1012771--2/25/2008--FBL_FINANCIAL_GROUP

related topics

{loss, insurance, financial}

{regulation, government, change}

{capital, credit, financial}

{product, market, service}

{tax, income, asset}

{debt, indebtedness, cash}

{customer, product, revenue}

{condition, economic, financial}

{acquisition, growth, future}

{system, service, information}

Changing interest rates and market volatility, and general economic conditions, affect the risks and the returns on both our products and our investment portfolio. Our investment portfolio is subject to credit quality risks which may diminish the value of our invested assets and affect our profitability and reported book value per share. As a holding company, we depend on our subsidiaries for funds to meet our obligations, but our subsidiaries ability to make distributions to us is limited by law, and could be affected by risk-based capital computations. A significant ratings downgrade may have a material adverse effect on our business. Our earnings are influenced by our claims experience, which is difficult to estimate. If our future claims experience does not match our pricing assumptions or past results, our earnings could be materially adversely affected. Our ability to grow depends upon the continued availability of capital, which may not be available when we need it, or may only be available on unfavorable terms. Our ability to maintain competitive costs is dependent upon the level of new sales and persistency of existing business. Inaccuracies in assumptions regarding future persistency, mortality and interest rates used in calculating reserve, deferred policy acquisition expense and deferred sales inducement amounts and pricing our products could have a material adverse impact on our net income. Changes in federal tax laws may affect sales of our products and profitability. All segments of our business are highly regulated and these regulations or changes in them could affect our profitability. We face competition from companies having greater financial resources, more advanced technology systems, broader arrays of products, higher ratings and stronger financial performance, which may impair our ability to retain existing customers, attract new customers and maintain our profitability and financial strength. Success of our business depends in part on effective information technology systems and on continuing to develop and implement improvements. Our business is highly dependent on our relationships with Farm Bureau organizations and would be adversely affected if those relationships became impaired. We assumed a significant amount of closed block business through coinsurance agreements and have only a limited ability to manage this business. Our reinsurance program involves risks because we remain liable with respect to the liabilities ceded to reinsurers if the reinsurers fail to meet the obligations assumed by them. We experience volatility in net income due to accounting standards for derivatives.

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1012771--2/25/2008--FBL_FINANCIAL_GROUP_INC