3. Investments

Investments, Available-for-Sale

The following tables summarize the Company’s investment securities (in thousands).

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
March 31, 2016	Cost		Gains		Losses			Value
U.S. government and agencies	$	13,036	$	330	$	—		$	13,366
State		698		5		—			703
Political subdivisions		4,323		51		—			4,374
Revenue and assessment		10,117		1,161		—			11,278
Corporate bonds		78,181		3,480		(63	)		81,598
Collateralized mortgage obligations:
Agency backed		782		85		—			867
Non-agency backed – residential		2,750		491		(11	)		3,230
Non-agency backed – commercial		1,673		452	—				2,125
Total fixed maturities, available-for-sale		111,560		6,055		(74	)		117,541
Preferred stock, available-for-sale		1,500		265		—			1,765
Mutual funds, available-for-sale		11,959		176		(543	)		11,592
	$	125,019	$	6,496	$	(617	)	$	130,898

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
December 31, 2015	Cost		Gains		Losses			Value
U.S. government and agencies	$	13,036	$	162	$	(85	)	$	13,113
State		698		4		—			702
Political subdivisions		4,354		9		—			4,363
Revenue and assessment		11,770		895		(21	)		12,644
Corporate bonds		79,426		2,022		(663	)		80,785
Collateralized mortgage obligations:
Agency backed		793		80		—			873
Non-agency backed – residential		2,877		579		(1	)		3,455
Non-agency backed – commercial		1,891		616		—			2,507
Total fixed maturities, available-for-sale		114,845		4,367		(770	)		118,442
Preferred stock, available-for-sale		1,500		223		—			1,723
Mutual funds, available-for-sale		11,959		120		(662	)		11,417
	$	128,304	$	4,710	$	(1,432	)	$	131,582

The following table sets forth the scheduled maturities of the Company’s fixed maturity securities based on their fair values (in thousands). Actual maturities may differ from contractual maturities because certain securities may be called or prepaid by the issuers.

					Securities
	Securities		Securities		with No		All
	with		with		Unrealized		Fixed
	Unrealized		Unrealized		Gains or		Maturity
March 31, 2016	Gains		Losses		Losses		Securities
One year or less	$	2,477	$	—	$	1,025	$	3,502
After one through five years		27,586		7,823		—		35,409
After five through ten years		63,765		—		—		63,765
After ten years		8,643		—		—		8,643
No single maturity date		5,918		304		—		6,222
	$	108,389	$	8,127	$	1,025	$	117,541

The following table reflects the number of fixed maturity securities with gross unrealized gains and losses. Gross unrealized losses are further segregated by the length of time that individual securities have been in a continuous unrealized loss position.

Gross Unrealized Losses

Less than

Greater

Gross

or equal to

than 12

Unrealized

At:

12 months

months

Gains

March 31, 2016

December 31, 2015

The following tables reflect the fair value and gross unrealized losses of those fixed maturity securities in a continuous unrealized loss position for greater than 12 months. Gross unrealized losses are further segregated by the percentage of amortized cost (in thousands, except number of securities).

	Number				Gross
Gross Unrealized Losses	of		Fair		Unrealized
at March 31, 2016:	Securities		Value		Losses
Less than or equal to 10%		2	$	4,272		(34	)
Greater than 10%		—		—		—
		2	$	4,272	$	(34	)

	Number				Gross
Gross Unrealized Losses	of		Fair		Unrealized
at December 31, 2015:	Securities		Value		Losses
Less than or equal to 10%		4	$	7,689	$	(241	)
Greater than 10%		—		—		—
		4	$	7,689	$	(241	)

The following tables set forth the amount of gross unrealized losses by current severity (as compared to amortized cost) and length of time that individual securities have been in a continuous unrealized loss position (in thousands).

	Fair Value of
	Securities with
Length of	Gross		Gross			Severity of Gross Unrealized Losses
Gross Unrealized Losses	Unrealized		Unrealized			Less			5% to			Greater
at March 31, 2016:	Losses		Losses			than 5%				10%		than 10%
Less than or equal to:
Three months	$	400	$	(9	)	$	—		$	(9	)	$	—
Six months		—		—			—			—			—
Nine months		7,150		(351	)		(351	)		—			—
Twelve months		5,362		(223	)		(29	)		(192	)		(2	)
Greater than twelve months		4,272		(34	)		(34	)		—			—
Total	$	17,184	$	(617	)	$	(414	)	$	(201	)	$	(2	)

	Fair Value of
	Securities with
Length of	Gross		Gross			Severity of Gross Unrealized Losses
Gross Unrealized Losses	Unrealized		Unrealized			Less			5% to			Greater
at December 31, 2015:	Losses		Losses			than 5%				10%		than 10%
Less than or equal to:
Three months	$	20,899	$	(130	)	$	(130	)	$	—		$	—
Six months		7,036		(465	)		—			(465	)		—
Nine months		14,057		(395	)		(197	)		(197	)		(1	)
Twelve months		7,892		(201	)		(201	)		—			—
Greater than twelve months		7,689		(241	)		(241	)		—			—
Total	$	57,573	$	(1,432	)	$	(769	)	$	(662	)	$	(1	)

Other-Than-Temporary Impairment

The determination of whether unrealized losses are “other-than-temporary” requires judgment based on subjective as well as objective factors. The Company routinely monitors its investment portfolio for changes in fair value that might indicate potential impairments and performs detailed reviews on such securities. Changes in fair value are evaluated to determine the extent to which such changes are attributable to (i) fundamental factors specific to the issuer or (ii) market-related factors such as interest rates or sector declines.

The Company believes that the securities having unrealized losses at March 31, 2016 were not other-than-temporarily impaired. The Company also does not intend to sell any of these securities and it is more likely than not that the Company will not be required to sell any of these securities before the recovery of their amortized cost basis.

Other Investments

Other investments consist of the common stock of a real estate investment trust and limited partnership interests in three funds that invest in (i) commercial real estate and secured commercial real estate loans acquired from financial intuitions, (ii) small balance distressed secured loans and debt securities and (iii) undervalued international publicly-traded equities. These investments have redemption and transfer restrictions. The Company is in the process of withdrawing from one of the limited partnership investments and will receive the balance of its remaining $2.3 million investment in two installments through July 2016. The Company does not intend to sell the remaining investments, and it is more likely than not that the Company will not be required to sell them before the expiration of such restrictions. At March 31, 2016, the Company had unfunded commitments of $0.9 million with two of these investments.

Restrictions

At March 31, 2016, fixed maturities and cash equivalents with a fair value and amortized cost of $6.6 million were on deposit with various insurance departments as a requirement of doing business in those states. Cash equivalents with a fair value and amortized cost of $9.7 million were on deposit with another insurance company as collateral for an assumed reinsurance contract.

Investment Income and Net Realized Gains and Losses

The major categories of investment income follow (in thousands).

	Three Months Ended
	March 31,
	2016			2015
Fixed maturities, available-for-sale	$	970		$	1,043
Mutual funds, available-for-sale		206			147
Other investments		(170	)		46
Other		78			31
Investment expenses		(122	)		(122	)
	$	962		$	1,145

The components of net realized losses on investments, available-for-sale at fair value follow (in thousands).

	Three Months Ended
	March 31,
	2016			2015
Gains	$	-		$	-
Losses		(2	)		(3	)
	$	(2	)	$	(3	)

Realized gains and losses on sales and redemptions are computed based on specific identification. The non-credit related portion of other-than-temporary impairment (“OTTI”) is included in other comprehensive (loss) income. The amounts of non-credit OTTI for securities still owned was $0.9 million for non-agency backed residential collateralized mortgage obligations (“CMOs”) and $0.2 million related to non-agency backed commercial CMOs at both March 31, 2016 and December 31, 2015.