Quarterly Report for Quarter Ending March 31, 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 March 31, 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

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. 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, equity market returns and interest rates impact consumer demand for the investment and savings products we distribute. Our customers' perception of the strength of the capital markets may also influence their decisions to invest in 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 cumulative impact of inflation in recent years has led to an elevated cost of living for middle-income families, which may be adversely impacting persistency and demand for term life insurance policies. In the first quarter of 2026, 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 quarter in 2025.

Meanwhile, strong equity market performance in recent periods, favorable demographic trends, and expanded product offerings have provided significant momentum for our Investment and Savings Products ("ISP") business. Despite volatility in the first quarter of 2026, positive equity market performance from 2024 through 2025 and into the first quarter 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 largely driven the unrealized losses that have accumulated in our investment portfolio from fixed-maturity securities purchased when long-term interest rates were at historical lows. Although market interest rates edged lower at the end of 2025, interest rates increased in the first quarter of 2026, resulting in higher unrealized losses 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:

The number of new recruits decreased during the three months ended March 31, 2026 compared to the same period in 2025 likely due to headwinds presented by economic and other uncertainty.

New life-licensed independent sales representatives decreased during the three months ended March 31, 2026 compared to the same period 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:

The number of life-licensed independent sales representatives decreased compared to December 31, 2025 as the number of new life-licensed representatives did not keep pace with the level of agent non-renewal activity experienced during the first quarter of 2026, which was in line with historical trends.

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

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:

The average number of life-licensed independent sales representatives decreased modestly for the three months ended March 31, 2026 from the same period in 2025 as a result of the agent licensing activity discussed above.

New policies issued during the three months ended March 31, 2026 decreased compared to the same period in 2025, which we believe is attributable to the lower level of newly life-licensed independent sales representatives as well as the continued period of uncertainty that challenged demand for new policies.

Productivity in the three months ended March 31, 2026, measured by the average monthly rate of new policies issued per life-licensed independent sales representative, decreased from the same period in 2025. Lower year-over-year productivity is due to the decline in new life insurance policy sales relative to the generally stable size of the life-licensed sales force.

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

* Less than 1%.

The face amount of term life insurance policies in-force decreased slightly for the three months ended March 31, 2026 primarily due to the translation impact on the face amount of our Canadian term life insurance in-force business during the period. Newly issued term life insurance face amounts were largely offset by policy terminations during the three months ended March 31, 2026. Issued face amount decreased during the 2026 period compared to the same period in 2025 primarily due to the decrease in the number of new policies issued as discussed above. Policy terminations increased during the 2026 period compared to the same period in 2025 but were largely consistent when measured as a percentage of beginning face amount in-force.

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

Investment and savings product sales were as follows:

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

* Less than 1%.

Average client asset values were as follows:

Average number of fee-generating positions was as follows:

Changes in Investment and Savings Product Sales, Asset Values and Accounts/Positions During the Three Months Ended March 31, 2026

Product sales. Investment and savings product sales increased during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to sustained positive investor sentiment that followed generally strong equity market performance in 2024 through 2025 and continued into the beginning of the first quarter of 2026. In particular, 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. In addition, the increase in product sales for managed accounts resulted from continued strength in investor demand for these products as well as the expansion of investment strategies offered on our platform. U.S. retail mutual fund sales also continued to increase. 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 as well as the investment advisory services and broader products offered through our managed accounts investments program.

Rollforward of client asset values. Ending client asset values decreased during the three months ended March 31, 2026 primarily due to the decline in market performance during March 2026, partially offset by positive net inflows. A similar dynamic was observed during the three months ended March 31, 2025 as the drop in equity markets during that period exceeded positive inflows.

Average client asset values. Average client asset values increased during the three months ended March 31, 2026 compared to the three months ended March 31, 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 March 31, 2026 compared to the three months ended March 31, 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.

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").

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:

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:

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 condensed consolidated balance sheets and Note 11 (Stockholders' Equity) to our unaudited condensed consolidated financial statements included elsewhere in this report and Note 12 (Debt) to our consolidated financial statements included in our 2025 Annual 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:

* Less than 1% or not meaningful.

Results for the Three Months Ended March 31, 2026

Total revenues. Total revenues increased during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to increases in commissions and fees earned in our Investment and Savings Products segment and net premiums in our Term Life Insurance 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 March 31, 2026 compared to the three months ended March 31, 2025 largely due to higher sales commissions in our Investment and Savings Products segment. Also contributing to the year-over-year increase were higher amortization of DAC in our Term Life Insurance segment. Insurance expenses and other operating expenses increased in the 2026 period compared to the 2025 period primarily due to an increase in growth-related costs and technology investments. The increases in total benefits and expenses were partially offset by lower benefits and claims (net of future policy benefits remeasurement (gain) loss) 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 of 23.8% for the three months ended March 31, 2026 was largely consistent with the effective income tax rate of 23.6% for the three months ended March 31, 2025.

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:

* Less than 1% or not meaningful.

Results for the Three Months Ended March 31, 2026

Net premiums. Direct premiums increased during the three months ended March 31, 2026 compared to the three months ended March 31, 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. This increase was partially offset by an increase in ceded premiums, which includes $7.4 million in higher non-level YRT reinsurance ceded premiums as business not subject to the IPO coinsurance transactions ages, and was reduced by $2.9 million in lower coinsurance ceded premiums due to the run-off of business subject to the IPO coinsurance transactions.

Benefits and claims. Benefits and claims decreased modestly during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 despite the increase in net premiums. Higher ceded premiums for YRT reinsurance as noted above contributed to the lack of growth 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. Meanwhile, the overall year-over-year decrease in the net benefits and claims expense can be attributed to modest adjustments to claims estimates recognized in 2025.

Future policy benefits remeasurement (gain) loss. Future policy benefits remeasurement gain increased during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 and represents differences in experience variances that occurred in each period, primarily from better mortality and lower reserves benefiting from elevated lapse experience compared to our future policy benefit reserve assumptions.

Amortization of DAC. Amortization of DAC increased during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to growth in the in-force book of business compared to the prior year period.

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

* Less than 1% or not meaningful.

Results for the Three Months Ended March 31, 2026

Commissions and fees. Commissions and fees increased during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily driven by higher asset-based 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, to a lesser extent, U.S. retail mutual funds.

Sales commissions. The increases in asset-based and sales-based commissions for the three months ended March 31, 2026 compared to the three months ended March 31, 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 March 31, 2026 increased compared to the three months ended March 31, 2025 largely due to higher employee compensation, variable growth-related costs, and continued investments in technology and infrastructure.

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

* Less than 1% or not meaningful.

Results for the Three Months Ended March 31, 2026

Total revenues. Total revenues increased modestly during the three months ended March 31, 2026 compared to the three months ended March 31, 2025. Net investment income 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 12 (Debt) to our consolidated financial statements in our 2025 Annual Report and Note 4 (Investments) to our unaudited condensed consolidated financial statements included elsewhere in this report.

Total benefits and expenses. Total benefits and expenses were largely consistent during the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

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 March 31, 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 were as follows:

The distribution of fixed-maturity securities in our available-for-sale and trading securities investment portfolio by rating were as follows:

* Less than 1%.

The ten largest holdings within our fixed-maturity securities available-for-sale and trading securities invested asset portfolio were as follows:

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 March 31, 2026, the Parent Company had cash and invested assets of $555.8 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:

Operating Activities. Cash flows provided by operating activities decreased during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to timing differences in payments made for income tax remittances. The largest timing difference resulted from a payment made in the first quarter of 2026 for a transferable federal tax credit that was used to offset estimated federal income tax payments in the fourth quarter of 2025. 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 three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to fluctuations in the timing of maturities, sales and reinvestments of debt securities held in our available-for-sale investment portfolio.

Financing Activities. Cash flows used in financing activities increased during the three months ended March 31, 2026 compared to the three months ended March 31, 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 March 31, 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 March 31, 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 March 31, 2026. No events of default occurred during the three months ended March 31, 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 12 (Debt) to our consolidated financial statements in our 2025 Annual 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 March 31, 2026.

Credit Facility Agreement. We maintain an unsecured $200.0 million Revolving Credit Facility with a syndicate of commercial banks that has a scheduled termination date of June 22, 2026. Amounts outstanding under the Revolving Credit Facility bear interest at a periodic rate equal to the Secured Overnight Financing Rate ("SOFR") rate loan or the base rate, plus in either case an applicable margin. The Revolving Credit Facility also permits the issuance of letters of credit. The applicable margins are based on our debt rating with such margins for SOFR rate loans and letters of credit ranging from 1.000% to 1.625% per annum and for base rate loans ranging from 0.000% to 0.625% per annum. Under the Revolving Credit Facility, we incur a commitment fee that is payable quarterly in arrears and is determined by our debt rating. This commitment fee ranges from 0.100% to 0.225% per annum of the aggregate $200.0 million commitment of the lenders under the Revolving Credit Facility. As of March 31, 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 months ended March 31, 2026.

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

Risks Related to Our Insurance Business and Reinsurance

Risks Related to Our Investment and Savings Products Business

Risks Related to Our Mortgage Brokerage Business

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

Risks Related to Information Technology and Cybersecurity

Financial Risks Affecting Our Business

Risks Related to Legislative and Regulatory Changes and Government Policy Uncertainty

General Risk Factors

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.