Torchmark aims to be a beacon in the world of insurance. It is the holding company for a family of firms; its member companies specialize in lower-end individual life insurance and supplemental health insurance. Torchmark subsidiaries, which include flagship Liberty National Life, offer whole and term life insurance, supplemental health insurance, accidental death insurance, Medicare supplements, and long-term care health policies for the elderly. Its American Income Life sells life insurance policies to labor union and credit union members in the US, Canada, and New Zealand. Torchmark sells its products through direct marketing, as well as a network of exclusive and independent agents.
Targeting middle-income citizens, Liberty National Life operates primarily in the southeastern US. Torchmark's United American Insurance subsidiary writes supplemental health coverage and Medicare supplemental insurance. A smaller subsidiary, Globe Life and Accident, offers sells life insurance and supplemental health products direct to consumers through print, online, and television ads.
Torchmark's operations are based in Oklahoma and Texas, although its services extend to customers across the US and in New Zealand and Canada.
The company reported a revenue increase of 0.29% in 2011 over 2010, due to a marginal increase in total premiums, thanks to higher revenues from life, health, and other premiums. The increase was also due to better returns from net investment income, realized investment gains, and a decrease in other-than-temporary impairments.
Torchmark also had a marginal increase in net income in 2011 due to a slight increase in revenues, which just outpaced a rise in total benefits costs and other expenses.
Many of Torchmark's subsidiaries are registered in Nebraska to take advantage of lower tax rates.
Unlike many other life insurers, Torchmark makes the bulk of its revenues from its premiums, and relatively little (21% in 2011) from its investments. This allows it to ride out the economic downturns more smoothly while other life insurers take significant revenue hits when their investments fizzle.
To build up its supplemental health and life business, the company acquired Family Heritage Life Insurance Company of America for $232 million.
At the close of 2010, Torchmark sold its United Investors Life Insurance Company to Protective Life. The sale brought in some $343 million and allowed Torchmark to exit the more volatile business of variable annuities. – less