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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2019
Income Tax Disclosure [Abstract] |
Provision for Income Tax | Our provision for income tax expense (benefit) for 2019, 2018 and 2017 consisted of the following:
|  | 2019 |  |  | 2018 |  |  | 2017 |
Current federal income tax |  | $ | 8,454,358 |  |  | $ | (11,296,704 | ) |  | $ | (2,139,061 | )
Deferred federal income tax |  |  | 649,928 |  |  |  | (4,179,805 | ) |  |  | 7,137,423 |
Federal income tax expense (benefit) |  | $ | 9,104,286 |  |  | $ | (15,476,509 | ) |  | $ | 4,998,362 |
Pennsylvania income tax |  |  | 825,000 |  |  |  | — |  |  |  | — |
Income tax expense (benefit) |  | $ | 9,929,286 |  |  | $ | (15,476,509 | ) |  | $ | 4,998,362 |
Reconciliation of Federal Income Tax Rate | The reasons for such difference and the related tax effects are as follows:
|  | 2019 |  |  | 201 8 |  |  | 201 7 |
Income (loss) before income taxes |  | $ | 57,081,030 |  |  | $ | (48,236,849 | ) |  | $ | 12,114,462 |
Computed “expected” taxes |  |  | 11,987,016 |  |  |  | (10,129,738 | ) |  |  | 4,240,062 |
Tax-exempt interest |  |  | (1,325,197 | ) |  |  | (1,521,090 | ) |  |  | (3,241,530 | )
Proration |  |  | 357,044 |  |  |  | 405,204 |  |  |  | 518,948 |
Effect of tax reform |  |  | — |  |  |  | — |  |  |  | 4,752,547 |
Dividends received deduction |  |  | (1,913,238 | ) |  |  | (99,726 | ) |  |  | (508,409 | )
Net operating loss carryback |  |  | — |  |  |  | (4,210,523 | ) |  |  | — |
Tax benefit on exercise of options |  |  | (64,765 | ) |  |  | (25,938 | ) |  |  | (873,515 | )
Other, net |  |  | 236,676 |  |  |  | 105,302 |  |  |  | 110,259 |
Pennsylvania income tax, net of federal benefit |  |  | 651,750 |  |  |  | — |  |  |  | — |
Income tax expense (benefit) |  | $ | 9,929,286 |  |  | $ | (15,476,509 | ) |  | $ | 4,998,362 |
Schedule of Deferred Tax Assets and Deferred Tax Liabilities | The tax effects of temporary differences that give rise to significant portions of our deferred tax assets and deferred tax liabilities at December 31, 2019 and 2018 are as follows:
|  | 2019 |  |  | 2018 |
Deferred tax assets: |  |  |  |  |  |  |  |
Unearned premium |  | $ | 15,482,366 |  |  | $ | 15,634,433 |
Loss reserves |  |  | 7,820,683 |  |  |  | 7,644,415 |
Net operating loss carryforward |  |  | 200,942 |  |  |  | 3,090,010 |
Net state operating loss carryforward—DGI Parent |  |  | 7,519,991 |  |  |  | 8,070,196 |
Net unrealized losses |  |  | — |  |  |  | 3,782,145 |
Other |  |  | 2,603,155 |  |  |  | 2,517,791 |
Total gross deferred tax assets |  |  | 33,627,137 |  |  |  | 40,738,990 |
Less valuation allowance |  |  | (7,538,024 | ) |  |  | (8,334,663 | )
Net deferred tax assets |  |  | 26,089,113 |  |  |  | 32,404,327 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Deferred policy acquisition costs |  |  | 12,449,820 |  |  |  | 12,729,176 |
Loss reserve transition adjustment |  |  | 1,733,056 |  |  |  | 2,339,068 |
Other |  |  | 3,391,926 |  |  |  | 4,266,328 |
Total gross deferred tax liabilities |  |  | 17,574,802 |  |  |  | 19,334,572 |
Net deferred tax asset |  | $ | 8,514,311 |  |  | $ | 13,069,755 |

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