Back to GetFilings.com
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [FEE REQUIRED] For the Fiscal Year ended December 31, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the Transition Period from to
Commission File Number 2-40764
KANSAS CITY LIFE INSURANCE COMPANY
(Exact Name of Registrant as Specified in its Charter)
Missouri 44-0308260
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
3520 Broadway, Kansas City, Missouri 64111-2565
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: 816-753-7000
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Name of Each Exchange on
Title of Each Class Which Registered
None None
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None
(Title of Class)
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]
Indicate by check mark whether the Registrant (1) has filed all reports
re-quired to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
As of March 15, 2001, 12,034,687 shares of the Company's capital stock par
value $1.25 were outstanding, and the aggregate market value of the common stock
(based upon the average bid and asked price according to Company records) of
Kansas City Life Insurance Company held by non-affiliates was approximately
$139,921,018.
Part II
Documents Incorporated by Reference
Item 5: Market for Registrant's Common Page 44 of Annual Report to
Equity and Related Stockholder Shareholders for the year
Matters. ended December 31, 2000.
Item 6: Selected Financial Data. Page 24 of Annual Report to
Shareholders for the year
ended December 31, 2000.
Item 7: Management's Discussion Pages 22 through 27 of Annual
and Analysis of Financial Report to Shareholders for
Condition and Results of the year ended December 31,
Operations. 2000.
Item 7A: Quantitative and Qualitative Pages 25 through 27 of Annual
Disclosures about Market Risk Report to Shareholders for
the year ended December 31,
2000.
Item 8: Financial Statements and Pages 28 through 43 of Annual
Supplementary Data. Report to Shareholders for the
year ended December 31, 2000.
Part IV
Index to Exhibits Page 20
PART I
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. 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. 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. 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. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
Incorporated by Reference.
Item 6. SELECTED FINANCIAL DATA
Incorporated by Reference.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION
Incorporated by Reference.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK
Incorporated by Reference.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Incorporated by Reference.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
Not Applicable.
PART III
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. 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. 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. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None.
PART IV
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