Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 23, 2021 | Jun. 30, 2020 | |
Registrant CIK | 0000318673 | ||
Fiscal Year End | --12-31 | ||
Registrant Name | Security National Financial Corporation | ||
SEC Form | 10-K | ||
Period End date | Dec. 31, 2020 | ||
Tax Identification Number (TIN) | 87-0345941 | ||
Entity Public Float | $ 50,000,000 | ||
Filer Category | Non-accelerated Filer | ||
Current with reporting | Yes | ||
Interactive Data Current | Yes | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Shell Company | false | ||
Small Business | true | ||
Emerging Growth Company | false | ||
Entity Incorporation, State or Country Code | UT | ||
Entity File Number | 000-09341 | ||
Entity Address, Address Line One | 121 West Election Road | ||
Entity Address, Address Line Two | Suite 100 | ||
Entity Address, City or Town | Draper | ||
Entity Address, State or Province | UT | ||
Entity Address, Postal Zip Code | 84020 | ||
City Area Code | (801) | ||
Local Phone Number | 264-1060 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Common Class A | |||
Number of common stock shares outstanding | 16,621,147 | ||
Common Class C | |||
Number of common stock shares outstanding | 2,679,603 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Investments: | ||
Fixed maturity securities, available for sale, at estimated fair value | $ 294,656,679 | $ 355,977,820 |
Equity securities at estimated fair value | 11,324,239 | 7,271,165 |
Mortgage loans held for investment (net of allowances for loan losses of $2,005,127 and $1,453,037 for 2020 and 2019) | 249,343,936 | 236,694,546 |
Real estate held for investment (net of accumulated depreciation of $13,800,973 and $12,788,739 for 2020 and 2019) | 131,684,453 | 102,756,946 |
Real estate held for sale | 7,878,807 | 14,097,627 |
Other investments and policy loans (net of allowances for doubtful accounts of $1,645,475 and $1,448,026 for 2020 and 2019) | 73,696,661 | 60,245,269 |
Accrued investment income | 5,360,523 | 4,833,232 |
Total investments | 773,945,298 | 781,876,605 |
Cash and cash equivalents | 106,219,429 | 127,754,719 |
Loans held for sale at estimated fair value | 422,772,418 | 213,457,632 |
Receivables (net of allowances for doubtful accounts of $1,685,382 and $1,724,156 for 2020 and 2019) | 10,899,207 | 9,236,330 |
Restricted assets (including $3,989,415 and $2,985,347 for 2020 and 2019 at estimated fair value) | 16,150,036 | 13,935,317 |
Cemetery perpetual care trust investments (including $2,810,070 and $2,581,124 for 2020 and 2019 at estimated fair value) | 6,413,167 | 4,411,864 |
Receivable from reinsurers | 15,569,156 | 15,747,768 |
Cemetery land and improvements | 8,761,436 | 9,519,950 |
Deferred plicy and pre-need contract acquisition costs | 100,075,276 | 94,701,920 |
Mortgage servicing rights, net | 35,210,516 | 17,155,529 |
Property and equipment, net | 12,473,345 | 14,600,394 |
Value of business acquired | 8,955,249 | 9,876,647 |
Goodwill | 3,519,588 | 3,519,588 |
Other | 27,976,357 | 18,649,812 |
Total Assets | 1,548,940,478 | 1,334,444,075 |
Liabilities | ||
Future policy benefits and unpaid claims | 844,790,087 | 825,600,918 |
Unearned premium reserve | 3,328,623 | 3,621,697 |
Bank and other loans payable | 297,824,368 | 217,572,612 |
Deferred pre-need cemetery and mortuary contract revenues | 13,080,179 | 12,607,978 |
Cemetery Perpetual Care Trust Obligation | 4,087,704 | 3,933,719 |
Accounts payable | 8,932,683 | 5,056,983 |
Other liabilities and accrued expenses | 87,650,981 | 50,652,591 |
Income Taxes | 25,258,800 | 18,686,972 |
Total liabilities | 1,284,953,425 | 1,137,733,470 |
Stockholders' Equity | ||
Preferred stock - non-voting-$1.00 par value; 5,000,000 shares authorized; none issued or outstanding | 0 | 0 |
Additional paid-in capital | 50,287,253 | 46,091,112 |
Accumulated other comprehensive income, net of taxes | 23,243,133 | 13,726,514 |
Retained earnings | 153,739,167 | 101,256,229 |
Treasury stock, at cost - 227,852 Class A shares and 10,985 Class C shares in 2020; 490,823 Class A shares and -0- Class C shares in 2019 | (1,833,272) | (1,580,582) |
Total stockholders' equity | 263,987,053 | 196,710,605 |
Total Liabilities and Stockholders' Equity | 1,548,940,478 | 1,334,444,075 |
Common Class A | ||
Stockholders' Equity | ||
Common Stock, Value, Issued | 33,191,566 | 32,215,558 |
Common Class B | ||
Stockholders' Equity | ||
Common Stock, Value, Issued | 0 | 0 |
Common Class C | ||
Stockholders' Equity | ||
Common Stock, Value, Issued | $ 5,359,206 | $ 5,001,774 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Allowance for Loan and Lease Losses, Real Estate | $ 2,005,127 | $ 1,453,037 |
Real Estate Investment Property, Accumulated Depreciation | 13,800,973 | 12,788,739 |
Allowance for Doubtful Accounts, Premiums and Other Receivables | 1,645,475 | 1,448,026 |
Accounts Receivable, Allowance for Credit Loss | 1,685,382 | 1,724,156 |
Aggregate Fair Value, Restricted Assets | 3,989,415 | 2,985,347 |
Aggregate Fair Value, Cemetary Perpetual Care Trust Investments | $ 2,810,070 | $ 2,581,124 |
Preferred Stock, Par or Stated Value Per Share | $ 1 | $ 1 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Class A | ||
Common Stock, Par or Stated Value Per Share | $ 2 | $ 2 |
Common Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Common Stock, Shares, Issued | 16,595,783 | 16,107,779 |
Common Stock, Shares, Outstanding | 0 | 0 |
Common Class B | ||
Common Stock, Par or Stated Value Per Share | $ 1 | $ 1 |
Common Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Common Stock, Shares, Issued | 0 | 0 |
Common Stock, Shares, Outstanding | 0 | 0 |
Common Class C | ||
Common Stock, Par or Stated Value Per Share | $ 2 | $ 2 |
Common Stock, Shares Authorized | 3,000,000 | 3,000,000 |
Common Stock, Shares, Issued | 2,679,603 | 2,500,887 |
Common Stock, Shares, Outstanding | 0 | 0 |
Treasury Class A | ||
Treasury Stock, Shares | 227,852 | 490,823 |
Treasury Class C | ||
Treasury Stock, Shares | 10,985 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues: | ||
Mortgage fee income | $ 298,933,110 | $ 131,976,082 |
Insurance premiums and other considerations | 93,020,617 | 81,860,610 |
Net investment income | 56,329,803 | 43,019,473 |
Net mortuary and cemetery sales | 20,307,435 | 15,296,235 |
Gains on investments and other assets | 1,925,850 | 728,367 |
Other than temporary impairments on investments | (370,975) | 0 |
Other | 11,317,482 | 10,180,163 |
Total revenues | 481,463,322 | 283,060,930 |
Benefits and expenses: | ||
Death benefits | 59,040,130 | 41,591,057 |
Surrenders and other policy benefits | 3,801,230 | 3,320,748 |
Increase in future policy benefits | 23,568,650 | 23,568,497 |
Amortization of deferred policy and pre-need acquisition costs and value of business acquired | 14,307,425 | 14,634,577 |
Selling, general and administrative expenses: | ||
Commissions | 124,426,297 | 56,762,891 |
Personnel | 84,989,971 | 64,221,270 |
Advertising | 5,380,896 | 4,784,558 |
Rent and rent related | 6,873,561 | 7,055,456 |
Depreciation on property and equipment | 2,078,738 | 1,711,369 |
Provision for loan loss reserve | 16,506,030 | 0 |
Costs related to funding mortgage loans | 9,877,700 | 6,278,954 |
Other | 47,331,102 | 34,922,761 |
Interest expense | 8,578,810 | 7,386,688 |
Cost of goods and services sold - cemeteries and mortuaries | 3,252,655 | 2,878,169 |
Total benefits and expenses | 410,013,195 | 269,116,995 |
Earnings before income taxes | 71,450,127 | 13,943,935 |
Income tax expense | (15,853,514) | (3,050,416) |
Net earnings | $ 55,596,613 | $ 10,893,519 |
Net earnings per Class A Equivalent common share | $ 2.95 | $ 0.59 |
Net earnings per Class A Equivalent common share-assuming dilution | $ 2.88 | $ 0.58 |
Weighted-average Class A equivalent common share outstanding | 18,831,991 | 18,562,056 |
Weighted-average Class A equivalent common shares outstanding-assuming dilution | 19,275,251 | 18,689,602 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Text Block [Abstract] | ||
Net earnings | $ 55,596,613 | $ 10,893,519 |
Other comprehensive income: | ||
Unrealized gains on fixed maturity securities available for sale | 12,013,692 | 17,315,770 |
Unrealized gains on restricted assets | 41,225 | 35,550 |
Unrealized gains (losses) on cemetery perpetual care trust investments | (6,817) | 29,904 |
Foreign currency translation adjustments | (46) | 972 |
Other comprehensive income, before income tax | 12,048,054 | 17,382,196 |
Income tax benefit (expense) | (2,531,435) | (3,652,859) |
Other comprehensive income, net of income tax | 9,516,619 | 13,729,337 |
Comprehensive income | $ 65,113,232 | $ 24,622,856 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) | Class A Common Stock | Class C Common Stock | Additional Paid-In Capital | Other Comprehensive Income / Loss | Retained Earnings | Treasury Stock | Total |
Stockholders' Equity Attributable to Parent, Beginning Balance at Dec. 31, 2018 | $ 30,609,596 | $ 4,387,286 | $ 41,821,778 | $ (2,823) | $ 95,201,732 | $ (206,396) | $ 171,811,173 |
Net earnings | 10,893,519 | 10,893,519 | |||||
Other comprehensive income | 13,729,337 | 13,729,337 | |||||
Stock based compensation expense | 256,996 | 256,996 | |||||
Exercise of stock options | 65,034 | 382,886 | 415,990 | 863,910 | |||
Sale of treasury stock | 529,858 | 165,702 | 695,560 | ||||
Purchase of treasury stock | (1,539,888) | 1,539,888 | |||||
Stock dividends | 1,534,356 | 238,174 | 3,066,490 | (4,839,022) | (2) | ||
Conversion Class C to Class A | 6,572 | (6,572) | |||||
Stockholders' Equity Attributable to Parent, Ending Balance at Dec. 31, 2019 | 32,215,558 | 5,001,774 | 46,091,112 | 13,726,514 | 101,256,229 | (1,580,582) | 196,710,605 |
Net earnings | 55,596,613 | 55,596,613 | |||||
Other comprehensive income | 9,516,619 | 9,516,619 | |||||
Stock based compensation expense | 358,878 | 358,878 | |||||
Exercise of stock options | 137,940 | 261,640 | 432,572 | 832,152 | |||
Sale of treasury stock | 1,224,877 | 2,715,071 | 3,939,948 | ||||
Purchase of treasury stock | (2,967,761) | 2,967,761 | |||||
Stock dividends | 810,420 | 123,440 | 2,179,814 | (3,113,675) | (1) | ||
Conversion Class C to Class A | 27,648 | (27,648) | |||||
Stockholders' Equity Attributable to Parent, Ending Balance at Dec. 31, 2020 | $ 33,191,566 | $ 5,359,206 | $ 50,287,253 | $ 23,243,133 | $ 153,739,167 | $ (1,833,272) | $ 263,987,053 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | ||
Net earnings | $ 55,596,613 | $ 10,893,519 |
Adjustments to reconcile net earnings to net cash used in operating activities: | ||
Gains on investments and other assets | (1,925,850) | (728,367) |
Other than temporary impairments on investments | 370,975 | 0 |
Depreciation | 5,447,363 | 5,183,658 |
Provision for loan losses and doubtful accounts | 1,577,370 | 1,202,688 |
Net amortization of deferred fees and costs, premiums and discounts | (1,227,773) | (887,605) |
Provision for deferred income taxes | 2,854,669 | (1,857,897) |
Policy and pre-need acquisition costs deferred | (18,909,921) | (19,176,531) |
Policy and pre-need acquisition costs amortized | 13,520,600 | 13,787,037 |
Value of business acquired amortized | 786,825 | 847,540 |
Mortgage servicing rights, additions | (29,896,465) | (4,194,502) |
Amortization of mortgage servicing rights | 11,841,478 | 7,055,795 |
Stock based compensation expense | 358,878 | 256,996 |
Benefit plans funded with treasury stock | 3,939,948 | 695,560 |
Net change in fair value of loans held for sale | (10,413,492) | (2,498,097) |
Originations of loans held for sale | (5,627,013,749) | (2,606,839,175) |
Proceeds from sales of loans held for sale | 5,600,045,285 | 2,580,875,055 |
Net gains on sales of loans held for sale | (188,893,379) | (80,666,413) |
Change in assets and liabilities: | ||
Land and improvements held for sale | 758,514 | 358,477 |
Future policy benefits and unpaid claims | 25,804,740 | 18,394,928 |
Other operating assets and liabilities | 25,750,164 | 1,695,259 |
Net cash used in operating activities | (129,627,207) | (75,602,075) |
Cash flows from investing activities: | ||
Purchases of fixed maturity securities | (58,493,147) | (110,601,438) |
Sales, calls and maturities of fixed maturity securities | 131,269,730 | 26,624,182 |
Purchases of equity securities | (6,991,832) | (3,264,028) |
Sales of equity securities | 3,902,835 | 2,639,729 |
Net changes in restricted assets | (1,954,437) | (1,254,991) |
Net changes in perpetual care trusts | (2,755,856) | 299,897 |
Mortgage loans held for investment, other investments and policy loans made | (682,170,126) | (572,171,590) |
Payments received for mortgage loans held for investment, other investments and policy loans | 672,544,708 | 556,352,676 |
Purchase of property and equipment | (1,630,734) | (1,839,293) |
Sale of property and equipment | 194,955 | 54,496 |
Purchases of real estate | (40,190,471) | (8,572,556) |
Sales of real estate | 22,418,816 | 11,614,927 |
Cash received for reinsurance assumed | 0 | 158,358,594 |
Cash paid for purchase of subsidiaries, net of cash acquired | 0 | (20,141,074) |
Net cash provided by investing activities | 36,144,441 | 38,099,531 |
Cash flows from financing activities: | ||
Investment contract receipts | 11,511,118 | 12,141,627 |
Investment contract withdrawals | (18,235,107) | (16,911,841) |
Proceeds from stock options exercised | 832,152 | 863,910 |
Purchase of treasury stock | (2,967,761) | (1,539,888) |
Repayment of bank loans | (174,865,813) | (236,790,722) |
Proceeds from bank loans | 164,586,365 | 196,610,127 |
Net change in warehouse line borrowings for loans held for sale | 90,351,225 | 69,928,331 |
Net cash provided by financing activities | 71,212,179 | 24,301,544 |
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents | (22,270,587) | (13,201,000) |
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period | 137,735,673 | 150,936,673 |
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period | 115,465,086 | 137,735,673 |
Cash paid during the year for: | ||
Interest (net of amount capitalized) | 8,385,270 | 7,284,078 |
Income taxes | 11,813,120 | 4,861,318 |
Non Cash Investing and Financing Activities: | ||
Transfer of loans held for sale to mortgage loans held for investment | 16,960,549 | 31,881,851 |
Accrued real estate construction costs and retainage | 6,365,534 | 590,256 |
Right-of-use assets obtained in exchange for operating lease liabilities | 5,631,193 | 16,544,406 |
Mortgage loans held for investment foreclosed into real estate held for investment | 686,124 | 1,704,015 |
Right-of-use assets obtained in exchange for finance lease liabilities | 8,494 | 252,763 |
Transfer of real estate held for investment to property and equipment | 0 | 3,261,259 |
Transfer of property and equipment to real estate held for investment | 1,516,700 | 0 |
Mortgage loans held for investment foreclosed into receivables | $ 0 | $ 155,347 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Text Block [Abstract] | ||
Cash and cash equivalents | $ 106,219,429 | $ 127,754,719 |
Restricted assets | 8,842,744 | 8,674,214 |
Cemetery perpetual care trust investments | 402,913 | 1,306,740 |
Total cash, cash equivalents, restricted cash and restricted cash equivalents | $ 115,465,086 | $ 137,735,673 |
1) Significant Accounting Polic
1) Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
1) Significant Accounting Policies | 1) Significant Accounting Policies General Overview of Business Security National Financial Corporation and its wholly owned subsidiaries (the “Company”) operate in three reportable business segments: life insurance, cemetery and mortuary, and mortgages. The life insurance segment is engaged in the business of selling and servicing selected lines of life insurance, annuity products and accident and health insurance marketed primarily in the Intermountain West, California and eleven southern states. The cemetery and mortuary segment of the Company consists of eight mortuaries and five cemeteries in Utah and one cemetery in California. The mortgage segment is an approved government and conventional lender that originates and underwrites residential and commercial loans for new construction, existing homes and real estate projects primarily in Florida, Nevada, Texas, and Utah. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP). Principles of Consolidation These consolidated financial statements include the financial statements of the Company and its majority owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. Use of Estimates Management of the Company has made a number of estimates and assumptions related to the reported amounts of assets and liabilities, reported amounts of revenues and expenses, and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with GAAP. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant changes in the near term are those used in determining the value of derivative assets and liabilities; those used in determining deferred acquisition costs and the value of business acquired; those used in determining the value of mortgage loans foreclosed to real estate held for investment; those used in determining the liability for future policy benefits; those used in determining the value of mortgage servicing rights; those used in determining allowances for loan losses for mortgage loans held for investment; those used in determining loan loss reserve; and those used in determining deferred tax assets and liabilities. Although some variability is inherent in these estimates, management believes the amounts provided are fairly stated in all material respects. Investments The Company’s management determines the appropriate classifications of investments in fixed maturity securities and equity securities at the acquisition date and re-evaluates the classifications at each balance sheet date. Fixed maturity securities available for sale Equity securities Mortgage loans held for investment Mortgage loans are secured by the underlying property and require an appraisal at the time of underwriting and funding. Generally, the Company will fund a loan not to exceed 80% of the loan’s collateral fair market value. Amounts over 80% will require additional collateral or mortgage insurance by an approved third-party insurer. Real estate held for investment Real estate held for sale Other investments and policy loans Gains and losses on investments (except for equity securities carried at fair value through net earnings) Cash and Cash Equivalents The Company considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. The Company maintains its cash in bank deposit accounts, which at times exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents. Loans Held for Sale Accounting Standards Codification (“ASC”) No. 825, “Financial Instruments”, allows for the option to report certain financial assets and liabilities at fair value initially and at subsequent measurement dates with changes in fair value included in earnings. The option may be applied instrument by instrument, but it is irrevocable. The Company elected the fair value option for loans held for sale. The Company believes the fair value option most closely aligns the timing of the recognition of gains and costs. These loans are intended for sale and the Company believes that the fair value is the best indicator of the resolution of these loans. Electing fair value also reduces certain timing differences and better matches changes in the fair value of these assets with changes in the fair value of the related derivatives used for these assets. See Note 3 and Note 17 to Consolidated Financial Statements for additional disclosures regarding loans held for sale. Mortgage Fee Income Mortgage fee income consists of origination fees, processing fees, interest income and certain other income related to the origination of mortgage loans held for sale. All revenues and costs are recognized when the mortgage loan is funded and any changes in fair value are shown as a component of mortgage fee income. See Note 3 and Note 17 to Consolidated Financial Statements for additional disclosures regarding loans held for sale. The Company, through its mortgage subsidiaries, sells mortgage loans to third-party investors without recourse unless defects are identified in the representations and warranties made at loan sale. It may be required, however, to repurchase a loan or pay a fee instead of repurchase under certain events, which include the following: · Failure to deliver original documents specified by the investor, · The existence of misrepresentation or fraud in the origination of the loan, · The loan becomes delinquent due to nonpayment during the first several months after it is sold, · Early pay-off of a loan, as defined by the agreements, · Excessive time to settle a loan, · Investor declines purchase, and · Discontinued product and expired commitment. Loan purchase commitments generally specify a date 30 to 45 days after delivery upon which the underlying loans should be settled. Depending on market conditions, these commitment settlement dates can be extended at a cost to the Company. It is the Company's policy to cure any documentation problems regarding such loans at a minimal cost for up to a six-month time period and to pursue efforts to enforce loan purchase commitments from third-party investors concerning the loans. The Company believes that six months allows adequate time to remedy any documentation issues, to enforce purchase commitments, and to exhaust other alternatives. Remedial methods include the following: · Research reasons for rejection, · Provide additional documents, · Request investor exceptions, · Appeal rejection decision to purchase committee, and · Commit to secondary investors. Once purchase commitments have expired and other alternatives to remedy are exhausted, which could be earlier than the six-month time period, the loans are repurchased and transferred to the long-term investment portfolio at the lower of cost or fair value and previously recorded mortgage fee income that was to be received from a third-party investor is written off against the loan loss reserve. Determining Lower of Cost or Fair Value Cost for loans held for sale is equal to the amount paid to the warehouse bank and the amount originally funded by the Company. Fair value is often difficult to determine, but is based on the following: · For loans that are committed, the Company uses the commitment price. · For loans that are non-committed that have an active market, the Company uses the market price. · For loans that are non-committed where there is no market but there is a similar product, the Company uses the market value for the similar product. · For loans that are non-committed where no active market exists, the Company determines that the unpaid principal balance best approximates the market value, after considering the fair value of the underlying real estate collateral, estimated future cash flows, and the loan interest rate. The appraised value of the real estate underlying the original mortgage loan adds support to the Company’s determination of fair value because if the loan becomes delinquent, the Company has sufficient value to collect the unpaid principal balance or the carrying value of the loan, thus minimizing credit losses. The majority of loans originated are sold to third-party investors. The amounts expected to be sold to investors are shown on the consolidated balance sheets as loans held for sale. Loan Loss Reserve The loan loss reserve is an estimate of probable losses at the balance sheet date that the Company will realize in the future on loans sold. The Company may be required to reimburse third-party investors for costs associated with early payoff of loans within six months of origination of such loans and to repurchase loans where there is a default in any of the first four monthly payments to the investors or, in lieu of repurchase, to pay a negotiated fee to the investors. The Company’s estimates are based upon historical loss experience and the best estimate of the probable loan loss liabilities. Upon completion of a transfer that satisfies the conditions to be accounted for as a sale, the Company initially measures at fair value liabilities incurred in a sale relating to any guarantee or recourse provisions. The Company accrues a monthly allowance for indemnification losses to investors based on total production. This estimate is based on the Company’s historical experience and is included as a component of mortgage fee income. Subsequent updates to the recorded liability from changes in assumptions are recorded in selling, general and administrative expenses as a component of provision for loan loss reserve. The estimated liability for indemnification losses is included in other liabilities and accrued expenses. The loan loss reserve analysis involves mortgage loans that have been sold to third-party investors, which were believed to have met investor underwriting guidelines at the time of sale, where the Company has received a demand from the investor. There are generally three types of demands: make whole, repurchase, or indemnification. These types of demands are further described as follows: Make whole demand Repurchase demand Indemnification demand The Company believes the allowance for loan losses and the loan loss reserve represent probable loan losses incurred as of the balance sheet date. Additional information related to the Loan Loss Reserve is included in Note 3. Restricted Assets Restricted assets are assets held in a trust account for future mortuary services and merchandise and consist of cash and cash equivalents; participations in mortgage loans held for investment with Security National Life Insurance Company (“Security National Life”); mutual funds carried at estimated fair value; equity securities carried at estimated fair value; and a surplus note with Security National Life (which is eliminated in consolidation). Restricted assets also represents escrows held for borrowers and investors under servicing and appraisal agreements relating to mortgage loans, funds held by warehouse banks in accordance with loan purchase agreements and funds held in escrow for certain real estate construction development projects. Additionally, the Company funded its medical benefit safe-harbor limit based on the qualified direct costs, and has included this amount as a component of restricted cash. Cemetery Perpetual Care Trust Investments Cemetery endowment care trusts have been set up for four of the six cemeteries owned by the Company. Under endowment care arrangements a portion of the price for each lot sold is withheld and invested in a portfolio of investments similar to those described in the prior paragraph. The earnings stream from the investments is designed to fund future maintenance and upkeep of the cemetery. Cemetery Land and Improvements The development of a cemetery involves not only the initial acquisition of raw land but also the installation of roads, water lines, landscaping and other costs to establish a marketable cemetery lot. The costs of developing the cemetery are shown as an asset on the balance sheet. The amount on the balance sheet is reduced by the total cost assigned to the development of a particular lot when the criterion for recognizing a sale of that lot is met. Deferred Policy Acquisition Costs and Value of Business Acquired Commissions and other costs, net of commission and expense allowances for reinsurance ceded, that vary with and are primarily related to the production of new insurance business have been deferred. Deferred policy acquisition costs (“DAC”) for traditional life insurance are amortized over the premium paying period of the related policies using assumptions consistent with those used in computing policy benefit reserves. For interest-sensitive insurance products, deferred policy acquisition costs are amortized generally in proportion to the present value of expected gross profits from surrender charges, investment, mortality and expense margins. This amortization is adjusted when estimates of current or future gross profits to be realized from a group of products are reevaluated. Deferred acquisition costs are written off when policies lapse or are surrendered. When accounting for DAC, the Company considers internal replacements of insurance and investment contracts. An internal replacement is a modification in product benefits, features, rights or coverage that occurs by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to contract, or by the election of a feature or coverage within a contract. Modifications that result in a replacement contract that is substantially changed from the replaced contract are accounted for as an extinguishment of the replaced contract. Unamortized DAC, unearned revenue liabilities and deferred sales inducements from the replaced contract are written-off. Modifications that result in a contract that is substantially unchanged from the replaced contract are accounted for as a continuation of the replaced contract. Value of business acquired is the present value of estimated future profits of the acquired business and is amortized similar to deferred policy acquisition costs. Mortgage Servicing Rights Mortgage Servicing Rights (“MSR”) arise from contractual agreements between the Company and third-party investors (or their agents) when mortgage loans are sold. Under these contracts, the Company is obligated to retain and provide loan servicing functions on loans sold, in exchange for fees and other remuneration. The servicing functions typically performed include, among other responsibilities, collecting and remitting loan payments; responding to borrower inquiries; accounting for principal and interest, holding custodial (impound) funds for payment of property taxes and insurance premiums; counseling delinquent mortgagors; and supervising the acquisition of real estate owned and property dispositions. The total residential mortgage loans serviced for others consist primarily of agency conforming fixed-rate mortgage loans. The value of MSRs is derived from the net cash flows associated with the servicing contracts. The Company receives a servicing fee of generally about 0.250% annually on the remaining outstanding principal balances of the loans. Based on the result of the cash flow analysis, an asset or liability is recorded for mortgage servicing rights. The servicing fees are collected from the monthly payments made by the mortgagors. The Company generally receives other remuneration including rights to various mortgagor-contracted fees such as late charges, and collateral reconveyance charges and the Company is generally entitled to retain the interest earned on funds held pending remittance of mortgagor principal, interest, tax and insurance payments. Contractual servicing fees and late fees are included in other revenues on the consolidated statements of earnings. The Company’s subsequent accounting for MSRs is based on the class of MSRs. The Company has identified two classes of MSRs: MSRs backed by mortgage loans with initial term of 30 years and MSRs backed by mortgage loans with initial term of 15 years. The Company distinguishes between these classes of MSRs due to their differing sensitivities to change in value as the result of changes in market. After being initially recorded at fair value, MSRs backed by mortgage loans are accounted for using the amortization method. Amortization expense is included in other expenses on the consolidated statements of earnings. MSR amortization is determined by amortizing the MSR balance in proportion to, and over the period of the estimated future net servicing income of the underlying financial assets. Interest rate risk, prepayment risk, and default risk are inherent risks in MSR valuation. Interest rate changes largely drive prepayment rates. Refinance activity generally increases as rates decline. A significant decrease in rates beyond expectation could cause a decline in the value of the MSR. On the contrary, if rates increase borrowers are less likely to refinance or prepay their mortgage, which extends the duration of the loan and MSR values are likely to rise. Because of these risks, discount rates and prepayment speeds are used to estimate the fair value. The Company periodically assesses MSRs for impairment. Impairment occurs when the current fair value of the MSR falls below the asset’s carrying value (carrying value is the amortized cost reduced by any related valuation allowance). If MSRs are impaired, the impairment is recognized in current period earnings and the carrying value of the MSRs is adjusted through a valuation allowance. Management periodically reviews the various loan strata to determine whether the value of the MSRs in a given stratum is impaired and likely to recover. When management deems recovery of the value to be unlikely in the foreseeable future, a write-down of the cost of the MSRs for that stratum to its estimated recoverable value is charged to the valuation allowance. Property and Equipment Property and equipment are recorded at cost. Depreciation is calculated principally on the straight-line method over the estimated useful lives of the assets which range from three to forty years. Leasehold improvements paid for by the Company as a lessee are amortized over the lesser of the useful life or remaining lease terms. Long-lived Assets Long-lived assets to be held and used, including property and equipment and real estate held for investment, are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the fair value of the asset, and long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell. No impairment of long-lived assets has been recognized in the accompanying financial statements except for certain impairments of real estate held for investment as disclosed in Note 2. Derivative Instruments Mortgage Banking Derivatives Loan Commitments The Company is exposed to price risk due to the potential impact of changes in interest rates on the values of loan commitments from the time a loan commitment is made to an applicant to the time the loan that would result from the exercise of that loan commitment is funded. Managing price risk is complicated by the fact that the ultimate percentage of loan commitments that will be exercised (i.e., the number of loans that will be funded) fluctuates. The probability that a loan will not be funded or the loan application is denied or withdrawn within the terms of the commitment is driven by a number of factors, particularly the change, if any, in mortgage rates following the issuance of the loan commitment. In general, the probability of funding increases if mortgage rates rise and decreases if mortgage rates fall. This is due primarily to the relative attractiveness of current mortgage rates compared to the applicant’s committed rate. The probability that a loan will not be funded within the terms of the mortgage loan commitment also is influenced by the source of the applications (retail, broker or correspondent channels), proximity to rate lock expiration, purpose for the loan (purchase or refinance), product type and the application approval status. The Company has developed fallout estimates using historical data that take into account all of the variables, as well as renegotiations of rate and point commitments that tend to occur when mortgage rates fall. These fallout estimates are used to estimate the number of loans that the Company expects to be funded within the terms of the loan commitments and are updated periodically to reflect the most current data. The Company estimates the fair value of a loan commitment based on the change in estimated fair value of the underlying mortgage loan, quoted mortgage-backed securities (“MBS”) prices, estimates of the fair value of mortgage servicing rights, and an estimate of the probability that the mortgage loan will fund within the terms of the commitment. The change in fair value of the underlying mortgage loan is measured from the date the loan commitment is issued and is shown net of expenses. Following issuance, the value of a loan commitment can be either positive or negative depending upon the change in value of the underlying mortgage loans. Forward Sale Commitments The Company utilizes forward commitments to economically hedge the price risk associated with its outstanding mortgage loan commitments. A forward commitment protects the Company from losses on sales of the loans arising from exercise of the loan commitments. Management expects these types of commitments will experience changes in fair value opposite to changes in fair value of the loan commitments, thereby reducing earnings volatility related to the recognition in earnings of changes in the values of the commitments. The net changes in fair value of loan commitments and forward sale commitments are shown in current earnings as a component of mortgage fee income on the consolidated statements of earnings. Mortgage banking derivatives are shown in other assets and other liabilities and accrued expenses on the consolidated balance sheets. Call and Put Option Derivatives The Company uses a strategy of selling “out of the money” call options on its equity securities as a source of revenue. The options give the purchaser the right to buy from the Company specified equity securities at a set price up to a pre-determined date in the future. The Company uses the strategy of selling put options as a means of generating cash or purchasing equity securities at lower than current market prices. The Company receives an immediate payment of cash for the value of the option and establishes a liability for the fair value of the option. The liability for options is adjusted to fair value at each reporting date. In the event a call option is exercised, the Company sells the equity security at a favorable price enhanced by the value of the option that was sold. If the option expires unexercised, the Company recognizes a gain from the expired option. In the event a put option is exercised, the Company acquires an equity security at the strike price of the option reduced by the value received from the sale of the put option. The equity security is then treated as a normal equity security in the Company’s portfolio. The net changes in the fair value of call and put options are shown in current earnings as a component of realized gains (losses) on investments and other assets. Call and put options are shown in other liabilities and accrued expenses on the consolidated balance sheets. Allowance for Doubtful Accounts and Loan Losses and Impaired Loans The Company records an allowance and recognizes an expense for potential losses from mortgage loans held for investment, other investments and receivables in accordance with GAAP. Receivables are the result of cemetery and mortuary operations, mortgage loan operations and life insurance operations. The allowance is based upon the Company’s historical experience for collectively evaluated impairment. Other allowances are based upon receivables individually evaluated for impairment. Collectability of the cemetery and mortuary receivables is significantly influenced by current economic conditions. The critical issues that impact recovery of mortgage loan operations are interest rate risk, loan underwriting, new regulations and the overall economy. The Company provides for losses on its mortgage loans held for investment through an allowance for loan losses (a contra-asset account). The allowance is comprised of two components. The first component is an allowance for collectively evaluated impairment that is based upon the Company’s historical experience in collecting similar receivables. The second component is based upon individual evaluation of loans that are determined to be impaired. Upon determining impairment, the Company establishes an individual impairment allowance based upon an assessment of the fair value of the underlying collateral. See the schedules in Note 2 for additional information. The allowance for losses on mortgage loans held for investment could change based on changes in the value of the underlying collateral, the performance status of the loans, or the Company’s actual collection experience. The actual losses could change, in the near term, from the established allowance, based upon the occurrence or non-occurrence of these events. For purposes of determining the allowance for losses, the Company has segmented its mortgage loans held for investment by loan type. The Company’s loan types are commercial, residential, and residential construction. The inherent risks within the portfolio vary depending upon the loan type as follows: Commercial Residential Residential construction (including land acquisition and development) Future Policy Benefits and Unpaid Claims Future policy benefit reserves for traditional life insurance are computed using a net level method, including assumptions as to investment yields, mortality, morbidity, withdrawals, and other assumptions based on the life insurance subsidiaries’ experience, modified as necessary to give effect to anticipated trends and to include provisions for possible unfavorable deviations. Such liabilities are, for some plans, graded to equal statutory values or cash values at or prior to maturity, which are deemed a reasonable equivalent for GAAP. The range of assumed interest rates for all traditional life insurance policy reserves was 4% to 10%. Benefit reserves for traditional limited-payment life insurance policies include the deferred portion of the premiums received during the premium-paying period. Deferred premiums are recognized as income over the life of the policies. Policy benefit claims are charged to expense in the period the claims are incurred. Increases in future policy benefits are charged to expense. Future policy benefit reserves for interest-sensitive insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. Policy benefits and claims that are charged to expense include benefit claims incurred in the period in excess of related policy account balances. Interest crediting rates for interest-sensitive insurance products ranged from 3% to 6.5%. The Company records an unpaid claims liability for claims in the course of settlement equal to the death benefit amount less any reinsurance recoverable amount for claims reported. There is also an unpaid claims liability for claims incurred but not reported. This liability is based on the historical experience of the net amount of claims that were reported in reporting periods subsequent to the reporting period when claims were incurred. Participating Insurance Participating business constituted 2% of insurance in force for the years ended 2020 and 2019. The provision for policyholders’ dividends included in policyholder obligations is based on dividend scales anticipated by management. Amounts to be paid are determined by the Board of Directors. Recognition of Insurance Premiums and Other Considerations Premiums Reinsurance The Company follows the procedure of reinsuring risks in excess of $100,000 to provide for greater diversification of business to allow management to control exposure to potential losses arising from large risks, and provide additional capacity for growth. The Company remains liable for amounts ceded in the event the reinsurers are unable to meet their obligations. The Company entered into coinsurance agreements with unaffiliated insurance companies under which the Company assumed 100% of the risk for certain life insurance policies and certain other policy-related liabilities of the insurance company. Reinsurance premiums, commissions, expense reimbursements, and reserves related to reinsured business are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts. Expense allowances received in connection with reinsurance ceded are accounted for as a reduction of the related policy acquisition costs and are deferred and amortized accordingly. Pre-need Sales and Costs Pre-need contract sales of funeral services and caskets Sales of cemetery interment rights (cemetery burial property) Pre-need contract sales of cemetery merchandise (primarily markers and vaults) Pre-need contract sales of cemetery services (primarily merchandise delivery, installation fees and burial opening and closing fees) Prearranged funeral and pre-need cemetery customer acquisition costs Revenues and costs for at-need sales are recorded when a valid contract exists, the services are performed, collection is reasonably assured and there are no significant obligations remaining. The Company, through its cemetery and mortuary operations, provides guaranteed funeral arrangements wherein a prospective customer can receive future goods and services at guaranteed prices. To accomplish this, the Company, through its life insurance operations, sells to the customer an increasing benefit life insurance policy that is assigned to the mortuaries. If, at the time of need, the policyholder/potential mortuary customer utilizes one of the Company’s facilities, the guaranteed funeral arrangement contract that has been assigned will provide the funeral goods and services at the contracted price. The increasing life insurance policy will cover the difference between the original contract prices and current prices. Risks may arise if the difference cannot be fully met by the life insurance policy. However, management believes that given current inflation rates and related price increases of goods and services, the risk of exposure is minimal. Goodwill Previous acquisitions have been accounted for as purchases under which assets acquired and liabilities assumed were recorded at their fair values with the excess purchase price recognized as goodwill. The Company evaluates annually or when changes in circumstances warrant the recoverability of goodwill and if there is a decrease in value, the related impairment is recognized as a charge against income. No impairment of goodwill has been recognized in the accompanying financial statements. Other Intangibles (trade name and customer lists) Other intangibles are recognized apart from goodwill whenever an acquired intangible asset arises from contractual or other legal rights, or whenever it is capable of being separated or divided from the acquired entity and sold, transferred, licensed, rented, or exchanged, either individually or in combination with a related contract, asset, or liability. The Company engaged a valuation firm to analyze the value of the Kilpatrick Life name in conjunction with its acquisition. The value of the trade name is included in Other Assets and was determined using the income approach, relying on a relief from the royalty method. Income Taxes Income taxes include taxes currently payable plus deferred taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the temporary differences in the financial reporting basis and tax basis of assets and liabilities and operating loss carry-forwards. Def |
2) Investments
2) Investments | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
2) Investments | 2) Investments The Company’s investments as of December 31, 2020 are summarized as follows: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value December 31, 2020 Fixed maturity securities, available for sale, at estimated fair value: U.S. Treasury securities and obligations of U.S. Government agencies $ 42,381,805 $ 1,358,562 $ - $ 43,740,367 Obligations of states and political subdivisions 5,383,762 312,214 (1,261) 5,694,715 Corporate securities including public utilities 186,067,912 27,216,496 (681,478) 212,602,930 Mortgage-backed securities 31,047,791 1,565,377 (267,106) 32,346,062 Redeemable preferred stock 269,214 3,391 - 272,605 Total fixed maturity securities available for sale $ 265,150,484 $ 30,456,040 $ (949,845) $ 294,656,679 Equity securities at estimated fair value: Common stock: Industrial, miscellaneous and all other $ 9,698,490 $ 2,376,156 $ (750,407) $ 11,324,239 Total equity securities at estimated fair value $ 9,698,490 $ 2,376,156 $ (750,407) $ 11,324,239 Mortgage loans held for investment at amortized cost: Residential $ 95,822,448 Residential construction 111,111,777 Commercial 46,836,866 Less: Unamortized deferred loan fees, net (1,161,132) Less: Allowance for loan losses (2,005,127) Less: Net discounts (1,260,896) Total mortgage loans held for investment $ 249,343,936 Real estate held for investment - net of accumulated depreciation: Residential $ 24,843,743 Commercial 106,840,710 Total real estate held for investment $ 131,684,453 Real estate held for sale: Residential $ 3,478,254 Commercial 4,400,553 Total real estate held for sale $ 7,878,807 Other investments and policy loans at amortized cost: Policy loans $ 14,171,589 Insurance assignments 53,231,131 Federal Home Loan Bank stock (1) 2,506,600 Other investments 5,432,816 Less: Allowance for doubtful accounts (1,645,475) Total policy loans and other investments $ 73,696,661 Accrued investment income $ 5,360,523 Total investments $ 773,945,298 (1) Includes $866,900 of Membership stock and $1,639,700 of Activity stock due to short-term borrowings. The Company’s investments as of December 31, 2019 are summarized as follows: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value December 31, 2019 Fixed maturity securities, available for sale, at estimated fair value: U.S. Treasury securities and obligations of U.S. Government agencies $ 142,740,641 $ 632,185 $ (25,215) $ 143,347,611 Obligations of states and political subdivisions 7,450,366 87,812 (9,026) 7,529,152 Corporate securities including public utilities 156,599,184 16,768,449 (463,413) 172,904,220 Mortgage-backed securities 31,475,280 597,395 (240,177) 31,832,498 Redeemable preferred stock 364,339 - - 364,339 Total fixed maturity securities available for sale $ 338,629,810 $ 18,085,841 $ (737,831) $ 355,977,820 Equity securities at estimated fair value: Common stock: Industrial, miscellaneous and all other $ 6,900,537 $ 1,139,799 $ (769,171) $ 7,271,165 Total equity securities at estimated fair value $ 6,900,537 $ 1,139,799 $ (769,171) $ 7,271,165 Mortgage loans held for investment at amortized cost: Residential $ 113,043,965 Residential construction 89,430,237 Commercial 38,718,220 Less: Unamortized deferred loan fees, net (2,391,567) Less: Allowance for loan losses (1,453,037) Less: Net discounts (653,272) Total mortgage loans held for investment $ 236,694,546 Real estate held for investment - net of accumulated depreciation: Residential $ 12,530,306 Commercial 90,226,640 Total real estate held for investment $ 102,756,946 Real estate held for sale: Residential $ 8,021,306 Commercial 6,076,321 Total real estate held for sale $ 14,097,627 Other investments and policy loans at amortized cost: Policy loans $ 14,762,805 Insurance assignments 41,062,965 Federal Home Loan Bank stock (1) 894,300 Other investments 4,973,225 Less: Allowance for doubtful accounts (1,448,026) Total policy loans and other investments $ 60,245,269 Accrued investment income $ 4,833,232 Total investments $ 781,876,605 (1) Includes $894,300 of Membership stock and $-0- of Activity stock due to short-term borrowings. Fixed Maturity Securities On December 31, 2019, the Company changed the classification of its bond and preferred stock investments from held to maturity to available for sale based on the Company’s need to be able to respond proactively to market risks in managing its portfolio. Such investments are carried at fair value with any unrealized gains and losses reported as a component of other accumulated comprehensive income or loss. At the date of the transfer, the carrying value of the Company’s held to maturity securities was $338,629,810, and net unrealized gains of $17,315,770 were recognized in accumulated other comprehensive income. The following tables summarize unrealized losses on fixed maturities securities that were carried at estimated fair value at December 31, 2020 and at December 31, 2019. The unrealized losses were primarily related to interest rate fluctuations and uncertainties relating to COVID-19. The tables set forth unrealized losses by duration with the fair value of the related fixed maturity securities: Unrealized Losses for Less than Twelve Months Fair Value Unrealized Losses for More than Twelve Months Fair Value Total Unrealized Loss Fair Value At December 31, 2020 Obligations of States and Political Subdivisions $ 1,261 $ 206,812 $ - $ - $ 1,261 $ 206,812 Corporate Securities 242,596 9,919,298 438,882 2,593,026 681,478 12,512,324 Mortgage and other asset-backed securities 266,522 3,455,574 584 51,961 267,106 3,507,535 Total unrealized losses $ 510,379 $13,581,684 $ 439,466 2,644,987 $ 949,845 $16,226,671 At December 31, 2019 U.S. Treasury Securities and Obligations of U.S. Government Agencies $ 20,211 $30,629,288 $ 5,004 $10,000,400 $ 25,215 $40,629,688 Obligations of States and Political Subdivisions 9,026 3,062,889 - - 9,026 3,062,889 Corporate Securities 118,746 7,184,311 344,667 3,950,509 463,413 11,134,820 Mortgage and other asset-backed securities 205,470 13,266,443 34,707 502,769 240,177 13,769,212 Total unrealized losses $ 353,453 $54,142,931 $ 384,378 $14,453,678 $ 737,831 $68,596,609 There were 63 securities with fair value of 94.7% of amortized cost at December 31, 2020. There were 93 securities with fair value of 98.9% of amortized cost at December 31, 2019. Credit losses of $370,975 and $-0- have been recognized for the years ended December 31, 2020 and 2019, respectively. On a quarterly basis, the Company evaluates its fixed maturity securities classified as available for sale. This evaluation includes a review of current ratings by the National Association of Insurance Commissions (“NAIC”). Securities with a rating of 1 or 2 are considered investment grade and are not reviewed for impairment. Securities with ratings of 3 to 5 are evaluated for impairment. Securities with a rating of 6 are automatically determined to be impaired and are written down. The evaluation involves an analysis of the securities in relation to historical values, interest payment history, projected earnings and revenue growth rates as well as a review of the reason for a downgrade in the NAIC rating. Based on the analysis of a security that is rated 3 to 5, a determination is made whether the security will likely make interest and principal payments in accordance with the terms of the financial instrument. If it is unlikely that the security will meet contractual obligations, the loss is considered to be other than temporary, the security is written down to the new anticipated market value and an impairment loss is recognized. The fair values of fixed maturity securities are based on quoted market prices, when available. For fixed maturity securities not actively traded, fair values are estimated using values obtained from independent pricing services, or in the case of private placements, are estimated by discounting expected future cash flows using a current market value applicable to the coupon rate, credit and maturity of the investments. The following table presents a rollforward of the Company's cumulative other than temporary credit impairments (“OTTI”) recognized in earnings on fixed maturity securities available for sale for the years ended December 31: 2020 2019 Balance of credit-related OTTI at January 1 $ - $ - Additions for credit impairments recognized on: Securities not previously impaired 370,975 - Securities previously impaired - - Reductions for credit impairments previously recognized on: Securities that matured or were sold during the period (realized) - - Securities due to an increase in expected cash flows - - Balance of credit-related OTTI at December 31 $ 370,975 $ - The amortized cost and estimated fair value of fixed maturity securities available for sale at December 31, 2020, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because certain borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Estimated Fair Cost Value Due in 1 year $ 28,634,042 $ 28,831,983 Due in 2-5 years 66,183,907 70,910,775 Due in 5-10 years 70,162,166 78,592,046 Due in more than 10 years 68,853,364 83,703,208 Mortgage-backed securities 31,047,791 32,346,062 Redeemable preferred stock 269,214 272,605 Total $ 265,150,484 $ 294,656,679 The Company is a member of the Federal Home Loan Bank of Des Moines and Dallas (“FHLB”). The Company pledged a total of $40,000,000, par value, of United States Treasury fixed maturity securities with the FHLB at December 31, 2020. These securities are used as collateral on any cash borrowings from the FHLB. As of December 31, 2020, the Company did not have any outstanding amounts owed to the FHLB and its estimated maximum borrowing capacity was $39,102,336. Investment Related Earnings The Company’s net realized gains and losses from sales, calls, and maturities, unrealized gains and losses on equity securities, and other than temporary impairments from investments and other assets for the years ended December 31 are summarized as follows: 2020 2019 Fixed maturity securities available for sale: Gross realized gains $ 445,749 $ 459,286 Gross realized losses (77,546) (162,649) Other than temporary impairments (370,975) - Equity securities: Gains on securities sold 74,836 256,520 Unrealized gains on securities held at the end of the period 1,125,304 1,086,116 Other assets: Gross realized gains 2,342,418 2,844,673 Gross realized losses (1,984,911) (3,755,579) Total $ 1,554,875 $ 728,367 The net realized gains and losses on the sale of securities are recorded on the trade date, and the cost of the securities sold is determined using the specific identification method. On December 31, 2019, the Company changed the classification of its bond and preferred stock investments from held to maturity to available for sale based on the Company’s need to be able to respond proactively to market risks in managing its portfolio. Proceeds received from the sale of fixed maturity securities Major categories of net investment income for the years ended December 31, were as follows: 2020 2019 Fixed maturity securities available for sale $ 12,233,394 $ 10,372,559 Equity securities 642,433 309,918 Mortgage loans held for investment 25,672,746 18,405,010 Real estate held for investment and sale 11,945,401 8,782,959 Policy loans 1,025,179 554,969 Insurance assignments 17,837,578 16,086,059 Other investments 126,013 184,439 Cash and cash equivalents 426,623 1,824,443 Gross investment income 69,909,367 56,520,356 Investment expenses (13,579,564) (13,500,883) Net investment income $ 56,329,803 $ 43,019,473 Net investment income includes income earned by the restricted assets of the cemeteries and mortuaries of $676,313 and $448,754 for the years ended December 31, 2020 and 2019, respectively. Net investment income on real estate consists primarily of rental revenue. Investment expenses consist primarily of depreciation, property taxes, operating expenses of real estate and an estimated portion of administrative expenses relating to investment activities. Securities on deposit for regulatory authorities as required by law amounted to $9,684,409 and $9,633,818 at December 31, 2020 and 2019, respectively. The restricted securities are included in various assets under investments on the accompanying consolidated balance sheets. There were no investments, aggregated by issuer, in excess of 10% of shareholders’ equity (before net unrealized gains and losses) at December 31, 2020, other than investments issued or guaranteed by the United States Government. Real Estate Held for Investment and Held for Sale The Company continues to strategically deploy resources into real estate to match the income and yield durations of its primary obligations. The sources for these real estate assets come through its various business segments in the form of acquisition, development and mortgage foreclosures. The Company reports real estate held for investment and held for sale pursuant to the accounting policy discussed in Note 1 of the Notes to Consolidated Financial Statements. Commercial Real Estate Held for Investment and Held for Sale The Company owns and manages commercial real estate assets as a means of generating investment income. These assets are acquired in accordance with the Company’s goals and objectives for risk-adjusted returns. Due diligence is conducted on each asset using internal and third-party reports. Geographic locations and asset classes of the investment activity is determined by senior management under the direction of the Board of Directors. The Company employs full-time employees to attend to the day-to-day operations of those assets within the greater Salt Lake area and close surrounding markets. The Company utilizes third-party property managers when the geographic boundary does not warrant full-time staff or through strategic lease-up periods. The Company generally looks to acquire assets in regions that are high growth regions for employment and population and assets that provide operational efficiencies. The Company currently owns and operates 11 commercial properties in 5 states. These properties include office buildings, a funeral home, flex office space, and includes the redevelopment and expansion of its corporate campus (“Center53”) in Salt Lake City, Utah. The Company also holds undeveloped land that may be used for future commercial developments. The Company does use debt in strategic cases to leverage established yields or to acquire a higher quality or different class of asset. See Note 20 regarding commercial real estate held for investment in Louisiana acquired with the acquisition of Kilpatrick Life Insurance Company. The aggregated net ending balance of commercial real estate that serves as collateral for bank loans was $71,517,902 and $87,814,860 as of December 31, 2020 and 2019, respectively. The associated bank loan carrying values totaled $46,153,283 and $54,917,279 as of December 31, 2020 and 2019, respectively. During the years ended December 31, 2020 and 2019, the Company recorded impairment losses on commercial real estate held for sale of $897,980 and $2,768,979, respectively. Impairment losses of $846,980 and of $2,768,979 for the years ended December 31, 2020 and 2019, respectively, relate to an office building located in Kansas held by the life insurance segment. An impairment loss of $51,000 for the year ended December 31, 2020 relates to the improved commercial pad located in Texas held by the life insurance segment. Impairment loss are included in gains (losses) on investments and other assets on the consolidated statements of earnings. The Company’s commercial real estate held for investment for the years ended December 31, is summarized as follows: Net Ending Balance Total Square Footage 2020 2019 2020 2019 Louisiana $ 2,998,684 $ 6,009,079 84,841 125,114 Mississippi 2,914,498 2,951,478 21,521 21,521 Utah (1) 100,927,528 81,266,083 379,066 465,230 $ 106,840,710 $ 90,226,640 485,428 611,865 (1) Includes Center53 phase 1 and phase 2 which is under construction. The Company’s commercial real estate held for sale for the years ended December 31, is summarized as follows: Net Ending Balance Total Square Footage 2020 2019 2020 2019 Arizona (1) $ - $ 2,500 - - Kansas 4,000,000 4,800,000 222,679 222,679 Mississippi 151,553 318,322 12,300 12,300 Nevada - 655,499 - 4,800 Texas (2) 249,000 300,000 - - $ 4,400,553 $ 6,076,321 234,979 239,779 (1) Undeveloped land (2) Improved commercial pad These properties are all actively being marketed with the assistance of commercial real estate brokers in the markets where the properties are located. The Company expects these properties to sell within the coming 12 months. Residential Real Estate Held for Investment and Held for Sale The Company owns a small portfolio of residential homes primarily as a result of loan foreclosures. The Company has the option to sell them or to continue to hold them for cash flow and acceptable returns. The Company also invests in residential subdivision land developments. The Company established Security National Real Estate Services (“SNRE”) to manage the residential portfolio. SNRE cultivates and maintains the preferred vendor relationships necessary to manage costs and quality of work performed on the portfolio of homes across the country. As of December 31, 2020, SNRE manages 11 residential properties in 5 states across the United States. During the years ended December 31, 2020 and 2019, the Company recorded impairment losses on residential real estate held for sale of $43,394 and $700,134, respectively. These impairment losses are included in gains (losses) on investments and other assets on the consolidated statements of earnings. The net ending balance of foreclosed residential real estate included in residential real estate held for investment or sale is $4,327,079 and $12,433,986 as of December 31, 2020 and 2019, respectively. The Company’s residential real estate held for investment for the years ended December 31, is summarized as follows: Net Ending Balance 2020 2019 Florida - 2,487,723 Nevada - 293,516 Utah (1) 24,557,562 9,462,886 Washington (2) 286,181 286,181 $ 24,843,743 $ 12,530,306 (1) Including subdivision land developments (2) Improved residential lots Additional information regarding the Company’s subdivision land developments in Utah for the years ended December 31, is summarized as follows: 2020 2019 Lots available for sale 36 48 Lots to be developed 350 174 Ending Balance (1) $ 23,777,478 $ 7,889,576 (1) The estimated remaining cost to complete the undeveloped lots is $17,354,000 and $1,900,000 as of December 31, 2020 and 2019, respectively. The Company’s residential real estate held for sale for the years ended December 31, is summarized as follows: Net Ending Balance 2020 2019 California - 640,452 Florida 744,322 1,300,641 Nevada 979,640 - Ohio 10,000 10,000 Utah 1,744,292 5,880,213 Washington - 190,000 $ 3,478,254 $ 8,021,306 These properties are all actively being marketed with the assistance of residential real estate brokers in the markets where the properties are located. The Company expects these properties to sell within the coming 12 months. Real Estate Owned and Occupied by the Company The primary business units of the Company occupy a portion of the commercial real estate owned by the Company. As of December 31, 2020, real estate owned and occupied by the Company is summarized as follows: Location Business Segment Approximate Square Footage Square Footage Occupied by the Company 121 W. Election Rd., Draper, UT Corporate Offices, Life Insurance and Cemetery/Mortuary Operations 78,979 18% 5201 Green Street, Salt Lake City, UT (1) Life Insurance and Mortgage Operations 39,157 73% 1044 River Oaks Dr., Flowood, MS Life Insurance Operations 19,694 28% 1818 Marshall Street, Shreveport, LA (1)(2) Life Insurance Operations 12,274 100% 909 Foisy Street, Alexandria, LA (1)(2) Life Insurance Sales 8,059 100% 812 Sheppard Street, Minden, LA (1)(2) Life Insurance Sales 1,560 100% 1550 N 3rd Street, Jena, LA (1)(2) Life Insurance Sales 1,737 100% (1) Included in property and equipment on the consolidated balance sheets (2) See Note 20 regarding the acquisition of Kilpatrick Life Insurance Company Mortgage Loans Held for Investment The Company reports mortgage loans held for investment pursuant to the accounting policy discussed in Note 1 of the Notes to Consolidated Financial Statements. Mortgage loans consist of first and second mortgages. The mortgage loans bear interest at rates ranging from 2.0 % to 10.5%, maturity dates range from nine months to 30 years and are secured by real estate. Concentrations of credit risk arise when a number of mortgage loan debtors have similar economic characteristics that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions. Although the Company has a diversified mortgage loan portfolio consisting of residential mortgages, commercial loans and residential construction loans and requires collateral on all real estate exposures, a substantial portion of its debtors’ ability to honor obligations is reliant on the economic stability of the geographic region in which the debtors do business. At December 31, 2020, the Company had 57%, 13%, 9%, 4%, 3% and 3% of its mortgage loans from borrowers located in the states of Utah, Florida, Texas, California, Nevada and Arizona, respectively. At December 31, 2019, the Company had 48%, 16%, 10%, 6%, 6% and 5% of its mortgage loans from borrowers located in the states of Utah, Florida, Texas, California, Nevada and Arizona, respectively. The Company establishes a valuation allowance for credit losses in its portfolio. The following is a summary of the allowance for loan losses as a contra-asset account for the periods presented: Allowance for Credit Losses and Recorded Investment in Mortgage Loans Held for Investment Years Ended December 31 Commercial Residential Residential Construction Total 2020 Allowance for credit losses: Beginning balance $ 187,129 $ 1,222,706 $ 43,202 $ 1,453,037 Charge-offs - - - - Provision - 552,090 - 552,090 Ending balance $ 187,129 $ 1,774,796 $ 43,202 $ 2,005,127 Ending balance: individually evaluated for impairment $ - $ 219,905 $ - $ 219,905 Ending balance: collectively evaluated for impairment $ 187,129 $ 1,554,891 $ 43,202 $ 1,785,222 Mortgage loans: Ending balance $ 46,836,866 $ 111,111,777 $ 95,822,448 $ 253,771,091 Ending balance: individually evaluated for impairment $ 2,148,827 $ 7,932,680 $ 200,963 $ 10,282,470 Ending balance: collectively evaluated for impairment $ 44,688,039 $ 103,179,097 $ 95,621,485 $ 243,488,621 2019 Allowance for credit losses: Beginning balance $ 187,129 $ 1,125,623 $ 35,220 $ 1,347,972 Charge-offs - (32,692) - (32,692) Provision - 129,775 7,982 137,757 Ending balance $ 187,129 $ 1,222,706 $ 43,202 $ 1,453,037 Ending balance: individually evaluated for impairment $ - $ 195,993 $ - $ 195,993 Ending balance: collectively evaluated for impairment $ 187,129 $ 1,026,713 $ 43,202 $ 1,257,044 Mortgage loans: Ending balance $ 38,718,220 $ 113,043,965 $ 89,430,237 $ 241,192,422 Ending balance: individually evaluated for impairment $ 4,488,719 $ 3,752,207 $ 655,000 $ 8,895,926 Ending balance: collectively evaluated for impairment $ 34,229,501 $ 109,291,758 $ 88,775,237 $ 232,296,496 Age Analysis of Past Due Mortgage Loans Held for Investment Years Ended December 31 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days (1) In Process of Foreclosure (1) Total Past Due Current Total Mortgage Loans Allowance for Loan Losses Unamortized deferred loan fees, net Unamortized discounts, net Net Mortgage Loans 2020 Commercial $ 233,200 $ 812,780 $ 2,148,827 $ - $ 3,194,807 $ 43,642,059 $ 46,836,866 $ (187,129) $ (32,557) $ (880,721) $ 45,736,459 Residential 5,866,505 2,048,148 5,669,583 2,263,097 15,847,333 79,975,115 95,822,448 (1,774,796) (909,864) (380,175) 92,757,613 Residential Construction 127,191 - - 200,963 328,154 110,783,623 111,111,777 (43,202) (218,711) - 110,849,864 Total $ 6,226,896 $ 2,860,928 $ 7,818,410 $ 2,464,060 $ 19,370,294 $ 234,400,797 $ 253,771,091 $ (2,005,127) $ (1,161,132) $ (1,260,896) $ 249,343,936 2019 Commercial $ 1,872,000 $ - $ 4,488,719 $ - $ 6,360,719 $ 32,357,501 $ 38,718,220 $ (187,129) $ (88,918) $ (653,272) $ 37,788,901 Residential 10,609,296 4,085,767 2,100,742 1,651,465 18,447,270 94,596,695 113,043,965 (1,222,706) (1,567,581) - 110,253,678 Residential Construction - - 655,000 - 655,000 88,775,237 89,430,237 (43,202) (735,068) - 88,651,967 Total $ 12,481,296 $ 4,085,767 $ 7,244,461 $ 1,651,465 $ 25,462,989 $ 215,729,433 $ 241,192,422 $ (1,453,037) $ (2,391,567) $ (653,272) $ 236,694,546 (1) There was not any interest income recognized on loans past due greater than 90 days or in foreclosure. The following is a summary of the aging of mortgage loans held for investment for the periods presented. Impaired Mortgage Loans Held for Investment Impaired mortgage loans held for investment include loans with a related specific valuation allowance or loans whose carrying amount has been reduced to the expected collectible amount because the impairment has been considered other than temporary. The recorded investment in and unpaid principal balance of impaired loans along with the related loan specific allowance for losses, if any, for each reporting period and the average recorded investment and interest income recognized during the time the loans were impaired were as follows: Impaired Loans Years Ended December 31 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized 2020 With no related allowance recorded: Commercial $ 2,148,827 $ 2,148,827 $ - $ 1,866,819 $ - Residential 6,415,419 6,415,419 - 5,010,078 - Residential construction 200,963 200,963 - 555,278 - With an allowance recorded: Commercial $ - $ - $ - $ - $ - Residential 1,517,261 1,517,261 219,905 1,182,368 - Residential construction - - - - - Total: Commercial $ 2,148,827 $ 2,148,827 $ - $ 1,866,819 $ - Residential 7,932,680 7,932,680 219,905 6,192,446 - Residential construction 200,963 200,963 - 555,278 - 2019 With no related allowance recorded: Commercial $ 4,488,719 $ 4,488,719 $ - $ 1,499,043 $ - Residential 2,254,189 2,254,189 - 3,367,151 - Residential construction 655,000 655,000 - 1,457,278 - With an allowance recorded: Commercial $ - $ - $ - $ - $ - Residential 1,498,018 1,498,018 195,993 665,270 - Residential construction - - - - - Total: Commercial $ 4,488,719 $ 4,488,719 $ - $ 1,499,043 $ - Residential 3,752,207 3,752,207 195,993 4,032,421 - Residential construction 655,000 655,000 - 1,457,278 - Credit Risk Profile Based on Performance Status The Company’s mortgage loan held for investment portfolio is monitored based on performance of the loans. Monitoring a mortgage loan increases when the loan is delinquent or earlier if there is an indication of impairment. The Company defines non-performing mortgage loans as loans 90 days or greater delinquent or on non-accrual status. The Company’s performing and non-performing mortgage loans held for investment were as follows: Mortgage Loans Held for Investment Credit Exposure Credit Risk Profile Based on Payment Activity Years Ended December 31 Commercial Residential Residential Construction Total 2020 2019 2020 2019 2020 2019 2020 2019 Performing $ 44,688,039 $ 34,229,501 $ 87,889,768 $109,291,758 $ 110,910,814 $ 88,775,237 $ 243,488,621 $ 232,296,496 Non-performing 2,148,827 4,488,719 7,932,680 3,752,207 200,963 655,000 10,282,470 8,895,926 Total $ 46,836,866 $ 38,718,220 $ 95,822,448 $113,043,965 $ 111,111,777 $ 89,430,237 $ 253,771,091 $ 241,192,422 Non-Accrual Mortgage Loans Held for Investment Once a loan is past due 90 days, it is the policy of the Company to end the accrual of interest income on the loan and write off any income that had been accrued. Payments received for loans on a non-accrual status are recognized on a cash basis. Interest income recognized from any payments received for loans on a non-accrual status was immaterial. Accrual of interest resumes if a loan is brought current. Interest not accrued on these loans totals approximately $491,000 and $203,000 as of December 31, 2020 and 2019, respectively. The following is a summary of mortgage loans held for investment on a non-accrual status for the periods presented. Mortgage Loans on Non-accrual Status Years Ended December 31 2020 2019 Commercial $ 2,148,827 $ 4,488,719 Residential 7,932,680 3,752,207 Residential construction 200,963 655,000 Total $ 10,282,470 $ 8,895,926 Principal Amounts Due The amortized cost and contractual payments on mortgage loans held for investment by category as of December 31, 2020 are shown below. Expected principal payments may differ from contractual obligations because certain borrowers may elect to pay off mortgage obligations with or without early payment penalties. Principal Principal Principal Amounts Amounts Amounts Due in Due in Due Total 1 Year 2-5 Years Thereafter Residential $ 95,822,448 $ 11,202,899 $ 17,774,238 $ 66,845,311 Residential Construction 111,111,777 $ 103,391,044 $ 7,720,733 - Commercial 46,836,866 27,111,325 11,101,138 8,624,403 Total $ 253,771,091 $ 141,705,268 $ 36,596,109 $ 75,469,714 |
3) Loans Held For Sale
3) Loans Held For Sale | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
3) Loans Held For Sale | 3) Loans Held for Sale The Company has elected the fair value option for loans held for sale as disclosed in Note 1. Interest income is recorded based on the contractual terms of the loan and in accordance with the Company’s policy on mortgage loans held for investment and is included in mortgage fee income on the consolidated statement of earnings. There are three loans with an aggregate unpaid principal balance of $208,636 that are 90 or more days past due and on a nonaccrual status as of December 31, 2020. See Note 17 of the Notes to Consolidated Financial Statements for additional disclosures regarding loans held for sale. The following is a summary of the aggregate fair value and the aggregate unpaid principal balance of loans held for sale for the periods presented: As of December 31 2020 As of December 31 2019 Aggregate fair value $ 422,772,418 $ 213,457,632 Unpaid principal balance 406,407,323 206,417,122 Unrealized gain 16,365,095 7,040,510 Mortgage Fee Income Mortgage fee income consists of origination fees, processing fees, interest income and certain other income related to the origination and sale of mortgage loans held for sale. Major categories of mortgage fee income for loans held for sale for the years ended December 31, were as follows: 2020 2019 Loan fees $ 43,432,532 $ 28,660,966 Interest income 10,628,581 6,978,930 Secondary gains 231,759,342 93,581,956 Change in fair value of loan commitments 7,637,377 899,417 Change in fair value of loans held for sale 10,413,492 2,498,097 Provision for loan loss reserve (4,938,214) (643,284) Mortgage fee income $ 298,933,110 $ 131,976,082 Loan Loss Reserve When a repurchase demand corresponding to a mortgage loan previously held for sale and sold to a third-party investor is received from a third-party investor, the relevant data is reviewed and captured so that an estimated future loss can be calculated. The key factors that are used in the estimated loss calculation are as follows: (i) lien position, (ii) payment status, (iii) claim type, (iv) unpaid principal balance, (v) interest rate, and (vi) validity of the demand. Other data is captured and is useful for management purposes; the actual estimated loss is generally based on these key factors. The Company conducts its own review upon the receipt of a repurchase demand. In many instances, the Company is able to resolve the issues relating to the repurchase demand by the third-party investor without having to make any payments to the investor. The following is a summary of the loan loss reserve which is included in other liabilities and accrued expenses: December 31 2020 2019 Balance, beginning of period $ 4,046,288 $ 3,604,869 Provision for current loan originations (1) 4,938,214 643,284 Additional provision for loan loss reserve 16,506,030 - Charge-offs, net of recaptured amounts (4,906,914) (201,865) Balance, at December 31 $ 20,583,618 $ 4,046,288 (1) Included in Mortgage fee income The Company maintains reserves for estimated losses on current production volumes. For the year ended December 31, 2020, $4,938,214 in reserves were added at a rate of 8.9 basis points per loan, the equivalent of $890 per $1,000,000 in loans originated. This is an increase over the year ended December 31, 2019, when $643,284 in reserves were added at a rate of 2.5 basis points per loan originated, the equivalent of $250 per $1,000,000 in loans originated. The Company also increased its loan loss reserve for the year ended December 31, 2020 by an additional $16,506,030 to account for changes in estimates specific to settlements of loan losses. . The economic impact of COVID-19 and subsequent government action has increased the potential for losses due to early payoff penalties and potential for losses due to increased delinquency. The unique nature of these current events creates significant difficulty for forecasting potential future losses. The Company will continue to monitor data and economic conditions in order to maintain adequate loss reserves on current production. Thus, the Company believes that the final loan loss reserve as of December 31, 2020, represents its best estimate for adequate loss reserves on loans sold. |
4) Receivables
4) Receivables | 12 Months Ended |
Dec. 31, 2020 | |
Receivables [Abstract] | |
4) Receivables | 4) Receivables Receivables consist of the following: December 31 2020 2019 Trade contracts $ 4,119,988 $ 2,795,471 Receivables from sales agents 2,677,774 2,962,571 Other 5,786,827 5,202,444 Total receivables 12,584,589 10,960,486 Allowance for doubtful accounts (1,685,382) (1,724,156) Net receivables $ 10,899,207 $ 9,236,330 |
5) Value of Business Acquired,
5) Value of Business Acquired, Intangible Assets and Goodwill | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
5) Value of Business Acquired, Intangible Assets and Goodwill | 5) Value of Business Acquired, Intangible Assets and Goodwill Information with regard to value of business acquired was as follows: December 31 2020 2019 Balance at beginning of year $ 9,876,647 $ 5,765,190 Value of business acquired - 4,962,831 (1) Imputed interest at 7% included in earnings 670,565 472,916 Amortization included in earnings (1,457,390) (1,320,456) Shadow amortization included in other (134,573) (3,834) Net amortization (921,398) (851,374) Balance at end of year $ 8,955,249 $ 9,876,647 (1) See Note 20 regarding the acquisition of Kilpatrick Life Insurance Company Presuming no additional acquisitions, net amortization charged to income is expected to approximate $1,019,000, $918,000, $854,000, $784,000, and $707,000 for the years 2021 through 2026 . Actual amortization may vary based on changes in assumptions or experience. As of December 31, 2020, value of business acquired is being amortized over a weighted average life of 6.9 years. The carrying value of the Company’s intangible assets were as follows : December 31 Useful Life 2020 2019 Intangible asset - customer lists 15 years $ 890,000 $ 890,000 Intangible asset - trade name (1) 15 years $ 610,000 $ 610,000 Less accumulated amortization (197,334) (98,222) Balance at end of year $ 1,302,666 $ 1,401,778 (1) See Note 20 regarding the acquisition of Kilpatrick Life Insurance Company Information regarding goodwill by segment was as follows: Life Insurance Cemetery/Mortuary Total Balance at January 1, 2019: Goodwill $ 2,765,570 $ - $ 2,765,570 Accumulated impairment - - - Total goodwill, net 2,765,570 - 2,765,570 Acquisition - 754,018 (1) 754,018 Balance at December 31, 2019: Goodwill 2,765,570 754,018 3,519,588 Accumulated impairment - - - Total goodwill, net 2,765,570 754,018 3,519,588 Acquisition - - - Balance at December 31, 2020: Goodwill 2,765,570 754,018 3,519,588 Accumulated impairment - - - Total goodwill, net $ 2,765,570 $ 754,018 $ 3,519,588 (1) See Note 20 regarding the acquisition of Probst Family Funerals and Cremations and Heber Valley Funeral Home Goodwill of $3,519,588 is not amortized but is tested annually for impairment. The annual impairment tests resulted in no impairment of goodwill for the years ended December 31, 2020 and 2019. |
6) Property and Equipment
6) Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
6) Property and Equipment | 6) Property and Equipment The cost of property and equipment is summarized below: December 31 2020 2019 Land and buildings $ 11,972,802 $ 15,131,301 Furniture and equipment 19,679,682 18,987,984 31,652,484 34,119,285 Less accumulated depreciation (19,179,139) (19,518,891) Total $ 12,473,345 $ 14,600,394 Depreciation expense for the years ended December 31, 2020 and 2019 was $2,078,738 and $1,711,369, respectively. During 2020, the Company demolished a building with a gross building cost of $1,723,000 with its associated accumulated depreciation (net book value of $-0-) and transferred land with a cost of $1,516,700 to real estate held for investment to make way for phase 2 of the redevelopment and expansion of Center53. During 2019, the Company transferred $3,261,259 from real estate held for investment to property and equipment. The transfers are shown as a non cash items on the consolidated statements of cash flows. property and equipment acquired through acquisitions. |
7) Bank and Other Loans Payable
7) Bank and Other Loans Payable | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
7) Bank and Other Loans Payable | 7) Bank and Other Loans Payable Bank and other loans payable are summarized as follows: December 31 2020 2019 2.25% above the monthly LIBOR rate plus 1/16th of the monthly LIBOR rate note payable in $ - $ 2,659,769 4.27% fixed note payable in monthly installments of $53,881 including principal and interest, 633,890 1,238,619 Prime rate note payable in monthly installments of $75,108 including principal and interest, 3,257,113 4,000,000 4.40% fixed note payable in monthly installments of $46,825 including principal and interest, - 7,247,651 4.329% fixed note payable in monthly installments of $9,775 including principal and interest, 1,861,920 1,896,450 2.5% above the monthly LIBOR rate plus 1/16th of the monthly LIBOR rate construction loan 35,091,364 33,811,559 4.7865% fixed interest only note payable in monthly installments, collateralized by real property 9,200,000 9,200,000 1 month LIBOR rate plus 2.1% loan purchase agreement with a warehouse line availability of 116,598,834 88,509,536 1 month LIBOR rate plus 3% loan purchase agreement with a warehouse line availability of 68,766,572 67,537,600 1 month LIBOR rate plus 2.5% loan purchase agreement with a warehouse line availability of 60,715,374 - 1 month LIBOR rate plus 2.5% loan purchase agreement with a warehouse line availability of 317,582 - Other short-term borrowings (1) 1,250,000 1,250,000 Finance lease liabilities 104,951 153,439 Other loans payable 26,768 67,989 Total bank and other loans 297,824,368 217,572,612 Less current installments 284,250,996 192,985,602 Bank and other loans, excluding current installments $ 13,573,372 $ 24,587,010 (1) Revolving Line of Credit Sources of Liquidity Federal Home Loan Bank Membership The Federal Home Loan Banks (“the FHLBs”) are a group of cooperatives that lending institutions use to finance housing and economic development in local communities. The Company is a member of the FHLB based in Des Moines, Iowa and based in Dallas, Texas. As a member of the FHLB, the Company is required to maintain a minimum investment in capital stock of the FHLB and may pledge collateral to the bank for advances of funds to be used in its operations. Federal Home Loan Bank of Des Moines At December 31, 2020, the amount available for borrowings from the FHLB of Des Moines was approximately $39,102,336, compared with $57,727,738 at December 31, 2019. United States Treasury with an estimated fair value of $40,729,400 at December 31, 2020 have been pledged at the FHLB of Des Moines as collateral for current and potential borrowings compared with $59,877,900 at December 31, 2019. At December 31, 2020 and 2019, the Company had no outstanding FHLB borrowings. At December 31, 2020, the Company’s total investment in FHLB stock was $786,300 compared with $806,500 at December 31, 2019. The Company’s decreased investment in FHLB stock was a result of its decrease in short-term FHLB borrowings during 2020. Federal Home Loan Bank of Dallas The membership of the FHLB of Dallas was acquired with the acquisition of Kilpatrick Life Insurance Company. See Note 20 regarding this acquisition. At December 31, 2020, the Company’s total investment in FHLB stock was $1,720,300 compared with $87,800 at December 31, 2019. The Company does not have any collateral pledged at the FHLB of Dallas or any outstanding borrowings. Revolving Lines of Credit The Company has a $2,000,000 revolving line-of-credit with a bank with interest payable at the prime rate minus .75%, secured by the capital stock of Security National Life and maturing September 30, 2021, renewable annually. At December 31, 2020, the Company was contingently liable under a standby letter of credit aggregating $348,183, to be used as collateral to cover any contingency related to additional risk assessments pertaining to the Company's captive insurance program and was contingently liable under standby letters of credit aggregating $1,585,063, to be used as collateral for residential subdivision land developments The standby letters of credit will draw on the line of credit if necessary. The Company does not expect any material losses to result from the issuance of the standby letters of credit. The Company also has a $2,500,000 revolving line-of-credit with a bank with interest payable at the overnight LIBOR rate plus 2.25% maturing September 30, 2021. As of December 31, 2020, there was $1,250,000 outstanding under the revolving line-of-credit. Debt Covenants for Mortgage Warehouse Lines of Credit The Company, through its subsidiary SecurityNational Mortgage, has a $150,000,000 line of credit with Wells Fargo Bank N.A. The agreement charges interest at the 1-Month LIBOR rate plus 2.1% and matures on June 24, 2021. SecurityNational Mortgage is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, the ratio of indebtedness to adjusted tangible net worth, and the liquidity overhead coverage ratio, and a quarterly gross profit of at least $1.00. The Company, through its subsidiary SecurityNational Mortgage, has a line of credit with Texas Capital Bank N.A. This agreement with the bank allows SecurityNational Mortgage to borrow up to $175,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 3% and matures on November 15, 2021. The Company is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, and minimum combined pre-tax income (excluding any changes in the fair value of mortgage servicing rights) of at least $1.00 on a rolling four-quarter basis. The Company through its subsidiary SecurityNational Mortgage, has a line of credit with Comerica Bank. This agreement with the bank allows SecurityNational Mortgage to borrow up to $90,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 2.5% and matures on May 27, 2021. The Company is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, and minimum combined pre-tax income (excluding any changes in the fair value of mortgage servicing rights) of at least $1.00 on a rolling twelve months. The Company, through its subsidiary EverLEND Mortgage, has a line of credit with Texas Capital Bank N.A. This agreement with the bank allows EverLEND Mortgage to borrow up to $5,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 2.5% and matures on August 1, 2021. The Company is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, and minimum combined pre-tax income (excluding any changes in the fair value of mortgage servicing rights) of at least $1.00 on a rolling four-quarter basis. The agreements for warehouse lines include cross default provisions in that a covenant violation under one agreement constitutes a covenant violation under the other agreement. As of December 31, 2020, the Company believes that it was in compliance with all debt covenants. The following tabulation shows the combined maturities of bank and other loans payable: 2021 $ 284,242,327 2022 884,383 2023 926,186 2024 937,315 2025 1,634,157 Thereafter 9,200,000 Total $ 297,824,368 Interest expense in 2020 and 2019 was $8,578,810 and $7,386,688, respectively. Interest paid in 2020 and 2019 was $8,385,270 and $7,284,078, respectively. |
8) Cemetery Perpetual Care Trus
8) Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
8) Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets | 8) Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets State law requires the Company to pay into endowment care trusts a portion of the proceeds from the sale of certain cemetery property interment rights for cemeteries that have established an endowment care trust. These endowment care trusts are defined as variable interest entities pursuant to GAAP. Also, management has determined that the Company is the primary beneficiary of these trusts, as it absorbs both a majority of the losses and returns associated with the trusts. The Company has consolidated cemetery endowment care trust investments with a corresponding amount recorded as Cemetery Perpetual Care Obligation in the accompanying consolidated balance sheets . The components of the cemetery perpetual care investments and obligation are as follows: December 31 2020 2019 Cash and cash equivalents $ 402,913 $ 1,306,740 Fixed maturity securities, available for sale, at estimated fair value 747,767 975,673 Equity securities, at estimated fair value 2,062,303 1,605,451 Commerical mortgage loans held for investment - 524,000 Participating interests in residential construction mortgage loans 1,468,600 - Real estate held for investment 1,731,584 - Note receivables from Cottonwood Mortuary, Singing Hills Cemetery and Memorial Estates eliminated in consolidation - 1,541,120 Total cemetery perpetual care trust investments 6,413,167 5,952,984 Cemetery perpetual care obligation (4,087,704) (3,933,719) Trust investments in excess of trust obligations $ 2,325,463 $ 2,019,265 The Company has also established certain restricted assets to provide for future merchandise and service obligations incurred in connection with its pre-need sales for its cemetery and mortuary segment. Restricted cash also represents escrows held for borrowers and investors under servicing and appraisal agreements relating to mortgage loans, funds held by warehouse banks in accordance with loan purchase agreements and funds held in escrow for certain real estate construction development projects. Additionally, the Company elected to maintain its medical benefit fund without change from the prior year and has included this amount as a component of restricted cash. These restricted cash items are for the Company’s life insurance and mortgage segments. Restricted assets are summarized as follows: December 31 2020 2019 Cash and cash equivalents (1) $ 8,842,744 $ 8,674,214 Fixed maturity securities, available for sale, at estimated fair value 1,473,637 1,008,867 Equity securities, at estimated fair value 2,515,778 1,976,480 Participating interests in mortgage loans held for investment 3,317,877 2,275,756 Total $ 16,150,036 $ 13,935,317 (1) Including cash and cash equivalents of $8,524,999 and $7,170,092 as of December 31, 2020 and 2019, respectively, for the life insurance and mortgage segments. A surplus note receivable in the amount of $4,000,000 at December 31, 2020 and 2019, from Security National Life, was eliminated in consolidation. See Notes 1 and 17 for additional information regarding restricted assets. |
9) Income Taxes
9) Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
9) Income Taxes | 9) Income Taxes The Company’s income tax liability is summarized as follows: December 31 2020 2019 Current $ 2,595,877 $ 1,410,153 Deferred 22,662,923 17,276,819 Total $ 25,258,800 $ 18,686,972 Significant components of the Company’s deferred tax (assets) and liabilities are approximately as follows: December 31 2020 2019 Assets Future policy benefits $ (12,657,045) $ (12,450,229) Loan loss reserve (5,352,942) (1,053,256) Unearned premium (699,011) (760,556) Net operating loss (334,085) (438,420) Deferred compensation (2,833,298) (1,996,865) Deposit obligations (610,041) (619,633) Other (1,269,533) (1,020,718) Less: Valuation allowance 961,920 2,439,394 Total deferred tax assets (22,794,035) (15,900,283) Liabilities Deferred policy acquisition costs 16,430,001 15,536,717 Basis difference in property, equipment and real estate 5,312,787 3,638,512 Value of business acquired 1,880,602 2,074,096 Deferred gains 12,124,226 5,169,104 Trusts 1,064,387 1,064,387 Tax on unrealized appreciation 8,644,955 5,694,286 Total deferred tax liabilities 45,456,958 33,177,102 Net deferred tax liability $ 22,662,923 $ 17,276,819 The valuation allowance relates to differences between recorded deferred tax assets and liabilities and ultimate anticipated realization. The Company has recorded a valuation allowance related to Kilpatrick Life Insurance Company that was acquired in December 2019. The Company paid $11,813,120 and $4,861,318 in income taxes for the years ended December 31, 2020 and 2019, respectively. The Company’s income tax expense is summarized as follows for the years ended December 31: 2020 2019 Current Federal $ 10,678,612 $ 4,404,041 State 2,320,233 504,272 12,998,845 4,908,313 Deferred Federal 2,677,943 (1,551,725) State 176,726 (306,172) 2,854,669 (1,857,897) Total $ 15,853,514 $ 3,050,416 The reconciliation of income tax expense at the U.S. federal statutory rates is as follows: 2020 2019 Computed expense at statutory rate $ 15,004,527 $ 2,928,226 State tax expense, net of federal tax benefit 1,972,598 156,499 Change in valuation allowance (1,477,474) 194,364 Other, net 353,863 (228,673) Income tax expense $ 15,853,514 $ 3,050,416 The Company’s overall effective tax rate for the years ended December 31, 2020 and 2019 was 22.2% and 21.9% respectively. The Company’s effective tax rates differ from the U.S. federal statutory rate of 21% partially due to its provision for state income taxes and a decrease to the valuation allowance related to Kilpatrick Life Insurance Company that decreased the effective income tax rate when compared to the prior year. At December 31, 2020, the Company had no significant unrecognized tax benefits. As of December 31, 2020, the Company does not expect any material changes to the estimated amount of unrecognized tax benefits in the next twelve months. Federal and state income tax returns for 2017 through 2020 are subject to examination by taxing authorities. Net Operating Losses and Tax Credit Carryforwards: Year of Expiration 2021 $ 17,100 2022 - 2023 - 2024 - 2025 - Thereafter up through 2037 1,405,155 $ 1,422,255 |
10) Reinsurance, Commitments an
10) Reinsurance, Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
10) Reinsurance, Commitments and Contingencies | 10) Reinsurance, Commitments and Contingencies Reinsurance The Company follows the procedure of reinsuring risks in excess of a specified limit, which ranged from $25,000 to $100,000 during the years 2020 and 2019. The Company is liable for these amounts in the event such reinsurers are unable to pay their portion of the claims. The Company has also assumed insurance from other companies having insurance in force amounting to approximately $96,000,000 and approximately $99,000,000 at December 31, 2020 and 2019, respectively. Mortgage Loan Loss Settlements Future loan losses can be extremely difficult to estimate. However, the Company believes that its reserve methodology and its current practice of property preservation allow it to estimate potential losses on loans sold. The estimated liability for indemnification losses is included in other liabilities and accrued expenses and, as of December 31, 2020 and 2019, the balances were $20,584,000 and $4,046,000, respectively. T he Company believes that the final loan loss reserve as of December 31, 2020, represents its best estimate for adequate loss reserves on loans sold. Mortgage Loan Loss Litigation Settlement Agreement and Mutual Release with Lehman Brothers Holdings Inc. From 2004 to early 2008, SecurityNational Mortgage Company (“SecurityNational Mortgage”), a wholly owned subsidiary of the Company, originated “limited documentation” or “reduced documentation” loans which were sold to certain affiliates of Lehman Brothers Holdings Inc. (“Lehman Holdings”). Certain of these loans became the subject of disputes between SecurityNational Mortgage and Lehman Holdings and certain Lehman Holdings affiliates. Lehman Holdings filed a Petition for Relief under Chapter 11 of the United States Bankruptcy Code in 2008. In May of 2011, SecurityNational Mortgage filed a complaint in U.S. District Court against certain Lehman Holdings affiliates. In June of 2011, Lehman Holdings filed a complaint in Federal District Court against SecurityNational Mortgage, both of which were later resolved. In 2016, certain other pending loan disputes between SecurityNational Mortgage and Lehman Holdings became the subject of an unsuccessful, non-binding alternate dispute resolution mediation proceeding. Thereafter, in 2016, Lehman Holdings filed an adversary proceeding complaint against approximately 150 mortgage loan originators, including SecurityNational Mortgage, in the U.S. Bankruptcy Court of the Southern District of New York, which included seeking damages relating to the alleged obligations of the defendants under indemnification provisions of alleged agreements, in amounts to be determined at trial, including interest, attorneys’ fees and costs incurred by Lehman Holdings in enforcing the obligations of the defendants. The complaint was later amended with the latest amended complaint filed against SecurityNational Mortgage on December 27, 2016, seeking damages to be determined at trial, including interest, attorneys’ fees and costs. This complaint involved approximately 135 mortgage loans, there being millions of dollars allegedly in dispute. These claims against SecurityNational Mortgage were asserted as a result of Lehman Holdings’ earlier settlements with the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Corporation (“Freddie Mac”). In 2018, Lehman Holdings filed a separate adversary proceeding complaint against SecurityNational Mortgage. This adversary proceeding allegedly involved approximately 577 mortgage loans relative to private securitization trusts (“RMBS Loans”) and millions of dollars in damages. Thereafter, Lehman Holdings made a filing that effectively reduced the number of RMBS Loans to 248. This proceeding was in addition to the above-referenced proceeding involving the Fannie Mae and Freddie Mac mortgage loans. As with the above-referenced proceeding, damages were sought including interest, costs, and attorneys’ fees. SecurityNational Mortgage, as well as other defendants, have been involved in written discovery, and production of documents relative to the cases, and the filing of motions. The deposition phase of the cases was yet to begin, as well as the later expert witness phase. Those phases would require substantial expenditures of legal fees and costs. On February 1, 2021, SecurityNational Mortgage executed a settlement agreement with Lehman Holdings in relation to these two adversary proceedings wherein all mortgage loan related claims were resolved, thereby ending all liabilities asserted by Lehman Holdings and conclusively ending all proceedings between SecurityNational Mortgage and Lehman Holdings. In accordance with GAAP, the full amount of SecurityNational Mortgage’s settlement payment has been accounted for in the Company’s loan loss reserve as of December 31, 2020. Non-Cancelable Leases The Company leases office space and equipment under various non-cancelable agreements. See Note 24 regarding leases. Other Contingencies and Commitments The Company has entered into commitments to fund construction and land development loans and has also provided financing for land acquisition and development. As of December 31, 2020, the Company’s commitments were approximately $185,751,000, for these loans of which $115,898,000 had been funded. The Company advances funds once the work has been completed and an independent inspection is made. The maximum loan commitment ranges between 50% and 80% of appraised value. The Company receives fees and interest for these loans and the interest rate is generally fixed 5.50% to 8.00% per annum. Maturities range between six and eighteen months. The Company belongs to a captive insurance group for certain casualty insurance, worker compensation and liability programs. Insurance reserves are maintained relative to these programs. The level of exposure from catastrophic events is limited by the purchase of stop-loss and aggregate liability reinsurance coverage. When estimating the insurance liabilities and related reserves, the captive insurance management considers a number of factors, which include historical claims experience, demographic factors, severity factors and valuations provided by independent third-party actuaries. If actual claims or adverse development of loss reserves occurs and exceed these estimates, additional reserves may be required. The estimation process contains uncertainty since captive insurance management must use judgment to estimate the ultimate cost that will be incurred to settle reported claims and unreported claims for incidents incurred but not reported as of the balance sheet date. The Company is a defendant in various other legal actions arising from the normal conduct of business. Management believes that none of the actions will have a material effect on the Company’s financial position or results of operations. Based on management’s assessment and legal counsel’s representations concerning the likelihood of unfavorable outcomes, no amounts have been accrued for the above claims in the consolidated financial statements. The Company is not a party to any other material legal proceedings outside the ordinary course of business or to any other legal proceedings, which, if adversely determined, would have a material adverse effect on its financial condition or results of operations. |
11) Retirement Plans
11) Retirement Plans | 12 Months Ended |
Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |
11) Retirement Plans | 11) Retirement Plans The Company and its subsidiaries have a noncontributory Employee Stock Ownership Plan (“ESOP”) for all eligible employees. Eligible employees are primarily those with more than one year of service, who work in excess of 1,000 hours per year. Contributions, which may be in cash or stock of the Company, are determined annually by the Board of Directors. The Company’s contributions are allocated to eligible employees based on the ra tio of each eligible employee’s compensation to total compensation for all eligible employees during each year. th distribution election. The Company At December 31, 2020, the ESOP held 231,312 shares of Class A and 118,880 shares of Class C common stock of the Company. All shares held by the ESOP have been allocated to the participating employees and all shares held by the ESOP are considered outstanding for purposes of computing earnings per share. The Company has three 401(k) savings plans covering all eligible employees, as defined above, which includes employer participation in accordance with the provisions of Section 401(k) of the Internal Revenue Code. The plans allow participants to make pretax contributions up to a maximum of $19,500 and $19,000 for the years 2020 and 2019, respectively or the statutory limits. In 2001, the Company’s Board of Directors adopted a Non-Qualified Deferred Compensation Plan, and this plan was amended in 2005. Under the terms of the Plan, the Company will provide deferred compensation for a select group of management or highly compensated employees, within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of the Employee Retirement Income Security Act of 1974, as amended. The Board has appointed a Committee of the Company to be the Plan Administrator and to determine the employees who are eligible to participate in the plan. The employees who participate may elect to defer a portion of their compensation into the plan. The Company may contribute into the plan at the discretion of the Company’s Board of Directors. The Company did not make any contributions for 2020 and 2019. Effective December 4, 2018, the Board members approved a motion to extend the Chief Executive Officer’s employment agreement, dated December 4, 2012, for an additional four-year term ending December 2022. In the event of disability, the Chief Executive Officer’s salary would be continued for up to five years at 75% of its current level of compensation. In the event of a sale or merger of the Company and the Chief Executive Officer is not retained in his current position, the Company would be obligated to continue paying the Chief Executive Officer’s current compensation and benefits for seven years following the merger or sale. The agreement further provides that the Chief Executive Officer is entitled to receive annual retirement benefits beginning (i) one month from the date of his retirement (to commence no sooner than age 65), (ii) five years following complete disability, or (iii) upon termination of his employment without cause. These retirement benefits are to be paid for a period of twenty years in annual installments in the amount equal to 75% of his then current level of compensation. In the event that the Chief Executive Officer dies prior to receiving all retirement benefits thereunder, the remaining benefits are to be paid to his heirs. The Company expensed $900,000 and $660,000 during the years ended December 31, 2020 and 2019, respectively, to cover the present value of anticipated retirement benefits under the employment agreement. The liability accrued was $6,656,363 and $5,722,837 as of December 31, 2020 and 2019, respectively. The Company, through its wholly owned subsidiary, SecurityNational Mortgage, also has an employment agreement with its former Vice President of Mortgage Operations and President of SecurityNational Mortgage, who retired from the Company on December 31, 2015. Under the terms of the employment agreement, this individual is entitled to receive retirement benefits from the Company for a period of ten years in an amount equal to 50% of his rate of compensation at the time of his retirement, which was $267,685 for the year ended December 31, 2015. Such retirement payments are paid monthly during the ten-year period. In the event that this individual dies prior to receiving all of his retirement benefits under his employment agreement, the remaining benefits will be made to his heirs. The company paid $133,843 and $133,843 in retirement compensation to this individual during the years ended December 31, 2020 and 2019, respectively. The liability accrued was $669,212 and $803,055 as of December 31, 2020 and 2019, respectively and is included in Other liabilities and accrued expenses on the consolidated balance sheets. |
12) Capital Stock
12) Capital Stock | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
12) Capital Stock | 12) Capital Stock The Company has one class of preferred stock of $1.00 par value, 5,000,000 shares authorized, of which none are issued. The preferred stock is non-voting. The Company has two classes of common stock with shares outstanding, Class A common shares and Class C common shares. Class C shares have 10 votes per share on all matters except for the election of one third of the directors who are elected solely by the Class A shares. Class C shares are convertible into Class A shares at any time on a one to one ratio. The decrease in treasury stock was the result of treasury stock being used to fund the company’s 401(k) Plans. Stockholders of both Class A and Class C common stock have received 5% stock dividends in the years 1990 through 2019, and a 7.5% stock dividend in the year 2020, as authorized by the Company’s Board of Directors. The Company has Class B common stock of $1.00 par value, 5,000,000 shares authorized, of which none are issued. Class B shares are non-voting stock except to any proposed amendment to the Articles of Incorporation which would affect Class B common stock. The following table summarizes the activity in shares of capital stock for the two-year period ended December 31, 2020: Class A Class C Outstanding shares at December 31, 2018 15,304,798 2,193,643 Exercise of stock options 32,517 191,443 Stock dividends 767,178 119,087 Conversion of Class C to Class A 3,286 (3,286) Outstanding shares at December 31, 2019 16,107,779 2,500,887 Exercise of stock options 68,970 130,820 Stock dividends 405,210 61,720 Conversion of Class C to Class A 13,824 (13,824) Outstanding shares at December 31, 2020 16,595,783 2,679,603 Earnings per share amounts have been retroactively adjusted for the effect of annual stock dividends. In accordance with GAAP, the basic and diluted earnings per share amounts were calculated as follows: 2020 2019 Numerator: Net earnings $ 55,596,613 $ 10,893,519 Denominator: Denominator for basic earnings per share-weighted-average shares 18,831,991 18,562,056 Effect of dilutive securities Employee stock options 443,260 127,608 Dilutive potential common shares 443,260 127,608 Denominator for diluted earnings per share-adjusted weighted-average shares and assumed conversions 19,275,251 18,689,664 Basic earnings per share $2.95 $0.59 Diluted earnings per share $2.88 $0.58 For the years ended December 31, 2020 and 2019, there were -0- and 382,289 of anti-dilutive employee stock option shares, respectively, that were not included in the computation of diluted net earnings per common share as their effect would be anti-dilutive. |
13) Stock Compensation Plans
13) Stock Compensation Plans | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
13) Stock-based Compensation | 13) Stock Compensation Plans The Company has two fixed option plans (the “2013 Plan” and the “2014 Director Plan”). Compensation expense for options issued of $358,878 and $256,996 has been recognized under these plans for the years ended December 31, 2020 and 2019, respectively, and is included in personnel expenses on the consolidated statements of earnings. As of December 31, 2020, the total unrecognized compensation expense related to the options issued was $39,152, which is expected to be recognized over the vesting period of one year. The fair value of each option granted is estimated on the date of grant using the Black Scholes Option Pricing Model. The Company estimates the expected life of the options using the simplified method. Future volatility is estimated based upon the weighted historical volatility of the Company’s Class A common stock over a period equal to the expected life of the options. The risk-free interest rate for the expected life of the options is based upon the Federal Reserve Board’s daily interest rates in effect at the time of the grant. The following table summarizes the assumptions used in estimating the fair value of each option granted along with the weighted-average fair value of the options granted: Assumptions Grant Date Plan Weighted-Average Fair Value of Each Option Expected Dividend Yield Underlying stock FMV Weighted-Average Volatility Weighted-Average Risk-Free Interest Rate Weighted-Average Expected Life (years) March 27, 2020 All Plans $ 0.65 5% $ 3.76 32.29% 1.64% 4.82 December 6, 2019 All Plans $ 0.96 5% $ 5.19 32.79% 1.64% 4.83 January 17, 2019 All Plans $ 1.12 5% $ 4.98 36.04% 2.56% 5.31 Activity of the stock option plans is summarized as follows: Number of Weighted Average Exercise Price Number of Weighted Average Exercise Price Outstanding at January 1, 2019 1,011,274 $ 4.49 577,280 $ 5.15 Adjustment for the effect of stock dividends 51,018 28,295 Granted 81,000 180,000 Exercised (45,834) (191,443) Cancelled (11,405) - Outstanding at December 31, 2019 1,086,053 $ 4.41 594,132 $ 5.36 Adjustment for the effect of stock dividends 27,968 19,354 Granted 77,000 180,000 Exercised (116,487) (130,820) Cancelled (1,671) - Outstanding at December 31, 2020 1,072,863 $ 4.33 662,666 $ 4.73 Exercisable at end of year 1,053,903 $ 4.45 616,542 $ 4.91 Available options for future grant 325,372 266,500 Weighted average contractual term of options outstanding at December 31, 2020 5.50 years 6.71 years Weighted average contractual term of options exercisable at December 31, 2020 5.43 years 6.63 years Aggregated intrinsic value of options outstanding at December 31, 2020 (1) $4,311,983 $2,396,954 Aggregated intrinsic value of options exercisable at December 31, 2020 (1) $4,223,251 $2,183,399 (1) The Company used a stock price of $8.35 as of December 31, 2020 to derive intrinsic value. The total intrinsic value (which is the amount by which the fair value of the underlying stock exceeds the exercise price of an option on the exercise date) of stock options exercised during the years ended December 31, 2020 and 2019 was $663,901 and $271,220, respectively. |
14) Statutory Financial Informa
14) Statutory Financial Information and Dividend Limitations | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
14) Statutory Financial Information and Dividend Limitations | 14) Statutory Financial Information and Dividend Limitations The Company’s insurance subsidiaries prepare their statutory-basis financial statements in conformity with accounting practices prescribed or permitted by the insurance department of the applicable state of domicile. Prescribed statutory accounting practices include a variety of publications of the NAIC, as well as state laws, regulations and general administrative rules. Permitted statutory accounting practices encompass all accounting practices not so prescribed. All states require domiciled insurance companies to prepare statutory-basis financial statements in conformity with the NAIC Accounting Practices and Procedures Manual, subject to any deviations prescribed or permitted by the applicable insurance commissioner and/or director. Statutory accounting practices differ from GAAP primarily since they require charging policy acquisition and certain sales inducement costs to expense as incurred, establishing life insurance reserves based on different actuarial assumptions, and valuing certain investments and establishing deferred taxes on a different basis. Statutory net income and capital and surplus of the Company’s insurance subsidiaries, determined in accordance with statutory accounting practices prescribed or permitted by insurance regulatory authorities are as follows: Statutory Net Income Statutory Capital and Surplus 2020 2019 2020 2019 Amounts by insurance subsidiary: Security National Life Insurance Company $ 6,054,764 $ 3,589,552 $ 53,089,185 $ 49,390,181 Kilpatrick Life Insurance Company 1,574,128 12,752,100 (1) 15,177,996 15,208,071 First Guaranty Insurance Company 790,221 1,078,733 7,045,644 6,352,670 Memorial Insurance Company of America 55 (107) 1,088,034 1,088,559 Southern Security Life Insurance Company, Inc. 183 87 1,581,647 1,588,396 Trans-Western Life Insurance Company (1,527) 3,773 510,636 512,163 Total $ 8,417,824 $17,424,138 $ 78,493,142 $ 74,140,040 (1) Includes 12 months even though Kilpatrick Life Insurance Company wasn't acquired by the Company until December 2019. The Utah, Arkansas, Louisiana, Mississippi and Texas Insurance Departments impose minimum risk-based capital (RBC) requirements that were developed by the NAIC on insurance enterprises. The formulas for determining the RBC specify various factors that are applied to financial balances or various levels of activity based on the perceived degree of risk. Regulatory compliance is determined by a ratio (the Ratio) of the enterprise’s regulatory total adjusted capital, as defined by the NAIC, to its authorized control level, as defined by the NAIC. Enterprises below specific trigger points or ratios are classified within certain levels, each of which requires specified corrective action. The life insurance subsidiaries each have a ratio that is greater than the first level of regulatory action as of December 31, 2020. Generally, the net assets of the life insurance subsidiaries available for transfer to the Company are limited to the amounts of the life insurance subsidiaries net assets, as determined in accordance with statutory accounting practices, that exceed minimum statutory capital requirements. Additional requirements must be met depending on the state, and payments of such amounts as dividends are subject to approval by regulatory authorities. Under the Utah Insurance Code, Security National Life Insurance Company is permitted to pay a stockholder dividend to the Company as long as the Company provides the Utah Insurance Commissioner (the “Utah Commissioner”) with at least 30 days notice and the aggregate amount of all such dividends in any 12 month period does not exceed the lesser of: (i) 10% of its surplus to policyholders as of the end of the immediately preceding calendar year, or (ii) net gain from operations, not including realized capital gains, for the immediately preceding calendar year, not including Under the Louisiana Insurance Code, First Guaranty Insurance Company and Kilpatrick Life Insurance Company are permitted to pay a stockholder dividend to Security National Life as long as their capital has been (i) fully paid in cash, (ii) is unimpaired, (iii) has a surplus beyond its capital stock and (iv) has a surplus beyond its minimum required surplus. In 2019, First Guaranty Insurance Company paid to Security National Life a cash dividend of $500,000 and Kilpatrick Life Insurance Company paid a cash dividend of $3,000,000. Amounts available to be paid as dividends at December 31, 2020 totaled approximately $3,146,000 for First Guaranty Insurance Company and totaled approximately $11,478,000 for Kilpatrick Life Insurance Company. |
15) Business Segment Informatio
15) Business Segment Information | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
15) Business Segment Information | 15) Business Segment Information Description of Products and Services by Segment The Company has three reportable business segments: life insurance, cemetery and mortuary, and mortgage. The Company’s life insurance segment consists of life insurance premiums and operating expenses from the sale of insurance products sold by the Company’s independent agency force and net investment income derived from investing policyholder and segment surplus funds. The Company’s cemetery and mortuary segment consists of revenues and operating expenses from the sale of at-need cemetery and mortuary merchandise and services at its mortuaries and cemeteries, pre-need sales of cemetery spaces after collection of 10% or more of the purchase price and the net investment income from investing segment surplus funds. The Company’s mortgage segment consists of fee income and expenses from the originations of residential mortgage loans and interest earned and interest expenses from warehousing pre-sold loans before the funds are received from financial institutional investors. Measurement of Segment Profit or Loss and Segment Assets The accounting policies of the reportable segments are the same as those described in the Significant Accounting Principles. Intersegment revenues are recorded at cost plus an agreed upon intercompany profit, and are eliminated upon consolidation. Factors Management Used to Identify the Enterprise’s Reportable Segments The Company’s reportable segments are business units that are managed separately due to the different products provided and the need to report separately to the various regulatory jurisdictions. The Company regularly reviews the quantitative thresholds and other criteria to determine when other business segments may need to be reported. 2020 Life Cemetery/ Intercompany Insurance Mortuary Mortgage Eliminations Consolidated Revenues: From external sources: Revenue from customers $ 93,020,617 $ 20,307,435 $ 298,933,110 $ - $ 412,261,162 Net investment income 54,811,486 807,695 710,622 - 56,329,803 Gains on investments and other assets 2,088,541 (162,652) (39) - 1,925,850 Other than temporary impairments (370,975) - - - (370,975) Other revenues 1,491,585 94,349 9,731,548 - 11,317,482 Intersegment revenues: Net investment income 8,022,503 351,505 716,240 (9,090,248) - Total revenues 159,063,757 21,398,332 310,091,481 (9,090,248) 481,463,322 Expenses: Death, surrenders and other policy benefits 62,841,360 - - - 62,841,360 Increase in future policy benefits 23,568,650 - - - 23,568,650 Amortization of deferred policy and pre-need acquisition costs and value of business acquired 13,618,204 689,221 - - 14,307,425 Selling, general and administrative expenses: Commissions 4,149,241 1,506,320 118,770,736 - 124,426,297 Personnel 25,449,100 5,669,367 53,871,504 - 84,989,971 Advertising 614,114 391,836 4,374,946 - 5,380,896 Rent and rent related 861,602 89,253 5,922,706 - 6,873,561 Depreciation on property and equipment 843,335 488,570 746,833 - 2,078,738 Provision for loan loss reserve - - 16,506,030 - 16,506,030 Cost related to funding mortgage loans - - 9,877,700 - 9,877,700 Intersegment 621,161 142,999 580,976 (1,345,136) - Other 11,808,818 4,417,805 31,104,479 - 47,331,102 Interest expense: Intersegment 410,024 152,175 7,182,913 (7,745,112) - Other 2,354,760 198,968 6,025,082 - 8,578,810 Costs of goods and services sold-mortuaries and cemeteries - 3,252,655 - - 3,252,655 Total benefits and expenses 147,140,369 16,999,169 254,963,905 (9,090,248) 410,013,195 Earnings before income taxes $ 11,923,388 $ 4,399,163 $ 55,127,576 $ - $ 71,450,127 Income tax benefit (expense) (1,433,901) (1,009,137) (13,410,476) - (15,853,514) Net earnings $ 10,489,487 $ 3,390,026 $ 41,717,100 $ - $ 55,596,613 Identifiable assets $ 1,171,158,235 $ 56,335,498 $ 408,325,196 $ (90,398,039) $ 1,545,420,890 Goodwill $ 2,765,570 $ 754,018 $ - $ - $ 3,519,588 2019 Life Cemetery/ Intercompany Insurance Mortuary Mortgage Eliminations Consolidated Revenues: From external sources: Revenue from customers $ 81,860,610 $ 15,296,235 $ 131,976,082 $ - $ 229,132,927 Net investment income 41,610,831 579,995 828,647 - 43,019,473 Gains on investments and other assets 138,330 530,098 59,939 - 728,367 Other revenues 2,128,961 95,197 7,956,005 - 10,180,163 Intersegment revenues: Net investment income 4,455,034 443,548 508,637 (5,407,219) - Total revenues 130,193,766 16,945,073 141,329,310 (5,407,219) 283,060,930 Expenses: Death, surrenders and other policy benefits 44,911,805 - - - 44,911,805 Increase in future policy benefits 23,568,497 - - - 23,568,497 Amortization of deferred policy and pre-need acquisition costs and value of business acquired 14,199,152 435,425 - - 14,634,577 Selling, general and administrative expenses: Commissions 3,632,780 1,084,079 52,046,032 - 56,762,891 Personnel 20,311,591 5,177,810 38,731,869 - 64,221,270 Advertising 595,118 368,173 3,821,267 - 4,784,558 Rent and rent related 451,380 47,525 6,556,551 - 7,055,456 Depreciation on property and equipment 477,247 428,633 805,489 - 1,711,369 Cost related to funding mortgage loans - - 6,278,954 - 6,278,954 Intersegment 412,853 180,594 544,463 (1,137,910) - Other 11,769,097 3,241,023 19,912,641 - 34,922,761 Interest expense: Intersegment 490,756 154,615 3,623,938 (4,269,309) - Other 2,808,081 288,768 4,289,839 - 7,386,688 Costs of goods and services sold-mortuaries and cemeteries - 2,878,169 - - 2,878,169 Total benefits and expenses 123,628,357 14,284,814 136,611,043 (5,407,219) 269,116,995 Earnings before income taxes $ 6,565,409 $ 2,660,259 $ 4,718,267 $ - $ 13,943,935 Income tax benefit (expense) (1,085,848) (649,144) (1,315,424) - (3,050,416) Net earnings $ 5,479,561 $ 2,011,115 $ 3,402,843 $ - $ 10,893,519 Identifiable assets $ 1,110,641,526 $ 81,014,182 $ 249,970,323 $ (110,701,544) $ 1,330,924,487 Goodwill $ 2,765,570 $ 754,018 $ - $ - $ 3,519,588 |
16) Related Party Transactions
16) Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
16) Related Party Transactions | 16) Related Party Transactions The Company’s Board of Directors has a written procedure, which requires disclosure to the Board of any material |
17) Fair Value of Financial Ins
17) Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
17) Fair Value of Financial Instruments | 17) Fair Value of Financial Instruments GAAP defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. GAAP also specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions. Fair value measurements are classified under the following hierarchy: Level 1: Level 2: a) Quoted prices for similar assets or liabilities in active markets; b) Quoted prices for identical or similar assets or liabilities in non-active markets; or c) Valuation models whose inputs are observable, directly or indirectly, for substantially the full term of the asset or liability. Level 3: The Company utilizes a combination of third-party valuation service providers, brokers, and internal valuation models to determine fair value. The following methods and assumptions were used by the Company in estimating the fair value disclosures related to significant financial instruments: The items shown under Level 1 and Level 2 are valued as follows: Fixed Maturity Securities Available for Sale Equity Securities Loans Held for Sale Restricted Assets Cemetery Perpetual Care Trust Investments Call and Put Options Additionally, there were no transfers between Level 1 and Level 2 in the fair value hierarchy. The items shown under Level 3 are valued as follows: Loan Commitments and Forward Sale Commitments The Company estimates the fair value of a loan commitment based on the change in estimated fair value of the underlying mortgage loan, quoted MBS prices, estimates of the fair value of mortgage servicing rights, and an estimate of the probability that the mortgage loan will fund within the terms of the commitment. The change in fair value of the underlying mortgage loan is measured from the date the loan commitment is issued. Following issuance, the value of a mortgage loan commitment can be either positive or negative depending upon the change in value of the underlying mortgage loans. Fallout rates and other factors from the Company’s recent historical data are used to estimate the quantity and value of mortgage loans that will fund within the terms of the commitments. Impaired Mortgage Loans Held for Investment Impaired Real Estate Held for Investment It should be noted that for replacement cost, when determining the fair value of real estate held for investment, the Company uses a provider of building cost information to the real estate construction industry. For the investment analysis, the Company used market data based upon its real estate operation experience and projected the present value of the net rental income over seven years. The Company also considers area comparables and property condition when determining fair value. In addition to this analysis performed by the Company, the Company depreciates Real Estate Held for Investment. This depreciation reduces the book value of these properties and lessens the exposure to the Company from further deterioration in real estate values. Mortgage Servicing Rights The following table summarizes Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a recurring basis by their classification in the consolidated balance sheet at December 31, 2020. Total Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Assets accounted for at fair value on a Fixed maturity securities available for sale $ 294,656,679 $ - $ 292,455,504 $ 2,201,175 Equity securities 11,324,239 11,324,239 - - Loans held for sale 422,772,418 - - 422,772,418 Restricted assets (1) 1,473,637 - 1,473,637 - Restricted assets (2) 2,515,778 2,515,778 - - Cemetery perpetual care trust investments (1) 747,767 - 747,767 - Cemetery perpetual care trust investments (2) 2,062,303 2,062,303 - - Derivatives - loan commitments (3) 12,592,672 - - 12,592,672 Total assets accounted for at fair value on a $ 748,145,493 $ 15,902,320 $ 294,676,908 $ 437,566,265 Liabilities accounted for at fair value on a Derivatives - call options (4) $ (43,097) $ (43,097) $ - $ - Derivatives - loan commitments (4) (2,464,062) - - (2,464,062) Total liabilities accounted for at fair value $ (2,507,159) $ (43,097) $ - $ (2,464,062) (1) Fixed maturity securities available for sale (2) Equity securities (3) Included in other assets on the consolidated balance sheets (4) Included in other liabilities and accrued expenses on the consolidated balance sheets The following table summarizes Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a recurring basis by their classification in the consolidated balance sheet at December 31, 2019. Total Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Assets accounted for at fair value on a Fixed maturity securities available for sale $ 355,977,820 $ - $ 352,761,438 $ 3,216,382 Equity securities 7,271,165 7,271,165 - - Loans held for sale 213,457,632 - - 213,457,632 Restricted assets (1) 1,008,867 - 1,008,867 - Restricted assets (2) 1,976,480 1,976,480 - - Cemetery perpetual care trust investments (1) 975,673 - 975,673 - Cemetery perpetual care trust investments (2) 1,605,451 1,605,451 - - Derivatives - loan commitments (3) 2,722,580 - - 2,722,580 Total assets accounted for at fair value on a $ 584,995,668 $ 10,853,096 $ 354,745,978 $ 219,396,594 Liabilities accounted for at fair value on a Derivatives - call options (4) $ (62,265) $ (62,265) $ - $ - Derivatives - put options (4) (22,282) (22,282) - - Derivatives - loan commitments (4) (231,347) - - (231,347) Total liabilities accounted for at fair value $ (315,894) $ (84,547) $ - $ (231,347) (1) Fixed maturity securities available for sale (2) Mutual funds and equity securities (3) Included in other assets on the consolidated balance sheets (4) Included in other liabilities and accrued expenses on the consolidated balance sheets For Level 3 assets and liabilities measured at fair value on a recurring basis as of December 31, 2020, the significant unobservable inputs used in the fair value measurements were as follows: Significant Range of Inputs Fair Value at Valuation Unobservable Minimum Maximum Weighted 12/31/2020 Technique Input(s) Value Value Average Loans held for sale $422,772,418 Market approach Investor contract pricing as a percentage of unpaid principal balance 99.0% 110.0% 104.0% Derivatives - loan commitments (net) 10,128,610 Market approach Pull-through rate 52.0% 92.0% 81.0% Initial-Value N/A N/A N/A Servicing 0 bps 184 bps 58 bps Fixed maturity securities available for sale 2,201,175 Broker quotes Pricing quotes $ 90.83 $ 119.33 $ 113.47 For Level 3 assets and liabilities measured at fair value on a recurring basis as of December 31, 2019, the significant unobservable inputs used in the fair value measurements were as follows: Significant Range of Inputs Fair Value at Valuation Unobservable Minimum Maximum Weighted 12/31/2019 Technique Input(s) Value Value Average Loans held for sale $213,457,632 Market approach Investor contract pricing as a percentage of unpaid principal balance 98.0% 109.0% 103.0% Derivatives - loan commitments (net) 2,491,233 Market approach Pull-through rate 1.0% 92.0% 81.0% Initial-Value N/A N/A N/A Servicing 0 bps 318 bps 79 bps Fixed maturity securities available for sale 3,216,382 Broker quotes Pricing quotes $ 95.02 $ 115.80 $ 107.98 Following is a summary of changes in the consolidated balance sheet line items measured using level 3 inputs: Net Derivatives Loan Commitments Loans Held for Sale Fixed Maturity Securities Available for Sale Balance - December 31, 2019 $ 2,491,233 $ 213,457,632 $ 3,216,382 Originations/purchases - 5,627,013,749 - Sales, maturities and paydowns - (5,600,045,285) (1,042,400) Transfer to mortgage loans held for investment - (16,960,549) - Total gains (losses): Included in earnings 7,637,377 (1) 199,306,871 (1) 3,408 (2) Included in other comprehensive income - - 23,785 Balance - December 31, 2020 $ 10,128,610 $ 422,772,418 $ 2,201,175 (1) As a component of mortgage fee income on the consolidated statements of earnings (2) As a component of net investment income on the consolidated statements of earnings Following is a summary of changes in the consolidated balance sheet line items measured using level 3 inputs: Net Derivatives Loan Commitments Loans Held for Sale Fixed Maturity Securities Available for Sale Balance - December 31, 2018 $ 1,591,816 $ 136,210,853 $ - Originations/purchases - 2,606,839,175 - Sales, maturities and paydowns - (2,580,875,055) - Transfer to mortgage loans held for investment - (31,881,851) - Transfer from fixed maturity securities held to maturity - 3,216,382 Total gains (losses): Included in earnings (1) 899,417 83,164,510 - Balance - December 31, 2019 $ 2,491,233 $ 213,457,632 $ 3,216,382 (1) As a component of mortgage fee income on the consolidated statements of earnings The following tables summarize Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a nonrecurring basis by their classification in the consolidated balance sheet at December 31, 2020. Total Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Assets accounted for at fair value on a Impaired mortgage loans held for investment $ 1,297,356 $ - $ - $ 1,297,356 Impaired real estate held for sale 4,249,000 - - 4,249,000 Total assets accounted for at fair value on $ 5,546,356 $ - $ - $ 5,546,356 The following tables summarize Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a nonrecurring basis by their classification in the consolidated balance sheet at December 31, 2019. Total Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Assets accounted for at fair value on a Impaired mortgage loans held for investment $ 1,302,025 $ - $ - $ 1,302,025 Impaired real estate held for investment 8,375,884 - - 8,375,884 Total assets accounted for at fair value on $ 9,677,909 $ - $ - $ 9,677,909 Fair Value of Financial Instruments Carried at Other Than Fair Value ASC 825, Financial Instruments, requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate that value. Management uses its best judgment in estimating the fair value of the Company’s financial instruments; however, there are inherent limitations in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented herein are not necessarily indicative of the amounts the Company could have realized in a sales transaction at December 31, 2020 and 2019. The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows as of December 31, 2020: Carrying Value Level 1 Level 2 Level 3 Total Estimated Fair Value Assets Mortgage loans held for investment Residential $ 92,757,613 $ - $ - $ 100,384,283 $ 100,384,283 Residential construction 110,849,864 - - 110,849,864 110,849,864 Commercial 45,736,459 - - 45,259,425 45,259,425 Mortgage loans held for investment, net $ 249,343,936 $ - $ - $ 256,493,572 $ 256,493,572 Policy loans 14,171,589 - - 14,171,589 14,171,589 Insurance assignments, net (1) 51,585,656 - - 51,585,656 51,585,656 Restricted assets (2) 3,317,877 - - 3,317,877 3,317,877 Cemetery perpetual care trust investments (2) 1,468,600 - - 1,468,600 1,468,600 Mortgage servicing rights, net 35,210,516 - - 38,702,358 38,702,358 Liabilities Bank and other loans payable $(297,824,368) $ - $ - $ (297,824,368) $ (297,824,368) Policyholder account balances (3) (44,026,809) - - (42,220,725) (42,220,725) Future policy benefits - annuities (3) (106,522,113) - - (112,354,186) (112,354,186) (1) Included in other investments and policy loans on the consolidated balance sheets (2) Mortgage loans held for investment (3) Included in future policy benefits and unpaid claims on the consolidated balance sheets The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows as of December 31, 2019: Carrying Value Level 1 Level 2 Level 3 Total Estimated Fair Value Assets Mortgage loans held for investment Residential $ 110,253,678 $ - $ - $ 115,320,638 $ 115,320,638 Residential construction 88,651,967 - - 88,651,967 88,651,967 Commercial 37,788,901 - - 39,289,462 39,289,462 Mortgage loans held for investment, net 236,694,546 $ - $ - $ 243,262,067 $ 243,262,067 Policy loans 14,762,805 - - 14,762,805 14,762,805 Insurance assignments, net (1) 39,614,939 - - 39,614,939 39,614,939 Restricted assets (2) 2,275,756 - - 2,289,679 2,289,679 Cemetery perpetual care trust investments (2) 524,000 - - 536,553 536,553 Mortgage servicing rights, net 17,155,529 - - 22,784,571 22,784,571 Liabilities Bank and other loans payable $ (217,572,612) $ - $ - $ (217,572,612) $ (217,572,612) Policyholder account balances (3) (45,154,180) - - (41,828,469) (41,828,469) Future policy benefits - annuities (3) (113,579,830) - - (117,304,614) (117,304,614) (1) Included in other investments and policy loans on the consolidated balance sheets (2) Mortgage loans held for investment (3) Included in future policy benefits and unpaid claims on the consolidated balance sheets The methods, assumptions and significant valuation techniques and inputs used to estimate the fair value of financial instruments are summarized as follows: Mortgage Loans Held for Investment Residential – The estimated fair value of mortgage loans is determined through a combination of discounted cash flows (estimating expected future cash flows of payments and discounting them using current interest rates from single family mortgages) and considering pricing of similar loans that were sold recently. Residential Construction – These loans are primarily short in maturity. Accordingly, the estimated fair value is determined to be the carrying value. Commercial – The estimated fair value is determined by estimating expected future cash flows of payments and discounting them using current interest rates for commercial mortgages. Policy Loans Insurance Assignments, Net Bank and Other Loans Payable due to their relatively short-term maturities and variable interest rates. Policyholder Account Balances and Future Policy Benefits-Annuities Future policy benefit reserves for interest-sensitive insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. Policy benefits and claims that are charged to expense include benefit claims incurred in the period in excess of related policy account balances. Interest crediting rates for interest-sensitive insurance products ranged from 1.5% to 6.5%. The fair values for these investment-type insurance contracts are estimated based on the present value of liability cash flows. The fair values for the Company’s insurance contracts other than investment-type contracts are not required to be disclosed. However, the fair values of liabilities under all insurance contracts are taken into consideration in the Company’s overall management of interest rate risk, such that the Company’s exposure to changing interest rates is minimized through the matching of investment maturities with amounts due under insurance contracts. |
18) Accumulated Other Comprehen
18) Accumulated Other Comprehensive Income | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
18) Accumulated Other Comprehensive Income | 18) Accumulated Other Comprehensive Income The following summarizes the changes in accumulated other comprehensive income: December 31 2020 2019 Unrealized gains on fixed maturity securities available for sale $ 12,016,464 $ 17,315,770 Amounts reclassified into net earnings (2,772) - Net unrealized gains before taxes 12,013,692 17,315,770 Tax expense (2,522,876) (3,636,311) Net 9,490,816 13,679,459 Unrealized gains on restricted assets (1) 41,225 35,550 Tax expense (10,269) (8,856) Net 30,956 26,694 Unrealized gains on cemetery perpetual care trust investments (1) (6,817) 29,904 Tax expense 1,698 (7,449) Net (5,119) 22,455 Unrealized gains for foreign currency translations adjustments (46) 972 Tax expense 12 (243) Net (34) 729 Other comprehensive income changes $ 9,516,619 $ 13,729,337 _______________ (1) Fixed maturity securities available for sale The following is the accumulated balances of other comprehensive income as of December 31, 2020: Beginning Balance December 31, 2019 Change for the period Ending Balance December 31, Unrealized gains on fixed maturity securities available for sale $ 13,679,459 $ 9,490,816 $ 23,170,275 Unrealized gains on restricted assets (1) 26,694 30,956 57,650 Unrealized gains (losses) on cemetery perpetual 22,455 (5,119) 17,336 Foreign currency translation adjustments (2,094) (34) (2,128) Other comprehensive income $ 13,726,514 $ 9,516,619 $ 23,243,133 (1) Fixed maturity securities available for sale The following is the accumulated balances of other comprehensive income as of December 31, 2019: Beginning Balance December 31, 2018 Change for the period Ending Balance December 31, Unrealized gains on fixed maturity securities available for sale $ - $ 13,679,459 $ 13,679,459 Unrealized gains on restricted assets (1) - 26,694 26,694 Unrealized gains on cemetery perpetual care trust investments (1) - 22,455 22,455 Foreign currency translation adjustments (2,823) 729 (2,094) Other comprehensive income (loss) $ (2,823) $ 13,729,337 $ 13,726,514 (1) Fixed maturity securities available for sale |
19) Derivative Instruments
19) Derivative Instruments | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
19) Derivative Instruments | 19) Derivative Instruments The following table shows the fair value and notional amounts of derivative instruments as of December 31, 2020 and 2019. Fair Values and Notional Amounts of Derivative Instruments December 31, 2020 December 31, 2019 Balance Sheet Location Notional Amount Asset Fair Value Liability Fair Value Notional Amount Asset Fair Value Liability Fair Value Derivatives not designated as hedging instruments: Loan commitments Other assets and Other liabilities $659,245,038 $12,592,672 $2,464,062 $224,202,514 $2,722,580 $231,347 Call options Other liabilities 1,873,200 -- 43,097 1,813,500 -- 62,265 Put options Other liabilities -- -- -- 1,573,100 -- 22,282 Total $661,118,238 $12,592,672 $2,507,159 $227,589,114 $2,722,580 $315,894 The following table shows the gain (loss) on derivatives for the periods presented. There were no gains or losses reclassified from accumulated other comprehensive income into income or gains or losses recognized in income on derivatives ineffective portion or any amounts excluded from effective testing. Net Amount Gain (Loss) Years ended December 31 Derivative Classification 2020 2019 Loan commitments Mortgage fee income $ 7,637,377 $ 899,417 Call and put options Gains on investments and other assets $ 272,758 $ 626,208 |
20) Acquisitions
20) Acquisitions | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
20) Acquisitions | 20) Acquisitions Kilpatrick Life Insurance Company On December 13, 2019, the Company, through its wholly owned subsidiary, Security National Life Insurance Company (“Security National Life”) completed a stock purchase transaction with Kilpatrick Life Insurance Company, a Louisiana domiciled life insurance company (“Kilpatrick Life”) and its shareholders, which resulted in the purchase of all the outstanding shares of common stock of Kilpatrick Life. The closing of the transaction was subject to approval by the Louisiana Department of Insurance of the change of control of Kilpatrick Life, which was received on December 12, 2019. Under the terms of the transaction, the total Purchase Price that Security National Life paid for all the shares held by the Kilpatrick shareholders was $23,779,940 subject to a $1,400,000 holdback deposited into an interest bearing escrow account The current amount that is available to be disbursed to the prior owners is $598,949. Kilpatrick Life has been in operation since 1932 and provides life insurance products and services through insurance plans such as permanent and term life insurance, asset protection plans, graded whole life insurance, and annuities. Additionally, it provides insurance services for emergencies and pre-arranged funeral services. Kilpatrick Life is based in Shreveport, Louisiana with additional offices in Jena, Alexandria, Minden, and Arcadia, Louisiana. Kilpatrick Life employs a staff of almost 120 associates in four offices in Louisiana and is licensed to operate in Louisiana, Texas, Arkansas, Oklahoma, and Mississippi with the home office located in Shreveport, LA. It is the mission of Kilpatrick Life to continue providing the utmost service and protection for its policyholders for generations to come. Prior to the stock purchase transaction, Security National life and Kilpatrick Life entered into a coinsurance agreement, effective October 1, 2019. After the effective date, Security National Life, as coinsurer, agreed to be responsible for and was obligated with respect to 100% of the contractual liabilities under the Kilpatrick Life’s life insurance policies in accordance with the terms and conditions of the policies and applicable law. Unless otherwise directed by Security National Life, as coinsurer, Kilpatrick Life continued to administer the policies on behalf of Security National Life, as coinsurer, for the duration of the coinsurance agreement. As part of the coinsurance agreement, effective October 1, 2019, Security National Life acquired the following assets and assumed the following contractual liabilities. Other investments and policy loans $ 9,124,459 Real estate held for investment 2,850,000 Mortgage loans held for investment 200,000 Receivables 131,258 Total assets acquired 12,305,717 Future policy benefits and unpaid claims (165,404,970) Other liabilities and accrued expenses (5,259,341) Total liabilities assumed (170,664,311) Cash received for reinsurance assumed $ 158,358,594 Contemporaneous with the stock purchase transaction, both Kilpatrick Life and Security National Life, as coinsurer, agreed to terminate the coinsurance agreement, to require the recapture of the life insurance policies by Kilpatrick Life and provided notification to the Louisiana Department of Insurance. The final settlement and transfer of the coinsurance trust assets from Security National Life back to Kilpatrick Life occurred shortly thereafter. The estimated fair values of the assets acquired and liabilities assumed as of the date of acquisition, on December 13, 2019, are shown in the following table. At the time of acquisition some of these assets and liabilities became intercompany items, and the Company has eliminated them for consolidation. Fixed maturity securities, available for sale $ 22,766,520 Fixed maturity securities, held to maturity 16,436 Mortgage loans held for investment 8,011,660 Real estate held for investment 2,708,557 Other investments 446,655 Accrued investment income 183,527 Total investments 34,133,355 Cash and cash equivalents 6,900,654 Receivables, net 5,407,736 (1) Receivables from reinsurers 168,105,064 (1) Property and equipment, net 1,498,245 Value of business acquired 4,962,831 Deferred taxes 167,344 Other 712,323 Total assets acquired 221,887,552 Future policy benefits and unpaid claims (189,071,407) Accounts payable (283,304) Other liabilities and accrued expenses (7,870,944) Income taxes (881,957) Total liabilities assumed (198,107,612) Fair value of net assets acquired/consideration paid $ 23,779,940 Fair value of net assets acquired/consideration paid, net of cash acquired $ 16,879,286 (1) Receivable from reinsurers of $162,907,008 and receivables, net of $5,000,000 were settled with the recapture of the coinsurance agreement by Kilpatrick Life from Security National Life. Kilpatrick Life’s revenues and net loss since the date of acquisition for the year ended December 31, 2019 were $1,461,011 and $848,031, respectively. Probst Family Funerals and Cremations and Heber Valley Funeral Home On February 15, 2019, the Company, through its wholly-owned subsidiary, Memorial Mortuary Inc., completed an asset purchase transaction with Probst Family Funerals and Cremations, LLC. (“Probst Family Funerals”) and Heber Valley Funeral Home, Inc. (“Heber Valley Funeral Home”). These funeral homes are both located in Heber Valley, a community situated about 45 miles southeast of Salt Lake City. Under the terms of the transaction, as set forth in the Asset Purchase Agreement, dated February 15, 2019, Memorial Mortuary Inc. paid a net purchase price of $3,315,647 for the business and assets of Probst Family Funerals and Heber Valley Funeral Home, subject to a $150,000 holdback deposited into an escrow account. In August 2019, this escrow account was settled and $137,550 was paid to the prior owners. The estimated fair values of the assets acquired and liabilities assumed as of the date of acquisition were as follows: Cash $ 53,859 Property and equipment 2,475,526 Receivables 13,620 Goodwill 754,018 Other 21,800 Total assets acquired 3,318,823 Bank and other loans payable (3,176) Total liabilities assumed (3,176) Fair value of net assets acquired/consideration paid $ 3,315,647 Fair value of net assets acquired/consideration paid, net of cash acquired $ 3,261,788 Probst Family Funerals and Heber Valley Funeral Home’s revenues and net earnings since the date of acquisition for the year ended December 31, 2019 were $796,992 and $97,400, respectively. |
21) Mortgage Servicing Rights
21) Mortgage Servicing Rights | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
21) Mortgage Servicing Rights | 21) Mortgage Servicing Rights The Company reports MSRs pursuant to the accounting policy discussed in Note 1 of the Notes to Consolidated Financial Statements. The following table presents the MSR activity for the periods presented. December 31 2020 2019 Amortized cost: Balance before valuation allowance at beginning of year $ 17,155,529 $ 20,016,822 MSR additions resulting from loan sales 29,896,465 4,194,502 Amortization (1) (11,841,478) (7,055,795) Application of valuation allowance to write down MSRs - - Balance before valuation allowance at year end $ 35,210,516 $ 17,155,529 Valuation allowance for impairment of MSRs: Balance at beginning of year $ - $ - Additions - - Application of valuation allowance to write down MSRs - - Balance at year end $ - $ - Mortgage servicing rights, net $ 35,210,516 $ 17,155,529 Estimated fair value of MSRs at year end $ 38,702,358 $ 22,784,571 (1) Included in other expenses on the consolidated statements of earnings The following table summarizes the Company’s estimate of future amortization of its existing MSRs carried at amortized cost. This projection was developed using the assumptions made by management in its December 31, 2020 valuation of MSRs. The assumptions underlying the following estimate will change as market conditions and portfolio composition and behavior change, causing both actual and projected amortization levels to change over time. Therefore, the following estimates will change in a manner and amount not presently determinable by management. Estimated MSR Amortization 2021 $ 4,724,439 2022 3,582,811 2023 3,030,850 2024 2,574,323 2025 2,200,840 Thereafter 19,097,253 Total $ 35,210,516 During the years ended December 31, 2020 and 2019, the Company collected the following contractual servicing fee income and late fee income as reported in other revenues on the consolidated statements of earnings: 2020 2019 Contractual servicing fees $ 8,940,612 $ 7,212,164 Late fees 305,962 365,477 Total $ 9,246,574 $ 7,577,641 The following is a summary of the unpaid principal balances (“UPB”) of the servicing portfolio for the periods presented: Years Ended December 31 2020 2019 Servicing UPB $ 5,070,287,864 $ 2,804,139,415 The following key assumptions were used in determining MSR value: Prepayment Average Discount December 31, 2020 15.60 5.30 9.50 December 31, 2019 15.30 5.27 9.51 |
22) Future Policy Benefits and
22) Future Policy Benefits and Unpaid Claims | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
22) Future Policy Benefits and Unpaid Claims | 22) Future Policy Benefits and Unpaid Claims The Company reports future policy benefits and unpaid claims pursuant to the accounting policy discussed in Note 1 of the Notes to Consolidated Financial Statements. The following table provides information regarding future policy benefits and unpaid claims and the related receivable from reinsurers. Years Ended 2020 2019 Life $ 674,230,463 $654,585,723 Annuities 109,522,112 113,579,831 Policyholder account balances 44,026,809 45,154,180 Accident and health 651,140 667,428 Other policyholder funds 4,354,746 4,530,227 Reported but unpaid claims 8,689,723 4,891,922 Incurred but not reported claims 3,315,094 2,191,607 Gross future policy benefits and unpaid claims $ 844,790,087 $825,600,918 Receivable from reinsurers Life 10,841,567 11,040,398 Annuities 4,047,301 4,038,007 Accident and health 90,231 90,113 Reported but unpaid claims 571,057 569,250 Incurred but not reported claims 19,000 10,000 Total receivable from reinsurers 15,569,156 15,747,768 Net future policy benefits and unpaid claims $ 829,220,931 $809,853,150 |
23) Revenues From Contracts Wit
23) Revenues From Contracts With Customers | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
23) Revenues From Contracts With Customers | 23) Revenues from Contracts with Customers The Company reports revenues from contracts with customers pursuant to ASC No. 606, Revenue from Contracts with Customers. Contracts with Customers Information about Performance Obligations and Contract Balances The Company’s cemetery and mortuary segment sells a variety of goods and services to customers in both at-need and pre-need situations. Due to the timing of the fulfillment of the obligation, revenue is deferred until that obligation is fulfilled. The total contract liability for future obligations is included in deferred pre-need cemetery and mortuary contract revenues on the consolidated balance sheets and, as of December 31, 2020 and 2019, the balances were $13,080,179 and 12,607,978, respectively. The Company’s three types of future obligations are as follows: Pre-need Merchandise and Service Revenue At-need Specialty Merchandise Revenue Deferred Pre-need Land Revenue Complete payment of the contract does not constitute fulfillment of the performance obligation. Goods or services are deferred until such time the service is performed or merchandise is received. Pre-need contracts are required to be paid in full prior to a customer using a good or service from a pre-need contract. Goods and services from pre-need contracts can be transferred when paid in full from one owner to another. In such cases, the Company will act as an agent in transferring the requested goods and services. A transfer of goods and services does not fulfill an obligation and revenue remains deferred. The opening and closing balances of the Company’s receivables, contract assets and contract liabilities are as follows: Contract Balances Receivables (1) Contract Asset Contract Liability Opening (1/1/2020) $ 2,778,879 $ - $ 12,607,978 Closing (12/31/2020) 4,119,988 - 13,080,179 Increase/(decrease) 1,341,109 - 472,201 Contract Balances Receivables (1) Contract Asset Contract Liability Opening (1/1/2019) $ 2,816,225 $ - $ 12,508,625 Closing (12/31/2019) 2,778,879 - 12,607,978 Increase/(decrease) (37,346) - 99,353 (1) Included in Receivables, net on the consolidated balance sheets The following table disaggregates the opening and closing balances of the Company’s contract balances. Contract Balances Contract Asset Contract Liability Pre-need merchandise and services $ - $ 12,325,437 At-need specialty merchandise - 282,541 Pre-need land sales - - Opening (1/1/2020) $ - $ 12,607,978 Pre-need merchandise and services $ - $ 12,545,753 At-need specialty merchandise - 534,426 Pre-need land sales - - Closing (12/31/2020) $ - $ 13,080,179 Contract Balances Contract Asset Contract Liability Pre-need merchandise and services $ - $ 12,175,943 At-need specialty merchandise - 327,302 Pre-need land sales - 5,380 Opening (1/1/2019) $ - $ 12,508,625 Pre-need merchandise and services $ - $ 12,325,437 At-need specialty merchandise - 282,541 Pre-need land sales - - Closing (12/31/2019) $ - $ 12,607,978 The amount of revenue recognized for the years ended December 31, 2020 and 2019 that was included in the opening contract liability balance was $4,359,709 and $3,558,103, respectively. The difference between the opening and closing balances of the Company’s contract assets and contract liabilities primarily results from the timing difference between the Company’s performance and the customer’s payment. Disaggregation of Revenue The following table disaggregates revenue for the Company’s cemetery and mortuary contracts. Years Ended December 31 2020 2019 Major goods/service lines At-need $ 15,212,822 $ 12,334,777 Pre-need 5,094,613 2,961,458 $ 20,307,435 $ 15,296,235 Timing of Revenue Recognition Goods transferred at a point in time $ 13,438,592 $ 10,133,723 Services transferred at a point in time 6,868,843 5,162,512 $ 20,307,435 $ 15,296,235 Significant Judgments and Estimates The Company's cemetery and mortuary segment recognizes revenue on future performance obligations when goods are delivered and when services are performed and is not determined by the terms or payments of the contract as long as any good or service is paid in full prior to delivery. Prices are determined based on the market at the time a contract is created. Goods or services are not partially completed. There are no significant judgements, estimations or allocation methods when revenue should be recognized. Practical Expedients The Company has not elected to use any of the practical expedients under ASC 606. Contract Costs The Company's cemetery and mortuary segment defers certain costs associated with obtaining a contract on future obligations. Pre-need Merchandise and Service Revenue At-need Specialty Merchandise Revenue Deferred Pre-need Land Revenue The following table disaggregates contract costs that are included in deferred policy and pre-need contract acquisition costs on the consolidated balances sheets. Years Ended December 31 2020 2019 Pre-need merchandise and services $ 3,601,638 $ 3,590,266 At-need specialty merchandise 5,302 10,688 Pre-need land sales - - $ 3,606,940 $ 3,600,954 |
24) Leases
24) Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
24) Leases | 24) Leases On January 1, 2019, the Company adopted Accounting Standards Update No. 2016-02 regarding Leases ASC Topic 842. See Note 1 regarding the adoption of this standard. A lease is defined as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. The Company determines if a contract is a lease at the inception of the contract. At the commencement date of a lease, the Company measures the lease liability at the present value of the lease payments over the lease term, discounted using the discount rate for the lease. The Company uses the rate implicit in the lease, if available, otherwise the Company uses its incremental borrowing rate. Also, at the commencement date of a lease, the Company measures the cost of the related right-of-use asset which consists of the amount of the initial measurement of the lease liability, any lease payments made to the lessor at or before the commencement date, minus any lease incentives received and any initial direct costs incurred by the Company. Information about the Nature of Leases and Subleases The Company leases office space and equipment from third-parties under various non-cancelable agreements. The Company has operating leases for office space for its segments in areas where it conducts business. The Company subleases some of this office space. The Company also has finance leases for certain equipment, such as copy machines and postage machines. The Company does not have any lease agreements with variable lease payments. The Company has not included any options to extend or terminate leases in the recognition of the right-of-use assets or lease liabilities because of the uncertainty that they will be exercised. No residual value guarantees have been provided to the Company. The Company does not have any restrictions or covenants imposed by leases. Leases that have not Commenced The Company does not have any leases that have not commenced that create significant rights or obligations for the Company. Related Party Lease Transactions The Company does not have any related party lease transactions that require disclosure as of December 31, 2020. Short-term Leases The Company made an accounting policy election not to apply the recognition requirements of ASC 842 to short-term leases, which are leases that, at the commencement date, have a lease term of 12 months or less and do not include an option to purchase the underlying assets that the lessee is reasonably certain to exercise. Significant Judgments and Assumptions The Company does not use any significant judgments or assumptions regarding the determination of whether a contract contains a lease; the allocation of the consideration in a contract between lease and nonlease components; or the determination of the discount rates for the leases. The following table presents the Company’s total lease cost recognized in earnings, amounts capitalized as right-of- use assets and cash flows from lease transactions for the period presented: Year Ended December 31 Year Ended December 31 2020 2019 Lease Cost Finance lease cost: Amortization of right-of-use assets (1) $ 58,576 $ 38,351 Interest on lease liabilities (2) 7,341 9,001 Operating lease cost (3) 5,408,737 5,706,490 Short-term lease cost (3)(4) 222,311 233,318 Sublease income (3) (394,758) (663,242) Total lease cost $ 5,302,207 $ 5,323,918 Other Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 5,293,901 $ 5,567,761 Operating cash flows from finance leases 7,341 9,001 Financing cash flows from finance leases 56,982 95,931 Right-of-use assets obtained in exchange for lease liabilities: Operating leases $ 5,631,193 $ 16,544,406 Finance leases 8,494 252,763 Weighted-average remaining lease term (in years) Finance leases 2.74 3.23 Operating leases 5.40 4.67 Weighted-average discount rate Finance leases 5.59% 5.47% Operating leases 4.87% 5.06% (1) Included in Depreciation on property and equipment on the consolidated statements of earnings (2) Included in Interest expense on the consolidated statements of earnings (3) Included in Rent and rent related expenses on the consolidated statements of earnings (4) Includes leases with a term of 12 months or less The following table presents the maturity analysis of the Company’s lease liabilities. Finance Leases Operating Leases Lease payments due in: 2021 $ 46,898 $ 4,344,756 2022 34,458 3,004,271 2023 27,220 2,088,028 2024 4,354 1,567,924 2025 692 837,526 Thereafter - 2,938,906 Total undiscounted lease payments 113,622 14,781,411 Less: Discount on cash flows (8,671) (2,859,527) Present value of lease liabilities $ 104,951 $ 11,921,884 The following table presents the Company’s right-of-use assets and lease liabilities for the period presented: Balance Sheet Location Year Ended December 31 2020 Year Ended December 31 2019 Operating Leases Right-of-use assets Other assets $ 11,663,245 $ 11,267,247 Lease liabilities Other liabilities and accrued expenses $ 11,921,884 $ 11,405,976 Finance Leases Right-of-use assets $ 254,276 $ 248,565 Accumulated amortization (154,144) (98,351) Right-of-use assets, net Property and equipment, net $ 100,132 $ 150,214 Lease liabilities Bank and other loans payable $ 104,951 $ 153,439 The Company is also a lessor and has operating lease agreements with various tenants that lease its commercial and residential properties. See Note 2 for information about the Company’s real estate held for investment. |
1) Significant Accounting Pol_2
1) Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
General Overview of Business | General Overview of Business Security National Financial Corporation and its wholly owned subsidiaries (the “Company”) operate in three reportable business segments: life insurance, cemetery and mortuary, and mortgages. The life insurance segment is engaged in the business of selling and servicing selected lines of life insurance, annuity products and accident and health insurance marketed primarily in the Intermountain West, California and eleven southern states. The cemetery and mortuary segment of the Company consists of eight mortuaries and five cemeteries in Utah and one cemetery in California. The mortgage segment is an approved government and conventional lender that originates and underwrites residential and commercial loans for new construction, existing homes and real estate projects primarily in Florida, Nevada, Texas, and Utah. |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP). |
Principles of Consolidation | Principles of Consolidation These consolidated financial statements include the financial statements of the Company and its majority owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. |
Use of Estimates | Use of Estimates Management of the Company has made a number of estimates and assumptions related to the reported amounts of assets and liabilities, reported amounts of revenues and expenses, and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with GAAP. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant changes in the near term are those used in determining the value of derivative assets and liabilities; those used in determining deferred acquisition costs and the value of business acquired; those used in determining the value of mortgage loans foreclosed to real estate held for investment; those used in determining the liability for future policy benefits; those used in determining the value of mortgage servicing rights; those used in determining allowances for loan losses for mortgage loans held for investment; those used in determining loan loss reserve; and those used in determining deferred tax assets and liabilities. Although some variability is inherent in these estimates, management believes the amounts provided are fairly stated in all material respects. |
Investments | Investments The Company’s management determines the appropriate classifications of investments in fixed maturity securities and equity securities at the acquisition date and re-evaluates the classifications at each balance sheet date. Fixed maturity securities available for sale Equity securities Mortgage loans held for investment Mortgage loans are secured by the underlying property and require an appraisal at the time of underwriting and funding. Generally, the Company will fund a loan not to exceed 80% of the loan’s collateral fair market value. Amounts over 80% will require additional collateral or mortgage insurance by an approved third-party insurer. Real estate held for investment Real estate held for sale Other investments and policy loans Gains and losses on investments (except for equity securities carried at fair value through net earnings) |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. The Company maintains its cash in bank deposit accounts, which at times exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents. |
Loans Held for Sale | Loans Held for Sale Accounting Standards Codification (“ASC”) No. 825, “Financial Instruments”, allows for the option to report certain financial assets and liabilities at fair value initially and at subsequent measurement dates with changes in fair value included in earnings. The option may be applied instrument by instrument, but it is irrevocable. The Company elected the fair value option for loans held for sale. The Company believes the fair value option most closely aligns the timing of the recognition of gains and costs. These loans are intended for sale and the Company believes that the fair value is the best indicator of the resolution of these loans. Electing fair value also reduces certain timing differences and better matches changes in the fair value of these assets with changes in the fair value of the related derivatives used for these assets. See Note 3 and Note 17 to Consolidated Financial Statements for additional disclosures regarding loans held for sale. |
Mortgage Fee Income | Mortgage Fee Income Mortgage fee income consists of origination fees, processing fees, interest income and certain other income related to the origination of mortgage loans held for sale. All revenues and costs are recognized when the mortgage loan is funded and any changes in fair value are shown as a component of mortgage fee income. See Note 3 and Note 17 to Consolidated Financial Statements for additional disclosures regarding loans held for sale. The Company, through its mortgage subsidiaries, sells mortgage loans to third-party investors without recourse unless defects are identified in the representations and warranties made at loan sale. It may be required, however, to repurchase a loan or pay a fee instead of repurchase under certain events, which include the following: · Failure to deliver original documents specified by the investor, · The existence of misrepresentation or fraud in the origination of the loan, · The loan becomes delinquent due to nonpayment during the first several months after it is sold, · Early pay-off of a loan, as defined by the agreements, · Excessive time to settle a loan, · Investor declines purchase, and · Discontinued product and expired commitment. Loan purchase commitments generally specify a date 30 to 45 days after delivery upon which the underlying loans should be settled. Depending on market conditions, these commitment settlement dates can be extended at a cost to the Company. It is the Company's policy to cure any documentation problems regarding such loans at a minimal cost for up to a six-month time period and to pursue efforts to enforce loan purchase commitments from third-party investors concerning the loans. The Company believes that six months allows adequate time to remedy any documentation issues, to enforce purchase commitments, and to exhaust other alternatives. Remedial methods include the following: · Research reasons for rejection, · Provide additional documents, · Request investor exceptions, · Appeal rejection decision to purchase committee, and · Commit to secondary investors. Once purchase commitments have expired and other alternatives to remedy are exhausted, which could be earlier than the six-month time period, the loans are repurchased and transferred to the long-term investment portfolio at the lower of cost or fair value and previously recorded mortgage fee income that was to be received from a third-party investor is written off against the loan loss reserve. |
Determining Lower of Cost or Fair Value | Determining Lower of Cost or Fair Value Cost for loans held for sale is equal to the amount paid to the warehouse bank and the amount originally funded by the Company. Fair value is often difficult to determine, but is based on the following: · For loans that are committed, the Company uses the commitment price. · For loans that are non-committed that have an active market, the Company uses the market price. · For loans that are non-committed where there is no market but there is a similar product, the Company uses the market value for the similar product. · For loans that are non-committed where no active market exists, the Company determines that the unpaid principal balance best approximates the market value, after considering the fair value of the underlying real estate collateral, estimated future cash flows, and the loan interest rate. The appraised value of the real estate underlying the original mortgage loan adds support to the Company’s determination of fair value because if the loan becomes delinquent, the Company has sufficient value to collect the unpaid principal balance or the carrying value of the loan, thus minimizing credit losses. The majority of loans originated are sold to third-party investors. The amounts expected to be sold to investors are shown on the consolidated balance sheets as loans held for sale. |
Loan Loss Reserve | Loan Loss Reserve The loan loss reserve is an estimate of probable losses at the balance sheet date that the Company will realize in the future on loans sold. The Company may be required to reimburse third-party investors for costs associated with early payoff of loans within six months of origination of such loans and to repurchase loans where there is a default in any of the first four monthly payments to the investors or, in lieu of repurchase, to pay a negotiated fee to the investors. The Company’s estimates are based upon historical loss experience and the best estimate of the probable loan loss liabilities. Upon completion of a transfer that satisfies the conditions to be accounted for as a sale, the Company initially measures at fair value liabilities incurred in a sale relating to any guarantee or recourse provisions. The Company accrues a monthly allowance for indemnification losses to investors based on total production. This estimate is based on the Company’s historical experience and is included as a component of mortgage fee income. Subsequent updates to the recorded liability from changes in assumptions are recorded in selling, general and administrative expenses as a component of provision for loan loss reserve. The estimated liability for indemnification losses is included in other liabilities and accrued expenses. The loan loss reserve analysis involves mortgage loans that have been sold to third-party investors, which were believed to have met investor underwriting guidelines at the time of sale, where the Company has received a demand from the investor. There are generally three types of demands: make whole, repurchase, or indemnification. These types of demands are further described as follows: Make whole demand Repurchase demand Indemnification demand The Company believes the allowance for loan losses and the loan loss reserve represent probable loan losses incurred as of the balance sheet date. Additional information related to the Loan Loss Reserve is included in Note 3. |
Restricted Assets | Restricted Assets Restricted assets are assets held in a trust account for future mortuary services and merchandise and consist of cash and cash equivalents; participations in mortgage loans held for investment with Security National Life Insurance Company (“Security National Life”); mutual funds carried at estimated fair value; equity securities carried at estimated fair value; and a surplus note with Security National Life (which is eliminated in consolidation). Restricted assets also represents escrows held for borrowers and investors under servicing and appraisal agreements relating to mortgage loans, funds held by warehouse banks in accordance with loan purchase agreements and funds held in escrow for certain real estate construction development projects. Additionally, the Company funded its medical benefit safe-harbor limit based on the qualified direct costs, and has included this amount as a component of restricted cash. |
Cemetery Perpetual Care Trust Investments | Cemetery Perpetual Care Trust Investments Cemetery endowment care trusts have been set up for four of the six cemeteries owned by the Company. Under endowment care arrangements a portion of the price for each lot sold is withheld and invested in a portfolio of investments similar to those described in the prior paragraph. The earnings stream from the investments is designed to fund future maintenance and upkeep of the cemetery. |
Cemetery Land and Improvements | Cemetery Land and Improvements The development of a cemetery involves not only the initial acquisition of raw land but also the installation of roads, water lines, landscaping and other costs to establish a marketable cemetery lot. The costs of developing the cemetery are shown as an asset on the balance sheet. The amount on the balance sheet is reduced by the total cost assigned to the development of a particular lot when the criterion for recognizing a sale of that lot is met. |
Deferred Policy Acquisition Costs and Value of Business Acquired | Deferred Policy Acquisition Costs and Value of Business Acquired Commissions and other costs, net of commission and expense allowances for reinsurance ceded, that vary with and are primarily related to the production of new insurance business have been deferred. Deferred policy acquisition costs (“DAC”) for traditional life insurance are amortized over the premium paying period of the related policies using assumptions consistent with those used in computing policy benefit reserves. For interest-sensitive insurance products, deferred policy acquisition costs are amortized generally in proportion to the present value of expected gross profits from surrender charges, investment, mortality and expense margins. This amortization is adjusted when estimates of current or future gross profits to be realized from a group of products are reevaluated. Deferred acquisition costs are written off when policies lapse or are surrendered. When accounting for DAC, the Company considers internal replacements of insurance and investment contracts. An internal replacement is a modification in product benefits, features, rights or coverage that occurs by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to contract, or by the election of a feature or coverage within a contract. Modifications that result in a replacement contract that is substantially changed from the replaced contract are accounted for as an extinguishment of the replaced contract. Unamortized DAC, unearned revenue liabilities and deferred sales inducements from the replaced contract are written-off. Modifications that result in a contract that is substantially unchanged from the replaced contract are accounted for as a continuation of the replaced contract. Value of business acquired is the present value of estimated future profits of the acquired business and is amortized similar to deferred policy acquisition costs. |
Mortgage Servicing Rights | Mortgage Servicing Rights Mortgage Servicing Rights (“MSR”) arise from contractual agreements between the Company and third-party investors (or their agents) when mortgage loans are sold. Under these contracts, the Company is obligated to retain and provide loan servicing functions on loans sold, in exchange for fees and other remuneration. The servicing functions typically performed include, among other responsibilities, collecting and remitting loan payments; responding to borrower inquiries; accounting for principal and interest, holding custodial (impound) funds for payment of property taxes and insurance premiums; counseling delinquent mortgagors; and supervising the acquisition of real estate owned and property dispositions. The total residential mortgage loans serviced for others consist primarily of agency conforming fixed-rate mortgage loans. The value of MSRs is derived from the net cash flows associated with the servicing contracts. The Company receives a servicing fee of generally about 0.250% annually on the remaining outstanding principal balances of the loans. Based on the result of the cash flow analysis, an asset or liability is recorded for mortgage servicing rights. The servicing fees are collected from the monthly payments made by the mortgagors. The Company generally receives other remuneration including rights to various mortgagor-contracted fees such as late charges, and collateral reconveyance charges and the Company is generally entitled to retain the interest earned on funds held pending remittance of mortgagor principal, interest, tax and insurance payments. Contractual servicing fees and late fees are included in other revenues on the consolidated statements of earnings. The Company’s subsequent accounting for MSRs is based on the class of MSRs. The Company has identified two classes of MSRs: MSRs backed by mortgage loans with initial term of 30 years and MSRs backed by mortgage loans with initial term of 15 years. The Company distinguishes between these classes of MSRs due to their differing sensitivities to change in value as the result of changes in market. After being initially recorded at fair value, MSRs backed by mortgage loans are accounted for using the amortization method. Amortization expense is included in other expenses on the consolidated statements of earnings. MSR amortization is determined by amortizing the MSR balance in proportion to, and over the period of the estimated future net servicing income of the underlying financial assets. Interest rate risk, prepayment risk, and default risk are inherent risks in MSR valuation. Interest rate changes largely drive prepayment rates. Refinance activity generally increases as rates decline. A significant decrease in rates beyond expectation could cause a decline in the value of the MSR. On the contrary, if rates increase borrowers are less likely to refinance or prepay their mortgage, which extends the duration of the loan and MSR values are likely to rise. Because of these risks, discount rates and prepayment speeds are used to estimate the fair value. The Company periodically assesses MSRs for impairment. Impairment occurs when the current fair value of the MSR falls below the asset’s carrying value (carrying value is the amortized cost reduced by any related valuation allowance). If MSRs are impaired, the impairment is recognized in current period earnings and the carrying value of the MSRs is adjusted through a valuation allowance. Management periodically reviews the various loan strata to determine whether the value of the MSRs in a given stratum is impaired and likely to recover. When management deems recovery of the value to be unlikely in the foreseeable future, a write-down of the cost of the MSRs for that stratum to its estimated recoverable value is charged to the valuation allowance. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Depreciation is calculated principally on the straight-line method over the estimated useful lives of the assets which range from three to forty years. Leasehold improvements paid for by the Company as a lessee are amortized over the lesser of the useful life or remaining lease terms. |
Long-lived Assets | Long-lived Assets Long-lived assets to be held and used, including property and equipment and real estate held for investment, are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the fair value of the asset, and long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell. No impairment of long-lived assets has been recognized in the accompanying financial statements except for certain impairments of real estate held for investment as disclosed in Note 2. |
Derivative Instruments | Derivative Instruments Mortgage Banking Derivatives Loan Commitments The Company is exposed to price risk due to the potential impact of changes in interest rates on the values of loan commitments from the time a loan commitment is made to an applicant to the time the loan that would result from the exercise of that loan commitment is funded. Managing price risk is complicated by the fact that the ultimate percentage of loan commitments that will be exercised (i.e., the number of loans that will be funded) fluctuates. The probability that a loan will not be funded or the loan application is denied or withdrawn within the terms of the commitment is driven by a number of factors, particularly the change, if any, in mortgage rates following the issuance of the loan commitment. In general, the probability of funding increases if mortgage rates rise and decreases if mortgage rates fall. This is due primarily to the relative attractiveness of current mortgage rates compared to the applicant’s committed rate. The probability that a loan will not be funded within the terms of the mortgage loan commitment also is influenced by the source of the applications (retail, broker or correspondent channels), proximity to rate lock expiration, purpose for the loan (purchase or refinance), product type and the application approval status. The Company has developed fallout estimates using historical data that take into account all of the variables, as well as renegotiations of rate and point commitments that tend to occur when mortgage rates fall. These fallout estimates are used to estimate the number of loans that the Company expects to be funded within the terms of the loan commitments and are updated periodically to reflect the most current data. The Company estimates the fair value of a loan commitment based on the change in estimated fair value of the underlying mortgage loan, quoted mortgage-backed securities (“MBS”) prices, estimates of the fair value of mortgage servicing rights, and an estimate of the probability that the mortgage loan will fund within the terms of the commitment. The change in fair value of the underlying mortgage loan is measured from the date the loan commitment is issued and is shown net of expenses. Following issuance, the value of a loan commitment can be either positive or negative depending upon the change in value of the underlying mortgage loans. Forward Sale Commitments The Company utilizes forward commitments to economically hedge the price risk associated with its outstanding mortgage loan commitments. A forward commitment protects the Company from losses on sales of the loans arising from exercise of the loan commitments. Management expects these types of commitments will experience changes in fair value opposite to changes in fair value of the loan commitments, thereby reducing earnings volatility related to the recognition in earnings of changes in the values of the commitments. The net changes in fair value of loan commitments and forward sale commitments are shown in current earnings as a component of mortgage fee income on the consolidated statements of earnings. Mortgage banking derivatives are shown in other assets and other liabilities and accrued expenses on the consolidated balance sheets. Call and Put Option Derivatives The Company uses a strategy of selling “out of the money” call options on its equity securities as a source of revenue. The options give the purchaser the right to buy from the Company specified equity securities at a set price up to a pre-determined date in the future. The Company uses the strategy of selling put options as a means of generating cash or purchasing equity securities at lower than current market prices. The Company receives an immediate payment of cash for the value of the option and establishes a liability for the fair value of the option. The liability for options is adjusted to fair value at each reporting date. In the event a call option is exercised, the Company sells the equity security at a favorable price enhanced by the value of the option that was sold. If the option expires unexercised, the Company recognizes a gain from the expired option. In the event a put option is exercised, the Company acquires an equity security at the strike price of the option reduced by the value received from the sale of the put option. The equity security is then treated as a normal equity security in the Company’s portfolio. The net changes in the fair value of call and put options are shown in current earnings as a component of realized gains (losses) on investments and other assets. Call and put options are shown in other liabilities and accrued expenses on the consolidated balance sheets. |
Allowance for Doubtful Accounts and Loan Losses and Impaired Loans | Allowance for Doubtful Accounts and Loan Losses and Impaired Loans The Company records an allowance and recognizes an expense for potential losses from mortgage loans held for investment, other investments and receivables in accordance with GAAP. Receivables are the result of cemetery and mortuary operations, mortgage loan operations and life insurance operations. The allowance is based upon the Company’s historical experience for collectively evaluated impairment. Other allowances are based upon receivables individually evaluated for impairment. Collectability of the cemetery and mortuary receivables is significantly influenced by current economic conditions. The critical issues that impact recovery of mortgage loan operations are interest rate risk, loan underwriting, new regulations and the overall economy. The Company provides for losses on its mortgage loans held for investment through an allowance for loan losses (a contra-asset account). The allowance is comprised of two components. The first component is an allowance for collectively evaluated impairment that is based upon the Company’s historical experience in collecting similar receivables. The second component is based upon individual evaluation of loans that are determined to be impaired. Upon determining impairment, the Company establishes an individual impairment allowance based upon an assessment of the fair value of the underlying collateral. See the schedules in Note 2 for additional information. The allowance for losses on mortgage loans held for investment could change based on changes in the value of the underlying collateral, the performance status of the loans, or the Company’s actual collection experience. The actual losses could change, in the near term, from the established allowance, based upon the occurrence or non-occurrence of these events. For purposes of determining the allowance for losses, the Company has segmented its mortgage loans held for investment by loan type. The Company’s loan types are commercial, residential, and residential construction. The inherent risks within the portfolio vary depending upon the loan type as follows: Commercial Residential Residential construction (including land acquisition and development) |
Future Policy Benefits and Unpaid Claims | Future Policy Benefits and Unpaid Claims Future policy benefit reserves for traditional life insurance are computed using a net level method, including assumptions as to investment yields, mortality, morbidity, withdrawals, and other assumptions based on the life insurance subsidiaries’ experience, modified as necessary to give effect to anticipated trends and to include provisions for possible unfavorable deviations. Such liabilities are, for some plans, graded to equal statutory values or cash values at or prior to maturity, which are deemed a reasonable equivalent for GAAP. The range of assumed interest rates for all traditional life insurance policy reserves was 4% to 10%. Benefit reserves for traditional limited-payment life insurance policies include the deferred portion of the premiums received during the premium-paying period. Deferred premiums are recognized as income over the life of the policies. Policy benefit claims are charged to expense in the period the claims are incurred. Increases in future policy benefits are charged to expense. Future policy benefit reserves for interest-sensitive insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. Policy benefits and claims that are charged to expense include benefit claims incurred in the period in excess of related policy account balances. Interest crediting rates for interest-sensitive insurance products ranged from 3% to 6.5%. The Company records an unpaid claims liability for claims in the course of settlement equal to the death benefit amount less any reinsurance recoverable amount for claims reported. There is also an unpaid claims liability for claims incurred but not reported. This liability is based on the historical experience of the net amount of claims that were reported in reporting periods subsequent to the reporting period when claims were incurred. |
Participating Insurance | Participating Insurance Participating business constituted 2% of insurance in force for the years ended 2020 and 2019. The provision for policyholders’ dividends included in policyholder obligations is based on dividend scales anticipated by management. Amounts to be paid are determined by the Board of Directors. |
Recognition of Insurance Premiums and Other Considerations | Recognition of Insurance Premiums and Other Considerations Premiums |
Reinsurance | Reinsurance The Company follows the procedure of reinsuring risks in excess of $100,000 to provide for greater diversification of business to allow management to control exposure to potential losses arising from large risks, and provide additional capacity for growth. The Company remains liable for amounts ceded in the event the reinsurers are unable to meet their obligations. The Company entered into coinsurance agreements with unaffiliated insurance companies under which the Company assumed 100% of the risk for certain life insurance policies and certain other policy-related liabilities of the insurance company. Reinsurance premiums, commissions, expense reimbursements, and reserves related to reinsured business are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts. Expense allowances received in connection with reinsurance ceded are accounted for as a reduction of the related policy acquisition costs and are deferred and amortized accordingly. |
Pre-need Sales and Costs | Pre-need Sales and Costs Pre-need contract sales of funeral services and caskets Sales of cemetery interment rights (cemetery burial property) Pre-need contract sales of cemetery merchandise (primarily markers and vaults) Pre-need contract sales of cemetery services (primarily merchandise delivery, installation fees and burial opening and closing fees) Prearranged funeral and pre-need cemetery customer acquisition costs Revenues and costs for at-need sales are recorded when a valid contract exists, the services are performed, collection is reasonably assured and there are no significant obligations remaining. The Company, through its cemetery and mortuary operations, provides guaranteed funeral arrangements wherein a prospective customer can receive future goods and services at guaranteed prices. To accomplish this, the Company, through its life insurance operations, sells to the customer an increasing benefit life insurance policy that is assigned to the mortuaries. If, at the time of need, the policyholder/potential mortuary customer utilizes one of the Company’s facilities, the guaranteed funeral arrangement contract that has been assigned will provide the funeral goods and services at the contracted price. The increasing life insurance policy will cover the difference between the original contract prices and current prices. Risks may arise if the difference cannot be fully met by the life insurance policy. However, management believes that given current inflation rates and related price increases of goods and services, the risk of exposure is minimal. |
Goodwill | Goodwill Previous acquisitions have been accounted for as purchases under which assets acquired and liabilities assumed were recorded at their fair values with the excess purchase price recognized as goodwill. The Company evaluates annually or when changes in circumstances warrant the recoverability of goodwill and if there is a decrease in value, the related impairment is recognized as a charge against income. No impairment of goodwill has been recognized in the accompanying financial statements. |
Other Intangibles (trade name and customer lists) | Other Intangibles (trade name and customer lists) Other intangibles are recognized apart from goodwill whenever an acquired intangible asset arises from contractual or other legal rights, or whenever it is capable of being separated or divided from the acquired entity and sold, transferred, licensed, rented, or exchanged, either individually or in combination with a related contract, asset, or liability. The Company engaged a valuation firm to analyze the value of the Kilpatrick Life name in conjunction with its acquisition. The value of the trade name is included in Other Assets and was determined using the income approach, relying on a relief from the royalty method. |
Income Taxes | Income Taxes Income taxes include taxes currently payable plus deferred taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the temporary differences in the financial reporting basis and tax basis of assets and liabilities and operating loss carry-forwards. Deferred tax assets are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. Liabilities are established for uncertain tax positions expected to be taken in income tax returns when such positions are judged to meet the “more-likely-than-not” threshold based on the technical merits of the positions. Estimated interest and penalties related to uncertain tax penalties are included as a component of other expenses. |
Earnings Per Common Share | Earnings Per Common Share The Company computes earnings per share which requires presentation of basic and diluted earnings per share. Basic earnings per equivalent Class A common share are computed by dividing net earnings by the weighted-average number of Class A common shares outstanding during each year presented, after the effect of the assumed conversion of Class C common stock to Class A common stock. Diluted earnings per share is computed by dividing net earnings by the weighted-average number of common shares outstanding during the year used to compute basic earnings per share plus dilutive potential incremental shares. Basic and diluted earnings per share amounts have been adjusted retroactively for the effect of annual stock dividends. |
Stock Based Compensation | Stock Based Compensation The cost of employee services received in exchange for an award of equity instruments is recognized in the financial statements and is measured based on the fair value on the grant date of the award. The fair value of stock options is calculated using the Black Scholes Option Pricing Model. Stock option compensation expense is recognized over the period during which an employee is required to provide service in exchange for the award and is included in personnel expenses on the consolidated statements of earnings. |
Concentration of Credit Risk | Concentration of Credit Risk For a description of the geographic concentration risk regarding mortgage loans held for investment and real estate held for investment, refer to Note 2 of the Notes to Consolidated Financial Statements. |
Advertising | Advertising The Company expenses advertising costs as incurred. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Standards Adopted in 2020 ASU No. 2018-13: “Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement” Accounting Standards Adopted in 2019 ASU No. 2016-02: “Leases (Topic 842)” The Company adopted this standard on January 1, 2019 using the modified retrospective transition method with no cumulative-effect adjustment to the opening balance of retained earnings. Under this transition method, the application date was the beginning of the reporting period, January 1, 2019, in which the Company first applied the standard. Under this transition option, the Company will apply the legacy guidance in ASC 840, “Leases”, including its disclosure requirements, in the comparative periods presented in the year of adoption. The Company has made an accounting policy election not to apply the recognition requirements to short-term leases, which are leases that, at the commencement date, have a lease term of 12 months or less and do not include an option to purchase the underlying assets that the lessee is reasonably certain to exercise. The new authoritative guidance allows for certain practical expedients to be utilized to assist with the implementation of the new standard. The Company has elected the transition package of practical expedients which allows the Company to not reassess whether any expired or existing contracts are or contain leases, to not reassess the lease classification for any expired or existing leases and to not reassess initial direct costs for any existing leases. The Company implemented a third-party lease accounting system to assist with the measurement of the lease liabilities and the related right-of-use assets. The Company compiled an inventory of its leases, determined the appropriate discount rates and has determined the impact of this standard which is not material to the Company’s results of operations, but has an effect on the balance sheet presentation for leased assets and obligations. The Company recognized a right-of-use asset and related lease liability for approximately $12,076,000 on January 1, 2019. This standard did not impact the Company’s accounting for leases where the Company is the lessor. Accounting Standards Issued But Not Yet Adopted ASU No. 2016-13: “Financial Instruments – Credit Losses (Topic 326)” ASU No. 2018-12: “Financial Services – Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts” The Company has reviewed other recent accounting pronouncements and has determined that they will not significantly impact the Company’s results of operations or financial position. |
2) Investments (Tables)
2) Investments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Block Supplement [Abstract] | |
Available for sale | The Company’s investments as of December 31, 2020 are summarized as follows: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value December 31, 2020 Fixed maturity securities, available for sale, at estimated fair value: U.S. Treasury securities and obligations of U.S. Government agencies $ 42,381,805 $ 1,358,562 $ - $ 43,740,367 Obligations of states and political subdivisions 5,383,762 312,214 (1,261) 5,694,715 Corporate securities including public utilities 186,067,912 27,216,496 (681,478) 212,602,930 Mortgage-backed securities 31,047,791 1,565,377 (267,106) 32,346,062 Redeemable preferred stock 269,214 3,391 - 272,605 Total fixed maturity securities available for sale $ 265,150,484 $ 30,456,040 $ (949,845) $ 294,656,679 Equity securities at estimated fair value: Common stock: Industrial, miscellaneous and all other $ 9,698,490 $ 2,376,156 $ (750,407) $ 11,324,239 Total equity securities at estimated fair value $ 9,698,490 $ 2,376,156 $ (750,407) $ 11,324,239 Mortgage loans held for investment at amortized cost: Residential $ 95,822,448 Residential construction 111,111,777 Commercial 46,836,866 Less: Unamortized deferred loan fees, net (1,161,132) Less: Allowance for loan losses (2,005,127) Less: Net discounts (1,260,896) Total mortgage loans held for investment $ 249,343,936 Real estate held for investment - net of accumulated depreciation: Residential $ 24,843,743 Commercial 106,840,710 Total real estate held for investment $ 131,684,453 Real estate held for sale: Residential $ 3,478,254 Commercial 4,400,553 Total real estate held for sale $ 7,878,807 Other investments and policy loans at amortized cost: Policy loans $ 14,171,589 Insurance assignments 53,231,131 Federal Home Loan Bank stock (1) 2,506,600 Other investments 5,432,816 Less: Allowance for doubtful accounts (1,645,475) Total policy loans and other investments $ 73,696,661 Accrued investment income $ 5,360,523 Total investments $ 773,945,298 (1) Includes $866,900 of Membership stock and $1,639,700 of Activity stock due to short-term borrowings. The Company’s investments as of December 31, 2019 are summarized as follows: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value December 31, 2019 Fixed maturity securities, available for sale, at estimated fair value: U.S. Treasury securities and obligations of U.S. Government agencies $ 142,740,641 $ 632,185 $ (25,215) $ 143,347,611 Obligations of states and political subdivisions 7,450,366 87,812 (9,026) 7,529,152 Corporate securities including public utilities 156,599,184 16,768,449 (463,413) 172,904,220 Mortgage-backed securities 31,475,280 597,395 (240,177) 31,832,498 Redeemable preferred stock 364,339 - - 364,339 Total fixed maturity securities available for sale $ 338,629,810 $ 18,085,841 $ (737,831) $ 355,977,820 Equity securities at estimated fair value: Common stock: Industrial, miscellaneous and all other $ 6,900,537 $ 1,139,799 $ (769,171) $ 7,271,165 Total equity securities at estimated fair value $ 6,900,537 $ 1,139,799 $ (769,171) $ 7,271,165 Mortgage loans held for investment at amortized cost: Residential $ 113,043,965 Residential construction 89,430,237 Commercial 38,718,220 Less: Unamortized deferred loan fees, net (2,391,567) Less: Allowance for loan losses (1,453,037) Less: Net discounts (653,272) Total mortgage loans held for investment $ 236,694,546 Real estate held for investment - net of accumulated depreciation: Residential $ 12,530,306 Commercial 90,226,640 Total real estate held for investment $ 102,756,946 Real estate held for sale: Residential $ 8,021,306 Commercial 6,076,321 Total real estate held for sale $ 14,097,627 Other investments and policy loans at amortized cost: Policy loans $ 14,762,805 Insurance assignments 41,062,965 Federal Home Loan Bank stock (1) 894,300 Other investments 4,973,225 Less: Allowance for doubtful accounts (1,448,026) Total policy loans and other investments $ 60,245,269 Accrued investment income $ 4,833,232 Total investments $ 781,876,605 (1) Includes $894,300 of Membership stock and $-0- of Activity stock due to short-term borrowings. |
Schedule of Unrealized Loss on Investments | The unrealized losses were primarily related to interest rate fluctuations and uncertainties relating to COVID-19. The tables set forth unrealized losses by duration with the fair value of the related fixed maturity securities: Unrealized Losses for Less than Twelve Months Fair Value Unrealized Losses for More than Twelve Months Fair Value Total Unrealized Loss Fair Value At December 31, 2020 Obligations of States and Political Subdivisions $ 1,261 $ 206,812 $ - $ - $ 1,261 $ 206,812 Corporate Securities 242,596 9,919,298 438,882 2,593,026 681,478 12,512,324 Mortgage and other asset-backed securities 266,522 3,455,574 584 51,961 267,106 3,507,535 Total unrealized losses $ 510,379 $13,581,684 $ 439,466 2,644,987 $ 949,845 $16,226,671 At December 31, 2019 U.S. Treasury Securities and Obligations of U.S. Government Agencies $ 20,211 $30,629,288 $ 5,004 $10,000,400 $ 25,215 $40,629,688 Obligations of States and Political Subdivisions 9,026 3,062,889 - - 9,026 3,062,889 Corporate Securities 118,746 7,184,311 344,667 3,950,509 463,413 11,134,820 Mortgage and other asset-backed securities 205,470 13,266,443 34,707 502,769 240,177 13,769,212 Total unrealized losses $ 353,453 $54,142,931 $ 384,378 $14,453,678 $ 737,831 $68,596,609 |
Schedule of earnings on fixed maturity securities | The following table presents a rollforward of the Company's cumulative other than temporary credit impairments (“OTTI”) recognized in earnings on fixed maturity securities available for sale for the years ended December 31: 2020 2019 Balance of credit-related OTTI at January 1 $ - $ - Additions for credit impairments recognized on: Securities not previously impaired 370,975 - Securities previously impaired - - Reductions for credit impairments previously recognized on: Securities that matured or were sold during the period (realized) - - Securities due to an increase in expected cash flows - - Balance of credit-related OTTI at December 31 $ 370,975 $ - |
Investments Classified by Contractual Maturity Date | Expected maturities may differ from contractual maturities because certain borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Estimated Fair Cost Value Due in 1 year $ 28,634,042 $ 28,831,983 Due in 2-5 years 66,183,907 70,910,775 Due in 5-10 years 70,162,166 78,592,046 Due in more than 10 years 68,853,364 83,703,208 Mortgage-backed securities 31,047,791 32,346,062 Redeemable preferred stock 269,214 272,605 Total $ 265,150,484 $ 294,656,679 |
Gain (Loss) on Investments | The Company’s net realized gains and losses from sales, calls, and maturities, unrealized gains and losses on equity securities, and other than temporary impairments from investments and other assets for the years ended December 31 are summarized as follows: 2020 2019 Fixed maturity securities available for sale: Gross realized gains $ 445,749 $ 459,286 Gross realized losses (77,546) (162,649) Other than temporary impairments (370,975) - Equity securities: Gains on securities sold 74,836 256,520 Unrealized gains on securities held at the end of the period 1,125,304 1,086,116 Other assets: Gross realized gains 2,342,418 2,844,673 Gross realized losses (1,984,911) (3,755,579) Total $ 1,554,875 $ 728,367 |
Schedule of Major categories of net investment income | Major categories of net investment income for the years ended December 31, were as follows: 2020 2019 Fixed maturity securities available for sale $ 12,233,394 $ 10,372,559 Equity securities 642,433 309,918 Mortgage loans held for investment 25,672,746 18,405,010 Real estate held for investment and sale 11,945,401 8,782,959 Policy loans 1,025,179 554,969 Insurance assignments 17,837,578 16,086,059 Other investments 126,013 184,439 Cash and cash equivalents 426,623 1,824,443 Gross investment income 69,909,367 56,520,356 Investment expenses (13,579,564) (13,500,883) Net investment income $ 56,329,803 $ 43,019,473 |
Commercial Real Estate Investment | The Company’s commercial real estate held for investment for the years ended December 31, is summarized as follows: Net Ending Balance Total Square Footage 2020 2019 2020 2019 Louisiana $ 2,998,684 $ 6,009,079 84,841 125,114 Mississippi 2,914,498 2,951,478 21,521 21,521 Utah (1) 100,927,528 81,266,083 379,066 465,230 $ 106,840,710 $ 90,226,640 485,428 611,865 (1) Includes Center53 phase 1 and phase 2 which is under construction. The Company’s commercial real estate held for sale for the years ended December 31, is summarized as follows: Net Ending Balance Total Square Footage 2020 2019 2020 2019 Arizona (1) $ - $ 2,500 - - Kansas 4,000,000 4,800,000 222,679 222,679 Mississippi 151,553 318,322 12,300 12,300 Nevada - 655,499 - 4,800 Texas (2) 249,000 300,000 - - $ 4,400,553 $ 6,076,321 234,979 239,779 (1) Undeveloped land (2) Improved commercial pad |
Residential Real Estate Investment | The Company’s residential real estate held for investment for the years ended December 31, is summarized as follows: Net Ending Balance 2020 2019 Florida - 2,487,723 Nevada - 293,516 Utah (1) 24,557,562 9,462,886 Washington (2) 286,181 286,181 $ 24,843,743 $ 12,530,306 (1) Including subdivision land developments (2) Improved residential lots The Company’s residential real estate held for sale for the years ended December 31, is summarized as follows: Net Ending Balance 2020 2019 California - 640,452 Florida 744,322 1,300,641 Nevada 979,640 - Ohio 10,000 10,000 Utah 1,744,292 5,880,213 Washington - 190,000 $ 3,478,254 $ 8,021,306 |
Schedule of subdivision land development | Additional information regarding the Company’s subdivision land developments in Utah for the years ended December 31, is summarized as follows: 2020 2019 Lots available for sale 36 48 Lots to be developed 350 174 Ending Balance (1) $ 23,777,478 $ 7,889,576 (1) The estimated remaining cost to complete the undeveloped lots is $17,354,000 and $1,900,000 as of December 31, 2020 and 2019, respectively. |
Real Estate Owned and Occupied by the Company | As of December 31, 2020, real estate owned and occupied by the Company is summarized as follows: Location Business Segment Approximate Square Footage Square Footage Occupied by the Company 121 W. Election Rd., Draper, UT Corporate Offices, Life Insurance and Cemetery/Mortuary Operations 78,979 18% 5201 Green Street, Salt Lake City, UT (1) Life Insurance and Mortgage Operations 39,157 73% 1044 River Oaks Dr., Flowood, MS Life Insurance Operations 19,694 28% 1818 Marshall Street, Shreveport, LA (1)(2) Life Insurance Operations 12,274 100% 909 Foisy Street, Alexandria, LA (1)(2) Life Insurance Sales 8,059 100% 812 Sheppard Street, Minden, LA (1)(2) Life Insurance Sales 1,560 100% 1550 N 3rd Street, Jena, LA (1)(2) Life Insurance Sales 1,737 100% (1) Included in property and equipment on the consolidated balance sheets (2) See Note 20 regarding the acquisition of Kilpatrick Life Insurance Company |
Schedule of Allowance for loan losses as a contra-asset account | The Company establishes a valuation allowance for credit losses in its portfolio. The following is a summary of the allowance for loan losses as a contra-asset account for the periods presented: Allowance for Credit Losses and Recorded Investment in Mortgage Loans Held for Investment Years Ended December 31 Commercial Residential Residential Construction Total 2020 Allowance for credit losses: Beginning balance $ 187,129 $ 1,222,706 $ 43,202 $ 1,453,037 Charge-offs - - - - Provision - 552,090 - 552,090 Ending balance $ 187,129 $ 1,774,796 $ 43,202 $ 2,005,127 Ending balance: individually evaluated for impairment $ - $ 219,905 $ - $ 219,905 Ending balance: collectively evaluated for impairment $ 187,129 $ 1,554,891 $ 43,202 $ 1,785,222 Mortgage loans: Ending balance $ 46,836,866 $ 111,111,777 $ 95,822,448 $ 253,771,091 Ending balance: individually evaluated for impairment $ 2,148,827 $ 7,932,680 $ 200,963 $ 10,282,470 Ending balance: collectively evaluated for impairment $ 44,688,039 $ 103,179,097 $ 95,621,485 $ 243,488,621 2019 Allowance for credit losses: Beginning balance $ 187,129 $ 1,125,623 $ 35,220 $ 1,347,972 Charge-offs - (32,692) - (32,692) Provision - 129,775 7,982 137,757 Ending balance $ 187,129 $ 1,222,706 $ 43,202 $ 1,453,037 Ending balance: individually evaluated for impairment $ - $ 195,993 $ - $ 195,993 Ending balance: collectively evaluated for impairment $ 187,129 $ 1,026,713 $ 43,202 $ 1,257,044 Mortgage loans: Ending balance $ 38,718,220 $ 113,043,965 $ 89,430,237 $ 241,192,422 Ending balance: individually evaluated for impairment $ 4,488,719 $ 3,752,207 $ 655,000 $ 8,895,926 Ending balance: collectively evaluated for impairment $ 34,229,501 $ 109,291,758 $ 88,775,237 $ 232,296,496 |
Schedule of aging of mortgage loans | Age Analysis of Past Due Mortgage Loans Held for Investment Years Ended December 31 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days (1) In Process of Foreclosure (1) Total Past Due Current Total Mortgage Loans Allowance for Loan Losses Unamortized deferred loan fees, net Unamortized discounts, net Net Mortgage Loans 2020 Commercial $ 233,200 $ 812,780 $ 2,148,827 $ - $ 3,194,807 $ 43,642,059 $ 46,836,866 $ (187,129) $ (32,557) $ (880,721) $ 45,736,459 Residential 5,866,505 2,048,148 5,669,583 2,263,097 15,847,333 79,975,115 95,822,448 (1,774,796) (909,864) (380,175) 92,757,613 Residential Construction 127,191 - - 200,963 328,154 110,783,623 111,111,777 (43,202) (218,711) - 110,849,864 Total $ 6,226,896 $ 2,860,928 $ 7,818,410 $ 2,464,060 $ 19,370,294 $ 234,400,797 $ 253,771,091 $ (2,005,127) $ (1,161,132) $ (1,260,896) $ 249,343,936 2019 Commercial $ 1,872,000 $ - $ 4,488,719 $ - $ 6,360,719 $ 32,357,501 $ 38,718,220 $ (187,129) $ (88,918) $ (653,272) $ 37,788,901 Residential 10,609,296 4,085,767 2,100,742 1,651,465 18,447,270 94,596,695 113,043,965 (1,222,706) (1,567,581) - 110,253,678 Residential Construction - - 655,000 - 655,000 88,775,237 89,430,237 (43,202) (735,068) - 88,651,967 Total $ 12,481,296 $ 4,085,767 $ 7,244,461 $ 1,651,465 $ 25,462,989 $ 215,729,433 $ 241,192,422 $ (1,453,037) $ (2,391,567) $ (653,272) $ 236,694,546 (1) There was not any interest income recognized on loans past due greater than 90 days or in foreclosure. |
Schedule of Impaired Mortgage Loans | The recorded investment in and unpaid principal balance of impaired loans along with the related loan specific allowance for losses, if any, for each reporting period and the average recorded investment and interest income recognized during the time the loans were impaired were as follows: Impaired Loans Years Ended December 31 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized 2020 With no related allowance recorded: Commercial $ 2,148,827 $ 2,148,827 $ - $ 1,866,819 $ - Residential 6,415,419 6,415,419 - 5,010,078 - Residential construction 200,963 200,963 - 555,278 - With an allowance recorded: Commercial $ - $ - $ - $ - $ - Residential 1,517,261 1,517,261 219,905 1,182,368 - Residential construction - - - - - Total: Commercial $ 2,148,827 $ 2,148,827 $ - $ 1,866,819 $ - Residential 7,932,680 7,932,680 219,905 6,192,446 - Residential construction 200,963 200,963 - 555,278 - 2019 With no related allowance recorded: Commercial $ 4,488,719 $ 4,488,719 $ - $ 1,499,043 $ - Residential 2,254,189 2,254,189 - 3,367,151 - Residential construction 655,000 655,000 - 1,457,278 - With an allowance recorded: Commercial $ - $ - $ - $ - $ - Residential 1,498,018 1,498,018 195,993 665,270 - Residential construction - - - - - Total: Commercial $ 4,488,719 $ 4,488,719 $ - $ 1,499,043 $ - Residential 3,752,207 3,752,207 195,993 4,032,421 - Residential construction 655,000 655,000 - 1,457,278 - |
Schedule Of Credit Risk Of Mortgage Loans Based On Performance Status: | The Company’s performing and non-performing mortgage loans held for investment were as follows: Mortgage Loans Held for Investment Credit Exposure Credit Risk Profile Based on Payment Activity Years Ended December 31 Commercial Residential Residential Construction Total 2020 2019 2020 2019 2020 2019 2020 2019 Performing $ 44,688,039 $ 34,229,501 $ 87,889,768 $109,291,758 $ 110,910,814 $ 88,775,237 $ 243,488,621 $ 232,296,496 Non-performing 2,148,827 4,488,719 7,932,680 3,752,207 200,963 655,000 10,282,470 8,895,926 Total $ 46,836,866 $ 38,718,220 $ 95,822,448 $113,043,965 $ 111,111,777 $ 89,430,237 $ 253,771,091 $ 241,192,422 |
Schedule of Mortgage loans on a nonaccrual status | The following is a summary of mortgage loans held for investment on a non-accrual status for the periods presented. Mortgage Loans on Non-accrual Status Years Ended December 31 2020 2019 Commercial $ 2,148,827 $ 4,488,719 Residential 7,932,680 3,752,207 Residential construction 200,963 655,000 Total $ 10,282,470 $ 8,895,926 |
Schedule of principal payments | Expected principal payments may differ from contractual obligations because certain borrowers may elect to pay off mortgage obligations with or without early payment penalties. Principal Principal Principal Amounts Amounts Amounts Due in Due in Due Total 1 Year 2-5 Years Thereafter Residential $ 95,822,448 $ 11,202,899 $ 17,774,238 $ 66,845,311 Residential Construction 111,111,777 $ 103,391,044 $ 7,720,733 - Commercial 46,836,866 27,111,325 11,101,138 8,624,403 Total $ 253,771,091 $ 141,705,268 $ 36,596,109 $ 75,469,714 |
3) Loans Held For Sale (Tables)
3) Loans Held For Sale (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Block Supplement [Abstract] | |
Aggregate fair value - Loans Held for Sale | The following is a summary of the aggregate fair value and the aggregate unpaid principal balance of loans held for sale for the periods presented: As of December 31 2020 As of December 31 2019 Aggregate fair value $ 422,772,418 $ 213,457,632 Unpaid principal balance 406,407,323 206,417,122 Unrealized gain 16,365,095 7,040,510 |
Schedule of Mortgage Fee Income for Loans Held for Sale | Major categories of mortgage fee income for loans held for sale for the years ended December 31, were as follows: 2020 2019 Loan fees $ 43,432,532 $ 28,660,966 Interest income 10,628,581 6,978,930 Secondary gains 231,759,342 93,581,956 Change in fair value of loan commitments 7,637,377 899,417 Change in fair value of loans held for sale 10,413,492 2,498,097 Provision for loan loss reserve (4,938,214) (643,284) Mortgage fee income $ 298,933,110 $ 131,976,082 |
Schedule of loan loss reserve which is included in other liabilities and accrued expenses | The following is a summary of the loan loss reserve which is included in other liabilities and accrued expenses: December 31 2020 2019 Balance, beginning of period $ 4,046,288 $ 3,604,869 Provision for current loan originations (1) 4,938,214 643,284 Additional provision for loan loss reserve 16,506,030 - Charge-offs, net of recaptured amounts (4,906,914) (201,865) Balance, at December 31 $ 20,583,618 $ 4,046,288 (1) Included in Mortgage fee income |
4) Receivables (Tables)
4) Receivables (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Receivables [Abstract] | |
Schedule of Receivables | Receivables consist of the following: December 31 2020 2019 Trade contracts $ 4,119,988 $ 2,795,471 Receivables from sales agents 2,677,774 2,962,571 Other 5,786,827 5,202,444 Total receivables 12,584,589 10,960,486 Allowance for doubtful accounts (1,685,382) (1,724,156) Net receivables $ 10,899,207 $ 9,236,330 |
5) Value of Business Acquired_2
5) Value of Business Acquired, Intangible Assets and Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Value of Business Acquired | Information with regard to value of business acquired was as follows: December 31 2020 2019 Balance at beginning of year $ 9,876,647 $ 5,765,190 Value of business acquired - 4,962,831 (1) Imputed interest at 7% included in earnings 670,565 472,916 Amortization included in earnings (1,457,390) (1,320,456) Shadow amortization included in other (134,573) (3,834) Net amortization (921,398) (851,374) Balance at end of year $ 8,955,249 $ 9,876,647 (1) See Note 20 regarding the acquisition of Kilpatrick Life Insurance Company |
Schedule of Carrying Value of Intangible Asset | The carrying value of the Company’s intangible assets were as follows : December 31 Useful Life 2020 2019 Intangible asset - customer lists 15 years $ 890,000 $ 890,000 Intangible asset - trade name (1) 15 years $ 610,000 $ 610,000 Less accumulated amortization (197,334) (98,222) Balance at end of year $ 1,302,666 $ 1,401,778 (1) See Note 20 regarding the acquisition of Kilpatrick Life Insurance Company |
Schedule of Goodwill by Segment | Information regarding goodwill by segment was as follows: Life Insurance Cemetery/Mortuary Total Balance at January 1, 2019: Goodwill $ 2,765,570 $ - $ 2,765,570 Accumulated impairment - - - Total goodwill, net 2,765,570 - 2,765,570 Acquisition - 754,018 (1) 754,018 Balance at December 31, 2019: Goodwill 2,765,570 754,018 3,519,588 Accumulated impairment - - - Total goodwill, net 2,765,570 754,018 3,519,588 Acquisition - - - Balance at December 31, 2020: Goodwill 2,765,570 754,018 3,519,588 Accumulated impairment - - - Total goodwill, net $ 2,765,570 $ 754,018 $ 3,519,588 (1) See Note 20 regarding the acquisition of Probst Family Funerals and Cremations and Heber Valley Funeral Home |
6) Property and Equipment (Tabl
6) Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | The cost of property and equipment is summarized below: December 31 2020 2019 Land and buildings $ 11,972,802 $ 15,131,301 Furniture and equipment 19,679,682 18,987,984 31,652,484 34,119,285 Less accumulated depreciation (19,179,139) (19,518,891) Total $ 12,473,345 $ 14,600,394 |
7) Bank and Other Loans Payab_2
7) Bank and Other Loans Payable (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Summary of Bank Loans Payable | Bank and other loans payable are summarized as follows: December 31 2020 2019 2.25% above the monthly LIBOR rate plus 1/16th of the monthly LIBOR rate note payable in $ - $ 2,659,769 4.27% fixed note payable in monthly installments of $53,881 including principal and interest, 633,890 1,238,619 Prime rate note payable in monthly installments of $75,108 including principal and interest, 3,257,113 4,000,000 4.40% fixed note payable in monthly installments of $46,825 including principal and interest, - 7,247,651 4.329% fixed note payable in monthly installments of $9,775 including principal and interest, 1,861,920 1,896,450 2.5% above the monthly LIBOR rate plus 1/16th of the monthly LIBOR rate construction loan 35,091,364 33,811,559 4.7865% fixed interest only note payable in monthly installments, collateralized by real property 9,200,000 9,200,000 1 month LIBOR rate plus 2.1% loan purchase agreement with a warehouse line availability of 116,598,834 88,509,536 1 month LIBOR rate plus 3% loan purchase agreement with a warehouse line availability of 68,766,572 67,537,600 1 month LIBOR rate plus 2.5% loan purchase agreement with a warehouse line availability of 60,715,374 - 1 month LIBOR rate plus 2.5% loan purchase agreement with a warehouse line availability of 317,582 - Other short-term borrowings (1) 1,250,000 1,250,000 Finance lease liabilities 104,951 153,439 Other loans payable 26,768 67,989 Total bank and other loans 297,824,368 217,572,612 Less current installments 284,250,996 192,985,602 Bank and other loans, excluding current installments $ 13,573,372 $ 24,587,010 (1) Revolving Line of Credit |
Schedule of combined maturities of bank loans payable, lines of credit and notes and contracts payable | The following tabulation shows the combined maturities of bank and other loans payable: 2021 $ 284,242,327 2022 884,383 2023 926,186 2024 937,315 2025 1,634,157 Thereafter 9,200,000 Total $ 297,824,368 |
8) Cemetery Perpetual Care Tr_2
8) Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Schedule of the components of the cemetery perpetual care obligation | The components of the cemetery perpetual care investments and obligation are as follows: December 31 2020 2019 Cash and cash equivalents $ 402,913 $ 1,306,740 Fixed maturity securities, available for sale, at estimated fair value 747,767 975,673 Equity securities, at estimated fair value 2,062,303 1,605,451 Commerical mortgage loans held for investment - 524,000 Participating interests in residential construction mortgage loans 1,468,600 - Real estate held for investment 1,731,584 - Note receivables from Cottonwood Mortuary, Singing Hills Cemetery and Memorial Estates eliminated in consolidation - 1,541,120 Total cemetery perpetual care trust investments 6,413,167 5,952,984 Cemetery perpetual care obligation (4,087,704) (3,933,719) Trust investments in excess of trust obligations $ 2,325,463 $ 2,019,265 |
Schedule of Restricted Assets in Cemetery and Mortuary Endowment Care and Pre need Merchandise Funds | Restricted assets are summarized as follows: December 31 2020 2019 Cash and cash equivalents (1) $ 8,842,744 $ 8,674,214 Fixed maturity securities, available for sale, at estimated fair value 1,473,637 1,008,867 Equity securities, at estimated fair value 2,515,778 1,976,480 Participating interests in mortgage loans held for investment 3,317,877 2,275,756 Total $ 16,150,036 $ 13,935,317 (1) Including cash and cash equivalents of $8,524,999 and $7,170,092 as of December 31, 2020 and 2019, respectively, for the life insurance and mortgage segments. |
9) Income Taxes (Tables)
9) Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
Summary of Income Tax Liability | The Company’s income tax liability is summarized as follows: December 31 2020 2019 Current $ 2,595,877 $ 1,410,153 Deferred 22,662,923 17,276,819 Total $ 25,258,800 $ 18,686,972 |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax (assets) and liabilities are approximately as follows: December 31 2020 2019 Assets Future policy benefits $ (12,657,045) $ (12,450,229) Loan loss reserve (5,352,942) (1,053,256) Unearned premium (699,011) (760,556) Net operating loss (334,085) (438,420) Deferred compensation (2,833,298) (1,996,865) Deposit obligations (610,041) (619,633) Other (1,269,533) (1,020,718) Less: Valuation allowance 961,920 2,439,394 Total deferred tax assets (22,794,035) (15,900,283) Liabilities Deferred policy acquisition costs 16,430,001 15,536,717 Basis difference in property, equipment and real estate 5,312,787 3,638,512 Value of business acquired 1,880,602 2,074,096 Deferred gains 12,124,226 5,169,104 Trusts 1,064,387 1,064,387 Tax on unrealized appreciation 8,644,955 5,694,286 Total deferred tax liabilities 45,456,958 33,177,102 Net deferred tax liability $ 22,662,923 $ 17,276,819 |
Schedule of Components of Income Tax Expense (Benefit) | The Company’s income tax expense is summarized as follows for the years ended December 31: 2020 2019 Current Federal $ 10,678,612 $ 4,404,041 State 2,320,233 504,272 12,998,845 4,908,313 Deferred Federal 2,677,943 (1,551,725) State 176,726 (306,172) 2,854,669 (1,857,897) Total $ 15,853,514 $ 3,050,416 |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of income tax expense at the U.S. federal statutory rates is as follows: 2020 2019 Computed expense at statutory rate $ 15,004,527 $ 2,928,226 State tax expense, net of federal tax benefit 1,972,598 156,499 Change in valuation allowance (1,477,474) 194,364 Other, net 353,863 (228,673) Income tax expense $ 15,853,514 $ 3,050,416 |
Summary of Operating Loss Carryforwards | Net Operating Losses and Tax Credit Carryforwards: Year of Expiration 2021 $ 17,100 2022 - 2023 - 2024 - 2025 - Thereafter up through 2037 1,405,155 $ 1,422,255 |
12) Capital Stock (Tables)
12) Capital Stock (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Earnings per share amounts have been retroactively adjusted for the effect of annual stock dividends. In accordance with GAAP, the basic and diluted earnings per share amounts were calculated as follows: 2020 2019 Numerator: Net earnings $ 55,596,613 $ 10,893,519 Denominator: Denominator for basic earnings per share-weighted-average shares 18,831,991 18,562,056 Effect of dilutive securities Employee stock options 443,260 127,608 Dilutive potential common shares 443,260 127,608 Denominator for diluted earnings per share-adjusted weighted-average shares and assumed conversions 19,275,251 18,689,664 Basic earnings per share $2.95 $0.59 Diluted earnings per share $2.88 $0.58 |
13) Stock Compensation Plans (T
13) Stock Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Block Supplement [Abstract] | |
Schedule of Assumptions Used | The following table summarizes the assumptions used in estimating the fair value of each option granted along with the weighted-average fair value of the options granted: Assumptions Grant Date Plan Weighted-Average Fair Value of Each Option Expected Dividend Yield Underlying stock FMV Weighted-Average Volatility Weighted-Average Risk-Free Interest Rate Weighted-Average Expected Life (years) March 27, 2020 All Plans $ 0.65 5% $ 3.76 32.29% 1.64% 4.82 December 6, 2019 All Plans $ 0.96 5% $ 5.19 32.79% 1.64% 4.83 January 17, 2019 All Plans $ 1.12 5% $ 4.98 36.04% 2.56% 5.31 |
Schedule of Activity of Stock Option Plans | Activity of the stock option plans is summarized as follows: Number of Weighted Average Exercise Price Number of Weighted Average Exercise Price Outstanding at January 1, 2019 1,011,274 $ 4.49 577,280 $ 5.15 Adjustment for the effect of stock dividends 51,018 28,295 Granted 81,000 180,000 Exercised (45,834) (191,443) Cancelled (11,405) - Outstanding at December 31, 2019 1,086,053 $ 4.41 594,132 $ 5.36 Adjustment for the effect of stock dividends 27,968 19,354 Granted 77,000 180,000 Exercised (116,487) (130,820) Cancelled (1,671) - Outstanding at December 31, 2020 1,072,863 $ 4.33 662,666 $ 4.73 Exercisable at end of year 1,053,903 $ 4.45 616,542 $ 4.91 Available options for future grant 325,372 266,500 Weighted average contractual term of options outstanding at December 31, 2020 5.50 years 6.71 years Weighted average contractual term of options exercisable at December 31, 2020 5.43 years 6.63 years Aggregated intrinsic value of options outstanding at December 31, 2020 (1) $4,311,983 $2,396,954 Aggregated intrinsic value of options exercisable at December 31, 2020 (1) $4,223,251 $2,183,399 (1) The Company used a stock price of $8.35 as of December 31, 2020 to derive intrinsic value. |
14) Statutory Financial Infor_2
14) Statutory Financial Information and Dividend Limitations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
Schedule of statutory accounting practices | Statutory net income and capital and surplus of the Company’s insurance subsidiaries, determined in accordance with statutory accounting practices prescribed or permitted by insurance regulatory authorities are as follows: Statutory Net Income Statutory Capital and Surplus 2020 2019 2020 2019 Amounts by insurance subsidiary: Security National Life Insurance Company $ 6,054,764 $ 3,589,552 $ 53,089,185 $ 49,390,181 Kilpatrick Life Insurance Company 1,574,128 12,752,100 (1) 15,177,996 15,208,071 First Guaranty Insurance Company 790,221 1,078,733 7,045,644 6,352,670 Memorial Insurance Company of America 55 (107) 1,088,034 1,088,559 Southern Security Life Insurance Company, Inc. 183 87 1,581,647 1,588,396 Trans-Western Life Insurance Company (1,527) 3,773 510,636 512,163 Total $ 8,417,824 $17,424,138 $ 78,493,142 $ 74,140,040 (1) Includes 12 months even though Kilpatrick Life Insurance Company wasn't acquired by the Company until December 2019. |
15) Business Segments Informati
15) Business Segments Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Block Supplement [Abstract] | |
Schedule of Revenues and Expenses by Reportable Segment | The Company regularly reviews the quantitative thresholds and other criteria to determine when other business segments may need to be reported. 2020 Life Cemetery/ Intercompany Insurance Mortuary Mortgage Eliminations Consolidated Revenues: From external sources: Revenue from customers $ 93,020,617 $ 20,307,435 $ 298,933,110 $ - $ 412,261,162 Net investment income 54,811,486 807,695 710,622 - 56,329,803 Gains on investments and other assets 2,088,541 (162,652) (39) - 1,925,850 Other than temporary impairments (370,975) - - - (370,975) Other revenues 1,491,585 94,349 9,731,548 - 11,317,482 Intersegment revenues: Net investment income 8,022,503 351,505 716,240 (9,090,248) - Total revenues 159,063,757 21,398,332 310,091,481 (9,090,248) 481,463,322 Expenses: Death, surrenders and other policy benefits 62,841,360 - - - 62,841,360 Increase in future policy benefits 23,568,650 - - - 23,568,650 Amortization of deferred policy and pre-need acquisition costs and value of business acquired 13,618,204 689,221 - - 14,307,425 Selling, general and administrative expenses: Commissions 4,149,241 1,506,320 118,770,736 - 124,426,297 Personnel 25,449,100 5,669,367 53,871,504 - 84,989,971 Advertising 614,114 391,836 4,374,946 - 5,380,896 Rent and rent related 861,602 89,253 5,922,706 - 6,873,561 Depreciation on property and equipment 843,335 488,570 746,833 - 2,078,738 Provision for loan loss reserve - - 16,506,030 - 16,506,030 Cost related to funding mortgage loans - - 9,877,700 - 9,877,700 Intersegment 621,161 142,999 580,976 (1,345,136) - Other 11,808,818 4,417,805 31,104,479 - 47,331,102 Interest expense: Intersegment 410,024 152,175 7,182,913 (7,745,112) - Other 2,354,760 198,968 6,025,082 - 8,578,810 Costs of goods and services sold-mortuaries and cemeteries - 3,252,655 - - 3,252,655 Total benefits and expenses 147,140,369 16,999,169 254,963,905 (9,090,248) 410,013,195 Earnings before income taxes $ 11,923,388 $ 4,399,163 $ 55,127,576 $ - $ 71,450,127 Income tax benefit (expense) (1,433,901) (1,009,137) (13,410,476) - (15,853,514) Net earnings $ 10,489,487 $ 3,390,026 $ 41,717,100 $ - $ 55,596,613 Identifiable assets $ 1,171,158,235 $ 56,335,498 $ 408,325,196 $ (90,398,039) $ 1,545,420,890 Goodwill $ 2,765,570 $ 754,018 $ - $ - $ 3,519,588 2019 Life Cemetery/ Intercompany Insurance Mortuary Mortgage Eliminations Consolidated Revenues: From external sources: Revenue from customers $ 81,860,610 $ 15,296,235 $ 131,976,082 $ - $ 229,132,927 Net investment income 41,610,831 579,995 828,647 - 43,019,473 Gains on investments and other assets 138,330 530,098 59,939 - 728,367 Other revenues 2,128,961 95,197 7,956,005 - 10,180,163 Intersegment revenues: Net investment income 4,455,034 443,548 508,637 (5,407,219) - Total revenues 130,193,766 16,945,073 141,329,310 (5,407,219) 283,060,930 Expenses: Death, surrenders and other policy benefits 44,911,805 - - - 44,911,805 Increase in future policy benefits 23,568,497 - - - 23,568,497 Amortization of deferred policy and pre-need acquisition costs and value of business acquired 14,199,152 435,425 - - 14,634,577 Selling, general and administrative expenses: Commissions 3,632,780 1,084,079 52,046,032 - 56,762,891 Personnel 20,311,591 5,177,810 38,731,869 - 64,221,270 Advertising 595,118 368,173 3,821,267 - 4,784,558 Rent and rent related 451,380 47,525 6,556,551 - 7,055,456 Depreciation on property and equipment 477,247 428,633 805,489 - 1,711,369 Cost related to funding mortgage loans - - 6,278,954 - 6,278,954 Intersegment 412,853 180,594 544,463 (1,137,910) - Other 11,769,097 3,241,023 19,912,641 - 34,922,761 Interest expense: Intersegment 490,756 154,615 3,623,938 (4,269,309) - Other 2,808,081 288,768 4,289,839 - 7,386,688 Costs of goods and services sold-mortuaries and cemeteries - 2,878,169 - - 2,878,169 Total benefits and expenses 123,628,357 14,284,814 136,611,043 (5,407,219) 269,116,995 Earnings before income taxes $ 6,565,409 $ 2,660,259 $ 4,718,267 $ - $ 13,943,935 Income tax benefit (expense) (1,085,848) (649,144) (1,315,424) - (3,050,416) Net earnings $ 5,479,561 $ 2,011,115 $ 3,402,843 $ - $ 10,893,519 Identifiable assets $ 1,110,641,526 $ 81,014,182 $ 249,970,323 $ (110,701,544) $ 1,330,924,487 Goodwill $ 2,765,570 $ 754,018 $ - $ - $ 3,519,588 |
17) Fair Value of Financial I_2
17) Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Block Supplement [Abstract] | |
Schedule of fair value assets and liabilities measured on a recurring basis | The following table summarizes Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a recurring basis by their classification in the consolidated balance sheet at December 31, 2020. Total Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Assets accounted for at fair value on a Fixed maturity securities available for sale $ 294,656,679 $ - $ 292,455,504 $ 2,201,175 Equity securities 11,324,239 11,324,239 - - Loans held for sale 422,772,418 - - 422,772,418 Restricted assets (1) 1,473,637 - 1,473,637 - Restricted assets (2) 2,515,778 2,515,778 - - Cemetery perpetual care trust investments (1) 747,767 - 747,767 - Cemetery perpetual care trust investments (2) 2,062,303 2,062,303 - - Derivatives - loan commitments (3) 12,592,672 - - 12,592,672 Total assets accounted for at fair value on a $ 748,145,493 $ 15,902,320 $ 294,676,908 $ 437,566,265 Liabilities accounted for at fair value on a Derivatives - call options (4) $ (43,097) $ (43,097) $ - $ - Derivatives - loan commitments (4) (2,464,062) - - (2,464,062) Total liabilities accounted for at fair value $ (2,507,159) $ (43,097) $ - $ (2,464,062) (1) Fixed maturity securities available for sale (2) Equity securities (3) Included in other assets on the consolidated balance sheets (4) Included in other liabilities and accrued expenses on the consolidated balance sheets The following table summarizes Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a recurring basis by their classification in the consolidated balance sheet at December 31, 2019. Total Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Assets accounted for at fair value on a Fixed maturity securities available for sale $ 355,977,820 $ - $ 352,761,438 $ 3,216,382 Equity securities 7,271,165 7,271,165 - - Loans held for sale 213,457,632 - - 213,457,632 Restricted assets (1) 1,008,867 - 1,008,867 - Restricted assets (2) 1,976,480 1,976,480 - - Cemetery perpetual care trust investments (1) 975,673 - 975,673 - Cemetery perpetual care trust investments (2) 1,605,451 1,605,451 - - Derivatives - loan commitments (3) 2,722,580 - - 2,722,580 Total assets accounted for at fair value on a $ 584,995,668 $ 10,853,096 $ 354,745,978 $ 219,396,594 Liabilities accounted for at fair value on a Derivatives - call options (4) $ (62,265) $ (62,265) $ - $ - Derivatives - put options (4) (22,282) (22,282) - - Derivatives - loan commitments (4) (231,347) - - (231,347) Total liabilities accounted for at fair value $ (315,894) $ (84,547) $ - $ (231,347) (1) Fixed maturity securities available for sale (2) Mutual funds and equity securities (3) Included in other assets on the consolidated balance sheets (4) Included in other liabilities and accrued expenses on the consolidated balance sheets |
Schedule of Effect of Significant Unobservable Inputs, Changes in Plan Assets | For Level 3 assets and liabilities measured at fair value on a recurring basis as of December 31, 2020, the significant unobservable inputs used in the fair value measurements were as follows: Significant Range of Inputs Fair Value at Valuation Unobservable Minimum Maximum Weighted 12/31/2020 Technique Input(s) Value Value Average Loans held for sale $422,772,418 Market approach Investor contract pricing as a percentage of unpaid principal balance 99.0% 110.0% 104.0% Derivatives - loan commitments (net) 10,128,610 Market approach Pull-through rate 52.0% 92.0% 81.0% Initial-Value N/A N/A N/A Servicing 0 bps 184 bps 58 bps Fixed maturity securities available for sale 2,201,175 Broker quotes Pricing quotes $ 90.83 $ 119.33 $ 113.47 For Level 3 assets and liabilities measured at fair value on a recurring basis as of December 31, 2019, the significant unobservable inputs used in the fair value measurements were as follows: Significant Range of Inputs Fair Value at Valuation Unobservable Minimum Maximum Weighted 12/31/2019 Technique Input(s) Value Value Average Loans held for sale $213,457,632 Market approach Investor contract pricing as a percentage of unpaid principal balance 98.0% 109.0% 103.0% Derivatives - loan commitments (net) 2,491,233 Market approach Pull-through rate 1.0% 92.0% 81.0% Initial-Value N/A N/A N/A Servicing 0 bps 318 bps 79 bps Fixed maturity securities available for sale 3,216,382 Broker quotes Pricing quotes $ 95.02 $ 115.80 $ 107.98 |
Schedule of Changes in the consolidated balance sheet line items measured using level 3 inputs | Following is a summary of changes in the consolidated balance sheet line items measured using level 3 inputs: Net Derivatives Loan Commitments Loans Held for Sale Fixed Maturity Securities Available for Sale Balance - December 31, 2019 $ 2,491,233 $ 213,457,632 $ 3,216,382 Originations/purchases - 5,627,013,749 - Sales, maturities and paydowns - (5,600,045,285) (1,042,400) Transfer to mortgage loans held for investment - (16,960,549) - Total gains (losses): Included in earnings 7,637,377 (1) 199,306,871 (1) 3,408 (2) Included in other comprehensive income - - 23,785 Balance - December 31, 2020 $ 10,128,610 $ 422,772,418 $ 2,201,175 (1) As a component of mortgage fee income on the consolidated statements of earnings (2) As a component of net investment income on the consolidated statements of earnings Following is a summary of changes in the consolidated balance sheet line items measured using level 3 inputs: Net Derivatives Loan Commitments Loans Held for Sale Fixed Maturity Securities Available for Sale Balance - December 31, 2018 $ 1,591,816 $ 136,210,853 $ - Originations/purchases - 2,606,839,175 - Sales, maturities and paydowns - (2,580,875,055) - Transfer to mortgage loans held for investment - (31,881,851) - Transfer from fixed maturity securities held to maturity - 3,216,382 Total gains (losses): Included in earnings (1) 899,417 83,164,510 - Balance - December 31, 2019 $ 2,491,233 $ 213,457,632 $ 3,216,382 (1) As a component of mortgage fee income on the consolidated statements of earnings |
Fair Value Assets Measured on a Nonrecurring Basis | The following tables summarize Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a nonrecurring basis by their classification in the consolidated balance sheet at December 31, 2020. Total Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Assets accounted for at fair value on a Impaired mortgage loans held for investment $ 1,297,356 $ - $ - $ 1,297,356 Impaired real estate held for sale 4,249,000 - - 4,249,000 Total assets accounted for at fair value on $ 5,546,356 $ - $ - $ 5,546,356 The following tables summarize Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a nonrecurring basis by their classification in the consolidated balance sheet at December 31, 2019. Total Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Assets accounted for at fair value on a Impaired mortgage loans held for investment $ 1,302,025 $ - $ - $ 1,302,025 Impaired real estate held for investment 8,375,884 - - 8,375,884 Total assets accounted for at fair value on $ 9,677,909 $ - $ - $ 9,677,909 |
Schedule of Financial Instruments Carried at Other Than Fair Value | The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows as of December 31, 2020: Carrying Value Level 1 Level 2 Level 3 Total Estimated Fair Value Assets Mortgage loans held for investment Residential $ 92,757,613 $ - $ - $ 100,384,283 $ 100,384,283 Residential construction 110,849,864 - - 110,849,864 110,849,864 Commercial 45,736,459 - - 45,259,425 45,259,425 Mortgage loans held for investment, net $ 249,343,936 $ - $ - $ 256,493,572 $ 256,493,572 Policy loans 14,171,589 - - 14,171,589 14,171,589 Insurance assignments, net (1) 51,585,656 - - 51,585,656 51,585,656 Restricted assets (2) 3,317,877 - - 3,317,877 3,317,877 Cemetery perpetual care trust investments (2) 1,468,600 - - 1,468,600 1,468,600 Mortgage servicing rights, net 35,210,516 - - 38,702,358 38,702,358 Liabilities Bank and other loans payable $(297,824,368) $ - $ - $ (297,824,368) $ (297,824,368) Policyholder account balances (3) (44,026,809) - - (42,220,725) (42,220,725) Future policy benefits - annuities (3) (106,522,113) - - (112,354,186) (112,354,186) (1) Included in other investments and policy loans on the consolidated balance sheets (2) Mortgage loans held for investment (3) Included in future policy benefits and unpaid claims on the consolidated balance sheets The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows as of December 31, 2019: Carrying Value Level 1 Level 2 Level 3 Total Estimated Fair Value Assets Mortgage loans held for investment Residential $ 110,253,678 $ - $ - $ 115,320,638 $ 115,320,638 Residential construction 88,651,967 - - 88,651,967 88,651,967 Commercial 37,788,901 - - 39,289,462 39,289,462 Mortgage loans held for investment, net 236,694,546 $ - $ - $ 243,262,067 $ 243,262,067 Policy loans 14,762,805 - - 14,762,805 14,762,805 Insurance assignments, net (1) 39,614,939 - - 39,614,939 39,614,939 Restricted assets (2) 2,275,756 - - 2,289,679 2,289,679 Cemetery perpetual care trust investments (2) 524,000 - - 536,553 536,553 Mortgage servicing rights, net 17,155,529 - - 22,784,571 22,784,571 Liabilities Bank and other loans payable $ (217,572,612) $ - $ - $ (217,572,612) $ (217,572,612) Policyholder account balances (3) (45,154,180) - - (41,828,469) (41,828,469) Future policy benefits - annuities (3) (113,579,830) - - (117,304,614) (117,304,614) (1) Included in other investments and policy loans on the consolidated balance sheets (2) Mortgage loans held for investment (3) Included in future policy benefits and unpaid claims on the consolidated balance sheets |
18) Accumulated Other Compreh_2
18) Accumulated Other Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Schedule of Changes in accumulated other comprehensive income | The following summarizes the changes in accumulated other comprehensive income: December 31 2020 2019 Unrealized gains on fixed maturity securities available for sale $ 12,016,464 $ 17,315,770 Amounts reclassified into net earnings (2,772) - Net unrealized gains before taxes 12,013,692 17,315,770 Tax expense (2,522,876) (3,636,311) Net 9,490,816 13,679,459 Unrealized gains on restricted assets (1) 41,225 35,550 Tax expense (10,269) (8,856) Net 30,956 26,694 Unrealized gains on cemetery perpetual care trust investments (1) (6,817) 29,904 Tax expense 1,698 (7,449) Net (5,119) 22,455 Unrealized gains for foreign currency translations adjustments (46) 972 Tax expense 12 (243) Net (34) 729 Other comprehensive income changes $ 9,516,619 $ 13,729,337 _______________ (1) Fixed maturity securities available for sale |
Accumulated Balances of Other Comprehensive Income | The following is the accumulated balances of other comprehensive income as of December 31, 2020: Beginning Balance December 31, 2019 Change for the period Ending Balance December 31, Unrealized gains on fixed maturity securities available for sale $ 13,679,459 $ 9,490,816 $ 23,170,275 Unrealized gains on restricted assets (1) 26,694 30,956 57,650 Unrealized gains (losses) on cemetery perpetual 22,455 (5,119) 17,336 Foreign currency translation adjustments (2,094) (34) (2,128) Other comprehensive income $ 13,726,514 $ 9,516,619 $ 23,243,133 (1) Fixed maturity securities available for sale The following is the accumulated balances of other comprehensive income as of December 31, 2019: Beginning Balance December 31, 2018 Change for the period Ending Balance December 31, Unrealized gains on fixed maturity securities available for sale $ - $ 13,679,459 $ 13,679,459 Unrealized gains on restricted assets (1) - 26,694 26,694 Unrealized gains on cemetery perpetual care trust investments (1) - 22,455 22,455 Foreign currency translation adjustments (2,823) 729 (2,094) Other comprehensive income (loss) $ (2,823) $ 13,729,337 $ 13,726,514 (1) Fixed maturity securities available for sale |
19) Derivative Instruments (Tab
19) Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Block Supplement [Abstract] | |
Schedule of Derivative Assets at Fair Value | The following table shows the fair value and notional amounts of derivative instruments as of December 31, 2020 and 2019. Fair Values and Notional Amounts of Derivative Instruments December 31, 2020 December 31, 2019 Balance Sheet Location Notional Amount Asset Fair Value Liability Fair Value Notional Amount Asset Fair Value Liability Fair Value Derivatives not designated as hedging instruments: Loan commitments Other assets and Other liabilities $659,245,038 $12,592,672 $2,464,062 $224,202,514 $2,722,580 $231,347 Call options Other liabilities 1,873,200 -- 43,097 1,813,500 -- 62,265 Put options Other liabilities -- -- -- 1,573,100 -- 22,282 Total $661,118,238 $12,592,672 $2,507,159 $227,589,114 $2,722,580 $315,894 |
Schedule of Gains and Losses on Derivatives | The following table shows the gain (loss) on derivatives for the periods presented. There were no gains or losses reclassified from accumulated other comprehensive income into income or gains or losses recognized in income on derivatives ineffective portion or any amounts excluded from effective testing. Net Amount Gain (Loss) Years ended December 31 Derivative Classification 2020 2019 Loan commitments Mortgage fee income $ 7,637,377 $ 899,417 Call and put options Gains on investments and other assets $ 272,758 $ 626,208 |
20) Acquisitions (Tables)
20) Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Probst Family Funerals and Cremations and Heber Valley Funeral Home | |
Estimated Fair Values of Assets Acquired and Liabilities Assumed | The estimated fair values of the assets acquired and liabilities assumed as of the date of acquisition were as follows: Cash $ 53,859 Property and equipment 2,475,526 Receivables 13,620 Goodwill 754,018 Other 21,800 Total assets acquired 3,318,823 Bank and other loans payable (3,176) Total liabilities assumed (3,176) Fair value of net assets acquired/consideration paid $ 3,315,647 Fair value of net assets acquired/consideration paid, net of cash acquired $ 3,261,788 |
Kilpatrick | |
Estimated Fair Values of Assets Acquired and Liabilities Assumed | As part of the coinsurance agreement, effective October 1, 2019, Security National Life acquired the following assets and assumed the following contractual liabilities. Other investments and policy loans $ 9,124,459 Real estate held for investment 2,850,000 Mortgage loans held for investment 200,000 Receivables 131,258 Total assets acquired 12,305,717 Future policy benefits and unpaid claims (165,404,970) Other liabilities and accrued expenses (5,259,341) Total liabilities assumed (170,664,311) Cash received for reinsurance assumed $ 158,358,594 At the time of acquisition some of these assets and liabilities became intercompany items, and the Company has eliminated them for consolidation. Fixed maturity securities, available for sale $ 22,766,520 Fixed maturity securities, held to maturity 16,436 Mortgage loans held for investment 8,011,660 Real estate held for investment 2,708,557 Other investments 446,655 Accrued investment income 183,527 Total investments 34,133,355 Cash and cash equivalents 6,900,654 Receivables, net 5,407,736 (1) Receivables from reinsurers 168,105,064 (1) Property and equipment, net 1,498,245 Value of business acquired 4,962,831 Deferred taxes 167,344 Other 712,323 Total assets acquired 221,887,552 Future policy benefits and unpaid claims (189,071,407) Accounts payable (283,304) Other liabilities and accrued expenses (7,870,944) Income taxes (881,957) Total liabilities assumed (198,107,612) Fair value of net assets acquired/consideration paid $ 23,779,940 Fair value of net assets acquired/consideration paid, net of cash acquired $ 16,879,286 (1) Receivable from reinsurers of $162,907,008 and receivables, net of $5,000,000 were settled with the recapture of the coinsurance agreement by Kilpatrick Life from Security National Life. |
21) Mortgage Servicing Rightss
21) Mortgage Servicing Rightss (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Block Supplement [Abstract] | |
Schedule of Mortgage Servicing Rights | The following table presents the MSR activity for the periods presented. December 31 2020 2019 Amortized cost: Balance before valuation allowance at beginning of year $ 17,155,529 $ 20,016,822 MSR additions resulting from loan sales 29,896,465 4,194,502 Amortization (1) (11,841,478) (7,055,795) Application of valuation allowance to write down MSRs - - Balance before valuation allowance at year end $ 35,210,516 $ 17,155,529 Valuation allowance for impairment of MSRs: Balance at beginning of year $ - $ - Additions - - Application of valuation allowance to write down MSRs - - Balance at year end $ - $ - Mortgage servicing rights, net $ 35,210,516 $ 17,155,529 Estimated fair value of MSRs at year end $ 38,702,358 $ 22,784,571 (1) Included in other expenses on the consolidated statements of earnings |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense, Mortgage Servicing Rights | Therefore, the following estimates will change in a manner and amount not presently determinable by management. Estimated MSR Amortization 2021 $ 4,724,439 2022 3,582,811 2023 3,030,850 2024 2,574,323 2025 2,200,840 Thereafter 19,097,253 Total $ 35,210,516 |
Schedule of Other Revenues | During the years ended December 31, 2020 and 2019, the Company collected the following contractual servicing fee income and late fee income as reported in other revenues on the consolidated statements of earnings: 2020 2019 Contractual servicing fees $ 8,940,612 $ 7,212,164 Late fees 305,962 365,477 Total $ 9,246,574 $ 7,577,641 |
Summary of Unpaid Principal Balances of the Servicing Portfolio | The following is a summary of the unpaid principal balances (“UPB”) of the servicing portfolio for the periods presented: Years Ended December 31 2020 2019 Servicing UPB $ 5,070,287,864 $ 2,804,139,415 |
Assumptions used in determining MSR value | The following key assumptions were used in determining MSR value: Prepayment Average Discount December 31, 2020 15.60 5.30 9.50 December 31, 2019 15.30 5.27 9.51 |
22) Future Policy Benefits an_2
22) Future Policy Benefits and Unpaid Claims (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Insurance [Abstract] | |
Schedule of Liability for Future Policy Benefits, by Product Segment | The following table provides information regarding future policy benefits and unpaid claims and the related receivable from reinsurers. Years Ended 2020 2019 Life $ 674,230,463 $654,585,723 Annuities 109,522,112 113,579,831 Policyholder account balances 44,026,809 45,154,180 Accident and health 651,140 667,428 Other policyholder funds 4,354,746 4,530,227 Reported but unpaid claims 8,689,723 4,891,922 Incurred but not reported claims 3,315,094 2,191,607 Gross future policy benefits and unpaid claims $ 844,790,087 $825,600,918 Receivable from reinsurers Life 10,841,567 11,040,398 Annuities 4,047,301 4,038,007 Accident and health 90,231 90,113 Reported but unpaid claims 571,057 569,250 Incurred but not reported claims 19,000 10,000 Total receivable from reinsurers 15,569,156 15,747,768 Net future policy benefits and unpaid claims $ 829,220,931 $809,853,150 |
23) Revenues From Contracts W_2
23) Revenues From Contracts With Customers (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Block Supplement [Abstract] | |
Schedule of Opening and Closing Balances of Receivables, Contract Assets and Contract Liabilities | The opening and closing balances of the Company’s receivables, contract assets and contract liabilities are as follows: Contract Balances Receivables (1) Contract Asset Contract Liability Opening (1/1/2020) $ 2,778,879 $ - $ 12,607,978 Closing (12/31/2020) 4,119,988 - 13,080,179 Increase/(decrease) 1,341,109 - 472,201 Contract Balances Receivables (1) Contract Asset Contract Liability Opening (1/1/2019) $ 2,816,225 $ - $ 12,508,625 Closing (12/31/2019) 2,778,879 - 12,607,978 Increase/(decrease) (37,346) - 99,353 (1) Included in Receivables, net on the consolidated balance sheets |
Schedule of Opening and Closing Balances of the Assets and Liabilities | The following table disaggregates the opening and closing balances of the Company’s contract balances. Contract Balances Contract Asset Contract Liability Pre-need merchandise and services $ - $ 12,325,437 At-need specialty merchandise - 282,541 Pre-need land sales - - Opening (1/1/2020) $ - $ 12,607,978 Pre-need merchandise and services $ - $ 12,545,753 At-need specialty merchandise - 534,426 Pre-need land sales - - Closing (12/31/2020) $ - $ 13,080,179 Contract Balances Contract Asset Contract Liability Pre-need merchandise and services $ - $ 12,175,943 At-need specialty merchandise - 327,302 Pre-need land sales - 5,380 Opening (1/1/2019) $ - $ 12,508,625 Pre-need merchandise and services $ - $ 12,325,437 At-need specialty merchandise - 282,541 Pre-need land sales - - Closing (12/31/2019) $ - $ 12,607,978 |
Revenues of the Cemetery and Mortuary Contracts | The following table disaggregates revenue for the Company’s cemetery and mortuary contracts. Years Ended December 31 2020 2019 Major goods/service lines At-need $ 15,212,822 $ 12,334,777 Pre-need 5,094,613 2,961,458 $ 20,307,435 $ 15,296,235 Timing of Revenue Recognition Goods transferred at a point in time $ 13,438,592 $ 10,133,723 Services transferred at a point in time 6,868,843 5,162,512 $ 20,307,435 $ 15,296,235 |
Reconciliation of Revenues from Cemetery and mortuary contracts to Business Segment Information | The following table disaggregates contract costs that are included in deferred policy and pre-need contract acquisition costs on the consolidated balances sheets. Years Ended December 31 2020 2019 Pre-need merchandise and services $ 3,601,638 $ 3,590,266 At-need specialty merchandise 5,302 10,688 Pre-need land sales - - $ 3,606,940 $ 3,600,954 |
24) Leases (Tables)
24) Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of Lease Cost Recognized in Earnings | The following table presents the Company’s total lease cost recognized in earnings, amounts capitalized as right-of- use assets and cash flows from lease transactions for the period presented: Year Ended December 31 Year Ended December 31 2020 2019 Lease Cost Finance lease cost: Amortization of right-of-use assets (1) $ 58,576 $ 38,351 Interest on lease liabilities (2) 7,341 9,001 Operating lease cost (3) 5,408,737 5,706,490 Short-term lease cost (3)(4) 222,311 233,318 Sublease income (3) (394,758) (663,242) Total lease cost $ 5,302,207 $ 5,323,918 Other Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 5,293,901 $ 5,567,761 Operating cash flows from finance leases 7,341 9,001 Financing cash flows from finance leases 56,982 95,931 Right-of-use assets obtained in exchange for lease liabilities: Operating leases $ 5,631,193 $ 16,544,406 Finance leases 8,494 252,763 Weighted-average remaining lease term (in years) Finance leases 2.74 3.23 Operating leases 5.40 4.67 Weighted-average discount rate Finance leases 5.59% 5.47% Operating leases 4.87% 5.06% (1) Included in Depreciation on property and equipment on the consolidated statements of earnings (2) Included in Interest expense on the consolidated statements of earnings (3) Included in Rent and rent related expenses on the consolidated statements of earnings (4) Includes leases with a term of 12 months or less |
Schedule of Future Minimum Rental Payments for Operating Leases | The following table presents the maturity analysis of the Company’s lease liabilities. Finance Leases Operating Leases Lease payments due in: 2021 $ 46,898 $ 4,344,756 2022 34,458 3,004,271 2023 27,220 2,088,028 2024 4,354 1,567,924 2025 692 837,526 Thereafter - 2,938,906 Total undiscounted lease payments 113,622 14,781,411 Less: Discount on cash flows (8,671) (2,859,527) Present value of lease liabilities $ 104,951 $ 11,921,884 |
Right-of-Use Assets and Lease Liabilities TextBlock | The following table presents the Company’s right-of-use assets and lease liabilities for the period presented: Balance Sheet Location Year Ended December 31 2020 Year Ended December 31 2019 Operating Leases Right-of-use assets Other assets $ 11,663,245 $ 11,267,247 Lease liabilities Other liabilities and accrued expenses $ 11,921,884 $ 11,405,976 Finance Leases Right-of-use assets $ 254,276 $ 248,565 Accumulated amortization (154,144) (98,351) Right-of-use assets, net Property and equipment, net $ 100,132 $ 150,214 Lease liabilities Bank and other loans payable $ 104,951 $ 153,439 |
2) Investments_ Available for s
2) Investments: Available for sale (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | |||
Available for sale securities, Amortized Cost | $ 265,150,484 | $ 338,629,810 | ||
Available for sale securities, Estimated fair value | 294,656,679 | 355,977,820 | ||
Mortgage loans on real estate and construction | 249,343,936 | 236,694,546 | ||
Mortgage loans on real estate and construction, unamortized deferred loan fees, net | (1,161,132) | (2,391,567) | ||
Mortgage loans on real estate and construction, allowance for losses | (2,005,127) | (1,453,037) | ||
Mortgage loans on real estate and construction, Discount | (1,260,896) | (653,272) | ||
Real estate held for investment, net of depreciation | 131,684,453 | 102,756,946 | ||
Real estate held for sale | 7,878,807 | 14,097,627 | ||
Policy loans | 14,171,589 | 14,762,805 | ||
Insurance assignments | 53,231,131 | 41,062,965 | ||
Federal Home Loan Bank stock | 2,506,600 | [1] | 894,300 | [2] |
Other investments | 5,432,816 | 4,973,225 | ||
Allowance for doubtful accounts | (1,645,475) | (1,448,026) | ||
Total policy loans and other investments | 73,696,661 | 60,245,269 | ||
Accrued investment income | 5,360,523 | 4,833,232 | ||
Total investments | 773,945,298 | 781,876,605 | ||
Total | ||||
Available for sale securities, Amortized Cost | 265,150,484 | 338,629,810 | ||
Available for sale securities, Unrecognized Holding Gain | 30,456,040 | 18,085,841 | ||
Available for sale securities, Unrecognized Holding Loss | (949,845) | (737,831) | ||
Available for sale securities, Estimated fair value | 355,977,820 | |||
US Treasury Securities | ||||
Available for sale securities, Amortized Cost | 42,381,805 | 142,740,641 | ||
Available for sale securities, Unrecognized Holding Gain | 1,358,562 | 632,185 | ||
Available for sale securities, Unrecognized Holding Loss | 0 | (25,215) | ||
Available for sale securities, Estimated fair value | 143,347,611 | |||
US States and Political Subdivisions Debt Securities | ||||
Available for sale securities, Amortized Cost | 5,383,762 | 7,450,366 | ||
Available for sale securities, Unrecognized Holding Gain | 312,214 | 87,812 | ||
Available for sale securities, Unrecognized Holding Loss | (1,261) | (9,026) | ||
Available for sale securities, Estimated fair value | 7,529,152 | |||
Corporate Debt Securities | ||||
Available for sale securities, Amortized Cost | 186,067,912 | 156,599,184 | ||
Available for sale securities, Unrecognized Holding Gain | 27,216,496 | 16,768,449 | ||
Available for sale securities, Unrecognized Holding Loss | (681,478) | (463,413) | ||
Available for sale securities, Estimated fair value | 172,904,220 | |||
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises | ||||
Available for sale securities, Amortized Cost | 31,047,791 | 31,475,280 | ||
Available for sale securities, Unrecognized Holding Gain | 1,565,377 | 597,395 | ||
Available for sale securities, Unrecognized Holding Loss | (267,106) | (240,177) | ||
Available for sale securities, Estimated fair value | 31,832,498 | |||
Redeemable Preferred Stock | ||||
Available for sale securities, Amortized Cost | 269,214 | 364,339 | ||
Available for sale securities, Unrecognized Holding Gain | 3,391 | 0 | ||
Available for sale securities, Unrecognized Holding Loss | 0 | 0 | ||
Available for sale securities, Estimated fair value | 364,339 | |||
Industrial, miscellaneous and all other | ||||
Available-for-sale Securities, Amortized Cost Basis | 9,698,490 | 6,900,537 | ||
Available-for-sale Securities, Gross Unrealized Gain | 2,376,156 | 1,139,799 | ||
Available For Sale Securities - Gross Unrealized Losses | (750,407) | (769,171) | ||
Available for Sale Securities - Estimated Fair Value | 11,324,239 | 7,271,165 | ||
Equity Securities | ||||
Available-for-sale Securities, Amortized Cost Basis | 9,698,490 | 6,900,537 | ||
Available-for-sale Securities, Gross Unrealized Gain | 2,376,156 | 1,139,799 | ||
Available For Sale Securities - Gross Unrealized Losses | (750,407) | (769,171) | ||
Available for Sale Securities - Estimated Fair Value | 11,324,239 | 7,271,165 | ||
Residential Mortgage | ||||
Mortgage loans on real estate and construction | 95,822,448 | 113,043,965 | ||
Real estate held for investment, net of depreciation | 24,843,743 | 12,530,306 | ||
Real estate held for sale | 3,478,254 | 8,021,306 | ||
Residential construction | ||||
Mortgage loans on real estate and construction | 111,111,777 | 89,430,237 | ||
Commercial | ||||
Mortgage loans on real estate and construction | 46,836,866 | 38,718,220 | ||
Real estate held for investment, net of depreciation | 106,840,710 | 90,226,640 | ||
Real estate held for sale | $ 4,400,553 | $ 6,076,321 | ||
[1] | Includes $866,900 of Membership stock and $1,639,700 of Activity stock due to short-term borrowings. | |||
[2] | Includes $894,300 of Membership stock and $-0- of Activity stock due to short-term borrowings. |
2) Investments_ Schedule of Unr
2) Investments: Schedule of Unrealized Loss on Investments (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
US States and Political Subdivisions Debt Securities | ||
Available for sale Securities, Unrecognized Holding Loss | $ 1,261 | $ 9,026 |
Available for sale Securities, Fair Value | 206,812 | 3,062,889 |
US States and Political Subdivisions Debt Securities | Less Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 1,261 | 9,026 |
Available for sale Securities, Fair Value | 206,812 | 3,062,889 |
US States and Political Subdivisions Debt Securities | More Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 0 | 0 |
Available for sale Securities, Fair Value | 0 | 0 |
Corporate Securities | ||
Available for sale Securities, Unrecognized Holding Loss | 681,478 | 463,413 |
Available for sale Securities, Fair Value | 12,512,324 | 11,134,820 |
Corporate Securities | Less Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 242,596 | 118,746 |
Available for sale Securities, Fair Value | 9,919,298 | 7,184,311 |
Corporate Securities | More Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 438,882 | 344,667 |
Available for sale Securities, Fair Value | 2,593,026 | 3,950,509 |
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises | ||
Available for sale Securities, Unrecognized Holding Loss | 267,106 | 240,177 |
Available for sale Securities, Fair Value | 3,507,535 | 13,769,212 |
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises | Less Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 266,522 | 205,470 |
Available for sale Securities, Fair Value | 3,455,574 | 13,266,443 |
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises | More Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 584 | 34,707 |
Available for sale Securities, Fair Value | 51,961 | 502,769 |
Total unrealized losses | ||
Available for sale Securities, Unrecognized Holding Loss | 949,845 | 737,831 |
Available for sale Securities, Fair Value | 16,226,671 | 68,596,609 |
Total unrealized losses | Less Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 510,379 | 353,453 |
Available for sale Securities, Fair Value | 13,581,684 | 54,142,931 |
Total unrealized losses | More Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 439,466 | 384,378 |
Available for sale Securities, Fair Value | $ 2,644,987 | 14,453,678 |
US Treasury Securities [Member] | ||
Available for sale Securities, Unrecognized Holding Loss | 25,215 | |
Available for sale Securities, Fair Value | 40,629,688 | |
US Treasury Securities [Member] | Less Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 20,211 | |
Available for sale Securities, Fair Value | 30,629,288 | |
US Treasury Securities [Member] | More Than 12 Months | ||
Available for sale Securities, Unrecognized Holding Loss | 5,004 | |
Available for sale Securities, Fair Value | $ 10,000,400 |
2) Investments (Details)
2) Investments (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Available for sale securities, Amortized Cost | $ 265,150,484 | $ 338,629,810 |
Fixed maturity securities unrealized gains | $ 12,013,692 | $ 17,315,770 |
Average market value over amortized cost | 94.70% | 98.90% |
Credit losses | $ 370,975 | $ 0 |
Total | ||
Available for sale securities, Amortized Cost | $ 265,150,484 | $ 338,629,810 |
2) Investments_ Other than temp
2) Investments: Other than temporary credit impairments (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Text Block [Abstract] | ||
Balance of credit-related OTTI at beginning | $ 0 | $ 0 |
Additions for credit impairments recognized on: | ||
Securities not previously impaired | 370,975 | 0 |
Securities previously impaired | 0 | 0 |
Reductions for credit impairments previously recognized on: | ||
Securities that matured or were sold during the period (realized) | 0 | 0 |
Securities due to an increase in expected cash flows | 0 | 0 |
Balance of credit-related OTTI at ending | $ 370,975 | $ 0 |
2) Investments_ Investments Cla
2) Investments: Investments Classified by Contractual Maturity Date (Details) | Dec. 31, 2020USD ($) |
Amortized Cost | $ 265,150,484 |
Estimated fair value | 294,656,679 |
Due in 1 year | |
Amortized Cost | 28,634,042 |
Estimated fair value | 28,831,983 |
Due in 2-5 years | |
Amortized Cost | 66,183,907 |
Estimated fair value | 70,910,775 |
Due in 5-10 years | |
Amortized Cost | 70,162,166 |
Estimated fair value | 78,592,046 |
Due in more than 10 years | |
Amortized Cost | 68,853,364 |
Estimated fair value | 83,703,208 |
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises | |
Amortized Cost | 31,047,791 |
Estimated fair value | 32,346,062 |
Redeemable Preferred Stock | |
Amortized Cost | 269,214 |
Estimated fair value | $ 272,605 |
2) Investments_ Gain (Loss) on
2) Investments: Gain (Loss) on Investments (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fixed maturity securities available for sale: | $ 1,554,875 | $ 728,367 |
Fixed maturity securities available for sale | ||
Gross Realized Gains | 445,749 | 459,286 |
Gross Realized Losses | 77,546 | 162,649 |
Other than temporary impairments | (370,975) | 0 |
Equity Securities | ||
Gains on securities sold | 74,836 | 256,520 |
Unrealized Gains and Losses on securities held at end of period | 1,125,304 | 1,086,116 |
Other Assets {1} | ||
Gross Realized Gains | 2,342,418 | 2,844,673 |
Gross Realized Losses | $ (1,984,911) | $ (3,755,579) |
2) Investments_ Net carrying am
2) Investments: Net carrying amount of held to maturity securities (Details) - Fixed maturity securities available for sale - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Net carrying amount for sales of securities | $ 4,950,041 | |
Net realized loss related to sales of securities | $ 43,039 | |
Proceeds received from sale of fixed maturity available for sale securities | $ 5,477,438 | |
Gross realized gains | 358,236 | |
Gross realized losses | $ 21,137 |
2) Investments_ Schedule of Maj
2) Investments: Schedule of Major categories of net investment income (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Gross investment income | $ 69,909,367 | $ 56,520,356 |
Investment Income, Investment Expense | (13,579,564) | (13,500,883) |
Net investment income | 56,329,803 | 43,019,473 |
Fixed Maturities | ||
Gross investment income | 12,233,394 | 10,372,559 |
Equity Securities | ||
Gross investment income | 642,433 | 309,918 |
Mortgage Loans Real Estate | ||
Gross investment income | 25,672,746 | 18,405,010 |
Real Estate | ||
Gross investment income | 11,945,401 | 8,782,959 |
Policy Student and Other Loans | ||
Gross investment income | 1,025,179 | 554,969 |
Insurance Assignments | ||
Gross investment income | 17,837,578 | 16,086,059 |
Other Investments {1} | ||
Gross investment income | 126,013 | 184,439 |
Cash and Cash Equivalents | ||
Gross investment income | $ 426,623 | $ 1,824,443 |
2) Investments_ Net Investment
2) Investments: Net Investment Income - Additional (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Net investment income | $ 56,329,803 | $ 43,019,473 |
Securities on deposit for regulatory authorities | 9,684,409 | 9,633,818 |
Cemeteries And Mortuaries | ||
Net investment income | $ 676,313 | $ 448,754 |
2) Investments_ Commercial Real
2) Investments: Commercial Real Estate Held for Investment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Bank and other loans payable | $ 297,824,368 | $ 217,572,612 |
Impairment losses on commercial real estate held for sale | 897,980 | 2,768,979 |
Kansas | ||
Impairment losses on commercial real estate held for sale | 846,980 | 2,768,979 |
Texas | ||
Impairment losses on commercial real estate held for sale | 51,000 | |
Commercial Real Estate | ||
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate, Gross | 71,517,902 | 87,814,860 |
Bank and other loans payable | $ 46,153,283 | $ 54,917,279 |
2) Investments_ Commercial Re_2
2) Investments: Commercial Real Estate Investment (Details) | Dec. 31, 2020USD ($)Decimal | Dec. 31, 2019USD ($)Decimal | |
Real estate held for investment (net of accumulated depreciation) | $ 131,684,453 | $ 102,756,946 | |
Real estate held for sale | 7,878,807 | 14,097,627 | |
Commercial Real Estate | |||
Real estate held for investment (net of accumulated depreciation) | $ 106,840,710 | $ 90,226,640 | |
Total Square Footage | Decimal | 485,428 | 611,865 | |
Real estate held for sale | $ 4,400,553 | $ 6,076,321 | |
Square Footage | Decimal | 234,979 | 239,779 | |
Louisiana | Commercial Real Estate | |||
Real estate held for investment (net of accumulated depreciation) | $ 2,998,684 | $ 6,009,079 | |
Total Square Footage | Decimal | 84,841 | 125,114 | |
Utah | |||
Real estate held for investment (net of accumulated depreciation) | [1] | $ 23,777,478 | $ 7,889,576 |
Utah | Commercial Real Estate | |||
Real estate held for investment (net of accumulated depreciation) | [2] | $ 100,927,528 | $ 81,266,083 |
Total Square Footage | Decimal | [2] | 379,066 | 465,230 |
Arizona | Commercial Real Estate | |||
Real estate held for sale | [3] | $ 0 | $ 2,500 |
Square Footage | Decimal | [3] | 0 | 0 |
Kansas | Commercial Real Estate | |||
Real estate held for sale | $ 4,000,000 | $ 4,800,000 | |
Square Footage | Decimal | 222,679 | 222,679 | |
Mississippi | Commercial Real Estate | |||
Real estate held for investment (net of accumulated depreciation) | $ 2,914,498 | $ 2,951,478 | |
Total Square Footage | Decimal | 21,521 | 21,521 | |
Real estate held for sale | $ 151,553 | $ 318,322 | |
Square Footage | Decimal | 12,300 | 12,300 | |
Nevada | Commercial Real Estate | |||
Real estate held for sale | $ 0 | $ 655,499 | |
Square Footage | Decimal | 0 | 4,800 | |
Texas | Commercial Real Estate | |||
Real estate held for sale | [4] | $ 249,000 | $ 300,000 |
Square Footage | Decimal | [4] | 0 | 0 |
[1] | The estimated remaining cost to complete the undeveloped lots is $17,354,000 and $1,900,000 as of December 31, 2020 and 2019, respectively | ||
[2] | Includes Center53 phase 1 and phase 2 which is under construction | ||
[3] | Undeveloped land | ||
[4] | Improved commercial pad |
2) Investments_ Residential Rea
2) Investments: Residential Real Estate Held for Investment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Impairment losses on residential real estate held for investment | $ 43,394 | $ 700,134 |
Residential Real Estate | ||
Foreclosed Residential Real Estate included in Residential Real Estate Held for Investment | $ 4,327,079 | $ 12,433,986 |
2) Investments_ Residential R_2
2) Investments: Residential Real Estate Investment (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | ||
Real estate held for investment (net of accumulated depreciation) | $ 131,684,453 | $ 102,756,946 | |
Real estate held for sale | 7,878,807 | 14,097,627 | |
Residential Real Estate | |||
Real estate held for investment (net of accumulated depreciation) | 24,843,743 | 12,530,306 | |
Real estate held for sale | 3,478,254 | 8,021,306 | |
California | Residential Real Estate | |||
Real estate held for sale | 0 | 640,452 | |
Florida | Residential Real Estate | |||
Real estate held for investment (net of accumulated depreciation) | 0 | 2,487,723 | |
Real estate held for sale | 744,322 | 1,300,641 | |
Nevada | Residential Real Estate | |||
Real estate held for investment (net of accumulated depreciation) | 0 | 293,516 | |
Real estate held for sale | 979,640 | 0 | |
Ohio | Residential Real Estate | |||
Real estate held for sale | 10,000 | 10,000 | |
Utah | |||
Real estate held for investment (net of accumulated depreciation) | [1] | 23,777,478 | 7,889,576 |
Utah | Residential Real Estate | |||
Real estate held for investment (net of accumulated depreciation) | [2] | 24,557,562 | 9,462,886 |
Real estate held for sale | 1,744,292 | 5,880,213 | |
Lots available for sale | 36 | 48 | |
Lots to be developed | 350 | 174 | |
Washington | Residential Real Estate | |||
Real estate held for investment (net of accumulated depreciation) | [3] | 286,181 | 286,181 |
Real estate held for sale | $ 0 | $ 190,000 | |
[1] | The estimated remaining cost to complete the undeveloped lots is $17,354,000 and $1,900,000 as of December 31, 2020 and 2019, respectively | ||
[2] | Including subdivision land developments | ||
[3] | Improved residential lots |
2) Investments_ Real Estate Own
2) Investments: Real Estate Owned and Occupied by the Company (Details) | Dec. 31, 2020Decimal |
Corporate Offices, Life Insurance and Cemetery/Mortuary Operations | |
Approximate Square Footage | 78,979 |
Square Footage Occupied by the Company | 18.00% |
Mortgage | |
Approximate Square Footage | 39,157 |
Square Footage Occupied by the Company | 73.00% |
Life Insurance Operations | |
Approximate Square Footage | 19,694 |
Square Footage Occupied by the Company | 28.00% |
Life Insurance Operations 1 | |
Approximate Square Footage | 12,274 |
Square Footage Occupied by the Company | 100.00% |
Mortgage Sales | |
Approximate Square Footage | 8,059 |
Square Footage Occupied by the Company | 100.00% |
Mortgage Sales | |
Approximate Square Footage | 1,560 |
Square Footage Occupied by the Company | 100.00% |
Mortgage Sales | |
Approximate Square Footage | 1,737 |
Square Footage Occupied by the Company | 100.00% |
2) Investments_ Schedule of All
2) Investments: Schedule of Allowance for loan losses as a contra-asset account (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Financing Receivable, Allowance for Credit Loss | $ 1,453,037 | $ 1,347,972 |
Allowance for credit losses, Charge-offs | 0 | (32,692) |
Allowance for Credit Losses, Provision | 552,090 | 137,757 |
Financing Receivable, Allowance for Credit Loss | 2,005,127 | 1,453,037 |
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 219,905 | 195,993 |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 1,785,222 | 1,257,044 |
Mortgage loans | 253,771,091 | 241,192,422 |
Financing Receivable, Individually Evaluated for Impairment | 10,282,470 | 8,895,926 |
Financing Receivable, Collectively Evaluated for Impairment | 243,488,621 | 232,296,496 |
Commercial Loan | ||
Financing Receivable, Allowance for Credit Loss | 187,129 | 187,129 |
Allowance for credit losses, Charge-offs | 0 | 0 |
Allowance for Credit Losses, Provision | 0 | 0 |
Financing Receivable, Allowance for Credit Loss | 187,129 | 187,129 |
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 187,129 | 187,129 |
Mortgage loans | 46,836,866 | 38,718,220 |
Financing Receivable, Individually Evaluated for Impairment | 2,148,827 | 4,488,719 |
Financing Receivable, Collectively Evaluated for Impairment | 44,688,039 | 34,229,501 |
Residential Mortgage | ||
Financing Receivable, Allowance for Credit Loss | 1,222,706 | 1,125,623 |
Allowance for credit losses, Charge-offs | 0 | (32,692) |
Allowance for Credit Losses, Provision | 552,090 | 129,775 |
Financing Receivable, Allowance for Credit Loss | 1,774,796 | 1,222,706 |
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 219,905 | 195,993 |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 1,554,891 | 1,026,713 |
Mortgage loans | 95,822,448 | 113,043,965 |
Financing Receivable, Individually Evaluated for Impairment | 7,932,680 | 3,752,207 |
Financing Receivable, Collectively Evaluated for Impairment | 103,179,097 | 109,291,758 |
Residential construction | ||
Financing Receivable, Allowance for Credit Loss | 43,202 | 35,220 |
Allowance for credit losses, Charge-offs | 0 | 0 |
Allowance for Credit Losses, Provision | 0 | 7,982 |
Financing Receivable, Allowance for Credit Loss | 43,202 | 43,202 |
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 43,202 | 43,202 |
Mortgage loans | 111,111,777 | 89,430,237 |
Financing Receivable, Individually Evaluated for Impairment | 200,963 | 655,000 |
Financing Receivable, Collectively Evaluated for Impairment | $ 95,621,485 | $ 88,775,237 |
2) Investments_ Schedule of agi
2) Investments: Schedule of aging of mortgage loans (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | ||
Mortgage Loans during period | $ 253,771,091 | $ 241,192,422 | |
Mortgage Loans, Allowance for Loan Losses | (2,005,127) | (1,453,037) | |
Mortgage Loans, Unamortized deferred loan fees, net | (1,161,132) | (2,391,567) | |
Mortgage Loans, Unamortized discounts, net | (1,260,896) | (653,272) | |
Past Due 30 to 59 Days | |||
Mortgage Loans during period | 6,226,896 | 12,481,296 | |
Past Due 60 to 89 Days | |||
Mortgage Loans during period | 2,860,928 | 4,085,767 | |
Past Due 90 or More Days | |||
Mortgage Loans during period | [1] | 7,818,410 | 7,244,461 |
In Foreclosure | |||
Mortgage Loans during period | [1] | 2,464,060 | 1,651,465 |
Total Past Due | |||
Mortgage Loans during period | 19,370,294 | 25,462,989 | |
Current | |||
Mortgage Loans during period | 234,400,797 | 215,729,433 | |
Net Mortgage Loans | |||
Mortgage Loans during period | 249,343,936 | 236,694,546 | |
Commercial Loan | |||
Mortgage Loans during period | 46,836,866 | 38,718,220 | |
Mortgage Loans, Allowance for Loan Losses | (187,129) | (187,129) | |
Mortgage Loans, Unamortized deferred loan fees, net | (32,557) | (88,918) | |
Mortgage Loans, Unamortized discounts, net | (880,721) | (653,272) | |
Commercial Loan | Past Due 30 to 59 Days | |||
Mortgage Loans during period | 233,200 | 1,872,000 | |
Commercial Loan | Past Due 60 to 89 Days | |||
Mortgage Loans during period | 812,780 | 0 | |
Commercial Loan | Past Due 90 or More Days | |||
Mortgage Loans during period | [1] | 2,148,827 | 4,488,719 |
Commercial Loan | In Foreclosure | |||
Mortgage Loans during period | [1] | 0 | 0 |
Commercial Loan | Total Past Due | |||
Mortgage Loans during period | 3,194,807 | 6,360,719 | |
Commercial Loan | Current | |||
Mortgage Loans during period | 43,642,059 | 32,357,501 | |
Commercial Loan | Net Mortgage Loans | |||
Mortgage Loans during period | 45,736,459 | 37,788,901 | |
Residential Mortgage | |||
Mortgage Loans during period | 95,822,448 | 113,043,965 | |
Mortgage Loans, Allowance for Loan Losses | (1,774,796) | (1,222,706) | |
Mortgage Loans, Unamortized deferred loan fees, net | (909,864) | (1,567,581) | |
Mortgage Loans, Unamortized discounts, net | (380,175) | 0 | |
Residential Mortgage | Past Due 30 to 59 Days | |||
Mortgage Loans during period | 5,866,505 | 10,609,296 | |
Residential Mortgage | Past Due 60 to 89 Days | |||
Mortgage Loans during period | 2,048,148 | 4,085,767 | |
Residential Mortgage | Past Due 90 or More Days | |||
Mortgage Loans during period | [1] | 5,669,583 | 2,100,742 |
Residential Mortgage | In Foreclosure | |||
Mortgage Loans during period | [1] | 2,263,097 | 1,651,465 |
Residential Mortgage | Total Past Due | |||
Mortgage Loans during period | 15,847,333 | 18,447,270 | |
Residential Mortgage | Current | |||
Mortgage Loans during period | 79,975,115 | 94,596,695 | |
Residential Mortgage | Net Mortgage Loans | |||
Mortgage Loans during period | 92,757,613 | 110,253,678 | |
Residential construction | |||
Mortgage Loans during period | 111,111,777 | 89,430,237 | |
Mortgage Loans, Allowance for Loan Losses | (43,202) | (43,202) | |
Mortgage Loans, Unamortized deferred loan fees, net | (218,711) | (735,068) | |
Mortgage Loans, Unamortized discounts, net | 0 | 0 | |
Residential construction | Past Due 30 to 59 Days | |||
Mortgage Loans during period | 127,191 | 0 | |
Residential construction | Past Due 60 to 89 Days | |||
Mortgage Loans during period | 0 | 0 | |
Residential construction | Past Due 90 or More Days | |||
Mortgage Loans during period | [1] | 0 | 655,000 |
Residential construction | In Foreclosure | |||
Mortgage Loans during period | [1] | 200,963 | 0 |
Residential construction | Total Past Due | |||
Mortgage Loans during period | 328,154 | 655,000 | |
Residential construction | Current | |||
Mortgage Loans during period | 110,783,623 | 88,775,237 | |
Residential construction | Net Mortgage Loans | |||
Mortgage Loans during period | $ 110,849,864 | $ 88,651,967 | |
[1] | There was not any interest income recognized on loans past due greater than 90 days or in foreclosure |
2) Investments_ Schedule of Imp
2) Investments: Schedule of Impaired Mortgage Loans (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Commercial Loan | ||
Impaired Financing Receivable, with No Related Allowance, Recorded Investment | $ 2,148,827 | $ 4,488,719 |
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance | 2,148,827 | 4,488,719 |
Impaired Financing Receivable, with No Related Allowance | 0 | 0 |
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment | 1,866,819 | 1,499,043 |
Impaired Financing Receivable, with No Interest Income Recognized | 0 | 0 |
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 0 | 0 |
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance | 0 | 0 |
Impaired Financing Receivable, Related Allowance | 0 | 0 |
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment | 0 | 0 |
Impaired Financing Receivable, with Interest Income Recognized | 0 | 0 |
Commercial Loan | Total | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 2,148,827 | 4,488,719 |
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance | 2,148,827 | 4,488,719 |
Impaired Financing Receivable, Related Allowance | 0 | 0 |
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment | 1,866,819 | 1,499,043 |
Impaired Financing Receivable, with Interest Income Recognized | 0 | 0 |
Residential Mortgage | ||
Impaired Financing Receivable, with No Related Allowance, Recorded Investment | 6,415,419 | 2,254,189 |
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance | 6,415,419 | 2,254,189 |
Impaired Financing Receivable, with No Related Allowance | 0 | 0 |
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment | 5,010,078 | 3,367,151 |
Impaired Financing Receivable, with No Interest Income Recognized | 0 | 0 |
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 1,517,261 | 1,498,018 |
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance | 1,517,261 | 1,498,018 |
Impaired Financing Receivable, Related Allowance | 219,905 | 195,993 |
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment | 1,182,368 | 665,270 |
Impaired Financing Receivable, with Interest Income Recognized | 0 | 0 |
Residential Mortgage | Total | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 7,932,680 | 3,752,207 |
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance | 7,932,680 | 3,752,207 |
Impaired Financing Receivable, Related Allowance | 219,905 | 195,993 |
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment | 6,192,446 | 4,032,421 |
Impaired Financing Receivable, with Interest Income Recognized | 0 | 0 |
Residential construction | ||
Impaired Financing Receivable, with No Related Allowance, Recorded Investment | 200,963 | 655,000 |
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance | 200,963 | 655,000 |
Impaired Financing Receivable, with No Related Allowance | 0 | 0 |
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment | 555,278 | 1,457,278 |
Impaired Financing Receivable, with No Interest Income Recognized | 0 | 0 |
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 0 | 0 |
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance | 0 | 0 |
Impaired Financing Receivable, Related Allowance | 0 | 0 |
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment | 0 | 0 |
Impaired Financing Receivable, with Interest Income Recognized | 0 | 0 |
Residential construction | Total | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 200,963 | 655,000 |
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance | 200,963 | 655,000 |
Impaired Financing Receivable, Related Allowance | 0 | 0 |
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment | 555,278 | 1,457,278 |
Impaired Financing Receivable, with Interest Income Recognized | $ 0 | $ 0 |
2) Investments_ Schedule Of Cre
2) Investments: Schedule Of Credit Risk Of Mortgage Loans Based On Performance Status (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Mortgage loans | $ 253,771,091 | $ 241,192,422 |
Commercial Loan | ||
Mortgage loans | 46,836,866 | 38,718,220 |
Residential Mortgage | ||
Mortgage loans | 95,822,448 | 113,043,965 |
Residential construction | ||
Mortgage loans | 111,111,777 | 89,430,237 |
Performing Financing Receivable | ||
Mortgage loans | 243,488,621 | 232,296,496 |
Performing Financing Receivable | Commercial Loan | ||
Mortgage loans | 44,688,039 | 34,229,501 |
Performing Financing Receivable | Residential Mortgage | ||
Mortgage loans | 87,889,768 | 109,291,758 |
Performing Financing Receivable | Residential construction | ||
Mortgage loans | 110,910,814 | 88,775,237 |
Nonperforming Financing Receivable | ||
Mortgage loans | 10,282,470 | 8,895,926 |
Nonperforming Financing Receivable | Commercial Loan | ||
Mortgage loans | 2,148,827 | 4,488,719 |
Nonperforming Financing Receivable | Residential Mortgage | ||
Mortgage loans | 7,932,680 | 3,752,207 |
Nonperforming Financing Receivable | Residential construction | ||
Mortgage loans | $ 200,963 | $ 655,000 |
2) Investments_ Summary of Inte
2) Investments: Summary of Interest not accrued on non-performing mortgage loans (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Text Block [Abstract] | ||
Interest not accrued on non-performing loans | $ 491,000 | $ 203,000 |
2) Investments_ Schedule of Mor
2) Investments: Schedule of Mortgage loans on a nonaccrual status (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Loans and Leases Receivable, Nonperforming, Nonaccrual of Interest | $ 10,282,470 | $ 8,895,926 |
Commercial | ||
Loans and Leases Receivable, Nonperforming, Nonaccrual of Interest | 2,148,827 | 4,488,719 |
Residential Mortgage | ||
Loans and Leases Receivable, Nonperforming, Nonaccrual of Interest | 7,932,680 | 3,752,207 |
Residential construction | ||
Loans and Leases Receivable, Nonperforming, Nonaccrual of Interest | $ 200,963 | $ 655,000 |
2) Investments_ Contractual obl
2) Investments: Contractual obligations (Details) | Dec. 31, 2020USD ($) |
Principal Amounts Due in 1 Year | $ 141,705,268 |
Principal Amounts Due in 2-5 Year | 36,596,109 |
Principal Amounts Due Thereafter | 75,469,714 |
Total | 253,771,091 |
Residential Mortgage | |
Principal Amounts Due in 1 Year | 11,202,899 |
Principal Amounts Due in 2-5 Year | 17,774,238 |
Principal Amounts Due Thereafter | 66,845,311 |
Total | 95,822,448 |
Residential construction | |
Principal Amounts Due in 1 Year | 103,391,044 |
Principal Amounts Due in 2-5 Year | 7,720,733 |
Principal Amounts Due Thereafter | 0 |
Total | 111,111,777 |
Commercial | |
Principal Amounts Due in 1 Year | 27,111,325 |
Principal Amounts Due in 2-5 Year | 11,101,138 |
Principal Amounts Due Thereafter | 8,624,403 |
Total | $ 46,836,866 |
3) Loans Held For Sale_ Aggrega
3) Loans Held For Sale: Aggregate fair value - Loans Held for Sale (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Text Block [Abstract] | ||
Aggregate Fair Value - Loans Held For Sale | $ 422,772,418 | $ 213,457,632 |
Aggregate unpaid principal balance - Loans Held for Sale | 406,407,323 | 206,417,122 |
Unrealized gain - Loans Held for Sale | $ 16,365,095 | $ 7,040,510 |
3) Loans Held For Sale_ Schedul
3) Loans Held For Sale: Schedule of Mortgage Fee Income for Loans Held for Sale (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Mortgage fee income | $ 298,933,110 | $ 131,976,082 |
Loans Held For Sale | ||
Loan fees | 43,432,532 | 28,660,966 |
Interest Income | 10,628,581 | 6,978,930 |
Secondary gains | 231,759,342 | 93,581,956 |
Change in fair value of loan commitments | 7,637,377 | 899,417 |
Change in fair value of loans held for sale | 10,413,492 | 2,498,097 |
Provision for loan loss reserve | (4,938,214) | (643,284) |
Mortgage fee income | $ 298,933,110 | $ 131,976,082 |
3) Loans Held For Sale_ Sched_2
3) Loans Held For Sale: Schedule of loan loss reserve which is included in other liabilities and accrued expenses (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Text Block [Abstract] | ||
Beginning, Loan Loss Reserve | $ 4,046,288 | $ 3,604,869 |
Loan loss reserve, Provisions for losses | 4,938,214 | 643,284 |
Loan loss reserve, Additional | 16,506,030 | 0 |
Loan loss reserve, Charge-offs | (4,906,914) | (201,865) |
Ending, Loan Loss Reserve | $ 20,583,618 | $ 4,046,288 |
4) Receivables (Details)
4) Receivables (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Receivables [Abstract] | ||
Trade contracts | $ 4,119,988 | $ 2,795,471 |
Receivables from sales agents | 2,677,774 | 2,962,571 |
Other Receivables | 5,786,827 | 5,202,444 |
Total receivables | 12,584,589 | 10,960,486 |
Allowance for doubtful accounts | (1,685,382) | (1,724,156) |
Net receivables | $ 10,899,207 | $ 9,236,330 |
5) Value of Business Acquired_3
5) Value of Business Acquired, Intangible Assets and Goodwill: Schedule of Value of Business Acquired (Details) - USD ($) | 12 Months Ended | ||||||
Dec. 31, 2025 | Dec. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||
Value of business acquired, balance at start of period | $ 8,955,249 | $ 9,876,647 | $ 5,765,190 | ||||
Value of business acquired | 0 | 4,962,831 | |||||
Imputed interest at 7% included in earnings | 670,565 | 472,916 | |||||
Amortization included in earnings | (1,457,390) | (1,320,456) | |||||
Shadow amortization included in other comprehensive income | (134,573) | (3,834) | |||||
Net amortization | $ (707,000) | $ (784,000) | $ (854,000) | $ (918,000) | $ (1,019,000) | (921,398) | (851,374) |
Value of business acquired, balance at start of period | $ 8,955,249 | $ 9,876,647 |
5) Value of Business Acquired_4
5) Value of Business Acquired, Intangible Assets and Goodwill: Net amortization charged to income (Details) - USD ($) | 12 Months Ended | ||||||
Dec. 31, 2025 | Dec. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||
Value of business acquired - net amortization charged to income | $ 707,000 | $ 784,000 | $ 854,000 | $ 918,000 | $ 1,019,000 | $ 921,398 | $ 851,374 |
Weighted average amortization period | 6 years 1 month 2 days |
5) Value of Business Acquired_5
5) Value of Business Acquired, Intangible Assets and Goodwill: Schedule of Carrying Value of Intangible Asset (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | $ (197,334) | $ (98,222) | |
Finite-Lived Intangible Assets, Net | $ 1,302,666 | 1,401,778 | |
Customer Lists [Member] | |||
Finite-Lived Intangible Asset, Useful Life | 15 years | ||
Finite-Lived Intangible Assets, Gross | $ 890,000 | 890,000 | |
Trade Names [Member] | |||
Finite-Lived Intangible Asset, Useful Life | [1] | 15 years | |
Finite-Lived Intangible Assets, Gross | [1] | $ 610,000 | $ 610,000 |
[1] | See Note 20 regarding the acquisition of Kilpatrick Life Insurance Company |
5) Value of Business Acquired_6
5) Value of Business Acquired, Intangible Assets and Goodwill: Schedule of Goodwill by Segment (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill, Gross | $ 3,519,588 | $ 3,519,588 | $ 2,765,570 | |
Accumulated impairment | 0 | 0 | 0 | |
Total goodwill, net | 3,519,588 | 3,519,588 | 2,765,570 | |
Acquisition | 0 | 754,018 | ||
LifeInsurance | ||||
Goodwill, Gross | 2,765,570 | 2,765,570 | 2,765,570 | |
Accumulated impairment | 0 | 0 | 0 | |
Total goodwill, net | 2,765,570 | 2,765,570 | 2,765,570 | |
Acquisition | 0 | 0 | ||
Cemetery/Mortuary | ||||
Goodwill, Gross | 754,018 | 754,018 | 0 | |
Accumulated impairment | 0 | 0 | 0 | |
Total goodwill, net | $ 754,018 | 754,018 | 0 | |
Acquisition | $ 0 | $ 754,018 | [1] | |
[1] | See Note 20 regarding the acquisition of Probst Family Funerals and Cremations and Heber Valley Funeral Home |
5) Value of Business Acquired_7
5) Value of Business Acquired, Intangible Assets and Goodwill (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 3,519,588 | $ 3,519,588 | $ 2,765,570 |
6) Property and Equipment_ Prop
6) Property and Equipment: Property, Plant and Equipment (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment, Gross | $ 31,652,484 | $ 34,119,285 |
Less accumulated depreciation | (19,179,139) | (19,518,891) |
Property and equipment, net | 12,473,345 | 14,600,394 |
Land and Building [Member] | ||
Property, Plant and Equipment, Gross | 11,972,802 | 15,131,301 |
Furniture and equipment [Member] | ||
Property, Plant and Equipment, Gross | $ 19,679,682 | $ 18,987,984 |
6) Property and Equipment_ (Det
6) Property and Equipment: (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Depreciation expense | $ 2,078,738 | $ 1,711,369 |
Property and equipment, net | 12,473,345 | 14,600,394 |
Transfer of Cemetery Land and Improvements to Property and Equipment | $ 3,261,259 | |
Building [Member] | ||
Property and equipment, net | 1,723,000 | |
Land [Member] | ||
Property and equipment, net | $ 1,516,700 |
7) Bank and Other Loans Payab_3
7) Bank and Other Loans Payable: Summary of Bank Loans Payable (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Total bank and other loans | $ 297,824,368 | $ 217,572,612 | |
Finance lease liabilities | 104,951 | 153,439 | |
Current Installment | 284,250,996 | 192,985,602 | |
Bank and other loans, excluding current installments | 13,573,372 | 24,587,010 | |
Note Payable 1 | |||
Total bank and other loans | 0 | 2,659,769 | |
Note Payable 2 | |||
Total bank and other loans | 633,890 | 1,238,619 | |
Note Payable 3 | |||
Total bank and other loans | 3,257,113 | 4,000,000 | |
Note Payable 4 | |||
Total bank and other loans | 0 | 7,247,651 | |
Note Payable 5 | |||
Total bank and other loans | 1,861,920 | 1,896,450 | |
Note Payable 6 | |||
Total bank and other loans | 35,091,364 | 33,811,559 | |
Note Payable 7 | |||
Total bank and other loans | 9,200,000 | 9,200,000 | |
Note Payable 8 | |||
Total bank and other loans | 116,598,834 | 88,509,536 | |
Note Payable 9 | |||
Total bank and other loans | 68,766,572 | 67,537,600 | |
Note Payable 10 | |||
Total bank and other loans | 60,715,374 | 0 | |
Note Payable 11 | |||
Total bank and other loans | 317,582 | 0 | |
Other short-term borrowings | |||
Total bank and other loans | [1] | 1,250,000 | 1,250,000 |
Other loans payable | |||
Total bank and other loans | $ 26,768 | $ 67,989 | |
[1] | Revolving Line of Credit |
7) Bank and Other Loans Payab_4
7) Bank and Other Loans Payable (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Investment | $ 773,945,298 | $ 781,876,605 |
Interest expense | 8,578,810 | 7,386,688 |
Interest Paid, Including Capitalized Interest, Operating and Investing Activities | $ 8,385,270 | 7,284,078 |
Mortgage Warehouse Line of Credit 1 | ||
Line of Credit Facility, Description | The Company, through its subsidiary SecurityNational Mortgage, has a $150,000,000 line of credit with Wells Fargo Bank N.A. The agreement charges interest at the 1-Month LIBOR rate plus 2.1% and matures on June 24, 2021 | |
Mortgage Warehouse Line of Credit 2 | ||
Line of Credit Facility, Description | The Company, through its subsidiary SecurityNational Mortgage, has a line of credit with Texas Capital Bank N.A. This agreement with the bank allows SecurityNational Mortgage to borrow up to $175,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 3% and matures on November 15, 2021 | |
Comerica Bank | ||
Line of Credit Facility, Description | The Company through its subsidiary SecurityNational Mortgage, has a line of credit with Comerica Bank. This agreement with the bank allows SecurityNational Mortgage to borrow up to $90,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 2.5% and matures on May 27, 2021 | |
Texas Capital Bank | ||
Line of Credit Facility, Description | The Company, through its subsidiary EverLEND Mortgage, has a line of credit with Texas Capital Bank N.A. This agreement with the bank allows EverLEND Mortgage to borrow up to $5,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 2.5% and matures on August 1, 2021 | |
Kilpatrick Life Insurance Company | ||
Investment | $ 1,720,300 | 87,800 |
FHLB | ||
Line of Credit Facility, Maximum Borrowing Capacity | 39,102,336 | 57,727,738 |
Line of credit | 0 | 0 |
Mortage property, fair value | 40,729,400 | 59,877,900 |
Investment | 786,300 | $ 806,500 |
Bank | ||
Line of Credit Facility, Maximum Borrowing Capacity | 2,000,000 | |
Line of credit | 0 | |
Mortage property, fair value | $ 348,183 | |
Maturity | Sep. 30, 2021 | |
Bank | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,500,000 | |
Line of credit | $ 1,250,000 | |
Maturity | Sep. 30, 2021 |
7) Bank and Other Loans Payab_5
7) Bank and Other Loans Payable: Schedule of combined maturities of bank loans payable, lines of credit and notes (Details) | Dec. 31, 2020USD ($) |
Bank loans payable, lines of credit and notes and contracts payable | $ 297,824,368 |
Due in Year One | |
Bank loans payable, lines of credit and notes and contracts payable | 284,242,327 |
Due in Year Two | |
Bank loans payable, lines of credit and notes and contracts payable | 884,383 |
Due in Year Three | |
Bank loans payable, lines of credit and notes and contracts payable | 926,186 |
Due in Year Four | |
Bank loans payable, lines of credit and notes and contracts payable | 937,315 |
Due in Year Five | |
Bank loans payable, lines of credit and notes and contracts payable | 1,634,157 |
DueThereafter | |
Bank loans payable, lines of credit and notes and contracts payable | $ 9,200,000 |
8) Cemetery Perpetual Care Tr_3
8) Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets: Schedule of cemetery perpetual (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Total Cemetery Perpetual Care Trust Investments | $ 6,413,167 | $ 5,952,984 |
Cemetery perpetual care obligation | (4,087,704) | (3,933,719) |
Trust investments in excess of trust obligations | 2,325,463 | 2,019,265 |
Cash and cash equivalents | ||
Total Cemetery Perpetual Care Trust Investments | 402,913 | 1,306,740 |
Fixed Maturities | ||
Total Cemetery Perpetual Care Trust Investments | 747,767 | 975,673 |
Equity Securities | ||
Total Cemetery Perpetual Care Trust Investments | 2,062,303 | 1,605,451 |
Commercial Mortgage Loans Held for Investment | ||
Total Cemetery Perpetual Care Trust Investments | 0 | 524,000 |
Residential Mortgage | ||
Total Cemetery Perpetual Care Trust Investments | 1,468,600 | 0 |
Real estate | ||
Total Cemetery Perpetual Care Trust Investments | 1,731,584 | 0 |
Note receivables | ||
Total Cemetery Perpetual Care Trust Investments | 0 | 0 |
Cemetery and Memorial Estates | ||
Total Cemetery Perpetual Care Trust Investments | $ 0 | $ 1,541,120 |
8) Cemetery Perpetual Care Tr_4
8) Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets: Schedule of Restricted Assets (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Restricted assets | $ 16,150,036 | $ 13,935,317 | |
Cash and cash equivalents | |||
Restricted assets | [1] | 8,842,744 | 8,674,214 |
Fixed maturity securities | |||
Restricted assets | 1,473,637 | 1,008,867 | |
Equity Securities | |||
Restricted assets | 2,515,778 | 1,976,480 | |
Restricted Assets, Participating Interests in Mortgage Loans Held for Investment | |||
Restricted assets | $ 3,317,877 | $ 2,275,756 | |
[1] | Including cash and cash equivalents of $8,524,999 and $7,170,092 as of December 31, 2020 and 2019, respectively, for the life insurance and mortgage segments |
9) Income Taxes_ Summary of Inc
9) Income Taxes: Summary of Income Tax Liability (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Disclosure Text Block [Abstract] | ||
Current Income Tax Liability | $ 2,595,877 | $ 1,410,153 |
Income Tax Liability | 22,662,923 | 17,276,819 |
Income Taxes | $ 25,258,800 | $ 18,686,972 |
9) Income Taxes_ Schedule of De
9) Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Disclosure Text Block [Abstract] | ||
Deferred Tax, Future policy benefits | $ (12,657,045) | $ (12,450,229) |
Deferred Tax, Loan Loss Reserve | (5,352,942) | (1,053,256) |
Deferred Tax, Unearned premium | (699,011) | (760,556) |
Deferred Tax Net Operating Loss | (334,085) | (438,420) |
Deferred Tax, Deferred Compensation | (2,833,298) | (1,996,865) |
Deferred Tax, Deposit Obligations | (610,041) | (619,633) |
Deferred Tax, Other | (1,269,533) | (1,020,718) |
Deferred Tax Assets, Valuation Allowance | 961,920 | 2,439,394 |
Deferred Tax Assets, Net of Valuation Allowance | (22,794,035) | (15,900,283) |
Deferred Tax, Deferred policy acquisition costs | 16,430,001 | 15,536,717 |
Deferred Tax, Basis difference in property and equipment | 5,312,787 | 3,638,512 |
Deferred Tax, Value of business acquired | 1,880,602 | 2,074,096 |
Deferred Tax, Deferred Gains | 12,124,226 | 5,169,104 |
Deferred Tax, Trusts | 1,064,387 | 1,064,387 |
Deferred Tax, Tax on Unrealized Appreciation | 8,644,955 | 5,694,286 |
Deferred Tax Liabilities, Net | 45,456,958 | 33,177,102 |
Income Tax Liability | $ 22,662,923 | $ 17,276,819 |
9) Income Taxes (Details)
9) Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Disclosure Text Block [Abstract] | ||
Income Taxes Paid | $ 11,813,120 | $ 4,861,318 |
Effective Income Tax Rate Reconciliation, Percent | 22.20% | 21.90% |
9) Income Taxes_ Schedule of Co
9) Income Taxes: Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Current | ||
Federal | $ 10,678,612 | $ 4,404,041 |
State | 2,320,233 | 504,272 |
Current Income Tax Expense (Benefit) | 12,998,845 | 4,908,313 |
Deferred | ||
Federal | 2,677,943 | (1,551,725) |
State | 176,726 | (306,172) |
Provision for deferred income taxes | 2,854,669 | (1,857,897) |
Income Tax Expense (Benefit) | $ 15,853,514 | $ 3,050,416 |
9) Income Taxes_ Schedule of Ef
9) Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Disclosure Text Block [Abstract] | ||
Computed expense at statutory rate | $ (15,004,527) | $ (2,928,226) |
State tax expense, net of federal tax benefit | 1,972,598 | 156,499 |
Change in valuation allowance | (1,477,474) | 194,364 |
Other, net | 353,863 | (228,673) |
Income tax expense | $ 15,853,514 | $ 3,050,416 |
9) Income Taxes_ Unrecognized t
9) Income Taxes: Unrecognized tax benefits, interest and penalties (Details) | Dec. 31, 2020USD ($) |
Disclosure Text Block [Abstract] | |
Unrecognized Tax Benefits | $ 0 |
9) Income Taxes_ Summary of Ope
9) Income Taxes: Summary of Operating Loss Carryforwards (Details) | Dec. 31, 2020USD ($) |
Deferred Tax Assets, Operating Loss Carryforwards | $ 1,422,255 |
Year of Expiration 2021 | |
Deferred Tax Assets, Operating Loss Carryforwards | 17,100 |
Year of Expiration 2022 | |
Deferred Tax Assets, Operating Loss Carryforwards | 0 |
Year of Expiration 2023 | |
Deferred Tax Assets, Operating Loss Carryforwards | 0 |
Year of Expiration 2024 | |
Deferred Tax Assets, Operating Loss Carryforwards | 0 |
Year of Expiration 2025 | |
Deferred Tax Assets, Operating Loss Carryforwards | 0 |
Year of Expiration Thereafter up through 2037 | |
Deferred Tax Assets, Operating Loss Carryforwards | $ 1,405,155 |
10) Reinsurance, Commitments _2
10) Reinsurance, Commitments and Contingencies Reinsurance (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Disclosure Text Block [Abstract] | ||
Insurance assumed from other companies | $ 96,000,000 | $ 99,000,000 |
10) Reinsurance, Commitments _3
10) Reinsurance, Commitments and Contingencies: Mortgage Loan Loss Settlements (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Text Block [Abstract] | ||
Amounts accrued for loan losses | $ 20,584,000 | $ 4,046,000 |
10) Reinsurance, Commitments _4
10) Reinsurance, Commitments and Contingencies: Other Contingencies and Commitments (Details) | Dec. 31, 2020USD ($) |
Text Block [Abstract] | |
Commitments to fund new residential construction loans | $ 185,751,000 |
Commitments to fund new residential construction loans funded | $ 115,898,000 |
11) Retirement Plans_ Deferred
11) Retirement Plans: Deferred Compensation Plans (Details) - Employee Stock Ownership Plan - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Pretax contributions | $ 19,500 | $ 19,000 |
Contribution to plan | 1,690,568 | 695,560 |
Compensation expenses | 900,000 | 660,000 |
Present value of anticipated benefits | 6,656,363 | 5,722,837 |
Payment to retirement compensation | 133,843 | 133,843 |
Deferred Compensation Arrangement with Individual, Recorded Liability | $ 669,212 | $ 803,055 |
Common Class A | ||
Shares reserved for future issuance | 231,312 | |
Common Class C | ||
Shares reserved for future issuance | 118,880 |
12) Capital Stock_ Share-based
12) Capital Stock: Share-based Payment Arrangement, Option, Activity (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Common Class A | ||
Common Stock, Shares, Outstanding | 16,107,779 | 15,304,798 |
Exercise of stock options | 68,970 | 32,517 |
Dividends | $ 405,210 | $ 767,178 |
Conversion of Class C to Class A | 13,824 | 3,286 |
Common Stock, Shares, Outstanding | 16,595,783 | 16,107,779 |
Common Class C | ||
Common Stock, Shares, Outstanding | 2,500,887 | 2,193,643 |
Exercise of stock options | 130,820 | 191,443 |
Dividends | $ 61,720 | $ 119,087 |
Conversion of Class C to Class A | (13,824) | (3,286) |
Common Stock, Shares, Outstanding | 2,679,603 | 2,500,887 |
12) Capital Stock_ Schedule of
12) Capital Stock: Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator: | ||
Net earnings | $ 55,596,613 | $ 10,893,519 |
Denominator: | ||
Denominator for basic earnings per share-weighted-average shares | 18,831,991 | 18,562,056 |
Effect of dilutive securities Employee stock options | 443,260 | 127,608 |
Effect of dilutive securities Dilutive potential common shares | 443,260 | 127,608 |
Denominator for diluted earnings per share-adjusted weighted-average shares and assumed conversions | 19,275,251 | 18,689,664 |
Basic earnings per share | $ 2.95 | $ 0.59 |
Diluted earnings per share | $ 2.88 | $ 0.58 |
12) Capital Stock (Details)
12) Capital Stock (Details) - shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Employee stock option | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 382,289 |
13) Stock Compensation Plans (D
13) Stock Compensation Plans (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Text Block [Abstract] | ||
Share-based Payment Arrangement, Amount Capitalized | $ 358,878 | $ 256,996 |
Unrecognized compensation expense related to the options issued in December 2014 | 39,152 | |
Total intrinsic value | $ 663,901 | $ 271,220 |
13) Stock Compensation Plans_ S
13) Stock Compensation Plans: Schedule of Assumptions Used (Details) | 12 Months Ended |
Dec. 31, 2020$ / shares | |
All Plans - March 27 2020 | |
Weighted Average Fair Value of Each Option | $ 0.65 |
Expected Dividend Yield | 5.00% |
Underlying stock FMV | $ 3.76 |
Weighted Average Volatility | 32.29% |
Weighted Average Risk Free Interest Rate | 1.64% |
Weighted Average Expected Life (Term) | 4 years 9 months 25 days |
All Plans - December 6, 2019 | |
Weighted Average Fair Value of Each Option | $ 0.96 |
Expected Dividend Yield | 5.00% |
Underlying stock FMV | $ 5.19 |
Weighted Average Volatility | 32.79% |
Weighted Average Risk Free Interest Rate | 1.64% |
Weighted Average Expected Life (Term) | 4 years 9 months 29 days |
All Plans - January 17, 2019 | |
Weighted Average Fair Value of Each Option | $ 1.12 |
Expected Dividend Yield | 5.00% |
Underlying stock FMV | $ 4.98 |
Weighted Average Volatility | 36.04% |
Weighted Average Risk Free Interest Rate | 2.56% |
Weighted Average Expected Life (Term) | 5 years 3 months 22 days |
13) Stock Compensation Plans__2
13) Stock Compensation Plans: Schedule of stock inventive plan changes (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | ||
Common Class A | |||
Shares, Outstanding, beginning | 1,086,053 | 1,011,274 | |
Adjustment for effect of stock dividends | 27,968 | 51,018 | |
Shares Granted | 77,000 | 81,000 | |
Shares Exercised | (116,487) | (45,834) | |
Shares Cancelled | (1,671) | (11,405) | |
Shares, Outstanding, ending | 1,072,863 | 1,086,053 | |
Shares outstanding, beginning | $ 4.41 | $ 4.49 | |
Per Share Shares Granted | 0 | 0 | |
Per Share Shares Exercised | 0 | 0 | |
Per Share Shares cancelled | 0 | 0 | |
Shares, Outstanding, ending | $ 4.33 | $ 4.41 | |
Options Exercisable | 1,053,903 | ||
Available options for future grant | $ 325,372 | ||
Weighted average contractual term of options outstanding | P5Y6M | ||
Weighted average contractual term of options exercisable | P5Y5M5D | ||
Aggregated intrinsic value of options outstanding | [1] | $ 4,311,983 | |
Aggregated intrinsic value of options exercisable | [1] | $ 4,223,251 | |
Common Class C | |||
Shares, Outstanding, beginning | 594,132 | 577,280 | |
Adjustment for effect of stock dividends | 19,354 | 28,295 | |
Shares Granted | 180,000 | 180,000 | |
Shares Exercised | (130,820) | (191,443) | |
Shares Cancelled | 0 | 0 | |
Shares, Outstanding, ending | 662,666 | 594,132 | |
Shares outstanding, beginning | $ 5.36 | $ 5.15 | |
Per Share Shares Granted | 0 | 0 | |
Per Share Shares Exercised | 0 | 0 | |
Per Share Shares cancelled | 0 | 0 | |
Shares, Outstanding, ending | $ 4.73 | $ 5.36 | |
Options Exercisable | 616,542 | ||
Available options for future grant | $ 266,500 | ||
Weighted average contractual term of options outstanding | P6Y8M16D | ||
Weighted average contractual term of options exercisable | P6Y7M17D | ||
Aggregated intrinsic value of options outstanding | [1] | $ 2,396,954 | |
Aggregated intrinsic value of options exercisable | [1] | $ 2,183,399 | |
[1] | The Company used a stock price of $8.35 as of December 31, 2020 to derive intrinsic value. |
14) Statutory Financial Infor_3
14) Statutory Financial Information and Dividend Limitations: Schedule of statutory accounting practices (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Statutory Net Income Amount | $ 8,417,824 | $ 17,424,138 |
Statutory Capital and Surplus, Balance | 78,493,142 | 74,140,040 |
Security National Life Insurance | ||
Statutory Net Income Amount | 6,054,764 | 3,589,552 |
Statutory Capital and Surplus, Balance | 53,089,185 | 49,390,181 |
Kilpatrick Life Insurance Company | ||
Statutory Net Income Amount | 1,574,128 | 12,752,100 |
Statutory Capital and Surplus, Balance | 15,177,996 | 15,208,071 |
First Guaranty Insurance Company | ||
Statutory Net Income Amount | 790,221 | 1,078,733 |
Statutory Capital and Surplus, Balance | 7,045,644 | 6,352,670 |
Memorial Insurance Company of America | ||
Statutory Net Income Amount | 55 | (107) |
Statutory Capital and Surplus, Balance | 1,088,034 | 1,088,559 |
Southern Security Life Insurance Company Inc | ||
Statutory Net Income Amount | 183 | 87 |
Statutory Capital and Surplus, Balance | 1,581,647 | 1,588,396 |
Trans-Western Life Insurance Company | ||
Statutory Net Income Amount | (1,527) | 3,773 |
Statutory Capital and Surplus, Balance | $ 510,636 | $ 512,163 |
14) Statutory Financial Infor_4
14) Statutory Financial Information and Dividend Limitations (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash dividend paid | $ 5,309,000 | |
First Guaranty Insurance Company | ||
Cash dividend paid | 3,146,000 | $ 500,000 |
Kilpatrick Life Insurance Company | ||
Cash dividend paid | $ 11,478,000 | $ 3,000,000 |
15) Business Segments Informa_2
15) Business Segments Information : Schedule of reporting segment (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues: | |||
Other revenues | $ 9,246,574 | $ 7,577,641 | |
Net investment income | 56,329,803 | 43,019,473 | |
Total revenues | 481,463,322 | 283,060,930 | |
Selling, general and administrative expenses: | |||
Commissions | 124,426,297 | 56,762,891 | |
Personnel | 84,989,971 | 64,221,270 | |
Advertising | 5,380,896 | 4,784,558 | |
Rent and rent related | 6,873,561 | 7,055,456 | |
Depreciation on property and equipment | 2,078,738 | 1,711,369 | |
Costs related to funding mortgage loans | 9,877,700 | 6,278,954 | |
Interest expense: | |||
Cost of goods and services sold - cemeteries and mortuaries | 3,252,655 | 2,878,169 | |
Income tax benefit (expense) | (15,853,514) | (3,050,416) | |
Net Earnings (Loss) | 55,596,613 | 10,893,519 | |
Goodwill | 3,519,588 | 3,519,588 | $ 2,765,570 |
Life Insurance Product Line | |||
Revenues: | |||
Revenue from customers | 93,020,617 | 81,860,610 | |
Net investment income | 54,811,486 | 41,610,831 | |
Gains on investments and other assets | 2,088,541 | 138,330 | |
Other than temporary impairments | (370,975) | ||
Other revenues | 1,491,585 | 2,128,961 | |
Net investment income | 8,022,503 | 4,455,034 | |
Total revenues | 159,063,757 | 130,193,766 | |
Expenses: | |||
Death, surrenders and other policy benefits | 62,841,360 | 44,911,805 | |
Increase in future policy benefits | 23,568,650 | 23,568,497 | |
Amortization of deferred policy and pre-need acquisition costs and value of business acquired | 13,618,204 | 14,199,152 | |
Selling, general and administrative expenses: | |||
Commissions | 4,149,241 | 3,632,780 | |
Personnel | 25,449,100 | 20,311,591 | |
Advertising | 614,114 | 595,118 | |
Rent and rent related | 861,602 | 451,380 | |
Depreciation on property and equipment | 843,335 | 477,247 | |
Provision for loan loss reserve | 0 | ||
Costs related to funding mortgage loans | 0 | 0 | |
Intersegment | 621,161 | 412,853 | |
Other | 11,808,818 | 11,769,097 | |
Interest expense: | |||
Intersegment | 410,024 | 490,756 | |
Other | 2,354,760 | 2,808,081 | |
Cost of goods and services sold - cemeteries and mortuaries | 0 | 0 | |
Total benefits and expenses | 147,140,369 | 123,628,357 | |
Earnings before income taxes | 11,923,388 | 6,565,409 | |
Income tax benefit (expense) | (1,433,901) | (1,085,848) | |
Net Earnings (Loss) | 10,489,487 | 5,479,561 | |
Identifiable Assets | 1,171,158,235 | 1,110,641,526 | |
Goodwill | 2,765,570 | 2,765,570 | |
Cemetery and Mortuary | |||
Revenues: | |||
Revenue from customers | 20,307,435 | 15,296,235 | |
Net investment income | 807,695 | 579,995 | |
Gains on investments and other assets | (162,652) | 530,098 | |
Other than temporary impairments | 0 | ||
Other revenues | 94,349 | 95,197 | |
Net investment income | 351,505 | 443,548 | |
Total revenues | 21,398,332 | 16,945,073 | |
Expenses: | |||
Death, surrenders and other policy benefits | 0 | 0 | |
Increase in future policy benefits | 0 | 0 | |
Amortization of deferred policy and pre-need acquisition costs and value of business acquired | 689,221 | 435,425 | |
Selling, general and administrative expenses: | |||
Commissions | 1,506,320 | 1,084,079 | |
Personnel | 5,669,367 | 5,177,810 | |
Advertising | 391,836 | 368,173 | |
Rent and rent related | 89,253 | 47,525 | |
Depreciation on property and equipment | 488,570 | 428,633 | |
Provision for loan loss reserve | 0 | ||
Costs related to funding mortgage loans | 0 | 0 | |
Intersegment | 142,999 | 180,594 | |
Other | 4,417,805 | 3,241,023 | |
Interest expense: | |||
Intersegment | 152,175 | 154,615 | |
Other | 198,968 | 288,768 | |
Cost of goods and services sold - cemeteries and mortuaries | 3,252,655 | 2,878,169 | |
Total benefits and expenses | 16,999,169 | 14,284,814 | |
Earnings before income taxes | 4,399,163 | 2,660,259 | |
Income tax benefit (expense) | (1,009,137) | (649,144) | |
Net Earnings (Loss) | 3,390,026 | 2,011,115 | |
Identifiable Assets | 56,335,498 | 81,014,182 | |
Goodwill | 754,018 | 754,018 | |
Mortgage | |||
Revenues: | |||
Revenue from customers | 298,933,110 | 131,976,082 | |
Net investment income | 710,622 | 828,647 | |
Gains on investments and other assets | (39) | 59,939 | |
Other than temporary impairments | 0 | ||
Other revenues | 9,731,548 | 7,956,005 | |
Net investment income | 716,240 | 508,637 | |
Total revenues | 310,091,481 | 141,329,310 | |
Expenses: | |||
Death, surrenders and other policy benefits | 0 | 0 | |
Increase in future policy benefits | 0 | 0 | |
Amortization of deferred policy and pre-need acquisition costs and value of business acquired | 0 | 0 | |
Selling, general and administrative expenses: | |||
Commissions | 118,770,736 | 52,046,032 | |
Personnel | 53,871,504 | 38,731,869 | |
Advertising | 4,374,946 | 3,821,267 | |
Rent and rent related | 5,922,706 | 6,556,551 | |
Depreciation on property and equipment | 746,833 | 805,489 | |
Provision for loan loss reserve | 16,506,030 | ||
Costs related to funding mortgage loans | 9,877,700 | 6,278,954 | |
Intersegment | 580,976 | 544,463 | |
Other | 31,104,479 | 19,912,641 | |
Interest expense: | |||
Intersegment | 7,182,913 | 3,623,938 | |
Other | 6,025,082 | 4,289,839 | |
Cost of goods and services sold - cemeteries and mortuaries | 0 | 0 | |
Total benefits and expenses | 254,963,905 | 136,611,043 | |
Earnings before income taxes | 55,127,576 | 4,718,267 | |
Income tax benefit (expense) | (13,410,476) | (1,315,424) | |
Net Earnings (Loss) | 41,717,100 | 3,402,843 | |
Identifiable Assets | 408,325,196 | 249,970,323 | |
Goodwill | 0 | 0 | |
Intercompany Eliminations | |||
Revenues: | |||
Revenue from customers | 0 | 0 | |
Net investment income | 0 | 0 | |
Gains on investments and other assets | 0 | 0 | |
Other than temporary impairments | 0 | ||
Other revenues | 0 | 0 | |
Net investment income | (9,090,248) | (5,407,219) | |
Total revenues | (9,090,248) | (5,407,219) | |
Expenses: | |||
Death, surrenders and other policy benefits | 0 | 0 | |
Increase in future policy benefits | 0 | 0 | |
Amortization of deferred policy and pre-need acquisition costs and value of business acquired | 0 | 0 | |
Selling, general and administrative expenses: | |||
Commissions | 0 | 0 | |
Personnel | 0 | 0 | |
Advertising | 0 | 0 | |
Rent and rent related | 0 | 0 | |
Depreciation on property and equipment | 0 | 0 | |
Provision for loan loss reserve | 0 | ||
Costs related to funding mortgage loans | 0 | 0 | |
Intersegment | (1,345,136) | (1,137,910) | |
Other | 0 | 0 | |
Interest expense: | |||
Intersegment | (7,745,112) | (4,269,309) | |
Other | 0 | 0 | |
Cost of goods and services sold - cemeteries and mortuaries | 0 | 0 | |
Total benefits and expenses | (9,090,248) | (5,407,219) | |
Earnings before income taxes | 0 | 0 | |
Income tax benefit (expense) | 0 | 0 | |
Net Earnings (Loss) | 0 | 0 | |
Identifiable Assets | (90,398,039) | (110,701,544) | |
Goodwill | 0 | 0 | |
Consolidated | |||
Revenues: | |||
Revenue from customers | 412,261,162 | 229,132,927 | |
Net investment income | 56,329,803 | 43,019,473 | |
Gains on investments and other assets | 1,925,850 | 728,367 | |
Other than temporary impairments | (370,975) | ||
Other revenues | 11,317,482 | 10,180,163 | |
Net investment income | 0 | 0 | |
Total revenues | 481,463,322 | 283,060,930 | |
Expenses: | |||
Death, surrenders and other policy benefits | 62,841,360 | 44,911,805 | |
Increase in future policy benefits | 23,568,650 | 23,568,497 | |
Amortization of deferred policy and pre-need acquisition costs and value of business acquired | 14,307,425 | 14,634,577 | |
Selling, general and administrative expenses: | |||
Commissions | 124,426,297 | 56,762,891 | |
Personnel | 84,989,971 | 64,221,270 | |
Advertising | 5,380,896 | 4,784,558 | |
Rent and rent related | 6,873,561 | 7,055,456 | |
Depreciation on property and equipment | 2,078,738 | 1,711,369 | |
Provision for loan loss reserve | 16,506,030 | 0 | |
Costs related to funding mortgage loans | 9,877,700 | 6,278,954 | |
Intersegment | 0 | 0 | |
Other | 47,331,102 | 34,922,761 | |
Interest expense: | |||
Intersegment | 0 | 0 | |
Other | 8,578,810 | 7,386,688 | |
Cost of goods and services sold - cemeteries and mortuaries | 3,252,655 | 2,878,169 | |
Total benefits and expenses | 410,013,195 | 269,116,995 | |
Earnings before income taxes | 71,450,127 | 13,943,935 | |
Income tax benefit (expense) | (15,853,514) | (3,050,416) | |
Net Earnings (Loss) | 55,596,613 | 10,893,519 | |
Identifiable Assets | 1,545,420,890 | 1,330,924,487 | |
Goodwill | $ 3,519,588 | $ 3,519,588 |
17) Fair Value of Financial I_3
17) Fair Value of Financial Instruments: Schedule of fair value assets and liabilities measured recurring basis (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Fixed maturity securities available for sale | $ 294,656,679 | $ 355,977,820 | |
Equity securities | 11,324,239 | 7,271,165 | |
Loans Held-for-sale | 422,772,418 | 213,457,632 | |
Restricted assets of cemeteries and mortuaries | [1] | 1,473,637 | 1,008,867 |
Restricted assets of cemeteries and mortuaries | [2] | 2,515,778 | 1,976,480 |
Cemetery perpetual care trust investments | [1] | 747,767 | 975,673 |
Cemetery perpetual care trust investments | [2] | 2,062,303 | 1,605,451 |
Derivatives - loan commitments | [3] | 12,592,672 | 2,722,580 |
Total assets accounted for at fair value on a recurring basis | 748,145,493 | 584,995,668 | |
Derivatives - call options | [4] | (43,097) | (62,265) |
Derivatives - loan commitments | [4] | (2,464,062) | (22,282) |
Derivatives - bank loan interest rate swaps, loan commitments | [4] | (231,347) | |
Total liabilities accounted for at fair value on a recurring basis | (2,507,159) | (315,894) | |
Fair Value, Inputs, Level 1 | |||
Fixed maturity securities available for sale | 0 | 0 | |
Equity securities | 11,324,239 | 7,271,165 | |
Loans Held-for-sale | 0 | 0 | |
Restricted assets of cemeteries and mortuaries | [1] | 0 | 0 |
Restricted assets of cemeteries and mortuaries | [2] | 2,515,778 | 1,976,480 |
Cemetery perpetual care trust investments | [1] | 0 | 0 |
Cemetery perpetual care trust investments | [2] | 2,062,303 | 1,605,451 |
Derivatives - loan commitments | [3] | 0 | 0 |
Total assets accounted for at fair value on a recurring basis | 15,902,320 | 10,853,096 | |
Derivatives - call options | [4] | (43,097) | (62,265) |
Derivatives - loan commitments | [4] | 0 | (22,282) |
Derivatives - bank loan interest rate swaps, loan commitments | [4] | 0 | |
Total liabilities accounted for at fair value on a recurring basis | (43,097) | (84,547) | |
Fair Value, Inputs, Level 2 | |||
Fixed maturity securities available for sale | 292,455,504 | 352,761,438 | |
Equity securities | 0 | 0 | |
Loans Held-for-sale | 0 | 0 | |
Restricted assets of cemeteries and mortuaries | [1] | 1,473,637 | 1,008,867 |
Restricted assets of cemeteries and mortuaries | [2] | 0 | 0 |
Cemetery perpetual care trust investments | [1] | 747,767 | 975,673 |
Cemetery perpetual care trust investments | [2] | 0 | 0 |
Derivatives - loan commitments | [3] | 0 | 0 |
Total assets accounted for at fair value on a recurring basis | 294,676,908 | 354,745,978 | |
Derivatives - call options | [4] | 0 | 0 |
Derivatives - loan commitments | [4] | 0 | 0 |
Derivatives - bank loan interest rate swaps, loan commitments | [4] | 0 | |
Total liabilities accounted for at fair value on a recurring basis | 0 | 0 | |
Fair Value, Inputs, Level 3 | |||
Fixed maturity securities available for sale | 2,201,175 | 3,216,382 | |
Equity securities | 0 | 0 | |
Loans Held-for-sale | 422,772,418 | 213,457,632 | |
Restricted assets of cemeteries and mortuaries | [1] | 0 | 0 |
Restricted assets of cemeteries and mortuaries | [2] | 0 | 0 |
Cemetery perpetual care trust investments | [1] | 0 | 0 |
Cemetery perpetual care trust investments | [2] | 0 | 0 |
Derivatives - loan commitments | [3] | 12,592,672 | 2,722,580 |
Total assets accounted for at fair value on a recurring basis | 437,566,265 | 219,396,594 | |
Derivatives - call options | [4] | 0 | 0 |
Derivatives - loan commitments | [4] | (2,464,062) | 0 |
Derivatives - bank loan interest rate swaps, loan commitments | [4] | (231,347) | |
Total liabilities accounted for at fair value on a recurring basis | $ (2,464,062) | $ (231,347) | |
[1] | Fixed maturity securities available for sale | ||
[2] | Mutual funds and equity securities | ||
[3] | Included in other assets on the consolidated balance sheets | ||
[4] | Included in other liabilities and accrued expenses on the consolidated balance sheets |
17) Fair Value of Financial I_4
17) Fair Value of Financial Instruments: Schedule of Effect of Significant Unobservable Inputs (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Loans Held For Sale | ||
Fair Value Balance | $ 422,772,418 | $ 213,457,632 |
Fair Value Measurement With Unobservable Inputs Reconciliation, Recurring Basis, Asset And Liability, Range of Inputs minimum | 99.00% | 98.00% |
Fair Value Measurement With Unobservable Inputs Reconciliation, Recurring Basis, Asset And Liability, Range of Inputs maximum | 110.00% | 109.00% |
Fair Value Measurement With Unobservable Inputs Reconciliation, Recurring Basis, Asset And Liability, Weighted Average | 104.00% | 103.00% |
Net Derivatives Loan Commitments | ||
Fair Value Balance | $ 10,128,610 | $ 2,491,233 |
Fair Value Measurement With Unobservable Inputs Reconciliation, Recurring Basis, Asset And Liability, Range of Inputs minimum | 52.00% | 1.00% |
Fair Value Measurement With Unobservable Inputs Reconciliation, Recurring Basis, Asset And Liability, Range of Inputs maximum | 92.00% | 92.00% |
Fair Value Measurement With Unobservable Inputs Reconciliation, Recurring Basis, Asset And Liability, Weighted Average | 81.00% | 81.00% |
Fixed maturity securities available for sale | ||
Fair Value Balance | $ 2,201,175 | $ 3,216,382 |
17) Fair Value of Financial I_5
17) Fair Value of Financial Instruments: Schedule of Changes in the consolidated balance sheet line items measured (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | |||
Net Derivatives Loan Commitments | ||||
Fair Value Balance | $ 2,491,233 | $ 1,591,816 | ||
Originations/purchases | 0 | 0 | ||
Sales, maturities and paydowns | 0 | 0 | ||
Transfer to mortgage loans held for investment | 0 | 0 | ||
Transfer from fixed maturity securities held to maturity | 0 | |||
Fair Value, Gains (Losses) included in earnings | 7,637,377 | [1] | 899,417 | [2] |
Total gains (losses) included in other comprehensive income | 0 | |||
Fair Value Balance | 10,128,610 | 2,491,233 | ||
Loans Held For Sale | ||||
Fair Value Balance | 213,457,632 | 136,210,853 | ||
Originations/purchases | 5,627,013,749 | 2,606,839,175 | ||
Sales, maturities and paydowns | (5,600,045,285) | (2,580,875,055) | ||
Transfer to mortgage loans held for investment | (16,960,549) | (31,881,851) | ||
Transfer from fixed maturity securities held to maturity | 0 | |||
Fair Value, Gains (Losses) included in earnings | 199,306,871 | [1] | 83,164,510 | [2] |
Total gains (losses) included in other comprehensive income | 0 | |||
Fair Value Balance | 422,772,418 | 213,457,632 | ||
Fixed maturity securities available for sale | ||||
Fair Value Balance | 3,216,382 | 0 | ||
Originations/purchases | 0 | 0 | ||
Sales, maturities and paydowns | (1,042,400) | 0 | ||
Transfer to mortgage loans held for investment | 0 | 0 | ||
Transfer from fixed maturity securities held to maturity | 3,216,382 | |||
Fair Value, Gains (Losses) included in earnings | 3,408 | [3] | 0 | [2] |
Total gains (losses) included in other comprehensive income | 23,785 | |||
Fair Value Balance | $ 2,201,175 | $ 3,216,382 | ||
[1] | As a component of mortgage fee income on the consolidated statements of earnings | |||
[2] | Included in other expenses on the consolidated statements of earnings | |||
[3] | As a component of net investment income on the consolidated statements of earnings |
17) Fair Value of Financial I_6
17) Fair Value of Financial Instruments: Fair Value Assets Measured on a Nonrecurring Basis (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Impaired mortgage loans held for investment | $ 1,297,356 | $ 1,302,025 |
Impaired real estate held for investment | 4,249,000 | 8,375,884 |
Total assets accounted for at fair value on a nonrecurring basis | 5,546,356 | 9,677,909 |
Fair Value, Inputs, Level 1 | ||
Impaired mortgage loans held for investment | 0 | 0 |
Impaired real estate held for investment | 0 | 0 |
Total assets accounted for at fair value on a nonrecurring basis | 0 | 0 |
Fair Value, Inputs, Level 2 | ||
Impaired mortgage loans held for investment | 0 | 0 |
Impaired real estate held for investment | 0 | 0 |
Total assets accounted for at fair value on a nonrecurring basis | 0 | 0 |
Fair Value, Inputs, Level 3 | ||
Impaired mortgage loans held for investment | 1,297,356 | 1,302,025 |
Impaired real estate held for investment | 4,249,000 | 8,375,884 |
Total assets accounted for at fair value on a nonrecurring basis | $ 5,546,356 | $ 9,677,909 |
17) Fair Value of Financial I_7
17) Fair Value of Financial Instruments: Schedule of Financial Instruments Carried at Other Than Fair Value (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Residential Mortgage | ||
Carrying Value | $ 92,757,613 | $ 110,253,678 |
Estimated Carrying Value | 100,384,283 | 115,320,638 |
Residential construction | ||
Carrying Value | 110,849,864 | 88,651,967 |
Estimated Carrying Value | 110,849,864 | 88,651,967 |
Commercial Loan | ||
Carrying Value | 45,736,459 | 37,788,901 |
Estimated Carrying Value | 45,259,425 | 39,289,462 |
Mortgage Loans Net | ||
Carrying Value | 249,343,936 | 236,694,546 |
Estimated Carrying Value | 256,493,572 | 243,262,067 |
Policy Loan | ||
Carrying Value | 14,171,589 | 14,762,805 |
Estimated Carrying Value | 14,171,589 | 14,762,805 |
Insurance Assignments | ||
Carrying Value | 51,585,656 | 39,614,939 |
Estimated Carrying Value | 51,585,656 | 39,614,939 |
Restricted Assets 1 | ||
Carrying Value | 3,317,877 | 2,275,756 |
Estimated Carrying Value | 3,317,877 | 2,289,679 |
Cemetery Perpetual Care Trust Investments | ||
Carrying Value | 1,468,600 | 524,000 |
Estimated Carrying Value | 1,468,600 | 536,553 |
Mortgage Servicing Rights | ||
Carrying Value | 35,210,516 | 17,155,529 |
Estimated Carrying Value | 38,702,358 | 22,784,571 |
Bank And Other Loans Payable | ||
Carrying Value | (297,824,368) | (217,572,612) |
Estimated Carrying Value | (297,824,368) | (217,572,612) |
Policyholder Account Balances | ||
Carrying Value | (44,026,809) | (45,154,180) |
Estimated Carrying Value | (42,220,725) | (41,828,469) |
Future Policy Benefits Annuities | ||
Carrying Value | (106,522,113) | (113,579,830) |
Estimated Carrying Value | (112,354,186) | (117,304,614) |
Fair Value, Inputs, Level 1 | Residential Mortgage | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Residential construction | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Commercial Loan | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Mortgage Loans Net | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Policy Loan | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Insurance Assignments | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Restricted Assets 1 | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Cemetery Perpetual Care Trust Investments | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Mortgage Servicing Rights | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Bank And Other Loans Payable | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Policyholder Account Balances | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 1 | Future Policy Benefits Annuities | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Residential Mortgage | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Residential construction | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Commercial Loan | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Mortgage Loans Net | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Policy Loan | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Insurance Assignments | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Restricted Assets 1 | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Cemetery Perpetual Care Trust Investments | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Mortgage Servicing Rights | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Bank And Other Loans Payable | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Policyholder Account Balances | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 2 | Future Policy Benefits Annuities | ||
Estimated Carrying Value | 0 | 0 |
Fair Value, Inputs, Level 3 | Residential Mortgage | ||
Estimated Carrying Value | 100,384,283 | 115,320,638 |
Fair Value, Inputs, Level 3 | Residential construction | ||
Estimated Carrying Value | 110,849,864 | 88,651,967 |
Fair Value, Inputs, Level 3 | Commercial Loan | ||
Estimated Carrying Value | 45,259,425 | 39,289,462 |
Fair Value, Inputs, Level 3 | Mortgage Loans Net | ||
Estimated Carrying Value | 256,493,572 | 243,262,067 |
Fair Value, Inputs, Level 3 | Policy Loan | ||
Estimated Carrying Value | 14,171,589 | 14,762,805 |
Fair Value, Inputs, Level 3 | Insurance Assignments | ||
Estimated Carrying Value | 51,585,656 | 39,614,939 |
Fair Value, Inputs, Level 3 | Restricted Assets 1 | ||
Estimated Carrying Value | 3,317,877 | 2,289,679 |
Fair Value, Inputs, Level 3 | Cemetery Perpetual Care Trust Investments | ||
Estimated Carrying Value | 1,468,600 | 536,553 |
Fair Value, Inputs, Level 3 | Mortgage Servicing Rights | ||
Estimated Carrying Value | 38,702,358 | 22,784,571 |
Fair Value, Inputs, Level 3 | Bank And Other Loans Payable | ||
Estimated Carrying Value | (297,824,368) | (217,572,612) |
Fair Value, Inputs, Level 3 | Policyholder Account Balances | ||
Estimated Carrying Value | (42,220,725) | (41,828,469) |
Fair Value, Inputs, Level 3 | Future Policy Benefits Annuities | ||
Estimated Carrying Value | $ (112,354,186) | $ (117,304,614) |
18) Accumulated Other Compreh_3
18) Accumulated Other Comprehensive Income: Schedule of Changes in accumulated other comprehensive income (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Equity [Abstract] | ||
Unrealized gains on fixed maturity securities available for sale | $ 12,016,464 | $ 17,315,770 |
Amounts reclassified into net earnings | (2,772) | 0 |
Net unrealized gains before taxes | 12,013,692 | 17,315,770 |
Tax expense | (2,522,876) | (3,636,311) |
Net Unrealized Gain (Loss) | 9,490,816 | 13,679,459 |
Unrealized gains on restricted assets | 41,225 | 35,550 |
Tax expense | (10,269) | (8,856) |
Net | 30,956 | 26,694 |
Unrealized gains on cemetery perpetual care trust investments | (6,817) | 29,904 |
Tax expense | 1,698 | (7,449) |
Net | (5,119) | 22,455 |
Unrealized gains for foreign currency translation adjustments | (46) | 972 |
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax | 12 | (243) |
Other comprehensive income balance, net | (34) | 729 |
Other comprehensive income changes | $ 9,516,619 | $ 13,729,337 |
18) Accumulated Other Compreh_4
18) Accumulated Other Comprehensive Income: Accumulated Balances of Other Comprehensive Income (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Equity [Abstract] | ||||
Increase (Decrease) in Unrealized gains on fixed maturity securities available-for-sale | $ 9,490,816 | $ 13,679,459 | ||
Unrealized gains on fix maturity securities available-for-sale | 23,170,275 | 13,679,459 | $ 0 | |
Increase Dececrease in Unrealized gains on restricted assets | [1] | 30,956 | 26,694 | |
Unrealized gains on restricted assets | [1] | 57,650 | 26,694 | 0 |
Increase Dececrease in Unrealized gains on cemetery perpetual care trust investments | [1] | (5,119) | 22,455 | |
Unrealized gains on cemetery perpetual care trust investments | [1] | 17,336 | 22,455 | 0 |
Increase Decrease Foreign currency translation adjustments | (34) | 729 | ||
Foreign currency translation adjustments | (2,128) | (2,094) | (2,823) | |
Increase (Decrease) in Other comprehensive income (loss), Balance | 9,516,619 | 13,729,337 | ||
Other comprehensive income (loss), Balance | $ 23,243,133 | $ 13,726,514 | $ (2,823) | |
[1] | Included in other expenses on the consolidated statements of earnings |
19) Derivative Instruments_ Sch
19) Derivative Instruments: Schedule of Derivative Assets at Fair Value (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Loan Commitments | ||
Derivative, Notional Amount | $ 659,245,038 | $ 224,202,514 |
Derivative Asset, Notional Amount | 12,592,672 | 2,722,580 |
Derivative Liability, Notional Amount | 2,464,062 | 231,347 |
Call Options | ||
Derivative, Notional Amount | 1,873,200 | 1,813,500 |
Derivative Asset, Notional Amount | 0 | 0 |
Derivative Liability, Notional Amount | 43,097 | 62,265 |
Put Options | ||
Derivative, Notional Amount | 0 | 1,573,100 |
Derivative Asset, Notional Amount | 0 | 0 |
Derivative Liability, Notional Amount | 0 | 22,282 |
Net Derivatives Loan Commitments | ||
Derivative, Notional Amount | 661,118,238 | 227,589,114 |
Derivative Asset, Notional Amount | 12,592,672 | 2,722,580 |
Derivative Liability, Notional Amount | $ 2,507,159 | $ 315,894 |
19) Derivative Instruments_ S_2
19) Derivative Instruments: Schedule of Gains and Losses on Derivatives (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Text Block [Abstract] | ||
Gain (Loss) on Derivatives, Loan Commitments | $ 7,637,377 | $ 899,417 |
Gain (Loss) on Derivatives, Call and put options | $ 272,758 | $ 626,208 |
20) Acquisitions_ Estimated Fai
20) Acquisitions: Estimated Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash received for reinsurance assumed | $ 0 | $ 158,358,594 |
Coinsurance Agreement | ||
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Other investments and policy loans | 9,124,459 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Real estate held for investment | 2,850,000 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Mortgage loans held for investment | 200,000 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Future policy benefits and unpaid claims | (165,404,970) | |
Cash received for reinsurance assumed | 158,358,594 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 12,305,717 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | (170,664,311) | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables | 131,258 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable | (5,259,341) | |
Kilpatrick Life Insurance Co | ||
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Real estate held for investment | 2,708,557 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Mortgage loans held for investment | 8,011,660 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Future policy benefits and unpaid claims | (189,071,407) | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Fixed maturity securities, available for sale | 22,766,520 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Fixed maturity securities, held to maturity | 16,436 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Other investments | 446,655 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Accrued investment income | 183,527 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Investments | 34,133,355 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Receivables from reinsurers | 168,105,064 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 1,498,245 | |
Business Combination, Recognized Identifiable Assets Acquired And Liabilities Assumed, Value of business acquired | 4,962,831 | |
Fair Value of Assets Acquired | 23,779,940 | |
Fair Value of Net Assets Acquired / Consideration Paid, Net of Cash Acquired | 16,879,286 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 221,887,552 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Other | (7,870,944) | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | (198,107,612) | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 6,900,654 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables | 5,407,736 | |
Business Combination Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Assets | 167,344 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other | 712,323 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable | (283,304) | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities | (881,957) | |
Probst Family Funerals and Cremations and Heber Valley Funeral Home | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 2,475,526 | |
Fair Value of Assets Acquired | 3,315,647 | |
Fair Value of Net Assets Acquired / Consideration Paid, Net of Cash Acquired | 3,261,788 | |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net | 754,018 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 3,318,823 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | (3,176) | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 53,859 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables | 13,620 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other | 21,800 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable | $ (3,176) |
20) Acquisitions (Details)
20) Acquisitions (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues | $ 481,463,322 | $ 283,060,930 |
Net earnings | $ 55,596,613 | 10,893,519 |
Kilpatrick Life Insurance Co | ||
Revenues | 1,461,011 | |
Net earnings | 848,031 | |
Probst Family Funerals and Cremations and Heber Valley Funeral Home | ||
Revenues | 796,992 | |
Net earnings | $ 97,400 |
21) Mortgage Servicing Rights_
21) Mortgage Servicing Rights: Schedule of Mortgage Servicing Rights (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Text Block [Abstract] | |||
Balance before valuation allowance at beginning of year | $ 17,155,529 | $ 20,016,822 | |
MSR additions resulting from loan sales | 29,896,465 | 4,194,502 | |
Amortization | [1] | (11,841,478) | (7,055,795) |
Application of valuation allowance to write down MSRs with other than temporary impairment | 0 | 0 | |
Balance before valuation allowance at year end | 35,210,516 | 17,155,529 | |
Mortgage servicing rights, net | 35,210,516 | 17,155,529 | |
Estimated fair value of MSRs at end of period | $ 38,702,358 | $ 22,784,571 | |
[1] | Included in other expenses on the consolidated statements of earnings |
21) Mortgage Servicing Rights_2
21) Mortgage Servicing Rights: Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) | Dec. 31, 2020USD ($) |
Text Block [Abstract] | |
Finite-Lived Intangible Assets, Amortization Expense, Year One | $ 4,724,439 |
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 3,582,811 |
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 3,030,850 |
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 2,574,323 |
Finite-Lived Intangible Assets, Amortization Expense, Year Five | 2,200,840 |
Finite-Lived Intangible Assets, Amortization Expense, after Year Five | 19,097,253 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 35,210,516 |
21) Mortgage Servicing Rights_3
21) Mortgage Servicing Rights: Schedule of Other Revenues (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Other Income | $ 9,246,574 | $ 7,577,641 |
Contractual Servicing Fees | ||
Other Income | 8,940,612 | 7,212,164 |
Late Fees | ||
Other Income | $ 305,962 | $ 365,477 |
21) Mortgage Servicing Rights_4
21) Mortgage Servicing Rights: Summary of Unpaid Principal Balances of the Servicing Portfolio (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Text Block [Abstract] | ||
Servicing Unpaid Principal Balance | $ 5,070,287,864 | $ 2,804,139,415 |
21) Mortgage Servicing Rights_5
21) Mortgage Servicing Rights: Assumptions used in determining MSR value (Details) - Decimal | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Text Block [Abstract] | ||
Prepayment Speeds | 15.60 | 15.30 |
Average Life in Years of MSR | 5 years 3 months 19 days | 5 years 3 months 8 days |
Discount Rate | 9.50 | 9.51 |
22) Future Policy Benefits an_3
22) Future Policy Benefits and Unpaid Claims: Schedule of Liability for Future Policy Benefits (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Gross future policy benefits and unpaid claims | $ 844,790,087 | $ 825,600,918 |
Total receivable from reinsurers | 15,569,156 | 15,747,768 |
Net future policy benefits and unpaid claims | 829,220,931 | 809,853,150 |
Life Insurance Product Line | ||
Gross future policy benefits and unpaid claims | 674,230,463 | 654,585,723 |
Total receivable from reinsurers | 10,841,567 | 11,040,398 |
Fixed Annuity [Member] | ||
Gross future policy benefits and unpaid claims | 109,522,112 | 113,579,831 |
Total receivable from reinsurers | 4,047,301 | 4,038,007 |
Accident and health | ||
Gross future policy benefits and unpaid claims | 651,140 | 667,428 |
Total receivable from reinsurers | 90,231 | 90,113 |
Reported but unpaid claims | ||
Gross future policy benefits and unpaid claims | 8,689,723 | 4,891,922 |
Total receivable from reinsurers | 571,057 | 569,250 |
Incurred but not reported claims | ||
Gross future policy benefits and unpaid claims | 3,315,094 | 2,191,607 |
Total receivable from reinsurers | 19,000 | 10,000 |
Policyholder Account Balances | ||
Gross future policy benefits and unpaid claims | 44,026,809 | 45,154,180 |
Other policyholder funds | ||
Gross future policy benefits and unpaid claims | $ 4,354,746 | $ 4,530,227 |
23) Revenues From Contracts W_3
23) Revenues From Contracts With Customers (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Disclosure Text Block [Abstract] | ||
Deferred pre-need cemetery and mortuary contract revenues | $ 13,080,179 | $ 12,607,978 |
Pre-need merchandise and services | 12,545,753 | 12,325,437 |
At-need specialty merchandise | 534,426 | 282,541 |
Pre-need land sales | 0 | 0 |
Revenue Included in Opening Contract Liability | $ 4,359,709 | $ 3,558,103 |
23) Revenues From Contracts W_4
23) Revenues From Contracts With Customers: Schedule of Balances of Receivables, Assets and Liabilities (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Receivables | $ 10,899,207 | $ 9,236,330 | ||
Deferred pre-need cemetery and mortuary contract revenues | 13,080,179 | 12,607,978 | ||
Receivables | ||||
Receivables | [1] | 4,119,988 | 2,778,879 | $ 2,816,225 |
Increase (Decrease) in Accounts Receivable | [1] | 1,341,109 | (37,346) | |
Contract Asset | ||||
Deferred pre-need cemetery and mortuary contract revenues | 0 | 0 | 0 | |
Increase (Decrease) in Deferred Revenue | 0 | 0 | ||
Contract Liability | ||||
Deferred pre-need cemetery and mortuary contract revenues | 13,080,179 | 12,607,978 | $ 12,508,625 | |
Increase (Decrease) in Deferred Revenue | $ 472,201 | $ 99,353 | ||
[1] | Included in Receivables, net on the consolidated balance sheets |
23) Revenues From Contracts W_5
23) Revenues From Contracts With Customers: Contract Assets and Contract Liabilities (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Pre-need merchandise and services | $ 12,545,753 | $ 12,325,437 | |
At-need specialty merchandise | 534,426 | 282,541 | |
Pre-need land sales | 0 | 0 | |
Deferred pre-need cemetery and mortuary contract revenues | 13,080,179 | 12,607,978 | |
Contract Asset | |||
Pre-need merchandise and services | 0 | 0 | $ 0 |
At-need specialty merchandise | 0 | 0 | 0 |
Pre-need land sales | 0 | 0 | 0 |
Deferred pre-need cemetery and mortuary contract revenues | 0 | 0 | 0 |
Contract Liabilities | |||
Pre-need merchandise and services | 12,545,753 | 12,325,437 | 12,175,943 |
At-need specialty merchandise | 534,426 | 282,541 | 327,302 |
Pre-need land sales | 0 | 0 | 5,380 |
Deferred pre-need cemetery and mortuary contract revenues | $ 13,080,179 | $ 12,607,978 | $ 12,508,625 |
23) Revenues From Contracts W_6
23) Revenues From Contracts With Customers: Revenues of the Cemetery and Mortuary Contracts (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Net mortuary and cemetery sales | $ 20,307,435 | $ 15,296,235 |
Major Goods Or Services Lines, at Need | ||
Net mortuary and cemetery sales | 15,212,822 | 12,334,777 |
Major Goods Or Services Lines, Pre Need | ||
Net mortuary and cemetery sales | 5,094,613 | 2,961,458 |
Timing Of Revenue Recognition, Goods Transferred At A Point In Time | ||
Net mortuary and cemetery sales | 13,438,592 | 10,133,723 |
Timing Of Revenue Recognition, Services Transferred At A Point In Time | ||
Net mortuary and cemetery sales | $ 6,868,843 | $ 5,162,512 |
23) Revenues From Contracts W_7
23) Revenues From Contracts With Customers: Schedule of Contract Costs Included in Deferred Policy (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Disclosure Text Block [Abstract] | ||
Pre-need merchandise and services | $ 3,601,638 | $ 3,590,266 |
At-need specialty merchandise | 5,302 | 10,688 |
Pre-need land sales | 0 | 0 |
Deferred plicy and pre-need contract acquisition costs | $ 3,606,940 | $ 3,600,954 |
24) Leases_ Schedule of Lease C
24) Leases: Schedule of Lease Cost Recognized in Earnings (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | ||
Leases [Abstract] | |||
Finance Lease, Right-of-Use Asset, Amortization | [1] | $ 58,576 | $ 38,351 |
Finance Lease, Interest Expense | [2] | 7,341 | 9,001 |
Operating Lease, Cost | [3] | 5,408,737 | 5,706,490 |
Short-term Lease, Cost | [4] | 222,311 | 233,318 |
Sublease Income | [3] | (394,758) | (663,242) |
Total lease cost | 5,302,207 | 5,323,918 | |
Operating Cash Flows from Operating Leases | 5,293,901 | 5,567,761 | |
Operating Cash Flows from Finance Leases | 7,341 | 9,001 | |
Financing Cash Flows from Finance Leases | 56,982 | 95,931 | |
Right-of-use assets obtained in exchange for operating lease liabilities | 5,631,193 | 16,544,406 | |
Right-of-use assets obtained in exchange for finance lease liabilities | $ 8,494 | $ 252,763 | |
Finance Lease, Weighted Average Remaining Lease Term | 2 years 8 months 26 days | 3 years 2 months 23 days | |
Operating Lease, Weighted Average Remaining Lease Term | 5 years 4 months 24 days | 4 years 8 months 2 days | |
Finance Lease, Weighted Average Discount Rate, Percent | 5.59% | 5.47% | |
Operating Lease, Weighted Average Discount Rate, Percent | 4.87% | 5.06% | |
[1] | Included in Depreciation on property and equipment on the consolidated statements of earnings | ||
[2] | Included in Interest expense on the consolidated statements of earnings | ||
[3] | Included in Rent and rent related expenses on the consolidated statements of earnings | ||
[4] | Includes leases with a term of 12 months or less |
24) Leases_ Schedule of Future
24) Leases: Schedule of Future Minimum Rental Payments for Operating Leases (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Present value of lease liabilities | $ 11,921,884 | $ 11,405,976 |
Finance Leases | ||
2021 | 46,898 | |
2022 | 34,458 | |
2023 | 27,220 | |
2024 | 4,354 | |
2025 | 692 | |
Thereafter | 0 | |
Total undiscounted lease payments | 113,622 | |
Less: Discount on cash flows | (8,671) | |
Present value of lease liabilities | 104,951 | |
Operating Leases | ||
2021 | 4,344,756 | |
2022 | 3,004,271 | |
2023 | 2,088,028 | |
2024 | 1,567,924 | |
2025 | 837,526 | |
Thereafter | 2,938,906 | |
Total undiscounted lease payments | 14,781,411 | |
Less: Discount on cash flows | (2,859,527) | |
Present value of lease liabilities | $ 11,921,884 |
24) Leases_ Right-of-Use Assets
24) Leases: Right-of-Use Assets and Lease Liabilities (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Operating Lease, Right-of-Use Asset | $ 11,663,245 | $ 11,267,247 |
Present value of lease liabilities | 11,921,884 | 11,405,976 |
Right-of-use assets | 254,276 | 248,565 |
Accumulated amortization | (154,144) | (98,351) |
Right-of-use assets, net | 100,132 | 150,214 |
Finance lease liabilities | $ 104,951 | $ 153,439 |