Exhibit 10(k), Form 10-K

Kansas City Life Insurance Company

KANSAS CITY LIFE INSURANCE COMPANY

INCENTIVE PLAN

2011

JANUARY 24, 2011

--------------------------------------------------------------------------------

KANSAS CITY LIFE 2011 INCENTIVE PLAN

GENERAL CONSIDERATIONS

ELIGIBLE EMPLOYEES

For 2011, eligible employees for the 2011 Incentive Plan will be the President,
CEO and Chairman, (Class I); Vice Chairman of the Board (Class IIA), Senior Vice
Presidents (Class IIB); Vice Presidents (Class III); all associates with at
least 675 “Hay Points” (Class IV); and all associates with “Hay Points” starting
at 534 and ending with 674 (Class V). Class IV includes one (1) OAIC associate
and the Chief Pilot. The salaries of all Class I, II, III, IV, and V
participants will total approximately $11.7 million during 2011. Presently there
are 83 Class I, II, III, IV and V participants.

EXCLUSIONS

The Plan does not cover the following employees: 1) employees who would qualify
as a Class IV or V participant, who are paid on the DP payline, and who do not
have any supervisory responsibilities; 2) Kansas City Life Sales and Marketing
employees included in the Regional Incentive Compensation Program or other field
compensation programs; 3) Old American employees included in the Old American
Insurance Company Incentive Plan or the Old American Regional Incentive
Compensation Program; and, 4) Kansas City Life Group Department employees
included in the Group Sales Incentive Plan. Part time employees are not eligible
to participate.

TIMING OF PAYOUT

It is the objective of the 2011 Incentive Plan to pay out awards after 2011
earnings are released to the public.

CORPORATE VS INDIVIDUAL AWARDS — ALL CLASSES

All plan participants share the same three corporate goals: operating earnings,
growth and expense control. With the exception of Class I, all awards include
the achievement of two individual goals. The individual goals are designed for
each participant, but should support the overall corporate goals. Individual
goals can be shared with other participants when teamwork is necessary to
accomplish a shared strategic responsibility.

 

1

--------------------------------------------------------------------------------

The Class I award is based entirely on the achievement of three corporate goals.

Class IIA and Group Classes III, IV and V awards are based on the achievement of
three corporate goals, three business unit goals and two individual goals.

Class IIB, III, IV, and V awards are based on the achievement of three corporate
goals and two individual goals.

The weighting of awards for corporate versus individual goals differs for the
various classes of participants. As an example, the Class I participant is
measured solely (100%) on the achievement of corporate goals while the Class IV
and V participants are rewarded with a greater emphasis on achievement of
corporate goals than individual goals (i.e., 65% of the award is based on the
achievement of corporate goals while 35% is based on the achievement of
individual goals).

The following table outlines the weighting of awards based on the achievement of
corporate vs. individual goals for all classes of participants.

 

    

Corporate/Business

Unit Goals

        Individual Goals      Class   

% Of Total

Award*

   # Of Goals   

% Of Total

Award*

   # Of Goals

I

   100%    3    N/A    0

IIA

   45%/40%    6    15%    2

IIB

   85%    3    15%    2

III

   75%    3    25%    2

III Group

   40%/35%    6    25%    2

IV

   65%    3    35%    2

IV Group

   35%/30%    6    35%    2

V

   65%    3    35%    2

V Group

   35%/30%    6    35%    2

PLAN ADMINISTRATION GUIDELINES

NEW HIRE

An employee hired into an incentive eligible position during the first two
quarters of the calendar year will be eligible to participate in the Plan
effective the first day of the month following the date of hire. The employee
will receive a prorata award from the Plan for the year in which the participant
was hired. An employee hired in the last two quarters of the year will
participate in the Plan beginning the following year.

 

2

--------------------------------------------------------------------------------

PROMOTION FROM NON-INCENTIVE ELIGIBLE POSITION TO INCENTIVE ELIGIBLE POSITION

An employee promoted during the first two quarters of the calendar year to an
incentive eligible position will be eligible to participate in the Plan
effective the first day of the month following the date of promotion. They will
receive a prorata award from the Plan for the year in which they were promoted.

Any employee promoted to an incentive eligible position in the last two quarters
of the year will participate in the Plan beginning the following year.

CHANGE IN CLASS FROM ONE LEVEL TO ANOTHER

Any employee changing from one class to another during the first two quarters of
the year in which the Plan is already in place will receive prorated awards
based on the full months of participation. Any employee changing from one class
to another during the last two quarters of the year will participate in the new
class beginning the following year.

TERMINATION DUE TO DEATH, OR RETIREMENT

The participant will receive a prorated award from the Plan for the year in
which the event occurred. Awards will be calculated and prorated based on
completion of corporate goals and the number of full months of employment during
the Incentive Plan year. The determination for payment of individual goals will
be made by the appropriate Senior Vice President or the President and pro-rated
in the same manner as the corporate goals.

TERMINATION DUE TO DISABILITY

The participant will receive a prorated award from the Plan for the year in
which the event occurred based on the number of months the participant was
actively at work. Awards will be calculated and prorated based on completion of
corporate goals and the number of full months the participant was actively at
work during the Incentive Plan year. The determination for payment of individual
goals will be made by the appropriate Senior Vice President or the President and
pro-rated in the same manner as the corporate goals.

TERMINATION FOR ANY OTHER REASON

No award will be made from the Plan for the year in which termination occurred.

OTHER EVENTS

Any changes regarding corporate goals, incentive design, and deviations from
established guidelines will be made by the President CEO and Chairman of the
Board and the Compensation Committee of the Board.

 

3

--------------------------------------------------------------------------------

EXHIBIT A

Award Matrices

 

4

--------------------------------------------------------------------------------

CLASS I MATRIX

(President, CEO and Chairman)

 

     Threshold   Target   Maximum

Corporate Goals

      

Goal 1 - Financial

   14.0%   28.0%   42.0%

Goal 2 - Growth

   14.0%   28.0%   42.0%

Goal 3 - Expense

     14.0%   14.0%

Total

   28.0%   70.0%   98.0%

ADDITIONAL CONSIDERATIONS:

 

*

No awards if financial results (Net Income) are less than Earnings Trigger.

*

The Financial and Growth goals are pro-rated for results between Threshold and
Maximum.

*

The Expense Goal is achieved or not achieved.

 

5

--------------------------------------------------------------------------------

CLASS IIA MATRIX

(Vice Chairman of the Board)

 

     Threshold     Target     Maximum  

Corporate Goals

      

Goal 1 – Financial

     3.600 %      7.200 %      10.800 % 

Goal 2 – Growth

     3.600 %      7.200 %      10.800 % 

Goal 3 – Expense

       3.600 %      3.600 % 

Corporate Goal Total

     7.200 %      18.000 %      25.200 % 

Old American Goals

      

Goal 1 – Financial

     3.200 %      6.400 %      9.600 % 

Goal 2 – Growth

     3.200 %      6.400 %      9.600 % 

Goal 3 – Production

     1.600 %      3.200 %      4.800 % 

Business Unit Goal Total

     8.00 %      16.000 %      24.000 % 

Individual Goals

      

Individual Goal #1

     3.000 %      3.000 %      3.000 % 

Individual Goal #2

     3.000 %      3.000 %      3.000 % 

Individual Goal Total

     6.000 %      6.000 %      6.000 % 

Total

     21.200 %      40.00 %      55.200 % 

ADDITIONAL CONSIDERATIONS:

 

*

No awards if financial results (Net Income) are less than Earnings Trigger.

*

The Financial and Growth goals are pro-rated for results between Threshold and
Maximum.

*

The Expense Goal is achieved or not achieved.

 

6

--------------------------------------------------------------------------------

CLASS IIB MATRIX

(Senior Vice Presidents)

 

     Threshold     Target     Maximum  

Corporate Goals

      

Goal 1 - Financial

     6.8 %      13.6 %      20.4 % 

Goal 2 - Growth

     6.8 %      13.6 %      20.4 % 

Goal 3 - Expense

       6.8 %      6.8 % 

Corporate Goal Total

     13.6 %      34.0 %      47.6 % 

Individual Goals

      

Individual Goal #1

     3.0 %      3.0 %      3.0 % 

Individual Goal #2

     3.0 %      3.0 %      3.0 % 

Individual Goal Total

     6.0 %      6.0 %      6.0 % 

Total

     19.6 %      40.0 %      53.6 % 

ADDITIONAL CONSIDERATIONS:

 

*

No awards if financial results (Net Income) are less than Earnings Trigger.

*

The Financial and Growth goals are pro-rated for results between Threshold and
Maximum.

*

The Expense Goal is achieved or not achieved.

 

7

--------------------------------------------------------------------------------

CLASS III MATRIX

(Vice Presidents)

 

     Threshold     Target     Maximum  

Corporate Goals

      

Goal 1 - Financial

     3.750 %      7.500 %      11.250 % 

Goal 2 - Growth

     3.750 %      7.500 %      11.250 % 

Goal 3 - Expense

       3.750 %      3.750 % 

Corporate Goal Total

     7.500 %      18.750 %      26.250 % 

Individual Goals

      

Individual Goal #1

     3.125 %      3.125 %      3.125 % 

Individual Goal #2

     3.125 %      3.125 %      3.125 % 

Individual Goal Total

     6.250 %      6.250 %      6.250 % 

Total

     13.750 %      25.00 %      32.500 % 

ADDITIONAL CONSIDERATIONS:

 

*

No awards if financial results (Net Income) are less than Earnings Trigger.

*

The Financial and Growth goals are pro-rated for results between Threshold and
Maximum.

*

The Expense Goal is achieved or not achieved.

 

8

--------------------------------------------------------------------------------

CLASS IV MATRIX

(Associates With >675 Hay Points)

 

     Threshold     Target     Maximum  

Corporate Goals

      

Goal 1 - Financial

     1.950 %      3.900 %      5.850 % 

Goal 2 - Growth

     1.950 %      3.900 %      5.850 % 

Goal 3 - Expense

       1.950 %      1.950 % 

Corporate Goal Total

     3.900 %      9.750 %      13.650 % 

Individual Goals

      

Individual Goal #1

     2.625 %      2.625 %      2.625 % 

Individual Goal #2

     2.625 %      2.625 %      2.625 % 

Individual Goal Total

     5.250 %      5.250 %      5.250 % 

Total

     9.150 %      15.00 %      18.900 % 

ADDITIONAL CONSIDERATIONS:

 

*

No awards if financial results (Net Income) are less than Earnings Trigger.

*

The Financial and Growth goals are pro-rated for results between Threshold and
Maximum.

*

The Expense Goal is achieved or not achieved.

 

9

--------------------------------------------------------------------------------

CLASS V MATRIX

(Associates With Points >533 and <675)

 

     Threshold     Target     Maximum  

Corporate Goals

      

Goal 1 - Financial

     1.30 %      2.60 %      3.90 % 

Goal 2 - Growth

     1.30 %      2.60 %      3.90 % 

Goal 3 - Expense

       1.30 %      1.30 % 

Corporate Goal Total

     2.60 %      6.50 %      9.10 % 

Individual Goals

      

Individual Goal #1

     1.75 %      1.75 %      1.75 % 

Individual Goal #2

     1.75 %      1.75 %      1.75 % 

Individual Goal Total

     3.50 %      3.50 %      3.50 % 

Total

     6.10 %      10.00 %      12.60 % 

ADDITIONAL CONSIDERATIONS:

 

*

No awards if financial results (Net Income) are less than Earnings Trigger.

*

The Financial and Growth goals are pro-rated for results between Threshold and
Maximum.

*

The Expense Goal is achieved or not achieved.

 

10

--------------------------------------------------------------------------------

EXHIBIT B

SUMMARY OF 2011 CORPORATE GOALS

Earnings Trigger—Measured by Net Income on a calendar year basis: $21.66 MM

Corporate Goals

 

I.      FINANCIAL GOAL: Operating Earnings measured on a calendar year basis

Target

  

$27.07MM

Threshold:

  

$21.66MM

Maximum:

  

$32.49MM

II.     GROWTH GOAL: Life insurance Target Premium

Target:

  

$11,866,000 (10% Increase)

Threshold:

  

$11,542,000 (7% Increase)

Maximum:

  

$12,405,000 (15% Increase)

III.   EXPENSE GOAL: Controllable Expenses (Adjusted)

Goal:

  

$72.575 MM (0% Increase to 2010 Controllable Expenses)

Incentive plan costs will be excluded from financial measures for incentive plan
purposes.

 

11

--------------------------------------------------------------------------------

 

LOGO [g269768a241.jpg]

 

12

--------------------------------------------------------------------------------

 

LOGO [g269768a242.jpg]

 

13

--------------------------------------------------------------------------------

 

LOGO [g269768a243.jpg]

 

14

--------------------------------------------------------------------------------

 

LOGO [g269768a244.jpg]

 

15