EX-12 3 a14-14085_1ex12.htm EX-12

Exhibit 12

 

CONSOLIDATED EARNINGS RATIOS

 

The following table sets forth, for the years and periods ended, Protective Life Insurance Company’s (the “Company”) ratios of:

 

·                  Consolidated earnings to fixed charges.

·                  Consolidated earnings to fixed charges before interest credited on investment products.

 

 

 

For The

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

For The Year Ended December 31,

 

 

 

2014

 

2013

 

2013

 

2012

 

2011

 

2010

 

2009

 

Ratio of Consolidated Earnings to Fixed Charges (1)

 

1.7

 

1.4

 

1.4

 

1.4

 

1.4

 

1.3

 

1.4

 

Ratio of Consolidated Earnings (Losses) to Fixed Charges Before Interest Credited on Investment Products (2)

 

6.4

 

4.4

 

4.7

 

5.8

 

6.1

 

5.5

 

10.4

 

 

(1) The Company calculates the ratio of “Consolidated Earnings to Fixed Charges” by dividing the sum of income (loss) from continuing operations before income tax (BT), interest expense (which includes an estimate of the interest component of operating lease expense) (I) and interest credited on investment products (IP) by the sum of interest expense (I) and interest credited on investment products (IP). The formula for this ratio is: (BT+I+IP)/(I+IP). The Company continues to sell investment products that credit interest to the contract holder. Investment products include products such as guaranteed investment contracts, annuities, and variable universal life interest credited insurance policies. The inclusion of interest credited on investment products results in a negative impact on the ratio of earnings to fixed charges because the effect of increases in interest credited to contract holders more than offsets the effect of the increase in earnings.

 

(2) The Company calculates the ratio of “Consolidated Earnings (Losses) to Fixed Charges Before Interest Credited on Investment Products” by dividing the sum of income (loss) from continuing operations before income tax (BT) and interest expense (I) by interest expense (I). The formula for this calculation, therefore, would be: (BT+I)/I.

 

1


 

Computation of Consolidated Earnings Ratios

 

 

 

For The

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

For The Year Ended December 31,

 

 

 

2014

 

2013

 

2013

 

2012

 

2011

 

2010

 

2009

 

 

 

(Dollars In Thousands, Except Ratio Data)

 

Computation of Ratio of Consolidated Earnings (Losses) to Fixed Charges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) from Continuing Operations before Income Tax

 

$

324,226

 

$

188,741

 

$

422,499

 

$

459,579

 

$

475,275

 

$

333,176

 

$

390,441

 

Add Interest Expense (1)

 

59,559

 

56,188

 

115,113

 

95,759

 

93,797

 

73,841

 

41,411

 

Add Interest Credited on Investment Products

 

422,306

 

448,223

 

875,180

 

962,678

 

993,574

 

972,806

 

993,245

 

Earnings before Interest, Interest Credited on Investment Products and Taxes

 

$

806,091

 

$

693,152

 

$

1,412,792

 

$

1,518,016

 

$

1,562,646

 

$

1,379,823

 

$

1,425,097

 

Earnings before Interest, Interest Credited on Investment Products and Taxes Divided by Interest expense and Interest Credited on Investment Products

 

1.7

 

1.4

 

1.4

 

1.4

 

1.4

 

1.3

 

1.4

 

Computation of Ratio of Consolidated Earnings (Losses) to Fixed Charges Before Interest Credited on Investment Products

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) from Continuing Operations before Income Tax

 

$

324,226

 

$

188,741

 

$

422,499

 

$

459,579

 

$

475,275

 

$

333,176

 

$

390,441

 

Add Interest Expense (1)

 

59,559

 

56,188

 

115,113

 

95,759

 

93,797

 

73,841

 

41,411

 

Earnings (Losses) before Interest and Taxes

 

$

383,785

 

$

244,929

 

$

537,612

 

$

555,338

 

$

569,072

 

$

407,017

 

$

431,852

 

Earnings (Losses) before Interest and Taxes Divided by Interest Expense

 

6.4

 

4.4

 

4.7

 

5.8

 

6.1

 

5.5

 

10.4

 

 

(1)Interest expense primarily relates to interest on our non-recourse funding obligations.

 

2