Financial Performance - Total assets reached $1.7 billion, with total investments of $1.4 billion, and fixed maturity securities comprised 88% of total investments [123]. - Net income before federal income taxes decreased to $3.3 million for the three months ended June 30, 2024, down from $6.0 million in the same period of 2023 [121]. - Total revenues increased to $62,084,000 for the three months ended June 30, 2024, up from $58,527,000 in the prior year, and $119,796,000 for the six months ended June 30, 2024, compared to $114,441,000 [128]. - The company reported a net income per share of Class A common stock of $0.08 and $0.17 for the three and six months ended June 30, 2024, respectively [123]. - Total income before federal income tax for the three months ended June 30, 2024, was $3.3 million, a decrease from $6.0 million in the same period of 2023 [143]. Insurance Segment Performance - First year premiums in the Life Insurance segment more than doubled quarter-over-quarter and almost doubled year-to-date compared to 2023 [113]. - Total insurance issued increased by 73% in the six months ended June 30, 2024, compared to the prior year period, driven by new products and expanded distribution channels [125]. - Life Insurance segment growth driven by strong sales of new domestic final expense products, accounting for over 50% of insurance issued through June 30, 2024 [126]. - Life Insurance segment premiums increased by 10% to $31.6 million for the three months ended June 30, 2024, compared to $28.8 million in 2023, driven by a 103% increase in first-year premiums [146]. - International whole life product sales represented 65% of total insurance issued internationally in the Life Insurance segment for the six months ended June 30, 2024 [126]. Investment Income - Net investment income increased by 2% for both the three and six months ended June 30, 2024, reaching $18 million and $36 million respectively [117]. - Net investment income for the three months ended June 30, 2024, was $17,540,000, compared to $17,241,000 in the prior year, and $35,027,000 for the six months ended June 30, 2024, compared to $34,315,000 [131]. - Net investment income rose by 2% to $13.8 million for the three months ended June 30, 2024, compared to $13.5 million in the same period of 2023 [149]. Claims and Benefits - Claims and surrenders expenses included a $1.8 million increase in benefits paid due to higher matured endowments reaching their contractual maturity dates [121]. - Total insurance benefits paid increased to $36,029,000 for the three months ended June 30, 2024, from $34,049,000 in the prior year, and $71,149,000 for the six months ended June 30, 2024, compared to $65,358,000 [133]. - Claims and surrenders totaled $34,530,000 for the three months ended June 30, 2024, compared to $32,776,000 in the prior year, and $67,643,000 for the six months ended June 30, 2024, compared to $63,075,000 [134]. - Death benefit payments increased in the first half of 2024 due to a significant rise in insurance issued, while surrender benefits slightly decreased [180]. - The company reported a decrease in death claim benefits to $1.2 million for the three months ended June 30, 2024, from $1.4 million in 2023 [151]. Operating Expenses - Operating expenses increased due to the accrual of $3.5 million in legal fees related to a trade secret lawsuit [119]. - The company experienced a slight decline in renewal premiums for the six months ended June 30, 2024, due to high surrenders and matured endowments [146]. Reinsurance and Risk Management - The company entered into a coinsurance agreement with RGA Reinsurance Company to reinsure 50% of its newly written final expense business [113]. - Reinsurance ceded premiums increased due to a new coinsurance agreement with RGA entered in the second quarter of 2024 [130]. - The company is closely monitoring policyholder behavior patterns to manage liquidity risks associated with commission advances and policy surrenders [182]. Capital and Liquidity - The company has no debt as of June 30, 2024, and liquidity is primarily derived from cash flow from operations and marketable securities [172]. - The company renewed its Credit Facility with Regions Bank on May 3, 2024, providing additional liquidity for short-term or long-term needs [176]. - Citizens may need to contribute capital to CICA Domestic to maintain the required RBC ratio if growth exceeds current resources, impacting overall liquidity [185]. - Approximately 18% of endowments, representing about 6% of in-force business, are set to mature within the next five years, posing potential liquidity risks if policyholders opt for lump sum distributions [181]. Investment Portfolio - The carrying value of fixed maturity securities was $1.21 billion as of June 30, 2024, down from $1.24 billion at December 31, 2023, indicating a slight reduction in investment portfolio size [161]. - Cash and cash equivalents decreased to $26.34 million as of June 30, 2024, from $26.99 million at December 31, 2023, reflecting fluctuations due to operating and investing activities [162]. - Other long-term investments increased by $9.4 million as of June 30, 2024, attributed to additional funding and increases in fair market value of limited partnership investments [162]. - The Company’s municipal bond portfolio included $277.2 million in obligations of states and political subdivisions as of June 30, 2024, down from $287.2 million at December 31, 2023 [163]. - The total fair value of the company's municipal bonds in Texas was $61,564,000, while in California it was $42,406,000 as of June 30, 2024 [168][169].

Revenue and Growth - Insurance issued increased 61% to $274.5 million in Q1 2024 compared to the same period in 2023, driven by new products and an increase in producing agents[4] - Total revenues increased 3% to $57.7 million in Q1 2024, up from $55.9 million in the year-ago quarter[5] - First year life and A&H premiums increased 42% to $5.9 million in Q1 2024, marking the sixth consecutive quarter of year-over-year growth[4] - The global network of producing agents increased by 20% at the end of Q1 2024 compared to December 31, 2023[4] - Citizens plans to introduce 2 to 3 new products or major product enhancements in 2024[4] Financial Performance - Net income for Q1 2024 was $4.5 million, or $0.09 per fully diluted Class A share, down from $4.9 million, or $0.10 per share in Q1 2023[7] - Cash and cash equivalents stood at $23.2 million with no debt as of March 31, 2024[10] - Book value per Class A share increased 28% to $3.94 compared to the year-ago quarter[4] - Positive net cash provided by operating activities was $6.8 million in Q1 2024, continuing a trend of positive cash flow since 2004[10] Investment Performance - The average pre-tax yield on the investment portfolio was 4.6% in Q1 2024, an increase of 9 basis points from the prior year[8]

Premium revenues consist of all money deposited by customers into new and existing insurance policies. We believe sales statistics are meaningful to gaining an understanding of, among other things, the attractiveness of our new products, how expansion of our distribution channels affects our revenue, customer retention and the performance of our business from period-to-period. Throughout the MD&A, we describe the actions and initiatives that we are taking to increase sales and improve retention, sales perfo ...

Citizens, Inc. Reports Fourth Quarter and Full Year 2023 Financial Results "We achieved another quarter of significant progress on our strategic roadmap, designed to deliver sustainable increased book value per share and enhanced operating results, and that progress has continued into 2024. The quarter capped a year of customers in large and underserved markets embracing our innovative new products on their path toward financial security. First year premiums have increased year-over-year for five consecutiv ...

• USA Patriot Act and the Bank Secrecy Act, which require us to institute certain measures to detect and prevent money laundering; • Foreign Corrupt Practices Act, which makes it unlawful to bribe foreign officials for the purpose of obtaining or retaining business; • Gramm-Leach-Bliley Act, which requires us to explain our information-sharing practices to our customers and to safeguard sensitive data; • Securities Act, Securities Exchange Act and Sarbanes-Oxley Act, which establish various requirements for ...

Emerging Growth Virtual Conference on March 6, 2024Singular Research "Spring Select" Virtual Conference on May 22, 2024Austin, Texas--(Newsfile Corp. - March 5, 2024) - Citizens, Inc. (NYSE: CIA), a leading diversified financial services company specializing in life, living benefits, and final expense insurance, today announced management's plan for participation in upcoming investor conferences.Emerging Growth Virtual Conference on March 6, 2024Citizens plans to present at the Emerging Growth Virtual Conf ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended September 30, 2023 OR ☐ 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: 000-16509 CITIZENS, INC. (Exact name of registrant as specified in its charter) Colorado 84-0755371 (State or other jurisdiction of incorp ...

The Company's municipal bond portfolio includes third-party guarantees. Detailed below is a presentation by the Nationally Recognized Statistical Rating Organization ("NRSRO") rating of these holdings by funding type as of June 30, 2023. The Company's municipal bond portfolio is spread across many states, however, municipal bonds from Texas and California comprise the most significant concentration of the total municipal bond portfolio as of June 30, 2023. The Company holds 22% and 14% of its municipal bond ...

Revenue and Premiums - Total revenues for the three months ended March 31, 2023, were $55.914 million, a slight increase from $55.357 million in the same period of 2022[136] - Life insurance premiums decreased by 2.7% to $26.207 million for the three months ended March 31, 2023, compared to $26.931 million in the prior year, primarily due to lower renewal premiums[149] - First-year premiums in the Life Insurance segment increased by 30.5% to $2.594 million for the three months ended March 31, 2023, driven by sales campaigns and a new international whole life product[149] - The Home Service Insurance segment experienced a 3.1% decline in total premium revenue for the three months ended March 31, 2023, despite a 15.1% increase in first-year premiums[159] - Total revenues for the three months ended March 31, 2023, were $15.611 million, an increase from $15.435 million in the same period of 2022, representing a growth of 1.14%[172] Investment Income and Assets - Net investment income rose to $17.074 million for the three months ended March 31, 2023, compared to $15.487 million in the same period of 2022, reflecting a 10.3% increase[137] - The annualized yield on average invested assets increased to 4.50% for the three months ended March 31, 2023, up from 4.20% in the prior year[138] - Net investment income increased by 11.2% to $3.470 million for the three months ended March 31, 2023, compared to $3.244 million in the prior year[167] - The carrying value of fixed maturity securities increased to $1.230 billion as of March 31, 2023, compared to $1.179 billion at December 31, 2022, reflecting a growth of 4.32%[176] - The Company’s total cash, cash equivalents, and invested assets reached $1.413 billion as of March 31, 2023, with 87.0% invested in fixed maturity securities[184] - Other long-term investments increased by $2.7 million as of March 31, 2023, due to additional funding of limited partnership investments[177] - Fixed maturity securities increased to $1,229.69 million as of March 31, 2023, from $1,179.62 million as of December 31, 2022[193] - The company holds 21.7% of its municipal bond portfolio in Texas and 14.3% in California as of March 31, 2023[189] - The municipal bond portfolio includes significant investments in Education ($48.49 million, 15.7% of total fair value) and Utilities ($46.42 million, 15.0% of total fair value) as of March 31, 2023[189] - The company did not record any credit valuation allowances on fixed maturity securities for the three months ended March 31, 2023, or 2022[207] Claims and Benefits - Total claims and surrenders increased to $30.299 million for the three months ended March 31, 2023, compared to $28.434 million in the same period of 2022[132] - Death claim benefits decreased by 23.3% to $748,000 for the three months ended March 31, 2023, compared to $990,000 in the prior year, due to a lower volume of reported claims[143] - Claims and surrenders in the Life Insurance segment decreased to $5.860 million for the three months ended March 31, 2023, down from $6.976 million in the same period of 2022, a reduction of 15.99%[172] - Total insurance benefits paid or provided increased to $6.773 million for the three months ended March 31, 2023, compared to $5.971 million in the same period of 2022, an increase of 13.45%[172] Income and Operations - The Life Insurance segment reported income before federal income tax of $6.372 million for the three months ended March 31, 2023, compared to $5.864 million in the prior year[147] - Income before federal income tax in the Home Service Insurance segment was $1.3 million for the three months ended March 31, 2023, down from $2.1 million in the prior year period[212] - The company reported a net cash of $7.4 million from operations for the three months ended March 31, 2023[209] Financial Position and Future Outlook - The Company’s cash and cash equivalents decreased to $18.924 million as of March 31, 2023, from $22.973 million at December 31, 2022, a decline of 17.83%[176] - The change in future policy benefit reserves decreased due to reserves released from higher matured endowment benefits[199] - The company anticipates meeting its short-term and long-term cash needs primarily through cash generated by its insurance operations and invested assets[209] - The company may raise capital through its Stock Investment Plan (SIP) and access its Credit Facility if needed[209]

Insurance Operations and Market Environment - Approximately 69% of direct insurance premiums are generated from policyholders in foreign countries, primarily in Latin America and the Pacific Rim [153]. - The company faces significant competition in international markets, which may adversely affect business and profitability [187]. - Regulatory risks include the need for licenses or approvals in foreign countries, which could disrupt sales and impact premium revenue [153][184]. - Political instability in operating countries could affect policyholder premium payments and new product sales [157]. - The ongoing COVID-19 pandemic has led to increased claims and decreased premium revenue, with potential long-term effects on pricing assumptions and underwriting risks [228]. - Insurance laws may prioritize policyholders' interests over shareholders' interests, potentially complicating mergers or acquisitions [258]. Financial Performance and Risks - The company's overall financial performance primarily depends on the pricing of its insurance products and the accuracy of its pricing assumptions [192]. - The company's largest expense is payments of claims and surrenders to policyholders, with mismanagement potentially impacting financial condition [164]. - The company must accurately underwrite and set premiums to cover costs and earn profits, which is subject to various risks and uncertainties [161]. - Rising interest rates may reduce the market values of fixed income assets, leading to unrealized losses and negatively affecting stockholder equity [219]. - The company may experience liquidity risks if policyholders with mature policies elect to receive lump sum distributions at greater levels than anticipated [226]. - Unanticipated increases in early policyholder withdrawals or surrenders could negatively impact liquidity [194]. - The company may need to sell investments or seek third-party financing if cash flow from insurance operations is insufficient to meet benefit payments [195]. - Market volatility and changes in interest rates could adversely affect investment income, which is a significant portion of total revenues, potentially impacting overall financial condition [247]. - The company is exposed to credit risk in its investment portfolio, with potential defaults or downgrades leading to reduced investment income and recognition of losses [248]. Regulatory and Compliance Issues - The company is subject to extensive regulation and supervision in the jurisdictions where it operates, which may affect its operations and financial condition [214]. - Citizens, Inc. is subject to minimum capital and surplus requirements across its insurance subsidiaries, and failure to meet these could lead to regulatory actions that adversely impact competitiveness and financial condition [239]. - The company has implemented an enhanced anti-money laundering and sanctions program to comply with U.S. and Bermuda laws [160]. - Regulatory changes in the insurance industry could impose greater restrictions, increasing operational costs and affecting liquidity and financial results [242]. - The company’s Class A common stock is registered with the SEC but not under foreign laws, posing a risk of regulatory penalties in foreign jurisdictions [257]. Operational and Technological Risks - The company relies on independent consultants for distribution, with almost 1,000 active consultants internationally and nearly 600 independent agencies domestically [176]. - The company relies on independent consultants for product distribution, which may impact its ability to attract effective sales representatives [189]. - Citizens, Inc. relies on independent consultants for sales, which poses risks related to maintaining relationships and could lead to declines in insurance product sales if not managed effectively [232]. - The company is continuously enhancing its information systems to adapt to technological changes, with potential risks of system failures or security gaps that could adversely affect operations [252]. - The company has disaster recovery systems in place, but unanticipated problems could materially impact operations and financial condition [255]. - The company has insurance against certain cyber risks, but potential litigation and financial losses may exceed policy limits [254]. Claims and Reserves Management - The company maintains reserves to cover estimated exposure for claims related to issued insurance policies, which may require adjustments based on future developments, potentially increasing expenses and negatively affecting financial results [230]. - The company faces risks associated with the collectability of reinsurance recoverables, which depend on the solvency of individual reinsurers [229]. - The company has faced legal proceedings involving allegations of tortious interference and misappropriation of trade secrets [263]. Internal Controls and Financial Reporting - The company maintains effective internal control over financial reporting as of December 31, 2022, based on management's evaluation [567]. - The company's internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting [566]. - The company's consolidated financial statements for the year ended December 31, 2022, received an unqualified opinion from the auditing firm [570].