<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1999 Commission File Number: 2-35669
SOUTHERN SECURITY LIFE INSURANCE COMPANY
------------------------------------------
Exact Name of Registrant.
FLORIDA 59-1231733
- ---------------------------- ----------------------
(State or other jurisdiction IRS Identification Number
of incorporation or organization)
755 Rinehart Road, Lake Mary, Florida 32746
- -------------------------------------- -----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including Area Code (407) 321-7113
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES XX NO
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
Class A Common Stock, $1.00 par value 1,907,989
- ------------------------------------- ------------------
Title of Class Number of Shares outstanding
as of June 30, 1999
<PAGE>
<TABLE>
<CAPTION>
SOUTHERN SECURITY LIFE INSURANCE COMPANY
FORM 10Q
QUARTER ENDED JUNE 30, 1999
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
<S> <C>
Item 1 Financial Statements Page No.
Statements of Income - Six and Three Months
ended June 30, 1999 and 1998 . . . . . . . . . . . . .3
Balance Sheets - June 30, 1999
and December 31, 1998. . . . . . . . . . . . . . . .4-5
Statements of Cash Flows -
Six months ended June 30, 1999 and 1998. . . . . . . .6
Notes to Condensed Financial Statements. . . . . . .7-8
Item 2 Management's Discussion and Analysis. . . . . 8-12
Item 3 Quantitative and Qualitative Disclosure
of Market Risk. . . . . . . . . . . . . . . . . 12
PART II - OTHER INFORMATION
Other Information. . . . . . . . . . . . . . . . .13-14
Signature Page . . . . . . . . . . . . . . . . . . . 15
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
SOUTHERN SECURITY LIFE INSURANCE COMPANY
Statements of Income
(Unaudited)
Six Months Ended June 30, Three Months Ended June 30,
1999 1998 1999 1998
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
------------ ------------ ---------- -----------
Revenues:
- ---------
<S> <C> <C> <C> <C>
Net insurance
revenues $3,176,270 $3,880,958 $ 1,425,230 $ 2,117,531
Net investment
income 1,728,002 1,867,987 947,004 934,259
Net investment
income with
related parties 395,636 -- 272,077 --
Realized gain on
investments -- 414,184 -- 81,901
Other 721,904 -- 721,904 --
---------- ----------- ----------- -----------
Total revenues 6,021,812 6,163,129 3,366,215 3,133,691
Benefits, losses and expenses:
- -----------------------------
Annuity, death,
surrender and
other policy
benefits 2,630,383 2,317,699 1,497,593 1,231,297
Increase in
future policy
benefits 138,506 226,953 11,402 98,098
Amortization of
deferred policy
acquisition
costs 1,474,406 1,726,723 645,738 799,512
Operating
expenses 1,479,057 1,825,162 851,971 1,039,077
Interest expense
with related
party 45,000 45,000 22,500 22,500
Total benefits
and expenses 5,767,352 6,141,537 3,029,204 3,190,484
Income (loss)
before income
taxes 254,460 21,592 337,011 (56,793)
Income tax
expense (benefit) 98,476 7,049 106,124 (22,345)
Net income
(loss) $ 155,984 $ 14,543 $ 230,887 $ (34,448)
Basic net income
(loss) per
share of common
stock $.08 $.01 $.12 $(.02)
Diluted net
income (loss) per
share of common
stock $.08 $.01 $.12 $(.02)
</TABLE>
See accompanying notes to condensed financial statements.
<PAGE>
<TABLE>
<CAPTION>
SOUTHERN SECURITY LIFE INSURANCE COMPANY
BALANCE SHEETS
June 30, 1999 December 31,
(Unaudited) 1998
Assets: ------------- ------------
- -------
<S> <C> <C>
Investments:
Fixed maturities held-to
maturity at amortized cost $ 4,868,764 $ 4,956,910
Securities available for sale,
at fair value:
Fixed maturities 26,221,053 28,479,161
Equity securities 273,971 250,232
Equity securities
of related party 339,830 --
Policy and student loans 8,286,944 8,462,438
Short-term investments 7,650,478 11,434,983
Short-term investments
with related party 1,468,217 --
------------ -----------
Total investments 49,109,257 53,583,724
Cash and cash equivalents 3,710,010 682,389
Accrued investment income 613,153 564,118
Deferred policy acquisition costs 13,122,469 13,583,956
Policyholders' account balances on
deposit with reinsurer 8,340,973 8,518,571
Reinsurance receivable 413,836 306,258
Receivables:
Agent balances 1,392,534 994,493
Other 53,678 351,478
Refundable income taxes 34,951 34,951
Property and equipment,
net, at cost 2,505,334 2,585,255
------------ ----------
Total assets $79,296,195 $81,205,193
</TABLE>
See accompanying notes to condensed financial statements.
<PAGE>
<TABLE>
<CAPTION>
SOUTHERN SECURITY LIFE INSURANCE COMPANY
BALANCE SHEETS (Continued)
June 30, 1999 December 31,
(Unaudited) 1998
Liabilities and Shareholders' Equity: --------------- -------------
- ------------------------------------
<S> <C> <C>
Liabilities:
Policy liabilities and accruals $ 1,865,806 $ 1,727,300
Future policy benefits:
Policyholders' account balances 51,400,879 52,520,300
Unearned revenue 5,480,768 6,023,399
Other policy claims and benefits payable 835,632 540,789
Other Policyholders' funds, dividend
and endowment accumulations 67,044 64,738
Funds held related to reinsurance treaties 1,415,545 1,419,357
Note payable to related party 1,000,000 1,000,000
Due to affiliated insurance agency 131,282 22,871
General expenses accrued 596,448 747,148
Unearned investment income 331,433 340,622
Other liabilities 85,713 90,489
Deferred income taxes 705,284 796,074
------------ -----------
Total liabilities 63,915,834 65,293,087
Shareholders' Equity:
Common stock, $1 par, authorized
3,000,000 shares; issued and outstanding
1,907,989 shares 1,907,989 1,907,989
Capital in excess of par 4,011,519 4,011,519
Accumulated other comprehensive
income (loss) (257,568) 430,161
Retained earnings 9,718,421 9,562,437
------------ -----------
Total common stock 15,380,361 15,912,106
------------ -----------
Total liabilities and
stockholders' equity $79,296,195 $81,205,193
</TABLE>
See accompanying notes to condensed financial statements.
<PAGE>
<TABLE>
<CAPTION>
SOUTHERN SECURITY LIFE INSURANCE COMPANY
STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended June 30,
1999 1998
<S> <C> <C>
Net cash provided by operating activities $ 158,461 $ 1,831,961
Cash flows provided by (used in)
investing activities:
Purchase of investments available
for sale (equity and fixed maturity) (339,830) (6,782,600)
Proceeds from maturity of held to
maturity securities 82,961 4,042,975
Proceeds from maturity of available
for sale securities 1,171,236 299,281
Proceeds from sale of available for
sale securities (equity and
fixed maturity) -- 6,779,007
Net change in short-term
investments 2,316,288 --
Net change in policy and
student loans 171,682 (141,997)
Acquisition of property
and equipment -- (45,445)
Net cash provided by
investing activities 3,402,337 4,151,221
Cash flows provided by (used in) financing activities:
- -----------------------------------------------------
Receipts from universal
life and certain annuity
policies credited to
policyholder account balances 3,283,542 1,716,589
Return of policyholder
account balances on
universal life and
certain annuity policies (3,816,719) (2,333,598)
Net cash used in financing activities (533,177) (617,009)
Increase in cash and cash equivalents 3,027,621 5,366,173
Cash and cash equivalents at beginning
of period 682,389 2,448,994
Cash and cash equivalents at
end of period $ 3,710,010 $ 7,815,167
See accompanying notes to condensed financial statements.
</TABLE>
SOUTHERN SECURITY LIFE INSURANCE COMPANY
Notes to Condensed Financial Statements
June 30, 1999
(Unaudited)
1. Basis of Presentation
The accompanying unaudited condensed financial statements have been
prepared by management in conformity with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Regulation S-X. Accordingly, they do
not include all of the disclosures required by generally accepted
accounting principles for complete financial statements. All
adjustments and accruals considered necessary for fair presentation
of financial information have been included in the opinion of
management, and are of a normal recurring nature. Quarterly results
of operations are not necessarily indicative of annual results.
These statements should be read in conjunction with the financial
statements and the notes thereto included in the Southern Security
Life Insurance Company 1998 Annual Report on Form 10-K for the
fiscal year ended December 31, 1998 (file number 2-35669).
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from
those estimates.
The estimates susceptible to significant change are those used in
determining the liability for future policy benefits and claims.
Although some variability is inherent in these estimates, management
believes the amounts provided are adequate.
2. Comprehensive Income
For the three months ended June 30, 1999 and 1998, total
comprehensive income (loss) was $(201,923) and $(36,744),
respectively.
For the six months ended June 30, 1999 and 1998, total comprehensive
income (loss) was $(531,745) and $19,743, respectively.
3. Management Fees
Effective December 17, 1998, the Company entered into an
Administrative Services Agreement with Security National Financial
Corporation ("SNFC"). Under the terms of the agreement, SNFC has
agreed to provide the Company with certain defined administrative
and financial services, including accounting services, financial
reports and statements, actuarial, policyholder services,
underwriting, data processing, legal, building management, marketing
advisory services and investment services. In consideration for the
services to be provided by SNFC, the Company shall pay SNFC an
administrative services fee of $250,000 per month, provided,
however, that such fee shall be reduced to zero for so long as the
capital and surplus of the Company is less than or equal to
$6,000,000 unless the Company and SNFC otherwise agree in writing
and such agreement is approved by the Florida Department of
Insurance.
The administrative services fee may be increased, beginning on
January 1, 2001, to reflect increases in the Consumer Price Index,
over the index amount as of January 1, 2000. The Administrative
Services Agreement shall remain in effect for an initial term
expiring on December 16, 2003. The term of the agreement may be
automatically extended for additional one-year terms unless either
the Company or SNFC shall deliver a written notice on or before
September 30 of any year stating to the other its desire not to
extend the term of the Agreement. However, in no event can the
Agreement be terminated prior to December 16, 2003. It is
anticipated that the Company will realize a reduced level of general
and administrative costs in the future as a result of the
Administrative Services Agreement.
<PAGE>
Item 2. Management's Discussion and Analysis
------------------------------------
Overview
This analysis of the results of operations and financial condition
of Southern Security Life should be read in conjunction with the
Condensed Financial Statements and Notes to the Condensed Financial
Statements included in this report.
In recent years, the Company has primarily issued two types of
insurance products: universal life and final expense products.
Universal life provides insurance coverage with flexible premiums,
within limits, which allow policyholders to accumulate cash values.
The accumulated cash values are credited with tax-deferred interest,
as adjusted by the Company on a periodic basis. Deducted from the
cash accumulations are administrative charges and mortality costs.
Should a policy surrender in its early years, the Company assesses
a surrender fee against the cash value accumulations based on a
graded formula.
Final expense products are traditional endowment type insurance
policies written for the senior market. Because the products are
written to a senior market they are designed to accommodate adverse
health conditions. Because of the size of the policies, the
products are usually issued with only limited underwriting. The
coverage size of the policy is roughly equivalent to the insured's
anticipated funeral costs.
An additional source of income to the Company is investment revenue.
The Company invests those funds deposited by policyholders of
universal life and annuity products in debt and equity securities in
order to earn interest and dividend income, a portion of which is
credited back to the policyholders. Interest rates and maturities
of the Company's investment portfolio play an important part in
determining the interest rates credited to policyholders.
Product profitability is affected by several different factors, such
as mortality experience (actual versus expected), interest rate
spreads (excess interest earned over interest credited to
policyholders) and controlling policy acquisition costs and other
costs of operation. The results of any one reporting period may be
significantly affected by the level of death claims or other
policyholder benefits incurred due to the Company's relatively small
size.
Results of Operations
Six Months Ended June 30, 1999 Compared to Six Months Ended June 30, 1998.
- --------------------------------------------------------------------------
Total revenues decreased by $141,000, or 2.3%, to $6,022,000 for the
six months ended June 30, 1999, from $6,163,000 for the six months
ended June 30, 1998. Contributing to this reduction in total
revenues was a $705,000 decrease in net insurance revenues and a
$414,000 decrease in realized gain on investments. In addition
there was a $256,000 increase in net investment income and a
$722,000 increase in other revenues.
<PAGE>
Net insurance revenues decreased by
$705,000, or 18.2%, to $3,176,000 for the six months ended June 30, 1999,
from $3,881,000 for the six months ended June 30, 1998. This decrease was
primarily the result of a change in the sales mix of the Company's insurance
products. Since March 1998, the sales of the Company's funeral plan
products have been greater than the universal life products. The
universal life products are for greater face amounts than the
funeral plan products. Consequently, the insurance revenues from
final expense products are less than those from universal life
products.
The Company's decision in 1998 to reduce its mutual fund holdings
resulted in $414,000 in realized gains on investments for the six
months ended June 30, 1998 as compared to no realized gains on
investments for the same period in 1999.
Net investment income increased by $256,000, or 13.7%, to $2,124,000
for the six months ended June 30, 1999, from $1,868,000 for the six
months ended June 30, 1998. Part of this increase (approximately
$110,000) was due to rent collected for the Company's office space
which is now paid by an affiliated company (see the management fee
discussed in the Notes to the Condensed Financial Statements)
whereas in the prior year the rent was an intercompany charge which
was eliminated in the financial statements. The balance of the
increase (approximately $146,000) was due to the Company investing
in mortgage loans provided by an affiliated company which are
warehoused until the loans are sold to a third party investor.
Other revenues totaled $722,000 for the six months ended June 30,
1999 as compared to none for the same period in 1998. This amount
was the result of a settlement from insurance claims filed for the
recovery of the costs to litigate a case against a former officer of
the Company.
Annuity, death, surrender, and other policy benefits and increase in
future policy benefits increased by $224,000, or 8.8%, to $2,769,000
for the six months ended June 30, 1999, from $2,545,000 for the
comparable period in 1998. The increase was primarily due to
increased interest credited for policyholder funds and greater death
claims.
The amortization of deferred policy acquisition costs decreased by
$252,000, or 14.6%, to $1,474,000, for the six months ended June 30,
1999, from $1,727,000 for the comparable period in 1998. The
decrease in amortization expenses was primarily due to the change in
net insurance revenues.
Operating expenses decreased by $346,000, or 19.0% to $1,479,000 for
the six months ended June 30, 1999 from $1,825,000 for the same
period in 1998. This reduction was primarily due to the change in
insurance revenues, which resulted in lower commission expense and
premium taxes. In addition, on December 17, 1998, the Company
entered into an Administrative Services Agreement with Security
National Financial Corporation, an affiliated company, to provide
administrative services for a fixed fee. See Notes to Condensed
Financial Statements.
Second Quarter of 1999 Compared to Second Quarter of 1998
- ---------------------------------------------------------
Total revenues increased by $232,000, or 7.4%, to $3,366,000 for the
three months ended June 30, 1999, from $3,134,000 for the three
months ended June 30, 1998. Contributing to this increase was a
$722,000 increase in other revenues, and a $285,000 increase in net
investment income. In addition there was a $693,000 decrease in net
insurance revenues and an $82,000 decrease in realized gain on
investments.
<PAGE>
Net insurance revenues decreased $693,000 or 32.7%, to $1,425,000
for the three months ended June 30, 1999, from $2,118,000 for the
three months ended June 30, 1998. This decrease is primarily the
result of a change in the sales mix of the Company's insurance
products. Since March 1998, the sales of the Company's funeral plan
products have been greater than the universal life products. The
universal life products are for greater face amounts than the
funeral plan products. Consequently, the insurance revenues from
the final expense products are less than those from universal life
products.
The Company's decision in 1998 to reduce its mutual fund holdings
resulted in $82,000 in realized gains on investments for the three
months ended June 30, 1998 as compared to no realized gains on
investments for the same period in 1999.
Net investment income increased by $285,000, or 30.5%, to $1,219,000
for the three months ended June 30, 1999, from $934,000 for the
three months ended June 30, 1998. Part of this increase
(approximately $110,000) was due to rent collected for the Company's
office space which is now paid by an affiliated company (see the
management fee discussed in the Notes to the Condensed Financial
Statements), whereas in the prior year the rent was an intercompany
charge and eliminated in the financial statements. The balance of
the increase (approximately $175,000) was due to investing in
mortgage loans provided by an affiliated company which are
warehoused until the loans are sold to a third party investor.
Other revenues totaled $722,000 for the three months ended June 30,
1999 as compared to none for the same period in 1998. This amount
was the result of a settlement from insurance claims filed for the
recovery of the costs to litigate a case against a former officer of
the Company.
Annuity, death, surrender, and other policy benefits and increase in
future policy benefits increased by $180,000, or 13.5%, to
$1,509,000 for the three months ended June 30, 1999, from $1,329,000
for the comparable period in 1998. The increase was primarily due to
increased interest credited for policyholder funds and greater death
claims.
The amortization of deferred policy acquisition costs decreased by
$154,000, or 19.2%, to $646,000, for the three months ended June 30,
1999, from $800,000 for the comparable period in 1998. The decrease
in amortization expenses was primarily due to the change in net
insurance revenues.
Operating expenses decreased by $187,000, or 18.0%, to $852,000 for
the three months ended June 30, 1999 from $1,039,000 for the same
period in 1998. The decrease was primarily due to the change in
insurance revenues, which resulted in lower commission expense and
premium taxes. In addition, on December 17, 1998, the Company
entered into an Administrative Services Agreement with Security
National Financial Corporation, an affiliated company, to provide
administrative services for a fixed fee. See Notes to Condensed
Financial Statements.
Liquidity and Capital Resources
The Company attempts to match the duration of invested assets with
its policyholder liabilities. The Company may sell investments other
than those held-to-maturity in the portfolio to help in this timing;
however, to date, that has not been necessary. The Company
purchases short-term investments on a temporary basis to meet the
<PAGE>
expectations of short-term requirements of the Company's products.
The Company's investment philosophy is intended to provide a rate of
return which will persist during the expected duration of
policyholder liabilities regardless of future interest rate
movements.
The Company's investment policy is to invest predominantly in fixed
maturity securities, mortgage loans, and warehouse mortgage loans on
a short-term basis before selling the loans to investors in
accordance with the requirements and laws governing life insurance
companies. Bonds owned by the Company amounted to $31,090,000 as of
June 30, 1999 as compared to $33,436,000 as of December 31, 1998.
This represents 63.3% and 62.4% of the total investments as of June
30, 1999 and December 31, 1998, respectively. Generally, all bonds
owned by the Company are rated by the National Association of
Insurance Commissioners. Under this rating system, there are six
categories used for rating bonds. At June 30, 1999, and at
December 31, 1998,the Company did not have investments in bonds in
rating categories three through six, which are considered
non-investment grade.
The Company has classified certain of its fixed income securities as
available for sale, with the remainder classified as held to
maturity. However, in accordance with Company policy, any such
securities purchased in the future will be classified as held to
maturity. Business conditions, however, may develop in the future
which may indicate a need for a higher level of liquidity in the
investment portfolio. In that event the Company believes it could
sell short-term investment grade securities before liquidating
higher-yielding longer term securities.
The Company is subject to risk based capital guidelines established
by statutory regulators requiring minimum capital levels based on
the perceived risk of assets, liabilities, disintermediation, and
business risk. At June 30, 1999 and December 31, 1998, the Company
exceeded the regulatory criteria.
Lapse rates measure the amount of insurance terminated during a
particular period. The Company's lapse rate for life insurance in
1998 was 17.4% as compared to a rate of 20.0% for 1997. The 1999
lapse rate is approximately the same as 1998.
At June 30, 1999, $8,608,000 of the Company's consolidated
stockholders' equity represented the statutory stockholders' equity.
The Company cannot pay a dividend to its parent company without the
approval of insurance regulatory authorities.
The Company has no material commitments for capital expenditures.
Year 2000 Issues
- ----------------
The Company is currently completing its efforts to resolve the
potential impact of the Year 2000 on the processing of information by
the Company's insurance systems. The Year 2000 problem is the result
of computer programs being written using two digits (rather than
four) to define the applicable year. Any of the Company's systems
that have time-sensitive software may recognize a date using "00" as
the year 1900 rather than 2000, which could result in miscalculations
or system failures. The Company has substantially completed the
necessary system upgrades and compliance testing and expects the
system to be entirely complete by September 30, 1999.
The Company's most significant operational system is currently being
replaced through conversion pursuant to an Administrative Services
Agreement. Under the Administrative Services Agreement entered into
by the Company effective December 17, 1998, Security National made
<PAGE>
available a new LifePro Administrative system. LifePro is a
subsidiary of IBM. Since May of 1998, SNFC has invested in excess of
$1.0 million to implement a system conversion for the Company. For
further discussion on the Administrative Services Agreement, see the
Notes to Condensed Financial Statements.
The anticipated future costs of addressing potential Year 2000
problems are not currently expected to have a material adverse impact
on the Company's financial position, results of operations or cash
flows in future periods. However, if the Company, its customers or
vendors are unable to resolve such processing issues in a timely
manner, it could result in a material financial risk. Management
believes that manual policy and claims administration could be
performed in the unlikely event that one or more of its systems did
not function. The Company plans to devote the necessary resources to
test and remediate all remaining Year 2000 issues in a timely manner.
The cost that has been incurred and paid in achieving Year 2000
compliance is approximately $1.0 million as discussed above. As of
June 30, 1999, management does not anticipate any other significant
costs to be incurred associated with its Year 2000 initiatives.
Item 3. Quantitative and Qualitative Disclosure of Market Risk
There have been no significant changes since the annual report Form
10-K filed for the year ended December 31, 1998.
<PAGE>
Part II Other Information:
Item 1. Legal Proceedings
The Company has been named as a party in connection with
two actions pending in the Circuit Court of Loundes
County, Alabama by Willie May Oliver and Eugene Oliver,
Jr., in the first action and Eva Mae Howard in the second
action. The complaints filed in these actions against the
Company and certain insurance agents assert claims for
fraud, misrepresentation, and negligent hiring, training
and supervision by the Company and seek compensatory and
punitive damages, interest and costs. The Company
believes that there is no basis to the claims in the
complaints and intends to vigorously defend against these
actions. The Company has had settlement discussions with
the Olivers and Ms. Howard and has reached a tentative
settlement with these individuals which would, when
completed, result in the dismissal of the complaints
against the Company with prejudice. The proposed
settlement would not have a material adverse effect on the
Company nor its business.
The Company is not a party to any other legal proceedings
outside the ordinary course the Company's business or to
any other legal proceedings which, if adversely
determined, would have a material adverse effect on the
Company or its business.
Item 2. Changes in Securities
NONE
Item 3. Defaults Upon Senior Securities
NONE
Item 4. Submission of Matters to a Vote of Security Holders
NONE
Item 5. Other Information
NONE
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
3. A. Articles of Incorporation, as amended, and By-laws, as
amended (without exhibits), dated September 1994,
incorporated by reference herein from Exhibit 3(1) of the
Annual Report of the Company filed on Form 10-K for the
fiscal year ended December 31, 1994.
10. A. Executive Compensation Agreement between the Company and
George Pihakis (without exhibits) incorporated by
reference herein from Exhibit 10(B) of the Annual Report
of the Company filed on Form 10-K for the fiscal year
ended December 31, 1984.
B. Revolving Financing Agreement between the Company and the
Student Loan Marketing Association, dated as of September
19, 1996, incorporated by reference herein from Exhibit
10(A) of the Annual Report of the Company filed on Form
10-K for the fiscal year ended December 31, 1996.
<PAGE>
C. Reinsurance Agreement between the Company and United
Group Insurance Company, dated as of December 31, 1992
incorporated by reference herein from Exhibit 10(B) of
the Annual Report of the Company filed on Form 10-K for
the fiscal year ended December 31, 1992.
D. Agency Agreement between the Company and Insuradyne
Corporation incorporated by reference herein from Exhibit
10(C) of the Annual Report of the Company filed on Form
10-K for the fiscal year ended December 31, 1993.
E. Administrative Services Agreement between the Company and
Security National Financial Corporation effective
December 17, 1998, incorporated by reference herein from
Exhibit 10(E) of the Annual Report of the Company filed
on Form 10-K for the fiscal year ending December 31,
1998.
27. Financial Data Schedule
(b) Reports on Form 8-K:
NONE
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
REGISTRANT
SOUTHERN SECURITY LIFE INSURANCE COMPANY
Registrant
DATED: August 18, 1999 By: George R. Quist,
--------------- -------------------
President and Chief
Executive Officer
(Principal Executive
Officer)
DATED: August 18, 1999 By: Scott M. Quist
--------------- ------------------
First Vice President,
General Counsel and
Treasurer (Principal
Financial and Accounting
Officer)
<TABLE> <S> <C>
<ARTICLE> 7
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1999
<DEBT-HELD-FOR-SALE> 26,221,053
<DEBT-CARRYING-VALUE> 27,235,274
<DEBT-MARKET-VALUE> 26,221,053
<EQUITIES> 613,801
<MORTGAGE> 0
<REAL-ESTATE> 0
<TOTAL-INVEST> 49,109,257
<CASH> 3,710,010
<RECOVER-REINSURE> 0
<DEFERRED-ACQUISITION> 13,122,469
<TOTAL-ASSETS> 79,296,195
<POLICY-LOSSES> 2,701,438
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0
0
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3,176,270
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</TABLE>
