Future Policy Benefits

6 Months Ended

Jun. 30, 2026

Note 5 – Future Policy Benefits

In 2025 and 2026, the Company updated the net premium ratio when updating for actual historical experience; future cash flow assumptions were reviewed and updated if appropriate.

The following tables summarize balances and changes in the liability for future policy benefits for nonparticipating traditional and limited-payment contracts.


June 30, 2026	Traditional Premium Paying						Traditional Limited Pay						Total
		Present Value of Net Premiums			Present Value of Benefits			Present Value of Net Premiums			Present Value of Benefits			Present Value of Net Premiums			Present Value of Benefits
Balance, beginning of year	$	3,971,915		$	21,601,667		$	(10,695,983	)	$	28,599,439		$	(6,724,068	)	$	50,201,106
Beginning balance at original discount rate		4,193,882			22,968,581			(11,298,224	)		30,964,035			(7,104,342	)		53,932,616
Effect of changes in CF considerations		804,625			1,146,539			2,412,098			2,759,828			3,216,723			3,906,367
Effect of actual variances from expected		(240,567	)		(336,083	)		(295,827	)		(377,286	)		(536,394	)		(713,369	)

Adjusted beginning of period balance		4,757,940			23,779,037			(9,181,953	)		33,346,577			(4,424,013	)		57,125,614
New issuances		0			0			0			0			0			0
Interest accrual		393,026			614,850			769,957			376,123			1,162,983			990,973
Premiums		(417,773	)		0			(14,387	)		0			(432,160	)		0
Benefit Payments		0			(818,551	)		0			(750,144	)		0			(1,568,695	)

Ending balance at original discount rate		4,733,193			23,575,336			(8,426,383	)		32,972,556			(3,693,190	)		56,547,892
Effect of changes in discount rate		(317,208	)		(1,750,476	)		559,765			(3,226,039	)		242,557			(4,976,515	)

Balance, end of year	$	4,415,985		$	21,824,860		$	(7,866,618	)	$	29,746,517		$	(3,450,633	)	$	51,571,377

Net liability for future policy benefits	$17,408,875						$37,613,135						$55,022,010

Deferred profit liability	$0						$1,308,482						$1,308,482


June 30, 2025	Traditional Premium Paying						Traditional Limited Pay						Total
		Present Value of Net Premiums			Present Value of Benefits			Present Value of Net Premiums			Present Value of Benefits			Present Value of Net Premiums			Present Value of Benefits
Balance, beginning of year	$	4,293,082		$	22,118,278		$	(12,243,574	)	$	26,826,750		$	(7,950,492	)	$	48,945,028
Beginning balance at original discount rate		4,711,513			24,563,973			(13,416,148	)		30,636,495			(8,704,635	)		55,200,468
Effect of changes in CF considerations		0			0			0			0			0			0
Effect of actual variances from expected		(262,585	)		(280,702	)		682,111			745,613			419,526			464,911

Adjusted beginning of period balance		4,448,928			24,283,271			(12,734,037	)		31,382,108			(8,285,109	)		55,665,379
New issuances		0			0			0			0			0			0
Interest accrual		845,311			1,023,163			297,168			(299,385	)		1,142,479			723,778
Premiums		(327,102	)		0			(13,493	)		0			(340,595	)		0
Benefit Payments		0			(1,032,617	)		0			(727,387	)		0			(1,760,004	)

Ending balance at original discount rate		4,967,137			24,273,817			(12,450,362	)		30,355,336			(7,483,225	)		54,629,153
Effect of changes in discount rate		(311,849	)		(1,714,178	)		774,163			(2,763,196	)		462,314			(4,477,374	)

Balance, end of year	$	4,655,288		$	22,559,639		$	(11,676,199	)	$	27,592,140		$	(7,020,911	)	$	50,151,779

Net liability for future policy benefits	$17,904,351						$39,268,339						$57,172,690

Deferred profit liability	$0						$866,468						$866,468

The following table reconciles the net liability for future policy benefits to the liability for future policy benefits in the consolidated balance sheet. The DPL for the limited pay products is presented together with the liability for future policy benefits in the consolidated balance sheet. Furthermore, there is a block of participating policies that was deemed outside the scope of the changes related to the LFPB as a result of ASU 2018-12. Thus this block continues to hold reserves consistent with historical. Lastly, a block that is 100% coinsured to Park Avenue Life Insurance Company (PALIC) was not considered in the roll forwards. The Company continues to hold a gross reserve utilizing an approach consistent with the pre-ASU-2018-12 reserves, with a net liability of zero.

		June 30, 2026		December 31, 2025
Traditional Premium Paying	$	17,408,875	$	17,629,752
Traditional Limited Pay		38,921,617		40,196,147
Participating Policies		40,523,140		40,810,267
Miscellaneous Reserves		2,078,385		2,108,019
PALIC		13,487,602		13,559,661
A&H		67,052		67,452
Total	$	112,486,671	$	114,371,298

The undiscounted expected future benefit payments and gross premiums as of June 30, 2026, and 2025 are summarized as follows:


		Undiscounted		Original Present Value		Current Present Value
June 30, 2026
Gross premiums	$	11,282,513	$	8,442,705	$	7,877,059
Benefits		82,628,827		56,547,892		51,571,377
June 30, 2025
Gross premiums	$	14,623,255	$	10,627,336	$	9,960,340
Benefits		82,407,189		54,629,153		50,151,779

The weighted-average interest rates as of June 30, 2026, and 2025 are summarized as follows:


	June 30, 2026		June 30, 2025
Original discount rate	3.92	%	3.92	%
Current discount rate	5.06	%	4.89	%

The weighted-average durations of the liability in years as of June 30, 2026, and 2025 are summarized as follows:

	June 30, 2026	June 30, 2025
Original duration of the liability in years	8.76	9.52
Current duration of the liability in years	8.20	9.01

The actual experience during the years ended June 30, 2026 and 2025 compared to what was expected for the years ended June 30, 2026 and 2025 is summarized as follows:

June 30, 2026		Amount Inforce		Mortality			Lapsation			Maturity			Total Benefits
Expected	$	154,049,308	$	2,061,044		$	522,373		$	162,780		$	2,746,197
Expected rate				1.34	%		0.34	%		0.10	%		1.78	%
Actual	$	153,694,412	$	1,568,696		$	503,523		$	176,512		$	2,248,731
Actual rate				1.02	%		0.33	%		0.11	%		1.46	%
Actual to expected ratio				76.11	%		96.39	%		108.44	%		81.89	%

June 30, 2025		Amount Inforce		Mortality			Lapsation			Maturity			Total Benefits
Expected	$	161,439,700	$	1,832,413		$	461,163		$	124,328		$	2,417,904
Expected rate				1.14	%		0.29	%		0.08	%		1.51	%
Actual	$	160,524,592	$	1,760,005		$	475,221		$	137,652		$	2,372,878
Actual rate				1.09	%		0.29	%		0.09	%		1.47	%
Actual to expected ratio				96.05	%		103.05	%		110.72	%		98.14	%

Significant assumption inputs to the calculation of the liability for future policy benefits for the nonparticipating traditional and limited pay products include mortality, lapses and discount rates. Given limited credibility, the Company did not make any assumption changes since transition.

Policyholders’ Account Balances include universal life and annuity contracts.

The composition of universal life and annuities included in Policyholders’ Account Balances as of June 30, 2026, and December 31, 2025 is summarized as follows:

		June 30, 2026		December 31, 2025
Annuity	$	24,495,527	$	24,769,354
Universal Life		66,672,505		68,151,712
Total policyholder account balances	$	91,168,032	$	92,921,066

The range of crediting rates for policyholders’ account balances compared to the guaranteed minimum crediting rates as of June 30, 2026, and 2025 are presented as follows:

June 30, 2026		At Guaranteed Minimum		1 Basis Point to 50 Basis Points Above Guaranteed Minimum		51 Basis Point to 150 Basis Points Above Guaranteed Minimum		Greater Than 150 Basis Points Above Guaranteed Minimum		Total
Less than 2.00%	$	750,284	$	0	$	0	$	0	$	750,284
2.00% to 2.99%		196,542		0		0		0		196,542
3.00% to 3.99%		5,263,961		0		0		0		5,263,961
Greater than 4.00%		66,851,022		196,863		17,909,360		0		84,957,245
Total	$	73,061,809	$	196,863	$	17,909,360	$	0	$	91,168,032

June 30, 2025		At Guaranteed Minimum		1 Basis Point to 50 Basis Points Above Guaranteed Minimum		51 Basis Point to 150 Basis Points Above Guaranteed Minimum		Greater Than 150 Basis Points Above Guaranteed Minimum		Total
Less than 2.00%	$	753,057	$	0	$	0	$	0	$	753,057
2.00% to 2.99%		224,698		0		0		0		224,698
3.00% to 3.99%		5,362,611		0		0		0		5,362,611
Greater than 4.00%		69,661,378		197,050		17,864,613		0		87,723,041
Total	$	76,001,744	$	197,050	$	17,864,613	$	0	$	94,063,407

The change in the policyholders account balances for the years ended June 30, 2026, and 2025 are summarized as follows:

	June 30, 2026						June 30, 2025
		Universal Life			Annuity			Universal Life			Annuity
Balance, beginning of year	$	68,151,712		$	24,769,354		$	69,836,708		$	25,403,323
Issuances		0			0			0			0
Premiums received		1,795,606			70,935			1,899,173			124,820
Policy charges		(2,523,473	)		0			(2,621,107	)		0
Benefit payments		(1,241,991	)		(431,205	)		(739,869	)		(398,313	)
Surrenders and withdrawals		(631,410	)		(424,184	)		(457,638	)		(387,164	)
Interest Credited		1,122,061			510,627			913,937			489,537

Balance, end of year	$	66,672,505		$	24,495,527		$	68,831,204		$	25,232,203

Weighted average crediting rate		4.45	%		4.01	%		4.42	%		4.02	%

Cash surrender value	$	52,444,020		$	24,481,427		$	54,616,725		$	25,215,411