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Investments

6 Months Ended

Jun. 30, 2025

Investments, Debt and Equity Securities [Abstract]

3)	Investments

The Company’s investments as of June 30, 2025 are summarized as follows:

Schedule of Investments

	Amortized Cost			Gross Unrealized Gains		Gross Unrealized Losses (1)			Allowance for Credit Losses			Estimated Fair Value
June 30, 2025:
Fixed maturity securities, available for sale, at estimated fair value:
U.S. Treasury securities and obligations of U.S. Government agencies	$	77,652,340		$	888,144	$	(247,044	)	$	-		$	78,293,440

Obligations of states and political subdivisions		3,550,803			15,484		(213,175	)		-			3,353,112

Corporate securities including public utilities		284,854,952			5,161,683		(4,397,245	)		(474,937	)		285,144,453

Mortgage-backed securities		26,532,070			119,743		(3,743,849	)		(12,049	)		22,895,915

Redeemable preferred stock		750,000			4,800		-			-			754,800

Total fixed maturity securities available for sale	$	393,340,165		$	6,189,854	$	(8,601,313	)	$	(486,986	)	$	390,441,720

Equity securities at estimated fair value:

Common stock:

Industrial, miscellaneous and all other	$	11,657,063		$	5,506,182	$	(606,714	)				$	16,556,531

Total equity securities at estimated fair value	$	11,657,063		$	5,506,182	$	(606,714	)				$	16,556,531

Mortgage loans held for investment at amortized cost:
Residential	$	92,656,929
Residential construction		165,707,402
Commercial		71,180,249
Less: Unamortized deferred loan fees, net		(2,230,234	)
Less: Allowance for credit losses		(2,640,744	)
Less: Net discounts		(269,606	)

Total mortgage loans held for investment	$	324,403,996

Real estate held for investment - net of accumulated depreciation:
Residential	$	88,976,901
Commercial		124,068,115

Total real estate held for investment	$	213,045,016

Real estate held for sale:
Residential	$	2,941,487
Commercial		151,553

Total real estate held for sale	$	3,093,040

Other investments and policy loans at amortized cost:
Policy loans	$	14,208,030
Insurance assignments		45,161,992
Federal Home Loan Bank stock (2)		1,324,800
Other investments		26,477,699
Less: Allowance for credit losses for insurance assignments		(1,481,032	)

Total other investments and policy loans	$	85,691,489

Accrued investment income	$	9,659,711

Total investments	$	1,042,891,503

(1)	Gross unrealized losses are net of allowance for credit losses
(2)	Includes $581,600 of Membership stock and $743,200 of Activity stock attributable to short-term borrowings and letters of credit.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

The Company’s investments as of December 31, 2024 are summarized as follows:

	Amortized Cost			Gross Unrealized Gains		Gross Unrealized Losses (1)			Allowance for Credit Losses			Estimated Fair Value
December 31, 2024:
Fixed maturity securities, available for sale, at estimated fair value:
U.S. Treasury securities and obligations of U.S. Government agencies	$	74,680,606		$	327,618	$	(486,976	)	$	-		$	74,521,248

Obligations of states and political subdivisions		6,416,751			1,762		(290,448	)		-			6,128,065

Corporate securities including public utilities		262,954,278			2,444,842		(6,922,871	)		(408,944	)		258,067,305

Mortgage-backed securities		31,710,436			125,764		(4,244,640	)		(12,049	)		27,579,511

Redeemable preferred stock		250,000			-		-			-			250,000

Total fixed maturity securities available for sale	$	376,012,071		$	2,899,986	$	(11,944,935	)	$	(420,993	)	$	366,546,129

Equity securities at estimated fair value:

Common stock:

Industrial, miscellaneous and all other	$	11,386,454		$	4,976,567	$	(591,340	)				$	15,771,681

Total equity securities at estimated fair value	$	11,386,454		$	4,976,567	$	(591,340	)				$	15,771,681

Mortgage loans held for investment at amortized cost:
Residential	$	92,061,787
Residential construction		151,172,733
Commercial		62,753,085
Less: Unamortized deferred loan fees, net		(2,082,241	)
Less: Allowance for credit losses		(1,885,390	)
Less: Net discounts		(272,616	)

Total mortgage loans held for investment	$	301,747,358

Real estate held for investment - net of accumulated depreciation:
Residential	$	71,618,410
Commercial		126,074,928

Total real estate held for investment	$	197,693,338

Real estate held for sale:
Residential	$	1,126,480
Commercial		151,553

Total real estate held for sale	$	1,278,033

Other investments and policy loans at amortized cost:
Policy loans	$	14,019,248
Insurance assignments		48,493,858
Federal Home Loan Bank stock (2)		2,404,900
Other investments		11,473,961
Less: Allowance for credit losses for insurance assignments		(1,536,926	)

Total policy loans and other investments	$	74,855,041

Accrued investment income	$	8,499,168

Total investments	$	966,390,748

(1)	Gross unrealized losses are net of allowance for credit losses
(2)	Includes $553,900 of Membership stock and $1,851,000 of Activity stock due to short-term advances and letters of credit.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

There were no investments in fixed maturity securities or equity securities, aggregated by issuer, of more than 10% of shareholders’ equity (before net unrealized gains and losses on equity securities and fixed maturity securities) as of June 30, 2025, other than investments issued or guaranteed by the United States Government.

Fixed Maturity Securities

The table below summarizes unrealized losses on fixed maturity securities available for sale that were carried at estimated fair value as of June 30, 2025 and December 31, 2024. The fair values of fixed maturity securities are based on quoted market prices, when available. For fixed maturity securities that are not actively traded, fair values are estimated using values obtained from independent pricing services, or in the case of private placements, are estimated by discounting expected future cash flows using a current market value applicable to the coupon rate, credit and maturity of the investments. The table below sets forth unrealized losses by duration with the fair value of the related fixed maturity securities.

	Unrealized Losses for Less than Twelve Months		Fair Value		Unrealized Losses for More than Twelve Months		Fair Value		Total Unrealized Loss		Combined Fair Value
June 30, 2025
U.S. Treasury securities and obligations of U.S. Government agencies	$	26,314	$	11,809,789	$	220,730	$	10,858,448	$	247,044	$	22,668,237
Obligations of states and political subdivisions		5,234		194,766		207,941		2,209,174		213,175		2,403,940
Corporate securities		572,966		38,970,717		3,824,279		71,639,210		4,397,245		110,609,927
Mortgage-backed securities		5,410		638,290		3,738,439		18,084,388		3,743,849		18,722,678
Totals	$	609,924	$	51,613,562	$	7,991,389	$	102,791,220	$	8,601,313	$	154,404,782

December 31, 2024
U.S. Treasury securities and obligations of U.S. Government agencies	$	8,737	$	986,365	$	478,239	$	22,110,495	$	486,976	$	23,096,860
Obligations of states and political subdivisions		15,003		2,167,918		275,445		3,008,385		290,448		5,176,303
Corporate securities including public utilities		1,888,022		93,562,219		5,034,849		77,975,776		6,922,871		171,537,995
Mortgage-backed securities		32,150		2,915,192		4,212,490		19,041,442		4,244,640		21,956,634
Totals	$	1,943,912	$	99,631,694	$	10,001,023	$	122,136,098	$	11,944,935	$	221,767,792

Relevant holdings were comprised of 477 securities with fair values aggregating 94.7% of the aggregate amortized cost as of June 30, 2025, compared to 706 securities with fair values aggregating 94.9% of the aggregate amortized cost as of December 31, 2024. A credit loss release of $20,313 and of $16,289 have been recognized for the three month periods ended June 30, 2025 and 2024, respectively. A credit loss provision of $65,993 and of $79,711 have been recognized for the six month periods ended June 30, 2025 and 2024, respectively. Credit losses are included in gains (losses) on investments and other assets on the condensed consolidated statements of earnings. Other unrealized losses for which no credit loss was recognized are primarily the result of increases in interest rates.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Evaluation of Allowance for Credit Losses

The Company evaluates its fixed maturity securities classified as available for sale on a quarterly basis to identify any potential credit losses. This evaluation includes a review of current ratings by the National Association of Insurance Commissions (“NAIC”) and other industry rating agencies. Securities with NAIC rating of 1 or 2 are considered investment grade and are only reviewed for credit loss if current market data or recent company news could lead to a credit downgrade. Securities with NAIC ratings of 3 to 5 are considered non-investment grade and are evaluated for credit loss. The evaluation involves assessing all facts and circumstances surrounding each security including, but not limited to, historical values, interest payment history, projected earnings, and revenue growth rates as well as a review of the reason for a downgrade in the NAIC rating. Based on the analysis of a security that is rated 3 to 5, a determination is made whether the security will likely make interest and principal payments in accordance with the terms of the financial instrument. Securities with a rating of 6 are automatically determined to be impaired and a credit loss is recognized in earnings.

Where the decline in fair value of fixed maturity securities is attributable to changes in market interest rates or to factors such as market volatility, liquidity and spread widening, and the Company anticipates recovery of all contractual or expected cash flows, the Company does not consider these securities to have credit loss because the Company does not intend to sell these securities and it is not more likely than not the Company will be required to sell these securities before a recovery of amortized cost, which may be at maturity.

If the Company intends to sell a fixed maturity security or if it is more likely than not that the Company will be required to sell a security before recovery of its amortized cost basis, a credit loss has occurred and the difference between the amortized cost and the fair value that relates to the expected credit loss is recognized as a loss in earnings, included in gains (losses) on investments and other assets on the condensed consolidated statements of earnings.

If the Company does not intend to sell a fixed maturity security and it is less likely than not that the Company will be required to sell the security but the Company also does not expect to recover the entire amortized cost basis of the security, a credit loss is recognized in earnings for the amount of the expected credit loss with a corresponding allowance for credit losses as a contra-asset account. The credit loss is included in gains (losses) on investments and other assets on the condensed consolidated statements of earnings. The recognized credit loss is limited to the total unrealized loss on the security due to a change in credit.

Amounts due on available for sale fixed maturities that are deemed to be uncollectible are written off and removed from the allowance for credit loss. A write-off may also occur if the Company intends to sell a security or when it is more likely than not that the Company will be required to sell the security before the recovery of its amortized cost.

The Company does not calculate a credit loss allowance on accrued interest income, included in accrued investment income on the condensed consolidated balance sheets, as the Company writes off any accrued interest income to net investment income if the accrued but unpaid amount exceeds 90 days.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Credit Quality Indicators

Based on the NAIC securities designations, the Company had 98.1% and 97.7% of its fixed maturity securities rated investment grade as of June 30, 2025 and December 31, 2024, respectively. The following table summarizes the credit quality, by NAIC designation, of the Company’s fixed maturity securities available for sale, excluding redeemable preferred stock.

		June 30, 2025				December 31, 2024
NAIC Designation		Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
	1	$	201,287,345	$	199,440,878	$	188,386,980	$	183,460,027
	2		183,343,661		182,932,186		178,060,265		174,405,442
	3		6,718,721		6,289,774		7,961,422		7,342,220
	4		530,927		521,810		649,592		600,459
	5		708,496		502,272		702,643		487,981
	6		1,015		-		1,169		-
	Total	$	392,590,165	$	389,686,920	$	375,762,071	$	366,296,129

The following tables present a roll forward of the Company’s allowance for credit losses on fixed maturity securities available for sale for the three month periods ended June 30, 2025 and 2024:


	Three Months Ended June 30, 2025
	U.S. Treasury securities and obligations of U.S. Government agencies		Obligations of states and political subdivisions		Corporate securities including public utilities			Mortgage-backed securities		Total

Beginning balance - March 31, 2025	$	-	$	-	$	495,251		$	12,049	$	507,300

Additions for credit losses not previously recorded		-		-		-			-		-
Change in allowance on securities with previous allowance		-		-		(20,444	)		-		(20,444	)
Reductions for securities sold during the period		-		-		-			-		-
Reductions for securities with credit losses due to intent to sell		-		-		-			-		-
Write-offs charged against the allowance		-		-		-			-		-
Recoveries of amounts previously written off		-		-		130			-		130

Ending Balance - June 30, 2025	$	-	$	-	$	474,937		$	12,049	$	486,986

	Three Months Ended June 30, 2024
	U.S. Treasury securities and obligations of U.S. Government agencies		Obligations of states and political subdivisions		Corporate securities including public utilities			Mortgage-backed securities		Total

Beginning balance - March 31, 2024	$	-	$	-	$	398,500		$	12,049	$	410,549

Additions for credit losses not previously recorded		-		-		-			-		-
Change in allowance on securities with previous allowance		-		-		(16,289	)		-		(16,289	)
Reductions for securities sold during the period		-		-		-			-		-
Reductions for securities with credit losses due to intent to sell		-		-		-			-		-
Write-offs charged against the allowance		-		-		-			-		-
Recoveries of amounts previously written off		-		-		-			-		-

Ending Balance - June 30, 2024	$	-	$	-	$	382,211		$	12,049	$	394,260

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

The following tables present a roll forward of the Company’s allowance for credit losses on fixed maturity securities available for sale for the six month periods ended June 30, 2025 and 2024:


	Six Months Ended June 30, 2025
	U.S. Treasury securities and obligations of U.S. Government agencies		Obligations of states and political subdivisions		Corporate securities including public utilities			Mortgage-backed securities		Total

Beginning balance - December 31, 2024	$	-	$	-	$	408,944		$	12,049	$	420,993

Additions for credit losses not previously recorded		-		-		72,000			-		72,000
Change in allowance on securities with previous allowance		-		-		(6,007	)		-		(6,007	)
Reductions for securities sold during the period		-		-		-			-		-
Reductions for securities with credit losses due to intent to sell		-		-		-			-		-
Write-offs charged against the allowance		-		-		-			-		-
Recoveries of amounts previously written off		-		-		-			-		-

Ending Balance - June 30, 2025	$	-	$	-	$	474,937		$	12,049	$	486,986


	Six Months Ended June 30, 2024
	U.S. Treasury securities and obligations of U.S. Government agencies		Obligations of states and political subdivisions		Corporate securities including public utilities		Mortgage-backed securities		Total

Beginning balance - December 31, 2023	$	-	$	-	$	308,500	$	6,049	$	314,549
Balance	$	-	$	-	$	308,500	$	6,049	$	314,549

Additions for credit losses not previously recorded		-		-		30,000		6,000		36,000
Change in allowance on securities with previous allowance		-		-		43,711		-		43,711
Reductions for securities sold during the period		-		-		-		-		-
Reductions for securities with credit losses due to intent to sell		-		-		-		-		-
Write-offs charged against the allowance		-		-		-		-		-
Recoveries of amounts previously written off		-		-		-		-		-

Ending Balance - June 30, 2024	$	-	$	-	$	382,211	$	12,049	$	394,260
Balance	$	-	$	-	$	382,211	$	12,049	$	394,260

The table below presents the amortized cost and the estimated fair value of fixed maturity securities available for sale as of June 30, 2025, by contractual maturity. Actual or expected maturities may differ from contractual maturities because certain securities afford the issuer the right to call or prepay its obligations.

	Amortized Cost		Estimated Fair Value
Due in 1 year	$	13,289,170	$	13,145,351
Due in 2-5 years		136,097,256		136,429,699
Due in 5-10 years		131,592,054		133,912,390
Due in more than 10 years		85,079,615		83,303,565
Mortgage-backed securities		26,532,070		22,895,915
Redeemable preferred stock		750,000		754,800
Total	$	393,340,165	$	390,441,720

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Information regarding sales of fixed maturity securities available for sale is presented as follows.


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Proceeds from sales	$	15,172		$	427,253		$	2,764,641		$	607,242
Gross realized gains		-			24,031			526			24,334
Gross realized losses		(711	)		(36,646	)		(542	)		(37,499	)

Assets on Deposit, Held in Trust, and Pledged as Collateral

Assets on deposit with life insurance regulatory authorities as required by law were as follows:

	As of June 30, 2025		As of December 31, 2024
Fixed maturity securities available for sale at estimated fair value	$	7,469,005	$	6,126,589
Other investments		424,543		400,000
Cash and cash equivalents		1,526,397		1,444,654
Total assets on deposit	$	9,419,945	$	7,971,243

Assets held in trust related to third-party reinsurance agreements were as follows:

	As of June 30, 2025		As of December 31, 2024
Fixed maturity securities available for sale at estimated fair value	$	25,814,271	$	25,309,270
Cash and cash equivalents		4,766,926		4,417,683
Total assets on deposit	$	30,581,197	$	29,726,953

The Company is a member of the Federal Home Loan Bank of Des Moines and Dallas (“FHLB”). Assets pledged as collateral with the FHLB are presented below. These pledged securities are used as collateral for any FHLB cash advances. As of June 30, 2025, the Company owed $15,000,000 to the FHLB for advances. The Company received $32,000,000 in advances and repaid $17,000,000 of these advances during the second quarter of 2025.

	As of June 30, 2025		As of December 31, 2024
Fixed maturity securities available for sale at estimated fair value	$	62,848,520	$	63,800,454
Total assets pledged as collateral	$	62,848,520	$	63,800,454

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Real Estate Held for Investment and Held for Sale

The Company strategically deploys resources into real estate assets to match the income and yield durations of its primary obligations. The sources for these real estate assets come through its various business units in the form of acquisition, development, and mortgage foreclosures.

Commercial Real Estate Held for Investment and Held for Sale

The Company owns, invests in and manages commercial real estate as a means of both generating investment income and providing workspace for its employees. This asset class is acquired in accordance with the Company’s goals and objectives for risk-adjusted returns. Due diligence is conducted on each asset using internal and third-party resources. The geographic locations and asset sub-classes of investments are determined by senior management under the direction of the Board of Directors.

The Company employs full-time employees to attend to the day-to-day operations of its commercial real estate within the greater Salt Lake area and close surrounding markets. The Company utilizes third party property managers where the geographic location does not warrant full-time staff or through strategic lease-up periods. The Company generally acquires commercial real estate in connection with company acquisitions or that are in regions expected to have high growth in employment and population and that provide operational efficiencies.

The Company currently owns and operates six commercial properties in two states. These properties include office buildings, flex office space, and the redevelopment and expansion of its corporate campus (“Center53”) in Salt Lake City, Utah. The Company uses bank debt in strategic cases, primarily where it is anticipated to improve yields, or facilitate the acquisition of higher quality assets or asset class diversification.

The aggregate net book value of commercial real estate serving as collateral for bank loans was $117,337,770 and $119,889,846 as of June 30, 2025 and December 31, 2024, respectively. The associated bank loan carrying values totaled $95,074,196 and $96,007,488 as of June 30, 2025 and December 31, 2024, respectively.

During the three and six month periods ended June 30, 2025 and 2024, the Company did not record any impairment losses on commercial real estate held for investment or held for sale. Impairment losses, if any, are included in gains (losses) on investment and other assets on the condensed consolidated statements of earnings.

During the three month periods ended June 30, 2025 and 2024, the Company recorded depreciation expense on commercial real estate held for investment of $1,432,921 and $1,418,301, respectively, and of $2,854,937 and $2,946,094 during the six month periods ended June 30, 2025 and 2024, respectively. Commercial real estate held for investment is stated at cost and is depreciated over the estimated useful life, primarily using the straight-line method. Depreciation is included in net investment income on the condensed consolidated statements of earnings.

The Company’s commercial real estate held for investment is summarized as follows as of the respective dates indicated:

	Net Book Value				Total Square Footage
	June 30, 2025		December 31, 2024		June 30, 2025		December 31, 2024
Utah (1)	$	124,049,860	$	126,056,342		546,941		546,941
Louisiana		18,255		18,586		1,622		1,622

	$	124,068,115	$	126,074,928		548,563		548,563

(1)	Includes Center53

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

The Company’s commercial real estate held for sale is summarized as follows as of the respective dates indicated:

	Net Book Value
	June 30, 2025		December 31, 2024
Mississippi (1)	$	151,553	$	151,553

	$	151,553	$	151,553

(1)	Consists of approximately 93 acres of undeveloped land

Commercial Real Estate Owned and Occupied by the Company

The primary business units of the Company occupy a portion of the real estate owned by the Company. As of June 30, 2025, real estate owned and occupied by the Company is summarized as follows:

Location	Business Segment	Approximate Square Footage		Square Footage Occupied by the Company
433 Ascension Way, Floors 4, 5 and 6, Salt Lake City, UT - Center53 Building 2 (1)	Corporate Offices, Life Insurance, Cemetery/Mortuary Operations, and Mortgage Operations and Sales		216,865		50	%
1818 Marshall Street, Shreveport, LA (2)	Life Insurance Operations		12,274		100	%
812 Sheppard Street, Minden, LA (2) (3)	Life Insurance Sales		1,560		100	%

(1)	Included in real estate held for investment on the condensed consolidated balance sheets
(2)	Included in property and equipment on the condensed consolidated balance sheets
(3)	Listed for sale

Residential Real Estate Held for Investment and Held for Sale

The Company occasionally acquires residential homes through the mortgage loan foreclosure process. The Company has the option to sell these properties or to continue to hold them for expected cash flow and price appreciation. The Company also looks for opportunities to acquire land that can be developed into single family lots. Once developed, finished lots are sold to builder partners and others.

During the three and six month periods ended June 30, 2025 and 2024 the Company did not record any impairment losses on residential real estate held for investment. Impairment losses, if any, are included in gains (losses) on investment and other assets on the condensed consolidated statements of earnings.

During the three month periods ended June 30, 2025 and 2024, the Company recorded depreciation expense on residential real estate held for investment of $2,732 and $2,653, respectively, and $5,408 and $5,305 during the six month periods ended June 30, 2025 and 2024, respectively. Residential real estate held for investment is stated at cost and is depreciated over the estimated useful life, primarily using the straight-line method. Depreciation is included in net investment income on the consolidated statements of earnings.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

The Company’s residential real estate held for investment is summarized as follows as of the respective dates indicated:

	Net Book Value
	June 30, 2025		December 31, 2024
Utah (1)	$	88,976,901	$	71,618,410
	$	88,976,901	$	71,618,410

(1)	Includes multiple residential subdivision development projects, refer to the following tables.

The Company also invests in residential subdivision developments. The following table presents additional information regarding the Company’s residential subdivision development projects in Utah:

	June 30, 2025		December 31, 2024
Lots developed		246		231
Lots to be developed		1,163		1,046
Book Value	$	88,807,255	$	71,443,356

The Company’s residential real estate held for sale is summarized as follows as of the respective dates indicated:

	Net Book Value
	June 30, 2025			December 31, 2024
Utah	$	2,561,487 (1	)	$	849,900
Florida		-			276,580
Georgia		380,000			-
	$	2,941,487		$	1,126,480

(1)	Includes a residential subdivision development project for $2,106,487

The net book value of foreclosed residential real estate included in residential real estate held for sale was $835,000 and $1,126,480 as of June 30, 2025 and December 31, 2024, respectively.

Mortgage Loans Held for Investment

Mortgage loans held for investment consist of first and second mortgages and are generally classified in three distinct group: Commercial, Residential and Residential Construction. These mortgage loans bear interest at rates ranging from 2.0% to 10.5%, maturity dates range from nine months to 30 years and have amortization periods of 0 to 30 years.

Concentrations of credit risk arise when a number of mortgage loan debtors have similar economic characteristics that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions. Although the Company has a diversified mortgage loan portfolio consisting of residential mortgages, commercial loans and residential construction loans and requires collateral on all real estate exposures, a substantial portion of the relevant debtors’ ability to honor obligations is dependent upon the economic stability of the geographic region in which the debtors do business or are employed. As of June 30, 2025, the Company had 57%, 8%, 6%, 5%, 4% and 4%, of its mortgage loans from borrowers located in the states of Utah, Florida, Arizona, California, Texas, and Hawaii, respectively. As of December 31, 2024, the Company had 56%, 8%, 9% and 6% of its mortgage loans from borrowers located in the states of Utah, Florida, Arizona, and Texas, respectively.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Mortgage loans held for investment are carried at their unpaid principal balances adjusted for net deferred fees, charge-offs, premiums, discounts, and the related allowance for credit losses. Interest income is included in net investment income on the condensed consolidated statements of earnings and is recognized when earned. The Company defers related material loan origination fees, net of related direct loan origination costs, and amortizes the net fees over the terms of the loans. Origination fees are included in net investment income on the condensed consolidated statements of earnings.

Mortgage loans are secured by the underlying property and require an appraisal at the time of underwriting and funding. Generally, the Company requires that loans not exceed 80% of the fair market value of the respective loan collateral. For loans of more than 80% of the fair market value of the respective loan collateral, additional collateral or mortgage insurance by an approved third-party insurer is required.

Evaluation of Allowance for Credit Losses

The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the Company’s mortgage loans held for investment to present the net amount expected to be collected. The Company reports in net earnings, as a credit loss expense, the amount necessary to adjust the allowance for credit losses for the Company’s current estimate of expected credit losses on mortgage loans held for investment. This credit loss expense is included in other expenses on the condensed consolidated statements of earnings.

Once a mortgage loan is past due 90 days, it is the policy of the Company to end the accrual of interest income on the loan and reverse any interest income that had been accrued. Given this policy, the Company does not measure a credit loss allowance on accrued interest receivable. Accrued interest receivable is included in accrued investment income on the condensed consolidated balance sheets. Payments received for mortgage loans on a non-accrual status are recognized when received. The interest income recognized from payments received for mortgage loans on a non-accrual status was immaterial. Accrual of interest resumes if a mortgage loan is brought current. Interest not accrued on these loans totaled approximately $343,000 and $244,000 as of June 30, 2025 and December 31, 2024, respectively.

The Company measures expected credit losses based on the fair value of the collateral when the Company determines that foreclosure is probable. When a mortgage loan becomes delinquent, the Company proceeds to foreclose and all expenses for foreclosure are expensed as incurred. Once foreclosed, the property is classified as real estate held for investment or held for sale.

To determine the allowance for credit losses, the Company has segmented its mortgage loans held for investment by loan type. The Company’s loan types are commercial, residential, and residential construction. The inherent risks within the portfolio vary depending upon the loan type as follows:

Commercial - Underwritten in accordance with the Company’s policies to determine the borrower’s ability to repay the obligation as agreed. Commercial loans are made primarily based on the underlying collateral supporting the loan. Accordingly, the repayment of a commercial loan depends primarily on the collateral and its ability to generate income and secondarily on the borrower’s (or guarantor’s) ability to repay.

Commercial loans are evaluated for credit loss by analyzing common metrics that are predictors for future credit losses such as debt service coverage ratio (“DSCR”), loan to value (“LTV”), local market conditions, borrower quality, and underlying collateral. The fair value of the underlying collateral is based on a third-party appraisal of the property at origination of the loan. The fair value is assessed if the loan becomes 90 days delinquent. The Company uses these metrics to pool similar loans. The allowance for credit losses is based on estimates, historical experience, probability of loss, value of the underlying collateral, and other factors that affect the collectability of the loan. The Company applies a future loss factor to the outstanding balance of each group to arrive at the allowance for credit losses.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Residential — These loans are secured by first and second mortgages on single-family dwellings. The borrower’s ability to repay is sensitive to the life events and the general economic condition of the region. Where loan to value exceeds 80%, the loan is generally guaranteed by private mortgage insurance, the FHA, or VA.

Residential loans are evaluated for credit loss by using relevant available information from both internal and external sources. Among other things, the Company uses its historical delinquency information and considers current and forecasted economic conditions. External sources include a monthly analysis of its residential portfolio by a third party. The third party uses the Company’s current loan data and runs it through various models to project cash flows and provide a projected life of loan loss. The models consider loan features such as loan type, loan to value, payment status, age, and current property values. Analyzing the information from the various sources allows the Company to arrive at the allowance for credit losses.

Residential construction (including land acquisition and development loans) – These loans are underwritten in accordance with the Company’s underwriting policies, which include a financial analysis of the builders, borrowers (guarantors), construction cost estimates, and independent appraisal valuations, and factor in estimates of the value of construction projects upon completion. Construction loans generally involve the disbursement of substantial funds over a short period of time with repayment substantially dependent upon the success of the completed project and the ability of the borrower to secure long-term financing.

Additionally, land acquisition and development loans are underwritten in accordance with the Company’s underwriting policies, which include independent appraisal valuations as well as the estimated value associated with the land upon completion of development into finished lots. These loans are of a higher risk than other mortgage loans due to their ultimate repayment being sensitive to general economic conditions, availability of long-term or construction financing, and interest rate sensitivity.

The Company advances funds in accordance with the loan agreements once the work has been completed and an independent inspection is made. The maximum loan commitment ranges between 50% and 85% of appraised value. The Company receives fees and interest for these loans and the interest rate is generally fixed at 5.25% to 8.50% per annum. Maturities range between six and eighteen months. The Company has commitments to fund existing construction and land development loans pursuant to the various loan agreements. As of June 30, 2025, the Company’s commitments were approximately $220,679,000 for these loans, of which $168,666,015 had been drawn.

Residential construction mortgage loans are evaluated for credit loss by considering historical activity and current housing market trends to arrive at a per loan basis point allowance that is recognized at loan origination and for subsequent draws. The per loan basis point is reviewed at least annually or as loan losses or market trends require.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

The following table presents a roll forward of the allowance for credit losses as of the dates indicated:

Schedule of Allowance for Loan Losses

	Three Months Ended
	Commercial			Residential			Residential Construction			Total
Beginning balance - March 31, 2025	$	1,021,730		$	647,107		$	339,755		$	2,008,592
Change in provision for credit losses (1)		157,537			482,785			(8,170	)		632,152
Charge-offs		-			-			-			-
Ending balance - June 30, 2025	$	1,179,267		$	1,129,892		$	331,585		$	2,640,744

Beginning balance - March 31, 2024	$	859,622		$	1,862,495		$	199,497		$	2,921,614
Change in provision for credit losses (1)		(10,299	)		(83,109	)		25,646			(67,762	)
Charge-offs		-			-			-			-
Ending balance - June 30, 2024	$	849,323		$	1,779,386		$	225,143		$	2,853,852

	Six Months Ended
	Commercial			Residential			Residential Construction		Total
Beginning balance - December 31, 2024	$	732,494		$	850,550		$	302,346	$	1,885,390
Change in provision for credit losses (1)		446,773			279,342			29,239		755,354
Charge-offs		-			-			-		-
Ending balance - June 30, 2025	$	1,179,267		$	1,129,892		$	331,585	$	2,640,744

Beginning balance - December 31, 2023	$	1,219,653		$	2,390,894		$	208,106	$	3,818,653
Change in provision for credit losses (1)		(370,330	)		(611,508	)		17,037		(964,801	)
Charge-offs		-			-			-		-
Ending balance - June 30, 2024	$	849,323		$	1,779,386		$	225,143	$	2,853,852

(1)	Included in other expenses on the condensed consolidated statements of earnings

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

The following table presents the aging of mortgage loans held for investment by loan type as of the dates indicated:

Schedule of Aging of Mortgage Loans

	Commercial			Residential			Residential Construction			Total
June 30, 2025
30-59 days past due	$	480,796		$	4,222,720		$	-		$	4,703,516
60-89 days past due		-			797,124			-			797,124
Over 90 days past due (1)		3,196,505			3,364,794			-			6,561,299
In process of foreclosure (1)		191,508			2,189,399			-			2,380,907
Total past due		3,868,809			10,574,037			-			14,442,846
Current		67,311,440			82,082,892			165,707,402			315,101,734
Total mortgage loans		71,180,249			92,656,929			165,707,402			329,544,580
Allowance for credit losses		(1,179,267	)		(1,129,892	)		(331,585	)		(2,640,744	)
Unamortized deferred loan fees, net		(258,313	)		(1,275,782	)		(696,139	)		(2,230,234	)
Unamortized discounts, net		(149,195	)		(120,411	)		-			(269,606	)
Net mortgage loans held for investment	$	69,593,474		$	90,130,844		$	164,679,678		$	324,403,996

December 31, 2024
30-59 days past due	$	2,100,000		$	5,818,334		$	-		$	7,918,334
60-89 days past due		-			845,980			-			845,980
Over 90 days past due (1)		4,205,000			3,061,450			-			7,266,450
In process of foreclosure (1)		191,508			3,942,392			-			4,133,900
Total past due		6,496,508			13,668,156			-			20,164,664
Current		56,256,577			78,393,631			151,172,733			285,822,941
Total mortgage loans		62,753,085			92,061,787			151,172,733			305,987,605
Allowance for credit losses		(732,494	)		(850,550	)		(302,346	)		(1,885,390	)
Unamortized deferred loan fees, net		(115,555	)		(1,307,539	)		(659,147	)		(2,082,241	)
Unamortized discounts, net		(149,268	)		(123,348	)		-			(272,616	)
Net mortgage loans held for investment	$	61,755,768		$	89,780,350		$	150,211,240		$	301,747,358

(1)	Interest income is not recognized on loans which are more than 90 days past due or in foreclosure.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Credit Quality Indicators

The Company evaluates and monitors the credit quality of its commercial loans by analyzing LTV and DSCR. Monitoring a commercial mortgage loan increases when the loan is delinquent or earlier if there is an indication of impairment.

The aggregate unpaid principal balance of commercial mortgage loans by credit quality indicator and origination year was as follows as of June 30, 2025:

Credit Quality Indicator	2025		2024		2023		2022		2021		Prior		Total		% of Total
LTV:
Less than 65%	$	17,393,534	$	3,893,127	$	15,600,000	$	462,761	$	837,745	$	8,576,170	$	46,763,337		65.70	%
65% to 80%		10,923,292		10,432,942		1,840,776		823,397		-		-		24,020,407		33.75	%
Greater than 80%		-		-		-		-		396,505		-		396,505		0.56	%

Total	$	28,316,826	$	14,326,069	$	17,440,776	$	1,286,158	$	1,234,250	$	8,576,170	$	71,180,249		100.00	%

DSCR
>1.20x	$	800,000	$	13,893,127	$	13,640,000	$	-	$	-	$	5,348,121	$	33,681,248		47.32	%
1.00x - 1.20x		27,516,826		432,942		3,800,776		1,286,158		1,234,250		3,228,049		37,499,001		52.68	%
<1.00x		-		-		-		-		-				-		0.00	%

Total	$	28,316,826	$	14,326,069	$	17,440,776	$	1,286,158	$	1,234,250	$	8,576,170	$	71,180,249		100.00	%

The aggregate unpaid principal balance of commercial mortgage loans by credit quality indicator and origination year was as follows as of December 31, 2024:

Credit Quality Indicator	2024		2023		2022		2021		2020		Prior		Total		% of Total
LTV:
Less than 65%	$	7,653,600	$	24,600,000	$	2,352,150	$	864,128	$	-	$	8,867,779	$	44,337,657		70.65	%
65% to 80%		10,432,942		1,840,776		823,397		-		4,913,313		-		18,010,428		28.70	%
Greater than 80%		-		-		-		405,000		-		-		405,000		0.65	%

Total	$	18,086,542	$	26,440,776	$	3,175,547	$	1,269,128	$	4,913,313	$	8,867,779	$	62,753,085		100.00	%

DSCR
>1.20x	$	16,300,000	$	20,990,000	$	1,000,000	$	-	$	4,913,313	$	5,414,274	$	48,617,587		77.47	%
1.00x - 1.20x		432,942		5,450,776		2,175,547		1,269,128		-		3,453,505		12,781,898		20.37	%
<1.00x		1,353,600		-		-		-		-		-		1,353,600		2.16	%

Total	$	18,086,542	$	26,440,776	$	3,175,547	$	1,269,128	$	4,913,313	$	8,867,779	$	62,753,085		100.00	%

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

The Company evaluates and monitors the credit quality of its residential mortgage loans by analyzing LTV and loan performance. The Company defines non-performing mortgage loans as loans more than 90 days past due and on a non-accrual status. Monitoring a residential mortgage loan increases when the loan is delinquent or earlier if there is an indication of impairment.

The aggregate unpaid principal balance of residential mortgage loans by credit quality indicator and origination year was as follows as of June 30, 2025:

Credit Quality Indicator	2025		2024		2023		2022		2021		Prior		Total		% of Total
Performance Indicators:
Performing	$	7,487,073	$	11,960,453	$	11,323,978	$	40,028,411	$	2,906,955	$	13,395,866	$	87,102,736		94.01	%
Non-performing (1)		547,079		553,091		1,932,504		1,050,561		-		1,470,958		5,554,193		5.99	%

Total	$	8,034,152	$	12,513,544	$	13,256,482	$	41,078,972	$	2,906,955	$	14,866,824	$	92,656,929		100.00	%

(1)	Includes residential mortgage loans in the process of foreclosure of $2,189,399

LTV:
Less than 65%	$	4,375,611	$	5,643,851	$	4,748,950	$	5,470,866	$	1,342,891	$	6,918,135	$	28,500,304	30.76	%
65% to 80%		3,219,478		6,057,761		7,634,155		34,527,759		1,564,064		6,810,313		59,813,530	64.55	%
Greater than 80%		439,063		811,932		873,377		1,080,347		-		1,138,376		4,343,095	4.69	%

Total	$	8,034,152	$	12,513,544	$	13,256,482	$	41,078,972	$	2,906,955	$	14,866,824	$	92,656,929	100.00	%

The aggregate unpaid principal balance of residential mortgage loans by credit quality indicator and origination year was as follows as of December 31, 2024:

Credit Quality Indicator	2024		2023		2022		2021		2020		Prior		Total		% of Total
Performance Indicators:
Performing	$	14,861,098	$	10,030,848	$	42,634,670	$	3,076,901	$	5,513,462	$	8,940,966	$	85,057,945		92.39	%
Non-performing (1)		-		3,442,992		1,451,039		291,359		311,116		1,507,336		7,003,842		7.61	%

Total	$	14,861,098	$	13,473,840	$	44,085,709	$	3,368,260	$	5,824,578	$	10,448,302	$	92,061,787		100.00	%

(1)	Includes residential mortgage loans in the process of foreclosure of $3,942,392

	Year 1		Year 2		Year 3		Year 4		Year 5
LTV:
Less than 65%	$	6,241,730	$	4,931,376	$	5,488,954	$	1,790,036	$	2,440,002	$	5,273,672	$	26,165,770	28.42	%
65% to 80%		7,802,984		7,662,200		37,509,634		1,578,224		2,701,008		5,107,289		62,361,339	67.74	%
Greater than 80%		816,384		880,264		1,087,121		-		683,568		67,341		3,534,678	3.84	%

Total	$	14,861,098	$	13,473,840	$	44,085,709	$	3,368,260	$	5,824,578	$	10,448,302	$	92,061,787	100.00	%

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

The Company evaluates and monitors the credit quality of its residential construction loans (including land acquisition and development loans) by analyzing LTV and loan performance. Monitoring a residential construction mortgage loan increases when the loan is delinquent or earlier if there is an indication of impairment.

The aggregate unpaid principal balance of residential construction mortgage loans by credit quality indicator and origination year was as follows as of June 30, 2025:

Credit Quality Indicator	2025		2024		2023		2022		2021		Total		% of Total
Performance Indicators:
Performing	$	71,979,788	$	78,444,285	$	10,507,327	$	-	$	4,776,002	$	165,707,402		100.00	%
Non-performing		-		-		-		-		-		-		0.00	%

Total	$	71,979,788	$	78,444,285	$	10,507,327	$	-	$	4,776,002	$	165,707,402		100.00	%

LTV:
Less than 65%	$	16,441,043	$	38,732,904	$	10,507,327	$	-	$	4,776,002	$	70,457,276		42.52	%
65% to 80%		55,538,745		39,711,381		-		-		-		95,250,126		57.48	%
Greater than 80%		-		-		-		-		-		-		0.00	%

Total	$	71,979,788	$	78,444,285	$	10,507,327	$	-	$	4,776,002	$	165,707,402		100.00	%

The aggregate unpaid principal balance of residential construction mortgage loans by credit quality indicator and origination year was as follows as of December 31, 2024:

Credit Quality Indicator	2024		2023		2022		2021		Total		% of Total
Performance Indicators:
Performing	$	118,863,944	$	21,375,552	$	972,468	$	9,960,769	$	151,172,733		100.00	%
Non-performing		-		-		-		-		-		0.00	%

Total	$	118,863,944	$	21,375,552	$	972,468	$	9,960,769	$	151,172,733		100.00	%

LTV:
Less than 65%	$	48,065,177	$	21,375,552	$	518,590	$	9,960,769	$	79,920,088		52.87	%
65% to 80%		70,798,767		-		453,878		-		71,252,645		47.13	%
Greater than 80%				-		-		-		-		0.00	%

Total	$	118,863,944	$	21,375,552	$	972,468	$	9,960,769	$	151,172,733		100.00	%

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Insurance Assignments

The following table presents the aging of insurance assignments, included in other investments and policy loans on the condensed consolidated balance sheets:

	As of June 30, 2025			As of December 31, 2024
30-59 days past due	$	8,039,317		$	8,785,184
60-89 days past due		3,552,546			4,046,731
Over 90 days past due		5,151,594			5,320,216
Total past due		16,743,457			18,152,131
Current		28,418,535			30,341,727
Total insurance assignments		45,161,992			48,493,858
Allowance for credit losses		(1,481,032	)		(1,536,926	)
Net insurance assignments	$	43,680,960		$	46,956,932

The Company records an allowance for credit losses when the insurance assignment is funded. Once an insurance assignment moves to 90 days past due or legal proceedings, it is monitored for write-off and collectability, and any adjustments to the allowance are recorded at that time.

The following table presents a roll forward of the allowance for credit losses for insurance assignments as of the dates indicated:

Schedule of Allowance for Credit Losses

	Three Months Ended
Beginning balance - March 31, 2025	$	1,517,783
Change in provision for credit losses (1)		257,253
Charge-offs		(294,004	)
Ending balance - June 30, 2025	$	1,481,032

Beginning balance - March 31, 2024	$	1,587,525
Change in provision for credit losses (1)		242,046
Charge-offs		(294,247	)
Ending balance - June 30, 2024	$	1,535,324

	Six Months Ended
Beginning balance - December 31, 2024	$	1,536,926
Change in provision for credit losses (1)		551,051
Charge-offs		(606,945	)
Ending balance - June 30, 2025	$	1,481,032

Beginning balance - December 31, 2023	$	1,553,836
Change in provision for credit losses (1)		492,613
Charge-offs		(511,125	)
Ending balance - June 30, 2024	$	1,535,324

(1)	Included in other expenses on the condensed consolidated statements of earnings

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Variable Interest Entities (“VIE”)

The Company has a 50% ownership interest in HHH Real Estate LLC (“HHH”), an entity that holds and develops single family lots for residential construction. In accordance with the HHH operating agreement, net profits or losses are allocated to the members in accordance with their ownership interests. The investment in HHH is accounted for under the equity method of accounting. HHH has not commenced its principal operations as of June 30, 2025. The carrying value of the equity investment in HHH was $11,163,125 and nil at June 30, 2025 and December 31, 2024, respectively, which is included in other investments and policy loans on the condensed consolidated balance sheets.

The Company has determined that HHH is a VIE for the following reasons: (1) the at-risk equity holders, as a group, lack the characteristics of a controlling financial interest. (2) the General Manager directs the activities and legal operations that most significantly affect the entity’s economic performance and (3) the Company does not have majority voting rights and no power to unilaterally direct the activities of the entity, and therefore, is not the primary beneficiary. The Company’s exposure to loss because of its involvement with the equity method investee is limited to the carrying value of the Company’s investment of $11,163,125.

Investment Related Earnings

The following table presents the realized gains and losses from sales, calls, and maturities, and unrealized gains and losses on equity securities from investments and other assets:

Schedule of Gain (Loss) on Investments


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Fixed maturity securities:
Gross realized gains	$	453		$	24,031		$	1,521		$	24,334
Gross realized losses		30,029			(36,646	)		(12,257	)		(37,499	)
Net credit loss provision		20,313			16,289			(65,993	)		(79,711	)

Equity securities:
Gains (losses) on securities sold		15,981			43,733			130,108			(17,370	)
Unrealized gains on securities held at the end of the period		793,404			(424,455	)		1,066,880			1,118,405

Real estate held for investment and sale:
Gross realized gains		202,389			38,890			596,915			288,852
Gross realized losses		-			-			-			(39,081	)

Other assets:
Gross realized gains		81,867			-			88,392			35,486
Gross realized losses		(1,729	)		(39,081	)		(76,838	)		(1,229	)
Total	$	1,142,707		$	(377,239	)	$	1,728,728		$	1,292,187

The realized gains and losses on the sale of securities are recorded on the trade date, and the cost of the securities sold is determined using the specific identification method.

Net realized gains and losses includes gains and losses from cemetery perpetual care trust investments and the restricted assets of cemeteries and mortuaries and totaled $271,176 and $202,800 in net gains for the three month periods ended June 30, 2025 and 2024, respectively, and of $485,155 and $379,363 in net gains for the six month periods ended June 30, 2025 and 2024, respectively.

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)

3)	Investments (Continued)

Major categories of net investment income were as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Fixed maturity securities available for sale	$	4,749,965		$	4,345,704		$	9,414,798		$	8,749,262
Equity securities		247,633			176,448			440,263			344,596
Mortgage loans held for investment		12,457,357			7,021,559			20,421,897			15,835,595
Real estate held for investment and sale		2,872,566			3,285,019			5,832,278			6,800,080
Policy loans		235,758			189,131			480,363			490,398
Insurance assignments		5,138,214			4,886,015			10,870,365			9,962,563
Other investments		82,349			201,342			243,835			400,301
Cash and cash equivalents		953,618			1,715,910			2,356,252			3,406,867
Gross investment income		26,737,460			21,821,128			50,060,051			45,989,662
Investment expenses		(6,156,472	)		(3,776,320	)		(10,276,439	)		(7,998,286	)
Net investment income	$	20,580,988		$	18,044,808		$	39,783,612		$	37,991,376

Net investment income includes income earned from cemetery perpetual care trust investments and the restricted assets of cemeteries and mortuaries and totaled $220,634 and $470,808 for the three month periods ended June 30, 2025 and 2024, respectively, and $367,472 and $1,404,359 for the six month periods ended June 30, 2025 and 2024, respectively.

Net investment income on real estate consists primarily of rental revenue. Investment expenses consist primarily of depreciation, property taxes, operating expenses of real estate and an estimated portion of administrative expenses relating to investment activities.

Accrued Investment Income

Accrued investment income consists of the following:

Schedule of Accrued Investment Income

	As of June 30, 2025		As of December 31, 2024
Fixed maturity securities available for sale	$	4,149,857	$	3,795,581
Equity securities		10,000		11,049
Mortgage loans held for investment		1,211,558		1,049,489
Real estate held for investment		4,229,979		3,559,463
Other investments		30,917		-
Cash and cash equivalents		27,400		83,586
Total accrued investment income	$	9,659,711	$	8,499,168

SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 (Unaudited)