SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of
the Securities Exchange Act of 1934
Date of Report: September 22, 1997
(Date of earliest event reported)
CITIZENS, INC.
(Exact name of registrant as specified in its charter)
COLORADO
(State or other jurisdiction of
incorporation)
0-16509 84-0755371
(Commission File Number) (IRS Employer
Identification Number)
400 East Anderson Lane
Austin, Texas 78752
(Address of principal (Zip Code)
executive offices)
(512) 837-7100
(Registrant's telephone number)
Item 1. Changes in Control of Registrant.
None.
Item 2. Acquisition or Disposition of Assets.
None.
Item 3. Bankruptcy or Receivership.
None.
Item 4. Certifying Accountants.
None.
Item 5. Other Events.
On September 22, 1997, Registrant was notified that class
action certification was granted September 15, 1997 to plaintiffs
in a lawsuit (Dwain Kirkham et al. v. American Liberty Life
Insurance Company et al., No. 25,954, 2nd Judicial District,
Jackson Parish, Louisiana) filed against American Liberty Life
Insurance Company ("ALLIC") on August 19, 1996 and against
Citizens, Inc. on December 20, 1996 (collectively "Defendants").
In the same ruling, Defendants' motion for summary judgment and
exception of prescription (statute of limitations) were denied.
Defendants believe that these rulings are significantly in error.
Defendants will appeal these rulings, during which time, the
trial court proceedings will be stayed. Defendants intend to
vigorously defend against these claims.
The lawsuit was filed by four individuals who purchased from
ALLIC, prior to August 1, 1986, life insurance policies on their
children and grandchildren. In the complaint, plaintiffs allege
that the insurance policies were fraudulently misrepresented to
be "retirement" and "insured savings" plans in which, after six
or seven years, additional premiums would be unnecessary and
monthly retirement income would be generated for plaintiffs.
Plaintiffs also allege other causes of action including breach of
contract and are seeking rescission, unspecified damages,
interest and attorneys' fees. Prior to the class certification
ruling, rescission of the insurance policies purchased by the
four plaintiffs would have resulted in a total payment of $31,000
(including 33% for contingent attorneys fees). The activities
described in plaintiffs' complaint allegedly occurred over 10
years ago with respect to certain types of insurance policies
sold by an independent general agent. Prior to its recent merger
into Registrant's principal subsidiary, Citizens Insurance
Company of America, ALLIC was a separate subsidiary of Registrant
since its acquisition in September 1995.
As part of the acquisition, not all historical records of
ALLIC were loaded on the computer system currently used.
Further, no officers or managers of ALLIC are currently employed
by Registrant or any of its affiliates. Due to the unexpected
nature of this ruling, the historical records have not been
examined to determine the potential magnitude of these claims in
the event of class action certification. Management will be
examining ALLIC's historical records to determine if such an
estimate can be developed.
Item 6. Resignations of Registrant's Directors.
None.
Item 7. Financial Statements and Exhibits.
None.
Item 8. Change in Fiscal Year.
None.
Item 9. Sales of Equity Securities Pursuant to Regulation S
None.
SIGNATURE
Pursuant to the requirement of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on Registrant's behalf by the undersigned, duly authorized and
empowered officer of the Registrant.
CITIZENS, INC.
By:/s/ Mark A. Oliver
Mark A. Oliver, FLMI
President
Date: September 24, 1997
