Primerica Inc.

11/05/2026 | Press release | Distributed by Public on 11/05/2026 13:12

Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to inform the reader about matters affecting the financial condition and results of operations of Primerica, Inc. (the "Parent Company") and its subsidiaries (collectively, "we", "us" or the "Company") for the period from December 31, 2025 to September 30, 2026. As a result, the following discussion should be read in conjunction with MD&A and the consolidated financial statements and notes thereto that are included in our Annual Report on Form 10-K for the year ended December 31, 2025 ("2025 Annual Report"). This discussion contains forward-looking statements that constitute our plans, estimates and beliefs. These forward-looking statements involve numerous risks and uncertainties, including, but not limited to, those discussed under the heading "Risk Factors" in the 2025 Annual Report and in Item 1A of this Report. Actual results may differ materially from those contained in any forward-looking statements.

This MD&A is divided into the following sections:

•
Business Overview
•
Business Trends and Conditions
•
Factors Affecting Our Results
•
Critical Accounting Estimates
•
Results of Operations
•
Financial Condition
•
Liquidity and Capital Resources

Business Overview

We are a leading diversified financial services distribution company serving middle-income households in the United States and Canada. Our licensed representatives ("independent sales representatives" or "independent sales force") educate families on how to prepare for a more secure financial future and help them achieve their financial goals with our term life insurance and third-party mutual funds, managed accounts, annuities, loans, and other financial products. We have two primary operating segments, Term Life Insurance and Investment and Savings Products, and a third segment, Corporate and Other Distributed Products.

Term Life Insurance. We distribute the term life insurance products that we underwrite through our three issuing life insurance company subsidiaries: Primerica Life Insurance Company ("Primerica Life"), National Benefit Life Insurance Company ("NBLIC"), and Primerica Life Insurance Company of Canada ("Primerica Life Canada"). Policies remain in-force until the expiration of the coverage period or until the policyholder ceases to make premium payments. Our in-force term life insurance policies have level premiums for the stated term period. As such, the policyholder pays the same amount each year. Initial policy term periods are between 10 and 35 years. While premiums typically remain level during the initial term period, our claim obligations generally increase as our policyholders age. We cede a significant portion of the mortality risk of our term life insurance policies to third-party reinsurers to substantially reduce the uncertainty of our benefits and claims expense. In addition, we incur significant up-front costs in acquiring new insurance business.

Investment and Savings Products. In the United States, we distribute mutual funds, managed accounts, variable annuity, and fixed annuity products of several third-party companies. We provide investment advisory and administrative services for client assets invested in our managed accounts investments program. We also perform distinct transfer agent recordkeeping services and non-bank custodial services for investors purchasing certain mutual funds we distribute. In Canada, we offer mutual funds of other companies and segregated funds. Our segregated funds product offerings consist of (1) our legacy segregated funds product, which is underwritten by Primerica Life Canada, and (2) a segregated funds product underwritten by a third-party.

Corporate and Other Distributed Products. The Corporate and Other Distributed Products segment includes net investment income earned on cash, cash equivalents, and our invested asset portfolio. This segment also includes revenues and expenses related to other distributed products, including closed blocks of various insurance products underwritten by NBLIC, prepaid legal services, mortgage originations, and other financial products. These products, except for closed blocks of various insurance products underwritten by NBLIC, are distributed pursuant to distribution arrangements with third-party companies through the independent sales force. Interest expense incurred by the Company is attributed to the Corporate and Other Distributed Products segment.

Business Trends and Conditions

The relative strength and stability of the financial markets and economies in the United States and Canada affect our growth and profitability. Our business is, and we expect will continue to be, influenced by a number of industry-wide and product-specific trends and conditions. Economic conditions, including unemployment levels, inflation and consumer confidence, influence investment and spending decisions by middle-income consumers, who are generally our primary clients. These conditions and factors also impact prospective recruits' perceptions of the business opportunity that becoming an independent sales representative offers. Consumer spending and borrowing levels affect how consumers evaluate their savings and debt management plans. In addition, investors'

perception of the strength of the capital markets and prospective returns impact consumer demand for the investment and savings products we distribute. We believe the economic conditions impacting middle-income households underscore their increasing need for our financial education, products and services to assist them in reaching the long-term goal of becoming financially independent.

The financial and distribution results of our operations in Canada, as reported in U.S. dollars, are affected by changes in the currency exchange rate. As a result, changes in the Canadian dollar exchange rate may significantly affect the results of our business for all amounts translated and reported in U.S. dollars.

The continuation of economic pressures within middle-income families, particularly younger generations, may be adversely impacting persistency and demand for term life insurance policies. In the first nine months of 2026, overall policy lapse rates of term life insurance products remained above long-term historical levels and sales of new term life insurance policies were lower versus the comparable period in 2025.

Meanwhile, favorable demographic trends, robust client demand, expanded product offerings, and strong equity market performance in recent periods have provided significant momentum for our Investment and Savings Products ("ISP") business. Despite volatility in the first half of 2026, positive equity market performance from 2024 through 2025 and through the first nine months of 2026 has beneficially influenced product sales and client asset values that drive revenue in the ISP segment.

Our ISP segment is expected to benefit over the long term from favorable demographic trends. These include increased demand for income and account value protection from investors in retirement that drive sales for our annuity business, the intergenerational wealth transfer from the silent generation and baby boomers to younger generations which benefits our managed accounts and mutual funds over future decades, and younger generations' increased interest in equity market investments. Additionally, our high concentration of client assets in retirement accounts and our systematic investment philosophy are beneficial to our business as these accounts tend to have lower redemption rates than the industry. Our long-standing relationship with clients positions us well to drive resilient and faster growth in the ISP segment.

The rise in market interest rates since the COVID-19 pandemic have driven the majority of unrealized losses that have accumulated in our investment portfolio from fixed-maturity securities purchased when long-term interest rates were at historical lows. In addition, interest rate increases in the third quarter of 2026 have contributed to higher unrealized losses in our investment portfolio at September 30, 2026 compared to the end of 2025. We have not recognized losses caused by interest rate volatility in the income statement for securities that we have no present intention to dispose of and we have the ability to hold these investments until maturity or a market price recovery. Elevated interest rates have also led to increases in net investment income as we are able to earn higher returns on our new fixed-maturity securities purchases and cash balances.

The effects of these trends and conditions on our quarterly results are discussed below in the Results of Operations and Financial Condition sections.

Size of the Independent Sales Force.

Our ability to increase the size of the independent sales force ("independent sales representatives" or "independent sales force") is largely based on the success of the independent sales force's recruiting efforts as well as training and motivating recruits to get licensed to sell life insurance. We believe that recruitment and licensing levels are important to independent sales force trends, and growth in recruiting and licensing is usually indicative of future growth in the overall size of the independent sales force. Recruiting changes do not always result in commensurate changes in the size of the licensed independent sales force because new recruits may obtain the requisite licenses at rates above or below historical levels.

Details on recruiting and life-licensed independent sales representative activity were as follows:

Three months ended September 30,

Nine months ended September 30,

2026

2025

2026

2025

New recruits

90,818

101,156

257,381

282,947

New life-licensed independent sales representatives

10,722

12,482

32,311

37,724

The decrease in the number of new recruits during the three months and nine months ended September 30, 2026 compared to the same periods in 2025 was likely attributable to a combination of factors that included broad economic conditions and uncertainty as well as a modestly smaller population of independent sales force representatives actively recruiting.

New life-licensed independent sales representatives decreased during the three and nine months ended September 30, 2026 compared to the same periods in 2025, largely due to the decline in new recruits in recent periods.

The size of the life-licensed independent sales force was as follows:

September 30, 2026

December 31, 2025

Life-licensed independent sales representatives, at period end

147,058

151,524

The number of life-licensed independent sales representatives as of September 30, 2026 was lower compared to December 31, 2025 as the number of new life-licensed representatives did not keep pace with the level of agent non-renewal and termination activity experienced during the first nine months of 2026.

Term Life Insurance Face Amount In-Force and Product Sales.

The changes in the face amount of our in-force book of term life insurance policies were as follows:

Three months ended September 30,

Nine months ended September 30,

2026

% of beginning balance

2025

% of beginning balance

2026

% of beginning balance

2025

% of beginning balance

(Dollars in millions)

Face amount in-force, beginning of period

$

967,905

$

968,312

$

967,612

$

953,583

Net change in face amount:

Issued face amount

25,708

3

%

27,067

3

%

79,124

8

%

85,814

9

%

Terminations

(24,862

)

(3

)%

(26,159

)

(3

)%

(74,085

)

(8

)%

(75,934

)

(8

)%

Foreign currency

(79

)

*

(2,196

)

*

(3,979

)

*

3,561

*

Net change in face amount

767

*

(1,288

)

*

1,060

*

13,441

1

%

Face amount in-force, end of period

$

968,672

$

967,024

$

968,672

$

967,024

* Less than 1%.

The face amount of term life insurance policies in-force increased for the three and nine months ended September 30, 2026 as the face amount issued exceeded the face amount terminated. Issued face amount decreased during the 2026 periods compared to the same periods in 2025 primarily due to the decrease in the number of new policies issued as discussed below. Policy terminations also decreased during the 2026 periods compared to the same periods in 2025. During the 2026 periods and the three months ended September 30, 2025, the strengthening of the U.S. dollar in relation to the Canadian dollar unfavorably impacted the translated face amount in-force, whereas a stronger Canadian dollar relative to the U.S. dollar contributed to an increase in the face amount in-force during the nine months ended September 30, 2025.

The average number of life-licensed independent sales representatives and the number of term life insurance policies issued, as well as the average monthly rate of new policies issued per life-licensed independent sales representative, were as follows:

Three months ended September 30,

Nine months ended September 30,

2026

2025

2026

2025

Average number of life-licensed independent sales representatives

147,919

152,494

149,167

152,218

Number of new policies issued

73,813

79,379

226,771

255,644

Average monthly rate of new policies issued per life-licensed
independent sales representative

0.17

0.17

0.17

0.19

The average number of life-licensed independent sales representatives decreased for the three and nine months ended September 30, 2026 from the same periods in 2025 as a result of the agent licensing activity discussed above.

New policies issued during the three and nine months ended September 30, 2026 decreased compared to the same periods in 2025, which we believe is attributable to the lower level of newly life-licensed independent sales representatives as well as macro level uncertainty that challenged demand for new policies.

Investment and Savings Product Sales, Asset Values and Accounts/Positions.

Investment and savings product sales were as follows:

Three months ended September 30,

Change

Nine months ended September 30,

Change

2026

2025

$

%

2026

2025

$

%

(Dollars in millions)

Product sales:

U.S. retail mutual funds

$

1,398

$

1,298

$

100

8

%

$

4,341

$

3,860

$

481

12

%

Canada retail mutual funds - with up-front sales commissions

211

186

25

13

%

645

575

70

12

%

Annuities and other

1,578

1,253

325

26

%

4,495

3,635

860

24

%

Total sales-based revenue generating product sales

3,187

2,737

450

16

%

9,481

8,070

1,411

17

%

Managed accounts

910

717

193

27

%

2,635

1,948

687

35

%

Canada retail mutual funds - no up-front sales commissions

261

245

16

7

%

857

760

97

13

%

Segregated funds

47

13

34

262

%

121

42

79

188

%

Total product sales

$

4,405

$

3,712

$

693

19

%

$

13,094

$

10,820

$

2,274

21

%

The rollforward of asset values in client accounts was as follows:

Three months ended September 30,

Nine months ended September 30,

2026

% of beginning balance

2025

% of beginning balance

2026

% of beginning balance

2025

% of beginning balance

(Dollars in millions)

Asset values, beginning of period

$

140,042

$

120,224

$

128,892

$

112,082

Net change in asset values:

Inflows

4,405

3

%

3,712

3

%

13,094

10

%

10,820

10

%

Redemptions

(3,998

)

(3

)%

(3,348

)

(3

)%

(11,929

)

(9

)%

(9,430

)

(8

)%

Net flows

407

*

364

*

1,165

*

1,390

1

%

Change in fair value, net

(819

)

*

6,562

5

%

10,243

8

%

12,790

11

%

Foreign currency, net

(15

)

*

(357

)

*

(685

)

*

531

*

Net change in asset values

(427

)

*

6,569

5

%

10,723

8

%

14,711

13

%

Asset values, end of period

$

139,615

$

126,793

$

139,615

$

126,793

* Less than 1%.

Average client asset values were as follows:

Three months ended September 30,

Change

Nine months ended September 30,

Change

2026

2025

$

%

2026

2025

$

%

(Dollars in millions)

Average client asset values:

U.S. retail mutual funds

$

63,837

$

58,410

$

5,427

9

%

$

62,126

$

55,794

$

6,332

11

%

Canada retail mutual funds

19,134

16,452

2,682

16

%

18,507

15,387

3,120

20

%

Annuities and other

35,672

32,189

3,483

11

%

34,538

30,795

3,743

12

%

Managed accounts

19,206

13,759

5,447

40

%

17,718

12,488

5,230

42

%

Segregated funds

2,304

2,307

(3

)

*

2,303

2,239

64

3

%

Total average client asset values

$

140,153

$

123,117

$

17,036

14

%

$

135,192

$

116,703

$

18,489

16

%

* Less than 1%.

Average number of fee-generating positions was as follows:

Three months ended September 30,

Change

Nine months ended September 30,

Change

2026

2025

Positions

%

2026

2025

Positions

%

(Positions in thousands)

Average number of fee-generating positions (1):

Recordkeeping and custodial

2,497

2,448

49

2

%

2,482

2,435

47

2

%

Recordkeeping only

952

902

50

6

%

938

893

45

5

%

Total average number of fee-generating positions

3,449

3,350

99

3

%

3,420

3,328

92

3

%

(1)
We receive transfer agent recordkeeping fees by mutual fund positions. An individual client account may include multiple mutual fund positions. We may also receive fees, which are earned on a per account basis, for custodial services that we provide to clients with retirement plan accounts that hold positions in these mutual funds.

Changes in Investment and Savings Product Sales, Asset Values and Accounts/Positions During the Three Months Ended September 30, 2026

Product sales. Investment and savings product sales increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The growth in product sales was driven by our clients' strong demand for retirement savings products, positive investor sentiment, and the effect of enhanced product offerings we have rolled out in recent years. Specifically, variable annuity product sales continued to grow as the guarantees offered by these products are more appealing to investors given strong equity market performance, expanded product offerings, and elevated interest rates. These trends have been further aided by the growing population of investors who are reaching retirement age and seeking the protection provided by annuity products. In addition, managed accounts product sales increased, fueled by continued strength in investor demand for these products as well as the expansion of investment strategies offered on our advisory platform. U.S. retail mutual fund sales experienced steady growth that was also boosted by sales force initiatives emphasizing the benefits of long-term investing.

Rollforward of client asset values. Ending client asset values decreased modestly during the three months ended September 30, 2026 as the decrease due to market value changes exceeded positive net flows. Ending client asset values increased during the three months ended September 30, 2025 primarily due to strong market performance.

Average client asset values. Average client asset values increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 primarily driven by the year-over-year cumulative effect of strong market performance and net client asset inflows.

Average number of fee-generating positions. The average number of fee-generating positions was higher during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 primarily due to the continued cumulative effect of retail mutual fund sales in recent periods that led to an increase in the number of retail mutual fund positions serviced on our transfer agent recordkeeping platform.

Changes in Investment and Savings Product Sales, Asset Values and Accounts/Positions During the Nine Months Ended September 30, 2026

Product sales. Investment and savings product sales increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison.

Rollforward of client asset values. Ending client asset values increased during the nine months ended September 30, 2026 and 2025 primarily due to strong market performance during both periods.

Average client asset values. Average client asset values increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison.

Average number of fee-generating positions. The average number of fee-generating positions was higher during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison.

Factors Affecting Our Results

Term Life Insurance Segment. The Term Life Insurance segment results are primarily driven by sales volumes, how closely actual experience matches our actuarial assumptions, terms and use of reinsurance, and expenses.

Sales and policies in-force. Sales of term life insurance policies and the size and characteristics of our in-force book of policies are vital to our results over the long term. Premium revenue is recognized as it is earned over the term of the policy. However, because we incur significant cash outflows at or about the time policies are issued, including the payment of sales commissions and underwriting costs, changes in life insurance sales volume in a period will have a more immediate impact on our cash flows than on revenue.

Sales volume of term life insurance products between fiscal periods may vary based on the productivity of independent sales representatives. Accordingly, the volume of term life insurance products sales will fluctuate in the short term, but over the longer term, our sales volume generally correlates to the size of the independent sales force.

Actuarial assumptions. The actuarial assumptions that underlie our reserves are based upon our best estimates of mortality, persistency, disability, and interest rates. Our results will be affected to the extent there is a variance between our actuarial assumptions and actual experience. These variances will be reflected in our financial results by unlocking assumptions and cash flows underlying the liability for future policy benefits ("LFPB") and ceded reserves that are part of the reinsurance recoverables. See Note 10 (Future Policy Benefits) to our unaudited condensed consolidated financial statements included elsewhere in this report for more information on LFPB. The variances are also reflected in the projection of future face amount that is the basis for amortizing deferred policy acquisition costs ("DAC").

•
Persistency. Persistency is a measure of how long our insurance policies stay in-force. As a general matter, persistency that is lower than our actuarial assumptions adversely affects our results over the long term because we lose the recurring revenue stream associated with the policies that lapse. However, on a short-term basis, the impact of lower persistency recognized during the period from experience variances and unlocking assumptions will increase earnings as the reserves needed for future policy benefits are reduced. In general, persistency differences have a minimal impact on our financial results from period to period since DAC is generally amortized on a straight-line basis and the unlocking of the LFPB adjusts both expected net premiums and expected future policy benefits and spreads any variances over the remaining contract period.
•
Mortality. Our profitability will fluctuate to the extent actual mortality rates differ from actuarial assumptions. We mitigate a significant portion of our mortality exposure through reinsurance. Long term mortality variances that result in an assumption change may have a significant impact on our financial results.
•
Disability. Our profitability will fluctuate to the extent actual disability rates underlying our waiver of premium benefits, including recovery rates for individuals currently disabled, differ from actuarial assumptions. The waiver of premium benefit is secondary to the death benefit coverage provided. However, the waiver of premium benefit is not reinsured on a yearly renewable term ("YRT") basis and material changes in assumptions compared to expectations can have a disproportionate impact on our financial results.
•
Interest Rates. We use a locked-in assumption for future interest rates for reserves underlying our segment results. Policies issued prior to the January 1, 2021 transition date of the Company's adoption of Accounting Standards Update No. 2018-12, Financial Services-Insurance (Topic 944) - Targeted Improvements to the Accounting for Long-Duration Contracts (the "Transition Date") use an interest rate that reflects the portfolio's current reinvestment rate while policies issued on or after the Transition Date use an upper-medium grade fixed income instrument yield during the period of issue.

Reinsurance. We use reinsurance extensively, which has a significant effect on our results of operations. We have generally reinsured between 80% and 90% of the mortality risk on term life insurance (excluding coverage under certain riders) on a quota share YRT basis. To the extent actual mortality experience is more or less favorable than the contractual rate, the reinsurer will earn incremental profits or bear the incremental cost, as applicable. In contrast to coinsurance, which is intended to eliminate all risks (other than counterparty risk of the reinsurer) and rewards associated with a specified percentage of the block of policies subject to the reinsurance arrangement, the YRT reinsurance arrangements we enter into are intended only to reduce volatility associated with variances between estimated and actual mortality rates.

In 2010, as part of our corporate reorganization and the initial public offering of our common stock, we entered into significant coinsurance transactions (the "IPO coinsurance transactions") with entities then affiliated with Citigroup, Inc. (collectively, the "IPO coinsurers") and ceded between 80% and 90% of the risks and rewards of term life insurance policies that were in-force at year-end 2009. We administer all such policies subject to these coinsurance agreements. Policies reaching the end of their initial level term period are no longer ceded under the IPO coinsurance transactions.

The effect of our reinsurance arrangements on ceded premiums and benefits and expenses on our unaudited condensed consolidated statements of income follows:

•
Ceded premiums. Ceded premiums are the premiums we pay to reinsurers. These amounts are deducted from the direct premiums we earn to calculate our net premium revenues. Similar to direct premium revenues, ceded coinsurance premiums remain level over the initial term of the insurance policy. Ceded YRT premiums increase over the period that the policy has been in-force. Accordingly, ceded YRT premiums generally constitute an increasing percentage of direct premiums over the policy term.
•
Benefits and claims. Benefits and claims include incurred claim amounts and changes in future policy benefit reserves. Reinsurance reduces incurred claims in direct proportion to the percentage ceded, and reinsurance cash flows are reflected in the ceded reserves included in reinsurance recoverables. Changes in ceded reserves offset changes in future policy benefit reserves.
•
Insurance expenses. Insurance expenses are reduced by the allowances received from coinsurance. There is no impact on insurance expenses associated with our YRT contracts.

We may alter our reinsurance practices at any time due to the unavailability of YRT reinsurance at attractive rates or the availability of alternatives to reduce our risk exposure. We intend to continue ceding approximately 90% of our mortality risk on new business.

Expenses. Results are also affected by variances in client acquisition, maintenance and administration expense levels.

Investment and Savings Products Segment. The Investment and Savings Products segment results are primarily driven by sales, the value of assets in client accounts for which we earn ongoing management, marketing and support, and distribution fees, and the number of transfer agent recordkeeping positions and non-bank custodial fee-generating accounts we administer.

Sales. We earn commissions and fees, such as dealer re-allowances and marketing and distribution fees, based on sales of mutual fund products and annuities in the United States and sales of certain mutual fund products in Canada. Sales of investment and savings products are influenced by the overall demand for investment and savings products in the United States and Canada, as well as by the size and productivity of the independent sales force. We generally experience seasonality in the Investment and Savings Products segment results due to our high concentration of sales of retirement account products. These accounts are typically funded in February through April, coincident with our clients' tax return preparation season. While we believe the size of the independent sales force is a factor in driving sales volume in this segment, there are a number of other variables, such as economic and market conditions, which may have a significantly greater effect on sales volume in any given fiscal period.

Asset values in client accounts. We earn marketing and distribution fees (trail commissions or, with respect to U.S. mutual funds, 12b-1 fees) on mutual fund and annuity assets in the United States and Canada. In the United States, we also earn investment advisory and administrative fees and marketing support fees on assets in managed accounts. In Canada, we earn marketing, distribution, and shareholder services fees on mutual fund assets for which we serve as the principal distributor and management fees on our legacy segregated funds. Asset values are influenced by new product sales, ongoing contributions to existing accounts, redemptions and the change in market values in existing accounts. While we offer a wide variety of asset classes and investment styles, our clients' accounts are primarily invested in equity funds. Volatility in equity markets will impact the value of assets in client accounts and, as a result, the revenue we earn on those assets.

Positions. We earn transfer agent recordkeeping fees for administrative functions we perform on behalf of several of our mutual fund providers. An individual client account may include multiple fund positions for which we earn transfer agent recordkeeping fees. We may also receive fees earned for non-bank custodial services that we provide to clients with retirement plan accounts.

Sales mix. Our results in a given fiscal period will be affected by changes in the overall mix of products within these categories. Examples of changes in the sales mix that influence our results include the following:

•
sales of annuity products in the United States will generate higher revenues in the period when such sales occur compared to sales of other investment products that either generate lower up-front revenues or, in the case of managed accounts, no up-front revenues;
•
sales of a higher proportion of managed accounts and Canadian mutual funds will spread the revenues generated over time because we earn higher revenues based on assets under management for these accounts each period as opposed to earning up-front revenues based on product sales; and
•
sales of a higher proportion of mutual fund products sold in the United States will impact the timing and amount of revenue we earn given the distinct transfer agent recordkeeping and non-bank custodial services we provide for certain mutual fund products we distribute.

Corporate and Other Distributed Products Segment. We earn revenues and pay commissions and referral fees within the Corporate and Other Distributed Products segment for mortgage loan originations, prepaid legal services, auto and homeowners' insurance referrals, and other financial products, all of which are originated by third parties. The Corporate and Other Distributed Products segment also includes in-force policies from several discontinued lines of insurance underwritten by NBLIC.

The Corporate and Other Distributed Products segment includes net investment income recognized by the Company. Net investment income is impacted by the size and performance of our invested asset portfolio, which can be influenced by interest rates, credit spreads, and the mix of invested assets. Net investment income also is influenced by short-term interest rates and the amount of cash and cash equivalents on hand.

The Corporate and Other Distributed Products segment also includes corporate income and expenses not allocated to our other segments, general and administrative expenses (other than expenses that are allocated to the Term Life Insurance and Investment and Savings Products segments), interest expense on notes payable, a redundant reserve financing transaction and our revolving credit facility ("Revolving Credit Facility"), as well as recognized gains and losses on our invested asset portfolio.

Capital Structure. Our financial results are affected by our capital structure, which includes our senior unsecured notes (the "Senior Notes"), a redundant reserve financing transaction, our Revolving Credit Facility, and our common stock. See our unaudited condensed consolidated balance sheets, Note 11 (Debt), and Note 12 (Stockholders' Equity) to our unaudited condensed consolidated financial statements included elsewhere in this report for more information on our capital structure.

Foreign Currency. The Canadian dollar is the functional currency for our Canadian subsidiaries, and our consolidated financial results, reported in U.S. dollars, are affected by changes in the currency exchange rate. As such, the translated amount of revenues, expenses, assets and liabilities attributable to our Canadian subsidiaries will be higher or lower in periods where the Canadian dollar appreciates or weakens relative to the U.S. dollar, respectively. See Item 7A. Quantitative and Qualitative Disclosures About Market Risk - Canadian Currency Risk and Note 4 (Segment and Geographical Information) to our consolidated financial statements included in our 2025 Annual Report for more information on our Canadian subsidiaries and the impact of foreign currency on our financial results.

Critical Accounting Estimates

We prepare our financial statements in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). These principles are established primarily by the Financial Accounting Standards Board. The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions based on currently available information when recording transactions resulting from business operations. Our significant accounting policies are described in Note 1 (Description of Business, Basis of Presentation, and Summary of Significant Accounting Policies) to our consolidated financial statements included in our 2025 Annual Report. The most significant items in our unaudited condensed consolidated balance sheets are based on fair value determinations, accounting estimates and actuarial determinations, which are susceptible to changes in future periods and could affect our results of operations and financial position.

The estimates that we deem to be most critical to an understanding of our results of operations and financial position are those related to DAC, future policy benefit reserves and corresponding amounts recoverable from reinsurers, income taxes, and the valuation of investments. The preparation and evaluation of these critical accounting estimates involve the use of various assumptions developed from management's analyses and judgments. Subsequent experience or use of other assumptions could produce significantly different results.

Results of Operations

Primerica, Inc. and Subsidiaries Results. Our results of operations were as follows:

Three months ended September 30,

Change

Nine months ended September 30,

Change

2026

2025

$

%

2026

2025

$

%

(Dollars in thousands)

Revenues:

Direct premiums

$

876,839

$

868,651

$

8,188

*

$

2,625,838

$

2,593,750

$

32,088

1

%

Ceded premiums

(423,209

)

(414,104

)

9,105

2

%

(1,280,348

)

(1,258,034

)

22,314

2

%

Net premiums

453,630

454,547

(917

)

*

1,345,490

1,335,716

9,774

*

Commissions and fees

386,717

325,490

61,227

19

%

1,112,069

928,478

183,591

20

%

Investment income net of investment expenses

58,085

56,907

1,178

2

%

171,192

168,796

2,396

1

%

Interest expense on surplus note

(12,345

)

(14,476

)

(2,131

)

(15

)%

(38,431

)

(43,766

)

(5,335

)

(12

)%

Net investment income

45,740

42,431

3,309

8

%

132,761

125,030

7,731

6

%

Realized investment gains (losses)

222

170

52

*

(548

)

(2,251

)

1,703

*

Other investment gains (losses)

(391

)

482

(873

)

*

2,465

794

1,671

*

Investment gains (losses)

(169

)

652

(821

)

*

1,917

(1,457

)

3,374

*

Other, net

15,736

16,732

(996

)

(6

)%

47,177

50,261

(3,084

)

(6

)%

Total revenues

901,654

839,852

61,802

7

%

2,639,414

2,438,028

201,386

8

%

Benefits and expenses:

Benefits and claims

167,452

172,152

(4,700

)

(3

)%

486,034

499,507

(13,473

)

(3

)%

Future policy benefits remeasurement (gain) loss

(11,833

)

(23,114

)

(11,281

)

*

(24,248

)

(32,282

)

(8,034

)

*

Amortization of DAC

86,592

81,498

5,094

6

%

255,979

240,091

15,888

7

%

Sales commissions

210,916

174,688

36,228

21

%

608,050

499,097

108,953

22

%

Insurance expenses

70,357

64,131

6,226

10

%

208,083

193,299

14,784

8

%

Insurance commissions

6,070

5,499

571

10

%

17,466

17,374

92

*

Interest expense

5,750

5,985

(235

)

(4

)%

17,443

17,990

(547

)

(3

)%

Other operating expenses

94,438

87,334

7,104

8

%

291,058

275,462

15,596

6

%

Total benefits and expenses

629,742

568,173

61,569

11

%

1,859,865

1,710,538

149,327

9

%

Income before income taxes

271,912

271,679

233

*

779,549

727,490

52,059

7

%

Income taxes

62,785

64,886

(2,101

)

(3

)%

178,048

173,303

4,745

3

%

Net income

$

209,127

$

206,793

$

2,334

1

%

$

601,501

$

554,187

$

47,314

9

%

* Less than 1% or not meaningful.

Results for the Three Months Ended September 30, 2026

Total revenues. Total revenues increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 primarily due to higher commissions and fees earned in our Investment and Savings Products segment and net investment income in our Corporate and Other Distributed Products segment. Further discussion related to revenue movements are discussed in detail in the Segment Results section below.

Total benefits and expenses. Total benefits and expenses increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 largely due to higher sales commissions in our Investment and Savings Products segment. Also contributing to the year-over-year increase were higher other operating expenses and insurance expenses in the 2026 period compared to the 2025 period primarily due to higher growth-related costs, technology investments, and employee compensation. In addition, there was higher amortization of DAC in our Term Life Insurance segment during the 2026 period compared to the 2025 period. The increases in total benefits and expenses were also impacted by a lower remeasurement gain in our Term Life Insurance segment. Further discussion related to benefits and expenses movements are discussed in detail in the Segment Results section below.

Income taxes. The effective income tax rate was 23.1% for the three months ended September 30, 2026 compared to the effective income tax rate of 23.9% for the three months ended September 30, 2025. The decrease in the effective income tax rate during the 2026 period was primarily driven by a decrease in the estimated annual effective tax rate due to the expected realization of federal income tax benefits in 2026 related to the tax equity investment that occurred in the second quarter of 2026, net of the related investment amortization. For more information on the tax equity investment and its impact on income taxes, see Note 4 (Investments) to our unaudited condensed consolidated financial statements included elsewhere in this report.

Results for the Nine Months Ended September 30, 2026

Total revenues. Total revenues increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison, in addition to an increase in net premiums in our Term Life Insurance segment and investment gains in our Corporate and Other Distributed Products segment.

Total benefits and expenses. Total benefits and expenses increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison.

Income taxes. The effective income tax rate was 22.8% for the nine months ended September 30, 2026 compared to the effective income tax rate of 23.8% for the nine months ended September 30, 2025. The decrease in the effective income tax rate during the 2026 period was primarily due to the same factor as described in the three month comparison.

For additional information, see the Segment Results discussions below.

Segment Results

Term Life Insurance Segment. Our results for the Term Life Insurance segment were as follows:

Three months ended September 30,

Change

Nine months ended September 30,

Change

2026

2025

$

%

2026

2025

$

%

(Dollars in thousands)

Revenues:

Direct premiums

$

872,573

$

864,047

$

8,526

*

$

2,613,380

$

2,580,396

$

32,984

1

%

Ceded premiums

(422,072

)

(412,935

)

9,137

2

%

(1,277,157

)

(1,254,576

)

22,581

2

%

Net premiums

450,501

451,112

(611

)

*

1,336,223

1,325,820

10,403

*

Other, net

11,066

12,189

(1,123

)

(9

)%

33,584

37,155

(3,571

)

(10

)%

Total revenues

461,567

463,301

(1,734

)

*

1,369,807

1,362,975

6,832

*

Benefits and expenses:

Benefits and claims

161,658

168,319

(6,661

)

(4

)%

473,083

488,287

(15,204

)

(3

)%

Future policy benefits remeasurement (gain) loss

(9,491

)

(23,392

)

(13,901

)

*

(21,913

)

(32,537

)

(10,624

)

*

Amortization of DAC

85,031

79,876

5,155

6

%

251,265

235,184

16,081

7

%

Insurance expenses

69,191

63,058

6,133

10

%

204,589

189,919

14,670

8

%

Insurance commissions

2,485

2,755

(270

)

(10

)%

6,750

7,641

(891

)

(12

)%

Total benefits and expenses

308,874

290,616

18,258

6

%

913,774

888,494

25,280

3

%

Income before income taxes

$

152,693

$

172,685

$

(19,992

)

(12

)%

$

456,033

$

474,481

$

(18,448

)

(4

)%

* Less than 1% or not meaningful.

Results for the Three Months Ended September 30, 2026

Net premiums. Direct premiums increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 largely due to the layering effect of new policy sales that contributed to growth in the in-force book of business compared to the prior year period. Higher ceded premiums exceeded the increase in direct premiums, which resulted in a slight decline in net premiums year over year. The increase in ceded premiums in the current year period was largely driven by $16.6 million in higher non-level YRT reinsurance ceded premiums as business not subject to the IPO coinsurance transactions ages, partially offset by $7.5 million of lower coinsurance ceded premiums due to the run-off of business subject to the IPO coinsurance transactions.

Benefits and claims. Benefits and claims decreased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025. Higher ceded premiums for YRT reinsurance as noted above contributed to the decrease in benefits and claims expense. As the Company cedes higher premiums to YRT reinsurers, it also cedes higher future policy benefits reserves to the YRT reinsurers, which effectively offsets the net amount of benefits and claims expense recognized.

Future policy benefits remeasurement (gain) loss. Future policy benefits remeasurement gain decreased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 and represents the impact of long-term assumption changes made during the third quarters of 2026 and 2025 in connection with the annual assumption reviews as well as differences in experience variances that occurred in each period. The future policy benefits remeasurement gain in the 2026 period was largely due to lower reserves benefiting from overall elevated lapse experience and better mortality compared to our future policy benefit reserve assumptions. The remeasurement gain in the 2025 period was primarily due to a larger assumption change for better mortality as well as experience variances recognized for lower mortality and elevated lapses. Refer to Note 10 (Future Policy Benefits) to our unaudited condensed consolidated financial statements included elsewhere in this report for further details.

Amortization of DAC. Amortization of DAC increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 primarily due to growth in the in-force book of business compared to the prior year period.

Insurance expenses. Insurance expenses increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 primarily due to higher technology investments, premium growth-related costs, and employee compensation.

Results for the Nine Months Ended September 30, 2026

Net premiums. Direct premiums increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 largely due to the layering effect of new policy sales that contributed to growth in the in-force book of business compared to the prior year period. The increase in direct premiums was mostly offset by higher ceded premiums, which resulted in a modest increase in net premiums during the nine months ended September 30, 2026 versus the comparable period in 2025. The increase in ceded premiums in the current year period was largely driven by $33.9 million in higher non-level YRT reinsurance ceded premiums as business not subject to the IPO coinsurance transactions ages, partially offset by $11.3 million of lower coinsurance ceded premiums due to the run-off of business subject to the IPO coinsurance transactions.

Benefits and claims. Benefits and claims decreased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison.

Future policy benefits remeasurement (gain) loss. Future policy benefits remeasurement gain decreased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the lower magnitude of assumption changes made in 2026 versus 2025 as described in the three month comparison. The future policy benefits remeasurement gain recognized in both periods also included experience variances due to overall elevated lapses and better mortality. Refer to Note 10 (Future Policy Benefits) to our unaudited condensed consolidated financial statements included elsewhere in this report for further details.

Amortization of DAC. Amortization of DAC increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factor as described in the three month comparison.

Insurance expenses. Insurance expenses increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison.

Investment and Savings Products Segment. Investment and Savings Products segment results were as follows:

Three months ended September 30,

Change

Nine months ended September 30,

Change

2026

2025

$

%

2026

2025

$

%

(Dollars in thousands)

Revenues:

Commissions and fees:

Sales-based revenues

$

140,822

$

118,637

$

22,185

19

%

$

412,686

$

345,841

$

66,845

19

%

Asset-based revenues

209,261

172,286

36,975

21

%

594,226

479,036

115,190

24

%

Account-based revenues

24,514

24,420

94

*

72,251

73,008

(757

)

(1

)%

Other, net

3,429

3,445

(16

)

*

10,026

10,013

13

*

Total revenues

378,026

318,788

59,238

19

%

1,089,189

907,898

181,291

20

%

Expenses:

Amortization of DAC

1,308

1,355

(47

)

(3

)%

3,946

4,060

(114

)

(3

)%

Insurance commissions

3,477

3,485

(8

)

*

10,384

10,229

155

2

%

Sales commissions:

Sales-based

98,767

82,867

15,900

19

%

289,751

243,069

46,682

19

%

Asset-based

106,518

87,337

19,181

22

%

302,555

241,593

60,962

25

%

Other operating expenses

53,902

49,522

4,380

9

%

163,384

154,032

9,352

6

%

Total expenses

263,972

224,566

39,406

18

%

770,020

652,983

117,037

18

%

Income before income taxes

$

114,054

$

94,222

$

19,832

21

%

$

319,169

$

254,915

$

64,254

25

%

* Less than 1% or not meaningful.

Results for the Three Months Ended September 30, 2026

Commissions and fees. Commissions and fees increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 primarily driven by higher asset-based revenues and sales-based revenues. Higher asset-based revenues were driven by an increase in average client assets in the 2026 period compared to the same period in 2025 as well as a higher mix of assets under management that earn higher asset-based commissions, namely managed accounts and Canadian mutual funds sold under the principal distributor model. The increase in sales-based revenue was largely the result of strong growth in product sales for variable annuities and U.S. retail mutual funds.

Sales commissions. The increases in asset-based commissions and sales-based commissions for the three months ended September 30, 2026 compared to the three months ended September 30, 2025 were largely in line with the increases in asset-based revenues and sales-based revenues, respectively.

Other operating expenses. Other operating expenses for the three months ended September 30, 2026 increased compared to the three months ended September 30, 2025 largely due to higher variable growth-related costs.

Results for the Nine Months Ended September 30, 2026

Commissions and fees. Commissions and fees increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison.

Sales commissions. The increases in asset-based commissions and sales-based commissions for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 were primarily due to the same factors as described in the three month comparison.

Other operating expenses. Other operating expenses for the nine months ended September 30, 2026 increased compared to the nine months ended September 30, 2025 largely due to the same factors as described in the three month comparison.

Corporate and Other Distributed Products Segment. Corporate and Other Distributed Products segment results were as follows:

Three months ended September 30,

Change

Nine months ended September 30,

Change

2026

2025

$

%

2026

2025

$

%

(Dollars in thousands)

Revenues:

Direct premiums

$

4,266

$

4,604

$

(338

)

(7

)%

$

12,458

$

13,354

$

(896

)

(7

)%

Ceded premiums

(1,137

)

(1,169

)

(32

)

(3

)%

(3,191

)

(3,458

)

(267

)

(8

)%

Net premiums

3,129

3,435

(306

)

(9

)%

9,267

9,896

(629

)

(6

)%

Commissions and fees

12,120

10,147

1,973

19

%

32,906

30,593

2,313

8

%

Investment income net of investment expenses

58,085

56,907

1,178

2

%

171,192

168,796

2,396

1

%

Interest expense on surplus note

(12,345

)

(14,476

)

(2,131

)

(15

)%

(38,431

)

(43,766

)

(5,335

)

(12

)%

Net investment income

45,740

42,431

3,309

8

%

132,761

125,030

7,731

6

%

Realized investment gains (losses)

222

170

52

*

(548

)

(2,251

)

1,703

*

Other investment gains (losses)

(391

)

482

(873

)

*

2,465

794

1,671

*

Investment gains (losses)

(169

)

652

(821

)

*

1,917

(1,457

)

3,374

*

Other, net

1,241

1,098

143

13

%

3,567

3,093

474

15

%

Total revenues

62,061

57,763

4,298

7

%

180,418

167,155

13,263

8

%

Benefits and expenses:

Benefits and claims

5,794

3,833

1,961

51

%

12,951

11,220

1,731

15

%

Future policy benefits remeasurement (gain) loss

(2,342

)

278

(2,620

)

*

(2,335

)

255

(2,590

)

*

Amortization of DAC

253

267

(14

)

(5

)%

768

847

(79

)

(9

)%

Insurance expenses

1,166

1,073

93

9

%

3,494

3,380

114

3

%

Insurance commissions

108

(741

)

849

*

332

(496

)

828

*

Sales commissions

5,631

4,484

1,147

26

%

15,744

14,435

1,309

9

%

Interest expense

5,750

5,985

(235

)

(4

)%

17,443

17,990

(547

)

(3

)%

Other operating expenses

40,536

37,812

2,724

7

%

127,674

121,430

6,244

5

%

Total benefits and expenses

56,896

52,991

3,905

7

%

176,071

169,061

7,010

4

%

Income (loss) before income taxes

$

5,165

$

4,772

$

393

8

%

$

4,347

$

(1,906

)

$

6,253

*

* Less than 1% or not meaningful.

Results for the Three Months Ended September 30, 2026

Total revenues. Total revenues increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 primarily due to net investment income, which increased largely due to continued growth of the invested asset portfolio. Investment income net of investment expenses includes interest earned on our held-to-maturity asset, which is offset by interest expense on the surplus note ("Surplus Note"), thereby eliminating any impact on net investment income. Amounts recognized for each line item will remain offsetting and will fluctuate from period to period along with the principal amounts of the held-to-maturity asset and the Surplus Note based on the balance of reserves being contractually supported under a redundant reserve financing transaction used by Vidalia Re, Inc. ("Vidalia Re"). For more information on the Surplus Note, see Note 4 (Investments) and Note 11 (Debt) to our unaudited condensed consolidated financial statements included elsewhere in this report.

Total benefits and expenses. Total benefits and expenses increased during the three months ended September 30, 2026 compared to the three months ended September 30, 2025 primarily due to increased other operating expenses. The increase in other operating expenses is primarily due to higher professional services fees and technology investments. The year over year change in benefits and claims expense combined with the change in the remeasurement gain (loss) was insignificant for the closed block of non-term life insurance products reported in our Corporate and Other Distributed products segment.

Results for the Nine Months Ended September 30, 2026

Total revenues. Total revenues increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison as well as an increase in investment gains (losses). The increase in investment gains (losses) is largely due to more favorable market performance for equity securities in the 2026 period and $2.0 million of investment losses in the 2025 period related to the tender of bonds from a certain issuer that allowed us to reinvest the proceeds at current market interest rates rather than accept replacement bonds from the issuer at less favorable terms.

Total benefits and expenses. Total benefits and expenses increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the same factors as described in the three month comparison.

Financial Condition

Investments. Our insurance business is primarily focused on selling term life insurance, which does not include an investment component for the policyholder. The invested asset portfolio funded by premiums from our term life insurance business does not involve the substantial asset accumulations and spread requirements that exist with other non-term life insurance products. As a result, the profitability of our term life insurance business is not as sensitive to the impact that interest rates have on our invested asset portfolio and investment income as the profitability of other companies that distribute non-term life insurance products.

We follow a conservative investment strategy designed to emphasize the preservation of our invested assets and provide adequate liquidity for the prompt payment of claims. To meet business needs and mitigate risks, our investment guidelines provide restrictions on our portfolio's composition, including limits on asset type, per issuer limits, credit quality limits, portfolio duration, limits on the amount of investments in approved countries and permissible security types. We also manage and monitor our allocation of investments to limit the accumulation of any disproportionate concentrations of risk among industry sectors or issuer countries outside of the U.S. and Canada. In addition, as of September 30, 2026, we did not hold any country of issuer concentrations outside of the U.S. or Canada that represented more than 5% of the fair value of our available-for-sale invested asset portfolio or any industry concentrations of corporate bonds that represented more than 10% of the fair value of our available-for-sale invested asset portfolio.

We invest a portion of our portfolio in assets denominated in Canadian dollars to support our Canadian operations. Additionally, to ensure adequate liquidity for payment of claims, we take into account the maturity and duration of our invested asset portfolio and our general liability profile.

We also hold within our invested asset portfolio a credit enhanced note ("LLC Note") issued by a limited liability company owned by a third-party service provider which is classified as a held-to-maturity security. The LLC Note, which is scheduled to mature on December 31, 2030, was obtained in exchange for the Surplus Note of equal principal amount issued by Vidalia Re, Inc. a special purpose financial captive insurance company and wholly owned subsidiary of Primerica Life. For more information on the LLC Note, see Note 4 (Investments) to our unaudited condensed consolidated financial statements included elsewhere in this report.

We have an investment committee composed of members of our senior management team that is responsible for establishing and maintaining our investment guidelines and supervising our investment activity. Our investment committee regularly monitors our overall investment results and our compliance with our investment objectives and guidelines. We use a third-party investment advisor to assist us in the management of our investing activities. Our investment advisor reports to our investment committee.

Our invested asset portfolio is subject to a variety of risks, including risks related to general economic conditions, market volatility, interest rate fluctuations, liquidity risk and credit and default risk. Investment guideline restrictions have been established to minimize the effect of these risks but may not always be effective due to factors beyond our control. Interest rates and credit spreads are highly sensitive to many factors, including governmental monetary policies, domestic and international economic and political conditions and other factors beyond our control. A significant increase in interest rates or credit spreads could result in significant unrealized losses in the value of our invested asset portfolio. We believe that fluctuations caused by movement in interest rates and credit spreads generally have little bearing on the recoverability of our investments as we have the ability to hold these investments until maturity or a market price recovery and we have no present intention to dispose of them.

Details on asset mix of fixed-maturity securities in our available-for-sale and trading securities investment portfolio (excluding short-term investments) were as follows:

September 30, 2026

December 31, 2025

Average rating of our fixed-maturity portfolio

A

A

Average duration of our fixed-maturity portfolio

5.3 years

5.2 years

Average book yield of our fixed-maturity portfolio

4.51%

4.30%

The distribution of fixed-maturity securities in our available-for-sale and trading securities investment portfolio (excluding short-term investments) by rating were as follows:

September 30, 2026

December 31, 2025

Amortized cost (1)

%

Amortized cost (1)

%

(Dollars in thousands)

AAA

$

683,297

19

%

$

666,842

20

%

AA

486,622

14

%

503,652

15

%

A

895,503

25

%

805,885

24

%

BBB

1,483,053

41

%

1,377,969

40

%

Below investment grade

43,285

1

%

36,627

1

%

Not rated

1,420

*

444

*

Total

$

3,593,180

100

%

$

3,391,419

100

%

(1)
Includes trading securities at carrying value and available-for-sale securities (excluding short-term investments) at amortized cost.

* Less than 1%.

The ten largest holdings within our fixed-maturity securities available-for-sale and trading securities invested asset portfolio (excluding short-term investments) were as follows:

September 30, 2026

Issuer

Fair value

Amortized cost (1)

Unrealized gain (loss)

Credit rating

(Dollars in thousands)

Province of Alberta Canada

$

13,957

$

15,010

$

(1,053

)

AA-

Province of Ontario Canada

13,162

13,768

(606

)

A+

T-Mobile US, Inc.

12,540

13,022

(482

)

BBB+

Devon Energy Corporation

11,577

11,902

(325

)

BBB+

Jefferies Financial Group Inc.

11,539

12,817

(1,278

)

BBB

Enbridge Inc.

11,506

12,341

(835

)

BBB+

Manulife Financial Corp

11,424

12,218

(794

)

A

Intact Financial Corporation

10,910

11,306

(396

)

A+

KKR & Co. Inc.

10,835

11,609

(774

)

A

Parker-Hannifin Corporation

10,702

11,382

(680

)

BBB+

Total - ten largest holdings

$

118,152

$

125,375

$

(7,223

)

Total - fixed-maturity securities

$

3,313,486

$

3,593,180

Percent of total fixed-maturity securities

4

%

3

%

(1)
Includes trading securities at carrying value and available-for-sale securities (excluding short-term investments) at amortized cost.

For additional information on our invested asset portfolio, see Note 4 (Investments) to our unaudited condensed consolidated financial statements included elsewhere in this report.

Liquidity and Capital Resources

Dividends and other payments to the Parent Company from its subsidiaries are our principal sources of cash. The amount of dividends paid by the subsidiaries is dependent on their capital needs to fund future growth and applicable regulatory restrictions. The primary uses of funds by the Parent Company include the payments of stockholder dividends, interest on note payable, general operating expenses, and income taxes, as well as repurchases of shares of our common stock outstanding. As of September 30, 2026, the Parent Company had cash, cash equivalents and available-for-sale securities of $599.8 million.

The Parent Company's subsidiaries generate operating cash flows primarily from term life insurance premiums (net of premiums ceded to reinsurers), income from invested assets, commissions and fees collected from the distribution of investment and savings products, as well as other financial products. The subsidiaries' principal operating cash outflows include the payment of insurance claims and benefits (net of ceded claims recovered from reinsurers), commissions to the independent sales force, insurance and other operating expenses, interest expense for future policy benefit reserves financing transactions, and income taxes.

The distribution and underwriting of term life insurance requires up-front cash outlays at the time the policy is issued as we pay a substantial majority of the sales commission during the first year following the sale of a policy and incur costs for underwriting activities at the inception of a policy's term. During the early years of a policy's term, we generally receive level term premiums in excess of claims paid. We invest the excess cash generated during earlier policy years primarily in fixed-maturity securities held in support of future policy benefit reserves. In later policy years, cash received from the maturity or sale of invested assets is used to pay claims in excess of level term premiums received.

Historically, cash flows generated by our businesses, primarily from our existing block of term life insurance policies and our investment and savings products, have provided us with sufficient liquidity to meet our operating requirements. We anticipate that cash flows from our businesses will continue to provide sufficient operating liquidity over the next 12 months.

If necessary, we could seek to enhance our liquidity position or capital structure through sales of our available-for-sale investment portfolio, changes in the timing or amount of share repurchases, borrowings against our Revolving Credit Facility, or some combination of these sources. Additionally, we believe that cash flows from our businesses and potential sources of funding will sufficiently support our long-term liquidity needs.

Cash Flows. The components of the changes in cash and cash equivalents were as follows:

Nine months ended September 30,

Change

2026

2025

$

(In thousands)

Net cash provided by (used in) operating activities

$

641,998

$

562,934

$

79,064

Net cash provided by (used in) investing activities

(98,677

)

(115,811

)

17,134

Net cash provided by (used in) financing activities

(515,436

)

(491,638

)

(23,798

)

Effect of foreign exchange rate changes on cash

(1,389

)

1,549

(2,938

)

Change in cash and cash equivalents

$

26,496

$

(42,966

)

$

69,462

Operating Activities. Cash flows provided by operating activities increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to higher cash inflows from Investment and Savings Products segment income in the 2026 period. In addition, operating cash flows from our Term Life Insurance segment were higher primarily due to the lower level of policy acquisition costs incurred in the 2026 period compared to the 2025 period. Also contributing to the change in cash flows provided by operating activities was the timing of purchases, maturities, and sales of financial instruments classified as trading securities.

Investing Activities. Cash flows used in investing activities decreased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to fluctuations in the timing of maturities, sales and reinvestments of debt securities held in our invested asset portfolio. This decrease was partially offset by a capital contribution made for a tax equity investment in the 2026 period. For more information on the tax equity investment, see Note 4 (Investments) to our unaudited condensed consolidated financial statements included elsewhere in this report.

Financing Activities. Cash flows used in financing activities increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the increase in the size of our share repurchase program and higher per share stockholder dividend payments.

Risk-Based Capital ("RBC"). The National Association of Insurance Commissioners ("NAIC") has established RBC standards for U.S. life insurers, as well as a risk-based capital model act (the "RBC Model Act") that has been adopted by the insurance regulatory authorities. The RBC Model Act requires that life insurers annually submit a report to state regulators regarding their RBC based upon four categories of risk: asset risk; insurance risk; interest rate risk and business risk. The capital requirement for each is determined by applying factors that vary based upon the degree of risk to various asset, premiums and policy benefit reserve items. The formula is an early warning tool to identify possible weakly capitalized companies for purposes of initiating further regulatory action. As of September 30, 2026, our U.S. life insurance subsidiaries maintained statutory capital and surplus substantially in excess of the applicable regulatory requirements and remain well positioned to support existing operations and fund future growth.

In Canada, an insurer's minimum capital requirement is overseen by the Office of the Superintendent of Financial Institutions ("OSFI") and determined as the sum of the capital requirements for six categories of risk: asset default risk; mortality/morbidity/lapse/expense risks; changes in interest rate environment risk; operational risk; segregated funds risk; and foreign exchange risk. As of September 30, 2026, Primerica Life Canada was in compliance with Canada's minimum capital requirements as defined by OSFI.

Redundant Reserve Financing. The Model Regulation titled Valuation of Life Insurance Policies, commonly known as Regulation XXX, requires insurers to carry statutory policy benefit reserves for term life insurance policies with long-term premium guarantees which are often significantly in excess of the future policy benefit reserves that insurers deem necessary to satisfy claim obligations ("redundant policy benefit reserves"). Accordingly, many insurance companies have sought ways to reduce their capital needs by financing redundant policy benefit reserves through bank financing, reinsurance arrangements and other financing transactions.

We have established Vidalia Re as a special purpose financial captive insurance company and wholly owned subsidiary of Primerica Life. Primerica Life has ceded certain term life insurance policies issued in 2011 through 2017 to Vidalia Re as part of a Regulation XXX redundant reserve financing transaction (the "Vidalia Re Redundant Reserve Financing Transaction"). This redundant reserve financing transaction allows us to more efficiently manage and deploy our capital.

The NAIC has adopted a model regulation for determining reserves using a principle-based approach ("principle-based reserves" or "PBR"), which is designed to reflect each insurer's own experience in calculating reserves and move away from a single prescriptive reserving formula. Primerica Life adopted PBR as of January 1, 2018 and NBLIC adopted the New York amended version of PBR effective January 1, 2021. PBR significantly reduced the redundant statutory policy benefit reserve requirements while still ensuring adequate liabilities are held. The regulation only applies for business issued after the effective dates. See Note 5 (Investments), Note 12 (Debt) and Note 18 (Commitments and Contingent Liabilities) to our consolidated financial statements in our 2025 Annual Report for more information on the Vidalia Re Redundant Reserve Financing Transaction.

Note Payable. The Company has $600.0 million of publicly-traded Senior Notes outstanding issued at a price of 99.55% with an annual interest rate of 2.80%, payable semi-annually in arrears on May 19 and November 19. The Senior Notes are scheduled to mature on November 19, 2031. We were in compliance with the covenants of the Senior Notes as of September 30, 2026. No events of default occurred during the three and nine months ended September 30, 2026.

Rating Agencies. There have been no changes to Primerica, Inc.'s Senior Notes ratings or Primerica Life's financial strength ratings since December 31, 2025.

Surplus Note. Vidalia Re issued a Surplus Note in exchange for the LLC Note as a part of the Vidalia Re Redundant Reserve Financing Transaction. The Surplus Note has a principal amount equal to the LLC Note and is scheduled to mature on December 31, 2030. For more information on the Surplus Note, see Note 11 (Debt) to our unaudited condensed consolidated financial statements included elsewhere in this report.

Off-Balance Sheet Arrangements. We have no transactions, agreements or other contractual arrangements to which an entity unconsolidated with the Company is a party, under which the Company maintains any off-balance sheet obligations or guarantees as of September 30, 2026.

Credit Facility Agreement. We maintain an unsecured $200.0 million Revolving Credit Facility with a syndicate of commercial banks. The Revolving Credit Facility, which had a previously-scheduled termination date of June 22, 2026, was renewed on June 2, 2026. The new termination date is June 2, 2031. As of September 30, 2026, no amounts were outstanding under the Revolving Credit Facility and we were in compliance with its covenants. Furthermore, no events of default occurred under the Revolving Credit Facility during the three and nine months ended September 30, 2026. For more information on the Revolving Credit Facility, see Note 11 (Debt) to our unaudited condensed consolidated financial statements included elsewhere in this report.

Contractual Obligations Update. There have been no material changes in contractual obligations from those disclosed in the 2025 Annual Report.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

Investors are cautioned that certain statements contained in this report as well as some statements in periodic press releases and some oral statements made by our officials during our presentations are "forward-looking" statements. Forward-looking statements include, without limitation, any statement that may project, indicate or imply future results, events, performance or achievements, and may contain the words "expect", "intend", "plan", "anticipate", "estimate", "believe", "will be", "will continue", "will likely result", and similar expressions, or future conditional verbs such as "may", "will", "should", "would", and "could". In addition, any statement concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, and possible actions taken by us or our subsidiaries are also forward-looking statements. These forward-looking statements involve external risks and uncertainties, including, but not limited to, those described under the section entitled "Risk Factors" included herein.

Forward-looking statements are based on current expectations and projections about future events and are inherently subject to a variety of risks and uncertainties, many of which are beyond the control of our management team. All forward-looking statements in this report and subsequent written and oral forward-looking statements attributable to us, or to persons acting on our behalf, are expressly qualified in their entirety by these risks and uncertainties. These risks and uncertainties include, among others:

Risks Related to Our Distribution Structure

•
Our failure to continue to attract new recruits, retain independent sales representatives or license or maintain the licensing of independent sales representatives would materially adversely affect our business.
•
A number of laws and regulations could apply to our independent contractor distribution model, which could require us to modify our distribution structure.
•
There may be adverse tax, legal or financial consequences if the classification of the independent contractor sales representatives is changed.
•
The Company's or the independent sales representatives' violation of, or non-compliance with, laws and regulations and related claims and proceedings could expose us to material liabilities.

Risks Related to Our Insurance Business and Reinsurance

•
Our life insurance business may face significant losses or volatility if our actual experience differs from our expectations regarding mortality, reinsurance, persistency, or disability.
•
Our life insurance business is highly regulated, and statutory and regulatory changes may materially adversely affect our business.
•
A decline in the regulatory capital ratios of our insurance subsidiaries could result in increased scrutiny by insurance regulators and ratings agencies and have a material adverse effect on our business.
•
A significant ratings downgrade by a ratings organization could materially adversely affect our business.
•
The failure by any of our reinsurers or reserve financing counterparties to perform its obligations to us could have a material adverse effect on our business.

Risks Related to Our Investment and Savings Products Business

•
Our Investment and Savings Products segment is heavily dependent on a limited platform of mutual fund and annuity products offered by a relatively small number of companies and managers. If these products fail to remain competitive with other investment options, our business could be materially adversely affected.
•
If our relationship with one or more of the manufacturers of the funds and annuities we distribute or investment managers we make available is significantly altered or terminated or there is a shift in the business mix, our business could be materially adversely affected.
•
The Company's, or the securities-licensed independent sales representatives' violations of, or non-compliance with, laws and regulations of the securities business could expose us to material liabilities.
•
If heightened standards of conduct are imposed on us or the independent sales representatives by federal, state or provincial authorities, or selling compensation is reduced as a result of new legislation or regulations, it could have a material adverse effect on our business.
•
If our suitability policies and procedures, or our policies and procedures for compliance with federal, state or provincial regulations governing standards of care, were deemed inadequate, it could have a material adverse effect on our business.
•
Non-compliance with applicable regulations could lead to revocation of our subsidiary's status as a non-bank custodian, which could have a material adverse effect on our business.

Risks Related to Our Mortgage Brokerage Business

•
Licensing requirements will impact the size of the mortgage loan independent sales force, which could adversely affect our mortgage brokerage business.
•
Our U.S. mortgage brokerage and Canadian mortgage referral business is highly regulated and subject to various federal, state and provincial laws and regulations in the U.S. and Canada. Changes in, non-compliance with, or violations of, such laws and regulations could affect the cost or our ability to distribute our products and could adversely affect our business.
•
In the U.S., we broker mortgage loans based on contractual agreements with a very limited number of mortgage lenders. A significant change to or disruption in the mortgage lenders' mortgage businesses or an inability of the mortgage lenders to satisfy their contractual obligations to us could adversely affect our business.
•
Our U.S. mortgage brokerage business is impacted by U.S. mortgage interest rates. Changes in prevailing mortgage interest rates or U.S. monetary policies that affect mortgage interest rates could adversely affect our business.

Risks Related to Economic Downcycles, Public Health Crises or Catastrophes, and Disasters

•
The effects of economic downcycles, issues affecting the national, regional and/or global economy or geopolitical event(s), or any combination thereof, could impact the cost of living for our middle-income clients and could materially adversely affect our business.
•
Major public health pandemics, epidemics or outbreaks (such as the COVID-19 pandemic) or other catastrophic events, have impacted and could again materially adversely impact our business.
•
In the event of a disaster, our business continuity plan may not be sufficient, which could have a material adverse effect on our business.

Risks Related to Information Technology and Cybersecurity

•
If one of our, or a third-party partner's, significant information technology systems fails, if its security is compromised, or if the Internet becomes disabled or unavailable, our business may be materially adversely affected.
•
Any failure to protect the confidentiality of client information could adversely affect our reputation and have a material adverse effect on our business.
•
The current legislative and regulatory climate with regard to privacy and cybersecurity could adversely affect our business.
•
The development and use of artificial intelligence present risks and challenges that could materially adversely affect our business.
•
We regularly undertake business initiatives to enhance our technology, products, and services. The efficiency and success of these initiatives may vary significantly and may cause unanticipated costs, errors, or disruptions which could have a material adverse effect on our business.

Financial Risks Affecting Our Business

•
Credit deterioration in, and the effects of interest rate fluctuations on, our invested asset portfolio and other assets that are subject to changes in credit quality and interest rates could materially adversely affect our business.
•
Valuation of our investments and the determination of expected credit losses when the fair value of our available-for-sale invested assets is below amortized cost are both based on estimates that may prove to be incorrect, which could adversely affect our financial condition and results of operations.
•
Changes in accounting standards can be difficult to predict and could adversely impact how we record and report our financial condition and results of operations.
•
The inability of our subsidiaries to pay dividends or make distributions or other payments to us in sufficient amounts would impede our ability to meet our obligations and return capital to our stockholders.

Risks Related to Legislative and Regulatory Changes and Government Policy Uncertainty

•
We are subject to various federal, state and provincial laws and regulations in the U.S. and Canada, as well as executive branch actions, orders and policies, judicial rulings and decisions by public officials, any of which may require us to alter our business practices and could materially adversely affect our business.
•
Uncertainty in the legislative and regulatory climate with regard to financial services may adversely affect our business.
•
The current regulatory climate with regard to climate change may adversely affect our business.

General Risk Factors

•
Litigation and regulatory investigations and actions may result in financial losses and harm our reputation.
•
A significant change in the competitive environment in which we operate could negatively affect our ability to maintain or increase our market share and profitability.
•
Our continued success requires a high-performing and stable team of employees across all levels, and the loss of key employees could negatively affect our financial condition and impair our ability to implement our business strategy.
•
We may not be able to effectively execute our corporate strategy, which could have a material adverse effect on our business.
•
We may be materially adversely affected by currency fluctuations in the United States dollar versus the Canadian dollar.
•
The market price of our common stock may fluctuate.

Developments in any of these areas could cause actual results to differ materially from those anticipated or projected or cause a significant reduction in the market price of our common stock.

The foregoing list of risks and uncertainties may not contain all of the risks and uncertainties that could affect us. In addition, in light of these risks and uncertainties, the matters referred to in the forward-looking statements contained in this report may not in fact

occur. Accordingly, undue reliance should not be placed on these statements. We undertake no obligation to publicly update or revise any forward-looking statements as a result of new information, future events or otherwise, except as otherwise required by law.

Primerica Inc. published this content on November 05, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on November 05, 2026 at 19:12 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]