SECURITY NATIONAL FINANCIAL CORP
For the period ended Mar 31, 2026. Filed May 11, 2026.
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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 11, 2026
SNFCA$9.48+1.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-13.
0001493152-25-022216
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-11.
0001493152-26-022202
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 60 previous paragraphs and 44 current paragraphs.
12 unchanged; 24 reworded; 8 added; 22 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 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 (8)
Current report
Profitability for the three-month period ended March 31, 2026 decreased due to (a) a $924,000 decrease in insurance premiums and other considerations, (b) a $914,000 decrease in net investment income, (c) a $211,000 decrease in other revenues, and (d) a $66,000 increase in amortization of deferred policy acquisition costs, which were partially offset by (i) a $916,000 decrease in policyholder benefits and claims, (ii) a $435,000 decrease in selling, general and administrative expenses, (iii) a $203,000 increase in intersegment revenue, (iv) a $122,000 decrease in income tax expense, (v) a $92,000 increase in gains on investments and other assets, (vi) a $49,000 decrease in intersegment expenses, and (vii) a $14,000 decrease in interest expense.
Current report
Funeral Home and Cemetery Operations
Current report
The following table shows the condensed financial results of the funeral home and cemetery operations for the three-month periods ended March 31, 2026, and 2025. See Note 16 to the condensed consolidated financial statements.
Current report
Losses for the three-month period ended March 31, 2026 decreased due to (a) a $1,988,000 decrease in personnel expenses, (b) a $1,285,000 decrease in commissions, (c) a $910,000 increase in the fair value of loan commitments, (d) a $556,000 increase in income from loan originations, (e) a $161,000 decrease in rent and rent related expenses, (f) a $110,000 decrease in interest expense, (g) a $35,000 decrease in depreciation on property and equipment, and (h) a $28,000 decrease in advertising expenses, which were partially offset by (i) a $2,245,000 decrease in the fair value of loans held for sale, (ii) a $540,000 decrease in secondary gains from investors, (iii) a $352,000 decrease in income tax benefit, (iv) a $259,000 increase in costs related to funding mortgage loans, (v) a $231,000 increase in other expenses, (vi) a $210,000 increase in intersegment expenses, (vii) a $153,000 increase in data processing and IT related expenses, (viii) a $50,000 decrease in intersegment revenues, (ix) a $43,000 decrease in gains on investments and other assets, (x) a $26,000 decrease in other revenues, and (xi) a $19,000 decrease in net investment income.
Current report
Policyholder benefits and claims decreased by $916,000 or 3.6%, to $24,539,000 for the three-month period ended March 31, 2026, from $25,455,000 for the comparable period in 2025. This decrease was primarily the result of a $679,000 decrease in future policy benefits, a $156,000 decrease in death benefits, and an $81,000 decrease in surrender and other policy benefits.
Current report
Amortization of deferred policy and pre-need acquisition costs and value of business acquired increased by $182,000, or 6.5%, to $2,979,000 for the three-month period ended March 31, 2026, from $2,797,000 for the comparable period in 2025. This increase is due to a $192,000 increase in the amortization of deferred policy and pre-need acquisition costs due to an increase in the average outstanding balance. This increase was partially offset by a $10,000 decrease in the amortization of value of business acquired due to no new deferrals and a decreasing average outstanding balance.
Current report
Funeral home and cemetery cost of goods and services sold decreased by $20,000, or 1.6%, to $1,233,000 for the three-month period ended March 31, 2026, from $1,253,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $18,000 in at-need sales and decrease of $2,000 in pre-need sales.
Current report
Income tax expense increased by $214,000, or 11.7%, to $2,051,000 for the three-month period ended March 31, 2026, from $1,837,000 for the comparable period in 2025. This increase was primarily due to an increase in earnings before income taxes for 2026 compared to 2025. The Company’s overall effective tax rate increased from 22.3% for 2025 to 22.7% in 2026, a 0.4% increase in the effective tax rate or a 1.8% change. This increase was primarily due to certain permanent tax adjustments that are higher when compared to the prior year.
Removed paragraphs (22)
Previous report
Profitability for the nine month period ended September 30, 2025 decreased due to (a) a $5,991,000 increase in selling, general and administrative expenses, primarily attributable to a $3,623,000 increase in personnel expenses due to an annual increase in salaries and key new hires as a part of the Company’s growth strategy, (b) a $4,728,000 increase in amortization of deferred policy acquisition costs, (c) a $2,896,000 increase in death benefits, (d) a $354,000 increase in surrenders and other policy benefits (e) a $159,000 decrease in intersegment revenue, and (f) a $22,000 increase in interest expense, which were partially offset by (i) a $5,008,000 increase in net investment income, (ii) a $1,490,000 decrease in income tax expense, (iii) a $983,000 decrease in future policy benefits, (iv) a $282,000 increase in other revenues, (v) a $228,000 increase in gains on investments and other assets, (vi) a $157,000 decrease in intersegment expenses, and (vii) a $22,000 increase in insurance premiums and other considerations.
Previous report
Cemetery and Mortuary Operations
Previous report
The following table shows the condensed financial results of the cemetery and mortuary operations for the three- and nine-month periods ended September 30, 2025, and 2024. See Note 7 to the condensed consolidated financial statements.
Previous report
Losses for the nine month period ended September 30, 2025 increased due to (a) a $3,452,000 decrease in the fair value of loans held for sale, (b) a $2,075,000 increase in commissions, (c) a $1,371,000 decrease in other revenues, (d) a $1,197,000 increase in other expenses, (e) a $1,068,000 decrease in income from loan originations, (f) a $443,000 increase in costs related to funding mortgage loans, (g) a $337,000 increase in advertising expenses, (h) a $296,000 increase in interest expense, (i) a $296,000 decrease in net investment income, and (j) a $157,000 decrease in intersegment revenues, which were partially offset by (i) a $6,130,000 increase in secondary gains from investors, (ii) a $1,144,000 increase in gains on investments and other assets, (iii) a $1,132,000 decrease in rent and rent related expenses, (iv) a $452,000 increase in income tax benefit, (v) a $213,000 decrease in personnel expenses, (vi) a $148,000 increase in the fair value of loan commitments, and (vii) a $138,000 decrease in intersegment expenses.
Previous report
Net mortuary and cemetery sales increased by $327,000, or 4.8%, to $7,141,000 for the three-month period ended September 30, 2025, from $6,814,000 for the comparable period in 2024. This increase was primarily due to a $301,000 increase in mortuary at-need sales, a $23,000 increase in cemetery at-need sales, and a $3,000 increase in cemetery pre-need sales.
Previous report
Death benefits, surrenders and other policy benefits, and future policy benefits increased by an aggregate of $1,580,000 or 6.8%, to $24,934,000 for the three-month period ended September 30, 2025, from $23,354,000 for the comparable period in 2024. This increase was primarily the result of a $1,612,000 increase in death benefits and a $180,000 increase in surrender and other policy benefits, which were partially offset by a $212,000 decrease in future policy benefits.
Previous report
Amortization of deferred policy and pre-need acquisition costs and value of business acquired increased by $3,246,000, or 142.0%, to $5,533,000 for the three-month period ended September 30, 2025, from $2,287,000 for the comparable period in 2024. This increase was primarily due to an increase in the termination rate for deaths, lapses, policies moving to a reduced paid up status, and a shift in product mix.
Previous report
Selling, general and administrative expenses increased by $1,286,000, or 2.8%, to $46,525,000 for the three-month period ended September 30, 2025, from $45,239,000 for the comparable period in 2024. This increase was primarily the result of a $1,409,000 increase in other expenses, a $269,000 increase in personnel expenses, a $119,000 increase in costs related to funding mortgage loans, and a $76,000 increase in advertising expense, which were partially offset by a $432,000 decrease in rent and rent related expenses, a $150,000 decrease in commissions, and a $5,000 decrease in depreciation on property and equipment.
Previous report
Cost of goods and services sold in mortuaries and cemeteries decreased by $4,000, or 0.4%, to $1,113,000 for the three-month period ended September 30, 2025, from $1,117,000 for the comparable period in 2024. This decrease was primarily due to a decrease of $20,000 in pre-need sales, which was partially offset by an increase of $16,000 in at-need sales.
Previous report
In summary, total benefits and expenses were $79,173,000, or 88.6% of total revenues, for the three-month period ended September 30, 2025, as compared to $73,059,000, or 82.8% of total revenues, for the comparable period in 2024.
Previous report
Nine-month period ended September 30, 2025, Compared to Nine-month period ended September 30, 2024
Previous report
Total revenues increased by $6,354,000, or 2.5%, to $261,607,000 for the nine-month period ended September 30, 2025, from $255,253,000 for the comparable period in 2024. Contributing to this increase in total revenues was a $4,103,000 increase in net investment income, a $1,758,000 increase in mortgage fee income, a $1,061,000 increase in gains on investments and other assets, a $167,000 increase in net mortuary and cemetery sales, and a $22,000 increase in insurance premiums and other considerations, which were partially offset by a $758,000 decrease in other revenues.
Previous report
Mortgage fee income increased by $1,758,000, or 2.2%, to $83,433,000, for the nine-month period ended September 30, 2025, from $81,675,000 for the comparable period in 2024. This increase was primarily due to a $6,130,000 increase in secondary gains from mortgage loans sold to third-party investors into the secondary market and a $148,000 increase in the fair value of loan commitments, which were partially offset by a $3,452,000 decrease in the fair value of loans held for sale, and a $1,068,000 decrease in income from loan originations.
Previous report
Insurance premiums and other considerations increased by $22,000, less than a percentage point, to $89,846,000 for the nine-month period ended September 30, 2025, from $89,824,000 for the comparable period in 2024. This increase was primarily due to an increase of $1,432,000 in renewal premiums, which was partially offset by a decrease of $1,410,000 in first year premiums.
Previous report
Other revenues decreased by $758,000, or 20.00%, to $3,034,000 for the nine-month period ended September 30, 2025, from $3,792,000 for the comparable period in 2024. This decrease was primarily due to a decrease of $713,000 in other miscellaneous revenues and a decrease of $45,000 in servicing fee revenue due to a decrease in the retention of mortgage servicing rights.
Previous report
Death benefits, surrenders and other policy benefits, and future policy benefits increased by an aggregate of $2,267,000 or 3.1%, to $76,223,000 for the nine-month period ended September 30, 2025, from $73,956,000 for the comparable period in 2024. This increase was primarily the result of a $2,896,000 increase in death benefits and a $354,000 increase in surrender and other policy benefits, which were partially offset by $983,000 decrease in future policy benefits.
Previous report
Amortization of deferred policy and pre-need acquisition costs and value of business acquired increased by $4,635,000, or 40.9%, to $15,968,000 for the nine-month period ended September 30, 2025, from $11,332,000 for the comparable period in 2024. This increase was primarily due to an increase in the termination rate for deaths, lapses, policies moving to a reduced paid up status, and a shift in product mix.
Previous report
Interest expense increased by $317,000, or 10.0%, to $3,479,000 for the nine-month period ended September 30, 2025, from $3,162,000 for the comparable period in 2024. This increase was primarily due to an increase of $296,000 in interest expense on mortgage warehouse lines of credit for loans held for sale and an increase of $21,000 in interest expense on bank loans.
Previous report
Cost of goods and services sold in mortuaries and cemeteries decreased by $101,000, or 2.8%, to $3,526,000 for the nine-month period ended September 30, 2025, from $3,627,000 for the comparable period in 2024. This decrease was primarily due to a decrease of $87,000 in at-need sales and a decrease of $14,000 in pre-need sales.
Previous report
In summary, total benefits and expenses were $237,547,000, or 90.8% of total revenues, for the nine-month period ended September 30, 2025, as compared to $221,030,000, or 86.6% of total revenues, for the comparable period in 2024.
Previous report
As of September 30, 2025, SecurityNational Mortgage was not in compliance with the adjusted tangible net worth covenant of Western Alliance Bank’s warehouse line of credit. SecurityNational Mortgage is in the process of receiving waivers. In the unlikely event the Company is required to repay the outstanding advances of approximately $7,412,571 on the warehouse lines of credit, the Company has sufficient cash to do so. The Company has also performed an analysis of its funding capacities of both internal and external sources and has determined that there are sufficient funds to continue its current business model. The Company continues to negotiate other warehouse lines of credit with other lenders.
Previous report
The One Big Beautiful Bill Act (“OBBBA”), which was signed into law on July 4, 2025, significantly affected U.S. income tax law. The Company is currently assessing its impact; however, the Company does not expect a material impact to its consolidated financial statements.
Reworded paragraphs (24)
Previous wording
The Company’s operations over the last several years generally reflect three strategies which the Company expects to continue: (i) increased attention to “niche” insurance products, such as the Company’s funeral plan policies and traditional whole life products; (ii) increased emphasis on the cemetery and mortuary business; and (iii) capitalizing on an improving housing market by originating mortgage loans.
Current wording
The Company’s operations over the last several years generally reflect three strategies which the Company expects to continue: (i) increased attention to “niche” insurance products, such as the Company’s funeral plan policies and traditional whole life products; (ii) increased emphasis on the funeral home and cemetery business; and (iii) capitalizing on the housing market by originating mortgage loans.
Previous wording
The following table shows the condensed financial results of the insurance operations for the three- and nine-month periods ended September 30, 2025, and 2024. See Note 7 to the condensed consolidated financial statements.
Current wording
The following table shows the condensed financial results of the insurance operations for the three-month periods ended March 31, 2026, and 2025. See Note 16 to the condensed consolidated financial statements.
Previous wording
The Company sells mortuary services and products through its eleven mortuaries in Utah and four mortuaries in New Mexico. The Company also sells cemetery services, products and land (burial plots) through its five cemeteries in Utah, one cemetery in San Diego County, California, and one cemetery in Santa Fe, New Mexico. At-need mortuary and cemetery product sales and services are recognized as revenue when the services are performed or when the products are delivered. Pre-need mortuary and cemetery product sales and services are deferred until the merchandise is delivered, or services are performed. Revenue for pre-need cemetery land sales is recognized at the time of sale, and land is removed from inventory.
Current wording
The Company sells funeral home services and products through its eleven funeral homes in Utah and four funeral homes in New Mexico. The Company also sells cemetery services, products and land (burial plots) through its five cemeteries in Utah, one cemetery in San Diego County, California, and one cemetery in Santa Fe, New Mexico. At-need funeral home and cemetery product sales and services are recognized as revenue when the services are performed or when the products are delivered. Pre-need funeral home and cemetery product sales and services are deferred until the merchandise is delivered, or services are performed. Revenue for pre-need cemetery land sales is recognized at the time of sale, and land is removed from inventory.
Previous wording
Profitability in the nine month period ended September 30, 2025 decreased due to (a) a $701,000 increase in selling, general and administrative expenses, primarily attributable to a $555,000 increase in personnel expenses, (b) a $608,000 decrease in net investment income, (c) a $311,000 decrease in gains on investments and other assets, (d) a $240,000 decrease in cemetery pre-need sales, (e) a $108,000 decrease in cemetery at-need sales, and (f) a $1,000 decrease in intersegment revenues, which were partially offset by (i) a $516,000 increase in mortuary at-need sales, (ii) a $331,000 increase in other revenues, (iii) a $303,000 decrease in income tax expense, (iv) a $101,000 decrease in cost of goods and services sold, (v) a $92,000 decrease in amortization of deferred policy acquisition costs, and (vi) a $22,000 decrease in intersegment expenses.
Current wording
Profitability in the three-month period ended March 31, 2026 decreased due to (a) a $353,000 increase in selling, general and administrative expenses, primarily attributable to a $195,000 increase in personnel expenses, (b) a $284,000 decrease in gains on investments and other assets, (c) a $116,000 increase in amortization of deferred policy acquisition costs, (d) a $27,000 decrease in other revenues, and (e) a $4,000 decrease in funeral home at-need sales, which were partially offset by (i) a $305,000 increase in cemetery pre-need sales, (ii) a $231,000 increase in net investment income, (iii) a $133,000 increase in cemetery at-need sales, (iv) a $20,000 decrease in cost of goods and services sold, and (v) a $16,000 decrease in income tax expense, (vi) a $7,000 decrease in intersegment expenses.
Previous wording
The Company’s wholly owned subsidiary, SecurityNational Mortgage Company (“SecurityNational Mortgage), is a mortgage lender incorporated under the laws of the State of Utah and approved and regulated by the Federal Housing Administration (FHA), a department of the U.S. Department of Housing and Urban Development (HUD), which originates mortgage loans that qualify for government insurance in the event of default by the borrower, in addition to various conventional mortgage loan products. SecurityNational Mortgage originates and refinances mortgage loans on a retail basis. Mortgage loans originated or refinanced by the SecurityNational Mortgage are funded through loan purchase agreements with Security National Life, Kilpatrick Life and unaffiliated financial institutions.
Current wording
The Company’s wholly owned subsidiary, SecurityNational Mortgage Company (“SecurityNational Mortgage”), is a mortgage lender incorporated under the laws of the State of Utah and approved and regulated by the Federal Housing Administration (FHA), a department of the U.S. Department of Housing and Urban Development (HUD), which originates mortgage loans that qualify for government insurance in the event of default by the borrower, in addition to various conventional mortgage loan products. SecurityNational Mortgage originates and refinances mortgage loans on a retail basis. Mortgage loans originated or refinanced by SecurityNational Mortgage are funded through loan purchase agreements with Security National Life, Kilpatrick Life and unaffiliated financial institutions.
Previous wording
SecurityNational Mortgage receives fees from borrowers that are involved in mortgage loan originations and refinancings, and secondary fees earned from third party investors that purchase the mortgage loans. Mortgage loans are generally sold with mortgage servicing rights (“MSRs”) released to third-party investors or retained by SecurityNational Mortgage. SecurityNational Mortgage currently retains the mortgage servicing rights on approximately 0.43% of its loan origination volume. These mortgage loans are serviced by either SecurityNational Mortgage or an approved third-party sub-servicer.
Current wording
SecurityNational Mortgage receives fees from borrowers that are involved in mortgage loan originations and refinancings, and secondary fees earned from third party investors that purchase the mortgage loans. Mortgage loans are generally sold with mortgage servicing rights (“MSRs”) released to third-party investors or retained by SecurityNational Mortgage. SecurityNational Mortgage currently retains the mortgage servicing rights on approximately 2.04% of its loan origination volume. These mortgage loans are serviced by either SecurityNational Mortgage or an approved third-party sub-servicer.
Previous wording
For the nine-month periods ended September 30, 2025, and 2024, SecurityNational Mortgage originated 5,216 loans ($1,756,289,000 total volume) and 5,505 loans ($1,723,036,000 total volume), respectively.
Current wording
For the three-month periods ended March 31, 2026, and 2025, SecurityNational Mortgage originated 1,415 loans ($488,560,000 total loan volume principal amount) and 1,508 loans ($517,886,000 total loan volume principal amount), respectively.
Previous wording
The following table shows the condensed financial results of the mortgage operations for the three- and nine-month periods ended September 30, 2025, and 2024. See Note 7 to the condensed consolidated financial statements.
Current wording
The following table shows the condensed financial results of the mortgage operations for the three-month periods ended March 31, 2026, and 2025. See Note 16 to the condensed consolidated financial statements.
Previous wording
Total revenues increased by $1,052,000, or 1.2%, to $89,326,000 for the three-month period ended September 30, 2025, from $88,274,000 for the comparable period in 2024. Contributing to this increase in total revenues was a $2,310,000 increase in net investment income, a $624,000 increase in gains on investments and other assets, and a $327,000 increase in net mortuary and cemetery sales, which were partially offset by a $1,085,000 decrease in mortgage fee income, a $994,000 decrease in other revenues, and a $130,000 decrease in insurance premiums and other considerations.
Current wording
Total revenues decreased by $3,011,000, or 3.6%, to $79,729,000 for the three-month period ended March 31, 2026, from $82,740,000 for the comparable period in 2025. Contributing to this decrease in total revenues was a $1,319,000 decrease in mortgage fee income, a $924,000 decrease in insurance premiums and other considerations, a $701,000 decrease in net investment income, a $264,000 decrease in other revenues, and a $235,000 decrease in gains on investments and other assets, which were partially offset by a $434,000 increase in net funeral home and cemetery sales.
Previous wording
Mortgage fee income decreased by $1,085,000, or 3.6%, to $29,139,000, for the three-month period ended September 30, 2025, from $30,224,000 for the comparable period in 2024. This decrease was primarily due to a $3,163,000 decrease in the fair value of loans held for sale and a $509,000 decrease in income from loan originations, which were partially offset by a $2,396,000 increase in secondary gains from mortgage loans sold to third-party investors into the secondary market and a $191,000 increase in the fair value of loan commitments.
Current wording
Mortgage fee income decreased by $1,319,000, or 5.3%, to $23,490,000, for the three-month period ended March 31, 2026, from $24,809,000 for the comparable period in 2025. This decrease was primarily due to a $2,245,000 decrease in the fair value of loans held for sale and a $540,000 decrease in secondary gains from mortgage loans sold to third-party investors into the secondary market, which were partially offset by a $910,000 increase in the fair value of loan commitments and a $556,000 increase in income from loan originations.
Previous wording
Insurance premiums and other considerations decreased by $130,000, or 0.4%, to $29,881,000 for the three-month period ended September 30, 2025, from $30,011,000 for the comparable period in 2024. This decrease was primarily due to an increase of $557,000 in renewal premiums, which was partially offset by a decrease of $687,000 in first year premiums.
Current wording
Insurance premiums and other considerations decreased by $924,000, or 3.1%, to $28,855,000 for the three-month period ended March 31, 2026, from $29,779,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $966,000 in first year premiums, which was partially offset by an increase of $42,000 in renewal premiums.
Previous wording
Net investment income increased by $2,310,000, or 13.0%, to $20,109,000 for the three-month period ended September 30, 2025, from $17,799,000 for the comparable period in 2024. This increase was primarily attributable to a $3,117,000 increase in mortgage loan interest, a $517,000 increase in fixed maturity securities income, a $39,000 increase in equity securities income, and a $32,000 increase in policy loan interest, which were partially offset by a $953,000 decrease in interest on cash and cash equivalents, a $208,000 decrease in real estate income, a $137,000 increase in investment expenses, a $61,000 decrease in insurance assignment income, and a $36,000 decrease in other investment income.
Current wording
Net investment income decreased by $701,000, or 3.7%, to $18,501,000 for the three-month period ended March 31, 2026, from $19,202,000 for the comparable period in 2025. This decrease was primarily attributable to a $560,000 increase in investment expenses, a $355,000 decrease in interest on cash and cash equivalents, a $288,000 decrease in insurance assignment income, a $22,000 decrease in real estate income, and a $3,000 decrease in policy loan interest, which were partially offset by a $310,000 increase in mortgage loan interest, a $154,000 increase in other investment income, a $48,000 increase in fixed maturity securities income, and a $15,000 increase in equity securities income.
Previous wording
Net mortuary and cemetery sales increased by $167,000, or 0.8%, to $21,699,000 for the nine-month period ended September 30, 2025, from $21,532,000 for the comparable period in 2024. This increase was primarily due to a $516,000 increase in mortuary at-need sales, which were partially offset by a $240,000 decrease in cemetery pre-need sales and a $109,000 decrease in cemetery at-need sales.
Current wording
Net funeral home and cemetery sales increased by $434,000, or 5.9%, to $7,734,000 for the three-month period ended March 31, 2026, from $7,300,000 for the comparable period in 2025. This increase was primarily due to a $305,000 increase in cemetery pre-need sales and a $133,000 increase in cemetery at-need sales, which were partially offset by a $4,000 decrease in funeral home at-need sales.
Previous wording
Gains (losses) on investments and other assets increased by $624,000 to $1,972,000 in net gains for the three-month period ended September 30, 2025, from $1,348,000 in net gains for the comparable period in 2024. This increase in gains on investments and other assets was primarily due to a $1,161,000 increase in gains on mortgage loans held for investment and a $561,000 increase in gains on real estate, which were partially offset by a $929,000 decrease in gains on equity securities primarily attributable to decreases in the fair value of these equity securities, a $158,000 decrease in gains on other assets, and a $11,000 decrease in gains on fixed maturity securities.
Current wording
Gains (losses) on investments and other assets decreased by $235,000 to $351,000 in net gains for the three-month period ended March 31, 2026, from $586,000 in net gains for the comparable period in 2025. This decrease in gains on investments and other assets was primarily due to a $426,000 decrease in gains on equity securities primarily attributable to decreases in the fair value of these equity securities and a $21,000 decrease in gains on fixed maturity securities, which were partially offset by a $157,000 increase in gains on real estate and a $55,000 increase in gains on other assets.
Previous wording
Other revenues decreased by $994,000, or 47.8%, to $1,083,000 for the three-month period ended September 30, 2025, from $2,077,000 for the comparable period in 2024. This decrease was primarily due to a decrease of $994,000 in other miscellaneous revenues.
Current wording
Other revenues decreased by $264,000, or 24.9%, to $798,000 for the three-month period ended March 31, 2026, from $1,062,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $264,000 in other miscellaneous revenues.
Previous wording
Selling, general and administrative expenses increased by $9,399,000, or 7.3%, to $138,351,000 for the nine-month period ended September 30, 2025, from $128,952,000 for the comparable period in 2024. This increase was primarily the result of a $3,966,000 increase in personnel expenses due to an annual increase in salaries and key new hires as a part of the Company’s growth strategy, a $3,480,000 increase in other expenses, a $2,319,000 increase in commissions, a $443,000 increase in costs related to funding mortgage loans, a $366,000 increase in advertising expense, and a $30,000 increase in depreciation on property and equipment, which were partially offset by a $1,205,000 decrease in rent and rent related expenses.
Current wording
Selling, general and administrative expenses decreased by $2,936,000, or 6.7%, to $40,928,000 for the three-month period ended March 31, 2026, from $43,864,000 for the comparable period in 2025. This decrease was primarily the result of a $1,645,000 decrease in commissions, a $1,581,000 decrease in personnel expenses, a $166,000 decrease in rent and rent related expenses, an $87,000 decrease in advertising expense, and a $35,000 decrease in depreciation on property and equipment, which were partially offset by a $319,000 increase in other expenses and a $259,000 increase in costs related to funding mortgage loans.
Previous wording
Interest expense increased by $6,000, or 0.6%, to $1,067,000 for the three-month period ended September 30, 2025, from $1,061,000 for the comparable period in 2024. This increase was primarily due to an increase of $26,000 in interest expense on mortgage warehouse lines of credit for loans held for sale, which was partially offset by a decrease of $20,000 in interest expense on bank loans.
Current wording
Interest expense decreased by $123,000, or 11.0%, to $996,000 for the three-month period ended March 31, 2026, from $1,119,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $110,000 in interest expense on mortgage warehouse lines of credit for loans held for sale and a decrease of $13,000 in interest expense on bank loans.
Previous wording
The Company’s life insurance subsidiaries and cemetery and mortuary subsidiaries realize cash flow from premiums, contract payments and sales on personal services rendered for cemetery and mortuary business, from interest and dividends on invested assets, and from the proceeds from the sale or maturity of investments. The mortgage subsidiaries realize cash flow from fees generated by originating and refinancing mortgage loans and fees from mortgage loans held for sale that are sold to investors into the secondary market. It should be noted that current conditions in the financial markets and economy may affect the realization of these expected cash flows. The Company considers these sources of cash flow to be adequate to fund future policyholder and cemetery and mortuary liabilities, which generally are long-term, and adequate to pay current policyholder claims, annuity payments, expenses related to the issuance of new policies, the maintenance of existing policies, debt service, and to meet current operating expenses.
Current wording
The Company’s life insurance subsidiaries and funeral home and cemetery subsidiaries realize cash flow from premiums, contract payments and sales on personal services rendered for funeral home and cemetery business, from interest and dividends on invested assets, and from the proceeds from the sale or maturity of investments. The mortgage subsidiaries realize cash flow from fees generated by originating and refinancing mortgage loans and fees from mortgage loans held for sale that are sold to investors into the secondary market. It should be noted that current conditions in the financial markets and economy may affect the realization of these expected cash flows. The Company considers these sources of cash flow to be adequate to fund future policyholder and funeral home and cemetery liabilities, which generally are long-term, and adequate to pay current policyholder claims, annuity payments, expenses related to the issuance of new policies, the maintenance of existing policies, debt service, and to meet current operating expenses.
Previous wording
During the nine-month periods ended September 30, 2025, and 2024, the Company’s operations provided cash of approximately $27,553,000 and of approximately $34,894,000, respectively. The decrease in cash provided by operations was due primarily to the decrease in net earnings.
Current wording
During the three-month periods ended March 31, 2026, and 2025, the Company’s operations provided cash of approximately $32,940,000 and of approximately $9,586,000, respectively. The increase in cash provided by operations was due primarily to a decrease in originations of loans held for sale and an increase in net earnings.
Previous wording
The Company attempts to match the duration of invested assets with its policyholder and cemetery and mortuary liabilities. The Company may sell investments other than those held to maturity in the portfolio to help in this timing matching. The Company purchases short-term investments on a temporary basis to meet the expected short-term requirements of the Company’s insurance products. The Company’s investment philosophy is intended to provide a rate of return for the expected duration of its cemetery and mortuary policies that will exceed the accruing of liabilities under those policies regardless of future interest rate movements.
Current wording
The Company attempts to match the duration of invested assets with its policyholder and funeral home and cemetery liabilities. The Company may sell investments other than those held to maturity in the portfolio to help in this timing matching. The Company purchases short-term investments on a temporary basis to meet the expected short-term requirements of the Company’s insurance products. The Company’s investment philosophy is intended to provide a rate of return for the expected duration of its funeral home and cemetery policies that will exceed the accruing of liabilities under those policies regardless of future interest rate movements.
Previous wording
The Company’s investment policy is also to invest predominantly in fixed maturity securities, real estate, mortgage loans, and warehousing of mortgage loans. The warehoused mortgage loans are typically held for sale on a short-term basis before selling the loans to investors in accordance with the requirements and laws governing the Company’s life insurance subsidiaries. Bonds owned by the insurance subsidiaries amounted to $370,953,000 (at estimated fair value) and $348,774,000 (at estimated fair value) as of September 30, 2025, and December 31, 2024, respectively. This represented 35.4% and 38.0% of the total investments of the Company as of September 30, 2025, and December 31, 2024, respectively. Generally, all bonds owned by the life insurance subsidiaries are rated by the National Association of Insurance Commissioners. Under this rating system, there are six categories used for the rating of bonds. As of September 30, 2025, 1.6% (or $5,882,000) and as of December 31, 2024, 2.4% (or $8,431,000) of the Company’s total bond investments were invested in bonds in rating categories three through six, which are considered non-investment grade.
Current wording
The Company’s investment policy is also to invest predominantly in fixed maturity securities, real estate, mortgage loans, and warehousing of mortgage loans. The warehoused mortgage loans are typically held for sale on a short-term basis before selling the loans to investors in accordance with the requirements and laws governing the Company’s life insurance subsidiaries. Bonds owned by the insurance subsidiaries amounted to $350,683,000 (at estimated fair value) and $365,986,000 (at estimated fair value) as of March 31, 2026, and December 31, 2025, respectively. This represented 34.2% and 35.2% of the total investments of the Company as of March 31, 2026, and December 31, 2025, respectively. Generally, all bonds owned by the life insurance subsidiaries are rated by the National Association of Insurance Commissioners. Under this rating system, there are six categories used for the rating of bonds. As of March 31, 2026, 1.7% (or $5,945,000) and as of December 31, 2025, 1.6% (or $5,825,000) of the Company’s total bond investments were invested in bonds in rating categories three through six, which are considered non-investment grade.
Previous wording
The Company’s total capitalization of stockholders’ equity, bank and other loans payable was $488,478,000 as of September 30, 2025, as compared to $445,522,000 as of December 31, 2024. This increase was primarily due to an increase of $26,600,000 in stockholders’ equity and an increase of $16,356,000 in bank loans and other loans payable. Stockholders’ equity as a percent of total capitalization was 74.8% and 76.1% as of September 30, 2025, and December 31, 2024, respectively.
Current wording
The Company’s total capitalization of stockholders’ equity, bank and other loans payable was $534,276,000 as of March 31, 2026, as compared to $508,757,000 as of December 31, 2025. This increase was primarily due to an increase of $15,147,000 in stockholders’ equity and an increase of $10,372,000 in bank loans and other loans payable. Stockholders’ equity as a percentage of total capitalization was 79.6% and 80.7% as of March 31, 2026, and December 31, 2025, respectively.
Previous wording
Lapse rates measure the amount of insurance terminated during a particular period. The Company’s lapse rate for life insurance in 2024 was 7.0% as compared to a lapse rate of 4.4% for 2023. The 2025 lapse rate to date has been approximately the same as 2024.
Current wording
Lapse rates measure the amount of insurance terminated during a particular period. The Company’s lapse rate for life insurance in 2025 was 7.2% as compared to a lapse rate of 7.0% for 2024. The 2026 lapse rate to date has been approximately the same as 2025.
Previous wording
The combined statutory capital and surplus of the Company’s life insurance subsidiaries was approximately $133,949,000 and $120,216,000 as of September 30, 2025, and December 31, 2024, respectively. The life insurance subsidiaries cannot pay a dividend to their parent company without the approval of state insurance regulatory authorities.
Current wording
The combined statutory capital and surplus of the Company’s life insurance subsidiaries was approximately $140,204,000 and $139,068,000 as of March 31, 2026, and December 31, 2025, respectively. The life insurance subsidiaries cannot pay a dividend to their parent company without the approval of state insurance regulatory authorities.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Net investment income increased by $4,103,000, or 7.4%, to $59,893,000 for the nine-month period ended September 30, 2025, from $55,790,000 for the comparable period in 2024. This increase was primarily attributable to a $7,704,000 increase in mortgage loan interest, a $1,183,000 increase in fixed maturity securities income, a $847,000 increase in insurance assignment income, a $134,000 increase in equity securities income, and a $21,000 increase in policy loan interest which were partially offset by a $2,415,000 increase in investment expenses, a $2,004,000 decrease in interest on cash and cash equivalents, a $1,175,000 decrease in real estate income, and a $192,000 decrease in other investment income.
Previous report — wording carried elsewhere
Gains (losses) on investments and other assets increased by $1,061,000, or 40.2% to $3,701,000 for the nine-month period ended September 30, 2025, from $2,640,000 for the comparable period in 2024. This increase in gains on investments and other assets was primarily due to a $1,161,000 increase in gains on mortgage loans held for investment, a $869,000 increase in gains on real estate, and a $6,000 increase in gains on fixed maturity securities, which were partially offset by a $833,000 decrease in gains on equity securities primarily attributable to decreases in the fair value of these equity securities and a $142,000 decrease in gains on other assets.