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Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Dec. 31, 2018	Mar. 12, 2019	Jun. 30, 2018
Document And Entity Information
Entity Registrant Name	KINGSTONE COMPANIES, INC.
Entity Central Index Key	0000033992
Document Type	10-K
Document Period End Date	Dec. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Entity Public Float			$ 163,449,432
Entity Common Stock, Shares Outstanding		10,760,042
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2018

Consolidated Balance Sheets - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Assets
Fixed-maturity securities, held-to-maturity, at amortized cost (fair value of $4,426,416 at December 31, 2018 and $5,150,076 at December 31, 2017)	$ 4,222,855	$ 4,869,808
Fixed-maturity securities, available-for-sale, at fair value (amortized cost of $155,431,261 at December 31, 2018 and $119,122,106 at December 31, 2017)	151,777,517	119,988,256
Equity securities, at fair value (cost of $18,305,986 at December 31, 2018 and $13,761,841 at December 31, 2017)	16,572,616	14,286,198
Other investments	1,855,225	0
Total investments	174,428,213	139,144,262
Cash and cash equivalents	21,138,403	48,381,633
Investment subscription receivable	0	2,000,000
Premiums receivable, net	13,961,599	13,217,698
Reinsurance receivables, net	26,367,115	28,519,130
Deferred policy acquisition costs	17,907,737	14,847,236
Intangible assets, net	670,000	1,010,000
Property and equipment, net	6,056,929	4,772,577
Deferred income tax	354,233	0
Other assets	5,867,850	2,655,527
Total assets	266,752,079	254,548,063
Liabilities
Loss and loss adjustment expense reserves	56,197,106	48,799,622
Unearned premiums	79,032,131	65,647,663
Advance premiums	2,107,629	1,477,693
Reinsurance balances payable	1,933,376	2,563,966
Deferred ceding commission revenue	2,686,677	4,266,412
Accounts payable, accrued expenses and other liabilities	6,819,231	7,487,654
Income taxes payable	15,035	0
Deferred income taxes	0	600,342
Long-term debt, net	29,295,251	29,126,965
Total liabilities	178,086,436	159,970,317
Commitments and Contingencies
Stockholders' Equity
Preferred stock, $.01 par value; authorized 2,500,000 shares	0	0
Common stock, $.01 par value; authorized 20,000,000 shares; issued 11,775,148 shares at December 31, 2018 and 11,618,646 at December 31, 2017; outstanding 10,747,709 shares at December 31, 2018 and 10,631,837 shares at December 31, 2017	117,751	116,186
Capital in excess of par	67,763,940	68,380,390
Accumulated other comprehensive income	(2,884,313)	1,100,647
Retained earnings	26,380,816	27,152,822
Total	91,378,194	96,750,045
Treasury stock, at cost, 1,027,439 shares at December 31, 2018 and 986,809 shares at December 31, 2017	(2,712,552)	(2,172,299)
Total stockholders' equity	88,665,642	94,577,746
Total liabilities and stockholders' equity	$ 266,752,078	$ 254,548,063

Consolidated Balance Sheets (Parenthetical) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Deferred Acquisition Costs And Deferred Ceding Commission Revenue Details 1
Fixed-maturity securities, held to maturity, fair value	$ 4,426,416	$ 5,150,076
Fixed-maturity securities, available for sale, amortized cost	155,431,261	119,122,106
Equity securities, available-for-sale, cost	$ 18,305,986	$ 13,761,841
Stockholders' Equity
Preferred stock,par value	$ 0.01	$ 0.01
Preferred stock,authorized shares	2,500,000	2,500,000
Common stock, par value	$ 0.01	$ 0.01
Common stock, authorized shares	20,000,000	20,000,000
Common stock, issued shares	11,775,148	11,618,646
Common stock, outstanding shares	10,747,709	10,631,837
Treasury stock, Shares	1,027,439	986,809

Consolidated Statements of Income and Comprehensive Income - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Revenues
Net premiums earned	$ 103,414,715	$ 77,351,023
Ceding commission revenue	5,332,630	9,933,133
Net investment income	6,186,248	4,132,586
Net (losses) gains on investments	(2,495,857)	84,313
Other income	1,334,162	1,268,255
Total revenues	113,771,898	92,769,310
Expenses
Loss and loss adjustment expenses	58,295,205	34,185,537
Commission expense	25,342,137	21,182,254
Other underwriting expenses	20,943,342	18,115,614
Other operating expenses	2,575,404	3,512,927
Depreciation and amortization	1,787,150	1,402,928
Interest expense	1,821,597	60,335
Total expenses	110,764,835	78,459,595
Income from operations before taxes	3,007,063	14,309,715
Income tax expense	(86,183)	4,323,230
Net income	3,093,246	9,986,485
Other comprehensive income (loss), net of tax
Gross change in unrealized (losses) gains on available-for-sale-securities	(4,984,149)	1,364,319
Reclassification adjustment for losses (gains) included in net income	464,254	(84,313)
Net change in unrealized (losses) gains	(4,519,895)	1,280,006
Income tax benefit (expense) related to items of other comprehensive (loss) income	949,177	(435,202)
Other comprehensive (loss) income, net of tax	(3,570,718)	844,804
Comprehensive (loss) income	$ (477,472)	$ 10,831,289
Earnings per common share:
Basic	$ 0.29	$ 0.96
Diluted	$ 0.29	$ 0.94
Weighted average common shares outstanding
Basic	10,686,813	10,388,440
Diluted	10,716,886	10,581,577
Dividends declared and paid per common share	$ 0.4	$ 0.3025

Consolidated Statement of Stockholders' Equity - USD ($)	Preferred Stock	Common Stock	Capital in Excess of Par	Accumulated Other Comprehensive Income (Loss)	Retained Earnings	Treasury Stock	Total
Beginning Balance, Amount at Dec. 31, 2016	$ 0	$ 88,963	$ 37,950,401	$ 72,931	$ 20,563,720	$ (1,995,462)	$ 56,680,553
Beginning Balance, Shares at Dec. 31, 2016	0	8,896,335				974,469
Proceeds from public offering, net of offering costs of $2,173,000, Shares		2,692,500
Proceeds from public offering, net of offering costs of $2,173,000, Amount		$ 26,925	30,109,774				30,136,699
Stock-based compensation, Amount			270,231				270,231
Vesting of restricted stock awards, Shares		12,311
Vesting of restricted stock awards, Amount		$ 123	(123)				0
Shares deducted from restricted stock awards for payment of withholding taxes, Shares		(1,730)
Shares deducted from restricted stock awards for payment of withholding taxes, Amount		$ (18)	(27,627)				(27,645)
Exercise of stock options, Shares		19,230
Exercise of stock options, Amount		$ 193	77,734				$ 77,927
Acquisition of treasury stock, Amount						$ 12,340
Acquisition of treasury stock, Shares						(176,837)	(176,837)
Dividends					(3,214,471)		$ (3,214,471)
Net income					9,986,485		9,986,485
Other comprehensive loss							844,804
Change in unrealized gains on available for sale securities, net of tax				844,804			844,804
Reclassify stranded tax effects from accumulated other comprehensive income to retained earnings				182,912	(182,912)
Ending Balance, Amount at Dec. 31, 2017	$ 0	$ 116,186	68,380,390	1,100,647	27,152,822	$ (2,172,299)	94,577,746
Ending Balance, Shares at Dec. 31, 2017	0	11,618,646				986,809
Cumulative effect of adoption of updated accounting guidance for equity financial instruments at January 1, 2018				(414,242)	414,242
Stock-based compensation, Amount			702,650				702,650
Shares deducted from exercise of stock options for payment of withholding taxes, Shares		(72,063)
Shares deducted from exercise of stock options for payment of withholding taxes, Amount		$ (719)	(1,356,452)				(1,357,171)
Vesting of restricted stock awards, Shares		19,482
Vesting of restricted stock awards, Amount		$ 190	(190)
Shares deducted from restricted stock awards for payment of withholding taxes, Shares		(2,877)
Shares deducted from restricted stock awards for payment of withholding taxes, Amount		$ (29)	(50,975)				(51,004)
Exercise of stock options, Shares		211,960
Exercise of stock options, Amount		$ 2,123	88,517				90,640
Acquisition of treasury stock, Amount						$ (540,253)	(540,253)
Acquisition of treasury stock, Shares						40,630
Dividends					(4,279,494)		(4,279,494)
Net income					3,093,246		3,093,246
Other comprehensive loss				(3,570,718)			(3,570,718)
Ending Balance, Amount at Dec. 31, 2018	$ 0	$ 117,751	$ 67,763,940	$ (2,884,313)	$ 26,380,816	$ (2,712,552)	$ 88,665,642
Ending Balance, Shares at Dec. 31, 2018	0	11,775,148				1,027,439

Condensed Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net income	$ 3,093,246	$ 9,986,485
Adjustments to reconcile net income to net cash flows provided by operating activities:
Net losses (gains) on sale of investments	93,974	(84,313)
Unrealized losses of equity investments	2,257,727	0
Net unrealized losses of other investments	144,156	0
Depreciation and amortization	1,787,150	1,402,928
Amortization of bond premium, net	373,014	548,846
Amortization of discount and issuance costs on long-term debt	168,286	5,335
Stock-based compensation	702,650	270,231
Deferred income tax benefit	(5,398)	(1,809)
(Increase) decrease in operating assets:
Premiums receivable, net	(743,901)	(1,568,300)
Reinsurance receivables, net	2,152,015	3,678,635
Deferred policy acquisition costs	(3,060,501)	(2,607,455)
Other assets	(3,215,227)	(1,228,493)
Increase (decrease) in operating liabilities:
Loss and loss adjustment expense reserves	7,397,484	7,062,903
Unearned premiums	13,384,468	10,653,288
Advance premiums	629,936	56,133
Reinsurance balances payable	(630,590)	417,949
Deferred ceding commission revenue	(1,579,735)	(2,585,429)
Accounts payable, accrued expenses and other liabilities	(653,388)	2,039,206
Net cash flows provided by operating activities	22,295,366	28,046,140
Cash flows from investing activities:
Purchase - fixed-maturity securities held-to-maturity	0	(121,271)
Purchase - fixed-maturity securities available-for-sale	(58,542,741)	(50,396,228)
Purchase - equity securities available-for-sale	(13,380,542)	(7,526,326)
Sale and redemption - fixed-maturity securities held-to-maturity	624,963	247,500
Sale or maturity - fixed-maturity securities available-for-sale	21,381,668	11,132,000
Sale - equity securities available-for-sale	9,246,840	3,862,127
Investment subscription receivable		(2,000,000)
Acquisition of fixed assets	(2,731,502)	(2,824,132)
Net cash flows used in investing activities	(43,401,314)	(47,626,330)
Cash flows from financing activities:
Net proceeds from issuance of common stock	0	30,136,699
Net proceeds from issuance of long-term debt	0	29,121,630
Proceeds from exercise of stock options	90,640	77,927
Withholding taxes paid on net exercise of stock options	(1,357,171)	0
Withholding taxes paid on net exercise of stock options	(51,004)	(27,645)
Purchase of treasury stock	(540,253)	(176,837)
Dividends paid	(4,279,494)	(3,214,471)
Net cash flows provided by financing activities	(6,137,282)	55,917,303
Increase (decrease) in cash and cash equivalents	(27,243,230)	36,337,113
Cash and cash equivalents, beginning of period	48,381,633	12,044,520
Cash and cash equivalents, end of period	21,138,403	48,381,633
Supplemental disclosures of cash flow information:
Cash paid for income taxes	2,201,000	5,773,000
Cash paid for interest	$ 1,700,417	$ 0

1. Nature of Business

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

1. Nature of Business

Kingstone Companies, Inc. (referred to herein as "Kingstone" or the “Company”), through its wholly owned subsidiary, Kingstone Insurance Company (“KICO”), underwrites property and casualty insurance to small businesses and individuals exclusively through independent agents and brokers. KICO is a licensed insurance company in the States of New York, New Jersey, Rhode Island, Massachusetts, Pennsylvania, Connecticut, Maine and New Hampshire. KICO is currently offering its property and casualty insurance products in New York, New Jersey, Rhode Island, Massachusetts and Pennsylvania. Although New Jersey, Rhode Island and Massachusetts are now growing expansion markets for the Company, 93.7% and 98.5% of KICO’s direct written premiums for the years ended December 31, 2018 and 2017, respectively, came from the New York policies.

2. Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Principles of Consolidation

The consolidated financial statements consist of Kingstone and its wholly owned subsidiaries: KICO and its wholly owned subsidiaries, CMIC Properties, Inc. (“Properties”) and 15 Joys Lane, LLC (“15 Joys Lane”), which together own the land and building from which KICO operates. All significant inter-company account balances and transactions have been eliminated in consolidation.

Revenue Recognition

Net Premiums Earned

Insurance policies issued by the Company are short-duration contracts. Accordingly, premium revenues, net of premiums ceded to reinsurers, are recognized as earned in proportion to the amount of insurance protection provided, on a pro-rata basis over the terms of the underlying policies. Unearned premiums represent premiums applicable to the unexpired portions of in-force insurance contracts at the end of each year.

Ceding Commission Revenue

Commissions on reinsurance premiums ceded are earned in a manner consistent with the recognition of the costs of the reinsurance, generally on a pro-rata basis over the terms of the policies reinsured. Unearned amounts are recorded as deferred ceding commission revenue. Certain reinsurance agreements contain provisions whereby the ceding commission rates vary based on the loss experience under the agreements. The Company records ceding commission revenue based on its current estimate of subject losses. The Company records adjustments to ceding commission revenue in the period that changes in the estimated losses are determined.

Loss and Loss Adjustment Expenses (“LAE”) Reserves

The liability for loss and LAE represents management’s best estimate of the ultimate cost of all reported and unreported losses that are unpaid as of the balance sheet date. The liability for loss and LAE is estimated on an undiscounted basis, using individual case-basis valuations, statistical analyses and various actuarial reserving methodologies. The projection of future claim payment and reporting is based on an analysis of the Company’s historical experience, supplemented by analyses of industry loss data. Management believes that the reserves for loss and LAE are adequate to cover the ultimate cost of losses and claims to date; however, because of the uncertainty from various sources, including changes in reporting patterns, claims settlement patterns, judicial decisions, legislation, and economic conditions, actual loss experience may not conform to the assumptions used in determining the estimated amounts for such liability at the balance sheet date. Adjustments to these estimates are reflected in expense for the period in which the estimates are changed. Because of the nature of the business historically written, management believes that the Company has limited exposure to environmental claim liabilities.

Reinsurance

In the normal course of business, the Company seeks to reduce the loss that may arise from catastrophes or other events that cause unfavorable underwriting results. This is done by reinsuring certain levels of risk in various areas of exposure with a panel of financially secure reinsurance carriers.

Reinsurance receivables represents management’s best estimate of paid and unpaid loss and LAE recoverable from reinsurers, and ceded losses receivable and unearned ceded premiums under reinsurance agreements. Ceded losses receivable are estimated using techniques and assumptions consistent with those used in estimating the liability for loss and LAE. Management believes that reinsurance receivables as recorded represent its best estimate of such amounts; however, as changes in the estimated ultimate liability for loss and LAE are determined, the estimated ultimate amount receivable from the reinsurers will also change. Accordingly, the ultimate receivable could be significantly in excess of or less than the amount recorded in the consolidated financial statements. Adjustments to these estimates are reflected in the period in which the estimates are changed. Loss and LAE incurred as presented in the consolidated statements of income and comprehensive (loss) income are net of reinsurance recoveries.

Management has evaluated its reinsurance arrangements and determined that significant insurance risk is transferred to the reinsurers. Reinsurance agreements have been determined to be short-duration prospective contracts and, accordingly, the costs of the reinsurance are recognized over the life of the contract in a manner consistent with the earning of premiums on the underlying policies subject to the reinsurance contract.

Management estimates uncollectible amounts receivable from reinsurers based on an assessment of factors including the creditworthiness of the reinsurers and the adequacy of collateral obtained, where applicable. There was no allowance for uncollectible reinsurance as of December 31, 2018 and 2017. The Company did not expense any uncollectible reinsurance for the years ended December 31, 2018 and 2017. Significant uncertainties are inherent in the assessment of the creditworthiness of reinsurers and estimates of any uncollectible amounts due from reinsurers. Any change in the ability of the Company’s reinsurers to meet their contractual obligations could have a material adverse effect on the consolidated financial statements as well as KICO’s ability to meet its regulatory capital and surplus requirements.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The Company maintains its cash balances at several financial institutions.

Investments

The Company classifies its fixed-maturity securities as either held-to-maturity or available-for-sale. Effective January 1, 2018, the Company adopted ASU 2016-01, which resulted in changes in the estimated fair value of equity securities and other investments held at December 31, 2018 being reported in net income instead of other comprehensive income (loss). For additional discussion, see Note 2, Accounting Policies. The Company may sell its available-for-sale securities, equity securities, and other investments in response to changes in interest rates, risk/reward characteristics, liquidity needs or other factors. Fixed-maturity securities that the Company has the specific intent and ability to hold until maturity are classified as such and carried at amortized cost.

Available-for-sale securities are reported at their estimated fair values based on quoted market prices from a recognized pricing service, with unrealized gains and losses, net of tax effects, reported as a separate component of accumulated other comprehensive income (loss). Realized gains and losses are determined on the specific identification method and reported in net income in the consolidated statements of income and comprehensive income (loss).

Equity securities are reported at their estimated fair values based on quoted market prices from recognized pricing services, with unrealized gains and losses reported in net income. Other investments are reported at their estimated fair values using the net asset value (“NAV”) per share (or its equivalent) of the instrument with unrealized gains and losses reported in net income. See Note 3, Investments for additional discussion.

Investment income is accrued to the balance sheet dates of the consolidated financial statements and includes amortization of premium and accretion of discount on fixed-maturity securities. Interest is recognized when earned, while dividends are recognized when declared. Due and accrued investment income totaled approximately $1,721,000 and $1,136,000 as of December 31, 2018 and 2017, respectively, and is included in other assets on the accompanying consolidated balance sheets.

Premiums Receivable

Premiums receivable include balances due currently or in the future and are presented net of an allowance for doubtful accounts of approximately $255,000 and $291,000 as of December 31, 2018 and 2017, respectively. The allowance for uncollectible amounts is based on an analysis of amounts receivable giving consideration to historical loss experience and current economic conditions and reflects an amount that, in management’s judgment, is adequate. Uncollectible premiums receivable balances of approximately $252,000 and $138,000 were written off for the years ended December 31, 2018 and 2017, respectively.

Deferred Policy Acquisition Costs

Policy acquisition costs represent the costs of writing business that vary with, and are primarily related to, the successful production of insurance business (principally commissions, premium taxes and certain underwriting salaries). Policy acquisition costs are deferred and recognized as expense as related premiums are earned.

Intangible Assets

The Company has recorded acquired identifiable intangible assets. The cost of a group of assets acquired in a transaction is allocated to the individual assets including identifiable intangible assets based on their fair values. Identifiable intangible assets with a finite useful life are amortized over the period that the asset is expected to contribute directly or indirectly to the future cash flows of the Company. Intangible assets with an indefinite life are not amortized, but are subject to impairment testing if events or changes in circumstances indicate that it is more likely than not the asset is impaired. All identifiable intangible assets are tested for recoverability whenever events or changes in circumstances indicate that a carrying amount may not be recoverable. No impairment losses from intangible assets were recognized for the years ended December 31, 2018 and 2017.

Property and Equipment

Building and building improvements, automobiles, furniture, computer equipment, and computer software are reported at cost less accumulated depreciation. Depreciation is provided using the straight-line method over the estimated useful lives of the assets. The Company estimates the useful life for computer equipment, computer software, automobiles, furniture and other equipment is three years, and building and building improvements is 39 years.

The Company reviews its real estate assets used as its headquarters to evaluate the necessity of recording impairment losses for market changes due to declines in the estimated fair value of the property. In evaluating potential impairment, management considers the current estimated fair value compared to the carrying value of the asset. At December 31, 2018 and 2017, the fair value of the real estate assets is estimated to be in excess of the carrying value.

Income Taxes

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company files a consolidated tax return with its subsidiaries. At December 31, 2018, the Company had no material unrecognized tax benefits and no adjustments to liabilities or operations were required.

On December 22, 2017, the Tax Cuts and Jobs Act of 2017 was enacted (see Note 15 - Income Taxes).

Assessments

Insurance related assessments are accrued in the period in which they have been incurred. A typical obligating event would be the issuance of an insurance policy or the occurrence of a claim. The Company is subject to a variety of assessments.

Concentration and Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk are primarily cash and cash equivalents, investments, and premium and reinsurance receivables. Investments are diversified through many industries and geographic regions based upon KICO’s Investment Committee’s guidelines, which employs a variety of investment strategies. The Company believes that no significant concentration of credit risk exists with respect to investments. At times, cash may be uninsured or in deposit accounts that exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance limits. The Company has not experienced any losses in such accounts and management believes the Company is not exposed to any significant credit risk. Cash equivalents are not insured by the FDIC.

As of December 31, 2018 and 2017, the Company’s cash equivalents were as follows:

	December 31,		December 31,
	2018		2017

Collateralized bank repurchase agreement (1)	$	568,123	$	10,249,985
Money market funds		15,012,559		35,874,700
Total	$	15,580,682	$	46,124,685

(1) The Company has a security interest in certain of the bank's holdings of direct obligations of the United States or one or more agencies thereof. The collateral is held in a hold-in-custody arrangement with a third party who maintains physical possession of the collateral on behalf of the bank.

At December 31, 2018, the outstanding premiums receivable balance is generally diversified due to the large number of individual insureds comprising the Company’s customer base. The Company’s customer base is concentrated in the New York City metropolitan area. The Company also has receivables from its reinsurers.

Reinsurance contracts do not relieve the Company of its obligations to policyholders. Failure of reinsurers to honor their obligations could result in losses to the Company. The Company periodically evaluates the financial condition of its reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. See Note 7 for reinsurance recoverables on unpaid and paid losses by reinsurer. Management’s policy is to review all outstanding receivables quarterly as well as the bad debt write-offs experienced in the past and establish an allowance for doubtful accounts, if deemed necessary.

Direct premiums earned from lines of business in excess of 10% of the total subject the Company to concentration risk for the years ended December 31, 2018 and 2017 as follows:

	Years ended December 31,
	2018			2017
Personal Lines		80.7	%		77.2	%
Commercial Lines		11.6	%		12.2	%
Livery physical damage		n/a			10.3	%
Total premiums earned subject to concentration		92.3	%		99.7	%
Premiums earned not subject to concentration		7.7	%		0.3	%
Total premiums earned		100.0	%		100.0	%

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The actual results could differ from these estimates and assumptions, which include the reserves for losses and loss adjustment expenses, which are subject to estimation errors due to the inherent uncertainty in projecting ultimate claim amounts that will be reported and settled over a period of many years. In addition, estimates and assumptions associated with receivables under reinsurance contracts related to contingent ceding commission revenue require judgments by management. On an on-going basis, management reevaluates its assumptions and the methods for calculating these estimates. Actual results may differ significantly from the estimates and assumptions used in preparing the consolidated financial statements.

Earnings per share

Basic earnings per common share is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings per common share reflect, in periods in which they have a dilutive effect, the impact of common shares issuable upon the exercise of stock options as well as non-vested restricted stock awards. The computation of diluted earnings per share excludes those options with an exercise price in excess of the average market price of the Company’s common shares during the periods presented. Additionally, the computation of diluted earnings per share excludes unvested restricted stock awards as calculated using the treasury stock method.

Advertising Costs

Advertising costs are charged to operations when the advertising is initiated. Advertising costs are included in other underwriting expenses in the accompanying consolidated statements of income and comprehensive income (loss), and were approximately $173,000 and $202,000 for the years ended December 31, 2018 and 2017, respectively.

Stock-based Compensation

Stock-based compensation expense in 2018 and 2017 is the estimated fair value of restricted stock awards and options granted, amortized on a straight-line basis over the requisite service period for the entire portion of the award less an estimate for anticipated forfeitures. The Company uses the “simplified” method to estimate the expected term of the options because the Company’s historical share option exercise experience does not provide a reasonable basis upon which to estimate expected term.

Compensated Absences

Employees of the Company are entitled to paid vacations, sick days, and other time off depending on job classification, length of service and other factors. It is impracticable to estimate the amount of compensation of future absences and, accordingly, no liability has been recorded in the accompanying consolidated financial statements. The Company’s policy is to recognize the cost of compensated absences when paid to employees.

Comprehensive Income (Loss)

Comprehensive income (loss) refers to revenues, expenses, gains and losses that are included in comprehensive income (loss) but are excluded from net income as these amounts are recorded directly as an adjustment to stockholders' equity, primarily from changes in unrealized gains and losses on available-for-sale securities, and related income taxes.

Accounting Changes

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 – Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). The core principle of the new guidance is that an entity should recognize revenue to reflect the transfer of goods and services to customers in an amount equal to the consideration the entity receives or expects to receive. The Company adopted ASU 2014-09 effective January 1, 2018. The standard excludes from its scope the accounting for insurance contracts, financial instruments, and certain other agreements that are governed under other GAAP guidance. Accordingly, the adoption of ASU 2014-09, as amended, did not have a material impact on the Company’s consolidated financial statements.

In January 2016, the FASB issued ASU 2016-01 – Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”). Effective January 1, 2018, the Company adopted the provisions of ASU 2016-01. The updated guidance requires equity investments, including limited partnership interests, except those accounted for under the equity method of accounting, that have a readily determinable fair value to be measured at fair value with any changes in fair value recognized in net income. Equity securities that do not have readily determinable fair values may be measured at estimated fair value or cost less impairment, if any, adjusted for subsequent observable price changes, with changes in the carrying value recognized in net income. A qualitative assessment for impairment is required for equity investments without readily determinable fair values. The updated guidance also eliminates the requirement to disclose the method and significant assumptions used to estimate the fair value of financial instruments measured at amortized cost on the balance sheet. The adoption of this guidance resulted in the recognition of approximately $414,000 of net after-tax unrealized gains on equity investments as a cumulative effect adjustment that increased retained earnings as of January 1, 2018 and decreased accumulated other comprehensive income (loss) (“AOCI”) by the same amount. The Company elected to report changes in the fair value of equity investments in net gains (losses) on investments in the consolidated statements of income and comprehensive income (loss). At December 31, 2017, equity investments were classified as available-for-sale on the Company's consolidated balance sheet. However, upon adoption, the updated guidance eliminated the available-for-sale balance sheet classification for equity investments. Furthermore, for the year ended December 31, 2018, net loss on investments of approximately $2,496,000 recorded in the consolidated statements of income and comprehensive income (loss) includes net losses of approximately $2,402,000 from the estimated fair value change of equity securities and other investments.

In August 2016, the FASB issued ASU 2016-15 – Statement of Cash Flows (Topic 320): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”). The revised ASU provides accounting guidance for eight specific cash flow issues. The FASB issued the standard to clarify areas where GAAP has been either unclear or lacking in specific guidance. The Company adopted this ASU effective January 1, 2018, and it did not have a material impact on the Company’s consolidated financial statements.

In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting (“ASU 2017-09”). ASU 2017-09 clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. The Company adopted this ASU effective January 1, 2018 on a prospective basis and it did not have a material impact on the Company’s consolidated financial statements.

In February 2018, the FASB issued ASU 2018-02 - Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”). The deferred income tax liability for unrealized gains on available-for-sale securities that were re-measured due to the reduction in corporate income tax rates under the Tax Cuts and Jobs Act of 2017 (the “Tax Act”) resulted in a stranded tax effect within AOCI. This is due to the effect of the tax rate change being recorded through continuing operations as required under Accounting Standards Codification 740 (“ASC 740”). The revised ASU allows for the reclassification of the stranded tax effects as a result of the Act from AOCI to retained earnings and requires certain other disclosures. Effective December 31, 2017, the Company chose to early adopt the provisions of ASU 2018-02 and recorded a one-time reclassification of $182,912 from AOCI to retained earnings for the stranded tax effects resulting from the newly enacted corporate tax rate. The amount of the reclassification was the difference between the historical corporate tax rate and the newly enacted 21% corporate tax rate.

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02 – Leases (Topic 842) (“ASU 2016-02”). Under this ASU, lessees will recognize a right-of-use-asset and corresponding liability on the balance sheet for all leases, except for leases covering a period of fewer than 12 months. The liability is to be measured as the present value of the future minimum lease payments taking into account renewal options if applicable plus initial incremental direct costs such as commissions. The minimum payments are discounted using the rate implicit in the lease or, if not known, the lessee’s incremental borrowing rate. The lessee’s income statement treatment for leases will vary depending on the nature of what is being leased. A financing type lease is present when, among other matters, the asset is being leased for a substantial portion of its economic life or has an end-of-term title transfer or a bargain purchase option as in today’s practice. The payment of the liability set up for such leases will be apportioned between interest and principal; the right-of use asset will be generally amortized on a straight-line basis. If the lease does not qualify as a financing type lease, it will be accounted for on the income statement as rent on a straight-line basis. The Company will be adopting ASU 2016-02 effective January 1, 2019. Under the new lease guidance, the Company’s assets and liabilities will increase by approximately $960,000 primarily related to an operating lease for office space. The Company does not expect material changes to the consolidated statements of income and comprehensive (loss) income.

In June 2016, FASB issued ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). The revised accounting guidance requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts and requires enhanced disclosures related to the significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. In addition, ASU 2016-13 amends the accounting for credit losses of available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 will be effective on January 1, 2020. The Company is currently evaluating the effect the updated guidance will have on its consolidated financial statements.

In August 2018, the Securities and Exchange Commission (the “SEC”) adopted the final rule under SEC Release No. 33-10532, “Disclosure Update and Simplification,” amending certain disclosure requirements that were redundant, duplicative, overlapping, outdated or superseded. In addition, the amendments expanded the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The analysis should present a reconciliation of the beginning balance to the ending balance of each period for which a statement of comprehensive income is required to be filed. This final rule is effective on November 5, 2018. The Company is evaluating the impact of this guidance on its consolidated financial statements. The Company anticipates its first presentation of changes in stockholders’ equity will be included in its Form 10-Q for the quarter ending March 31, 2019.

The Company has determined that all other recently issued accounting pronouncements will not have a material impact on its consolidated financial position, results of operations and cash flows, or do not apply to its operations.

3. Investments

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

3. Investments

Available-for-Sale Securities

The amortized cost and estimated fair value of investments in available-for-sale fixed-maturity securities as of December 31, 2018 and December 31, 2017 are summarized as follows:

	December 31, 2018
														Net
		Cost or		Gross		Gross Unrealized Losses						Estimated		Unrealized
		Amortized		Unrealized		Less than 12			More than 12			Fair		Gains/
Category		Cost		Gains		Months			Months			Value		(Losses)

Fixed-Maturity Securities:
U.S. Treasury securities and
obligations of U.S. government
corporations and agencies		$	8,222,050	$	26,331	$	(28,000	)	$	-		$	8,220,381	$	(1,669	)

Political subdivisions of States,
Territories and Possessions			6,339,540		50,903		(12,327	)		(36,508	)		6,341,608		2,068

Corporate and other bonds
Industrial and miscellaneous			119,078,698		123,740		(2,775,540	)		(676,605	)		115,750,293		(3,328,405	)

Residential mortgage and other
asset backed securities (1)			21,790,973		236,502		(231,229	)		(331,012	)		21,465,234		(325,739	)
Total		$	155,431,261	$	437,476	$	(3,047,096	)	$	(1,044,125	)	$	151,777,516	$	(3,653,745	)

(1)

In 2017, KICO placed certain residential mortgage backed securities as eligible collateral in a designated custodian account related to its membership in the Federal Home Loan Bank of New York ("FHLBNY") (See Note 9). The eligible collateral would be pledged to FHLBNY if KICO draws an advance from the FHBLNY credit line. As of December 31, 2018, the estimated fair value of the eligible investments was approximately $5,116,000. KICO will retain all rights regarding all securities if pledged as collateral. As of December 31, 2018, there was no outstanding balance on the FHLBNY credit line.

	December 31, 2017
													Net
	Cost or		Gross		Gross Unrealized Losses						Estimated		Unrealized
	Amortized		Unrealized		Less than 12			More than 12			Fair		Gains/
Category	Cost		Gains		Months			Months			Value		(Losses)

Fixed-Maturity Securities:
Political subdivisions of States,
Territories and Possessions	$	11,096,122	$	250,135	$	(30,814	)	$	-		$	11,315,443	$	219,321

Corporate and other bonds
Industrial and miscellaneous		87,562,631		1,189,207		(269,857	)		(340,516	)		88,141,465		578,834

Residential mortgage and other
asset backed securities (1)		20,463,353		305,499		(48,482	)		(189,022	)		20,531,348		67,995
Total	$	119,122,106	$	1,744,841	$	(349,153	)	$	(529,538	)	$	119,988,256	$	866,150

(1)

In 2017, KICO placed certain residential mortgage backed securities as eligible collateral in a designated custodian account related to its membership in the FHLBNY (see Note 9). The eligible collateral would be pledged to FHLBNY if KICO draws an advance from the FHBLNY credit line. As of December 31, 2017, the estimated fair value of the eligible investments was approximately $6,703,000. KICO will retain all rights regarding all securities if pledged as collateral. As of December 31, 2017, there was no outstanding balance on the FHLBNY credit line.

A summary of the amortized cost and estimated fair value of the Company’s investments in available-for-sale fixed-maturity securities by contractual maturity as of December 31, 2018 and 2017 is shown below:

The actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without penalties.

	December 31, 2018				December 31, 2017
	Amortized		Estimated		Amortized		Estimated
Remaining Time to Maturity	Cost		Fair Value		Cost		Fair Value

Less than one year	$	6,742,519	$	6,738,014	$	2,585,479	$	2,595,938
One to five years		47,038,838		46,640,012		31,716,345		32,065,197
Five to ten years		76,884,505		74,290,076		62,702,945		63,129,543
More than ten years		2,974,426		2,644,180		1,653,984		1,666,230
Residential mortgage and other asset backed securities		21,790,973		21,465,234		20,463,353		20,531,348
Total	$	155,431,261	$	151,777,516	$	119,122,106	$	119,988,256

Equity Securities

The cost, estimated fair value, and gross gains and losses of investments in equity securities as of December 31, 2018 and 2017 are as follows:

	December 31, 2018
			Gross		Gross			Estimated
Category	Cost		Gains		Losses			Fair Value

Equity Securities:
Preferred stocks	$	6,694,754	$	-	$	(541,798	)	$	6,152,956
Common stocks and exchange
traded mutual funds		11,611,232		99,817		(1,291,389	)		10,419,660
Total	$	18,305,986	$	99,817	$	(1,833,187	)	$	16,572,616

	December 31, 2017
			Gross		Gross			Estimated
Category	Cost		Gains		Losses			Fair Value

Equity Securities:
Preferred stocks	$	7,081,099	$	60,867	$	(141,025	)	$	7,000,941
Common stocks and exchange
traded mutual funds		6,680,742		841,250		(236,735	)		7,285,257
Total	$	13,761,841	$	902,117	$	(377,760	)	$	14,286,198

Other Investments

The cost, estimated fair value, and gross losses of the Company’s other investments as of December 31, 2018 and, 2017 are as follows:

	December 31, 2018							December 31, 2017
			Gross			Estimated				Gross		Estimated
Category	Cost		Losses			Fair Value		Cost		Gains/(Losses)		Fair Value

Other Investments:
Hedge fund	$	1,999,381	$	(144,156	)	$	1,855,225	$	-	$	-	$	-
Total	$	1,999,381	$	(144,156	)	$	1,855,225	$	-	$	-	$	-

Held-to-Maturity Securities

The amortized cost and estimated fair value of investments in held-to-maturity fixed-maturity securities as of December 31, 2018 and 2017 are summarized as follows:

	December 31, 2018

	Cost or		Gross		Gross Unrealized Losses						Estimated		Net
	Amortized		Unrealized		Less than 12			More than 12			Fair		Unrealized
Category	Cost		Gains		Months			Months			Value		Gains/(Losses)

Held-to-Maturity Securities:
U.S. Treasury securities	$	729,507	$	147,532	$	(3,964	)	$	-		$	873,075	$	143,568

Political subdivisions of States,
Territories and Possessions		998,803		33,862		-			-			1,032,665		33,862

Corporate and other bonds
Industrial and miscellaneous		2,494,545		38,461		(1,425	)		(10,905	)		2,520,676		26,131

Total	$	4,222,855	$	219,855	$	(5,389	)	$	(10,905	)	$	4,426,416	$	203,561

	December 31, 2017

	Cost or		Gross		Gross Unrealized Losses						Estimated		Net
	Amortized		Unrealized		Less than 12			More than 12			Fair		Unrealized
Category	Cost		Gains		Months			Months			Value		Gains/(Losses)

Held-to-Maturity Securities:
U.S. Treasury securities	$	729,466	$	147,573	$	(1,729	)	$	-		$	875,310	$	145,844

Political subdivisions of States,
Territories and Possessions		998,984		50,366		-			-			1,049,350		50,366

Corporate and other bonds
Industrial and miscellaneous		3,141,358		90,358		-			(6,300	)		3,225,416		84,058

Total	$	4,869,808	$	288,297	$	(1,729	)	$	(6,300	)	$	5,150,076	$	280,268

Held-to-maturity U.S. Treasury securities are held in trust pursuant to various states’ minimum fund requirements.

A summary of the amortized cost and the estimated fair value of the Company’s investments in held-to-maturity securities by contractual maturity as of December 31, 2018 and 2017 is shown below:

	December 31, 2018				December 31, 2017
	Amortized		Estimated		Amortized		Estimated
Remaining Time to Maturity	Cost		Fair Value		Cost		Fair Value

Less than one year	$	-	$	-	$	-	$	-
One to five years		2,996,685		3,036,531		2,546,459		2,601,898
Five to ten years		619,663		635,846		1,716,884		1,794,139
More than ten years		606,507		754,039		606,465		754,039
Total	$	4,222,855	$	4,426,416	$	4,869,808	$	5,150,076

The actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without penalties.

Investment Income

Major categories of the Company’s net investment income are summarized as follows:

	Years ended
	December 31,
	2018		2017

Income:
Fixed-maturity securities	$	5,316,970	$	3,664,577
Equity securities		820,827		564,071
Cash and cash equivalents		219,238		56,075
Total		6,357,035		4,284,723
Expenses:
Investment expenses		170,787		152,137
Net investment income	$	6,186,248	$	4,132,586

Proceeds from the sale and redemption of fixed-maturity securities held-to-maturity were $624,963 and $247,500 for the years ended December 31, 2018 and 2017, respectively. Proceeds from the sale and redemption of fixed-maturity securities held-to-maturity for the year ended December 31, 2017 includes one redemption of $200,000 and one sale of $47,500. The sale was to dispose of a bond issued by the Commonwealth of Puerto Rico that was deemed to have a permanent credit impairment by the Company (see Impairment Review Below).

Proceeds from the sale and maturity of fixed-maturity securities available-for-sale were $21,381,668 and $11,132,000 for the years ended December 31, 2018 and 2017, respectively.

Proceeds from the sale of equity securities were $9,246,840 and $3,862,127 for the years ended December 31, 2018 and 2017, respectively.

The Company’s net (losses) gains on investments are summarized as follows:

	Years ended
	December 31,
	2018			2017
Realized (Losses) Gains

Fixed-maturity securities:
Gross realized gains	$	117,186		$	70,478
Gross realized losses (1)		(618,699	)		(309,247	)
		(501,513	)		(238,769	)

Equity securities:
Gross realized gains		992,012			636,880
Gross realized losses		(584,473	)		(263,798	)
		407,539			373,082

Net realized (losses) gains		(93,974	)		134,313

Other-than-temporary impairment losses:
Fixed-maturity securities		-			(50,000	)

Unrealized (Losses) Gains

Equity Securities:
Gross gains		-			-
Gross losses		(2,257,727	)		-
		(2,257,727	)		-

Other investments:
Gross gains		-			-
Gross losses		(144,156	)		-
		(144,156	)		-

Net unrealized losses		(2,401,883	)		-

Net (losses) gains on investments	$	(2,495,857	)	$	84,313

(1)

Gross realized losses for the year ended December 31, 2018 includes a $23,912 loss from the redemption of a fixed-maturity security held-to-maturity. Gross realized losses for the year ended December 31, 2017 includes a $59,916 loss from the sale of a fixed-maturity security held-to-maturity issued by the Commonwealth of Puerto Rico (see impairment review below).

Impairment Review

The Company regularly reviews its fixed-maturity securities (and reviewed its equity securities portfolios prior to January 1, 2018) to evaluate the necessity of recording impairment losses as charges to operations for other-than-temporary declines in the fair value of investments. In evaluating potential impairment, GAAP specifies (i) if the Company does not have the intent to sell a debt security prior to recovery and (ii) it is more likely than not that it will not have to sell the debt security prior to recovery, the security would not be considered other-than-temporarily impaired unless there is a credit loss. When the Company does not intend to sell the security and it is more likely than not that the Company will not have to sell the security before recovery of its cost basis, it will recognize the credit component of an other-than-temporary impairment (“OTTI”) of a debt security in earnings and the remaining portion in comprehensive (loss) income. The credit loss component recognized in earnings is identified as the amount of principal cash flows not expected to be received over the remaining term of the security based on cash flow projections. For held-to-maturity fixed-maturity securities, the amount of OTTI recorded in comprehensive (loss) income for the noncredit portion of a previous OTTI is amortized prospectively over the remaining life of the security on the basis of timing of future estimated cash flows of the security.

OTTI losses are recorded in the consolidated statements of income and comprehensive income (loss) as net realized losses on investments and result in a permanent reduction of the cost basis of the underlying investment. The determination of OTTI is a subjective process and different judgments and assumptions could affect the timing of loss realization. At December 31, 2018 and December 31, 2017, there were 156 and 62 fixed-maturity securities, respectively, and 13 equity securities at December 31, 2017 that accounted for the gross unrealized loss. In December 2017, the Company disposed of one of its held-to-maturity debt securities that was previously recorded in OTTI, which was a bond issued by the Commonwealth of Puerto Rico. In July 2016, Puerto Rico defaulted on its interest payment to bondholders. Due to the credit deterioration of Puerto Rico, the Company recorded its first credit loss component of OTTI on this investment as of June 30, 2016. As of December 31, 2016, the full amount of the write-down was recognized as a credit component of OTTI in the amount of $69,911. In September 2017, Hurricane Maria significantly affected Puerto Rico. The impact of this event further contributed to the credit deterioration of Puerto Rico and, as a result, the Company recorded an additional credit loss component of OTTI on this investment for the amount of $50,000 during the quarter ended September 30, 2017. The total of the two OTTI write-downs of this investment through December 31, 2017 was $119,911. The Company determined that none of the other unrealized losses were deemed to be OTTI for its portfolio of investments for the years ended December 31, 2018 and 2017. Significant factors influencing the Company’s determination that unrealized losses were temporary included the magnitude of the unrealized losses in relation to each security’s cost, the nature of the investment and management’s intent and ability to retain the investment for a period of time sufficient to allow for an anticipated recovery of fair value to the Company’s cost basis.

The Company held available-for-sale securities with unrealized losses representing declines that were considered temporary at December 31, 2018 and 2017 as follows:

	December 31, 2018
	Less than 12 months							12 months or more							Total
	Estimated					No. of		Estimated					No. of		Estimated
	Fair		Unrealized			Positions		Fair		Unrealized			Positions		Fair		Unrealized
Category	Value		Losses			Held		Value		Losses			Held		Value		Losses

Fixed-Maturity Securities:
U.S. Treasury securities
and obligations of U.S.
government corporations
and agencies	$	4,948,530	$	(28,000	)		3	$	-	$	-			-	$	4,948,530	$	(28,000	)

Political subdivisions of
States, Territories and
Possessions		555,375		(12,327	)		1		1,436,242		(36,508	)		3		1,991,617		(48,835	)

Corporate and other
bonds industrial and
miscellaneous		81,004,459		(2,775,540	)		97		13,424,888		(676,605	)		24		94,429,347		(3,452,145	)

Residential mortgage and other
asset backed securities		7,002,713		(231,229	)		9		11,928,425		(331,012	)		19		18,931,138		(562,241	)

Total fixed-maturity
securities	$	93,511,077	$	(3,047,096	)		110	$	26,789,555	$	(1,044,125	)		46	$	120,300,632	$	(4,091,221	)

	December 31, 2017
	Less than 12 months							12 months or more							Total
	Estimated					No. of		Estimated					No. of		Estimated
	Fair		Unrealized			Positions		Fair		Unrealized			Positions		Fair		Unrealized
Category	Value		Losses			Held		Value		Losses			Held		Value		Losses

Fixed-Maturity Securities:
Political subdivisions of
States, Territories and
Possessions	$	1,549,839	$	(30,814	)		4	$	-	$	-			-	$	1,549,839	$	(30,814	)

Corporate and other
bonds industrial and
miscellaneous		15,036,462		(269,857	)		20		9,113,924		(340,516	)		17		24,150,386		(610,373	)

Residential mortgage and other
asset backed securities		6,956,371		(48,482	)		6		7,867,572		(189,022	)		15		14,823,943		(237,504	)

Total fixed-maturity
securities	$	23,542,672	$	(349,153	)		30	$	16,981,496	$	(529,538	)		32	$	40,524,168	$	(878,691	)

Equity Securities:
Preferred stocks	$	1,605,217	$	(20,313	)		5	$	1,776,675	$	(120,712	)		3	$	3,381,892	$	(141,025	)
Common stocks and
exchange traded mutual funds		1,446,375		(222,205	)		4		124,900		(14,530	)		1		1,571,275		(236,735	)

Total equity securities	$	3,051,592	$	(242,518	)		9	$	1,901,575	$	(135,242	)		4	$	4,953,167	$	(377,760	)

Total	$	26,594,264	$	(591,671	)		39	$	18,883,071	$	(664,780	)		36	$	45,477,335	$	(1,256,451	)

4. Fair Value Measurements

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

4. Fair Value Measurements

Fair value is the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The valuation technique used by the Company to estimate the fair value of its financial instruments is the market approach, which uses prices and other relevant information generated by market transactions involving identical or comparable assets.

The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the assets or liabilities fall within different levels of the hierarchy, the classification is based on the lowest level input that is significant to the fair value measurement of the asset or liability. Classification of assets and liabilities within the hierarchy considers the markets in which the assets and liabilities are traded, including during period of market disruption, and the reliability and transparency of the assumptions used to determine fair value. The hierarchy requires the use of observable market data when available. The levels of the hierarchy and those investments included in each are as follows:

Level 1—Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities traded in active markets. Included are those investments traded on an active exchange, such as the NASDAQ Global Select Market, U.S. Treasury securities and obligations of U.S. government agencies, together with corporate debt securities that are generally investment grade.

Level 2—Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs. Municipal and corporate bonds, and residential mortgage-backed securities, that are traded in less active markets are classified as Level 2. These securities are valued using market price quotations for recently executed transactions.

Level 3—Inputs to the valuation methodology are unobservable for the asset or liability and are significant to the fair value measurement. Material assumptions and factors considered in pricing investment securities and other assets may include appraisals, projected cash flows, market clearing activity or liquidity circumstances in the security or similar securities that may have occurred since the prior pricing period.

The availability of observable inputs varies and is affected by a wide variety of factors. When the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires significantly more judgment. The degree of judgment exercised by management in determining fair value is greatest for investments categorized as Level 3. For investments in this category, the Company considers prices and inputs that are current as of the measurement date. In periods of market dislocation, as characterized by current market conditions, the ability to observe prices and inputs may be reduced for many instruments. This condition could cause a security to be reclassified between levels.

The Company’s investments measured at fair value on a recurring basis are allocated among fair value levels at December 31, 2018 and 2017 as follows:

	December 31, 2018
	Level 1		Level 2		Level 3		Total

Fixed-maturity securities available-for-sale
U.S. Treasury securities
and obligations of U.S.
government corporations
and agencies	$	8,220,381	$	-	$	-	$	8,220,381

Political subdivisions of
States, Territories and
Possessions		-		6,341,608		-		6,341,608

Corporate and other
bonds industrial and
miscellaneous		112,076,270		3,674,023		-		115,750,293

Residential mortgage backed securities		-		21,465,234		-		21,465,234
Total fixed maturities		120,296,651		31,480,865		-		151,777,516
Equity securities		16,572,616		-		-		16,572,616
Total investments	$	136,869,267	$	31,480,865	$	-	$	168,350,132

	December 31, 2017
	Level 1		Level 2		Level 3		Total

Fixed-maturity securities available-for-sale
Political subdivisions of
States, Territories and
Possessions	$	-	$	11,315,443	$	-	$	11,315,443

Corporate and other
bonds industrial and
miscellaneous		83,597,300		4,544,165		-		88,141,465

Residential mortgage backed securities		-		20,531,348		-		20,531,348
Total fixed maturities		83,597,300		36,390,956		-		119,988,256
Equity securities		14,286,198		-		-		14,286,198
Total investments	$	97,883,498	$	36,390,956	$	-	$	134,274,454

Pursuant to ASC 820 “Fair Value Measurement,” an entity is permitted, as a practical expedient, to estimate the fair value of an investment within the scope of ASC 820 using the net asset value (“NAV”) per share (or its equivalent) of the investment. The following table sets forth the Company’s investment in a hedge fund investment measured at NAV per share (or its equivalent) as of December 31, 2018 and 2017. The Company measures this investment at fair value on a recurring basis. Fair value using NAV per share is as follows as of the dates indicated:

Category	December 31, 2018		December 31, 2017

Other Investments:
Hedge fund	$	1,855,225	$	-
Total	$	1,855,225	$	-

The investment is generally redeemable with at least 45 days prior written notice. The hedge fund investment is accounted for as a limited partnership by the Company. Revenue is earned based upon the Company’s allocated share of the partnership's changes in unrealized gains and losses to its partners. Such amounts have been recorded in the 2018 consolidated statement of income and comprehensive (loss) income within net (losses) gains on investments.

The estimated fair value and the level of the fair value hierarchy of the Company’s long-term debt as of December 31, 2018 and 2017, which is not measured at fair value is as follows:

	December 31, 2018
	Level 1		Level 2		Level 3		Total
Long-term debt

Senior Notes due 2022	$	-	$	28,521,734	$	-	$	28,521,734

	December 31, 2017
	Level 1		Level 2		Level 3		Total
Long-term debt

Senior Notes due 2022	$	-	$	28,493,251	$	-	$	28,943,251

The fair value of long-term debt is estimated based on observable market prices when available. When observable market prices were not available, the fair values of debt were based on observable market prices of comparable instruments adjusted for differences between the observed instruments and the instruments being valued or is estimated using discounted cash flow analyses, based on current incremental borrowing rates for similar types of borrowing arrangements.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

5. Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

5. Fair Value of Financial Instruments

The Company uses the following methods and assumptions in estimating the fair value of financial instruments and real estate:

Equity securities, available-for-sale fixed income securities, and other investments: Fair value disclosures for these investments are included in “Note 3 - Investments” and “Note 4 – Fair Value Measurements”.

Cash and cash equivalents: The carrying values of cash and cash equivalents approximate their fair values because of the short-term nature of these instruments.

Premiums receivable, reinsurance receivables, and investment subscription receivable: The carrying values reported in the accompanying consolidated balance sheets for these financial instruments approximate their fair values due to the short-term nature of the assets.

Real estate: The estimated fair value of the land and building included in property and equipment, which is used in the Company’s operations, approximates the carrying value. The estimated fair value was based on an appraisal prepared using the sales comparison approach, and accordingly the real estate is a Level 3 asset under the fair value hierarchy.

Reinsurance balances payable: The carrying value reported in the consolidated balance sheets for these financial instruments approximates fair value.

Long-term debt: The estimated fair value of long-term debt is based on observable market interest rates when available. When observable market interest rates were not available, the estimated fair values of debt were based on observable market interest rates of comparable instruments adjusted for differences between the observed instruments and the instruments being valued or is estimated using discounted cash flow analyses, based on current incremental borrowing rates for similar types of borrowing arrangements.

The estimated fair values of the Company’s financial instruments as of December 31, 2018 and 2017 are as follows:

	December 31, 2018				December 31, 2017
	Carrying		Estimated		Carrying		Estimated
	Value		Fair Value		Value		Fair Value

Fixed-maturity securities-held-to maturity	$	4,222,855	$	4,426,416	$	4,869,808	$	5,150,076
Cash and cash equivalents	$	21,138,403	$	21,138,403	$	48,381,633	$	48,381,633
Investment subscription receivable	$	-	$	-	$	2,000,000	$	2,000,000
Premiums receivable, net	$	13,961,599	$	13,961,599	$	13,217,698	$	13,217,698
Reinsurance receivables, net	$	26,367,115	$	26,367,115	$	28,519,130	$	28,519,130
Real estate, net of accumulated depreciation	$	2,300,827	$	2,705,000	$	2,261,829	$	2,705,000
Reinsurance balances payable	$	1,933,376	$	1,933,376	$	2,563,966	$	2,563,966
Long-term debt, net	$	29,295,251	$	28,521,734	$	29,126,965	$	28,943,251

6. Intangibles

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

6. Intangibles

Intangible assets consist of finite and indefinite life assets. Finite life intangible assets include customer and producer relationships and other identifiable intangibles. The insurance company license is considered an indefinite life intangible asset subject to annual impairment testing. The remaining weighted average amortization period of identified intangible assets of finite useful life is approximately 0.5 years as of December 31, 2018.

The components of intangible assets and their useful lives, accumulated amortization, and net carrying value as of December 31, 2018 and 2017 are summarized as follows:

			December 31, 2018						December 31, 2017
	Useful		Gross				Net		Gross				Net
	Life		Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
	(in yrs)		Value		Amortization		Amount		Value		Amortization		Amount
Insurance license		-	$	500,000	$	-	$	500,000	$	500,000	$	-	$	500,000
Customer relationships		10		3,400,000		3,230,000		170,000		3,400,000		2,890,000		510,000
Other identifiable
intangibles		7		950,000		950,000		-		950,000		950,000		-
Total			$	4,850,000	$	4,180,000	$	670,000	$	4,850,000	$	3,840,000	$	1,010,000

Intangible asset impairment testing and amortization

The Company performs an analysis annually as of December 31, or sooner if there are indicators that the asset may be impaired, to identify potential impairment of intangible assets with both finite and indefinite lives and measures the amount of any impairment loss that may need to be recognized. Intangible asset impairment testing requires an evaluation of the estimated fair value of each identified intangible asset to its carrying value. An impairment charge would be recorded if the estimated fair value is less than the carrying amount of the intangible asset. No impairments have been identified for the years ended December 31, 2018 and 2017.

The Company recorded amortization expense related to intangibles of $340,000, for each of the years ended December 31, 2018 and 2017. The $170,000 remaining net carrying amount of finite life intangibles will be amortized during the year ending December 31, 2019.

7. Reinsurance

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

7. Reinsurance

The Company’s quota share reinsurance treaties are on a July 1 through June 30 fiscal year basis; therefore, for year to date fiscal periods after June 30, two separate treaties will be included in such periods.

The Company’s quota share reinsurance treaties in effect for the year ended December 31, 2018 for its personal lines business, which primarily consists of homeowners’ policies, were covered under the July 1, 2017 through June 30, 2018 treaty year and the new treaty year that began on July 1, 2018 (“2017/2019 Treaty”). The Company’s quota share reinsurance treaties in effect for the year ended December 31, 2017 were covered under the 2017/2019 Treaty and July 1, 2016 through June 30, 2017 treaty year (“2016/2017 Treaty”).

In March 2017, the Company bound its personal lines quota share reinsurance treaty effective July 1, 2017. The treaty provided for a reduction in the quota share ceding rate to 20%, from 40% in the 2016/2017 Treaty, and an increase in the provisional ceding commission rate to 53%, from 52% in the 2016/2017 Treaty. The 2017/2019 Treaty covered a two-year period from July 1, 2017 through June 30, 2019. In August 2018, the Company terminated its contract with one of the reinsurers that was a party to the 2017/2019 Treaty. This termination was retroactive to July 1, 2018 and had the effect of reducing the quota share ceding rate to 10% from 20%.

The Company entered into new excess of loss and catastrophe reinsurance treaties effective July 1, 2018. Material terms for reinsurance treaties in effect for the treaty years shown below are as follows:

	Treaty Year
	July 1, 2018			July 1, 2017			July 1, 2016
	to			to			to
Line of Busines	June 30, 2019			June 30, 2018			June 30, 2017

Personal Lines:
Homeowners, dwelling fire and canine legal liability
Quota share treaty:
Percent ceded		10	%		20	%		40	%
Risk retained	$	900,000		$	800,000		$	500,000
Losses per occurrence subject to quota share reinsurance coverage	$	1,000,000		$	1,000,000		$	833,333
Excess of loss coverage and facultative facility above quota share coverage (1)	$	9,000,000		$	9,000,000		$	3,666,667
	in excess of			in excess of				in excess of
	$	1,000,000		$	1,000,000		$	833,333
Total reinsurance coverage per occurrence	$	9,100,000		$	9,200,000		$	4,000,000
Losses per occurrence subject to reinsurance coverage	$	10,000,000		$	10,000,000		$	4,500,000
Expiration date	June 30, 2019			June 30, 2018				June 30, 2017

Personal Umbrella
Quota share treaty:
Percent ceded - first $1,000,000 of coverage		90	%		90	%		90	%
Percent ceded - excess of $1,000,000 dollars of coverage		100	%		100	%		100	%
Risk retained	$	100,000		$	100,000		$	100,000
Total reinsurance coverage per occurrence	$	4,900,000		$	4,900,000		$	4,900,000
Losses per occurrence subject to quota share reinsurance coverage	$	5,000,000		$	5,000,000		$	5,000,000
Expiration date	June 30, 2019			June 30, 2018				June 30, 2017

Commercial Lines:
General liability commercial policies
Quota share treaty	None			None				None
Risk retained	$	750,000		$	750,000		$	500,000
Excess of loss coverage above risk retained	$	3,750,000		$	3,750,000		$	4,000,000
		in excess of			in excess of			in excess of
	$	750,000		$	750,000		$	500,000
Total reinsurance coverage per occurrence	$	3,750,000		$	3,750,000		$	4,000,000
Losses per occurrence subject to reinsurance coverage	$	4,500,000		$	4,500,000		$	4,500,000

Commercial Umbrella
Quota share treaty:
Percent ceded - first $1,000,000 of coverage		90	%		90	%		90	%
Percent ceded - excess of $1,000,000 of coverage		100	%		100	%		100	%
Risk retained	$	100,000		$	100,000		$	100,000
Total reinsurance coverage per occurrence	$	4,900,000		$	4,900,000		$	4,900,000
Losses per occurrence subject to quota share reinsurance coverage	$	5,000,000		$	5,000,000		$	5,000,000
Expiration date	June 30, 2019			June 30, 2018				June 30, 2017

Catastrophe Reinsurance:
Initial loss subject to personal lines quota share treaty	$	5,000,000		$	5,000,000		$	5,000,000
Risk retained per catastrophe occurrence (2)	$	4,500,000		$	4,000,000		$	3,000,000
Catastrophe loss coverage in excess of quota share coverage (3) (4)	$	445,000,000		$	315,000,000		$	247,000,000
Reinstatement premium protection (5)		Yes			Yes			Yes

(1)	For personal lines, the 2017/2019 Treaty includes the addition of an automatic facultative facility allowing KICO to obtain homeowners single risk coverage up to $10,000,000 in total insured value, which covers direct losses from $3,500,000 to $10,000,000.

(2)	Plus losses in excess of catastrophe coverage.

(3)	Catastrophe coverage is limited on an annual basis to two times the per occurrence amounts. Effective July 1, 2016, the duration of a catastrophe occurrence from windstorm, hail, tornado, hurricane and cyclone was extended to 168 consecutive hours from 120 consecutive hours.

(4)	Effective July 1, 2018, the top $50,000,000 layer of catastrophe reinsurance coverage has a two year term expiring on June 30, 2020.

(5)	Effective July 1, 2016, reinstatement premium protection for $20,000,000 of catastrophe coverage in excess of $5,000,000.

Effective July 1, 2017, reinstatement premium protection for $145,000,000 of catastrophe coverage in excess of $5,000,000.

Effective July 1, 2018, reinstatement premium protection for $210,000,000 of catastrophe coverage in excess of $5,000,000.

The single maximum risks per occurrence to which the Company is subject under the treaties effective July 1, 2018 are as follows:

	July 1, 2018 - June 30, 2019
Treaty	Extent of Loss	Risk Retained
Personal Lines (1)	Initial $1,000,000	$900,000
	$1,000,000 - $10,000,000	None(2)
	Over $10,000,000	100%

Personal Umbrella	Initial $1,000,000	$100,000
	$1,000,000 - $5,000,000	None
	Over $5,000,000	100%

Commercial Lines	Initial $750,000	$750,000
	$750,000 - $4,500,000	None(3)
	Over $4,500,000	100%

Commercial Umbrella	Initial $1,000,000	$100,000
	$1,000,000 - $5,000,000	None
	Over $5,000,000	100%

Catastrophe (4)	Initial $5,000,000	$4,500,000
	$5,000,000 - $450,000,000	None
	Over $450,000,000	100%

(1)	Treaty for July 1, 2018 – June 30, 2019 is a two year treaty with expiration date of June 30, 2019.

(2)	Covered by excess of loss treaties up to $3,500,000 and by facultative facility from $3,500,000 to $10,000,000.

(3)	Covered by excess of loss treaties.

(4)	Catastrophe coverage is limited on an annual basis to two times the per occurrence amounts.

The single maximum risks per occurrence to which the Company is subject under the treaty years shown below are as follows:

	July 1, 2017 - June 30, 2018		July 1, 2016 - June 30, 2017
Treaty	Range of Loss	Risk Retained	Range of Loss	Risk Retained
Personal Lines	Initial $1,000,000	$800,000	Initial $833,333	$500,000
	$1,000,000 - $10,000,000	None(2)	$833,333 - $4,500,000	None(3)
	Over $10,000,000	100%	Over $4,500,000	100%

Personal Umbrella	Initial $1,000,000	$100,000	Initial $1,000,000	$100,000
	$1,000,000 - $5,000,000	None	$1,000,000 - $5,000,000	None
	Over $5,000,000	100%	Over $5,000,000	100%

Commercial Lines	Initial $750,000	$750,000	Initial $500,000	$500,000
	$750,000 - $4,500,000	None(3)	$500,000 - $4,500,000	None(3)
	Over $4,500,000	100%	Over $4,500,000	100%

Commercial Umbrella	Initial $1,000,000	$100,000	Initial $1,000,000	$100,000
	$1,000,000 - $5,000,000	None	$1,000,000 - $5,000,000	None
	Over $5,000,000	100%	Over $5,000,000	100%

Catastrophe (4)	Initial $5,000,000	$4,000,000	Initial $5,000,000	$3,000,000
	$5,000,000 - $320,000,000	None	$5,000,000 - $252,000,000	None
	Over $320,000,000	100%	Over $252,000,000	100%

(1)	Treaty for July 1, 2017 – June 30, 2018 is a two year treaty with expiration date of June 30, 2019.

(2)	Covered by excess of loss treaties up to $3,500,000 and by facultative facility from $3,500,000 to $10,000,000.

(3)	Covered by excess of loss treaties.

(4)	Catastrophe coverage is limited on an annual basis to two times the per occurrence amounts.

The Company’s reinsurance program is structured to enable the Company to significantly grow its premium volume while maintaining regulatory capital and other financial ratios generally within or below the expected ranges used for regulatory oversight purposes. The reinsurance program also provides income as a result of ceding commissions earned pursuant to the quota share reinsurance contracts. The Company’s participation in reinsurance arrangements does not relieve the Company of its obligations to policyholders.

Approximate reinsurance recoverables on unpaid and paid losses by reinsurer at December 31, 2018 and 2017 are as follows:

	Unpaid		Paid
($ in thousands)	Losses		Losses		Total		Security
December 31, 2018
Maiden Reinsurace Company	$	5,319	$	1,277	$	6,596	$	7,548	(1	)
Swiss Reinsurance America Corporation		4,499		1,251		5,750		-
Hanover Rueck SE		2,728		1,181		3,909		-
SCOR Reinsurance Company		528		89		617		-
Allied World Assurance Company		306		373		679		-
Others		2,291		282		2,573		58	(2	)
Total	$	15,671	$	4,453	$	20,124	$	7,606

December 31, 2017
Maiden Reinsurace Company	$	8,160	$	968	$	9,128	$	10,583	(1	)
Swiss Reinsurance America Corporation		4,299		600		4,899		-
Hanover Rueck SE		857		420		1,277		-
SCOR Reinsurance Company		851		209		1,060		-
Allied World Assurance Company		1,649		188		1,837		-
Others		932		148		1,080		205	(3	)
Total	$	16,748	$	2,533	$	19,281	$	10,788

(1) On December 27, 2018, Enstar Group Limited announced that one of its wholly owned subsidiaries, Cavello Bay Reinsurance Limited acquired Maiden Reinsurance North America, Inc.

(2) Secured pursuant to collateralized trust agreements.

(3) Represents $53,000 secured pursuant to collateralized trust agreement and $5,000 guaranteed by an irrevocable letter of credit.

(4) Represents $202,000 secured pursuant to collateralized trust agreement and $3,000 guaranteed by an irrevocable letter of credit.

Assets held in the trusts referred to in footnotes (2), (3), and (4) in the table above are not included in the Company’s invested assets and investment income earned on these assets is credited to the reinsurers respectively. In addition to reinsurance recoverables on unpaid and paid losses, reinsurance receivables in the accompanying consolidated balance sheets as of December 31, 2018 and 2017 include unearned ceded premiums of approximately $6,243,000 and $9,237,000, respectively.

Ceding Commission Revenue

The Company earns ceding commission revenue under its quota share reinsurance agreements based on: (i) a fixed provisional commission rate at which provisional ceding commissions are earned, and (ii) a sliding scale of commission rates and ultimate treaty year loss ratios on the policies reinsured under each of these agreements based upon which contingent ceding commissions are earned. The sliding scale includes minimum and maximum commission rates in relation to specified ultimate loss ratios. The commission rate and contingent ceding commissions earned increases when the estimated ultimate loss ratio decreases and, conversely, the commission rate and contingent ceding commissions earned decreases when the estimated ultimate loss ratio increases.

The Company’s estimated ultimate treaty year loss ratios (the “Loss Ratio(s)”) for treaties in effect for the year ended December 31, 2018 are attributable to contracts for the 2017/2019 Treaty. The Company’s estimated ultimate treaty year Loss Ratios for treaties in effect for the year ended December 31, 2017 are attributable to contracts for the 2017/2019 Treaty and 2016/2017 Treaty.

Treaties in effect for the year ended December 31, 2018

Under the 2017/2019 Treaty, the Company receives an upfront fixed provisional rate that is subject to a sliding scale contingent adjustment based upon the Loss Ratio. Under this arrangement, the Company earns and earned provisional ceding commissions that are subject to later adjustment dependent on changes to the estimated Loss Ratio for the 2017/2019 Treaty. The Company’s Loss Ratios for the period July 1, 2018 through December 31, 2018 attributable to the 2017/2019 Treaty were consistent with the contractual Loss Ratio at which provisional ceding commissions were earned, and therefore no contingent commission adjustment was recorded for the six-month period ended December 31, 2018. The Company’s Loss Ratios for the period July 1, 2017 through June 30, 2018 attributable to the 2017/2019 Treaty were higher than the contractual Loss Ratio at which provisional ceding commissions were earned. Accordingly, for the six months ended June 30, 2018, the Company incurred negative contingent ceding commissions as a result of the estimated Loss Ratio for the 2017/2019 Treaty, which reduced contingent ceding commissions earned.

Treaties in effect for the year ended December 31, 2017

Under the 2017/2019 Treaty and the 2016/2017 Treaty, the Company received, an upfront fixed provisional rate that was subject to a sliding scale contingent adjustment based upon the Loss Ratio. Under this arrangement, the Company earned provisional ceding commissions that were subject to later adjustment dependent on changes to the estimated Loss Ratio for the 2017/2019 Treaty and 2016/2017 Treaty. The Company’s Loss Ratios for the period July 1, 2017 through December 31, 2017 attributable to the 2017/2019 Treaty, and from July 1, 2016 through December 31, 2017 attributable to the 2016/2017 Treaty, were consistent with the contractual Loss Ratio at which the provisional ceding commissions were earned and therefore no additional contingent commission was recorded for the year ended December 31, 2017 with respect to these treaties.

In addition to the treaties that were in effect for the years ended December 31, 2018 and 2017, the Loss Ratios from prior years’ treaties are subject to change as loss reserves from those periods increase or decrease, resulting in an increase or decrease in the commission rate and contingent ceding commissions earned.

Ceding commission revenues earned consists of the following:

	Years ended
	December 31,
	2018			2017

Provisional ceding commissions earned	$	6,745,928		$	10,677,214
Contingent ceding commissions earned		(1,413,298	)		(744,081	)
	$	5,332,630		$	9,933,133

Provisional ceding commissions are settled monthly. Balances due from reinsurers for contingent ceding commissions on quota share treaties are settled annually based on the Loss Ratio of each treaty year that ends on June 30. As discussed above, the Loss Ratios from prior years’ treaties are subject to change as incurred losses from those periods develop, resulting in an increase or decrease in the commission rate and contingent ceding commissions earned. As of December 31, 2018 and 2017, net contingent ceding commissions payable to reinsurers under all treaties was approximately $1,581,000 and $1,850,000, respectively, which are recorded in reinsurance balances payable on the accompanying consolidated balance sheets.

8. Deferred Policy Acquisition Costs and Deferred Ceding Commission Revenue

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

8. Deferred Policy Acquisition Costs and Deferred Ceding Commission Revenue

Deferred policy acquisition costs incurred and policy-related ceding commission revenue are deferred and amortized to income on property and casualty insurance business as follows:

	Years ended
	December 31,
	2018			2017

Net deferred policy acquisition costs, net of ceding
commission revenue, beginning of year	$	10,580,824		$	5,387,940

Cost incurred and deferred:
Commissions and brokerage		27,687,907			23,093,880
Other underwriting and policy acquisition costs		8,227,992			6,669,904
Ceding commission revenue		(5,166,193	)		(8,091,785	)
Net deferred policy acquisition costs		30,749,706			21,671,999
Return of deferred ceding commission revenue
due to reduction of quota share		(2,413,273	)		(3,648,859	)
Amortization		(23,696,197	)		(12,830,256	)
		4,640,236			5,192,884

Net deferred policy acquisition costs, net of ceding
commission revenue, end of year	$	15,221,060		$	10,580,824

Ending balances for deferred policy acquisition costs and deferred ceding commission revenue as of December 31, 2018 and 2017 follows:

	December 31,
	2018			2017

Deferred policy acquisition costs	$	17,907,737		$	14,847,236
Deferred ceding commission revenue		(2,686,677	)		(4,266,412	)
Balance at end of period	$	15,221,060		$	10,580,824

9. Debt

12 Months Ended

Dec. 31, 2018

Debt

9. Debt

Federal Home Loan Bank

In July 2017, KICO became a member of, and invested in, the Federal Home Loan Bank of New York (“FHLBNY”). The aggregate investment in dividend bearing common stock was $18,400 as of December 31, 2018. FHLBNY members have access to a variety of flexible, low cost funding through FHLBNY’s credit products, enabling members to customize advances, which are to be fully collateralized. Eligible collateral to pledge to FHLBNY includes residential and commercial mortgage backed securities, along with U.S. Treasury and agency securities. See Note 3 – Investments for eligible collateral held in a designated custodian account available for future advances. Advances are limited to 5% of KICO’s net admitted assets as of December 31 of the previous year and are due and payable within one year of borrowing. The maximum allowable advance as of December 31, 2018 was approximately $9,849,000. Advances are limited to the amount of available collateral, which was approximately $5,116,000 as of December 31, 2018. There were no borrowings under this facility during the year ended December 31, 2018.

Long-term Debt

On December 19, 2017, the Company issued $30 million of its 5.50% Senior Unsecured Notes due December 30, 2022 (the “Notes”) in an underwritten public offering. Interest is payable semi-annually in arrears on June 30 and December 30 of each year, which began on June 30, 2018 at the rate of 5.50%. The net proceeds of the issuance were $29,121,630, net of discount of $163,200 and transaction costs of $715,170, for an effective yield of 5.67%. The balance of long-term debt as of December 31, 2018 and 2017 is as follows:

	December 31,			December 31,
	2018			2017

5.50% Senior Unsecured Notes	$	30,000,000		$	30,000,000
Discount		(129,796	)		(162,209	)
Issuance costs		(574,953	)		(710,826	)
Long-term debt, net	$	29,295,251		$	29,126,965

The Notes are unsecured obligations of the Company and are not the obligations of or guaranteed by any of the Company's subsidiaries. The Notes rank senior in right of payment to any of the Company's existing and future indebtedness that is by its terms expressly subordinated or junior in right of payment to the Notes. The Notes rank equally in right of payment to all of the Company's existing and future senior indebtedness, but will be effectively subordinated to any secured indebtedness to the extent of the value of the collateral securing such secured indebtedness. In addition, the Notes will be structurally subordinated to the indebtedness and other obligations of the Company's subsidiaries. The Company may redeem the Notes, at any time in whole or from time to time in part, at the redemption price equal to the greater of: (i) 100% of the principal amount of the Notes to be redeemed; and (ii) the sum of the present values of the remaining scheduled payments of principal and interest on the Notes to be redeemed that would be due if the Notes matured on the applicable redemption date (exclusive of interest accrued to the applicable redemption date) discounted to the redemption date on a semi-annual basis at the Treasury Rate, plus 50 basis points.

On December 20, 2017, the Company used $25,000,000 of the net proceeds from the offering to contribute capital to KICO, to support additional growth. The remainder of the net proceeds are being used for general corporate purposes. A registration statement relating to the debt issued in the offering was filed with the SEC which became effective on November 28, 2017.

10. Property and Equipment

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

10. Property and Equipment

The components of property and equipment are summarized as follows:

			Accumulated
	Cost		Depreciation			Net

December 31, 2018
Building	$	2,231,967	$	(554,077	)	$	1,677,890
Land		622,937		-			622,937
Furniture office equipment		723,217		(586,010	)		137,207
Computer equipment and software		7,240,613		(3,621,718	)		3,618,895
Total	$	10,818,734	$	(4,761,805	)	$	6,056,929

December 31, 2017
Building	$	2,146,950	$	(460,819	)	$	1,686,131
Land		575,698		-			575,698
Furniture office equipment		707,524		(493,558	)		213,966
Computer equipment and software		4,657,174		(2,360,392	)		2,296,782
Total	$	8,087,346	$	(3,314,769	)	$	4,772,577

Depreciation expense for the years ended December 31, 2018 and 2017 was $1,447,150 and $1,062,928, respectively.

11. Property and Casualty Insurance Activity

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

11. Property and Casualty Insurance Activity

Premiums written, ceded and earned are as follows:

	Written
	Direct			Assumed		Ceded			Net

Year ended December 31, 2018
Premiums written	$	146,716,468		$	1,004	$	(26,923,679	)	$	119,793,793
Change in unearned premiums		(13,388,535	)		4,067		(2,994,610	)		(16,379,078	)
Premiums earned	$	133,327,933		$	5,071	$	(29,918,289	)	$	103,414,715

Year ended December 31, 2017
Premiums written	$	121,575,178		$	22,847	$	(28,729,149	)	$	92,868,876
Change in unearned premiums		(10,662,744	)		9,456		(4,864,565	)		(15,517,853	)
Premiums earned	$	110,912,434		$	32,303	$	(33,593,714	)	$	77,351,023

Premium receipts in advance of the policy effective date are recorded as advance premiums. The balance of advance premiums as of December 31, 2018 and 2017 was $2,107,629 and $1,477,693, respectively.

The components of the liability for loss and LAE expenses and related reinsurance receivables as of December 31, 2018 and 2017 are as follows:

	Gross		Reinsurance
	Liability		Receivables
December 31, 2018
Case-basis reserves	$	35,812,037	$	12,283,616
Loss adjustment expenses		9,102,862		1,433,170
IBNR reserves		11,282,207		1,954,461
Recoverable on unpaid losses				15,671,247
Recoverable on paid losses		-		4,453,298
Total loss and loss adjustment expenses	$	56,197,106		20,124,545
Unearned premiums				6,242,570
Total reinsurance receivables			$	26,367,115

December 31, 2017
Case-basis reserves	$	30,499,592	$	11,987,693
Loss adjustment expenses		8,635,199		1,990,506
IBNR reserves		9,664,831		2,770,709
Recoverable on unpaid losses				16,748,908
Recoverable on paid losses		-		2,533,042
Total loss and loss adjustment expenses	$	48,799,622		19,281,950
Unearned premiums				9,237,180
Total reinsurance receivables			$	28,519,130

The following table provides a reconciliation of the beginning and ending balances for unpaid losses and LAE:

	Years ended
	December 31,
	2018			2017

Balance at beginning of period	$	48,799,622		$	41,736,719
Less reinsurance recoverables		(16,748,908	)		(15,776,880	)
Net balance, beginning of period		32,050,714			25,959,839

Incurred related to:
Current year		57,143,077			34,246,081
Prior years		1,152,128			(60,544	)
Total incurred		58,295,205			34,185,537

Paid related to:
Current year		34,025,387			18,194,860
Prior years		15,794,673			9,899,802
Total paid		49,820,060			28,094,662

Net balance at end of period		40,525,859			32,050,714
Add reinsurance recoverables		15,671,247			16,748,908
Balance at end of period	$	56,197,106		$	48,799,622

Incurred losses and LAE are net of reinsurance recoveries under reinsurance contracts of $14,482,712 and $14,067,027 for the years ended December 31, 2018 and 2017, respectively.

Prior year incurred loss and LAE development results from changes in ultimate loss and LAE estimates by line of business and accident year. Prior year loss and LAE development incurred during the years ended December 31, 2018 and 2017 was unfavorable $1,152,128 and favorable $(60,544) respectively. The Company’s management continually monitors claims activity to assess the appropriateness of carried case and incurred but not reported (“IBNR”) reserves, giving consideration to Company and industry trends.

Loss and LAE reserves

The reserving process for loss and LAE reserves provides for the Company’s best estimate at a particular point in time of the ultimate unpaid cost of all losses and LAE incurred, including settlement and administration of losses, and is based on facts and circumstances then known including losses that have occurred but that have not yet been reported. The process relies on standard actuarial reserving methodologies, judgments relative to estimates of ultimate claims severity and frequency, the length of time before losses will develop to their ultimate level (‘tail’ factors), and the likelihood of changes in the law or other external factors that are beyond the Company’s control. Several actuarial reserving methodologies are used to estimate required loss reserves. The process produces carried reserves set by management based upon the actuaries’ best estimate and is the cumulative combination of the best estimates made by line of business, accident year, and loss and LAE. The amount of loss and LAE reserves for individual reported claims (the “case reserve”) is determined by the claims department and changes over time as new information is gathered. Such information includes a review of coverage applicability, comparative liability on the part of the insured, injury severity, property damage, replacement cost estimates, and any other information considered pertinent to estimating the exposure presented by the claim. The amounts of loss and LAE reserves for unreported claims and development on known claims (IBNR reserves) are determined using historical information aggregated by line of insurance as adjusted to current conditions. Since this process produces loss reserves set by management based upon the actuaries’ best estimate, there is no explicit or implicit provision for uncertainty in the carried loss reserves.

Due to the inherent uncertainty associated with the reserving process, the ultimate liability may differ, perhaps substantially, from the original estimate. Such estimates are regularly reviewed and updated and any resulting adjustments are included in the current period’s results. Reserves are closely monitored and are recomputed periodically using the most recent information on reported claims and a variety of statistical techniques. On at least a quarterly basis, the Company reviews by line of business existing reserves, new claims, changes to existing case reserves and paid losses with respect to the current and prior periods. Several methods are used, varying by line of business and accident year, in order to select the estimated period-end loss reserves. These methods include the following:

Paid Loss Development – historical patterns of paid loss development are used to project future paid loss emergence in order to estimate required reserves.

Incurred Loss Development – historical patterns of incurred loss development, reflecting both paid losses and changes in case reserves, are used to project future incurred loss emergence in order to estimate required reserves.

Paid Bornhuetter-Ferguson (“BF”) – an estimated loss ratio for a particular accident year is determined, and is weighted against the portion of the accident year claims that have been paid, based on historical paid loss development patterns. The estimate of required reserves assumes that the remaining unpaid portion of a particular accident year will pay out at a rate consistent with the estimated loss ratio for that year. This method can be useful for situations where an unusually high or low amount of paid losses exists at the early stages of the claims development process.

Incurred Bornhuetter-Ferguson (“BF”) - an estimated loss ratio for a particular accident year is determined, and is weighted against the portion of the accident year claims that have been reported, based on historical incurred loss development patterns. The estimate of required reserves assumes that the remaining unreported portion of a particular accident year will pay out at a rate consistent with the estimated loss ratio for that year. This method can be useful for situations where an unusually high or low amount of reported losses exists at the early stages of the claims development process.

Incremental Claim-Based Methods – historical patterns of incremental incurred losses and paid LAE during various stages of development are reviewed and assumptions are made regarding average loss and LAE development applied to remaining claims inventory. Such methods more properly reflect changes in the speed of claims closure and the relative adequacy of case reserve levels at various stages of development. These methods also provide a more accurate estimate of IBNR for lines of business with relatively few remaining open claims but for which significant recent settlement activity has occurred.

Management’s best estimate of required reserves is generally based on an average of the methods above, with appropriate weighting of the various methods based on the line of business and accident year being projected. In some cases, additional methods or historical data from industry sources are employed to supplement the projections derived from the methods listed above.

Two key assumptions that materially affect the estimate of loss reserves are the loss ratio estimate for the current accident year used in the BF methods described above, and the loss development factor selections used in the loss development methods described above. The loss ratio estimates used in the BF methods are selected after reviewing historical accident year loss ratios adjusted for rate changes, trend, and mix of business.

The Company is not aware of any claim trends that have emerged or that would cause future adverse development that have not already been considered in existing case reserves and in its current loss development factors.

In New York State, lawsuits for negligence are subject to certain limitations and must be commenced within three years from the date of the accident or are otherwise barred. Accordingly, the Company’s exposure to unreported claims (“pure” IBNR) for accident dates of December 31, 2015 and prior is limited, although there remains the possibility of adverse development on reported claims (“case development” IBNR). In certain rare circumstances states have retroactively revised a statute of limitations. The Company is not aware of any such effort that would have a material impact on the Company’s results.

The following is information about incurred and paid claims development as of December 31, 2018, net of reinsurance, as well as the cumulative reported claims by accident year and total IBNR reserves as of December 31, 2018 included in the net incurred loss and allocated expense amounts. The historical information regarding incurred and paid claims development for the years ended December 31, 2009 to December 31, 2017 is presented as supplementary unaudited information.

Reported claim counts are measured on an occurrence or per event basis. A single claim occurrence could result in more than one loss type or claimant; however, the Company counts claims at the occurrence level as a single claim regardless of the number of claimants or claim features involved.

All Lines of Business
*(in thousands, except reported claims data)*
											As of
	Incurred Loss and Allocated Loss Adjustment Expenses, Net of Reinsurance										December 31, 2018
	For the Years Ended December 31,										IBNR	Cumulative Number of Reported Claims by Accident Year
Accident Year	2009	2010	2011	2012	2013	2014	2015	2016	2017	2018	IBNR	Cumulative Number of Reported Claims by Accident Year
	(Unaudited 2009 - 2017)

2009	$4,403	$4,254	$4,287	$4,384	$4,511	$4,609	$4,616	$4,667	$4,690	$ 4,672	$ -	1,136
2010		5,598	5,707	6,429	6,623	6,912	6,853	6,838	6,840	6,787	-	1,617
2011			7,603	7,678	8,618	9,440	9,198	9,066	9,144	9,171	(3)	1,914
2012				9,539	9,344	10,278	10,382	10,582	10,790	10,791	(4)	4,702	(1)
2013					10,728	9,745	9,424	9,621	10,061	10,089	38	1,560
2014						14,193	14,260	14,218	14,564	15,023	238	2,131
2015							22,340	21,994	22,148	22,491	537	2,552
2016								26,062	24,941	24,789	1,096	2,862
2017									31,605	32,169	2,697	3,335
2018										54,455	9,079	3,935
									Total	$ 190,437
(1) Reported claims for accident year 2012 includes 3,406 claims from Superstorm Sandy.

All Lines of Business
*(in thousands)*
	Cumulative Paid Loss and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,
Accident Year	2009	2010	2011	2012	2013	2014	2015	2016	2017	2018
	(Unaudited 2009 - 2017)

2009	$2,298	$3,068	$3,607	$3,920	$4,134	$4,362	$4,424	$4,468	$4,487	$ 4,659
2010		2,566	3,947	4,972	5,602	6,323	6,576	6,720	6,772	6,780
2011			3,740	5,117	6,228	7,170	8,139	8,540	8,702	8,727
2012				3,950	5,770	7,127	8,196	9,187	10,236	10,323
2013					3,405	5,303	6,633	7,591	8,407	9,056
2014						5,710	9,429	10,738	11,770	13,819
2015							12,295	16,181	18,266	19,984
2016								15,364	19,001	21,106
2017									16,704	24,820
2018										32,383
									Total	$ 151,657

Net liability for unpaid loss and allocated loss adjustment expenses for the accident years presented										$ 38,780
All outstanding liabilities before 2009, net of reinsurance										93
Liabilities for loss and allocted loss adjustment expenses, net of reinsurance										$ 38,873

Reported claim counts are measured on an occurrence or per event basis. A single claim occurrence could result in more than one loss type or claimant; however the Company counts claims at the occurrence level as a single claim regardless of the number of claimants or claim features involved.

The reconciliation of the net incurred and paid claims development tables to the liability for loss and LAE reserves in the consolidated balance sheet is as follows:

	As of
*(in thousands)*	December 31, 2018
Liabilities for loss and loss adjustment expenses, net of reinsurance	$	38,873
Total reinsurance recoverable on unpaid losses		15,671
Unallocated loss adjustment expenses		1,653
Total gross liability for loss and LAE reserves	$	56,197

The following is supplementary unaudited information about average historical claims duration as of December 31, 2018:

Average Annual Percentage Payout of Incurred Loss and Allocated Loss Adjustment Expenses by Age, Net of Reinsurance (Unaudited)
Years	1	2	3	4	5	6	7	8	9	10

All Lines of Business	46.4%	18.8%	11.4%	8.6%	9.5%	5.8%	1.5%	0.7%	0.3%	3.7%

The percentages in the above table do not add up to 100% because the percentages represent averages across all accident years at each development stage.

12. Stockholders' Equity

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

12. Stockholders' Equity

Public Offering of Common Stock

On January 31, 2017, the Company closed on an underwritten public offering of 2,500,000 shares of its Common Stock. On February 14, 2017, the Company closed on the underwriters’ purchase option for an additional 192,500 shares of its Common Stock. The public offering price for the 2,692,500 shares sold was $12.00 per share. The aggregate net proceeds to the Company were approximately $30,137,000, after deducting underwriting discounts and commissions and other offering expenses in the aggregate amount of approximately $2,173,000.

On March 1, 2017, the Company used $23,000,000 of the net proceeds from the offering to contribute capital to its insurance subsidiary, KICO, to support its ratings upgrade plan and additional growth. The remainder of the net proceeds will be used for general corporate purposes. A shelf registration statement relating to the shares sold in the offering was filed with the SEC and became effective on January 19, 2017.

Dividends Declared

Dividends declared and paid on Common Stock were $4,279,494 and $3,214,471 for the years ended December 31, 2018 and 2017, respectively. The Company’s Board of Directors approved a quarterly dividend on February 14, 2019 of $.10 per share payable in cash on March 15, 2019 to stockholders of record as of February 28, 2019 (see Note 19 - Subsequent Events).

Stock Options

Pursuant to the Company’s 2005 Equity Participation Plan (the “2005 Plan”), which provides for the issuance of incentive stock options, non-statutory stock options and restricted stock, a maximum of 700,000 shares of the Company’s Common Stock are permitted to be issued pursuant to options granted and restricted stock issued. Effective August 12, 2014, the Company adopted the 2014 Equity Participation Plan (the “2014 Plan”) pursuant to which, a maximum of 700,000 shares of Common Stock of the Company are authorized to be issued pursuant to the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock and stock bonuses. Incentive stock options granted under the 2014 Plan and 2005 Plan expire no later than ten years from the date of grant (except no later than five years for a grant to a 10% stockholder). The Board of Directors or the Compensation Committee determines the expiration date with respect to non-statutory stock options and the vesting provisions for restricted stock granted under the 2014 Plan and 2005 Plan.

The results of operations for the years ended December 31, 2018 and 2017 include stock-based compensation expense totaling approximately $6,000 and $38,000, respectively. Stock-based compensation expense related to stock options is net of estimated forfeitures of approximately 17% for the years ended December 31, 2018 and 2017. Such amounts have been included in the consolidated statements of income and comprehensive income (loss) within other operating expenses.

Stock-based compensation expense in 2018 and 2017 is the estimated fair value of options granted, amortized on a straight-line basis over the requisite service period, for the entire portion of the award less an estimate for anticipated forfeitures. The Company uses the “simplified” method to estimate the expected term of the options because the Company’s historical share option exercise experience does not provide a reasonable basis upon which to estimate expected term. No options were granted during the years ended December 31, 2018 and 2017.

The Black-Scholes Option Valuation Model was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including the expected stock price volatility. Because our stock options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do not necessarily provide a reliable single measure of the fair value of our stock options.

A summary of stock option activity under the Company’s 2014 Plan and 2005 Plan for the year ended December 31, 2018 is as follows:

Stock Options	Number of Shares			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value

Outstanding at January 1, 2018		341,150		$	6.69		1.67	$	4,131,028

Granted		-		$	-		-	$	-
Exercised		(303,650	)	$	6.48		-	$	3,794,505
Forfeited		-		$	-		-	$	-

Outstanding at December 31, 2018		37,500		$	8.36		2.24	$	349,950

Vested and Exercisable at December 31, 2018		27,500		$	8.37		2.26	$	256,313

The aggregate intrinsic value of options outstanding and options exercisable at December 31, 2018 is calculated as the difference between the exercise price of the underlying options and the market price of the Company’s Common Stock for the options that had exercise prices that were lower than the $17.69 closing price of the Company’s Common Stock on December 31, 2018. The total intrinsic value of options exercised in the year ended December 31, 2018 was $3,794,505, determined as of the date of exercise.

Participants in the 2005 and 2014 Plans may exercise their outstanding vested options, in whole or in part, by having the Company reduce the number of shares otherwise issuable by a number of shares having a fair market value equal to the exercise price of the option being exercised (“Net Exercise”), or by exchanging a number of shares owned for a period of greater than one year having a fair market value equal to the exercise price of the option being exercised (“Share Exchange”). The Company received cash proceeds of $90,640 from the exercise of options for the purchase of 15,250 shares of common stock during the year ended December 31, 2018. The Company received 7,855 shares from the exercise of options under a Share Exchange for the purchase of 30,000 shares of common stock during the year ended December 31, 2018. The remaining 258,400 options exercised during the year ended December 31, 2018 were Net Exercises, resulting in the issuance of 94,647 shares of common stock. The Company received cash proceeds of $77,927 from the exercise of options for the purchase of 13,750 shares of common stock during the year ended December 31, 2017. The remaining 7,850 options exercised during the year ended December 31, 2017 were Net Exercises.

As of December 31, 2018, the estimated fair value of unamortized compensation cost related to unvested stock option awards was approximately $1,000. Unamortized compensation cost as of December 31, 2018 is expected to be recognized over a remaining weighted-average vesting period of 0.19 years.

As of December 31, 2018, there were 466,124 shares reserved for grants under the 2014 Plan.

Restricted Stock Awards

A summary of the restricted common stock activity under the Company’s 2014 Plan for the year ended December 31, 2018 is as follows:

Restricted Stock Awards	Shares			Weighted Average Grant Date Fair Value per Share		Aggregate Fair Value

Balance at January 1, 2018		47,337		$	14.35	$	679,180

Granted		92,004		$	18.67	$	1,717,958
Vested		(15,752	)	$	14.07	$	(221,613	)
Forfeited		(3,090	)	$	15.00	$	(46,350	)

Balance at December 31, 2018		120,499		$	17.66	$	2,129,175

Fair value was calculated using the closing price of the Company’s Common Stock on the grant date. For the year ended December 31, 2018 and 2017, stock-based compensation for these grants was approximately $697,000 and $232,000, respectively, which is included in other operating expenses on the accompanying consolidated statements of income and comprehensive income (loss). These amounts reflect the Company’s accounting expense and do not correspond to the actual value that will be recognized by the directors, executives and employees.

13. Statutory Financial Information and Accounting Policies

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

13. Statutory Financial Information and Accounting Policies

For regulatory purposes, KICO prepares its statutory basis financial statements in accordance with Statements of Statutory Accounting Principles (“statutory basis” or “SAP”) as promulgated by the National Association of Insurance Commissioners (the “NAIC”) and the prescribed or permitted practices of the New York State Department of Financial Services (the “DFS”). The more significant SAP variances from GAAP are as follows:


•	Policy acquisition costs are charged to operations in the year such costs are incurred, rather than being deferred and amortized as premiums are earned over the terms of the policies.

•	Ceding commission revenues are earned when ceded premiums are written except for ceding commission revenues in excess of anticipated acquisition costs, which are deferred and amortized as ceded premiums are earned. GAAP requires that all ceding commission revenues be earned as the underlying ceded premiums are earned over the term of the reinsurance agreements.

•	Certain assets including certain receivables, a portion of the net deferred tax asset, prepaid expenses and furniture and equipment are not admitted.

•	Investments in fixed-maturity securities are valued at NAIC value for statutory financial purposes, which is primarily amortized cost. GAAP requires certain investments in fixed-maturity securities classified as available-for-sale, to be reported at fair value.

•	Certain amounts related to ceded reinsurance are reported on a net basis within the statutory basis financial statements. GAAP requires these amounts to be shown gross.
•	For SAP purposes, changes in deferred income taxes relating to temporary differences between net income for financial reporting purposes and taxable income are recognized as a separate component of gains and losses in surplus rather than included in income tax expense or benefit as required under GAAP.

State insurance laws restrict the ability of KICO to declare dividends. These restrictions are related to surplus and net investment income. Dividends are restricted to the lesser of 10% of surplus or 100% of investment income (on a statutory accounting basis) for the trailing 36 months, net of dividends paid by KICO during such period. State insurance regulators require insurance companies to maintain specified levels of statutory capital and surplus. Generally, dividends may only be paid out of unassigned surplus, and the amount of an insurer’s unassigned surplus following payment of any dividends must be reasonable in relation to the insurer’s outstanding liabilities and adequate to meet its financial needs. For the years ended December 31, 2018 and 2017, KICO paid dividends to Kingstone of $3,600,000 and $2,900,000, respectively. On February 19, 2019, KICO’s Board of Directors approved a cash dividend of $2,000,000 to Kingstone, which was paid on February 20, 2019. For the years ended December 31, 2018 and 2017, KICO recorded statutory basis net income of $3,801,498 and $7,907,743, respectively. At December 31, 2018 and 2017, KICO reported statutory basis surplus as regards policyholders of $98,745,944 and $101,290,282, respectively, as filed with the DFS.

14. Risk Based Capital

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

14. Risk Based Capital

State insurance departments impose risk-based capital (“RBC”) requirements on insurance enterprises. The RBC Model serves as a benchmark for the regulation of insurance companies by state insurance regulators. RBC provides for targeted surplus levels based on formulas, which specify various weighting factors that are applied to financial balances or various levels of activity based on the perceived degree of risk, and are set forth in the RBC requirements. Such formulas focus on four general types of risk: (a) the risk with respect to the company’s assets (asset or default risk); (b) the risk of default on amounts due from reinsurers, policyholders, or other creditors (credit risk); (c) the risk of underestimating liabilities from business already written or inadequately pricing business to be written in the coming year (underwriting risk); and, (d) the risk associated with items such as excessive premium growth, contingent liabilities, and other items not reflected on the balance sheet (off-balance sheet risk). The amount determined under such formulas is called the authorized control level RBC (“ACL”).

The RBC guidelines define specific capital levels based on a company’s ACL that are determined by the ratio of the company’s total adjusted capital (“TAC”) to its ACL. TAC is equal to statutory capital, plus or minus certain other specified adjustments. The Company’s TAC was above the ACL for each of the last two years and is in compliance with RBC requirements as of December 31, 2018 and 2017.

- Definition

The entire disclosure for banks, savings institutions, and credit unions, for regulatory capital requirements imposed by the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the Office of Thrift Supervision (OTS) or for any state imposed capital requirements, as applicable. The disclosure may include (1) a description of regulatory capital requirements (a) for capital adequacy purposes and (b) established by the prompt corrective action provisions of Section 38 of the Federal Depository Insurance Act; (2) the actual or possible material effects of noncompliance with such requirements; (3) whether the entity is in compliance with the regulatory capital requirements including (a) required and actual ratios and amounts of Tier 1 leverage, Tier 1 risk-based, and total risk-based capital, tangible capital (for savings institutions), and Tier 3 capital for market risk (for certain banks and bank holding companies), (b) factors that may significantly affect capital adequacy; (4) the prompt corrective action category in which the entity was classified as of its most recent notification; (5) whether management believes any conditions or events since notification have changed the entity's category. Also may include additional information that might be disclosed in situations where substantial doubt about the entity's ability to continue as a going concern for a reasonable period of time.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1C
-URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958572-112826

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1D
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+ Details

15. Income Taxes

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

15. Income Taxes

The Company files a consolidated U.S. federal income tax return that includes all wholly owned subsidiaries. State tax returns are filed on a consolidated or separate return basis depending on applicable laws. The Company records adjustments related to prior years’ taxes during the period when they are identified, generally when the tax returns are filed. The effect of these adjustments on the current and prior periods (during which the differences originated) is evaluated based upon quantitative and qualitative factors and are considered in relation to the financial statements taken as a whole for the respective periods.

The provision for income taxes is comprised of the following:

Years ended December 31,	2018			2017

Current federal income tax expense	$	(74,001	)	$	4,317,686
Current state income tax (benefit) expense		(6,784	)		7,353
Deferred federal and state income tax benefit		(5,398	)		(1,809	)
Income tax (benefit) expense	$	(86,183	)	$	4,323,230

A reconciliation of the federal statutory rate to the Company’s effective tax rate is as follows:

Years ended December 31,	2018					2017
Computed expected tax expense	$	631,483		21.0	%	$	5,008,400		35.0	%
Change in enacted tax rates on net deferred tax liabilities		-		-			(405,218	)	(2.8	)
State taxes, net of Federal benefit		(377,884	)	(12.6	)		(101,858	)	(0.7	)
State valuation allowance		390,976		13.0			124,486		0.9
Benefit of lower tax brackets		-		-			(100,000	)	(0.7	)
Permanent differences
Dividends received deduction		(85,703	)	(2.9	)		(138,197	)	(1.0	)
Non-taxable investment income		(40,861	)	(1.4	)		(85,684	)	(0.6	)
Excess benefit from stock-based compensation		(569,459	)	(18.9	)		-		-
Stock-based compensation		(16,960	)	(0.5	)		(25,821	)	(0.2	)
Other permanent differences		42,496		1.4			46,962		0.3
Prior year tax matters		(61,415	)	(2.0	)		4,172		-
Other		1,144		-			(4,012	)	-
Income tax (benefit) expense, as reported	$	(86,183	)	(2.9	)%	$	4,323,230		30.2	%

Deferred tax assets and liabilities are determined using the enacted tax rates applicable to the period the temporary differences are expected to be recovered. Accordingly, the current period income tax provision can be affected by the enactment of new tax rates. The net deferred income taxes on the balance sheets reflect temporary differences between the carrying amounts of the assets and liabilities for financial reporting purposes and income tax purposes, tax effected at various rates depending on whether the temporary differences are subject to federal taxes, state taxes, or both.

On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted by the U.S. federal government. The Company has accounted for the material impacts of the Tax Act by re-measuring its deferred tax assets/(liabilities) at the 21% enacted tax rate as of December 31, 2017. As of December 31, 2017, the impact of the change in tax rate was a decrease in net deferred income tax liabilities of $405,218 with a corresponding increase in deferred income tax benefit. Upon completion of the 2017 U.S. income tax return in 2018, the Company did not identify any additional re-measurement adjustments to its recorded deferred tax liabilities and the one-time transition tax.

Deferred income tax liability for unrealized gains on available-for-sale securities that were re-measured due to the Act resulted in a stranded tax effect within AOCI. Due to the effect of the tax rate change being recorded through continuing operations as required under ASC 740. On February 14, 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”), which allows for the reclassification of the stranded tax effects as a result of the Act from AOCI to retained earnings and requires certain other disclosures. The Company chose to early adopt the provisions of ASU 2018-02 and recorded a one-time reclassification of $182,912 from AOCI to retained earnings as of December 31, 2017 for the stranded tax effects resulting from the newly enacted corporate tax rate. The amount of the reclassification was the difference between the historical corporate tax rate and the newly enacted 21% corporate tax rate (see the accompanying consolidated statement of stockholders’ equity for reclassification of the stranded tax effects).

Significant components of the Company’s deferred tax assets and liabilities are as follows:

	December 31,			December 31,
	2018			2017

Deferred tax asset:
Net operating loss carryovers (1)	$	90,438		$	103,655
Claims reserve discount		343,905			300,005
Unearned premium		3,145,682			2,431,301
Deferred ceding commission revenue		564,202			895,947
Other		383,733			382,522
Total deferred tax assets		4,527,960			4,113,430

Deferred tax liability:
Investment in KICO (2)		759,543			759,543
Deferred acquisition costs		3,760,625			3,117,920
Intangibles		140,700			212,100
Depreciation and amortization		664,194			328,735
Net unrealized (losses) gains of securities - available-for-sale		(1,151,335	)		295,474
Total deferred tax liabilities		4,173,727			4,713,772

Net deferred income tax asset (liability)	$	354,233		$	(600,342	)

(1) The deferred tax assets from net operating loss carryovers are as follows:

	December 31,			December 31,
Type of NOL	2018			2017			Expiration
State only (A)	$	1,305,365		$	824,996		December 31, 2038
Valuation allowance		(1,217,027	)		(725,541	)
State only, net of valuation allowance		88,338			99,455
Amount subject to Annual Limitation, federal only (B)		2,100			4,200		December 31, 2019
Total deferred tax asset from net operating loss carryovers	$	90,438		$	103,655

(A) Kingstone generates operating losses for state purposes and has prior year NOLs available. The state NOL as of December 31, 2018 and 2017 was approximately $20,083,000 and $12,692,000, respectively. KICO, the Company’s insurance underwriting subsidiary, is not subject to state income taxes. KICO’s state tax obligations are paid through a gross premiums tax, which is included in the consolidated statements of income and comprehensive income within other underwriting expenses. Kingstone has recorded a valuation allowance due to the uncertainty of generating enough state taxable income to utilize 100% of the available state NOLs over their remaining lives, which expire between 2027 and 2038.

(B) The Company has a remaining NOL of $10,000 that is subject to Internal Revenue Code Section 382, which places a limitation on the utilization of the federal net operating loss to approximately $10,000 per year (“Annual Limitation”) as a result of a greater than 50% ownership change of the Company in 1999. The remaining loss subject to the Annual Limitation will expire on December 31, 2019.

(2) Deferred tax liability - investment in KICO

On July 1, 2009, the Company completed the acquisition of 100% of the issued and outstanding common stock of KICO (formerly known as Commercial Mutual Insurance Company (“CMIC”)) pursuant to the conversion of CMIC from an advance premium cooperative insurance company to a stock property and casualty insurance company. Pursuant to the plan of conversion, the Company acquired a 100% equity interest in KICO, in consideration for the exchange of $3,750,000 principal amount of surplus notes of CMIC. In addition, the Company forgave all accrued and unpaid interest on the surplus notes as of the date of conversion. As of the date of acquisition, unpaid accrued interest on the surplus notes along with the accretion of the discount on the original purchase of the surplus notes totaled $2,921,319 (collectively the “Untaxed Interest”). As of the date of acquisition, the deferred tax liability on the Untaxed Interest was $1,169,000. Under GAAP guidance for business combinations, a temporary difference with an indefinite life exists when the parent company has a lower carrying value of its subsidiary for income tax purposes. The deferred tax liability was reduced to $759,543 upon the reduction of federal income tax rates as of December 31, 2017. The Company is required to maintain its deferred tax liability of $759,543 related to this temporary difference until the stock of KICO is sold, or the assets of KICO are sold or KICO and the parent are merged.

The table below reconciles the changes in net deferred income tax assets (liabilities) to the deferred income tax provision for the year ended December 31, 2018:

Change in net deferred income tax assets	$	(954,575	)
Deferred tax benefit allocated to other comprehensive (loss) income		(949,177	)
Deferred income tax benefit	$	(5,398	)

In assessing the valuation of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. No valuation allowance against deferred tax assets has been established, except for NOL limitations, as the Company believes it is more likely than not the deferred tax assets will be realized based on the historical taxable income of KICO, or by offset to deferred tax liabilities.

The Company had no material unrecognized tax benefit and no adjustments to liabilities or operations were required. There were no material interest or penalties related to income taxes that have been accrued or recognized as of and for the years ended December 31, 2018 and 2017. If any had been recognized these would be reported in income tax expense.

Generally, taxing authorities may examine the Company’s tax returns for the three years from the date of filing. The Company’s tax returns for the years ended December 31, 2014 through December 31, 2017 remain subject to examination. The Company’s federal income tax return for the year ended December 31, 2016 has been examined by the Internal Revenue Service and was accepted as filed.

16. Employee Benefit Plans

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

16. Employee Benefit Plans

Employee Profit Sharing Plan

The Company maintained a discretionary employee profit sharing plan (the “Profit Sharing Plan”) available to full-time employees who were employed as of December 31. For the years ended December 31, 2018 and 2017, the Profit Sharing Plan called for a bonus to be paid based on a formula that is tied to the annual GAAP combined ratio (“Combined Ratio”). The maximum the bonus can be is 25% of eligible wages at a Combined Ratio of 70%. The bonus decreased by 1% for each percentage point increase in the Combined Ratio. There is a minimum bonus of 5% at a Combined Ratio of 90% and above. The bonus is allocated 35% to the employees’ 401(k) account and 65% as cash through payroll. The Company incurred approximately $445,000 and $989,000 of expense for the years ended December 31, 2018 and 2017, respectively, related to the Profit Sharing Plan, which is recorded in other operating expenses on the accompanying consolidated statements of income and comprehensive income (loss).

Employee Bonus Plan

In November 2018, the Company’s Board of Directors approved a new discretionary employee bonus plan (“Bonus Plan”) to replace the existing Profit Sharing Plan to be effective as of January 1, 2019. Eligible employees can receive a target bonus rate of between 12% and 30% of base salary depending on their position. The target bonus rate is subject to adjustment depending on annual performance evaluation scores. The Bonus Plan is funded through a point system whereby up to 60 points are funded by a target return on investment (“Target ROE”) sliding scale and up to 40 points are funded by achieving various annual corporate goals as approved in advance by the Company’s Board of Directors. A maximum of 60 points can be achieved with a Target ROE of 14%. The bonus is decreased by six points for each percentage point decease in Target ROE. The minimum of six points can be achieved with Target ROE of 5%.

401 (k) Plan

The Company maintains a salary reduction plan under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”) for its qualified employees. The Company matches 100% of each participant’s contribution up to 4% of the participant’s eligible contribution. The Company, at its discretion, may allocate an amount for additional contributions (“Additional Contributions”) to the 401(k) Plan included in the Profit Sharing Plan as discussed above. The Company incurred approximately $247,000 and $545,000 of expense for the years ended December 31, 2018 and 2017, respectively, related to the 401(k) Plan, which is recorded in other operating expenses on the accompany consolidated statements of income and comprehensive income (loss). For the years ended December 31, 2018 and 2017, Additional Contributions totaled approximately $-0- and $309,000, respectively.

Deferred Compensation Plan

On June 18, 2018, the Company adopted the Kingstone Companies, Inc. Deferred Compensation Plan (the "Deferred Compensation Plan"). The Deferred Compensation Plan is offered to a select group (“Participants”), consisting of management and highly compensated employees as a method of recognizing and retaining such Participants. The Deferred Compensation Plan provides for eligible Participants to elect to defer up to 75% of their base compensation and up to 100% of bonuses and other compensation and to have such deferred amounts deemed to be invested in specified investment options. In addition to the Participant deferrals, the Company may choose to make matching contributions to some or all of the Participants in the Deferred Compensation Plan to the extent the Participant did not receive the maximum matching or non-elective contributions permissible under the Company’s 401(k) Plan due to limitations under the Internal Revenue Code or the 401(k) Plan. Participants may elect to receive payment of their account balances in a single cash payment or in annual installments for a period of up to ten years. The first payroll subject to the Deferred Compensation Plan was in July 2018. The deferred compensation liability as of December 31, 2018 amounted to $298,638 and is recorded in accounts payable, accrued expenses and other liabilities in the consolidated balance sheets. The Company made voluntary contributions of $24,957 for the year ended December 31, 2018, which are recorded in other operating expenses in the consolidated statements of income and comprehensive (loss) income.

17. Commitments and Contingencies

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

17. Commitments and Contingencies

Litigation

From time to time, the Company may be involved in various legal proceedings in the ordinary course of business. For example, to the extent a claim asserted by a third party in a lawsuit against one of the Company’s insureds covered by a particular policy, the Company may have a duty to defend the insured party against the claim. These claims may relate to bodily injury, property damage or other compensable injuries as set forth in the policy. Such proceedings are considered in estimating the liability for loss and LAE expenses. The Company is currently not subject to any other pending legal proceedings that management believes are likely to have a material adverse effect on the consolidated financial statements.

Office Lease

The Company is a party to a non-cancellable operating lease, dated March 27, 2015, for its office facility for KICO located in Valley Stream, New York. In June 2016, the Company entered into a lease modification agreement. The original lease had a term of seven years and nine months. The lease modification increased the space occupied by KICO and extended the lease term to seven years and nine months to be measured from the additional premises commencement date. The additional premises commencement date was September 19, 2016, and additional rent was payable beginning March 19, 2017. The original lease commencement date was July 1, 2015 and rent commencement began January 1, 2016.

In addition to the base rental costs, occupancy lease agreements generally provide for rent escalations resulting from increased assessments from real estate taxes and other charges. Rent expense under the lease is recognized on a straight-line basis over the lease term. At December 31, 2018, cumulative rent expense exceeded cumulative rent payments by $91,800. This difference is recorded as deferred rent and is included in accounts payable, accrued expenses and other liabilities in the accompanying consolidated balance sheets.

As of December 31, 2018, aggregate future minimum rental commitments under this agreement are as follows:

For the Year
Ending
December 31,		Total
	2019	$	169,861
	2020		175,806
	2021		181,959
	2022		188,382
	2023		194,919
	Thereafter		49,145
	Total	$	960,018

Rent expense for the years ended December 31, 2018 and 2017 amounted to $165,368, and is included in the consolidated statements of income and comprehensive (loss) income within other underwriting expenses.

Employment Agreements

Barry Goldstein

(1) Agreement in effect for the years ended December 31, 2017 and 2018

On January 20, 2017, the Company and Mr. Goldstein, the Company’s President, Chairman of the Board and Chief Executive Officer through December 31, 2018, entered into a new employment agreement (the “2017 Goldstein Employment Agreement”). The 2017 Goldstein Employment Agreement was effective as of January 1, 2017 and was originally scheduled to expire on December 31, 2019 (see below for Agreement in effect as January 1, 2019).

Pursuant to the 2017 Goldstein Employment Agreement, Mr. Goldstein was entitled to receive an annual base salary of $630,000 and an annual bonus equal to 6% of the Company's consolidated income from operations before taxes, exclusive of net investment income (loss) and net realized gains (losses) on investments. In addition, pursuant to the 2017 Goldstein Employment Agreement, Mr. Goldstein was entitled to a long-term compensation payment ("LTC") of between $945,000 and $2,835,000 in the event the Company's adjusted book value per share as defined, increased by at least an average of 8% per annum as of December 31, 2019 as compared to December 31, 2016 (with the maximum LTC payment being due if the average per annum increase is at least 14%). Accrued LTC compensation expense (credit) of $(247,311) and $945,000 for the years ended December 31, 2018 and 2017 is included in other operating expenses on the accompanying consolidated statements of income and comprehensive (loss) income.

Further, pursuant to the 2017 Goldstein Employment Agreement, in the event that Mr. Goldstein's employment is terminated by the Company without cause or he resigns for good reason each as defined, Mr. Goldstein would be entitled to receive his base salary, the 6% bonus and the LTC payment for the remainder of the term. Mr. Goldstein would be entitled, under certain circumstances, to a payment equal to one and one-half times his then annual salary and the target LTC payment of $1,890,000 in the event of the termination of his employment following a change of control of the Company.

(2) Agreement in effect as of January 1, 2019

On October 16, 2018, the Company entered into an amended and restated employment agreement with Mr. Goldstein effective as of January 1, 2019 and expiring on December 31, 2021 (the “Amended Employment Agreement”). Pursuant to the Amended Employment Agreement, Mr. Goldstein stepped down as Chief Executive Officer on January 1, 2019 and was named Executive Chairman of the Board.

Mr. Goldstein will be entitled to receive an annual base salary of $636,500 for the calendar year 2019 and $500,000 for each of the calendar years 2020 and 2021. In addition, Mr. Goldstein is eligible to receive an annual performance bonus equal to 3% of the Company’s consolidated income from operations before taxes, exclusive of net investment income (loss) and net realized gains (losses) on investments. In addition, Mr. Goldstein will continue to be entitled to a long-term compensation award (“LTC”) (which is a continuation of the previous terms under the 2017 Goldstein Employment Agreement) of between $945,000 and $2,835,000 based on a specified minimum increase in the Company’s adjusted book value per share, as defined, as of December 31, 2019 as compared to December 31, 2016 (with the maximum LTC payment being due if the average per annum increase is at least 14%). Furthermore, in the event that Mr. Goldstein’s employment is terminated by the Company without cause or he resigns for good reason, each as defined, Mr. Goldstein would be entitled to receive separation payments equal to his then applicable base salary, the 3% bonus and the LTC payment for the remainder of the term. Mr. Goldstein would be entitled, under certain circumstances, to a payment equal to three times his then annual salary and the target LTC payment in the event of the termination of his employment following a change of control of the Company. Mr. Goldstein will also be entitled to receive a grant, under the terms of the 2014 Plan, during the first 30 days of January 2020, with respect to a number of shares of restricted stock determined by dividing $436,500 by the fair market value of the Company stock on the date of grant. The January 2020 grant will become vested with respect to 50% of the award on each of December 31, 2020 and December 31, 2021 based on continued provision of services on each vesting date. In addition, Mr. Goldstein will be entitled to receive a grant, under the 2014 Plan, during the first 30 days of 2021, with respect to a number of shares of restricted stock determined by dividing $236,500 by the fair market value of the Company stock on the date of grant. The January 2021 grant will become vested as of December 31, 2021 based on continued provision of services on the vesting date.

Dale A. Thatcher

(1) Agreement in effect for the year ended December 31, 2018

On March 14, 2018, the Company and Dale A. Thatcher, a director of the Company, entered into an employment agreement (the “Thatcher Employment Agreement”) pursuant to which Mr. Thatcher serves as the Company’s Chief Operating Officer. Mr. Thatcher also serves as KICO’s President. The Thatcher Employment Agreement became effective as of March 15, 2018 and expired on December 31, 2018.

Pursuant to the Thatcher Employment Agreement, Mr. Thatcher is entitled to receive a base salary of $500,000 per annum and a minimum bonus equal to 15% of his base salary. Concurrently with the execution of the Thatcher Employment Agreement, the Company granted to Mr. Thatcher 35,715 shares of restricted Common Stock under the 2014 Plan. The shares granted will vest in three equal installments on each of the three anniversaries following the grant date, subject to the terms of the restricted stock grant agreement between the Company and Mr. Thatcher.

(2) Agreement in effect as of January 1, 2019

On October 16, 2018, the Company and Mr. Thatcher entered into an Employment Agreement effective as of January 1, 2019 and expiring on December 31, 2021 (the “2019 Thatcher Employment Agreement”). Pursuant to the 2019 Thatcher Employment Agreement, Mr. Thatcher was promoted to succeed Mr. Goldstein as Chief Executive Officer effective January 1, 2019. Mr. Thatcher will continue to serve as a director and will remain President of KICO.

Mr. Thatcher will be entitled to receive an annual base salary of $500,000 for 2019, $630,000 for 2020 and no increase in 2021. In addition, Mr. Thatcher is eligible to receive an annual performance bonus equal to 3% of the Company’s consolidated income from operations before taxes, exclusive of the net investment income (loss) and net realized gains (losses) on investments. In the event that Mr. Thatcher’s employment is terminated by the Company without cause or he resigns for good reason, each as defined, Mr. Thatcher would be entitled to receive separation payments equal to his then applicable base salary and the 3% bonus for the remainder of the term. Mr. Thatcher will also be entitled to receive a grant, under the terms of the 2014 Equity Plan, with respect to a number of shares of restricted stock in each of 2019, 2020 and 2021 determined by dividing $750,000, $1,250,000 and $1,500,000, respectively, by the fair market value of the Company’s stock on the date of grant. Each grant vests ratably over a three-year period from the date of grant.

Approval Required for Transactions with Subsidiary

On July 1, 2009, Kingstone completed the acquisition of 100% of the issued and outstanding common stock of KICO (formerly known as Commercial Mutual Insurance Company (“CMIC”)) pursuant to the conversion of CMIC from an advance premium cooperative to a stock property and casualty insurance company. Pursuant to the plan of conversion, Kingstone acquired a 100% equity interest in KICO. In connection with the plan of conversion of CMIC, the Company has agreed with the DFS that any intercompany transaction between itself and KICO must be filed with the DFS 30 days prior to implementation.

18. Earnings Per Common Share

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

18. Earnings Per Common Share

Basic net earnings per common share is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding. Diluted earnings per common share reflect, in periods in which they have a dilutive effect, the impact of common shares issuable upon exercise of stock options as well as non-vested restricted stock awards. The computation of diluted earnings per common share excludes those options with an exercise price in excess of the average market price of the Company’s common shares during the periods presented.

The computation of diluted earnings per common share excludes outstanding options in periods where the exercise of such options would be anti-dilutive. For the years ended December 31, 2018 and 2017, the inclusion of -0- options, in the computation of diluted earnings per common share would have been anti-dilutive for the periods and, as a result, the weighted average number of common shares used in the calculation of diluted earnings per common share has not been adjusted for the effect of such options.

The reconciliation of the weighted average number of common shares used in the calculation of basic and diluted earnings per common share follows:

	Years ended
	December 31,
	2018		2017

Weighted average number of shares outstanding		10,686,813		10,388,440

Effect of dilutive securities, common share equivalents:
Stock options		19,823		188,983
Restricted stock awards		10,250		4,154

Weighted average number of shares outstanding,
used for computing diluted earnings per share		10,716,886		10,581,577

19. Subsequent Events

12 Months Ended

Dec. 31, 2018

Weighted average amortization period of identified intangible assets of finite useful life

19. Subsequent Events

The Company has evaluated events that occurred subsequent to December 31, 2018 through March 15, 2019, the date these consolidated financial statements were issued for matters that required disclosure or adjustment in these consolidated financial statements.

Dividends Declared and Paid

On February 14, 2019, the Company’s Board of Directors approved a dividend of $.10 per share payable in cash on March 15, 2019 to stockholders of record as of February 28, 2019.

20. Quarterly Financial Data

12 Months Ended

Dec. 31, 2018

Quarterly Financial Information Disclosure [Abstract]

20. Quarterly Financial Data

The following is a summary of unaudited quarterly results of operations for the years ended December 31, 2018 and 2017:

	2018
	March 31,			June 30,			September 30,		December 31,			Total

Net premiums earned	$	22,837,617		$	24,104,614		$	27,533,907	$	28,938,577		$	103,414,715
Ceding commission revenue		1,695,158			1,691,168			1,044,529		901,775			5,332,630
Net investment income		1,383,989			1,556,866			1,602,371		1,643,022			6,186,248
Net (losses) gains on investments		(523,127	)		(106,733	)		352,025		(2,218,022	)		(2,495,857	)
Total revenues		25,701,870			27,546,186			30,885,909		29,637,933			113,771,898
Loss and loss adjustment expenses		17,266,330			11,176,085			13,296,708		16,556,082			58,295,205
Commission expense and
other underwriting expenses		10,831,451			11,093,175			11,788,002		12,572,851			46,285,479
Net income (loss)		(2,717,934	)		2,757,297			3,933,730		(879,847	)		3,093,246
Basic earnings (loss) per share	$	(0.28	)	$	0.26		$	0.37	$	(0.08	)	$	0.29
Diluted earnings (loss) per share	$	(0.28	)	$	0.25		$	0.36	$	(0.08	)	$	0.29

	2017
	March 31,			June 30,		September 30,		December 31,			Total

Net premiums earned	$	16,369,748		$	16,953,727	$	21,514,408	$	22,513,140		$	77,351,023
Ceding commission revenue		3,184,452			3,305,938		1,717,610		1,725,133			9,933,133
Net investment income		857,800			1,026,004		1,033,307		1,215,475			4,132,586
Net realized gain (loss) on investments		(54,506	)		130,423		20,998		(12,602	)		84,313
Total revenues		20,647,194			21,724,251		24,614,653		25,783,212			92,769,310
Loss and loss adjustment expenses		8,292,996			7,454,922		7,073,323		11,364,296			34,185,537
Commission expense and
other underwriting expenses		9,101,395			9,301,182		9,975,938		10,919,353			39,297,868
Net income		1,470,580			2,510,392		4,073,921		1,931,592			9,986,485
Basic earnings per share	$	0.15		$	0.24	$	0.38	$	0.18		$	0.96
Diluted earnings per share	$	0.15		$	0.23	$	0.38	$	0.18		$	0.94

Due to changes in number of shares outstanding from quarter to quarter, the total earnings per share of the four quarters may not necessarily equal the earnings per share for the year.

2. Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2018

Summary Of Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Principles of Consolidation

Revenue Recognition

Net Premiums Earned

Ceding Commission Revenue

Loss and Loss Adjustment Expenses ("LAE") Reserves

Reinsurance

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The Company maintains its cash balances at several financial institutions.

Investments

Premiums Receivable

Deferred Policy Acquisition Costs

Intangible Assets

Property and Equipment

Income Taxes

On December 22, 2017, the Tax Cuts and Jobs Act of 2017 was enacted (see Note 15 - Income Taxes).

Assessments

Concentration and Credit Risk

As of December 31, 2018 and 2017, the Company’s cash equivalents were as follows:

	December 31,		December 31,
	2018		2017

Collateralized bank repurchase agreement (1)	$	568,123	$	10,249,985
Money market funds		15,012,559		35,874,700
Total	$	15,580,682	$	46,124,685

Direct premiums earned from lines of business in excess of 10% of the total subject the Company to concentration risk for the years ended December 31, 2018 and 2017 as follows:

	Years ended December 31,
	2018			2017
Personal Lines		80.7	%		77.2	%
Commercial Lines		11.6	%		12.2	%
Livery physical damage		n/a			10.3	%
Total premiums earned subject to concentration		92.3	%		99.7	%
Premiums earned not subject to concentration		7.7	%		0.3	%
Total premiums earned		100.0	%		100.0	%

Use of Estimates

Earnings per share

Advertising Costs

Stock-based Compensation

Compensated Absences

Comprehensive Income (Loss)

Accounting Changes

Recent Accounting Pronouncements

2. Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2018

Accounting Policies And Basis Of Presentation Tables Abstract

Summary of deposits of cash equivalents

	December 31,		December 31,
	2018		2017

Collateralized bank repurchase agreement (1)	$	568,123	$	10,249,985
Money market funds		15,012,559		35,874,700
Total	$	15,580,682	$	46,124,685

Schedule of Concentration Risk

	Years ended December 31,
	2018			2017
Personal Lines		80.7	%		77.2	%
Commercial Lines		11.6	%		12.2	%
Livery physical damage		n/a			10.3	%
Total premiums earned subject to concentration		92.3	%		99.7	%
Premiums earned not subject to concentration		7.7	%		0.3	%
Total premiums earned		100.0	%		100.0	%

3. Investments (Tables)

12 Months Ended

Dec. 31, 2018

Investments Tables Abstract

Schedule of Available for Sale Securities

	December 31, 2018
														Net
		Cost or		Gross		Gross Unrealized Losses						Estimated		Unrealized
		Amortized		Unrealized		Less than 12			More than 12			Fair		Gains/
Category		Cost		Gains		Months			Months			Value		(Losses)

Fixed-Maturity Securities:
U.S. Treasury securities and
obligations of U.S. government
corporations and agencies		$	8,222,050	$	26,331	$	(28,000	)	$	-		$	8,220,381	$	(1,669	)

Political subdivisions of States,
Territories and Possessions			6,339,540		50,903		(12,327	)		(36,508	)		6,341,608		2,068

Corporate and other bonds
Industrial and miscellaneous			119,078,698		123,740		(2,775,540	)		(676,605	)		115,750,293		(3,328,405	)

Residential mortgage and other
asset backed securities (1)			21,790,973		236,502		(231,229	)		(331,012	)		21,465,234		(325,739	)
Total		$	155,431,261	$	437,476	$	(3,047,096	)	$	(1,044,125	)	$	151,777,516	$	(3,653,745	)

(1)

	December 31, 2017
													Net
	Cost or		Gross		Gross Unrealized Losses						Estimated		Unrealized
	Amortized		Unrealized		Less than 12			More than 12			Fair		Gains/
Category	Cost		Gains		Months			Months			Value		(Losses)

Fixed-Maturity Securities:
Political subdivisions of States,
Territories and Possessions	$	11,096,122	$	250,135	$	(30,814	)	$	-		$	11,315,443	$	219,321

Corporate and other bonds
Industrial and miscellaneous		87,562,631		1,189,207		(269,857	)		(340,516	)		88,141,465		578,834

Residential mortgage and other
asset backed securities (1)		20,463,353		305,499		(48,482	)		(189,022	)		20,531,348		67,995
Total	$	119,122,106	$	1,744,841	$	(349,153	)	$	(529,538	)	$	119,988,256	$	866,150

(1)

	December 31, 2018				December 31, 2017
	Amortized		Estimated		Amortized		Estimated
Remaining Time to Maturity	Cost		Fair Value		Cost		Fair Value

Less than one year	$	6,742,519	$	6,738,014	$	2,585,479	$	2,595,938
One to five years		47,038,838		46,640,012		31,716,345		32,065,197
Five to ten years		76,884,505		74,290,076		62,702,945		63,129,543
More than ten years		2,974,426		2,644,180		1,653,984		1,666,230
Residential mortgage and other asset backed securities		21,790,973		21,465,234		20,463,353		20,531,348
Total	$	155,431,261	$	151,777,516	$	119,122,106	$	119,988,256

Schedule of Available for Sale Securities by contractual maturity

	December 31, 2018
			Gross		Gross			Estimated
Category	Cost		Gains		Losses			Fair Value

Equity Securities:
Preferred stocks	$	6,694,754	$	-	$	(541,798	)	$	6,152,956
Common stocks and exchange
traded mutual funds		11,611,232		99,817		(1,291,389	)		10,419,660
Total	$	18,305,986	$	99,817	$	(1,833,187	)	$	16,572,616

	December 31, 2017
			Gross		Gross			Estimated
Category	Cost		Gains		Losses			Fair Value

Equity Securities:
Preferred stocks	$	7,081,099	$	60,867	$	(141,025	)	$	7,000,941
Common stocks and exchange
traded mutual funds		6,680,742		841,250		(236,735	)		7,285,257
Total	$	13,761,841	$	902,117	$	(377,760	)	$	14,286,198

Schedule of Other Investments

	December 31, 2018							December 31, 2017
			Gross			Estimated				Gross		Estimated
Category	Cost		Losses			Fair Value		Cost		Gains/(Losses)		Fair Value

Other Investments:
Hedge fund	$	1,999,381	$	(144,156	)	$	1,855,225	$	-	$	-	$	-
Total	$	1,999,381	$	(144,156	)	$	1,855,225	$	-	$	-	$	-

Schedule of Held to Maturity Securities

	December 31, 2018

	Cost or		Gross		Gross Unrealized Losses						Estimated		Net
	Amortized		Unrealized		Less than 12			More than 12			Fair		Unrealized
Category	Cost		Gains		Months			Months			Value		Gains/(Losses)

Held-to-Maturity Securities:
U.S. Treasury securities	$	729,507	$	147,532	$	(3,964	)	$	-		$	873,075	$	143,568

Political subdivisions of States,
Territories and Possessions		998,803		33,862		-			-			1,032,665		33,862

Corporate and other bonds
Industrial and miscellaneous		2,494,545		38,461		(1,425	)		(10,905	)		2,520,676		26,131

Total	$	4,222,855	$	219,855	$	(5,389	)	$	(10,905	)	$	4,426,416	$	203,561

	December 31, 2017

	Cost or		Gross		Gross Unrealized Losses						Estimated		Net
	Amortized		Unrealized		Less than 12			More than 12			Fair		Unrealized
Category	Cost		Gains		Months			Months			Value		Gains/(Losses)

Held-to-Maturity Securities:
U.S. Treasury securities	$	729,466	$	147,573	$	(1,729	)	$	-		$	875,310	$	145,844

Political subdivisions of States,
Territories and Possessions		998,984		50,366		-			-			1,049,350		50,366

Corporate and other bonds
Industrial and miscellaneous		3,141,358		90,358		-			(6,300	)		3,225,416		84,058

Total	$	4,869,808	$	288,297	$	(1,729	)	$	(6,300	)	$	5,150,076	$	280,268

Held-to-maturity U.S. Treasury securities are held in trust

Schedule of Held to Maturity Securities by contractual maturity

	December 31, 2018				December 31, 2017
	Amortized		Estimated		Amortized		Estimated
Remaining Time to Maturity	Cost		Fair Value		Cost		Fair Value

Less than one year	$	-	$	-	$	-	$	-
One to five years		2,996,685		3,036,531		2,546,459		2,601,898
Five to ten years		619,663		635,846		1,716,884		1,794,139
More than ten years		606,507		754,039		606,465		754,039
Total	$	4,222,855	$	4,426,416	$	4,869,808	$	5,150,076

Schedule of Investment Income

	Years ended
	December 31,
	2018		2017

Income:
Fixed-maturity securities	$	5,316,970	$	3,664,577
Equity securities		820,827		564,071
Cash and cash equivalents		219,238		56,075
Total		6,357,035		4,284,723
Expenses:
Investment expenses		170,787		152,137
Net investment income	$	6,186,248	$	4,132,586

Schedule of Securities with realized gains and losses on investments

	Years ended
	December 31,
	2018			2017
Realized (Losses) Gains

Fixed-maturity securities:
Gross realized gains	$	117,186		$	70,478
Gross realized losses (1)		(618,699	)		(309,247	)
		(501,513	)		(238,769	)

Equity securities:
Gross realized gains		992,012			636,880
Gross realized losses		(584,473	)		(263,798	)
		407,539			373,082

Net realized (losses) gains		(93,974	)		134,313

Other-than-temporary impairment losses:
Fixed-maturity securities		-			(50,000	)

Unrealized (Losses) Gains

Equity Securities:
Gross gains		-			-
Gross losses		(2,257,727	)		-
		(2,257,727	)		-

Other investments:
Gross gains		-			-
Gross losses		(144,156	)		-
		(144,156	)		-

Net unrealized losses		(2,401,883	)		-

Net (losses) gains on investments	$	(2,495,857	)	$	84,313

(1)

Schedule of Securities with Unrealized Losses

	December 31, 2018
	Less than 12 months							12 months or more							Total
	Estimated					No. of		Estimated					No. of		Estimated
	Fair		Unrealized			Positions		Fair		Unrealized			Positions		Fair		Unrealized
Category	Value		Losses			Held		Value		Losses			Held		Value		Losses

Fixed-Maturity Securities:
U.S. Treasury securities
and obligations of U.S.
government corporations
and agencies	$	4,948,530	$	(28,000	)		3	$	-	$	-			-	$	4,948,530	$	(28,000	)

Political subdivisions of
States, Territories and
Possessions		555,375		(12,327	)		1		1,436,242		(36,508	)		3		1,991,617		(48,835	)

Corporate and other
bonds industrial and
miscellaneous		81,004,459		(2,775,540	)		97		13,424,888		(676,605	)		24		94,429,347		(3,452,145	)

Residential mortgage and other
asset backed securities		7,002,713		(231,229	)		9		11,928,425		(331,012	)		19		18,931,138		(562,241	)

Total fixed-maturity
securities	$	93,511,077	$	(3,047,096	)		110	$	26,789,555	$	(1,044,125	)		46	$	120,300,632	$	(4,091,221	)

	December 31, 2017
	Less than 12 months							12 months or more							Total
	Estimated					No. of		Estimated					No. of		Estimated
	Fair		Unrealized			Positions		Fair		Unrealized			Positions		Fair		Unrealized
Category	Value		Losses			Held		Value		Losses			Held		Value		Losses

Fixed-Maturity Securities:
Political subdivisions of
States, Territories and
Possessions	$	1,549,839	$	(30,814	)		4	$	-	$	-			-	$	1,549,839	$	(30,814	)

Corporate and other
bonds industrial and
miscellaneous		15,036,462		(269,857	)		20		9,113,924		(340,516	)		17		24,150,386		(610,373	)

Residential mortgage and other
asset backed securities		6,956,371		(48,482	)		6		7,867,572		(189,022	)		15		14,823,943		(237,504	)

Total fixed-maturity
securities	$	23,542,672	$	(349,153	)		30	$	16,981,496	$	(529,538	)		32	$	40,524,168	$	(878,691	)

Equity Securities:
Preferred stocks	$	1,605,217	$	(20,313	)		5	$	1,776,675	$	(120,712	)		3	$	3,381,892	$	(141,025	)
Common stocks and
exchange traded mutual funds		1,446,375		(222,205	)		4		124,900		(14,530	)		1		1,571,275		(236,735	)

Total equity securities	$	3,051,592	$	(242,518	)		9	$	1,901,575	$	(135,242	)		4	$	4,953,167	$	(377,760	)

Total	$	26,594,264	$	(591,671	)		39	$	18,883,071	$	(664,780	)		36	$	45,477,335	$	(1,256,451	)

4. Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2018

Fair Value Measurements

Schedule of Fair Value Measurements

	December 31, 2018
	Level 1		Level 2		Level 3		Total

Fixed-maturity securities available-for-sale
U.S. Treasury securities
and obligations of U.S.
government corporations
and agencies	$	8,220,381	$	-	$	-	$	8,220,381

Political subdivisions of
States, Territories and
Possessions		-		6,341,608		-		6,341,608

Corporate and other
bonds industrial and
miscellaneous		112,076,270		3,674,023		-		115,750,293

Residential mortgage backed securities		-		21,465,234		-		21,465,234
Total fixed maturities		120,296,651		31,480,865		-		151,777,516
Equity securities		16,572,616		-		-		16,572,616
Total investments	$	136,869,267	$	31,480,865	$	-	$	168,350,132

	December 31, 2017
	Level 1		Level 2		Level 3		Total

Fixed-maturity securities available-for-sale
Political subdivisions of
States, Territories and
Possessions	$	-	$	11,315,443	$	-	$	11,315,443

Corporate and other
bonds industrial and
miscellaneous		83,597,300		4,544,165		-		88,141,465

Residential mortgage backed securities		-		20,531,348		-		20,531,348
Total fixed maturities		83,597,300		36,390,956		-		119,988,256
Equity securities		14,286,198		-		-		14,286,198
Total investments	$	97,883,498	$	36,390,956	$	-	$	134,274,454

Schedule of Hedge Fund Investments

Category	December 31, 2018		December 31, 2017

Other Investments:
Hedge fund	$	1,855,225	$	-
Total	$	1,855,225	$	-

Fair value hierarchy of long-term debt

	December 31, 2018
	Level 1		Level 2		Level 3		Total
Long-term debt

Senior Notes due 2022	$	-	$	28,521,734	$	-	$	28,521,734

	December 31, 2017
	Level 1		Level 2		Level 3		Total
Long-term debt

Senior Notes due 2022	$	-	$	28,493,251	$	-	$	28,943,251

5. Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2018

Fair Value Of Financial Instruments

Schedule of Fair Value of Financial Instruments

	December 31, 2018				December 31, 2017
	Carrying		Estimated		Carrying		Estimated
	Value		Fair Value		Value		Fair Value

Fixed-maturity securities-held-to maturity	$	4,222,855	$	4,426,416	$	4,869,808	$	5,150,076
Cash and cash equivalents	$	21,138,403	$	21,138,403	$	48,381,633	$	48,381,633
Investment subscription receivable	$	-	$	-	$	2,000,000	$	2,000,000
Premiums receivable, net	$	13,961,599	$	13,961,599	$	13,217,698	$	13,217,698
Reinsurance receivables, net	$	26,367,115	$	26,367,115	$	28,519,130	$	28,519,130
Real estate, net of accumulated depreciation	$	2,300,827	$	2,705,000	$	2,261,829	$	2,705,000
Reinsurance balances payable	$	1,933,376	$	1,933,376	$	2,563,966	$	2,563,966
Long-term debt, net	$	29,295,251	$	28,521,734	$	29,126,965	$	28,943,251

6. Intangibles (Tables)

12 Months Ended

Dec. 31, 2018

Intangibles

Schedule of components of intangible assets and their useful lives, accumulated amortization, and net carrying value

			December 31, 2018						December 31, 2017
	Useful		Gross				Net		Gross				Net
	Life		Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
	(in yrs)		Value		Amortization		Amount		Value		Amortization		Amount
Insurance license		-	$	500,000	$	-	$	500,000	$	500,000	$	-	$	500,000
Customer relationships		10		3,400,000		3,230,000		170,000		3,400,000		2,890,000		510,000
Other identifiable intangibles		7		950,000		950,000				950,000		950,000		-
Total			$	4,850,000	$	4,180,000	$	670,000	$	4,850,000	$	3,840,000	$	1,010,000

7. Reinsurance (Tables)

12 Months Ended

Dec. 31, 2018

Reinsurance Tables Abstract

Line of Business

	Treaty Year
	July 1, 2018			July 1, 2017			July 1, 2016
	to			to			to
Line of Busines	June 30, 2019			June 30, 2018			June 30, 2017

Personal Lines:
Homeowners, dwelling fire and canine legal liability
Quota share treaty:
Percent ceded		10	%		20	%		40	%
Risk retained	$	900,000		$	800,000		$	500,000
Losses per occurrence subject to quota share reinsurance coverage	$	1,000,000		$	1,000,000		$	833,333
Excess of loss coverage and facultative facility above quota share coverage (1)	$	9,000,000		$	9,000,000		$	3,666,667
	in excess of			in excess of				in excess of
	$	1,000,000		$	1,000,000		$	833,333
Total reinsurance coverage per occurrence	$	9,100,000		$	9,200,000		$	4,000,000
Losses per occurrence subject to reinsurance coverage	$	10,000,000		$	10,000,000		$	4,500,000
Expiration date	June 30, 2019			June 30, 2018				June 30, 2017

Personal Umbrella
Quota share treaty:
Percent ceded - first $1,000,000 of coverage		90	%		90	%		90	%
Percent ceded - excess of $1,000,000 dollars of coverage		100	%		100	%		100	%
Risk retained	$	100,000		$	100,000		$	100,000
Total reinsurance coverage per occurrence	$	4,900,000		$	4,900,000		$	4,900,000
Losses per occurrence subject to quota share reinsurance coverage	$	5,000,000		$	5,000,000		$	5,000,000
Expiration date	June 30, 2019			June 30, 2018				June 30, 2017

Commercial Lines:
General liability commercial policies
Quota share treaty	None			None				None
Risk retained	$	750,000		$	750,000		$	500,000
Excess of loss coverage above risk retained	$	3,750,000		$	3,750,000		$	4,000,000
		in excess of			in excess of			in excess of
	$	750,000		$	750,000		$	500,000
Total reinsurance coverage per occurrence	$	3,750,000		$	3,750,000		$	4,000,000
Losses per occurrence subject to reinsurance coverage	$	4,500,000		$	4,500,000		$	4,500,000

Commercial Umbrella
Quota share treaty:
Percent ceded - first $1,000,000 of coverage		90	%		90	%		90	%
Percent ceded - excess of $1,000,000 of coverage		100	%		100	%		100	%
Risk retained	$	100,000		$	100,000		$	100,000
Total reinsurance coverage per occurrence	$	4,900,000		$	4,900,000		$	4,900,000
Losses per occurrence subject to quota share reinsurance coverage	$	5,000,000		$	5,000,000		$	5,000,000
Expiration date	June 30, 2019			June 30, 2018				June 30, 2017

Catastrophe Reinsurance:
Initial loss subject to personal lines quota share treaty	$	5,000,000		$	5,000,000		$	5,000,000
Risk retained per catastrophe occurrence (2)	$	4,500,000		$	4,000,000		$	3,000,000
Catastrophe loss coverage in excess of quota share coverage (3) (4)	$	445,000,000		$	315,000,000		$	247,000,000
Reinstatement premium protection (5)		Yes			Yes			Yes

Single maximum risks under treaties per occurrence

	July 1, 2018 - June 30, 2019
Treaty	Extent of Loss	Risk Retained
Personal Lines (1)	Initial $1,000,000	$900,000
	$1,000,000 - $10,000,000	None(2)
	Over $10,000,000	100%

Personal Umbrella	Initial $1,000,000	$100,000
	$1,000,000 - $5,000,000	None
	Over $5,000,000	100%

Commercial Lines	Initial $750,000	$750,000
	$750,000 - $4,500,000	None(3)
	Over $4,500,000	100%

Commercial Umbrella	Initial $1,000,000	$100,000
	$1,000,000 - $5,000,000	None
	Over $5,000,000	100%

Catastrophe (4)	Initial $5,000,000	$4,500,000
	$5,000,000 - $450,000,000	None
	Over $450,000,000	100%

	July 1, 2017 - June 30, 2018		July 1, 2016 - June 30, 2017
Treaty	Range of Loss	Risk Retained	Range of Loss	Risk Retained
Personal Lines	Initial $1,000,000	$800,000	Initial $833,333	$500,000
	$1,000,000 - $10,000,000	None(2)	$833,333 - $4,500,000	None(3)
	Over $10,000,000	100%	Over $4,500,000	100%

Personal Umbrella	Initial $1,000,000	$100,000	Initial $1,000,000	$100,000
	$1,000,000 - $5,000,000	None	$1,000,000 - $5,000,000	None
	Over $5,000,000	100%	Over $5,000,000	100%

Commercial Lines	Initial $750,000	$750,000	Initial $500,000	$500,000
	$750,000 - $4,500,000	None(3)	$500,000 - $4,500,000	None(3)
	Over $4,500,000	100%	Over $4,500,000	100%

Commercial Umbrella	Initial $1,000,000	$100,000	Initial $1,000,000	$100,000
	$1,000,000 - $5,000,000	None	$1,000,000 - $5,000,000	None
	Over $5,000,000	100%	Over $5,000,000	100%

Catastrophe (4)	Initial $5,000,000	$4,000,000	Initial $5,000,000	$3,000,000
	$5,000,000 - $320,000,000	None	$5,000,000 - $252,000,000	None
	Over $320,000,000	100%	Over $252,000,000	100%

Schedule of approximate reinsurance recoverables

	Unpaid		Paid
($ in thousands)	Losses		Losses		Total		Security
December 31, 2018
Maiden Reinsurace Company	$	5,319	$	1,277	$	6,596	$	7,548	(1	)
Swiss Reinsurance America Corporation		4,499		1,251		5,750		-
Hanover Rueck SE		2,728		1,181		3,909		-
SCOR Reinsurance Company		528		89		617		-
Allied World Assurance Company		306		373		679		-
Others		2,291		282		2,573		58	(2	)
Total	$	15,671	$	4,453	$	20,124	$	7,606

December 31, 2017
Maiden Reinsurace Company	$	8,160	$	968	$	9,128	$	10,583	(1	)
Swiss Reinsurance America Corporation		4,299		600		4,899		-
Hanover Rueck SE		857		420		1,277		-
SCOR Reinsurance Company		851		209		1,060		-
Allied World Assurance Company		1,649		188		1,837		-
Others		932		148		1,080		205	(3	)
Total	$	16,748	$	2,533	$	19,281	$	10,788

Schedule of Ceding commissions earned

	Years ended
	December 31,
	2018			2017

Provisional ceding commissions earned	$	6,745,928		$	10,677,214
Contingent ceding commissions earned		(1,413,298	)		(744,081	)
	$	5,332,630		$	9,933,133

8. Deferred Policy Acquisition Costs and Deferred Ceding Commission Revenue (Tables)

12 Months Ended

Dec. 31, 2018

Deferred Policy Acquisition Costs And Deferred Ceding Commission Revenue

Schedule of acquisition costs incurred

	Years ended
	December 31,
	2018			2017

Net deferred policy acquisition costs, net of ceding
commission revenue, beginning of year	$	10,580,824		$	5,387,940

Cost incurred and deferred:
Commissions and brokerage		27,687,907			23,093,880
Other underwriting and policy acquisition costs		8,227,992			6,669,904
Ceding commission revenue		(5,166,193	)		(8,091,785	)
Net deferred policy acquisition costs		30,749,706			21,671,999
Return of deferred ceding commission revenue
due to reduction of quota share		(2,413,273	)		(3,648,859	)
Amortization		(23,696,197	)		(12,830,256	)
		4,640,236			5,192,884

Net deferred policy acquisition costs, net of ceding
commission revenue, end of year	$	15,221,060		$	10,580,824

Schedule of Ending balances for deferred acquisition costs and deferred ceding commission revenue

	December 31,
	2018			2017

Deferred policy acquisition costs	$	17,907,737		$	14,847,236
Deferred ceding commission revenue		(2,686,677	)		(4,266,412	)
Balance at end of period	$	15,221,060		$	10,580,824

9. Debt (Tables)

12 Months Ended

Dec. 31, 2018

Debt Tables Abstract

Long-term debt

	December 31,			December 31,
	2018			2017

5.50% Senior Unsecured Notes	$	30,000,000		$	30,000,000
Discount		(129,796	)		(162,209	)
Issuance costs		(574,953	)		(710,826	)
Long-term debt, net	$	29,295,251		$	29,126,965

10. Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2018

Property And Equipment

Schedule of components of property and equipment

			Accumulated
	Cost		Depreciation			Net

December 31, 2018
Building	$	2,231,967	$	(554,077	)	$	1,677,890
Land		622,937		-			622,937
Furniture office equipment		723,217		(586,010	)		137,207
Computer equipment and software		7,240,613		(3,621,718	)		3,618,895
Total	$	10,818,734	$	(4,761,805	)	$	6,056,929

December 31, 2017
Building	$	2,146,950	$	(460,819	)	$	1,686,131
Land		575,698		-			575,698
Furniture office equipment		707,524		(493,558	)		213,966
Computer equipment and software		4,657,174		(2,360,392	)		2,296,782
Total	$	8,087,346	$	(3,314,769	)	$	4,772,577

11. Property and Casualty Insurance Activity (Tables)

12 Months Ended

Dec. 31, 2018

Property And Casualty Insurance Activity

Schedule of Earned Premiums

	Written
	Direct			Assumed		Ceded			Net

Year ended December 31, 2018
Premiums written	$	146,716,468		$	1,004	$	(26,923,679	)	$	119,793,793
Change in unearned premiums		(13,388,535	)		4,067		(2,994,610	)		(16,379,078	)
Premiums earned	$	133,327,933		$	5,071	$	(29,918,289	)	$	103,414,715

Year ended December 31, 2017
Premiums written	$	121,575,178		$	22,847	$	(28,729,149	)	$	92,868,876
Change in unearned premiums		(10,662,744	)		9,456		(4,864,565	)		(15,517,853	)
Premiums earned	$	110,912,434		$	32,303	$	(33,593,714	)	$	77,351,023

Schedule of Loss and Loss Adjustment Expenses

	Gross		Reinsurance
	Liability		Receivables
December 31, 2018
Case-basis reserves	$	35,812,037	$	12,283,616
Loss adjustment expenses		9,102,862		1,433,170
IBNR reserves		11,282,207		1,954,461
Recoverable on unpaid losses				15,671,247
Recoverable on paid losses		-		4,453,298
Total loss and loss adjustment expenses	$	56,197,106		20,124,545
Unearned premiums				6,242,570
Total reinsurance receivables			$	26,367,115

December 31, 2017
Case-basis reserves	$	30,499,592	$	11,987,693
Loss adjustment expenses		8,635,199		1,990,506
IBNR reserves		9,664,831		2,770,709
Recoverable on unpaid losses				16,748,908
Recoverable on paid losses		-		2,533,042
Total loss and loss adjustment expenses	$	48,799,622		19,281,950
Unearned premiums				9,237,180
Total reinsurance receivables			$	28,519,130

Schedule of Ceding Commission Revenue

	Years ended
	December 31,
	2018			2017

Balance at beginning of period	$	48,799,622		$	41,736,719
Less reinsurance recoverables		(16,748,908	)		(15,776,880	)
Net balance, beginning of period		32,050,714			25,959,839

Incurred related to:
Current year		57,143,077			34,246,081
Prior years		1,152,128			(60,544	)
Total incurred		58,295,205			34,185,537

Paid related to:
Current year		34,025,387			18,194,860
Prior years		15,794,673			9,899,802
Total paid		49,820,060			28,094,662

Net balance at end of period		40,525,859			32,050,714
Add reinsurance recoverables		15,671,247			16,748,908
Balance at end of period	$	56,197,106		$	48,799,622

Incurred Claims and Allocated Claim Adjustment Expenses

All Lines of Business
*(in thousands, except reported claims data)*
											As of
	Incurred Loss and Allocated Loss Adjustment Expenses, Net of Reinsurance										December 31, 2018
	For the Years Ended December 31,										IBNR	Cumulative Number of Reported Claims by Accident Year
Accident Year	2009	2010	2011	2012	2013	2014	2015	2016	2017	2018	IBNR	Cumulative Number of Reported Claims by Accident Year
	(Unaudited 2009 - 2017)

2009	$4,403	$4,254	$4,287	$4,384	$4,511	$4,609	$4,616	$4,667	$4,690	$ 4,672	$ -	1,136
2010		5,598	5,707	6,429	6,623	6,912	6,853	6,838	6,840	6,787	-	1,617
2011			7,603	7,678	8,618	9,440	9,198	9,066	9,144	9,171	(3)	1,914
2012				9,539	9,344	10,278	10,382	10,582	10,790	10,791	(4)	4,702	(1)
2013					10,728	9,745	9,424	9,621	10,061	10,089	38	1,560
2014						14,193	14,260	14,218	14,564	15,023	238	2,131
2015							22,340	21,994	22,148	22,491	537	2,552
2016								26,062	24,941	24,789	1,096	2,862
2017									31,605	32,169	2,697	3,335
2018										54,455	9,079	3,935
									Total	$ 190,437
(1) Reported claims for accident year 2012 includes 3,406 claims from Superstorm Sandy.

Cumulative Paid Claims and Allocated Claim Adjustment Expenses

All Lines of Business
*(in thousands)*
	Cumulative Paid Loss and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,
Accident Year	2009	2010	2011	2012	2013	2014	2015	2016	2017	2018
	(Unaudited 2009 - 2017)

2009	$2,298	$3,068	$3,607	$3,920	$4,134	$4,362	$4,424	$4,468	$4,487	$ 4,659
2010		2,566	3,947	4,972	5,602	6,323	6,576	6,720	6,772	6,780
2011			3,740	5,117	6,228	7,170	8,139	8,540	8,702	8,727
2012				3,950	5,770	7,127	8,196	9,187	10,236	10,323
2013					3,405	5,303	6,633	7,591	8,407	9,056
2014						5,710	9,429	10,738	11,770	13,819
2015							12,295	16,181	18,266	19,984
2016								15,364	19,001	21,106
2017									16,704	24,820
2018										32,383
									Total	$ 151,657

Net liability for unpaid loss and allocated loss adjustment expenses for the accident years presented										$ 38,780
All outstanding liabilities before 2009, net of reinsurance										93
Liabilities for loss and allocted loss adjustment expenses, net of reinsurance										$ 38,873

Reconciliation of the net incurred and paid claims

	As of
*(in thousands)*	December 31, 2018
Liabilities for loss and loss adjustment expenses, net of reinsurance	$	38,873
Total reinsurance recoverable on unpaid losses		15,671
Unallocated loss adjustment expenses		1,653
Total gross liability for loss and LAE reserves	$	56,197

Supplementary unaudited information about average historical claims duration

Average Annual Percentage Payout of Incurred Loss and Allocated Loss Adjustment Expenses by Age, Net of Reinsurance (Unaudited)
Years	1	2	3	4	5	6	7	8	9	10

All Lines of Business	46.4%	18.8%	11.4%	8.6%	9.5%	5.8%	1.5%	0.7%	0.3%	3.7%

12. Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2018

Stockholders Equity

Schedule of Stock Options Activity

Stock Options	Number of Shares			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value

Outstanding at January 1, 2018		341,150		$	6.69		1.67	$	4,131,028

Granted		-		$	-		-	$	-
Exercised		(303,650	)	$	6.48		-	$	3,794,505
Forfeited		-		$	-		-	$	-

Outstanding at December 31, 2018		37,500		$	8.36		2.24	$	349,950

Vested and Exercisable at December 31, 2018		27,500		$	8.37		2.26	$	256,313

Restricted Stock Awards	Shares			Weighted Average Grant Date Fair Value per Share		Aggregate Fair Value

Balance at January 1, 2018		47,337		$	14.35	$	679,180

Granted		92,004		$	18.67	$	1,717,958
Vested		(15,752	)	$	14.07	$	(221,613	)
Forfeited		(3,090	)	$	15.00	$	(46,350	)

Balance at December 31, 2018		120,499		$	17.66	$	2,129,175

15. Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Taxes Tables Abstract

Schedule of provision for income taxes from continuing operations

Years ended December 31,	2018			2017

Current federal income tax expense	$	(74,001	)	$	4,317,686
Current state income tax (benefit) expense		(6,784	)		7,353
Deferred federal and state income tax benefit		(5,398	)		(1,809	)
Income tax (benefit) expense	$	(86,183	)	$	4,323,230

Schedule of a reconciliation of the federal statutory rate

Years ended December 31,	2018					2017
Computed expected tax expense	$	631,483		21.0	%	$	5,008,400		35.0	%
Change in enacted tax rates on net deferred tax liabilities		-		-			(405,218	)	(2.8	)
State taxes, net of Federal benefit		(377,884	)	(12.6	)		(101,858	)	(0.7	)
State valuation allowance		390,976		13.0			124,486		0.9
Benefit of lower tax brackets		-		-			(100,000	)	(0.7	)
Permanent differences
Dividends received deduction		(85,703	)	(2.9	)		(138,197	)	(1.0	)
Non-taxable investment income		(40,861	)	(1.4	)		(85,684	)	(0.6	)
Excess benefit from stock-based compensation		(569,459	)	(18.9	)		-		-
Stock-based compensation		(16,960	)	(0.5	)		(25,821	)	(0.2	)
Other permanent differences		42,496		1.4			46,962		0.3
Prior year tax matters		(61,415	)	(2.0	)		4,172		-
Other		1,144		-			(4,012	)	-
Income tax (benefit) expense, as reported	$	(86,183	)	(2.9	)%	$	4,323,230		30.2	%

Schedule of Deferrred Tax Assets and Liabilities

	December 31,			December 31,
	2018			2017

Deferred tax asset:
Net operating loss carryovers (1)	$	90,438		$	103,655
Claims reserve discount		343,905			300,005
Unearned premium		3,145,682			2,431,301
Deferred ceding commission revenue		564,202			895,947
Other		383,733			382,522
Total deferred tax assets		4,527,960			4,113,430

Deferred tax liability:
Investment in KICO (2)		759,543			759,543
Deferred acquisition costs		3,760,625			3,117,920
Intangibles		140,700			212,100
Depreciation and amortization		664,194			328,735
Net unrealized (losses) gains of securities - available-for-sale		(1,151,335	)		295,474
Total deferred tax liabilities		4,173,727			4,713,772

Net deferred income tax asset (liability)	$	354,233		$	(600,342	)

Schedule of net operating loss carryovers

	December 31,			December 31,
Type of NOL	2018			2017			Expiration
State only (A)	$	1,305,365		$	824,996		December 31, 2038
Valuation allowance		(1,217,027	)		(725,541	)
State only, net of valuation allowance		88,338			99,455
Amount subject to Annual Limitation, federal only (B)		2,100			4,200		December 31, 2019
Total deferred tax asset from net operating loss carryovers	$	90,438		$	103,655

Schedule of changes in net deferred income tax liability to the deferred income tax provision

Change in net deferred income tax assets	$	(954,575	)
Deferred tax benefit allocated to other comprehensive (loss) income		(949,177	)
Deferred income tax benefit	$	(5,398	)

17. Commitments and Contingencies (Tables) (USD $)

12 Months Ended

Dec. 31, 2018

Commitments And Contingencies Tables

Schedule of future minimum rental commitments

For the Year
Ending
December 31,		Total
	2019	$	169,861
	2020		175,806
	2021		181,959
	2022		188,382
	2023		194,919
	Thereafter		49,145
	Total	$	960,018

18. Earnings Per Common Share (Tables)

12 Months Ended

Dec. 31, 2018

Earnings per common share:

Reconciliation of the weighted average number of shares of Common Stock used in the calculation of basic and diluted earnings per common share

	Years ended
	December 31,
	2018		2017

Weighted average number of shares outstanding		10,686,813		10,388,440

Effect of dilutive securities, common share equivalents:
Stock options		19,823		188,983
Restricted stock awards		10,250		4,154

Weighted average number of shares outstanding,
used for computing diluted earnings per share		10,716,886		10,581,577

20. Quarterly Financial Data (Tables)

12 Months Ended

Dec. 31, 2018

Quarterly Financial Data

Schedule of Quarterly Financial Data

	2018
	March 31,			June 30,			September 30,		December 31,			Total

Net premiums earned	$	22,837,617		$	24,104,614		$	27,533,907	$	28,938,577		$	103,414,715
Ceding commission revenue		1,695,158			1,691,168			1,044,529		901,775			5,332,630
Net investment income		1,383,989			1,556,866			1,602,371		1,643,022			6,186,248
Net (losses) gains on investments		(523,127	)		(106,733	)		352,025		(2,218,022	)		(2,495,857	)
Total revenues		25,701,870			27,546,186			30,885,909		29,637,933			113,771,898
Loss and loss adjustment expenses		17,266,330			11,176,085			13,296,708		16,556,082			58,295,205
Commission expense and
other underwriting expenses		10,831,451			11,093,175			11,788,002		12,572,851			46,285,479
Net income (loss)		(2,717,934	)		2,757,297			3,933,730		(879,847	)		3,093,246
Basic earnings (loss) per share	$	(0.28	)	$	0.26		$	0.37	$	(0.08	)	$	0.29
Diluted earnings (loss) per share	$	(0.28	)	$	0.25		$	0.36	$	(0.08	)	$	0.29

	2017
	March 31,			June 30,		September 30,		December 31,			Total

Net premiums earned	$	16,369,748		$	16,953,727	$	21,514,408	$	22,513,140		$	77,351,023
Ceding commission revenue		3,184,452			3,305,938		1,717,610		1,725,133			9,933,133
Net investment income		857,800			1,026,004		1,033,307		1,215,475			4,132,586
Net realized gain (loss) on investments		(54,506	)		130,423		20,998		(12,602	)		84,313
Total revenues		20,647,194			21,724,251		24,614,653		25,783,212			92,769,310
Loss and loss adjustment expenses		8,292,996			7,454,922		7,073,323		11,364,296			34,185,537
Commission expense and
other underwriting expenses		9,101,395			9,301,182		9,975,938		10,919,353			39,297,868
Net income		1,470,580			2,510,392		4,073,921		1,931,592			9,986,485
Basic earnings per share	$	0.15		$	0.24	$	0.38	$	0.18		$	0.96
Diluted earnings per share	$	0.15		$	0.23	$	0.38	$	0.18		$	0.94

2. Accounting Policies and Basis of Presentation (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Accounting Policies And Basis Of Presentation
Collateralized bank repurchase agreement (1)	$ 568,123	$ 10,249,985
Money market fund	15,012,559	35,874,700
Total	$ 15,580,682	$ 46,124,685

2. Accounting Policies and Basis of Presentation (Details 1)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Total premiums earned subject to concentration	92.30%	99.70%
Premiums earned not subject to concentration	7.70%	0.30%
Total premiums earned	100.00%	100.00%
Personal Lines [Member]
Total premiums earned subject to concentration	80.70%	77.20%
Commercial Lines [Member]
Total premiums earned subject to concentration	11.60%	12.20%
Commercial Auto [Member]
Total premiums earned subject to concentration	0.00%	10.30%

2. Accounting Policies and Basis of Presentation (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Accounting Policies And Basis Of Presentation Details Narrative Abstract
Allowance for uncollectible reinsurance	$ 0	$ 0
Due and accrued investment income	1,721,000	1,136,000
Allowance for doubtful accounts	255,000	291,000
Uncollectible premiums receivable balances written off	252,000	138,000
Advertising costs	$ 173,000	$ 202,000

3. Investments (Details) - USD ($)	12 Months Ended
3. Investments (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Cost or Amortized Cost		$ 132,883,947
Gross Unrealized Gains	$ 0	0
Gross Unrealized Losses-Less than 12 Months		(591,671)
Gross Unrealized Loss-More than 12 Months		(664,780)
Fair Value		134,274,454
Net Unrealized Gains/(Losses)		1,390,507
US Treasury Securities
Cost or Amortized Cost	8,222,050
Gross Unrealized Gains	26,331
Gross Unrealized Losses-Less than 12 Months	(28,000)
Gross Unrealized Loss-More than 12 Months	0
Fair Value	8,220,381
Net Unrealized Gains/(Losses)	(1,669)
Fixed Maturity Securities Political Subdivisions Of States Territories And Possessions
Cost or Amortized Cost	6,339,540	11,096,122
Gross Unrealized Gains	50,903	250,135
Gross Unrealized Losses-Less than 12 Months	(12,327)	(30,814)
Gross Unrealized Loss-More than 12 Months	(36,508)	0
Fair Value	6,341,608	11,315,443
Net Unrealized Gains/(Losses)	2,068	219,321
Fixed Maturity Securities Corporate And Other Bonds Industrial And Miscellaneous
Cost or Amortized Cost	119,078,698	87,562,631
Gross Unrealized Gains	123,740	1,189,207
Gross Unrealized Losses-Less than 12 Months	(2,775,540)	(269,857)
Gross Unrealized Loss-More than 12 Months	(676,605)	(340,516)
Fair Value	115,750,293	88,141,465
Net Unrealized Gains/(Losses)	(3,328,405)	578,834
Fixed Maturity Securities Residential mortgage backed securities
Cost or Amortized Cost	21,790,973	20,463,353
Gross Unrealized Gains	236,502	305,499
Gross Unrealized Losses-Less than 12 Months	(231,229)	(48,482)
Gross Unrealized Loss-More than 12 Months	(331,012)	(189,022)
Fair Value	21,465,234	20,531,348
Net Unrealized Gains/(Losses)	(325,739)	67,995
Fixed Maturity Securities Total Fixed Maturity Securities
Cost or Amortized Cost	155,431,261	119,122,106
Gross Unrealized Gains	437,476	1,744,841
Gross Unrealized Losses-Less than 12 Months	(3,047,096)	(349,153)
Gross Unrealized Loss-More than 12 Months	(1,044,125)	(529,538)
Fair Value	151,777,516	119,988,256
Net Unrealized Gains/(Losses)	(3,653,745)	866,150
Equity Securities Preferred Stocks
Cost or Amortized Cost	6,694,754	7,081,099
Gross Unrealized Gains	0	60,867
Gross Unrealized Losses	(541,798)	(141,025)
Fair Value	6,152,956	7,000,941
Equity Securities Common Stocks
Cost or Amortized Cost	11,611,232	6,680,742
Gross Unrealized Gains	99,817	841,250
Gross Unrealized Losses	(1,291,389)	(236,735)
Fair Value	10,419,660	7,285,257
Equity Securities Total Equity Securities
Cost or Amortized Cost	18,305,986	13,761,841
Gross Unrealized Gains	99,817	902,117
Gross Unrealized Losses	(1,833,187)	(377,760)
Fair Value	$ 16,572,616	$ 14,286,198

3. Investments (Details 1) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Amortized Cost	$ 155,431,261	$ 119,122,106
Fair Value	151,777,516	119,988,256
Less Than One Year
Amortized Cost	6,742,519	2,585,479
Fair Value	6,738,014	2,595,938
One To Five Years
Amortized Cost	47,038,838	31,716,345
Fair Value	46,640,012	32,065,197
Five To Ten Years
Amortized Cost	76,884,505	62,702,945
Fair Value	74,290,076	63,129,543
More Than 10 Years
Amortized Cost	2,974,426	1,653,984
Fair Value	2,644,180	1,666,230
Residential mortgage backed securities
Amortized Cost	21,790,973	20,463,353
Fair Value	$ 21,465,234	$ 20,531,348

3. Investments (Details 2) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Cost or Amortized Cost	$ 4,222,855	$ 4,869,808
Gross Unrealized Gains	219,855	288,297
Gross Unrealized Losses-Less than 12 Months	(5,389)	(1,729)
Gross Unrealized Loss-More than 12 Months	(10,905)	(6,300)
Fair Value	4,426,416	5,150,076
Net Unrealized Gains/(Losses)	203,561	280,268
US Treasury Securities
Cost or Amortized Cost	729,507	729,466
Gross Unrealized Gains	147,532	147,573
Gross Unrealized Losses-Less than 12 Months	(3,964)	(1,729)
Gross Unrealized Loss-More than 12 Months	0	0
Fair Value	873,075	875,310
Net Unrealized Gains/(Losses)	143,568	145,844
Fixed Maturity Securities Political Subdivisions Of States Territories And Possessions
Cost or Amortized Cost	998,803	998,984
Gross Unrealized Gains	33,862	50,366
Gross Unrealized Losses-Less than 12 Months	0	0
Gross Unrealized Loss-More than 12 Months	0	0
Fair Value	1,032,665	1,049,350
Net Unrealized Gains/(Losses)	33,862	50,366
Fixed Maturity Securities Corporate And Other Bonds Industrial And Miscellaneous
Cost or Amortized Cost	2,494,545	3,141,358
Gross Unrealized Gains	38,461	90,358
Gross Unrealized Losses-Less than 12 Months	(1,425)	0
Gross Unrealized Loss-More than 12 Months	(10,905)	(6,300)
Fair Value	2,520,676	3,225,416
Net Unrealized Gains/(Losses)	$ 26,131	$ 84,058

3. Investments (Details 3) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Amortized Cost	$ 4,222,855	$ 4,869,808
Fair Value	4,426,416	5,150,076
Less Than One Year
Amortized Cost	0	0
Fair Value	0	0
One To Five Years
Amortized Cost	2,996,685	2,546,459
Fair Value	3,036,531	2,601,898
Five To Ten Years
Amortized Cost	619,663	1,716,884
Fair Value	635,846	1,794,139
More Than 10 Years
Amortized Cost	606,507	606,465
Fair Value	$ 754,039	$ 754,039

3. Investments (Details 4) - USD ($)	12 Months Ended
3. Investments (Details 4) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Income:
Fixed-maturity securities	$ 5,316,970	$ 3,664,577
Equity securities	820,827	564,071
Cash and cash equivalents	219,238	56,075
Total	6,357,035	4,284,723
Expenses:
Investment expenses	170,787	152,137
Net investment income	$ 6,186,248	$ 4,132,586

3. Investments (Details 5) - USD ($)	3 Months Ended								12 Months Ended
3. Investments (Details 5) - USD ($)	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Fixed-maturity securities:
Gross realized gains									$ 117,186	$ 70,478
Gross realized losses									(618,699)	(309,247)
Total fixed-maturity securities, realized									(501,513)	(238,769)
Gross unrealized gains									0	0
Gross unrealized losses									(2,257,727)	0
Total fixed-maturity securities, unrealized									(2,257,727)	0
Equity securities:
Gross realized gains									992,012	636,880
Gross realized losses									(584,473)	(263,798)
Total equity securities, realized									407,539	373,082
Net realized (losses) gains									(93,974)	134,313
Gross unrealized gains									0	0
Gross unrealized losses									(144,156)	0
Total equity securities, unrealized									(144,156)	0
Net unrealized losses									(2,401,883)	0
Net (losses) gains on investments	$ (2,218,022)	$ 352,025	$ (106,733)	$ (523,127)	$ (12,602)	$ 20,998	$ 130,423	$ (54,506)	(2,495,857)	84,313
Other-than-temporary impairment losses:
Fixed-maturity securities									$ 0	$ (50,000)

3. Investments (Details 6) - USD ($)	12 Months Ended
3. Investments (Details 6) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Fair Value-Less than 12 months		$ 26,594,264
Unrealized Losses-Less than 12 Months		(591,671)
No. of Positions Held-Less than 12 Months		39
Fair Value-12 months or more		18,883,071
Unrealized Losses-12 months or more		(664,780)
No. of Positions Held-12 months or more		36
Aggregate Fair Value-Total		45,477,335
Unrealized Losses-Total		(1,256,451)
US Treasury Securities
Fair Value-Less than 12 months	$ 4,948,530
Unrealized Losses-Less than 12 Months	(28,000)
No. of Positions Held-Less than 12 Months	3
Fair Value-12 months or more	0
Unrealized Losses-12 months or more	0
No. of Positions Held-12 months or more	0
Aggregate Fair Value-Total	4,948,530
Unrealized Losses-Total	(28,000)
Fixed Maturity Securities Political Subdivisions Of States Territories And Possessions
Fair Value-Less than 12 months	555,375	1,549,839
Unrealized Losses-Less than 12 Months	(12,327)	(30,814)
No. of Positions Held-Less than 12 Months	1	4
Fair Value-12 months or more	1,436,242	0
Unrealized Losses-12 months or more	(36,508)	0
No. of Positions Held-12 months or more	3	0
Aggregate Fair Value-Total	1,991,617	1,549,839
Unrealized Losses-Total	(48,835)	(30,814)
Fixed Maturity Securities Corporate And Other Bonds Industrial And Miscellaneous
Fair Value-Less than 12 months	81,004,459	15,036,462
Unrealized Losses-Less than 12 Months	(2,775,540)	(269,857)
No. of Positions Held-Less than 12 Months	97	20
Fair Value-12 months or more	13,424,888	9,113,924
Unrealized Losses-12 months or more	(676,605)	(340,516)
No. of Positions Held-12 months or more	24	17
Aggregate Fair Value-Total	94,429,347	24,150,386
Unrealized Losses-Total	(3,452,145)	(610,373)
Fixed Maturity Securities Residential mortgage backed securities
Fair Value-Less than 12 months	7,002,713	6,956,371
Unrealized Losses-Less than 12 Months	(231,229)	(48,482)
No. of Positions Held-Less than 12 Months	9	6
Fair Value-12 months or more	11,928,425	7,867,572
Unrealized Losses-12 months or more	(331,012)	(189,022)
No. of Positions Held-12 months or more	19	15
Aggregate Fair Value-Total	18,931,138	14,823,943
Unrealized Losses-Total	(562,241)	(237,504)
Fixed Maturity Securities Total Fixed Maturity Securities
Fair Value-Less than 12 months	93,511,077	23,542,672
Unrealized Losses-Less than 12 Months	(3,047,096)	(349,153)
No. of Positions Held-Less than 12 Months	110	30
Fair Value-12 months or more	26,789,555	16,981,496
Unrealized Losses-12 months or more	(1,044,125)	(529,538)
No. of Positions Held-12 months or more	46	32
Aggregate Fair Value-Total	120,300,632	40,524,168
Unrealized Losses-Total	$ (4,091,221)	(878,691)
Equity Securities Preferred Stocks
Fair Value-Less than 12 months		1,605,217
Unrealized Losses-Less than 12 Months		(20,313)
No. of Positions Held-Less than 12 Months		5
Fair Value-12 months or more		1,776,675
Unrealized Losses-12 months or more		(120,712)
No. of Positions Held-12 months or more		3
Aggregate Fair Value-Total		3,381,892
Unrealized Losses-Total		(141,025)
Equity Securities Common Stocks
Fair Value-Less than 12 months		1,446,375
Unrealized Losses-Less than 12 Months		(222,205)
No. of Positions Held-Less than 12 Months		4
Fair Value-12 months or more		124,900
Unrealized Losses-12 months or more		(14,530)
No. of Positions Held-12 months or more		1
Aggregate Fair Value-Total		1,571,275
Unrealized Losses-Total		(236,735)
Equity Securities Total Equity Securities
Fair Value-Less than 12 months		3,051,592
Unrealized Losses-Less than 12 Months		(242,518)
No. of Positions Held-Less than 12 Months		9
Fair Value-12 months or more		1,901,575
Unrealized Losses-12 months or more		(135,242)
No. of Positions Held-12 months or more		4
Aggregate Fair Value-Total		4,953,167
Unrealized Losses-Total		$ (377,760)

3. Investments (Details Narrative) - USD ($)	12 Months Ended
3. Investments (Details Narrative) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Investments Details Narrative Abstract
Proceeds from the sale and maturity of fixed-maturity securities, held to maturity	$ 624,963	$ 247,500
Proceeds from the sale and maturity of fixed-maturity securities, available for sale	21,381,668	11,132,000
Proceeds from the sale of equity securities	$ 9,246,840	$ 3,862,127

4. Fair Value Measurements (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
U.S. Treasury securities and obligations of U.S. government corporations and agencies	$ 8,220,381
Political subdivisions of States, Territories and Possessions	6,341,608	11,315,443
Corporate and other bonds industrial and miscellaneous	115,750,293	88,141,465
Residential mortgage backed securities	21,465,234	20,531,348
Total fixed maturities	151,777,516	119,988,256
Equity investments	16,572,616	14,286,198
Total investments	168,350,132	134,274,454
Level 1
U.S. Treasury securities and obligations of U.S. government corporations and agencies	8,220,381
Political subdivisions of States, Territories and Possessions	0	0
Corporate and other bonds industrial and miscellaneous	112,076,270	83,597,300
Residential mortgage backed securities	0	0
Total fixed maturities	120,296,651	83,597,300
Equity investments	16,572,616	14,286,198
Total investments	136,869,267	97,883,498
Level 2
U.S. Treasury securities and obligations of U.S. government corporations and agencies	0
Political subdivisions of States, Territories and Possessions	6,341,608	11,315,443
Corporate and other bonds industrial and miscellaneous	3,674,023	4,544,165
Residential mortgage backed securities	21,465,234	20,531,348
Total fixed maturities	31,480,865	36,390,956
Equity investments	0	0
Total investments	31,480,865	36,390,956
Level 3
U.S. Treasury securities and obligations of U.S. government corporations and agencies	0
Political subdivisions of States, Territories and Possessions	0	0
Corporate and other bonds industrial and miscellaneous	0	0
Residential mortgage backed securities	0	0
Total fixed maturities	0	0
Equity investments	0	0
Total investments	$ 0	$ 0

4. Fair Value Measurements (Details 1) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Fair Value Measurements Details 1Abstract
Hedge fund	$ 1,855,225	$ 0
Total other investments	$ 1,855,225	$ 0

4. Fair Value Measurements (Details 2) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Senior Notes due 2022	$ 28,521,734	$ 28,943,251
Fair Value Inputs Level 1 [Member]
Senior Notes due 2022	0	0
Fair Value Inputs Level 2 [Member]
Senior Notes due 2022	28,521,734	28,943,251
Fair Value Inputs Level 3 [Member]
Senior Notes due 2022	$ 0	$ 0

5. Fair Value of Financial Instruments (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Investment subscription receivable	$ 0	$ 2,000,000
Reinsurance receivables	26,367,115	28,519,130
Reinsurance balances payable	1,933,376	2,563,966
Long-term debt, net	29,295,251	29,126,965
Carrying Value
Fixed-maturity investments held to maturity	4,222,855	4,869,808
Cash and cash equivalents	21,138,403	48,381,633
Investment subscription receivable	0	2,000,000
Premiums receivable, net	13,961,599	13,217,698
Reinsurance receivables	26,367,115	28,519,130
Real estate net of accumulated depreciation	2,300,827	2,261,829
Reinsurance balances payable	1,933,376	2,563,966
Long-term debt, net	29,295,251	29,126,965
Fair Value
Fixed-maturity investments held to maturity	4,426,416	5,150,076
Cash and cash equivalents	21,138,403	48,381,633
Investment subscription receivable	0	2,000,000
Premiums receivable, net	13,961,599	13,217,698
Reinsurance receivables	26,367,115	28,519,130
Real estate net of accumulated depreciation	2,705,000	2,705,000
Reinsurance balances payable	1,933,376	2,563,966
Long-term debt, net	$ 28,521,734	$ 28,943,251

6. Intangibles (Details) - USD ($)	12 Months Ended
6. Intangibles (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Gross Carrying Value	$ 4,850,000	$ 4,850,000
Accumulated Amortization	4,180,000	3,840,000
Net Carrying Amount	670,000	1,010,000
Insurance license [Member]
Gross Carrying Value	500,000	500,000
Accumulated Amortization	0	0
Net Carrying Amount	$ 500,000	$ 500,000
Useful Life (in yrs)	0 years	0 years
Customer relationships [Member]
Gross Carrying Value	$ 3,400,000	$ 3,400,000
Accumulated Amortization	3,230,000	2,890,000
Net Carrying Amount	$ 170,000	$ 510,000
Useful Life (in yrs)	10 years	10 years
Other identifiable intangibles [Member]
Gross Carrying Value	$ 950,000	$ 950,000
Accumulated Amortization	950,000	950,000
Net Carrying Amount	$ 0	$ 0
Useful Life (in yrs)	7 years	7 years

6. Intangibles (Details Narrative) - USD ($)	12 Months Ended
6. Intangibles (Details Narrative) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Intangibles Details Narrative Abstract
Amortization expense, related to intangibles	$ 340,000	$ 340,000

7. Reinsurance (Details) - USD ($)	12 Months Ended
7. Reinsurance (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Personal Lines [Member]
Quota share treaty:
Percent ceded	10.00%	20.00%	40.00%
Risk retained	$ 900,000	$ 800,000	$ 500,000
Losses per occurrence subject to quota share reinsurance coverage	1,000,000	1,000,000	833,333
Excess of loss coverage above quota share coverage	9,000,000	9,000,000	3,666,667
Total	1,000,000	1,000,000	833,333
Total reinsurance coverage per occurrence	9,100,000	9,200,000	4,000,000
Losses per occurrence subject to reinsurance coverage	$ 10,000,000	$ 10,000,000	$ 4,500,000
Expiration date	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2017
Personal Umbrella [Member]
Quota share treaty:
Percent ceded - first million dollars of coverage	90.00%	90.00%	90.00%
Percent ceded - excess of one million dollars of coverage	100.00%	100.00%	100.00%
Risk retained	$ 100,000	$ 100,000	$ 100,000
Total reinsurance coverage per occurrence	4,900,000	4,900,000	4,900,000
Losses per occurrence subject to reinsurance coverage	$ 5,000,000	$ 5,000,000	$ 5,000,000
Expiration date	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2017
Commercial Lines [Member]
Quota share treaty:
Percent ceded	0.00%	0.00%	0.00%
Risk retained	$ 750,000	$ 750,000	$ 500,000
Losses per occurrence subject to quota share reinsurance coverage	0	0	0
Excess of loss coverage above quota share coverage	3,750,000	3,750,000	4,000,000
Total	750,000	750,000	500,000
Total reinsurance coverage per occurrence	3,750,000	3,750,000	4,000,000
Losses per occurrence subject to reinsurance coverage	$ 4,500,000	$ 4,500,000	$ 4,500,000
Commercial Umbrella [Member]
Quota share treaty:
Percent ceded - first million dollars of coverage	90.00%	90.00%	90.00%
Percent ceded - excess of one million dollars of coverage	100.00%	100.00%	100.00%
Risk retained	$ 100,000	$ 100,000	$ 100,000
Total reinsurance coverage per occurrence	4,900,000	4,900,000	4,900,000
Losses per occurrence subject to reinsurance coverage	$ 5,000,000	$ 5,000,000	$ 5,000,000
Expiration date	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2017
Catastrophe [Member]
Quota share treaty:
Initial loss subject to personal lines quota share treaty	$ 5,000,000	$ 5,000,000	$ 5,000,000
Risk retained per catastrophe occurrence (1)	4,500,000	4,000,000	3,000,000
Catastrophe loss coverage in excess of quota share coverage (2) (3)	$ 445,000,000	$ 315,000,000	$ 247,000,000
Reinstatement premium protection	Yes	Yes	Yes

7. Reinsurance (Details 1)	12 Months Ended
7. Reinsurance (Details 1)	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2017
Catastrophe [Member] \| Initial 5,000,000 [Member]
Risk Retained			$3,000,000
Catastrophe [Member] \| 5,000,000 - 252,000,000 [Member]
Risk Retained			None
Catastrophe [Member] \| Over 252,000,000 [Member]
Risk Retained			100%
Catastrophe [Member] \| Initial $5,000,000
Risk Retained		$4,000,000
Catastrophe [Member] \| 5,000,000 - 320,000,000 [Member]
Risk Retained		None
Catastrophe [Member] \| Over 320,000,000 [Member]
Risk Retained		100%
Catastrophe [Member] \| Initial $5,000,000
Risk Retained	$4,500,000
Catastrophe [Member] \| 5,000,000 - 450,000,000
Risk Retained	None
Catastrophe [Member] \| Over $450,000,000 [Member]
Risk Retained	100%
Commercial Umbrella [Member] \| Initial 1,000,000 [Member]
Risk Retained			$100,000
Commercial Umbrella [Member] \| 1,000,000 - 5,000,000 [Member]
Risk Retained			None
Commercial Umbrella [Member] \| Over $5,000,000 [Member]
Risk Retained			100%
Commercial Umbrella [Member] \| Initial $1,000,000
Risk Retained	$100,000	$100,000
Commercial Umbrella [Member] \| $1,000,000 - $5,000,000
Risk Retained	None	None
Commercial Umbrella [Member] \| Over $5,000,000
Risk Retained	100%	100%
Commercial Lines [Member] \| Initial $500,000 [Member]
Risk Retained			$500,000
Commercial Lines [Member] \| $500,000 - $4,500,000 [Member]
Risk Retained			None(3)
Commercial Lines [Member] \| Over 4,500,000 [Member]
Risk Retained			100%
Commercial Lines [Member] \| Initial 750,000 [Member]
Risk Retained	$750,000	$750,000
Commercial Lines [Member] \| 750,000 - 4,500,000 [Member]
Risk Retained	None(3)	None(3)
Commercial Lines [Member] \| Over $4,500,000
Risk Retained		100%
Commercial Lines [Member] \| Over $4,500,000
Risk Retained	100%
Personal Umbrella [Member] \| Initial 1,000,000 [Member]
Risk Retained			$100,000
Personal Umbrella [Member] \| 1,000,000 - 5,000,000 [Member]
Risk Retained		None	None
Personal Umbrella [Member] \| Over $5,000,000 [Member]
Risk Retained	100%		100%
Personal Umbrella [Member] \| Initial $1,000,000
Risk Retained		$100,000
Personal Umbrella [Member] \| Over 5,000,000 [Member]
Risk Retained		100%
Personal Umbrella [Member] \| Initial $1,000,000
Risk Retained	$100,000
Personal Umbrella [Member] \| $1,000,000 - $5,000,000
Risk Retained	None
Personal Lines [Member] \| Initial 833,333 [Member]
Risk Retained			$500,000
Personal Lines [Member] \| $833,333 - $4,500,000 [Member]
Risk Retained			None(3)
Personal Lines [Member] \| Over $4,500,000 [Member]
Risk Retained			100%
Personal Lines [Member] \| Initial $1,000,000
Risk Retained		$800,000
Personal Lines [Member] \| 1,000,000 - 10,000,000 [Member]
Risk Retained	None(2)	None(2)
Personal Lines [Member] \| Over 10,000,000 [Member]
Risk Retained	100%	100%
Personal Lines [Member] \| Initial 1,000,000 [Member]
Risk Retained	$900,000

7. Reinsurance (Details 2) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Unpaid Losses	$ 15,671	$ 16,748
Paid Losses	4,453	2,533
Total	20,124	19,281
Security	7,606	10,788
Maiden Reinsurance Company [Member]
Unpaid Losses	5,319	8,160
Paid Losses	1,277	968
Total	6,596	9,128
Security	7,548	10,583
Swiss Reinsurance America Corporation [Member]
Unpaid Losses	4,499	4,299
Paid Losses	1,251	600
Total	5,750	4,899
Security	0	0
Hanover Rueck SE [Member]
Unpaid Losses	2,728	857
Paid Losses	1,181	420
Total	3,909	1,277
Security	0	0
SCOR Reinsurance Company [Member]
Unpaid Losses	528	851
Paid Losses	89	209
Total	617	1,060
Security	0	0
Allied World Assurance Company [Member]
Unpaid Losses	306	1,649
Paid Losses	373	188
Total	679	1,837
Security	0	0
Others [Member]
Unpaid Losses	2,291	932
Paid Losses	282	148
Total	2,573	1,080
Security	$ 58	$ 205

7. Reinsurance (Details 3) - USD ($)	3 Months Ended								12 Months Ended
7. Reinsurance (Details 3) - USD ($)	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Reinsurance Details 2Abstract
Provisional ceding commissions earned									$ 6,745,928	$ 10,677,214
Contingent ceding commissions earned									(1,413,298)	(744,081)
Ceding commission revenue	$ 901,775	$ 1,044,529	$ 1,691,168	$ 1,695,158	$ 1,725,133	$ 1,717,610	$ 3,305,938	$ 3,184,452	$ 5,332,630	$ 9,933,133

7. Reinsurance (Details Narrative) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Reinsurance Details Narrative Abstract
Reinsurance receivables	$ 6,243,000	$ 9,237,000
Reinsurance balances payable	$ 1,933,376	$ 2,563,966

8. Deferred Policy Acquisition Costs and Deferred Ceding Commission Revenue (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Deferred Acquisition Costs And Deferred Ceding Commission Revenue Details
Net deferred policy acquisition costs, net of ceding commission revenue, beginning of year	$ 10,580,824	$ 5,387,940
Cost incurred and deferred:
Commission and brokerage	27,687,907	23,093,880
Other underwriting and policy acquisition costs	8,227,992	6,669,904
Ceding commission revenue	(5,166,193)	(8,091,785)
Net deferred policy acquisition costs	30,749,706	21,671,999
Return of deferred ceding commission revenue due to reduction of quota share	(2,413,273)	(3,648,859)
Amortization	(23,696,197)	(12,830,256)
Deferred acquisition costs	4,640,236	5,192,884
Net deferred policy acquisition costs, net of ceding commission revenue, end of year	$ 15,221,060	$ 10,580,824

8. Deferred Policy Acquisition Costs and Deferred Ceding Commission Revenue (Details 1) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Deferred Acquisition Costs And Deferred Ceding Commission Revenue Details 1Abstract
Deferred policy acquisition costs	$ 17,907,737	$ 14,847,236
Deferred ceding commission revenue	(2,686,677)	(4,266,412)
Balance at end of period	$ 15,221,060	$ 10,580,824

9. Debt (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Long-term debt, net	$ 29,295,251	$ 29,126,965
Issuance costs
Long-term debt, net	(574,953)	(710,826)
5.50% Senior Unsecured Notes
Long-term debt, net	30,000,000	30,000,000
Discount
Long-term debt, net	$ (129,796)	$ (162,209)

10. Property and Equipment (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Cost	$ 10,818,734	$ 8,107,644
Accumulated Depreciation	(4,761,805)	(3,314,769)
Net	6,056,929	4,772,577
Building
Cost	2,231,967	2,146,950
Accumulated Depreciation	(554,077)	(460,819)
Net	1,677,890	1,686,131
Land
Cost	622,937	575,698
Accumulated Depreciation	0	0
Net	622,937	575,698
Furniture office equipment
Cost	723,217	707,524
Accumulated Depreciation	(586,010)	(493,558)
Net	137,207	213,966
Computer equipment and software
Cost	7,240,613	4,657,174
Accumulated Depreciation	(3,621,718)	(2,360,392)
Net	$ 3,618,895	$ 2,296,782

10. Property and Equipment (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Property And Equipment Details Textual Abstract
Depreciation expense	$ 1,447,150	$ 1,062,928

11. Property and Casualty Insurance Activity (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Premiums Written
Direct	$ 146,716,468	$ 121,575,178
Assumed	1,004	22,847
Ceded	(26,923,679)	(28,729,149)
Net	119,793,793	92,868,876
Changes In Unearned Premiums
Direct	(13,388,535)	(10,662,744)
Assumed	4,067	9,456
Ceded	(2,994,610)	(4,864,565)
Net	(16,379,078)	(15,517,853)
Premiums Earned
Direct	133,327,933	110,912,434
Assumed	5,071	32,303
Ceded	(29,918,289)	(33,593,714)
Net	$ 103,414,715	$ 77,351,023

11. Property and Casualty Insurance Activity (Details 1) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Unearned premiums	$ 79,032,131	$ 65,647,663
Gross Liability
Case-basis reserves	35,812,037	30,499,592
Loss adjustment expenses	9,102,862	8,635,199
IBNR reserves	11,282,207	9,664,831
Recoverable on paid losses	0	0
Total loss and loss adjustment expenses	56,197,106	48,799,622
Reinsurance Receivables
Case-basis reserves	12,283,616	11,987,693
Loss adjustment expenses	1,433,170	1,990,506
IBNR reserves	1,954,461	2,770,709
Recoverable on unpaid losses	15,671,247	16,748,908
Recoverable on paid losses	4,453,298	2,533,042
Total loss and loss adjustment expenses	20,124,545	19,281,950
Unearned premiums	6,242,570	9,237,180
Total reinsurance receivables	$ 26,367,115	$ 28,519,130

11. Property and Casualty Insurance Activity (Details 2) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Property And Casualty Insurance Activity Details 2Abstract
Balance at beginning of period	$ 48,799,622	$ 41,736,719
Less reinsurance recoverables	(16,748,908)	(15,776,880)
Net balance, beginning of period	32,050,714	25,959,839
Incurred related to:
Current year	57,143,077	34,246,081
Prior years	1,152,128	(60,544)
Total incurred	58,295,205	34,185,537
Paid related to:
Current year	34,025,387	18,194,860
Prior years	15,794,673	9,899,802
Total paid	49,820,060	28,094,662
Net balance at end of period	40,525,859	32,050,714
Add reinsurance recoverables	15,671,247	16,748,908
Balance at end of period	$ 56,197,106	$ 48,799,622

11. Property and Casualty Insurance Activity (Details 3)	12 Months Ended
	Dec. 31, 2018 USD ($) Claims
2009
2009 incurred claims	$ 4,403
IBNR
Cumulative Number of Reported Claims \| Claims	1,136
2010
2009 incurred claims	$ 4,254
2010 incurred claims	5,598
IBNR
Cumulative Number of Reported Claims \| Claims	1,617
2011
2009 incurred claims	$ 4,287
2010 incurred claims	5,707
2011 incurred claims	7,603
IBNR	$ (3)
Cumulative Number of Reported Claims \| Claims	1,914
2012
2009 incurred claims	$ 4,384
2010 incurred claims	6,429
2011 incurred claims	7,678
2012 incurred claims	9,539
IBNR	$ (4)
Cumulative Number of Reported Claims \| Claims	4,702
2013
2009 incurred claims	$ 4,511
2010 incurred claims	6,623
2011 incurred claims	8,618
2012 incurred claims	9,344
2013 incurred claims	10,728
IBNR	$ 38
Cumulative Number of Reported Claims \| Claims	1,560
2014
2009 incurred claims	$ 4,609
2010 incurred claims	6,912
2011 incurred claims	9,440
2012 incurred claims	10,278
2013 incurred claims	9,745
2014 incurred claims	14,193
IBNR	$ 238
Cumulative Number of Reported Claims \| Claims	2,131
2015
2009 incurred claims	$ 4,616
2010 incurred claims	6,853
2011 incurred claims	9,198
2012 incurred claims	10,382
2013 incurred claims	9,424
2014 incurred claims	14,260
2015 incurred claims	22,340
IBNR	$ 537
Cumulative Number of Reported Claims \| Claims	2,552
2016
2009 incurred claims	$ 4,667
2010 incurred claims	6,838
2011 incurred claims	9,066
2012 incurred claims	10,582
2013 incurred claims	9,621
2014 incurred claims	14,218
2015 incurred claims	21,994
2016 incurred claims	26,062
IBNR	$ 1,096
Cumulative Number of Reported Claims \| Claims	2,862
2017
2009 incurred claims	$ 4,690
2010 incurred claims	6,840
2011 incurred claims	9,144
2012 incurred claims	10,790
2013 incurred claims	10,061
2014 incurred claims	14,564
2015 incurred claims	22,148
2016 incurred claims	24,941
2017 incurred claims	31,605
IBNR	$ 2,697
Cumulative Number of Reported Claims \| Claims	3,335
2018
2009 incurred claims	$ 4,672
2010 incurred claims	6,787
2011 incurred claims	9,171
2012 incurred claims	10,791
2013 incurred claims	10,089
2014 incurred claims	15,023
2015 incurred claims	22,491
2016 incurred claims	24,789
2017 incurred claims	32,169
2018 incurred claims	54,455
Total incurred claims	190,437
IBNR	$ 9,079
Cumulative Number of Reported Claims \| Claims	3,935

11. Property and Casualty Insurance Activity (Details 4)	Dec. 31, 2018 USD ($)
Net liability for unpaid claim and allocated claim adjustment expenses for the accident years presented	$ 38,780
All outstanding liabilities before 2007, net of reinsurance	93
Liabilities for claims and claim adjustment expenses, net of reinsurance	38,873
2009
2009	2,298
2010
2009	3,068
2010	2,566
2011
2009	3,607
2010	3,947
2011	3,740
2012
2009	3,920
2010	4,972
2011	5,117
2012	3,950
2013
2009	4,134
2010	5,602
2011	6,228
2012	5,770
2013	3,405
2014
2009	4,362
2010	6,323
2011	7,170
2012	7,127
2013	5,303
2014	5,710
2015
2009	4,424
2010	6,576
2011	8,139
2012	8,196
2013	6,633
2014	9,429
2015	12,295
2016
2009	4,468
2010	6,720
2011	8,540
2012	9,187
2013	7,591
2014	10,738
2015	16,181
2016	15,364
2017
2009	4,487
2010	6,772
2011	8,702
2012	10,236
2013	8,407
2014	11,770
2015	18,266
2016	19,001
2017	16,704
2018
2009	4,659
2010	6,780
2011	8,727
2012	10,323
2013	9,056
2014	13,819
2015	19,984
2016	21,106
2017	24,820
2018	32,383
Total	$ 151,657

11. Property and Casualty Insurance Activity (Details 5)	Dec. 31, 2018 USD ($)
Commissions and brokerage
Liabilities for claims and claim adjustment expenses, net of reinsurance	$ 38,873
Total reinsurance recoverable on unpaid claims	15,671
Unallocated claims adjustment expenses	1,653
Total gross liability for loss and LAE reserves	$ 56,197

11. Property and Casualty Insurance Activity (Details 6)	Dec. 31, 2018
Commissions and brokerage
Year One	46.40%
Year Two	18.80%
Year Three	11.40%
Year Four	8.60%
Year Five	9.50%
Year Six	5.80%
Year Seven	1.50%
Year Eight	0.70%
Year Nine	0.30%
Year Ten	3.70%

11. Property and Casualty Insurance Activity (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Property And Casualty Insurance Activity Details Narrative Abstract
Advance premiums	$ 2,107,629	$ 1,477,693
Incurred Losses and Loss Adjustment Expenses are net of reinsurance recoveries under reinsurance contracts	$ 14,482,712	$ 14,067,027

12. Stockholders' Equity (Details) - USD ($)	12 Months Ended
12. Stockholders' Equity (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Number of Options Outstanding, Beginning	341,150
Number of Options Granted	0
Number of Options Exercised	(303,650)
Number of Options Forfeited	0
Number of Options Outstanding, Ending	37,500	341,150
Number of Options Vested and Exercisable	27,500
Weighted Average Exercise Price Outstanding, Beginning	$ 6.69
Weighted Average Exercise Price Granted	0.00
Weighted Average Exercise Price Exercised	6.48
Weighted Average Exercise Price Forfeited	0.00
Weighted Average Exercise Price Outstanding, Ending	8.36	$ 6.69
Weighted Average Exercise Price Vested and Exercisable	$ 8.37
Weighted Average Remaining Contractual Life (in years) Outstanding Beginning	1 year 8 months 1 day
Weighted Average Remaining Contractual Life (in years) Outstanding Ending	2 years 2 months 26 days
Weighted Average Remaining Contractual Life (in years) Vested and Exercisable	2 years 3 months 4 days
Aggregate Intrinsic Value Outstanding, Beginning	$ 4,131,028
Aggregate Intrinsic Value Granted	$ 0
Aggregate Intrinsic Value Exercised	$ 3,794,505	$ 221,012
Aggregate Intrinsic Value Forfeited/canceled	$ 0
Aggregate Intrinsic Value Outstanding, Ending	$ 349,950	$ 4,131,028
Aggregate Intrinsic Value Vested and Exercisable	$ 256,313
Restricted Stock
Number of Options Outstanding, Beginning	47,337
Number of Options Granted	92,004
Number of Options Exercised	(15,752)
Number of Options Forfeited	(3,090)
Number of Options Outstanding, Ending	120,499	47,337
Weighted Average Exercise Price Outstanding, Beginning	$ 14.35
Weighted Average Exercise Price Granted	18.67
Weighted Average Exercise Price Exercised	14.07
Weighted Average Exercise Price Forfeited	15.00
Weighted Average Exercise Price Outstanding, Ending	$ 17.66	$ 14.35
Aggregate Intrinsic Value Outstanding, Beginning	$ 679,180
Aggregate Intrinsic Value Granted	$ 1,717,958
Aggregate Intrinsic Value Exercised	$ (221,613)
Aggregate Intrinsic Value Forfeited/canceled	$ (46,350)
Aggregate Intrinsic Value Outstanding, Ending	$ 2,129,175	$ 679,180

12. Stockholders' Equity (Details Narrative) - USD ($)	12 Months Ended
12. Stockholders' Equity (Details Narrative) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Employee Benefit Plans Details Narrative
Dividends Declared	$ 4,279,494	$ 3,214,471
Compensation Expense	$ 6,000	$ 38,025
Stock-based compensation expense related to stock options is net of estimated forfeitures	17.00%	17.00%
Intrisic Value-Options Exercised	$ 3,794,505	$ 221,012
Options Exercised - Cash proceeds	$ 90,640	$ 77,927
Options for the purchase of shares of Common Stock	15,250	13,750
Unamortized compensation cost related to unvested stock option awards	$ 1,000
Unamortized compensation cost vesting period		8 months 5 days
Shares reserved under the 2014 Plan	466,124

13. Statutory Financial Information and Accounting Policies (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Statutory Financial Information And Accounting Policies Details Narrative
Dividends paid	$ 3,600,000	$ 2,900,000
Statutory basis net income	3,801,498	7,907,743
Statutory basis surplus	$ 98,745,944	$ 101,290,282

15. Income Taxes (Details) - USD ($)	12 Months Ended
15. Income Taxes (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Income Taxes Details
Current federal income tax expense	$ (74,001)	$ 4,317,686
Current state income tax expense	(6,784)	7,353
Deferred federal and state income tax expense (benefit)	(5,398)	(1,809)
Provision for income taxes	$ (86,183)	$ 4,323,230

15. Income Taxes (Details 1) - USD ($)	12 Months Ended
15. Income Taxes (Details 1) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Income Taxes Details 4
Computed expected tax expense	$ 631,483	$ 5,008,400
Change in enacted tax rates on net deferred tax liabilities	0	(405,218)
State taxes, net of Federal benefit	(377,884)	(101,858)
State valuation allowance	390,976	124,486
Benefit of lower tax brackets	0	(100,000)
Permanent differences
Dividends received deduction	(85,703)	(138,197)
Non-taxable investment income	(40,861)	(85,684)
Excess benefit from stock-based compensation	(569,459)
Stock-based compensation	(16,960)	(25,821)
Other permanent differences	42,496	46,962
Prior year tax matters	(61,415)	4,172
Other	1,144	(4,012)
Total tax	$ (86,183)	$ 4,323,230
Computed expected tax expense	21.00%	35.00%
Change in enacted tax rates on net deferred tax liabilities	0.00%	(2.80%)
State taxes, net of Federal benefit	(12.60%)	(0.70%)
State valuation allowance	13.00%	0.90%
Benefit of lower tax brackets	0.00%	(0.70%)
Permanent differences
Dividends received deduction	(2.90%)	(1.00%)
Non-taxable investment income	(14.00%)	(0.60%)
Excess benefit from stock-based compensation	(18.90%)	0.00%
Stock-based compensation	(0.50%)	(0.20%)
Other permanent differences	1.40%	0.30%
Prior year tax matters	(2.00%)	0.00%
Other	0.00%	0.00%
Total tax	(2.90%)	30.20%

15. Income Taxes (Details 2) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Deferred tax asset:
Net operating loss carryovers (1)	$ 90,438	$ 103,655
Claims reserve discount	343,905	300,005
Unearned premium	3,145,682	2,431,301
Deferred ceding commission revenues	564,202	895,947
Other	383,733	382,522
Total deferred tax assets	4,527,960	4,113,430
Deferred tax liability:
Investment in KICO (2)	759,543	759,543
Deferred acquisition costs	3,760,625	3,117,920
Intangibles	140,700	212,100
Depreciation and amortization	664,194	328,735
Net unrealized appreciation of securities - available-for-sale	(1,151,335)	295,474
Total deferred tax liabilities	4,173,727	4,713,772
Net deferred income tax liability	$ 354,233	$ (600,342)

15. Income Taxes (Details 3) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Intrisic Value-Options Exercised
State only (A)	$ 1,305,365	$ 824,996
Valuation allowance	(1,217,027)	(725,541)
State only, net of valuation allowance	88,338	99,455
Amount subject to Annual Limitation, Federal only (B)	2,100	4,200
Total deferred tax asset from net operating loss carryovers	$ 90,438	$ 103,655

15. Income Taxes (Details 4) - USD ($)	12 Months Ended
15. Income Taxes (Details 4) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Income Taxes Details 4Abstract
Change in net deferred income tax liabilities	$ (954,575)
Deferred tax benefit allocated to other comprehensive (loss) income	(949,177)
Deferred income tax provision	$ (5,398)	$ (1,809)

15. Income Taxes (Details Narrative) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Income Taxes Details Narrative Abstract
Net operating loss carryover	$ 20,083,000	$ 12,692,000

16. Employee Benefit Plans (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Employee Benefit Plans Details Narrative Abstract
Contribution expense	$ 247,000	$ 545,000

17. Commitments and Contingencies (Details)	Dec. 31, 2018 USD ($)
Commitments And Contingencies
2019	$ 169,861
2020	175,806
2021	181,959
2022	188,382
2023	194,919
Thereafter	49,145
Total	$ 960,018

17. Commitments and Contingencies (Details Narrative) (USD $) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Commitments And Contingencies Details Narrative
Rent expenses	$ 165,368	$ 165,368

18. Earnings Per Common Share (Details) - USD ($)	12 Months Ended
18. Earnings Per Common Share (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Net Income Per Common Share Details
Weighted average number of shares outstanding	10,686,813	10,388,440
Effect of dilutive securities, common share equivalents: Stock options	$ 19,823	$ 188,983
Effect of dilutive securities, common share equivalents: Restricted stock awards	$ 10,250	$ 4,154
Weighted average number of shares outstanding, used for computing diluted earnings per share	10,716,886	10,581,577

20. Quarterly Financial Data (Details) - USD ($)	3 Months Ended								12 Months Ended
20. Quarterly Financial Data (Details) - USD ($)	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Quarterly Financial Data
Net premiums earned	$ 28,938,577	$ 27,533,907	$ 24,104,614	$ 22,837,617	$ 22,513,140	$ 21,514,408	$ 16,953,727	$ 16,369,748	$ 103,414,715	$ 77,351,023
Ceding commission revenue	901,775	1,044,529	1,691,168	1,695,158	1,725,133	1,717,610	3,305,938	3,184,452	5,332,630	9,933,133
Net investment income	1,643,022	1,602,371	1,556,866	1,383,989	1,215,475	1,033,307	1,026,004	857,800	6,186,248	4,132,586
Net (losses) gains on investments	(2,218,022)	352,025	(106,733)	(523,127)	(12,602)	20,998	130,423	(54,506)	(2,495,857)	84,313
Total revenues	29,637,933	30,885,909	27,546,186	25,701,870	25,783,212	24,614,653	21,724,251	20,647,194	113,771,898	92,769,310
Loss and loss adjustment expenses	16,556,082	13,296,708	11,176,085	17,266,330	11,364,296	7,073,323	7,454,922	8,292,996	58,295,205	34,185,537
Commission expense and other underwriting expenses	12,572,851	11,788,002	11,093,175	10,831,451	10,919,353	9,975,938	9,301,182	9,101,395	46,285,479	39,297,868
Net income	$ (879,847)	$ 3,933,730	$ 2,757,297	$ (2,717,934)	$ 1,931,592	$ 4,073,921	$ 2,510,392	$ 1,470,580	$ 3,093,246	$ 9,986,485
Basic earnings per share	$ (0.08)	$ 0.37	$ 0.26	$ (0.28)	$ 0.18	$ 0.38	$ 0.24	$ 0.15	$ 0.29	$ 0.96
Diluted earnings per share	$ (0.08)	$ 0.36	$ 0.25	$ (0.28)	$ 0.18	$ 0.38	$ 0.23	$ 0.15	$ 0.29	$ 0.94