Item 1. Condensed Consolidated Financial Statements

244K characters. Original on sec.gov · Markdown

Item 1. Condensed Consolidated Financial Statements

Globe Life Inc.

Condensed Consolidated Balance Sheets

(Unaudited)



	March 31, 2024		December 31, 2023
Assets:
Investments:
Fixed maturities—available for sale, at fair value (amortized cost: 2024—$19,504,784; 2023—$18,924,914, allowance for credit losses: 2024— $7,027; 2023— $7,115)	$	18,144,353	$	17,870,206
Mortgage loans	329,033		279,199
Policy loans	664,641		657,020
Other long-term investments (includes: 2024—$844,916; 2023—$795,583 under the fair value option)	899,085		835,878
Short-term investments	58,413		81,740
Total investments	20,095,525		19,724,043
Cash	83,547		103,156
Accrued investment income	299,398		270,396
Other receivables	645,966		630,223
Deferred acquisition costs	6,131,237		6,009,477
Goodwill	481,791		481,791
Other assets	833,129		832,413
Total assets	$	28,570,593	$	28,051,499
Liabilities:
Future policy benefits at current discount rates: (at original rates: 2024—$17,110,880; 2023—$16,984,615)	$	18,882,023	$	19,460,353
Unearned and advance premium	270,105		254,567
Policy claims and other benefits payable	520,094		514,875
Other policyholders' funds	401,269		236,958
Total policy liabilities	20,073,491		20,466,753
Current and deferred income taxes	630,268		494,639
Short-term debt	733,544		486,113
Long-term debt (estimated fair value: 2024—$1,510,512; 2023—$1,491,229)	1,629,978		1,629,559
Other liabilities	464,151		487,632
Total liabilities	23,531,432		23,564,696
Commitments and Contingencies (Note 5)
Shareholders' equity:
Preferred stock, par value $1 per share—5,000,000 shares authorized; outstanding: 0 in 2024 and 2023	—		—
Common stock, par value $1 per share—320,000,000 shares authorized; outstanding: (2024—102,218,183 issued; 2023—102,218,183 issued)	102,218		102,218
Additional paid-in-capital	526,862		532,474
Accumulated other comprehensive income (loss)	(2,467,236)		(2,772,419)
Retained earnings	7,706,655		7,478,813
Treasury stock, at cost: (2024—8,141,299 shares; 2023—8,426,854 shares)	(829,338)		(854,283)
Total shareholders' equity	5,039,161		4,486,803
Total liabilities and shareholders' equity	$	28,570,593	$	28,051,499

See accompanying Notes to Condensed Consolidated Financial Statements.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(Dollar amounts in thousands, except per share data)



	Three Months Ended March 31,
		2024		2023
Revenue:
Life premium		$	804,265	$	772,597
Health premium		341,019		322,493
Other premium		—		—
Total premium		1,145,284		1,095,090
Net investment income		282,578		257,105
Realized gains (losses)		(11,799)		(30,927)

Other income		76		50
Total revenue		1,416,139		1,321,318

Benefits and expenses:
Life policyholder benefits(1)		519,871		507,977
Health policyholder benefits(2)		202,327		190,962
Other policyholder benefits		9,595		8,988
Total policyholder benefits		731,793		707,927

Amortization of deferred acquisition costs		99,478		92,322
Commissions, premium taxes, and non-deferred acquisition costs		148,110		137,797
Other operating expense		93,214		84,171
Interest expense		28,621		24,867
Total benefits and expenses		1,101,216		1,047,084

Income before income taxes		314,923		274,234
Income tax benefit (expense)		(60,706)		(50,624)



Net income		$	254,217	$	223,610




Basic net income per common share		$	2.71	$	2.32




Diluted net income per common share		$	2.67	$	2.28

(1)Net of a remeasurement gain of $4.9 million for the three months ended March 31, 2024, and a remeasurement gain of $2.7 million for the same period in 2023.

(2)Net of a remeasurement gain of $3.2 million for the three months ended March 31, 2024, and a remeasurement loss of $2.0 million for the same period in 2023.

See accompanying Notes to Condensed Consolidated Financial Statements.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)

(Dollar amounts in thousands)



	Three Months Ended March 31,
		2024		2023
Net income		$	254,217	$	223,610

Other comprehensive income (loss):

Investments:
Unrealized gains (losses) on fixed maturities:
Unrealized holding gains (losses) arising during period		(305,016)		469,119

Other reclassification adjustments included in net income		(2,412)		32,590
Foreign exchange adjustment on fixed maturities recorded at fair value		1,617		9,567



Total unrealized investment gains (losses)		(305,811)		511,276
Less applicable tax (expense) benefit		64,222		(107,368)
Unrealized gains (losses) on investments, net of tax		(241,589)		403,908

Future Policy Benefits:
Change in discount rate on future policy benefits		704,596		(720,890)
Less applicable tax (expense) benefit		(147,964)		151,387
Future policy benefit adjustments, net of tax		556,632		(569,503)






Foreign exchange translation:
Foreign exchange translation adjustments, other than securities		(12,597)		(6,516)
Less applicable tax (expense) benefit		2,646		1,368
Foreign exchange translation adjustments, other than securities, net of tax		(9,951)		(5,148)

Pension:



Pension adjustments		118		(48)
Less applicable tax (expense) benefit		(27)		11
Pension adjustments, net of tax		91		(37)

Other comprehensive income (loss)		305,183		(170,780)
Comprehensive income (loss)		$	559,400	$	52,830

See accompanying Notes to Condensed Consolidated Financial Statements.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Condensed Consolidated Statements of Shareholders' Equity

(Unaudited)

(Dollar amounts in thousands, except per share data)


	Preferred Stock		Common Stock		Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Treasury Stock		Total Shareholders' Equity
Balance at December 31, 2023	$	—	$	102,218	$	532,474	$	(2,772,419)	$	7,478,813	$	(854,283)	$	4,486,803


Comprehensive income (loss)	—		—		—		305,183		254,217		—		559,400
Common dividends declared ($0.2400 per share)	—		—		—		—		(22,603)		—		(22,603)
Acquisition of treasury stock	—		—		—		—		—		(23,469)		(23,469)
Stock-based compensation	—		—		(5,612)		—		(438)		15,317		9,267
Exercise of stock options	—		—		—		—		(3,334)		33,097		29,763

Balance at March 31, 2024	$	—	$	102,218	$	526,862	$	(2,467,236)	$	7,706,655	$	(829,338)	$	5,039,161


	Preferred Stock		Common Stock		Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Treasury Stock		Total Shareholders' Equity

Balance at December 31, 2022	$	—	$	105,218	$	529,661	$	(2,790,313)	$	6,894,535	$	(789,524)	$	3,949,577


Comprehensive income (loss)	—		—		—		(170,780)		223,610		—		52,830
Common dividends declared ($0.2250 per share)	—		—		—		—		(21,542)		—		(21,542)
Acquisition of treasury stock	—		—		—		—		—		(179,276)		(179,276)
Stock-based compensation	—		—		(1,022)		—		—		8,700		7,678
Exercise of stock options	—		—		—		—		(4,059)		41,083		37,024


Balance at March 31, 2023	$	—	$	105,218	$	528,639	$	(2,961,093)	$	7,092,544	$	(919,017)	$	3,846,291

See accompanying Notes to Condensed Consolidated Financial Statements.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(Dollar amounts in thousands)



	Three Months Ended March 31,
	2024		2023













Cash provided from (used for) operating activities	$	350,806	$	477,330

Cash provided from (used for) investing activities:
Investments sold or matured:
Fixed maturities available for sale—sold	27,853		15,705
Fixed maturities available for sale—matured or other redemptions	59,871		61,560
Mortgage loans	7,896		21
Other long-term investments	573		1,929
Total investments sold or matured	96,193		79,215
Acquisition of investments:
Fixed maturities—available for sale	(682,427)		(285,505)
Mortgage loans	(58,406)		(24,186)
Other long-term investments	(80,468)		(23,712)
Total investments acquired	(821,301)		(333,403)
Net (increase) decrease in policy loans	(7,621)		(7,870)
Net (increase) decrease in short-term investments	23,327		39,744


Additions to property and equipment	(9,106)		(8,210)

Investments in low-income housing interests	(13,428)		(17,246)
Cash provided from (used for) investing activities	(731,936)		(247,770)

Cash provided from (used for) financing activities:
Issuance of common stock	29,763		37,024
Cash dividends paid to shareholders	(21,117)		(20,071)



Net borrowing from FHLB	242,000		45,000
Net borrowing (repayment) of commercial paper	5,304		20,070
Acquisition of treasury stock	(23,469)		(179,276)
Net receipts (payments) from deposit-type products	124,475		(54,487)
Cash provided from (used for) financing activities	356,956		(151,740)

Effect of foreign exchange rate changes on cash	4,565		1,729
Net increase (decrease) in cash	(19,609)		79,549
Cash at beginning of year	103,156		92,559
Cash at end of period	$	83,547	$	172,108

See accompanying Notes to Condensed Consolidated Financial Statements.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Note 1—Significant Accounting Policies

Business*:* (Globe Life), (the Company), refers to Globe Life Inc., an insurance holding company incorporated in Delaware in 1979, and Globe Life Inc. subsidiaries and affiliates. Globe Life Inc.'s direct or indirect primary subsidiaries are Globe Life And Accident Insurance Company, American Income Life Insurance Company, Liberty National Life Insurance Company, Family Heritage Life Insurance Company of America, and United American Insurance Company. The underwriting companies are owned by their ultimate corporate parent, Globe Life Inc. (Parent Company).

Globe Life provides a variety of life and supplemental health insurance products and annuities to a broad base of customers. The Company is organized into four reportable segments: life insurance, supplemental health insurance, annuities, and investments.

Globe Life markets its insurance products through a number of distribution channels, each of which sells the products of one or more of Globe Life's insurance segments. Our distribution channels consist of the following exclusive agencies: American Income Life Division (American Income), Liberty National Division (Liberty National) and Family Heritage Division (Family Heritage); an independent agency, United American Division (United American); and our Direct to Consumer Division (DTC).

Basis of Presentation*:* The accompanying condensed consolidated financial statements of Globe Life have been prepared in accordance with the instructions to Form 10-Q. Therefore, they do not include all of the disclosures required by accounting principles generally accepted in the United States of America (GAAP) for annual financial statements. However, in the opinion of management, these statements include all adjustments, consisting of normal recurring adjustments, which are necessary for a fair presentation of the condensed consolidated financial position at March 31, 2024, and the condensed consolidated results of operations, comprehensive income, and cash flows for the periods ended March 31, 2024 and 2023. The interim period condensed consolidated financial statements should be read in conjunction with the Consolidated Financial Statements that are included in the Form 10-K filed with the Securities Exchange Commission (SEC) on February 28, 2024.

Use of Estimates: The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. See further documentation in the significant accounting policies or the accompanying notes.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Note 2—New Accounting Standards


Accounting Pronouncements Adopted in the Current Year
Standard	Description	Effective Date	Effect on the Condensed Consolidated Financial Statements
ASU No. 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions	ASU 2022-03 adds disclosure requirements specific to equity securities subject to contractual sale restrictions. The disclosures clarify the nature of the contractual sale as well as the duration of the restriction and the circumstances that could cause a lapse in the restriction.	This standard is effective for the Company for fiscal years beginning on January 1, 2024 and interim periods within those fiscal years.	The adoption of this standard did not have a material impact on the Condensed Consolidated Financial Statements.


Accounting Pronouncements Yet to be Adopted
Standard	Description	Effective Date	Effect on the Condensed Consolidated Financial Statements
ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures	ASU 2023-07 adds disclosure requirements to segment expenses, improving the financial reporting of the entity’s overall performance and assessment of future cash flows. The disclosures will require more detailed information related to the entity’s reportable segments.	This standard is effective for the Company for annual periods beginning on January 1, 2024 and for interim periods beginning on January 1, 2025, and will be implemented on a retrospective basis.	The Company does not expect the standard will have a material impact on the Condensed Consolidated Financial Statements.
ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures	ASU 2023-09 adds disclosure requirements to disaggregated information related to the effective tax rate reconciliation and information on income taxes paid. The disclosures will enhance the assessment of the entity’s operations and related tax risks.	This standard is effective for the Company for annual periods beginning on January 1, 2025, and will be implemented on a prospective basis.	The Company does not expect the standard will have a material impact on the Condensed Consolidated Financial Statements.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Note 3—Supplemental Information about Changes to Accumulated Other Comprehensive Income

Components of Accumulated Other Comprehensive Income: An analysis of the change in balance by component of Accumulated Other Comprehensive Income is as follows for the three month periods ended March 31, 2024 and 2023:


	Three Months Ended March 31, 2024
	Available for Sale Assets		Future Policy Benefits		Foreign Exchange		Pension Adjustments		Total
Balance at January 1, 2024	$	(827,596)	$	(1,947,391)	$	4,719	$	(2,151)	$	(2,772,419)
Other comprehensive income (loss) before reclassifications, net of tax	(239,684)		556,632		(9,951)		—		306,997
Reclassifications, net of tax	(1,905)		—		—		91		(1,814)
Other comprehensive income (loss)	(241,589)		556,632		(9,951)		91		305,183
Balance at March 31, 2024	$	(1,069,185)	$	(1,390,759)	$	(5,232)	$	(2,060)	$	(2,467,236)


	Three Months Ended March 31, 2023
	Available for Sale Assets		Future Policy Benefits		Foreign Exchange		Pension Adjustments		Total
Balance at January 1, 2023	$	(1,420,672)	$	(1,369,204)	$	(1,681)	$	1,244	$	(2,790,313)
Other comprehensive income (loss) before reclassifications, net of tax	378,162		(569,503)		(5,148)		—		(196,489)
Reclassifications, net of tax	25,746		—		—		(37)		25,709
Other comprehensive income (loss)	403,908		(569,503)		(5,148)		(37)		(170,780)
Balance at March 31, 2023	$	(1,016,764)	$	(1,938,707)	$	(6,829)	$	1,207	$	(2,961,093)

Reclassification Adjustments: Reclassification adjustments out of Accumulated Other Comprehensive Income are presented below for the three month periods ended March 31, 2024 and 2023.


	Three Months Ended March 31,			Affected line items in the Statements of Operations
Component Line Item		2024		2023
Unrealized investment (gains) losses on available for sale assets:
Realized (gains) losses		$	(228)	$	33,124	Realized (gains) losses

Amortization of (discount) premium		(2,184)		(534)		Net investment income
Total before tax		(2,412)		32,590
Tax		507		(6,844)		Income taxes
Total after-tax		(1,905)		25,746
Pension adjustments:
Amortization of prior service cost		269		269		Other operating expense
Amortization of actuarial (gain) loss		(151)		(317)		Other operating expense
Total before tax		118		(48)
Tax		(27)		11		Income taxes
Total after-tax		91		(37)
Total reclassification (after-tax)		$	(1,814)	$	25,709

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Note 4—Investments

Portfolio Composition*:* Summaries of fixed maturities available for sale by amortized cost, fair value, and allowance for credit losses at March 31, 2024 and December 31, 2023, and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) are as follows. Redeemable preferred stock is included within "Corporates, by sector."


	At March 31, 2024
	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value(1)		% of Total Fixed Maturities(2)
Fixed maturities available for sale:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	401,859	$	—	$	1	$	(39,039)	$	362,821	2
States, municipalities, and political subdivisions	3,301,276		—		38,251		(454,605)		2,884,922		16
Foreign governments	39,558		—		—		(10,227)		29,331		—
Corporates, by sector:
Industrials	8,297,566		(7,027)		161,482		(667,927)		7,784,094		43
Financial	5,213,973		—		89,584		(416,724)		4,886,833		27

Utilities	2,127,792		—		51,901		(105,623)		2,074,070		11
Total corporates	15,639,331		(7,027)		302,967		(1,190,274)		14,744,997		81
Collateralized debt obligations	36,730		—		3,001		—		39,731		—
Other asset-backed securities	86,030		—		2		(3,481)		82,551		1
Total fixed maturities	$	19,504,784	$	(7,027)	$	344,222	$	(1,697,626)	$	18,144,353	100

(1)Amount reported in the balance sheet.

(2)At fair value.


	At December 31, 2023
	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value(1)		% of Total Fixed Maturities(2)
Fixed maturities available for sale:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	398,450	$	—	$	7	$	(32,306)	$	366,151	2
States, municipalities, and political subdivisions	3,296,305		—		47,346		(403,329)		2,940,322		16
Foreign governments	44,453		—		1		(10,348)		34,106		—
Corporates, by sector:
Industrials	8,016,126		(7,115)		213,078		(566,847)		7,655,242		43
Financial	5,028,151		—		112,368		(388,340)		4,752,179		27

Utilities	2,017,967		—		73,925		(94,130)		1,997,762		11
Total corporates	15,062,244		(7,115)		399,371		(1,049,317)		14,405,183		81
Collateralized debt obligations	37,110		—		5,036		—		42,146		—
Other asset-backed securities	86,352		—		3		(4,057)		82,298		1
Total fixed maturities	$	18,924,914	$	(7,115)	$	451,764	$	(1,499,357)	$	17,870,206	100

(1)Amount reported in the balance sheet.

(2)At fair value.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The Company has exposure to real estate investment trusts with an average rating of BBB+, which had a fair value of $415 million (2% of the total fixed maturity portfolio) and $425 million (2% of the total fixed maturity portfolio) at March 31, 2024 and December 31, 2023, respectively.

A schedule of fixed maturities available for sale by contractual maturity date at March 31, 2024, is shown below on an amortized cost basis, net of allowance for credit losses, and on a fair value basis. Actual disposition dates could differ from contractual maturities due to call or prepayment provisions.


	At March 31, 2024
	Amortized Cost, net		Fair Value
Fixed maturities available for sale:
Due in one year or less	$	86,769	$	86,518
Due after one year through five years	857,913		862,187
Due after five years through ten years	2,034,083		2,040,670
Due after ten years through twenty years	8,712,181		8,331,022
Due after twenty years	7,684,013		6,701,637
Mortgage-backed and asset-backed securities	122,798		122,319
	$	19,497,757	$	18,144,353

Analysis of Investment Operations: "Net investment income" for the three month periods ended March 31, 2024 and 2023 is summarized as follows:


	Three Months Ended March 31,
		2024		2023		% Change
Fixed maturities available for sale		$	246,098	$	232,299	6
Policy loans		12,816		11,755		9
Mortgage loans		6,760		4,003		69
Other long-term investments(1)		19,663		11,740		67
Short-term investments		1,688		1,595
		287,025		261,392		10
Less investment expense		(4,447)		(4,287)		4
Net investment income		$	282,578	$	257,105	10

(1)For the three months ended March 31, 2024 and 2023, the investment funds, accounted for under the fair value option method, recorded $18.9 million and $11.3 million, respectively, in net investment income. Refer to Other Long-Term Investments below for further discussion on the investment funds.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Selected information about sales of fixed maturities available for sale is as follows:


	Three Months Ended March 31,
		2024		2023
Fixed maturities available for sale:
Proceeds from sales(1)		$	27,853	$	15,705
Gross realized gains		175		—
Gross realized losses		(35)		(358)

(1)There were no unsettled sales in the periods ended March 31, 2024 and 2023.

An analysis of "Realized gains (losses)" is as follows:


	Three Months Ended March 31,
		2024		2023
Realized investment gains (losses):
Fixed maturities available for sale:
Sales and other(1)		$	140	$	(357)

Provision for credit losses		88		(32,767)
Fair value option—change in fair value		(15,403)		1,858
Mortgage loans		(874)		(1,280)
Other investments		314		(214)
Realized gains (losses) from investments		(15,735)		(32,760)

Other gains (losses)		3,936		1,833
Total realized gains (losses)		(11,799)		(30,927)
Applicable tax		2,478		6,495
Realized gains (losses), net of tax		$	(9,321)	$	(24,432)

(1)During the three months ended March 31, 2024 and 2023, the Company recorded $66.9 million and $0 of issuer-initiated exchanges of fixed maturities (noncash transactions) that resulted in no realized gains (losses) in either period.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Fair Value Measurements: The following tables represent the fair value of fixed maturities measured on a recurring basis at March 31, 2024 and December 31, 2023:


	Fair Value Measurement at March 31, 2024:
	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Fixed maturities available for sale
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	—		$	362,821		$	—		$	362,821
States, municipalities, and political subdivisions	—			2,884,922			—			2,884,922
Foreign governments	—			29,331			—			29,331
Corporates, by sector:
Industrials	—			7,584,006			200,088			7,784,094
Financial	—			4,756,052			130,781			4,886,833

Utilities	—			1,967,375			106,695			2,074,070
Total corporates	—			14,307,433			437,564			14,744,997
Collateralized debt obligations	—			—			39,731			39,731
Other asset-backed securities	—			82,551			—			82,551
Total fixed maturities	$	—		$	17,667,058		$	477,295		$	18,144,353
Percentage of total	—		%	97		%	3		%	100		%


	Fair Value Measurement at December 31, 2023:
	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Fixed maturities available for sale
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	—		$	366,151		$	—		$	366,151
States, municipalities, and political subdivisions	—			2,940,322			—			2,940,322
Foreign governments	—			34,106			—			34,106
Corporates, by sector:
Industrials	—			7,440,493			214,749			7,655,242
Financial	—			4,621,160			131,019			4,752,179

Utilities	—			1,888,797			108,965			1,997,762
Total corporates	—			13,950,450			454,733			14,405,183
Collateralized debt obligations	—			—			42,146			42,146
Other asset-backed securities	—			82,298			—			82,298
Total fixed maturities	$	—		$	17,373,327		$	496,879		$	17,870,206
Percentage of total	—		%	97		%	3		%	100		%

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following tables represent changes in fixed maturities measured at fair value on a recurring basis using significant unobservable inputs (Level 3):


	Analysis of Changes in Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Asset- backed Securities			Collateralized Debt Obligations			Corporates			Total
Balance at January 1, 2024	$	—		$	42,146		$	454,733		$	496,879

Included in realized gains / losses	—			—			—			—
Included in other comprehensive income	—			(2,035)			(5,996)			(8,031)
Acquisitions	—			—			7,800			7,800
Sales	—			—			—			—
Amortization	—			1,141			(4)			1,137
Other(1)	—			(1,521)			(18,969)			(20,490)
Transfers into Level 3(2)	—			—			—			—
Transfers out of Level 3(2)	—			—			—			—
Balance at March 31, 2024	$	—		$	39,731		$	437,564		$	477,295
Percent of total fixed maturities	—		%	—		%	3		%	3		%

(1)Includes capitalized interest, foreign exchange adjustments, and principal repayments.

(2)Considered to be transferred at the end of the period. Transfers into Level 3 occur when observable inputs are no longer available. Transfers out of Level 3 occur when observable inputs become available.


	Analysis of Changes in Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Asset- backed Securities			Collateralized Debt Obligations			Corporates			Total
Balance at January 1, 2023	$	—		$	50,364		$	478,083		$	528,447

Included in realized gains / losses	—			—			—			—
Included in other comprehensive income	—			(4,542)			5,370			828
Acquisitions	—			—			—			—
Sales	—			—			—			—
Amortization	—			1,141			2			1,143
Other(1)	—			(1,461)			(11,816)			(13,277)
Transfers into Level 3(2)	—			—			—			—
Transfers out of Level 3(2)	—			—			—			—
Balance at March 31, 2023	$	—		$	45,502		$	471,639		$	517,141
Percent of total fixed maturities	—		%	—		%	3		%	3		%

(1)Includes capitalized interest, foreign exchange adjustments, and principal repayments.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following table presents changes in unrealized gains and losses for the period included in accumulated other comprehensive income for assets held at the end of the reporting period for Level 3 classification:


	Changes in Unrealized Gains (Losses) included in Accumulated Other Comprehensive Income for Assets Held at the End of the Period
	Asset- backed Securities		Collateralized Debt Obligations		Corporates		Total
At March 31, 2024	$	—	$	(2,035)	$	(5,996)	$	(8,031)
At March 31, 2023	—		(4,542)		5,370		828

Unrealized Loss Analysis*:* The following table discloses information about fixed maturities available for sale in an unrealized loss position.


	Less than Twelve Months	Twelve Months or Longer	Total
Number of issues (CUSIPs) held:
As of March 31, 2024	350	1,654	2,004
As of December 31, 2023	151	1,614	1,765

Globe Life's entire fixed maturity portfolio consisted of 2,551 issues by 991 different issuers at March 31, 2024 and 2,473 issues by 980 different issuers at December 31, 2023. The increase in the number of securities in an unrealized loss position during the period ended March 31, 2024 is due to the increase in interest rates. The weighted-average quality rating of all unrealized loss positions at amortized cost was A- as of March 31, 2024 and December 31, 2023.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following tables disclose unrealized investment losses by class and major sector of fixed maturities available for sale at March 31, 2024 and December 31, 2023.

Analysis of Gross Unrealized Investment Losses


	At March 31, 2024
	Less than Twelve Months				Twelve Months or Longer				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Fixed maturities available for sale:
Investment grade securities:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	2,033	$	(66)	$	360,438	$	(38,973)	$	362,471	$	(39,039)
States, municipalities, and political subdivisions	479,111		(7,440)		1,648,303		(447,165)		2,127,414		(454,605)
Foreign governments	1,469		(5)		27,862		(10,222)		29,331		(10,227)
Corporates, by sector:
Industrials	692,151		(25,399)		4,221,438		(613,109)		4,913,589		(638,508)
Financial	361,061		(3,813)		2,419,494		(369,671)		2,780,555		(373,484)

Utilities	284,655		(3,438)		681,618		(100,695)		966,273		(104,133)
Total corporates	1,337,867		(32,650)		7,322,550		(1,083,475)		8,660,417		(1,116,125)
Collateralized debt obligations	—		—		—		—		—		—
Other asset-backed securities	—		—		71,424		(2,980)		71,424		(2,980)
Total investment grade securities	1,820,480		(40,161)		9,430,577		(1,582,815)		11,251,057		(1,622,976)

Below investment grade securities:


Corporates, by sector:
Industrials	—		—		146,466		(29,419)		146,466		(29,419)
Financial	8,704		(1,403)		166,838		(41,837)		175,542		(43,240)

Utilities	8,902		(27)		19,713		(1,463)		28,615		(1,490)
Total corporates	17,606		(1,430)		333,017		(72,719)		350,623		(74,149)
Collateralized debt obligations	—		—		—		—		—		—
Other asset-backed securities	—		—		11,079		(501)		11,079		(501)
Total below investment grade securities	17,606		(1,430)		344,096		(73,220)		361,702		(74,650)
Total fixed maturities	$	1,838,086	$	(41,591)	$	9,774,673	$	(1,656,035)	$	11,612,759	$	(1,697,626)

Gross unrealized losses may fluctuate quarter over quarter due to adverse factors in the market that affect our holdings, such as changes in interest rates or credit spreads. The Company considers many factors when determining whether an allowance for a credit loss should be recorded. While the Company holds securities that may be in an unrealized loss position from time to time, Globe Life does not generally intend to sell and it is unlikely that the Company will be required to sell the fixed maturities prior to their anticipated recovery or maturity due to the strong cash flows generated by its insurance operations.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Analysis of Gross Unrealized Investment Losses


	At December 31, 2023
	Less than Twelve Months				Twelve Months or Longer				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Fixed maturities available for sale:
Investment grade securities:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	—	$	—	$	364,006	$	(32,306)	$	364,006	$	(32,306)
States, municipalities, and political subdivisions	252,800		(3,520)		1,610,163		(399,809)		1,862,963		(403,329)
Foreign governments	—		—		32,591		(10,348)		32,591		(10,348)
Corporates, by sector:
Industrials	191,573		(3,881)		4,317,827		(530,011)		4,509,400		(533,892)
Financial	242,099		(6,584)		2,341,424		(339,628)		2,583,523		(346,212)

Utilities	81,194		(648)		686,043		(91,959)		767,237		(92,607)
Total corporates	514,866		(11,113)		7,345,294		(961,598)		7,860,160		(972,711)
Collateralized debt obligations	—		—		—		—		—		—
Other asset-backed securities	—		—		70,956		(3,648)		70,956		(3,648)
Total investment grade securities	767,666		(14,633)		9,423,010		(1,407,709)		10,190,676		(1,422,342)

Below investment grade securities:


Corporates, by sector:
Industrials	10,745		(199)		145,697		(32,756)		156,442		(32,955)
Financial	25,563		(2,602)		151,190		(39,526)		176,753		(42,128)

Utilities	—		—		19,654		(1,523)		19,654		(1,523)
Total corporates	36,308		(2,801)		316,541		(73,805)		352,849		(76,606)
Collateralized debt obligations	—		—		—		—		—		—
Other asset-backed securities	—		—		11,288		(409)		11,288		(409)
Total below investment grade securities	36,308		(2,801)		327,829		(74,214)		364,137		(77,015)
Total fixed maturities	$	803,974	$	(17,434)	$	9,750,839	$	(1,481,923)	$	10,554,813	$	(1,499,357)

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Fixed Maturities, Allowance for Credit Losses*:* A summary of the activity in the allowance for credit losses is as follows.


	Three Months Ended March 31,
		2024		2023
Allowance for credit losses beginning balance		$	7,115	$	—
Additions to allowance for which credit losses were not previously recorded		—		32,767
Additions (reductions) to allowance for fixed maturities that previously had an allowance		(88)		—
Reduction of allowance for which the Company intends to sell or more likely than not will be required to sell or sold during the period		—		—
Allowance for credit losses ending balance		$	7,027	$	32,767

As of March 31, 2024 and December 31, 2023, the Company did not have any fixed maturities in non-accrual status.

Mortgage Loans (commercial mortgage loans): Summaries of commercial mortgage loans by property type and geographical location at March 31, 2024 and December 31, 2023 are as follows:


	March 31, 2024			December 31, 2023
	Carrying Value		% of Total	Carrying Value		% of Total
Property type:
Multi-family	$	117,147	36	$	116,299	42
Industrial	81,975		25	57,267		20
Retail	46,822		14	23,925		9
Hospitality	43,634		13	43,897		16
Mixed use	37,267		11	34,749		12
Office	6,734		2	6,734		2

Total recorded investment	333,579		101	282,871		101
Less allowance for credit losses	(4,546)		(1)	(3,672)		(1)
Carrying value, net of allowance for credit losses	$	329,033	100	$	279,199	100


	March 31, 2024			December 31, 2023
	Carrying Value		% of Total	Carrying Value		% of Total
Geographic location:
Florida	$	60,587	18	$	48,233	17
California	57,093		17	54,721		20
Texas	53,399		16	45,111		16
New Jersey	44,592		14	44,574		16
New York	35,142		11	20,284		7
Washington	14,978		4	14,969		5
Other	67,788		21	54,979		20
Total recorded investment	333,579		101	282,871		101
Less allowance for credit losses	(4,546)		(1)	(3,672)		(1)
Carrying value, net of allowance for credit losses	$	329,033	100	$	279,199	100

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following tables are reflective of the key factors, debt service coverage ratios, and loan-to-value (LTV) ratios that are utilized by management to monitor the performance of the portfolios. The Company only makes new investments in commercial mortgage loans that have a LTV ratio less than 80%. LTV's that exceed 80% are generally as a result of decreases in the valuation of the underlying property. Generally, a higher LTV ratio and a lower debt service coverage ratio equates to higher risk of loss.


	March 31, 2024
	Recorded Investment
	Debt Service Coverage Ratios(1)
	<1.00x		1.00x—1.20x		>1.20x		Total		% of Gross Total
Loan-to-value ratio(2):
Less than 70%	$	35,492	$	155,974	$	125,457	$	316,923	95
70% to 80%	—		—		—		—		—
81% to 90%	9,621		—		—		9,621		3
Greater than 90%	7,035		—		—		7,035		2
Total	$	52,148	$	155,974	$	125,457	333,579		100
Less allowance for credit losses							(4,546)
Total, net of allowance for credit losses							$	329,033

(1)Annual net operating income divided by annual mortgage debt service (principal and interest).

(2)Loan balance divided by appraised value at origination, including planned renovations and stabilized occupancy. Updated internal valuations are used when a loan is materially underperforming.


	December 31, 2023
	Recorded Investment
	Debt Service Coverage Ratios(1)
	<1.00x		1.00x—1.20x		>1.20x		Total		% of Gross Total
Loan-to-value ratio(2):
Less than 70%	$	27,091	$	180,761	$	58,364	$	266,216	94
70% to 80%	—		—		—		—		—
81% to 90%	8,468		—		1,153		9,621		3
Greater than 90%	7,034		—		—		7,034		3
Total	$	42,593	$	180,761	$	59,517	282,871		100
Less allowance for credit losses							(3,672)
Total, net of allowance for credit losses							$	279,199

(1)Annual net operating income divided by annual mortgage debt service (principal and interest).

(2)Loan balance divided by appraised value at origination, including planned renovations and stabilized occupancy. Updated internal valuations are used when a loan is materially underperforming.

As of March 31, 2024, the Company evaluated the commercial mortgage loan portfolio on a pool basis to determine the allowance for credit losses. At the end of the period, the Company had 32 loans in the portfolio. For the three months ended March 31, 2024, the allowance for credit losses increased by $874 thousand to $4.5 million. The provision for credit losses is included in "Realized gains (losses)" in the Condensed Consolidated Statements of Operations.


	Three Months Ended March 31,
		2024		2023
Allowance for credit losses beginning balance		$	3,672	$	1,789

Provision (reversal) for credit losses		874		1,280

Allowance for credit losses ending balance		$	4,546	$	3,069

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

There was one delinquent commercial mortgage loan, with an outstanding par value of $3.7 million and outstanding interest due of $116 thousand, as of March 31, 2024. The underlying collateral for this loan is in the process of being sold and the Company expects to recover all interest and principal due as of March 31, 2024. There were no delinquent commercial mortgage loans as of December 31, 2023. As of March 31, 2024, the Company had one commercial mortgage loan in non-accrual status with a principal balance of $4.4 million. As of December 31, 2023, the Company had no commercial mortgage loans in non-accrual status. The Company's unfunded commitment balance to commercial loan borrowers was $29 million as of March 31, 2024.

Other Long-Term Investments*:* Other long-term investments consist of the following assets:



	March 31, 2024		December 31, 2023
Investment funds	$	844,916	$	795,583

Other	54,169		40,295
Total	$	899,085	$	835,878

The following table presents additional information about the Company's investment funds as of March 31, 2024 and December 31, 2023 at fair value:


	Fair Value				Unfunded Commitments
Investment Category	March 31, 2024		December 31, 2023		March 31, 2024		Redemption Term/Notice(1)




Commercial mortgage loans	$	459,549	$	411,315	$	489,617	Fully redeemable and non-redeemable with varying terms.
Opportunistic and private credit	180,019		181,410		125,844		Fully redeemable and non-redeemable with varying terms.


Infrastructure	165,441		165,887		16,706		Fully redeemable and non-redeemable with varying terms.


Other	39,907		36,971		53,752		Non-redeemable with varying terms
Total investment funds	$	844,916	$	795,583	$	685,919

(1) Non-redeemable funds generally have an expected life of 7 to 12 years from fund closing with extension options of 1 to 4 years. Redemptions are paid out throughout the life of the funds at the General Partner's discretion. Redeemable funds can generally be redeemed over 6 to 36 months upon request from limited partners.

The Company had $67 million of capital called during the period from existing investment funds. The Company's unfunded commitments were $686 million as of March 31, 2024.

Note 5—Commitments and Contingencies

Guarantees: The Parent Company has guaranteed letters of credit in connection with its credit facility with a group of banks. The letters of credit were issued by TMK Re, Ltd., a wholly-owned subsidiary, to secure TMK Re, Ltd.’s obligation for claims on certain policies reinsured by TMK Re, Ltd. that were sold by other Globe Life insurance subsidiaries. These letters of credit facilitate TMK Re, Ltd.’s ability to reinsure the business of Globe Life's insurance carriers. The agreement was amended on March 29, 2024 and now expires in 2029. The maximum amount of letters of credit available is $250 million. The Parent Company would be liable to the extent that TMK Re, Ltd. does not pay the reinsured party. The amount of letters of credit outstanding at March 31, 2024 was $115 million.

Litigation: Globe Life Inc. and its subsidiaries, in common with the insurance industry in general, are subject to litigation, including: putative class action litigation; alleged breaches of contract; torts, including bad faith and fraud claims based on alleged wrongful or fraudulent acts of agents of the Parent Company's insurance subsidiaries; alleged employment discrimination; alleged worker misclassification; and miscellaneous other causes of action. Based upon information presently available, and in light of legal and other factual defenses available to the Parent Company and its subsidiaries, management does not believe that it is reasonably possible that such litigation will

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

have a material adverse effect on Globe Life's financial condition, future operating results or liquidity; however, assessing the eventual outcome of litigation necessarily involves forward-looking speculation as to judgments to be made by judges, juries and appellate courts in the future. This bespeaks caution, particularly in states with reputations for high punitive damage verdicts.

On September 30, 2022, putative class action litigation was filed against American Income, Giglione-Ackerman Agency, LLC, Eric Giglione and David Ackerman (collectively, “Defendants”) in New Jersey Superior Court (Atiya Bell, et al. v. American Income Life Insurance Company, et al., Case No. MID-L-004928-22). American Income subsequently removed the case to United States District Court for the District of New Jersey (Case No. 2:22-cv-06913-CCC-MAH). Plaintiffs Atiya Bell and Abel Flores (“Plaintiffs”) are former New Jersey independent sales agents who alleged they should have been classified as employees, and asserted claims under New Jersey state law on behalf of (i) a putative class of registered agents in New Jersey who have worked remotely for at least one week since March 9, 2020, and (ii) a putative class of registered agents in New Jersey who trained for at least one week to become sales agents for American Income in New Jersey during the six years prior to September 30, 2022. Plaintiffs made claims under the New Jersey Wage and Hour Law and the New Jersey Wage Payment Law for the alleged failure to pay minimum wages and overtime pay, including for time spent in training, liquidated damages and attorney’s fees and costs. American Income filed a motion to compel this matter to arbitration pursuant to the arbitration clauses found in the agent contracts executed by the claimants. In September 2023, the court denied American Income’s motion, but did so without prejudice, and invited the parties to “conduct limited discovery on the issue of arbitrability,” after which discovery the court would hear a renewed motion from American Income. However, in November 2023, prior to American Income’s filing such motion, the parties agreed in principle to settle the claimants’ claims for a non-material amount.

On September 1, 2023, plaintiff Miné Caglar Cost (“Plaintiff) filed a complaint against American Income Life Insurance Company (“American Income”) in the Superior Court of the State of California for the County of Los Angeles, asserting a single claim for violation of the Private Attorneys General Act (“PAGA”) (Cost v. American Income Life Insurance Company, et al., Case No. 23SMCV04113). Plaintiff is a former California independent insurance sales agent who alleges one cause of action for civil penalties under PAGA arising out of alleged violations of the wage-and-hour provisions of the California Labor Code stemming from American Income’s alleged misclassification of Plaintiff and other California-based sales agents as independent contractors. American Income filed a motion to compel arbitration on an individual basis and stay the representative component of Plaintiff’s claims, to which Plaintiff stipulated. On December 12, 2023, the Court approved the parties’ stipulation to compel the matter to individual arbitration and stayed the case pending the completion of the individual arbitration.

On April 4, 2023, putative class action litigation was filed against National Income Life Insurance Company (“National Income”) in New York Supreme Court by plaintiffs Melissa K. Goppert, Sarah Valente, James O’Neill, Jennifer Abe, and Emily Herendeen (“Plaintiffs”) (Goppert, et al. v. National Income Life Insurance Company, Index No. 153096/2023). Plaintiffs are former National Income independent sales agents who allege they should have been classified as employees and assert claims under New York state law on behalf of a putative class of former independent sales agents and individuals who trained to become independent sale agents since March 2017. Plaintiffs make claims under New York’s Minimum Wage Law (NYLL § 633 and 12 NYCRR § 142-2.1); Overtime Compensation Law (NYLL § 633 and 12 NYCRR § 142-2.2); and “Spread of Hours” Law (12 NYCRR § 142-2.4) for the alleged failure to pay minimum wages and overtime pay, including for time spent in training, and attorney’s fees and costs. National Income filed a motion to compel arbitration of each Plaintiff’s claims on an individual basis, which the Court granted in full on January 11, 2024, and on February 7, 2024, Plaintiffs filed a notice of appeal of the Court’s order.

On November 30, 2023, the Company and our subsidiary, American Income Life Insurance Company, received subpoenas from the U.S. Attorney’s Office for the Western District of Pennsylvania, seeking documents relating to sales practices by certain of our independent sales agents contracted to sell American Income Life Insurance Company policies. The Company and American Income Life Insurance Company are in the preliminary stages of responding to these subpoenas and have been cooperating with the Department of Justice’s investigation. The Department of Justice has not asserted any claims or made allegations against the Company and American Income Life Insurance Company with respect to the foregoing inquiry, and the Company currently is not aware that any legal

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

proceedings are contemplated by governmental authorities. While no assurances can be made, at present management does not believe that it is reasonably possible or probable that this matter will result in a material loss.

A putative securities class action was filed on April 30, 2024 against the Company and six of its current/former senior executives in the United States District Court for the Eastern District of Texas. The case, which is captioned City of Miami Gen. Emp. & Sanitation Emp. Ret. Trust, et al. v. Globe Life Inc., et al., Case No. 4:24-cv-00376, asserts claims under §§ 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of a putative class of purchasers of the Company’s securities from May 8, 2019 through April 10, 2024. The Complaint alleges that certain of the Company’s disclosures about financial performance and certain other public statements during the putative class period were materially false or misleading. The Company plans to vigorously defend against the lawsuit.

Pursuant to the Company’s governing documents and indemnification agreements with the named defendants, the Company has agreed to indemnify those defendants for all expenses and losses related to the litigation subject to the terms of those indemnification agreements. The outcome of litigation of this type is inherently uncertain, and there is always the possibility that a court rules in a manner that is adverse to the interests of the Company and the individual defendants. However, the amount of any such loss in that scenario cannot be reasonably estimated at this time. Further, management cannot reasonably estimate whether an outcome on the class action will be resolved in the near term.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Note 6—Policy Liabilities

The liability for future policy benefits is determined based on the net level premium method, which requires the liability be calculated as the present value of estimated future policyholder benefits and the related termination expenses, less the present value of estimated future net premiums to be collected from policyholders. The following tables summarize balances and changes in the net liability for future policy benefits, before reinsurance, for traditional life long-duration contracts for the three month periods ended March 31, 2024 and 2023:


	Life
	Present value of expected future net premiums
	American Income		DTC		Liberty National		Other		Total
Balance at January 1, 2023	$	4,273,156	$	5,910,224	$	1,094,407	$	470,741	$	11,748,528
Beginning balance at original discount rates	4,246,723		5,680,864		1,066,123		449,209		11,442,919
Effect of changes in assumptions on future cash flows	—		—		—		—		—
Effect of actual variances from expected experience	(29,981)		(47,988)		(5,590)		(1,886)		(85,445)
Adjusted balance at January 1, 2023	4,216,742		5,632,876		1,060,533		447,323		11,357,474
Issuances(1)	192,555		168,952		30,142		7,241		398,890
Interest accrual(2)	47,898		70,991		13,288		5,670		137,847
Net premiums collected(3)	(127,239)		(153,919)		(33,188)		(11,557)		(325,903)

Effect of changes in the foreign exchange rate	(3,999)		—		—		—		(3,999)
Ending balance at original discount rates	4,325,957		5,718,900		1,070,775		448,677		11,564,309

Effect of change from original to current discount rates	141,680		391,650		57,308		34,379		625,017
Balance at March 31, 2023	$	4,467,637	$	6,110,550	$	1,128,083	$	483,056	$	12,189,326

Balance at January 1, 2024	$	4,681,888	$	6,052,651	$	1,129,716	$	478,052	$	12,342,307
Beginning balance at original discount rates	4,523,329		5,664,259		1,077,831		443,949		11,709,368
Effect of changes in assumptions on future cash flows	—		—		—		—		—
Effect of actual variances from expected experience	(48,248)		(36,229)		(10,448)		(1,851)		(96,776)
Adjusted balance at January 1, 2024	4,475,081		5,628,030		1,067,383		442,098		11,612,592
Issuances(1)	211,847		149,231		26,164		5,931		393,173
Interest accrual(2)	53,823		73,420		13,839		5,764		146,846
Net premiums collected(3)	(135,686)		(152,631)		(33,901)		(11,401)		(333,619)

Effect of changes in the foreign exchange rate	(8,927)		—		—		—		(8,927)
Ending balance at original discount rates	4,596,138		5,698,050		1,073,485		442,392		11,810,065

Effect of change from original to current discount rates	56,533		247,209		28,724		21,777		354,243
Balance at March 31, 2024	$	4,652,671	$	5,945,259	$	1,102,209	$	464,169	$	12,164,308

(1)Issuances represent the present value, using the original discount rate, of the expected net premiums related to new policies issued during each respective period.

(2)The interest accrual is the interest earned on the beginning present value of the expected net premiums, as well as the interest on actual net premiums earned during the period, using the original interest rate.

(3)Net premiums collected represent the product of the current period net premium ratio and the gross premiums collected during the period on the in-force business.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)


		Life
	Present value of expected future policy benefits
	American Income			DTC			Liberty National			Other			Total
Balance at January 1, 2023		$	9,119,104		$	9,225,451		$	3,429,256		$	3,976,150		$	25,749,961
Beginning balance at original discount rates		8,409,761			8,477,892			3,272,980			3,403,704			23,564,337
Effect of changes in assumptions on future cash flows		—			—			—			—			—
Effect of actual variances from expected experience		(31,526)			(48,947)			(7,054)			(2,896)			(90,423)
Adjusted balance at January 1, 2023		8,378,235			8,428,945			3,265,926			3,400,808			23,473,914
Issuances(1)		192,555			168,952			30,142			7,241			398,890
Interest accrual(2)		109,329			112,768			43,256			50,378			315,731
Benefit payments(3)		(96,674)			(147,061)			(54,730)			(30,892)			(329,357)

Effect of changes in the foreign exchange rate		(9,711)			—			—			—			(9,711)
Ending balance at original discount rates		8,573,734			8,563,604			3,284,594			3,427,535			23,849,467
Effect of change from original to current discount rates		1,063,729			1,061,076			274,418			738,992			3,138,215
Balance at March 31, 2023		$	9,637,463		$	9,624,680		$	3,559,012		$	4,166,527		$	26,987,682





Balance at January 1, 2024	$	10,163,627	$	9,714,516	$	3,605,392	$	4,239,623	$	27,723,158
Beginning balance at original discount rates	9,061,833		8,656,752		3,338,252		3,506,859		24,563,696
Effect of changes in assumptions on future cash flows	—		—		—		—		—
Effect of actual variances from expected experience	(52,221)		(36,444)		(10,449)		(2,867)		(101,981)
Adjusted balance at January 1, 2024	9,009,612		8,620,308		3,327,803		3,503,992		24,461,715
Issuances(1)	211,847		149,231		26,164		5,931		393,173
Interest accrual(2)	120,201		117,925		44,554		52,136		334,816
Benefit payments(3)	(104,758)		(159,061)		(58,109)		(34,177)		(356,105)

Effect of changes in the foreign exchange rate	(20,637)		—		—		—		(20,637)
Ending balance at original discount rates	9,216,265		8,728,403		3,340,412		3,527,882		24,812,962
Effect of change from original to current discount rates	741,828		771,812		159,330		576,010		2,248,980
Balance at March 31, 2024	$	9,958,093	$	9,500,215	$	3,499,742	$	4,103,892	$	27,061,942

(1)Issuances represent the present value, using the original discount rate, of the expected future policy benefits related to new policies issued during each respective period.

(2)The interest accrual is the interest earned on the beginning present value of the expected future policy benefits, as well as the interest on actual benefits and expenses paid during the period, using the original interest rate.

(3)Benefit payments represent the release of the present value, using the original discount rate, of the actual future policy benefits incurred during the period due to death, lapse, and maturity benefit payments based on the revised expected assumptions.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)


	Life(2)
	Net liability for future policy benefits as of March 31, 2023
	American Income		DTC		Liberty National		Other		Total
Net liability for future policy benefits at original discount rates	$	4,247,777	$	2,844,704	$	2,213,819	$	2,978,858	$	12,285,158
Effect of changes in discount rate assumptions	922,049		669,426		217,110		704,613		2,513,198
Other Adjustments(1)	95		4,546		8,017		72		12,730
Net liability for future policy benefits, after other adjustments, at current discount rates	5,169,921		3,518,676		2,438,946		3,683,543		14,811,086
Reinsurance recoverable	(141)		—		(7,531)		(36,837)		(44,509)
Net liability for future policy benefits, after reinsurance recoverable, at current discount rates	$	5,169,780	$	3,518,676	$	2,431,415	$	3,646,706	$	14,766,577

(1)Other adjustments include the Company's effects of capping and flooring the liability.

(2)Includes the immaterial error correction noted below.


	Life
	Net liability for future policy benefits as of March 31, 2024
	American Income		DTC		Liberty National		Other		Total
Net liability for future policy benefits at original discount rates	$	4,620,127	$	3,030,353	$	2,266,927	$	3,085,490	$	13,002,897
Effect of changes in discount rate assumptions	685,295		524,603		130,606		554,233		1,894,737
Other Adjustments(1)	287		3,549		5,418		85		9,339
Net liability for future policy benefits, after other adjustments, at current discount rates	5,305,709		3,558,505		2,402,951		3,639,808		14,906,973
Reinsurance recoverable	(170)		—		(7,787)		(36,564)		(44,521)
Net liability for future policy benefits, after reinsurance recoverable, at current discount rates	$	5,305,539	$	3,558,505	$	2,395,164	$	3,603,244	$	14,862,452

(1)Other adjustments include the Company's capping and flooring the liability.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following tables summarize balances and changes in the net liability for future policy benefits for long-duration health contracts for the three month periods ended March 31, 2024 and 2023:


	Health
	Present value of expected future net premiums
	United American		Family Heritage		Liberty National		American Income		DTC		Total
Balance at January 1, 2023	$	2,908,501	$	1,594,992	$	423,490	$	190,296	$	90,143	$	5,207,422
Beginning balance at original discount rates	2,941,261		1,729,219		415,442		192,631		87,751		5,366,304
Effect of changes in assumptions on future cash flows	—		—		—		—		—		—
Effect of actual variances from expected experience	(34,132)		(18,758)		(16,585)		(1,621)		(2,573)		(73,669)
Adjusted balance at January 1, 2023	2,907,129		1,710,461		398,857		191,010		85,178		5,292,635
Issuances(1)	75,839		67,787		13,303		10,212		2,392		169,533
Interest accrual(2)	31,587		16,199		4,890		2,036		1,057		55,769
Net premiums collected(3)	(65,914)		(43,979)		(12,403)		(5,424)		(2,661)		(130,381)

Effect of changes in the foreign exchange rate	—		—		—		(388)		—		(388)
Ending balance at original discount rates	2,948,641		1,750,468		404,647		197,446		85,966		5,387,168

Effect of change from original to current discount rates	49,082		(86,054)		16,800		3,220		4,277		(12,675)
Balance at March 31, 2023	$	2,997,723	$	1,664,414	$	421,447	$	200,666	$	90,243	$	5,374,493

Balance at January 1, 2024	$	3,697,771	$	1,711,741	$	358,472	$	206,381	$	115,363	$	6,089,728
Beginning balance at original discount rates	3,625,803		1,783,173		348,570		201,869		109,880		6,069,295
Effect of changes in assumptions on future cash flows	—		—		—		—		—		—
Effect of actual variances from expected experience	(40,531)		(17,092)		(11,410)		(3,550)		(2,316)		(74,899)
Adjusted balance at January 1, 2024	3,585,272		1,766,081		337,160		198,319		107,564		5,994,396
Issuances(1)	104,603		64,008		13,558		9,949		4,609		196,727
Interest accrual(2)	41,822		18,103		4,227		2,283		1,368		67,803
Net premiums collected(3)	(70,249)		(46,400)		(12,780)		(5,839)		(2,678)		(137,946)

Effect of changes in the foreign exchange rate	—		—		—		(862)		—		(862)
Ending balance at original discount rates	3,661,448		1,801,792		342,165		203,850		110,863		6,120,118

Effect of change from original to current discount rates	(8,053)		(107,766)		3,276		(55)		3,016		(109,582)
Balance at March 31, 2024	$	3,653,395	$	1,694,026	$	345,441	$	203,795	$	113,879	$	6,010,536

(1)Issuances represent the present value, using the original discount rate, of the expected net premiums related to new policies issued during each respective period.

(3)Net premiums collected represent the product of the current period net premium ratio and the gross premiums collected during the period on the in-force business.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)


		Health
	Present value of expected future policy benefits
	United American			Family Heritage			Liberty National			American Income			DTC			Total
Balance at January 1, 2023		$	3,046,829		$	3,005,664		$	941,574		$	312,750		$	87,532		$	7,394,349
Beginning balance at original discount rates		3,080,633			3,336,344			904,865			303,713			85,212			7,710,767
Effect of changes in assumptions on future cash flows		—			—			—			—			—			—
Effect of actual variances from expected experience		(31,443)			(19,779)			(15,995)			(1,578)			(2,302)			(71,097)
Adjusted balance at January 1, 2023		3,049,190			3,316,565			888,870			302,135			82,910			7,639,670
Issuances(1)		75,683			67,787			13,285			10,212			2,388			169,355
Interest accrual(2)		33,480			32,289			11,840			3,668			1,057			82,334
Benefit payments(3)		(78,563)			(29,261)			(23,976)			(7,137)			(3,354)			(142,291)

Effect of changes in the foreign exchange rate		—			—			—			(708)			—			(708)
Ending balance at original discount rates		3,079,790			3,387,380			890,019			308,170			83,001			7,748,360
Effect of change from original to current discount rates		52,672			(212,708)			59,977			18,363			4,089			(77,607)
Balance at March 31, 2023		$	3,132,462		$	3,174,672		$	949,996		$	326,533		$	87,090		$	7,670,753





Balance at January 1, 2024	$	3,814,328	$	3,315,880	$	865,808	$	335,504	$	109,482	$	8,441,002
Beginning balance at original discount rates	3,741,530		3,506,689		816,819		315,431		104,501		8,484,970
Effect of changes in assumptions on future cash flows	—		—		—		—		—		—
Effect of actual variances from expected experience	(40,325)		(19,049)		(12,821)		(4,002)		(2,321)		(78,518)
Adjusted balance at January 1, 2024	3,701,205		3,487,640		803,998		311,429		102,180		8,406,452
Issuances(1)	104,431		64,008		13,349		9,949		4,598		196,335
Interest accrual(2)	43,444		35,663		10,833		3,937		1,368		95,245
Benefit payments(3)	(82,085)		(33,037)		(23,864)		(6,402)		(3,096)		(148,484)

Effect of changes in the foreign exchange rate	—		—		—		(1,548)		—		(1,548)
Ending balance at original discount rates	3,766,995		3,554,274		804,316		317,365		105,050		8,548,000
Effect of change from original to current discount rates	(10,461)		(282,670)		29,690		11,418		2,725		(249,298)
Balance at March 31, 2024	$	3,756,534	$	3,271,604	$	834,006	$	328,783	$	107,775	$	8,298,702

(1)Issuances represent the present value, using the original discount rate, of the expected future policy benefits related to new policies issued during each respective period.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)


	Health(2)
	Net liability for future policy benefits as of March 31, 2023
	United American		Family Heritage		Liberty National		American Income		Direct to Consumer		Total
Net liability for future policy benefits at original discount rates	$	131,149	$	1,636,912	$	485,372	$	110,724	$	(2,965)	$	2,361,192
Effect of changes in discount rate assumptions	3,590		(126,654)		43,177		15,143		(188)		(64,932)
Other Adjustments(1)	5,380		490		5,776		333		4,162		16,141
Net liability for future policy benefits, after other adjustments, at current discount rates	140,119		1,510,748		534,325		126,200		1,009		2,312,401
Reinsurance recoverable	(3,609)		(9,852)		(1,428)		—		—		(14,889)
Net liability for future policy benefits, after reinsurance recoverable, at current discount rates	$	136,510	$	1,500,896	$	532,897	$	126,200	$	1,009	$	2,297,512

(1)Other adjustments include the effects of capping and flooring the liability.

(2)Includes the immaterial error correction noted below.


	Health
	Net liability for future policy benefits as of March 31, 2024
	United American		Family Heritage		Liberty National		American Income		Direct to Consumer		Total
Net liability for future policy benefits at original discount rates	105,547		1,752,482		462,151		113,515		(5,813)		2,427,882
Effect of changes in discount rate assumptions	(2,408)		(174,904)		26,414		11,473		(291)		(139,716)
Other Adjustments(1)	14,449		444		11,254		749		6,838		33,734
Net liability for future policy benefits, after other adjustments, at current discount rates	117,588		1,578,022		499,819		125,737		734		2,321,900
Reinsurance recoverable	(3,096)		(10,577)		(1,224)		—		—		(14,897)
Net liability for future policy benefits, after reinsurance recoverable, at current discount rates	$	114,492	$	1,567,445	$	498,595	$	125,737	$	734	$	2,307,003

(1)Other adjustments include the effects of capping and flooring the liability.

Immaterial Correction of Previously Issued Financial Statements—The Company previously presented reinsurance recoverable on a net basis as a component of future policy benefits. In the fourth quarter of 2023, the Company corrected its presentation of reinsurance recoverable to a gross basis as a component of other assets, which resulted in the reclassification of $60 million of reinsurance recoverable at current discount rates from liabilities to assets ($49 million at original discount rates) as of March 31, 2023, with no change to equity, and the related tables in the footnote have been adjusted to reflect such changes.

Remeasurement Gain or Loss—During the three months ended March 31, 2024 and 2023, the Company's results for actual variances from expected experience produced a net reserve remeasurement gain of $8.1 million and a net reserve remeasurement gain of $659 thousand, respectively, in the Condensed Consolidated Statements of Operations. The variance of actual experience from expected experience during the first three months of 2024 was primarily due to favorable variances from our assumptions as compared to actual experience in our life insurance segment (a $4.9 million gain), and favorable variances from our assumptions as compared to actual experience in our health insurance segment (a $3.2 million gain). The variance of actual experience from expected experience during the three months ended 2023 was primarily due to favorable variances from assumptions as compared to actual experience in our life insurance segment (a $2.7 million gain), and unfavorable variances from assumptions as compared to actual experience in our health insurance segment (a $2.0 million loss).

There were no changes to the judgments, assumptions, and methods used in measuring the liability for future policy benefits during the three months ended March 31, 2024 and 2023.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following table reconciles the liability for future policy benefits to the Condensed Consolidated Balance Sheets as of March 31, 2024 and 2023:



	At Original Discount Rates				At Current Discount Rates
	As of March 31,				As of March 31,
	2024		2023(2)		2024		2023(2)
Life(1):
American Income	$	4,620,358	$	4,247,898	$	5,305,709	$	5,169,921
Direct to Consumer	3,030,353		2,844,707		3,558,505		3,518,676
Liberty National	2,265,329		2,213,819		2,402,951		2,438,946
Other	3,085,512		2,978,885		3,639,808		3,683,543
Net liability for future policy benefits—long duration life	13,001,552		12,285,309		14,906,973		14,811,086

Health(1):
United American	117,042		134,455		117,588		140,119
Family Heritage	1,752,138		1,637,015		1,578,022		1,510,748
Liberty National	472,140		489,917		499,819		534,325
American Income	114,146		111,096		125,737		126,200
Direct to Consumer	707		961		734		1,009
Net liability for future policy benefits—long duration health	2,456,173		2,373,444		2,321,900		2,312,401

Deferred profit liability	174,605		177,248		174,605		177,248
Deferred annuity	739,019		907,797		739,019		907,797
Interest sensitive life	729,721		737,900		729,721		737,900
Other	9,810		10,067		9,805		10,066
Total future policy benefits	$	17,110,880	$	16,491,765	$	18,882,023	$	18,956,498

(1)Balances are presented net of the effects of capping and flooring the liability.

(2)Includes the immaterial error correction for reinsurance as noted above.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following tables provide the weighted-average original and current discount rates for the liability for future policy benefits and the additional insurance liabilities as of March 31, 2024 and 2023:


	As of March 31,
	2024				2023
	Original discount rate		Current discount rate		Original discount rate		Current discount rate
Life
American Income	5.7	%	5.2	%	5.8	%	4.9	%
Direct to Consumer	6.0	%	5.2	%	6.0	%	5.0	%
Liberty National	5.6	%	5.2	%	5.6	%	5.0	%
Other	6.2	%	5.2	%	6.2	%	5.0	%

Health
United American	5.1	%	5.0	%	5.2	%	4.8	%
Family Heritage	4.2	%	5.1	%	4.3	%	4.9	%
Liberty National	5.8	%	5.2	%	5.8	%	4.9	%
American Income	5.8	%	5.0	%	5.9	%	4.8	%
Direct to Consumer	5.1	%	5.0	%	5.2	%	4.8	%

The following table provides the weighted-average durations of the liability for future policy benefits and the additional insurance liabilities as of March 31, 2024 and 2023:


		As of March 31,
	2024			2023
		At original discount rates	At current discount rates		At original discount rates	At current discount rates
Life
American Income		23.05	23.33		22.90	23.33
Direct to Consumer		19.57	21.01		20.24	21.82
Liberty National		15.16	15.60		14.94	15.63
Other		16.18	17.59		16.52	18.23

Health
United American		11.53	10.74		11.40	10.80
Family Heritage		15.07	14.34		14.91	14.43
Liberty National		9.23	9.39		9.31	9.66
American Income		12.28	12.67		12.15	12.74
Direct to Consumer		11.53	10.74		11.40	10.80

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following tables summarize the amount of gross premiums and interest related to long duration life and health contracts that are recognized in the Condensed Consolidated Statements of Operations for the three month periods ended March 31, 2024 and 2023:


	Life
	Three Months Ended March 31, 2024				Three Months Ended March 31, 2023
	Gross Premiums		Interest expense		Gross Premiums		Interest expense
American Income	$	413,759	$	66,379	$	387,145	$	61,431
Direct to Consumer	245,194		44,460		244,707		41,714
Liberty National	89,871		30,542		84,072		29,769
Other	51,069		45,917		51,835		44,275
Total	$	799,893	$	187,298	$	767,759	$	177,189


	Health
	Three Months Ended March 31, 2024				Three Months Ended March 31, 2023
	Gross Premiums		Interest expense		Gross Premiums		Interest expense
United American	$	104,097	$	1,567	$	97,833	$	1,822
Family Heritage	103,391		17,431		96,090		15,977
Liberty National	47,434		6,583		46,745		6,920
American Income	28,919		1,655		28,096		1,632
Direct to Consumer	3,657		—		3,542		—
Total	$	287,498	$	27,236	$	272,306	$	26,351

Gross premiums are included within life and health premium on the Condensed Consolidated Statements of Operations, while the related interest expense is included in life and health policyholder benefits.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following tables provide the undiscounted and discounted expected future net premiums, expected future gross premiums, and expected future policy benefits, at both original and current discount rates, for life and health contracts as of March 31, 2024 and 2023:


	Life
	As of March 31, 2024						As of March 31, 2023
	Not discounted		At original discount rates		At current discount rates		Not discounted		At original discount rates		At current discount rates
American Income
PV of expected future gross premiums	$	24,668,992	$	13,924,819	$	14,181,177	$	23,041,514	$	13,054,486	$	13,575,751
PV of expected future net premiums	8,131,005		4,596,138		4,652,671		7,617,532		4,325,957		4,467,637
PV of expected future policy benefits	31,114,756		9,216,265		9,958,093		28,821,998		8,573,734		9,637,463

DTC
PV of expected future gross premiums	$	17,617,001	$	9,214,360	$	9,597,417	$	17,479,516	$	9,165,113	$	9,773,835
PV of expected future net premiums	10,831,408		5,698,050		5,945,259		10,832,386		5,718,900		6,110,550
PV of expected future policy benefits	25,909,464		8,728,403		9,500,215		25,582,750		8,563,604		9,624,680

Liberty National
PV of expected future gross premiums	$	4,667,397	$	2,725,502	$	2,739,275	$	4,453,139	$	2,599,082	$	2,667,795
PV of expected future net premiums	1,888,084		1,073,485		1,102,209		1,889,419		1,070,775		1,128,083
PV of expected future policy benefits	8,916,134		3,340,412		3,499,742		8,658,766		3,284,594		3,559,012

Other
PV of expected future gross premiums	$	3,701,248	$	1,879,815	$	2,027,187	$	3,798,669	$	1,920,302	$	2,126,949
PV of expected future net premiums	906,921		442,392		464,169		919,924		448,677		483,056
PV of expected future policy benefits	12,437,133		3,527,882		4,103,892		12,392,224		3,427,535		4,166,527

Total
PV of expected future gross premiums	$	50,654,638	$	27,744,496	$	28,545,056	$	48,772,838	$	26,738,983	$	28,144,330
PV of expected future net premiums	21,757,418		11,810,065		12,164,308		21,259,261		11,564,309		12,189,326
PV of expected future policy benefits	78,377,487		24,812,962		27,061,942		75,455,738		23,849,467		26,987,682

As of March 31, 2024, for the life segment using current discount rates, the Company anticipates $28.5 billion of expected future gross premiums and $12.2 billion of expected future net premiums. As of March 31, 2023, using current discount rates, the Company anticipated $28.1 billion of expected future gross premiums and $12.2 billion in expected future net premiums. For each respective period, only expected future net premiums are included in the determination of the liability for future policy benefits on the balance sheet, while the difference between the expected future gross premiums and the expected future net premiums is not.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)


	Health
	As of March 31, 2024						As of March 31, 2023
	Not discounted		At original discount rates		At current discount rates		Not discounted		At original discount rates		At current discount rates
United American
PV of expected future gross premiums	$	8,757,778	$	5,349,917	$	5,334,881	$	6,783,819	$	4,279,547	$	4,346,007
PV of expected future net premiums	6,002,434		3,661,448		3,653,395		4,685,306		2,948,641		2,997,723
PV of expected future policy benefits	6,186,167		3,766,995		3,756,534		4,909,212		3,079,790		3,132,462

Family Heritage
PV of expected future gross premiums	$	6,854,106	$	4,037,762	$	3,816,256	$	6,442,316	$	3,846,392	$	3,682,300
PV of expected future net premiums	3,039,406		1,801,792		1,694,026		2,908,079		1,750,468		1,664,414
PV of expected future policy benefits	6,769,500		3,554,274		3,271,604		6,358,594		3,387,380		3,174,672

Liberty National
PV of expected future gross premiums	$	2,073,015	$	1,315,879	$	1,353,262	$	2,232,290	$	1,396,334	$	1,468,763
PV of expected future net premiums	509,069		342,165		345,441		634,061		404,647		421,447
PV of expected future policy benefits	1,395,561		804,316		834,006		1,575,745		890,019		949,996

American Income
PV of expected future gross premiums	$	1,768,477	$	991,946	$	1,024,262	$	1,760,671	$	984,216	$	1,037,339
PV of expected future net premiums	362,982		203,850		203,795		351,655		197,446		200,666
PV of expected future policy benefits	644,293		317,365		328,783		626,151		308,170		326,533

Direct to Consumer
PV of expected future gross premiums	$	238,499	$	150,065	$	154,223	$	171,266	$	112,442	$	118,105
PV of expected future net premiums	176,500		110,863		113,879		131,187		85,966		90,243
PV of expected future policy benefits	164,347		105,050		107,775		124,597		83,001		87,090

Total
PV of expected future gross premiums	$	19,691,875	$	11,845,569	$	11,682,884	$	17,390,362	$	10,618,931	$	10,652,514
PV of expected future net premiums	10,090,391		6,120,118		6,010,536		8,710,288		5,387,168		5,374,493
PV of expected future policy benefits	15,159,868		8,548,000		8,298,702		13,594,299		7,748,360		7,670,753

As of March 31, 2024, for the health segment using current discount rates, the Company anticipates $11.7 billion of expected future gross premiums and $6.0 billion of expected future net premiums. As of March 31, 2023, using current discount rates, the Company anticipated $10.6 billion of expected future gross premiums and $5.4 billion in expected future net premiums. For each respective period, only expected future net premiums are included in the determination of the liability for future policy benefits on the balance sheet, while the difference between the expected future gross premiums and the expected future net premiums is not.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following table summarizes the balances of, and changes in, policyholders’ account balances as of March 31, 2024 and 2023:


	Policyholders' Account Balances
	As of March 31, 2024						As of March 31, 2023
	Interest Sensitive Life		Deferred Annuity		Other Policy-holders' Funds		Interest Sensitive Life		Deferred Annuity		Other Policy-holders' Funds
Balance at January 1,	$	732,948	$	773,039	$	236,958	$	739,105	$	954,318	$	123,236
Issuances	—		198		—		—		202		—
Premiums received	5,624		3,573		166,700		6,030		4,776		21,662
Policy charges	(3,111)		—		—		(3,319)		—		—
Surrenders and withdrawals	(6,309)		(31,563)		(3,517)		(5,384)		(43,533)		(3,303)
Benefit payments	(9,140)		(12,771)		—		(7,844)		(15,784)		—

Interest credited	7,016		6,243		3,521		7,135		7,560		1,238
Other	2,693		300		(2,393)		2,177		258		(147)
Balance at March 31,	$	729,721	$	739,019	$	401,269	$	737,900	$	907,797	$	142,686


Weighted-average credit rate	3.89		%	3.34		%	4.49		%	3.92		%	3.29		%	3.78		%
Net amount at risk	$	1,740,325		N/A			N/A			$	1,847,128		N/A			N/A
Cash surrender value	$	669,721		$	739,019		$	401,269		$	676,247		$	907,797		$	142,686

The following tables present the policyholders' account balances by range of guaranteed minimum crediting rates and the related range of difference, if any, in basis points between rates being credited to policy holders and the respective guaranteed minimums as of March 31, 2024 and 2023:


	At March 31, 2024
Range of guaranteed minimum crediting rates	Interest Sensitive Life		Deferred Annuity		Other Policyholders' Funds
At guaranteed minimum
Less than 3.00%	$	—	$	1,796	$	303,935
3.00%-3.99%	29,176		545,598		3,521
4.00%-4.99%	610,643		191,625		6,745
Greater than 5.00%	89,902		—		37,384
Total	729,721		739,019		351,585






51-150 basis points above
Less than 3.00%	—		—		—
3.00%-3.99%	—		—		—
4.00%-4.99%	—		—		49,684
Greater than 5.00%	—		—		—
Total	—		—		49,684





Grand Total	$	729,721	$	739,019	$	401,269

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)


	At March 31, 2023
Range of guaranteed minimum crediting rates	Interest Sensitive Life		Deferred Annuity		Other Policyholders' Funds
At guaranteed minimum
Less than 3.00%	$	—	$	1,971	$	43,191
3.00%-3.99%	28,956		698,952		4,097
4.00%-4.99%	619,411		206,874		57,596
Greater than 5.00%	89,533		—		37,802
Total	$	737,900	$	907,797	$	142,686
51-150 basis points above
Less than 3.00%	$	—	$	—	$	—
3.00%-3.99%	—		—		—
4.00%-4.99%	—		—		—
Greater than 5.00%	—		—		—
Total	—		—		—






Grand Total	$	737,900	$	907,797	$	142,686

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Note 7—Deferred Acquisition Costs

The following tables roll forward the deferred policy acquisition costs for the three month periods ended March 31, 2024 and 2023:


	Life
	American Income		DTC		Liberty National		Other		Total





Balance at January 1, 2023	$	2,258,291	$	1,676,931	$	610,723	$	298,346	$	4,844,291
Capitalizations	115,395		47,410		24,221		3,321		190,347
Amortization expense	(38,299)		(24,753)		(12,412)		(4,125)		(79,589)
Foreign exchange adjustment	(2,787)		—		—		—		(2,787)

Balance at March 31, 2023	$	2,332,600	$	1,699,588	$	622,532	$	297,542	$	4,952,262






Balance at January 1, 2024	$	2,573,370	$	1,737,117	$	666,419	$	294,869	$	5,271,775
Capitalizations	127,443		42,125		26,065		3,013		198,646
Amortization expense	(42,976)		(25,058)		(13,599)		(4,135)		(85,768)
Foreign exchange adjustment	(5,828)		—		—		—		(5,828)

Balance at March 31, 2024	$	2,652,009	$	1,754,184	$	678,885	$	293,747	$	5,378,825


	Health
	United American		Family Heritage		Liberty National		American Income		DTC		Total





Balance at January 1, 2023	$	77,394	$	416,608	$	133,096	$	57,811	$	1,854	$	686,763
Capitalizations	507		15,097		4,882		3,143		—		23,629
Amortization expense	(1,513)		(6,560)		(3,250)		(938)		(47)		(12,308)
Foreign exchange adjustment	—		—		—		(126)		—		(126)

Balance at March 31, 2023	$	76,388	$	425,145	$	134,728	$	59,890	$	1,807	$	697,958
















Balance at January 1, 2024	$	73,489	$	452,843	$	139,941	$	66,783	$	1,679	$	734,735
Capitalizations	496		16,690		7,979		3,530		1		28,696
Amortization expense	(1,381)		(7,187)		(3,607)		(1,099)		(37)		(13,311)
Foreign exchange adjustment	—		—		—		(276)		—		(276)

Balance at March 31, 2024	$	72,604	$	462,346	$	144,313	$	68,938	$	1,643	$	749,844

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following table presents a reconciliation of deferred policy acquisition costs to the Condensed Consolidated Balance Sheets as of March 31, 2024:


		March 31,
	2024			2023
Life
American Income		$	2,652,009		$	2,332,600
Direct to Consumer		1,754,184			1,699,588
Liberty National		678,885			622,532
Other		293,747			297,542
Total DAC—Life		5,378,825			4,952,262

Health
United American		72,604			76,388
Family Heritage		462,346			425,145
Liberty National		144,313			134,728
American Income		68,938			59,890
Direct to Consumer		1,643			1,807
Total DAC—Health		749,844			697,958

Annuity		2,568			4,218
Total		$	6,131,237		$	5,654,438

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Note 8—Liability for Unpaid Claims

Activity in the liability for unpaid health claims is summarized as follows:


	March 31, 2024		December 31, 2023

Balance at beginning of period	$	194,809	$	184,286
Less reinsurance recoverables	(2,157)		(2,084)
Net balance at beginning of period	192,652		182,202
Incurred related to:
Current year	184,167		697,521
Prior years	188		(4,853)
Total incurred	184,355		692,668
Paid related to:
Current year	74,254		535,971
Prior years	103,375		146,247
Total paid	177,629		682,218
Net balance at end of period	199,378		192,652
Plus reinsurance recoverables	1,667		2,157
Balance at end of period	$	201,045	$	194,809

Below is the reconciliation of the liability of "Policy claims and other benefits payable" in the Condensed Consolidated Balance Sheets.


	March 31, 2024		December 31, 2023

Policy claims and other benefits payable:
Life insurance	$	319,049	$	320,066
Health insurance	201,045		194,809
Total	$	520,094	$	514,875

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Note 9—Postretirement Benefits

Globe Life has qualified noncontributory defined benefit pension plans (Pension Plans) and contributory savings plans that cover substantially all employees. There is also a nonqualified noncontributory supplemental executive retirement plan (SERP) that covers a limited number of officers. The tables included herein will focus on the Pension Plans and SERP.

Pension Assets: The following table presents the assets of the Company's Pension Plans at March 31, 2024 and December 31, 2023.

Pension Assets by Component at March 31, 2024


	Fair Value Determined by:
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Amount		% of Total

Exchange traded fund(4)	$	26,481	$	—	$	—	$	26,481	5





Equity exchange traded fund(1)	330,810		—		—		330,810		56
U.S. Government and Agency	—		159,108		—		159,108		27
Other bonds	—		4		—		4		—
Guaranteed annuity contract(2)	—		43,602		—		43,602		7
Short-term investments	3,016		—		—		3,016		1
Other	1,487		—		—		1,487		—
	$	361,794	$	202,714	$	—	564,508		96
Other long-term investments(3)							23,670		4
Total pension assets							$	588,178	100

(1)A fund including marketable securities that mirror the S&P 500 index.

(2)Representing a guaranteed annuity contract issued by Globe Life Inc.'s subsidiary, American Income Life Insurance Company, to fund the obligations of the American Income Life Insurance Company Collective Bargaining Agreement Employees Pension Plan.

(3)Includes non-redeemable investment funds that report the Globe Life Inc. Pension Plan's pro-rata share of the limited partnership's net asset value (NAV) per share, or its equivalent, as a practical expedient for fair value. As of March 31, 2024, the Globe Life Inc. Pension Plan owned less than 1% of two long-term investment funds.

(4)A fund including U.S. dollar-denominated investment-grade securities issued by industrial, utility, and financial companies with maturities greater than 10 years.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Pension Assets by Component at December 31, 2023


	Fair Value Determined by:
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Amount		% of Total

Exchange traded fund(4)	$	18,715	$	—	$	—	$	18,715	3





Equity exchange traded fund(1)	315,886		—		—		315,886		55
U.S. Government and Agency	—		167,450		—		167,450		30
Other bonds	—		5		—		5		—
Guaranteed annuity contract(2)	—		43,428		—		43,428		8
Short-term investments	6,506		—		—		6,506		1
Other	463		—		—		463		—
	$	341,570	$	210,883	$	—	552,453		97
Other long-term investments(3)							18,314		3
Total pension assets							$	570,767	100

(1)A fund including marketable securities that mirror the S&P 500 index.

(3)Includes non-redeemable investment funds that report the Globe Life Inc. Pension Plan's pro-rata share of the limited partnership's net asset value (NAV) per share, or its equivalent, as a practical expedient for fair value. As of December 31, 2023, the Globe Life Inc. Pension Plan owned less than 1% of two long-term investment funds.

(4)A fund including U.S. dollar-denominated investment-grade securities issued by industrial, utility, and financial companies with maturities greater than 10 years.

SERP: The following tables include premiums paid for the company owned life insurance (COLI) at March 31, 2024 and 2023 and investments of the Rabbi Trust at March 31, 2024 and December 31, 2023.


	Three Months Ended March 31,
	2024		2023
Premiums paid for insurance coverage	$	443	$	443

	March 31, 2024		December 31, 2023
Total investments:
COLI	$	55,974	$	55,185
Exchange traded funds	90,514		86,156
	$	146,488	$	141,341

Pension Plans and SERP Liabilities: The following table presents liabilities for the defined benefit pension plans and SERP at March 31, 2024 and December 31, 2023.


	March 31, 2024		December 31, 2023
Pension Plans	$	574,981	$	554,957
SERP	72,453		72,603
Benefit obligation	$	647,434	$	627,560

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Net Periodic Benefit Cost: The following table presents the net periodic benefit costs for the defined benefit pension plans and SERP by expense components for the three month periods ended March 31, 2024 and 2023.

Components of Net Periodic Benefit Cost


	Three Months Ended March 31,
		2024		2023
Service cost—benefits earned during the period		$	6,221	$	5,392
Interest cost on projected benefit obligation		8,267		7,834
Expected return on assets		(10,646)		(9,656)
Amortization:
Prior service cost		269		269
Actuarial (gain) loss		6		(52)


Net periodic benefit cost		$	4,117	$	3,787

Note 10—Earnings Per Share

Earnings per Share*:* A reconciliation of basic and diluted weighted-average shares outstanding used in the computation of basic and diluted earnings per share is as follows:


	Three Months Ended March 31,
		2024	2023
Basic weighted average shares outstanding		93,865,606	96,388,211
Weighted average dilutive options outstanding		1,248,909	1,522,889
Diluted weighted average shares outstanding		95,114,515	97,911,100

Antidilutive shares		186,359	209,870

Antidilutive shares are excluded from the calculation of diluted earnings per share. All antidilutive shares noted above result from outstanding out of the money employee and Director stock options.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

Note 11—Debt

The following table presents information about the terms and outstanding balances of Globe Life's debt.

Selected Information about Debt Issues


				As of
				March 31, 2024								December 31, 2023
Instrument	Issue Date	Maturity Date	Coupon Rate	Par Value		Unamortized Discount & Issuance Costs		Book Value		Fair Value		Book Value

Senior notes	09/27/2018	09/15/2028	4.550%	$	550,000	$	(3,538)	$	546,462	$	539,198	$	546,283
Senior notes	08/21/2020	08/15/2030	2.150%	400,000		(3,214)		396,786		334,816		396,670
Senior notes(1)	05/19/2022	06/15/2032	4.800%	250,000		(4,028)		245,972		242,950		245,873


Junior subordinated debentures	11/17/2017	11/17/2057	5.275%	125,000		(1,569)		123,431		123,538		123,427
Junior subordinated debentures	06/14/2021	06/15/2061	4.250%	325,000		(7,673)		317,327		270,010		317,306



Total long-term debt				1,650,000		(20,022)		1,629,978		1,510,512		1,629,559


Term loan(2)	05/11/2023	11/11/2024	6.680%	170,000		(324)		169,676		169,676		169,549
FHLB borrowings				242,000		—		242,000		242,000		—
Commercial paper				324,000		(2,132)		321,868		321,868		316,564
Total short-term debt				736,000		(2,456)		733,544		733,544		486,113

Total debt				$	2,386,000	$	(22,478)	$	2,363,522	$	2,244,056	$	2,115,672

(1)An additional $150 million par value and book value is held by insurance subsidiaries that eliminates in consolidation.

(2)Interest calculated quarterly using Secured Overnight Financing Rate (SOFR) plus 135 basis points.

The commercial paper has the highest priority of all unsecured debt, followed by senior notes then junior subordinated debentures. The senior notes are callable under a make-whole provision, and the junior subordinated debentures are subject to an optional redemption five years from issuance. Interest on the 4.25% junior subordinated debentures is payable quarterly while all other long-term debt is payable semi-annually.

Credit facility*:* On March 29, 2024, Globe Life amended the credit agreement dated September 30, 2021, which provides for a $1 billion revolving credit facility that may be increased to $1.25 billion. The amended credit facility matures March 29, 2029 and may be extended up to two one-year periods upon the Company's request. Pursuant to this agreement, the participating lenders have agreed to make revolving loans to Globe Life and to issue secured or unsecured letters of credit. The Company has not drawn on any of the credit to date.

The facility is further designated as a back-up credit line for a commercial paper program under which the Company may either borrow from the credit line or issue commercial paper at any time, with total commercial paper outstanding not to exceed the facility maximum of $1 billion, less any letters of credit issued. Interest is charged at variable rates. In accordance with the agreement, Globe Life is subject to certain covenants regarding capitalization. As of March 31, 2024, the Company was in full compliance with these covenants.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following tables present certain information about our commercial paper borrowings.

Credit Facility—Commercial Paper

(Dollar amounts in thousands)


	At
	March 31, 2024			December 31, 2023			March 31, 2023
Balance of commercial paper at end of period (par value)	$	324,000		$	319,000		$	305,000
Annualized interest rate	5.63		%	5.71		%	5.28		%
Letters of credit outstanding	$	115,000		$	115,000		$	115,000
Remaining amount available under credit line	561,000			316,000			330,000

Credit Facility—Commercial Paper Activity

(Dollar amounts in thousands)


	Three Months Ended March 31,
	2024			2023
Average balance of commercial paper outstanding during period (par value)	$	346,088		$	293,892
Daily-weighted average interest rate (annualized)	5.68		%	4.95		%
Maximum daily amount outstanding during period (par value)	$	384,000		$	477,700
Commercial paper issued during period (par value)	404,000			545,000
Commercial paper matured during period (par value)	(399,000)			(525,000)
Net commercial paper issued (matured) during period (par value)	5,000			20,000

Federal Home Loan Bank (FHLB)**: FHLB membership provides our insurance subsidiaries with access to various low-cost collateralized borrowings and funding agreements. The membership requires ownership of FHLB common stock, as well as the purchase of activity-based common stock equal to approximately 4.1% of outstanding borrowings.

Globe Life owned $34.3 million in FHLB common stock as of March 31, 2024 and $22.3 million as of December 31, 2023. The FHLB stock is restricted for the duration of the membership and recorded at cost (par) as required by applicable guidance. The FHLB stock is included in "Other long-term investments*"* in the Condensed Consolidated Balance Sheets. Borrowings with the FHLB are subject to the availability of pledged assets at the insurance subsidiaries of Globe Life. As of March 31, 2024, Globe Life's insurance subsidiaries maximum borrowing capacity under the FHLB facility was approximately $589 million, net of outstanding funding agreements and short-term borrowings, on pledged assets with a fair value of $1.4 billion. As of March 31, 2024, $303 million in funding agreements were outstanding with the FHLB, compared to $138 million as of December 31, 2023. This amount is included in "Other policyholders' funds" in the Condensed Consolidated Balance Sheets. In addition, the Company had $242 million in short-term borrowings from the FHLB as of March 31, 2024, compared to $0 as of December 31, 2023, this amount is recorded in "Short-term debt".

Note 12—Business Segments

Globe Life is organized into four segments: life insurance, supplemental health insurance, annuities, and investments. In addition, other expenses not included in these segments are reported in "Corporate & Other."

Globe Life's reportable insurance segments are based on the insurance product lines it markets and administers: life insurance, supplemental health insurance, and annuities. These major product lines are set out as reportable segments because of the common characteristics of products within these categories, comparability of margins, and

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

the similarity in regulatory environment and management techniques. There is also an investment segment that manages the investment portfolio and cash flow for the insurance segments and the corporate function, which excludes the interest on deferred acquisition costs. The Company's chief operating decision makers evaluate the overall performance of the operations of the Company in accordance with these segments.

Life insurance products marketed by Globe Life include traditional whole life and term life insurance. An immaterial amount of annuities sold as companion products are included in the life segment. Health insurance products are generally guaranteed renewable and include Medicare Supplement, cancer, critical illness, accident, and other limited-benefit supplemental hospital and surgical products. Annuities include fixed-benefit contracts.

The following tables present segment premium revenue by each of Globe Life's distribution channels.


	Premium Income by Distribution Channel

	Three Months Ended March 31, 2024
	Life			Health			Annuity			Total
Distribution Channel	Amount		% of Total	Amount		% of Total	Amount		% of Total	Amount		% of Total
American Income	$	414,044	52	$	30,497	9	$	—	—	$	444,541	39
Direct to Consumer	248,040		31	17,866		5	—		—	265,906		23
Liberty National	90,777		11	47,630		14	—		—	138,407		12
United American	1,843		—	141,635		42	—		—	143,478		13
Family Heritage	1,616		—	103,391		30	—		—	105,007		9
Other	47,945		6	—		—	—		—	47,945		4
	$	804,265	100	$	341,019	100	$	—	—	$	1,145,284	100


	Three Months Ended March 31, 2023
	Life			Health			Annuity			Total
Distribution Channel	Amount		% of Total	Amount		% of Total	Amount		% of Total	Amount		% of Total
American Income	$	387,512	50	$	29,594	9	$	—	—	$	417,106	38
Direct to Consumer	247,667		32	17,248		5	—		—	264,915		24
Liberty National	85,203		11	46,972		15	—		—	132,175		12
United American	1,882		—	132,607		41	—		—	134,489		12
Family Heritage	1,480		—	96,072		30	—		—	97,552		9
Other	48,853		7	—		—	—		—	48,853		5
	$	772,597	100	$	322,493	100	$	—	—	$	1,095,090	100

Due to the nature of the life insurance industry, Globe Life has no individual or group that would be considered a major customer. Substantially all of Globe Life's business is conducted in the United States.

The measure of profitability established by the chief operating decision makers for the insurance segments is underwriting margin before other income and administrative expenses, in accordance with the manner in which the segments are managed. It essentially represents gross profit margin on insurance products before insurance administrative expenses and consists primarily of premium less net policy benefits, acquisition expenses, and commissions. Required interest on policy liabilities is reflected as a component of the Investment segment (rather than as a component of underwriting margin in the insurance and annuity segments) in order to match this cost with the investment income earned on the assets supporting the policy liabilities.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The measure of profitability for the Investment segment is excess investment income, representing the income earned on the investment portfolio in excess of policy requirements. Other than the required interest on the insurance segments, no other intersegment revenues or expenses are recognized. Expenses directly attributable to corporate operations are included in the “Corporate & Other” category. Stock-based compensation expense is considered a corporate expense by Globe Life management and is included in this category. All other unallocated revenues and expenses on a pretax basis, including insurance administrative expense and interest on debt, are also included in the “Corporate & Other” segment category.

Globe Life holds a sizable investment portfolio to support its insurance liabilities, the yield from which is used to offset policy benefit, acquisition, administrative, and tax expenses. This yield or investment income is taken into account when establishing premium rates and profitability expectations for its insurance products. From time to time, investments are sold or called, or experience a credit loss event, each of which are reflected by the Company as realized gain (loss)—investments. These gains or losses generally occur as a result of disposition due to issuer calls, compliance with Company investment policies, or other reasons often beyond management’s control. Unlike investment income, realized gains and losses are incidental to insurance operations, and only overall yields are considered when setting premium rates or insurance product profitability expectations. While these gains and losses are not relevant to segment profitability or core operating results, they can have a material positive or negative result on net income. For these reasons, management removes realized investment gains and losses when it views its segment operations.

Management also removes non-operating items unrelated to the Company's core insurance activities when evaluating those results. Therefore, these items are excluded in its presentation of segment results because accounting guidance requires that operating segment results be presented as management views its business. All of these items are included in “Other operating expense” in the Condensed Consolidated Statements of Operations for the appropriate year. See additional detail below in the tables.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)

The following tables set forth a reconciliation of Globe Life's revenues and operations by segment to its major income statement line items. See Note 1—Significant Accounting Policies for additional information concerning reconciling items of segment profits to pretax income.


	Three Months Ended March 31, 2024
	Life		Health		Annuity		Investment		Corporate & Other		Adjustments			Consolidated
Revenue:
Premium	$	804,265	$	341,019	$	—	$	—	$	—	$	—		$	1,145,284
Net investment income	—		—		—		282,578		—		—			282,578
Other income	—		—		—		—		76		—			76
Total revenue	804,265		341,019		—		282,578		76		—			1,427,938
Expenses:
Policy benefits	519,871		202,327		6,127		3,468		—		—			731,793
Required interest on reserves	(199,707)		(27,173)		(8,445)		235,325		—		—			—

Amortization of acquisition costs	85,768		13,311		399		—		—		—			99,478
Commissions, premium taxes, and non-deferred acquisition costs	89,322		58,784		4		—		—		—			148,110
Insurance administrative expense(1)	—		—		—		—		80,411		—			80,411
Parent expense	—		—		—		—		2,826		710		(2)	3,536
Stock-based compensation expense	—		—		—		—		9,267		—			9,267
Interest expense	—		—		—		—		28,621		—			28,621
Total expenses	495,254		247,249		(1,915)		238,793		121,125		710			1,101,216
Subtotal	309,011		93,770		1,915		43,785		(121,049)		(710)			326,722
Non-operating items	—		—		—		—		—		710		(2)	710
Measure of segment profitability (pretax)	$	309,011	$	93,770	$	1,915	$	43,785	$	(121,049)	$	—		327,432

Realized gains (losses)														(11,799)


Non-operating expenses														(710)
Income before income taxes per Condensed Consolidated Statements of Operations														$	314,923

(1)Administrative expense is not allocated to insurance segments.

(2)Non-operating expenses.

GL Q1 2024 FORM 10-Q

Globe Life Inc.

Notes to Condensed Consolidated Financial Statements

(Dollar amounts in thousands, except per share data)


	Three Months Ended March 31, 2023
	Life		Health		Annuity		Investment		Corporate & Other		Adjustments		Consolidated
Revenue:
Premium	$	772,597	$	322,493	$	—	$	—	$	—	$	—	$	1,095,090
Net investment income	—		—		—		257,105		—		—		257,105
Other income	—		—		—		—		50		—		50
Total revenue	772,597		322,493		—		257,105		50		—		1,352,245
Expenses:
Policy obligations	507,977		190,962		7,541		1,447		—		—		707,927
Required interest on reserves	(189,821)		(26,323)		(10,259)		226,403		—		—		—

Amortization of acquisition costs	79,589		12,308		425		—		—		—		92,322
Commissions, premium taxes, and non-deferred acquisition costs	83,578		54,214		5		—		—		—		137,797
Insurance administrative expense(1)	—		—		—		—		73,907		—		73,907
Parent expense	—		—		—		—		2,585				2,585
Stock-based compensation expense	—		—		—		—		7,679		—		7,679
Interest expense	—		—		—		—		24,867		—		24,867
Total expenses	481,323		231,161		(2,288)		227,850		109,038		—		1,047,084
Subtotal	291,274		91,332		2,288		29,255		(108,988)		—		305,161
Non-operating items	—		—		—		—		—		—		—
Measure of segment profitability (pretax)	$	291,274	$	91,332	$	2,288	$	29,255	$	(108,988)	$	—	305,161

Realized gains (losses)													(30,927)



Income before income taxes per Condensed Consolidated Statements of Operations													$	274,234

(1)Administrative expense is not allocated to insurance segments.

GL Q1 2024 FORM 10-Q

CAUTIONARY STATEMENTS

We caution readers regarding certain forward-looking statements contained in the foregoing discussion and elsewhere in this document, and in any other statements made by, or on behalf of Globe Life whether or not in future filings with the Securities and Exchange Commission. Any statement that is not a historical fact, or that might otherwise be considered an opinion or projection concerning the Company or its business, whether express or implied, is meant as and should be considered a forward-looking statement. Such statements represent management's opinions concerning future operations, strategies, financial results or other developments. We specifically disclaim any obligation to update or revise any forward-looking statement because of new information, future developments, or otherwise.

Forward-looking statements are based upon estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond our control, including uncertainties related to the impact of the recent pandemic and associated direct and indirect effects on our business operations, financial results, and financial condition. If these estimates or assumptions prove to be incorrect, the actual results of Globe Life may differ materially from the forward-looking statements made on the basis of such estimates or assumptions. Whether or not actual results differ materially from forward-looking statements may depend on numerous foreseeable and unforeseeable events or developments, which may be national in scope, related to the insurance industry generally, or applicable to the Company specifically. Such events or developments could include, but are not necessarily limited to:

1.Economic and other conditions, including the continued impact of inflation, geopolitical events, and the recent pandemic on the U.S. economy, leading to unexpected changes in lapse rates and/or sales of our policies, as well as levels of mortality, morbidity, and utilization of health care services that differ from Globe Life's assumptions;

2.Regulatory developments, including changes in accounting standards or governmental regulations (particularly those impacting taxes and changes to the Federal Medicare program that would affect Medicare Supplement);

3.Market trends in the senior-aged health care industry that provide alternatives to traditional Medicare (such as Health Maintenance Organizations and other managed care or private plans) and that could affect the sales of traditional Medicare Supplement insurance;

4.Interest rate changes that affect product sales, financing costs, and/or investment portfolio yield;

5.General economic, industry sector or individual debt issuers’ financial conditions (including developments and volatility arising from geopolitical events, particularly in certain industries that may comprise part of our investment portfolio) that may affect the current market value of securities we own, or that may impair an issuer’s ability to make principal and/or interest payments due on those securities;

6.Changes in the competitiveness of the Company's products and pricing;

7.Litigation results;

8.Levels of administrative and operational efficiencies that differ from our assumptions (including any reduction in efficiencies resulting from increased costs arising from the impact of higher than anticipated inflation);

9.The ability to obtain timely and appropriate premium rate increases for health insurance policies from our regulators;

10.The customer response to new products and marketing initiatives;

11.Reported amounts in the consolidated financial statements which are based on management estimates and judgments which may differ from the actual amounts ultimately realized;

12.Compromise by a malicious actor or other event that causes a loss of secure data from, or inaccessibility to, our computer and other information technology systems;

13.The impact of reputational damage on the Company's ability to attract and retain agents;

14.The severity, magnitude, and impact of natural or man-made catastrophic events, including but not limited to pandemics, tornadoes, hurricanes, earthquakes, war and terrorism, on our operations and personnel, commercial activity, level of claims, and demand for our products; and

15.Globe Life's ability to access the commercial paper and debt markets, particularly if such markets become unpredictable or unstable for a certain period.

Readers are also directed to consider other risks and uncertainties described in other documents on file with the Securities and Exchange Commission.

GL Q1 2024 FORM 10-Q

GLOBE LIFE INC.

Management's Discussion & Analysis

Previous: Cover and table of contents · Next: Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations