Item 1. BUSINESS
Kansas City Life Insurance Company (KCL) was incorporated under the assess-ment laws of Missouri in 1895 as the Bankers Life Association. In 1900, its present corporate title was adopted and it was reorganized as a legal reserve company in 1903. The Company operates nationwide, being licensed in 48 states and the District of Columbia.
The Company primarily operates in four business segments: Kansas City Life Insurance Company, divided between its individual and group businesses, and its two insurance affiliates, Sunset Life Insurance Company of America (Sunset) and Old American Insurance Company (Old American). KCL markets its individual products, principally interest sensitive and variable products, through a career general agency sales force and these products generate 41% of consolidated insur-ance revenues. Variable universal life and annuities totaled 65% of new statutory premiums in 2000. The group products, largely life, disability and administrative services only, are sold through the general agency sales force and appointed group agents. Group revenues account for 21% of insurance revenues. Sunset markets interest sensitive and traditional products to individuals through a personal pro-ducing general agency system. Sunset operates in 40 states and is in the process of filing for admission to operate in most of the remaining states. This segment provides 10% of revenues. The Old American segment markets whole life final expense products to seniors through a general agency sales force. Old American operates in 46 states and accounts for 28% of consolidated insurance revenues.
Old American and Sunset's administrative operations are merged into KCL's home office and its administrative and accounting systems. However, each entity operates a separate and independent marketing department and field force.
KCL and its subsidiaries are subject to state regulations in their states of domicile and in the states in which they do business. Although the federal govern-ment generally does not regulate the business of insurance, federal initiatives often have an impact on the business in a variety of ways including the taxation of insurance companies and the tax treatment of insurance products.
KCL and its subsidiaries have 633 full time employees located in the home office.
The Company is engaged in a competitive industry, competing with 1,500 to 2,000 other life insurance companies in the United States. The industry is highly competitive with respect to pricing, selection of products and quality of service. No single competitor nor any small group of competitors dominates any of the markets in which the Company operates.
Item 2.
Item 2. PROPERTIES
Kansas City Life's home office is located at 3520 Broadway in Kansas City, Missouri. The Company owns and wholly occupies two five story buildings on an eight acre site.
The Company owns various other properties held for investment.
Item 3.
Item 3. LEGAL PROCEEDINGS
In recent years, the life insurance industry, including the Company and its subsidiaries, have been subject to an increase in litigation pursued on behalf of purported classes of insurance purchasers, questioning the conduct of insurers in the marketing of their products. The Company believes that the actions described below are part of this trend. The Company denies all allegations of wrongdoing in these lawsuits, and has been defending them vigorously.
David Bahr, et al, v. Kansas City Life Insurance Company, Frank Sherlock, et al, San Bernardino County, California Superior Court, Case No. SCVSS 58192. This case concerns life insurance policies and annuities sold by the Company to David Bahr's now-deceased father, John Bahr. The Bahrs claim that the elderly John Bahr was fraudulently misled into purchasing insurance products from Kansas City Life by the involved insurance agents. The Bahrs also claim John Bahr was a victim of elder abuse under California Welfare and Institutions Code Section 15610.30. The Bahrs, as "private attorneys general", also allege a representative cause of action under California Code Section 17200 on behalf of the California general public against the Company, alleging that the Company engaged in fraud- ulent insurance sales and marketing practices and unfair business practices, including improper replacement transactions, and that the Company must disgorge all so-called ill-gotten gains. A fourth amended complaint was filed on October 30, 2000. The fourth amended complaint adds a cause of action for breach of an alleged settlement agreement to resolve the case for $200,000. The case is set for trial in June, 2001. The Company does not believe there is an enforceable settlement agreement. Management denies the allegations, including the existence of a legitimate class and the existence of a uniform unfair business practice capable of resolution under Section 17200 and intends to defend this matter vigorously. Although no assurances can be given and no determination can be made at this time as to the outcome of this litigation, management believes that the relief ultimately granted to the plaintiffs, if any, would have no material effect on the Company's business, results of operations and financial position.
In the previously reported case of Bette Schwager, On Behalf of Herself and All Others Similarly Situated v. Kansas City Life Insurance Company, United States District Court for the Western District of Texas, Austin Division, Case No. A-00-CA-424-JN. Originally filed in the 345th Judicial District Court for Travis County, Texas on June 8, 2000 as Case No. GN-001652. On the Company's motion, the case was removed to the United States District Court for the Western District of Texas. Plaintiff alleges fraud, fraudulent concealment, unfair dis-crimination, breach of contract, breach of fiduciary duty/constructive fraud, and negligent misrepresentation in connection with the sale of life insurance policies to herself and to her husband and to all others similarly situated. Plaintiff alleges that the Company through its agents engaged in a state-wide fraudulent scheme and common course of conduct and seeks to certify a class composed of all persons and entities who have or had an ownership interest in one or more of the Company's permanent policies from and after January 1, 1986 to the present. In November, 2000, Mrs. Schwager alleged that the attorneys who filed the petition did so without her consent. The attorneys who filed the petition have withdrawn and Mrs. Schwager is proceeding pro se. Management denies the allegations of the complaint including the existence of the certifiable class and intends to defend this case vigorously. Although no assurances can be given and no determinations can be made at this time as to the outcome of this litigation, management believes that the relief ultimately granted to the plaintiff, if any, would have no material effect on the Company's business, results of operations and financial position.
The previously reported case of Stewart, et al, v. Security Benefit Life Insurance Company and Bank Market Service, Inc., filed in November, 1998 in the Tenth Judicial District Court of Johnson County, Kansas, Case No. 98-C04036, has been settled. The Company defended this case pursuant to the terms of a coin-surance agreement with Security Benefit Life Insurance Company (SBL). The case was originally brought by four SBL policyowners who alleged that SBL, through its agent, Bank Market Service, Inc., improperly sold life insurance policies as retirement plans. Following the trial court's denial of plaintiffs' motion to certify a class comprised of all persons who had purchased similar policies between 1977 and 1988, the Company settled with the four individual plaintiffs for nominal amounts.
In the previously reported case of Wilner v. Sunset Life Insurance Company, Dean Delevie, et al, California Superior Court, Case No. SC051573, filed March 9, 1998 in Los Angeles Superior Court, plaintiff sued Sunset Life Insurance Company, a subsidiary, and one of its agents for unspecified compensatory and punitive damages alleging various forms of deceit, breach of fiduciary duty, and negligence in connection with the sale of a universal life insurance policy as a replacement for an existing policy. Subsequently, the plaintiff amended her complaint to seek class action status and to add a claim under California's Business and Professions Code Section 17200 which authorizes individual plaintiffs to sue on behalf of the public to remedy alleged unfair business practices, and to seek declaratory and injunctive relief. Sunset obtained a dismissal of the breach of fiduciary duty claim and the class action allegations, but the trial court refused to dismiss the Section 17200 allegations. All parties appealed and the court of appeals refused to overrule the trial court's failure to dismiss the Section 17200 claims and remanded the case for further discovery and proof regarding the class action allegations. Extensive discovery has been conducted. In the course of discovery, the court has ordered the disclosure of the names of all individuals who purchased universal life insurance policies from Sunset in replacement transactions from 1984 to the present and of all individuals who purchased Sunset universal life policies during that period and whose policies became under-funded. These individuals are currently being contacted, pursuant to court order, to determine whether they are willing to discuss this action with counsel for plaintiff and/or counsel for Sunset and it is expected that this contact will create further litigation. Plaintiff has filed a motion for certification as a class action and the hearing is presently scheduled on that motion for May, 2001. Management denies the allegations, including the existence of a legitimate class and the existence of a uniform unfair business practice capable of resolution under Section 17200 and intends to defend this matter vigorously. However, no assurances can be given regarding the outcome of this lawsuit.
In addition to the above, the Company and its subsidiaries are defendants in, or subject to other claims or legal actions that may rise in the ordinary course of business. Some of these claims and legal actions are in jurisdictions where juries sometime award punitive damages grossly disproportionate to actual damages. Although no assurances can be given and no determinations can be made at this time, management believes that the ultimate liability, if any, with respect to these other claims and legal actions, would have no material effect on the Company's business, results of operations and financial position.
Item 4.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of the stockholders of the Company during the fourth quarter of the fiscal year ended December 31, 2000.
PART II
Item 5.
Item 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Incorporated by Reference.
Item 6.
Item 6. SELECTED FINANCIAL DATA
Incorporated by Reference.
Item 7.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION
Incorporated by Reference.
Item 7A.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Incorporated by Reference.
Item 8.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Incorporated by Reference.
Item 9.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Not Applicable.
PART III
Item 10.
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The following information, as of December 31, 2000, is provided with respect to each Director and Nominee:
Term as Director Served as Expires Other Positions Director Name of Director Age in April with the Company From
William R. Blessing 46 -- None Nominee (1)(2)
Jack D. Hayes (1)(3) 60 2001 Senior Vice President- 1995 Emeritus, Marketing
Cecil R. Miller (1)(2) 66 -- None Nominee
Michael J. Ross 59 2001 None 1972 (1)(2)(4)(5)(6)
Elizabeth T. Solberg 61 2001 None 1997 (1)(2)
Walter E. Bixby (2) 41 2002 None 1996
Webb R. Gilmore 56 2002 None 1990 (2)(4)(5)(6)
Nancy Bixby Hudson (2) 48 2002 None 1996
Daryl D. Jensen (2) 61 2002 None 1978
Term as Director Served as Expires Other Positions Director Name of Director Age in April with the Company From
C. John Malacarne 59 2002 Vice President, 1991 (3)(4) General Counsel and Secretary
J. R. Bixby (3)(4) 75 2003 Chairman of the Board 1957
R. Philip Bixby 47 2003 President, CEO and Vice 1985 (3)(4) Chairman of the Board
Richard L. Finn 59 2003 Senior Vice President, 1983 (3)(4) Finance
Warren J. Hunzicker, M.D. 80 2003 None 1989 (2)
Larry Winn, Jr. 81 2003 None 1985 (2)(4)(5)(6)
(1) Subject to the approval of the shareholders at the annual meeting of share-holders to be held on April 19, 2001, will be elected for a three year term ending in 2004.
(2) Walter E. Bixby was elected Assistant Vice President of the Company in 1985, Vice President, Marketing in 1990, Vice President, Marketing Operations in 1992, and President of Old American, a subsidiary, in 1996. He also serves as a Director of Sunset Life and Old American, subsidiaries. Mr. Blessing is currently Vice President, Business Development and Strategy, Sprint PCS, Kansas City, Missouri, a position he has held since 1998. He has been with Sprint and related entities in various capacities since 1981. Mr. Gilmore is Chairman, CEO and Shareholder of the law firm of Gilmore & Bell. Nancy Bixby Hudson has served as a Director of Sunset Life, a sub- sidiary, since 1986. Dr. Hunzicker was elected by the Board of Directors to an unexpired term in 1989. Dr. Hunzicker served as the Company's Medical Director from 1987 to 1989; he formerly served as a member of the Company's Board of Directors from 1977 to 1980. Mr. Jensen served as President of Sunset Life, a subsidiary of Registrant, from 1973 until his retirement in 1999. Mr. Jensen serves as a Director of Sunset Life and Generations Bank, subsidiaries. Mr. Miller is a retired partner of KPMG LLP (formerly Peat, Marwick, Mitchell & Co.) Mr. Miller joined KPMG in 1957 and became an audit partner in 1962 specializing in insurance and agribusiness. He retired in 1990. Mr. Ross has been Chairman of the Board of Jefferson Bank and Trust Company, St. Louis, Missouri, since 1983. Mr. Ross also serves as a Director of Generations Bank, a subsidiary. Mrs. Solberg became a Regional President and Senior Partner of Fleishman-Hillard, Inc., in January, 1998. She had been Executive Vice President since 1984. She also serves as a Director ofGenerations Bank, a subsidiary. Mr. Winn is retired as the Kansas Third District Representative to the U.S. Congress.
(3) See below with respect to the business experience of executive officers of the Company.
(4) Member of Executive Committee.
(5) Member of Audit Committee.
(6) Member of Compensation Committee.
Name, Age and Business Experience Position During Past 5 Years
J. R. Bixby, 75 Chairman since 1972; President from 1964 until he Chairman of the Board retired in April, 1990. Responsible for overall corporate policy. Chairman of the Board of Sunset Life and Old American, subsidiaries.
R. Philip Bixby, 47 Elected Assistant Secretary in 1979; Assistant Vice President, CEO and Vice President in 1982; Vice President in 1984; Senior Chairman of the Board Vice President, Operations in 1990; Executive Vice President in 1996; President and CEO in April, 1998; and Vice Chairman of the Board in January, 2000. Director and President of Sunset Life, Director of Old American, and Director of Generations Bank, subsidiaries.
Richard L. Finn, 59 Elected Vice President in 1976; Financial Vice Presi- Senior Vice President, dent in 1983; and to present position in 1984. Chief Finance financial officer and responsible for investment of the Company's funds, accounting and taxes. Director and Treasurer of Sunset Life, Director, Vice Presi- dent and Chief Financial Officer and Assistant Treasurer of Old American, and Director of Generations Bank, subsidiaries.
Jack D. Hayes, 60 Elected Senior Vice President, Marketing in February, Senior Vice President- 1994; and to present position in October, 2000. Emeritus, Marketing Responsible for Marketing, Marketing Administration, Communications and Public Relations. Served as Executive Vice President and Chief Marketing Officer of Fidelity Union Life, Dallas, Texas, from June, 1981 to January, 1994.
Mark A. Milton, 42 Elected Assistant Actuary in 1984; Assistant Vice Senior Vice President President/Associate Actuary in 1987; Vice President/ and Actuary Associate Actuary in 1989; Vice President and Actuary in January, 2000; and to present position in January, 2001. Responsible for Actuarial Services, State Compliance and Group. Director, Vice President and Actuary of Sunset Life, a subsidiary.
Michael P. Horton, 58 Elected Director, Group Life/Sales in 1977; Assistant Vice President, Group Vice President, Group in 1981; and to present position in 1984. Responsible for group sales and products.
Robert C. Miller, 54 Elected Assistant Auditor in 1972; Auditor in 1973; Senior Vice President, Vice President and Auditor in 1987; and to present Administrative Services position in 1991. Responsible for Human Resources and Administrative Functions.
Charles R. Duffy, Jr., 53 Elected Vice President, Computer Information Services Senior Vice President, in 1989; Vice President, Insurance Administration in Operations 1992; and to present position in 1996. Responsible for the Company's Computer Operations, Customer Services, Claims, Agency Administration, New Business, Medical and Underwriting. Director of Sunset Life and Old American, subsidiaries.
John K. Koetting, 55 Elected Assistant Controller in 1975; and to present Vice President and position in 1980. Chief accounting officer Controller responsible for all corporate accounting reports. Director of Old American, a subsidiary.
Name, Age and Business Experience Position During Past 5 Years
C. John Malacarne, 59 Elected Associate General Counsel in 1976; General Vice President, General Counsel in 1980; Vice President and General Counsel Counsel and Secretary in 1981; and to present position in 1991. Responsible for Legal Department, Office of the Secretary, Stock Transfer Department and Market Compliance. Director and Secretary of Sunset Life, Old American, and Generations Bank, subsidiaries.
(d) Nancy Bixby Hudson is the daughter of J. R. Bixby; R. Philip Bixby and Walter E. Bixby are brothers and the nephews of J. R. Bixby.
(e) See Business Experience During Past 5 Years above.
(f) There have been no events under any bankruptcy act, no criminal pro-ceedings and no judgments or injunctions material to the evaluation of the ability and integrity of any Director, nominee or executive officer during the past five years.
Item 11.
Item 11. EXECUTIVE COMPENSATION
(a) Compensation
The following table sets forth information concerning cash compensation paid or accrued by the Company and its subsidiaries to the Chief Executive Officer and the other four most highly paid executive officers as of December 31, 2000 for the fiscal years ending December 31, 2000, 1999 and 1998.
SUMMARY COMPENSATION TABLE
Long Term Other All Annual Compensation Incentive Annual Other Compensa- Compen- Compen- Name and Salary Bonus tion Payouts sation sation Principal Position Year $ $ $ $ $ R. P. Bixby, Presi- 2000 443,700 400 0 7,000 42,287 dent, CEO and Vice 1999 405,180 41,931 0 7,000 26,853 Chairman of the Board, 1998 348,692 77,971 0 7,000 22,857 Kansas City Life; Director of Sunset Life, Old American, and Generations Bank, subsidiaries.
R. L. Finn, Senior 2000 242,160 9,049 0 7,000 24,904 Vice President, 1999 231,720 22,680 0 7,000 17,650 Finance and Director, 1998 221,712 33,748 0 7,000 17,842 Kansas City Life; Director of Sunset Life, Old American, and Generations Bank, subsidiaries. _______________________________________________________
J. D. Hayes, Senior 2000 210,360 4,004 0 4,000 22,986 Vice President- 1999 201,300 39,973 0 4,000 15,275 Emeritus, Marketing, 1998 192,624 71,211 0 4,000 15,621 and Director, Kansas City Life. _______________________________________________________
C. R. Duffy, Jr., 2000 202,020 14,654 0 3,000 18,385 Senior Vice President, 1999 188,760 18,349 0 3,000 12,483 Operations, Kansas City 1998 175,572 31,400 0 0 12,699 Life; Director of Sunset Life and Old American, subsidiaries. _______________________________________________________
C. J. Malacarne, Vice 2000 202,740 14,886 0 7,000 20,809 President, General 1999 193,980 20,403 0 7,000 14,718 Counsel and Secretary 1998 185,592 23,244 0 7,000 14,861 and Director, Kansas City Life; Director and Secretary of Sunset Life, Old American and Generations Bank, sub- sidiaries. _______________________________________________________
ALL OTHER COMPENSATION INCLUDES THE FOLLOWING:
The Company has a contributory Internal Revenue Code Section 401(k) savings and profit sharing plan. Directors and officers who are full time employees of the Registrant or its subsidiaries participate in the plan on the same basis as all other employees. Employees may contribute from 1% to 15% of their monthly base salary. Highly compensated employees are limited to contributions of 6%. The Company contributes an amount equal to 50%, 75% or 100% of the employee contributions based on a schedule of years of employment to a maximum of 6% of an employee's compensation in the form of capital stock of the Company. The amount contributed to the plan in 2000 for the accounts of the named individuals are as follows: R. P. Bixby, $10,200; R. L. Finn, $10,200; J. D. Hayes, $10,200; C. R. Duffy, Jr.,$10,200; C. J. Malacarne, $10,200. The Company has adopted a nonqualified deferred compensation plan for approximately 44 highly compensated officers and employees. It is similar to the Company's 401(k) plan. Participants contribute amounts to this plan that they cannot contribute to the 401(k) plan up to a total of 15% of their monthly salary and the Company contributes up to a maximum of 6% of their monthly salary. The amount contributed to the plan in 2000 for the accounts of the named indi-viduals are as follows: R. P. Bixby, $16,422; R. L. Finn, $4,330; J. D. Hayes, $2,422; C. R. Duffy, Jr., $1,921; C. J. Malacarne, $1,964.
The Company provides yearly renewable term insurance to its employees in the amount of 2 1/2 times their annual salary. Directors and officers who are full time employees participate in the program on the same basis as all other employees. Premiums paid for the named individuals for 2000 are as follows: R. P. Bixby, $1,907; R. L. Finn, $2,866; J. D. Hayes, $3,841; C. J. Malacarne, $2,357.
The Company has a three year long term incentive plan in place for senior management that awards participants for the increase in the price of the Company's common stock from January 25, 2000 through January 24, 2003. Participants are awarded units (phantom shares) based on their annualized salary divided by the share price of $32.25 as of January 21, 2000. At the conclusion of the plan, participants receive awards based on the increase in the per share price times their number of units. Participants are also awarded dividends on these shares commensurate with the Company's dividend policy. Payments equivalent to divi- dends received by the named individuals and included in All Other Compensation are as follows: R. P. Bixby, $13,758; R. L. Finn, $7,509; J. D. Hayes, $6,523; C. R. Duffy, Jr., $6,264; C. J. Malacarne, $6,287.
(f) Defined Benefit or Actuarial Plan Disclosure
The Company has a noncontributory defined benefit pension plan which covers employees age 21 and over. Effective January 1, 1998, the pension plan was con-verted to a cash balance plan. Benefits under the plan will no longer be determined primarily by final average compensation and years of service. Each participant's benefit accrued under the prior plan formula as of December 31, 1997 was converted to an opening account balance in the cash balance plan.
Beginning in 1998, participants accumulate annual pay credits equal to a percentage of annual compensation, ranging from 3% to 16% based on service of the participant. The cash balance account is further credited with interest annually which is based on the 30-year treasury bond rate in effect for November of the prior plan year. Upon termination of employment, the account balance as of such date may be distributed to the participant in lump sum or annuity form, at the election of the participant. Benefits vest according to years of service after age 18 on a graded scale, beginning with 30% vesting with 3 years, and becoming 100% vested with 7 years. Compensation for determining benefits under the plan is equal to base salary, excluding overtime and bonuses.
Participants age 55 with 15 years of service as of December 31, 1997 will receive the greater of the benefit under the cash balance plan, or the prior plan formula based on final average compensation and years of service. The following table illustrates the possible annual pension benefits under the prior plan formula based upon final average compensation and years of service, for these employees. Participants may elect a lump sum distribution.
PENSION PLAN TABLE
Compensation Years of Service SS**
10 20 30 40
$ 75,000 $ 18,750 $ 37,500 $ 51,390* $ 51,390* $17,220 100,000 25,000 50,000 70,000 71,390* 17,220 125,000 31,250 62,500 87,500 91,390* 17,220 150,000 37,500 75,000 105,000 111,390* 17,220 200,000 50,000 100,000 140,000 151,390* 17,220 250,000 62,500 125,000 175,000 191,390* 17,220 300,000 75,000 150,000 210,000 231,390* 17,220 350,000 87,500 175,000 245,000 271,390* 17,220 400,000 100,000 200,000 280,000 311,390* 17,220 450,000 112,500 225,000 315,000 351,390* 17,220 500,000 125,000 250,000 350,000 391,390* 17,220
*Maximum pension based on an estimate of Social Security **Estimated annual Social Security benefit at age 65
A participant's base salary not to exceed $150,000 (as adjusted for cost of living) commencing January 1, 1994, was used to determine compensation under the plan for benefits from the qualified plan. For the individuals named in the Cash Compensation Table, the years of service covered by the plan for the year ended December 31, 2000, were: R. P. Bixby, 23 years; R. L. Finn, 27 years; J. D. Hayes, 7 years; C. R. Duffy, Jr., 11 years; C. J. Malacarne, 34 years.
The estimated annual annuity benefit payable starting at normal retirement age (age 65) as accrued through December 31, 2000 under the cash balance plan for each of the named individuals are as follows: R. P. Bixby, $169,454; R. L. Finn, $141,689; J. D. Hayes, $20,167; C. R. Duffy, Jr., $28,574; C. J. Malacarne, $136,571.
The Company has adopted an unfunded excess benefit plan which covers any employee who is an active participant in the non-contributory defined benefit pension plan and whose pension benefit under that plan would exceed the maximum benefit limited under Internal Revenue Code Section 415. A participant under this plan is entitled to a monthly benefit of the difference between the maximum monthly normal, early, or deferred vested retirement benefit determined without regard to the Internal Revenue Code Section 415 limitation and the monthly equivalent of the maximum benefit permitted by Internal Revenue Code Section 415. Participants may elect a lump sum distribution.
(g) Compensation of Directors
Outside Directors are paid $4,000 quarterly; $2,000 if they attend Special Board Meetings; $1,000 if they attend Executive Committee Meetings; $500 if they attend all other Committee Meetings. Inside Directors are paid $1,000 quarterly and $400 if they attend Special Board Meetings. The Chairman of the Board is paid $30,000 quarterly. Outside Directors of Sunset Life, a subsidiary, are paid $1,000 quarterly, inside Directors are paid $500 quarterly. The Chairman of the Board is paid $11,250 quarterly. Directors of Old American are paid $250 quarterly. The Chairman of the Board is paid $6,250 quarterly. Director fees are included in the Compensation Table.
(h) Employment Contracts and Termination of Employment and Change in Control Arrangements
There are no employment contracts between the Company and its executive officers. The Company's benefit plans contain typical provisions applicable to all employees for termination of employment.
(j) Additional Information with Respect to Compensation Committee
The members of the Compensation Committee: Webb R. Gilmore, Michael J. Ross and Larry Winn, Jr.
Item 12.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) Security Ownership of Certain Beneficial Owners
The following table sets forth information as of March 15, 2001, con- cerning certain beneficial owners of voting securities of the Company's $1.25 par value capital stock ("common stock"). The common stock is the Company's only class of voting securities. As described in the notes to the table set forth below, certain named persons share the power of voting and disposition with respect to certain shares of common stock. Consequently, such shares are shown as being beneficially owned by more than one person.
Name and Address Percent of Class
John K. Koetting, Robert C. Miller and Anne C. Moberg, Trustees of the Kansas City Life Insurance Company Savings and Profit Sharing Plan and the Kansas City Life Employee Stock Plan 3520 Broadway Kansas City, MO 64111-2565
Amount and Nature of Ownership(1)
866,512 Shares 7.2
WEB Interests, Ltd. 3520 Broadway Kansas City, MO 64111-2565
Amount and Nature of Ownership(2)
2,358,340 Shares 19.6
Angeline I. O'Connor 12501 Granada Lane Leawood, KS 66209
Amount and Nature of Ownership(2)(3)
3,080,583 Shares 25.6
JRB Interests, Ltd. 3520 Broadway Kansas City, MO 64111-2565
Amount and Nature of Ownership(4)
2,966,312 Shares 24.6
Margie Morris Bixby 3530 Pennsylvania Kansas City, MO 64111
Amount and Nature of Ownership(4)(5)
2,968,112 Shares 24.7
Lee M. Vogel 4701 NW 59th Court Kansas City, MO 64151
Amount and Nature of Ownership(4)(6)
2,973,410 Shares 24.7
(1) Trustees have the power to sell plan assets. Participants may instruct the Trustees how to vote their shares.
(2) The WEB Interests, Ltd. is a Texas limited partnership (the "WEB Partner-ship"). Each partner of the WEB Partnership has the power to vote that number of shares of Common Stock owned by the WEB Partnership which equals such partner's proportionate interest in the WEB Partnership.
(3) Includes 2,358,340 shares for which Angeline I. O'Connor ("Ms. O'Connor") shares the power of disposition as a co-managing general partner of the WEB Partnership. Of these shares, Ms. O'Connor: (a) as a co-managing general partner of the WEB Partnership, in her capacity as a co-trustee of the Walter E. Bixby, Jr. Revocable Trust, shares the power to vote 2,140,578 shares; (b) as the sole trustee of the Angeline I. O'Connor GST Trust and the Issue Trust for Angeline I. O'Connor, which trusts are limited partners of the WEB Partnership, has the power to vote 69,355 shares; and (c) as a general partner of the WEB Partnership, in her individual capacity, has the sole power to vote 215 shares. Also includes: (a) 368,555 shares for which Ms. O'Connor, as a co-trustee with R. Philip Bixby and Walter E. Bixby of the Walter E. Bixby Descendants Trust, shares the power to vote and the power of disposition; and (b) 353,688 shares which Ms. O'Connor owns directly and has the sole power to vote and the sole power of disposition.
(4) The JRB Interests, Ltd. is a Texas limited partnership (the "JRB Partner- ship"). Each partner of the JRB Partnership has the power to vote that number of shares of Common Stock owned by the JRB Partnership which equals such partner's proportionate interest in the JRB Partnership.
(5) Includes 2,966,312 shares for which Margie Morris Bixby ("MM Bixby"), as trustee of the Margie Morris Bixby Revocable Trust (the "MMB Trust"), a general partner and a limited partner of the JRB Partnership, shares the power of disposition. Of these shares, MM Bixby (a) as a general partner and a limited partner of the JRB Partnership, in her capacity as sole trustee of MMB Trust, has the sole power to vote 26,898 shares; and (b) as a limited partner of the JRB Partnership, in her individual capacity, has sole power to vote 335 shares. Also includes, 1,800 shares for which MM Bixby, as a joint tenant with right of survivorship with Mr. Vogel, shares the power to vote and the power of disposition.
(6) Includes 2,966,312 shares for which Lee M. Vogel ("Mr. Vogel"), as a general partner of the JRB Partnership, shares the power of disposition. Of these shares, Mr. Vogel: (a) as a general partner of the JRB Partnership, in his individual capacity, has the sole power to vote 269 shares; and (b) as a co-trustee (with Richard L. Finn and C. John Malacarne) of the issue trust for Lee M. Vogel, a limited partner of the JRB Partnership, shares the power to vote 976,254 shares. Also includes: (a) 1,800 shares for which Mr. Vogel, as a joint tenant with right of survivorship with MM Bixby, shares the power to vote and the power of disposition; and (b) 5,298 shares which Mr. Vogel owns directly and has the sole power to vote and the sole power of disposition.
(b) Security Ownership of Management
As described in the notes to the table set forth below, certain named persons share the power of voting and disposition with respect to certain shares of Common Stock. Consequently, such shares are shown as being beneficially owned by more than one person.
Jack D. Hayes, Michael J. Ross and Elizabeth T. Solberg are currently Directors whose terms expire on April 19,2001. They, along with William R. Blessing and Cecil R. Miller, are nominees of management for election to three year terms at the annual meeting to be held April 19, 2001:
Served Shares of as a Record and Name and Principal Director Beneficially Percent Address Occupation Since Owned of Class
William R. Blessing Vice President Nominee 100 * 11708 Manor Sprint PCS Overland Park, KS Kansas City, MO
Jack D. Hayes Senior Vice Presi- 1995 500 * 3520 Broadway dent-Emeritus, 2,204(1) Kansas City, MO Marketing
Cecil R. Miller Retired Nominee 100 * 12215 Ash Overland Park, KS
Michael J. Ross Chairman of the 1972 600 * 12826 Dubon Lane Board, Jefferson St. Louis, MO Bank and Trust Company, St. Louis, MO
Elizabeth T. Solberg Regional President 1997 200 * 850 W. 52nd St. and Senior Partner, Kansas City, MO Fleishman-Hillard, Inc., St. Louis, MO
The following Directors were elected April 22, 1999 for a three year term:
Walter E. Bixby President, Old 1996 2,358,340(2)(3) 25.7 3520 Broadway American Insur- 365,276(4) Kansas City, MO ance Company, 6,506(1) Kansas City, MO 368,555(5)
Webb R. Gilmore Chairman, CEO 1990 500 * 833 Westover Rd. and Shareholder, Kansas City, MO Gilmore & Bell, Kansas City, MO
Nancy Bixby Hudson Investor 1996 2,966,312(6) 27.4 425 Baldwin Creek Rd. 331,566(7) Lander, WY
Daryl D. Jensen Vice Chairman of 1978 939 * 2143 Old Port Dr. the Board, Sunset Olympia, WA Life Insurance Company of America, Kansas City, MO
C. John Malacarne Vice President, 1991 20 24.2 3520 Broadway General Counsel 14,173(1) Kansas City, MO and Secretary 2,901,592(11)
Served Shares of as a Record and Name and Principal Director Beneficially Percent Address Occupation Since Owned of Class
The following Directors were elected April 20, 2000 for a three year term:
J. R. Bixby Chairman of the 1957 2,966,312(8) 24.6 3520 Broadway Board Kansas City, MO
R. Philip Bixby President, CEO 1985 2,358,340(2)(9) 25.8 3520 Broadway and Vice Chairman 15,777(1) Kansas City, MO of the Board 368,555(5) 362,602(10)
Richard L. Finn Senior Vice Presi- 1983 24 24.3 3520 Broadway dent, Finance 25,097(1) Kansas City, MO 2,901,592(11)
Warren J. Hunzicker, M.D. Director 1989 300 * 1248 Stratford Rd. Kansas City, MO
Larry Winn, Jr. Retired Represent- 1985 332 * 8420 Roe Ave. ative, U.S. Congress Prairie Village, KS
All Directors, executive officers and their spouses (also includes all shares held by trustees of Company benefit plans and shares held by the Bixby Family and related Trusts) 8,370,874 69.5
*Less than 1%.
(1) Approximate beneficial interest in shares held by the Trustees of Kansas City Life Insurance Company employee benefit plans. Participants have the power to vote the shares held in their account.
(2) As co-managing general partners of the WEB Interests, Ltd., a Texas limited partnership (the "WEB Partnership"), Walter E. Bixby, R.Philip Bixby and Angeline I. O'Connor, share the power to dispose of these shares, which are owned by the WEB Partnership. As co-managing general partners, in their capacity as co-trustees of the WEB Trust, Walter E. Bixby, R. Philip Bixby and Ms. O'Connor share the power to vote 2,140,578 of these shares.
(3) Includes (a) 215 shares for which Walter E. Bixby, as a general partner of the WEB Partnership, has the sole power to vote; and (b) 69,355 shares for which Walter E. Bixby, as the sole trustee of the Walter E. Bixby, III GST Trust and the Issue Trust for Walter E. Bixby, III, which trusts are limited partners of the WEB Partnership, has the sole power to vote.
(4) Includes (a) 350,830 shares which Walter E. Bixby owns directly and has the sole power to vote and the sole power of disposition; and (b) 14,446 shares for which Walter E. Bixby, as custodian for certain of his minor nieces and nephews, has the sole power to vote and the sole power of disposition.
(5) These shares are held in the Walter E. Bixby Descendants Trust. R. Philip Bixby, Walter E. Bixby and Ms. O'Connor are the co-trustees of this trust and share the power to vote and the power to dispose of these shares. The terms of the trust restrict the transfer of these shares.
(6) Ms. Hudson, as a general partner of JRB Interests, Ltd., a Texas limited partnership (the "JRB Partnership"), shares with the managing general partner and the other general partners of the JRB Partnership, the power of disposition of these shares, which are owned by the JRB Partnership. Ms. Hudson (a) as a general partner of the JRB Partnership, has sole power to vote 269 of these shares; and (b) as a co-trustee (with Richard L. Finn and C. John Malacarne) of the Nancy Bixby Hudson GST Trust and the Issue Trust for Nancy Bixby Hudson, which trusts are limited partners of the JRB Partnership, shares the power to vote 1,925,338 of these shares.
(7) Ms. Hudson, as sole trustee of the Nancy Bixby Hudson Trust dated December 11, 1997, has the sole power to vote and the sole power to dispose of these shares.
(8) J. R. Bixby, as sole managing general partner of the JRB Partnership, shares with the other general partners of the JRB Partnership the power of disposition of these shares, which are owned by the JRB Partnership. Of these shares, he has the sole power to vote (a) 335 of these shares as a limited partner of the JRB Partnership, and (b) 26,898 shares as a general partner of the JRB Partnership.
(9) Includes (a)215 shares for which R. Philip Bixby as a general partner of the WEB Partnership, has the sole power to vote; and (b) 69,355 shares for which R. Philip Bixby, as sole trustee of the R. Philip Bixby GST Trust and the Issue Trust for R. Philip Bixby, which trusts are limited partners of the WEB Partnership, has the sole power to vote.
(10) Includes: (a) 344,464 shares which R. Philip Bixby owns directly and has the sole power to vote and the sole power of disposition; and (b) 18,138 shares for which R. Philip Bixby, as custodian for certain of his minor nieces and nephews, has the sole power to vote and the sole power of disposition.
(11) Richard L. Finn and C. John Malacarne share the power to vote (a) 1,925,338 shares with Nancy Hudson, as co-trustees of the Nancy Bixby Hudson GST Trust and the Issue Trust for Nancy Bixby Hudson, which trusts are limited partners of the JRB Partnership; and (b)976,254 shares with Lee M. Vogel, as co-trustees of the Issue Trust for Lee M. Vogel, a limited partner of the JRB Partnership.
Item 13.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None.
PART IV
Item 14.
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a)(1) Financial Statements
The following financial statements of Kansas City Life Insurance Company are incorporated by reference from the Company's Annual Report to Shareholders for the year ended December 31, 2000 at the following pages:
Page
Consolidated Income Statement - Years ended December 31, 2000, 1999 and 1998 . . . . . . . . . . . . . . . 28 Consolidated Balance Sheet - December 31, 2000 and 1999 . . . . . . . . . . . . . . . . . . 29 Consolidated Statement of Stockholders' Equity - Years ended December 31, 2000, 1999 and 1998 . . . . . . . . . 30 Consolidated Statement of Cash Flows - Years ended December 31, 2000, 1999 and 1998 . . . . . . . . . 31 Notes to Consolidated Financial Statements . . . . . . . . . . . 32-42 Reports of Independent Auditors . . . . . . . . . . . . . . . . . 43
(a)(2) Supplementary Data and Financial Statement Schedules
Schedules are attached hereto at the following pages:
Page
I - Summary of Investments - Other than Investments in Related Parties, December 31, 2000 . . . . . . . . . 22 II - Condensed Financial Information of Registrant, Years ended December 31, 2000, 1999 and 1998 . . . . . . 23-25 III - Supplementary Insurance Information, Years ended December 31, 2000, 1999 and 1998 . . . . . . . . . . . . 26 IV - Reinsurance Information, Years ended December 31, 2000, 1999 and 1998 . . . . . . . . . . . . 27 V - Valuation and Qualifying Accounts, Years ended December 31, 2000, 1999 and 1998 . . . . . . . . . . . . 28
All other schedules are omitted as the required information is inapplicable or the information is presented in the financial statements or related notes.
(b) Reports on Form 8-K
None.
(c) Exhibits
Exhibit Number: Basic Documents:
3(a) Articles of Incorporation (as Restated in 1986 and Amended in 1999). [Filed as Exhibit 3(a) to the Company's 10-Q Report for the quarter ended September 30, 1999 and incor- porated herein by reference]
3(b) Bylaws as Amended October 26, 1986. [Filed as Exhibit 3(b) to the Company's 10-K Report for 1986 and incorporated herein by reference]
4(a) Specimen copy of Stock Certificate. [Filed as Exhibit 4(a) to the Company's 10-Q Report for the quarter ended September 30, 1999 and incorporated herein by reference]
10(a) Eighth Amendment, Kansas City Life Deferred Compensation Plan.
10(b)Twenty-third Amendment, Kansas City Life Insurance Company Savings and Profit Sharing Plan. [Filed as Exhibit 10(b) to the Company's 10-K Report for 1999 and incorporated herein by reference]
10(c)Eleventh Amendment, Kansas City Life Employee Stock Plan. [Filed as Exhibit 10(c) to the Company's 10-K Report for 1999 and incorporated herein by reference]
10(d)Second Amendment, Kansas City Life Excess Benefit Plan. [Filed as Exhibit 10(d) to the Company's 10-K Report for 1999 and incorporated herein by reference]
13 Annual Report to Shareholders for the year ended December 31, 2000.
21 Subsidiaries.
23(a) Independent Accountants Consent.
23(b) Consent of Independent Auditors.
23(c) Independent Accountants Consent.
23(d) Consent of Independent Auditors.
99(a)Form 11-K for the Kansas City Life Insurance Company Savings and Profit Sharing Plan for the year 2000 and filed as a part hereof and incorporated herein by reference.
99(b)Prospectus for Kansas City Life Insurance Company Savings and Investment Plan.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
KANSAS CITY LIFE INSURANCE COMPANY
By: /s/ John K. Koetting John K. Koetting Vice President and Controller (Principal Accounting Officer) Date: March 29, 2001
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Regis- trant and in the capacities and on the dates indicated.
By: /s/ R. Philip Bixby By: /s/ Richard L. Finn R. Philip Bixby Richard L. Finn Director; President, Chief Director; Senior Vice Executive Officer and Vice President, Finance Chairman of the Board (Principal Financial Officer) (Principal Executive Officer) Date: March 29, 2001 Date: March 29, 2001
By: /s/ J. R. Bixby By: /s/ C. John Malacarne J. R. Bixby C. John Malacarne Director; Chairman of Director; Vice President, the Board General Counsel and Secretary Date: March 29, 2001 Date: March 29, 2001
By: /s/ Walter E. Bixby By: /s/ Daryl D. Jensen Walter E. Bixby Daryl D. Jensen Director Director Date: March 29, 2001 Date: March 29, 2001
By: /s/ Jack D. Hayes By: /s/ Warren J. Hunzicker, M.D. Jack D. Hayes Warren J. Hunzicker, M.D. Director; Senior Vice Presi- Director dent-Emeritus, Marketing Date: March 29, 2001 Date: March 29, 2001
Schedule I
KANSAS CITY LIFE INSURANCE COMPANY AND SUBSIDIARIES SUMMARY OF INVESTMENTS - OTHER THAN INVESTMENTS IN RELATED PARTIES December 31, 2000
Amount at Which Shown Fair in Balance Type of Investment Cost Value Sheet
(in thousands)
Fixed maturity securities, available for sale: Bonds: United States government and government agencies and authorities $ 45,050 46,368 46,368 Mortgage-backed securities 381,224 384,311 384,311 Public utilities 290,415 281,832 281,832 All other bonds 1,280,885 1,220,901 1,220,901 Redeemable preferred stocks 745 745 745 Total 1,998,319 1,934,157 1,934,157
Equity securities, available for sale: Common stocks 37,966 37,851 37,851 Perpetual preferred stocks 62,900 56,418 56,418 Total 100,866 94,269 94,269
Fixed maturity securities, held to maturity: Bonds: United States government and government agencies and authorities 4,352 4,616 4,352 Public utilities 12,474 13,273 12,474 All other bonds 63,746 62,574 63,746 Total 80,572 80,463 80,572
Mortgage loans on real estate, net 396,731 396,731 Real estate, net 44,443 44,443 Real estate joint ventures 34,185 34,185 Policy loans 116,024 116,024 Short-term 54,171 54,171 Total investments $2,825,311 2,754,552
Schedule II
KANSAS CITY LIFE INSURANCE COMPANY CONDENSED FINANCIAL INFORMATION OF REGISTRANT BALANCE SHEET
December 31
2000 1999
(in thousands)
Assets Investments: Fixed maturity securities: Available for sale, at fair value $1,449,167 1,516,472 Held to maturity, at amortized cost 45,983 64,608 Equity securities available for sale, at fair value: Investments in affiliates 253,162 227,007 Other 70,170 89,376 Mortgage loans on real estate, net 300,752 262,380 Real estate, net 43,499 41,390 Real estate joint ventures 26,481 29,169 Policy loans 94,905 97,386 Short-term 8,761 12,956 Total investments 2,292,880 2,340,744
Deferred acquisition costs 125,259 116,696 Value of purchased insurance in force 59,124 63,429 Cash 17,347 18,537 Deferred income tax asset 21,685 14,717 Other 109,397 108,889 Separate account assets 325,148 259,899
Total assets $2,950,840 2,922,911
Liabilities and stockholders' equity Future policy benefits $ 528,702 541,126 Accumulated contract values 1,294,399 1,355,404 Other 270,337 272,677 Separate account liabilities 325,148 259,899 Total liabilities 2,418,586 2,429,106
Stockholders' equity: Common stock 23,121 23,121 Paid in capital 20,109 18,498 Accumulated other comprehensive loss (55,280) (59,095) Retained earnings including $151,380,000 undis- tributed earnings of affiliates ($136,800,000 - 1999) 651,324 614,278 Less treasury stock, at cost (107,020) (102,997) Total stockholders' equity 532,254 493,805
Total liabilities and stockholders' equity $2,950,840 2,922,911
The above condensed financial statement should be read in conjunction with the consolidated financial statements and notes thereto of Kansas City Life Insurance Company.
Schedule II (continued)
KANSAS CITY LIFE INSURANCE COMPANY CONDENSED FINANCIAL INFORMATION OF REGISTRANT INCOME STATEMENT
Years ended December 31
2000 1999 1998
(in thousands)
Revenues Insurance revenues: Premiums: Life insurance $ 25,481 30,684 31,899 Accident and health 42,567 40,524 37,963 Contract charges 83,841 82,065 82,273 Investment revenues: Investment income, net 155,759 159,027 156,501 Dividends from affiliates 100 0 100 Realized investment gains (losses), net (304) 1,208 9,198 Other 11,042 9,690 10,359 Total revenues 318,486 323,198 328,293 Benefits and expenses Policy benefits: Death benefits 63,073 60,372 58,929 Surrenders of life insurance 10,718 10,177 14,589 Other benefits 68,810 65,838 64,404 Increase in benefit and contract reserves 49,171 60,753 58,118 Amortization of deferred policy acquisition costs 11,437 12,443 16,861 Insurance operating expenses 80,234 79,230 75,543 Management fees from affiliates (12,234) (8,940) (5,923) Total benefits and expenses 271,209 279,873 282,521
Income before federal income taxes and equity in undistributed net income of affiliates 47,277 43,325 45,772
Federal income taxes 12,773 12,545 12,538
Income before equity in undistributed net income of affiliates 34,504 30,780 33,234
Equity in undistributed net income of affiliates 14,579 14,265 15,278
Net income $ 49,083 45,045 48,512
The above condensed financial statement should be read in conjunction with the consolidated financial statements and notes thereto of Kansas City Life Insurance Company.
Schedule II (continued)
KANSAS CITY LIFE INSURANCE COMPANY CONDENSED FINANCIAL STATEMENT OF REGISTRANT CASH FLOW STATEMENT
Years ended December 31
2000 1999 1998
(in thousands)
Net cash from operating activities $ 29,770 38,924 40,286
Investing Activities Investments called, matured or repaid 113,429 145,574 218,805 Decrease in short-term investments, net 4,294 23,279 9,968 Investments sold 319,786 382,401 364,541 Investments purchased or originated (362,818) (576,854) (620,514) Other 4,689 4,346 3,403 Acquisitions and dispositions of insur- ance blocks - net cash paid - (5,162) (13,250)
Net cash provided (used) in investing activities 79,380 (26,416) (37,047)
Financing Activities Proceeds from borrowings 34,700 89,950 - Repayment of borrowings (68,700) (25,950) - Policyowner contract deposits 97,345 105,018 126,743 Withdrawals of policyowner contract deposits (159,237) (148,515) (154,172) Cash dividends to stockholders (12,037) (11,841) (11,153) Other (2,411) (12,771) 962
Net cash from financing activities (110,340) (4,109) (37,620)
Increase (decrease) in cash (1,190) 8,399 (34,381) Cash at beginning of year 18,537 10,138 44,519
Cash at end of year $ 17,347 18,537 10,138
The above condensed financial statement should be read in conjunction with the consolidated financial statements and notes thereto of Kansas City Life Insurance Company.
Schedule III
KANSAS CITY LIFE INSURANCE COMPANY SUPPLEMENTARY INSURANCE INFORMATION
Future Policy Deferred Benefits, Contract Other Acquisition Values and Claim Unearned Policyholders' Costs Liabilities Premiums Funds (in thousands) December 31, 2000: KCL - Individual $125,259 1,833,620 319 131,958 KCL - Group - 10,935 25 - Sunset 48,040 373,006 99 9,508 Old American 71,661 257,696 367 7,273 Total $244,960 2,475,257 810 148,739
December 31, 1999: KCL - Individual $116,696 1,902,425 505 133,458 KCL - Group - 16,094 54 - Sunset 49,606 380,615 124 10,611 Old American 70,068 253,849 405 7,468 Total $236,370 2,552,983 1,088 151,537
December 31, 1998: KCL - Individual $102,850 1,939,018 330 120,781 KCL - Group - 19,070 55 - Sunset 47,240 380,134 17 10,966 Old American 68,867 249,729 413 5,197 Total $218,957 2,587,951 815 136,944
Insurance Accident and Policy Operating Health Written Benefits Expenses@ Premiums (in thousands) 2000: KCL - Individual $156,768 52,567 335 KCL - Group 35,004 20,950 43,710 Sunset 32,387 10,167 26 Old American 52,682 17,051 2,048 Total $276,841 100,735 46,119
1999: @Allocations KCL - Individual $162,336 53,507 362 of Insurance KCL - Group 34,804 20,872 41,411 Operating Sunset 30,242 10,867 27 Expenses are Old American 53,790 18,351 2,085 based on a Total $281,172 103,597 43,885 number of assumptions 1998: and esti- KCL - Individual $161,236 52,617 385 mates, and KCL - Group 34,801 20,289 38,820 the results Sunset 29,255 10,290 28 would change Old American 58,048 17,372 4,354 if different Total $283,340 100,568 43,587 methods were applied.
All other information required by this Schedule is shown in the accompanying Segment Information Note to the Consolidated Financial Statements.
Schedule IV
KANSAS CITY LIFE INSURANCE COMPANY REINSURANCE INFORMATION
Life Insurance Premiums Accident and Health Premiums 2000 1999 1998 2000 1999 1998 (in thousands) Direct KCL - Individual $ 24,951 29,725 26,836 379 413 440 KCL - Group 11,439 11,567 12,537 48,906 50,113 46,736 Sunset 5,606 5,491 5,656 28 29 31 Old American 78,912 81,022 83,555 5,456 6,168 6,815 Total $120,908 127,805 128,584 54,769 56,723 54,022
Ceded KCL - Individual (14,737) (13,811) (11,967) (44) (51) (55) KCL - Group (2,277) (2,333) (2,181) (6,674) (9,951) (9,158) Sunset (4,523) (5,879) (4,584) (2) (2) (3) Old American (6,281) (7,232) (8,016) (3,408) (4,083) (2,365) Total (27,818) (29,255) (26,748) (10,128) (14,087) (11,581)
Assumed KCL - Individual 6,105 5,536 6,674 - - - KCL - Group - - - - - - Sunset - - - - - - Old American - - - - - - Total 6,105 5,536 6,674 - - - Net $ 99,195 104,086 108,510 44,641 42,636 42,441
% of Assumed to Net 6 5 6 - - -
Life Insurance in Force 2000 1999 1998 (in millions) Direct KCL - Individual $ 14,003 13,386 12,569 KCL - Group 3,440 3,351 3,823 Sunset 5,629 5,807 5,768 Old American 1,048 1,072 1,101 Total 24,120 23,616 23,261
Ceded KCL - Individual (4,749) (3,726) (2,832) KCL - Group (267) (270) (256) Sunset (1,393) (1,371) (1,274) Old American (105) (116) (126) Total (6,514) (5,483) (4,488)
Assumed KCL - Individual 2,818 3,131 3,380 KCL - Group - - - Sunset - - - Old American - - - Total 2,818 3,131 3,380 Net $ 20,424 21,264 22,153
% of Assumed to Net 14 15 15
All other information required by this Schedule is shown in the accompanying Reinsurance Note to the Consolidated Financial Statements.
Schedule V
KANSAS CITY LIFE INSURANCE COMPANY VALUATION AND QUALIFYING ACCOUNTS
Years ended December 31
2000 1999 1998
(in thousands)
Real estate valuation account Beginning of year $ 1,519 2,877 3,686 Deductions (894) (1,358) (809) End of year $ 625 1,519 2,877
Mortgage loan valuation account Beginning of year $ 7,000 8,500 8,500 Deductions (2,970) (1,500) - End of year $ 4,030 7,000 8,500
Allowance for uncollectible accounts Beginning of year $ 1,555 1,337 1,209 Additions 218 491 449 Deductions (190) (273) (321) End of year $ 1,583 1,555 1,337
Exhibit 21, Form 10-K Kansas City Life Insurance Company
SUBSIDIARIES
Kansas City Life Insurance Company's significant insurance subsidiaries are:
1. Sunset Life Insurance Company of America, a corporation organized under the laws of the State of Washington and redomesticated to the State of Missouri.
2. Old American Insurance Company, a corporation organized under the laws of the State of Missouri.
The Company's non-insurance subsidiaries are not significant individually or in the aggregate.
Exhibit 99(a), Form 10-K Kansas City Life Insurance Company
SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549
FORM 11-K
[ ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] For the fiscal year ended December 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from __________ to ___________
Commission File Number 2-40764
A. Kansas City Life Insurance Company Savings and Profit Sharing Plan 3520 Broadway Kansas City, Missouri 64111-2565
B. Kansas City Life Insurance Company 3520 Broadway Kansas City, Missouri 64111-2565