Citizens, Inc. Reports Third Quarter three and nine months 2014 Results Investor Conference Call Scheduled for November 6, 2014, at 10:00 a.m.

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1 NEWS RELEASE FOR IMMEDIATE RELEASE Nvember 5, 2014 FOR FURTHER INFORMATION CONTACT: Kay Osburn Chief Financial Officer (512) Citizens, Inc. Reprts Third Quarter three and nine mnths 2014 Results Investr Cnference Call Scheduled fr Nvember 6, 2014, at 10:00 a.m. CST AUSTIN, TEXAS (Nvember 5, 2014) Citizens, Inc. (NYSE: CIA) reprted results tday fr the three and nine mnths ended September 30, Rick D. Riley, Vice Chairman and President, said, "We are reprting very slid results with an increase in premium sales revenue f 7.3% and 6.0% fr the three and nine mnths ended September 30, 2014 cmpared t the same perids in Net investment incme increased 8.5% and 11.6% fr the three and nine mnth perids ended September 30, 2014 cmpared t the crrespnding perids in The average yield n the cnslidated prtfli as f the nine mnths ended September 30, 2014 imprved t an annualized rate f 4.22% up frm 4.10% fr the same perid in 2013 as we cntinue t see increased yields frm the histrical lw rates f prir years." Riley added, "Claims and surrenders expense increased 3.4% and 4.6% fr the three and nine mnths ended in 2014 cmpared t 2013 as surrender benefits reprted in bth insurance segments increased in the current year cmpared t 2013 levels. The majrity f surrender activity cmes frm ur internatinal life segment and relates t plicies beynd their fifteenth year duratin where surrender charges n lnger apply. Death claims decreased 8.3% fr the three mnths and increased slightly fr the nine mnths ended September 30, 2014 as we experienced favrable claims develpment in the current quarter fr bth the life and hme service segments." Net incme fr the three and nine mnths ended September 30, 2014 increased 27% and 17%, respectively. Bk value per share f Class A cmmn stck was $5.33 at September 30, 2014." FOR THE PERIODS ENDED SEPTEMBER 30, Q Q (Unaudited, In thusands, except fr per share amunts) Premiums $ 46,923 43, , ,521 Net investment incme 10,384 9,570 30,373 27,224 Net realized investment gains (lsses) (222) 30 (351) 143 Ttal revenue 57,230 53, , ,770 Net incme applicable t cmmn stck 2,324 1,824 4,671 3,987 Net incme per diluted share f Class A cmmn stck Diluted weighted average shares f Class A cmmn stck 49,080 49,080 49,080 49,080 Operating incme $ 2,468 1,805 4,899 3,894 P.O. Bx Austin, Texas Phne: (512) Fax: (512) PR@citizensinc.cm Website:

2 "As previusly reprted, we anticipate Magnlia Guaranty Life Insurance Cmpany ("MGLIC") will accunt fr apprximately $0.3 millin f additinal net incme fr the full year f We cmpleted integratin f MGLIC int ur insurance administratin system during the third quarter f 2014 and we cntinue wrking t cnfrm its peratins t ur standards. MGLIC is included in ur hme service business segment as a whlly wned Security Plan Life Insurance Cmpany subsidiary." Recnciliatin f Net Incme t Operating Incme (a nn-gaap measure) FOR THE PERIODS ENDED SEPTEMBER 30, Q Q (Unaudited, In thusands) Net incme $ 2,324 1,824 4,671 3,987 Items excluded in the calculatin f perating incme: Net realized investment (gains) lsses 222 (30) 351 (143) Pre-tax effect f exclusins 222 (30) 351 (143) Tax effect at 35% (78) 11 (123) 50 Operating incme $ 2,468 1,805 4,899 3,894 Nn-GAAP Financial Measures - The table abve recnciles Net Incme t Operating Incme. Operating Incme is a "Nn-GAAP" financial measure that is widely used in ur industry t evaluate the perfrmance f underwriting peratins. Operating Incme excludes the after-tax net effects f Net Realized Investment Gains and Lsses. We believe it presents a useful view f the perfrmance f ur insurance peratins. While we believe disclsure f certain Nn-GAAP infrmatin is apprpriate, yu shuld nt cnsider this infrmatin withut als cnsidering the infrmatin we present in accrdance with GAAP. INSURANCE OPERATIONS Life Insurance Our Life Insurance segment primarily issues rdinary whle life insurance and endwments in U.S. Dllar-denminated amunts t freign residents in apprximately 30 cuntries thrugh independent marketing cnsultants, and dmestically thrugh independent marketing firms and cnsultants acrss the United States. Premiums Life insurance premium revenues increased fr the three and nine mnths f 2014, primarily frm higher internatinal renewal premiums, as we cntinue t experience strng endwment sales and persistency. First year premiums increased 21.4% fr the three mnths and 9.1% fr the nine mnths ended September 30, 2014 cmpared t the same perids in Renewal premiums are als up 5.5% and 5.8% fr the three and nine mnths cmpared t the prir year. The endwment t age sixty-five and the twenty-year endwment cntinue t be the preferred prducts internatinally. Venezuela, Clmbia and Taiwan which have been ur tp three prducing cuntries, all shwed premium grwth fr the nine mnths ended September 30, 2014 cmpared t the same perid in Benefits and expenses Future plicy benefit reserves increased as endwment prducts accumulate higher reserve balances n the frnt end when cmpared t whle life prducts. Cmmissin expense increased cmparatively as first year sales expanded and renewal premium remained strng. Death claims decreased fr the three mnths ended September 30, 2014 by 13.2% due t lwer reprted claims but were up slightly year t date in 2014 cmpared t Surrender expense was up19.8% and 9.0% fr the three and nine mnths ended September 30, 2014 cmpared t 2013 levels fr the same perid. Our verall surrenders have remained at a level ttaling apprximately 0.6% f in frce with a large prtin related t plicies that have passed the surrender charge perid, which is typically furteen years. Hme Service Our Hme Service Insurance segment prvides pre-need and final expense rdinary life insurance and annuities t middle and lwer incme individuals, primarily in Luisiana, Mississippi and Arkansas. Our plicies in this segment are sld and serviced thrugh funeral hmes and a hme service marketing distributin system utilizing emplyees and independent agents. 2

3 Premiums Hme service premiums increased 5.6% and 5.4% fr the three and nine mnths in 2014 cmpared t 2013 primarily due t the added premium assciated with the MGLIC acquisitin f $0.6 millin and $1.4 millin. We expect this acquisitin will benefit ur Hme Service segment thrugh enhanced marketing pprtunities in Mississippi. Benefits and expenses Claims and surrenders decreased by 7.1% fr the three mnths but remained relatively flat fr nine mnths in 2014 cmpared t 2013, due primarily t reprted death claims activity in bth current perids. In 2013, we experienced increased weather-related prperty claims, which was nt the case in 2014, therefre current prperty claims are lwer n a cmparative basis by 28.4% and 27.1% fr the three and nine mnths ended September 30, 2014 t This segment reprted increased amrtizatin f deferred acquisitin csts, as we experienced higher plicy lapses in the current year. Additinally, the inclusin f MGLIC results affected cmparability. The nn-insurance segment represents the administrative supprt entities t the insurance peratins whse revenues are primarily intercmpany and have been eliminated in cnslidatin under GAAP. INVESTMENTS Invested assets Ttal invested assets cntinued t increase frm year-end 2013 as new premium revenues were invested primarily in fixed maturity bnds and plicy lans rse. Fixed maturity securities represented 84.0% f invested assets and cash at September30, 2014, cmpared t 83.9% at year-end Equity security hldings increased t $55.6 millin at September 30, 2014 frm $47.3 millin at year-end 2013 with the increase primarily frm the MGLIC acquisitin and additinal purchases in mutual funds in the current quarter. The majrity f ur equity hldings are bnd mutual funds. Cash and cash equivalents represented 5.2% f ttal cash, cash equivalents and invested assets at September 30, 2014, dwn frm 5.5% at year-end 2013, reflecting the timing f calls f securities wned and f investment and reinvestment f new premium revenues and ther available funds. Investment incme Net investment incme increased 8.5% and 11.6% fr the three and nine mnths ended September 30, 2014 cmpared t the same perids in 2013, primarily due t an increase in verall yield n invested assets and frm verall asset grwth frm premium cllectins received and invested in fixed maturity bnds. In additin, ur plicy lan asset balance rse by 7.6% during the nine mnths in 2014, resulting in a plicy lan incme increase as a cmpnent f investment incme. Yield Average annualized yield was 4.22% fr the nine mnths ended in 2014 cmpared t 4.11% fr the full year f 2013 and 4.10% fr the nine mnths ended September 30, Duratin The average maturity f the fixed incme bnd prtfli was apprximately12 years with an estimated effective maturity f 7 years as f September 30, Realized investment gains (lsses) - During the three mnths ended September 30, 2014 the Cmpany recgnized ther -than-temprary impairments n tw shrt-term bnd mutual funds that we n lnger have the intent t hld. Fr the nine mnths ended we sld three bnd mutual fund issues ttaling $15.0 millin fr a net lss f $51,000. We reinvested these prceeds int mre attractive bnd mutual funds fr expected imprvement in yields. INVESTOR CONFERENCE CALL On Thursday, Nvember 6, 2014, Citizens will hst a cnference call t discuss perating results at 10:00 a.m. Central Standard Time. The cnference call will be hsted by Rick D. Riley, Vice Chairman and President, Kay Osburn, Chief Financial Officer, and ther members f the Cmpany s management team. T participate, please dial and ask t jin the Citizens, Inc. call ID We recmmend accessing the call three t five minutes befre the call is scheduled t begin. A 3

4 recrding f the cnference call will be available n Citizens' website at in the Investr Relatins sectin under SEC Filings & News Releases fllwing the call. ABOUT CITIZENS, INC. Citizens, Inc. is a financial services cmpany listed n the New Yrk Stck Exchange under the symbl CIA. The Cmpany utilizes a three-prnged strategy fr grwth based upn wrldwide sales f U.S. Dllar-denminated whle life cash value insurance plicies, life insurance prduct sales in the U.S. and the acquisitin f ther U.S. based life insurance cmpanies. SAFE HARBOR Infrmatin herein cntains frward-lking statements within the meaning f the Private Securities Litigatin Refrm Act f 1995, which can be identified by wrds such as may, will, expect, anticipate r cntinue r cmparable wrds. In additin, all statements ther than statements f histrical facts that address activities that the Cmpany expects r anticipates will r may ccur in the future are frwardlking statements. Readers are encuraged t read the SEC reprts f the Cmpany, particularly its Frm 10-K fr the fiscal year ended December 31, 2013, its quarterly reprts n Frm 10-Q and its current reprts n Frm 8-K, fr the meaningful cautinary language disclsing why actual results may vary materially frm thse anticipated by management. The Cmpany undertakes n duty r bligatin t update any frward-lking statements cntained in this release as a result f new infrmatin, future events r changes in the Cmpany s expectatins. The Cmpany als disclaims any duty t cmment upn r crrect infrmatin that may be cntained in reprts published by the investment cmmunity. 4

5 CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Cnslidated Statements f Cmprehensive Incme (In thusands, except per share amunts) Three Mnths Ended September 30, (Unaudited) Revenues: Premiums: Life insurance $ 45,234 42,091 Accident and health insurance Prperty insurance 1,295 1,276 Net investment incme 10,384 9,570 Realized investment gains (lsses), net (222) 30 Other incme Ttal revenues 57,230 53,616 Benefits and expenses: Insurance benefits paid r prvided: Claims and surrenders 17,326 16,763 Increase in future plicy benefit reserves 19,307 17,398 Plicyhlders' dividends 2,573 2,362 Ttal insurance benefits paid r prvided 39,206 36,523 Cmmissins 11,116 9,940 Other general expenses 6,029 6,163 Capitalizatin f deferred plicy acquisitin csts (8,126) (7,067) Amrtizatin f deferred plicy acquisitin csts 5,276 4,758 Amrtizatin f cst f custmer relatinships acquired Ttal benefits and expenses 53,954 50,998 Incme befre federal incme tax 3,276 2,618 Federal incme tax expense Net incme 2,324 1,824 Per Share Amunts: Basic earnings per share f Class A cmmn stck $ Basic earnings per share f Class B cmmn stck Diluted earnings per share f Class A cmmn stck Diluted earnings per share f Class B cmmn stck Other cmprehensive incme (lss): Unrealized gains (lsses) n available-fr-sale securities: Unrealized hlding lsses arising during perid (1,628) (4,128) Reclassificatin adjustment fr (gains) lsses included in net incme 227 (84) Unrealized gains (lsses) n available-fr-sale securities, net (1,401) (4,212) Incme tax benefit n unrealized lsses n available-fr-sale securities (490) (1,474) Other cmprehensive lss (911 ) (2,738 ) Cmprehensive incme (lss) $ 1,413 (914 ) 5

6 CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Cnslidated Statements f Cmprehensive Incme (In thusands, except per share amunts) Nine Mnths Ended September 30, (Unaudited) Revenues: Premiums: Life insurance $ 131, ,728 Accident and health insurance 1,135 1,135 Prperty insurance 3,832 3,658 Net investment incme 30,373 27,224 Realized investment gains (lsses), net (351) 143 Other incme Ttal revenues 166, ,770 Benefits and expenses: Insurance benefits paid r prvided: Claims and surrenders 50,451 48,229 Increase in future plicy benefit reserves 56,984 52,253 Plicyhlders' dividends 7,087 6,671 Ttal insurance benefits paid r prvided 114, ,153 Cmmissins 31,429 29,427 Other general expenses 19,979 20,204 Capitalizatin f deferred plicy acquisitin csts (22,617) (21,101) Amrtizatin f deferred plicy acquisitin csts 15,378 13,747 Amrtizatin f cst f custmer relatinships acquired 1,598 1,819 Ttal benefits and expenses 160, ,249 Incme befre federal incme tax 6,475 5,521 Federal incme tax expense 1,804 1,534 Net incme 4,671 3,987 Per Share Amunts: Basic earnings per share f Class A cmmn stck $ Basic earnings per share f Class B cmmn stck Diluted earnings per share f Class A cmmn stck Diluted earnings per share f Class B cmmn stck Other cmprehensive incme (lss): Unrealized gains (lsses) n available-fr-sale securities: Unrealized hlding gains (lsses) arising during perid 24,764 (29,576) Reclassificatin adjustment fr (gains) lsses included in net incme 332 (188) Unrealized gains (lsses) n available-fr-sale securities, net 25,096 (29,764) Incme tax expense (benefit) n unrealized gains (lsses) n available-fr-sale securities 8,804 (10,400) Other cmprehensive incme (lss) 16,292 (19,364 ) Cmprehensive incme (lss) $ 20,963 (15,377 ) 6

7 CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Cnslidated Statements f Financial Psitin (In thusands) September 30, December 31, (Unaudited) Assets: Investments: Fixed maturities available-fr-sale, at fair value $ 681, ,256 Fixed maturities held-t-maturity, at amrtized cst 230, ,696 Equity securities available-fr-sale, at fair value 55,643 47,259 Mrtgage lans n real estate Plicy lans 52,575 48,868 Real estate held fr investment 8,174 8,440 Other lng-term investments Ttal investments 1,029, ,235 Cash and cash equivalents 56,986 54,593 Accrued investment incme 13,262 12,251 Reinsurance recverable 4,330 4,394 Deferred plicy acquisitin csts 153, ,691 Cst f custmer relatinships acquired 24,182 23,374 Gdwill 17,306 17,160 Other intangible assets Prperty and equipment, net 6,380 6,662 Due premiums, net 10,027 11,209 Prepaid expenses 1, Other assets 1, Ttal assets $ 1,318,499 1,216,280 (Cntinued) 7

8 CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES Cnslidated Statements f Financial Psitin, Cntinued (In thusands) September 30, December 31, (Unaudited) Liabilities: Plicy liabilities: Future plicy benefit reserves: Life insurance $ 894, ,269 Annuities 58,741 55,485 Accident and health 1,205 1,250 Dividend accumulatins 15,381 13,662 Premiums paid in advance 37,432 32,560 Plicy claims payable 8,534 9,488 Other plicyhlders' funds 6,892 7,982 Ttal plicy liabilities 1,023, ,696 Cmmissins payable 2,563 2,562 Federal incme tax payable Deferred federal incme tax 10,309 1,704 Payable fr securities in prcess f settlement 3,787 Other liabilities 11,185 10,919 Ttal liabilities 1,051, ,471 Stckhlders' equity: Class A, cmmn stck 259, ,383 Class B, cmmn stck 3,184 3,184 Accumulated deficit (7,871) (12,542) Accumulated ther cmprehensive incme: Unrealized gains n securities, net f tax 23,087 6,795 Treasury stck, at cst (11,011) (11,011) Ttal stckhlders equity 266, ,809 Ttal liabilities and stckhlders equity $ 1,318,499 1,216,280 8