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Schedule II - Condensed Financial Information Of Registrant | 12 Months Ended
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Dec. 31, 2018
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] |
Condensed Financial Information of Registrant | Schedule II Condensed Financial Information of Registrant PRIMERICA, INC. (Parent Only) Condensed Balance Sheets
|  | December 31, |
|  | 2018 |  |  | 2017 |
|  | (In thousands) |
Assets |  |  |  |  |  |  |  |
Investments: |  |  |  |  |  |  |  |
Fixed-maturity securities available-for-sale, at fair value (amortized cost: $108,623 in 2018 and $42,812 in 2017) |  | $ | 109,415 |  |  | $ | 44,405 |
Short-term investments, at fair value (amortized cost: $8,171 in 2018 and $0 in 2017) |  |  | 8,171 |  |  |  | - |
Equity securities, at fair value (historical cost: $1,519 in 2018 and $0 in 2017) |  |  | 1,447 |  |  |  | - |
Trading securities, at fair value (cost: $0 in 2018 and $1,371 in 2017) |  |  | - |  |  |  | 1,428 |
Total investments |  |  | 119,033 |  |  |  | 45,833 |
Cash and cash equivalents |  |  | 32,745 |  |  |  | 66,226 |
Due from affiliates* |  |  | 2,492 |  |  |  | 3,272 |
Other receivables |  |  | 1,086 |  |  |  | 438 |
Income tax receivable |  |  | 3,490 |  |  |  | - |
Deferred income taxes |  |  | 12,151 |  |  |  | 12,151 |
Investment in subsidiaries* |  |  | 1,678,231 |  |  |  | 1,683,149 |
Other assets |  |  | 729 |  |  |  | 915 |
Total assets |  | $ | 1,849,957 |  |  | $ | 1,811,984 |
Liabilities and Stockholders’ Equity |  |  |  |  |  |  |  |
Liabilities: |  |  |  |  |  |  |  |
Notes payable |  | $ | 373,661 |  |  | $ | 373,288 |
Current income tax payable |  |  | - |  |  |  | 6,628 |
Deferred income taxes |  |  | 6,126 |  |  |  | 4,311 |
Interest payable |  |  | 8,214 |  |  |  | 8,214 |
Other liabilities |  |  | 443 |  |  |  | 442 |
Commitments and contingent liabilities (see Note E) |  |  |  |  |  |  |  |
Total liabilities |  |  | 388,444 |  |  |  | 392,883 |
Stockholders’ equity: |  |  |  |  |  |  |  |
Common stock ($0.01 par value; authorized 500,000 in 2018 and 2017; issued and outstanding 42,694 shares in 2018 and 44,251 shares in 2017) |  |  | 427 |  |  |  | 443 |
Paid-in capital |  |  | - |  |  |  | - |
Retained earnings |  |  | 1,489,520 |  |  |  | 1,375,090 |
Accumulated other comprehensive income, net of income tax |  |  | (28,434 | ) |  |  | 43,568 |
Total stockholders’ equity |  |  | 1,461,513 |  |  |  | 1,419,101 |
Total liabilities and stockholders’ equity |  | $ | 1,849,957 |  |  | $ | 1,811,984 |
* | Eliminated in consolidation.
See the accompanying notes to condensed financial statements. See the report of independent registered public accounting firm. Schedule II Condensed Financial Information of Registrant PRIMERICA, INC. (Parent Only) Condensed Statements of Income
|  | Year ended December 31, |
|  | 2018 |  |  | 2017 |  |  | 2016 |
|  | (In thousands) |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |
Dividends from subsidiaries* |  | $ | 302,932 |  |  | $ | 256,913 |  |  | $ | 189,582 |
Net investment income |  |  | 2,306 |  |  |  | 1,484 |  |  |  | 1,695 |
Realized investment gains (losses), including other-than-temporary impairment losses |  |  | (128 | ) |  |  | 179 |  |  |  | 1,088 |
Total revenues |  |  | 305,110 |  |  |  | 258,576 |  |  |  | 192,365 |
Expenses: |  |  |  |  |  |  |  |  |  |  |  |
Interest expense |  |  | 18,695 |  |  |  | 18,210 |  |  |  | 18,180 |
Other operating expenses |  |  | 7,478 |  |  |  | 8,441 |  |  |  | 12,433 |
Total expenses |  |  | 26,173 |  |  |  | 26,651 |  |  |  | 30,613 |
Income before income taxes |  |  | 278,937 |  |  |  | 231,925 |  |  |  | 161,752 |
Income taxes |  |  | (5,578 | ) |  |  | (3,756 | ) |  |  | (7,019 | )
Income (loss) before equity in undistributed earnings of subsidiaries |  |  | 284,515 |  |  |  | 235,681 |  |  |  | 168,771 |
Equity in undistributed earnings of subsidiaries* |  |  | 39,579 |  |  |  | 114,574 |  |  |  | 50,643 |
Net income |  | $ | 324,094 |  |  | $ | 350,255 |  |  | $ | 219,414 |
* | Eliminated in consolidation.
See the accompanying notes to condensed financial statements. See the report of independent registered public accounting firm. Schedule II Condensed Financial Information of Registrant PRIMERICA, INC. (Parent Only) Condensed Statements of Comprehensive Income
|  | Year ended December 31, |
|  | 2018 |  |  | 2017 |  |  | 2016 |
|  | (In thousands) |
Net income |  | $ | 324,094 |  |  | $ | 350,255 |  |  | $ | 219,414 |
Other comprehensive income (loss) before income taxes: |  |  |  |  |  |  |  |  |  |  |  |
Unrealized investment gains (losses): |  |  |  |  |  |  |  |  |  |  |  |
Equity in unrealized holding gains (losses) on investment securities held by subsidiaries |  |  | (46,382 | ) |  |  | (3,333 | ) |  |  | 9,846 |
Change in unrealized holding gains/(losses) on investment securities |  |  | (931 | ) |  |  | 356 |  |  |  | 2,487 |
Reclassification adjustment for realized investment (gains) losses included in net income |  |  | 128 |  |  |  | (179 | ) |  |  | (1,088 | )
Foreign currency translation adjustments: |  |  |  |  |  |  |  |  |  |  |  |
Equity in unrealized foreign currency translation gains of subsidiaries |  |  | (25,059 | ) |  |  | 17,383 |  |  |  | 6,689 |
Total other comprehensive income (loss) before income taxes |  |  | (72,244 | ) |  |  | 14,227 |  |  |  | 17,934 |
Income tax expense (benefit) related to items of other comprehensive income (loss) |  |  | (169 | ) |  |  | 257 |  |  |  | 571 |
Other comprehensive income (loss), net of income taxes |  |  | (72,075 | ) |  |  | 13,970 |  |  |  | 17,363 |
Total comprehensive income |  | $ | 252,019 |  |  | $ | 364,225 |  |  | $ | 236,777 |
See the accompanying notes to condensed financial statements. See the report of independent registered public accounting firm. Schedule II Condensed Financial Information of Registrant PRIMERICA, INC. (Parent Only) Condensed Statements of Cash Flows
|  | Year ended December 31, |  |
|  | 2018 |  |  | 2017 |  |  | 2016 |  |
|  | (In thousands) |  |
Cash flows from operating activities: |  |  |  |  |  |  |  |  |  |  |  |  |
Net income |  | $ | 324,094 |  |  | $ | 350,255 |  |  | $ | 219,414 |  |
Adjustments to reconcile net income to cash provided by (used in) operating activities: |  |  |  |  |  |  |  |  |  |  |  |  |
Equity in undistributed earnings of subsidiaries* (1) |  |  | (44,095 | ) |  |  | (145,113 | ) |  |  | (89,820 | ) |
Deferred tax provision |  |  | (1,983 | ) |  |  | 2,454 |  |  |  | 167 |  |
Change in income taxes |  |  | (6,151 | ) |  |  | (1,235 | ) |  |  | (523 | ) |
Realized investment (gains) losses, including other-than-temporary impairments |  |  | 128 |  |  |  | (179 | ) |  |  | (1,088 | ) |
Accretion and amortization of investments |  |  | 103 |  |  |  | 149 |  |  |  | (118 | ) |
Share-based compensation |  |  | 1,365 |  |  |  | 1,254 |  |  |  | 1,227 |  |
Change in due to/from affiliates* |  |  | 780 |  |  |  | (4,380 | ) |  |  | (2,671 | ) |
Trading securities sold, matured, or called (acquired), net |  |  | - |  |  |  | (1,377 | ) |  |  | (51 | ) |
Change in other operating assets and liabilities, net |  |  | (120 | ) |  |  | (1,514 | ) |  |  | 555 |  |
Net cash provided by (used in) operating activities |  |  | 274,121 |  |  |  | 200,314 |  |  |  | 127,092 |  |
Cash flows from investing activities: |  |  |  |  |  |  |  |  |  |  |  |  |
Available-for-sale investments sold, matured or called: |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed maturity securities — sold |  |  | 1,603 |  |  |  | 12,204 |  |  |  | 29,759 |  |
Fixed-maturity securities — matured or called |  |  | 104,836 |  |  |  | 56,678 |  |  |  | 79,914 |  |
Equity securities - sold |  |  | - |  |  |  | 36 |  |  |  | - |  |
Equity securities sold |  |  | 150 |  |  |  | - |  |  |  | - |  |
Available-for-sale investments acquired: |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed-maturity securities(1) |  |  | (144,760 | ) |  |  | (23,497 | ) |  |  | (50,408 | ) |
Equity securities |  |  | - |  |  |  | (40 | ) |  |  | - |  |
Short-term investments |  |  | (8,169 | ) |  |  | - |  |  |  | - |  |
Equity Securities acquired |  |  | (265 | ) |  |  | - |  |  |  | - |  |
Net cash provided by (used in) investing activities |  |  | (46,605 | ) |  |  | 45,381 |  |  |  | 59,265 |  |
Cash flows from financing activities: |  |  |  |  |  |  |  |  |  |  |  |  |
Dividends paid |  |  | (44,140 | ) |  |  | (35,821 | ) |  |  | (33,367 | ) |
Common stock repurchased |  |  | (210,146 | ) |  |  | (150,038 | ) |  |  | (150,057 | ) |
Tax withholdings on share-based compensation |  |  | (6,711 | ) |  |  | (6,734 | ) |  |  | (3,970 | ) |
Payment of deferred financing costs |  |  | - |  |  |  | (868 | ) |  |  | - |  |
Net cash provided by (used) in financing activities |  |  | (260,997 | ) |  |  | (193,461 | ) |  |  | (187,394 | ) |
Change in cash and cash equivalents |  |  | (33,481 | ) |  |  | 52,234 |  |  |  | (1,037 | ) |
Cash and cash equivalents, beginning of period |  |  | 66,226 |  |  |  | 13,992 |  |  |  | 15,029 |  |
Cash and cash equivalents, end of period |  | $ | 32,745 |  |  | $ | 66,226 |  |  | $ | 13,992 |  |
Supplemental disclosures of cash flow information: |  |  |  |  |  |  |  |  |  |  |  |  |
Interest paid |  | $ | 18,146 |  |  | $ | 17,813 |  |  | $ | 17,813 |  |
* | Eliminated in consolidation.
(1) | Does not include $27.6 million, $35.5 million, and $39.2 million of fixed-maturity securities transferred from subsidiaries in the form of noncash dividends for the years ended December 31, 2018, 2017 and 2016, respectively.
See the accompanying notes to condensed financial statements. See the report of independent registered public accounting firm. Schedule II Condensed Financial Information of Registrant PRIMERICA, INC. (Parent Only) Notes to Condensed Financial Statements (A) Description of Business Primerica, Inc. (“we”, “us” or the “Company”) is a holding company with our primary asset being the capital stock of our wholly owned operating subsidiaries, and our primary liability being $375.0 million in principal amount of senior unsecured notes issued in a public offering in 2012 (the “Senior Notes”). Our subsidiaries assist clients in meeting their needs for term life insurance, which our insurance subsidiaries underwrite, and mutual funds, annuities, managed investments and other financial products, which our subsidiaries distribute primarily on behalf of third parties. Our primary subsidiaries include the following entities: Primerica Financial Services, LLC, a general agency and marketing company; Primerica Life Insurance Company ("Primerica Life"), our principal life insurance company; PFS Investments Inc., an investment products company and broker-dealer; and Primerica Financial Services (Canada) Ltd., a holding company for our Canadian operations, which includes Primerica Life Insurance Company of Canada and PFSL Investments Canada Ltd. Primerica Life, domiciled in Tennessee, owns National Benefit Life Insurance Company, a New York insurance company. In addition, we established Peach Re, Inc. ("Peach Re") and Vidalia Re, Inc. (“Vidalia Re”) as special purpose financial captive insurance companies domiciled in Vermont and wholly owned subsidiaries of Primerica Life. (B) Basis of Presentation These condensed financial statements reflect the results of operations, financial position and cash flows for the Company. 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 that affect financial statement balances, revenues and expenses and cash flows, as well as the disclosure of contingent assets and liabilities. Management considers available facts and knowledge of existing circumstances when establishing the estimates included in our financial statements. The most significant item that involves a greater degree of accounting estimates subject to change in the future is the determination of our investments in subsidiaries. Estimates for this and other items are subject to change and are reassessed by management in accordance with U.S. GAAP. Actual results could differ from those estimates. The accompanying condensed financial statements should be read in conjunction with the consolidated financial statements and notes thereto of Primerica, Inc. and subsidiaries included in Part II, Item 8 of this report. (C) Note Payable In July 2012, we issued the Senior Notes in a public offering at a price of 99.843% of the principal amount with an annual interest rate of 4.75%, payable semi-annually in arrears on January 15 and July 15. The Senior Notes mature on July 15, 2022. As unsecured senior obligations, the Senior Notes rank equally in right of payment with all existing and future unsubordinated indebtedness and senior to all existing and future subordinated indebtedness of the Company. The Senior Notes are structurally subordinated in right of payment to all existing and future liabilities of our subsidiaries. In addition, the Senior Notes contain covenants that restrict our ability to, among other things, create or incur any indebtedness that is secured by a lien on the capital stock of certain of our subsidiaries, and merge, consolidate or sell all or substantially all of our properties and assets. We were in compliance with the covenants of the Senior Notes at December 31, 2018. No events of default occurred on the Senior Notes during the year ended December 31, 2018. (D) Revolving Credit Facility We maintain an unsecured $200.0 million revolving credit facility ("Revolving Credit Facility") with a syndicate of commercial banks that has a scheduled termination date of December 19, 2022. Amounts outstanding under the Revolving Credit Facility bear interest at a periodic rate equal to LIBOR 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 LIBOR rate loans and letters of credit ranging from 1.125% to 1.625% per annum and for base rate loans ranging from 0.125% 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 0.125% to 0.225% per annum of the aggregate $200.0 million commitment of the lenders under the Revolving Credit Facility. As of December 31, 2018, no amounts have been drawn under the Revolving Credit Facility and we were in compliance with its covenants. Furthermore, no events of default have occurred under the Revolving Credit Facility during the year ended December 31, 2018. (E) Dividends For the years ended December 31, 2018, 2017, and 2016, the Company received dividends from our non-life insurance subsidiaries of approximately $80.1 million, $96.0 million, and $72.5 million, respectively. For the years ended December 31, 2018, 2017, and 2016, the Company received dividends from our life insurance subsidiaries of approximately $222.8 million, $160.9 million, and $117.0 million, respectively. (F) Commitments and Contingent Liabilities Peach Re and Vidalia Re have each entered into separate coinsurance agreements with Primerica Life whereby Primerica Life has ceded certain level-premium term life insurance policies to Peach Re and Vidalia Re. In conjunction with these coinsurance agreements, we have capital maintenance agreements with both Peach Re and Vidalia Re. Each capital maintenance agreement may require us at times to make capital contributions to Peach Re and Vidalia Re to ensure that their regulatory accounts, as defined in the coinsurance agreements with Primerica Life, will not be less than $20.0 million for each financial captive insurance company. For Peach Re, the regulatory account will only be used to satisfy obligations under its coinsurance agreement after all other available assets have been used, including a letter of credit issued by Deutsche Bank for the benefit of Primerica Life. For Vidalia Re, the regulatory account will only be used to satisfy obligations under its coinsurance agreement after all other available assets have been used, including its held-to-maturity security ultimately guaranteed by Hannover Life Reassurance Company of America. The Company is involved from time to time in legal disputes, regulatory inquiries and arbitration proceedings in the normal course of business. These disputes are subject to uncertainties, including large and/or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation. As such, the Company is unable to estimate the possible loss or range of loss that may result from these matters.

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- Definition The entire disclosure for condensed financial information, including the financial position, cash flows, and the results of operations of the registrant (parent company) as of the same dates or for the same periods for which audited consolidated financial statements are being presented. Alternatively, the details of this disclosure can be reported by the specific parent company taxonomy elements, indicating the appropriate date and period contexts in an instance document. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 45 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=108774443&loc=d3e5283-111683 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 235 -Section S99 -Paragraph 2 -Subparagraph (SX 210.9-06) -URI http://asc.fasb.org/extlink&oid=6882215&loc=d3e537971-122884 + Details
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