UNITED STATES
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 (Date of Earliest Event Reported):
October 16, 1998
CITIZENS CORPORATION
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(Exact name of Registrant as specified in its charter)
Delaware 1_11714 04_3178765
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(State or other jurisdic- (Commission File Number) (I.R.S. Employer
tion of Incorporation I.D. Numer)
440 Lincoln Street, Worcester, Massachusetts 01653
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(Address of Principal Executive Offices)
(Zip Code)
(508) 855-1000
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(Registrant's Telephone Number including area code)
Page 1 of 5 pages
Exhibit Index on page 4
Item 5. Other Events.
On October 15, 1998, Citizens Corporation announced
that third quarter results will be adversely impacted by
$18.6 million in pre-tax catastrophe losses, including the
$6.8 million previously reported on July 31, 1998. These
additional losses incurred during the months of July and
September are attributable to electrical, rain and wind
storms in the Michigan area totaling $13.7 million. In
addition, there has been $4.9 million of loss development
on prior storms reported in the months of May and June.
Item 7. Financial Statements and Exhibits
Exhibit 99 Press Release dated October 15, 1998,
announcing Citizens Corporation expects an adverse impact
on third quarter results due to catastrophe losses.
SIGNATURES
Pursuant to the requirements of the Securities and
Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned
hereunto duly authorized.
CITIZENS
CORPORATION
By:/s/ Edward J. Parry III
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Edward J. Parry III
Vice President, Chief
Financial Officer, and
Treasurer
Date: October 16, 1998
Exhibit Index
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Exhibit 99 Press Release dated October 15, 1998, announcing
Citizens Corporation expects an adverse impact
on third quarter results due to catastrophe
losses.
Exhibit 99
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ALLMERICA FINANCIAL AND CITIZENS CORPORATION ANNOUNCE THIRD
QUARTER OPERATING EARNINGS
WORCESTER, Mass., October 15, 1998 - Allmerica Financial
Corporation (NYSE:AFC) today said it expects third quarter
operating earnings to be adversely impacted by $0.25 to
$0.30 per share of unusual losses related to increased
frequency of catastrophes and lower investment income. The
two unusual items are expected to result in 1998 third
quarter operating earnings falling below both analysts'
estimates and the $0.90 per share Allmerica Financial
reported in the third quarter of 1997.
John F. O'Brien, president and chief executive officer said,
"While we continue to gain market share in the variable
products business and we are making good progress on expense
reductions in the Risk Management operation, we had unusual
items in the quarter which impacted current earnings."
Pretax catastrophe losses in the property and casualty
segment in the third quarter totaled $28.7 million.
Catastrophe losses stemmed from six events totaling $10.1
million at Hanover Insurance and two events totaling nearly
$18.6 million at Citizens Corporation (NYSE:CZC). For
Allmerica Financial's property and casualty operation in
total, year-to-date pretax catastrophe losses stand at $82.6
million, more than double the average catastrophe experience
for Allmerica Financial's property and casualty operation
over the past five years.
Pretax net investment income includes a $11.7 million loss
related to three limited partnerships that primarily engaged
in fixed income arbitrage. In addition to operating losses
from these investments, Allmerica Financial has incurred
realized losses of $18.5 million related to reducing the
carrying value of these assets.
Allmerica Financial Corporation is the holding company for a
diversified group of insurance and financial services
companies headquartered in Worcester, Mass.
- 30 -
Investor contact: Jean Peters
(508) 855-3599
AF-34
10/15/1998
