SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended: September 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 0-11774
INVESTORS TITLE COMPANY
(Exact name of registrant as specified in its charter)
North Carolina 56-1110199
(State of Incorporation) (I.R.S. Employer)
121 North Columbia Street, Chapel Hill, North Carolina 27514
(Address of Principal Executive Offices) (Zip Code)
(919) 968-2200
(Registrant's Telephone Number Including Area Code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the Registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes X No
Shares outstanding of each of the issuer's classes of common stock as of
September 30, 1998:
Common Stock, no par value 2,800,838
Class Shares Outstanding
1
<PAGE>
INVESTORS TITLE COMPANY AND SUBSIDIARIES
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Consolidated Balance Sheets as of September 30, 1998 and December 31, 1997...3
Consolidated Statements of Income:
Three and Nine Months Ended September 30, 1998 and 1997......4
Consolidated Statements of Cash Flows:
Nine Months Ended September 30, 1998 and 1997................5
Notes to Condensed Consolidated Financial Statements.............6
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations............................................7
PART II. OTHER INFORMATION...................................................11
Item 6. Exhibits and Reports on Form 8-K....................................11
SIGNATURES...................................................................12
2
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Investors Title Company and Subsidiaries
Consolidated Balance Sheets
As of September 30, 1998 and December 31, 1997
<TABLE>
<CAPTION>
09/30/98 12/31/97
-------- --------
(Unaudited)
<S> <C> <C>
Assets
Cash and Cash Equivalents $ 5,286,325 $ 2,823,177
Investments in securities:
Held-to-maturity:
Certificates of deposit 98,982 130,985
Bonds, at amortized cost 5,290,703 4,710,481
Available-for-sale, at fair value:
Bonds 23,213,135 19,752,550
Common and nonredeemable preferred stocks 5,175,791 6,530,394
---------- ----------
Total investments 33,778,611 31,124,410
---------- ----------
Premiums receivable (less allowance for doubtful accounts:
1998: $675,000; 1997: $350,000) 4,793,990 3,372,751
Accrued interest and dividends 474,786 429,064
Prepaid expenses and other assets 438,704 462,801
Property acquired in settlement of claims 108,500 280,725
Property, net 3,277,860 2,800,079
---------- ----------
Total Assets $ 48,158,776 $ 41,293,007
========== ==========
Liabilities and Stockholders' Equity
Liabilities:
Reserves for claims (Note 2) $ 11,377,665 $ 7,622,140
Accounts payable and accrued liabilities 1,166,223 1,069,372
Commissions and reinsurance payables 103,351 96,241
Premium taxes payable 204,345 153,857
Current income taxes payable 251,623 25,081
Deferred income taxes, net 473,457 1,197,408
---------- ----------
Total liabilities 13,576,664 10,164,099
---------- ----------
Stockholders' Equity:
Common stock-no par value (shares authorized 6,000,000;
2,855,744 and 2,855,744 shares issued; and 2,800,838 and
2,800,240 shares outstanding 1998 and 1997, respectively) 701,346 879,612
Retained earnings 31,666,531 27,933,688
Net unrealized gain on investments (accumulated other comprehensive
income - Note 3)
(net of deferred taxes: 1998: $1,141,238; 1997: $1,193,461) 2,214,235 2,315,608
---------- ----------
Total stockholders' equity 34,582,112 31,128,908
---------- ----------
Total Liabilities and Stockholders' Equity $ 48,158,776 $ 41,293,007
========== ==========
</TABLE>
See notes to consolidated financial statements.
3
<PAGE>
Investors Title Company and Subsidiaries
Consolidated Statements of Income
September 30, 1998 and 1997
(Unaudited)
<TABLE>
<CAPTION>
For The Three For The Nine
Months Ended Months Ended
September 30 September 30
---------------------------------- ------------------------------------
1998 1997 1998 1997
----- ----- ----- ----
<S> <C> <C> <C> <C>
Revenues:
Underwriting income:
Premiums written $ 11,721,247 $ 8,164,156 $ 32,681,945 $ 21,355,118
Less-premiums for reinsurance ceded 42,729 57,996 255,528 168,481
---------- ---------- ---------- ----------
Net premiums written 11,678,518 8,106,160 32,426,417 21,186,637
Investment income-interest and dividends 459,947 412,742 1,325,724 1,196,461
Net realized gain on sales of investments 134,938 126,338 256,988 233,387
Other 238,231 137,101 613,791 403,166
---------- ---------- ---------- ----------
Total 12,511,634 8,782,341 34,622,920 23,019,651
---------- ---------- ---------- ----------
Operating Expenses:
Commissions to agents 4,425,467 2,709,484 12,132,478 6,969,825
Provision for claims (Note 2) 2,123,924 1,282,844 5,816,214 3,100,832
Salaries 1,696,148 1,211,227 4,393,726 3,290,496
Employee benefits and payroll taxes 331,321 394,475 1,659,236 1,344,727
Office occupancy and operations 817,000 635,446 2,356,063 1,805,762
Business development 248,517 248,382 882,723 719,134
Taxes, other than payroll and income 342,802 195,001 873,507 541,547
Professional fees 137,232 115,723 346,252 214,980
Other 146,113 108,347 390,154 371,747
----------- ---------- ---------- ----------
Total 10,268,524 6,900,929 28,850,353 18,359,050
----------- ----------- ---------- ----------
Income Before Income Taxes 2,243,110 1,881,412 5,772,567 4,660,601
----------- ---------- ---------- ----------
Provision For Income Taxes 696,170 552,840 1,782,707 1,325,501
----------- ---------- ---------- ----------
Net Income $ 1,546,940 $ 1,328,572 $ 3,989,860 $ 3,335,100
=========== ========== ========== ==========
Basic Earnings per Common Share (Note 4) $ .55 $ .48 $ 1.42 $ 1.20
=========== ========== ========== ==========
Weighted Average Shares Outstanding-Basic (Note 4) 2,805,409 2,789,123 2,805,791 2,777,217
=========== ========== =========== ==========
Diluted Earnings per Common Share (Note 4) $ .55 $ .47 $ 1.40 $ 1.18
=========== ========== =========== ==========
Weighted Average Shares Outstanding-Diluted (Note 4) 2,837,389 2,828,074 2,844,266 2,821,247
=========== ========== =========== ==========
Dividends Paid $ 85,672 $ 85,672 $ 257,017 $ 257,017
=========== ========== =========== ==========
Dividends per Share $ .03 $ .03 $ .09 $ .09
=========== =========== =========== ==========
</TABLE>
See notes to consolidated financial statements.
4
<PAGE>
Investors Title Company and Subsidiaries
Consolidated Statements of Cash Flows
For the Nine Months Ended September 30, 1998 and 1997
(Unaudited)
<TABLE>
<CAPTION>
1998 1997
----- ----
<S> <C> <C>
Operating Activities:
Net income $3,989,860 $3,335,100
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 283,761 253,330
Net (accretion) discount amortization (3,421) 3,092
Provision for losses on premiums receivable 325,000 150,000
Net (gain) loss on disposals of property (16,884) 6,991
Net realized gain on sales of investments (256,988) (233,387)
Provision for deferred income taxes (671,728) (433,480)
Provision for claims 5,816,214 3,100,832
Payments of claims, net of recoveries (2,060,689) (1,015,602)
Changes in assets and liabilities:
Increase in receivables and other assets (1,595,639) (920,401)
Increase (decrease) in accounts payable and
accrued liabilities 96,851 (1,016)
Increase (decrease) in commissions and
reinsurance payables 7,110 (13,714)
Increase in premium taxes payable 50,488 14,095
Increase in current income taxes payable 226,542 219,063
--------------- --------------
Net cash provided by operating activities 6,190,477 4,464,903
--------------- --------------
Investing Activities:
Purchases of available-for-sale securities (3,869,637) (6,757,604)
Purchases of held-to-maturity securities (1,025,057) 0
Proceeds from sales of available-for-sale securities 1,921,332 2,250,316
Proceeds from sales of held-to-maturity securities 425,974 512,023
Purchases of property (775,567) (273,921)
Proceeds from sales of property 30,909 30,080
--------------- --------------
Net cash used in investing activities (3,292,046) (4,239,106)
--------------- --------------
Financing Activities:
Distributions (repurchases) of common stock (178,266) 95,914
Dividends paid (257,017) (257,017)
--------------- ---------------
Net cash used in financing activities (435,283) (161,103)
--------------- --------------
Net Increase in Cash and Cash Equivalents 2,463,148 64,694
Cash and Cash Equivalents, Beginning of Year 2,823,177 4,244,570
--------------- --------------
Cash and Cash Equivalents, End of Period $5,286,325 $4,309,264
=============== ==============
Supplemental Disclosures:
Cash Paid During the Year for:
Interest $ 6,052 $ 0
=============== ==============
Income Taxes $2,229,061 $1,540,075
=============== ==============
</TABLE>
See notes to consolidated financial statements.
5
<PAGE>
INVESTORS TITLE COMPANY
AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
September 30, 1998
(Unaudited)
Note 1 - Basis of Presentation
The consolidated financial statements include Investors Title Company
and its subsidiaries, and have been prepared in conformity with generally
accepted accounting principles.
In the opinion of management all necessary adjustments have been
reflected for a fair presentation of the financial position, results of
operations and cash flows in the accompanying unaudited consolidated financial
statements. All such adjustments are of a normal recurring nature.
Reference should be made to the "Notes to Consolidated Financial
Statements" of the Registrant's Annual Report to Shareholders for the year ended
December 31, 1997 for a description of accounting policies.
Note 2 - Reserves for Claims
Transactions in the reserves for claims for the nine months ended
September 30, 1998 were as follows:
Balance, beginning of year $ 7,622,140
Provision, charged to operations 5,816,214
Recoveries 142,844
Payments of claims (2,203,533)
---------------
Balance, September 30, 1998 $ 11,377,665
===============
In management's opinion, the reserves are adequate to cover claim
losses which might result from pending and possible claims.
Note 3 - Comprehensive Income
In June 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 130, Reporting Comprehensive Income ("SFAS
130"). The Company adopted SFAS 130 as of January 1, 1998.
Other comprehensive income is comprised solely of unrealized gains or losses on
the Company's available-for-sale securities. Total comprehensive income for the
three months ended September 30, 1998 and 1997 was $1,299,446 and $1,765,779,
respectively. Total comprehensive income for the nine months ended September 30,
1998 and 1997 was $3,888,487 and $3,820,479, respectively.
Note 4 - Earnings Per Common Share
The Company adopted Financial Accounting Standards Board Statement of Financial
Accounting Standards No. 128, Earnings Per Share ("SFAS 128") effective December
6
<PAGE>
31, 1997.
The total increase in the weighted average shares outstanding related to these
equivalent shares was 31,980 and 38,951 for the three months ending September
30, 1998 and 1997, respectively and 38,475 and 44,030 for the nine months ending
September 30, 1998 and 1997, respectively.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
The 1997 Form 10-K and the 1997 Annual Report should be read
in conjunction with the following discussion since they contain important
information for evaluating the Company's operating results and financial
condition.
Results of Operations:
For the quarter ended September 30, 1998, net premiums written
increased 44% to $11,678,518, investment income increased 11% to $459,947,
revenues increased 42% to $12,511,634 and net income increased 16% to $1,546,940
all compared with the same quarter in 1997. Net income per share, for both basic
and diluted common shares, increased to $.55, representing increases of 15% and
17%, respectively, as compared with the year ago period.
For the nine months ended September 30, 1998, net premiums
written increased 53% to $32,426,417, investment income increased 11% to
$1,325,724, revenues increased 50% to $34,622,920, net income increased 20% to
$3,989,860 and net income per basic and diluted common share increased 18% and
19% to $1.42 and $1.40, all respectively, compared with the same period in 1997.
Growth in sales has resulted from the Company's efforts to
profitably expand the distribution of products and an extremely healthy real
estate market. The robust economic conditions experienced in the first half of
the year carried into the third quarter although they have since declined from
peak mid year volume. Sales of existing homes remained strong during the third
quarter. According to the Mortgage Bankers Association of America, the monthly
average 30-year fixed mortgage interest rates declined to 7.00% for the nine
months ended September 30, 1998 compared with 7.73% for the nine months ended
September 30, 1997. The volume of business continued to increase in the third
quarter of 1998 as the number of policies and commitments issued rose to 70,700,
an increase of 40% compared with 50,592 in the same period in 1997. Policies and
commitments issued for the nine months ended September 30, 1998 were 201,995
compared with 132,373 in 1997.
Shown below is a breakdown of branch and agency premiums:
Three Months Ended Nine Months Ended
September 30 September 30
------------ ------------
1998 % 1997 % 1998 % 1997 %
---- - ---- - ---- - ---- -
Branch $5,552,868 48 $4,214,875 52 $15,640,526 48 $11,239,489 53
Agency 6,125,650 52 3,891,285 48 16,785,891 52 9,947,148 47
---------- -- --------- -- ---------- -- --------- --
Total $11,678,518 100 $8,106,160 100 $32,426,417 100 $21,186,637 100
=========== === ========== === ========== === ========== ===
7
<PAGE>
Shown below is a schedule of title premiums written for the
three and nine months ended September 30, 1998 and 1997 in all states where our
two insurance subsidiaries, Investors Title Insurance Company and Northeast
Three Months Ended Nine Months Ended
September 30 September 30
------------------------------------------------------------
1998 1997 1998 1997
---- ---- ---- ----
Arkansas $ 0 $ 0 $ 17,711 $ 0
Florida 20,406 18,939 67,022 58,774
Georgia 99,551 129,467 382,641 441,117
Indiana 42,841 21,319 109,128 70,537
Kentucky 75 173 177 173
Maryland 135,300 22,113 313,734 70,717
Michigan 2,294,357 1,389,510 6,474,095 3,306,942
Minnesota 314,892 51,491 731,368 59,210
Mississippi 4,109 3,407 28,172 19,177
Nebraska 229,216 108,913 631,351 439,522
New York 148,235 99,573 386,854 317,103
North Carolina 5,505,769 4,201,611 15,622,885 11,113,444
Pennsylvania 0 0 250 0
South Carolina 1,055,599 819,752 2,494,285 1,920,101
Tennessee 60,910 34,060 144,444 110,627
Virginia 1,758,108 1,257,248 5,180,644 3,383,219
West Virginia 35,453 0 35,453 0
---------------------------------------------------------
Direct Premiums 11,704,821 8,157,576 32,620,214 21,310,663
Reinsurance, net (26,303) (51,416) (193,797) (124,026)
---------------------------------------------------------
Net Premiums $ 11,678,518 $ 8,106,160 $32,426,417 $21,186,637
=========== ========== ============ ===========
Total operating expenses increased 49% and 57% for the three
and nine months ended September 30, 1998, respectively compared with the same
periods in 1997. The increase in commissions is the result of the Company's
expansion into new markets primarily by continuing to develop agency
relationships. Salaries and employee benefits increased primarily due to
additional staffing needed to process the increase in premium volume. Office
occupancy and operations, business development and premium taxes rose primarily
due to the increase in premium volume.
The provision for claims as a percentage of net premiums
written was 18% for both the three and nine months ended September 30, 1998,
versus 16% and 15%, respectively, for the same periods in 1997. The reserves for
claims have increased $3,755,525 in 1998 compared with year-end based on premium
growth, claims experience and management's assessment of the reserve.
8
<PAGE>
Income tax expense as a percentage of income before income taxes was 31% and 28%
for the nine months ended September 30, 1998 and 1997, respectively. The
increase in 1998 was primarily the result of an increase in deferred tax expense
related to the provision for claims and an increase in income from taxable
sources.
Liquidity and Capital Resources:
Net cash provided by operating activities for the nine months
ended September 30, 1998, amounted to $6,190,477 compared with $4,464,903 for
the same nine month period during 1997. This increase is primarily the result of
an increase in premiums as compared with the prior period, partially offset by
an increase in commissions expense.
On December 9, 1996, the Board of Directors approved the
repurchase by the Company of shares of the Company's common stock from time to
time at prevailing market prices. The purpose of the repurchases is to avoid
dilution to existing shareholders as a result of issuances of stock in
connection with stock options and stock bonuses. Pursuant to this approval, the
Company has repurchased 43,277 shares at an average price of $20.30 per share as
of October 31, 1998, including 10,044 shares purchased at an average purchase
price of $23.47 during the quarter ended September 30, 1998. The Board has
authorized management to repurchase up to an additional 106,723 shares.
Management believes that funds generated from operations
(primarily underwriting and investment income) will enable the Company to
adequately meet its operating needs. In addition to operational liquidity, the
Company maintains a high degree of liquidity within the investment portfolio in
the form of short-term investments and other readily marketable securities.
Other Matters
Year 2000 Issues
In September 1998, the Company created and filled a new position of Vice
President of Information Systems. In addition to overall responsibility for the
Company's information systems, the individual in this position is leading the
Company's Year 2000 Project Committee (the "Committee"), which is comprised of
department heads or high level managers representing each of the Company's
departments. The Vice President of Information Systems is responsible for
coordinating the Company's Year 2000 compliance efforts, including an
evaluation of the Company's internal systems as well as an assessment of the
level of preparedness of other companies with whom the Company does business
where the Year 2000 compliance of that entity might materially impact the
Company's operations.
The Committee has adopted a three phase approach with estimated completion dates
as follows: awareness (fourth quarter 1998), assessment (first quarter 1999) and
implementation (third quarter 1999). In the awareness phase, the Committee and
the Company as a whole will become educated about the nature of the Year 2000
problem, particularly as it applies to the Company's business circumstances.
During the assessment phase the Committee will identify potential points of
failure, in addition to determining Year 2000 compliance status of such
functions. In the implementation phase, the
9
<PAGE>
Committee will begin by implementing any necessary modifications to those
systems which serve critical functions and will proceed to address other less
critical systems later in the process.
The Company is currently in the process of inventorying all hardware and
software for date-sensitive function. As part of a regular technology refresh
cycle, the Company is currently replacing most existing PC workstations and
servers. Desktop operating systems, network operating systems and commercial
offtheshelf application suites are also being standardized and upgraded to Year
2000 compliant versions.
This replacement strategy has the added benefit of obtaining vendor
representations that all hardware and operating system software being purchased,
are Year 2000 compliant. The Company previously budgeted for these technology
upgrades therefore additional costs specifically allocated to Year 2000
compliance efforts are expected to be minimal. The Company currently estimates
that costs directly attributable solely to its Year 2000 compliance program will
be less than $500,000.
The Company is currently completing an inventory of all embedded system
technology under the assessment phase. Upon completion of the inventory, the
Company will evaluate the results and determine how to proceed.
The Company is also working with its third-party business partners and vendors
to assure they are on schedule to detect and address any Year 2000 problems that
might affect the Company's systems or business processes. The Company will
assess and attempt to mitigate risks with respect to the failure of any mission
critical third-party business partners and vendors to be Year 2000 ready.
The Company's preparation of contingency plans for Year 2000 related
occurrences is ongoing, and will continue throughout 1999. The elements of the
contingency plan will depend upon the results of the Company's awareness and
assessment phases, and will become better defined as these phases are completed.
The Company's current assessment of the most likely Year 2000 related
worst case scenario is that it may experience a decline in its volume of
business or a delay in its ability to write title insurance as a result of
failure of various functions and services in the real estate transaction
business generally. Any such failure would be likely to impact others in the
industry as well, and the Company has no reason to believe that it would be any
more adversely affected than other title insurance companies.
Although the Company believes it will have completed all phases of its Year 2000
initiative in sufficient time to identify and remedy any non-compliant programs
and systems and avoid any material adverse impact on its business, failure of
third-party business partners and governmental services to be Year-2000
compliant, as well as a possible downturn in the economy due to Year 2000
related failures, could have a material adverse effect on the Company's
operations.
Safe Harbor Statement
Except for the historical information presented, the matters
disclosed in the foregoing discussion and analysis and other parts of this
report include forward-looking statements.
10
<PAGE>
These statements represent the
Company's current judgment on the future and are subject to risks and
uncertainties that could cause actual results to differ materially. Such factors
include, without limitation: (i) that the demand for title insurance will vary
with factors beyond the control of the Company such as changes in mortgage
interest rates, availability of mortgage funds, level of real estate activity,
cost of real estate, consumer confidence, supply and demand for real estate,
inflation and general economic conditions; (ii) that losses from claims may be
greater than anticipated such that reserves for possible claims are inadequate;
(iii) that unanticipated adverse changes in securities markets could result in
material losses on investments made by the Company; and (iv) the dependence of
the Company on key management personnel the loss of whom could have a material
adverse affect on the Company's business. The Company's discussion of Year 2000
issues under the heading "Other Matters" contains forward-looking statements
that are subject to risks and uncertainties that could cause the actual results
to differ from those projected. These include the risks associated with
unforeseen technological issues associated with the Company's own Year 2000
compliance efforts and the compliance efforts of third parties on whose systems
the Company relies. Other risks and uncertainties may be described from time to
time in the Company's other reports and filings with the Securities and Exchange
Commission.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(27) Financial Data Schedule included herewith.
(b) Reports on Form 8-K
There were no reports filed on Form 8-K for this quarter.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this Report to be signed in its behalf by the
undersigned hereunto duly authorized.
INVESTORS TITLE COMPANY
(Registrant)
By: /s/ James A. Fine, Jr.
--------------------------
James A. Fine, Jr.
President
By: /s/Elizabeth P. Bryan
--------------------------
Elizabeth P. Bryan
Vice President
(Principal Accounting Officer)
Dated: November 12, 1998
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 7
<LEGEND>
*Not disclosed on a quarterly basis.
</LEGEND>
<S> <C> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS 9-MOS
<FISCAL-YEAR-END> DEC-31-1998 DEC-31-1998 DEC-31-1998
<PERIOD-END> MAR-31-1998 JUN-30-1998 SEP-30-1998
<DEBT-HELD-FOR-SALE> 20,229,252 22,059,438 23,213,125
<DEBT-CARRYING-VALUE> 5,163,585 5,376,128 5,175,791
<DEBT-MARKET-VALUE> 0* 0* 0*
<EQUITIES> 6,648,115 6,385,988 5,389,685
<MORTGAGE> 0 0 0
<REAL-ESTATE> 0 0 0
<TOTAL-INVEST> 32,172,677 33,920,536 33,778,611
<CASH> 3,652,670 4,764,362 5,286,325
<RECOVER-REINSURE> 0 0 0
<DEFERRED-ACQUISITION> 0 0 0
<TOTAL-ASSETS> 43,694,307 47,235,580 48,158,776
<POLICY-LOSSES> 8,498,765 10,002,165 11,377,665
<UNEARNED-PREMIUMS> 0 0 0
<POLICY-OTHER> 89,210 175,088 103,351
<POLICY-HOLDER-FUNDS> 0 0 0
<NOTES-PAYABLE> 0 0 0
0 0 0
0 0 0
<COMMON> 979,002 902,942 701,346
<OTHER-SE> 31,420,716 32,666,992 33,880,766
<TOTAL-LIABILITY-AND-EQUITY> 43,694,307 47,235,580 48,158,776
9,441,848 20,747,899 32,426,417
<INVESTMENT-INCOME> 420,286 865,777 1,325,724
<INVESTMENT-GAINS> 70,175 122,050 256,988
<OTHER-INCOME> 150,011 375,560 613,791
<BENEFITS> 1,564,370 3,692,290 5,816,214
<UNDERWRITING-AMORTIZATION> 0 0 0
<UNDERWRITING-OTHER> 6,991,832 14,889,539 23,034,139
<INCOME-PRETAX> 1,526,118 3,529,457 5,772,567
<INCOME-TAX> 458,497 1,086,537 1,782,707
<INCOME-CONTINUING> 1,067,621 2,442,920 3,989,860
<DISCONTINUED> 0 0 0
<EXTRAORDINARY> 0 0 0
<CHANGES> 0 0 0
<NET-INCOME> 1,067,621 2,442,920 3,989,860
<EPS-PRIMARY> .38 .87 1.42
<EPS-DILUTED> .38 .86 1.40
<RESERVE-OPEN> 0 0 0
<PROVISION-CURRENT> 0 0 0
<PROVISION-PRIOR> 0 0 0
<PAYMENTS-CURRENT> 0 0 0
<PAYMENTS-PRIOR> 0 0 0
<RESERVE-CLOSE> 0 0 0
<CUMULATIVE-DEFICIENCY> 0 0 0
</TABLE>