What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2024-03-29 compared with 2023-03-31 · 107 added, 261 removed, 250 unchanged (60% of the section changed)

30 unchanged sentences

Menlo Life Insurance Company (1999), Acadian Life Insurance Company (2002), Paramount Security Life Insurance Company (2004), Memorial

Insurance Company of America (2005), Capital Reserve Life Insurance Company (2007), Southern Security Life Insurance Company, Inc.

North America Life Insurance Company (2011, 2015), Trans-Western Life Insurance Company (2012), Mothe Life Insurance Company (2012),

DLE Life Insurance Company (2012), American Republic Insurance Company (2015), First Guaranty Insurance Company (2016), and Kilpatrick

Life Insurance Company (2019).

In August 2021, the Company sold Memorial Insurance Company of America.

Insurance Company of America (2005 and subsequently sold in 2021 to FOXO Life Insurance Company), Capital Reserve Life Insurance Company

(2007), Southern Security Life Insurance Company, Inc.

(2008), North America Life Insurance Company (2011, 2015), Trans-Western Life

Insurance Company (2012), Mothe Life Insurance Company (2012), DLE Life Insurance Company (2012), American Republic Insurance Company

(2015), First Guaranty Insurance Company (2016), Kilpatrick Life Insurance Company (2019), and merger with FOXO Life Insurance Company

cemetery and mortuary operations have also grown through the acquisition of other cemetery and mortuary companies.

9 unchanged sentences

mortgage loans.

In 2012, the Company formed Green Street Mortgage Services, Inc.

(now known as EverLEND Mortgage Company) (“EverLEND

Mortgage”) also to originate and refinance residential mortgage loans.

In December 2021, the Company ceased operations in EverLEND

Mortgage and merged its operations into SecurityNational Mortgage.

Note 15 of the Notes to Consolidated Financial Statements for additional information regarding business segments of the Company.

Note 15 of the Notes to Consolidated Financial Statements for additional information regarding the business segments of the Company.

Company, through Security National Life, First Guaranty Insurance Company (“First Guaranty”), and Kilpatrick Life Insurance

9 unchanged sentences

The Company believes that

funeral plans represent a marketing niche that has lower competition because most insurance companies do not offer similar coverage.

The purpose of the funeral plan policy is to pay the costs and expenses incurred at the time of a person’s death.

funeral plans represent a marketing niche that has less competition because most insurance companies do not offer similar coverage.

purpose of the funeral plan policy is to pay the costs and expenses incurred at the time of a person’s death.

On a per thousand-dollar

6 unchanged sentences

service specific niche markets.

The Company’s funeral plan policies are sold primarily to persons who range in age from 45 to 85

The Company’s funeral plan policies are sold primarily to people who range in age from 45 to 85

and have low to moderate income.

A majority of the Company’s funeral plan premiums come from the states of Arkansas, California,

Florida, Georgia, Louisiana, Mississippi, Texas, and Utah.

Most of the Company’s funeral plan premiums come from the states of Arkansas, California, Florida,

Georgia, Louisiana, Mississippi, Texas, and Utah.

Company sells its life insurance products through direct agents, brokers, and independent licensed agents who may also sell insurance

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insurance business for the five years ended December 31, 2023:

Count as of December 31

Insurance in force

as of December 31 (in thousands)

Collected (in thousands)

of Kilpatrick

Life Insurance

Policy/Cert Count as of December 31

Insurance in force as of December 31 (in thousands)

$ 3,446,836 (1)

$ 3,415,368 (1)

$ 3,379,921 (1)

$ 3,303,061 (1)

Premiums Collected (in thousands)

Prior years have been adjusted to include accidental death benefit insurance in force that was inadvertently excluded.

factors considered in evaluating an application for ordinary life insurance coverage can include the applicant’s age, occupation,

general health, and medical history.

Upon receipt of a satisfactory (non-funeral plan insurance) application, which contains pertinent

medical questions, the Company issues insurance based upon its medical limits and requirements subject to the following general non-medical

Nearest Birthday

(APS or exam)

general health condition, and medical history.

Upon receipt of a satisfactory (non-funeral plan insurance) application, which contains

pertinent medical questions, the Company issues insurance based upon its medical limits and requirements subject to the following general

non-medical limits:

Medical information

required (APS or

underwriting life insurance, the Company will sometimes issue policies with higher premium rates for substandard risks.

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remits a sum of money to the Company in return for the Company’s obligation to pay a series of payments on a periodic basis over

a designated period of time, such as an individual’s life, or for such other period as may be designated.

a designated period, such as an individual’s life, or for such other period as may be designated.

have guaranteed interest rates that range from 1% to 6.5% per annum.

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modified by the Board of Directors at its discretion.

In order for the Company to realize a profit on an annuity product, the Company

must maintain an interest rate spread between its investment income and the interest rate credited to the annuities.

Commissions, issuance

expenses, and general and administrative expenses are deducted from this interest rate spread.

For the Company to make a profit on an annuity product, the Company must maintain

an interest rate spread between its investment income and the interest rate credited to the annuities.

Commissions, issuance expenses,

and general and administrative expenses are deducted from this interest rate spread.

and Distribution

5 unchanged sentences

following table summarizes the annuity business for the five years ended December 31, 2023:

Policy/Cert Count as of December 31

Collected (in thousands)

(1) Acquisition

of Kilpatrick

its various acquisitions, the Company occasionally acquires small blocks of accident and health policies, which it continues to service.

The Company offers a low-cost comprehensive diver’s accident policy that provides worldwide coverage for medical expense reimbursement

in the event of a diving accident.

Annuities Policy/Cert Count as of December 31

Deposits Collected (in thousands)

its various acquisitions, the Company occasionally acquires small blocks of accident and health insurance policies, which it continues

The Company offers a low-cost comprehensive diver’s accident insurance policy that provides worldwide coverage for

medical expense reimbursement in the event of a diving accident.

and Distribution

Company currently markets its diver’s accident policies through the internet.

Company currently markets its diver’s accident insurance policies through the internet.

following table summarizes the accident and health insurance business for the five years ended December 31, 2023:

and Health Policy/Cert Count as of December 31

Collected (in thousands)

(1) Acquisition

of Kilpatrick

Accident and Health Policy/Cert

Count as of December 31

Premiums Collected (in thousands)

primary purpose of reinsurance is to enable an insurance company to issue an insurance policy in an amount larger than the risk the insurance

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is the Company’s policy to retain no more than $100,000 of ordinary insurance per insured life, with the excess risk being reinsured.

The total amount of life insurance reinsured by other companies as of December 31, 2022, was $346,749,000, which represented approximately

12.1% of the Company’s life insurance in force on that date.

The total policy amount of life insurance reinsured by other companies as of December 31, 2023, was $333,211,000, which represented approximately

9.3% of the Company’s total life insurance policy amount in force on that date.

“Management’s Discussion and Analysis of Results of Operations and Financial Condition” and “Notes to Consolidated

11 unchanged sentences

an at-need basis (at the time of death).

The products include:

plots, interment vaults, mausoleum crypts, markers, caskets, urns and

The products include plots, interment vaults, mausoleum crypts, markers, caskets, urns, and

other death care related products.

These services include:

professional services of funeral directors, opening and closing of graves,

These services include professional services of funeral directors, opening and closing of graves,

use of chapels and viewing rooms, and use of automobiles and clothing.

22 unchanged sentences

uses internal and external funding sources to fund mortgage loans.

In December 2021, the Company ceased operations through EverLEND Mortgage

and merged its operations into SecurityNational Mortgage.

National Life originates and funds commercial real estate loans, residential construction loans, and land development loans for internal

and Distribution

Company’s residential mortgage lending services are marketed primarily to real estate brokers, builders and directly with consumers.

Company’s residential mortgage lending services are marketed primarily to real estate brokers, builders and directly to consumers.

The Company has a strong retail origination presence in the Utah, Florida, Texas, Nevada and Arizona markets and many other states across

2 unchanged sentences

Acquisitions and Other Business Activities

of Rivera Funerals, Cremations and Memorial Gardens

December 21, 2021, the Company, through Memorial Estates Inc., completed a business combination transaction with Rivera Funerals, Cremations

and Memorial Gardens.

The mortuaries and cemetery are located in New Mexico.

the terms of the transaction, as set forth in the Asset Purchase Agreement, dated December 21, 2021, Memorial Estates Inc.

purchase price of $10,693,395 for the business and assets of Rivera Funerals, Cremations and Memorial Gardens, subject to holdback amounts

held by Memorial Estates, Inc.

in the total amount of $1,120,000.

Pursuant to the Asset Purchase Agreement, Memorial Estates, Inc.

$70,000 of the holdback amount to pay trade accounts payable of Rivera Funerals, Cremations and Memorial Gardens to third parties that

remained unpaid at the time of purchase.

The remaining $1,050,000 holdback amount is to be released and paid by Memorial Estates Inc.

in annual payments of up to $105,000 each, beginning in January 2023.

of Holbrook Mortuary

December 28, 2021, the Company, through its wholly-owned subsidiary, Memorial Mortuary Inc., completed a business combination transaction

with Holbrook Mortuary located in Salt Lake City, Utah.

the terms of the transaction, as set forth in the Asset Purchase Agreement, dated December 28, 2021, Memorial Mortuary Inc.

purchase price of $3,051,747 for the business and assets of Holbrook Mortuary.

Estate Development

Company is capitalizing on the opportunity to develop commercial and residential assets on its existing properties.

The cost to acquire

existing for-sale assets currently exceeds the replacement costs, thus creating the opportunity for development and redevelopment of

the land that the Company currently owns.

The Company has developed, or is in the process of developing, assets that have an initial

development cost exceeding $100,000,000, primarily relating to the Center53 Development.

The Company plans to continue its development

endeavors as based upon its assessment of the market demand.

Company is capitalizing on the opportunity to develop commercial and residential assets on its existing and recently acquired properties.

The cost to acquire existing for-sale assets currently exceeds the replacement costs, thus creating the opportunity for development and

redevelopment of the land that the Company currently owns.

The Company has developed, or is in the process of developing, assets that

have an initial development cost exceeding $100,000,000, primarily relating to the Center53 Development and multiple single family residential

development projects.

The Company plans to continue its development endeavors as based upon its assessment of the market demand.

Development is an office development project comprising nearly 20 acres of land that is currently owned by the Company in the central

2 unchanged sentences

nearly one million square-feet of office space in five buildings, ranging from four to eleven stories, and will be serviced by three

parking structures with about 4,000 stalls.

In 2015, the Company broke ground and commenced development on the first phase which included

a six-story building of nearly 200,000 square feet and a parking garage with 748 parking stalls.

The first phase of the project was completed

in July 2017 and is currently 100% leased.

The second phase of the project began in March 2020 and includes a second six story building

of nearly 221,000 square feet and a parking garage with approximately 870 stalls.

The Company began its occupancy of a portion of the

building in October 2021 and the remainder of the building is currently 100% leased.

The Company plans to initiate future phases of the

Center53 Development for additional Class A office space in the central valley of Salt Lake City.

parking structures with approximately 4,000 stalls.

In 2015, the Company broke ground and commenced development on the first phase which

included a six-story building of nearly 200,000 square feet and a parking garage with 748 parking stalls.

The first phase of the project

was completed in July 2017 and is currently 93% leased.

The second phase of the project began in March 2020 and includes a second six-story

building of nearly 221,000 square feet and a parking garage with approximately 870 stalls.

The Company began its occupancy of a portion

of the building in October 2021 and the remainder of the building is currently 100% leased.

The Company plans to initiate future phases

of the Center53 Development for additional Class A office space in the central valley of Salt Lake City.

Company’s insurance subsidiaries are subject to comprehensive regulation in the jurisdictions in which they do business under statutes

30 unchanged sentences

Its most recent final examination reports have been approved by the insurance departments

and are public record.

and are public records.

Texas Department of Banking also audits pre-need insurance policies that are issued in the state of Texas.

13 unchanged sentences

information concerning the number of spaces sold and, where applicable, funds provided to the Endowment Care Trust Fund.

issued annually on the basis of such reports.

issued annually based on such reports.

The cemeteries maintain city or county licenses where they conduct business.

3 unchanged sentences

These regulations, among

other things, specify minimum capital requirements and;

procedures for loan origination and underwriting, licensing of brokers and loan

officers and, quality review audits and specify the fees that can be charged to borrowers.

Each year, the Company is required to have

an audit completed for each mortgage subsidiary by an independent registered public accounting firm to verify compliance with the relevant

In addition to the government regulations, the Company must meet loan requirements, and underwriting guidelines of various

investors who purchase the loans.

EverLEND Mortgage is not required to have an audit for 2021 since it ceased operations in December

other things, specify minimum capital requirements;

procedures for loan origination and underwriting, licensing of brokers and loan officers

and quality review audits and specify the fees that can be charged to borrowers.

Each year, the Company is required to have an audit

completed for each mortgage subsidiary by an independent registered public accounting firm to verify compliance with the relevant regulations.

In addition to the government regulations, the Company must meet loan requirements, and underwriting guidelines of various investors

who purchase the loans.

Company’s insurance subsidiaries, Security National Life, First Guaranty and Kilpatrick are taxed under the Life Insurance Company

3 unchanged sentences

(with modifications).

Under The Tax Cuts and Jobs Act, December 31, 2017 policyholder surplus account balances result in taxable income

over a period of eight years.

Under The Tax Cuts and Jobs Act (the “Tax Act”), December 31, 2017 policyholder surplus account balances

result in taxable income over a period of eight years.

National Life, First Guaranty and Kilpatrick calculate their life insurance taxable income after establishing a provision representing

13 unchanged sentences

The Company’s insurance subsidiaries compete with a large number of insurance companies, many of which have greater financial

resources, a longer business history, and more diversified line of insurance products than the Company.

In addition, such companies generally

have a larger sales force.

Further, the Company competes with mutual insurance companies which may have a competitive advantage because

all profits accrue to policyholders.

Because the Company is smaller by industry standards and lacks broad diversification of risk, it

may be more vulnerable to losses than larger, better-established companies.

The Company believes that its policies and rates for the

markets it serves are generally competitive.

cemetery and mortuary industry is also highly competitive.

In the Utah, California and New Mexico markets where the Company competes,

there are a number of cemeteries and mortuaries which have longer business histories, more established positions in the community, and

stronger financial positions than the Company.

In addition, some of the cemeteries with which the Company must compete for sales are

owned by municipalities and, as a result, can offer lower prices than can the Company.

The Company bears the cost of a pre-need sales

program that is not incurred by those competitors which do not have a pre-need sales force.

The Company believes that its products and

prices are generally competitive with those in the industry.

mortgage industry is highly competitive with a large number of mortgage companies and banks in the same geographic area in which the

Company is operating.

The mortgage industry in general is sensitive to changes in interest rates and the refinancing market is particularly

vulnerable to changes in interest rates.

resources, longer business histories, and more diversified lines of insurance products than the Company.

In addition, such companies

generally have larger sales forces.

Further, the Company competes with mutual insurance companies which may have a competitive advantage

because all profits accrue to policyholders.

Because the Company is smaller by industry standards and lacks broad diversification of

risk, it may be more vulnerable to losses than larger, better-established companies.

The Company believes that its policies and rates

for the markets it serves are generally competitive.

cemetery and mortuary industry is highly competitive.

In the Utah, California, and New Mexico markets where the Company competes, there

are several cemeteries and mortuaries which have longer business histories, more established positions in the community, and stronger

financial positions than the Company.

In addition, some of the cemeteries with which the Company must compete for sales are owned by

municipalities and, as a result, can offer lower prices than can the Company.

The Company bears the cost of a pre-need sales program

that is not incurred by those competitors which do not have a pre-need sales force.

The Company believes that its products and prices

are generally competitive with those in the industry.

mortgage industry is highly competitive with many mortgage companies and banks in the same geographic area in which the Company is operating.

The mortgage industry in general is sensitive to changes in interest rates and the refinancing market is particularly vulnerable to changes

in interest rates.

Company’s business is generally not subject to seasonal fluctuations.

Capital Management

9 unchanged sentences

group health insurance plans.

Company has an employee safe harbor retirement plan that qualifies under section 401(k) of the Internal Revenue Code and contributes

a matching contribution based on the employee’s contribution and years of service.

Company has an employee safe harbor retirement plan for each business segment.

The retirement plans qualify under section 401(k) of the

Internal Revenue Code and, if approved by the board of directors, the Company makes a matching contribution in Company stock based on

the employee’s contribution amount.

Company provides other time off benefits such as paid sick and paid vacation time.

The Company provides discounts on pre-need and death

benefits to tenured employees.

Additionally, the Company offers an employee assistance program that provides 24/7 counseling services

for employees who may be facing challenges outside of the workplace.

Company’s internet address is securitynational.com.

The Company’s investor relations website is investor.securitynational.com

The Company provides discounts on certain services

provided by the Company to its employees.

Additionally, the Company offers an employee assistance program that provides 24/7 counseling

services for employees who may be facing challenges outside of the workplace.

Company’s internet address is www.securitynational.com.

The Company’s investor relations website is www.investor.securitynational.com

and the Company promptly makes available on this website, free of charge, the reports that it files or furnishes with the Securities

1 unchanged sentence

a smaller reporting company, the Company is not required to provide information typically disclosed under this item.

Unresolved Staff Comments

As a smaller reporting company, the Company is not required to provide information typically disclosed under this item.

following tables set forth the location of the Company’s office facilities and certain other information relating to these properties.

Owned / Leased

Approximate Square Footage

433 Ascension Way, Floors 4, 5 and 6

Salt Lake City

Corporate Headquarters, Insurance Operations, Cemetery and Mortuary Operations, Mortgage Operations and Sales

1044 River Oaks Dr.

Insurance Operations

1818 Marshall St.

Insurance Operations

812 Sheppard St.

Insurance Sales

909 Foisy Ave.

Insurance Sales

1 Sanctuary Blvd.

Insurance Sales

Funeral Service Sales

Salt Lake City

Funeral Service Sales

1627A Central Ave.

Funeral Service Sales

200 Market Way

Fast Funding Operations

500 Blount Avenue,

Mortgage Sales

1101 McMurtrie Drive, Suite F1

Mortgage Sales

99th Ave., Suite 101/103

Mortgage Sales

month to month

Hayden Rd., Suite 100

Mortgage Sales

month to month

1819 Dobson Rd., Suite 202

Mortgage Sales

Central Ave., Suite 1100A

Mortgage Sales

month to month

Price Road, Suite 318

Mortgage Sales

99th Ave., Suite 111

Mortgage Sales

month to month

1951 West Camelback Rd, Ste 200

Mortgage Sales

month to month

AZ (01144) 2636 Hwy 95 Suite 2 Bullhead City, 86442 (az-2636)

Bullhead City

Mortgage Sales

month to month

6870 S Highway 95 Building C Suite 451B,

Mohave Valley

Mortgage Sales

month to month

Country Club Drive Suite 101

Mortgage Sales

El Caminito Dr.

Mortgage Sales

month to month

Paseo De La Masada

Mortgage Sales

month to month

350 West 16th Street #209

Mortgage Sales

102 North Cortez St.

Mortgage Sales

month to month

40977 Oak Dr.

Mortgage Sales

month to month

South, Suite 250

Mortgage Sales

month to month

7398 Fox Trail Unit B

Mortgage Sales

month to month

3247 West March Lane, Ste 125

Mortgage Sales

Commercial Dr, Ste 285

Mortgage Sales

Highway 101 Suite 7

Mortgage Sales

44441 West 16th Street #101

Mortgage Sales

1420 Magnolia Ave

Mortgage Sales

81 Broadmoor Ct.

Mortgage Sales

month to month

625 The City Drive, Suite 450

Mortgage Sales

5475 Tech Center Dr., Suite 100

Colorado Springs

Mortgage Sales

27 Main St., Suite C-104B

Mortgage Sales

month to month

4501 Mohawk Dr.

Mortgage Sales

month to month

Union Ave., Suite 550

Mortgage Sales

5982 s Zeno Ct

Mortgage Sales

month to month

1145 Town Park Ave., Suite 2215

Mortgage Sales

8191 College Parkway, Suite 201

Mortgage Sales

and 82nd Ave.

Mortgage Sales

2350 Fruitville Rd Ste, Ste 101

Mortgage Sales

921 Club House Blvd, New Smyrna Beach,

Mortgage Sales

month to month

5237 Summerlin Commons Blvd.

Mortgage Sales

month to month

10752 Deerwood Park Blvd South Waterview II, Suite 135, Office # 170

Mortgage Sales

3331 Pasadena Court

Mortgage Sales

month to month

106 A Adamson Square

Mortgage Sales

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

What changed 10-K

Item 1. Business