An increase in death benefits led to a 12 percent third quarter net income loss at FBL Financial Group Inc., the West Des Moines, Iowa-based owner of Farm Bureau Life Insurance. Company officials cited the increase in death benefits as the primary reason third-quarter net income dropped to $26.7 million compared with the year-ago period.
Death benefits, net of reinsurance and reserves released to pay for the benefits, increased to $26.9 million from $20.6 million in the year-ago period. This was due to an increase in the number of claims and the lower reinsurance received on those claims, the company also said.
“We've had success with strategies to increase our exclusive agent count and manage spreads in the continued low interest rate environment,” James P. Brannen, CEO of FBL Financial Group, said in a news release. “These strategies, combined with effective capital and expense management, produced another quarter of strong results."
Third quarter “premiums collected,” an industry measure of agent productivity, rose to $184 million compared to $149.4 million in the year-ago period, the company also said.
Annuity premiums collected rose 50 percent to $102 million compared with the year-ago quarter. This was boosted by short-term annuity products in the form of fixed rate deferred annuities, the company said.
Life premiums collected net of reinsurance increased 1 percent to $68.1 million compared to the year-ago period.
Net income per share diluted was $1.06, the company said.
The company also reported third quarter operating income of $27.3 million, or $1.09 per share diluted, compared with $29.5 million, or $1.18 per share diluted in the year-ago period.
Third quarter revenue rose to $175.5 million from $173.4 million in the year-ago period, the company said.
Farm Bureau Life has 1,786 exclusive agents and agency managers operating in 14 Midwestern and Western states. In addition, 9 exclusive agents and agency managers work for Greenfields Life in Colorado, a wholly-owned subsidiary of Farm Bureau Life.
InsuranceNewsNet Senior Writer Cyril Tuohy has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected].
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