Citizens Direct Premiums Rise 7% as Earnings Turn to Loss

The Tip Desk · November 5, 2026 · 3 min read

Direct insurance premiums reached $50 million in the third quarter, up 7% from a year earlier, as first-year sales extended a sixteen-quarter year-over-year streak.

Citizens, Inc. (CIA), a diversified financial services company specializing in life, living benefits, and final expense insurance, reported direct insurance premiums of $50 million in the third quarter ended September 30, 2026, up 7% from $46.6 million a year earlier. Direct first-year premiums rose 9%, extending a year-over-year increase for a sixteenth consecutive quarter.

President and Chief Executive Officer Jon Stenberg said the year-ago comparison was tougher because the third quarter of 2025 benefited from substantial reserve releases tied to matured endowment payments. He said the company expects endowment maturities to become a smaller factor over time.

Total revenues were $65 million, up from $62.8 million in the year-ago quarter, including a $1.5 million increase in premium revenue and a $2.6 million increase in investment related gains. Adjusted total revenues, which exclude investment related gains, were $63.6 million, down from $64.1 million a year earlier as higher premium revenue was offset by lower net investment income and other income.

The company posted a net loss of $0.4 million, or $0.01 a share, versus net income of $2.4 million, or $0.04 a share, a year earlier. Adjusted net income was $1 thousand, or $0.00 a share, versus $3.4 million, or $0.07 a share, in the year-ago quarter.

Total benefits and expenses increased to $64.9 million from $58.3 million a year earlier. Claims and surrenders decreased $13.2 million due to expected contractual decreases of matured endowments. The company said those maturities reached their highest level in 2025 and expects reduced levels in 2026 and over the next few years. That decline was more than offset by a $16.3 million increase in future policy benefit reserves, primarily reflecting additional reserves for the growing in-force Domestic Insurance business and lower reserve releases from matured endowments. The increase also included a $1.7 million decrease in the ceded reserve credit from a change in accounting estimate to use enhanced data sources.

Net investment income decreased to $18.1 million from $19.1 million a year earlier, primarily from a $1.7 million discrete dividend from a limited partnership investment recognized in the prior year and comparatively higher investment expenses. The average annualized yield on the investment portfolio was 4.48%. Other income related to supplemental contracts is expected to decline as contractual obligations for matured endowment benefits also decline.

International Insurance direct insurance premiums were $29.7 million, versus $29.2 million a year earlier. Income before federal income tax was $3.5 million, versus a $0.1 million loss a year earlier. Claims and surrenders in that segment fell to $23.0 million from $38.0 million.

Domestic Insurance direct insurance premiums were $20.4 million, versus $17.4 million a year earlier. Income before federal income tax was an $0.9 million loss, versus $6.6 million of income a year earlier. Total benefits and expenses in the segment rose to $21.7 million from $13.7 million.

Premium growth was driven by the Domestic Insurance segment and constrained by unfavorable persistency there, as well as by high surrenders and matured endowments in International Insurance that have reduced policies remaining in force.

The domestic producing-agent network was up 12% since September 30, 2025. Total direct insurance in force was $5.6 billion. Book value per Class A share was $4.37 on September 30, 2026, down from $4.49 a year earlier. Adjusted book value per Class A share excluding accumulated other comprehensive income was $6.44, up from $6.26. Cash and cash equivalents were $17.6 million, with no debt. The company reported $13 million of net cash provided by operating activities.

Stenberg said the company announced it will invest in a modern technology ecosystem, moving to third-party, cloud-based platforms for insurance processing, underwriting, and policy administration. He said targeted investments are designed to accelerate premium growth and increase adjusted book value per share.