CITIZENS, INC. 10-K

Item 9A. CONTROLS AND PROCEDURES (a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, to allow timely decisions regarding required disclosures. Our management, including our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of December 31, 2025, the end of the period covered by this Annual Report on Form 10-K. Based on such evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of December 31, 2025 to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and such information is accumulated and reported to management, including our principal executive and financial officers, as appropriate to allow timely decisions regarding disclosure. (b) MANAGEMENT REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management evaluated the design and operating effectiveness of internal control over financial reporting based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Based on this evaluation, management concluded that our internal control over financial reporting as of December 31, 2025 was effective. Grant Thornton LLP, an independent registered public accounting firm, audited the effectiveness of our internal control over financial reporting as of December 31, 2025. Their attestation report is included in Item 9A(c) of this Annual Report. December 31, 2025 | 10-K 50 Table of Contents CITIZENS, INC. (c) ATTESTATION REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Report of Independent Registered Public Accounting Firm Board of Directors and Stockholders Citizens, Inc. Opinion on Internal Control over Financial Reporting We have audited the internal control over financial reporting of Citizens, Inc. (a Colorado corporation) and subsidiaries (the “Company”) as of December 31, 2025, based on criteria established in the 2013 Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in the 2013 Internal Control — Integrated Framework issued by COSO. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ("PCAOB"), the consolidated financial statements of the Company as of and for the year ended December 31, 2025, and our report dated March 12, 2026, expressed an unqualified opinion on those financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may December 31, 2025 | 10-K 51 Table of Contents CITIZENS, INC. become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ GRANT THORNTON LLP Fort Lauderdale, Florida March 12, 2026 (d) CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING There were no changes in our internal control over financial reporting during the quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Item 9B. OTHER INFORMATION During the three months ended December 31, 2025, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Citizens, Inc. securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.” Item 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. December 31, 2025 | 10-K 52 Table of Contents CITIZENS, INC. PART III The information in this Part III indicated below is incorporated by reference from other sections of this Annual Report on Form 10-K or from our definitive proxy statement pursuant to General Instruction G(3) of Form 10-K. We plan to file our definitive proxy statement for our 2026 annual meeting of shareholders within 120 days after December 31, 2025. Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Item 10 of this Annual Report on Form 10-K incorporates by reference the information in the sections entitled "Board of Directors", "Corporate Governance", "Executive Officers" and "Other Matters" in our Proxy Statement. Item 11. EXECUTIVE COMPENSATION Item 11 of this Annual Report on Form 10-K incorporates by reference the information in the sections entitled "Board of Directors - Director Compensation", "Corporate Governance - Board Processes - Compensation Committee Interlocks and Insider Participation" and "Executive Compensation" in our Proxy Statement. Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS Item 12 of this Annual Report on Form 10-K incorporates by reference the information in the sections entitled "Stock Ownership Information" and "Securities Authorized for Issuance under Equity Compensation Plans" in our Proxy Statement. Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Item 13 of this Annual Report on Form 10-K incorporates by reference the information in the section entitled "Corporate Governance" in our Proxy Statement. Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES Item 14 of this Annual Report on Form 10-K incorporates by reference the information in the section entitled "Audit Committee Matters" in our Proxy Statement. December 31, 2025 | 10-K 53 Table of Contents CITIZENS, INC. PART IV Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a) Documents filed as part of this Report (1) and (2) Financial Statements and Schedules The financial statements and schedules listed on the following index to financial statements and financial statement schedules are filed under Part III. Item 8. Financial Statements and Supplementary Data as part of this Form 10-K. Index to Consolidated Financial Statements and Financial Statement Schedules Page Reference Report of Independent Registered Public Accounting Firm (PCAOB ID: 248 ) 55 Financial Statements at December 31, 2025 and 2024 and for the Years Ended December 31, 2025 and 2024: Consolidated Balance Sheets 57 Consolidated Statements of Operations and Comprehensive Income (Loss) 59 Consolidated Statements of Stockholders' Equity 60 Consolidated Statements of Cash Flows 61 Notes to Consolidated Financial Statements Note 1: Summary of Significant Accounting Policies 63 Note 2: Investments 69 Note 3: Fair Value Measurements 74 Note 4: Deferred Policy Acquisition Costs & Cost of Insurance Acquired 78 Note 5: Policyholders' Liabilities 80 Note 6: Policy Claim Liability 87 Note 7: Reinsurance 87 Note 8: Commitments and Contingencies 88 Note 9: Stockholders' Equity and Restrictions 90 Note 10: Segment and Other Operating Information 92 Note 11: Income Taxes 95 Note 12: Other Comprehensive Income (Loss) 98 Note 13: Stock Compensation 99 Note 14: Benefit Plans 100 Note 15: Related Party Transactions 100 Note 16: Quarterly Financial Information (Unaudited) 101 Note 17: Subsequent Events 101 Financial Statement Schedules at December 31, 2025 and 2024 and for the Years Ended December 31, 2025 and 2024: Schedule II – Condensed Financial Information of Registrant 102 Schedule III – Consolidated Supplementary Insurance Information 105 Schedule IV – Consolidated Schedule of Reinsurance 106 All other schedules have been omitted because the required information is inapplicable or the information required is presented in the consolidated financial statements or the notes thereto filed elsewhere herein. (3) Exhibits See the Index of Exhibits . December 31, 2025 | 10-K 54 Table of Contents CITIZENS, INC. Report of Independent Registered Public Accounting Firm Board of Directors and Stockholders Citizens, Inc. Opinion on the financial statements We have audited the accompanying consolidated balance sheets of Citizens, Inc. (a Colorado corporation) and subsidiaries (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive income (loss), stockholders’ equity, and cash flows for each of the two years in the period ended December 31, 2025, and the related notes and financial statement schedules included under Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024 and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”), and our report dated March 12, 2026 expressed an unqualified opinion. Basis for opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical audit matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Assumptions used in the Estimation of the Liability for Future Policy Benefit Reserves - Life Insurance As described further in Notes 1 and 5 to the consolidated financial statements, the Company estimates a liability for future policy benefit reserves which is calculated as the present value of estimated future policy benefits to be paid to or on behalf of policyholders of life insurance contracts, less the present value of estimated future net premiums to be collected from policyholders on those same life insurance contracts. Management’s estimate of the liability for future policy benefit reserves for life insurance was $1.19 billion as of December 31, 2025. The liability is estimated using actuarial assumptions including those for mortality and lapse. Changes to the mortality and lapse assumptions impact both the timing and amount of estimated future policy benefits to be paid and future net premiums to be collected from policyholders on life insurance contracts. These assumptions, which are updated annually, are based December 31, 2025 | 10-K 55 Table of Contents CITIZENS, INC. on judgments that consider the Company’s historical experience, industry data and other factors. We identified the updating of the mortality and lapse assumptions used in the estimation of the liability for future policy benefit reserves – life insurance as a critical audit matter. The principal considerations for our determination that the updating of the mortality and lapse assumptions used in the estimation of the liability for future policy benefit reserves for life insurance contracts is a critical audit matter is that the updating of these assumptions requires management to make significant assumptions regarding mortality and lapse based on historical experience, industry data and other factors. As such, auditing the updating of such assumptions involved subjective and complex auditor judgment, including the involvement of an actuarial specialist to assess the reasonableness of these assumptions. Our audit procedures related to the updating of the mortality and lapse assumptions used in the estimation of the liability for future policy benefit reserves - life insurance included the following, among others. • We tested the design and operating effectiveness of management’s review control over the mortality and lapse assumption updating and approval processes. • With the assistance of an actuarial specialist, we evaluated management’s methodologies and assessed the reasonableness of the assumptions for mortality and lapse used in management’s calculation of future policy benefit reserves on life insurance contracts. /s/ GRANT THORNTON LLP We have served as the Company’s auditor since 2021. Fort Lauderdale, Florida March 12, 2026 December 31, 2025 | 10-K 56 Table of Contents CITIZENS, INC. CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Consolidated Balance Sheets December 31, (In thousands) 2025 2024 Assets: Investments: Fixed maturity securities, available-for-sale, at fair value (amortized cost: $ 1,432,454 and $ 1,401,301 in 2025 and 2024, respectively) $ 1,287,861 1,220,961 Equity securities, at fair value 1,356 5,447 Policy loans 67,455 71,216 Other long-term investments (portion measured at fair value $ 85,157 and $ 93,337 in 2025 and 2024, respectively) 85,439 93,604 Total investments 1,442,111 1,391,228 Cash and cash equivalents (restricted portion: $ 1,554 in 2025 and 2024) 22,976 29,271 Accrued investment income 18,241 17,546 Receivable for securities 90 — Reinsurance recoverable 10,874 6,941 Deferred policy acquisition costs 220,537 199,635 Cost of insurance acquired 8,995 9,446 Federal income tax receivable 624 148 Property and equipment, net 9,835 10,574 Due premiums 11,299 11,721 Other assets (less allowance for losses of $ 740 and $ 516 in 2025 and 2024, respectively) 9,178 8,815 Total assets $ 1,754,760 1,685,325 See accompanying Notes to Consolidated Financial Statements. December 31, 2025 | 10-K 57 Table of Contents CITIZENS, INC. CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Consolidated Balance Sheets December 31, continued (In thousands, except share amounts) 2025 2024 Liabilities and Stockholders' Equity: Liabilities: Policy liabilities: Future policy benefit reserves: Life insurance $ 1,188,089 1,172,034 Accident and health insurance 1,338 1,071 Total future policy benefit reserves 1,189,427 1,173,105 Policyholders' funds: Annuities 175,569 149,977 Dividend accumulations 51,360 47,768 Premiums paid in advance 29,055 31,182 Policy claims payable 8,772 8,822 Other policyholders' funds 7,955 7,271 Total policyholders' funds 272,711 245,020 Total policy liabilities 1,462,138 1,418,125 Commissions payable 4,186 4,546 Deferred federal income tax liability, net 5,996 3,442 Other liabilities 47,455 48,857 Total liabilities 1,519,775 1,474,970 Commitments and contingencies (Notes 7 and 8 ) Stockholders' Equity: Common stock: Class A, no par value, 100,000,000 shares authorized, 54,625,652 and 54,235,165 shares issued and outstanding as of December 31, 2025 and 2024, respectively, including shares in treasury of 4,327,810 in 2025 and 2024 272,294 269,799 Class B, no par value, 2,000,000 shares authorized, 1,001,714 shares issued and outstanding in 2025 and 2024, including shares in treasury of 1,001,714 in 2025 and 2024 3,184 3,184 Retained earnings 71,653 57,062 Accumulated other comprehensive income (loss) ( 88,421 ) ( 95,965 ) Treasury stock, at cost ( 23,725 ) ( 23,725 ) Total stockholders' equity 234,985 210,355 Total liabilities and stockholders' equity $ 1,754,760 1,685,325 See accompanying Notes to Consolidated Financial Statements. December 31, 2025 | 10-K 58 Table of Contents CITIZENS, INC. CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Consolidated Statements of Operations and Comprehensive Income (Loss) Years Ended December 31, (In thousands, except share amounts) 2025 2024 Revenues: Premiums $ 176,371 173,328 Net investment income 72,039 69,712 Investment related gains (losses), net 140 ( 2,626 ) Other income 7,066 4,587 Total revenues 255,616 245,001 Benefits and Expenses: Insurance benefits paid or provided: Claims and surrenders 165,025 146,082 Increase (decrease) in future policy benefit reserves ( 14,857 ) ( 4,286 ) Policyholder liability remeasurement (gain) loss 2,573 4,756 Policyholders' dividends 5,550 5,355 Total insurance benefits paid or provided 158,291 151,907 Commissions 47,265 49,118 Other general expenses 53,041 52,266 Capitalization of deferred policy acquisition costs ( 39,801 ) ( 41,302 ) Amortization of deferred policy acquisition costs 18,899 17,435 Amortization of cost of insurance acquired 451 597 Total benefits and expenses 238,146 230,021 Income before federal income tax 17,470 14,980 Federal income tax expense (benefit) 2,879 68 Net income 14,591 14,912 Per Share Amounts: Basic earnings per share Class A common stock $ 0.29 0.30 Diluted earnings per share Class A common stock 0.28 0.29 Other Comprehensive Income (Loss): Unrealized gains (losses) on fixed maturity securities: Unrealized holding gains (losses) arising during period 36,097 ( 30,982 ) Reclassification adjustment for losses (gains) included in net income ( 349 ) 699 Unrealized gains (losses) on fixed maturity securities, net 35,748 ( 30,283 ) Change in current discount rate for liability for future policy benefits ( 27,117 ) 56,613 Income tax expense (benefit) on other comprehensive income items 1,087 4,140 Other comprehensive income (loss) 7,544 22,190 Total comprehensive income (loss) $ 22,135 37,102 See accompanying Notes to Consolidated Financial Statements. December 31, 2025 | 10-K 59 Table of Contents CITIZENS, INC. 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 Comprehensive income (loss): Net income (loss) — — 14,912 — — 14,912 Other comprehensive income (loss) — — — 22,190 — 22,190 Total comprehensive income (loss) — — 14,912 22,190 — 37,102 Stock-based compensation 1,124 — — — — 1,124 Balance at December 31, 2024 269,799 3,184 57,062 ( 95,965 ) ( 23,725 ) 210,355 Comprehensive income (loss): Net income (loss) — — 14,591 — — 14,591 Other comprehensive income (loss) — — — 7,544 — 7,544 Total comprehensive income (loss) — — 14,591 7,544 — 22,135 Stock-based compensation 2,495 — — — — 2,495 Balance at December 31, 2025 $ 272,294 3,184 71,653 ( 88,421 ) ( 23,725 ) 234,985 See accompanying Notes to Consolidated Financial Statements. December 31, 2025 | 10-K 60 Table of Contents CITIZENS, INC. CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Consolidated Statements of Cash Flows Years Ended December 31, (In thousands) 2025 2024 Cash Flows from Operating Activities: Net income $ 14,591 14,912 Adjustments to reconcile net income to net cash provided by operating activities: Investment related (gains) losses on sales of investments and other assets, net ( 140 ) 2,626 Net deferred policy acquisition costs ( 20,902 ) ( 23,867 ) Amortization of cost of insurance acquired 451 597 Depreciation 741 619 Amortization of premiums and discounts on investments 4,436 5,116 Stock-based compensation 2,774 1,517 Deferred federal income tax expense (benefit) 1,467 ( 1,800 ) Change in: Accrued investment income ( 695 ) ( 186 ) Reinsurance recoverable ( 3,933 ) ( 2,950 ) Due premiums 422 ( 457 ) Future policy benefit reserves ( 10,795 ) ( 423 ) Other policyholders' liabilities 32,022 22,476 Federal income tax payable ( 476 ) 1,398 Commissions payable and other liabilities ( 1,332 ) 13,754 Other, net ( 645 ) ( 1,414 ) Net cash provided by operating activities 17,986 31,918 Cash Flows from Investing Activities: Sales of fixed maturity securities, available-for-sale 94,668 15,161 Maturities and calls of fixed maturity securities, available-for-sale 40,573 51,234 Purchases of fixed maturity securities, available-for-sale ( 170,432 ) ( 84,412 ) Purchases of equity securities ( 120 ) — Sales of equity securities 4,482 — Principal payments on mortgage loans 9 9 (Increase) decrease in policy loans, net 3,761 4,143 Sales of other long-term investments 24,857 3,565 Purchases of other long-term investments ( 17,023 ) ( 16,210 ) Purchases of property and equipment ( 447 ) ( 663 ) Net cash used in investing activities ( 19,672 ) ( 27,173 ) See accompanying Notes to Consolidated Financial Statements. December 31, 2025 | 10-K 61 Table of Contents CITIZENS, INC. CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Consolidated Statements of Cash Flows, Continued Years Ended December 31, (In thousands) 2025 2024 Cash Flows from Financing Activities: Annuity deposits $ 2,419 7,500 Annuity withdrawals ( 6,750 ) ( 9,578 ) Other share repurchases ( 278 ) ( 393 ) Net cash used in financing activities ( 4,609 ) ( 2,471 ) Net increase (decrease) in cash and cash equivalents ( 6,295 ) 2,274 Cash and cash equivalents at beginning of year 29,271 26,997 Cash and cash equivalents at end of year $ 22,976 29,271 SUPPLEMENTAL DISCLOSURE OF OPERATING ACTIVITIES: Cash paid for income taxes during 2025 and 2024 was $ 1.9 million and $ 0.5 million, respectively. SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES: During 2025 and 2024, various fixed maturity issuers exchanged securities with book values of $ 16.0 million and $ 3.7 million, respectively, for securities of equal value. The Company had $ 0.1 million net unsettled security trades at December 31, 2025 and none at December 31, 2024. The Company recognized $ 0.9 million right-of-use assets in exchange for new operating lease liabilities during 2025 and none during 2024. See accompanying Notes to Consolidated Financial Statements. December 31, 2025 | 10-K 62 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION AND CONSOLIDATION The accompanying consolidated financial statements of Citizens, Inc. and its wholly-owned subsidiaries have been prepared in conformity with U.S. generally accepted accounting principles ("U.S. GAAP"). The consolidated financial statements include the accounts and operations of Citizens, Inc. ("Citizens" or the "Company"), a Colorado corporation, and its wholly-owned subsidiaries, CICA Life Insurance Company of America ("CLOA"), CICA Life Ltd. ("CICA Bermuda"), Security Plan Life Insurance Company ("SPLIC"), Security Plan Fire Insurance Company ("SPFIC"), Magnolia Guaranty Life Insurance Company ("MGLIC"), Computing Technology, Inc. ("CTI"), Nexo Global Services LLC, a Puerto Rico holding company ("Nexo") and its wholly-owned subsidiaries, CICA Life A.I., a Puerto Rico company ("CICA International") and Nexo Enrollment Services LLC, a Puerto Rico service company ("NES"). All significant inter-company accounts and transactions have been eliminated. Citizens and its wholly-owned subsidiaries are collectively referred to as the "Company," "we," "it," "us," or "our". Reportable Segments and Reclassification of Prior Year Presentation Effective December 31, 2025, the Company reorganized its insurance reporting structure, shifting from Life Insurance and Home Service Insurance segments to Domestic Insurance and International Insurance segments. These changes align our segments with how we currently manage our business and better reflect the Company’s long-term growth strategy and optimize resource allocation across these segments. The information that our chief operating decision maker is regularly provided and reviews for purposes of allocating resources and assessing performance reflects these segment changes. Consequently, historical segment data has been recast to conform to the way we currently internally manage and monitor our business. For further information, see Note 10 . Segment and Other Operating Information . The recast of prior period information had no impact on our consolidated balance sheets, consolidated statements of operations and comprehensive income (loss), or consolidated cash flows statements. International Insurance. All International policies are issued by CICA International. CICA International offers U.S. dollar-denominated products to non-U.S. residents/citizens internationally, including endowment products, which are principally accumulation contracts that incorporate an element of life insurance protection and whole life insurance. These contracts are designed to provide a fixed amount of insurance coverage over the life of the insured and may utilize rider benefits to provide additional increasing or decreasing coverage and annuity benefits to enhance accumulations. NES provides services to policyholders of CICA International. Domestic Insurance. Our Domestic Insurance segment operates through our subsidiaries CLOA, which issues whole life, final expense and life products with living benefits throughout the U.S. and SPLIC and MGLIC, which focus on the life insurance needs of the lower-income markets, primarily in Louisiana, Mississippi and Arkansas. Prior to June 30, 2023, SPFIC issued dwelling and contents property insurance policies. As of June 30, 2023, the Company ceased all operations for SPFIC and SPFIC was dissolved in 2024. CTI provides data processing systems and services to the Company. SIGNIFICANT ACCOUNTING POLICIES INVESTMENTS Investment securities are classified as held-to-maturity ("HTM"), available-for-sale ("AFS") or trading. Management determines the appropriate classification at the time of purchase. The classification of securities is significant since it directly impacts the accounting for unrealized gains and losses on securities. Fixed maturity securities are classified as HTM and carried at amortized cost when management has the positive intent and the Company has the ability to hold the securities to maturity. Securities classified as AFS are carried at fair value, with the unrealized December 31, 2025 | 10-K 63 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) holding gains and losses, net of tax, reported in other comprehensive income (loss) and are not reported in earnings until realized. Our fixed maturity securities consist primarily of bonds classified as AFS. The Company does not classify any fixed maturity securities as trading or as HTM. Equity securities are measured at fair value with the change in fair value recorded through the consolidated statements of operations and comprehensive income (loss). Unrealized gains (losses) of fixed maturity securities held as AFS are shown as a separate component of stockholders' equity, net of tax, and is a separate component of other comprehensive income (loss). The Company assesses AFS fixed maturity securities in an unrealized loss position for expected credit losses. First, we assess whether we intend to sell, or it is more likely than not that we will be required to sell, the security before recovery of its amortized cost. If either of the criteria is met, the security's amortized cost is reduced to its fair value. For AFS fixed maturity securities that do not meet either criteria, we evaluate whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If management deems a credit loss has occurred, the impairment is recorded through an allowance for credit losses rather than as a write-down. Changes in the allowance for credit losses are recorded through investment related gains and losses. Any impairment that has not been recorded through an allowance for credit losses is recognized in accumulated other comprehensive income (loss) on our consolidated balance sheets. The Company made a policy election to exclude accrued interest from the amortized cost of AFS fixed maturity securities and report accrued interest separately in accrued investment income on the consolidated balance sheets. AFS fixed maturity securities are placed on non-accrual status when we no longer expect to receive all contractual amounts due. Accrued interest receivable is reversed against interest income when a security is placed on non-accrual status. Accordingly, we do not recognize an allowance for credit loss against accrued interest receivable. Premiums and discounts are amortized or accreted over the life of the related security as an adjustment to yield using the effective interest method. Dividend and interest income are recognized when earned. Realized gains and losses are included in earnings and are derived using the specific identification method for determining the cost of securities sold. The Company from time to time may dispose of an impaired security in response to asset/liability management decisions, future market movements, business plan changes, or if the net proceeds can be reinvested at a rate of return that is expected to recover the loss within a reasonable period of time. Policy loans are reported at unpaid principal balances. Other long-term investments consist primarily of investments in limited partnerships, Federal Home Loan Bank ("FHLB") common stock and mortgage loans. We initially estimate the fair value of investments in limited partnerships by reference to the transaction price. Subsequently, we obtain the fair value of these investments from net asset value information provided by the general partner or manager of the investments, the financial statements of which are audited annually. Recognition of investment income on these funds is delayed due to the availability of the related financial statements, which are generally obtained from the partnerships' general partners. As a result, our limited partnerships are generally reported on a three-month delay. We are a member of the FHLB of Dallas and such membership requires members to own stock in the FHLB. Our FHLB stock is carried at amortized cost, which approximates fair value. Mortgage loans on real estate are reported at unpaid principal balances. The Company had restricted cash equivalents and fixed maturity securities with an aggregate fair value of $ 8.1 million and $ 7.9 million at December 31, 2025 and 2024, respectively, on deposit with various state regulatory authorities to fulfill statutory requirements. CASH AND CASH EQUIVALENTS Cash consists of balances on hand and on deposit in banks and financial institutions. Cash equivalents consist of securities whose duration does not exceed 90 days at the date of acquisition. Restricted cash represents amounts December 31, 2025 | 10-K 64 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) on deposit with state regulatory authorities noted above and our appeal bond discussed in Note 8. Commitments and Contingencies . REINSURANCE RECOVERABLE Reinsurance recoverable includes expected reimbursements for policyholder claim amounts in excess of the Company's retention, as well as profit sharing and experience refund accruals. Reinsurance recoverable is reduced for estimated uncollectible amounts, if any. Reinsurance premiums, benefits and expenses are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts. The cost of reinsurance related to long duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies. The cost of reinsurance related to short duration contracts is accounted for over the coverage period. Profit-sharing and similar adjustable provisions are accrued based on the experience of the underlying policies. DEFERRED POLICY ACQUISITION COSTS Deferred policy acquisition costs (“DAC”) are costs that are incremental and directly related to the successful acquisition of new or renewal insurance contracts. Such costs include the incremental direct costs of contract acquisition, such as sales commissions; the portion of employees’ total compensation and payroll-related fringe benefits related directly to time spent performing acquisition activities, such as underwriting, issuing and processing policies for contracts that have actually been acquired; and other costs related directly to acquisition activities that would not have been incurred if the contract had not been acquired. Contracts are grouped by contract type and issue year into cohorts consistent with the grouping used in estimating the associated liability. DAC is amortized on a constant level basis for the grouped contracts over the expected term of the related contracts to approximate straight-line amortization. For the CICA International and the CLOA businesses, the constant level basis used is policy count in force. For the SPLIC business, the constant level basis used is face amount in force. The constant level bases used for amortization are projected using mortality and lapse assumptions that are based on the Company’s experience, industry data, and other factors at the end of each reporting period and are consistent with those used for the liability for future policy benefit life reserves. Annually, the Company completes experience studies with respect to mortality and lapse assumptions. If those assumptions are updated, the DAC amortization basis is recalculated and the effect of the assumption change will be reflected in the cohort level amortization in future periods. Inherent in the capitalization and amortization of DAC are certain management judgments about what acquisition costs are deferred, the ending asset balance and the annual amortization. Approximately 92 % of our capitalized DAC are attributed to first year and renewal excess commissions. The remaining 8 % are attributed to other costs that vary with and are directly related to the successful acquisition of new insurance business. Those costs generally include costs related to the production, underwriting and issuance of new business. Amortization of DAC is included in the consolidated statements of operations and comprehensive income (loss). The DAC balance on the consolidated balance sheets is reduced for actual experience in excess of expected experience. Changes in future estimates are recognized prospectively over the remaining expected contract term. COST OF INSURANCE ACQUIRED The Company recognizes an intangible asset that arises in the application of U.S. GAAP purchase accounting as the difference between the reported value and the fair value of insurance contract liabilities, or comparable amounts determined in purchased insurance business combinations. This intangible asset is referred to as the Cost of Insurance Acquired (“COIA”), which is amortized on a basis consistent with DAC, such that it is amortized in proportion to policies in force for the CICA International and the CLOA business and face amount in force for the SPLIC business to approximate straight-line amortization. A recoverability test that considers, among other things, actual experience and projected future experience is performed at least annually. These annual recoverability tests are based initially on an estimate of the available premium (gross premium less the benefit and expense portion of premium) for the next 50 years. Management December 31, 2025 | 10-K 65 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) believes that our COIA is recoverable for the years ended December 31, 2025 and 2024. This belief is based upon the analysis performed on estimated future results of the block and our annual recoverability testing. The value of COIA resulting from our various acquisitions was determined based on the present value of future profits discounted at annual rates ranging from 3.7 % to 8.5 %. PROPERTY AND EQUIPMENT Property and equipment are carried at cost less accumulated depreciation. Depreciation of property and equipment is computed using the straight-line method over the useful lives of the assets, ranging from three years to thirty years . The following is a summary of property and equipment. December 31, (In thousands) 2025 2024 Property and equipment: Home office, land and buildings $ 3,986 3,995 Furniture and equipment 1,381 1,359 Electronic data processing equipment and computer software 6,454 6,044 Real estate and equipment leases (See Note 8 ) 7,359 7,789 Total property and equipment 19,180 19,187 Accumulated depreciation ( 9,345 ) ( 8,613 ) Property and equipment, net $ 9,835 10,574 The Company has several lease agreements for real estate and equipment, such as its corporate home office, Puerto Rico service center and several district office locations for SPLIC. The Company recognizes these lease agreements on the consolidated balance sheets as a right-of-use asset and a corresponding lease liability. The Company uses its estimated incremental borrowing rate, which is derived from information available at lease commencement date, in determining the present value of lease payments. FUTURE POLICY BENEFITS AND EXPENSES As premium revenue is recognized, a liability for future policy benefits, which is the present value of estimated future policy benefits to be paid to or on behalf of policyholders less the present value of estimated future net premiums to be collected from policyholders, is accrued. The liability is estimated using current assumptions that include discount rate, mortality and lapses. These current assumptions are based on judgments that consider the Company’s historical experience, industry data, and other factors. Our traditional and limited-payment contracts are grouped into cohorts by contract type and issue year. Our reporting cohorts are (i) Permanent, which summarizes insurance policies with premiums payable over the lifetime of the policy, and (ii) Permanent Limited Pay, which summarizes insurance policies with premiums payable for a limited time after which the policy is fully paid up. Both reporting cohorts include whole life and endowment policies. The liability is adjusted for differences between actual and expected experience. The Company reviews its historical cash flow assumptions quarterly during the third quarter of the year. The net premium ratio used to calculate the liability is updated each quarter based on the current period's actual experience relative to expected experience. The revised net premium ratio is used to derive an updated liability for future policy benefits as of the beginning of the current reporting period, discounted at the locked-in discount rate. This amount is then compared to the carrying amount of the liability as of that same date, before the updating of cash flow assumptions, to determine the current period change in liability estimate. The current period change in the liability is the policyholder liability remeasurement gain or loss and is presented as a separate component of total insurance benefits paid or provided in the consolidated statements of operations and comprehensive income (loss). In subsequent periods, the revised net premiums are used to measure the liability for future policy benefits, subject to future revisions. December 31, 2025 | 10-K 66 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) For traditional and limited-payment contracts, the current discount rate assumption is a yield curve that equals the yield of an upper-medium grade fixed income instrument, based on A-quality corporate bonds. The Company selects fixed-income instruments that have been A rated by one of the major credit rating agencies, such as Moody’s or Standard & Poor’s. The current discount rate assumption is updated quarterly and used to remeasure the liability at the reporting date, with the resulting change reflected in other comprehensive income. For liability cash flows that are projected beyond the duration of market-observable A credit-rated fixed-income instruments, the Company uses the last market-observable yield level and linear interpolation to determine yield assumptions for durations that do not have market observable yields. The locked-in discount rate for policies issued prior to transition equals the rate set at contract issuance. For current year issues, the locked-in discount rate is the average of the current year quarterly discount rates and will change throughout the year as new discount rates are calculated, with the change reflected in net income. The accrued account balance for non-traditional life insurance and investment contracts is computed as deposits net of withdrawals made by the contract holder, plus amounts credited based on contract specifications, less contract fees and charges assessed, plus any additional interest. Annuity interest crediting rates range from 2.5 % to 5.5 % annually. Benefits and expenses are charged against the account balance to recognize costs as incurred over the estimated lives of the contracts. Expenses include interest credited to contract account balances and benefits paid in excess of contract account balances. Unpaid claims on accident and health policies represent the estimated liability for benefit expenses, both reported but not paid and incurred but not reported to the Company. The liability for incurred but not reported claims includes estimates for additional unreported claim amounts due derived from previously reported claims. Liabilities for unpaid claims are estimated using individual case basis valuations and statistical analysis. Those estimates are subject to the effects of trends in claim severity and frequency. Anticipated investment income is not considered in determining whether a premium deficiency exists with respect to short-duration contracts. Premium deposits accrue interest at rates ranging from 1.5 % to 6.0 % per annum. The cost of insurance is included in the premium when collected and interest is credited annually to deposit accounts. DEFERRED PROFIT LIABILITY For limited-payment products, gross premiums received in excess of net premiums are deferred at initial recognition as a deferred profit liability (“DPL”). Gross premiums are measured using assumptions consistent with those used in the measurement of the liability for future policy benefit life reserves, including discount rate, mortality and lapses. The DPL is amortized and recognized in net income within the increase (decrease) in future policy benefit reserves. The amortization basis for the DPL is the present value of insurance in force for life insurance contracts. Interest is accreted on the balance of the DPL using the locked-in discount rate. The Company reviews and updates its estimates of cash flows for the DPL at the same time as the estimates of cash flows for the liability for future policy benefit life reserves. The DPL is updated each quarter based on the current period's actual experience relative to expected experience with the changes recorded within the increase (decrease) in future policy benefit reserves in the consolidated statements of operations and comprehensive income (loss). On the consolidated balance sheets, DPL is recorded as a component of the liability for future policy benefit life reserves. PARTICIPATING POLICIES At December 31, 2025 and 2024, participating business approximated 43 % and 46 %, respectively, of direct life insurance in force. Policyholder dividends are determined based on the discretion of the board of directors of the policy issuing subsidiary. Policyholder dividends are accrued over the premium paying periods of the insurance contract. December 31, 2025 | 10-K 67 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) CONTINGENCIES An estimated loss from a contingency is accrued and charged to results of operations only if both of the following conditions are met: 1. Information available prior to the issuance of the consolidated financial statements indicates that it is probable (virtual certainty is not required) that an asset has been impaired or a liability incurred as of the date of the consolidated financial statements; and 2. The amount of the loss can be reasonably estimated. Reasonable estimation of a possible loss does not require estimating a single amount of the loss. It requires that a loss be accrued if it can be estimated within a range. If an amount within the range is a better estimate than any other amount within the range, that amount is accrued. If no amount within the range is a better estimate than any other amount, the minimum amount in the range is accrued. PREMIUM REVENUE AND RELATED EXPENSES Premiums on life policies are recognized as earned when due. Premiums paid in advance on the consolidated balance sheets are held on deposit and accrue interest at rates ranging from 1.5 % to 6.0 % until such time as the premiums become due. Premiums on accident and health policies are recognized as revenue over the contract period on a pro rata basis. Benefits and expenses are associated with earned premiums resulting in the recognition of profits over the estimated lives of the contracts. This matching is accomplished by means of a provision for future policy benefits and the capitalization and amortization of deferred policy acquisition costs and amortization of deferred profit liability for limited pay plans. Annuity policies, primarily flexible premium fixed annuity products, are accounted for in a manner consistent with accounting for interest bearing financial instruments. Premium receipts are not reported as revenue, rather as deposit liabilities to annuity contracts. The annuity products issued do not include fees or other such charges. Reserves are set up for surrenders and death benefits. Acquisition costs and premium loads are capitalized and amortized. STOCK COMPENSATION The Company accounts for stock compensation arrangements using a fair-value based method. The Company determines the fair value of performance-based and restricted stock unit awards on the date of grant. The fair value of time-based awards is recognized over the period during which an award holder is required to provide services in exchange for the award, known as the requisite service period, which is typically the vesting period using the straight-line method. Performance-based share expense is recognized based on management’s estimate of the probability of meeting the metrics identified in the performance share award agreement, assigned to each service period as these estimates develop. The Company records forfeitures and adjusts compensation expense on stock-based awards in the period they occur. INCOME TAXES Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered. A deferred tax asset is recorded only if a determination is made that it is more likely than not that the tax treatment on which the deferred tax asset depends will be sustained in the event of an audit. These determinations inherently involve management's judgment. In addition, the Company must record a tax valuation allowance with respect to deferred tax assets if it is more likely than not that the tax benefit will not be realized. The Company releases stranded tax effects in accumulated other comprehensive income on an aggregate portfolio basis. December 31, 2025 | 10-K 68 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) EARNINGS PER SHARE Basic earnings per share are computed by dividing net income available to common stockholders by the weighted average number of shares of common stock outstanding during each period. Diluted earnings per share are computed under the if-converted method for convertible securities and the treasury stock method for warrants, giving effect to all potential dilutive common stock, including options, warrants and convertible/redeemable preferred stock. The basic and diluted earnings per share of Class B common stock are one half the earnings per share of the Class A common stock. We hold 100% of our Class B common stock in treasury. USE OF ESTIMATES The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from these estimates. Significant estimates include those used in the evaluation of credit losses on fixed maturity securities, actuarially determined assets and liabilities and assumptions, valuation allowance on deferred tax assets and contingencies relating to litigation and regulatory matters. Certain of these estimates are particularly sensitive to market conditions, and deterioration and/or volatility in the worldwide debt or equity markets could have a material impact on the consolidated financial statements. RECLASSIFICATIONS Certain amounts presented in prior years have been reclassified to conform to the current presentation. ACCOUNTING PRONOUNCEMENTS ACCOUNTING STANDARDS NOT YET ADOPTED In November 2024, the FASB issued ASU No. 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. This ASU is effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. 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 pronouncement issued or effective during 2025 had, or is expected to have, a material impact on our consolidated financial statements. (2) INVESTMENTS The Company invests primarily in fixed maturity securities as shown below. Carrying Value as of December 31, (In thousands, except for %) 2025 % 2024 % Cash and invested assets: Fixed maturity securities $ 1,287,861 87.9 % $ 1,220,961 86.0 % Equity securities 1,356 0.1 5,447 0.4 Policy loans 67,455 4.6 71,216 5.0 Other long-term investments 85,439 5.8 93,604 6.6 Cash and cash equivalents 22,976 1.6 29,271 2.0 Total cash and invested assets $ 1,465,087 100.0 % $ 1,420,499 100.0 % December 31, 2025 | 10-K 69 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following tables represent the amortized cost, gross unrealized gains and losses and fair value of fixed maturity securities as of the dates indicated. December 31, 2025 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities: U.S. Treasury securities $ 5,692 61 99 5,654 U.S. Government-sponsored enterprises 1,268 86 — 1,354 States and political subdivisions 294,347 1,881 27,436 268,792 Corporate: Financial 323,056 4,137 26,847 300,346 Consumer 244,480 797 39,093 206,184 Utilities 136,005 829 20,048 116,786 Energy 82,205 473 7,622 75,056 Communications 69,719 256 8,454 61,521 All other 122,240 764 16,027 106,977 Commercial mortgage-backed 8,872 24 2 8,894 Residential mortgage-backed 111,243 28 8,183 103,088 Asset-backed 33,327 412 530 33,209 Total fixed maturity securities $ 1,432,454 9,748 154,341 1,287,861 December 31, 2024 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities: U.S. Treasury securities $ 5,939 85 115 5,909 U.S. Government-sponsored enterprises 3,152 152 — 3,304 States and political subdivisions 300,757 1,087 33,542 268,302 Corporate: Financial 272,925 1,593 33,285 241,233 Consumer 263,242 899 45,955 218,186 Utilities 126,361 220 22,770 103,811 Energy 79,247 40 9,959 69,328 Communications 70,896 111 9,910 61,097 All other 117,387 315 16,368 101,334 Commercial mortgage-backed 315 1 5 311 Residential mortgage-backed 106,661 7 13,026 93,642 Asset-backed 54,419 891 806 54,504 Total fixed maturity securities $ 1,401,301 5,401 185,741 1,220,961 December 31, 2025 | 10-K 70 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company's investments in equity securities are shown below. Fair Value as of December 31, (In thousands) 2025 2024 Equity securities: Bond mutual funds $ 219 739 Common stock 1,130 810 Non-redeemable preferred stock 7 7 Non-redeemable preferred stock fund — 3,891 Total equity securities $ 1,356 5,447 VALUATION OF INVESTMENTS AFS fixed maturity securities are reported in the consolidated financial statements at fair value with the change in fair value recorded through other comprehensive income (loss). 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 $ 0.1 million on equity securities held for the year ended December 31, 2025 and gains of $ 0.2 million on equity securities held for the year ended December 31, 2024. The Company monitors all AFS fixed maturity securities on an on-going basis relative to changes in credit ratings, market prices, earnings trends and financial performance, in addition to specific region or industry reviews. The Company evaluates whether a credit impairment exists for fixed maturity securities by considering primarily the following factors: (a) changes in the financial condition of the security's underlying collateral; (b) whether the issuer is current on contractually obligated interest and principal payments; (c) changes in the financial condition, credit rating and near-term prospects of the issuer; and (d) the payment structure of the security. The Company's best estimate of expected future cash flows used to determine the credit loss amount is a quantitative and qualitative process. Quantitative review includes information received from third-party sources such as financial statements, pricing and rating changes, liquidity and other statistical information. Qualitative factors include judgments related to business strategies, economic impacts on the issuer, overall judgment related to estimates and industry factors as well as the Company's intent to sell the security, or if it is more likely than not that the Company would be required to sell a security before recovery of its amortized cost. The Company's best estimate of future cash flows involves assumptions including, but not limited to, various performance indicators, such as historical and projected default and recovery rates, credit ratings, and current delinquency rates. These assumptions require the use of significant management judgment and include the probability of issuer default and estimates regarding timing and amount of expected recoveries, which may include estimating the underlying collateral value. In addition, projections of expected future fixed maturity security cash flows may change based upon new information regarding the performance of the issuer. Any credit losses are presented as an allowance rather than as a write-down on AFS fixed maturity securities management does not intend to sell or believes that it is more likely than not we will be required to sell. The Company recorded no credit valuation losses on fixed maturity securities for the years ended December 31, 2025 and 2024. December 31, 2025 | 10-K 71 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) For fixed maturity security investments that have unrealized losses as of December 31, 2025 and 2024, the gross unrealized losses and related fair values that have been in a continuous unrealized loss position by timeframe are as follows. December 31, 2025 Less than 12 months Greater than 12 months Total (In thousands, except for # of securities) Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses # of Securities Fixed maturity securities: U.S. Treasury securities $ — — — 883 99 7 883 99 7 States and political subdivisions 21,991 147 28 145,859 27,289 180 167,850 27,436 208 Corporate: Financial 13,485 196 23 148,244 26,651 182 161,729 26,847 205 Consumer 19,282 361 25 165,229 38,732 225 184,511 39,093 250 Utilities 12,109 170 35 82,012 19,878 152 94,121 20,048 187 Energy 11,650 214 24 44,795 7,408 55 56,445 7,622 79 Communications 10,682 126 14 39,964 8,328 50 50,646 8,454 64 All Other 4,289 38 13 72,186 15,989 93 76,475 16,027 106 Commercial mortgage-backed — — — 79 2 1 79 2 1 Residential mortgage-backed 17 — 4 93,197 8,183 77 93,214 8,183 81 Asset-backed 1,569 66 2 11,569 464 13 13,138 530 15 Total fixed maturity securities $ 95,074 1,318 168 804,017 153,023 1,035 899,091 154,341 1,203 December 31, 2024 Less than 12 months Greater than 12 months Total (In thousands, except for # of securities) Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses # of Securities Fixed maturity securities: U.S. Treasury securities $ 835 51 3 435 64 5 1,270 115 8 States and political subdivisions 42,583 1,484 63 147,534 32,058 177 190,117 33,542 240 Corporate: Financial 29,258 756 53 154,448 32,529 192 183,706 33,285 245 Consumer 37,231 2,053 57 161,795 43,902 216 199,026 45,955 273 Utilities 16,750 687 47 79,488 22,083 142 96,238 22,770 189 Energy 11,654 438 29 52,537 9,521 65 64,191 9,959 94 Communications 9,973 250 11 48,462 9,660 60 58,435 9,910 71 All Other 25,208 1,237 38 68,756 15,131 87 93,964 16,368 125 Commercial mortgage-backed 100 — 1 89 5 1 189 5 2 Residential mortgage-backed 160 2 11 93,231 13,024 84 93,391 13,026 95 Asset-backed 10,330 243 14 14,741 563 16 25,071 806 30 Total fixed maturity securities $ 184,082 7,201 327 821,516 178,540 1,045 1,005,598 185,741 1,372 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. At December 31, 2025 and 2024, 98.7 % and 99.2 %, respectively, of the fair value of our fixed maturity securities portfolio was rated investment grade. While the losses are currently unrealized, we continue to monitor December 31, 2025 | 10-K 72 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) all fixed maturity securities on an on-going basis as future information may become available which could result in an allowance being recorded. The unrealized losses on fixed maturity securities detailed in the previous tables are due to noncredit-related factors, including widening credit spreads and rising interest rates since purchase, which have little bearing on the recoverability of our investments, hence they are not recognized as credit losses. 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 December 31, 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. (In thousands) Amortized Cost Fair Value Fixed maturity securities: Due in one year or less $ 28,279 28,320 Due after one year through five years 109,760 110,282 Due after five years through ten years 302,587 303,361 Due after ten years 991,828 845,898 Total fixed maturity securities $ 1,432,454 1,287,861 There were no investments that were non-income producing for the years ended December 31, 2025 or 2024. Major categories of net investment income are summarized as follows: Years ended December 31, (In thousands) 2025 2024 Gross investment income: Fixed maturity securities $ 63,340 60,940 Equity securities 212 302 Policy loans 5,275 5,597 Other long-term investments 5,427 4,846 Other 760 834 Total investment income 75,014 72,519 Investment expenses ( 2,975 ) ( 2,807 ) Net investment income $ 72,039 69,712 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. Years ended December 31, (In thousands) 2025 2024 Fixed maturity securities: Proceeds $ 94,668 15,161 Gross realized gains $ 1,632 131 Gross realized losses $ 691 225 December 31, 2025 | 10-K 73 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Investment related gains and losses are as follows: Years ended December 31, (In thousands) 2025 2024 Investment related gains (losses): Sales, calls and maturities: Fixed maturity securities $ 349 ( 699 ) Equity securities 398 — Other long-term investments ( 134 ) ( 788 ) Investment related gains (losses) 613 ( 1,487 ) Change in fair value of equity securities ( 127 ) 164 Change in fair value of limited partnerships ( 429 ) ( 969 ) Change in fair value of structured note 307 — Change in credit loss allowance ( 224 ) ( 334 ) Net investment related gains (losses) $ 140 ( 2,626 ) (3) FAIR VALUE MEASUREMENTS Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We hold AFS fixed maturity securities, which are carried at fair value with changes in fair value reported through other comprehensive income (loss). We also report our equity securities and certain other long-term investments at fair value with changes in fair value reported through the consolidated statements of operations and comprehensive income (loss). Fair value measurements are generally based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our view of market assumptions in the absence of observable market information. We utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. All assets and liabilities carried at fair value are required to be classified and disclosed in one of the following three categories: • Level 1 - Quoted prices for identical instruments in active markets. • Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active and model-derived valuations whose inputs or whose significant value drivers are observable. • Level 3 - Instruments whose significant value drivers are unobservable. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as U.S. Treasury securities and actively traded mutual fund and stock investments. Level 2 includes those financial instruments that are valued by independent pricing services or broker quotes. These pricing models are primarily industry-standard models that consider various inputs, such as interest rates, credit spreads and foreign exchange rates for the underlying financial instruments. All significant inputs are observable or derived from observable information in the marketplace or are supported by observable levels at which transactions are executed in the marketplace. Financial instruments in this category primarily include corporate securities, U.S. Government-sponsored enterprise securities, securities issued by states and political subdivisions and certain mortgage and asset-backed securities. 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. We have no investments in this category. December 31, 2025 | 10-K 74 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following tables set forth our assets that are measured at fair value on a recurring basis as of the dates indicated. December 31, 2025 (In thousands) Level 1 Level 2 Level 3 Total Fair Value Financial assets: Fixed maturity securities: U.S. Treasury and U.S. Government-sponsored enterprises $ 5,654 1,354 — 7,008 States and political subdivisions — 268,792 — 268,792 Corporate 42 866,828 — 866,870 Commercial mortgage-backed — 8,894 — 8,894 Residential mortgage-backed — 103,088 — 103,088 Asset-backed — 33,209 — 33,209 Total fixed maturity securities 5,696 1,282,165 — 1,287,861 Equity securities: Bond mutual funds 219 — — 219 Common stock 1,130 — — 1,130 Non-redeemable preferred stock 7 — — 7 Total equity securities 1,356 — — 1,356 Other long-term investments (1) — — — 85,157 Total financial assets $ 7,052 1,282,165 — 1,374,374 (1) In accordance with Subtopic 820-10, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheet. December 31, 2024 (In thousands) Level 1 Level 2 Level 3 Total Fair Value Financial assets: Fixed maturity securities: U.S. Treasury and U.S. Government-sponsored enterprises $ 5,909 3,304 — 9,213 States and political subdivisions — 268,302 — 268,302 Corporate 42 794,947 — 794,989 Commercial mortgage-backed — 311 — 311 Residential mortgage-backed — 93,642 — 93,642 Asset-backed — 54,504 — 54,504 Total fixed maturity securities 5,951 1,215,010 — 1,220,961 Equity securities: Bond mutual funds 739 — — 739 Common stock 810 — — 810 Non-redeemable preferred stock 7 — — 7 Non-redeemable preferred stock fund 3,891 — — 3,891 Total equity securities 5,447 — — 5,447 Other long-term investments (1) — — — 93,337 Total financial assets $ 11,398 1,215,010 — 1,319,745 (1) In accordance with Subtopic 820-10, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheet. December 31, 2025 | 10-K 75 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) FINANCIAL INSTRUMENTS VALUATION FINANCIAL INSTRUMENTS CARRIED AT FAIR VALUE Fixed maturity securities, available-for-sale. At December 31, 2025, fixed maturity securities, valued using a third-party pricing source, totaled $ 1.3 billion for Level 2 assets and comprised 93.3 % 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 as of December 31, 2025 and 2024. For the year ended December 31, 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 December 31, 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 measured at its net asset value ("NAV") of $ 2.6 million as a practical expedient, which approximates fair value. The Company recognized investment related gains of $ 0.3 million for the year ended December 31, 2025. These investments are included in Other Long-term Investments on the consolidated balance sheets. As of December 31, 2025, we are committed to fund this investment up to $ 4.6 million over the next nine years . Limited partnerships. 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 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 $ 0.4 million and $ 1.0 million on limited partnerships held for the year ended December 31, 2025 and 2024, respectively. These investments are included in other long-term investments on the consolidated balance sheets. December 31, 2025 December 31, 2024 (In thousands, except years) Fair Value Using NAV Per Share Unfunded Commit- ments Range (In years) Fair Value Using NAV Per Share Unfunded Commit- ments Range (In years) Description Limited partnerships: Middle market Investments in privately-originated, performing senior secured debt primarily in North America-based companies $ 30,956 — 2 $ 35,369 1,660 3 Global equity fund Investments in common stocks of U.S., international developed and emerging markets with a focus on long-term capital growth — — 0 11,568 — 0 Late-stage growth Investments in private late-stage, established companies seeking capital to accelerate growth prior to an IPO or sale 36,623 2,232 2 to 4 27,825 8,134 3 to 5 Infrastructure Investments in environmental infrastructure and related technology, focusing on renewable power generation and distribution 15,013 4,052 8 18,575 5,637 9 Total limited partnerships $ 82,592 6,284 $ 93,337 15,431 December 31, 2025 | 10-K 76 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The majority of our limited partnership investments are not redeemable because distributions from the funds will be received when the underlying investments of the funds are liquidated. The life spans indicated above may be shortened or extended at the fund manager's discretion, typically in one or two-year increments. FINANCIAL INSTRUMENTS NOT CARRIED AT FAIR VALUE Estimates of fair values are made at a specific point in time, based on relevant market prices and information about the financial instruments. The estimated fair values of financial instruments presented below are not necessarily indicative of the amounts the Company might realize in actual market transactions. 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: December 31, 2025 December 31, 2024 (In thousands) Carrying Value Fair Value Carrying Value Fair Value Financial assets: Policy loans $ 67,455 67,455 71,216 71,216 Residential mortgage loans 24 24 33 34 Cash and cash equivalents 22,976 22,976 29,271 29,271 Financial liabilities: Annuity - investment contracts 68,975 64,066 68,888 63,629 Policy loans. Policy loans had a weighted average annual interest rate of 7.7 % at both December 31, 2025 and 2024 and no specified maturity dates. Policy loans are an integral part of the life insurance policies we have in force, cannot be valued separately and are not marketable. Therefore, the fair value of policy loans approximates the carrying value reflected on the consolidated balance sheets and are considered Level 3 assets in the fair value hierarchy. Residential mortgage loan. The mortgage loan is secured principally by a residential property. The interest rate for this loan was 7.0 % at December 31, 2025 and 2024. At December 31, 2025, the remaining loan matures in three years . Management estimated the fair value using an annual interest rate of 6.25 % at both December 31, 2025 and 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. Cash and cash equivalents. The fair value of cash and cash equivalents approximates carrying value and these assets are characterized as Level 1 assets in the fair value hierarchy. Annuity liabilities. The fair value of the Company's liabilities under annuity contracts, which are considered Level 3 liabilities, was estimated at December 31, 2025 and 2024 using discounted cash flows based upon spot rates adjusted for various risk adjustments ranging from 3.31 % to 4.98 % 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. December 31, 2025 | 10-K 77 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Other long-term investments. Financial instruments included in other long-term investments are classified in various levels of the fair value hierarchy. The following table summarizes the carrying amounts of these investments. As of December 31, (In thousands) 2025 2024 Other long-term investments: Limited partnerships $ 82,592 93,337 Structured note 2,565 — FHLB common stock 222 212 All other investments 60 55 Total other long-term investments $ 85,439 93,604 We are a member of the FHLB of Dallas and such membership requires members to own stock in the FHLB. Our FHLB stock is carried at amortized cost, which approximates fair value. (4) DEFERRED POLICY ACQUISITION COSTS AND COST OF INSURANCE ACQUIRED The following tables roll forward the DAC and COIA balances for the years ended December 31, 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 premiums payable for a limited time after which the policy is fully paid up. Both reporting cohorts include whole life and endowment policies. DAC Year Ended December 31, 2025 (In thousands) Permanent Permanent Limited Pay Other Business Total International Insurance: Balance, beginning of year $ 108,742 16,370 572 125,684 Capitalizations 17,736 3,370 265 21,371 Amortization expense ( 12,563 ) ( 1,155 ) ( 299 ) ( 14,017 ) Balance, end of year 113,915 18,585 538 133,038 Domestic Insurance: Balance, beginning of year 61,639 11,169 1,143 73,951 Capitalizations 17,290 945 195 18,430 Amortization expense ( 4,307 ) ( 431 ) ( 144 ) ( 4,882 ) Balance, end of year 74,622 11,683 1,194 87,499 Consolidated: Balance, beginning of year 170,381 27,539 1,715 199,635 Capitalizations 35,026 4,315 460 39,801 Amortization expense ( 16,870 ) ( 1,586 ) ( 443 ) ( 18,899 ) Balance, end of year $ 188,537 30,268 1,732 220,537 December 31, 2025 | 10-K 78 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Year Ended December 31, 2024 (In thousands) Permanent Permanent Limited Pay Other Business Total International Insurance: Balance, beginning of year $ 103,434 14,056 456 117,946 Capitalizations 17,592 3,314 326 21,232 Amortization expense ( 12,284 ) ( 1,000 ) ( 210 ) ( 13,494 ) Balance, end of year 108,742 16,370 572 125,684 Domestic Insurance: Balance, beginning of year 45,398 10,583 1,841 57,822 Capitalizations 18,791 1,017 262 20,070 Amortization expense ( 2,550 ) ( 431 ) ( 960 ) ( 3,941 ) Balance, end of year 61,639 11,169 1,143 73,951 Consolidated: Balance, beginning of year 148,832 24,639 2,297 175,768 Capitalizations 36,383 4,331 588 41,302 Amortization expense ( 14,834 ) ( 1,431 ) ( 1,170 ) ( 17,435 ) Balance, end of year $ 170,381 27,539 1,715 199,635 COIA The Domestic Insurance segment is the only segment that recognizes COIA; therefore, the balances for the years ended December 31, 2025 and 2024 on a consolidated basis by reporting cohort are shown below. (In thousands) Permanent Permanent Limited Pay Other Business Total Year Ended December 31, 2025 Balance, beginning of year $ 7,424 809 1,213 9,446 Amortization expense ( 388 ) ( 45 ) ( 18 ) ( 451 ) Balance, end of year $ 7,036 764 1,195 8,995 Year Ended December 31, 2024 Balance, beginning of year $ 7,443 863 1,737 10,043 Amortization expense ( 19 ) ( 54 ) ( 524 ) ( 597 ) Balance, end of year $ 7,424 809 1,213 9,446 December 31, 2025 | 10-K 79 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Estimated amortization of COIA in each of the next five years and thereafter is as follows. Actual future amortization will differ from these estimates due to variances from estimated future withdrawal assumptions. (In thousands) Amount Cost of insurance acquired: Year: 2026 $ 500 2027 472 2028 445 2029 420 2030 396 Thereafter 6,762 Total cost of insurance acquired $ 8,995 (5) POLICYHOLDERS’ LIABILITIES LIABILITY FOR FUTURE POLICY BENEFITS The following tables summarize balances of and changes in the liability for future policy benefits for our reporting cohorts: Permanent, which summarizes insurance policies with premiums payable over the lifetime of the policy, December 31, 2025 | 10-K 80 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) and Permanent Limited Pay, which summarizes insurance policies with premiums payable for a limited time after which the policy is fully paid up. Both reporting cohorts include whole life and endowment policies. December 31, 2025 (In thousands) International Insurance Domestic Insurance Permanent Permanent Limited Pay Total Permanent Permanent Limited Pay Total Present Value of Expected Net Premiums: Balance, beginning of year $ 237,944 15,592 253,536 156,432 13,248 169,680 Beginning balance at original discount rate $ 247,279 15,807 263,086 164,666 14,105 178,771 Effect of changes in cash flow assumptions ( 3,947 ) 4,277 330 ( 1,137 ) ( 240 ) ( 1,377 ) Effects of actual variances from expected experience 4,062 1,713 5,775 ( 46,814 ) ( 4,063 ) ( 50,877 ) Adjusted beginning of year balance 247,394 21,797 269,191 116,715 9,802 126,517 Issuances 31,830 4,798 36,628 100,202 2,126 102,328 Interest accrual 9,814 729 10,543 7,775 482 8,257 Net premiums collected ( 46,595 ) ( 7,330 ) ( 53,925 ) ( 24,084 ) 981 ( 23,103 ) Derecognition and other 469 411 880 ( 8,537 ) 55 ( 8,482 ) Ending balance at original discount rate 242,912 20,405 263,317 192,071 13,446 205,517 Effect of changes in discount rates ( 1,518 ) 187 ( 1,331 ) ( 2,226 ) ( 394 ) ( 2,620 ) Balance, end of year $ 241,394 20,592 261,986 189,845 13,052 202,897 Present Value of Expected Future Policy Benefits: Balance, beginning of year $ 914,153 159,244 1,073,397 281,212 139,461 420,673 Beginning balance at original discount rate $ 965,548 170,911 1,136,459 304,500 153,902 458,402 Effect of changes in cash flow assumptions ( 3,161 ) 7,277 4,116 ( 4,514 ) ( 1,590 ) ( 6,104 ) Effects of actual variances from expected experience 7,099 4,231 11,330 ( 47,059 ) ( 1,875 ) ( 48,934 ) Adjusted beginning of year balance 969,486 182,419 1,151,905 252,927 150,437 403,364 Issuances 32,505 5,145 37,650 100,133 2,119 102,252 Interest accrual 41,386 6,869 48,255 14,501 7,149 21,650 Benefit payments ( 110,801 ) ( 20,384 ) ( 131,185 ) ( 19,088 ) ( 6,977 ) ( 26,065 ) Derecognition and other ( 333 ) 26 ( 307 ) ( 8,652 ) 47 ( 8,605 ) Ending balance at original discount rate 932,243 174,075 1,106,318 339,821 152,775 492,596 Effect of changes in discount rates ( 21,668 ) ( 7,748 ) ( 29,416 ) ( 15,439 ) ( 13,555 ) ( 28,994 ) Balance, end of year $ 910,575 166,327 1,076,902 324,382 139,220 463,602 Net liability for future policy benefits $ 669,181 145,735 814,916 134,537 126,168 260,705 Plus: Flooring impact 2 — 2 — — — Less: Reinsurance recoverable — — — 6,795 — 6,795 Net liability for future policy benefits, after reinsurance recoverable $ 669,183 145,735 814,918 127,742 126,168 253,910 For the year ended December 31, 2025, the International Insurance segment had lower reserves compared to the same period in 2024, primarily due to matured endowments, which outpaced reserves added for new business sales and assumptions updates to reflect higher than anticipated persistency in later durations. For the year ended December 31, 2025 | 10-K 81 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 2025, the Domestic Insurance segment had higher reserves compared to the same period in 2024, primarily driven by high new business sales which were partially offset by favorable assumptions updates reflecting better mortality than previous assumptions. December 31, 2024 (In thousands) International Insurance Domestic Insurance Permanent Permanent Limited Pay Total Permanent Permanent Limited Pay Total Present Value of Expected Net Premiums: Balance, beginning of year $ 237,762 13,671 251,433 105,986 14,515 120,501 Beginning balance at original discount rate $ 245,312 13,920 259,232 109,159 15,125 124,284 Effect of changes in cash flow assumptions ( 1,198 ) 269 ( 929 ) 18,467 26 18,493 Effects of actual variances from expected experience 4,041 1,849 5,890 ( 29,560 ) ( 5,260 ) ( 34,820 ) Adjusted beginning of year balance 248,155 16,038 264,193 98,066 9,891 107,957 Issuances 34,493 3,612 38,105 82,252 2,306 84,558 Interest accrual 9,659 555 10,214 6,163 492 6,655 Net premiums collected ( 44,732 ) ( 4,548 ) ( 49,280 ) ( 17,863 ) 1,439 ( 16,424 ) Derecognition and other ( 296 ) 150 ( 146 ) ( 3,952 ) ( 23 ) ( 3,975 ) Ending balance at original discount rate 247,279 15,807 263,086 164,666 14,105 178,771 Effect of changes in discount rates ( 9,335 ) ( 215 ) ( 9,550 ) ( 8,234 ) ( 857 ) ( 9,091 ) Balance, end of year $ 237,944 15,592 253,536 156,432 13,248 169,680 Present Value of Expected Future Policy Benefits: Balance, beginning of year $ 954,686 165,124 1,119,810 230,610 152,782 383,392 Beginning balance at original discount rate $ 977,825 172,231 1,150,056 235,661 154,465 390,126 Effect of changes in cash flow assumptions ( 1,636 ) 701 ( 935 ) 19,454 ( 1,044 ) 18,410 Effects of actual variances from expected experience 7,917 5,127 13,044 ( 29,635 ) ( 2,764 ) ( 32,399 ) Adjusted beginning of year balance 984,106 178,059 1,162,165 225,480 150,657 376,137 Issuances 35,394 3,740 39,134 82,175 2,312 84,487 Interest accrual 42,582 6,838 49,420 12,305 7,145 19,450 Benefit payments ( 94,941 ) ( 17,765 ) ( 112,706 ) ( 16,162 ) ( 6,976 ) ( 23,138 ) Derecognition and other ( 1,593 ) 39 ( 1,554 ) 702 764 1,466 Ending balance at original discount rate 965,548 170,911 1,136,459 304,500 153,902 458,402 Effect of changes in discount rates ( 51,395 ) ( 11,667 ) ( 63,062 ) ( 23,288 ) ( 14,441 ) ( 37,729 ) Balance, end of year $ 914,153 159,244 1,073,397 281,212 139,461 420,673 Net liability for future policy benefits $ 676,209 143,652 819,861 124,780 126,213 250,993 Plus: Flooring impact 2 — 2 — — — Less: Reinsurance recoverable — — — 1,639 — 1,639 Net liability for future policy benefits, after flooring impact $ 676,211 143,652 819,863 123,141 126,213 249,354 December 31, 2025 | 10-K 82 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 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. December 31, 2025 December 31, 2024 (In thousands) International Insurance Domestic Insurance Consolidated International Insurance Domestic Insurance Consolidated Life Insurance: Permanent $ 669,183 127,742 796,925 676,211 123,141 799,352 Permanent limited pay 145,735 126,168 271,903 143,652 126,213 269,865 Deferred profit liability 27,222 38,917 66,139 24,369 36,265 60,634 Other 29,408 23,714 53,122 23,503 18,680 42,183 Total life insurance 871,548 316,541 1,188,089 867,735 304,299 1,172,034 Accident & Health: Other 686 652 1,338 500 571 1,071 Total future policy benefit reserves $ 872,234 317,193 1,189,427 868,235 304,870 1,173,105 The following table provides the amount of undiscounted and discounted expected gross premiums and expected future benefit payments for long-term duration contracts. December 31, 2025 December 31, 2024 (In thousands) International Insurance Domestic Insurance International Insurance Domestic Insurance Undiscounted: Permanent: Expected future gross premiums $ 576,100 728,775 580,852 633,954 Expected future benefit payments 1,413,471 753,657 1,442,250 668,200 Permanent Limited Pay: Expected future gross premiums 49,992 75,405 44,654 75,464 Expected future benefit payments 264,452 398,905 248,256 395,163 Discounted: Permanent: Expected future gross premiums $ 450,762 455,293 445,531 383,370 Expected future benefit payments 910,575 324,382 914,153 281,212 Permanent Limited Pay: Expected future gross premiums 44,905 48,644 39,865 49,452 Expected future benefit payments 166,327 139,220 159,244 139,461 December 31, 2025 | 10-K 83 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following tables summarize the amount of revenue and interest related to long-term duration contracts recognized in the consolidated statements of operations and comprehensive income (loss) as of the dates indicated. Years Ended December 31, (In thousands) 2025 2024 Gross Premiums Interest Expense Gross Premiums Interest Expense International Insurance: Life Insurance: Permanent $ 92,284 31,572 92,153 32,923 Permanent Limited Pay 18,498 7,152 16,322 7,213 Other 8,686 — 11,220 — Less: Reinsurance 1,822 — 1,653 — Total, net of reinsurance 117,646 38,724 118,042 40,136 Accident & Health: Other 709 — 761 — Total $ 118,355 38,724 118,803 40,136 Domestic Insurance: Life Insurance: Permanent $ 57,151 6,726 45,891 6,142 Permanent Limited Pay 8,106 8,443 8,514 8,302 Other 2,278 — 2,953 — Less: Reinsurance 10,570 — 3,839 — Total, net of reinsurance 56,965 15,169 53,519 14,444 Accident & Health: Other 1,054 — 1,027 — Less: Reinsurance 3 — 3 — Total, net of reinsurance 1,051 — 1,024 — Total $ 58,016 15,169 54,543 14,444 The following table provides the weighted-average durations of the liability for future policy benefits. December 31, 2025 December 31, 2024 (In years) International Insurance Domestic Insurance International Insurance Domestic Insurance Permanent: Duration at original discount rate 8.1 17.2 7.9 16.9 Duration at current discount rate 8.0 16.1 8.0 16.5 Permanent Limited Pay: Duration at original discount rate 7.7 13.6 6.9 14.2 Duration at current discount rate 7.3 12.8 6.7 13.5 December 31, 2025 | 10-K 84 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table provides the weighted-average interest rates for the liability for future policy benefits. December 31, 2025 December 31, 2024 International Insurance Domestic Insurance International Insurance Domestic Insurance Permanent: Interest rate at original discount rate 4.81 % 4.95 % 4.86 % 5.03 % Interest rate at current discount rate 4.82 % 5.48 % 5.24 % 5.63 % Permanent Limited Pay: Interest rate at original discount rate 4.21 % 4.84 % 4.17 % 4.99 % Interest rate at current discount rate 4.85 % 5.44 % 5.21 % 5.62 % LIABILITY FOR POLICYHOLDERS’ ACCOUNT BALANCES The following table presents the policyholders' account balances by range of guaranteed minimum crediting rates and the related range of the difference, in basis points, between rates being credited and the respective guaranteed minimums. At Guaranteed Minimum 1 Basis Point-50 Basis Points Above 51 Basis Points-150 Basis Points Above Greater Than 150 Basis Points Above Total December 31, 2025 (In thousands) Range of Guaranteed Minimum Crediting Rates: 0.00 % - 1.49 % $ 886 — — 32,196 33,082 1.50 % - 2.99 % 3,937 182 6 37,659 41,784 3.00 % - 4.49 % 119,257 382 27,167 — 146,806 Greater or equal to 4.50 % 31,084 — — — 31,084 Total $ 155,164 564 27,173 69,855 252,756 At Guaranteed Minimum 1 Basis Point-50 Basis Points Above 51 Basis Points-150 Basis Points Above Greater Than 150 Basis Points Above Total December 31, 2024 (In thousands) Range of Guaranteed Minimum Crediting Rates: 0.00 % - 1.49 % $ 826 — — 34,741 35,567 1.50 % - 2.99 % 4,761 178 6 32,452 37,397 3.00 % - 4.49 % 102,478 369 18,977 — 121,824 Greater or equal to 4.50 % 31,371 — — — 31,371 Total $ 139,436 547 18,983 67,193 226,159 December 31, 2025 | 10-K 85 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following tables summarize balances of and changes in policyholders' account balances. December 31, 2025 (In thousands, except for %) Supplemental Contracts Without Life Contingencies Fixed Annuity Dividend Accumulations Premiums Paid in Advance Balance, beginning of year $ 60,414 88,080 47,768 29,897 Issuances 34,887 4,660 796 4,629 Premiums received 323 4,816 5,973 791 Interest credited 2,850 3,167 2,301 816 Less: Surrenders and withdrawals — 12,426 5,478 8,816 Benefit payments 12,692 — — — Balance, end of year $ 85,782 88,297 51,360 27,317 Weighted-average crediting rates 4.10 % 3.97 % 3.90 % 3.25 % Cash surrender value $ 85,782 88,297 51,360 27,317 December 31, 2024 (In thousands, except for %) Supplemental Contracts Without Life Contingencies Fixed Annuity Dividend Accumulations Premiums Paid in Advance Balance, beginning of year $ 44,569 87,134 44,960 31,039 Issuances 24,241 3,263 779 5,820 Premiums received 438 4,201 5,703 778 Interest credited 2,031 2,790 1,827 800 Other 5 — — — Less: Surrenders and withdrawals — 9,308 5,501 8,540 Benefit payments 10,870 — — — Balance, end of year $ 60,414 88,080 47,768 29,897 Weighted-average crediting rates 4.01 % 3.73 % 3.58 % 3.02 % Cash surrender value $ 60,414 88,080 47,768 29,897 December 31, 2025 | 10-K 86 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table reconciles policyholders' account balances shown above to the policyholders' account balance liability in the consolidated balance sheets. As of December 31, (In thousands) 2025 2024 Annuities: Supplemental contracts without life contingencies $ 85,782 60,414 Fixed annuity 88,297 88,080 Unearned revenue reserve 1,490 1,483 Total annuities $ 175,569 149,977 Premiums paid in advance: Premiums paid in advance $ 27,317 29,897 Other 1,738 1,285 Total premiums paid in advance $ 29,055 31,182 (6) POLICY CLAIM LIABILITY The following table presents information on changes in the liability for policy and contract claims. December 31, (In thousands) 2025 2024 Balance at January 1, $ 8,822 6,637 Less: reinsurance recoverable 923 1,298 Net balance at January 1, 7,899 5,339 Add claims incurred, related to: Current year 24,864 26,781 Prior years (1) ( 1,343 ) ( 552 ) 23,521 26,229 Deduct claims paid, related to: Current year 17,641 19,189 Prior years 6,166 4,480 23,807 23,669 Net balance December 31, 7,613 7,899 Plus: reinsurance recoverable 1,159 923 Balance at December 31, $ 8,772 8,822 (1) This line is primarily impacted by the level of claim resolutions in the period compared to that which is expected by the reserve assumption. A positive number implies an unfavorable result where claim resolutions were less favorable than assumed while a negative number implies a favorable result compared to assumptions. Our claim assumptions will vary from actual experience in any one period, either favorably or unfavorably. (7) REINSURANCE In the normal course of business, the Company reinsures portions of certain policies that we underwrite to mitigate exposure to potential losses and/or to provide additional capacity for growth. In our international business, prior to April 1, 2025, we retained up to $ 100,000 on any one individual life insurance policy and reinsured the death benefit amounts above this amount. For new policies beginning on such date, we increased our retention amount to $ 250,000 and reinsure amounts above that. We also reinsure 100 % of our accidental death benefit rider coverage. In the second quarter of 2024, CLOA entered into a coinsurance agreement with RGA Reinsurance Company ("RGA"). Under this agreement, CLOA initially elected for RGA to reinsure 50 % of its newly written final expense December 31, 2025 | 10-K 87 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) business. The Company remains contingently liable in the event that any of the reinsurers are unable to meet their obligations under any reinsurance agreement. Our amounts recoverable from reinsurers represent receivables from and reserves ceded to reinsurers. We obtain reinsurance from multiple reinsurers and monitor our reinsurance concentration as well as the financial strength ratings of our reinsurers. Their ratings by A.M. Best Company range from A- (Excellent) to A+ (Superior). A summary of insurance in force, along with assumed and ceded life reinsurance activity, is summarized below as of the periods indicated. December 31, (In thousands) 2025 2024 Insurance in force: Direct life insurance in force $ 5,431,721 5,227,506 Aggregate assumed life insurance in force 3,193 3,427 Aggregate ceded life insurance in force ( 910,226 ) ( 821,215 ) Net life insurance in force $ 4,524,688 4,409,718 The Company's reinsurance recoverable on ceded reinsurance was $ 10.9 million and $ 6.9 million in 2025 and 2024, respectively. Premiums, claims and surrenders assumed and ceded and expenses ceded for all lines of business are summarized for the periods indicated below. Years ended December 31, (In thousands) 2025 2024 Premiums from short duration contracts: Direct $ 1,761 1,837 Ceded ( 3 ) ( 16 ) Net premiums earned 1,758 1,821 Premiums from long duration contracts: Direct 187,005 176,999 Assumed 51 67 Ceded ( 12,443 ) ( 5,559 ) Net premiums earned 174,613 171,507 Total premiums earned $ 176,371 173,328 Claims and surrenders assumed $ 103 122 Claims and surrenders ceded $ ( 1,789 ) ( 2,341 ) Commissions assumed and (ceded) $ ( 12,135 ) ( 5,539 ) Other general expenses ceded $ ( 2,712 ) ( 960 ) (8) COMMITMENTS AND CONTINGENCIES LITIGATION AND REGULATORY ACTIONS From time to time, we are subject to legal and regulatory actions relating to our business. We may incur defense costs, including attorneys' fees, and other direct litigation costs associated with defending claims. If we suffer an adverse judgment as a result of litigation claims, it could have a material adverse effect on our business, results of operations and financial condition. The Company's policy is to accrue for defense costs as those services are provided. December 31, 2025 | 10-K 88 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Trade Secret Lawsuit In the first quarter of 2024, a jury trial was held in the “trade secret lawsuit”. The trade secret lawsuit was filed in 2018 by Citizens, CICA Life Ltd. (CICA Bermuda) and CICA Life Insurance Company of America (CLOA) (collectively, the “Citizens Companies,” “we,” "us" or "our") against certain former employees and independent consultants who we alleged unlawfully took Citizens’ confidential information in order to unfairly compete with us. Our claims against these parties included various unfair competition, tortious interference, breach of contract and other related claims. As previously disclosed, the jury found that Citizens should pay Alexis Delgado and Carlos Nalsen Landa, former independent consultants, approximately $ 1.3 million for “money had and received”, an equitable theory that claimed that the Citizens Companies would be unjustly enriched if they didn’t pay past and future commissions to Delgado and Landa. Additionally, the trial court awarded defendants Michael P. Buchweitz and Randall Riley approximately $ 3.5 million of their legal fees incurred during the trade secret lawsuit. On August 16, 2024, the judge signed a Final Judgment reflecting the jury decision and the court award of the legal fees. We do not believe the jury properly found that Delgado or Landa were entitled to any prior or future commissions as there was no evidence that we actually held any amount of commissions that they claim they should have received. We also do not believe that Riley or Buchweitz are entitled to legal fees because they were found to have breached the contracts whose fee shifting provisions they sought to invoke. Both of these judgments have been accrued pending the result of our appeal. On September 17, 2024, we filed an appeal bond with the trial court in order to stay any execution of the judgment against us. We have appealed the judgment against us and the appeal is currently pending in the Court of Appeals, Third District of Texas. CREDIT FACILITY On May 3, 2024 , the Company renewed its $ 20 million senior secured revolving credit facility (the “Credit Facility”) with Regions Bank ("Regions"). The Credit Facility has a three-year term, maturing on May 5, 2027 , and allows the Company to borrow up to $ 20 million for working capital purposes, capital expenditures and other corporate purposes. Revolving loans may be requested by the Company in aggregate minimum principal amounts of $ 0.5 million per loan. At the Company's election, the revolving loans may either bear a rate (a fluctuating rate per annum) equal to the greatest of (a) Regions' prime rate, (b) the federal funds rate plus 50.00 %, (c) the index rate plus 1.00 % or (d) 0.75 %. The Company is required to pay Regions a quarterly commitment fee of 0.375 % of the unused portion of the Credit Facility, which the Company expenses as it is incurred. Obligations under the Credit Facility are secured by substantially all of the assets of the Company other than the equity interests in its subsidiaries, real estate owned by the Company, and other limited exceptions. 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 December 31, 2025, the Company had no t borrowed any funds against the Credit Facility and was not in violation of any covenants. CONTRACTUAL OBLIGATIONS The Company leases home office space in Austin, Texas for Citizens and in Puerto Rico for NES as well as several district office locations across Louisiana, Mississippi and Arkansas, for SPLIC which are classified as operating leases. Certain operating leases include renewal options that extend the lease term. The exercise of lease renewal options is at our sole discretion when it is reasonably certain that we will exercise such option. Leases with an initial term of 12 months or less are immaterial to the consolidated financial statements and are recognized as lease expense on a straight-line basis over the lease term and not recorded on the consolidated balance sheets. Our operating lease liabilities had a weighted-average lease term of 4.9 years remaining as of December 31, 2025. December 31, 2025 | 10-K 89 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Maturities of our remaining operating lease liabilities as of December 31, 2025 are as follows. (In thousands) Operating Lease Payments Maturity of operating lease liabilities: 2026 $ 1,602 2027 1,621 2028 1,630 2029 1,630 2030 1,385 Total operating lease liabilities 7,868 Interest expense ( 509 ) Present value of operating lease liabilities $ 7,359 We record the lease right-of-use asset in Property and Equipment, Net and the lease liability in Other Liabilities using a weighted average discount rate of 2.74 %. Cash payments related to the operating lease liabilities were $ 1.5 million for the years ended December 31, 2025 and 2024 and were reported in operating cash flows. The Company does not engage in lease agreements among related parties. As of December 31, 2025, we are committed to fund investments up to $ 10.9 million related to limited partnership and structured note investments previously described. (9) STOCKHOLDERS' EQUITY AND RESTRICTIONS STOCK Our Restated and Amended Articles of Incorporation authorize the issuance of 127,000,000 shares, of which 100,000,000 shares shall be Class A common stock, 2,000,000 shares shall be Class B common stock, and 25,000,000 shall be preferred stock. Both authorized classes of common stock are equal in all respects, except (a) each share of Class A common stock is entitled to receive twice the cash dividends paid on a per share basis to the Class B common stock, if any; and (b) the holders of the Class B common stock have the exclusive right to elect a simple majority of the Board of Directors of Citizens. Citizens currently has no outstanding preferred stock or Class B common stock. A summary of the change in the number of shares of Class A common stock and treasury stock issued is as follows: (In thousands) Common Stock Treasury Class A Stock Balance at December 31, 2023 53,883 5,330 Stock issued for compensation 352 — Balance at December 31, 2024 54,235 5,330 Stock issued for compensation 391 — Balance at December 31, 2025 54,626 5,330 December 31, 2025 | 10-K 90 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) EARNINGS PER SHARE The following table sets forth the computation of basic and diluted earnings per share. Years ended December 31, (In thousands, except per share amounts) 2025 2024 Basic and diluted earnings per share: Numerator: Net income $ 14,591 14,912 Net income allocated to Class A common stock $ 14,591 14,912 Denominator: Weighted average shares of Class A outstanding - basic 50,145 49,738 Weighted average shares of Class A outstanding - diluted 51,456 50,748 Basic earnings per share of Class A common stock $ 0.29 0.30 Diluted earnings per share of Class A common stock $ 0.28 0.29 STATUTORY CAPITAL AND SURPLUS The combined total of all of our domestic insurance subsidiaries' statutory capital and surplus was $ 24.8 million and $ 28.8 million for as of December 31, 2025 and 2024, respectively. The combined total for all of our domestic insurance subsidiaries' statutory net income are shown in the table below, although these amounts are not all available as dividends to Citizens since CLOA is the only subsidiary directly owned by Citizens. All other domestic subsidiaries are owned by CLOA. SPFIC, our property insurance subsidiary, was dissolved during 2024. Years ended December 31, (In thousands) 2025 2024 Combined statutory net income (loss): Life insurance operations $ ( 4,694 ) ( 9,996 ) Property insurance operations — ( 294 ) Total combined statutory net income (loss) $ ( 4,694 ) ( 10,290 ) Generally, the net assets of the domestic insurance subsidiaries available for transfer to their immediate parent are limited to the lesser of the subsidiary's net gain from operations during the preceding year or 10 % of the subsidiary's net statutory surplus as of the end of the preceding year as determined in accordance with accounting practices prescribed or permitted by insurance regulatory authorities. Under these practices, total surplus at December 31, 2025 was $ 21.7 million and net loss from operations was $ 5.5 million for CLOA for the year ended December 31, 2025. Based upon these amounts, no dividend could be paid to the Company without prior regulatory approval in 2026. Payments of dividends in excess of such amounts would generally require approval by regulatory authorities. Our domestic insurance subsidiaries have calculated their risk-based capital ("RBC") in accordance with the National Association of Insurance Commissioners' ("NAIC") Model Rule and the RBC rules as adopted by their respective states of domicile. All domestic insurance subsidiaries exceeded the minimum capital requirements at December 31, 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 CLOA's RBC remains above 350%. As CLOA's RBC exceeded 350% at December 31, 2025, no capital contribution was necessary. CICA International is a Puerto Rico domiciled company. The Insurance Code of Puerto Rico does not specifically set forth minimum capital and surplus standards, but rather requires that an insurer submit a business plan for approval to the Office of the Commissioner of Insurance ("OIC") that includes proposed minimum capital and surplus. CICA December 31, 2025 | 10-K 91 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) International is required to maintain a minimum of $750,000 in capital and maintain a premium to surplus ratio of 7 to 1. CICA International's capital exceeds both of the required minimum capital and related ratio. As of and for the years ended December 31, (In thousands) 2025 2024 CICA International: Capital and surplus $ 101,470 91,513 Net income $ 9,901 18,871 As stated above, CICA International exceeded both of the capital and surplus metrics established by the OIC. CICA International could pay up to $ 0.5 million in dividends during 2026 without regulatory approval. (10) SEGMENT AND OTHER OPERATING INFORMATION Explanation of Recast Data Due to Segment Reorganization As discussed in Note 1 . Summary of Significant Accounting Policies , effective December 31, 2025, the Company reorganized its insurance reporting structure, shifting from Life Insurance and Home Service Insurance segments to Domestic Insurance and International Insurance segments. As a result of this reorganization, comparative prior periods presented have been recast to conform to the current year presentation. Recasting involves restating prior period segment information as if the new segment definitions had been in place during those periods. This allows for meaningful comparisons across periods and provides stakeholders with a consistent view of segment performance over time. The reorganization of our operating segments had no impact on our previously reported consolidated results of operations, financial condition, or cash flows. Segment Information The Company's segments are defined by management's reporting structure and operating activities. The chief operating decision maker ("CODM"), our President and Chief Executive Officer, reviews and analyzes income statement information by segment to make decisions, assess financial performance and allocate resources across the Company in order to meet the overall strategic objectives of the Company. The Company has two reportable segments: International Insurance and Domestic Insurance. Our International Insurance segment issues endowment contracts, which are principally accumulation contracts that incorporate an element of life insurance protection, and whole life insurance to non-U.S. residents through CICA International. These contracts are designed to provide a fixed amount of insurance coverage over the life of the insured and may utilize rider benefits to provide additional coverage and annuity benefits to enhance accumulations. Our Domestic Insurance segment operates through our subsidiaries CLOA, which issues whole life, final expense and life products with living benefits throughout the U.S., and SPLIC and MGLIC, which focus on the life insurance needs of the lower-income markets, primarily in Louisiana, Mississippi and Arkansas. SPLIC also issues critical illness policies. Our policies are sold and serviced through independent agents. SPFIC sold property insurance policies in Louisiana and Arkansas until operations were ceased effective June 30, 2023. SPFIC was dissolved during 2024. The International Insurance and Domestic Insurance portions of the Company constitute separate businesses. In addition to the International Insurance and Domestic 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. The accounting policies of the reportable segments and Other Non-Insurance Enterprises are presented in accordance with U.S. GAAP and are the same as those described in the summary of significant accounting policies. The CODM evaluates profit and loss performance based on U.S. GAAP net income (loss) before federal income taxes for its two reportable segments. The Company's Other Non-Insurance Enterprises represents the only reportable difference between segments and consolidated operations. December 31, 2025 | 10-K 92 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Year ended December 31, 2025 (In thousands) International Insurance Domestic Insurance Other Non-Insurance Enterprises Consolidated Revenues: Premiums $ 118,355 58,016 — 176,371 Net investment income (loss) 50,869 20,420 750 72,039 Investment related gains (losses), net ( 478 ) 587 31 140 Other income (loss) 6,913 28 125 7,066 Total revenues 175,659 79,051 906 255,616 Benefits and expenses: Insurance benefits paid or provided: Claims and surrenders 139,017 26,008 — 165,025 Increase in future policy benefit reserves ( 27,310 ) 12,453 — ( 14,857 ) Policyholder liability remeasurement (gain) loss 7,175 ( 4,602 ) — 2,573 Policyholders' dividends 5,214 336 — 5,550 Total insurance benefits paid or provided 124,096 34,195 — 158,291 Commissions 22,381 24,884 — 47,265 Other general expenses 22,154 20,936 9,951 53,041 Capitalization of deferred policy acquisition costs ( 21,371 ) ( 18,430 ) — ( 39,801 ) Amortization of deferred policy acquisition costs 14,017 4,882 — 18,899 Amortization of cost of insurance acquired — 451 — 451 Total benefits and expenses 161,277 66,918 9,951 238,146 Income (loss) before federal income tax $ 14,382 12,133 ( 9,045 ) 17,470 December 31, 2025 | 10-K 93 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Year ended December 31, 2024 (In thousands) International Insurance Domestic Insurance Other Non-Insurance Enterprises Consolidated Revenues: Premiums $ 118,803 54,525 — 173,328 Net investment income (loss) 49,174 19,654 884 69,712 Investment related gains (losses), net ( 1,929 ) ( 680 ) ( 17 ) ( 2,626 ) Other income (loss) 4,534 ( 30 ) 83 4,587 Total revenues 170,582 73,469 950 245,001 Benefits and expenses: Insurance benefits paid or provided: Claims and surrenders 117,730 28,352 — 146,082 Increase in future policy benefit reserves ( 15,364 ) 11,078 — ( 4,286 ) Policyholder liability remeasurement (gain) loss 4,400 356 — 4,756 Policyholders' dividends 4,891 464 — 5,355 Total insurance benefits paid or provided 111,657 40,250 — 151,907 Commissions 22,333 26,785 — 49,118 Other general expenses 20,818 20,052 11,396 52,266 Capitalization of deferred policy acquisition costs ( 21,232 ) ( 20,070 ) — ( 41,302 ) Amortization of deferred policy acquisition costs 13,494 3,941 — 17,435 Amortization of cost of insurance acquired — 597 — 597 Total benefits and expenses 147,070 71,555 11,396 230,021 Income (loss) before federal income tax $ 23,512 1,914 ( 10,446 ) 14,980 The Company categorizes premiums in two categories - first year premiums are premiums received within the first 12 months of a policy's issuance and any premiums received thereafter are renewal premiums. A summary of the direct premiums for the International Insurance segment is detailed below. Years ended December 31, (In thousands) International Insurance Segment 2025 2024 Direct premiums: First year $ 16,231 15,104 Renewal 103,946 105,352 Total direct premiums 120,177 120,456 Reinsurance ( 1,822 ) ( 1,653 ) Total premiums $ 118,355 118,803 December 31, 2025 | 10-K 94 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) A summary of the Domestic Insurance segment direct life and A&H premium breakout is detailed below. Years ended December 31, (In thousands) Domestic Insurance Segment 2025 2024 Direct life and A&H premiums: First year $ 22,061 17,918 Renewal 46,528 40,467 Total direct life and A&H premiums 68,589 58,385 Reinsurance ( 10,573 ) ( 3,842 ) Total life and A&H premiums $ 58,016 54,543 The table below summarizes assets by segment. December 31, (In thousands) 2025 2024 Assets: Segments: International Insurance $ 1,190,736 1,151,562 Domestic Insurance 529,357 498,526 Total Segments 1,720,093 1,650,088 Other Non-Insurance Enterprises 34,667 35,237 Total assets $ 1,754,760 1,685,325 GEOGRAPHIC INFORMATION The following table sets forth the Company's annual total of earned premiums by country of policyholder residence for the years indicated. Years ended December 31, (In thousands) 2025 2024 Area: United States $ 69,019 58,468 Colombia 28,115 25,727 Taiwan 14,359 16,690 Ecuador 13,550 13,159 Venezuela 13,322 14,305 Argentina 11,758 10,319 Other foreign countries 39,367 39,317 Reinsurance and change in premium accruals ( 13,119 ) ( 4,657 ) Total premiums $ 176,371 173,328 (11) INCOME TAXES CICA International is considered a controlled foreign corporation for federal income tax purposes. As a result, the insurance activity of CICA International is subject to Subpart F of the Internal Revenue Code ("IRC") and is included in Citizens’ taxable income. The Government of Puerto Rico approved a tax exemption decree for CICA International which freezes the income tax rate at 0 % on taxable earnings up to $ 1.2 million and 4 % on any taxable earnings in excess of $ 1.2 million for a minimum of 15 years. December 31, 2025 | 10-K 95 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) A summary of the income (loss) before federal income tax expense, by jurisdiction, is as follows: Years ended December 31, (In thousands) 2025 2024 Income (loss) before federal income tax: United States $ 7,425 ( 4,317 ) Puerto Rico 10,045 19,297 Total income before federal income tax $ 17,470 14,980 Federal income tax expense (benefit) consists of: Years ended December 31, (In thousands) 2025 2024 Current income tax expense (benefit) related to: United States $ — 286 Puerto Rico 1,412 1,582 Total current income tax expense 1,412 1,868 Deferred income tax expense (benefit) related to: United States 2,477 ( 908 ) Puerto Rico ( 1,010 ) ( 892 ) Total deferred income tax expense (benefit) 1,467 ( 1,800 ) Total federal income tax expense (benefit) $ 2,879 68 A reconciliation between the U.S. corporate income tax rate and the effective income tax rate is as follows: Years ended December 31, (In thousands, except for %) 2025 % 2024 % Expected federal income tax expense (benefit): $ 3,669 21.0 % $ 3,146 21.0 % Foreign tax effects: Puerto Rico: Statutory tax rate difference between Puerto Rico and United States ( 1,708 ) ( 9.7 ) ( 3,280 ) ( 21.9 ) Income tax exclusion ( 48 ) ( 0.3 ) ( 48 ) ( 0.3 ) Other 48 0.3 ( 35 ) ( 0.2 ) Effect of cross-border tax laws: Subpart F inclusions 135 0.8 ( 524 ) ( 3.5 ) PFIC QEF inclusions 688 3.9 800 5.3 Other 1 — 2 — Nontaxable or nondeductible items: Tax-exempt interest and dividends-received deduction ( 15 ) ( 0.1 ) ( 23 ) ( 0.1 ) Compensation limitation under Section 162(m) & 280(g) 75 0.4 ( 2 ) — Other 34 0.2 52 0.3 Other — — ( 20 ) ( 0.1 ) Total federal income tax expense (benefit) $ 2,879 16.5 % $ 68 0.5 % December 31, 2025 | 10-K 96 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) A summary of the total federal income tax payments made and refunds received by jurisdiction is as follows: Years ended December 31, (In thousands) 2025 2024 Tax payments (refunds) United States $ ( 519 ) ( 828 ) Puerto Rico 2,406 1,300 Total tax payments $ 1,887 472 The components of deferred federal income taxes are as follows: December 31, (In thousands) 2025 2024 Deferred tax assets: Net operating and capital loss carryforwards $ 2,136 1,774 Accrued policyholder dividends and expenses 222 200 Deferred intercompany loss 1,432 1,721 Unrealized losses on investments available-for-sale 12,555 15,816 Accrued compensation 584 745 Lease liability 1,542 1,628 Fixed assets 328 394 Other 1,104 1,065 Total gross deferred tax assets 19,903 23,343 Less: Valuation allowance 4,324 5,073 Net deferred tax assets 15,579 18,270 Deferred tax liabilities: DAC, COIA and intangible assets ( 17,161 ) ( 14,619 ) Future policy benefit reserves ( 2,388 ) ( 4,363 ) Investments ( 379 ) ( 316 ) Tax reserves transition liability — ( 747 ) Right-of-use lease asset ( 1,542 ) ( 1,628 ) Other ( 105 ) ( 39 ) Total gross deferred tax liabilities ( 21,575 ) ( 21,712 ) Net deferred tax liability $ ( 5,996 ) ( 3,442 ) A summary of changes in the components of deferred federal and state income taxes is as follows: December 31, (In thousands) 2025 2024 Balance at January 1, $ ( 3,442 ) ( 1,102 ) Deferred tax benefit (expense) ( 1,467 ) 1,800 Investments available-for-sale ( 3,241 ) 3,031 Change in valuation allowance 749 ( 605 ) Effects of unrealized gains (losses) on reserves 1,405 ( 6,566 ) Balance at December 31, $ ( 5,996 ) ( 3,442 ) December 31, 2025 | 10-K 97 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company and our subsidiaries have $ 7.1 million in net operating loss carryforwards in the U.S. at December 31, 2025. The Company and our subsidiaries have capital loss carryforwards of $ 2.9 million in the U.S. and $ 0.2 million in Puerto Rico at December 31, 2025, which begin expiring in 2026 and 2031, respectively. At December 31, 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. Thus, the Company holds valuation allowances of $ 4.3 million and $ 5.1 million in other comprehensive income (loss) at December 31, 2025 and 2024, respectively. The Company recognizes only the impact of tax positions that, based on their technical merits, are more likely than not to be sustained upon an audit by the taxing authority. The Company does not have any unrecognized tax benefits for December 31, 2025 and 2024. The Company’s practice is to recognize interest and penalties related to income tax matters in income tax expense. In the consolidated statements of operations and comprehensive income (loss), we received $ 0.1 million of interest income related to refunds for the year ended December 31, 2025 and none in 2024. On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The Company had an immaterial impact to our income tax expense or effective tax rate for the enactment of OBBBA for the year ended December 31, 2025. The Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was enacted on March 27, 2020 in response to the COVID-19 pandemic. The CARES Act, among other things, permitted net operating losses incurred in 2018, 2019 and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes. The Company's federal income tax return is filed on a consolidated basis with the following entities: Citizens, Inc. CICA Life Insurance Company of America Magnolia Guaranty Life Insurance Company Security Plan Life Insurance Company Computing Technology, Inc. The method of tax allocation among companies is subject to a written tax sharing agreement, approved by the Board of Directors, whereby allocation is made primarily on a separate return basis pursuant to the wait-and-see method. Under this method, consolidated group members are not given current credit or refunds for net operating losses until taxable income on a separate return basis is generated. Intercompany tax balances are settled at least annually. The Company and our subsidiaries file income tax returns in the U.S. federal jurisdiction and various U.S. states. Our subsidiaries are subject to examination by U.S. tax authorities for tax years ending after December 31, 2022. The Company's Puerto Rico subsidiaries are subject to examination by Puerto Rico tax authorities for tax years ending after December 31, 2022. (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 twelve months ended December 31, December 31, 2025 | 10-K 98 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 2025 and 2024. The following table provides a rollforward of accumulated other comprehensive income (loss) for the periods indicated below. (In thousands) Unrealized Gains and Losses on Available for Sale Securities Discount Rate for Liability for Future Policy Benefits Other Comprehensive Income (Loss) Balance at December 31, 2023, net of tax $ ( 141,741 ) 23,586 ( 118,155 ) Other comprehensive income (loss) before reclassification, before tax ( 30,982 ) 56,613 25,631 Amounts reclassified from other comprehensive income (loss), before tax 699 — 699 Income tax benefit (expense) 2,425 ( 6,565 ) ( 4,140 ) Balance at December 31, 2024, net of tax ( 169,599 ) 73,634 ( 95,965 ) Other comprehensive income (loss) before reclassification, before tax 36,097 ( 27,117 ) 8,980 Amounts reclassified from other comprehensive income (loss), before tax ( 349 ) — ( 349 ) Income tax benefit (expense) ( 2,493 ) 1,406 ( 1,087 ) Balance at December 31, 2025, net of tax $ ( 136,344 ) 47,923 ( 88,421 ) (13) STOCK COMPENSATION Citizens grants stock-based compensation in the form of restricted stock units ("RSUs") and beginning in 2024, performance share units ("PSUs"). All stock awards are granted pursuant to the Citizens, Inc. Omnibus Incentive Plan (the "Plan"), which was approved by our shareholders in 2017. There were 3,000,000 shares authorized to be granted under the Plan. Awards may be granted under the Plan until June 5, 2027 . Restricted Stock Units. RSUs consist of time-vested grants and give the grantee the right to receive one share of our Class A common stock in the future for each RSU granted, subject to certain restrictions and a risk of forfeiture. For non-employee directors, RSUs are granted annually on the date of the annual shareholders meeting and vest one year from the date of grant, subject to continued service on the Board. Employee RSU grants vest over three years , subject to continued employment (except in the case of retirement, death or disability). The following table provides a rollforward of RSU activity for the two-year period ended December 31, 2025. Restricted Stock Units Units (In thousands) Weighted Average Grant Date Fair Value Outstanding at December 31, 2023 574 $ 3.37 Granted 892 2.29 Less: Vested 433 2.73 Forfeited 17 2.84 Outstanding at December 31, 2024 1,016 2.70 Granted 381 4.33 Less: Vested 471 4.48 Forfeited 14 3.14 Outstanding at December 31, 2025 912 $ 3.08 December 31, 2025 | 10-K 99 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) In 2025, we recognized compensation expense of $ 2.5 million and $ 1.4 million in 2025 and 2024, respectively, related to RSU awards that were granted and vested during these periods. The aggregate intrinsic value of RSUs vested during the years ended December 31, 2025 and 2024 was $ 2.1 million and $ 1.2 million, respectively. As of December 31, 2025, unrecognized compensation costs for RSU awards was $ 1.8 million and is expected to be amortized over two years . Performance Share Units. The Board of Directors granted PSUs to a limited number of senior executives in 2024 and 2025. PSUs have a three-year performance period and give the grantee the right to receive one share of our Class A common stock in the future for each PSU granted, subject to certain restrictions and a risk of forfeiture. While the PSU grant specifies a stated target number of shares, the grantees can earn up to 200 % of the target PSUs awarded based on the achievement of the Board approved metric over the performance period. PSUs are not settled in shares until the Board certifies that the approved performance metrics have been met. Employees must continue to be employed during the performance period in order to receive shares, except in the case of death or disability, change in control, retirement (settled pro-rata) or certain involuntary terminations (settled pro-rata). The following table provides a rollforward of PSU activity for the period beginning on the first date of grant and ending on December 31, 2025. Performance Stock Units Units (In thousands) Weighted Average Grant Date Fair Value Outstanding at March 28, 2024 — $ — Granted 333 2.14 Less: Forfeited 83 2.14 Outstanding at December 31, 2024 250 2.14 Granted 143 4.55 Less: Forfeited 15 3.73 Outstanding at December 31, 2025 378 (1) $ 2.99 (1) Represents the base number of PSUs that may vest. The actual number of PSUs that vest will be between 0 and 0.6 million, depending on the Company's achievement of certain performance goals. We recognized $ 0.3 million and $ 0.1 million of expense for the PSU grants in 2025 and 2024, respectively, while $ 0.5 million was unrecognized and is expected to be amortized over the next one to three years depending on the vesting schedule of the grants. The vesting of PSUs occurs after a three-year performance period, and the actual quantity of shares awarded is determined by how well the Company fulfills established performance goals. As of December 31, 2025, management estimates that the probability of achieving the performance targets was 50 % for the shares granted in 2024 and 100 % for shares granted in 2025. (14) BENEFIT PLANS The Company sponsors a defined contribution retirement plan. The plan was initially established as the Citizens, Inc. Profit Sharing Plan and was restated as the Citizens, Inc. 401(k) Retirement and Profit Sharing Plan effective March 1, 2016. There have been no profit sharing contributions since 2014. The 401(k) plan automatically enrolls employees who have completed three months of service. Voluntary contributions are made by employees and the Company provides a matching contribution based upon the employee's level of contribution. The Company's expense was $ 0.8 million in both 2025 and 2024. (15) 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. We perform an expense study on an annual basis, utilizing an enterprise-wide time study, and we adjust cost allocations among entities as needed based upon this review. Any December 31, 2025 | 10-K 100 Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) allocation changes are reflected in the segment operations, but do not impact consolidated expenses. There were no changes related to these relationships during the year ended December 31, 2025 and no additional related party transactions. (16) QUARTERLY FINANCIAL INFORMATION (Unaudited) The following table contains selected unaudited financial data for each quarter. (In thousands, except per share amounts) Fourth Quarter Third Quarter Second Quarter First Quarter 2025 Revenues $ 72,070 62,808 65,086 55,652 Benefits and expenses 64,206 58,329 58,172 57,439 Federal income tax expense (benefit) 526 2,062 455 ( 164 ) Net income (loss) 7,338 2,417 6,459 ( 1,623 ) Net income (loss) available to common shareholders 7,338 2,417 6,459 ( 1,623 ) Basic earnings (loss) per share of Class A common stock 0.15 0.04 0.13 ( 0.03 ) Diluted earnings (loss) per share of Class A common stock 0.14 0.04 0.13 ( 0.03 ) 2024 Revenues $ 63,474 61,731 62,084 57,712 Benefits and expenses 59,758 58,694 58,782 52,787 Federal income tax expense (benefit) 95 247 ( 657 ) 383 Net income 3,621 2,790 3,959 4,542 Net income available to common shareholders 3,621 2,790 3,959 4,542 Basic earnings per share of Class A common stock 0.07 0.06 0.08 0.09 Diluted earnings per share of Class A common stock 0.07 0.05 0.08 0.09 (17) SUBSEQUENT EVENTS 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 subsequent events need to be recognized or disclosed. December 31, 2025 | 10-K 101 Table of Contents CITIZENS, INC. FINANCIAL SCHEDULES Schedule II Condensed Financial Information of Registrant CITIZENS, INC. (Parent Company) Balance Sheets December 31, (In thousands) 2025 2024 Assets: Investment in subsidiaries (1) $ 213,359 188,678 Fixed maturity securities, available-for-sale, at fair value 16,295 16,331 Equity securities, at fair value 178 21 Cash (restricted portion: $ 1,554 in 2025 and 2024) 5,658 4,272 Accrued investment income 159 197 Accounts receivable from subsidiaries (1) 3,604 4,292 Property and equipment, net 6,642 8,018 Other assets ( 63 ) 283 Total assets $ 245,832 222,092 Liabilities and Stockholders' Equity: Liabilities: Accrued expense and other liabilities $ 10,847 11,737 Total liabilities 10,847 11,737 Stockholders' equity: Common stock: Class A 272,294 269,799 Class B 3,184 3,184 Retained earnings 71,653 57,062 Unrealized investment gains (losses) on securities held by parent and subsidiaries, net of tax ( 88,421 ) ( 95,965 ) Treasury stock ( 23,725 ) ( 23,725 ) Total stockholders' equity 234,985 210,355 Total liabilities and stockholders' equity $ 245,832 222,092 (1) Eliminated in consolidation. Note to Schedule II : Citizens, Inc.'s investments in consolidated subsidiaries are stated at cost plus equity in undistributed income of consolidated subsidiaries and unrealized gains (losses) on investments held by consolidated subsidiaries. The Company includes in its statements of operations and comprehensive income (loss) dividends from its subsidiaries and equity in income (loss) of consolidated subsidiaries, which represents the net income (loss) of each of its wholly-owned subsidiaries. December 31, 2025 | 10-K 102 Table of Contents CITIZENS, INC. FINANCIAL SCHEDULES Schedule II, Continued Condensed Financial Information of Registrant CITIZENS, INC. (Parent Company) Statements of Operations and Comprehensive Income (Loss) Years ended December 31, (In thousands) 2025 2024 Comprehensive Income (Loss): Revenues: Management service fees (1) $ 44,824 41,636 Investment income 769 4,900 Other 125 83 Investment related gains (losses), net 31 ( 17 ) Total revenues 45,749 46,602 Expenses: General expenses 48,285 47,470 Taxes, licenses and fees 224 216 Total expenses 48,509 47,686 Income (loss) before equity in income (loss) of consolidated subsidiaries ( 2,760 ) ( 1,084 ) Equity in income of consolidated subsidiaries 17,351 15,996 Net income 14,591 14,912 Other comprehensive income (loss) 7,544 22,190 Total comprehensive income (loss) $ 22,135 37,102 (1) Eliminated in consolidation. Note to Schedule II : Citizens, Inc.'s investments in consolidated subsidiaries are stated at cost plus equity in undistributed income of consolidated subsidiaries and unrealized gains (losses) on investments held by consolidated subsidiaries. The Company includes in its statements of operations and comprehensive income (loss) dividends from its subsidiaries and equity in income (loss) of consolidated subsidiaries, which represents the net income (loss) of each of its wholly-owned subsidiaries. December 31, 2025 | 10-K 103 Table of Contents CITIZENS, INC. FINANCIAL SCHEDULES Schedule II, Continued Condensed Financial Information of Registrant CITIZENS, INC. (Parent Company) Statements of Cash Flows Years ended December 31, (In thousands) 2025 2024 Cash flows from operating activities: Net income $ 14,591 14,912 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Investment related gains (losses), net ( 31 ) 17 Equity in income of consolidated subsidiaries ( 17,351 ) ( 15,996 ) Change in accrued expenses and other liabilities 210 4,303 Change in federal income tax payable 519 828 Amortization of premiums and discounts on investments 54 81 Depreciation 219 243 Change in accrued investment income 38 32 Stock-based compensation 2,774 1,517 Decrease (increase) in receivable from subsidiaries and other assets 688 39 Other, net ( 222 ) ( 23 ) Net cash provided by (used in) operating activities 1,489 5,953 Cash flows from investing activities: Purchases of fixed maturity securities, available-for-sale ( 8,820 ) ( 5,066 ) Maturities and calls of fixed maturity securities, available-for-sale 4,671 9,989 Purchase of equity securities ( 120 ) — Sales of fixed maturity securities, available-for-sale 4,444 — Purchases of property and equipment — ( 106 ) Net cash provided by (used in) investing activities 175 4,817 Cash flows from financing activities: Capital contribution to subsidiary — ( 10,010 ) Other share repurchases ( 278 ) ( 393 ) Net cash provided by (used in) financing activities ( 278 ) ( 10,403 ) Net increase (decrease) in cash 1,386 367 Cash at beginning of year 4,272 3,905 Cash at end of year $ 5,658 4,272 Note to Schedule II : Citizens, Inc.'s investments in consolidated subsidiaries are stated at cost plus equity in undistributed income of consolidated subsidiaries and unrealized gains (losses) on investments held by consolidated subsidiaries. The Company includes in its statements of operations and comprehensive income (loss) dividends from its subsidiaries and equity in income (loss) of consolidated subsidiaries, which represents the net income (loss) of each of its wholly-owned subsidiaries. December 31, 2025 | 10-K 104 Table of Contents CITIZENS, INC. FINANCIAL SCHEDULES Schedule III Consolidated Supplementary Insurance Information Years ended December 31, (In thousands) 2025 2024 Deferred policy acquisition costs: International Insurance $ 133,038 125,684 Domestic Insurance 87,499 73,951 Total consolidated deferred policy acquisition costs $ 220,537 199,635 Future policy benefit reserves and policy claims payable: International Insurance $ 874,118 869,235 Domestic Insurance 324,081 312,692 Total consolidated future policy benefit reserves and policy claims payable $ 1,198,199 1,181,927 Unearned premiums: International Insurance $ 1,658 1,215 Domestic Insurance 57 57 Total consolidated unearned premiums $ 1,715 1,272 Other policy claims and benefits payable: International Insurance $ 187,003 159,682 Domestic Insurance 75,221 75,244 Total consolidated other policy claims and benefits payable $ 262,224 234,926 December 31, 2025 | 10-K 105 Table of Contents CITIZENS, INC. FINANCIAL SCHEDULES The Company's written premium is not materially different from earned premium, therefore only earned premiums are detailed in Schedule IV. Schedule IV Consolidated Statement of Reinsurance (In thousands) Direct Amount Ceded to Other Companies Assumed From Other Companies Net Amount % of Amount Assumed to Net Year ended December 31, 2025: Life insurance in force $ 5,431,721 910,226 3,193 4,524,688 0.1 % Premiums: Life insurance $ 187,003 12,443 51 174,611 Accident and health insurance 1,763 3 — 1,760 Total premiums $ 188,766 12,446 51 176,371 — % Year ended December 31, 2024: Life insurance in force $ 5,227,506 821,215 3,427 4,409,718 0.1 % Premiums: Life insurance $ 177,053 5,559 67 171,561 Accident and health insurance 1,788 3 — 1,785 Property insurance ( 5 ) 13 — ( 18 ) Total premiums $ 178,836 5,575 67 173,328 — % December 31, 2025 | 10-K 106 EXHIBITS Exhibit No. Description 3.1 Restated and Amended Articles of Incorporation dated March 4, 2004 (incorporated herein by reference to Exhibit 3.1 to the Registrant's Annual Report on Form 10-K for the Year Ended December 31, 2003, filed on March 15, 2004) 3.2 Amended and Restated Bylaws dated June 2, 2021 (incorporated herein by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, filed on June 7, 2021) 4.1* Description of Securities of Citizens, Inc. 10.1 Form of Indemnification Agreement for Executive Officers (incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed on November 8, 2017) 10.2 Form of Indemnification Agreement for Directors (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on November 8, 2017) 10.3† Citizens, Inc. Omnibus Incentive Plan (incorporated by reference to Exhibit 4.3 to the Registration Statement on Form S-8 filed by the Registrant on December 5, 2017) 10.4† Form of Citizens, Inc. Employee Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.6 to the Registrant's Annual Report on Form 10-K filed on March 29, 2018) 10.5† Form of Citizens, Inc. Executive Officer Performance Share Unit Agreement (incorporated by reference to Exhibit 10.5 to the Registrant's Annual Report on Form 10-K filed on March 13, 2025) 10.6† Form of Citizens, Inc. Non-employee Director Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.7 to the Registrant's Annual Report on Form 10-K filed on March 29, 2018) 10.9† Executive Employment Agreement by and between Citizens, Inc. and Jon Stenberg, entered into as of March 18, 2024 (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on March 18, 2024) 10.10 Credit Agreement between the Company and Regions Bank dated May 5, 2021 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed on August 4, 2021) 10.11 Pledge and Security Agreement dated May 5, 2021 by and between Citizens, Inc. as obligor, and Regions Bank, as lender (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed on August 4, 2021) 10.12 First Amendment to Credit Agreement between the Company and Regions Bank dated May 3, 2024 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed on August 6, 2024) 10.14† Compensation Recovery Policy (incorporated by reference to Exhibit 10.11 to the Registrant's Annual Report for the Year Ended December 31, 2023 on Form 10-K filed on March 14, 2024) 19 Citizens, Inc. Insider Trading Policy (incorporated by reference to Exhibit 19.1 to the Registrant's Annual Report on Form 10-K filed on March 13, 2025) 21* Subsidiaries of the Registrant 23* Consent of Independent Registered Public Accounting Firm - Grant Thornton LLP 24 Power of Attorney (included on signature page enclosed herein) 31.1* Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act 31.2* Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act 32.1* Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act 32.2* Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act December 31, 2025 | 10-K 107 Exhibit No. Description 101.INS XBRL Instance Document 101.SCH XBRL Taxonomy Extension Schema 101.CAL XBRL Taxonomy Extension Calculation Linkbase 101.DEF XBRL Taxonomy Extension Definition Linkbase 101.LAB XBRL Taxonomy Extension Label Linkbase 101.PRE XBRL Taxonomy Extension Presentation Linkbase 104 Inline XBRL for the cover page of this Annual Report on Form 10-K for the year ended December 31, 2025, filed electronically herewith, included in the Exhibit 101 Inline XBRL Document Set. † Indicates management contract or compensatory plan or arrangement. * Filed herewith. Item 16. FORM 10-K SUMMARY None. December 31, 2025 | 10-K 108 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized. CITIZENS, INC. Date: March 12, 2026 By: /s/ Jon Stenberg Jon Stenberg, Chief Executive Officer and President (Principal Executive Officer) By: /s/ Jeffery P. Conklin Jeffery P. Conklin, Vice President, Chief Financial Officer, Chief Investment Officer and Treasurer (Principal Financial and Accounting Officer) POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Jon Stenberg and Jeffery P. Conklin jointly and severally, his or her attorneys-in-fact, each with the power of substitution, for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated and on March 12, 2026. Dated: March 12, 2026 /s/ Jerry D. Davis, Jr. /s/ Cynthia H. Davis Jerry D. Davis, Jr., Chairman of the Board and Director Cynthia H. Davis, Vice Chairman of the Board and Director /s/ Christopher W. Claus /s/ Peter M. Carlson Christopher W. Claus, Director Peter M. Carlson, Director /s/ Dr. Terry S. Maness /s/ Mary Taylor Dr. Terry S. Maness, Director Mary Taylor, Director /s/ J. Keith Morgan /s/ Michael Harwood J. Keith Morgan, Director Michael Harwood, Director /s/ Jon Stenberg Jon Stenberg, Director December 31, 2025 | 10-K 109