10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

[X]	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended December 31, 2015
	or
[ ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _____________ to ______________

Commission File Number 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, Springfield, IL	62703
(Address of principal executive offices)	(Zip code)

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

Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Name of each exchange on which registered
None	None

Securities registered pursuant to Section 12(g) of the Act:

Title of class

Common Stock, stated value $.001 per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes [ ] No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes [ ] No [X]

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 [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, 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 [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10- K. [  ]

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

Large Accelerated Filer	[ ]	Accelerated Filer	[ ]
Non Accelerated Filer	[ ]	Smaller Reporting Company	[X]

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Act). Yes [ ] No [X]

As of June 30, 2015, shares of the Registrant's common stock held by non-affiliates (based upon the price of the last sale of $15.50 per share), had an aggregate market value of approximately $20,299,808.

At February 19, 2016 the Registrant had 3,709,087 outstanding shares of common stock, stated value $.001 per share.

Documents incorporated by reference: None

UTG, Inc.

Form 10-K

Year Ended December 31, 2015

TABLE OF CONTENTS

PART I	4
Item 1.   Business	4
Item 1A. Risk Factors	9
Item 1B. Unresolved Staff Comments	9
Item 2.   Properties	9
Item 3.   Legal Proceedings	9
Item 4.   Mine Safety Disclosures	9
PART II	10
Item 5.  Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	10
Item 6.   Selected Financial Data	11
Item 7.   Management's Discussion and Analysis of Financial Condition and Results of Operations	11
Item 7A. Quantitative and Qualitative Disclosures About Market Risk	20
Item 8.   Financial Statements and Supplementary Data	20
Item 9.   Changes in and Disagreements with Accountants on Accounting and Financial Disclosures	49
Item 9A. Controls and Procedures	49
Item 9B. Other Information	49
PART III	50
Item 10.  Directors, Executive Officers and Corporate Governance	50
Item 11.  Executive Compensation	54
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	55
Item 13.  Certain Relationships and Related Transactions, and Director Independence	58
Item 14.  Principal Accounting Fees and Services	58
PART IV	59
Item 15.  Exhibits and Financial Statement Schedules	59

Forward-Looking Statements

This report on Form 10-K 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.

PART I

Item 1. Business

Business Overview

UTG, Inc. (the "Registrant", "Company" or "UTG") is an insurance holding company incorporated in the state of Delaware in 2005. Its primary direct subsidiary is Universal Guaranty Life Insurance Company ("UG"). The Registrant and its primary subsidiary have only one significant segment, insurance. The Company's dominant business is individual life insurance, which includes the servicing of existing insurance business in-force, the acquisition of other companies in the insurance business, and the administration processing of life insurance business for other entities.

The holding company has no significant business operations of its own and relies on fees, dividends and other distributions from its operating subsidiary as the principal source of cash flows to meet its obligations.  Additional information regarding the cash flow and liquidity needs of the holding company can be found in the Liquidity and Capital Resources section of the Management's Discussion and Analysis of Financial Conditions and Results of Operations.

UG has several wholly-owned and majority-owned subsidiaries. The subsidiaries were formed to hold certain real estate and other investments. The investments were placed into the limited liability companies and partnerships to provide additional protection to the policyholders and to UG.

Increased global IT security threats and more sophisticated and targeted computer crime pose a risk to the security of systems and networks and the confidentiality, availability and integrity of data. Although the Company makes efforts to maintain the security and integrity of the networks and systems, there can be no assurance that the security efforts will be effective or that attempted security breaches or disruptions would not be successful or damaging. In the event a security breach or failure results in the disclosure of sensitive third party data or the transmission of harmful/malicious code to third parties, the Company could be subject to liability claims. The Company does not currently carry insurance coverage against such liabilities. Depending on their nature and scope, such threats also could potentially lead to improper use of our systems and networks, manipulation and destruction of data, loss of trade secrets, system downtimes and operational disruptions, which in turn, could adversely affect our reputation, competitiveness and results of operations.

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, a Kentucky corporation, ("FSF") 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 December 31, 2015, Mr. Correll owns or controls directly and indirectly approximately 57.61% of UTG's outstanding stock.

UTG's website is: www.utgins.com. Information regarding the Company, including recent filings with the Securities and Exchange Commission, are accessible via this website.

Insurance

UG's product portfolio consists of a limited number of life insurance product offerings. All of the products are individual life insurance products, with design variations from each other to provide choices to the customer. These variations generally center around the length of the premium paying period, length of the coverage period and whether the product accumulates cash value or not.

While the Company does not actively sell any new policies today, it has the following products available for issue:

Ten Pay Whole Life – This traditional insurance product has a level face amount and level premium is payable for the first ten policy years. This product is available for issue ages 0-65, and has a minimum face amount of $10,000. This policy can be used in conversion situations, where it is available up to age 75 at a minimum face amount of $5,000.

Tradition – The Tradition policy is a fixed premium whole life insurance policy. Premiums are level and payable for life.  Issue ages are 0-75. The minimum face amount is the greater of $10,000 or the amount of coverage provided by a $100 annual premium.

Kid Kare – The Kid Kare product is a single premium level term policy to age 21.  The product is sold in units, with one unit equal to a face amount of $5,000 for a single premium of $250. The policy is issued from ages 0-15 and has conversion privileges at age 21.

Reinsurance

As is customary in the insurance industry, the insurance subsidiary cedes insurance to, and assumes insurance from, other insurance companies under reinsurance agreements.  Reinsurance agreements are intended to limit a life insurer's maximum loss on a large or unusually hazardous risk or to obtain a greater diversification of risk.  The ceding insurance company remains primarily liable with respect to ceded insurance should any reinsurer be unable to meet the obligations assumed by it.  However, it is the practice of insurers to reduce their exposure to loss to the extent that they have been reinsured with other insurance companies.  The Company sets a limit on the amount of insurance retained on the life of any one person.  The Company will not retain more than $125,000, including accidental death benefits, on any one life.

The Company's reinsured business is ceded to numerous reinsurers.  The Company monitors the solvency of its reinsurers in seeking to minimize the risk of loss in the event of a failure by one of the parties.  The Company is primarily liable to the insureds even if the reinsurers are unable to meet their obligations.  The primary reinsurers of the Company are large, well-capitalized entities.  See Note 4 – Reinsurance in the Notes to the Consolidated Financial Statements for additional information regarding the Company's reinsurance activities.

Underwriting

The underwriting procedures of the insurance subsidiary are established by Management. Insurance policies are issued by the Company based upon underwriting practices established for each market in which the Company operates. Most policies are individually underwritten. Applications for insurance are reviewed to determine additional information required to make an underwriting decision, which depends on the amount of insurance applied for and the applicant's age and medical history. Additional information may include inspection reports, medical examinations, and statements from doctors who have treated the applicant in the past and, where indicated, special medical tests. After reviewing the information collected, the Company either issues the policy as applied for, issues with an extra premium charge because of unfavorable factors, or rejects the application. Substandard risks may be referred to reinsurers for full or partial reinsurance of the substandard risk.

Reserves

The applicable insurance laws under which the insurance subsidiary operates require that the insurance company report policy reserves as liabilities to meet future obligations on the policies in-force. These reserves are the amounts which, with the additional premiums to be received and interest thereon compounded annually at certain assumed rates, are calculated in accordance with applicable laws to be sufficient to meet the various policy and contract obligations as they mature. These laws specify that the reserves shall not be less than reserves calculated using certain mortality tables and interest rates.

The liabilities for traditional life insurance and accident and health insurance policy benefits are computed using a net level method. These liabilities include assumptions as to investment yields, mortality, withdrawals, and other assumptions based on the life insurance subsidiary's experience adjusted to reflect anticipated trends and to include provisions for possible unfavorable deviations. The Company makes these assumptions at the time the contract is issued or, in the case of contracts acquired by purchase, at the purchase date. Future policy benefits for individual life insurance and annuity policies are computed using interest rates ranging from 2% to 6% for life insurance and 2.5% to 7.5% for annuities. Benefit reserves for traditional life insurance policies include certain deferred profits on limited-payment policies that are being recognized in income over the policy term. Policy benefit claims are charged to expense in the period that the claims are incurred. The mortality rate assumptions for policies currently issued by the Company are based on 2001 select and ultimate tables. Withdrawal rate assumptions are based upon Linton B or Linton C, which are industry standard actuarial tables for forecasting assumed policy lapse rates.

Benefit reserves for universal life insurance and interest sensitive life insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. Policy benefits and claims that are charged to expense include benefit claims in excess of related policy account balances.

Investments

Investments are subject to applicable state insurance laws and regulations, which limit the concentration of investments in any one category or class and further limit the investment in any one issuer. Generally, these limitations are imposed as a percentage of statutory assets or percentage of statutory capital and surplus of each company.

The following table summarizes the Company's fixed maturities distribution at December 31, 2015 by ratings category as issued by Standard and Poor's, a leading ratings analyst.

Rating	2015
Investment Grade
AAA	8%
AA	16%
A	31%
BBB	38%
Below Investment Grade	7%
	100%

The following table shows the composition, average maturity and current yield on the average carrying value of the Company's investment portfolio at December 31, 2015.

	Average
	Carrying		Average	Average
Investments	Value		Maturity	Yield
Fixed maturities held for sale	$	191,300,277	10.8 years		4.47	%
Equity securities		43,340,671	Not applicable		3.94	%
Trading securities		1,886,894	Not applicable		(22.74	)%
Mortgage loans		20,465,956	22 years		27.85	%
Investment real estate		49,328,601	Not applicable		2.99	%
Notes receivable		8,105,234	Not applicable		9.72	%
Policy loans		10,894,364	Not applicable		6.61	%
Short-term investments		2,191,091	On demand		31.95	%
Total Investments	$	327,513,088			5.85	%

The Company, from time to time, acquires mortgage loans through participation agreements with FSNB. FSNB has been able to provide the Company with additional expertise and experience in underwriting commercial and residential mortgage loans, which provide more attractive yields than the traditional bond market. The Company is able to receive participations from FSNB for three primary reasons: 1) FSNB has already reached its maximum lending limit to a single borrower, but the borrower is still considered a suitable risk; 2) the interest rate on a particular loan may be fixed for a long period that is more suitable for UG given its asset-liability structure; and 3) FSNB's loan growth might at times outpace its deposit growth, resulting in FSNB participating such excess loan growth rather than turning customers away. For originated loans, the Company's Management is responsible for the final approval of such loans after evaluation. Before a new loan is issued, the applicant is subject to certain criteria set forth by Company Management to ensure quality control. These criteria include, but are not limited to, a credit report, personal financial information such as outstanding debt, sources of income, and personal equity. Once the loan is approved, the Company directly funds the loan to the borrower. The Company bears all risk of loss associated with the terms of the mortgage with the borrower.

The Company began purchasing discounted commercial mortgage loans in 2009. Management has extensive background and experience in the analysis and valuation of commercial real estate. The discounted loans are available through the FDIC's sale of assets of closed banks and from banks wanting to reduce their loan portfolios. The loans are available on a loan by loan bid process. Once a loan has been acquired, contact is made with the appropriate individuals to begin a dialog with a goal of determining the borrower's willingness to work together. There are generally three paths a discounted loan will take: the borrowers pay as required; a settlement is reached with the loan being paid off at a discounted value; or the loan is foreclosed.

During 2015 and 2014, the Company acquired approximately $10.4 million and $2.3 million in mortgage loans, respectively, including both regular participation mortgage loans as well as discounted mortgage loans.  FSNB services a majority of the mortgage loan portfolio of the Company.  The Company pays FSNB a .25% servicing fee on these loans and a one-time fee at loan origination of .50% of the original loan cost to cover costs incurred by FSNB relating to the processing and establishment of the loan.

Most mortgage loans are first position loans.  Loans issued are generally limited to no more than 80% of the appraised value of the property.

The Company has in place a monitoring system to provide Management with information regarding potential troubled loans. Letters are sent to each mortgagee when the loan becomes 30 days or more delinquent. Management is provided with a monthly listing of loans that are 60 days or more past due along with a brief description of what steps are being taken to resolve the delinquency. All loans 90 days or more past due are placed on a non-performing status and classified as delinquent loans. Quarterly, coinciding with external financial reporting, the Company reviews each delinquent loan and determines how each delinquent loan should be classified. Management believes the current internal controls surrounding the mortgage loan selection process provide a quality portfolio with minimal risk of negative financial impact.

Management has conservatively decided to place the loans in the discounted mortgage loan portfolio on a non-accrual status, due to the instability of the borrowers.

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 acquired 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.  The loan portfolio since purchase is performing very well with a majority of the loans currently paying.  Those not currently paying are being vigorously worked by Management.  The current discounted commercial mortgage loan portfolio has an average price of 39% 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. The mortgage loan reserve was $0 at December 31, 2015 and 2014.

The following table shows a distribution of the Company's mortgage loans and discounted mortgage loans by type as of December 31, 2015:

Mortgage Loans	Amount		% of Total
Commercial – all other	$	15,924,512		90	%
Residential – all other		1,845,418		10	%
Total	$	17,769,930		100	%

The following table shows a geographic distribution of the Company's mortgage loan portfolio including discounted mortgage loans and investment real estate as of December 31, 2015:

	Mortgage Loans	Real Estate
Arizona	12%	2%
California	0%	1%
Colorado	0%	3%
Florida	15%	26%
Georgia	0%	6%
Kentucky	23%	31%
Nevada	17%	0%
Ohio	1%	0%
South Carolina	0%	4%
Texas	0%	15%
Tennessee	16%	0%
West Virginia	16%	12%
Total	100%	100%

See Note 2 – Investments in the Notes to the Consolidated Financial Statements and Management's Discussion and Analysis for additional information regarding the Company's investments.

Competition

The insurance business is a highly competitive industry and there are a number of other companies, both stock and mutual, doing business in areas where the Company operates. Many of these competing insurers are larger, have more diversified and established lines of insurance coverage, have substantially greater financial resources and brand recognition, as well as a greater number of agents. Other significant competitive factors in the insurance industry include policyholder benefits, service to policyholders, and premium rates.

In recent years, the Company has not placed an emphasis on new business production. Costs associated with supporting new business can be significant. Current sales primarily represent sales to existing customers through additional insurance needs or conservation efforts. The Company currently encourages policy retention as opposed to new sales in an attempt to maintain or improve current persistency levels.

The Company performs administrative work as a third party administrator (TPA) for unaffiliated life insurance companies.  The Company intends to continue to pursue other TPA arrangements. The Company provides TPA services to insurance companies seeking business process outsourcing solutions.  Management believes the Company is positioned to generate additional revenues by utilizing the Company's current excess capacity and administrative services.

Regulation

Holding Company - States have enacted legislation requiring registration and periodic reporting by insurance companies domiciled within their respective jurisdictions that control or are controlled by other corporations so as to constitute a holding company system. Insurance holding company system statutes and regulations impose various limitations on investments in subsidiaries, and may require prior regulatory approval for material transactions between insurers and affiliates and for the payment of certain dividends and other distributions.

Insurance - Insurance companies are subject to regulation and supervision in the states in which they do business. Generally the state supervisory agencies have broad administrative powers relating to granting and revoking licenses to transact business, licensing agents, approving policy forms, regulating trade practices, approving certain premium rates, setting minimum reserve and loss ratio requirements, determining the form and content of required financial statements, and prescribing the type and amount of investments permitted. Insurance companies are also required to file detailed annual reports with supervisory agencies, and records of their business are subject to examination at any time. Under the rules of the National Association of Insurance Commissioners ("NAIC"), insurance companies are examined periodically by one or more of the supervisory agencies.

Risk-Based Capital - The NAIC requires a risk-based capital formula be applied to all life and health insurers. The risk-based capital formula is a threshold formula rather than a target capital formula. It is designed only to identify companies that require regulatory attention and is not to be used to rate or rank companies that are adequately capitalized. UTG's insurance subsidiary, UG, is more than adequately capitalized under the risk-based capital formula.

Guaranty Assessments – State guaranty laws provide for assessments from insurance companies to be placed into a fund which is used, in the event of failure or insolvency of an insurance company, to fulfill the obligations of that company to its policyholders. The amount which a company is assessed is determined according to the extent of these unsatisfied obligations in each state. Assessments are recoverable to a great extent as offsets against state premium taxes.

Personnel

At December 31, 2015, UTG and its subsidiaries had 42 full-time employees. UTG's operations are headquartered in Springfield, Illinois.

Item 1A. Risk Factors

As a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and Item 10(f)(1) of Regulation S-K, the Company has elected to comply with certain scaled disclosure reporting obligations, and therefore does not have to provide the information required by this item.

Item 1B. Unresolved Staff Comments

Not applicable.

Item 2. Properties

The Company owns an office complex in Springfield, Illinois, which houses the primary insurance operations. The office buildings in this complex contain 57,000 square feet of office and warehouse space.

Item 3. Legal Proceedings

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 these matters will not have a material adverse effect on the Company's results of operations or financial position.

Item 4. Mine Safety Disclosures

Not applicable.

PART II

Item 5. Market for Registrnat's Common Equity, Related Stockholders Matters and Issuer Purchaes of Equity Securities

The Registrant is a public company whose common stock is traded in the over-the-counter market. Over-the-counter quotations can be obtained using the UTGN stock symbol.

The following table shows the high and low closing prices for each quarterly period during the past two years, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions. The quotations below were acquired from the Yahoo Finance web site, which also provides quotes for over-the-counter traded securities such as UTG.

	2015		2014
Period	High	Low	High	Low
First quarter	14.25	13.05	12.50	11.25
Second quarter	15.99	13.50	12.50	10.55
Third quarter	19.00	14.80	14.13	12.25
Fourth quarter	17.00	14.36	14.50	13.55

UTG has not declared or paid any dividends on its common stock in the past two fiscal years, and has no current plans to pay dividends on its common stock as it intends to retain all earnings for investment in and growth of the Company's business.  See Note 9 – Shareholders' Equity in the Notes to the Consolidated Financial Statements for information regarding dividend restrictions, including applicable restrictions on the ability of the Company's life insurance subsidiary to pay dividends.

As of February 19, 2016 there were 6,324 record holders of UTG common stock.

Purchases of Equity Securities

The following table provides information with respect to purchases we made of our common stock during the three months ended December 31, 2015 and total repurchases:

	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Program		Maximum Number of Shares That May Yet Be Purchased Under the Program			Approximate Dollar Value That May Yet Be Purchased Under the Program
Oct. 1 through Oct. 31, 2015		80	$	16.63		80		N/	A	$	1,724,840
Nov. 1 through Nov. 30, 2015		42	$	16.50		42		N/	A	$	1,724,147
Dec. 1 through Dec. 31, 2015		1,949	$	14.82		1,949		N/	A	$	1,695,266
Total		2,071				2,071

The Board of Directors of UTG has authorized the repurchase in the open market or in privately negotiated transactions of UTG's common stock. At a meeting of the Board of Directors on June 3, 2015, the Board of Directors of UTG authorized the repurchase of up to an additional $1,000,000 of UTG's common stock, for a total repurchase of $8,000,000. Repurchased shares are available for future issuance for general corporate purposes. This program can be suspended or terminated at any time without further notice.  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 2015, the Company repurchased 25,919 shares through the stock repurchase program for $375,207. Through December 31, 2015, UTG has spent $6.5 million in the acquisition of 688,617 shares under this program.

On July 20, 2015 the Board of Directors of UTG also clarified and amended the terms on which UTG may repurchase shares in the program and gave Company Management broad authority to operate the program, including the discretion of whether to purchase shares and the ability to suspend or terminate the program. The program may be suspended or terminated at any time without further notice.

Stock Performance Graph

As a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and Item 10(f)(1) of Regulation S-K, the Company has elected to comply with certain scaled disclosure reporting obligations, and therefore does not have to provide the information required by this item.

Item 6. Selected Financial Data

As a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and Item 10(f)(1) of Regulation S-K, the Company has elected to comply with certain scaled disclosure reporting obligations, and therefore does not have to provide the information required by this item.

Item 7. 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") for the years ended December 31, 2015 and 2014. This discussion should be read in conjunction with the consolidated financial statements and notes thereto included elsewhere in this report.

Cautionary Statement Regarding Forward-Looking Statements

This report on Form 10-K 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, the acquisition of blocks of business and the administration and processing of life insurance business for other entities.

UTG has a strong philanthropic program. The Company generally allocates a portion of its earnings to be used for its philanthropic efforts primarily targeted to Christ-centered organizations or organizations that help the weak or poor. The Company also encourages its staff to be involved on a personal level through monetary giving, volunteerism and use of their talents to assist those less fortunate than themselves. Through these efforts, the Company hopes to make a positive difference in the local community, state, nation and world.

Critical Accounting Policies

We have identified the accounting policies below as critical to the understanding of our results of operations and our financial condition.  The application of these critical accounting policies in preparing our consolidated financial statements requires Management to use significant judgments and estimates concerning future results or other developments including the likelihood, timing or amount of one or more future transactions or amounts.  Actual results may differ from these estimates under different assumptions or conditions.  On an on-going basis, we evaluate our estimates, assumptions and judgments based upon historical experience and various other information that we believe to be reasonable under the circumstances.  For a detailed discussion of other significant accounting policies, see Note 1 – Summary of Significant Accounting Policies in the Notes to the Consolidated Financial Statements.

Future Policy Benefits – Because of the long-term nature of insurance contracts, the insurance company is liable for policy benefit payments that will be made in the future.  The liability for future policy benefits is determined by standard actuarial procedures common to the life insurance industry.  The accounting policies for determining this liability are disclosed in Note 1 – Summary of Significant Accounting Policies in the Notes to the Consolidated Financial Statements.

Cost of Insurance Acquired – The costs of acquiring blocks of insurance form other companies or through the acquisition of other companies are deferred and recorded as deferred acquisition costs. The deferred amounts are recorded as an asset and amortized to expense in a systematic manner as indicated in Note 1 – Summary of Significant Accounting Policies in the Notes to the Consolidated Financial Statements.

Valuation of Securities – The Company's investment portfolio consists of fixed maturities, equity securities, trading securities, mortgage loans and real estate to provide funding of future policy contractual obligations.  The Company's fixed maturities and equity securities are classified as available-for-sale.  Available-for-sale investments are carried at fair value with unrealized gains and losses reported in accumulated other comprehensive income (loss) in the Consolidated Balance Sheets.

The Company's trading securities are carried at fair value with unrealized gains and losses reported in income in the Consolidated Statements of Operations. Fair value is the price that the Company would expect to receive upon sale of the asset in an orderly transaction.

Mortgage loans on real estate are carried at their unpaid principal balances, adjusted for amortization of premium or discount and valuation allowances. Valuation allowances are established for impaired loans when it is probable that contractual principal and interest will not be collected. A portion of the mortgage loan balance consists of discounted mortgage loans that were purchased at deep discounts through an auction process led by the Federal Government. In general, the discounted mortgage 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 mortgage loans at its original purchase price adjusted for any principal receipts received.

Investment real estate held for sale is reported at the lower of cost or fair value less cost to sell. Expenses to maintain the property are expensed as incurred.

While the available-for-sale securities are generally expected to be held to maturity, they are classified as available-for-sale and are sold periodically to manage risk. Although a majority of the investment portfolio is classified as available-for-sale, the Company has the ability and intent to hold the securities until maturity. See Note 2 – Investments in the Notes to the Consolidated Financial Statements for detailed disclosures regarding the Company's investment portfolio.

Impairment of Investments – The Company continually monitors the investment portfolio for investments that have become impaired in value, where fair value has declined below carrying value.  While the value of the investments in the Company's portfolio continuously fluctuate due to market conditions, an other-than-temporary impairment charge is recorded only when a security has experienced a decline in fair market value which is deemed to be other than temporary.  The policies and procedures the Company uses to evaluate and account for impairments of investments are disclosed in Note 1 – Summary of Significant Accounting Policies and Note 2 – Investments in the Notes to the Consolidated Financial Statements. The Company makes every effort to appropriately assess the status and value of the securities with the information available regarding an other-than-temporary impairment. However, it is difficult to predict the future prospects of a distressed or impaired security.

Deferred Income Taxes – The provision for deferred income taxes is based on the asset and liability method of accounting for income taxes. Under this method, deferred income taxes are recognized by applying enacted statutory tax rates to temporary differences between amounts reported in the Consolidated Financial Statements and the tax basis of existing assets and liabilities. A valuation allowance is recognized for the portion of deferred tax assets that, in Management's judgment, is not likely to be realized. The effect on deferred income taxes of a change in tax rates or laws is recognized in income tax expense in the period that includes the enactment date.  Refer to Note 1 – Summary of Significant Accounting Policies in the Notes to the Consolidated Financial Statements for detailed information regarding the Company's significant accounting policies.

Results of Operations

On a consolidated basis, the Company had net income attributable to common shareholders of $900,000 and $7 million in 2015 and 2014, respectively.  In 2015, income before income taxes was $273,000 compared to $11.1 million in 2014. Total revenue was $28.8 million in 2015 and $43.6 million in 2014.

One-time events, primarily reflected in realized gains, comprise a substantial portion of the net income and revenue reported by the Company during 2015 and 2014.  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.  Future earnings will be significantly negatively impacted should earnings from these one-time items not be realizable in a future period.  While Management believes there remain additional investments with such one-time earnings, when or if realized remains uncertain.

Total benefits and other expenses paid in 2015 were $28.5 million compared to $32.5 million in 2014.

Revenues

Premiums and policy fee revenues, net of reinsurance premiums and policy fees, decreased approximately 5% when comparing 2015 to 2014.  The Company writes very little new business. Unless the Company acquires a new company or a block of in-force business, Management expects premium revenue to continue to decline on the existing block of business at a rate consistent with prior experience. The Company's average persistency rate for all policies in-force for 2015 and 2014 was approximately 96.2% and 96.6%, respectively.  Persistency is a measure of insurance in-force retained in relation to the previous year.

The following table reflects net investment income of the Company for the years ended December 31:

	2015			2014
Fixed maturities	$	8,559,938		$	8,225,640
Equity securities		1,708,786			3,255,611
Trading securities		(429,161	)		(476,578	)
Mortgage loans		5,700,492			4,592,853
Real estate		1,474,726			8,355,153
Notes receivable		787,658			340,000
Policy loans		720,544			760,715
Cash and cash equivalents		681			505
Short-term		699,357			70,578
Total consolidated investment income		19,223,021			25,124,477
Investment expenses		(3,663,086	)		(8,774,758	)
Consolidated net investment income	$	15,559,935		$	16,349,719

The Company's gross investment income and net investment income were down approximately 23% and 5%, respectively, when comparing the current and prior year results. Investment expenses were down approximately 58% when comparing the current and prior year results. The variance in investment income, when comparing the current and prior year results, is mainly attributable to fluctuations in the earnings of the equity securities, real estate and short term investment portfolios.

During the current year, the Company reported income of $1.7 million from equity securities portfolio, a decrease of 48% in comparison to the prior year. During 2014, the interest rate on one of the Company's preferred stocks increased substantially, according to the terms of the contractual agreement, causing the increase in income reported in the equity securities portfolio. This specific preferred stock was redeemed in subsequent quarters; therefore, no longer providing the high interest rate yield.

The Company's real estate investment portfolio produced income of approximately $1.5 million and $8.4 million during 2015 and 2014, respectively. During 2014, one of the Company's consolidated subsidiaries sold all of the real estate it owned. Historically, this real estate generated annual rental income of approximately $6.7 million. As a result of the sale, the Company no longer recognizes rental income from this real estate.

Income from the short term investment portfolio increased approximately $630,000 in comparison to the prior year. During 2016, the Company financed a short-term note receivable. The note was fully repaid during the fourth quarter of 2015 and the Company recognized income of approximately $443,000 at the time of payoff.

The Company's investment expenses decreased approximately 58% or $5 million when comparing the 2015 and 2014 results. Investment expenses are expected to vary from year to year depending on the resources utilized by the Company to maintain and work the investment portfolio.  As mentioned above, during 2014, one of the Company's consolidated subsidiaries sold the real estate it owned. This real estate generated investment expenses related to its operations of approximately $4.7 million during 2014. As a result of the sale, the Company did not incur similar expenses during 2015.

The following table reflects net realized investment gains (losses) for the years ended December 31:

	2015			2014
Fixed maturities available for sale	$	1,248,240		$	1,278,743
Equity securities		780,396			2,645,216
Real estate		5,968,558			13,297,119
Equity securities – OTTI		(3,515,700	)		(126,959	)
Real estate – OTTI		(54,901	)		(35,946	)
Consolidated net realized investment gains	$	4,426,593		$	17,058,173

The Company's net realized investment gains were approximately $12.6 million lower when comparing the current and prior year results and is primarily attributable to the Company recognizing fewer gains in the equity and real estate investments portfolios during the current year. Furthermore, the Company recognized significantly more other than temporary impairments (OTTI) in the current year as compared to the prior year.

The gain reported in the equity securities portfolio during 2015 and 2014 is mainly the result of the redemption of a certain preferred stock owned by the Company. During 2014, the Company recognized gains totaling approximately $1.9 million from the redemption of a portion of this preferred stock. In 2015, the remaining portion of this preferred stock was redeemed, producing a gain of approximately $972,000.

The 2015 realized gains from real estate are mainly attributable to the sale of three real estate parcels, which produced net gains of approximately $5 million.  The Company reported net gains of approximately $13.3 million during 2014 from the sale of real estate.  During the fourth quarter of 2014, a majority owned subsidiary of UG, HPG Acquisitions, LLC ("HPG"), sold all of the real estate it owned in Midland, Texas and recognized a gain of approximately $10.1 million.  The sale of this real estate is the main reason for the fluctuation in the non-controlling interest balance reported on the Consolidated Statements of Operations. During the third quarter of 2014, the Company recognized a gain of approximately $3.1 million from the sale of real estate held by one of UG's wholly owned subsidiaries.  Gains from the sale of real estate are the result of one-time events and are expected to vary from year to year.

During 2015 and 2014, realized gains were offset by other-than-temporary impairments of approximately $3.6 million and $163,000, respectively. The other-than-temporary impairments were taken as a result of Management's assessment and consideration of the length of time the securities have remained in an unrealized loss position and as a result of management's analysis and determination of value. The investments were written down to better reflect their current expected fair value.

Other Income

Other income, which mainly consists of fees charged for third party administration ("TPA") services, decreased approximately $1 million when comparing the 2015 and 2014 results reported by the Company. The Company receives monthly fees based on policy in-force counts and certain other activity indicators, such as number of premium collections performed, or services performed.  The Company provides TPA services to insurance companies seeking business process outsourcing solutions.

During the fourth quarter of 2014, Management did not renew its largest third party administration contract as a result of thin profit margins associated with this contract coupled with its labor intensity. The non-renewal of this contract did not have a material financial impact as the Company has recognized operating expense reductions similar to the lost revenues.

In summary, the Company's basis for future revenue growth is expected to come from the following primary sources: conservation of business currently in-force, the maximization of investment earnings and the acquisition of other companies or policy blocks in the life insurance business. Management has placed a significant emphasis on the development of these revenue sources to enhance these opportunities.

Expenses

The Company reported total benefits and other expenses of $28.5 million and $32.5 million for the twelve-month period ended December 31, 2015 and 2014, respectively. Benefits, claims and settlement expenses represented approximately 66% and 60% of the Company's total expenses for 2015 and 2014, respectively.  The other major expense category of the Company is operating expenses, which represented 31% and 33% of the Company's total expenses for 2015 and 2014, respectively.

Benefits, claims and settlement expenses, net of reinsurance benefits, decreased approximately 4% in 2015 compared to 2014.  The decrease primarily relates to changes in the Company's death claim experience. Policy claims vary from year to year and therefore, fluctuations in mortality are to be expected and are not considered unusual by Management.

In early 2013, the Company began a proactive analysis of its in-force business to try to reconnect with lost customers and verify its customers are not deceased. In some instances, the Company found that the customer was indeed deceased, but no notification or claim was presented to the Company. During 2014, the Company paid approximately $1.2 million in death claim benefits as a result of this action. This project was completed during the second quarter of 2014 and contributed to higher benefit expenses in 2014, compared to 2015.

Changes in policyholder reserves, or future policy benefits, also impact this line item.  Reserves are calculated on an individual policy basis and generally increase over the life of the policy as a result of additional premium payments and acknowledgement of increased risk as the insured continues to age.

The short-term impact of policy surrenders is negligible since a reserve for future policy benefits payable is held which is, at a minimum, equal to and generally greater than the cash surrender value of a policy. The benefit of fewer policy surrenders is primarily received over a longer time period through the retention of the Company's asset base.

Operating expenses decreased approximately 17% in 2015 compared to 2014.  When analyzing 2014 and 2015 operating expenses, expenses were down slightly in the majority of the categories, and significantly in two categories, information technology and charitable contributions. As previously mentioned in the Results of Operations – Other Income section of the MD&A, the Company did not renew its largest third party administration contract. The non-renewal of this contract allowed the Company to recognize cost saving measures therefore reducing operating expenses incurred by the Company during 2015.

Information technology expenses decreased approximately 29% compared to the prior year. Information technology expenses were higher in the prior year as a result of additional expenses incurred in relation to the conversion to a new administrative system. Following an extensive analysis of administrative systems available in the market place, early in 2014 the Company determined it would change its administrative system. The Company will be fully converted to the new system during the first quarter of 2016. Management believes this system change will better position the Company for the future by providing a more modern and flexible operating system while reducing ongoing operating costs.

Charitable contributions decreased approximately 63% when comparing current and prior year expenditures. As mentioned above in the Overview section of the Management Discussion and Analysis, UTG has a strong philanthropic program. The Company generally allocates a portion of its earnings to be used for its philanthropic efforts primarily targeted to Christ-centered organizations or organizations that help the weak or poor. Charitable contributions made by the Company are expected to vary from year to year depending on the earnings of the Company.

Net amortization of cost of insurance acquired decreased approximately 8% when comparing current and prior year activity. 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.

Management has been working on a plan and has made the determination it is in the Company's best long term interest to relocate its main operations from Springfield, Illinois to Stanford, Kentucky. The Company's majority shareholder, Jess Correll, headquarters his other operating entities in Stanford, Kentucky. Management believes this move will provide the Company with significant synergies, improve efficiencies and reduce overall operating expenses. The relocation is anticipated to occur during the third quarter of 2016. Significant time and planning has been put into this relocation to help ensure as smooth a transition as possible.

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

Financial Condition

Investment Information

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 they are permitted to make, and the amount of funds that may be used for any one type of investment.

The following table reflects, by investment category, the investments held by the Company as of December 31:

	2015		As a % of Total Investments			As a % of Total Assets
Fixed maturities	$	185,119,097		58	%		49	%
Equity securities		45,685,340		15	%		12	%
Mortgage loans		17,769,930		6	%		5	%
Real estate		47,650,102		15	%		13	%
Notes receivable		10,597,907		3	%		3	%
Policy loans		10,684,244		3	%		3	%
Total investments	$	317,506,620		100	%		85	%

	2014		As a % of Total Investments			As a % of Total Assets
Fixed maturities	$	197,481,456		59	%		49	%
Equity securities		40,996,002		12	%		10	%
Trading securities		3,826,250		1	%		1	%
Mortgage loans		23,161,982		7	%		6	%
Real estate		51,007,101		15	%		13	%
Notes receivable		5,612,560		2	%		1	%
Policy loans		11,104,485		3	%		3	%
Short-term		4,382,181		1	%		1	%
Total investments	$	337,572,017		100	%		84	%

The Company's investments are generally managed to match related insurance and policyholder liabilities. The comparison of investment return with insurance or investment product crediting rates establishes an interest spread. Interest crediting rates on adjustable rate policies have been reduced to their guaranteed minimum rates, and as such, cannot be lowered any further. Policy interest crediting rate changes and expense load changes become effective on an individual policy basis on the next policy anniversary. Therefore, it takes a full year from the time the change was determined for the full impact of such change to be realized. If interest rates decline in the future, the Company will not be able to lower rates and both net investment income and net income will be impacted negatively.

The Company's total investments represented 85% and 84% of the Company's total assets as of December 31, 2015 and 2014, respectively. Fixed maturities consistently represented a substantial portion, 49%, of the total investments during 2014 and 2015.  The overall investment mix, as percentage of total investments, remained fairly consistent when comparing the investments held as of December 31, 2015 and 2014.

As of December 31, 2015, 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 available for sale".  Investments available for sale are carried at market, with changes in market value charged directly to shareholders' equity.  Changes in the market value of available for sale securities resulted in net unrealized losses of approximately $(7.2) million during 2015 and net unrealized gains of approximately $4.2 million during 2014. The variance in the net unrealized gains and losses is the result of normal market fluctuations mainly related to higher interest rates.

During 2015, the trading securities asset balance decreased while the equity securities balance increased. As disclosed in Note 2 - Investment of the Consolidated Financial Statements, as of June 30, 2015, the Company reclassified its remaining exchange-traded equity trading security to the available for sale category. The fair value of the security at the time of the reclassification was $3,224,000.  Trading securities are purchased and held primarily for purposes of selling them in the near term and reflect active and frequent buying and selling. Management analyzed the recent buying and selling activity related to the exchange-traded equity and deems the available for sale category to better reflect Management's intent for this security going forward. Through June 30, 2015, unrealized gains and losses from this exchange-traded equity were recorded as a component of earnings. Future unrealized gains/losses will be reported as a component of comprehensive income.

Management continues to view the Company's investment portfolio with utmost priority. Significant time has been spent internally researching the Company's risk and communicating with outside investment advisors about the current investment environment and ways to ensure preservation of capital and mitigate losses. Management has put extensive efforts into evaluating the investment holdings. Additionally, members of the Company's Board of Directors and investment committee have been solicited for advice and provided with information. Management reviews the Company's entire portfolio on a security level basis to be sure all understand our holdings, potential risks and underlying credit supporting the investments. Management intends to continue its close monitoring of its bond holdings and other investments for additional deterioration or market condition changes. Future events may result in Management's determination that certain current investment holdings may need to be sold which could result in gains or losses in future periods. Such future events could also result in other than temporary declines in value that could result in future period impairment losses.

There are a number of significant risks and uncertainties inherent in the process of monitoring impairments and determining if impairment is other-than-temporary. These risks and uncertainties related to Management's assessment of other-than-temporary declines in value include but are not limited to: the risk that Company's assessment of an issuer's ability to meet all of its contractual obligations will change based on changes in the credit characteristics of that issuer; the risk that the economic outlook will be worse than expected or have more of an impact on the issuer than anticipated; the risk that fraudulent information could be provided to the Company's investment professionals who determine the fair value estimates.

Liquidity

Liquidity provides the Company with the ability to meet on demand the cash commitments required by its business operations and financial obligations.  The Company's liquidity is primarily derived from a portfolio of marketable securities and line of credit facilities.  The Company has two principal needs for cash – the insurance company's contractual obligations to policyholders and the payment of operating expenses.

Parent Company Liquidity

UTG is a holding company that has no day-to-day operations of its own.  Cash flows from UTG's insurance subsidiary, UG, are used to pay costs associated with maintaining the Company in good standing with states in which it does business and purchasing outstanding shares of UTG stock.  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.  As of December 31, 2015 and 2014, substantially all of the consolidated shareholders' equity represents net assets of its subsidiaries.  In 2015, the Parent company received $4 million in dividends from its insurance subsidiary and $4.8 million in 2014. Certain restrictions exist on the payment of dividends from the insurance subsidiary to the Parent company.  For further information regarding the restrictions on the payment of dividends by the insurance subsidiary, see Note 9 – Shareholders' Equity in the Notes to the Consolidated Financial Statements. Although these restrictions exist, dividend availability from the insurance subsidiary has historically been sufficient to meet the cash flow needs of the Parent company.

Insurance Subsidiary Liquidity

Sources of cash flows for the insurance subsidiary primarily consist of premium and investment income. Cash outflows from operations include policy benefit payments, commissions, administrative expenses, taxes and dividends to the Parent company.

Short-Term Borrowings

An additional source of liquidity to the Parent company and its subsidiaries is the line of credit facilities extended to them. As of December 31, 2015, the Company and its subsidiaries had available $18 million in line of credit facilities. As of December 31, 2014, the Company and its subsidiaries had available $8 million in line of credit facilities.  For additional information regarding the line of credit facilities, see Note 7 – Credit Arrangements in the Notes to the Consolidated Financial Statements.

The Company expects to have readily available funds for the foreseeable future to conduct its operations and to maintain target capital ratios in the insurance subsidiary through internally generated cash flow and the credit facilities. In the unlikely event that more liquidity is needed, the Company could generate additional funds through such sources as a short-term credit facility and intercompany borrowing.

Consolidated Liquidity

Cash used in operating activities was approximately $11.1 million and $13.6 million in 2015 and 2014, respectively. Sources of operating cash flows of the Company, as with most insurance entities, is comprised primarily of premiums received on life insurance products and income earned on investments. Uses of operating cash flows consist primarily of payments of benefits to policyholders and beneficiaries and operating expenses. The Company has not marketed any significant new products for several years. As such, premium revenues continue to decline. Management anticipates future cash flows from operations to remain similar to historic trends.

During 2015, the Company's investing activities provided net cash of approximately $13.6 million.  During 2014, the Company's investing activities provided net cash of approximately $34.3 million.  Proceeds from investments sold decreased approximately 39% or $50 million when comparing 2015 to 2014. Investment purchases decreased approximately 30% or $27.3million. The net cash provided by investing activities is expected to vary from year to year depending on market conditions and management's ability to find and negotiate favorable investment contracts.

Net cash used in financing activities was approximately $(4.6) million and $(26.5) million during 2015 and 2014, respectively. During 2015, the Company made principal payments on its outstanding debt of approximately $4.4 million and as of December 31, 2015 the Company had no debt outstanding with third parties. During 2014, the Company made principal payments on its outstanding debt of approximately $16.3 million. As a result of the 2014 principal payments made, UTG, as well as one of its subsidiaries, HPG Acquisitions, LLC, fully repaid their outstanding debt.

The Company had cash and cash equivalents of approximately $11.8 million and $14 million as of December 31, 2015 and 2014, respectively. The Company has a portfolio of marketable fixed and equity securities that are available for sale, if an unexpected event were to occur. These securities had a fair value of approximately $231 million and $238 million at December 31, 2015 and 2014, respectively. However, the strong cash flows from investing activities, investment maturities and the availability of the line of credit facilities make it unlikely that the Company would need to sell securities for liquidity purposes.  See Note 2 – Investments in the Notes to the Consolidated Financial Statements for detailed disclosures regarding the Company's investment portfolio.

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

Capital Resources

The Company's capital structure consists of short-term debt, long-term debt and shareholders' equity. A complete analysis and description of the short-term and long-term debt issues outstanding as of December 31, 2015 and 2014 are presented in Note 7 – Credit Arrangements in the Notes to the Consolidated Financial Statements.

The Company had no outstanding debt as of December 31, 2015 and $4.4 million of outstanding debt as of December 31, 2014.  The 2014 outstanding debt belonged to   UTG Avalon, LLC, a wholly owned subsidiary of UG. See Note 7 – Credit Arrangements in the Notes to the Consolidated Financial Statements for detailed disclosures regarding the Company's notes payable.

The NAIC's risk-based capital requirements require insurance companies to calculate and report information under a risk-based capital formula.  The risk-based capital (RBC) formula measures the adequacy of statutory capital and surplus in relation to investment and insurance risks such as asset quality, mortality and morbidity, asset and liability matching and other business factors.  The RBC formula is used by state insurance regulators as an early warning tool to identify, for the purpose of initiating regulatory action, insurance companies that potentially are inadequately capitalized.

At December 31, 2015, UG has a ratio of approximately 4.74, which is 474% of the authorized control level. Accordingly, the Company meets the RBC requirements.

The Board of Directors of UTG has authorized the repurchase in the open market or in privately negotiated transactions of UTG's common stock. At a meeting of the Board of Directors on June 3, 2015, the Board of Directors of UTG authorized the repurchase of up to an additional $1,000,000 of UTG's common stock, for a total repurchase of $8,000,000. Repurchased shares are available for future issuance for general corporate purposes. This program can be suspended or terminated at any time without further notice.  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 2015, the Company repurchased 25,919 shares through the stock repurchase program for $375,207. Through December 31, 2015, UTG has spent $6.5 million in the acquisition of 688,617 shares under this program.

On July 20, 2015 the Board of Directors of UTG also clarified and amended the terms on which UTG may repurchase shares in the program and gave Company Management broad authority to operate the program, including the discretion of whether to purchase shares and the ability to suspend or terminate the program. The program may be suspended or terminated at any time without further notice.

Shareholders' equity was approximately $77 million and $83.6 million as of December 31, 2015 and 2014, respectively. Total shareholders' equity decreased approximately 8% in 2015 compared to 2014.  The decrease is primarily attributable to the change in accumulated other comprehensive income (loss). As of December 31, 2015, the Company reported an accumulated other comprehensive loss of approximately $(1.2) million and accumulated other comprehensive income of approximately $6.9 million as of December 31, 2014. The change in accumulated other comprehensive income (loss) is mainly attributable to the net unrealized holding losses of approximately $(7.2) million during 2015 compared to net unrealized holding gains of $4.2 million reported during 2014. As previously discussed in the above in the Financial Condition – Investment Information section of the MD&A, the variance in the net unrealized gains and losses is the result of normal market fluctuations mainly related to higher interest rates.

The Company's investments are predominantly in fixed maturity investments such as bonds, which provide sufficient return to cover future obligations. The Company carries all of its fixed maturity holdings as available for sale, which are reported in the Consolidated Financial Statements at their fair value.

New Accounting Pronouncements

See Note 1 – Summary of Significant Account Policies in the Notes to the Consolidated Financial Statements for information regarding new accounting pronouncements.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements, financing activities or other relationships with unconsolidated entities or other persons.

Contractual Obligations

As a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and Item 10(f)(1) of Regulation S-K, the Company has elected to comply with certain scaled disclosure reporting obligations, and therefore does not have to provide the information required by this item.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

As a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and Item 10(f)(1) of Regulation S-K, the Company has elected to comply with certain scaled disclosure reporting obligations, and therefore does not have to provide the information required by this item.

Item 8. Financial Statements and Supplementary Data

Index to Financial Statements

	Page No.
UTG, Inc. and Consolidated Subsidiaries
Report of Independent Registered Public Accounting Firm	21
Consolidated Balance Sheets	22
Consolidated Statements of Operations	23
Consolidated Statements of Comprehensive Income	24
Consolidated Statements of Shareholders' Equity	25
Consolidated Statements of Cash Flows	26
Notes to Consolidated Financial Statements	27

Report of Independent Registered Public Accounting Firm

To the Board of Directors and

Shareholders of UTG, Inc. and Subsidiaries

Springfield, Illinois

We have audited the accompanying consolidated balance sheets of UTG, Inc. and subsidiaries (a Delaware corporation, the "Company") as of December 31, 2015 and 2014, and the related consolidated statements of operations, comprehensive income (loss), shareholders' equity, and cash flows for each of the years in the two-year period ended December 31, 2015. The Company's management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of UTG, Inc. and subsidiaries as of December 31, 2015 and 2014, and the consolidated results of their operations and their consolidated cash flows for each of the years in the two-year period ended December 31, 2015, in conformity with accounting principles generally accepted in the United States of America.

/s/ Brown Smith Wallace, LLC

St. Louis, Missouri

March 25, 2016

UTG, Inc.

Consolidated Balance Sheets

As of December 31, 2015 and 2014

ASSETS
	2015			2014
Investments:
Investments available for sale:
Fixed maturities, at fair value (amortized cost $188,647,671 and $188,634,364)	$	185,119,097		$	197,481,456
Equity securities, at fair value (cost $43,954,737 and $39,275,638)		45,685,340			40,996,002
Trading securities, at fair value (cost $0 and $5,179,850)		0			3,826,250
Mortgage loans on real estate at amortized cost		17,769,930			23,161,982
Investment real estate		47,650,102			51,007,101
Notes receivable		10,597,907			5,612,560
Policy loans		10,684,244			11,104,485
Short-term investments		0			4,382,181
Total investments		317,506,620			337,572,017
Cash and cash equivalents		11,822,615			13,977,443
Accrued investment income		2,821,338			2,662,865
Reinsurance receivables:
Future policy benefits		27,462,830			27,906,905
Policy claims and other benefits		3,553,978			3,788,294
Cost of insurance acquired		8,140,379			9,047,984
Property and equipment, net of accumulated depreciation		2,016,611			2,475,829
Income taxes recoverable		619,043			0
Other assets		3,283,681			2,468,901
Total assets	$	377,227,095		$	399,900,238
LIABILITIES AND SHAREHOLDERS' EQUITY
Policy liabilities and accruals:
Future policy benefits	$	269,119,859		$	275,044,909
Policy claims and benefits payable		3,759,565			3,208,324
Other policyholder funds		457,774			341,248
Dividend and endowment accumulations		14,233,644			14,239,054
Income taxes payable		0			1,933,243
Deferred income taxes		3,405,467			9,413,794
Notes payable		0			4,400,000
Trading securities, at fair value (proceeds $108,881 and $464,215)		28,609			23,853
Other liabilities		9,234,675			7,723,213
Total liabilities		300,239,593			316,327,638
Shareholders' equity:
Common stock - no par value, stated value $0.001 per share. Authorized 7,000,000 shares - 3,699,447 and 3,706,780 shares issued and outstanding		3,699			3,706
Additional paid-in capital		43,002,670			43,122,944
Retained earnings		33,062,282			32,145,662
Accumulated other comprehensive income		(1,183,552	)		6,853,974
Total UTG shareholders' equity		74,885,099			82,126,286
Noncontrolling interest		2,102,403			1,446,314
Total shareholders' equity		76,987,502			83,572,600
Total liabilities and shareholders' equity	$	377,227,095		$	399,900,238

See accompaning notes.

UTG, Inc.

Consolidated Statements of Operations

As of December 31, 2015 and 2014

	2015			2014
Revenues:
Premiums and policy fees	$	11,164,857		$	11,667,248
Reinsurance premiums and policy fees		(3,090,503	)		(3,126,914	)
Net investment income		15,559,935			16,349,719
Other income		707,069			1,676,602
Revenues before realized gains (losses)		24,341,358			26,566,655
Realized investment gains (losses), net:
Other-than-temporary impairments		(3,570,601	)		(162,905	)
Other realized investment gains, net		7,997,194			17,221,078
Total realized investment gains, net		4,426,593			17,058,173
Total revenues		28,767,951			43,624,828
Benefits and other expenses:
Benefits, claims and settlement expenses:
Life		20,245,920			21,404,297
Ceded Reinsurance benefits and claims		(2,919,064	)		(2,855,202	)
Annuity		996,485			597,792
Dividends to policyholders		446,567			479,158
Commissions and amortization of deferred policy acquisition costs		(168,533	)		432,695
Amortization of cost of insurance acquired		907,605			985,650
Operating expenses		8,916,771			10,776,690
Interest expense		68,876			677,079
Total benefits and other expenses		28,494,627			32,498,159
Income before income taxes		273,324			11,126,669
Income tax benefit (expense)		932,715			(1,082,927	)
Net income		1,206,039			10,043,742
Net income attributable to noncontrolling interest		(289,419	)		(3,067,726	)
Net income attributable to common shareholders':	$	916,620		$	6,976,016
Amounts attributable to common shareholders':
Basic income per share	$	0.25		$	1.86
Diluted income per share	$	0.25		$	1.86
Basic weighted average shares outstanding		3,704,322			3,750,239
Diluted weighted average shares outstanding		3,704,322			3,750,239

See accompanying notes.

UTG, Inc.

Consolidated Statements of Comprehensive Income

For the Years Ended December 31, 2015 and 2014

	2015			2014
Net Income	$	1,206,039		$	10,043,742
Other comprehensive income (loss):
Unrealized holding gains (losses) arising during period, pre-tax		(11,117,183	)		6,501,163
Tax (expense) benefit on unrealized holding gains (losses) arising during the period		3,891,014			(2,275,407	)
Unrealized holding gains (losses) arising during period, net of tax		(7,226,169	)		4,225,756
Less reclassification adjustment for gains included in net income		(1,248,241	)		(1,278,743	)
Tax expense for gains included in net income		436,884			447,560
Reclassification adjustment for gains included in net income, net of tax		(811,357	)		(831,183	)
Subtotal: Other comprehensive income (loss), net of tax		(8,037,526	)		3,394,573
Comprehensive income (loss)		(6,831,487	)		13,438,315
Less comprehensive income attributable to no controlling interest		(289,419	)		(3,067,726	)
Comprehensive income (loss) attributable to UTG, Inc.	$	(7,120,906	)	$	10,370,589

See accompanying notes.

UTG, Inc.

Consolidated Statements of Shareholders' Equity

Year ended December 31, 2015	Common Stock			Additional Paid-In Capital			Retained Earnings		Accumulated Other Comprehensive Income (Loss)			Noncontrolling Interest			Total Shareholders' Equity
Balance at January 1, 2015	$	3,706		$	43,122,944		$	32,145,662	$	6,853,974		$	1,446,314		$	83,572,600
Common stock issued during year		19			254,908			0		0			0			254,927
Treasury shares acquired		(26	)		(375,182	)		0		0			0			(375,208	)
Net income attributable to common shareholders		0			0			916,620		0			0			916,620
Unrealized holding loss on securities net of noncontrolling interest and reclassification adjustment and taxes		0			0			0		(8,037,526	)		0			(8,037,526	)
Contributions		0			0			0		0			1,124,217			1,124,217
Distributions		0			0			0		0			(757,547	)		(757,547	)
Gain attributable to noncontrolling interest		0			0			0		0			289,419			289,419
Balance at December 31, 2015	$	3,699		$	43,002,670		$	33,062,282	$	(1,183,552	)	$	2,102,403		$	76,987,502
Year ended December 31, 2014		Common Stock			Additional Paid-In Capital			Retained Earnings		Accumulated Other Comprehensive Income (Loss)			Noncontrolling Interest			Total Shareholders' Equity
Balance at January 1, 2014	$	3,776		$	44,050,778		$	25,169,646	$	3,459,401		$	5,183,840		$	77,867,441
Common stock issued during year		4			68,943			0		0			0			68,947
Treasury shares acquired		(74	)		(996,777	)		0		0			0			(996,851	)
Net income attributable to common shareholders		0			0			6,976,016		0			0			6,976,016
Unrealized holding loss on securities net of noncontrolling interest and reclassification adjustment and taxes		0			0			0		3,394,573			0			3,394,573
Contributions		0			0			0		0			185,689			185,689
Distributions		0			0			0		0			(6,990,941	)		(6,990,941	)
Gain attributable to noncontrolling interest		0			0			0		0			3,067,726			3,067,726
Balance at December 31, 2014	$	3,706		$	43,122,944		$	32,145,662	$	6,853,974		$	1,446,314		$	83,572,600

See accompanying notes.

UTG, INC.

Consolidated Statements of Cash Flows

As of December 31, 2015 and 2014

	2015			2014
Cash flows from operating activities:
Net income attributable to common shares	$	916,620		$	6,976,016
Adjustments to reconcile net income to net cash used in operating activities
resulting from the sales and purchases of subsidiaries:
Amortization (accretion) of investments		(2,753,269	)		(2,161,508	)
Realized investment gains, net		(4,426,593	)		(17,058,173	)
Unrealized trading (gains) losses included in income		945,128			722,573
Realized trading (gains) losses included in income		0			143,957
Amortization of deferred policy acquisition costs		0			369,786
Amortization of cost of insurance acquired		907,605			985,650
Depreciation		814,336			1,303,829
Net income attributable to noncontrolling interest		289,419			3,067,726
Charges for mortality and administration of universal life and annuity products		(6,640,391	)		(6,651,876	)
Interest credited to account balances		4,835,215			4,985,077
Change in accrued investment income		(158,473	)		(229,926	)
Change in reinsurance receivables		678,391			998,863
Change in policy liabilities and accruals		(3,132,596	)		(5,123,893	)
Change in income taxes receivable (payable)		(2,552,286	)		3,229,286
Change in other assets and liabilities, net		(871,642	)		(5,197,626	)
Net cash used in operating activities		(11,148,536	)		(13,640,239	)
Cash flows from investing activities:
Proceeds from investments sold and matured:
Fixed maturities available for sale		22,484,522			44,228,405
Equity securities available for sale		8,087,827			14,686,816
Trading securities		125,774			1,992,704
Mortgage loans		20,140,224			9,040,925
Real estate		19,829,665			53,674,168
Policy loans		3,102,284			3,322,613
Short-term investments		4,482,329			960,148
Total proceeds from investments sold and matured		78,252,625			127,905,779
Cost of investments acquired:
Fixed maturities available for sale		(21,733,834	)		(60,986,549	)
Equity securities available for sale		(12,278,232	)		(12,963,380	)
Trading securities		(463,895	)		(371,388	)
Mortgage loans		(13,774,698	)		(2,348,890	)
Real estate		(8,650,084	)		(7,424,311	)
Notes receivable		(4,985,347	)		0
Policy loans		(2,682,043	)		(2,566,138	)
Short-term investments		(100,149	)		(5,342,329	)
Total cost of investments acquired		(64,668,282	)		(92,002,985	)
Purchase of property and equipment		0			(1,600,000	)
Net cash provided by investing activities		13,584,343			34,302,794
Cash flows from financing activities:
Policyholder contract deposits		5,189,311			5,304,502
Policyholder contract withdrawals		(5,514,232	)		(6,323,472	)
Proceeds from notes payable/line of credit		0			1,600,000
Payments of principal on notes payable/line of credit		(4,400,000	)		(16,297,534	)
Purchase of treasury stock		(120,281	)		(927,904	)
Non controlling contributions/(distributions) of consolidated subsidiary		254,567			(6,833,748	)
Sale of block of business		0			(3,045,574	)
Net cash used in financing activities		(4,590,635	)		(26,523,730	)
Net decrease in cash and cash equivalents		(2,154,828	)		(5,861,175	)
Cash and cash equivalents at beginning of year		13,977,443			19,838,618
Cash and cash equivalents at end of year	$	11,822,615		$	13,977,443

See accompanying notes.

UTG, Inc.

Notes to Consolidated Financial Statements

Note 1 – Summary of Significant Accounting Policies

Business – UTG, Inc. is an insurance holding company. The Company's dominant business is individual life insurance, which includes the servicing of existing insurance in-force and the acquisition of other companies in the life insurance business. UTG and its subsidiaries are collectively referred to as the "Company".

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 100.00 %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 December 31, 2015, Mr. Correll owns or controls directly and indirectly approximately 57.61 % of UTG's outstanding stock.

UTG's life insurance subsidiary has several wholly-owned and majority-owned subsidiaries. The subsidiaries were formed to hold certain real estate and other investments. The investments were placed into the limited liability companies and partnerships to provide additional protection to the policyholders and to UG.

Basis of Presentation – The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"), under guidance issued by the Financial Accounting Standards Board ("FASB").  The preparation of financial statements in accordance with GAAP requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Principles of Consolidation – The accompanying consolidated financial statements include the accounts of the Registrant and its wholly and majority-owned subsidiaries.  All significant intercompany accounts and transactions have been eliminated during consolidation.

Business Segments – The Company has only one business segment – life insurance.

Investments – The Company reports its investments as follows:

Fixed Maturity Investments – The Company classifies its fixed maturity investments, which include bonds, as available for sale. Investments classified as available for sale are carried at fair value with unrealized gains and losses, net of deferred taxes, reflected directly in accumulated other comprehensive income.  Premiums and discounts on debt securities purchased at other than par value are amortized and accreted, respectively, to interest income in the Consolidated Statements of Operations, using the constant yield method over the period to maturity.  Net realized gains and losses on sales of available for sale securities, and unrealized losses considered to be other-than-temporary, are recorded to net realized investment gains (losses) in the Consolidated Statements of Operations.

Equity Securities – Investments in equity securities, which include common and preferred stocks, are reported at fair value with unrealized gains and losses, net of deferred taxes, reflected directly in accumulated other comprehensive income (loss).

Trading Securities – Trading security investments are reported at fair value with gains and losses resulting from changes in fair value recognized in earnings. Trading securities include exchange traded equities and exchange traded options.

Mortgage Loans on Real Estate – Mortgage loans on real estate are reported at their unpaid principal balances, adjusted for amortization of premium or discount and valuation allowances. Valuation allowances are established for impaired loans when it is probable that contractual principal and interest will not be collected. Included in the mortgage loans balance is discounted mortgage loans on real estate. Discounted mortgage loans on real estate are loans that the Company purchased at a deep discount through an auction process led by the Federal Government or other intermediary.  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 adjusted for any principal receipts received.  Management works with the borrower to reach a settlement on the loan or they foreclose on the underlying collateral which is primarily commercial real estate.  For cash payments received during the work out process, the Company records these payments to interest income on a cash basis.  For loan settlements reached, the Company records the amount in excess of the carrying amount of the loan as a discount accretion to investment income at the closing date.  Management reviews the discount loan portfolio regularly for impairment.  If an impairment is identified (after consideration of the underlying collateral), the Company records an impairment to earnings in the period the information becomes known.

Investment Real Estate – Investment real estate held for sale is reported at the lower of cost or fair value less cost to sell. Expenses to maintain the property are expensed as incurred.

Notes Receivable – Notes receivable are reported at their unpaid principal balances, adjusted for valuation allowances. Valuation allowances are established for impaired loans when it is probable that contractual principal and interest will not be collected. Interest accruals are analyzed based on the likelihood of repayment. The Company does not utilize a specified number of days delinquent to cause an automatic non-accrual status.

Policy Loans – Policy loans are reported at their unpaid balances, including accumulated interest, but not in excess of the cash surrender value of the related policy.

Short-Term Investments – Short-term investments are reported at amortized cost, which approximates fair value.

Gains and Losses – Realized gains and losses include sales of investments and investment impairments.  If any, other-than-temporary impairments in fair value are recognized in net income on the specific identification basis.

Fair Value – Fair values for cash, short-term investments, short-term debt, receivables and payables approximate carrying value. Fair values for fixed maturities, equity securities and certain other assets are determined in accordance with specific accounting guidance.  Fair values are based on quoted market prices, where available.  Otherwise, fair values are based on quoted market prices of comparable instruments in active markets, quotes in inactive markets, or other observable criteria. Mortgage loans on real estate are estimated using discounted cash flow analyses. Discounted mortgage loans on real estate are reported at original purchase price, which Management believes approximates fair value.  For more specific information regarding the Company's measurements and procedures in valuing financial instruments, see Note 3 – Fair Value Measurements.

Impairment of Investments – The Company evaluates its investment portfolio for other-than-temporary impairments as described in Note 2 – Investments.  If a security is deemed to be other-than-temporarily impaired, the cost basis of the security is written down to fair value and is treated as a realized loss.

Current accounting guidance states that if an entity intends to sell or if it is more likely than not that it will be required to sell an impaired security prior to recovery of its cost basis, the security is to be considered other-than-temporarily impaired and the full amount of impairment must be charged to earnings.  Otherwise, losses on fixed maturities which are other-than-temporarily impaired are separated into two categories, the portion of the loss which is considered credit loss and the portion of the loss which is due to other factors.  The credit loss portion is charged to earnings while the loss due to other factors is charged to other comprehensive income.

Cash Equivalents – The Company considers certificates of deposit and other short-term instruments with an original purchased maturity of three months or less to be cash equivalents.

Cash – Cash consists of balances on hand and on deposit in banks and financial institutions.

Reinsurance - In the normal course of business, the Company seeks to limit its exposure to loss on any single insured and to recover a portion of benefits paid by ceding reinsurance to other insurance enterprises or reinsurers under excess coverage and coinsurance contracts.  The Company retains a maximum of  $125,000 of coverage per individual life.

Reinsurance receivables are recognized in a manner consistent with the liabilities relating to the underlying reinsured contracts. The cost of reinsurance related to long-duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies.

Cost of Insurance Acquired - When an insurance company is acquired, the Company assigns a portion of its cost to the right to receive future cash flows from insurance contracts existing at the date of the acquisition. The cost of policies purchased represents the actuarially determined present value of the projected future profits from the acquired policies. 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 amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised.

Property and Equipment - Company-occupied property, data processing equipment and furniture and office equipment are stated at cost less accumulated depreciation of  $3,323,718 and $3,868,331 at December 31, 2015 and 2014, respectively. Depreciation is computed on a straight-line basis for financial reporting purposes using estimated useful lives of  three to thirty years.  Depreciation expense was $139,218 and $309,279 for the years ended December 31, 2015 and 2014, respectively.

Future Policy Benefits and Expenses - The liabilities for traditional life insurance and accident and health insurance policy benefits are computed using a net level method. These liabilities include assumptions as to investment yields, mortality, withdrawals, and other assumptions based on the life insurance subsidiary's experience adjusted to reflect anticipated trends and to include provisions for possible unfavorable deviations. The Company makes these assumptions at the time the contract is issued or, in the case of contracts acquired by purchase, at the purchase date.  Future policy benefits for individual life insurance and annuity policies are computed using interest rates ranging from 2% to 6% for life insurance and 2.5% to 7.50% for annuities. Benefit reserves for traditional life insurance policies include certain deferred profits on limited-payment policies that are being recognized in income over the policy term. Policy benefit claims are charged to expense in the period that the claims are incurred. The mortality rate assumptions for policies currently issued by the Company are based on 2001 select and ultimate tables.  Withdrawal rate assumptions are based upon Linton B or C, which are industry standard actuarial tables for forecasting assumed policy lapse rates.

Benefit reserves for universal life insurance and interest sensitive life insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges.  Policy benefits and claims that are charged to expense include benefit claims in excess of related policy account balances.  Interest crediting rates for universal life and interest sensitive products range from 4.0% to 5.5% as of December 31, 2015 and 2014.

Policy Claims and Benefits Payable - Policy and contract claims include provisions for reported claims in process of settlement, valued in accordance with the terms of the policies and contracts, as well as provisions for claims incurred and unreported. The estimate of incurred and unreported claims is based on prior experience. The Company makes an estimate after careful evaluation of all information available to the Company.  There is no certainty the stated liability for policy claims and benefits payable, including the estimate for incurred but unreported claims, will be the Company's ultimate obligation.

Income Taxes – Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement book values and tax bases of assets and liabilities.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  More information concerning income taxes is provided in Note 6 – Income Taxes.

Earnings Per Share – The objective of both basic earnings per share ("EPS") and diluted EPS is to measure the performance of an entity over the reporting period.  The Company presents basic and diluted EPS on the face of the Consolidated Statements of Operations. Basic EPS is computed by dividing income available to common shareholders by the weighted average common shares outstanding for the period.  Diluted EPS is calculated by adding to shares outstanding the additional net effect of potentially dilutive securities or contracts, such as stock options, which could be exercised or converted into common shares.

Recognition of Revenues and Related Expenses - Premiums for traditional life insurance products, which include those products with fixed and guaranteed premiums and benefits, consist principally of whole life insurance policies, and certain annuities with life contingencies are recognized as revenues when due. Limited payment life insurance policies defer gross premiums received in excess of net premiums, which is then recognized in income in a constant relationship with insurance in-force. Accident and health insurance premiums are recognized as revenue pro rata over the terms of the policies. Benefits and related expenses associated with the premiums earned are charged to expense proportionately over the lives of the policies through a provision for future policy benefit liabilities and through deferral and amortization of deferred policy acquisition costs. For universal life and investment products, generally there is no requirement for payment of premium other than to maintain account values at a level sufficient to pay mortality and expense charges. Consequently, premiums for universal life policies and investment products are not reported as revenue, but as deposits. Policy fee revenue for universal life policies and investment products consists of charges for the cost of insurance and policy administration fees assessed during the period. Expenses include interest credited to policy account balances and benefit claims incurred in excess of policy account balances.

Recently Issued Accounting Standards

Accounting Standards Update (ASU) 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities – ASU 2016-01 makes targeted improvements to existing U.S. GAAP for financial instruments, including requiring equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; requiring entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; requiring separate presentation of financial assets and financial liabilities by measurement category and form of financial asset and requiring entities to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk (also referred to as "own credit") when the organization has elected to measure the liability at fair value in accordance with the fair value option. The new guidance is effective for public companies for fiscal years beginning after December 15, 2017. Early adoption of the own credit provision is permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements.

Accounting Standards Update (ASU) 2015-17, Income Taxes: Balance Sheet Classification of Deferred Taxes – ASU 2015-17 simplifies the presentation of deferred income taxes to require that deferred tax assets and liabilities be classified as non-current in a classified balance sheet. Current U.S. GAAP requires an entity to separate deferred income tax assets and liabilities into current and non-current amounts in a classified balance sheet. The current requirement that deferred tax assets and liabilities of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments of this Update.  For public companies, the guidance is ASC 2015-17 is effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Earlier adoption is permitted. The adoption of this guidance is not expected to have a material impact on the Company's consolidated financial statements.

Accounting Standards Update (ASU) 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis – ASU 2015-02 makes changes to both the variable interest model and voting interest model and eliminates the indefinite deferral of FASB Statement No. 167, included in ASU 2010-10, for certain investment funds. All reporting entities that hold a variable interest in other legal entities will need to re-evaluate their consolidation conclusions as well as disclosure requirements. This ASU is effective for annual periods beginning after December 15, 2015, and early adoption is permitted, including any interim period. This is not expected to have a material impact on the financial statements of the Company.

Accounting Standards Update (ASU) 2015-01, Income Statement – Extraordinary and Unusual Items – ASU 2015-01 removes the concept of extraordinary items from U.S. GAAP.  Under the existing guidance, an entity is required to separately disclose extraordinary items, net of tax, in the income statement after income from continuing operations if an event or transaction is unusual and occurs infrequently.  This separate, net-of-tax presentation will no longer be allowed.  The existing requirement to separately disclose events or transactions that are unusual or occur infrequently on a pre-tax basis within continuing operations in the income statement has been retained.  The new guidance requires similar separate presentation of items that are both unusual and infrequent.  The new standard is effective for periods beginning after December 15, 2015.  Early adoption is permitted, but only as of the beginning of the fiscal year of adoption.  Upon adoption, the Company will present transactions that are both unusual and infrequent, if any, on a pre-tax basis within continuing operations in the Consolidated Statements of Operations.

Reclassifications – Certain reclassifications have been made to the 2014 consolidated financial statements to make them comparable to the current year consolidated financial statements.

Note 2 – Investments

Available for Sale Securities – Fixed Maturity and Equity Securities

The following tables provide a summary of fixed maturities available for sale and equity securities by original or amortized cost and estimated fair value:

December 31, 2015	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	$	20,336,681	$	1,441,890	$	(32,083	)	$	21,746,488
U.S. special revenue and assessments		1,137,546		7,843		(2,550	)		1,142,839
All other corporate bonds		167,173,444		3,762,156		(8,705,830	)		162,229,770
		188,647,671		5,211,889		(8,740,463	)		185,119,097
Equity securities		43,954,737		2,119,205		(388,602	)		45,685,340
Total	$	232,602,408	$	7,331,094	$	(9,129,065	)	$	230,804,437

December 31, 2014	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	$	23,036,161	$	1,970,791	$	(50,184	)	$	24,956,768
States, municipalities and political subdivisions		95,000		2,385		0			97,385
U.S. special revenue and assessments		1,137,702		13,739		(202,930	)		948,511
Collateralized mortgage obligations		1,005,081		92,091		(6	)		1,097,166
Public utilities		399,927		55,913		0			455,840
All other corporate bonds		162,960,493		8,624,486		(1,659,193	)		169,925,786
		188,634,364		10,759,405		(1,912,313	)		197,481,456
Equity securities		39,275,638		2,260,855		(540,491	)		40,996,002
Total	$	227,910,002	$	13,020,260	$	(2,452,804	)	$	238,477,458

The following table provides a summary of fixed maturities by contractual maturity as of  December 31, 2015. Actual maturities could differ from contractual maturities due to call or prepayment provisions:

Fixed Maturities Available for Sale December 31, 2015	Amortized Cost		Estimated Fair Value
Due in one year or less	$	3,961,534	$	4,000,512
Due after one year through five years		23,444,519		24,343,844
Due after five years through ten years		64,352,687		62,094,221
Due after ten years		96,888,931		94,680,520
Total	$	188,647,671	$	185,119,097

By insurance statute, the majority of the Company's investment portfolio is invested in investment grade securities to provide ample protection for policyholders.

Below investment grade debt securities generally provide higher yields and involve greater risks than investment grade debt securities because their issuers typically are more highly leveraged and more vulnerable to adverse economic conditions than investment grade issuers. In addition, the trading market for these securities is usually more limited than for investment grade debt securities. Debt securities classified as below-investment grade are those that receive a Standard & Poor's rating of BB+ or below.

The Company held below investment grade investments with an estimated market value of $13,352,934 and $9,142,063 as of December 31, 2015 and 2014, respectively. The investments are all classified as "All other corporate bonds".

The fair value of investments with sustained gross unrealized losses at December 31, 2015 and 2014 are as follows:

December 31, 2015	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	$	4,966,210	(32,083)	$	0	0	$	4,966,210	(32,083)
U.S. special revenue and assessments		984,770	(2,550)		0	0		984,770	(2,550)
All other corporate bonds		85,734,097	(5,255,276)		19,400,640	(3,450,554)		105,134,737	(8,705,830)
Total fixed maturities	$	91,685,077	(5,289,909)	$	19,400,640	(3,450,554)	$	111,085,717	(8,740,463)
Equity securities	$	4,741,132	(388,602)	$	0	0	$	4,741,132	(388,602)

December 31, 2014	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		0	0		4,947,265	(50,184)		4,947,265	(50,184)
U.S. special revenue and assessments		0	0		784,390	(202,930)		784,390	(202,930)
Collateralized mortgage obligations		0	0		1,012	(6)		1,012	(6)
All other corporate bonds	$	28,954,477	(416,560)	$	3,535,206	(1,242,633)	$	32,489,683	(1,659,193)
Total fixed maturities	$	28,954,477	(416,560)	$	9,267,873	(1,495,753)	$	38,222,350	(1,912,313)
Equity securities	$	6,067,132	(540,491)	$	0	0	$	6,067,132	(540,491)

The following table provides additional information regarding the number of securities that were in an unrealized loss position for greater than or less than twelve months:

	Less than 12 months	12 months or longer	Total
As of December 31, 2015
Fixed maturities	40	9	49
Equity securities	9	0	9
As of December 31, 2014
Fixed maturities	18	7	25
Equity securities	25	0	25

Substantially all of the unrealized losses on fixed maturities available for sale at December 31, 2015 and 2014 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 December 31, 2015 and 2014

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 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 December 31, 2015 was $0 and $(28,609), respectively. The fair value of derivatives included in trading security assets and trading security liabilities as of December 31, 2014 was $6,250 and $(23,853), 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.

As of June 30, 2015, the Company reclassified its remaining exchange-traded equity trading security to the available for sale category. The fair value of the security at the time of the reclassification was $3,224,000.  Trading securities are purchased and held primarily for purposes of selling them in the near term and reflect active and frequent buying and selling. Management analyzed the recent buying and selling activity related to the exchange-traded equity and deems the available for sale category to better reflect Management's intent for this security going forward. Through June 30, 2015, unrealized gains and losses from this exchange-traded equity were recorded as a component of earnings. Subsequent unrealized gains/losses are reported as a component of comprehensive income.

The following table reflects trading securities revenue charged to net investment income for the periods ended December 31:

	2015				2014
Net unrealized gains (losses)		$	945,128			$	(722,573	)
Net realized gains (losses)			(515,967	)			245,995
Net unrealized and realized gains (losses)		$	429,161			$	(476,578	)

Mortgage Loans on Real Estate

The Company, from time to time, acquires mortgage loans through participation agreements with FSNB. FSNB has been able to provide the Company with additional expertise and experience in underwriting commercial and residential mortgage loans, which provide more attractive yields than the traditional bond market. The Company is able to receive participations from FSNB for three primary reasons: 1) FSNB has already reached its maximum lending limit to a single borrower, but the borrower is still considered a suitable risk; 2) the interest rate on a particular loan may be fixed for a long period that is more suitable for UG given its asset-liability structure; and 3) FSNB's loan growth might at times outpace its deposit growth, resulting in FSNB participating such excess loan growth rather than turning customers away. For originated loans, the Company's Management is responsible for the final approval of such loans after evaluation. Before a new loan is issued, the applicant is subject to certain criteria set forth by Company Management to ensure quality control. These criteria include, but are not limited to, a credit report, personal financial information such as outstanding debt, sources of income, and personal equity. Once the loan is approved, the Company directly funds the loan to the borrower. The Company bears all risk of loss associated with the terms of the mortgage with the borrower.

Approximately 30% and 39% of the mortgage loan portfolio consists of discounted commercial mortgage loans as of December 31, 2015 and 2014, respectively. The Company began purchasing discounted commercial mortgage loans in 2009. Management has extensive background and experience in the analysis and valuation of commercial real estate. The discounted loans are available through the FDIC's sale of assets of closed banks and from banks wanting to reduce their loan portfolios. The loans are available on a loan by loan bid process. Once a loan has been acquired, contact is made with the appropriate individuals to begin a dialog with a goal of determining the borrower's willingness to work together. There are generally three paths a discounted loan will take: the borrowers pay as required; a settlement is reached with the loan being paid off at a discounted value; or the loan is foreclosed.

During 2015 and 2014, the Company acquired $13,774,698 and $2,348,890 in mortgage loans, respectively, including both regular participation mortgage loans as well as discounted mortgage loans.  FSNB services the majority of the Company's mortgage loan portfolio. The Company pays FSNB a .25% servicing fee on these loans and a one-time fee at loan origination of .50% of the original loan cost to cover costs incurred by FSNB relating to the processing and establishment of the loan.

During 2015 and 2014, the maximum and minimum lending rates for mortgage loans were:

	2015		2014
	Maximum rate	Minimum rate	Maximum rate	Minimum rate
Commercial Loans	8.00 %	4.00 %	10.00 %	3.91 %
Residential Loans	8.00 %	3.00 %	8.00 %	7.00 %

Most mortgage loans are first position loans.  Loans issued are generally limited to no more than 80% of the appraised value of the property.

The Company has in place a monitoring system to provide Management with information regarding potential troubled loans. Letters are sent to each mortgagee when the loan becomes 30 days or more delinquent. Management is provided with a monthly listing of loans that are 60 days or more past due along with a brief description of what steps are being taken to resolve the delinquency. All loans 90 days or more past due are placed on a non-performing status and classified as delinquent loans. Quarterly, coinciding with external financial reporting, the Company reviews each delinquent loan and determines how each delinquent loan should be classified. Management believes the current internal controls surrounding the mortgage loan selection process provide a quality portfolio with minimal risk of foreclosure and/or negative financial impact.

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. The Company records repayments on loans as discount accrual when the loan basis has been paid in full.

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 acquired 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 not currently paying are being vigorously worked by Management.  The current discounted commercial mortgage loan portfolio has an average price of 39.0 % 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.  The mortgage loan reserve was $0 at December 31, 2015 and 2014.

The following table summarizes the number of loans held in the discounted mortgage loan portfolio and the carrying value of the loans as of December 31, 2015:

Payment Frequency	Number of Loans		Carrying Value
No payments received		8	$	0
One-time payment received		1		0
Irregular payments received		2		20,834
Periodic payments received		7		5,347,215
Total		18	$	5,368,049

The following table summarizes the mortgage loan holdings of the Company for the periods ended December 31:

	2015		2014
In good standing	$	14,701,228	$	14,443,455
Overdue interest over 90 days		20,834		3,130,290
Restructured		126,118		1,104,972
In process of foreclosure		2,921,750		4,483,265
Total mortgage loans	$	17,769,930	$	23,161,982
Total foreclosed  loans during the year	$	0	$	56,576

Investment Real Estate

Real estate acquired through foreclosure, consisting of properties obtained through foreclosure proceedings or acceptance of a deed in lieu of foreclosure, is reported on an individual asset basis at the lower of cost or fair value, less disposal costs. Fair value is determined on the basis of current appraisals, comparable sales, and other estimates of value obtained principally from independent sources. When properties are acquired through foreclosure, any excess of the loan balance at the time of foreclosure over the fair value of the real estate held as collateral is recognized and charged to the Consolidated Statements of Operations. Based upon Management's evaluation of the real estate acquired through foreclosure, additional expense is recorded when necessary in an amount sufficient to reflect any declines in estimated fair value. Gains and losses recognized on the disposition of the properties are recorded as realized gains and losses in the Consolidated Statements of Operations.

Notes Receivable

Notes receivable represent collateral loans and promissory notes issued by the Company and are reported at their unpaid principal balances, adjusted for valuation allowances. Valuation allowances are established for impaired loans when it is probable that contractual principal and interest will not be collected. The valuation allowance as of December 31, 2015 and 2014 was $0. Interest accruals are analyzed based on the likelihood of repayment.  The Company does not utilize a specified number of days delinquent to cause an automatic non-accrual status.

Before a new note is issued, the applicant is subject to certain criteria set forth by Company Management to ensure quality control.  Once the note is approved, the Company directly funds the note to the borrower. Several of the notes have participation agreements in place, whereas the Company has reduced its investment in the note receivable by participating a portion of the note to a third party.

Similar to the mortgage loans, FSNB services several of the notes receivable. The Company, and the participants in the notes, share in the risk of loss associated with the terms of the note with the borrower, based upon their ownership percentage in the note.  The Company has in place a monitoring system to provide Management with information regarding potential troubled loans. 

Analysis of Investment Operations

The following table reflects the Company's net investment income for the periods ended December 31:

	2015			2014
Fixed maturities	$	8,559,938		$	8,225,640
Equity securities		1,708,786			3,255,611
Trading securities		(429,161	)		(476,578	)
Mortgage loans		5,700,492			4,592,853
Real estate		1,474,726			8,355,153
Notes receivable		787,658			340,000
Policy loans		720,544			760,715
Cash and cash equivalents		681			505
Short-term		699,357			70,578
Total consolidated investment income		19,223,021			25,124,477
Investment expenses		(3,663,086	)		(8,774,758	)
Consolidated net investment income	$	15,559,935		$	16,349,719

The following table reflects the Company's net realized investments gains and losses for the periods ended December 31:

2015	Gross Realized Gains		Gross Realized (Losses)		Net Realized Gains (Losses)
Fixed maturities	$	1,289,455	$	(41,215)	$	1,248,240
Real estate		5,968,558		0		5,968,558
Common stock		48,165		(238,794)		(190,629)
Preferred stock		971,662		(637)		971,025
Real estate – OTTI		0		(54,901)		(54,901)
Common stock – OTTI		0		(3,515,700)		(3,515,700)
Total realized gains (losses)	$	8,277,840	$	(3,851,247)	$	4,426,593

2014	Gross Realized Gains		Gross Realized (Losses)		Net Realized Gains (Losses)
Fixed maturities	$	2,414,160	$	(1,135,417)	$	1,278,743
Real estate		14,757,451		(1,460,332)		13,297,119
Common stock		673,821		(14,908)		658,913
Preferred stock		1,986,303		0		1,986,303
Real estate – OTTI		0		(35,946)		(35,946)
Common stock – OTTI		0		(126,959)		(126,959)
Total realized gains (losses)	$	19,831,735	$	(2,773,562)	$	17,058,173

Other-Than-Temporary Impairments

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 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 Consolidated Statements of Operations.

Management regularly reviews its real estate portfolio in comparison to appraisal valuations and current market conditions for indications of other-than-temporary impairments. If a decline in value is judged by Management to be other-than-temporary, a loss is recognized by a charge to other-than-temporary impairment losses in the 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 Consolidated Statements of Operations for the periods ended December 31:

	2015		2014
Other than temporary impairments:
Common stock	$	3,515,700	$	126,959
Real estate		54,901		35,946
Total other than temporary impairments	$	3,570,601	$	162,905

The other-than-temporary impairments recognized during 2015 and 2014 were taken as a result of Management's assessment and consideration of the length of time the securities have remained in an unrealized loss position and as a result of management's analysis and determination of value. The investments were written down to better reflect their current expected market value.

Investments on Deposit

The Company had investments with a fair value of $8,932,241 and $10,635,716 on deposit with various state insurance departments as of December 31, 2015 and 2014, respectively.

Note 3 – Fair Value Measurements

The Company measures its assets and liabilities recorded at fair value in the 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 and financial institutions. 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 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 following table presents the Company's assets and liabilities measured at fair value in the consolidated balance sheet on a recurring basis as of December 31, 2015.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	10,459,758	$	173,632,645	$	1,026,694	$	185,119,097
Equity Securities, available for sale		13,312,331		5,567,061		26,805,948		45,685,340
Total		23,772,089		179,199,706		27,832,642		230,804,437
Liabilities
Trading Securities	$	28,609	$	0	$	0	$	28,609

The following table presents the Company's assets and liabilities measured at fair value in the consolidated balance sheet on a recurring basis as of December 31, 2014.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	13,374,878	$	183,236,853	$	869,725	$	197,481,456
Equity Securities, available for sale		4,756,292		7,361,076		28,878,634		40,996,002
Trading Securities		3,826,250		0		0		3,826,250
Total	$	21,957,420	$	190,597,929	$	29,748,359	$	242,303,708
Liabilities
Trading Securities	$	23,853	$	0	$	0	$	23,853

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, 2014	$	869,725		$	28,878,634		$	29,748,359
Transfers in to Level 3		0			0			0
Total unrealized gains or (losses):
Included in realized gains (losses)		67,905			-			67,905
Included in other comprehensive income		210,819			270,670			481,489
Purchases		0			1,920,607			1,920,607
Sales		(121,755	)		(4,263,963	)		(4,385,718	)
Balance at December 31, 2015	$	1,026,694		$	26,805,948		$	27,832,642

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. The Company computed fair value of Level 3 equity investments based on a review of current financial information, earnings trends and similar companies in the same industries.

There were no transfers in or out of Level 3 as of December 31, 2015.  Transfers occur when there is a lack of observable market information.

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 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 Consolidated Balance Sheets are shown below. Because the fair value for all 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.

	December 31, 2015				December 31, 2014
Assets	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Mortgage loans on real estate	$	17,769,930	$	17,775,178	$	23,161,982	$	23,337,728
Investment real estate		47,650,102		47,650,102		51,007,101		51,007,101
Notes receivable		10,597,907		10,597,907		5,612,560		5,612,560
Policy loans		10,684,244		10,684,244		11,104,485		11,104,485
Cash and cash equivalents		11,822,615		11,822,615		13,977,443		13,977,443
Short term investments		0		0		4,382,181		4,382,181
Liabilities
Notes payable		0		0		4,400,000		4,400,000

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.

A portion of the mortgage loans balance consists of discounted mortgage loans. 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.

Notes receivable are carried at their unpaid principal balances, which approximates fair value. The inputs used to measure the fair value of the loans 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 Consolidated Balance Sheets 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 Consolidated Balance Sheets 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 4 - Reinsurance

As is customary in the insurance industry, the insurance subsidiary cedes insurance to, and assumes insurance from, other insurance companies under reinsurance agreements. Reinsurance agreements are intended to limit a life insurer's maximum loss on a large or unusually hazardous risk or to obtain a greater diversification of risk. The ceding insurance company remains primarily liable with respect to ceded insurance should any reinsurer be unable to meet the obligations assumed by it. However, it is the practice of insurers to reduce their exposure to loss to the extent that they have been reinsured with other insurance companies. The Company sets a limit on the amount of insurance retained on the life of any one person. The Company will not retain more than $125,000, including accidental death benefits, on any one life. At December 31, 2015, the Company had gross insurance in-force of $1.3 billion of which approximately $272 million was ceded to reinsurers.  At December 31, 2014, the Company had gross insurance in-force of $1.4 billion of which approximately $287 million was ceded to reinsurers.

The Company's reinsured business is ceded to numerous reinsurers. The Company monitors the solvency of its reinsurers in seeking to minimize the risk of loss in the event of a failure by one of the parties. The Company is primarily liable to the insureds even if the reinsurers are unable to meet their obligations. The primary reinsurers of the Company are large, well-capitalized entities.

Most recently, UG utilized reinsurance agreements with Optimum Re Insurance Company ("Optimum"), and Swiss Re Life and Health America Incorporated ("SWISS RE"). Optimum and SWISS RE currently hold an "A-" (Excellent) and "A+" (Superior) rating, respectively, from A.M. Best, an industry rating company. The reinsurance agreements were effective December 1, 1993, and covered most new business of UG. Under the terms of the agreements, UG cedes risk amounts above its retention limit of $100,000 with a minimum cession of $25,000. Ceded amounts are shared equally between the two reinsurers on a yearly renewable term ("YRT") basis, a common industry method. The treaty is self-administered; meaning the Company records the reinsurance results and reports them to the reinsurers.

Also, Optimum is the reinsurer of 100% of the accidental death benefits ("ADB") in force of UG.  This coverage is renewable annually at the Company's option.  Optimum specializes in reinsurance agreements with small to mid-size carriers such as UG.

UG entered into a coinsurance agreement with Park Avenue Life Insurance Company ("PALIC") effective September 30, 1996.  Under the terms of the agreement, UG ceded to PALIC substantially all of its then in-force paid-up life insurance policies.  Paid-up life insurance generally refers to non-premium paying life insurance policies.  Under the terms of the agreement, UG sold 100 % of the future results of this block of business to PALIC through a coinsurance agreement.  UG continues to administer the business for PALIC and receives a servicing fee through a commission allowance based on the remaining in-force policies each month.  PALIC has the right to assumption reinsure the business, at its option, and transfer the administration.  The Company is not aware of any such plans.  PALIC's ultimate parent, The Guardian Life Insurance Company of America ("Guardian"), currently holds an "A++" (Superior) rating from A.M. Best.  The PALIC agreement accounts for approximately 63 % of UG's reinsurance reserve credit, as of December 31, 2015 and 2014.

At December 31, 1992, UG (formerly American Capitol) entered into a reinsurance agreement with Canada Life Assurance Company ("the Canada Life agreement") that fully reinsured virtually all of its traditional life insurance policies. The reinsurer's obligations under the Canada Life agreement were secured by assets withheld by UG representing policy loans and deferred and uncollected premiums related to the reinsured policies. UG continues to administer the reinsured policies. At December 31, 2013, the Canada Life agreement had insurance in-force of approximately $6,815,000, with no reserve credit being taken on that amount.  The Canada Life agreement was fully repaid in August 2012. With the reinsurance recaptured by the Company, a 15 % profit share will continue to be paid to the reinsurer going forward relative to the block of business.  Effective July 1, 2014, the Company acquired the 15% profit share on this block of business from Canada Life for $300,000. This payment effectively settled any future obligations of the Company to the reinsurer under this agreement.

During 2014, the Company disposed of a block of business through an assumption reinsurance agreement, whereby the Company transferred cash of $3,000,000 and extinguished reserves of $3,600,000and reduced cost of insurance acquired by $600,000.

On September 30, 1998, UG entered into a coinsurance agreement with The Independent Order of Vikings, (IOV) an Illinois fraternal benefit society.  Under the terms of the agreement, UG agreed to assume, on a coinsurance basis, 25% of the reserves and liabilities arising from all in-force insurance contracts issued by the IOV to its members.  At December 31, 2015, the IOV insurance in-force assumed by UG was approximately $1,451,000, with reserves being held on that amount of approximately $350,000. At December 31, 2014, the IOV insurance in-force assumed by UG was approximately $1,503,000, with reserves being held on that amount of approximately $346,000.

The Company does not have any short-duration reinsurance contracts.  The effect of the Company's long-duration reinsurance contracts on premiums earned in 2015 and 2014 were as follows:

	2015 Premiums Earned			2014 Premiums Earned
Direct	$	11,140,000		$	11,642,000
Assumed		25,000			26,000
Ceded		(3,091,000	)		(3,127,000	)
Net Premiums	$	8,074,000		$	8,541,000

Note 5 – Cost of Insurance Acquired

When an insurance company is acquired, the Company assigns a portion of its cost to the right to receive future cash flows from insurance contracts existing at the date of the acquisition.  The cost of policies purchased represents the actuarially determined present value of the projected future profits from the acquired policies.  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 utilized may vary due to differences in the blocks of business.  The interest rate utilized in the amortization calculation of the remaining cost of insurance acquired is 12%. The amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised.

	2015			2014
Cost of insurance acquired, beginning of year	$	9,047,984		$	10,636,412
Sale of block of business		0			(602,778	)
Interest accretion		1,180,703			1,298,980
Amortization		(2,088,308	)		(2,284,630	)
Net amortization		(907,605	)		(985,650	)
Cost of insurance acquired, end of year	$	8,140,379		$	9,047,984

Estimated net amortization expense of cost of insurance acquired for the next five years is as follows:

	Interest Accretion	Amortization	Net Amortization
2016	1,072,000	1,945,000	873,000
2017	967,000	1,806,000	839,000
2018	866,000	1,672,000	806,000
2019	770,000	1,546,000	776,000
2020	677,000	1,421,000	744,000

Note 6 – Income Taxes

UTG and UG file separate federal income tax returns.

Income tax expense (benefit) consists of the following components:

	2015				2014
Current tax		$	747,714			$	3,233,286
Deferred tax			(1,680,429	)			(2,150,359	)
Income tax expense (benefit)		$	(932,715	)		$	1,082,927

The expense for income differed from the amounts computed by applying the applicable United States statutory rate of 35% before income taxes as a result of the following differences:

	2015			2014
Tax computed at statutory rate	$	95,663		$	3,894,334
Changes in taxes due to:
Non-controlling interest		(101,297	)		(1,073,704	)
Current period loss for which no tax benefit was recognized		17,693			17,401
Small company deduction		(552,694	)		(134,653	)
Dividend received deduction		(100,349	)		(1,414,353	)
Other		(291,731	)		(206,098	)
Income tax expense (benefit)	$	(932,715	)	$	1,082,927

The following table summarizes the major components that comprise the deferred tax liability as reflected in the balance sheets:

	2015			2014
Investments	$	(2,735,072	)	$	2,728,928
Cost of insurance acquired		2,849,133			3,166,794
Management/consulting fees		(55,125	)		(57,454	)
Future policy benefits		1,546,770			1,778,105
Deferred gain on sale of subsidiary		2,312,483			2,312,483
Other liabilities		27,406			(127,461	)
Federal tax DAC		(540,128	)		(387,601	)
Deferred tax liability	$	3,405,467		$	9,413,794

At December 31, 2015 and 2014, the Company had gross deferred tax assets of $4,896,464 and $2,405,249, respectively, and gross deferred tax liabilities of $8,301,931 and $11,819,043, respectively, resulting from temporary differences primarily related to the life insurance subsidiary.  A valuation allowance is to be provided when it is more likely than not that deferred tax assets will not be realized by the Company. No valuation allowance has been recorded (except as noted below) relating to the Company's deferred tax assets since, in Management's judgment, the Company will more likely than not have sufficient taxable income in future periods to fully realize its existing deferred tax assets.

As of December 31, 2015 and 2014, the Company had a deferred tax asset of $35,094 and $17,401, respectively, relating to a net operating loss carryforward.  The Company established an allowance of $35,094and $17,401against this deferred tax asset as of December 31, 2015 and 2014, respectively.  The Company also has a deferred tax asset of $118,693and $0 relating to an AMT tax carryforward as of December 31, 2015 and 2014, respectively.  The Company established an allowance of $118,693 against this deferred tax asset as of December 31, 2015.  The allowances were established based on Management's assessment of the recoverability of these deferred assets.

The Company's Federal income tax returns are periodically audited by the Internal Revenue Service ("IRS"). In February 2011, the IRS audited UTG's 2009 federal income tax return. The examination was closed with no adjustments to the return. There are currently no examinations in process, nor is Management aware of any pending examination by the IRS. The Company follows the accounting guidance for uncertainty in income taxes using the provisions of Financial Accounting Standards Board ("FASB") ASC 740, Income Taxes.  Using that guidance, tax positions initially need to be recognized in the financial statements when it is more-likely-than-not the position will be sustained upon examination by the tax authorities.  Such tax positions initially and subsequently need to be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.  The Company has evaluated its tax positions, expiring statutes of limitations, changes in tax law and new authoritative rulings and believes that no disclosure relative to a provision of income taxes is necessary, at this time, to cover any uncertain tax positions.

The Company classifies interest and penalties on underpayment of income taxes as income tax expense. No interest or penalties were included in the reported income taxes for the years presented. The Company is not aware of any potential or proposed changes to any of its tax filings.

Note 7 – Credit Arrangements

At December 31, 2015 and 2014, the Company had the following outstanding debt:

			Outstanding Principal Balance
Instrument	Issue Date	Maturity Date	December 31, 2015			December 31, 2014
Promissory Note:
UTG Avalon	12/29/2014	4/1/2018		$	0		$	4,400,000

Instrument	Issue Date	Maturity Date	Revolving Credit Limit			December 31, 2014			Borrowings		Repayments		December 31, 2015
Lines of Credit:
UTG	11/20/2013	11/20/2015		$	8,000,000		$	0		0		0		$	0
UG	6/2/2015	5/19/2016			10,000,000			0		0		0			0

The UTG Avalon promissory note issued on December 29, 2014 carried interest at a rate of 3.50 % with interest payable quarterly beginning in July of 2015.  The interest is a variable rate that is equal to 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 any change in interest rate is effective the first day of the month following the rate change. Principal is due upon maturity of the note. This note was fully repaid during the third quarter of 2015.  The principal payments were paid by UTG and as a result of the payments; intercompany promissory notes receivable/payable were established.

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").

During June of 2015, the Federal Home Loan Bank approved UG's Cash Management Advance Application ("CMA"). The CMA gives the Company the option of selecting a variable rate of interest for up to 90 days or a fixed rate for a maximum of 30 days. The variable rate CMA is prepayable at any time without a fee, while the fixed CMA is not prepayable prior to maturity.

Note 8 – 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 material 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.

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.

The following table represents the total funding commitments and the unfunded commitment as of December 31, 2015 related to certain investments:

	Total Funding Commitment		Unfunded Commitment
RLF III, LLC	$	4,000,000	$	398,120
Llano Music, LLC		4,000,000		1,179,000
Sovereign's Capital, LP Fund I		500,000		125,000
UGLIC, LLC		1,600,000		120,000
Sovereign's Capital, LP Fund II		1,000,000		810,000

During 2006, the Company committed to invest in RLF III, LLC ("RLF"), which makes land-based investments in undervalued assets. RLF makes 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.  The Company increased its funding commitment by $2,000,000 during 2014. Llano made capital calls to its investors as funds are needed to acquire the royalty rights. The Llano funding commitment expired in January of 2016. Upon expiration of the Llano funding commitment, the Company committed funds to a related entity, Barton Springs Music, LLC, which also invests in music royalties.

During 2012, the Company committed to invest in Sovereign's Capital, LP Fund I ("Sovereign's"), which invests in companies in emerging markets. Sovereign's makes capital calls to investors as funds are needed.

During 2014, the Company committed to invest in UGLIC, LLC, which purchases real estate tax receivables. UGLIC, LLC makes capital calls as funds are needed for additional purchases.

During 2015, the Company committed to invest in Sovereign's Capital, LP Fund II ("Sovereign's II"), which invests in companies in emerging markets. Sovereign's II makes capital calls to investors as funds are needed.

Note 9 – Shareholders' Equity

Stock Repurchase Program – The Board of Directors of UTG has authorized the repurchase in the open market or in privately negotiated transactions of UTG's common stock. At a meeting of the Board of Directors on June 3, 2015, the Board of Directors of UTG authorized the repurchase of up to an additional $1,000,000 of UTG's common stock, for a total, repurchase of $8,000,000. Repurchased shares are available for future issuance for general corporate purposes. This program can be suspended or terminated at any time without further notice. 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 2015, the Company repurchased 25,919 shares through the stock repurchase program for $375,207. Through December 31, 2015, UTG has spent $6.5 million in the acquisition of 688,617 shares under this program.

On July 20, 2015 the Board of Directors of UTG also clarified and amended the terms on which UTG may repurchase shares in the program and gave Company Management broad authority to operate the program, including the discretion of whether to purchase shares and the ability to suspend or terminate the program. The program may be suspended or terminated at any time without further notice.

Director Compensation - Effective September 18, 2013, each outside Director will annually receive $8,000 as a retainer and $1,000 per meeting attended.  The compensation, however, shall be paid in UTG common stock.  The value will be determined annually on the close of business December 20th or the next business day should December 20^th be a weekend or holiday, based on the activity of the year just ending.  UTG's director compensation policy also provides that Directors who are employees of UTG or its affiliates do not receive any compensation for their services as Directors except for reimbursement for reasonable travel expenses for attending each meeting. In December of 2015, the Company issued 4,245shares of its common stock as compensation to the Directors. The shares were valued at $14.36per share, the market value at the date of issue. During 2015, the Company recorded $60,958in operating expense related to the stock issuance.  In December of 2014, the Company issued 4,755shares of its common stock as compensation to the Directors. The shares were valued at $14.50per share, the market value at the date of issue. During 2014, the Company recorded $68,948in operating expense related to the stock issuance.

Earnings Per Share - The following is a reconciliation of basic and diluted weighted average shares outstanding used in the computation of basic and diluted earnings per share:

	2015	2014
Basic weighted average shares outstanding	3,704,322	3,750,239
Weighted average dilutive options outstanding	0	0
Diluted weighted average shares outstanding	3,704,322	3,750,239

The computation of diluted earnings per share is the same as basic earnings per share for the years ending December 31, 2015 and 2014, as there were no outstanding securities, options or other offers that give the right to receive or acquire common shares of UTG.

Statutory Restrictions – Restrictions exist on the flow of funds to UTG from its insurance subsidiary.  Statutory regulations require life insurance subsidiaries to maintain certain minimum amounts of capital and surplus. UG is required to maintain minimum statutory surplus of $2,500,000. At December 31, 2015, substantially all of the consolidated shareholders' equity represents net assets of UTG's subsidiaries.

UG is domiciled in the state of Ohio. Ohio 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.  Extraordinary dividends (amounts in excess of ordinary dividend limitations) require prior approval of the insurance commissioner and are not restricted to a specific calculation.  UG paid ordinary dividends of  $4,000,000 and $4,800,000 to UTG in 2015 and  2014,respectively. No extraordinary dividends were paid during the two year period. UTG used the dividends received during 2014 and 2015 to  purchase outstanding shares of UTG stockand for general operations of the Company.

Statutory Restrictions – Restrictions exist on the flow of funds to UTG from its insurance subsidiary.  Statutory regulations require life insurance subsidiaries to maintain certain minimum amounts of capital and surplus. UG is required to maintain minimum statutory surplus of $2,500,000. At December 31, 2015, substantially all of the consolidated shareholders' equity represents net assets of UTG's subsidiaries.

UG is domiciled in the state of Ohio. Ohio 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.  Extraordinary dividends (amounts in excess of ordinary dividend limitations) require prior approval of the insurance commissioner and are not restricted to a specific calculation.  UG paid ordinary dividends of $4,000,000 and $4,800,000 to UTG in 2015 and 2014, respectively. No extraordinary dividends were paid during the two year period. UTG used the dividends received during 2014 and 2015 to purchase outstanding shares of UTG stock and for general operations of the Company.

Note 10 - Statutory Accounting

The insurance subsidiary prepares its statutory-based financial statements in accordance with accounting practices prescribed or permitted by the Ohio Department of Insurance.  These principles differ significantly from accounting principles generally accepted in the United States of America.  "Prescribed" statutory accounting practices include state laws, regulations, and general administrative rules, as well as a variety of publications of the National Association of Insurance Commissioners (NAIC).  "Permitted" statutory accounting practices encompass all accounting practices that are not prescribed; such practices may differ from state to state, from company to company within a state, and may change in the future.

The following table reflects UG's statutory basis net income and capital and surplus (shareholders' equity) as of December 31:

	2015			2014
Net income (loss)		$	306,059		$	12,200,025
Capital and surplus			39,752,432			41,146,686

Note 11 – Related Party Transactions

On February 20, 2003, UG purchased $4,000,000 of a trust preferred security offering issued by First Southern Bancorp, Inc. ("FSBI").  The security has a mandatory redemption after 30 years with a call provision after 5 years.  The security pays a quarterly dividend at a fixed rate of 6.515 %. The Company received dividends of $264,219 during 2015 and 2014. On March 30, 2009, UG purchased $1,000,000 of FSBI common stock.  The sale and transfer of this security is restricted by the provisions of a stock restriction and buy-sell agreement.

On September 28, 2011 UTG entered a joint ownership agreement with Bandyco, LLC and First Southern National Bank, for an 8.08 % interest in an aircraft. Bandyco, LLC is affiliated with Ward F Correll, who is a Director of the Company. The Company paid a monthly operational fee of $25,000 through July of 2014 when the aircraft was sold.  During July of 2014, the Company acquired a different aircraft.  UTG paid $1,600,000 in the acquisition of the aircraft, increasing the Company's ownership interest to 30.10 %. The aircraft is used for business related travel by various officers and employees of the Company. For years 2015 and 2014, UTG paid $255,920 and $879,453 for costs associated with the aircraft, respectively.

Effective January 1, 2007, UTG entered into administrative services and cost sharing agreements with its subsidiary. Under this arrangement, the subsidiary pays its proportionate share of expenses, based on an allocation formula. During 2015 and 2014, UG paid $6,867,882 and $8,902,568, respectively, in expenses. The Ohio Department of Insurance has approved the cost sharing agreement and it is Management's opinion that where applicable, costs have been allocated fairly and such allocations are based upon accounting principles generally accepted in the United States of America.

The Company from time to time acquires mortgage loans through participation agreements with FSNB.  FSNB services the Company's mortgage loans including those covered by the participation agreements.  The Company pays a 0.25 % servicing fee on these loans and a one-time fee at loan origination of 0.50 % of the original loan cost to cover costs incurred by FSNB relating to the processing and establishment of the loan.  The Company paid $11,622 and $33,894 in servicing fees and $25,000 and $0 in origination fees to FSNB during 2015 and 2014, respectively.

The Company reimbursed expenses incurred by employees of FSNB relating to salaries, travel and other costs incurred on behalf of or relating to the Company. The Company paid $324,918 and $325,479 in 2015 and 2014, respectively to FSNB in reimbursement of such costs. In addition, the Company reimburses FSNB a portion of salaries and pension costs for Mr. Correll and Mr. Ditto. The reimbursement was approved by the UTG Board of Directors and totaled $349,351 and $332,725 in 2015 and 2014, respectively, which included salaries and other benefits.

As previously disclosed in the Notes Receivable section of Note 2 – Investments, several of the Company's notes have participation agreements in place with third parties.  Certain participation agreements are with FSF, a related party.  The participation agreements are sold without recourse and assigned to the participant based on their pro-rata share of the principal, interest and collateral as specified in the participation agreements.The undivided participations in the notes receivable range from 20% - 50%.  The total amount of loans participated to FSF were $3,170,000and $0 as of December 31, 2015 and 2014, respectively. One of the participated notes receivable was fully repaid during the first quarter of 2016 reducing the outstanding participating notes receivable balance with FSF to $670,000.

Note 12 – Other Cash Flow Disclosures

On a cash basis, the Company paid the following expenses for the periods ended December 31:

	2015			2014
Interest		$	70,141		$	635,664
Federal income tax			3,300,000			4,000

During the fourth quarter of 2014, UG's wholly-owned subsidiary, UTG Avalon, LLC, entered into a noncash transaction whereby the subsidiary obtained a promissory note in the amount of $4.4 million and utilized the note to repay a prior line of credit.

Note 13 - Concentrations

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 T. 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.

Because UTG serves primarily individuals located in four states, the ability of our customers to pay their insurance premiums is impacted by the economic conditions in these areas.  As of December 31, 2015 and 2014, approximately 54% of the Company's total direct premium was collected from Illinois, Ohio, Texas and West Virginia. Thus, results of operations are heavily dependent upon the strength of these economies.

The Company reinsures that portion of insurance risk which is in excess of its retention limits. Retention limits range up to $125,000 per life.  Life insurance ceded represented 21% of total life insurance in force at December 31, 2015 and 2014.  Insurance ceded represented 31% and 29% of premium income for 2015 and 2014, respectively. The Company would be liable for the reinsured risks ceded to other companies to the extent that such reinsuring companies are unable to meet their obligations.

Note 14 – Selected Quarterly Financial Data

As a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and Item 10(f)(1) of Regulation S-K, the Company has elected to comply with certain scaled disclosure reporting obligations, and therefore does not have to provide the information required by this item.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)) that are designed to ensure that the information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.  Our disclosure controls and procedures are also designed to ensure that information required to be disclosed in our Exchange Act reports is accumulated and communicated to Management, including our Principal Executive Officer and Principal Financial Officers, to allow timely decisions regarding required disclosures.  In designing and evaluating the disclosure controls and procedures, Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and Management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Our Management, with the participation of our Principal Executive Officer and Principal Financial Officer, evaluated the effectiveness of the Company's disclosure controls and procedures as of December 31, 2015 and, based on this evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that, as of the end of the period covered by this report, the Company's disclosure controls and procedures were effective at a reasonable assurance level.

Management's Report on Internal Controls Over Financial Reporting

Our Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). The Company's internal control over financial reporting is designed to provide reasonable assurance regarding the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

The Company's Management assessed the effectiveness of the Company's internal control over financial reporting as of December 31, 2015. In making the assessment, Management used the criteria issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in Internal Control-Integrated Framework.  Based on Management's assessment, Management concluded that, as of December 31, 2015, the Company's internal control over financial reporting was effective.

This annual report does not include an attestation report of the Company's independent registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's independent registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit the Company to provide only Management's report in this Annual Report.

Changes in Internal Controls

There have been no changes in the Company's internal control over financial reporting since December 31, 2015, in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13a-15(e) and 15d-15(e), that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting. The Company's process for evaluating controls and procedures is continuous and encompasses constant improvement of the design and effectiveness of established controls and procedures and the remediation of any deficiencies, which may be identified during this process.

Item 9B. Other Information

None

PART III

Item 10. Directors, Executive Officers and Corporate Governance

The Board of Directors

In accordance with the laws of Delaware and the Certificate of Incorporation and Bylaws of UTG, as amended, UTG is managed by its executive officers under the direction of the Board of Directors. The Board elects executive officers, evaluates their performance, works with management in establishing business objectives and considers other fundamental corporate matters, such as the issuance of stock or other securities, the purchase or sale of a business and other significant corporate business transactions. In the fiscal year ended December 31, 2015, the Board met five times. During 2015, all Directors attended at least 75% of all meetings of the Board and meetings of committees of the Board. Our Board of Directors does not have a policy requiring directors to attend annual meetings of shareholders. All seven Board members attended our 2015 annual shareholder's meeting.

The Board of Directors has an Audit Committee consisting of Messrs. Attkisson and Brinck. Our Board has determined that each of the members of the Audit Committee meets the criteria for independence under the NASDAQ listing standards. The Audit Committee performs such duties as outlined in the Company's Audit Committee Charter. The Audit Committee reviews and acts or reports to the Board with respect to various auditing and accounting matters, the scope of the audit procedures and the results thereof, internal accounting and control systems of UTG, the nature of services performed for UTG and the fees to be paid to the independent auditors, the performance of UTG's independent and internal auditors and the accounting practices of UTG. The Audit Committee also recommends to the full Board of Directors the auditors to be appointed by the Board. The Audit Committee met four timesin 2015.

The Board has reviewed the qualifications of each member of the audit committee and determined one member of the committee, Randy Attkisson, meets the definition of an "audit committee financial expert" as defined in Item 407 of Regulation S-K.

The Board of Directors has a Compensation Committee consisting of Messrs. Dayton and Brinck. Our Board has determined that each of the members of the Compensation Committee meets the criteria for independence under the NASDAQ listing standards. The Compensation Committee performs such duties as outlined in the Company's Compensation Committee Charter. The Compensation Committee reviews and acts or reports to the Board with respect to various compensation matters relative to the Company's executive officers. The Compensation Committee has the authority to delegate appropriate matters to subcommittees as the Committee may determine in its discretion. The Compensation Committee met two times in 2015.

Under UTG's By-Laws, the Board of Directors should be comprised of at least six and no more than eleven Directors. At December 31, 2015, the Board consisted of eight Directors. Shareholders elect Directors to serve for a period of one year at UTG's annual shareholders' meeting.

The Board of Directors does not have a formal nominating committee, or a committee that performs similar functions, and does not have a nominating committee charter. The Board has concluded that the nominating process should not be limited to certain members so that a comprehensive selection of candidates can be considered. Therefore, the nomination process is conducted by the full Board of Directors. The Board of Directors has not adopted a formal policy with regard to the consideration of Director candidates recommended by shareholders. Candidates for nomination have been recommended by an executive officer or director, and considered by the Board of Directors. Generally, candidates have been persons who have been known to one or more of our Board members. The Board of Directors will, however, consider nominees recommended by shareholders. Shareholders wishing to recommend candidates for Board membership must submit the recommendations in writing to the Secretary of the Company at least 90 days prior to a date corresponding to the previous year's Annual Meeting, with the submitting shareholder's name and address and pertinent information about the proposed nominee similar to that set forth for nominees named herein. The Board does not evaluate potential nominees for director differently based on whether they are recommended by a shareholder.

The Board of Directors has not adopted specific minimum qualifications that it believes must be met by a person it recommends for nomination as a director. Proposed nominees will be considered in light of their potential contributions to the Board, their backgrounds, their independence and such other factors as the Board considers appropriate. We do not have a specific policy relating to the consideration of diversity in identifying director candidates. However, the Board of Directors does consider the diversity of our Board when identifying director candidates. The amount of consideration given to diversity varies with the Boards' determination of whether we would benefit from expanding the Board's diversity in a particular area. We believe this policy has been effective in identifying candidates with the diverse business experience necessary to lead our Company.

Our directors have demonstrated significant achievement and generally have significant management experience in one or more fields of business, professional, governmental, community or academic endeavors.  Our directors have sound judgement as a result of their management or policy making experience and demonstrate an ability to function effectively in an oversight role.  Given the tenure of most of the directors on our Board, they have a general appreciation regarding major issues facing the Company.  These experiences make each of our directors well qualified to be a member of the Company's Board of Directors.

The Board of Directors has provided a process for shareholders to send communications directly to the Board. These communications can be sent to James Rousey, President and Director of UTG, at the corporate headquarters at 5250 South Sixth Street, Springfield, Illinois 62703.

Our Board of Directors is led by Jesse Correll, our Chairman of the Board and Chief Executive Officer. The decision as to who should serve as Chairman of the Board, and who should serve as Chief Executive Officer, and whether those offices should be combined or separate, is properly the responsibility of our Board of Directors. The Board of Directors believes that the most effective leadership structure for us at this time is for Mr. Correll to serve as both Chairman of the Board and Chief Executive Officer. Our Board does not have a lead independent director and does not believe that designating a lead independent director would be necessary or helpful at this time.

Our Board of Directors oversees our risk management in cooperation with management. The Board and management regularly assess and communicate regarding risks confronting the Company, including transaction specific risks, macroeconomic trends, industry developments, and risk factors unique to our business. The members of the Audit Committee also discuss various financial reporting and accounting risk factors with our independent audit firm.

Section 16(a) Beneficial Ownership Reporting Compliance

Directors and officers of UTG file periodic reports regarding ownership of Company securities with the Securities and Exchange Commission pursuant to Section 16(a) of the Securities Exchange Act of 1934 as amended, and the rules promulgated there under.  UTG is not aware of any individuals who filed late with the Securities and Exchange Commission during 2015.  SEC filings may be viewed from the Company's Web site www.utgins.com.

Audit Committee Report to Shareholders

In connection with the December 31, 2015 financial statements, the audit committee: (1) reviewed and discussed the audited financial statements with Management; (2) discussed with the independent auditors the matters required by Statement on Auditing Standards No. 61, Communications with Audit Committees, as amended, (AICPA, Professional Standards, Vol. 1 AU section 380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T; and (3) received the written disclosures and the letter from its independent auditors required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent registered public accounting firm's communications with the audit committee concerning independence, and has discussed with the independent auditors their independence. Based upon these reviews and discussions, the audit committee recommended to the Board of Directors that the audited financial statements be included in the Annual Report on Form 10-K filed with the SEC for the last fiscal year.

Members of the Company's Audit Committee:

Randall L. Attkisson	Committee Chairman
Joseph A. Brinck, II

The following information with respect to business experience of the Board of Directors has been furnished by the respective Directors or obtained from the records of UTG.

Name, Age	Position with the Company, Business Experience and Other Directorships
Randall L. Attkisson, 70	Director of UTG since 1999; Director of First Southern Bancorp, Inc., a bank holding company, since 1986; Board Chairman of Metro Leadership Foundation since 2014; and Partner of Bluegrass Financial Holdings Subs/Affiliates since 2008.
Joseph A. Brinck, II, 60	Director of UTG since 2003; CEO of Stelter & Brinck, LTD, a full service combustion engineering and manufacturing company from 1983 to present; Salesman at Stelter & Brinck, LTD from 1979 to 1983; President of Superior Thermal, LTD from 1990 to present; President of Sanctity of Life Foundation since 2001 and Vice President of Ruah Woods Ministry since 2009. Currently holds Professional Engineering License in Kentucky.
Jesse T. Correll, 59	Chairman and CEO of UTG and Universal Guaranty Life Insurance Company since 2000; Director of UTG since 1999; Chairman, President, CEO of First Southern Bancorp, Inc. since 1988; Manager and President of First Southern Funding, LLC since 1992; President, Director of The River Foundation since 1990; Board member of Crown Financial Ministries from 2004 to 2009; Friends of the Good Samaritans since 2005; Generous Giving from 2006 to 2009 and the National Christian Foundation since 2006. Jesse Correll is the son of Ward and Regina Correll.
Ward F. Correll, 87	Director of UTG since 2000; President, Director of Tradeway, Inc. of Somerset, KY since 1973; Director of Cumberland Lake Shell, Inc. of Somerset, KY since 1971; President, Director of Tradewind Shopping Center, Inc. of Somerset, KY since 1966; Director of First Southern Bancorp since 1987; Director of First Southern Funding, LLC since 1991; Director of The River Foundation since 1990; and Director of First Southern Insurance Agency since 1987. Ward Correll is the father of Jesse Correll.
Brian J. Crall, 56	Director of UTG since 2015; Mr. Crall owns and is the President of foreClarity!, LLC. The Company was formed in 2012 and specializes in executive development, organizational development, strategic planning and public policy development. Mr. Crall also serves on the Board of Directors of MainSource Financial Group and from 2009 to 2012 Mr. Crall served as the Chief Executive Officer of CMD Holding, LLC, the holding company for CMD Health, Inc., a health insurance company and ClubMD, LLC, a series of primary care medical homes. From July 2008 to March 2009, Mr. Crall served as the Resource Director for the YMCA of the USA. Mr. Crall also served as the Personnel Cabinet Secretary for the Commonwealth of Kentucky from June 2006 to January 2007 and the Deputy Secretary of the Executive Cabinet, Office of the Governor of the Commonwealth of Kentucky from April 2004 to June 2006. During this time Mr. Crall served as a Director for the Kentucky Retirement System, a $15 billion retirement fund serving the employees of the state of Kentucky, and the Kentucky Deferred Compensation Authority, a $1.3 billion deferred compensation plan serving the employees of the Commonwealth of Kentucky. Additionally, Mr. Crall served as CEO of Progress Printing Company from July 2000 until April 2004, and was the 13th District State Representative in the state of Kentucky from January 1995 until April 2004.  Mr. Crall was CEO of the Owensboro Family YMCA from November 1986 through June 2000 and has been active in several civic and charitable organizations, including the Kentucky Youth Association, Habitat for Humanity, Owensboro Chamber of Commerce and the Fellowship of Christian Athletes.  Mr. Crall became a Director of UTG, Inc. in December 2015.
Howard L. Dayton, Jr., 72	In 1985, Mr. Dayton founded Crown Ministries in Longwood, Florida.  Crown Ministries merged with Christian Financial Concepts in September 2000 to form Crown Financial Ministries, the world's largest financial ministry.  He served as Chief Executive Officer from 1985 to 2007 and in 2009 founded Compass - Finances God's Way.  Mr. Dayton is a graduate of Cornell University.  He developed The Caboose, a successful railroad-themed restaurant in Orlando, FL in 1969. In 1972 he began his commercial real estate development career, specializing in office development in the Central Florida area.  He has authored five popular small group studies, produced several video series, and is the host for the nationally syndicated radio programs MoneyWise and HeyHoward.  Asbury University named their business school the Howard Dayton School of Business. Mr. Dayton became a Director of UTG, Inc. in December 2005.
Peter L. Ochs, 64	Mr. Ochs is founder of Capital III, a private equity investment firm located in Wichita, Kansas. Capital III provides impact investment capital and management with investments in manufacturing, real estate, energy, and education with a geographical focus on the US and Latin America. Prior to founding Capital III, Mr. Ochs spent 8 years in the commercial banking industry. Mr. Ochs graduated from the University of Kansas with a degree in business and finance. He currently serves on the boards of UTG, Inc., the American Independence Funds, and Trinity Academy.
James P. Rousey, 57	President of UTG and Universal Guaranty Life Insurance Company since September 2006; Director of UTG and Universal Guaranty Life Insurance Company since September 2001; Chair of ACLI Forum 500 since November 2015; Member of Board of Governors of ACLI since November 2014; Regional CEO and Director of First Southern National Bank from 1988 to 2001. Board Member with the Illinois Fellowship of Christian Athletes from 2001-2005; Board Member with Contact Ministries from 2007-2011; Board Member with Amigos En Cristo, Inc. from 2007-2009.

Executive Officers of UTG

More detailed information on the following executive officers of UTG appears under "Directors":

Jesse T. Correll	Chairman of the Board and Chief Executive Officer
James P. Rousey	President

Other executive officers of UTG are set forth below:

Name, Age	Position with UTG and Business Experience
Theodore C. Miller, 53	Corporate Secretary of UTG, Inc. and Universal Guaranty Life Insurance Company since December 2000; Senior Vice President and Chief Financial Officer since July 1997; Vice President since October 1992 and Treasurer from October 1992 to December 2003; Vice President and Controller of certain affiliated companies from 1984 to 1992; Vice President and Treasurer of certain affiliated companies from 1992 to 1997; Senior Vice President and Chief Financial Officer of subsidiary companies since 1997; Corporate Secretary of subsidiary companies since 2000.
Douglas P. Ditto, 60	Vice President of UTG, Inc. and Universal Guaranty Life Insurance Company since June 2009; Chief Investment Officer from 2009 to 2012; Assistant Vice President from June 2003 to June 2009; Chief Executive Officer, and Executive Vice President of First Southern Bancorp, Inc. since March 1985.

Code of Ethics

The company has adopted a Code of Business Conduct and Ethics for our Directors, officers (including our Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer or Controller, and persons performing similar function) and employees. The Code of Business Conduct and Ethics is available to our shareholder by requesting a free copy of the Code of Business Conduct and Ethics by writing to us as UTG, Inc., 5250 South Sixth Street, Springfield, Illinois 62703.

Item 11. Executive Compensation

Executive Compensation Table

The following table sets forth certain information regarding compensation paid to or earned by UTG's Chief Executive Officer and President, and each of UTG's two most highly compensated executive officers whose salary plus bonus exceeded $100,000 during UTG's last fiscal year:

Name and Principal position	Year	Salary	Bonus	Stock Awards (3)	All Other Compensation		Total
Jesse T. Correll Chief Executive Officer	2015	$175,000		$91,989	$7,269	(1)	$274,258
	2014	$175,000	0	0	$7,000	(1)	$182,000
James P. Rousey President	2015	$165,000	$92,000		$3,218	(2)	$260,218
	2014	$165,000	0	0	$2,475	(2)	$167,475
Douglas P. Ditto Vice President	2015	$120,000		$76,991	$4,985	(1)	$201,976
	2014	$120,000	0	0	$4,800	(1)	$124,800

(1)	All Other Compensation consists of matching contributions to an Employee Savings Trust 401(k) Plan.
(2)	All Other Compensation consists of matching contributions to an Employee Savings Trust 401(k) Plan of $3,218 and $2,475 during 2015 and 2014 respectively.
(3)	Stock awards in the form of an annual bonus of 12,517 shares were issued in 2015. No stock awards were issued in 2014.

Outstanding Equity Awards at Fiscal Year End

As of December 31, 2015, there were no unexercised options, stock that has not vested or equity incentive plan awards outstanding for any of the above named executive officers.

Compensation of Directors

Effective September 18, 2013 a new compensation arrangement was approved whereby each outside Director annually received $8,000 as a retainer and $1,000 per meeting attended. The compensation, however, is paid in UTG Common Stock. The value is determined annually on the close of business December 20th or the next business day should December 20^th be a weekend or holiday, based on the activity of the year just ending.  Reasonable travel expenses are reimbursed in cash as incurred.  UTG's Director compensation policy provides that Directors who are employees of UTG or its affiliates do not receive any compensation for their services as Directors except for reimbursement for reasonable travel expenses for attending each meeting.  The following table reflects compensation paid to all Directors who served in 2015.

Name	Fees Earned or Paid in Cash	Stock Awards (2)	All Other Compensation	Total
Jesse T. Correll Chief Executive Officer	$0			$0
James P. Rousey President	$0			$0
Randall L. Attkisson Director	$0	$12,996		$12,996
Joseph A. Brinck, II Director	$0	$11,000		$11,000
Ward F. Correll Director	$0	$9,995		$9,995
Brian J. Crall Director	$0	$2,987		$2,987
Peter L. Ochs Director	$0	$11,991		$11,991
Howard L. Dayton Director	$0	$11,991	$5,000 (1)	$16,991

(1) Other Compensation represents payment for consulting services performed relative to management enrichment.

(2) Market value of stock on earned date was $14.50 per share.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Principal Holders of Securities

The following tabulation sets forth the name and address of the entity known to be the beneficial owners of more than 5% of UTG's Common Stock and shows: (i) the total number of shares of Common Stock beneficially owned by such person as of February 19, 2016 and the nature of such ownership; and (ii) the percent of the issued and outstanding shares of Common Stock so owned as of the same date.

Title		Amount	Percent
of	Name and Address	and Nature of	Of
Class	of Beneficial Owner (2)	Beneficial Ownership	Class (1)

Common	Jesse T. Correll	115,692	(3)(6)	3.1%
Stock, no	First Southern Bancorp, Inc.	1,406,785	(3)(4)(6)	37.9%
par value	First Southern Funding, LLC	341,997	(3)(4)(6)	9.2%
	First Southern Holdings, LLC	1,201,876	(3)(4)(6)	32.3%
	Ward F. Correll	270,825	(5)(6)	7.3%
	WCorrell, Limited Partnership	72,750	(3)(6)	2.0%
	Cumberland Lake Shell, Inc.	257,501	(5)(6)	6.9%
	Eric L. Oliver	300,000	(7)	8.1%

(1)	The percentage of shares owned is based on 3,709,087 shares of Common Stock outstanding as of February 19, 2016.
(2)	The address for each of Jesse Correll, First Southern Bancorp, Inc. ("FSBI"), First Southern Funding, LLC ("FSF"), First Southern Holdings, LLC ("FSH"), and WCorrell, Limited Partnership ("WCorrell LP"), is 205 North Depot Street, Stanford, Kentucky 40484. The address for each of Ward F. Correll and Cumberland Lake Shell, Inc. ("CLS") is P.O. Box 430, 150 Railroad Drive, Somerset, Kentucky 42502. The address for Eric L. Oliver is 400 Pine Street, Suite 1010, Abilene, Texas 79601.
(3)	The share ownership of Jesse Correll listed includes 42,942 shares of Common Stock owned by him individually. The share ownership of Mr. Correll also includes 72,750 shares of Common Stock held by WCorrell, Limited Partnership, a limited partnership in which Jesse Correll serves as managing general partner and as such, has sole voting and dispositive power over the shares held by the entity.
	In addition, by virtue of his ownership of voting securities of FSF and FSBI, and in turn, their ownership of 100% of the outstanding membership interests of FSH, Jesse Correll may be deemed to beneficially own the total number of shares of Common Stock owned by FSH (as well as the shares owned by FSBI and FSF directly), and may be deemed to share with FSH (as well as FSBI and FSF directly) the right to vote and to dispose of such shares. Mr. Correll owns approximately 75.70% of the outstanding membership interests of FSF; he owns directly approximately 46.99%, companies he controls own approximately 14.08%, and he has the power to vote but does not own an additional 2% of the outstanding voting stock of FSBI. FSBI and FSF in turn own 99% and 1%, respectively, of the outstanding membership interests of FSH.
(4)	The share ownership of FSBI consists of 204,909 shares of Common Stock held by FSBI directly and 1,201,876 shares of Common Stock held by FSH of which FSBI is a 99% member and FSF is a 1% member. As a result, FSBI may be deemed to share the voting and dispositive power over the shares held by FSH.
(5)	Includes 257,501 shares of Common Stock held by CLS, all of the outstanding voting shares of which are owned by Ward F. Correll.
(6)	According to the Schedule 13D, as amended, filed November 17, 2014, Jesse Correll, FSBI, FSF and FSH, have agreed in principle to act together for the purpose of acquiring or holding equity securities of UTG. In addition, the Schedule 13D indicates that because of their relationships with Jesse Correll and these other entities, Ward Correll, CLS and WCorrell, Limited Partnership may also be deemed to be members of this group. Because the Schedule 13D indicates that for its purposes, each of these entities and persons may be deemed to have acquired beneficial ownership of the equity securities of UTG beneficially owned by the other entities and persons, each has been identified and listed in the above tabulation.
(7)	Shares held in entities controlled by Eric Oliver according to the Schedule 13G filed September 5, 2012.

Security Ownership of Management of UTG

The following tabulation shows with respect to each of the Directors of UTG, UTG's Chief Executive Officer and President, and each of UTG's two most highly compensated executive officers whose salary plus bonus exceeded $100,000 for fiscal 2015, and with respect to all executive officers and Directors of UTG as a group: (i) the total number of shares of Common Stock beneficially owned by such person as of February 19, 2016 and the nature of such ownership; and (ii) the percent of the issued and outstanding shares of stock so owned as of the same date.

Title of	Name and Address of	Amount and Nature of	Percent of
Class	Beneficial Owner	Beneficial Ownership	Class (1)

UTG's	Randall L. Attkisson	Louisville, KY	2,290		*
Common	Joseph A. Brinck, II	Cincinnati, OH	14,376		*
Stock, no	Jesse T. Correll	Stanford, KY	1,864,474	(2)	50.3%
par value	Ward F. Correll	Somerset, KY	270,825	(3)	7.3%
	Brian J. Crall	Nicholasville, KY	633	(4)	*
	Howard L. Dayton, Jr.	Sanford, FL	6,295		*
	Douglas P. Ditto	Danville, KY	16,134	(5)	*
	Theodore C. Miller	Springfield, IL	12,292		*
	Peter L. Ochs	Valley Center, KS	4,058	(6)	*
	James P. Rousey	Hustonville, KY	7,276		*
	All Directors and executive officers as a group (ten in number)		2,198,653		59.3%

* Less than 1%

(1)	The percentage of outstanding shares for UTG is based on 3,709,087 shares of Common Stock outstanding as of February 19, 2016.
(2)	The share ownership of Mr. Jesse Correll includes 42,942 shares of Common Stock owned by him individually, 204,909 shares of Common Stock held by FSBI and 341,997 shares of Common Stock owned by FSF. The share ownership of Mr. Correll also includes 72,750 shares of Common Stock held by WCorrell, Limited Partnership, a limited partnership in which Mr. Correll serves as managing general partner. Mr. Correll has sole voting and dispositive power over the shares held by these entities. In addition, by virtue of his ownership of voting securities of FSF and FSBI, and in turn, their ownership of 100% of the outstanding membership interests of FSH (the holder of 1,201,876 shares of Common Stock), Mr. Correll may be deemed to beneficially own the total number of shares of Common Stock owned by FSH, and may be deemed to share with FSH the right to vote and to dispose of such shares. Mr. Correll owns approximately 75.5% of the outstanding membership interests of FSF; he owns directly approximately 47.0%, companies he controls own approximately 14.1%, and he has the power to vote but does not own an additional 2% of the outstanding voting stock of FSBI. FSBI and FSF in turn own 99% and 1%, respectively, of the outstanding membership interests of FSH.
(3)	The share ownership of Mr. Correll includes 13,324 shares of Common Stock owned by him individually and 257,501 shares of Common Stock owned by Cumberland Lake Shell, Inc., all of the outstanding voting shares of which are owned by Ward F. Correll. Ward F. Correll is the father of Jesse T. Correll.
(4)	Includes 425 shares held in spouse's IRA.
(5)	Includes 1,600 shares held in a retirement account.
(6)	Includes 2,000 shares held in a trust for benefit of named individual.

Except as indicated above, the foregoing persons hold sole voting and investment power.

Item 13. Certain Relationships and Related Transactions and Director Independence

The Board of Directors determined that four of the eight current Directors are "independent" as defined by Rule 5605 of the NASDAQ listing standards. The independent Directors are Randall L. Attkisson, Joseph A. Brinck, II, Howard L. Dayton, Jr., and Peter L. Ochs.

On February 20, 2003, UG purchased $4,000,000 of a trust preferred security offering issued by First Southern Bancorp, Inc. ("FSBI"). The security has a mandatory redemption after 30 years with a call provision after 5 years. The security pays a quarterly dividend at a fixed rate of 6.515%. The Company received dividends of $264,219 during 2015 and 2014. On March 30, 2009, UG purchased $1,000,000 of FSBI common stock. The sale and transfer of this security is restricted by the provisions of a stock restriction and buy-sell agreement.

On September 28, 2011 UTG entered a joint ownership agreement with Bandyco, LLC and First Southern National Bank, for an 8.08% interest in an aircraft. Bandyco, LLC is affiliated with Ward F Correll, who is a Director of the Company. The Company paid a monthly operational fee of $25,000 through July of 2014 when the aircraft was sold. During July of 2014, the Company acquired a different aircraft. UTG paid $1,600,000 in the acquisition of the aircraft, increasing the Company's ownership interest to 30.1%. The aircraft is used for business related travel by various officers and employees of the Company. For years 2015 and 2014, UTG paid $255,920 and $879,453 for costs associated with the aircraft, respectively.

The Company from time to time acquires mortgage loans through participation agreements with FSNB. FSNB services the Company's mortgage loans including those covered by the participation agreements. The Company pays a .25% servicing fee on these loans and a one-time fee at loan origination of .50% of the original loan cost to cover costs incurred by FSNB relating to the processing and establishment of the loan. The Company paid $11,622 and $33,894 in servicing fees and $25,000 and $0 in origination fees to FSNB during 2015 and 2014, respectively.

The Company reimbursed expenses incurred by employees of FSNB relating to salaries, travel and other costs incurred on behalf of or relating to the Company. The Company paid $324,918 and $325,479 in 2015 and 2014, respectively to FSNB in reimbursement of such costs. In addition, the Company reimburses FSNB a portion of salaries and pension costs for Mr. Correll and Mr. Ditto. The reimbursement was approved by the UTG Board of Directors and totaled $349,351 and $332,725 in 2015 and 2014, respectively, which included salaries and other benefits.

As previously disclosed in the Notes Receivable section of Note 2 – Investments, several of the Company's notes have participation agreements in place with third parties.  Certain participation agreements are with FSF, a related party.  The participation agreements are sold without recourse and assigned to the participant based on their pro-rata share of the principal, interest and collateral as specified in the participation agreements. The undivided participations in the notes receivable range from 20% - 50%.  The total amount of loans participated to FSF were $3,170,000 and $0 as of December 31, 2015 and 2014, respectively. One of the participated notes receivable was fully repaid during the first quarter of 2016 reducing the outstanding participating notes receivable balance with FSF to $670,000.

Item 14. Principal Accounting Fees and Services

The Audit Committee is required to be directly responsible for the appointment, compensation and retention of the Company's independent registered public accounting firm. The Audit Committee appointed Brown Smith Wallace, LLC ("BSW") as the Company's independent registered public accounting firm for the fiscal years ended December 31, 2015 and 2014.

Amounts paid to, or billed by, the Company's principal accountant, during the two most recent fiscal years by category were as follows:

Audit Fees - Audit fees paid for these audit services in the fiscal years ended December 31, 2015 and 2014 totaled $114,000 and $115,750, respectively. Fees billed for the quarterly reviews of the Company's financial statements totaled $22,147 and $20,400 for the years 2015 and 2014, respectively.

Audit Related Fees - No audit related fees were incurred by the Company from BSW for the years ended December 31, 2015 and 2014.

Tax Fees – For the years ended December 31, 2015 and 2014, the Company paid $11,740 and $11,000, respectively, to BSW relating to certain tax advice and electronic filing of certain federal and state income tax returns of the Company.

All Other Fees – During 2015, the Company paid fees of $4,000 to BSW for services rendered in relation to the Ohio Department of Insurance examination of UG. The Company paid no other fees to BSW for other services for the year ended December 31, 2014.

PART IV

Item 15. Exhibits and Financial Statement Schedules

(a) The following documents are filed as a part of the report:

(1)	Financial Statements:
	See Item 8, Index to Financial Statements
(2)	Financial Statement Schedules
	NOTE: The financial statement schedules have been omitted as they are deemed inapplicable or not required by Regulation S-X.

(b) Exhibits: The following are exhibits to this report, and if incorporated by reference, we have indicated the document previously filed with the SEC in which the exhibit was included:

Exhibit Number	Description
3.1	Certificate of Incorporation of the Registrant and all amendments thereto [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 3.1]
3.2	By-Laws for the Registrant and all amendments thereto [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 3.2]
4.1	UTG's Agreement pursuant to Item 601(b) (4) (iii) (A) of Regulation S-K with respect to long-term debt instruments [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 4.1]
*10.2	Amendment to Reinsurance Agreement between Universal Guaranty Life Insurance Company and Optimum Re Insurance Company originally with Business Men's Assurance Company of America.
*10.3	Reinsurance Agreement between Universal Guaranty Life Insurance Company and Swiss RE originally with Life Reassurance Corporation of America.
*10.4	Assumption Reinsurance Agreement between Universal Guaranty Life Insurance Company and Park Avenue Life Insurance Company formerly known as First International Life Insurance Company.
10.5	Aircraft Lease Agreement [Incorporated by reference to the Registrant's Form 10-K, for the year ended December 31, 2010 originally filed as Exhibit 10.14].
10.7	StoneRiver Master Agreement [Incorporated by reference to the Registrant's Form 10-K, for the year ended December 31, 2011 originally filed as Exhibit 10.18].
10.9	Commercial pledge agreement dated November 20, 2012, between UTG, Inc. and Illinois National Bank. [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2012 originally filed as Exhibit 10.20]
10.10	Promissory Note dated March 4, 2013, between HPG Acquisitions, LLC and First National Bank of Tennessee [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2012 originally filed as Exhibit 10.21]
10.11	Administrative Services and Cost Sharing Agreement dated as of January 1, 2007 between UTG, Inc. and Universal Guaranty Life Insurance Company [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 10.11]
10.12	Agreement regarding Mortgage Loans by and between First Southern National Bank and Universal Guaranty Life Insurance Company [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 10.12]
10.13	Universal Guaranty Participation Agreement-Purchased Loan [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 10.13]
10.14	Universal Guaranty Participation Agreement-Originated Loan [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 10.14]
10.15	Line of Credit dated March 28, 2013, between UTG Avalon, LLC and First Southern Funding [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 10.15]
10.16	Management Data, Inc. Software License Agreement [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2015].
10.17	Note dated December 29, 2014, between UTG Avalon, LLC and First National Bank of Tennessee [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2015].
10.18	Aircraft Joint Ownership Agreement by and among Bandyco, LLC, First Southern National Bank and UTG, Inc. dated August 11, 2014 [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2015].
*10.19	Promissory Note dated November 20, 21015, between UTG, Inc. and Illinois National Bank.
14.1	Code of Ethics and Business Conduct [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 14.1]
14.2	Code of Ethical Conduct for Senior Financial Officers [Incorporated by reference to the Registrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 14.2]
*21.1	List of Subsidiaries of the Registrant.
*31.1	Certificate 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	Certificate 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
*99.1	Audit Committee Charter.
99.2	Whistleblower Policy [Incorporated by reference to theRegistrant's form 10-K, for the year ended December 31, 2013 originally filed as Exhibit 99.2].
*99.3	Compensation Committee Charter.
*99.4	Investment Committee Charter.
*101	Interactive Data File

* Filed herewith

SIGNATURES

Pursuant to the requirements of Section 13 or 15(D) of the Securities Exchange Act of 1934, UTG, Inc. has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

				UTG, Inc.
By:				/s/ Jesse T. Correll
				Jesse T. Correll
		Chairman and Chief Executive Officer and Director
By:				/s/ Theodore C. Miller
				Theodore C. Miller
	Senior Vice President, Chief Financial Officer and Secretary
			(principal financial and accounting officer)

Date: March 25, 2016

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By: /s/ Randall L. Attkisson	By: /s/ Howard L. Dayton
Randall L. Attkisson Director	Howard L. Dayton Director
By: /s/ Joseph A. Brinck	By: /s/ Peter L. Ochs
Joseph A. Brinck Director	Peter L. Ochs Director
By: /s/ Jesse T. Correll	By: /s/ James P. Rousey
Jesse T. Correll Chairman of the Board, Chief Executive Officer and Director	James P. Rousey President and Director
By:	By: /s/ Theodore C. Miller
Ward F. Correll Director	Theodore C. Miller Corporate Secretary and Chief Financial Officer
By: /s/ Brian J. Crall
Brian J. Crall Director

EX-10.2

Exhibit 10.2

AMENDMENT TO

REINSURANCE AGREEMENT

DATED:     December 1, 1993

between

UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

5250 South Sixth Street

Springfield, Illinois  62705

(The Ceding Company)

and

OPTIMUM RE INSURANCE COMPANY

1345 River Bend Drive, Suite 100

Dallas, TX  75247

(The Reinsurer)

Respecting the Net Amount at Risk

1.  Effective December 1, 1993, the Net Amount at Risk (NAR) for the policies reinsured under this Agreement shall be calculated on a Level basis (Reinsured NAR Amount is equal to the Policy Death Benefit minus the Company's retention).  Both parties mutually agree any modifications to the NAR calculation for policies reinsured under this Agreement shall be done prospectively.

2.  Signatures     :  The terms and conditions of this Agreement are not changed in    any way except as stated herein.

In witness of the above, this Amendment is signed in duplicate at the dates and places indicated.

FOR     :     UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

DATE:	11/18/10	SIGNATURE:	/s/Theodore C Miller
PLACE:	Springfield, IL	NAME:	Theodore C Miller
WITNESS:	/s/Fritzie Wagner	TITLE:	Accounting Manager

FOR     :     OPTIMUM RE INSURANCE COMPANY

DATE:	10/22/10	SIGNATURE:	/s/Mario Georgiev
PLACE:	DALLAS, TEXAS	NAME:	MARIO GEORGIEV
WITNESS:	/s/Jean-Claude Page	TITLE:	PRESIDENT

ADDENDUM

to the Automatic YRT Pool Agreement

dated December 1, 1993

between

UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

Springfield, Illinois

(hereinafter called the CEDING COMPANY)

and

BUSINESS MEN'S ASSURANCE COMPANY OF AMERICA

Kansas City, Missouri

(hereinafter called the BMA)

Purpose:     To include coverage for the C21X plan under this agreement.

1.	BMA shall accept reinsurance covering the C21X plan (L019585A) on either an automatic or facultative basis
2.	BMA will not participate in the endowments, or the return of premium features, nor the cash values.
3.	THE EFFECTIVE DATE shall be November 1, 1995.

Except as herein amended, the provisions of the said Reinsurance Agreement shall remain unchanged.

IN WITNESS WHEREOF, this addendum is hereby executed in duplicate between the parties concerned, and is duly signed by both parties respective officers as follows:

CEDING COMPANY
/s/Gay E Sears		Senior Vice President
signature		title
/s/Christopher J Heisler		Assistant Vice President
signature		title
	11/27/95
	date

BMA
/s/Al Rodriquez		Senior Vice President/Reinsurance
signature		title
/s/James N. Mets		Vice President Reinsurance Actuary
signature		title
	12/21/95
	date

BMA

REINSURANCE AGREEMENT

between

UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

Springfield, Illinois

hereinafter referred to as the CEDING COMPANY

and

Business Men's Assurance Company of America

Kansas City, Missouri

hereinafter referred to as BMA

AUTOMATIC TREATY

TABLE OF CONTENTS

ARTICLE     …………………………………………………………………………….……….PAGE

I	BASIS OF REINSURANCE……………………………..…………………………	1
II	LIABILITY………………………………………………………………………….	3
III	ADMINISTRATIVE REPORTING……………………...…………………………	3
IV	PLANS OF REINSURANCE…………………………….…………………………	5
V	REINSURANCE PREMIUM…………………………….…………………………	5
VI	PREMIUM ACCOUNTING………………………………..………………………	6
VII	OVERSIGHTS………………………………………………………………………	7
VIII	REDUCTIONS, TERMINATIONS AND CHANGES….…………………………	7
IX	INCREASE IN RETENTION AND RECAPTURES………………………………	8
X	REINSTATEMENTS…………………………………….…………………………	9
XI	EXPENSE OF ORIGINAL POLICY…………………….…………………………	9
XII	CLAIMS………………………………………………….…………………………	9
XIII	TAX CREDITS…………………………………………..…………………………	11
XIII	DAC TAX………………………………………………...…………………………	11
XIV	INSPECTION OF RECORDS………………………………………………………	11
XV	INSOLVENCY………………………………………………………………………	11
XVI	ARBITRATION…………………………………………..…………………………	12
XVII	PARTIES TO AGREEMENT…………………………….…………………………	13
XVIII	TERMINATION OF AGREEMENT……………………..…………………………	13

SCHEDULES
A	SPECIFICATIONS
B	BENEFITS AND NAR CALCULATIONS
C	ADDITIONAL INFORMATION AND EXCEPTIONS

EXHIBITS
I	RETENTION LIMITS
IA	UNDERWRITING GUIDELINES
II	REINSURANCE PREMIUMS
III	COMMISSIONS AND ALLOWANCES (COINSURANCE)

ARTICLE I

BASIS OF REINSURANCE

Reinsurance under this agreement must be individual insurance.  The CEDING COMPANY shall automatically reinsure the life insurance for the plan(s) as stated in Schedule A and any additional benefits listed in Schedule B.

1.	REQUIREMENTS FOR AUTOMATIC REINSURANCE
	A.	The individual risk must be a permanent resident of the United States or Canada.
	B.	The individual risk must be underwritten by the CEDING COMPANY according to the standard underwriting practices and guidelines as shown in Exhibit IA.  The CEDING COMPANY shall immediately notify BMA of any changes in underwriting practices or guidelines.  Any risk falling into a category of special underwriting programs shall be excluded from this Agreement.
	C.	Any risk offered on a facultative basis to BMA or any other reinsurer shall not qualify for automatic reinsurance.
	D.	The maximum issue age on any risk shall be age 70.  Issue ages over 70 must be submitted facultatively.
	E.	The mortality rating on any one risk must not exceed Table 8, or 300%, or its equivalent on a flat extra premium basis.  Cases exceeding Table 8, or 300%, or its equivalent must be submitted facultatively.
	F.	The maximum amount of insurance issued and applied for in all companies on any one risk shall not exceed the Jumbo limits as stated in Schedule A.
	G.	On any risk, the CEDING COMPANY must retain the amounts of insurance as stated in Exhibit I.
	H.	The maximum amounts of insurance to be reinsured on any one life shall not exceed the automatic binding limits as stated in Schedule A.
	I.	The minimum amount of insurance to be ceded shall be $5,000.
2.	REQUIREMENTS FOR FACULTATIVE REINSURANCE
	A.	Plan of Insurance Listed in Schedule A:
		(1)	If the Requirements for Automatic Reinsurance are met but the CEDING COMPANY prefers to apply for facultative reinsurance, or
		(2)	If Requirements for Automatic Reinsurance are not met then the CEDING COMPANY must submit to BMA all the underwriting documentation relating to the insurability of the individual risk for facultative reinsurance.
	B.	Plan of Insurance Not Listed in Schedule A:
		On a Yearly Renewable Term treaty the CEDING COMPANY may submit an application for facultative reinsurance on any plan(s).
		On a Coinsurance treaty the Ceding Company cannot submit an application for facultative reinsurance on plan(s) other than the plan(s) listed in Schedule A.
	C.	An application for facultative reinsurance may include life insurance with or without either disability waiver of premium or accidental death or both.  Only accidental death reinsurance may be submitted without an application for life insurance.
	D.	Copies of all underwriting papers relating to the insurability of the individual risk must be sent to BMA for facultative reinsurance.  After BMA has examined the underwriting papers, BMA will promptly notify the CEDING COMPANY of the underwriting offer subject to additional requirements, the final underwriting offer or declination.  Any final underwriting offer on the individual risk will automatically terminate upon the earliest of:
		(1)	The date BMA receives notice of a withdrawal/cancellation by the CEDING COMPANY,
		(2)	120 days after the date on which the offer was made, or
		(3)	The date specified in BMA's approval to extend the offer.
	E.	The minimum amount of insurance to be ceded shall be $5,000.

ARTICLE II

LIABILITY

1.	BMA's liability for automatic reinsurance shall begin simultaneously with the CEDING COMPANY's liability.
2.	Except for additional coverage pertaining to conditional receipt as described in Schedule C, BMA's liability for facultative reinsurance on individual risks shall not begin unless and until the CEDING COMPANY has accepted BMA's final and unconditional written offer on the application for facultative reinsurance.
3.	BMA's liability for reinsurance on individual risks shall terminate when the CEDING COMPANY's liability terminates.
4.	As long as the original policy remains in full force, all paid-up additions and accumulated dividends shall be the liability of the CEDING COMPANY.
5.	In no event shall reinsurance under this Agreement be in force unless the insurance issued directly by the CEDING COMPANY is in force and is issued and delivered in a jurisdiction in which the CEDING COMPANY is properly licensed.
6.	The payment of reinsurance premiums in accordance with this Agreement shall be a condition precedent to the liability of BMA under reinsurance covered by this Agreement.

ARTICLE III

ADMINISTRATIVE REPORTING

1.	Self-Administered Business
	Promptly after liability for insurance has begun on an individual risk, the CEDING COMPANY shall have the responsibility of maintaining adequate records for the administration of the reinsurance account and shall furnish BMA with monthly reports, in substantial conformity with the following:
A.	MONTHLY NEW BUSINESS REPORT

(1) policy number	(10) amount reinsured
(2) full name of insured	(11) automatic/facultative indicator
(3) date of birth	(12) state of residence
(4) sex	(13) table rating
(5) issue age	(14) flat extra (amount + number of years)
(6) policy date	(15) death benefit option (UL products)
(7) underwriting  classification	(16) net amount at risk
(8) plan of insurance	(17) transaction code
(9) amount issued	(18) currently if other than U.S.

B.	MONTHLY CONVERSION REPORT
	The CEDING COMPANY shall furnish BMA with a separate listing of reinsurance policies that are conversions or replacements to the plan(s) as stated in Schedule A. The listing should provide the following information:

(1)     1 through 18 in 1.A above	(4)     attained age
(2)     original policy date	(5)     duration
(3)     original policy number	(6)     effective date if other than policy date

C.	MONTHLY PREMIUM REPORT
	At the end of each month the CEDING COMPANY shall send to BMA a listing of all reinsurance policies issued or renewing during the past month accompanied by the reinsurance premiums for such policies.  The listing should be segregated into first year issues and renewals and should provide the following information:

(1)     1 through 18 in 1.A above

(2)     current net amount at risk

(3)     On Yearly Renewable Term treaties the net reinsurance premium due for each reinsured policy with the premium for life and each supplemental benefit separated.

(4)     On Coinsurance treaties the gross reinsurance premium, commissions, net reinsurance premium and other amounts (e.g. dividends, cash surrender values) with premium separated for life and each supplemental benefit.

	All monthly lists shall be submitted to BMA no later than the 20th day of the following month.
D.	MONTHLY CHANGE REPORT
	The CEDING COMPANY shall report the details of all policy terminations and changes on the reinsured policies.  In addition to the data indicated in 1.A, above, the report should provide information about the nature, the effective date, and the financial result of the change with respect to reinsurance.
E.	MONTHLY POLICY EXHIBIT REPORT
	The CEDING COMPANY shall provide a summary of new issues, terminations, recaptures, changes, death claims and reinstatements during the month and the inforce reinsurance at the end of the month.
F.	QUARTERLY REPORTING
	1.	Within ten (10) days following the end of the quarter, the CEDING COMPANY shall provide BMA with Premiums Due and Unpaid.  This report may be in summary form reporting totals by line of business with separate totals for first year and renewals.
	2.	Within ten (10) days following the end of the quarter, the CEDING COMPANY shall provide BMA with totals for the reserve liability including statutory reserves by valuation basis segregated by Yearly Renewable Term and Coinsurance.
G.	ANNUAL INFORCE LISTING
	Within ten (10) days after the close of the year, the CEDING COMPANY shall furnish BMA a listing of reinsurance in force by policy, by year of issue, segregated by Yearly Renewable Term and Coinsurance and include statutory reserves for the same.
H.	CLAIMS
	Claims shall be reported as incurred on an individual basis.
2.	Individual Cession Business
	Promptly after liability for reinsurance has begun on the individual risk the CEDING COMPANY shall send BMA a "Reinsurance Cession".  Based on the information on the "Reinsurance Cession", BMA will prepare and send the CEDING COMPANY a "Reinsurance Cession Card".  When reinsurance is reduced or changed the CEDING COMPANY shall send BMA an "Amended Reinsurance Cession".

ARTICLE IV

PLANS OF REINSURANCE

1.	Life reinsurance shall be ceded on the basis stated in Schedule A.
2.	Copies of all life insurance policies, riders, rate manuals, benefit forms, commuted value tables and cash value tables shall be provided by the CEDING COMPANY to BMA, and BMA shall be promptly notified of any changes therein.

ARTICLE V

REINSURANCE PREMIUMS

1.	Life Reinsurance Premiums
	A.	Life Reinsurance Premiums Paid on a Coinsurance Basis
	The CEDING COMPANY shall pay the current premium as shown in Exhibit II based on the amount of life insurance reinsured, less the allowance stated in Exhibit III. In addition, the CEDING COMPANY shall pay any substandard table extra and flat extra premiums, but shall exclude the policy fee.  In the event the current premium is changed, BMA shall be notified by the CEDING COMPANY immediately.
	B.	Life Reinsurance Premiums on a Yearly Renewable Term Basis
	The life reinsurance premium on the net amount at risk shall be based on rates shown in Exhibit II.
	For those premiums less than the net premium rate or rates based on the 1980 CSO Table at 4 ½% interest, only the latter rate or rates shall be guaranteed.  Should BMA increase the reinsurance premiums to the 1980 CSO Table at 4 ½% interest, then the CEDING COMPANY shall have the right to immediately recapture any business affected by that change.

ARTICLE VI

PREMIUM ACCOUNTING

1.	Payment of Reinsurance Premium.
	A.	The reinsurance premiums shall be paid to BMA using the rates shown in Exhibit II.
	B.	On issues ceded by individual cessions BMA shall send the CEDING COMPANY each month two copies of a statement listing first year and renewal reinsurance premiums less refunds and allowances which are due during the current month.
	C.	On self-administered business the CEDING COMPANY shall provide the statement to BMA using the format described in Article III Self-Administered Business.
	D.	If a net reinsurance premium balance is payable to BMA the CEDING COMPANY shall pay this balance within forty-five (45) days after the close of that month.  If the full balance is not received within the forty-five (45) day period, the reinsurance premiums for reinsurance risks listed on the statement, for which payment was not received, shall be delinquent and the liability of BMA shall cease as of the date reinsurance premium were due.
	E.	If a net reinsurance premium balance is payable to the CEDING COMPANY, BMA shall pay this net balance within forty-five (45) days after the monthly statement was sent to the CEDING COMPANY.  If the monthly statement has not been returned within forty-five (45) days, BMA shall assume the CEDING COMPANY has verified and is in agreement with the net balance and shall make payment to the CEDING COMPANY.
2.	Currency.
	The reinsurance premiums and benefits payable under this Agreement shall be payable in the lawful money of the United States or Canada.

ARTICLE VII

OVERSIGHTS

If there is an unintentional oversight or clerical error in the administration of this Agreement by either the CEDING COMPANY or BMA, it can be corrected provided the correction takes place promptly after the time the oversight or clerical error is first discovered.  In that event, the CEDING COMPANY and BMA will be restored to the position they would have occupied had such oversight or clerical error not occurred.

ARTICLE VIII

REDUCTIONS, TERMINATIONS AND CHANGES

1.	A.	If in accordance with policy provisions the original policy is converted to permanent life insurance, the life risk under the converted policy which exceeds the amount of risk originally retained by the CEDING COMPANY shall continue to be reinsured with BMA.
	B.	If there is a replacement where full underwriting evidence is not required according to the CEDING COMPANY regular underwriting rules, the life risk which exceeds the amount of risk originally retained by the CEDING COMPANY shall continue to be reinsured with BMA.
	C.	If there is a replacement where full underwriting evidence is required by the CEDING COMPANY, reinsurance may be ceded to BMA subject to a written agreement between BMA and the CEDING COMPANY.
2.	If the amount of insurance under a policy or rider reinsured under the Agreement increases and
	A.	The increase is subject to new underwriting evidence, the provisions of Article I shall apply to the increase in reinsurance.
	B.	The increase is not subject to new underwriting evidence, BMA shall accept automatically the increase in reinsurance but not to exceed the automatic binding limit as stated in Schedule A.
3.	If the amount of insurance under a policy or rider reinsured under this Agreement is increased or reduced, any increase or reduction in reinsurance for the risk involved shall be effective on the effective date of the increase or reduction in the amount of insurance.
4.	If any portion of the prior insurance retained by the CEDING COMPANY on an individual life reduces or terminates, any reinsurance under this Agreement based on the same life shall also be reduced or terminated.  The CEDING COMPANY shall reduce its reinsurance by applying the retention limits which were in effect at the time the policy was issued.  The "reinsurance adjustment due to lapse or reduction of previous insurance" shall be effective on the same date as the lapse or reduction of prior insurance.  The reinsurance to be terminated or reduced shall be determined in chronological order by the date the risk was first reinsured.  Two or more policies issued the same date shall be considered one policy.
5.	If the insurance for a risk is shared by more than one reinsurer, BMA's percentage of the increased or reduced reinsurance shall be the same as BMA's percentage of initial reinsurance of the individual risk.
6.	If a risk reinsured under this Agreement is terminated, the reinsurance for that risk shall be terminated as of the effective date of the termination.
7.	For facultative reinsurance, if the CEDING COMPANY reduces the mortality rating, the reduction shall be subject to the facultative provisions of this Agreement as stated in Article I, Section 2.
8.	BMA shall refund all unearned reinsurance premiums not including policy fees, less applicable allowances, arising from reductions, terminations and changes as described in this Article.

ARTICLE IX

INCREASE IN RETENTION

AND RECAPTURES

1.	If the CEDING COMPANY changes its retention limits, as listed in Exhibit I, prompt written notice of the change shall be provided to BMA.
2.	The CEDING COMPANY shall have the option of recapturing the reinsurance under this Agreement in the event the CEDING COMPANY increases its retention limit and the policies have been in force the required length of time as stated in Schedule A.  The CEDING COMPANY may exercise its option to recapture by giving written notice to BMA within ninety (90) days after the effective date of the increase in retention.  If the recapture option is not exercised within ninety days (90) days after the effective date of the increase in retention the CEDING COMPANY may choose to recapture at a later date.  In that case, the date of the written notification to BMA shall determine the effective date the recapture program shall begin.
3.	If the CEDING COMPANY exercises its option to recapture, then:
	A.	The CEDING COMPANY shall reduce the reinsurance on all individual risks on which it retained its maximum retention for the age and mortality rating that was in effect at the time the reinsurance was ceded.
	B.	The CEDING COMPANY shall increase its total amount of insurance on the    individual risk up to its new retention by reducing the amount of reinsurance.  If an individual risk is shared by more than one reinsurer, BMA's percentage of the reduced reinsurance shall be the same as BMA's initial percentage of reinsurance on the individual risk.
	C.	The reduction of reinsurance shall become effective on the later of the following dates:
		(1)	The policy anniversary date immediately following the date the recapture program is to begin as determined by paragraph 2. of this Article;
		(2)	The number of years stated in Schedule A starting with the "policy date."
	D.	In the event the CEDING COMPANY overlooks any reduction in the amount of a reinsurance policy because of an increase in the CEDING COMPANY's retention, the acceptance by BMA of reinsurance premiums under these circumstances shall not constitute a liability on the part of BMA for such reinsurance.  BMA shall be liable only for a refund of premiums.
4.	No recapture shall be permitted for reinsurance on an individual risk if (a) the CEDING COMPANY retained less than its maximum retention for the age and mortality rating in effect at the time the reinsurance was ceded to BMA, or if (b) the CEDING COMPANY did not retain any of the individual risk.

ARTICLE X

REINSTATEMENT

If a policy reinsured under this Agreement lapses for nonpayment of premium or is continued on the Reduced Paid-up or Extended Term Insurance basis, and is reinstated in accordance with the terms of the policy and the CEDING COMPANY's rules, the reinsurance on such policy shall automatically be reinstated by BMA upon written notice of such reinstatement.  The CEDING COMPANY shall pay BMA all back reinsurance premiums.

ARTICLE XI

EXPENSE OF ORIGINAL POLICY

The CEDING COMPANY shall bear the expense of all medical examinations, inspection fees, and other charges in connection with the issuance of the insurance.

ARTICLE XII

CLAIMS

1.	The CEDING COMPANY shall give BMA prompt notice of any claim.  Copies of the proofs obtained by the CEDING COMPANY together with a statement showing the amount due or paid on such claim by the CEDING COMPANY shall be furnished to BMA at the time payment is requested.
2.	BMA shall accept the decision of the CEDING COMPANY in settling the claim and shall pay its portion to the CEDING COMPANY upon receipt of proof that the CEDING COMPANY has paid the claimant.  It is agreed, however, that if a lesser amount at risk is retained by the CEDING COMPANY than the amount ceded to BMA, the CEDING COMPANY shall consult with BMA concerning its investigation and/or payment of the claim, although the final decision shall be that of the CEDING COMPANY.
3.	The CEDING COMPANY shall notify BMA of its intention to contest, compromise, or litigate a claim involving reinsurance, and BMA shall pay its share of the payment and specific claim expenses therein involved, unless it declines to be a party to the contest, compromise, or litigation in which case it shall pay the full amount of the reinsurance to the CEDING COMPANY.  "Claim expenses" shall be deemed to mean only the reasonable legal and investigative expenses connected with the litigation or settlement of claims.  "Claim expenses" shall not include expenses incurred in connection with a dispute or contest arising out of conflicting claims or entitlement to policy proceeds which the CEDING COMPANY admits are payable or any routine claim administrative expenses, Home Office or otherwise.
4.	In the event the amount of insurance provided by a policy or policies reinsured hereunder is increased or reduced because of a misstatement of age or sex established after the death of the insured, BMA shall share in the increase or reduction in the proportion that the net liability of BMA bore to the sum of the retained net liability of the CEDING COMPANY and the net liability of other reinsurers immediately prior to such increase or reduction.  The reinsurance with BMA shall be written from commencement on the basis of the adjusted amounts using premiums and reserves at the correct ages and sex.  The adjustment for the difference in premiums shall be made without interest.
5.	It is understood and agreed that the payment of a death claim by BMA shall be made in one sum regardless of the mode of settlement under the policy of the CEDING COMPANY.
6.	In no event shall BMA have any liability for any Extra-Contractual damages which are assessed against the CEDING COMPANY as a result of acts, omissions or course of conduct committed by the CEDING COMPANY or its agents, other than a good faith decision to deny claim liability, in connection with insurance reinsured under this Agreement.  It is recognized that there may be special circumstances involved which indicate that BMA should participate in certain assessed damages.  These circumstances are not amendable to advance specific definition, but could include those situations in which BMA was an active party in the act, omission or course of conduct which ultimately results in the assessment of such damages.  The extent of such participation will be determined on a good faith assessment of culpability in each case, but all factors being equal, the division of any such assessment will generally be in the proportion of net liability borne by each party.
7.	If a claim is approved for disability waiver of premium insurance reinsured under this Agreement, the CEDING COMPANY shall continue to pay reinsurance premiums to BMA.  BMA shall reimburse the CEDING COMPANY BMA's share of the annual liability.

ARTICLE XIII

TAX CREDITS

In jurisdictions which impose premium taxes on the CEDING COMPANY without deduction for reinsurance, BMA shall reimburse the CEDING COMPANY for taxes paid on the amount of the reinsurance premiums on the basis shown in Schedule A, unless BMA itself is required to pay a direct tax on such reinsurance premiums.

ARTICLE XIV

DEFERRED ACQUISITION COSTS TAX

The CEDING COMPANY and BMA elect under Regulation 1.848-2(g) (8) to compute "specified policy acquisition expense", as defined in section 848(c) of the Internal Revenue Code, in the following manner:

The party with net positive consideration as determined under Reg. 1.848-2(f) and Reg. 1.848-3 shall compute specified policy acquisition expenses without regard to the general deductions limitation of section 848(c)(1) for each taxable year.

The parties will exchange information pertaining to the aggregate amount of net consideration as determined under Regs. 1.848-2(f) and 1.848-3, for all reinsurance agreements in force between them, to insure consistency for the purposes of computing specified policy acquisition expenses.  BMA shall provide the CEDING COMPANY with the amount of such net consideration for each taxable year no later than May 1 following the end of such year.  The CEDING COMPANY shall advise BMA if it disagrees with the amounts provided, and the parties agree to amicably resolve any difference.  The amounts provided by BMA shall be presumed correct if it does not receive a response from the CEDING COMPANY by May 31.

BMA represents and warrants that it is subject to U.S. taxation under Subchapter L of the Internal Revenue Code.

ARTICLE XV

INSPECTION OF RECORDS

BMA shall have the right, at any reasonable time, to inspect at the office of the CEDING COMPANY, all books and documents which relate to reinsurance under this Agreement.

ARTICLE XVI

INSOLVENCY

1.	In the event of insolvency of the CEDING COMPANY, all reinsurance shall be payable by BMA directly to the CEDING COMPANY or its liquidator, receiver, or statutory successor, on the basis of the liability of the CEDING COMPANY under the policy or policies reinsured, without diminution because of the insolvency of the CEDING COMPANY.
2.	It is agreed that the liquidator, receiver, or statutory successor of the insolvent CEDING COMPANY shall give written notice to BMA of the pending of a claim against the insolvent CEDING COMPANY on any policy reinsured within a reasonable time after such claim is filed in the insolvency proceedings.  During the pendency of any such claim BMA may investigate such claim and interpose, in the proceeding where such claim is to be adjudicated, any defense or defenses which BMA may deem available to the CEDING COMPANY or its liquidator, receiver, or statutory successor.  The expense thus incurred by BMA shall be chargeable, subject to court approval, against the insolvent CEDING COMPANY as part of the expense of liquidation to the extent of proportionate share of the benefit which may accrue to the CEDING COMPANY solely as a result of the defense undertaken by BMA.
3.	Where two or more reinsurers are participating in the same claim and a majority in interest elect to interpose a defense to such claim, the expense shall be apportioned in accordance with the terms of the Agreement as though such expenses had been incurred by the CEDING COMPANY.
4.	Any debts or credits, matured or unmatured, liquidated or unliquidated, in favor of or against either the CEDING COMPANY or BMA with respect to this agreement or with respect to any other claim of one party against the other are deemed mutual debts or credits, as the case may be, and shall be set off, and only the balance shall be allowed or paid.

ARTICLE XVII

ARBITRATION

1.	It is the intention of the CEDING COMPANY and BMA that the customs and practices of the insurance and reinsurance industry shall be given full effect in the operation and interpretation of this Agreement.  The parties agree to act in all things with the highest good faith.  However, if BMA and the CEDING COMPANY cannot mutually resolve a dispute or claim which arises out of or relates to this agreement, the dispute or claim shall be settled through arbitration.
2.	The arbitrators shall be impartial regarding the dispute, and shall base their decision on the terms and conditions of this agreement plus, as necessary, on the customs and practices of the insurance and reinsurance industry.
3.	There shall be three arbitrators who must be officers of life insurance companies other than the parties to this agreement or their subsidiaries.  Each of the parties to this agreement shall appoint one of the arbitrators and these two arbitrators shall select the third.  If a party to this agreement fails to appoint an arbitrator within thirty (30) days after the other party to this agreement has given notice of the arbitrator appointment, the American Arbitration Association shall appoint an arbitrator for the party to this Agreement that has failed to do so.  Should the two arbitrators be unable to agree on the choice of the third, then the appointment of this arbitrator is left to the American Arbitration Association.
4.	Except for the appointment of arbitrators in accordance with the provisions of Section 3 of this Article, arbitration shall be conducted in accordance with the Commercial Arbitration Rules of the American Arbitration Association which are in effect on the date of delivery of demand for arbitration.  Arbitration shall be conducted in Kansas City, Missouri.
5.	Each party to this agreement shall pay part of the arbitration expenses which are apportioned to it by the arbitrators.
6.	The award agreed by the arbitrators shall be final, and judgment may be entered upon it in any court having jurisdiction.

ARTICLE XVIII

PARTIES TO AGREEMENT

This is an Agreement of indemnity reinsurance solely between the CEDING COMPANY and BMA.  The acceptance of reinsurance under this Agreement shall not create any right or legal relation whatever between BMA and the insured, owner, or any other party to or under any policy reinsured under this Agreement.

ARTICLE XVIV

TERMINATION OF AGREEMENT

1.	This Agreement may be terminated at any time by either party giving at least ninety (90) days written notice of termination.  The day the notice is deposited in the mail addressed to the Home Office, or to an Officer of either company shall be the first day of the ninety-day (90) period.
2.	The CEDING COMPANY shall continue to cede reinsurance and BMA shall continue to accept reinsurance, as provided for by the terms of this Agreement, until the date of termination.
3.	All automatic reinsurance which became effective prior to the termination of this Agreement and all facultative reinsurance approved by BMA based upon applications received prior to termination of this Agreement shall remain in effect until its termination or expiration, unless the CEDING COMPANY and BMA mutually decide otherwise.

IN WITNESS WHEREOF, this agreement shall be effective with policies dated 12:01A.M. September 1, 1993 and is hereby executed in duplicate between

UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

Springfield, Illinois

referred to as the CEDING COMPANY

and

BUSINESS MEN'S ASSURANCE COMPANY OF AMERICA

Kansas City, Missouri

referred to as BMA,

and duly signed by both parties' respective officers as follows:

THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY THE PARTIES.

CEDING COMPANY
/s/James E Melville		President
signature		title
/s/George E Frances		Secretary
signature		title
	11/15/93
	date

BMA
/s/John Walker		Managing Director/Reinsurance
signature		title
/s/WM. Crouch		Reinsurance Administrative Vice President
signature		title
	11/24/93
	date

SCHEDULE

SPECIFICATIONS

1.	TYPE OF BUSINESS:
	Life insurance issued by the CEDING COMPANY.
2.	TYPE OF REPORTING
	Self-administered
3.	PLANS OF INSURANCE:
	Permanent Plans, Universal Life, and Riders Term Plans
4.	BASIS OF REINSURANCE:  Automatic Yearly Renewable Term
	SURNAME ALPHABETIC DIVISION:  A-Z
	QUOTA SHARE:  50%
5.	JUMBO LIMIT:
	A.	Life:  $10,000,000
	B.	Waiver of Premium:  $5,000,000
6.	BINDING LIMIT:
	A.	Life:  Five (5) times the retention of the CEDING COMPANY.
	B.	Waiver of Premium or Monthly Cost of Insurance:  Amounts equal to but not exceeding the amounts payable to the CEDING COMPANY for the amount of life reinsured with BMA.
7.	YEARS TO RECAPTURE:
	Ten (10) years
8.	PREMIUM TAX REIMBURSEMENT:
	BMA will not reimburse premium taxes.

SCHEDULE B

The following benefits are reinsured under this agreement:

1.	LIFE
	A.	Level Term Plans (twenty years or less) – The net amount at risk shall be the reinsurance face amount ceded.
	B.	Level Term Plans (more than twenty years) or Permanent Plans -
		1st Year – Full amount ceded
		2nd through 10th Years – Annual decrement is equal to one-tenth of the 10th year Cash Value.
		11th through 20th Years – Annual decrement is equal to one-tenth of the difference between the 10th year and the 20th year Cash Value.
		Subsequent years calculated in a similar manner.
	C.	Decreasing Term Plans – The first net amount at risk will be the reinsurance face amount ceded.  Subsequent years will be determined from the commuted values schedule provided by the CEDING COMPANY.
	D.	Universal Life Plans – The CEDING COMPANY shall furnish BMA the net amount at risk on a self-administered report.
2.	WAIVER OF PREMIUM OR MONTHLY COST OF INSURANCE
	Reinsurance premiums in the first years are zero.  Renewal reinsurance premiums to BMA are 90% of the gross disability premium charged the insured by the CEDING COMPANY on the initial amount reinsured for waiver of premium and the amount reinsured for monthly cost of insurance.

SCHEDULE C

ADDITIONAL INFORMATION

1.	This agreement includes coverage for conditional receipt liability for facultative cases sent to BMA.  In no event shall BMA's conditional receipt liability exceed $750,000.00 or the automatic binding limit specified in Schedule A, whichever is less.
	BMA's conditional receipt liability shall begin simultaneously with the CEDING COMPANY's liability and shall cease upon:
	A.	BMA's declination of the risk, or
	B.	The first acceptance by the CEDING COMPANY of an unconditional offer by a reinsurer other than BMA, or
	C.	The expiration of 120 days from the date BMA's facultative offer is communicated to the CEDING COMPANY.
2.	For policies which are underwritten as substandard, the rate charged for reinsurance will be at the standard rate plus the appropriate table rate, regardless of how the policy is treated by the CEDING COMPANY.
3.	Conversions will be reinsured on a point-in-scale basis using the same reinsurance rate as the original plan.

EXCEPTIONS

EXHIBIT I

RETENTION SCHEDULE

CEDING COMPANY:  UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

CEDING COMPANY'S MAXIMUM LIMITS OF RETENTION – MALE AND FEMALE

EFFECTIVE WITH POLICIES DATED:

LIFE

Please be sure to show your limit of retention for all ages and all rate classifications.  Show "none" in all categories where you have no retention.

		SUBSTANDARD	SUBSTANDARD	SUBSTANDARD
		TABLE FLAT EXTRA	TABLE FLAT EXTRA	TABLE FLAT EXTRA
ISSUE AGES	STANDARD
0-65	$100,000	$100,000	$100,000	$100,000
65 & OVER	$60,000	$60,000	$60,000	$60,000

*Minimum cession size $25,000

Spillover $25,000

DISABILITY

Is your Disability (Waiver of Premium, Waiver of Monthly Deduction) retention the same as Life?  Yes

If not, explain.

Do you have a separate retention for Payor Benefit issued in connection with children's policies, based on commuted amount of premium?  No  If so, what is the commuted amount retention? _____

ACCIDENTAL DEATH (ADB)

$ Bulk

Does your ADB retention apply to any ADB rate classification assigned? N/A

Is ADB retention in addition to Life amount above? N/A

EX-10.3

Exhibit 10.3

REINSURANCE AGREEMENT

referred to as the "Agreement"

BETWEEN

UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

OF

SPRINGFIELD, ILLINOIS

#5882-1

referred to in this Agreement as the "Company"

AND

LIFE REASSURANCE CORPORATION OF AMERICA

OF

STAMFORD, CONNECTICUT

referred to in this Agreement as "Life Re"

Effective:  December 1, 1993

TABLE OF CONTENTS

ARTICLE I	AUTOMATIC REINSURANCE…………………………………………	1
1.	Insurance……………………………………………………………………	1
2.	Coverages…………………………………………………………………...	2
3.	Jumbo Risk………………………………………………………………….	2
4.	Waiver of Disability Acceptance and Participation Limits………………....	3
ARTICLE II	FACULTATIVE REINSURANCE………………………………….……	3
ARTICLE III	LIABILITY…………………………………………………………….…..	3
1.	Automatic Reinsurance Liability……………………………………………	3
2.	Facultative Reinsurance Liability…………………………………………..	4
ARTICLE IV	AMOUNT OF INSURANCE………………………………………….….	4
1.	Amounts…………………………………………………………………….	4
2.	Minimum Amounts…………………………………………………………	5
3.	Reductions and Terminations……………………………………………….	5
4.	Reinstatements………………………………………………………………	6
ARTICLE V	PROCEDURES FOR REINSURANCE…………………………………..	6
1.	Monthly Reports……………………………………………………………..	6
2.	Facultative Reinsurance……………………………………………………..	7
3.	Quarterly Reports……………………………………………………………	8
ARTICLE VI	PREMIUMS………………………………………………………………..	8
1.	Life Insurance……………………………………………………………….	8
2.	Disability Benefits…………………………………………………………..	8
3.	Preliminary Term Insurance…………………………………………………	9
4.	Premium Taxes………………………………………………………………	9
5.	Payments…………………………………………………………………….	9
6.	Nonpayment of Reinsurance Premiums…………………………………….	9
7.	Misstatements……………………………………………………………….	10
ARTICLE VII	CLAIMS…………………………………………………………….……….	10
1.	Notice…………………………………………………………………………	10
2.	Company's Decision…………………………………………………….……	10
3.	Contested Claims……………………………………………………………..	11
4.	Misstatements………………………………………………………...………	11
5.	Payment………………………………………………………………………	12
6.	Extra-Contractual Damages………………………………………………….	12
7.	Disability Waiver of Premium Insurance……………………………………	12

ARTICLE VIII	INSOLVENCY……………………………………………………………..	13
ARTICLE IX	ARBITRATION…………………………………………………………….	14
ARTICLE X	GENERAL PROVISIONS…………………………………………………	15
1.	Policy Forms and Rates………………………………………………….…..	15
2.	Reinsurance Conditions……………………………………………………..	15
3.	Expenses…………………………………………………………………….	16
4.	Errors and Omissions………………………………………………………..	16
5.	Offset………………………………………………………………………...	16
6.	Inspection……………………………………………………………………	16
ARTICLE XI	RECAPTURE………………………………………………………………	17
ARTICLE XII	DURATION OF AGREEMENT……………………………………..…..	17
ARTICLE XIII	EXECUTION………………………………………………………………	18
Schedule A	Retention and Reinsurance Limits
Schedule B	Reinsurance Statement and Bulk Reporting Forms
Schedule C	Premiums

The Company and Life Re mutually agree to reinsure on the terms and conditions set forth below.  This Agreement is solely between the Company and Life Re, and performance of the obligations of each party under this Agreement will be rendered solely to the other party.  In no instance will anyone other than the Company or Life Re have any rights under this Agreement.

The policies and riders set forth in Schedule A that are reinsured under this Agreement are hereinafter referred to collectively as "Reinsured Policies" and individually as a "Reinsured Policy".

ARTICLE I

AUTOMATIC REINSURANCE

1. Insurance

The Company will cede and Life Re will accept reinsurance under the policies and riders written by the Company on citizens of the United States or Canada domiciled in the United States or Canada at the time of policy issue under the plans shown in Part III of Schedule A.  When the Company retains its maximum limit of retention, as shown in Part I of Schedule A, the Company will cede and Life Re will accept automatically reinsurance in amounts not exceeding the amounts per life in Part II of Schedule A of this Agreement.  Where the Company has more than one Agreement with Life Re, the total amount per life automatically ceded to Life Re, under all Agreements combined, will not exceed the automatic binding limits available to the Company under the Agreement with the highest binding authority.  Life Re will accept automatic reinsurance when (a) the Company already has for its own account its maximum limit of retention on the life and for this reason alone is not retaining any portion of the insurance applied for on a current application, and (b) in the Company's opinion there has been no adverse change in the insurance status of the risk since the Company's last acceptance for its own retention.  A risk as defined in the following categories is not eligible for reinsurance under this paragraph:

(a)	A jumbo risk as defined in paragraph 3 below.
(b)	A risk which has been sent to Life Re or any other reinsurer for facultative underwriting consideration.

2. Coverages

The coverages or risks reinsured under Article I, 1. is life insurance and waiver of disability benefits to the extent of limits specified in Schedule A.

3. Jumbo Risk

A jumbo risk is one where the papers of the Company, including all papers that are part of the current application, indicate that the person to be insured has or will have total insurance in force in all companies greater than:

	Life
All Ages	$5,000,000

4. Waiver of Disability Acceptance and Participation Limits  

Life Re's maximum acceptance limit for waiver of disability benefits is $2,000,000 per life, and the maximum participation limit for such benefits is $3,000,000 per life.

5. Regular Limits of Retention

The Company may modify its regular limits or retention, detailed in Schedule A, by giving thirty days' written notice to Life Re.  The amount of reinsurance to be ceded and accepted automatically after the new limits take effect will be determined by mutual Agreement.

ARTICLE II

FACULTATIVE REINSURANCE

Whether reinsurance is available as Automatic Reinsurance under Article I or not, the Company may submit, for consideration by Life Re, a request for any amount of reinsurance of the coverages in Article I, 2. that the Company may require.

ARTICLE III

LIABILITY

1. Automatic Reinsurance Liability

The liability of Life Re on any policy reinsured on an automatic basis under this Agreement begins and ends at the same time as that of the Company.

2. Facultative Reinsurance Liability

The liability of Life Re on any policy reinsured on a facultative basis under this Agreement begins and ends at the same time as that of the Company, provided that:

(a)	Life Re has given the Company an unconditional approval on the application for reinsurance, and
(b)	the Company has notified Life Re of its acceptance of such offer in writing within ninety (90) days.

ARTICLE IV

AMOUNT OF INSURANCE

1. Amounts

Life insurance and waiver of disability benefits under this Agreement will be on the Yearly Renewable Term plan for the amount at risk under the policy reinsured.  For the purpose of this Agreement, the amount as risk will be calculated in the following manner:

	R = D – X
Where:	D = Death Benefit
	X = The Ceding Company's Retention

2. Minimum Amounts

If the amount to be reinsured with Life Re and the Company's other excess reinsurers under a policy is less than $25,000, the Company will retain all of the liability for such policy.  If the amount to be reinsured with Life Re land the Company's other excess reinsurers meets or exceeds $25,000 on any policy, such amount will be reinsured pursuant to this Agreement and the Company's agreements with its other excess reinsurers.

3. Reductions and Terminations

Reinsurance amounts are calculated in terms of coverages on a "per policy" basis.  If any of the Company's policies or riders on an insured are reduced or terminated, the reinsurance under this Agreement will be reduced by the corresponding amount.  The reduction will not be applied to force the Company to reassume more than its regular retention limit at the time of the reduction for the age of issue, mortality rating and form of  the policy or policies for which reinsurance is being terminated.  The reduction first will be applied to reinsurance, if any, on the particular policy reduced.  If the reduction exceeds the amount of reinsurance on that policy, the reduction will then be applied to reinsurance on other policies on the insured in the order in which the policies were effected, the first  effected will be the first terminated or reduced.  If reinsurance has been ceded to more than one reinsurer, the reduction in Life Re's reinsurance will be in proportion to the reduction in the total.  After the proportion has been determined, the rules above will be used.

4. Reinstatements

(a)

Automatic Reinsurance A Reinsured Policy originally ceded under this Agreement on an automatic basis, that is reduced, terminated or lapsed, and later reinstated by the Company pursuant to policy provisions will be accepted for reinsurance by Life Re up to such amount as would be in force if such Reinsured Policy had not been reduced, terminated or lapsed.  The Company will pay to Life Re, Life Re's Share of any premiums and interest that the Company has received for reinstatement.

(b)

Facultative Reinsurance A Reinsured Policy originally ceded under this Agreement on a facultative basis, that was reduced, terminated, or lapsed, will require approval by Life Re prior to reinstatement of such a policy, if the Company has retained less than 50% of the risk.  Upon such approval, reinsurance for the policy will be for the amount that would be in force had the policy not been reduced, terminated, or lapsed.

ARTICLE V

PROCEDURES FOR REINSURANCE

1. Monthly Reports

Within ten (10) calendar days following the end of each calendar month, the Company will forward to Life Re a report as shown in Part I of Schedule B.  Along with the report, the Company will remit a check to Life Re for the balance indicated plus interest for the number of days since the middle of the preceding month, as if all transactions had occurred in the middle of the month.  If a balance is due the Company, it will be remitted promptly by Life Re, plus interest for the number of days since the middle of the preceding month, as if all transactions had occurred in the middle of the month.  Interest will accrue on such payments at an annual rate equal to 7%.

2. Facultative Reinsurance

When a Company requests facultative reinsurance, the application will be made by submitting Life Re Form 2068, Bulk Preliminary Notification, shown in Part II of Schedule B (or a mutually agreeable form).  The Company will send to Life Re any and all information it has about the risk, including specifically, but not limited to, copies of the application, medical examiners' reports, attending physicians' statements, inspection reports, and other reports and other papers bearing on the insurability of the risk.  Upon receipt of the application, Life Re will analyze the risk promptly and as soon as possible notify the Company of its decision and its classification of the risk.  If the Company elects to use Life Re for facultative reinsurance and after the Company's policy has been paid for and delivered, the Company will activate the facultative cession on the Company's reinsurance system, within 120 days of Life Re's decision to accept the case.  When the preceding facultative procedures have been satisfied Article V, paragraphs 2 and 4, apply to Facultative as well as Automatic Reinsurance.  A facultative indicator must be present on the monthly reinsurance transaction and inforce reports.

3. Quarterly Reports

Within thirty (30) calendar days following the end of each calendar quarter, the Company will forward to Life Re a detailed reserve and inforce run.

ARTICLE VI

PREMIUMS

1. Life Insurance

Premiums per $1,000 for life insurance rated standard and substandard are given in Schedule C.  The premiums per $1,000 are applied to the amount of life reinsurance as outlined in Article IV.  A policy fee, when applicable, is charged in each year in addition to the premium based on the amount of life insurance.  Life Re anticipates that these premiums will be continued indefinitely for all business ceded under this Agreement.  For  the purpose of satisfying requirements for deficiency reserves imposed by various state insurance departments, Life Re will guaranty for renewal the greater of the premiums provided in this Agreement or premiums based on the 1980 CSO Table at 2.5% interest.  When the Company charges a flat extra premium, whether alone or in addition to a premium based on a multiple table, the Company will pay this premium on the reinsurance amount in addition to the standard or multiple table premium for the rating and plan of reinsurance.

2. Disability Benefits

Premiums for waiver of disability benefits will be paid at the same rate as the Company charges for the benefit on which reinsurance in Life Re is based.

3. Preliminary Term Insurance

If the Company issued a policy with preliminary term insurance, the reinsurance premium for the preliminary term period will be paid to Life Re at the same rate the Company charges for the policies on which reinsurance in Life Re is based less commissions at the percentage paid by the Company.

This rule applies to all benefits under the preliminary term insurance.  For the first policy year after the preliminary term period, the premiums for all benefits will be computed at first year.

4. Premium Taxes

The Company and Life Re agree that Life Re will not reimburse the Company for state premiums taxes on reinsurance premiums received from the Company.

5. Payments

Premiums are payable annually in advance.  If reinsurance is reduced, terminated, increased or reinstated during the year, pro-rata adjustment will be made by Life Re and the Company on all premium items except policy fees.

6. Nonpayment of Reinsurance Premiums

Except as provided in Article X, 5., the payment of reinsurance premiums is a condition precedent to the liability of Life Re under Reinsured Policies.  In the event of nonpayment of reinsurance premiums as provided in this Article, Life Re will have the right to terminate the reinsurance under all Reinsured Policies having reinsurance premiums in arrears.

7. Misstatements

If the insured's age or sex was misstated and the amount of insurance on the Company's policies is adjusted, the Company and Life Re will share the adjustment in proportion to the amount of liability of each at the time of issue of the policies.  Premiums will be recalculated for the correct age or sex and amounts according to the proportion as above and adjusted without interest.  If the insured is still alive, the method above will be used for past years and the amount of reinsurance and premium adjusted for the future to the amount that would have been correct at issue.

ARTICLE VII

CLAIMS

1. Notice

The Ceding Company shall give Life Re prompt notice of any claim.  Copies of the proofs obtained by the Ceding Company together with a statement showing the amount due or paid on such claim by the Ceding Company shall be furnished to Life Re at the time payment is requested.

2. Company's Decision

Life Re shall accept the decision of the Ceding Company in settling the claim and shall pay its portion to the Ceding Company upon receipt of proof that the Ceding Company has paid the claimant.  It is agreed, however, that if a lesser amount at risk is retained by the Ceding Company than the amount ceded to Life Re, the Ceding Company shall consult with Life Re concerning its investigation and/or payment of the claim, although the final decision shall be that of the Ceding Company.

3. Contested Claims

The Ceding Company shall notify Life Re of its intention to contest, compromise, or litigate a claim involving reinsurance, and Life Re shall pay its share or the payment and specific claim expenses therein involved, unless it declines to be a party to the contest, compromise, or litigation in which case it shall pay the full amount of the reinsurance to the Ceding Company.  "Claim expenses" shall be deemed to mean only the reasonable legal and investigative expenses connected with the litigation or settlement of claims.  "Claim expenses" shall not include expenses incurred in connection with a dispute or contest arising out of conflicting claims of entitlement to policy proceeds which the Ceding Company admits are payable or any routine claim administrative expenses, Home Office or otherwise.

4. Misstatements

In the event the amount of insurance provided by a policy or policies reinsured hereunder is increased or reduced because of a misstatement of age or sex established after the death of the insured, Life Re shall share in the increase or reduction in the proportion that the net liability of Life Re bore to the sum of the retained net liability of the Ceding Company and the net liability of other reinsurers immediately prior to such increase or reduction.  The reinsurance with Life Re shall be written from commencement on the basis of the adjusted amounts using premiums and reserves at the correct ages and sex.  The adjustment for the difference in premiums shall be made without interest.

5. Payment

It is understood and agreed that the payment of a death claim by Life Re shall be made in one sum regardless of the mode of settlement under the policy of the Ceding Company.

6. Extra-Contractual Damages

In no event shall Life Re have any liability for any Extra-Contractual damages which are assessed against the Ceding Company as a result of acts, omissions or course of conduct committed by the Ceding Company or its agents, other than a good faith decision to deny claim liability, in connection with insurance reinsured under this Agreement.  It is recognized that there may be special circumstances involved which indicate that Life Re should participate in certain assessed damages.  These circumstances are not amenable to advance specific definition, but could include those situations in which Life Re was an active party in the act, omission or course of conduct which ultimately results in the assessment of such damages.  The extent of such participation will be determined on a good faith assessment of culpability in each case, but all factors being equal, the division of any such assessment will generally be in the proportion of net liability borne by each party.

7. Disability Waiver or Premium Insurance

If a claim is approved for disability waiver of premium insurance reinsured under this Agreement, the Ceding Company shall continue to pay reinsurance premiums to Life Re.  Life Re shall reimburse the Ceding Company Life Re's share of the annual liability.

ARTICLE VIII

INSOLVENCY

All reinsurance under this Agreement will be paid by Life Re directly to the Company, its liquidator, receiver, or statutory successor, on the basis of the liability of the Company under the policy or policies reinsured without diminution because of the insolvency of the Company.  In the event of the insolvency of the Company, the liquidator, receiver, or statutory successor of the Company will give written notice of a pending claim against the Company on any policy reinsured within a reasonable time after the claim is filed in the insolvency proceedings.  While the claim is pending, Life Re may investigate and interpose, at its own expense, in the proceedings where the claim is to be adjudicated , any defenses which it may deem available to the Company or its liquidator, receiver or statutory successor.  The expense incurred by Life Re will be charged, subject to court approval, against the Company as an expense of liquidation to the extent of a proportionate share of the benefit that accrues to the Company as a result of the defenses by Life Re.  Where two or more reinsurers are involved and a majority in interest elect to defend a claim, the expense will be apportioned in accordance with the terms of the Reinsurance Agreement as if the expense had been incurred by the Company.

ARTICLE IX

ARBITRATION

Life Re and the Company intend that any dispute between them under or with respect to this Agreement be resolved without resort to any litigation.  Accordingly, Life Re and the Company agree that they will negotiate diligently and in good faith to agree on a mutually satisfactory resolution of any such dispute; provided, however, that if any such dispute cannot be so resolved by them within sixty calendar days (or such longer period as the parties may agree) after commencing such negotiations, Life Re and the Company agree that they will submit such dispute to arbitration in the manner specified in, and such arbitration proceeding will be conducted in accordance with, the rules of the American Arbitration Association.

The arbitration hearing will be before a panel of three arbitrators, each of whom must be a present or former officer of a life insurance or life reinsurance company.  Life Re and the Company will each appoint one arbitrator by written notification to the other party within thirty calendar days after the date of the mailing of the notification initiating the arbitration.  These two arbitrators will then select the third arbitrator within sixty calendar days after the date of the mailing of the notification initiating arbitration.

If either Life Re or the Company fail to appoint an arbitrator, or should the two arbitrators be unable to agree upon the choice of a third arbitrator, the president of the American Arbitration Association or of its successor organization or (if necessary) the president of any similar organization designated by lot of Life Re and the Company within thirty calendar days after the request will appoint the necessary arbitrators.

The vote or approval of a majority of the arbitrators will decide any question considered by the arbitrators; provided, however, that if no two arbitrators reach the same decision, then the average of the two closest mathematical determinations will constitute the decision of all three arbitrators.  The place of arbitration will be Stamford, Connecticut.  Each decision (including without limitation each award) of the arbitrators will be final and binding on all parties and will be nonappealable, and (at the request of either of Life Re or the Company) any award of the arbitrators may be confirmed by a judgment entered by any court of competent jurisdiction.  No such award or judgment will bear interest.  Each party will be responsible for paying (a) all fees and expenses charged by its respective counsel, accountants, actuaries, and other representatives in conjunction with such arbitration and (b) one-half of the fees and expenses charged by each arbitrator.

ARTICLE X

GENERAL PROVISIONS

1. Policy Forms and Rates

The Company will furnish Life Re with a copy of its application forms, policy and rider forms, premium and non-forfeiture value manuals, reserve tables and any other forms or tables needed for proper handling of reinsurance under this Agreement.  It will advise Life Re promptly of any changes or new forms it may adopt from time to time.

2. Reinsurance Conditions

The reinsurance is subject to the same limitations and conditions as the insurance under the policy or policies written by the Company on which the reinsurance is based.

3. Expenses

The Company will bear the expense of all medical examinations, inspection fees, and other charges in connection with the original policy.

4. Errors and Omissions

If either the Company or Life Re fails to perform an obligation under this Agreement, and such failure is the result of an Error on the part of the Company or Life Re, such Error will be corrected by restoring both the Company and Life Re to the positions they would have occupied had no such Error occurred.  For this purpose, "Error" shall mean any clerical mistake made inadvertently, excluding errors of judgement and all other forms of error.  For business reported but not covered under the provisions of this Agreement, Life Re shall be obligated only for the return of premium paid.

5. Offset

Any amount which either the Company or Life Re is contractually obligated to pay to the other party may be paid out of any amount which is due and unpaid under this Agreement or under any other agreement heretofore and hereafter entered into between the Company and Life Re.  The application of this offset provision shall not be deemed to constitute diminution in the event of insolvency.

6. Inspection

At any reasonable time, Life Re may inspect the original papers and any and all books or documents at the Home Office of the Company relating to or affecting reinsurance under this Agreement.

ARTICLE XI

RECAPTURE

After the Reinsured Policies have been in force for ten (10) years, the Company may recapture all, but not less than all, of the Reinsured Policies under this Agreement.  If the Company elects to recapture, it will notify Life Re in writing at least ninety (90) days before it begins recapturing all Reinsured Policies.  At the next anniversary (or tenth anniversary, if later) of each Reinsured Policy, the reinsurance under this Agreement will be terminated as to that Reinsured Policy.

ARTICLE XII

DURATION OF AGREEMENT

This Agreement will be effective on and after the effective date stated in Article XIII.  It is unlimited in duration but may be amended by mutual consent of the Company and Life Re.  It may be terminated as to new reinsurance by either party giving ninety (90) days' written notice to the other.  Termination as to new reinsurance does not affect existing reinsurance.  That reinsurance will remain in force until termination of the Company's policy or policies on which the reinsurance is based in accordance with the terms of this Agreement.

ARTICLE XIII

EXECUTION

In witness of the above, this Agreement is signed in duplicate at  the dates and places indicated with an effective date of December 1, 1993.

UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

Date:	11/15/93	By:	/s/ James E. Melville
		Name:	James E. Melville
		Title:	President

LIFE REASSURANCE CORPORATION OF AMERICA

Date:	October 1, 1993	By:	/s/ Stephen D. Poth
		Name:	Stephen D. Poth
		Title:	Senior Vice President

SCHEDULE A

Agreement Number 5882-1

Part I – RETENTION LIMITS OF UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

A.	LIFE
	The Company's retention:
	Life Insurance – All Ratings

Ages   0 – 65 65 and Over Retention   $100,000    60,000

B.	WAIVER
	Same as Life

Part II – AUTOMATIC BINDING LIMITS (through age 70)

A.	LIFE
	Life Re's share is 50% of 10 times the Company's retention to a maximum of $1,000,000; of which the maximum share to Life Re is $500,000.
B.	WAIVER
	Same as Life

Part III – PLANS COVERED

The preceding schedules refer to insured lives and riders under the following plans:

	BASE POLICY FORMS
1200A	Funder 1200 10 Year Premium Whole Life Policy
1203	Non Renewable 10 Year Term Base Plan
L-185 (U.G.)	Interest Sensitive Whole Life Insurance Policy
L-396 (U.G.)	5 Year R&C Term Policy
L193A	Small Whole Life Policy
REG-TERM (U.G.)	"Term Guard Plus" Term Life Insurance
U159385A	Universal Life Century 2000
UC-120	Universal Life Century Series (USL 100-400)
UC-150	Interest Sensitive Life contracts (ISL 100-300)
UL90A (U.G.)	Universal Life UL90A
	RIDERS & SUPPLEMENTAL BENEFITS
R-902 (U.G.)	Annual Renewable Level Term (UL90A)
R-904 (U.G.)	Cov Ins Annual Renewable Level Term Rdr (UL90A)
R1201	Non Renewable 10 Year Term Rider for Funder 1200
R904UG93	Covered Insured ART Rider (UL Age Last)
US-125	Annual Renewable Level Term Rider (USL)
US-131	Annual Renewable Level Term Rider (ISL)

SCHEDULE B - PART I

Life Re Agreement Number 5882-1

LIFE REASSUSRANCE CORPORATION OF AMERICA

SELF ADMINISTERED/BILK REINSURANCE SUMMARY REPORTING FORM

Ceding Company	Reinsurer
Treaty/Account #	Period Experience is for
Coin ___  YRT ___  Mod Co ___  Other _____	Interest Sensistive:	Yes ____	No ____

Reinsurance premium Mode:	Monthly __		Quarterly __	Annual __		In Advance __	In Arrears __
Reinsurance Reporting Mode:	Monthly __		Quarterly __	Annual __
Contact		Date			Phone

SECTION I - ACCOUNTING
		*** Premiums ***				*** Allowances ***		Other Benefit		Total
		First Year		Renewal Year		First Year	Renewal Year
Life
ADB
Waiver of Premium
Other
TOTAL
SECTION II – RESERVE INFORMATION									Amount of check
Amount of Rein (000)			Issue Year		Reserves Reinsured
Life	ADB				Life	ADB	Waiver	Subst'd		Deficiency

SECTION III – POLICY EXHIBIT INFORMATION
	Current Perod		Year to Date
	No of       Amt of * Policies   Rein (000)		No. of            Amt of * Policies         Rein (000)
A. Inforce Beg, of Period		A
1. New Business                           Auto		1. Auto
Fac		Fac
2. Conversions/Replacements-On		2.
3. Reinstatements		3.
4. Other Increases		4.
5. Not Taken		5.
a) Total Inc (1+2+3+4-5)		a.
6. Death		6.
7. Conversions/Replacements-Off		7.
8.  Lapses		8.
9. Surrenders		9.
10. Expiry		10.
11. Recapture		11.
12.Other Decreases		12.
b) Total Dec (6+7+8+9+10+11+12)		b.
B. Inforce End of Period (A+a-b)		B.
*Specified Reinsurers's Share of Liability			Form #TA1(4/91)

SCHEDULE B – PART I

Agreement Number 5882-1

SELF-ADMINISTERED REINSURANCE

POLICY TRANSACTION DETAIL REPORT

A.	The policy detail report should be broken down into the following categories:
	1 – New Business
	2 – First Year Other Than New Business*
	3 - Renewals
	4 – Terminations – (First year/Renewal split optional, subtotals by termination type       optional).
	5 – Changes - (First year/Renewal split optional, subtotals by change type optional).

*If premium mode other than annual.

Subtotals should be provided by plan code for each of the above categories.  Where smokers and non-smokers are not assigned separate plan codes, subtotals for the above should be further broken down to provide totals by smoking habit.

Automatic and facultative business should be shown separately for each of the five categories above.

If more than one currency is involved per treaty, provide separate reports by currency.

If there is any qualified pension business ceded, please provide separate reporting.

B. Field Descriptions

1.	Insured Information
	Name	Full name (Last, first, middle) for insured
	DOB	Full date of birth (MM/DD/YY) for insured
	Sex	M/F
	S/N	Smoker habit.  Up to three spaces should be allotted for this field to accommodate codes relevant to the treaty reported.  Suggested codes are:
	S	Smoker
	N	Nonsmoker
	A	Aggregate (or composite)
	PN	Preferred nonsmoker
	PS	Preferred smoker
	Age	Actual age at issue
	ST	State of residence
2	Policy Information
	Policy No.	Ceding Company's policy number.
		Policies should be listed in numerical order.
	Plan	Ceding Company's plan code.
	DOI	Full policy date (MM/DD/YY).  This is the date from which renewal processing will be driven.
	DRN	Duration from original policy date (i.e., where attained scale rates apply to policy conversions or replacements).
	A/F	Automatic/Facultative indicator.  Business ceded on a fac/ob basis can be indicated by an "0" in this field.
	Rating	Indicate table if substandard.  100% for standard issues.
	Flat	Flat extra amount per thousand.
	Yrs	Duration of flat extra (number of years).
	OPT	For Universal Life plans only, indicate death benefit Option 1 or 2.  Under Option 1, the level death benefit option, the amount at risk decreases as the cash value accumulates.  Option 2 produces an increasing death benefit, equivalent to the specified amount plus the accumulated cash value.  The Reinsured Net Amount at Risk remains level under this option.
	COV	L – Basic Coverage
		WP – Waiver of Premium
		ADB – Accidental Death Benefit
	DIRECT FACE	Full face amount of the coverage at issue.
	REINS. FACE	Initial amount ceded.
	REINS. AAR	Current reinsured amount at risk.
	Chg. Amt.	Any change to the reinsurance amount at risk since previous report should be illustrated here.
	Chg. Dt.	Effective date of policy changes.  Applies to termination and change reports, may be blank for new business and renewals.
	TR	Transaction type (see list in Part C below).
	Base Prem.	Gross premium due for each coverage (excluding substandard premium amounts).
	SStd. Prem.	Gross substandard premium, i.e., multiple and/or flat extra premiums, if applicable.
	Base Allow.	Allowance (commission) due on base premium amount.
	SStd. Allow.	Allowance (commission) due on substandard premium amount.
	Net	Net amount due per coverage.

C.	Transaction Types
	Suggested alpha codes for each of the various transaction types are:
	1.	NB	New Business
	2.	FO	First year other than New Business
	3.	RL	Renewal
	4.	Terminations
		LP	Lapse
		NT	Not Taken
		SR	Surrender
		EX	Expiry
		DH	Death
		RC	Recapture
	5.	Changes
		RS	Reinstatement
		IC	Increase
		DC	Decrease
		CA	Conversions on
		CO	Conversions off
		RA	Internal Replacements on
		RO	Internal Replacements off
		ET	ETI
		RP	Reduced paid Up
		MS	Misc. (e.g. names changes, benefit additions)

EX-10.4

Exhibit 10.4

ASSUMPTION REINSURANCE AGREEMENT

between

UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

and

FIRST INTERNATIONAL LIFE INSURANCE COMPANY

TABLE OF CONTENTS

		Page
ARTICLE I	DEFINITIONS…………………………………...……….	1
ARTICLE II	BUSINESS ASSUMED…………………………..………	3
ARTICLE III	ASSUMPTION CERTIFICATES……………………..….	5
ARTICLE IV	GENERAL PROVISIONS………………………..………	7
ARTICLE V	CONSIDERATION FOR ASSUMPTION    REINSURANCE………………………………..………	10
ARTICLE VI	DUTY OF COOPERATION………………………...……	10
ARTICLE VII	ARBITRATION…………………………………..………	11
ARTICLE VIII	INDEMNIFICATION……………………………..……...	11
ARTICLE IX	EXECUTORY CONTRACT AND INSOLVENCY    SETOFF………………………………………………….	12
ARTICLE X	MISCELLANEOUS PROVISIONS……………..……….	13

EXHIBITS

A	Policyholder Notice
B	Certificate of Assumption
C	Notice of Objection to Assumption

ASSUMPTION REINSURANCE AGREEMENT

This Assumption Reinsurance Agreement (the "Assumption Agreement"), is made and entered into as of September 30, 1996, by and between UNIVERSAL GUARANTY LIFE INSURANCE COMPANY, a life insurance company (the "Company), and FIRST INTERNATIONAL LIFE INSUARNCE COMPANY, a life insurance company (the "Reinsurer").

WHEREAS, the Company and the Reinsurer have entered into a Coinsurance Agreement, as of the date hereof (the "Coinsurance Agreement"), pursuant to which the Company has agreed to cede to the Reinsurer, and the Reinsurer has agreed to accept the indemnity reinsure, on a 100% coinsurance basis, all of the Reserves and Liabilities (as hereinafter defined), but not reserves for incurred but not reported claims and immediate payment of claims, arising under or with respect to the Reinsured Policies (as hereinafter defined); and

WHEREAS, the Coinsurance Agreement provides that, upon the occurrence of certain events as specified in Article XVI therein, the Reinsurer shall have the right, in its sole discretion, to elect to assumption reinsure the Reinsured Policies, with a concurrent novation and complete release of the Company from any liability under such Reinsured Policies, on a state by state basis after the Effective Date upon the receipt of any and all applicable regulatory approvals and notice to relevant Policyholders followed by expiration of the applicable period with no opt out by such Policyholders or the obtaining of required consents from such Policyholders, as the case may be, under the terms and conditions set forth herein;

NOW THEREFORE, in consideration of the foregoing and the mutual agreements set forth herein, the company and the Reinsurer mutually agree as follows:

ATRICLE I

DEFINITIONS

As used in this Assumption Agreement, the following capitalized terms shall have the following meanings (definitions are applicable to both the singular and the plural  forms of each term defined in this Article I):

"Assumption Date" shall have the meaning set forth in Section 2.4.

"Business Day" means any day other than a Saturday or Sunday or a day on which banking institutions in the States of New York, Ohio and Delaware are permitted or obligated by law to be closed.

"Certificate of Assumption" shall have the meaning set forth in Section 3.1.

"Coinsurance Agreement" shall have the meaning set forth in the first recital hereof.

"Effective Date" shall have the same meaning as in the Coinsurance Agreement.

"Extra Contractual Liabilities" shall have the same meaning as in the Coinsurance Agreement.

"Insolvency Proceedings" shall have the meaning set forth in Section 9.5.

"Notice of Objection" shall have the meaning set forth in Section 3.1.

"Novated Policies" means the Reinsured Policies with respect to which no rejection of assumption has been filed by a Policyholder pursuant to the terms of Section 3.2 of this Assumption Agreement (or with respect to which other applicable regulatory requirements have been met), and with respect to which the terms of Section 3.4 apply.

"Person" means any corporation, individual, joint stock company, joint venture, partnership, unincorporated association, governmental regulatory entity, country, state or political subdivision thereof, trust or other entity.

"Policyholder" means a holder of a Reinsured Policy.

"Policyholder Notice" shall have the meaning set forth in Section 3.1.

"Policy Loans" shall have the same meaning as set forth in the Coinsurance Agreement.

"Reinsured Policies" means all paid-up insurance policies, issued by the Company, that are in force on the Effective Date, except policies offered in settlement to so called "HIV" policyholders and paid-up business associated with the Company's Jr./Sr. Plan Single Premium Interest Sensitive Whole Life Policies, including, without limitation, policy loans.

"Reserves and Liabilities" means the statutory reserves held by the Company as of the Effective Date in support of the policy liabilities arising under the Reinsured Policies and payable after the Effective Date (determined by reference to lines 1, 5, 7 and 8 on page 3 of its 1995 Annual Statement Blank) less Policy Loans.

"Reinsurance Agreement" shall have the same meaning as in the Coinsurance Agreement.

ATRICLE II

BUSINESS ASSUMED

2.1	Coverage.  After the Effective Date and upon the terms and subject to the conditions, including Section XVI of the Coinsurance Agreement, and other provisions of this Assumption Agreement and any required governmental and regulatory consents and approvals, the Company, if requested to do so by the Reinsurer, hereby agrees to cede to the Reinsurer and the Reinsurer hereby agrees to accept and reinsure, on an assumption basis, any Reinsured Policy.  Reinsurance pursuant to this Section 2.1 shall occur no less frequently than on a monthly basis until all Reinsured Policies have been assumed pursuant to the provisions of Article III hereunder; provided, however, that reinsurance may occur more frequently if the parties hereto agree.
2.2	Exclusions.  This Assumption Agreement does not apply to and specifically excludes from coverage any Extra Contractual Liabilities.  In addition, the Reinsurer shall not assume, and shall be indemnified by the Comapny for, all guaranty fund assessments and premium taxes or similar charges imposed on or with respect to the Reinsured Policies to the extent that such assessments, taxes or charges are based on premiums remitted prior to the Effective Date.
2.3	Transfer of Reserves.  Notwithstanding the provisions of Section 2.1 hereof, the Reinsurer will not be deemed to have accepted and reinsured, on an assumption basis, any Reinsured Policy unless the Reserves and Liabilities underlying such Reinsured Policy shall have been ceded by the Company to the Reinsurer, and accepted by the Reinsurer, pursuant to Article II of the Coinsurance Agreement, effective as of the Effective Date.
2.4	Assignment of Ceded Reinsurance.
	(a)	Regardless of whether reinsurance novation agreements are entered into between the Reinsurer and any reinsurer, the Reinsurer shall be substituted for and succeed to all of the rights and liabilities of the Company, and shall, as between the parties hereto, be recognized for all purposes as the "Company" thereunder in substitution for the Company, under any Reinsurance Agreements in effect as of the date that the provisions of Section 2.1 hereunder take effect (the "Assumption Date") with any reinsurer relating to the Reinsured Policies.  For consideration which has already been provided for in Article IV of the Coinsurance Agreement, as of the Assumption Date, the Company shall assign, transfer and convey, and the Reinsurer shall be bound by and assume, any and all rights and obligation of the Company under any Reinsurance Agreement including amounts held by or which may become due from reinsurers for policy liabilities under the Reinsured Policies or for benefits or other amounts paid by the Company prior to the Assumption Date.  The Company and the Reinsurer shall use their best efforts to effect, as promptly as possible, an endorsement to each Reinsurance Agreement substituting the Reinsurer for the Company and to amend the Ceded Reinsurance Agreement to comply with the credit for reinsurance provisions of (i) the Delaware Insurance Law and (ii) any other statute or regulation applicable to the cession of reinsurance by foreign life insurance companies.  The Company agrees to enter into such endorsements and, if reasonably requested by the Reinsurer, aid the Reinsurer, at the Reinsurer's expense, in obtaining any such endorsement.
	(b)	From the Assumption Date, the Company hereby agrees that all amounts due the Reinsurer hereunder pursuant to the Reinsurance Agreements shall be paid directly to the Reinsurer by reinsurers and reinsurance brokers.  The Company shall, if reasonably requested by the Reinsurer, aid the Reinsurer, at the Reinsurer's expense, in collection of all amounts due from reinsurers.  From the Assumption Date, the collectability of such reinsurance shall be the ultimate responsibility of the Reinsurer and shall be at the risk and for the account of the Reinsurer in the event such reinsurance is not collected.
	(c)	From the Assumption Date, the Reinsurer shall have full power and authority as attorney-in-fact for the Company to act for and on behalf of the Company with respect to any and all letters of credit and trust funds outstanding for the benefit of the Company pursuant to the terms of any of the Reinsurance Agreements.  The Company and the Reinsurer shall, at the expense of the Reinsurer, each use their best efforts to the extent mutually agreed to be necessary, to cause the reinsurers of the Company under the Reinsurance Agreements to post replacement letters of credit or establish replacement trust funds to be issued or established directly in favor and for the benefit of the Reinsurer in the same or a grater amount and on terms equally as favorable to the Reinsurer, unless the Reinsurer shall otherwise consent.  The Company agrees to transfer to the Reinsurer all funds withheld from reinsurers under the Reinsurance Agreements.

ARTICLE III

ASSUMPTION CERTIFICATES

3.1	Policyholder Notices.  Upon the request of the Reinsurer to reinsure, on an assumption basis, a Reinsured Policy pursuant to Section 2.1 hereof, and to the extent that the reinsurance of such Reinsured Policy is permitted or approval therefore has been granted under applicable laws, rules or regulations or positions of insurance regulatory authorities, the Reinsurer shall prepare, with the cooperation of the Company, a Policyholder notice ("Policyholder Notice"), certificate of assumption ("Certificate of Assumption") and objection form ("Objection Form"), and mail them to the Policyholder of such Reinsured Policy.  Subject to regulatory requirements of the various states, the Policyholder Notices, Certificates of Assumption and Objection Forms to be delivered to Policyholders pursuant to this Section 3.1 shall be substantially in the forms attached hereto as Exhibit A, B and C, respectively.
3.2	Right to Object.  Subject to regulatory requirements of the various states, the Company and the Reinsurer agree that a Policyholder will be allowed to remain a Policyholder of the Company if such Policyholder refuses to effect the assumption of its Reinsured Policy in accordance with this Article III during the applicable period set forth in the Policyholder notice, and all of the rights and obligations of the Company and the Policyholder under such Reinsured Policy and of the Company and the Reinsurer under the Coinsurance Agreement with respect to such Reinsured Policy, shall remain the same.
3.3	Novated Policies.  In the event that a Reinsured Policy defined herein as a Novated Policy is determined by applicable regulatory authorities or by judicial decision (in either case, following the exhaustion of all rights of appeal) not to have been novated, such Reinsured Policy shall, for all purposes of this Assumption Agreement, be deemed never to have been a Novated Policy.  Notwithstanding the foregoing, the fact that a Reinsured Policy has not been or cannot be assumed and novated by the Reinsurer pursuant to the terms and conditions of this Assumption Agreement, for whatever reason, shall in no event cause it not to be a Reinsured Policy under the Coinsurance Agreement.
3.4	Direct Obligations.  The Reinsurer shall be the successor to the Company under the Novated Policies as if the Novated Policies were direct obligations originally issued by the Reinsurer.  The Reinsurer shall be substituted in the place and stead of the Company, and each Policyholder, insured or beneficiary under a Novated Policy shall disregard the Company as a party thereto and treat the Reinsurer as if it had been originally obligated thereunder.  Such Persons shall have the right to file claims or take other actions under the Novated Policies on or after the effective date of such novation directly with the Reinsurer, and shall have a direct right of action for insurance liabilities reinsured thereunder against the Reinsurer, and the Reinsurer hereby consents to be subject to direct action taken by any such Persons under a Novated Policy.  The Reinsurer accepts and assumes the Novated Policies subject to any and all defenses, setoffs and counterclaims to which the Company would be entitled with respect to such insurance liabilities, it being expressly understood and agreed by the parties hereto that no such defenses, setoffs or counterclaims are waived by the execution of this Assumption Agreement or the consummation of the transactions contemplated hereby and that the Reinsurer shall be fully subrogated to all such defenses, setoffs and counterclaims.
3.5	Release of Company; Indemnity.  Upon the consummation of the assumption reinsurance of a Reinsured Policy from the Company to the Reinsurer under this Reinsurance Agreement, the Company shall be released from any and all liability, except for Extra Contractual Liabilities, with respect to such Reinsured Policy.  From and after the consummation of the assumption reinsurance of a Reinsured Policy pursuant to this Assumption Agreement, the Reinsurer agrees to indemnify the Company for any and all damages, costs and expenses, including reasonable legal counsel fees and disbursements, arising out of, based upon or relating to such Novated Policy; provided, however, that the Reinsurer shall be under no obligation to indemnify the Company for any Extra Contractual Liabilities.

ARTICLE IV

GENERAL PROVISIONS

4.1	Policy Administration.  To the extent that such transfers have not already taken place pursuant to the terms and conditions of the Coinsurance Agreement, the Company agrees to cooperate fully with the Reinsurer in the transfer of all books, records, papers or any other documents relating to such Novated Polices.
4.2	Billing and Collections.  Effective on the respective dates on which the novation of any Reinsured Policy is effective, the Reinsurer shall have sole responsibility for billing and collecting policy loan repayments, interest and the making of payments of dividends in respect of the Novated Policies, subject to the terms of any administrative or other agreements between the parties hereto that have been or heretofore may be entered into and the terms of agreements between the Reinsurer and its agents or subcontractors.
4.3	Misunderstandings and Oversights.  If any delay, omission, error or failure to pay amounts due or to perform any other act required by this Assumption Agreement is unintentional and caused by misunderstanding or oversight, the Company and the Reinsurer will adjust the situation to what it would have been had the misunderstanding or oversight not occurred.  The party first discovering such misunderstanding or oversight, or act resulting from the misunderstanding or oversight, will notify the other party in writing promptly upon discovery thereof, and the parties shall act to correct such misunderstanding or oversight within thirty (30) Business Days of receipt of such notice.  However, this Section shall not be construed as a waiver by either party of its right to enforce strictly the terms of this Assumption Agreement.
4.4	Litigation; Claims.  The Reinsurer shall be responsible for the handling of, and all costs and expenses, including legal fees, relating to, litigation or other claims under the Novated Policies.  Notwithstanding the foregoing, the Reinsurer shall have no liability for such costs and expenses to the extent they arise out of or are based on any Extra Contractual Liabilities, and to the extent that the Reinsurer incurs any such costs or expenses, the Reinsurer shall be indemnified by the Company.
4.5	Non-Compete.  The Company shall take no action directly or indirectly to induce any Policyholder of a Novated Policy to terminate, reinstate, lapse or exchange such policy.
4.6	Compliance with Applicable Laws and Regulations.
	(a)	Intent of Parties.  It is the intention of the parties that this Assumption Agreement shall be interpreted in accordance with the laws as of the date of execution hereof by both parties and comply with all existing applicable state and federal laws and regulations, and as from time to time are or may be in effect, in such a way that the Reinsured Policies remain reinsured on the coinsurance plan and contingent assumption plan.
	(b)	Procedures to Reflect Changes in Laws or Regulations.  In the event that it is determined by an insurance regulatory authority or the Internal Revenue Service or by either party upon the advise of an insurance regulatory authority or the Internal Revenue Service that this Assumption Agreement fails to conform to the requirements of existing applicable laws and regulations and that the Assumption Agreement may be brought into conformity with said requirements only by means of a material change to the Assumption Agreement, or in the event that such laws or regulations are changed subsequent to the Effective Date and such change has a material adverse affect on either party or requires a material change to the Assumption Agreement in order for the Assumption Agreement to conform with applicable laws and regulations, the parties shall exercise reasonable efforts to reach an agreement to amend the Assumption Agreement so as to return the parties to the economic position that they would have been in had no such change occurred or so that both parties share the economic position that they would have been in had no such change occurred or so that both parties share the economic detriment of such change equally.  If the parties are unable to reach an agreement to amend the Assumption Agreement, then the differences between the parties shall be resolved through arbitration in accordance with the provisions of Article VII.  In the event that any changes required to conform the Assumption Agreement to the requirements of applicable law or regulation is not material, the Assumption Agreement shall be amended accordingly.  In no event, however, shall this provision prevent either party from exercising any right it otherwise has under this Assumption Agreement.  For purposes of this Section 4.6 (b), the word "material" shall mean, when used with respect to (i) any change in law or regulation, or any change into the Assumption Agreement necessary to bring the Assumption Agreement into conformity with the requirements of any law or regulation; or (ii) any delay, omission, error or failure to pay amounts due or to perform any other act required under this Assumption Agreement; or (iii) any default, that the effect or effects of any of (i), (ii) or (iii) above (either individually or cumulatively) results in a deviation from a projected return under this Assumption Agreement (absent the occurrence of (i), (ii) or (III) above, either individually or cumulatively) by at least five percent (5%), measured from the first day that the occurrence of (i), (ii) or (iii) above, or series thereof, taken into account on a cumulative basis, occurred or becomes effective.
	(c)	Notification of Disapproval or Change in Law.  The Company shall promptly notify the Reinsurer of any disapprovals, recommended changes or statements regarding the Assumption Agreement that are made by any insurance or tax regulatory authorities and of any change in law, regulation or rulings affecting this Assumption Agreement.  The Reinsurer shall be allowed to make its own defense of the Assumption Agreement with said authorities.
4.7	Recoupment and Failure of Consideration.  If either party to this Assumption Agreement fails to perform this Assumption Agreement in full, then the other party has the right to suspend performance, and if the defaults cannot be cured, within one hundred and twenty (120) days following delivery of written notice from the non-defaulting party to the defaulting party, to terminate this Assumption Agreement.  Alternatively, the non-defaulting party can recoup damages (including, without limitation, the amount owned plus interest from the date owed and calculated at the Chase Bank prime rate plus two points) from future settlements between the parties.

ARTICLE V

CONSIDERATION FOR ASSUMPTION REINSURANCE

5.1 Consideration.  The consideration provided for in Article IV of the Coinsurance Agreement shall be the consideration for the assumption of the Novated Polices (as direct obligations) by the Reinsurer, and there shall be no additional consideration or premium due or payable under this Assumption Agreement.

ARTICLE VI

DUTY OF COOPERATION

6.1 Duty of Cooperation.  Each party hereto shall cooperate fully with the other in all reasonable respects in order to accomplish the objectives of this Assumption Agreement.  This duty to cooperate shall include obtaining the governmental and regulatory consents and approvals and taking the other steps necessary for the assumption of the Reinsured Policies, as described in Article III hereof.  In addition, this duty to cooperate shall include making available any Reinsured Policy records which either party subsequently may require to resolve issues related to claims or liabilities.  The Company and the Reinsurer agree to perform such additional acts and execute such additional documents and agreements as may be necessary or desirable to carry out the purposes and objectives of this Assumption Agreement; provide however, that Reinsurer shall reimburse the Company for reasonable out-of-pocket expenses incurred by the Company.

ARTICLE VII

ARBITRATION

7.1	General.  Any dispute or difference between the parties with respect to the operation or interpretation of, or arising from or relating to, this Assumption Agreement on which and amicable understanding cannot be reached shall be decided pursuant to and in accordance with the terms, conditions and procedures set forth in Article X1 of the Coinsurance Agreement.
7.2	Survival.  This Article shall survive termination of this Assumption Agreement.

ARTICLE VIII

INDEMNIFICATION

8.1	The Company.  The Company hereby agrees on demand to indemnify and hold harmless the Reinsurer, and its respective officers, directors and employees from and against any and all demands, actions, proceedings, suits (by any person) and liabilities, paid or incurred (including reasonable attorneys' fees), resulting from or arising out of the breach of or failure to perform any of the duties, obligations, covenants or agreements of the Company contained in this Assumption Agreement.
8.2	The Reinsurer.  The Reinsurer hereby agrees to indemnify and hold harmless the Company, and its respective officers, directors and employees from and against any and all demands, actions, proceedings, suits (by and Person) and liabilities, paid or incurred (including reasonable attorneys' fees), resulting from or arising out of the breach of or failure to perform any of the duties, obligations, covenants or agreements of the Reinsurer contained in this Assumption Agreement.
8.3	Survival of Article.  This Article shall survive termination of this Assumption Agreement.

ARTICLE IX

EXECUTORY CONTRACT AND INSOLVENCY-SETOFF

9.1	Insolvency-Setoff (or Offset).  In the event either party to the Assumption Agreement shall be the subject of insolvency proceedings ("Insolvency Proceedings") all independent debts on unrelated contracts between the parties shall be setoff to the extent:
	(a)	the debt from the creditor to the insolvent arose pre-petition.
	(b)	the debt from the insolvent to the creditor arose pre-petition.
	(c)	the debts are mutual, meaning they are between the two parties to this Assumption Agreement, and in the same right and the same capacity.
	The cash payment due on each reinsurance agreement between the parties shall constitute the "debt" on such agreement.
9.2	Adequate Assurance.  In the event of Insolvency Proceedings involving the Company, the Reinsurer's future performance is conditioned on receiving adequate assurance of future performance, as defined in the Uniform Commercial Code, §2-206, and the Official Comments thereunder.
9.3	Ipso Facto Clause.  If the receiver, including any liquidator or rehabilitator, of one of the parties assigns the rights or delegates the duties of this Assumption Agreement, and the assignee is the subject of Insolvency Proceedings then the other party may immediately terminate the Assumption Agreement without further performance.
9.4	Executory Contract.  In the event either party to the Assumption Agreement is the subject of Insolvency Proceedings the receiver of the insolvent, with respect to future account settlements, may affirm or reject the Assumption Agreement, but not affirm the rewards and reject the burdens.  If this Assumption Agreement is neither affirmed nor rejected within one hundred and twenty (120) days after a party becomes the subject of Insolvency Proceedings, then the Assumption Agreement shall be deemed to be rejected.
	If either party is the subject of Insolvency Proceedings other than liquidation proceedings, then the other party may request adequate assurance of continued performance and the first priority administrative expense with respect to future performance prior to the time the Assumption Agreement is either affirmed or rejected, and if such is not provided, then, after one hundred and twenty (120) days, the other party may treat its future performance as canceled.
9.5	Insolvency Proceedings.  For purposes of this Assumption Agreement the term "Insolvency Proceedings" shall include, but not be limited to, any action by a state insurance regulatory authority to place a party in, or the actual commencement of, delinquency proceedings, including conservatorship, receivership, rehabilitation, reorganization, "adjustment of debts," "voluntary supervision," or liquidation.

ARTICLE X

MISCELLANEOUS PROVISIONS

10.1	No Third Party Beneficiaries.  This Assumption Agreement is between the Company and the Reinsurer, and the performance of the obligations of each party under this Assumption Agreement shall be rendered solely to the other party.  In no instance shall anyone other than the Company or the Reinsurer, or their successors or permitted assigns, have any rights, benefits or remedies under this Assumption Agreement.  Until the Reinsurer has reinsured a Reinsured Policy on an assumption reinsurance basis pursuant to this Assumption Reinsurance Agreement, the Reinsurer shall not be liable to any insured, contract owner, or beneficiary under any Reinsured Policy.
10.2	Heading and Exhibit.  Headings used herein are inserted solely for the convenience of reference and are not a part of this Assumption Agreement and shall not affect the terms hereof.  The attached Exhibits are part of this Assumption Agreement.
10.3	Notices.  All notices and communications hereunder shall be in writing and shall be deemed to have been received three (3) Business Days after mailing, or if by telefax or by hand, when received, and it by overnight mail, on the next Business Day.  Any written notice shall be by either certified or registered mail, return receipt requested, or overnight delivery service (providing for delivery receipt) or delivered by hand.  All notices or communications with the Reinsurer under this Assumption Agreement shall be addressed as follows:
		First International Life Insurance Company c/o The Guardian Life Insurance Company of America 201 Park Avenue South New York, New York  10003 Attention:  Jeremy Starr Telefax No.:  (212) 598-8659
	All notices and communications with the Company under this Assumption Agreement shall be directed to:
		Universal Guaranty Life Insurance Company 5250 South Sixth Street Springfield, Illinois  62750-5147 Attention:  James Melville Telefax No.:  (217) 786-4372
10.4	Severability.  If any term or provision of this Assumption Agreement shall be held void, illegal, or unenforceable, the validity of the remaining portions or provisions of this Assumption Agreement shall not be affected thereby; provided, however, that to the extent that such remaining portions or provisions affect the economic positions of the parties hereunder, this Assumption Agreement shall be amended by the parties so as to return the parties to the economic positions that they would have been in had no such severance occurred or so that both parties share the economic detriment of such severance equally.
10.5	Assignment.  This Assumption Agreement may not be assigned by either party without the prior written consent of the other and any attempted assignment without such consent shall be void.
10.6	Successors and Assigns.  The provisions of this Assumption Agreement shall be binding upon and  inure to the benefit of and be enforceable by the parties hereto and their respective successors and permitted assigns.
10.7	Execution in Counterparts.  This Assumption Agreement may be executed by the parties hereto in any number of counterparts, and by each of the parties hereto in  separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.
10.8	Amendments.  This Assumption Agreement may be amended only by written amendment hereto executed by the parties.
10.9	Waiver.  The failure of the Company or Reinsurer to insist on strict compliance with this Assumption Agreement, or to exercise any right or remedy under this Assumption Agreement, shall not constitute a waiver of any rights provided under this Reinsurance Agreement, nor stop the parties from thereafter demanding full and complete compliance nor prevent the parties from exercising such a right or remedy in the future.
10.10	Interpretation.  No provision of this Assumption Agreement shall be construed against any party on the ground that such party drafted the provision or caused it to be drafted.
10.11	Entire Agreement.  This Assumption Agreement and the Coinsurance Agreement constitute the sole and entire agreement and understanding between the parties hereto, and supersedes all prior agreements, whether oral or written, between the parties, with respect to the subject matter hereof.
10.12	Governing Law and Forum.  This Assumption Agreement shall be governed by the laws of the State of New York, without giving effect to principles of conflicts or law thereof. Both parties hereby irrevocable and unconditionally submit themselves to the exclusive jurisdiction of the Courts of the State of New York for any actions, suits or proceedings of or relating to this Assumption Agreement and the transactions contemplated thereby that cannot be resolved pursuant to the provisions of Article VII hereof.
10.13	Confidentiality.  Except as required by law or regulatory authority, neither the Company nor the Reinsurer shall publicly disclose the purchase price or other terms of the transfer proposed herein, but this restriction shall terminate if such price and terms shall otherwise become public knowledge.  In the event that the Reinsurer or its representative are requested or required by oral questions, interrogatories, requests for information or documents, subpoena, civil investigation, demand or similar process to disclose any terms or information regarding such transfer provided, however, that to the extent practicable under the circumstances the Reinsurer shall give the Company reasonable notice of the order or request before making the disclosure provided that such notice can be provided without cost to the Reinsurer.  This Section 10.13 shall survive termination of this Assumption Agreement and the Coinsurance Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Assumption Agreement to be executed by their duly authorized representatives.

UNIVERSAL GUARANTY LIFE INSURANCE COMPANY

By	/s/ James E. Melville
	Name:  James E Melville
	Title:  President
ATTEST
	/s/ Theodore C. Miller
	Name:  Theodore C. Miller
	Title:  Vice President

FIRST INTERNATIONAL LIFE INSURANCE COMPANY

By:	/s/ Jeremy Starr
	Name:  Jeremy Starr
	Title:  Vice President, Reinsurance
	October 18, 1996
ATTEST:
	/s/ Benjamin H Mitchell
	Name:  Benjamin H. Mitchell
	Title:  Actuary
	October 18, 1996

EX-10.19

Exhibit 10.19

PROMISSORY NOTE

Principal $8,000,000.00		Loan Date 11-20-2015	Maturity 11-20-2016	Loan No. 40000	Call / Coll C / 3	Account 72957158	Officer MRD	Initials
	References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item. Any item above containing "***" has been omitted due to text length limitations.

Borrower:	UTG, INC.		Lender:	ILLINOIS NATIONAL BANK
	5250 SOUTH SIXTH STREET			MAIN BRANCH
	SPRINGFIELD, IL 62703			322 E. CAPITOL
				SPRINGFIELD, IL 62701
Principal Amount:  $8,000,000.00		Interest Rate:  3.750%		Date of Note:  November 20, 2015

PROMISE TO PAY.UTG, INC. ("Borrower") promises to pay to ILLINOIS NATIONAL BANK ("Lender"), or order, in lawful money of the United States of America, the principal amount of Eight Million & 00/100 Dollars ($8,000,000.00) or so much as may be outstanding, together with interest on the unpaid outstanding principal balance of each advance, calculated as described in the "INTEREST CALCULATION METHOD" paragraph using an interest rate of 3.750%.  Interest shall be calculated from the date of each advance until repayment of each advance.  The interest rate may change under the terms and conditions of the "INTEREST AFTER DEFAULT" section.

PAYMENT.  Borrower will pay this loan in one payment of all outstanding principal plus all accrued unpaid interest on November 20, 2016.In addition, Borrower will pay regular monthly payments of all accrued unpaid interest due as of each payment date, beginning December 20, 2015, with all subsequent interest payments to be due on the same day of each month after that.  Unless otherwise agreed or required by applicable law, payments will be applied first to any accrued unpaid interest; then to principal; then to any unpaid collection costs; and then to any late charges.  Borrower will pay Lender at Lender's address shown above or at such other place as Lender may designate in writing.

INTEREST CALCULATION METHOD.  Interest on this Note is computed on a 365/365 simple interest basis; that is, by applying the ratio of the interest rate over the number of days in a year (366 during leap years), multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding.  All interest payable under this Note is computed using this method.

PREPAYMENT; MINIMUM INTEREST CHARGE.In any event, even upon full prepayment of this Note, Borrower understands that Lender is entitled to a minimum interest charge of $50.00.Other than Borrower's obligation to pay any minimum interest charge,Borrower may pay without penalty all or a portion of the amount owed earlier than it is due.  Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower's obligation to continue to make payments of accrued unpaid interest.  Rather, early payments will reduce the principal balance due.  Borrower agrees not to send Lender payments marked "paid in full", "without recourse", or similar language.  If Borrower sends such a payment, Lender may accept it without losing any of Lender's rights under this Note, and Borrower will remain obligated to pay any further amount owed to Lender.  All written communications concerning disputed amounts, including any check or other payment instrument that indicates that the payment constitutes "payment in full" of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount must be mailed or delivered to:  Illinois National Bank, 322 E. Capitol Springfield, IL 62701.

LATE CHARGE.  If a payment is 10 days or more late, Borrower will be charged 5.000% of the unpaid portion of the regularly scheduled payment or $25.00, whichever is greater.

INTEREST AFTER DEFAULT.Upon default, including failure to pay upon final maturity, the interest rate on this Note shall be increased by 4.000 percentage points.  However, in no event will the interest rate exceed the maximum interest rate limitations under applicable law.

DEFAULT.  Each of the following shall constitute an event of default ("Event of Default") under this Note:

Payment Default.  Borrower fails to make any payment when due under this Note.

Other Defaults.Borrower fails to comply with or to perform any other term, obligation, covenant or condition contained in this Note or in any of the related documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between Lender and Borrower.

Default in Favor of Third Parties.  Borrower or any Grantor defaults under any loan, extension of credit, security agreement, purchase or sales agreement, or any other agreement, in favor of any other creditor or person that may materially affect any of Borrower's property or Borrower's ability to repay this Note or perform Borrower's obligations under this Note or any of the related documents.

False Statements.  Any warranty, representation or statement made or furnished to Lender by Borrower or on Borrower's behalf under this Note or the related documents is false or misleading in any material respect, either now or at the time made or furnished or becomes false or misleading at any time thereafter.

Insolvency.  The dissolution or termination of Borrower's existence as a going business, the insolvency of Borrower, the appointment of a receiver for any part of Borrower's property, any assignment for the benefit of creditors, any type of creditor workout, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against Borrower.

Creditor or Forfeiture Proceedings.  Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help, repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the loan.  This includes a garnishment of any of Borrower's accounts, including deposit accounts, with Lender.  However, this Event of Default shall not apply if there is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond for the dispute.

Events Affecting Guarantor.  Any of the preceding events occurs with respect to any guarantor, endorser, surety, or accommodation party of any of the indebtedness or any guarantor, endorser, surety, or accommodation party dies or becomes incompetent, or revokes or disputes the validity of, or liability under, any guaranty of the indebtedness evidenced by this Note.

Change In Ownership.  Any change in ownership of twenty-five percent (25%) or more of the common stock of Borrower.

PROMISSORY NOTE

Loan No:  40000 (Continued) Page 2

Adverse Change.  A material adverse change occurs in Borrower's financial condition, or Lender believes the prospect of payment or performance of this Note is impaired.

Insecurity.  Lender in good faith believes itself insecure.

Cure Provisions.  If any default, other than a default in payment, is curable and if Borrower has not been given a notice of a breach of the same provision of this Note within the preceding twelve (12) months, it may be cured if Borrower, after Lender sends written notice to Borrower demanding cure of such default: (1) cures the default within ten (10) days; or (2) if the cure requires more than ten (10) days, immediately initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure the default and thereafter continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical.

LENDER'S RIGHTS.  Upon default, Lender may declare the entire unpaid principal balance under this Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount.

ATTORNEYS' FEES; EXPENSES.  Lender may hire or pay someone else to help collect this Note if Borrower does not pay.  Borrower will pay Lender that amount.  This includes, subject to any limits under applicable law, Lender's attorneys' fees and Lender's legal expenses, whether or not there is a lawsuit, including attorneys' fees, expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), and appeals.  If not prohibited by applicable law, Borrower also will pay any court costs, in addition to all other sums provided by law.

JURY WAIVER.  Lender and Borrower hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either Lender or Borrower against the other.

GOVERNING LAW.  This Note will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the State of Illinois without regard to its conflicts of law provisions.  This Note has been accepted by Lender in the State of Illinois.

CHOICE OF VENUE.  If there is a lawsuit, Borrower agrees upon Lender's request to submit to the jurisdiction of the courts of SANGAMON County, State of Illinois.

CONFESSION OF JUDGMENT.  Borrower hereby irrevocably authorizes and empowers any attorney-at-law to appear in any court of record and to confess judgment against Borrower for the unpaid amount of this Note as evidenced by an affidavit signed by an officer of Lender setting forth the amount then due, attorneys' fees plus costs of suit, and to release all errors, and waive all rights of appeal.  If a copy of this Note, verified by an affidavit, shall have been filed in the proceeding, it will not be necessary to file the original as a warrant of attorney.  Borrower waives the right to any stay of execution and the benefit of all exemption laws now or hereafter in effect.  No single exercise of the foregoing warrant and power to confess judgment will be deemed to exhaust the power, whether or not any such exercise shall be held by any court to be invalid, voidable, or void; but the power will continue undiminished and may be exercised from time to time as Lender may elect until all amounts owing on this Note have been paid in full.  Borrower hereby waives and releases any and all claims or causes of action which Borrower might have against any attorney acting under the terms of authority which Borrower has granted herein arising out of or connected with the confession of judgment hereunder.

RIGHT OF SETOFF.  To the extent permitted by applicable law, Lender reserves a right of setoff in all Borrower's accounts with Lender (whether checking, savings, or some other account).  This includes all accounts Borrower holds jointly with someone else and all accounts Borrower may open in the future.  However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law.  Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing on the indebtedness against any and all such accounts, and, at Lender's option, to administratively freeze all such accounts to allow Lender to protect Lender's charge and setoff rights provided in this paragraph.

COLLATERAL.  Borrower acknowledges this Note is secured by Commercial Pledge Agreement dated November 20, 2013.

LINE OF CREDIT.  This Note evidences a revolving line of credit.  Advances under this Note, as well as directions for payment from Borrower's accounts, may be requested orally or in writing by Borrower or by an authorized person.  Lender may, but need not, require that all oral requests be confirmed in writing. Borrower agrees to be liable for all sums either: (A) advanced in accordance with the instructions of an authorized person or (B) credited to any of Borrower's accounts with Lender.  The unpaid principal balance owing on this Note at any time may be evidenced by endorsements on this Note or by Lender's internal records, including daily computer print-outs.

SECURITY INTEREST IN DEPOSIT ACCOUNTS.  Borrower grants to Lender a contractual security interest in, and hereby assigns, conveys, delivers, pledges, and transfers to Lender all Borrower's right, title and interest in and to, Borrower's deposit accounts with Lender (whether checking, savings, or some other account), including without limitation all deposit accounts held jointly with someone else and all deposit accounts Borrower may open in the future, excluding however all IRA and Keogh accounts, and all trust accounts for which the grant of a security interest would be prohibited by law.  Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing on this Note against any and all such deposit accounts.

DISHONORED ITEM FEE.  Borrower will pay a fee to Lender of $25.00 if Borrower makes a payment on Borrower's loan and the check or preauthorized charge with which Borrower pays is later dishonored.  If your payment is returned unpaid, you authorize Illinois National Bank to make a one-time electronic fund transfer from your account to collect a fee of $25.00.

LOAN AGREEMENT.  This Note is issued in connection with a Business Loan Agreement dated November 20, 2015 between Borrower and Lender and the terms and conditions of said Business Loan Agreement are expressly incorporated herein and made a part of this Note by reference.

PRIOR NOTE.  This Promissory Note is a renewal of, extension of, refinancing of, modification of and substitution for Promissory Note from Borrower to Lender dated November 20, 2014 in the original principal amount of $8,000,000.00, which was a renewal of, extension of, refinancing of, modification of and substitution ofor the original Promissory Note dated Novemver 20, 2012 in the original principal amount of $8,000,000.00.

SUCCESSOR INTERESTS.  The terms of this Note shall be binding upon Borrower, and upon Borrower's heirs, personal representatives, successors and assigns, and shall inure to the benefit of Lender and its successors and assigns.

PROMISSORY NOTE

Loan No:  40000 (Continued) Page 3

GENERAL PROVISIONS.If any part of this Note cannot be enforced, this fact will not affect the rest of the Note.  Lender may delay or forgo enforcing any of its rights or remedies under this Note without losing them.  Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, and notice of dishonor.  Upon any change in the terms of this Note, and unless otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or endorser, shall be released from liability.  All such parties agree that Lender may renew or extend (repeatedly and for any length of time) this loan or release any party or guarantor or collateral; or impair, fail to realize upon or perfect Lender's security interest in the collateral; and take any other action deemed necessary by Lender without the consent of or notice to anyone.  All such parties also agree that Lender may modify this loan without the consent of or notice to anyone other than the party with whom the modification is made.  The obligations under this Note are Joint and several.

PRIOR TO SIGNING THIS NOTE,BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE.  BORROWER AGREES TO THE TERMS OF THE NOTE.

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.

BORROWER: UTG, INC.
By:	/s/ James P. Rousey	By:	/s/ Theodore C. Miller
	JAMES P. ROUSEY, President of UTG, INC.		THEODORE C. MILLER, CFO/Secretary of UTG, INC.

EX-21.1

Exhibit 21.1

LIST OF SUBSIDIARIES
Subsidiary Name	State of Incorporation
BCG Land, LLC		Kentucky
Collier Beach, LLC		South Carolina
Cumberland Woodlands, LLC		Kentucky
HPG Acquisitions, LLC		Texas
Imperial Plan, Inc.		Texas
LS Clarkston Investco, LLC		Delaware
Midland Superblock Partners, LLC		Texas
Northwest Florida of Okaloosa Holding, LLC		Florida
NV Holding Group, LLC		Nevada
Red River Gorge Properties, LLC		Kentucky
Sand Lake, LLC		Florida
Stanford Wilderness Road, LLC		Kentucky
UG Acquisitions, LLC		Delaware
UGL Titusville Marina, LLC		Florida
UGLIC, LLC		Texas
UTAG, Inc.		Illinois
UTG Avalon, LLC		Florida
Universal Guaranty Life Insurance Company		Ohio
VMA Mobile, LLC		Delaware
Wingate of St Johns Holding, LLC		Florida

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 annual report on Form 10-K of the registrant, UTG, Inc.;
	2.	Based on my knowledge, this annual 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 changes 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:   March 25, 2016				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 annual report on Form 10-K of the registrant, UTG, Inc.;
2.	Based on my knowledge, this annual 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 changes 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:   March 25, 2016	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 18 U.S.C. SECTION 1350

In connection with the Annual Report on Form 10-K of UTG, Inc. (the "Company") for the period ended December 31, 2015, 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:	March 25, 2016	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 18 U.S.C. SECTION 1350

In connection with the Annual Report on Form 10-K of UTG, Inc. (the "Company") for the period ended December 31, 2015 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:	March 25, 2016	By:	/s/ Theodore C. Miller
			Theodore C. Miller
			Senior Vice President, Corporate
			Secretary and Chief Financial Officer

EX-99.1

Exhibit 99.1

UTG, Inc.

Charter of the Audit Committee of the Board of Directors

I. Purpose

The Audit Committee (the "Committee") is appointed by the Board of Directors (the "Board") to assist the Board in fulfilling its responsibility to oversee the quality and integrity of the Company's financial reporting and the audits of the financial statements of the Company. The Audit Committee's primary purpose is to assist the Board in oversight of:

§ The integrity of the Company's financial statements and internal controls;

§ The Company's compliance with legal and regulatory requirements;

§ The qualifications and independence of the Company's independent registered public accounting firm; and

§ The performance of the Company's internal audit function and independent registered public accounting firm.

II. Composition

The Audit Committee shall be comprised of one or more members of the Board.  Committee members will be appointed by the Board to serve until their successors are elected. Unless a chairperson is elected by the full Board, the members of the Committee may designate a chairperson by majority vote.  All members of the Committee shall meet the independence criteria and have the qualifications set forth in Rule 10A-3 of the Securities Exchange Act of 1934 (the "Exchange Act").

Accordingly, all of the members of the Committee shall be directors:

§ Who do not accept any direct or indirect consulting, advisory or compensatory fee from the Company other than for board service or in respect of retirement or deferred compensation for prior service, who are not an "affiliated person" within the meaning of Rule 10A-3 under the Exchange Act; and

§ Who have a basic understanding of finance and accounting and are able to read and understand fundamental financial statements and the regulatory requirements of the Company's industry.

It is desirable, but not mandatory that at least one member of the Committee shall have accounting or related financial management expertise, or any other comparable experience or background which results in the individual's financial sophistication, including being or having been a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities.  The above is not intended to require a Committee member to meet the SEC definition of a "financial expert".

III. Meetings

The Committee shall meet as often as deemed necessary or appropriate in its judgment, generally at least twice annually, either in person or by phone.  Any member of the Committee may call meetings of the Committee.

At least annually, the Committee should meet privately in executive session with management, the independent auditors, and as a Committee to discuss any matters that the Committee or each of the groups believes should be discussed.  The Committee may ask members of management or others to attend meetings and provide pertinent information as necessary.

In addition, the Committee, or at least its Chair, should communicate with management and the independent auditors annually, at a minimum, to review the Company's financial statements and significant audit findings.

IV. Responsibilities and Duties

Documents/Reports/Accounting Information Review

§ Review and reassess the adequacy of this Charter at least annually and submit the charter to the Board of Directors for approval.

§ Review the Company's annual audited financial statements prior to filing or distribution.  Review should include discussion with management and independent auditors of significant issues regarding accounting principles, practices, and judgments.

§ Recommend to the board whether the financial statements should be included in the annual report on Form 10-K.

Independent Registered Public Accounting Firm and Audit Process

§ Appoint, compensate, retain, and oversee the work performed by the independent auditor retained for the purpose of preparing or issuing an audit report or related work.  Review the performance and independence of the independent auditor and remove the independent auditor if circumstances warrant. The independent auditor will report directly to the Audit Committee and the Audit Committee will oversee the resolution of disagreements between management and the independent auditor if they arise.

§ On an annual basis, the Committee should review and discuss with the independent auditors all significant relationships they have with the Company that could impair the auditors' independence.

§ Review and approve both audit and nonaudit services to be provided by the independent auditor.  The authority to grant approvals may be delegated to one or more designated members of the Audit Committee, whose decisions will be presented to the full Audit Committee at its next meeting.

§ Discuss with the independent auditor the matters required to be discussed under the standards of the PCAOB.

§ Review with the independent auditor any problems or difficulties and management's response.

§ Hold timely discussions with the independent auditor regarding the following:

o Critical accounting policies and practices

o Other material written communications between the independent auditor and management, including, but not limited to, the management letter and schedule of unadjusted differences.

§ At least annually, obtain and review a report by the independent auditor describing:

o The independent auditor's internal quality-control procedures

o Any material issues raised by the most recent internal quality-control review or peer review, or by any inquiry or investigation by governmental or professional authorities within the preceding five years with respect to independent audits carried out by the independent auditor, and any steps taken to deal with such issues

o All relationships between the independent auditor and the Company, addressing the matters set forth in PCAOB Rule 3526.

Financial Reporting Processes, Accounting Policies, and Internal Control Structure

§ Periodically review the adequacy and effectiveness of the Company's disclosure controls and procedures and the Company's internal control over financial reporting, including any significant deficiencies and significant changes in internal controls.

§ Understand the scope of the internal auditor's review of internal control over financial reporting and obtain report on significant findings and recommendations, together with management responses.

§ Receive and review any disclosure from the Company's CEO and CFO made in connection with the certification of the Company's quarterly and annual reports filed with the SEC of: a) significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize, and report financial data; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control.

§ Review major issues regarding accounting principles and financial statement presentations, including any significant changes in the Company's selection or application of accounting principles; major issues as to the adequacy of the Company's internal controls; and any special audit steps adopted in light of material control deficiencies.

§ Annually review a summary of director and officers' related party transactions and potential conflicts of interest.

§ Oversee the receipt, retention, and treatment of complaints regarding accounting, internal accounting controls, or auditing matters, including the confidential, anonymous submission by Company employees regarding questionable accounting or auditing matters.

Ethical Compliance, Legal Compliance, and Risk Management

§ Review, with the Company's counsel or other appropriate individuals, legal compliance and legal matters that could have a significant impact on the Company's financial statements.

§ Discuss policies with respect to risk assessment and risk management, including appropriate guidelines and policies to govern the process, as well as the Company's major financial risk exposures and the steps management has undertaken to control them.

Reporting and Other Responsibilities

§ Review, with management, the Company's finance function, including its annual Plan, organization, and quality of personnel.

§ Perform other activities consistent with this Charter, the Company's bylaws, and governing laws that the Board or Audit Committee determines are necessary or appropriate.

V. Procedures

The Committee is empowered to investigate any matter brought to its attention with full access to all books, records, facilities and personnel of the Company.  The Committee shall have the authority and sufficient funding to retain outside legal counsel, accountants or other experts as it determines necessary and appropriate to assist the Committee in carrying out its functions, without obtaining the approval of the Board or management.

VI. Limitation of Audit Committee's Role

While the Committee has the oversight responsibility set forth in this Charter, it does not have the duty to plan or conduct audits or to determine that the Company's financial statements and disclosures are complete and accurate and are in accordance with generally accepted accounting principles and applicable rules and regulations. These are the responsibility of management and the independent registered public accounting firm. In addition, the Committee recognizes that the Company's management, internal audit staff and the independent registered public accounting firm, devote more time to reviewing or analyzing the Company's business and its operations and as a result, have more knowledge and detailed information concerning the Company than members of the Committee. Consequently, in carrying out its oversight responsibilities, the Committee is not providing any expert or special assurance as to the Company's financial statements or any professional certification as to the quality or adequacy of the independent registered public accounting firm.

EX-99.3

Exhibit 99.3

UTG, Inc.

Charter of the Compensation Committee of the Board of Directors

I.Compensation Committee Purpose

The Compensation Committee of the Board of Directors (the "Board") of UTG, Inc. (the "Company") is appointed by the Board to discharge the Board's responsibilities relating to compensation of the Company's Chief Executive Officer (the "CEO"), the Company's executive officers and other senior executives of the Company (the "Senior Executives").  The Committee has overall responsibility for approving and evaluating all compensation plans, policies and programs of the Company as they affect the CEO and the Senior Executives.

II.Compensation Committee Composition

The Committee shall have a least two members.  The members of the Committee shall be determined at the first meeting of the Board to be held following the annual general meeting of shareholders or as soon thereafter as practicable.  Vacancies on the Committee shall be filled by like vote of the Board at the next meeting of the Board following the occurrence of the vacancy or as soon thereafter as practicable.  A member may be removed from the Committee at any time, with or without cause, by the Board.

Each member of the Committee must satisfy such criteria of independence as the Board may establish and such additional regulatory or listing requirements as the Board may determine to be applicable or appropriate.  Accordingly, each member must qualify as a "non-employee director" under Rule 16b-3 of the Securities and Exchange Commission (the "SEC") and may not be part of a compensation committer interlock within the meaning of SEC Regulation S-K.  Members of the Committee should be suitably knowledgeable in matters pertaining to executive compensation.

The Committee may form, and delegate its authority to subcommittees as it deems appropriate.  The Committee also may delegate compensation functions to the Company's human resources personnel and to external advisors, as it deems appropriate.  The Board may appoint the Committee's Chairperson, but if the Board has not appointed a Chairperson, the Committee shall elect a Chairperson from among its members.

III.Compensation Committee Meetings

The Compensation Committee shall meet as often as may be deemed necessary or appropriate in its judgment, but not less frequently than 1 time annually, either in person or telephonically, and at such times and places as the Committee shall determine.  The Committee may request any officer or employee of the Company or the Company's outside counsel to attend a meeting of the Compensation Committee or to meet with any members of, or consultants to, the Committee.  The Compensation Committee shall report its activities to the Board regularly.

IV.Compensation Committee Responsibilities and Duties

The Committee shall have the following responsibilities:

· Annually review and approve corporate goals and objectives relevant to CEO compensation, evaluate the CEO's performance in light of those goals and objectives, and recommend to the Board the CEO's overall compensation levels based on this evaluation.  In Evaluating the incentive components of CEO compensation, the Compensation Committee shall consider the Company's performance and relative shareholder return, the value of similar incentive awards to CEOs at comparable companies, and the awards given to the CEO in past years.  Notwithstanding the foregoing, if any grant or award to the CEO is intended to qualify for the performance-based compensation exemption from the limitations on deductibility of executive compensation imposed by Section 162(m) of the Internal Revenue Code of any successor thereto, the Compensation Committee, or any independent subcommittee thereof, rather than the Board, shall approve such award, but it may refer such award to the Board for ratification.

· At least annually, review and approve the annual base salaries and annual incentive opportunities of the CEO and the Senior Executives.  In addition, periodically and as and when appropriate, review and approve the following as they affect the CEO and the Senior Executives: (a) all other incentive awards and opportunities, including both cash-based and equity-based awards and opportunities; (b) any employment agreements and severance arrangements; and (c) any change-in-control agreements and change-in-control provisions affecting any elements of compensation and benefits.  Finally, the Compensation Committee shall review and approve any special or supplemental compensation and benefits for the CEO and the Senior Executives and persons who formerly served as the CEO and/or as Senior Executives, including supplemental retirement benefits and the perquisites provided to them during and after employment.

· Monitor the Company's compliance with the requirements under the Sarbanes-Oxley Act of 2002 relating to 401(k) plans and loans to directors and officers and with all other applicable laws affecting employee compensation and benefits.

· Monitor and evaluate matters relating to the compensation and benefits structure of the Company as the Compensation Committee deems appropriate, including: (a) provide guidance to senior management on significant issues affecting compensation philosophy or policy, and (b) evaluate whether the risks arising from the Company's compensation policies and practices for its employees would be reasonably likely to have a material adverse effect on the Company.

· May form and delegate authority to subcommittees when appropriate.

· Review and reassess the adequacy of this Charter periodically and recommend any proposed changes to the Board for approval.

· Consult with the Chief Executive Officer and advise the Board with respect to senior management succession planning.

V.Outside Advisors

The Compensation Committee shall have the authority to retain such outside consultants or advisors as it determines appropriate to assist it in the performance of its functions, or to advise or inform the Committee, including sole authority to retain and terminate any compensation consultant used to assist the Committee in the evaluation of director, CEO or senior executive compensation, and to approve the consultant's fees and other retention terms.

EX-99.4

UTG, Inc.

Charter of the Investment Committee of the Board of Directors

I.Investment Committee Purpose

The purpose of the Investment Committee (the "Committee") of the Board of Directors (the "Board") of UTG, Inc. (the "Company") shall be to oversee the Company's investment transactions, management, policies and guidelines, including review of investment manager selection, establishment of investment benchmarks, review of investment performance and oversight of investment risk management exposure policies and guidelines.

II.Investment Committee Composition

The Committee shall be comprised of three or more directors.  The members of the Committee shall be determined at the first meeting of the Board to be held following the annual general meeting of shareholders or as soon thereafter as practicable.  Vacancies on the Committee shall be filled by like vote of the Board at the next meeting of the Board following the occurrence of the vacancy or as soon thereafter as practicable.  A member may be removed from the Committee at any time, with or without cause, by the Board.

The Committee may form, and delegate its authority to subcommittees as it deems appropriate.  The Committee also may delegate investment functions to the Company's investment personnel and to external managers, as it deems appropriate.  The Board may appoint the Committee's Chairperson, but if the Board has not appointed a Chairperson, the Committee shall elect a Chairperson from among its members.

III.Investment Committee Meetings

The Committee shall establish a regular meeting schedule, which shall be a least two times annually or more frequently as circumstances require.  The Chairperson of the Committee or a majority of the members of the Committee may also call a special meeting of the Committee.

A majority of the members of the Committee present in person or by means of a conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other shall constitute a quorum.  All actions of the Committee will require the vote of a majority of its members present at the meeting of the Committee at which a quorum is present.  The Committee shall maintain minutes of its meetings and shall regularly report on its actions to the Board.

The Committee may form subcommittees for any purpose that the Committee deems appropriate and may delegate to such subcommittees such power and authority as the Committee deems appropriate; provided, however, that no subcommittee shall consist of fewer than two members; and provided further that the Committee shall not delegate to the subcommittee any power or authority required by any law, regulation or listing standard to be exercised by the Committee as a whole.

The Committee shall have access to any of the books and records of the Company that the Committee shall consider relevant to carrying out its duties and may require any officer or employee of the Company to attend meetings of the Committee and provide to it any information available to the Company relevant to the Committee's activities, except as the Board may otherwise direct.

IV.Investment Committee Responsibilities and Duties

The Committee shall have the following responsibilities:

· Establish and periodically review the Company's investment policies and guidelines.

· Oversee and periodically review the performance of the Company's investments, including the impact on such performance of the Company's investment policies and guidelines.

· Periodically review the structure, approach and effectiveness of the Company's investment function, including the performance of, and allocation of responsibilities between, Company personnel and third-party advisers.

· Select the Company's money managers and investment advisers, monitor their performance and, when appropriate, terminate their engagement.

· Authorize investments, either on an ad hoc basis or as standing authorities, and ratifying investments made pursuant to delegated authorities.

· Monitor on an ongoing basis the performance of the Company's investment advisers and retain and terminate such advisers as it deems appropriate.

V.Outside Advisors

The Committee may conduct or authorize investigations into or studies of matters within the Committee's scope of responsibilities, and may retain, at the Company's expense, such independent counsel or other advisers as it deems necessary for the proper performance of its responsibilities.  The Company's Chief Investment Officer, with the approval of the Chief Executive Officer, and the Committee shall each have the authority to retain or terminate any consultant or advisor retained at the direction of the Committee or the Company's Chief Investment Officer to assist the Committee in carrying out its responsibilities, including authority to approve the fees or other compensation, and other retention terms, of such consultant or advisor, such fees or other compensation to be borne by the Company.

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Document and Entity Information - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2015	Dec. 31, 2015	Jul. 31, 2014	Jun. 30, 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		2015
Document Fiscal Period Focus		FY
Document Type		10-K
Amendment Flag		false
Document Period End Date		Dec. 31, 2015

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Balance Sheet - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Investments available for sale:
Fixed maturities, at fair value	$ 185,119,097	$ 197,481,456
Equity securities, at fair value	45,685,340	40,996,002
Trading securities, at fair value	0	3,826,250
Mortgage loans on real estate at amortized cost	17,769,930	23,161,982
Discounted mortgage loans on real estate at cost	0	0
Investment real estate	47,650,102	51,007,101
Financing Receivable, Gross	10,597,907	5,612,560
Policy loans	10,684,244	11,104,485
Short-term investments	0	4,382,181
Total investments	317,506,620	337,572,017
Cash and cash equivalents	11,822,615	13,977,443
Accrued investment income	2,821,338	2,662,865
Reinsurance receivables:
Future policy benefits	27,462,830	27,906,905
Policy claims and other benefits	3,553,978	3,788,294
Cost of insurance acquired	8,140,379	9,047,984
Deferred policy acquisition costs	0	0
Property and equipment, net of accumulated depreciation	2,016,611	2,475,829
Income tax receivable	619,043	0
Other assets	3,283,681	2,468,901
Total assets	377,227,095	399,900,238
Policy liabilities and accruals:
Future policyholder benefits	269,119,859	275,044,909
Policy claims and benefits payable	3,759,565	3,208,324
Other policyholder funds	457,774	341,248
Dividend and endowment accumulations	14,233,644	14,239,054
Income tax payable	0	1,933,243
Deferred income taxes	3,405,467	9,413,794
Notes payable	0	4,400,000
Trading securities liabilities, at fair value	28,609	23,853
Other liabilities	9,234,675	7,723,213
Total liabilities	300,239,593	316,327,638
Shareholders' equity:
Common stock	3,699	3,706
Additional paid-in capital	43,002,670	43,122,944
Retained earnings	33,062,282	32,145,662
Accumulated other comprehensive income	(1,183,552)	6,853,974
Total UTG shareholders' equity	74,885,099	82,126,286
Noncontrolling interests	2,102,403	1,446,314
Total shareholders' equity	76,987,502	83,572,600
Total liabilities and shareholders' equity	$ 377,227,095	$ 399,900,238

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Balance Sheet Parenthetical - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Investments available for sale:
Fixed maturities, amortized cost	$ 188,647,671	$ 188,634,364
Equity securities, cost	43,954,737	39,275,638
Trading securities, cost	0	5,179,850
Liabilities:
Trading Securities, Proceeds	$ 108,881	$ 464,215
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)	3,699,447	3,706,780

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Income Statement - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Revenues:
Premiums and policy fees	$ 11,164,857	$ 11,667,248
Reinsurance premiums and policy fees	(3,090,503)	(3,126,914)
Net investment income	15,559,935	16,349,719
Other income	707,069	1,676,602
Revenues before realized gains (losses)	24,341,358	26,566,655
Realized investment gains (losses), net:
Other-than-temporary impairments	(3,570,601)	(162,905)
Other realized investment gains, net	7,997,194	17,221,078
Total realized investment gains, net	4,426,593	17,058,173
Total revenues	28,767,951	43,624,828
Benefits, claims and settlement expenses:
Life	20,245,920	21,404,297
Reinsurance benefits and claims	(2,919,064)	(2,855,202)
Annuity	996,485	597,792
Dividends to policyholders	446,567	479,158
Commissions and amortization of deferred policy acquisition costs	(168,533)	432,695
Amortization of cost of insurance acquired	907,605	985,650
Operating expenses	8,916,771	10,776,690
Interest expense	68,876	677,079
Total benefits and other expenses	28,494,627	32,498,159
Income before income taxes	273,324	11,126,669
Income tax expense	932,715	(1,082,927)
Net income	1,206,039	10,043,742
Net income attributable to noncontrolling interest	(289,419)	(3,067,726)
Net income attributable to common shareholders'	$ 916,620	$ 6,976,016
Amounts attributable to common shareholders':
Basic income per share (in dollars per share)	$ 0.25	$ 1.86
Diluted income per share (in dollars per share)	$ 0.25	$ 1.86
Basic weighted average shares outstanding (in shares)	3,704,322	3,750,239
Diluted weighted average shares outstanding (in shares)	3,704,322	3,750,239

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Consolidated Statement of Comprehensive Income - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Condensed Consolidated Statement of Comprehensive Income [Abstract]
Net Income	$ 1,206,039	$ 10,043,742
Other comprehensive income, net of tax
Unrealized holding gains/(losses) arising during period	(11,117,183)	6,501,163
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Tax	3,891,014	(2,275,407)
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Net of Tax	(7,226,169)	4,225,756
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, before Tax	(1,248,241)	(1,278,743)
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax	436,884	447,560
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax	(811,357)	(831,183)
Subtotal: Other comprehensive income (loss), net of tax	(8,037,526)	3,394,573
Comprehensive income	(6,831,487)	13,438,315
Less comprehensive income attributable to noncontrolling interests	(289,419)	(3,067,726)
Comprehensive income attributable to UTG, Inc.	$ (7,120,906)	$ 10,370,589

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Statement of Shareholders' Equity - USD ($)	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Noncontrolling Interest [Member]
Balance, beginning of year at Dec. 31, 2013	$ 77,867,441	$ 3,776	$ 44,050,778	$ 25,169,646	$ 3,459,401	$ 5,183,840
Issued during year	68,947	4	68,943	0	0	0
Treasury shares acquired and retired	(996,851)	(74)	(996,777)	0	0	0
Net income attributable to common shareholders	6,976,016	0	0	6,976,016	0	0
Other comprehensive income (loss)
Unrealized holding income (loss) on securities net of noncontrolling and reclassification adjustment and taxes	3,394,573	0	0	0	3,394,573	0
Contributions	185,689	0	0	0	0	185,689
Distributions	(6,990,941)	0	0	0	0	(6,990,941)
Gain attributable to noncontrolling interest	3,067,726	0	0	0	0	3,067,726
Balance, end of period at Dec. 31, 2014	83,572,600	3,706	43,122,944	32,145,662	6,853,974	1,446,314
Issued during year	254,927	19	254,908	0	0	0
Treasury shares acquired and retired	(375,208)	(26)	(375,182)	0	0	0
Net income attributable to common shareholders	916,620	0	0	916,620	0	0
Other comprehensive income (loss)
Unrealized holding income (loss) on securities net of noncontrolling and reclassification adjustment and taxes	(8,037,526)	0	0	0	(8,037,526)	0
Contributions	1,124,217	0	0	0	0	1,124,217
Distributions	(757,547)	0	0	0	0	(757,547)
Gain attributable to noncontrolling interest	289,419	0	0	0	0	289,419
Balance, end of period at Dec. 31, 2015	$ 76,987,502	$ 3,699	$ 43,002,670	$ 33,062,282	$ (1,183,552)	$ 2,102,403

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Statement of Cash Flows - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Cash flows from operating activities:
Net income attributable to common shareholders	$ 916,620	$ 6,976,016
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:
Accretion of investments	(2,753,269)	(2,161,508)
Realized investment gains, net	(4,426,593)	(17,058,173)
Unrealized trading gains included in income	945,128	722,573
Realized trading (gains) losses included in income	0	143,957
Amortization of deferred policy acquisition costs	0	369,786
Amortization of cost of insurance acquired	907,605	985,650
Depreciation	814,336	1,303,829
Net income attributable to noncontrolling interest	289,419	3,067,726
Charges for mortality and administration of universal life and annuity products	(6,640,391)	(6,651,876)
Interest credited to account balances	4,835,215	4,985,077
Change in accrued investment income (loss)	(158,473)	(229,926)
Change in reinsurance receivables	678,391	998,863
Change in policy liabilities and accruals	(3,132,596)	(5,123,893)
Change in income taxes payable	(2,552,286)	3,229,286
Change in other assets and liabilities, net	(871,642)	(5,197,626)
Net cash provided by (used in) operating activities	(11,148,536)	(13,640,239)
Proceeds from investments sold and matured:
Fixed maturities available for sale	22,484,522	44,228,405
Equity securities available for sale	8,087,827	14,686,816
Trading securities	125,774	1,992,704
Mortgage loans	20,140,224	9,040,925
Discounted mortgage loans	0	0
Real estate	19,829,665	53,674,168
Policy loans	3,102,284	3,322,613
Short term investment	4,482,329	960,148
Total proceeds from investments sold and matured	78,252,625	127,905,779
Cost of investments acquired:
Fixed maturities available for sale	(21,733,834)	(60,986,549)
Equity securities available for sale	(12,278,232)	(12,963,380)
Trading securities	(463,895)	(371,388)
Mortgage loans	(13,774,698)	(2,348,890)
Discounted mortgage loans	0	0
Real estate	(8,650,084)	(7,424,311)
Payments to Acquire Notes Receivable	(4,985,347)	0
Policy loans	(2,682,043)	(2,566,138)
Short-term investments	(100,149)	(5,342,329)
Total cost of investments acquired	(64,668,282)	(92,002,985)
Disposal (purchase) of property and equipment	0	(1,600,000)
Net cash used in investing activities	13,584,343	34,302,794
Cash flows from financing activities:
Policyholder contract deposits	5,189,311	5,304,502
Policyholder contract withdrawals	(5,514,232)	(6,323,472)
Proceeds from notes payable/line of credit	0	1,600,000
Payments of principal on notes payable/line of credit	(4,400,000)	(16,297,534)
Purchase of treasury stock	(120,281)	(927,904)
Proceeds from sale of subsidiary	0	(3,045,574)
Non-controlling distributions of consolidated subsidiary	254,567	(6,833,748)
Net cash provided by (used in) financing activities	(4,590,635)	(26,523,730)
Cash and cash equivalents at beginning of period	13,977,443	19,838,618
Cash and cash equivalents at end of period	$ 11,822,615	$ 13,977,443

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2015

Summary of Significant Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Note 1 – Summary of Significant Accounting Policies

Business – UTG, Inc. is an insurance holding company. The Company's dominant business is individual life insurance, which includes the servicing of existing insurance in-force and the acquisition of other companies in the life insurance business. UTG and its subsidiaries are collectively referred to as the "Company".

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 100.00 %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 December 31, 2015, Mr. Correll owns or controls directly and indirectly approximately 57.61 % of UTG's outstanding stock.

UTG's life insurance subsidiary has several wholly-owned and majority-owned subsidiaries. The subsidiaries were formed to hold certain real estate and other investments. The investments were placed into the limited liability companies and partnerships to provide additional protection to the policyholders and to UG.

Basis of Presentation – The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"), under guidance issued by the Financial Accounting Standards Board ("FASB").  The preparation of financial statements in accordance with GAAP requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Principles of Consolidation – The accompanying consolidated financial statements include the accounts of the Registrant and its wholly and majority-owned subsidiaries.  All significant intercompany accounts and transactions have been eliminated during consolidation.

Business Segments – The Company has only one business segment – life insurance.

Investments – The Company reports its investments as follows:

Fixed Maturity Investments – The Company classifies its fixed maturity investments, which include bonds, as available for sale. Investments classified as available for sale are carried at fair value with unrealized gains and losses, net of deferred taxes, reflected directly in accumulated other comprehensive income.  Premiums and discounts on debt securities purchased at other than par value are amortized and accreted, respectively, to interest income in the Consolidated Statements of Operations, using the constant yield method over the period to maturity.  Net realized gains and losses on sales of available for sale securities, and unrealized losses considered to be other-than-temporary, are recorded to net realized investment gains (losses) in the Consolidated Statements of Operations.

Equity Securities – Investments in equity securities, which include common and preferred stocks, are reported at fair value with unrealized gains and losses, net of deferred taxes, reflected directly in accumulated other comprehensive income (loss).

Trading Securities – Trading security investments are reported at fair value with gains and losses resulting from changes in fair value recognized in earnings. Trading securities include exchange traded equities and exchange traded options.

Mortgage Loans on Real Estate – Mortgage loans on real estate are reported at their unpaid principal balances, adjusted for amortization of premium or discount and valuation allowances. Valuation allowances are established for impaired loans when it is probable that contractual principal and interest will not be collected. Included in the mortgage loans balance is discounted mortgage loans on real estate. Discounted mortgage loans on real estate are loans that the Company purchased at a deep discount through an auction process led by the Federal Government or other intermediary.  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 adjusted for any principal receipts received.  Management works with the borrower to reach a settlement on the loan or they foreclose on the underlying collateral which is primarily commercial real estate.  For cash payments received during the work out process, the Company records these payments to interest income on a cash basis.  For loan settlements reached, the Company records the amount in excess of the carrying amount of the loan as a discount accretion to investment income at the closing date.  Management reviews the discount loan portfolio regularly for impairment.  If an impairment is identified (after consideration of the underlying collateral), the Company records an impairment to earnings in the period the information becomes known.

Investment Real Estate – Investment real estate held for sale is reported at the lower of cost or fair value less cost to sell. Expenses to maintain the property are expensed as incurred.

Notes Receivable – Notes receivable are reported at their unpaid principal balances, adjusted for valuation allowances. Valuation allowances are established for impaired loans when it is probable that contractual principal and interest will not be collected. Interest accruals are analyzed based on the likelihood of repayment. The Company does not utilize a specified number of days delinquent to cause an automatic non-accrual status.

Policy Loans – Policy loans are reported at their unpaid balances, including accumulated interest, but not in excess of the cash surrender value of the related policy.

Short-Term Investments – Short-term investments are reported at amortized cost, which approximates fair value.

Gains and Losses – Realized gains and losses include sales of investments and investment impairments.  If any, other-than-temporary impairments in fair value are recognized in net income on the specific identification basis.

Fair Value – Fair values for cash, short-term investments, short-term debt, receivables and payables approximate carrying value. Fair values for fixed maturities, equity securities and certain other assets are determined in accordance with specific accounting guidance.  Fair values are based on quoted market prices, where available.  Otherwise, fair values are based on quoted market prices of comparable instruments in active markets, quotes in inactive markets, or other observable criteria. Mortgage loans on real estate are estimated using discounted cash flow analyses. Discounted mortgage loans on real estate are reported at original purchase price, which Management believes approximates fair value.  For more specific information regarding the Company's measurements and procedures in valuing financial instruments, see Note 3 – Fair Value Measurements.

Impairment of Investments – The Company evaluates its investment portfolio for other-than-temporary impairments as described in Note 2 – Investments.  If a security is deemed to be other-than-temporarily impaired, the cost basis of the security is written down to fair value and is treated as a realized loss.

Current accounting guidance states that if an entity intends to sell or if it is more likely than not that it will be required to sell an impaired security prior to recovery of its cost basis, the security is to be considered other-than-temporarily impaired and the full amount of impairment must be charged to earnings.  Otherwise, losses on fixed maturities which are other-than-temporarily impaired are separated into two categories, the portion of the loss which is considered credit loss and the portion of the loss which is due to other factors.  The credit loss portion is charged to earnings while the loss due to other factors is charged to other comprehensive income.

Cash Equivalents – The Company considers certificates of deposit and other short-term instruments with an original purchased maturity of three months or less to be cash equivalents.

Cash – Cash consists of balances on hand and on deposit in banks and financial institutions.

Reinsurance - In the normal course of business, the Company seeks to limit its exposure to loss on any single insured and to recover a portion of benefits paid by ceding reinsurance to other insurance enterprises or reinsurers under excess coverage and coinsurance contracts.  The Company retains a maximum of  $125,000 of coverage per individual life.

Reinsurance receivables are recognized in a manner consistent with the liabilities relating to the underlying reinsured contracts. The cost of reinsurance related to long-duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies.

Cost of Insurance Acquired - When an insurance company is acquired, the Company assigns a portion of its cost to the right to receive future cash flows from insurance contracts existing at the date of the acquisition. The cost of policies purchased represents the actuarially determined present value of the projected future profits from the acquired policies. 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 amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised.

Property and Equipment - Company-occupied property, data processing equipment and furniture and office equipment are stated at cost less accumulated depreciation of  $3,323,718 and $3,868,331 at December 31, 2015 and 2014, respectively. Depreciation is computed on a straight-line basis for financial reporting purposes using estimated useful lives of  three to thirty years.  Depreciation expense was $139,218 and $309,279 for the years ended December 31, 2015 and 2014, respectively.

Future Policy Benefits and Expenses - The liabilities for traditional life insurance and accident and health insurance policy benefits are computed using a net level method. These liabilities include assumptions as to investment yields, mortality, withdrawals, and other assumptions based on the life insurance subsidiary's experience adjusted to reflect anticipated trends and to include provisions for possible unfavorable deviations. The Company makes these assumptions at the time the contract is issued or, in the case of contracts acquired by purchase, at the purchase date.  Future policy benefits for individual life insurance and annuity policies are computed using interest rates ranging from 2% to 6% for life insurance and 2.5% to 7.50% for annuities. Benefit reserves for traditional life insurance policies include certain deferred profits on limited-payment policies that are being recognized in income over the policy term. Policy benefit claims are charged to expense in the period that the claims are incurred. The mortality rate assumptions for policies currently issued by the Company are based on 2001 select and ultimate tables.  Withdrawal rate assumptions are based upon Linton B or C, which are industry standard actuarial tables for forecasting assumed policy lapse rates.

Benefit reserves for universal life insurance and interest sensitive life insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges.  Policy benefits and claims that are charged to expense include benefit claims in excess of related policy account balances.  Interest crediting rates for universal life and interest sensitive products range from 4.0% to 5.5% as of December 31, 2015 and 2014.

Policy Claims and Benefits Payable - Policy and contract claims include provisions for reported claims in process of settlement, valued in accordance with the terms of the policies and contracts, as well as provisions for claims incurred and unreported. The estimate of incurred and unreported claims is based on prior experience. The Company makes an estimate after careful evaluation of all information available to the Company.  There is no certainty the stated liability for policy claims and benefits payable, including the estimate for incurred but unreported claims, will be the Company's ultimate obligation.

Income Taxes – Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement book values and tax bases of assets and liabilities.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  More information concerning income taxes is provided in Note 6 – Income Taxes.

Earnings Per Share – The objective of both basic earnings per share ("EPS") and diluted EPS is to measure the performance of an entity over the reporting period.  The Company presents basic and diluted EPS on the face of the Consolidated Statements of Operations. Basic EPS is computed by dividing income available to common shareholders by the weighted average common shares outstanding for the period.  Diluted EPS is calculated by adding to shares outstanding the additional net effect of potentially dilutive securities or contracts, such as stock options, which could be exercised or converted into common shares.

Recognition of Revenues and Related Expenses - Premiums for traditional life insurance products, which include those products with fixed and guaranteed premiums and benefits, consist principally of whole life insurance policies, and certain annuities with life contingencies are recognized as revenues when due. Limited payment life insurance policies defer gross premiums received in excess of net premiums, which is then recognized in income in a constant relationship with insurance in-force. Accident and health insurance premiums are recognized as revenue pro rata over the terms of the policies. Benefits and related expenses associated with the premiums earned are charged to expense proportionately over the lives of the policies through a provision for future policy benefit liabilities and through deferral and amortization of deferred policy acquisition costs. For universal life and investment products, generally there is no requirement for payment of premium other than to maintain account values at a level sufficient to pay mortality and expense charges. Consequently, premiums for universal life policies and investment products are not reported as revenue, but as deposits. Policy fee revenue for universal life policies and investment products consists of charges for the cost of insurance and policy administration fees assessed during the period. Expenses include interest credited to policy account balances and benefit claims incurred in excess of policy account balances.

Recently Issued Accounting Standards

Accounting Standards Update (ASU) 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities – ASU 2016-01 makes targeted improvements to existing U.S. GAAP for financial instruments, including requiring equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; requiring entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; requiring separate presentation of financial assets and financial liabilities by measurement category and form of financial asset and requiring entities to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk (also referred to as "own credit") when the organization has elected to measure the liability at fair value in accordance with the fair value option. The new guidance is effective for public companies for fiscal years beginning after December 15, 2017. Early adoption of the own credit provision is permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements.

Accounting Standards Update (ASU) 2015-17, Income Taxes: Balance Sheet Classification of Deferred Taxes – ASU 2015-17 simplifies the presentation of deferred income taxes to require that deferred tax assets and liabilities be classified as non-current in a classified balance sheet. Current U.S. GAAP requires an entity to separate deferred income tax assets and liabilities into current and non-current amounts in a classified balance sheet. The current requirement that deferred tax assets and liabilities of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments of this Update.  For public companies, the guidance is ASC 2015-17 is effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Earlier adoption is permitted. The adoption of this guidance is not expected to have a material impact on the Company's consolidated financial statements.

Accounting Standards Update (ASU) 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis – ASU 2015-02 makes changes to both the variable interest model and voting interest model and eliminates the indefinite deferral of FASB Statement No. 167, included in ASU 2010-10, for certain investment funds. All reporting entities that hold a variable interest in other legal entities will need to re-evaluate their consolidation conclusions as well as disclosure requirements. This ASU is effective for annual periods beginning after December 15, 2015, and early adoption is permitted, including any interim period. This is not expected to have a material impact on the financial statements of the Company.

Accounting Standards Update (ASU) 2015-01, Income Statement – Extraordinary and Unusual Items – ASU 2015-01 removes the concept of extraordinary items from U.S. GAAP.  Under the existing guidance, an entity is required to separately disclose extraordinary items, net of tax, in the income statement after income from continuing operations if an event or transaction is unusual and occurs infrequently.  This separate, net-of-tax presentation will no longer be allowed.  The existing requirement to separately disclose events or transactions that are unusual or occur infrequently on a pre-tax basis within continuing operations in the income statement has been retained.  The new guidance requires similar separate presentation of items that are both unusual and infrequent.  The new standard is effective for periods beginning after December 15, 2015.  Early adoption is permitted, but only as of the beginning of the fiscal year of adoption.  Upon adoption, the Company will present transactions that are both unusual and infrequent, if any, on a pre-tax basis within continuing operations in the Consolidated Statements of Operations.

Reclassifications – Certain reclassifications have been made to the 2014 consolidated financial statements to make them comparable to the current year consolidated financial statements.

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INVESTMENTS

12 Months Ended

Dec. 31, 2015

INVESTMENTS [Abstract]

INVESTMENTS

Note 2 – Investments

Available for Sale Securities – Fixed Maturity and Equity Securities

The following tables provide a summary of fixed maturities available for sale and equity securities by original or amortized cost and estimated fair value:

December 31, 2015	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	$	20,336,681	$	1,441,890	$	(32,083	)	$	21,746,488
U.S. special revenue and assessments		1,137,546		7,843		(2,550	)		1,142,839
All other corporate bonds		167,173,444		3,762,156		(8,705,830	)		162,229,770
		188,647,671		5,211,889		(8,740,463	)		185,119,097
Equity securities		43,954,737		2,119,205		(388,602	)		45,685,340
Total	$	232,602,408	$	7,331,094	$	(9,129,065	)	$	230,804,437

December 31, 2014	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	$	23,036,161	$	1,970,791	$	(50,184	)	$	24,956,768
States, municipalities and political subdivisions		95,000		2,385		0			97,385
U.S. special revenue and assessments		1,137,702		13,739		(202,930	)		948,511
Collateralized mortgage obligations		1,005,081		92,091		(6	)		1,097,166
Public utilities		399,927		55,913		0			455,840
All other corporate bonds		162,960,493		8,624,486		(1,659,193	)		169,925,786
		188,634,364		10,759,405		(1,912,313	)		197,481,456
Equity securities		39,275,638		2,260,855		(540,491	)		40,996,002
Total	$	227,910,002	$	13,020,260	$	(2,452,804	)	$	238,477,458

The following table provides a summary of fixed maturities by contractual maturity as of  December 31, 2015. Actual maturities could differ from contractual maturities due to call or prepayment provisions:

Fixed Maturities Available for Sale December 31, 2015	Amortized Cost		Estimated Fair Value
Due in one year or less	$	3,961,534	$	4,000,512
Due after one year through five years		23,444,519		24,343,844
Due after five years through ten years		64,352,687		62,094,221
Due after ten years		96,888,931		94,680,520
Total	$	188,647,671	$	185,119,097

By insurance statute, the majority of the Company's investment portfolio is invested in investment grade securities to provide ample protection for policyholders.

Below investment grade debt securities generally provide higher yields and involve greater risks than investment grade debt securities because their issuers typically are more highly leveraged and more vulnerable to adverse economic conditions than investment grade issuers. In addition, the trading market for these securities is usually more limited than for investment grade debt securities. Debt securities classified as below-investment grade are those that receive a Standard & Poor's rating of BB+ or below.

The Company held below investment grade investments with an estimated market value of $13,352,934 and $9,142,063 as of December 31, 2015 and 2014, respectively. The investments are all classified as "All other corporate bonds".

The fair value of investments with sustained gross unrealized losses at December 31, 2015 and 2014 are as follows:

December 31, 2015	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	$	4,966,210	(32,083)	$	0	0	$	4,966,210	(32,083)
U.S. special revenue and assessments		984,770	(2,550)		0	0		984,770	(2,550)
All other corporate bonds		85,734,097	(5,255,276)		19,400,640	(3,450,554)		105,134,737	(8,705,830)
Total fixed maturities	$	91,685,077	(5,289,909)	$	19,400,640	(3,450,554)	$	111,085,717	(8,740,463)
Equity securities	$	4,741,132	(388,602)	$	0	0	$	4,741,132	(388,602)

December 31, 2014	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		0	0		4,947,265	(50,184)		4,947,265	(50,184)
U.S. special revenue and assessments		0	0		784,390	(202,930)		784,390	(202,930)
Collateralized mortgage obligations		0	0		1,012	(6)		1,012	(6)
All other corporate bonds	$	28,954,477	(416,560)	$	3,535,206	(1,242,633)	$	32,489,683	(1,659,193)
Total fixed maturities	$	28,954,477	(416,560)	$	9,267,873	(1,495,753)	$	38,222,350	(1,912,313)
Equity securities	$	6,067,132	(540,491)	$	0	0	$	6,067,132	(540,491)

The following table provides additional information regarding the number of securities that were in an unrealized loss position for greater than or less than twelve months:

	Less than 12 months	12 months or longer	Total
As of December 31, 2015
Fixed maturities	40	9	49
Equity securities	9	0	9
As of December 31, 2014
Fixed maturities	18	7	25
Equity securities	25	0	25

Substantially all of the unrealized losses on fixed maturities available for sale at December 31, 2015 and 2014 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 December 31, 2015 and 2014

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 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 December 31, 2015 was $0 and $(28,609), respectively. The fair value of derivatives included in trading security assets and trading security liabilities as of December 31, 2014 was $6,250 and $(23,853), 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.

As of June 30, 2015, the Company reclassified its remaining exchange-traded equity trading security to the available for sale category. The fair value of the security at the time of the reclassification was $3,224,000.  Trading securities are purchased and held primarily for purposes of selling them in the near term and reflect active and frequent buying and selling. Management analyzed the recent buying and selling activity related to the exchange-traded equity and deems the available for sale category to better reflect Management's intent for this security going forward. Through June 30, 2015, unrealized gains and losses from this exchange-traded equity were recorded as a component of earnings. Subsequent unrealized gains/losses are reported as a component of comprehensive income.

The following table reflects trading securities revenue charged to net investment income for the periods ended December 31:

	2015				2014
Net unrealized gains (losses)		$	945,128			$	(722,573	)
Net realized gains (losses)			(515,967	)			245,995
Net unrealized and realized gains (losses)		$	429,161			$	(476,578	)

Mortgage Loans on Real Estate

The Company, from time to time, acquires mortgage loans through participation agreements with FSNB. FSNB has been able to provide the Company with additional expertise and experience in underwriting commercial and residential mortgage loans, which provide more attractive yields than the traditional bond market. The Company is able to receive participations from FSNB for three primary reasons: 1) FSNB has already reached its maximum lending limit to a single borrower, but the borrower is still considered a suitable risk; 2) the interest rate on a particular loan may be fixed for a long period that is more suitable for UG given its asset-liability structure; and 3) FSNB's loan growth might at times outpace its deposit growth, resulting in FSNB participating such excess loan growth rather than turning customers away. For originated loans, the Company's Management is responsible for the final approval of such loans after evaluation. Before a new loan is issued, the applicant is subject to certain criteria set forth by Company Management to ensure quality control. These criteria include, but are not limited to, a credit report, personal financial information such as outstanding debt, sources of income, and personal equity. Once the loan is approved, the Company directly funds the loan to the borrower. The Company bears all risk of loss associated with the terms of the mortgage with the borrower.

Approximately 30% and 39% of the mortgage loan portfolio consists of discounted commercial mortgage loans as of December 31, 2015 and 2014, respectively. The Company began purchasing discounted commercial mortgage loans in 2009. Management has extensive background and experience in the analysis and valuation of commercial real estate. The discounted loans are available through the FDIC's sale of assets of closed banks and from banks wanting to reduce their loan portfolios. The loans are available on a loan by loan bid process. Once a loan has been acquired, contact is made with the appropriate individuals to begin a dialog with a goal of determining the borrower's willingness to work together. There are generally three paths a discounted loan will take: the borrowers pay as required; a settlement is reached with the loan being paid off at a discounted value; or the loan is foreclosed.

During 2015 and 2014, the Company acquired $13,774,698 and $2,348,890 in mortgage loans, respectively, including both regular participation mortgage loans as well as discounted mortgage loans.  FSNB services the majority of the Company's mortgage loan portfolio. The Company pays FSNB a .25% servicing fee on these loans and a one-time fee at loan origination of .50% of the original loan cost to cover costs incurred by FSNB relating to the processing and establishment of the loan.

During 2015 and 2014, the maximum and minimum lending rates for mortgage loans were:

	2015		2014
	Maximum rate	Minimum rate	Maximum rate	Minimum rate
Commercial Loans	8.00 %	4.00 %	10.00 %	3.91 %
Residential Loans	8.00 %	3.00 %	8.00 %	7.00 %

Most mortgage loans are first position loans.  Loans issued are generally limited to no more than 80% of the appraised value of the property.

The Company has in place a monitoring system to provide Management with information regarding potential troubled loans. Letters are sent to each mortgagee when the loan becomes 30 days or more delinquent. Management is provided with a monthly listing of loans that are 60 days or more past due along with a brief description of what steps are being taken to resolve the delinquency. All loans 90 days or more past due are placed on a non-performing status and classified as delinquent loans. Quarterly, coinciding with external financial reporting, the Company reviews each delinquent loan and determines how each delinquent loan should be classified. Management believes the current internal controls surrounding the mortgage loan selection process provide a quality portfolio with minimal risk of foreclosure and/or negative financial impact.

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. The Company records repayments on loans as discount accrual when the loan basis has been paid in full.

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 acquired 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 not currently paying are being vigorously worked by Management.  The current discounted commercial mortgage loan portfolio has an average price of 39.0 % 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.  The mortgage loan reserve was $0 at December 31, 2015 and 2014.

The following table summarizes the number of loans held in the discounted mortgage loan portfolio and the carrying value of the loans as of December 31, 2015:

Payment Frequency	Number of Loans		Carrying Value
No payments received		8	$	0
One-time payment received		1		0
Irregular payments received		2		20,834
Periodic payments received		7		5,347,215
Total		18	$	5,368,049

The following table summarizes the mortgage loan holdings of the Company for the periods ended December 31:

	2015		2014
In good standing	$	14,701,228	$	14,443,455
Overdue interest over 90 days		20,834		3,130,290
Restructured		126,118		1,104,972
In process of foreclosure		2,921,750		4,483,265
Total mortgage loans	$	17,769,930	$	23,161,982
Total foreclosed  loans during the year	$	0	$	56,576

Investment Real Estate

Real estate acquired through foreclosure, consisting of properties obtained through foreclosure proceedings or acceptance of a deed in lieu of foreclosure, is reported on an individual asset basis at the lower of cost or fair value, less disposal costs. Fair value is determined on the basis of current appraisals, comparable sales, and other estimates of value obtained principally from independent sources. When properties are acquired through foreclosure, any excess of the loan balance at the time of foreclosure over the fair value of the real estate held as collateral is recognized and charged to the Consolidated Statements of Operations. Based upon Management's evaluation of the real estate acquired through foreclosure, additional expense is recorded when necessary in an amount sufficient to reflect any declines in estimated fair value. Gains and losses recognized on the disposition of the properties are recorded as realized gains and losses in the Consolidated Statements of Operations.

Notes Receivable

Notes receivable represent collateral loans and promissory notes issued by the Company and are reported at their unpaid principal balances, adjusted for valuation allowances. Valuation allowances are established for impaired loans when it is probable that contractual principal and interest will not be collected. The valuation allowance as of December 31, 2015 and 2014 was $0. Interest accruals are analyzed based on the likelihood of repayment.  The Company does not utilize a specified number of days delinquent to cause an automatic non-accrual status.

Before a new note is issued, the applicant is subject to certain criteria set forth by Company Management to ensure quality control.  Once the note is approved, the Company directly funds the note to the borrower. Several of the notes have participation agreements in place, whereas the Company has reduced its investment in the note receivable by participating a portion of the note to a third party.

Similar to the mortgage loans, FSNB services several of the notes receivable. The Company, and the participants in the notes, share in the risk of loss associated with the terms of the note with the borrower, based upon their ownership percentage in the note.  The Company has in place a monitoring system to provide Management with information regarding potential troubled loans. 

Analysis of Investment Operations

The following table reflects the Company's net investment income for the periods ended December 31:

	2015			2014
Fixed maturities	$	8,559,938		$	8,225,640
Equity securities		1,708,786			3,255,611
Trading securities		(429,161	)		(476,578	)
Mortgage loans		5,700,492			4,592,853
Real estate		1,474,726			8,355,153
Notes receivable		787,658			340,000
Policy loans		720,544			760,715
Cash and cash equivalents		681			505
Short-term		699,357			70,578
Total consolidated investment income		19,223,021			25,124,477
Investment expenses		(3,663,086	)		(8,774,758	)
Consolidated net investment income	$	15,559,935		$	16,349,719

The following table reflects the Company's net realized investments gains and losses for the periods ended December 31:

2015	Gross Realized Gains		Gross Realized (Losses)		Net Realized Gains (Losses)
Fixed maturities	$	1,289,455	$	(41,215)	$	1,248,240
Real estate		5,968,558		0		5,968,558
Common stock		48,165		(238,794)		(190,629)
Preferred stock		971,662		(637)		971,025
Real estate – OTTI		0		(54,901)		(54,901)
Common stock – OTTI		0		(3,515,700)		(3,515,700)
Total realized gains (losses)	$	8,277,840	$	(3,851,247)	$	4,426,593

2014	Gross Realized Gains		Gross Realized (Losses)		Net Realized Gains (Losses)
Fixed maturities	$	2,414,160	$	(1,135,417)	$	1,278,743
Real estate		14,757,451		(1,460,332)		13,297,119
Common stock		673,821		(14,908)		658,913
Preferred stock		1,986,303		0		1,986,303
Real estate – OTTI		0		(35,946)		(35,946)
Common stock – OTTI		0		(126,959)		(126,959)
Total realized gains (losses)	$	19,831,735	$	(2,773,562)	$	17,058,173

Other-Than-Temporary Impairments

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 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 Consolidated Statements of Operations.

Management regularly reviews its real estate portfolio in comparison to appraisal valuations and current market conditions for indications of other-than-temporary impairments. If a decline in value is judged by Management to be other-than-temporary, a loss is recognized by a charge to other-than-temporary impairment losses in the 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 Consolidated Statements of Operations for the periods ended December 31:

	2015		2014
Other than temporary impairments:
Common stock	$	3,515,700	$	126,959
Real estate		54,901		35,946
Total other than temporary impairments	$	3,570,601	$	162,905

The other-than-temporary impairments recognized during 2015 and 2014 were taken as a result of Management's assessment and consideration of the length of time the securities have remained in an unrealized loss position and as a result of management's analysis and determination of value. The investments were written down to better reflect their current expected market value.

Investments on Deposit

The Company had investments with a fair value of $8,932,241 and $10,635,716 on deposit with various state insurance departments as of December 31, 2015 and 2014, respectively.

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FAIR VALUE MEASUREMENTS

12 Months Ended

Dec. 31, 2015

FAIR VALUE MEASUREMENTS [Abstract]

FAIR VALUE MEASUREMENTS

Note 3 – Fair Value Measurements

The Company measures its assets and liabilities recorded at fair value in the 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 and financial institutions. 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 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 following table presents the Company's assets and liabilities measured at fair value in the consolidated balance sheet on a recurring basis as of December 31, 2015.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	10,459,758	$	173,632,645	$	1,026,694	$	185,119,097
Equity Securities, available for sale		13,312,331		5,567,061		26,805,948		45,685,340
Total		23,772,089		179,199,706		27,832,642		230,804,437
Liabilities
Trading Securities	$	28,609	$	0	$	0	$	28,609

The following table presents the Company's assets and liabilities measured at fair value in the consolidated balance sheet on a recurring basis as of December 31, 2014.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	13,374,878	$	183,236,853	$	869,725	$	197,481,456
Equity Securities, available for sale		4,756,292		7,361,076		28,878,634		40,996,002
Trading Securities		3,826,250		0		0		3,826,250
Total	$	21,957,420	$	190,597,929	$	29,748,359	$	242,303,708
Liabilities
Trading Securities	$	23,853	$	0	$	0	$	23,853

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, 2014	$	869,725		$	28,878,634		$	29,748,359
Transfers in to Level 3		0			0			0
Total unrealized gains or (losses):
Included in realized gains (losses)		67,905			-			67,905
Included in other comprehensive income		210,819			270,670			481,489
Purchases		0			1,920,607			1,920,607
Sales		(121,755	)		(4,263,963	)		(4,385,718	)
Balance at December 31, 2015	$	1,026,694		$	26,805,948		$	27,832,642

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. The Company computed fair value of Level 3 equity investments based on a review of current financial information, earnings trends and similar companies in the same industries.

There were no transfers in or out of Level 3 as of December 31, 2015.  Transfers occur when there is a lack of observable market information.

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 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 Consolidated Balance Sheets are shown below. Because the fair value for all 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.

	December 31, 2015				December 31, 2014
Assets	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Mortgage loans on real estate	$	17,769,930	$	17,775,178	$	23,161,982	$	23,337,728
Investment real estate		47,650,102		47,650,102		51,007,101		51,007,101
Notes receivable		10,597,907		10,597,907		5,612,560		5,612,560
Policy loans		10,684,244		10,684,244		11,104,485		11,104,485
Cash and cash equivalents		11,822,615		11,822,615		13,977,443		13,977,443
Short term investments		0		0		4,382,181		4,382,181
Liabilities
Notes payable		0		0		4,400,000		4,400,000

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.

A portion of the mortgage loans balance consists of discounted mortgage loans. 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.

Notes receivable are carried at their unpaid principal balances, which approximates fair value. The inputs used to measure the fair value of the loans 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 Consolidated Balance Sheets 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 Consolidated Balance Sheets 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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REINSURANCE

12 Months Ended

Dec. 31, 2015

REINSURANCE [Abstract]

REINSURANCE

Note 4 - Reinsurance

As is customary in the insurance industry, the insurance subsidiary cedes insurance to, and assumes insurance from, other insurance companies under reinsurance agreements. Reinsurance agreements are intended to limit a life insurer's maximum loss on a large or unusually hazardous risk or to obtain a greater diversification of risk. The ceding insurance company remains primarily liable with respect to ceded insurance should any reinsurer be unable to meet the obligations assumed by it. However, it is the practice of insurers to reduce their exposure to loss to the extent that they have been reinsured with other insurance companies. The Company sets a limit on the amount of insurance retained on the life of any one person. The Company will not retain more than $125,000, including accidental death benefits, on any one life. At December 31, 2015, the Company had gross insurance in-force of $1.3 billion of which approximately $272 million was ceded to reinsurers.  At December 31, 2014, the Company had gross insurance in-force of $1.4 billion of which approximately $287 million was ceded to reinsurers.

The Company's reinsured business is ceded to numerous reinsurers. The Company monitors the solvency of its reinsurers in seeking to minimize the risk of loss in the event of a failure by one of the parties. The Company is primarily liable to the insureds even if the reinsurers are unable to meet their obligations. The primary reinsurers of the Company are large, well-capitalized entities.

Most recently, UG utilized reinsurance agreements with Optimum Re Insurance Company ("Optimum"), and Swiss Re Life and Health America Incorporated ("SWISS RE"). Optimum and SWISS RE currently hold an "A-" (Excellent) and "A+" (Superior) rating, respectively, from A.M. Best, an industry rating company. The reinsurance agreements were effective December 1, 1993, and covered most new business of UG. Under the terms of the agreements, UG cedes risk amounts above its retention limit of $100,000 with a minimum cession of $25,000. Ceded amounts are shared equally between the two reinsurers on a yearly renewable term ("YRT") basis, a common industry method. The treaty is self-administered; meaning the Company records the reinsurance results and reports them to the reinsurers.

Also, Optimum is the reinsurer of 100% of the accidental death benefits ("ADB") in force of UG.  This coverage is renewable annually at the Company's option.  Optimum specializes in reinsurance agreements with small to mid-size carriers such as UG.

UG entered into a coinsurance agreement with Park Avenue Life Insurance Company ("PALIC") effective September 30, 1996.  Under the terms of the agreement, UG ceded to PALIC substantially all of its then in-force paid-up life insurance policies.  Paid-up life insurance generally refers to non-premium paying life insurance policies.  Under the terms of the agreement, UG sold 100 % of the future results of this block of business to PALIC through a coinsurance agreement.  UG continues to administer the business for PALIC and receives a servicing fee through a commission allowance based on the remaining in-force policies each month.  PALIC has the right to assumption reinsure the business, at its option, and transfer the administration.  The Company is not aware of any such plans.  PALIC's ultimate parent, The Guardian Life Insurance Company of America ("Guardian"), currently holds an "A++" (Superior) rating from A.M. Best.  The PALIC agreement accounts for approximately 63 % of UG's reinsurance reserve credit, as of December 31, 2015 and 2014.

At December 31, 1992, UG (formerly American Capitol) entered into a reinsurance agreement with Canada Life Assurance Company ("the Canada Life agreement") that fully reinsured virtually all of its traditional life insurance policies. The reinsurer's obligations under the Canada Life agreement were secured by assets withheld by UG representing policy loans and deferred and uncollected premiums related to the reinsured policies. UG continues to administer the reinsured policies. At December 31, 2013, the Canada Life agreement had insurance in-force of approximately $6,815,000, with no reserve credit being taken on that amount.  The Canada Life agreement was fully repaid in August 2012. With the reinsurance recaptured by the Company, a 15 % profit share will continue to be paid to the reinsurer going forward relative to the block of business.  Effective July 1, 2014, the Company acquired the 15% profit share on this block of business from Canada Life for $300,000. This payment effectively settled any future obligations of the Company to the reinsurer under this agreement.

During 2014, the Company disposed of a block of business through an assumption reinsurance agreement, whereby the Company transferred cash of $3,000,000 and extinguished reserves of $3,600,000and reduced cost of insurance acquired by $600,000.

On September 30, 1998, UG entered into a coinsurance agreement with The Independent Order of Vikings, (IOV) an Illinois fraternal benefit society.  Under the terms of the agreement, UG agreed to assume, on a coinsurance basis, 25% of the reserves and liabilities arising from all in-force insurance contracts issued by the IOV to its members.  At December 31, 2015, the IOV insurance in-force assumed by UG was approximately $1,451,000, with reserves being held on that amount of approximately $350,000. At December 31, 2014, the IOV insurance in-force assumed by UG was approximately $1,503,000, with reserves being held on that amount of approximately $346,000.

The Company does not have any short-duration reinsurance contracts.  The effect of the Company's long-duration reinsurance contracts on premiums earned in 2015 and 2014 were as follows:

	2015 Premiums Earned			2014 Premiums Earned
Direct	$	11,140,000		$	11,642,000
Assumed		25,000			26,000
Ceded		(3,091,000	)		(3,127,000	)
Net Premiums	$	8,074,000		$	8,541,000

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COST OF INSURANCE ACQUIRED

12 Months Ended

Dec. 31, 2015

Cost of Insurance Acquired [Abstract]

Schedule of cost of insurance acquired

Note 5 – Cost of Insurance Acquired

When an insurance company is acquired, the Company assigns a portion of its cost to the right to receive future cash flows from insurance contracts existing at the date of the acquisition.  The cost of policies purchased represents the actuarially determined present value of the projected future profits from the acquired policies.  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 utilized may vary due to differences in the blocks of business.  The interest rate utilized in the amortization calculation of the remaining cost of insurance acquired is 12%. The amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised.

	2015			2014
Cost of insurance acquired, beginning of year	$	9,047,984		$	10,636,412
Sale of block of business		0			(602,778	)
Interest accretion		1,180,703			1,298,980
Amortization		(2,088,308	)		(2,284,630	)
Net amortization		(907,605	)		(985,650	)
Cost of insurance acquired, end of year	$	8,140,379		$	9,047,984

Estimated net amortization expense of cost of insurance acquired for the next five years is as follows:

	Interest Accretion	Amortization	Net Amortization
2016	1,072,000	1,945,000	873,000
2017	967,000	1,806,000	839,000
2018	866,000	1,672,000	806,000
2019	770,000	1,546,000	776,000
2020	677,000	1,421,000	744,000

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INCOME TAXES

12 Months Ended

Dec. 31, 2015

INCOME TAXES [Abstract]

INCOME TAXES

Note 6 – Income Taxes

UTG and UG file separate federal income tax returns.

Income tax expense (benefit) consists of the following components:

	2015				2014
Current tax		$	747,714			$	3,233,286
Deferred tax			(1,680,429	)			(2,150,359	)
Income tax expense (benefit)		$	(932,715	)		$	1,082,927

The expense for income differed from the amounts computed by applying the applicable United States statutory rate of 35% before income taxes as a result of the following differences:

	2015			2014
Tax computed at statutory rate	$	95,663		$	3,894,334
Changes in taxes due to:
Non-controlling interest		(101,297	)		(1,073,704	)
Current period loss for which no tax benefit was recognized		17,693			17,401
Small company deduction		(552,694	)		(134,653	)
Dividend received deduction		(100,349	)		(1,414,353	)
Other		(291,731	)		(206,098	)
Income tax expense (benefit)	$	(932,715	)	$	1,082,927

The following table summarizes the major components that comprise the deferred tax liability as reflected in the balance sheets:

	2015			2014
Investments	$	(2,735,072	)	$	2,728,928
Cost of insurance acquired		2,849,133			3,166,794
Management/consulting fees		(55,125	)		(57,454	)
Future policy benefits		1,546,770			1,778,105
Deferred gain on sale of subsidiary		2,312,483			2,312,483
Other liabilities		27,406			(127,461	)
Federal tax DAC		(540,128	)		(387,601	)
Deferred tax liability	$	3,405,467		$	9,413,794

At December 31, 2015 and 2014, the Company had gross deferred tax assets of $4,896,464 and $2,405,249, respectively, and gross deferred tax liabilities of $8,301,931 and $11,819,043, respectively, resulting from temporary differences primarily related to the life insurance subsidiary.  A valuation allowance is to be provided when it is more likely than not that deferred tax assets will not be realized by the Company. No valuation allowance has been recorded (except as noted below) relating to the Company's deferred tax assets since, in Management's judgment, the Company will more likely than not have sufficient taxable income in future periods to fully realize its existing deferred tax assets.

As of December 31, 2015 and 2014, the Company had a deferred tax asset of $35,094 and $17,401, respectively, relating to a net operating loss carryforward.  The Company established an allowance of $35,094and $17,401against this deferred tax asset as of December 31, 2015 and 2014, respectively.  The Company also has a deferred tax asset of $118,693and $0 relating to an AMT tax carryforward as of December 31, 2015 and 2014, respectively.  The Company established an allowance of $118,693 against this deferred tax asset as of December 31, 2015.  The allowances were established based on Management's assessment of the recoverability of these deferred assets.

The Company's Federal income tax returns are periodically audited by the Internal Revenue Service ("IRS"). In February 2011, the IRS audited UTG's 2009 federal income tax return. The examination was closed with no adjustments to the return. There are currently no examinations in process, nor is Management aware of any pending examination by the IRS. The Company follows the accounting guidance for uncertainty in income taxes using the provisions of Financial Accounting Standards Board ("FASB") ASC 740, Income Taxes.  Using that guidance, tax positions initially need to be recognized in the financial statements when it is more-likely-than-not the position will be sustained upon examination by the tax authorities.  Such tax positions initially and subsequently need to be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.  The Company has evaluated its tax positions, expiring statutes of limitations, changes in tax law and new authoritative rulings and believes that no disclosure relative to a provision of income taxes is necessary, at this time, to cover any uncertain tax positions.

The Company classifies interest and penalties on underpayment of income taxes as income tax expense. No interest or penalties were included in the reported income taxes for the years presented. The Company is not aware of any potential or proposed changes to any of its tax filings.

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CREDIT ARRANGEMENTS

12 Months Ended

Dec. 31, 2015

CREDIT ARRANGEMENTS [Abstract]

CREDIT ARRANGEMENTS

Note 7 – Credit Arrangements

At December 31, 2015 and 2014, the Company had the following outstanding debt:

			Outstanding Principal Balance
Instrument	Issue Date	Maturity Date	December 31, 2015			December 31, 2014
Promissory Note:
UTG Avalon	12/29/2014	4/1/2018		$	0		$	4,400,000

Instrument	Issue Date	Maturity Date	Revolving Credit Limit			December 31, 2014			Borrowings		Repayments		December 31, 2015
Lines of Credit:
UTG	11/20/2013	11/20/2015		$	8,000,000		$	0		0		0		$	0
UG	6/2/2015	5/19/2016			10,000,000			0		0		0			0

The UTG Avalon promissory note issued on December 29, 2014 carried interest at a rate of 3.50 % with interest payable quarterly beginning in July of 2015.  The interest is a variable rate that is equal to 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 any change in interest rate is effective the first day of the month following the rate change. Principal is due upon maturity of the note. This note was fully repaid during the third quarter of 2015.  The principal payments were paid by UTG and as a result of the payments; intercompany promissory notes receivable/payable were established.

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").

During June of 2015, the Federal Home Loan Bank approved UG's Cash Management Advance Application ("CMA"). The CMA gives the Company the option of selecting a variable rate of interest for up to 90 days or a fixed rate for a maximum of 30 days. The variable rate CMA is prepayable at any time without a fee, while the fixed CMA is not prepayable prior to maturity.

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COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2015

COMMITMENTS AND CONTINGENCIES [Abstract]

COMMITMENTS AND CONTINGENCIES

Note 8 – 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 material 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.

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.

The following table represents the total funding commitments and the unfunded commitment as of December 31, 2015 related to certain investments:

	Total Funding Commitment		Unfunded Commitment
RLF III, LLC	$	4,000,000	$	398,120
Llano Music, LLC		4,000,000		1,179,000
Sovereign's Capital, LP Fund I		500,000		125,000
UGLIC, LLC		1,600,000		120,000
Sovereign's Capital, LP Fund II		1,000,000		810,000

During 2006, the Company committed to invest in RLF III, LLC ("RLF"), which makes land-based investments in undervalued assets. RLF makes 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.  The Company increased its funding commitment by $2,000,000 during 2014. Llano made capital calls to its investors as funds are needed to acquire the royalty rights. The Llano funding commitment expired in January of 2016. Upon expiration of the Llano funding commitment, the Company committed funds to a related entity, Barton Springs Music, LLC, which also invests in music royalties.

During 2012, the Company committed to invest in Sovereign's Capital, LP Fund I ("Sovereign's"), which invests in companies in emerging markets. Sovereign's makes capital calls to investors as funds are needed.

During 2014, the Company committed to invest in UGLIC, LLC, which purchases real estate tax receivables. UGLIC, LLC makes capital calls as funds are needed for additional purchases.

During 2015, the Company committed to invest in Sovereign's Capital, LP Fund II ("Sovereign's II"), which invests in companies in emerging markets. Sovereign's II makes capital calls to investors as funds are needed.

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SHAREHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2015

SHAREHOLDERS' EQUITY [Abstract]

CAPITAL STOCK TRANSACTIONS

Note 9 – Shareholders' Equity

Stock Repurchase Program – The Board of Directors of UTG has authorized the repurchase in the open market or in privately negotiated transactions of UTG's common stock. At a meeting of the Board of Directors on June 3, 2015, the Board of Directors of UTG authorized the repurchase of up to an additional $1,000,000 of UTG's common stock, for a total, repurchase of $8,000,000. Repurchased shares are available for future issuance for general corporate purposes. This program can be suspended or terminated at any time without further notice. 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 2015, the Company repurchased 25,919 shares through the stock repurchase program for $375,207. Through December 31, 2015, UTG has spent $6.5 million in the acquisition of 688,617 shares under this program.

On July 20, 2015 the Board of Directors of UTG also clarified and amended the terms on which UTG may repurchase shares in the program and gave Company Management broad authority to operate the program, including the discretion of whether to purchase shares and the ability to suspend or terminate the program. The program may be suspended or terminated at any time without further notice.

Director Compensation - Effective September 18, 2013, each outside Director will annually receive $8,000 as a retainer and $1,000 per meeting attended.  The compensation, however, shall be paid in UTG common stock.  The value will be determined annually on the close of business December 20th or the next business day should December 20^th be a weekend or holiday, based on the activity of the year just ending.  UTG's director compensation policy also provides that Directors who are employees of UTG or its affiliates do not receive any compensation for their services as Directors except for reimbursement for reasonable travel expenses for attending each meeting. In December of 2015, the Company issued 4,245shares of its common stock as compensation to the Directors. The shares were valued at $14.36per share, the market value at the date of issue. During 2015, the Company recorded $60,958in operating expense related to the stock issuance.  In December of 2014, the Company issued 4,755shares of its common stock as compensation to the Directors. The shares were valued at $14.50per share, the market value at the date of issue. During 2014, the Company recorded $68,948in operating expense related to the stock issuance.

Earnings Per Share - The following is a reconciliation of basic and diluted weighted average shares outstanding used in the computation of basic and diluted earnings per share:

	2015	2014
Basic weighted average shares outstanding	3,704,322	3,750,239
Weighted average dilutive options outstanding	0	0
Diluted weighted average shares outstanding	3,704,322	3,750,239

The computation of diluted earnings per share is the same as basic earnings per share for the years ending December 31, 2015 and 2014, as there were no outstanding securities, options or other offers that give the right to receive or acquire common shares of UTG.

Statutory Restrictions – Restrictions exist on the flow of funds to UTG from its insurance subsidiary.  Statutory regulations require life insurance subsidiaries to maintain certain minimum amounts of capital and surplus. UG is required to maintain minimum statutory surplus of $2,500,000. At December 31, 2015, substantially all of the consolidated shareholders' equity represents net assets of UTG's subsidiaries.

UG is domiciled in the state of Ohio. Ohio 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.  Extraordinary dividends (amounts in excess of ordinary dividend limitations) require prior approval of the insurance commissioner and are not restricted to a specific calculation.  UG paid ordinary dividends of  $4,000,000 and $4,800,000 to UTG in 2015 and  2014,respectively. No extraordinary dividends were paid during the two year period. UTG used the dividends received during 2014 and 2015 to  purchase outstanding shares of UTG stockand for general operations of the Company.

Statutory Restrictions – Restrictions exist on the flow of funds to UTG from its insurance subsidiary.  Statutory regulations require life insurance subsidiaries to maintain certain minimum amounts of capital and surplus. UG is required to maintain minimum statutory surplus of $2,500,000. At December 31, 2015, substantially all of the consolidated shareholders' equity represents net assets of UTG's subsidiaries.

UG is domiciled in the state of Ohio. Ohio 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.  Extraordinary dividends (amounts in excess of ordinary dividend limitations) require prior approval of the insurance commissioner and are not restricted to a specific calculation.  UG paid ordinary dividends of $4,000,000 and $4,800,000 to UTG in 2015 and 2014, respectively. No extraordinary dividends were paid during the two year period. UTG used the dividends received during 2014 and 2015 to purchase outstanding shares of UTG stock and for general operations of the Company.

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STATUTORY ACCOUNTING

12 Months Ended

Dec. 31, 2015

STATUTORY ACCOUNTING [Abstract]

SHAREHOLDERS DIVIDEND RESTRICTION AND MINIMUM STATUTORY CAPITAL

Note 10 - Statutory Accounting

The insurance subsidiary prepares its statutory-based financial statements in accordance with accounting practices prescribed or permitted by the Ohio Department of Insurance.  These principles differ significantly from accounting principles generally accepted in the United States of America.  "Prescribed" statutory accounting practices include state laws, regulations, and general administrative rules, as well as a variety of publications of the National Association of Insurance Commissioners (NAIC).  "Permitted" statutory accounting practices encompass all accounting practices that are not prescribed; such practices may differ from state to state, from company to company within a state, and may change in the future.

The following table reflects UG's statutory basis net income and capital and surplus (shareholders' equity) as of December 31:

	2015			2014
Net income (loss)		$	306,059		$	12,200,025
Capital and surplus			39,752,432			41,146,686

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RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2015

RELATED PARTY TRANSACTIONS [Abstract]

RELATED PARTY TRANSACTIONS

Note 11 – Related Party Transactions

On February 20, 2003, UG purchased $4,000,000 of a trust preferred security offering issued by First Southern Bancorp, Inc. ("FSBI").  The security has a mandatory redemption after 30 years with a call provision after 5 years.  The security pays a quarterly dividend at a fixed rate of 6.515 %. The Company received dividends of $264,219 during 2015 and 2014. On March 30, 2009, UG purchased $1,000,000 of FSBI common stock.  The sale and transfer of this security is restricted by the provisions of a stock restriction and buy-sell agreement.

On September 28, 2011 UTG entered a joint ownership agreement with Bandyco, LLC and First Southern National Bank, for an 8.08 % interest in an aircraft. Bandyco, LLC is affiliated with Ward F Correll, who is a Director of the Company. The Company paid a monthly operational fee of $25,000 through July of 2014 when the aircraft was sold.  During July of 2014, the Company acquired a different aircraft.  UTG paid $1,600,000 in the acquisition of the aircraft, increasing the Company's ownership interest to 30.10 %. The aircraft is used for business related travel by various officers and employees of the Company. For years 2015 and 2014, UTG paid $255,920 and $879,453 for costs associated with the aircraft, respectively.

Effective January 1, 2007, UTG entered into administrative services and cost sharing agreements with its subsidiary. Under this arrangement, the subsidiary pays its proportionate share of expenses, based on an allocation formula. During 2015 and 2014, UG paid $6,867,882 and $8,902,568, respectively, in expenses. The Ohio Department of Insurance has approved the cost sharing agreement and it is Management's opinion that where applicable, costs have been allocated fairly and such allocations are based upon accounting principles generally accepted in the United States of America.

The Company from time to time acquires mortgage loans through participation agreements with FSNB.  FSNB services the Company's mortgage loans including those covered by the participation agreements.  The Company pays a 0.25 % servicing fee on these loans and a one-time fee at loan origination of 0.50 % of the original loan cost to cover costs incurred by FSNB relating to the processing and establishment of the loan.  The Company paid $11,622 and $33,894 in servicing fees and $25,000 and $0 in origination fees to FSNB during 2015 and 2014, respectively.

The Company reimbursed expenses incurred by employees of FSNB relating to salaries, travel and other costs incurred on behalf of or relating to the Company. The Company paid $324,918 and $325,479 in 2015 and 2014, respectively to FSNB in reimbursement of such costs. In addition, the Company reimburses FSNB a portion of salaries and pension costs for Mr. Correll and Mr. Ditto. The reimbursement was approved by the UTG Board of Directors and totaled $349,351 and $332,725 in 2015 and 2014, respectively, which included salaries and other benefits.

As previously disclosed in the Notes Receivable section of Note 2 – Investments, several of the Company's notes have participation agreements in place with third parties.  Certain participation agreements are with FSF, a related party.  The participation agreements are sold without recourse and assigned to the participant based on their pro-rata share of the principal, interest and collateral as specified in the participation agreements.The undivided participations in the notes receivable range from 20% - 50%.  The total amount of loans participated to FSF were $3,170,000and $0 as of December 31, 2015 and 2014, respectively. One of the participated notes receivable was fully repaid during the first quarter of 2016 reducing the outstanding participating notes receivable balance with FSF to $670,000.

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OTHER CASH FLOW DISCLOSURES

12 Months Ended

Dec. 31, 2015

OTHER CASH FLOW DISCLOSURES [Abstract]

OTHER CASH FLOW DISCLOSURES

Note 12 – Other Cash Flow Disclosures

On a cash basis, the Company paid the following expenses for the periods ended December 31:

	2015			2014
Interest		$	70,141		$	635,664
Federal income tax			3,300,000			4,000

During the fourth quarter of 2014, UG's wholly-owned subsidiary, UTG Avalon, LLC, entered into a noncash transaction whereby the subsidiary obtained a promissory note in the amount of $4.4 million and utilized the note to repay a prior line of credit.

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CONCENTRATIONS

12 Months Ended

Dec. 31, 2015

CONCENTRATIONS [Abstract]

CONCENTRATIONS

Note 13 - Concentrations

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 T. 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.

Because UTG serves primarily individuals located in four states, the ability of our customers to pay their insurance premiums is impacted by the economic conditions in these areas.  As of December 31, 2015 and 2014, approximately 54% of the Company's total direct premium was collected from Illinois, Ohio, Texas and West Virginia. Thus, results of operations are heavily dependent upon the strength of these economies.

The Company reinsures that portion of insurance risk which is in excess of its retention limits. Retention limits range up to $125,000 per life.  Life insurance ceded represented 21% of total life insurance in force at December 31, 2015 and 2014.  Insurance ceded represented 31% and 29% of premium income for 2015 and 2014, respectively. The Company would be liable for the reinsured risks ceded to other companies to the extent that such reinsuring companies are unable to meet their obligations.

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SELECTED QUARTERLY FINANCIAL DATA

12 Months Ended

Dec. 31, 2015

SELECTED QUARTERLY FINANCIAL DATA [Abstract]

SELECTED QUARTERLY FINANCIAL DATA [Text Block]

Note 14 – Selected Quarterly Financial Data

As a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and Item 10(f)(1) of Regulation S-K, the Company has elected to comply with certain scaled disclosure reporting obligations, and therefore does not have to provide the information required by this item.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2015

Summary of Significant Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation – The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"), under guidance issued by the Financial Accounting Standards Board ("FASB").  The preparation of financial statements in accordance with GAAP requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Principles of Consolidation

Principles of Consolidation – The accompanying consolidated financial statements include the accounts of the Registrant and its wholly and majority-owned subsidiaries.  All significant intercompany accounts and transactions have been eliminated during consolidation.

Business Segments

Business Segments – The Company has only one business segment – life insurance.

Investments

Investments – The Company reports its investments as follows:

Fixed Maturity Investments – The Company classifies its fixed maturity investments, which include bonds, as available for sale. Investments classified as available for sale are carried at fair value with unrealized gains and losses, net of deferred taxes, reflected directly in accumulated other comprehensive income.  Premiums and discounts on debt securities purchased at other than par value are amortized and accreted, respectively, to interest income in the Consolidated Statements of Operations, using the constant yield method over the period to maturity.  Net realized gains and losses on sales of available for sale securities, and unrealized losses considered to be other-than-temporary, are recorded to net realized investment gains (losses) in the Consolidated Statements of Operations.

Equity Securities – Investments in equity securities, which include common and preferred stocks, are reported at fair value with unrealized gains and losses, net of deferred taxes, reflected directly in accumulated other comprehensive income (loss).

Trading Securities – Trading security investments are reported at fair value with gains and losses resulting from changes in fair value recognized in earnings. Trading securities include exchange traded equities and exchange traded options.

Mortgage Loans on Real Estate – Mortgage loans on real estate are reported at their unpaid principal balances, adjusted for amortization of premium or discount and valuation allowances. Valuation allowances are established for impaired loans when it is probable that contractual principal and interest will not be collected. Included in the mortgage loans balance is discounted mortgage loans on real estate. Discounted mortgage loans on real estate are loans that the Company purchased at a deep discount through an auction process led by the Federal Government or other intermediary.  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 adjusted for any principal receipts received.  Management works with the borrower to reach a settlement on the loan or they foreclose on the underlying collateral which is primarily commercial real estate.  For cash payments received during the work out process, the Company records these payments to interest income on a cash basis.  For loan settlements reached, the Company records the amount in excess of the carrying amount of the loan as a discount accretion to investment income at the closing date.  Management reviews the discount loan portfolio regularly for impairment.  If an impairment is identified (after consideration of the underlying collateral), the Company records an impairment to earnings in the period the information becomes known.

Investment Real Estate – Investment real estate held for sale is reported at the lower of cost or fair value less cost to sell. Expenses to maintain the property are expensed as incurred.

Notes Receivable – Notes receivable are reported at their unpaid principal balances, adjusted for valuation allowances. Valuation allowances are established for impaired loans when it is probable that contractual principal and interest will not be collected. Interest accruals are analyzed based on the likelihood of repayment. The Company does not utilize a specified number of days delinquent to cause an automatic non-accrual status.

Policy Loans – Policy loans are reported at their unpaid balances, including accumulated interest, but not in excess of the cash surrender value of the related policy.

Short-Term Investments – Short-term investments are reported at amortized cost, which approximates fair value.

Gains and Losses – Realized gains and losses include sales of investments and investment impairments.  If any, other-than-temporary impairments in fair value are recognized in net income on the specific identification basis.

Fair Value – Fair values for cash, short-term investments, short-term debt, receivables and payables approximate carrying value. Fair values for fixed maturities, equity securities and certain other assets are determined in accordance with specific accounting guidance.  Fair values are based on quoted market prices, where available.  Otherwise, fair values are based on quoted market prices of comparable instruments in active markets, quotes in inactive markets, or other observable criteria. Mortgage loans on real estate are estimated using discounted cash flow analyses. Discounted mortgage loans on real estate are reported at original purchase price, which Management believes approximates fair value.  For more specific information regarding the Company's measurements and procedures in valuing financial instruments, see Note 3 – Fair Value Measurements.

Impairment of Investments – The Company evaluates its investment portfolio for other-than-temporary impairments as described in Note 2 – Investments.  If a security is deemed to be other-than-temporarily impaired, the cost basis of the security is written down to fair value and is treated as a realized loss.

Current accounting guidance states that if an entity intends to sell or if it is more likely than not that it will be required to sell an impaired security prior to recovery of its cost basis, the security is to be considered other-than-temporarily impaired and the full amount of impairment must be charged to earnings.  Otherwise, losses on fixed maturities which are other-than-temporarily impaired are separated into two categories, the portion of the loss which is considered credit loss and the portion of the loss which is due to other factors.  The credit loss portion is charged to earnings while the loss due to other factors is charged to other comprehensive income.

Cash Equivalents and Cash

Cash Equivalents – The Company considers certificates of deposit and other short-term instruments with an original purchased maturity of three months or less to be cash equivalents.

Cash – Cash consists of balances on hand and on deposit in banks and financial institutions.

Reinsurance

Reinsurance - In the normal course of business, the Company seeks to limit its exposure to loss on any single insured and to recover a portion of benefits paid by ceding reinsurance to other insurance enterprises or reinsurers under excess coverage and coinsurance contracts.  The Company retains a maximum of  $125,000 of coverage per individual life.

Reinsurance receivables are recognized in a manner consistent with the liabilities relating to the underlying reinsured contracts. The cost of reinsurance related to long-duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies

Cost of Insurance Acquired

Cost of Insurance Acquired - When an insurance company is acquired, the Company assigns a portion of its cost to the right to receive future cash flows from insurance contracts existing at the date of the acquisition. The cost of policies purchased represents the actuarially determined present value of the projected future profits from the acquired policies. 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 amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised.

Property and Equipment

Property and Equipment - Company-occupied property, data processing equipment and furniture and office equipment are stated at cost less accumulated depreciation of  $3,323,718 and $3,868,331 at December 31, 2015 and 2014, respectively. Depreciation is computed on a straight-line basis for financial reporting purposes using estimated useful lives of  three to thirty years.  Depreciation expense was $139,218 and $309,279 for the years ended December 31, 2015 and 2014, respectively.

Future Policy Benefits and Expenses

Future Policy Benefits and Expenses - The liabilities for traditional life insurance and accident and health insurance policy benefits are computed using a net level method. These liabilities include assumptions as to investment yields, mortality, withdrawals, and other assumptions based on the life insurance subsidiary's experience adjusted to reflect anticipated trends and to include provisions for possible unfavorable deviations. The Company makes these assumptions at the time the contract is issued or, in the case of contracts acquired by purchase, at the purchase date.  Future policy benefits for individual life insurance and annuity policies are computed using interest rates ranging from 2% to 6% for life insurance and 2.5% to 7.50% for annuities. Benefit reserves for traditional life insurance policies include certain deferred profits on limited-payment policies that are being recognized in income over the policy term. Policy benefit claims are charged to expense in the period that the claims are incurred. The mortality rate assumptions for policies currently issued by the Company are based on 2001 select and ultimate tables.  Withdrawal rate assumptions are based upon Linton B or C, which are industry standard actuarial tables for forecasting assumed policy lapse rates.

Benefit reserves for universal life insurance and interest sensitive life insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges.  Policy benefits and claims that are charged to expense include benefit claims in excess of related policy account balances.  Interest crediting rates for universal life and interest sensitive products range from 4.0% to 5.5% as of December 31, 2015 and 2014.

Policy Claims and Benefits Payable

Policy Claims and Benefits Payable - Policy and contract claims include provisions for reported claims in process of settlement, valued in accordance with the terms of the policies and contracts, as well as provisions for claims incurred and unreported. The estimate of incurred and unreported claims is based on prior experience. The Company makes an estimate after careful evaluation of all information available to the Company.  There is no certainty the stated liability for policy claims and benefits payable, including the estimate for incurred but unreported claims, will be the Company's ultimate obligation.

Income Taxes

Income Taxes – Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement book values and tax bases of assets and liabilities.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  More information concerning income taxes is provided in Note 6 – Income Taxes.

Earnings Per Share

Earnings Per Share – The objective of both basic earnings per share ("EPS") and diluted EPS is to measure the performance of an entity over the reporting period.  The Company presents basic and diluted EPS on the face of the Consolidated Statements of Operations. Basic EPS is computed by dividing income available to common shareholders by the weighted average common shares outstanding for the period.  Diluted EPS is calculated by adding to shares outstanding the additional net effect of potentially dilutive securities or contracts, such as stock options, which could be exercised or converted into common shares.

Recognition of Revenues and Related Expenses

Recognition of Revenues and Related Expenses - Premiums for traditional life insurance products, which include those products with fixed and guaranteed premiums and benefits, consist principally of whole life insurance policies, and certain annuities with life contingencies are recognized as revenues when due. Limited payment life insurance policies defer gross premiums received in excess of net premiums, which is then recognized in income in a constant relationship with insurance in-force. Accident and health insurance premiums are recognized as revenue pro rata over the terms of the policies. Benefits and related expenses associated with the premiums earned are charged to expense proportionately over the lives of the policies through a provision for future policy benefit liabilities and through deferral and amortization of deferred policy acquisition costs. For universal life and investment products, generally there is no requirement for payment of premium other than to maintain account values at a level sufficient to pay mortality and expense charges. Consequently, premiums for universal life policies and investment products are not reported as revenue, but as deposits. Policy fee revenue for universal life policies and investment products consists of charges for the cost of insurance and policy administration fees assessed during the period. Expenses include interest credited to policy account balances and benefit claims incurred in excess of policy account balances.

Recently Issued Accounting Standards

Recently Issued Accounting Standards

Accounting Standards Update (ASU) 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities – ASU 2016-01 makes targeted improvements to existing U.S. GAAP for financial instruments, including requiring equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; requiring entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; requiring separate presentation of financial assets and financial liabilities by measurement category and form of financial asset and requiring entities to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk (also referred to as "own credit") when the organization has elected to measure the liability at fair value in accordance with the fair value option. The new guidance is effective for public companies for fiscal years beginning after December 15, 2017. Early adoption of the own credit provision is permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements.

Accounting Standards Update (ASU) 2015-17, Income Taxes: Balance Sheet Classification of Deferred Taxes – ASU 2015-17 simplifies the presentation of deferred income taxes to require that deferred tax assets and liabilities be classified as non-current in a classified balance sheet. Current U.S. GAAP requires an entity to separate deferred income tax assets and liabilities into current and non-current amounts in a classified balance sheet. The current requirement that deferred tax assets and liabilities of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments of this Update.  For public companies, the guidance is ASC 2015-17 is effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Earlier adoption is permitted. The adoption of this guidance is not expected to have a material impact on the Company's consolidated financial statements.

Accounting Standards Update (ASU) 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis – ASU 2015-02 makes changes to both the variable interest model and voting interest model and eliminates the indefinite deferral of FASB Statement No. 167, included in ASU 2010-10, for certain investment funds. All reporting entities that hold a variable interest in other legal entities will need to re-evaluate their consolidation conclusions as well as disclosure requirements. This ASU is effective for annual periods beginning after December 15, 2015, and early adoption is permitted, including any interim period. This is not expected to have a material impact on the financial statements of the Company.

Accounting Standards Update (ASU) 2015-01, Income Statement – Extraordinary and Unusual Items – ASU 2015-01 removes the concept of extraordinary items from U.S. GAAP.  Under the existing guidance, an entity is required to separately disclose extraordinary items, net of tax, in the income statement after income from continuing operations if an event or transaction is unusual and occurs infrequently.  This separate, net-of-tax presentation will no longer be allowed.  The existing requirement to separately disclose events or transactions that are unusual or occur infrequently on a pre-tax basis within continuing operations in the income statement has been retained.  The new guidance requires similar separate presentation of items that are both unusual and infrequent.  The new standard is effective for periods beginning after December 15, 2015.  Early adoption is permitted, but only as of the beginning of the fiscal year of adoption.  Upon adoption, the Company will present transactions that are both unusual and infrequent, if any, on a pre-tax basis within continuing operations in the Consolidated Statements of Operations.

Reclassifications – Certain reclassifications have been made to the 2014 consolidated financial statements to make them comparable to the current year consolidated financial statements.

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INVESTMENTS (Tables)

12 Months Ended

Dec. 31, 2015

INVESTMENTS [Abstract]

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

The following tables provide a summary of fixed maturities available for sale and equity securities by original or amortized cost and estimated fair value:

December 31, 2015	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	$	20,336,681	$	1,441,890	$	(32,083	)	$	21,746,488
U.S. special revenue and assessments		1,137,546		7,843		(2,550	)		1,142,839
All other corporate bonds		167,173,444		3,762,156		(8,705,830	)		162,229,770
		188,647,671		5,211,889		(8,740,463	)		185,119,097
Equity securities		43,954,737		2,119,205		(388,602	)		45,685,340
Total	$	232,602,408	$	7,331,094	$	(9,129,065	)	$	230,804,437

December 31, 2014	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	$	23,036,161	$	1,970,791	$	(50,184	)	$	24,956,768
States, municipalities and political subdivisions		95,000		2,385		0			97,385
U.S. special revenue and assessments		1,137,702		13,739		(202,930	)		948,511
Collateralized mortgage obligations		1,005,081		92,091		(6	)		1,097,166
Public utilities		399,927		55,913		0			455,840
All other corporate bonds		162,960,493		8,624,486		(1,659,193	)		169,925,786
		188,634,364		10,759,405		(1,912,313	)		197,481,456
Equity securities		39,275,638		2,260,855		(540,491	)		40,996,002
Total	$	227,910,002	$	13,020,260	$	(2,452,804	)	$	238,477,458

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

The following table provides a summary of fixed maturities by contractual maturity as of  December 31, 2015. Actual maturities could differ from contractual maturities due to call or prepayment provisions:

Fixed Maturities Available for Sale December 31, 2015	Amortized Cost		Estimated Fair Value
Due in one year or less	$	3,961,534	$	4,000,512
Due after one year through five years		23,444,519		24,343,844
Due after five years through ten years		64,352,687		62,094,221
Due after ten years		96,888,931		94,680,520
Total	$	188,647,671	$	185,119,097

Fair value of investments with sustained gross unrealized losses

The fair value of investments with sustained gross unrealized losses at December 31, 2015 and 2014 are as follows:

December 31, 2015	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	$	4,966,210	(32,083)	$	0	0	$	4,966,210	(32,083)
U.S. special revenue and assessments		984,770	(2,550)		0	0		984,770	(2,550)
All other corporate bonds		85,734,097	(5,255,276)		19,400,640	(3,450,554)		105,134,737	(8,705,830)
Total fixed maturities	$	91,685,077	(5,289,909)	$	19,400,640	(3,450,554)	$	111,085,717	(8,740,463)
Equity securities	$	4,741,132	(388,602)	$	0	0	$	4,741,132	(388,602)

December 31, 2014	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		0	0		4,947,265	(50,184)		4,947,265	(50,184)
U.S. special revenue and assessments		0	0		784,390	(202,930)		784,390	(202,930)
Collateralized mortgage obligations		0	0		1,012	(6)		1,012	(6)
All other corporate bonds	$	28,954,477	(416,560)	$	3,535,206	(1,242,633)	$	32,489,683	(1,659,193)
Total fixed maturities	$	28,954,477	(416,560)	$	9,267,873	(1,495,753)	$	38,222,350	(1,912,313)
Equity securities	$	6,067,132	(540,491)	$	0	0	$	6,067,132	(540,491)

Trading revenue charged to investment

The following table reflects trading securities revenue charged to net investment income for the periods ended December 31:

	2015				2014
Net unrealized gains (losses)		$	945,128			$	(722,573	)
Net realized gains (losses)			(515,967	)			245,995
Net unrealized and realized gains (losses)		$	429,161			$	(476,578	)

Loan payment performance since inception

During 2015 and 2014, the maximum and minimum lending rates for mortgage loans were:

	2015		2014
	Maximum rate	Minimum rate	Maximum rate	Minimum rate
Commercial Loans	8.00 %	4.00 %	10.00 %	3.91 %
Residential Loans	8.00 %	3.00 %	8.00 %	7.00 %

Discounted mortgage holdings

The following table summarizes the number of loans held in the discounted mortgage loan portfolio and the carrying value of the loans as of December 31, 2015:

Payment Frequency	Number of Loans		Carrying Value
No payments received		8	$	0
One-time payment received		1		0
Irregular payments received		2		20,834
Periodic payments received		7		5,347,215
Total		18	$	5,368,049

The following table summarizes the mortgage loan holdings of the Company for the periods ended December 31:

Schedule of net investment income

The following table reflects the Company's net investment income for the periods ended December 31:

	2015			2014
Fixed maturities	$	8,559,938		$	8,225,640
Equity securities		1,708,786			3,255,611
Trading securities		(429,161	)		(476,578	)
Mortgage loans		5,700,492			4,592,853
Real estate		1,474,726			8,355,153
Notes receivable		787,658			340,000
Policy loans		720,544			760,715
Cash and cash equivalents		681			505
Short-term		699,357			70,578
Total consolidated investment income		19,223,021			25,124,477
Investment expenses		(3,663,086	)		(8,774,758	)
Consolidated net investment income	$	15,559,935		$	16,349,719

Net realized investment gains losses

The following table reflects the Company's net realized investments gains and losses for the periods ended December 31:

2015	Gross Realized Gains		Gross Realized (Losses)		Net Realized Gains (Losses)
Fixed maturities	$	1,289,455	$	(41,215)	$	1,248,240
Real estate		5,968,558		0		5,968,558
Common stock		48,165		(238,794)		(190,629)
Preferred stock		971,662		(637)		971,025
Real estate – OTTI		0		(54,901)		(54,901)
Common stock – OTTI		0		(3,515,700)		(3,515,700)
Total realized gains (losses)	$	8,277,840	$	(3,851,247)	$	4,426,593

2014	Gross Realized Gains		Gross Realized (Losses)		Net Realized Gains (Losses)
Fixed maturities	$	2,414,160	$	(1,135,417)	$	1,278,743
Real estate		14,757,451		(1,460,332)		13,297,119
Common stock		673,821		(14,908)		658,913
Preferred stock		1,986,303		0		1,986,303
Real estate – OTTI		0		(35,946)		(35,946)
Common stock – OTTI		0		(126,959)		(126,959)
Total realized gains (losses)	$	19,831,735	$	(2,773,562)	$	17,058,173

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 Consolidated Statements of Operations for the periods ended December 31:

	2015		2014
Other than temporary impairments:
Common stock	$	3,515,700	$	126,959
Real estate		54,901		35,946
Total other than temporary impairments	$	3,570,601	$	162,905

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FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Dec. 31, 2015

FAIR VALUE MEASUREMENTS [Abstract]

Financial assets and liabilities measured on recurring basis

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	10,459,758	$	173,632,645	$	1,026,694	$	185,119,097
Equity Securities, available for sale		13,312,331		5,567,061		26,805,948		45,685,340
Total		23,772,089		179,199,706		27,832,642		230,804,437
Liabilities
Trading Securities	$	28,609	$	0	$	0	$	28,609

The following table presents the Company's assets and liabilities measured at fair value in the consolidated balance sheet on a recurring basis as of December 31, 2014.

	Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	13,374,878	$	183,236,853	$	869,725	$	197,481,456
Equity Securities, available for sale		4,756,292		7,361,076		28,878,634		40,996,002
Trading Securities		3,826,250		0		0		3,826,250
Total	$	21,957,420	$	190,597,929	$	29,748,359	$	242,303,708
Liabilities
Trading Securities	$	23,853	$	0	$	0	$	23,853

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

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, 2014	$	869,725		$	28,878,634		$	29,748,359
Transfers in to Level 3		0			0			0
Total unrealized gains or (losses):
Included in realized gains (losses)		67,905			-			67,905
Included in other comprehensive income		210,819			270,670			481,489
Purchases		0			1,920,607			1,920,607
Sales		(121,755	)		(4,263,963	)		(4,385,718	)
Balance at December 31, 2015	$	1,026,694		$	26,805,948		$	27,832,642

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REINSURANCE (Tables)

12 Months Ended

Dec. 31, 2015

REINSURANCE [Abstract]

Effect of long duration reinsurance contracts on premiums earned

The Company does not have any short-duration reinsurance contracts.  The effect of the Company's long-duration reinsurance contracts on premiums earned in 2015 and 2014 were as follows:

	2015 Premiums Earned			2014 Premiums Earned
Direct	$	11,140,000		$	11,642,000
Assumed		25,000			26,000
Ceded		(3,091,000	)		(3,127,000	)
Net Premiums	$	8,074,000		$	8,541,000

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COST OF INSURANCE ACQUIRED (Tables)

12 Months Ended

Dec. 31, 2015

Cost of Insurance Acquired [Abstract]

Cost of insurance acquired

Note 5 – Cost of Insurance Acquired

When an insurance company is acquired, the Company assigns a portion of its cost to the right to receive future cash flows from insurance contracts existing at the date of the acquisition.  The cost of policies purchased represents the actuarially determined present value of the projected future profits from the acquired policies.  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 utilized may vary due to differences in the blocks of business.  The interest rate utilized in the amortization calculation of the remaining cost of insurance acquired is 12%. The amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised.

	2015			2014
Cost of insurance acquired, beginning of year	$	9,047,984		$	10,636,412
Sale of block of business		0			(602,778	)
Interest accretion		1,180,703			1,298,980
Amortization		(2,088,308	)		(2,284,630	)
Net amortization		(907,605	)		(985,650	)
Cost of insurance acquired, end of year	$	8,140,379		$	9,047,984

Estimated net amortization expense of cost of insurance acquired for the next five years is as follows:

	Interest Accretion	Amortization	Net Amortization
2016	1,072,000	1,945,000	873,000
2017	967,000	1,806,000	839,000
2018	866,000	1,672,000	806,000
2019	770,000	1,546,000	776,000
2020	677,000	1,421,000	744,000

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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2015

INCOME TAXES [Abstract]

Income tax expense (benefits)

Income tax expense (benefit) consists of the following components:

	2015				2014
Current tax		$	747,714			$	3,233,286
Deferred tax			(1,680,429	)			(2,150,359	)
Income tax expense (benefit)		$	(932,715	)		$	1,082,927

Income tax expense (benefit) reconciliation

The expense for income differed from the amounts computed by applying the applicable United States statutory rate of 35% before income taxes as a result of the following differences:

	2015			2014
Tax computed at statutory rate	$	95,663		$	3,894,334
Changes in taxes due to:
Non-controlling interest		(101,297	)		(1,073,704	)
Current period loss for which no tax benefit was recognized		17,693			17,401
Small company deduction		(552,694	)		(134,653	)
Dividend received deduction		(100,349	)		(1,414,353	)
Other		(291,731	)		(206,098	)
Income tax expense (benefit)	$	(932,715	)	$	1,082,927

Major components that comprise the deferred tax liability

The following table summarizes the major components that comprise the deferred tax liability as reflected in the balance sheets:

	2015			2014
Investments	$	(2,735,072	)	$	2,728,928
Cost of insurance acquired		2,849,133			3,166,794
Management/consulting fees		(55,125	)		(57,454	)
Future policy benefits		1,546,770			1,778,105
Deferred gain on sale of subsidiary		2,312,483			2,312,483
Other liabilities		27,406			(127,461	)
Federal tax DAC		(540,128	)		(387,601	)
Deferred tax liability	$	3,405,467		$	9,413,794

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CREDIT ARRANGEMENTS (Tables)

12 Months Ended

Dec. 31, 2015

CREDIT ARRANGEMENTS [Abstract]

Schedule of promissory note

At December 31, 2015 and 2014, the Company had the following outstanding debt:

			Outstanding Principal Balance
Instrument	Issue Date	Maturity Date	December 31, 2015			December 31, 2014
Promissory Note:
UTG Avalon	12/29/2014	4/1/2018		$	0		$	4,400,000

Schedule of lines of credit

Instrument	Issue Date	Maturity Date	Revolving Credit Limit			December 31, 2014			Borrowings		Repayments		December 31, 2015
Lines of Credit:
UTG	11/20/2013	11/20/2015		$	8,000,000		$	0		0		0		$	0
UG	6/2/2015	5/19/2016			10,000,000			0		0		0			0

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COMMITMENTS AND CONTINGENCIES (Tables)

12 Months Ended

Dec. 31, 2015

COMMITMENTS AND CONTINGENCIES [Abstract]

Funding commitment and unfunded commitment

The following table represents the total funding commitments and the unfunded commitment as of December 31, 2015 related to certain investments:

	Total Funding Commitment		Unfunded Commitment
RLF III, LLC	$	4,000,000	$	398,120
Llano Music, LLC		4,000,000		1,179,000
Sovereign's Capital, LP Fund I		500,000		125,000
UGLIC, LLC		1,600,000		120,000
Sovereign's Capital, LP Fund II		1,000,000		810,000

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SHAREHOLDERS' EQUITY (Tables)

12 Months Ended

Dec. 31, 2015

SHAREHOLDERS' EQUITY [Abstract]

Reconciliation of the numerators and denominators of the basic and diluted EPS

Earnings Per Share - The following is a reconciliation of basic and diluted weighted average shares outstanding used in the computation of basic and diluted earnings per share:

	2015	2014
Basic weighted average shares outstanding	3,704,322	3,750,239
Weighted average dilutive options outstanding	0	0
Diluted weighted average shares outstanding	3,704,322	3,750,239

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STATUTORY ACCOUNTING (Tables)

12 Months Ended

Dec. 31, 2015

STATUTORY ACCOUNTING [Abstract]

Statutory Basis Net Income and Capital Surplus

The following table reflects UG's statutory basis net income and capital and surplus (shareholders' equity) as of December 31:

	2015			2014
Net income (loss)		$	306,059		$	12,200,025
Capital and surplus			39,752,432			41,146,686

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OTHER CASH FLOW DISCLOSURES (Tables)

12 Months Ended

Dec. 31, 2015

OTHER CASH FLOW DISCLOSURES [Abstract]

Expenses paid on a cash basis

On a cash basis, the Company paid the following expenses for the periods ended December 31:

	2015			2014
Interest		$	70,141		$	635,664
Federal income tax			3,300,000			4,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Related Party Transaction [Line Items]
Maximum amount retained per individual life	$ 125,000	$ 125,000
Property, Plant and Equipment [Line Items]
Depreciation, Total	139,218	309,279
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment, Excluding Capital Leased Assets	$ 3,323,718	$ 3,868,331
Interest rate assumptions [Abstract]
Individual life insurance future policy benefit, low end	2.00%
Individual life insurance future policy benefit, high end	6.00%
Annuities future policy benefit, low end	2.50%
Annuities future policy benefit, how end	7.50%
Interest crediting rates for universal life and interest sensitive products, Low End	4.00%
Interest crediting rates for universal life and interest sensitive products, High End	5.50%
Jesse T. Correll, Chief Executive Officer and Chairman of the Board [Member]
Related Party Transaction [Line Items]
Ownership or control of outstanding common stock directly or indirectly (in hundredths)	57.61%
Maximum [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Estimated Useful Lives	P30Y
Minimum [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Estimated Useful Lives	P3Y
First Southern National Bank [Member]
Subsidiary or Equity Method Investee [Line Items]
Ownership in subsidiary bank (in hundredths)	100.00%

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INVESTMENTS (Details)	3 Months Ended		12 Months Ended
	Dec. 31, 2015 USD ($) Security Loans	Dec. 31, 2014 USD ($) Security	Dec. 31, 2015 USD ($) Security Loans	Dec. 31, 2014 USD ($) Security
Fixed maturities [Abstract]
Original or Amortized Cost	$ 232,602,408	$ 227,910,002	$ 232,602,408	$ 227,910,002
Gross Unrealized Gains	7,331,094	13,020,260	7,331,094	13,020,260
Gross Unrealized Losses	(9,129,065)	(2,452,804)	(9,129,065)	(2,452,804)
Estimated Market Value	230,804,437	238,477,458	230,804,437	238,477,458
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Total Unrealized losses	(9,129,065)	(2,452,804)	(9,129,065)	(2,452,804)
Amortized cost of debt securities, by contractual maturity [Abstract]
Due in one year or less	3,961,534		3,961,534
Due after one year through five years	23,444,519		23,444,519
Due after five years through ten years	64,352,687		64,352,687
Due after ten years	96,888,931		96,888,931
Collateralized mortgage obligation	0		0
Total	188,647,671	188,634,364	188,647,671	188,634,364
Estimated market value of debt securities, by contractual maturity [Abstract]
Due in one year or less	4,000,512		4,000,512
Due after one year through five years	24,343,844		24,343,844
Due after five years through ten years	62,094,221		62,094,221
Due after ten years	94,680,520		94,680,520
Collateralized mortgage obligations	0		0
Available-for-sale Securities, Debt Securities	185,119,097	197,481,456	185,119,097	197,481,456
Amortized cost of investment in fixed maturities rated below investment grade	13,352,934	9,142,063	13,352,934	9,142,063
Trading Securities [Abstract]
Fair value, derivative included in trading security liabilities	0	(23,853)	0	(23,853)
Fair value, derivatives included in trading security assets	(28,609)	6,250	(28,609)	6,250
Increase (Decrease) in Trading Securities [Abstract]
Trading securities, realized gain (loss)			945,128	(722,573)
Trading securities, net unrealized gain (loss)			(515,967)	245,995
Net Realized and Unrealized Gain (Loss) on Trading Securities			429,161	(476,578)
trading transfer to available for sale securities	3,224,000	0	3,224,000	0
Mortgages [Abstract]
Mortgage Loans including Discounted Mortgage Loans	$ 13,774,698	$ 2,348,890	$ 13,774,698	$ 2,348,890
Servicing Fee on Loan Percent			0.25%
Loan Origination Percent			0.50%	0.50%
Commercial loans maximum rate	8.00%	10.00%	8.00%	10.00%
Commercial loans minimum rate	4.00%	3.91%	4.00%	3.91%
Residential loans maximum rate	8.00%	8.00%	8.00%	8.00%
Residential loans minimum rate	3.00%	7.00%	3.00%	7.00%
Loan limit threshold for appraised property value			80.00%
Average purchase price to outstanding loan (in hundredths)			39.00%
Mortgage loans reserve	$ 0	$ 0	$ 0	$ 0
Discounted mortgage loan portfolio payment performance [Abstract]
Number of discounted loans with no payments | Loans	8		8
Number of discounted loans one time payment received | Loans	1		1
Number of discounted loans irregular payments received | Loans	2		2
Number of discounted loans periodic payments received | Loans	7		7
Number of discounted loans | Loans	18		18
Discounted loans with no payments	$ 0		$ 0
Discounted loans with one time payment received	0		0
Discounted loans with irregular payments received	20,834		20,834
Discounted loans with periodic payments received	5,347,215		5,347,215
Discounted loans	5,368,049		5,368,049
Discounted mortgage loan holdings [Abstract]
In good standing	14,701,228	14,443,455	14,701,228	14,443,455
Overdue interest over 90 days	20,834	3,130,290	20,834	3,130,290
Restructured			126,118	1,104,972
In process of foreclosure	2,921,750	4,483,265	2,921,750	4,483,265
Total discounted mortgage loans	17,769,930	23,161,982	17,769,930	23,161,982
Total foreclosed discounted mortgage loans			0	56,576
NET INVESTMENT INCOME [Abstract]
Investment Income			(3,663,086)	(8,774,758)
Investment Income, Investment Expense			19,223,021	25,124,477
Consolidated Net Investment Income	15,559,935	16,349,719	15,559,935	16,349,719
Gain (Loss) on Investments [Line Items]
Gross realized gains			8,277,840
Gross Realized (Losses)			(3,851,247)
Total realized investment gains (losses), net			4,426,593
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward]
Other than Temporary Impairment Losses, Investments, Total			3,570,601	162,905
Fair value of investments on deposit with state insurance departments	8,932,241	10,635,716	8,932,241	10,635,716
Fixed Maturity Available for Sale [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			8,559,938	8,225,640
Equity Securities [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			1,708,786	3,255,611
Trading Securities [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			(429,161)	(476,578)
Mortgage Loans [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			5,700,492	4,592,853
Discounted Mortgage Loans [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			0	0
Real Estate [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			1,474,726	8,355,153
Policy Loans [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			720,544	760,715
Short-term Investments [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			699,357	70,578
Cash and Cash Equivalents [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			681	505
Notes Receivable [Member]
NET INVESTMENT INCOME [Abstract]
Investment Income			787,658	340,000
U.S. Government and Government Agencies and Authorities [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	20,336,681	23,036,161	20,336,681	23,036,161
Gross Unrealized Gains	1,441,890	1,970,791	1,441,890	1,970,791
Gross Unrealized Losses	(32,083)	(50,184)	(32,083)	(50,184)
Estimated Market Value	21,746,488	24,956,768	21,746,488	24,956,768
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	4,966,210	0	4,966,210	0
Less than 12 months, Unrealized losses	(32,083)	0	(32,083)	0
Twelve months or longer, Fair value	0	4,947,265	0	4,947,265
Twelve months or longer, Unrealized losses	0	(50,184)	0	(50,184)
Total Fair value	4,966,210	4,947,265	4,966,210	4,947,265
Total Unrealized losses	(32,083)	(50,184)	(32,083)	(50,184)
States, Municipalities and Political Subdivisions [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	0	95,000	0	95,000
Gross Unrealized Gains	0	2,385	0	2,385
Gross Unrealized Losses	0	0	0	0
Estimated Market Value	0	97,385	0	97,385
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Total Unrealized losses	0	0	0	0
Collateralized Mortgage Obligations [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	0	1,005,081	0	1,005,081
Gross Unrealized Gains	0	92,091	0	92,091
Gross Unrealized Losses	0	(6)	0	(6)
Estimated Market Value	0	1,097,166	0	1,097,166
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	0	0	0	0
Less than 12 months, Unrealized losses	0	0	0	0
Twelve months or longer, Fair value	0	1,012	0	1,012
Twelve months or longer, Unrealized losses	0	(6)	0	(6)
Total Fair value	0	1,012	0	1,012
Total Unrealized losses	0	(6)	0	(6)
Public Utilities [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	0	399,927	0	399,927
Gross Unrealized Gains	0	55,913	0	55,913
Gross Unrealized Losses	0	0	0	0
Estimated Market Value	0	455,840	0	455,840
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Total Unrealized losses	0	0	0	0
Debt Securities [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	188,647,671	188,634,364	188,647,671	188,634,364
Gross Unrealized Gains	5,211,889	10,759,405	5,211,889	10,759,405
Gross Unrealized Losses	(8,740,463)	(1,912,313)	(8,740,463)	(1,912,313)
Estimated Market Value	185,119,097	197,481,456	185,119,097	197,481,456
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	91,685,077	28,954,477	91,685,077	28,954,477
Less than 12 months, Unrealized losses	(5,289,909)	(416,560)	(5,289,909)	(416,560)
Twelve months or longer, Fair value	19,400,640	9,267,873	19,400,640	9,267,873
Twelve months or longer, Unrealized losses	(3,450,554)	(1,495,753)	(3,450,554)	(1,495,753)
Total Fair value	111,085,717	38,222,350	111,085,717	38,222,350
Total Unrealized losses	$ (8,740,463)	$ (1,912,313)	$ (8,740,463)	$ (1,912,313)
Less than 12 months Number of Securities | Security	40	18	40	18
Twelve months or longer Number of Securities | Security	9	7	9	7
Total Number of Securities | Security	49	25	49	25
Equity Securities [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	$ 43,954,737	$ 39,275,638	$ 43,954,737	$ 39,275,638
Gross Unrealized Gains	2,119,205	2,260,855	2,119,205	2,260,855
Gross Unrealized Losses	(388,602)	(540,491)	(388,602)	(540,491)
Estimated Market Value	45,685,340	40,996,002	45,685,340	40,996,002
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	4,741,132	6,067,132	4,741,132	6,067,132
Less than 12 months, Unrealized losses	(388,602)	(540,491)	(388,602)	(540,491)
Twelve months or longer, Fair value	0	0	0	0
Twelve months or longer, Unrealized losses	0	0	0	0
Total Fair value	4,741,132	6,067,132	4,741,132	6,067,132
Total Unrealized losses	$ (388,602)	$ (540,491)	$ (388,602)	$ (540,491)
Less than 12 months Number of Securities | Security	9	25	9	25
Twelve months or longer Number of Securities | Security	0	0	0	0
Total Number of Securities | Security	9	25	9	25
All Other Corporate Bonds [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	$ 167,173,444	$ 162,960,493	$ 167,173,444	$ 162,960,493
Gross Unrealized Gains	3,762,156	8,624,486	3,762,156	8,624,486
Gross Unrealized Losses	(8,705,830)	(1,659,193)	(8,705,830)	(1,659,193)
Estimated Market Value	162,229,770	169,925,786	162,229,770	169,925,786
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	85,734,097	28,954,477	85,734,097	28,954,477
Less than 12 months, Unrealized losses	(5,255,276)	(416,560)	(5,255,276)	(416,560)
Twelve months or longer, Fair value	19,400,640	3,535,206	19,400,640	3,535,206
Twelve months or longer, Unrealized losses	(3,450,554)	(1,242,633)	(3,450,554)	(1,242,633)
Total Fair value	105,134,737	32,489,683	105,134,737	32,489,683
Total Unrealized losses	(8,705,830)	(1,659,193)	(8,705,830)	(1,659,193)
US Special Revenue and Assessments [Member]
Fixed maturities [Abstract]
Original or Amortized Cost	1,137,546	1,137,702	1,137,546	1,137,702
Gross Unrealized Gains	7,843	13,739	7,843	13,739
Gross Unrealized Losses	(2,550)	(202,930)	(2,550)	(202,930)
Estimated Market Value	1,142,839	948,511	1,142,839	948,511
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, Fair value	984,770	0	984,770	0
Less than 12 months, Unrealized losses	(2,550)	0	(2,550)	0
Twelve months or longer, Fair value	0	784,390	0	784,390
Twelve months or longer, Unrealized losses	0	(202,930)	0	(202,930)
Total Fair value	984,770	784,390	984,770	784,390
Total Unrealized losses	$ (2,550)	$ (202,930)	(2,550)	(202,930)
Fixed Maturity Available for Sale [Member]
Gain (Loss) on Investments [Line Items]
Gross realized gains			1,289,455	2,414,160
Gross Realized (Losses)			(41,215)	(1,135,417)
Total realized investment gains (losses), net			1,248,240	1,278,743
Fixed Maturities Available for Sale - OTTI [Member]
Gain (Loss) on Investments [Line Items]
Gross realized gains			0	0
Gross Realized (Losses)			(54,901)	(126,959)
Total realized investment gains (losses), net			(54,901)	(126,959)
Equity Securities [Member]
Gain (Loss) on Investments [Line Items]
Gross realized gains			48,165	673,821
Gross Realized (Losses)			(238,794)	(14,908)
Total realized investment gains (losses), net			(190,629)	658,913
Preferred stock [Member]
Gain (Loss) on Investments [Line Items]
Gross realized gains			971,662	1,986,303
Gross Realized (Losses)			(637)	0
Total realized investment gains (losses), net			971,025	1,986,303
Equity Securities - OTTI [Member]
Gain (Loss) on Investments [Line Items]
Gross realized gains			0	19,831,735
Gross Realized (Losses)			(3,515,700)	(2,773,562)
Total realized investment gains (losses), net			(3,515,700)	17,058,173
Real Estate [Member]
Gain (Loss) on Investments [Line Items]
Gross realized gains			5,968,558	14,757,451
Gross Realized (Losses)			0	(1,460,332)
Total realized investment gains (losses), net			5,968,558	13,297,119
Mortgage loans [Member]
Gain (Loss) on Investments [Line Items]
Gross realized gains				0
Gross Realized (Losses)				(35,946)
Total realized investment gains (losses), net				(35,946)
Common Stock [Member]
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward]
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net, Available-for-sale Securities			3,515,700	126,959
Real Estate [Member]
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward]
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net, Available-for-sale Securities			$ 54,901	$ 35,946

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FAIR VALUE MEASUREMENTS, Financial Assets and Liabilities Measured on Recurring Basis (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Assets [Abstract]
Fixed Maturities, available for sale	$ 185,119,097	$ 197,481,456
Trading Securities	0	3,826,250
Liabilities [Abstract]
Trading Securities	0	23,853
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance	29,748,359
Transfers in to Level 3	0
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Unobservable Input, Realized Gain (Loss), Total	67,905
Total Unrealized Gains (Losses) Included in Other Comprehensive Income	481,489
Purchases	1,920,607
Sales	(4,385,718)
Ending Balance	27,832,642
Level 3 [Abstract]
In	0
Level 1 [Member]
Assets [Abstract]
Fixed Maturities, available for sale		13,374,878
Liabilities [Abstract]
Trading Securities	28,609	23,853
Level 2 [Member]
Assets [Abstract]
Fixed Maturities, available for sale		183,236,853
Liabilities [Abstract]
Trading Securities	0	0
Level 3 [Member]
Assets [Abstract]
Fixed Maturities, available for sale		869,725
Liabilities [Abstract]
Trading Securities	0	0
Total trading securities liabilities [Member]
Assets [Abstract]
Fixed Maturities, available for sale		197,481,456
Liabilities [Abstract]
Trading Securities	28,609	23,853
Fixed Maturities [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance	869,725
Transfers in to Level 3	0
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Unobservable Input, Realized Gain (Loss), Total	67,905
Total Unrealized Gains (Losses) Included in Other Comprehensive Income	210,819
Purchases	0
Sales	(121,755)
Ending Balance	1,026,694
Level 3 [Abstract]
In	0
Equity Securities [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance	28,878,634
Transfers in to Level 3	0
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Unobservable Input, Realized Gain (Loss), Total	0
Total Unrealized Gains (Losses) Included in Other Comprehensive Income	270,670
Purchases	1,920,607
Sales	(4,263,963)
Ending Balance	26,805,948
Level 3 [Abstract]
In	0
Measured on a recurring basis [Member]
Assets [Abstract]
Fixed Maturities, available for sale	185,119,097
Equity Securities, available for sale	45,685,340	40,996,002
Trading Securities		3,826,250
Total Financial Assets	230,804,437	242,303,708
Measured on a recurring basis [Member] | Level 1 [Member]
Assets [Abstract]
Fixed Maturities, available for sale	10,459,758
Equity Securities, available for sale	13,312,331	4,756,292
Trading Securities		3,826,250
Total Financial Assets	23,772,089	21,957,420
Measured on a recurring basis [Member] | Level 2 [Member]
Assets [Abstract]
Fixed Maturities, available for sale	173,632,645
Equity Securities, available for sale	5,567,061	7,361,076
Trading Securities		0
Total Financial Assets	179,199,706	190,597,929
Measured on a recurring basis [Member] | Level 3 [Member]
Assets [Abstract]
Fixed Maturities, available for sale	1,026,694
Equity Securities, available for sale	26,805,948	28,878,634
Trading Securities		0
Total Financial Assets	$ 27,832,642	$ 29,748,359

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FAIR VALUE MEASUREMENTS, Estimated Fair Value of Financial Instruments Required to be Valued by ASC 820 (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Carrying Amount [Member]
Assets [Abstract]
Mortgage loans on real estate	$ 17,769,930	$ 23,161,982
Discounted mortgage loans	0	0
Investment real estate	47,650,102	51,007,101
Policy Loans	10,597,907	5,612,560
Cash and cash equivalents	10,684,244	11,104,485
Financing Receivable, Gross	0	4,382,181
Other Assets, Fair Value Disclosure	11,822,615	13,977,443
Estimated Fair Value [Member]
Assets [Abstract]
Mortgage loans on real estate	17,775,178	23,337,728
Discounted mortgage loans	0	0
Investment real estate	47,650,102	51,007,101
Policy Loans	10,597,907	5,612,560
Cash and cash equivalents	10,684,244	11,104,485
Financing Receivable, Gross	0	4,382,181
Other Assets, Fair Value Disclosure	11,822,615	13,977,443
Fixed Maturities, available for sale	185,119,097	197,481,456
Trading Securities	0	3,826,250
Discounted mortgage loans	0	0
Investment real estate	47,650,102	51,007,101
Cash and cash equivalents	11,822,615	13,977,443	$ 19,838,618
Financing Receivable, Gross	10,597,907	5,612,560
Liabilities [Abstract]
Notes payable	0	4,400,000
Trading securities	$ 0	$ 23,853
Policy loan interest rate, minimum (in hundredths)	4.00%
Policy loan interest rate, maximum (in hundredths)	8.00%

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REINSURANCE (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Reinsurance [Line Items]
Retention amount limit	$ 125,000
Gross insurance in force	1,300,000,000	$ 1,400,000,000
Gross insurance ceded to reinsurers	272,000,000	$ 287,000,000
Retention limit amount of reinsurers	100,000
Cession on retention limit	$ 25,000
Percentage of reinsurers in force on accidental death benefits (in hundredths)	100.00%
Percentage of future results sold (in hundredths)	100.00%
Percentage in terms of reinsurance reserve credit (in hundredths)	63.00%	63.00%
Percentage of reserves and liabilities (in hundredths)	25.00%
Quota share of new issues percentage (in hundredths)		15.00%
Effect of long duration reinsurance contracts on premiums earned [Abstract]
Direct	$ 11,140,000	$ 11,642,000
Assumed	25,000	26,000
Ceded	(3,091,000)	(3,127,000)
Net Premiums	8,074,000	8,541,000
Remaining outstanding balance		300,000
Cash to purchaser	3,000,000
Approximate future policyholder benefits	3,600,000
Approximate cost of insurance acquired	600,000
Independent Order of Vikings (IOV) [Member]
Reinsurance [Line Items]
Remaining balance from gross insurance in force	1,451,000	1,503,000
Gross insurance in force, Reserve	350,000	346,000
Canada Life Assurance Company [Member]
Reinsurance [Line Items]
Gross insurance in force, Reserve	$ 0	0
Quota share of new issues percentage (in hundredths)	0.00%
Effect of long duration reinsurance contracts on premiums earned [Abstract]
Remaining outstanding balance	$ 0	$ 6,815,000

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COST OF INSURANCE ACQUIRED (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Cost of insurance acquired [Roll Forward]
Interest rate used in amortization calculation	12.00%
Cost of insurance acquired, beginning of year	$ 9,047,984	$ 10,636,412
California cost of insurance acquired	0	(602,778)
Interest accretion	1,180,703	1,298,980
Amortization	(2,088,308)	(2,284,630)
Net amortization	(907,605)	(985,650)
Cost of insurance acquired, end of year	8,140,379	$ 9,047,984
Estimated net amortization expense of cost of insurance acquired for the next five years [Abstract]
2013 - Estimated interest accretion	1,072,000
2013 - Estimated amortization	1,945,000
2013 - Estimated net amortization	873,000
2014 - Estimated interest accretion	967,000
2014 - Estimated amortization	1,806,000
2014 - Estimated net amortization	839,000
2015 - Estimated interest accretion	866,000
2015 - Estimated amortization	1,672,000
2015 - Estimated net amortization	806,000
2016 - Estimated interest accretion	770,000
2016 - Estimated amortization	1,546,000
2016 - Estimated net amortization	776,000
2017 - Estimated interest accretion	677,000
2017 - Estimated amortization	1,421,000
2017 - Estimated net amortization	$ 744,000

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INCOME TAXES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Income tax expense (benefits) [Abstract]
Current tax	$ 747,714	$ 3,233,286
Deferred tax	(1,680,429)	(2,150,359)
Income tax expense	$ (932,715)	1,082,927
Income tax expense (benefit) reconciliation [Abstract]
United States statutory rate (in hundredths)	35.00%
Tax computed at statutory rate	$ 95,663	3,894,334
Changes in taxes due to [Abstract]
Non-controlling interest	(101,297)	(1,073,704)
Effective Income Tax Rate Reconciliation, Tax Exempt Income, Amount	17,693	17,401
Small company deduction	(552,694)	(134,653)
Dividend received deduction	(100,349)	(1,414,353)
Other	(291,731)	(206,098)
Income tax expense	(932,715)	1,082,927
Deferred tax liability [Abstract]
Investments	(2,735,072)	2,728,928
Cost of insurance acquired	2,849,133	3,166,794
Deferred policy acquisition costs	0	0
Management/consulting fees	(55,125)	(57,454)
Future policy benefits	1,546,770	1,778,105
Deferred gain on sale of subsidiary	2,312,483	2,312,483
Other liabilities	27,406	(127,461)
Federal tax DAC	(540,128)	(387,601)
Deferred income taxes	3,405,467	9,413,794
Gross deferred tax assets	4,896,464	2,405,249
Gross deferred tax liabilities	8,301,931	11,819,043
Valuation Allowance [Line Items]
Valuation allowance	0
Deferred Tax Assets, Operating Loss Carryforwards, Domestic	35,094	17,401
Deferred Tax Assets, Tax Credit Carryforwards, Alternative Minimum Tax	118,693	0
Deferred Tax Assets, Valuation Allowance	118,693	0
allowance -NOL carry forward [Member]
Valuation Allowance [Line Items]
Deferred Tax Assets, Valuation Allowance	$ 35,094	$ 17,401

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CREDIT ARRANGEMENTS (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Scheduled principal reductions on notes payable for the next five years [Abstract]
2013	$ 0
2014	0
2015	0
2016	0
2017	$ 0
HPG Acquisitions 2012-12-27 [Member]
Debt Instrument [Line Items]
Issue Date	Dec. 29, 2014
Maturity Date	Apr. 01, 2018
Outstanding Principal Balance	$ 0	$ 4,400,000
UTG 2013-11-20 [Member]
Lines of Credit [Line Items]
Issue Date	Nov. 20, 2013
Maturity Date	Nov. 20, 2015
Revolving Credit Limit	$ 8,000,000
Outstanding Balance	0	0
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 2013-03-28 [Member]
Lines of Credit [Line Items]
Issue Date	Jun. 02, 2015
Maturity Date	May 19, 2016
Revolving Credit Limit	$ 10,000,000
Outstanding Balance	0	$ 0
Borrowings	0
Repayments	$ 0
UTG Avalon 2014-12-29 [Member]
Lines of Credit [Line Items]
Interest Rate	3.50%
Frequency of Payments	quarterly

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COMMITMENTS AND CONTINGENCIES (Details) - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Investment Commitment [Line Items]
Additional funding commitment		$ 2,000,000
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	4,000,000
Unfunded Commitment	1,179,000
Additional funding commitment		0
Marcellus HBPI, LLP [Member]
Investment Commitment [Line Items]
Total Funding Commitment	500,000
Unfunded Commitment	125,000
MM-Appalachia IV, LP [Member]
Investment Commitment [Line Items]
Total Funding Commitment	1,000,000
Unfunded Commitment	810,000
Additional funding commitment		0
Additional funding commitment subsequently called		$ 0
Sovereign's Capital, LP Fund I [Member]
Investment Commitment [Line Items]
Total Funding Commitment	1,600,000
Unfunded Commitment	$ 120,000

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SHAREHOLDERS' EQUITY (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
STOCK REPURCHASE PROGRAM [Abstract]
Increase in stock repurchase program authorized amount	$ 1,000,000
Stock repurchase program authorized amount	$ 8,000,000
Treasury Stock, Shares, Acquired	25,919
Amount paid to repurchase shares during the year	$ 375,207
Amount of common stock repurchased	$ 6,500,000
Number of common stock acquired (in shares)	688,617
ACAP MERGER [Abstract]
Annual retainer fee paid to Director	$ 8,000
Per meeting fee paid to Director	$ 1,000
Stock Issued During Period, Shares, Restricted Stock Award, Gross	4,245	4,755
Stock issued during period price per share	$ 14.36	$ 14.50
Share-based Compensation, Total	$ 60,958	$ 68,948
EARNINGS PER SHARE CALCULATIONS [Abstract]
Basic Shares (Denominator) (in shares)	3,704,322	3,750,239
Effect of Dilutive Securities (Denominator) (in shares)	0	0
Diluted Shares (Denominator) (in shares)	3,704,322	3,750,239
Minimum statutory surplus required to maintain	$ 2,500,000
Period from declaration of ordinary dividend requires notification to insurance commissioner	five
Minimum period prior to payment of dividend requires notification to insurance commissioner	ten
Percentage of statutory capital and surplus (in hundredths)	10.00%
Ordinary dividends paid	$ 4,000,000	$ 4,800,000
Period for which no extraordinary dividends paid	two

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STATUTORY ACCOUNTING (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Statutory Accounting Practices [Line Items]
Statutory net income	$ 306,059	$ 12,200,025
Statutory capital and surplus	$ 39,752,432	$ 41,146,686

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RELATED PARTY TRANSACTIONS (Details) - USD ($)	3 Months Ended	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2015	Dec. 31, 2014
Related Party Transaction [Line Items]
Purchased trust preferred security offering		$ 4,000,000
Term for mandatory redemption		P30Y
Term for call provision		P5Y
Dividend rate (in hundredths)		6.515%
Dividend Income		$ 264,219	$ 264,219
Equity Method Investments		$ 1,000,000
Ownership interest in aircraft (in hundredths)		8.08%
Additional payment - Aircraft joint ownership agreement		$ 1,600,000
Monthly operational fees	$ 25,000
Costs associated with aircraft		255,920	879,453
Administrative Services and Cost		$ 6,867,882	$ 8,902,568
Servicing fee on loan (in hundredths)		0.25%
Loan origination (in hundredths)		0.50%	0.50%
Servicing fees		$ 11,622	$ 33,894
Origination fees		25,000	0
Reimbursement cost		324,918	325,479
Total reimbursement payment		349,351	332,725
Loans participated to FSF	0	3,170,000	0
Loans participated to FSF after Q1	$ 0	$ 670,000	$ 0
UTG [Member]
Related Party Transaction [Line Items]
Ownership interest in aircraft (in hundredths)		30.10%

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OTHER CASH FLOW DISCLOSURES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
OTHER CASH FLOW DISCLOSURES [Abstract]
Interest expense paid	$ 70,141	$ 635,664
Federal income tax	3,300,000	4,000
Bonds	27,651,746
Common Stock	1,023,394
Cash	2,480,706
Noncash transaction LOC	0.0	$ 4.4
Total reinsurance assets received	$ 31,155,846

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CONCENTRATIONS (Details)	12 Months Ended
	Dec. 31, 2015 USD ($) States	Dec. 31, 2014 USD ($)
CONCENTRATIONS [Abstract]
Number of states by which entity primarily serves | States	4
Percentage of total direct premium from major states (in hundredths)	54.00%	54.00%
Maximum retention limits per life | $	$ 125,000	$ 125,000
Life insurance ceded, percentage (in hundredths)	21.00%	21.00%
Percentage of premium income represents for insurance ceded (in hundredths)	31.00%	29.00%

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Label	Element	Value
Net increase (decrease) in cash and cash equivalents	us-gaap_CashAndCashEquivalentsPeriodIncreaseDecrease	$ (2,154,828)
Net increase (decrease) in cash and cash equivalents	us-gaap_CashAndCashEquivalentsPeriodIncreaseDecrease	$ (5,861,175)