SEGMENTS

The Company’s property and casualty insurance operations comprise one business segment. The property and casualty insurance segment primarily underwrites home insurance coverage with primary lines of business consisting of: dwelling fire and extended coverage, homeowners (including mobile homeowners) and other liability. The Company has ceased writing ocean marine, private passenger auto liability, commercial auto liability and auto physical damage coverages over the past two years with no policies remaining in-force at December 31, 2013 in the lines of business.

Management organizes the business utilizing a niche strategy focusing on lower valued dwellings. Our chief decision makers (Chief Executive Officer, Chief Financial Officer and President) review results and operating plans making decisions on resource allocations on a company-wide basis. The Company’s products are primarily produced through agents within the states in which we operate.

The Company’s life and accident and health operations comprise the second business segment. The life and accident and health insurance segment consists of two lines of business: traditional life insurance and accident and health insurance.

Total assets by industry segment at June 30, 2014 and at December 31, 2013 are summarized below (dollars in thousands):



	Total		P&C Insurance Operations		Life Insurance Operations		Non-Insurance Operations
June 30, 2014
	$	143,267	$	79,722	$	56,420	$	7,125
December 31, 2013
	$	133,980	$	71,003	$	53,831	$	9,146

Premium revenues and operating income by business segment for the three and six months ended June 30, 2014 and 2013 are summarized below (dollars in thousands):



Three months ended June 30, 2014	Total		P&C Insurance Operations		Life Insurance Operations			Non-Insurance Operations
REVENUE
Net premiums earned	$	14,100	$	12,467	$	1,633		$	—
Net investment income	1,030		508		503			19
Net realized investment gains	312		1		310			1
Other income	1,713		1,713		—			—
	17,155		14,689		2,446			20
BENEFITS, LOSSES AND EXPENSES
Policyholder benefits paid	9,155		7,566		1,589			—
Amortization of deferred policy acquisition costs	873		641		232			—
Commissions	1,967		1,890		77			—
General and administrative expenses	2,413		1,532		598			283
Taxes, licenses and fees	521		457		64			—
Interest expense	382		—		14			368
	15,311		12,086		2,574			651
Income (Loss) Before Income Taxes	$	1,844	$	2,603	$	(128	)	$	(631	)



Three months ended June 30, 2013	Total		P&C Insurance Operations		Life Insurance Operations			Non-Insurance Operations
REVENUE
Net premiums earned	$	13,038	$	11,376	$	1,662		$	—
Net investment income	689		219		451			19
Net realized investment gains	1,030		1,028		2			—
Other income	145		145		—			—
	14,902		12,768		2,115			19
BENEFITS, LOSSES AND EXPENSES
Policyholder benefits paid	8,260		7,076		1,184			—
Amortization of deferred policy acquisition costs	923		638		285			—
Commissions	1,486		1,396		90			—
General and administrative expenses	2,162		1,363		510			289
Taxes, licenses and fees	474		423		51			—
Interest expense	435		—		17			418
	13,740		10,896		2,137			707
Income (Loss) Before Income Taxes	$	1,162	$	1,872	$	(22	)	$	(688	)



Six months ended June 30, 2014	Total		P&C Insurance Operations		Life Insurance Operations			Non-Insurance Operations
REVENUE
Net premiums earned	$	27,924	$	24,640	$	3,284		$	—
Net investment income	1,978		963		977			38
Net realized investment gains	400		49		350			1
Other income	1,867		1,866		1			—
	32,169		27,518		4,612			39
BENEFITS AND EXPENSES
Policyholder benefits paid	17,019		14,230		2,789			—
Amortization of deferred policy acquisition costs	1,771		1,282		489			—
Commissions	3,994		3,835		159			—
General and administrative expenses	4,439		2,989		1,058			392
Taxes, licenses and fees	1,051		921		130			—
Interest expense	768		—		31			737
	29,042		23,257		4,656			1,129
Income (Loss) Before Income Taxes	$	3,127	$	4,261	$	(44	)	$	(1,090	)



Six months ended June 30, 2013	Total		P&C Insurance Operations		Life Insurance Operations		Non-Insurance Operations
REVENUE
Net premiums earned	$	25,972	$	22,564	$	3,408	$	—
Net investment income	1,734		696		1,000		38
Net realized investment gains	1,057		1,030		27		—
Other income	317		315		2		—
	29,080		24,605		4,437		38
BENEFITS AND EXPENSES
Policyholder benefits paid	17,811		15,629		2,182		—
Amortization of deferred policy acquisition costs	1,865		1,299		566		—
Commissions	3,468		3,282		186		—
General and administrative expenses	3,965		2,608		912		445
Taxes, licenses and fees	960		835		125		—
Interest expense	877		—		38		839
	28,946		23,653		4,009		1,284
Income (Loss) Before Income Taxes	$	134	$	952	$	428	$	(1,246	)

The following table presents the Company’s gross and net premiums written for the property and casualty segment and the life and accident and health segment for the three and six months ended June 30, 2014 and 2013, respectively:



	Three months ended June 30,						Six months ended June 30,
	2014			2013			2014			2013
Life, accident and health operations premiums written:
Traditional life insurance	$	1,137		$	1,184		$	2,316		$	2,402
Accident and health insurance	431			437			875			881
Gross life, accident and health	1,568			1,621			3,191			3,283
Reinsurance premium ceded	(12		)	(11		)	(35		)	(30		)
Net life, accident and health premiums written	$	1,556		$	1,610		$	3,156		$	3,253

Property and Casualty operations premiums written:
Dwelling fire & extended coverage	$	9,219		$	8,406		$	17,548		$	15,965
Homeowners (Including mobile homeowners)	6,879			6,756			12,628			12,177
Ocean marine	—			(17		)	—			75
Other liability	521			474			990			882
Gross property and casualty	16,619			15,619			31,166			29,099
Reinsurance premium ceded	(1,802		)	(2,188		)	(3,557		)	(4,320		)
Net property and casualty written	$	14,817		$	13,431		$	27,609		$	24,779

Gross premiums written	$	18,187		$	17,240		$	34,357		$	32,382
Reinsurance premium ceded	(1,814		)	(2,199		)	(3,592		)	(4,350		)
Net premiums written	$	16,373		$	15,041		$	30,765		$	28,032

The following table presents the Company’s gross and net premiums earned for the property and casualty segment and the life and accident and health segment for the three and six months ended June 30, 2014 and 2013, respectively:



	Three months ended June 30,						Six months ended June 30,
	2014			2013			2014			2013
Life, accident and health operations premiums earned:
Traditional life insurance	$	1,214		$	1,240		$	2,457		$	2,556
Accident and health insurance	431			433			862			882
Gross life, accident and health	1,645			1,673			3,319			3,438
Reinsurance premium ceded	(12		)	(11		)	(35		)	(30		)
Net life, accident and health premiums earned	$	1,633		$	1,662		$	3,284		$	3,408

Property and Casualty operations premiums earned:
Dwelling fire & extended coverage	$	7,910		$	7,256		$	15,580		$	14,274
Homeowners (Including mobile homeowners)	5,916			5,652			11,747			11,333
Ocean marine	—			269			—			524
Other liability	443			391			870			764
Gross property and casualty	14,269			13,568			28,197			26,895
Reinsurance premium ceded	(1,802		)	(2,192		)	(3,557		)	(4,331		)
Net property and casualty earned	$	12,467		$	11,376		$	24,640		$	22,564

Gross premiums earned	$	15,914		$	15,241		$	31,516		$	30,333
Reinsurance premium ceded	(1,814		)	(2,203		)	(3,592		)	(4,361		)
Net premiums earned	$	14,100		$	13,038		$	27,924		$	25,972