10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 10-Q

___________________________

x Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2014

or

¨ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from  _____ to _____

Commission File Number:  000-16509

CITIZENS, INC.

(Exact name of registrant as specified in its charter)

Colorado	84-0755371
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
400 East Anderson Lane, Austin, TX	78752
(Address of principal executive offices)	(Zip Code)

(512) 837-7100

(Registrant's telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes ¨ No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). x Yes o No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  (Check one):
Large accelerated filer ¨	Accelerated filer x	Non-accelerated filer ¨	Smaller reporting company ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ¨ Yes x No

As of May 1, 2014, the Registrant had 49,080,114 shares of Class A common stock, no par value, outstanding and 1,001,714 shares of Class B common stock outstanding.

THIS PAGE INTENTIONALLY LEFT BLANK

TABLE OF CONTENTS

			Page Number
Part I.	Financial Information
	Item 1.	Financial Statements
		Consolidated Statements of Financial Position, March 31, 2014 (Unaudited) and December 31, 2013	2
		Consolidated Statements of Comprehensive Income, Three Months Ended March 31, 2014 and 2013 (Unaudited)	4
		Consolidated Statements of Cash Flows, Three Months Ended March 31, 2014 and 2013 (Unaudited)	5
		Notes to Consolidated Financial Statements	7
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	23
	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	43
	Item 4.	Controls and Procedures	44
Part II.	Other Information
	Item 1.	Legal Proceedings	45
	Item 1A.	Risk Factors	45
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	45
	Item 3.	Defaults Upon Senior Securities	45
	Item 4.	Mine Safety Disclosures	45
	Item 5.	Other Information	45
	Item 6.	Exhibits	46

1

PART I.  FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Consolidated Statements of Financial Position (In thousands)
	March 31, 2014		December 31, 2013
Assets	(Unaudited)
Investments:
Fixed maturities available-for-sale, at fair value (cost:  $621,480 and $595,944 in 2014 and 2013, respectively)	$	644,759	605,256
Fixed maturities held-to-maturity, at amortized cost (fair value:  $225,087 and $223,533 in 2014 and 2013, respectively)	223,586		227,696
Equity securities available-for-sale, at fair value (cost:  $48,133 and $45,883 in 2014 and 2013, respectively)	49,845		47,259
Mortgage loans on real estate	659		671
Policy loans	50,288		48,868
Real estate held for investment (less $1,465 and $1,429 accumulated depreciation in 2014 and 2013, respectively)	8,403		8,440
Other long-term investments	44		45
Total investments	977,584		938,235
Cash and cash equivalents	52,307		54,593
Accrued investment income	12,803		12,251
Receivable for securities	1,707		—
Reinsurance recoverable	4,614		4,394
Deferred policy acquisition costs	148,443		146,691
Cost of customer relationships acquired	25,488		23,374
Goodwill	17,160		17,160
Other intangible assets	976		851
Property and equipment, net	6,688		6,662
Due premiums, net (less $1,312 and $1,429 allowance for doubtful accounts in 2014 and 2013, respectively)	10,387		11,209
Prepaid expenses	1,311		95
Other assets	741		765
Total assets	$	1,260,209	1,216,280

(Continued)

See accompanying notes to consolidated financial statements.

2

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Consolidated Statements of Financial Position (In thousands, except share amounts)
	March 31, 2014			December 31, 2013
Liabilities and Stockholders' Equity	(Unaudited)
Liabilities:
Policy liabilities:
Future policy benefit reserves:
Life insurance	$	856,915		834,269
Annuities	55,833			55,485
Accident and health	1,221			1,250
Dividend accumulations	14,129			13,662
Premiums paid in advance	34,037			32,560
Policy claims payable	10,120			9,488
Other policyholders' funds	7,498			7,982
Total policy liabilities	979,753			954,696
Commissions payable	2,238			2,562
Federal income tax payable	2,107			590
Deferred federal income tax	6,621			1,704
Payable for securities in process of settlement	2,977			—
Other liabilities	10,333			10,919
Total liabilities	1,004,029			970,471
Commitments and contingencies (Note 7)
Stockholders' equity:
Class A, no par value, 100,000,000 shares authorized, 52,215,852 shares issued and outstanding in 2014 and 2013, including shares in treasury of 3,135,738 in 2014 and 2013	259,383			259,383
Class B, no par value, 2,000,000 shares authorized, 1,001,714 shares issued and outstanding in 2014 and 2013	3,184			3,184
Accumulated deficit	(11,345		)	(12,542	)
Accumulated other comprehensive income:
Unrealized gains on securities, net of tax	15,969			6,795
Treasury stock, at cost	(11,011		)	(11,011	)
Total stockholders' equity	256,180			245,809
Total liabilities and stockholders' equity	$	1,260,209		1,216,280

See accompanying notes to consolidated financial statements.

3

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIE Consolidated Statements of Comprehensive Income Three Months Ended March 31, (In thousands, except per share amounts) (Unaudited)
	2014					2013
Revenues:
Premiums:
Life insurance			$	41,397			39,414
Accident and health insurance			351				349
Property insurance			1,265				1,177
Net investment income			9,906				8,389
Realized investment gains (losses), net			(56		)		31
Other income			169				186
Total revenues			53,032				49,546
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders			16,457				14,806
Increase in future policy benefit reserves			17,698				16,959
Policyholders' dividends			2,102				2,074
Total insurance benefits paid or provided			36,257				33,839
Commissions			9,910				9,058
Other general expenses			6,502				6,699
Capitalization of deferred policy acquisition costs			(7,068		)		(6,362	)
Amortization of deferred policy acquisition costs			5,209				4,626
Amortization of cost of customer relationships acquired			531				578
Total benefits and expenses			51,341				48,438
Income before federal income tax			1,691				1,108
Federal income tax expense			494				252
Net income			1,197				856
Per Share Amounts:
Basic earnings per share of Class A common stock	$	0.02				0.02
Basic earnings per share of Class B common stock	0.01					0.01
Diluted earnings per share of Class A common stock	0.02					0.02
Diluted earnings per share of Class B common stock	0.01					0.01
Other comprehensive income:
Unrealized gains on available-for-sale securities:
Unrealized holding gains arising during period			14,096				96
Reclassification adjustment for gains (losses) included in net income			32				(31	)
Unrealized gains on available-for-sale securities, net			14,128				65
Income tax expense on unrealized gains on available-for-sale securities			4,954				27
Other comprehensive income			9,174				38
Comprehensive income			$	10,371			894

See accompanying notes to consolidated financial statements.

4

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Consolidated Statements of Cash Flows Three Months Ended March 31, (In thousands) (Unaudited)
	2014			2013
Cash flows from operating activities:
Net income	$	1,197		856
Adjustments to reconcile net income to net cash provided by operating activities:
Realized gains (losses) on sale of investments and other assets	56			(31	)
Net deferred policy acquisition costs	(1,859		)	(1,736	)
Amortization of cost of customer relationships acquired	531			578
Depreciation	323			320
Amortization of premiums and discounts on investments	2,230			2,297
Deferred federal income tax benefit	(1,023		)	(1,148	)
Change in:
Accrued investment income	(471		)	(608	)
Reinsurance recoverable	(220		)	2,822
Due premiums	822			296
Future policy benefit reserves	17,697			14,504
Other policyholders' liabilities	2,053			1,345
Federal income tax receivable	1,496			1,400
Commissions payable and other liabilities	(1,030		)	(1,408	)
Other, net	(1,293		)	(1,410	)
Net cash provided by operating activities	20,509			18,077
Cash flows from investing activities:
Sale of fixed maturities, available-for-sale	—			58
Maturities and calls of fixed maturities, available-for-sale	16,900			15,851
Maturities and calls of fixed maturities, held-to-maturity	9,292			18,465
Purchase of fixed maturities, available-for-sale	(36,161		)	(64,046	)
Purchase of fixed maturities, held-to-maturity	(6,347		)	—
Calls of equity securities, available-for-sale	100			200
Principal payments on mortgage loans	12			133
Increase in policy loans, net	(1,420		)	(1,879	)
Sale of other long-term investments	1			1
Purchase of other long-term investments	—			(42	)
Purchase of property and equipment	(283		)	(181	)
Purchase of short-term investments	—			(531	)
Net cash used in acquisition	(4,810		)	—
Net cash provided by (used in) investing activities	(22,716		)	(31,971	)

5

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Consolidated Statements of Cash Flows, Continued Three Months Ended March 31, (In thousands) (Unaudited)
	2014			2013
Cash flows from financing activities:
Annuity deposits	1,489			1,242
Annuity withdrawals	(1,568		)	(1,039	)
Net cash provided (used in) by financing activities	(79		)	203
Net decrease in cash and cash equivalents	(2,286		)	(13,691	)
Cash and cash equivalents at beginning of year	54,593			56,299
Cash and cash equivalents at end of period	$	52,307		42,608
Supplemental disclosures of operating activities:
Cash paid (received) during the period for income taxes, net	$	—		—

Supplemental Disclosures of Non-Cash Investing Activities:

None.

See accompanying notes to consolidated financial statements.

6

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

March 31, 2014

(Unaudited)

(1) Financial Statements

Basis of Presentation and Consolidation

The accompanying consolidated financial statements of Citizens, Inc. and its wholly-owned subsidiaries have been prepared in conformity with U.S. generally accepted accounting principles ("U.S. GAAP").

The consolidated financial statements include the accounts and operations of Citizens, Inc. ("Citizens"), a Colorado corporation, and its wholly-owned subsidiaries, CICA Life Insurance Company of America ("CICA"), Security Plan Life Insurance Company ("SPLIC"), Security Plan Fire Insurance Company ("SPFIC"), Citizens National Life Insurance Company ("CNLIC"), Magnolia Guaranty Life Insurance Company ("MGLIC"), Computing Technology, Inc. ("CTI") and Insurance Investors, Inc. ("III").  Citizens and its wholly-owned subsidiaries are collectively referred to as "the Company," "we," "us" or "our."

The consolidated statements of financial position for March 31, 2014, and the consolidated statements of comprehensive income and cash flows for the three-month periods ended March 31, 2014 and 2013, have been prepared by the Company without audit.  In the opinion of management, all adjustments to present fairly the financial position, results of operations, and changes in cash flows at March 31, 2014 and for comparative periods have been made.  The consolidated financial statements have been prepared in accordance with U.S. GAAP accounting principles for interim financial information and with the instructions to Form 10-Q adopted by the Securities and Exchange Commission (“SEC”).  Accordingly, the financial statements do not include all of the information and footnotes required for complete financial statements and should be read in conjunction with the Company’s consolidated financial statements, and notes thereto, for the year ended December 31, 2013.  Operating results for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year or any future period.

We provide primarily life insurance and a small amount of health insurance policies through our insurance subsidiaries:  CICA, SPLIC, MGLIC and CNLIC.  CICA and CNLIC issue ordinary whole-life policies, credit life and disability, burial insurance, pre-need policies, and accident and health related policies, throughout the Midwest and southern United States.  CICA also issues ordinary whole-life policies to non-U.S. residents.  SPLIC offers final expense and home service life insurance in Louisiana, Arkansas and Mississippi and SPFIC, a wholly-owned subsidiary of SPLIC, writes a limited amount of property insurance in Louisiana. MGLIC provides industrial life policies through independent funeral homes in Mississippi.

CTI provides data processing systems and services, as well as furniture and equipment, to the Company.  III provides aviation transportation to the Company.

In accordance with our purchase agreement dated October 7, 2013, we finalized the MGLIC stock acquisition on March 7, 2014 for approximately $5.2 million in cash consideration. The assets recorded as of March 31, 2014 were $11.9 million, liabilities of $6.6 million and stockholders equity of $5.3 million. We believe the goodwill will be minimal relative to this company purchase. We are continuing to finalize the actuarial estimates and intangibles which may result in changes from the amounts reported in this quarterly report on Form 10-Q. This entity will be reported as part of our home service segment business and is a wholly owned subsidiary of SPLIC.

Use of Estimates

The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

The most significant estimates include those used in the evaluation of other-than-temporary impairments on debt and equity securities and valuation allowances on investments, actuarially determined assets and liabilities and assumptions, goodwill impairment, valuation allowance on deferred tax assets, and contingencies relating to litigation and regulatory matters.  Certain

7

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

of these estimates are particularly sensitive to market conditions, and deterioration and/or volatility in the worldwide debt or equity markets could have a material impact on the Consolidated Financial Statements.

Reclassification

Reclassifications have been made in the current year related to certain prior year reported amounts to provide consistent presentation. No individual amounts were material.

Significant Accounting Policies

For a description of significant accounting policies, see Note 1 of the Notes to Consolidated Financial Statements included in our 2013 Form 10-K Annual Report, which should be read in conjunction with these accompanying Consolidated Financial Statements.

(2) Accounting Pronouncements

Accounting Standards Recently Adopted

On January 1, 2014, we adopted Accounting Standards Update (ASU) ASU 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists” to eliminate diversity in practice. This ASU requires that companies net their unrecognized tax benefits against all same-jurisdiction net operating losses or tax credit carryforwards that would be used to settle the position with a tax authority. The adoption of this ASU did not have an effect on our consolidated financial statements.

8

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

(3) Segment Information

The Company has three reportable segments:  Life Insurance, Home Service Insurance, and Other Non-Insurance Enterprises.  The accounting policies of the segments are in accordance with U.S. GAAP and are the same as those used in the preparation of the consolidated financial statements.  The Company evaluates profit and loss performance based on U.S. GAAP income before federal income taxes for its three reportable segments.

The Company has no reportable differences between segments and consolidated operations.

	Three Months Ended
	March 31, 2014
	Life Insurance			Home Service Insurance		Other Non-Insurance Enterprises		Consolidated
	(In thousands)
Revenues:
Premiums	$	31,811		11,202		—		43,013
Net investment income	6,283			3,287		336		9,906
Realized investment gains (losses), net	(64		)	8		—		(56	)
Other income	143			1		25		169
Total revenue	38,173			14,498		361		53,032
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders	10,815			5,642		—		16,457
Increase in future policy benefit reserves	16,976			722		—		17,698
Policyholders' dividends	2,086			16		—		2,102
Total insurance benefits paid or provided	29,877			6,380		—		36,257
Commissions	6,238			3,672		—		9,910
Other general expenses	2,840			3,169		493		6,502
Capitalization of deferred policy acquisition costs	(5,659		)	(1,409	)	—		(7,068	)
Amortization of deferred policy acquisition costs	4,407			802		—		5,209
Amortization of cost of customer relationships acquired	171			360		—		531
Total benefits and expenses	37,874			12,974		493		51,341
Income (loss) before income tax expense	$	299		1,524		(132	)	1,691

9

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

	Three Months Ended
	March 31, 2013
	Life Insurance			Home Service Insurance		Other Non-Insurance Enterprises		Consolidated
	(In thousands)
Revenues:
Premiums	$	30,117		10,823		—		40,940
Net investment income	4,904			3,180		305		8,389
Realized investment gains, net	—			30		1		31
Other income	63			90		33		186
Total revenue	35,084			14,123		339		49,546
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders	9,338			5,468		—		14,806
Increase in future policy benefit reserves	16,042			917		—		16,959
Policyholders' dividends	2,059			15		—		2,074
Total insurance benefits paid or provided	27,439			6,400		—		33,839
Commissions	5,579			3,479		—		9,058
Other general expenses	2,852			3,266		581		6,699
Capitalization of deferred policy acquisition costs	(5,086		)	(1,276	)	—		(6,362	)
Amortization of deferred policy acquisition costs	3,985			641		—		4,626
Amortization of cost of customer relationships acquired	167			411		—		578
Total benefits and expenses	34,936			12,921		581		48,438
Income (loss) before income tax expense	$	148		1,202		(242	)	1,108

10

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

(4) Earnings Per Share

The following tables set forth the computation of basic and diluted earnings per share.

	Three Months Ended
	March 31, 2014		March 31, 2013
	(In thousands, except per share amounts)
Basic and diluted earnings per share:
Numerator:
Net income	$	1,197	856
Net income allocated to Class A common stock	$	1,185	848
Net income allocated to Class B common stock	12		8
Net income	$	1,197	856
Denominator:
Weighted average shares of Class A outstanding - basic	49,080		49,080
Weighted average shares of Class A outstanding - diluted	49,080		49,080
Weighted average shares of Class B outstanding - basic and diluted	1,002		1,002
Basic earnings per share of Class A common stock	$	0.02	0.02
Basic earnings per share of Class B common stock	0.01		0.01
Diluted earnings per share of Class A common stock	0.02		0.02
Diluted earnings per share of Class B common stock	0.01		0.01

(5) Investments

The Company invests primarily in fixed maturity securities, which totaled 84.3% of total investments and cash and cash equivalents at March 31, 2014.

	March 31, 2014				December 31, 2013
	Carrying Value		% of Total Carrying Value		Carrying Value		% of Total Carrying Value
	(In thousands)				(In thousands)
Fixed maturity securities	$	868,345	84.3	%	$	832,952	83.9	%
Equity securities	49,845		4.8	%	47,259		4.8	%
Mortgage loans	659		0.1	%	671		0.1	%
Policy loans	50,288		4.9	%	48,868		4.8	%
Real estate and other long-term investments	8,447		0.8	%	8,485		0.9	%
Cash and cash equivalents	52,307		5.1	%	54,593		5.5	%
Total cash, cash equivalents and investments	$	1,029,891	100.0	%	$	992,828	100.0	%

11

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

The following tables represent the cost, gross unrealized gains and losses and fair value for fixed maturities and equity securities as of the periods indicated.

	March 31, 2014
	Cost or Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
	(In thousands)
Fixed maturities:
Available-for-sale:
U.S. Treasury securities	$	10,101	2,539	—	12,640
U.S. Government-sponsored enterprises	43,076		1,718	30	44,764
States and political subdivisions	355,633		10,529	6,242	359,920
Foreign governments	104		27	—	131
Corporate	208,740		14,883	440	223,183
Commercial mortgage-backed	432		10	—	442
Residential mortgage-backed	3,394		287	2	3,679
Total available-for-sale securities	621,480		29,993	6,714	644,759
Held-to-maturity securities:
U.S. Government-sponsored enterprises	5,846		249	—	6,095
States and political subdivisions	183,868		3,975	3,400	184,443
Corporate	33,872		853	176	34,549
Total held-to-maturity securities	223,586		5,077	3,576	225,087
Total fixed maturities	$	845,066	35,070	10,290	869,846
Equity securities:
Stock mutual funds	$	10,463	1,737	—	12,200
Bond mutual funds	35,080		29	318	34,791
Common stock	810		10	7	813
Preferred stock	1,780		269	8	2,041
Total equity securities	$	48,133	2,045	333	49,845

12

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

	December 31, 2013
	Cost or Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
	(In thousands)
Fixed maturities:
Available-for-sale securities:
U.S. Treasury securities	$	10,115	2,348	—	12,463
U.S. Government-sponsored enterprises	53,587		1,209	228	54,568
States and political subdivisions	341,673		6,242	11,449	336,466
Foreign governments	104		23	—	127
Corporate	186,671		12,289	1,399	197,561
Commercial mortgage-backed	300		9	—	309
Residential mortgage-backed	3,494		270	2	3,762
Total available-for-sale securities	595,944		22,390	13,078	605,256
Held-to-maturity securities:
U.S. Government-sponsored enterprises	8,877		197	3	9,071
States and political subdivisions	181,246		1,633	6,412	176,467
Corporate	37,573		771	349	37,995
Total held-to-maturity securities	227,696		2,601	6,764	223,533
Total fixed maturity securities	$	823,640	24,991	19,842	828,789
Equity securities:
Stock mutual funds	$	10,463	1,506	—	11,969
Bond mutual funds	35,080		—	417	34,663
Common stock	17		—	5	12
Preferred stock	323		292	—	615
Total equity securities	$	45,883	1,798	422	47,259

At March 31, 2014, the Company had $3.8 million of mortgage-backed security holdings based on amortized cost, of which $3.4 million, or 89.5%, were residential U.S. Government-sponsored issues.  Mortgage-backed securities are also referred to as securities not due at a single maturity date throughout this report.  The majority of the Company's equity securities are diversified stock and bond mutual funds.

Valuation of Investments in Fixed Maturity and Equity Securities

Held-to-maturity securities are reported in the financial statements at amortized cost and available-for-sale securities are reported at fair value.

The Company monitors all debt and equity securities on an on-going basis relative to changes in credit ratings, market prices, earnings trends and financial performance, in addition to specific region or industry reviews.  The assessment of whether impairments have occurred is based on a case-by-case evaluation of underlying reasons for the decline in fair value.  The Company determines other-than-temporary impairment by reviewing relevant evidence related to the specific security issuer as well as the Company's intent to sell the security, or if it is more likely than not that the Company would be required to sell a security before recovery of its amortized cost.

When an other-than-temporary impairment has occurred, the amount of the other-than-temporary impairment recognized in earnings depends on whether the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis.  If the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis, the other-than-temporary impairment is recognized in earnings equal to the

13

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

entire difference between the investment's cost and its fair value at the balance sheet date.  If the Company does not intend to sell the security and it is more likely than not that the Company will not be required to sell the security before recovery of its amortized cost basis, the other-than-temporary impairment is separated into the following: (a) the amount representing the credit loss; and (b) the amount related to all other factors.  The amount of the total other-than-temporary impairment related to the credit loss is recognized in earnings.  The amount of the total other-than-temporary impairment related to other factors is recognized in other comprehensive income, net of applicable taxes.  The previous amortized cost basis less the other-than-temporary impairment recognized in earnings becomes the new amortized cost basis of the investment.  The new amortized cost basis is not adjusted for subsequent recoveries in fair value.

The Company evaluates whether a credit impairment exists for debt securities by considering primarily the following factors: (a) changes in the financial condition of the security's underlying collateral; (b) whether the issuer is current on contractually obligated interest and principal payments; (c) changes in the financial condition, credit rating and near-term prospects of the issuer; (d) the length of time to which the fair value has been less than the amortized cost of the security; and (e) the payment structure of the security.  The Company's best estimate of expected future cash flows used to determine the credit loss amount is a quantitative and qualitative process.  Quantitative review includes information received from third party sources such as financial statements, pricing and rating changes, liquidity and other statistical information.  Qualitative factors include judgments related to business strategies, economic impacts on the issuer and overall judgment related to estimates and industry factors.  The Company's best estimate of future cash flows involves assumptions including, but not limited to, various performance indicators, such as historical and projected default and recovery rates, credit ratings, and current delinquency rates.  These assumptions require the use of significant management judgment and include the probability of issuer default and estimates regarding timing and amount of expected recoveries, which may include estimating the underlying collateral value.  In addition, projections of expected future debt security cash flows may change based upon new information regarding the performance of the issuer.

The primary factors considered in evaluating whether an impairment exists for an equity security include, but are not limited to: (a) the length of time and the extent to which the fair value has been less than the cost of the security; (b) changes in the financial condition, credit rating and near-term prospects of the issuer; (c) whether the issuer is current on contractually obligated payments; and (d) the intent and ability of the Company to retain the investment for a period of time sufficient to allow for recovery.

The Company did not recognize any other-than-temporary impairments ("OTTI") during the three months ended March 31, 2014 and 2013.

14

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

The following tables present the fair values and gross unrealized losses of fixed maturities and equity securities that have remained in a continuous unrealized loss position for the periods indicated.

	March 31, 2014
	Less than 12 months				Greater than 12 months			Total
	Fair Value		Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities
	(In thousands, except for # of securities)
Fixed maturities:
Available-for-sale securities:
U.S. Government-sponsored enterprises	$	1,285	9	6	830	21	1	2,115	30	7
States and political subdivisions	128,340		5,149	137	21,095	1,093	23	149,435	6,242	160
Corporate	38,641		286	34	2,623	154	2	41,264	440	36
Residential mortgage-backed	61		1	5	40	1	1	101	2	6
Total available-for-sale securities	168,327		5,445	182	24,588	1,269	27	192,915	6,714	209
Held-to-maturity securities:
States and political subdivisions	74,114		3,031	87	11,710	369	18	85,824	3,400	105
Corporate	5,395		176	4	—	—	—	5,395	176	4
Total held-to-maturity securities	79,509		3,207	91	11,710	369	18	91,219	3,576	109
Total fixed maturities	$	247,836	8,652	273	36,298	1,638	45	284,134	10,290	318
Equity securities:
Bond mutual funds	$	27,682	318	3	—	—	—	27,682	318	3
Common stocks	136		3	1	13	4	1	149	7	2
Preferred stocks	338		8	8	—	—	—	338	8	8
Total equities	$	28,156	329	12	13	4	1	28,169	333	13

As of March 31, 2014, the Company had 27 available-for-sale securities and 18 held-to-maturity securities that were in an unrealized loss position for greater than 12 months. We reported 1 common stock holding in an unrealized loss position as of March 31, 2014.

15

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

	December 31, 2013
	Less than 12 months				Greater than 12 months			Total
	Fair Value		Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities
	(In thousands, except for # of securities)
Fixed maturities:
Available-for-sale securities:
U.S. Government-sponsored enterprises	$	14,032	228	12	—	—	—	14,032	228	12
States and political subdivisions	183,280		9,872	203	15,673	1,577	16	198,953	11,449	219
Corporate	35,789		1,048	25	2,426	351	2	38,215	1,399	27
Residential mortgage-backed	57		1	3	42	1	1	99	2	4
Total available-for-sale securities	233,158		11,149	243	18,141	1,929	19	251,299	13,078	262
Held-to-maturity securities:
U.S. Government-sponsored enterprises	2,997		3	1	—	—	—	2,997	3	1
States and political subdivisions	100,153		5,236	118	14,797	1,176	17	114,950	6,412	135
Corporate	5,225		349	4	—	—	—	5,225	349	4
Total held-to-maturity securities	108,375		5,588	123	14,797	1,176	17	123,172	6,764	140
Total fixed maturities	$	341,533	16,737	366	32,938	3,105	36	374,471	19,842	402
Equity securities:
Bond mutual funds	$	34,663	417	7	—	—	—	34,663	417	7
Common stock	12		5	1	—	—	—	12	5	1
Total equities	$	34,675	422	8	—	—	—	34,675	422	8

We have reviewed these securities for the periods ended March 31, 2014 and December 31, 2013 and determined that no other-than-temporary impairment exists based on our evaluation of the credit worthiness of the issuers and the fact that we do not intend to sell the investments nor is it likely that we will be required to sell the securities before recovery of their amortized cost bases which may be maturity.  We continue to monitor all securities on an on-going basis, and future information may become available which could result in impairments being recorded.

16

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

The amortized cost and fair value of fixed maturity securities at March 31, 2014 by contractual maturity are shown in the table below.  Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date have been reflected based upon final stated maturity.

	March 31, 2014
	Amortized Cost		Fair Value
	(In thousands)
Available-for-sale securities:
Due in one year or less	$	15,507	15,818
Due after one year through five years	117,719		125,050
Due after five years through ten years	104,920		108,876
Due after ten years	383,334		395,015
Total available-for-sale securities	621,480		644,759
Held-to-maturity securities:
Due in one year or less	10,453		10,515
Due after one year through five years	31,897		32,581
Due after five years through ten years	43,214		44,633
Due after ten years	138,022		137,358
Total held-to-maturity securities	223,586		225,087
Total fixed maturities	$	845,066	869,846

The Company uses the specific identification method of the individual security to determine the cost basis used in the calculation of realized gains and losses related to security sales.  Proceeds and gross realized gains from sales of securities for the three months ended March 31, 2014 and 2013 are summarized as follows.

		Fixed Maturities, Available-for-sale			Equity Securities
		Three Months Ended			Three Months Ended
		March 31,			March 31,
		2014		2013	2014	2013
	(In thousands)
Proceeds		$	—	58	—	—
Gross realized gains		$	—	1	—	—
Gross realized losses		$	—	—	—	—

There were no securities sold at a loss during the three month period ended March 31, 2014 or 2013. There were no securities sold from the held-to-maturity portfolio for the three months ended March 31, 2014 or 2013.

(6) Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  We hold available-for-sale fixed maturity securities and equity securities, which are carried at fair value.

Fair value measurements are generally based upon observable and unobservable inputs.  Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our view of market assumptions in the absence of observable market information.  We utilize valuation techniques that maximize the use of observable inputs and minimize the use of

17

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

unobservable inputs.  All assets and liabilities carried at fair value are required to be classified and disclosed in one of the following three categories:

• Level 1 - Quoted prices for identical instruments in active markets.

• Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs or whose significant value drivers are observable.

• Level 3 - Instruments whose significant value drivers are unobservable.

Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as U.S. Treasury securities and actively traded mutual fund and stock investments.

Level 2 includes those financial instruments that are valued by independent pricing services or broker quotes.  These models are primarily industry-standard models that consider various inputs, such as interest rates, credit spreads and foreign exchange rates for the underlying financial instruments.  All significant inputs are observable, or derived from observable information in the marketplace or are supported by observable levels at which transactions are executed in the marketplace.  Financial instruments in this category primarily include corporate securities, U.S. Government-sponsored enterprise securities, municipal securities and certain mortgage and asset-backed securities.

Level 3 is comprised of financial instruments whose fair value is estimated based on non-binding broker prices utilizing significant inputs not based on or corroborated by readily available market information.  This category consists of two private placement mortgage-backed securities.

The following tables set forth our assets and liabilities that are measured at fair value on a recurring basis as of the dates indicated.

	March 31, 2014
Available-for-sale investments	Level 1		Level 2	Level 3	Total Fair Value
	(In thousands)
Financial assets:
Fixed maturities:
U.S. Treasury and U.S. Government-sponsored enterprises	$	12,640	44,764	—	57,404
States and political subdivisions	—		359,920	—	359,920
Corporate	—		223,183	—	223,183
Commercial mortgage-backed	—		152	290	442
Residential mortgage-backed	—		3,679	—	3,679
Foreign governments	—		131	—	131
Total fixed maturities	12,640		631,829	290	644,759
Equity securities:
Stock mutual funds	12,200		—	—	12,200
Bond mutual funds	34,791		—	—	34,791
Common stock	813		—	—	813
Preferred stock	2,041		—	—	2,041
Total equity securities	49,845		—	—	49,845
Total financial assets	$	62,485	631,829	290	694,604

18

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

	December 31, 2013
Available-for-sale investments	Level 1		Level 2	Level 3	Total Fair Value
	(In thousands)
Financial assets:
Fixed maturities:
U.S. Treasury and U.S. Government-sponsored enterprises	$	12,463	54,568	—	67,031
States and political subdivisions	—		336,466	—	336,466
Corporate	—		197,561	—	197,561
Commercial mortgage-backed	—		—	309	309
Residential mortgage-backed	—		3,762	—	3,762
Foreign governments	—		127	—	127
Total fixed maturities	12,463		592,484	309	605,256
Equity securities:
Stock mutual funds	11,969		—	—	11,969
Bond mutual funds	34,663		—	—	34,663
Common stock	12		—	—	12
Preferred stock	615		—	—	615
Total equity securities	47,259		—	—	47,259
Total financial assets	$	59,722	592,484	309	652,515

Financial Instruments Valuation

Fixed maturity securities, available-for-sale.  At March 31, 2014, our fixed maturity securities, valued using a third-party pricing source, totaled $631.8 million for Level 2 assets and comprised 91.0% of total reported fair value of our financial assets.  The Level 1 and Level 2 valuations are reviewed and updated quarterly through random testing by comparisons to separate pricing models, other third-party pricing services, and back tested to recent trades.  In addition, we obtain information relative to the third-party pricing models and review model parameters for reasonableness.  Fair values for Level 3 assets are based upon unadjusted broker quotes that are non-binding, and consist of two private placement mortgage-backed securities with a total value of $0.3 million.  Our Level 3 assets are current relative to principal and interest payments and are considered immaterial to our financial statements.  For the three months ended March 31, 2014, there were no material changes to the valuation methods or assumptions used to determine fair values, and no broker or third party prices were changed from the values received.

Equity securities, available-for-sale.  Our available-for-sale equity securities are classified as Level 1 assets as their fair values are based upon quoted market prices.

19

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

The following table presents additional information about fixed maturity securities measured at fair value on a recurring basis that are classified as Level 3 assets and for which we have utilized significant unobservable inputs to determine fair value.

	March 31, 2014			December 31, 2013
	(In thousands)
Balance at beginning of period	$	309		387
Total realized and unrealized gains (losses)
Included in net income	—			—
Included in other comprehensive income	—			(7	)
Principal paydowns	(19		)	(71	)
Transfer in and (out) of Level 3	—			—
Balance at end of period	$	290		309

We review the fair value hierarchy classifications each reporting period.  Changes in the observability of the valuation attributes may result in a reclassification of certain financial assets.  Such reclassifications are reported as transfers in and out of Level 3 at the beginning fair value for the reporting period in which the changes occur. There were no transfers in or out of Level 1 or 2.

Financial Instruments not Carried at Fair Value

Estimates of fair values are made at a specific point in time, based on relevant market prices and information about the financial instruments.  The estimated fair values of financial instruments presented below are not necessarily indicative of the amounts the Company might realize in actual market transactions.

The carrying amount and fair value for the financial assets and liabilities on the consolidated balance sheets not otherwise disclosed for the periods indicated are as follows:

	March 31, 2014			December 31, 2013
	Carrying Value		Fair Value	Carrying Value	Fair Value
	(In thousands)
Financial assets:
Fixed maturities, held-to-maturity	$	223,586	225,087	227,696	223,533
Mortgage loans	659		684	671	695
Policy loans	50,288		50,288	48,868	48,868
Cash and cash equivalents	52,307		52,307	54,593	54,593
Financial liabilities:
Annuity - investment contracts	39,650		43,086	39,469	44,960

Fair values for fixed income securities, which are characterized as Level 2 assets in the fair value hierarchy, are based on quoted market prices for the same or similar securities.  In cases where quoted market prices are not available, fair values are based on estimates using present value or other assumptions, including a discount rate and estimates of future cash flows.

Mortgage loans are secured principally by residential and commercial properties.  Weighted average interest rates for these loans were approximately 6.4% as of March 31, 2014 and December 31, 2013, with maturities ranging from 1 to 30 years.  Management estimated the fair value using an annual interest rate of 6.25% at March 31, 2014.  Our mortgage loans are considered Level 3 assets in the fair value hierarchy.

20

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

Policy loans had a weighted average annual interest rate of 7.7% as of March 31, 2014 and December 31, 2013, and no specified maturity dates.  The aggregate fair value of policy loans approximates the carrying value reflected on the consolidated balance sheets.  These loans typically carry an interest rate that is tied to the crediting rate applied to the related policy and contract reserves.  Policy loans are an integral part of the life insurance policies we have in force, cannot be valued separately and are not marketable.  Therefore, the fair value of policy loans approximates the carrying value and policy loans are considered Level 3 assets in the fair value hierarchy.

The fair value of short-term investments approximate carrying value due to their short-term nature.  Our short-term investments are considered Level 2 assets in the fair value hierarchy.

The fair value of cash and cash equivalents approximate carrying value and are characterized as Level 1 assets in the fair value hierarchy.

The fair value of the Company's liabilities under annuity contract policies, which are considered Level 3 assets, was estimated at March 31, 2014 using discounted cash flows based upon a swap rate curve with interest rates ranging from 0.24% to 4.03% based upon swap rates adjusted for various risk adjustments. The fair value of liabilities under all insurance contracts are taken into consideration in the overall management of interest rate risk, which seeks to minimize exposure to changing interest rates through the matching of investment maturities with amounts due under insurance contracts.

(7) Commitments and Contingencies

We are a defendant in a lawsuit filed on August 6, 1999, in the Texas District Court, Austin, Texas, now styled Delia Bolanos Andrade, et al., Plaintiffs, v. Citizens Insurance Company of America, et al., Defendants in which a class was originally certified by the trial court and reversed by the Texas Supreme Court in 2007 with an order to the trial court to conduct further proceedings consistent with its ruling.  The underlying lawsuit alleged that certain life insurance policies CICA made available to non-U.S. residents, when combined with a policy feature that allowed certain cash benefits to be assigned to two non-U.S. trusts for the purpose of accumulating ownership of our Class A common stock, along with allowing the policyholders to make additional contributions to the trusts, were actually offers and sales of securities that occurred in Texas by unregistered dealers in violation of the Texas securities laws.  The remedy sought was rescission and return of the insurance premium payments.  On December 9, 2009, the trial court denied the recertification of the class after conducting additional proceedings in accordance with the Texas Supreme Court's ruling.  The remaining plaintiffs must now proceed individually, and not as a class, if they intend to pursue their claims against us.  Since the December 9, 2009 trial court ruling, no individual cases have been further pursued by the plaintiffs.  The probability of the plaintiffs further pursuing their cases individually remains unknown.  An estimate of any possible loss or range of losses cannot be made at this time in regard to individuals pursuing claims.  However, should the plaintiffs further pursue their claims individually, we intend to vigorously defend any proceedings.

The Company is currently performing an internal audit related to unclaimed property for all legal reporting entities. Based upon internal findings to date our exposure appears to be primarily in the state of Louisiana, related to conversion processes surrounding the SPLIC acquisition. The Company had been informed by the Louisiana Department of Treasury, Arkansas Auditor of State and the Texas State Comptroller, that they authorized an audit of Citizens, Inc. and its affiliates for compliance with unclaimed property laws. This audit is being conducted by Verus Financial LLC on behalf of the states.

These internal and external audits may result in additional payments to beneficiaries, additional escheatment of funds deemed abandoned under state laws, administrative penalties, interest, and changes to the Company's procedures for the identification and escheatment of abandoned property.  At this time, the Company is not able to estimate any of these possible amounts, but such costs could be substantial for a company our size.

We defend all claims vigorously.  However, in doing so, we could incur significant defense costs, including attorneys' fees, other direct litigation costs and the expenditure of substantial amounts of management time that otherwise would be devoted to our business.  If we suffer an adverse judgment as a result of litigation claims, it could have a material adverse effect on our business, results of operations and financial condition.

21

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements, Continued

March 31, 2014

(Unaudited)

(8) Income Taxes

The effective tax rate was 29.2% and 22.7% for the first quarter of 2014 and 2013, respectively.   In periods where our effective tax rate is lower than the statutory tax rate of 35%, the difference is primarily due to tax-exempt state and local bonds. The effective tax rate is higher in the current year compared to 2013 primarily due to higher book income in the current period compared to the prior period but approximately the same amount of tax-exempt income in both periods.

(9) Related Party Transactions

The Company has various routine related party transactions in conjunction with our holding company structure, such as a management service agreement related to costs incurred, a tax sharing agreement between entities, and inter-company dividends and capital contributions.  There were no changes related to these relationships during the three months ended March 31, 2014.  See our Annual Report on Form 10-K as of December 31, 2013 for a comprehensive discussion of related party transactions.

22

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report on Form 10-Q are not statements of historical fact and constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act (the "Act"), including, without limitation, statements specifically identified as forward-looking statements within this document.  Many of these statements contain risk factors as well.  In addition, certain statements in future filings by the Company with the Securities and Exchange Commission, in press releases, and in oral and written statements made by us or with the approval of the Company, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Act.  Examples of forward-looking statements include, but are not limited to:  (i) projections of revenues, income or loss, earnings or loss per share, the payment or non-payment of dividends, capital structure, and other financial items, (ii) statements of our plans and objectives by our management or Board of Directors, including those relating to products or services, (iii) statements of future economic performance and (iv) statements of assumptions underlying such statements.  Words such as "believes," "anticipates," "assumes," "estimates," "plans," "projects," "could," "expects," "intends," "targeted," "may," "will" and similar expressions are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements.

Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those contemplated by the forward-looking statements.  Factors that could cause the Company's future results to differ materially from expected results include, but are not limited to:

• Changes in foreign and U.S. general economic, market, and political conditions, including the performance of financial markets and interest rates;

• Changes in consumer behavior, which may affect the Company's ability to sell its products and retain business;

• The timely development of and acceptance of new products of the Company and perceived overall value of these products and services by existing and potential customers;

• Fluctuations in experience regarding current mortality, morbidity, persistency and interest rates relative to expected amounts used in pricing and actuarial valuation of the Company's products;

• The performance of our investment portfolio, which may be adversely affected by changes in interest rates, adverse developments and ratings of issuers whose debt securities we may hold, and other adverse macroeconomic events;

• Results of litigation we may be involved in;

• Changes in assumptions related to deferred acquisition costs and the value of any businesses we may acquire;

• Regulatory, accounting or tax changes that may affect the cost of, or the demand for, the Company's products or services;

• Our concentration of business from persons residing in Latin America and the Pacific Rim;

• Changes in tax laws;

• Effects of acquisitions and restructuring, including possible difficulties in integrating and realizing the projected results of acquisitions;

• Changes in statutory or U.S. GAAP accounting principles, policies or practices; and

• Our success at managing risks involved in the foregoing;

• The risk factors discussed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2013 under the heading "Part II. - Item 1A - Risk Factors."

Such forward-looking statements speak only as of the date on which such statements are made, and the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made.

We make available, free of charge, through our Internet website (http://www.citizensinc.com), our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, Section 16 Reports filed by officers and directors, news

23

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

releases, and, if applicable, amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as soon as reasonably practicable after we electronically file such reports with, or furnish such reports to, the Securities and Exchange Commission.  We are not including any of the information contained on our website as part of, or incorporating it by reference into, this Quarterly Report on Form 10-Q.

Overview

Citizens is an insurance holding company serving the life insurance needs of individuals in the United States since 1969 and internationally since 1975.  Through our insurance subsidiaries, we pursue a strategy of offering traditional insurance products in niche markets where we believe we are able to achieve competitive advantages.  As of March 31, 2014, we had approximately $1.3 billion of total assets and approximately $5.0 billion of insurance in force.  Our core insurance operations include issuing and servicing:

• U.S. Dollar-denominated ordinary whole life insurance and endowment policies predominantly to high net worth, high income foreign residents, principally in Latin America and the Pacific Rim through independent marketing consultants;

• ordinary whole life insurance policies to middle income households concentrated in the Midwest and southern United States through independent marketing consultants; and

• final expense and limited liability property policies to middle and lower income households in Louisiana, Arkansas and Mississippi through employee and independent agents in our home service distribution channel.

We were formed in 1969 by our Chairman, Harold E. Riley.  Prior to our formation, Mr. Riley had many years of experience in the international and domestic life insurance business.  Our Company has experienced significant growth through acquisitions in the domestic market and through market expansion in the international market.  We seek to capitalize on the experience of our management team in marketing and operations as we strive to generate bottom line return using knowledge of our niche markets and our well-established distribution channels.  We believe our underwriting processes, policy terms, pricing practices and proprietary administrative systems enable us to be competitive in our current markets, while protecting our shareholders and servicing our policyholders.

Current Financial Highlights

Financial highlights for the three month period ended March 31, 2014, compared to the same period in 2013 were:

• Insurance premiums rose for the three month period ended March 31, 2014 to $43.0 million in 2014 from $40.9 million for the corresponding period in 2013, an increase of 5.1% driven primarily from first year and renewal premiums in our life insurance segment.

• Net investment income increased 18.1% for the three month period ended March 31, 2014 compared to the corresponding period in 2013.  The average yield on the consolidated portfolio increased to an annualized rate of 4.22% up from 3.86% for the same period in 2013.  

• Claims and surrenders expense increased 11.2% for the three months ended 2014 compared to 2013 as surrenders reported in the life segment were higher in the current year compared to 2013 levels.

• Changes in reserves resulted in liability increases due to the increased sales of endowment products that build up reserves at a faster pace than whole life longer-term mortality based products.

• We completed the acquisition of MGLIC in the current quarter and the related results have been included in our financial results for March 31, 2014. MGLIC is now a wholly owned subsidiary of SPLIC and is reported with the home service segment.

24

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

Our Operating Segments

Our business is comprised of three operating business segments, as detailed below.

• Life Insurance

• Home Service Insurance

• Other Non-Insurance Enterprises

Our insurance operations are the primary focus of the Company, as those operations generate the majority of our income.  See the discussion under Segment Operations for detailed analysis.  The amount of insurance, number of policies, and average face amounts of ordinary life policies issued during the periods indicated are shown below.

	Three Months Ended March 31,
	2014					2013
	Amount of Insurance Issued		Number of Policies Issued	Average Policy Face Amount Issued		Amount of Insurance Issued		Number of Policies Issued	Average Policy Face Amount Issued
Life	$	80,526,319	1,238	$	65,045	$	74,826,174	1,283	$	58,321
Home Service	52,167,918		7,705	6,771		51,827,325		7,234	7,040

25

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

Note:  All discussions below compare or state results for the three -month period ended March 31, 2014 compared to the three -month period ended March 31, 2013.

Consolidated Results of Operations

A discussion of consolidated results is presented below, followed by a discussion of segment operations and financial results by segment.

Revenues

Revenues are generated primarily by insurance premiums and investment income on invested assets.

		Three Months Ended
		March 31,
		2014		2013
	(In thousands)
Revenues:
Premiums:
Life insurance	$	41,397		39,414
Accident and health insurance		351		349
Property insurance		1,265		1,177
Net investment income		9,906		8,389
Realized investment gains (losses), net		(56	)	31
Other income		169		186
Total revenues	$	53,032		49,546

Premium Income.  Premium income derived from life, accident and health, and property insurance sales increased 5.1% for the three months March 31, 2014 compared to the same period ending March 31, 2013. The increase is generated primarily from an increase in the life segment first year and renewal business and premium income of $0.2 million recorded due to the acquisition of MGLIC.

Net investment income performance is summarized as follows.

	March 31,			December 31,		March 31,
	2014			2013		2013
	(In thousands, except for %)
Net investment income, annualized	$	39,625		36,597		33,555
Average invested assets, at amortized cost	940,069			891,215		868,375
Annualized yield on average invested assets	4.22		%	4.11	%	3.86	%

Yields have been slowly rising as we reinvest calls and new premium money into higher yielding bonds compared to the historically low rates experienced over the past several years.   

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March 31, 2014

Investment income from debt securities accounted for approximately 85.6% of total investment income for the three months ended March 31, 2014.  

		Three Months Ended
		March 31,
		2014		2013
	(In thousands)
Gross investment income:
Fixed maturity securities	$	8,911		7,456
Equity securities		394		444
Mortgage loans		11		20
Policy loans		1,002		822
Long-term investments		74		57
Other investment income		15		19
Total investment income		10,407		8,818
Investment expenses		(501	)	(429	)
Net investment income	$	9,906		8,389

The average consolidated invested asset portfolio has increased approximately 5.5% from year end 2013 to March 31, 2014 with primarily investments in the fixed maturity securities portfolio accounting for the most significant increase in the investment income. The purchase of bond mutual funds has resulted in dividend income in the equity securities holdings. In addition, the increase in policy loans, which represents policyholders utilizing their accumulated policy cash value, contributed to the increase to investment income.

Realized Investment Gains (losses), Net.  Gain and losses for both 2014 and 2013 were due to issuer calls. Losses recorded in the current period are related to sinking par calls on bonds purchased at a premium which resulted in a loss.

Benefits and Expenses

		Three Months Ended
		March 31,
		2014		2013
	(In thousands)
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders	$	16,457		14,806
Increase in future policy benefit reserves		17,698		16,959
Policyholders' dividends		2,102		2,074
Total insurance benefits paid or provided		36,257		33,839
Commissions		9,910		9,058
Other general expenses		6,502		6,699
Capitalization of deferred policy acquisition costs		(7,068	)	(6,362	)
Amortization of deferred policy acquisition costs		5,209		4,626
Amortization of cost of customer relationships  acquired		531		578
Total benefits and expenses	$	51,341		48,438

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March 31, 2014

Claims and Surrenders.  A detail of claims and surrender benefits is provided below.

		Three Months Ended
		March 31,
		2014	2013
	(In thousands)
Death claims	$	5,532	5,534
Surrender benefits		5,830	4,556
Endowments		3,805	3,589
Property claims		371	551
Accident and health benefits		138	48
Other policy benefits		781	528
Total claims and surrenders	$	16,457	14,806

• Surrenders increased in the current period by 28.0% primarily due to activity in the life segment as discussed below.

Increase in Future Policy Benefit Reserves.  The increase in future policy benefit reserves for the three months ended March 31, 2014, is due to continued growth in new sales of endowment products, which require higher initial reserve levels than whole life products. Endowments have been our top selling products for the last several years as policyholders favor the guaranteed values of this product.

Policyholder Dividends. The majority of our international policies are participating, and the dividends are factored into the premium rates charged.  As policy provisioned dividend rates generally increase each year that a policy is in force, dividend expense is expected to increase as this block of insurance becomes more seasoned.

Commissions.  Commission expense is directly related to new and renewal insurance premium fluctuations and production levels by agents and associates. Commission expense for the three months ended March 31, 2014 increased primarily due to higher first year and renewal premiums in the life segment compared to premium levels for the three months ended March 31, 2013.  

Capitalized and Amortized Deferred Policy Acquisition Costs.  Costs capitalized under current accounting guidance include certain commissions, policy issuance costs, and underwriting and agency expenses that relate to successful sales efforts for insurance contracts.  The increase for the three months ended March 31, 2014, compared to the same period in 2013 was the result of an increase in first year premium production in the current year, which increased capitalized amounts.  Though premium revenue increased for the three months ended in 2014, it was primarily related to an increase in renewal premiums compared to the prior year.  Commissions paid on renewal premiums are significantly lower than that paid on first year business.

Amortization for the three months ended March 31, 2014, increased compared to the same period in 2013. Amortization of deferred policy acquisition costs is impacted by persistency and may fluctuate from year to year.

Federal Income Tax.  The effective tax rate for the three month period ended March 31, 2014, was 29.2% versus 22.7% in 2013.  Differences between our effective tax rate and the statutory tax rate result from income and expense items that are treated differently for financial reporting and tax purposes.  See Note 8 - Income Taxes in the consolidated financial statements for further discussion.

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March 31, 2014

Segment Operations

The Company has three reportable segments:  Life Insurance, Home Service Insurance and Other Non-Insurance Enterprises.  These segments are reported in accordance with U.S. GAAP.  The Company evaluates profit and loss performance of its segments based on net income or loss before income taxes.

		Three Months Ended
		March 31,
		2014		2013
	(In thousands)
Life Insurance	$	299		148
Home Service Insurance		1,524		1,202
Other Non-Insurance Enterprises		(132	)	(242	)
Total	$	1,691		1,108

Life Insurance

Our Life Insurance segment issues ordinary whole life insurance domestically and U.S. Dollar-denominated ordinary whole-life policies to foreign residents.  These contracts are designed to provide a fixed amount of insurance coverage over the life of the insured.  Additionally, the Company issues endowment contracts, which are principally accumulation contracts that incorporate an element of life insurance protection.  For the majority of our business, we retain only the first $100,000 of risk on any one life.  We operate this segment through CICA and CNLIC insurance subsidiaries.

International Sales

We focus our sales of U.S. Dollar-denominated ordinary whole life insurance and endowment policies to high net worth, high income residents in Latin America and the Pacific Rim.  We have successfully participated in the foreign marketplace since 1975, and we continue to seek opportunities for expansion of our foreign operations.  We believe positive attributes of our international insurance business include:

• larger face amount policies typically issued when compared to our U.S. operations, which results in lower underwriting and administrative costs per unit of coverage;

• premiums typically paid annually rather than monthly or quarterly, which reduces our administrative expenses, accelerates cash flow and results in lower policy lapse rates than premiums with more frequently scheduled payments; and

• comparable persistency levels and mortality rates as experienced with U.S. policies.

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March 31, 2014

International Products

We offer several ordinary whole life insurance and endowment products designed to meet the needs of our non-U.S. policyowners.  These policies have been structured to provide:

• U.S. Dollar-denominated cash values that accumulate, beginning in the first policy year, to a policyholder during his or her lifetime;

• premium rates that are competitive with or better than most foreign local companies;

• a hedge against local currency inflation;

• protection against devaluation of foreign currency;

• capital investment in the United States’ more secure economic environment; and

• lifetime income guarantees for an insured or for surviving beneficiaries.

Our international products have living benefit features.  Every policy contains guaranteed cash values and most are participating (i.e., provides for cash dividends as apportioned by the board of directors).  Once a policyowner pays the annual premium and the policy is issued, we immediately pay the owner a cash dividend as well as an annual guaranteed endowment, if elected.  The policyowner has several options with regard to the dividend and annual guaranteed endowments, including the right to assign policy values to our stock investment plan, registered under the Securities Act of 1933 (the "Securities Act") and administered in the United States by our unaffiliated transfer agent.

The following table sets forth, by country, our direct premiums from our international life insurance business for the periods indicated.

		Three Months Ended
		March 31,
		2014	2013
	(In thousands)
Country
Venezuela	$	6,677	6,399
Colombia		6,310	5,983
Taiwan		4,145	3,874
Ecuador		3,280	3,382
Argentina		1,777	1,831
Other Non-U.S.		7,931	7,304
Total	$	30,120	28,773

We continue to report increased sales from our top producing countries as noted above. Our international business and premium collections could be impacted by future changes relative to laws, regulations or economic events in the countries from which we accept applications.

Domestic Sales

In the Midwest and the southern United States, we seek to serve middle income households through the sale of cash accumulation ordinary whole life insurance products.  The majority of our inforce business results from blocks of business of insurance companies we have acquired over the past fifteen years.

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March 31, 2014

Domestic Products

Our domestic life insurance products focus primarily on living needs and provide benefits focused toward accumulating money for living benefits while providing a modest death benefit for the policyowner.  The features of our domestic life insurance products include:

• cash accumulation/living benefits;

• tax-deferred annuity interest earnings;

• guaranteed lifetime income or monthly income options for the policyowner or surviving family members;

• accidental death benefit coverage options; and

• an option to waive premium payments in the event of disability.

Our life insurance products are principally designed to address the insured's concern about outliving his or her monthly income, while at the same time providing death benefits.  The primary purpose of our product portfolio is to help the insured create capital for needs such as retirement income, children's higher education funds, business opportunities, emergencies and extraordinary health care needs.

The following table sets forth our direct premiums by state for the periods indicated.

		Three Months Ended
		March 31,
		2014	2013
	(In thousands)
State
Texas	$	559	597
Indiana		371	366
Kentucky		133	132
Florida		128	122
Missouri		124	141
Other States		485	479
Total	$	1,800	1,837

A number of domestic life insurance companies we acquired had blocks of accident and health insurance policies, which we did not consider to be a core part of our business.  We have ceded the majority of our accident and health insurance business to Puritan Life Insurance Company ("Puritan"), an unaffiliated insurance company under a coinsurance agreement.

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CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

The results of operations for the life insurance segment for the periods indicated are as follows.

		Three Months Ended
		March 31,
		2014		2013
	(In thousands)
Revenue:
Premiums	$	31,811		30,117
Net investment income		6,283		4,904
Realized investment losses, net		(64	)	—
Other income		143		63
Total revenue		38,173		35,084
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders		10,815		9,338
Increase in future policy benefit reserves		16,976		16,042
Policyholders' dividends		2,086		2,059
Total insurance benefits paid or provided		29,877		27,439
Commissions		6,238		5,579
Other general expenses		2,840		2,852
Capitalization of deferred policy acquisition costs		(5,659	)	(5,086	)
Amortization of deferred policy acquisition costs		4,407		3,985
Amortization of cost of customer relationships acquired		171		167
Total benefits and expenses		37,874		34,936
Income before income tax expense	$	299		148

Premiums.  Premium revenues increased for the three month period ended March 31, 2014, compared to the same period in 2013 due primarily to international renewal business, which experienced strong persistency as this block of insurance ages. First year premium revenues for the quarter ended March 31, 2014, reflected sales internationally with endowment to age sixty-five and the twenty-year endowment products being the top performers.

Life insurance premium breakout is detailed below.

		Three Months Ended
		March 31,
		2014	2013
	(In thousands)
Premiums:
First year	$	4,559	3,938
Renewal		27,252	26,179
Total premiums	$	31,811	30,117

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CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

Net Investment Income.  Net investment income increased as the impact of the sustained low interest rate environment has leveled and yields are beginning to rise modestly.

	Three Months Ended			Year Ended		Three Months Ended
	March 31,			December 31,		March 31,
	2014			2013		2013
	(In thousands, except for %)
Net investment income, annualized	$	25,131		22,237		19,617
Average invested assets, at amortized cost	$	592,493		549,578		523,647
Annualized yield on average invested assets	4.24		%	4.05	%	3.75	%

Realized Investment Losses, Net.  Losses recorded in the current period related to sinking par calls on bonds purchased at a premium which resulted in a loss.

Claims and Surrenders.  These amounts fluctuate from period to period but were within anticipated ranges based upon management's expectations.

		Three Months Ended
		March 31,
		2014	2013
	(In thousands)
Death claims	$	1,299	1,229
Surrender benefits		4,980	4,050
Endowment benefits		3,802	3,585
Accident and health benefits		50	46
Other policy benefits		684	428
Total claims and surrenders	$	10,815	9,338

• Death claims expense was slightly higher for the three months ended March 31, 2014 based upon reported claims. Mortality experience is closely monitored by the Company as a key performance indicator and these amounts were within expected levels.

• Surrenders increased in the current period by 23.0% due to the fact that 2013 reported amounts were unusually low. The majority of policy surrender benefits paid is attributable to our international business and was related to policies that have been in force nearly twenty years, where surrender charges are no longer applicable.

• Endowment benefit expense primarily results from the election by policyholders of a product feature providing an annual guaranteed benefit.  This is a fixed benefit over the life of the contract, thus this expense will increase with new sales and improved persistency.

• Other policy benefits resulted primarily from interest paid on premium deposits and policy benefit accumulations and increased as these policy liabilities also increased.

Increase in Future Policy Benefit Reserves.   Policy benefit reserves increased for the three months ended March 31, 2014 compared to the same period in 2013, primarily from growth in new sales of endowment products, which require higher initial reserve levels than whole life products. Endowment sales have become more popular with our international clients in the past few years, representing approximately 82% and 81% of total new first year premium in the three months ended March 31,2014 and 2013, respectively.

Commissions.  Commission expense increased for the three months ended March 31, 2014, compared to the same period in 2013.  This expense fluctuates directly with new premium revenues, which were higher for the period in 2014 compared to 2013.  Commission rates paid to associates are higher on first year premium sales, which were up 15.8% for the three months

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CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

ended March 31, 2014, compared to 2013.  Renewal premiums for the three months, for which we pay commissions at lower rates, were up $1.1 million, or 4.1%, from the prior year.

Other General Expenses.  The expenses are allocated by segment, based upon an annual expense study performed by the Company, and were down for the three months ended March 31, 2014, compared to the same period in 2013.

Capitalization of Deferred Policy Acquisition Costs ("DAC").  Capitalized costs increased for the three months ended March 31, 2014, due to higher first year premiums and an increase in renewal commissions paid compared to 2013.  DAC capitalization is directly correlated to fluctuations in first year commissions.

Amortization of Deferred Policy Acquisition Costs.  Amortization for 2014 increased and was impacted by overall lower persistency related to this segment. As previously noted, persistency is monitored closely by the Company and was within expectations.

Home Service Insurance

We operate in the Home Service market through our subsidiaries Security Plan Life Insurance Company ("SPLIC") and Security Plan Fire Insurance Company ("SPFIC"), and focus on the life insurance needs of the middle and lower income markets, primarily in Louisiana, Mississippi and Arkansas.  Our policies are sold and serviced through a home service marketing distribution system of employee-agents who work full time on a route system and through funeral homes that sell policies, collect premiums and service policyholders.

In March of the current year we completed the acquisition of Magnolia Guaranty Life Insurance Company ("MGLIC") which is now a wholly owned subsidiary of SPLIC. MGLIC is licensed in Mississippi and customarily sells policies through independent funeral homes while SPLIC customarily sells through the route system. Together, we anticipate Mississippi clients will experience enhanced support from the affiliated companies.

The following table sets forth our direct premiums by state for the periods indicated.

		Three Months Ended
		March 31,
		2014	2013
	(In thousands)
State
Louisiana	$	10,506	10,374
Arkansas		406	436
Mississippi		341	118
Other States		205	208
Total	$	11,458	11,136

We recorded approximately $0.2 million of additional premium in Mississippi for the three months ended March 31, 2014 due to the purchase of MGLIC.

Home Service Insurance Products

Our home service insurance products consist primarily of small face amount ordinary whole life and pre-need policies, which are designed to fund final expenses for the insured, primarily consisting of funeral and burial costs.  To a much lesser extent, our home service insurance segment sells limited-liability, named-peril property policies covering dwellings and contents.  We provide

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CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

$30,000 maximum coverage on any one dwelling and contents, while content only coverage and dwelling only coverage is limited to $20,000, respectively.

We provide final expense ordinary life insurance and annuity products primarily to middle and lower income individuals in Louisiana, Mississippi and Arkansas.  

The results of operations for the home service insurance segment for the periods indicated are as follows.

		Three Months Ended
		March 31,
		2014		2013
	(In thousands)
Revenue:
Premiums	$	11,202		10,823
Net investment income		3,287		3,180
Realized investment gains, net		8		30
Other income		1		90
Total revenue		14,498		14,123
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders		5,642		5,468
Increase in future policy benefit reserves		722		917
Policyholders' dividends		16		15
Total insurance benefits paid or provided		6,380		6,400
Commissions		3,672		3,479
Other general expenses		3,169		3,266
Capitalization of deferred policy acquisition costs		(1,409	)	(1,276	)
Amortization of deferred policy acquisition costs		802		641
Amortization of cost of customer relationships acquired		360		411
Total benefits and expenses		12,974		12,921
Income before income tax expense	$	1,524		1,202

Premiums.  Premiums increased slightly for the three month period ended March 31, 2014, compared to 2013. In addition we recorded $0.2 million of premiums in the current period as part of the MGLIC acquisition.

Net Investment Income.  Net investment income for our home service insurance segment was as follows.

	Three Months Ended			Year Ended		Three Months Ended
	March 31,			December 31,		March 31,
	2014			2013		2013
	(In thousands, except for %)
Net investment income, annualized	$	13,148		13,075		12,718
Average invested assets, at amortized cost	295,260			290,340		293,712
Annualized yield on average invested assets	4.45		%	4.50	%	4.33	%

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CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

Realized Investment Gains, Net.  Net realized gains for the three months ended March 31, 2014 and 2013, were due to calls of debt securities.

Claims and Surrenders.  Claims and surrenders increased for the three months ended March 31, 2014, compared to the same period in 2013, as reported claims increased compared to the prior year, but were within expected ranges.

		Three Months Ended
		March 31,
		2014	2013
	(In thousands)
Death claims	$	4,233	4,305
Surrender benefits		850	506
Endowment benefits		3	4
Property claims		371	551
Accident and health benefits		88	2
Other policy benefits		97	100
Total claims and surrenders	$	5,642	5,468

• Death claims expense decreased for the three months in 2014, due to lower reported claims compared to the three months ended March 31, 2013. Mortality experience is closely monitored by the Company as a key performance indicator and amounts were within expected levels.

• Surrender benefits increased 68% from the three months ended in 2013 compared to 2014 as policyholders elected to cash in their policy values.

• Property claims decreased 32.7% for the three months ended March 31, 2014 as we had experienced weather related claims in 2013.

Increase in Future Policy Benefit Reserves.  The Company recorded a decrease in future policy benefit reserves for the three months ended March 31, 2014, compared to the corresponding period in 2013 due to higher lapses.

Commissions.  Commission expense increased for the three months ended March 31, 2014, compared to the same period in 2013 as we recorded increased premiums. Commission expense related to MGLIC totaled $53,000 for the three months ended March 31, 2014.

Other General Expenses.  Expenses are allocated by segment based upon an annual expense study performed by the Company and decreased between 2014 and 2013.

Capitalization of Deferred Policy Acquisition Costs ("DAC").  Capitalized costs increased slightly for the three months ended March 31, 2014, as commission expense also increased during the period.  DAC capitalization is directly correlated to fluctuations in new business and commissions.

Amortization of Deferred Policy Acquisition Costs.  Amortization for the three months ended March 31, 2014 increased compared to the corresponding period in 2013 as this segment experienced lower persistency compared to the prior year, which results in higher amortization.

Other Non-Insurance Enterprises

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CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

This segment represents the administrative support entities to the insurance operations whose revenues are primarily intercompany and have been eliminated in consolidation under GAAP. The segment loss reported for the first three months of 2014 and 2013 is typical since the elimination of intercompany revenue is it's primarily source of revenue.

Investments

The administration of our investment portfolios is handled by our management, pursuant to board-approved investment guidelines, with all trading activity approved by a committee of each entity's respective boards of directors.  The guidelines used require that fixed maturities, both government and corporate, are investment grade and comprise a majority of the investment portfolio.  State insurance statutes prescribe the quality and percentage of the various types of investments that may be made by insurance companies and generally permit investment in qualified state, municipal, federal and foreign government obligations, high quality corporate bonds, preferred and common stock, mortgage loans and real estate within certain specified percentages.  The assets are intended to mature in accordance with the average maturity of the insurance products and to provide the cash flow for our insurance company subsidiaries to meet their respective policyholder obligations.

The following table shows the carrying value of our investments by investment category and cash and cash equivalents, and the percentage of each to total invested cash, cash equivalents and investments.

	March 31, 2014			December 31, 2013
	Carrying Value		% of Total Carrying Value	Carrying Value		% of Total Carrying Value
	(In thousands)			(In thousands)
Marketable securities:
U.S. Treasury and U.S. Government-sponsored enterprises	$	63,250	6.1	$	75,908	7.7
States and political subdivisions	543,788		52.8	517,712		52.1
Corporate	257,055		25.0	235,134		23.7
Mortgage-backed (1)	4,121		0.4	4,071		0.4
Foreign governments	131		—	127		—
Total marketable securities	868,345		84.3	832,952		83.9
Cash and cash equivalents	52,307		5.1	54,593		5.5
Other investments:
Policy loans	50,288		4.9	48,868		4.8
Equity securities	49,845		4.8	47,259		4.8
Mortgage loans	659		0.1	671		0.1
Real estate	8,403		0.8	8,440		0.9
Other long-term investments	44		—	45		—
Total cash, cash equivalents and investments	$	1,029,891	100.0	$	992,828	100.0

⁽¹⁾ Includes $3.7 million and $3.8 million of U.S. Government-sponsored enterprises at March 31, 2014, and December 31, 2013, respectively.

Cash and cash equivalents decreased as of March 31, 2014 due to timing of cash inflows and investment into marketable securities.

The held-to-maturity portfolio as of March 31, 2014 represented 25.7% of the total fixed maturity securities owned based upon carrying values, with the remaining 74.3% classified as available-for-sale.  Held-to-maturity securities are reported in the financial statements at amortized cost and available-for-sale securities are reported at fair value.

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CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

The following table sets forth the distribution of the credit ratings of our portfolio of fixed maturity securities by carrying value as of March 31, 2014 and December 31, 2013.

	March 31, 2014			December 31, 2013
	Carrying Value		% of Total Carrying Value	Carrying Value		% of Total Carrying Value
	(In thousands)			(In thousands)
AAA	$	51,270	5.9	$	55,093	6.6
AA	410,202		47.2	391,054		46.9
A	230,274		26.5	231,004		27.7
BBB	145,284		16.7	125,597		15.1
BB and other	31,315		3.7	30,204		3.7
Totals	$	868,345	100.0	$	832,952	100.0

Credit ratings reported for the periods indicated are assigned by a Nationally Recognized Statistical Rating Organization (“NRSRO”) such as Moody’s Investors Service, Standard & Poor’s or Fitch Ratings.  A credit rating assigned by an NRSRO is a quality based rating, with AAA representing the highest quality and D the lowest, with BBB and above being considered investment grade.  In addition, the Company may use credit ratings of the National Association of Insurance Commissioners (“NAIC”) Securities Valuation Office (“SVO”) as assigned, if there is no NRSRO rating.  Securities rated by the SVO are grouped in the equivalent NRSRO category as stated by the SVO and securities that are not rated by an NRSRO are included in the “other” category.

The Company has no direct sovereign European debt exposure as of March 31, 2014.  We do have indirect exposure in one bond mutual fund holding, but the amount is deemed immaterial to the current investment holdings and consolidated financials.

As of March 31, 2014, the Company held municipal securities that include third party guarantees.  Detailed below is a presentation by NRSRO rating of our municipal holdings by funding type.

Municipals shown including third party guarantees

	March 31, 2014
	General Obligation			Special Revenue		Other		Total		% Based on
	Fair Value		Amortized Cost	Fair Value	Amortized Cost	Fair Value	Amortized Cost	Fair Value	Amortized Cost	Amortized Cost
	(In thousands)
AAA	$	33,784	32,535	15,356	14,898	—	—	49,140	47,433	8.8
AA	115,398		114,278	189,042	184,645	15,183	14,840	319,623	313,763	58.1
A	35,804		36,970	101,177	101,596	8,918	9,042	145,899	147,608	27.4
BBB	2,730		2,823	17,474	17,426	—	—	20,204	20,249	3.8
BB and other	542		495	8,426	9,371	529	582	9,497	10,448	1.9
Total	$	188,258	187,101	331,475	327,936	24,630	24,464	544,363	539,501	100.0

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CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

Municipals shown excluding third party guarantees

	March 31, 2014
	General Obligation			Special Revenue		Other		Total		% Based on
	Fair Value		Amortized Cost	Fair Value	Amortized Cost	Fair Value	Amortized Cost	Fair Value	Amortized Cost	Amortized Cost
	(In thousands)
AAA	$	33,550	32,302	15,356	14,898	—	—	48,906	47,200	8.7
AA	98,864		97,927	141,497	138,101	12,448	12,068	252,809	248,096	46.0
A	52,572		53,554	140,544	140,010	11,654	11,814	204,770	205,378	38.1
BBB	2,730		2,823	25,652	25,556	—	—	28,382	28,379	5.3
BB and other	542		495	8,426	9,371	528	582	9,496	10,448	1.9
Total	$	188,258	187,101	331,475	327,936	24,630	24,464	544,363	539,501	100.0

The Company held investments in special revenue bonds that had a greater than 10% exposure based upon activity as noted in the table below.

	Fair Value		Amortized Cost	% of Total Fair Value
	(In thousands)
Utilities	$	114,839	114,309	21.1

39

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

The tables below represent the Company's exposure of municipal holdings in Louisiana and Texas, which exceed 10% of the total municipal portfolio as of March 31, 2014.

	March 31, 2014
	General Obligation			Special Revenue		Other		Total
	Fair Value		Amortized Cost	Fair Value	Amortized Cost	Fair Value	Amortized Cost	Fair Value	Amortized Cost
	(In thousands)
Louisiana securities including third party guarantees
AA	$	6,685	6,379	29,085	28,314	—	—	35,770	34,693
A	6,049		6,198	10,351	10,240	—	—	16,400	16,438
BBB	1,695		1,728	—	—	1,020	1,016	2,715	2,744
BB and other	—		—	4,688	5,074	—	—	4,688	5,074
Total	$	14,429	14,305	44,124	43,628	1,020	1,016	59,573	58,949
Louisiana securities excluding third party guarantees
AA	$	6,685	6,379	18,681	18,153	—	—	25,366	24,532
A	6,049		6,198	15,729	15,390	—	—	21,778	21,588
BBB	1,695		1,728	5,026	5,011	1,020	1,016	7,741	7,755
BB and other	—		—	4,688	5,074	—	—	4,688	5,074
Total	$	14,429	14,305	44,124	43,628	1,020	1,016	59,573	58,949
Texas securities including third party guarantees
AAA	$	32,700	31,481	8,621	8,354	—	—	41,321	39,835
AA	30,294		30,602	19,696	19,395	—	—	49,990	49,997
A	2,022		2,038	14,553	14,208	—	—	16,575	16,246
BBB	—		—	10,144	9,961	—	—	10,144	9,961
BB and other	—		—	—	—	—	—	—	—
Total	$	65,016	64,121	53,014	51,918	—	—	118,030	116,039
Texas securities excluding third party guarantees
AAA	$	32,465	31,248	8,622	8,355	—	—	41,087	39,603
AA	24,839		25,048	15,833	15,526	—	—	40,672	40,574
A	7,712		7,825	18,415	18,076	—	—	26,127	25,901
BBB	—		—	10,144	9,961	—	—	10,144	9,961
BB and other	—		—	—	—	—	—	—	—
Total	$	65,016	64,121	53,014	51,918	—	—	118,030	116,039

The Company invests in municipal securities of issuers in the state of Louisiana and receives a credit that reduces its premium tax liability in that state.  At March 31, 2014, total holdings of municipal securities in Louisiana represented 10.9% of all municipal holdings based upon fair value.  The Company also holds 21.7% of its municipal holdings in Texas issuers.  There were no other states or individual issuer holdings that represented or exceeded 10% of the total municipal portfolio as of March 31, 2014.

40

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

Valuation of Investments

We evaluate the carrying value of our fixed maturity and equity securities at least quarterly.  The Company monitors all debt and equity securities on an on-going basis relative to changes in credit ratings, market prices, earnings trends and financial performance, in addition to specific region or industry reviews.  The assessment of whether impairments have occurred is based on a case-by-case evaluation of underlying reasons for the decline in fair value.  The Company determines other-than-temporary impairment by reviewing all relevant evidence related to the specific security issuer as well as the Company's intent to sell the security, or if it is more likely than not that the Company would be required to sell a security before recovery of its amortized cost.

When an other-than-temporary impairment has occurred, the amount of the other-than-temporary impairment recognized in earnings depends on whether the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis.  If the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis, the other-than-temporary impairment is recognized in earnings equal to the entire difference between the investment's cost and its fair value at the balance sheet date.  If the Company does not intend to sell the security and it is not more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis, the other-than-temporary impairment is separated into the following:  a) the amount representing the credit loss; and b) the amount related to all other factors.  The amount of the total other-than-temporary impairment related to the credit loss is recognized in earnings.  The amount of the total other-than-temporary impairment related to other factors is recognized in other comprehensive income, net of applicable taxes.  The previous amortized cost basis less the other-than-temporary impairment recognized in earnings becomes the new amortized cost basis of the investment.  The new amortized cost basis is not adjusted for subsequent recoveries in fair value.

The Company did not recognize any other-than-temporary impairments for the three months ended March 31, 2014 or 2013.

Liquidity and Capital Resources

Liquidity refers to a company's ability to generate sufficient cash flows to meet the needs of its operations.  Liquidity is managed on insurance operations and seeks to ensure stable and reliable sources of cash flows to meet obligations provided by a variety of sources.

Liquidity requirements of the Company are met primarily by funds provided from operations.  Premium deposits and revenues, investment income and investment maturities are the primary sources of funds, while investment purchases, policy benefits, and operating expenses are the primary uses of funds.  We historically have not had to liquidate investments relative to our insurance operations to provide cash flow and did not do so during the first three months of 2014.  Our investments as of March 31, 2014, consist of 66.0% of marketable debt securities classified as available-for-sale that could be readily converted to cash for liquidity needs.

A primary liquidity concern is the risk of an extraordinary level of early policyholder withdrawals.  We include provisions within our insurance policies, such as surrender charges, that help limit and discourage early withdrawals.  Since these contractual withdrawals, as well as the level of surrenders experienced, were largely consistent with our assumptions in asset liability management, our associated cash outflows have, to date, not had an adverse impact on our overall liquidity.  Individual life insurance policies are less susceptible to withdrawal than annuity reserves and deposit liabilities because policyholders may incur surrender charges and undergo a new underwriting process in order to obtain a new insurance policy.  Cash flow projections and cash flow tests under various market interest rate scenarios are also performed annually to assist in evaluating liquidity needs and adequacy.  We currently anticipate that available liquidity sources and future cash flows will be adequate to meet our needs for funds.

Cash flows from our insurance operations have been sufficient to meet current needs.  Cash flows from operating activities were $20.5 million and $18.1 million for the three months ended March 31, 2014 and 2013, respectively.  We have traditionally also had significant cash flows from both scheduled and unscheduled investment security maturities, redemptions, and prepayments.  These cash flows, for the most part, are reinvested in fixed income securities.  Net cash outflows from investing activities totaled $22.7 million and $32.0 million for the three months ended March 31, 2014 and 2013, respectively. The investing

41

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

activities fluctuate from period to period due to timing of securities activities such as calls and maturities and reinvestment of those funds. 

The NAIC has established minimum capital requirements in the form of Risk-Based Capital ("RBC").  RBC factors the type of business written by an insurance company, the quality of its assets, and various other aspects of an insurance company's business to develop a minimum level of capital called "authorized control level risk-based capital" and compares this level to adjusted statutory capital that includes capital and surplus as reported under statutory accounting principles, plus certain investment reserves.  Should the ratio of adjusted statutory capital to control level RBC fall below 200%, a series of remedial actions by the affected company would be required.

All insurance subsidiaries were above the RBC minimums at December 31, 2013.  The ratios of adjusted statutory capital to control level RBC are shown below.

	December 31,
	2013
CICA	635	%
CNLIC	2,363	%
SPFIC	421	%
SPLIC	1,306	%
MGLIC	1,210	%

Contractual Obligations and Off-balance Sheet Arrangements

There have been no material changes in contractual obligations from those reported in the Company's Form 10-K for the year ended December 31, 2013.  The Company does not have off-balance sheet arrangements at March 31, 2014, and does not expect any future effects on the Company's financial condition related to any such arrangements.  We do not utilize special purpose entities as investment vehicles, nor are there any such entities in which we have an investment that engage in speculative activities of any nature, and we do not use such investments to hedge our investment positions.

Parent Company Liquidity and Capital Resources

Citizens is a holding company and has had minimal operations of its own.  Its assets consist primarily of the capital stock of its subsidiaries, cash, fixed income securities, mutual funds and investment real estate.  Accordingly, Citizens' cash flows depend upon the availability of statutorily permissible payments, primarily payments under management agreements from its two primary life insurance subsidiaries, CICA and SPLIC.  The ability to make payments is limited by applicable laws and regulations of Colorado, CICA's state of domicile, and Louisiana, SPLIC's state of domicile, which subject insurance operations to significant regulatory restriction.  These laws and regulations require, among other things, that these insurance subsidiaries maintain minimum solvency requirements and limit the amount of dividends these subsidiaries can pay to the holding company.  Citizens historically has not relied upon dividends from subsidiaries for its cash flow needs.  However, CICA and SPLIC do dividend available funds from time to time in relation to new acquisition target strategies.

42

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

Critical Accounting Policies

We have prepared a current assessment of our critical accounting policies and estimates in connection with preparing our interim unaudited consolidated financial statements as of and for the three months ended March 31, 2014 and 2013. We believe that the accounting policies set forth in the Notes to our Consolidated Financial Statements and “Critical Accounting Policies and Estimates” in the Management’s Discussion and Analysis of Consolidated Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2013 continue to describe the significant judgments and estimates used in the preparation of our consolidated financial statements.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

General

The nature of our business exposes us to market risk relative to our invested assets and policy liabilities.  Market risk is the risk of loss that may occur when changes in interest rates and public equity prices adversely affect the value of our invested assets.  Interest rate risk is our primary market risk exposure.  Substantial and sustained increases and decreases in market interest rates can affect the fair value of our investments.  The fair value of our fixed maturity portfolio generally increases when interest rates decrease and decreases when interest rates increase. For additional information regarding market risks to which we are subject, see "Item 1 Financial Statements - Note 5. Investments - Valuation of Investments in Fixed Maturity and Equity Securities" above.

The following table summarizes net unrealized gains and losses for the periods indicated.

	March 31, 2014				December 31, 2013
	Amortized Cost		Fair Value	Net Unrealized Gains (Losses)	Amortized Cost	Fair Value	Net Unrealized Gains (Losses)
	(In thousands)
Fixed maturities, available-for-sale	$	621,480	644,759	23,279	595,944	605,256	9,312
Fixed maturities, held-to-maturity	223,586		225,087	1,501	227,696	223,533	(4,163	)
Total fixed maturities	$	845,066	869,846	24,780	823,640	828,789	5,149
Total equity securities	$	48,133	49,845	1,712	45,883	47,259	1,376

Market Risk Related to Interest Rates

Our exposure to interest rate changes results from our significant holdings of fixed maturity investments, which comprised 88.8% of our investment portfolio based on carrying value as of March 31, 2014.  These investments are mainly exposed to changes in U.S. Treasury rates.  Our fixed maturity investments include U.S. Government-sponsored enterprises, U.S. Government bonds, securities issued by government agencies, municipal bonds and corporate bonds.  

To manage interest rate risk, we perform periodic projections of asset and liability cash flows to evaluate the potential sensitivity of our investments and liabilities.  We assess interest rate sensitivity annually with respect to our available-for-sale fixed maturities investments using hypothetical test scenarios that assume either upward or downward shifts in the prevailing interest rates.  The changes in fair values of our debt and equity securities as of March 31, 2014 were within the expected range of this analysis.

Changes in interest rates typically have a sizable effect on the fair values of our debt and equity securities.  The interest rate of the ten-year U.S. Treasury bond decreased to 2.7% during the quarter ended March 31, 2014, from 3.0% at December 31, 2013.  Net

43

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

unrealized gains on fixed maturity securities totaled $24.8 million at March 31, 2014, compared to $5.1 million at December 31, 2013.

The fixed maturity portfolio is exposed to call risk, as a significant portion of the current bond holdings are callable.  A decreasing interest rate environment can result in increased call activity as experienced over the past several years, and an increasing rate environment will likely result in securities being paid at their stated maturity.

There are no fixed maturities or other investments classified as trading instruments.  Approximately 74.1% of fixed maturities were held in available-for-sale and 25.9% in held-to-maturity based upon fair value at March 31, 2014.  At March 31, 2014 and December 31, 2013, we had no investments in derivative instruments, nor did we have any subprime or collateralized debt obligation risk.

Market Risk Related to Equity Prices

Changes in the level or volatility of equity prices affect the value of equity securities we hold as investments.  Our equity investments portfolio represented 5.1% of our total investments at March 31, 2014, with 94.3% invested in diversified equity and bond mutual funds.  We believe that significant decreases in the equity markets would not have a material adverse impact on our total investment portfolio.

Item 4. CONTROLS AND PROCEDURES

We have established disclosure controls and procedures to ensure, among other things, that material information relating to our Company, including its consolidated subsidiaries, is made known to our officers who certify our financial reports and to the other members of our senior management and the Board of Directors.

Our Chief Executive Officer, Vice Chairman and Chief Financial Officer are responsible for establishing and maintaining our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")).  Based upon an evaluation at the end of the period covered by this report, the Chief Executive Officer, Vice Chairman and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.

During the three months ended March 31, 2014, there were no changes in the Company's internal controls over financial reporting that have materially affected or are reasonably likely to materially affect, the Company's internal controls over financial reporting (as defined in rules 13a-15(f) and 15d-15(f) under the Exchange Act).

44

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

PART II.  OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

We are a defendant in a lawsuit filed on August 6, 1999, in the Texas District Court, Austin, Texas, now styled Delia Bolanos Andrade, et al., Plaintiffs, v. Citizens Insurance Company of America, et al., Defendants in which a class was originally certified by the trial court and reversed by the Texas Supreme Court in 2007 with an order to the trial court to conduct further proceedings consistent with its ruling.  The underlying lawsuit alleged that certain life insurance policies CICA made available to non-U.S. residents, when combined with a policy feature that allowed certain cash benefits to be assigned to two non-U.S. trusts for the purpose of accumulating ownership of our Class A common stock, along with allowing the policyholders to make additional contributions to the trusts, were actually offers and sales of securities that occurred in Texas by unregistered dealers in violation of the Texas securities laws.  The remedy sought was rescission and return of the insurance premium payments.  On December 9, 2009, the trial court denied the recertification of the class after conducting additional proceedings in accordance with the Texas Supreme Court's ruling.  The remaining plaintiffs must now proceed individually, and not as a class, if they intend to pursue their claims against us.  Since the December 9, 2009 trial court ruling, no individual cases have been further pursued by the plaintiffs.  The probability of the plaintiffs further pursuing their cases individually remains unknown.  An estimate of any possible loss or range of losses cannot be made at this time in regard to individuals pursuing claims.  However, should the plaintiffs further pursue their claims individually, we intend to vigorously defend any proceedings.

The Company is vigorously defending a number of matters in various stages of development and a number of individual lawsuits, which are immaterial to the Company's financial statements.

Item 1A. RISK FACTORS

There are no updates to our risk factors as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2013.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

Item 3. DEFAULTS UPON SENIOR SECURITIES

None.

Item 4. MINE SAFETY DISCLOSURES

Not applicable.

Item 5. OTHER INFORMATION

On May 6, 2014, the Company issued a news release (the "Release") reporting, among things, results of operations for its first quarter of 2014.  A copy of the Release is furnished as Exhibit 99.1 to this Quarterly Report on Form 10-Q.  Citizens also announced that it would hold a conference call to discuss its financial results at 10:00 a.m. Central Daylight Time on Wednesday, May 7, 2014.

45

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

March 31, 2014

Item 6. EXHIBITS

Exhibit Number	The following exhibits are filed herewith:
11	Statement re:  Computation of per share earnings (see financial statements)
31.1	Certification of Chief Executive Officer and Vice Chairman pursuant to Section 302 of the Sarbanes-Oxley Act*
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act*
32.1	Certification of Chief Executive Officer and Vice Chairman pursuant to Section 906 of the Sarbanes-Oxley Act*
32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act*
99.1	News Release reporting first quarter results issued on May 6, 2014 (furnished herewith)
101.INS	XBRL Instance Document (furnished herewith)
101.SCH	XBRL Taxonomy Extension Schema (furnished herewith)
101.CAL	XBRL Taxonomy Extension Calculation Linkbase (furnished herewith)
101.DEF	XBRL Taxonomy Extension Definition Linkbase (furnished herewith)
101.LAB	XBRL Taxonomy Extension Label Linkbase (furnished herewith)
101.PRE	XBRL Taxonomy Extension Presentation Linkbase (furnished herewith)
	__________________

* Filed herewith.

46

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		CITIZENS, INC.
		By:	/s/ Harold E. Riley
			Harold E. Riley
			Chairman and Chief Executive Officer
		By:	/s/ Rick D. Riley
			Rick D. Riley
			Vice Chairman and President
		By:	/s/ Kay E. Osbourn
			Kay E. Osbourn
			Executive Vice President, Chief Financial Officer and Treasurer
Date:	May 6, 2014

47

EX-31.1

EXHIBIT 31.1

Certification of Chief Executive Officer Under

Section 302 of the Sarbanes-Oxley Act of 2002

We, Harold E. Riley, Chairman and Chief Executive Officer and Rick D. Riley, Vice Chairman and President of Citizens, Inc., certify that:

1. We have reviewed this Quarterly Report on Form 10-Q of Citizens, Inc. ("registrant");

2. Based on our knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on our knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and us are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and us have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design of operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

48

		By:	/s/ Harold E. Riley
			Harold E. Riley
			Chairman and Chief Executive Officer
		By:	/s/ Rick D. Riley
			Rick D. Riley
			Vice Chairman and President
Date:	May 6, 2014

49

EX-31.2

EXHIBIT 31.2

Certification of Chief Executive Officer Under

Section 302 of the Sarbanes-Oxley Act of 2002

I, Kay E. Osbourn, Executive Vice President, Chief Financial Officer and Treasurer of Citizens, Inc., certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Citizens, Inc. ("registrant");

2. Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design of operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

		By:	/s/ Kay E. Osbourn
			Kay E. Osbourn
			Exec. Vice President, Chief Financial Officer and Treasurer
Date:	May 6, 2014

50

EX-32.1

EXHIBIT 32.1

Certification of Chief Executive Officerof Citizens, Inc. Pursuant to 18 U.S.C. §1350

We, Harold E. Riley and Rick D. Riley, certify that:

In connection with the Quarterly Report on Form 10-Q of Citizens, Inc. (the "Company") for the period ended March 31, 2014, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), we, Harold E. Riley, Chairman and Chief Executive Officer and Rick D. Riley, Vice Chairman and President of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:

1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

	/s/ Harold E. Riley
Name:	Harold E. Riley
Title:	Chairman and Chief Executive Officer
By:	/s/ Rick D. Riley
	Rick D. Riley
	Vice Chairman and President
Date:	May 6, 2014

51

EX-32.2

EXHIBIT 32.2

Certification of Chief Financial Officer of Citizens, Inc. Pursuant to 18 U.S.C. §1350

I, Kay E. Osbourn, certify that:

In connection with the Quarterly Report on Form 10-Q of Citizens, Inc. (the "Company") for the period ended March 31, 2014, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Kay E. Osbourn, Executive Vice President, Chief Financial Officer and Treasurer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:

1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

	/s/ Kay E. Osbourn
Name:	Kay E. Osbourn
Title:	Executive Vice President, Chief Financial Officer and Treasurer
Date:	May 6, 2014

52

EX-99.1

EXHIBIT 99.1

FOR FURTHER INFORMATION CONTACT:

Kay Osbourn

Chief Financial Officer

(512) 837-7100

PR@citizensinc.com

FOR IMMEDIATE RELEASE

May 6, 2014

Citizens, Inc. Reports First Quarter 2014 Results

Investor Conference Call Scheduled for May 7, 2014, at 10:00 a.m. CDT

AUSTIN, TEXAS (May 6, 2014) – Citizens, Inc. (NYSE: CIA) reported results today for the first quarter ended March 31, 2014.

Rick D. Riley, Vice Chairman and President, said, "We began 2014 with increased premium revenues and investment income, which is further complemented by favorable claim experience. Our life operations contributed to the premium increase with both new and renewal business reflecting strong first quarter sales."

Riley added, “We reported an investment income increase over 18% for the current quarter compared to the same three months in 2013, as the portfolio yield increased to 4.22% compared to 4.11% for the full year of 2013 and 3.86% for the three months ended March 31, 2013. In addition, interest on policyholder loans contributed positively to this improvement."

“Book value per share of Class A common stock was $5.12 at March 31, 2014."

FOR THE PERIODS ENDED MARCH 31,	2014			2013
(Unaudited, In thousands, except for per share amounts)
Premiums	$	43,013		40,940
Net investment income	9,906			8,389
Net realized investment gains (losses)	(56		)	31
Total revenue	53,032			49,546
Net income applicable to common stock	1,197			856
Net income per diluted share of Class A common stock	0.02			0.02
Diluted weighted average shares of Class A common stock	49,080			49,080
Operating income	$	1,233		836

"We closed the acquisition of Magnolia Guaranty Life Insurance Company ("MGLIC") on March 7, 2014 by paying $5.2 million in cash for 100% of MGLIC's outstanding common stock," Riley stated. "The assets recorded as of March 31, 2014 were $11.9 million, liabilities of $6.6 million and stockholders equity of $5.3 million and we anticipate MGLIC will contribute approximately $0.3 million of additional net income for the full year of 2014. This entity will be reported as part of our home service segment business as a wholly owned subsidiary of our Security Plan Life Insurance Company subsidiary."

53

Reconciliation of Net Income to Operating Income (a non-GAAP measure)
FOR THE PERIODS ENDED MARCH 31,	2014			2013
(Unaudited,In thousands)
Net income	$	1,197		856
Items excluded in the calculation of operating income:
Net realized investment (gains) losses	56			(31	)
Pre-tax effect of exclusions	56			(31	)
Tax effect at 35%	(20		)	11
Operating income	$	1,233		836

Non-GAAP Financial Measures - The table above reconciles Net Income to Operating Income. Operating Income is a "Non-GAAP" financial measure that is widely used in our industry to evaluate the performance of underwriting operations. Operating Income excludes the after-tax net effects of Net Realized Investment Gains and Losses. We believe it presents a useful view of the performance of our insurance operations. While we believe disclosure of certain Non-GAAP information is appropriate, you should not consider this information without also considering the information we present in accordance with GAAP.

INSURANCE OPERATIONS

t Life Insurance –Our Life Insurance segment primarily issues ordinary whole life insurance and endowments in U.S. Dollar-denominated amounts to foreign residents in approximately 30 countries through independent marketing consultants, and domestically through independent marketing firms and consultants across the United States.

o Premiums – Life insurance premium revenues increased for the first quarter of 2014, due to higher international first year and renewal premiums, as we continue to experience strong endowment sales and persistency.  The endowment to age sixty-five and the twenty-year endowment continue to be the preferred products internationally. Endowment sales overall represented approximately 82% of first year premiums in the first three months of 2014. We held our annual sales convention during April and based upon the agent feedback we expect to see strong sales this year through continued enthusiasm in our international markets. Venezuela, Colombia and Taiwan which have been our top three producing countries, all showed premium growth this first quarter compared to the same period in 2013.

o Benefits and expenses – Total life insurance benefits and expenses rose in line with premium growth for the first quarter of 2014 compared to the same period in 2013. Future policy benefit reserves increased as endowment products accumulate higher reserve balances on the front end when compared to whole life products. Commission expense increased as first year sales expanded and renewal premium remained strong. Surrender expense was up for the three months ended in 2014 due to the unusually low comparable prior year expense in 2013. Our surrenders have remained at a level totaling approximately .6% of inforce with a large portion related to policies that have passed the surrender charge period, which is typically fourteen years.

t Home Service – Our Home Service Insurance segment provides pre-need and final expense ordinary life insurance and annuities to middle and lower income individuals, primarily in Louisiana, Mississippi and Arkansas.  Our policies in this segment are sold and serviced through funeral homes and a home service marketing distribution system utilizing employees and independent agents.

o Premiums – Home service premiums increased 3.5% primarily due to the added premium associated with the MGLIC acquisition. We expect this acquisition will benefit our Home Service segment by increasing our presence and agency force in Mississippi.

o Benefits and expenses – Claims and surrenders increased by 3.2% for the first three months of 2014, due to an increase in surrenders in the current period. The comparable period in 2013 was unusually low related to surrenders and there have been no changes relative to our long-term expectations. In 2013, we experienced increased weather-related property claims which results in a 33% decrease when comparing the three months ended March 31, 2013 and 2014. In addition, this segment reported increased amortization of deferred acquisition costs, as we experienced higher policies lapses in the current year.

The non-insurance segment represents the administrative support entities to the insurance operations whose revenues are primarily intercompany and have been eliminated in consolidation under GAAP. 

54

INVESTMENTS

t Invested assets – Total invested assets increased from year-end 2013 as new premium revenues were invested in bonds and policy loans rose.

o Fixed maturity securities represented 84.3% of the invested assets and cash at March 31, 2014, compared with 83.9% at year-end 2013.

o Equity security holdings increased to $49.8 million at March 31, 2014 from $47.3 million at year-end 2013 with the increase coming from the MGLIC acquisition. The majority of our equity holdings are bond mutual funds.

o Cash and cash equivalents represented 5.1% of total cash, cash equivalents and invested assets at March 31, 2014, down from 5.5% at year-end 2013, reflecting the timing of calls of securities owned and of investment and reinvestment of new premium revenues and other available funds.

t Investment income – Net investment income increased 18.1% for the three months ended March 31, 2014 compared to the same period in 2013, primarily due to an increase in overall invested assets from premium collections received and invested in fixed maturity bonds.  The policy loan asset balance rose by 2.9% in 2014, resulting in policy loan income increase as a component of investment income.

o Yield – Average annualized yield was 4.22% for the three months of 2014 compared to 4.11% for the full year of 2013 and 3.86% for the three months ended March 31, 2013.

o Duration – The average maturity of the fixed income bond portfolio was 12.06 years with an estimated effective maturity of 7.03 years as of March 31, 2014.

INVESTOR CONFERENCE CALL

On Wednesday, May 7, 2014, Citizens will host a conference call to discuss operating results at 10:00 a.m. Central Time.  The conference call will be hosted by Rick D. Riley, Vice Chairman and President, Kay Osbourn, Chief Financial Officer, and other members of the Company’s management team.  To participate, please dial 888-481-2844 and ask to join the Citizens, Inc. call.  We recommend accessing the call three to five minutes before the call is scheduled to begin.  A recording of the conference call will be available on Citizens' website at www.citizensinc.com in the Investor Information section under News Release & Publications following the call.

ABOUT CITIZENS, INC.

Citizens, Inc. is a financial services company listed on the New York Stock Exchange under the symbol CIA.  The Company utilizes a three-pronged strategy for growth based upon worldwide sales of U.S. Dollar-denominated whole life cash value insurance policies, life insurance product sales in the U.S. and the acquisition of other U.S. based life insurance companies.

SAFE HARBOR

Information herein contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as “may,” “will,” “expect,” “anticipate” or “continue” or comparable words. In addition, all statements other than statements of historical facts that address activities that the Company expects or anticipates will or may occur in the future are forward-looking statements.  Readers are encouraged to read the SEC reports of the Company, particularly its Form 10-K for the fiscal year ended December 31, 2013, its quarterly reports on Form 10-Q and its current reports on Form 8-K, for the meaningful cautionary language disclosing why actual results may vary materially from those anticipated by management.  The Company undertakes no duty or obligation to update any forward-looking statements contained in this release as a result of new information, future events or changes in the Company’s expectations.  The Company also disclaims any duty to comment upon or correct information that may be contained in reports published by the investment community.

55

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Comprehensive Income

(In thousands, except per share amounts)

	Three Months Ended March 31,
	2014					2013
	(Unaudited)
Revenues:
Premiums:
Life insurance			$	41,397			39,414
Accident and health insurance			351				349
Property insurance			1,265				1,177
Net investment income			9,906				8,389
Realized investment gains (losses), net			(56		)		31
Other income			169				186
Total revenues			53,032				49,546
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders			16,457				14,806
Increase in future policy benefit reserves			17,698				16,959
Policyholders' dividends			2,102				2,074
Total insurance benefits paid or provided			36,257				33,839
Commissions			9,910				9,058
Other general expenses			6,502				6,699
Capitalization of deferred policy acquisition costs			(7,068		)		(6,362	)
Amortization of deferred policy acquisition costs			5,209				4,626
Amortization of cost of customer relationships acquired			531				578
Total benefits and expenses			51,341				48,438
Income before federal income tax			1,691				1,108
Federal income tax expense			494				252
Net income			1,197				856
Per Share Amounts:
Basic earnings per share of Class A common stock	$	0.02				0.02
Basic earnings per share of Class B common stock	0.01					0.01
Diluted earnings per share of Class A common stock	0.02					0.02
Diluted earnings per share of Class B common stock	0.01					0.01
Other comprehensive income:
Unrealized gains on available-for-sale securities:
Unrealized holding gains arising during period			14,096				96
Reclassification adjustment for gains (losses) included in net income			32				(31	)
Unrealized gains on available-for-sale securities, net			14,128				65
Income tax expense on unrealized gains on available-for-sale securities			4,954				27
Other comprehensive income			9,174				38
Comprehensive income			$	10,371			894

56

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Financial Position

(In thousands)

	March 31,		December 31,
	2014		2013
	(Unaudited)
Assets:
Investments:
Fixed maturities available-for-sale, at fair value	$	644,759	605,256
Fixed maturities held-to-maturity, at amortized cost	223,586		227,696
Equity securities available-for-sale, at fair value	49,845		47,259
Mortgage loans on real estate	659		671
Policy loans	50,288		48,868
Real estate held for investment	8,403		8,440
Other long-term investments	44		45
Short-term investments	—		—
Total investments	977,584		938,235
Cash and cash equivalents	52,307		54,593
Accrued investment income	12,803		12,251
Receivable for securities	1,707		—
Reinsurance recoverable	4,614		4,394
Deferred policy acquisition costs	148,443		146,691
Cost of customer relationships acquired	25,488		23,374
Goodwill	17,160		17,160
Other intangible assets	976		851
Federal income tax receivable	—		—
Property and equipment, net	6,688		6,662
Due premiums, net	10,387		11,209
Prepaid expenses	1,311		95
Other assets	741		765
Total assets	$	1,260,209	1,216,280

(Continued)

57

CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Financial Position, Continued

(In thousands)

	March 31,			December 31,
	2014			2013
	(Unaudited)
Liabilities:
Policy liabilities:
Future policy benefit reserves:
Life insurance	$	856,915		834,269
Annuities	55,833			55,485
Accident and health	1,221			1,250
Dividend accumulations	14,129			13,662
Premiums paid in advance	34,037			32,560
Policy claims payable	10,120			9,488
Other policyholders' funds	7,498			7,982
Total policy liabilities	979,753			954,696
Commissions payable	2,238			2,562
Federal income tax payable	2,107			590
Deferred federal income tax	6,621			1,704
Payable for securities in process of settlement	2,977			—
Other liabilities	10,333			10,919
Total liabilities	1,004,029			970,471
Stockholders' equity:
Class A, common stock	259,383			259,383
Class B, common stock	3,184			3,184
Accumulated deficit	(11,345		)	(12,542	)
Accumulated other comprehensive income:
Unrealized gains on securities, net of tax	15,969			6,795
Treasury stock, at cost	(11,011		)	(11,011	)
Total stockholders’ equity	256,180			245,809
Total liabilities and stockholders’ equity	$	1,260,209		1,216,280

58

XML

Fair Value Measurements Schedule of Fair Value Unobservable Input Reconciliation (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Abstract]
Balance at beginning of period	$ 309	$ 387
Total realized and unrealized gains (losses)
Included in net income	0	0
Included in other comprehensive income	0	(7)
Principal paydowns	(19)	(71)
Transfers in and (out) of Level 3	0	0
Balance at end of period	$ 290	$ 309

XML

Earnings Per Share

3 Months Ended

Mar. 31, 2014

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

The following tables set forth the computation of basic and diluted earnings per share.

	Three Months Ended
	March 31, 2014		March 31, 2013
	(In thousands, except per share amounts)
Basic and diluted earnings per share:
Numerator:
Net income	$	1,197	856
Net income allocated to Class A common stock	$	1,185	848
Net income allocated to Class B common stock	12		8
Net income	$	1,197	856
Denominator:
Weighted average shares of Class A outstanding - basic	49,080		49,080
Weighted average shares of Class A outstanding - diluted	49,080		49,080
Weighted average shares of Class B outstanding - basic and diluted	1,002		1,002
Basic earnings per share of Class A common stock	$	0.02	0.02
Basic earnings per share of Class B common stock	0.01		0.01
Diluted earnings per share of Class A common stock	0.02		0.02
Diluted earnings per share of Class B common stock	0.01		0.01

XML

Income Taxes (Details)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Income Tax Disclosure [Abstract]
Effective Income Tax Rate	29.20%	22.70%
Federal Statutory Income Tax Rate	35.00%

XML

Segment Information

3 Months Ended

Mar. 31, 2014

Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract]

Segment Information

Segment Information

The Company has three reportable segments:  Life Insurance, Home Service Insurance, and Other Non-Insurance Enterprises.  The accounting policies of the segments are in accordance with U.S. GAAP and are the same as those used in the preparation of the consolidated financial statements.  The Company evaluates profit and loss performance based on U.S. GAAP income before federal income taxes for its three reportable segments.

The Company has no reportable differences between segments and consolidated operations.

	Three Months Ended
	March 31, 2014
	Life Insurance			Home Service Insurance		Other Non-Insurance Enterprises		Consolidated
	(In thousands)
Revenues:
Premiums	$	31,811		11,202		—		43,013
Net investment income	6,283			3,287		336		9,906
Realized investment gains (losses), net	(64		)	8		—		(56	)
Other income	143			1		25		169
Total revenue	38,173			14,498		361		53,032
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders	10,815			5,642		—		16,457
Increase in future policy benefit reserves	16,976			722		—		17,698
Policyholders' dividends	2,086			16		—		2,102
Total insurance benefits paid or provided	29,877			6,380		—		36,257
Commissions	6,238			3,672		—		9,910
Other general expenses	2,840			3,169		493		6,502
Capitalization of deferred policy acquisition costs	(5,659		)	(1,409	)	—		(7,068	)
Amortization of deferred policy acquisition costs	4,407			802		—		5,209
Amortization of cost of customer relationships acquired	171			360		—		531
Total benefits and expenses	37,874			12,974		493		51,341
Income (loss) before income tax expense	$	299		1,524		(132	)	1,691

	Three Months Ended
	March 31, 2013
	Life Insurance			Home Service Insurance		Other Non-Insurance Enterprises		Consolidated
	(In thousands)
Revenues:
Premiums	$	30,117		10,823		—		40,940
Net investment income	4,904			3,180		305		8,389
Realized investment gains, net	—			30		1		31
Other income	63			90		33		186
Total revenue	35,084			14,123		339		49,546
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders	9,338			5,468		—		14,806
Increase in future policy benefit reserves	16,042			917		—		16,959
Policyholders' dividends	2,059			15		—		2,074
Total insurance benefits paid or provided	27,439			6,400		—		33,839
Commissions	5,579			3,479		—		9,058
Other general expenses	2,852			3,266		581		6,699
Capitalization of deferred policy acquisition costs	(5,086		)	(1,276	)	—		(6,362	)
Amortization of deferred policy acquisition costs	3,985			641		—		4,626
Amortization of cost of customer relationships acquired	167			411		—		578
Total benefits and expenses	34,936			12,921		581		48,438
Income (loss) before income tax expense	$	148		1,202		(242	)	1,108

XML

Consolidated Statements of Financial Position (Unaudited) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Investments:
Fixed maturities available-for-sale, at fair value (cost: $621,480 and $595,944 in 2014 and 2013, respectively)	$ 644,759	$ 605,256
Fixed maturities held-to-maturity, at amortized cost (fair value: $225,087 and $223,533 in 2014 and 2013, respectively)	223,586	227,696
Equity securities available-for-sale, at fair value (cost: $48,133 and $45,883 in 2014 and 2013, respectively)	49,845	47,259
Mortgage loans on real estate	659	671
Policy loans	50,288	48,868
Real estate held for investment (less $1,465 and $1,429 accumulated depreciation in 2014 and 2013, respectively)	8,403	8,440
Other long-term investments	44	45
Total investments	977,584	938,235
Cash and cash equivalents	52,307	54,593
Accrued investment income	12,803	12,251
Receivable for securities	1,707	0
Reinsurance recoverable	4,614	4,394
Deferred policy acquisition costs	148,443	146,691
Cost of customer relationships acquired	25,488	23,374
Goodwill	17,160	17,160
Other intangible assets	976	851
Property and equipment, net	6,688	6,662
Due premiums, net (less $1,312 and $1,429 allowance for doubtful accounts in 2014 and 2013, respectively)	10,387	11,209
Prepaid expenses	1,311	95
Other assets	741	765
Total assets	1,260,209	1,216,280
Future policy benefits reserves:
Life insurance	856,915	834,269
Annuities	55,833	55,485
Accident and health	1,221	1,250
Dividend accumulations	14,129	13,662
Premiums paid in advance	34,037	32,560
Policy claims payable	10,120	9,488
Other policyholders' funds	7,498	7,982
Total policy liabilities	979,753	954,696
Commissions payable	2,238	2,562
Federal income tax payable	2,107	590
Deferred federal income tax	6,621	1,704
Payable for securities in process of settlement	2,977	0
Other liabilities	10,333	10,919
Total liabilities	1,004,029	970,471
Commitments and contingencies (Note 7)
Stockholders' equity:
Accumulated deficit	(11,345)	(12,542)
Accumulated other comprehensive income:
Unrealized gains on securities, net of tax	15,969	6,795
Treasury stock, at cost	(11,011)	(11,011)
Total stockholders' equity	256,180	245,809
Total liabilities and stockholders' equity	1,260,209	1,216,280
Common Stock Class A [Member]
Stockholders' equity:
Common Stock	259,383	259,383
Common Stock Class B [Member]
Stockholders' equity:
Common Stock	$ 3,184	$ 3,184

XML

Financial Statements

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

Financial Statements

Basis of Presentation and Consolidation

The accompanying consolidated financial statements of Citizens, Inc. and its wholly-owned subsidiaries have been prepared in conformity with U.S. generally accepted accounting principles ("U.S. GAAP").

The consolidated financial statements include the accounts and operations of Citizens, Inc. ("Citizens"), a Colorado corporation, and its wholly-owned subsidiaries, CICA Life Insurance Company of America ("CICA"), Security Plan Life Insurance Company ("SPLIC"), Security Plan Fire Insurance Company ("SPFIC"), Citizens National Life Insurance Company ("CNLIC"), Magnolia Guaranty Life Insurance Company ("MGLIC"), Computing Technology, Inc. ("CTI") and Insurance Investors, Inc. ("III").  Citizens and its wholly-owned subsidiaries are collectively referred to as "the Company," "we," "us" or "our."

The consolidated statements of financial position for March 31, 2014, and the consolidated statements of comprehensive income and cash flows for the three-month periods ended March 31, 2014 and 2013, have been prepared by the Company without audit.  In the opinion of management, all adjustments to present fairly the financial position, results of operations, and changes in cash flows at March 31, 2014 and for comparative periods have been made.  The consolidated financial statements have been prepared in accordance with U.S. GAAP accounting principles for interim financial information and with the instructions to Form 10-Q adopted by the Securities and Exchange Commission (“SEC”).  Accordingly, the financial statements do not include all of the information and footnotes required for complete financial statements and should be read in conjunction with the Company’s consolidated financial statements, and notes thereto, for the year ended December 31, 2013.  Operating results for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year or any future period.

We provide primarily life insurance and a small amount of health insurance policies through our insurance subsidiaries:  CICA, SPLIC, MGLIC and CNLIC.  CICA and CNLIC issue ordinary whole-life policies, credit life and disability, burial insurance, pre-need policies, and accident and health related policies, throughout the Midwest and southern United States.  CICA also issues ordinary whole-life policies to non-U.S. residents.  SPLIC offers final expense and home service life insurance in Louisiana, Arkansas and Mississippi and SPFIC, a wholly-owned subsidiary of SPLIC, writes a limited amount of property insurance in Louisiana. MGLIC provides industrial life policies through independent funeral homes in Mississippi.

CTI provides data processing systems and services, as well as furniture and equipment, to the Company.  III provides aviation transportation to the Company.

In accordance with our purchase agreement dated October 7, 2013, we finalized the MGLIC stock acquisition on March 7, 2014 for approximately $5.2 million in cash consideration. The assets recorded as of March 31, 2014 were $11.9 million, liabilities of $6.6 million and stockholders equity of $5.3 million. We believe the goodwill will be minimal relative to this company purchase. We are continuing to finalize the actuarial estimates and intangibles which may result in changes from the amounts reported in this quarterly report on Form 10-Q. This entity will be reported as part of our home service segment business and is a wholly owned subsidiary of SPLIC.

Use of Estimates

The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

The most significant estimates include those used in the evaluation of other-than-temporary impairments on debt and equity securities and valuation allowances on investments, actuarially determined assets and liabilities and assumptions, goodwill impairment, valuation allowance on deferred tax assets, and contingencies relating to litigation and regulatory matters.  Certain of these estimates are particularly sensitive to market conditions, and deterioration and/or volatility in the worldwide debt or equity markets could have a material impact on the Consolidated Financial Statements.

Reclassification

Reclassifications have been made in the current year related to certain prior year reported amounts to provide consistent presentation. No individual amounts were material.

Significant Accounting Policies

For a description of significant accounting policies, see Note 1 of the Notes to Consolidated Financial Statements included in our 2013 Form 10-K Annual Report, which should be read in conjunction with these accompanying Consolidated Financial Statements.

XML

Earnings Per Share (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Net income	$ 1,197	$ 856
Common Class A [Member]
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Net Income Allocated to Class A Common Stock	1,185	848
Weighted Average Shares Outstanding, Basic	49,080	49,080
Weighted Average Shares Outstanding, Diluted	49,080	49,080
Basic earnings per share	$ 0.02	$ 0.02
Diluted earnings per share	$ 0.02	$ 0.02
Common Stock Class B [Member]
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Net Income Allocated to Class B Common Stock	$ 12	$ 8
Weighted Average Shares Outstanding, Basic and Diluted	1,002	1,002
Basic earnings per share	$ 0.01	$ 0.01
Diluted earnings per share	$ 0.01	$ 0.01

XML

Fair Value Measurements (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	$ 694,604	$ 652,515
Percent of Level 2 Debt Maturity to Total Reported Fair Value of Financial Assets	91.00%
Number of Private Placement Mortgage Backed Debt Securities in Level 3	2
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value	290	309	387
Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	62,485	59,722
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	631,829	592,484
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	290	309
US Treasury and Government [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	57,404	67,031
US Treasury and Government [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	12,640	12,463
US Treasury and Government [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	44,764	54,568
US Treasury and Government [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
US States and Political Subdivisions Debt Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	359,920	336,466
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	359,920	336,466
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Corporate Debt Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	223,183	197,561
Corporate Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Corporate Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	223,183	197,561
Corporate Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Mortgage-backed Securities, Issued by Private Enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	442	309
Mortgage-backed Securities, Issued by Private Enterprises [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Mortgage-backed Securities, Issued by Private Enterprises [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	152	0
Mortgage-backed Securities, Issued by Private Enterprises [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	290	309
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	3,679	3,762
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	3,679	3,762
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Foreign Government Debt Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	131	127
Foreign Government Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Foreign Government Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	131	127
Foreign Government Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Debt Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	644,759	605,256
Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	12,640	12,463
Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	631,829	592,484
Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	290	309
Stock Mutual Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	12,200	11,969
Stock Mutual Funds [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	12,200	11,969
Stock Mutual Funds [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Stock Mutual Funds [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Bond Mutual Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	34,791	34,663
Bond Mutual Funds [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	34,791	34,663
Bond Mutual Funds [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Bond Mutual Funds [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Common Stock [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	813	12
Common Stock [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	813	12
Common Stock [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Common Stock [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Preferred Stock [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	2,041	615
Preferred Stock [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	2,041	615
Preferred Stock [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Preferred Stock [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Equity Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	49,845	47,259
Equity Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	49,845	47,259
Equity Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Equity Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	$ 0	$ 0

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Accounting Pronouncements

3 Months Ended

Mar. 31, 2014

New Accounting Pronouncement or Change in Accounting Principle, Current Period Disclosures [Abstract]

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

Accounting Pronouncements

Accounting Standards Recently Adopted

On January 1, 2014, we adopted Accounting Standards Update (ASU) ASU 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists” to eliminate diversity in practice. This ASU requires that companies net their unrecognized tax benefits against all same-jurisdiction net operating losses or tax credit carryforwards that would be used to settle the position with a tax authority. The adoption of this ASU did not have an effect on our consolidated financial statements.

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Consolidated Statements of Financial Position (Unaudited) (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Investments:
Fixed maturities available-for-sale, cost	$ 621,480	$ 595,944
Fixed maturities held-to-maturity, fair value	225,087	223,533
Available-for-sale equity securities, amortized cost basis	48,133	45,883
Real estate held for investment, accumulated depreciation	1,465	1,429
Due premiums, allowance for doubtful accounts	$ 1,312	$ 1,429
Common Stock Class A [Member]
Stockholders' equity:
Common stock, par value (in dollars per share)	$ 0.00	$ 0.00
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	52,215,852	52,215,852
Common stock, shares in treasury (in shares)	3,135,738	3,135,738
Common Stock Class B [Member]
Stockholders' equity:
Common stock, par value (in dollars per share)	$ 0.00	$ 0.00
Common stock, shares authorized (in shares)	2,000,000	2,000,000
Common stock, shares issued (in shares)	1,001,714	1,001,714
Common stock, shares outstanding (in shares)	1,001,714	1,001,714

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Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2014

Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

The following tables set forth the computation of basic and diluted earnings per share.

	Three Months Ended
	March 31, 2014		March 31, 2013
	(In thousands, except per share amounts)
Basic and diluted earnings per share:
Numerator:
Net income	$	1,197	856
Net income allocated to Class A common stock	$	1,185	848
Net income allocated to Class B common stock	12		8
Net income	$	1,197	856
Denominator:
Weighted average shares of Class A outstanding - basic	49,080		49,080
Weighted average shares of Class A outstanding - diluted	49,080		49,080
Weighted average shares of Class B outstanding - basic and diluted	1,002		1,002
Basic earnings per share of Class A common stock	$	0.02	0.02
Basic earnings per share of Class B common stock	0.01		0.01
Diluted earnings per share of Class A common stock	0.02		0.02
Diluted earnings per share of Class B common stock	0.01		0.01

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Document and Entity Information	3 Months Ended
	Mar. 31, 2014	May 01, 2014 Common Stock Class A [Member]	May 01, 2014 Common Stock Class B [Member]
Entity Information [Line Items]
Entity Registrant Name	CITIZENS INC
Entity Central Index Key	0000024090
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Document Type	10-Q
Document Period End Date	Mar. 31, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		49,080,114	1,001,714

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Investments (Tables)

3 Months Ended

Mar. 31, 2014

Investments Including Short Term And Cash And Cash Equivalents [Abstract]

Investments Including Short Term And Cash And Cash Equivalents [Table Text Block]

The Company invests primarily in fixed maturity securities, which totaled 84.3% of total investments and cash and cash equivalents at March 31, 2014.

	March 31, 2014				December 31, 2013
	Carrying Value		% of Total Carrying Value		Carrying Value		% of Total Carrying Value
	(In thousands)				(In thousands)
Fixed maturity securities	$	868,345	84.3	%	$	832,952	83.9	%
Equity securities	49,845		4.8	%	47,259		4.8	%
Mortgage loans	659		0.1	%	671		0.1	%
Policy loans	50,288		4.9	%	48,868		4.8	%
Real estate and other long-term investments	8,447		0.8	%	8,485		0.9	%
Cash and cash equivalents	52,307		5.1	%	54,593		5.5	%
Total cash, cash equivalents and investments	$	1,029,891	100.0	%	$	992,828	100.0	%

Unrealized Gain (Loss) on Investments [Abstract]

Unrealized Gain (Loss) on Investments [Table Text Block]

The following tables represent the cost, gross unrealized gains and losses and fair value for fixed maturities and equity securities as of the periods indicated.

	March 31, 2014
	Cost or Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
	(In thousands)
Fixed maturities:
Available-for-sale:
U.S. Treasury securities	$	10,101	2,539	—	12,640
U.S. Government-sponsored enterprises	43,076		1,718	30	44,764
States and political subdivisions	355,633		10,529	6,242	359,920
Foreign governments	104		27	—	131
Corporate	208,740		14,883	440	223,183
Commercial mortgage-backed	432		10	—	442
Residential mortgage-backed	3,394		287	2	3,679
Total available-for-sale securities	621,480		29,993	6,714	644,759
Held-to-maturity securities:
U.S. Government-sponsored enterprises	5,846		249	—	6,095
States and political subdivisions	183,868		3,975	3,400	184,443
Corporate	33,872		853	176	34,549
Total held-to-maturity securities	223,586		5,077	3,576	225,087
Total fixed maturities	$	845,066	35,070	10,290	869,846
Equity securities:
Stock mutual funds	$	10,463	1,737	—	12,200
Bond mutual funds	35,080		29	318	34,791
Common stock	810		10	7	813
Preferred stock	1,780		269	8	2,041
Total equity securities	$	48,133	2,045	333	49,845

	December 31, 2013
	Cost or Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
	(In thousands)
Fixed maturities:
Available-for-sale securities:
U.S. Treasury securities	$	10,115	2,348	—	12,463
U.S. Government-sponsored enterprises	53,587		1,209	228	54,568
States and political subdivisions	341,673		6,242	11,449	336,466
Foreign governments	104		23	—	127
Corporate	186,671		12,289	1,399	197,561
Commercial mortgage-backed	300		9	—	309
Residential mortgage-backed	3,494		270	2	3,762
Total available-for-sale securities	595,944		22,390	13,078	605,256
Held-to-maturity securities:
U.S. Government-sponsored enterprises	8,877		197	3	9,071
States and political subdivisions	181,246		1,633	6,412	176,467
Corporate	37,573		771	349	37,995
Total held-to-maturity securities	227,696		2,601	6,764	223,533
Total fixed maturity securities	$	823,640	24,991	19,842	828,789
Equity securities:
Stock mutual funds	$	10,463	1,506	—	11,969
Bond mutual funds	35,080		—	417	34,663
Common stock	17		—	5	12
Preferred stock	323		292	—	615
Total equity securities	$	45,883	1,798	422	47,259

Unrealized Continuous Losses on Investments [Abstract]

Schedule of Unrealized Loss on Investments [Table Text Block]

The following tables present the fair values and gross unrealized losses of fixed maturities and equity securities that have remained in a continuous unrealized loss position for the periods indicated.

	March 31, 2014
	Less than 12 months				Greater than 12 months			Total
	Fair Value		Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities
	(In thousands, except for # of securities)
Fixed maturities:
Available-for-sale securities:
U.S. Government-sponsored enterprises	$	1,285	9	6	830	21	1	2,115	30	7
States and political subdivisions	128,340		5,149	137	21,095	1,093	23	149,435	6,242	160
Corporate	38,641		286	34	2,623	154	2	41,264	440	36
Residential mortgage-backed	61		1	5	40	1	1	101	2	6
Total available-for-sale securities	168,327		5,445	182	24,588	1,269	27	192,915	6,714	209
Held-to-maturity securities:
States and political subdivisions	74,114		3,031	87	11,710	369	18	85,824	3,400	105
Corporate	5,395		176	4	—	—	—	5,395	176	4
Total held-to-maturity securities	79,509		3,207	91	11,710	369	18	91,219	3,576	109
Total fixed maturities	$	247,836	8,652	273	36,298	1,638	45	284,134	10,290	318
Equity securities:
Bond mutual funds	$	27,682	318	3	—	—	—	27,682	318	3
Common stocks	136		3	1	13	4	1	149	7	2
Preferred stocks	338		8	8	—	—	—	338	8	8
Total equities	$	28,156	329	12	13	4	1	28,169	333	13

As of March 31, 2014, the Company had 27 available-for-sale securities and 18 held-to-maturity securities that were in an unrealized loss position for greater than 12 months. We reported 1 common stock holding in an unrealized loss position as of March 31, 2014.

	December 31, 2013
	Less than 12 months				Greater than 12 months			Total
	Fair Value		Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities
	(In thousands, except for # of securities)
Fixed maturities:
Available-for-sale securities:
U.S. Government-sponsored enterprises	$	14,032	228	12	—	—	—	14,032	228	12
States and political subdivisions	183,280		9,872	203	15,673	1,577	16	198,953	11,449	219
Corporate	35,789		1,048	25	2,426	351	2	38,215	1,399	27
Residential mortgage-backed	57		1	3	42	1	1	99	2	4
Total available-for-sale securities	233,158		11,149	243	18,141	1,929	19	251,299	13,078	262
Held-to-maturity securities:
U.S. Government-sponsored enterprises	2,997		3	1	—	—	—	2,997	3	1
States and political subdivisions	100,153		5,236	118	14,797	1,176	17	114,950	6,412	135
Corporate	5,225		349	4	—	—	—	5,225	349	4
Total held-to-maturity securities	108,375		5,588	123	14,797	1,176	17	123,172	6,764	140
Total fixed maturities	$	341,533	16,737	366	32,938	3,105	36	374,471	19,842	402
Equity securities:
Bond mutual funds	$	34,663	417	7	—	—	—	34,663	417	7
Common stock	12		5	1	—	—	—	12	5	1
Total equities	$	34,675	422	8	—	—	—	34,675	422	8

Available-for-sale Securities, Gross Realized Gain (Loss) [Abstract]

Schedule of Realized Gain (Loss) [Table Text Block]

The Company uses the specific identification method of the individual security to determine the cost basis used in the calculation of realized gains and losses related to security sales.  Proceeds and gross realized gains from sales of securities for the three months ended March 31, 2014 and 2013 are summarized as follows.

		Fixed Maturities, Available-for-sale			Equity Securities
		Three Months Ended			Three Months Ended
		March 31,			March 31,
		2014		2013	2014	2013
	(In thousands)
Proceeds		$	—	58	—	—
Gross realized gains		$	—	1	—	—
Gross realized losses		$	—	—	—	—

Schedule of Fixed Maturities [Abstract]

Investments Classified by Contractual Maturity Date [Table Text Block]

The amortized cost and fair value of fixed maturity securities at March 31, 2014 by contractual maturity are shown in the table below.  Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date have been reflected based upon final stated maturity.

	March 31, 2014
	Amortized Cost		Fair Value
	(In thousands)
Available-for-sale securities:
Due in one year or less	$	15,507	15,818
Due after one year through five years	117,719		125,050
Due after five years through ten years	104,920		108,876
Due after ten years	383,334		395,015
Total available-for-sale securities	621,480		644,759
Held-to-maturity securities:
Due in one year or less	10,453		10,515
Due after one year through five years	31,897		32,581
Due after five years through ten years	43,214		44,633
Due after ten years	138,022		137,358
Total held-to-maturity securities	223,586		225,087
Total fixed maturities	$	845,066	869,846

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Consolidated Statements of Comprehensive Income (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Premiums:
Life insurance	$ 41,397	$ 39,414
Accident and health insurance	351	349
Property insurance	1,265	1,177
Net investment income	9,906	8,389
Realized investment (losses) gains, net	(56)	31
Other income	169	186
Total revenue	53,032	49,546
Insurance benefits paid or provided:
Claims and surrenders	16,457	14,806
Increase in future policy benefit reserves	17,698	16,959
Policyholders' dividends	2,102	2,074
Total insurance benefits paid or provided	36,257	33,839
Commissions	9,910	9,058
Other general expenses	6,502	6,699
Capitalization of deferred policy acquisition costs	(7,068)	(6,362)
Amortization of deferred policy acquisition costs	5,209	4,626
Amortization of cost of customer relationships acquired	531	578
Total benefits and expenses	51,341	48,438
Income before federal income tax	1,691	1,108
Federal income tax expense	494	252
Net income	1,197	856
Unrealized gains on available-for-sale securities:
Unrealized holding gains arising during period	14,096	96
Reclassification adjustments for gains (losses) included in net income	32	(31)
Unrealized gains on available-for-sale securities, net	14,128	65
Income tax expense on unrealized gains on available-for-sale securities	4,954	27
Other comprehensive income	9,174	38
Comprehensive income	$ 10,371	$ 894
Common Stock Class A [Member]
Earnings Per Share [Abstract]
Basic earnings per share (in dollars per share)	$ 0.02	$ 0.02
Diluted earnings per share (in dollars per share)	$ 0.02	$ 0.02
Common Stock Class B [Member]
Earnings Per Share [Abstract]
Basic earnings per share (in dollars per share)	$ 0.01	$ 0.01
Diluted earnings per share (in dollars per share)	$ 0.01	$ 0.01

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

We are a defendant in a lawsuit filed on August 6, 1999, in the Texas District Court, Austin, Texas, now styled Delia Bolanos Andrade, et al., Plaintiffs, v. Citizens Insurance Company of America, et al., Defendants in which a class was originally certified by the trial court and reversed by the Texas Supreme Court in 2007 with an order to the trial court to conduct further proceedings consistent with its ruling.  The underlying lawsuit alleged that certain life insurance policies CICA made available to non-U.S. residents, when combined with a policy feature that allowed certain cash benefits to be assigned to two non-U.S. trusts for the purpose of accumulating ownership of our Class A common stock, along with allowing the policyholders to make additional contributions to the trusts, were actually offers and sales of securities that occurred in Texas by unregistered dealers in violation of the Texas securities laws.  The remedy sought was rescission and return of the insurance premium payments.  On December 9, 2009, the trial court denied the recertification of the class after conducting additional proceedings in accordance with the Texas Supreme Court's ruling.  The remaining plaintiffs must now proceed individually, and not as a class, if they intend to pursue their claims against us.  Since the December 9, 2009 trial court ruling, no individual cases have been further pursued by the plaintiffs.  The probability of the plaintiffs further pursuing their cases individually remains unknown.  An estimate of any possible loss or range of losses cannot be made at this time in regard to individuals pursuing claims.  However, should the plaintiffs further pursue their claims individually, we intend to vigorously defend any proceedings.

The Company is currently performing an internal audit related to unclaimed property for all legal reporting entities. Based upon internal findings to date our exposure appears to be primarily in the state of Louisiana, related to conversion processes surrounding the SPLIC acquisition. The Company had been informed by the Louisiana Department of Treasury, Arkansas Auditor of State and the Texas State Comptroller, that they authorized an audit of Citizens, Inc. and its affiliates for compliance with unclaimed property laws. This audit is being conducted by Verus Financial LLC on behalf of the states.

These internal and external audits may result in additional payments to beneficiaries, additional escheatment of funds deemed abandoned under state laws, administrative penalties, interest, and changes to the Company's procedures for the identification and escheatment of abandoned property.  At this time, the Company is not able to estimate any of these possible amounts, but such costs could be substantial for a company our size.

We defend all claims vigorously.  However, in doing so, we could incur significant defense costs, including attorneys' fees, other direct litigation costs and the expenditure of substantial amounts of management time that otherwise would be devoted to our business.  If we suffer an adverse judgment as a result of litigation claims, it could have a material adverse effect on our business, results of operations and financial condition.

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Fair Value Measurements

3 Months Ended

Mar. 31, 2014

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  We hold available-for-sale fixed maturity securities and equity securities, which are carried at fair value.

Fair value measurements are generally based upon observable and unobservable inputs.  Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our view of market assumptions in the absence of observable market information.  We utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.  All assets and liabilities carried at fair value are required to be classified and disclosed in one of the following three categories:

• Level 1 - Quoted prices for identical instruments in active markets.

• Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs or whose significant value drivers are observable.

• Level 3 - Instruments whose significant value drivers are unobservable.

Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as U.S. Treasury securities and actively traded mutual fund and stock investments.

Level 2 includes those financial instruments that are valued by independent pricing services or broker quotes.  These models are primarily industry-standard models that consider various inputs, such as interest rates, credit spreads and foreign exchange rates for the underlying financial instruments.  All significant inputs are observable, or derived from observable information in the marketplace or are supported by observable levels at which transactions are executed in the marketplace.  Financial instruments in this category primarily include corporate securities, U.S. Government-sponsored enterprise securities, municipal securities and certain mortgage and asset-backed securities.

Level 3 is comprised of financial instruments whose fair value is estimated based on non-binding broker prices utilizing significant inputs not based on or corroborated by readily available market information.  This category consists of two private placement mortgage-backed securities.

The following tables set forth our assets and liabilities that are measured at fair value on a recurring basis as of the dates indicated.

	March 31, 2014
Available-for-sale investments	Level 1		Level 2	Level 3	Total Fair Value
	(In thousands)
Financial assets:
Fixed maturities:
U.S. Treasury and U.S. Government-sponsored enterprises	$	12,640	44,764	—	57,404
States and political subdivisions	—		359,920	—	359,920
Corporate	—		223,183	—	223,183
Commercial mortgage-backed	—		152	290	442
Residential mortgage-backed	—		3,679	—	3,679
Foreign governments	—		131	—	131
Total fixed maturities	12,640		631,829	290	644,759
Equity securities:
Stock mutual funds	12,200		—	—	12,200
Bond mutual funds	34,791		—	—	34,791
Common stock	813		—	—	813
Preferred stock	2,041		—	—	2,041
Total equity securities	49,845		—	—	49,845
Total financial assets	$	62,485	631,829	290	694,604

	December 31, 2013
Available-for-sale investments	Level 1		Level 2	Level 3	Total Fair Value
	(In thousands)
Financial assets:
Fixed maturities:
U.S. Treasury and U.S. Government-sponsored enterprises	$	12,463	54,568	—	67,031
States and political subdivisions	—		336,466	—	336,466
Corporate	—		197,561	—	197,561
Commercial mortgage-backed	—		—	309	309
Residential mortgage-backed	—		3,762	—	3,762
Foreign governments	—		127	—	127
Total fixed maturities	12,463		592,484	309	605,256
Equity securities:
Stock mutual funds	11,969		—	—	11,969
Bond mutual funds	34,663		—	—	34,663
Common stock	12		—	—	12
Preferred stock	615		—	—	615
Total equity securities	47,259		—	—	47,259
Total financial assets	$	59,722	592,484	309	652,515

Financial Instruments Valuation

Fixed maturity securities, available-for-sale.  At March 31, 2014, our fixed maturity securities, valued using a third-party pricing source, totaled $631.8 million for Level 2 assets and comprised 91.0% of total reported fair value of our financial assets.  The Level 1 and Level 2 valuations are reviewed and updated quarterly through random testing by comparisons to separate pricing models, other third-party pricing services, and back tested to recent trades.  In addition, we obtain information relative to the third-party pricing models and review model parameters for reasonableness.  Fair values for Level 3 assets are based upon unadjusted broker quotes that are non-binding, and consist of two private placement mortgage-backed securities with a total value of $0.3 million.  Our Level 3 assets are current relative to principal and interest payments and are considered immaterial to our financial statements.  For the three months ended March 31, 2014, there were no material changes to the valuation methods or assumptions used to determine fair values, and no broker or third party prices were changed from the values received.

Equity securities, available-for-sale.  Our available-for-sale equity securities are classified as Level 1 assets as their fair values are based upon quoted market prices.

The following table presents additional information about fixed maturity securities measured at fair value on a recurring basis that are classified as Level 3 assets and for which we have utilized significant unobservable inputs to determine fair value.

	March 31, 2014			December 31, 2013
	(In thousands)
Balance at beginning of period	$	309		387
Total realized and unrealized gains (losses)
Included in net income	—			—
Included in other comprehensive income	—			(7	)
Principal paydowns	(19		)	(71	)
Transfer in and (out) of Level 3	—			—
Balance at end of period	$	290		309

We review the fair value hierarchy classifications each reporting period.  Changes in the observability of the valuation attributes may result in a reclassification of certain financial assets.  Such reclassifications are reported as transfers in and out of Level 3 at the beginning fair value for the reporting period in which the changes occur. There were no transfers in or out of Level 1 or 2.

Financial Instruments not Carried at Fair Value

Estimates of fair values are made at a specific point in time, based on relevant market prices and information about the financial instruments.  The estimated fair values of financial instruments presented below are not necessarily indicative of the amounts the Company might realize in actual market transactions.

The carrying amount and fair value for the financial assets and liabilities on the consolidated balance sheets not otherwise disclosed for the periods indicated are as follows:

	March 31, 2014			December 31, 2013
	Carrying Value		Fair Value	Carrying Value	Fair Value
	(In thousands)
Financial assets:
Fixed maturities, held-to-maturity	$	223,586	225,087	227,696	223,533
Mortgage loans	659		684	671	695
Policy loans	50,288		50,288	48,868	48,868
Cash and cash equivalents	52,307		52,307	54,593	54,593
Financial liabilities:
Annuity - investment contracts	39,650		43,086	39,469	44,960

Fair values for fixed income securities, which are characterized as Level 2 assets in the fair value hierarchy, are based on quoted market prices for the same or similar securities.  In cases where quoted market prices are not available, fair values are based on estimates using present value or other assumptions, including a discount rate and estimates of future cash flows.

Mortgage loans are secured principally by residential and commercial properties.  Weighted average interest rates for these loans were approximately 6.4% as of March 31, 2014 and December 31, 2013, with maturities ranging from 1 to 30 years.  Management estimated the fair value using an annual interest rate of 6.25% at March 31, 2014.  Our mortgage loans are considered Level 3 assets in the fair value hierarchy.

Policy loans had a weighted average annual interest rate of 7.7% as of March 31, 2014 and December 31, 2013, and no specified maturity dates.  The aggregate fair value of policy loans approximates the carrying value reflected on the consolidated balance sheets.  These loans typically carry an interest rate that is tied to the crediting rate applied to the related policy and contract reserves.  Policy loans are an integral part of the life insurance policies we have in force, cannot be valued separately and are not marketable.  Therefore, the fair value of policy loans approximates the carrying value and policy loans are considered Level 3 assets in the fair value hierarchy.

The fair value of short-term investments approximate carrying value due to their short-term nature.  Our short-term investments are considered Level 2 assets in the fair value hierarchy.

The fair value of cash and cash equivalents approximate carrying value and are characterized as Level 1 assets in the fair value hierarchy.

The fair value of the Company's liabilities under annuity contract policies, which are considered Level 3 assets, was estimated at March 31, 2014 using discounted cash flows based upon a swap rate curve with interest rates ranging from 0.24% to 4.03% based upon swap rates adjusted for various risk adjustments. The fair value of liabilities under all insurance contracts are taken into consideration in the overall management of interest rate risk, which seeks to minimize exposure to changing interest rates through the matching of investment maturities with amounts due under insurance contracts.

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Investments (Details) (USD $)	3 Months Ended		12 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013	Dec. 31, 2012
Investments Including Short Term And Cash And Cash Equivalents [Abstract]
Fixed maturity securities	$ 868,345,000		$ 832,952,000
Fixed maturity securities percent	84.30%		83.90%
Equity securities	49,845,000		47,259,000
Equity securities percent	4.80%		4.80%
Mortgage loans	659,000		671,000
Mortgage loans percent	0.10%		0.10%
Policy loans	50,288,000		48,868,000
Policy loans percent	4.90%		4.80%
Real estate and other long-term investments	8,447,000		8,485,000
Real estate and other long-term investments percent	0.80%		0.90%
Cash and cash equivalents	52,307,000	42,608,000	54,593,000	56,299,000
Cash and cash equivalents percent	5.10%		5.50%
Total cash, cash equivalents and investments	1,029,891,000		992,828,000
Total cash, cash equivalents and investments percent	100.00%		100.00%
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Debt Securities, Amortized Cost Basis	621,480,000		595,944,000
Available-for-sale Equity Securities, Amortized Cost Basis	48,133,000		45,883,000
Available-for-sale Securities, Fair Value	694,604,000		652,515,000
Available-for-sale Securities, Debt Securities, Amortized Cost Basis, Total	621,480,000		595,944,000
Available-for-sale Debt Securities, Gross Unrealized Gains, Total	29,993,000		22,390,000
Available-for-sale Debt Securities, Gross Unrealized Losses, Total	6,714,000		13,078,000
Available-for-sale Debt Securities, Fair Value	644,759,000		605,256,000
Held-to-maturity Securities, Debt Securities, Net Carrying Amount	223,586,000		227,696,000
Held-to-maturity Securities, Unrecognized Holding Gain	5,077,000		2,601,000
Held-to-maturity Securities, Unrecognized Holding Loss	3,576,000		6,764,000
Held-to-maturity Securities, Fair Value	225,087,000		223,533,000
Total Fixed Maturity Securities, Amortized Cost	845,066,000
Total Fixed Maturity Securities, Fair Value	869,846,000
Unrealized Continuous Losses on Investments [Abstract]
Number of Available-for-sale Securities In Continuous Loss Position Aggregate	209		262
Debt Securities In Continuous Loss Less Than 12 Months Fair Value	247,836,000		341,533,000
Debt Securities Continuous Loss Position Less Than 12 Months Unrealized Losses	8,652,000		16,737,000
Number of Debt Securities In Continuous Loss Less Than 12 Months	273		366
Debt Securities In Continuous Loss Position 12 Months Or Longer, Fair Value	36,298,000		32,938,000
Debt Securities In Continuous Loss Position 12 Months Or Longer, Unrealized Losses	1,638,000		3,105,000
Number of Debt Securities In Continuous Loss Position 12 Months or Longer	45		36
Debt Securities In Continuous Loss Position, Aggregate Fair Value	284,134,000		374,471,000
Debt Securities In Continuous Loss Position, Aggregate Unrealized Losses	10,290,000		19,842,000
Number of Debt Securities In Continuous Loss Position, Aggregate	318		402
Available-for-sale Securities, Gross Realized Gain (Loss) [Abstract]
Proceeds from Sale of Available-for-sale Securities, Fixed Maturities	0	58,000
Proceeds from Sale of Available-for-sale Securities, Equity	0	0
Schedule of Fixed Maturities [Abstract]
Available-for-sale Securities, Debt Maturities, Due in One Year or Less, Amortized Cost Basis	15,507,000
Available-for-sale Securities, Debt Maturities, Due in One Year or Less, Fair Value	15,818,000
Available-for-sale Securities, Debt Maturities, Due After One Year Through Five Years, Amortized Cost Basis	117,719,000
Available-for-sale Securities, Debt Maturities, Due After One Year Through Five Years, Fair Value	125,050,000
Available-for-sale Securities, Debt Maturities, Due After Five Years Through Ten Years, Amortized Cost Basis	104,920,000
Available-for-sale Securities, Debt Maturities, Due After Five Years Through Ten Years, Fair Value	108,876,000
Available-for-sale Securities, Debt Maturities, Due After Ten Years, Amortized Cost Basis	383,334,000
Available-for-sale Securities, Debt Maturities, Due After Ten Years, Fair Value	395,015,000
Held-to-maturity Securities, Debt Maturities, Due in One Year or Less, Amortized Cost Basis	10,453,000
Held-to-maturity Securities, Debt Maturities, Due in One Year or Less, Fair Value	10,515,000
Held-to-maturity Securities, Debt Maturities, Due After One Year Through Five Years, Amortized Cost Basis	31,897,000
Held-to-maturity Securities, Debt Maturities, Due After One Year Through Five Years, Fair Value	32,581,000
Held-to-maturity Securities, Debt Maturities, Due After Five Years Through Ten Years, Amortized Cost Basis	43,214,000
Held-to-maturity Securities, Debt Maturities, Due After Five Years Through Ten Years, Fair Value	44,633,000
Held-to-maturity Securities, Debt Maturities, Due After Ten Years, Amortized Cost Basis	138,022,000
Held-to-maturity Securities, Debt Maturities, Due After Ten Years, Fair Value	137,358,000
Sale of bonds, number of securities sold at a loss	0	0
Sale of bonds, number of held-to-maturity bonds sold	0	0
US Treasury Securities [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Debt Securities, Amortized Cost Basis	10,101,000		10,115,000
Available-for-sale Securities, Gross Unrealized Gains	2,539,000		2,348,000
Available-for-sale Securities, Gross Unrealized Losses	0		0
Available-for-sale Securities, Fair Value	12,640,000		12,463,000
US Government Agencies Debt Securities [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Debt Securities, Amortized Cost Basis	43,076,000		53,587,000
Available-for-sale Securities, Gross Unrealized Gains	1,718,000		1,209,000
Available-for-sale Securities, Gross Unrealized Losses	30,000		228,000
Available-for-sale Securities, Fair Value	44,764,000		54,568,000
Held-to-maturity Securities, Debt Securities, Net Carrying Amount	5,846,000		8,877,000
Held-to-maturity Securities, Unrecognized Holding Gain	249,000		197,000
Held-to-maturity Securities, Unrecognized Holding Loss	0		3,000
Held-to-maturity Securities, Fair Value	6,095,000		9,071,000
Unrealized Continuous Losses on Investments [Abstract]
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	1,285,000		14,032,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	9,000		228,000
Number of Available-for-sale Securities In Continuous Loss Position Less Than 12 Months	6		12
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	830,000		0
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	21,000		0
Number of Available-for-sale Securities In Continuous Loss Position For 12 months or Greater	1		0
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	2,115,000		14,032,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	30,000		228,000
Number of Available-for-sale Securities In Continuous Loss Position Aggregate	7		12
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value			2,997,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses			3,000
Number of Held-to-maturity Securities In Continuous Loss Position Less Than 12 Months			1
Held-to-maturity Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value			0
Held-to-maturity Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses			0
Number of Held-to-maturity Securities In Continuous Loss Position 12 Months or Greater			0
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value			2,997,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Losses			3,000
Number of Held-to-maturity Securities In Continuous Loss Position Aggregate			1
US States and Political Subdivisions Debt Securities [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Debt Securities, Amortized Cost Basis	355,633,000		341,673,000
Available-for-sale Securities, Gross Unrealized Gains	10,529,000		6,242,000
Available-for-sale Securities, Gross Unrealized Losses	6,242,000		11,449,000
Available-for-sale Securities, Fair Value	359,920,000		336,466,000
Held-to-maturity Securities, Debt Securities, Net Carrying Amount	183,868,000		181,246,000
Held-to-maturity Securities, Unrecognized Holding Gain	3,975,000		1,633,000
Held-to-maturity Securities, Unrecognized Holding Loss	3,400,000		6,412,000
Held-to-maturity Securities, Fair Value	184,443,000		176,467,000
Unrealized Continuous Losses on Investments [Abstract]
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	128,340,000		183,280,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	5,149,000		9,872,000
Number of Available-for-sale Securities In Continuous Loss Position Less Than 12 Months	137		203
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	21,095,000		15,673,000
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	1,093,000		1,577,000
Number of Available-for-sale Securities In Continuous Loss Position For 12 months or Greater	23		16
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	149,435,000		198,953,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	6,242,000		11,449,000
Number of Available-for-sale Securities In Continuous Loss Position Aggregate	160		219
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	74,114,000		100,153,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	3,031,000		5,236,000
Number of Held-to-maturity Securities In Continuous Loss Position Less Than 12 Months	87		118
Held-to-maturity Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	11,710,000		14,797,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	369,000		1,176,000
Number of Held-to-maturity Securities In Continuous Loss Position 12 Months or Greater	18		17
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value	85,824,000		114,950,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Losses	3,400,000		6,412,000
Number of Held-to-maturity Securities In Continuous Loss Position Aggregate	105		135
Foreign Government Debt Securities [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Debt Securities, Amortized Cost Basis	104,000		104,000
Available-for-sale Securities, Gross Unrealized Gains	27,000		23,000
Available-for-sale Securities, Gross Unrealized Losses	0		0
Available-for-sale Securities, Fair Value	131,000		127,000
Corporate Debt Securities [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Debt Securities, Amortized Cost Basis	208,740,000		186,671,000
Available-for-sale Securities, Gross Unrealized Gains	14,883,000		12,289,000
Available-for-sale Securities, Gross Unrealized Losses	440,000		1,399,000
Available-for-sale Securities, Fair Value	223,183,000		197,561,000
Held-to-maturity Securities, Debt Securities, Net Carrying Amount	33,872,000		37,573,000
Held-to-maturity Securities, Unrecognized Holding Gain	853,000		771,000
Held-to-maturity Securities, Unrecognized Holding Loss	176,000		349,000
Held-to-maturity Securities, Fair Value	34,549,000		37,995,000
Unrealized Continuous Losses on Investments [Abstract]
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	38,641,000		35,789,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	286,000		1,048,000
Number of Available-for-sale Securities In Continuous Loss Position Less Than 12 Months	34		25
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	2,623,000		2,426,000
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	154,000		351,000
Number of Available-for-sale Securities In Continuous Loss Position For 12 months or Greater	2		2
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	41,264,000		38,215,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	440,000		1,399,000
Number of Available-for-sale Securities In Continuous Loss Position Aggregate	36		27
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	5,395,000		5,225,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	176,000		349,000
Number of Held-to-maturity Securities In Continuous Loss Position Less Than 12 Months	4		4
Held-to-maturity Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	0		0
Held-to-maturity Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	0		0
Number of Held-to-maturity Securities In Continuous Loss Position 12 Months or Greater	0		0
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value	5,395,000		5,225,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Losses	176,000		349,000
Number of Held-to-maturity Securities In Continuous Loss Position Aggregate	4		4
Collateralized Mortgage Backed Securities [Member]
Schedule of Fixed Maturities And Equity Securities [Line Items]
Available-for-sale Securities, Debt Maturities, without Single Maturity Date, Amortized Cost Basis	3,800,000
Commercial Mortgage Backed Securities [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Debt Securities, Amortized Cost Basis	432,000		300,000
Available-for-sale Securities, Gross Unrealized Gains	10,000		9,000
Available-for-sale Securities, Gross Unrealized Losses	0		0
Available-for-sale Securities, Fair Value	442,000		309,000
Residential Mortgage Backed Securities [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Debt Securities, Amortized Cost Basis	3,394,000		3,494,000
Available-for-sale Securities, Gross Unrealized Gains	287,000		270,000
Available-for-sale Securities, Gross Unrealized Losses	2,000		2,000
Available-for-sale Securities, Fair Value	3,679,000		3,762,000
Unrealized Continuous Losses on Investments [Abstract]
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	61,000		57,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	1,000		1,000
Number of Available-for-sale Securities In Continuous Loss Position Less Than 12 Months	5		3
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	40,000		42,000
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	1,000		1,000
Number of Available-for-sale Securities In Continuous Loss Position For 12 months or Greater	1		1
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	101,000		99,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	2,000		2,000
Number of Available-for-sale Securities In Continuous Loss Position Aggregate	6		4
Debt Securities [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Total Fixed Maturity Securities, Amortized Cost	845,066,000		823,640,000
Total Fixed Maturity Securities, Gross Unrealized Gains	35,070,000		24,991,000
Total Fixed Maturity Securities, Gross Unrealized Losses	10,290,000		19,842,000
Total Fixed Maturity Securities, Fair Value	869,846,000		828,789,000
Unrealized Continuous Losses on Investments [Abstract]
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	168,327,000		233,158,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	5,445,000		11,149,000
Number of Available-for-sale Securities In Continuous Loss Position Less Than 12 Months	182		243
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	24,588,000		18,141,000
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	1,269,000		1,929,000
Number of Available-for-sale Securities In Continuous Loss Position For 12 months or Greater	27		19
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	192,915,000		251,299,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	6,714,000		13,078,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	79,509,000		108,375,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	3,207,000		5,588,000
Number of Held-to-maturity Securities In Continuous Loss Position Less Than 12 Months	91		123
Held-to-maturity Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	11,710,000		14,797,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	369,000		1,176,000
Number of Held-to-maturity Securities In Continuous Loss Position 12 Months or Greater	18		17
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value	91,219,000		123,172,000
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Losses	3,576,000		6,764,000
Number of Held-to-maturity Securities In Continuous Loss Position Aggregate	109		140
Available-for-sale Securities, Gross Realized Gain (Loss) [Abstract]
Available-for-sale Securities, Gross Realized Gains	0	1,000
Available-for-sale Securities, Gross Realized Losses	0	0
Stock Mutual Funds [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Equity Securities, Amortized Cost Basis	10,463,000		10,463,000
Available-for-sale Securities, Gross Unrealized Gains	1,737,000		1,506,000
Available-for-sale Securities, Gross Unrealized Losses	0		0
Available-for-sale Securities, Fair Value	12,200,000		11,969,000
Bond Mutual Funds [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Equity Securities, Amortized Cost Basis	35,080,000		35,080,000
Available-for-sale Securities, Gross Unrealized Gains	29,000		0
Available-for-sale Securities, Gross Unrealized Losses	318,000		417,000
Available-for-sale Securities, Fair Value	34,791,000		34,663,000
Unrealized Continuous Losses on Investments [Abstract]
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	27,682,000		34,663,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	318,000		417,000
Number of Available-for-sale Securities In Continuous Loss Position Less Than 12 Months	3		7
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	0		0
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	0		0
Number of Available-for-sale Securities In Continuous Loss Position For 12 months or Greater	0		0
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	27,682,000		34,663,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	318,000		417,000
Number of Available-for-sale Securities In Continuous Loss Position Aggregate	3		7
Common Stock [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Equity Securities, Amortized Cost Basis	810,000		17,000
Available-for-sale Securities, Gross Unrealized Gains	10,000		0
Available-for-sale Securities, Gross Unrealized Losses	7,000		5,000
Available-for-sale Securities, Fair Value	813,000		12,000
Unrealized Continuous Losses on Investments [Abstract]
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	136,000		12,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	3,000		5,000
Number of Available-for-sale Securities In Continuous Loss Position Less Than 12 Months	1		1
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	13,000		0
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	4,000		0
Number of Available-for-sale Securities In Continuous Loss Position For 12 months or Greater	1		0
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	149,000		12,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	7,000		5,000
Number of Available-for-sale Securities In Continuous Loss Position Aggregate	2		1
Preferred Stock [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Equity Securities, Amortized Cost Basis	1,780,000		323,000
Available-for-sale Securities, Gross Unrealized Gains	269,000		292,000
Available-for-sale Securities, Gross Unrealized Losses	8,000		0
Available-for-sale Securities, Fair Value	2,041,000		615,000
Unrealized Continuous Losses on Investments [Abstract]
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	338,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	8,000
Number of Available-for-sale Securities In Continuous Loss Position Less Than 12 Months	8
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	0
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	0
Number of Available-for-sale Securities In Continuous Loss Position For 12 months or Greater	0
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	338,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	8,000
Number of Available-for-sale Securities In Continuous Loss Position Aggregate	8
Equity Securities [Member]
Unrealized Gain (Loss) on Investments [Abstract]
Available-for-sale Equity Securities, Amortized Cost Basis	48,133,000		45,883,000
Available-for-sale Securities, Gross Unrealized Gains	2,045,000		1,798,000
Available-for-sale Securities, Gross Unrealized Losses	333,000		422,000
Available-for-sale Securities, Fair Value	49,845,000		47,259,000
Unrealized Continuous Losses on Investments [Abstract]
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	28,156,000		34,675,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	329,000		422,000
Number of Available-for-sale Securities In Continuous Loss Position Less Than 12 Months	12		8
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	13,000		0
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses	4,000		0
Number of Available-for-sale Securities In Continuous Loss Position For 12 months or Greater	1		0
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	28,169,000		34,675,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	333,000		422,000
Number of Available-for-sale Securities In Continuous Loss Position Aggregate	13		8
Available-for-sale Securities, Gross Realized Gain (Loss) [Abstract]
Available-for-sale Securities, Gross Realized Gains	0	0
Available-for-sale Securities, Gross Realized Losses	$ 0	$ 0
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Schedule of Fixed Maturities [Abstract]
Percent of residential mortgage backed to securities	89.50%

XML

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2014

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]

The following tables set forth our assets and liabilities that are measured at fair value on a recurring basis as of the dates indicated.

	March 31, 2014
Available-for-sale investments	Level 1		Level 2	Level 3	Total Fair Value
	(In thousands)
Financial assets:
Fixed maturities:
U.S. Treasury and U.S. Government-sponsored enterprises	$	12,640	44,764	—	57,404
States and political subdivisions	—		359,920	—	359,920
Corporate	—		223,183	—	223,183
Commercial mortgage-backed	—		152	290	442
Residential mortgage-backed	—		3,679	—	3,679
Foreign governments	—		131	—	131
Total fixed maturities	12,640		631,829	290	644,759
Equity securities:
Stock mutual funds	12,200		—	—	12,200
Bond mutual funds	34,791		—	—	34,791
Common stock	813		—	—	813
Preferred stock	2,041		—	—	2,041
Total equity securities	49,845		—	—	49,845
Total financial assets	$	62,485	631,829	290	694,604

	December 31, 2013
Available-for-sale investments	Level 1		Level 2	Level 3	Total Fair Value
	(In thousands)
Financial assets:
Fixed maturities:
U.S. Treasury and U.S. Government-sponsored enterprises	$	12,463	54,568	—	67,031
States and political subdivisions	—		336,466	—	336,466
Corporate	—		197,561	—	197,561
Commercial mortgage-backed	—		—	309	309
Residential mortgage-backed	—		3,762	—	3,762
Foreign governments	—		127	—	127
Total fixed maturities	12,463		592,484	309	605,256
Equity securities:
Stock mutual funds	11,969		—	—	11,969
Bond mutual funds	34,663		—	—	34,663
Common stock	12		—	—	12
Preferred stock	615		—	—	615
Total equity securities	47,259		—	—	47,259
Total financial assets	$	59,722	592,484	309	652,515

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]

The following table presents additional information about fixed maturity securities measured at fair value on a recurring basis that are classified as Level 3 assets and for which we have utilized significant unobservable inputs to determine fair value.

	March 31, 2014			December 31, 2013
	(In thousands)
Balance at beginning of period	$	309		387
Total realized and unrealized gains (losses)
Included in net income	—			—
Included in other comprehensive income	—			(7	)
Principal paydowns	(19		)	(71	)
Transfer in and (out) of Level 3	—			—
Balance at end of period	$	290		309

Fair Value, by Balance Sheet Grouping [Table Text Block]

The carrying amount and fair value for the financial assets and liabilities on the consolidated balance sheets not otherwise disclosed for the periods indicated are as follows:

	March 31, 2014			December 31, 2013
	Carrying Value		Fair Value	Carrying Value	Fair Value
	(In thousands)
Financial assets:
Fixed maturities, held-to-maturity	$	223,586	225,087	227,696	223,533
Mortgage loans	659		684	671	695
Policy loans	50,288		50,288	48,868	48,868
Cash and cash equivalents	52,307		52,307	54,593	54,593
Financial liabilities:
Annuity - investment contracts	39,650		43,086	39,469	44,960

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Financial Statements (Policies)

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation and Consolidation [Policy Text Block]

Basis of Presentation and Consolidation

The accompanying consolidated financial statements of Citizens, Inc. and its wholly-owned subsidiaries have been prepared in conformity with U.S. generally accepted accounting principles ("U.S. GAAP").

The consolidated financial statements include the accounts and operations of Citizens, Inc. ("Citizens"), a Colorado corporation, and its wholly-owned subsidiaries, CICA Life Insurance Company of America ("CICA"), Security Plan Life Insurance Company ("SPLIC"), Security Plan Fire Insurance Company ("SPFIC"), Citizens National Life Insurance Company ("CNLIC"), Magnolia Guaranty Life Insurance Company ("MGLIC"), Computing Technology, Inc. ("CTI") and Insurance Investors, Inc. ("III").  Citizens and its wholly-owned subsidiaries are collectively referred to as "the Company," "we," "us" or "our."

The consolidated statements of financial position for March 31, 2014, and the consolidated statements of comprehensive income and cash flows for the three-month periods ended March 31, 2014 and 2013, have been prepared by the Company without audit.  In the opinion of management, all adjustments to present fairly the financial position, results of operations, and changes in cash flows at March 31, 2014 and for comparative periods have been made.  The consolidated financial statements have been prepared in accordance with U.S. GAAP accounting principles for interim financial information and with the instructions to Form 10-Q adopted by the Securities and Exchange Commission (“SEC”).  Accordingly, the financial statements do not include all of the information and footnotes required for complete financial statements and should be read in conjunction with the Company’s consolidated financial statements, and notes thereto, for the year ended December 31, 2013.  Operating results for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year or any future period.

We provide primarily life insurance and a small amount of health insurance policies through our insurance subsidiaries:  CICA, SPLIC, MGLIC and CNLIC.  CICA and CNLIC issue ordinary whole-life policies, credit life and disability, burial insurance, pre-need policies, and accident and health related policies, throughout the Midwest and southern United States.  CICA also issues ordinary whole-life policies to non-U.S. residents.  SPLIC offers final expense and home service life insurance in Louisiana, Arkansas and Mississippi and SPFIC, a wholly-owned subsidiary of SPLIC, writes a limited amount of property insurance in Louisiana. MGLIC provides industrial life policies through independent funeral homes in Mississippi.

CTI provides data processing systems and services, as well as furniture and equipment, to the Company.  III provides aviation transportation to the Company.

In accordance with our purchase agreement dated October 7, 2013, we finalized the MGLIC stock acquisition on March 7, 2014 for approximately $5.2 million in cash consideration. The assets recorded as of March 31, 2014 were $11.9 million, liabilities of $6.6 million and stockholders equity of $5.3 million. We believe the goodwill will be minimal relative to this company purchase. We are continuing to finalize the actuarial estimates and intangibles which may result in changes from the amounts reported in this quarterly report on Form 10-Q. This entity will be reported as part of our home service segment business and is a wholly owned subsidiary of SPLIC.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

The most significant estimates include those used in the evaluation of other-than-temporary impairments on debt and equity securities and valuation allowances on investments, actuarially determined assets and liabilities and assumptions, goodwill impairment, valuation allowance on deferred tax assets, and contingencies relating to litigation and regulatory matters.  Certain of these estimates are particularly sensitive to market conditions, and deterioration and/or volatility in the worldwide debt or equity markets could have a material impact on the Consolidated Financial Statements.

Reclassification, Policy [Policy Text Block]

Reclassification

Reclassifications have been made in the current year related to certain prior year reported amounts to provide consistent presentation. No individual amounts were material.

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Income Taxes

3 Months Ended

Mar. 31, 2014

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The effective tax rate was 29.2% and 22.7% for the first quarter of 2014 and 2013, respectively.   In periods where our effective tax rate is lower than the statutory tax rate of 35%, the difference is primarily due to tax-exempt state and local bonds. The effective tax rate is higher in the current year compared to 2013 primarily due to higher book income in the current period compared to the prior period but approximately the same amount of tax-exempt income in both periods.

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Related Party Transactions

3 Months Ended

Mar. 31, 2014

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

The Company has various routine related party transactions in conjunction with our holding company structure, such as a management service agreement related to costs incurred, a tax sharing agreement between entities, and inter-company dividends and capital contributions.  There were no changes related to these relationships during the three months ended March 31, 2014.  See our Annual Report on Form 10-K as of December 31, 2013 for a comprehensive discussion of related party transactions.

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Segment Information (Tables)

3 Months Ended

Mar. 31, 2014

Segment Reporting Information [Line Items]

Schedule of Segment Reporting Information, by Segment [Table Text Block]

	Three Months Ended
	March 31, 2014
	Life Insurance			Home Service Insurance		Other Non-Insurance Enterprises		Consolidated
	(In thousands)
Revenues:
Premiums	$	31,811		11,202		—		43,013
Net investment income	6,283			3,287		336		9,906
Realized investment gains (losses), net	(64		)	8		—		(56	)
Other income	143			1		25		169
Total revenue	38,173			14,498		361		53,032
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders	10,815			5,642		—		16,457
Increase in future policy benefit reserves	16,976			722		—		17,698
Policyholders' dividends	2,086			16		—		2,102
Total insurance benefits paid or provided	29,877			6,380		—		36,257
Commissions	6,238			3,672		—		9,910
Other general expenses	2,840			3,169		493		6,502
Capitalization of deferred policy acquisition costs	(5,659		)	(1,409	)	—		(7,068	)
Amortization of deferred policy acquisition costs	4,407			802		—		5,209
Amortization of cost of customer relationships acquired	171			360		—		531
Total benefits and expenses	37,874			12,974		493		51,341
Income (loss) before income tax expense	$	299		1,524		(132	)	1,691

	Three Months Ended
	March 31, 2013
	Life Insurance			Home Service Insurance		Other Non-Insurance Enterprises		Consolidated
	(In thousands)
Revenues:
Premiums	$	30,117		10,823		—		40,940
Net investment income	4,904			3,180		305		8,389
Realized investment gains, net	—			30		1		31
Other income	63			90		33		186
Total revenue	35,084			14,123		339		49,546
Benefits and expenses:
Insurance benefits paid or provided:
Claims and surrenders	9,338			5,468		—		14,806
Increase in future policy benefit reserves	16,042			917		—		16,959
Policyholders' dividends	2,059			15		—		2,074
Total insurance benefits paid or provided	27,439			6,400		—		33,839
Commissions	5,579			3,479		—		9,058
Other general expenses	2,852			3,266		581		6,699
Capitalization of deferred policy acquisition costs	(5,086		)	(1,276	)	—		(6,362	)
Amortization of deferred policy acquisition costs	3,985			641		—		4,626
Amortization of cost of customer relationships acquired	167			411		—		578
Total benefits and expenses	34,936			12,921		581		48,438
Income (loss) before income tax expense	$	148		1,202		(242	)	1,108

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Segment Information (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Segment Reporting Information [Line Items]
Number of reportable segments	3
Segment Reporting, Measurement Differences Between Segment and Consolidated Profit (Loss)	The Company has no reportable differences between segments and consolidated operations.
Premiums	$ 43,013	$ 40,940
Net investment income	9,906	8,389
Realized investment gains (losses), net	(56)	31
Other income	169	186
Total revenue	53,032	49,546
Claims and surrenders	16,457	14,806
Increase in future policy benefit reserves	17,698	16,959
Policyholders' dividends	2,102	2,074
Total insurance benefits paid or provided	36,257	33,839
Commissions	9,910	9,058
Other general expenses	6,502	6,699
Capitalization of deferred policy acquisition costs	(7,068)	(6,362)
Amortization of deferred policy acquisition costs	5,209	4,626
Amortization of cost of customer relationships acquired	531	578
Total benefits and expenses	51,341	48,438
Income (loss) before income tax expense	1,691	1,108
Life Insurance Segment [Member]
Segment Reporting Information [Line Items]
Premiums	31,811	30,117
Net investment income	6,283	4,904
Realized investment gains (losses), net	(64)	0
Other income	143	63
Total revenue	38,173	35,084
Claims and surrenders	10,815	9,338
Increase in future policy benefit reserves	16,976	16,042
Policyholders' dividends	2,086	2,059
Total insurance benefits paid or provided	29,877	27,439
Commissions	6,238	5,579
Other general expenses	2,840	2,852
Capitalization of deferred policy acquisition costs	(5,659)	(5,086)
Amortization of deferred policy acquisition costs	4,407	3,985
Amortization of cost of customer relationships acquired	171	167
Total benefits and expenses	37,874	34,936
Income (loss) before income tax expense	299	148
Home Service Insurance Segment [Member]
Segment Reporting Information [Line Items]
Premiums	11,202	10,823
Net investment income	3,287	3,180
Realized investment gains (losses), net	8	30
Other income	1	90
Total revenue	14,498	14,123
Claims and surrenders	5,642	5,468
Increase in future policy benefit reserves	722	917
Policyholders' dividends	16	15
Total insurance benefits paid or provided	6,380	6,400
Commissions	3,672	3,479
Other general expenses	3,169	3,266
Capitalization of deferred policy acquisition costs	(1,409)	(1,276)
Amortization of deferred policy acquisition costs	802	641
Amortization of cost of customer relationships acquired	360	411
Total benefits and expenses	12,974	12,921
Income (loss) before income tax expense	1,524	1,202
Other Non-Insurance Enterprise Segment [Member]
Segment Reporting Information [Line Items]
Premiums	0	0
Net investment income	336	305
Realized investment gains (losses), net	0	1
Other income	25	33
Total revenue	361	339
Claims and surrenders	0	0
Increase in future policy benefit reserves	0	0
Policyholders' dividends	0	0
Total insurance benefits paid or provided	0	0
Commissions	0	0
Other general expenses	493	581
Capitalization of deferred policy acquisition costs	0	0
Amortization of deferred policy acquisition costs	0	0
Amortization of cost of customer relationships acquired	0	0
Total benefits and expenses	493	581
Income (loss) before income tax expense	$ (132)	$ (242)

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Fair Value Measurements Financial Instruments not Carried at Fair Value (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2012
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fixed maturities held-to-maturity	$ 225,087	$ 223,533
Mortgage loans	659	671
Policy loans	50,288	48,868
Cash and cash equivalents, at carrying value	52,307	54,593	42,608	56,299
Liability for future policy benefits individual and group annuities	55,833	55,485
Mortgage Loans on Real Estate, Interest Rate	6.40%	6.40%
Mortgage loan maturity lower end range	1 year	1 year
Mortgage loan maturity higher end range	30 years	30 years
Mortgage loans interest rate used to estimate fair value	6.25%
Insurance policy loans interest rate	7.70%	7.70%
Fair value minimum interest rate of investment contract	0.24%
Fair value maximum rate of investment contract	4.03%
Carrying (Reported) Amount, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fixed maturities held-to-maturity	223,586	227,696
Mortgage loans	659	671
Policy loans	50,288	48,868
Cash and cash equivalents, at carrying value	52,307	54,593
Liability for future policy benefits individual and group annuities	39,650	39,469
Estimate of Fair Value, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fixed maturities held-to-maturity	225,087	223,533
Mortgage loans	684	695
Policy loans	50,288	48,868
Cash and cash equivalents, fair value disclosure	52,307	54,593
Liability for future policy benefits individual and group annuities	$ 43,086	$ 44,960

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Consolidated Statements of Cash Flows (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Cash flows from operating activities:
Net income	$ 1,197	$ 856
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Realized gains (losses) on sale of investments and other assets	56	(31)
Net deferred policy acquisition costs	(1,859)	(1,736)
Amortization of cost of customer relationships acquired	531	578
Depreciation	323	320
Amortization of premiums and discounts on investments	2,230	2,297
Deferred federal income tax benefit	(1,023)	(1,148)
Change in:
Accrued investment income	(471)	(608)
Reinsurance recoverable	(220)	2,822
Due premiums	822	296
Future policy benefit reserves	17,697	14,504
Other policyholders' liabilities	2,053	1,345
Federal income tax receivable	1,496	1,400
Commissions payable and other liabilities	(1,030)	(1,408)
Other, net	(1,293)	(1,410)
Net cash provided by operating activities	20,509	18,077
Cash flows from investing activities:
Sale of fixed maturities, available-for-sale	0	58
Maturities and calls of fixed maturities, available-for-sale	16,900	15,851
Maturities and calls of fixed maturities, held-to-maturity	9,292	18,465
Purchase of fixed maturities, available-for-sale	(36,161)	(64,046)
Purchase of fixed maturities, held-to-maturity	(6,347)	0
Calls of equity securities, available-for-sale	100	200
Principal payments on mortgage loans	12	133
Increase in policy loans, net	(1,420)	(1,879)
Sale of other long-term investments	1	1
Purchase of other long-term investments	0	(42)
Purchase of property and equipment	(283)	(181)
Purchase of short-term investments	0	(531)
Net cash used in acquisition	(4,810)	0
Net cash provided by (used in) investing activities	(22,716)	(31,971)
Cash flows from financing activities:
Annuity deposits	1,489	1,242
Annuity withdrawals	(1,568)	(1,039)
Net cash provided by financing activities	(79)	203
Net increase (decrease) in cash and cash equivalents	(2,286)	(13,691)
Cash and cash equivalents at beginning of year	54,593	56,299
Cash and cash equivalents at end of period	52,307	42,608
Supplemental Disclosures of Operation Activities
Cash paid (received) during the period for income taxes, net	$ 0	$ 0

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Investments

3 Months Ended

Mar. 31, 2014

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

Investments

The Company invests primarily in fixed maturity securities, which totaled 84.3% of total investments and cash and cash equivalents at March 31, 2014.

	March 31, 2014				December 31, 2013
	Carrying Value		% of Total Carrying Value		Carrying Value		% of Total Carrying Value
	(In thousands)				(In thousands)
Fixed maturity securities	$	868,345	84.3	%	$	832,952	83.9	%
Equity securities	49,845		4.8	%	47,259		4.8	%
Mortgage loans	659		0.1	%	671		0.1	%
Policy loans	50,288		4.9	%	48,868		4.8	%
Real estate and other long-term investments	8,447		0.8	%	8,485		0.9	%
Cash and cash equivalents	52,307		5.1	%	54,593		5.5	%
Total cash, cash equivalents and investments	$	1,029,891	100.0	%	$	992,828	100.0	%

The following tables represent the cost, gross unrealized gains and losses and fair value for fixed maturities and equity securities as of the periods indicated.

	March 31, 2014
	Cost or Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
	(In thousands)
Fixed maturities:
Available-for-sale:
U.S. Treasury securities	$	10,101	2,539	—	12,640
U.S. Government-sponsored enterprises	43,076		1,718	30	44,764
States and political subdivisions	355,633		10,529	6,242	359,920
Foreign governments	104		27	—	131
Corporate	208,740		14,883	440	223,183
Commercial mortgage-backed	432		10	—	442
Residential mortgage-backed	3,394		287	2	3,679
Total available-for-sale securities	621,480		29,993	6,714	644,759
Held-to-maturity securities:
U.S. Government-sponsored enterprises	5,846		249	—	6,095
States and political subdivisions	183,868		3,975	3,400	184,443
Corporate	33,872		853	176	34,549
Total held-to-maturity securities	223,586		5,077	3,576	225,087
Total fixed maturities	$	845,066	35,070	10,290	869,846
Equity securities:
Stock mutual funds	$	10,463	1,737	—	12,200
Bond mutual funds	35,080		29	318	34,791
Common stock	810		10	7	813
Preferred stock	1,780		269	8	2,041
Total equity securities	$	48,133	2,045	333	49,845

	December 31, 2013
	Cost or Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
	(In thousands)
Fixed maturities:
Available-for-sale securities:
U.S. Treasury securities	$	10,115	2,348	—	12,463
U.S. Government-sponsored enterprises	53,587		1,209	228	54,568
States and political subdivisions	341,673		6,242	11,449	336,466
Foreign governments	104		23	—	127
Corporate	186,671		12,289	1,399	197,561
Commercial mortgage-backed	300		9	—	309
Residential mortgage-backed	3,494		270	2	3,762
Total available-for-sale securities	595,944		22,390	13,078	605,256
Held-to-maturity securities:
U.S. Government-sponsored enterprises	8,877		197	3	9,071
States and political subdivisions	181,246		1,633	6,412	176,467
Corporate	37,573		771	349	37,995
Total held-to-maturity securities	227,696		2,601	6,764	223,533
Total fixed maturity securities	$	823,640	24,991	19,842	828,789
Equity securities:
Stock mutual funds	$	10,463	1,506	—	11,969
Bond mutual funds	35,080		—	417	34,663
Common stock	17		—	5	12
Preferred stock	323		292	—	615
Total equity securities	$	45,883	1,798	422	47,259

At March 31, 2014, the Company had $3.8 million of mortgage-backed security holdings based on amortized cost, of which $3.4 million, or 89.5%, were residential U.S. Government-sponsored issues.  Mortgage-backed securities are also referred to as securities not due at a single maturity date throughout this report.  The majority of the Company's equity securities are diversified stock and bond mutual funds.

Valuation of Investments in Fixed Maturity and Equity Securities

Held-to-maturity securities are reported in the financial statements at amortized cost and available-for-sale securities are reported at fair value.

The Company monitors all debt and equity securities on an on-going basis relative to changes in credit ratings, market prices, earnings trends and financial performance, in addition to specific region or industry reviews.  The assessment of whether impairments have occurred is based on a case-by-case evaluation of underlying reasons for the decline in fair value.  The Company determines other-than-temporary impairment by reviewing relevant evidence related to the specific security issuer as well as the Company's intent to sell the security, or if it is more likely than not that the Company would be required to sell a security before recovery of its amortized cost.

When an other-than-temporary impairment has occurred, the amount of the other-than-temporary impairment recognized in earnings depends on whether the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis.  If the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis, the other-than-temporary impairment is recognized in earnings equal to the entire difference between the investment's cost and its fair value at the balance sheet date.  If the Company does not intend to sell the security and it is more likely than not that the Company will not be required to sell the security before recovery of its amortized cost basis, the other-than-temporary impairment is separated into the following: (a) the amount representing the credit loss; and (b) the amount related to all other factors.  The amount of the total other-than-temporary impairment related to the credit loss is recognized in earnings.  The amount of the total other-than-temporary impairment related to other factors is recognized in other comprehensive income, net of applicable taxes.  The previous amortized cost basis less the other-than-temporary impairment recognized in earnings becomes the new amortized cost basis of the investment.  The new amortized cost basis is not adjusted for subsequent recoveries in fair value.

The Company evaluates whether a credit impairment exists for debt securities by considering primarily the following factors: (a) changes in the financial condition of the security's underlying collateral; (b) whether the issuer is current on contractually obligated interest and principal payments; (c) changes in the financial condition, credit rating and near-term prospects of the issuer; (d) the length of time to which the fair value has been less than the amortized cost of the security; and (e) the payment structure of the security.  The Company's best estimate of expected future cash flows used to determine the credit loss amount is a quantitative and qualitative process.  Quantitative review includes information received from third party sources such as financial statements, pricing and rating changes, liquidity and other statistical information.  Qualitative factors include judgments related to business strategies, economic impacts on the issuer and overall judgment related to estimates and industry factors.  The Company's best estimate of future cash flows involves assumptions including, but not limited to, various performance indicators, such as historical and projected default and recovery rates, credit ratings, and current delinquency rates.  These assumptions require the use of significant management judgment and include the probability of issuer default and estimates regarding timing and amount of expected recoveries, which may include estimating the underlying collateral value.  In addition, projections of expected future debt security cash flows may change based upon new information regarding the performance of the issuer.

The primary factors considered in evaluating whether an impairment exists for an equity security include, but are not limited to: (a) the length of time and the extent to which the fair value has been less than the cost of the security; (b) changes in the financial condition, credit rating and near-term prospects of the issuer; (c) whether the issuer is current on contractually obligated payments; and (d) the intent and ability of the Company to retain the investment for a period of time sufficient to allow for recovery.

The Company did not recognize any other-than-temporary impairments ("OTTI") during the three months ended March 31, 2014 and 2013.

The following tables present the fair values and gross unrealized losses of fixed maturities and equity securities that have remained in a continuous unrealized loss position for the periods indicated.

	March 31, 2014
	Less than 12 months				Greater than 12 months			Total
	Fair Value		Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities
	(In thousands, except for # of securities)
Fixed maturities:
Available-for-sale securities:
U.S. Government-sponsored enterprises	$	1,285	9	6	830	21	1	2,115	30	7
States and political subdivisions	128,340		5,149	137	21,095	1,093	23	149,435	6,242	160
Corporate	38,641		286	34	2,623	154	2	41,264	440	36
Residential mortgage-backed	61		1	5	40	1	1	101	2	6
Total available-for-sale securities	168,327		5,445	182	24,588	1,269	27	192,915	6,714	209
Held-to-maturity securities:
States and political subdivisions	74,114		3,031	87	11,710	369	18	85,824	3,400	105
Corporate	5,395		176	4	—	—	—	5,395	176	4
Total held-to-maturity securities	79,509		3,207	91	11,710	369	18	91,219	3,576	109
Total fixed maturities	$	247,836	8,652	273	36,298	1,638	45	284,134	10,290	318
Equity securities:
Bond mutual funds	$	27,682	318	3	—	—	—	27,682	318	3
Common stocks	136		3	1	13	4	1	149	7	2
Preferred stocks	338		8	8	—	—	—	338	8	8
Total equities	$	28,156	329	12	13	4	1	28,169	333	13

As of March 31, 2014, the Company had 27 available-for-sale securities and 18 held-to-maturity securities that were in an unrealized loss position for greater than 12 months. We reported 1 common stock holding in an unrealized loss position as of March 31, 2014.

	December 31, 2013
	Less than 12 months				Greater than 12 months			Total
	Fair Value		Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities
	(In thousands, except for # of securities)
Fixed maturities:
Available-for-sale securities:
U.S. Government-sponsored enterprises	$	14,032	228	12	—	—	—	14,032	228	12
States and political subdivisions	183,280		9,872	203	15,673	1,577	16	198,953	11,449	219
Corporate	35,789		1,048	25	2,426	351	2	38,215	1,399	27
Residential mortgage-backed	57		1	3	42	1	1	99	2	4
Total available-for-sale securities	233,158		11,149	243	18,141	1,929	19	251,299	13,078	262
Held-to-maturity securities:
U.S. Government-sponsored enterprises	2,997		3	1	—	—	—	2,997	3	1
States and political subdivisions	100,153		5,236	118	14,797	1,176	17	114,950	6,412	135
Corporate	5,225		349	4	—	—	—	5,225	349	4
Total held-to-maturity securities	108,375		5,588	123	14,797	1,176	17	123,172	6,764	140
Total fixed maturities	$	341,533	16,737	366	32,938	3,105	36	374,471	19,842	402
Equity securities:
Bond mutual funds	$	34,663	417	7	—	—	—	34,663	417	7
Common stock	12		5	1	—	—	—	12	5	1
Total equities	$	34,675	422	8	—	—	—	34,675	422	8

We have reviewed these securities for the periods ended March 31, 2014 and December 31, 2013 and determined that no other-than-temporary impairment exists based on our evaluation of the credit worthiness of the issuers and the fact that we do not intend to sell the investments nor is it likely that we will be required to sell the securities before recovery of their amortized cost bases which may be maturity.  We continue to monitor all securities on an on-going basis, and future information may become available which could result in impairments being recorded.

The amortized cost and fair value of fixed maturity securities at March 31, 2014 by contractual maturity are shown in the table below.  Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date have been reflected based upon final stated maturity.

	March 31, 2014
	Amortized Cost		Fair Value
	(In thousands)
Available-for-sale securities:
Due in one year or less	$	15,507	15,818
Due after one year through five years	117,719		125,050
Due after five years through ten years	104,920		108,876
Due after ten years	383,334		395,015
Total available-for-sale securities	621,480		644,759
Held-to-maturity securities:
Due in one year or less	10,453		10,515
Due after one year through five years	31,897		32,581
Due after five years through ten years	43,214		44,633
Due after ten years	138,022		137,358
Total held-to-maturity securities	223,586		225,087
Total fixed maturities	$	845,066	869,846

The Company uses the specific identification method of the individual security to determine the cost basis used in the calculation of realized gains and losses related to security sales.  Proceeds and gross realized gains from sales of securities for the three months ended March 31, 2014 and 2013 are summarized as follows.

		Fixed Maturities, Available-for-sale			Equity Securities
		Three Months Ended			Three Months Ended
		March 31,			March 31,
		2014		2013	2014	2013
	(In thousands)
Proceeds		$	—	58	—	—
Gross realized gains		$	—	1	—	—
Gross realized losses		$	—	—	—	—

There were no securities sold at a loss during the three month period ended March 31, 2014 or 2013. There were no securities sold from the held-to-maturity portfolio for the three months ended March 31, 2014 or 2013.

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Commitments and Contingencies (Details)	0 Months Ended
	Dec. 09, 2009	Aug. 06, 1999
Commitments and Contingencies Disclosure [Abstract]
Filing date for lawsuit		Aug. 06, 1999
Number of Non U.S. Trusts		2
Date of Court Ruling	Dec. 09, 2009

XML

Financial Statements (Details) (MGLIC [Member], USD $)	0 Months Ended
	Mar. 07, 2014	Mar. 31, 2014
MGLIC [Member]
Business Acquisition [Line Items]
Business Acquisition, Date of Acquisition Agreement	Mar. 07, 2014
Payments to Acquire Businesses, Gross	$ 5,200,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets		11,900,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities		6,600,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net		$ 5,300,000