 1 fair value is not subject to valuation adjustments.

Level 2 – Valuation is based upon quoted prices for similar assets and liabilities in active markets or quoted prices for identical or similar instruments in markets that are not active. In addition, the Company may use various valuation techniques or pricing models that use observable inputs to measure fair value.

Level 3 – Valuation is based upon unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Unobservable inputs reflect the Company's own assumptions about the inputs that market participants would use in pricing the asset or liability.

The Company determines the existence of an active market for an asset or liability based on its judgment as to whether transactions for the asset or liability occur in such market with sufficient frequency and volume to provide reliable pricing information.  If the Company concludes that there has been a significant decrease in the volume and level of activity for an investment in relation to normal market activity for such investment, adjustments to transactions and quoted prices are made to estimate fair value.

The inputs used in the valuation techniques employed by the Company are provided by nationally recognized pricing services, external investment managers and internal resources.  To assess these inputs, the Company's review process includes, but is not limited to, quantitative analysis including benchmarking, initial and ongoing evaluations of methodologies used by external parties to calculate fair value, and ongoing evaluations of fair value estimates based on the Company's knowledge and monitoring of market conditions.

The Company periodically reviews the pricing service provider's policies and procedures for valuing securities.  The assumptions underlying the valuations from external service providers, including unobservable inputs, are generally not readily available as this information is often deemed proprietary.  Accordingly, the Company is unable to obtain comprehensive information regarding these assumptions and methodologies.

The Company's investments in fixed maturity securities available for sale, equity securities available for sale and trading securities assets and liabilities are carried at fair value.  The following are the Company's methodologies and valuation techniques for assets and liabilities measured at fair value.

Fixed maturities available for sale mainly consist of U.S. treasury securities and corporate debt securities. The Company employs a market approach to the valuation of securities where there are sufficient market transactions involving identical or comparable assets. If sufficient market data is not available for identical or comparable assets, the Company uses an income approach to valuation. The majority of the financial instruments included in fixed maturity securities available for sale are evaluated utilizing observable inputs; accordingly, they are categorized in either Level 1 or Level 2 of the fair value hierarchy. However, in instances where significant inputs utilized in valuation of the securities are unobservable, the securities are categorized in Level 3 of the fair value hierarchy.

Corporate securities primarily include fixed rate corporate bonds. Inputs utilized in connection with the Company's valuation techniques relating to this class of securities include recently executed transactions, market price quotations, benchmark yields and issuer spreads. Corporate securities are categorized in Level 2 of the fair value hierarchy.

U.S. treasury securities are based on quoted prices in active markets and are generally categorized in Level 1 of the fair value hierarchy.

Equity securities available for sale consist of common and preferred stocks mainly in private equity investments, financial institutions and insurance companies. Equity securities for which there is sufficient market data are categorized as Level 1 or 2 in the fair value hierarchy.  For the equity securities in which quoted market prices are not available, the transaction price is used as the best estimate of fair value at inception.  When evidence is believed to support a change to the carrying value from the transaction price, adjustments are made to reflect the expected exit values. The Company performs ongoing reviews of the underlying investments. The reviews consist of the evaluations of expected cash flows, material events and market data. These investments are included in Level 3 of the fair value hierarchy.

Securities designated as trading securities consist of bonds, exchange traded equities and exchange traded options.  These securities are primarily valued at quoted active market prices, and are therefore categorized as Level 1 in the fair value hierarchy.  The exchange traded bonds consist of corporate bonds and are classified as Level 2, consistent with the classification of the fixed maturity corporate bonds.

The following table presents the Company's assets and liabilities measured at fair value in the condensed consolidated balance sheet on a recurring basis as of June 30, 2013.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	20,405,327	$	153,446,375	$	332,137	$	174,183,839
Equity Securities, available for sale		1,600,776		7,350,216		29,940,181		38,891,173
Trading Securities		5,786,943		0		0		5,786,943
Total	$	27,793,046	$	160,796,591	$	30,272,318	$	218,861,955
Liabilities
Trading Securities	$	869,761	$	0	$	0	$	869,761

The following table presents the Company's assets and liabilities measured at fair value in the Condensed Consolidated Balance Sheet on a recurring basis as of December 31, 2012.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	20,993,398	$	166,060,160	$	273,727	$	187,327,285
Equity Securities, available for sale		1,448,585		6,092,614		22,963,715		30,504,914
Trading Securities		13,903,148		115,312		0		14,018,460
Total	$	36,345,131	$	172,268,086	$	23,237,442	$	231,850,659
Liabilities
Trading Securities	$	7,552,704	$	0	$	0	$	7,552,704

The following table provides reconciliations for Level 3 assets measured at fair value on a recurring basis. Transfers into and out of Level 3 are recognized as of the end of the quarter in which they occur.

	Fixed Maturities, Available for Sale		Equity Securities, Available for Sale			Total
Balance at December 31, 2012	$	273,727	$	22,963,715		$	23,237,442
Total unrealized gain or losses:
Included in other comprehensive income		58,410		(43,054	)		15,356
Purchases		0		7,019,520			7,019,520
Balance at June 30, 2013	$	332,137	$	29,940,181		$	30,272,318

The Level 3 securities include collateralized debt obligations of trust preferred securities issued by banks and insurance companies and certain equity securities with unobservable inputs.  None of the collateral is subprime or Alt-A mortgages (loans for which the typical documentation was not provided by the borrower).

Certain assets are not carried at fair value on a recurring basis, including investments such as mortgage loans and policy loans. Accordingly such investments are only included in the fair value hierarchy disclosure when the investment is subject to re-measurement at fair value after initial recognition and the resulting re-measurement is reflected in the condensed consolidated financial statements.

The carrying values and estimated fair values of certain of the Company's financial instruments not recorded at fair value in the condensed consolidated balance sheets are shown below. Because the fair value for all condensed consolidated balance sheet items are not required to be disclosed, the aggregate fair value amounts presented below are not reflective of the underlying value of the Company.

	June 30, 2013				December 31, 2012
Assets	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Mortgage loans on real estate	$	10,103,247	$	10,173,968	$	17,671,554	$	17,803,159
Discounted mortgage loans		25,043,446		25,043,446		26,336,953		26,336,953
Investment real estate		77,974,348		77,974,348		68,165,013		68,165,013
Policy loans		12,059,168		12,059,168		12,591,572		12,591,572
Cash and cash equivalents		22,282,466		22,282,466		23,321,246		23,321,246
Short term investments		0		0		6,268,320		6,268,320
Liabilities
Notes payable		18,655,035		18,655,035		18,857,954		18,857,954

The above estimated fair value amounts have been determined based upon the following valuation methodologies. Considerable judgment was required to interpret market data in order to develop these estimates. Accordingly, the estimates are not necessarily indicative of the amounts which could be realized in a current market exchange.  The use of different market assumptions or estimation methodologies may have a material effect on the fair value amounts.

The fair values of mortgage loans on real estate are estimated using discounted cash flow analyses and interest rates being offered for similar loans to borrowers with similar credit ratings.  The inputs used to measure the fair value of our mortgage loans on real estate are classified as Level 3 within the fair value hierarchy.

The Company has been purchasing non-performing discounted mortgage loans at a deep discount through an auction process led by the federal government.  In general, the discounted loans are non-performing and there is a significant amount of uncertainty surrounding the timing and amount of cash flows to be received by the Company.  Accordingly, the Company records its investment in the discounted loans at its original purchase price, which management believes approximates fair value.  The inputs used to measure the fair value of our discounted mortgage loans are classified as Level 3 within the fair value hierarchy.

Investment real estate is recorded at the lower of the net investment in the real estate or the fair value of the real estate less costs to sell.  The determination of fair value assessments are performed on a periodic, non-recurring basis by external appraisal and assessment of property values by management.  The inputs used to measure the fair value of our investment real estate are classified as Level 3 within the fair value hierarchy.

Policy loans are carried at the aggregate unpaid principal balances in the consolidated balance sheets which approximate fair value, and earn interest at rates ranging from 4 % to 8 %.  Individual policy liabilities in all cases equal or exceed outstanding policy loan balances.  The inputs used to measure the fair value of our policy loans are classified as Level 3 within the fair value hierarchy.

The carrying amount of cash and cash equivalents in the financial statements approximates fair value given the highly liquid nature of the instruments.  The inputs used to measure the fair value of our cash and cash equivalents are classified as Level 1 within the fair value hierarchy.

The carrying amount of short term investments in the financial statements approximates fair value.  The inputs used to measure the fair value of our short term investments are classified as Level 3 within the fair value hierarchy.

The carrying value is a reasonable estimate of fair value for notes payable subject to floating rates of interest.  The fair value of notes payable with fixed rate borrowings is determined based on the borrowing rates currently available to the Company for loans with similar terms and average maturities.  The inputs used to measure the fair value of our notes payable are classified as Level 2 within the fair value hierarchy.

Note 5 – Credit Arrangements

At June 30, 2013 and December 31, 2012, the Company had the following outstanding debt:

					Outstanding Principal Balance
Instrument	Issue Date		Maturity Date		June 30, 2013		December 31, 2012
Promissory Note:
HPG Acquisitions		2007-02-07		2017-11-07	$	0	$	202,919
HPG Acquisitions		2012-12-27		2018-03-04		12,000,000		12,000,000

Instrument	Issue Date		Maturity Date		Revolving Credit Limit		December 31, 2012		Borrowings		Repayments		June 30, 2013
Lines of Credit:
UTG		2012-11-20		2013-11-20	$	8,000,000	$	1,655,035		0		0	$	1,655,035
UTG Avalon		2011-12-28		2014-01-03		5,000,000		5,000,000		0		5,000,000		0
UTG Avalon		2013-03-28		2014-03-28		5,000,000		0		5,000,000		0		5,000,000
UG		2010-12-28		2013-12-06		15,000,000		0		0		0		0

The HPG Acquisitions promissory note issued on February 7, 2007 bears interest at a fixed rate of 5%. This promissory note was fully repaid during the second quarter of 2013.

The HPG Acquisitions promissory note issued on December 27, 2012 is secured by real estate owned by HPG. The promissory note bears interest at a fixed rate of 4%. Interest is payable monthly. Principal is payable monthly beginning in the third year of the note.

The UTG line of credit carries interest at a fixed rate of 3.75% and is payable monthly. As collateral, UTG has pledged 100% of the common voting stock of its wholly owned subsidiary, Universal Guaranty Life Insurance Company ("UG"). The UTG line of credit was fully repaid on July 5, 2013.

The UTG Avalon line of credit issued on December 28, 2011 carried interest at a rate of 4.0% and was payable in two semi-annual payments. This line of credit was repaid during March 2013.

The UTG Avalon line of credit issued on March 28, 2013 currently carries interest at a rate of 4.0% and is payable in two semi-annual payments. The interest rate is a variable rate that will be 0.50% above the lowest of the U.S. Prime Rates as published in the money section of the Wall Street Journal. The interest rate is subject to change monthly and changes in the interest rate will take effect on the first day of the month following the rate change.

UG is a member of the Federal Home Loan Bank ("FHLB").  This membership allows the Company access to additional credit up to a maximum of 50% of the total assets of UG.  To be a member of the FHLB, the Company was required to purchase shares of common stock of FHLB.  Borrowing capacity is based on 50 times each dollar of stock acquired in FHLB above the "base membership" amount.

The consolidated scheduled principal reductions on the notes payable for the next five years are as follows:

Year	Amount
2013	$	1,655,035
2014		5,000,000
2015		345,460
2016		478,193
2017		499,277

Note 6 – Shareholders' Equity

Stock Repurchase Programs

The Board of Directors of UTG authorized the repurchase in the open market or in privately negotiated transactions of up to $6 million of UTG's common stock. Repurchased shares are available for future issuance for general corporate purposes.  This program can be terminated at any time.  Open market purchases are made based on the last available market price and are generally limited to a maximum per share price of the most recent reported per share GAAP equity book value of the Company.  During the six month period ended June 30, 2013, the Company repurchased 7,609 shares through the stock repurchase program for $103,625.Through June 30, 2013, UTG has spent $4.7 million in the acquisition of 570,299 shares under this program.

Earnings Per Share Calculations

Earnings per share are based on the weighted average number of common shares outstanding during each period.  At June 30, 2013 and June 30, 2012, diluted earnings per share were the same as basic earnings per share since the Company had no dilutive instruments outstanding.

Note 7 – Commitments and Contingencies

The insurance industry has experienced a number of civil jury verdicts which have been returned against life and health insurers in the jurisdictions in which the Company does business involving the insurers' sales practices, alleged agent misconduct, failure to properly supervise agents, and other matters.  Some of the lawsuits have resulted in the award of substantial judgments against the insurer, including material amounts of punitive damages.  In some states, juries have substantial discretion in awarding punitive damages in these circumstances.  In the normal course of business, the Company is involved from time to time in various legal actions and other state and federal proceedings.  Management is of the opinion that the ultimate disposition of the matters will not have a materially adverse effect on the Company's results of operations or financial position.

Under the insurance guaranty fund laws in most states, insurance companies doing business in a participating state can be assessed up to prescribed limits for policyholder losses incurred by insolvent or failed insurance companies.  Although the Company cannot predict the amount of any future assessments, most insurance guaranty fund laws currently provide that an assessment may be excused or deferred if it would threaten an insurer's financial strength.  Mandatory assessments may be partially recovered through a reduction in future premium tax in some states. The Company does not believe such assessments will be materially different from amounts already provided for in the financial statements, though the Company has no control over such assessments.

As part of the Texas Imperial Life Insurance Company sale, the Company remains contingently liable for certain costs pending the outcome of an ongoing race-based audit on Texas Imperial Life Insurance Company by the Texas Department of Insurance.  Under the agreement, the Company is responsible for 100% of the first $50,000 of costs, 90% of the next $50,000, 75% of the third $50,000 and 50% of the costs above $150,000.  Management had conservatively estimated the Company's exposure and other costs at $50,000 based on information provided to date from the examination team and has established a contingent liability of $47,727 in its financial statements.  This contingency expires December 30, 2013.

Within the Company's trading accounts, certain trading securities carried as liabilities represent securities sold short.  A gain, limited to the price at which the security was sold short, or a loss, potentially unlimited in size, will be recognized upon the termination of the short sale.

On November 9, 2011, ACAP shareholders approved a proposed merger with UTG whereby ACAP shareholders received 233 shares of UTG for each share previously held of ACAP.  On November 14, 2011, the merger was completed.  Certain of the ACAP shareholders dissented to the merger requesting the courts determine the value of the ACAP shares.  The legal case is currently in the discovery phase.  The Company has established a contingent liability of $2,550,822 to cover the anticipated proceeds due to the dissenting shareholders and associated legal and other costs.

The following table represents the total funding commitments and the unfunded commitment as of June 30, 2013 related to certain investments:

	Total Funding		Unfunded
	Commitment		Commitment
RLF III, LLC	$	4,000,000	$	398,120
Llano Music, LLC		2,000,000		571,000
Marcellus III, LLP		1,250,000		281,875
Dew Learning, LLC		1,000,000		265,004
Marcellus HBPI, LLP		1,800,000		573,300
PBEX, LLC		5,625,000		2,818,750
Sovereign's Capital, LP		500,000		250,000

During 2006, the Company committed to invest in RLF III, LLC ("RLF"), which makes land-based investment in undervalued assets. RLF does capital calls as funds are needed for continued land purchases.

During 2010, the Company made a commitment to invest in Llano Music, LLC ("Llano), which invests in music royalties. Llano does capital calls to its investors as funds are needed to acquire the royalty rights.

During 2011, the Company committed to invest in Marcellus III, LLP, which purchases land for leasing opportunities to those looking to harvest natural resources. Marcellus III, LLC does capital calls to its investors as funds are needed for continued land purchases.

During 2012, the Company made a commitment to investment in Dew Learning, LLC ("Dew"), which is involved in the marketing and distribution of an electronic education based classroom model. Dew does capital calls to investors as funds are needed for continued development of the program.

During 2012, the Company committed to invest in Marcellus HBPI, LLP, which purchases land for leasing opportunities to those looking to harvest natural resources. Marcellus HPBI, LLC does capital calls to investors as funds are needed for continued land purchases.

During 2012, the Company committed to invest in PBEX, LLC, which purchases land for leasing opportunities to those looking to harvest natural resources. PBEX, LLC does capital calls to investors as funds are needed for continued land purchases.

During 2012, the Company committed to invest in Sovereign's Capital, LP ("Sovereign's"), which invests in companies in emerging markets. Sovereign's is expected to call the remaining unfunded commitment during 2013.

Note 8 – Other Cash Flow Disclosures

On a cash basis, the Company paid the following expenses:

	Three Months Ended
	June 30,
	2013		2012
Interest expense	$	15,643	$	134,399
Federal income tax		1,415,000		1,320,500

	Six Months Ended
	June 30,
	2013		2012
Interest expense	$	32,041	$	149,613
Federal income tax		3,465,000		1,343,081

During the first quarter of 2013, UG's wholly-owned subsidiary, UTG Avalon, LLC, entered into a noncash transaction whereby the subsidiary obtained a new line of credit in the amount of $5 million and utilized the line of credit to repay the prior line of credit. The terms of the new line of credit are consistent with the terms of the prior line of credit.

During the second quarter of 2013, UG and one of its subsidiaries, Cumberland Woodlands, LLC, entered into noncash transactions whereby short-term investments in the amount of $6.3 million were exchanged for real estate in the amount of $6.3 million.

Note 9 – Concentrations of Credit Risk

The Company maintains cash balances in financial institutions that at times may exceed federally insured limits.  The Company maintains its primary operating cash accounts with First Southern National Bank, an affiliate of the largest shareholder of UTG, Mr. Jesse Correll, the Company's CEO and Chairman.  The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents.

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations

The following is Management's discussion and analysis of the financial condition and results of operations of UTG, Inc. and its subsidiaries (collectively with the Parent, the "Company").  The following discussion of the financial condition and results of operations of the Company should be read in conjunction with, and is qualified in its entirety by reference to, the Consolidated Financial Statements of the Company and the related Notes thereto appearing in the Company's annual report on Form 10-K for the year ended December 31, 2012, as filed with the Securities and Exchange Commission, and our unaudited Condensed Consolidated Financial Statements and related Notes thereto appearing elsewhere in this quarterly report.

Cautionary Statement Regarding Forward-Looking Statements

This report on Form 10-Q contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which are intended to be covered by the safe harbors created by those laws. We have based our forward-looking statements on our current expectations and projections about future events. Our forward-looking statements include information about possible or assumed future results of operations. All statements, other than statements of historical facts, included or incorporated by reference in this report that address activities, events or developments that we expect or anticipate may occur in the future, including such things as the growth of our business and operations, our business strategy, competitive strengths, goals, plans, future capital expenditures and references to future successes may be considered forward-looking statements. Also, when we use words such as "anticipate," "believe," "estimate," "expect," "intend," "plan," "probably," or similar expressions, we are making forward-looking statements.

Numerous risks and uncertainties may impact the matters addressed by our forward-looking statements, any of which could negatively and materially affect our future financial results and performance.

Although we believe that the assumptions underlying our forward-looking statements are reasonable, any of these assumptions, and, therefore, the forward-looking statements based on these assumptions, could themselves prove to be inaccurate. In light of the significant uncertainties inherent in the forward-looking statements that are included in this report, our inclusion of this information is not a representation by us or any other person that our objectives and plans will be achieved. In light of these risks, uncertainties and assumptions, any forward-looking event discussed in this report may not occur.  Our forward-looking statements speak only as of the date made, and we undertake no obligation to update or review any forward-looking statement, whether as a result of new information, future events or other developments, unless the securities laws require us to do so.

Overview

UTG, Inc., a Delaware corporation, is a life insurance holding company.  The Company's dominant business is individual life insurance, which includes the servicing of existing insurance policies in force, the acquisition of other companies in the life insurance business and the administration and processing of life insurance business for other entities.  The Company's focus for the future includes growing the administrative portion of the business.

Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts and related disclosures. Actual results could differ significantly from those estimates.  The Company has identified certain estimates that involve a higher degree of judgment and are subject to a significant degree of variability.  The Company's critical accounting policies and the related estimates considered most significant by Management are disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2012.  Management has identified the accounting policies related to cost of insurance acquired, assumptions and judgments utilized in determining if declines in fair values of investments are other-than-temporary, and valuation methods for investments that are not actively traded as those, due to the judgments, estimates and assumptions inherent in those policies, are critical to an understanding of the Company's Condensed Consolidated Financial Statements and this Management's Discussion and Analysis.

During the six months ended June 30, 2013, there were no additions to or changes in the critical accounting policies disclosed in the 2012 Form 10-K, except for recently adopted accounting standards discussed in Note 2 of the Notes to the Condensed Consolidated Financial Statements.

Results of Operations

On a consolidated basis, the Company reported net income attributable to common shareholders' of $875,000 and $1.4 million for the second quarter of 2013 and 2012, respectively.  The Company reported a net loss attributable to common shareholders' of $(35,000) and net income attributable to common shareholders' of $6.7 million for the six month period ended June 30, 2013 and 2012, respectively.  During the first six months of 2012, the Company sold certain US Treasury debt securities, recognizing gains of approximately $8.5 million on the sales. The favorable earnings reported by the Company during the first six months of 2012 were mainly attributable to the gains recognized from the sale of the debt securities. The Company did not experience similar activity during the first six months of 2013, causing a variance in the earnings, when comparing 2012 and 2013 results.

During the second quarter of 2013 and 2012, the Company reported total revenues of $8.3 million and $9.4 million, respectively. Total revenues reported by the Company were $15.7 million during the six month period ended June 30, 2013 compared to $26.7 million during the six month period ended June 30, 2012.  The variance in total revenues, when comparing the three and six month periods ended June 30, 2013 and 2012 are also attributable to the 2012 realized investment gains.

The magnitude of realized investment gains and losses in a given year is a function of the timing of trades of investments relative to the markets themselves as well as the recognition of any impairments on investments.  One-time events, primarily reflected in realized gains, comprised a substantial portion of net income of the Company during 2012.  While Management believes there remain additional investments with such one-time earnings, when or if realized remains uncertain.

Total benefits and other expenses paid during the second quarter of 2013 and 2012 were $7.3 million.  Total benefits and other expenses paid during the six months ended June 30, 2013 and 2012 were $15.4 million and $15.8 million, respectively.

Revenues

The Company's premium and policy fee revenues, net of reinsurance, were approximately $2.4 million for the second quarter of 2013, a decrease of approximately 6% compared to the same quarter in 2012 and approximately $4.9 for the six month period ended June 30, 2013, a decrease of approximately 6% compared to the corresponding period ended in 2012. The Company writes very little new business.  Unless the Company acquires a new insurance company or a block of in-force business, Management expects premium revenue to continue to decline on the existing blocks of business at a rate consistent with prior experience.

The Company reported net investment income of approximately $4.8 million during the second quarter 2013 and approximately $9.1 million for the six month period ended June 30, 2013.  The Company reported net investment income of approximately $2.4 million during the second quarter 2012 and approximately $9.4 million for the six month period ended June 30, 2012. Net investment income for the six month period ended June 30, 2013 is comparable to the same period in 2012. However, net investment income for the second quarter 2013 is approximately 96% higher than for the same period in 2012.

The variance in 2013 and 2012 investment income results, when comparing the second quarter 2012 and 2013, are mainly attributable to activity in the trading securities portfolio, the fixed maturities portfolio and the discounted mortgage loan portfolio.

During the second quarter of 2013, the Company reported income of approximately $480,000 in the trading securities portfolio while during the second quarter 2012 the Company recorded a loss of approximately $(518,000) from the trading securities investment portfolio.  In March 2013, Management determined it had other investment opportunities to deploy a portion of the trading account monies into and reduced the funds to be used for trading activities going forward. Volatility as well as possible losses should be expected in the trading securities portfolio. Management's target return on the trading securities portfolio is 6% to 8%.

Income from fixed maturities increased approximately 12% or $201,000 when comparing the second quarter 2013 to the second quarter 2012 and by 32% or $954,000 when comparing the six month period ended June 30, 2013 and 2012. The increase in income from fixed maturities is attributable to the higher yield earned on the BBB and BB bonds the Company began investing in during 2012. In early 2012, the Company sold a significant portion of its US Treasury bonds, recognizing large gains. The proceeds from the sale of the US Treasury bonds were used to purchase BBB and BB rated bonds, which produce higher investment yields.

Income from the discounted mortgage loan portfolio increased approximately 21% or $454,000 when comparing the second quarter 2013 to the second quarter 2012 and by 27% or $615,000 when comparing the six month period ended June 30, 2013 and 2012. The increase in income from the discounted mortgage loan portfolio is mainly attributable to two discounted mortgage loans that were fully repaid during the second quarter 2013.

The Company reported net realized investment gains of approximately $577,000 and $3.8 million for the second quarter of 2013 and 2012, respectively and approximately $622,000 and $11 million for the six month period ended June 30, 2013 and 2012, respectively. The decrease in net realized gains in 2013, in comparison to 2012, is mainly attributable to the sale of fixed maturity investments during 2012.

During the first half of 2012, the Company took advantage of the unusually high price spreads on U.S. government treasury securities relative to other types of bonds in the marketplace, by selling certain U.S. treasury holdings.  The Company has redeployed a majority of its excess cash balances into BBB and BB rated corporate debt issues.  Included in fixed maturity purchases, the Company purchased approximately $66,509,000 and $22,325,000 of BBB and BB rated corporate debt issues, respectively.  These corporate debt issues have an average interest yield of 5.03%.Interest spreads on these investments are higher than historic trends and Management believes this is an opportunity to enhance yield and provide more recurring investment income.  Lower rated bonds are viewed by the marketplace to inherently hold more default risk.  The trade-off on this risk is a higher interest yield.  Each investment is analyzed prior to acquisition to determine if Management is comfortable with the increased risk relative to the yield.  Management believes there are opportunities currently available in this area where certain corporate bond issues have been more harshly impacted by the marketplace than may really be justified.  It is this type of bond Management is primarily searching for to invest in.

Other income primarily represented revenues received relating to the performance of administrative work as a TPA for unaffiliated life insurance companies, which has remained consistent over the periods presented.  The Company receives monthly fees based on policy in force counts and certain other activity indicators such as number of policies issued.  Management remains committed to the pursuit of additional TPA clients and believes this area continues to show potential for growth.

Expenses

Life benefits, claims and settlement expenses, net of reinsurance benefits and claims, increased approximately 5% in the six month period ended June 30, 2013 compared to the same period in 2012 and by 6% for the second quarter 2013 compared to the same quarter in 2012.  Policy claims vary from period to period and therefore, fluctuations in mortality are to be expected and are not considered unusual by Management.

Net amortization of cost of insurance acquired decreased approximately 7% in the six month period ended June 30, 2013 compared to the same period in 2012 and by 7% for the second quarter 2013, compared to the same quarter in 2012.  Cost of insurance acquired is established when an insurance company is acquired or when the Company acquires a block of in-force business.  The Company assigns a portion of its cost to the right to receive future profits from insurance contracts existing at the date of the acquisition.  Cost of insurance acquired is amortized with interest in relation to expected future profits, including direct charge-offs for any excess of the unamortized asset over the projected future profits. The interest rates may vary due to risk analysis performed at the time of acquisition on the business acquired.

The Company utilizes a 12% discount rate on the remaining unamortized business.  The amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised.  Amortization of cost of insurance acquired is particularly sensitive to changes in interest rate spreads and persistency of certain blocks of insurance in-force.  This expense is expected to decrease, unless the Company acquires a new block of business.

Operating expenses decreased approximately 24% in the six month period ended June 30, 2013 in comparison to the same period in 2012 and by approximately 18% for the second quarter 2013 in comparison to the same quarter in 2012.  The decrease in 2013 expenses, in comparison to 2012, is primarily attributable to a decrease in legal expenses and charitable contributions.

The Company's legal expenses decreased by approximately 95% when comparing the six month period ended June 30, 2013 to the same period in 2012 and decreased by approximately 85% when comparing the second quarter of 2013 to the second quarter of 2012.  During 2012, the Company's legal expenses were higher as a result of legal expenses incurred related to the merger of American Capitol and the ACAP dissenters' lawsuit.

The Company's charitable contributions decreased by approximately 91% when comparing the six month period ended June 30, 2013 to the same period in 2012 and by 75% when comparing the second quarter of 2013 to the second quarter of 2012. Charitable contributions made by the Company are tied to the earnings of the Company.

Management continues to place significant emphasis on expense monitoring and cost containment.  Maintaining administrative efficiencies directly impacts net income.

Interest expense increased by approximately 65% during the six months period ended June 30, 2013 compared to the same period in 2012 and increased by approximately 75% when comparing the second quarter 2013 to the same quarter in 2012. During the fourth quarter of 2012, a majority owned subsidiary of UG, HPG Acquisitions, LLC ("HPG") obtained a $12 million note. HPG borrowed money to return capital to its investors.

Financial Condition

Investment Information

Investments represent approximately 82% of total assets at June 30, 2013 and December 31, 2012, respectively.  Accordingly, investments are the largest asset group of the Company.  The Company's insurance subsidiary is regulated by insurance statutes and regulations as to the type of investments that it is permitted to make and the amount of funds that may be used for any one type of investment.  In light of these statutes and regulations, the majority of the Company's investment portfolio is invested in a diverse set of securities.

As of June 30, 2013, the carrying value of fixed maturity securities in default as to principal or interest was immaterial in the context of consolidated assets, shareholders' equity or results from operations.  To provide additional flexibility and liquidity, the Company has identified all fixed maturity securities as "investments held for sale".  Investments held for sale are carried at market, with changes in market value charged directly to shareholders' equity.

During the first quarter of 2013, the Company sold a substantial portion of its trading security assets and liabilities. The trading securities asset balance decreased by 59% or $8.2 million when comparing the June 30, 2013 balance to the December 31, 2012 balance.  The trading securities liability balance decreased by 88% or $6.7 million when comparing the June 30, 2013 balance to the December 31, 2012 balance.  The sale of the trading security assets and liabilities were the result of Management's decision to reduce the Company's investment risk and reduce the volatility in the investment earnings of the Company.  The proceeds from the sales of the trading securities will be used to purchase new investments that are deemed to be of less risk and which will provide more stable and predictable earnings for the Company.

Capital Resources

Total shareholders' equity decreased by approximately 7% as of June 30, 2013 compared to December 31, 2012. The decrease in shareholders' equity is mainly attributable to the change in accumulated other comprehensive income.  The change in accumulated other comprehensive income was mainly due to the overall increase in interest rates during the second quarter of 2013, which resulted in unrealized losses on fixed maturity investments available for sale.

At June 30, 2013, the Company had $18.7 million of debt outstanding.  At December 31, 2012, the Company had $18.9 million of debt outstanding.  Approximately $1.6 million of this debt is related to the acquisition of ACAP Corporation, which was fully repaid during the third quarter of 2013.  Approximately $12 million of this debt is related to credit facilities extended to a majority owned subsidiary of UTG, HPG Acquisitions, LLC ("HPG"), during 2012. HPG borrowed money to return capital to its investors.  UTG Avalon, LLC, a wholly owned subsidiary of UG, has an outstanding line of credit in the amount of $5 million.

Liquidity

The Company has three principal needs for cash - the insurance companies' contractual obligations to policyholders, the payment of operating expenses and debt service.  Cash and cash equivalents as a percentage of total assets were approximately 5% as of June 30, 2013 and December 31, 2012.  Fixed maturities as a percentage of total assets were approximately 41% and 42% as of June 30, 2013 and December 31, 2012, respectively.

The Company currently has access to funds for operating liquidity.  UTG has an $8 million revolving credit note with Illinois National Bank.  On April 6, 2011, UTG Avalon was extended a credit note from First National Bank of Tennessee for $5 million. The UTG Avalon line of credit was fully repaid during March 2013 and UTG Avalon obtained a new line of credit in the amount of $5 million from a different financing source.  UG is a member of the FHLB which allows UG access to credit.  UG's current line of credit with the FHLB is $15 million.  At June 30, 2013, the Company had approximately $6.6 million of outstanding borrowings attributable to the lines of credit.

Future policy benefits are primarily long-term in nature and therefore, the Company's investments are predominantly in long-term fixed maturity investments such as bonds and mortgage loans which provide sufficient return to cover these obligations.

Many of the Company's products contain surrender charges and other features which reward persistency and penalize the early withdrawal of funds.  With respect to such products, surrender charges are generally sufficient to cover the Company's unamortized deferred policy acquisition costs with respect to the policy being surrendered.

Net cash used in operating activities was approximately $5.7 million and $4.3 million for the six month period ended June 30, 2013 and 2012, respectively.

Net cash provided by (used in) investing activities was approximately $5 millionand $(62.1) million for the six month period ended June 30, 2013 and 2012, respectively.  During the first six months of 2012, more emphasis was placed on the sale of U.S. treasury holdings and re-deploying the cash through the purchase of BBB and BB rated corporate bonds.

Net cash used in financing activities was approximately $363,000 and $899,000 for the six month period ended June 30, 2013 and 2012, respectively.

UTG is a holding company that has no day-to-day operations of its own.  Funds required to meet its expenses, generally costs associated with maintaining the company in good standing with states in which it does business and the servicing of its debt, are primarily provided by its subsidiaries.  On a parent only basis, UTG's cash flow is dependent on management fees received from its insurance subsidiary, stockholder dividends from its subsidiary and earnings received on cash balances.  At June 30, 2013, substantially all of the consolidated shareholders equity represents net assets of its subsidiary.  The Company's insurance subsidiary has maintained adequate statutory capital and surplus.  The payment of cash dividends to shareholders by UTG is not legally restricted.  However, the state insurance department regulates insurance company dividend payments where the company is domiciled.  No dividends were paid to shareholders in 2012 or the first six months of 2013.

UG is an Ohio domiciled insurance company, which requires notification within five business days to the insurance commissioner following the declaration of any ordinary dividend and at least ten calendar days prior to payment of such dividend.  Ordinary dividends are defined as the greater of:  a) prior year statutory net income or b) 10% of statutory capital and surplus.  For the year ended December 31, 2012, UG had statutory net income of $6.9 million.  At December 31, 2012 UG's statutory capital and surplus amounted to $32.2 million.  Extraordinary dividends (amounts in excess of ordinary dividend limitations) require prior approval of the insurance commissioner and are not restricted to a specific calculation.  During the first six months of 2013, UG paid no ordinary dividends to UTG. During the third quarter 2013, UG paid UTG an ordinary dividend of $1.7 million. During 2012, UG paid UTG ordinary dividends of approximately $3.3 million. UTG used the dividends to pay off its line of credit.

Management believes the overall sources of liquidity available will be sufficient to satisfy the Company's financial obligations.

ITEM 4.  CONTROLS AND PROCEDURES

The Company maintains a set of disclosure controls and procedures designed to ensure that information required to be disclosed in reports that it files or submits under the Securities Exchange Act of 1934, as amended (the Exchange Act), is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms. In addition, the disclosure controls and procedures ensure that information required to be disclosed is accumulated and communicated to management, including the principal executive officer and principal financial officer, allowing timely decisions regarding required disclosure. Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Exchange Act. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this annual report.

PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

NONE

ITEM 1A.  RISK FACTORS

NONE

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

NONE

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

NONE

ITEM 4.  MINE SAFETY DISCLOSURES

NONE

ITEM 5.  OTHER INFORMATION

NONE

ITEM 6.  EXHIBITS

*10.22	Promissory Note dated March 28, 2013 between UTG Avalon, LLC and First Southern Funding
*31.1	Certification of Jesse T. Correll, Chief Executive Officer and Chairman of the Board of UTG, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*31.2	Certification of Theodore C. Miller, Chief Financial Officer, Senior Vice President and Corporate Secretary of UTG, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*32.1	Certificate of Jesse T. Correll, Chief Executive Officer and Chairman of the Board of UTG, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
*32.2	Certificate of Theodore C. Miller, Chief Financial Officer, Senior Vice President and Corporate Secretary of UTG, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
**101	Interactive Data File

*Filed herewith

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

UTG, INC.

(Registrant)

Date:	August 9, 2013	By	/s/ James P. Rousey
			James P. Rousey
			President and Director

Date:	August 9, 2013	By	/s/ Theodore C. Miller
			Theodore C. Miller
			Senior Vice President
			and Chief Financial Officer

EXHIBIT INDEX

Exhibit Number Description

*10.22	Promissory Note dated March 28, 2013 between UTG Avalon, LLC and First Southern Funding
*31.1	Certification of Jesse T. Correll, Chief Executive Officer and Chairman of the Board of UTG, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*31.2	Certification of Theodore C. Miller, Chief Financial Officer, Senior Vice President and Corporate Secretary of UTG, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*32.1	Certificate of Jesse T. Correll, Chief Executive Officer and Chairman of the Board of UTG, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
*32.2	Certificate of Theodore C. Miller, Chief Financial Officer, Senior Vice President and Corporate Secretary of UTG, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
**101	Interactive Data File

* Filed herewith

EX-31.1

Exhibit 31.1

CERTIFICATIONS
I, Jesse T. Correll, Chairman of the Board and Chief Executive Officer of UTG, Inc., certify that:
1.	I have reviewed this quarterly report on Form 10-Q of the registrant, UTG, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)and 15d-15(f)) for the registrant and have:
	a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c.	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d.	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
	a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.

Date:	August 9, 2013	By	/s/ Jesse T. Correll
			Chairman of the Board and
			Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS
I, Theodore C. Miller,  Senior Vice President, Corporate Secretary and Chief Financial Officer of UTG, Inc., certify that:
1.	I have reviewed this quarterly report on Form 10-Q of the registrant, UTG, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)and 15d-15(f)) for the registrant and have:
	a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c.	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d.	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
	a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.

Date:	August 9, 2013	By	/s/ Theodore C. Miller
			Senior Vice President, Corporate Secretary and
			Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of UTG, Inc. (the "Company") for the period ended June 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the "Report") I, Jesse T. Correll, Chairman of the Board and Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company

Date:	August 9, 2013	By:	/s/ Jesse T. Correll
			Jesse T. Correll
			Chairman of the Board and
			Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of UTG, Inc. (the "Company") for the period ended June 30, 2013 as filed with the Securities and Exchange Commission on the date hereof (the "Report") I, Theodore C. Miller, Senior Vice President, Corporate Secretary and Chief Financial Officer of the Company, certify pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company

Date:	August 9, 2013	By:	/s/ Theodore C. Miller
			Theodore C. Miller
			Senior Vice President, Corporate
			Secretary and Chief Financial Officer

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INVESTMENTS (Tables)

6 Months Ended

Jun. 30, 2013

INVESTMENTS [Abstract]

Amortized cost and estimated values of investments in securities including investments held for sale

Investments in available for sale securities are summarized as follows:

June 30, 2013	Original or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Investments available for sale:
Fixed maturities
U.S. Government and govt. agencies and authorities	$	33,659,574	$	3,762,559	$	(104,398	)	$	37,317,735
States, municipalities and political subdivisions		140,000		1,674		0			141,674
U.S. special revenue and assessments		2,151,464		120,169		0			2,271,633
Collateralized mortgage obligations		1,580,787		127,752		0			1,708,539
Public utilities		399,906		51,013		0			450,919
All other corporate bonds		130,839,121		4,458,128		(3,003,910	)		132,293,339
		168,770,852		8,521,295		(3,108,308	)		174,183,839
Equity securities		38,010,235		1,693,133		(812,195	)		38,891,173
Total	$	206,781,087	$	10,214,428	$	(3,920,503	)	$	213,075,012

December 31, 2012	Original or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Investments available for sale:
Fixed maturities
U.S. Government and govt. agencies and authorities	$	33,430,165	$	5,457,009	$	0		$	38,887,174
States, municipalities and political subdivisions		160,000		6,637		0			166,637
U.S. special revenue and assessments		2,150,070		153,545		0			2,303,615
Collateralized mortgage obligations		2,241,384		183,409		(8	)		2,424,785
Public utilities		399,900		63,662		0			463,562
All other corporate bonds		135,145,198		9,747,565		(1,811,251	)		143,081,512
		173,526,717		15,611,827		(1,811,259	)		187,327,285
Equity securities		29,497,001		1,303,328		(295,415	)		30,504,914
Total	$	203,023,718	$	16,915,155	$	(2,106,674	)	$	217,832,199

Amortized cost and estimated market value of debt securities, by contractual maturity

The amortized cost and estimated market value of debt securities at June 30, 2013, by contractual maturity, is shown below.  Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Fixed Maturities Available for Sale June 30, 2013	Amortized Cost		Estimated Fair Value
Due in one year or less	$	947,312	$	966,456
Due after one year through five years		20,606,308		22,025,918
Due after five years through ten years		112,832,650		116,653,174
Due after ten years		32,628,844		32,651,711
Collateralized mortgage obligations		1,755,738		1,886,580
Total	$	168,770,852	$	174,183,839

Fair value of investments with sustained gross unrealized losses

The fair value of investments with sustained gross unrealized losses at June 30, 2013 and December 31, 2012 are as follows:

June 30, 2013	Less than 12 months					12 months or longer					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
U.S. Government and govt. agencies and authorities	$	4,891,795		(104,398	)	$	0		0		$	4,891,795		(104,398	)
All other corporate bonds		44,750,024		(1,026,652	)		4,130,719		(1,977,258	)		48,880,743		(3,003,910	)
Total fixed maturities	$	49,641,819		(1,131,050	)	$	4,130,719		(1,977,258	)	$	53,772,538		(3,108,308	)
Equity securities	$	1,243,333		(812,195	)	$	0		0		$	1,243,333		(812,195	)

December 31, 2012	Less than 12 months					12 months or longer					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Collateralized mortgage obligations	$	4,513		(8	)	$	0		0		$	4,513		(8	)
All other corporate bonds		13,776,705		(245,846	)		385,823		(1,565,405	)		14,162,528		(1,811,251	)
Total fixed maturities	$	13,781,218		(245,854	)	$	385,823		(1,565,405	)	$	14,167,041		(1,811,259	)
Equity securities	$	594,081		(295,415	)	$	0		0		$	594,081		(295,415	)

Additional information regarding investments in an unrealized loss position is as follows:

	Less than 12 months	12 months or longer	Total
As of June 30, 2013
Fixed maturities	32	4	36
Equity securities	6	0	6
As of December 31, 2012
Fixed maturities	8	3	11
Equity securities	9	0	9

Other than temporary impairments

Based on management's review of the investment portfolio, the Company recorded the following losses for other-than-temporary impairments in the Condensed Consolidated Statements of Operations:

	Three Months Ended
	June 30,
	2013		2012
Other than temporary impairments:
Real Estate	$	0	$	0

	Six Months Ended
	June 30,
	2013		2012
Other than temporary impairments:
Real Estate	$	26,926	$	0

Trading revenue charged to investment

Trading revenue charged to net investment income from trading securities was:

	Three Months Ended
	June 30,
	2013		2012
Net unrealized gains (losses)	$	346,889	$	(361,447	)
Net realized gains (losses)		129,591		(611,749	)
Net unrealized and realized gains (losses)	$	476,480	$	(973,196	)

	Six Months Ended
	June 30,
	2013		2012
Net unrealized gains (losses)	$	49,545	$	167,251
Net realized gains (losses)		215,862		1,698,758
Net unrealized and realized gains (losses)	$	265,407	$	1,866,009

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Income Statement (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Revenues:
Premiums and policy fees	$ 3,219,271	$ 3,480,117	$ 6,432,017	$ 6,996,561
Ceded reinsurance premiums and policy fees	(769,335)	(863,967)	(1,545,037)	(1,772,065)
Net investment income	4,762,126	2,428,499	9,143,518	9,379,255
Other income	510,660	531,485	1,032,019	1,079,179
Revenues before realized gains	7,722,722	5,576,134	15,062,517	15,682,930
Realized investment gains (losses), net:
Other-than-temporary impairments	0	0	(26,926)	0
Other realized investment gains, net	576,841	3,846,725	648,490	10,982,695
Total realized investment gains, net	576,841	3,846,725	621,564	10,982,695
Total revenue	8,299,563	9,422,859	15,684,081	26,665,625
Benefits, claims and settlement expenses:
Life	5,108,457	5,526,152	10,964,778	11,396,960
Ceded Reinsurance benefits and claims	(599,574)	(1,192,533)	(1,197,353)	(2,028,408)
Annuity	290,892	218,229	558,431	478,919
Dividends to policyholders	149,077	125,646	296,299	266,270
Commissions and amortization of deferred policy acquisition costs	(26,906)	(131,671)	(50,458)	(284,484)
Amortization of cost of insurance acquired	266,088	286,375	532,176	572,750
Operating expenses	1,975,001	2,410,634	4,030,126	5,286,129
Interest expense	144,101	82,523	254,538	154,698
Total benefits and other expenses	7,307,136	7,325,355	15,388,537	15,842,834
Income before income taxes	992,427	2,097,504	295,544	10,822,791
Income tax expense	79,343	(503,685)	12,035	(3,729,241)
Net income	1,071,770	1,593,819	307,579	7,093,550
Net income attributable to noncontrolling interests	(196,702)	(153,164)	(342,783)	(426,378)
Net income attributable to common shareholders'	$ 875,068	$ 1,440,655	$ (35,204)	$ 6,667,172
Amounts attributable to common shareholders':
Basic income per share (in dollars per share)	$ 0.23	$ 0.38	$ (0.01)	$ 1.74
Diluted income per share (in dollars per share)	$ 0.23	$ 0.38	$ (0.01)	$ 1.74
Basic weighted average shares outstanding (in shares)	3,792,203	3,814,403	3,794,317	3,825,802
Diluted weighted average shares outstanding (in shares)	3,792,203	3,814,403	3,794,317	3,825,802

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FAIR VALUE MEASUREMENTS

6 Months Ended

Jun. 30, 2013

FAIR VALUE MEASUREMENTS [Abstract]

FAIR VALUE MEASUREMENTS

Note 4 – Fair Value Measurements

The Company measures its assets and liabilities recorded at fair value in the Condensed Consolidated Balance Sheets based on the framework set forth in the GAAP fair value accounting guidance.  The framework establishes a fair value hierarchy of three levels based upon the transparency of information used in measuring the fair value of assets or liabilities as of the measurement date.  The fair value hierarchy prioritizes the inputs in the valuation techniques used to measure fair value into three categories.

Level 1 – Valuation is based upon quoted prices for identical assets or liabilities in active markets that the Company is able to access.  Level 1 fair value is not subject to valuation adjustments.

Level 2 – Valuation is based upon quoted prices for similar assets and liabilities in active markets or quoted prices for identical or similar instruments in markets that are not active. In addition, the Company may use various valuation techniques or pricing models that use observable inputs to measure fair value.

Level 3 – Valuation is based upon unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Unobservable inputs reflect the Company's own assumptions about the inputs that market participants would use in pricing the asset or liability.

The Company determines the existence of an active market for an asset or liability based on its judgment as to whether transactions for the asset or liability occur in such market with sufficient frequency and volume to provide reliable pricing information.  If the Company concludes that there has been a significant decrease in the volume and level of activity for an investment in relation to normal market activity for such investment, adjustments to transactions and quoted prices are made to estimate fair value.

The inputs used in the valuation techniques employed by the Company are provided by nationally recognized pricing services, external investment managers and internal resources.  To assess these inputs, the Company's review process includes, but is not limited to, quantitative analysis including benchmarking, initial and ongoing evaluations of methodologies used by external parties to calculate fair value, and ongoing evaluations of fair value estimates based on the Company's knowledge and monitoring of market conditions.

The Company periodically reviews the pricing service provider's policies and procedures for valuing securities.  The assumptions underlying the valuations from external service providers, including unobservable inputs, are generally not readily available as this information is often deemed proprietary.  Accordingly, the Company is unable to obtain comprehensive information regarding these assumptions and methodologies.

The Company's investments in fixed maturity securities available for sale, equity securities available for sale and trading securities assets and liabilities are carried at fair value.  The following are the Company's methodologies and valuation techniques for assets and liabilities measured at fair value.

Fixed maturities available for sale mainly consist of U.S. treasury securities and corporate debt securities. The Company employs a market approach to the valuation of securities where there are sufficient market transactions involving identical or comparable assets. If sufficient market data is not available for identical or comparable assets, the Company uses an income approach to valuation. The majority of the financial instruments included in fixed maturity securities available for sale are evaluated utilizing observable inputs; accordingly, they are categorized in either Level 1 or Level 2 of the fair value hierarchy. However, in instances where significant inputs utilized in valuation of the securities are unobservable, the securities are categorized in Level 3 of the fair value hierarchy.

Corporate securities primarily include fixed rate corporate bonds. Inputs utilized in connection with the Company's valuation techniques relating to this class of securities include recently executed transactions, market price quotations, benchmark yields and issuer spreads. Corporate securities are categorized in Level 2 of the fair value hierarchy.

U.S. treasury securities are based on quoted prices in active markets and are generally categorized in Level 1 of the fair value hierarchy.

Equity securities available for sale consist of common and preferred stocks mainly in private equity investments, financial institutions and insurance companies. Equity securities for which there is sufficient market data are categorized as Level 1 or 2 in the fair value hierarchy.  For the equity securities in which quoted market prices are not available, the transaction price is used as the best estimate of fair value at inception.  When evidence is believed to support a change to the carrying value from the transaction price, adjustments are made to reflect the expected exit values. The Company performs ongoing reviews of the underlying investments. The reviews consist of the evaluations of expected cash flows, material events and market data. These investments are included in Level 3 of the fair value hierarchy.

Securities designated as trading securities consist of bonds, exchange traded equities and exchange traded options.  These securities are primarily valued at quoted active market prices, and are therefore categorized as Level 1 in the fair value hierarchy.  The exchange traded bonds consist of corporate bonds and are classified as Level 2, consistent with the classification of the fixed maturity corporate bonds.

The following table presents the Company's assets and liabilities measured at fair value in the condensed consolidated balance sheet on a recurring basis as of June 30, 2013.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	20,405,327	$	153,446,375	$	332,137	$	174,183,839
Equity Securities, available for sale		1,600,776		7,350,216		29,940,181		38,891,173
Trading Securities		5,786,943		0		0		5,786,943
Total	$	27,793,046	$	160,796,591	$	30,272,318	$	218,861,955
Liabilities
Trading Securities	$	869,761	$	0	$	0	$	869,761

The following table presents the Company's assets and liabilities measured at fair value in the Condensed Consolidated Balance Sheet on a recurring basis as of December 31, 2012.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	20,993,398	$	166,060,160	$	273,727	$	187,327,285
Equity Securities, available for sale		1,448,585		6,092,614		22,963,715		30,504,914
Trading Securities		13,903,148		115,312		0		14,018,460
Total	$	36,345,131	$	172,268,086	$	23,237,442	$	231,850,659
Liabilities
Trading Securities	$	7,552,704	$	0	$	0	$	7,552,704

The following table provides reconciliations for Level 3 assets measured at fair value on a recurring basis. Transfers into and out of Level 3 are recognized as of the end of the quarter in which they occur.

	Fixed Maturities, Available for Sale		Equity Securities, Available for Sale			Total
Balance at December 31, 2012	$	273,727	$	22,963,715		$	23,237,442
Total unrealized gain or losses:
Included in other comprehensive income		58,410		(43,054	)		15,356
Purchases		0		7,019,520			7,019,520
Balance at June 30, 2013	$	332,137	$	29,940,181		$	30,272,318

The Level 3 securities include collateralized debt obligations of trust preferred securities issued by banks and insurance companies and certain equity securities with unobservable inputs.  None of the collateral is subprime or Alt-A mortgages (loans for which the typical documentation was not provided by the borrower).

Certain assets are not carried at fair value on a recurring basis, including investments such as mortgage loans and policy loans. Accordingly such investments are only included in the fair value hierarchy disclosure when the investment is subject to re-measurement at fair value after initial recognition and the resulting re-measurement is reflected in the condensed consolidated financial statements.

The carrying values and estimated fair values of certain of the Company's financial instruments not recorded at fair value in the condensed consolidated balance sheets are shown below. Because the fair value for all condensed consolidated balance sheet items are not required to be disclosed, the aggregate fair value amounts presented below are not reflective of the underlying value of the Company.

	June 30, 2013				December 31, 2012
Assets	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Mortgage loans on real estate	$	10,103,247	$	10,173,968	$	17,671,554	$	17,803,159
Discounted mortgage loans		25,043,446		25,043,446		26,336,953		26,336,953
Investment real estate		77,974,348		77,974,348		68,165,013		68,165,013
Policy loans		12,059,168		12,059,168		12,591,572		12,591,572
Cash and cash equivalents		22,282,466		22,282,466		23,321,246		23,321,246
Short term investments		0		0		6,268,320		6,268,320
Liabilities
Notes payable		18,655,035		18,655,035		18,857,954		18,857,954

The above estimated fair value amounts have been determined based upon the following valuation methodologies. Considerable judgment was required to interpret market data in order to develop these estimates. Accordingly, the estimates are not necessarily indicative of the amounts which could be realized in a current market exchange.  The use of different market assumptions or estimation methodologies may have a material effect on the fair value amounts.

The fair values of mortgage loans on real estate are estimated using discounted cash flow analyses and interest rates being offered for similar loans to borrowers with similar credit ratings.  The inputs used to measure the fair value of our mortgage loans on real estate are classified as Level 3 within the fair value hierarchy.

The Company has been purchasing non-performing discounted mortgage loans at a deep discount through an auction process led by the federal government.  In general, the discounted loans are non-performing and there is a significant amount of uncertainty surrounding the timing and amount of cash flows to be received by the Company.  Accordingly, the Company records its investment in the discounted loans at its original purchase price, which management believes approximates fair value.  The inputs used to measure the fair value of our discounted mortgage loans are classified as Level 3 within the fair value hierarchy.

Investment real estate is recorded at the lower of the net investment in the real estate or the fair value of the real estate less costs to sell.  The determination of fair value assessments are performed on a periodic, non-recurring basis by external appraisal and assessment of property values by management.  The inputs used to measure the fair value of our investment real estate are classified as Level 3 within the fair value hierarchy.

Policy loans are carried at the aggregate unpaid principal balances in the consolidated balance sheets which approximate fair value, and earn interest at rates ranging from 4 % to 8 %.  Individual policy liabilities in all cases equal or exceed outstanding policy loan balances.  The inputs used to measure the fair value of our policy loans are classified as Level 3 within the fair value hierarchy.

The carrying amount of cash and cash equivalents in the financial statements approximates fair value given the highly liquid nature of the instruments.  The inputs used to measure the fair value of our cash and cash equivalents are classified as Level 1 within the fair value hierarchy.

The carrying amount of short term investments in the financial statements approximates fair value.  The inputs used to measure the fair value of our short term investments are classified as Level 3 within the fair value hierarchy.

The carrying value is a reasonable estimate of fair value for notes payable subject to floating rates of interest.  The fair value of notes payable with fixed rate borrowings is determined based on the borrowing rates currently available to the Company for loans with similar terms and average maturities.  The inputs used to measure the fair value of our notes payable are classified as Level 2 within the fair value hierarchy.

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FAIR VALUE MEASUREMENTS (Details) (USD $)	3 Months Ended	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2012	Dec. 31, 2011
Assets [Abstract]
Fixed Maturities, available for sale	$ 174,183,839	$ 174,183,839	$ 187,327,285
Trading Securities	5,786,943	5,786,943	14,018,460
Liabilities [Abstract]
Trading Securities	869,762	869,762	6,050,344
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance		23,237,442
Total Unrealized Gains (Losses) Included in Other Comprehensive Income	15,356
Purchases	7,019,520
Ending Balance	30,272,318	30,272,318
Assets [Abstract]
Discounted mortgage loans	25,043,446	25,043,446	26,336,953
Investment real estate	77,974,348	77,974,348	68,165,013
Cash and cash equivalents	22,282,466	22,282,466	23,321,246	15,649,812	82,925,675
Liabilities [Abstract]
Policy loan interest rate, minimum (in hundredths)		4.00%
Policy loan interest rate, maximum (in hundredths)		8.00%
Carrying Amount [Member]
Assets [Abstract]
Mortgage loans on real estate	10,103,247	10,103,247	17,671,554
Discounted mortgage loans	25,043,446	25,043,446	26,336,953
Investment real estate	77,974,348	77,974,348	68,165,013
Policy Loans	12,059,168	12,059,168	12,591,572
Cash and cash equivalents	22,282,466	22,282,466	23,321,246
Other Assets, Fair Value Disclosure	0	0	6,268,320
Liabilities [Abstract]
Notes payable	18,655,035	18,655,035	18,857,954
Estimated Fair Value [Member]
Assets [Abstract]
Mortgage loans on real estate	10,173,968	10,173,968	17,803,159
Discounted mortgage loans	25,043,446	25,043,446	26,336,953
Investment real estate	77,974,348	77,974,348	68,165,013
Policy Loans	12,059,168	12,059,168	12,591,572
Cash and cash equivalents	22,282,466	22,282,466	23,321,246
Other Assets, Fair Value Disclosure	0	0	6,268,320
Liabilities [Abstract]
Notes payable	18,655,035	18,655,035	18,857,954
Fixed Maturities [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance			273,727
Total Unrealized Gains (Losses) Included in Other Comprehensive Income	58,410
Purchases	0
Ending Balance	332,137	332,137	273,727
Equity Securities [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance			22,963,715
Total Unrealized Gains (Losses) Included in Other Comprehensive Income	(43,054)
Purchases	7,019,520
Ending Balance	29,940,181	29,940,181	22,963,715
Measured on a recurring basis [Member]
Assets [Abstract]
Fixed Maturities, available for sale	174,183,839	174,183,839	187,327,285
Equity Securities, available for sale	38,891,173	38,891,173	30,504,914
Trading Securities	5,786,943	5,786,943	14,018,460
Total Financial Assets	218,861,955	218,861,955	231,850,659
Liabilities [Abstract]
Trading Securities	869,761	869,761	7,552,704
Measured on a recurring basis [Member] | Level 1 [Member]
Assets [Abstract]
Fixed Maturities, available for sale	20,405,327	20,405,327	20,993,398
Equity Securities, available for sale	1,600,776	1,600,776	1,448,585
Trading Securities	5,786,943	5,786,943	13,903,148
Total Financial Assets	27,793,046	27,793,046	36,345,131
Liabilities [Abstract]
Trading Securities	869,761	869,761	7,552,704
Measured on a recurring basis [Member] | Level 2 [Member]
Assets [Abstract]
Fixed Maturities, available for sale	153,446,375	153,446,375	166,060,160
Equity Securities, available for sale	7,350,216	7,350,216	6,092,614
Trading Securities	0	0	115,312
Total Financial Assets	160,796,591	160,796,591	172,268,086
Liabilities [Abstract]
Trading Securities	0	0	0
Measured on a recurring basis [Member] | Level 3 [Member]
Assets [Abstract]
Fixed Maturities, available for sale	332,137	332,137	273,727
Equity Securities, available for sale	29,940,181	29,940,181	22,963,715
Trading Securities	0	0	0
Total Financial Assets	30,272,318	30,272,318	23,237,442
Liabilities [Abstract]
Trading Securities	$ 0	$ 0	$ 0

XML

FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2013

FAIR VALUE MEASUREMENTS [Abstract]

Financial assets and liabilities measured on recurring basis

The following table presents the Company's assets and liabilities measured at fair value in the condensed consolidated balance sheet on a recurring basis as of June 30, 2013.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	20,405,327	$	153,446,375	$	332,137	$	174,183,839
Equity Securities, available for sale		1,600,776		7,350,216		29,940,181		38,891,173
Trading Securities		5,786,943		0		0		5,786,943
Total	$	27,793,046	$	160,796,591	$	30,272,318	$	218,861,955
Liabilities
Trading Securities	$	869,761	$	0	$	0	$	869,761

The following table presents the Company's assets and liabilities measured at fair value in the Condensed Consolidated Balance Sheet on a recurring basis as of December 31, 2012.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	20,993,398	$	166,060,160	$	273,727	$	187,327,285
Equity Securities, available for sale		1,448,585		6,092,614		22,963,715		30,504,914
Trading Securities		13,903,148		115,312		0		14,018,460
Total	$	36,345,131	$	172,268,086	$	23,237,442	$	231,850,659
Liabilities
Trading Securities	$	7,552,704	$	0	$	0	$	7,552,704

The following table provides reconciliations for Level 3 assets measured at fair value on a recurring basis. Transfers into and out of Level 3 are recognized as of the end of the quarter in which they occur.

	Fixed Maturities, Available for Sale		Equity Securities, Available for Sale			Total
Balance at December 31, 2012	$	273,727	$	22,963,715		$	23,237,442
Total unrealized gain or losses:
Included in other comprehensive income		58,410		(43,054	)		15,356
Purchases		0		7,019,520			7,019,520
Balance at June 30, 2013	$	332,137	$	29,940,181		$	30,272,318

Estimated fair value of financial instruments required to be valued by ASC 820

The carrying values and estimated fair values of certain of the Company's financial instruments not recorded at fair value in the condensed consolidated balance sheets are shown below. Because the fair value for all condensed consolidated balance sheet items are not required to be disclosed, the aggregate fair value amounts presented below are not reflective of the underlying value of the Company.

	June 30, 2013				December 31, 2012
Assets	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Mortgage loans on real estate	$	10,103,247	$	10,173,968	$	17,671,554	$	17,803,159
Discounted mortgage loans		25,043,446		25,043,446		26,336,953		26,336,953
Investment real estate		77,974,348		77,974,348		68,165,013		68,165,013
Policy loans		12,059,168		12,059,168		12,591,572		12,591,572
Cash and cash equivalents		22,282,466		22,282,466		23,321,246		23,321,246
Short term investments		0		0		6,268,320		6,268,320
Liabilities
Notes payable		18,655,035		18,655,035		18,857,954		18,857,954

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COMMITMENTS AND CONTINGENCIES (Details) (USD $)	Jun. 30, 2013
Liability for contingent costs [Line Items]
Cost contingency, tier one (in hundredths)	100.00%
Cost contingency threshold, tier one	$ 50,000
Cost contingency, tier two (in hundredths)	90.00%
Cost contingency threshold, tier two	50,000
Cost contingency, tier three (in hundredths)	75.00%
Cost contingency threshold, tier three	50,000
Cost contingency, tier four (in hundredths)	50.00%
Cost contingency threshold, tier four	150,000
Estimate of cost contingency, total	50,000
Loss Contingency	47,727
RLF III, LLC [Member]
Investment Commitment [Line Items]
Total Funding Commitment	4,000,000
Unfunded Commitment	398,120
Llano Music, LLC [Member]
Investment Commitment [Line Items]
Total Funding Commitment	2,000,000
Unfunded Commitment	571,000
Marcellus III, LLC [Member]
Investment Commitment [Line Items]
Total Funding Commitment	1,250,000
Unfunded Commitment	281,875
Dew Learning, LLC [Member]
Investment Commitment [Line Items]
Total Funding Commitment	1,000,000
Unfunded Commitment	265,004
Marcellus HBPI, LLP [Member]
Investment Commitment [Line Items]
Total Funding Commitment	1,800,000
Unfunded Commitment	573,300
PBEX, LLC [Member]
Investment Commitment [Line Items]
Total Funding Commitment	5,625,000
Unfunded Commitment	2,818,750
Sovereign's Capital, LP [Member]
Investment Commitment [Line Items]
Total Funding Commitment	500,000
Unfunded Commitment	250,000
ACAP [Member]
Liability for contingent costs [Line Items]
Estimate of cost contingency, total	$ 2,550,822
Share Conversion	233

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SHAREHOLDERS' EQUITY (Details) (USD $)	6 Months Ended
	Jun. 30, 2013
STOCK REPURCHASE PROGRAM [Abstract]
Stock repurchase program authorized amount	$ 6,000,000
Treasury Stock, Shares, Acquired	7,609
Amount paid to repurchase shares during the year	103,625
Amount of common stock repurchased	$ 4.7
Number of common stock acquired (in shares)	570,299

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CREDIT ARRANGEMENTS (Details) (USD $)	6 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Scheduled principal reductions on notes payable for the next five years [Abstract]
2013	$ 1,655,035
2014	5,000,000
2015	345,460
2016	478,193
2017	499,277
UTG 2012-11-20 [Member]
Lines of Credit [Line Items]
Issue Date	Nov. 20, 2012
Maturity Date	Nov. 20, 2013
Revolving Credit Limit	8,000,000
Outstanding Balance	1,655,035	1,655,035
Borrowings	0
Repayments	0
Interest Rate	3.75%
Assets Pledged	100% of the common voting stock of its wholly owned subsidiary, Universal Guaranty Life Insurance Company (“UG”).
UTG Avalon 2011-12-28 [Member]
Lines of Credit [Line Items]
Issue Date	Dec. 28, 2011
Maturity Date	Jan. 03, 2014
Revolving Credit Limit	5,000,000
Outstanding Balance	0	5,000,000
Borrowings	0
Repayments	5,000,000
Interest Rate	4.00%
Frequency of Payments	two semi-annual
UTG Avalon 2013-03-28 [Member]
Lines of Credit [Line Items]
Issue Date	Mar. 28, 2013
Maturity Date	Mar. 28, 2014
Revolving Credit Limit	5,000,000
Outstanding Balance	5,000,000	0
Borrowings	5,000,000
Repayments	0
Interest Rate	4.00%
Frequency of Payments	two semi-annual
Interest Rate Description	0.50% above the lowest of the U.S. Prime Rates as published in the money section of the Wall Street Journal.
UG 2010-12-28 [Member]
Lines of Credit [Line Items]
Issue Date	Dec. 28, 2010
Maturity Date	Dec. 06, 2013
Revolving Credit Limit	15,000,000
Outstanding Balance	0	0
Borrowings	0
Repayments	0
Additional Credit Capacity	up to a maximum of 50% of the total assets of UG.
Borrowing Capacity	based on 50 times each dollar of stock acquired in FHLB above the “base membership” amount.
HPG Acquisition 2007-02-07 [Member]
Debt Instrument [Line Items]
Issue Date	Feb. 07, 2007
Maturity Date	Nov. 07, 2017
Outstanding Principal Balance	0	202,919
Interest Rate	5.00%
HPG Acquisitions 2012-12-27 [Member]
Debt Instrument [Line Items]
Issue Date	Dec. 27, 2012
Maturity Date	Mar. 04, 2018
Outstanding Principal Balance	$ 12,000,000	$ 12,000,000
Interest Rate	4.00%

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Statement of Cash Flows (USD $)	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Cash flows from operating activities:
Net income attributable to common shareholders	$ (35,204)	$ 6,667,172
Adjustments to reconcile net income to net cash used in operating activities net of changes in assets and liabilities resulting from the sales and purchases of subsidiaries:
Amortization (accretion) of investments	(1,462,254)	(874,286)
Realized investment gains, net	(621,564)	(10,982,695)
Unrealized trading gains included in income	(49,545)	(167,251)
Amortization of deferred policy acquisition costs	28,216	31,024
Amortization of cost of insurance acquired	532,176	572,750
Depreciation	640,571	638,394
Net income attributable to noncontrolling interest	342,783	426,378
Charges for mortality and administration of universal life and annuity products	(3,458,497)	(3,541,227)
Interest credited to account balances	2,662,628	2,551,509
Change in accrued investment income (loss)	138,634	(1,418,809)
Change in reinsurance receivables	1,072,113	1,486,180
Change in policy liabilities and accruals	(2,642,960)	(2,191,530)
Change in income taxes receivable (payable)	(3,463,692)	2,526,735
Change in other assets and liabilities, net	633,298	1,723
Net cash provided by (used in) operating activities	(5,683,297)	(4,273,933)
Proceeds from investments sold and matured:
Fixed maturities available for sale	21,247,954	79,045,533
Equity securities available for sale	238,330	559,865
Trading securities	23,753,619	7,148,992
Mortgage loans	9,004,089	2,583,581
Discounted mortgage loans	3,898,888	3,156,105
Real estate	4,063,257	8,808,213
Policy loans	2,029,941	1,982,303
Total proceeds from investments sold and matured	64,236,078	103,284,592
Cost of investments acquired:
Fixed maturities available for sale	(16,132,719)	(120,109,964)
Equity securities available for sale	(8,731,875)	(9,173,511)
Trading securities	(22,140,303)	(6,625,128)
Mortgage loans	(1,435,782)	(15,813,757)
Discounted mortgage loans	(1,436,582)	(6,040,124)
Real estate	(7,829,033)	(6,142,148)
Policy loans	(1,497,536)	(1,499,930)
Payments for (Proceeds from) Other Investing Activities	(25,000)	0
Total cost of investments acquired	(59,228,830)	(165,404,562)
Sale of property and equipment	0	17,440
Net cash used in investing activities	5,007,248	(62,102,530)
Cash flows from financing activities:
Policyholder contract deposits	2,884,121	2,990,832
Policyholder contract withdrawals	(2,940,308)	(3,364,427)
Proceeds from notes payable/line of credit	0	1,281,000
Payments of principal on notes payable/line of credit	(202,919)	(1,221,425)
Purchase of treasury stock	(103,625)	(571,380)
Distributions to minority interests of consolidated subsidiaries	0	(14,000)
Net cash provided by (used in) financing activities	(362,731)	(899,400)
Net increase (decrease) in cash and cash equivalents	(1,038,780)	(67,275,863)
Cash and cash equivalents at beginning of period	23,321,246	82,925,675
Cash and cash equivalents at end of period	$ 22,282,466	$ 15,649,812

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NEW ACCOUNTING STANDARDS

6 Months Ended

Jun. 30, 2013

NEW ACCOUNTING STANDARDS [Abstract]

NEW ACCOUNTING STANDARDS

Note 2 – New Accounting Standards

Comprehensive Income - In February 2013, the Financial Accounting Standards Board ("FASB") issued an accounting standard which requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. This guidance is effective for periods beginning after December 15, 2012. The adoption of this new guidance did not have a material impact on the Company's consolidated financial statements.

Intangibles-Goodwill and Other – In July 2012, FASB issued guidance on the testing of indefinite-lived intangible assets for impairment, which is intended to reduce the cost and complexity of the impairment test for indefinite-lived intangible assets by providing an entity with the option to first assess qualitatively whether it is necessary to perform the impairment test that is currently in place. An entity would not be required to quantitatively calculate the fair value of an indefinite-lived intangible asset unless the entity determines that it is more likely than not that its fair value is less than its carrying value. This guidance is effective for interim and annual impairment tests beginning after September 15, 2012, with early adoption permitted. The adoption of this new guidance did not have a material impact on the Company's consolidated financial statements.

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CREDIT ARRANGEMENTS

6 Months Ended

Jun. 30, 2013

NOTES PAYABLE [Abstract]

CREDIT ARRANGEMENTS

Note 5 – Credit Arrangements

At June 30, 2013 and December 31, 2012, the Company had the following outstanding debt:

					Outstanding Principal Balance
Instrument	Issue Date		Maturity Date		June 30, 2013		December 31, 2012
Promissory Note:
HPG Acquisitions		2007-02-07		2017-11-07	$	0	$	202,919
HPG Acquisitions		2012-12-27		2018-03-04		12,000,000		12,000,000

Instrument	Issue Date		Maturity Date		Revolving Credit Limit		December 31, 2012		Borrowings		Repayments		June 30, 2013
Lines of Credit:
UTG		2012-11-20		2013-11-20	$	8,000,000	$	1,655,035		0		0	$	1,655,035
UTG Avalon		2011-12-28		2014-01-03		5,000,000		5,000,000		0		5,000,000		0
UTG Avalon		2013-03-28		2014-03-28		5,000,000		0		5,000,000		0		5,000,000
UG		2010-12-28		2013-12-06		15,000,000		0		0		0		0

The HPG Acquisitions promissory note issued on February 7, 2007 bears interest at a fixed rate of 5%. This promissory note was fully repaid during the second quarter of 2013.

The HPG Acquisitions promissory note issued on December 27, 2012 is secured by real estate owned by HPG. The promissory note bears interest at a fixed rate of 4%. Interest is payable monthly. Principal is payable monthly beginning in the third year of the note.

The UTG line of credit carries interest at a fixed rate of 3.75% and is payable monthly. As collateral, UTG has pledged 100% of the common voting stock of its wholly owned subsidiary, Universal Guaranty Life Insurance Company ("UG"). The UTG line of credit was fully repaid on July 5, 2013.

The UTG Avalon line of credit issued on December 28, 2011 carried interest at a rate of 4.0% and was payable in two semi-annual payments. This line of credit was repaid during March 2013.

The UTG Avalon line of credit issued on March 28, 2013 currently carries interest at a rate of 4.0% and is payable in two semi-annual payments. The interest rate is a variable rate that will be 0.50% above the lowest of the U.S. Prime Rates as published in the money section of the Wall Street Journal. The interest rate is subject to change monthly and changes in the interest rate will take effect on the first day of the month following the rate change.

UG is a member of the Federal Home Loan Bank ("FHLB").  This membership allows the Company access to additional credit up to a maximum of 50% of the total assets of UG.  To be a member of the FHLB, the Company was required to purchase shares of common stock of FHLB.  Borrowing capacity is based on 50 times each dollar of stock acquired in FHLB above the "base membership" amount.

The consolidated scheduled principal reductions on the notes payable for the next five years are as follows:

Year	Amount
2013	$	1,655,035
2014		5,000,000
2015		345,460
2016		478,193
2017		499,277

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INVESTMENTS

6 Months Ended

Jun. 30, 2013

INVESTMENTS [Abstract]

INVESTMENTS

Note 3 – Investments

Available for Sale Securities – Fixed Maturity and Equity Securities

The Company's insurance subsidiary is regulated by insurance statutes and regulations as to the type of investments they are permitted to make, and the amount of funds that may be used for any one type of investment.

Investments in available for sale securities are summarized as follows:

June 30, 2013	Original or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Investments available for sale:
Fixed maturities
U.S. Government and govt. agencies and authorities	$	33,659,574	$	3,762,559	$	(104,398	)	$	37,317,735
States, municipalities and political subdivisions		140,000		1,674		0			141,674
U.S. special revenue and assessments		2,151,464		120,169		0			2,271,633
Collateralized mortgage obligations		1,580,787		127,752		0			1,708,539
Public utilities		399,906		51,013		0			450,919
All other corporate bonds		130,839,121		4,458,128		(3,003,910	)		132,293,339
		168,770,852		8,521,295		(3,108,308	)		174,183,839
Equity securities		38,010,235		1,693,133		(812,195	)		38,891,173
Total	$	206,781,087	$	10,214,428	$	(3,920,503	)	$	213,075,012

December 31, 2012	Original or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Investments available for sale:
Fixed maturities
U.S. Government and govt. agencies and authorities	$	33,430,165	$	5,457,009	$	0		$	38,887,174
States, municipalities and political subdivisions		160,000		6,637		0			166,637
U.S. special revenue and assessments		2,150,070		153,545		0			2,303,615
Collateralized mortgage obligations		2,241,384		183,409		(8	)		2,424,785
Public utilities		399,900		63,662		0			463,562
All other corporate bonds		135,145,198		9,747,565		(1,811,251	)		143,081,512
		173,526,717		15,611,827		(1,811,259	)		187,327,285
Equity securities		29,497,001		1,303,328		(295,415	)		30,504,914
Total	$	203,023,718	$	16,915,155	$	(2,106,674	)	$	217,832,199

The amortized cost and estimated market value of debt securities at June 30, 2013, by contractual maturity, is shown below.  Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Fixed Maturities Available for Sale June 30, 2013	Amortized Cost		Estimated Fair Value
Due in one year or less	$	947,312	$	966,456
Due after one year through five years		20,606,308		22,025,918
Due after five years through ten years		112,832,650		116,653,174
Due after ten years		32,628,844		32,651,711
Collateralized mortgage obligations		1,755,738		1,886,580
Total	$	168,770,852	$	174,183,839

The fair value of investments with sustained gross unrealized losses at June 30, 2013 and December 31, 2012 are as follows:

June 30, 2013	Less than 12 months					12 months or longer					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
U.S. Government and govt. agencies and authorities	$	4,891,795		(104,398	)	$	0		0		$	4,891,795		(104,398	)
All other corporate bonds		44,750,024		(1,026,652	)		4,130,719		(1,977,258	)		48,880,743		(3,003,910	)
Total fixed maturities	$	49,641,819		(1,131,050	)	$	4,130,719		(1,977,258	)	$	53,772,538		(3,108,308	)
Equity securities	$	1,243,333		(812,195	)	$	0		0		$	1,243,333		(812,195	)

December 31, 2012	Less than 12 months					12 months or longer					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Collateralized mortgage obligations	$	4,513		(8	)	$	0		0		$	4,513		(8	)
All other corporate bonds		13,776,705		(245,846	)		385,823		(1,565,405	)		14,162,528		(1,811,251	)
Total fixed maturities	$	13,781,218		(245,854	)	$	385,823		(1,565,405	)	$	14,167,041		(1,811,259	)
Equity securities	$	594,081		(295,415	)	$	0		0		$	594,081		(295,415	)

Additional information regarding investments in an unrealized loss position is as follows:

	Less than 12 months	12 months or longer	Total
As of June 30, 2013
Fixed maturities	32	4	36
Equity securities	6	0	6
As of December 31, 2012
Fixed maturities	8	3	11
Equity securities	9	0	9

Substantially all of the unrealized losses on fixed maturities available for sale at June 30, 2013 and December 31, 2012 are attributable to changes in market interest rates and general disruptions in the credit market subsequent to purchase.  The unrealized losses on equity investments were primarily attributable to normal market fluctuations.  The Company does not currently intend to sell nor does it expect to be required to sell any of the securities in an unrealized loss position.  Based upon the Company's expected continuation of receipt of contractually required principal and interest payments and its intent and ability to retain the securities until price recovery, as well as the Company's evaluation of other relevant factors, the Company deems these securities to be temporarily impaired as of June 30, 2013 and December 31, 2012.

The Company regularly reviews its investment securities for factors that may indicate that a decline in fair value of an investment is other than temporary.  The factors considered by management in its regular review to identify and recognize other-than-temporary impairment losses on fixed maturities include, but are not limited to: the length of time and extent to which the fair value has been less than cost; the Company's intent to sell, or be required to sell, the debt security before the anticipated recovery of its remaining amortized cost basis; the financial condition and near-term prospects of the issuer; adverse changes in ratings announced by one or more rating agencies; subordinated credit support, whether the issuer of a debt security has remained current on principal and interest payments; current expected cash flows; whether the decline in fair value appears to be issuer specific or, alternatively, a reflection of general market or industry conditions, including the effect of changes in market interest rates.  If the Company intends to sell a debt security, or it is more likely than not that it would be required to sell a debt security before the recovery of its amortized cost basis, the entire difference between the security's amortized cost basis and its fair value at the balance sheet date would be recognized by a charge to other-than-temporary losses in the Condensed Consolidated Statements of Operations.

Equity securities may experience other-than-temporary impairments in the future based on the prospects for full recovery in value in a reasonable period of time and the Company's ability and intent to hold the security to recovery.  If a decline in fair value is judged by management to be other-than-temporary or management does not have the intent or ability to hold a security, a loss is recognized by a charge to other-than-temporary impairment losses in the Condensed Consolidated Statements of Operations.

Based on management's review of the investment portfolio, the Company recorded the following losses for other-than-temporary impairments in the Condensed Consolidated Statements of Operations:

	Three Months Ended
	June 30,
	2013		2012
Other than temporary impairments:
Real Estate	$	0	$	0

	Six Months Ended
	June 30,
	2013		2012
Other than temporary impairments:
Real Estate	$	26,926	$	0

The other-than-temporary impairments recognized during 2013 were due to Management's assessment of the value of the real estate. The real estate was written down to better reflect current expected market value.

Trading Securities

Securities designated as trading securities are reported at fair value, with gains or losses resulting from changes in fair value recognized in net investment income on the Condensed Consolidated Statements of Operations.  Trading securities include exchange-traded equities and exchange-traded options.  Trading securities carried as liabilities are securities sold short. A gain, limited to the price at which the security was sold short, or a loss, potentially unlimited in size, will be recognized upon the termination of the short sale.  The fair value of derivatives included in trading security assets and trading security liabilities as of June 30, 2013 was $230,369 and $(869,762), respectively. The fair value of derivatives included in trading security assets and trading security liabilities as of December 31, 2012 was $6,745,528 and $(6,050,344), respectively.  Earnings from trading securities are classified in cash flows from operating activities. The derivatives held by the Company are for income generation purposes only.

Trading revenue charged to net investment income from trading securities was:

	Three Months Ended
	June 30,
	2013		2012
Net unrealized gains (losses)	$	346,889	$	(361,447	)
Net realized gains (losses)		129,591		(611,749	)
Net unrealized and realized gains (losses)	$	476,480	$	(973,196	)

	Six Months Ended
	June 30,
	2013		2012
Net unrealized gains (losses)	$	49,545	$	167,251
Net realized gains (losses)		215,862		1,698,758
Net unrealized and realized gains (losses)	$	265,407	$	1,866,009

Mortgage Loans

As of June 30, 2013 and December 31, 2012, the Company's mortgage loan portfolio contained 51 and 71 mortgage loans, including discounted mortgage loans, with a carrying value of $35,146,693 and $44,008,507, respectively.

Changes in the current economy could have a negative impact on the loans, including the financial stability of the borrowers, the borrowers' ability to pay or to refinance, the value of the property held as collateral and the ability to find purchasers at favorable prices.  Given the uncertainty of the current market, management has taken a conservative approach with the discounted mortgage loans and has classified all discounted mortgage loans held as non-accrual.  In such status, the Company is not recording any accrued interest income nor is it recording any accrual of discount on the loans held.  Discount accruals reported during 2012 and 2013 were the result of the loan basis already being fully paid.

On the remainder of the mortgage loan portfolio, interest accruals are analyzed based on the likelihood of repayment.  In no event will interest continue to accrue when accrued interest along with the outstanding principal exceeds the net realizable value of the property.  The Company does not utilize a specified number of days delinquent to cause an automatic non-accrual status.

A mortgage loan reserve is established and adjusted based on management's quarterly analysis of the portfolio and any deterioration in value of the underlying property which would reduce the net realizable value of the property below its current carrying value.  The Company acquires the discounted mortgage loans at below contract value, and believes that it will fully recover its carrying value upon disposal, therefore no reserve for delinquent loans is deemed necessary.  Those loans not currently paying are being vigorously worked by management.  The current discounted commercial mortgage loan portfolio has an average price of37.3 % of face value and management has determined that this deep discount provides a financial cushion or built in allowance for any of the loans that are not currently performing within the portfolio of loans purchased.

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OTHER CASH FLOW DISCLOSURES (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
OTHER CASH FLOW DISCLOSURES [Abstract]
Interest expense paid	$ 15,643	$ 134,399	$ 32,041	$ 149,613
Federal income tax	1,415,000	1,320,500	3,465,000	1,343,081
Noncash transaction LOC	5,000,000		5,000,000
Noncash transaction short term investments	6,300,000		6,300,000
Noncash transaction real estate	$ 6,300,000		$ 6,300,000

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Balance Sheet Parenthetical (USD $)	Jun. 30, 2013	Dec. 31, 2012
Investments available for sale:
Fixed maturities, amortized cost	$ 168,770,852	$ 173,526,717
Equity securities, cost	38,010,235	29,497,001
Trading securities, cost	5,962,028	14,714,333
Liabilities:
Trading Securities, Proceeds	$ 940,602	$ 8,094,787
Shareholders' equity:
Common stock, stated value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized (in shares)	7,000,000	7,000,000
Common stock, outstanding (in shares)	3,791,262	3,798,871

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OTHER CASH FLOW DISCLOSURES

6 Months Ended

Jun. 30, 2013

OTHER CASH FLOW DISCLOSURES [Abstract]

OTHER CASH FLOW DISCLOSURES

Note 8 – Other Cash Flow Disclosures

On a cash basis, the Company paid the following expenses:

	Three Months Ended
	June 30,
	2013		2012
Interest expense	$	15,643	$	134,399
Federal income tax		1,415,000		1,320,500

	Six Months Ended
	June 30,
	2013		2012
Interest expense	$	32,041	$	149,613
Federal income tax		3,465,000		1,343,081

During the first quarter of 2013, UG's wholly-owned subsidiary, UTG Avalon, LLC, entered into a noncash transaction whereby the subsidiary obtained a new line of credit in the amount of $5 million and utilized the line of credit to repay the prior line of credit. The terms of the new line of credit are consistent with the terms of the prior line of credit.

During the second quarter of 2013, UG and one of its subsidiaries, Cumberland Woodlands, LLC, entered into noncash transactions whereby short-term investments in the amount of $6.3 million were exchanged for real estate in the amount of $6.3 million.

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Condensed Consolidated Statement of Comprehensive Income (Unaudited) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Condensed Consolidated Statement of Comprehensive Income (Unaudited) [Abstract]
Net Income	$ 1,071,770	$ 1,593,819	$ 307,579	$ 7,093,550
Other comprehensive income, net of tax:
Unrealized holding gains/(losses) arising during period	(5,054,177)	2,438,608	(5,077,927)	(648,458)
Less reclassification adjustment for (gains)/losses included in net income	(414,509)	(2,494,211)	(473,875)	(5,810,420)
Subtotal: Other comprehensive income/(loss), net of tax	(5,468,686)	(55,603)	(5,551,802)	(6,458,878)
Comprehensive income	(4,396,916)	1,538,216	(5,244,223)	634,672
Less comprehensive income attributable to noncontrolling interests	(196,702)	(153,164)	(342,783)	(426,378)
Comprehensive income attributable to UTG, Inc.	$ (4,593,618)	$ 1,385,052	$ (5,587,006)	$ 208,294

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Balance Sheet (USD $)	Jun. 30, 2013	Dec. 31, 2012
Investments available for sale:
Fixed maturities, at fair value (amortized cost $168,770,852 and $173,526,717)	$ 174,183,839	$ 187,327,285
Equity securities, at fair value (cost $38,010,235 and $29,497,001)	38,891,173	30,504,914
Trading securities, at fair value (cost $5,962,028 and $14,714,333)	5,786,943	14,018,460
Mortgage loans on real estate at amortized cost	10,103,247	17,671,554
Discounted mortgage loans on real estate at cost	25,043,446	26,336,953
Investment real estate	77,974,348	68,165,013
Policy loans	12,059,168	12,591,572
Short-term investments	0	6,268,320
Total investments	344,042,164	362,884,071
Cash and cash equivalents	22,282,466	23,321,246
Accrued investment income	2,306,156	2,444,790
Future policy benefits	28,782,686	29,318,018
Policy claims and other benefits	3,955,649	4,492,430
Cost of insurance acquired	11,168,589	11,700,765
Deferred policy acquisition costs	398,002	426,218
Property and equipment, net of accumulated depreciation	1,261,046	1,344,851
Income tax receivable	1,448,723	20,035
Other assets	6,310,920	5,381,969
Total assets	421,956,401	441,334,393
Liabilities:
Future policyholder benefits	288,982,763	293,800,162
Policy claims and benefits payable	4,692,415	3,371,767
Other policyholder funds	420,884	477,948
Dividend and endowment accumulations	14,131,312	14,072,513
Income tax payable	7,782	2,042,786
Deferred income taxes	9,325,480	12,301,577
Notes payable	18,655,035	18,857,954
Trading securities, at fair value (proceeds $940,602 and $8,094,787)	869,761	7,552,704
Other liabilities	10,564,189	9,202,354
Total liabilities	347,649,621	361,679,765
Common stock - no par value, stated value $.001 per share. Authorized 7,000,000 shares - 3,791,262 and 3,798,871 shares outstanding	3,791	3,799
Additional paid-in capital	44,234,126	44,337,743
Retained earnings	21,882,114	21,917,318
Accumulated other comprehensive income	4,112,664	9,664,466
Total UTG shareholders' equity	70,232,695	75,923,326
Noncontrolling interests	4,074,085	3,731,302
Total shareholders' equity	74,306,780	79,654,628
Total liabilities and shareholders' equity	$ 421,956,401	$ 441,334,393

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INVESTMENTS (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Amortized cost and estimated value of debt securities, by contractual maturity [Abstract]
Due in one year or less	$ 966,456		$ 966,456
Due after one year through five years	22,025,918		22,025,918
Due after five years through ten years	116,653,174		116,653,174
Due after ten years	32,651,711		32,651,711
Collateralized mortgage obligations	1,886,580		1,886,580
Total	174,183,839		174,183,839
Fixed maturities [Abstract]
Original or Amortized Cost	206,781,087		206,781,087		203,023,718
Gross Unrealized Gains			10,214,428	16,915,155
Gross Unrealized Losses			(3,920,503)	(2,106,674)
Estimated Market Value	213,075,012		213,075,012		217,832,199
Amortized cost and estimated market value of debt securities, by contractual maturity [Abstract]
Due in one year or less	947,312		947,312
Due after one year through five years	20,606,308		20,606,308
Due after five years through ten years	112,832,650		112,832,650
Due after ten years	32,628,844		32,628,844
Collateralized mortgage obligation	1,755,738		1,755,738
Total	168,770,852		168,770,852
Other than temporary impairment losses, investments, available-for-sale securities	0	0	26,926	0
Trading Securities [Abstract]
Fair value, derivatives included in trading security assets	230,369		230,369		6,745,528
Fair value, derivative included in trading security liabilities	(869,762)		(869,762)		(6,050,344)
Trading securities, net unrealized gain (loss)	346,889	(361,447)	49,545	167,251
Trading securities, realized gain (loss)	129,591	(611,749)	215,862	1,698,758
Increase (Decrease) in Trading Securities [Abstract]
Net Realized and Unrealized Gain (Loss) on Trading Securities	476,480	(973,196)	265,407	1,866,009
Mortgages [Abstract]
Number of Mortgage Loans including Discounted Mortgage Loans	51		51		71
Mortgage Loans including Discounted Mortgage Loans	35,146,693		35,146,693		44,008,507
Mortgage loans reserve					0
Average purchase price to outstanding loan (in hundredths)			37.30%
U.S. Government and Government Agencies and Authorities [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	33,659,574		33,659,574		33,430,165
Gross Unrealized Gains			3,762,559	5,457,009
Gross Unrealized Losses			(104,398)	0
Estimated Market Value	37,317,735		37,317,735		38,887,174
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	4,891,795		4,891,795
Less than 12 months, Unrealized losses			(104,398)
Twelve months or longer, Fair value	0		0
Twelve months or longer, Unrealized losses			0
Total Fair value	4,891,795		4,891,795
Total Unrealized losses			(104,398)
US Special Revenue and Assessments [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	2,151,464		2,151,464		2,150,070
Gross Unrealized Gains			120,169	153,545
Gross Unrealized Losses			0	0
Estimated Market Value	2,271,633		2,271,633		2,303,615
States, Municipalities and Political Subdivisions [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	140,000		140,000		160,000
Gross Unrealized Gains			1,674	6,637
Gross Unrealized Losses			0	0
Estimated Market Value	141,674		141,674		166,637
Collateralized Mortgage Obligations [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	1,580,787		1,580,787		2,241,384
Gross Unrealized Gains			127,752	183,409
Gross Unrealized Losses			0	(8)
Estimated Market Value	1,708,539		1,708,539		2,424,785
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value					4,513
Less than 12 months, Unrealized losses				(8)
Twelve months or longer, Fair value					0
Twelve months or longer, Unrealized losses				0
Total Fair value					4,513
Total Unrealized losses				(8)
Public Utilities [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	399,906		399,906		399,900
Gross Unrealized Gains			51,013	63,662
Gross Unrealized Losses			0	0
Estimated Market Value	450,919		450,919		463,562
Debt Securities [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	168,770,852		168,770,852		173,526,717
Gross Unrealized Gains			8,521,295	15,611,827
Gross Unrealized Losses			(3,108,308)	(1,811,259)
Estimated Market Value	174,183,839		174,183,839		187,327,285
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	49,641,819		49,641,819		13,781,218
Less than 12 months, Unrealized losses			(1,131,050)	(245,854)
Twelve months or longer, Fair value	4,130,719		4,130,719		385,823
Twelve months or longer, Unrealized losses			(1,977,258)	(1,565,405)
Total Fair value	53,772,538		53,772,538		14,167,041
Total Unrealized losses			(3,108,308)	(1,811,259)
Less than 12 months Number of Securities	32		32		8
Twelve months or longer Number of Securities	4		4		3
Total Number of Securities	36		36		11
Equity Securities [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	38,010,235		38,010,235		29,497,001
Gross Unrealized Gains			1,693,133	1,303,328
Gross Unrealized Losses			(812,195)	(295,415)
Estimated Market Value	38,891,173		38,891,173		30,504,914
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	1,243,333		1,243,333		594,081
Less than 12 months, Unrealized losses			(812,195)	(295,415)
Twelve months or longer, Fair value	0		0		0
Twelve months or longer, Unrealized losses			0	0
Total Fair value	1,243,333		1,243,333		594,081
Total Unrealized losses			(812,195)	(295,415)
Less than 12 months Number of Securities	6		6		9
Twelve months or longer Number of Securities	0		0		0
Total Number of Securities	6		6		9
All Other Corporate Bonds [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	130,839,121		130,839,121		135,145,198
Gross Unrealized Gains			4,458,128	9,747,565
Gross Unrealized Losses			(3,003,910)	(1,811,251)
Estimated Market Value	132,293,339		132,293,339		143,081,512
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	44,750,024		44,750,024		13,776,705
Less than 12 months, Unrealized losses			(1,026,652)	(245,846)
Twelve months or longer, Fair value	4,130,719		4,130,719		385,823
Twelve months or longer, Unrealized losses			(1,977,258)	(1,565,405)
Total Fair value	48,880,743		48,880,743		14,162,528
Total Unrealized losses			$ (3,003,910)	$ (1,811,251)

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2013

COMMITMENTS AND CONTINGENCIES [Abstract]

COMMITMENTS AND CONTINGENCIES

Note 7 – Commitments and Contingencies

The insurance industry has experienced a number of civil jury verdicts which have been returned against life and health insurers in the jurisdictions in which the Company does business involving the insurers' sales practices, alleged agent misconduct, failure to properly supervise agents, and other matters.  Some of the lawsuits have resulted in the award of substantial judgments against the insurer, including material amounts of punitive damages.  In some states, juries have substantial discretion in awarding punitive damages in these circumstances.  In the normal course of business, the Company is involved from time to time in various legal actions and other state and federal proceedings.  Management is of the opinion that the ultimate disposition of the matters will not have a materially adverse effect on the Company's results of operations or financial position.

Under the insurance guaranty fund laws in most states, insurance companies doing business in a participating state can be assessed up to prescribed limits for policyholder losses incurred by insolvent or failed insurance companies.  Although the Company cannot predict the amount of any future assessments, most insurance guaranty fund laws currently provide that an assessment may be excused or deferred if it would threaten an insurer's financial strength.  Mandatory assessments may be partially recovered through a reduction in future premium tax in some states. The Company does not believe such assessments will be materially different from amounts already provided for in the financial statements, though the Company has no control over such assessments.

As part of the Texas Imperial Life Insurance Company sale, the Company remains contingently liable for certain costs pending the outcome of an ongoing race-based audit on Texas Imperial Life Insurance Company by the Texas Department of Insurance.  Under the agreement, the Company is responsible for 100% of the first $50,000 of costs, 90% of the next $50,000, 75% of the third $50,000 and 50% of the costs above $150,000.  Management had conservatively estimated the Company's exposure and other costs at $50,000 based on information provided to date from the examination team and has established a contingent liability of $47,727 in its financial statements.  This contingency expires December 30, 2013.

Within the Company's trading accounts, certain trading securities carried as liabilities represent securities sold short.  A gain, limited to the price at which the security was sold short, or a loss, potentially unlimited in size, will be recognized upon the termination of the short sale.

On November 9, 2011, ACAP shareholders approved a proposed merger with UTG whereby ACAP shareholders received 233 shares of UTG for each share previously held of ACAP.  On November 14, 2011, the merger was completed.  Certain of the ACAP shareholders dissented to the merger requesting the courts determine the value of the ACAP shares.  The legal case is currently in the discovery phase.  The Company has established a contingent liability of $2,550,822 to cover the anticipated proceeds due to the dissenting shareholders and associated legal and other costs.

The following table represents the total funding commitments and the unfunded commitment as of June 30, 2013 related to certain investments:

	Total Funding		Unfunded
	Commitment		Commitment
RLF III, LLC	$	4,000,000	$	398,120
Llano Music, LLC		2,000,000		571,000
Marcellus III, LLP		1,250,000		281,875
Dew Learning, LLC		1,000,000		265,004
Marcellus HBPI, LLP		1,800,000		573,300
PBEX, LLC		5,625,000		2,818,750
Sovereign's Capital, LP		500,000		250,000

During 2006, the Company committed to invest in RLF III, LLC ("RLF"), which makes land-based investment in undervalued assets. RLF does capital calls as funds are needed for continued land purchases.

During 2010, the Company made a commitment to invest in Llano Music, LLC ("Llano), which invests in music royalties. Llano does capital calls to its investors as funds are needed to acquire the royalty rights.

During 2011, the Company committed to invest in Marcellus III, LLP, which purchases land for leasing opportunities to those looking to harvest natural resources. Marcellus III, LLC does capital calls to its investors as funds are needed for continued land purchases.

During 2012, the Company made a commitment to investment in Dew Learning, LLC ("Dew"), which is involved in the marketing and distribution of an electronic education based classroom model. Dew does capital calls to investors as funds are needed for continued development of the program.

During 2012, the Company committed to invest in Marcellus HBPI, LLP, which purchases land for leasing opportunities to those looking to harvest natural resources. Marcellus HPBI, LLC does capital calls to investors as funds are needed for continued land purchases.

During 2012, the Company committed to invest in PBEX, LLC, which purchases land for leasing opportunities to those looking to harvest natural resources. PBEX, LLC does capital calls to investors as funds are needed for continued land purchases.

During 2012, the Company committed to invest in Sovereign's Capital, LP ("Sovereign's"), which invests in companies in emerging markets. Sovereign's is expected to call the remaining unfunded commitment during 2013.

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NEW ACCOUNTING STANDARDS (Policies)

6 Months Ended

Jun. 30, 2013

NEW ACCOUNTING STANDARDS [Abstract]

New Accounting Pronouncements, Policy [Policy Text Block]

Comprehensive Income - In February 2013, the Financial Accounting Standards Board ("FASB") issued an accounting standard which requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. This guidance is effective for periods beginning after December 15, 2012. The adoption of this new guidance did not have a material impact on the Company's consolidated financial statements.

Intangibles-Goodwill and Other – In July 2012, FASB issued guidance on the testing of indefinite-lived intangible assets for impairment, which is intended to reduce the cost and complexity of the impairment test for indefinite-lived intangible assets by providing an entity with the option to first assess qualitatively whether it is necessary to perform the impairment test that is currently in place. An entity would not be required to quantitatively calculate the fair value of an indefinite-lived intangible asset unless the entity determines that it is more likely than not that its fair value is less than its carrying value. This guidance is effective for interim and annual impairment tests beginning after September 15, 2012, with early adoption permitted. The adoption of this new guidance did not have a material impact on the Company's consolidated financial statements.

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SHAREHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2013

CAPITAL STOCK TRANSACTIONS [Abstract]

CAPITAL STOCK TRANSACTIONS

Note 6 – Shareholders' Equity

Stock Repurchase Programs

The Board of Directors of UTG authorized the repurchase in the open market or in privately negotiated transactions of up to $6 million of UTG's common stock. Repurchased shares are available for future issuance for general corporate purposes.  This program can be terminated at any time.  Open market purchases are made based on the last available market price and are generally limited to a maximum per share price of the most recent reported per share GAAP equity book value of the Company.  During the six month period ended June 30, 2013, the Company repurchased 7,609 shares through the stock repurchase program for $103,625.Through June 30, 2013, UTG has spent $4.7 million in the acquisition of 570,299 shares under this program.

Earnings Per Share Calculations

Earnings per share are based on the weighted average number of common shares outstanding during each period.  At June 30, 2013 and June 30, 2012, diluted earnings per share were the same as basic earnings per share since the Company had no dilutive instruments outstanding.

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BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2013

BASIS OF PRESENTATION [Abstract]

BASIS OF PRESENTATION

  Note 1 – Basis of Presentation

The accompanying condensed consolidated balance sheet as of December 31, 2012, which has been derived from audited financial statements, and the unaudited interim condensed consolidated financial statements include the accounts of UTG, Inc. (the "Parent") and its subsidiaries (collectively with the Parent, the "Company").  All significant intercompany accounts and transactions have been eliminated in consolidation.  The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 8 of regulation S-X.  Accordingly, they do not include all of the information and notes required by GAAP for audited annual financial statements.  The information furnished includes all adjustments and accruals of a normal recurring nature, which in the opinion of management, are necessary for a fair presentation of the results for the interim periods.  The unaudited condensed consolidated financial statements included herein and these related notes should be read in conjunction with the Company's consolidated financial statements, and the notes thereto, included in the Company's Annual Report on Form 10-K for the year ended December 31, 2012.  The Company's results of operations for the six month period ended June 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 31, 2013 or for any other future period.

This document at times will refer to the Registrant's largest shareholder, Mr. Jesse T. Correll and certain companies controlled by Mr. Correll.  Mr. Correll holds a majority ownership of First Southern Funding LLC ("FSF"), a Kentucky corporation, and First Southern Bancorp, Inc. ("FSBI"), a financial services holding company.  FSBI operates through its 100 % owned subsidiary bank, First Southern National Bank ("FSNB").  Banking activities are conducted through multiple locations within south-central and western Kentucky.  Mr. Correll is Chief Executive Officer and Chairman of the Board of Directors of UTG and is currently UTG's largest shareholder through his ownership control of FSF, FSBI and affiliates.  At June 30, 2013, Mr. Correll owns or controls directly and indirectly approximately 56 % of UTG's outstanding stock.

UTG's life insurance subsidiary, Universal Guaranty Life Insurance Company ("UG"), has several wholly-owned and majority-owned subsidiaries.  The subsidiaries were formed to hold certain real estate investments.  The real estate investments were placed into the limited liability companies and partnerships to provide additional protection to the policyholders and to UG.

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CREDIT ARRANGEMENTS (Tables)

6 Months Ended

Jun. 30, 2013

NOTES PAYABLE [Abstract]

Schedule of promissory note

At June 30, 2013 and December 31, 2012, the Company had the following outstanding debt:

					Outstanding Principal Balance
Instrument	Issue Date		Maturity Date		June 30, 2013		December 31, 2012
Promissory Note:
HPG Acquisitions		2007-02-07		2017-11-07	$	0	$	202,919
HPG Acquisitions		2012-12-27		2018-03-04		12,000,000		12,000,000

Schedule of lines of credit

Instrument	Issue Date		Maturity Date		Revolving Credit Limit		December 31, 2012		Borrowings		Repayments		June 30, 2013
Lines of Credit:
UTG		2012-11-20		2013-11-20	$	8,000,000	$	1,655,035		0		0	$	1,655,035
UTG Avalon		2011-12-28		2014-01-03		5,000,000		5,000,000		0		5,000,000		0
UTG Avalon		2013-03-28		2014-03-28		5,000,000		0		5,000,000		0		5,000,000
UG		2010-12-28		2013-12-06		15,000,000		0		0		0		0

Scheduled principal reduction on notes payable for the next five years

The consolidated scheduled principal reductions on the notes payable for the next five years are as follows:

Year	Amount
2013	$	1,655,035
2014		5,000,000
2015		345,460
2016		478,193
2017		499,277

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CONCENTRATIONS

6 Months Ended

Jun. 30, 2013

CONCENTRATIONS [Abstract]

CONCENTRATIONS

Note 9 – Concentrations of Credit Risk

The Company maintains cash balances in financial institutions that at times may exceed federally insured limits.  The Company maintains its primary operating cash accounts with First Southern National Bank, an affiliate of the largest shareholder of UTG, Mr. Jesse Correll, the Company's CEO and Chairman.  The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents.

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BASIS OF PRESENTATION (Details)	6 Months Ended
	Jun. 30, 2013
Subsidiary or Equity Method Investee [Line Items]
Ownership in subsidiary bank (in hundredths)	100.00%
Related Party Disclosure [Line Items]
Ownership or control of outstanding common stock directly or indirectly (in hundredths)	56.00%

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COMMITMENTS AND CONTINGENCIES (Tables)

6 Months Ended

Jun. 30, 2013

COMMITMENTS AND CONTINGENCIES [Abstract]

Funding commitment and unfunded commitment

The following table represents the total funding commitments and the unfunded commitment as of June 30, 2013 related to certain investments:

	Total Funding		Unfunded
	Commitment		Commitment
RLF III, LLC	$	4,000,000	$	398,120
Llano Music, LLC		2,000,000		571,000
Marcellus III, LLP		1,250,000		281,875
Dew Learning, LLC		1,000,000		265,004
Marcellus HBPI, LLP		1,800,000		573,300
PBEX, LLC		5,625,000		2,818,750
Sovereign's Capital, LP		500,000		250,000

XML

Document and Entity Information (USD $)	6 Months Ended
	Jun. 30, 2013	Apr. 26, 2013	Mar. 31, 2013
Document and Entity Information [Abstract]
Entity Registrant Name	UTG Inc
Entity Central Index Key	0000832480
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	No
Entity Filer Category	Smaller Reporting Company
Entity Public Float			$ 0
Entity Common Stock, Shares Outstanding		0
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2013

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OTHER CASH FLOW DISCLOSURES (Tables)

6 Months Ended

Jun. 30, 2013

OTHER CASH FLOW DISCLOSURES [Abstract]

Expenses paid on a cash basis

On a cash basis, the Company paid the following expenses:

	Three Months Ended
	June 30,
	2013		2012
Interest expense	$	15,643	$	134,399
Federal income tax		1,415,000		1,320,500

	Six Months Ended
	June 30,
	2013		2012
Interest expense	$	32,041	$	149,613
Federal income tax		3,465,000		1,343,081