38
Dear Friends b 3
Dear Kris b 9
The Sabbath Year b 11
Management’s Discussion & Analysis b 24
Financial Highlights b 31
Five-Year Summary b 31
Balance Sheet b 32
Summary of Operations b 33
Statement of Shareholder’s Equity b 34
Statement of Cash Flow b 34
Earlier, I referred to being intentional about staying the course. You might be wondering, “What does
it mean to be intentional about ‘staying the course’?” For me, being intentional means making
every action count -- knowing what we are doing and why we are doing it. Biblical scripture says in
the book of Joshua (chapter 1, verse 7), “Be strong and very courageous. Be careful to obey all the law
my servant Moses gave you; do not turn from it to the right or to the left, that you may be
successful wherever you go.” (emphasis added). I like the picture of not turning to the right or to
the left -- this is intentionally staying the course!
2009 3
What an interesting and challenging year
2009 was. For our company, it was another
record year, but for me personally it was a year
of true awakening.
After coming out of 2008, where the financial
markets failed in the last four months of the year,
we began the year by attempting to make an
assessment of where our country was headed
economically. No one really knew and experts were
stumped. All that kept coming to my mind about
our company was “be intentional about staying the
course.” Funeral Directors Life Insurance
Company (FDLIC) has had a solid investment
strategy and a sound business plan for twenty
years, so I really saw no reason for us to not believe
that the principles we had preached and followed for
so many years would not survive under fire (I mean
businessesdeveloptheirplansand strategies inorder
to withstand the bad times, right?). We stood firm,
we kept the faith, and we came through the fire!
In fact, we did more than just come through
the fire, we accelerated and sped past! Every
month during 2009 was a new record sales
month for FDLIC (by the end of 2009,
we had recorded 40 consecutive record sales
months!). While other financial services
businesses were reeling over the United States’
tumultuous financial markets, FDLIC was growing
and prospering. Literally, I was in total awe
and amazement.
That is why I felt impressed to give something
back to God. Through His guidance, wisdom,
and protective hand, we (me personally, our
management team, and our company) had been
more than saved, we had been blessed! And
thus grew the idea of the Sabbath Year for FDLIC
-- where we would give every employee the
opportunity to take 10% (a tithe of sorts) of the
year off for rest, redemption, reflection, reward,
repair, relationships, and time to refocus.
Here were the keys to intentionally staying the course during 2009:
1. Have a purpose worth living for. At FDLIC, we have established a culture of serving. All of
our people see that helping others is a purpose worth living for. In fact one of our five Strategic
Objectives is To Be Known as Helpers of People. During 2009, our Helpers of People Charitable
Contribution matching program seemed to really take off. More than any other year, we matched
charitable contributions that were made by our client funeral homes and by our employees. We see
our opportunity to match the charitable giving of our funeral home clients and our employees
as a way of supporting worthy causes that are of importance and value to the people closest to us.
This program has allowed us to help organizations and people far beyond our corporate circle of
influence in an intentional and meaningful way.
In addition, FDLIC has seen increased use in our HOPE fund. The HOPE fund (Helping Our
People Excel) is a program that we established to assist our employees with the “issues” of life,
which range from financial concerns to marital problems to teenager issues to spiritual dilemmas.
In other words, the HOPE fund is our means of establishing a safe place for our employees to share
personal problems and issues in a confidential manner so that our company can provide help
and assistance. In essence, we know that our employees spend most of their waking hours here,
at work, and we want them to know that we care about them. We are a community of 135 people,
every one of us has problems, and all of us need help once in a while. Originally, our HOPE
fund was established to help our employees with personal financial problems, but through the
leadership of Ray Thompson, our HOPE fund has turned out to be considerably more.
2. Know our strengths and weaknesses. I once heard it said that playing to your strengths renews
your energy and your passion. One of our most significant strengths is providing a
“great place to work” for all of our team members. Another of our five Strategic Objectives is
To Be Known as a Great Place to Work. With a focus on being a great place to work, we have
established an environment, a culture so to speak, that has been described to me as “family” --
to me, that is the most meaningful compliment that we could ever receive.
In 2009, we did a number of things to improve on this strategic objective:
Announcing and implementing the Sabbath Year concept. I had no idea that the Sabbath
Year concept would be received as well as it was received by our people. They embraced
the idea and came up with creative and meaningful ways to use the 30-days that we were
giving them. In fact, I am extremely excited to see the fruit from our people taking a
Sabbath after everyone has had a chance to participate.
4 2009
2009 5
The completion of a significant renovation project at our home office. FDLIC made
considerable home office building improvements to our Management Information
Systems Department and our Human Resources Department. These renovations were
long overdue, but they have been appreciated by all of our staff.
Continuation of our monthly staff luncheons and our Performance Plus program. As a
means to keep our home office personnel informed about everything that is going on at
FDLIC, we began having monthly luncheons more than 20 years ago. These luncheons
have more or less taken on a life of their own and have become a fun, entertaining, and
informative family reunion (I think family reunion is the best way to describe the
environment). At these luncheons, we allow our people to give Performance Plus awards
to each other. Each employee is allowed to give up to two of these awards each year to
other employees that they see doing good work for the company and achieving one or
more of our Strategic Objectives. As you can imagine, the presentation of these awards
can get quite emotional and personal, which helps us in our attempt to create a great
place to work.
Upgrading technology. Surprisingly, most of our staff tell me that one of the primary
things that makes FDLIC a great place to work is the fact that we stay on the leading
edge of technology and supply our people with the technology they need to get their
job done efficiently and effectively. This amazes me because I would assume that all
companies would supply their people with the best in technology so that they can do
their jobs better, but I have been told that other companies do not. Each year, we dedicate
a portion of our budget toward improving our technology. In 2009, we upgraded our
telephone system, supplied the majority of our people with new computers, and updated
our software, which seemed to really excite and motivate them.
3. Prioritize our responsibilities. In order to intentionally stay the course, we have seen the
need to research and develop ideas that will grow our company. As my father used to tell me,
“You’re either growin’ or you are dyin’,” and I am a firm believer that in order to remain relevant,
your company has to grow. To Grow the Company is another one of our Strategic Objectives.
Over the past few years, we have subtly embarked on some new projects
that have helped us accomplish this strategic objective.
Regional Sales Vice Presidents: In order to
meet the needs of our existing and new client
funeral homes, we have had to shift some
sales management responsibilities outside of
our home office. As FDLIC has spanned out
across the United States, our Executive Management team was finding it more and more
difficult to supply the sales oversight that was needed. Consequently, we created the
Regional Sales Vice President position. Now, we have five Regional Sales Vice Presidents
that oversee the expansion of FDLIC from coast-to-coast.
Training: Our training department has grown in two years from one trainer to three.
We have found that solid sales training has been lacking in the preneed funeral
profession. We have made solid efforts toward building a quality sales management
team by training them to better serve our client funeral homes. Our next objective for
training will be to develop a strong program to assist sales producers to better represent
funeral service to the ultimate consumer.
Marketing Services: Today at FDLIC, we have more marketing services for our funeral
home clients to select from than ever before in the history of our company. We have
made a concerted effort to provide a variety of options in order to meet the needs of
each client, as we strive to become knowledgeable, trusted business advisors.
4. Learn to say “no.” For a guy who really likes to do entrepreneurial things, I have definitely had
to learn to say “no.” At times, I have said “yes” and a few (some would say many) of those “yes”
decisions did not turn out as well as I had expected. The founders of FDLIC had a vision, and that
vision centered around providing quality preneed funeral products and service to funeral homes
with the firm understanding that the funeral home is our customer.
This point was driven home to me early and often, and that is
why one of our Strategic Objectives is To Be the Leading Provider
of Service to the Funeral Industry. We have committed to this
strategic objective and to our statement of purpose which is
“To Be the Best, Most-Respected Provider of Service to the
Funeral Industry.” Consequently, we have learned, and some of
us continuously learn, that we cannot be all things to all people,
and we have to say “no” whenever something comes along (as good as
it may look) that ventures beyond our purpose. A famous Jewish Rabbi
named Jesus once said, “Simply let your ‘Yes’ be ‘Yes,’ and your ‘No’ be ‘No’;
anything beyond this comes from the evil one.” As with all of the principles that He taught us, we
must take this to heart.
5. Commit to long-term achievement. The only way that we could have prospered in this negative
economic environment of the past 16 months was through our commitment to long-term
achievement. We realize that life insurance is a long-term business, and our funeral home clients
and policy holders count on and trust us to manage their money well. In addition, they want to
6 2009
2009 7
know that they have placed their trust in a company that is financially sound and stable. Our final
Strategic Objective is To Achieve Good Financial Results. We know that if we focus on our first four
Strategic Objectives that good financial results will follow. We were very concerned in 2008
about our financial results which were negatively affected by our nation’s economic crisis, but after
seeing how peer insurance companies performed, we celebrated our achievement -- which leads us
to our 2009 financial results.
The financial results we achieved in 2009 were far beyond what would be considered good.
We rallied back from the difficult investment environment of 2008 and established record
results in 2009. Honestly, our stellar financial performance was not expected. Let me share with
you a few highlights:
Total sales for 2009 closed the year at $154.7 million (a new company record), a 12.82%
increase over 2008.
FDLIC closed 2009 with assets of $632.5 million (a new company record) as compared
to $556.6 million for 2008 (a 13.6% increase).
Capital and surplus ended 2009 at $57.8 million (a new company record), $9.2 million
better than where we ended 2008 (a 19.0% increase).
Even with a shaky investment environment, FDLIC had $6.0 million of net income
(a new company record), surpassing net income recorded in 2008 by 484.9%!
With all that happened in 2008 in the United States, we definitely needed a positive 2009.
We consider ourselves to be extremely blessed to have weathered the storm. Thanks be to God
for the wisdom that was given to us to establish a solid investment strategy and a strong business plan
more than 20 years ago, and thanks be to God for the courage to intentionally stay the course.
FINAL THOUGHTSAs I was putting my thoughts together for this letter, I bounced a few ideas and questions past
my assistant. She really did not have any initial suggestions, but a little later in the day she sent
me an email which describes our culture better than anything that I could have written. Here is what
she said:
As a new employee we are offered a position with a certain salary, job description, schedule,
etc. We are told of the many benefits, including employee luncheons, health care, fitness
center, possible incentive trips, holidays, etc. I say that to mention, in a short matter of time,
you realize the most important bonus (of being part of the FDLIC family) is not something
you can attend, have or use, it is our people.
Once you are hired, you are a part of the FDLIC family. One is not more important than
another; you are an integral part of an extraordinary team. Our executives, supervisors,
and Human Resources personnel screen and hire you to join the team knowing you are
capable of greatness. Personally, I have experienced encouragement to take on tasks
outside my so called “comfort level.” I won’t say I went “kicking and screaming,” but one
notch below that and I was amazed that it went well. A mentor is an unexpected gift.
Think about how many different people, personalities, backgrounds, education, etc. there
are in our company. When I write this I see the faces of Craig (Loper), Ray (Thompson),
Alicia (Rasco), Shaun (Gaffney), Iris (Williams), Gloria (Emmert), Heather (Guitar),
Alvino (Sanchez), Zack (Shahan), Loren (Tatom), Terri (Bannister), and Gloria (Lantzy).
We are able to engage each and every one’s talent and abilities and mesh them all together
and have extraordinary continual results. My gosh, this is priceless! We have the
wherewithal, passion, integrity and track record resulting in remarkable success in
the most turbulent times!
I may have used different vernacular, but I think that Angie (Holmes) has said it best -- our people
really do make the difference. And her thoughts are echoed throughout our home office. For this
reason, I truly felt impressed by God to give our people a Sabbath Year as a tithe -- God is
acknowledged and our people are rewarded!
Once again, I want to thank you for the confidence you have placed in our company. We value
and appreciate the opportunity to serve.
KRIS SEALEPresident & Chief Executive Officer
8 2009
Rest: At least 9 hours of rest per day, with 7 to 8 hours of nightly sleep and 1 to 2
hours of napping or reflective meditation.
Redemption: Time allotted for devotional or Bible study.
Reflection: Journaling, meditating, praying (can be in conjunction with the 1 to 2
hours of dedicated day-rest.)
Reward & Repair: Time for exercise, personal quiet time, and reading.
Relationships: Time to intentionally devote to friends and family, and specifically
to those relationships that have been strained or damaged.
Refocus: Time set aside for a mission trip or service project.
You spoke in your letter of “staying the course” with
this company throughout 2009. With business
plans, budget plans, and investment plans,
FDLIC maintains a steady course even in the
roughest of circumstances, and we are thankful
to be a part of such a steady and stable company.
We have not been blind to the fact that many
American workers are not so fortunate, and
we are more deeply grateful for your godly
leadership than we can adequately express.
And now, on top of giving us a great place to work
and a solid company to work for, you have done
what no corporate president to our knowledge
has ever done for his or her employees. You’ve
given us the opportunity to take a 30-day
Sabbatical. Wow! Some of us are still in shock
at the amazing generosity of this gift! We are
excited, nervous, joyful, and overwhelmed with
gratitude all at the same time.
We’ve recognized that the Sabbatical is as much
a blessing as it is a challenge. “Keep in mind what
the Sabbath Year is all about,” we were reminded
often. “Focus on your heart, on your renewal,
and your revival -- not someone else’s.” We know
this is going to be a challenge -- the kind that
stretches and grows you physically, emotionally,
and spiritually.
We would like to thank you also that you’re not
sending us out on our individual Sabbatical
journeys without some sense of direction.
We were all presented with Waking the Dead, a
wonderful book by John Eldredge, that inspires
us to understand what it means to be fully alive.
And, you have given us certain guidelines as
well…a map, so to speak, by which to chart
our course. Over the 30-day Sabbatical period,
you requested that we focus on areas in our lives
that often go neglected:
2009 9
From the bottom of our hearts, we would like to thank you for this opportunity…and also for this
challenge to discover our true priorities in life, to experience an awakening, and to embark on a
journey that we are certain will change us forever.
Thank you,Your FDLIC Family
10 2009
12 2009
RESTIf you were to ask the average American today how they were doing, they would automatically
respond: “Good, fine, everything’s great! Just keeping busy! Actually, I’m in a hurry right now. I really
have to go, but it was so nice seeing you!” Sound familiar? Very likely, we have all been this person at one
time or another.
Sadly, many Americans not only accept endless activity as a way of life, they wear it as a badge of honor,
even a sign of importance, equating constant busyness with success in life.
But in our heart of hearts, we know that simply cannot be true. We know that there must be more to
life than this.
What, after all, is the end result of all our restless energy? Our hearts grow cold and tired, we lose sight
of our dreams and our sense of wonder, we grow disillusioned, even despairing; our relationships suffer
from neglect, and normally, we’re on the point of exhaustion or breakdown. We yearn for something more:
for meaning, for purpose, for a full life! It is a cultural epidemic…why else would the book, A Purpose-Driven
Life, become such a runaway success? It is because as a society, we are caught in a cycle of living full, active
lifestyles devoid of any meaning or purpose.
In Waking the Dead, John Eldredge quotes Saint Irenaeus as having once said “The glory of God is manfully alive.” Eldredge comments on his initial surprise upon first reading this phrase: “…Really? I mean, is
that what you’ve been told? That the purpose of God -- the very thing he’s staked his reputation on -- is your
coming fully alive?”
While we may have an overabundance of activity, by no stretch of the imagination are we “fully alive.”
Could it be true that God is most glorified when our hearts are most fully alive? Then, we remember
his promise: “The thief comes only to steal, kill and destroy; I come that they may have life, and have it
abundantly” (John 10:10).
If we are tired and discouraged, if we have all but given up, if we feel like we don't even know what living
a full life would look like, there is hope. He says to us with compassion and gentleness: “Come to me,
all who are weary and heavy-laden, and I will give you rest. Take my yoke upon you and learn from me,
for I am gentle and humble in heart, and you will find rest for your souls. For my yoke is easy and my
burden is light” (Matthew 11:28-30). There is a rest available to us if we only accept it. But we have to let go
of our ideas of priorities on our time, our ideas of what success in life looks like, and the hardest of all --
our false sense of control.
It is a leap of faith, a jump into the unknown, but the rewards are eternally worth it.
WOW!It is hard to believe that the long-anticipated journey has begun! I usually am “much for words” but the primary word all along for me hasbeen simply, “WOW!” I am amazed and deeply grateful for this incrediblegift. And I do so want to use it wisely, to bless and to be blessed.I want to share from my experience in September, 2009, when I firstlearned of this Sabbatical opportunity.
Funeral Directors Life Insurance Company was celebrating a recordproduction for August. After enjoying the tasty spread and a few celebratory toasts, I switched places with my co-worker so I couldcover the phone. As folks later emerged from the festivities, therewas a buzz about “the Sabbatical.” Bits and pieces of informationwere given to me over the next few days, but I did not have a clearunderstanding yet. I was eager for the written explanation fromKris to come forth, which it soon did. A 30-day paid Sabbaticalwith opportunities for rest, redemption, reflection, reward andrepair, relationships, and time to refocus.
WOW! (that word again!) You are speechless and amazedwhen presented with such an incredible opportunity to knowGod and yourself better, to jump off that faith-cliff and see what happens that will forever change your life, to be able to “come away” for rest and renewal and all the other delightful “R’s”!
Susan Condry, FDLIC Company ReceptionistSABBATICAL: TRIP TO ISRAEL
2009 13
REDEMPTIONPerhaps one of the most moving films of our time is The Shawshank Redemption. In it, the story of a
man unfolds, a man who is wrongfully accused and put into jail for two consecutive life sentences. But with
the help of a friend, he is able to escape his life of captivity and walk into a life of freedom and hope.
Our hearts leap as the perfectly laid plans begin to unfold and the two friends are finally reunited on a
beautiful, peaceful beach, far away from their former prison walls.
Braveheart is yet another great film that resonates deeply with us. This is the story of a Scottish warrior who
defends his beloved Highlands against British invasion. His cry for “Freedom!” can bring tears to the eyes.
We know what he has suffered at the hands of the British, and we are certain that freedom is something
worth fighting for…it is even worth dying for.
When we allow ourselves time to stop, rest, and rejuvenate, our eyes begin to open and our hearts begin
to awaken to new truths. We slowly become aware that we have been living in an invisible prison. We are
serving a life sentence with no chance of parole! Hopelessly imprisoned by negative emotions, we battle
daily with feeling frustrated, worried, unappreciated, resentful, lonely, angry, and needy. We are trapped.
We desperately need freedom!
As Jesus began his ministry, he made an astonishing announcement. Quoting from the book of Isaiah,
he declared:
“The Spirit of the Lord is on me,
because he has anointed me
to preach good news to the poor.
He has sent me to proclaim freedom for the prisoners and recovery of sight for the blind,
to release the oppressed, to proclaim the year of the Lord’s favor.” (Luke 4:18-19, emphasis added)
Now, Jesus did not suddenly begin springing criminals from jail. Even his cousin, John the Baptist,
remained in prison and eventually died. No, Jesus was speaking of a different kind of prisoner: those who
were living in bondage, those who were blind both spiritually and physically, those who were oppressed and
forgotten. That’s good news, because that’s us!
Perhaps that is why films like The Shawshank Redemption and Braveheart are such powerful stories in our
lives. As these characters struggle for freedom, we recognize our own need for liberation -- from constant
worry, pain, fear, doubt, anger, bitterness, loneliness, brokenness. We have been oppressed, blinded, and
held prisoner against our will. We have labored under burdens too difficult to bear. We have strived
without ceasing and gotten nowhere. And we are painfully aware that it is impossible to live life to the
fullest in this state of oppression.
But there is good news. There is one who is fighting for our freedom.
14 2009
A POWERFUL MOMENTI was given the chance to share my testimony on the second day of the Pastor’sConference in Gopalpur, India. The reception that I received was incredible! I talked to them about my Christian walk and how God had really worked on my heartover the past seven years. Then, I told them about our company and how God had protected us from the financial crisis in America of 2008. I explained to the attendees that our company was offering a “Sabbath Year” to our employees in thanksfor what God had been doing in our company and in me personally. And as normal forme, tears were coming from my eyes.
At that point in my testimony, Pastor Obed (our host and interpreter) unexpectedly stopped me from going further, and he asked the attendees to pray for our company, to pray for our employees, and to pray for my leadership. Needless to say, I was overcome with emotion! Here were 170 orso pastors, who had been recently subject to persecution, subject to all kindsof threats, subject to their houses and churches being burned down, subject todoing whatever necessary to protect their families, and they were praying forus! Words just cannot express the power of that moment. As I completed my testimony, Pastor David came up and asked for any of the men in attendance to stand who needed to improve their relationship with their wife, improve their relationship with their family, and improve their relationship with the people that they work with -- and to my amazement, ALL of the men stood up! David asked me to pray over these men to close our session for the afternoon. Each day in India seems to be more intense and more amazing!
Kris Seale, FDLIC President & CEOSABBATICAL: TRIP TO INDIA
2009 15
REFLECTIONWhat is your deepest fear? Do you fear never being able to measure up? Or do you fear what others might
think if your full glory were revealed? What if your true self were laid bare for all the world to see?
In the story of The Lion King, young Simba has fled from his home in shame and guilt. He has been
told a lie and fears that he is responsible for his father’s death. All the while, he is running from his
responsibility and his calling. Then one day, Simba is told that his father still lives! Filled with amazement
and anticipation at seeing his father again, Simba is led to a pool where he looks in, only to find his own
reflection staring back at him. He is disappointed. But suddenly, he hears his father’s voice.
MUFASA: Simba.
SIMBA: Father?
MUFASA: Simba, you have forgotten me.
SIMBA: No! How could I?
MUFASA: You have forgotten who you are, and so forgotten me. Look inside yourself,
Simba…you are more than what you have become.
SIMBA: How can I go back? I’m not who I used to be.
MUFASA: Remember who you are. You are my son, and the one true king.
Remember who you are.
Remember who you are. Somehow, we sense that Mufasa is speaking to us, too. At first, we may feel
like running away when it is time to sit down and reflect on the direction of our lives. We’ve messed
up. Badly. We avoid stillness and reflection because it might bring up painful memories and wounds.
Or we might even have to face our own shame, guilt, and failure.
But then, something wonderful happens. Our Father says, “That’s not you. Forget about all that and
remember who you are. I have purchased your freedom, taken your failure, and given you my glory in
return. Now, go show it to the world!”
Are we inadequate to step into our destiny? Yes, there’s no question. But do we have help from
our Father? Absolutely. He lives in us, and it is his glory that we reflect back to the world. The question is,
will we be courageous enough to reveal the glory within? As Marianne Willamson so eloquently put it:
Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond
measure. It is our light, not our darkness that most frightens us. We ask ourselves, Who am I
to be brilliant, gorgeous, talented, fabulous? Actually, who are you not to be? You are a child of
God. Your playing small does not serve the world. There is nothing enlightened about shrinking
so that other people won’t feel insecure around you. We are all meant to shine, as children do.
We were born to make manifest the glory of God that is within us. It’s not just in some of us; it’s
in everyone. And as we let our own light shine, we unconsciously give other people permission to
do the same. As we are liberated from our own fear, our presence automatically liberates others.
16 2009
R E F L E C T I O N S O N M A R C H 1 0 T H
Thir ty-nine years ago, March 10 th became a significant day for me . It wasstrange, because I had overslept for school, and I heard multiple voices in my house -- the voices of aunts, other family members and friends. This was not normal.
My father had recently gone through surgery and radiation treatments. He wasnow a shell of his former self, struggling just to move around the house . This was a result of lung cancer, due to almost 40 years of smoking. Just a fewdays before March 10th, I had observed the local Methodist minister enter our home, which was unusual. Right then and there, in the bathroom of mygrandmother’s house across the street, I knelt down and prayed that Godwould save my father. I wanted God to save him from dying anytime soon.Well , God answered that prayer, but not in the way I had hoped. On March 10, 1971, I awoke to find out that my father had died. The good news is , I believe that my father received Christ ’s forgiveness for his sins, and I ful ly expect to see him again one dayin heaven. So God did answer my first prayer -- He saved my father-- not for a few more years on this ear th, but for all of eterni ty.Every March 10th since 1971 has been a sad reminder for me of a l ife-altering event . But now March 10th has another meaning for me . It is the day I travel to Israel on a mission trip wi thfriends, new and old, and the first day of my Sabbatical. What awonderful oppor tuni ty! I just want to make a difference in thelives of the people that God puts in my life . As the Bible says, I need to decrease so that Jesus can increase (John 3:30). May He be seen and glorified in all that I do.
Ray Thompson, Special Programs AdministratorSABBATICAL: TRIP TO ISRAEL
2009 17
REWARD & REPAIR“Delight yourself in the Lord and he will give you the desires of your heart.” -- Psalms 37:4
They say it takes twenty-one days to learn a new habit, or to unlearn a bad one. In our hectic lives, we are
in the habit of almost always relegating the needs and desires of the heart to the back burner. However, true
reward and repair cannot occur unless we get into the habit of listening to and responding to the needs of
our hearts.
How do we do that? John Eldredge paints a memorable picture for us in Waking the Dead:
I love watching a herd of horses grazing in an open pasture or running free across the sage-
covered plateaus in Montana. I love hiking in the high country when the wildflowers are blooming --
the purple lupine and the Shasta daisies, the Indian paintbrush when it’s turning magenta. I love
thunderclouds, massive ones. My family loves to sit outside on summer nights and watch the
lightning, hear the thunder as a storm rolls in across Colorado. I love water too -- the ocean,
streams, lakes, rivers, waterfalls, rain. I love jumping off high rocks into lakes with my boys.
I love old barns, windmills, the West. I love vineyards. I love it when Stasi is loving something,
love watching her delight. I love my boys. I love God.
Everything you love is what makes a life worth living…A life filled with loving is a life most like
one that God lives, which is life as it was meant to be (Eph. 5:1-2). And loving requires a heart
alive and awake and free.
What a picture of a heart fully alive! And how we have sold ourselves short so many times.
Maybe we have been in the habit of working too much, always driven to succeed and perform. Maybe we
have been in the habit of being short with our spouse or speaking in ways that discourage rather than
encourage. Maybe we have been in the habit of ignoring our inner hurt, pushing it aside and moving on
without taking the time to heal. Maybe we have been in the habit of ignoring the state of our hearts, our
hopes, and our dreams, the things we truly love.
Proverbs 13:12 says, “Hope deferred makes the heart sick; but a longing fulfilled is a tree of life.” Reward and
repair occur only when we make our hearts a priority, rather than an afterthought.
Like anything else, this new habit takes practice. We have to make a choice daily to make our hearts a
priority. What are the things that you truly love? What makes you come alive? Think beyond what gives
you enjoyment. What causes your heart to leap, awaken, and catch hold of a dream?
When we pause and reflect, we will begin to understand the deeper needs of the heart, and reward
and repair are sure to follow. As we allow God’s glory to shine through and we find our delight in him,
he begins to slowly work on repairing the damage that has been done to us.
18 2009
A CHANGE OF PL ANSThe last several days have ranged from stillness and study to total physical activity. Thursday and Friday I continued my study of Waking the Dead, and my spirit is being challenged by what I am reading. The biggest surprise of the Sabbaticalis how being fully rested changes how you feel, how you relate to others, and in general youroverall well-being.
Part of the Sabbatical has changed dramatically since my Dad died less than two months ago. I planned to spend the first week in Lubbock with Mom and Dad and aweek in Durango, Colorado skiing Purgatory Mountain with my lovely wife, Lori.Lori and I had originally planned to spend this time together alone, but decided to include Mom and Marvin, one of my brothers, since Mom has not been able totravel for several years due to Dad’s health.
So, Sunday we loaded up and were on the road by 6:00 am, stopped in at Lubbock to pick up Mom and had a wonderful time enjoying the beautifuldrive and the family time. We arrived at Purgatory Village around 6:00 p.m.Texas time and walked into a beautiful condo that would be serving as our family home for the week. What a view from the windows! Marvin, Lori, andI have skied each day and I love the physical demand. Lori has turned intoa snow bunny and her skiing gets better and better. We love being in themountains and just seeing God’s artistry. It is absolutely, unbelievably amazing seeing the beauty of the work of His hands.Mark Owen, FDLIC Regional Sales Vice PresidentSABBATICAL: LOVE & CARE MINISTRIES
2009 19
RELATIONSHIPS“The eye cannot say to the hand, ‘I don’t need you!’ And the head cannot say to the feet, ‘I don’t need you!’
On the contrary, those parts of the body that seem to be weaker are indispensable…” -- 1 Corinthians 12:21-22
In the great epic, The Lord of the Rings, a band of travelers come together for one purpose: to put an
end to the power of a dark force that threatens to overtake the whole of their land. Though they are each
so different from one another, all of them need each other. They could not have survived, much less
succeeded, without every member of their fellowship playing a vital role.
Yet our tendency is to dismiss the importance of relationships. Wounds may go unforgiven for years.
Pride rises up and keeps us from apologizing. Blame surfaces. Bitter roots grow deep, and fellowship is broken.
John Eldredge reminds us that, like the Fellowship of the Ring, which bands together to fight a war, we, too,
are in the midst of a great epic war of mythic proportions. But we do not war against flesh and blood;
we war against an enemy who would like nothing more than to keep us in bondage, steal our peace, and
destroy our relationships.
You see, relationships are holy ground. God created us to live in community, to encourage one another and
lift each other up, to love one another as his Son loved us. When we break communion with one another,
we break communion with God, and, for the enemy, that battle is won.
Though we may see our relationships as ordinary, they are very special and important to God. One of the
most common themes throughout Jesus’ teachings, Paul’s letters, and the rest of the New Testament is the
importance of loving and forgiving one another. This is because the glory of God is revealed when our love
for one another is made perfect. As John the apostle wrote:
Dear friends, let us love one another, for love comes from God. Everyone who loves has been born
of God and knows God. Whoever does not love does not know God, because God is love. This is
how God showed his love among us: He sent his one and only Son into the world that we might
live through him. This is love: not that we loved God, but that he loved us and sent his Son as an
atoning sacrifice for our sins. Dear friends, since God so loved us, we also ought to love oneanother. No one has ever seen God; but if we love one another, God lives in us and his loveis made complete in us. -- 1 John 4:7-12 (emphasis added)
Our family, friends, co-workers, spiritual community -- all of our relationships -- have a vital role to
play. They grow us, teach us, stretch us, and give us opportunities to reveal God’s glory within us. They are
fertile ground where God’s Kingdom is being spread, and territory is being won back from the enemy.
Our run-of-the-mill relationships may feel like familiar old ground, but they are in fact part of God’s
plan and purpose. Let us not forget when we draw near to another human heart, made in the image of God,
we should take off our shoes and tread with care…for those relationships are holy ground.
20 2009
A WEIGHT LIF TEDI finished the book Captivating by John and Stasi Eldredge this weekend.How wonderful it was! Oh, how it reminded me of the love I had come toforget over time. It puts into perspective how our hearts come first and Godis after our heart how he wants to wholly fill our heart and our life andour desires.
I feel a peace as I am nearing the end of my Sabbatical. First of all I feel very spoiled. I love having the freedom to do other things, to helpothers. I also learned that once this time is up and I am back at worktomorrow I don’t have to give it up either. I have learned what God’slove for me really is and how to embrace it. I learned how tostrengthen relationships I already have. I have learned not to takefor granted these things in life.I have not mentioned much about my family and the relationshipsI wanted to restore. I have been able to do so with some, but others have been resistant. I can't say it is a failure, but I thinkin time God will restore what he wishes to restore. This issomewhat of a soft spot for me and God has been working withme on the resentments I have carried for so long. I have begunto let go of them and feel much better. It is like a weight islifted off of my back. Oh, how wonderful God is!
Kyra Shahan, Directors Choice RepresentativeSABBATICAL: MEALS ON WHEELS
2009 21
REFOCUSMany years before GPS systems were ever invented, navigation on the high seas was anything but an exact
art. When land slipped out of sight, you were navigating based on rough estimates calculated from
the movements of the sun, moon and stars. Knowing where you were (and staying on course at the same
time) was nothing short of a miracle. Take Columbus, for example. To the day he died, he was convinced
his journeys to America from Spain had opened up a new route to the East Indies! He had no idea where
on earth he was.
Many times in life, it feels like we do not know where we’re going or where we’ve been. We’re tossed back
and forth on the sea, adrift without a clue as to how to get back on course. It is time to refocus…and find
a renewed vision and purpose for our lives.
A song by Christian singer Brandon Heath expresses this very need to refocus, to find a new way of
seeing. He sings,
Give me your eyes for just one second.
Give me your eyes so I can see.
Everything that I keep missing,
Give me your love for humanity.
Give me your arms for the broken-hearted,
Ones that are far beyond my reach.
Give me your heart for the ones forgotten,
Give me your eyes so I can see.
Looking through the eyes of love, we can see more clearly what our purpose is and where our destiny lies.
Doing this isn’t easy. It takes time set aside to be able to hear and listen. But just as a helmsman at his post,
we have to stay alert, and diligently plot our course to stay in line with our one true Navigator.
First, our hearts are awakened to the new life that is now possible -- abundant life. This is our final
destination, but what a journey we have ahead of us! As hopeful as Columbus, we set out with high expec-
tations through uncharted waters in search of the new life that awaits.
Taking time for rest, meditation, reflection, and redemption, we hear the voice of the Navigator. He prods
us, go this way, turn here. As it says in Isaiah chapter 30, verse 21, “Whether you turn to the right or to the
left, your ears will hear a voice behind you, saying, ‘This is the way; walk in it.’” We must pause from our
activity to be able to hear that voice.
Well on our journey, we learn to understand the value of reward and repair. It is then that our hearts
are strengthened to steadfastly endure whatever winds or storms may blow our way. We invest in our
relationships and begin to understand what it is to love one another, and we are encouraged and bolstered
on our journey by our friends. And finally, we learn to refocus, to see our journey through the eyes of the
best Navigator in the world, who will never lead us astray. It is from him that we draw our strength and
by his power we are able to see the journey through to the end.
22 2009
THE JOURNEY CONTINUESProverbs 12:20 says “He that trusts in the Lord, happy is he.” How true this verse is. I am learning that more and more every day.It seems to me that the happiest people in the nursing homes are theones that have an abiding faith and trust in Jesus Christ. They arethe most content. They are determined to live each day to the fullestand enjoy whatever time they have left on earth. They are teaching meto live that way also.
Yesterday was the last day of my Sabbatical. It was a time of worship and reflection. Today, I will be back at work with arenewed heart. That has been the result of the last 30 days. God has renewed my heart. I have tried to share with you herewhat He has been doing in my life. It was impossible to shareit all. I do know these things. I will continue to visit in thenursing homes. I have been blessed so very much by the people I have met there. I will continue to be open to the leadership of God in my life. I want my life to be pleasingto Him. I will continue to preach and teach his Wordbecause I know it changes lives. I will do my job each dayas unto the Lord. I will continue to spend quantity andquality time with my family. The Sabbatical may be over,but the journey continues.
Leon Stone, Director of Sales DevelopmentSABBATICAL: NURSING HOME MINISTRY
2009 23
Analysis of Financial PositionFor 2009, the financial position of Funeral Directors Life Insurance Company (FDLIC) remained
strong as the company maintained an A.M. Best Insurance Company Rating of A- (Excellent) during
the year. Operationally, FDLIC significantly out-performed the previous year’s results. Realized capital
losses were down considerably from 2008 and related largely to the results of normal trading activity.
ASSETSThe total assets of FDLIC grew to $632.48 million, an increase of $75.87 million or 13.63% from year-end
2008 to year-end 2009. As of December 31, 2009, FDLIC’s assets were distributed as follows: 97.21% in
investments, 1.24% in investment income due and accrued, .61% in deferred and uncollected life
insurance premiums and annuity considerations, and .94% in various other assets.
Invested Assets: For 2009, the primary investment held by FDLIC was bonds -- government, agency,
and corporate -- representing 85.67% of invested assets or $526.73 million.The emphasis regarding
the investment portfolio has consistently involved maximizing return, limiting risk, achieving
appropriate liquidity, and matching the cash flow of invested assets with the projected cash flow of
the company’s insurance liabilities. Throughout 2009, FDLIC maintained this approach to matching
the expected cash flows. This conservative approach to managing assets has been consistent since 1993
and was designed to reduce risk and
provide assurance that cash flow of assets
is appropriate to provide for the claims of
the company.
The growth in company assets has allowed
FDLIC to “average into the market” over
many different interest rate scenarios,
and in all areas of the yield curve. In
combination with a disciplined approach to
investing, this has enabled FDLIC to lower
the market value volatility of the portfolio to
interest rate fluctuations. During the year, FDLIC increased the diversification of its portfolio by
both asset class and number of issues. Therefore, risk related to individual securities and single asset
sectors has been reduced.
The year was one of significant change and volatility in the financial markets. In March, the equity
markets retreated to new lows. This was followed by a significant appreciation through year-end.
2009 25
The price of standard corporate bonds improved throughout 2009 as credit spreads improved with the
general economy. Unfortunately, many asset classes, including non-agency mortgages, Collateralized
Debt Obligations (CDOs) and Collateralized Loan Obligations (CLOs) continued to decrease during
2009. These securities were impacted by a continued slump in the housing market and the failure
of over 172 banks in the United States. Especially hard hit were Residential Mortgage Backed
Securities (RMBS), as the majority of issues experienced acceleration in Constant Default Rates (CDR)
throughout the year. Historically, FDLIC had a very limited exposure to these types of mortgage
securities; therefore, FDLIC had the flexibility to purchase a few of the higher quality and discounted
issues in 2009 in order to enhance return and improve diversification. At year-end 2009, FDLIC held
32 issues of mortgage securities that were not considered either Government or Agency issue. These
securities represent approximately 5.05% of total Schedule D Part 1 assets. This limited exposure to the
more impacted categories has allowed FDLIC to avoid significant decreases in capital and surplus
resulting from impairments of securities. During the last half of 2009 various swaps were performed
in order to improve the overall portfolio and off-set any losses. In total, more than $2.3 million in net
gains were realized. The majority of these gains will flow through Interest Maintenance Reserve (IMR)
in the next few years in order to enhance capital and surplus.
At year-end 2009, 95.82% of FDLIC’s portfolio of bonds and stocks was investment grade. Out of
535 issues, 37 were rated below SVO2, representing only 3.58% of total assets. As of December 31, 2009,
FDLIC’s allocation of U.S. Government bonds was 17.14% of total bonds; special revenue and
assessment bonds comprised of U.S. Agency and municipal bonds totaled 2.02% and 15.44%,
respectively; and industrial and miscellaneous bonds maintained the greatest allocation at 65.40%
of total bonds.
At year-end 2009, preferred stocks represented 2.56% or $15.75 million of invested assets, down
approximately $13.05 million from 2008. The decrease is the result of disposals and reclassification to
bonds. FDLIC will continue to invest in selective preferred securities only on a limited basis and
consistent with the following parameters: a) dividends must be cumulative, b) the yield must be
greater than or equal to the average sector yield of a thirty-year bond less a deduction of one year’s asset
valuation reserve requirement created by the asset, c) the purchase of preferred stocks below an SVO2
rating will be restricted, and d) the total amount invested in preferred stocks will not exceed 10% of
the total assets of the company.
At year-end 2009, FDLIC’s total common stock portfolio was $8.08 million representing 1.31% of
invested assets and consisted entirely of subsidiary stocks. When market values in the public market
improved dramatically in the third quarter of 2009, FDLIC disposed of its entire publicly traded
stocks. Although capital losses were reflected in the income statement, the overall impact was
26 2009
positive to capital and surplus. Investment in subsidiary stocks improved $601,544 by year-end.
During 2009, FDLIC’s mortgage loan portfolio increased $9.43 million due to the financing of
existing commercial real estate as well as new construction. The mortgage loan portfolio represented
3.86% of invested assets as opposed to 2.62% in 2008. The mortgage loans made and retained by
FDLIC have consistently performed, and as of year-end, the company had no mortgage loans over
90 days past due.
Early in 2007, FDLIC acquired forty-one (41) investment properties totaling approximately $26
million. At year-end 2009, real estate represented 4.59% of invested assets compared to 5.55% in 2008.
During the year there were no acquisitions, only renovations to existing properties including the home
office property. Six properties were disposed of resulting in a gain on the sale. The typical lease
period for these properties is fifteen (15) years.
Cash and short-term investments were $1.89 million consisting largely of exempt money market
funds. This is a significant decrease from year-end 2008 when FDLIC held $5.82 million in cash and
short-term investments. Other invested assets consist of loans to parent that were issued in the first
quarter of 2007 and comprised 1.70% of invested assets. Principal reduction for the year was $373,730.
The portfolio is conservatively positioned to allow for continued improvements during 2010.
The portfolio yield and income are expected to be maintained through 2010 as investments continue
through the current low interest rate cycle and spreads remain tight. There are several agency bonds
purchased at a discount that are expected to be called, allowing FDLIC to realize the difference in cost
and consideration as additional income. No material changes are anticipated for 2010, and FDLIC
will continue to invest for the long-term in assets designed to provide a cash flow sufficient to
cover the anticipated cash flow of the
company’s liabilities. Diversification will
continue in order to reduce exposure to
single portfolio issues and FDLIC will
diligently invest to provide for the historical
investment objectives of the company.
LIABILITIESAt year-end 2009, FDLIC’s liabilities
were distributed as follows: 97.49% in
Aggregate Reserve for Life Contracts, .38%
in Provision for Policyholders’ Dividends
2009 27
and Coupons Payable, .57% in Interest Maintenance Reserve (IMR), .40% in Asset Valuation Reserve (AVR),
.32% in Premiums and Annuity Considerations Received in Advance, and .84% in all other liabilities.
The life insurance and annuity reserves are primarily medium to long term in nature. Life insurance
reserves are calculated on a conservative basis, with 84.20% of the reserves being calculated using
an interest factor of 4% or less. Annuity reserves are equal to the current cash surrender value of
the annuities plus additional reserves required by Actuarial Guideline 33. The terms of the annuity
contracts are conservative, offering interest guarantees of 1% to 5% and no bail out provisions.
The IMR increased $2.23 million or 213.58% from year-end 2008 to year-end 2009 due to net gains
on bond disposals. The AVR increased $764,651 or 50.25% for normal reserving requirements.
Generally, the differences between years in the other liability categories did not result from any
significant changes in liability trends, but were the result of normal business.
CAPITAL AND SURPLUSTotal capital and surplus increased $9.20
million for 2009 as compared to the
minimal increase in 2008. The significant
increase is due to net income of $6.01
million and decreased non-admitted assets
related to recognition of deferred tax assets.
The company maintained a ratio of capital
and surplus to total assets of 9.13% at
year-end 2009. No material favorable or
unfavorable trends existed in FDLIC’s
capital and surplus accounts.
Results of OperationsREVENUEFrom year-end 2007 to year-end 2008, premium income increased by 24.87%, and from year-end
2008 to year-end 2009, premium income increased by 15.66%. New business sales production for 2009
surpassed $154 million and exceeded 2008 by 12.82%. In this decade, there has been a marked shift
toward more single pay, which has also put pressure on profit margins. In 2008 that trend reversed,
with about 3.5% of business shifting to multi-pay, though in 2009 about 1.3% has shifted back to
single pay. These shifts are primarily due to the characteristics of new funeral home clients.
28 2009
Annuity premium income increased 8.75% over 2008 compared to the 31.33% increase from 2007 to 2008.
The significant variance was due to the completion of $13.4 million in trust conversions in 2008 as compared
to $4.9 million during 2009. Ordinary life, group life, and industrial life premium income increased
27.52% between 2008 and 2009. The amount of
ordinary life new business increased due to the
significant increase in direct new business sales
production during the year.
Net investment income increased $3.37 million
or 10.30% from year-end 2008 to year-end 2009.
The $4.59 million increase in investment
income from year-end 2007 to year-end 2008
was the result of a full year of income from real
estate investments and mortgage loans (with
significantly higher rates of return than bonds
and stocks) that occurred in the first and second quarters of 2007. Yields spiked in the fourth quarter
of 2008 and early 2009 and available cash flows were invested at spreads near all time highs, but those
rates were short lived as late 2009 brought lower rates of return and spreads tightened. Net new dollars
invested for 2009 were $71.92 million compared to $53.83 million in 2008.
EXPENSESFor 2009, overall expenses increased $18.43 million or 12.20% compared to $28.14 million or 23.51%,
for 2008. Death benefits increased 10.30%, while annuity benefits increased 14.98% during 2009.
Increase in aggregate reserves from year to year was 12.92% due to the increase in new business sales
during the year. Commissions increased 13.86% for the increase in new business sales as well. General
insurance expenses increased $957,361 or 7.80% for 2009 largely for additional sales and administrative
personnel and enhancement of sales-related programs. This increase is down from $1.38 million
in 2008, as FDLIC diligently strives to control expenses. No other material expense changes occurred
during 2009.
NET INCOMEFor 2009, net income was $6.01 million or 484.89% higher than net income recorded in
2008. The following facts are relevant when reviewing the difference in net income between
2008 and 2009: 1) 2009 net gain from operations exceeded 2008 by $3.059 million or 74.58%
for significant increases in revenue, 2) FDLIC realized net capital losses of $1.15 million in 2009
compared to net capital losses of $3.07 million in 2008. While losses incurred during 2009 were
2009 29
largely related to the sale of publicly traded
common and preferred stocks, losses in 2008
were entirely related to other than temporary
impairments recorded for holdings in Lehman
Brothers and Washington Mutual.
CASH FLOWAND LIQUIDITYThrough the consistency of premium income
and the growth of investment income, FDLIC
has continued to maintain extremely positive
cash flow. Premium and investment income have allowed FDLIC to meet all obligations and invest a
considerable amount of the remainder. This trend is expected to continue for 2010 and beyond.
However, FDLIC has made appropriate plans for the future by continuing the investment strategy of
matching asset maturities with liability cash flow projections.
Despite the significant turmoil in the fixed income markets, 2009 represented advantageous
opportunities on which FDLIC was able to capitalize. Moreover, the diversification and structure
of the portfolio has afforded FDLIC the opportunity to benefit from the current economic crisis.
For example, FDLIC experienced only limited write-downs due to the conservative nature of the
portfolio. New cash flows during the first part of 2009 were reinvested at higher spreads; however, cash
flows towards the end of 2009 were reinvested at tighter spreads as the markets improved. Together, these
investments help maintain the portfolio book yield despite the low level of interest rates. The book yield
did decrease slightly during 2009, but it remains above the year-end 2007 levels. The portfolio remains
diversified and in a positive position to move forward in 2010 and the years to come.
FDLIC has maintained considerable liquidity over the years and will continue to do so in the future.
As stated above, current cash flow has always been sufficient to meet maturing insurance and
annuity obligations, as well as operating expenses; however, if FDLIC is required, by some
catastrophic event, to generate cash flow, it may do so by liquidating its marketable securities.
CONCLUSIONFDLIC has experienced steady and consistent growth over the last five years as evidenced by the
Five-Year Summary with selected financial and statistical data (pg. 31). For 2010, FDLIC will continue
its expansion into states outside of Texas, which now provide approximately 65% of the company’s
new business production. As discussed above, FDLIC will continue to invest in accordance with its long-
standing investment philosophy and fully expects to maintain its portfolio book yield and income.
30 2009
SELECTED FINANCIAL AND STATISTICAL DATA
Year Ended December 312009 2008 2007 2006 2005
New Business Issued $ 154,665.1 $137,090.9 $105,204.7 $86,429.6 $81,997.3Premium Income 143,524.5 124,088.1 99,373.4 84,707.5 83,585.2 Life Insurance in Force 422,570.0 377,177.0 342,147.0 315,542.0 296,962.0 Aggregate Life Reserves 560,303.9 497,636.2 442,143.5 400,461.9 366,608.2 Capital & Surplus 57,765.5 48,560.9 48,511.1 45,428.8 41,453.7 Net Income Before Capital Gains 7,160.1 4,101.2 3,091.7 3,332.3 3,872.3 Total Assets 632,476.7 556,605.8 500,388.9 453,382.6 416,296.8 Net Investment Income 36,118.5 32,744.6 28,151.8 25,092.4 23,351.2 A. M. Best Rating A- A- A- A- B++Ratio of Capital & 9.13% 8.72% 9.69% 10.02% 9.96%
Surplus to Total Assets
INVESTED ASSET MIXBonds 85.7% 81.6% 81.6% 83.6% 91.5%Stocks 3.9% 7.1% 8.1% 6.0% 5.4%Mortgage Loans on Real Estate 3.8% 2.6% 1.3% 1.1% 0.5%Real Estate 4.6% 5.5% 6.3% 1.3% 1.4%Cash or Short-term Investments 0.3% 1.1% 0.4% 8.0% 0.5% Other Invested Assets 1.7% 2.0% 2.3% 0.0% 0.8%
IN THOUSANDS
F I V E - Y E A R S U M M A R Y
OPERATIONSRevenues $180,382.7 $157,257.0 14.71%Net Earnings 6,007.2 1,027.1 484.89%
FINANCIALTotal Assets 632,476.7 556,605.8 13.63%Reserves 560,652.9 498,397.2 12.49%Shareholder’s Equity 57,765.5 48,560.9 18.95%
EMPLOYEES 106 90 17.78%
POLICYHOLDERS 176,030 159,681 10.24%
IN THOUSANDS
Year Ended December 312009 2008 % Change
F I N A N C I A L H I G H L I G H T S
2009 31
IN THOUSANDS
Year Ended December 312009 2008
ASSETSBonds $526,728.9 $443,044.6 Stocks-Preferred 15,753.7 28,803.0 Stocks-Public - 2,534.1 Stocks-Subsidiaries 8,075.9 7,474.4 Mortgage Loans 23,647.2 14,215.1 Real Estate 28,206.4 30,126.3 Policy Loans 63.4 51.9 Cash and Short-Term Investments 1,889.3 5,819.2 Other Invested Assets 10,464.3 10,838.0
Total Invested Assets 614,829.1 542,906.6 Furniture and Equipment 1,597.1 1,305.7 Deferred Premiums 3,859.2 3,447.7 Accrued Investment Income 7,855.1 6,993.9 Deferred Tax Asset 3,872.2 1,260.8 Other Assets 464.0 691.1
Total Assets $632,476.7 $556,605.8
LIABILITIES Policy Reserves $560,652.9 $498,397.2 Policy Claims 834.0 797.0 Provision for Policyholder Dividends 2,200.0 2,300.0 Premiums Received in Advance 1,835.0 1,527.5 Interest Maintenance Reserve 3,273.8 1,044.0 Accrued Commissions 1,525.2 69.3 Accounts Payable 140.4 110.1 Other Liabilities 1,963.5 2,278.0 Asset Valuation Reserve 2,286.4 1,521.8
Total Liabilities 574,711.2 508,044.9
SHAREHOLDER’S EQUITYCommon Stock 2,500.0 2,500.0 Additional Paid-In Capital 1,531.0 1,531.0 Surplus 53,734.5 44,529.9
Total Shareholder’s Equity 57,765.5 48,560.9 Total Liabilities and Shareholder’s Equity $632,476.7 $556,605.8
B A L A N C E S H E E T
32 2009
IN THOUSANDS
Year Ended December 312009 2008
REVENUELife Premiums and Annuity Payments $143,524.5 $124,088.1 Net Investment Income 36,118.5 32,744.6 Other Income 739.7 424.3
Total Revenue 180,382.7 157,257.0
BENEFITS & EXPENSESDeath and Annuity Benefits 70,589.5 62,100.0 Other Benefits 1,709.1 1,575.9 Increase in Aggregate Reserves 62,667.7 55,492.6 Operating Expenses and Commissions 31,661.2 28,655.8 Dividends to Policyholders 2,829.2 3,202.1
Total Benefits and Expenses 169,456.7 151,026.5 Income Before Capital Losses & Taxes 10,926.0 6,230.5 Capital Losses (Net of Income Taxes) (1,152.9) (3,074.1) Income Before Income Taxes 9,773.1 3,156.4 Less Provision for Income Taxes 3,765.9 2,129.3
NET INCOME $6,007.2 $1,027.1
S U M M A R Y O F O P E R A T I O N S
2009 33
Year Ended December 312009 2008
CASH FLOW FROM OPERATING ACTIVITIESPremiums and Annuity Payments $143,228.7 $123,707.7 Investment Income Received 35,037.9 31,535.3 Other Income Received 238.9 182.4 Benefits and Loss Related Payments (72,669.1) (63,496.9)Operating Expenses Paid (31,067.0) (28,237.2)Policyholder Dividends Paid (2,931.6) (3,104.1)Income Taxes Paid (3,594.9) (2,414.7)
Net Cash Provided by Operating Activities 68,242.9 58,172.3
CASH FLOW FROM INVESTING ACTIVITIES Proceeds From Investments Sold 189,380.5 118,175.8 Other Cash Provided 594.0 375.7 Acquisition of Investments:
Bonds (246,429.0) (158,698.4)Stocks (3,427.7) (5,409.2)Mortgage Loans (11,080.0) (8,276.3)Real Estate (1,210.6) (594.9)Net Cash Used in Investing Activities (72,172.8) (54,427.3)
NET INCREASE (DECREASE) IN CASH ANDSHORT-TERM INVESTMENTS (3,929.9) 3,745.0
CASH AND SHORT-TERM INVESTMENTSBeginning of Year 5,819.2 2,074.2
End of Year $1,889.3 $5,819.2
IN THOUSANDS
S T A T E M E N T O F C A S H F L O W
Year Ended December 312009 2008
CAPITAL & SURPLUSShareholder’s Equity Balance $48,560.9 $48,511.1 Net Income 6,007.2 1,027.1 Unrealized Gain (Loss) on Investments 778.9 (1,031.8) Change in Deferred Tax 5.3 261.5 Change in Non-Admitted Assets 3,177.9 (904.9)Change in Asset Valuation Reserve (764.7) 697.9Shareholder’s Equity Balance $57,765.5 $48,560.9
IN THOUSANDS
S T A T E M E N T O F S H A R E H O L D E R ’ S E Q U I T Y
34 2009
DIRECTORS INVESTMENT GROUPB o a r d o f D i r e c t o r s
Allan Adams b Ralls, TX
Mike Branon b Lamesa, TX
Jack Cypert b Snyder, TX
Jerry Edwards b Palo Pinto, TX
Mark France b Austin, TX
Robert Hamil b Abilene, TX
Billy Ray Harper b San Angelo, TX
Jeff Harper b San Angelo, TX
Jay Kelly b Odessa, TX
Mike Lemons b Austin, TX
Carl C. Peterson b Abilene, TX
Darrell Rains b Austin, TX
Kris Seale b Abilene, TX
Ernest Welch b Big Spring, TX
Tommy Welch b Big Spring, TX
Bob White b Weatherford, TX
FUNERAL DIRECTORS LIFEINSURANCE COMPANY
E x e c u t i v e O f f i c e r sKris Seale
President & Chief Executive Officer
Pat BaxterExecutive Vice President & Chief Operations Officer
Mark FranceExecutive Vice President & Chief Actuary
Terry GrobanExecutive Vice President & Chief Financial Officer,
Secretary, Treasurer
Dawson RodriguezExecutive Vice President & Chief Information Officer
Todd CarlsonVice President of Sales
Paul LovelaceVice President of Corporate Development
Jeff StewartVice President of Marketing & Chief Marketing Officer
Billy Ray HarperChairman of the Board
6 5 5 0 D i r e c t o r s P a r k w a yP. O. D r a w e r 5 6 4 9A b i l e n e , T X 7 9 6 0 81 . 8 0 0 . 6 9 2 . 9 5 1 5w w w. f u n e r a l d i r e c t o r s l i f e . c o m
I t e m # 2 0 0
