QUALITY IS THE BEST BUSINESS PLAN. TABLE OF CONTENTS 3 MESSAGE FROM THE PRESIDENT SFBLIC BOARD OF DIRECTORS 5 MESSAGE FROM THE CEO

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2 OUR MISSION Our mission is to be the life insurance company of choice for our Farm Bureau family. Our focus is to provide competitive products and superior customer service to our Farm Bureau policyholders and agents, while observing the highest ethical standards. HELPING YOU IS WHAT WE DO BEST 1

3 TABLE OF CONTENTS 3 MESSAGE FROM THE PRESIDENT SFBLIC BOARD OF DIRECTORS 5 MESSAGE FROM THE CEO 6 MESSAGE FROM THE SENIOR VICE PRESIDENT OF MARKETING 8 FINANCIAL HIGHLIGHTS 9 STATUTORY STATEMENTS OF FINANCIAL POSITION 11 STATUTORY STATEMENTS OF OPERATIONS 13 STATUTORY STATEMENTS OF STOCKHOLDERS EQUITY AND USES OF INCOME 14 OFFICERS QUALITY IS THE BEST BUSINESS PLAN. JOHN LASSETER 2

4 MESSAGE FROM THE PRESIDENT Few things carry the value of a friend for life, something we understand and embrace at Southern Farm Bureau Life Insurance Company. Friends for life share a commitment to things mutually important to them. Those may be beliefs, principles, aspirations or fears, even a common sense of humor or a community bond. Lifelong friends often turn out to be far more alike than they are different, and the longer they are friends the more similar they seem to become. One of my favorite Christian authors is C.S. Lewis. He said, FRIENDSHIP IS BORN AT THE MOMENT WHEN ONE PERSON SAYS TO ANOTHER, WHAT? YOU TOO? I THOUGHT I WAS THE ONLY ONE. Lewis also said what draws people to be friends is that they see the same truth, and they share it. While our favorite sports teams, tractor color and tastes in music may be different, those things are not the foundation of lifelong trust and respect (though, admittedly, the passion for some sports teams can seem pretty important at times, tractor color, too!) My deepest friends are not afraid to share hard truths, when needed. Those friends value me more than our friendship, which is meaningful. That can sometimes make for challenging conversations, but it ultimately makes our friendship stronger than before. A friend for life is invaluable. When you are fortunate to realize that, you can count yourself blessed. So, I hope as you consider your relationship with Southern Farm Bureau Life, you see a friend for life who shares many of the same beliefs as you, as well as common principles, aspirations and even fears. I hope you see someone who can talk bluntly, but caringly and someone who shares the truth with you regularly. God bless you and your families. God bless Southern Farm Bureau Life. And God bless lifelong friends. RANDY VEACH CHAIRMAN OF THE BOARD AND PRESIDENT Southern Farm Bureau Life Insurance Company 3

5 BOARD OF DIRECTORS FRONT ROW///Gerald Long (GA), Jim Harper (LA), Scott Whitford (NC), Randy Veach (AR), Wayne Pryor (VA), Scott Sink (VA), Harry Ott (SC) MIDDLE ROW///Larry Wooten (NC), Ronald Anderson (LA), Brant Schirard (FL), Rich Hillman (AR), Mike McCormick (MS), Robert Fountain (GA), Michael White (TX) BACK ROW///Russell Boening (TX), John Hoblick (FL), Mark Haney (KY), Eddie Melton (KY), William Coleman (SC), Reggie Magee (MS) 4

6 MESSAGE FROM THE CEO When thinking about a friend for life, certain words come to mind: kindness, loyalty, dedication, and trust. If you spend time around the employees and agents of Southern Farm Bureau Life Insurance Company, you will understand the true meaning of this year s theme, Your Friends for Life. Our agents and home office staff are determined to help protect our Farm Bureau families by providing financial security, and this dedication and determination cultivates the relationships we have with our Farm Bureau members. Since 1946, we have focused on serving our Farm Bureau families, and have developed a financially strong Company for their protection. In the ever-changing landscape of the life insurance industry, our agents and home office staff are adapting and evolving their business operations with new and efficient processes. Southern Farm Bureau Life Insurance Company continues to be a strong, dependable Company, and a leading force among our peers. It gives me great pleasure to report that 2017 was another remarkable year for Southern Farm Bureau Life Insurance Company. While upholding a reputation of exceptional customer service, we continued to build upon our history of financial stability. We ended the year with $144 billion of life insurance in force and provided $280 million ($251 million net) in death benefits and $559 million in living benefits to our policyholders. Along with these accomplishments, the Company retained its A+ (Superior) financial strength rating from A.M. Best. Through our constant dedication and loyalty, we will strive to maintain your trust and always be Your Friends for Life. RANDY JOHNS, FLMI, ACS EXECUTIVE VICE PRESIDENT, CHIEF EXECUTIVE OFFICER Southern Farm Bureau Life Insurance Company 5

7 MESSAGE FROM THE SENIOR VICE PRESIDENT OF MARKETING As we reflect on 2017, the entire industry had a challenging year in production. Our sales leveled off; however, our overall in-force volume increased by 4.64%. We finished 2017 with over $144 billion of total life insurance in force. That says a lot about the strength of our culture and our people, and I think that helps differentiate our Company from the competition. Looking forward, we know that we want to continue to set the bar high, and we expect to be different in ways that are beneficial to our policyholders. Our field force has an amazing, yet tremendous responsibility to protect their clients hopes and dreams every day. Securing our policyholders trust and creating lasting relationships are essential to our continued success. We pride ourselves on our commitment to service, and we genuinely exemplify the tagline Your Friends for Life. We have embarked on a new historic goal in 2018 to reach and surpass $150 billion of total life insurance in force. We face many challenges in our industry, but we believe we are poised to accomplish great things in the future. We trust this belief because our people are the heartbeat of this organization and we have confidence in our field force. Our field force is our greatest strength and our greatest asset. Protecting people from financial hardships is the foundation on which our Company was built. The benchmark of our success is our unrelenting commitment to personal service, and as we strive for success, we want to continue to be your friend for life. Our Board of Directors, home office employees, field force, and sales management all recognize how essential it is to maintain a financially strong, viable Company to uphold the promises we deliver every day. It is truly a blessing to serve our people and this amazing organization! DAVID HURT, LUTCF SENIOR VICE PRESIDENT, MARKETING Southern Farm Bureau Life Insurance Company 6

8 7 WHO WILL TAKE CARE OF THEM WHEN YOU ARE GONE? WE WILL.

9 FINANCIAL HIGHLIGHTS DECEMBER 31, 2017 DECEMBER 31, 2016 LIFE INSURANCE IN FORCE $144,421,167,109 $138,026,099,824 ADMITTED ASSETS $14,191,659,486 $13,926,215,441 TOTAL STOCKHOLDERS EQUITY $2,558,702,454 $ 2,537,350,315 PREMIUM INCOME $885,974,397 $968,551,751 INVESTMENT INCOME $581,376,868 $575,288,877 ADDED TO RETAINED EARNINGS $21,352,139 $80,505,325 BENEFITS TO POLICYHOLDERS $838,884,634 $831,678, LIFE INSURANCE IN FORCE $144,421,167,109 $138,026,099,824 ADMITTED ASSETS $14,191,659,486 $13,926,215,441 TOTAL STOCKHOLDERS EQUITY $2,558,702,454 $2,537,350,315 8

10 STATUTORY STATEMENTS OF FINANCIAL POSITION ADMITTED ASSETS DECEMBER 31, 2017 DECEMBER 31, 2016 BONDS AT AMORTIZED COST $9,893,968,740 $9,793,536,040 PREFERRED STOCK AT COST 36,468,102 32,810,459 COMMON STOCK AT MARKET 662,037, ,048,351 MORTGAGE LOANS 1,787,963,591 1,601,796,136 REAL ESTATE AT COST LESS DEPRECIATION 16,951,635 15,892,692 PARTNERSHIP INTERESTS 589,325, ,932,833 CASH, CASH EQUIVALENTS, & SHORT-TERM INVESTMENTS 112,614, ,702,480 POLICY LOANS 540,289, ,465,855 DEFERRED INCOME TAXES 75,469, ,309,835 PREMIUMS DEFERRED & UNCOLLECTED 285,122, ,929,958 ACCRUED INVESTMENT INCOME 115,375, ,994,859 OTHER ASSETS 57,923,261 57,735,765 SEPARATE ACCOUNT ASSETS 18,148,073 17,060,178 TOTAL ADMITTED ASSETS $14,191,659,486 $13,926,215,441 These summary financial statements are derived from the Company s audited financial statements, which are prepared in conformity with statutory insurance accounting principles prescribed or permitted by the Insurance Department, State of Mississippi. 9

11 STATUTORY STATEMENTS OF FINANCIAL POSITION LIABILITIES DECEMBER 31, 2017 DECEMBER 31, 2016 POLICY RESERVES $10,153,339,680 $9,893,890,113 POLICY AND CONTRACT CLAIMS 35,461,483 36,215,776 ADVANCED PREMIUMS AND FUNDS ON DEPOSIT 23,133,629 22,864,897 ACCRUED POLICY DIVIDENDS 52,457,421 50,270,103 DIVIDENDS LEFT ON DEPOSIT 250,870, ,007,588 PENSION PLAN ADMINISTRATION FUNDS 641,044, ,288,081 TAXES OTHER THAN FEDERAL INCOME TAX 7,410,035 7,320,647 COMMISSIONS & DUE TO AFFILIATES 13,804,321 13,831,917 OTHER LIABILITIES 196,330, ,633,840 ASSET VALUATION RESERVE 240,957, ,481,986 SEPARATE ACCOUNT LIABILITIES 18,148,073 17,060,178 TOTAL LIABILITIES $11,632,957,032 $11,388,865,126 STOCKHOLDERS EQUITY DECEMBER 31, 2017 DECEMBER 31, 2016 COMMON $100 PAR VALUE, AUTHORIZED 20,000 SHARES; ISSUED AND OUTSTANDING 15,000 SHARES $1,500,000 $1,500,000 PAID-IN CAPITAL IN EXCESS OF PAR 400, ,000 RETAINED EARNINGS 2,556,802,454 2,535,450,315 TOTAL STOCKHOLDERS EQUITY 2,558,702,454 2,537,350,315 TOTAL LIABILITIES AND STOCKHOLDERS EQUITY $14,191,659,486 $13,926,215,441 10

12 STATUTORY STATEMENTS OF OPERATIONS FOR THE YEARS ENDING REVENUE DECEMBER 31, 2017 DECEMBER 31, 2016 LIFE PREMIUMS $757,210,004 $741,377,925 ANNUITY PREMIUMS 114,692, ,761,468 ACCIDENT & HEALTH PREMIUMS 14,071,768 14,412,358 SUPPLEMENTARY CONTRACTS 18,296,871 20,756,125 INVESTMENT INCOME 581,376, ,288,877 OTHER REVENUE 2,313,293 2,293,533 TOTAL REVENUE $1,487,961,429 $1,566,890,286 POLICY BENEFITS & EXPENSES DECEMBER 31, 2017 DECEMBER 31, 2016 DEATH BENEFITS $251,771,466 $255,891,520 ACCIDENT & HEALTH BENEFITS 11,840,122 10,939,012 SURRENDER & OTHER LIFE BENEFITS 148,791, ,315,900 ANNUITY BENEFITS 315,936, ,845,643 AMOUNTS ADDED TO POLICY RESERVES HELD FOR POLICYHOLDERS 250,745, ,040,652 INTEREST ON POLICY AND CONTRACT FUNDS 38,778,261 39,314,227 PAYMENTS ON SUPPLEMENTARY CONTRACTS 21,076,142 20,636,814 COMMISSIONS 78,603,353 79,594,107 GENERAL INSURANCE EXPENSES 169,455, ,657,676 TAXES, LICENSES, FEES 26,135,306 24,924,976 TOTAL POLICY BENEFITS & EXPENSES $1,313,134,622 $1,419,160,527 NET GAIN FROM OPERATIONS BEFORE DIVIDENDS AND FEDERAL INCOME TAX 174,826, ,729,759 DIVIDENDS TO POLICYHOLDERS 50,690,145 48,735,225 NET GAIN FROM OPERATIONS BEFORE FEDERAL INCOME TAX 124,136,662 98,994,534 FEDERAL INCOME TAX 30,050,000 21,075,000 NET GAIN FROM OPERATIONS $94,086,662 $77,919,534 11

13 YOUR FAMILY SHOULD LIVE HAPPILY EVER AFTER...YOU. 12

14 STATUTORY STATEMENTS OF STOCKHOLDERS EQUITY DECEMBER 31, 2017 DECEMBER 31, 2016 COMMON STOCK $1,500,000 $1,500,000 PAID-IN CAPITAL IN EXCESS OF PAR 400, ,000 TOTAL COMMON STOCK $1,900,000 $1,900,000 RETAINED EARNINGS BALANCE AT BEGINNING OF YEAR $2,535,450,315 $2,454,944,990 NET GAIN FROM OPERATIONS 94,086,662 77,919,534 REALIZED & UNREALIZED CAPITAL GAINS, NET 48,058,840 36,709,867 CHANGE IN ASSET VALUATION RESERVE (7,475,429) (53,707,589) DIVIDENDS TO STOCKHOLDERS (45,000,000) (90,000) OTHER (68,317,934) 19,673,513 TOTAL RETAINED EARNINGS $2,556,802,454 $2,535,450,315 TOTAL STOCKHOLDERS EQUITY $2,558,702,454 $2,537,350,315 USES OF INCOME DECEMBER 31, 2017 DECEMBER 31, 2016 ADDED TO POLICYHOLDER RESERVES POLICYHOLDERS DIVIDENDS DEATH BENEFITS SURRENDER & OTHER LIVING BENEFITS FOR BENEFIT OF POLICYHOLDER $ $.76 COMMISSIONS GENERAL EXPENSES LICENSES & TAXES NET GAIN - ADDED TO RETAINED EARNINGS OTHER USES $.27 $.24 13

15 OFFICERS RANDY VEACH CHAIRMAN OF THE BOARD /// PRESIDENT WAYNE PRYOR /// FIRST VICE PRESIDENT RANDY JOHNS, FLMI, ACS EXECUTIVE VICE PRESIDENT /// CHIEF EXECUTIVE OFFICER H. LUSBY BROWN, CFA SENIOR VICE PRESIDENT /// CHIEF INVESTMENT OFFICER STAN DICKENS, FSA, MAAA, FLMI SENIOR VICE PRESIDENT /// CHIEF ACTUARY DAVID HURT, LUTCF SENIOR VICE PRESIDENT /// MARKETING JOSEPH A. PURVIS, FLMI, AIRC SENIOR VICE PRESIDENT /// GENERAL COUNSEL & SECRETARY BILLY SIMS, FLMI, SPHR, CCP, CBP SENIOR VICE PRESIDENT /// POLICY ADMINISTRATION ROBERT WARD, CPA, CLU, FLMI, CIA, CFE SENIOR VICE PRESIDENT /// CHIEF FINANCIAL OFFICER CHARLIE ALLEN, FLMI, ACS, AIAA VICE PRESIDENT, CHIEF TECHNOLOGY OFFICER NANCY BAKER, FLMI, FLHC, ACS VICE PRESIDENT, CLAIMS DIANE BOYETTE, JD VICE PRESIDENT, CHIEF COMPLIANCE OFFICER DAVID N. DUDDLESTON, M.D. VICE PRESIDENT, MEDICAL DIRECTOR BENGIE GOFF, LUTCF, CLF VICE PRESIDENT, AGENCY SHELIA R. HUDSON, CIA, CFE, CFSA, CLU VICE PRESIDENT, INTERNAL AUDITING LAURA HUMPHRIES, CLU, CLF, FLMI, ALHC, ACS VICE PRESIDENT, POLICY SERVICES HARPER KEELER VICE PRESIDENT, REALTY INVESTMENTS ROBERT LUCKADOO, LUTCF, CLU VICE PRESIDENT, SALES AND TRAINING CATHY MARTIN, FSA VICE PRESIDENT, GROUP ADMINISTRATION AND APPOINTED ACTUARY PERRY MCGAUGH VICE PRESIDENT, LEGAL AND ASSISTANT SECRETARY RICK MCKISSACK, FLMI, PMP VICE PRESIDENT, MARKETING DATA AND E-SERVICES JOYCE PLUNKETT, FLMI, ACS, PHR VICE PRESIDENT, HUMAN RESOURCES DOUG REDMAN, FSA VICE PRESIDENT, PENSION ADMINISTRATION AND CHIEF RISK OFFICER DAVID SIMMONDS, CPA, ASA, FLMI VICE PRESIDENT, CONTROLLER JEREMY WESSON, ACS, FLMI, FALU, CLU VICE PRESIDENT, UNDERWRITING AND NEW BUSINESS ADMINISTRATION 14

16 Southern Farm Bureau Life Insurance Company P.O. Box 78 Jackson, Mississippi (601)