XML 19 R9.htm IDEA: XBRL DOCUMENT
v3.22.1

Investments | 3 Months Ended
--- | ---
Mar. 31, 2022
Investments |
Investments | Note 3 - Investments Fixed-Maturity Securities The amortized cost, estimated fair value, and unrealized gains and losses on investments in fixed-maturity securities classified as available-for-sale as of March 31, 2022 and December 31, 2021 are summarized as follows:
|  | March 31, 2022 |
|  | Cost or |  |  | Gross |  |  | Gross Unrealized Losses |  |  | Estimated |  |  | Net |
|  | Amortized |  |  | Unrealized |  |  | Less than 12 |  |  | More than 12 |  |  | Fair |  |  | Unrealized |
Category |  | Cost |  |  | Gains |  |  | Months |  |  | Months |  |  | Value |  |  | Losses |
Fixed-Maturity Securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Political subdivisions of States, |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Territories and Possessions |  | $ | 17,227,562 |  |  | $ | 5,692 |  |  | $ | (1,614,463 | ) |  | $ | - |  |  | $ | 15,618,791 |  |  | $ | (1,608,771 | )
Corporate and other bonds |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Industrial and miscellaneous |  |  | 85,566,044 |  |  |  | 336,272 |  |  |  | (3,143,378 | ) |  |  | - |  |  |  | 82,758,938 |  |  |  | (2,807,106 | )
Residential mortgage and other asset backed securities |  |  | 56,656,711 |  |  |  | 289,836 |  |  |  | (3,119,931 | ) |  |  | (306,849 | ) |  |  | 53,519,767 |  |  |  | (3,136,944 | )
Total fixed-maturity securities |  | $ | 159,450,317 |  |  | $ | 631,800 |  |  | $ | (7,877,772 | ) |  | $ | (306,849 | ) |  | $ | 151,897,496 |  |  | $ | (7,552,821 | )
|  | December 31, 2021 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Net |
|  | Cost or |  |  | Gross |  |  | Gross Unrealized Losses |  |  | Estimated |  |  | Unrealized |
|  | Amortized |  |  | Unrealized |  |  | Less than 12 |  |  | More than 12 |  |  | Fair |  |  | Gains/ |
Category |  | Cost |  |  | Gains |  |  | Months |  |  | Months |  |  | Value |  |  | (Losses) |
Fixed-Maturity Securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Political subdivisions of States, |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Territories and Possessions |  | $ | 17,236,750 |  |  | $ | 246,748 |  |  | $ | (197,984 | ) |  | $ | - |  |  | $ | 17,285,514 |  |  | $ | 48,764 |
Corporate and other bonds |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Industrial and miscellaneous |  |  | 80,534,769 |  |  |  | 2,603,411 |  |  |  | (126,926 | ) |  |  | - |  |  |  | 83,011,254 |  |  |  | 2,476,485 |
Residential mortgage and other asset backed securities |  |  | 58,036,959 |  |  |  | 355,985 |  |  |  | (489,258 | ) |  |  | (120,344 | ) |  |  | 57,783,342 |  |  |  | (253,617 | )
Total fixed-maturity securities |  | $ | 155,808,478 |  |  | $ | 3,206,144 |  |  | $ | (814,168 | ) |  | $ | (120,344 | ) |  | $ | 158,080,110 |  |  | $ | 2,271,632 |
A summary of the amortized cost and estimated fair value of the Company’s investments in available-for-sale fixed-maturity securities by contractual maturity as of March 31, 2022 and December 31, 2021 is shown below:
|  | March 31, 2022 |  |  | December 31, 2021 |
|  | Amortized |  |  | Estimated |  |  | Amortized |  |  | Estimated |
Remaining Time to Maturity |  | Cost |  |  | Fair Value |  |  | Cost |  |  | Fair Value |
Less than one year |  | $ | 496,511 |  |  | $ | 503,090 |  |  | $ | 1,153,099 |  |  | $ | 1,156,636 |
One to five years |  |  | 46,504,448 |  |  |  | 46,284,000 |  |  |  | 43,007,110 |  |  |  | 44,914,759 |
Five to ten years |  |  | 29,499,983 |  |  |  | 27,743,070 |  |  |  | 26,808,853 |  |  |  | 27,332,581 |
More than 10 years |  |  | 26,292,664 |  |  |  | 23,847,569 |  |  |  | 26,802,457 |  |  |  | 26,892,792 |
Residential mortgage and other asset backed securities |  |  | 56,656,711 |  |  |  | 53,519,767 |  |  |  | 58,036,959 |  |  |  | 57,783,342 |
Total |  | $ | 159,450,317 |  |  | $ | 151,897,496 |  |  | $ | 155,808,478 |  |  | $ | 158,080,110 |
The actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without penalties. Equity Securities The cost and estimated fair value of, and gross unrealized gains and losses on, investments in equity securities as of March 31, 2022 and December 31, 2021 are as follows:
|  | March 31, 2022 |
|  |  |  |  | Gross |  |  | Gross |  |  | Estimated |
Category |  | Cost |  |  | Gains |  |  | Losses |  |  | Fair Value |
Equity Securities: |  |  |  |  |  |  |  |  |  |  |  |
Preferred stocks |  | $ | 19,944,128 |  |  | $ | 333,811 |  |  | $ | (1,793,476 | ) |  | $ | 18,484,463 |
Common stocks, mutual funds, and exchange traded funds |  |  | 13,145,504 |  |  |  | 837,696 |  |  |  | (702,254 | ) |  |  | 13,280,946 |
Total |  | $ | 33,089,632 |  |  | $ | 1,171,507 |  |  | $ | (2,495,730 | ) |  | $ | 31,765,409 |
|  | December 31, 2021 |
|  |  |  |  |  | Gross |  |  | Gross |  |  | Estimated |
Category |  | Cost |  |  | Gains |  |  | Losses |  |  | Fair Value |
Equity Securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Preferred stocks |  | $ | 22,019,509 |  |  | $ | 1,007,009 |  |  | $ | (184,617 | ) |  | $ | 22,841,901 |
Common stocks, mutual funds, and exchange traded funds |  |  | 15,451,160 |  |  |  | 1,573,653 |  |  |  | (179,712 | ) |  |  | 16,845,101 |
Total |  | $ | 37,470,669 |  |  | $ | 2,580,662 |  |  | $ | (364,329 | ) |  | $ | 39,687,002 |
Other Investments The cost and estimated fair value of, and gross gains on, the Company’s other investments as of March 31, 2022 and December 31, 2021 are as follows:
|  | March 31, 2022 |  |  | December 31, 2021 |
|  |  |  |  | Gross |  |  | Estimated |  |  |  |  |  | Gross |  |  | Estimated |
Category |  | Cost |  |  | Gains |  |  | Fair Value |  |  | Cost |  |  | Gains |  |  | Fair Value |
Other Investments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Hedge fund |  | $ | 3,999,381 |  |  | $ | 2,626,502 |  |  | $ | 6,625,883 |  |  | $ | 3,999,381 |  |  | $ | 3,562,034 |  |  | $ | 7,561,415 |
Held-to-Maturity Securities The cost or amortized cost and estimated fair value of, and unrealized gross gains and losses on, investments in held-to-maturity fixed-maturity securities as of March 31, 2022 and December 31, 2021 are summarized as follows:
|  | March 31, 2022 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Net |
|  | Cost or |  |  | Gross |  |  | Gross Unrealized Losses |  |  | Estimated |  |  | Unrealized |
|  | Amortized |  |  | Unrealized |  |  | Less than 12 |  |  | More than 12 |  |  | Fair |  |  | Gains/ |
Category |  | Cost |  |  | Gains |  |  | Months |  |  | Months |  |  | Value |  |  | (Losses) |
Held-to-Maturity Securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities |  | $ | 729,654 |  |  | $ | 202,788 |  |  | $ | (1,177 | ) |  | $ | - |  |  | $ | 931,265 |  |  | $ | 201,611 |
Political subdivisions of States, |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Territories and Possessions |  |  | 498,249 |  |  |  | 8,421 |  |  |  | - |  |  |  | - |  |  |  | 506,670 |  |  |  | 8,421 |
Exchange traded debt |  |  | 304,111 |  |  |  | - |  |  |  | (21,611 | ) |  |  |  |  |  |  | 282,500 |  |  |  | (21,611 | )
Corporate and other bonds |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Industrial and miscellaneous |  |  | 6,233,124 |  |  |  | 56,601 |  |  |  | (380,860 | ) |  |  | - |  |  |  | 5,908,865 |  |  |  | (324,259 | )
Total |  | $ | 7,765,138 |  |  | $ | 267,810 |  |  | $ | (403,648 | ) |  | $ | - |  |  | $ | 7,629,300 |  |  | $ | (135,838 | )
|  | December 31, 2021 |
|  |  |  |  |  |  |  |  |  |  |  |  | Net |
|  | Cost or |  |  | Gross |  |  | Gross Unrealized Losses |  |  | Estimated |  |  | Unrealized |
|  | Amortized |  |  | Unrealized |  |  | Less than 12 |  |  | More than 12 |  |  | Fair |  |  | Gains/ |
Category |  | Cost |  |  | Gains |  |  | Months |  |  | Months |  |  | Value |  |  | (Losses) |
Held-to-Maturity Securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities |  | $ | 729,642 |  |  | $ | 209,633 |  |  | $ | - |  |  | $ | - |  |  | $ | 939,275 |  |  | $ | 209,633 |
Political subdivisions of States, |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Territories and Possessions |  |  | 998,239 |  |  |  | 22,856 |  |  |  | - |  |  |  | - |  |  |  | 1,021,095 |  |  |  | 22,856 |
Exchange traded debt |  |  | 304,111 |  |  |  | 85 |  |  |  | (13,921 | ) |  |  |  |  |  |  | 290,275 |  |  |  | (13,836 | )
Corporate and other bonds |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Industrial and miscellaneous |  |  | 6,234,342 |  |  |  | 280,951 |  |  |  | (12,779 | ) |  |  | - |  |  |  | 6,502,514 |  |  |  | 268,172 |
Total |  | $ | 8,266,334 |  |  | $ | 513,525 |  |  | $ | (26,700 | ) |  | $ | - |  |  | $ | 8,753,159 |  |  | $ | 486,825 |
Held-to-maturity U.S. Treasury securities are held in trust pursuant to various states’ minimum funds requirements. A summary of the amortized cost and estimated fair value of the Company’s investments in held-to-maturity securities by contractual maturity as of March 31, 2022 and December 31, 2021 is shown below:
|  | March 31, 2022 |  |  | December 31, 2021 |
|  | Amortized |  |  | Estimated |  |  | Amortized |  |  | Estimated |
Remaining Time to Maturity |  | Cost |  |  | Fair Value |  |  | Cost |  |  | Fair Value |
Less than one year |  | $ | 494,595 |  |  | $ | 501,795 |  |  | $ | 994,712 |  |  | $ | 1,008,180 |
One to five years |  |  | 1,206,159 |  |  |  | 1,262,780 |  |  |  | 1,205,829 |  |  |  | 1,290,465 |
Five to ten years |  |  | 1,516,810 |  |  |  | 1,494,773 |  |  |  | 1,513,942 |  |  |  | 1,648,808 |
More than 10 years |  |  | 4,547,574 |  |  |  | 4,369,952 |  |  |  | 4,551,851 |  |  |  | 4,805,706 |
Total |  | $ | 7,765,138 |  |  | $ | 7,629,300 |  |  | $ | 8,266,334 |  |  | $ | 8,753,159 |
The actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without penalties. Investment Income Major categories of the Company’s net investment income are summarized as follows:
|  | Three months ended |
|  | March 31, |
|  | 2022 |  |  | 2021 |
Income: |  |  |  |  |  |
Fixed-maturity securities |  | $ | 1,140,189 |  |  | $ | 1,491,127 |
Equity securities |  |  | 345,168 |  |  |  | 357,311 |
Cash and cash equivalents |  |  | 183 |  |  |  | 924 |
Total |  |  | 1,485,540 |  |  |  | 1,849,362 |
Expenses: |  |  |  |  |  |  |  |
Investment expenses |  |  | 126,440 |  |  |  | 66,166 |
Net investment income |  | $ | 1,359,100 |  |  | $ | 1,783,196 |
Proceeds from the redemption of fixed-maturity securities held-to-maturity were $500,000 and $-0- for the three months ended March 31, 2022 and 2021, respectively. Proceeds from the sale or maturity of fixed-maturity securities available-for-sale were $10,181,658 and $11,548,405 for the three months ended March 31, 2022 and 2021, respectively. Proceeds from the sale of equity securities were $4,994,884 and $6,433,262 for the three months ended March 31, 2022 and 2021, respectively. The Company’s net (losses) gains on investments are summarized as follows:
|  | Three months ended |
|  | March 31, |
|  | 2022 |  |  | 2021 |
Realized Gains (Losses) |  |  |  |  |  |
Fixed-maturity securities: |  |  |  |  |  |
Gross realized gains |  | $ | 85,100 |  |  | $ | 410,311 |
Gross realized losses |  |  | (126,424 | ) |  |  | (15,986 | )
|  |  | (41,324 | ) |  |  | 394,325 |
Equity securities: |  |  |  |  |  |  |  |
Gross realized gains |  |  | 448,306 |  |  |  | 933,122 |
Gross realized losses |  |  | (329,221 | ) |  |  | (200,213 | )
|  |  | 119,085 |  |  |  | 732,909 |
Net realized gains |  |  | 77,761 |  |  |  | 1,127,234 |
Unrealized (Losses) Gains |  |  |  |  |  |  |  |
Equity Securities: |  |  |  |  |  |  |  |
Gross gains |  |  | - |  |  |  | 1,003,209 |
Gross losses |  |  | (3,560,634 | ) |  |  | - |
|  |  | (3,560,634 | ) |  |  | 1,003,209 |
Other Investments: |  |  |  |  |  |  |  |
Gross gains |  |  | - |  |  |  | 829,964 |
Gross losses |  |  | (915,532 | ) |  |  | - |
|  |  | (915,532 | ) |  |  | 829,964 |
Net unrealized (losses) gains |  |  | (4,476,166 | ) |  |  | 1,833,173 |
Net (losses) gains on investments |  | $ | (4,398,405 | ) |  | $ | 2,960,407 |
Impairment Review Impairment of investment securities results in a charge to operations when a market decline below cost is deemed to be other-than-temporary. The Company regularly reviews its fixed-maturity securities to evaluate the necessity of recording impairment losses for other-than-temporary declines in the estimated fair value of investments. In evaluating potential impairment, GAAP specifies (i) if the Company does not have the intent to sell a debt security prior to recovery and (ii) it is more likely than not that it will not have to sell the debt security prior to recovery, the security would not be considered other-than-temporarily impaired unless there is a credit loss. When the Company does not intend to sell the security and it is more likely than not that the Company will not have to sell the security before recovery of its cost basis, it will recognize the credit component of an other-than-temporary impairment (“OTTI”) of a debt security in earnings and the remaining portion in comprehensive loss. The credit loss component recognized in earnings is identified as the amount of principal cash flows not expected to be received over the remaining term of the security based on cash flow projections. For held-to-maturity fixed-maturity securities, the amount of OTTI recorded in comprehensive loss for the noncredit portion of a previous OTTI is amortized prospectively over the remaining life of the security based on timing of future estimated cash flows of the security. OTTI losses are recorded in the consolidated statements of operations and comprehensive loss as net realized losses on investments and result in a permanent reduction of the cost basis of the underlying investment. The determination of OTTI is a subjective process and different judgments and assumptions could affect the timing of loss realization. At March 31, 2022 and December 31, 2021, there were 100 and 48 fixed-maturity securities, respectively, that accounted for the gross unrealized losses. The Company determined that none of the unrealized losses were deemed to be OTTI for its portfolio of investments for the three months ended March 31, 2022 and 2021. Significant factors influencing the Company’s determination that unrealized losses were temporary included the magnitude of the unrealized losses in relation to each security’s cost, the nature of the investment and management’s intent and ability to hold the investment for a period of time sufficient to allow for an anticipated recovery of estimated fair value to the Company’s cost basis. The Company held available-for-sale securities with unrealized losses representing declines that were considered temporary at March 31, 2022 as follows:
|  | March 31, 2022 |
|  | Less than 12 months |  |  | 12 months or more |  |  | Total |
|  | Estimated |  |  |  |  |  | No. of |  |  | Estimated |  |  |  |  |  | No. of |  |  | Estimated |  |  |  |
|  | Fair |  |  | Unrealized |  |  | Positions |  |  | Fair |  |  | Unrealized |  |  | Positions |  |  | Fair |  |  | Unrealized |
Category |  | Value |  |  | Losses |  |  | Held |  |  | Value |  |  | Losses |  |  | Held |  |  | Value |  |  | Losses |
Fixed-Maturity Securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations and agencies |  | $ | - |  |  | $ | - |  |  |  | - |  |  | $ | - |  |  |  | - |  |  |  | - |  |  | $ | - |  |  | $ | - |
Political subdivisions of States, Territories and Possessions |  |  | 14,959,121 |  |  |  | (1,614,463 | ) |  |  | 12 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 14,959,121 |  |  |  | (1,614,463 | )
Corporate and other bonds industrial and miscellaneous |  |  | 51,973,548 |  |  |  | (3,143,378 | ) |  |  | 55 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 51,973,548 |  |  |  | (3,143,378 | )
Residential mortgage and other asset backed securities |  |  | 40,310,519 |  |  |  | (3,119,931 | ) |  |  | 31 |  |  |  | 2,733,402 |  |  |  | (306,849 | ) |  |  | 2 |  |  |  | 43,043,921 |  |  |  | (3,426,780 | )
Total fixed-maturity securities |  | $ | 107,243,188 |  |  | $ | (7,877,772 | ) |  |  | 98 |  |  | $ | 2,733,402 |  |  | $ | (306,849 | ) |  |  | 2 |  |  | $ | 109,976,590 |  |  | $ | (8,184,621 | )
The Company held available-for-sale securities with unrealized losses representing declines that were considered temporary at December 31, 2021 as follows:
|  | December 31, 2021 |
|  | Less than 12 months |  |  | 12 months or more |  |  | Total |
|  | Estimated |  |  |  |  |  | No. of |  |  | Estimated |  |  |  |  |  | No. of |  |  | Estimated |  |  |  |
|  | Fair |  |  | Unrealized |  |  | Positions |  |  | Fair |  |  | Unrealized |  |  | Positions |  |  | Fair |  |  | Unrealized |
Category |  | Value |  |  | Losses |  |  | Held |  |  | Value |  |  | Losses |  |  | Held |  |  | Value |  |  | Losses |
Fixed-Maturity Securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations and agencies |  | $ | - |  |  | $ | - |  |  |  | - |  |  | $ | - |  |  |  | - |  |  |  | - |  |  | $ | - |  |  | $ | - |
Political subdivisions of States, Territories and Possessions |  |  | 6,768,123 |  |  |  | (197,984 | ) |  |  | 5 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 6,768,123 |  |  |  | (197,984 | )
Corporate and other bonds industrial and miscellaneous |  |  | 17,593,707 |  |  |  | (126,926 | ) |  |  | 15 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 17,593,707 |  |  |  | (126,926 | )
Residential mortgage and other asset backed securities |  |  | 45,399,451 |  |  |  | (489,258 | ) |  |  | 26 |  |  |  | 2,923,182 |  |  |  | (120,344 | ) |  |  | 2 |  |  |  | 48,322,633 |  |  |  | (609,602 | )
Total fixed-maturity securities |  | $ | 69,761,281 |  |  | $ | (814,168 | ) |  |  | 46 |  |  | $ | 2,923,182 |  |  | $ | (120,344 | ) |  |  | 2 |  |  | $ | 72,684,463 |  |  | $ | (934,512 | )

X
- Definition Tabular disclosure of investment income, including, but not limited to, interest and dividend income and amortization of discount (premium) derived from debt and equity securities. Excludes realized and unrealized gain (loss) on investments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 220 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SX 210.5-03.9) -URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 220 -Section S99 -Paragraph 1 -Subparagraph (SX 210.7-04.2) -URI http://asc.fasb.org/extlink&oid=120400993&loc=SL114874131-224263 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 220 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SX 210.5-03.7(a),(b)) -URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 220 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SX 210.5-03.8) -URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227 + Details
Name: | us-gaap_InvestmentIncomeTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_InvestmentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration