pri-ex992

This document may contain forward-looking statements and information. Additional information and factors that could cause actual results to differ materially from any forward-looking statements or information in this document is available in our Form 10-K for the year ended December 31, 2017.

This document is a financial supplement to our third quarter 2018 earnings release. It is designed to enable comprehensive analysis of our ongoing business using the same core metrics that our management utilizes in assessing our business and making strategic and operational decisions. Throughout this document we provide financial information that is derived from our U.S. GAAP financial statements and adjusted for three different purposes, as follows:

Management utilizes these non-GAAP financial measures in managing the business and believes they present relevant and meaningful analytical metrics for evaluating the ongoing business. Reconciliations of non-GAAP to GAAP financial measures are included in this financial supplement.

Certain items throughout this supplement may not add due to rounding and as such, may not agree to other public reporting of the respective item. Certain items throughout this supplement are noted as ‘na’ to indicate not applicable. Certain variances are noted as ‘nm’ to indicate not meaningful. Certain reclassifications have been made to prior-period amounts to conform to current-period reporting classifications. These reclassifications had no impact on net income or total stockholders’ equity.

(Dollars in thousands)				Dec 31, 2016			Mar 31, 2017			Jun 30, 2017			Sep 30, 2017			Dec 31, 2017			Mar 31, 2018			Jun 30, 2018			Sep 30, 2018
Condensed Balance Sheets
Assets:
	Investments and cash excluding securities held to maturity			$	2,087,607		$	2,110,131		$	2,139,275		$	2,157,513		$	2,287,955		$	2,254,512		$	2,239,045		$	2,322,453
	Securities held to maturity				503,230			535,160			635,690			688,840			737,150			796,450			843,810			891,860
			Total investments and cash		2,590,837			2,645,291			2,774,965			2,846,353			3,025,105			3,050,962			3,082,855			3,214,313
	Due from reinsurers				4,193,562			4,219,547			4,191,754			4,238,978			4,205,173			4,263,111			4,199,275			4,196,021
	Deferred policy acquisition costs				1,713,065			1,767,681			1,833,877			1,900,122			1,951,892			1,998,985			2,053,445			2,107,814
	Other assets				653,525			681,156			719,765			734,425			705,661			759,973			772,058			769,387
	Separate account assets				2,287,953			2,356,320			2,424,937			2,486,960			2,572,872			2,419,707			2,389,007			2,419,997
			Total assets	$	11,438,943		$	11,669,996		$	11,945,297		$	12,206,839		$	12,460,704		$	12,492,737		$	12,496,640		$	12,707,531

Liabilities:
	Future policy benefits			$	5,673,890		$	5,736,313		$	5,812,217		$	5,894,882		$	5,954,524		$	6,004,101		$	6,057,112		$	6,132,750
	Other policy liabilities				631,700			642,640			645,443			656,434			685,885			693,223			673,912			682,126
	Income taxes				225,006			237,719			241,314			255,877			177,468			184,161			182,140			182,241
	Other liabilities				449,963			449,734			428,176			463,926			451,398			506,535			495,242			511,623
	Notes payable				372,919			373,011			373,103			373,196			373,288			373,381			373,474			373,567
	Surplus note				502,491			534,435			634,980			688,055			736,381			795,697			843,073			891,139
	Payable under securities lending				73,646			93,326			115,875			106,978			89,786			89,433			82,096			70,632
	Separate account liabilities				2,287,953			2,356,320			2,424,937			2,486,960			2,572,872			2,419,707			2,389,007			2,419,997
			Total liabilities		10,217,568			10,423,499			10,676,044			10,926,309			11,041,603			11,066,237			11,096,056			11,264,074

Stockholders’ equity:
	Common stock ($0.01 par value) (1)				457			455			450			444			443			440			432			430
	Paid-in capital				52,468			28,606			(0	)		(0	)		(0	)		(0	)		(0	)		(0	)
	Retained earnings				1,138,851			1,182,038			1,224,375			1,228,546			1,375,090			1,416,564			1,409,104			1,452,841
	Treasury stock				—			—			—			—			—			—			—			—
	Accumulated other comprehensive income (loss), net:
		Net unrealized investment gains (losses) not other-than-temporarily impaired			42,852			47,534			49,883			47,191			39,686			14,039			1,493			(4,380	)
		Net unrealized investment losses other-than-temporarily impaired			(62	)		(56	)		(54	)		(143	)		(113	)		(136	)		(136	)		(135	)
		Cumulative translation adjustment			(13,193	)		(12,082	)		(5,401	)		4,492			3,995			(4,406	)		(10,309	)		(5,300	)
			Total stockholders’ equity		1,221,374			1,246,497			1,269,253			1,280,530			1,419,101			1,426,500			1,400,584			1,443,456
			Total liabilities and stockholders' equity	$	11,438,943		$	11,669,996		$	11,945,297		$	12,206,839		$	12,460,704		$	12,492,737		$	12,496,640		$	12,707,531

Reconciliation of Adjusted Stockholders' Equity to Total Stockholders' Equity
Adjusted stockholders' equity				$	1,178,584		$	1,199,018		$	1,219,424		$	1,233,482		$	1,379,528		$	1,412,597		$	1,399,227		$	1,447,972
Reconciling items:
	Net unrealized investment gains (losses) not other-than-temporarily impaired				42,852			47,534			49,883			47,191			39,686			14,039			1,493			(4,380	)
	Net unrealized investment losses other-than-temporarily impaired				(62	)		(56	)		(54	)		(143	)		(113	)		(136	)		(136	)		(135	)
		Total reconciling items			42,791			47,479			49,829			47,048			39,573			13,903			1,357			(4,515	)
			Total stockholders’ equity	$	1,221,374		$	1,246,497		$	1,269,253		$	1,280,530		$	1,419,101		$	1,426,500		$	1,400,584		$	1,443,456

Adjusted Stockholders' Equity Rollforward
Balance, beginning of period				$	1,149,131		$	1,178,584		$	1,199,018		$	1,219,424		$	1,233,482		$	1,379,528		$	1,412,597		$	1,399,227
	Net Income				56,874			52,069			63,107			66,635			168,443			65,714			86,699			85,139
	Shareholder dividends				(8,410	)		(8,882	)		(8,799	)		(9,120	)		(9,020	)		(11,278	)		(11,086	)		(10,920	)
	Retirement of shares and warrants				(18,697	)		(36,353	)		(45,185	)		(57,916	)		(17,318	)		(51,563	)		(87,448	)		(33,616	)
	Net foreign currency translation adjustment				(4,966	)		1,111			6,681			9,893			(497	)		(8,402	)		(5,903	)		5,009
	Other, net				4,653			12,489			4,602			4,565			4,437			38,598			4,367			3,132
Balance, end of period				$	1,178,584		$	1,199,018		$	1,219,424		$	1,233,482		$	1,379,528		$	1,412,597		$	1,399,227		$	1,447,972

Deferred Policy Acquisition Costs Rollforward
Balance, beginning of period				$	1,672,454		$	1,713,065		$	1,767,681		$	1,833,877		$	1,900,122		$	1,951,892		$	1,998,985		$	2,053,445
	General expenses deferred				8,226			9,489			9,061			9,350			8,887			9,599			9,800			8,886
	Commission costs deferred				89,647			95,923			99,341			102,113			99,411			104,314			103,192			100,890
	Amortization of deferred policy acquisition costs				(53,305	)		(51,850	)		(47,861	)		(53,384	)		(56,304	)		(60,165	)		(53,847	)		(59,534	)
	Foreign currency impact and other, net				(3,957	)		1,054			5,653			8,166			(224	)		(6,655	)		(4,684	)		4,127
Balance, end of period				$	1,713,065		$	1,767,681		$	1,833,877		$	1,900,122		$	1,951,892		$	1,998,985		$	2,053,445		$	2,107,814

																								YOY Q3												YOY YTD
(Dollars in thousands, except per-share data)			Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$/# Change			% Change			YTD 2017			YTD 2018			$/# Change			% Change
Earnings per Share
Basic earnings per share:
	Weighted-average common shares and fully vested equity awards			46,301,339			45,983,783			45,317,641			44,809,433			44,739,864			44,065,972			43,452,234			(1,865,407	)		-4.1	%		45,863,985			44,081,307			(1,782,678	)	-3.9%

	Net income		$	52,069		$	63,107		$	66,635		$	168,443		$	65,714		$	86,699		$	85,139		$	18,504			27.8	%	$	181,811		$	237,552		$	55,740		30.7%
	Less income attributable to unvested participating securities			(421	)		(430	)		(465	)		(1,171	)		(425	)		(483	)		(485	)		(20	)		-4.4	%		(1,326	)		(1,405	)		(78	)	-5.9%
		Net income used in computing basic EPS	$	51,648		$	62,677		$	66,170		$	167,272		$	65,289		$	86,216		$	84,654		$	18,483			27.9	%	$	180,485		$	236,147		$	55,662		30.8%
		Basic earnings per share	$	1.12		$	1.36		$	1.46		$	3.73		$	1.46		$	1.96		$	1.95		$	0.49			33.4	%	$	3.94		$	5.36		$	1.42		36.1%

	Adjusted net operating income		$	51,976		$	63,039		$	66,620		$	72,258		$	66,215		$	85,984		$	84,489		$	17,869			26.8	%	$	181,635		$	236,689		$	55,054		30.3%
	Less operating income attributable to unvested participating securities			(421	)		(430	)		(465	)		(502	)		(428	)		(479	)		(482	)		(17	)		-3.6	%		(1,325	)		(1,399	)		(74	)	-5.6%
		Adjusted net operating income used in computing basic operating EPS	$	51,556		$	62,609		$	66,156		$	71,755		$	65,787		$	85,506		$	84,008		$	17,852			27.0	%	$	180,310		$	235,290		$	54,980		30.5%
		Basic adjusted operating income per share	$	1.11		$	1.36		$	1.46		$	1.60		$	1.47		$	1.94		$	1.93		$	0.47			32.4	%	$	3.93		$	5.34		$	1.41		35.8%

Diluted earnings per share:
	Weighted-average common shares and fully vested equity awards			46,301,339			45,983,783			45,317,641			44,809,433			44,739,864			44,065,972			43,452,234			(1,865,407	)		-4.1	%		45,863,985			44,081,307			(1,782,678	)	-3.9%
	Dilutive impact of contingently issuable shares			72,947			86,550			89,455			107,386			115,421			140,567			136,628			47,173			52.7	%		82,984			130,872			47,888		57.7%
		Shares used to calculate diluted EPS		46,374,286			46,070,333			45,407,096			44,916,819			44,855,285			44,206,539			43,588,862			(1,818,234	)		-4.0	%		45,946,969			44,212,179			(1,734,790	)	-3.8%

	Net income		$	52,069		$	63,107		$	66,635		$	168,443		$	65,714		$	86,699		$	85,139		$	18,504			27.8	%	$	181,811		$	237,552		$	55,740		30.7%
	Less income attributable to unvested participating securities			(421	)		(430	)		(464	)		(1,169	)		(424	)		(481	)		(484	)		(20	)		-4.3	%		(1,324	)		(1,401	)		(77	)	-5.8%
		Net income used in computing diluted EPS	$	51,648		$	62,677		$	66,171		$	167,275		$	65,290		$	86,217		$	84,655		$	18,484			27.9	%	$	180,487		$	236,151		$	55,664		30.8%
		Diluted earnings per share	$	1.11		$	1.36		$	1.46		$	3.72		$	1.46		$	1.95		$	1.94		$	0.48			33.3	%	$	3.93		$	5.34		$	1.41		36.0%

	Adjusted net operating income		$	51,976		$	63,039		$	66,620		$	72,258		$	66,215		$	85,984		$	84,489		$	17,869			26.8	%	$	181,635		$	236,689		$	55,054		30.3%
	Less operating income attributable to unvested participating securities			(420	)		(429	)		(464	)		(501	)		(427	)		(478	)		(480	)		(16	)		-3.5	%		(1,323	)		(1,396	)		(73	)	-5.5%
		Adjusted net operating income used in computing diluted operating EPS	$	51,556		$	62,609		$	66,156		$	71,756		$	65,788		$	85,507		$	84,009		$	17,853			27.0	%	$	180,312		$	235,293		$	54,981		30.5%
		Diluted adjusted operating income per share	$	1.11		$	1.36		$	1.46		$	1.60		$	1.47		$	1.93		$	1.93		$	0.47			32.3	%	$	3.92		$	5.32		$	1.40		35.6%

																							YOY Q3												YOY YTD
		Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$/# Change			% Change			YTD 2017			YTD 2018			$/# Change			% Change
Annualized Return on Equity
	Average stockholders' equity	$	1,233,936		$	1,257,875		$	1,274,892		$	1,349,815		$	1,422,801		$	1,413,542		$	1,422,020		$	147,129			11.5	%	$	1,255,567		$	1,419,454		$	163,887			13.1	%
	Average adjusted stockholders' equity	$	1,188,801		$	1,209,221		$	1,226,453		$	1,306,505		$	1,396,063		$	1,405,912		$	1,423,599		$	197,146			16.1	%	$	1,208,159		$	1,408,525		$	200,366			16.6	%

	Net income return on stockholders' equity		16.9	%		20.1	%		20.9	%		49.9	%		18.5	%		24.5	%		23.9	%		3.0	%	nm				19.3	%		22.3	%		3.0	%	nm
	Net income return on adjusted stockholders' equity		17.5	%		20.9	%		21.7	%		51.6	%		18.8	%		24.7	%		23.9	%		2.2	%	nm				20.1	%		22.5	%		2.4	%	nm

	Adjusted net operating income return on adjusted stockholders' equity		17.5	%		20.9	%		21.7	%		22.1	%		19.0	%		24.5	%		23.7	%		2.0	%	nm				20.0	%		22.4	%		2.4	%	nm

Capital Structure
	Debt-to-capital (1)		23.0	%		22.7	%		22.6	%		20.8	%		20.7	%		21.1	%		20.6	%		-2.0	%	nm				22.6	%		20.6	%		-2.0	%	nm

	Cash and invested assets to stockholders' equity		2.1	x		2.2	x		2.2	x		2.1	x		2.1	x		2.2	x		2.2	x		0.0	x	nm				2.2	x		2.2	x		0.0	x	nm
	Cash and invested assets to adjusted stockholders' equity		2.2	x		2.3	x		2.3	x		2.2	x		2.2	x		2.2	x		2.2	x		(0.1	x)	nm				2.3	x		2.2	x		(0.1	x)	nm

	Share count, end of period (2)		45,549,739			45,034,788			44,380,349			44,251,256			43,953,046			43,168,005			42,976,742			(1,403,607	)		-3.2	%		44,380,349			42,976,742			(1,403,607	)		-3.2	%
	Adjusted stockholders' equity per share	$	26.32		$	27.08		$	27.79		$	31.17		$	32.14		$	32.41		$	33.69		$	5.90			21.2	%	$	27.79		$	33.69		$	5.90			21.2	%

Financial Strength Ratings - Primerica Life Insurance Co
	Moody's	A2			A2			A2			A2			A2			A2			A1			nm			nm			nm			nm			nm			nm
	S&P	AA-			AA-			AA-			AA-			AA-			AA-			AA-			nm			nm			nm			nm			nm			nm
	A.M. Best	A+			A+			A+			A+			A+			A+			A+			nm			nm			nm			nm			nm			nm

Holding Company Senior Debt Ratings
	Moody's	Baa2			Baa2			Baa2			Baa2			Baa2			Baa2			Baa1			nm			nm			nm			nm			nm			nm
	S&P	A-			A-			A-			A-			A-			A-			A-			nm			nm			nm			nm			nm			nm
	A.M. Best	a-			a-			a-			a-			a-			a-			a-			nm			nm			nm			nm			nm			nm

																								YOY Q3												YOY YTD
(Dollars in thousands)			Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$ Change			% Change			YTD 2017			YTD 2018			$ Change			% Change
Statement of Income
Revenues:
	Direct premiums		$	627,698		$	637,426		$	646,079		$	650,906		$	656,087		$	667,191		$	670,222		$	24,143			3.7	%	$	1,911,203		$	1,993,499		$	82,296			4.3	%
	Ceded premiums			(399,769	)		(406,043	)		(397,641	)		(397,318	)		(394,249	)		(403,449	)		(391,175	)		6,466			1.6	%		(1,203,452	)		(1,188,873	)		14,579			1.2	%
		Net premiums		227,929			231,384			248,438			253,587			261,838			263,741			279,047			30,609			12.3	%		707,751			804,626			96,875			13.7	%
	Net investment income			19,894			19,742			19,922			19,459			19,017			20,030			20,622			700			3.5	%		59,558			59,669			112			0.2	%
	Commissions and fees:
		Sales-based (1)		60,517			60,692			53,488			58,307			64,461			64,307			64,181			10,693			20.0	%		174,697			192,949			18,252			10.4	%
		Asset-based (2)		64,474			67,424			70,279			72,982			74,649			75,672			78,318			8,040			11.4	%		202,176			228,640			26,464			13.1	%
		Account-based (3)		13,217			13,282			13,811			14,720			20,595			20,438			20,306			6,495			47.0	%		40,310			61,339			21,029			52.2	%
		Other commissions and fees		6,060			6,919			7,049			8,097			7,122			7,523			8,074			1,025			14.5	%		20,028			22,719			2,690			13.4	%
	Realized investment (losses) gains			134			104			22			1,079			(1,656	)		1,313			(126	)		(149	)	nm				260			(470	)		(730	)	nm
	Other, net			12,939			14,150			14,291			14,710			13,897			14,790			14,359			68			0.5	%		41,381			43,047			1,666			4.0	%
	Total revenues			405,164			413,696			427,300			442,941			459,923			467,814			484,781			57,481			13.5	%		1,246,161			1,412,518			166,358			13.3	%
Benefits and expenses:
	Benefits and claims			102,385			99,512			105,864			108,259			116,890			105,069			118,787			12,923			12.2	%		307,761			340,747			32,986			10.7	%
	Amortization of DAC			51,850			47,861			53,384			56,304			60,165			53,847			59,534			6,150			11.5	%		153,094			173,546			20,451			13.4	%
	Insurance commissions			4,899			5,157			5,593			5,459			5,877			6,417			6,584			991			17.7	%		15,649			18,878			3,229			20.6	%
	Insurance expenses			37,621			36,920			37,636			35,102			41,109			43,451			41,925			4,289			11.4	%		112,177			126,485			14,308			12.8	%
	Sales commissions:
		Sales-based (1)		43,209			43,253			38,338			41,261			46,259			45,905			45,634			7,295			19.0	%		124,800			137,797			12,997			10.4	%
		Asset-based (2)		27,630			28,965			30,220			31,698			32,484			33,350			34,813			4,593			15.2	%		86,815			100,646			13,831			15.9	%
		Other sales commissions		2,865			3,221			3,463			3,864			3,777			3,700			4,141			678			19.6	%		9,550			11,618			2,068			21.7	%
	Interest expense			7,127			7,144			7,074			7,143			7,173			7,229			7,216			142			2.0	%		21,345			21,617			273			1.3	%
	Other operating expenses			52,736			45,274			45,528			45,762			63,228			55,083			54,712			9,184			20.2	%		143,538			173,023			29,484			20.5	%
	Total benefits and expenses			330,322			317,308			327,100			334,852			376,961			354,050			373,346			46,246			14.1	%		974,730			1,104,357			129,627			13.3	%
	Income before income taxes			74,841			96,389			100,200			108,089			82,962			113,764			111,435			11,235			11.2	%		271,431			308,162			36,731			13.5	%
Income taxes				22,772			33,282			33,565			(60,355	)		17,248			27,065			26,296			(7,269	)		-21.7	%		89,619			70,610			(19,010	)		-21.2	%
	Net income		$	52,069		$	63,107		$	66,635		$	168,443		$	65,714		$	86,699		$	85,139		$	18,504			27.8	%	$	181,811		$	237,552		$	55,740			30.7	%

Income Before Income Taxes by Segment
Term Life			$	49,022		$	61,855		$	66,543		$	68,237		$	59,621		$	75,827		$	74,338		$	7,795			11.7	%	$	177,420		$	209,786		$	32,366			18.2	%
Investment & Savings Products				37,119			39,684			39,050			46,982			39,985			43,228			45,052			6,002			15.4	%		115,853			128,265			12,411			10.7	%
Corporate & Other Distributed Products				(11,300	)		(5,149	)		(5,392	)		(7,131	)		(16,644	)		(5,291	)		(7,954	)		(2,562	)		-47.5	%		(21,842	)		(29,889	)		(8,047	)		-36.8	%
	Income before income taxes		$	74,841		$	96,389		$	100,200		$	108,089		$	82,962		$	113,764		$	111,435		$	11,235			11.2	%	$	271,431		$	308,162		$	36,731			13.5	%

																							YOY Q3												YOY YTD
(Dollars in thousands)		Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$ Change			% Change			YTD 2017			YTD 2018			$ Change			% Change
Reconciliation from Term Life Direct Premiums to Term Life Adjusted Direct Premiums
	Term Life direct premiums	$	620,379		$	630,485		$	638,830		$	644,373		$	649,366		$	660,505		$	663,183		$	24,353			3.8	%	$	1,889,695		$	1,973,054		$	83,359			4.4	%
	Less: Premiums ceded to IPO Coinsurers		312,982			308,323			304,580			300,144			294,301			290,956			284,742			(19,838	)		-6.5	%		925,884			869,999			(55,885	)		-6.0	%
	Term Life adjusted direct premiums	$	307,397		$	322,163		$	334,251		$	344,230		$	355,065		$	369,548		$	378,441		$	44,190			13.2	%	$	963,811		$	1,103,055		$	139,244			14.4	%


Reconciliation from Term Life Ceded Premiums to Term Life Other Ceded Premiums
	Term Life ceded premiums	$	(398,077	)	$	(404,175	)	$	(395,772	)	$	(394,987	)	$	(392,561	)	$	(401,686	)	$	(389,332	)	$	6,441			1.6	%	$	(1,198,024	)	$	(1,183,579	)	$	14,446			1.2	%
	Less: Premiums ceded to IPO Coinsurers		(312,982	)		(308,323	)		(304,580	)		(300,144	)		(294,301	)		(290,956	)		(284,742	)		19,838			6.5	%		(925,884	)		(869,999	)		55,885			6.0	%
	Term Life other ceded premiums	$	(85,095	)	$	(95,852	)	$	(91,193	)	$	(94,843	)	$	(98,260	)	$	(110,730	)	$	(104,590	)	$	(13,397	)		-14.7	%	$	(272,140	)	$	(313,580	)	$	(41,439	)		-15.2	%


Reconciliation from Net Investment Income to Adjusted Net Investment Income
	Net Investment Income	$	19,894		$	19,742		$	19,922		$	19,459		$	19,017		$	20,030		$	20,622		$	700			3.5	%	$	59,558		$	59,669		$	112			0.2	%
	Less: MTM investment adjustments		—			—			—			—			(1,288	)		(375	)		(297	)	nm			nm				—			(1,960	)	nm			nm
	Adjusted net investment income	$	19,894		$	19,742		$	19,922		$	19,459		$	20,305		$	20,405		$	20,920		$	998			5.0	%	$	59,558		$	61,629		$	2,072			3.5	%


Reconciliation from Total Revenues to Adjusted Operating Revenues
	Total revenues	$	405,164		$	413,696		$	427,300		$	442,941		$	459,923		$	467,814		$	484,781		$	57,481			13.5	%	$	1,246,161		$	1,412,518		$	166,358			13.3	%
	Less: Realized investment gains/(losses)		134			104			22			1,079			(1,656	)		1,313			(126	)	nm			nm				260			(470	)	nm			nm
	Less: MTM investment adjustments		—			—			—			—			(1,288	)		(375	)		(297	)	nm			nm				—			(1,960	)	nm			nm
	Adjusted operating revenues	$	405,030		$	413,592		$	427,278		$	441,862		$	462,866		$	466,877		$	485,205		$	57,927			13.6	%	$	1,245,900		$	1,414,948		$	169,048			13.6	%


Reconciliation from Income Before Income Taxes to Adjusted Operating Income Before Income Taxes
	Income before income taxes	$	74,841		$	96,389		$	100,200		$	108,089		$	82,962		$	113,764		$	111,435		$	11,235			11.2	%	$	271,431		$	308,162		$	36,731			13.5	%
	Less: Realized investment gains/(losses)		134			104			22			1,079			(1,656	)		1,313			(126	)	nm			nm				260			(470	)	nm			nm
	Less: MTM investment adjustments		—			—			—			—			(1,288	)		(375	)		(297	)	nm			nm				—			(1,960	)	nm			nm
	Adjusted operating income before income taxes	$	74,708		$	96,285		$	100,178		$	107,010		$	85,906		$	112,827		$	111,859		$	11,681			11.7	%	$	271,170		$	310,592		$	39,421			14.5	%


Reconciliation from Net Income to Adjusted Net Operating Income
	Net income	$	52,069		$	63,107		$	66,635		$	168,443		$	65,714		$	86,699		$	85,139		$	18,504			27.8	%	$	181,811		$	237,552		$	55,740			30.7	%
	Less: Income before income taxes reconciling items		134			104			22			1,079			(2,944	)		937			(424	)	nm			nm				260			(2,430	)	nm			nm
	Less: Tax impact of income before income taxes reconciling items		(41	)		(36	)		(8	)		(350	)		675			(223	)		104		nm			nm				(84	)		555		nm			nm
	Less: Transition impact of tax reform (1)		—			—			—			95,457			1,768			—			970		nm			nm				—			2,737		nm			nm
	Adjusted net operating income	$	51,976		$	63,039		$	66,620		$	72,258		$	66,215		$	85,984		$	84,489		$	17,869			26.8	%	$	181,635		$	236,689		$	55,054			30.3	%

																							YOY Q3												YOY YTD
(Dollars in thousands)		Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$ Change			% Change			YTD 2017			YTD 2018			$ Change			% Change
Term Life Insurance
Revenues:
	Direct Premiums	$	620,379		$	630,485		$	638,830		$	644,373		$	649,366		$	660,505		$	663,183		$	24,353			3.8	%	$	1,889,695		$	1,973,054		$	83,359			4.4	%
	Premiums ceded to IPO coinsurers (1)		(312,982	)		(308,323	)		(304,580	)		(300,144	)		(294,301	)		(290,956	)		(284,742	)		19,838			6.5	%		(925,884	)		(869,999	)		55,885			6.0	%
	Adjusted direct premiums (2)		307,397			322,163			334,251			344,230			355,065			369,548			378,441			44,190			13.2	%		963,811			1,103,055			139,244			14.4	%
	Other ceded premiums (3)		(85,095	)		(95,852	)		(91,193	)		(94,843	)		(98,260	)		(110,730	)		(104,590	)		(13,397	)		-14.7	%		(272,140	)		(313,580	)		(41,439	)		-15.2	%
	Net premiums		222,302			226,311			243,058			249,387			256,805			258,818			273,851			30,793			12.7	%		691,671			789,475			97,805			14.1	%
	Allocated net investment income		2,303			2,347			2,527			2,754			3,089			3,246			3,506			979			38.8	%		7,177			9,841			2,664			37.1	%
	Other, net		9,446			10,244			10,655			10,890			10,415			10,913			10,615			(40	)		-0.4	%		30,345			31,943			1,598			5.3	%
	Revenues		234,051			238,902			256,240			263,031			270,309			272,978			287,972			31,732			12.4	%		729,192			831,259			102,066			14.0	%

Benefits and expenses:
	Benefits and claims		97,771			95,532			101,351			103,559			112,831			101,755			113,988			12,637			12.5	%		294,653			328,574			33,921			11.5	%
	Amortization of DAC		50,133			44,937			50,386			56,294			56,673			51,257			56,904			6,518			12.9	%		145,456			164,834			19,377			13.3	%
	Insurance commissions		1,408			1,646			1,874			1,799			2,228			2,856			2,936			1,061			56.6	%		4,929			8,019			3,091			62.7	%
	Insurance expenses		35,717			34,932			36,086			33,142			38,956			41,282			39,807			3,722			10.3	%		106,734			120,045			13,311			12.5	%
	Benefits and expenses		185,029			177,047			189,697			194,794			210,688			197,150			213,635			23,937			12.6	%		551,773			621,473			69,700			12.6	%
	Income before income taxes	$	49,022		$	61,855		$	66,543		$	68,237		$	59,621		$	75,827		$	74,338		$	7,795			11.7	%	$	177,420		$	209,786		$	32,366			18.2	%

Investment & Savings Products
Revenues:
	Commissions and fees:
	Sales-based	$	60,517		$	60,692		$	53,488		$	58,307		$	64,461		$	64,307		$	64,181		$	10,693			20.0	%	$	174,697		$	192,949		$	18,252			10.4	%
	Asset-based		64,474			67,424			70,279			72,982			74,649			75,672			78,318			8,040			11.4	%		202,176			228,640			26,464			13.1	%
	Account-based		13,217			13,282			13,811			14,720			20,595			20,438			20,306			6,495			47.0	%		40,310			61,339			21,029			52.2	%
	Other, net		2,199			2,376			2,480			2,499			2,336			2,424			2,464			(17	)		-0.7	%		7,056			7,223			168			2.4	%
	Revenues		140,407			143,774			140,058			148,508			162,042			162,841			165,269			25,211			18.0	%		424,239			490,151			65,912			15.5	%

Benefits and expenses:
	Amortization of DAC		1,734			2,310			2,780			(656	)		3,442			2,080			2,349			(431	)		-15.5	%		6,824			7,870			1,046			15.3	%
	Insurance commissions		2,959			3,050			3,219			3,278			3,199			3,132			3,193			(26	)		-0.8	%		9,227			9,525			297			3.2	%
	Sales commissions:
	Sales-based		43,209			43,253			38,338			41,261			46,259			45,905			45,634			7,295			19.0	%		124,800			137,797			12,997			10.4	%
	Asset-based		27,630			28,965			30,220			31,698			32,484			33,350			34,813			4,593			15.2	%		86,815			100,646			13,831			15.9	%
	Other operating expenses		27,756			26,512			26,451			25,945			36,673			35,147			34,228			7,777			29.4	%		80,719			106,048			25,329			31.4	%
	Benefits and expenses		103,288			104,090			101,008			101,526			122,057			119,613			120,217			19,209			19.0	%		308,386			361,886			53,501			17.3	%
	Income before income taxes	$	37,119		$	39,684		$	39,050		$	46,982		$	39,985		$	43,228		$	45,052		$	6,002			15.4	%	$	115,853		$	128,265		$	12,411			10.7	%

Corporate & Other Distributed Products
Revenues:
	Direct premiums	$	7,319		$	6,941		$	7,249		$	6,532		$	6,721		$	6,686		$	7,039		$	(210	)		-2.9	%	$	21,509		$	20,446		$	(1,063	)		-4.9	%
	Ceded premiums		(1,692	)		(1,868	)		(1,869	)		(2,331	)		(1,688	)		(1,763	)		(1,843	)		25			1.4	%		(5,428	)		(5,295	)		133			2.5	%
	Net premiums		5,627			5,073			5,380			4,201			5,033			4,923			5,195			(185	)		-3.4	%		16,080			15,151			(929	)		-5.8	%
	Allocated net investment income		17,591			17,395			17,395			16,705			17,216			17,159			17,413			18			0.1	%		52,381			51,789			(592	)		-1.1	%
	Commissions and fees:
	Prepaid Legal Services		2,946			3,063			3,182			3,318			3,669			3,607			4,431			1,249			39.2	%		9,191			11,707			2,516			27.4	%
	Auto and Homeowners Insurance		1,815			2,166			1,980			2,238			1,347			1,800			1,516			(464	)		-23.4	%		5,961			4,662			(1,299	)		-21.8	%
	Other sales commissions		1,299			1,689			1,887			2,541			2,106			2,116			2,127			240			12.7	%		4,876			6,349			1,473			30.2	%
	Other, net		1,294			1,530			1,156			1,320			1,145			1,453			1,281			125			10.8	%		3,980			3,880			(100	)		-2.5	%
	Adjusted operating revenues		30,572			30,917			30,981			30,323			30,516			31,058			31,964			984			3.2	%		92,469			93,539			1,070			1.2	%

Benefits and expenses:
	Benefits and claims		4,615			3,980			4,513			4,700			4,059			3,314			4,799			286			6.3	%		13,107			12,172			(935	)		-7.1	%
	Amortization of DAC		(17	)		613			218			666			50			510			282			64			29.1	%		814			842			28			3.5	%
	Insurance commissions		532			461			500			382			450			428			455			(44	)		-8.9	%		1,493			1,334			(159	)		-10.7	%
	Insurance expenses		1,904			1,988			1,551			1,961			2,153			2,169			2,118			567			36.6	%		5,443			6,440			997			18.3	%
	Sales commissions		2,865			3,221			3,463			3,864			3,777			3,700			4,141			678			19.6	%		9,550			11,618			2,068			21.7	%
	Interest expense		7,127			7,144			7,074			7,143			7,173			7,229			7,216			142			2.0	%		21,345			21,617			273			1.3	%
	Other operating expenses		24,980			18,763			19,077			19,817			26,554			19,936			20,484			1,407			7.4	%		62,819			66,974			4,155			6.6	%
	Benefits and expenses		42,006			36,170			36,395			38,532			44,216			37,287			39,495			3,099			8.5	%		114,571			120,998			6,426			5.6	%
	Adjusted operating income before income taxes	$	(11,434	)	$	(5,254	)	$	(5,415	)	$	(8,209	)	$	(13,700	)	$	(6,228	)	$	(7,531	)	$	(2,116	)		-39.1	%	$	(22,102	)	$	(27,459	)	$	(5,357	)		-24.2	%

																							YOY Q3												YOY YTD
(Dollars in thousands)		Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$ Change			% Change			YTD 2017			YTD 2018			$ Change			% Change
Term Life Insurance Income Before Income Taxes
	Revenues:
	Direct Premiums	$	620,379		$	630,485		$	638,830		$	644,373		$	649,366		$	660,505		$	663,183		$	24,353			3.8	%	$	1,889,695		$	1,973,054		$	83,359			4.4	%
	Premiums ceded to IPO coinsurers (1)		(312,982	)		(308,323	)		(304,580	)		(300,144	)		(294,301	)		(290,956	)		(284,742	)		19,838			6.5	%		(925,884	)		(869,999	)		55,885			6.0	%
	Adjusted direct premiums (2)		307,397			322,163			334,251			344,230			355,065			369,548			378,441			44,190			13.2	%		963,811			1,103,055			139,244			14.4	%
	Other ceded premiums (3)		(85,095	)		(95,852	)		(91,193	)		(94,843	)		(98,260	)		(110,730	)		(104,590	)		(13,397	)		-14.7	%		(272,140	)		(313,580	)		(41,439	)		-15.2	%
	Net premiums		222,302			226,311			243,058			249,387			256,805			258,818			273,851			30,793			12.7	%		691,671			789,475			97,805			14.1	%
	Allocated net investment income		2,303			2,347			2,527			2,754			3,089			3,246			3,506			979			38.8	%		7,177			9,841			2,664			37.1	%
	Other, net		9,446			10,244			10,655			10,890			10,415			10,913			10,615			(40	)		-0.4	%		30,345			31,943			1,598			5.3	%
	Revenues		234,051			238,902			256,240			263,031			270,309			272,978			287,972			31,732			12.4	%		729,192			831,259			102,066			14.0	%

	Benefits and expenses:
	Benefits and claims		97,771			95,532			101,351			103,559			112,831			101,755			113,988			12,637			12.5	%		294,653			328,574			33,921			11.5	%
	Amortization of DAC		50,133			44,937			50,386			56,294			56,673			51,257			56,904			6,518			12.9	%		145,456			164,834			19,377			13.3	%
	Insurance commissions		1,408			1,646			1,874			1,799			2,228			2,856			2,936			1,061			56.6	%		4,929			8,019			3,091			62.7	%
	Insurance expenses		35,717			34,932			36,086			33,142			38,956			41,282			39,807			3,722			10.3	%		106,734			120,045			13,311			12.5	%
	Benefits and expenses		185,029			177,047			189,697			194,794			210,688			197,150			213,635			23,937			12.6	%		551,773			621,473			69,700			12.6	%
	Income before income taxes	$	49,022		$	61,855		$	66,543		$	68,237		$	59,621		$	75,827		$	74,338		$	7,795			11.7	%	$	177,420		$	209,786		$	32,366			18.2	%

Total Term Life Insurance - Financial Analysis
	Primary direct premiums (4)	$	227,390		$	240,580		$	250,457		$	258,524		$	267,615		$	280,209		$	287,554		$	37,097			14.8	%	$	718,427		$	835,379		$	116,951			16.3	%
	Legacy direct premiums (5)		392,989			389,906			388,373			385,849			381,751			380,295			375,629			(12,745	)		-3.3	%		1,171,268			1,137,675			(33,593	)		-2.9	%
	Total direct premiums	$	620,379		$	630,485		$	638,830		$	644,373		$	649,366		$	660,505		$	663,183		$	24,353			3.8	%	$	1,889,695		$	1,973,054		$	83,359			4.4	%

	Premiums ceded to IPO coinsurers	$	312,982		$	308,323		$	304,580		$	300,144		$	294,301		$	290,956		$	284,742		$	(19,838	)		-6.5	%	$	925,884		$	869,999		$	(55,885	)		-6.0	%
	% of Legacy direct premiums		79.6	%		79.1	%		78.4	%		77.8	%		77.1	%		76.5	%		75.8	%	nm			nm				79.0	%		76.5	%	nm			nm

	Benefits and claims, net (6)	$	182,866		$	191,384		$	192,544		$	198,402		$	211,091		$	212,485		$	218,577		$	26,034			13.5	%	$	566,794		$	642,154		$	75,360			13.3	%
	% of adjusted direct premiums		59.5	%		59.4	%		57.6	%		57.6	%		59.5	%		57.5	%		57.8	%	nm			nm				58.8	%		58.2	%	nm			nm

	DAC amortization & insurance commissions	$	51,542		$	46,584		$	52,260		$	58,094		$	58,901		$	54,113		$	59,839		$	7,579			14.5	%	$	150,385		$	172,853		$	22,468			14.9	%
	% of adjusted direct premiums		16.8	%		14.5	%		15.6	%		16.9	%		16.6	%		14.6	%		15.8	%	nm			nm				15.6	%		15.7	%	nm			nm

	Insurance expenses, net (7)	$	26,271		$	24,687		$	25,431		$	22,251		$	28,541		$	30,369		$	29,193		$	3,762			14.8	%	$	76,389		$	88,102		$	11,713			15.3	%
	% of adjusted direct premiums		8.5	%		7.7	%		7.6	%		6.5	%		8.0	%		8.2	%		7.7	%	nm			nm				7.9	%		8.0	%	nm			nm

	Total Term Life income before income taxes	$	49,022		$	61,855		$	66,543		$	68,237		$	59,621		$	75,827		$	74,338		$	7,795			11.7	%	$	177,420		$	209,786		$	32,366			18.2	%
	Term Life operating margin (8)		15.9	%		19.2	%		19.9	%		19.8	%		16.8	%		20.5	%		19.6	%	nm			nm				18.4	%		19.0	%	nm			nm

																								YOY Q3												YOY YTD
(Dollars in thousands, except as noted)			Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$/# Change			% Change			YTD 2017			YTD 2018			$/# Change			% Change
Key Statistics

Life-insurance licensed sales force, beginning of period				116,827			117,907			121,471			124,436			126,121			127,182			130,156			8,685			7.1	%		116,827			126,121			9,294			8.0	%
	New life-licensed representatives			10,903			12,947			12,783			11,902			11,730			13,544			11,715			(1,068	)		-8.4	%		36,633			36,989			356			1.0	%
	Non-renewal and terminated representatives			(9,823	)		(9,383	)		(9,818	)		(10,217	)		(10,669	)		(10,570	)		(11,213	)		(1,395	)		-14.2	%		(29,024	)		(32,452	)		(3,428	)		-11.8	%
Life-insurance licensed sales force, end of period				117,907			121,471			124,436			126,121			127,182			130,156			130,658			6,222			5.0	%		124,436			130,658			6,222			5.0	%

Estimated annualized issued term life premium ($mills) (1):
	Premium from new policies		$	59.4		$	70.2		$	65.8		$	67.6		$	60.4		$	71.1		$	64.6		$	(1.3	)		-1.9	%	$	195.5		$	196.1		$	0.6			0.3	%
	Additions and increases in premium			15.1			16.5			16.4			17.5			16.9			18.7			18.4			2.0			12.2	%		48.0			53.9			5.9			12.4	%
		Total estimated annualized issued term life premium	$	74.5		$	86.7		$	82.2		$	85.1		$	77.3		$	89.8		$	82.9		$	0.7			0.9	%	$	243.4		$	250.0		$	6.6			2.7	%

Issued term life policies				70,642			84,033			78,056			80,068			70,821			83,754			74,892			(3,164	)		-4.1	%		232,731			229,467			(3,264	)		-1.4	%
Estimated average annualized issued term life premium per policy (1)(2)			$	841		$	836		$	843		$	845		$	853		$	849		$	862		$	19			2.2	%	$	840		$	855		$	15			1.8	%

Term life face amount in-force, beginning of period ($mills)			$	728,385		$	733,756		$	746,427		$	757,411		$	763,831		$	765,732		$	773,604		$	27,177			3.6	%	$	728,385		$	763,831		$	35,446			4.9	%
	Issued term life face amount (3)			21,628			25,458			24,035			24,515			22,258			26,001			23,728			(307	)		-1.3	%		71,121			71,987			866			1.2	%
	Terminated term life face amount			(16,704	)		(14,994	)		(16,331	)		(17,929	)		(17,788	)		(16,341	)		(17,638	)		(1,306	)		-8.0	%		(48,029	)		(51,766	)		(3,737	)		-7.8	%
	Foreign currency impact, net			447			2,207			3,280			(165	)		(2,570	)		(1,788	)		1,582			(1,698	)		-51.8	%		5,934			(2,776	)		(8,710	)	nm
Term life face amount in-force, end of period			$	733,756		$	746,427		$	757,411		$	763,831		$	765,732		$	773,604		$	781,276		$	23,865			3.2	%	$	757,411		$	781,276		$	23,865			3.2	%

(1) Estimated annualized issued term life premium - estimated as average premium per $1,000 of face amounts issued on new policies and additions (before free look returns) multiplied by actual face amount issued on new policies, rider additions and face amount increases.

(3) Issued term life face amount - includes face amount on issued term life policies, additional riders added to existing policies, and face increases under increasing benefit riders.

																							YOY Q3												YOY YTD
(Dollars in thousands, except as noted)		Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$ Change			% Change			YTD 2017			YTD 2018			$ Change		% Change
Investment & Savings Products Income Before Income Taxes
	Revenues:
	Commissions and fees:
	Sales-based	$	60,517		$	60,692		$	53,488		$	58,307		$	64,461		$	64,307		$	64,181		$	10,693			20.0	%	$	174,697		$	192,949		$	18,252		10.4	%
	Asset-based		64,474			67,424			70,279			72,982			74,649			75,672			78,318			8,040			11.4	%		202,176			228,640			26,464		13.1	%
	Account-based		13,217			13,282			13,811			14,720			20,595			20,438			20,306			6,495			47.0	%		40,310			61,339			21,029		52.2	%
	Other, net		2,199			2,376			2,480			2,499			2,336			2,424			2,464			(17	)		-0.7	%		7,056			7,223			168		2.4	%
	Revenues		140,407			143,774			140,058			148,508			162,042			162,841			165,269			25,211			18.0	%		424,239			490,151			65,912		15.5	%

	Benefits and expenses:
	Amortization of DAC		1,734			2,310			2,780			(656	)		3,442			2,080			2,349			(431	)		-15.5	%		6,824			7,870			1,046		15.3	%
	Insurance commissions		2,959			3,050			3,219			3,278			3,199			3,132			3,193			(26	)		-0.8	%		9,227			9,525			297		3.2	%
	Sales commissions:
	Sales-based		43,209			43,253			38,338			41,261			46,259			45,905			45,634			7,295			19.0	%		124,800			137,797			12,997		10.4	%
	Asset-based		27,630			28,965			30,220			31,698			32,484			33,350			34,813			4,593			15.2	%		86,815			100,646			13,831		15.9	%
	Other operating expenses		27,756			26,512			26,451			25,945			36,673			35,147			34,228			7,777			29.4	%		80,719			106,048			25,329		31.4	%
	Benefits and expenses		103,288			104,090			101,008			101,526			122,057			119,613			120,217			19,209			19.0	%		308,386			361,886			53,501		17.3	%
	Income before income taxes	$	37,119		$	39,684		$	39,050		$	46,982		$	39,985		$	43,228		$	45,052		$	6,002			15.4	%	$	115,853		$	128,265		$	12,411		10.7	%

Financial Analysis

	Fees paid based on client asset values (1)	$	4,884		$	5,088		$	5,440		$	5,697		$	5,690		$	5,833		$	6,037		$	597			11.0	%	$	15,413		$	17,560		$	2,147		13.9	%
	Fees paid based on fee-generating positions (2)		5,017			4,590			4,495			4,537			12,495			10,854			10,223			5,728			127.4	%		14,102			33,573			19,471		138.1	%
	Other operating expenses		17,855			16,834			16,516			15,711			18,488			18,460			17,968			1,452			8.8	%		51,205			54,916			3,711		7.2	%
	Total other operating expenses	$	27,756		$	26,512		$	26,451		$	25,945		$	36,673		$	35,147		$	34,228		$	7,777			29.4	%	$	80,719		$	106,048		$	25,329		31.4	%

	Sales-based net revenue as % of revenue-generating sales (3)
	U.S.		1.27	%		1.25	%		1.26	%		1.28	%		1.24	%		1.27	%		1.26	%	nm			nm				1.26	%		1.25	%	nm		nm
	Canada		1.01	%		0.99	%		0.98	%		0.97	%		1.05	%		0.95	%		0.90	%	nm			nm				0.99	%		0.98	%	nm		nm
	Total		1.23	%		1.21	%		1.22	%		1.24	%		1.20	%		1.22	%		1.21	%	nm			nm				1.22	%		1.21	%	nm		nm

	Asset-based net revenue as % of average asset values (4)
	U.S.		0.035	%		0.036	%		0.036	%		0.036	%		0.036	%		0.037	%		0.037	%	nm			nm				0.107	%		0.110	%	nm		nm
	Canada		0.129	%		0.123	%		0.120	%		0.154	%		0.111	%		0.123	%		0.121	%	nm			nm				0.372	%		0.355	%	nm		nm
	Total		0.051	%		0.050	%		0.050	%		0.055	%		0.048	%		0.051	%		0.050	%	nm			nm				0.150	%		0.150	%	nm		nm

	Account-based net revenue per average fee generating position (5)(6)	$	2.84		$	2.98		$	3.20		$	3.52		$	2.90		$	3.49		$	3.70		nm			nm			$	9.02		$	10.08		nm		nm

																										YOY Q3												YOY YTD
(Dollars in thousands, except as noted)					Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$/# Change			% Change			YTD 2017			YTD 2018			$/# Change			% Change
Key Statistics

	Product sales ($mills)
		U.S. Retail Mutual Funds			$	752.2		$	804.2		$	707.4		$	752.7		$	792.4		$	800.6		$	763.3		$	55.9			7.9	%	$	2,263.8		$	2,356.3		$	92.4			4.1	%
		Canada Retail Mutual Funds				232.8			182.7			170.8			199.3			276.2			199.2			181.7			10.9			6.4	%		586.3			657.1			70.8			12.1	%
		Indexed Annuities				80.9			83.6			64.2			58.4			67.5			71.9			78.8			14.6			22.8	%		228.7			218.3			(10.4	)		-4.5	%
		Variable Annuities and other				346.2			366.5			301.7			368.2			376.1			432.2			504.5			202.8			67.2	%		1,014.4			1,312.8			298.3			29.4	%
				Total sales-based revenue generating product sales		1,412.2			1,437.0			1,244.1			1,378.5			1,512.2			1,504.0			1,528.3			284.2			22.8	%		4,093.3			4,544.4			451.2			11.0	%
		Managed Accounts				70.8			72.4			125.4			159.7			188.8			204.3			190.5			65.0			51.9	%		268.5			583.6			315.1			117.3	%
		Segregated Funds				102.4			63.5			61.7			64.7			82.0			50.6			43.7			(18.0	)		-29.1	%		227.5			176.3			(51.2	)		-22.5	%
				Total product sales	$	1,585.3		$	1,572.8		$	1,431.2		$	1,602.9		$	1,783.0		$	1,758.9		$	1,762.4		$	331.2			23.1	%	$	4,589.3		$	5,304.4		$	715.1			15.6	%

		Canada Retail Mutual Funds			$	232.8		$	182.7		$	170.8		$	199.3		$	276.2		$	199.2		$	181.7		$	10.9			6.4	%	$	586.3		$	657.1		$	70.8			12.1	%
		Segregated Funds				102.4			63.5			61.7			64.7			82.0			50.6			43.7			(18.0	)		-29.1	%		227.5			176.3			(51.2	)		-22.5	%
			Total Canada product sales			335.2			246.2			232.5			264.0			358.2			249.8			225.4			(7.1	)		-3.1	%		813.9			833.4			19.6			2.4	%
			Total U.S. product sales			1,250.1			1,326.6			1,198.7			1,338.8			1,424.8			1,509.1			1,537.1			338.3			28.2	%		3,775.5			4,471.0			695.5			18.4	%
				Total product sales	$	1,585.3		$	1,572.8		$	1,431.2		$	1,602.9		$	1,783.0		$	1,758.9		$	1,762.4		$	331.2			23.1	%	$	4,589.3		$	5,304.4		$	715.1			15.6	%

	Client asset values, beginning of period ($mills)				$	52,339		$	54,925		$	56,591		$	58,671		$	61,167		$	60,821		$	61,777		$	5,186			9.2	%	$	52,339		$	61,167		$	8,828			16.9	%
		Inflows				1,585			1,573			1,431			1,603			1,783			1,759			1,762			331			23.1	%		4,589			5,304			715			15.6	%
		Outflows (1)				(1,266	)		(1,318	)		(1,258	)		(1,306	)		(1,571	)		(1,498	)		(1,499	)		(241	)		-19.2	%		(3,841	)		(4,568	)		(727	)		-18.9	%
				Net flows		320			255			174			297			212			261			264			90			51.9	%		748			736			(12	)	nm
		Foreign currency impact, net				47			241			354			(18	)		(283	)		(195	)		174			(180	)		-50.8	%		642			(304	)		(946	)	nm
		Change in market value, net and other (2)				2,219			1,170			1,552			2,217			(276	)		891			2,019			467			30.1	%		4,941			2,634			(2,307	)	nm
	Client asset values, end of period				$	54,925		$	56,591		$	58,671		$	61,167		$	60,821		$	61,777		$	64,234		$	5,563			9.5	%	$	58,671		$	64,234		$	5,563			9.5	%
		Annualized net flows as % of beginning of period asset values				2.4	%		1.9	%		1.2	%		2.0	%		1.4	%		1.7	%		1.7	%		0.5	%	nm				1.9	%		1.6	%		-0.3	%	nm

	Average client asset values ($mills)
		U.S. Retail Mutual Funds			$	26,899		$	27,890		$	28,756		$	29,826		$	30,674		$	30,348		$	31,439		$	2,682			9.3	%	$	27,849		$	30,820		$	2,972			10.7	%
		Canada Retail Mutual Funds				6,434			6,673			6,960			7,255			7,508			7,444			7,610			650			9.3	%		6,689			7,521			832			12.4	%
		Managed Accounts				1,954			2,084			2,246			2,494			2,739			2,930			3,179			933			41.5	%		2,095			2,949			854			40.8	%
		Indexed Annuities				1,699			1,774			1,836			1,890			1,939			1,997			2,049			212			11.6	%		1,770			1,995			225			12.7	%
		Variable Annuities and other				14,505			14,982			15,394			15,928			16,333			16,176			16,669			1,275			8.3	%		14,960			16,393			1,432			9.6	%
		Segregated Funds				2,331			2,375			2,463			2,513			2,510			2,402			2,417			(46	)		-1.9	%		2,390			2,443			53			2.2	%
				Total	$	53,823		$	55,778		$	57,656		$	59,906		$	61,704		$	61,297		$	63,363		$	5,706			9.9	%	$	55,752		$	62,121		$	6,369			11.4	%

		Canada Retail Mutual Funds			$	6,434		$	6,673		$	6,960		$	7,255		$	7,508		$	7,444		$	7,610		$	650			9.3	%	$	6,689		$	7,521		$	832			12.4	%
		Segregated Funds				2,331			2,375			2,463			2,513			2,510			2,402			2,417			(46	)		-1.9	%		2,390			2,443			53			2.2	%
			Total Canada average client assets			8,765			9,048			9,423			9,768			10,018			9,846			10,027			604			6.4	%		9,079			9,964			885			9.8	%
			Total U.S. average client assets			45,058			46,730			48,233			50,138			51,685			51,451			53,336			5,102			10.6	%		46,674			52,157			5,483			11.7	%
				Total average client assets	$	53,823		$	55,778		$	57,656		$	59,906		$	61,704		$	61,297		$	63,363		$	5,706			9.9	%	$	55,752		$	62,121		$	6,369			11.4	%

	Average number of fee-generating positions (thous) (3)
		Recordkeeping and custodial				2,218			2,237			2,235			2,215			2,130			2,086			2,066			(168	)		-7.5	%		2,230			2,094			(136	)		-6.1	%
		Recordkeeping only				670			676			678			677			665			660			657			(21	)		-3.1	%		675			661			(14	)		-2.1	%
				Total		2,887			2,913			2,913			2,892			2,795			2,746			2,723			(189	)		-6.5	%		2,905			2,755			(150	)		-5.2	%

				As of or for the period ended September 30, 2018
											% of Total						Avg
				Market		Amortized		Unrealized			Market			Amortized			Book			Avg
(Dollars in thousands)				Value		Cost		G/(L)			Value			Cost			Yield			Rating
Investment Portfolio by Asset Class

Cash and cash equivalents				$	225,378	$	225,378	$	-			9.8	%		9.8	%

Fixed Income:
	Treasury				30,336		30,412		(76	)		1.3	%		1.3	%		2.36	%	AAA
	Government				199,843		198,184		1,659			8.7	%		8.6	%		3.27	%	AA-
	Tax-Exempt Municipal				517		518		(1	)		0.0	%		0.0	%		1.28	%	AAA
	Corporate				1,269,839		1,273,491		(3,651	)		55.4	%		55.4	%		3.99	%	BBB+
	Mortgage-Backed				180,648		182,222		(1,574	)		7.9	%		7.9	%		3.50	%	AAA
	Asset-Backed				73,869		74,262		(393	)		3.2	%		3.2	%		3.11	%	AA
	CMBS				136,752		137,628		(876	)		6.0	%		6.0	%		4.14	%	AAA
	Private				131,992		132,850		(859	)		5.8	%		5.8	%		4.71	%	BBB
	Redeemable Preferred				3,060		2,947		113			0.1	%		0.1	%		5.79	%	BBB
			Total Fixed Income		2,026,856		2,032,514		(5,658	)		88.4	%		88.5	%		3.88	%	A

Equities:
	Perpetual Preferred				16,120		16,120		-			0.7	%		0.7	%
	Common Stock				16,834		16,834		-			0.7	%		0.7	%
	Mutual Fund				6,362		6,362		-			0.3	%		0.3	%
	Other				-		-		-			0.0	%		0.0	%
			Total Equities		39,317		39,317		-			1.7	%		1.7	%

			Total Invested Assets	$	2,291,550	$	2,297,209	$	(5,658	)		100.0	%		100.0	%

Corporate Portfolio by Sector

	Banking			$	160,906	$	161,657	$	(751	)		12.7	%		12.7	%
	Consumer Non Cyclical				157,758		158,933		(1,175	)		12.4	%		12.5	%
	Reits				121,215		121,831		(616	)		9.5	%		9.6	%
	Energy				114,470		114,142		328			9.0	%		9.0	%
	Insurance				106,219		106,945		(726	)		8.4	%		8.4	%
	Technology				101,019		101,315		(296	)		8.0	%		8.0	%
	Capital Goods				85,185		85,811		(626	)		6.7	%		6.7	%
	Communications				84,841		84,413		427			6.7	%		6.6	%
	Consumer Cyclical				80,074		80,088		(14	)		6.3	%		6.3	%
	Electric				77,388		77,143		245			6.1	%		6.1	%
	Basic Industry				69,447		68,952		496			5.5	%		5.4	%
	Transportation				47,012		47,863		(852	)		3.7	%		3.8	%
	Brokerage				33,233		33,099		134			2.6	%		2.6	%
	Finance Companies				12,284		12,435		(152	)		1.0	%		1.0	%
	Industrial Other				11,491		11,514		(22	)		0.9	%		0.9	%
	Natural Gas				4,572		4,574		(1	)		0.4	%		0.4	%
	Financial Other				1,747		1,780		(33	)		0.1	%		0.1	%
	Utility Other				981		998		(17	)		0.1	%		0.1	%
			Total Corporate portfolio	$	1,269,839	$	1,273,491	$	(3,651	)		100.0	%		100.0	%

Fixed-Maturity Securities - Effective Maturity


Effective maturity
		< 1 Yr.		$	237,351	$	235,461	$	1,890			11.7	%		11.6	%		4.58	%
		1-2 Yrs.			229,416		228,042		1,374			11.3	%		11.2	%		3.86	%
		2-5 Yrs.			805,108		806,988		(1,880	)		39.7	%		39.7	%		3.67	%
		5-10 Yrs.			700,449		709,616		(9,166	)		34.6	%		34.9	%		3.84	%
		> 10 Yrs.			54,531		52,407		2,124			2.7	%		2.6	%		4.47	%
			Total Fixed Income	$	2,026,856	$	2,032,514	$	(5,658	)		100.0	%		100.0	%		3.88	%

Duration

Fixed Income portfolio duration					3.7	years

Note: Investment Portfolio pages in this Financial Supplement exclude the Held to Maturity asset on our balance sheet.

(Dollars in thousands)
Investment Portfolio Quality Ratings (1)
			Amortized Cost		% of Total
Total Fixed Income portfolio:
	Rating
	AAA		$	448,143		22.0	%
	AA			216,206		10.6	%
	A			451,553		22.2	%
	BBB			857,331		42.2	%
	Below Investment Grade			55,688		2.7	%
	NA			3,593		0.2	%
		Total Fixed Income	$	2,032,514		100.0	%




			Amortized Cost		% of Total							Amortized Cost		% of Total
Corporate asset class:								Private asset class:
	Rating								Rating
	AAA		$	16,069		1.3	%		AAA			$	-		—
	AA			101,312		8.0	%		AA				1,067		0.8	%
	A			375,316		29.5	%		A				13,588		10.2	%
	BBB			729,180		57.3	%		BBB				116,165		87.4	%
	Below Investment Grade			50,663		4.0	%		Below Investment Grade				2,030		1.5	%
	NA			950		0.1	%		NA				-		—
		Total Corporate	$	1,273,491		100.0	%				Total Private	$	132,850		100.0	%



CMBS asset class:								Mortgage-Backed asset class:
	Rating								Rating
	AAA		$	132,506		96.3	%		AAA			$	180,343		99.0	%
	AA			-		—			AA				1		0.0	%
	A			4,179		3.0	%		A				669		0.4	%
	BBB			-		—			BBB				537		0.3	%
	Below Investment Grade			942		0.7	%		Below Investment Grade				616		0.3	%
	NA			-		—			NA				56		0.0	%
		Total CMBS	$	137,628		100.0	%				Total Mortgage-Backed	$	182,222		100.0	%



Asset-Backed asset class:								Treasury & Government asset classes:
	Rating								Rating
	AAA		$	44,988		60.6	%		AAA			$	73,719		32.2	%
	AA			5,676		7.6	%		AA				108,149		47.3	%
	A			19,462		26.2	%		A				38,338		16.8	%
	BBB			1,380		1.9	%		BBB				7,121		3.1	%
	Below Investment Grade			168		0.2	%		Below Investment Grade				1,268		0.6	%
	NA			2,587		3.5	%		NA				0		0.0	%
		Total Asset-Backed	$	74,262		100.0	%				Total Treasury & Government	$	228,595		100.0	%



NAIC Designations

	1		$	935,132		53.0	%
	2			771,313		43.7	%
	3			45,353		2.6	%
	4			11,470		0.7	%
	5			976		0.1	%
	6			3		0.0	%			`
		U.S. Insurer Fixed Income (2)		1,764,247		100.0	%
	Other (3)			307,583
	Cash and cash equivalents			225,378
		Total Invested Assets	$	2,297,209

Note: Investment Portfolio pages in this Financial Supplement exclude the Held to Maturity asset on our balance sheet.

																									YOY Q3
(Dollars in thousands)				Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			$ Change			% Change
Net Investment Income by Source
	Fixed-maturity securities (available-for-sale)			$	19,069		$	19,200		$	19,268		$	19,340		$	19,289		$	19,743		$	20,142		$	874		4.5%
	Fixed-maturity securities (held-to-maturity)				5,718			6,087			7,231			7,829			8,373			9,052			9,592			2,361		32.7%
	Equity Securities				535			515			525			519			513			466			482			(43	)	-8.2%
	Deposit asset underlying 10% reinsurance treaty				1,032			770			869			299			1,181			1,270			1,392			523		60.2%
	Deposit asset - Mark to Market				—			—			—			—			(1,288	)		(375	)		(297	)		(297	)	n/m
	Policy loans and other invested assets				305			317			395			397			411			390			391			(4	)	-1.0%
	Cash & cash equivalents				194			246			282			402			586			641			664			382		n/m
			Total investment income		26,853			27,135			28,570			28,786			29,065			31,187			32,366			3,796		13.3%
	Investment expenses				1,241			1,306			1,417			1,498			1,675			2,105			2,152			735		51.9%
	Interest Expense on Surplus Note				5,718			6,087			7,231			7,829			8,373			9,052			9,592			2,361		32.7%
			Net investment income	$	19,894		$	19,742		$	19,922		$	19,459		$	19,017		$	20,030		$	20,622		$	700		3.5%
		Fixed income book yield, end of period			4.18	%		4.11	%		4.04	%		3.97	%		3.92	%		3.91	%		3.88	%		—			—
		New money yield			2.31	%		2.83	%		2.85	%		2.28	%		2.43	%		3.16	%		3.34	%					—

																									YOY Q3
				Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018			% Pt Change
Fixed Income Portfolio Quality Ratings
	Rating
	AAA				17.4	%		17.3	%		18.6	%		19.2	%		19.8	%		20.9	%		22.0	%		3.4	%
	AA				9.5	%		8.4	%		8.5	%		8.4	%		8.6	%		9.8	%		10.6	%		2.1	%
	A				21.6	%		23.5	%		22.5	%		22.2	%		23.4	%		23.0	%		22.2	%		-0.3	%
	BBB				46.0	%		45.8	%		46.3	%		46.5	%		44.6	%		43.0	%		42.2	%		-4.1	%
	Below Investment Grade				5.0	%		4.5	%		3.7	%		3.5	%		3.4	%		3.1	%		2.7	%		-1.0	%
	NA				0.4	%		0.3	%		0.3	%		0.2	%		0.2	%		0.2	%		0.2	%		-0.1	%
			Total Fixed Income		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%	nm

			Average rating by amortized cost	A-			A-			A-			A			A			A			A			na

				As of September 30, 2018									As of September 30, 2018						As of September 30, 2018
				Market Value			Amortized Cost			Credit Rating			Market Value		Amortized Cost				Market Value		Amortized Cost
Top 25 Exposures											Foreign Exposure (1)						Government Investments (1)

	1	Canada		$	24,430		$	24,524		AAA	Canada		$	65,008	$	65,155	AAA		$	3,194	$	3,250
	2	Province of Quebec Canada			13,432			12,904		AA-	Australia			53,008		53,006	AA			13,658		13,794
	3	Province of British Columbia Canada			11,966			12,047		AAA	United Kingdom			43,176		43,425	A			11,211		11,064
	4	Province of Alberta Canada			11,324			11,396		A+	France			19,451		19,441	BBB			7,234		7,121
	5	Province of Ontario Canada			11,122			10,994		A+	Germany			18,895		19,193	Below Investment Grade			1,249		1,268
	6	Wells Fargo & Co			10,898			10,901		A-	Switzerland			15,132		15,268	NA			—		—
	7	Municipal Finance Authority of British Columbia			10,504			10,692		AAA	Ireland			15,011		15,149		Total	$	36,545	$	36,497
	8	Comcast Corp			10,405			10,510		A-	Bermuda			14,491		14,462
	9	City of Toronto Canada			9,385			9,538		AA	Cayman Islands			10,681		10,584
	10	AT&T Inc			9,350			8,778		BBB+	Japan			10,227		10,200	Non-Government Investments (1)
	11	Province of Manitoba Canada			9,012			9,080		A+	Netherlands			9,721		9,030
	12	Enbridge Inc			8,294			8,312		BBB+	Mexico			6,386		6,251	AAA		$	3,271	$	3,267
	13	National Rural Utilities Cooperative			8,261			8,182		A	Belgium			6,123		6,117	AA			34,531		35,028
	14	Microsoft Corp			7,919			7,911		AAA	Norway			5,871		5,980	A			97,072		97,516
	15	City of Montreal Canada			7,827			7,647		AA-	Israel			5,207		5,261	BBB			168,081		167,053
	16	American Airlines Group Inc			7,610			7,964		AA-	Emerging Markets (2)			12,471		12,416	Below Investment Grade			4,766		4,963
	17	Morgan Stanley			7,426			7,468		A+	All Other			33,407		33,385	NA			—		—
	18	US Bancorp			7,310			7,266		A+		Total	$	344,266	$	344,323		Total	$	307,720	$	307,827
	19	Province of Newfoundland and Labrador			7,077			6,800		A
	20	General Mills Inc			7,030			7,319		BBB
	21	Bank of New York Mellon Corp			6,970			6,998		AA-
	22	Discovery Inc			6,881			6,791		BBB-
	23	Bank of America Corp			6,837			6,859		A-
	24	Booking Holdings Inc			6,822			7,025		A-
	25	Brookfield Asset Management Inc			6,818			6,879		A-
			Total	$	234,912		$	234,785

			% of total fixed income portfolio		10.3	%		10.2	%

Note: Investment Portfolio pages in this Financial Supplement exclude the Held to Maturity asset on our balance sheet.

(Dollars in millions)			2013			2014			2015			2016			2017			Q1 2017			Q2 2017			Q3 2017			Q4 2017			Q1 2018			Q2 2018			Q3 2018


Recruits				186,251			190,439			228,115			262,732			303,867			70,983			78,273			90,210			64,401			76,230			76,520			76,146


Life-insurance licensed sales force, beginning of period				92,373			95,566			98,358			106,710			116,827			116,827			117,907			121,471			124,436			126,121			127,182			130,156
	New life-licensed representatives			34,155			33,832			39,632			44,724			48,535			10,903			12,947			12,783			11,902			11,730			13,544			11,715
	Non-renewal and terminated representatives			(30,962	)		(31,040	)		(31,280	)		(34,607	)		(39,241	)		(9,823	)		(9,383	)		(9,818	)		(10,217	)		(10,669	)		(10,570	)		(11,213	)
Life-insurance licensed sales force, end of period				95,566			98,358			106,710			116,827			126,121			117,907			121,471			124,436			126,121			127,182			130,156			130,658


Issued term life policies				214,617			220,984			260,059			298,244			312,799			70,642			84,033			78,056			80,068			70,821			83,754			74,892


Issued term life face amount			$	67,783		$	69,574		$	79,111		$	89,869		$	95,635		$	21,628		$	25,458		$	24,035		$	24,515		$	22,258		$	26,001		$	23,728


Term life face amount in force, beginning of period			$	670,412		$	674,868		$	681,927		$	693,194		$	728,385		$	728,385		$	733,756		$	746,427		$	757,411		$	763,831		$	765,732		$	773,604
	Issued term life face amount			67,783			69,574			79,111			89,869			95,635			21,628			25,458			24,035			24,515			22,258			26,001			23,728
	Terminated term life face amount			(57,730	)		(54,962	)		(53,580	)		(57,238	)		(65,958	)		(16,704	)		(14,994	)		(16,331	)		(17,929	)		(17,788	)		(16,341	)		(17,638	)
	Foreign currency impact, net			(5,596	)		(7,553	)		(14,263	)		2,560			5,769			447			2,207			3,280			(165	)		(2,570	)		(1,788	)		1,582
Term life face amount in force, end of period			$	674,868		$	681,927		$	693,194		$	728,385		$	763,831		$	733,756		$	746,427		$	757,411		$	763,831		$	765,732		$	773,604		$	781,276


Estimated annualized issued term life premium
	Premium from new policies		$	173.5		$	179.8		$	212.4		$	245.2		$	263.1		$	59.4		$	70.2		$	65.8		$	67.6		$	60.4		$	71.1		$	64.6
	Additions and increases in premium			48.6			51.6			54.9			60.4			65.5			15.1			16.5			16.4			17.5			16.9			18.7			18.4
		Total estimated annualized issued term life premium	$	222.1		$	231.4		$	267.3		$	305.7		$	328.6		$	74.5		$	86.7		$	82.2		$	85.1		$	77.3		$	89.8		$	82.9


Investment & Savings product sales			$	5,208.8		$	5,682.3		$	5,856.8		$	5,594.3		$	6,192.2		$	1,585.3		$	1,572.8		$	1,431.2		$	1,602.9		$	1,783.0		$	1,758.9		$	1,762.4

Investment & Savings average client asset values			$	41,035		$	46,936		$	48,477		$	49,427		$	56,791		$	53,823		$	55,778		$	57,656		$	59,906		$	61,704		$	61,297		$	63,363

	Page
Preface, definition of Non-GAAP financial measures	3
Condensed balance sheets and reconciliation of balance sheet non-GAAP to GAAP financial measures	4
Financial results and other statistical data	5
Statements of income	6
Reconciliation of statement of income GAAP to non-GAAP financial measures	7
Segment operating results	8
Term Life Insurance segment - financial results, key statistics, and financial analysis	9-10
Investment and Savings Products segment - financial results, financial analysis, and key statistics	11-12
Investment portfolio	13-15
Five-year historical key statistics	16