Citizens Reports Fourth Quarter and Full Year 2022 Financial Results.

AUSTIN, Texas: Citizens, Inc. (NYSE: CIA), today reported financial results for the quarter and year ended December 31, 2022.

Management Commentary

"Overall, I am pleased with the Company's execution toward its long-term strategic goals," said Company Vice Chairman and CEO, Gerald W. Shields. "Although we witnessed some of the industrywide impacts of inflation and volatile equity markets, the fundamental and controllable elements of our business continue to strengthen and improve. These improvements are the direct result of actions we have taken over the past two years to issue new products, improve distribution through focused sales promotions and campaigns, and improve policy retention. New products are an increasingly important part of our success and have been instrumental in driving the year-over-year growth of insurance issued to record levels; the number of policies issued has grown for three straight quarters."

Full Year 2022 Operating Highlights

Net loss for the year ended December 31, 2022 totaled $6.6 million, or $0.13 per diluted class A share, compared to a net gain of $36.8 million, or $0.73 per diluted class A share, in 2021. However, year-over-year comparisons are difficult due to a one-time tax benefit and a one-time goodwill impairment that occurred in the fourth quarter of 2021, as well as $10.3 million in non-core, and primarily non-cash, investment related losses caused by the impact of inflation on market volatility and interest rates during 2022.

Excluding these one-time items and investment related gains and losses, operating income increased by $8.3 million in 2022, driven by higher net investment income, lower death claims and lower property claims, compared to 2021.

In 2022, the Company made considerable advancements toward its strategic goals through its focus on delivering the right products to the right customer, in the most efficient way possible. To this end, the Company introduced eight new customer-focused products and product enhancements, implemented sales promotions and campaigns that promote growth, and implemented process improvements and new technologies to get products to customers faster. The combined impact of these initiatives resulted in total life insurance issued and the number of policies issued growth of 64% and 18%, respectively.

Total first year premium trends improved steadily through 2022, which the Company believes are the result of strong demand for its new life insurance products. However, consolidated first-year premiums decreased 1%, as strong growth in the Life Insurance segment was more than offset by a decrease in the Home Service Insurance segment, which the Company believes is due to the impact of inflation on its customer base. Renewal premiums also decreased less than 1% and total premium revenue in 2022 decreased less than 1%.

Total claims and surrenders benefits in 2022 increased less than 1%, compared to 2021, primarily driven by higher matured...