8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 6, 2009

CITIZENS, INC.

(Exact name of registrant as specified in its charter)

COLORADO	0-16509	84-0755371
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

400 East Anderson Lane Austin, Texas	78752
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (512) 837-7100

Not Applicable

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

SECTION 8 — OTHER EVENTS

Item 8.01 Other Events.

On August 6, 2009, Citizens, Inc. (“Citizens”) issued a news release (the “Release”) reporting, among other things, results for its second quarter 2009 earnings. A copy of the Release is included as Exhibit 99.8 to this Current Report on Form 8-K and incorporated herein by reference. Citizens also announced that it would hold a conference call to discuss its financial results at 10:00 a.m. Central Standard Time on Friday August 7, 2009.

The information in this report is being furnished, not filed, for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and pursuant to Item 2.02 of Form 8-K will not be incorporated by reference into any filing under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.

Item 9.01 Financial Statements and Exhibits

(d)	Exhibits:
99.8	News Release issued by Citizens, Inc. on August 6, 2009.

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SIGNATURE

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 hereunto duly authorized.

CITIZENS, INC
By:	/s/ Rick D. Riley
	Rick D. Riley, Vice Chairman and
	President

Date: August 6, 2009

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EXHIBIT INDEX

Exhibit No.	Description
99.8	News Release issued by Citizens, Inc. on August 6, 2009

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EX-99.8

Exhibit 99.8

For further information contact:
Randall H. Riley
Vice President, Investor Relations
PR@citizensinc.com

FOR IMMEDIATE RELEASE

CITIZENS, INC. REPORTS SECOND QUARTER RESULTS

Austin, Texas – August 6, 2009 – Citizens, Inc. (NYSE: CIA) reported net income of $7.1 million or $0.10 basic earnings per share of Class A common stock and $0.04 diluted earnings per share of Class A common stock for the six months ended June 30, 2009 compared to net income of $5.7 million or $0.11 per basic and diluted earnings per share of Class A common stock for the same period in 2008. For the three months ended June 30, 2009, the Company earned $2.7 million or $0.03 basic and diluted earnings per share of Class A common stock compared to $3.0 million or $0.06 basic and diluted earnings per share for the same period in 2008. The increase in net income is due primarily to an increase in life insurance premiums, realized gains on investments and the decrease in the fair value of the Company’s warrants. Total revenues increased to $90.1 million in the first half of 2009 compared to the same period of 2008 when revenues were $83.2 million, and increased to $45.4 million for the three months ended June 30, 2009 from $43.3 million for the same period in 2008.

Life Insurance: Total revenues from our Life Insurance segment increased to $58.3 million for the six months ended June 30, 2009 compared to $56.3 million for the six months ended June 30, 2008, and increased slightly to $29.9 million for the quarter ended June 30, 2009 from $29.6 million for the quarter ended June 30, 2008. Premium income was $49.8 million for the first half of 2009, a 3.8% increase over the same period of 2008 when premiums were $48.0 million. Premiums in the second quarter of 2009 increased to $25.7 million over $25.4 million in the second quarter of 2008. The increase resulted primarily from premium income relating to the acquisition of Integrity Capital Corporation. Net investment income decreased to $8.0 million from $8.2 million in the second quarter of 2009 as a result of significant call activity in the Company’s bond portfolio. Net investment income for the three months decreased from $4.1 million in 2008 to $3.7 million in 2009. Claims and surrenders increased to $20.2 million in first half of 2009 from $17.8 million for the same period of 2008 and increased to $10.5 million from $9.2 million for the three months ended June 30, 2009 and 2008, respectively. These amounts fluctuate from period to period but were within the Company’s normal range.

Home Service: Total revenues from our Home Service segment increased to $28.2 million compared to $26.1 million for the six months ended June 30, 2009 and 2008, and also increased in the three months ended June 30, 2009 to $14.4 million from $12.9 million during the same period in 2008.

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Premium income increased primarily due to the acquisition of Ozark National Life Insurance Company (ONLIC). Net investment income decreased 7.5% to $2.9 million for the three months ended June 30, 2009 compared to $3.1 million for the same period in 2008 due to the decline in interest rates on new securities purchased and an increase in call activity in the bond portfolio. However, net investment income increased to $6.3 million for the six months ended June 30, 2009 from $6.2 million in 2008, which included $240,000 from a lawsuit settlement related to an Enron bond recorded to investment income and stock dividend income of $223,000 related to the ONLIC portfolio in 2009. Claims and surrenders decreased to $4.4 million from $5.5 million for the three months ended June 30, 2009 compared to 2008, resulting from a decrease in death benefits and casualty claims.

Assets increased to $890.5 million at June 30, 2009, compared to $832.3 million at December 31, 2008. Stockholders’ equity also increased 10.8% from $171.5 million at December 31, 2008 to $190.1 million at June 30, 2009.

Citizens, Inc. will host a conference call to discuss its 2009 second quarter operating results at 10:00 a.m. Central Daylight Time on Friday, August 7, 2009, hosted by Rick D. Riley, Vice Chairman and President, Kay Osbourn, Chief Financial Officer and other members of the Citizens, Inc. management team. To participate, please dial (888) 742-8686 and when prompted enter confirmation code #8442219. It is recommended you dial in 3-5 minutes before the call is scheduled to begin.

About Citizens, Inc.

Citizens, Inc. is a financial services company listed on the New York Stock Exchange under the symbol CIA. The Company has strategic goals to achieve $1.0 billion in assets, $250 million in revenues and $10 billion of life insurance in force by 2010, by selling U.S. dollar denominated whole life cash value insurance policies worldwide, coupled with acquisitions of other U.S. life insurance companies. Citizens’ Class A common stock closed at $6.79 on August 6, 2009.

Additional information is available about the Company on its web site: www.citizensinc.com.

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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, 2008, 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.

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CITIZENS, INC.
COMPARATIVE CONSOLIDATED FINANCIAL HIGHLIGHTS
(In thousands, except per share amounts)

OPERATING STATEMENTS

	(Unaudited)						(Unaudited)
	Six Months Ended						Three Months Ended
	June 30,						June 30,
	2009			2008			2009			2008
Revenues
Premiums	$	70,342		$	67,874			36,115			35,204
Net investment income		14,320			14,944			6,578			7,480
Realized gains, net		1,821			16			1,520			—
Decrease (increase) in fair value of warrants		3,081			(191	)		976			312
Other income		523			564			240			285
Total revenues		90,087			83,207			45,429			43,281
Benefits and Expenses
Insurance benefits paid or provided:
Claims and surrenders		29,760			27,808			14,953			14,730
Increase in future policy benefit reserves		17,716			14,730			9,958			7,733
Policyholders’ dividends		2,915			2,954			1,453			1,577
Total insurance benefits paid or provided		50,391			45,492			26,364			24,040
Commissions		17,027			17,087			8,992			9,376
Other underwriting, acquisition and insurance expenses		15,117			13,931			7,808			7,020
Capitalization of deferred policy acquisition costs		(10,951	)		(11,164	)		(5,894	)		(6,309	)
Amortization of deferred policy acquisition costs		7,412			7,668			3,720			4,106
Amortization of cost of customer relationships acquired and other intangibles		1,684			1,479			818			715
Total benefits and expenses		80,680			74,493			41,808			38,948
Income before Federal income tax		9,407			8,714			3,621			4,333
Federal income tax expense		2,314			2,987			905			1,341
Net income	$	7,093		$	5,727			2,716			2,992
Net income applicable to common stock	$	4,745		$	4,716			1,546			2,493
Basic earnings per share of Class A common stock	$	0.10		$	0.11			0.03			0.06
Basic earnings per share of Class B common stock	$	0.05		$	0.05			0.02			0.03
Diluted earnings per share of Class A common stock	$	0.04		$	0.11			0.03			0.06
Diluted earnings per share of Class B common stock	$	0.02		$	0.05			0.02			0.03
Weighted average shares of Class A outstanding — basic and diluted		47,540			44,085			47,966			44,098
Book value per share	$	3.96		$	3.96		$	3.96		$	3.96

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BALANCE SHEETS

	(Unaudited)
	June 30,		December 31,
	2009		2008
Total assets	$	890,480	$	832,276
Total invested assets		591,617		569,252
Stockholders’ equity		190,064		171,541

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