Farm and Home Mutual Insurance Company

Transcription

1 QUARTERLY STATEMENT of Paragould in the state of Arkansas 2017 TO THE Insurance Department STATE OF Arkansas FOR THE QUARTER ENDED MARCH 31, 2017 PROPERTY AND CASUALTY 2017

2 PROPERTY AND CASUALTY COMPANIES - ASSOCIATION EDITION QUARTERLY STATEMENT AS OF MARCH 31, 2017 CONDITION AND AFFAIRS Document Code: 201 NAIC Group Code 0000, 0000 NAIC Company Code Employer s ID Number (Current Period) (Prior Period) Organized under the Laws of Arkansas, State of Domicile or Port of Entry AR Country of Domicile United States of America Incorporated/Organized 01/01/1949 Commenced Business 01/01/1966 Statutory Home Office 1201 West Court Street, Paragould, AR, US (Street and Number) (City or Town, State, Country and Zip Code) Main Administrative Office 1201 West Court Street (Street and Number) Paragould, AR, US (870) (City or Town, State, Country and Zip Code) (Area Code) (Telephone Number) Mail Address P.O. Box 1546, Paragould, AR, US (Street and Number or P.O. Box) (City or Town, State, Country and Zip Code) Primary Location of Books and Records 1201 West Court Street (Street and Number) Paragould, AR, US (870) (City or Town, State, Country and Zip Code) (Area Code) (Telephone Number) Internet Web Site Address Statutory Statement Contact Chandra L McGowan (870) (Name) (Area Code)(Telephone Number)(Extension) cmcgowan@unitedhomeins.com (870) ( Address) (Fax Number) OFFICERS Kelly Lewis Ford Matthew Stephen Miller Michael Ray Cline Name William Kyle Harris Kelly Lewis Ford Matthew Stephen Miller Matthew Stephen Miller OTHERS Title President Vice-President Treasurer Secretary DIRECTORS OR TRUSTEES William Kyle Harris Michael Thomas Harris State of Arkansas County of Greene ss The officers of this reporting entity being duly sworn, each depose and say that they are the described officers of said reporting entity, and that on the reporting period stated above, all of the herein described assets were the absolute property of the said reporting entity, free and clear from any liens or claims thereon, except as herein stated, and that this statement, together with related exhibits, schedules and explanations therein contained, annexed or referred to, is a full and true statement of all the assets and liabilities and of the condition and affairs of the said reporting entity as of the reporting period stated above, and of its income and deductions therefrom for the period ended, and have been completed in accordance with the NAIC Annual Statement Instructions and Accounting Practices and Procedures manual except to the extent that: (1) state law may differ; or, (2) that state rules or regulations require differences in reporting not related to accounting practices and procedures, according to the best of their information, knowledge and belief, respectively. Furthermore, the scope of this attestation by the described officers also includes the related corresponding electronic filing with the NAIC, when required, that is an exact copy (except for formatting differences due to electronic filing) of the enclosed statement. The electronic filing may be requested by various regulators in lieu of or in addition to the enclosed statement. (Signature) (Signature) (Signature) William Kyle Harris Matthew Stephen Miller Matthew Stephen Miller (Printed Name) (Printed Name) (Printed Name) President Secretary Treasurer (Title) (Title) (Title) Subscribed and sworn to before me this a. Is this an original filing? Yes[X] No[ ] day of, 2017 b. If no, 1. State the amendment number 2. Date filed 3. Number of pages attached (Notary Public Signature)

3 Q2 STATEMENT AS OF ASSETS Current Statement Date Net Admitted December 31 Nonadmitted Assets Prior Year Net Assets Assets (Cols. 1-2) Admitted Assets 1. Bonds ,472, ,472, ,407, Stocks: 2.1 Preferred stocks Common stocks Mortgage loans on real estate: 3.1 First liens Other than first liens Real estate: 4.1 Properties occupied by the company (less $...0 encumbrances) Properties held for the production of income (less $...0 encumbrances) Properties held for sale (less $...0 encumbrances) Cash ($...2,107,338), cash equivalents ($...0) and short-term investments ($...0) ,107, ,107, ,876, Contract loans (including $...0 premium notes) Derivatives Other invested assets Receivables for securities Securities lending reinvested collateral assets Aggregate write-ins for invested assets Subtotals, cash and invested assets (Lines 1 to 11) ,580, ,580, ,284, Title plants less $...0 charged off (for Title insurers only) Investment income due and accrued , , , Premiums and considerations: 15.1 Uncollected premiums and agents balances in the course of collection , , , Deferred premiums, agents balances and installments booked but deferred and not yet due (including $...0 earned but unbilled premiums) Accrued retrospective premiums ($...0) and contracts subject to redetermination ($...0) Reinsurance: 16.1 Amounts recoverable from reinsurers , , , Funds held by or deposited with reinsured companies Other amounts receivable under reinsurance contracts Amounts receivable relating to uninsured plans Current federal and foreign income tax recoverable and interest thereon , , , Net deferred tax asset , , , Guaranty funds receivable or on deposit Electronic data processing equipment and software Furniture and equipment, including health care delivery assets ($...0) Net adjustments in assets and liabilities due to foreign exchange rates Receivables from parent, subsidiaries and affiliates Health care ($...0) and other amounts receivable Aggregate write-ins for other-than-invested assets TOTAL assets excluding Separate Accounts, Segregated Accounts and Protected Cell Accounts (Lines 12 to 25) ,924, ,923, ,604, From Separate Accounts, Segregated Accounts and Protected Cell Accounts TOTAL (Lines 26 and 27) ,924, ,923, ,604,441 DETAILS OF WRITE-INS Summary of remaining write-ins for Line 11 from overflow page TOTALS (Lines 1101 through 1103 plus 1198) (Line 11 above) Summary of remaining write-ins for Line 25 from overflow page TOTALS (Lines 2501 through 2503 plus 2598) (Line 25 above)

4 Q3 STATEMENT AS OF LIABILITIES, SURPLUS AND OTHER FUNDS 1 2 Current December 31, Statement Date Prior Year 1. Losses (current accident year $...834,685) ,089, , Reinsurance payable on paid losses and loss adjustment expenses Loss adjustment expenses , , Commissions payable, contingent commissions and other similar charges , , Other expenses (excluding taxes, licenses and fees) Taxes, licenses and fees (excluding federal and foreign income taxes) Current federal and foreign income taxes (including $...0 on realized capital gains (losses)) Net deferred tax liability Borrowed money $...0 and interest thereon $ Unearned premiums (after deducting unearned premiums for ceded reinsurance of $...0 and including warranty reserves of $...0 and accrued accident and health experience rating refunds including $...0 for medical loss ratio rebate per the Public Health Service Act) ,454, ,457, Advance premium , , Dividends declared and unpaid: 11.1 Stockholders Policyholders Ceded reinsurance premiums payable (net of ceding commissions) Funds held by company under reinsurance treaties Amounts withheld or retained by company for account of others Remittances and items not allocated Provision for reinsurance (including $...0 certified) Net adjustments in assets and liabilities due to foreign exchange rates Drafts outstanding Payable to parent, subsidiaries and affiliates , , Derivatives Payable for securities Payable for securities lending Liability for amounts held under uninsured plans Capital notes $...0 and interest thereon $ Aggregate write-ins for liabilities TOTAL liabilities excluding protected cell liabilities (Lines 1 through 25) ,928, ,687, Protected cell liabilities TOTAL liabilities (Lines 26 and 27) ,928, ,687, Aggregate write-ins for special surplus funds Common capital stock Preferred capital stock Aggregate write-ins for other-than-special surplus funds Surplus notes Gross paid in and contributed surplus Unassigned funds (surplus).. 3,995, ,916, Less treasury stock, at cost: shares common (value included in Line 30 $...0) shares preferred (value included in Line 31 $...0) Surplus as regards policyholders (Lines 29 to 35, less 36) ,995, ,916, TOTALS (Page 2, Line 28, Col. 3) ,923, ,604,441 DETAILS OF WRITE-INS Summary of remaining write-ins for Line 25 from overflow page TOTALS (Lines 2501 through 2503 plus 2598) (Line 25 above) Adjustment Summary of remaining write-ins for Line 29 from overflow page TOTALS (Lines 2901 through 2903 plus 2998) (Line 29 above) Summary of remaining write-ins for Line 32 from overflow page TOTALS (Lines 3201 through 3203 plus 3298) (Line 32 above)

5 Q4 STATEMENT AS OF STATEMENT OF INCOME Current Year Prior Year Prior Year Ended to Date to Date December 31 UNDERWRITING INCOME 1. Premiums earned 1.1 Direct (written $...1,198,391) ,201, ,150, ,746, Assumed (written $...0) Ceded (written $...0) , , , Net (written $...1,198,391) ,131, ,087, ,476,543 DEDUCTIONS: 2. Losses incurred (current accident year $...0) 2.1 Direct. 746, , ,110, Assumed Ceded. 37, , , Net , , ,976, Loss adjustment expenses incurred , , , Other underwriting expenses incurred , , ,492, Aggregate write-ins for underwriting deductions TOTAL underwriting deductions (Lines 2 through 5) ,126, ,048, ,645, Net income of protected cells Net underwriting gain or (loss) (Line 1 minus Line 6 + Line 7) , , ,329 INVESTMENT INCOME 9. Net investment income earned , , , Net realized capital gains (losses) less capital gains tax of $ Net investment gain (loss) (Lines ) , , ,912 OTHER INCOME 12. Net gain or (loss) from agents or premium balances charged off (amount recovered $...0 amount charged off $...0) Finance and service charges not included in premiums , , , Aggregate write-ins for miscellaneous income TOTAL other income (Lines 12 through 14) , , , Net income before dividends to policyholders, after capital gains tax and before all other federal and foreign income taxes (Lines ) , , ,189, Dividends to policyholders Net income, after dividends to policyholders, after capital gains tax and before all other federal and foreign income taxes (Line 16 minus Line 17) , , ,189, Federal and foreign income taxes incurred , , , Net income (Line 18 minus Line 19) (to Line 22) , , ,138 CAPITAL AND SURPLUS ACCOUNT 21. Surplus as regards policyholders, December 31 prior year ,916, ,091, ,091, Net income (from Line 20) , , , Net transfers (to) from Protected Cell accounts Change in net unrealized capital gains or (losses) less capital gains tax of $ Change in net unrealized foreign exchange capital gain (loss) Change in net deferred income tax (1,232) , , Change in nonadmitted assets , Change in provision for reinsurance Change in surplus notes Surplus (contributed to) withdrawn from Protected cells Cumulative effect of changes in accounting principles Capital changes: 32.1 Paid in Transferred from surplus (Stock Dividend) Transferred to surplus Surplus adjustments: 33.1 Paid in Transferred to capital (Stock Dividend) Transferred from capital Net remittances from or (to) Home Office Dividends to stockholders Change in treasury stock Aggregate write-ins for gains and losses in surplus Change in surplus as regards policyholders (Lines 22 through 37) , , , Surplus as regards policyholders, as of statement date (Lines 21 plus 38) ,995, ,183, ,916,687 DETAILS OF WRITE-INS Summary of remaining write-ins for Line 5 from overflow page TOTALS (Lines 0501 through 0503 plus 0598) (Line 5 above) Summary of remaining write-ins for Line 14 from overflow page TOTALS (Lines 1401 through 1403 plus 1498) (Line 14 above) Correction of Prior Period DTA Federal Tax Adjustment for Prior Period Adjustment to surplus Summary of remaining write-ins for Line 37 from overflow page TOTALS (Lines 3701 through 3703 plus 3798) (Line 37 above)

6 Q5 STATEMENT AS OF CASH FLOW Current Prior Prior Year Year Year Ended To Date To Date December 31 Cash from Operations 1. Premiums collected net of reinsurance ,180, ,128, ,590, Net investment income , , , Miscellaneous income , , , TOTAL (Lines 1 to 3) ,277, ,211, ,944, Benefit and loss related payments , , ,987, Net transfers to Separate Accounts, Segregated Accounts and Protected Cell Accounts Commissions, expenses paid and aggregate write-ins for deductions , , ,652, Dividends paid to policyholders Federal and foreign income taxes paid (recovered) net of $...0 tax on capital gains (losses) , TOTAL (Lines 5 through 9) , , ,050, Net cash from operations (Line 4 minus Line 10) , , ,339 Cash from Investments 12. Proceeds from investments sold, matured or repaid: 12.1 Bonds , , Stocks Mortgage loans Real estate Other invested assets Net gains or (losses) on cash, cash equivalents and short-term investments Miscellaneous proceeds TOTAL investment proceeds (Lines 12.1 to 12.7) , , Cost of investments acquired (long-term only): 13.1 Bonds , , ,186, Stocks Mortgage loans Real estate Other invested assets Miscellaneous applications TOTAL investments acquired (Lines 13.1 to 13.6) , , ,187, Net increase (or decrease) in contract loans and premium notes Net cash from investments (Line 12.8 minus Line 13.7 and Line 14) (66,303) (406,059) (987,130) Cash from Financing and Miscellaneous Sources 16. Cash provided (applied): 16.1 Surplus notes, capital notes Capital and paid in surplus, less treasury stock Borrowed funds Net deposits on deposit-type contracts and other insurance liabilities Dividends to stockholders Other cash provided (applied) (60,506) , , Net cash from financing and miscellaneous sources (Line 16.1 through 16.4 minus Line 16.5 plus Line 16.6) (60,506) , ,809 RECONCILIATION OF CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS 18. Net change in cash, cash equivalents and short-term investments (Line 11, plus Lines 15 and 17) , , (9,982) 19. Cash, cash equivalents and short-term investments: 19.1 Beginning of year ,876, ,886, ,886, End of period (Line 18 plus Line 19.1) ,107, ,967, ,876,537 Note: Supplemental Disclosures of Cash Flow Information for Non-Cash Transactions:

7 1. Summary of Significant Accounting Policies A. Accounting Practices Notes to Financial Statement A. The financial statements of United Home Insurance Company are presented on the basis of accounting practices prescribed or permitted by the Arkansas Insurance Department. The National Association of Insurance Commissioners Accounting Practices and Procedures Manual has been adopted as a component of prescribed or permitted practices by the state of Arkansas. B. The preparation of financial statements in conformity with Statutory Accounting Principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities. It also requires disclosure of contingent assets and liabilities at the date of financial statements and reported amounts of revenue and expenses during the period. Actual results could differ from those estimates. C. Premiums are earned over the terms of the related insurance policies and reinsurance contracts. Unearned premium reserves are established to cover the unexpired portion of premiums written. Such reserves are computed by pro rata methods for direct business and are based on reports received from ceding companies for reinsurance. Expenses incurred in connection with acquiring new insurance business, including such acquisition cost as sales commissions, are charged to operations as incurred. In addition the company also uses the following accounting policies: a. Short term investments, if any, are listed at cost b. Bonds are stated at amortized cost using the interest method. c. Publically traded common stocks, if any, are listed at market value d. No preferred stock e. No mortgage loans f. Book value for mortgage-backed securities is the cost of remaining principal plus accrual of the discount or less amortization of the premium over the life of the bond to maturity g. See # 3 h. No joint ventures, partnerships or LLC s i. No derivatives j. No anticipated investment income utilized in calculations k. Case loss reserve estimates per onsite inspection of damage with IBNR tied to historical norms. There are no liability exposures to toxic waste, asbestos, ect. l. Company has not changed its capitalization policy form prior period m. No pharmaceutical rebate receivable SSAP # F/S Page F/S Line # NET INCOME (1) State basis (Page 4, Line 20, Columns 1 & 3) XXX XXX XXX 79, ,138 (2) State Prescribed Practices that increase/(decrease) NAIC SAP: (3) State Permitted Practices that increase/(decrease) NAIC SAP: (4) NAIC SAP (1-2-3=4) XXX XXX XXX 79, ,138 SURPLUS (5) State basis (Page 3, Line 37, Columns 1 & 2) XXX XXX XXX 3,995,007 3,916,687 (6) State Prescribed Practices that increase/(decrease) NAIC SAP: (7) State Permitted Practices that increase/(decrease) NAIC SAP: (8) NAIC SAP (5-6-7=8) XXX XXX XXX 3,995,007 3,916, Accounting Changes and Corrections of Errors The Company did not have any material changes in accounting principles and/or corrections of errors. 3. Business Combinations and Goodwill Not applicable. The Company did not have any business combinations. 4. Discontinued Operations Not applicable. The Company did not discontinue any of its operations. 5. Investments A. Mortgage Loans, including Mezzanine Real Estate Loans The Company has no investments in real estate mortgage loans B. Debt Restructuring The Company did not have any debt investments restructured during C. Reverse Mortgages The Company has no investments in reverse mortgages. D. Loan-Backed Securities The Company has no investments in loan-backed securities E. Repurchase Agreements and/or Securities Lending Transactions The Company has no investments in repurchase agreement securities requiring collateral. F. Real Estate G. Investments in Low-Income Housing Tax Credits (LIHTC) Q6

8 Not applicable Notes to Financial Statement H. Restricted Assets As of 03/31/2017 United Home Insurance Company had restricted assets on deposit with Arkansas Insurance Department valued at 70,000. (1) Restricted Assets (Including Pledged) Gross (Admitted & Nonadmited) Restricted Current Year Current Year Percentage G/A Total Protected Protected Cell Account Total 10 Gross (Admitted & Total Supporting Cell Assets Increase/ Total Admitted Nonadmitted General Protected Account Supporting Total (Decrease) Nonadmitt Restricted ) Restricted Restricted Asset Account Cell Account Restricted G/A Total From (5 minus ed (5 minus to Total Category (G/A) Activity (a) Assets Activity (b) (1 plus 3) Prior Year 6) Restricted 8) Assets (c) 11 Admitted Restricted to Total Admitted Assets (d) (a) Subject to contractual obligation for which liability is not shown % % (b) Collateral held under security lending agreements % % (c) Subject to repurchase agreements % % (d) Subject to reverse repurchase agreements % % (e) Subject to dollar repurchase agreements % % (f) Subject to dollar reverse repurchase agreements % % (g) Placed under option contracts % % (h) Letter stock or securities restricted as to sale excluding FHLB capital stock % % (i) FHLB capital stock % % (j) On deposit with states 70,000 70,000 70,000 70, %.921% (k) On deposit with other regulatory bodies % % (l) Pledged as collateral to FHLB (including assets backing funding agreements) % % (m ) Pledged as collateral not captured in other categories % % (n) Other restricted assets % % (o) Total Restricted Assets 70,000 70,000 70,000 70, %.921% (a) Subset of column 1 (b) Subset of column 3 (c) Column 5 divided by Asset Page Column 1,Line 28 (d) Column 9 divided by Asset Page, Column 3, Line 28 I. Working Capital Finance Investments J. Offsetting and Netting of Assets and Liabilities K. Structured Notes Not Applicable L. 5* Securities None 6. Joint Ventures, Partnerships and Limited Liability Companies A. The Company does not have any investments in joint ventures that exceed 10% of admitted assets. B. The Company did not recognize any impairment in its joint ventures 7. Investment Income The Company does not have any investment income due and accrued over 90 days past due and does not have any amounts excluded from surplus 8. Derivative Instruments Not applicable. The Company does not invest in derivative type investments 9. Income Taxes Q6.1

9 Notes to Financial Statement A. The components of the net deferred tax asset/(liability) at are as follows: (1) Ordinary 03/31/ /31/2016 Change (2) (3) (4) (5) (6) (7) (8) (Col. 1 + (Col. 4 + (Col. 1 (Col. 2 Capital 2) Total Ordinary Capital 5) Total 4) 5) Capital (9) (Col ) Total Description Ordinary (a) Gross Deferred Tax Assets 176,638 6, , ,266 6, ,721 (1,628) 397 (1,231) (b) Statutory Valuation Allowance Adjustments (c) Adjusted Gross Deferred Tax Assets (1a 1b) 176,638 6, , ,266 6, ,721 (1,628) 397 (1,231) (d) Deferred Tax Assets Nonadmitted (e) Subtotal Net Admitted Deferred Tax Asset (1c 1d) 176,638 6, , ,266 6, ,721 (1,628) 397 (1,231) (f) Deferred Tax Liabilities (g) Net Admitted Deferred Tax Asset/(Net Deferred Tax Liability) (1e 1f) 176,638 6, , ,266 6, ,721 (1,628) 397 (1,231) 03/31/ /31/2016 Change (1) (2) (3) (4) (5) (6) (7) (8) (9) Admission Calculation Components SSAP No. 101 Ordinary Capital (Col ) Total Ordinary Capital (Col ) Total (Col. 1 4) Ordinary (Col. 2 5) Capital (Col ) Total (a) Federal Income Taxes Paid In Prior Years Recoverable Through Loss Carrybacks (b) Adjusted Gross Deferred Tax Assets Expected To Be Realized (Excluding The Amount Of Deferred Tax Assets From 2(a) Above) After Application of the Threshold Limitation (The Lesser of 2(b)1 and 2(b)2 below) 176,638 6, , ,266 6, ,721 (1,628) 397 (1,231) 1. Adjusted Gross Deferred Tax Assets Expected to be Realized Following the 2. Balance Sheet Date Adjusted Gross Deferred Tax Assets Allowed per Limitation Threshold XXX XXX XXX XXX XXX XXX (c) Adjusted Gross Deferred Tax Assets (Excluding The Amount Of Deferred Tax Assets From 2(a) and 2(b) above) Offset by Gross Deferred Tax Liabilities (d) Deferred Tax Assets Admitted as the result of application of SSAP No. 101 Total (2(a) + 2(b) + 2(c)) 176,628 6, , ,266 6, ,721 (1,628) 397 (1,231) Description (a) Ratio Percentage Used To Determine Recovery Period And Threshold Limitation Amount (b) Amount Of Adjusted Capital And Surplus Used To Determine Recovery Period And Threshold Limitation in 2(b)2 Above. 3,731,966 3,731, Impact of Tax Planning Strategies (a). 03/31/ /31/2016 Change (1) (2) (3) (4) (5) (Col. 1 3) Capital Ordinary Capital Ordinary (6) (Col. 2-4) Capital Impact of Tax-Planning Strategies Ordinary Determination of adjusted gross deferred tax assets and net admitted deferred tax assets, by tax character as a percentage 1. Adjusted gross DTAs amount from Note 9A1(c) 176,638 6, ,266 6,455 (1,628) Percentage of adjusted gross DTAs by tax character attributable to the impact of tax planning strategies 3. Net Admitted Adjusted Gross DTAs amount from Note 9A1(e) 176,638 6, ,266 6,455 (1,628) Percentage of net admitted adjusted gross DTAs by tax character admitted because of the impact of tax planning strategies (b) Does the Company s tax-planning strategies include the use of reinsurance? Yes No x B. Regarding deferred tax liabilities that are not recognized: C. Current income taxes incurred consist of the following major components: (1) (2) (3) (Col. 1 2) Change Description 03/31/ /31/ Current Income Tax (a) Federal 23, ,460 (351,938) (b) Foreign (c) Subtotal 23, ,460 ( ) (d) Federal income tax on net capital gains (e) Utilization of capital loss carry-forwards (f) Other (g) Federal and foreign income taxes incurred 23, ,460 (351,938) 2. Deferred Tax Assets: Q6.2

10 Notes to Financial Statement (a) Ordinary (1) Discounting of unpaid losses 9,735 11,146 (1,411) (2) Unearned premium reserve 166, ,121 (217) (3) Policyholder reserves (4) Investments (5) Deferred acquisition costs (6) Policyholder dividends accrual (7) Fixed assets (8) Compensation and benefits accrual (9) Pension accrual (10) Receivables nonadmitted (11) Net operating loss carry-forward (12) Tax credit carry-forward (13) Other (including items < 5% of total ordinary tax assets) (99) Subtotal 176, ,267 (1,628) (b) Statutory valuation allowance adjustment (c) Nonadmitted (d) Admitted ordinary deferred tax assets (2a99 2b 2c) 176, ,267 (1,628) (e) Capital: (1) Investments 6,851 6, (2) Net capital loss carry-forward (3) Real estate (4) Other (including items < 5% of total capital tax assets) (99) Subtotal 6,851 6, (f) Statutory valuation allowance adjustment (g) Nonadmitted (h) Admitted capital deferred tax assets (2e99 2f 2g) 6,851 6, (i) Admitted deferred tax assets (2d + 2h) 183, ,722 (1,232) 3. Deferred Tax Liabilities: (a) Ordinary (1) Investments (2) Fixed assets (3) Deferred and uncollected premium (4) Policyholder reserves (5) Other (including items < 5% of total ordinary tax liabilities) (b) (99) Subtotal Capital: (1) Investments (2) Real estate (3) Other (including items < 5% of total capital tax liabilities) (99) Subtotal (c) Deferred tax liabilities (3a99 + 3b99) 4. Net deferred tax assets/liabilities (2i 3c) 183, ,722 (1,232) 10. Information Concerning Parent, Subsidiaries, Affiliates and Other Related Parties A. is managed by Farmers Home Holding Company an Arkansas C Corporation B. Farm and Home Mutual Insurance has made the following payments to Farmers Home Holding Company for management fees: 1. 01/24/2017 $187, C. See item B D. As of 03/31/2017 has a liability on its books for $126, due to Farmers Home Holding Company E. Not Applicable F. Not Applicable G. Not Applicable H. Not Applicable I. Not Applicable J. Not Applicable K. Not Applicable L. Not Applicable 11. Debt A. Debt The company has no capital notes. It does have a $50,000 line of credit with First National Bank of Paragould, AR. The outstanding balance as of 03/31/2017 was $100. This line of credit is collateralized by a $254, certificate of deposit at the same bank. B. FHLB (Federal Home Loan Bank) Agreements 12. Retirement Plans, Deferred Compensation, Postemployment Benefits and Compensated Absences and Other Postretirement Benefit Plans. Not Applicable 13. Capital and Surplus, Dividend Restrictions and Quasi-Reorganizations Not Applicable 14. Liabilities, Contingencies and Assessments A. Contingent Commitments The Company has no commitments, contingent commitments or guarantees or commitments to provide additional capital contributions. B. Assessments C. Gain Contingencies The Company has recorded no gain contingencies as of. D. Claims Related to Extra Contractual Obligations and Bad Faith Losses Stemming from Lawsuits Q6.3

11 Notes to Financial Statement The Company has no claims related to extra contractual obligations or bad faith losses. E. Product Warranties F. Joint and Several Liabilities G. All Other Contingencies In the normal course of business, the Company is subject to various contingent liabilities, including possible income tax assessment resulting from issues raised by taxing or regulatory authorities in their regular examinations. Management does not anticipate any significant losses or costs to result from any known or existing contingencies. There are no material legal proceedings other than those arising in the normal course of business and which generally pertain to claim matters relating to insurance policies and contracts issued by the Company. 15. Leases A. Lessee Operating Lease B. Lessor Leases 16. Information About Financial Instruments With Off-Balance-Sheet Risk And Financial Instruments With Concentrations of Credit Risk The Company does not invest in swaps, futures, derivatives or options. 17. Sale, Transfer and Servicing of Financial Assets and Extinguishments of Liabilities 18. Gain or Loss to the Reporting Entity from Uninsured Plans and the Uninsured Portion of Partially Insured Plans The Company does not write insurance for these types of A&H Plans. 19. Direct Premium Written/Produced by Managing General Agents/Third Party Administrators 20. Fair Value Measurements As of, there are no assets on the books that are required to be measured at fair value. 21. Other Items A. Unusual or Infrequent Items B. Troubled Debt Restructuring C. Other Disclosures Not Applicable D. Business Interruption Insurance Recoveries Not Applicable E. State Transferable and Non-transferable Tax Credits Not Applicable F. Subprime-Mortgage-Related Risk Exposure Not Applicable G. Insurance-Linked Securities (ILS) Contracts Not Applicable 22. Events Subsequent There were no material events subsequent to. 23. Reinsurance A. Unsecured Reinsurance Recoverable Not Applicable B. Reinsurance Recoverable in Dispute Not Applicable C. Reinsurance Assumed and Ceded Not Applicable D. Uncollectible Reinsurance Not Applicable E. Commutation of Ceded Reinsurance Not Applicable F. Retroactive Reinsurance Not Applicable G. Reinsurance Accounted for as a Deposit Not Applicable Q6.4

12 Notes to Financial Statement 24. Retrospectively Rated Contracts & Contracts Subject to Redetermination The Company does not participate in this type of business 25. Changes in Incurred Losses and Loss Adjustment Expenses Reserves for losses and loss adjustment expenses as of December 31, 2016 were $929,358. As of, $170, has been paid for incurred losses and loss adjustment expenses attributable to insured events of prior years. Reserves remaining for prior years are now $294, as a result of re-estimation of unpaid claims and claim adjustment expenses. Therefore there has been no favorable prior year development from December 31, 2016 to. The change is generally the result of ongoing analysis of the recent loss development trends. Original estimates are increased or decreased as additional information becomes known regarding individual claims 26. Intercompany Pooling Arrangements The Company does not participate in any intercompany pooling arrangements. 27. Structured Settlements 28. Health Care Receivables 29. Participating Policies 30. Premium Deficiency Reserves As of, the Company did not have any liabilities related to premium deficiency reserves. 31. High Deductibles Not Applicable 32. Discounting of Liabilities for Unpaid Losses or Unpaid Loss Adjustment Expenses The Company does not discount liabilities for unpaid losses and loss adjustment expenses. 33. Asbestos/Environmental Reserves The Company does not have exposure to asbestos or environmental claims. 34. Subscriber Savings Accounts The Company does not utilize subscriber savings accounts. 35. Multiple Peril Crop Insurance The Company does not write Multiple Peril Crop Insurance 36. Financial Guaranty Insurance The Company does not write Financial Guaranty Insurance. Q6.5

13 GENERAL INTERROGATORIES PART 1 - COMMON INTERROGATORIES GENERAL 1.1 Did the reporting entity experience any material transactions requiring the filing of Disclosure of Material Transactions with the State of Domicile, as required by the Model Act? Yes[ ] No[X] 1.2 If yes, has the report been filed with the domiciliary state? Yes[ ] No[ ] N/A[X] 2.1 Has any change been made during the year of this statement in the charter, by-laws, articles of incorporation, or deed of settlement of the reporting entity? Yes[ ] No[X] 2.2 If yes, date of change: Is the reporting entity a member of an Insurance Holding Company System consisting of two or more affiliated persons, one or more of which is an insurer? Yes[ ] No[X] If yes, complete Schedule Y, Parts 1 and 1A. 3.2 Have there been any substantial changes in the organizational chart since the prior quarter end? Yes[ ] No[X] 3.3 If the response to 3.2 is yes, provide a brief description of those changes: 4.1 Has the reporting entity been a party to a merger or consolidation during the period covered by this statement? Yes[ ] No[X] 4.2 If yes, provide the name of entity, NAIC Company Code, and state of domicile (use two letter state abbreviation) for any entity that has ceased to exist as a result of the merger or consolidation Name of Entity NAIC Company Code State of Domicile If the reporting entity is subject to a management agreement, including third-party administrator(s), managing general agent(s), attorney-in-fact, or similar agreement, have there been any significant changes regarding the terms of the agreement or principals involved? If yes, attach an explanation. Yes[ ] No[ ] N/A[X] 6.1 State as of what date the latest financial examination of the reporting entity was made or is being made /31/ State the as of date that the latest financial examination report became available from either the state of domicile or the reporting entity. This date should be the date of the examined balance sheet and not the date the report was completed or released /31/ State as of what date the latest financial examination report became available to other states or the public from either the state of domicile or the reporting entity. This is the release date or completion date of the examination report and not the date of the examination (balance sheet date) /21/ By what department or departments? 6.5 Have all financial statement adjustments within the latest financial examination report been accounted for in a subsequent financial statement filed with Departments? Yes[ ] No[ ] N/A[X] 6.6 Have all of the recommendations within the latest financial examination report been complied with? Yes[ ] No[ ] N/A[X] 7.1 Has this reporting entity had any Certificates of Authority, licenses or registrations (including corporate registration, if applicable) suspended or revoked by any governmental entity during the reporting period? 7.2 If yes, give full information Yes[ ] No[X] 8.1 Is the company a subsidiary of a bank holding company regulated by the Federal Reserve Board? Yes[ ] No[X] 8.2 If response to 8.1 is yes, please identify the name of the bank holding company. 8.3 Is the company affiliated with one or more banks, thrifts or securities firms? Yes[ ] No[X] 8.4 If response to 8.3 is yes, please provide below the names and location (city and state of the main office) of any affiliates regulated by a federal regulatory services agency [i.e. the Federal Reserve Board (FRB), the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC) and the Securities Exchange Commission (SEC)] and identify the affiliate s primary federal regulator.] Affiliate Name Location (City, State) FRB OCC FDIC SEC Yes[ ] No[X]. Yes[ ] No[X]. Yes[ ] No[X]. Yes[ ] No[X] 9.1 Are the senior officers (principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions) of the reporting entity subject to a code of ethics, which includes the following standards? Yes[X] No[ ] (a) Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; (b) Full, fair, accurate, timely and understandable disclosure in the periodic reports required to be filed by the reporting entity; (c) Compliance with applicable governmental laws, rules and regulations; (d) The prompt internal reporting of violations to an appropriate person or persons identified in the code; and (e) Accountability for adherence to the code If the response to 9.1 is No, please explain: 9.2 Has the code of ethics for senior managers been amended? Yes[ ] No[X] 9.21 If the response to 9.2 is Yes, provide information related to amendment(s). 9.3 Have any provisions of the code of ethics been waived for any of the specified officers? Yes[ ] No[X] 9.31 If the response to 9.3 is Yes, provide the nature of any waiver(s). FINANCIAL 10.1 Does the reporting entity report any amounts due from parent, subsidiaries or affiliates on Page 2 of this statement? Yes[ ] No[X] 10.2 If yes, indicate any amounts receivable from parent included in the Page 2 amount: $ INVESTMENT 11.1 Were any of the stocks, bonds, or other assets of the reporting entity loaned, placed under option agreement, or otherwise made available for use by another person? (Exclude securities under securities lending agreements.) 11.2 If yes, give full and complete information relating thereto: Yes[ ] No[X] 12. Amount of real estate and mortgages held in other invested assets in Schedule BA: $ Amount of real estate and mortgages held in short-term investments: $ Does the reporting entity have any investments in parent, subsidiaries and affiliates? Yes[ ] No[X] Q7