Primerica Q3 Earnings Call Highlights

Key Points

• Primerica’s third-quarter results increased: Adjusted revenue rose 8% to $902 million, adjusted net operating income grew 2% to $209 million, and adjusted earnings per share climbed 7% to $6.77.
• Investment sales set a record, rising 19% year over year, with assets under management up 10% to $140 billion. The investment segment’s revenue increased 19% and pretax income rose 21%.
• Term life and recruiting remained weak: Issued policies fell 7% and recruiting declined 10%; Primerica expects full-year issued policies to drop 8% to 10% and its sales force to end 2026 about 3% smaller than at the end of 2025.

Primerica NYSE: PRI reported higher third-quarter adjusted revenue and earnings as record investment sales offset weaker term life production and a decline in recruiting.

Adjusted operating revenue rose 8% from a year earlier to $902 million, while adjusted net operating income increased 2% to $209 million. Diluted adjusted operating earnings per share rose 7% to $6.77. Chief Executive Officer Glenn Williams said the smaller increase in operating income reflected a lower actuarial remeasurement gain than in the prior-year quarter.

The company repurchased $122 million of common stock and paid $37 million in regular dividends during the quarter. Through the first nine months of 2026, it returned $511 million to shareholders through buybacks and dividends, Williams said.

Investment sales reach a record

Investment and Savings Product sales rose 19% year over year, marking another record quarter. Variable annuity sales grew 29%, managed account sales increased 27% and mutual fund sales rose 8%.

Assets under management ended the quarter at $140 billion, up 10% from a year earlier, supported by positive client flows and market performance. Net client flows were $407 million during the quarter.

The investment segment’s revenue increased 19% and pretax income rose 21%. Chief Financial Officer Tracy Tan said the business represented approximately 42% of consolidated revenue, compared with 38% a year earlier. Asset-based revenue grew 21%, outpacing the 14% increase in average client asset values, partly because of demand for products that generate higher recurring fees.

Primerica expects investment sales to increase by mid-single digits in the fourth quarter and by the mid-to-high teens for full-year 2026. Asked about the slower fourth-quarter forecast, Williams said there had been no significant change in business trends. He cited larger year-earlier comparisons and some caution after 12 consecutive quarters of double-digit sales growth.

Williams said older clients with larger accounts have shown interest in variable annuities’ income and account-value guarantees. Most annuity sales currently involve clients holding assets rather than moving immediately into distributions, he added.

Term life sales and recruiting decline

Issued term life face amount and estimated annualized premium each fell 5% from the prior-year quarter, while the number of issued policies declined 7%. Williams attributed the pressure to economic challenges facing middle-income customers and limited sales force growth.

Recruiting fell 10% year over year in the third quarter, and the number of people obtaining new life licenses declined 14%. The number of life-licensed representatives at quarter-end was down 3% from a year earlier. Primerica expects its sales force to end 2026 about 3% below its size at the end of 2025.

Williams said recruiting comparisons had been affected by the timing of incentives and that negative trends were expected to moderate further in the fourth quarter. He said the company plans additional growth incentives and field communications around its 50th anniversary in 2027, with a convention scheduled for July.

For term life, Primerica expects fourth-quarter issued policies to decline by low-single digits and full-year issued policies to fall 8% to 10%. Williams said the decline has moderated through the year, although improvement has taken longer than he anticipated. He said the company is helping clients fit coverage into their budgets and sees some stabilization in middle-income households’ cost of living.

Assumption review and expenses weigh on insurance results

Term life revenue was largely unchanged at $462 million, while adjusted direct premiums increased 3%. Segment pretax income fell 12% to $153 million, primarily because the quarter included a $9 million remeasurement gain, compared with $23 million a year earlier. Excluding those gains in both periods, pretax income declined 4%, Tan said.

Tan said the company’s annual actuarial review incorporated higher lapse rates and favorable mortality into its long-term assumptions. She attributed higher lapses in part to the runoff of policies generated during the pandemic and economic pressure on middle-income families. Some recent policy durations have shown improvement in the past couple of quarters, she said, but the timing of a broader recovery is difficult to predict.

Consolidated insurance and other operating expenses rose 9% to $165 million, driven primarily by investment-business growth costs and technology spending. Primerica expects expenses to increase about 10% year over year in the fourth quarter and 7% to 8% for the full year, unchanged from its prior outlook.

Tan said the holding company ended the quarter with $600 million in cash and available-for-sale securities, while Primerica Life’s estimated risk-based capital ratio was 445%. She said the company maintains a strong capital position to support growth, technology investment and potential market uncertainty.

About Primerica (NYSE:PRI)

Primerica, Inc is a financial services company that focuses on serving middle-income households in the United States and Canada, as well as families in Puerto Rico. The company distributes its products and services through a network of independent representatives who provide financial education and help clients address protection, savings and investment needs.

Primerica's principal offerings include term life insurance, investment and savings products, retirement planning solutions, and strategies for managing debt.

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