UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-Q





(Mark One)

|x | Quarterly report pursuant to section 13 or 15 (d) of the Securities Exchange Act of 1934
|- | ----------------------------------------------------------------------------------------

For the Quarterly Period ended March 31, 2011.



| ̈ | Transition report pursuant to section 13 or 15 (d) of the Securities Exchange Act of 1934.
|- | ------------------------------------------------------------------------------------------

For the transition period from              to
             .

Commission file number 000-28249





AMERINST INSURANCE GROUP, LTD.

(Exact Name of Registrant as Specified in its Charter)







|                                                                                                        |  |                                     
|------------------------------------------------------------------------------------------------------- |  | ------------------------------------
|BERMUDA                                                                                                 |  | 98-0207447                          
|(State or other jurisdiction of
Incorporation or Organization)                                          |  | (I.R.S. Employer Identification No.)
|                                                                                                        | 
|c/o Cedar Management Limited 25 Church Street, Continental Building P.O. Box HM 1601, Hamilton,
Bermuda |  | HMGX                                
|(Address of Principal Executive Offices)                                                                |  | (Zip Code)                          

(441) 295-6015

(Telephone number)





Indicate by
check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No   ̈

Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).    Yes   ̈    No   ̈

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of accelerated filer, large accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.



|                        |  |                                                 |  |                           |  |  
|----------------------- |  | ----------------------------------------------- |  | ------------------------- |  | -
|Large accelerated filer |  |  ̈                                               |  | Accelerated filer         |  |  ̈
|                        |  |                                                 | 
|Non-accelerated filer   |  |  ̈ (Do not check if a smaller reporting company) |  | Smaller reporting company |  | x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act).    YES   ̈    NO  x.

As of May 1, 2011, the Registrant had 995,253 common shares, $1.00 par value per share, outstanding.









---

Introductory Note

Caution Concerning Forward-Looking Statements

Certain statements contained in this Form 10-Q, or otherwise made by our officers, including statements related to our future performance, our outlook for our businesses and respective markets,
projections, statements of our managements plans or objectives, forecasts of market trends and other matters, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and contain
information relating to us that is based on the beliefs of our management as well as assumptions made by, and information currently available to, our management. The words expect, believe, may and similar
expressions as they relate to us or our management are intended to identify forward-looking statements. Such statements reflect our managements current views with respect to future events and are subject to certain risks, uncertainties and
assumptions that could cause actual results to differ materially from those reflected in any forward-looking statements. Our actual future results may differ materially from those set forth in our forward-looking statements. Factors that might cause
such actual results to differ materially from those reflected in any forward-looking statements include, but are not limited to the factors discussed in detail in Item 2, Managements Discussion and Analysis of Financial Condition
and Results of Operations in this form 10-Q, as well as:



| |  |  | the occurrence of catastrophic events with a frequency or severity exceeding our expectations;
| | - |  | ----------------------------------------------------------------------------------------------



| |  |  | a decrease in the level of demand for reinsurance or an increase in the supply of reinsurance capacity;
| | - |  | -------------------------------------------------------------------------------------------------------



| |  |  | the successful implementation of our business plan without a significant depletion of our cash resources, the maintenance of sufficient capital levels
and the retention of our current A.M. Best rating;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | a worsening of the current global economic market conditions and global credit crisis and changing rates of inflation and other economic conditions;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | increased competitive pressures, including the consolidation and increased globalization of reinsurance providers;
| | - |  | ------------------------------------------------------------------------------------------------------------------



| |  |  | actual losses and loss expenses exceeding our loss reserves, which are necessarily based on the actuarial and statistical projections of ultimate
losses;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | increased rate pressure on premiums;
| | - |  | ------------------------------------



| |  |  | adequacy of our risk management and loss limitations methods;
| | - |  | -------------------------------------------------------------



| |  |  | the integration of businesses we may acquire or new business ventures we may start;
| | - |  | -----------------------------------------------------------------------------------



| |  |  | acts of terrorism, political unrest, outbreak of war and other hostilities or other non-forecasted and unpredictable events;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------



| |  |  | changes in the legal or regulatory environments in which we operate; and
| | - |  | ------------------------------------------------------------------------



| |  |  | other risks, including those risks identified in any of our other filings with the Securities and Exchange Commission.
| | - |  | ----------------------------------------------------------------------------------------------------------------------

The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with other cautionary
statements that are included herein. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect our managements analysis only as of the date they are made. We undertake no obligation to release
publicly the results of any future revisions we may make to forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.



2



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Part IFINANCIAL INFORMATION



|Item  1. | Financial Statements.
|-------- | ---------------------

AMERINST INSURANCE GROUP, LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited, expressed in U.S.
dollars)



|                                                                                                           |  |                    |            |   |                       |   |            |  
|---------------------------------------------------------------------------------------------------------- |  | ------------------ | ---------- | - | --------------------- | - | ---------- | -
|                                                                                                           |  | As ofMarch 31,2011 |            |   | As ofDecember 31,2010 |  
|ASSETS                                                                                                     |  |                    |            |   |                       |   |            |  
|INVESTMENTS                                                                                                |  |                    |            |   |                       |   |            |  
|Fixed maturity investments, available for sale, at fair value (amortized cost $10,226,684 and $10,739,265) |  | $                  | 10,459,430 |   |                       | $ | 10,929,481 |  
|Equity securities, available for sale, at fair value (cost $8,913,137 and $9,342,671)                      |  |                    | 15,014,396 |   |                       |   | 15,630,008 |  
|                                                                                                           |  |                    |            |   |                       |   |            |  
|TOTAL INVESTMENTS                                                                                          |  |                    | 25,473,826 |   |                       |   | 26,559,489 |  
|Cash and cash equivalents                                                                                  |  |                    | 1,048,576  |   |                       |   | 970,697    |  
|Restricted cash and cash equivalents                                                                       |  |                    | 168,341    |   |                       |   | 84,256     |  
|Assumed reinsurance balances receivable                                                                    |  |                    | 87,535     |   |                       |   | 45,909     |  
|Accrued investment income                                                                                  |  |                    | 119,324    |   |                       |   | 117,226    |  
|Property and equipment                                                                                     |  |                    | 730,015    |   |                       |   | 716,230    |  
|Deferred policy acquisition costs                                                                          |  |                    | 69,638     |   |                       |   | 35,060     |  
|Prepaid expenses and other assets                                                                          |  |                    | 176,862    |   |                       |   | 170,606    |  
|                                                                                                           |  |                    |            |   |                       |   |            |  
|TOTAL ASSETS                                                                                               |  | $                  | 27,874,117 |   |                       | $ | 28,699,473 |  
|                                                                                                           |  |                    |            |   |                       |   |            |  
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                       |  |                    |            |   |                       |   |            |  
|LIABILITIES                                                                                                |  |                    |            |   |                       |   |            |  
|Unpaid losses and loss adjustment expenses                                                                 |  | $                  | 1,225,929  |   |                       | $ | 1,203,016  |  
|Unearned premium                                                                                           |  |                    | 188,212    |   |                       |   | 94,756     |  
|Assumed reinsurance balances payable                                                                       |  |                    | 10,075     |   |                       |   | 76,918     |  
|Accrued expenses and other liabilities                                                                     |  |                    | 902,691    |   |                       |   | 1,126,409  |  
|                                                                                                           |  |                    |            |   |                       |   |            |  
|TOTAL LIABILITIES                                                                                          |  | $                  | 2,326,907  |   |                       | $ | 2,501,099  |  
|                                                                                                           |  |                    |            |   |                       |   |            |  
|SHAREHOLDERS EQUITY                                                                                       |  |                    |            |   |                       |   |            |  
|Common shares, $1 par value, 2011 and 2010: 2,000,000 shares authorized, 995,253 issued and outstanding    |  | $                  | 995,253    |   |                       | $ | 995,253    |  
|Additional paid-in capital                                                                                 |  |                    | 6,287,293  |   |                       |   | 6,287,293  |  
|Retained earnings                                                                                          |  |                    | 18,589,070 |   |                       |   | 19,096,686 |  
|Accumulated other comprehensive income                                                                     |  |                    | 6,334,005  |   |                       |   | 6,477,553  |  
|Shares held by Subsidiary (295,881 and 295,881 shares) at cost                                             |  |                    | (6,658,411 | ) |                       |   | (6,658,411 | )
|                                                                                                           |  |                    |            |   |                       |   |            |  
|TOTAL SHAREHOLDERS EQUITY                                                                                 |  |                    | 25,547,210 |   |                       |   | 26,198,374 |  
|                                                                                                           |  |                    |            |   |                       |   |            |  
|TOTAL LIABILITIES AND SHAREHOLDERS EQUITY                                                                 |  | $                  | 27,874,117 |   |                       | $ | 28,699,473 |  
|                                                                                                           |  |                    |            |   |                       |   |            |  

See the accompanying notes to the unaudited condensed consolidated financial statements.



3



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AMERINST INSURANCE GROUP, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF

OPERATIONS, COMPREHENSIVE (LOSS) INCOME

AND RETAINED EARNINGS

(Unaudited, expressed in U.S. dollars)



|                                                                    |  |                                |            |   |                                 |   |            |  
|------------------------------------------------------------------- |  | ------------------------------ | ---------- | - | ------------------------------- | - | ---------- | -
|                                                                    |  | Three
MonthsEndedMarch 31,2011 |            |   | Three MonthsEndedMarch 
31,2010 |  
|REVENUE                                                             |  |                                |            |   |                                 |   |            |  
|Net premiums earned                                                 |  | $                              | 45,490     |   |                                 | $ | 96,410     |  
|Commission income                                                   |  |                                | 72,609     |   |                                 |   | 1,257      |  
|Net investment income                                               |  |                                | 95,344     |   |                                 |   | 77,172     |  
|Net realized gain on investments                                    |  |                                | 816,768    |   |                                 |   | 312,368    |  
|                                                                    |  |                                |            |   |                                 |   |            |  
|TOTAL REVENUE                                                       |  |                                | 1,030,211  |   |                                 |   | 487,207    |  
|LOSSES AND EXPENSES                                                 |  |                                |            |   |                                 |   |            |  
|Losses and loss adjustment expenses                                 |  |                                | 28,452     |   |                                 |   |           |  
|Policy acquisition costs (recoveries)                               |  |                                | 16,831     |   |                                 |   | (29,175    | )
|Operating and management expenses                                   |  |                                | 1,163,853  |   |                                 |   | 951,211    |  
|                                                                    |  |                                |            |   |                                 |   |            |  
|TOTAL LOSSES AND EXPENSES                                           |  |                                | 1,209,136  |   |                                 |   | 922,036    |  
|                                                                    |  |                                |            |   |                                 |   |            |  
|NET LOSS BEFORE TAX                                                 |  | $                              | (178,925   | ) |                                 | $ | (434,829   | )
|                                                                    |  |                                |            |   |                                 |   |            |  
|Income tax expense                                                  |  |                                |           |   |                                 |   |           |  
|NET LOSS AFTER TAX                                                  |  | $                              | (178,925   | ) |                                 | $ | (434,829   | )
|OTHER COMPREHENSIVE (LOSS) INCOME                                   |  |                                |            |   |                                 |   |            |  
|Net unrealized holding gain arising during the period               |  |                                | 673,220    |   |                                 |   | 1,316,167  |  
|Reclassification adjustment for (gain) included in net (loss)       |  |                                | (816,768   | ) |                                 |   | (312,368   | )
|                                                                    |  |                                |            |   |                                 |   |            |  
|OTHER COMPREHENSIVE (LOSS) INCOME                                   |  |                                | (143,548   | ) |                                 |   | 1,003,799  |  
|                                                                    |  |                                |            |   |                                 |   |            |  
|COMPREHENSIVE (LOSS) INCOME                                         |  | $                              | (322,473   | ) |                                 | $ | 568,970    |  
|                                                                    |  |                                |            |   |                                 |   |            |  
|RETAINED EARNINGS, BEGINNING OF PERIOD                              |  | $                              | 19,096,686 |   |                                 | $ | 20,846,392 |  
|Net loss                                                            |  |                                | (178,925   | ) |                                 |   | (434,829   | )
|Dividends                                                           |  |                                | (328,691   | ) |                                 |   | (346,401   | )
|                                                                    |  |                                |            |   |                                 |   |            |  
|RETAINED EARNINGS, END OF PERIOD                                    |  |                                | 18,589,070 |   |                                 |   | 20,065,162 |  
|                                                                    |  |                                |            |   |                                 |   |            |  
|Per share amounts                                                   |  |                                |            |   |                                 |   |            |  
|Basic and diluted loss per share                                    |  | $                              | (0.25      | ) |                                 | $ | (0.59      | )
|                                                                    |  |                                |            |   |                                 |   |            |  
|Dividends                                                           |  | $                              | 0.47       |   |                                 | $ | 0.47       |  
|                                                                    |  |                                |            |   |                                 |   |            |  
|Weighted average number of shares outstanding for the entire period |  |                                | 714,278    |   |                                 |   | 737,228    |  
|                                                                    |  |                                |            |   |                                 |   |            |  

See the accompanying notes to the unaudited condensed consolidated financial statements.



4



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AMERINST INSURANCE GROUP, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, expressed in U.S. dollars)



|                                                       |  |                                 |            |   |                                 |   |            |  
|------------------------------------------------------ |  | ------------------------------- | ---------- | - | ------------------------------- | - | ---------- | -
|                                                       |  | Three MonthsEndedMarch 31, 2011 |            |   | Three MonthsEndedMarch 31, 2010 |  
|OPERATING ACTIVITIES                                   |  |                                 |            |   |                                 |   |            |  
|Net Cash used in Operating Activities                  |  | $                               | (1,241,861 | ) |                                 | $ | (915,736   | )
|                                                       |  |                                 |            |   |                                 |   |            |  
|INVESTING ACTIVITIES                                   |  |                                 |            |   |                                 |   |            |  
|Movement in restricted cash and cash equivalents       |  |                                 | (84,085    | ) |                                 |   | 617,142    |  
|Purchases of property and equipment                    |  |                                 | (13,785    | ) |                                 |   | (138,905   | )
|Purchases of available-for-sale securities             |  |                                 | (427,678   | ) |                                 |   | (1,080,612 | )
|Proceeds from sales of available-for-sale securities   |  |                                 | 1,673,979  |   |                                 |   | 585,181    |  
|Proceeds from maturities of fixed maturity investments |  |                                 | 500,000    |   |                                 |   |           |  
|                                                       |  |                                 |            |   |                                 |   |            |  
|Net Cash provided by (used in) Investing Activities    |  |                                 | 1,648,431  |   |                                 |   | (17,194    | )
|                                                       |  |                                 |            |   |                                 |   |            |  
|FINANCING ACTIVITIES                                   |  |                                 |            |   |                                 |   |            |  
|Purchase of shares by subsidiary                       |  |                                 |           |   |                                 |   | (11,447    | )
|Dividends paid                                         |  |                                 | (328,691   | ) |                                 |   | (346,401   | )
|                                                       |  |                                 |            |   |                                 |   |            |  
|Net Cash used in Financing Activities                  |  |                                 | (328,691   | ) |                                 |   | (357,848   | )
|                                                       |  |                                 |            |   |                                 |   |            |  
|NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS   |  |                                 | 77,879     |   |                                 |   | (1,290,778 | )
|CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD         |  | $                               | 970,697    |   |                                 | $ | 3,472,529  |  
|                                                       |  |                                 |            |   |                                 |   |            |  
|CASH AND CASH EQUIVALENTS, END OF PERIOD               |  | $                               | 1,048,576  |   |                                 | $ | 2,181,751  |  
|                                                       |  |                                 |            |   |                                 |   |            |  

See the accompanying notes to the unaudited condensed consolidated financial statements.



5



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AMERINST INSURANCE GROUP, LTD.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2011



|1. | BASIS OF PREPARATION AND CONSOLIDATION
|-- | --------------------------------------

The condensed consolidated financial statements included herein have been prepared by AmerInst Insurance Group, Ltd. (AmerInst) without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission (SEC or the Commission), and reflect all adjustments consisting of normal recurring accruals, which are, in the opinion of management, necessary for a fair presentation of our financial
position and results of operations as of the end of and for the periods presented. All intercompany transactions and balances have been eliminated on consolidation. These statements are condensed and do not incorporate all the information required
under generally accepted accounting principles to be included in a full set of financial statements. In these notes, the terms we, us, our or the Company refer to AmerInst and its subsidiaries. It is
suggested that these condensed statements be read in conjunction with the audited consolidated financial statements at and for the year ended December 31, 2010 and notes thereto, included in AmerInsts Annual Report on Form 10-K for the
year then ended.

Critical Accounting Policies

The Companys critical accounting policies are discussed in Managements Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for
the year ended December 31, 2010.

New Accounting Pronouncements  Accounting Standards Adopted

The Company has determined that all recently issued accounting pronouncements do not have a material impact on its consolidated financial
statements, or do not apply to its operations.



|2. | INVESTMENTS
|-- | -----------

The cost or
amortized cost, gross unrealized holding gains and losses, and estimated fair value of the Companys fixed maturity investments, by major security type, and equity securities as of March 31, 2011 and December 31, 2010 are as follows:



|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|------------------------------------------------ |  | -------------------- | ---------- |  | -------------------- | - | --------- | --------------------- |  | - | ------------------- | - |  | - | ---------- | 
|                                                 |  | Cost orAmortizedCost |            |  | GrossUnrealizedGains |   |           | GrossUnrealizedLosses |  |   | EstimatedFair Value |  
|As of March 31, 2011                             |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Fixed maturity investments:                      |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|U.S. government agency securities                |  | $                    | 1,925,967  |  |                      | $ | 22,450    |                       |  | $ |                    |   |  | $ | 1,948,417  | 
|Obligations of states and political subdivisions |  |                      | 8,300,717  |  |                      |   | 280,348   |                       |  |   | (70,052             | ) |  |   | 8,511,013  | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Total fixed maturity investments                 |  |                      | 10,226,684 |  |                      |   | 302,798   |                       |  |   | (70,052             | ) |  |   | 10,459,430 | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Equity securities*                               |  |                      | 7,913,137  |  |                      |   | 5,598,156 |                       |  |   |                    |   |  |   | 13,511,293 | 
|Hedge fund                                       |  |                      | 1,000,000  |  |                      |   | 503,103   |                       |  |   |                    |   |  |   | 1,503,103  | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Total equity securities                          |  |                      | 8,913,137  |  |                      |   | 6,101,259 |                       |  |   |                    |   |  |   | 15,014,396 | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Total investments                                |  | $                    | 19,139,821 |  |                      | $ | 6,404,057 |                       |  | $ | (70,052             | ) |  | $ | 25,473,826 | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 



6



---

|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|------------------------------------------------ |  | -------------------- | ---------- |  | -------------------- | - | --------- | --------------------- |  | - | ------------------- | - |  | - | ---------- | 
|                                                 |  | Cost orAmortizedCost |            |  | GrossUnrealizedGains |   |           | GrossUnrealizedLosses |  |   | EstimatedFair Value |  
|As of December 31, 2010                          |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Fixed maturity investments:                      |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|U.S. government agency securities                |  | $                    | 1,931,335  |  |                      | $ | 28,253    |                       |  | $ |                    |   |  | $ | 1,959,588  | 
|Obligations of states and political subdivisions |  |                      | 8,307,102  |  |                      |   | 243,041   |                       |  |   | (84,406             | ) |  |   | 8,465,737  | 
|Corporate debt securities                        |  |                      | 500,828    |  |                      |   | 3,328     |                       |  |   |                    |   |  |   | 504,156    | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Total fixed maturity investments                 |  |                      | 10,739,265 |  |                      |   | 274,622   |                       |  |   | (84,406             | ) |  |   | 10,929,481 | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Equity securities*                               |  |                      | 8,342,671  |  |                      |   | 5,802,453 |                       |  |   |                    |   |  |   | 14,145,124 | 
|Hedge fund                                       |  |                      | 1,000,000  |  |                      |   | 484,884   |                       |  |   |                    |   |  |   | 1,484,884  | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Total equity securities                          |  |                      | 9,342,671  |  |                      |   | 6,287,337 |                       |  |   |                    |   |  |   | 15,630,008 | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 
|Total investments                                |  | $                    | 20,081,936 |  |                      | $ | 6,561,959 |                       |  | $ | (84,406             | ) |  | $ | 26,559,489 | 
|                                                 |  |                      |            |  |                      |   |           |                       |  |   |                     |   |  |   |            | 



| | * | The Companys equity securities are managed by an external large cap value advisor. Our investment approach is to focus on increasing the fair market value of our
equity securities by investing in companies that may or may not be paying a dividend but whose market values may increase over time. Some of the key factors we consider in a prospective company to invest in include the discount to value and the
quality of the management team.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The following tables summarize the Companys fixed maturity and equity
securities in an unrealized loss position and the aggregate fair value and gross unrealized loss by length of time the security has continuously been in an unrealized loss position:



|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|------------------------------------------------ |  | -------------------- | ------- |  | ------------------- | - | ------ | ------------------- |  | - | ---------------- |  |  | ------------------- | ------- | - | ---------------- | - | --------- |  |  | - | ------- | -
|                                                 |  | 12 months or greater |         |  | Less than 12 months |   |        | Total               | 
|                                                 |  | EstimatedFair Value  |         |  | UnrealizedLosses    |   |        | EstimatedFair Value |  |   | UnrealizedLosses |  |  | EstimatedFair Value |         |   | UnrealizedLosses |  
|As of March 31, 2011                             |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Fixed maturity investments:                      |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|U.S. government agency securities                |  | $                    |        |  |                     | $ |       |                     |  | $ |                 |  |  | $                   |        |   |                  | $ |          |  |  | $ |        |  
|Obligations of states and political subdivisions |  |                      | 497,993 |  |                     |   | (2,254 | )                   |  |   | 1,585,267        |  |  |                     | (67,798 | ) |                  |   | 2,083,260 |  |  |   | (70,052 | )
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Total fixed maturity investments                 |  |                      | 497,993 |  |                     |   | (2,254 | )                   |  |   | 1,585,267        |  |  |                     | (67,798 | ) |                  |   | 2,083,260 |  |  |   | (70,052 | )
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Equity securities                                |  |                      |        |  |                     |   |       |                     |  |   |                 |  |  |                     |        |   |                  |   |          |  |  |   |        |  
|Hedge fund                                       |  |                      |        |  |                     |   |       |                     |  |   |                 |  |  |                     |        |   |                  |   |          |  |  |   |        |  
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Total equity securities                          |  |                      |        |  |                     |   |       |                     |  |   |                 |  |  |                     |        |   |                  |   |          |  |  |   |        |  
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Total investments                                |  | $                    | 497,993 |  |                     | $ | (2,254 | )                   |  | $ | 1,585,267        |  |  | $                   | (67,798 | ) |                  | $ | 2,083,260 |  |  | $ | (70,052 | )
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  



|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|------------------------------------------------ |  | -------------------- | ------- |  | ------------------- | - | ------ | ------------------- |  | - | ---------------- |  |  | ------------------- | ------- | - | ---------------- | - | --------- |  |  | - | ------- | -
|                                                 |  | 12 months or greater |         |  | Less than 12 months |   |        | Total               | 
|                                                 |  | EstimatedFair Value  |         |  | UnrealizedLosses    |   |        | EstimatedFair Value |  |   | UnrealizedLosses |  |  | EstimatedFair Value |         |   | UnrealizedLosses |  
|As of December 31, 2010                          |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Fixed maturity investments:                      |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|U.S. government agency securities                |  | $                    |        |  |                     | $ |       |                     |  | $ |                 |  |  | $                   |        |   |                  | $ |          |  |  | $ |        |  
|Obligations of states and political subdivisions |  |                      | 497,924 |  |                     |   | (2,445 | )                   |  |   | 1,573,160        |  |  |                     | (81,961 | ) |                  |   | 2,071,084 |  |  |   | (84,406 | )
|Corporate debt securities                        |  |                      |        |  |                     |   |       |                     |  |   |                 |  |  |                     |        |   |                  |   |          |  |  |   |        |  
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Total fixed maturity investments                 |  |                      | 497,924 |  |                     |   | (2,445 | )                   |  |   | 1,573,160        |  |  |                     | (81,961 | ) |                  |   | 2,071,084 |  |  |   | (84,406 | )
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Equity securities                                |  |                      |        |  |                     |   |       |                     |  |   |                 |  |  |                     |        |   |                  |   |          |  |  |   |        |  
|Hedge fund                                       |  |                      |        |  |                     |   |       |                     |  |   |                 |  |  |                     |        |   |                  |   |          |  |  |   |        |  
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Total equity securities                          |  |                      |        |  |                     |   |       |                     |  |   |                 |  |  |                     |        |   |                  |   |          |  |  |   |        |  
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  
|Total investments                                |  | $                    | 497,924 |  |                     | $ | (2,445 | )                   |  | $ | 1,573,160        |  |  | $                   | (81,961 | ) |                  | $ | 2,071,084 |  |  | $ | (84,406 | )
|                                                 |  |                      |         |  |                     |   |        |                     |  |   |                  |  |  |                     |         |   |                  |   |           |  |  |   |         |  

As of March 31, 2011 and December 31, 2010, the number of available for sale fixed maturity
securities in an unrealized loss position was six with an estimated fair value of $2,083,260 and $2,071,084 respectively. As of March 31, 2011 and December 31, 2010, one of these securities had been in an unrealized loss position for 12
months or greater. As of March 31, 2011, none of these



7



---

securities were considered to be other than temporarily impaired. The Company has no intent to sell and it is not more likely than not that the Company will be required to sell these securities
before their fair values recover above the adjusted cost. The unrealized losses from these securities were not as a result of credit, collateral or structural issues.

Other-Than-Temporary Impairment Process

The Company assesses
whether declines in the fair value of its fixed maturity investments classified as available-for-sale represent impairments that are other-than-temporary by reviewing each fixed maturity investment that is impaired and: (1) determining if
the Company has the intent to sell the fixed maturity investment or if it is more likely than not that the Company will be required to sell the fixed maturity investment before its anticipated recovery; and (2) assessing whether a credit loss
exists, that is, where the Company expects that the present value of the cash flows expected to be collected from the fixed maturity investment are less than the amortized cost basis of the investment.

The Company had no planned sales of its fixed maturity investments classified as available-for-sale that were in an unrealized loss
position at March 31, 2011. In assessing whether it is more likely than not that the Company will be required to sell a fixed maturity investment before its anticipated recovery, the Company considers various factors including its future cash
flow requirements, legal and regulatory requirements, the level of its cash, cash equivalents, short term investments and fixed maturity investments available for sale in an unrealized gain position, and other relevant factors. For the three months
ended March 31, 2011, the Company did not recognize any other-than-temporary impairments due to required sales.

In
evaluating credit losses, the Company considers a variety of factors in the assessment of a fixed maturity investment including: (1) the time period during which there has been a significant decline below cost; (2) the extent of the
decline below cost and par; (3) the potential for the fixed maturity investment to recover in value; (4) an analysis of the financial condition of the issuer; (5) the rating of the issuer; and (6) failure of the issuer of the
fixed maturity investment to make scheduled interest or principal payments.

If we conclude a security is
other-than-temporarily impaired, we write down the amortized cost of the security to fair value, with a charge to net realized investment gains (losses) in the Consolidated Statement of Operations. Gross unrealized losses on the investment portfolio
as of March 31, 2011 and December 31, 2010, relating to six fixed maturity securities, amounted to $70,052 and $84,406, respectively. This decrease was attributable to the increase in the fair value of fixed maturity securities as a result
of improved market conditions. The unrealized losses on these available for sale fixed maturity securities were not as a result of credit, collateral or structural issues. No other-than-temporary impairment charges were recorded during the quarters
ended March 31, 2011 and 2010.

Fair Value of Investments

Under existing accounting principles generally accepted in the United States, we are required to recognize certain assets at their fair
value in our consolidated balance sheets. This includes our fixed maturity investments and equity securities. In accordance with the Fair Value Measurements and Disclosures Topic of Financial Accounting Standards Boards (FASB)
Accounting Standards Codification (ASC) 820, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC
820 establishes a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon whether the inputs to the valuation of an asset or liability are observable or unobservable in the market at the
measurement date, with quoted market prices being the highest level (Level 1) and unobservable inputs being the lowest level (Level 3). A fair value measurement will fall within the level of the hierarchy based on the input that is significant to
determining such measurement. The three levels are defined as follows:



| |  |  | Level 1: Observable inputs to the valuation methodology that are quoted prices (unadjusted) for identical assets or liabilities in active
markets.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Level 2: Observable inputs to the valuation methodology other than quoted market prices (unadjusted) for identical assets or liabilities in
active markets. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical assets in markets that are not active and inputs other than quoted prices that are observable for the asset or
liability, either directly or indirectly, for substantially the full term of the asset or liability.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Level 3: Inputs to the valuation methodology that are unobservable for the asset or liability.
| | - |  | ----------------------------------------------------------------------------------------------

At each measurement date, we estimate the fair value of the security using various valuation techniques. We utilize, to the extent
available, quoted market prices in active markets or observable market inputs in estimating the fair value of our investments. When quoted market prices or observable market inputs are not available, we utilize valuation techniques that rely on
unobservable inputs to estimate the fair value of investments. The following describes the valuation techniques we used to determine the fair value of investments held as of March 31, 2011 and what level within the fair value hierarchy each
valuation technique resides.



| |  |  | U.S. government agency securities: Comprised primarily of bonds issued by the Federal Home Loan Bank, the Federal Home Loan Mortgage
Corporation, Federal Farm Credit Bank and the Federal National Mortgage Association. The fair values of U.S. government agency securities are priced using the spread above the risk-free U.S. Treasury yield curve. As
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



8



---

| | the yields for the risk-free U.S. Treasury yield curve are observable market inputs, the fair values of U.S. government agency securities are included in the Level 2 fair value hierarchy.
AmerInst considers that there is a liquid market for the types of securities held. Broker quotes are not used for fair value pricing.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Obligations of state and political subdivisions: Comprised of fixed income obligations of state and local governmental municipalities. The fair
values of these securities are based on quotes and current market spread relationships, and are included in the Level 2 fair value hierarchy. AmerInst considers that there is a liquid market for the types of securities held. Broker quotes are not
used for fair value pricing.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Corporate debt securities: Comprised of bonds issued by corporations. The fair values of these securities are based on quotes and current market
spread relationships, and are included in the Level 2 fair value hierarchy. AmerInst considers that there is a liquid market for the types of securities held. Broker quotes are not used for fair value pricing.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Equity securities, at fair value: Comprised primarily of investments in the common stock of publicly traded companies in the U.S. All of the
Companys equities are included in the Level 1 fair value hierarchy. The Company receives prices based on closing exchange prices from independent pricing sources to measure fair values for the equities.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Hedge fund: Comprised of a hedge fund whose objective is to seek attractive long-term returns with lower volatility by investing in a range of
diversified investment strategies. The fund invests in a diversified pool of hedge fund managers, generally across six different strategies: long/short equities, long/short credit, macro, multi-strategy opportunistic, activist, and portfolio hedge.
The fair value of the hedge fund is based on the net asset value of the fund as reported by the fund manager. The fair value of our hedge fund is included in the Level 3 fair value hierarchy.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

To validate prices, we complete quantitative analyses to compare the performance of the above investments to the performance of
appropriate benchmarks, with significant differences identified and investigated.

There have been no material changes to any
of our valuation techniques from what was used as of December 31, 2010. Since the fair value of a security is an estimate of what a willing buyer would pay for our asset if we sold it, we will not know the ultimate value of our securities until
they are sold. We believe the valuation techniques utilized provide us with the best estimate of the price that would be received to sell our assets or transfer our liabilities in an orderly market transaction between participants at the measurement
date.

The following tables show the fair value of the Companys investments in accordance with FASBs ASC 820,
Fair Value Measurements and Disclosures as of March 31, 2011 and December 31, 2010.



|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|----------------------------------------------- |  | -------------- | ---------- |  | --------------- | - | ---------- | -------------------------------------- |  | - | -------------------------------------------- |  |  | ---------------------------------------- | ---------- |  |  | - | --------- | 
|                                                |  |                |            |  |                 |   |            | Fair value measurement using:          | 
|                                                |  | Carryingamount |            |  | Total fairvalue |   |            | Quoted pricesin
activemarkets(Level 1) |  |   | Significant otherobservable 
inputs(Level 2) |  |  | Significantunobservable 
inputs(Level 3) |           
|As of March 31, 2011                            |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|U.S. government agency securities               |  | $              | 1,948,417  |  |                 | $ | 1,948,417  |                                        |  | $ |                                             |  |  | $                                        | 1,948,417  |  |  | $ |          | 
|Obligations of state and political subdivisions |  |                | 8,511,013  |  |                 |   | 8,511,013  |                                        |  |   |                                              |  |  |                                          | 8,511,013  |  |  |   |           | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|Total fixed maturity investments                |  |                | 10,459,430 |  |                 |   | 10,459,430 |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|Equity securities (excluding the hedge fund)    |  |                | 13,511,293 |  |                 |   | 13,511,293 |                                        |  |   | 13,511,293                                   |  |  |                                          |            |  |  |   |           | 
|Hedge fund                                      |  |                | 1,503,103  |  |                 |   | 1,503,103  |                                        |  |   |                                              |  |  |                                          |            |  |  |   | 1,503,103 | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|Total equity securities                         |  |                | 15,014,396 |  |                 |   | 15,014,396 |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|Total investments                               |  | $              | 25,473,826 |  |                 | $ | 25,473,826 |                                        |  | $ | 13,511,293                                   |  |  | $                                        | 10,459,430 |  |  | $ | 1,503,103 | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|                                                |  |                |           
|                                                |  |                |            |  |                 |   |            | Fair value measurement using:          | 
|                                                |  | Carryingamount |            |  | Total fairvalue |   |            | Quoted pricesin
activemarkets(Level 1) |  |   | Significant otherobservable 
inputs(Level 2) |  |  | Significantunobservable 
inputs(Level 3) |           
|As of December 31, 2010                         |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|U.S. government agency securities               |  | $              | 1,959,588  |  |                 | $ | 1,959,588  |                                        |  | $ |                                             |  |  | $                                        | 1,959,588  |  |  | $ |          | 
|Obligations of state and political subdivisions |  |                | 8,465,737  |  |                 |   | 8,465,737  |                                        |  |   |                                              |  |  |                                          | 8,465,737  |  |  |   |           | 
|Corporate debt securities                       |  |                | 504,156    |  |                 |   | 504,156    |                                        |  |   |                                              |  |  |                                          | 504,156    |  |  |   |           | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|Total fixed maturity investments                |  |                | 10,929,481 |  |                 |   | 10,929,481 |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|Equity securities (excluding the hedge fund)    |  |                | 14,145,124 |  |                 |   | 14,145,124 |                                        |  |   | 14,145,124                                   |  |  |                                          |            |  |  |   |           | 
|Hedge fund                                      |  |                | 1,484,884  |  |                 |   | 1,484,884  |                                        |  |   |                                              |  |  |                                          |            |  |  |   | 1,484,884 | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|Total equity securities                         |  |                | 15,630,008 |  |                 |   | 15,630,008 |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 
|Total investments                               |  | $              | 26,559,489 |  |                 | $ | 26,559,489 |                                        |  | $ | 14,145,124                                   |  |  | $                                        | 10,929,481 |  |  | $ | 1,484,884 | 
|                                                |  |                |            |  |                 |   |            |                                        |  |   |                                              |  |  |                                          |            |  |  |   |           | 



9



---

The following table presents a reconciliation of the beginning and ending balance of
investments measured at fair value on a recurring basis using significant unobservable (Level 3) inputs for the quarters ended March 31, 2011 and 2010.



|                                                   |  |                                         |           |  |               |   |           | 
|-------------------------------------------------- |  | --------------------------------------- | --------- |  | ------------- | - | --------- | 
|                                                   |  | Hedge Fund 
InvestmentThree Monthsended |          
|                                                   |  | March 31,2011                           |           |  | March 31,2010 |  
|Balance classified as Level 3, beginning of period |  | $                                       | 1,484,884 |  |               | $ | 1,389,737 | 
|Total gains or losses included in earnings:        |  |                                         |          |  |               |   |          | 
|Net realized gains                                 |  |                                         |          |  |               |   |          | 
|Change in fair value of hedge fund investments     |  |                                         | 18,219    |  |               |   | 12,067    | 
|Purchases or sales                                 |  |                                         |          |  |               |   |          | 
|Transfers in and/or out of Level 3                 |  |                                         |          |  |               |   |          | 
|                                                   |  |                                         |           |  |               |   |           | 
|Ending balance, end of period                      |  | $                                       | 1,503,103 |  |               | $ | 1,401,804 | 
|                                                   |  |                                         |           |  |               |   |           | 

There were no transfers into or from the Level 3 hierarchy during the quarters ended March 31, 2011 and
March 31, 2010.

The cost or amortized cost and estimated fair value of fixed maturity investments as of March 31, 2011
and December 31, 2010 by contractual maturity are shown below. Expected maturities may differ from contractual maturities as borrowers may have the right to call or prepay obligations without penalties.



|                                       |  |               |            |  |                      |   |            | 
|-------------------------------------- |  | ------------- | ---------- |  | -------------------- | - | ---------- | 
|                                       |  | AmortizedCost |            |  | EstimatedFair 
Value |  
|As of March 31, 2011                   |  |               |            |  |                      |   |            | 
|Due in one year or less                |  | $             | 500,248    |  |                      | $ | 497,993    | 
|Due after one year through five years  |  |               | 5,995,844  |  |                      |   | 6,244,438  | 
|Due after five years through ten years |  |               | 3,730,592  |  |                      |   | 3,716,999  | 
|Due after ten years                    |  |               |           |  |                      |   |           | 
|                                       |  |               |            |  |                      |   |            | 
|Total                                  |  | $             | 10,226,684 |  |                      | $ | 10,459,430 | 
|                                       |  |               |            |  |                      |   |            | 
|                                       |  |              
|                                       |  | AmortizedCost |            |  | EstimatedFair 
Value |  
|As of December 31, 2010                |  |               |            |  |                      |   |            | 
|Due in one year or less                |  | $             | 1,001,198  |  |                      | $ | 1,002,080  | 
|Due after one year through five years  |  |               | 7,398,409  |  |                      |   | 7,633,631  | 
|Due after five years through ten years |  |               | 2,339,658  |  |                      |   | 2,293,770  | 
|Due after ten years                    |  |               |           |  |                      |   |           | 
|                                       |  |               |            |  |                      |   |            | 
|Total                                  |  | $             | 10,739,265 |  |                      | $ | 10,929,481 | 
|                                       |  |               |            |  |                      |   |            | 

Information on sales and maturities of investments during the quarters ended March 31, 2011 and 2010 are as follows:



|                                                             |  |               |           |   |               |   |          |  
|------------------------------------------------------------ |  | ------------- | --------- | - | ------------- | - | -------- | -
|                                                             |  | March 31,2011 |           |   | March 31,2010 |  
|Total proceeds on sales of available-for-sale securities     |  | $             | 1,673,979 |   |               | $ | 585,181  |  
|Total proceeds from maturities of fixed maturity investments |  |               | 500,000   |   |               |   |         |  
|Gross gains on sales                                         |  |               | 843,007   |   |               |   | 574,543  |  
|Gross losses on sales                                        |  |               | (26,239   | ) |               |   | (262,175 | )
|Impairment losses                                            |  |               |          |   |               |   |         |  



10



---

Major categories of net interest and dividend income during the quarters ended
March 31, 2011 and 2010 are summarized as follows:



|                           |  |               |         |   |               |   |         |  
|-------------------------- |  | ------------- | ------- | - | ------------- | - | ------- | -
|                           |  | March 31,2011 |         |   | March 31,2010 |  
|Interest earned:           |  |               |         |   |               |   |         |  
|Fixed maturity investments |  | $             | 88,982  |   |               | $ | 77,649  |  
|Cash and cash equivalents  |  |               | 52      |   |               |   | 152     |  
|Dividends earned           |  |               | 42,512  |   |               |   | 39,794  |  
|Investment expenses        |  |               | (36,202 | ) |               |   | (40,423 | )
|                           |  |               |         |   |               |   |         |  
|Net investment income      |  | $             | 95,344  |   |               | $ | 77,172  |  
|                           |  |               |         |   |               |   |         |  



|3. | SEGMENT INFORMATION
|-- | -------------------

AmerInst has two operating segments: 1) reinsurance activity, which includes investments and other activities, and 2) insurance activity,
which offers professional liability solutions to professional service firms.

The disclosure of RINITS, its financing
product, which offers a mechanism to securitize insurance and reinsurance risk, involving property, casualty, life and health lines of insurance, as a separate operating segment was discontinued in the fourth quarter of 2010 as it no longer met the
quantitative thresholds prescribed by ASC 280, Segment Reporting.



|                          |  |                                   |         |  |                  |   |          |       |  |   |           |  
|------------------------- |  | --------------------------------- | ------- |  | ---------------- | - | -------- | ----- |  | - | --------- | -
|                          |  | Three Months Ended March 31, 2011 |        
|                          |  | ReinsuranceSegment                |         |  | InsuranceSegment |   |          | Total | 
|Revenues                  |  | $                                 | 957,558 |  |                  | $ | 72,653   |       |  | $ | 1,030,211 |  
|Total losses and expenses |  |                                   | 396,107 |  |                  |   | 813,029  |       |  |   | 1,209,136 |  
|Segment income (loss)     |  | $                                 | 561,451 |  |                  | $ | (740,376 | )     |  | $ | (178,925  | )
|Identifiable assets       |  | $                                 |        |  |                  | $ | 730,015  |       |  | $ | 730,015   |  
|                          | 
|                          |  | Three Months Ended March 31, 2010 |        
|                          |  | ReinsuranceSegment                |         |  | InsuranceSegment |   |          | Total | 
|Revenues                  |  | $                                 | 485,894 |  |                  | $ | 1,313    |       |  | $ | 487,207   |  
|Total losses and expenses |  |                                   | 314,287 |  |                  |   | 607,749  |       |  |   | 922,036   |  
|Segment income (loss)     |  | $                                 | 171,607 |  |                  | $ | (606,436 | )     |  | $ | (434,829  | )
|Identifiable assets       |  | $                                 |        |  |                  | $ | 239,062  |       |  | $ | 239,062   |  

The 2010 balances
have been recast to reflect the discontinuation of the disclosure of RINITS as a separate operating segment in the fourth quarter of 2010 and the inclusion of the related balances within the reinsurance segment.



|4. | STOCK COMPENSATION
|-- | ------------------

AmerInst Professional Services Limited (APSL), a subsidiary of AmerInst, has entered into employment agreements with four key
members of senior management, which grant them phantom shares of the Company. Under these agreements, these employees were initially granted a total of 75,018 phantom shares of the Company on the date of their employment. The phantom shares are
eligible for phantom dividends paid at the same rate as regular dividends on the Companys common shares. The phantom dividends may be used only to purchase additional phantom shares with the purchase price of such phantom shares being the net
book value of the Companys actual common shares as of the end of the previous quarter. During the three months ended March 31, 2011, approximately 964 phantom shares were granted arising from the dividends declared on the Companys
common shares. Approximately 77,850 phantom shares were outstanding at March 31, 2011.

The employees interest in
the phantom shares initially granted as well as any additional shares granted from dividends declared will vest on January 1, 2015. The liability payable to the employees under this phantom share plan is equal to the difference between the
value of the phantom shares based on the net book value of the Companys actual common shares at the end of the previous quarter less the initial value and is payable in cash upon the earlier of the employee attaining 65 years of age or within
60 days of death or permanent disability, including if such death or permanent disability occurs before January 1, 2015.



11



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The liability relating to these phantom shares is recalculated quarterly based on the net
book value of the Companys common shares at the end of each quarter. As a result of the overall decrease in the book value of the Companys common shares since the grant dates, no liability has been recorded by the Company relating to
these phantom shares at March 31, 2011.



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations
|------- | -------------------------------------------------------------------------------------

Managements discussion and analysis (MD&A) provides supplemental information, which sets forth the major factors
that have affected our financial condition and results of operation and should be read in conjunction with our consolidated financial statements and notes thereto included in this Form 10-Q.

Certain statements contained in this Form 10-Q, including this MD&A section, are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, and contain information relating to us that is based on the beliefs of our management as well as assumptions made by, and information currently available to, our management. The words
expect, believe, may and similar expressions as they relate to us or our management are intended to identify forward-looking statements.

All forward-looking statements, by their nature, are subject to risks and uncertainties. Our actual future results may differ materially from those set forth in our forward-looking statements. Please see
the Introductory Note and Item 1A Risk Factors of our 2010 Annual Report or Form 10-K, as updated in our subsequent quarterly reports filed on Form 10-Q, and in our other filings made from time to time with the SEC after the date of
this report for a discussion of factors that could cause our actual results to differ materially from those in the forward-looking statements. However, the risk factors listed in Item 1A Risk Factors or discussed in this Form 10-Q
should not be construed as exhaustive and should be read in conjunction with other cautionary statements that are included herein. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect our
managements analysis only as of the date they are made. We undertake no obligation to release publicly the results of any future revisions we may make to forward-looking statements to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.

The following discussion addresses our financial condition and results of
operations for the periods and as of the dates indicated.

OVERVIEW

Unless otherwise indicated by the context, in this quarterly report we refer to AmerInst Insurance Group, Ltd. and its subsidiaries as the
Company, AmerInst, we or us. AMIC Ltd. means AmerInsts wholly-owned subsidiary, AmerInst Insurance Company, Ltd. APSL means AmerInst Professional Services, Limited, a
Delaware corporation and wholly-owned subsidiary of AmerInst Mezco, Ltd. (Mezco) which is a wholly-owned subsidiary of AmerInst. Investco means AmerInst Investment Company, Ltd., a wholly-owned subsidiary of AMIC Ltd.
AMIG means our predecessor entity, AmerInst Insurance Group, Inc., a Delaware corporation. Our principal offices are c/o Cedar Management Limited, 25 Church Street, Continental Building, P.O. Box HM 1601, Hamilton, Bermuda, HM GX.

AmerInst, a Bermuda holding company, was formed in 1998. Our mission is to be a company that provides insurance protection
for professional service firms and engages in investment activities.

Entry into Agency Agreement

Effective September 25, 2009, APSL entered into an agency agreement (the Agency Agreement) with The North River Insurance
Company, United States Fire Insurance Company, Crum & Forster Indemnity Company, Crum and Forster Insurance Company, and Crum & Forster Specialty Insurance Company (collectively, C&F) pursuant to which C&F
appointed APSL as its exclusive agent for the purposes of soliciting, underwriting, quoting, binding, issuing, cancelling, non-renewing and endorsing accountants professional liability and lawyers professional liability insurance
coverage within the 50 states of the United States and the District of Columbia. The initial term of the Agency Agreement is for four years with automatic one year renewals.

Entry into Reinsurance Agreement

We conduct our reinsurance
business through AMIC Ltd., our subsidiary, which is a registered insurer in Bermuda. On September 25, 2009, AMIC Ltd. entered into a professional liability quota share agreement with C&F (the Reinsurance Agreement) pursuant to
which C&F agrees to cede and AMIC Ltd. agrees to accept as reinsurance a 50% quota share of C&Fs liability under insurance written by APSL on behalf of C&F and classified by C&F as accountants professional liability
and lawyers professional liability, subject to AMIC Ltd.s surplus limitations. The initial term of the Reinsurance Agreement is for four years with automatic one year renewals.



12



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Historical Relationship with CAMICO

From June 1, 2005 through May 31, 2009, we were a party to a reinsurance contract with CAMICO Mutual Insurance Company
(CAMICO) a California-based writer of accountants professional liability business.

Effective June 1,
2009, we decided not to renew the CAMICO contract and permitted the contract to expire pursuant to its terms. We remain potentially liable for claims related to coverage through May 31, 2009.

VSC Payment

On July 22, 2009, the Company received a payment of $500,891 from Virginia Surety Company (VSC) in satisfaction of certain recoveries not previously remitted by VSC under retrocession
contracts between the Company and VSC for the years 1989-1993. The $500,891 payment was recorded as a decrease in losses and loss adjustment expenses in the year ended December 31, 2009. The Company and VSC are in dispute with respect to over
$500,000 in additional recoveries, fees and interest, which is currently in arbitration.

Attorneys Professional
Liability Coverage

Effective January 1, 2003, we entered into a 15% quota share participation of the
attorneys professional liability coverage provided by Professionals Direct Insurance Company (PDIC). This participation terminated on December 31, 2003. We remain potentially liable for claims related to this period of
coverage.

Third-party Managers and Service Providers

Cedar Management Limited provides the day-to-day services necessary for the administration of our business. Our agreement with Cedar
Management Limited renewed for one year beginning January 1, 2011 and ending December 31, 2011. Mr. Stuart Grayston, our President, was formally a director and officer of Cedar Management Limited, and Mr. Thomas R. McMahon,
our Treasurer and Chief Financial Officer, is an officer, director and employee of Cedar Management Limited.

Mowery & Schoenfeld, LLC, an accounting firm affiliated with a former director and chairman emeritus, provides accounting
functions to APSL. Our agreement with Mowery & Schoenfeld, LLC renewed for one year beginning January 1, 2011 and ending December 31, 2011, pursuant to a letter of understanding dated February 3, 2011. While the letter of
understanding has no termination notice clause, it can be terminated by either party.

The Country Club Bank of Kansas City,
Missouri, provides portfolio management of fixed maturity securities and directs our investments pursuant to guidelines approved by us. Harris Associates L.P. and Aurora Investment Management, LLC provide discretionary investment advice with respect
to our equity investments. We have retained Milliman USA, an independent casualty actuarial consulting firm, to render advice regarding actuarial matters.

OPERATIONS

Three months ended March 31, 2011 compared to three months ended
March 31, 2010

We recorded a net loss of $178,925 for the first quarter of 2011 compared to net loss of $434,829 for
the same period in 2010. The net losses recorded during the first quarters of 2011 and 2010 were largely attributable to operating and management expenses incurred by APSL, partially offset by net realized gains on investments.

Our net premiums earned for the first quarter of 2011 were $45,490 compared to $96,410 for the first quarter of 2010, a decrease of
$50,920 or 52.8%. The net premiums earned during the first quarter of 2011 were attributable to premiums written under the Reinsurance Agreement. The net premiums earned during the first quarter of 2010 were attributable to revisions to CAMICO
premium estimates for prior years.

For the quarters ended March 31, 2011 and 2010, we recorded commission income of
$72,609 and $1,257, respectively, under the Agency Agreement, an increase of $71,352. This increase resulted from a higher level of underwriting activity under the Agency Agreement in 2011.

We recorded net investment income of $95,344 for the quarter ended March 31, 2011 compared to $77,172 for the quarter ended
March 31, 2010, an increase of $18,172 or 23.5%. The increase resulted from higher yielding fixed income securities held in the Companys investment portfolio during the first quarter of 2011 compared to the same period of 2010.
Annualized investment yield, calculated as total interest and dividends divided by the net average amount of total investments, was 1.4% for the quarter ended March 31, 2011, a marginal increase from the 1.0% yield earned for the quarter ended
March 31, 2010.

Sales of securities during the quarter ended March 31, 2011 resulted in realized gains on
investments net of impairment of $816,768 compared to $312,368 during the quarter ended March 31, 2010, an increase of $504,400 or 161.5%. The increase in realized gains recorded in the first quarter of 2011 primarily related to increased sales
of equity securities in an unrealized gain position compared to 2010.



13



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Our loss ratios for the first quarter of 2011 and 2010 were 62.5% and 0.0%, respectively.
For the quarter ended March 31, 2011, we recorded loss and loss adjustment expenses of $28,452 derived by multiplying our estimated loss ratio of 62.5% and the premiums earned under the Reinsurance Agreement of $45,490. For the first quarter of
2010, the Company paid total losses amounting to $106,376 in respect of claims which had been specifically reserved for. The specific reserves held by the Company for these claims were consequently reduced to nil explaining the 0.0% loss ratio for
the quarter ended March 31, 2010.

We recorded policy acquisition costs of $16,831 in the first quarter of 2011 compared
to policy acquisition recoveries of $29,175 for the same period of 2010. The policy acquisition costs recorded in the first quarter of 2011 were 37% of the premium earned under the Reinsurance Agreement. The policy acquisition recoveries recorded in
the first quarter of 2010 were attributable to the revisions to the CAMICO premium estimates for prior years as noted above.

We expensed operating and management expenses of $1,163,853 in the first quarter of 2011 compared to $951,211 for the same period of
2010, an increase of $212,642 or 22.4%. The primary reasons for this is (1) the increase in APSL salaries and wages as a result of additional headcount and (2) the increase in professional, marketing, and consulting expenses as APSL
continues to expand its operations.

The tables below disclose segment income and loss for the following AmerInst operating
segments: 1) reinsurance activity, which includes investments and other activities, and 2) insurance activity, which offers professional liability solutions to professional service firms under the Agency Agreement with C&F.

The disclosure of RINITS as a separate operating segment was discontinued in the fourth quarter of 2010 for it no longer met the
quantitative thresholds as prescribed by ASC 280, Segment Reporting.



|                          |  |                                   |         |  |                  |   |          |       |  |   |           |  
|------------------------- |  | --------------------------------- | ------- |  | ---------------- | - | -------- | ----- |  | - | --------- | -
|                          |  | Three Months Ended March 31, 2011 |        
|                          |  | ReinsuranceSegment                |         |  | InsuranceSegment |   |          | Total | 
|Revenues                  |  | $                                 | 957,558 |  |                  | $ | 72,653   |       |  | $ | 1,030,211 |  
|Total losses and expenses |  |                                   | 396,107 |  |                  |   | 813,029  |       |  |   | 1,209,136 |  
|Segment income (loss)     |  | $                                 | 561,451 |  |                  | $ | (740,376 | )     |  | $ | (178,925  | )
|Identifiable assets       |  | $                                 |        |  |                  | $ | 730,015  |       |  | $ | 730,015   |  
|                          | 
|                          |  | Three Months Ended March 31, 2010 |        
|                          |  | ReinsuranceSegment                |         |  | InsuranceSegment |   |          | Total | 
|Revenues                  |  | $                                 | 485,894 |  |                  | $ | 1,313    |       |  | $ | 487,207   |  
|Total losses and expenses |  |                                   | 314,287 |  |                  |   | 607,749  |       |  |   | 922,036   |  
|Segment income (loss)     |  | $                                 | 171,607 |  |                  | $ | (606,436 | )     |  | $ | (434,829  | )
|Identifiable assets       |  | $                                 |        |  |                  | $ | 239,062  |       |  | $ | 239,062   |  

The 2010 balances
have been recast to reflect the discontinuation of the disclosure of RINITS as a separate operating segment in the fourth quarter of 2010 and the inclusion of the related balances within the reinsurance segment.

LIQUIDITY AND CAPITAL RESOURCES

In late 2008 and into 2009, the capital markets were illiquid, reflecting uncertainties associated with the mortgage crisis, worsening economic conditions, widening of credit spreads, bankruptcies and
government intervention in large financial institutions. Though current market conditions appear to have improved there is still the potential for further instability. This could present additional risks and uncertainties for our business and make
it more difficult to value certain of our securities if trading becomes less frequent. As such, valuations may include assumptions and estimates that may have significant period-to-period changes that could have a material adverse effect on our
results of operations or financial condition.

As of March 31, 2011, our total investments were $25,473,826 a decrease of
$1,085,663, or 4.1%, from $26,559,489 at December 31, 2010. The decrease was primarily due to sales of certain equity securities and the maturity of a fixed maturity security. The cash and cash equivalents balance increased from $970,697 at
December 31, 2010 to $1,048,576 at March 31, 2011, an increase of $77,879 or 8.0%. The amount of cash and cash equivalents varies depending on the maturities of fixed term investments and on the level of funds invested in money market
funds. The restricted cash and cash equivalents balance increased from $84,256 at December 31, 2010 to $168,341 at March 31, 2011, an increase of $84,085 or 99.8%. The increase is due to the timing of sales and maturities of investments
held as restricted cash at March 31, 2011 that have not yet been reinvested. The ratio of cash and total investments to total liabilities at March 31, 2011 was 11.47:1, compared to a ratio of 11.04:1 at December 31, 2010.



14



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The decrease in total cash and investments at March 31, 2011, compared to
December 31, 2010 resulted primarily from i) net cash outflows relating to APSL, which is still in the development stage and ii) dividends of $328,691 paid during the first quarter of 2011, partially offset by positive cash inflows from
investment operations.

Assumed reinsurance balances receivable represent current assumed premiums receivable less commissions
payable to the fronting carriers. As of March 31, 2011, the balance was $87,535 compared to $45,909 as of December 31, 2010. The increase is attributable to the continued expansion of APSL business under the Reinsurance Agreement.

Assumed reinsurance payable represents current reinsurance losses payable to the fronting carriers. As of March 31,
2011, the balance was $10,075 compared to $76,918 as of December 31, 2010. This balance fluctuates due to the timing of reported losses.

The Bermuda Monetary Authority has authorized Investco to purchase the Companys common shares from shareholders who have died or retired from the practice of public accounting and on a negotiated
basis. During the quarter ended March 31, 2011, no such transactions occurred. Through March 31, 2011, Investco had purchased 123,913 common shares from shareholders who had died or retired for a total purchase price of $3,214,353. From
time to time, Investco has also purchased shares in privately negotiated transactions. Through March 31, 2011, Investco had purchased an additional 75,040 common shares in such privately negotiated transactions for a total purchase price of
$1,108,228.

Cash Dividends

We paid our semi-annual dividends of $0.47 per share during the first quarter of 2011, which amounted to ordinary cash dividends of $328,691. Since AmerInst began paying consecutive dividends in 1995, our
original shareholders have received $18.40 in cumulative dividends per share. When measured by a total rate of return calculation this has resulted in an effective annual rate of return of approximately 10.27% from the inception of the Company,
based on a per share purchase price of $8.33 paid by the original shareholders, and using an unaudited book value of $36.53 per share as of March 31, 2011.

Critical Accounting Policies

The Companys critical accounting
policies are discussed in Managements Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended December 31, 2010.

Available Information

We file annual, quarterly, and current reports, proxy statements and other information with the Commission. You may read any public
document we file with the Commission at the Commissions public reference room at 100 F Street, NE, Washington, DC 20549. Please call the Commission at 1-800-SEC-0330 for information on the public reference room. The Commission maintains an
internet site that contains annual, quarterly, and current reports, proxy and information statements and other information that issuers (including AmerInst) file electronically with the Commission. The Commissions internet site is
www.sec.gov.

Our internet site is www.amerinst.bm. We make available free of charge through our internet site
our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports filed or furnished pursuant to the Securities Exchange Act of 1934, as soon as reasonably practicable after such material
is electronically filed with, or furnished to, the Commission. We also make available, through our internet site, via links to the Commissions internet site, statements of beneficial ownership of our equity securities filed by our directors,
officers, 10% or greater shareholders and others under Section 16 of the Securities Exchange Act. In addition, we post on www.amerinst.bm our Memorandum of Association, our Bye-Laws, our Statement of Share Ownership Policy, Charters for
our Audit Committee and Governance and Nominations Committee, as well as our Code of Business Conduct and Ethics. You can request a copy of these documents, excluding exhibits, at no cost, by writing or telephoning us c/o Cedar Management Limited,
25 Church Street, Continental Building, P.O. Box HM 1601 Hamilton, Bermuda HMGX, Attention: Investor Relations (441) 295-6015. The information on our internet site is not incorporated by reference into this report.



|Item 4. | Controls and Procedures
|------- | -----------------------

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our
management, including our Principal Executive Officer and our Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934.
Based upon that evaluation, our Principal Executive Officer and our Principal Financial Officer concluded that our disclosure controls and procedures were effective. There has been no change in our internal control over financial reporting
identified in that evaluation that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.



15



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Part IIOTHER INFORMATION



|Item 1. | Legal Proceedings
|------- | -----------------

The
Company is not a party to any material legal proceedings.



|Item 1A. | Risk Factors
|-------- | ------------

There have
been no material changes in our risk factors from those disclosed in our 2010 Annual Report on Form 10-K.



|Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds
|------- | -----------------------------------------------------------

From time to time, the Company has repurchased its common shares from individual shareholders who have died or retired from the practice of accounting. From time to time, the Company has also repurchased
its common shares from individual shareholders in privately negotiated transactions. No such transactions occurred during the three month period ended March 31, 2011.



|Item 6. | Exhibits
|------- | --------

(a) Exhibits

See Index to Exhibits immediately following the signature page.



16



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SIGNATURES

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



|                    |  |                                |  |                       
|------------------- |  | ------------------------------ |  | ----------------------
|Dated: May 12, 2011 |  | AMERINST INSURANCE GROUP, LTD.
|                    |  | (Registrant)                  
|                    |  |                               
|                    |  | By:                            |  | /S/ STUART H.
GRAYSTON

| |  |  |  |                                                                                                                              
| |  |  |  | -----------------------------------------------------------------------------------------------------------------------------
| |  |  |  | Stuart H. Grayston                                                                                                           
| |  |  |  | President (Principal Executive Officer, duly authorized to sign this Report in such capacity and on behalf of the
Registrant)

| |  |     |  |                      
| |  | --- |  | ---------------------
| |  |    
| |  | By: |  | /S/ THOMAS R.
MCMAHON

| |  |  |  |                                                                                                                                            
| |  |  |  | -------------------------------------------------------------------------------------------------------------------------------------------
| |  |  |  | Thomas R. McMahon                                                                                                                          
| |  |  |  | Chief Financial Officer (Principal Financial Officer, duly authorized to sign this Report in such capacity and on behalf of the Registrant)



17



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AMERINST INSURANCE GROUP, LTD.

INDEX TO EXHIBITS

Filed with the Quarterly Report on Form 10-Q for the Quarter Ended March 31, 2011



|              |  |                                                                                                                                             
|------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------
|ExhibitNumber |  | Description                                                                                                                                 
|              | 
|31.1          |  | Certification of Stuart H. Grayston pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                              
|              | 
|31.2          |  | Certification of Thomas R. McMahon pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                               
|              | 
|32.1          |  | Certification of Stuart H. Grayston 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 Thomas R. McMahon pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 



18