FORM 10Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
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 No. 2-8381-NY
ARISTA INVESTORS CORP.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 13-2957684
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
------------------------------ -------------------
16 John Street, New York, N.Y. 10038
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212)964-2150
Indicate by check mark whether the registrant has filed all reports required to
be filed by Section 13 or 15 (d) 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____
The aggregate number of Registrant's outstanding shares on November 13, 1996 was
2,570,100 Class A Common Stock, $0.01 par value (excluding 10,000 shares of
treasury stock) and 47,400
Class B Common Stock, $0.01 par value.
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<PAGE>
ARISTA INVESTORS CORP.
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements:
Consolidated Balance Sheets at September 30, 1996 3
(Unaudited) and December 31, 1995
Consolidated Statements of Operations (Unaudited) for 5
the three months and nine months ended September 30,
1996 and 1995
Consolidated Statements of Changes in Stockholders' 6
Equity, for the nine months ended September 30, 1996
(Unaudited) and the year ended December 31, 1995
Consolidated Statements of Cash Flows (Unaudited) 7
for the nine months ended September 30, 1996 and 1995
Notes to Consolidated Financial Statements 8
(Unaudited)
Item 2. Management's Discussions and Analysis of
Financial Condition and Results of Operations:
Management's Discussion and Analysis of 12
Financial Condition and Results of Operations
PART II. OTHER INFORMATION
Item 1 through Item 6 15
Signatures 16
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<PAGE>
PART I. FINANCIAL INFORMATION
ARISTA INVESTORS CORP.
CONSOLIDATED BALANCE SHEETS
September 30, December 31,
1996 1995
----------- -----------
(unaudited)
ASSETS
Investments:
Held to maturity securities:
Bonds and long-term U. S. Treasury
obligations at amortized cost (market
value - $2,696,055 at September 30, 1996
and $2,692,276 at December 31, 1995) $ 2,699,359 $ 2,654,939
Available-for-sale securities:
Redeemable preferred stocks, at market value
(amortized cost of $84,149 at September 30,
1996 and $141,344 at December 31, 1995) 67,668 129,502
Trading security, at market value (cost of
$1,279 at September 30, 1996 and December
31, 1995) 339 660
----------- -----------
Total investments 2,767,366 2,785,101
Cash and equivalents 6,803,122 6,777,328
Premiums receivable, net 2,322,750 2,565,853
Deferred policy acquisition costs, net 852,023 1,060,381
Furniture and office equipment, at cost, net of
accumulated depreciation of $711,012 at September
30, 1996 and $661,552 at December 31, 1995 151,016 193,549
Prepaid and refundable income taxes 736,065 765,877
Notes receivable shareholder, secured (Note 5) 500,000 --
Other assets 1,237,626 926,114
----------- -----------
Total Assets $15,369,968 $15,074,203
=========== ===========
(Continued)
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<PAGE>
ARISTA INVESTORS CORP.
CONSOLIDATED BALANCE SHEETS
September 30, December 31,
1996 1995
------------ ------------
(unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Payable to reinsurers $ 104,308 $ 161,476
Net claims liabilities 2,158,660 2,263,158
Net unearned premiums 718,180 664,105
Net commissions payable 1,281,532 1,303,888
Accounts payable and accrued expenses 855,358 772,969
Deferred income taxes 491,429 622,427
Surplus note payable, net 2,861,250 2,850,000
------------ ------------
Total Liabilities 8,470,717 8,638,023
------------ ------------
Commitments and contingencies: (Note 2)
Stockholders' equity:
Class A common stock, $.01 par value;
9,950,000 shares authorized; 2,580,100
shares and outstanding at September 30,
1996 and 1,940,600 shares issued and
outstanding at December 31, 1995 25,801 19,406
Common stock, Class B, $.01 par value; 50,000
shares authorized, 47,400 shares issued and
outstanding 474 474
Additional paid-in capital 5,082,259 4,193,354
Paid-in capital attributed to detachable
warrant 150,000 150,000
Retained earnings 1,683,938 2,111,528
Net unrealized loss on marketable securities (16,481) (11,842)
------------ ------------
6,925,991 6,462,920
Less 10,000 shares Class A common stock in
treasury, at cost (26,740) (26,740)
------------ ------------
Total Stockholders' Equity 6,899,251 6,436,180
------------ ------------
Total Liabilities & Stockholders' Equity $ 15,369,968 $ 15,074,203
============ ============
The accompanying notes are an integral part of these financial statements.
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<PAGE>
ARISTA INVESTORS CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
---------------------------- ----------------------------
1996 1995 1996 1995
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Revenue:
Gross premiums earned (Note 2) $ 6,119,849 $ 6,274,927 $ 17,728,849 $ 19,345,480
Ceded premiums earned (Note 2) 3,059,925 3,137,464 8,864,425 9,672,740
------------ ------------ ------------ ------------
Net premiums earned 3,059,924 3,137,463 8,864,424 9,672,740
Net realized investment losses (321) -- (529) (137)
Investment income 102,723 79,507 294,046 187,552
Other income 79,754 52,279 205,561 179,841
------------ ------------ ------------ ------------
Total revenue 3,242,080 3,269,249 9,363,502 10,039,996
------------ ------------ ------------ ------------
Expenses:
Underwriting (Note 2):
Gross claims incurred 3,814,810 4,135,514 11,715,848 12,620,834
Ceded claims incurred 1,907,405 2,067,757 5,857,924 6,310,417
------------ ------------ ------------ ------------
Net claims incurred 1,907,405 2,067,757 5,857,924 6,310,417
------------ ------------ ------------ ------------
Gross commissions incurred 1,056,146 1,156,028 3,174,210 3,332,133
Ceded commissions incurred 1,053,071 1,006,957 2,718,406 3,168,867
------------ ------------ ------------ ------------
Net commissions incurred 3,075 149,071 455,804 163,266
------------ ------------ ------------ ------------
Total underwriting expenses 1,910,480 2,216,828 6,313,728 6,473,683
General and administrative expenses 1,159,838 1,148,691 3,619,664 3,496,096
------------ ------------ ------------ ------------
Total expenses 3,070,318 3,365,519 9,933,392 9,969,779
------------ ------------ ------------ ------------
Income (loss) before income taxes (benefit) 171,762 (96,270) (569,890) 70,217
Provision for income taxes (benefit) 62,700 (48,362) (142,300) 42,370
------------ ------------ ------------ ------------
Net income (losses) 109,062 (47,908) (427,590) 27,847
============ ============ ============ ============
Net income (loss) per common share $ 0.04 ($ 0.02) ($ 0.16) $ 0.01
============ ============ ============ ============
Weighted average number of common
shares outstanding 2,617,500 2,265,923 2,617,500 2,302,459
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
ARISTA INVESTORS CORP.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
Nine months ended September 30, 1996 (unaudited) and year
ended December 31, 1995
<TABLE>
<CAPTION>
Class A Class B
Common Stock Common Stock
--------------------------- ---------------------------
Number Par Number Par Additional
of value of value Paid-in
Shares $.01 Shares $.01 capital
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Balance - January 1, 1995 1,940,600 $ 19,406 47,400 $ 474 $ 4,193,354
Net gain -- -- -- -- --
Net investment gains -- -- -- -- --
Issuance of surplus note -- -- -- -- --
------------ ------------ ------------ ------------ ------------
Balance - December 31, 1995 1,940,600 19,406 47,400 474 4,193,354
Net loss (unaudited) -- -- -- -- --
Net investment gains (unaudited) -- -- -- -- --
Proceeds from issuance of shares of Class A
Common Stock under the Incentive Stock Option
Plan, from a Warrant and from a Non-qualified
Stock Option 639,500 6,395 -- -- 888,905
------------ ------------ ------------ ------------ ------------
Balance - September 30, 1996 (unaudited) 2,580,100 $ 25,801 47,400 $ 474 $ 5,082,259
============ ============ ============ ============ ============
Paid-in
capital Class A
attributed Net common
to unrealized stock
Retained detachable loss on held in
earnings warrants investments treasury Total
------------ ------------ ------------ ------------ ------------
Balance - January 1, 1995 $ 1,855,005 $ -- ($ 30,278) ($ 26,740) $ 6,011,221
Net gain 256,523 -- -- -- 256,523
Net investment gains -- -- 18,436 -- 18,436
Issuance of surplus note -- 150,000 -- -- 150,000
------------ ------------ ------------ ------------ ------------
Balance - December 31, 1995 2,111,528 150,000 (11,842) (26,740) 6,436,180
Net loss (unaudited) (427,590) -- -- -- (427,590)
Net investment gains (unaudited) -- -- (4,639) -- (4,639)
Proceeds from issuance of shares of Class A
Common Stock under the Incentive Stock Option
Plan, from a Warrant and from a Non-qualified
Stock Option -- -- -- -- 895,300
------------ ------------ ------------ ------------ ------------
Balance - September 30, 1996 (unaudited) $ 1,683,938 $ 150,000 ($ 16,481) ($ 26,740) $ 6,899,251
============ ============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
ARISTA INVESTORS CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine months ended September 30, 1996 and 1995
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (427,590) $ 27,847
Adjustments to reconcile net income to net cash provided
by (used in) operating activities:
Depreciation 49,460 39,834
Discount on surplus note 11,250 --
Amortization of intangible assets -- 93,360
Amortization of deferred acquisition costs 245,984 (473,304)
Deferred income taxes/(benefit) (130,998) (9,769)
(Increase) decrease in operating assets:
Premiums receivable 243,103 684,750
Deferred policy acquisition costs 147,203 225,779
Prepaid and refundable income taxes 29,812 (108,559)
Notes receivable shareholder, secured (500,000) --
Other assets (311,512) (38,739)
Increase (decrease) in operating liabilities:
Accounts payable and accrued expenses 82,389 (197,944)
Payable to reinsurer (57,168) 39,719
Net claims liabilities (104,498) (184,220)
Net unearned premiums 54,075 67,557
Commissions payable (22,356) 73,457
----------- -----------
Net cash provided by (used in) operating activities (690,846) 239,768
----------- -----------
Cash flows from investing activities:
Capital expenditures (6,927) (112,732)
Proceeds from sale of investments 57,195 219,297
Purchases of investments (44,099) (336,983)
Payments to acquire new insurance business (184,829) --
----------- -----------
Net cash used in investing activities (178,660) (230,418)
----------- -----------
Cash flows from financing activities:
Issuance of Class A common stock 895,300 --
----------- -----------
Net cash provided by financing activities 895,300 --
----------- -----------
Increase in cash and equivalents 25,794 9,350
Cash and equivalents:
Beginning of year 6,777,328 2,724,864
----------- -----------
September 30, $ 6,803,122 $ 2,734,214
=========== ===========
Supplemental cash flow disclosure:
Cash paid during the period for income taxes $ 293,401 $ 394,256
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
ARISTA INVESTORS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1996 and 1995
(Unaudited)
Note 1 - Nature of Operations
Arista Investors Corp. through its wholly-owned subsidiary, Arista Insurance
Company ("Arista"), (together, the "Company" or the "Registrant") is engaged
principally in the sale and underwriting of statutory disability benefits
insurance in the State of New York. Arista is regulated by the New York State
Insurance Department. Statutory disability benefits insurance presently provides
for a payment to totally disabled employees in the amount of 50% of weekly
salary to a maximum payment of $170 per week, for a maximum of 26 weeks
beginning with the eighth day of disability due to off-the-job accident or
sickness. On-the-job accident or sickness is covered by worker's compensation
insurance, not statutory disability insurance.
Arista currently has agreements with over 390 general insurance agents. These
agents place statutory disability benefits insurance with other insurance
companies in addition to Arista. These general agents submit to Arista insurance
written through more than 6,900 insurance brokers and soliciting agents. Arista
pays commissions to each general agent, who, in turn, is responsible for the
payment of any commissions due to brokers or soliciting agents engaged by the
general agent.
Arista also acts as a third party administrator for the statutory disability
benefits books of business of other insurance companies for which it receives a
fee based upon earned premiums. Fees for these services have not and do not
exceed 2% of Arista's total revenues earned.
Note 2 - Basis of presentation
The accompanying consolidated financial statements are prepared on the basis of
generally accepted accounting principles ("GAAP"). GAAP differs from statutory
accounting principles ("SAP") used by insurance companies in reporting to state
regulatory agencies. In the opinion of the management of Arista Investors Corp.,
all adjustments (consisting of normal recurring accruals only) have been
reflected for a fair
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<PAGE>
ARISTA INVESTORS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1996 and 1995
(Unaudited)
presentation of the unaudited financial position as of September 30, 1996 and
the results of operations for the nine-month and three-month periods ended
September 30, 1996 and 1995. The operating results for the periods are not
necessarily indicative of the results to be expected for the entire year.
Note 3 - Estimates and Assumptions
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
effect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
revenues and expenses during the reporting period. Actual results could differ
from those estimates.
Note 4 - Reinsurance
From October 1, 1993 to September 30, 1995, Arista had a quota share reinsurance
agreement with NRG America Reassurance Corporation (during 1995, its name was
subsequently changed to Harbourton Reinsurance, Inc., "Harbourton") whereby
Arista ceded, by way of reinsurance, a 50% quota share of Arista's liability
with respect to disability benefits issued to policy- holders. For this,
Harbourton received a fee based on premiums ceded.
Effective October 1, 1995, Arista entered into an agreement with The Cologne
Life Reinsurance Company ("Cologne") whereby Arista cedes, by way of
reinsurance, a 50% quota share participation in Arista's disability benefits
insurance, both for business in force as of October 1, 1995 and for new business
written or acquired after October 1, 1995. This agreement is subject to
cancellation by either party on 90 days' prior written notice.
A contingent liability exists with respect to reinsurance ceded which would
become a liability of Arista in the event that the reinsurer is unable to meet
its proportionate share of the obligations assumed under the Agreement.
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<PAGE>
ARISTA INVESTORS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1996 and 1995
(unaudited)
Note 5 - Related parties
Bernard Kooper, President of the Company, Chairman of the Boards of Directors of
the Company and Arista and a Director of The Collection Group, Inc.,
beneficially owns 20.52% and 100% of the outstanding shares of Class A and Class
B Common Stock, respectively (including 30,400 shares of Class A Common Stock
owned by Arlyne Kooper, wife of Bernard Kooper), which includes 365,000 shares
of the Company's Class A Common Stock issued upon the exercise of a warrant in
June 1996. Mr. Kooper exercised this warrant by delivering $11,000 in cash and a
five-year Secured Promissory Note in the amount of $500,000 to Arista Investors
Corp. The note is payable in a lump sum in five years and is secured by the
365,000 shares of Class A Common Stock issued upon the exercise. Interest on the
note is payable quarterly. This does not include shares of Class A Common Stock
owned by Louis H. Saltzman, son-in-law of Mr.
Kooper.
Mr. Kooper is also the owner of Bernard Kooper Life Agency, Inc. (the "Agency"),
one of the general agents of Arista. The Agency received approximately $165,000
and $169,000 in commissions from Arista during the nine months ended September
30, 1996 and 1995, respectively. Of this amount, the Agency paid approximately
$116,000 and $121,000 during the nine months ended September 30, 1996 and 1995,
respectively, to brokers, which included certain members of the Board of
Directors of the Company and Arista. The amount paid to members of the Board of
Directors of the Company and/or Arista by the Agency was approximately $20,000
and $17,000 during the nine months ended September 30, 1996 and 1995,
respectively. Commissions payable to the Agency at September 30, 1996 and 1995
were $11,622 and $9,567, respectively.
Note 6 - Policy acquisitions
Arista has incurred costs under various agreements it has entered into while
acquiring the right to offer New York State statutory disability benefits
coverage to former policyholders of other disability carriers. The costs include
professional fees and finder's fees as well as fees paid directly to these
disability carriers for such right. For financial statement
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<PAGE>
ARISTA INVESTORS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1996 and 1995
(unaudited)
purposes, such costs are deferred and are being amortized to income over five
years. The costs for all acquisitions amounted to $2,306,121 and $2,153,202 at
September 30, 1996 and 1995, respectively. Accumulated amortization was
$1,454,098 and $1,110,690 at September 30, 1996 and 1995, respectively.
Amortization of deferred acquisition costs charged to operations aggregated
$245,984 and $225,778 for the nine months ended September 30, 1996 and 1995,
respectively.
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<PAGE>
ARISTA INVESTORS CORP.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
September 30, 1996
(Unaudited)
Results of Operations
The Company's net loss for the first nine months of 1996 was approximately
$428,000; the Company's net income for the third quarter ended September 30,
1996 was approximately $109,000. For the first nine months of 1995, the
Company's net income was approximately $28,000; for the third quarter ended
September 30, 1995, the Company had a net loss of approximately $48,000.
Arista's gross premiums earned were approximately $17.7 million and $19.3
million for the first nine months of 1996 and 1995, respectively. Gross premiums
earned for the third quarters of 1996 and 1995 were approximately $6.1 million
and $6.3 million, repectively. The reduction in gross premiums earned was the
result of Arista's termination of its assumption reinsurance agreement during
the first quarter of 1996 wherein Arista had assumed Hawaii Temporary Disability
Insurance Business that had been ceded by Allianz Life Insurance Company of
North America together with a continuation of the net loss of covered lives and
of policyholders.
Arista's gross claims incurred for the first nine months of 1996 were
approximately $11.7 million, representing 66.1% of gross premiums earned. For
the first nine months of 1995, gross claims incurred were approximately $ 12.6
million, representing 65.2% of gross premiums earned. For the third quarters of
1996 and 1995, the gross claims incurred ratios were 62.3% and 65.9%,
respectively. As reported at June 30, 1996, these ratios were 69.5% and 57.8%
for the second quarters of 1996 and 1995, respectively. It is not possible for
management to predict whether or not such short-range quarterly changes in the
gross claims incurred are indicative of future trends.
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<PAGE>
ARISTA INVESTORS CORP.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
September 30, 1996
(Unaudited)
Consolidated investment income for the first nine months of 1996 and 1995 were
approximately $294,000 and $188,000, respectively. For the third quarters of
1996 and 1995, consolidated investment income was approximately $103,000 and
$80,000, respectively. This increase reflects income earned on the proceeds
received by Arista upon the issuance of a surplus note.
Other income for the first nine months of 1996 and 1995 was approximately
$206,000 and $180,000, respectively. Other income includes third-party
administration fees of approximately $187,000 and $150,000 earned by Arista
during the first nine months of 1996 and 1995, respectively. This increase was
attributable to additional business serviced under Arista's third-party
administration agreements. For the third quarter of 1996 and 1995, other income
was approximately $80,000 and $52,000, respectively.
Arista's gross commissions incurred as a percentage of gross premiums earned
were 17.9% and 17.2% for the first nine months of 1996 and 1995, respectively.
In addition, the ratios of gross commissions incurred to gross premiums earned
during the third quarters of 1996 and 1995 were 17.3% and 18.4%, respectively.
The consolidated general and administrative expenses for the first nine months
of 1996 and 1995 were approximately $3.6 million and $3.5 million, respectively.
This increase was due principally to interest expense incurred during the first
nine months of 1996 of approximately $248,000 on the surplus note issued by
Arista. For the third quarters of 1996 and 1995, the consolidated general and
administrative expenses were approximately $1.2 and $1.1, respectively.
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<PAGE>
ARISTA INVESTORS CORP.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
September 30, 1996
(Unaudited)
Liquidity and Capital Resources
Retained earnings increased from $6,436,180 at December 31, 1995 to $6,899,251
at September 30, 1996 as a result of the Company's issuance of 639,500 shares of
Class A Common Stock upon the exercise of warrants, non-qualified stock options
and incentive stock options. This increase was offset by a net loss of
approximately $427,000 for the first nine months of 1996.
Management believes that Arista's statutory capital and surplus of approximately
$5.9 million at September 30, 1996 is sufficient to support its current annual
premium level.
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<PAGE>
ARISTA INVESTORS CORP.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Nothing to report.
Item 2. Changes in Securities
Nothing to report
Item 3. Defaults Upon Senior Securities
Nothing to report.
Item 4. Submission of Matters to a Vote of Security Holders
Nothing to report.
Item 5. Other Information
Nothing to report.
Item 6. Exhibits and Reports on Form 8-K
a. Exhibit 27 - Financial Data Schedule
b. Reports on Form 8-K: None
-15-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ARISTA INVESTORS CORP. (Registrant)
BY: /S/ BERNARD KOOPER
----------------------------------------
BERNARD KOOPER, President and
Chairman of the Board (principal
executive officer)
BY: /S/ SUSAN J. HALL
----------------------------------------
SUSAN J. HALL, Senior Vice President
and Treasurer (principal financial
and accounting officer)
November 14, 1996
-16-
<TABLE> <S> <C>
<ARTICLE> 7
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<DEBT-HELD-FOR-SALE> 0
<DEBT-CARRYING-VALUE> 2,699,359
<DEBT-MARKET-VALUE> 2,696,055
<EQUITIES> 68,007
<MORTGAGE> 0
<REAL-ESTATE> 0
<TOTAL-INVEST> 2,767,366
<CASH> 6,803,122
<RECOVER-REINSURE> 0
<DEFERRED-ACQUISITION> 852,023
<TOTAL-ASSETS> 15,369,968
<POLICY-LOSSES> 2,158,660
<UNEARNED-PREMIUMS> 718,180
<POLICY-OTHER> 0
<POLICY-HOLDER-FUNDS> 0
<NOTES-PAYABLE> 2,861,250
0
0
<COMMON> 26,275
<OTHER-SE> 6,872,976
<TOTAL-LIABILITY-AND-EQUITY> 15,369,968
8,864,424
<INVESTMENT-INCOME> 294,046
<INVESTMENT-GAINS> (529)
<OTHER-INCOME> 205,561
<BENEFITS> 5,857,924
<UNDERWRITING-AMORTIZATION> 245,984
<UNDERWRITING-OTHER> 6,547,890
<INCOME-PRETAX> (569,890)
<INCOME-TAX> (142,300)
<INCOME-CONTINUING> (427,590)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (427,590)
<EPS-PRIMARY> (0.16)
<EPS-DILUTED> (0.16)
<RESERVE-OPEN> 4,526,316
<PROVISION-CURRENT> 557,220
<PROVISION-PRIOR> (766,216)
<PAYMENTS-CURRENT> 7,579,381
<PAYMENTS-PRIOR> 4,287,608
<RESERVE-CLOSE> 4,317,320
<CUMULATIVE-DEFICIENCY> 0
</TABLE>
