Reserves For Claims

6 Months Ended

Jun. 30, 2013

Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract]

Reserves For Claims

Reserves for Claims

Transactions in the reserves for claims for the six months ended June 30, 2013 and the year ended December 31, 2012 are summarized as follows:

	June 30, 2013			December 31, 2012
Balance, beginning of period	$	39,078,000		$	37,996,000
Provision, charged to operations	607,812			6,072,115
Payments of claims, net of recoveries	(918,812		)	(4,990,115		)
Ending balance	$	38,767,000		$	39,078,000

The total reserve for all reported and unreported losses the Company incurred through June 30, 2013 is represented by the reserves for claims. The Company's reserves for unpaid losses and loss adjustment expenses are established using estimated amounts required to settle claims for which notice has been received (reported) and the amount estimated to be required to satisfy incurred claims of policyholders which may be reported in the future. Despite the variability of such estimates, management believes that the reserves are adequate to cover claim losses which might result from pending and future claims under policies issued through June 30, 2013.  The Company continually reviews and adjusts its reserve estimates to reflect its loss experience and any new information that becomes available.  Adjustments resulting from such reviews may be significant.

A summary of the Company’s loss reserves, broken down into its components of known title claims and incurred but not reported claims (“IBNR”), follows:

	June 30, 2013		%	December 31, 2012		%
Known title claims	$	4,438,667	11.4	$	5,166,370	13.2
IBNR	34,328,333		88.6	33,911,630		86.8
Total loss reserves	$	38,767,000	100.0	$	39,078,000	100.0

Claims and losses paid are charged to the reserves for claims. Although claims losses are typically paid in cash, occasionally claims are settled by purchasing the interest of the insured or the claimant in the real property. When this event occurs, the Company carries assets at the lower of cost or estimated realizable value, net of any indebtedness on the property.