Primerica Inc Q4 2024 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Wilma Burdis - Raymond James & Associates - Analyst : Could you talk about -- is 5% ADP growth, a good run rate? Or is there still a boost in that figure from the IPO reinsurance transaction?

Question: Wilma Burdis - Raymond James & Associates - Analyst : Okay. Great. And then could you talk about what's driving the strong ISP sales despite a little bit of pressure on the life side due to cost of living pressures? And then along those same lines, how do you see lapses trending into 2025? Is there some evidence that we put a peak?

Question: Wilma Burdis - Raymond James & Associates - Analyst : No. I think that covers it.

Question: John Barnidge - Piper Sandler & Co. - Analyst : Just kind of building on that comment about cost of living pressures and is taking a couple of years to correct. What's the expected duration of that catch-up? And can that really be corrected with that improvement in the cost of living?

Question: John Barnidge - Piper Sandler & Co. - Analyst : My follow-up question with that, what's the opportunity in that backdrop to increase operational leverage through improved application speed automation? So maybe what took 10 minutes could take three and then it allows the application volume to increase and average agent to be more productive. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2025 / 3:00PM, PRI.N - Q4 2024 Primerica Inc Earnings Call

Question: Mark Hughes - Truist Securities - Analyst : The good VA activity, you're talking about how the large transactions drive volumes. There's a lot of money in motion. Is this a demographic tailwind that should persist?

Question: Mark Hughes - Truist Securities - Analyst : And then Tracy, anything on the mortality front? Any changes you might have observed either in the US or Canada?

Question: Mark Hughes - Truist Securities - Analyst : It does. And then final question, just for my edification, you said the remeasurement loss is not related to assumption changes but a refinement of the model. Can you say what that refinement was? Or is it more technical?

Question: Mark Hughes - Truist Securities - Analyst : It does.

Question: Suneet Kamath - Jefferies LLC - Analyst : So I wanted to focus on the Life segment just for a minute. It looked like the rep count was up, I guess, 7% year-over-year, but policies issued was up maybe 1%. And I guess, shouldn't we see a tighter sort of correlation between those two growth rates? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2025 / 3:00PM, PRI.N - Q4 2024 Primerica Inc Earnings Call

Question: Suneet Kamath - Jefferies LLC - Analyst : Got it. That makes sense. And then I guess if I heard correctly, it sounds like your guidance for life agent growth for 2025 is around 3%, which is lower than I think it's been historically. Is there something unusual about 2025? Or are you sort of getting to the point where the sales force is kind of so big, it just becomes harder to grow on top of these big numbers?

Question: Suneet Kamath - Jefferies LLC - Analyst : Got it. If I could just sneak one more in just on the VA. Do you currently sell the RILA product? Is that a big part of what you're selling these days?

Question: Suneet Kamath - Jefferies LLC - Analyst : Correct. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2025 / 3:00PM, PRI.N - Q4 2024 Primerica Inc Earnings Call

Question: Dan Bergman - TD Securities - Analyst : I guess to start with the higher share repurchase authorization for 2025 and a pretty big increase in the dividend, capital return looks like it will take another sizable step-up this year. Was there anything unusual in the 2024 statutory earnings? Is there any other onetime items that are boosting that? Or should we think of this as a pretty sustainable level going forward? And I guess, relatedly, what capital are trying to think was 79% of earnings in 2024, is that around where we should expect that ratio to remain longer term?

Question: Dan Bergman - TD Securities - Analyst : Yeah. Very helpful. And then maybe --

Question: Dan Bergman - TD Securities - Analyst : Got it. Yeah, very, very helpful. And then maybe just switching gears a little bit, following up on the earlier comments around technology. It sounds like higher tech spend is a big driver of the growth in the insurance and operating expenses you're guiding to in 2025. So should we think of this higher technology spend as a new run rate going forward? Or are there any lumpy expenses in there that should subside going forward? I guess maybe said differently, what inning are you in regarding upgrading your technology capabilities? So any color just around that would be great.

Question: Jack Matten - BMO Capital Markets - Analyst : So a follow-up question on the outlook for Term Life-issued policies. You talked about cost of living headwinds to put pressure on lapse rates. I'm wondering if you could unpack or quantify how much of a headwind it's been to sales levels over the past year and how much is influencing the guidance for 2% growth in mission policies this year? I think you mentioned they have been of a conservative estimate.

Question: Jack Matten - BMO Capital Markets - Analyst : That's very helpful. And just a question on the ISP redemption rates, think like outflows as a percent of beginning assets have started to trend lower in recent quarters. I guess could you just talk about some of the drivers impacting that? I mean do you expect some upward pressure still from some of those cost-of-living challenges or even just given that client asset values are higher levels following kind of the strong market performance over the past couple of years?