Equibles

8-K

Primerica, Inc. (PRI)

8-K 2021-05-05 For: 2021-05-05
View Original
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):      May 5, 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) (IRS Employer<br>Identification No.)
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 May 5, 2021, Primerica, Inc. (the “Company”) announced its results of operations for the quarter ended March 31, 2021. 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 https://investors.primerica.com.

Item 7.01Regulation FD Disclosure.

On May 5, 2021, the Company posted to the “Investor Relations” section of its website certain supplemental financial information relating to the quarter ended March 31, 2021.  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 May 5, 2021 – Primerica Reports First Quarter 2021 Results
99.2 Primerica, Inc. Supplemental Financial Information – First Quarter 2021
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:  May 5, 2021 PRIMERICA, INC.
/s/ Alison S. Rand
Alison S. Rand
Executive Vice President and Chief Financial Officer

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pri-ex991_7.htm

Exhibit 99.1

PRIMERICA REPORTS FIRST QUARTER 2021 RESULTS

Investment and Savings Products sales increase 27% to a record $2.9 billion

Issued Term Life policies grow 16%

Strong momentum in recruiting continues; new recruits up 12%

Net earnings per diluted share (EPS) of $2.46, up 41%; return on stockholders’ equity (ROE) of 21.1%

Diluted adjusted operating EPS of $2.44, up 19%; adjusted net operating income return on adjusted stockholders’ equity (ROAE) of 22.2%

Declared dividend of $0.47 per share, payable on June 14, 2021

Duluth, GA, May 5, 2021 – Primerica, Inc. (NYSE: PRI) today announced financial results for the quarter ended March 31, 2021.  Total revenues of $637.7 million increased 21% compared to the first quarter of 2020.  Net income of $97.9 million increased 35%, while earnings per diluted share of $2.46 increased 41% compared to the same quarter last year.  As previously disclosed, last year’s first quarter included pre-tax realized losses on the invested asset portfolio of $10.0 million and mark-to-market adjustments on the reinsurance deposit asset of $6.4 million, driven by a sharp market downturn at the onset of the COVID pandemic.  ROE was 21.1% for the current quarter compared to 18.2% in the first quarter of 2020.

Adjusted operating revenues, adjusted net operating income and diluted adjusted operating earnings per share, which are non-GAAP financial measures, exclude the impact of realized gains/losses and the mark-to-market adjustment on the reinsurance deposit asset.  A reconciliation of non-GAAP to GAAP financial measures is included at the end of this release.

Adjusted operating revenues were $636.7 million, increasing 18% compared to the first quarter of 2020.  Adjusted net operating income of $97.1 million increased 14%, while diluted adjusted operating earnings per share of $2.44 increased 19% compared to the same quarter last year.  ROAE was 22.2% during the first quarter of 2021 and 21.8% during the first quarter of 2020.

First quarter results reflect strong performance in the Investment and Savings Products (ISP) segment and the continued benefit of increased sales and heightened persistency in the Term Life segment.  ISP sales were particularly robust at $2.9 billion, increasing 27% year-over-year due to increased demand for mutual funds and managed accounts.  Demand for variable annuities also improved, increasing 7% compared to a robust first quarter in 2020.  The Term Life segment continues to see strong demand for protection products, which directly impacts sales and persistency as well as higher claims as a result of the pandemic.  During the quarter, the Company incurred approximately $21 million in COVID-related death claims, net of reinsurance.  The onset of COVID in March 2020 had no significant impact on last year’s first quarter financial results.

“Our exceptional first quarter results reflect the strength of our business and the continuing momentum created by our ability to meet the financial needs of middle-market families,” said Glenn Williams, Chief Executive Officer. “The impact of COVID has heightened consumer awareness concerning their finances, helping to drive record production results for Primerica, including in recruiting, issued life policies and investment sales.”

First Quarter Distribution & Segment Results

Distribution Results
Q1 2021 Q1 2020 % Change
Life-Licensed Sales Force ^(1)^ 132,030 130,095 1 %
Recruits 94,633 84,762 12 %
New Life-Licensed Representatives 10,833 10,599 2 %
Life Insurance Policies Issued 82,667 71,318 16 %
Life Productivity^(2)^ 0.21 0.18 *
ISP Product Sales ($ billions) $ 2.85 $ 2.25 27 %
Average Client Asset Values ($ billions) $ 83.13 $ 66.59 25 %
Closed U.S. Mortgage Volume ($ million brokered) $ 262.3 $ 12.9 *
^(1)^ End of period
--- ---
^(2)^ Life productivity equals policies issued divided by the average number of life insurance licensed representatives per month
--- ---

*     Not calculated

Segment Results
Q1 2021 Q1 2020 % Change
( in thousands)
Adjusted Operating Revenues:
Term Life Insurance $ 327,746 17 %
Investment and Savings Products 185,032 21 %
Corporate and Other Distributed Products ^(1)^ 28,567 10 %
Total adjusted operating revenues ^(1)^ $ 541,345 18 %
Adjusted Operating Income (Loss) before<br><br><br>income taxes:
Term Life Insurance $ 82,892 6 %
Investment and Savings Products 47,700 33 %
Corporate and Other Distributed Products ^(1)^ ) (19,637 ) 24 %
Total adjusted operating income before<br><br><br>income taxes ^(1)^ $ 110,955 15 %

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

Recruiting activity remained strong during the first quarter, with a total of more than 94 thousand individuals recruited, an increase of 12% year-over-year.  The licensing process remained challenged as social-distancing measures limited pre-licensing class access and states continued to work through COVID-related backlogs.  As a result, the Company saw only a 2% increase in licensing.

At March 31, 2021, the Company had a total of 132,030 independent life-licensed representatives, including an estimated 2,400 individuals who we expect will not pursue the steps necessary to convert a COVID-related temporary license to a permanent license or renew a license with a COVID-related extended renewal date.  Excluding these individuals from the quarter-end count, the total number of life-licensed representatives was largely unchanged year-over-year.

Term Life Insurance

Clients continue to prioritize protection for their families, which amplifies demand for our products.  During the quarter, the Company issued nearly 83 thousand life insurance policies, an increase of 16% compared to the first quarter of 2020.  This increased demand led productivity during the quarter to 0.21 policies per life-licensed representative per month compared to 0.18 in the prior year’s first quarter.

Revenues of $382.0 million increased 17% compared to the prior year’s first quarter, driven largely by a 16% increase in adjusted direct premiums.  Pre-tax income of $88.2 million increased 6% year-over-year.  Higher sales, along with favorable persistency trends, continued to positively impact adjusted direct premiums, adding an estimated $9 million to pre-tax operating income during the first quarter of 2021.  Strong persistency also led to $12 million less DAC amortization, partly offset by $7 million higher benefit reserve increases.  The Company also incurred an estimated $21 million in COVID-related death claims, net of reinsurance, in line with expectations.

Investment and Savings Products

Total product sales during the quarter were $2.9 billion, a 27% increase year-over-year.  The primary sales drivers were mutual funds and managed accounts, which increased 40% and 34%, respectively, while annuities were up slightly compared to last year’s strong first quarter results.  Net client inflows doubled from $543 million in the prior year period to $1.1 billion in the first quarter of 2021.  Client asset values ended the quarter at $85.9 billion, an increase of 45% year-over-year, reflecting the sharp market downturn in March 2020 and strong subsequent market performance combined with nearly $3 billion of net client inflows over the last 12 months.

Revenues of $223.4 million during the first quarter increased 21% compared to the same quarter in 2020, while pre-tax income of $63.4 million increased 33%.  Sales-based revenues increased 21%, slightly less than the 26% increase in revenue

generating sales as the mix of products sold continues to shift toward mutual funds which have a lower sales-based commission rate.  Asset-based revenues increased 24% year-over-year, in line with the increase in average client asset values.  Sales-based commission expenses were largely correlated with sales-based revenues, as were asset-based commission expenses when factoring in Canadian segregated fund commissions that are reflected in insurance commissions and DAC amortization.  Canadian segregated fund DAC amortization was lower year-over-year largely due to negative market performance during the first quarter of 2020.

Corporate and Other Distributed Products

During the first quarter of 2021, the segment recorded an operating loss before taxes of $24.3 million compared to $19.6 million in the prior year’s first quarter.  Segment revenues increased $2.7 million year-over-year.  Higher commissions and fees, including a $4.7 million increase from mortgage sales were offset by a $3.0 million reduction in net investment income due to lower portfolio yields and a higher allocation to the Term Life segment to support the growing block of business.  Sales commissions and other operating expenses increased $9.0 million due in part to $3.5 million in mortgage commissions and support costs as well as growth in technology costs and employee-related expenses.  Benefits and claims were lower year-over-year due to a $1.6 million loss associated with a reinsurance allowance on a discontinued line of business recognized in the prior year period.

Taxes

The effective tax rate remains relatively unchanged at 23.7% in the first quarter of 2021 compared to 23.4% in the first quarter of 2020.

Capital

As announced on April 19, the Company temporarily suspended its stock repurchase program to fund the planned acquisition of e-TeleQuote.  Consequently, there were no shares repurchased during the first quarter of 2021 and the Company does not plan any repurchase activity during the remainder of 2021.  Given the Company’s strong capital generation, repurchases are expected to resume in 2022.  The Board of Directors approved a dividend of $0.47 per share, payable on June 14, 2021, to stockholders of record on May 21, 2021.

Primerica has a strong balance sheet and continues to be well-capitalized to meet the future funding needs of both Primerica and e-TeleQuote’s businesses.  As of March 31, 2021, invested assets and cash at the holding company was $369.4 million, reflecting the liquidity build-up to fund the acquisition of e-TeleQuote.  The $100 million distribution from the Company’s Canadian subsidiary is expected to occur just prior to the closing of the e-TeleQuote transaction.   Primerica Life Insurance Company’s statutory risk-based capital (RBC) ratio was estimated to be approximately 400% at March 31, 2021.

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 Thursday, May 6, 2021 at 10:00 a.m. Eastern, to discuss the quarter’s results.  To access the webcast, go to https://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.  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 North America. Independent licensed representatives educate Primerica clients about how to better prepare for a more secure financial future by assessing their needs and providing appropriate solutions through term life insurance, which we underwrite, and mutual funds, annuities and other financial products, which we distribute primarily on behalf of third parties. We insured approximately 5.5 million lives and had over 2.6 million client investment accounts at December 31, 2020. Primerica, through its insurance company subsidiaries, was the #2 issuer of Term Life insurance coverage in North America in 2020. 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: Nicole.Russell@primerica.com

Media Contact:

Keith Hancock

470-564-6328

Email: Keith.Hancock@Primerica.com

PRIMERICA, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)
March 31, 2021 December 31, 2020
(In thousands)
Assets
Investments:
Fixed-maturity securities available-for-sale, at fair value $ 2,538,197 $ 2,464,611
Fixed-maturity security held-to-maturity, at amortized cost 1,362,210 1,346,350
Short-term investments available-for-sale, at fair value 50,758 -
Equity securities, at fair value 39,638 38,023
Trading securities, at fair value 35,046 16,300
Policy loans 30,278 30,199
Total investments 4,056,127 3,895,483
Cash and cash equivalents 439,944 547,569
Accrued investment income 19,964 17,618
Reinsurance recoverables 4,345,483 4,273,904
Deferred policy acquisition costs, net 2,712,169 2,629,644
Agent balances, due premiums and other receivables 268,660 259,448
Intangible assets 45,275 45,275
Income taxes 74,683 73,290
Operating lease right-of-use assets 45,318 46,567
Other assets 467,336 456,967
Separate account assets 2,638,901 2,659,520
Total assets $ 15,113,860 $ 14,905,285
Liabilities and Stockholders' Equity
Liabilities:
Future policy benefits $ 6,885,115 $ 6,790,557
Unearned and advance premiums 18,184 17,136
Policy claims and other benefits payable 526,654 519,711
Other policyholders' funds 475,511 447,765
Notes payable 374,511 374,415
Surplus note 1,361,648 1,345,772
Income taxes 235,234 223,496
Operating lease liabilities 51,521 52,806
Other liabilities 582,198 566,068
Payable under securities lending 87,190 72,154
Separate account liabilities 2,638,901 2,659,520
Total liabilities 13,236,667 13,069,400
Stockholders' equity:
Common stock 394 393
Paid-in capital 8,138 -
Retained earnings 1,785,038 1,705,786
Accumulated other comprehensive income (loss),<br><br><br>net of income tax 83,623 129,706
Total stockholders' equity 1,877,193 1,835,885
Total liabilities and stockholders' equity $ 15,113,860 $ 14,905,285
PRIMERICA, INC. AND SUBSIDIARIES
--- --- --- --- --- --- ---
Condensed Consolidated Statements of Income
(Unaudited)
Three months ended March 31,
2021 2020
(In thousands, except per-share amounts)
Revenues:
Direct premiums $ 762,227 $ 702,637
Ceded premiums (395,973 ) (386,825 )
Net premiums 366,254 315,812
Commissions and fees 234,044 190,069
Net investment income 20,052 15,420
Realized investment gains (losses) 1,766 (10,030 )
Other, net 15,595 13,665
Total revenues 637,711 524,936
Benefits and expenses:
Benefits and claims 183,789 134,813
Amortization of deferred policy acquisition costs 66,105 70,311
Sales commissions 121,894 96,607
Insurance expenses 48,766 48,709
Insurance commissions 8,740 6,844
Interest expense 7,145 7,192
Other operating expenses 72,963 65,914
Total benefits and expenses 509,402 430,390
Income before income taxes 128,309 94,546
Income taxes 30,437 22,077
Net income $ 97,872 $ 72,469
Earnings per share:
Basic earnings per share $ 2.47 $ 1.75
Diluted earnings per share $ 2.46 $ 1.75
Weighted-average shares used in computing<br><br><br>earnings per share:
Basic 39,456 41,131
Diluted 39,581 41,238
PRIMERICA, INC. AND SUBSIDIARIES
--- --- --- --- --- --- --- --- --- ---
Consolidated Adjusted Operating Results Reconciliation
(Unaudited – in thousands, except per share amounts)
Three months ended March 31,
2021 2020 % Change
Total revenues $ 637,711 $ 524,936 21 %
Less: Realized investment gains (losses) 1,766 (10,030 )
Less: 10% deposit asset MTM included in NII (793 ) (6,379 )
Adjusted operating revenues $ 636,738 $ 541,345 18 %
Income before income taxes $ 128,309 $ 94,546 36 %
Less: Realized investment gains (losses) 1,766 (10,030 )
Less: 10% deposit asset MTM included in NII (793 ) (6,379 )
Adjusted operating income before income taxes $ 127,336 $ 110,955 15 %
Net income $ 97,872 $ 72,469 35 %
Less: Realized investment gains (losses) 1,766 (10,030 )
Less: 10% deposit asset MTM included in NII (793 ) (6,379 )
Less: Tax impact of preceding items (231 ) 3,832
Adjusted net operating income $ 97,130 $ 85,046 14 %
Diluted earnings per share ^(1)^ $ 2.46 $ 1.75 41 %
Less: Net after-tax impact of operating adjustments 0.02 (0.30 )
Diluted adjusted operating earnings per share ^(1)^ $ 2.44 $ 2.05 19 %
^(1)^ Percentage change in earnings per share is calculated prior to rounding per share amounts.
--- ---
TERM LIFE INSURANCE SEGMENT
--- --- --- --- --- --- --- --- --- ---
Adjusted Premiums Reconciliation
(Unaudited – in thousands)
Three months ended March 31,
2021 2020 % Change
Direct premiums $ 756,514 $ 696,564 9 %
Less: Premiums ceded to IPO coinsurers 249,944 260,076
Adjusted direct premiums $ 506,570 $ 436,488 16 %
Ceded premiums $ (394,550 ) $ (385,232 )
Less: Premiums ceded to IPO coinsurers (249,944 ) (260,076 )
Other ceded premiums $ (144,606 ) $ (125,156 )
Net premiums $ 361,964 $ 311,332 16 %
CORPORATE AND OTHER DISTRIBUTED PRODUCTS SEGMENT
--- --- --- --- --- --- --- --- --- ---
Adjusted Operating Results Reconciliation
(Unaudited – in thousands)
Three months ended March 31,
2021 2020 % Change
Total revenues $ 32,262 $ 12,158 165 %
Less: Realized investment gains (losses) 1,766 (10,030 )
Less: 10% deposit asset MTM included in NII (793 ) (6,379 )
Adjusted operating revenues $ 31,289 $ 28,567 10 %
Loss before income taxes $ (23,290 ) $ (36,046 ) (35 )%
Less: Realized investment gains (losses) 1,766 (10,030 )
Less: 10% deposit asset MTM included in NII (793 ) (6,379 )
Adjusted operating loss before income taxes $ (24,263 ) $ (19,637 ) 24 %
PRIMERICA, INC. AND SUBSIDIARIES
--- --- --- --- --- --- --- ---
Adjusted Stockholders' Equity Reconciliation
(Unaudited – in thousands)
March 31, 2021 December 31, 2020 % Change
Stockholders' equity $ 1,877,193 $ 1,835,885 2 %
Less: Unrealized net investment gains (losses) recorded<br><br><br>in stockholders' equity, net of income tax 77,053 128,128
Adjusted stockholders' equity $ 1,800,140 $ 1,707,757 5 %

11

pri-ex992_6.htm

Exhibit 99.2

Supplemental Financial Information

First Quarter 2021

Table of Contents PRIMERICA, INC.<br><br><br>Financial Supplement
Page
--- ---
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, 2020.

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

First Quarter 2021

This document is a financial supplement to our first quarter 2021 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.

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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>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 Mar 31,<br><br><br>2021
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Condensed Balance Sheets
Assets:
Investments and cash excluding securities held to maturity $ 2,730,715 $ 2,626,043 $ 2,805,065 $ 2,861,883 $ 3,096,703 $ 3,133,860
Securities held to maturity 1,184,370 1,237,270 1,278,580 1,323,740 1,346,350 1,362,210
Total investments and cash 3,915,085 3,863,313 4,083,645 4,185,623 4,443,053 4,496,070
Due from reinsurers 4,169,823 4,132,897 4,217,129 4,229,088 4,273,904 4,345,483
Deferred policy acquisition costs 2,325,750 2,346,656 2,434,462 2,532,409 2,629,644 2,712,169
Other assets 792,128 799,122 851,660 885,083 899,164 921,235
Separate account assets 2,485,745 2,128,924 2,377,654 2,468,328 2,659,520 2,638,901
Total assets $ 13,688,531 $ 13,270,911 $ 13,964,549 $ 14,300,531 $ 14,905,285 $ 15,113,857
Liabilities:
Future policy benefits $ 6,446,569 $ 6,472,397 $ 6,567,169 $ 6,664,061 $ 6,790,557 $ 6,885,115
Other policy liabilities 744,087 737,435 855,083 911,454 984,612 1,020,349
Income taxes 209,221 208,357 265,369 216,639 223,496 235,233
Other liabilities 563,931 554,014 574,425 573,253 618,874 633,719
Notes payable 374,037 374,131 374,226 374,320 374,415 374,511
Surplus note 1,183,728 1,236,644 1,277,970 1,323,146 1,345,772 1,361,648
Payable under securities lending 28,723 28,896 29,973 48,883 72,154 87,190
Separate account liabilities 2,485,745 2,128,924 2,377,654 2,468,328 2,659,520 2,638,901
Total liabilities 12,036,040 11,740,797 12,321,869 12,580,085 13,069,400 13,236,665
Stockholders’ equity:
Common stock (0.01 par value) (1) 412 405 397 394 393 394
Paid-in capital (0 ) (0 ) (0 ) (0 ) (0 ) 8,138
Retained earnings 1,593,281 1,565,803 1,569,689 1,629,114 1,705,786 1,785,037
Treasury stock — — — — — —
Accumulated other comprehensive income (loss), net:
64,564 (1,318 ) 93,726 105,758 128,128 77,053
(5,765 ) (34,776 ) (21,132 ) (14,820 ) 1,578 6,570
Total stockholders’ equity 1,652,492 1,530,114 1,642,680 1,720,446 1,835,885 1,877,192
Total liabilities and stockholders' equity $ 13,688,531 $ 13,270,911 $ 13,964,549 $ 14,300,531 $ 14,905,285 $ 15,113,857
Reconciliation of Total Stockholders' Equity to Adjusted Stockholders' Equity
Total stockholders' equity $ 1,652,492 $ 1,530,114 $ 1,642,680 $ 1,720,446 $ 1,835,885 $ 1,877,192
Less: Net unrealized gains (losses) 64,564 (1,318 ) 93,726 105,758 128,128 77,053
Adjusted stockholders’ equity $ 1,587,928 $ 1,531,431 $ 1,548,954 $ 1,614,688 $ 1,707,757 $ 1,800,139
Adjusted Stockholders' Equity Rollforward
Balance, beginning of period $ 1,541,436 $ 1,587,928 $ 1,531,431 $ 1,548,954 $ 1,614,688 $ 1,707,757
Net Income 93,557 72,469 101,510 112,101 100,084 97,872
Shareholder dividends (14,162 ) (16,530 ) (16,083 ) (15,882 ) (15,851 ) (18,620 )
Retirement of shares and warrants (44,137 ) (95,676 ) (86,513 ) (41,556 ) (13,426 ) (5,966 )
Net foreign currency translation adjustment 6,500 (29,011 ) 13,645 6,312 16,398 4,992
Other, net 4,734 12,252 4,964 4,759 5,864 14,105
Balance, end of period $ 1,587,928 $ 1,531,431 $ 1,548,954 $ 1,614,688 $ 1,707,757 $ 1,800,139
Deferred Policy Acquisition Costs Rollforward
Balance, beginning of period $ 2,281,560 $ 2,325,750 $ 2,346,656 $ 2,434,462 $ 2,532,409 $ 2,629,644
General expenses deferred 8,608 9,726 9,205 9,702 9,510 10,558
Commission costs deferred 97,538 104,793 120,967 130,719 128,084 134,188
Amortization of deferred policy acquisition costs (67,279 ) (70,311 ) (53,177 ) (47,491 ) (53,342 ) (66,105 )
Foreign currency impact and other, net 5,322 (23,302 ) 10,812 5,017 12,984 3,884
Balance, end of period $ 2,325,750 $ 2,346,656 $ 2,434,462 $ 2,532,409 $ 2,629,644 $ 2,712,169

All values are in US Dollars.

(1) Outstanding common shares exclude restricted stock units.

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Financial Results and Other Statistical Data PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q1
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(Dollars in thousands, except per-share data) Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 /#<br>Change %<br><br><br>Change
Earnings per Share
Basic earnings per share:
Weighted-average common shares and fully vested equity awards 41,131,200 40,131,877 39,587,978 39,420,628 39,455,948 ) -4.1 %
Net income $ 72,469 $ 101,510 $ 112,101 $ 100,084 $ 97,872 35.1 %
Less income attributable to unvested participating securities (310 ) (437 ) (493 ) (433 ) (417 ) ) -34.3 %
Net income used in computing basic EPS $ 72,159 $ 101,073 $ 111,608 $ 99,651 $ 97,455 35.1 %
Basic earnings per share $ 1.75 $ 2.52 $ 2.82 $ 2.53 $ 2.47 40.8 %
Adjusted net operating income $ 85,047 $ 98,480 $ 110,718 $ 97,339 $ 97,129 14.2 %
Less operating income attributable to unvested participating securities (364 ) (424 ) (487 ) (421 ) (414 ) ) -13.6 %
Adjusted net operating income used in computing basic operating EPS $ 84,682 $ 98,056 $ 110,231 $ 96,918 $ 96,715 14.2 %
Basic adjusted operating income per share $ 2.06 $ 2.44 $ 2.78 $ 2.46 $ 2.45 19.1 %
Diluted earnings per share:
Weighted-average common shares and fully vested equity awards 41,131,200 40,131,877 39,587,978 39,420,628 39,455,948 ) -4.1 %
Dilutive impact of contingently issuable shares 107,361 114,090 122,097 133,544 124,505 16.0 %
Shares used to calculate diluted EPS 41,238,561 40,245,967 39,710,075 39,554,172 39,580,453 ) -4.0 %
Net income $ 72,469 $ 101,510 $ 112,101 $ 100,084 $ 97,872 35.1 %
Less income attributable to unvested participating securities (310 ) (436 ) (492 ) (431 ) (416 ) ) -34.2 %
Net income used in computing diluted EPS $ 72,159 $ 101,074 $ 111,609 $ 99,652 $ 97,456 35.1 %
Diluted earnings per share $ 1.75 $ 2.51 $ 2.81 $ 2.52 $ 2.46 40.7 %
Adjusted net operating income $ 85,047 $ 98,480 $ 110,718 $ 97,339 $ 97,129 14.2 %
Less operating income attributable to unvested participating securities (364 ) (423 ) (486 ) (420 ) (413 ) ) -13.5 %
Adjusted net operating income used in computing diluted operating EPS $ 84,683 $ 98,057 $ 110,232 $ 96,919 $ 96,717 14.2 %
Diluted adjusted operating income per share $ 2.05 $ 2.44 $ 2.78 $ 2.45 $ 2.44 19.0 %

All values are in US Dollars.

YOY Q1
Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 /#<br>Change %<br><br><br>Change
Annualized Return on Equity
Average stockholders' equity $ 1,591,303 $ 1,586,397 $ 1,681,563 $ 1,778,166 $ 1,856,539 16.7 %
Average adjusted stockholders' equity $ 1,559,680 $ 1,540,193 $ 1,581,821 $ 1,661,222 $ 1,753,948 12.5 %
Net income return on stockholders' equity 18.2 % 25.6 % 26.7 % 22.5 % 21.1 % % nm
Net income return on adjusted stockholders' equity 18.6 % 26.4 % 28.3 % 24.1 % 22.3 % % nm
Adjusted net operating income return on adjusted stockholders' equity 21.8 % 25.6 % 28.0 % 23.4 % 22.2 % % nm
Capital Structure
Debt-to-capital (1) 19.6 % 18.6 % 17.9 % 16.9 % 16.6 % % nm
Debt-to-capital, excluding AOCI (1) 19.3 % 19.2 % 18.7 % 18.0 % 17.3 % % nm
Cash and invested assets to stockholders' equity 2.5 x 2.5 x 2.4 x 2.4 x 2.4 x x) nm
Cash and invested assets to adjusted stockholders' equity 2.5 x 2.6 x 2.6 x 2.6 x 2.5 x x) nm
Share count, end of period (2) 40,459,767 39,667,002 39,374,259 39,305,902 39,414,085 ) -2.6 %
Adjusted stockholders' equity per share $ 37.85 $ 39.05 $ 41.01 $ 43.45 $ 45.67 20.7 %
Financial Strength Ratings - Primerica Life Insurance Co
Moody's A1 A1 A1 A1 A1 nm nm
S&P AA- AA- AA- AA- AA- nm nm
A.M. Best A+ A+ A+ A+ A+ nm nm
Holding Company Senior Debt Ratings
Moody's Baa1 Baa1 Baa1 Baa1 Baa1 nm nm
S&P A- A- A- A- A- nm nm
A.M. Best a- a- a- a- a- 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 Q1
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(Dollars in thousands) Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 Change %<br><br><br>Change
Statement of Income
Revenues:
Direct premiums $ 702,637 $ 717,088 $ 736,606 $ 750,818 $ 762,227 8.5 %
Ceded premiums (386,825 ) (402,549 ) (393,716 ) (397,676 ) (395,973 ) ) -2.4 %
Net premiums 315,813 314,539 342,890 353,142 366,254 16.0 %
Net investment income 15,420 22,710 22,953 22,731 20,052 30.0 %
Commissions and fees:
Sales-based (1) 80,891 62,812 65,600 75,347 98,112 21.3 %
Asset-based (2) 81,395 78,146 86,695 93,669 101,241 24.4 %
Account-based (3) 20,204 20,478 21,008 21,351 21,120 4.5 %
Other commissions and fees 7,579 10,352 11,999 13,746 13,571 79.1 %
Realized investment (losses) gains (10,030 ) 1,742 642 2,650 1,766 117.6 %
Other, net 13,665 15,036 16,674 15,695 15,595 14.1 %
Total revenues 524,936 525,815 568,460 598,330 637,711 21.5 %
Benefits and expenses:
Benefits and claims 134,813 139,646 160,166 180,945 183,789 36.3 %
Amortization of DAC 70,311 53,177 47,491 53,342 66,105 ) -6.0 %
Insurance commissions 6,844 6,333 9,694 9,263 8,740 27.7 %
Insurance expenses 48,709 43,753 46,109 49,546 48,766 0.1 %
Sales commissions:
Sales-based (1) 56,561 44,834 46,821 52,931 68,594 21.3 %
Asset-based (2) 36,323 35,673 39,349 43,227 46,866 29.0 %
Other sales commissions 3,723 4,985 5,779 6,430 6,434 72.8 %
Interest expense 7,192 7,200 7,221 7,225 7,145 ) -0.7 %
Other operating expenses 65,914 56,152 59,348 63,781 72,964 10.7 %
Total benefits and expenses 430,391 391,753 421,978 466,690 509,403 18.4 %
Income before income taxes 94,546 134,062 146,482 131,640 128,308 35.7 %
Income taxes 22,077 32,552 34,382 31,556 30,437 37.9 %
Net income $ 72,469 $ 101,510 $ 112,101 $ 100,084 $ 97,872 35.1 %
Income Before Income Taxes by Segment
Term Life $ 82,892 $ 94,903 $ 105,316 $ 89,440 $ 88,236 6.4 %
Investment & Savings Products 47,700 46,859 51,372 56,713 63,363 32.8 %
Corporate & Other Distributed Products (36,046 ) (7,700 ) (10,206 ) (14,514 ) (23,290 ) 35.4 %
Income before income taxes $ 94,546 $ 134,062 $ 146,482 $ 131,640 $ 128,308 35.7 %

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 Q1
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(Dollars in thousands) Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 Change %<br><br><br>Change
Reconciliation from Term Life Direct Premiums to Term Life Adjusted Direct Premiums
Term Life direct premiums $ 696,564 $ 711,188 $ 730,273 $ 745,559 $ 756,514 8.6 %
Less: Premiums ceded to IPO Coinsurers 260,076 257,529 254,938 253,039 249,944 ) -3.9 %
Term Life adjusted direct premiums $ 436,488 $ 453,659 $ 475,335 $ 492,520 $ 506,570 16.1 %
Reconciliation from Term Life Ceded Premiums to Term Life Other Ceded Premiums
Term Life ceded premiums $ (385,232 ) $ (400,919 ) $ (392,004 ) $ (395,767 ) $ (394,550 ) ) -2.4 %
Less: Premiums ceded to IPO Coinsurers (260,076 ) (257,529 ) (254,938 ) (253,039 ) (249,944 ) 3.9 %
Term Life other ceded premiums $ (125,156 ) $ (143,390 ) $ (137,066 ) $ (142,728 ) $ (144,606 ) ) -15.5 %
Reconciliation from Net Investment Income to Adjusted Net Investment Income
Net Investment Income $ 15,420 $ 22,710 $ 22,953 $ 22,731 $ 20,052 30.0 %
Less: MTM investment adjustments (6,379 ) 2,259 1,165 960 (793 ) nm nm
Adjusted net investment income $ 21,799 $ 20,451 $ 21,788 $ 21,771 $ 20,845 ) -4.4 %
Reconciliation from Total Revenues to Adjusted Operating Revenues
Total revenues $ 524,936 $ 525,815 $ 568,460 $ 598,330 $ 637,711 21.5 %
Less: Realized investment gains/(losses) (10,030 ) 1,742 642 2,650 1,766 nm nm
Less: MTM investment adjustments (6,379 ) 2,259 1,165 960 (793 ) nm nm
Adjusted operating revenues $ 541,346 $ 521,813 $ 566,653 $ 594,720 $ 636,738 17.6 %
Reconciliation from Income Before Income Taxes to Adjusted Operating Income Before Income Taxes
Income before income taxes $ 94,546 $ 134,062 $ 146,482 $ 131,640 $ 128,308 35.7 %
Less: Realized investment gains/(losses) (10,030 ) 1,742 642 2,650 1,766 nm nm
Less: MTM investment adjustments (6,379 ) 2,259 1,165 960 (793 ) nm nm
Adjusted operating income before income taxes $ 110,955 $ 130,060 $ 144,676 $ 128,030 $ 127,335 14.8 %
Reconciliation from Net Income to Adjusted Net Operating Income
Net income $ 72,469 $ 101,510 $ 112,101 $ 100,084 $ 97,872 35.1 %
Less: Income before income taxes reconciling items (16,409 ) 4,002 1,807 3,610 973 nm nm
Less: Tax impact of income before income taxes reconciling items 3,832 (972 ) (424 ) (865 ) (231 ) nm nm
Adjusted net operating income $ 85,047 $ 98,480 $ 110,718 $ 97,339 $ 97,129 14.2 %

All values are in US Dollars.

7 of 16

Segment Operating Results PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q1
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(Dollars in thousands) Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 Change %<br><br><br>Change
Term Life Insurance
Revenues:
Direct Premiums $ 696,564 $ 711,188 $ 730,273 $ 745,559 $ 756,514 8.6 %
Premiums ceded to IPO coinsurers (1) (260,076 ) (257,529 ) (254,938 ) (253,039 ) (249,944 ) 3.9 %
Adjusted direct premiums (2) 436,488 453,659 475,335 492,520 506,570 16.1 %
Other ceded premiums (3) (125,156 ) (143,390 ) (137,066 ) (142,728 ) (144,606 ) ) -15.5 %
Net premiums 311,332 310,269 338,269 349,792 361,964 16.3 %
Allocated net investment income 6,246 6,538 6,813 7,432 8,253 32.1 %
Other, net 10,168 11,426 12,717 11,768 11,810 16.1 %
Revenues 327,747 328,233 357,799 368,992 382,028 16.6 %
Benefits and expenses:
Benefits and claims 128,563 135,409 156,209 173,767 178,963 39.2 %
Amortization of DAC 65,840 52,730 45,529 52,109 62,584 ) -4.9 %
Insurance commissions 3,286 2,884 5,946 5,477 4,869 48.2 %
Insurance expenses 47,165 42,306 44,800 48,199 47,375 0.4 %
Benefits and expenses 244,855 233,330 252,483 279,551 293,792 20.0 %
Income before income taxes $ 82,892 $ 94,903 $ 105,316 $ 89,440 $ 88,236 6.4 %
Investment & Savings Products
Revenues:
Commissions and fees:
Sales-based $ 80,891 $ 62,812 $ 65,600 $ 75,347 $ 98,112 21.3 %
Asset-based 81,395 78,146 86,695 93,669 101,241 24.4 %
Account-based 20,204 20,478 21,008 21,351 21,120 4.5 %
Other, net 2,542 2,745 3,034 2,949 2,949 16.0 %
Revenues 185,033 164,180 176,338 193,316 223,422 20.7 %
Benefits and expenses:
Amortization of DAC 4,305 100 1,667 982 3,275 ) -23.9 %
Insurance commissions 3,201 3,106 3,377 3,500 3,572 11.6 %
Sales commissions:
Sales-based 56,561 44,834 46,821 52,931 68,594 21.3 %
Asset-based 36,323 35,673 39,349 43,227 46,866 29.0 %
Other operating expenses 36,942 33,608 33,751 35,963 37,752 2.2 %
Benefits and expenses 137,332 117,321 124,966 136,603 160,060 16.5 %
Income before income taxes $ 47,700 $ 46,859 $ 51,372 $ 56,713 $ 63,363 32.8 %
Corporate & Other Distributed Products
Revenues:
Direct premiums $ 6,074 $ 5,900 $ 6,333 $ 5,259 $ 5,713 ) -5.9 %
Ceded premiums (1,593 ) (1,631 ) (1,712 ) (1,909 ) (1,423 ) 10.7 %
Net premiums 4,480 4,270 4,621 3,350 4,290 ) -4.3 %
Allocated net investment income 15,553 13,913 14,975 14,339 12,592 ) -19.0 %
Commissions and fees:
Prepaid Legal Services 3,829 4,557 4,942 5,104 4,783 24.9 %
Auto and Homeowners Insurance 1,672 2,263 1,985 2,194 1,787 6.8 %
Mortgage loans 264 1,301 3,011 4,146 4,960 nm
Other sales commissions 1,813 2,231 2,061 2,301 2,041 12.6 %
Other, net 954 865 922 977 836 ) -12.5 %
Adjusted operating revenues 28,566 29,400 32,516 32,412 31,288 9.5 %
Benefits and expenses:
Benefits and claims 6,249 4,236 3,957 7,178 4,826 ) -22.8 %
Amortization of DAC 166 346 295 251 246 48.0 %
Insurance commissions 357 343 371 286 299 ) -16.4 %
Insurance expenses 1,544 1,447 1,309 1,347 1,391 ) -9.9 %
Sales commissions 3,723 4,985 5,779 6,430 6,434 72.8 %
Interest expense 7,192 7,200 7,221 7,225 7,145 ) -0.7 %
Other operating expenses 28,972 22,544 25,597 27,818 35,211 21.5 %
Benefits and expenses 48,203 41,102 44,529 50,535 55,551 15.2 %
Adjusted operating income before income taxes $ (19,637 ) $ (11,702 ) $ (12,013 ) $ (18,124 ) $ (24,263 ) ) -23.6 %

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.
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(3) Other ceded premiums - premiums ceded to non-IPO coinsurers net of any applicable reimbursements from the IPO coinsurers.
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8 of 16

Term Life Insurance - Financial Results and Analysis PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q1
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(Dollars in thousands) Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 Change %<br><br><br>Change
Term Life Insurance Income Before Income Taxes
Revenues:
Direct Premiums $ 696,564 $ 711,188 $ 730,273 $ 745,559 $ 756,514 8.6 %
Premiums ceded to IPO coinsurers (1) (260,076 ) (257,529 ) (254,938 ) (253,039 ) (249,944 ) 3.9 %
Adjusted direct premiums (2) 436,488 453,659 475,335 492,520 506,570 16.1 %
Other ceded premiums (3) (125,156 ) (143,390 ) (137,066 ) (142,728 ) (144,606 ) ) -15.5 %
Net premiums 311,332 310,269 338,269 349,792 361,964 16.3 %
Allocated net investment income 6,246 6,538 6,813 7,432 8,253 32.1 %
Other, net 10,168 11,426 12,717 11,768 11,810 16.1 %
Revenues 327,747 328,233 357,799 368,992 382,028 16.6 %
Benefits and expenses:
Benefits and claims 128,563 135,409 156,209 173,767 178,963 39.2 %
Amortization of DAC 65,840 52,730 45,529 52,109 62,584 ) -4.9 %
Insurance commissions 3,286 2,884 5,946 5,477 4,869 48.2 %
Insurance expenses 47,165 42,306 44,800 48,199 47,375 0.4 %
Benefits and expenses 244,855 233,330 252,483 279,551 293,792 20.0 %
Income before income taxes $ 82,892 $ 94,903 $ 105,316 $ 89,440 $ 88,236 6.4 %
Total Term Life Insurance - Financial Analysis
Post-IPO direct premiums (4) $ 336,921 $ 352,353 $ 372,852 $ 388,303 $ 401,106 19.1 %
Pre-IPO direct premiums (5) 359,643 358,835 357,421 357,256 355,408 ) -1.2 %
Total direct premiums $ 696,564 $ 711,188 $ 730,273 $ 745,559 $ 756,514 8.6 %
Premiums ceded to IPO coinsurers $ 260,076 $ 257,529 $ 254,938 $ 253,039 $ 249,944 ) -3.9 %
% of Pre-IPO direct premiums 72.3 % 71.8 % 71.3 % 70.8 % 70.3 % nm nm
Benefits and claims, net (6) $ 253,719 $ 278,799 $ 293,275 $ 316,495 $ 323,569 27.5 %
% of adjusted direct premiums 58.1 % 61.5 % 61.7 % 64.3 % 63.9 % nm nm
DAC amortization & insurance commissions $ 69,126 $ 55,614 $ 51,474 $ 57,585 $ 67,454 ) -2.4 %
% of adjusted direct premiums 15.8 % 12.3 % 10.8 % 11.7 % 13.3 % nm nm
Insurance expenses, net (7) $ 36,997 $ 30,881 $ 32,083 $ 36,431 $ 35,565 ) -3.9 %
% of adjusted direct premiums 8.5 % 6.8 % 6.7 % 7.4 % 7.0 % nm nm
Total Term Life income before income taxes $ 82,892 $ 94,903 $ 105,316 $ 89,440 $ 88,236 6.4 %
Term Life operating margin (8) 19.0 % 20.9 % 22.2 % 18.2 % 17.4 % 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.
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9 of 16

Term Life Insurance - Key Statistics PRIMERICA, INC.<br><br><br>Financial Supplement
YOY Q1
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands, except as noted) Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 /#<br>Change %<br><br><br>Change
Key Statistics
Life-insurance licensed sales force, beginning of period 130,522 130,095 134,157 136,306 134,907 3.4 %
10,599 12,250 13,138 12,119 10,833 2.2 %
(11,026 ) (8,188 ) (10,989 ) (13,518 ) (13,710 ) ) -24.3 %
Life-insurance licensed sales force, end of period 130,095 134,157 136,306 134,907 132,030 1.5 %
Estimated annualized issued term life premium (mills) (1):
$ 61.5 $ 77.7 $ 86.0 $ 78.4 $ 74.5 21.1 %
15.0 17.8 17.9 18.1 18.0 20.1 %
Total estimated annualized issued term life premium $ 76.5 $ 95.5 $ 103.9 $ 96.5 $ 92.5 20.9 %
Issued term life policies 71,318 94,044 100,199 87,307 82,667 15.9 %
Estimated average annualized issued term life premium per policy (1)(2) $ 863 $ 826 $ 858 $ 898 $ 901 4.5 %
Term life face amount in-force, beginning of period (mills) $ 808,262 $ 804,512 $ 821,998 $ 840,227 $ 858,818 6.3 %
23,221 27,754 30,104 28,357 26,643 14.7 %
(18,294 ) (14,315 ) (13,733 ) (14,506 ) (17,240 ) 5.8 %
(8,676 ) 4,046 1,859 4,740 1,422 116.4 %
Term life face amount in-force, end of period $ 804,512 $ 821,998 $ 840,227 $ 858,818 $ 869,643 8.1 %

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 Q1
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands, except as noted) Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 Change %<br><br><br>Change
Investment & Savings Products Income Before Income Taxes
Revenues:
Commissions and fees:
Sales-based $ 80,891 $ 62,812 $ 65,600 $ 75,347 $ 98,112 21.3 %
Asset-based 81,395 78,146 86,695 93,669 101,241 24.4 %
Account-based 20,204 20,478 21,008 21,351 21,120 4.5 %
Other, net 2,542 2,745 3,034 2,949 2,949 16.0 %
Revenues 185,033 164,180 176,338 193,316 223,422 20.7 %
Benefits and expenses:
Amortization of DAC 4,305 100 1,667 982 3,275 ) -23.9 %
Insurance commissions 3,201 3,106 3,377 3,500 3,572 11.6 %
Sales commissions:
Sales-based 56,561 44,834 46,821 52,931 68,594 21.3 %
Asset-based 36,323 35,673 39,349 43,227 46,866 29.0 %
Other operating expenses 36,942 33,608 33,751 35,963 37,752 2.2 %
Benefits and expenses 137,332 117,321 124,966 136,603 160,060 16.5 %
Income before income taxes $ 47,700 $ 46,859 $ 51,372 $ 56,713 $ 63,363 32.8 %
Financial Analysis
Fees paid based on client asset values (1) $ 5,990 $ 5,712 $ 6,284 $ 6,772 $ 6,964 16.3 %
Fees paid based on fee-generating positions (2) 10,248 9,094 8,747 9,547 10,451 2.0 %
Other operating expenses 20,704 18,803 18,719 19,644 20,337 ) -1.8 %
Total other operating expenses $ 36,942 $ 33,608 $ 33,751 $ 35,963 $ 37,752 2.2 %
Sales-based net revenue as % of revenue-generating sales (3)
U.S. 1.34 % 1.33 % 1.27 % 1.31 % 1.29 % nm nm
Canada 1.06 % 0.87 % 0.93 % 0.95 % 1.05 % nm nm
Total 1.30 % 1.27 % 1.23 % 1.26 % 1.25 % nm nm
Asset-based net revenue as % of average asset values (4)
U.S. 0.038 % 0.037 % 0.038 % 0.038 % 0.039 % nm nm
Canada 0.098 % 0.133 % 0.119 % 0.124 % 0.103 % nm nm
Total 0.047 % 0.052 % 0.050 % 0.052 % 0.049 % nm nm
Account-based net revenue per average fee generating position (5)(6) $ 3.70 $ 4.19 $ 4.45 $ 4.23 $ 3.77 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.
--- ---
(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 Q1
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands, except as noted) Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 /#<br>Change %<br><br><br>Change
Key Statistics
Product sales (mills)
$ 921.0 $ 758.4 $ 874.1 $ 945.5 $ 1,261.9 37.0 %
280.9 165.2 189.6 256.0 424.0 51.0 %
72.2 48.4 47.2 50.6 55.5 ) -23.2 %
600.6 440.5 421.7 529.3 627.1 4.4 %
Total sales-based revenue generating product sales 1,874.7 1,412.5 1,532.6 1,781.3 2,368.4 26.3 %
246.2 200.1 223.0 230.7 330.1 34.0 %
124.8 73.9 85.3 57.3 154.9 24.2 %
Total product sales $ 2,245.7 $ 1,686.5 $ 1,841.0 $ 2,069.4 $ 2,853.5 27.1 %
$ 280.9 $ 165.2 $ 189.6 $ 256.0 $ 424.0 51.0 %
124.8 73.9 85.3 57.3 154.9 24.2 %
Total Canada product sales 405.7 239.2 274.9 313.3 579.0 42.7 %
Total U.S. product sales 1,840.0 1,447.3 1,566.1 1,756.1 2,274.5 23.6 %
Total product sales $ 2,245.7 $ 1,686.5 $ 1,841.0 $ 2,069.4 $ 2,853.5 27.1 %
Client asset values, beginning of period (mills) $ 70,537 $ 59,036 $ 68,224 $ 72,606 $ 81,533 15.6 %
2,246 1,686 1,841 2,069 2,853 27.1 %
(1,703 ) (1,074 ) (1,333 ) (1,427 ) (1,759 ) ) -3.3 %
Net flows 543 613 508 642 1,095 101.8 %
(978 ) 404 205 539 172 117.6 %
(11,065 ) 8,171 3,669 7,745 3,088 127.9 %
Client asset values, end of period $ 59,036 $ 68,224 $ 72,606 $ 81,533 $ 85,888 45.5 %
3.1 % 4.2 % 3.0 % 3.5 % 5.4 % % nm
Average client asset values (mills)
$ 32,693 $ 31,586 $ 35,204 $ 37,562 $ 41,161 25.9 %
7,950 7,573 8,525 9,186 10,268 29.2 %
3,905 3,871 4,325 4,703 5,295 35.6 %
2,389 2,427 2,446 2,469 2,495 4.4 %
17,292 16,890 18,551 19,634 21,291 23.1 %
2,366 2,291 2,461 2,536 2,622 10.8 %
Total $ 66,595 $ 64,638 $ 71,512 $ 76,090 $ 83,131 24.8 %
$ 7,950 $ 7,573 $ 8,525 $ 9,186 $ 10,268 29.2 %
2,366 2,291 2,461 2,536 2,622 10.8 %
Total Canada average client assets 10,316 9,864 10,986 11,722 12,890 25.0 %
Total U.S. average client assets 56,279 54,775 60,526 64,368 70,241 24.8 %
Total average client assets $ 66,595 $ 64,638 $ 71,512 $ 76,090 $ 83,131 24.8 %
Average number of fee-generating positions (thous) (3)
2,031 2,048 2,072 2,091 2,115 4.2 %
658 671 685 697 714 8.5 %
Total 2,689 2,718 2,757 2,788 2,830 5.2 %

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 March 31, 2021
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
% 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 $ 490,701 $ 490,701 $ - 15.8 % 16.3 %
Fixed Income:
Treasury 24,441 23,717 724 0.8 % 0.8 % 1.99 % AAA
Government 286,810 278,396 8,413 9.2 % 9.3 % 2.89 % AA-
Tax-Exempt Municipal 47,284 45,203 2,081 1.5 % 1.5 % 2.77 % AA
Public Corporate 1,537,715 1,470,958 66,757 49.6 % 49.0 % 3.45 % BBB+
Mortgage Backed 275,340 266,112 9,228 8.9 % 8.9 % 2.64 % AAA
Asset Backed 70,698 69,772 926 2.3 % 2.3 % 3.09 % AA-
CMBS 144,265 140,293 3,972 4.7 % 4.7 % 2.99 % AA
Private Placements 180,880 175,328 5,552 5.8 % 5.8 % 4.29 % BBB
Redeemable Preferred 5,810 5,447 362 0.2 % 0.2 % 5.47 % BBB
Total Fixed Income 2,573,242 2,475,227 98,016 83.0 % 82.4 % 3.30 % A-
Equities and Other:
Perpetual Preferred 13,397 13,397 - 0.4 % 0.4 %
Common Stock 18,221 18,221 0 0.6 % 0.6 %
Mutual Fund 6,090 6,090 - 0.2 % 0.2 %
Derivatives 40 40 - 0.0 % 0.0 %
Other - - - 0.0 % 0.0 %
Total Equities 37,748 37,748 0 1.2 % 1.3 %
Total Invested Assets $ 3,101,690 $ 3,003,675 $ 98,016 100.0 % 100.0 %
Public Corporate Portfolio by Sector
Consumer Non Cyclical $ 198,765 $ 191,382 $ 7,383 12.9 % 13.0 %
Energy 156,954 149,229 7,724 10.2 % 10.1 %
Insurance 153,627 147,253 6,373 10.0 % 10.0 %
Banking 137,828 132,202 5,626 9.0 % 9.0 %
REITs 136,620 129,624 6,996 8.9 % 8.8 %
Consumer Cyclical 124,079 119,031 5,048 8.1 % 8.1 %
Technology 118,291 112,238 6,053 7.7 % 7.6 %
Electric 100,803 97,085 3,718 6.6 % 6.6 %
Capital Goods 86,646 83,791 2,855 5.6 % 5.7 %
Transportation 74,695 72,265 2,429 4.9 % 4.9 %
Basic Industry 72,200 69,098 3,102 4.7 % 4.7 %
Communications 69,132 64,567 4,564 4.5 % 4.4 %
Brokerage 53,050 50,049 3,001 3.4 % 3.4 %
Finance Companies 28,801 27,698 1,103 1.9 % 1.9 %
Financial Other 8,543 8,332 211 0.6 % 0.6 %
Industrial Other 8,013 7,655 358 0.5 % 0.5 %
Natural Gas 6,356 6,134 222 0.4 % 0.4 %
Owned No Guarantee 2,229 2,325 (96 ) 0.1 % 0.2 %
Utility Other 1,085 999 86 0.1 % 0.1 %
Total Corporate portfolio $ 1,537,715 $ 1,470,958 $ 66,757 100.0 % 100.0 %
Fixed-Maturity Securities - Effective Maturity
Effective maturity
< 1 Yr. $ 260,841 $ 257,562 $ 3,278 10.1 % 10.4 % 2.90 %
1-2 Yrs. 337,399 325,226 12,173 13.1 % 13.1 % 3.33 %
2-5 Yrs. 855,681 803,997 51,684 33.3 % 32.5 % 3.54 %
5-10 Yrs. 829,658 803,663 25,996 32.2 % 32.5 % 3.14 %
> 10 Yrs. 289,663 284,779 4,884 11.3 % 11.5 % 3.41 %
Total Fixed Income $ 2,573,242 $ 2,475,227 $ 98,016 100.0 % 100.0 % 3.30 %
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 March 31, 2021 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 $ 411,644 16.6 %
AA 301,291 12.2 %
A 569,388 23.0 %
BBB 1,089,736 44.0 %
Below Investment Grade 100,633 4.1 %
NA 2,536 0.1 %
Total Fixed Income $ 2,475,227 100.0 %
Amortized  Cost % of Total Amortized  Cost % of Total
Public Corporate asset class: Private Placement asset class:
Rating Rating
AAA $ 12,175 0.8 % AAA $ - —
AA 77,080 5.2 % AA 5,558 3.2 %
A 368,039 25.0 % A 21,352 12.2 %
BBB 932,102 63.4 % BBB 132,196 75.4 %
Below Investment Grade 80,614 5.5 % Below Investment Grade 16,222 9.3 %
NA 949 0.1 % NA - —
Total Corporate $ 1,470,958 100.0 % Total Private $ 175,328 100.0 %
CMBS asset class: Mortgage-Backed asset class:
Rating Rating
AAA $ 81,734 58.3 % AAA $ 231,538 87.0 %
AA 2,958 2.1 % AA 25,029 9.4 %
A 55,528 39.6 % A 9,374 3.5 %
BBB - — BBB - —
Below Investment Grade 74 0.1 % Below Investment Grade 135 0.1 %
NA - — NA 35 0.0 %
Total CMBS $ 140,293 100.0 % Total Mortgage-Backed $ 266,112 100.0 %
Asset-Backed asset class: Treasury & Government asset classes:
Rating Rating
AAA $ 24,190 34.7 % AAA $ 58,508 19.4 %
AA 4,008 5.7 % AA 153,653 50.9 %
A 35,104 50.3 % A 74,737 24.7 %
BBB 4,229 6.1 % BBB 12,319 4.1 %
Below Investment Grade 691 1.0 % Below Investment Grade 2,897 1.0 %
NA 1,551 2.2 % NA 0 0.0 %
Total Asset-Backed $ 69,772 100.0 % Total Treasury & Government $ 302,113 100.0 %
NAIC Designations
1 $ 1,009,063 48.2 %
2 979,392 46.8 %
3 88,436 4.2 %
4 16,037 0.8 %
5 - —
6 0 0.0 %
U.S. Insurer Fixed Income (2) 2,092,928 100.0 %
Other (3) 420,046
Cash and cash equivalents 490,702
Total Invested Assets $ 3,003,676
(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 Q1
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(Dollars in thousands) Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 Change %<br><br><br>Change
Net Investment Income by Source
Fixed-maturity securities (available-for-sale) $ 20,784 $ 20,213 $ 20,882 $ 20,925 $ 20,020 ) -3.7%
Fixed-maturity securities (held-to-maturity) 13,472 14,074 14,704 15,223 15,146 12.4%
Equity Securities 451 461 433 406 391 ) -13.2%
Deposit asset underlying 10% reinsurance treaty 1,830 1,394 1,694 1,330 1,368 ) -25.3%
Deposit asset - Mark to Market (6,379 ) 2,259 1,165 960 (793 ) -87.6%
Policy loans and other invested assets 189 541 242 272 231 22.4%
Cash & cash equivalents 843 143 114 103 119 ) -85.9%
Total investment income 31,190 39,085 39,234 39,219 36,483 17.0%
Investment expenses 2,298 2,300 1,577 1,265 1,284 ) -44.1%
Interest Expense on Surplus Note 13,472 14,074 14,704 15,223 15,146 12.4%
Net investment income $ 15,420 $ 22,710 $ 22,953 $ 22,731 $ 20,052 30.0%
Fixed income book yield, end of period 3.55 % 3.54 % 3.45 % 3.44 % 3.30 %
New money yield 3.25 % 3.14 % 2.44 % 2.67 % 1.72 %
YOY Q1
Q1<br><br><br>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021 % Pt<br>Change
Fixed Income Portfolio Quality Ratings
Rating
AAA 22.9 % 21.5 % 19.6 % 18.7 % 16.6 % %
AA 12.1 % 11.6 % 12.8 % 12.7 % 12.2 % %
A 22.9 % 22.3 % 21.8 % 22.3 % 23.0 % %
BBB 38.9 % 40.4 % 42.0 % 42.3 % 44.0 % %
Below Investment Grade 3.1 % 4.0 % 3.8 % 3.9 % 4.1 % %
NA 0.1 % 0.1 % 0.1 % 0.1 % 0.1 % %
Total Fixed Income 100.0 % 100.0 % 100.0 % 100.0 % 100.0 %
Average rating by amortized cost A A A A A-

All values are in US Dollars.

As of March 31, 2021 As of March 31, 2021 As of March 31, 2021
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 $ 21,618 $ 21,066 AAA Canada $ 78,229 $ 73,282 AAA $ 2,023 $ 2,001
2 Province of Ontario Canada 19,564 19,703 A+ Australia 34,183 32,478 AA 9,977 9,626
3 Province of Alberta Canada 14,351 14,212 AA- United Kingdom 31,645 30,177 A 9,758 9,387
4 Morgan Stanley 14,141 13,626 A+ France 13,053 12,561 BBB 10,828 10,328
5 Province of Quebec Canada 12,473 11,490 AA- Germany 12,345 12,113 Below Investment Grade 2,947 2,897
6 Enbridge Inc 12,049 11,685 BBB+ Ireland 12,101 11,888 NA — —
7 ConocoPhillips 12,043 11,055 A- Bermuda 11,280 10,541 Total $ 35,533 $ 34,238
8 Province of New Brunswick Canada 11,872 11,778 A+ Cayman Islands 11,144 11,050
9 Province of Manitoba Canada 11,556 11,422 A+ Japan 10,869 10,362
10 Province of British Columbia Canada 11,068 10,711 AAA Mexico 9,358 9,384 Non-Government Investments (1)
11 Capital One Financial Corp 10,352 9,902 BBB Switzerland 9,078 7,943
12 General Motors Co 10,069 9,275 BBB Netherlands 8,853 8,681 AAA $ 3,956 $ 3,934
13 City of Toronto Canada 9,600 9,145 AA Norway 5,067 4,958 AA 11,972 11,853
14 Wells Fargo & Co 9,429 9,184 A- Brazil 4,650 4,606 A 60,145 57,400
15 Municipal Finance Authority of British Columbia 9,335 8,985 AAA Israel 4,015 3,983 BBB 163,263 154,290
16 AbbVie Inc 8,924 8,722 BBB+ Emerging Markets  (2) 15,141 14,744 Below Investment Grade 18,482 17,832
17 Entergy Corp 8,521 8,464 BBB+ All Other 22,340 20,796 NA — —
18 Brookfield Asset Management Inc 8,263 7,486 A- Total $ 293,351 $ 279,547 Total $ 257,819 $ 245,309
19 Province of Newfoundland and Labrador 8,164 7,748 A
20 TC Energy Corp 8,092 7,642 BBB+
21 Truist Financial Corp 7,979 7,497 A-
22 Simon Property Group Inc 7,877 7,663 A
23 General Mills Inc 7,807 7,350 BBB
24 CI Financial Corp 7,762 7,839 BBB
25 Discovery Inc 7,759 6,973 BBB-
Total $ 270,668 $ 260,622
% of total fixed income portfolio 8.7 % 8.7 %
(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>2020 Q2<br><br><br>2020 Q3<br><br><br>2020 Q4<br><br><br>2020 Q1<br><br><br>2021
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Recruits 262,732 303,867 290,886 282,207 400,345 84,762 133,123 101,861 80,599 94,633
Life-insurance licensed sales force, beginning of period 106,710 116,827 126,121 130,736 130,522 130,522 130,095 134,157 136,306 134,907
New life-licensed representatives 44,724 48,535 48,041 44,739 48,106 10,599 12,250 13,138 12,119 10,833
Non-renewal and terminated representatives (34,607 ) (39,241 ) (43,426 ) (44,953 ) (43,721 ) (11,026 ) (8,188 ) (10,989 ) (13,518 ) (13,710 )
Life-insurance licensed sales force, end of period 116,827 126,121 130,736 130,522 134,907 130,095 134,157 136,306 134,907 132,030
Issued term life policies 298,244 312,799 301,589 287,809 352,868 71,318 94,044 100,199 87,307 82,667
Issued term life face amount $ 89,869 $ 95,635 $ 95,209 $ 93,994 $ 109,436 $ 23,221 $ 27,754 $ 30,104 $ 28,357 $ 26,643
Term life face amount in force, beginning of period $ 693,194 $ 728,385 $ 763,831 $ 781,041 $ 808,262 $ 808,262 $ 804,512 $ 821,998 $ 840,227 $ 858,818
Issued term life face amount 89,869 95,635 95,209 93,994 109,436 23,221 27,754 30,104 28,357 26,643
Terminated term life face amount (57,238 ) (65,958 ) (70,291 ) (71,519 ) (60,848 ) (18,294 ) (14,315 ) (13,733 ) (14,506 ) (17,240 )
Foreign currency impact, net 2,560 5,769 (7,708 ) 4,746 1,968 (8,676 ) 4,046 1,859 4,740 1,422
Term life face amount in force, end of period $ 728,385 $ 763,831 $ 781,041 $ 808,262 $ 858,818 $ 804,512 $ 821,998 $ 840,227 $ 858,818 $ 869,643
Estimated annualized issued term life premium
Premium from new policies $ 237.9 $ 255.4 $ 250.8 $ 244.8 $ 303.6 $ 61.5 $ 77.7 $ 86.0 $ 78.4 $ 74.5
Additions and increases in premium 46.4 49.5 55.2 60.2 68.9 15.0 17.8 17.9 18.1 18.0
Total estimated annualized issued term life premium $ 284.3 $ 304.9 $ 306.0 $ 305.0 $ 372.5 $ 76.5 $ 95.5 $ 103.9 $ 96.5 $ 92.5
Investment & Savings product sales $ 5,594.3 $ 6,192.2 $ 7,040.1 $ 7,533.2 $ 7,842.5 $ 2,245.7 $ 1,686.5 $ 1,841.0 $ 2,069.4 $ 2,853.5
Investment & Savings average client asset values $ 49,427 $ 56,791 $ 61,842 $ 65,029 $ 69,709 $ 66,595 $ 64,638 $ 71,512 $ 76,090 $ 83,131
Closed U.S. Mortgage Volume (brokered) $ — $ — $ — $ 31.1 $ 442.5 $ 12.9 $ 65.8 $ 160.0 $ 203.8 $ 262.3

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