8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 8, 2007

CITIZENS, INC.

(Exact name of registrant as specified in its charter)

COLORADO	0-16509	84-0755371
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

400 East Anderson Lane
Austin, Texas 78752
(Address of principal executive offices) (Zip Code)

(512) 837-7100
Registrant’s telephone number, including area code

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

News Release issued by Citizens, Inc.

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On August 8, 2007, Citizens, Inc. (“Citizens”) issued a news release (the “Release”) reporting, among other things, results for the second quarter ended June 30, 2007. A copy of the Release is included as Exhibit 99.2 to this Current Report on Form 8-K and incorporated herein by reference.

The information in this report is being furnished, not filed, for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and pursuant to Item 2.02 of Form 8-K will not be incorporated by reference into any filing under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

     (a) Financial Statements of businesses acquired:

     Not applicable.

     (b) Pro Forma financial information:

     Not applicable.

     (c) Exhibits:

     The following exhibit is included with this Current Report on Form 8-K:

Exhibit No.	Description
99.2	News Release issued by Citizens, Inc. on August 8, 2007.

SIGNATURE

     Pursuant to the requirement of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

CITIZENS, INC
By:	/s/ Rick D. Riley
	Rick D. Riley, President

Date: August 10, 2007

EXHIBIT INDEX

Exhibit No.	Description
99.2	News Release issued by Citizens, Inc. on August 8, 2007.

EX-99.1

Exhibit 99.2

News Release

For further information contact:
Investor Relations and Public Relations

FOR IMMEDIATE RELEASE

CITIZENS, INC. REPORTS INCREASED EARNINGS
THROUGH JUNE

Austin, Texas — August 8, 2007 — Citizens, Inc. (NYSE: CIA) reported net income of $6.0 million or $0.12 per share for the six months ended June 30, 2007, compared to net income of $1.8 million, or $0.02 per share, for the same period in 2006. The increase in earnings is due primarily to higher premium income as well as lower hurricane-related casualty claims which adversely affected the Company in 2006.

Total revenues increased 8.2% in the first six months of 2007 to $81.0 million compared to the same period of 2006 when revenues were $74.9 million. Total revenues from our Life Insurance segment increased to $54.7 million compared to $48.1 million. Premium income was $66.4 million for the first half of 2007, an 11.4% increase over the same period of 2006 when premiums equaled $59.6 million. The increase was due primarily to increased new business issued in the international life market, as well as an increase in renewal premiums due to improved persistency. Net investment income increased 8.8% during the first half of 2007 to $14.1 million from $13.0 million in 2006, the increase fueled by an increase in the size of the investment portfolio. Underwriting and insurance expenses decreased 7.1% from $15.3 million in 2006 to $14.2 million in 2007 due to economies of scale achieved on our Security Plan Life operations and to non-recurring, non-operating expenses in the prior year. In 2007, Home Service casualty claims totaled $825,000, more in line with historical experience, compared to the $2.6 million in 2006, which reflected abnormally high claims as a result of hurricane Katrina. Endowment benefits increased to $6.0 million, or 21.9%, from $4.9 million. This is a popular benefit in the Pacific Rim market where the Company has experienced steady new business growth in recent years.

For the three months ended June 30, 2007, the Company earned net income of $3.5 million or $0.07 per share, compared to $748,000 or $0.01 per share for the same period in 2006. The increase in second quarter income resulted primarily from an increase in premium income, lower general expenses and lower hurricane-related casualty claims which was partially offset by an increase in policy reserves and higher income taxes.

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News Release

Total revenues increased 9.4% to $41.6 million, compared to $38.0 million in the same quarter of 2006. Premium income was $34.0 million for the quarter, compared to $30.5 million in 2006. The 11.5% increase is due primarily to new business in the international life segment. Net investment income increased 5.1% in the quarter to $7.1 million, from $6.7 million in the second quarter of 2006 due to higher invested assets. Also in 2007, we purchased $10.0 million of growth-oriented mutual funds. Claims and surrenders for the quarter were $12.9 million compared to $14.1 million for the same period in 2006. The decrease is primarily related to casualty claims from hurricane Katrina.

Assets increased to $724.5 million at June 30, 2007, compared to $711.2 million at December 31, 2006. Stockholders’ equity increased from $139.6 million at December 31, 2006 to $141.6 million at June 30, 2007, due to income earned during the period, offset by an increase in unrealized losses in the Company’s bond portfolio. The Company has no subprime mortgage or securities risk.

About Citizens, Inc.

Citizens, Inc., parent of Citizens, Inc. Financial Group of Companies, is a financial services company listed on the New York Stock Exchange under the symbol CIA. The Company plans to achieve $1 billion in assets, $250 million in revenues and $10 billion of life insurance in force by 2010, via the worldwide sale of U.S. dollar denominated whole life cash value insurance policies, coupled with the acquisition of other life insurance companies. Citizens’ Class A common stock closed at $6.40 on August 8, 2007.

Additional information is available about the Company on its web site: www.citizensinc.com.

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Information herein contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as “may,” “will,” “expect,” “anticipate” or “continue” or comparable words. In addition, all statements other than statements of historical facts that address activities that the Company expects or anticipates will or may occur in the future are forward-looking statements. Readers are encouraged to read the SEC reports of the Company, particularly its Form 10-K for the fiscal year ended December 31, 2006 and its current reports on Form 8-K, for the meaningful cautionary language disclosing why actual results may vary materially from those anticipated by management. The Company undertakes no duty or obligation to update any forward-looking statements contained in this release as a result of new information, future events or changes in the Company’s expectations. The Company also disclaims any duty to comment upon or correct information that may be contained in reports published by the investment community.

News Release

CITIZENS, INC.
COMPARATIVE CONSOLIDATED FINANCIAL HIGHLIGHTS

(In thousands except per share amounts)

OPERATING STATEMENTS

	(Unaudited)						(Unaudited)
	Six Months Ended						Three Months Ended
	June 30,						June 30,
	2007			2006			2007			2006
Revenues
Premiums	$	66,441			59,647			34,024			30,520
Net investment income		14,131			12,994			7,064			6,724
Realized gains (losses), net		(132	)		1,133			(119	)		260
Decrease (increase) in fair value of warrants		(196	)		365			231			175
Other income		785			717			433			366
Total revenues		81,029			74,856			41,633			38,045
Benefits and Expenses
Insurance benefits paid or provided:
Claims and surrenders		27,102			28,203			12,946			14,055
Increase in future policy benefit reserves		15,324			14,509			8,389			7,403
Policyholders’ dividends		2,652			2,328			1,422			1,306
Total insurance benefits paid or provided		45,078			45,040			22,757			22,764
Commissions		17,386			17,631			8,997			8,834
Other underwriting, acquisition and insurance expenses		14,224			15,309			7,324			8,334
Capitalization of deferred policy acquisition costs		(12,906	)		(13,014	)		(6,782	)		(6,688	)
Amortization of deferred policy acquisition costs		6,480			5,674			3,329			3,052
Amortization of cost of customer relationships acquired and other intangibles		1,667			1,831			826			865
Total benefits and expenses		71,929			72,471			36,451			37,161
Income before Federal income tax		9,100			2,385			5,182			884
Federal income tax expense		3,134			616			1,655			136
Net income	$	5,966			1,769			3,527			748
Net income applicable to common stock	$	4,952			755			3,016			240
Basic and diluted earnings per share of common stock	$	0.12			0.02			0.07			0.01
Weighted average shares outstanding - basic and diluted		41,303			41,185			41,315			41,202

BALANCE SHEETS

	(Unaudited)
	June 30		December 31,
	2007		2006
Total assets	$	724,456		711,184
Total invested assets	$	538,185		515,055
Stockholders’ equity	$	141,628		139,611