“Everyone then who hears these words of mine and does them will be like a wise man who built his house on the rock. And the rain fell, and the floods came, and the winds blew and beat on that house, but it did not fall, because it had been founded on the rock.
And everyone who hears these words of mine and does not do them will be like a foolish man who built his house on the sand. And the rain fell, and the floods came, and the winds blew and beat against that house, and it fell, and great was the fall of it.”
The parables of Jesus are simple stories containing timeless truths. The parable of the house built on the rock is such a story. It is very simple, just four verses, but it holds tremendous truth.
These words of Jesus perfectly demonstrate the importance of having a solid foundation – personally and professionally! And that’s exactly what Funeral Directors Life has – a solid foundation. Our company operates based on the principles that Jesus teaches us, and His principles are solid, sound, unwavering, firm, and unmoving. They are truth.
Matthew 7:24-27
As we look back on the success of our company in 2023, it’s important to consider three questions concerning our business in relation to the house built on the rock:
• What did we do to fortify our foundation during 2023?
• What was done to further prepare our house for the “bad weather” to come?
• What was our assessment of the foundation and the structure of our “house” after going through the storms of 2023?
To build a house “on the rock,” it would have been difficult to chip into the rock and level it off to build the house. It would have taken time, patience, and hard work. But the wise man seems to have considered these factors and believed it would be worth the effort.
From year to year, weathering storm after storm, any foundation would need to be fortified. As we consider FDL, let’s look at some things we did in 2023 to strengthen and fortify our foundation:
• We implemented a company retirement program to honor those to whom honor is due.
• We brought best-selling author John O’Leary to four state conventions to present a keynote address on how funeral directors can overcome stress and potential burnout.
• We established an endowed scholarship with the Funeral Service Foundation, the charitable arm of the National Funeral Directors Association (NFDA).
• We created the “Spirit of Kokua” program. The Hawaiian word “Kokua” means to give to others without expecting anything in return; we inspired 2023 incentive trip attendees to gift $100 to honor the citizens of Maui.
• We launched our very first “DIG Week,” during which our employees were encouraged to serve others.
• We improved mortuary schools and student engagement, so 1 in 3 students now have free access to Passare.
• We began website management services in association with Tukios to help our funeral home clients have more effective websites.
• We automated over 6,000 hours of processing time (2.41 years) and over 100,000 tasks using robotic process automation (RPA), and we received the first Hyland Customer Innovation Award from Hyland Solutions for the use of RPA.
• We were featured in Datos Insights’ Insurance Technology Impact Awards Case for our new DIGiscanner technology that enables sales professionals to effortlessly scan and upload documents to the Home Office, with automated document recognition, cropping, and quality adjustments for seamless processing.
• We elevated security awareness and made strides toward becoming a culture of security through gamification by developing a competition called Phish Bytes to help our people fully understand the need to be consistently aware of phishing emails.
• We advanced our network security posture via security solutions: network access control, mobile device management, and endpoint detection and response.
• We fully customized our Digital Security Plan.
• We implemented an emergency notification system for various emergency purposes/responses, such as active shooter, tornado, fire, etc.
The parable is very clear: “… And the rain fell, and the floods came, and the winds blew and beat on that house….” Storms hit both the house built on the rock and the house built on the sand, but the house built on the rock withstood the storms. This means that those of us who follow the principles of Jesus will also have rain and wind and floods, so we must be prepared to face them.
Here are some things that we did at FDL to further prepare ourselves for approaching storms – problems, challenges, issues, etc.
• We launched two new services in Directors Business Solutions (DBS):
• DBS Accounts Payable Automation – Bill pay services for funeral homes that offer our clients an app-based solution and fully automate the way they pay bills.
• DBS InSights Reporting –Insightful reports that include key performance indicators that leverage the power of Passare to deliver well-structured data to funeral professionals.
Jamilah Spears Organizational Development Partner
• DBS formed a new partnership with SurePayroll, which has increased our efficiency in all facets of funeral home payroll.
• We successfully transitioned from the Human Resources Department to the People Operations Department and the Compensation and Benefits Department.
• We successfully transitioned to Gallagher for employee health insurance and elective benefits.
• We rolled out a new paid time off policy for all employees.
• We converted over $5 million in preneed funeral trust funds to FDL insurance and annuities.
• We rolled out the “Wolfelt Experience 101” to our Home Office staff and funeral professionals nationwide.
• We hosted two Wisconsin Burial Agreement Continuing Education classes.
• We identified, tested, and chose a more robust learning management system - Docebo.
• We increased the growth rate on our products by 25 basis points on January 1st and another 50 basis points on October 1st – two increases in one year, which is a first for FDL!
• We modified our insurance administration system (GIAS) to handle current and future growth rate changes.
• We adjusted the treatment of deferred acquisition costs (DAC) to reduce the effects of DAC on our federal income tax return.
• We completely renovated the Marketing office space.
• The 2023 National Funeral Directors Association (NFDA) Convention ran like clockwork and became an offensive weapon for our company.
• We launched the at-need Arrangement Guide to help facilitate online arrangements for our funeral home clients to better serve their customers through a digital experience.
• Our Operations Department became fully staffed for the first time in 5 years; due to the growth of the company and to training people in Operations to fulfill other needs within the company, we’re proud to now have a 100% staffing level!
• We processed a record number of contracts – 95,000!
• We grew our Customer Ambassador team to continue to provide industryleading service, which is one-of-a-kind in our profession.
• We refined our check-by-phone process to automate and make all payments digital, resulting in a 70% reduction in returned payments.
• We automated Texas claims, cancels, and rewrites.
• We began running weekly and monthly production reports out of Power BI, saving the team hours of time each week.
• We developed 12 new dashboards in Power BI for Sales Management reporting.
What was our assessment of the foundation and the structure of our “house” after going through the storms of 2023?
Once a house has gone through a storm, it’s important to assess not only the damage to the structure, if any, but also assess what came through the storm effectively.
Based on our assessment, our “house” (FDL) weathered the storms pretty well in 2023:
• We achieved a $213 million increase in assets during 2023 – total assets are now more than $2 billion!
• The average yield on FDL’s bond portfolio increased by 23 basis points (.23%), which is a $4.5 million positive impact on investment income.
• We achieved a record-setting $63 million in new funeral home loan originations.
• We successfully completed four state department of insurance examinations.
• Claimcheck achieved a return on investment of more than 16%!
• Digital Marketing Services achieved record revenue of over $2.5 million and record net profit of more than $500,000!
• We achieved a record number of leads generated from Facebook – over 24,000!
• The Inside Sales team signed over 300 new funeral home customers for new annual sales contracts totaling $2.5 million. DIGicare services achieved $950,000 in new annual sales contracts with 140 new funeral home accounts.
• The overall marketing partner segment finished 2023 with over $200 million in sales (up 23% over 2022).
• We achieved record annual sales volume of $521.7 million for 2023!
• We achieved record monthly sales volume of $49.96 million in October!
• Our Select Producer program achieved record annual sales volume of $77 million!
• Our online, preneed funeral arrangement program, Arrangement Guide, achieved record annual sales of more than $2 million!
In the parable of the house built on the rock, Jesus said, “And the rain fell, and the floods came, and the winds blew and beat on that house, but it did not fall, because it had been founded on the rock.”
We have made the conscious decision to run our business based on the rock – the principles of Jesus. And due to his mercy and grace, we have weathered all the storms that have come our way. 2023 was an extraordinary year, and the credit goes to “THE ROCK!” To Him be the glory!
As I have said many times before, I am blessed with an incredible team of people who work here with me at Funeral Directors Life. Their commitment to Christian principles, dedication to our company, and collective wisdom and discernment have pushed me to become a better leader and made our company the envy of all other companies in our profession!
Toward the end of 2023, we had two distinguished members of our Board of Directors make the decision to retire – Jerry Edwards and Allan Adams. Our company has been blessed to have both of these funeral professionals serve and advise us for more than 30 years; they helped us build our house on the ROCK! Their legacy will live on here at Funeral Directors Life for decades to come. It is with much love that we extend our appreciation to them for all they have done for us.
Finally, we continue to appreciate the confidence you have shown in our company – thank you! All of us at Funeral Directors Life remain committed to you and to our vision – To be the best, mostrespected provider of service to the funeral profession!
Blessings,
Kris Seale President and Chief Executive Officer
What does it mean to build something that lasts?
Whether we're constructing homes or building relationships, our people give 100% to every task.
You might think immediately about the Great Wall of China, the Pyramids of Giza, or even the Old City of Jerusalem. While they’re magnificent structures, these modern marvels aren’t the only things that can be built to stand the test of time.
People build intangible things, too.
We build community.
We grow in knowledge.
We deepen relationships with each other and God.
The list goes on.
The truth is, we all have the power to create, build, and shape our world however we see fit. And in 2023, Funeral Directors Life took building seriously, especially in relation to our “more than a preneed company” philosophy.
First, our company continued to grow! We expanded various departments in our Home Office, grew our sales team, and hired new team members in various roles. Additionally, we developed new technology and products to serve our profession, from updates to our preneed mobile app to new digital marketing options for funeral homes. We also continued to build relationships with clients and other companies, aligning ourselves with likeminded, service-oriented people.
We did all of this while keeping Christ at the center of it all. He is our firm foundation. Without Him guiding us and reminding us to lead with love, we may have had an entirely different year!
Kris shared Matthew 7:24-27 in his Letter to the Stakeholders, reminding us how important it is to build a foundation on the rock of Christ. Verse 25 is especially significant:
“And the rain fell, and the floods came, and the winds blew and beat on that house, but it did not fall, because it had been founded on the rock.”
Because we built our company on Christian principles, we know we can weather any storm.
The rain can fall. The winds can blow. Trials, adversities, and challenges can test us.
But with Christ as the foundation, we’re built to last.
And we will not fall.
Our Accounting Department knows how to do more than crunch numbers. They also like to show off their fun and tropical side!
“How good and pleasant it is when God’s people live together in unity!”
The main reason why our company has been around for over four decades is our people. It’s easy to build community with people who are caring, fun, and love being at work! Here are the ways we built community in 2023.
When you love who you work with, work doesn’t feel like work! This is especially true when we can participate in special events to honor our co-workers and friends and build camaraderie through exercise.
First, we’re all blessed to work for a company that makes time for fun, such as allowing us to compete in a salsa contest during work hours and dress up for themed days, including Hawaiian Shirt Day, Rangers Day (to celebrate their World Series win), and Halloween, which led to some creative costumes. And our employee appreciation day (DIG Day) became DIG Week in 2023!
Blessing expecting mothers, birthdays, and marriages is also built into our culture here! Last year, we had many baby showers, birthday celebrations, and wedding parties in our work café. Co-workers decorated, celebrated, and spent time honoring their friends.
We also competed in the Abilene Corporate Olympics, an event where working adults participate in various challenges and sports to take home the title of Corporate Olympics Champion. 2022 was the inaugural year, and we took first place! In 2023, our teams competed in basketball, golf, pickleball, cornhole, and other events. We won the Large Corporate Division award and took first place overall once again!
Employees also handed out Performance Plus Awards during company luncheons to highlight co-workers’ accomplishments. Employees gave $50 to two employees or $100 to one person. In 2023, we gave away $8,850! We’re grateful to Kris for allowing us to recognize each other in this way.
Denise Chabarria, Director of People Operations (left), and Kassidy Payne, Client Success Manager
We thought 2022 was an incredible year of growth, but our staff grew to about 500 employees by the end of 2023. It’s a striking number, especially considering our company only had a handful of employees in 1981!
In 2022, we created our Corporate Culture Department to ensure our employees felt connected to each other amidst the change and had a way to stay informed about goings-on in the company. And in 2023, we successfully transitioned from the Human Resources Department to our new People Operations Department and Compensation and Benefits Department!
“We’ve had tremendous growth in developing our staff in the last couple of years! We have smart, talented, and caring people who enhance our culture and take care of one another as well as our customers.”Sonia DeLeon Director of Employee Relations
Last year, our parent company, Directors Investment Group (DIG), was honored with multiple workplace awards from organizations across the nation.
• Top 200 U.S. Life/Health Insurers in 2023 — published in Best’s Reviews (AM Best)
• #31 in Fortune Best Workplaces in Financial Services & Insurance™ 2023 (Small and Medium)
• #19 in Fortune Best Workplaces in Texas™ 2023 (Small and Medium)
• Recertification as a “Great Place to Work” by Great Place To Work®
To say we were honored to be featured on these lists next to so many other incredible
“Give to everyone what you owe them…if respect, then respect; if honor, then honor.” Romans 13:7
We’ve been blessed to have so many talented individuals work for our company over the years. In 2023, we said farewell to several employees as they began a new adventure…retirement!
Rex Miley, Terri Bannister, Steve Jenkins, Lori Owen, Royce Rampy, Sherri Miller, Annette Parmelly, Sunshine Andersland, and Vickie Gillespie, we wish you well!
We’re forever grateful for your dedication to your work, the service you provided, and your friendship.
If we learned nothing else in 2023, we learned that iron sharpens iron. We’re grateful to have so many cherished memories to look back on last year!
“Commit to the Lord whatever you do, and he will establish your plans.”
Our staff is always ready to serve and eager to innovate in order to bring the best products to our profession.
Proverbs 16:3
Not only did we invest in the growth of community last year, but we also devoted time to improving the profession we’re honored to serve. Here are a few ways we built up the funeral profession in 2023.
Early on in the year, we decided to offer our Virtual Wolfelt Experience™ training to all funeral professionals, not just our clients. This training, created in partnership with Dr. Alan Wolfelt, has been called “life-changing,” “career-changing,” and “transformational” by participants, and we were proud to roll it out nationwide to push our profession forward.
Another way we continued to invest in our profession was by leading the charge of increasing growth rates for our preneed products — not once, but twice! Our clients were excited to experience a total increase of 75 basis points for new business.
We also made adjustments to our preneed mobile app, which included new biometric authentication login options and document scanning technology to save users time on finding a scanner to upload documents. The document scanner was featured in Datos Insights’ Insurance Technology Impact Awards Case Study. This recognition was a testament to our team’s hard work and dedication!
Our company was also named a winner of the first Hyland Customer Innovation Award at Hyland’s annual conference. Hyland, a leading global content services provider, announced that FDL won the “Most Transformative Solution” category for implementing Hyland robotic processing automation into our company processes. With it, we’ve saved thousands of hours by removing tedious, manual tasks, allowing us to provide the best service to our valued customers.
Though FDL began as a preneed insurance company, our growth over the years has demonstrated we’re invested in more than preneed. Our teams are dedicated to improving technology, insurance assignment processing, marketing and more.
At the 2023 NFDA International Convention & Expo, we debuted our new digital marketing packages for funeral homes. These packages include a range of digital marketing options, including social media management, Google and YouTube ads, custom video production, preneed eCommerce, aftercare, and a brand-new website management service created in partnership with Tukios. With a digital marketing package, funeral homes can increase brand awareness, generate preneed leads, boost their Google ranking, stream ads on various platforms, and manage their website professionally, all with one marketing service. In the first four months, we brought on 24 new clients!
Kyle Swearingen, VP of Development (left), Patrick Walker, Lead RPA Engineer (center), and Kyler Gayle, RPA Developer
Throughout 2023, our brand marketing team worked hard to create new eBooks, blogs, podcast episodes, and other content for funeral professionals, and everything was well received!
Here are some content milestones that happened:
1,633
60,319 downloads and views on our FD Talks podcast eBook downloads blog views across 152 articles between FDL and Passare
10,000
At the NFDA International Convention & Expo, we presented a $102,500 donation to the Funeral Service Foundation, our third major gift to the foundation. We were honored to support the scholarship program in its mission to serve the next generation of funeral professionals.
Kris Seale shared a powerful speech about funeral service being a ministry. He said:
“Nehemiah 6:3 says, ‘I am doing a great work, and I cannot come down.’
Nehemiah was inspired by God to rebuild the wall around the city of Jerusalem. He didn’t let opposition or tragedy get to him; he simply wanted to complete the job. When I thought about that, I thought about funeral service and what you all do every day. Tragedy occurs in your community, and you step up to take care of families. We hope to support the younger generation so they see funeral service as a ministry and a calling in the same way you do.”
Attending conventions is always one of our favorite ways to visit with old friends and make new connections!
“Therefore, encourage one another and build one another up, just as you are doing.”
1 Thessalonians 5:11
God calls us to be the light of the world, and that mission is one we strive to accomplish wherever we go. Whether we were hosting guests in our Home Office or attending conventions around the nation, we made sure to build lasting relationships last year.
We love bringing funeral professionals to Abilene because they get to see firsthand what makes our company so great…our people! In 2023, we planned and hosted around two dozen trips for funeral professionals and marketing partners around the country. We flew them out, gave tours of our facilities, and shared all the ways we help funeral homes serve families better. In 2024, we hope to bring even more people to our great state of Texas!
At our company, we value leaders and teaching them skills to grow personally and professionally. That’s why we have many opportunities for people to grow, including through our Emerging Leaders Program. In 2023, we had 10 employees graduate from this program, with many moving into leadership roles in the company!
We also invest in college students to help them gain real-world experience before they graduate. Last year, we had nearly 30 interns and apprentices shadow and work in various departments around the company. Some even landed full-time positions with us!
Throughout the year, our talented sales managers headed out to various state conventions to represent our company and share the benefits of partnering with our family of companies. Everyone was in high spirits as they connected with old friends and made new ones.
We even sponsored John O’Leary, best-selling author and speaker, at a few conventions to share a powerful, uplifting keynote presentation. People who saw his presentation told a few of our representatives that his message was exactly what they needed to hear.
State conventions were one of our favorite ways to build new relationships last year, and we look forward to making our presence known across expo halls in 2024!
In September, Funeral Directors Life and Passare team members headed to the great city of Las Vegas for the NFDA International Convention & Expo. The team set up the Funeral Directors Life and Passare booths, met with customers and prospects, and had meaningful conversations about connecting with funeral consumers.
The team also handed out some unique freebies, including steak rubs and socks! Executive Vice President and Chief Marketing Officer Drew Seale met with Sepio Guard CEO Chris Johnson to collaborate on a co-branded sock to give away at the booth. All of this marketing led prospective clients to recognize our brands during convention. The NFDA Convention has become our most successful networking and lead-generating event!
“We all had an incredible time building relationships and connecting with funeral professionals. We’re looking forward to doing it again next year!”
Drew Seale EVP, Chief Marketing Officer
We're so grateful for our sales leadership team and all they do to represent and grow our company.
Another way we built new connections and improved our profession in 2023 was by working with like-minded companies and organizations. This looked like:
• Raising money for grief efforts with Healing Hearts Connection by jumping into a frozen lake!
• Partnering with companies on new services — including our new website management service, which uses Tukios’s website technology.
• Inviting Gary Freytag, President and CEO of Spring Grove Cemetery and Arboretum and ICCFA president at the time, to the FD Talks podcast to share leadership lessons with our audience.
• Growing the marketing partner segment of our business and helping our partners serve more families than ever in 2023.
“As iron sharpens iron, so one person sharpens another.”
When strong leaders in our profession come together, everyone benefits! Overall, 2023 was another year of meeting new people and deepening relationships with other industry professionals and our own team members. We look forward to making new friends in 2024 and sharing God’s love and Christian principles along the way!
Our people are always looking for ways to go above and beyond for great organizations, even if that means jumping into a frozen lake! The Frunge has become a popular way for us to support Healing Hearts Connection as a company.
During our first ever DIG Week, our people embraced the Abilene heat and worked tirelessly to frame a home for a local family in need. What a blessing it was to serve our community!
“Give, and it will be given to you. A good measure, pressed down, shaken together, and running over, will be poured into your lap. For with the measure you use, it will be measured to you.”
Luke 6:38
When people think of our company, we want them to think of one quality in particular: helpers of people. Whether we’re serving our community or each other, that mission is always top of mind and ready to be carried out by our people. Through our volunteer efforts, we built the kingdom of God.
In July, a dedicated team of 31 volunteers embarked on an extraordinary, week-long journey to Costa Rica. Their objective was clear: to create lasting, meaningful change by providing two deserving families with brand-new homes. These weren’t just any homes; they were sturdy structures built from the ground up with robust concrete foundations.
Our volunteers didn’t just show up; they poured their hearts and souls into the project.
Their unwavering dedication successfully altered the course of these two families’ lives. By building these homes, they breathed hope and dignity into the lives of these families, giving them a place they can truly call their own. It’s a testament to the power of collaboration and compassion. To God be the Glory!
Kris Seale approached Jeff Stewart, Executive Vice President and Chief Culture Officer, early in 2023 with a unique and ambitious idea: What if our employees did a service project during DIG Week?
Jeff reached out to Krista Masci, a DIG employee and member of the Habitat for Humanity Abilene Board of Directors, to discuss if a service project would be possible with Habitat for Humanity. It was!
Over 230 employees and summer apprentices volunteered to frame a house for the deserving Goana family. After the build, volunteers were asked to describe their experience in one word. The most popular word was JOY.
“My hope for DIG Week is that our employees take our culture and look for ways to share that with people in their daily lives. We want helpers of people to be our legacy.”
Jeff Stewart EVP, Chief Culture Officer
Overall, we saw how a pile of lumber transformed into an unshakeable structure. It was a reminder of how God can take all our parts – large and small – and build us into something extraordinary.
In 2023, our employees were able to apply to take a month-long, paid Sabbatical in 2024 to focus on rest, restoring broken relationships, serving others, and more. The Corporate Culture Department worked diligently to set up the application process to ensure everyone could participate if they chose to. Initially, the Sabbatical was available to employees who were hired in the first half of the year. But shortly before Christmas, Kris decided to bless all full-time employees who were hired in 2023 with the opportunity!
Over 280 employees will take a short Sabbatical in 2024, but the work won’t cease! We will continue to do a great work. And we will not come down!
To celebrate another exciting year of growth and success, our employees participated in the annual end-of-year event at Beltway Park Church. The theme was “Love Well. Work Well. Rest Well.” We learned the importance of focusing on all three areas to find personal and professional balance. Also, we heard from Beltway Park Church pastor Geoffrey Turner and employees who shared their past Sabbatical experiences.
Overall, the 2023 end-of-year year event proved to be educational, insightful, and reflective!
Besides building homes and strengthening our reliance on God, we also served our community in other ways.
152
gifts were collected and donated to seniors during the holidays
$8,520
2 tons was raised through the Giving Tree
of food were donated during our Mission Thanksgiving drive
$2,632
was raised through a bake sale to benefit Pregnancy Resources of Abilene
Employees also contributed to other organizations throughout the year, including the Abilene Youth Sports Authority, Alzheimer’s Association, Cancer Services Network, Healing Hearts Connection, and more.
In 2024, we hope to further build up God’s kingdom by sharing His love and serving others!
While our company has grown throughout the years, we still operate on the principles and nonnegotiables we were founded on.
“Do nothing out of selfish ambition or vain conceit. Rather, in humility value others above yourselves, not looking to your own interests but each of you to the interests of the others.”
To build a legacy, one must have a strong commitment to serve, grow, and give back to others. It’s apparent that our people loved each other, our profession, our customers, and our community in 2023. As a result, we had monumental growth.
Our company wouldn’t be where it is today without dedicated, humble, and smart leaders at the helm. We continuously reinvest in our people, from first-time supervisors to executive management, and provide ways for them to grow professionally.
Every year, vice presidents and executives gather to set intentional goals for our company. At these meetings, they focus on professional and personal growth, discuss strategies for improving communication across our departments, and focus on company improvements. We asked them:
“Craig Groeschel said, ‘If you aren’t failing now and then, you’re playing it way too safe…Find comfort in being uncomfortable. Growth and comfort never coexist.’ I heard this at our VP retreat, and it was my big takeaway!"
Amy Biggs VP of Operations
“Pat Lencioni’s book, The 6 Types of Working Genius, resonated with me. It draws from 1 Corinthians 12:4-6, which is a powerful reminder that God endows us with our uniqueness.”
“As leaders, our words are powerful because they can inspire or deflate. I choose to encourage others by speaking words that positively impact someone else.”
Groban EVP, Chief Financial Officer
“Leaders are called to lead like Christ and to understand that leadership isn’t meant to be a level of superiority but rather a place of servanthood.”
Melissa Magers VP of Accounting
“Leaders who don’t listen will eventually be surrounded by people who have nothing to say.”
Dwayne McGraw EVP, Chief Actuary
Behind every successful company is a hard-working team. And we’re blessed to have the best of the best! 2023 was a year of continuing to break sales records.
Here are a few records that were broken:
We firmly believe our faith in God paved the way for our success and allowed our teams to achieve more than we ever thought possible. Here's a few records that were broken:
$2 million
$2.5 million
$77 million
$49.96 million $521.7 million
in new funeral home loan originations
$63 million sales on Arrangement Guide in Select Producer sales generated in a single month in annual sales volume in DIGicare revenue in sales for our marketing partner segment
$200 million
A legacy has to start somewhere. For Funeral Directors Life, it began in 1977.
That year, Bill Seale, Tom Branon, Ernest Welch, and Melvin Storm formed a partnership and founded the company Tembico, Inc. (based on the initials of their first names). They began to talk seriously about forming an insurance company that could provide preneed products for their respective funeral homes.
Four years later, Funeral Directors Life was founded.
Bill, Tom, Ernest, and Melvin continued to grow and invest in FDL and affiliated companies. They expanded their workforce and hired sales managers, preneed insurance representatives, and in-house employees, including Kris Seale in 1985.
Funeral Directors Life held $2.5 million in assets at the end of 1985. Nearly 40 years later, total assets exceed $2 billion. Not bad for a small company founded by four funeral directors in Brady, TX!
In 2023, the Corporate Culture Department worked on a unique project to commemorate their hard work: a Legacy Wall. Every time employees enter or exit our east hallway, they see a slideshow of images and memories created during the early days of FDL. We never want to forget our roots.
Because without the leadership, tenacity, and servant hearts of our founders and early employees, we wouldn’t be where we are today.
“For everyone who exalts himself will be humbled, and he who humbles himself will be exalted.”
Luke 14:11
Kris presents a special Performance Plus Award to Robby Bates (left), Funeral Director and Owner of Bates Family Funeral Home, and Betty Bates.
Funeral Directors Life started out as a humble group of individuals with one goal: to help funeral professionals. A lot has changed over the years, but our mission never has. And it never will.
Family and relationships have always been important to us at Funeral Directors Life. We are so thankful for our loved ones' support in trying to make the funeral profession a great place.
“And the rain fell, and the floods came, and the winds blew and beat on that house, but it did not fall, because it had been founded on the rock.”
For Funeral Directors Life, it looks like:
Having a supportive team that looks out for each other.
Investing in a profession we care about.
Making new connections with servant-hearted people.
Helping others while being a light in a dark world.
Remembering where our story began and determining where it will go.
And lastly, it means to keep Christ at the center of everything.
In 2023, we were able to withstand trials and celebrate victories because He was our rock.
With Him, our company is built to last.
December 31, 2023
For 2023, the financial position of Funeral Directors Life Insurance Company (FDL) remained strong as the Company maintained an AM Best Insurance Company Rating of A- (Excellent) with a stable outlook. The significant increase in yearover-year new business sales production along with the company’s consistent investment strategy resulted in combined premium and investment income of $553.4 million – a $63.5 million increase over 2022. While policyholder benefits were in line with projections, they exceeded 2022 by $41.1 million or 10.85%. Commissions and general insurance expenses increased by 20.89% – a result of increased new business sales and the company’s continued investment in infrastructure for future growth. Net income fell short of 2022 by $2.4 million due largely to lower realized capital gains. Total assets increased by $213.3 million, while capital and surplus increased by $8.2 million, resulting in a strong ratio of capital and surplus to assets of 8.23%, despite the significant growth in new business.
On September 15, 2022, FDL purchased 100% of FPA, Inc., an Arkansas corporation, for $7.4 million under the Statutory Purchase Method. FPA, Inc.’s only asset is its ownership in American Life and Annuity Company (ALAC), a preneed life insurance company domiciled in the State of Arkansas.
No other material transactions occurred outside the normal scope of business during 2023.
The Total Assets of FDL grew to $2.1 billion, an increase of $213.3 million or 11.24% from year-end 2022. As of December 31, 2023, FDL’s assets were distributed as follows: 98.36% in investments, .95% in investment income due and accrued, .24% in deferred tax assets, .23% in receivables due from insurance companies, .09% in premiums deferred and uncollected, and .13% in various other assets.
Invested Assets: For 2023, the primary investment held by FDL was bonds (government, agency, and corporate) representing 83.65% of invested assets or $1.73 billion. The emphasis regarding the investment portfolio has consistently involved purchasing investments that provide sufficient cashflow for the products sold, while maximizing book yield, limiting risk, and maintaining appropriate liquidity.
Throughout 2023, FDL maintained this approach by matching the expected cash flows of the investment portfolio to projected liabilities, known as an Asset Liability Management (ALM) strategy. This conservative approach to managing assets has been consistent since 1993 and was designed to reduce risk and provide assurance that the cash flow of assets is appropriate to provide for the claims of the company.
The growth in company assets has allowed FDL to “average into the market” over many different interest rate environments and in all areas of the yield curve. In combination with a disciplined approach to investing, this has helped protect FDL’s investment portfolio against market value volatility due to interest rate fluctuations. During the year, FDL increased the diversification of its portfolio by both asset class and number of issues. Therefore, risk related to individual securities and single asset sectors has been reduced. Treasury yields were volatile throughout 2023 as the Fed continues to combat persistent
inflation. The treasury curve ended the year inverted, where shorter duration yields exceeded longer duration securities with the highest yielding treasury being the 2-month treasury bill at 5.4%. FDL invested throughout the year over various parts of the curve but focused on shorter duration cashflows to increase liquidity while also seeking the best value in the market. Despite the volatility and economic concerns, FDL has continued to follow the long-term investment strategy and focus on diversification in terms of capital and surplus, asset valuation reserve, and the company’s asset liability matching strategy. Additionally, the company continues to look for ways to maximize book yield, while positioning the invested assets in a manner that is prudent for policyholders while maximizing the risk/return tradeoff.
At year-end 2023, FDL’s portfolio contained one thousand one hundred seventy (1170) different bond issues with an overall portfolio average rating of NAIC 1 and 2, and only eighty-six (86) issues rated below NAIC 2, representing 6.7% of total bonds. Additionally, over 75% of the securities rated below NAIC 2 carry at least one investment grade rating from either Moody’s, S&P, or Fitch at year-end. As of December 31, 2023, FDL’s allocation of industrial and miscellaneous bonds maintained the greatest allocation at 91.41% of total bonds, followed by special revenue and assessment bonds (6.46%), U.S. political subdivisions (1.34%), U.S. Government bonds (0.56%), and U.S. States (.23%). The overall portfolio duration was approximately 7.06 years with an average coupon of 5.16%.
FDL’s total common stock portfolio was $24.8 million, representing 1.19% of invested assets and consisting largely of the company’s three wholly-owned insurance subsidiaries totaling $20.5 million. The company owns Kentucky Funeral Director Life Insurance Company domiciled in Kentucky, Funeral Directors Life Insurance Company of Louisiana domiciled in Louisiana, and American Life and Annuity Company domiciled in Arkansas. The public common stock portfolio consists solely of the Monteagle Select Value Fund, valued at $4.3 million, a mutual fund that invests only in Biblically responsible entities.
During 2023, FDL’s mortgage loan portfolio increased by $38.3 million for new loans of $63.4 million, offset by $2.5 million in loans paid off, and $22.6 million in principal payments during the year. The mortgage loan portfolio represented 13.48% of invested assets as opposed to 12.95% in 2022. Virtually all mortgage loans made and retained by FDL are made to funeral home customers and have consistently performed. As of year-end, the company had no mortgage loans over 30 days past due.
At year-end 2023, real estate represented .84% of invested assets compared to .92% in 2022. $15.4 million represents the home office property, and $1.9 million represents the company’s investment property. The $232.5 thousand year-over-year increase in real estate was due to remodeling of the home office space.
Cash and short-term investments represented .39% of invested assets at $8.0 million compared to $8.5 million at yearend 2022.
Other invested assets consisted of loans to parent that were issued in the first quarter of 2007, which comprised .12% of invested assets and surplus debentures of $3.3 million or .16% of invested assets. The principal reduction on the loans to parent was $549.3 thousand for the year.
The portfolio is conservatively positioned to allow for continued improvements going forward. FDL will maintain its long-term focus and not attempt to “time the market” with regard to interest rates. The focus will remain on providing for the policyholders and limiting both market risk and reinvestment risk. New cash flows during 2024 are expected to be reinvested at levels consistent with 2023. The overall book yield increased significantly during 2023, and the portfolio remains diversified and in a positive position to move forward in 2024 and the years to come. Diversification will continue in order to reduce exposure to single portfolio issues, and FDL will diligently invest to provide for the historical investment objectives of the company.
At year-end 2023, FDL’s liabilities were distributed as follows: 97.25% in aggregate reserve for life contracts, 1.12% in asset valuation reserve, .40% in premiums and annuity consideration received in advance, .38% in interest maintenance reserve, .36% in accrued commissions, .09% in federal income tax payable, .06% in policy claims, .04% in provision for policyholders’ dividends, .03% in borrowed funds, and .27% in all other liabilities.
Life insurance and annuity reserves are primarily medium to long-term in nature. Life insurance reserves are calculated on a conservative basis, with virtually all reserves being calculated using an interest factor of 4% or less. Annuity reserves are equal to the current cash surrender value of the annuities plus additional reserves required by Actuarial Guideline 33. The terms of the annuity contracts are conservative, offering interest guarantees of 1% to 5% and no bailout provisions.
Provision for policyholders’ dividends decreased to $800.0 thousand due to the decrease of in-force participating policies. Essentially, a policyholder dividend is the growth rate applied to preneed products and credited to funeral home customers. Annually, the company estimates the dollar amount of dividends to be paid with respect to participating policies in the following calendar year.
The interest maintenance reserve decreased by $795.0 thousand from yearend 2022 for net realized capital losses of $559.0 thousand and amortization of $236.0 thousand. The asset valuation reserve increased $4.5 million or 26.29% in 2023 compared to a $1.9 million increase from 2021 to 2022. The significant increase in 2023 was due to the increase in invested assets as well as the NAIC’s changes to the designations for mortgage-backed securities. Though there were no changes to the underlying characteristics of these type of securities held by FDL, the impact was a $1.3 million increase to AVR with the offsetting decrease to capital and surplus.
Borrowed money for 2023 includes a $517.5 thousand grant from the Development Corporation of Abilene, Inc (DCOA). The initial investment incentive payment of $1.0 million was based upon the company’s expansion of its corporate headquarters and its commitment to create seventy (70) additional positions over a 5-year period. The original terms of the grant required the funds to be recorded as a liability for the first four years until the employment terms had been satisfied, at which time the loan would be forgiven and converted to income. The company surpassed the requirement to add 70 additional positions in 2022, so the DCOA amended the terms of the grant to allow FDL to convert one-fourth of the grant into income over a four-year period beginning in 2022.
Generally, the differences between years in the other liability categories did not result from any significant changes in liability trends but were the result of normal business.
Total capital and surplus increased $8.2 million for 2023 as compared to the increase of $10.3 million in 2022. The increase in 2023 consisted of net income of $9.7 million, a $2.3 million increase in net deferred income tax, unrealized gains of $1.1 million, offset by a $4.5 million increase in asset valuation reserve, and a $312.1 thousand increase in non-admitted assets. The majority of non-admitted assets relate to nonadmitted deferred income tax. The ratio of capital and surplus to total assets was 8.23% at year-end 2023 compared to 8.72% at year-end 2022. No other material favorable or unfavorable trends existed in FDL’s capital and surplus accounts. Capital and
New business issued for 2023 exceeded $521 million, surpassing 2022 by $54.7 million. New business sales were 95% of projected but 11.7% higher than 2022.
Annuity premium income increased 11.1% from 2022 to 2023 while Ordinary Life, Group Life, and Industrial Life premiums increased 14.3%, for a total increase between years of $50.3 million or 12.34%, compared to a 20.22% increase from 2021 to 2022. Single-pay new business sales production for 2023 was 70.8% of total production compared to 72.1% for 2022. The company’s five largest states – Texas, Minnesota, Ohio, Pennsylvania, and Wisconsin – contributed $312.3 million in new business sales. A large part of the growth in 2023 was also attributed to the growth in third-party marketing partners. In 2023, approximately $6.8 million in premium income came from trust conversions compared to $3.0 million in 2022. Trust conversions typically result in higher commissions and reserves in year one but are profitable in future years.
Net investment income increased $13.3 million from year-end 2022 to year-end 2023 compared to the $7.7 million increase from year-end 2021 to year-end 2022. 2023 investment income included $1.0 million in prepayment income from calls and tenders. Income from bond investments increased as interest rates increased, and new business sales provided additional funds for investment. As of December 2023, future asset cash flows exceeded the liability cash flows for a projected thirty years. A continued focus in 2023 was to better align some of the upcoming calendar years and any cash flow discrepancies. The average yield on new bond purchases in 2023 increased approximately 101 basis points, while the yield on the total bond portfolio increased from 4.70% at year-end 2022 to 4.93% at year-end 2023. The average yield on new mortgage loans increased significantly and was 166 basis points higher than bond yields. Net new dollars invested for 2023 were $210.1 million compared to $176.2 million for 2022.
For 2023, overall expenses increased $62.0 million or 12.9% from the previous year compared to an increase of $77.4 million or 19.3% from year-end 2021 to year-end 2022.
Death and annuity benefits paid during the year increased by $13.0 million when compared to 2022 but were only $340.0 thousand more than projected. Monthly claims expenses averaged $18.4 million in 2023 compared to $17.3 million in 2022. With the significant year-over-year increase in new business sales, aggregate reserves increased $27.7 million or 16.3% from 2022. Commissions were up approximately $9.6 million or 16.8% when compared to 2022. General insurance expenses exceeded 2022 by $10.2 million or 27.3% compared to a $7.0 million or 23.2% increase from 2021 to 2022, largely due to an increase in salaries and benefits and sales related expenses to support the growth of the company. Net realized capital gains of $328.5 thousand occurred in 2023 compared to $2.0 million of net realized capital gains in 2022. Capital
gains for 2023 were related to the grant from the DCOA and the sale of common stock. Capital gains for 2022 were related to the sale of real estate investment property. No other material expense changes occurred during 2023.
For 2023, net income was $9.7 million, down from 2022 net income of $12.0 million. The following facts are relevant when comparing net income between 2022 and 2023: 1) new business sales continued to increase; 2) investment yields and additional funds to invest increased; 3) claims were in line with projections, but the increase in new business production coupled with the shift from single-pay to multi-pay led to increased reserves and commissions; 4) the company continued to invest heavily in personnel to support future growth; and 5) the net realized capital gains in 2022 exceeded 2023. Net income fell short of 2022 by $2.4 million.
Through the inflows of premium income and the growth of investment income, FDL has continued to maintain extremely positive cash flow. Premium and investment income have allowed FDL to meet all obligations and invest a considerable amount of the remainder. This trend is expected to continue for 2024 and beyond. However, FDL has made appropriate plans for the future by continuing the investment strategy of matching asset maturities with liability cash flow projections.
FDL continues to be positively positioned from a portfolio structure as well as a reporting standpoint. Moreover, the diversification, structure of the investment portfolio, and limited exposure to troubled securities has afforded FDL the opportunity to benefit versus our competition. New cash flows during 2024 are expected to be reinvested at similar levels as that of 2023 during the first half of the year but could trend lower as the Fed begins easing its restrictive monetary policy through interest rate cuts in the latter half of the year. Over the past several years, inflation concerns drove interest rates up to a large degree. Short-term treasuries (inside 6 months) increased the most in 2023 with the 1-month treasury climbing over 142 basis points throughout the year. While inflation has continued to generally trend downwards, the Fed remains cautious to cut rates preemptively, thus, we currently anticipate rates to remain elevated throughout the first half of 2024 before trending modestly lower.
FDL has maintained considerable liquidity over the years and will continue to do so in the future. As stated previously, current cash flow has always been sufficient to meet maturing insurance and annuity obligations, as well as operating expenses; however, if FDL is required, by some catastrophic event, to generate cash flow, it may do so by liquidating its highly marketable securities.
The company entered 2023 with a very strong ratio of capital and surplus to assets and continued the steady and consistent growth that was interrupted by the pandemic in early 2020. The investment portfolio is highly diversified and structured to generate cash flows sufficient to provide for the cash needs of the company.
These cash needs include the expected claims and all operating needs of the company. FDL is constantly monitoring investment activity, using technology to communicate with employees and customers, and evaluating opportunities to reduce expenses. FDL is strongly positioned for growth in 2024 and beyond.
Year ended December 31 (In Thousands)
Jack Cypert
Robert Hamil
Pat Patton
Drew Seale
Kris Seale
Kasi Welch Baker
Snyder, TX
Abilene, TX
Sauk Centre, MN
Abilene, TX
Abilene, TX
Midland, TX
Leslie Branon Montz
Jack Cypert
Mark France
Robert Hamil
Jeff Harper
Mike Lemons
Pat Patton
Darrell Rains
Dr. Reagan Ramsower
Drew Seale
Kris Seale
Kasi Welch Baker
Fort Worth, TX
Snyder, TX
Austin, TX
Abilene, TX
San Angelo, TX
Austin, TX
Sauk Centre, MN
Austin, TX
Waco, TX
Abilene, TX
Abilene, TX
Midland, TX
Kris Seale
President and CEO, Chairman of the Board
Todd Carlson
EVP of Sales, Chief Sales Officer
Terry Groban
EVP and Chief Financial Officer, Secretary, Treasurer
Paul Lovelace
EVP of Corporate Development
Dwayne McGraw
EVP and Chief Actuary
Dawson Rodriguez
EVP and Chief Information Security Officer
Drew Seale
EVP and Chief Marketing Officer
Jeff Stewart
EVP and Chief Culture Officer
Addison Templeton
EVP and Chief Operations Officer
Amy Biggs VP of Operations
Rob Davidson VP of Creative Services
Jason Gazaille VP of Finance
Melissa Magers VP of Accounting
Mitchell McLean VP of Digital Marketing
Zack Shahan VP of Security Operations
Kyle Swearingen VP of Development
Mark Owen Senior Sales Vice President
Kevin Gaffney
Regional Sales Vice President
John Harrington
Regional Sales Vice President
Jeffery “Stewy” Stewart
Regional Sales Vice President
