Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

Our provision for income tax expense for 2025, 2024 and 2023 consisted of the following:

	2025		2024			2023
Current income tax expense:
U.S. federal	$	17,813,302	$	11,708,424		$	158,575
State		250,000		250,000			250,000
Deferred income tax expense (benefit):
U.S. federal		188,935	$	(481,744	)	$	229,397
Total income tax expense included in the consolidated statements of income	$	18,252,237	$	11,476,680		$	637,972

Reconciliation of Federal Income Tax Rate

Our effective tax rate is different from the amount computed at the U.S. federal statutory rate of 21%. The reasons for such difference and the related tax effects are as follows:

	2025					2024					2023
Income before income tax expense	$	97,592,977				$	62,338,932				$	5,063,476
Tax at U.S. federal statutory rate		20,494,525		21.0	%		13,091,176		21.0	%		1,063,330		21.0	%
State income taxes, net of federal income tax effect		250,000		0.3			250,000		0.4			250,000		4.9
Nontaxable or nondeductible items:
Tax-exempt interest		(1,506,919	)	(1.5	)		(1,260,114	)	(2.0	)		(1,328,312	)	(26.2	)
Proration		392,676		0.4			329,468		0.5			351,415		6.9
Dividends received deduction		(63,786	)	(0.1	)		(57,759	)	(0.1	)		(77,348	)	(1.5	)
Stock options		(895,639	)	(0.9	)		101,600		0.2			595,602		11.8
Fixed-maturity dispositions		—		—			(585,845	)	(0.9	)		—		—
Other adjustments:
Unrealized gain on equity securities		(1,060,494	)	(1.1	)		(1,054,875	)	(1.7	)		(572,213	)	(11.3	)
Additional tax paid for prior year		179,457		0.2			(5,157	)	(0.1	)		159,261		3.1
Other, net		462,417		0.4			668,186		1.1			196,237		3.9
Income tax expense	$	18,252,237		18.7	%	$	11,476,680		18.4	%	$	637,972		12.6	%

Income Taxes Paid

Income taxes paid were as follows:

	2025		2024		2023
U.S. federal	$	22,447,439	$	3,500,000	$	—
State		250,050		250,050		250,050
Total	$	22,697,489	$	3,750,050	$	250,050

Deferred Tax Assets and Deferred Tax Liabilities

The tax effects of temporary differences that give rise to significant portions of our deferred tax assets and deferred tax liabilities at December 31, 2025 and 2024 are as follows:

	2025			2024
Deferred tax assets:
Unearned premium	$	17,690,466		$	18,377,475
Loss reserves		11,054,832			10,579,697
Net unrealized losses		2,205,197			7,498,822
Net state operating loss carryforward - DGI Parent		7,508,094			7,581,066
Other		850,843			1,035,322
Total gross deferred tax assets		39,309,432			45,072,382
Less valuation allowance		(7,508,094	)		(7,581,066	)
Net deferred tax assets		31,801,338			37,491,316
Deferred tax liabilities:
Deferred policy acquisition costs		14,420,695			15,402,863
Loss reserve transition adjustment		—			271,738
Other		4,093,342			3,046,854
Total gross deferred tax liabilities		18,514,037			18,721,455
Net deferred tax asset	$	13,287,301		$	18,769,861