What changed in this filing

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Item 1. Business

2026-03-12 compared with 2025-03-13 · 141 added, 149 removed, 132 unchanged (69% of the section changed)

Citizens, Inc.

("Citizens" or the "Company") is an insurance holding company incorporated in Colorado and with its headquarters in Austin, Texas, serving the life insurance needs of individuals in the United States since 1969 and internationally since 1975.

Through our domestic insurance subsidiaries, we are licensed to issue insurance products in 43 U.S.

states and through our international subsidiaries, we provide insurance benefits to residents in almost 80 different countries.

We pursue a strategy of offering traditional insurance products in niche markets where we believe we are able to achieve competitive advantages.

Incorporated in Colorado and based in Austin, Texas, Citizens, Inc.

("Citizens" or the "Company") is an insurance holding company.

Since 1969 it has addressed the life insurance needs of people in the United States, and since 1975, it has extended life insurance offerings to clients worldwide.

Through our international insurance subsidiary, we provide insurance benefits to residents in over 80 different countries, and through our domestic insurance subsidiaries, we are licensed to issue insurance products in 43 U.S.

We pursue a strategy of offering insurance products in niche markets where we believe we are able to achieve competitive advantages.

We had approximately $1.8 billion of assets and over $5.4 billion of direct insurance in force at December 31, 2025.

We operate in two business segments:

• Life Insurance - Internationally, we sell U.S.

dollar-denominated whole life insurance, endowment and critical illness policies to non-U.S.

We operate in the following two business segments.

International Insurance

dollar-denominated life insurance, endowment and other financial products to non-U.S.

residents, located principally in Latin America and the Pacific Rim.

we primarily sell whole life final expense insurance and insurance with living benefits.

• Home Service Insurance - We sell affordable life insurance policies to lower-income households in Louisiana, Mississippi and Arkansas.

Our Principal Brands

LIFE INSURANCE SEGMENT

Internationally, we conduct our Life Insurance segment business through CICA Life, A.I., a Puerto Rico company ("CICA International").

Domestically, we conduct our Life Insurance segment business through CICA Life Insurance Company of America ("CICA Domestic").

HOME SERVICE INSURANCE SEGMENT

We conduct our Home Service Insurance segment through Security Plan Life Insurance Company ("SPLIC") and Magnolia Guaranty Life Insurance Company ("Magnolia").

CICA Life, A.I.

("CICA International") issues our international policies.

Domestic Insurance

We sell life insurance and other financial products in the United States.

The majority of first year premiums in our Domestic Insurance segment are generated from final expense whole life products sold through CICA Life Insurance Company of America ("CLOA").

Security Plan Life Insurance Company ("SPLIC") issues final expense whole life policies throughout Louisiana, Mississippi and Arkansas, which are intended to cover funeral and burial costs.

As an insurance provider, we collect premiums on an ongoing basis from our policyholders and invest the majority of the premiums to pay future benefits, including claims, maturities, surrenders and policyholder dividends.

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In addition to paying and reserving for insurance benefits that we pay to our policyholders and their beneficiaries, our expenses consist primarily of the costs of selling our insurance products, operating expenses and income taxes.

Because collection of premiums is the primary source of our revenues, our overall financial performance depends primarily upon the successful development, distribution and persistency of our products.

Because insurance premiums are the primary source of our revenues, our overall financial performance depends primarily upon the successful development, distribution and persistency of our products.

A key to product development is the accuracy of our pricing assumptions, as profitability is affected by actual experience deviations from the established assumptions.

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The Pursuit of Profitable Growth

Historically, our insurance companies have only issued a few products and had limited distribution channels.

Domestically, most of our historical growth came from the acquisition of assets rather than new sales.

Internationally, our limited products, which were mostly endowment products, burdened us with known high levels of maturities after a certain period with limited products to replace the business.

Historically, our insurance companies have issued only a few products and had limited distribution channels.

Domestically, most of our historical growth came from the acquisition of blocks of insurance business rather than new policy sales.

Internationally, we issued mostly endowment products, which pay a maturity benefit if the insured survives the policy term.

This has burdened us with contractual high levels of maturities and until recently, with limited products available to replace the maturing business.

As a result, from 2017 through 2021, our total premium revenue fell by over $20 million.

In 2021, we became a non-controlled company for the first time in over 20 years and under new leadership, our strategy shifted to the pursuit of long-term profitable growth through a 4-pronged strategy:

• Grow first year sales to reverse the decline in our total revenue.

We do this through the introduction of new products and by expanding our distribution.

Our product development process focuses on our customer needs by developing new products tailored to our specific markets, working with partners to develop products tailored to their markets, and enhancing existing products.

Our management team meets regularly to ensure we are bringing the right products to market at the right time.

• Distribution.

New products help our sales force, as they can sell additional products to existing customers and offer a broader portfolio of products to entice prospective customers.

A broader product portfolio also helps attract new distributors.

We are also focused on implementing sales promotions and campaigns in order to align our sales consultant compensation opportunities with our premium revenue goals and our growth and retention initiatives.

• Slow the decline of premiums through retention efforts.

• Grow first year sales.

One of our primary objectives is to drive growth in first-year sales in order to drive total premium increases.

This involves a dual approach:

introducing innovative new products and expanding our distribution channels to reach broader customer segments.

• Improve Policy Retention (Persistency).

We pay certain costs (e.g., commissions, underwriting, marketing expenses) to obtain new policyholders.

First year commissions paid to our agents are significantly higher than renewal commissions.

Additionally, a certain expected retention rate is considered in pricing a product.

Accordingly, it is important to preserve policyholder relationships once we have issued a new policy.

We are focused on improving the customer experience and policyholder retention.

We are focused on improving the customer experience so they keep their policies longer.

• Focus on execution.

• Processes .

We are implementing process improvements and new technologies not only to speed up product delivery but also to improve the experience for both our policyholders and our agents.

We have also implemented new processes and technologies to help our employees work more effectively and efficiently.

To improve the efficiency of project execution, we established a detailed roadmap focused on implementing process upgrades and integrating advanced technologies.

These measures are expected to expedite product delivery and provide a better experience for our agents as well as our policyholders.

• Financial and expense discipline.

We believe these factors will lead to growth and profitability.

As a result of these efforts over the last few years, in 2024, our total premium revenue grew for the first time since 2017.

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We have no debt and are focused on controlling costs as we invest in the growth of our business.

As a result of these efforts over the last few years, in 2025 we experienced our second straight year of total premium revenue growth.

Prior to 2024, our total premium revenue had not grown since 2017.

Status of New and Enhanced Products;

Trends in Market Demand

As mentioned above, offering new and enhanced products and expanding our distribution are key to achieving our strategic goals.

In 2024, we issued the highest amount of insurance ever in a year by Citizens - $1.1 billion and achieved our highest ever total direct insurance in force - $5.2 billion.

• Following the filing of 3 new products in our domestic markets in 2023, we continued growing our domestic business in 2024:

◦ we became licensed in 8 additional states.

CICA Domestic is licensed in 43 states, up from 35 states at 2023 year-end and up from 32 states at 2022 year-end;

◦ we expanded our domestic distribution network, growing from over 2,000 agents at December 31, 2023 to over 5,000 agents at December 31, 2024.

This led to direct first year premium revenue growth of 106% in our Life Insurance segment.

• We maintained our A.M.

◦ CICA Domestic is rated as a B++ with a "Very Strong" balance sheet.

We believe this will help us expand our distribution networks and the appeal of our products to consumers.

• We introduced a new product in our international markets designed to allow policyholders with maturing endowments to use some or all of the funds to purchase a new life insurance policy.

This led to increased first year premiums in the international business.

LIFE INSURANCE SEGMENT

INTERNATIONAL LIFE INSURANCE

Market demand for our final expense products continued to grow in 2025 - direct first year premiums in our Domestic Insurance segment increased by 23% in 2025 as compared to 2024.

The final expense market is a general product that provides coverage amounts intended not as income replacement for working-age individuals but instead smaller amounts to cover common expenses incurred by spouses or heirs in managing the loss of a loved one.

As the percentage of the U.S.

population older than age 60 continues to increase, the market for final expense has continued to expand, driving the overall growth of these products.

Market demand also necessitated a need to elevate the customer experience through digital tools, as policyholders expect simpler buying experiences that include faster underwriting and digital experiences.

Accordingly, our 2025 project roadmap was focused on customer experience enhancements, new technology implementations and regulatory updates.

Key efforts focused on improving domestic and international customer processes—including application updates and portal upgrades — while expanding digital capabilities through new QA environments,

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OFAC integrations, document storage phases, claims tools, and authentication enhancements.

The year also featured several regulatory and product updates such as reserve rate repricing, form updates, and state compact additions, along with major strategic initiatives like technology modernization projects, and quarterly business enhancements across operations.

Because of the focused execution on our strategic goals, in 2025, we issued the second highest amount of insurance ever within a year by Citizens - $1.1 billion and achieved our highest ever total direct insurance in force - $5.4 billion.

INTERNATIONAL INSURANCE SEGMENT

We operate our International Insurance segment through CICA International.

In 2025, our International Insurance segment generated 64% of our total consolidated direct premiums.

CICA International issues primarily individual whole life insurance and endowment products in U.S.

dollar-denominated amounts to non-U.S.

The products accumulate guaranteed cash values beginning in the first policy year and provide lifetime income guarantees for an insured or for surviving beneficiaries.

In addition to death benefits, our international products have living benefit features.

In addition to death benefits, our products in this segment have living benefit features.

Most policies contain guaranteed cash values that can be used during an insured's lifetime by taking a loan or advance on the death benefit, have options for annual premium benefits, and are participating (i.e .

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The Company has registered the shares of Class A common stock issuable to participants under the SIP on a Form S-3 registration statement under the Securities Act of 1933, as amended, (the "Securities Act") that is on file with the SEC.

Computershare administers the SIP in accordance with the terms and conditions of the SIP, which is available on the Computershare website and as part of the Company’s registration statement on file with the SEC.

We believe positive attributes of our international insurance business typically include:

• larger face amount policies issued compared to our U.S.

operations, which results in lower underwriting and administrative costs per dollar of coverage;

• high persistency (retention) and low mortality charges due to our customer demographics;

• premiums paid annually at the beginning of each policy year rather than monthly or quarterly, which reduces our administrative expenses, accelerates cash flow and results in lower policy lapse rates than premium payment options with more frequently scheduled payments.

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Sales and Distribution

We sell our international products through independent marketing agencies and consultants located primarily in Latin America and the Pacific Rim.

As of December 31, 2024, we had insurance policies in force in almost 80 foreign countries and receive the majority of our premiums from Colombia, Taiwan, Venezuela, Ecuador and Argentina.

International direct premiums comprised approximately 89% of total direct premiums in the Life Insurance segment and 67% of our total consolidated direct premiums in 2024.

As of December 31, 2025, we had insurance policies in force in over 80 foreign countries and receive the majority of our premiums from Colombia, Taiwan, Ecuador, Venezuela and Argentina.

The independent marketing agencies and consultants who sell our products specialize in life insurance products.

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These agencies receive commissions for products they sell and service, as well as commission overrides on the business that their agents produce and, in return for the override, they guarantee any debt their agents owe to us.

Their agents also contract directly with us as independent consultants and receive commission compensation directly from us.

This allows us to develop a relationship with their associates so if an agency contract is terminated for any reason, we may seek to continue the existing independent consultant marketing arrangements with the associates of such agency.

Their agents contract directly with us as independent consultants and receive commission compensation directly from us.

This allows us to develop a

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relationship with their associates so if an agency contract is terminated for any reason, we may seek to continue the existing independent consultant marketing arrangements with the associates of such agency.

Our agreements typically provide that the agencies and their agents are independent consultants responsible for their own operational expenses and are the representative of the prospective insured.

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Internationally, we compete with a number of life insurance companies, as well as with financial institutions that offer insurance products.

We face competition from (i) other insurance companies that operate in the same markets and manner as we do, (ii) local companies formed and operated in the country in which an insured resides, and (iii) other foreign companies who issue insurance policies denominated in the local currency of those countries or issue products approved by regulators of those countries.

Some of these companies may have a competitive advantage over us due to their greater financial resources, histories of successful operations and brand recognition, local licensing, partnering with local insurance companies and larger marketing forces.

We believe that issuing U.S.

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• capital investment in a more secure economic environment (i.e., the U.S.).

DOMESTIC INSURANCE SEGMENT

We operate our Domestic Insurance segment through CLOA, SPLIC and Magnolia.

In 2025, our Domestic Insurance segment generated 36% of our total consolidated direct premiums.

In the last few years, we began our "white label" program to increase our domestic distribution by expanding CLOA's state licenses, developing new final expense and living benefit products, and filing these new products in multiple states.

At December 31, 2025, we were licensed in 43 states and had over 5,000 agents appointed to sell our new products.

As a result, in the past two years, we have significantly expanded our domestic premiums and distribution.

SPLIC issues final expense life insurance and critical illness products to lower-income individuals, primarily in Louisiana.

Policies issued by Magnolia are primarily burial policies which are sold and serviced through funeral homes, who are also typically the beneficiaries of the policies.

The average life insurance policy face amount issued in 2025 in CLOA was approximately $7,500 per policy and in SPLIC was approximately $13,200 per policy.

Due to the lower risk associated with small face amount polices, most of the policies we issue in this segment are "simplified issue", meaning the underwriting performed on the applications is limited and applicants are not required to undergo a physical exam or lab tests.

This leads to faster approval and ability to issue a higher volume of policies.

Sales and Distribution

Our domestic products are distributed primarily through a network of independent licensed agents and brokers who market our life insurance offerings directly to individuals and families across the United States.

These independent agents operate as non‑employees and typically represent multiple carriers, allowing them to offer consumers a broad range of product options.

This distribution model enables us to reach diverse customer segments and geographic markets without maintaining a large captive sales force.

Agents are responsible for prospecting customers, conducting needs‑based consultations, and assisting applicants through the underwriting and policy‑issuance process.

We provide agents with access to digital tools, training materials, and customer service resources designed to promote consistent and compliant sales practices.

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DOMESTIC LIFE INSURANCE

Over the last couple of years, we began our "white label" program to expand our distribution by expanding CICA Domestic's state licenses, developing new final expense and living benefit products, and filing these new products in multiple states.

At December 31, 2024, we had over 5,000 agents appointed to sell these products.

As a result, in the past year, we have significantly expanded our domestic distribution in the Life Insurance segment and first year premiums have more than doubled in this segment compared to 2023.

In 2024, domestic direct life insurance premiums comprised approximately 11% of total direct premiums in the Life Insurance segment and 9% of our consolidated total direct premiums.

The average life insurance policy face amount issued in 2024 was approximately $10,800 per policy.

Due to the lower risk associated with small face amount polices, the underwriting performed on these applications is limited.

Domestically we face competition with other insurance carriers specializing in final expense insurance.

We seek to compete effectively through policyholder service, price, product design, and distribution efforts.

While there are insurance companies competing with us, no individual company dominates any of our life insurance markets.

The Company effectively competes with other carriers, in part, due to our ability to tailor products to individual distributors' needs.

HOME SERVICE INSURANCE SEGMENT

We operate our domestic Home Service Insurance segment through SPLIC and Magnolia.

SPLIC issues final expense life insurance and critical illness products to lower-income individuals, primarily through a home service distribution model based in Louisiana.

Policies issued by Magnolia are primarily burial policies which are sold and serviced through funeral homes, who are also typically the beneficiaries of the policies.

Additionally, prior to June 30, 2023, we operated through Security Plan Fire Insurance Company ("SPFIC"), a limited liability casualty company that issued small face value property insurance policies covering dwelling and contents, primarily in Louisiana.

We ceased operations on June 30, 2023 and dissolved SPFIC in 2024.

In 2024, our Home Service Insurance segment comprised 24% of our total consolidated direct premiums.

Our Home Service Insurance products consist primarily of small face amount whole life, pre-need policies, which are designed to fund final expenses for the insured (e.g., funeral and burial costs) and critical illness products.

The average life insurance policy face amount issued in 2024 was approximately $12,800 per policy.

Due to the lower risk associated with small face amount polices, the underwriting performed on these applications is limited.

We face competition in Louisiana, Mississippi and Arkansas from other carriers specializing in final expense insurance.

We seek to compete by delivering exceptional personal service to our customers, enhancing our management team and upgrading our agent field force.

We intend to continue premium growth within this segment by focusing on direct independent agent-to-consumer sales.

support our independent agents through relationships with independent marketing organizations (“IMOs”), brokerage general agencies (“BGAs”), and other intermediaries that provide recruiting, training, compliance oversight, and product‑specific support.

These distribution partners help ensure that agents receive the tools, resources, and administrative services needed to effectively present, position, and service our products.

Compensation for independent agents generally takes the form of commissions, which vary based on product type, premium levels, and policy persistency.

Certain distribution partners may also receive override commissions or performance‑based incentives.

We operate in a highly competitive segment of the life insurance industry.

Domestically, we compete with numerous insurance carriers that offer final‑expense and other simplified‑issue life insurance products.

Competition is based on a variety of factors, including product features, pricing, underwriting standards, brand reputation, distributor relationships, customer service, and financial strength ratings.

Because we distribute our products primarily through independent agents, a significant component of our competitive position is our ability to develop strong, long‑term relationships with independent distributors and marketing organizations.

These distributors often represent multiple carriers, and our ability to tailor product designs, commission structures, and service capabilities to meet their needs is an important differentiating factor.

The final‑expense market remains fragmented, and no single competitor dominates the markets in which we operate.

We compete with both large national insurers and smaller regional carriers, many of which have substantial financial resources, broader product portfolios, or more extensive distribution networks.

We believe that our white-label strategy provides a competitive advantage in this space by offering products that align with the needs of our distributors and policyholders.

We expect competition to remain strong as carriers continue to refine underwriting models, expand digital capabilities, and pursue growth opportunities in underserved demographic segments.

We monitor competitive trends closely and adjust our product offerings, distribution support, and pricing strategies as needed to remain competitive.

We follow the industry practice of reinsuring a portion of our insurance risks with unaffiliated reinsurers.

In a reinsurance transaction, a reinsurer agrees to indemnify another insurer for part or all of its liability under a policy or policies it has issued for an agreed upon premium.

We participate in reinsurance activities in order to minimize exposure to significant risks, limit losses, and provide additional capacity for future growth.

We use reinsurance to minimize exposure to significant risks, limit losses, and provide additional capacity for growth.

We enter into various agreements with reinsurers that cover individual risks, group risks or defined blocks of business, primarily on a coinsurance and yearly renewable term basis.

For the majority of our international life insurance business, we generally retain the first $100,000 of risk on any one life and reinsure the remainder of the risk.

Therefore, under the terms of the reinsurance agreements, the reinsurers

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agree to reimburse us for the ceded amount (i.e., the death benefit amount less our retained risk) in the event a claim is paid.

The Company evaluates the maximum amount it is willing to retain from time to time and may increase its retention, which can reduce premiums ceded to our reinsurers and allow us to keep a larger portion of premiums received.

In the second quarter of 2024, CICA Domestic entered into a coinsurance agreement with RGA Reinsurance Company ("RGA") in order to provide more capacity for growth.

Under this agreement (the "RGA Agreement"), CICA Domestic initially elected for RGA to reinsure 50% of its newly written final expense business, which means that we cede 50% of premiums received and benefits paid in our domestic final expense benefit to RGA.

In our International Insurance segment, we generally retain the first $250,000 of risk on any one life and reinsure the remainder of the risk with multiple global reinsurance companies.

Under the terms of the reinsurance agreements, the reinsurers agree to reimburse us for the ceded amount (i.e., the death benefit amount less our retained risk) in the event a claim is paid.

In our Domestic Insurance segment, in the second quarter of 2024, CLOA entered into a coinsurance agreement with RGA Reinsurance Company ("RGA") in order to provide more capacity for growth.

Under this agreement (the "RGA Agreement"), CLOA initially elected for RGA to reinsure 50% of its newly written final expense business, which means that we cede 50% of premiums received for this business to RGA and they reimburse us for 50% of benefits paid to our policyholders.

Cessions under reinsurance agreements do not discharge our obligations as the primary insurer.

In the event reinsurers do not meet their obligations under the terms of the reinsurance agreements, reinsurance recoverable balances could become uncollectible.

Our amounts recoverable from reinsurers represent receivables from and/or reserves ceded to reinsurers.

The amount recoverable from reinsurers was $6.9 million as of December 31, 2024.

We focus on obtaining reinsurance from a diverse group of well-established reinsurers.

All of our reinsurers are rated A- (Excellent) or higher by A.M.

We regularly evaluate the financial condition of our reinsurers and monitor concentration risk with our reinsurers.

OTHER NON-INSURANCE ENTERPRISES

Other Non-Insurance Enterprises includes the results of our parent company, Citizens, Inc., Nexo Global Services LLC, a Puerto Rico holding company ("Nexo"), Nexo Enrollment Services LLC ("NES"), a Puerto Rico company that provides services to the customers of CICA International, and our non-insurance subsidiary, Computing Technology, Inc., which primarily provides the Company's corporate-support and information technology functions to the insurance operations.

Our amounts recoverable from reinsurers represent receivables from and/or reserves ceded to reinsurers.

The amount recoverable from reinsurers was $10.9 million as of December 31, 2025.

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NON-INSURANCE ENTERPRISES

Non-Insurance Enterprises includes the results of our parent company, Citizens, Inc.;

Nexo Global Services LLC, a Puerto Rico holding company ("Nexo");

Nexo Enrollment Services LLC ("NES"), a Puerto Rico company that provides services to the customers of CICA International;

and our non-insurance subsidiary, Computing Technology, Inc., which primarily provides the Company's corporate-support and information technology functions to the insurance operations.

OPERATIONS AND TECHNOLOGY

Most of our operations are based at our corporate headquarters in Austin, Texas.

We also conduct operations for our Home Service Insurance segment from our district offices in Louisiana, Arkansas and Mississippi, as well as our service center in Donaldsonville, Louisiana.

For the international portion of our Life Insurance segment, certain operations are conducted at our office in Puerto Rico and, starting in 2024, some customer service functions are conducted in the Philippines.

The Company is actively engaged in optimizing its operations by seeking opportunities to leverage the global workforce to meet the needs of its international policyholders.

We have a proprietary single, centrally-controlled, mainframe-based policy administration system ("PAS") that we use for all of our insurance companies.

Additional key operations for our International Insurance segment are conducted at our office in Puerto Rico, with some customer service functions occurring in the Philippines.

Operations for our Domestic Insurance segment are also conducted in our district offices in Louisiana, Arkansas and Mississippi, and at our service center in Donaldsonville, Louisiana.

We have a single, proprietary, centrally controlled, mainframe-based policy administration system ("PAS") that we use for all of our insurance companies.

Our PAS performs various functions to effectively handle our insurance operations.

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Each company and block of business we have acquired has been converted onto our PAS.

The Company is actively engaged in continued modernization of technology to invest and expand into new opportunities.

This modernization allows us to bring new products to market rapidly and automate insurance interactions to enhance user experience.

This investment is foundational to the Company's growth strategy as we pursue new product innovation and provides:

Our PAS and surrounding systems provide:

• our customers and agents with portals to be able to access account information 24/7;

• our policyholder service and claims representatives with a customer account-centric view of our policyholders and beneficiaries, reducing customer inquiry response time and claims processing time;

• streamline, automated processes that deliver the scalability needed for continue growth;

• streamlined, automated processes that deliver the scalability needed for continued growth;

• business-to-business solutions.

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We are actively engaged in continued modernization of technology to invest and expand into new opportunities, including ongoing research into next generation PAS solutions.

We expect that this modernization will allow us to bring new products to market and automate insurance interactions to enhance user experience.

This investment is foundational to the Company's growth strategy.

The insurance industry is heavily regulated and both Citizens and our insurance subsidiaries are subject to regulation and supervision by the U.S.

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GAAP financial statements with the OIC that include schedules providing information regarding premiums written and reinsurance assumed and ceded, as well as an annual actuarial certification.

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In addition to compliance with the Insurance Code, CICA International must comply with other laws and regulations of Puerto Rico, most of which apply to our domestic subsidiaries as well, including the U.S.

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In the United States, insurance is primarily regulated at the state level.

Our primary regulator in the U.S.

is the Colorado Division of Insurance, as both Citizens and CICA Domestic are Colorado companies.

We are also regulated by the departments of insurance in Louisiana (SPLIC) and Mississippi (Magnolia), as well as each of the 43 states and the District of Columbia in which we conduct insurance business.

In supervising and regulating insurance companies, state insurance departments aim to protect policyholders and the public rather than investors, and enjoy broad authority and discretion in applying applicable insurance laws and regulation for that purpose.

Our primary regulator is the Colorado Division of Insurance, as both Citizens and CLOA are Colorado companies.

We are also regulated by the departments of insurance in Louisiana (SPLIC) and Mississippi (Magnolia), as well as each of the states where we issue insurance.

In supervising and regulating insurance companies, state insurance departments aim to protect policyholders and the public rather than our stockholders, and enjoy broad authority and discretion in applying applicable insurance laws and regulation for that purpose.

The extent of this regulation varies, but most U.S.

jurisdictions have laws and regulations based upon the National Association of Insurance Commissioners ("NAIC") model rules governing the financial condition of insurers, including standards of solvency, types and concentration of investments, establishment and maintenance of reserves, credit for reinsurance and requirements of capital adequacy;

and the business conduct of insurers,

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including marketing and sales practices and claims handling.

In addition, statutes and regulations require the licensing of insurers and agents, the approval of most types of policy forms and related materials (such as advertising) and the approval of rates for certain types of insurance products.

Insurance companies are also required to file detailed annual reports with our supervisory agencies.

jurisdictions have laws and regulations based upon the National Association of Insurance Commissioners ("NAIC") model rules that govern the financial condition of insurers, including standards of solvency, types and concentration of investments, establishment and maintenance of reserves, credit for reinsurance and requirements of capital adequacy.

They also have rules that govern the business conduct of insurers, including marketing and sales practices and claims handling.

In addition, statutes and regulations require the licensing of insurers and agents Our insurance companies are also required to file detailed annual reports with our supervisory agencies.

In order for insurance regulators to monitor solvency, insurance companies are subject to risk-based capital ("RBC") requirements.

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If a company's ratio of total adjusted statutory capital to control level risk-based capital is above 200%, no regulatory intervention is needed.

In 2024, due to our strategic plan to expand CICA Domestic's business, we entered into a capital maintenance agreement with the Colorado Division of Insurance that specifies that Citizens will infuse capital as needed to ensure that CICA Domestic's RBC ratio remains at or above 350%.

In addition to monitoring our financial condition, insurance regulatory authorities (including state law enforcement agencies and attorneys general) periodically make inquiries and regularly conduct examinations regarding compliance with insurance and other laws and regulations regarding the conduct of our insurance businesses.

In 2024, due to our strategic plan to expand CLOA's business, we entered into a capital maintenance agreement with the Colorado Division of Insurance that specifies that Citizens will infuse capital as needed to ensure that CLOA's RBC ratio remains at or above 350%.

In addition to monitoring our financial condition, insurance regulatory authorities, including state law enforcement agencies and attorneys general, periodically make inquiries and conduct examinations regarding compliance with insurance and other laws and regulations regarding the conduct of our insurance businesses.

It is our practice to fully and consistently cooperate with such inquiries and examinations and take corrective action when warranted.

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The application and product forms must comply with state insurance laws regarding policy requirements.

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Once an application or product is approved in that state, we must use the approved forms to sell our products.

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Because we maintain sensitive data regarding our customers, we are also subject to additional state regulations in states where we do business, such as data security and state privacy laws.

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While primarily regulated at the state level, our domestic business is subject to various federal laws and regulations.

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HUMAN CAPITAL RESOURCES

Composition and Demographics

Our human capital is a critical component to our success.

Our employees implement and drive our strategic initiatives and contribute to the success of our products (development, underwriting, pricing adequacy, customer service), promotions and processes.

Our employees in our claims department are ultimately tasked with "keeping our promise".

Our independent consultants and agents also drive our key goals, as they sell our insurance products and provide local services to our global base of policyholders.

We also believe that we derive a great deal of strength from our diverse workforce.

Fostering an equitable and inclusive workplace with diverse teams produces more creative solutions, results in more innovative products and services and is crucial to our efforts to attract, develop and retain key talent.

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As of December 31, 2024, we had 247 full-time employees and 3 part-time employees.

The pie charts below illustrate the gender, racial, ethnic, and generational make-up of our total employee workforce as of such date.

Gender Composition

Racial/Ethnic Composition

Generational Composition

We determine race, ethnicity, gender, and generation based on our employees' self-identification or other information compiled to meet requirements of the U.S.

None of our employees are subject to a collective bargaining agreement.

We do not utilize captive employee agents to distribute our products and thus contract with over 1,000 actively producing independent consultants internationally and over 5,000 independent agencies and agents domestically to sell and service our insurance products.

In order to continue to develop, sell and administer our products, it is crucial that we continue to attract and retain both experienced employees and independent agents.

Our long‑term success depends on the strength, engagement, and integrity of our people.

Human capital management is a key component of our business strategy, as our employees and distribution partners play a central role in serving policyholders, driving profitable growth, and executing our strategic priorities.

Workforce Overview

As of December 31, 2025, we employed 243 full-time and 3 part-time individuals across the United States and Puerto Rico, none of whom are subject to a collective bargaining agreement.

Our employees work in underwriting, operations, claims, finance, actuarial, legal, compliance, information technology, customer service, product development, and other support functions.

In addition to our employees, a large portion of our sales activity is

December 31, 2025 | 10-K 9

CITIZENS, INC.

conducted through independent agents and consultants, who are not Company employees but who play an essential role in the marketing and distribution of our life insurance products.

Our human capital strategy focuses on attracting, developing, and retaining high‑performing talent;

fostering an ethical culture;

and creating a safe, healthy, and engaging workplace.

Recruitment, Talent Acquisition and Retention

We seek to attract individuals who are aligned with our mission, values, and commitment to customer service.

Our recruitment efforts emphasize:

• Selective hiring practices to meet the specialized needs of insurance operations, underwriting, actuarial services, and compliance.

• Employer‑of‑choice positioning through competitive compensation, professional development opportunities, and a flexible workplace model.

• Digital recruiting tools and partnerships with industry organizations, universities, and professional networks.

Retention remains a priority.

We regularly monitor turnover metrics, employee engagement indicators, and labor‑market competitiveness.

We also aim to provide clear career paths, opportunities, and succession planning for key roles across the company.

Human Capital Governance

Human capital matters are overseen by our Chief Human Resources Officer, executive management and the Board of Directors (through applicable committees).

Management is responsible for programs and policies related to talent acquisition, development, succession planning, compensation, and engagement, and provides periodic updates to the Board on human capital priorities, risks, and progress against objectives.

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What changed 10-K

Item 1. Business