Segment and Other Operating Information

6 Months Ended

Jun. 30, 2019

Segment Reporting [Abstract]

Segment and Other Operating Information

SEGMENT AND OTHER OPERATING INFORMATION

The Company defines its reportable operating segments as domestic life insurance, international life insurance, annuities, and acquired companies. These segments are organized based on product types, geographic marketing areas, and business groupings. Ozark National and NIS have been combined into the segment "Acquired Businesses" given its inter-related marketing and sales approach which consists of a coordinated sale of a non-participating whole life insurance product (Ozark National) and a mutual fund investment product (NIS). As disclosed in the Company's filings for 2018, National Western discontinued accepting applications for the Company's international products from residents of other countries in May 2018. A fifth category "All Others" primarily includes investments and earnings of non-operating subsidiaries as well as other remaining investments and assets not otherwise supporting specific segment operations.

A summary of segment information as of June 30, 2019 and December 31, 2018 for the Condensed Consolidated Balance Sheet items and for the three and six months ended June 30, 2019 and June 30, 2018 for the Condensed Consolidated Statement of Earnings is provided below.

Condensed Consolidated Balance Sheet Items:

	June 30, 2019
	Domestic Life Insurance		International Life Insurance	Annuities	Acquired Businesses	All Others	Totals
	(In thousands)
Deferred policy acquisition costs, sales inducements, and value of business acquired	$	119,695	217,361	528,241	143,678	—	1,008,975
Total segment assets	1,287,216		1,171,538	8,465,260	953,048	372,642	12,249,704
Future policy benefits	1,108,455		879,742	7,563,354	696,457	—	10,248,008
Other policyholder liabilities	17,239		14,956	94,389	15,147	—	141,731

	December 31, 2018
	Domestic Life Insurance		International Life Insurance	Annuities	Acquired Businesses	All Others	Totals
	(In thousands)
Deferred policy acquisition costs and sales inducements	$	122,661	243,518	609,239	—	—	975,418
Total segment assets	1,215,864		1,211,036	8,791,463	—	370,118	11,588,481
Future policy benefits	1,039,150		894,891	7,810,245	—	—	9,744,286
Other policyholder liabilities	17,439		20,381	97,874	—	—	135,694

Condensed Consolidated Statement of Earnings:

	Three Months Ended June 30, 2019
	Domestic Life Insurance		International  Life Insurance	Annuities	Acquired Businesses	All  Others	Totals
	(In thousands)
Premiums and contract revenues	$	10,706	23,777	5,857	20,380	—	60,720
Net investment income	14,995		9,276	89,572	6,007	8,574	128,424
Other revenues	20		33	64	2,290	1,559	3,966
Total revenues	25,721		33,086	95,493	28,677	10,133	193,110
Life and other policy benefits	3,829		2,959	9,876	16,993	—	33,657
Amortization of deferred policy acquisition costs and value of business acquired	3,307		6,948	18,750	2,406	—	31,411
Universal life and annuity contract interest	12,985		7,337	39,817	—	—	60,139
Other operating expenses	5,017		4,521	9,374	4,491	1,931	25,334
Federal income taxes (benefit)	89		2,014	3,155	956	2,323	8,537
Total expenses	25,227		23,779	80,972	24,846	4,254	159,078
Segment earnings (loss)	$	494	9,307	14,521	3,831	5,879	34,032

	Six Months Ended June 30, 2019
	Domestic Life Insurance		International Life Insurance	Annuities	Acquired Businesses	All Others	Totals
	(In thousands)
Premiums and contract revenues	$	21,510	49,840	10,725	34,181	—	116,256
Net investment income	38,494		23,293	192,726	9,983	15,259	279,755
Other revenues	64		54	72	3,731	6,458	10,379
Total revenues	60,068		73,187	203,523	47,895	21,717	406,390
Life and other policy benefits	7,751		5,121	21,306	27,668	—	61,846
Amortization of deferred policy acquisition costs and value of business acquired	6,717		14,242	38,462	4,154	—	63,575
Universal life and annuity contract interest	34,426		19,330	87,299	—	—	141,055
Other operating expenses	9,140		8,785	16,882	7,576	9,000	51,383
Federal income taxes (benefit)	413		5,222	8,038	1,703	2,582	17,958
Total expenses	58,447		52,700	171,987	41,101	11,582	335,817
Segment earnings (loss)	$	1,621	20,487	31,536	6,794	10,135	70,573

	Three Months Ended June 30, 2018
	Domestic Life Insurance		International  Life Insurance	Annuities	Acquired Businesses	All  Others	Totals
	(In thousands)
Premiums and contract revenues	$	10,114	27,461	7,298	—	—	44,873
Net investment income	13,556		10,603	86,915	—	10,728	121,802
Other revenues	—		4	18	—	5,265	5,287
Total revenues	23,670		38,068	94,231	—	15,993	171,962
Life and other policy benefits	5,103		4,534	7,824	—	—	17,461
Amortization of deferred acquisition costs	2,709		7,336	21,024	—	—	31,069
Universal life and annuity contract interest	9,907		7,600	43,483	—	—	60,990
Other operating expenses	5,006		5,628	9,085	—	5,076	24,795
Federal income taxes (benefit)	185		2,516	2,478	—	2,132	7,311
Total expenses	22,910		27,614	83,894	—	7,208	141,626
Segment earnings (loss)	$	760	10,454	10,337	—	8,785	30,336

	Six Months Ended June 30, 2018
	Domestic Life Insurance		International Life Insurance	Annuities	Acquired Businesses	All Others	Totals
	(In thousands)
Premiums and contract revenues	$	19,715	55,378	12,445	—	—	87,538
Net investment income	14,219		12,574	140,458	—	15,296	182,547
Other revenues	—		34	37	—	10,213	10,284
Total revenues	33,934		67,986	152,940	—	25,509	280,369
Life and other policy benefits	9,912		10,262	18,688	—	—	38,862
Amortization of deferred acquisition costs	5,384		14,716	43,198	—	—	63,298
Universal life and annuity contract interest	7,046		6,450	45,676	—	—	59,172
Other operating expenses	10,153		11,009	17,020	—	10,246	48,428
Federal income taxes (benefit)	283		5,023	5,576	—	2,999	13,881
Total expenses	32,778		47,460	130,158	—	13,245	223,641
Segment earnings (loss)	$	1,156	20,526	22,782	—	12,264	56,728

Reconciliations of segment information to the Company's Condensed Consolidated Financial Statements are provided below.

	Three Months Ended June 30,				Six Months Ended June 30,
	2019			2018	2019	2018
	(In thousands)
Premiums and Other Revenues:
Premiums and contract revenues	$	60,720		44,873	116,256	87,538
Net investment income	128,424			121,802	279,755	182,547
Other revenues	3,966			5,287	10,379	10,284
Realized gains (losses) on investments	(425		)	2,696	4,204	3,307
Total condensed consolidated premiums and other revenues	$	192,685		174,658	410,594	283,676

	Three Months Ended June 30,				Six Months Ended June 30,
	2019			2018	2019	2018
	(In thousands)
Federal Income Taxes:
Total segment Federal income taxes	$	8,537		7,311	17,958	13,881
Taxes on realized gains (losses) on investments	(89		)	566	883	694
Total condensed consolidated Federal income taxes	$	8,448		7,877	18,841	14,575

	Three Months Ended June 30,				Six Months Ended June 30,
	2019			2018	2019	2018
	(In thousands)
Net Earnings:
Total segment earnings	$	34,032		30,336	70,573	56,728
Realized gains (losses) on investments, net of taxes	(336		)	2,130	3,321	2,613
Total condensed consolidated net earnings	$	33,696		32,466	73,894	59,341

	June 30,		December 31,
	2019		2018
	(In thousands)
Assets:
Total segment assets	$	12,249,704	11,588,481
Other unallocated assets	363,246		343,210
Total condensed consolidated assets	$	12,612,950	11,931,691