|   |  FORM 10-Q |   |
|--------|-----------------|--------|

| QUARTERLY REPORT                                                       |
|------------------------------------------------------------------------|
| Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
|                                                                   |
| For the quarterly period ended March 31, 2011                          |

|   |   |   |
|--------|--------|--------|

| KENTUCKY                                                       |   | 61-6030333                              |
|----------------------------------------------------------------|--------|-----------------------------------------|
| (State or other jurisdiction of incorporation or organization) |   | (I.R.S. Employer Identification Number) |
|                                                           |
| 200 Capital Avenue, P.O. Box 717                               |
| Frankfort, Kentucky 40602                                      |
| (Address of principal executive offices)                       |
|                                                           |
| (502) 223-2361                                                 |
| (Registrant’s telephone number, including area code)     |

|   |   |   |
|--------|--------|--------|

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

----

| Securities registered pursuant to Section 12(g) of the Act:     |
|-----------------------------------------------------------------|
|                                                            |
| Common Capital Stock par value $1.00 per share                  |
| (Title of Class)                                                |
|                                                            |
| Number of outstanding shares as of May 4 , 2011 - 1,151,817.276 |

----

|         | PART I – FINANCIAL INFORMATION                                                        |   |
|--------------|---------------------------------------------------------------------------------------------|--------|
|         |                                                                                        | Page   |
| ITEM 1.      | Condensed Consolidated Financial Statements                                                 | 4      |
| ITEM 2.      | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 20     |
| ITEM 4.      | Controls and Procedures                                                                     | 27     |
|         |                                                                                        |   |
|         |                                                                                        |   |
|         |                                                                                        |   |
|         | PART II – OTHER INFORMATION                                                           |   |
|         |                                                                                        |   |
| ITEM 1.      | Legal Proceedings                                                                           | 28     |
| ITEM 2.      | Unregistered Sales of Equity Securities and Use of Proceeds                                 | 28     |
| ITEM 3.      | Defaults Upon Senior Securities                                                             | 28     |
| ITEM 4.      | (Removed and Reserved)                                                                      | 28     |
| ITEM 5.      | Other Information                                                                           | 28     |
| ITEM 6.      | Exhibits                                                                                    | 28     |
|         |                                                                                        |   |
|         |                                                                                        |   |
| SIGNATURES   |                                                                                        | 29     |
|         |                                                                                        |   |
| EXHIBIT 31.1 |                                                                                        | 30     |
| EXHIBIT 31.2 |                                                                                        | 32     |
| EXHIBIT 32   |                                                                                        | 34     |

----

| INVESTORS HERITAGE CAPITAL CORPORATION            |
|---------------------------------------------------|
| Condensed Consolidated Balance Sheets (Unaudited) |

|                                                                                                             |   | March 31, |        |   | December 31, |   |
|------------------------------------------------------------------------------------------------------------------|--------|-----------|-------------|--------|--------------|--------|
| ASSETS                                                                                                           |   | 2011      |        |   | 2010         |   |
|   Investments:                                                                                         |   |      |        |   |         |   |
|      Securities available-for-sale, at fair value:                                      |   |      |        |   |         |   |
|         Fixed maturities (amortized cost: $298,767,885 and $295,589,089) |   | $         | 315,069,217 |   |         | $      | 313,456,262 |   |
|         Equity securities (cost: $3,877,775 and $3,877,775)              |   |      | 4,768,509   |   |         |   | 4,524,771 |   |
|      Mortgage loans on real estate                                                      |   |      | 18,965,707  |   |         |   | 19,817,478 |   |
|      Policy loans                                                                       |   |      | 6,908,128   |   |         |   | 6,949,374 |   |
|      Other long-term investments                                                        |   |      | 1,385,526   |   |         |   | 1,454,232 |   |
|      Short-term investments                                                             |   |      | -           |   |         |   | 491,041 |   |
|      Total investments                                                                  |   |      | 347,097,087 |   |         |   | 346,693,158 |   |
|                                                                                                             |   |      |        |   |         |   |   |   |
|   Cash and cash equivalents                                                                            |   |      | 1,622,226   |   |         |   | 2,647,798 |   |
|   Accrued investment income                                                                            |   |      | 3,745,025   |   |         |   | 3,926,591 |   |
|   Due premiums                                                                                         |   |      | 3,840,766   |   |         |   | 3,772,069 |   |
|   Deferred acquisition costs                                                                           |   |      | 17,277,022  |   |         |   | 17,450,827 |   |
|   Value of business acquired                                                                           |   |      | 808,291     |   |         |   | 867,881 |   |
|   Leased property under capital leases                                                                 |   |      | 51,651      |   |         |   | 72,461 |   |
|   Property and equipment                                                                               |   |      | 1,813,365   |   |         |   | 1,582,958 |   |
|   Cash value of company-owned life insurance                                                           |   |      | 9,062,010   |   |         |   | 9,021,432 |   |
|   Other assets                                                                                         |   |      | 670,904     |   |         |   | 444,340 |   |
|   Amounts recoverable from reinsurers                                                                  |   |      | 43,454,730  |   |         |   | 44,109,932 |   |
|   Total assets                                                                                         |   | $         | 429,443,077 |   |         | $      | 430,589,447 |   |
|                                                                                                             |   |      |        |   |         |   |   |   |
| LIABILITIES AND STOCKHOLDERS' EQUITY                                                                             |   |      |        |   |         |   |   |   |
|   LIABILITIES                                                                                          |   |      |        |   |         |   |   |   |
|      Policy liabilities:                                                                |   |      |        |   |         |   |   |   |
|          Benefit reserves                                           |   | $         | 348,513,764 |   |         | $      | 348,745,910 |   |
|          Unearned premium reserves                                  |   |      | 8,607,012   |   |         |   | 8,726,074 |   |
|          Policy claims                                              |   |      | 1,759,918   |   |         |   | 1,887,136 |   |
|          Liability for deposit-type contracts                       |   |      | 2,818,027   |   |         |   | 2,791,261 |   |
|          Reserves for dividends and endowments and other            |   |      | 535,404     |   |         |   | 535,918 |   |
|          Total policy liabilities                                   |   |      | 362,234,125 |   |         |   | 362,686,299 |   |
|      Deferred federal income tax liability                                              |   |      | 6,109,690   |   |         |   | 6,598,944 |   |
|      Obligations under capital leases                                                   |   |      | 47,793      |   |         |   | 57,808 |   |
|      Notes payable                                                                      |   |      | 1,746,880   |   |         |   | 2,533,955 |   |
|      Accrued pension liability                                                          |   |      | 5,343,949   |   |         |   | 5,606,631 |   |
|      Other liabilities                                                                  |   |      | 3,699,215   |   |         |   | 1,933,347 |   |
|      Total liabilities                                                                  |   |      | 379,181,652 |   |         |   | 379,416,984 |   |
|                                                                                                             |   |      |        |   |         |   |   |   |
|   STOCKHOLDERS' EQUITY                                                                                 |   |      |        |   |         |   |   |   |
|      Common stock (shares issued:  1,151,817 and 1,151,817)                   |   |      | 1,151,817   |   |         |   | 1,151,817 |   |
|      Paid-in surplus                                                                    |   |      | 8,801,514   |   |         |   | 8,801,514 |   |
|      Accumulated other comprehensive income                                             |   |      | 6,754,991   |   |         |   | 7,482,092 |   |
|      Retained earnings                                                                  |   |      | 33,553,103  |   |         |   | 33,737,040 |   |
|      Total stockholders' equity                                                         |   |      | 50,261,425  |   |         |   | 51,172,463 |   |
|      Total liabilities and stockholders' equity                                         |   | $         | 429,443,077 |   |         | $      | 430,589,447 |   |

| See notes to consolidated financial statements. |
|-------------------------------------------------|

----

| INVESTORS HERITAGE CAPITAL CORPORATION               |
|------------------------------------------------------|
| Condensed Consolidated Income Statements (Unaudited) |

|                                                                       |   | Quarter Ended March 31, |       |
|----------------------------------------------------------------------------|--------|-------------------------|------------|
|                                                                       |   | 2011                    |       |   | 2010 |   |
| REVENUE                                                                    |   |                    |       |   |   |   |
|    Premiums and other considerations                        |   | $                       | 11,657,643 |   |   | $ | 9,278,184 |   |
|    Premiums ceded                                           |   |                    | (2,351,388 | ) |   |   | (1,369,412 | ) |
|      Net premiums earned                          |   |                    | 9,306,255  |   |   |   | 7,908,772 |   |
|                                                                       |   |                    |       |   |   |   |   |   |
|    Investment income, net of expenses                       |   |                    | 4,226,594  |   |   |   | 4,263,570 |   |
|    Net realized investment gains (losses) on investments:   |   |                    |       |   |   |   |   |   |
|      Total other-than-temporary impairment losses |   |                    | -          |   |   |   | - |   |
|      Portion of loss recognized in                |   |                    |       |   |   |   |   |   |
|        other comprehensive income       |   |                    | -          |   |   |   | - |   |
|      Other net realized investment gains (losses) |   |                    | (5,989     | ) |   |   | 72,811 |   |
|    Net realized investment gains (losses) on investments    |   |                    | (5,989     | ) |   |   | 72,811 |   |
|    Consideration on reinsurance assumed                     |   |                    | 13,117     |   |   |   | - |   |
|    Other income                                             |   |                    | 413,615    |   |   |   | 313,550 |   |
|      Total revenue                                |   |                    | 13,953,592 |   |   |   | 12,558,703 |   |
|                                                                       |   |                    |       |   |   |   |   |   |
| BENEFITS AND EXPENSES                                                      |   |                    |       |   |   |   |   |   |
|    Death and other benefits                                 |   |                    | 8,891,119  |   |   |   | 8,503,713 |   |
|    Guaranteed annual endowments                             |   |                    | 119,540    |   |   |   | 126,239 |   |
|    Dividends to policyholders                               |   |                    | 112,179    |   |   |   | 117,733 |   |
|    Increase in benefit reserves and unearned premiums       |   |                    | 1,091,303  |   |   |   | 729,085 |   |
|    Acquisition costs deferred                               |   |                    | (1,125,942 | ) |   |   | (1,112,037 | ) |
|    Amortization of deferred acquisition costs               |   |                    | 1,360,862  |   |   |   | 1,283,927 |   |
|    Commissions                                              |   |                    | 597,513    |   |   |   | 586,868 |   |
|    Other general and administrative expenses                |   |                    | 2,848,864  |   |   |   | 2,864,880 |   |
|      Total benefits and expenses                  |   |                    | 13,895,438 |   |   |   | 13,100,408 |   |
|                                                                       |   |                    |       |   |   |   |   |   |
| INCOME (LOSS) BEFORE FEDERAL INCOME TAXES                                  |   |                    | 58,154     |   |   |   | (541,705 | ) |
|                                                                       |   |                    |       |   |   |   |   |   |
| PROVISION (BENEFIT) FOR FEDERAL INCOME TAXES                               |   |                    |       |   |   |   |   |   |
|      Current                                      |   |                    | 104,443    |   |   |   | (10,812 | ) |
|      Deferred                                     |   |                    | (86,632    | ) |   |   | (136,749 | ) |
|        Total federal income taxes       |   |                    | 17,811     |   |   |   | (147,561 | ) |
|                                                                       |   |                    |       |   |   |   |   |   |
| NET INCOME (LOSS)                                                          |   | $                       | 40,343     |   |   | $ | (394,144 | ) |
|                                                                       |   |                    |       |   |   |   |   |   |
| BASIC AND DILUTED NET INCOME (LOSS) PER SHARE                              |   | $                       | 0.04       |   |   | $ | (0.35 | ) |
|                                                                       |   |                    |       |   |   |   |   |   |
| DIVIDENDS PER SHARE                                                        |   | $                       | 0.18       |   |   | $ | 0.13 |   |

| See notes to condensed consolidated financial statements. |
|-----------------------------------------------------------|

----

| INVESTORS HERITAGE CAPITAL CORPORATION                                |
|-----------------------------------------------------------------------|
| Condensed Consolidated Statements of Stockholders' Equity (Unaudited) |

|                                                                                                 |   |   |      |   |    |   |      | Accumulated   |   |   |      |   |   |          |       |
|------------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|---------|--------|-----------|---------------|--------|--------|-----------|--------|--------|---------------|------------|
|                                                                                                 |   |   |      |   |    |   |      | Other         |   |   |      |   |   | Total         |       |
|                                                                                                 |   | Common |      |   | Paid-in |   |      | Comprehensive |   |   | Retained  |   |   | Stockholders' |       |
|                                                                                                 |   | Stock  |      |   | Surplus |   |      | Income        |   |   | Earnings  |   |   | Equity        |       |
|                                                                                                 |   |   |      |   |    |   |      |          |   |   |      |   |   |          |       |
| BALANCE, JANUARY 1, 2010                                                                             |   | $      | 1,141,767 |   |    | $      | 8,716,135 |          |   | $      | 4,495,103 |   |   | $             | 31,321,874 |   |   | $ | 45,674,879 |   |
|                                                                                                 |   |   |      |   |    |   |      |          |   |   |      |   |   |          |       |   |   |   |   |   |
| Comprehensive income:                                                                                |   |   |      |   |    |   |      |          |   |   |      |   |   |          |       |   |   |   |   |   |
|   Net loss                                                                                 |   |   | -         |   |    |   | -         |          |   |   | -         |   |   |          | (394,144   | ) |   |   | (394,144 | ) |
|   Change in net unrealized appreciation on available-for-sale securities    |   |   | -         |   |    |   | -         |          |   |   | 2,250,050 |   |   |          | -          |   |   |   | 2,250,050 |   |
|   Change in unrealized pension benefits                                                    |   |   | -         |   |    |   | -         |          |   |   | 64,586    |   |   |          | -          |   |   |   | 64,586 |   |
|   Change in fair value of hedging instrument                                               |   |   | -         |   |    |   | -         |          |   |   | 2,358     |   |   |          | -          |   |   |   | 2,358 |   |
|      Total comprehensive income                                             |   |   |      |   |    |   |      |          |   |   |      |   |   |          |       |   |   |   | 1,922,850 |   |
|   Cash dividends                                                                           |   |   | -         |   |    |   | -         |          |   |   | -         |   |   |          | (160,821   | ) |   |   | (160,821 | ) |
|   Issuances of common stock, net                                                           |   |   | 2,053     |   |    |   | (9,331    | )             |   |   | -         |   |   |          | 52,425     |   |   |   | 45,147 |   |
| BALANCE, MARCH 31, 2010                                                                              |   | $      | 1,143,820 |   |    | $      | 8,706,804 |          |   | $      | 6,812,097 |   |   | $             | 30,819,334 |   |   | $ | 47,482,055 |   |
|                                                                                                 |   |   |      |   |    |   |      |          |   |   |      |   |   |          |       |   |   |   |   |   |
| BALANCE, JANUARY 1, 2011                                                                             |   | $      | 1,151,817 |   |    | $      | 8,801,514 |          |   | $      | 7,482,092 |   |   | $             | 33,737,040 |   |   | $ | 51,172,463 |   |
|                                                                                                 |   |   |      |   |    |   |      |          |   |   |      |   |   |          |       |   |   |   |   |   |
| Comprehensive income:                                                                                |   |   |      |   |    |   |      |          |   |   |      |   |   |          |       |   |   |   |   |   |
|   Net income                                                                               |   |   | -         |   |    |   | -         |          |   |   | -         |   |   |          | 40,343     |   |   |   | 40,343 |   |
|   Change in net unrealized appreciation on available-for-sale securities              |   |   | -         |   |    |   | -         |          |   |   | (813,735  | )      |   |          | -          |   |   |   | (813,735 | ) |
|   Change in unrealized pension benefits                                                    |   |   | -         |   |    |   | -         |          |   |   | 86,634    |   |   |          | -          |   |   |   | 86,634 |   |
|      Total comprehensive loss                                               |   |   |      |   |    |   |      |          |   |   |      |   |   |          |       |   |   |   | (686,758 | ) |
|   Cash dividends                                                                           |   |   | -         |   |    |   | -         |          |   |   | -         |   |   |          | (224,280   | ) |   |   | (224,280 | ) |
| BALANCE, MARCH 31, 2011                                                                              |   | $      | 1,151,817 |   |    | $      | 8,801,514 |          |   | $      | 6,754,991 |   |   | $             | 33,553,103 |   |   | $ | 50,261,425 |   |

| See notes to condensed consolidated financial statements. |
|-----------------------------------------------------------|

----

| INVESTORS HERITAGE CAPITAL CORPORATION                      |
|-------------------------------------------------------------|
| Condensed Consolidated Statements of Cash Flows (Unaudited) |

|                                                                            |   | Three Months Ended March 31, |        |
|---------------------------------------------------------------------------------|--------|------------------------------|-------------|
|                                                                            |   | 2011                         |        |   | 2010 |   |
|                                                                            |   |                         |        |   |   |   |
|                                                                            |   |                         |        |   |   |   |
| NET CASH PROVIDED BY OPERATING ACTIVITIES                                       |   | $                            | 2,863,343   |   |   | $ | 1,517,247 |   |
|                                                                            |   |                         |        |   |   |   |   |   |
| INVESTING ACTIVITIES                                                            |   |                         |        |   |   |   |   |   |
| Securities available-for-sale:                                                  |   |                         |        |   |   |   |   |   |
| Purchases                                                                       |   |                         | (14,316,950 | ) |   |   | (11,352,867 | ) |
| Sales and maturities                                                            |   |                         | 10,996,472  |   |   |   | 8,493,520 |   |
| Other investments:                                                              |   |                         |        |   |   |   |   |   |
| Cost of acquisitions                                                            |   |                         | (910,029    | ) |   |   | (972,529 | ) |
| Sales and maturities                                                            |   |                         | 2,363,531   |   |   |   | 999,919 |   |
| Net additions to property and equipment                                         |   |                         | (288,436    | ) |   |   | (90,970 | ) |
| NET CASH USED IN INVESTING ACTIVITIES                                           |   |                         | (2,155,412  | ) |   |   | (2,922,927 | ) |
| FINANCING ACTIVITIES                                                            |   |                         |        |   |   |   |   |   |
| Receipts from universal life policies credited to policyholder account balances |   |                         | 1,489,457   |   |   |   | 1,495,480 |   |
| Return of policyholder account balances on universal life policies              |   |                         | (2,435,885  | ) |   |   | (2,213,560 | ) |
| Payments on notes payable                                                       |   |                         | (1,873,445  | ) |   |   | (942,345 | ) |
| Proceeds from notes payable                                                     |   |                         | 1,086,370   |   |   |   | 675,972 |   |
| Issuances of common stock, net                                                  |   |                         | -           |   |   |   | 45,147 |   |
| NET CASH USED IN FINANCING ACTIVITIES                                           |   |                         | (1,733,503  | ) |   |   | (939,306 | ) |
| DECREASE IN CASH AND CASH EQUIVALENTS                                           |   |                         | (1,025,572  | ) |   |   | (2,344,986 | ) |
| Cash and cash equivalents at beginning of period                                |   |                         | 2,647,798   |   |   |   | 5,730,782 |   |
| CASH AND CASH EQUIVALENTS AT END OF PERIOD                                      |   | $                            | 1,622,226   |   |   | $ | 3,385,796 |   |

| See notes to consolidated financial statements. |
|-------------------------------------------------|

----

----

|                                          |   |      |        |   | Gross      |   |       | Gross      |   |   |      |   |
|-----------------------------------------------|--------|-----------|-------------|--------|------------|--------|------------|------------|--------|--------|-----------|--------|
| March 31, 2011                                |   | Amortized |        |   | Unrealized |   |       | Unrealized |   |   | Fair      |   |
|                                          |   | Cost      |        |   | Gains      |   |       | Losses     |   |   | Value     |   |
| Fixed maturity securities:                    |   |      |        |   |       |   |       |       |   |   |      |   |
| U.S. government obligations                   |   | $         | 35,171,748  |   |       | $      | 1,681,710  |       |   | $      | 6,409     |   |   | $ | 36,847,049 |   |
| States and political subdivisions             |   |      | 45,875,748  |   |       |   | 1,595,493  |       |   |   | 503,787   |   |   |   | 46,967,454 |   |
| Corporate                                     |   |      | 144,524,072 |   |       |   | 8,937,805  |       |   |   | 536,523   |   |   |   | 152,925,354 |   |
| Foreign                                       |   |      | 21,299,977  |   |       |   | 2,043,203  |       |   |   | 108,000   |   |   |   | 23,235,180 |   |
| Asset-backed securities                       |   |      | 5,337,544   |   |       |   | 429,540    |       |   |   | -         |   |   |   | 5,767,084 |   |
| Mortgage-backed securities (MBS):             |   |      |        |   |       |   |       |       |   |   |      |   |   |   |   |   |
|   Commercial MBS                    |   |      | 8,812,957   |   |       |   | 363,055    |       |   |   | -         |   |   |   | 9,176,012 |   |
|   Residential MBS                   |   |      | 37,745,839  |   |       |   | 2,469,845  |       |   |   | 64,600    |   |   |   | 40,151,084 |   |
| Total fixed maturity securities               |   |      | 298,767,885 |   |       |   | 17,520,651 |       |   |   | 1,219,319 |   |   |   | 315,069,217 |   |
| Equity securities:                            |   |      |        |   |       |   |       |       |   |   |      |   |   |   |   |   |
|   U.S. agencies                     |   |      | 552,800     |   |       |   | -          |       |   |   | -         |   |   |   | 552,800 |   |
|   Mutual funds                      |   |      | 2,106,380   |   |       |   | 625,169    |       |   |   | -         |   |   |   | 2,731,549 |   |
|   Nonredeemable corporate preferred |   |      | 990,000     |   |       |   | -          |       |   |   | 18,440    |   |   |   | 971,560 |   |
|   Corporate common stock            |   |      | 228,595     |   |       |   | 284,005    |       |   |   | -         |   |   |   | 512,600 |   |
| Total equity securities                       |   |      | 3,877,775   |   |       |   | 909,174    |       |   |   | 18,440    |   |   |   | 4,768,509 |   |
| Total                                         |   | $         | 302,645,660 |   |       | $      | 18,429,825 |       |   | $      | 1,237,759 |   |   | $ | 319,837,726 |   |
|                                          |   |      |        |   |       |   |       |       |   |   |      |   |   |   |   |   |
|                                          |   |      |        |   |       | Gross  |       |       | Gross  |   |      |   |   |   |
| December 31, 2010                             |   | Amortized |        |   | Unrealized |   |       | Unrealized |   |   | Fair      |   |
|                                          |   | Cost      |        |   | Gains      |   |       | Losses     |   |   | Value     |   |
| Fixed maturity securities:                    |   |      |        |   |       |   |       |       |   |   |      |   |   |   |   |   |
| U.S. government obligations                   |   | $         | 36,241,751  |   |       | $      | 2,039,206  |       |   | $      | 459       |   |   | $ | 38,280,498 |   |
| States and political subdivisions             |   |      | 46,017,006  |   |       |   | 1,586,463  |       |   |   | 560,751   |   |   |   | 47,042,718 |   |
| Corporate                                     |   |      | 141,595,890 |   |       |   | 9,591,286  |       |   |   | 513,357   |   |   |   | 150,673,819 |   |
| Foreign                                       |   |      | 20,326,137  |   |       |   | 2,331,581  |       |   |   | 128,818   |   |   |   | 22,528,900 |   |
| Asset-backed securities                       |   |      | 5,719,748   |   |       |   | 477,989    |       |   |   | 1,533     |   |   |   | 6,196,204 |   |
| Mortgage-backed securities (MBS):             |   |      |        |   |       |   |       |       |   |   |      |   |   |   |   |   |
|   Commercial MBS                    |   |      | 8,061,043   |   |       |   | 363,836    |       |   |   | -         |   |   |   | 8,424,879 |   |
|   Residential MBS                   |   |      | 37,627,514  |   |       |   | 2,731,312  |       |   |   | 49,582    |   |   |   | 40,309,244 |   |
| Total fixed maturity securities               |   |      | 295,589,089 |   |       |   | 19,121,673 |       |   |   | 1,254,500 |   |   |   | 313,456,262 |   |
| Equity securities:                            |   |      |        |   |       |   |       |       |   |   |      |   |   |   |   |   |
|   U.S. agencies                     |   |      | 552,800     |   |       |   | -          |       |   |   | -         |   |   |   | 552,800 |   |
|   Mutual funds                      |   |      | 2,106,380   |   |       |   | 472,991    |       |   |   | 8,146     |   |   |   | 2,571,225 |   |
|   Nonredeemable corporate preferred |   |      | 990,000     |   |       |   | -          |       |   |   | 42,810    |   |   |   | 947,190 |   |
|   Corporate common stock            |   |      | 228,595     |   |       |   | 226,533    |       |   |   | 1,572     |   |   |   | 453,556 |   |
| Total equity securities                       |   |      | 3,877,775   |   |       |   | 699,524    |       |   |   | 52,528    |   |   |   | 4,524,771 |   |
| Total                                         |   | $         | 299,466,864 |   |       | $      | 19,821,197 |       |   | $      | 1,307,028 |   |   | $ | 317,981,033 |   |

----

|                                                |   | March 31, 2011 |       |   | December 31, 2010 |   |
|-----------------------------------------------------|--------|----------------|------------|--------|-------------------|--------|
|                                                |   |           |       |   | Gross             |   |   | Number |   |   |   |   |   | Gross |   |   | Number |   |
|                                                |   | Estimated      |       |   | Unrealized        |   |   | of |   |   | Estimated |   |   | Unrealized |   |   | of |   |
|                                                |   | Fair Value     |       |   | Loss              |   |   | Securities |   |   | Fair Value |   |   | Loss |   |   | Securities |   |
| Fixed Maturities:                                   |   |           |       |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Less than 12 months:                                |   |           |       |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    U.S. government obligations       |   | $              | 1,131,517  |   |              | $      | 6,409 |   |   |   | 3 |   |   | $ | 155,391 |   |   | $ | 459 |   |   |   | 2 |   |
|    States and political subdivisions |   |           | 12,890,197 |   |              |   | 503,787 |   |   |   | 18 |   |   |   | 15,633,403 |   |   |   | 560,751 |   |   |   | 21 |   |
|    Corporate                         |   |           | 22,559,333 |   |              |   | 536,523 |   |   |   | 20 |   |   |   | 14,585,855 |   |   |   | 438,252 |   |   |   | 11 |   |
|    Asset-backed securities           |   |           | -          |   |              |   | - |   |   |   | - |   |   |   | 446,468 |   |   |   | 1,533 |   |   |   | 2 |   |
|    Residential MBS                   |   |           | 4,634,932  |   |              |   | 64,600 |   |   |   | 3 |   |   |   | 2,784,372 |   |   |   | 49,582 |   |   |   | 2 |   |
| Greater than 12 months:                             |   |           |       |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Corporate                         |   |           | -          |   |              |   | - |   |   |   | - |   |   |   | 1,926,720 |   |   |   | 75,105 |   |   |   | 2 |   |
|    Foreign                           |   |           | 868,140    |   |              |   | 108,000 |   |   |   | 1 |   |   |   | 846,630 |   |   |   | 128,818 |   |   |   | 1 |   |
| Total fixed maturities                              |   |           | 42,084,119 |   |              |   | 1,219,319 |   |   |   | 45 |   |   |   | 36,378,839 |   |   |   | 1,254,500 |   |   |   | 41 |   |
|                                                |   |           |       |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equities:                                           |   |           |       |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Less than 12 months:                                |   |           |       |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Mutual funds                      |   |           | -          |   |              |   | - |   |   |   | - |   |   |   | 310,138 |   |   |   | 8,146 |   |   |   | 1 |   |
|    Nonredeemable corporate preferred |   |           | 971,560    |   |              |   | 18,440 |   |   |   | 1 |   |   |   | 947,190 |   |   |   | 42,810 |   |   |   | 1 |   |
|    Corporate common stock            |   |           | -          |   |              |   | - |   |   |   | - |   |   |   | 109,556 |   |   |   | 1,572 |   |   |   | 1 |   |
| Total equities                                      |   |           | 971,560    |   |              |   | 18,440 |   |   |   | 1 |   |   |   | 1,366,884 |   |   |   | 52,528 |   |   |   | 3 |   |
|                                                |   |           |       |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                               |   | $              | 43,055,679 |   |              | $      | 1,237,759 |   |   |   | 46 |   |   | $ | 37,745,723 |   |   | $ | 1,307,028 |   |   |   | 44 |   |

----

|                                                 |   | March 31, |       |   | December 31, |   |
|------------------------------------------------------|--------|-----------|------------|--------|--------------|--------|
|                                                 |   | 2011      |       |   | 2010         |   |
| Net unrealized appreciation on                       |   |      |       |   |         |   |
|   available-for sale securities            |   | $         | 17,192,066 |   |         | $      | 18,514,169 |   |
|   Adjustment to deferred acquisition costs |   |      | (702,106   | )      |         |   | (763,222 | ) |
|   Deferred income taxes                    |   |      | (5,832,015 | )      |         |   | (6,279,267 | ) |
| Net unrealized appreciation on                       |   |      |       |   |         |   |   |   |
|   available-for sale securities            |   | $         | 10,657,945 |   |         | $      | 11,471,680 |   |

|                                   |   | Available-for-Sale |        |
|----------------------------------------|--------|--------------------|-------------|
|                                   |   | Amortized          |        |   | Fair |   |
|                                   |   | Cost               |        |   | Value |   |
| Due in one year or less                |   | $                  | 18,124,146  |   |   | $ | 18,667,488 |   |
| Due after one year through five years  |   |               | 74,444,518  |   |   |   | 79,425,376 |   |
| Due after five years through ten years |   |               | 90,029,560  |   |   |   | 96,179,608 |   |
| Due after ten years                    |   |               | 69,610,865  |   |   |   | 71,469,649 |   |
| Due at multiple maturity dates         |   |               | 46,558,796  |   |   |   | 49,327,096 |   |
| Total                                  |   | $                  | 298,767,885 |   |   | $ | 315,069,217 |   |

----

|                                |   | Quarter Ended March 31, |       |
|-------------------------------------|--------|-------------------------|------------|
|                                |   | 2011                    |       |   | 2010 |   |
| Change in unrealized investment     |   |                    |       |   |   |   |
|    gains (losses):   |   |                    |       |   |   |   |
|   Available-for-sale:     |   |                    |       |   |   |   |
|   Fixed maturities        |   | $                       | (1,565,841 | ) |   | $ | 3,373,648 |   |
|   Equity securities       |   |                    | 243,738    |   |   |   | 132,592 |   |
| Realized investment gains (losses): |   |                    |       |   |   |   |   |   |
|   Available-for-sale:     |   |                    |       |   |   |   |   |   |
|   Fixed maturities        |   | $                       | (5,989     | ) |   | $ | 72,811 |   |
|   Equity securities       |   |                    | -          |   |   |   | - |   |

|                          |   | Quarter Ended March 31, |      |
|-------------------------------|--------|-------------------------|-----------|
|                          |   | 2011                    |      |   | 2010 |   |
| Fixed maturities              |   | $                       | 3,948,905 |   |   | $ | 3,926,945 |   |
| Mortgage loans on real estate |   |                    | 326,447   |   |   |   | 377,554 |   |
| Other                         |   |                    | 190,424   |   |   |   | 185,872 |   |
|                          |   |                    | 4,465,776 |   |   |   | 4,490,371 |   |
| Investment expenses           |   |                    | 239,182   |   |   |   | 226,801 |   |
|                          |   | $                       | 4,226,594 |   |   | $ | 4,263,570 |   |

----

----

|                              |   | March 31, 2011    |      |
|-----------------------------------|--------|-------------------|-----------|
|                              |   | Level 1           |      |   | Level 2 |   |   | Level 3 |   |   | Total |   |
| Fixed maturities:                 |   |              |      |   |   |   |   |   |   |   |   |   |
| U.S. government obligations       |   | $                 | -         |   |   | $ | 36,847,049 |   |   | $ | - |   |   | $ | 36,847,049 |   |
| States and political subdivisions |   |              | -         |   |   |   | 46,967,454 |   |   |   | - |   |   |   | 46,967,454 |   |
| Corporate                         |   |              | -         |   |   |   | 150,822,699 |   |   |   | 2,102,655 |   |   |   | 152,925,354 |   |
| Foreign                           |   |              | -         |   |   |   | 23,235,180 |   |   |   | - |   |   |   | 23,235,180 |   |
| Asset-backed securities           |   |              | -         |   |   |   | 5,767,084 |   |   |   | - |   |   |   | 5,767,084 |   |
| Mortgage-backed securities:       |   |              |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Commercial MBS  |   |              | -         |   |   |   | 9,176,012 |   |   |   | - |   |   |   | 9,176,012 |   |
|    Residential MBS |   |              | -         |   |   |   | 40,151,084 |   |   |   | - |   |   |   | 40,151,084 |   |
| Total fixed maturities            |   | $                 | -         |   |   | $ | 312,966,562 |   |   | $ | 2,102,655 |   |   | $ | 315,069,217 |   |
|                              |   |              |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equity securities:                |   |              |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. agencies                     |   | $                 | 552,800   |   |   | $ | - |   |   | $ | - |   |   | $ | 552,800 |   |
| Mutual funds                      |   |              | 2,731,549 |   |   |   | - |   |   |   | - |   |   |   | 2,731,549 |   |
| Nonredeemable corporate preferred |   |              | -         |   |   |   | 971,560 |   |   |   | - |   |   |   | 971,560 |   |
| Corporate common stock            |   |              | 168,600   |   |   |   | - |   |   |   | 344,000 |   |   |   | 512,600 |   |
| Total equity securities           |   | $                 | 3,452,949 |   |   | $ | 971,560 |   |   | $ | 344,000 |   |   | $ | 4,768,509 |   |
|                              |   |              |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                              |   | December 31, 2010 |      |
|                              |   | Level 1           |      |   | Level 2 |   |   | Level 3 |   |   | Total |   |
| Fixed maturities:                 |   |              |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. government obligations       |   | $                 | -         |   |   | $ | 38,280,498 |   |   | $ | - |   |   | $ | 38,280,498 |   |
| States and political subdivisions |   |              | -         |   |   |   | 47,042,718 |   |   |   | - |   |   |   | 47,042,718 |   |
| Corporate                         |   |              | -         |   |   |   | 150,673,819 |   |   |   | - |   |   |   | 150,673,819 |   |
| Foreign                           |   |              | -         |   |   |   | 22,528,900 |   |   |   | - |   |   |   | 22,528,900 |   |
| Asset-backed securities           |   |              | -         |   |   |   | 5,808,341 |   |   |   | 387,863 |   |   |   | 6,196,204 |   |
| Mortgage-backed securities:       |   |              |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Commercial MBS  |   |              | -         |   |   |   | 8,424,879 |   |   |   | - |   |   |   | 8,424,879 |   |
|    Residential MBS |   |              | -         |   |   |   | 40,309,244 |   |   |   | - |   |   |   | 40,309,244 |   |
| Total fixed maturities            |   | $                 | -         |   |   | $ | 313,068,399 |   |   | $ | 387,863 |   |   | $ | 313,456,262 |   |
|                              |   |              |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equity securities:                |   |              |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. agencies                     |   | $                 | 552,800   |   |   | $ | - |   |   | $ | - |   |   | $ | 552,800 |   |
| Mutual funds                      |   |              | 2,571,225 |   |   |   | - |   |   |   | - |   |   |   | 2,571,225 |   |
| Nonredeemable corporate preferred |   |              | -         |   |   |   | 947,190 |   |   |   | - |   |   |   | 947,190 |   |
| Corporate common stock            |   |              | 109,556   |   |   |   | - |   |   |   | 344,000 |   |   |   | 453,556 |   |
| Total equity securities           |   | $                 | 3,233,581 |   |   | $ | 947,190 |   |   | $ | 344,000 |   |   | $ | 4,524,771 |   |

----

|                             |   | Quarter Ended March 31, 2011 |     |
|----------------------------------|--------|------------------------------|----------|
|                             |   | U.S.                         |     |   |   |   |   | Asset- |   |   | Corporate |   |   |   |   |
|                             |   | Government                   |     |   |   |   |   | Backed |   |   | Common |   |   |   |   |
|                             |   | Obligations                  |     |   | Corporate |   |   | Securities |   |   | Stock |   |   | Total |   |
| Beginning balance                |   | $                            | -        |   |   | $ | - |   |   | $ | 387,863 |   |   | $ | 344,000 |   |   | $ | 731,863 |   |
| Transfers into Level 3           |   |                         | -        |   |   |   | 1,701,785 |   |   |   | - |   |   |   | - |   |   |   | 1,701,785 |   |
| Transfers out of Level 3         |   |                         | -        |   |   |   | - |   |   |   | (387,863 | ) |   |   | - |   |   |   | (387,863 | ) |
| Total gains or losses:           |   |                         |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | - |   |
| Included in earnings             |   |                         | -        |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Included in other                |   |                         |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   comprehensive income |   |                         | -        |   |   |   | 34,534 |   |   |   | - |   |   |   | - |   |   |   | 34,534 |   |
| Purchases                        |   |                         | -        |   |   |   | 400,000 |   |   |   | - |   |   |   | - |   |   |   | 400,000 |   |
| Sales                            |   |                         | -        |   |   |   | (33,664 | ) |   |   | - |   |   |   | - |   |   |   | (33,664 | ) |
| Ending balance                   |   | $                            | -        |   |   | $ | 2,102,655 |   |   | $ | - |   |   | $ | 344,000 |   |   | $ | 2,446,655 |   |
|                             |   |                         |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                             |   |                         |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                             |   | Quarter Ended March 31, 2010 |     |
|                             |   | U.S.                         |     |   |   |   |   |   | Asset- |   |   | Corporate |   |   |   |   |   |
|                             |   | Government                   |     |   |   |   |   |   | Backed |   |   | Common |   |   |   |   |   |
|                             |   | Obligations                  |     |   | Corporate |   |   | Securities |   |   | Stock |   |   | Total |   |
| Beginning balance                |   | $                            | 775,000  |   |   | $ | 4,573,606 |   |   | $ | 436,855 |   |   | $ | 342,400 |   |   | $ | 6,127,861 |   |
| Transfers into Level 3           |   |                         | -        |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Transfers out of Level 3         |   |                         | (787,793 | ) |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (787,793 | ) |
| Total gains or losses:           |   |                         |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | - |   |
| Included in earnings             |   |                         | -        |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Included in other                |   |                         |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   comprehensive income |   |                         | 12,793   |   |   |   | 109,658 |   |   |   | 11,723 |   |   |   | 1,600 |   |   |   | 135,774 |   |
| Net purchases (sales)            |   |                         | -        |   |   |   | (111,952 | ) |   |   | (37,501 | ) |   |   | - |   |   |   | (149,453 | ) |
| Ending balance                   |   | $                            | -        |   |   | $ | 4,571,312 |   |   | $ | 411,077 |   |   | $ | 344,000 |   |   | $ | 5,326,389 |   |

----

|                                                |   | March 31, 2011 |        |   | December 31, 2010 |   |
|-----------------------------------------------------|--------|----------------|-------------|--------|-------------------|--------|
|                                                |   | Carrying       |        |   | Fair              |   |   | Carrying |   |   | Fair |   |
|                                                |   | Amount         |        |   | Value             |   |   | Amount |   |   | Value |   |
| Assets:                                             |   |           |        |   |              |   |   |   |   |   |   |   |
|   Fixed maturities                        |   | $              | 315,069,217 |   |              | $      | 315,069,217 |   |   | $ | 313,456,262 |   |   | $ | 313,456,262 |   |
|   Equity securities                       |   |           | 4,768,509   |   |              |   | 4,768,509 |   |   |   | 4,524,771 |   |   |   | 4,524,771 |   |
|   Mortgage loans on real estate:          |   |           |        |   |              |   |   |   |   |   |   |   |   |   |   |   |
|     Commercial                  |   |           | 18,941,680  |   |              |   | 19,536,301 |   |   |   | 19,792,428 |   |   |   | 20,524,312 |   |
|     Residential                 |   |           | 24,027      |   |              |   | 25,237 |   |   |   | 25,050 |   |   |   | 26,498 |   |
|   Policy loans                            |   |           | 6,908,128   |   |              |   | 6,908,128 |   |   |   | 6,949,374 |   |   |   | 6,949,374 |   |
|   Other long-term investments             |   |           | 1,385,526   |   |              |   | 1,385,526 |   |   |   | 1,454,232 |   |   |   | 1,454,232 |   |
|   Short-term investments                  |   |           | -           |   |              |   | - |   |   |   | 491,041 |   |   |   | 491,041 |   |
|   Cash and cash equivalents               |   |           | 1,622,226   |   |              |   | 1,622,226 |   |   |   | 2,647,798 |   |   |   | 2,647,798 |   |
|   Accrued investment income               |   |           | 3,745,025   |   |              |   | 3,745,025 |   |   |   | 3,926,591 |   |   |   | 3,926,591 |   |
|   Cash value of company-owned             |   |           |        |   |              |   |   |   |   |   |   |   |   |   |   |   |
|      life insurance        |   |           | 9,062,010   |   |              |   | 9,062,010 |   |   |   | 9,021,432 |   |   |   | 9,021,432 |   |
|                                                |   |           |        |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities:                                        |   |           |        |   |              |   |   |   |   |   |   |   |   |   |   |   |
|   Policyholder deposits                   |   |           |        |   |              |   |   |   |   |   |   |   |   |   |   |   |
|     (Investment-type contracts) |   | $              | 54,168,175  |   |              | $      | 51,691,455 |   |   | $ | 54,276,322 |   |   | $ | 52,169,944 |   |
|   Policy claims                           |   |           | 1,759,918   |   |              |   | 1,759,918 |   |   |   | 1,887,136 |   |   |   | 1,887,136 |   |
|   Obligations under capital leases        |   |           | 47,793      |   |              |   | 47,793 |   |   |   | 57,808 |   |   |   | 57,808 |   |
|   Notes payable                           |   |           | 1,746,880   |   |              |   | 1,801,806 |   |   |   | 2,533,955 |   |   |   | 2,489,222 |   |

----

|                                                |   | Quarter Ended March 31, |       |
|-----------------------------------------------------|--------|-------------------------|------------|
|                                                |   | 2011                    |       |   | 2010 |   |
|                                                |   |                    |       |   |   |   |
| Revenue:                                            |   |                    |       |   |   |   |
|   Preneed and burial products             |   | $                       | 10,721,442 |   |   | $ | 9,569,040 |   |
|   Traditional and universal life products |   |                    | 2,696,066  |   |   |   | 2,549,485 |   |
|   Administrative and financial services   |   |                    | 361,807    |   |   |   | 258,325 |   |
|   Corporate and other                     |   |                    | 174,277    |   |   |   | 181,853 |   |
|                                                |   | $                       | 13,953,592 |   |   | $ | 12,558,703 |   |
|                                                |   |                    |       |   |   |   |   |   |
| Pre-tax income (loss) from operations:              |   |                    |       |   |   |   |   |   |
|   Preneed and burial products             |   | $                       | (297,054   | ) |   | $ | (265,893 | ) |
|   Traditional and universal life products |   |                    | 238,739    |   |   |   | (214,144 | ) |
|   Administrative and financial services   |   |                    | 55,588     |   |   |   | 41,945 |   |
|   Corporate and other                     |   |                    | 60,881     |   |   |   | (103,613 | ) |
|                                                |   | $                       | 58,154     |   |   | $ | (541,705 | ) |

----

|                                         |   | Quarter Ended March 31, |     |
|----------------------------------------------|--------|-------------------------|----------|
|                                         |   | 2011                    |     |   | 2010 |   |
|                                         |   |                    |     |   |   |   |
| Total net unrealized gains (losses)          |   |                    |     |   |   |   |
|    arising during the period  |   | $                       | (819,724 | ) |   | $ | 2,322,861 |   |
| Less: Net realized investment gains (losses) |   |                    | (5,989   | ) |   |   | 72,811 |   |
| Net unrealized gains (losses)                |   |                    | (813,735 | ) |   |   | 2,250,050 |   |
| Change in unrealized pension benefits        |   |                    | 86,634   |   |   |   | 64,586 |   |
| Change in fair value of hedging instrument   |   |                    | -        |   |   |   | 2,358 |   |
| Net income (loss)                            |   |                    | 40,343   |   |   |   | (394,144 | ) |
| Total comprehensive income (loss)            |   | $                       | (686,758 | ) |   | $ | 1,922,850 |   |

|                           |   | Quarter Ended March 31, |     |
|--------------------------------|--------|-------------------------|----------|
|                           |   | 2011                    |     |   | 2010 |   |
|                           |   |                    |     |   |   |   |
| Service cost                   |   | $                       | 130,194  |   |   | $ | 94,571 |   |
| Interest cost                  |   |                    | 252,986  |   |   |   | 237,615 |   |
| Expected return on plan assets |   |                    | (285,862 | ) |   |   | (241,865 | ) |
| Recognized net loss            |   |                    | 131,264  |   |   |   | 97,858 |   |
| Net periodic benefit cost      |   | $                       | 228,582  |   |   | $ | 188,179 |   |

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| 31.1 & 31.2   | Certifications pursuant to Securities and Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of  2002. |
|----------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                             |                                                                                                                                                         |
| 32.1                        | Certifications Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                     |

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|                          | INVESTORS HERITAGE CAPITAL CORPORATION   |
|-------------------------------|------------------------------------------|
|                          |                                     |
|                          | BY: /s/Harry Lee Waterfield II      |
|                          | Harry Lee Waterfield II                  |
| DATE: May 12, 2011            | President                                |
|                          |                                     |
|                          | BY: /s/Raymond L. Carr              |
|                          | Raymond L. Carr                          |
| DATE:  May 12, 2011 | Vice President - Chief Financial Officer |