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Item 1. Financial Statements

2025-11-06 compared with 2025-08-07 · 198 added, 152 removed, 1084 unchanged (24% of the section changed)

3 unchanged sentences

Consolidated Balance Sheets

(In thousands) June 30, 2025 December 31, 2024

(In thousands) September 30, 2025 December 31, 2024

Fixed maturity securities available-for-sale, at fair value (amortized cost:

10 unchanged sentences

Accrued investment income 17,285 17,546

Receivable for securities 12,946 —

Reinsurance recoverable 10,385 6,941

7 unchanged sentences

See accompanying Notes to Consolidated Financial Statements.

June 30, 2025 | 10-Q 2

September 30, 2025 | 10-Q 2

CITIZENS, INC.

1 unchanged sentence

Consolidated Balance Sheets, Continued

(In thousands, except share amounts) June 30, 2025 December 31, 2024

(In thousands, except share amounts) September 30, 2025 December 31, 2024

Liabilities and Stockholders' Equity:

14 unchanged sentences

Deferred federal income tax liability 5,224 3,442

Payable for securities

Other liabilities 47,191 48,857

12 unchanged sentences

See accompanying Notes to Consolidated Financial Statements.

June 30, 2025 | 10-Q 3

September 30, 2025 | 10-Q 3

CITIZENS, INC.

1 unchanged sentence

Consolidated Statements of Operations and Comprehensive Income (Loss)

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands, except per share amounts)

27 unchanged sentences

Per Share Amounts:

Basic and diluted earnings (loss) per share of Class A common stock

Basic earnings (loss) per share of Class A common stock 0.04 0.06 0.14 0.23

Diluted earnings (loss) per share of Class A common stock

0.04 0.05 0.14 0.22

10 unchanged sentences

See accompanying Notes to Consolidated Financial Statements.

June 30, 2025 | 10-Q 4

September 30, 2025 | 10-Q 4

CITIZENS, INC.

21 unchanged sentences

Balance at June 30, 2025 271,324 3,184 61,898 ( 83,655 ) ( 23,725 ) 229,026

Comprehensive income (loss):

Net income (loss)

— — 2,417 — — 2,417

Other comprehensive income (loss) — — — ( 5,761 ) — ( 5,761 )

Total comprehensive income (loss) — — 2,417 ( 5,761 ) — ( 3,344 )

Stock-based compensation ( 78 ) — — — — ( 78 )

Balance at September 30, 2025 $ 271,246 3,184 64,315 ( 89,416 ) ( 23,725 ) 225,604

See accompanying Notes to Consolidated Financial Statements.

September 30, 2025 | 10-Q 5

CITIZENS, INC.

AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Stockholders' Equity

Common Stock Retained Earnings

Accumulated Other Comprehensive Income (Loss)

Treasury Stock

Total Stockholders' Equity

(In thousands) Class A Class B

Balance at December 31, 2023 $ 268,675 3,184 42,150 ( 118,155 ) ( 23,725 ) 172,129

13 unchanged sentences

Balance at June 30, 2024 269,283 3,184 50,651 ( 107,924 ) ( 23,725 ) 191,469

Comprehensive income (loss):

Net income (loss)

— — 2,790 — — 2,790

Other comprehensive income (loss) — — — 13,241 — 13,241

Total comprehensive income (loss) — — 2,790 13,241 — 16,031

Stock-based compensation 73 — — — — 73

Balance at September 30, 2024 $ 269,356 3,184 53,441 ( 94,683 ) ( 23,725 ) 207,573

See accompanying Notes to Consolidated Financial Statements.

June 30, 2025 | 10-Q 5

September 30, 2025 | 10-Q 6

CITIZENS, INC.

1 unchanged sentence

Consolidated Statements of Cash Flows

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands)

15 unchanged sentences

Other policyholders' liabilities 24,494 19,002

Federal income tax payable ( 995 ) 543

Federal income tax receivable

( 384 ) 1,041

Commissions payable and other liabilities ( 1,093 ) 6,397

5 unchanged sentences

Maturities and calls of fixed maturity securities, available-for-sale 30,354 37,907

Purchases of equity securities ( 120 ) —

Sales of equity securities

Principal payments on mortgage loans 6 7

6 unchanged sentences

See accompanying Notes to Consolidated Financial Statements.

June 30, 2025 | 10-Q 6

September 30, 2025 | 10-Q 7

CITIZENS, INC.

1 unchanged sentence

Consolidated Statements of Cash Flows, Continued

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands)

10 unchanged sentences

SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES:

During the six months ended June 30, 2025, various fixed maturity issuers exchanged securities with book values of $ 6.5 million for securities of equal value and $ 3.7 million during the six months ended June 30, 2024.

The Company had $ 0.8 million of net unsettled security trades at June 30, 2024 and none at June 30, 2025.

During the nine months ended September 30, 2025, various fixed maturity issuers exchanged securities with book values of $ 7.9 million for securities of equal value and $ 3.7 million during the nine months ended September 30, 2024.

The Company had $ 12.5 million net unsettled security trades at September 30, 2025 and none at September 30, 2024.

The Company recognized right-of-use assets of $ 0.2 million in exchange for new operating lease liabilities during the nine months ended September 30, 2025 and none during the nine months ended September 30, 2024.

See accompanying Notes to Consolidated Financial Statements.

June 30, 2025 | 10-Q 7

September 30, 2025 | 10-Q 8

CITIZENS, INC .

7 unchanged sentences

Citizens and its wholly-owned subsidiaries are collectively referred to as the "Company," "it," "we," "us" or "our".

The consolidated balance sheet as of June 30, 2025, the consolidated statements of operations and comprehensive income (loss) and stockholders' equity for the three and six months ended June 30, 2025 and June 30, 2024 and the consolidated statements of cash flows for the six months ended June 30, 2025 and June 30, 2024 have been prepared by the Company without audit and are not subject to audit.

In the opinion of management, all normal and recurring adjustments to present fairly the financial position, results of operations, and changes in cash flows at June 30, 2025 and for comparative periods have been made.

The consolidated balance sheet as of September 30, 2025, the consolidated statements of operations and comprehensive income (loss) and stockholders' equity for the three and nine months ended September 30, 2025 and September 30, 2024 and the consolidated statements of cash flows for the nine months ended September 30, 2025 and September 30, 2024 have been prepared by the Company without audit and are not subject to audit.

In the opinion of management, all normal and recurring adjustments to present fairly the financial position, results of operations, and changes in cash flows at September 30, 2025 and for comparative periods have been made.

The consolidated financial statements have been prepared in accordance with U.S.

19 unchanged sentences

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent

June 30, 2025 | 10-Q 8

September 30, 2025 | 10-Q 9

CITIZENS, INC .

9 unchanged sentences

ACCOUNTING STANDARDS NOT YET ADOPTED

In November 2024, the FASB issued ASU No.

ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

In November 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses", which is intended to enhance expense disclosures by requiring additional disaggregation of certain costs and expenses, on an interim and annual basis, within the footnotes to the financial statements.

1 unchanged sentence

Early adoption is permitted, and the amendments may be applied either prospectively or retrospectively.

While this ASU will impact only our disclosures and not our financial condition and results of operations, we are currently evaluating the impact of adopting this pronouncement on the consolidated financial statements.

No other new accounting pronouncements issued or effective during the year had, or is expected to have, a material impact on our consolidated financial statements.

3 unchanged sentences

(In thousands, except for %)

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Amount % Amount %

6 unchanged sentences

Total cash and invested assets $ 1,448,994 100.0 % 1,420,499 100.0 %

June 30, 2025 | 10-Q 9

September 30, 2025 | 10-Q 10

CITIZENS, INC .

1 unchanged sentence

The following tables represent the amortized cost, gross unrealized gains and losses and fair value of fixed maturity securities as of the dates indicated.

June 30, 2025

September 30, 2025

(In thousands)

29 unchanged sentences

Total fixed maturity securities $ 1,401,301 5,401 185,741 1,220,961

June 30, 2025 | 10-Q 10

September 30, 2025 | 10-Q 11

CITIZENS, INC .

2 unchanged sentences

(In thousands)

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Equity securities:

7 unchanged sentences

Equity securities are measured at fair value with the change in fair value recorded through net income (loss).

The Company recognized net investment related losses of $ 16 thousand and gains of $ 31 thousand for the three and six months ended June 30, 2025, compared to losses of $ 0.1 million and gains of $ 0.1 million for the same periods in 2024, respectively, on equity securities held.

The Company recognized net investment related gains of $ 0.3 million for both the three and nine months ended September 30, 2025, compared to gains of $ 0.4 million for both the three and nine months ended September 30, 2024, respectively, on equity securities held.

The Company considers several factors in its review and evaluation of individual investments, using the process described in Part IV, Item 15, Note 2.

Investments in the notes to the consolidated financial statements of our Form 10-K to determine whether a credit valuation loss exists.

For the three and six months ended June 30, 2025 and 2024, the Company recorded no credit valuation losses on fixed maturity securities.

For fixed maturity security investments that have unrealized losses as of June 30, 2025 and December 31, 2024, the gross unrealized losses and related fair values that have been in a continuous unrealized loss position by timeframe are as follows.

June 30, 2025 Less than 12 months Greater than 12 months Total

For the three and nine months ended September 30, 2025 and 2024, the Company recorded no credit valuation losses on fixed maturity securities.

For fixed maturity security investments that have unrealized losses as of September 30, 2025 and December 31, 2024, the gross unrealized losses and related fair values that have been in a continuous unrealized loss position by timeframe are as follows.

September 30, 2025 Less than 12 months Greater than 12 months Total

(In thousands, except for # of securities) Fair

17 unchanged sentences

Total fixed maturity securities $ 110,167 2,095 195 800,749 148,524 1,012 910,916 150,619 1,207

June 30, 2025 | 10-Q 11

September 30, 2025 | 10-Q 12

CITIZENS, INC .

21 unchanged sentences

In each category of our fixed maturity securities described above, we do not intend to sell our investments, and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases.

As of June 30, 2025 and December 31, 2024, 98.6 % and 99.2 % of the fair value of our fixed maturity securities portfolio, respectively, were rated investment grade.

As of September 30, 2025 and December 31, 2024, 99.0 % and 99.2 % of the fair value of our fixed maturity securities portfolio, respectively, were rated investment grade.

While the losses are currently unrealized, we continue to monitor all fixed maturity securities on an on-going basis as future information may become available which could result in an allowance being recorded.

1 unchanged sentence

The fair value is expected to recover as the securities approach maturity or if market yields for such investments decline.

The amortized cost and fair value of fixed maturity securities at June 30, 2025 by contractual maturity are shown in the table below.

The amortized cost and fair value of fixed maturity securities at September 30, 2025 by contractual maturity are shown in the table below.

Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Securities not due at a single maturity date have been reflected based upon final stated maturity.

June 30, 2025 Amortized

September 30, 2025 Amortized

(In thousands)

5 unchanged sentences

Total fixed maturity securities $ 1,409,626 1,270,045

June 30, 2025 | 10-Q 12

September 30, 2025 | 10-Q 13

CITIZENS, INC .

1 unchanged sentence

The Company uses the specific identification method of the individual security to determine the cost basis used in the calculation of realized gains and losses related to security sales.

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands) 2025 2024 2025 2024

3 unchanged sentences

Gross realized losses $ 75 — 517 196

During the first quarter of 2025, real estate, formerly utilized as district offices in our Home Service Insurance segment in Baton Rouge and Bogalusa, Louisiana, was reclassified from net property, plant and equipment to real estate held-for-sale and is included in other long-term investments on the consolidated balance sheets.

These investments are listed at carrying value and are no longer being depreciated.

During the three months ended June 30, 2025, the Company accepted a tender offer by Discovery Communications, Inc.

During the second quarter of 2025, the Company accepted a tender offer by Discovery Communications, Inc.

after considering the outlook of the issuer.

20 unchanged sentences

Government-sponsored enterprise securities, securities issued by states and political subdivisions and certain mortgage and asset-backed securities.

June 30, 2025 | 10-Q 13

Level 3 is comprised of financial instruments whose fair value is estimated based on non-binding broker prices utilizing significant inputs not based on or corroborated by readily available market information.

There were no securities in this category as of or during the periods ended September 30, 2025 and December 31, 2024.

September 30, 2025 | 10-Q 14

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Real estate held-for-sale is included in this category.

There were no securities in this category as of or during the periods ended June 30, 2025 and December 31, 2024.

The following tables set forth our assets measured at fair value on a recurring basis as of the dates indicated.

June 30, 2025 Level 1 Level 2 Level 3 Total

September 30, 2025 Level 1 Level 2 Level 3 Total

(In thousands)

13 unchanged sentences

Common stocks

1,142 — — 1,142

Non-redeemable preferred stock 7 — — 7

Non-redeemable preferred stock fund 3,756 — — 3,756

Total equity securities 1,371 — — 1,371

3 unchanged sentences

The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets.

June 30, 2025 | 10-Q 14

September 30, 2025 | 10-Q 15

CITIZENS, INC .

26 unchanged sentences

Fixed maturity securities, available-for-sale.

At June 30, 2025, fixed maturity securities, valued using a third-party pricing source, totaled $ 1.2 billion for Level 2 assets and comprised 92.0 % of total reported fair value of our financial assets.

At September 30, 2025, fixed maturity securities, valued using a third-party pricing source, totaled $ 1.3 billion for Level 2 assets and comprised 93.2 % of total reported fair value of our financial assets.

The Level 1 and Level 2 valuations are reviewed and updated quarterly through testing by comparisons to separate pricing models, other third-party pricing services, and back tested to recent trades.

In addition, we obtain information annually relative to the third-party pricing models and review model parameters for reasonableness.

There were no Level 3 assets at June 30, 2025.

As of June 30, 2025, there were no material changes to the valuation methods or assumptions used to determine fair values, and no broker or third-party prices were changed from the values received.

There were no Level 3 assets at September 30, 2025.

As of September 30, 2025, there were no material changes to the valuation methods or assumptions used to determine fair values, and no broker or third-party prices were changed from the values received.

Equity securities.

Our equity securities are classified as Level 1 assets as their fair values are based upon quoted market prices.

Structured note.

At September 30, 2025, the Company held an investment in a structured note, which includes components classified as fixed maturity securities and other long-term investments on the consolidated balance sheets.

The partner interest is included in other long-term investments and is valued at net asset value ("NAV") as a practical expedient, which approximates fair value.

As of September 30, 2025, we are committed to fund this investment up to $ 14.6 million over the next 10 years.

Limited partnerships.

The Company considers the net asset value ("NAV") to represent the value of the investment fund and is measured by the total value of assets minus the total value of liabilities.

The following table includes information related to our investments in limited partnerships that calculate NAV per share.

For these investments, which are measured at fair value on a recurring basis, we use the NAV per share to measure fair value.

The Company recognized net investment related gains specific to change in fair value of $ 2.9 million and $ 1.4 million for the three and six months ended June 30, 2025, and gains of $ 4 thousand and $ 1.3 million on limited partnerships

June 30, 2025 | 10-Q 15

The Company considers the NAV to represent the value of the investment fund and is measured by the total value of assets minus the total value of liabilities.

The following table includes information

September 30, 2025 | 10-Q 16

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

held for the three and six months ended June 30, 2024.

related to our investments in limited partnerships that calculate NAV per share.

For these investments, which are measured at fair value on a recurring basis, we use the NAV per share to measure fair value.

The Company recognized net investment related losses of $ 3.7 million and $ 2.3 million for the three and nine months ended September 30, 2025, and gains of $ 0.5 million and $ 1.8 million on limited partnership investments held for the three and nine months ended September 30, 2024.

These investments are included in other long-term investments on the consolidated balance sheets.

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(In thousands, except for years)

11 unchanged sentences

The life spans indicated above may be shortened or extended at the fund manager's discretion, typically in one or two-year increments.

The global equity fund is redeemable monthly.

FINANCIAL INSTRUMENTS NOT CARRIED AT FAIR VALUE

2 unchanged sentences

The carrying amount and fair value for the financial assets and liabilities on the consolidated financial statements not otherwise disclosed for the periods indicated were as follows:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(In thousands) Carrying

6 unchanged sentences

Annuity - investment contracts 67,714 64,420 68,888 63,629

June 30, 2025 | 10-Q 16

September 30, 2025 | 10-Q 17

CITIZENS, INC .

1 unchanged sentence

Policy loans.

Policy loans had a weighted average annual interest rate of 7.7 % at both June 30, 2025 and December 31, 2024 and no specified maturity dates.

Policy loans had a weighted average annual interest rate of 7.7 % at both September 30, 2025 and December 31, 2024 and no specified maturity dates.

The aggregate fair value of policy loans approximates the carrying value reflected on the consolidated balance sheets.

3 unchanged sentences

This mortgage loan is secured by a residential property.

The interest rate for this loan was 7.0 % at both June 30, 2025 and December 31, 2024.

At June 30, 2025, the remaining loan matures in three years .

Management estimated the fair value using an annual interest rate of 6.25 % at both June 30, 2025 and December 31, 2024.

The interest rate for this loan was 7.0 % at both September 30, 2025 and December 31, 2024.

At September 30, 2025, the remaining loan matures in three years .

Management estimated the fair value using an annual interest rate of 6.25 % at both September 30, 2025 and December 31, 2024.

Our mortgage loan is considered a Level 3 asset in the fair value hierarchy and is included in other long-term investments on the consolidated balance sheets.

2 unchanged sentences

Annuity liabilities.

The fair value of the Company's liabilities under annuity contracts, which are considered Level 3 liabilities, was estimated at June 30, 2025 and December 31, 2024 using discounted cash flows based upon spot rates adjusted for various risk adjustments ranging from 3.68 % to 5.06 % and 3.96 % to 4.96 %, respectively.

The fair value of the Company's liabilities under annuity contracts, which are considered Level 3 liabilities, was estimated at September 30, 2025 and December 31, 2024 using discounted cash flows based upon spot rates adjusted for various risk adjustments ranging from 3.42 % to 4.86 % and 3.96 % to 4.96 %, respectively.

The fair value of liabilities under all insurance contracts are taken into consideration in the overall management of interest rate risk, which seeks to minimize exposure to changing interest rates through the matching of investment maturities with amounts due under insurance contracts.

4 unchanged sentences

(In thousands )

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Other long-term investments:

Limited partnerships $ 84,417 93,337

Structured note

FHLB common stock 219 212

Mortgage loans 29 33

Real estate held-for-sale

All other investments

3 unchanged sentences

(5) DEFERRED POLICY ACQUISITION COSTS AND COST OF INSURANCE ACQUIRED

The following tables roll forward the DAC and COIA balances for the six months ended June 30, 2025 and 2024 by reporting cohort.

Our reporting cohorts are Permanent, which summarizes insurance policies with premiums payable over the lifetime of the policy, and Permanent Limited Pay, which summarizes insurance policies with

June 30, 2025 | 10-Q 17

The following tables roll forward the DAC and COIA balances for the nine months ended September 30, 2025 and 2024 by reporting cohort.

Our reporting cohorts are Permanent, which summarizes insurance policies with premiums payable over the lifetime of the policy, and Permanent Limited Pay, which summarizes insurance policies

September 30, 2025 | 10-Q 18

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

premiums payable for a limited time after which the policy is fully paid up.

with premiums payable for a limited time after which the policy is fully paid up.

Both reporting cohorts include whole life and endowment policies.

Six Months Ended June 30, 2025

Nine Months Ended September 30, 2025

(In thousands)

15 unchanged sentences

Balance, end of period $ 183,176 29,224 1,723 214,123

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In thousands)

15 unchanged sentences

Balance, end of period $ 163,136 26,688 2,444 192,268

June 30, 2025 | 10-Q 18

September 30, 2025 | 10-Q 19

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DAC capitalization decreased for the six months ended June 30, 2025, compared to the same prior year period mainly from increased ceding commissions and expenses due to a full six months of reinsurance with RGA in 2025 offset by higher first year sales.

Six Months Ended June 30, 2025

DAC capitalization decreased for the nine months ended September 30, 2025, compared to the same prior year period mainly from increased ceding commissions and expenses due to a full nine months of reinsurance with RGA in 2025 offset by higher first year sales.

Nine Months Ended September 30, 2025

(In thousands)

12 unchanged sentences

Balance, end of period $ 7,130 774 1,237 9,141

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In thousands)

16 unchanged sentences

Permanent, which summarizes insurance policies with premiums payable over the lifetime of the policy,

June 30, 2025 | 10-Q 19

September 30, 2025 | 10-Q 20

CITIZENS, INC .

2 unchanged sentences

Both reporting cohorts include whole life and endowment policies.

June 30, 2025

September 30, 2025

(In thousands)

5 unchanged sentences

Beginning balance at original discount rate 310,919 15,180 326,099 101,026 14,732 115,758

Effect of changes in cash flow assumptions ( 5,915 ) 4,119 ( 1,796 ) 831 ( 82 ) 749

Effect of actual variances from expected experience

11 unchanged sentences

Beginning balance at original discount rate 1,051,493 201,797 1,253,290 218,555 123,016 341,571

Effect of changes in cash flow assumptions ( 7,051 ) 5,992 ( 1,059 ) ( 624 ) ( 306 ) ( 930 )

Effect of actual variances from expected experience

9 unchanged sentences

Net liability for future policy benefits $ 701,867 173,515 875,382 107,222 100,302 207,524

Flooring impact ( 2 ) — ( 2 ) — — —

Reinsurance recoverable 5,786 — 5,786 — — —

Net liability for future policy benefits, after reinsurance recoverable $ 696,079 173,515 869,594 107,222 100,302 207,524

June 30, 2025 | 10-Q 20

September 30, 2025 | 10-Q 21

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

September 30, 2024

(In thousands)

4 unchanged sentences

Beginning balance at original discount rate 252,426 13,533 265,959 102,045 15,512 117,557

Effect of changes in cash flow assumptions 17,731 274 18,005 ( 462 ) 21 ( 441 )

Effect of actual variances from expected experience

11 unchanged sentences

Beginning balance at original discount rate 995,962 202,755 1,198,717 217,524 123,941 341,465

Effect of changes in cash flow assumptions 18,320 734 19,054 ( 502 ) ( 1,078 ) ( 1,580 )

Effect of actual variances from expected experience

10 unchanged sentences

Reinsurance recoverable 1,308 — 1,308 — — —

Net liability for future policy benefits, after flooring impact $ 705,140 174,312 879,452 107,113 101,742 208,855

June 30, 2025 | 10-Q 21

Net liability for future policy benefits, after reinsurance recoverable $ 731,773 180,572 912,345 113,324 105,728 219,052

September 30, 2025 | 10-Q 22

CITIZENS, INC .

1 unchanged sentence

The following table reconciles the net liability for future policy benefits shown above to the liability for future policy benefits reported in the consolidated balance sheets.

June 30, 2025

June 30, 2024

September 30, 2025

September 30, 2024

(In thousands) Life

13 unchanged sentences

The following table provides the amount of undiscounted and discounted expected gross premiums and expected future benefit payments for long-term duration contracts.

June 30, 2025 June 30, 2024

September 30, 2025 September 30, 2024

(In thousands) Life

13 unchanged sentences

Expected future benefit payments 193,339 114,544 195,610 120,606

June 30, 2025 | 10-Q 22

September 30, 2025 | 10-Q 23

CITIZENS, INC .

1 unchanged sentence

The following tables summarize the amount of revenue and interest related to long-term duration contracts recognized in the consolidated statement of operations and comprehensive income (loss).

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

2025 2024 2025 2024

23 unchanged sentences

Total $ 10,518 3,043 10,712 2,985 31,906 9,102 32,480 8,934

June 30, 2025 | 10-Q 23

September 30, 2025 | 10-Q 24

CITIZENS, INC .

1 unchanged sentence

The following table provides the weighted-average durations of the liability for future policy benefits.

June 30, 2025 June 30, 2024

September 30, 2025 September 30, 2024

(In years) Life

8 unchanged sentences

The following table provides the weighted-average interest rates for the liability for future policy benefits.

June 30, 2025 June 30, 2024

September 30, 2025 September 30, 2024

Insurance Home Service

9 unchanged sentences

At Guaranteed Minimum 1 Basis Point-50 Basis Points Above 51 Basis Points-150 Basis Points Above Greater Than 150 Basis Points Above Total

June 30, 2025

September 30, 2025

(In thousands)

9 unchanged sentences

Total $ 149,416 564 26,971 68,668 245,619

June 30, 2025 | 10-Q 24

September 30, 2025 | 10-Q 25

CITIZENS, INC .

1 unchanged sentence

At Guaranteed Minimum 1 Basis Point-50 Basis Points Above 51 Basis Points-150 Basis Points Above Greater Than 150 Basis Points Above Total

June 30, 2024

September 30, 2024

(In thousands)

10 unchanged sentences

The following tables summarize balances of and changes in policyholders' account balances.

June 30, 2025

September 30, 2025

(In thousands, except for %)

5 unchanged sentences

Interest credited 2,060 2,251 1,473 625

Other 3 — — —

Surrenders and withdrawals — 10,149 3,986 6,125

3 unchanged sentences

Cash surrender value $ 79,947 86,969 50,145 28,558

June 30, 2024

September 30, 2024

(In thousands, except for %)

10 unchanged sentences

Cash surrender value $ 57,030 87,327 47,052 30,600

June 30, 2025 | 10-Q 25

September 30, 2025 | 10-Q 26

CITIZENS, INC .

1 unchanged sentence

The following table reconciles policyholders' account balances shown above to the policyholders' account balance liability in the consolidated balance sheets.

As of June 30,

As of September 30,

(In thousands)

21 unchanged sentences

(In thousands)

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Life insurance in force:

3 unchanged sentences

Net life insurance in force $ 4,568,040 4,409,718

June 30, 2025 | 10-Q 26

September 30, 2025 | 10-Q 27

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company's reinsurance recoverable on ceded reinsurance was $ 9.4 million and $ 6.9 million as of June 30, 2025 and December 31, 2024, respectively.

The Company's reinsurance recoverable on ceded reinsurance was $ 10.4 million and $ 6.9 million as of September 30, 2025 and December 31, 2024, respectively.

Premiums, claims and surrenders assumed and ceded, and expenses ceded for all lines of business are summarized for the periods indicated below.

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands) 2025 2024 2025 2024

22 unchanged sentences

Commitments and Contingencies of our 2024 consolidated financial statements and notes thereto included in the Form 10-K includes a discussion of our legal proceedings.

There have been no material developments in the six months ended June 30, 2025 from the legal proceedings described in our 2024 consolidated financial statements and notes thereto included in the Form 10-K .

There have been no material developments in the nine months ended September 30, 2025 from the legal proceedings described in our 2024 consolidated financial statements and notes thereto included in the Form 10-K .

CONTRACTUAL OBLIGATIONS

As of June 30, 2025, CICA International is committed to fund investments up to $ 10.5 million related to limited partnerships previously described.

As of September 30, 2025, CICA International is committed to fund investments up to $ 20.7 million related to limited partnership and structured note investments previously described.

CREDIT FACILITY

3 unchanged sentences

At the Company's election, the revolving loans may either bear a rate (a fluctuating rate per annum) equal to

June 30, 2025 | 10-Q 27

September 30, 2025 | 10-Q 28

CITIZENS, INC .

4 unchanged sentences

The Credit Facility contains customary events of default and financial, affirmative and negative covenants including, but not limited to, restrictions on indebtedness, liens, investments, asset dispositions and restricted payments.

As of June 30, 2025, the Company had no t borrowed any funds against the Credit Facility and was not in violation of any covenants.

As of September 30, 2025, the Company had no t borrowed any funds against the Credit Facility and was not in violation of any covenants.

(9) STOCKHOLDERS' EQUITY AND RESTRICTIONS

4 unchanged sentences

A summary of the change in the number of shares of Class A common stock and treasury stock issued is as follows:

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands)

7 unchanged sentences

The following table sets forth the computation of basic and diluted earnings per share.

Three Months Ended June 30, 2025 2024

Three Months Ended September 30, 2025 2024

(In thousands, except per share amounts)

1 unchanged sentence

Net income (loss) $ 2,417 2,790

$ 6,459 3,959

Net income (loss) allocated to Class A common stock

$ 6,459 3,959

Weighted average shares of Class A outstanding - basic 50,265 49,837

Weighted average shares of Class A outstanding - diluted 51,570 50,669

Basic and diluted earnings per share of Class A common stock

June 30, 2025 | 10-Q 28

Basic earnings per share of Class A common stock $ 0.04 0.06

Diluted earnings per share of Class A common stock

September 30, 2025 | 10-Q 29

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Six Months Ended June 30, 2025 2024

Nine Months Ended September 30, 2025 2024

(In thousands, except per share amounts)

1 unchanged sentence

Net income (loss) $ 7,253 11,291

$ 4,836 8,501

Net income (loss) allocated to Class A common stock

$ 4,836 8,501

Weighted average shares of Class A outstanding - basic 50,099 49,687

Weighted average shares of Class A outstanding - diluted 51,401 50,519

50,897 50,775

Basic and diluted earnings per share of Class A common stock

Basic earnings per share of Class A common stock $ 0.14 0.23

Diluted earnings per share of Class A common stock

STATUTORY CAPITAL AND SURPLUS

1 unchanged sentence

National Association of Insurance Commissioners ("NAIC").

All domestic insurance subsidiaries exceeded the minimum capital requirements at June 30, 2025.

All domestic insurance subsidiaries exceeded the minimum capital requirements at September 30, 2025.

On March 27, 2024 , Citizens and the Colorado Division of Insurance entered into a capital maintenance agreement that specifies that Citizens will infuse capital as needed to ensure that CICA Domestic's RBC remains above 350 %.

As CICA Domestic's RBC exceeded 350% at June 30, 2025, no capital contribution was necessary.

As CICA Domestic's RBC exceeded 350% at September 30, 2025, no capital contribution was necessary.

CICA International is a Puerto Rico domiciled company.

1 unchanged sentence

CICA International is required to maintain a minimum of $750,000 in capital and maintain a premium to surplus ratio of 7 to 1 .

At June 30, 2025, CICA International's capital exceeds both of the required minimum capital and related ratio.

At September 30, 2025, CICA International's capital exceeds both of the required minimum capital and related ratio.

(10) SEGMENT AND OTHER OPERATING INFORMATION

12 unchanged sentences

In addition to the Life Insurance and Home Service Insurance business, the Company also operates other non-insurance portions of the Company ("Other Non-Insurance Enterprises"), which primarily include the Company’s IT and corporate-support functions.

June 30, 2025 | 10-Q 29

September 30, 2025 | 10-Q 30

CITIZENS, INC .

6 unchanged sentences

Life Insurance Home Service Insurance Other Non-Insurance Enterprises Consolidated

Three Months Ended June 30, 2025

Three Months Ended September 30, 2025

(In thousands)

19 unchanged sentences

Income (loss) before federal income tax $ 3,535 2,978 ( 2,034 ) 4,479

June 30, 2025 | 10-Q 30

September 30, 2025 | 10-Q 31

CITIZENS, INC .

1 unchanged sentence

Life Insurance Home Service Insurance Other Non-Insurance Enterprises Consolidated

Six Months Ended June 30, 2025

Nine Months Ended September 30, 2025

(In thousands)

19 unchanged sentences

Income (loss) before federal income tax $ 11,926 4,705 ( 7,025 ) 9,606

June 30, 2025 | 10-Q 31

September 30, 2025 | 10-Q 32

CITIZENS, INC .

1 unchanged sentence

Life Insurance Home Service Insurance Other Non-Insurance Enterprises Consolidated

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

(In thousands)

20 unchanged sentences

Income (loss) before federal income tax $ 4,416 ( 80 ) ( 1,299 ) 3,037

June 30, 2025 | 10-Q 32

September 30, 2025 | 10-Q 33

CITIZENS, INC .

1 unchanged sentence

Life Insurance Home Service Insurance Other Non-Insurance Enterprises Consolidated

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In thousands)

24 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

6 unchanged sentences

Total premiums $ 32,785 32,201 94,582 91,667

June 30, 2025 | 10-Q 33

September 30, 2025 | 10-Q 34

CITIZENS, INC .

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

8 unchanged sentences

The table below summarizes assets by segment.

As of June 30,

As of September 30,

(In thousands)

8 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(In thousands)

2 unchanged sentences

Colombia 7,088 6,512 20,103 18,538

Ecuador 3,527 3,421 10,093 9,610

Taiwan 3,031 3,520 10,084 11,679

Venezuela 3,258 3,828 9,930 10,806

Ecuador 3,366 3,145 6,566 6,189

Argentina 3,180 2,790 8,199 7,561

2 unchanged sentences

Total premiums $ 43,303 42,897 126,488 124,129

June 30, 2025 | 10-Q 34

September 30, 2025 | 10-Q 35

CITIZENS, INC .

2 unchanged sentences

The effective tax rate is the ratio of tax expense or tax benefit over pre-tax income.

The tax benefit effective rates were 6.6 % and 5.7 % for the three and six months ended June 30, 2025, compared to effective tax rate of ( 19.9 )% and ( 3.3 )% for the same periods in 2024.

The tax benefit effective rates were 46.0 % and 24.5 % for the three and nine months ended September 30, 2025, compared to effective tax rate of 8.1 % and ( 0.2 )% for the same periods in 2024.

CICA International is considered a controlled foreign corporation for federal income tax purposes.

2 unchanged sentences

The effective tax rate varies from the prevailing corporate federal income tax rate of 21% mainly due to the impact of Subpart F and the reduced Puerto Rico income tax rate.

At June 30, 2025 and 2024, we determined it was more likely than not that a portion of our capital deferred tax assets would not be realized in their entirety.

The Company recorded valuation allowances of $ 4.8 million and $ 5.0 million at June 30, 2025 and 2024, respectively, in Accumulated Other Comprehensive Income (Loss).

At September 30, 2025 and 2024, we determined it was more likely than not that a portion of our capital deferred tax assets would not be realized in their entirety.

The Company recorded valuation allowances of $ 4.2 million and $ 3.8 million at September 30, 2025 and 2024, respectively, in Accumulated Other Comprehensive Income (Loss).

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S.

1 unchanged sentence

The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.

We are currently assessing its impact on our consolidated financial statements.

The Company had an immaterial impact to our income tax expense or effective tax rate for the enactment of OBBBA for the three and nine months ended September 30, 2025.

(12) OTHER COMPREHENSIVE INCOME (LOSS)

The changes in the components of other comprehensive income (loss) are reported net of the effects of income taxes of 21% for domestic entities and 4 % for Puerto Rican entities for the three and six months ended June 30, 2025 and 2024.

September 30, 2025 | 10-Q 36

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024.

The following table provides a rollforward of accumulated other comprehensive income (loss) for the periods indicated below.

13 unchanged sentences

( 152,363 ) 68,708 ( 83,655 )

June 30, 2025 | 10-Q 35

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(In thousands) Unrealized Gains and Losses on Available for Sale Securities Discount Rate for Liability for Future Policy Benefits Other Comprehensive Income (Loss)

Other comprehensive income (loss) before reclassification, before tax 22,623 ( 29,058 ) ( 6,435 )

Amounts reclassified from other comprehensive income (loss), before tax ( 691 ) — ( 691 )

Income tax benefit (expense) ( 1,357 ) 2,722 1,365

Balance at September 30, 2025, net of tax

$ ( 131,788 ) 42,372 ( 89,416 )

Balance at December 31, 2023, net of tax

11 unchanged sentences

( 166,713 ) 58,789 ( 107,924 )

Other comprehensive income (loss) before reclassification, before tax 59,101 ( 45,404 ) 13,697

Amounts reclassified from other comprehensive income (loss), before tax ( 100 ) — ( 100 )

Income tax benefit (expense) ( 4,339 ) 3,983 ( 356 )

Balance at September 30, 2024, net of tax

$ ( 112,051 ) 17,368 ( 94,683 )

September 30, 2025 | 10-Q 37

CITIZENS, INC .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(13) RELATED PARTY TRANSACTIONS

The Company has various routine related party transactions in conjunction with our holding company structure, such as management service agreements related to costs incurred, a tax sharing agreement between entities, and inter-company dividends and capital contributions.

There were no changes related to these relationships during the six months ended June 30, 2025.

There were no changes related to these relationships during the nine months ended September 30, 2025.

See our Form 10-K for a comprehensive discussion of related party transactions.

1 unchanged sentence

The Company has evaluated the impact of subsequent events as defined by the accounting guidance through the date this report was issued and determined that no other significant subsequent events need to be recognized or disclosed at this time.

June 30, 2025 | 10-Q 36

September 30, 2025 | 10-Q 38

CITIZENS, INC.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements