Note C—Postretirement Benefit Plans

The following tables present a summary of post-retirement benefit costs by component.

Components of Post-Retirement Benefit Costs


	Three Months ended June 30,
	Pension Benefits						Other Benefits
	2013			2012			2013		2012
Service cost	$	3,727		$	2,690		$	117	$	120
Interest cost		4,259			4,145			257		256
Expected return on assets		(4,359	)		(4,117	)		0		0
Prior service cost		567			515			0		0
Net actuarial (gain)/loss		4,061			2,992			75		0

Net periodic benefit cost	$	8,255		$	6,225		$	449	$	376


	Six Months ended June 30,
	Pension Benefits						Other Benefits
	2013			2012			2013		2012
Service cost	$	7,492		$	5,381		$	202	$	244
Interest cost		8,523			8,297			517		513
Expected return on assets		(8,715	)		(8,237	)		0		0
Prior service cost		1,138			1,031			0		0
Net actuarial (gain)/loss		8,124			5,958			75		0

Net periodic benefit cost	$	16,562		$	12,430		$	794	$	757

The following chart presents assets at fair value for the defined-benefit pension plans at June 30, 2013 and the prior-year end.

Pension Assets by Component

(Dollar amounts in thousands)


	June 30, 2013				December 31, 2012
	Amount		%		Amount		%
Corporate debt	$	152,720		55.1	$	169,817		61.2
Other fixed maturities		283		0.1		327		0.1
Equity securities		102,557		37.0		89,833		32.4
Short-term investments		6,726		2.4		2,218		0.8
Guaranteed annuity contract		13,208		4.8		13,277		4.8
Other		1,794		0.6		2,169		0.7

Total	$	277,288		100.0	$	277,641		100.0

The liability for the funded defined-benefit pension plans was $358 million at June 30, 2013 and $353 million at December 31, 2012. No cash contributions were made to the qualified pension plans during the six months ended June 30, 2013. Torchmark plans to make cash contributions not to exceed $20 million during the remainder of 2013. With respect to the Company’s non-qualified supplemental retirement plan, life insurance policies on the lives of plan participants have been established with an unaffiliated carrier to fund a portion of the Company’s obligations under the plan. These policies, as well as investments deposited with an unaffiliated trustee, were previously placed in a Rabbi Trust to provide for payment of the plan obligations. At June 30, 2013, the combined value of the insurance policies and investments in the Rabbi Trust to support plan liabilities were $60 million, compared with $54 million at year end 2012. This plan is unqualified. Therefore, the value of the insurance policies and investments are recorded as other assets in the Consolidated Balance Sheets and are not included in the chart of plan assets above. The liability for the unqualified pension plan was $60 million at June 30, 2013 and $59 million at December 31, 2012.