| Nevada                                                                               | 95-2583928                  |
|--------------------------------------------------------------------------------------|-----------------------------|
| (State or Other Jurisdiction      of                                            |  (I.R.S.      Employee |
|  Incorporation or      Organization)                                            | Identification      No.)    |
|                                                                                 |                        |
|  23251 Mulholland      Drive,  Woodland Hills, California  91364 |
|  (Address of Principal Executive      Offices)  (Zip    Code)              |

----

|                                                                                                                                                                                       |   | September      30 |        |   | December      31 |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|-------------|--------|------------------|--------|
|                                                                                                                                                                                       |   | 2008              |        |   | 2007             |   |
|                                                                                                                                                                                       |   | (Unaudited)       |        |   |             |   |
| ASSETS                                                                                                                                                                                     |   |              |        |   |             |   |
| Investments                                                                                                                                                                                |   |              |        |   |             |   |
|    Available      for sale:                                                                                                                                                 |   |              |        |   |             |   |
|           Fixed maturities, at fair value (amortized      cost:  September 30, 2008  $140,849,488; December 31,      2007  $139,992,208) |   | $                 | 144,765,728 |   |             | $      | 142,895,472 |   |
|    Short-term      investments, at cost                                                                                                                                     |   |              | 5,097,351   |   |             |   | 7,356,159 |   |
| Total    Investments                                                                                                                                                                       |   |              | 149,863,079 |   |             |   | 150,251,631 |   |
| Cash                                                                                                                                                                                       |   |              | 24,962      |   |             |   | 108,864 |   |
| Accrued      investment income                                                                                                                                                             |   |              | 1,181,251   |   |             |   | 1,554,741 |   |
| Premiums      and notes receivable, net                                                                                                                                                    |   |              | 5,151,075   |   |             |   | 5,066,646 |   |
| Reinsurance      recoverable:                                                                                                                                                              |   |              |        |   |             |   |   |   |
|    Paid      losses and loss adjustment expenses                                                                                                                            |   |              | 1,281,276   |   |             |   | 318,186 |   |
|    Unpaid      losses and loss adjustment expenses                                                                                                                          |   |              | 20,638,231  |   |             |   | 28,425,424 |   |
| Deferred      policy acquisition costs                                                                                                                                                     |   |              | 5,322,049   |   |             |   | 5,722,847 |   |
| Property      and equipment (net of accumulated depreciation)                                                                                                                              |   |              | 403,533     |   |             |   | 557,234 |   |
| Deferred      income taxes                                                                                                                                                                 |   |              | 316,408     |   |             |   | 686,910 |   |
| Other      assets                                                                                                                                                                          |   |              | 530,643     |   |             |   | 1,083,378 |   |
| Total Assets                                                                                                                                                                               |   | $                 | 184,712,507 |   |             | $      | 193,775,861 |   |
|                                                                                                                                                                                       |   |              |        |   |             |   |   |   |
| LIABILITIES AND STOCKHOLDERS'      EQUITY                                                                                                                                                  |   |              |        |   |             |   |   |   |
| LIABILITIES                                                                                                                                                                                |   |              |        |   |             |   |   |   |
| Unpaid      losses and loss adjustment expenses                                                                                                                                            |   | $                 | 82,524,478  |   |             | $      | 94,730,711 |   |
| Unearned      premiums                                                                                                                                                                     |   |              | 20,495,916  |   |             |   | 22,742,612 |   |
| Advance      premium and premium deposits                                                                                                                                                  |   |              | 1,599,458   |   |             |   | 2,159,290 |   |
| Income      taxes payable                                                                                                                                                                  |   |              | 241,906     |   |             |   | - |   |
| Accrued      expenses and other liabilities                                                                                                                                                |   |              | 6,991,287   |   |             |   | 5,040,145 |   |
| Total    Liabilities                                                                                                                                                                       |   | $                 | 111,853,045 |   |             | $      | 124,672,758 |   |
|                                                                                                                                                                                       |   |              |        |   |             |   |   |   |
| STOCKHOLDERS'  EQUITY                                                                                                                                                            |   |              |        |   |             |   |   |   |
| Common      stock, no par – authorized 10,000,000 shares; issued      and outstanding shares 5,613,808 at                                                                       |   |              |        |   |             |   |   |   |
|         September 30, 2008, and 5,625,308 at December 31,    2007                                                                                                                |   | $                 | 3,588,507   |   |             | $      | 3,594,207 |   |
| Accumulated      other comprehensive income                                                                                                                                                |   |              | 2,584,718   |   |             |   | 1,916,154 |   |
| Retained      earnings                                                                                                                                                                     |   |              | 66,686,237  |   |             |   | 63,592,742 |   |
| Total Stockholders’      Equity                                                                                                                                                      |   | $                 | 72,859,462  |   |             | $      | 69,103,103 |   |
|                                                                                                                                                                                       |   |              |        |   |             |   |   |   |
| Total Liabilities and      Stockholders' Equity                                                                                                                                            |   | $                 | 184,712,507 |   |             | $      | 193,775,861 |   |

----

|                                                                |   | Three      Months Ended |       |   | Nine      Months Ended |   |
|---------------------------------------------------------------------|--------|-------------------------|------------|--------|------------------------|--------|
|                                                                |   | September 30            |       |   | September 30           |   |
|                                                                |   | 2008                    |       |   | 2007                   |   |   | 2008 |   |   | 2007 |   |
| REVENUES                                                            |   |                    |       |   |                   |   |   |   |   |   |   |   |
| Insurance      Company Revenues                                     |   |                    |       |   |                   |   |   |   |   |   |   |   |
|   Premium      earned                                     |   | $                       | 10,566,831 |   |                   | $      | 12,053,155 |   |   | $ | 32,519,317 |   |   | $ | 37,185,654 |   |
|   Premium      ceded                                      |   |                    | 2,199,769  |   |                   |   | 2,853,754 |   |   |   | 6,646,493 |   |   |   | 8,793,510 |   |
|      Net      premium earned               |   |                    | 8,367,062  |   |                   |   | 9,199,401 |   |   |   | 25,872,824 |   |   |   | 28,392,144 |   |
|   Net      investment income                              |   |                    | 1,415,072  |   |                   |   | 1,716,618 |   |   |   | 4,493,258 |   |   |   | 4,999,898 |   |
| Net      realized investment gains                                  |   |                    | -          |   |                   |   | - |   |   |   | 6,306 |   |   |   | - |   |
|   Other      income                                       |   |                    | 209,242    |   |                   |   | 27,740 |   |   |   | 531,425 |   |   |   | 57,240 |   |
|      Total      Insurance Company Revenues |   |                    | 9,991,376  |   |                   |   | 10,943,759 |   |   |   | 30,903,813 |   |   |   | 33,449,282 |   |
|                                                                |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Other      Revenues from Insurance Operations                       |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|   Gross      commissions and fees                         |   |                    | 1,412,911  |   |                   |   | 1,381,203 |   |   |   | 4,299,668 |   |   |   | 4,096,100 |   |
|   Investment      income                                  |   |                    | 10,319     |   |                   |   | 36,993 |   |   |   | 51,396 |   |   |   | 115,142 |   |
|   Finance      charges and fees                           |   |                    | 110,255    |   |                   |   | 133,463 |   |   |   | 353,787 |   |   |   | 424,487 |   |
|   Other      income                                       |   |                    | 4,271      |   |                   |   | 3,298 |   |   |   | 10,982 |   |   |   | 9,794 |   |
|      Total      Revenues                   |   |                    | 11,529,132 |   |                   |   | 12,498,716 |   |   |   | 35,619,646 |   |   |   | 38,094,805 |   |
|                                                                |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| EXPENSES                                                            |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Losses      and loss adjustment expenses                            |   |                    | 4,750,265  |   |                   |   | 5,685,253 |   |   |   | 17,026,560 |   |   |   | 17,103,329 |   |
| Policy      acquisition costs                                       |   |                    | 2,055,828  |   |                   |   | 2,096,113 |   |   |   | 6,213,989 |   |   |   | 6,396,708 |   |
|        Salaries and employee benefits                          |   |                    | 1,493,937  |   |                   |   | 1,431,967 |   |   |   | 4,329,374 |   |   |   | 4,316,618 |   |
|        Commissions to agents/brokers                           |   |                    | 320,334    |   |                   |   | 266,661 |   |   |   | 959,986 |   |   |   | 707,158 |   |
|        Other operating expenses                                |   |                    | 716,478    |   |                   |   | 827,958 |   |   |   | 2,284,960 |   |   |   | 2,291,805 |   |
|      Total      Expenses                   |   |                    | 9,336,842  |   |                   |   | 10,307,952 |   |   |   | 30,814,869 |   |   |   | 30,815,618 |   |
|                                                                |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Income      Before Taxes                                            |   |                    | 2,192,290  |   |                   |   | 2,190,764 |   |   |   | 4,804,777 |   |   |   | 7,279,187 |   |
| Income      tax provision                                           |   |                    | 746,950    |   |                   |   | 644,325 |   |   |   | 1,618,487 |   |   |   | 2,344,478 |   |
|      Net      Income                  |   | $                       | 1,445,340  |   |                   | $      | 1,546,439 |   |   | $ | 3,186,290 |   |   | $ | 4,934,709 |   |
|                                                                |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| PER      SHARE DATA:                                                |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                               |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|     Earnings      Per Share                     |   | $                       | 0.26       |   |                   | $      | 0.27 |   |   | $ | 0.57 |   |   | $ | 0.88 |   |
|     Weighted      Average Shares                |   |                    | 5,624,188  |   |                   |   | 5,624,724 |   |   |   | 5,624,935 |   |   |   | 5,610,274 |   |
| Diluted                                                             |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|     Earnings      Per Share                     |   | $                       | 0.26       |   |                   | $      | 0.27 |   |   | $ | 0.56 |   |   | $ | 0.87 |   |
|     Weighted      Average Shares                |   |                    | 5,664,525  |   |                   |   | 5,686,097 |   |   |   | 5,667,509 |   |   |   | 5,682,751 |   |

----

|                                                                                                                                   |   | Three      Months Ended |      |   | Nine      Months Ended |   |
|----------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------|-----------|--------|------------------------|--------|
|                                                                                                                                   |   | September 30            |      |   | September 30           |   |
|                                                                                                                                   |   | 2008                    |      |   | 2007                   |   |   | 2008 |   |   | 2007 |   |
|                                                                                                                                   |   |                    |      |   |                   |   |   |   |   |   |   |   |
| Net      Income                                                                                                                        |   | $                       | 1,445,340 |   |                   | $      | 1,546,439 |   |   | $ | 3,186,290 |   |   | $ | 4,934,709 |   |
| Other      changes in comprehensive income, net of tax:                                                                                |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|      Unrealized      gains on securities classified as available-for-sale arising during      the period |   |                    | 749,683   |   |                   |   | 1,021,881 |   |   |   | 668,564 |   |   |   | 963,551 |   |
|             Comprehensive      Income                                      |   | $                       | 2,195,023 |   |                   | $      | 2,568,320 |   |   | $ | 3,854,854 |   |   | $ | 5,898,260 |   |

----

|                                                                                            |   | For      the Nine Months Ended |          |
|-------------------------------------------------------------------------------------------------|--------|--------------------------------|---------------|
|                                                                                            |   | September 30                   |          |
|                                                                                            |   | 2008                           |          |   | 2007 |   |
| Cash      Flows from Operating Activities:                                                      |   |                           |          |   |   |   |
|    Net      Income                                                               |   | $                              | 3,186,290     |   |   | $ | 4,934,709 |   |
|    Adjustments      to reconcile net income to net cash from operations          |   |                           |          |   |   |   |   |   |
|       Depreciation                                                |   |                           | 158,955       |   |   |   | 182,317 |   |
|       Bond      amortization, net                                 |   |                           | 194,293       |   |   |   | (44,746 | ) |
|       Net      realized investment gains                          |   |                           | (6,306        | ) |   |   | - |   |
|    Changes      in assets and liabilities                                        |   |                           |          |   |   |   |   |   |
|       Premium,      notes, and investment income receivable       |   |                           | 289,061       |   |   |   | 365,821 |   |
|       Reinsurance      recoverable                                |   |                           | 6,824,103     |   |   |   | (2,390,503 | ) |
|       Deferred      policy acquisitions costs                     |   |                           | 400,798       |   |   |   | 578,421 |   |
|       Other      assets                                           |   |                           | 153,953       |   |   |   | (42,320 | ) |
|       Reserve      for unpaid losses and loss adjustment expenses |   |                           | (12,206,233   | ) |   |   | (492,115 | ) |
|       Unearned      premium reserve                               |   |                           | (2,246,696    | ) |   |   | (3,309,743 | ) |
|       Funds      held as security and advanced premiums           |   |                           | (559,832      | ) |   |   | 694,160 |   |
|       Accrued      expenses and other liabilities                 |   |                           | 1,951,142     |   |   |   | 764,152 |   |
|       Tax      benefit from disqualified incentive stock options  |   |                           | -             |   |   |   | (129,402 | ) |
|       Income      taxes current/deferred                          |   |                           |  666,778 |   |   |   | (1,865,761 | ) |
| Net Cash (Used in)      Operations                                                              |   |                           | (1,193,694    | ) |   |   | (755,010 | ) |
|                                                                                            |   |                           |          |   |   |   |   |   |
| Investing      Activities                                                                       |   |                           |          |   |   |   |   |   |
| Purchase of fixed maturity      investments                                                     |   |                           | (61,561,017   | ) |   |   | (44,609,678 | ) |
| Proceeds from maturity of fixed      maturity investments                                       |   |                           | 60,010,000    |   |   |   | 45,700,000 |   |
| Proceeds from sale of fixed      maturity investments                                           |   |                           | 505,750       |   |   |   | - |   |
| Net decrease (increase) in      short-term investments                                          |   |                           | 2,258,808     |   |   |   | (524,800 | ) |
| Additions to property and      equipment                                                        |   |                           | (5,254        | ) |   |   | (82,014 | ) |
| Net Cash Provided by Investing      Activities                                                  |   |                           | 1,208,287     |   |   |   | 483,508 |   |
|                                                                                            |   |                           |          |   |   |   |   |   |
| Financing      Activities                                                                       |   |                           |          |   |   |   |   |   |
| Proceeds from exercise of stock      options                                                    |   |                           | -             |   |   |   | 301,025 |   |
|         Tax benefit from disqualified incentive stock options                         |   |                           | -             |   |   |   | 129,402 |   |
| Repurchase of common      stock                                                                 |   |                           | (98,495       | ) |   |   | (115,261 | ) |
| Net Cash (Used in) Provided by      Financing Activities                                        |   |                           | (98,495       | ) |   |   | 315,166 |   |
|                                                                                            |   |                           |          |   |   |   |   |   |
| Net      (decrease) increase  in cash                                                 |   |                           | (83,902       | ) |   |   | 43,664 |   |
| Cash at beginning of      period                                                                |   |                           | 108,864       |   |   |   | 34,535 |   |
| Cash at End of      Period                                                                      |   | $                              | 24,962        |   |   | $ | 78,199 |   |
|                                                                                            |   |                           |          |   |   |   |   |   |
| Supplemental      Cash Flow Information                                                         |   |                           |          |   |   |   |   |   |
| Cash paid during the period for      income taxes                                               |   | $                              | 950,240       |   |   | $ | 4,200,701 |   |

----

----

|                                        |   | Consolidated      Balance SheetFor the year ended December 31,      2007 |       |
|---------------------------------------------|--------|--------------------------------------------------------------------------|------------|
|                                        |   | As      previously reported                                              |       |   | Correction |   |   | As corrected |   |
|                                        |   |                                                                     |       |   |   |   |   |   |   |
| Deferred      income taxes                  |   | $                                                                        | 295,026    |   |   | $ | 391,884 |   |   | $ | 686,910 |   |
| Accrued      expenses and other liabilities |   | $                                                                        | 3,887,546  |   |   | $ | 1,152,599 |   |   | $ | 5,040,145 |   |
| Retained      earnings                      |   | $                                                                        | 64,353,457 |   |   | $ | (760,715 | ) |   | $ | 63,592,742 |   |

|                           |   | Consolidated      Statement of OperationFor      the three months endedSeptember 30, 2007 |       |   | Consolidated      Statement of OperationFor      the nine months endedSeptember 30, 2007 |   |
|--------------------------------|--------|-------------------------------------------------------------------------------------------|------------|--------|------------------------------------------------------------------------------------------|--------|
|                           |   | As      previously reported                                                               |       |   | Correction                                                                               |   |   | As corrected |   |   | As      previously reported |   |   | Correction |   |   | As corrected |   |
|                           |   |                                                                                      |       |   |                                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross      commission and fees |   | $                                                                                         | 1,362,736  |   |                                                                                     | $      | 18,467 |   |   | $ | 1,381,203 |   |   | $ | 3,966,485 |   |   | $ | 129,615 |   |   | $ | 4,096,100 |   |
| Total      revenues            |   | $                                                                                         | 12,480,249 |   |                                                                                     | $      | 18,467 |   |   | $ | 12,498,716 |   |   | $ | 37,965,190 |   |   | $ | 129,615 |   |   | $ | 38,094,805 |   |
| Income      before taxes       |   | $                                                                                         | 2,172,297  |   |                                                                                     | $      | 18,467 |   |   | $ | 2,190,764 |   |   | $ | 7,149,572 |   |   | $ | 129,615 |   |   | $ | 7,279,187 |   |
| Income      tax provision      |   | $                                                                                         | 638,046    |   |                                                                                     | $      | 6,279 |   |   | $ | 644,325 |   |   | $ | 2,300,409 |   |   | $ | 44,069 |   |   | $ | 2,344,478 |   |
| Net      income                |   | $                                                                                         | 1,534,251  |   |                                                                                     | $      | 12,188 |   |   | $ | 1,546,439 |   |   | $ | 4,849,163 |   |   | $ | 85,546 |   |   | $ | 4,934,709 |   |

|                      |   | Statement      of Comprehensive IncomeFor      the three months endedSeptember 30, 2007 |      |   | Statement      of Comprehensive IncomeFor      the nine months endedSeptember 30, 2007 |   |
|---------------------------|--------|----------------------------------------------------------------------------------------------|-----------|--------|----------------------------------------------------------------------------------------|--------|
|                      |   | As      previously reported                                                                  |      |   | Correction                                                                             |   |   | As corrected |   |   | As      previously reported |   |   | Correction |   |   | As corrected |   |
|                      |   |                                                                                         |      |   |                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      income           |   | $                                                                                            | 1,534,251 |   |                                                                                   | $      | 12,188 |   |   | $ | 1,546,439 |   |   | $ | 4,849,163 |   |   | $ | 85,546 |   |   | $ | 4,934,709 |   |
| Comprehensive      income |   | $                                                                                            | 2,556,132 |   |                                                                                   | $      | 12,188 |   |   | $ | 2,568,320 |   |   | $ | 5,812,714 |   |   | $ | 85,546 |   |   | $ | 5,898,260 |   |

|                                        |   | Consolidated      Statement of Cash FlowFor the nine months ended September 30,      2007 |       |
|---------------------------------------------|--------|-------------------------------------------------------------------------------------------|------------|
|                                        |   | As      previously reported                                                               |       |   | Correction |   |   | As corrected |   |
|                                        |   |                                                                                      |       |   |   |   |   |   |   |
| Net      income                             |   | $                                                                                         | 4,849,163  |   |   | $ | 85,546 |   |   | $ | 4,934,709 |   |
| Accrued      expenses and other liabilities |   | $                                                                                         | 893,767    |   |   | $ | (129,615 | ) |   | $ | 764,152 |   |
| Income      taxes current/deferred          |   | $                                                                                         | (1,909,830 | ) |   | $ | 44,069 |   |   | $ | (1,865,761 | ) |

----

|                                                          |   | Three      Months Ended |      |   | Nine      Months Ended |   |
|---------------------------------------------------------------|--------|-------------------------|-----------|--------|------------------------|--------|
|                                                          |   | September 30            |      |   | September 30           |   |
|                                                          |   | 2008                    |      |   | 2007                   |   |   | 2008 |   |   | 2007 |   |
| Basic Earnings Per Share                                      |   |                    |      |   |                   |   |   |   |   |   |   |   |
| Net      income numerator                                     |   | $                       | 1,445,340 |   |                   | $      | 1,546,439 |   |   | $ | 3,186,290 |   |   | $ | 4,934,709 |   |
|                                                          |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted      average shares outstanding denominator          |   |                    | 5,624,188 |   |                   |   | 5,624,724 |   |   |   | 5,624,935 |   |   |   | 5,610,274 |   |
|                                                          |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|      Basic      Earnings Per Share   |   | $                       | 0.26      |   |                   | $      | 0.27 |   |   | $ | 0.57 |   |   | $ | 0.88 |   |
|                                                          |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted Earnings Per Share                                    |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Net      income numerator                                     |   | $                       | 1,445,340 |   |                   | $      | 1,546,439 |   |   | $ | 3,186,290 |   |   | $ | 4,934,709 |   |
|                                                          |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted      average shares outstanding                      |   |                    | 5,624,188 |   |                   |   | 5,624,724 |   |   |   | 5,624,935 |   |   |   | 5,610,274 |   |
| Effect      of diluted securities                             |   |                    | 40,337    |   |                   |   | 61,373 |   |   |   | 42,574 |   |   |   | 72,477 |   |
| Diluted      shares outstanding denominator                   |   |                    | 5,664,525 |   |                   |   | 5,686,097 |   |   |   | 5,667,509 |   |   |   | 5,682,751 |   |
|                                                          |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|      Diluted      Earnings Per Share |   | $                       | 0.26      |   |                   | $      | 0.27 |   |   | $ | 0.56 |   |   | $ | 0.87 |   |

----

----

|                                                    |   | Three      Months Ended |       |   | Nine      Months Ended |   |
|---------------------------------------------------------|--------|-------------------------|------------|--------|------------------------|--------|
|                                                    |   | September 30            |       |   | September 30           |   |
|                                                    |   | 2008                    |       |   | 2007                   |   |   | 2008 |   |   | 2007 |   |
| Revenues                                                |   |                    |       |   |                   |   |   |   |   |   |   |   |
| Insurance      company operation                        |   | $                       | 9,991,376  |   |                   | $      | 10,943,759 |   |   | $ | 30,903,813 |   |   | $ | 33,449,282 |   |
|                                                    |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Other      insurance operations                         |   |                    | 4,419,131  |   |                   |   | 4,706,130 |   |   |   | 13,169,590 |   |   |   | 14,060,513 |   |
| Intersegment      eliminations (1)                      |   |                    | (2,881,375 | )      |                   |   | (3,151,173 | ) |   |   | (8,453,757 | ) |   |   | (9,414,990 | ) |
|    Total      other insurance operations |   |                    | 1,537,756  |   |                   |   | 1,554,957 |   |   |   | 4,715,833 |   |   |   | 4,645,523 |   |
|                                                    |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|    Total      Revenues                   |   | $                       | 11,529,132 |   |                   | $      | 12,498,716 |   |   | $ | 35,619,646 |   |   | $ | 38,094,805 |   |
|                                                    |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Income (Loss) Before Income      Taxes                  |   |                    |       |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Insurance      company operation                        |   | $                       | 2,701,615  |   |                   | $      | 2,618,111 |   |   | $ | 6,611,699 |   |   | $ | 8,842,737 |   |
| Other      insurance operations                         |   |                    | (509,325   | )      |                   |   | (427,347 | ) |   |   | (1,806,922 | ) |   |   | (1,563,550 | ) |
|    Total      income before income taxes |   | $                       | 2,192,290  |   |                   | $      | 2,190,764 |   |   | $ | 4,804,777 |   |   | $ | 7,279,187 |   |

|                                                                       |   | As of        |             |
|----------------------------------------------------------------------------|--------|--------------|------------------|
|                                                                       |   | September 30 |             |   | December 31 |   |
|                                                                       |   | 2008         |             |   | 2007 |   |
| Assets                                                                     |   |         |             |   |   |   |
| Insurance      company operation                                           |   | $            | 170,520,181      |   |   | $ | 177,278,243 |   |
| Intersegment      eliminations (2)                                         |   |         |  (1,665,061 | ) |   |   |  (1,537,590 | ) |
|      Total      insurance company operation  |   |         | 168,855,120      |   |   |   | 175,740,653 |   |
| Other      insurance operations                                            |   |         | 15,857,387       |   |   |   | 18,035,208 |   |
|      Total      assets                            |   | $            | 184,712,507      |   |   | $ | 193,775,861 |   |

| (1)   | Intersegment      revenue eliminations reflect commission paid by Crusader to Unifax      Insurance Systems, Inc., (Unifax) a wholly owned subsidiary of the      Company. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)   | Intersegment      asset eliminations reflect the elimination of Crusader receivables and      Unifax payables. |
|-----------------|----------------------------------------------------------------------------------------------------------------|

----

----

|                                                                                                                       |   | Three Months Ended September    30 |      |   | Nine Months Ended September    30 |   |
|----------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------|-----------|--------|-----------------------------------|--------|
|                                                                                                                       |   |                               |      |   | Increase                          |   |   |   |   |   | Increase |   |
|                                                                                                                       |   | 2008                               |      |   | 2007                              |   |   | (Decrease) |   |   | 2008 |   |   | 2007 |   |   | (Decrease) |   |
|                                                                                                                       |   |                               |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      premium earned                                                                                                    |   | $                                  | 8,367,062 |   |                              | $      | 9,199,401 |   |   | $ | (832,339 | ) |   | $ | 25,872,824 |   |   | $ | 28,392,144 |   |   | $ | (2,519,320 | ) |
|                                                                                                                       |   |                               |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Less:                                                                                                                      |   |                               |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Losses      and loss adjustment expenses                                                                              |   |                               | 4,750,265 |   |                              |   | 5,685,253 |   |   |   | (934,988 | ) |   |   | 17,026,560 |   |   |   | 17,103,329 |   |   |   | (76,769 | ) |
| Policy      acquisition costs                                                                                              |   |                               | 2,055,828 |   |                              |   | 2,096,113 |   |   |   | (40,285 | ) |   |   | 6,213,989 |   |   |   | 6,396,708 |   |   |   | (182,719 | ) |
|      Total                                                                                        |   |                               | 6,806,093 |   |                              |   | 7,781,366 |   |   |   | (975,273 | ) |   |   | 23,240,549 |   |   |   | 23,500,037 |   |   |   | (259,488 | ) |
|                                                                                                                       |   |                               |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Underwriting      Profit            (Before      Income Taxes) |   | $                                  | 1,560,969 |   |                              | $      | 1,418,035 |   |   | $ | 142,934 |   |   | $ | 2,632,275 |   |   | $ | 4,892,107 |   |   | $ | (2,259,832 | ) |

|                                                        |   | Three Months Ended September    30 |      |   | Nine Months Ended September    30 |   |
|-------------------------------------------------------------|--------|------------------------------------|-----------|--------|-----------------------------------|--------|
|                                                        |   |                               |      |   |                              |   |   | Increase |   |   |   |   |   |   |   |   | Increase |   |
|                                                        |   | 2008                               |      |   | 2007                              |   |   | (Decrease) |   |   | 2008 |   |   | 2007 |   |   | (Decrease) |   |
| Losses      and loss  adjustment      expenses    |   |                               |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current      accident year                                  |   | $                                  | 5,798,936 |   |                              | $      | 6,796,662 |   |   | $ | (997,726 | ) |   | $ | 18,731,978 |   |   | $ | 20,188,504 |   |   | $ | (1,456,526 | ) |
| Favorable      development of      all prior accident years |   |                               | 1,048,671 |   |                              |   | 1,111,409 |   |   |   |   62,738 |   |   |   |  1,705,418 |   |   |   |  3,085,175 |   |   |   |  1,379,757 |   |
| Total                                                       |   | $                                  | 4,750,265 |   |                              | $      | 5,685,253 |   |   | $ | (934,988 | ) |   | $ | 17,026,560 |   |   | $ | 17,103,329 |   |   | $ | (76,769 | ) |

----

----

----

|                                                                                                         |   | Three Months Ended September    30 |       |   | Nine Months Ended September    30 |   |
|--------------------------------------------------------------------------------------------------------------|--------|------------------------------------|------------|--------|-----------------------------------|--------|
|                                                                                                         |   |                               |       |   |                              |   |   | Increase |   |   |   |   |   |   |   |   | Increase |   |
|                                                                                                         |   | 2008                               |       |   | 2007                              |   |   | (Decrease) |   |   | 2008 |   |   | 2007 |   |   | (Decrease) |   |
|                                                                                                         |   |                               |       |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Direct      earned premium                                                                                   |   | $                                  | 10,566,831 |   |                              | $      | 12,053,155 |   |   | $ | (1,486,324 | ) |   | $ | 32,519,317 |   |   | $ | 37,185,654 |   |   | $ | (4,666,337 | ) |
| Earned      ceded premium:                                                                                   |   |                               |       |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Excluding      provisionally rated ceded premium                                                             |   |                               | 2,199,742  |   |                              |   | 2,852,967 |   |   |   | (653,225 | ) |   |   | 6,726,302 |   |   |   | 8,822,079 |   |   |   | (2,095,777 | ) |
| Provisionally      rated ceded premium                                                                       |   |                               | 27         |   |                              |   | 787 |   |   |   | (760 | ) |   |   | (79,809 | ) |   |   | (28,569 | ) |   |   | (51,240 | ) |
|    Total      Earned Ceded Premium                                                            |   |                               | 2,199,769  |   |                              |   | 2,853,754 |   |   |   | (653,985 | ) |   |   | 6,646,493 |   |   |   | 8,793,510 |   |   |   | (2,147,017 | ) |
|                                                                                                         |   |                               |       |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Ceding      commission                                                                                       |   |                               | (653,296   | )      |                              |   | (875,065 | ) |   |   | 221,769 |   |   |   | (2,010,939 | ) |   |   | (2,706,611 | ) |   |   | 695,672 |   |
|                                                                                                         |   |                               |       |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Total      Earned Ceded Premium     Net of Ceding      Commission |   | $                                  | 1,546,473  |   |                              | $      | 1,978,689 |   |   | $ | (432,216 | ) |   | $ | 4,635,554 |   |   | $ | 6,086,899 |   |   | $ | (1,451,345 | ) |

----

|                                                       |   | Three Months Ended September    30 |        |   | Nine Months Ended September    30 |   |
|------------------------------------------------------------|--------|------------------------------------|-------------|--------|-----------------------------------|--------|
|                                                       |   | 2008                               |        |   | 2007                              |   |   | 2008 |   |   | 2007 |   |
|                                                       |   |                               |        |   |                              |   |   |   |   |   |   |   |
| Average      Invested Assets*                              |   | $                                  | 145,521,741 |   |                              | $      | 146,845,497 |   |   | $ | 146,647,603 |   |   | $ | 147,051,948 |   |
| Total      Investment Income                               |   | $                                  | 1,425,391   |   |                              | $      | 1,753,611 |   |   | $ | 4,544,654 |   |   | $ | 5,115,040 |   |
| Annualized      Yield on Average      Invested Assets |   |                               | 3.9         | %      |                              |   | 4.8 | % |   |   | 4.1 | % |   |   | 4.6 | % |

|   | *      The average is based on the beginning and ending balance of the amortized      cost of the invested assets. |
|--------|--------------------------------------------------------------------------------------------------------------------|

|     Maturities      by   Calendar Year |   |  Par Value |        |   |   Amortized Cost |   |        |   Fair Value |   |   | Weighted      Average      Yield |   |
|---------------------------------------------------------------------------|--------|----------------------|-------------|--------|----------------------------|--------|-------------|------------------------|--------|--------|----------------------------------|--------|
|                                                                      |   |                 |        |   |                       |   |        |                   |   |   |                             |   |
| December      31, 2008                                                    |   | $                    | 7,250,000   |   |                       | $      | 7,257,244   |                   |   | $      | 7,299,766                        |   |   |   | 4.5 | % |
| December      31, 2009                                                    |   |                 | 42,700,000  |   |                       |   | 42,949,460  |                   |   |   | 43,514,793                       |   |   |   | 4.1 | % |
| December      31, 2010                                                    |   |                 | 34,200,000  |   |                       |   | 34,239,372  |                   |   |   | 34,547,029                       |   |   |   | 2.4 | % |
| December      31, 2011                                                    |   |                 | 9,250,000   |   |                       |   | 9,349,034   |                   |   |   | 9,846,953                        |   |   |   | 4.1 | % |
| December      31, 2012                                                    |   |                 | 38,000,000  |   |                       |   | 37,963,096  |                   |   |   | 40,341,250                       |   |   |   | 4.4 | % |
| December      31, 2013                                                    |   |                 | 9,100,000   |   |                       |   | 9,091,282   |                   |   |   | 9,215,937                        |   |   |   | 3.3 | % |
|    Total                                                   |   | $                    | 140,500,000 |   |                       | $      | 140,849,488 |                   |   | $      | 144,765,728                      |   |   |   | 3.8 | % |

|                |   | Market |      |   | Gross           |   |
|---------------------|--------|--------|-----------|--------|-----------------|--------|
|                |   | Value  |      |   | Unrealized Loss |   |
|                |   |   |      |   |            |   |
| 0-6      months     |   | $      | 7,586,433 |   |            | $      | 16,604 |   |
| 7-12      months    |   |   | -         |   |            |   | - |   |
| Over      12 months |   |   | -         |   |            |   | - |   |
|   Total   |   | $      | 7,586,433 |   |            | $      | 16,604 |   |

----

|                                                                                       |   | Three Months Ended September    30 |      |   | Nine Months Ended September    30 |   |
|--------------------------------------------------------------------------------------------|--------|------------------------------------|-----------|--------|-----------------------------------|--------|
|                                                                                       |   |                               |      |   |                              |   |   | Increase |   |   |   |   |   |   |   |   | Increase |   |
|                                                                                       |   | 2008                               |      |   | 2007                              |   |   | (Decrease) |   |   | 2008 |   |   | 2007 |   |   | (Decrease) |   |
| Policy      fee income                                                                     |   | $                                  | 554,774   |   |                              | $      | 608,242 |   |   | $ | (53,468 | ) |   | $ | 1,697,793 |   |   | $ | 1,890,974 |   |   | $ | (193,181 | ) |
| Health      insurance program                                                              |   |                               | 690,870   |   |                              |   | 607,921 |   |   |   | 82,949 |   |   |   | 2,049,747 |   |   |   | 1,656,781 |   |   |   | 392,966 |   |
| Membership      and fee income                                                             |   |                               | 74,499    |   |                              |   | 78,386 |   |   |   | (3,887 | ) |   |   | 227,548 |   |   |   | 232,462 |   |   |   | (4,914 | ) |
| Other      commission and fee income                                                       |   |                               | 50        |   |                              |   | (1,338 | ) |   |   | 1,388 |   |   |   | 7,212 |   |   |   | 11,608 |   |   |   | (4,396 | ) |
| Daily      automobile rental insurance program:                                       |   |                               |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Commission      income (excluding contingent      commission) |   |                               | 92,718    |   |                              |   | 87,992 |   |   |   | 4,726 |   |   |   | 258,775 |   |   |   | 257,736 |   |   |   | 1,039 |   |
|     Contingent      commission                                         |   |                               | -         |   |                              |   | - |   |   |   | - |   |   |   |  58,593 |   |   |   |  46,539 |   |   |   | 12,054 |   |
| Total                                                                                      |   | $                                  | 1,412,911 |   |                              | $      | 1,381,203 |   |   | $ | 31,708 |   |   | $ | 4,299,668 |   |   | $ | 4,096,100 |   |   | $ | 203,568 |   |

----

|                                                        |   | Three Months Ended September    30 |      |   | Nine Months Ended September    30 |   |
|-------------------------------------------------------------|--------|------------------------------------|-----------|--------|-----------------------------------|--------|
|                                                        |   |                               |      |   |                              |   |   | Increase |   |   |   |   |   |   |   |   | Increase |   |
|                                                        |   | 2008                               |      |   | 2007                              |   |   | (Decrease) |   |   | 2008 |   |   | 2007 |   |   | (Decrease) |   |
| Losses      and loss adjustment expenses               |   |                               |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current      accident year                                  |   | $                                  | 5,798,936 |   |                              | $      | 6,796,662 |   |   | $ | (997,726 | ) |   | $ | 18,731,978 |   |   | $ | 20,188,504 |   |   | $ | (1,456,526 | ) |
| Favorable      development of      all prior accident years |   |                               | 1,048,671 |   |                              |   | 1,111,409 |   |   |   |   62,738 |   |   |   |  1,705,418 |   |   |   |  3,085,175 |   |   |   |  1,379,757 |   |
| Total                                                       |   | $                                  | 4,750,265 |   |                              | $      | 5,685,253 |   |   | $ | (934,988 | ) |   | $ | 17,026,560 |   |   | $ | 17,103,329 |   |   | $ | (76,769 | ) |

----

Certain statements contained herein, including the sectionentitled “Management’s Discussion and Analysis of Financial Condition andResults of Operations,” that are not historical facts areforward-looking.  These statements, which may be identified byforward-looking words or phrases such as “anticipate,” “believe,” ”expect,”“intend,” “may,” “should,” and “would,” involve risks and uncertainties, many ofwhich are beyond the control of the Company.  Such risks anduncertainties could cause actual results to differ materially from theseforward-looking statements.  Factors which could cause actual resultsto differ materially include underwriting actions not being effective, rateincreases for coverages not being sufficient, premium rate adequacy relating tocompetition or regulation, actual versus estimated claim experience, regulatorychanges or developments, unforeseen calamities, general market conditions, andthe Company’s ability to introduce new profitable products.

|                                                     |   | September      30 2008 |        |   | December      312007 |   |        | Increase (Decrease) |   |
|----------------------------------------------------------|--------|-----------------------------|-------------|--------|----------------------|--------|-------------|--------------------------|--------|
|                                                     |   |                        |        |   |                 |   |        |                     |   |
| Fixed      maturity bonds (at amortized value)           |   | $                           | 140,449,488 |   |                 | $      | 139,592,208 |                     |   | $ | 857,280 |   |
| Short-term      cash investments (at cost)               |   |                        | 5,097,351   |   |                 |   | 7,356,159   |                     |   |   | (2,258,808 | ) |
| Certificates      of deposit (over 1 year, at cost)      |   |                        | 400,000     |   |                 |   | 400,000     |                     |   |   | - |   |
|      Total      invested assets |   | $                           | 145,946,839 |   |                 | $      | 147,348,367 |                     |   | $ | (1,401,528 | ) |

----

|     Period                              |   |   TotalNumber      ofSharesPurchased |   |   |    AveragePrice      PaidPer Share |   |   | Total      Numberof      SharesPurchased      as PartOf      PubliclyAnnounced      Plansor Programs(1) |   |   | MaximumNumberof      Sharesthat      May Yet BePurchased      Under thePlans or Programs(1) |   |
|-------------------------------------------------------------|--------|------------------------------------------------|--------|--------|---------------------------------------------------|--------|--------|---------------------------------------------------------------------------------------------------------|--------|--------|---------------------------------------------------------------------------------------------|--------|
| July      1, 2008 through July 30, 2008                     |   |                                           | -      |   |                                              |   | -      |                                                                                                    |   |   | -                                                                                           |   |   |   | 66,559 |   |
| August      1, 2008 through August      31, 2008       |   |                                           | 837    |   |                                              | $      | 8.38   |                                                                                                    |   |   | 837                                                                                         |   |   |   | 65,722 |   |
| September      1, 2008 through September      30, 2008 |   |                                           | 10,762 |   |                                              | $      | 8.50   |                                                                                                    |   |   | 10,762                                                                                      |   |   |   | 54,960 |   |
| Total                                                       |   |                                           | 11,599 |   |                                              | $      | 8.49   |                                                                                                    |   |   | 11,599                                                                                      |   |   |   | 54,960 |   |

|   | (1)   In      April 2000, the Company announced that its Board of Directors had      authorized the purchase in the open market from time to time of up to an      aggregate of 315,000 shares of the common stock of the      Company.  On August 8, 2000, the Board of Directors authorized      the purchase of an additional 315,000 shares and on September 6, 2000, the      Board of Directors authorized the purchase of another 315,000 shares of      the common stock of the Company in the open market from time to      time.  Thus, the Board of Directors authorized the purchase in      the open market of up to an aggregate of 945,000 shares of the common      stock of the Company.  The program has no expiration date and      may be terminated by the Board of Directors at any time.  As of      September 30, 2008, an aggregate of 890,040 shares of common stock had      been purchased by the Company pursuant to this authorization. The Company      has or will retire all stockpurchased. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.1 | Certificate      of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a),      as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of      2002. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.2 | Certificate      of Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a),      as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of      2002. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.1 | Certification      of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted      pursuant to Section 906 of the Sarbanes-Oxley Act of  2002. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.2 | Certification      of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted      pursuant to Section 906 of the Sarbanes-Oxley Act of  2002. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Pursuant      to the requirements of the Securities Exchange Act of 1934, the Registrant      has duly caused this report to be signed on its behalf by the undersigned      thereunto duly authorized. |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 31.1 |             Certificate of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule      15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of      2002 (filed herewith) |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.2 |             Certificate of Chief Financial Officer pursuant to Rule 13a-14(a) or Rule      15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of      2002 (filed herewith) |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.1 |             Certification of Chief Executive Officer pursuant to 18 U.S.C. Section      1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002      (filed herewith) |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.2 |             Certification of Chief Financial Officer pursuant to 18 U.S.C. Section      1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002      (filed herewith) |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|