INVESTMENTS

The amortized cost and aggregate fair values of investments in available-for-sale securities as of June 30, 2016 are as follows (dollars in thousands):



Available-for-sale securities:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Corporate debt securities	$	40,660	$	1,571	$	482	$	41,749
Mortgage backed securities	12,379		368		62		12,685
Private label asset backed securities	8,765		44		507		8,302
Obligations of states and political subdivisions	14,612		951		1		15,562
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	19,803		953		10		20,746
Total fixed maturities	96,219		3,887		1,062		99,044
Equity securities	2,420		2,919		66		5,273
Total	$	98,639	$	6,806	$	1,128	$	104,317

The amortized cost and aggregate fair values of investments in held-to-maturity securities as of June 30, 2016 are as follows (dollars in thousands):



Held-to-maturity securities:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Mortgage backed securities	$	2,201	$	119	$	—	$	2,320
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	35		2		—		37
Total	$	2,236	$	121	$	—	$	2,357

The amortized cost and aggregate fair values of investments in available-for-sale securities as of December 31, 2015 are as follows (dollars in thousands):



Available-for-sale securities:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Corporate debt securities	$	38,245	$	747	$	1,728	$	37,264
Mortgage backed securities	15,324		157		224		15,257
Private label asset backed securities	6,029		24		380		5,673
Obligations of states and political subdivisions	14,654		869		47		15,476
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	17,825		413		96		18,142
Total fixed maturities	92,077		2,210		2,475		91,812
Equity securities	2,420		2,590		113		4,897
Total	$	94,497	$	4,800	$	2,588	$	96,709

The amortized cost and aggregate fair values of investments in held-to-maturity securities as of December 31, 2015 are as follows (dollars in thousands):



Held-to-maturity securities:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Mortgage backed securities	$	2,395	$	62	$	—	$	2,457
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	44		3		—		47
Total	$	2,439	$	65	$	—	$	2,504

The amortized cost and aggregate fair value of debt securities at June 30, 2016, by contractual maturity, are presented in the following table (dollars in thousands). Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.



(Dollars in Thousands)	Amortized Cost		Fair Value
Available-for-sale securities:
Due in one year or less	$	3,533	$	3,622
Due after one year through five years	14,967		15,451
Due after five years through ten years	35,639		36,295
Due after ten years	42,080		43,676
Total	$	96,219	$	99,044

Held-to-maturity securities:
Due in one year or less	$	—	$	—
Due after one year through five years	53		54
Due after five years through ten years	93		102
Due after ten years	2,090		2,201
Total	$	2,236	$	2,357

A summary of securities available-for-sale with unrealized losses as of June 30, 2016, along with the related fair value, aggregated by the length of time that investments have been in a continuous unrealized loss position, is as follows (dollars in thousands):



	Less than 12 months				12 months or longer				Total
June 30, 2016	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Total Securities in a Loss Position
Fixed maturities
Corporate debt securities	$	3,313	$	39	$	5,048	$	443	$	8,361	$	482	15
Mortgage backed securities	927		60		316		2		1,243		62		6
Private label asset backed securities	3,477		264		2,386		243		5,863		507		9
Obligations of state and political subdivisions	1,089		1		—		—		1,089		1		2
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	1,550		5		331		5		1,881		10		2
Equity securities	—		—		1,220		66		1,220		66		1
	$	10,356	$	369	$	9,301	$	759	$	19,657	$	1,128	35

There were no securities held-to-maturity with unrealized losses as of June 30, 2016.

A summary of securities available-for-sale with unrealized losses as of December 31, 2015, along with the related fair value, aggregated by the length of time that investments have been in a continuous unrealized loss position, is as follows (dollars in thousands):



	Less than 12 months				12 months or longer				Total
December 31, 2015	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Total Securities in a Loss Position
Fixed maturities
Corporate debt securities	$	18,205	$	821	$	3,783	$	907	$	21,988	$	1,728	44
Mortgage backed securities	9,069		161		675		63		9,744		224		20
Private label asset backed securities	4,962		379		84		1		5,046		380		10
Obligations of state and political subdivisions	1,920		36		331		11		2,251		47		5
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	6,131		70		1,452		26		7,583		96		12
Equity securities	—		—		1,173		113		1,173		113		1
	$	40,287	$	1,467	$	7,498	$	1,121	$	47,785	$	2,588	92

There were no securities held-to-maturity with unrealized losses as of December 31, 2015.

The Company conducts periodic reviews to identify and evaluate securities in an unrealized loss position in order to identify other-than-temporary impairments. For securities in an unrealized loss position, the Company assesses whether the Company has the intent to sell the security or more-likely-than-not will be required to sell the security before the anticipated recovery. If either of these conditions is met, the Company is required to recognize an other-than-temporary impairment with the entire unrealized loss reported in earnings. For securities in an unrealized loss position that do not meet these conditions, the Company assesses whether the impairment of a security is other-than-temporary. If the impairment is determined to be other-than-temporary, the Company is required to separate the other-than-temporary impairments into two components: the amount representing the credit loss and the amount related to all other factors. The credit loss is the portion of the amortized book value in excess of the net present value of the projected future cash flows discounted at the effective interest rate implicit in the debt security prior to impairment. The credit loss component of other-than-temporary impairments is reported in earnings, whereas the amount relating to factors other than credit losses are recorded in other comprehensive income, net of taxes.

Management has evaluated each security in a significant unrealized loss position. The Company has no material exposure to sub-prime mortgage loans and approximately 5.6% of the fixed income investment portfolio is rated below investment grade. In evaluating whether or not the equity loss positions were other-than-temporary impairments, Management evaluated financial information on each company and where available, reviewed analyst reports from at least two independent sources. Based on a review of the available financial information, the prospect for future earnings of each company and consideration of the Company’s intent and ability to hold the securities until market values recovered, it was determined that the securities in an accumulated loss position in the portfolio were temporary impairments.

For the six months ended June 30, 2016 and year ended December 31, 2015, the Company realized no other-than-temporary impairments. At June 30, 2016, the single largest loss not realized as an impairment was in the bond portfolio and totaled $186,000. The second largest loss position was in the bond portfolio and totaled $155,000. The third largest loss position was in the bond portfolio and totaled $148,000. At December 31, 2015, the single largest loss not realized as an impairment was in the bond portfolio and totaled $252,000. The second largest loss position was in the bond portfolio and totaled $211,000. The third largest loss position was in the bond portfolio and totaled $186,000.

Major categories of investment income are summarized as follows (dollars in thousands):



	Three months ended June 30,					Six months ended June 30,
	2016		2015			2016		2015
Fixed maturities	$	948	$	868		$	1,849	$	1,762
Equity securities	26		30			54		60
Mortgage loans on real estate	6		4			7		8
Investment real estate	2		2			4		4
Policy loans	32		30			64		59
Company owned life insurance change in surrender value	19		(96		)	53		(52		)
Other	26		33			75		75
	1,059		871			2,106		1,916
Less: Investment expenses	30		58			86		101
Net investment income	$	1,029	$	813		$	2,020	$	1,815

Major categories of realized investment gains and losses are summarized as follows (dollars in thousands):



	Three months ended June 30,						Six months ended June 30,
	2016			2015			2016			2015
Fixed maturities	$	243		$	250		$	260		$	392
Other, principally real estate	(1		)	(5		)	(11		)	(5		)
Net realized investment gains	$	242		$	245		$	249		$	387

An analysis of the net change in unrealized appreciation on available-for-sale securities follows (dollars in thousands):



	June 30, 2016			December 31, 2015
Net change in unrealized appreciation on available-for-sale securities before deferred tax	$	3,466		$	(3,225	)
Deferred income tax	(1,178		)	1,097
Net change in unrealized appreciation on available-for-sale securities	$	2,288		$	(2,128	)