10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2016

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 No. 0-16867

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

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

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

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

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

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company☒

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

Yes ☐ No ☒

The number of shares outstanding of the registrant's common stock as of October 31, 2016 was 3,346,619.

UTG, Inc.

(The "Company")

TABLE OF CONTENTS

PART I.   Financial Information	3
Item 1.  Financial Statements	3
Condensed Consolidated Balance Sheets	3
Condensed Consolidated Statements of Operations	4
Condensed Consolidated Statements of Comprehensive Income (Loss)	5
Condensed Consolidated Statements of Cash Flows	6
Notes to Condensed Consolidated Financial Statements	7
Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations	18
Item 4.  Controls and Procedures	23
PART II.  Other Information	23
Item 1.  Legal Proceedings	23
Item 1A. Risk Factors	23
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds	23
Item 3.  Defaults Upon Senior Securities	23
Item 4.  Mine Safety Disclosures	23
Item 5.  Other Information	23
Item 6.  Exhibits	24
Signatures	25
Exhibit Index	26

Part 1.   Financial Information.

Item 1.  Financial Statements.

UTG, Inc.

Condensed Consolidated Balance Sheets (Unaudited)

		September 30,		December 31,
		2016		2015*
Investments:
Investments available for sale:
Fixed maturities, at fair value (amortized cost $170,781,535 and $188,647,671)	$	192,736,428	$	185,119,097
Equity securities, at fair value (cost $42,769,116 and $43,954,737)		55,550,620		45,685,340
Trading securities, at fair value (cost $70,690 and $0)		70,690		-
Mortgage loans on real estate at amortized cost		22,127,671		17,769,930
Investment real estate		52,831,706		47,650,102
Notes receivable		14,964,213		10,597,907
Policy loans		10,237,206		10,684,244
Total investments		348,518,534		317,506,620
Cash and cash equivalents		12,834,169		11,822,615
Accrued investment income		2,974,160		2,821,338
Reinsurance receivables:
Future policy benefits		27,050,102		27,462,830
Policy claims and other benefits		3,988,997		3,553,978
Cost of insurance acquired		7,485,641		8,140,379
Property and equipment, net of accumulated depreciation		1,677,860		2,016,611
Income tax recoverable		1,415,202		619,043
Other assets		1,450,766		3,283,681
Total assets	$	407,395,431	$	377,227,095
Liabilities:
Policy liabilities and accruals:
Future policyholder benefits	$	265,005,958	$	269,119,859
Policy claims and benefits payable		4,127,905		3,759,565
Other policyholder funds		431,861		457,774
Dividend and endowment accumulations		14,431,294		14,233,644
Deferred income taxes		16,560,332		3,405,467
Notes payable		2,900,000		-
Trading securities, at fair value (proceeds $181,160 and $108,881)		100,887		28,609
Other liabilities		7,323,292		9,234,675
Total liabilities		310,881,529		300,239,593
Shareholders' equity:
Common stock - no par value, stated value $.001 per share.  Authorized 7,000,000 shares - 3,354,711 and 3,699,447 shares outstanding		3,354		3,699
Additional paid-in capital		37,953,044		43,002,670
Retained earnings		33,950,873		33,062,282
Accumulated other comprehensive income (loss)		22,644,059		(1,183,552)
Total UTG shareholders' equity		94,551,330		74,885,099
Noncontrolling interests		1,962,572		2,102,403
Total shareholders' equity		96,513,902		76,987,502
Total liabilities and shareholders' equity	$	407,395,431	$	377,227,095

* Balance sheet audited at December 31, 2015.

See accompanying notes.

UTG, Inc.

Condensed Consolidated Statements of Operations (Unaudited)

		Three Months Ended				Nine Months Ended
		September 30,		September 30,		September 30,		September 30,
		2016		2015		2016		2015
Revenue:
Premiums and policy fees	$	2,996,420	$	2,706,709	$	8,812,151	$	8,505,704
Ceded reinsurance premiums and policy fees		(740,340)		(825,134)		(2,244,538)		(2,382,376)
Net investment income		2,850,301		3,955,407		10,079,273		11,965,809
Other income		90,209		145,141		385,756		460,571
Revenues before realized gains (losses)		5,196,590		5,982,123		17,032,642		18,549,708
Realized investment gains (losses), net:
Other-than-temporary impairments		-		-		-		-
Other realized investment gains, net		1,855,576		3,305,835		5,923,373		7,732,155
Total realized investment gains (losses), net		1,855,576		3,305,835		5,923,373		7,732,155
Total revenue		7,052,166		9,287,958		22,956,015		26,281,863
Benefits and other expenses:
Benefits, claims and settlement expenses:
Life		5,024,528		5,484,256		16,407,007		15,357,486
Ceded Reinsurance benefits and claims		(511,137)		(1,447,479)		(2,017,207)		(2,569,732)
Annuity		260,264		263,198		887,840		793,432
Dividends to policyholders		93,053		92,660		342,287		344,258
Commissions and amortization of deferred policy acquisition costs		(21,923)		(47,886)		(93,865)		(132,162)
Amortization of cost of insurance acquired		218,246		226,901		654,738		680,703
Operating expenses		1,792,990		2,057,074		5,471,329		6,404,256
Interest expense		-		8,618		-		70,141
Total benefits and other expenses		6,856,021		6,637,342		21,652,129		20,948,382
Income before income taxes		196,145		2,650,616		1,303,886		5,333,481
Income tax (expense) benefit		152,829		(731,082)		(339,658)		(1,545,975)
Net income (loss)		348,974		1,919,534		964,228		3,787,506
Net (income) loss attributable to noncontrolling interests		(29,663)		(22,822)		(75,636)		(174,828)
Net income attributable to common shareholders	$	319,311	$	1,896,712	$	888,592	$	3,612,678
Amounts attributable to common shareholders'
Basic income per share	$	0.09	$	0.51	$	0.25	$	0.97
Diluted income per share	$	0.09	$	0.51	$	0.25	$	0.97
Basic weighted average shares outstanding		3,439,426		3,700,180		3,602,164		3,706,741
Diluted weighted average shares outstanding		3,439,426		3,700,180		3,602,164		3,706,741

See accompanying notes.

UTG, Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)

		Three Months Ended				Nine Months Ended
		September 30,		September 30,		September 30,		September 30,
		2016		2015		2016		2015
Net income (loss)	$	348,974	$	1,919,534	$	964,228	$	3,787,506
Other comprehensive income (loss):
Unrealized holding gains (losses) arising during period, pre-tax		7,196,483		(6,646,467)		38,064,491		(7,093,248)
Tax (expense) benefit on unrealized holding gains (losses) arising during the period		(2,518,769)		2,326,264		(13,322,572)		2,482,637
Unrealized holding gains (losses) arising during period, net of tax		4,677,714		(4,320,203)		24,741,919		(4,610,611)
Less reclassification adjustment for gains included in net income		(709,955)		(369,524)		(1,406,628)		(1,192,575)
Tax expense  for gains included in net income		248,484		129,333		492,320		417,401
Reclassification adjustment for gains included in net income, net of tax		(461,471)		(240,191)		(914,308)		(775,174)
Subtotal:  Other comprehensive income (loss), net of tax		4,216,243		(4,560,394)		23,827,611		(5,385,785)
Comprehensive income (loss)		4,565,217		(2,640,860)		24,791,839		(1,598,279)
Less comprehensive (income) loss attributable to noncontrolling interests		(29,663)		(22,822)		(75,636)		(174,828)
Comprehensive income (loss) attributable to UTG, Inc.	$	4,535,554	$	(2,663,682)	$	24,716,203	$	(1,773,107)

See accompanying notes.

Condensed Consolidated Statements of Cash Flows (Unaudited)

		Nine Months Ended
		September 30,		September 30,
		2016		2015
Cash flows from operating activities:
Net income attributable to common shareholders	$	888,592	$	3,612,678
Adjustments to reconcile net income to net cash used in operating activities:
Amortization (accretion) of investments		(553,517)		(2,887,463)
Realized investment gains, net		(5,923,373)		(7,732,155)
Unrealized trading (gains) losses included in income		-		964,122
Amortization of cost of insurance acquired		654,738		680,703
Depreciation		500,538		609,600
Net income (loss) attributable to noncontrolling interest		75,636		174,828
Charges for mortality and administration of universal life and annuity products		(2,116,902)		(4,980,737)
Interest credited to account balances		3,466,719		3,680,292
Change in accrued investment income		(152,822)		9,882
Change in reinsurance receivables		(22,291)		(73,846)
Change in policy liabilities and accruals		(1,897,222)		(2,906,385)
Change in income taxes receivable (payable)		(796,159)		(1,199,276)
Change in other assets and liabilities, net		603,671		(4,399,062)
Net cash used in operating activities		(5,272,392)		(14,446,819)
Cash flows from investing activities:
Proceeds from investments sold and matured:
Fixed maturities available for sale		26,829,015		19,216,266
Equity securities available for sale		4,506,115		7,128,725
Trading securities		72,279		125,774
Mortgage loans		3,482,189		19,739,596
Real estate		9,939,470		17,041,627
Notes receivable		2,778,401		-
Policy loans		1,465,996		2,228,637
Short-term investments		-		828,476
Total proceeds from investments sold and matured		49,073,465		66,309,101
Cost of investments acquired:
Fixed maturities available for sale		(7,919,941)		(16,641,310)
Equity securities available for sale		(2,475,777)		(9,531,330)
Trading securities		(70,690)		(463,895)
Mortgage loans		(6,922,723)		(11,297,550)
Real estate		(11,937,317)		(6,395,223)
Notes receivable		(7,144,707)		0
Policy loans		(1,018,958)		(1,933,945)
Short-term investments		-		(79,925)
Total cost of investments acquired		(37,490,113)		(46,343,178)
Net cash provided by investing activities		11,583,352		19,965,923
Cash flows from financing activities:
Policyholder contract deposits		407,633		3,977,725
Policyholder contract withdrawals		(3,434,052)		(4,159,165)
Purchase of treasury stock		(5,049,971)		(150,336)
Non controlling contributions (distributions) of consolidated subsidiary		(123,016)		(539,337)
Net cash used in financing activities		(5,299,406)		(5,271,113)
Net increase in cash and cash equivalents		1,011,554		247,991
Cash and cash equivalents at beginning of period		11,822,615		13,977,443
Cash and cash equivalents at end of period	$	12,834,169	$	14,225,434

See accompanying notes.

UTG, Inc.

Notes to Condensed Consolidated Financial Statements

Note 1 – Basis of Presentation

The accompanying Condensed Consolidated Balance Sheet as of December 31, 2015, which has been derived from audited consolidated financial statements, and the unaudited interim Condensed Consolidated Financial Statements include the accounts of UTG, Inc. (the "Parent") and its subsidiaries (collectively with the Parent, the "Company").  All significant intercompany accounts and transactions have been eliminated in consolidation.  The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 8 of regulation S-X.  Accordingly, they do not include all of the information and notes required by GAAP for audited annual financial statements.  The information furnished includes all adjustments and accruals of a normal recurring nature, which in the opinion of Management, are necessary for a fair presentation of the results for the interim periods.  The unaudited Condensed Consolidated Financial Statements included herein and these related notes should be read in conjunction with the Company's consolidated financial statements, and the notes thereto, included in the Company's Annual Report on Form 10-K for the year ended December 31, 2015.  The Company's results of operations for the three and nine month periods ended  September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016 or for any other future period.

This document at times will refer to the Registrant's largest shareholder, Mr. Jesse T. Correll and certain companies controlled by Mr. Correll.  Mr. Correll holds a majority ownership of First Southern Funding, LLC ("FSF"), a Kentucky corporation, and First Southern Bancorp, Inc. ("FSBI"), a financial services holding company.  FSBI operates through its 100% owned subsidiary bank, First Southern National Bank ("FSNB").  Banking activities are conducted through multiple locations within south-central and western Kentucky.  Mr. Correll is Chief Executive Officer and Chairman of the Board of Directors of UTG and is currently UTG's largest shareholder through his ownership control of FSF, FSBI and affiliates.  At September 30, 2016, Mr. Correll owns or controls directly and indirectly approximately  63.65% of UTG's outstanding stock.

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

Note 2 – 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.

Note 3 – Investments

Available for Sale Securities – Fixed Maturity and Equity Securities

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

Investments in available for sale securities are summarized as follows:

September 30, 2016		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	$	9,055,395	$	156,931	$	-	$	9,212,326
U.S. special revenue and assessments		10,144,111		1,259,164		-		11,403,275
Collateralized mortgage obligations		-		-		-		-
Public utilities		-		-		-		-
All other corporate bonds		151,582,029		20,831,255		(292,457)		172,120,827
		170,781,535		22,247,350		(292,457)		192,736,428
Equity securities		42,769,116		13,411,230		(629,726)		55,550,620
Total	$	213,550,651	$	35,658,580	$	(922,183)	$	248,287,048

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
States, municipalities and political subdivisions		-		-		-		-
U.S. special revenue and assessments		1,137,546		7,843		(2,550)		1,142,839
Collateralized mortgage obligations		-		-		-		-
Public utilities		-		-		-		-
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

The amortized cost and estimated market value of debt securities at September 30, 2016, by contractual maturity, is shown below.  Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Fixed Maturities Available for Sale September 30, 2016		Amortized Cost		Estimated Fair Value
Due in one year or less	$	1,730,616	$	1,824,054
Due after one year through five years		26,748,038		28,673,722
Due after five years through ten years		53,227,304		64,681,864
Due after ten years		88,767,630		97,556,788
Total	$	170,781,535	$	192,736,428

The fair value of investments with sustained gross unrealized losses at September 30, 2016 and December 31, 2015 are as follows:

September 30, 2016		Less than 12 months			12 months or longer			Total
		Fair value	Unrealized losses		Fair value	Unrealized losses		Fair value	Unrealized losses
All other corporate bonds		2,782,185	(37,793)		5,986,860	(254,664)		8,769,045	(292,457)
Total fixed maturities	$	2,782,185	(37,793)	$	5,986,860	(254,664)	$	8,769,045	(292,457)
Equity securities	$	4,419,011	(629,726)	$	-	-	$	4,419,011	(629,726)

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)	$	-	-	$	4,966,210	(32,083)
U.S. special revenue and assessments		984,770	(2,550)		-	-		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)	$	-	-	$	4,741,132	(388,602)

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

	Less than 12 months	12 months or longer	Total
As of September 30, 2016
Fixed maturities	3	4	7
Equity securities	3	-	3
As of December 31, 2015
Fixed maturities	40	9	49
Equity securities	9	-	9

Substantially all of the unrealized losses on fixed maturities available for sale and equity securities at  September 30, 2016 and December 31, 2015 are attributable to changes in market interest rates and general disruptions in the credit market subsequent to purchase.  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  September 30, 2016 and December 31, 2015.

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

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

Based on Management's review of the investment portfolio, the Company did not record any losses for other-than-temporary impairments in the Condensed Consolidated Statements of Operations for the nine-month period ended   September 30, 2016 and 2015.

Trading Securities

Securities designated as trading securities are reported at fair value, with gains or losses resulting from changes in fair value recognized in net investment income on the Condensed Consolidated Statements of Operations.  Trading securities include exchange-traded equities and exchange-traded options.  Trading securities carried as liabilities are securities sold short. A gain, limited to the price at which the security was sold short, or a loss, potentially unlimited in size, will be recognized upon the termination of the short sale.  The fair value of derivatives included in trading security assets and trading security liabilities as of   September 30, 2016 was $70,690 and $(100,887), respectively. 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.  Earnings from trading securities are classified in cash flows from operating activities. The derivatives held by the Company are for income generation purposes only.

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

		Three Months Ended
		September 30,
		2016		2015
Net unrealized gains (losses)	$	-	$	55,140
Net realized gains (losses)		-		-
Net unrealized and realized gains (losses)	$	-	$	55,140

		Nine Months Ended
		September 30,
		2016		2015
Net unrealized gains (losses)	$	-	$	(964,122)
Net realized gains (losses)		-		515,967
Net unrealized and realized gains (losses)	$	-	$	(448,155)

Mortgage Loans

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 23% and 30 % of the mortgage loan portfolio consists of discounted commercial mortgage loans as of September 30, 2016 and December 31, 2015, 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 2016 and 2015, the Company acquired $6.3 million and $13.8 million 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 2016 and 2015, the maximum and minimum lending rates for mortgage loans were:

	2016		2015
	Maximum rate	Minimum rate	Maximum rate	Minimum rate
Commercial Loans	8.50%	3.94%	8.00%	4.00%
Residential Loans	8.00%	3.00%	8.00%	3.00%

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  33.0% and 39.0% of face value as of September 30, 2016 and December 31, 2015, respectively.  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 September 30, 2016 and December 31, 2015.

The following table summarizes the number of loans held in the discounted mortgage loan portfolio and the carrying value of the loans:

September 30, 2016 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	6		5,095,738
Total	17	$	5,116,572

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:

		September 30, 2016		December 31, 2015
In good standing	$	19,910,147	$	14,701,228
Overdue interest over 90 days		20,834		20,834
Restructured		63,826		126,118
In process of foreclosure		2,132,864		2,921,750
Total mortgage loans	$	22,127,671	$	17,769,930
Total foreclosed loans during the year	$	735,000	$	-

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  September 30, 2016 and December 31, 2015 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. 

Note 4 – Fair Value Measurements

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

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

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

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

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

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

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

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

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

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

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

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

Securities designated as trading securities consist of 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 Condensed Consolidated Balance Sheet on a recurring basis as of September 30, 2016.

		Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	9,212,326	$	180,834,568	$	2,689,534	$	192,736,428
Equity Securities, available for sale		20,138,222		6,649,691		28,762,707		55,550,620
Trading Securities		70,690		0		0		70,690
Total	$	29,421,238	$	187,484,259	$	31,452,241	$	248,357,738
Liabilities
Trading Securities	$	100,887	$	-	$	-	$	100,887

The following table presents the Company's assets and liabilities measured at fair value in the Condensed Consolidated Balance Sheet on a recurring basis as of December 31, 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	$	-	$	-	$	28,609

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, 2015	$	1,026,694	$	26,805,948	$	27,832,642
Total unrealized gains (losses):
Included in realized gains (losses)		94,549		-		94,549
Included in other comprehensive income		1,700,626		2,173,151		3,873,777
Purchases		-		980,758		980,758
Sales		(132,335)		(1,197,150)		(1,329,485)
Balance at September 30, 2016	$	2,689,534	$	28,762,707	$	31,452,241

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 September 30, 2016.  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.

		September 30, 2016				December 31, 2015
Assets		Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Mortgage loans on real estate	$	22,127,671	$	22,127,671	$	17,769,930	$	17,775,178
Investment real estate		52,831,706		52,831,706		47,650,102		47,650,102
Notes receivable		14,964,213		14,964,213		10,597,907		10,597,907
Policy loans		10,237,206		10,237,206		10,684,244		10,684,244
Cash and cash equivalents		12,834,169		12,834,169		11,822,615		11,822,615

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 Condensed 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 5 – Credit Arrangements

At September 30, 2016 and December 31, 2015, the Company had the following outstanding debt:

				Outstanding Principal Balance
Instrument	Issue Date	Maturity Date		September 30, 2016		December 31, 2015
Promissory Note:
SoftVest, LP	7/22/2016	7/22/2018	$	1,450,000	$	0
SoftSearch, L.P.	7/22/2016	7/22/2018	$	1,450,000	$	0

Instrument	Issue Date	Maturity Date		Revolving Credit Limit		December 31, 2015	Borrowings	Repayments		September 30, 2016
Lines of Credit:
UTG	2013-11-20	2016-11-20	$	8,000,000	$	-	-	-	$	-
UG	2015-06-02	2017-05-10		10,000,000		-	-	-		-

The UTG line of credit carries interest at a fixed rate of  3.75% and is payable monthly. As collateral, UTG has pledged 100% of the common voting stock of its wholly owned subsidiary, Universal Guaranty Life Insurance Company ("UG").  The Company is currently in the process of renewing this line of credit.

During May of 2016, 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.

On July 22, 2016, the Company entered in to an agreement to acquire 300,000 shares of its outstanding common stock from a shareholder that owned approximately 8 % of the Company's outstanding common stock.  The acquisition was made under the Company's stock buy-back program. As part of this transaction, two promissory notes totaling $2.9 million were issued. The notes require principal payments of one half of the note value to be paid one year from the date of purchase and the other one half to be paid two years from the date of purchase. The notes bear interest at 0%.

Note 6 – Shareholders' Equity

Stock Repurchase Programs

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 15, 2016, the Board of Directors of UTG authorized the repurchase of up to an additional $2 million of UTG's common stock and on July 14, 2016, the Board of Directors again increased the amount available by an additional $4.5 million, for a total repurchase of $14.5 million. Repurchased shares are available for future issuance for general corporate purposes. Company Management has broad authority to operate the program, including the discretion of whether to purchase shares and the ability to suspend or terminate the program. Open market purchases are made based on the last available market price but may be limited.  During the nine month period ended September

30, 2016, the Company repurchased approximately $364,000shares through the stock repurchase program for approximately $5,297,000. Through September 30, 2016, UTG has spent approximately $11.8 million in the acquisition of approximately 1,050,000shares under this program.

As mentioned in Note 5 above, on July 22, 2016 the Company entered in to an agreement to acquire 300,000 shares of its outstanding common stock from a shareholder that owned approximately 8 % of the Company's outstanding common stock. The purchase price per share was $14.50 and was paid with cash and was derived through private negotiation. The purchase was paid with cash and the issuance of promissory notes.

Earnings Per Share Calculations

Earnings per share are based on the weighted average number of common shares outstanding during each period.  For the three and nine months period ended September 30, 2016 and 2015, diluted earnings per share were the same as basic earnings per share since the Company had no dilutive instruments outstanding.

Note 7 – Commitments and Contingencies

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

Under the insurance guaranty fund laws in most states, insurance companies doing business in a participating state can be assessed up to prescribed limits for policyholder losses incurred by insolvent or failed insurance companies.  Although the Company cannot predict the amount of any future assessments, most insurance guaranty fund laws currently provide that an assessment may be excused or deferred if it would threaten an insurer's financial strength.  Mandatory assessments may be partially recovered through a reduction in future premium tax in some states. The Company does not believe such assessments will be materially different from amounts already provided for in the condensed consolidated 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 September 30, 2016 related to certain investments:

		Total Funding		Unfunded
		Commitment		Commitment
RLF III, LLC	$	4,000,000	$	398,120
Sovereign's Capital, LP Fund I		500,000		56,142
UGLIC, LLC		1,600,000		120,000
Sovereign's Capital, LP Fund II		1,000,000		730,000
Barton Springs Music, LLC		2,500,000		1,668,100
Master Mineral Holdings II, LP		4,122,167		2,315,786
PBEX II, LLC		5,000,000		527,157

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 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.

During 2016, the Company made a commitment to invest in Barton Springs Music, LLC ("Barton"), which invests in music royalties.  Barton makes capital calls to its investors as funds are needed to acquire the royalty rights.

During 2016, the Company made a commitment to invest in Master Mineral Holdings II, LP ("MMH"), which purchases land for leasing opportunities to those looking to harvest natural resources.  MMH makes capital calls to its investors as funds are needed for continued land purchases.

During 2016, the Company made a commitment to invest in PBEX II, LLC ("PBEX"), which purchases land for leasing opportunities to those looking to harvest natural resources.  PBEX makes capital calls to its investors as funds are needed for continued land purchases.

Note 8 – Other Cash Flow Disclosures

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

		Three Months Ended
		September 30,
		2016		2015
Interest	$	-	$	70,141
Federal income tax		33,000		-

		Nine Months Ended
		September 30,
		2016		2015
Interest	$	-	$	-
Federal income tax		768,000		3,000,000

Note 9 – Concentrations of Credit Risk

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

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

The following is Management's discussion and analysis of the financial condition and results of operations of UTG, Inc. and its subsidiaries (collectively with the Parent, the "Company").  The following discussion of the financial condition and results of operations of the Company should be read in conjunction with, and is qualified in its entirety by reference to, the Consolidated Financial Statements of the Company and the related Notes thereto appearing in the Company's annual report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission, and our unaudited Condensed Consolidated Financial Statements and related Notes thereto appearing elsewhere in this quarterly report.

Cautionary Statement Regarding Forward-Looking Statements

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

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

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

Overview

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

Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts and related disclosures. Actual results could differ significantly from those estimates.  The Company has identified certain estimates that involve a higher degree of judgment and are subject to a significant degree of variability.  The Company's critical accounting policies and the related estimates considered most significant by Management are disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2015.  Management has identified the accounting policies related to cost of insurance acquired, assumptions and judgments utilized in determining if declines in fair values of investments are other-than-temporary, and valuation methods for investments that are not actively traded as those, due to the judgments, estimates and assumptions inherent in those policies, are critical to an understanding of the Company's Condensed Consolidated Financial Statements and this Management's Discussion and Analysis.

During the nine months ended September 30, 2016, there were no additions to or changes in the critical accounting policies disclosed in the 2015 Form 10-K, except for recently adopted accounting standards discussed in Note 2 of the Notes to the Condensed Consolidated Financial Statements.

Results of Operations

On a consolidated basis, the Company reported net income attributable to common shareholders' of approximately $889,000 for the nine-month period ended September 30, 2016 and a net income attributable to common shareholders' of approximately $319,000 for the three-month period ended September 30, 2016.  For the nine-month period ended September 30, 2015, the Company reported net income attributable to common shareholders' of approximately $3.6 million and for the three-month period ended September 30, 2015, the Company reported net income attributable to common shareholders' of approximately $1,897,000.

Revenues

The Company's total revenues decreased approximately 12% when comparing the nine month periods ended September 30, 2016 and 2015. The Company's revenues decreased by approximately 24% when comparing the three month periods ended September 30, 2016 and 2015. The variance in total revenues reported, year to date and for the quarter, is mainly attributable to fluctuations in net investment income and realized gains reported by the Company during 2016 and 2015. Further analysis of the fluctuations is provided below.

Premium and policy fee revenues, net of reinsurance, increased approximately 7% when comparing the first nine months of 2016 to the same period in 2015.  Premium and policy fee revenues, net of reinsurance, increased by approximately 20% when comparing the third quarter of 2016 to the same quarter in 2015.  The Company writes minimal new business.  Premium and policy fee revenues, net of reinsurance, represented 29% and 23% of the Company's revenues as of September 30, 2016 and 2015, respectively.

The following table reflects net investment income of the Company for the three and nine month periods ended September 30, 2016:

		Three Months Ended				Nine Months Ended
		September  30,				September  30,
		2016		2015		2016		2015
Fixed maturities available for sale	$	2,308,923	$	2,147,874	$	6,946,490	$	6,340,727
Equity securities		297,682		64,157		998,544		1,372,941
Trading securities		(119,749)		55,140		(80,272)		(448,155)
Mortgage loans		314,128		1,535,320		1,566,902		5,439,285
Real estate		363,052		917,362		1,489,981		1,371,107
Notes receivable		284,142		0		1,225,723		133,738
Policy loans		177,317		161,403		442,435		477,905
Short-term		7,877		53,182		7,877		220,588
Cash and cash equivalents		10,905		70		20,465		636
Total consolidated investment income		3,644,277		4,934,508		12,618,145		14,908,772
Investment expenses		(793,976)		(979,101)		(2,538,872)		(2,942,963)
Consolidated net investment income	$	2,850,301	$	3,955,407	$	10,079,273	$	11,965,809

Net investment income represented 44% and 46% of the Company's total revenues as of September 30, 2016 and 2015, respectively.  The Company reported net investment income of approximately $10.1 million for the nine-month period ended September 30, 2016, a decrease of approximately 16% compared to the same period in 2015.  For the three-month period ended September 30, 2016, net investment income decreased approximately 28% or $1.1 million, compared to the same quarter in 2015. The fluctuation in net investment income for the three and nine month periods ended September 30, 2016, compared to the same periods in 2015, is the result of a shift in income received by multiple investment types.

The most significant shift in investment income was in the mortgage loan portfolio.  Mortgage loan income was down approximately 71% and 80% for the nine-month and three-month periods ending September 30, 2016.  This is the result of continued pay off of loans within the portfolio particularly the discounted mortgage loans that have in recent periods provided significant earnings.  These declines were partially offset by increases in the fixed maturities portfolio and notes receivable.  Funds received from mortgage loan pay-downs were redeployed in other investment types such as fixed maturities and notes receivable.

The Company reported net realized investment gains of approximately $5.9 million and $7.7 million for the nine month periods ended September 30, 2016 and 2015, respectively.  During the third quarter of 2016 and 2015, the Company reported net realized investment gains of approximately $1.9 million and $3.3 million, respectively. During 2016, the Company sold a parcel of real estate in first quarter and sold certain fixed maturity investments and equity investments during the third quarter which produced a majority of the gains reported.  The sale of fixed maturity and equity investments during the third quarter was the result of significant shifts in the marketplace that management felt was a good time to be opportunistic.  The 2015 gains were primarily the result of two parcels of real estate sold, one during first quarter and the other during third quarter.  Realized investment gains are the result of one-time events and are expected to vary from quarter to quarter.

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 approximately $21.7 million for the nine-month period ended September 30, 2016, an increase of approximately 3% from the same period in 2015.  For the three-month period ended September 30, 2016, total benefits and other expenses increased approximately 3%, compared to the same quarter in 2015.  Benefits, claims and settlement expenses represented approximately 72% of the Company's total expenses for the nine-month period ended September 30, 2016 and 71% for the three-month period ended September 30, 2016.  The other major expense category of the Company is operating expenses, which represented approximately 26% and 25% of the Company's total expenses for the three and nine month periods ended September 30, 2016, respectively.

Life benefits, claims and settlement expenses, net of reinsurance benefits and claims, increased approximately 11% in the nine-month period ended September 30, 2016, compared to the same period in 2015.  For the three-month period ended September 30, 2016, life benefits, claims and settlement expenses, net of reinsurance benefits and claims, increased approximately 12%, compared to the same quarter in 2015.  Policy claims vary from period to period and therefore, fluctuations in mortality are to be expected and are not considered unusual by Management.

Net amortization of cost of insurance acquired decreased4% during the nine-month and three-month periods ended September 30, 2016 compared to the same period in 2015.  Cost of insurance acquired is established when an insurance company is acquired or when the Company acquires a block of in-force business.  The Company assigns a portion of its cost to the right to receive future profits from insurance contracts existing at the date of the acquisition.  Cost of insurance acquired is amortized with interest in relation to expected future profits, including direct charge-offs for any excess of the unamortized asset over the projected future profits. The interest rates may vary due to risk analysis performed at the time of acquisition on the business acquired. The Company utilizes a 12% discount rate on the remaining unamortized business.  The amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised.  Amortization of cost of insurance acquired is particularly sensitive to changes in interest rate spreads and persistency of certain blocks of insurance in-force.  This expense is expected to decrease, unless the Company acquires a new block of business.

Operating expenses decreased approximately 15% in the nine-month period ended September 30, 2016 in comparison to the same period in 2015.  Third quarter 2016 operating expenses were down approximately 13% compared to operating expenses reported in the third quarter of 2015. In comparison to the prior year, operating expenses were comparable or slightly lower in the majority of the major expense categories. Salaries and charitable contributions recognized the largest decrease when comparing 2016 and 2015 results.  Salary expense is down slightly as a result of changes in staffing. Charitable contributions are a function of the Company's earnings.

UTG has a strong philanthropic program. The Company generally allocates a portion of its taxable income 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.

During 2015, Management determined it was in the Company's best long term interest to relocate its main operations from Springfield, IL 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 expected to be substantially complete by December 31, 2016.  Significant time and planning has been put into this relocation to help ensure as smooth a transition as possible.

Financial Condition

Investment Information

Investments represent approximately 86% and 84% of total assets at September 30, 2016 and December 31, 2015, respectively.  Accordingly, investments are the largest asset group of the Company.  The Company's insurance subsidiary is regulated by insurance statutes and regulations as to the type of investments that it is permitted to make and the amount of funds that may be used for any one type of investment.  In light of these statutes and regulations, the majority of the Company's investment portfolio is invested in a diverse set of securities.

As of September 30, 2016, 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 gains of approximately $39 million for the nine-month period ended September 30, 2016 and $19 million for the third quarter of 2016.  Changes in the market value of available for sale securities resulted in net unrealized losses of approximately $4.2 million and $(447,000) for the three and nine-month periods ended September 30, 2015, respectively. The variance in the net unrealized gains and losses is the result of normal market fluctuations and lower interest rates.

Capital Resources

Total shareholders' equity increased by approximately 25% as of September 30, 2016 compared to December 31, 2015. The increase in total shareholders' equity was the result of an increase in accumulated other comprehensive income, which is attributable to the increase in unrealized gains mentioned above.

The Company's investments are predominately 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 Condensed Consolidated Financial Statements at their market value.

Liquidity

The Company has three principal needs for cash - the insurance company's contractual obligations to policyholders, the payment of operating expenses and debt service.  Cash and cash equivalents represented 3% of total assets as of September 30, 2016 and December 31, 2015, respectively.  Fixed maturities as a percentage of total assets were approximately 47% and 49% as of September 30, 2016 and December 31, 2015, respectively.

The Company currently has access to funds for operating liquidity.  UTG has an $8,000,000 revolving credit note with Illinois National Bank.  At September 30, 2016, the Company had no outstanding borrowings against the UTG line of credit.

Future policy benefits are primarily long-term in nature and therefore, the Company's investments are predominantly in long-term fixed maturity investments such as bonds and mortgage loans which provide sufficient return to cover these obligations. Many of the Company's products contain surrender charges and other features which reward persistency and penalize the early withdrawal of funds.

Net cash used in operating activities was approximately $5.3 million and $14.4 million for the nine-month periods ended September 30, 2016 and 2015, 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.  Management anticipates future cash flows from operations to remain similar to historic trends.

Net cash provided by investing activities was approximately $11.6 million and $20 million for the nine-month periods ended September 30, 2016 and 2015, respectively. The net cash provided by investing activities is expected to vary from quarter to quarter depending on market conditions and management's ability to find and negotiate favorable investment contracts.

Net cash used in financing activities was approximately $5.3 million for the nine-month periods ended September 30, 2016 and 2015.

UTG is a holding Company that has no day-to-day operations of its own.  Funds required to meet its expenses, generally costs associated with maintaining the Company in good standing with states in which it does business and the servicing of its debt, are primarily provided by its subsidiaries.  On a parent only basis, UTG's cash flow is dependent on Management fees received from its insurance subsidiary, stockholder dividends from its subsidiary and earnings received on cash balances.  At September 30, 2016, substantially all of the consolidated shareholders' equity represented net assets of its subsidiary.  The Company's insurance subsidiary has maintained adequate statutory capital and surplus.  The payment of cash dividends to shareholders by UTG is not legally restricted.  However, the state insurance department regulates insurance Company dividend payments where the Company is domiciled.  No dividends were paid to shareholders in 2015 or the nine-month period ended September 30, 2016.

UG is an Ohio domiciled insurance company, which requires notification within five business days to the insurance commissioner following the declaration of any ordinary dividend and at least ten calendar days prior to payment of such dividend.  Ordinary dividends are defined as the greater of:  a) prior year statutory net income or b) 10% of statutory capital and surplus.  For the year ended December 31, 2015, UG had statutory net income of approximately $306,000.  At December 31, 2015 UG's statutory capital and surplus amounted to approximately $39.8 million.  Extraordinary dividends (amounts in excess of ordinary dividend limitations) require prior approval of the insurance commissioner and are not restricted to a specific calculation.  During 2015, UG paid UTG ordinary dividends of $4 million.  UTG used the dividends received during 2015 for general operations of the Company.   During the third quarter of 2016, UG paid UTG an ordinary dividend of $1 million. UTG used the dividend received during 2016 for general operations of the Company.

ITEM 4.  CONTROLS AND PROCEDURES

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

PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

NONE

ITEM 1A.  RISK FACTORS

NONE

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

NONE

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

NONE

ITEM 4.  MINE SAFETY DISCLOSURES

NONE

ITEM 5.  OTHER INFORMATION

NONE

ITEM 6.  EXHIBITS

*31.1	Certification of Jesse T. Correll, Chief Executive Officer and Chairman of the Board of UTG, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*31.2	Certification of Theodore C. Miller, Chief Financial Officer, Senior Vice President and Corporate Secretary of UTG, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*32.1	Certificate of Jesse T. Correll, Chief Executive Officer and Chairman of the Board of UTG, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
*32.2	Certificate of Theodore C. Miller, Chief Financial Officer, Senior Vice President and Corporate Secretary of UTG, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
**101	Interactive Data File

*Filed herewith

SIGNATURES

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

UTG, INC.

(Registrant)

Date:	November 14, 2016	By	/s/ James P. Rousey
			James P. Rousey
			President and Director

Date:	November 14, 2016	By	/s/ Theodore C. Miller
			Theodore C. Miller
			Senior Vice President
			and Chief Financial Officer

EXHIBIT INDEX

Exhibit Number Description

*31.1	Certification of Jesse T. Correll, Chief Executive Officer and Chairman of the Board of UTG, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*31.2	Certification of Theodore C. Miller, Chief Financial Officer, Senior Vice President and Corporate Secretary of UTG, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
*32.1	Certificate of Jesse T. Correll, Chief Executive Officer and Chairman of the Board of UTG, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
*32.2	Certificate of Theodore C. Miller, Chief Financial Officer, Senior Vice President and Corporate Secretary of UTG, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
**101	Interactive Data File

* Filed herewith

EX-31.1

Exhibit 31.1 CERTIFICATIONS
I, Jesse T. Correll, Chairman of the Board and Chief Executive Officer of UTG, Inc., certify that:
1.	I have reviewed this quarterly report on Form 10-Q of the registrant, UTG, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)and 15d-15(f)) for the registrant and have:
	a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c.	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d.	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
	a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.

Date:	November 14, 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 quarterly report on Form 10-Q of the registrant, UTG, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)and 15d-15(f)) for the registrant and have:
	a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c.	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d.	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
	a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.

Date:	November 14, 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 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of UTG, Inc. (the "Company") for the period ended September 30, 2016, 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:	November 14, 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 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of UTG, Inc. (the "Company") for the period ended September 30, 2016as 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:	November 14, 2016	By:	/s/ Theodore C. Miller
			Theodore C. Miller
			Senior Vice President, Corporate
			Secretary and Chief Financial Officer

XML

Document and Entity Information	9 Months Ended
	Sep. 30, 2016 shares
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 Common Stock, Shares Outstanding	3,354,711
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2016

XML

Condensed Consolidated Balance Sheets (Unaudited) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Investments available for sale:
Fixed maturities, at fair value (amortized cost $170,781,535 and $188,647,671)	$ 192,736,428	$ 185,119,097
Equity securities, at fair value (cost $42,769,116 and $43,954,737)	55,550,620	45,685,340
Trading securities, at fair value (cost $70,690 and $0)	70,690	0
Mortgage loans on real estate at amortized cost	22,127,671	17,769,930
Discounted mortgage loans on real estate at cost	0	0
Investment real estate	52,831,706	47,650,102
Notes receivable	14,964,213	10,597,907
Policy loans	10,237,206	10,684,244
Short-term investments	0	0
Total investments	348,518,534	317,506,620
Cash and cash equivalents	12,834,169	11,822,615
Accrued investment income	2,974,160	2,821,338
Reinsurance receivables:
Future policy benefits	27,050,102	27,462,830
Policy claims and other benefits	3,988,997	3,553,978
Cost of insurance acquired	7,485,641	8,140,379
Property and equipment, net of accumulated depreciation	1,677,860	2,016,611
Income tax receivable	1,415,202	619,043
Other assets	1,450,766	3,283,681
Total assets	407,395,431	377,227,095
Policy liabilities and accruals:
Future policyholder benefits	265,005,958	269,119,859
Policy claims and benefits payable	4,127,905	3,759,565
Other policyholder funds	431,861	457,774
Dividend and endowment accumulations	14,431,294	14,233,644
Income tax payable	0	0
Deferred income taxes	16,560,332	3,405,467
Notes payable	2,900,000	0
Trading securities, at fair value (proceeds $181,160 and $108,881)	100,887	28,609
Other liabilities	7,323,292	9,234,675
Total liabilities	310,881,529	300,239,593
Shareholders' equity:
Common stock - no par value, stated value $.001 per share. Authorized 7,000,000 shares - 3,354,711 and 3,699,447 shares outstanding	3,354	3,699
Additional paid-in capital	37,953,044	43,002,670
Retained earnings	33,950,873	33,062,282
Accumulated other comprehensive income	22,644,059	(1,183,552)
Total UTG shareholders' equity	94,551,330	74,885,099
Noncontrolling interests	1,962,572	2,102,403
Total shareholders' equity	96,513,902	76,987,502
Total liabilities and shareholders' equity	$ 407,395,431	$ 377,227,095

XML

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Investments available for sale:
Original or amortized cost	$ 170,781,535	$ 188,647,671
Equity securities, cost	42,769,116	43,954,737
Trading securities, cost	70,690	0
Liabilities:
Trading Securities, Proceeds	$ 181,160	$ 108,881
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)	3,354,711	3,699,447

XML

Condensed Consolidated Statements of Income (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues:
Premiums and policy fees	$ 2,996,420	$ 2,706,709	$ 8,812,151	$ 8,505,704
Ceded reinsurance premiums and policy fees	(740,340)	(825,134)	(2,244,538)	(2,382,376)
Net investment income	2,850,301	3,955,407	10,079,273	11,965,809
Other income	90,209	145,141	385,756	460,571
Revenues before realized gains	5,196,590	5,982,123	17,032,642	18,549,708
Realized investment gains (losses), net:
Other-than-temporary impairments	0	0	0	0
Other realized investment gains, net	1,855,576	3,305,835	5,923,373	7,732,155
Total realized investment gains, net	1,855,576	3,305,835	5,923,373	7,732,155
Total revenue	7,052,166	9,287,958	22,956,015	26,281,863
Benefits, claims and settlement expenses:
Life	5,024,528	5,484,256	16,407,007	15,357,486
Ceded Reinsurance benefits and claims	(511,137)	(1,447,479)	(2,017,207)	(2,569,732)
Annuity	260,264	263,198	887,840	793,432
Dividends to policyholders	93,053	92,660	342,287	344,258
Amortization of cost of insurance acquired	218,246	226,901	654,738	680,703
Commissions and amortization of deferred policy acquisition costs	(21,923)	(47,886)	(93,865)	(132,162)
Operating expenses	1,792,990	2,057,074	5,471,329	6,404,256
Interest expense	0	8,618	0	70,141
Total benefits and other expenses	6,856,021	6,637,342	21,652,129	20,948,382
Loss before income taxes	196,145	2,650,616	1,303,886	5,333,481
Income tax (expense) benefit	152,829	(731,082)	(339,658)	(1,545,975)
Net loss	348,974	1,919,534	964,228	3,787,506
Net income attributable to noncontrolling interests	(29,663)	(22,822)	(75,636)	(174,828)
Net loss attributable to common shareholders'	$ 319,311	$ 1,896,712	$ 888,592	$ 3,612,678
Amounts attributable to common shareholders':
Basic loss per share	$ 0.09	$ 0.51	$ 0.25	$ 0.97
Diluted loss per share	$ 0.09	$ 0.51	$ 0.25	$ 0.97
Basic weighted average shares outstanding	3,439,426	3,700,180	3,602,164	3,706,741
Diluted weighted average shares outstanding	3,439,426	3,700,180	3,602,164	3,706,741

XML

Condensed Consolidated Statement of Comprehensive Income (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Condensed Consolidated Statement of Comprehensive Income (Unaudited) [Abstract]
Net income (loss)	$ 348,974	$ 1,919,534	$ 964,228	$ 3,787,506
Other comprehensive income (loss):
Unrealized holding gains (losses) arising during period, pre-tax	7,196,483	(6,646,467)	38,064,491	(7,093,248)
Tax (expense) benefit on unrealized holding gains (losses) arising during the period	(2,518,769)	2,326,264	(13,322,572)	2,482,637
Unrealized holding gains (losses) arising during period, net of tax	4,677,714	(4,320,203)	24,741,919	(4,610,611)
Less reclassification adjustment for gains included in net income	(709,955)	(369,524)	(1,406,628)	(1,192,575)
Tax expense for gains included in net income	248,484	129,333	492,320	417,401
Reclassification adjustment for gains included in net income, net of tax	(461,471)	(240,191)	(914,308)	(775,174)
Subtotal: Other comprehensive income (loss), net of tax	4,216,243	(4,560,394)	23,827,611	(5,385,785)
Comprehensive income (loss)	4,565,217	(2,640,860)	24,791,839	(1,598,279)
Less comprehensive income attributable to noncontrolling interests	(29,663)	(22,822)	(75,636)	(174,828)
Comprehensive income (loss) attributable to UTG, Inc.	$ 4,535,554	$ (2,663,682)	$ 24,716,203	$ (1,773,107)

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Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities:
Net loss attributable to common shareholders	$ 888,592	$ 3,612,678
Adjustments to reconcile net loss to net cash used in operating activities
Amortization (accretion) of investments	(553,517)	(2,887,463)
Realized investment gains, net	(5,923,373)	(7,732,155)
Unrealized trading (gains) losses included in income	0	964,122
Realized trading (gains) losses included in income	0	0
Amortization of deferred policy acquisition costs	0	0
Amortization of cost of insurance acquired	654,738	680,703
Depreciation	500,538	609,600
Net income attributable to noncontrolling interest	75,636	174,828
Charges for mortality and administration of universal life and annuity products	(2,116,902)	(4,980,737)
Interest credited to account balances	3,466,719	3,680,292
Change in accrued investment income	(152,822)	9,882
Change in reinsurance receivables	(22,291)	(73,846)
Change in policy liabilities and accruals	(1,897,222)	(2,906,385)
Change in income taxes receivable (payable)	(796,159)	(1,199,276)
Change in other assets and liabilities, net	603,671	(4,399,062)
Net cash used in operating activities	(5,272,392)	(14,446,819)
Proceeds from investments sold and matured:
Fixed maturities available for sale	26,829,015	19,216,266
Equity securities available for sale	4,506,115	7,128,725
Trading securities	72,279	125,774
Mortgage loans	3,482,189	19,739,596
Discounted mortgage loans	0	0
Real estate	9,939,470	17,041,627
Proceeds from Sale of Notes Receivable	2,778,401	0
Policy loans	1,465,996	2,228,637
Short term investment	0	828,476
Total proceeds from investments sold and matured	49,073,465	66,309,101
Cost of investments acquired:
Fixed maturities available for sale	(7,919,941)	(16,641,310)
Equity securities available for sale	(2,475,777)	(9,531,330)
Trading securities	(70,690)	(463,895)
Mortgage loans	(6,922,723)	(11,297,550)
Discounted mortgage loans	0	0
Payments to Acquire Notes Receivable	(7,144,707)	0
Real estate	(11,937,317)	(6,395,223)
Policy loans	(1,018,958)	(1,933,945)
Short-term investments	0	(79,925)
Total cost of investments acquired	(37,490,113)	(46,343,178)
Sale of property and equipment	0	0
Net cash provided by investing activities	11,583,352	19,965,923
Cash flows from financing activities:
Proceeds From Policyholder Contract Deposits	407,633	3,977,725
Policyholder contract withdrawals	(3,434,052)	(4,159,165)
Proceeds from notes payable/line of credit	2,900,000	0
Payments of principal on notes payable/line of credit	0	(4,400,000)
Purchase of treasury stock	(5,049,971)	(150,336)
Non-controlling distributions of consolidated subsidiary	(123,016)	(539,337)
Sale of block of business	0	0
Net cash provided by (used in) financing activities	(5,299,406)	(5,271,113)
Net increase (decrease) in cash and cash equivalents	1,011,554	247,991
Cash and cash equivalents at beginning of period	11,822,615	13,977,443
Cash and cash equivalents at end of period	$ 12,834,169	$ 14,225,434

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BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2016

BASIS OF PRESENTATION [Abstract]

BASIS OF PRESENTATION

Note 1 – Basis of Presentation

The accompanying Condensed Consolidated Balance Sheet as of December 31, 2015, which has been derived from audited consolidated financial statements, and the unaudited interim Condensed Consolidated Financial Statements include the accounts of UTG, Inc. (the "Parent") and its subsidiaries (collectively with the Parent, the "Company").  All significant intercompany accounts and transactions have been eliminated in consolidation.  The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 8 of regulation S-X.  Accordingly, they do not include all of the information and notes required by GAAP for audited annual financial statements.  The information furnished includes all adjustments and accruals of a normal recurring nature, which in the opinion of Management, are necessary for a fair presentation of the results for the interim periods.  The unaudited Condensed Consolidated Financial Statements included herein and these related notes should be read in conjunction with the Company's consolidated financial statements, and the notes thereto, included in the Company's Annual Report on Form 10-K for the year ended December 31, 2015.  The Company's results of operations for the three and nine month periods ended  September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016 or for any other future period.

This document at times will refer to the Registrant's largest shareholder, Mr. Jesse T. Correll and certain companies controlled by Mr. Correll.  Mr. Correll holds a majority ownership of First Southern Funding, LLC ("FSF"), a Kentucky corporation, and First Southern Bancorp, Inc. ("FSBI"), a financial services holding company.  FSBI operates through its 100% owned subsidiary bank, First Southern National Bank ("FSNB").  Banking activities are conducted through multiple locations within south-central and western Kentucky.  Mr. Correll is Chief Executive Officer and Chairman of the Board of Directors of UTG and is currently UTG's largest shareholder through his ownership control of FSF, FSBI and affiliates.  At September 30, 2016, Mr. Correll owns or controls directly and indirectly approximately  63.65% of UTG's outstanding stock.

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

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NEW ACCOUNTING STANDARDS

9 Months Ended

Sep. 30, 2016

NEW ACCOUNTING STANDARDS [Abstract]

NEW ACCOUNTING STANDARDS

Note 2 – 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.

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INVESTMENTS

9 Months Ended

Sep. 30, 2016

INVESTMENTS [Abstract]

INVESTMENTS

Note 3 – Investments

Available for Sale Securities – Fixed Maturity and Equity Securities

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

Investments in available for sale securities are summarized as follows:

September 30, 2016		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	$	9,055,395	$	156,931	$	-	$	9,212,326
U.S. special revenue and assessments		10,144,111		1,259,164		-		11,403,275
Collateralized mortgage obligations		-		-		-		-
Public utilities		-		-		-		-
All other corporate bonds		151,582,029		20,831,255		(292,457)		172,120,827
		170,781,535		22,247,350		(292,457)		192,736,428
Equity securities		42,769,116		13,411,230		(629,726)		55,550,620
Total	$	213,550,651	$	35,658,580	$	(922,183)	$	248,287,048

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
States, municipalities and political subdivisions		-		-		-		-
U.S. special revenue and assessments		1,137,546		7,843		(2,550)		1,142,839
Collateralized mortgage obligations		-		-		-		-
Public utilities		-		-		-		-
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

The amortized cost and estimated market value of debt securities at September 30, 2016, by contractual maturity, is shown below.  Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Fixed Maturities Available for Sale September 30, 2016		Amortized Cost		Estimated Fair Value
Due in one year or less	$	1,730,616	$	1,824,054
Due after one year through five years		26,748,038		28,673,722
Due after five years through ten years		53,227,304		64,681,864
Due after ten years		88,767,630		97,556,788
Total	$	170,781,535	$	192,736,428

The fair value of investments with sustained gross unrealized losses at September 30, 2016 and December 31, 2015 are as follows:

September 30, 2016		Less than 12 months			12 months or longer			Total
		Fair value	Unrealized losses		Fair value	Unrealized losses		Fair value	Unrealized losses
All other corporate bonds		2,782,185	(37,793)		5,986,860	(254,664)		8,769,045	(292,457)
Total fixed maturities	$	2,782,185	(37,793)	$	5,986,860	(254,664)	$	8,769,045	(292,457)
Equity securities	$	4,419,011	(629,726)	$	-	-	$	4,419,011	(629,726)

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)	$	-	-	$	4,966,210	(32,083)
U.S. special revenue and assessments		984,770	(2,550)		-	-		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)	$	-	-	$	4,741,132	(388,602)

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

	Less than 12 months	12 months or longer	Total
As of September 30, 2016
Fixed maturities	3	4	7
Equity securities	3	-	3
As of December 31, 2015
Fixed maturities	40	9	49
Equity securities	9	-	9

Substantially all of the unrealized losses on fixed maturities available for sale and equity securities at  September 30, 2016 and December 31, 2015 are attributable to changes in market interest rates and general disruptions in the credit market subsequent to purchase.  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  September 30, 2016 and December 31, 2015.

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

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

Based on Management's review of the investment portfolio, the Company did not record any losses for other-than-temporary impairments in the Condensed Consolidated Statements of Operations for the nine-month period ended   September 30, 2016 and 2015.

Trading Securities

Securities designated as trading securities are reported at fair value, with gains or losses resulting from changes in fair value recognized in net investment income on the Condensed Consolidated Statements of Operations.  Trading securities include exchange-traded equities and exchange-traded options.  Trading securities carried as liabilities are securities sold short. A gain, limited to the price at which the security was sold short, or a loss, potentially unlimited in size, will be recognized upon the termination of the short sale.  The fair value of derivatives included in trading security assets and trading security liabilities as of   September 30, 2016 was $70,690 and $(100,887), respectively. 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.  Earnings from trading securities are classified in cash flows from operating activities. The derivatives held by the Company are for income generation purposes only.

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

		Three Months Ended
		September 30,
		2016		2015
Net unrealized gains (losses)	$	-	$	55,140
Net realized gains (losses)		-		-
Net unrealized and realized gains (losses)	$	-	$	55,140

		Nine Months Ended
		September 30,
		2016		2015
Net unrealized gains (losses)	$	-	$	(964,122)
Net realized gains (losses)		-		515,967
Net unrealized and realized gains (losses)	$	-	$	(448,155)

Mortgage Loans

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 23% and 30 % of the mortgage loan portfolio consists of discounted commercial mortgage loans as of September 30, 2016 and December 31, 2015, 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 2016 and 2015, the Company acquired $6.3 million and $13.8 million 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 2016 and 2015, the maximum and minimum lending rates for mortgage loans were:

	2016		2015
	Maximum rate	Minimum rate	Maximum rate	Minimum rate
Commercial Loans	8.50%	3.94%	8.00%	4.00%
Residential Loans	8.00%	3.00%	8.00%	3.00%

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  33.0% and 39.0% of face value as of September 30, 2016 and December 31, 2015, respectively.  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 September 30, 2016 and December 31, 2015.

The following table summarizes the number of loans held in the discounted mortgage loan portfolio and the carrying value of the loans:

September 30, 2016 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	6		5,095,738
Total	17	$	5,116,572

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:

		September 30, 2016		December 31, 2015
In good standing	$	19,910,147	$	14,701,228
Overdue interest over 90 days		20,834		20,834
Restructured		63,826		126,118
In process of foreclosure		2,132,864		2,921,750
Total mortgage loans	$	22,127,671	$	17,769,930
Total foreclosed loans during the year	$	735,000	$	-

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  September 30, 2016 and December 31, 2015 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. 

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FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2016

FAIR VALUE MEASUREMENTS [Abstract]

FAIR VALUE MEASUREMENTS

Note 4 – Fair Value Measurements

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

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

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

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

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

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

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

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

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

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

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

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

Securities designated as trading securities consist of 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 Condensed Consolidated Balance Sheet on a recurring basis as of September 30, 2016.

		Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	9,212,326	$	180,834,568	$	2,689,534	$	192,736,428
Equity Securities, available for sale		20,138,222		6,649,691		28,762,707		55,550,620
Trading Securities		70,690		0		0		70,690
Total	$	29,421,238	$	187,484,259	$	31,452,241	$	248,357,738
Liabilities
Trading Securities	$	100,887	$	-	$	-	$	100,887

The following table presents the Company's assets and liabilities measured at fair value in the Condensed Consolidated Balance Sheet on a recurring basis as of December 31, 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	$	-	$	-	$	28,609

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, 2015	$	1,026,694	$	26,805,948	$	27,832,642
Total unrealized gains (losses):
Included in realized gains (losses)		94,549		-		94,549
Included in other comprehensive income		1,700,626		2,173,151		3,873,777
Purchases		-		980,758		980,758
Sales		(132,335)		(1,197,150)		(1,329,485)
Balance at September 30, 2016	$	2,689,534	$	28,762,707	$	31,452,241

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 September 30, 2016.  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.

		September 30, 2016				December 31, 2015
Assets		Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Mortgage loans on real estate	$	22,127,671	$	22,127,671	$	17,769,930	$	17,775,178
Investment real estate		52,831,706		52,831,706		47,650,102		47,650,102
Notes receivable		14,964,213		14,964,213		10,597,907		10,597,907
Policy loans		10,237,206		10,237,206		10,684,244		10,684,244
Cash and cash equivalents		12,834,169		12,834,169		11,822,615		11,822,615

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 Condensed 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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CREDIT ARRANGEMENTS

9 Months Ended

Sep. 30, 2016

CREDIT ARRANGEMENTS [Abstract]

CREDIT ARRANGEMENTS

Note 5 – Credit Arrangements

At September 30, 2016 and December 31, 2015, the Company had the following outstanding debt:

				Outstanding Principal Balance
Instrument	Issue Date	Maturity Date		September 30, 2016		December 31, 2015
Promissory Note:
SoftVest, LP	7/22/2016	7/22/2018	$	1,450,000	$	0
SoftSearch, L.P.	7/22/2016	7/22/2018	$	1,450,000	$	0

Instrument	Issue Date	Maturity Date		Revolving Credit Limit		December 31, 2015	Borrowings	Repayments		September 30, 2016
Lines of Credit:
UTG	2013-11-20	2016-11-20	$	8,000,000	$	-	-	-	$	-
UG	2015-06-02	2017-05-10		10,000,000		-	-	-		-

The UTG line of credit carries interest at a fixed rate of  3.75% and is payable monthly. As collateral, UTG has pledged 100% of the common voting stock of its wholly owned subsidiary, Universal Guaranty Life Insurance Company ("UG").  The Company is currently in the process of renewing this line of credit.

During May of 2016, 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.

On July 22, 2016, the Company entered in to an agreement to acquire 300,000 shares of its outstanding common stock from a shareholder that owned approximately 8 % of the Company's outstanding common stock.  The acquisition was made under the Company's stock buy-back program. As part of this transaction, two promissory notes totaling $2.9 million were issued. The notes require principal payments of one half of the note value to be paid one year from the date of purchase and the other one half to be paid two years from the date of purchase. The notes bear interest at 0%.

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SHAREHOLDERS' EQUITY

9 Months Ended

Sep. 30, 2016

SHAREHOLDERS' EQUITY [Abstract]

CAPITAL STOCK TRANSACTIONS

Note 6 – Shareholders' Equity

Stock Repurchase Programs

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 15, 2016, the Board of Directors of UTG authorized the repurchase of up to an additional $2 million of UTG's common stock and on July 14, 2016, the Board of Directors again increased the amount available by an additional $4.5 million, for a total repurchase of $14.5 million. Repurchased shares are available for future issuance for general corporate purposes. Company Management has broad authority to operate the program, including the discretion of whether to purchase shares and the ability to suspend or terminate the program. Open market purchases are made based on the last available market price but may be limited.  During the nine month period ended September

30, 2016, the Company repurchased approximately $364,000shares through the stock repurchase program for approximately $5,297,000. Through September 30, 2016, UTG has spent approximately $11.8 million in the acquisition of approximately 1,050,000shares under this program.

As mentioned in Note 5 above, on July 22, 2016 the Company entered in to an agreement to acquire 300,000 shares of its outstanding common stock from a shareholder that owned approximately 8 % of the Company's outstanding common stock. The purchase price per share was $14.50 and was paid with cash and was derived through private negotiation. The purchase was paid with cash and the issuance of promissory notes.

Earnings Per Share Calculations

Earnings per share are based on the weighted average number of common shares outstanding during each period.  For the three and nine months period ended September 30, 2016 and 2015, diluted earnings per share were the same as basic earnings per share since the Company had no dilutive instruments outstanding.

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COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2016

COMMITMENTS AND CONTINGENCIES [Abstract]

COMMITMENTS AND CONTINGENCIES

Note 7 – Commitments and Contingencies

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

Under the insurance guaranty fund laws in most states, insurance companies doing business in a participating state can be assessed up to prescribed limits for policyholder losses incurred by insolvent or failed insurance companies.  Although the Company cannot predict the amount of any future assessments, most insurance guaranty fund laws currently provide that an assessment may be excused or deferred if it would threaten an insurer's financial strength.  Mandatory assessments may be partially recovered through a reduction in future premium tax in some states. The Company does not believe such assessments will be materially different from amounts already provided for in the condensed consolidated 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 September 30, 2016 related to certain investments:

		Total Funding		Unfunded
		Commitment		Commitment
RLF III, LLC	$	4,000,000	$	398,120
Sovereign's Capital, LP Fund I		500,000		56,142
UGLIC, LLC		1,600,000		120,000
Sovereign's Capital, LP Fund II		1,000,000		730,000
Barton Springs Music, LLC		2,500,000		1,668,100
Master Mineral Holdings II, LP		4,122,167		2,315,786
PBEX II, LLC		5,000,000		527,157

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 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.

During 2016, the Company made a commitment to invest in Barton Springs Music, LLC ("Barton"), which invests in music royalties.  Barton makes capital calls to its investors as funds are needed to acquire the royalty rights.

During 2016, the Company made a commitment to invest in Master Mineral Holdings II, LP ("MMH"), which purchases land for leasing opportunities to those looking to harvest natural resources.  MMH makes capital calls to its investors as funds are needed for continued land purchases.

During 2016, the Company made a commitment to invest in PBEX II, LLC ("PBEX"), which purchases land for leasing opportunities to those looking to harvest natural resources.  PBEX makes capital calls to its investors as funds are needed for continued land purchases.

Note 8 – Other Cash Flow Disclosures

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OTHER CASH FLOW DISCLOSURES

9 Months Ended

Sep. 30, 2016

OTHER CASH FLOW DISCLOSURES [Abstract]

OTHER CASH FLOW DISCLOSURES

		Three Months Ended
		September 30,
		2016		2015
Interest	$	-	$	70,141
Federal income tax		33,000		-

		Nine Months Ended
		September 30,
		2016		2015
Interest	$	-	$	-
Federal income tax		768,000		3,000,000

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CONCENTRATIONS

9 Months Ended

Sep. 30, 2016

CONCENTRATIONS [Abstract]

CONCENTRATIONS

Note 9 – Concentrations of Credit Risk

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

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NEW ACCOUNTING STANDARDS (Policies)

9 Months Ended

Sep. 30, 2016

NEW ACCOUNTING STANDARDS [Abstract]

New Accounting Pronouncements, Policy [Policy Text Block]

Note 2 – 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.

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INVESTMENTS (Tables)

9 Months Ended

Sep. 30, 2016

INVESTMENTS [Abstract]

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

Investments in available for sale securities are summarized as follows:

September 30, 2016		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	$	9,055,395	$	156,931	$	-	$	9,212,326
U.S. special revenue and assessments		10,144,111		1,259,164		-		11,403,275
Collateralized mortgage obligations		-		-		-		-
Public utilities		-		-		-		-
All other corporate bonds		151,582,029		20,831,255		(292,457)		172,120,827
		170,781,535		22,247,350		(292,457)		192,736,428
Equity securities		42,769,116		13,411,230		(629,726)		55,550,620
Total	$	213,550,651	$	35,658,580	$	(922,183)	$	248,287,048

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
States, municipalities and political subdivisions		-		-		-		-
U.S. special revenue and assessments		1,137,546		7,843		(2,550)		1,142,839
Collateralized mortgage obligations		-		-		-		-
Public utilities		-		-		-		-
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

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

The amortized cost and estimated market value of debt securities at September 30, 2016, by contractual maturity, is shown below.  Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Fixed Maturities Available for Sale September 30, 2016		Amortized Cost		Estimated Fair Value
Due in one year or less	$	1,730,616	$	1,824,054
Due after one year through five years		26,748,038		28,673,722
Due after five years through ten years		53,227,304		64,681,864
Due after ten years		88,767,630		97,556,788
Total	$	170,781,535	$	192,736,428

Fair value of investments with sustained gross unrealized losses

The fair value of investments with sustained gross unrealized losses at September 30, 2016 and December 31, 2015 are as follows:

September 30, 2016		Less than 12 months			12 months or longer			Total
		Fair value	Unrealized losses		Fair value	Unrealized losses		Fair value	Unrealized losses
All other corporate bonds		2,782,185	(37,793)		5,986,860	(254,664)		8,769,045	(292,457)
Total fixed maturities	$	2,782,185	(37,793)	$	5,986,860	(254,664)	$	8,769,045	(292,457)
Equity securities	$	4,419,011	(629,726)	$	-	-	$	4,419,011	(629,726)

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)	$	-	-	$	4,966,210	(32,083)
U.S. special revenue and assessments		984,770	(2,550)		-	-		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)	$	-	-	$	4,741,132	(388,602)

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

	Less than 12 months	12 months or longer	Total
As of September 30, 2016
Fixed maturities	3	4	7
Equity securities	3	-	3
As of December 31, 2015
Fixed maturities	40	9	49
Equity securities	9	-	9

Trading revenue charged to investment

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

		Three Months Ended
		September 30,
		2016		2015
Net unrealized gains (losses)	$	-	$	55,140
Net realized gains (losses)		-		-
Net unrealized and realized gains (losses)	$	-	$	55,140

		Nine Months Ended
		September 30,
		2016		2015
Net unrealized gains (losses)	$	-	$	(964,122)
Net realized gains (losses)		-		515,967
Net unrealized and realized gains (losses)	$	-	$	(448,155)

Maximum and minimum lending rates for mortgage loans

During 2016 and 2015, the maximum and minimum lending rates for mortgage loans were:

	2016		2015
	Maximum rate	Minimum rate	Maximum rate	Minimum rate
Commercial Loans	8.50%	3.94%	8.00%	4.00%
Residential Loans	8.00%	3.00%	8.00%	3.00%

Summary of number and carrying value of loans held in discounted mortgage loan portfolio

The following table summarizes the number of loans held in the discounted mortgage loan portfolio and the carrying value of the loans:

September 30, 2016 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	6		5,095,738
Total	17	$	5,116,572

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

Summary of mortgage loan holdings

The following table summarizes the mortgage loan holdings of the Company:

		September 30, 2016		December 31, 2015
In good standing	$	19,910,147	$	14,701,228
Overdue interest over 90 days		20,834		20,834
Restructured		63,826		126,118
In process of foreclosure		2,132,864		2,921,750
Total mortgage loans	$	22,127,671	$	17,769,930
Total foreclosed loans during the year	$	735,000	$	-

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FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2016

FAIR VALUE MEASUREMENTS [Abstract]

Financial assets and liabilities measured on recurring basis

The following table presents the Company's assets and liabilities measured at fair value in the Condensed Consolidated Balance Sheet on a recurring basis as of September 30, 2016.

		Level 1		Level 2		Level 3		Total
Assets
Fixed Maturities, available for sale	$	9,212,326	$	180,834,568	$	2,689,534	$	192,736,428
Equity Securities, available for sale		20,138,222		6,649,691		28,762,707		55,550,620
Trading Securities		70,690		0		0		70,690
Total	$	29,421,238	$	187,484,259	$	31,452,241	$	248,357,738
Liabilities
Trading Securities	$	100,887	$	-	$	-	$	100,887

The following table presents the Company's assets and liabilities measured at fair value in the Condensed Consolidated Balance Sheet on a recurring basis as of December 31, 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	$	-	$	-	$	28,609

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, 2015	$	1,026,694	$	26,805,948	$	27,832,642
Total unrealized gains (losses):
Included in realized gains (losses)		94,549		-		94,549
Included in other comprehensive income		1,700,626		2,173,151		3,873,777
Purchases		-		980,758		980,758
Sales		(132,335)		(1,197,150)		(1,329,485)
Balance at September 30, 2016	$	2,689,534	$	28,762,707	$	31,452,241

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

		September 30, 2016				December 31, 2015
Assets		Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Mortgage loans on real estate	$	22,127,671	$	22,127,671	$	17,769,930	$	17,775,178
Investment real estate		52,831,706		52,831,706		47,650,102		47,650,102
Notes receivable		14,964,213		14,964,213		10,597,907		10,597,907
Policy loans		10,237,206		10,237,206		10,684,244		10,684,244
Cash and cash equivalents		12,834,169		12,834,169		11,822,615		11,822,615

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CREDIT ARRANGEMENTS (Tables)

9 Months Ended

Sep. 30, 2016

CREDIT ARRANGEMENTS [Abstract]

Schedule of lines of credit

Instrument	Issue Date	Maturity Date		Revolving Credit Limit		December 31, 2015	Borrowings	Repayments		September 30, 2016
Lines of Credit:
UTG	2013-11-20	2016-11-20	$	8,000,000	$	-	-	-	$	-
UG	2015-06-02	2017-05-10		10,000,000		-	-	-		-

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COMMITMENTS AND CONTINGENCIES (Tables)

9 Months Ended

Sep. 30, 2016

COMMITMENTS AND CONTINGENCIES [Abstract]

Funding commitment and unfunded commitment

The following table represents the total funding commitments and the unfunded commitment as of September 30, 2016 related to certain investments:

		Total Funding		Unfunded
		Commitment		Commitment
RLF III, LLC	$	4,000,000	$	398,120
Sovereign's Capital, LP Fund I		500,000		56,142
UGLIC, LLC		1,600,000		120,000
Sovereign's Capital, LP Fund II		1,000,000		730,000
Barton Springs Music, LLC		2,500,000		1,668,100
Master Mineral Holdings II, LP		4,122,167		2,315,786
PBEX II, LLC		5,000,000		527,157

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OTHER CASH FLOW DISCLOSURES (Tables)

9 Months Ended

Sep. 30, 2016

OTHER CASH FLOW DISCLOSURES [Abstract]

Expenses paid on a cash basis

		Three Months Ended
		September 30,
		2016		2015
Interest	$	-	$	70,141
Federal income tax		33,000		-

		Nine Months Ended
		September 30,
		2016		2015
Interest	$	-	$	-
Federal income tax		768,000		3,000,000

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BASIS OF PRESENTATION (Details)	9 Months Ended
	Sep. 30, 2016
Subsidiary or Equity Method Investee [Line Items]
Ownership in subsidiary bank (in hundredths)	100.00%
Related Party Disclosure [Line Items]
Ownership or control of outstanding common stock directly or indirectly (in hundredths)	63.65%

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INVESTMENTS (Details)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2016 USD ($) Security Loans	Sep. 30, 2015 USD ($)	Sep. 30, 2016 USD ($) Security Loans	Sep. 30, 2015 USD ($)	Dec. 31, 2015 USD ($) Security Loans	Jun. 30, 2016 USD ($)	Jun. 30, 2015
Fixed maturities [Abstract]
Original or amortized cost	$ 170,781,535		$ 170,781,535		$ 188,647,671
Gross unrealized gains	22,247,350		22,247,350		5,211,889
Gross unrealized losses	(292,457)		(292,457)		(8,740,463)
Estimated fair value	192,736,428		192,736,428		185,119,097
Equity securities [Abstract]
Original or amortized cost	42,769,116		42,769,116		43,954,737
Gross unrealized gains	13,411,230		13,411,230		2,119,205
Gross unrealized losses	(629,726)		(629,726)		(388,602)
Estimated fair value	55,550,620		55,550,620		45,685,340
Total [Abstract]
Original or amortized cost	213,550,651		213,550,651		232,602,408
Gross unrealized gains	35,658,580		35,658,580		7,331,094
Gross unrealized losses	(922,183)		(922,183)		(9,129,065)
Estimated fair value	248,287,048		248,287,048		230,804,437
Amortized cost of debt securities, by contractual maturity [Abstract]
Due in one year or less	1,730,616		1,730,616
Due after one year through five years	26,748,038		26,748,038
Due after five years through ten years	53,227,304		53,227,304
Due after ten years	88,767,630		88,767,630
Original or amortized cost	170,781,535		170,781,535		188,647,671
Estimated fair value of debt securities, by contractual maturity [Abstract]
Due in one year or less	1,824,054		1,824,054
Due after one year through five years	28,673,722		28,673,722
Due after five years through ten years	64,681,864		64,681,864
Due after ten years	97,556,788		97,556,788
Estimated fair value	192,736,428		192,736,428		185,119,097
Trading Securities [Abstract]
Fair value, derivatives included in trading security assets	70,690		70,690		0
Fair value, derivative included in trading security liabilities	(100,887)		(100,887)		$ (28,609)
trading transfer to available for sale securities	0		0			$ 0
Trading securities, net unrealized gain (loss)	0	$ 55,140	0	$ (964,122)
Trading securities, realized gain (loss)	0	0	0	515,967
Increase (Decrease) in Trading Securities [Abstract]
Net Realized and Unrealized Gain (Loss) on Trading Securities	$ 0	$ 55,140	$ 0	$ (448,155)
Mortgages [Abstract]
Number of Mortgage Loans including Discounted Mortgage Loans	23.00%		23.00%		30.00%
Mortgage Loans including Discounted Mortgage Loans	$ 6.3		$ 6.3		$ 13.8
Servicing Fee on Loan Percent			0.25%	0.25%
Loan Origination Percent			0.50%	0.50%
Average purchase price to outstanding loan (in hundredths)	33.00%	39.00%
Commercial loans maximum rate	8.50%		8.50%				8.00%
Commercial loans minimum rate	3.94%		3.94%				4.00%
Residential loans maximum rate	8.00%		8.00%				8.00%
Residential loans minimum rate	3.00%		3.00%				3.00%
Loan limit threshold for appraised property value	80.00%	80.00%
Mortgage loans reserve	$ 0	$ 0	$ 0	$ 0
Discounted mortgage loan portfolio payment performance [Abstract]
Number of discounted loans with no payments	8		8		8
Number of discounted loans one time payment received | Loans	1		1		1
Number of discounted loans irregular payments received | Loans	2		2		2
Number of discounted loans periodic payments received | Loans	6		6		7
Number of discounted loans | Loans	17		17		18
Discounted loans with no payments | Loans	0		0		0
Discounted loans with one time payment received	$ 0		$ 0		$ 0
Discounted loans with irregular payments received	20,834		20,834		20,834
Discounted loans with periodic payments received	5,095,738		5,095,738		5,347,215
Discounted loans	5,116,572		5,116,572		5,368,049
Discounted mortgage loan holdings [Abstract]
In good standing	19,910,147		19,910,147		14,701,228
Overdue interest over 90 days	20,834		20,834		20,834
Restructured	63,826				126,118
In process of foreclosure	2,132,864		2,132,864		2,921,750
Total discounted mortgage loans	22,127,671		22,127,671		17,769,930
Total foreclosed discounted mortgage loans	735,000				0
Notes Receivable [Abstract]
Valuation allowance	0	0	0	0
U.S. Government and Government Agencies and Authorities [Member]
Fixed maturities [Abstract]
Original or amortized cost	9,055,395		9,055,395		20,336,681
Gross unrealized gains	156,931		156,931		1,441,890
Gross unrealized losses	0		0		(32,083)
Estimated fair value	9,212,326		9,212,326		21,746,488
Amortized cost of debt securities, by contractual maturity [Abstract]
Original or amortized cost	9,055,395		9,055,395		20,336,681
Estimated fair value of debt securities, by contractual maturity [Abstract]
Estimated fair value	9,212,326		9,212,326		21,746,488
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, fair value	0		0		4,966,210
Less than 12 months, unrealized losses			0	(32,083)
Twelve months or longer, fair value	0		0		0
Twelve months or longer, unrealized losses		0	0
Total fair value	0		0		4,966,210
Total unrealized losses			0	(32,083)
US Special Revenue and Assessments [Member]
Fixed maturities [Abstract]
Original or amortized cost	10,144,111		10,144,111		1,137,546
Gross unrealized gains	1,259,164		1,259,164		7,843
Gross unrealized losses	0		0		(2,550)
Estimated fair value	11,403,275		11,403,275		1,142,839
Amortized cost of debt securities, by contractual maturity [Abstract]
Original or amortized cost	10,144,111		10,144,111		1,137,546
Estimated fair value of debt securities, by contractual maturity [Abstract]
Estimated fair value	11,403,275		11,403,275		1,142,839
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, fair value	0		0		984,770
Less than 12 months, unrealized losses			0	(2,550)
Twelve months or longer, fair value	0		0		0
Twelve months or longer, unrealized losses		0	0
Total fair value	0		0		984,770
Total unrealized losses			0	(2,550)
States, Municipalities and Political Subdivisions [Member]
Fixed maturities [Abstract]
Original or amortized cost	0		0		0
Gross unrealized gains	0		0		0
Gross unrealized losses	0		0		0
Estimated fair value	0		0		0
Amortized cost of debt securities, by contractual maturity [Abstract]
Original or amortized cost	0		0		0
Estimated fair value of debt securities, by contractual maturity [Abstract]
Estimated fair value	0		0		0
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, fair value					0
Less than 12 months, unrealized losses				0
Twelve months or longer, fair value					0
Twelve months or longer, unrealized losses		0
Total fair value					0
Total unrealized losses		$ 0
Collateralized Mortgage Obligations [Member]
Fixed maturities [Abstract]
Original or amortized cost	0		0		0
Gross unrealized gains	0		0		0
Gross unrealized losses	0		0		0
Estimated fair value	0		0		0
Amortized cost of debt securities, by contractual maturity [Abstract]
Original or amortized cost	0		0		0
Estimated fair value of debt securities, by contractual maturity [Abstract]
Estimated fair value	0		0		0
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, fair value	0		0		0
Less than 12 months, unrealized losses			0	0
Twelve months or longer, fair value	0		0		0
Twelve months or longer, unrealized losses			0	0
Total fair value	0		0		0
Total unrealized losses			0	0
Public Utilities [Member]
Fixed maturities [Abstract]
Original or amortized cost	0		0		0
Gross unrealized gains	0		0		0
Gross unrealized losses	0		0		0
Estimated fair value	0		0		0
Amortized cost of debt securities, by contractual maturity [Abstract]
Original or amortized cost	0		0		0
Estimated fair value of debt securities, by contractual maturity [Abstract]
Estimated fair value	0		0		0
Debt Securities [Member]
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, fair value	2,782,185		2,782,185		91,685,077
Less than 12 months, unrealized losses			(37,793)	(5,289,909)
Twelve months or longer, fair value	5,986,860		5,986,860		19,400,640
Twelve months or longer, unrealized losses			(254,664)	(3,450,554)
Total fair value	$ 8,769,045		8,769,045		$ 111,085,717
Total unrealized losses			$ (292,457)	(8,740,463)
Less than 12 months, number of securities | Security	3		3		40
Twelve months or longer, number of securities | Security	4		4		9
Total number of securities | Security	7		7		49
Equity Securities [Member]
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, fair value	$ 4,419,011		$ 4,419,011		$ 4,741,132
Less than 12 months, unrealized losses			(629,726)	(388,602)
Twelve months or longer, fair value	0		0		0
Twelve months or longer, unrealized losses			0	0
Total fair value	$ 4,419,011		4,419,011		$ 4,741,132
Total unrealized losses			$ (629,726)	(388,602)
Less than 12 months, number of securities | Security	3		3		9
Twelve months or longer, number of securities | Security	0		0		0
Total number of securities | Security	3		3		9
All Other Corporate Bonds [Member]
Fixed maturities [Abstract]
Original or amortized cost	$ 151,582,029		$ 151,582,029		$ 167,173,444
Gross unrealized gains	20,831,255		20,831,255		3,762,156
Gross unrealized losses	(292,457)		(292,457)		(8,705,830)
Estimated fair value	172,120,827		172,120,827		162,229,770
Amortized cost of debt securities, by contractual maturity [Abstract]
Original or amortized cost	151,582,029		151,582,029		167,173,444
Estimated fair value of debt securities, by contractual maturity [Abstract]
Estimated fair value	172,120,827		172,120,827		162,229,770
Available-for-sale Securities, Continuous Unrealized Loss Position [Abstract]
Less than 12 months, fair value	2,782,185		2,782,185		85,734,097
Less than 12 months, unrealized losses			(37,793)	(5,255,276)
Twelve months or longer, fair value	5,986,860		5,986,860		19,400,640
Twelve months or longer, unrealized losses			(254,664)	(3,450,554)
Total fair value	$ 8,769,045		8,769,045		$ 105,134,737
Total unrealized losses			$ (292,457)	$ (8,705,830)

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FAIR VALUE MEASUREMENTS (Details) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2016	Dec. 31, 2015	Sep. 30, 2015	Dec. 31, 2014
Carrying Amount [Member]
Assets [Abstract]
Mortgage loans on real estate	$ 22,127,671	$ 22,127,671	$ 17,769,930
Discounted mortgage loans	0	0	0
Investment real estate	52,831,706	52,831,706	47,650,102
Policy Loans	10,237,206	10,237,206	10,684,244
Notes receivable	14,964,213	14,964,213	10,597,907
Cash and cash equivalents	12,834,169	12,834,169	11,822,615
Liabilities [Abstract]
Notes payable	0	0	0
Estimated Fair Value [Member]
Assets [Abstract]
Mortgage loans on real estate	22,127,671	22,127,671	17,775,178
Discounted mortgage loans	0	0	0
Investment real estate	52,831,706	52,831,706	47,650,102
Policy Loans	10,237,206	10,237,206	10,684,244
Notes receivable	14,964,213	14,964,213	10,597,907
Cash and cash equivalents	12,834,169	12,834,169	11,822,615
Liabilities [Abstract]
Notes payable	0	0	0
Fixed Maturities, available for sale	192,736,428	192,736,428	185,119,097
Trading Securities	70,690	70,690	0
Trading Securities	100,887	100,887	28,609
Beginning Balance		27,832,642
Included in realized gains/(losses)	94,549
Included in other comprehensive income	3,873,777
Purchases	980,758
Sales		(1,329,485)
Ending Balance	31,452,241	31,452,241
Discounted mortgage loans	0	0	0
Investment real estate	52,831,706	52,831,706	47,650,102
Notes receivable	14,964,213	14,964,213	10,597,907
Cash and cash equivalents	$ 12,834,169	$ 12,834,169	11,822,615	$ 14,225,434	$ 13,977,443
Minimum [Member]
Liabilities [Abstract]
Policy loan interest rate	4.00%	4.00%
Maximum [Member]
Liabilities [Abstract]
Policy loan interest rate	8.00%	8.00%
Measured on a recurring basis [Member]
Assets [Abstract]
Fixed Maturities, available for sale	$ 192,736,428	$ 192,736,428	185,119,097
Equity Securities, available for sale	55,550,620	55,550,620	45,685,340
Trading Securities	70,690	70,690	0
Total Financial Assets	248,357,738	248,357,738	230,804,437
Liabilities [Abstract]
Trading Securities	100,887	100,887	28,609
Measured on a recurring basis [Member] | Level 1 [Member]
Assets [Abstract]
Fixed Maturities, available for sale	9,212,326	9,212,326	10,459,758
Equity Securities, available for sale	20,138,222	20,138,222	13,312,331
Trading Securities	70,690	70,690	0
Total Financial Assets	29,421,238	29,421,238	23,772,089
Liabilities [Abstract]
Trading Securities	100,887	100,887	28,609
Measured on a recurring basis [Member] | Level 2 [Member]
Assets [Abstract]
Fixed Maturities, available for sale	180,834,568	180,834,568	173,632,645
Equity Securities, available for sale	6,649,691	6,649,691	5,567,061
Trading Securities	0	0	0
Total Financial Assets	187,484,259	187,484,259	179,199,706
Liabilities [Abstract]
Trading Securities	0	0	0
Measured on a recurring basis [Member] | Level 3 [Member]
Assets [Abstract]
Fixed Maturities, available for sale	2,689,534	2,689,534	1,026,694
Equity Securities, available for sale	28,762,707	28,762,707	26,805,948
Trading Securities	0	0	0
Total Financial Assets	31,452,241	31,452,241	27,832,642
Liabilities [Abstract]
Trading Securities	0	0	$ 0
Fixed Maturities [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance		1,026,694
Total unrealized gain or (losses) [Abstract]
Included in realized gains/(losses)	94,549
Included in other comprehensive income	1,700,626
Purchases	0
Sales		(132,335)
Ending Balance	2,689,534	2,689,534
Equity Securities [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance		26,805,948
Total unrealized gain or (losses) [Abstract]
Included in realized gains/(losses)	0
Included in other comprehensive income	2,173,151
Purchases	980,758
Sales		(1,197,150)
Ending Balance	$ 28,762,707	$ 28,762,707

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CREDIT ARRANGEMENTS (Details) - USD ($)		9 Months Ended
	Jul. 22, 2016	Sep. 30, 2016	Dec. 31, 2015
Scheduled principal reductions on notes payable for the next five years [Abstract]
2013		$ 0
2014		0
2015		0
2016		0
2017		$ 0
STOCK REPURCHASE PROGRAM [Abstract]
Treasury Stock, Shares, Acquired	300,000	364,000
% of shares owned by shareholder	8.00%
Amount paid to repurchase shares during the year	$ 2,900,000	$ 5,297,000
HPG Acquisition 2007-02-07 [Member]
Debt Instrument [Line Items]
Issue Date		Jul. 22, 2016
Maturity Date		Jul. 22, 2018
Outstanding Principal Balance		$ 1,450,000	$ 0
HPG Acquisitions 2012-12-27 [Member]
Debt Instrument [Line Items]
Issue Date		Jul. 22, 2016
Maturity Date		Jul. 22, 2018
Outstanding Principal Balance		$ 1,450,000	0
UTG 2012-11-20 [Member]
Lines of Credit [Line Items]
Issue Date		Nov. 20, 2013
Maturity Date		Nov. 20, 2016
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 10, 2017
Revolving Credit Limit		$ 10,000,000
Outstanding Balance		0	$ 0
Borrowings		0
Repayments		$ 0

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SHAREHOLDERS' EQUITY (Details) - USD ($)		6 Months Ended	9 Months Ended
	Jul. 22, 2016	Jun. 30, 2016	Sep. 30, 2016	Jul. 14, 2016	Jun. 15, 2016	Jun. 30, 2015
STOCK REPURCHASE PROGRAM [Abstract]
Stock repurchase program authorized amount				$ 4,500,000	$ 2	$ 14,500,000
Treasury Stock, Shares, Acquired	300,000		364,000
Amount paid to repurchase shares during the year	$ 2,900,000		$ 5,297,000
Amount of common stock repurchased		$ 11,800,000
Number of common stock acquired (in shares)		1,050,000
% of shares owned by shareholder	8.00%
Price paid per share	$ 14.50

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COMMITMENTS AND CONTINGENCIES (Details) - 9 months ended Sep. 30, 2016 - USD ($)	Total	Total
Liability for contingent costs [Line Items]
Litigation Settlement, Amount	$ 0
Investment Commitment [Line Items]
Total Funding Commitment		$ 0
Unfunded Commitment		0
ACAP [Member]
Liability for contingent costs [Line Items]
Loss Contingency Accrual, Ending Balance	0
Loss Contingency	$ 0	0
RLF III, LLC [Member]
Investment Commitment [Line Items]
Total Funding Commitment		4,000,000
Unfunded Commitment		398,120
Barton Springs Music, LLC [Member]
Investment Commitment [Line Items]
Total Funding Commitment		2,500,000
Unfunded Commitment		1,668,100
Marcellus HBPI, LLP [Member]
Investment Commitment [Line Items]
Total Funding Commitment		0
Unfunded Commitment		0
Sovereign's Capital, LP Fund I [Member]
Investment Commitment [Line Items]
Total Funding Commitment		500,000
Unfunded Commitment		56,142
Sovereign's Capital LP Fund II [Member]
Investment Commitment [Line Items]
Total Funding Commitment		1,000,000
Unfunded Commitment		730,000
MM-Appalachia IV, LP [Member]
Investment Commitment [Line Items]
Total Funding Commitment		0
Unfunded Commitment		0
UGLIC, LLC [Member]
Investment Commitment [Line Items]
Total Funding Commitment		1,600,000
Unfunded Commitment		120,000
PBEX II, LLC [Member]
Investment Commitment [Line Items]
Total Funding Commitment		5,000,000
Unfunded Commitment		527,157
Master Mineral Holdings II, LP [Member]
Investment Commitment [Line Items]
Total Funding Commitment		4,122,167
Unfunded Commitment		$ 2,315,786

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OTHER CASH FLOW DISCLOSURES (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
OTHER CASH FLOW DISCLOSURES [Abstract]
Interest expense paid	$ 0	$ 70,141	$ 0	$ 0
Federal income tax	33,000	$ 0	768,000	$ 3,000,000
Noncash transaction LOC	0		0
Cash to purchaser			0
Approximate future policyholder benefits			0
Approximate cost of insurance acquired	0
Noncash transaction short term investments	0		0
Noncash transaction real estate	$ 0		$ 0