10-Q - GL - Equibles

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark one)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to ________

Commission File Number: 001-08052

GLOBE LIFE INC.

(Exact name of registrant as specified in its charter)

Delaware	63-0780404
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

3700 South Stonebridge Drive, McKinney, Texas 75070

(Address of principal executive offices) (Zip Code)

(972) 569-4000

(Registrant’s telephone number, including area code)

NONE

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $1.00 par value per share	GL	New York Stock Exchange
4.250% Junior Subordinated Debentures	GL PRD	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.			☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding for each of the issuer’s classes of common stock, as of the last practicable date.

Class	Outstanding at October 27, 2021
Common Stock, $1.00 Par Value	100,979,225

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Globe Life Inc.

Table of Contents

			Page
PART I. FINANCIAL INFORMATION
	Item 1.	Condensed Consolidated Financial Statements
		Condensed Consolidated Balance Sheets	1
		Condensed Consolidated Statements of Operations	2
		Condensed Consolidated Statements of Comprehensive Income (Loss)	3
		Condensed Consolidated Statements of Shareholders' Equity	4
		Condensed Consolidated Statements of Cash Flows	6
		Notes to Condensed Consolidated Financial Statements	7
		Note 1—Significant Accounting Policies	7
		Note 2—New Accounting Standards	9
		Note 3—Supplemental Information about Changes to Accumulated Other Comprehensive Income	10
		Note 4—Investments	12
		Note 5—Commitments and Contingencies	23
		Note 6—Liability for Unpaid Claims	24
		Note 7—Postretirement Benefits	25
		Note 8—Earnings Per Share	27
		Note 9—Debt	28
		Note 10—Business Segments	29
		Cautionary Statements	36
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	37
	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	67
	Item 4.	Controls and Procedures	67
PART II. OTHER INFORMATION
	Item 1.	Legal Proceedings	67
	Item 1A.	Risk Factors	68
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	68
	Item 6.	Exhibits	69
Signatures			70

As used in this Form 10-Q, “Globe Life,” the “Company,” “we,” “our” and “us” refer to Globe Life Inc., a Delaware corporation incorporated in 1979, its subsidiaries and affiliates.

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PART I—FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

Globe Life Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(Dollar amounts in thousands, except per share data)

	September 30,<br>2021		December 31, 2020
Assets:
Investments:
Fixed maturities—available for sale, at fair value (amortized cost: 2021—$17,622,028;<br><br>2020—$17,197,145, allowance for credit losses: 2021— $0; 2020— $3,346)	$	21,160,866	$	21,213,509
Policy loans	585,791		584,379
Other long-term investments (includes: 2021—$586,223; 2020—$385,038 under the fair value option)	733,177		546,981
Short-term investments	93,364		107,782
Total investments	22,573,198		22,452,651
Cash	96,325		94,847
Accrued investment income	264,257		248,991
Other receivables	485,475		474,180
Deferred acquisition costs	4,837,409		4,595,444
Goodwill	481,791		441,591
Other assets	758,123		739,027
Total assets	$	29,496,578	$	29,046,731
Liabilities:
Future policy benefits	$	15,837,212	$	15,243,536
Unearned and advance premium	64,900		61,728
Policy claims and other benefits payable	395,914		399,507
Other policyholders' funds	98,151		97,968
Total policy liabilities	16,396,177		15,802,739
Current and deferred income taxes	1,749,427		1,833,723
Short-term debt	393,593		254,918
Long-term debt (estimated fair value: 2021—$1,680,536; 2020—$1,871,754)	1,546,194		1,667,886
Other liabilities	803,036		716,373
Total liabilities	20,888,427		20,275,639
Commitments and Contingencies (Note 5)
Shareholders' equity:
Preferred stock, par value $1 per share—5,000,000 shares authorized; outstanding: 0 in 2021 and 2020	—		—
Common stock, par value $1 per share—320,000,000 shares authorized; outstanding: (2021—113,218,183 issued; 2020—113,218,183 issued)	113,218		113,218
Additional paid-in-capital	533,683		527,435
Accumulated other comprehensive income (loss)	2,661,619		3,029,244
Retained earnings	6,353,261		5,874,109
Treasury stock, at cost: (2021—12,078,358 shares; 2020—9,420,699 shares)	(1,053,630)		(772,914)
Total shareholders' equity	8,608,151		8,771,092
Total liabilities and shareholders' equity	$	29,496,578	$	29,046,731

See accompanying Notes to Condensed Consolidated Financial Statements.

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Globe Life Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(Dollar amounts in thousands, except per share data)

	Three Months Ended<br>September 30,				Nine Months Ended<br>September 30,
	2021		2020		2021		2020
Revenue:
Life premium	$	728,924	$	674,021	$	2,165,213	$	1,994,473
Health premium	299,143		287,795		888,902		850,877
Other premium	—		1		1		4
Total premium	1,028,067		961,817		3,054,116		2,845,354
Net investment income	238,975		231,432		713,103		691,991
Realized gains (losses)	10,475		1,501		47,286		(29,386)
Other income	321		292		1,004		1,021
Total revenue	1,277,838		1,195,042		3,815,509		3,508,980
Benefits and expenses:
Life policyholder benefits	516,196		459,231		1,532,298		1,340,746
Health policyholder benefits	187,906		184,237		564,589		546,444
Other policyholder benefits	7,303		7,508		21,848		22,571
Total policyholder benefits	711,405		650,976		2,118,735		1,909,761
Amortization of deferred acquisition costs	151,593		140,843		452,607		430,840
Commissions, premium taxes, and non-deferred acquisition costs	82,774		74,614		244,752		229,691
Other operating expense	80,385		75,397		240,750		226,693
Interest expense	20,886		21,674		63,833		65,295
Total benefits and expenses	1,047,043		963,504		3,120,677		2,862,280
Income before income taxes	230,795		231,538		694,832		646,700
Income tax benefit (expense)	(41,924)		(42,593)		(127,826)		(119,167)
Net income	$	188,871	$	188,945	$	567,006	$	527,533
Basic net income per common share	$	1.86	$	1.78	$	5.53	$	4.95
Diluted net income per common share	$	1.84	$	1.76	$	5.46	$	4.90

See accompanying Notes to Condensed Consolidated Financial Statements.

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Globe Life Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)

(Dollar amounts in thousands)

	Three Months Ended<br>September 30,				Nine Months Ended<br>September 30,
	2021		2020		2021		2020
Net income	$	188,871	$	188,945	$	567,006	$	527,533
Other comprehensive income (loss):
Investments:
Unrealized gains (losses) on fixed maturities:
Unrealized holding gains (losses) arising during period	(95,906)		380,299		(453,917)		861,871
Other reclassification adjustments included in net income	(14,599)		11,838		(31,096)		37,060
Foreign exchange adjustment on fixed maturities recorded at fair value	(519)		1,250		4,141		(914)
Unrealized gains (losses) on fixed maturities	(111,024)		393,387		(480,872)		898,017
Unrealized gains (losses) on other investments	—		—		—		(13,260)
Total unrealized investment gains (losses)	(111,024)		393,387		(480,872)		884,757
Less applicable tax (expense) benefit	23,317		(82,612)		100,984		(185,800)
Unrealized gains (losses) on investments, net of tax	(87,707)		310,775		(379,888)		698,957
Deferred acquisition costs:
Unrealized gains (losses) attributable to deferred acquisition costs	432		385		1,199		1,150
Less applicable tax (expense) benefit	(91)		(81)		(252)		(242)
Unrealized gains (losses) attributable to deferred acquisition costs, net of tax	341		304		947		908
Foreign exchange translation:
Foreign exchange translation adjustments, other than securities	(6,839)		5,522		(1,276)		(4,973)
Less applicable tax (expense) benefit	1,437		(1,158)		269		1,045
Foreign exchange translation adjustments, other than securities, net of tax	(5,402)		4,364		(1,007)		(3,928)
Pension:
Pension adjustments	5,198		4,156		15,598		12,471
Less applicable tax (expense) benefit	(1,090)		(873)		(3,275)		(2,619)
Pension adjustments, net of tax	4,108		3,283		12,323		9,852
Other comprehensive income (loss)	(88,660)		318,726		(367,625)		705,789
Comprehensive income (loss)	$	100,211	$	507,671	$	199,381	$	1,233,322

See accompanying Notes to Condensed Consolidated Financial Statements.

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Globe Life Inc.

Condensed Consolidated Statements of Shareholders' Equity

(Unaudited)

(Dollar amounts in thousands, except per share data)

	Preferred Stock		Common Stock		Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Treasury Stock		Total Shareholders' Equity
Balance at December 31, 2020	$	—	$	113,218	$	527,435	$	3,029,244	$	5,874,109	$	(772,914)	$	8,771,092
Comprehensive income (loss)	—		—		—		(1,004,729)		178,517		—		(826,212)
Common dividends declared<br><br>($0.1975 per share)	—		—		—		—		(20,435)		—		(20,435)
Acquisition of treasury stock	—		—		—		—		—		(132,720)		(132,720)
Stock-based compensation	—		—		(11,422)		—		1,168		18,142		7,888
Exercise of stock options	—		—		—		—		(12,807)		45,531		32,724
Balance at March 31, 2021	—		113,218		516,013		2,024,515		6,020,552		(841,961)		7,832,337
Comprehensive income (loss)	—		—		—		725,764		199,618		—		925,382
Common dividends declared<br><br>($0.1975 per share)	—		—		—		—		(20,171)		—		(20,171)
Acquisition of treasury stock	—		—		—		—		—		(162,864)		(162,864)
Stock-based compensation	—		—		8,634		—		—		—		8,634
Exercise of stock options	—		—		—		—		(14,033)		47,637		33,604
Balance at June 30, 2021	—		113,218		524,647		2,750,279		6,185,966		(957,188)		8,616,922
Comprehensive income (loss)	—		—		—		(88,660)		188,871		—		100,211
Common dividends declared<br><br>($0.1975 per share)	—		—		—		—		(19,981)		—		(19,981)
Acquisition of treasury stock	—		—		—		—		—		(97,796)		(97,796)
Stock-based compensation	—		—		9,036		—		(1,260)		—		7,776
Exercise of stock options	—		—		—		—		(335)		1,354		1,019
Balance at September 30, 2021	$	—	$	113,218	$	533,683	$	2,661,619	$	6,353,261	$	(1,053,630)	$	8,608,151

See accompanying Notes to Condensed Consolidated Financial Statements.

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Globe Life Inc.

Condensed Consolidated Statements of Shareholders' Equity

(Unaudited)

(Dollar amounts in thousands, except per share data)

	Preferred Stock		Common Stock		Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Treasury Stock		Total Shareholders' Equity
Balance at December 31, 2019	$	—	$	117,218	$	531,554	$	1,844,830	$	5,551,329	$	(750,624)	$	7,294,307
Cumulative effect of change in accounting principles, net of tax(1)	—		—		—		—		(454)		—		(454)
Balance at January 1, 2020	—		117,218		531,554		1,844,830		5,550,875		(750,624)		7,293,853
Comprehensive income (loss)	—		—		—		(778,583)		165,540		—		(613,043)
Common dividends declared<br><br>($0.1875 per share)	—		—		—		—		(19,963)		—		(19,963)
Acquisition of treasury stock	—		—		—		—		—		(166,729)		(166,729)
Stock-based compensation	—		—		(12,126)		—		(482)		21,964		9,356
Exercise of stock options	—		—		—		—		(9,539)		26,347		16,808
Balance at March 31, 2020	—		117,218		519,428		1,066,247		5,686,431		(869,042)		6,520,282
Comprehensive income (loss)	—		—		—		1,165,646		173,048		—		1,338,694
Common dividends declared<br><br>($0.1875 per share)	—		—		—		—		(19,956)		—		(19,956)
Stock-based compensation	—		—		8,632		—		—		—		8,632
Exercise of stock options	—		—		—		—		(593)		1,310		717
Balance at June 30, 2020	—		117,218		528,060		2,231,893		5,838,930		(867,732)		7,848,369
Comprehensive income (loss)	—		—		—		318,726		188,945		—		507,671
Common dividends declared<br><br>($0.1875 per share)	—		—		—		—		(19,692)		—		(19,692)
Acquisition of treasury stock	—		—		—		—		—		(129,919)		(129,919)
Stock-based compensation	—		—		8,667		—		—		—		8,667
Exercise of stock options	—		—		—		—		(5,776)		15,588		9,812
Balance at September 30, 2020	$	—	$	117,218	$	536,727	$	2,550,619	$	6,002,407	$	(982,063)	$	8,224,908

(1)Adoption of Accounting Standard Update (ASU) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, on January 1, 2020.

See accompanying Notes to Condensed Consolidated Financial Statements.

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Globe Life Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(Dollar amounts in thousands)

	Nine Months Ended<br>September 30,
	2021		2020
Cash provided from (used for) operating activities	$	1,060,022	$	1,078,616
Cash provided from (used for) investing activities:
Investments sold or matured:
Fixed maturities available for sale—sold	91,795		52,681
Fixed maturities available for sale—matured or other redemptions	249,653		333,631
Other long-term investments	36,060		35,547
Total investments sold or matured	377,508		421,859
Acquisition of investments:
Fixed maturities—available for sale	(687,993)		(905,371)
Other long-term investments	(206,609)		(213,075)
Total investments acquired	(894,602)		(1,118,446)
Net (increase) decrease in policy loans	(1,412)		(5,719)
Net (increase) decrease in short-term investments	14,418		(225,594)
Additions to properties	(30,730)		(28,790)
Other investing activities	(59,200)		(7,099)
Investments in low-income housing interests	(35,236)		(28,669)
Cash provided from (used for) investing activities	(629,254)		(992,458)
Cash provided from (used for) financing activities:
Issuance of common stock	67,347		27,337
Cash dividends paid to shareholders	(60,068)		(58,503)
Repayment of debt	(300,000)		(386,875)
Proceeds from issuance of debt	325,000		700,000
Payment for debt issuance costs	(7,639)		(5,844)
Net borrowing (repayment) of commercial paper	(10,991)		(9,605)
Acquisition of treasury stock	(393,380)		(296,648)
Net receipts (payments) from deposit-type products	(48,276)		(56,858)
Cash provided from (used for) financing activities	(428,007)		(86,996)
Effect of foreign exchange rate changes on cash	(1,283)		5,006
Net increase (decrease) in cash	1,478		4,168
Cash at beginning of year	94,847		75,933
Cash at end of period	$	96,325	$	80,101

See accompanying Notes to Condensed Consolidated Financial Statements.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Note 1—Significant Accounting Policies

Business: (Globe Life), (the Company), refers to Globe Life Inc., an insurance holding company incorporated in Delaware in 1979, and Globe Life Inc. subsidiaries and affiliates. Globe Life Inc.'s direct or indirect primary subsidiaries are Globe Life And Accident Insurance Company, American Income Life Insurance Company, Liberty National Life Insurance Company, Family Heritage Life Insurance Company of America, and United American Insurance Company. The underwriting companies are owned by their ultimate corporate parent, Globe Life Inc. (the Parent Company).

Globe Life provides a variety of life and supplemental health insurance products and annuities to a broad base of customers. The Company is organized into four reportable segments: life insurance, supplemental health insurance, annuities, and investments.

Basis of Presentation: The accompanying condensed consolidated financial statements of Globe Life have been prepared in accordance with the instructions to Form 10-Q. Therefore, they do not include all of the disclosures required by accounting principles generally accepted in the United States of America (GAAP) for annual financial statements. However, in the opinion of management, these statements include all adjustments, consisting of normal recurring adjustments, which are necessary for a fair presentation of the condensed consolidated financial position at September 30, 2021, and the condensed consolidated results of operations, comprehensive income, and cash flows for the periods ended September 30, 2021 and 2020. The interim period condensed consolidated financial statements should be read in conjunction with the Consolidated Financial Statements that are included in the Form 10-Kfiled with the Securities Exchange Commission (SEC) on February 25, 2021.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Acquisition: On August 1, 2021 the Company acquired Beazley Benefits, a small unit of Beazley Insurance Company, Inc. for $59.2 million. This business will enhance our ability to reach the worksite market. In conjunction with this agreement, the Company also executed a 100% coinsurance agreement assuming the remaining inforce business produced by the unit, which included a $2.5 million ceding commission. The acquisition was accounted for under the purchase method of accounting as required by accounting guidance generally accepted in the United States of America. This guidance requires that the total purchase price be allocated to the assets acquired and liabilities assumed based on their fair values at the acquisition date. The results of operations since the acquisition date have been consolidated.

	Fair Value as of
	August 1, 2021
Assets Acquired:
Trade name	$	300
Value of Customer Relationships Acquired	5,200
Value of Distribution Acquired	11,000
Goodwill	40,200
	56,700
Ceding commission	2,500
Total purchase price	$	59,200

In accordance with the applicable guidance, the Company is finalizing the estimation of the fair value of the acquired assets and may do so up to one year. If any changes are deemed necessary to the preliminary estimates and possibly goodwill, the Company will make an opening balance sheet adjustment.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Note 2—New Accounting Standards

Accounting Pronouncements Adopted in the Current Year
Standard	Description	Effective Date	Effect on the Consolidated Financial Statements
ASU No. 2020-08, Codification Improvements to Subtopic 310-20, Receivables-Nonrefundable Fees and Other Costs	The standard was issued as an amendment to ASU 2017-08, and clarifies that callable debt securities with a premium should be amortized to the next call date.	This standard became effective on January 1, 2021.	The adoption of this standard did not have a material impact on the consolidated financial statements.
Accounting Pronouncements Yet to be Adopted
---	---	---	---
Standard	Description	Effective Date	Effect on the Consolidated Financial Statements
ASU No. 2018-12/2019-09/2020-11,<br><br>Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts, with clarification guidance issued in November 2019 and 2020.	ASU 2018-12 is a significant change to our current accounting and disclosure of long-duration contracts, which is our primary business. The guidance was primarily issued to: 1) improve the timeliness of recognizing changes in the liability for future policy benefits and modify the rate used to discount future cash flows, 2) simplify and improve the accounting for certain market-based options or guarantees associated with deposit (or account balance) contracts, 3) simplify the amortization of deferred acquisition costs, and 4) improve the effectiveness of the required disclosures.	As a result of the issuance of ASU 2020-11 in November 2020, the effective date for this standard was changed to January 1, 2023. Early adoption is available.	The Company is currently in the process of evaluating the impact this standard will have on the consolidated financial statements and disclosures, specifically assessing key accounting policies, assumption and data inputs, controls, and enhanced system solutions.<br><br>As of the balance sheet date, the Company is continuing to upgrade its valuation systems as part of its implementation plan. In addition, significant progress has been made allowing the Company to execute parallel valuation runs on major blocks of business and is updating its accounting policies. Due to the overall nature of the standard, the impact on the consolidated financial statements is expected to be significant. At this time, the Company does not have an estimate of the impact. The Company does not expect to early adopt this ASU and has selected a modified retrospective transition method.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Note 3—Supplemental Information about Changes to Accumulated Other Comprehensive Income

Components of Accumulated Other Comprehensive Income: An analysis of the change in balance by component of Accumulated Other Comprehensive Income is as follows for the three and nine month periods ended September 30, 2021 and 2020:

	Three Months Ended September 30, 2021
	Available<br>for Sale<br>Assets		Deferred<br>Acquisition<br>Costs		Foreign<br>Exchange		Pension<br>Adjustments		Total
Balance at July 1, 2021	$	2,883,391	$	(4,098)	$	27,697	$	(156,711)	$	2,750,279
Other comprehensive income (loss) before reclassifications, net of tax	(76,174)		341		(5,402)		—		(81,235)
Reclassifications, net of tax	(11,533)		—		—		4,108		(7,425)
Other comprehensive income (loss)	(87,707)		341		(5,402)		4,108		(88,660)
Balance at September 30, 2021	$	2,795,684	$	(3,757)	$	22,295	$	(152,603)	$	2,661,619
	Three Months Ended September 30, 2020
---	---	---	---	---	---	---	---	---	---	---
	Available<br>for Sale<br>Assets		Deferred<br>Acquisition<br>Costs		Foreign<br>Exchange		Pension<br>Adjustments		Total
Balance at July 1, 2020	$	2,370,832	$	(5,312)	$	3,766	$	(137,393)	$	2,231,893
Other comprehensive income (loss) before reclassifications, net of tax	301,423		304		4,364		—		306,091
Reclassifications, net of tax	9,352		—		—		3,283		12,635
Other comprehensive income (loss)	310,775		304		4,364		3,283		318,726
Balance at September 30, 2020	$	2,681,607	$	(5,008)	$	8,130	$	(134,110)	$	2,550,619	Nine Months Ended September 30, 2021
---	---	---	---	---	---	---	---	---	---	---
	Available<br>for Sale<br>Assets		Deferred<br>Acquisition<br>Costs		Foreign<br>Exchange		Pension<br>Adjustments		Total
Balance at January 1, 2021	$	3,175,572	$	(4,704)	$	23,302	$	(164,926)	$	3,029,244
Other comprehensive income (loss) before reclassifications, net of tax	(355,322)		947		(1,007)		—		(355,382)
Reclassifications, net of tax	(24,566)		—		—		12,323		(12,243)
Other comprehensive income (loss)	(379,888)		947		(1,007)		12,323		(367,625)
Balance at September 30, 2021	$	2,795,684	$	(3,757)	$	22,295	$	(152,603)	$	2,661,619	Nine Months Ended September 30, 2020
---	---	---	---	---	---	---	---	---	---	---
	Available<br>for Sale<br>Assets		Deferred<br>Acquisition<br>Costs		Foreign<br>Exchange		Pension<br>Adjustments		Total
Balance at January 1, 2020	$	1,982,650	$	(5,916)	$	12,058	$	(143,962)	$	1,844,830
Other comprehensive income (loss) before reclassifications, net of tax	669,680		908		(3,928)		—		666,660
Reclassifications, net of tax	29,277		—		—		9,852		39,129
Other comprehensive income (loss)	698,957		908		(3,928)		9,852		705,789
Balance at September 30, 2020	$	2,681,607	$	(5,008)	$	8,130	$	(134,110)	$	2,550,619

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Reclassification adjustments: Reclassification adjustments out of Accumulated Other Comprehensive Income are presented below for the three and nine month periods ended September 30, 2021 and 2020.

	Three Months Ended<br>September 30,				Nine Months Ended September 30,				Affected line items in the Statement of Operations
Component Line Item	2021		2020		2021		2020
Unrealized investment (gains) losses on available for sale assets:
Realized (gains) losses	$	(16,269)	$	10,276	$	(35,925)	$	32,133	Realized (gains) losses
Amortization of (discount) premium	1,670		1,562		4,829		4,927		Net investment income
Total before tax	(14,599)		11,838		(31,096)		37,060
Tax	3,066		(2,486)		6,530		(7,783)		Income taxes
Total after-tax	(11,533)		9,352		(24,566)		29,277
Pension adjustments:
Amortization of prior service cost	158		158		474		474		Other operating expense
Amortization of actuarial (gain) loss	5,040		3,998		15,124		11,997		Other operating expense
Total before tax	5,198		4,156		15,598		12,471
Tax	(1,090)		(873)		(3,275)		(2,619)		Income taxes
Total after-tax	4,108		3,283		12,323		9,852
Total reclassification (after-tax)	$	(7,425)	$	12,635	$	(12,243)	$	39,129

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Note 4—Investments

Portfolio Composition: Summaries of fixed maturities available for sale by amortized cost, fair value, and allowance for credit losses at September 30, 2021 and December 31, 2020, and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) are as follows. Redeemable preferred stock is included within "Corporates, by sector".

	At September 30, 2021
	Amortized<br>Cost		Allowance for Credit Losses		Gross<br>Unrealized<br>Gains		Gross<br>Unrealized<br>Losses		Fair<br><br>Value(1)		% of Total<br><br>Fixed<br><br>Maturities(2)
Fixed maturities available for sale:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	380,193	$	—	$	65,063	$	(140)	$	445,116	2
States, municipalities, and political subdivisions	2,068,436		—		220,945		(8,433)		2,280,948		11
Foreign governments	61,476		—		1,363		(4,382)		58,457		—
Corporates, by sector:
Financial	4,563,734		—		927,421		(12,474)		5,478,681		26
Utilities	1,935,489		—		509,282		(988)		2,443,783		12
Energy	1,603,163		—		364,899		(2,131)		1,965,931		9
Other corporate sectors	6,867,918		—		1,462,369		(15,339)		8,314,948		39
Total corporates	14,970,304		—		3,263,971		(30,932)		18,203,343		86
Collateralized debt obligations	36,088		—		27,073		—		63,161		—
Other asset-backed securities	105,531		—		5,046		(736)		109,841		1
Total fixed maturities	$	17,622,028	$	—	$	3,583,461	$	(44,623)	$	21,160,866	100

(1)Amount reported in the balance sheet.

(2)At fair value.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

	At December 31, 2020
	Amortized<br>Cost		Allowance for Credit Losses		Gross<br>Unrealized<br>Gains		Gross<br>Unrealized<br>Losses		Fair<br><br>Value(1)		% of Total<br><br>Fixed<br><br>Maturities(2)
Fixed maturities available for sale:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	380,602	$	—	$	87,272	$	(43)	$	467,831	2
States, municipalities, and political subdivisions	1,880,607		—		251,291		(315)		2,131,583		10
Foreign governments	52,913		—		2,635		(898)		54,650		—
Corporates, by sector:
Financial	4,404,203		—		1,016,813		(24,221)		5,396,795		26
Utilities	1,975,460		—		608,595		(108)		2,583,947		12
Energy	1,623,970		(3,346)		346,197		(3,083)		1,963,738		9
Other corporate sectors	6,687,644		—		1,727,366		(6,218)		8,408,792		40
Total corporates	14,691,277		(3,346)		3,698,971		(33,630)		18,353,272		87
Collateralized debt obligations	57,007		—		23,460		(8,869)		71,598		—
Other asset-backed securities	134,739		—		3,614		(3,778)		134,575		1
Total fixed maturities	$	17,197,145	$	(3,346)	$	4,067,243	$	(47,533)	$	21,213,509	100

(1)Amount reported in the balance sheet.

(2)At fair value.

A schedule of fixed maturities available for sale by contractual maturity date at September 30, 2021 is shown below on an amortized cost basis, net of allowance for credit losses, and on a fair value basis. Actual disposition dates could differ from contractual maturities due to call or prepayment provisions.

	At September 30, 2021
	Amortized<br>Cost, net		Fair<br>Value
Fixed maturities available for sale:
Due in one year or less	$	104,924	$	106,663
Due after one year through five years	845,481		938,870
Due after five years through ten years	1,806,609		2,160,941
Due after ten years through twenty years	6,583,636		8,359,748
Due after twenty years	8,139,586		9,421,456
Mortgage-backed and asset-backed securities	141,792		173,188
	$	17,622,028	$	21,160,866

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Analysis of Investment Operations: "Net investment income" for the three and nine month periods ended September 30, 2021 and 2020 is summarized as follows:

	Three Months Ended<br>September 30,					Nine Months Ended<br>September 30,
	2021		2020		% Change	2021		2020		% Change
Fixed maturities available for sale	$	223,287	$	217,900	2	$	668,284	$	652,583	2
Policy loans	11,376		11,241		1	33,968		33,572		1
Other long-term investments(1)	9,390		6,925		36	26,432		18,694		41
Short-term investments	10		88		(89)	20		529		(96)
	244,063		236,154		3	728,704		705,378		3
Less investment expense	(5,088)		(4,722)		8	(15,601)		(13,387)		17
Net investment income	$	238,975	$	231,432	3	$	713,103	$	691,991	3

(1)For the three months ended September 30, 2021 and 2020, the investment funds, accounted for under the fair value option method, recorded $7.1 million and $4.0 million of distributions, respectively in net investment income. For the nine months ended September 30, 2021 and 2020, the investment funds, accounted for under the fair value option method, recorded $19.4 million and $10.5 million of distributions, respectively in net investment income. Refer to Other Long-Term Investments below for further discussion on the investment funds.

Selected information about sales of fixed maturities available for sale is as follows:

	Three Months Ended<br>September 30,				Nine Months Ended<br>September 30,
	2021		2020		2021		2020
Fixed maturities available for sale:
Proceeds from sales(1)	$	17,085	$	661	$	91,795	$	52,681
Gross realized gains	304		—		1,438		2,642
Gross realized losses	—		(38,782)		(12,101)		(39,153)

(1)There were no unsettled sales in the periods ended September 30, 2021 and 2020.

An analysis of "Realized gains (losses)" is as follows:

	Three Months Ended<br>September 30,				Nine Months Ended<br>September 30,
	2021		2020		2021		2020
Realized investment gains (losses):
Fixed maturities available for sale:
Sales and other(1)	$	16,269	$	(38,608)	$	32,578	$	(27,746)
Provision for credit losses	—		28,332		3,346		(4,387)
Fair value option—change in fair value	1,585		12,053		14,013		(6,798)
Other investments	1,935		358		6,663		10,179
Realized gains (losses) from investments	19,789		2,135		56,600		(28,752)
Realized loss on redemption of debt	(9,314)		(634)		(9,314)		(634)
	10,475		1,501		47,286		(29,386)
Applicable tax	(2,200)		463		(9,930)		6,949
Realized gains (losses), net of tax	$	8,275	$	1,964	$	37,356	$	(22,437)

(1)During the three months ended September 30, 2021 and 2020, the Company recorded $0 and $65.8 million of exchanges of fixed maturities (noncash transactions) that resulted in $0 and $0, respectively in realized gains (losses). During the nine months ended September 30, 2021 and 2020, the Company recorded $108.3 million and $152.1 million of exchanges of fixed maturities (noncash transactions) that resulted in $25.2 million and $7.9 million, respectively in realized gains (losses).

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Fair Value Measurements: The following tables represent the fair value of fixed maturities measured on a recurring basis at September 30, 2021 and December 31, 2020:

	Fair Value Measurement at September 30, 2021 Using:
	Quoted Prices in<br>Active Markets<br>for Identical<br>Assets (Level 1)			Significant Other<br>Observable<br>Inputs (Level 2)			Significant<br>Unobservable<br>Inputs (Level 3)			Total Fair<br>Value
Fixed maturities available for sale
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	—		$	445,116		$	—		$	445,116
States, municipalities, and political subdivisions	—			2,280,948			—			2,280,948
Foreign governments	—			58,457			—			58,457
Corporates, by sector:
Financial	—			5,306,960			171,721			5,478,681
Utilities	—			2,288,585			155,198			2,443,783
Energy	—			1,952,029			13,902			1,965,931
Other corporate sectors	—			8,001,599			313,349			8,314,948
Total corporates	—			17,549,173			654,170			18,203,343
Collateralized debt obligations	—			—			63,161			63,161
Other asset-backed securities	—			109,841			—			109,841
Total fixed maturities	$	—		$	20,443,535		$	717,331		$	21,160,866
Percentage of total	—		%	97		%	3		%	100		%
	Fair Value Measurement at December 31, 2020 Using:
---	---	---	---	---	---	---	---	---	---	---	---	---
	Quoted Prices in<br>Active Markets<br>for Identical<br>Assets (Level 1)			Significant Other<br>Observable<br>Inputs (Level 2)			Significant<br>Unobservable<br>Inputs (Level 3)			Total Fair<br>Value
Fixed maturities available for sale
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	—		$	467,831		$	—		$	467,831
States, municipalities, and political subdivisions	—			2,131,583			—			2,131,583
Foreign governments	—			54,650			—			54,650
Corporates, by sector:
Financial	—			5,222,066			174,729			5,396,795
Utilities	—			2,400,602			183,345			2,583,947
Energy	—			1,925,549			38,189			1,963,738
Other corporate sectors	—			8,090,550			318,242			8,408,792
Total corporates	—			17,638,767			714,505			18,353,272
Collateralized debt obligations	—			—			71,598			71,598
Other asset-backed securities	—			121,705			12,870			134,575
Total fixed maturities	$	—		$	20,414,536		$	798,973		$	21,213,509
Percentage of total	—		%	96		%	4		%	100		%

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

The following tables represent changes in fixed maturities measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

	Analysis of Changes in Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Asset-<br><br>backed Securities			Collateralized<br>Debt<br>Obligations			Corporates			Total
Balance at January 1, 2021	$	12,870		$	71,598		$	714,505		$	798,973
Included in realized gains / losses	(82)			(6,787)			2,733			(4,136)
Included in other comprehensive income	63			12,482			(15,346)			(2,801)
Acquisitions	—			—			25,000			25,000
Sales	(12,851)			(13,213)			—			(26,064)
Amortization	—			3,388			8			3,396
Other(1)	—			(4,307)			(72,730)			(77,037)
Transfers into Level 3(2)	—			—			—			—
Transfers out of Level 3(2)	—			—			—			—
Balance at September 30, 2021	$	—		$	63,161		$	654,170		$	717,331
Percent of total fixed maturities	—		%	—		%	3		%	3		%

(1)Includes capitalized interest, foreign exchange adjustments, and principal repayments.

(2)Considered to be transferred at the end of the period. Transfers into Level 3 occur when observable inputs are no longer available. Transfers out of Level 3 occur when observable inputs become available.

	Analysis of Changes in Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Asset-<br><br>backed Securities			Collateralized<br>Debt<br>Obligations			Corporates			Total
Balance at January 1, 2020	$	13,177		$	74,104		$	672,128		$	759,409
Included in realized gains / losses	—			—			1,213			1,213
Included in other comprehensive income	(318)			(5,220)			11,324			5,786
Acquisitions	—			—			17,820			17,820
Sales	—			—			—			—
Amortization	—			3,415			11			3,426
Other(1)	109			(3,642)			(38,278)			(41,811)
Transfers into Level 3(2)	—			—			—			—
Transfers out of Level 3(2)	—			—			—			—
Balance at September 30, 2020	$	12,968		$	68,657		$	664,218		$	745,843
Percent of total fixed maturities	—		%	1		%	3		%	4		%

(1)Includes capitalized interest, foreign exchange adjustments, and principal repayments.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

The following table presents changes in unrealized gains or (losses) for the period included in other comprehensive income for assets held at the end of the reporting period for Level 3s:

	Changes in Unrealized Gains (Losses) included in Other Comprehensive Income for Assets Held at the End of the Period
	Asset-<br>backed Securities		Collateralized<br>Debt<br>Obligations		Corporates		Total
At September 30, 2021	$	63	$	12,482	$	(15,346)	$	(2,801)
At September 30, 2020	(318)		(5,220)		11,324		5,786

Unrealized Loss Analysis: The following table discloses information about fixed maturities available for sale in an unrealized loss position.

	Less than Twelve Months	Twelve Months or Longer	Total
Number of issues (CUSIPs) held:
As of September 30, 2021	242	29	271
As of December 31, 2020	54	24	78

Globe Life's entire fixed maturity portfolio consisted of 1,981 issues by 813 different issuers at September 30, 2021 and 1,900 issues by 777 different issuers at December 31, 2020. The weighted-average quality rating of all unrealized loss positions at amortized cost was A and BBB- as of September 30, 2021 and December 31, 2020, respectively.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

The following table discloses unrealized investment losses by class and major sector of fixed maturities available for sale for which an allowance for credit losses has not been recorded at September 30, 2021.

Gross unrealized losses may fluctuate quarter over quarter due to adverse factors in the market that affect our holdings, such as changes in interest rates or credit spreads. The Company considers many factors when determining whether an allowance for a credit loss should be recorded. While the Company holds securities that may be in an unrealized loss position from time to time, Globe Life does not intend to sell and it is likely that management will not be required to sell the fixed maturities prior to their anticipated recovery or maturity due to the strong cash flows generated by its insurance operations.

Analysis of Gross Unrealized Investment Losses

	At September 30, 2021
	Less than Twelve Months				Twelve Months or Longer				Total
	Fair<br>Value		Unrealized<br>Loss		Fair<br>Value		Unrealized<br>Loss		Fair<br>Value		Unrealized<br>Loss
Fixed maturities available for sale:
Investment grade securities:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	2,033	$	(37)	$	1,960	$	(103)	$	3,993	$	(140)
States, municipalities and political subdivisions	324,878		(8,330)		1,623		(103)		326,501		(8,433)
Foreign governments	20,088		(2,114)		11,017		(2,268)		31,105		(4,382)
Corporates, by sector:
Financial	154,075		(3,836)		32,692		(1,972)		186,767		(5,808)
Utilities	21,841		(736)		2,511		(252)		24,352		(988)
Energy	86,710		(911)		—		—		86,710		(911)
Other corporate sectors	172,274		(6,871)		17,555		(2,661)		189,829		(9,532)
Total corporates	434,900		(12,354)		52,758		(4,885)		487,658		(17,239)
Collateralized debt obligations	—		—		—		—		—		—
Other asset-backed securities	—		—		—		—		—		—
Total investment grade securities	781,899		(22,835)		67,358		(7,359)		849,257		(30,194)
Below investment grade securities:
States, municipalities and political subdivisions	—		—		—		—		—		—
Corporates, by sector:
Financial	5,479		(4)		55,878		(6,662)		61,357		(6,666)
Utilities	—		—		—		—		—		—
Energy	—		—		26,869		(1,220)		26,869		(1,220)
Other corporate sectors	—		—		26,890		(5,807)		26,890		(5,807)
Total corporates	5,479		(4)		109,637		(13,689)		115,116		(13,693)
Collateralized debt obligations	—		—		—		—		—		—
Other asset-backed securities	—		—		12,882		(736)		12,882		(736)
Total below investment grade securities	5,479		(4)		122,519		(14,425)		127,998		(14,429)
Total fixed maturities	$	787,378	$	(22,839)	$	189,877	$	(21,784)	$	977,255	$	(44,623)

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

The following table discloses unrealized investment losses by class and major sector of fixed maturities available for sale at December 31, 2020.

Analysis of Gross Unrealized Investment Losses

	At December 31, 2020
	Less than Twelve Months				Twelve Months or Longer				Total
	Fair<br>Value		Unrealized<br>Loss		Fair<br>Value		Unrealized<br>Loss		Fair<br>Value		Unrealized<br>Loss
Fixed maturities available for sale:
Investment grade securities:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	2,006	$	(43)	$	—	$	—	$	2,006	$	(43)
States, municipalities and political subdivisions	32,910		(315)		—		—		32,910		(315)
Foreign governments	19,532		(898)		—		—		19,532		(898)
Corporates, by sector:
Financial	117,762		(2,564)		6,333		(2,168)		124,095		(4,732)
Utilities	2,726		(108)		—		—		2,726		(108)
Energy	1,692		(8)		14,871		(106)		16,563		(114)
Other corporate sectors	21,882		(720)		—		—		21,882		(720)
Total corporates	144,062		(3,400)		21,204		(2,274)		165,266		(5,674)
Collateralized debt obligations	—		—		—		—		—		—
Other asset-backed securities	28,864		(1,051)		5		—		28,869		(1,051)
Total investment grade securities	227,374		(5,707)		21,209		(2,274)		248,583		(7,981)
Below investment grade securities:
States, municipalities and political subdivisions	—		—		—		—		—		—
Corporates, by sector:
Financial	6,822		(36)		115,093		(19,453)		121,915		(19,489)
Utilities	—		—		—		—		—		—
Energy	18,432		(757)		38,720		(2,212)		57,152		(2,969)
Other corporate sectors	25,711		(3,588)		19,516		(1,910)		45,227		(5,498)
Total corporates	50,965		(4,381)		173,329		(23,575)		224,294		(27,956)
Collateralized debt obligations	—		—		11,131		(8,869)		11,131		(8,869)
Other asset-backed securities	—		—		11,223		(2,727)		11,223		(2,727)
Total below investment grade securities	50,965		(4,381)		195,683		(35,171)		246,648		(39,552)
Total fixed maturities	$	278,339	$	(10,088)	$	216,892	$	(37,445)	$	495,231	$	(47,533)

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Fixed Maturities, Allowance for Credit Losses: A summary of the activity in the allowance for credit losses is as follows.

	Three Months Ended<br>September 30,				Nine Months Ended<br>September 30,
	2021		2020		2021		2020
Allowance for credit losses beginning balance	$	—	$	32,719	$	3,346	$	—
Additions to allowance for which credit losses were not previously recorded	—		4,387		—		37,106
Additions (reductions) to allowance for fixed maturities that previously had an allowance	—		—		—		—
Reduction of allowance for which the Company intends to sell or more likely than not will be required to sell or sold during the period	—		(32,719)		(3,346)		(32,719)
Allowance for credit losses ending balance	$	—	$	4,387	$	—	$	4,387

As of September 30, 2021 and December 31, 2020, the Company did not have any fixed maturities in non-accrual status.

Other Long-Term Investments: Other long-term investments consist of the following assets:

	September 30,<br>2021		December 31, 2020
Investment funds	$	586,223	$	385,038
Commercial mortgage loan participations	137,072		160,602
Other	9,882		1,341
Total	$	733,177	$	546,981

The investment funds consist of limited partnerships whereby the Company has a pro-rata share of ownership ranging from 1% to 20%. For each investment, the Company has elected the fair value option, but would have been otherwise accounted for as an equity method investment. The fair value option is assessed for each individual investment and concluded at the inception of the investment. Additionally, each investment is evaluated under ASC 810, Consolidation to determine if it is a variable interest entity and would qualify for consolidation; none of the investments qualify for consolidation as the Company is not the primary beneficiary in any of these investments.

The investments are reported at the Company's pro-rata share of the investment fund's net asset value or its equivalent (NAV) as a practical expedient for fair value. Changes in the net asset value are recorded in "Realized gains (losses)" on the Condensed Consolidated Statements of Operations. Distributions received from the funds arise from income generated by the underlying investments as well as the liquidation of the underlying investments. Periodic distributions are recorded in net investment income until cumulative distributions exceed our pro-rata share of operating earnings at which point the distributions will reduce the carrying value. Our maximum exposure to loss is equal to the outstanding carrying value and future funding commitments.

The Company did not commit to any new investment funds during the quarter. The Company had $56 million of capital called during the quarter from existing investment funds, reducing our unfunded commitments. Our unfunded commitments were $357 million as of September 30, 2021.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

The following table presents additional information about the Company's investment funds as of September 30, 2021 and December 31, 2020 at fair value:

	Fair Value				Unfunded Commitments
Investment Category	September 30,<br>2021		December 31, 2020		September 30,<br>2021		Redemption Term/Notice
Commercial mortgage loans	$	397,723	$	227,050	$	124,913	Portion non-redeemable and fully redeemable after 6 month period, subject to fund liquidity/discretion of General Partner. Expected life is 7 years for non-redeemable fund.
Opportunistic credit	170,117		157,461		—		Initial 2 year lock on each new investment/semi-annual withdrawals thereafter/full redemption within 36 month period.
Other	18,383		527		232,100		Fully redeemable with varying terms and non-redeemable.
Total investment funds	$	586,223	$	385,038	$	357,013

Commercial Mortgage Loan Participations (commercial mortgage loans): Summaries of commercial mortgage loans by property type and geographical location at September 30, 2021 and December 31, 2020 are as follows:

	September 30, 2021			December 31, 2020
	Carrying Value		% of Total	Carrying Value		% of Total
Property type:
Mixed use	$	54,042	39	$	49,002	31
Office	9,137		7	36,153		22
Hospitality	22,550		17	22,605		14
Retail	19,754		14	19,319		12
Industrial	17,900		13	17,900		11
Multi-family	14,873		11	19,128		12
Total recorded investment	138,256		101	164,107		102
Less allowance for credit losses	(1,184)		(1)	(3,505)		(2)
Carrying value, net of allowance for credit losses	$	137,072	100	$	160,602	100	September 30, 2021	December 31, 2020
---	---	---	---	---	---	---
	Carrying Value		% of Total	Carrying Value		% of Total
Geographic location:
California	$	64,519	47	$	61,610	38
Virginia	—		—	27,019		17
New York	18,111		13	16,602		10
Pennsylvania	11,672		9	11,314		7
Indiana	9,717		7	9,717		6
Florida	8,182		6	12,420		8
Other	26,055		19	25,425		16
Total recorded investment	138,256		101	164,107		102
Less allowance for credit losses	(1,184)		(1)	(3,505)		(2)
Carrying value, net of allowance for credit losses	$	137,072	100	$	160,602	100

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

The following tables are reflective of Management's internal risk ratings of the loan portfolio. Loans are rated low, moderate, and high. The risk categories consider many different factors such as quality of asset, borrower status, as well as macroeconomic factors including COVID-19. These loans, originated in 2017 to 2021, are transitional or under construction and may not yet be income producing. Certain ratios, such as loan to value and debt service coverage ratios, may not be evaluated as the value of the underlying transitional property significantly fluctuates based on completion of the project.

	Net Book Value of Commercial Mortgage Loans Receivable by Year of Origination
	As of September 30, 2021
Risk Rating:	Number of Loans	2021		2020		2019		2018		2017		Total
Low	14	$	—	$	22,473	$	11,345	$	32,958	$	35,209	$	101,985
Moderate	6	—		—		16,517		8,182		—		24,699
High	2	—		—		4,575		6,997		—		11,572
Total commercial mortgage loans	22	$	—	$	22,473	$	32,437	$	48,137	$	35,209	138,256
Less allowance for credit losses on the investment pool												(1,184)
Less allowance for credit losses on individual loans												—
Carrying value, net of valuation allowance												$	137,072
	Net Book Value of Commercial Mortgage Loans Receivable by Year of Origination
---	---	---	---	---	---	---	---	---	---	---	---
	As of December 31, 2020
Risk Rating:	Number of Loans	2020		2019		2018		2017		Total
Low	17	$	20,176	$	14,757	$	33,132	$	61,460	$	129,525
Moderate	4	—		10,640		7,796		—		18,436
High	3	—		4,554		11,592		—		16,146
Total commercial mortgage loans	24	$	20,176	$	29,951	$	52,520	$	61,460	164,107
Less allowance for credit losses on the investment pool										(2,503)
Less allowance for credit losses on individual loans										(1,002)
Carrying value, net of valuation allowance										$	160,602

As of September 30, 2021, the Company evaluated the commercial mortgage loan portfolio on a pool basis to determine the allowance for credit losses. At the end of the period, the Company had 22 loans in the portfolio. For the nine months ended September 30, 2021, the allowance for credit losses decreased by $2.3 million to $1.2 million. The provision for credit losses is included in "Realized gains (losses)" in the CondensedConsolidated StatementsofOperations.

	Three Months Ended<br>September 30,				Nine Months Ended<br>September 30,
	2021		2020		2021		2020
Allowance for credit losses beginning balance	$	1,639	$	3,838	$	3,505	$	—
Cumulative effect of adoption ASU 2016-13	—		—		—		335
Provision (reversal) for credit losses	(455)		(119)		(2,321)		3,384
Loans charge-off	—		—		—		—
Allowance for credit losses ending balance	$	1,184	$	3,719	$	1,184	$	3,719

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

There were no delinquent commercial mortgage loans as of September 30, 2021, compared with one delinquent commercial mortgage at December 31, 2020. As of September 30, 2021 and December 31, 2020, the Company had one commercial mortgage loan in non-accrual status. The Company's unfunded commitment balance to commercial loan borrowers was $34 million as of September 30, 2021.

Note 5—Commitments and Contingencies

Guarantees: The Parent Company has guaranteed letters of credit in connection with its credit facility with a group of banks. The letters of credit were issued by TMK Re, Ltd., a wholly-owned subsidiary, to secure TMK Re, Ltd.’s obligation for claims on certain policies reinsured by TMK Re, Ltd. that were sold by other Globe Life insurance subsidiaries. These letters of credit facilitate TMK Re, Ltd.’s ability to reinsure the business of Globe Life's insurance carriers. The agreement was amended on September 30, 2021 and now expires in 2026. The maximum amount of letters of credit available is $250 million. The Parent Company would be liable to the extent that TMK Re, Ltd. does not pay the reinsured party. As of September 30, 2021 and December 31, 2020, the outstanding balance was $135 million.

Litigation: Globe Life Inc. (formerly Torchmark Corporation) and its subsidiaries, in common with the insurance industry in general, are subject to litigation, including putative class action litigation, alleged breaches of contract, torts, including bad faith and fraud claims based on alleged wrongful or fraudulent acts of agents of the Parent Company's insurance subsidiaries, employment discrimination, and miscellaneous other causes of action. Based upon information presently available, and in light of legal and other factual defenses available to the Parent Company and its subsidiaries, management does not believe that it is reasonably possible that such litigation will have a material adverse effect on Globe Life's financial condition, future operating results or liquidity; however, assessing the eventual outcome of litigation necessarily involves forward-looking speculation as to judgments to be made by judges, juries and appellate courts in the future. This bespeaks caution, particularly in states with reputations for high punitive damage verdicts. Globe Life's management recognizes that large punitive damage awards bearing little or no relation to actual damages continue to be awarded by juries in jurisdictions in which the Company has substantial business, creating the potential for unpredictable material adverse judgments in any given punitive damage suit.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Note 6—Liability for Unpaid Claims

Activity in the liability for unpaid health claims is summarized as follows:

	September 30,<br>2021		December 31,<br>2020
Balance at beginning of period	$	162,261	$	163,808
Incurred related to:
Current year	480,487		584,936
Prior year	(20,961)		(14,829)
Total incurred	459,526		570,107
Paid related to:
Current year	339,773		442,127
Prior year	116,374		129,527
Total paid	456,147		571,654
Balance at end of period	$	165,640	$	162,261

Below is the reconciliation of the liability of "Policy claims and other benefits payable" in the Condensed Consolidated Balance Sheets.

	September 30,<br>2021		December 31,<br>2020
Policy claims and other benefits payable:
Life insurance	$	230,274	$	237,246
Health insurance	165,640		162,261
Total	$	395,914	$	399,507

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Note 7—Postretirement Benefits

Globe Life has qualified noncontributory defined benefit pension plans (Pension Plans) and contributory savings plans that cover substantially all employees. There is also a nonqualified noncontributory supplemental executive retirement plan (SERP) that covers a limited number of officers. The tables included herein will focus on the Pension Plans and SERP.

Pension Assets: The following table presents the assets of the Company's Pension Plans at September 30, 2021 and December 31, 2020.

Pension Assets by Component at September 30, 2021

	Fair Value Determined by:
	Quoted Prices in<br><br>Active Markets<br><br>for Identical<br><br>Assets (Level 1)		Significant<br><br>Observable<br><br>Inputs (Level 2)		Significant<br><br>Unobservable<br><br>Inputs (Level 3)		Total<br><br>Amount		% to<br><br>Total
Corporate bonds:
Financial	$	—	$	53,927	$	—	$	53,927	9
Utilities	—		44,135		—		44,135		8
Energy	—		22,945		—		22,945		4
Other corporates	—		89,212		—		89,212		16
Total corporate bonds	—		210,219		—		210,219		37
Exchange traded fund(1)	283,277		—		—		283,277		49
Other bonds	—		244		—		244		—
Guaranteed annuity contract(2)	—		34,910		—		34,910		6
Short-term investments	9,605		—		—		9,605		2
Other	16,214		—		—		16,214		3
	$	309,096	$	245,373	$	—	554,469		97
Other long-term investments(3)							14,455		3
Total pension assets							$	568,924	100

(1)A fund including marketable securities that mirror the S&P 500 index.

(2)Representing a guaranteed annuity contract issued by Globe Life Inc.'s subsidiary, American Income Life Insurance Company, to fund the obligations of the American Income Life Insurance Company Non-Exempt Employees Defined Benefit Pension Plan ("American Income Pension Plan").

(3)Included in other long-term investments is an investment fund that reports the Globe Life Inc. Pension Plan's pro-rata share of the limited partnership's net asset value per share or its equivalent (NAV), as a practical expedient for fair value. The Globe Life Inc. Pension Plan owns less than 1% of the investment fund. As of September 30, 2021, the expected term of the investment fund is approximately 3 years and the commitment of the investment is fully funded. The investment is non-redeemable.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Pension Assets by Component at December 31, 2020

	Fair Value Determined by:
	Quoted Prices in<br><br>Active Markets<br><br>for Identical<br><br>Assets (Level 1)		Significant<br><br>Observable<br><br>Inputs (Level 2)		Significant<br><br>Unobservable<br><br>Inputs (Level 3)		Total<br><br>Amount		% to<br><br>Total
Corporate bonds:
Financial	$	—	$	52,252	$	—	$	52,252	10
Utilities	—		45,888		—		45,888		9
Energy	—		22,480		—		22,480		4
Other corporates	—		88,983		—		88,983		17
Total corporate bonds	—		209,603		—		209,603		40
Exchange traded fund(1)	245,170		—		—		245,170		46
Other bonds	—		258		—		258		—
Guaranteed annuity contract(2)	—		30,119		—		30,119		6
Short-term investments	20,960		—		—		20,960		4
Other	7,109		—		—		7,109		1
	$	273,239	$	239,980	$	—	513,219		97
Other long-term investments(3)							16,313		3
Total pension assets							$	529,532	100

(1)A fund including marketable securities that mirror the S&P 500 index.

(2)Representing a guaranteed annuity contract issued by Globe Life Inc.'s subsidiary, American Income Life Insurance Company, to fund the obligations of the American Income Pension Plan.

(3)Included in other long-term investments is an investment fund that reports the Globe Life Inc. Pension Plan's pro-rata share of the limited partnership's net asset value per share or its equivalent (NAV), as a practical expedient for fair value. The Globe Life Inc. Pension Plan owns approximately 1% of the investment fund. As of December 31, 2020, the expected term of the investment fund is approximately 4 years and the commitment of the investment is fully funded. The investment is non-redeemable.

SERP: The following table includes information regarding the SERP.

	Nine Months Ended<br>September 30,
	2021		2020
Premiums paid for insurance coverage	$	2,193	$	2,480
	September 30,<br>2021		December 31,<br>2020
Total investments:
Company owned life insurance	$	54,380	$	51,361
Exchange traded funds	82,000		75,390
	$	136,380	$	126,751

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Pension Plans and SERP Liabilities: The following table presents liabilities for the defined benefit pension plans and SERP at September 30, 2021 and December 31, 2020.

	September 30,<br>2021		December 31,<br>2020
Pension Plans	$	705,371	$	667,753
SERP	96,179		95,560
Pension benefit obligation	$	801,550	$	763,313

Net Periodic Benefit Cost: The following table presents the net periodic benefit costs for the Pension Plans and SERP by expense components for the three and nine months ended September 30, 2021 and 2020.

Components of Net Periodic Benefit Cost

	Three Months Ended<br>September 30,				Nine Months Ended<br>September 30,
	2021		2020		2021		2020
Service cost	$	7,919	$	6,116	$	23,755	$	18,347
Interest cost	5,467		5,653		16,403		16,951
Expected return on assets	(8,083)		(7,390)		(24,249)		(22,171)
Amortization:
Prior service cost	158		158		474		474
Actuarial (gain) loss	4,984		3,921		14,953		11,770
Net periodic benefit cost	$	10,445	$	8,458	$	31,336	$	25,371

Note 8—Earnings Per Share

Earnings per Share: A reconciliation of basic and diluted weighted-average shares outstanding used in the computation of basic and diluted earnings per share is as follows:

	Three Months Ended<br>September 30,		Nine Months Ended<br>September 30,
	2021	2020	2021	2020
Basic weighted average shares outstanding	101,498,408	106,146,809	102,618,327	106,622,704
Weighted average dilutive options outstanding	882,609	906,302	1,171,159	1,082,474
Diluted weighted average shares outstanding	102,381,017	107,053,111	103,789,486	107,705,178
Antidilutive shares	2,601,499	4,007,482	2,349,321	2,415,182

Antidilutive shares are excluded from the calculation of diluted earnings per share.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

Note 9—Debt

The following table presents information about the terms and outstanding balances of Globe Life's debt.

Selected Information about Debt Issues

				As of
				September 30,<br>2021								December 31, 2020
Instrument	Issue Date	Maturity Date	Coupon Rate	Par<br>Value		Unamortized Discount & Issuance Costs		Book<br>Value		Fair<br>Value		Book<br>Value
Senior notes	5/27/1993	5/15/2023	7.875%	$	165,612	$	(463)	$	165,149	$	184,414	$	164,954
Senior notes(1)	9/24/2012	9/15/2022	3.800%	150,000		(334)		149,666		154,767		149,414
Senior notes	9/27/2018	9/15/2028	4.550%	550,000		(5,206)		544,794		637,719		544,328
Senior notes	8/21/2020	8/15/2030	2.150%	400,000		(4,328)		395,672		396,944		395,157
Junior subordinated debentures(2)	—	—	—	—		—		—		—		290,652
Junior subordinated debentures	11/17/2017	11/17/2057	5.275%	125,000		(1,608)		123,392		130,349		123,381
Junior subordinated debentures	6/14/2021	6/15/2061	4.250%	325,000		(7,813)		317,187		331,110		—
				1,715,612		(19,752)		1,695,860		1,835,303		1,667,886
Less current maturity of long-term debt(1)				150,000		(334)		149,666		154,767		—
Total long-term debt				1,565,612		(19,418)		1,546,194		1,680,536		1,667,886
Current maturity of long-term debt(1)				150,000		(334)		149,666		154,767		—
Commercial paper				244,000		(73)		243,927		243,927		254,918
Total short-term debt				394,000		(407)		393,593		398,694		254,918
Total debt				$	1,959,612	$	(19,825)	$	1,939,787	$	2,079,230	$	1,922,804

(1)An additional $150 million par value and book value is held by insurance subsidiaries that eliminates in consolidation.

(2)The $300 million of 6.125% Junior subordinated debentures were redeemed on July 15, 2021.

The commercial paper has the highest priority of all the debt, followed by senior notes then junior subordinated debentures. The Senior Notes due 2023 are noncallable, the remaining senior notes are callable under a make-whole provision, and the junior subordinated debentures are subject to optional redemption five years from issuance. Interest on the 4.25% junior subordinated debentures is payable quarterly while all other long-term debt is payable semi-annually.

Long-term debt: On June 14, 2021, Globe Life completed the issuance and sale of $325 million in aggregate principal amount of 4.25% unsecured Junior Subordinated Debentures due June 15, 2061. The net proceeds from the sale of the Junior Subordinated Debentures were $317 million and were used to redeem the $300 million 6.125% Junior Subordinated Debentures due 2056 plus accrued interest of $1.5 million on July 15, 2021 as well as for general corporate purposes.

Credit facility: On September 30, 2021, Globe Life amended the credit agreement dated August 24, 2020, which provides for a $750 million revolving credit facility that may be increased to $1 billion. The amended credit facility matures September 30, 2026 and may be extended up to two one-year periods upon the Company's request. Pursuant to this agreement, the participating lenders have agreed to make revolving loans to Globe Life and to issue secured or unsecured letters of credit. The Company has not drawn on any of the credit to date.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

The facility is further designated as a back-up credit line for a commercial paper program under which the Company may either borrow from the credit line or issue commercial paper at any time, with total commercial paper outstanding not to exceed the facility maximum of $750 million, less any letters of credit issued. Interest is charged at variable rates. In accordance with the agreement, Globe Life is subject to certain covenants regarding capitalization. As of September 30, 2021, the Company was in full compliance with these covenants.

Federal Home Loan Bank (FHLB) funding: In July 2021, three of our insurance subsidiaries became members of the FHLB of Dallas. FHLB membership provides the insurance subsidiaries with access to various low cost collateralized borrowings and funding agreements. The membership requires ownership of FHLB stock and Globe Life owns $6 million as of the end of the quarter. The stock is restricted for the duration of the membership and recorded at par as required by applicable guidance. The capital stock is included in "Other long-term investments" in the Condensed Consolidated Balance Sheets. As of September 30, 2021, there were no borrowings with the FHLB.

Note 10—Business Segments

Globe Life is organized into four segments: life insurance, supplemental health insurance, annuities, and investments. In addition, other expenses not included in these segments are reported in "Corporate & Other."

Globe Life's reportable insurance segments are based on the insurance product lines it markets and administers: life insurance, supplemental health insurance, and annuities. These major product lines are set out as reportable segments because of the common characteristics of products within these categories, comparability of margins, and the similarity in regulatory environment and management techniques. There is also an investment segment which manages the investment portfolio, debt, and cash flow for the insurance segments and the corporate function. The Company's chief operating decision makers evaluate the overall performance of the operations of the Company in accordance with these segments.

Life insurance products marketed by Globe Life include traditional whole life and term life insurance. Health insurance products are generally guaranteed-renewable and include Medicare Supplement, critical illness, accident, and limited-benefit supplemental hospital and surgical coverage. Annuities include fixed-benefit contracts.

Globe Life markets its insurance products through a number of distribution channels, each of which sells the products of one or more of Globe Life's insurance segments. Our distribution channels consist of the following exclusive agencies: American Income Life Division (American Income), Liberty National Division (Liberty National) and Family Heritage Division (Family Heritage); an independent agency, United American Division (United American); and our Direct to Consumer Division (Direct to Consumer). The tables below present segment premium revenue by each of Globe Life's distribution channels.

Premium Income by Distribution Channel

	Three Months Ended September 30, 2021
	Life			Health			Annuity			Total
Distribution Channel	Amount		% of<br>Total	Amount		% of<br>Total	Amount		% of<br>Total	Amount		% of<br>Total
American Income	$	356,456	49	$	29,070	10	$	—	—	$	385,526	37
Direct to Consumer	240,578		33	18,192		6	—		—	258,770		25
Liberty National	78,528		11	46,716		16	—		—	125,244		12
United American	2,199		—	118,240		39	—		—	120,439		12
Family Heritage	1,286		—	86,925		29	—		—	88,211		9
Other	49,877		7	—		—	—		—	49,877		5
	$	728,924	100	$	299,143	100	$	—	—	$	1,028,067	100

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

	Three Months Ended September 30, 2020
	Life			Health			Annuity			Total
Distribution Channel	Amount		% of<br><br>Total	Amount		% of<br><br>Total	Amount		% of<br><br>Total	Amount		% of<br><br>Total
American Income	$	318,917	47	$	27,029	9	$	—	—	$	345,946	36
Direct to Consumer	227,734		34	19,017		7	—		—	246,751		26
Liberty National	73,815		11	47,199		16	—		—	121,014		13
United American	2,402		—	114,325		40	1		100	116,728		12
Family Heritage	1,081		—	80,225		28	—		—	81,306		8
Other	50,072		8	—		—	—		—	50,072		5
	$	674,021	100	$	287,795	100	$	1	100	$	961,817	100

Premium Income by Distribution Channel

	Nine Months Ended September 30, 2021
	Life			Health			Annuity			Total
Distribution Channel	Amount		% of<br>Total	Amount		% of<br>Total	Amount		% of<br>Total	Amount		% of<br>Total
American Income	$	1,039,047	48	$	85,210	10	$	—	—	$	1,124,257	37
Direct to Consumer	734,046		34	56,002		6	—		—	790,048		26
Liberty National	232,118		11	140,874		16	—		—	372,992		12
United American	6,737		—	351,544		39	1		100	358,282		12
Family Heritage	3,630		—	255,272		29	—		—	258,902		8
Other	149,635		7	—		—	—		—	149,635		5
	$	2,165,213	100	$	888,902	100	$	1	100	$	3,054,116	100
	Nine Months Ended September 30, 2020
---	---	---	---	---	---	---	---	---	---	---	---	---
	Life			Health			Annuity			Total
Distribution Channel	Amount		% of<br><br>Total	Amount		% of<br><br>Total	Amount		% of<br><br>Total	Amount		% of<br><br>Total
American Income	$	930,444	47	$	78,310	9	$	—	—	$	1,008,754	36
Direct to Consumer	682,978		34	57,873		7	—		—	740,851		26
Liberty National	220,009		11	142,230		17	—		—	362,239		13
United American	7,373		—	337,269		39	4		100	344,646		12
Family Heritage	3,144		—	235,195		28	—		—	238,339		8
Other	150,525		8	—		—	—		—	150,525		5
	$	1,994,473	100	$	850,877	100	$	4	100	$	2,845,354	100

Due to the nature of the life insurance industry, Globe Life has no individual or group that would be considered a major customer. Substantially all of Globe Life's business is conducted in the United States.

The measure of profitability established by the chief operating decision makers for the insurance segments is underwriting margin before other income and administrative expenses, in accordance with the manner in which the segments are managed. It essentially represents gross profit margin on insurance products before insurance administrative expenses and consists primarily of premium less net policy benefits, acquisition expenses, and commissions. Required interest on net policy liabilities (benefit reserves less deferred acquisition costs) is reflected as a component of the Investment segment (rather than as a component of underwriting margin in the insurance

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

and annuity segments) in order to match this cost with the investment income earned on the assets supporting the net policy liabilities.

The measure of profitability for the Investment segment is excess investment income, representing the income earned on the investment portfolio in excess of net policy requirements and financing costs associated with Globe Life's debt. Other than the above-mentioned interest allocations, no other intersegment revenues or expenses are recognized. Expenses directly attributable to corporate operations are included in the “Corporate & Other” category. Stock-based compensation expense is considered a corporate expense by Globe Life management and is included in this category. All other unallocated revenues and expenses on a pretax basis, including insurance administrative expense, are also included in the “Corporate & Other” segment category.

Globe Life holds a sizable investment portfolio to support its insurance liabilities, the yield from which is used to offset policy benefit, acquisition, administrative and tax expenses. This yield or investment income is taken into account when establishing premium rates and profitability expectations for its insurance products. From time to time, investments are sold or called, or experience a credit loss event, each of which is reflected by the Company as realized gain (loss)—investments. These gains or losses generally occur as a result of disposition due to issuer calls, compliance with Company investment policies, or other reasons often beyond management’s control. Unlike investment income, realized gains and losses are incidental to insurance operations, and only overall yields are considered when setting premium rates or insurance product profitability expectations. While these gains and losses are not relevant to segment profitability or core operating results, they can have a material positive or negative result on net income. For these reasons, management removes realized investment gains and losses when it views its segment operations.

Management removes items that are related to prior periods when evaluating the operating results of current periods. Management also removes non-operating items unrelated to the Company's core insurance activities when evaluating those results. Therefore, these items are excluded in its presentation of segment results, because accounting guidance requires that operating segment results be presented as management views its business. With the exception of the administrative settlements noted in the paragraphs above, all of these items are included in “Other operating expense” in the Condensed Consolidated Statements of Operations for the appropriate year. See additional detail below in the tables.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

The following tables set forth a reconciliation of Globe Life's revenues and operations by segment to its major income statement line items. See Note—1 Significant Accounting Policies for additional information concerning reconciling items of segment profits to pretax income.

	Three Months Ended September 30, 2021
	Life		Health		Annuity		Investment		Corporate & Other		Adjustments			Consolidated
Revenue:
Premium	$	728,924	$	299,143	$	—	$	—	$	—	$	—		$	1,028,067
Net investment income	—		—		—		238,975		—		—			238,975
Other income	—		—		—		—		321		—			321
Total revenue	728,924		299,143		—		238,975		321		—			1,267,363
Expenses:
Policy benefits	516,196		187,906		7,303		—		—		—			711,405
Required interest on reserves	(185,295)		(25,859)		(10,034)		221,188		—		—			—
Required interest on DAC	55,066		7,203		64		(62,333)		—		—			—
Amortization of acquisition costs	122,311		28,799		483		—		—		—			151,593
Commissions, premium taxes, and non-deferred acquisition costs	58,652		24,116		6		—		—		—			82,774
Insurance administrative expense(1)	—		—		—		—		68,036		—			68,036
Parent expense	—		—		—		—		2,176		2,397		(2)	4,573
Stock-based compensation expense	—		—		—		—		7,776		—			7,776
Interest expense	—		—		—		20,886		—		—			20,886
Total expenses	566,930		222,165		(2,178)		179,741		77,988		2,397			1,047,043
Subtotal	161,994		76,978		2,178		59,234		(77,667)		(2,397)			220,320
Non-operating items	—		—		—		—		—		2,397		(2)	2,397
Measure of segment profitability (pretax)	$	161,994	$	76,978	$	2,178	$	59,234	$	(77,667)	$	—		222,717
Realized gain (loss)—investments														19,789
Realized loss—redemption of debt(3)														(9,314)
Non-operating expenses														(2,397)
Income before income taxes per Condensed Consolidated Statements of Operations														$	230,795

(1)Administrative expense is not allocated to insurance segments.

(2)Non-operating expenses.

(3)In July, 2021, the Company redeemed the $300 million 6.125% junior subordinated notes due 2056 and realized a loss of $9.3 million. Refer to Note 9—Debt for further discussion.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

	Three Months Ended September 30, 2020
	Life		Health		Annuity		Investment		Corporate & Other		Adjustments			Consolidated
Revenue:
Premium	$	674,021	$	287,795	$	1	$	—	$	—	$	—		$	961,817
Net investment income	—		—		—		231,432		—		—			231,432
Other income	—		—		—		—		292		—			292
Total revenue	674,021		287,795		1		231,432		292		—			1,193,541
Expenses:
Policy benefits	459,231		184,237		7,508		—		—		—			650,976
Required interest on reserves	(175,794)		(23,770)		(10,347)		209,911		—		—			—
Required interest on DAC	52,709		6,689		81		(59,479)		—		—			—
Amortization of acquisition costs	114,316		26,026		501		—		—		—			140,843
Commissions, premium taxes, and non-deferred acquisition costs	52,856		21,753		5		—		—		—			74,614
Insurance administrative expense(1)	—		—		—		—		63,008		710		(2)	63,718
Parent expense	—		—		—		—		2,689		323		(2)	3,012
Stock-based compensation expense	—		—		—		—		8,667		—			8,667
Interest expense	—		—		—		21,674		—		—			21,674
Total expenses	503,318		214,935		(2,252)		172,106		74,364		1,033			963,504
Subtotal	170,703		72,860		2,253		59,326		(74,072)		(1,033)			230,037
Non-operating items	—		—		—		—		—		1,033		(2)	1,033
Measure of segment profitability (pretax)	$	170,703	$	72,860	$	2,253	$	59,326	$	(74,072)	$	—		231,070
Realized gain (loss)—investments														2,135
Realized loss—redemption of debt														(634)
Non-operating expenses														(1,033)
Income before income taxes per Condensed Consolidated Statements of Operations														$	231,538

(1)Administrative expense is not allocated to insurance segments.

(2)Non-operating expenses.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

	Nine Months Ended September 30, 2021
	Life		Health		Annuity		Investment		Corporate & Other		Adjustments			Consolidated
Revenue:
Premium	$	2,165,213	$	888,902	$	1	$	—	$	—	$	—		$	3,054,116
Net investment income	—		—		—		713,103		—		—			713,103
Other income	—		—		—		—		1,004		—			1,004
Total revenue	2,165,213		888,902		1		713,103		1,004		—			3,768,223
Expenses:
Policy benefits	1,532,298		564,589		21,848		—		—		—			2,118,735
Required interest on reserves	(547,715)		(76,288)		(30,055)		654,058		—		—			—
Required interest on DAC	163,083		21,242		200		(184,525)		—		—			—
Amortization of acquisition costs	366,022		85,138		1,447		—		—		—			452,607
Commissions, premium taxes, and non-deferred acquisition costs	174,130		70,602		20		—		—		—			244,752
Insurance administrative expense(1)	—		—		—		—		201,715		5,089		(2)	206,804
Parent expense	—		—		—		—		7,251		2,397		(3)	9,648
Stock-based compensation expense	—		—		—		—		24,298		—			24,298
Interest expense	—		—		—		63,833		—		—			63,833
Total expenses	1,687,818		665,283		(6,540)		533,366		233,264		7,486			3,120,677
Subtotal	477,395		223,619		6,541		179,737		(232,260)		(7,486)			647,546
Non-operating items	—		—		—		—		—		7,486		(2,3)	7,486
Measure of segment profitability (pretax)	$	477,395	$	223,619	$	6,541	$	179,737	$	(232,260)	$	—		655,032
Realized gain (loss)—investments														56,600
Realized loss—redemption of debt(3)														(9,314)
Legal proceedings														(5,089)
Non-operating expenses														(2,397)
Income before income taxes per Condensed Consolidated Statements of Operations														$	694,832

(1)Administrative expense is not allocated to insurance segments.

(2)Legal proceedings.

(3)Non-operating expenses.

(4)In July, 2021, the Company redeemed the $300 million 6.125% junior subordinated notes due 2056 and realized a loss of $9.3 million. Refer to Note 9—Debt for further discussion.

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Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(Dollar amounts in thousands, except per share data)

	Nine Months Ended September 30, 2020
	Life		Health		Annuity		Investment		Corporate & Other		Adjustments			Consolidated
Revenue:
Premium	$	1,994,473	$	850,877	$	4	$	—	$	—	$	—		$	2,845,354
Net investment income	—		—		—		691,991		—		—			691,991
Other income	—		—		—		—		1,021		—			1,021
Total revenue	1,994,473		850,877		4		691,991		1,021		—			3,538,366
Expenses:
Policy benefits	1,340,746		546,444		22,571		—		—		—			1,909,761
Required interest on reserves	(520,207)		(69,131)		(31,135)		620,473		—		—			—
Required interest on DAC	156,934		19,790		253		(176,977)		—		—			—
Amortization of acquisition costs	346,426		82,905		1,509		—		—		—			430,840
Commissions, premium taxes, and non-deferred acquisition costs	159,369		70,304		18		—		—		—			229,691
Insurance administrative expense(1)	—		—		—		—		188,194		3,985		(2,3)	192,179
Parent expense	—		—		—		—		7,536		323		(3)	7,859
Stock-based compensation expense	—		—		—		—		26,655		—			26,655
Interest expense	—		—		—		65,295		—		—			65,295
Total expenses	1,483,268		650,312		(6,784)		508,791		222,385		4,308			2,862,280
Subtotal	511,205		200,565		6,788		183,200		(221,364)		(4,308)			676,086
Non-operating items	—		—		—		—		—		4,308		(2,3)	4,308
Measure of segment profitability (pretax)	$	511,205	$	200,565	$	6,788	$	183,200	$	(221,364)	$	—		680,394
Realized gain (loss)—investments														(28,752)
Realized loss—redemption of debt														(634)
Legal proceedings														(3,275)
Non-operating expenses														(1,033)
Income before income taxes per Condensed Consolidated Statements of Operations														$	646,700

(1)Administrative expense is not allocated to insurance segments.

(2)Legal proceedings.

(3)Non-operating expenses.

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CAUTIONARY STATEMENTS

We caution readers regarding certain forward-looking statements contained in the foregoing discussion and elsewhere in this document, and in any other statements made by, or on behalf of Globe Life whether or not in future filings with the Securities and Exchange Commission. Any statement that is not a historical fact, or that might otherwise be considered an opinion or projection concerning the Company or its business, whether express or implied, is meant as and should be considered a forward-looking statement. Such statements represent management's opinions concerning future operations, strategies, financial results or other developments. We specifically disclaim any obligation to update or revise any forward-looking statement because of new information, future developments, or otherwise.

Forward-looking statements are based upon estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond our control, including uncertainties related to the impact of the COVID-19 outbreak on our business operations, financial results and financial condition. If these estimates or assumptions prove to be incorrect, the actual results of Globe Life may differ materially from the forward-looking statements made on the basis of such estimates or assumptions. Whether or not actual results differ materially from forward-looking statements may depend on numerous foreseeable and unforeseeable events or developments, which may be national in scope, related to the insurance industry generally, or applicable to the Company specifically. Such events or developments could include, but are not necessarily limited to:

1.Economic and other conditions, including the COVID-19 pandemic and its impact on the U.S. economy, leading to unexpected changes in lapse rates and/or sales of our policies, as well as levels of mortality, morbidity, and utilization of health care services that differ from Globe Life's assumptions;

2.Regulatory developments, including changes in accounting standards or governmental regulations (particularly those impacting taxes and changes to the Federal Medicare program that would affect Medicare Supplement);

3.Market trends in the senior-aged health care industry that provide alternatives to traditional Medicare (such as Health Maintenance Organizations and other managed care or private plans) and that could affect the sales of traditional Medicare Supplement insurance;

4.Interest rate changes that affect product sales and/or investment portfolio yield;

5.General economic, industry sector or individual debt issuers’ financial conditions (including developments and volatility arising from the COVID-19 pandemic, particularly in certain industries that may comprise part of our investment portfolio) that may affect the current market value of securities we own, or that may impair an issuer’s ability to make principal and/or interest payments due on those securities;

6.Changes in the competitiveness of the Company's products and pricing;

7.Litigation results;

8.Levels of administrative and operational efficiencies that differ from our assumptions (including any reduction in efficiencies resulting from increased costs arising from operating during the COVID-19 pandemic);

9.The ability to obtain timely and appropriate premium rate increases for health insurance policies from our regulators;

10.The customer response to new products and marketing initiatives;

11.Reported amounts in the consolidated financial statements which are based on management estimates and judgments which may differ from the actual amounts ultimately realized;

12.Compromise by a malicious actor or other event that causes a loss of secure data from, or inaccessibility to, our computer and other information technology systems;

13.The severity, magnitude and impact of the COVID-19 pandemic, including effects of the pandemic and the effects of the U.S. and state governments' and other businesses’ response to the pandemic, on our operations and personnel, and on commercial activity and demand for our products; and

14.Our ability to access the commercial paper and debt markets, particularly if such markets become unpredictable or unstable for a certain period as a result of the COVID-19 pandemic.

Readers are also directed to consider other risks and uncertainties described in other documents on file with the Securities and Exchange Commission.

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GLOBE LIFE INC.

Management's Discussion & Analysis

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with Globe Life's Condensed Consolidated Financial Statements and Notes thereto appearing elsewhere in this report.

"Globe Life" and the "Company" refer to Globe Life Inc. and its subsidiaries and affiliates.

Results of Operations

How Globe Life Views Its Operations. Globe Life Inc. is the holding company for a group of insurance companies that market primarily individual life and supplemental health insurance to lower middle to middle income households throughout the United States. We view our operations by segments, which are the insurance product lines of life, supplemental health, and annuities, and the investment segment that supports the product lines. Segments are aligned based on their common characteristics, comparability of the profit margins, and management techniques used to operate each segment.
Insurance Product Line Segments. The insurance product line segments involve the marketing, underwriting, and administration of policies. Each product line is further segmented by the various distribution channels that market the insurance policies. Each distribution channel operates in a niche market offering insurance products designed for that particular market. Whether analyzing profitability of a segment as a whole, or the individual distribution channels within the segment, the measure of profitability used by management is the underwriting margin, as seen below:
Premium revenue<br><br>(Policy obligations)<br><br>(Policy acquisition costs and commissions)<br><br>Underwriting margin
Investment Segment. The investment segment involves the management of our capital resources, including investments and the management of corporate debt and liquidity. Our measure of profitability for the investment segment is excess investment income, as seen below:
Net investment income<br><br>(Required interest on net policy liabilities)<br><br>(Financing costs)<br><br>Excess investment income

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GLOBE LIFE INC.

Management's Discussion & Analysis

Current Highlights, comparing year-to-date 2021 with 2020.

•Net income as a return on equity (ROE) for the nine months ended September 30, 2021 was 8.9% and net operating income as an ROE, excluding net unrealized gains on the fixed maturity portfolio(1) was 12.5%.

•Total premium increased 7% over the same period in the prior year. Life premium increased 9% for the period from $2.0 billion in 2020 to $2.2 billion in 2021. Life underwriting margin declined 7% from $511 million in 2020 to $477 million in 2021.

•Net investment income increased 3% over the same period in the prior year. Excess investment income declined 2% below the prior year.

•Total net sales increased 9% over the same period in the prior year from $473 million to $518 million.

•Book value per share increased 9% over the same period in the prior year from $77.60 to $84.52. Book value per share, excluding net unrealized gains on the fixed maturity portfolio(1), increased 9% over the prior year from $52.39 to $57.11.

•The Company incurred $82 million of COVID-19 net life claims (net of reserves released upon death) for the nine months ended September 30, 2021 compared with $40 million during the same period last year.

•For the nine months ended September 30, 2021, the Company repurchased 3.2 million shares of Globe Life Inc. common stock at a total cost of $310 million for an average share price of $97.17.

The following graphs represent net income and net operating income for the nine months ended September 30, 2021 and 2020.

As shown in the charts above, net operating income is the consolidated total of segment profits after tax and as such is considered a non-GAAP measure. It has been used consistently by Globe Life's management for many years to evaluate the operating performance of the Company. It differs from net income primarily because it excludes certain non-operating items such as realized gains and losses and certain significant and unusual items included in net income. Net income is the most directly comparable GAAP measure.

(1) Net operating income as an ROE, excluding net unrealized gains on the fixed maturity portfolio, is considered a non-GAAP measure. Management utilizes this measure to view the business without the effect of the net unrealized gains, which are primarily attributable to fluctuation in interest rates on the available-for-sale portfolio. The impact of the adjustment to exclude net unrealized gains on fixed maturities, net of tax is $2.8 billion and $2.7 billion for the nine months ended September 30, 2021 and 2020, respectively.

Book value per share, excluding net unrealized gains on the fixed maturity portfolio, is also considered a non-GAAP measure. Management utilizes this measure to view the book value of the business without the effect of net unrealized gains, which are primarily attributable to fluctuation in interest rates on the available for sale portfolio. The impact of the adjustment to exclude net unrealized gains on fixed maturities is $27.41 and $25.21 for nine months ended September 30, 2021 and 2020, respectively.

Refer to Analysis of Profitability by Segment for non-GAAP reconciliation to GAAP.

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GLOBE LIFE INC.

Management's Discussion & Analysis

Summary of Operations. Net income increased 7% to $567 million during the nine months ended September 30, 2021, compared with $528 million in the same period in 2020. This increase was primarily attributed to $45 million of after tax realized gains on investments in the current period, as compared to $22 million of after tax realized losses on investments in the year-ago period. See further discussion under the caption Investments. The increase in after tax realized gains was partially offset by lower life underwriting results due to higher COVID-19 net life claims. On a diluted per common share basis, net income per common share for the nine months ended September 30, 2021 increased 11% from $4.90 to $5.46.

Net operating income is the consolidated total of segment profits after-tax and as such is considered a non-GAAP measure. Net operating income declined 3% to $536 million for the nine months ended September 30, 2021, compared with $553 million for the same period in 2020 primarily due to COVID-19 net life claims. On a diluted per common share basis, net operating income per common share for the nine months ended September 30, 2021 increased from $5.14 to $5.16.

Despite headwinds with COVID-19, the Company continues to see positive signs in its core operations, including strong sales, favorable persistency and a strong ROE, excluding net unrealized gains on the fixed maturity portfolio.

COVID-19. For the nine months ended September 30, 2021, the Company incurred $82 million of COVID-19 net life claims of which $33 million were incurred in the third quarter. The third quarter COVID-19 net life claims were higher than anticipated primarily due to the impact of the Delta variant, which resulted in higher infection rates and death totals than forecasted. Per the Centers for Disease Control and Prevention (CDC), there were approximately 95,000 U.S. COVID-19 deaths in the third quarter. Compared to prior quarters, the COVID-19 deaths were concentrated in geographies and younger age groups where the Company has greater risk exposure. As such, the Company’s level of COVID-19 net life claims increased in the quarter to approximately $3.5 million per 10,000 U.S. deaths, up from an average of approximately $2 million per 10,000 U.S. deaths incurred in prior periods. While changes in the average age of deaths from COVID-19 and the geographies where these deaths occur will affect this ratio, we anticipate this level of losses per U.S. deaths to continue through the fourth quarter and be in the range of $3 million to $4 million per 10,000 U.S. deaths in 2022.

For the full year and at the mid-point of our guidance, we estimate COVID-19 net life claims will be between $110 million to $125 million based on an estimate of approximately 75,000 to 125,000 U.S. COVID-19 deaths in the fourth quarter. This estimate of U.S. deaths is based on various third-party models. The projected life claims are dependent on this estimate and many other variables, including, but not limited to, the timing and availability of effective treatments for the disease, vaccination rates, and effectiveness of vaccines, impact from potential variants, and the actual ages and geographic areas in which infections and deaths occur.

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GLOBE LIFE INC.

Management's Discussion & Analysis

Globe Life's operations on a segment-by-segment basis are discussed in depth below. Net operating income has been used consistently by management for many years to evaluate the operating performance of the Company, and is a measure commonly used in the life insurance industry. It differs from GAAP net income primarily because it excludes certain non-operating items such as realized gains and losses and other significant and unusual items included in net income. Management believes an analysis of net operating income is important in understanding the profitability and operating trends of the Company’s business. Net income is the most directly comparable GAAP measure.

Analysis of Profitability by Segment

(Dollar amounts in thousands)

	Nine Months Ended September 30,
	2021		2020		Change		%
Life insurance underwriting margin	$	477,395	$	511,205	$	(33,810)	(7)
Health insurance underwriting margin	223,619		200,565		23,054		11
Annuity underwriting margin	6,541		6,788		(247)		(4)
Excess investment income	179,737		183,200		(3,463)		(2)
Other insurance:
Other income	1,004		1,021		(17)		(2)
Administrative expense	(201,715)		(188,194)		(13,521)		7
Corporate and other	(31,549)		(34,191)		2,642		(8)
Pre-tax total	655,032		680,394		(25,362)		(4)
Applicable taxes	(119,468)		(127,021)		7,553		(6)
Net operating income	535,564		553,373		(17,809)		(3)
Reconciling items, net of tax:
Realized gain (loss)—investments	44,714		(21,936)		66,650
Realized loss—redemption of debt	(7,358)		(501)		(6,857)
Non-operating expenses	(1,894)		(816)		(1,078)
Legal proceedings	(4,020)		(2,587)		(1,433)
Net income	$	567,006	$	527,533	$	39,473	7

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GLOBE LIFE INC.

Management's Discussion & Analysis

In 2021, the largest contributor of total underwriting margin was the life insurance segment and the primary distribution channel was American Income Life Division. The following charts represent the breakdown of total underwriting margin by operating segment and distribution channel for the nine months ended September 30, 2021.

Total premium income rose 7% for the nine months ended September 30, 2021 to $3.1 billion. Total net sales increased 9% to $518 million, when compared with the same period in 2020. Total first-year collected premium (defined in the following section) was $435 million for the 2021 period, compared with $405 million for the 2020 period.

Life insurance premium income increased 9% to $2.2 billion over the prior year total of $2.0 billion. Life net sales rose 11% to $392 million for the first nine months of 2021. First-year collected life premium rose 16% to $318 million. Life underwriting margins, as a percent of premium, declined to 22% in 2021 from 26% in the prior year. Underwriting margin declined to $477 million for the nine months ended September 30, 2021, 7% below the same period in 2020. The decline in the life underwriting margin is primarily due to an estimated $82 million of COVID-19 net life claims incurred during the first nine months of 2021 versus $40 million during the same period in 2020.

Health insurance premium income increased 4% to $889 million over the prior year total of $851 million. Health net sales rose 4% to $125 million for the first nine months of 2021. First-year collected health premium fell 11% to $118 million. Health underwriting margins, as a percent of premium, increased to 25% in 2021 compared with 24% in 2020. Health underwriting margin increased to $224 million for the first nine months of 2021, 11% over the same period in 2020.

Excess investment income, the measure of profitability of our investment segment, declined 2% during 2021 to $180 million from $183 million in the same period in 2020. Excess investment income per common share, reflecting the impact of our share repurchase program, increased 2% to $1.73 from $1.70 when compared with the same period in 2020.

Insurance administrative expenses increased 7% in 2021 when compared with the prior year period. These expenses were 6.6% as a percent of premium during the first nine months of 2021 and 2020.

For the nine months ended September 30, 2021, the Company repurchased 3.2 million Globe Life Inc. shares at a total cost of $310 million for an average share price of $97.17.

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GLOBE LIFE INC.

Management's Discussion & Analysis

The discussions of our segments are presented in the manner we view our operations, as described in Note 10—Business Segments.

We use three statistical measures as indicators of premium growth and sales over the near term: “annualized premium in force,” “net sales,” and “first-year collected premium.”

•Annualized premium in force is defined as the premium income that would be received over the following twelve months at any given date on all active policies if those policies remain in force throughout the twelve-month period. Annualized premium in force is an indicator of potential growth in premium revenue.

•Net sales, a statistical performance measure, is calculated as annualized premium issued, net of cancellations in the first thirty days after issue, except in the case of Direct to Consumer, where net sales is annualized premium issued at the time the first full premium is paid after any introductory offer period has expired. Management considers net sales to be a better indicator of the rate of premium growth than annualized premium issued.

•First-year collected premium is defined as the premium collected during the reporting period for all policies in their first policy year. First-year collected premium takes lapses into account in the first year when lapses are more likely to occur, and thus is a useful indicator of how much new premium is expected to be added to premium income in the future.

See further discussion of the distribution channels below for Life and Health.

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GLOBE LIFE INC.

Management's Discussion & Analysis

LIFE INSURANCE

Life insurance is the Company's predominant segment. During 2021, life premium represented 71% of total premium and life underwriting margin represented 67% of the total. Additionally, investments supporting the reserves for life products produce the majority of excess investment income attributable to the investment segment.

The following table presents the summary of results of life insurance. Further discussion of the results by distribution channel is included below.

Life Insurance

Summary of Results

(Dollar amounts in thousands)

	Nine Months Ended September 30,						Change
	2021			2020
	Amount		% of Premium	Amount		% of Premium	Amount		%
Premium and policy charges	$	2,165,213	100	$	1,994,473	100	$	170,740	9
Policy obligations	1,532,298		71	1,340,746		67	191,552		14
Required interest on reserves	(547,715)		(25)	(520,207)		(26)	(27,508)		5
Net policy obligations	984,583		46	820,539		41	164,044		20
Commissions, premium taxes, and non-deferred acquisition expenses	174,130		8	159,369		8	14,761		9
Amortization of acquisition costs	529,105		24	503,360		25	25,745		5
Total expense	1,687,818		78	1,483,268		74	204,550		14
Insurance underwriting margin	$	477,395	22	$	511,205	26	$	(33,810)	(7)

The lower life insurance underwriting margins for the nine months ended September 30, 2021 are primarily attributed to the increase in COVID-19 net life claims in the current year. The Company incurred $82 million for the nine months ended September 30, 2021, compared with $40 million at the same time in the prior year.

The following table presents Globe Life's life insurance premium by distribution channel.

Life Insurance

Premium by Distribution Channel

(Dollar amounts in thousands)

	Nine Months Ended September 30,						Increase<br>(Decrease)
	2021			2020
	Amount		% of Total	Amount		% of Total	Amount		%
American Income	$	1,039,047	48	$	930,444	47	$	108,603	12
Direct to Consumer	734,046		34	682,978		34	51,068		7
Liberty National	232,118		11	220,009		11	12,109		6
Other	160,002		7	161,042		8	(1,040)		(1)
Total	$	2,165,213	100	$	1,994,473	100	$	170,740	9

Annualized life premium in force was $2.91 billion at September 30, 2021, an increase of 7% over $2.72 billion a year earlier.

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Globe Life Inc.

Management's Discussion & Analysis

An analysis of life net sales, an indicator of new business production, by distribution channel is presented below.

Life Insurance

Net Sales by Distribution Channel

(Dollar amounts in thousands)

	Nine Months Ended September 30,						Increase<br>(Decrease)
	2021			2020
	Amount		% of Total	Amount		% of Total	Amount		%
American Income	$	216,505	55	$	182,091	52	$	34,414	19
Direct to Consumer	115,041		29	126,196		36	(11,155)		(9)
Liberty National	52,357		14	36,866		10	15,491		42
Other	8,361		2	7,688		2	673		9
Total	$	392,264	100	$	352,841	100	$	39,423	11

First-year collected life premium by distribution channel is presented in the table below.

Life Insurance

First-Year Collected Premium by Distribution Channel

(Dollar amounts in thousands)

	Nine Months Ended September 30,						Increase<br>(Decrease)
	2021			2020
	Amount		% of Total	Amount		% of Total	Amount		%
American Income	$	186,143	59	$	157,178	57	$	28,965	18
Direct to Consumer	87,135		27	76,193		28	10,942		14
Liberty National	36,984		12	31,953		12	5,031		16
Other	7,262		2	7,817		3	(555)		(7)
Total	$	317,524	100	$	273,141	100	$	44,383	16

A discussion of life operations by distribution channel follows.

The American Income Life Division markets to members of labor unions and continues to diversify its lead sources by building relationships with other affinity groups, utilizing third-party internet vendor leads, and obtaining referrals to facilitate sustainable growth. This division is Globe Life's largest contributor to life premium of any distribution channel at 48% of the Company's September 30, 2021 total. Net sales increased 19% to $217 million during the first nine months of 2021 compared with $182 million in 2020 for the same period. The underwriting margin, as a percent of premium, was 31% for the nine months ended September 30, 2021, down from 32% in the year-ago period. The lower underwriting margin was primarily due to higher policy obligations as a result of the pandemic including higher policy obligations due to lower policy lapses.

This division incurred $19 million in COVID-19 net life claims, representing approximately 2% of premium, for the nine months ended September 30, 2021 compared with $11 million in COVID-19 net life claims during the year-ago period. The underwriting margin as a percent of premium, at the mid-point of our full year 2021 guidance, is expected to slightly decrease from prior year as result of higher policy obligations due to the pandemic.

This division is anticipating an increase in net sales for the full year 2021 as compared with 2020. Sales growth in our exclusive agencies is generally dependent on growth in the size of the agency force.

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Globe Life Inc.

Management's Discussion & Analysis

Below is the average producing agent count at the end of the period for the American Income Life Division. The average producing agent count is based on the actual count at the end of each week during the year. While the average producing agent count for the nine months ended September 30, 2021 is up substantially from the same period in the prior year, we believe this growth will moderate going forward. Over the past quarter, the agency saw lower new agent recruiting as many new work opportunities became available in this current economy. With the attractiveness of selling products virtually, we believe we will see an increase in agent counts even as COVID-19 moderates.

	At September 30,		Change
	2021	2020	Amount	%
American Income	10,118	8,437	1,681	20

American Income Life continues to focus on growing and strengthening the agency force, specifically through emphasis on agency middle-management growth and additional agency office openings. In addition to offering financial incentives and training opportunities, the agency has made considerable investments in information technology, including launching a customer relationship management (CRM) tool for the agency force. This tool is designed to drive productivity in lead distribution, conservation of business, manager dash boards and new agent recruiting. Additionally, this division has invested in and successfully implemented technology that allows the agency force to engage in virtual recruiting, training and sales activity. Over the past year and through the pandemic, the agents have shifted to primarily a virtual experience with the customers and have generated 80-85% of its sales through virtual presentations. We find this flexibility to be enticing for new recruits as well as a driver of sustainability for our agency force.

The Direct to Consumer Division (DTC) offers adult and juvenile life insurance through a variety of marketing approaches, including direct mail, insert media, and electronic media. In recent years, electronic media production has grown rapidly as management has aggressively increased marketing activities related to internet and mobile technology as well as focused on driving traffic to our inbound call center. The different approaches support and complement one another in the division's efforts to reach the consumer. The DTC's long-term growth has been fueled by constant innovation and name recognition. We continually introduce new initiatives in this division in an attempt to increase response rates.

While the juvenile market is an important source of sales, it also is a vehicle to reach the parents and grandparents of juvenile policyholders, who are more likely to respond favorably to a DTC solicitation for life coverage on themselves in comparison to the general adult population. Also, both juvenile policyholders and their parents are low acquisition-cost targets for sales of additional coverage over time.

DTC net sales declined 9% to $115 million for the nine months ended September 30, 2021 compared with $126 million for the same period in the prior year, primarily due to the record high net life sales in the prior year at the onset of the pandemic. While we expect continued strong sales due to the heightened awareness as to the benefits of life insurance, we anticipate sales levels over the remainder of 2021 will be lower than the same period in 2020. The lower sales for the nine months ended September 30, 2021 compared with the same period in 2020 are reflective of record high sales during 2020 due to unprecedented demand and lower response rates in 2021. Despite the lower sales in 2021 compared with 2020, we still expect our full year sales to be approximately 19% over 2019 levels. We expect favorable persistency to continue over the remainder of this year, leading to higher premiums.

DTC incurred $42 million of COVID-19 net life claims, representing approximately 6% of premium, for the nine months ended September 30, 2021 compared with $22 million for the same period in 2020. DTC’s underwriting margin, as a percent of premium, was 8% for the nine months ended September 30, 2021, which was lower than the 15% result during the same period in 2020 primarily due to higher COVID-19 net life claims in the current period. Additionally, this division will see a decrease in underwriting margin as a percent of premium for the full year 2021 due to higher policy obligations incurred as a result of higher persistency and higher non-COVID-19 net life claims.

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Globe Life Inc.

Management's Discussion & Analysis

The Liberty National Division markets individual life insurance to middle-income household and worksite customers. Recent investments in new sales technologies as well as recent growth in middle management within the agency are expected to help continue this growth. The underwriting margin as a percent of premium was 18% for the nine months ended September 30, 2021, down from 24% during the same period a year ago. The decrease is primarily attributable to higher policy obligations during the nine months ended September 30, 2021 as a result of the COVID-19 pandemic compared with the same period a year ago. This division incurred $18 million of COVID-19 net life claims, representing approximately 8% of premium, for the nine months ended September 30, 2021 compared with $6 million for the same period in 2020. With the division's ability to return to face-to-face customer interaction and the option of virtual sales, the Company is projecting total net life sales to increase for the full year 2021 as compared to the prior year. However, due to increased policy obligations expected to be incurred associated with the pandemic, we anticipate the underwriting margin, as a percent of premium, to be lower for the full year 2021 as compared to 2020.

Below is the average producing agent count at the end of the period for Liberty National Division. As the division gains momentum in the virtual sales environment, the agency should see an increase in recruiting of new agents and an increase in the average producing agent count.

	At September 30,		Change
	2021	2020	Amount	%
Liberty National	2,713	2,531	182	7

The Liberty National Division average producing agent count increased 7% over the prior year comparable period. We continue to execute our long-term plan to grow this agency through expansion from small-town markets in the Southeast to more densely populated areas with larger pools of potential agent recruits and customers. Continued geographic expansion of this agency's presence into more heavily populated, less-penetrated areas will help create long-term agency growth. Additionally, the agency continues to help improve the ability of agents to develop new worksite marketing business. Systems that have been put in place, including the addition of a customer relationship management (CRM) platform and enhanced analytical capabilities, have helped the agents develop additional worksite marketing opportunities as well as improve the productivity of agents selling in the individual life market. Sales were hindered in the first half of 2020 due to difficulties in agents transitioning to a virtual work environment after the onset of the COVID-19 lockdown, as well as mandatory shut-downs of non-essential small businesses which hindered the ability of the division’s agents to prospect at the worksite.

The Other Agencies distribution channels primarily include non-exclusive independent agencies. The Other Agencies contributed $160 million of life premium income, or 7% of Globe Life's total premium income in the nine months ended September 30, 2021, and contributed 2% of net sales for the period.

HEALTH INSURANCE

Health insurance sold by the Company primarily includes Medicare Supplement insurance, accident coverage, and other limited-benefit supplemental health products including cancer, critical illness, heart, and intensive care coverage.

Health premium accounted for 29% of our total premium in the first nine months of 2021, while the health underwriting margin accounted for 32% of total underwriting margin. Health underwriting margin increased 11% to $224 million primarily due to lower policy obligations. The Company continues to emphasize life insurance sales relative to health due to life’s superior long-term profitability and its greater contribution to excess investment income.

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Globe Life Inc.

Management's Discussion & Analysis

The following table presents underwriting margin data for health insurance.

Health Insurance

Summary of Results

(Dollar amounts in thousands)

	Nine Months Ended September 30,						Change
	2021			2020
	Amount		% of<br>Premium	Amount		% of<br>Premium	Amount		%
Premium	$	888,902	100	$	850,877	100	$	38,025	4
Policy obligations	564,589		64	546,444		64	18,145		3
Required interest on reserves	(76,288)		(9)	(69,131)		(8)	(7,157)		10
Net policy obligations	488,301		55	477,313		56	10,988		2
Commissions, premium taxes, and non-deferred acquisition expenses	70,602		8	70,304		8	298		—
Amortization of acquisition costs	106,380		12	102,695		12	3,685		4
Total expense	665,283		75	650,312		76	14,971		2
Insurance underwriting margin	$	223,619	25	$	200,565	24	$	23,054	11

Globe Life markets supplemental health insurance products through a number of distribution channels. The following table is an analysis of our health premium by distribution channel.

Health Insurance

Premium by Distribution Channel

(Dollar amounts in thousands)

	Nine Months Ended September 30,						Increase<br>(Decrease)
	2021			2020
	Amount		% of Total	Amount		% of Total	Amount		%
United American	$	351,544	39	$	337,269	39	$	14,275	4
Family Heritage	255,272		29	235,195		28	20,077		9
Liberty National	140,874		16	142,230		17	(1,356)		(1)
American Income	85,210		10	78,310		9	6,900		9
Direct to Consumer	56,002		6	57,873		7	(1,871)		(3)
Total	$	888,902	100	$	850,877	100	$	38,025	4

Premium related to limited-benefit plans comprise $467 million, or 53%, of the total health premiums, for 2021 compared with $437 million in the same period in the prior year. Premium from Medicare Supplement products comprises the remaining $422 million, or 47% for 2021 compared with $414 million, or 49% in the same period in the prior year.

Annualized health premium in force was $1.27 billion at September 30, 2021, an increase of 8% over $1.17 billion a year earlier.

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Globe Life Inc.

Management's Discussion & Analysis

Presented below is a table of health net sales by distribution channel.

Health Insurance

Net Sales by Distribution Channel

(Dollar amounts in thousands)

	Nine Months Ended September 30,						Increase<br>(Decrease)
	2021			2020
	Amount		% of Total	Amount		% of Total	Amount		%
United American	$	36,876	30	$	39,335	33	$	(2,459)	(6)
Family Heritage	54,111		43	49,314		41	4,797		10
Liberty National	18,943		15	15,820		13	3,123		20
American Income	13,777		11	14,580		12	(803)		(6)
Direct to Consumer	1,707		1	1,608		1	99		6
Total	$	125,414	100	$	120,657	100	$	4,757	4

Health net sales related to limited-benefit plans comprise $87 million, or 70%, of the total health net sales, for 2021, compared with $80 million in the same period in the prior year. Medicare Supplement sales make up the remaining $38 million, or 30% for 2021, compared with $41 million, or 34% in the same period in the prior year.

The following table presents health insurance first-year collected premium by distribution channel.

Health Insurance

First-Year Collected Premium by Distribution Channel

(Dollar amounts in thousands)

	Nine Months Ended September 30,						Increase<br>(Decrease)
	2021			2020
	Amount		% of Total	Amount		% of Total	Amount		%
United American	$	43,038	37	$	59,948	45	$	(16,910)	(28)
Family Heritage	42,835		36	40,425		31	2,410		6
Liberty National	15,049		13	15,399		12	(350)		(2)
American Income	14,220		12	13,859		10	361		3
Direct to Consumer	2,376		2	2,256		2	120		5
Total	$	117,518	100	$	131,887	100	$	(14,369)	(11)

First-year collected premium related to limited-benefit plans comprises $73 million, or 62%, of total first-year collected premium, for 2021 compared with $70 million in the same period in the prior year. First-year collected premium from Medicare Supplement policies makes up the remaining $45 million, or 38% for 2021, compared with $62 million, or 47% in the same period in the prior year.

A discussion of health operations by distribution channel follows.

The United American Division consists of non-exclusive independent agencies who may also sell for other companies. The United American Division was Globe Life's largest health agency in terms of health premium income.

This division is also Globe Life's largest producer of Medicare Supplement insurance. The United American Division represents 82% of all Medicare Supplement premium and 96% of Medicare Supplement net sales. For the nine months ended September 30, 2021, Medicare Supplement premium in this agency rose 4% to $344 million in 2021 over the prior period total of $330 million. Medicare Supplement net sales declined 7% to $37 million in 2021 from the prior year period, primarily as a result of a decrease in individual sales. Underwriting margin as a percent of premium was 15% for the nine months ended September 30, 2021, up from 14% in 2020.

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Globe Life Inc.

Management's Discussion & Analysis

As discussed in Note 1—Significant Accounting Policies, the Company acquired Beazley Benefits, now rebranded as Globe Life Benefits, on August 1, 2021. This distribution channel will enhance the Company's presence in the worksite market by offering group supplemental health insurance solutions to employer groups through brokers. While the acquisition had an immaterial impact on year to date results, we are optimistic about Globe Life Benefits' ability to contribute additional health premium and profits in the future. Operating results for Globe Life Benefits will be included as part of United American Division results.

The Family Heritage Division primarily markets limited-benefit supplemental health insurance in non-urban areas. Most of its policies include a cash-back feature, such as a return of premium, where any excess of premiums over claims paid is returned to the policyholder at the end of a specified period stated within the insurance policy. Underwriting margin as a percent of premium was 27% for the nine months ended September 30, 2021, up from 26% in the year-ago period primarily due to favorable claims experience.

The division experienced a 10% increase in net health sales as compared with the nine-month period a year ago, primarily due to an increase in agent productivity and training. The division will continue to launch incentive programs to help drive an increase in productivity and the number of producing agents.

Below is the average producing agent count at the end of the period for the Family Heritage Division. While the agency has seen a decrease in agent count as compared with 2020, we anticipate that as COVID-19 and the job economy stabilize, agent recruitment opportunities should increase.

	At September 30,		Change
	2021	2020	Amount	%
Family Heritage Division	1,219	1,282	(63)	(5)

The Liberty National Division represented 16% of all Globe Life health premium income for the nine-month period ended September 30, 2021. The Liberty National Division markets limited-benefit supplemental health products consisting primarily of critical illness insurance. Much of this health business is now generated through worksite marketing targeting small businesses of 10 to 100 employees. Health premium at Liberty National Division was $141 million for the nine months ended September 30, 2021, down from $142 million in the year ago period. We anticipate an increase in net health sales in 2021 at this division as the Company has been more able to interact face-to-face with customers than in 2020.

Other distribution. While some of the Company's other distribution channels market health products, their main emphasis is on life insurance. On a combined basis, they accounted for 16% of health premium in 2021 and 16% in 2020. The American Income Life Division primarily markets accident plans. The Direct to Consumer Division primarily markets Medicare Supplements to employer or union-sponsored groups. The Direct to Consumer Division net health sales were $2 million for the nine months ended September 30, 2021 and 2020.

ANNUITIES

Annuities represent an insignificant part of our business. We do not currently market stand-alone fixed or deferred annuity products, favoring instead protection-oriented life and supplemental health insurance products.

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Globe Life Inc.

Management's Discussion & Analysis

INVESTMENTS

We manage our capital resources including investments, debt, and cash flow through the investment segment. Excess investment income represents the profit margin attributable to investment operations and is the measure that we use to evaluate the performance of the investment segment as described in Note 10—Business Segments. It is defined as net investment income less both the required interest on net insurance policy liabilities and the interest cost associated with capital funding or “financing costs.”

Management also views excess investment income per diluted common share as an important and useful measure to evaluate the performance of the investment segment. It is defined as excess investment income divided by the total diluted weighted average shares outstanding, representing the contribution by the investment segment to the consolidated earnings per share of the Company. Since implementing our share repurchase program in 1986, we have used $8.5 billion of excess cash flow at the Parent Company to repurchase Globe Life Inc. common shares after determining that the repurchases provided a greater risk adjusted after-tax return than other investment alternatives. If we had not used this excess cash to repurchase shares, but had instead invested it in interest-bearing assets, we would have earned more investment income and had more shares outstanding. As excess investment income per diluted common share incorporates all capital resources, we view excess investment income per diluted share as a useful measure to evaluate the investment segment.

Excess Investment Income. The following table summarizes Globe Life's investment income, excess investment income, and excess investment income per diluted common share.

Analysis of Excess Investment Income

(Dollar amounts in thousands, except for per share data)

	Nine Months Ended<br>September 30,				Change
	2021		2020		Amount		%
Net investment income	$	713,103	$	691,991	$	21,112	3
Interest on net insurance policy liabilities:
Interest on reserves	(654,058)		(620,473)		(33,585)		5
Interest on deferred acquisition costs	184,525		176,977		7,548		4
Net required interest	(469,533)		(443,496)		(26,037)		6
Financing costs	(63,833)		(65,295)		1,462		(2)
Excess investment income	$	179,737	$	183,200	$	(3,463)	(2)
Excess investment income per diluted share	$	1.73	$	1.70	$	0.03	2
Mean invested assets (at amortized cost)	$	18,846,801	$	17,855,428	$	991,373	6
Average net insurance policy liabilities(1)	10,897,593		10,395,811		501,782		5
Average debt and preferred securities (at amortized cost)	2,060,672		1,841,942		218,730		12

(1)Net of deferred acquisition costs, excluding the associated unrealized gains and losses thereon.

Excess investment income declined $3 million, or 2%, compared with the year-ago period. Excess investment income per diluted common share was $1.73 for the nine months ended September 30, 2021 an increase of 2% over the prior year period . Excess investment income per diluted common share generally increases at a faster pace than excess investment income because the number of diluted shares outstanding generally decreases from year to year as a result of our share repurchase program.

Net investment income for the nine months ended September 30, 2021 was $713 million or 3% greater than the year-ago period. Mean invested assets increased 6% during the first nine months of 2021 over the same period last year. The effective annual yield rate earned on the fixed maturity portfolio was 5.23% in the first nine months of 2021, compared with 5.35% a year earlier. Growth in net investment income has been negatively impacted in recent years by the low interest rate environment during which time we have invested new money at yields lower than our

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Globe Life Inc.

Management's Discussion & Analysis

average portfolio yield. In addition, we have reinvested the proceeds from bonds that matured, were called, or were otherwise disposed of at yield rates less than what we earned on these bonds before their maturity or disposition. We currently expect that the average annual turnover rate of fixed maturity assets will be less than 2% over the next five years and will not have a material negative impact on net investment income. To help mitigate the decline of the portfolio yield over the past few years, the Company has decreased the portion of the investment portfolio allocated to fixed maturity investments by investing in limited partnerships with debt like characteristics that diversify risk and enhance risk adjusted capital adjusted returns on the portfolio. The earned yield on the investment funds for the nine months ended September 30, 2021 was 5.31%. See additional information in Note 4—Investments.

Should the current low interest rate environment continue, the growth of the Company's net investment income will continue to be negatively impacted primarily due to the investment of new money and proceeds from dispositions at rates less than the average portfolio yield rate. While net investment income would grow, it would continue to grow at rates less than the growth in mean invested assets. For the full year 2021, we currently anticipate the average new money yield on our fixed maturity acquisitions to be approximately 30 basis points lower than the rate applicable to our 2020 acquisitions.

Should interest rates, especially long-term rates, rise, Globe Life's net investment income would benefit due to higher interest rates on new investments. While such a rise in interest rates could adversely affect the fair value of the fixed maturities portfolio, we could withstand an increase in interest rates of approximately 145 to 150 basis points before the net unrealized gains on our fixed maturity portfolio as of September 30, 2021 would be eliminated. Should interest rates increase further, we would not be concerned with potential interest rate driven unrealized losses in our fixed maturity portfolio because we do not intend to sell, nor is it likely that management will be required to sell, the fixed maturities prior to their anticipated recovery.

Required interest on net insurance policy liabilities reduces net investment income, as it is the amount of net investment income considered by management necessary to “fund” required interest on net insurance policy liabilities, which is the net of the benefit reserve liability and the deferred acquisition cost asset. As such, it is removed from the investment segment and applied to the insurance segments to offset the effect of the required interest from the insurance segments. As discussed in Note 10—Business Segments, management regards this as a more meaningful analysis of the investment and insurance segments. Required interest is based on the actuarial interest assumptions used in discounting the benefit reserve liability and the amortization of deferred acquisition costs for our insurance policies in force.

The great majority of our life and health insurance policies are fixed interest rate protection policies, not investment products, and are accounted for under current GAAP accounting guidance for long-duration insurance products which mandate that interest rate assumptions for a particular block of business be “locked in” for the life of that block of business. Each calendar year, we set the discount rate to be used to calculate the benefit reserve liability and the amortization of the deferred acquisition cost asset for all insurance policies issued that year. That rate is based on the new money yields that we expect to earn on cash flow received in the future from policies of that issue year, and cannot be changed. The discount rate used for policies issued in the current year has no impact on the in force policies issued in prior years as the rates of all prior issue years are also locked in. As such, the overall discount rate for the entire in force block of 5.7% is a weighted average of the discount rates being used from all issue years. Changes in the overall weighted-average discount rate over time are caused by changes in the mix of the reserves and the deferred acquisition cost asset by issue year on the entire block of in force business. Business issued in the current year has very little impact on the overall weighted-average discount rate due to the size of our in force business.

Since actuarial discount rates are locked in for life on essentially all of our business, benefit reserves and deferred acquisition costs are not affected by interest rate fluctuations unless a loss recognition event occurs. Due to the strength of our underwriting margins, we do not expect an extended low interest rate environment will cause a loss recognition event.

In comparison to the year-ago period, required interest on net insurance policy liabilities increased $26 million, or 6%, to $470 million, compared with the 5% growth in average net interest-bearing insurance policy liabilities.

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Globe Life Inc.

Management's Discussion & Analysis

Financing costs for the investment segment consist primarily of interest on our various debt instruments. The table below presents the components of financing costs and reconciles interest expense per the Condensed Consolidated Statements of Operations.

Analysis of Financing Costs

(Dollar amounts in thousands)

	Nine Months Ended<br>September 30,				Increase<br>(Decrease)
	2021		2020		Amount		%
Interest on funded debt	$	59,556	$	53,444	$	6,112	11
Interest on term loans	—		4,193		(4,193)		(100)
Interest on short-term debt	4,257		7,633		(3,376)		(44)
Other	20		25		(5)		(20)
Financing costs	$	63,833	$	65,295	$	(1,462)	(2)

During the first nine months of 2021, financing costs decreased 2% compared with the prior year primarily due to lower rates on the short-term debt. The interest on funded debt was higher than prior year as a result of the 2.15% Senior Note issued in August 2020. The debt proceeds were used, in part, to redeem all the outstanding term loans. As discussed in Note 9—Debt, on June 14, 2021, Globe Life Inc. issued $325 million of 4.25% Junior Subordinated Debentures due 2061. The net proceeds from the sale of the Junior Subordinated Debentures were used to redeem the $300 million 6.125% Junior Subordinated Debentures due 2056 on July 15, 2021. The net increase in interest on funded debt was more than offset by lower interest rates on the short-term debt. More information on our debt transactions is disclosed in the Financial Condition section of this report.

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Globe Life Inc.

Management's Discussion & Analysis

Realized Gains and Losses. Our core business of providing insurance coverage requires us to maintain a large and diverse investment portfolio to support our insurance liabilities. From time to time, investments are sold or called, or experience a credit loss event, each of which results in a realized gain or loss. The Company also elects to measure its investment in certain limited partnerships at fair value in accordance with the fair value option for financial instruments with changes recognized in "Realized gains (losses)" in the Condensed Consolidated Statements of Operations.

Realized gains and losses can be significant in relation to the earnings from core insurance operations, and as a result, can have a material positive or negative impact on net income. The significant fluctuations caused by gains and losses can cause period-to-period trends of net income that are not indicative of historical core operating results or predictive of the future trends of core operations. Accordingly, they have no bearing on core insurance operations or segment results as we view operations. For these reasons, and in line with industry practice, we remove the effects of realized gains and losses when evaluating overall insurance operating results. The following table summarizes our tax-effected realized gains (losses) by component.

Analysis of Realized Gains (Losses), Net of Tax

(Dollar amounts in thousands, except for per share data)

	Nine Months Ended September 30,
	2021				2020
	Amount		Per Share		Amount		Per Share
Fixed maturities:
Sales	$	(8,424)	$	(0.08)	$	(28,844)	$	(0.27)
Matured or other redemptions(1)	34,161		0.33		7,702		0.07
Provision for credit losses	2,643		0.02		(3,466)		(0.03)
Fair value option—change in fair value	11,070		0.11		(5,370)		(0.05)
Other	5,264		0.05		8,042		0.08
Total realized gains (losses)—investments	44,714		0.43		(21,936)		(0.20)
Loss on redemption of debt	(7,358)		(0.07)		(501)		(0.01)
Total realized gains (losses)	$	37,356	$	0.36	$	(22,437)	$	(0.21)

(1)During the nine months ended September 30, 2021 and 2020, the Company recorded $108.3 million and $152.1 million of exchanges of fixed maturity securities (noncash transactions) that resulted in $19.9 million and $6.2 million, respectively in realized gains, net of tax.

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Globe Life Inc.

Management's Discussion & Analysis

Investment Acquisitions. Globe Life's investment policy calls for investing primarily in investment grade fixed maturities that meet our quality and yield objectives. We generally prefer to invest in securities with longer maturities because they more closely match the long-term nature of our policy liabilities. We believe this strategy is appropriate since our expected future cash flows are generally stable and predictable and the likelihood that we will need to sell invested assets to raise cash is low. If longer-term securities that meet our quality and yield objectives are not available, we do not compromise on our quality objectives; instead, we consider investing in shorter-term or lower-yielding securities taking into consideration the slope of the yield curve and other factors such as risk adjusted capital adjusted returns.

The following table summarizes selected information for fixed maturity investments. The effective annual yield shown is based on the acquisition price and call features, if any, of the securities. For non-callable bonds, the yield is calculated to maturity date. For callable bonds acquired at a premium, the yield is calculated to the earliest known call date and call price after acquisition ("first call date"). For all other callable bonds, the yield is calculated to maturity date.

Fixed Maturity Acquisitions Selected Information

(Dollar amounts in thousands)

	Nine Months Ended<br>September 30,
	2021			2020
Cost of acquisitions:
Investment-grade corporate securities	$	490,169		$	532,529
Investment-grade municipal securities	239,754			345,011
Other investment-grade securities	10,465			27,831
Total fixed maturity acquisitions(1)	$	740,388		$	905,371
Effective annual yield (one year compounded)(2)	3.36		%	3.81		%
Average life (in years, to next call)	25.0			16.5
Average life (in years, to maturity)	32.0			26.2
Average rating	A+			A

(1)Fixed maturity acquisitions included unsettled trades of $52 million in 2021 and $0 in 2020.

(2)Tax-equivalent basis, where the yield on tax-exempt securities is adjusted to produce a yield equivalent to the pretax yield on taxable securities.

For investments in callable bonds, the actual life of the investment will depend on whether the issuer calls the investment prior to the maturity date. Given our investments in callable bonds, the actual average life of our investments cannot be known at the time of the investment. Absent sales and "make-whole calls", however, the average life will not be less than the average life to next call and will not exceed the average life to maturity. Data for both of these average life measures is provided in the above chart.

Acquisitions in both periods consisted primarily of corporate and municipal bonds with securities spanning a diversified range of issuers, industry sectors, and geographical regions. In the first nine months of 2021, we invested primarily in the industrial, municipal, and financial sectors. For the entire portfolio, the taxable equivalent effective yield earned was 5.23%, down approximately 12 basis points from the yield in the first nine months of 2020. As previously noted in the discussion of net investment income, the decrease was primarily due to the combination of lower interest rates applicable to new purchases and fixed maturity dispositions. For the remainder of 2021, the Company will continue to execute on its existing strategy by seeking to invest in assets that satisfy our quality and other objectives, while maximizing the highest risk adjusted capital adjusted return.

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Globe Life Inc.

Management's Discussion & Analysis

In 2017, it was announced by the head of the United Kingdom's Financial Conduct Authority of its plan to phase out the floating rate, London Interbank Offered Rate (LIBOR). The rate will transition out from 2021 to mid-year 2023. As of September 30, 2021, the Company had limited assets and liabilities that utilize LIBOR as a benchmark rate. We will continue to monitor the progress toward the establishment of a new floating rate.

Since fixed maturities represent such a significant portion of our investment portfolio, the remainder of the discussion of portfolio composition will focus on fixed maturities. See a breakdown of the Company's Other long-term investments in Note 4—Investments.

Selected information concerning the fixed maturity portfolio is as follows:

Fixed Maturity Portfolio Selected Information

	At
	September 30,<br>2021	December 31, 2020	September 30,<br>2020
Average annual effective yield(1)	5.20%	5.28%	5.32%
Average life, in years, to:
Next call(2)	15.9	16.2	16.4
Maturity(2)	19.0	19.0	19.1
Effective duration to:
Next call(2,3)	10.8	11.0	10.9
Maturity(2,3)	12.1	12.3	12.1

(1)Tax-equivalent basis. The yield on tax-exempt securities is adjusted to produce a yield equivalent to the pretax yield on taxable securities.

(2)Globe Life calculates the average life and duration of the fixed maturity portfolio two ways:

(a) based on the next call date which is the next call date for callable bonds and the maturity date for noncallable bonds, and

(b) based on the maturity date of all bonds, whether callable or not.

(3)Effective duration is a measure of the price sensitivity of a fixed-income security to a 1% change in interest rates.

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Globe Life Inc.

Management's Discussion & Analysis

Credit Risk Sensitivity. The following tables summarize certain information about the major corporate sectors and security types held in our fixed maturity portfolio at September 30, 2021 and December 31, 2020.

Fixed Maturities by Sector

September 30, 2021

(Dollar amounts in thousands)

	Below Investment Grade								Total Fixed Maturities								% of Total Fixed Maturities
	Amortized<br>Cost, net		Gross<br>Unrealized<br>Gains		Gross<br>Unrealized<br>Losses		Fair<br>Value		Amortized<br>Cost, net		Gross<br>Unrealized<br>Gains		Gross<br>Unrealized<br>Losses		Fair<br>Value		At Amortized Cost, net	At Fair Value
Corporates:
Financial
Insurance - life, health, P&C	$	57,518	$	3,488	$	(5,970)	$	55,036	$	2,334,750	$	522,364	$	(7,373)	$	2,849,741	13	13
Banks	26,988		648		—		27,636		969,030		213,106		(1,903)		1,180,233		6	6
Other financial	98,180		674		(696)		98,158		1,259,954		191,951		(3,198)		1,448,707		7	7
Total financial	182,686		4,810		(6,666)		180,830		4,563,734		927,421		(12,474)		5,478,681		26	26
Utilities
Electric	49,351		5,950		—		55,301		1,392,055		397,858		(255)		1,789,658		8	9
Gas and water	—		—		—		—		543,434		111,424		(733)		654,125		3	3
Total utilities	49,351		5,950		—		55,301		1,935,489		509,282		(988)		2,443,783		11	12
Industrial - Energy
Pipelines	85,249		7,924		(1,220)		91,953		919,696		212,509		(1,226)		1,130,979		5	5
Exploration and production	100,681		20,831		—		121,512		544,565		113,079		(905)		656,739		3	3
Oil field services	—		—		—		—		49,783		13,905		—		63,688		—	—
Refiner	—		—		—		—		89,119		25,406		—		114,525		1	1
Driller	—		—		—		—		—		—		—		—		—	—
Total energy	185,930		28,755		(1,220)		213,465		1,603,163		364,899		(2,131)		1,965,931		9	9
Industrial - Basic materials
Chemicals	—		—		—		—		673,914		141,633		(203)		815,344		4	4
Metals and mining	—		—		—		—		406,085		123,781		—		529,866		2	3
Forestry products and paper	—		—		—		—		65,642		16,556		—		82,198		—	—
Total basic materials	—		—		—		—		1,145,641		281,970		(203)		1,427,408		6	7
Industrial - Consumer, non-cyclical	84,191		12,900		(2,379)		94,712		2,248,326		469,398		(3,115)		2,714,609		13	13
Other industrials	25,589		3,676		—		29,265		1,264,882		289,300		(449)		1,553,733		7	7
Industrial - Transportation	25,545		5,618		—		31,163		570,212		138,770		(38)		708,944		3	3
Other corporate sectors	179,453		24,038		(3,428)		200,063		1,638,857		282,931		(11,534)		1,910,254		10	9
Total corporates	732,745		85,747		(13,693)		804,799		14,970,304		3,263,971		(30,932)		18,203,343		85	86
Other fixed maturities:
Government (U.S., municipal, and foreign)	—		—		—		—		2,509,932		287,357		(12,955)		2,784,334		14	13
Collateralized debt obligations	36,088		27,073		—		63,161		36,088		27,073		—		63,161		—	—
Other asset-backed securities	13,618		—		(736)		12,882		105,430		5,030		(736)		109,724		1	1
Mortgage-backed securities(1)	—		—		—		—		274		30		—		304		—	—
Total fixed maturities	$	782,451	$	112,820	$	(14,429)	$	880,842	$	17,622,028	$	3,583,461	$	(44,623)	$	21,160,866	100	100

(1)Includes Government National Mortgage Association (GNMA).

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Globe Life Inc.

Management's Discussion & Analysis

Fixed Maturities by Sector

December 31, 2020

(Dollar amounts in thousands)

	Below Investment Grade								Total Fixed Maturities								% of Total Fixed Maturities
	Amortized<br>Cost		Gross<br>Unrealized<br>Gains		Gross<br>Unrealized<br>Losses		Fair<br>Value		Amortized<br>Cost		Gross<br>Unrealized<br>Gains		Gross<br>Unrealized<br>Losses		Fair<br>Value		At Amortized Cost	At Fair Value
Corporates:
Financial
Insurance - life, health, P&C	$	57,658	$	3,894	$	(10,788)	$	50,764	$	2,275,843	$	563,349	$	(14,769)	$	2,824,423	13	13
Banks	27,014		15		(456)		26,573		993,946		259,489		(1,050)		1,252,385		6	6
Other financial	114,919		271		(8,245)		106,945		1,134,414		193,975		(8,402)		1,319,987		7	6
Total financial	199,591		4,180		(19,489)		184,282		4,404,203		1,016,813		(24,221)		5,396,795		26	25
Utilities
Electric	50,663		6,289		—		56,952		1,438,796		476,744		(108)		1,915,432		9	9
Gas and water	—		—		—		—		536,664		131,851		—		668,515		3	3
Total utilities	50,663		6,289		—		56,952		1,975,460		608,595		(108)		2,583,947		12	12
Industrial - Energy
Pipelines	85,327		1,624		(2,309)		84,642		923,756		187,851		(2,423)		1,109,184		5	5
Exploration and production	104,719		5,980		(678)		110,021		555,796		121,940		(678)		677,058		3	3
Oil field services	—		—		—		—		49,799		13,613		—		63,412		—	—
Refiner	—		—		—		—		89,371		22,793		—		112,164		1	1
Driller	1,902		—		18		1,920		1,902		—		18		1,920		—	—
Total energy	191,948		7,604		(2,969)		196,583		1,620,624		346,197		(3,083)		1,963,738		9	9
Industrial - Basic materials
Chemicals	—		—		—		—		642,258		152,016		—		794,274		4	4
Metals and mining	—		—		—		—		406,564		144,110		—		550,674		2	3
Forestry products and paper	—		—		—		—		88,804		21,588		—		110,392		1	1
Total basic materials	—		—		—		—		1,137,626		317,714		—		1,455,340		7	8
Industrial - Consumer, non-cyclical	96,265		8,680		(1,903)		103,042		2,233,324		576,007		(2,070)		2,807,261		13	13
Other industrials	25,661		3,925		—		29,586		1,260,646		328,986		(6)		1,589,626		7	7
Industrial - Transportation	25,777		4,315		—		30,092		566,935		175,405		—		742,340		3	3
Other corporate sectors	179,878		17,459		(3,595)		193,742		1,489,113		329,254		(4,142)		1,814,225		9	9
Total corporates	769,783		52,452		(27,956)		794,279		14,687,931		3,698,971		(33,630)		18,353,272		86	86
Other fixed maturities:
Government (U.S., municipal, and foreign)	—		—		—		—		2,313,855		341,176		(1,256)		2,653,775		13	13
Collateralized debt obligations	57,007		23,460		(8,869)		71,598		57,007		23,460		(8,869)		71,598		—	—
Other asset-backed securities	13,949		—		(2,727)		11,222		134,616		3,591		(3,778)		134,429		1	1
Mortgage-backed securities(1)	—		—		—		—		390		45		—		435		—	—
Total fixed maturities	$	840,739	$	75,912	$	(39,552)	$	877,099	$	17,193,799	$	4,067,243	$	(47,533)	$	21,213,509	100	100

(1)Includes GNMAs.

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Globe Life Inc.

Management's Discussion & Analysis

Corporate securities, which consist of bonds and redeemable preferred stocks, were the largest component of the September 30, 2021 fixed maturity portfolio, representing 85% of amortized cost, net and 86% of fair value. The remainder of the portfolio is invested primarily in securities issued by the U.S. government and U.S. municipalities. The Company holds insignificant amounts in foreign government bonds, collateralized debt obligations, asset-backed securities, and mortgage-backed securities. Corporate securities are diversified over a variety of industry sectors and issuers. At September 30, 2021, the total fixed maturity portfolio consisted of 813 issuers.

Fixed maturities had a fair value of $21.2 billion at September 30, 2021 and at December 31, 2020. The net unrealized gain position in the fixed-maturity portfolio decreased from $4.0 billion at December 31, 2020 to $3.5 billion at September 30, 2021 due to an increase in market rates during the period.

For more information about our fixed maturity portfolio by component at September 30, 2021 and December 31, 2020, including a discussion of allowance for credit losses, an analysis of unrealized investment losses and a schedule of maturities, see Note 4—Investments.

An analysis of the fixed maturity portfolio by a composite quality rating at September 30, 2021 and December 31, 2020 is shown in the following tables. The composite rating for each security, other than private-placement securities managed by third parties, is the average of the security’s ratings as assigned by Moody’s Investor Service, Standard & Poor’s, Fitch Ratings, and Dominion Bond Rating Service, LTD. The ratings assigned by these four nationally recognized statistical rating organizations are evenly weighted when calculating the average. The composite quality rating is created utilizing a methodology developed by Globe Life using ratings from the various rating agencies noted above. The composite quality rating is not a Standard & Poor's credit rating. Standard & Poor's does not sponsor, endorse or promote the composite quality rating and shall not be liable for any use of the composite quality rating. Included in the following chart are private placement fixed maturity holdings of $546 million at amortized cost, net of allowance for credit losses ($590 million at fair value) for which the ratings were assigned by the third-party managers.

Fixed Maturities by Rating

At September 30, 2021

(Dollar amounts in thousands)

	Amortized Cost, net		% of Total	Fair<br>Value		% of Total	Average Composite Quality Rating on Amortized Cost, net
Investment grade:
AAA	$	739,932	4	$	843,516	4
AA	2,058,961		12	2,234,915		11
A	4,535,387		26	5,653,568		27
BBB+	3,801,497		22	4,662,298		22
BBB	4,119,117		23	4,981,192		23
BBB-	1,584,683		9	1,904,535		9
Total investment grade	16,839,577		96	20,280,024		96	A-
Below investment grade:
BB	617,790		3	681,244		3
B	128,573		1	136,438		1
Below B	36,088		—	63,160		—
Total below investment grade	782,451		4	880,842		4	BB-
	$	17,622,028	100	$	21,160,866	100
Weighted average composite quality rating							A-

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Globe Life Inc.

Management's Discussion & Analysis

Fixed Maturities by Rating

At December 31, 2020

(Dollar amounts in thousands)

	Amortized<br><br>Cost		% of Total	Fair<br><br>Value		% of Total	Average Composite Quality Rating on Amortized Cost
Investment grade:
AAA	$	713,053	4	$	848,621	4
AA	1,657,270		10	1,873,323		9
A	4,566,999		26	5,969,677		28
BBB+	3,634,583		21	4,612,898		22
BBB	4,137,099		24	5,088,114		24
BBB-	1,644,056		10	1,943,777		9
Total investment grade	16,353,060		95	20,336,410		96	A-
Below investment grade:
BB	686,184		4	692,609		3
B	115,646		1	122,104		1
Below B	38,909		—	62,386		—
Total below investment grade	840,739		5	877,099		4	BB-
	$	17,193,799	100	$	21,213,509	100
Weighted average composite quality rating							A-

The overall quality rating of the portfolio is A-, the same as year-end 2020. Fixed maturities rated BBB are 54% of the total portfolio at September 30, 2021 compared with 55% at year-end 2020. While this ratio is high relative to our peers, we have limited exposure to higher-risk assets such as derivatives, equities, and asset-backed securities. Additionally, the Company does not participate in securities lending and has no off-balance sheet investments as of September 30, 2021. BBB securities generally provide the Company with the best risk adjusted capital adjusted returns, largely due to our unique ability to hold securities to maturity regardless of fluctuations in interest rates or equity markets.

An analysis of changes in our portfolio of below-investment grade fixed maturities at amortized cost, net of allowance for credit losses is as follows:

Below-Investment Grade Fixed Maturities

(Dollar amounts in thousands)

	Nine Months Ended<br>September 30,
	2021		2020
Balance at beginning of period	$	840,739	$	674,155
Downgrades by rating agencies	—		225,819
Upgrades by rating agencies	—		(10,551)
Dispositions	(64,030)		(47,943)
Provision for credit losses	3,346		(4,387)
Amortization and other	2,396		2,408
Balance at end of period	$	782,451	$	839,501

Our investment policy calls for investing primarily in fixed maturities that are investment grade and meet our quality and yield objectives. Thus, any increases in below-investment grade issues are typically a result of ratings downgrades of existing holdings. Below-investment grade bonds at amortized cost, net of allowance for credit

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Globe Life Inc.

Management's Discussion & Analysis

losses, were 13% of our shareholders’ equity, excluding the effect of unrealized gains and losses on fixed maturities as of September 30, 2021. Globe Life invests long term and as such, one of our key criterion in our investment process is to select issuers that have the ability to weather multiple financial cycles. As part of this process, we consider economic, social, and governance (ESG) and other long term sustainability factors.

OPERATING EXPENSES

Operating expenses are included in the "Corporate and Other" segment and are classified into two categories: insurance administrative expenses and expenses of the Parent Company. Insurance administrative expenses generally include expenses incurred after a policy has been issued. As these expenses relate to premium for a given period, management measures the expenses as a percentage of premium income. The Company also views stock-based compensation expense as a Parent Company expense. Expenses associated with the issuance of our insurance policies are reflected as acquisition expenses and included in the determination of underwriting margin.

An analysis of operating expenses is shown below.

Operating Expenses Selected Information

(Dollar amounts in thousands)

	Nine Months Ended September 30,						Increase
	2021			2020			(Decrease)
	Amount		% of<br>Premium	Amount		% of<br>Premium	Amount		%
Insurance administrative expenses:
Salaries	$	85,616	2.8	$	79,010	2.8	$	6,606	8
Other employee costs	32,970		1.1	30,307		1.0	2,663		9
Information technology costs	35,561		1.2	33,785		1.2	1,776		5
Legal costs	10,743		0.3	8,540		0.3	2,203		26
Other administrative costs	36,825		1.2	36,552		1.3	273		1
Total insurance administrative expenses	201,715		6.6	188,194		6.6	13,521		7
Parent company expense	7,251			7,536			(285)
Stock compensation expense	24,298			26,655			(2,357)
Legal proceedings	5,089			3,275			1,814
Non-operating expenses	2,397			1,033			1,364
Total operating expenses, per Condensed Consolidated Statements of Operations	$	240,750		$	226,693		$	14,057	6

Total operating expenses increased 6% over the prior year period primarily due to a 7% increase in insurance administrative expenses. Insurance administrative expenses increased primarily due to higher employee-related expenses, including pension costs and information technology salaries. Pension expense increased due to the lower discount rate used to determine net periodic benefit costs in 2021 as compared to 2020. The decrease in stock-based compensation expense was primarily due to fewer performance based equity awards applicable to the first nine months of 2021 as compared to the same period in 2020. While insurance administrative expenses were up 7% from prior year, as a percentage of premium at 6.6%, it was flat compared with 2020.

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Globe Life Inc.

Management's Discussion & Analysis

SHARE REPURCHASES

Globe Life has an ongoing share repurchase program that began in 1986, and is reviewed quarterly by management and annually reaffirmed by the Board of Directors. With no specified authorization amount, we determine the amount of repurchases based on the amount of the excess cash flow at the Parent Company, general market conditions, and other alternative uses. The majority of these purchases are made from excess cash flow. Excess cash flow at the Parent Company is primarily comprised of dividends received from the insurance subsidiaries less interest expense paid on its debt, dividends paid to Parent Company shareholders, and other limited operating activities. Additionally, when stock options are exercised, proceeds from these exercises and the resulting tax benefit are used to repurchase additional shares on the open market to minimize dilution as a result of the option exercises. In August, the Board of Directors reauthorized the Parent Company’s share repurchase program in amounts and with timing that management, in consultation with the Board, determines to be in the best interest of the Company and its shareholders.

The following chart summarizes share repurchases for the nine month periods ended September 30, 2021 and 2020.

Analysis of Share Repurchases

(Amounts in thousands, except per share data)

	Nine Months Ended September 30,
	2021					2020
	Shares	Amount		Average<br>Price		Shares	Amount		Average<br>Price
Purchases with:
Excess cash flow at the Parent Company	3,191	$	310,047	$	97.17	3,069	$	257,049	$	83.74
Option exercise proceeds	824	83,333		101.05		413	39,599		95.99
Total	4,015	$	393,380	$	97.97	3,482	$	296,648	$	85.19

Throughout the remainder of this discussion, share repurchases will only refer to those made from excess cash flow at the Parent Company.

FINANCIAL CONDITION

Liquidity. Liquidity provides Globe Life with the ability to meet on demand the cash commitments required to support our business operations and meet our financial obligations. Our liquidity is primarily derived from three sources: positive cash flow from operations, a portfolio of marketable securities, and a revolving credit facility.

Insurance Subsidiary Liquidity. The operations of our insurance subsidiaries have historically generated substantial cash inflows in excess of immediate cash needs. Cash inflows for the insurance subsidiaries primarily include premium and investment income. In addition to investment income, maturities and scheduled repayments in the investment portfolio are cash inflows. Cash outflows from operations include policy benefit payments, commissions, administrative expenses, and taxes. A portion of the excess cash inflows in the current year will provide for the payment of future policy benefits, and are invested primarily in long-term fixed maturities as they better match the long-term nature of these obligations. Excess cash available from the insurance subsidiaries’ operations is generally distributed as a dividend to the Parent Company, subject to regulatory restrictions. The dividends are generally paid in amounts equal to the subsidiaries’ prior year statutory net income excluding realized capital gains. While the leading source of the excess cash is investment income, a significant portion of the excess cash also comes from underwriting income due to our high underwriting margins and effective expense control. While the insurance subsidiaries routinely generate more operating cash inflows than cash outflows annually, the companies also have the entire available-for-sale fixed maturity investment portfolio available to create additional cash flows if required.

In July, three of our insurance subsidiaries became members of the Federal Loan Home Bank of Dallas (FHLB). FHLB membership provides the insurance subsidiaries with access to various low cost collateralized borrowings

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Globe Life Inc.

Management's Discussion & Analysis

and funding agreements. While not a primary source of liquidity, the FHLB could provide the insurance subsidiaries with an additional source of liquidity, if needed. Refer to Note 9—Debt for further details.

Parent Company Liquidity. An important source of Parent Company liquidity is the dividends from its insurance subsidiaries. These dividends are received throughout the year and are used by the Parent Company to pay dividends on common and preferred stock, interest and principal repayment requirements on Parent Company debt, and operating expenses of the Parent Company.

	Nine Months Ended<br>September 30,				Twelve Months Ended December 31,
	2021		2020		Projected 2021		2020
Liquidity Sources:
Dividends from Subsidiaries	$	422,622	$	440,997	$	480,000	$	485,871
Excess Cash Flows	334,471		359,701		360,000		387,606

Additional sources of liquidity for the Parent Company are cash, intercompany receivables, intercompany borrowings, public debt markets, term loans, and a credit facility. At September 30, 2021, the Parent Company had access to $280 million of invested cash, net intercompany receivables and other liquid assets, down from the prior quarter as a result of the redemption of the $300 million 6.125% Junior subordinated debentures due 2056 on July 15, 2021. The Parent Company is expected to generate approximately $25 million excess cash flows in the remainder of the year.

Short-Term Borrowings. An additional source of Parent Company liquidity is a credit facility with a group of lenders allowing for unsecured revolving borrowings and stand-by letters of credit up to $750 million, which could be extended up to $1 billion. The Parent Company may request the extension, however it is not guaranteed. Up to $250 million in letters of credit can be issued against the facility. The facility serves as a back-up credit line for a commercial paper program under which commercial paper may be issued at any time, with total commercial paper outstanding not to exceed the facility maximum, less any letters of credit issued. Interest charged on the commercial paper program resembles variable rate debt due to its short term nature. On September 30, 2021, Globe Life amended the credit agreement dated August 24, 2020. The five-year credit agreement will now mature on September 30, 2026. As of September 30, 2021, the Parent Company was in full compliance with all covenants related to the aforementioned debt.

The following table presents certain information about our commercial paper borrowings.

Credit Facility—Commercial Paper

(Dollar amounts in thousands)

	At
	September 30,<br>2021			December 31, 2020			September 30,<br>2020
Balance of commercial paper at end of period (par value)	$	244,000		$	255,000		$	280,000
Annualized interest rate	0.20		%	0.27		%	0.67		%
Letters of credit outstanding	$	135,000		$	135,000		$	150,000
Remaining amount available under credit line	371,000			360,000			320,000

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Globe Life Inc.

Management's Discussion & Analysis

Credit Facility—Commercial Paper Activity

(Dollar amounts in thousands)

	Nine Months Ended September 30,
	2021			2020
Average balance of commercial paper outstanding during period (par value)	$	306,126		$	332,802
Daily-weighted average interest rate (annualized)	0.23		%	1.78		%
Maximum daily amount outstanding during period (par value)	$	425,000		$	482,000

The Company reduced the commercial paper borrowings by $11 million since year-end, reflecting timing of cash needs of the Parent Company. We had no difficulties in accessing the commercial paper market under this facility during the nine months ended September 30, 2021 and 2020.

Globe Life expects to have readily available funds for 2021 and the foreseeable future to conduct its operations and to maintain target capital ratios in the insurance subsidiaries through liquid assets currently available, internally-generated cash flow and the credit facility. In the unlikely event that more liquidity is needed, the Parent Company could generate additional funds through multiple sources including, but not limited to, the issuance of debt, an additional short-term credit facility or term loan, and intercompany borrowing.

Consolidated Liquidity. Consolidated net cash inflows from operations were $1.06 billion in the first nine months of 2021, compared with $1.08 billion in the same period of 2020. The decrease is primarily attributable to fluctuations in the settlement of certain amounts included in other liabilities. In addition to cash inflows from operations, our insurance companies received proceeds from dispositions of fixed maturities available for sale in the amount of $250 million during the 2021 period. As previously noted under the caption Credit Facility, the Parent Company has in place a credit facility. The insurance companies have no additional outstanding credit facilities.

Cash and short-term investments were $190 million at September 30, 2021, compared with $203 million at December 31, 2020. In addition to these liquid assets, the entire $21.2 billion (fair value at September 30, 2021) portfolio of fixed income securities is available for sale in the event of an unexpected need. Approximately 97% of our fixed income securities are publicly traded, freely tradable under SEC Rule 144, or qualified for resale under SEC Rule 144A. We generally expect to hold fixed income securities to maturity, and even though these securities are classified as available for sale, we have the ability and intent to hold any securities to recovery. Our strong cash flows from operations, on-going investment maturities, and available liquidity under our credit facility make any need to sell securities for liquidity highly unlikely.

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Globe Life Inc.

Management's Discussion & Analysis

Capital Resources. The Parent Company's capital structure consists of short-term debt (the commercial paper facility and current maturities of long-term debt), long-term debt, and shareholders’ equity.

Long-Term Borrowings. The outstanding long-term debt at book value was $1.5 billion at September 30, 2021 and $1.7 billion at December 31, 2020. Refer to Note 9—Debt for a complete analysis and description of long-term debt issues outstanding.

Selected Information about Debt Issues

As of September 30, 2021

(Dollar amounts in thousands)

Instrument	Issue Date	Maturity Date	Coupon Rate	Interest Payment Dates	Par<br>Value		Book<br>Value		Fair<br>Value
Senior notes	05/27/1993	05/15/2023	7.875%	semiannual	$	165,612	$	165,149	$	184,414
Senior notes(1)	09/24/2012	09/15/2022	3.800%	semiannual	150,000		149,666		154,767
Senior notes	09/27/2018	09/15/2028	4.550%	semiannual	550,000		544,794		637,719
Senior notes	08/21/2020	08/15/2030	2.150%	semiannual	400,000		395,672		396,944
Junior subordinated debentures	11/17/2017	11/17/2057	5.275%	semiannual	125,000		123,392		130,349
Junior subordinated debentures	06/14/2021	06/15/2061	4.250%	quarterly	325,000		317,187		331,110
					1,715,612		1,695,860		1,835,303
Less current maturity of long-term debt(1)					150,000		149,666		154,767
Total long-term debt					1,565,612		1,546,194		1,680,536
Current maturity of long-term debt(1)					150,000		149,666		154,767
Commercial paper					244,000		243,927		243,927
Total short-term debt					394,000		393,593		398,694
Total debt					$	1,959,612	$	1,939,787	$	2,079,230

(1)An additional $150 million par value and book value is held by insurance subsidiaries that eliminates in consolidation.

Subsidiary Capital: The National Association of Insurance Commissioners (NAIC) has established a risk-based factor approach for determining threshold risk-based capital levels for all insurance companies. This approach was designed to assist the regulatory bodies in identifying companies that may require regulatory attention. A Risk-Based Capital (RBC) ratio is typically determined by dividing adjusted total statutory capital by the amount of risk-based capital determined using the NAIC’s factors. If a company’s RBC ratio approaches two times the RBC amount, the company must file a plan with the NAIC for improving their capital levels (this level is commonly referred to as “Company Action Level” RBC). Companies typically hold a multiple of the Company Action Level RBC depending on their particular business needs and risk profile.

Our goal is to maintain statutory capital within our insurance subsidiaries at levels necessary to support our current ratings. For 2021, Globe Life has targeted a consolidated Company Action Level RBC ratio of 300% to 320%. The Company concludes that this capital level is more than adequate and sufficient to support its current ratings, given the nature of its business and its risk profile. As of December 31, 2020, our consolidated Company Action Level RBC ratio was 309%. In August 2021, the NAIC fully adopted new and expanded C-1 investment factors. The adoption of these factors will result in higher amounts of required capital related to our investment portfolio. In addition to the expanded C-1 factors, additional capital will be needed by the end of the year to support higher sales levels, growth of our in-force business, higher COVID-19 net life claims, and the acquisition of Beazley Benefits. As such, we anticipate contributing assets of approximately $150 million to our insurance subsidiaries in the fourth quarter. The Parent Company is committed to maintaining the targeted consolidated RBC ratio at its insurance subsidiaries and has sufficient liquidity available to provide additional capital if necessary.

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GLOBE LIFE INC.

Management's Discussion & Analysis

Shareholders' Equity: On August 23, 2021, the Parent Company announced that it had declared a quarterly dividend of $0.1975 per share. This dividend was paid on November 1, 2021.

Shareholders’ equity was $8.6 billion at September 30, 2021. This compares with $8.8 billion at December 31, 2020 and $8.2 billion at September 30, 2020. During the nine months since December 31, 2020, shareholders’ equity decreased primarily due to $379 million of after-tax unrealized losses in the fixed-maturity portfolio as interest rates have increased over the period. In addition, shareholders' equity increased by net income of $567 million during the first nine months of 2021, but was offset by share repurchases of $310 million and an additional $83 million in share purchases to counterbalance the dilution from stock option exercises.

We plan to use excess cash available at the Parent Company as efficiently as possible in the future. Possible uses of excess cash flow include, but are not limited to, share repurchases, acquisitions, increases in shareholder dividends, investment in securities, or repayment of short-term debt. We will determine the best use of excess cash after ensuring that targeted capital levels are maintained in our insurance subsidiaries. If market conditions are favorable, we currently expect that share repurchases will continue to be a primary use of those funds.

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GLOBE LIFE INC.

Management's Discussion & Analysis

Globe Life is required under GAAP to revalue its available for sale fixed maturity portfolio to fair market value at the end of each accounting period. These changes, net of their associated impact on deferred acquisition costs and income tax, are reflected directly in shareholders’ equity.

While GAAP requires our fixed maturity assets to be revalued, it does not permit interest-bearing insurance policy liabilities supported by those assets to be valued at fair value in a consistent manner, with changes in value applied directly to shareholders’ equity. However, due to the size of both the investment portfolio and our policy liabilities, this inconsistency in measurement can have a material impact on shareholders’ equity. Because of the long-term nature of our fixed maturities and liabilities and the strong cash flows generated by our insurance subsidiaries, we have the intent and ability to hold our securities to maturity. As such, we do not expect to incur realized gains or losses due to fluctuations in the market value of fixed maturities caused by interest rate changes or losses caused by temporarily illiquid markets. Accordingly, management removes the effect of this rule when analyzing the Company's balance sheet, capital structure, and financial ratios in order to provide a consistent and meaningful portrayal of the Company’s financial position from period to period.

The following table presents selected data related to our capital resources. Additionally, the table presents the effect of this accounting guidance on relevant line items, so that investors and other financial statement users may determine its impact on Globe Life's capital structure. Excluding the effect of unrealized gains and losses on the fixed maturity portfolio from shareholders' equity is considered non-GAAP. Below we include the reconciliation to GAAP.

Selected Financial Data

(Dollar amounts in thousands, except per share data)

	At
	September 30, 2021						December 31, 2020						September 30, 2020
	GAAP			Effect of<br><br>Accounting<br><br>Rule<br><br>Requiring<br><br>Revaluation(1)			GAAP			Effect of<br><br>Accounting<br><br>Rule<br><br>Requiring<br><br>Revaluation(1)			GAAP			Effect of<br><br>Accounting<br><br>Rule<br><br>Requiring<br><br>Revaluation(1)
Fixed maturities	$	21,160,866		$	3,538,838		$	21,213,509		$	4,019,710		$	20,277,056		$	3,389,389
Deferred acquisition costs(2)	4,837,409			(4,756)			4,595,444			(5,955)			4,517,255			(6,338)
Total assets	29,496,578			3,534,082			29,046,731			4,013,755			28,041,893			3,383,051
Short-term debt	393,593			—			254,918			—			279,758			—
Long-term debt	1,546,194			—			1,667,886			—			1,667,506			—
Shareholders' equity	8,608,151			2,791,925			8,771,092			3,170,866			8,224,908			2,672,610
Book value per diluted share	84.52			27.41			83.19			30.07			77.60			25.21
Debt to capitalization(3)	18.4		%	(6.6)		%	18.0		%	(7.6)		%	19.1		%	(6.8)		%
Diluted shares outstanding	101,848						105,429						105,986
Actual shares outstanding	101,140						103,797						105,058

(1)Amount added to (deducted from) comprehensive income to produce the stated GAAP item, per accounting rule ASC 320-10-35-1.

(2)Includes the value of business acquired (VOBA).

(3)This ratio is computed by dividing total debt by the sum of total debt and shareholders’ equity.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

There have been no quantitative or qualitative changes with respect to market risk exposure during the nine months ended September 30, 2021.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures: Globe Life, under the direction of the Co-Chairmen and Chief Executive Officers and the Executive Vice President and Chief Financial Officer, has established disclosure controls and procedures that are designed to ensure that information required to be disclosed by Globe Life in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. The disclosure controls and procedures are also intended to ensure that such information is accumulated and communicated to Globe Life's management, including the Co-Chairmen and Chief Executive Officers and the Executive Vice President and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures.

As of the end of the fiscal period completed September 30, 2021, an evaluation was performed under the supervision and with the participation of Globe Life management, including the Co-Chairmen and Chief Executive Officers and the Executive Vice President and Chief Financial Officer, of the disclosure controls and procedures (as those terms are defined in Rule 13a-15(e) under the Securities Exchange Act of 1934). Based upon their evaluation, the Co-Chairmen and Chief Executive Officers and the Executive Vice President and Chief Financial Officer have concluded that disclosure controls and procedures are effective as of the date of this Form 10-Q. In compliance with Section 302 of the Sarbanes Oxley Act of 2002 (18 U.S.C. § 1350), each of these officers executed a Certification included as an exhibit to this Form 10-Q.

Changes in Internal Control over Financial Reporting: As of the period ended September 30, 2021, there have not been any changes in Globe Life Inc.'s internal control over financial reporting or in other factors that could significantly affect this control over financial reporting subsequent to the date of their evaluation which have materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

Part II—Other Information

Item 1. Legal Proceedings

Discussion regarding litigation and unclaimed property audits is provided in Note 5—Commitments and Contingencies.

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Item 1A. Risk Factors

The Company had no material changes to its risk factors.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Certain Equity Securities by the Issuer and Others for the Third Quarter of 2021

Period	(a) Total Number<br><br>of Shares<br><br>Purchased	(b) Average<br><br>Price Paid<br><br>Per Share		(c) Total Number of<br>Shares Purchased as <br>Part of Publicly Announced<br>Plans or Programs
July 1-31, 2021	498,282	$	93.81	498,282
August 1-31, 2021	400,178	94.95		400,178
September 1-30, 2021	140,318	93.03		140,318

On August 4, 2021, the Globe Life Board of Directors reaffirmed its continued authorization of the Company's stock repurchase program in amounts and with timing that management, in consultation with the Board, determined to be in the best interest of the Company. The program has no defined expiration date or maximum shares to be repurchased.

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Item 6. Exhibits

Exhibit No.	Description
10.1	Amended Globe Life Inc. 2018 Non-Employee Director Compensation Plan*
10.2	Payments to Directors*
31.1	Rule 13a-14(a)/15d-14(a) Certification by Gary L. Coleman
31.2	Rule 13a-14(a)/15d-14(a) Certification by Larry M. Hutchison
31.3	Rule 13a-14(a)/15d-14(a) Certification by Frank M. Svoboda
32.1	Section 1350 Certification by Gary L. Coleman, Larry M. Hutchison, and Frank M. Svoboda
101.INS	XBRL Instance Document- the instance document does not appear in the Interactive Data file because the XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document.
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.
104	Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101).

*Compensatory plan or arrangement.

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SIGNATURES

Pursuant to the requirement 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.

	GLOBE LIFE INC.
Date: November 3, 2021	/s/ Gary L. Coleman
	Gary L. Coleman
	Co-Chairman and Chief Executive Officer
Date: November 3, 2021	/s/ Larry M. Hutchison
	Larry M. Hutchison
	Co-Chairman and Chief Executive Officer
Date: November 3, 2021	/s/ Frank M. Svoboda
	Frank M. Svoboda
	Executive Vice President and Chief Financial Officer

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amendedglobelifeinc2018n

AMENDED GLOBE LIFE INC. 2018 NON-EMPLOYEE DIRECTOR COMPENSATION PLAN SECTION 1. GENERAL PURPOSE OF PLAN; DEFINITIONS The name of this plan is the Globe Life Inc. 2018 Non-Employee Director Compensation Plan (the “Plan”). The purpose of the Plan is to enable Globe Life Inc. (the “Company”) and its Subsidiaries and Affiliates to attract and retain directors who contribute to the Company’s success by their ability, ingenuity and industry, and to enable such directors to participate in the long-term success and growth of the Company through an equity interest in the Company. The Plan was adopted effective as of April 26, 2018, and replaced and superseded the Company’s existing 2011 Non-Employee Director Compensation Plan. The Plan was adopted as a sub-plan of the Globe Life Inc. 2018 Incentive Plan (the “2018 Incentive Plan”). Effective January 1, 2020, the Board of Directors of the Company approved the amendment of this Plan to change the name of the Plan to the Globe Life Inc. 2018 Non-Employee Director Compensation Plan and all references therein from Torchmark Corporation to Globe Life Inc. Effective August 4, 2021, the Board of Directors of the Company approved revisions to the manner in which Non-Employee Directors are compensated as reflected in this amendment and restatement. Capitalized terms used in the Plan but not otherwise defined shall have the meanings given such terms in the 2018 Incentive Plan. In addition, the following terms shall be defined for purposes of the Plan as set forth below: “Annual Compensation” means the total annual retainer, expressed as a dollar amount, payable by the Company to a Non- Employee Director for services as a director (excluding, if applicable any retainers or fees payable for services as the member or chairman of a committee of the Board, which shall be payable separate and apart from the provisions of this Plan) of the Company. For the period of January 1, 2020 through December 31, 2021, the annual retainer shall be $260,000. Commencing January 1, 2022, the annual retainer shall be $270,000 and shall be paid at the time and in the form detailed in Section 5 below. The amount of the annual retainer may be changed from time to time. “Award Notice” means a written award notice to a Non-Employee Director from the Company evidencing an award of Stock Options, Restricted Stock or Restricted Stock Units. “Beneficiary” means any person or persons designated by a Participant, in accordance with procedures established by the Committee or Plan Administrator, to receive benefits hereunder in the event of the Participant’s death. If any Participant shall fail to designate a Beneficiary or shall designate a Beneficiary who shall fail to survive the Participant, the Beneficiary shall be the Participant’s surviving spouse, or, if none, the Participant’s surviving descendants (who shall take per stirpes) and if there are no surviving descendants, the Beneficiary shall be the Participant’s estate. “Business Day” shall mean a day on which the New York Stock Exchange or any national securities exchange or over-the-counter market on which the Stock is traded is open for business. “Committee” means the Compensation Committee of the Board. If at any time no Committee shall be in office, then the functions of the Committee specified in the Plan shall be exercised by the Board. “Election Date” means the date by which a Non-Employee Director must submit a valid Election Form to the Plan Administrator. For each calendar year, the Election Date is December 31 of the preceding calendar year; provided, however, that the Election Date for a newly eligible Participant shall be the 30th day following the date on which such individual becomes a Non- Employee Director. “Election Form” means an Election Form for Annual Compensation, substantially in the form attached hereto as Exhibit A, pursuant to which a Non-Employee Director elects to receive all or a portion of his or her Annual Compensation in the form of cash, Stock Options, Restricted Stock or Restricted Stock Units, or to defer Annual Compensation under the Plan. “Grantee” means a Non-Employee Director to whom a Stock Option, Restricted Stock, or Restricted Stock Unit has been granted.

“Interest Account” means the account established by the Company for each Non-Employee Director for Annual Compensation deferred pursuant to the Plan and which shall be credited with interest on the last day of each calendar quarter (or such other day as determined by Plan Administrator) pursuant to Section 6(f) of the Plan. “Plan” means this 2018 Non-Employee Director Compensation Plan. “Plan Administrator” means one or more agents to whom the Board shall have delegated administrative duties under the Plan or the Committee if no such delegation shall have occurred. “Restricted Stock” means shares of Stock granted to a Participant under Section 5 or 6 that are subject to certain restrictions and to risk of forfeiture. “Restricted Stock Unit” means a right granted to a Participant under Section 6 to receive shares of Stock in the future, which right is subject to certain restrictions and to risk of forfeiture. “Stock Option” means any option granted to a Participant to purchase shares of Stock granted pursuant to Section 6. SECTION 2. ADMINISTRATION. The Plan shall be administered by the Committee. The Committee shall have the discretionary authority to adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan as it shall, from time to time, deem advisable; to construe and interpret the terms and provisions of the Plan and any award issued under the Plan (and any agreements relating thereto); and to otherwise supervise the administration of the Plan. The Committee may delegate administrative duties under the Plan to one or more agents as it shall deem necessary or advisable. No member of the Committee or the Board or the Plan Administrator shall be personally liable for any action or determination made in good faith with respect to the Plan or any Options, Restricted Stock or Restricted Stock Units, or to any settlement of any dispute between a Non-Employee Director and the Company. All decisions made by the Board or the Committee pursuant to the provisions of the Plan shall be final and binding on all persons, including the Company and Participants. SECTION 3. SOURCE OF SHARES FOR THE PLAN. The shares of Stock that may be issued pursuant to the Plan shall be issued under the 2018 Incentive Plan, subject to all of the terms and conditions of the 2018 Incentive Plan. The terms contained in the 2018 Incentive Plan are incorporated into and made a part of this Plan with respect to Stock Options, Restricted Stock or Restricted Stock Units granted pursuant hereto, and any such Stock Options, Restricted Stock or Restricted Stock Units shall be governed by and construed in accordance with the 2018 Incentive Plan. In the event of any actual or alleged conflict between the provisions of the 2018 Incentive Plan and the provisions of this Plan, the provisions of the 2018 Incentive Plan shall be controlling and determinative. This Plan does not constitute a separate source of shares for the grant of the equity awards described herein. SECTION 4. ELIGIBILITY. All Non-Employee Directors are eligible to participate in the Plan. SECTION 5. ELECTION TO RECEIVE ANNUAL COMPENSATION IN CASH, STOCK OPTIONS, RESTRICTED STOCK, RESTRICTED STOCK UNITS OR TO DEFER ANNUAL COMPENSATION. (a) Election Regarding Annual Compensation. With respect to $100,000 of his or her Annual Compensation, a Non- Employee Director may receive cash, payable in quarterly installments, or may elect (i) to receive Stock Options, Restricted Stock or Restricted Stock Units pursuant to subsections (c), (d) or (e) below, or (ii) to defer receipt of this portion of his or her Annual Compensation pursuant to subsection (f) below for a calendar year, in either case by delivering a properly completed and signed Election Form to the Plan Administrator on or before the Election Date. With respect to the remaining amount of Annual Compensation, a Non-Employee Director must elect to receive Stock Options, Restricted Stock or Restricted Stock Units pursuant to subsections (c), (d) or (e) below, by delivering a properly completed and signed Election Form to the Plan Administrator on or before the Election Date. Such election will be effective as of the first day of the calendar year beginning after the Plan Administrator receives the Non-Employee Director’s Election Form, or, in the case of a newly eligible Participant, on the Business Day the Plan Administrator receives such Non-Employee Director’s Election Form, provided that the Election Form is received within thirty (30) days following the Non-Employee Director’s date of initial

eligibility to participate in the Plan. If a Non-Employee Director fails to make a timely election under this Section 5(a), he or she will receive $100,000 of his or her Annual Compensation in the form of cash, payable in quarterly installments, and the remaining amount of Annual Compensation in the form of Stock Options. (b) Irrevocable Election. A Participant may not revoke or change his or her Election Form. (c) Election to Receive Stock Options. Effective January 1, 2020, a Non-Employee Director may elect to receive $160,000 or $260,000 of his or her Annual Compensation in Stock Options in accordance with the provisions of this subsection (c). Effective January 1, 2022, a Non-Employee Director may elect to receive $170,000 or $270,000 of his or her Annual Compensation in Stock Options in accordance with the provisions of this subsection (c). Stock Options granted under this subsection (c) shall be evidenced by an Award Notice in such form as the Committee shall from time to time approve, which agreements shall comply with and be subject to the following terms and conditions: (i) Time of Issuance of Stock Options. If an election is made under this subsection, Stock Options will be issued to the Non-Employee Director on the first Business Day in the calendar year to which the election relates or in the case of a newly elected Participant, the first Business Day the election is received by the Plan Administrator (the “Option Grant Date”). (ii) Number of Stock Options. The number of shares subject to a Stock Option granted pursuant to this Article 5(c) shall be the number of whole Shares equal to A divided by B, where: A = the dollar amount which the Non-Employee Director has elected to receive in Stock Options; and B =the per share value of a Stock Option on the Option Grant Date, as determined by the Committee using any recognized option valuation model selected by the Board in its discretion (such value to be expressed as a percentage of the Fair Market Value per Share on the Option Grant Date). In determining the number of shares subject to a Stock Option, (A) the Board may designate the assumptions to be used in the selected option valuation model, and (B) any fraction of a Share will be rounded up to the next whole number of Shares. (iii) Exercise Price of Stock Options. The exercise price per share of each Stock Option shall be 100% of the Fair Market Value of the underlying Stock on the date of the grant of the Stock Option. (iv) Vesting and Forfeiture of Stock Options. Except as provided in Section 8, Stock Options shall vest (become exercisable) on the six-month anniversary of the Option Grant Date, provided that the Grantee is still serving as a Non-Employee Director at such time. Notwithstanding the foregoing vesting schedule, Stock Option shall become fully vested and exercisable upon Grantee’s termination of service as a Non-Employee Director due to death, Disability or Retirement. Upon a Grantee’s termination of status as a Non-Employee Director with the Company for any reason other than due to death, Disability or Retirement, any unvested Stock Options held by such Grantee shall be forfeited. (v) Method of Exercise. Any Stock Option granted pursuant to the Plan may be exercised in whole or in part at any time during the option period, by giving written notice of exercise to the Company specifying the number of shares to be purchased, accompanied by payment in full of the purchase price, in cash, by check or such other instrument as may be acceptable to the Committee (including “net” or “cashless exercise” arrangements). Payment in full or in part may also be made in the form of unrestricted Stock already owned by the Grantee (based on the Fair Market Value of the Stock on the date the Option is exercised). No shares of Stock shall be issued upon exercise of a Stock Option until the exercise price has been fully paid or satisfied. (vi) Transferability of Stock Options. Stock Options shall not be transferable by the Grantee otherwise than by will or by the laws of descent and distribution, and all Stock Options shall be exercisable, during the Grantee’s lifetime, only by the Grantee; provided, however, that the Committee may (but need not) permit other transfers where the Committee concludes that such transferability

(i) does not result in accelerated taxation, and (ii) is otherwise appropriate and desirable, taking into account any state or federal securities laws applicable to transferable options. (vii) Term of Stock Options. The term of any Stock Option granted pursuant to the Plan shall be for a period of seven years, expiring on the seventh anniversary of the Option Grant Date (the “Expiration Date”). Following Grantee’s termination of status as a Non-Employee Director for any reason, vested Stock Options held by such Grantee shall be retained and may thereafter be exercised during the period ending on the Expiration Date. (d) Election to Receive Restricted Stock. Effective January 1, 2020, a Non-Employee Director may elect to receive $160,000 or $260,000 of his or her Annual Compensation in Restricted Stock in accordance with the provisions of this subsection (d). Effective January 1, 2022, a Non-Employee Director may elect to receive $170,000 or $270,000 of his or her Annual Compensation in Restricted Stock in accordance with the provisions of this subsection (d). Restricted Stock granted under this subsection (d) shall be evidenced by an Award Notice in such form as the Committee shall from time to time approve, which agreements shall comply with and be subject to the following terms and conditions: (i) Time of Issuance of Restricted Stock. If an election is made under this subsection, Restricted Stock will be issued to the Non-Employee Director on the first Business Day in the calendar year to which the election relates or in the case of a newly elected Participant, the first Business Day the election is received by the Plan Administrator (which shall be the “Restricted Stock Grant Date” for purposes of Restricted Stock granted under this Section 5). (ii) Number of Shares of Restricted Stock. The number of shares of Restricted Stock granted pursuant to this Article 5(d) shall be the number of whole Shares equal to A divided by B, where: A= the dollar amount which the Non-Employee Director has elected to receive in shares of Restricted Stock; and B =the Fair Market Value per Share on the Restricted Stock Grant Date. In determining the number of shares of Restricted Stock, any fraction of a Share will be rounded up to the next whole number of Shares. (iii) Terms and Conditions of Restricted Stock. Restricted Stock shall comply with and be subject to the following terms and conditions: (1) Vesting. Except as provided in Section 9, Restricted Stock granted under this Section 5 shall become fully vested on the six-month anniversary of the Restricted Stock Grant Date, provided that the Grantee is still serving as a Non-Employee Director at such time. Notwithstanding the foregoing vesting schedule, Restricted Stock shall become fully vested upon Grantee’s termination of service as a Non-Employee Director due to death, Disability or Retirement. (2) Restrictions on Unvested Restricted Stock. Unvested Restricted Stock may not be sold, transferred, exchanged, assigned, pledged, hypothecated or otherwise encumbered. If a Non-Employee Director’s service as a director of the Company terminates for any reason other than death, Disability or Retirement, then the Non-Employee Director shall forfeit all of his or her right, title and interest in and to any unvested Restricted Stock as of the date of such termination from the Board, and such Restricted Stock shall be re-conveyed to the Company without further consideration or any act or action by the Non-Employee Director. (3) Rights as a Shareholder. A Non-Employee Director shall have full voting and dividend rights with respect to the Restricted Stock. If a Non-Employee Director forfeits any shares of Restricted Stock, he or she shall no longer have any rights as a stockholder with respect to the Restricted Stock or any interest therein and the Participant shall no longer be entitled to receive dividends on such stock. (e) Election to Receive Restricted Stock Units. Effective January 1, 2020, a Non-Employee Director may elect to receive $160,000 or $260,000 of his or her Annual Compensation in Restricted Stock Units in accordance with the provisions of this subsection (e). Effective January 1, 2022, a Non-Employee Director may elect to receive $170,000 or $270,000 of his or her Annual Compensation in Restricted

Stock Units in accordance with the provisions of this subsection (e). Restricted Stock Units granted under this subsection (e) shall be evidenced by an Award Notice in such form as the Committee shall from time to time approve, which agreements shall comply with and be subject to the following terms and conditions: (i) Time of Issuance of Restricted Stock Units. If an election is made under this subsection, Restricted Stock Units will be issued to the Non-Employee Director on the first Business Day in the calendar year to which the election relates or in the case of a newly elected Participant, the first Business Day the election is received by the Plan Administrator (the “Restricted Stock Unit Grant Date”). (ii) Number of Restricted Stock Units. The number of Restricted Stock Units granted pursuant to this Article 6(d) shall be the number of whole Shares equal to A divided by B, where: A= the dollar amount which the Non-Employee Director has elected to receive in Restricted Stock Units; and B = the Fair Market Value per Share on the Restricted Stock Unit Grant Date. In determining the number of Restricted Stock Units, any fraction of a Share will be rounded up to the next whole number of Shares. (iii) Terms and Conditions of Restricted Stock Units. Restricted Stock Units will be credited to a bookkeeping account on behalf of the Non-Employee Director and shall comply with and be subject to the following terms and conditions: (1) Vesting and Forfeiture. Except as provided in Section 8, Restricted Stock Units shall vest and become non-forfeitable on the six-month anniversary of the Restricted Stock Unit Grant Date, provided that the Grantee is still serving as a Non-Employee Director at such time. Notwithstanding the foregoing vesting schedule, Restricted Stock Units shall become fully vested upon Grantee’s termination of service as a Non-Employee Director due to death, Disability or Retirement. If a Non-Employee Director’s service as a director of the Company terminates for any reason other than death, Disability or Retirement, then the Non-Employee Director shall forfeit all of his or her right, title and interest in and to any unvested Restricted Stock Units as of the date of such termination from the Board, and such Restricted Stock Units shall be reconveyed to the Company without further consideration or any act or action by the Non-Employee Director. (2) Conversion to Common Stock. Unless forfeited prior to vesting, Restricted Stock Units shall be converted to actual shares of Stock on the Non-Employee Director’s termination of service as a director of the Company for any reason. Upon conversion, stock certificates evidencing the conversion of Restricted Stock Units into shares of Stock shall be registered on the books of the Company in the Non-Employee Director’s name (or in street name to the Non-Employee Director’s brokerage account) in uncertificated (book-entry) form unless the Non- Employee Director requests a stock certificate or certificates for the Shares. (3) Dividend Equivalents. If any dividends or other distributions are paid with respect to the Shares while Restricted Stock Units are outstanding, the dollar amount or fair market value of such dividends or distributions with respect to the number of Shares then underlying the outstanding Restricted Stock Units shall be converted into additional Restricted Stock Units in Non-Employee Director’s name, based on the Fair Market Value of the Stock as of the date such dividends or distributions were payable, and such additional Restricted Stock Units shall be immediately vested and non-forfeitable upon grant, and shall convert to actual shares of Stock on the Non-Employee Director’s termination of service as a director of the Company for any reason. (4) Restrictions on Transfer. Restricted Stock Units are not assignable or transferable other than by will or the laws of descent and distribution. Restricted Stock Units may not be pledged, hypothecated or otherwise encumbered to or in favor of any party other than the Company or an affiliate, or be subjected to any lien, obligation or liability of a Non- Employee Director to any other party other than the Company or an affiliate.

(5) Rights as a Shareholder. A Non-Employee Director shall not have voting or any other rights as a shareholder of the Company with respect to the Restricted Stock Units. Upon conversion of the Restricted Stock Units into shares of Stock, the Non-Employee Director will obtain full voting and other rights as a shareholder of the Company. (f) Election to Defer Annual Compensation. A Non-Employee Director may elect to defer $100,000 of his or her Annual Compensation to his or her Interest Account. For bookkeeping purposes, the amount of the Annual Compensation, which the Participant elects to defer pursuant to the Plan, shall be transferred to and held in individual Interest Accounts (in annual designations) pending distribution in cash pursuant to subsection (iii) below. (i) Interest Accounts. Amounts in a Participant’s Interest Account will be credited with interest as of the last day of each calendar quarter (or such other day as determined by the Plan Administrator) at the rate set from time to time by the Committee to be applicable to the Interest Accounts of all Participants under the Plan. To the extent required for bookkeeping purposes, a Participant’s Interest Accounts will be segregated to reflect Deferred Compensation on a year-by-year basis. Within a reasonable time after the end of each calendar year, the Plan Administrator shall report in writing to each Participant the amount held in his or her Interest Accounts at the end of the year. (ii) Payment Commencement Date. Payment of the balances in a Participant’s Interest Accounts shall commence on the earliest to occur of (a) December 31 of the fifth year after the year with respect to which the deferral was made, (b) the first Business Day of the fourth month after the Participant’s death, or (c) the Participant’s termination as a Non-Employee Director of the Company or any of its Subsidiaries or Affiliates, other than by reason of death. (iii) Optional Forms of Payment. Distributions from a Participant’s Interest Accounts may be paid to the Participant either in a lump sum or in a number (not to exceed ten) of approximately equal annual installments designated by the Participant on his or her Election Form. In the event of the Participant’s death during the payout period, the remaining balance shall be payable to the Participant’s Beneficiary in a lump sum on or about the first Business Day of the fourth month after the Participant’s death. If a Participant elects to receive a distribution of his or her Interest Accounts in installments, the Plan Administrator may purchase an annuity from an insurance company which annuity will pay the Participant the desired annual installments. If the Plan Administrator purchases an annuity contract, the Participant will have no further rights to receive payments from the Company or the Plan with respect to the amounts subject to the annuity. If the Plan Administrator does not purchase an annuity contract, the value of the Interest Accounts remaining unpaid shall continue to receive allocations of return as provided in subsection (f) above. If the Participant fails to designate a payment method in the Participant’s Election Form, the Participant’s Account shall be distributed in a lump sum. (iv) Irrevocable Elections. A Participant may elect a different payment form for each year’s Annual Compensation deferred under the Plan. The payment form elected or deemed elected on the Participant’s election form shall be irrevocable. (v) Acceleration of Payment. If a Participant elects an installment distribution and the aggregate value of the Participant’s Interest Accounts at the time the installments are due to commence is less than $16,500, the Plan Administrator will accelerate payment of the Participant’s benefits in a single lump sum. (vi) Effect of Adverse Determination. Notwithstanding the Election Form or any provision set forth herein, if the Internal Revenue Service determines that all or any portion of the amounts credited under this Plan is currently includable in the taxable income of any Participant due to a failure of the Plan to meet the requirements of Code Section 409A or the regulations thereunder, then the amounts so determined to be includable in income shall be distributed in a lump sum to such Participant as soon as practicable. (g) Unforeseeable Emergency. The Plan Administrator may, in its sole discretion, accelerate the making of payment to a Participant in the event that a participant incurs a financial hardship as a result of an “unforeseeable emergency” (as such term is defined below). All unforeseeable emergency distributions shall be made in cash in a lump sum. Such payments will be made on a first-in, first-out basis so that the

oldest Annual Compensation deferred under the Plan shall be deemed distributed first. For purposes hereof, an “unforeseeable emergency” means a severe financial hardship to the Participant resulting from illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Section 152 of the Code without regard to Section l52(b)(I), (b)(2), and (d)( I )(B)) of the Participant, loss of the Participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The amounts distributable because of an unforeseeable emergency cannot exceed the amounts necessary to satisfy such emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such emergency is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship). Notwithstanding any provision in the Plan to the contrary, any payment made pursuant to this Section 6(g) shall comply with Section 409A(a)(2)(A)(vi) of the Code and the regulations (or similar guidance) promulgated thereunder (or any successor provisions). (h) Payment to Minors and Incapacitated Persons. In the event that any amount is payable to a minor or to any person who, in the judgment of the Plan Administrator, is incapable of making proper disposition thereof, such payment shall be made for the benefit of such minor or such person in any of the following ways as the Plan Administrator, in its sole discretion, shall determine: (i) By payment to the legal representative of such minor or such person; (ii) By payment directly to such minor or such person; (iii) By payment in discharge of bills incurred by or for the benefit of such minor or such person. The Plan Administrator shall make such payments without the necessary intervention of any guardian or like fiduciary, and without any obligation to require bond or to see to the further application of such payment. Any payment so made shall be in complete discharge of the Plan’s obligation to the Participant and his or her Beneficiaries. (i) Application for Benefits. The Plan Administrator may require a Participant or Beneficiary to complete and file certain forms as a condition precedent to receiving the payment of benefits. The Plan Administrator may rely upon all such information given to it, including the Participant’s current mailing address. It is the responsibility of all persons interested in receiving a distribution pursuant to the Plan to keep the Plan Administrator informed of their current mailing addresses. (j) Designation of Beneficiary. Each Participant from time to time may designate any person or persons (who may be designated contingently or successively and who may be an entity other than a natural person) as his or her Beneficiary or Beneficiaries to whom the Participant’s Interest Accounts are to be paid if the Participant dies before receipt of all such benefits. Each Beneficiary designation shall be on the form prescribed by the Plan Administrator and will be effective only when filed with the Plan Administrator during the Participant’s lifetime. Each Beneficiary designation filed with the Plan Administrator will cancel all Beneficiary designations previously filed with the Plan Administrator. The revocation of a Beneficiary designation, no matter how effected, shall not require the consent of any designated Beneficiary. SECTION 6. AMENDMENTS AND TERMINATION. The Board may amend, alter, or discontinue the Plan, but no amendment, alteration, or discontinuation shall be made which would impair the right of a Participant or a Grantee of an award of Stock Options, Restricted Stock or Restricted Stock Units heretofore granted, without the Participant’s or Grantee’s consent. Amendments may be made without stockholder approval except as required to satisfy stock exchange listing requirements or other regulatory requirements. The Board may amend the terms of any Stock Option, Restricted Stock or Restricted Stock Unit award theretofore granted, prospectively or retroactively; provided, however, (a) no such amendment shall impair the rights of any holder without his/her consent; (b) the original term of a Stock Option may not be extended without prior approval of the stockholders of the Company; and (c) the exercise price of a Stock Option may not be reduced, directly or indirectly, without prior approval of the stockholders of the Company.

SECTION 7. UNFUNDED STATUS OF PLAN. The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payments not yet made to a Participant or Grantee by the Company, nothing set forth herein shall give any such Participant or Grantee any rights that are greater than those of a general creditor of the Company. In its sole discretion, the Committee may authorize the creation of trusts or other arrangements to meet the obligations created under the Plan to deliver Stock or payments in lieu of or with respect to awards hereunder, provided, however, that the existence of such trusts or other arrangements is consistent with the unfunded status of the Plan. SECTION 8. CHANGE IN CONTROL. In the event of a “Change in Control,” unless otherwise determined by the Board in writing at or after grant, but prior to the occurrence of such Change in Control, any Stock Options awarded under the Plan not previously exercisable and vested shall become fully exercisable and vested, and any Restricted Stock or Restricted Stock Units awarded under the Plan not previously vested shall become fully vested. SECTION 9. GENERAL PROVISIONS. (a) Nothing set forth in this Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to stockholder approval if such approval is required; and such arrangements may be either generally applicable or applicable only in the specified cases. The adoption of the Plan shall not confer upon any director of the Company, any Subsidiary or any Affiliate, any right to continued retention as a director with the Company, a Subsidiary or an Affiliate, as the case may be. (b) At the time of grant or exercise, the Committee may provide in connection with any grant or exercise made under this Plan that the shares of Stock received as a result of such grant or purchase shall be subject to a right of first refusal, pursuant to which the Participant shall be required to offer to the Company any shares that the participant wishes to sell, with the price being the then Fair Market Value of the Stock, subject to the provisions of Section 9 hereof and to such other terms and conditions as the Board may specify at the time of grant. (c) No member of the Board or the Committee, nor any officer or employee of the Company acting on behalf of the Board or the Committee, shall be personally liable for any action, determination, or interpretation taken or made in good faith with respect to the Plan, and all members of the Board or the Committee and each and any officer or employee of the Company acting on their behalf shall, to the extent permitted by law, be fully indemnified and protected by the Company in respect of any such action, determination or interpretation. (d) In the event that any provision of the Plan or any related Award Notice is held to be invalid, void or unenforceable, the same shall not affect, in any respect whatsoever, the validity of any other provision of the Plan or any related Award Notice. (e) The rights and obligations under the Plan and any related agreements shall inure to the benefit of, and shall be binding upon the Company, its successors and assigns, and the Non-Employee Directors and their beneficiaries. (f) Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of the Plan. (g) The Plan shall be construed, governed and enforced in accordance with the Law of Delaware, except as such laws are preempted by applicable federal law. SECTION 10. EFFECTIVE DATE OF PLAN. The initial effective date of the Plan was April 26, 2018. This amendment and restatement shall be effective as of August 4, 2021. SECTION 11. TERM OF PLAN. No Stock Options, Restricted Stock or Restricted Stock Units shall be granted pursuant to the Plan following the termination of the 2018 Incentive Plan, as applicable, but awards theretofore granted may extend beyond that date.

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PAYMENTS TO DIRECTORS Effective January 1, 2022, non-employee directors of the Company are compensated on the following basis: (1) Cash Compensation - (a) Directors are paid $100,000 of their annual retainer in cash in quarterly installments unless a timely election is made under the Globe Life Inc. 2018 Non-Employee Director Compensation Plan (the “Plan”) to receive an equivalent amount of market value stock options, restricted stock or RSUs or to defer the cash to an interest-bearing account under the terms of that sub-plan of the Globe Life Inc. 2018 Incentive Plan; (b) The Lead Director receives an additional $45,000 annual retainer in cash, payable in quarterly installments; (c) Annual Board committee chair retainers, payable in quarterly installments in cash, are $35,000 for the Audit Committee Chair, $25,000 for the Chair of the Compensation Committee, and $20,000 for the Chair of the Governance and Nominating Committee; and (d) All members of the Audit Committee (excluding the Audit Committee Chair) receive an additional annual Audit Committee Member Retainer of $12,500, payable in quarterly installments; and (2) Equity Compensation - Directors are paid $170,000 of their annual retainer in equity, either in the form of market value stock options, restricted stock or RSUs, based on the director's timely election, with the equity issued on the first NYSE trading day of January of each calendar year valued at the NYSE market closing price of Company common stock on that date. If no timely election is made, the non-employee director receives his or her annual equity compensation in the form of $170,000 of market value stock options awarded on the first NYSE trading day of each year. Directors do not receive meeting fees or fees for the execution of written consents in lieu of Board meetings or in lieu of Board committee meetings. They receive reimbursement for their travel and lodging expenses if they do not live in the area where a meeting is held. Non-employee directors may currently elect to defer all or a designated portion of their cash-based annual director compensation into an interest-bearing account pursuant to a timely election made under the Globe Life Inc. 2018 Non-Employee Director Compensation Plan. These accounts bear interest at non-preferential rates set from time to time by the Compensation Committee. The amounts in such accounts are paid to the director in a lump sum or equal monthly installments for up to 120 months as elected by the director with payments commencing on the earliest of (a) December 31 of the fifth year after the year for which the deferral was made, (b) the first business day of the fourth month after the director's death, or (c) the director's termination as a non-employee director of the Company or any of its subsidiaries for a reason other than death. Directors who are employees of the Company or its subsidiaries receive no compensation for Board service.

Document

Exhibit 31.1

CERTIFICATIONS

I, Gary L. Coleman, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Globe Life Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 3, 2021

/s/ Gary L. Coleman
Gary L. Coleman<br>Co-Chairman and Chief Executive Officer

Document

Exhibit 31.2

CERTIFICATIONS

I, Larry M. Hutchison, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Globe Life Inc.;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 3, 2021

/s/ Larry M. Hutchison
Larry M. Hutchison<br>Co-Chairman and Chief Executive Officer

Document

Exhibit 31.3

CERTIFICATIONS

I, Frank M. Svoboda, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Globe Life Inc.;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 3, 2021

/s/ Frank M. Svoboda
Frank M. Svoboda<br><br>Executive Vice President and Chief Financial Officer

Document

Exhibit 32.1

CERTIFICATION OF PERIODIC REPORT

We, Gary L. Coleman, Co-Chairman and Chief Executive Officer of Globe Life Inc., Larry M. Hutchison, Co-Chairman and Chief Executive Officer of Globe Life Inc. and Frank M. Svoboda, Executive Vice President and Chief Financial Officer of Globe Life Inc., certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that, to the best of our knowledge:

(1)the Quarterly Report on Form 10-Q of the Company for the quarterly period ended September 30, 2021 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: November 3, 2021

/s/ Gary L. Coleman
Gary L. Coleman<br>Co-Chairman and Chief Executive Officer
/s/ Larry M. Hutchison
Larry M. Hutchison<br><br>Co-Chairman and Chief Executive Officer
/s/ Frank M. Svoboda
Frank M. Svoboda<br><br>Executive Vice President and Chief Financial Officer