Company: PRI
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0000950170-25-029882
Chunk: 457

Company: Primerica, Inc.
Filing Date: 2025-02-28
Form: 10-K
Item: Item 8
Chunk 457
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 management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Liability for future policy benefits for term life insurance contracts 

As described in Notes 1 and 11 to the consolidated financial statements, the liability for future policy benefits is measured as the present value of expected future benefits less the present value of expected future net premiums receivable under the contracts. The cash flow assumptions underlying the liability for future policy benefits include mortality, persistency, and disability rates. The cash flow assumptions used to measure the liability for future policy benefits are reviewed at least annually and updated as necessary. As of December 31, 2024, the liability for future policy benefits was $6,503 million, which included the liability for future policy benefits for term life insurance contracts of $6,301 million.

We identified the evaluation of the liability for future policy benefits for term life insurance contracts as a critical audit 		matter. Specifically, the evaluation of the mortality, persistency, and disability rate cash flow assumptions (collectively, 

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key 		assumptions) used in estimating the liability for future policy benefits for term life insurance contracts required subjective 		auditor judgment and specialized skills and knowledge.

The following are the primary procedures we performed to address this critical audit matter. With the assistance of actuarial 		professionals with specialized skills and knowledge, we evaluated the design and tested the operating effectiveness of certain 		internal controls related to the Company’s process for estimating the liability for future policy benefits for term life insurance 	contracts. This included controls related to the actuarial methodologies and the key assumptions. We also involved actuarial 		professionals with specialized skills and knowledge, who assisted in:

•assessing the actuarial methodologies used to estimate the liability for future policy benefits for term life insurance contracts for consistency