Equibles

8-K

Primerica, Inc. (PRI)

8-K 2021-02-09 For: 2021-02-09
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Added on April 04, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT (Date of earliest event reported):      February 9, 2021

Primerica, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Delaware 001-34680 27-1204330
(State or Other Jurisdiction of<br>Incorporation) (Commission File Number) (I.R.S. Employer<br>Identification Number)
1 Primerica Parkway<br><br><br>Duluth, Georgia 30099
(Address of Principal Executive Offices, and Zip Code)

(770) 381-1000

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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 PRI New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter ).

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. ☐

Item 2.02Results of Operations and Financial Condition.

On February 9, 2021, Primerica, Inc. (the “Company”) announced its results of operations for the quarter ended December 31, 2020. A copy of the press release is attached hereto as Exhibit 99.1.

The information provided pursuant to this Item 2.02, including Exhibit 99.1 in Item 9.01, is “furnished” and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of such section, and shall not be incorporated by reference in any filing made by the Company under the Exchange Act or the Securities Act of 1933, as amended (the “Securities Act”), except to the extent expressly set forth by specific reference in any such filings.

Use of Non-GAAP Financial Measures

In addition to reporting financial results in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company presents certain non-GAAP financial measures.  Specifically, the Company presents adjusted direct premiums, other ceded premiums, adjusted operating revenues, adjusted operating income before income taxes, adjusted net operating income, adjusted stockholders’ equity and diluted adjusted operating earnings per share.  Adjusted direct premiums and other ceded premiums are net of amounts ceded under coinsurance transactions that were executed concurrent with our initial public offering (the “IPO coinsurance transactions”) for all periods presented. We exclude amounts ceded under the IPO coinsurance transactions in measuring adjusted direct premiums and other ceded premiums to present meaningful comparisons of the actual premiums economically maintained by the Company. Amounts ceded under the IPO coinsurance transactions will continue to decline over time as policies terminate within this block of business. Adjusted operating revenues, adjusted operating income before income taxes, adjusted net operating income and diluted adjusted operating earnings per share exclude the impact of realized investment gains (losses) and fair value mark-to-market (“MTM”) investment adjustments, including credit impairments, for all periods presented. We exclude realized investment gains (losses), including credit impairments, and MTM investment adjustments in measuring these non-GAAP financial measures to eliminate period-over-period fluctuations that may obscure comparisons of operating results due to items such as the timing of recognizing gains (losses) and market pricing variations prior to an invested asset’s maturity or sale that are not directly associated with the Company’s insurance operations. Adjusted stockholders’ equity excludes the impact of net unrealized investment gains (losses) recorded in accumulated other comprehensive income (loss) for all periods presented. We exclude unrealized investment gains (losses) in measuring adjusted stockholders’ equity as unrealized gains (losses) from the Company’s available-for-sale securities are largely caused by market movements in interest rates and credit spreads that do not necessarily correlate with the cash flows we will ultimately realize when an available-for-sale security matures or is sold.

Our definitions of these non-GAAP financial measures may differ from the definitions of similar measures used by other companies.  Management uses these non-GAAP financial measures in making financial, operating and planning decisions and in evaluating the Company’s performance.  Furthermore, management believes that these non-GAAP financial measures may provide users with additional meaningful comparisons between current results and results of prior periods as they are expected to be reflective of our core ongoing business.  These measures have limitations, and investors should not consider them in isolation or as a substitute for analysis of the Company’s results as reported under GAAP.

Reconciliations of GAAP to non-GAAP financial measures are included as attachments to the press release which has been posted in the “Investor Relations” section of our website at http://investors.primerica.com.

Item 7.01Regulation FD Disclosure.

On February 9, 2021, the Company posted to the “Investor Relations” section of its website certain supplemental financial information relating to the quarter ended December 31, 2020.  A copy of the supplemental financial information is attached hereto as Exhibit 99.2.

The information provided pursuant to this Item 7.01, including Exhibit 99.2 in Item 9.01, is “furnished” and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of such section, and shall not be incorporated by reference in any filing made by the Company under the Exchange Act or the Securities Act, except to the extent expressly set forth by specific reference in any such filings.

Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
99.1 Press Release dated February 9, 2021 – Primerica Reports Fourth Quarter 2020 Results
99.2 Primerica, Inc. Supplemental Financial Information – Fourth Quarter 2020
104 Cover Page from this Current Report on Form 8-K, formatted in Inline XBRL

SIGNATURES

Pursuant to the requirements 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.

Date:  February 9, 2021 PRIMERICA, INC.
/s/ Alison S. Rand
Alison S. Rand
Executive Vice President and Chief Financial Officer

3

pri-ex991_6.htm

Exhibit 99.1

PRIMERICA REPORTS FOURTH QUARTER 2020 RESULTS

Term Life policies issued increase 22%; a record $109 billion of face amount issued for the full-year 2020

Investment and Savings Products sales increase 4% to $2.1 billion with ending client asset values reaching a record $82 billion

Life-licensed sales force ends the year at 134,907 aided by ongoing COVID-19 related state licensing measures

Net earnings per diluted share (EPS) of $2.52, up 13%; return on stockholders’ equity (ROE) of 22.5%

Diluted adjusted operating EPS of $2.45, up 10%; adjusted net operating income return on adjusted stockholders’ equity (ROAE) of 23.4%

Board of Directors approves share repurchase program totaling $300 million through June 2022

Board of Directors approves 18% increase in dividends to $0.47 per share, payable on March 15, 2021

Duluth, GA, February 9, 2021 – Primerica, Inc. (NYSE: PRI) today announced financial results for the quarter ended December 31, 2020. Total revenues of $598.3 million increased 12% compared to the fourth quarter of 2019.  Net income of $100.1 million increased 7%, while earnings per diluted share of $2.52 increased 13% compared to the same quarter last year.  ROE was 22.5% for the current quarter.

Adjusted operating revenues were $594.7 million, increasing 12% compared to the fourth quarter of 2019. Adjusted net operating income of $97.3 million increased 5%, while diluted adjusted operating earnings per share of $2.45 increased 10% compared to the same quarter last year.  ROAE was 23.4% during the fourth quarter of 2020.

During the fourth quarter, the COVID-19 pandemic continued to have a significant impact on the Company’s Term Life segment.  COVID-19 related death claims were approximately $14 million, net of reinsurance, their highest level since the onset of the pandemic.  COVID-19 impacted customer behavior, with strong sales and policy

persistency continuing in the quarter.  The Investment and Savings Products (ISP) segment benefited from favorable market performance during the fourth quarter driving ending client asset values to a record $82 billion.  ISP sales during the quarter continued to shift toward mutual funds and managed accounts and away from annuity products.

“The COVID-19 pandemic caused middle income consumers to clearly understand their need for protection today and investments for tomorrow. The adaptability of our sales force allowed us to meet those needs more than ever before,” said Glenn Williams, Chief Executive Officer. “I am very proud of how our Primerica team navigated the unique challenges of 2020 to continue to help clients achieve their financial goals.”

Results for the full year ended December 31, 2020 were also heavily impacted by the pandemic.  COVID-19 related death claims, net of reinsurance, were approximately $33 million, while issued life policies were up 23% year-over-year with a record $109 billion of face amount issued.  Policy persistency also reached record levels during the year.  ISP sales for 2020 were a record $7.8 billion, up 4% year-over-year, despite a brief period of disruption following the market correction in March.  Term Life and ISP income before taxes increased 16% and 6% year-over-year, respectively.  Total revenues of $2.2 billion increased 8% year-over-year, setting a new annual record for the Company.  Net income of $386.2 million and earnings per diluted share of $9.57 increased 5% and 11%, respectively, and also represent new records.

Fourth Quarter Distribution & Segment Results

Distribution Results
Q4 2020 Q4 2019 % Change
Life-Licensed Sales Force ^(1)^ 134,907 130,522 3 %
Recruits 80,599 60,466 33 %
New Life-Licensed Representatives 12,119 11,073 9 %
Life Insurance Policies Issued 87,307 71,469 22 %
Life Productivity^(2)^ 0.21 0.18 *
ISP Product Sales ($ billions) $ 2.07 $ 1.98 4 %
Average Client Asset Values ($ billions) $ 76.09 $ 68.24 12 %
Closed U.S. Mortgage Volume ($ million brokered) $ 203.8 $ 18.1 *
^(1)^ End of period
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^(2)^ Life productivity equals policies issued divided by the average number of life insurance licensed representatives per month
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*     Not calculated

Segment Results
Q4 2020 Q4 2019 % Change
( in thousands)
Adjusted Operating Revenues:
Term Life Insurance $ 318,992 16 %
Investment and Savings Products 182,698 6 %
Corporate and Other Distributed Products ^(1)^ 29,250 11 %
Total adjusted operating revenues ^(1)^ $ 530,940 12 %
Adjusted Operating Income (Loss) before<br><br><br>income taxes:
Term Life Insurance $ 81,995 9 %
Investment and Savings Products 52,991 7 %
Corporate and Other Distributed Products ^(1)^ ) (13,861 ) 31 %
Total adjusted operating income before<br><br><br>income taxes ^(1)^ $ 121,125 6 %

All values are in US Dollars.

^(1)^ See the Non-GAAP Financial Measures section and the Adjusted Operating Results reconciliation tables at the end of this release for additional information.

Life Insurance Licensed Sales Force

At the end of the year, the Company had 134,907 independent life-licensed representatives, which represents a 3% increase year-over-year.  Special COVID-19 licensing measures enacted by various states added 3,597 licenses that were issued on a temporary basis and 2,508 licenses with extended renewal dates.  The Company estimates that approximately 4,200 individuals included in the year-end number will either not pursue the steps necessary to obtain a permanent license or will not renew an expiring license.

Recruiting activity remained robust with 80,599 new recruits added in the fourth quarter of 2020, a 33% increase year-over-year.  The licensing process remains challenged; however, gradual improvements led to a total of 12,119 new licenses during the quarter, including 1,668 temporary licenses issued by the states under their special COVID-19 policies, and represented a 9% increase compared to the prior year’s fourth quarter.

Term Life Insurance

Demand for protection products continued to positively impact sales during the fourth quarter.  The Company issued 87,307 new life insurance policies during the period, a 22% increase compared to the fourth quarter of 2019.  Productivity for the quarter, defined as policies issued per life insurance licensed representative per month, was 0.21 compared to 0.18 in the prior year period.

Revenues of $369.0 million during the fourth quarter increased 16% compared to the fourth quarter of 2019, while pre-tax income of $89.4 million increased 9% year-over-year.  Higher sales, along with favorable persistency throughout the year, moved the growth rate in adjusted direct premiums up to 15% year-over-year and added $7 million to pre-tax income for the quarter.     Strong persistency also led to $23 million less DAC amortization and $13 million higher benefit reserve increases being recognized year-over-year.  COVID-19 related death claims, net of reinsurance, during the quarter were

estimated to be $14 million.  As typically done in the fourth quarter, actuarial assumptions were locked in for 2020 business, resulting in a $5.5 million increase in benefit reserves due to lower long-term interest rate assumptions.

Investment and Savings Products

During the fourth quarter, investment product sales were $2.1 billion, a 4% increase year-over-year.  Sales of mutual funds and managed accounts were both up 17%, while annuities declined 15% as the income benefits on these products become less attractive.  Net client inflows of $642 million during the quarter continued to compare very favorably to the prior year period due to a combination of strong sales and low client redemptions.  Average client asset values were $76.1 billion, an increase of 12% compared to the fourth quarter of 2019.

Revenues of $193.3 million during the fourth quarter increased 6% compared to the same quarter in 2019, while pre-tax income of $56.7 million increased 7%.  Despite a 5% increase in revenue generating sales, associated revenues were flat year-over-year as the mix of products sold continued to weigh more heavily toward mutual funds, which have a lower sales-based commission rate compared to annuities.  Asset-based revenues increased 11% year-over-year, in line with the increase in average client asset values.  Sales-based and asset-based commissions were largely correlated to associated revenues.  Results also reflected a $1 million reduction in Canadian segregated fund DAC amortization due to favorable market performance and lower redemptions.

Corporate and Other Distributed Products

During the fourth quarter of 2020, the segment recorded an operating loss before taxes of $18.1 million compared to $13.9 million in the fourth quarter of 2019.   Consolidated net investment income was largely unchanged year-over-year as growth in the size of the investment portfolio was largely offset by lower interest rates.  However, on a segment basis, net investment income allocated to the C&O segment was down $2.2 million as we continue to allocate a larger portion of net investment income to the Term Life segment in support of the growing block of business.  The newly launched the U.S. mortgage distribution business added $3.7 million of revenues and about $1.0 million of pre-tax income to the segment’s results. Benefits and claims were $2.1 million higher year-over-year, largely due to a reserve adjustment on a closed block of business to reflect the sustained low interest rate environment.

Taxes

The fourth quarter effective income tax rate was 24.0% compared to 23.4% in the fourth quarter of 2019.  The rate increase was largely driven by higher state income taxes and Canadian earnings partially offset by higher exposure reserve releases in the current year period.

Capital

During the fourth quarter of 2020, the Company repurchased 115,433 shares of common stock for $13.4 million, bringing the annual total to $231.4 million.  The Board of Directors authorized the repurchase of up to $300 million of the Company’s common stock through June 2022 and approved an 18% increase in stockholder dividends to $0.47 per share, payable on March 15, 2021, to stockholders of record on February 22, 2021.

Primerica has a strong balance sheet and continues to be well-capitalized to meet future needs.  Primerica Life Insurance Company’s statutory risk-based capital (RBC) ratio was estimated to be approximately 400% as of December 31, 2020.

Non-GAAP Financial Measures

In addition to reporting financial results in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company presents certain non-GAAP financial measures.  Specifically, the Company presents adjusted direct premiums, other ceded premiums, adjusted operating revenues, adjusted operating income before income taxes, adjusted net operating income, adjusted stockholders’ equity and diluted adjusted operating earnings per share.  Adjusted direct premiums and other ceded premiums are net of amounts ceded under coinsurance transactions that were executed concurrent with our initial public offering (the “IPO coinsurance transactions”) for all periods presented. We exclude amounts ceded under the IPO coinsurance transactions in measuring adjusted direct premiums and other ceded premiums to present meaningful comparisons of the actual premiums economically maintained by the Company. Amounts ceded under the IPO coinsurance transactions will continue to decline over time as policies terminate within this block of business. Adjusted operating revenues, adjusted operating income before income taxes, adjusted net operating income and diluted adjusted operating earnings per share exclude the impact of realized investment gains (losses) and fair value mark-to-market (“MTM”) investment adjustments, including credit impairments, for all periods presented. We exclude realized investment gains (losses), including credit impairments, and MTM investment adjustments in measuring these non-GAAP financial measures to eliminate period-over-period fluctuations that may obscure comparisons of operating results due to items such as the timing of recognizing gains (losses) and market pricing variations prior to an invested asset’s maturity or sale that are not directly associated with the Company’s insurance operations. Adjusted stockholders’ equity excludes the impact of net unrealized investment gains (losses) recorded in accumulated other comprehensive income (loss) for all periods presented. We exclude unrealized investment gains (losses) in measuring adjusted stockholders’ equity as unrealized gains (losses) from the Company’s available-for-sale securities are largely caused by market movements in interest rates and credit spreads that do not necessarily correlate with the cash flows we will ultimately realize when an available-for-sale security matures or is sold.

Our definitions of these non-GAAP financial measures may differ from the definitions of similar measures used by other companies.  Management uses these non-GAAP

financial measures in making financial, operating and planning decisions and in evaluating the Company’s performance.  Furthermore, management believes that these non-GAAP financial measures may provide users with additional meaningful comparisons between current results and results of prior periods as they are expected to be reflective of the core ongoing business.  These measures have limitations, and investors should not consider them in isolation or as a substitute for analysis of the Company’s results as reported under GAAP.  Reconciliations of GAAP to non-GAAP financial measures are attached to this release.

Earnings Webcast Information

Primerica will hold a webcast on Wednesday, February 10, 2021 at 10:00 am EST, to discuss the quarter’s results.  To access the webcast, go to http://investors.primerica.com at least 15 minutes prior to the event to register, download and install any necessary software.  A replay of the call will be available for approximately 30 days on Primerica’s website, http://investors.primerica.com.  This release and a detailed financial supplement will be posted on Primerica’s website.

Forward-Looking Statements

Except for historical information contained in this press release, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements contain known and unknown risks and uncertainties that may cause our actual results in future periods to differ materially from anticipated or projected results. Those risks and uncertainties include, among others, our failure to continue to attract and license new recruits, retain sales representatives or license or maintain the licensing of  sales representatives; new laws or regulations that could apply to our distribution model, which could require us to modify our distribution structure; changes to the independent contractor status of sales representatives; our or sales representatives’ violation of or non-compliance with laws and regulations; any failure to protect the confidentiality of client information; differences between our actual experience and our expectations regarding mortality or persistency as reflected in the pricing for our insurance policies; changes in federal,  state and provincial legislation or regulation that affects our insurance,  investment product, and mortgage businesses; our failure to meet regulatory capital ratios  or other minimum capital and surplus requirements; a significant downgrade by a ratings organization; the failure of our reinsurers or reserve financing counterparties to perform their obligations; the failure of our investment products to remain competitive with other investment options or the loss of our relationship with one or more of the companies whose investment products we provide; litigation and regulatory investigations and actions concerning us or sales representatives; heightened standards of conduct or more stringent licensing requirements for sales representatives; inadequate policies and procedures regarding suitability review of client transactions; revocation of our subsidiary’s status as a non-bank custodian; economic down cycles that impact our business, financial condition and results of operations; major public health pandemics, epidemics or outbreaks or other catastrophic events; the failure of our information technology systems, breach of our information security, failure

of our business continuity plan or the loss of the Internet; the effects of credit deterioration and interest rate fluctuations on our invested asset portfolio and other assets; incorrectly valuing our investments; changes in accounting standards may impact how we record and report our financial condition and results of operations; the inability of our subsidiaries to pay dividends or make distributions; litigation and regulatory investigations and actions; a significant change in the competitive environment in which we operate; the loss of key personnel or sales force leaders; any acquisition or investment in businesses that do not perform as we expect or are difficult to integrate; and fluctuations in the market price of our common stock or Canadian currency exchange rates. These and other risks and uncertainties affecting us are more fully described in our filings with the Securities and Exchange Commission, which are available in the "Investor Relations" section of our website at http://investors.primerica.com. Primerica assumes no duty to update its forward-looking statements as of any future date.

About Primerica, Inc.

Primerica, Inc., headquartered in Duluth, GA, is a leading provider of financial services to middle-income households in the United States and Canada. Primerica educates  clients about how to better prepare for a more secure financial future by assessing their needs and providing appropriate solutions through term life insurance, underwritten by the Company , and mutual funds, annuities and other financial products,  distributed primarily on behalf of third parties. Primerica insured over 5.5 million lives and had approximately 2.6 million client investment accounts at December 31, 2020.  Through its insurance company subsidiaries, Primerica was the #2 issuer of Term Life insurance coverage in North America in 2019. Primerica stock is included in the S&P MidCap 400 and the Russell 1000 stock indices and is traded on The New York Stock Exchange under the symbol “PRI”.

Investor Contact:

Nicole Russell

470-564-6663 Email: investorrelations@primerica.com

Media Contact:

Keith Hancock

470-564-6328

Email: Keith.Hancock@Primerica.com

PRIMERICA, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)
December 31, 2020 December 31, 2019
(In thousands)
Assets
Investments:
Fixed-maturity securities available-for-sale, at fair value $ 2,464,611 $ 2,356,996
Fixed-maturity security held-to-maturity, at amortized cost 1,346,350 1,184,370
Equity securities, at fair value 38,023 40,684
Trading securities, at fair value 16,300 43,233
Policy loans 30,199 32,927
Total investments 3,895,483 3,658,210
Cash and cash equivalents 547,569 256,876
Accrued investment income 17,618 17,361
Reinsurance recoverables 4,273,904 4,169,823
Deferred policy acquisition costs, net 2,629,644 2,325,750
Agent balances, due premiums and other receivables 259,448 227,100
Intangible assets, net 45,275 45,275
Income taxes 73,290 70,492
Operating lease right-of-use assets 46,567 47,265
Other assets 456,967 384,634
Separate account assets 2,659,520 2,485,745
Total assets $ 14,905,285 $ 13,688,531
Liabilities and Stockholders' Equity
Liabilities:
Future policy benefits $ 6,790,557 $ 6,446,569
Unearned and advance premiums 17,136 15,470
Policy claims and other benefits payable 519,711 339,954
Other policyholders' funds 447,765 388,663
Notes payable 374,415 374,037
Surplus note 1,345,772 1,183,728
Income taxes 223,496 209,221
Operating lease liabilities 52,806 53,487
Other liabilities 566,068 510,443
Payable under securities lending 72,154 28,723
Separate account liabilities 2,659,520 2,485,745
Total liabilities 13,069,400 12,036,040
Stockholders' equity:
Common stock 393 412
Paid-in capital - -
Retained earnings 1,705,786 1,593,281
Accumulated other comprehensive income (loss),<br><br><br>net of income tax 129,706 58,798
Total stockholders' equity 1,835,885 1,652,491
Total liabilities and stockholders' equity $ 14,905,285 $ 13,688,531
PRIMERICA, INC. AND SUBSIDIARIES
--- --- --- --- --- --- ---
Condensed Consolidated Statements of Income
(Unaudited)
Three months ended December 31,
2020 2019
(In thousands, except per-share amounts)
Revenues:
Direct premiums $ 750,818 $ 697,060
Ceded premiums (397,676 ) (390,364 )
Net premiums 353,142 306,696
Commissions and fees 204,112 188,302
Net investment income 22,731 22,418
Realized investment gains (losses) 2,650 766
Other, net 15,695 13,778
Total revenues 598,330 531,960
Benefits and expenses:
Benefits and claims 180,945 127,784
Amortization of deferred policy acquisition costs 53,342 67,279
Sales commissions 102,588 94,238
Insurance expenses 49,546 45,991
Insurance commissions 9,263 6,624
Interest expense 7,225 7,222
Other operating expenses 63,781 60,677
Total benefits and expenses 466,690 409,815
Income before income taxes 131,640 122,145
Income taxes 31,556 28,588
Net income $ 100,084 $ 93,557
Earnings per share:
Basic earnings per share $ 2.53 $ 2.25
Diluted earnings per share $ 2.52 $ 2.24
Weighted-average shares used in computing<br><br><br>earnings per share:
Basic 39,421 41,471
Diluted 39,554 41,614
PRIMERICA, INC. AND SUBSIDIARIES
--- --- --- --- --- --- ---
Condensed Consolidated Statements of Income
(Unaudited)
Year ended December 31,
2020 2019
(In thousands, except per-share amounts)
Revenues:
Direct premiums $ 2,907,149 $ 2,753,866
Ceded premiums (1,580,766 ) (1,569,729 )
Net premiums 1,326,383 1,184,137
Commissions and fees 751,271 713,804
Net investment income 83,814 94,073
Realized investment gains (losses) (4,996 ) 4,965
Other, net 61,069 55,525
Total revenues 2,217,541 2,052,504
Benefits and expenses:
Benefits and claims 615,569 493,820
Amortization of deferred policy acquisition costs 224,321 254,552
Sales commissions 376,636 357,198
Insurance expenses 188,117 178,817
Insurance commissions 32,134 25,051
Interest expense 28,839 28,811
Other operating expenses 245,195 237,144
Total benefits and expenses 1,710,811 1,575,393
Income before income taxes 506,730 477,111
Income taxes 120,566 110,720
Net income $ 386,164 $ 366,391
Earnings per share:
Basic earnings per share $ 9.60 $ 8.65
Diluted earnings per share $ 9.57 $ 8.62
Shares used in computing earnings per share:
Basic 40,065 42,181
Diluted 40,185 42,314
PRIMERICA, INC. AND SUBSIDIARIES
--- --- --- --- --- --- --- --- --- ---
Consolidated Adjusted Operating Results Reconciliation
(Unaudited – in thousands, except per share amounts)
Three months ended December 31,
2020 2019 % Change
Total revenues $ 598,330 $ 531,960 12 %
Less: Realized investment gains (losses) 2,650 766
Less: 10% deposit asset MTM included in NII 960 254
Adjusted operating revenues $ 594,720 $ 530,940 12 %
Income before income taxes $ 131,640 $ 122,145 8 %
Less: Realized investment gains (losses) 2,650 766
Less: 10% deposit asset MTM included in NII 960 254
Adjusted operating income before income taxes $ 128,030 $ 121,125 6 %
Net income $ 100,084 $ 93,557 7 %
Less: Realized investment gains (losses) 2,650 766
Less: 10% deposit asset MTM included in NII 960 254
Less: Tax impact of preceding items (865 ) (239 )
Adjusted net operating income $ 97,339 $ 92,776 5 %
Diluted earnings per share ^(1)^ $ 2.52 $ 2.24 13 %
Less: Net after-tax impact of operating adjustments 0.07 0.02
Diluted adjusted operating earnings per share ^(1)^ $ 2.45 $ 2.22 10 %
^(1)^ Percentage change in earnings per share is calculated prior to rounding per share amounts.
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PRIMERICA, INC. AND SUBSIDIARIES
--- --- --- --- --- --- --- --- --- ---
Consolidated Adjusted Operating Results Reconciliation
(Unaudited – in thousands, except per share amounts)
Year ended December 31,
2020 2019 % Change
Total revenues $ 2,217,541 $ 2,052,504 8 %
Less: Realized investment gains (losses) (4,996 ) 4,965
Less: 10% deposit asset MTM included in net<br><br><br>investment income (NII) (1,995 ) 5,382
Adjusted operating revenues $ 2,224,532 $ 2,042,157 9 %
Income before income taxes $ 506,730 $ 477,111 6 %
Less: Realized investment gains (losses) (4,996 ) 4,965
Less: 10% deposit asset MTM included in NII (1,995 ) 5,382
Adjusted operating income before income taxes $ 513,721 $ 466,764 10 %
Net income $ 386,164 $ 366,391 5 %
Less: Realized investment gains (losses) (4,996 ) 4,965
Less: 10% deposit asset MTM included in NII (1,995 ) 5,382
Less: Tax impact of preceding items 1,571 (2,387 )
Adjusted net operating income $ 391,584 $ 358,431 9 %
Diluted earnings per share ^(1)^ $ 9.57 $ 8.62 11 %
Less: Net after-tax impact of operating adjustments (0.13 ) 0.19
Diluted adjusted operating earnings per share ^(1)^ $ 9.70 $ 8.43 15 %
^(1)^ Percentage change in earnings per share is calculated prior to rounding per share amounts.
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TERM LIFE INSURANCE SEGMENT
--- --- --- --- --- --- --- --- --- ---
Adjusted Premiums Reconciliation
(Unaudited – in thousands)
Three months ended December 31,
2020 2019 % Change
Direct premiums $ 745,559 $ 691,546 8 %
Less: Premiums ceded to IPO coinsurers 253,039 264,786
Adjusted direct premiums $ 492,520 $ 426,760 15 %
Ceded premiums $ (395,767 ) $ (388,237 )
Less: Premiums ceded to IPO coinsurers (253,039 ) (264,786 )
Other ceded premiums $ (142,728 ) $ (123,451 )
Net premiums $ 349,792 $ 303,309 15 %
CORPORATE AND OTHER DISTRIBUTED PRODUCTS SEGMENT
--- --- --- --- --- --- --- --- --- ---
Adjusted Operating Results Reconciliation
(Unaudited – in thousands)
Three months ended December 31,
2020 2019 % Change
Total revenues $ 36,022 $ 30,270 19 %
Less: Realized investment gains (losses) 2,650 766
Less: 10% deposit asset MTM included in NII 960 254
Adjusted operating revenues $ 32,412 $ 29,250 11 %
Loss before income taxes $ (14,514 ) $ (12,841 ) 13 %
Less: Realized investment gains (losses) 2,650 766
Less: 10% deposit asset MTM included in NII 960 254
Adjusted operating loss before income taxes $ (18,124 ) $ (13,861 ) 31 %
PRIMERICA, INC. AND SUBSIDIARIES
--- --- --- --- --- --- --- ---
Adjusted Stockholders' Equity Reconciliation
(Unaudited – in thousands)
December 31, 2020 December 31, 2019 % Change
Stockholders' equity $ 1,835,885 $ 1,652,491 11 %
Less: Unrealized net investment gains (losses) recorded<br><br><br>in stockholders' equity, net of income tax 128,128 64,563
Adjusted stockholders' equity $ 1,707,757 $ 1,587,928 8 %

13

pri-ex992_26.htm

Exhibit 99.2

Supplemental Financial Information

Fourth Quarter 2020

Table of Contents PRIMERICA, INC.<br><br><br>Financial Supplement
Page
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Preface, definition of Non-GAAP financial measures 3
Condensed balance sheets and reconciliation of balance sheet non-GAAP to GAAP financial measures 4
Financial results and other statistical data 5
Statements of income 6
Reconciliation of statement of income GAAP to non-GAAP financial measures 7
Segment operating results 8
Term Life Insurance segment - financial results, key statistics, and financial analysis 9-10
Investment and Savings Products segment - financial results, financial analysis, and key statistics 11-12
Investment portfolio 13-15
Five-year historical key statistics 16

This document may contain forward-looking statements and information.  Additional information and factors that could cause actual results to differ materially from any forward-looking statements or information in this document is available in our Form 10-K for the year ended December 31, 2019.

2 of 16

Preface PRIMERICA, INC.<br><br><br>Financial Supplement

Fourth Quarter 2020

This document is a financial supplement to our fourth quarter 2020 earnings release.  It is designed to enable comprehensive analysis of our ongoing business using the same core metrics that our management utilizes in assessing our business and making strategic and operational decisions.  Throughout this document we provide financial information that is derived from our U.S. GAAP financial statements and adjusted for three different purposes, as follows:

• Operating adjustments exclude the impact of realized investment gains/losses, including credit impairments, and mark-to-market (MTM) investment adjustments.  We exclude realized investment gains/losses, including credit impairments, and MTM investment adjustments in measuring adjusted operating revenues to eliminate period-over-period fluctuations that may obscure comparisons of operating results due to items such as the timing of recognizing gains and losses and other factors prior to an invested asset's maturity or sale that are not directly associated with the Company's insurance operations.
• Adjusted stockholders’ equity refers to the removal of the impact of net unrealized gains and losses on invested assets.  We exclude unrealized investment gains and losses in measuring adjusted stockholders' equity as unrealized gains and losses from the Company's invested assets are largely caused by market movements in interest rates and credit spreads that do not necessarily correlate with the cash flows we will ultimately realize when an invested asset matures or is sold.
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• IPO coinsurance transactions adjustments relate to transactions in the first quarter of 2010, where we coinsured between 80% and 90% of our business that was in-force at year-end 2009 to entities then affiliated with Citigroup Inc. that were executed concurrent with our initial public offering (IPO).  We exclude amounts ceded under the IPO coinsurance transactions in measuring adjusted direct premiums and other ceded premiums to present meaningful comparisons of the actual premiums economically maintained by the Company. Amounts ceded under the IPO coinsurance transactions will continue to decline over time as policies terminate within this block of business.
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Management utilizes these non-GAAP financial measures in managing the business and believes they present relevant and meaningful analytical metrics for evaluating the ongoing business.  Reconciliations of non-GAAP to GAAP financial measures are included in this financial supplement.

Certain items throughout this supplement may not add due to rounding and as such, may not agree to other public reporting of the respective item.  Certain items throughout this supplement are noted as ‘na’ to indicate not applicable.  Certain variances are noted as ‘nm’ to indicate not meaningful.  Certain reclassifications have been made to prior-period amounts to conform to current-period reporting classifications. These reclassifications had no impact on net income or total stockholders’ equity.

3 of 16

Condensed Balance Sheets and Reconciliation of Balance Sheet Non-GAAP to GAAP Financial Measures PRIMERICA, INC.<br><br><br>Financial Supplement
(Dollars in thousands) Dec 31,<br><br><br>2018 Mar 31,<br><br><br>2019 Jun 30,<br><br><br>2019 Sep 30,<br><br><br>2019 Dec 31,<br><br><br>2019 Mar 31,<br><br><br>2020 Jun 30,<br><br><br>2020 Sep 30,<br><br><br>2020 Dec 31,<br><br><br>2020
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Condensed Balance Sheets
Assets:
Investments and cash excluding securities held to maturity $ 2,422,734 $ 2,471,745 $ 2,557,033 $ 2,617,685 $ 2,730,715 $ 2,626,043 $ 2,805,065 $ 2,861,883 $ 3,096,703
Securities held to maturity 970,390 1,036,110 1,087,790 1,140,250 1,184,370 1,237,270 1,278,580 1,323,740 1,346,350
Total investments and cash 3,393,124 3,507,855 3,644,823 3,757,935 3,915,085 3,863,313 4,083,645 4,185,623 4,443,053
Due from reinsurers 4,141,569 4,202,903 4,185,850 4,166,362 4,169,823 4,132,897 4,217,129 4,229,088 4,273,904
Deferred policy acquisition costs 2,133,920 2,181,741 2,238,315 2,281,560 2,325,750 2,346,656 2,434,462 2,532,409 2,629,644
Other assets 730,933 814,854 811,426 818,029 792,128 799,122 851,660 885,083 899,164
Separate account assets 2,195,501 2,368,760 2,437,291 2,427,852 2,485,745 2,128,924 2,377,654 2,468,328 2,659,520
Total assets $ 12,595,047 $ 13,076,112 $ 13,317,706 $ 13,451,737 $ 13,688,531 $ 13,270,911 $ 13,964,549 $ 14,300,531 $ 14,905,285
Liabilities:
Future policy benefits $ 6,168,157 $ 6,240,864 $ 6,314,403 $ 6,374,327 $ 6,446,569 $ 6,472,397 $ 6,567,169 $ 6,664,061 $ 6,790,557
Other policy liabilities 700,094 703,123 717,265 714,930 744,087 737,435 855,083 911,454 984,612
Income taxes 187,104 206,180 206,301 207,453 209,221 208,357 265,369 216,639 223,496
Other liabilities 486,772 561,709 551,689 565,894 563,931 554,014 574,425 573,253 618,874
Notes payable 373,661 373,755 373,848 373,942 374,037 374,131 374,226 374,320 374,415
Surplus note 969,685 1,035,421 1,087,117 1,139,592 1,183,728 1,236,644 1,277,970 1,323,146 1,345,772
Payable under securities lending 52,562 64,914 43,867 39,933 28,723 28,896 29,973 48,883 72,154
Separate account liabilities 2,195,501 2,368,760 2,437,291 2,427,852 2,485,745 2,128,924 2,377,654 2,468,328 2,659,520
Total liabilities 11,133,535 11,554,726 11,731,781 11,843,924 12,036,040 11,740,797 12,321,869 12,580,085 13,069,400
Stockholders’ equity:
Common stock (0.01 par value) (1) 427 424 420 415 412 405 397 394 393
Paid-in capital (0 ) (0 ) (0 ) (0 ) (0 ) (0 ) (0 ) 0 0
Retained earnings 1,489,520 1,506,944 1,537,537 1,553,286 1,593,281 1,565,803 1,569,689 1,629,114 1,705,786
Treasury stock — — — — — — — — —
Accumulated other comprehensive income (loss), net:
(7,370 ) 28,916 56,227 66,377 64,564 (1,318 ) 93,726 105,758 128,128
(21,064 ) (14,897 ) (8,258 ) (12,265 ) (5,765 ) (34,776 ) (21,132 ) (14,820 ) 1,578
Total stockholders’ equity 1,461,513 1,521,387 1,585,926 1,607,813 1,652,492 1,530,114 1,642,680 1,720,446 1,835,885
Total liabilities and stockholders' equity $ 12,595,047 $ 13,076,112 $ 13,317,706 $ 13,451,737 $ 13,688,531 $ 13,270,911 $ 13,964,549 $ 14,300,531 $ 14,905,285
Reconciliation of Total Stockholders' Equity to Adjusted Stockholders' Equity
Total stockholders' equity $ 1,461,513 $ 1,521,387 $ 1,585,926 $ 1,607,813 $ 1,652,492 $ 1,530,114 $ 1,642,680 $ 1,720,446 $ 1,835,885
Less: Net unrealized gains (losses) (7,370 ) 28,916 56,227 66,377 64,564 (1,318 ) 93,726 105,758 128,128
Adjusted stockholders’ equity $ 1,468,882 $ 1,492,471 $ 1,529,699 $ 1,541,436 $ 1,587,928 $ 1,531,431 $ 1,548,954 $ 1,614,688 $ 1,707,757
Adjusted Stockholders' Equity Rollforward
Balance, beginning of period $ 1,447,972 $ 1,468,882 $ 1,492,471 $ 1,529,699 $ 1,541,436 $ 1,587,928 $ 1,531,431 $ 1,548,954 $ 1,614,688
Net Income 86,541 79,166 97,446 96,223 93,557 72,469 101,510 112,101 100,084
Shareholder dividends (10,856 ) (14,628 ) (14,517 ) (14,324 ) (14,162 ) (16,530 ) (16,083 ) (15,882 ) (15,851 )
Retirement of shares and warrants (43,338 ) (60,288 ) (57,117 ) (70,679 ) (44,137 ) (95,676 ) (86,513 ) (41,556 ) (13,426 )
Net foreign currency translation adjustment (15,765 ) 6,167 6,639 (4,007 ) 6,500 (29,011 ) 13,645 6,312 16,398
Other, net 4,328 13,171 4,778 4,524 4,734 12,252 4,964 4,759 5,864
Balance, end of period $ 1,468,882 $ 1,492,471 $ 1,529,699 $ 1,541,436 $ 1,587,928 $ 1,531,431 $ 1,548,954 $ 1,614,688 $ 1,707,757
Deferred Policy Acquisition Costs Rollforward
Balance, beginning of period $ 2,107,814 $ 2,133,920 $ 2,181,741 $ 2,238,315 $ 2,281,560 $ 2,325,750 $ 2,346,656 $ 2,434,462 $ 2,532,409
General expenses deferred 8,497 9,163 9,384 9,468 8,608 9,726 9,205 9,702 9,510
Commission costs deferred 96,697 98,196 100,498 100,913 97,538 104,793 120,967 130,719 128,084
Amortization of deferred policy acquisition costs (66,184 ) (64,628 ) (58,762 ) (63,883 ) (67,279 ) (70,311 ) (53,177 ) (47,491 ) (53,342 )
Foreign currency impact and other, net (12,904 ) 5,091 5,455 (3,254 ) 5,322 (23,302 ) 10,812 5,017 12,984
Balance, end of period $ 2,133,920 $ 2,181,741 $ 2,238,315 $ 2,281,560 $ 2,325,750 $ 2,346,656 $ 2,434,462 $ 2,532,409 $ 2,629,644

All values are in US Dollars.

(1) Outstanding common shares exclude restricted stock units.

4 of 16

Financial Results and Other Statistical Data PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q4 YOY YTD
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands, except per-share data) Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 /#<br>Change %<br><br><br>Change YTD<br><br><br>2019 YTD<br><br><br>2020 /#<br>Change %<br><br><br>Change
Earnings per Share
Basic earnings per share:
Weighted-average common shares and fully vested equity awards 42,824,471 42,482,631 41,963,672 41,470,805 41,131,200 40,131,877 39,587,978 39,420,628 ) -4.9 % 42,181,079 40,064,841 ) -5.0%
Net income $ 79,166 $ 97,446 $ 96,223 $ 93,557 $ 72,469 $ 101,510 $ 112,101 $ 100,084 7.0 % $ 366,391 $ 386,164 5.4%
Less income attributable to unvested participating securities (401 ) (428 ) (415 ) (402 ) (310 ) (437 ) (493 ) (433 ) ) -7.6 % (1,654 ) (1,671 ) ) -1.0%
Net income used in computing basic EPS $ 78,765 $ 97,018 $ 95,808 $ 93,155 $ 72,159 $ 101,073 $ 111,608 $ 99,651 7.0 % $ 364,736 $ 384,493 5.4%
Basic earnings per share $ 1.84 $ 2.28 $ 2.28 $ 2.25 $ 1.75 $ 2.52 $ 2.82 $ 2.53 12.5 % $ 8.65 $ 9.60 11.0%
Adjusted net operating income $ 75,303 $ 94,759 $ 95,592 $ 92,776 $ 85,047 $ 98,480 $ 110,718 $ 97,339 4.9 % $ 358,431 $ 391,584 9.2%
Less operating income attributable to unvested participating securities (381 ) (416 ) (412 ) (399 ) (364 ) (424 ) (487 ) (421 ) ) -5.5 % (1,618 ) (1,695 ) ) -4.7%
Adjusted net operating income used in computing basic operating EPS $ 74,922 $ 94,343 $ 95,181 $ 92,377 $ 84,682 $ 98,056 $ 110,231 $ 96,918 4.9 % $ 356,812 $ 389,889 9.3%
Basic adjusted operating income per share $ 1.75 $ 2.22 $ 2.27 $ 2.23 $ 2.06 $ 2.44 $ 2.78 $ 2.46 10.4 % $ 8.46 $ 9.73 15.0%
Diluted earnings per share:
Weighted-average common shares and fully vested equity awards 42,824,471 42,482,631 41,963,672 41,470,805 41,131,200 40,131,877 39,587,978 39,420,628 ) -4.9 % 42,181,079 40,064,841 ) -5.0%
Dilutive impact of contingently issuable shares 118,014 135,719 135,887 143,224 107,361 114,090 122,097 133,544 ) -6.8 % 133,211 120,087 ) -9.9%
Shares used to calculate diluted EPS 42,942,485 42,618,350 42,099,559 41,614,029 41,238,561 40,245,967 39,710,075 39,554,172 ) -4.9 % 42,314,290 40,184,928 ) -5.0%
Net income $ 79,166 $ 97,446 $ 96,223 $ 93,557 $ 72,469 $ 101,510 $ 112,101 $ 100,084 7.0 % $ 366,391 $ 386,164 5.4%
Less income attributable to unvested participating securities (400 ) (427 ) (413 ) (401 ) (310 ) (436 ) (492 ) (431 ) ) -7.6 % (1,650 ) (1,667 ) ) -1.0%
Net income used in computing diluted EPS $ 78,766 $ 97,019 $ 95,809 $ 93,156 $ 72,159 $ 101,074 $ 111,609 $ 99,652 7.0 % $ 364,741 $ 384,497 5.4%
Diluted earnings per share $ 1.83 $ 2.28 $ 2.28 $ 2.24 $ 1.75 $ 2.51 $ 2.81 $ 2.52 12.5 % $ 8.62 $ 9.57 11.0%
Adjusted net operating income $ 75,303 $ 94,759 $ 95,592 $ 92,776 $ 85,047 $ 98,480 $ 110,718 $ 97,339 4.9 % $ 358,431 $ 391,584 9.2%
Less operating income attributable to unvested participating securities (381 ) (415 ) (411 ) (398 ) (364 ) (423 ) (486 ) (420 ) ) -5.5 % (1,614 ) (1,690 ) ) -4.7%
Adjusted net operating income used in computing diluted operating EPS $ 74,923 $ 94,344 $ 95,182 $ 92,379 $ 84,683 $ 98,057 $ 110,232 $ 96,919 4.9 % $ 356,817 $ 389,894 9.3%
Diluted adjusted operating income per share $ 1.74 $ 2.21 $ 2.26 $ 2.22 $ 2.05 $ 2.44 $ 2.78 $ 2.45 10.4 % $ 8.43 $ 9.70 15.1%

All values are in US Dollars.

YOY Q4 YOY YTD
Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 /#<br>Change %<br><br><br>Change YTD<br><br><br>2019 YTD<br><br><br>2020 /#<br>Change %<br><br><br>Change
Annualized Return on Equity
Average stockholders' equity $ 1,491,450 $ 1,553,656 $ 1,596,869 $ 1,630,152 $ 1,591,303 $ 1,586,397 $ 1,681,563 $ 1,778,166 9.1 % $ 1,568,032 $ 1,659,357 5.8 %
Average adjusted stockholders' equity $ 1,480,676 $ 1,511,085 $ 1,535,567 $ 1,564,682 $ 1,559,680 $ 1,540,193 $ 1,581,821 $ 1,661,222 6.2 % $ 1,523,003 $ 1,585,729 4.1 %
Net income return on stockholders' equity 21.2 % 25.1 % 24.1 % 23.0 % 18.2 % 25.6 % 26.7 % 22.5 % % nm 23.4 % 23.3 % % nm
Net income return on adjusted stockholders' equity 21.4 % 25.8 % 25.1 % 23.9 % 18.6 % 26.4 % 28.3 % 24.1 % % nm 24.1 % 24.4 % % nm
Adjusted net operating income return on adjusted stockholders' equity 20.3 % 25.1 % 24.9 % 23.7 % 21.8 % 25.6 % 28.0 % 23.4 % % nm 23.5 % 24.7 % % nm
Capital Structure
Debt-to-capital (1) 19.7 % 19.1 % 18.9 % 18.5 % 19.6 % 18.6 % 17.9 % 16.9 % % nm 18.5 % 16.9 % % nm
Debt-to-capital, excluding AOCI (1) 19.9 % 19.6 % 19.4 % 19.0 % 19.3 % 19.2 % 18.7 % 18.0 % % nm 19.0 % 18.0 % % nm
Cash and invested assets to stockholders' equity 2.3 x 2.3 x 2.3 x 2.4 x 2.5 x 2.5 x 2.4 x 2.4 x x nm 2.4 x 2.4 x x nm
Cash and invested assets to adjusted stockholders' equity 2.4 x 2.4 x 2.4 x 2.5 x 2.5 x 2.6 x 2.6 x 2.6 x x nm 2.5 x 2.6 x x nm
Share count, end of period (2) 42,398,643 42,008,450 41,491,998 41,206,504 40,459,767 39,667,002 39,374,259 39,305,902 ) -4.6 % 41,206,504 39,305,902 ) -4.6 %
Adjusted stockholders' equity per share $ 35.20 $ 36.41 $ 37.15 $ 38.54 $ 37.85 $ 39.05 $ 41.01 $ 43.45 12.7 % $ 38.54 $ 43.45 12.7 %
Financial Strength Ratings - Primerica Life Insurance Co
Moody's A1 A1 A1 A1 A1 A1 A1 A1 nm nm nm nm nm nm
S&P AA- AA- AA- AA- AA- AA- AA- AA- nm nm nm nm nm nm
A.M. Best A+ A+ A+ A+ A+ A+ A+ A+ nm nm nm nm nm nm
Holding Company Senior Debt Ratings
Moody's Baa1 Baa1 Baa1 Baa1 Baa1 Baa1 Baa1 Baa1 nm nm nm nm nm nm
S&P A- A- A- A- A- A- A- A- nm nm nm nm nm nm
A.M. Best a- a- a- a- a- a- a- a- nm nm nm nm nm nm

All values are in US Dollars.

(1) Debt-to-capital is that of the parent company only.  Capital in the debt-to-capital ratio includes stockholders' equity and the note payable.
(2) Share count reflects outstanding common shares, but excludes restricted stock units (RSUs).
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5 of 16

Statements of Income PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q4 YOY YTD
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands) Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Change %<br><br><br>Change YTD<br><br><br>2019 YTD<br><br><br>2020 Change %<br><br><br>Change
Statement of Income
Revenues:
Direct premiums $ 677,286 $ 687,262 $ 692,258 $ 697,060 $ 702,637 $ 717,088 $ 736,606 $ 750,818 7.7 % $ 2,753,866 $ 2,907,149 5.6 %
Ceded premiums (389,795 ) (400,588 ) (388,982 ) (390,364 ) (386,825 ) (402,549 ) (393,716 ) (397,676 ) ) -1.9 % (1,569,729 ) (1,580,766 ) ) -0.7 %
Net premiums 287,491 286,675 303,276 306,696 315,813 314,539 342,890 353,142 15.1 % 1,184,138 1,326,383 12.0 %
Net investment income 24,111 24,868 22,675 22,418 15,420 22,710 22,953 22,731 1.4 % 94,073 83,814 ) -10.9 %
Commissions and fees:
Sales-based (1) 66,997 71,438 69,034 75,418 80,891 62,812 65,600 75,347 ) -0.1 % 282,887 284,651 0.6 %
Asset-based (2) 73,639 79,317 81,009 84,184 81,395 78,146 86,695 93,669 11.3 % 318,149 339,904 6.8 %
Account-based (3) 19,613 19,897 20,449 20,598 20,204 20,478 21,008 21,351 3.7 % 80,555 83,041 3.1 %
Other commissions and fees 7,066 7,817 9,227 8,103 7,579 10,352 11,999 13,746 69.6 % 32,213 43,675 35.6 %
Realized investment (losses) gains 2,847 1,067 285 766 (10,030 ) 1,742 642 2,650 nm 4,965 (4,996 ) ) nm
Other, net 13,223 13,825 14,698 13,778 13,665 15,036 16,674 15,695 13.9 % 55,525 61,069 10.0 %
Total revenues 494,988 504,903 520,654 531,959 524,936 525,815 568,460 598,330 12.5 % 2,052,504 2,217,541 8.0 %
Benefits and expenses:
Benefits and claims 122,284 115,068 128,684 127,784 134,813 139,646 160,166 180,945 41.6 % 493,820 615,569 24.7 %
Amortization of DAC 64,628 58,762 63,883 67,279 70,311 53,177 47,491 53,342 ) -20.7 % 254,552 224,321 ) -11.9 %
Insurance commissions 5,619 5,829 6,980 6,624 6,844 6,333 9,694 9,263 39.8 % 25,051 32,134 28.3 %
Insurance expenses 43,402 44,569 44,854 45,991 48,709 43,753 46,109 49,546 7.7 % 178,817 188,117 5.2 %
Sales commissions:
Sales-based (1) 47,831 50,679 48,652 52,529 56,561 44,834 46,821 52,931 0.8 % 199,690 201,148 0.7 %
Asset-based (2) 32,343 35,665 35,875 37,772 36,323 35,673 39,349 43,227 14.4 % 141,655 154,572 9.1 %
Other sales commissions 3,626 3,755 4,535 3,937 3,723 4,985 5,779 6,430 63.3 % 15,853 20,917 31.9 %
Interest expense 7,180 7,201 7,209 7,222 7,192 7,200 7,221 7,225 nm 28,811 28,839 0.1 %
Other operating expenses 65,706 55,917 54,844 60,676 65,914 56,152 59,348 63,781 5.1 % 237,143 245,195 3.4 %
Total benefits and expenses 392,619 377,444 395,515 409,815 430,391 391,753 421,978 466,690 13.9 % 1,575,393 1,710,811 8.6 %
Income before income taxes 102,368 127,459 125,138 122,145 94,546 134,062 146,482 131,640 7.8 % 477,111 506,730 6.2 %
Income taxes 23,203 30,014 28,916 28,588 22,077 32,552 34,382 31,556 10.4 % 110,720 120,566 8.9 %
Net income $ 79,166 $ 97,446 $ 96,223 $ 93,557 $ 72,469 $ 101,510 $ 112,101 $ 100,084 7.0 % $ 366,391 $ 386,164 5.4 %
Income Before Income Taxes by Segment
Term Life $ 70,339 $ 83,999 $ 83,761 $ 81,995 $ 82,892 $ 94,903 $ 105,316 $ 89,440 9.1 % $ 320,093 $ 372,551 16.4 %
Investment & Savings Products 42,684 47,343 48,794 52,991 47,700 46,859 51,372 56,713 7.0 % 191,812 202,645 5.6 %
Corporate & Other Distributed Products (10,654 ) (3,882 ) (7,416 ) (12,841 ) (36,046 ) (7,700 ) (10,206 ) (14,514 ) ) -13.0 % (34,794 ) (68,466 ) ) -96.8 %
Income before income taxes $ 102,368 $ 127,459 $ 125,138 $ 122,145 $ 94,546 $ 134,062 $ 146,482 $ 131,640 7.8 % $ 477,111 $ 506,730 6.2 %

All values are in US Dollars.

(1) Sales-based - revenues or commission expenses relating to the sales of mutual funds and variable annuities.
(2) Asset-based - revenues or commission expenses relating to the value of assets in client accounts for which we earn ongoing service, distribution, and other fees.
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(3) Account-based - revenues relating to the fee generating client accounts we administer.
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6 of 16

Reconciliation of Statement of Income GAAP to Non-GAAP Financial Measures PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q4 YOY YTD
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands) Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Change %<br><br><br>Change YTD<br><br><br>2019 YTD<br><br><br>2020 Change %<br><br><br>Change
Reconciliation from Term Life Direct Premiums to Term Life Adjusted Direct Premiums
Term Life direct premiums $ 670,755 $ 681,004 $ 685,539 $ 691,546 $ 696,564 $ 711,188 $ 730,273 $ 745,559 7.8 % $ 2,728,844 $ 2,883,583 5.7 %
Less: Premiums ceded to IPO Coinsurers 276,150 272,596 267,856 264,786 260,076 257,529 254,938 253,039 ) -4.4 % 1,081,388 1,025,582 ) -5.2 %
Term Life adjusted direct premiums $ 394,605 $ 408,408 $ 417,683 $ 426,761 $ 436,488 $ 453,659 $ 475,335 $ 492,520 15.4 % $ 1,647,456 $ 1,858,001 12.8 %
Reconciliation from Term Life Ceded Premiums to Term Life Other Ceded Premiums
Term Life ceded premiums $ (388,100 ) $ (398,927 ) $ (387,120 ) $ (388,237 ) $ (385,232 ) $ (400,919 ) $ (392,004 ) $ (395,767 ) ) -1.9 % $ (1,562,383 ) $ (1,573,922 ) ) -0.7 %
Less: Premiums ceded to IPO Coinsurers (276,150 ) (272,596 ) (267,856 ) (264,786 ) (260,076 ) (257,529 ) (254,938 ) (253,039 ) 4.4 % (1,081,388 ) (1,025,582 ) 5.2 %
Term Life other ceded premiums $ (111,950 ) $ (126,330 ) $ (119,264 ) $ (123,451 ) $ (125,156 ) $ (143,390 ) $ (137,066 ) $ (142,728 ) ) -15.6 % $ (480,995 ) $ (548,340 ) ) -14.0 %
Reconciliation from Net Investment Income to Adjusted Net Investment Income
Net Investment Income $ 24,111 $ 24,868 $ 22,675 $ 22,418 $ 15,420 $ 22,710 $ 22,953 $ 22,731 1.4 % $ 94,073 $ 83,814 ) -10.9 %
Less: MTM investment adjustments 2,147 2,447 534 254 (6,379 ) 2,259 1,165 960 nm nm 5,382 (1,995 ) nm nm
Adjusted net investment income $ 21,964 $ 22,421 $ 22,141 $ 22,165 $ 21,799 $ 20,451 $ 21,788 $ 21,771 ) -1.8 % $ 88,691 $ 85,809 ) -3.2 %
Reconciliation from Total Revenues to Adjusted Operating Revenues
Total revenues $ 494,988 $ 504,903 $ 520,654 $ 531,959 $ 524,936 $ 525,815 $ 568,460 $ 598,330 12.5 % $ 2,052,504 $ 2,217,541 8.0 %
Less: Realized investment gains/(losses) 2,847 1,067 285 766 (10,030 ) 1,742 642 2,650 nm nm 4,965 (4,996 ) nm nm
Less: MTM investment adjustments 2,147 2,447 534 254 (6,379 ) 2,259 1,165 960 nm nm 5,382 (1,995 ) nm nm
Adjusted operating revenues $ 489,993 $ 501,389 $ 519,834 $ 530,940 $ 541,346 $ 521,813 $ 566,653 $ 594,720 12.0 % $ 2,042,157 $ 2,224,532 8.9 %
Reconciliation from Income Before Income Taxes to Adjusted Operating Income Before Income Taxes
Income before income taxes $ 102,368 $ 127,459 $ 125,138 $ 122,145 $ 94,546 $ 134,062 $ 146,482 $ 131,640 7.8 % $ 477,111 $ 506,730 6.2 %
Less: Realized investment gains/(losses) 2,847 1,067 285 766 (10,030 ) 1,742 642 2,650 nm nm 4,965 (4,996 ) nm nm
Less: MTM investment adjustments 2,147 2,447 534 254 (6,379 ) 2,259 1,165 960 nm nm 5,382 (1,995 ) nm nm
Adjusted operating income before income taxes $ 97,374 $ 123,945 $ 124,319 $ 121,125 $ 110,955 $ 130,060 $ 144,676 $ 128,030 5.7 % $ 466,764 $ 513,721 10.1 %
Reconciliation from Net Income to Adjusted Net Operating Income
Net income $ 79,166 $ 97,446 $ 96,223 $ 93,557 $ 72,469 $ 101,510 $ 112,101 $ 100,084 7.0 % $ 366,391 $ 386,164 5.4 %
Less: Income before income taxes reconciling items 4,994 3,514 819 1,019 (16,409 ) 4,002 1,807 3,610 nm nm 10,347 (6,991 ) nm nm
Less: Tax impact of income before income taxes reconciling items (1,132 ) (828 ) (189 ) (239 ) 3,832 (972 ) (424 ) (865 ) nm nm (2,387 ) 1,571 nm nm
Adjusted net operating income $ 75,303 $ 94,759 $ 95,592 $ 92,776 $ 85,047 $ 98,480 $ 110,718 $ 97,339 4.9 % $ 358,431 $ 391,584 9.2 %

All values are in US Dollars.

7 of 16

Segment Operating Results PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q4 YOY YTD
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands) Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Change %<br><br><br>Change YTD<br><br><br>2019 YTD<br><br><br>2020 Change %<br><br><br>Change
Term Life Insurance
Revenues:
Direct Premiums $ 670,755 $ 681,004 $ 685,539 $ 691,546 $ 696,564 $ 711,188 $ 730,273 $ 745,559 7.8 % $ 2,728,844 $ 2,883,583 5.7 %
Premiums ceded to IPO coinsurers (1) (276,150 ) (272,596 ) (267,856 ) (264,786 ) (260,076 ) (257,529 ) (254,938 ) (253,039 ) 4.4 % (1,081,388 ) (1,025,582 ) 5.2 %
Adjusted direct premiums (2) 394,605 408,408 417,683 426,761 436,488 453,659 475,335 492,520 15.4 % 1,647,456 1,858,001 12.8 %
Other ceded premiums (3) (111,950 ) (126,330 ) (119,264 ) (123,451 ) (125,156 ) (143,390 ) (137,066 ) (142,728 ) ) -15.6 % (480,995 ) (548,340 ) ) -14.0 %
Net premiums 282,655 282,077 298,419 303,310 311,332 310,269 338,269 349,792 15.3 % 1,166,461 1,309,661 12.3 %
Allocated net investment income 4,444 4,736 5,123 5,619 6,246 6,538 6,813 7,432 32.3 % 19,922 27,030 35.7 %
Other, net 9,744 10,055 10,985 10,063 10,168 11,426 12,717 11,768 16.9 % 40,848 46,079 12.8 %
Revenues 296,843 296,869 314,527 318,992 327,747 328,233 357,799 368,992 15.7 % 1,227,231 1,382,770 12.7 %
Benefits and expenses:
Benefits and claims 118,443 111,480 122,751 122,657 128,563 135,409 156,209 173,767 41.7 % 475,330 593,948 25.0 %
Amortization of DAC 64,066 56,179 61,548 66,918 65,840 52,730 45,529 52,109 ) -22.1 % 248,711 216,208 ) -13.1 %
Insurance commissions 2,163 2,298 3,311 3,009 3,286 2,884 5,946 5,477 82.0 % 10,781 17,592 63.2 %
Insurance expenses 41,832 42,914 43,157 44,413 47,165 42,306 44,800 48,199 8.5 % 172,316 182,471 5.9 %
Benefits and expenses 226,504 212,870 230,766 236,997 244,855 233,330 252,483 279,551 18.0 % 907,138 1,010,219 11.4 %
Income before income taxes $ 70,339 $ 83,999 $ 83,761 $ 81,995 $ 82,892 $ 94,903 $ 105,316 $ 89,440 9.1 % $ 320,093 $ 372,551 16.4 %
Investment & Savings Products
Revenues:
Commissions and fees:
Sales-based $ 66,997 $ 71,438 $ 69,034 $ 75,418 $ 80,891 $ 62,812 $ 65,600 $ 75,347 ) -0.1 % $ 282,887 $ 284,651 0.6 %
Asset-based 73,639 79,317 81,009 84,184 81,395 78,146 86,695 93,669 11.3 % 318,149 339,904 6.8 %
Account-based 19,613 19,897 20,449 20,598 20,204 20,478 21,008 21,351 3.7 % 80,555 83,041 3.1 %
Other, net 2,423 2,434 2,661 2,500 2,542 2,745 3,034 2,949 18.0 % 10,017 11,271 12.5 %
Revenues 162,671 173,085 173,153 182,699 185,033 164,180 176,338 193,316 5.8 % 691,608 718,867 3.9 %
Benefits and expenses:
Amortization of DAC 477 2,101 2,044 (74 ) 4,305 100 1,667 982 nm 4,549 7,055 55.1 %
Insurance commissions 3,025 3,155 3,257 3,297 3,201 3,106 3,377 3,500 6.1 % 12,735 13,184 3.5 %
Sales commissions:
Sales-based 47,831 50,679 48,652 52,529 56,561 44,834 46,821 52,931 0.8 % 199,690 201,148 0.7 %
Asset-based 32,343 35,665 35,875 37,772 36,323 35,673 39,349 43,227 14.4 % 141,655 154,572 9.1 %
Other operating expenses 36,312 34,143 34,530 36,182 36,942 33,608 33,751 35,963 ) -0.6 % 141,168 140,264 ) -0.6 %
Benefits and expenses 119,988 125,742 124,359 129,707 137,332 117,321 124,966 136,603 5.3 % 499,796 516,222 3.3 %
Income before income taxes $ 42,684 $ 47,343 $ 48,794 $ 52,991 $ 47,700 $ 46,859 $ 51,372 $ 56,713 7.0 % $ 191,812 $ 202,645 5.6 %
Corporate & Other Distributed Products
Revenues:
Direct premiums $ 6,531 $ 6,258 $ 6,719 $ 5,514 $ 6,074 $ 5,900 $ 6,333 $ 5,259 ) -4.6 % $ 25,022 $ 23,566 ) -5.8 %
Ceded premiums (1,695 ) (1,661 ) (1,862 ) (2,128 ) (1,593 ) (1,631 ) (1,712 ) (1,909 ) 10.3 % (7,345 ) (6,845 ) 6.8 %
Net premiums 4,836 4,597 4,858 3,386 4,480 4,270 4,621 3,350 ) -1.1 % 17,677 16,721 ) -5.4 %
Allocated net investment income 17,521 17,684 17,018 16,545 15,553 13,913 14,975 14,339 ) -13.3 % 68,768 58,779 ) -14.5 %
Commissions and fees:
Prepaid Legal Services 3,737 4,159 4,776 3,905 3,829 4,557 4,942 5,104 30.7 % 16,577 18,432 11.2 %
Auto and Homeowners Insurance 1,500 1,877 2,165 1,766 1,672 2,263 1,985 2,194 24.2 % 7,308 8,113 11.0 %
Mortgage loans — 10 244 424 264 1,301 3,011 4,146 nm 678 8,722 nm
Other sales commissions 1,829 1,770 2,042 2,008 1,813 2,231 2,061 2,301 14.6 % 7,650 8,407 9.9 %
Other, net 1,056 1,336 1,052 1,215 954 865 922 977 ) -19.6 % 4,660 3,719 ) -20.2 %
Adjusted operating revenues 30,479 31,435 32,154 29,250 28,566 29,400 32,516 32,412 10.8 % 123,318 122,895 ) -0.3 %
Benefits and expenses:
Benefits and claims 3,842 3,588 5,933 5,127 6,249 4,236 3,957 7,178 40.0 % 18,490 21,621 16.9 %
Amortization of DAC 85 482 291 434 166 346 295 251 ) -42.2 % 1,293 1,058 ) -18.1 %
Insurance commissions 431 376 411 318 357 343 371 286 ) -9.8 % 1,535 1,358 ) -11.5 %
Insurance expenses 1,570 1,656 1,697 1,578 1,544 1,447 1,309 1,347 ) -14.7 % 6,501 5,646 ) -13.1 %
Sales commissions 3,626 3,755 4,535 3,937 3,723 4,985 5,779 6,430 63.3 % 15,853 20,917 31.9 %
Interest expense 7,180 7,201 7,209 7,222 7,192 7,200 7,221 7,225 nm 28,811 28,839 0.1 %
Other operating expenses 29,394 21,774 20,314 24,494 28,972 22,544 25,597 27,818 13.6 % 95,976 104,930 9.3 %
Benefits and expenses 46,127 38,831 40,390 43,110 48,203 41,102 44,529 50,535 17.2 % 168,459 184,370 9.4 %
Adjusted operating income before income taxes $ (15,648 ) $ (7,396 ) $ (8,236 ) $ (13,861 ) $ (19,637 ) $ (11,702 ) $ (12,013 ) $ (18,124 ) ) -30.8 % $ (45,141 ) $ (61,475 ) ) -36.2 %

All values are in US Dollars.

(1) Premiums ceded to IPO coinsurers - premiums ceded to IPO coinsurers under the IPO coinsurance transactions excluding any reimbursements from the IPO coinsurers on previously existing reinsurance agreements.
(2) Adjusted direct premiums - direct premiums net of premiums ceded to IPO coinsurers.
--- ---
(3) Other ceded premiums - premiums ceded to non-IPO coinsurers net of any applicable reimbursements from the IPO coinsurers.
--- ---

8 of 16

Term Life Insurance - Financial Results and Analysis PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q4 YOY YTD
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands) Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Change %<br><br><br>Change YTD<br><br><br>2019 YTD<br><br><br>2020 Change %<br><br><br>Change
Term Life Insurance Income Before Income Taxes
Revenues:
Direct Premiums $ 670,755 $ 681,004 $ 685,539 $ 691,546 $ 696,564 $ 711,188 $ 730,273 $ 745,559 7.8 % $ 2,728,844 $ 2,883,583 5.7 %
Premiums ceded to IPO coinsurers (1) (276,150 ) (272,596 ) (267,856 ) (264,786 ) (260,076 ) (257,529 ) (254,938 ) (253,039 ) 4.4 % (1,081,388 ) (1,025,582 ) 5.2 %
Adjusted direct premiums (2) 394,605 408,408 417,683 426,761 436,488 453,659 475,335 492,520 15.4 % 1,647,456 1,858,001 12.8 %
Other ceded premiums (3) (111,950 ) (126,330 ) (119,264 ) (123,451 ) (125,156 ) (143,390 ) (137,066 ) (142,728 ) ) -15.6 % (480,995 ) (548,340 ) ) -14.0 %
Net premiums 282,655 282,077 298,419 303,310 311,332 310,269 338,269 349,792 15.3 % 1,166,461 1,309,661 12.3 %
Allocated net investment income 4,444 4,736 5,123 5,619 6,246 6,538 6,813 7,432 32.3 % 19,922 27,030 35.7 %
Other, net 9,744 10,055 10,985 10,063 10,168 11,426 12,717 11,768 16.9 % 40,848 46,079 12.8 %
Revenues 296,843 296,869 314,527 318,992 327,747 328,233 357,799 368,992 15.7 % 1,227,231 1,382,770 12.7 %
Benefits and expenses:
Benefits and claims 118,443 111,480 122,751 122,657 128,563 135,409 156,209 173,767 41.7 % 475,330 593,948 25.0 %
Amortization of DAC 64,066 56,179 61,548 66,918 65,840 52,730 45,529 52,109 ) -22.1 % 248,711 216,208 ) -13.1 %
Insurance commissions 2,163 2,298 3,311 3,009 3,286 2,884 5,946 5,477 82.0 % 10,781 17,592 63.2 %
Insurance expenses 41,832 42,914 43,157 44,413 47,165 42,306 44,800 48,199 8.5 % 172,316 182,471 5.9 %
Benefits and expenses 226,504 212,870 230,766 236,997 244,855 233,330 252,483 279,551 18.0 % 907,138 1,010,219 11.4 %
Income before income taxes $ 70,339 $ 83,999 $ 83,761 $ 81,995 $ 82,892 $ 94,903 $ 105,316 $ 89,440 9.1 % $ 320,093 $ 372,551 16.4 %
Total Term Life Insurance - Financial Analysis
Post-IPO direct premiums (4) $ 300,708 $ 312,436 $ 320,424 $ 327,939 $ 336,921 $ 352,353 $ 372,852 $ 388,303 18.4 % $ 1,261,507 $ 1,450,428 15.0 %
Pre-IPO direct premiums (5) 370,047 368,568 365,115 363,607 359,643 358,835 357,421 357,256 ) -1.7 % 1,467,337 1,433,155 ) -2.3 %
Total direct premiums $ 670,755 $ 681,004 $ 685,539 $ 691,546 $ 696,564 $ 711,188 $ 730,273 $ 745,559 7.8 % $ 2,728,844 $ 2,883,583 5.7 %
Premiums ceded to IPO coinsurers $ 276,150 $ 272,596 $ 267,856 $ 264,786 $ 260,076 $ 257,529 $ 254,938 $ 253,039 ) -4.4 % $ 1,081,388 $ 1,025,582 ) -5.2 %
% of Pre-IPO direct premiums 74.6 % 74.0 % 73.4 % 72.8 % 72.3 % 71.8 % 71.3 % 70.8 % nm nm 73.7 % 71.6 % nm nm
Benefits and claims, net (6) $ 230,392 $ 237,810 $ 242,016 $ 246,108 $ 253,719 $ 278,799 $ 293,275 $ 316,495 28.6 % $ 956,326 $ 1,142,288 19.4 %
% of adjusted direct premiums 58.4 % 58.2 % 57.9 % 57.7 % 58.1 % 61.5 % 61.7 % 64.3 % nm nm 58.0 % 61.5 % nm nm
DAC amortization & insurance commissions $ 66,229 $ 58,477 $ 64,858 $ 69,927 $ 69,126 $ 55,614 $ 51,474 $ 57,585 ) -17.6 % $ 259,492 $ 233,800 ) -9.9 %
% of adjusted direct premiums 16.8 % 14.3 % 15.5 % 16.4 % 15.8 % 12.3 % 10.8 % 11.7 % nm nm 15.8 % 12.6 % nm nm
Insurance expenses, net (7) $ 32,088 $ 32,858 $ 32,171 $ 34,351 $ 36,997 $ 30,881 $ 32,083 $ 36,431 6.1 % $ 131,468 $ 136,392 3.7 %
% of adjusted direct premiums 8.1 % 8.0 % 7.7 % 8.0 % 8.5 % 6.8 % 6.7 % 7.4 % nm nm 8.0 % 7.3 % nm nm
Total Term Life income before income taxes $ 70,339 $ 83,999 $ 83,761 $ 81,995 $ 82,892 $ 94,903 $ 105,316 $ 89,440 9.1 % $ 320,093 $ 372,551 16.4 %
Term Life operating margin (8) 17.8 % 20.6 % 20.1 % 19.2 % 19.0 % 20.9 % 22.2 % 18.2 % nm nm 19.4 % 20.1 % nm nm

All values are in US Dollars.

(1) Premiums ceded to IPO coinsurers - premiums ceded to IPO coinsurers under the IPO coinsurance transactions excluding any reimbursements from the IPO coinsurers on previously existing reinsurance agreements.
(2) Adjusted direct premiums - direct premiums net of premiums ceded to IPO coinsurers.
--- ---
(3) Other ceded premiums - premiums ceded to non-IPO coinsurers net of any applicable reimbursements from the IPO coinsurers.
--- ---
(4) Post-IPO direct premiums - direct premiums not subject to the 2010 IPO coinsurance transactions.
--- ---
(5) Pre-IPO direct premiums - direct premiums subject to the 2010 IPO coinsurance transactions.
--- ---
(6) Benefits and claims, net - benefits & claims net of other ceded premiums which are largely YRT.
--- ---
(7) Insurance expenses, net - insurance expenses net of other, net revenues.
--- ---
(8) Term Life operating margin - Term Life operating income before income taxes as a percentage of adjusted direct premiums.
--- ---

9 of 16

Term Life Insurance - Key Statistics PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q4 YOY YTD
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands, except as noted) Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 /#<br>Change %<br><br><br>Change YTD<br><br><br>2019 YTD<br><br><br>2020 /#<br>Change %<br><br><br>Change
Key Statistics
Life-insurance licensed sales force, beginning of period 130,736 129,821 129,550 130,871 130,522 130,095 134,157 136,306 4.2 % 130,736 130,522 ) -0.2 %
10,065 10,919 12,682 11,073 10,599 12,250 13,138 12,119 9.4 % 44,739 48,106 7.5 %
(10,980 ) (11,190 ) (11,361 ) (11,422 ) (11,026 ) (8,188 ) (10,989 ) (13,518 ) ) -18.4 % (44,953 ) (43,721 ) 2.7 %
Life-insurance licensed sales force, end of period 129,821 129,550 130,871 130,522 130,095 134,157 136,306 134,907 3.4 % 130,522 134,907 3.4 %
Estimated annualized issued term life premium (mills) (1):
$ 54.1 $ 65.8 $ 63.1 $ 61.8 $ 61.5 $ 77.7 $ 86.0 $ 78.4 26.9 % $ 244.8 $ 303.6 24.0 %
13.8 15.8 15.1 15.4 15.0 17.8 17.9 18.1 17.7 % 60.2 68.9 14.4 %
Total estimated annualized issued term life premium $ 68.0 $ 81.6 $ 78.2 $ 77.2 $ 76.5 $ 95.5 $ 103.9 $ 96.5 25.1 % $ 305.0 $ 372.5 22.1 %
Issued term life policies 64,242 78,664 73,434 71,469 71,318 94,044 100,199 87,307 22.2 % 287,809 352,868 22.6 %
Estimated average annualized issued term life premium per policy (1)(2) $ 843 $ 837 $ 859 $ 864 $ 863 $ 826 $ 858 $ 898 3.9 % $ 851 $ 860 1.1 %
Term life face amount in-force, beginning of period (mills) $ 781,041 $ 785,552 $ 796,376 $ 801,494 $ 808,262 $ 804,512 $ 821,998 $ 840,227 4.8 % $ 781,041 $ 808,262 3.5 %
20,925 25,300 24,087 23,682 23,221 27,754 30,104 28,357 19.7 % 93,994 109,436 16.4 %
(18,383 ) (16,512 ) (17,740 ) (18,884 ) (18,294 ) (14,315 ) (13,733 ) (14,506 ) 23.2 % (71,519 ) (60,848 ) 14.9 %
1,969 2,036 (1,228 ) 1,970 (8,676 ) 4,046 1,859 4,740 140.6 % 4,746 1,968 ) nm
Term life face amount in-force, end of period $ 785,552 $ 796,376 $ 801,494 $ 808,262 $ 804,512 $ 821,998 $ 840,227 $ 858,818 6.3 % $ 808,262 $ 858,818 6.3 %

All values are in US Dollars.

(1)     Estimated annualized issued term life premium - estimated as average premium per $1,000 of face amounts issued on new policies and additions (before free look returns) multiplied by actual face amount issued on new policies, rider additions and face amount increases.

(2)     In whole dollars.

(3)     Issued term life face amount - includes face amount on issued term life policies, additional riders added to existing policies, and face increases under increasing benefit riders.

10 of 16

Investment and Savings Products - Financial Results and Financial Analysis PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q4 YOY YTD
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands, except as noted) Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Change %<br><br><br>Change YTD<br><br><br>2019 YTD<br><br><br>2020 Change %<br><br><br>Change
Investment & Savings Products Income Before Income Taxes
Revenues:
Commissions and fees:
Sales-based $ 66,997 $ 71,438 $ 69,034 $ 75,418 $ 80,891 $ 62,812 $ 65,600 $ 75,347 ) -0.1 % $ 282,887 $ 284,651 0.6 %
Asset-based 73,639 79,317 81,009 84,184 81,395 78,146 86,695 93,669 11.3 % 318,149 339,904 6.8 %
Account-based 19,613 19,897 20,449 20,598 20,204 20,478 21,008 21,351 3.7 % 80,555 83,041 3.1 %
Other, net 2,423 2,434 2,661 2,500 2,542 2,745 3,034 2,949 18.0 % 10,017 11,271 12.5 %
Revenues 162,671 173,085 173,153 182,699 185,033 164,180 176,338 193,316 5.8 % 691,608 718,867 3.9 %
Benefits and expenses:
Amortization of DAC 477 2,101 2,044 (74 ) 4,305 100 1,667 982 nm 4,549 7,055 55.1 %
Insurance commissions 3,025 3,155 3,257 3,297 3,201 3,106 3,377 3,500 6.1 % 12,735 13,184 3.5 %
Sales commissions:
Sales-based 47,831 50,679 48,652 52,529 56,561 44,834 46,821 52,931 0.8 % 199,690 201,148 0.7 %
Asset-based 32,343 35,665 35,875 37,772 36,323 35,673 39,349 43,227 14.4 % 141,655 154,572 9.1 %
Other operating expenses 36,312 34,143 34,530 36,182 36,942 33,608 33,751 35,963 ) -0.6 % 141,168 140,264 ) -0.6 %
Benefits and expenses 119,988 125,742 124,359 129,707 137,332 117,321 124,966 136,603 5.3 % 499,796 516,222 3.3 %
Income before income taxes $ 42,684 $ 47,343 $ 48,794 $ 52,991 $ 47,700 $ 46,859 $ 51,372 $ 56,713 7.0 % $ 191,812 $ 202,645 5.6 %
Financial Analysis
Fees paid based on client asset values (1) $ 5,898 $ 5,705 $ 6,225 $ 6,169 $ 5,990 $ 5,712 $ 6,284 $ 6,772 9.8 % $ 23,998 $ 24,758 3.2 %
Fees paid based on fee-generating positions (2) 11,159 9,658 9,354 9,648 10,248 9,094 8,747 9,547 ) -1.0 % 39,820 37,637 ) -5.5 %
Other operating expenses 19,254 18,780 18,951 20,365 20,704 18,803 18,719 19,644 ) -3.5 % 77,351 77,870 0.7 %
Total other operating expenses $ 36,312 $ 34,143 $ 34,530 $ 36,182 $ 36,942 $ 33,608 $ 33,751 $ 35,963 ) -0.6 % $ 141,168 $ 140,264 ) -0.6 %
Sales-based net revenue as % of revenue-generating sales (3)
U.S. 1.33 % 1.29 % 1.31 % 1.41 % 1.34 % 1.33 % 1.27 % 1.31 % nm nm 1.34 % 1.31 % nm nm
Canada 1.00 % 0.97 % 0.96 % 0.94 % 1.06 % 0.87 % 0.93 % 0.95 % nm nm 0.97 % 0.97 % nm nm
Total 1.28 % 1.25 % 1.27 % 1.35 % 1.30 % 1.27 % 1.23 % 1.26 % nm nm 1.29 % 1.26 % nm nm
Asset-based net revenue as % of average asset values (4)
U.S. 0.036 % 0.038 % 0.038 % 0.039 % 0.038 % 0.037 % 0.038 % 0.038 % nm nm 0.151 % 0.152 % nm nm
Canada 0.136 % 0.120 % 0.121 % 0.138 % 0.098 % 0.133 % 0.119 % 0.124 % nm nm 0.514 % 0.474 % nm nm
Total 0.052 % 0.051 % 0.051 % 0.054 % 0.047 % 0.052 % 0.050 % 0.052 % nm nm 0.208 % 0.201 % nm nm
Account-based net revenue per average fee generating position (5)(6) $ 3.20 $ 3.88 $ 4.18 $ 4.10 $ 3.70 $ 4.19 $ 4.45 $ 4.23 nm nm $ 15.37 $ 16.58 nm nm

All values are in US Dollars.

(1) Fees paid based on client asset values - administration fees on Canadian Segregated Funds and advisory fees on Managed Accounts that vary directly with client asset values.
(2) Fees paid based on fee-generating positions - recordkeeping fees that vary with the number of fee-generating positions.
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(3) Sales-based net revenue - commission and fee revenue less commissions paid to the sales force based on product sales activity.
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(4) Asset-based net revenue - commission and fee revenue less administration and advisory fees paid to third-party providers and commissions paid to the sales force earned based on product account values including amortization of deferred acquisition costs for segregated funds.
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(5) Account-based net revenue - fee revenue less recordkeeping fees paid to third-party providers based on fee-generating positions and certain direct general expenses.
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(6) In whole dollars.
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11 of 16

Investment and Savings Products - Key Statistics PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q4 YOY YTD
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands, except as noted) Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 /#<br>Change %<br><br><br>Change YTD<br><br><br>2019 YTD<br><br><br>2020 /#<br>Change %<br><br><br>Change
Key Statistics
Product sales (mills)
$ 710.2 $ 855.9 $ 829.7 $ 831.9 $ 921.0 $ 758.4 $ 874.1 $ 945.5 13.7 % $ 3,227.8 $ 3,499.0 8.4 %
244.1 199.7 184.9 199.0 280.9 165.2 189.6 256.0 28.6 % 827.6 891.8 7.7 %
81.0 88.2 75.0 76.3 72.2 48.4 47.2 50.6 ) -33.7 % 320.4 218.3 ) -31.9 %
465.8 514.2 512.8 583.7 600.6 440.5 421.7 529.3 ) -9.3 % 2,076.6 1,992.0 ) -4.1 %
Total sales-based revenue generating product sales 1,501.1 1,658.0 1,602.4 1,691.0 1,874.7 1,412.5 1,532.6 1,781.3 5.3 % 6,452.5 6,601.1 2.3 %
161.6 203.5 176.9 197.4 246.2 200.1 223.0 230.7 16.9 % 739.4 900.1 21.7 %
94.3 76.0 76.4 94.6 124.8 73.9 85.3 57.3 ) -39.4 % 341.2 341.3 nm
Total product sales $ 1,757.0 $ 1,937.4 $ 1,855.7 $ 1,983.0 $ 2,245.7 $ 1,686.5 $ 1,841.0 $ 2,069.4 4.4 % $ 7,533.2 $ 7,842.5 4.1 %
$ 244.1 $ 199.7 $ 184.9 $ 199.0 $ 280.9 $ 165.2 $ 189.6 $ 256.0 28.6 % $ 827.6 $ 891.8 7.7 %
94.3 76.0 76.4 94.6 124.8 73.9 85.3 57.3 ) -39.4 % 341.2 341.3 nm
Total Canada product sales 338.4 275.6 261.3 293.6 405.7 239.2 274.9 313.3 6.7 % 1,168.9 1,233.1 5.5 %
Total U.S. product sales 1,418.6 1,661.8 1,594.4 1,689.4 1,840.0 1,447.3 1,566.1 1,756.1 3.9 % 6,364.3 6,609.4 3.9 %
Total product sales $ 1,757.0 $ 1,937.4 $ 1,855.7 $ 1,983.0 $ 2,245.7 $ 1,686.5 $ 1,841.0 $ 2,069.4 4.4 % $ 7,533.2 $ 7,842.5 4.1 %
Client asset values, beginning of period (mills) $ 57,704 $ 63,602 $ 65,878 $ 66,222 $ 70,537 $ 59,036 $ 68,224 $ 72,606 9.6 % $ 57,704 $ 70,537 22.2 %
1,757 1,937 1,856 1,983 2,246 1,686 1,841 2,069 4.4 % 7,533 7,843 4.1 %
(1,530 ) (1,633 ) (1,669 ) (1,596 ) (1,703 ) (1,074 ) (1,333 ) (1,427 ) 10.6 % (6,428 ) (5,538 ) 13.9 %
Net flows 227 305 186 387 543 613 508 642 65.8 % 1,105 2,305 nm
201 225 (136 ) 217 (978 ) 404 205 539 148.4 % 507 170 ) nm
5,470 1,746 294 3,710 (11,065 ) 8,171 3,669 7,745 108.8 % 11,221 8,521 ) nm
Client asset values, end of period $ 63,602 $ 65,878 $ 66,222 $ 70,537 $ 59,036 $ 68,224 $ 72,606 $ 81,533 15.6 % $ 70,537 $ 81,533 15.6 %
1.6 % 1.9 % 1.1 % 2.3 % 3.1 % 4.2 % 3.0 % 3.5 % % nm 1.9 % 3.3 % % nm
Average client asset values (mills)
$ 30,266 $ 31,744 $ 32,521 $ 33,658 $ 32,693 $ 31,586 $ 35,204 $ 37,562 11.6 % $ 32,047 $ 34,261 6.9 %
7,390 7,795 7,991 8,218 7,950 7,573 8,525 9,186 11.8 % 7,849 8,309 5.9 %
3,241 3,455 3,652 3,901 3,905 3,871 4,325 4,703 20.5 % 3,563 4,201 17.9 %
2,182 2,247 2,296 2,342 2,389 2,427 2,446 2,469 5.4 % 2,267 2,433 7.3 %
16,057 16,807 17,114 17,661 17,292 16,890 18,551 19,634 11.2 % 16,910 18,092 7.0 %
2,314 2,378 2,428 2,455 2,366 2,291 2,461 2,536 3.3 % 2,394 2,413 0.8 %
Total $ 61,451 $ 64,426 $ 66,002 $ 68,236 $ 66,595 $ 64,638 $ 71,512 $ 76,090 11.5 % $ 65,029 $ 69,709 7.2 %
$ 7,390 $ 7,795 $ 7,991 $ 8,218 $ 7,950 $ 7,573 $ 8,525 $ 9,186 11.8 % $ 7,849 $ 8,309 5.9 %
2,314 2,378 2,428 2,455 2,366 2,291 2,461 2,536 3.3 % 2,394 2,413 0.8 %
Total Canada average client assets 9,704 10,173 10,418 10,674 10,316 9,864 10,986 11,722 9.8 % 10,242 10,722 4.7 %
Total U.S. average client assets 51,747 54,253 55,583 57,563 56,279 54,775 60,526 64,368 11.8 % 54,787 58,987 7.7 %
Total average client assets $ 61,451 $ 64,426 $ 66,002 $ 68,236 $ 66,595 $ 64,638 $ 71,512 $ 76,090 11.5 % $ 65,029 $ 69,709 7.2 %
Average number of fee-generating positions (thous) (3)
1,998 1,996 2,007 2,020 2,031 2,048 2,072 2,091 3.5 % 2,005 2,060 2.7 %
641 641 646 650 658 671 685 697 7.2 % 644 678 5.2 %
Total 2,639 2,637 2,653 2,670 2,689 2,718 2,757 2,788 4.4 % 2,650 2,738 3.3 %

All values are in US Dollars.

(1) Asset value outflows - include (a) redemptions of assets, (b) sales charges on the inflow sales figures, and (c) the net flow of money market funds sold and redeemed on the company's recordkeeping platform.  The redemptions of assets must be estimated for approximately 4% of account values as these figures are not readily available.  Actual redemptions as a percentage of account values for similar known account values are used to estimate the unknown redemption values.
(2) Change in market value, net - market value fluctuations net of fees and expenses.
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(3) Fee generating positions - mutual fund positions for which we receive recordkeeping fees. An individual client account may include multiple mutual fund positions. We may also receive fees earned for custodial services that we provide to clients with retirement plan accounts that hold positions in these mutual funds.
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12 of 16

Investment Portfolio - Summary of Holdings PRIMERICA, INC.<br><br><br>Financial Supplement
As of or for the period ended December 31, 2020
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
% of Total Avg
Market Amortized Unrealized Market Amortized Book Avg
(Dollars in thousands) Value Cost G/(L) Value Cost Yield Rating
Investment Portfolio by Asset Class
Cash, Cash Equivalents, and Short Term $ 547,569 $ 547,569 $ - 17.9 % 18.9 %
Fixed Income:
Treasury 26,579 25,665 915 0.9 % 0.9 % 2.15 % AAA
Government 289,172 269,714 19,457 9.4 % 9.3 % 2.90 % AA-
Tax-Exempt Municipal 48,335 45,393 2,942 1.6 % 1.6 % 2.78 % AA
Public Corporate 1,459,660 1,348,447 111,213 47.6 % 46.5 % 3.68 % BBB+
Mortgage Backed 293,856 281,952 11,904 9.6 % 9.7 % 2.67 % AAA
Asset Backed 69,755 69,326 429 2.3 % 2.4 % 3.16 % AA-
CMBS 112,865 107,020 5,845 3.7 % 3.7 % 3.01 % AA+
Private Placements 174,615 164,574 10,041 5.7 % 5.7 % 4.39 % BBB
Redeemable Preferred 6,074 5,447 627 0.2 % 0.2 % 5.47 % BBB
Total Fixed Income 2,480,912 2,317,539 163,373 81.0 % 79.9 % 3.44 % A
Equities and Other:
Perpetual Preferred 13,570 13,570 - 0.4 % 0.5 %
Common Stock 16,976 16,976 0 0.6 % 0.6 %
Mutual Fund 5,445 5,445 0 0.2 % 0.2 %
Derivatives 57 57 - 0.0 % 0.0 %
Other - - - 0.0 % 0.0 %
Total Equities 36,049 36,049 0 1.2 % 1.2 %
Total Invested Assets $ 3,064,529 $ 2,901,156 $ 163,373 100.0 % 100.0 %
Public Corporate Portfolio by Sector
Consumer Non Cyclical $ 178,848 $ 165,586 $ 13,262 12.3 % 12.3 %
Energy 163,207 150,023 13,184 11.2 % 11.1 %
Insurance 139,857 128,685 11,172 9.6 % 9.5 %
REITs 129,336 118,475 10,861 8.9 % 8.8 %
Banking 128,610 120,745 7,865 8.8 % 9.0 %
Technology 125,357 115,416 9,940 8.6 % 8.6 %
Consumer Cyclical 116,202 107,569 8,633 8.0 % 8.0 %
Capital Goods 87,204 82,468 4,736 6.0 % 6.1 %
Transportation 77,963 73,983 3,980 5.3 % 5.5 %
Electric 77,442 70,541 6,901 5.3 % 5.2 %
Basic Industry 71,869 65,865 6,004 4.9 % 4.9 %
Communications 70,588 63,470 7,118 4.8 % 4.7 %
Brokerage 52,272 47,818 4,454 3.6 % 3.5 %
Finance Companies 21,475 19,611 1,864 1.5 % 1.5 %
Industrial Other 8,170 7,654 516 0.6 % 0.6 %
Natural Gas 6,540 6,089 451 0.4 % 0.5 %
Financial Other 3,615 3,450 165 0.2 % 0.3 %
Utility Other 1,105 998 107 0.1 % 0.1 %
Total Corporate portfolio $ 1,459,660 $ 1,348,447 $ 111,213 100.0 % 100.0 %
Fixed-Maturity Securities - Effective Maturity
Effective maturity
< 1 Yr. $ 227,110 $ 224,089 $ 3,021 9.2 % 9.7 % 3.21 %
1-2 Yrs. 301,570 290,372 11,198 12.2 % 12.5 % 3.57 %
2-5 Yrs. 955,990 889,925 66,065 38.5 % 38.4 % 3.48 %
5-10 Yrs. 675,688 620,426 55,262 27.2 % 26.8 % 3.41 %
> 10 Yrs. 320,554 292,727 27,827 12.9 % 12.6 % 3.41 %
Total Fixed Income $ 2,480,912 $ 2,317,539 $ 163,373 100.0 % 100.0 % 3.44 %
Duration
Fixed Income portfolio duration 4.7 years

Note:  Investment Portfolio pages in this Financial Supplement exclude the Held to Maturity asset on our balance sheet.

13 of 16

Investment Portfolio - Quality Ratings As of December 31, 2020 PRIMERICA, INC.<br><br><br>Financial Supplement
(Dollars in thousands)
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Investment Portfolio Quality Ratings (1)
Amortized  Cost % of Total
Total Fixed Income portfolio:
Rating
AAA $ 433,763 18.7 %
AA 294,429 12.7 %
A 515,752 22.3 %
BBB 979,867 42.3 %
Below Investment Grade 90,947 3.9 %
NA 2,780 0.1 %
Total Fixed Income $ 2,317,539 100.0 %
Amortized  Cost % of Total Amortized  Cost % of Total
Public Corporate asset class: Private Placement asset class:
Rating Rating
AAA $ 11,415 0.9 % AAA $ - —
AA 75,594 5.6 % AA 5,597 3.4 %
A 355,986 26.4 % A 19,104 11.6 %
BBB 832,957 61.8 % BBB 124,279 75.5 %
Below Investment Grade 71,547 5.3 % Below Investment Grade 15,594 9.5 %
NA 949 0.1 % NA - —
Total Corporate $ 1,348,447 100.0 % Total Private $ 164,574 100.0 %
CMBS asset class: Mortgage-Backed asset class:
Rating Rating
AAA $ 83,186 77.7 % AAA $ 245,627 87.1 %
AA - — AA 26,193 9.3 %
A 23,758 22.2 % A 9,827 3.5 %
BBB - — BBB 125 0.0 %
Below Investment Grade 77 0.1 % Below Investment Grade 143 0.1 %
NA - — NA 37 0.0 %
Total CMBS $ 107,020 100.0 % Total Mortgage-Backed $ 281,952 100.0 %
Asset-Backed asset class: Treasury & Government asset classes:
Rating Rating
AAA $ 28,656 41.3 % AAA $ 61,378 20.8 %
AA 3,451 5.0 % AA 150,428 50.9 %
A 30,117 43.4 % A 71,688 24.3 %
BBB 4,618 6.7 % BBB 8,989 3.0 %
Below Investment Grade 691 1.0 % Below Investment Grade 2,896 1.0 %
NA 1,794 2.6 % NA 0 0.0 %
Total Asset-Backed $ 69,326 100.0 % Total Treasury & Government $ 295,379 100.0 %
NAIC Designations
1 $ 951,747 49.8 %
2 905,278 45.9 %
3 74,369 3.6 %
4 13,054 0.7 %
5 - 0.0 %
6 0 0.0 % `
U.S. Insurer Fixed Income (2) 1,944,448 100.0 %
Other (3) 409,139
Cash and cash equivalents 547,569
Total Invested Assets $ 2,901,156
(1) Ratings method for split ratings: If by 2 NRSROs, use lower of the two; if by 3 or more NRSROs, use second lowest.
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(2) NAIC ratings for our U.S. insurance companies' fixed income portfolios.
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(3) Other consists of assets held by our non-life companies, Canadian insurance company, and unrated equities.
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Note:  Investment Portfolio pages in this Financial Supplement exclude the Held to Maturity asset on our balance sheet.

14 of 16

Investment Portfolio - Supplemental Data and Trends PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q4
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands) Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Change %<br><br><br>Change
Net Investment Income by Source
Fixed-maturity securities (available-for-sale) $ 20,333 $ 20,345 $ 20,380 $ 20,772 $ 20,784 $ 20,213 $ 20,882 $ 20,925 0.7%
Fixed-maturity securities (held-to-maturity) 10,674 11,769 12,769 13,113 13,472 14,074 14,704 15,223 16.1%
Equity Securities 487 446 448 464 451 461 433 406 ) -12.5%
Deposit asset underlying 10% reinsurance treaty 1,755 2,141 2,105 2,046 1,830 1,394 1,694 1,330 ) -35.0%
Deposit asset - Mark to Market 2,147 2,447 534 254 (6,379 ) 2,259 1,165 960 278.0%
Policy loans and other invested assets 467 299 234 215 189 541 242 272 26.5%
Cash & cash equivalents 1,056 1,414 1,191 950 843 143 114 103 ) -89.2%
Total investment income 36,919 38,862 37,661 37,814 31,190 39,085 39,234 39,219 3.7%
Investment expenses 2,134 2,225 2,217 2,283 2,298 2,300 1,577 1,265 ) -44.6%
Interest Expense on Surplus Note 10,674 11,769 12,769 13,113 13,472 14,074 14,704 15,223 16.1%
Net investment income $ 24,111 $ 24,868 $ 22,675 $ 22,418 $ 15,420 $ 22,710 $ 22,953 $ 22,731 1.4%
Fixed income book yield, end of period 3.85 % 3.74 % 3.65 % 3.54 % 3.55 % 3.54 % 3.45 % 3.44 %
New money yield 3.56 % 3.10 % 2.73 % 2.73 % 3.25 % 3.14 % 2.44 % 2.67 %
YOY Q4
Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 % Pt<br>Change
Fixed Income Portfolio Quality Ratings
Rating
AAA 21.4 % 20.9 % 23.0 % 24.0 % 22.9 % 21.5 % 19.6 % 18.7 % %
AA 10.9 % 11.3 % 11.0 % 11.7 % 12.1 % 11.6 % 12.8 % 12.7 % %
A 22.9 % 22.9 % 22.1 % 23.4 % 22.9 % 22.3 % 21.8 % 22.3 % %
BBB 41.8 % 41.8 % 41.0 % 38.2 % 38.9 % 40.4 % 42.0 % 42.3 % %
Below Investment Grade 2.9 % 3.0 % 2.8 % 2.6 % 3.1 % 4.0 % 3.8 % 3.9 % %
NA 0.1 % 0.1 % 0.1 % 0.1 % 0.1 % 0.1 % 0.1 % 0.1 % %
Total Fixed Income 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % %
Average rating by amortized cost A A A A A A A A

All values are in US Dollars.

As of December 31, 2020 As of December 31, 2020 As of December 31, 2020
Market<br><br><br>Value Amortized<br><br><br>Cost Credit<br><br><br>Rating Market<br><br><br>Value Amortized<br><br><br>Cost Market<br><br><br>Value Amortized<br><br><br>Cost
Top 25 Exposures Foreign Exposure (1) Government Investments (1)
1 Canada $ 21,814 $ 21,008 AAA Canada $ 74,772 $ 67,958 AAA $ 3,290 $ 3,251
2 Province of Ontario Canada 20,179 19,222 A+ United Kingdom 37,182 35,157 AA 10,027 9,619
3 Province of Quebec Canada 16,713 15,106 AA- Australia 37,113 34,676 A 8,879 8,322
4 Province of Alberta Canada 13,198 12,236 A+ Bermuda 14,635 13,760 BBB 7,805 6,998
5 Province of New Brunswick Canada 12,534 11,644 A+ Ireland 13,727 12,835 Below Investment Grade 2,981 2,896
6 Enbridge Inc 12,430 11,630 BBB+ Germany 11,256 10,954 NA - -
7 Province of British Columbia Canada 11,063 10,604 AAA Cayman Islands 11,209 11,023 Total $ 32,981 $ 31,086
8 Province of Newfoundland and Labrador 10,385 9,213 A Netherlands 10,397 8,940
9 Wells Fargo & Co 10,337 10,041 A- France 10,169 9,577
10 General Motors Co 10,199 9,263 BBB Switzerland 9,225 8,987 Non-Government Investments (1)
11 City of Toronto Canada 9,775 9,028 AA Mexico 6,665 6,135
12 Province of Manitoba Canada 9,411 8,764 A+ Japan 6,050 5,450 AAA $ 4,208 $ 4,184
13 Municipal Finance Authority of British Columbia 9,383 8,866 AAA Norway 5,085 4,957 AA 15,818 15,354
14 Discovery Inc 8,666 6,972 BBB- Israel 4,036 3,550 A 60,045 56,485
15 Brookfield Asset Management Inc 8,471 7,454 A- Luxembourg 3,649 3,500 BBB 156,200 143,660
16 Simon Property Group Inc 8,389 7,663 A Emerging Markets  (2) 11,364 10,380 Below Investment Grade 19,764 18,414
17 CVS Health Corp 8,227 7,955 BBB All Other 22,481 21,344 NA - -
18 Morgan Stanley 8,160 7,570 A+ Total $ 289,016 $ 269,182 Total $ 256,035 $ 238,096
19 Truist Financial Corp 8,078 7,497 A-
20 City of Montreal Canada 8,023 6,919 AA-
21 General Mills Inc 7,916 7,347 BBB
22 Deere & Co 7,810 7,286 A
23 ConocoPhillips 7,767 6,065 A
24 Booking Holdings Inc 7,679 7,053 A-
25 Broadcom Inc 7,660 6,725 BBB-
Total $ 264,265 $ 243,132
% of total fixed income portfolio 8.6 % 8.4 %
(1) US$ denominated investments in issuers outside of the United States based on country of risk.
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(2) Emerging markets is as defined by MSCI, Inc. which include Chile, India, Peru, Poland and South Africa.
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Note:  Investment Portfolio pages in this Financial Supplement exclude the Held to Maturity asset on our balance sheet.

15 of 16

Five-Year Historical Key Statistics PRIMERICA, INC.<br><br><br>Financial Supplement
(Dollars in millions) 2016 2017 2018 2019 2020 Q1<br><br><br>2019 Q2<br><br><br>2019 Q3<br><br><br>2019 Q4<br><br><br>2019 Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Recruits 262,732 303,867 290,886 282,207 400,345 63,223 86,173 72,345 60,466 84,762 133,123 101,861 80,599
Life-insurance licensed sales force, beginning of period 106,710 116,827 126,121 130,736 130,522 130,736 129,821 129,550 130,871 130,522 130,095 134,157 136,306
New life-licensed representatives 44,724 48,535 48,041 44,739 48,106 10,065 10,919 12,682 11,073 10,599 12,250 13,138 12,119
Non-renewal and terminated representatives (34,607 ) (39,241 ) (43,426 ) (44,953 ) (43,721 ) (10,980 ) (11,190 ) (11,361 ) (11,422 ) (11,026 ) (8,188 ) (10,989 ) (13,518 )
Life-insurance licensed sales force, end of period 116,827 126,121 130,736 130,522 134,907 129,821 129,550 130,871 130,522 130,095 134,157 136,306 134,907
Issued term life policies 298,244 312,799 301,589 287,809 352,868 64,242 78,664 73,434 71,469 71,318 94,044 100,199 87,307
Issued term life face amount $ 89,869 $ 95,635 $ 95,209 $ 93,994 $ 109,436 $ 20,925 $ 25,300 $ 24,087 $ 23,682 $ 23,221 $ 27,754 $ 30,104 $ 28,357
Term life face amount in force, beginning of period $ 693,194 $ 728,385 $ 763,831 $ 781,041 $ 808,262 $ 781,041 $ 785,552 $ 796,376 $ 801,494 $ 808,262 $ 804,512 $ 821,998 $ 840,227
Issued term life face amount 89,869 95,635 95,209 93,994 109,436 20,925 25,300 24,087 23,682 23,221 27,754 30,104 28,357
Terminated term life face amount (57,238 ) (65,958 ) (70,291 ) (71,519 ) (60,848 ) (18,383 ) (16,512 ) (17,740 ) (18,884 ) (18,294 ) (14,315 ) (13,733 ) (14,506 )
Foreign currency impact, net 2,560 5,769 (7,708 ) 4,746 1,968 1,969 2,036 (1,228 ) 1,970 (8,676 ) 4,046 1,859 4,740
Term life face amount in force, end of period $ 728,385 $ 763,831 $ 781,041 $ 808,262 $ 858,818 $ 785,552 $ 796,376 $ 801,494 $ 808,262 $ 804,512 $ 821,998 $ 840,227 $ 858,818
Estimated annualized issued term life premium
Premium from new policies $ 237.9 $ 255.4 $ 250.8 $ 244.8 $ 303.6 $ 54.1 $ 65.8 $ 63.1 $ 61.8 $ 61.5 $ 77.7 $ 86.0 $ 78.4
Additions and increases in premium 46.4 49.5 55.2 60.2 68.9 13.8 15.8 15.1 15.4 15.0 17.8 17.9 18.1
Total estimated annualized issued term life premium $ 284.3 $ 304.9 $ 306.0 $ 305.0 $ 372.5 $ 68.0 $ 81.6 $ 78.2 $ 77.2 $ 76.5 $ 95.5 $ 103.9 $ 96.5
Investment & Savings product sales $ 5,594.3 $ 6,192.2 $ 7,040.1 $ 7,533.2 $ 7,842.5 $ 1,757.0 $ 1,937.4 $ 1,855.7 $ 1,983.0 $ 2,245.7 $ 1,686.5 $ 1,841.0 $ 2,069.4
Investment & Savings average client asset values $ 49,427 $ 56,791 $ 61,842 $ 65,029 $ 69,709 $ 61,451 $ 64,426 $ 66,002 $ 68,236 $ 66,595 $ 64,638 $ 71,512 $ 76,090
Closed U.S. Mortgage Volume (brokered) $ — $ — $ — $ 31.1 $ 442.5 $ — $ 0.7 $ 12.3 $ 18.1 $ 12.9 $ 65.8 $ 160.0 $ 203.8

16 of 16

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