Globe Life (GL) risk factors, FY2024 10-K

Business and Operational Risks

1. 01The development and maintenance of our various distribution channels are critical to growth in product sales and profits
2. 02Our future success depends, in substantial part, on our ability to recruit, hire, and motivate highly-skilled insurance personnel. Further, the development and retention of producing agents are critical to supporting sales growth in our agency operations because our insurance sales are primarily made to individuals
3. 03Our life insurance products are sold in niche markets. We are at risk should any of these markets diminish
4. 04Actual or alleged misclassification of independent contractors at our insurance subsidiaries could result in adverse legal, tax or financial consequences
5. 05The use of third-party vendors, including independent sales agents, to support the Company's operations makes the Company susceptible to the operational risk of those third parties, which could lower revenues, increase costs, reduce profits, disrupt business, or damage the Company’s reputation
6. 06operates in a poorly controlled manner or fails to deliver contracted services, which could lower revenues, increase costs, reduce profits, disrupt business, or damage the Company’s reputation

Financial and Strategic Risks

1. 07Our investments are subject to market and credit risks. Significant downgrades, delinquencies and defaults in our investment portfolio could potentially result in lower net investment income and increased realized and unrealized investment losses
2. 08Changes in interest rates could negatively affect income
3. 09Our ability to fund operations is substantially dependent on available funds from our insurance subsidiaries
4. 10Other sources of liquidity include a variety of short-term and long-term instruments, including our credit facility, commercial paper, long-term debt, Federal Home Loan Bank (FHLB), intercompany financing and reinsurance
5. 11We are subject to liquidity risks associated with sourcing a concentration of our funding from the Federal Home Loan Bank (“FHLB”)
6. 12Adverse capital and credit market conditions may significantly affect our ability to meet liquidity needs or access capital, as well as affect our cost of capital
7. 13We have become subject to, and may in the future be subject to, short selling strategies driving down the market price of our common stock

Industry Risks

1. 14Variations in actual-to-expected rates of mortality, morbidity and policyholder behavior could materially negatively affect our results of operations and financial condition
2. 15A ratings downgrade or other negative action by a rating agency could materially affect our business, financial condition, and results of operations
3. 16Obtaining timely and appropriate premium rate increases for certain supplemental health insurance policies is critical
4. 17Our business is subject to the risk of the occurrence of catastrophic events that could adversely affect our financial condition or operations
5. 18We are exposed to model risk, which is the risk of financial loss or reputational damage or adverse regulatory impacts caused by model errors or limitations, incorrect implementation of models, or misuse of or overreliance upon models
6. 19Our business is subject to the risk of direct or indirect effects of climate change

Legal, Regulatory, and Compliance Risks

1. 20Recent volatility in the trading price of our common stock has and can be expected to result in securities class action litigation
2. 21Our businesses are heavily regulated and changes in regulation or regulatory scrutiny may have a material adverse impact on our business, financial condition or results of operation
3. 22Changes in accounting standards issued by accounting standard-setting bodies may affect our financial statements, reduce our reported profitability and change the timing of profit recognition
4. 23Non-compliance with laws or regulations related to customer and consumer privacy and information security, including a failure to ensure that third parties with access to sensitive customer and consumer information maintain its confidentiality, could materially adversely affect our reputation and business operations
5. 24The failure to maintain effective and efficient information systems at the Company could adversely affect our financial condition and results of operations
6. 25Changes in U.S. federal income tax law could increase our tax costs or negatively impact our insurance subsidiaries' capital
7. 26Damage to the brand and reputation of Globe Life or its subsidiaries could affect our ability to conduct business
8. 27We may fail to meet expectations relating to corporate responsibility and sustainability standards and practices