TORCHMARK CORPORATION

(PARENT COMPANY)

SCHEDULE II. CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED BALANCE SHEETS

(Amounts in thousands)


	December 31,
	2011			2010
Assets:
Investments:
Long-term investments	$	36,458		$	15,963
Short-term investments		58			62,582

Total investments		36,516			78,545
Cash		27,099			0
Investment in affiliates		5,329,769			4,973,495
Due from affiliates		50,977			138,130
Taxes receivable		61,616			65,195
Other assets		7,581			5,391

Total assets	$	5,513,558		$	5,260,756


Liabilities and shareholders' equity:
Liabilities:
Short-term debt	$	224,842		$	198,875
Long-term debt		790,571			789,643
Due to affiliates		145,556			136,931
Other liabilities		123,681			119,066

Total liabilities		1,284,650			1,244,515

Shareholders' equity:
Preferred stock		351			351
Common stock		112,312			119,812
Additional paid-in capital		775,842			783,119
Accumulated other comprehensive income		549,423			22,958
Retained earnings		3,634,481			3,473,482
Treasury stock		(843,501	)		(383,481	)

Total shareholders' equity		4,228,908			4,016,241

Total liabilities and shareholders' equity	$	5,513,558		$	5,260,756

See Notes to Condensed Financial Statements and accompanying Report of Independent Registered

Public Accounting Firm.

CONDENSED STATEMENTS OF OPERATIONS

(Amounts in thousands)


	Year Ended December 31,
	2011			2010			2009
Net investment income	$	23,542		$	26,031		$	17,374
Realized investment gains (losses)		508			(1,646	)		(1	)

Total revenue		24,050			24,385			17,373

General operating expenses		30,945			21,682			18,119
Reimbursements from affiliates		(19,335	)		(13,375	)		(5,973	)
Interest expense		75,426			74,827			71,687

Total expenses		87,036			83,134			83,833


Operating income (loss) before income taxes and equity in earnings of affiliates		(62,986	)		(58,749	)		(66,460	)
Income taxes		14,380			18,521			19,773


Net operating loss before equity in earnings of affiliates		(48,606	)		(40,228	)		(46,687	)
Equity in earnings of affiliates		566,491			557,292			451,640


Net income	$	517,885		$	517,064		$	404,953

See Notes to Condensed Financial Statements and accompanying Report of Independent Registered

Public Accounting Firm.

CONDENSED STATEMENTS OF CASH FLOWS

(Amounts in thousands)


	Year Ended December 31,
	2011			2010			2009
Cash provided from (used for) operations before dividends from subsidiaries	$	(33,042	)	$	(33,403	)	$	(51,241	)
Cash dividends from subsidiaries		769,139			370,947			354,695

Cash provided from operations		736,097			337,544			303,454

Cash provided from (used for) investing activities:
Acquisition of investments		0			(14,279	)		(125	)
Disposition of investments		11,828			33			31
Net decrease (increase) in short-term investments		62,524			106,881			(129,789	)
Investment in subsidiaries		(25,000	)		(18,722	)		(100,000	)

Cash provided from (used for) investing activities		49,352			73,913			(229,883	)

Cash provided from (used for) financing activities:
Issuance of 9¹/4% Senior Notes		0			0			296,308
Acquisition of 9¹/4% Senior Notes		0			(8,913	)		0
Repayment of 8¹/4% Senior Debentures		0			0			(99,050	)
Net issuance (repayment) of commercial paper		25,967			(34,432	)		(71,329	)
Issuance of stock		162,613			37,863			4,430
Acquisitions of treasury stock		(972,556	)		(246,006	)		(47,564	)
Net borrowings to/from subsidiaries		96,000			(86,800	)		(87,200	)
Excess tax benefit on stock option exercises		2,021			162			(30	)
Payment of dividends		(72,395	)		(73,331	)		(69,885	)

Cash provided from (used for) financing activities		(758,350	)		(411,457	)		(74,320	)


Net increase (decrease) in cash		27,099			0			(749	)
Cash balance at beginning of period		0			0			749

Cash balance at end of period	$	27,099		$	0		$	0

See Notes to Condensed Financial Statements and accompanying Report of Independent Registered

Public Accounting Firm.

TORCHMARK CORPORATION

(PARENT COMPANY)

NOTES TO CONDENSED FINANCIAL STATEMENTS

(Amounts in thousands)

Note A—Dividends from Subsidiaries

Cash dividends paid to Torchmark from the consolidated subsidiaries were as follows:


	2011		2010		2009
Consolidated subsidiaries	$	769,139	$	370,947	$	354,695

Note B—Supplemental Disclosures of Cash Flow Information

The following table summarizes noncash transactions, which are not reflected on the Condensed Statements of Cash Flows:


	Year Ended December 31,
	2011		2010		2009
Stock-based compensation not involving cash	$	14,954	$	11,848	$	9,860

The following table summarizes certain amounts paid (received) during the period:


	Year Ended December 31,
	2011		2010		2009
Interest paid	$	74,569	$	75,909	$	73,031
Income taxes received		22,893		2,379		25,202

Note C—Special Items

In 2009, a Federal income tax expense of $1.5 million was incurred relating to Internal Revenue Service examinations of prior years.

Note D—Preferred Stock

As of December 31, 2011, Torchmark had 351 thousand shares of Cumulative Preferred Stock, Series A, issued and outstanding, of which 280 thousand shares were 6.50% Cumulative Preferred Stock, Series A, and 71 thousand shares were 7.15% Cumulative Preferred Stock, Series A (collectively, the "Series A Preferred Stock"). All issued and outstanding shares of Series A Preferred Stock were held by wholly-owned insurance subsidiaries. In the event of liquidation, the holders of the Series A Preferred Stock at the time outstanding would be entitled to receive a liquidating distribution out of the assets legally available to stockholders in the amount of $1 thousand per share or $351 million in the aggregate, plus any accrued and unpaid dividends, before any distribution is made to holders of Torchmark common stock. Holders of Series A Preferred Stock do not have any voting rights nor have rights to convert such shares into shares of any other class of Torchmark capital stock.