UTG INC
For the period ended Mar 31, 2026. Filed May 13, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 13, 2026
UTGNStored price and day change unavailable
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-14.
0000832480-25-000056
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-13.
0000832480-26-000013
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 64 previous paragraphs and 62 current paragraphs.
37 unchanged; 21 reworded; 4 added; 5 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (4)
Current report
The earnings reported by the equity securities investments represented 33% and 17% of the total consolidated investment income reported by the Company during the three months ended March 31, 2026 and 2025, respectively. The increase in earnings in this category is mainly the result of a single equity security in the oil & gas industry producing a one-time dividend of $420,000.
Current report
The average oil price per barrel was $65 in 2025, but at the end of March 2026, prices climbed above $100 per barrel, peaking at $115. If oil prices remain elevated above 2025 levels, the Company expects to receive higher royalty distributions for as long as prices stay above historical averages. The Company is unable to predict when the conflict will end or when oil supply disruptions will stabilize, or when price per barrel will see less volatility.
Current report
Operating expenses increased approximately 12% in the three month period ended March 31, 2026 as comparedto the same period in 2025. The increase in operating expenses is primarily attributable to increased salary costs and stock option amortization.
Current report
The Company owns a variety of investments associated with the oil and gas industry. These investments represent approximately 39% and 35% of the Company’s total invested assets as of March 31, 2026 and December 31, 2025, respectively. See Note 10 – Concentrations for more details related to our oil and gas concentrations.
Removed paragraphs (5)
Previous report
In the second half of 2024, the Federal Open Market Committee (“FOMC”) cut the interest rate 3 times for a total of 1% making the rate 4.50%. The rate was cut again in September 2025 making the rate 4.25%. The Company anticipates a similar decline in earnings on cash balances and any new investments that are acquired as investments mature. In October 2025, the FOMC cut the interest rate again making the current rate 4.00%.
Previous report
The earnings reported by the cash and short term investments represented 9% and 12% of the total consolidated investment income reported by the Company during the nine months ended September 30, 2025 and 2024, respectively. The decrease in earnings in this category is the result of a combination of higher cash and short term holdings in 2024 and from decreased interest rates received from banks and other deposit institutions due to FOMC rate changes. With the 2024 and 2025 rate declines of 1.25% through September 30, the Company anticipates experiencing a similar decline in earnings on cash balances going forward.
Previous report
In 2025, the Company reported realized gains on real estate of $46,846. This was the result of the sale of one small parcel of property located in Kentucky.
Previous report
Operating expenses were similar in the three month period, but decreased approximately 2% in the nine-month period ended September 30, 2025 as compared to the same period in 2024. All expense categories are comparable between years.
Previous report
There are a number of significant risks and uncertainties inherent in the process of monitoring impairments and determining if impairment is other-than-temporary. These risks and uncertainties related to Management’s assessment of other-than-temporary declines in value include but are not limited to: the risk that Company's assessment of an issuer's ability to meet all of its contractual obligations will change based on changes in the credit characteristics of that issuer; the risk that the economic outlook will be worse than expected or have more of an impact on the issuer than anticipated; the risk that fraudulent information could be provided to the Company's investment professionals who determine the fair value estimates.
Reworded paragraphs (21)
Previous wording
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts and related disclosures. Actual results could differ significantly from those estimates. The Company has identified certain estimates that involve a higher degree of judgment and are subject to a significant degree of variability. The Company's critical accounting policies and the related estimates considered most significant by Management are disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2024. Management has identified the accounting policies related to cost of insurance acquired, assumptions and judgments utilized in determining whether any decline in value is the result of a credit loss or other factors, and valuation methods for investments that are not actively traded as those, due to the judgments, estimates and assumptions inherent in those policies, are critical to an understanding of the Company's Condensed Consolidated Financial Statements and this Management's Discussion and Analysis.
Current wording
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts and related disclosures. Actual results could differ significantly from those estimates. The Company has identified certain estimates that involve a higher degree of judgment and are subject to a significant degree of variability. The Company's critical accounting policies and the related estimates considered most significant by Management are disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2025. Management has identified the accounting policies related to cost of insurance acquired, assumptions and judgments utilized in determining if declines in fair values of investments are other-than-temporary, and valuation methods for investments that are not actively traded as those, due to the judgments, estimates and assumptions inherent in those policies, are critical to an understanding of the Company's Condensed Consolidated Financial Statements and this Management's Discussion and Analysis.
Previous wording
During the nine-months ended September 30, 2025, there were no additions to or changes in the critical accounting policies disclosed in the 2024 Form 10-K.
Current wording
During the three-months ended March 31, 2026, there were no additions to or changes in the critical accounting policies disclosed in the 2025 Form 10-K.
Previous wording
On a consolidated basis, the Company reported net income attributable to common shareholders of approximately $21.3 million for the nine-month period ended September 30, 2025, and net income attributable to common shareholders of approximately $10.3 million for the three-month period ended September 30, 2025.
Current wording
On a consolidated basis, the Company reportednet income attributable to common shareholders of approximately $23.4 and $13.0 million for the three-month period ended March 31, 2026 and 2025, respectively.
Previous wording
For the nine-month period ended September 30, 2025, the Company reported total revenues of approximately $42.6 million and for the same period in 2024 total revenues of approximately $68.9 million. The Company reported total revenues of approximately $17.3 million and $40.4 million for the three-month period ended September 30, 2025 and 2024, respectively.
Current wording
For the three-month period ended March 31, 2026, the Company reported total revenues of approximately $36.5 million and for the same period in 2025 total revenues of approximately $21.9 million.
Previous wording
The variance in total revenue between third quarter 2025 and 2024 is primarily the result of the change in the fair value of equity securities. The Company reported a third quarter 2025 gain in the change in the fair value of equity securities of approximately $10.7 million and a year-to-date 2025 gain of approximately $25.7 million. In 2024, the Company reported a third quarter gain in the change in the fair value of equity securities of approximately $33.8 million and a year-to-date gain of approximately $51.5 million. The stock markets have experienced volatility in recent periods, which in general, should always be expected.
Current wording
The variance in total revenue between first quarter 2026 and 2025 is primarilythe result of the change in the fair value of equity securities. The Company reported a first quarter 2026 gain in the change in the fair value of equity securities of approximately $28.2 million. In 2025, the Company reported a first quarter gain in the change in the fair value of equity securities of approximately $16.3 million. The stock markets have experienced volatility in recent periods, which in general, should always be expected.
Previous wording
The Company reported revenue before net investment gains (losses) of approximately $14.5 million and $15.3 million for the nine-month-period ended September 30, 2025 and 2024, respectively. The Company reported $5.2 million and $5.0 million, respectively, of revenue before net investment gains (losses) for the third quarter of 2025 and 2024, respectively. The 2025 results are comparable to 2024 for third quarter and year-to-date.
Current wording
The Company reported revenue before net investment gains of approximately $4.7 million and $4.6 million for the three-month-period ended March 31, 2026 and 2025, respectively. The 2026 results are comparable to 2025 for first quarter.
Previous wording
Net investment income represented 73% and 71% of the Company's revenue before net investment gains (losses) as of September 30, 2025 and 2024, respectively. For the third quarter ended September 30, net investment income represented 77% and 72% of revenue before net investment gains (losses) for 2025 and 2024, respectively. When comparing current and prior year results, net investment income was comparable in most of the investment categories outside of the cash and short term investment portfolios.
Current wording
Net investment income represented 70% and 67% of the Company's revenue before net investment gainsas of March 31, 2026 and 2025, respectively. When comparing current and prior year results, net investment income was comparable in most of the investment categories outside of the equity securities investment portfolio.
Previous wording
The following table reflects net investment gains (losses):
Current wording
The following table reflects net investment gains:
Previous wording
In 2025, the sale of three equity securities represents all the realized investment gains from equity securities year-to-date with one of these sales being in third quarter.
Current wording
In 2026, the sale of four equity securities represents all the realized investment gains from equity securities.
Previous wording
The Company reported a year-to-date 2025 change in the fair value of equity securities of approximately $25.7 million, and a third quarter gain of approximately $10.7 million. In 2024, The Company reported a year-to-date change in the fair value of equity securities of approximately $51.5 million, and a second quarter gain of approximately $33.8 million. This line item is material to the results reported in the Condensed Consolidated Statements of Operations, and this line item can also be extremely volatile, as it reflects changes in the stock market. While these results can be material and volatile, most of the equity holdings of the Company were acquired with a long-term view, thus making these intermediate changes in value of less concern to Management. Management monitors its equity holdings looking more at the specific entity and market it is in relative to performance and less to changes due to general market swings that occur over the holding period of the investment.
Current wording
The Company reported a year-to-date 2026 change in the fair value of equity securities of approximately $28.2 million. In 2025, The Company reported a year-to-date change in the fair value of equity securities of approximately $16.3 million. This line item is material to the results reported in the Condensed Consolidated Statements of Operations, and this line item can also be extremely volatile, as it reflects changes in the stock market. Of the 2026 change in fair value of equity securities, approximately $18.3 million is attributable to a single equity security holding related to the oil and gas industry. While these results can be material and volatile, most of the equity holdings of the Company were acquired with a long-term view, thus making these intermediate changes in value of less concern to Management. Management monitors its equity holdings looking more at the specific entity and market it is in relative to performance and less to changes due to general market swings that occur over the holding period of the investment.
Previous wording
The Company reported total benefits and other expenses of approximately $15.7 million for the nine month period ended September 30, 2025, which is comparable to the same period in 2024. Benefits, claims and settlement expenses represented approximately 59% and 58% of the Company's total expenses for the nine month periods ended September 30, 2025 and 2024, respectively. The other major expense category of the Company is operating expenses, which represented approximately 39% and 39% of the Company's total expenses for the nine month periods ended September 30, 2025 and 2024, respectively.
Current wording
The Company reported total benefits and other expenses of approximately $6.8 million and $5.1 million for the three month period ended March 31, 2026 and 2025, respectively. Benefits, claims and settlement expenses represented approximately 63% and 56% of the Company's total expenses for the three month periods ended March 31, 2026 and 2025, respectively. The other major expense category of the Company is operating expenses, which represented approximately 35% and 41% of the Company's total expenses for the three month periods ended March 31, 2026 and 2025, respectively.
Previous wording
Life benefits, claims and settlement expenses, net of reinsurance benefits and claims were similar when comparing the nine months ended September 30, 2025, and 2024. When comparing third quarter 2025 and 2024 results, life benefits, claims and settlement expenses were down approximately 24%. Policy claims vary from period to period and therefore, fluctuations in mortality are to be expected and are not considered unusual by Management.
Current wording
When comparing first quarter 2026 and 2025 results, life benefits, claims and settlement expenses were up approximately $1.4 million. Policy claims vary from period to period and therefore, fluctuations in mortality are to be expected and are not considered unusual by Management.
Previous wording
Investments are the largest asset group of the Company. The Company's insurance subsidiary is regulated by insurance statutes and regulations as to the type of investments they are permitted to make, and the amount of funds that may be used for any one type of investment.
Current wording
Investments are the largest asset group of the Company. The Company's insurance subsidiary is regulated by insurance statutes and regulations as to the type of investments they are permitted to make, and the amount of funds that may be used for any one type of investment. The below table reflects, by investment category, the investments held by the Company as of March 31, 2026, and December 31, 2025:
Previous wording
The Company’s total investments represented 84% and 84% of the Company’s total assets as of September 30, 2025, and December 31, 2024, respectively. Fixed maturities and equity securities consistently represented a substantial portion, 87% and 84%, of the total investments during 2025 and 2024, respectively. The overall investment mix, as a percentage of total investments, remained fairly consistent when comparing the respective investments held as of September 30, 2025 and December 31, 2024.
Current wording
The Company’s total investments represented 85% and 88% of the Company’s total assets as of March 31, 2026, and December 31, 2025, respectively. Fixed maturities and equity securities consistently represented a substantial portion, 82% and 79%, of the total investments during 2026 and 2025, respectively. The overall investment mix, as a percentage of total investments, remained fairly consistent when comparing therespective investments held as of March 31, 2026 and December 31,2025.
Previous wording
As of September 30, 2025, the carrying value of fixed maturity securities in default as to principal or interest was immaterial in the context of consolidated assets, shareholders’ equity or results from operations. To provide additional flexibility and liquidity, the Company has identified all fixed maturity securities as "investments available for sale". Investments available for sale are carried at market value, with changes in market value charged directly to the other comprehensive component of shareholders' equity. Changes in the market value of available for sale securities resulted in net unrealized gains (losses) of approximately $1,441,000 and 1,107,000 as of September 30, 2025 and 2024, respectively. The variance in the net unrealized gains and losses is the result of normal market fluctuations mainly related to changes in interest rates in the marketplace.
Current wording
As of March 31, 2026, the carrying value of fixed maturity securities in default as to principal or interest was immaterial in the context of consolidated assets, shareholders’ equity or results from operations. To provide additional flexibility and liquidity, the Company has identified all fixed maturity securities as "investments available for sale". Investments available for sale are carried at market value, with changes in market value charged directly to the other comprehensive component of shareholders' equity. Changes in the market value of available for sale securities resulted in net unrealized gains (losses) of approximately $(328,000) and $1.6 million as of March 31, 2026 and 2025, respectively. The variance in the net unrealized gains and losses is the result of normal market fluctuations mainly related to changes in interest rates in the marketplace.
Previous wording
During October of 2025, the Federal Home Loan Bank approved the renewal of UG’s Cash Management Advance Application (“CMA”). The CMA is a source of overnight liquidity utilized to address the day-to-day cash needs of a Company. The CMA gives the company the option of selecting a variable rate of interest for up to 90 days or a fixed rate for a maximum of 30 days. The variable rate CMA is prepayable at any time without a fee, while the fixed CMA is not prepayable prior to maturity. The Company has pledged bonds with a collateral lendable value of $21.4 million as of September 30, 2025. The Company has no outstanding borrowings on the CMA at September 30, 2025 nor had any borrowing activity during 2025.
Current wording
During October of 2025, the Federal Home Loan Bank approved the renewal of UG’s Cash Management Advance Application (“CMA”). The CMA is a source of overnight liquidity utilized to address the day-to-day cash needs of a Company. The CMA gives the company the option of selecting a variable rate of interest for up to 90 days or a fixed rate for a maximum of 30 days. The variable rate CMA is prepayable at any time without a fee, while the fixed CMA is not prepayable prior to maturity. The Company has pledged bonds with a collateral lendable value of $21.7 million as of March 31, 2026. The Company has no outstanding borrowings on the CMA at March 31, 2026 nor had any borrowing activity during 2026.
Previous wording
Cash used in operating activities was approximately $4.4 million in 2025 and $552,000 in 2024. Sources of operating cash flows of the Company, as with most insurance entities, is comprised primarily of premiums received on life insurance products and income earned on investments. Uses of operating cash flows consist primarily of payments of benefits to policyholders and beneficiaries and operating expenses. The Company has not marketed any significant new products for several years. As such, premium revenues continue to decline with the exception of fluctuations in reinsurance premiums. Management anticipates future cash flows from operations to remain similar to historic trends.
Current wording
Cash used inoperating activities was approximately $2.6 million in 2026 and cash used by operating activities was approximately $3.3 million in 2025. Sources of operating cash flows of the Company, as with most insurance entities, is comprised primarily of premiums received on life insurance products and income earned on investments. Uses of operating cash flows consist primarily of payments of benefits to policyholders and beneficiaries and operating expenses. The Company has not marketed any significant new products for several years. As such, premium revenues continue to decline with the exception of fluctuations in reinsurance premiums. Management anticipates future cash flows from operations to remain similar to historic trends.
Previous wording
During 2025, the Company’s investing activities provided net cash of approximately $9.2 million and provided net cash of approximately $15.2 million in 2024. The Company recognized proceeds of approximately $28.2 million and $45.5 million from investments sold and matured in 2025 and 2024, respectively. The Company used approximately $18.9 million and $30.3 million to acquire investments during 2025 and 2024, respectively. The net cash provided by or used in investing activities is expected to vary from year to year depending on market conditions and management’s ability to find and negotiate favorable investment contracts.
Current wording
During 2026, the Company’s investing activities provided net cash of approximately $19.8 million andusednet cash of approximately $5.0 million in 2025. The Company recognized proceeds of approximately $22.8 million and $6.8 million from investments sold and matured in 2026 and 2025, respectively. The Company used approximately $3.0 million and $11.8 million to acquire investments during 2026 and 2025, respectively. The net cash provided by or used in investing activities is expected to vary from year to year depending on market conditions and management’s ability to find and negotiate favorable investment contracts.
Previous wording
Net cash used in financing activities was approximately $625,000 and $19.8 million during 2025 and 2024, respectively. As of September 30, 2025 and 2024, the Company had no debt outstanding with third parties.
Current wording
Net cash used in financing activities was approximately $930,000 and $229,000 during 2026 and 2025, respectively. As of March 31, 2026 and 2025, the Company hadno debt outstanding with third parties.
Previous wording
The Company had cash and cash equivalents of approximately $49.5 million and $45.3 million as of September 30, 2025 and December 31, 2024, respectively. The Company has a portfolio of marketable fixed maturity securities that could be sold, if an unexpected event were to occur. These securities had a fair value of approximately $72.6 million at September 30, 2025. However, the strong cash flows from investing activities, investment maturities and the availability of the line of credit facilities make it unlikely that the Company would need to sell securities for liquidity purposes.
Current wording
The Company had cash and cash equivalents of approximately $46.8 million and $30.5 million as of March 31, 2026 and December 31, 2025, respectively. The Company has a portfolio of marketable fixed maturity securities that could be sold, if an unexpected event were to occur. These securities had a fair value of approximately $72.2 million at March 31, 2026. However, the strong cash flows from investing activities, investment maturities and the availability of the line of credit facilities make it unlikely that the Company would need to sell securities for liquidity purposes.
Previous wording
Total shareholders' equity increased by approximately 10% as of September 30, 2025, compared to December 31, 2024. The increase is mainly attributable to an increase in retained earnings, which is the result of the current year net income reported by the Company and by the increase in market value of the available for sale fixed maturities portfolio.
Current wording
Total shareholders' equity increased by approximately 10% as of March 31, 2026, compared to December 31, 2025. The increase is mainly attributable to an increase in retained earnings, which is the result of the current year net income reported by the Company.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The following table reflects, by investment category, the investments held by the Company as of September 30, 2025, and December 31, 2024: