Primerica 2010 Annual Report - Direct Selling News

amortize the higher DAC balance resulting fromthe change in our DAC and reserve estimationapproach in 2008. We also adjusted ourestimation for waiver of premium coverages toreflect additional lapses that occur at the endof the initial level premium period, resulting inan approximately $14 million increase in DACamortization.Acquisition and operating expenses, net ofdeferrals. Acquisition and operatingexpenses, net of deferrals, increased $17.3million, or 13%, to $152.4 million for the yearended December 31, 2009 from $135.0 millionfor the year ended December 31, 2008. Thisincrease was primarily attributable to a $9.0million increase in nondeferrable commissionsrelated to a special incentive compensationpayment to the sales force and an $8.1 millionadjustment in expense allowance accrualsmade in conjunction with the change in DACand reserve estimation approach.Investments and Savings ProductsSegmentYear endedDecember 31,Change2009 2008 $ %(Dollars in thousands)RevenuesCommissions and fees $289,626 $ 374,791 $ (85,165) -23%Other, net 10,514 11,717 (1,203) -10%Total revenues 300,140 386,508 (86,368) -22%ExpensesCommission expenses,including amortization ofDAC 143,000 193,148 (50,148) -26%Other operating expenses 63,736 68,197 (4,461) -7%Total expenses 206,736 261,345 (54,609) -21%Segment income beforeincome taxes $ 93,404 $ 125,163 $ (31,759) -25%Primerica 2010 Annual Report 95