Note 2. Investments

The following tables set forth the estimated fair value, gross unrealized gains, gross unrealized losses and cost or amortized cost of the Company’s investments in fixed maturities and equity securities, aggregated by type and industry, as of December 31, 2018 and December 31, 2017.

Fixed maturities were comprised of the following:

	2018
	Estimated Fair Value		Gross Unrealized Gains		Gross Unrealized Losses		Amortized Cost
Fixed maturities:
Bonds:
U.S. Treasury securities and obligations of U.S. Government agencies and authorities	$	27,422	$	36	$	1,061	$	28,447
Obligations of states and political subdivisions		8,364		347		72		8,089
Corporate securities:
Utilities and telecom		19,642		873		431		19,200
Financial services		49,477		747		2,942		51,672
Other business – diversified		49,196		226		2,844		51,814
Other consumer – diversified		56,093		84		4,501		60,510
Total corporate securities		174,408		1,930		10,718		183,196
Redeemable preferred stocks:
Other consumer – diversified		192		-		-		192
Total redeemable preferred stocks		192		-		-		192
Total fixed maturities	$	210,386	$	2,313	$	11,851	$	219,924

	2017
	Estimated Fair Value		Gross Unrealized Gains		Gross Unrealized Losses		Amortized Cost
Fixed maturities:
Bonds:
U.S. Treasury securities and obligations of U.S. Government agencies and authorities	$	31,155	$	149	$	511	$	31,517
Obligations of states and political subdivisions		10,809		630		1		10,180
Corporate securities:
Utilities and telecom		21,882		1,709		130		20,303
Financial services		53,686		2,049		453		52,090
Other business – diversified		44,184		1,024		1,349		44,509
Other consumer – diversified		53,200		924		1,477		53,753
Total corporate securities		172,952		5,706		3,409		170,655
Redeemable preferred stocks:
Other consumer – diversified		192		-		-		192
Total redeemable preferred stocks		192		-		-		192
Total fixed maturities	$	215,108	$	6,485	$	3,921	$	212,544

Bonds having an amortized cost of $10,452 and $11,178 and included in the tables above were on deposit with insurance regulatory authorities at December 31, 2018 and 2017, respectively, in accordance with statutory requirements.

	2018
	Estimated Fair Value		Gross Unrealized Gains		Gross Unrealized Losses		Cost or Amortized Cost
Equity securities:
Common and non-redeemable preferred stocks:
Utilities and telecom		1,686		722		-		964
Financial services		4,552		172		-		4,380
Other business – diversified		306		259		-		47
Other consumer – diversified		14,214		9,090		-		5,124
Total equity securities	$	20,758	$	10,243	$	-	$	10,515

	2017
	Estimated Fair Value		Gross Unrealized Gains		Gross Unrealized Losses		Cost or Amortized Cost
Equity securities:
Common and non-redeemable preferred stocks:
Utilities and telecom		1,588		624		-		964
Financial services		5,634		851		-		4,783
Other business – diversified		297		250		-		47
Other consumer – diversified		15,836		10,712		-		5,124
Total equity securities	$	23,355	$	12,437	$	-	$	10,918

The carrying value and amortized cost of the Company’s investments in fixed maturities at December 31, 2018 and 2017 by contractual maturity were as follows. Actual maturities may differ from contractual maturities because issuers may call or prepay obligations with or without call or prepayment penalties.

	2018				2017
	Carrying Value		Amortized Cost		Carrying Value		Amortized Cost
Due in one year or less	$	3,150	$	3,150	$	1,653	$	1,655
Due after one year through five years		19,787		19,699		13,738		14,056
Due after five years through ten years		127,617		133,863		112,847		112,116
Due after ten years		43,823		46,338		67,328		64,928
Asset backed securities		16,009		16,874		19,542		19,789
Totals	$	210,386	$	219,924	$	215,108	$	212,544

The following tables present the Company’s unrealized loss aging for securities by type and length of time the security was in a continuous unrealized loss position as of December 31, 2018 and 2017.

	2018
	Less than 12 months						12 months or longer						Total
	Fair Value			Unrealized Losses			Fair Value			Unrealized Losses			Fair Value			Unrealized Losses

U.S. Treasury securities and obligations of U.S. Government agencies and authorities		$	-		$	-		$	24,786		$	1,061		$	24,786		$	1,061
Obligations of states and political subdivisions			-			-			3,980			72			3,980			72
Corporate securities			49,633			1,592			97,012			9,126			146,645			10,718
Total temporarily impaired securities		$	49,633		$	1,592		$	125,778		$	10,259		$	175,411		$	11,851

	2017
	Less than 12 months						12 months or longer						Total
	Fair Value			Unrealized Losses			Fair Value			Unrealized Losses			Fair Value			Unrealized Losses

U.S. Treasury securities and obligations of U.S. Government agencies and authorities		$	12,175		$	162		$	12,737		$	349		$	24,912		$	511
Obligations of states and political subdivisions			999			1			-			-			999			1
Corporate securities			40,108			653			32,667			2,756			72,775			3,409
Total temporarily impaired securities		$	53,282		$	816		$	45,404		$	3,105		$	98,686		$	3,921

The evaluation for an other than temporary impairment is a quantitative and qualitative process, which is subject to risks and uncertainties in the determination of whether declines in the fair value of investments are other than temporary. Potential risks and uncertainties include, among other things, changes in general economic conditions, an issuer’s financial condition or near term recovery prospects and the effects of changes in interest rates. In evaluating a potential impairment, the Company considers, among other factors, management’s intent and ability to hold the securities until price recovery, the nature of the investment and the expectation of prospects for the issuer and its industry, the status of an issuer’s continued satisfaction of its obligations in accordance with their contractual terms, and management’s expectation as to the issuer’s ability and intent to continue to do so, as well as ratings actions that may affect the issuer’s credit status.

During the year ended December 31, 2018, the Company recorded OTTI charges related to certain fixed maturity securities of $1,525 as a charge to net income due to management’s intention to sell such securities. There were no OTTI charges recorded in 2017.

As of December 31, 2018 and 2017, there were one hundred forty and sixty-nine securities, respectively, in an unrealized loss position which primarily included certain of the Company’s investments in fixed maturities within the financial services, other diversified business and other diversified consumer sectors. The increase in the number and value of securities in an unrealized loss position during the year ended December 31, 2018, was primarily attributable to the rising interest rate environment. Other than securities for which an impairment charge has already been taken, the Company does not currently intend to sell nor does it expect to be required to sell any of the securities in an unrealized loss position. Based upon the Company’s expected continuation of receipt of contractually required principal and interest payments and its intent and ability to retain the securities until price recovery, as well as the Company’s evaluation of other relevant factors, including those described above, the Company has deemed these securities to be temporarily impaired as of December 31, 2018.

Investment income was earned from the following sources:

	2018		2017
Fixed maturities	$	8,432	$	8,297
Equity securities		440		467
Other		677		(268	)
Net investment income	$	9,549	$	8,496

A summary of realized investment gains (losses) follows:

	2018
	Fixed Maturities				Equity Securities			Other Invested Assets			Total
Gains		$	884			$	272		$	5,827		$	6,983
Losses			(1,829	)			-			-			(1,829	)
Realized investment gains (losses), net		$	(945	)		$	272		$	5,827		$	5,154

	2017
	Fixed Maturities				Equity Securities			Other Invested Assets			Total
Gains		$	2,226			$	1,044		$	6,040		$	9,310
Losses			(142	)			-			-			(142	)
Realized investment gains, net		$	2,084			$	1,044		$	6,040		$	9,168

Proceeds from the sales of investments were as follows:

	2018		2017
Fixed maturities	$	30,078	$	72,760
Equity securities		-		1,579
Other investments		10,839		9,653
Total proceeds	$	40,917	$	83,992

	2018			2017
Net gains (losses) recognized during the period on equity securities	$	(1,922	)	$	-
Less: Net gains (losses) recognized during the period on equity securities sold during the period		(272	)		-
Net unrealized gains (losses) recognized during the reporting period on equity securities still held at the reporting date	$	(2,194	)	$	-

The Company’s bond portfolio included 94% investment grade securities, as defined by the NAIC, at December 31, 2018.

Variable Interest Entities

The Company holds passive interests in a number of entities that are considered to be Variable Interest Entities (VIEs) under GAAP guidance. The Company’s VIE interests principally consist of interests in limited partnerships and limited liability companies formed for the purpose of achieving diversified equity returns. The Company’s VIE interests, carried as a part of other invested assets, totaled $7,424 and $5,626 at December 31, 2018 and 2017, respectively. The Company’s VIE interests, carried as a part of investment in unconsolidated subsidiaries, totaled $1,238 at December 31, 2018 and 2017.

The Company does not have power over the activities that most significantly impact the economic performance of these VIEs and thus is not the primary beneficiary. Therefore, the Company has not consolidated these VIEs. The Company’s involvement with each VIE is limited to its direct ownership interest in the VIE. The Company has no arrangements with any of the VIEs to provide other financial support to or on behalf of the VIE. At December 31, 2018, the Company’s maximum loss exposure relative to these investments was limited to the carrying value of the Company’s investment in the VIE.