Note 7 – Investments in Securities

The aggregate estimated fair value, gross unrealized holding gains, gross unrealized holding losses and cost or amortized cost for securities by major security type are as follows:


				Gross		Gross		Estimated
		Amortized		Unrealized		Unrealized		Fair
March 31, 2012		Cost		Gains		Losses		Value
Fixed maturities, available-for-sale, at fair value-
Obligations of states and political subdivisions	$	60,381,475	$	5,290,815	$	18,167	$	65,654,123
Corporate debt securities		16,782,152		1,133,832		124,947		17,791,037
Auction rate securities		3,639,447		58,253		-		3,697,700
Total	$	80,803,074	$	6,482,900	$	143,114	$	87,142,860
Equity Securities, available-for-sale at fair value-
Common stocks and nonredeemable preferred stocks	$	19,840,045	$	7,044,101	$	59,715	$	26,824,431
Total	$	19,840,045	$	7,044,101	$	59,715	$	26,824,431
Short-term investments-
Certificates of deposit and other	$	8,571,468	$	-	$	-	$	8,571,468
Total	$	8,571,468	$	-	$	-	$	8,571,468

December 31, 2011
Fixed maturities, available-for-sale, at fair value-
Obligations of states and political subdivisions	$	62,042,929	$	5,583,733	$	13,869	$	67,612,793
Corporate debt securities		12,188,639		1,202,149		148,616		13,242,172
Auction rate securities		4,552,400		-		-		4,552,400
Total	$	78,783,968	$	6,785,882	$	162,485	$	85,407,365
Equity Securities, available-for-sale at fair value-
Common stocks and nonredeemable preferred stocks	$	17,652,745	$	4,939,053	$	41,823	$	22,549,975
Total	$	17,652,745	$	4,939,053	$	41,823	$	22,549,975
Short-term investments-
Certificates of deposit and other	$	14,112,262	$	-	$	-	$	14,112,262
Total	$	14,112,262	$	-	$	-	$	14,112,262

The scheduled maturities of fixed maturity securities at March 31, 2012 were as follows:


		Available-for-Sale
		Amortized		Fair
		Cost		Value
Due in one year or less	$	7,892,019	$	8,018,893
Due after one year through five years		34,168,120		36,402,089
Due five years through ten years		31,746,313		34,936,063
Due after ten years		6,996,622		7,785,815
Total	$	80,803,074	$	87,142,860

Gross realized gains and losses on securities for the three months ended March 31 are summarized as follows:


		2012		2011
Gross realized gains:
Obligations of states and political subdivisions	$	250	$	387
Common stocks and nonredeemable preferred stocks		152,574		46,189
Auction rate securities		40,057		15,428
Total	$	192,881	$	62,004
Gross realized losses:
Obligations of states and political subdivisions	$	-	$	-
Common stocks and nonredeemable preferred stocks		-		(13,888	)
Other than temporary impairment of securities		-		(64,468	)
Total		-		(78,356	)
Net realized (loss) gain	$	192,881	$	(16,352	)

Realized gains and losses are determined on the specific identification method. Also included in net realized gain on sales in the Consolidated Statements of Income are impairments of other investments and loss on sales of property acquired in the settlement of claims totaling $0 and $(9,808) for the three months ended March 31, 2012 and 2011, respectively.

The following table presents the gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous loss position at March 31, 2012 and December 31, 2011.

Less than 12 Months

12 Months or Longer

Total

Fair

Unrealized

Fair

Unrealized

Fair

Unrealized

Value

Losses

Value

Losses

Value

Losses

March 31, 2012

Obligations of states

and political

subdivisions

1,012,920

(18,167

)

1,012,920

(18,167

)

Corporate debt

securities

3,607,498

(60,825

)

955,750

(64,122

)

4,563,248

(124,947

)

Total Fixed Income

Securities

3,607,498

(60,825

)

1,968,670

(82,289

)

5,576,168

(143,114

)

Equity Securities

1,283,535

(59,715

)

1,283,535

(59,715

)

Total temporarily

impaired securities

4,891,033

(120,540

)

1,968,670

(82,289

)

6,859,703

(202,829

)


		Less than 12 Months					12 Months or Longer					Total
		Fair		Unrealized			Fair		Unrealized			Fair	Unrealized
		Value		Losses			Value		Losses			Value		Losses
December 31, 2011
Obligations of states
and political
subdivisions	$	663,666	$	(64	)	$	1,023,180	$	(13,805	)	$	1,686,846	$	(13,869	)
Corporate debt
securities		3,015,769		(148,616	)		-		-			3,015,769		(148,616	)
Total Fixed Income
Securities	$	3,679,435	$	(148,680	)	$	1,023,180	$	(13,805	)	$	4,702,615	$	(162,485	)
Equity Securities		957,072		(40,893	)		104,130		(930	)		1,061,202		(41,823	)
Total temporarily
impaired securities	$	4,636,507	$	(189,573	)	$	1,127,310	$	(14,735	)	$	5,763,817	$	(204,308	)

As of March 31, 2012, the Company held $5,576,168 in fixed maturity securities with unrealized losses of $143,114. As of December 31, 2011, the Company held $4,702,615 in fixed maturity securities with unrealized losses of $162,485. The decline in fair value of the fixed maturity securities can be attributed primarily to changes in market interest rates and changes in credit spreads over treasury securities. Because the Company does not have the intent to sell these securities and will likely not be compelled to sell them before it can recover its cost basis, the Company does not consider these investments to be other-than-temporarily impaired.

As of March 31, 2012, the Company held $1,283,535 in equity securities with unrealized losses of $59,715. As of December 31, 2011, the Company held $1,061,202 in equity securities with unrealized losses of $41,823. The unrealized losses related to holdings of equity securities were caused by market changes that the Company considers to be temporary. Since the Company has the intent and ability to hold these equity securities until a recovery of fair value, the Company does not consider these investments other-than-temporarily impaired.

Factors considered in determining whether a loss is temporary include the length of time and extent to which fair value has been below cost, the financial condition and prospects of the issuer (including credit ratings and analyst reports) and macro-economic changes. A total of 12 and 13 securities had unrealized losses at March 31, 2012 and December 31, 2011, respectively. Reviews of the values of securities are inherently uncertain and the value of the investment may not fully recover, or may decline in future periods resulting in a realized loss. During the first quarter 2012, the Company did not have other-than-temporary impairment charges. During the first quarter of 2011, the Company recorded other-than-temporary impairment charges in the amount of $69,276 related to stocks and other assets. For the 2011 fiscal year, the Company recorded other-than-temporary impairment charges in the amount of $280,987 related to securities and other assets, of which, $101,861 was related to Level 3 auction rate securities. Other-than-temporary impairment charges are included in net realized gain on investments in the Consolidated Statements of Income.