UTG INC
For the period ended Jun 30, 2026. Filed Aug 12, 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.
Jun 30, 2026 · Filed Aug 12, 2026
UTGNStored price and day change unavailable
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious 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 OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-12.
0000832480-26-000023
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 62 previous paragraphs and 64 current paragraphs.
39 unchanged; 22 reworded; 3 added; 1 removed; 0 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 (3)
Current report
The earnings reported by the mortgage loan investments represented 6% and 5% of the total consolidated investment income reported by the Company during the six months ended June 30, 2026 and 2025, respectively. In second quarter 2026, the Company originated a new large mortgage loan that caused this increase.
Current report
The average price of crude oil was approximately $65 per barrel during 2025. Beginning in late February 2026, crude oil prices increased significantly as geopolitical tensions in the Middle East escalated, including military conflict involving Iran and disruptions to shipping through the Strait of Hormuz, a critical transit route for global oil exports. These events created uncertainty regarding global oil supply, causing volatility in oil prices ranging from $60 per barrel and peak at approximately $115 per barrel. Although market conditions improved during the second quarter and prices moderated to approximately $80 per barrel by the end of June 2026, crude oil prices remained above the average levels experienced during 2025.
Current report
Because the Company's royalty income is directly influenced by oil prices, sustained crude oil prices above historical averages are expected to result in higher royalty distributions. However, future royalty income will continue to depend on the duration and severity of geopolitical events, the restoration of normal shipping through the Strait of Hormuz, global oil supply and demand conditions, and the resulting volatility in crude oil markets. Management cannot predict the timing or outcome of these events, and therefore cannot estimate the extent to which future oil prices or royalty distributions may be affected.
Removed paragraphs (1)
Previous 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.
Reworded paragraphs (22)
Previous 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.
Current wording
During the six-months ended June 30, 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 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.
Current wording
On a consolidated basis, the Company reportednet income attributable to common shareholders of approximately $29.8 and 11.3 million for the six-month period ended June 30, 2026 and 2025, respectively. The Company reportednet income (loss) attributable to common shareholders of approximately $6.3 and ($1.6) million for the three-month period ended June 30, 2026 and 2025, respectively.
Previous 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.
Current wording
For the six-month period ended June 30, 2026, the Company reported total revenues of approximately $50.4 million and for the same period in 2025 total revenues of approximately $25.3 million. The Company reported total revenues of approximately $13.9 million and $3.4 million for the three-month period ended June 30, 2026 and 2025, respectively.
Previous 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.
Current wording
The variance in total revenue between second quarter 2026 and 2025 is primarilythe result of realized gains and the change in the fair value of equity securities. The Company reported a second quarter 2026 gain in the change in the fair value of equity securities of approximately $2.3 million and a year-to-date 2026 gain of approximately $30.5 million. In 2025, the Company reported a second quarter loss in the change in the fair value of equity securities of approximately $1.3 million and a year-to-date 2025 gain of approximately $15.0 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 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.
Current wording
The Company reported revenue before net investment gains of approximately $10.5 million and $9.2 million for the six-month-period ended June 30, 2026 and 2025, respectively. The Company reported $5.7 million and $4.6 million, respectively, of revenue before net investment gains (losses) for the second quarter of 2026 and 2025, respectively. The 2026 net investment income results are comparable to 2025 for second quarter and year-to-date.
Previous 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.
Current wording
Net investment income represented 77% and 71% of the Company's revenue before net investment gainsas of June, 30, 2026 and 2025, respectively. For the second quarter ended June 30, net investment income represented 82% and 76% of revenue before net investment gains (losses) for 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 mortgage loans and equity securities investment portfolios.
Previous wording
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 wording
The earnings reported by the equity securities investments represented 33% and 19% of the total consolidated investment income reported by the Company during the six months ended June 30, 2026 and 2025, respectively. In first quarter, a single equity security in the oil & gas industry produced a one-time dividend of $420,000. In second quarter the increase is primarily due to a single equity security producing a one-time dividend of $501,000, and an overall increase in distributions related to oil & gas royalties.
Previous wording
The following table reflects net investment gains:
Current wording
The following table reflects net investment gains (losses):
Previous wording
In 2026, the sale of four equity securities represents all the realized investment gains from equity securities.
Current wording
In 2026, the sale of five equity securities represents the majority of the realized investment gains from equity securities year-to-date with one of these sales being in the second quarter. Most of these sales are related to the oil/gas industry and the information technology industry.
Previous 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.
Current wording
The Company reported a year-to-date 2026 change in the fair value of equity securities of approximately $30.5 million, and a second quarter gain of approximately $2.3 million. In 2025, The Company reported a year-to-date change in the fair value of equity securities of approximately $15.0 million, and a second quarter loss of approximately $1.3 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 $17.1 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 $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.
Current wording
The Company reported total benefits and other expenses of approximately $12.6 million and $10.5 million for the six month period ended June 30, 2026 and 2025, respectively. For the three month period ended June 30, 2026 and 2025, the Company reported total benefits and other expenses of approximately $5.9 million and $5.4 million, respectively. Benefits, claims and settlement expenses represented approximately 57% and 59% of the Company's total expenses for the six month periods ended June 30, 2026 and 2025, respectively. The other major expense category of the Company is operating expenses, which represented approximately 41% and 39% of the Company's total expenses for the six month periods ended June 30, 2026 and 2025, respectively.
Previous 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.
Current wording
When comparing year-to-date 2026 and 2025 results, life benefits, claims and settlement expenses were up approximately $1.1 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
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 wording
Operating expenses increased approximately $1.1 million in the six month period ended June 30, 2026 as comparedto the same period in 2025. Increased salary costs due to an increase in bonus accrual make up 26% of the increase, and charitable contributions make up 20% of the increase. Both of these increased costs are related to the increase in 2026 earnings. Stock option amortization makes up 16% of the increase, the Company issued stock options in the third quarter of 2025. The Company also had increased actuarial costs due to the implementation of the new LDTI accounting standard, this cost makes up 9% of the increase.
Previous wording
Net amortization of cost of insurance acquired decreased approximately 3% when comparing current and prior year activity. Cost of insurance acquired is established when an insurance company is acquired or when the Company acquires a block of in-force business. The Company assigns a portion of its cost to the right to receive future profits from insurance contracts existing at the date of the acquisition. Cost of insurance acquired is amortized with interest in relation to expected future profits, including direct charge-offs for any excess of the unamortized asset over the projected future profits. The interest rates may vary due to risk analysis performed at the time of acquisition on the business acquired. The Company utilizes a 12% discount rate on the remaining unamortized business. The amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised. Amortization of cost of insurance acquired is particularly sensitive to changes in interest rate spreads and persistency of certain blocks of insurance in-force. This expense is expected to decrease unless the Company acquires a new block of business.
Current wording
Net amortization of cost of insurance acquired decreased approximately 1% when comparing current and prior year activity. Cost of insurance acquired is established when an insurance company is acquired or when the Company acquires a block of in-force business. The Company assigns a portion of its cost to the right to receive future profits from insurance contracts existing at the date of the acquisition. Cost of insurance acquired is amortized with interest in relation to expected future profits, including direct charge-offs for any excess of the unamortized asset over the projected future profits. The interest rates may vary due to risk analysis performed at the time of acquisition on the business acquired. The Company utilizes a 12% discount rate on the remaining unamortized business. The amortization is adjusted retrospectively when estimates of current or future gross profits to be realized from a group of products are revised. Amortization of cost of insurance acquired is particularly sensitive to changes in interest rate spreads and persistency of certain blocks of insurance in-force. This expense is expected to decrease unless the Company acquires a new block of business.
Previous 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.
Current wording
The Company’s total investments represented 86% and 88% of the Company’s total assets as of June 30, 2026, and December 31, 2025, respectively. Fixed maturities and equity securities at fair value consistently represented a substantial portion, 81% 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 June 30, 2026 and December 31,2025.
Previous 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.
Current wording
As of June 30, 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 $(349,000) and $1.6 million as of June 30, 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
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.
Current wording
The Company owns a variety of investments associated with the oil and gas industry. These investments represent approximately 37% and 35% of the Company’s total invested assets as of June 30, 2026 and December 31, 2025, respectively. See Note 10 – Concentrations for more details related to our oil and gas concentrations.
Previous 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.
Current wording
Cash used inoperating activities was approximately $5.5 million in 2026 and cash used by operating activities was approximately $4.3 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 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.
Current wording
During 2026, the Company’s investing activities provided net cash of approximately $18.7 million andusednet cash of approximately $2.4 million in 2025. The Company recognized proceeds of approximately $39.1 million and $12.9 million from investments sold and matured in 2026 and 2025, respectively. The Company used approximately $20.4 million and $15.3 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 $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.
Current wording
Net cash used in financing activities was approximately $1,192,000 and $134,000 during 2026 and 2025, respectively. As of June 30, 2026 and 2025, the Company hadno debt outstanding with third parties.
Previous 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.
Current wording
The Company had cash and cash equivalents of approximately $42.6 million and $30.5 million as of June 30, 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 $72.1 million at June 30, 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 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.
Current wording
Total shareholders' equity increased by approximately 13% as of June 30, 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.