DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2013

DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract]

Summary of carrying amount and estimated fair value of financial instruments

The carrying amount and the estimated fair value of the Company's financial instruments is summarized below.

	Carrying		Estimated
	amount		fair value
March 31, 2013
Assets:
Fixed maturity securities available-for-sale:
U.S. treasury	$	4,970,799	$	4,970,799
U.S. government-sponsored agencies		161,772,309		161,772,309
Obligations of states and political subdivisions		363,157,080		363,157,080
Commercial mortgage-backed		72,673,740		72,673,740
Residential mortgage-backed		60,165,897		60,165,897
Other asset-backed		10,610,721		10,610,721
Corporate		320,763,813		320,763,813
Total fixed maturity securities available-for-sale		994,114,359		994,114,359

Equity securities available-for-sale:
Common stocks:
Financial services		23,704,631		23,704,631
Information technology		14,927,793		14,927,793
Healthcare		21,191,636		21,191,636
Consumer staples		16,159,278		16,159,278
Consumer discretionary		17,599,933		17,599,933
Energy		23,261,841		23,261,841
Industrials		9,926,315		9,926,315
Other		20,204,612		20,204,612
Non-redeemable preferred stocks		8,934,759		8,934,759
Total equity securities available-for-sale		155,910,798		155,910,798

Short-term investments		60,946,630		60,946,630

Liabilities:
Surplus notes		25,000,000		10,738,321

	Carrying		Estimated
	amount		fair value
December 31, 2012
Assets:
Fixed maturity securities available-for-sale:
U.S. treasury	$	4,984,902	$	4,984,902
U.S. government-sponsored agencies		162,442,630		162,442,630
Obligations of states and political subdivisions		370,962,114		370,962,114
Commercial mortgage-backed		80,349,182		80,349,182
Residential mortgage-backed		47,789,604		47,789,604
Other asset-backed		11,286,848		11,286,848
Corporate		321,979,577		321,979,577
Total fixed maturity securities available-for-sale		999,794,857		999,794,857

Equity securities available-for-sale:
Common stocks:
Financial services		18,093,388		18,093,388
Information technology		16,925,764		16,925,764
Healthcare		19,023,849		19,023,849
Consumer staples		13,609,527		13,609,527
Consumer discretionary		17,090,547		17,090,547
Energy		19,430,330		19,430,330
Industrials		8,574,816		8,574,816
Other		18,681,440		18,681,440
Non-redeemable preferred stocks		8,864,164		8,864,164
Total equity securities available-for-sale		140,293,825		140,293,825

Short-term investments		53,418,914		53,418,914

Liabilities:
Surplus notes		25,000,000		18,835,954

Summary of assets and liabilities measured on recurring and non-recurring basis

Presented in the table below are the estimated fair values of the Company's financial instruments as of March 31, 2013 and December 31, 2012.

			Fair value measurements at March 31, 2013 using
			Quoted
			prices in		Significant
			active markets		other		Significant
			for identical		observable		unobservable
			assets		inputs		inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
Financial instruments reported at fair value on recurring basis:
Assets:
Fixed maturity securities available-for-sale:
U.S. treasury	$	4,970,799	$	-	$	4,970,799	$	-
U.S. government-sponsored agencies		161,772,309		-		161,772,309		-
Obligations of states and political subdivisions		363,157,080		-		363,157,080		-
Commercial mortgage-backed		72,673,740		-		72,673,740		-
Residential mortgage-backed		60,165,897		-		60,165,897		-
Other asset-backed		10,610,721		-		10,610,721		-
Corporate		320,763,813		-		320,763,813		-
Total fixed maturity securities available-for-sale		994,114,359		-		994,114,359		-

Equity securities available-for-sale:
Common stocks:
Financial services		23,704,631		23,702,230		-		2,401
Information technology		14,927,793		14,927,793		-		-
Healthcare		21,191,636		21,191,636		-		-
Consumer staples		16,159,278		16,159,278		-		-
Consumer discretionary		17,599,933		17,599,933		-		-
Energy		23,261,841		23,261,841		-		-
Industrials		9,926,315		9,926,315		-		-
Other		20,204,612		20,204,612		-		-
Non-redeemable preferred stocks		8,934,759		8,934,759		-		-
Total equity securities available-for-sale		155,910,798		155,908,397		-		2,401

Short-term investments		60,946,630		60,946,630		-		-

Financial instruments not reported at fair value:
Liabilities:
Surplus notes		10,738,321		-		-		10,738,321

			Fair value measurements at December 31, 2012 using
			Quoted
			prices in		Significant
			active markets		other		Significant
			for identical		observable		unobservable
			assets		inputs		inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
Financial instruments reported at fair value on recurring basis:
Assets:
Fixed maturity securities available-for-sale:
U.S. treasury	$	4,984,902	$	-	$	4,984,902	$	-
U.S. government-sponsored agencies		162,442,630		-		162,442,630		-
Obligations of states and political subdivisions		370,962,114		-		370,962,114		-
Commercial mortgage-backed		80,349,182		-		80,349,182		-
Residential mortgage-backed		47,789,604		-		47,789,604		-
Other asset-backed		11,286,848		-		11,286,848		-
Corporate		321,979,577		-		321,979,577		-
Total fixed maturity securities available-for-sale		999,794,857		-		999,794,857		-

Equity securities available-for-sale:
Common stocks:
Financial services		18,093,388		18,090,987		-		2,401
Information technology		16,925,764		16,925,764		-		-
Healthcare		19,023,849		19,023,849		-		-
Consumer staples		13,609,527		13,609,527		-		-
Consumer discretionary		17,090,547		17,090,547		-		-
Energy		19,430,330		19,430,330		-		-
Industrials		8,574,816		8,574,816		-		-
Other		18,681,440		18,681,440		-		-
Non-redeemable preferred stocks		8,864,164		8,864,164		-		-
Total equity securities available-for-sale		140,293,825		140,291,424		-		2,401

Short-term investments		53,418,914		42,062,664		11,356,250		-

Financial instruments not reported at fair value:
Liabilities:
Surplus notes		18,835,954		-		-		18,835,954

Reconciliation of assets measured at fair value on recurring basis using significant unobservable inputs

Presented in the table below is a reconciliation of the assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three months ended March 31, 2013 and 2012. Any unrealized gains or losses on these securities are recognized in other comprehensive income. Any gains or losses from disposals or impairments of these securities are reported as realized investment gains or losses in net income.

	Fair value measurements using significant
	unobservable inputs (Level 3)
	Equity securities
	available-for-sale,
	financial services		Total
Balance at December 31, 2011	$	2,250	$	2,250
Unrealized gains included in other comprehensive income		-		-
Balance at March 31, 2012	$	2,250	$	2,250

Balance at December 31, 2012	$	2,401	$	2,401
Unrealized gains included in other comprehensive income		-		-
Balance at March 31, 2013	$	2,401	$	2,401

- Definition

Tabular disclosure related to assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a recurring and/or nonrecurring basis in periods after initial recognition. Disclosures include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3) as well as transfers between levels 1 and 2.

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- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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- Definition

Tabular disclosure of the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such certain disclosures about the financial instruments, assets, and liabilities include: (1) the fair value of the required items together with their carrying amounts (as appropriate) and (2) the methodology and assumptions used in developing such estimates of fair value.

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-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

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