A subsidiary of Globe owns a 133,000 square foot facility located in Oklahoma City, Oklahoma which houses the Globe direct response operation. This subsidiary also currently leases 37,000 square feet of space for its home office activities in downtown Oklahoma City.
The Liberty National Exclusive Agency markets primarily life insurance and supplemental health insurance, focusing on middle-income customers. Life premium income for this agency was $276 million in 2013, a 2% decrease compared with $282 million in 2012. Life premium also declined 2% in 2012 from 2011. First year collected premium declined 4% in 2013, after having declined 15% in 2012. The average face amount of life policies issued in 2013 was approximately $22 thousand.
Index to Financial Statements Annuities. Our fixed annuity balances at the end of 2013, 2012, and 2011 were $1.38 billion, $1.35 billion, and $1.29 billion, respectively. Underwriting income was $3.9 million, $3.5 million, and $2.3 million in each of the respective years.
Index to Financial Statements Presented in the following chart is the growth in net investment income compared with the growth in mean invested assets.
Index to Financial Statements Portfolio Analysis. Because Torchmark has recently invested almost exclusively in fixed-maturity securities, the relative percentage of our assets invested in various types of investments varies from industry norms. The following table presents a comparison of Torchmark’s components of invested assets at amortized cost as of December 31, 2013 with the latest industry data.
The following table presents the relative percentage of our fixed maturities by industry sector at December 31, 2013.
Bifurcated credit losses result when there is an other-than-temporary impairment for which a portion of the loss is recognized in other comprehensive income. Torchmark’s balances related to bifurcated credit loss positions included in other comprehensive income were $22 million at December 31, 2013, December 31, 2012, and December 31, 2011. There was no change in this balance since January 1, 2011.
Torchmark has net operating loss carryforwards of approximately $32.6 million at December 31, 2013 which will begin to expire in 2025 if not otherwise used to offset future taxable income. A valuation allowance is to be provided when it is more likely than not that deferred tax assets will not be realized by the Company. No valuation allowance has been recorded relating to Torchmark’s deferred tax assets since, in management’s judgment, Torchmark will more likely than not have sufficient taxable income in future periods to fully realize its existing deferred tax assets.
The other supplemental benefit pension plan is limited to a very select group of employees and was closed as of December 31, 1994. It provides the full benefits that an employee would have otherwise received from a defined benefit plan in the absence of the limitation on benefits payable under a qualified plan. This plan is unfunded. Liability for this closed plan was $3 million at December 31, 2013 and December 31, 2012. Pension cost for both supplemental defined benefit plans is determined in the same manner as for the qualified defined benefit plans.
Includes amortization of postretirement benefits other than pensions of $224 thousand in 2013.
Because of the nature of the life insurance industry, Torchmark has no individual or group which would be considered a major customer. Substantially all of Torchmark’s business is conducted in the United States, primarily in the Southeastern and Southwestern regions.