Primerica 2010 Annual Report - Direct Selling News

As of each reporting period, all assets andliabilities recorded at fair value are classified intheir entirety based on the lowest level of inputthat is significant to the fair valuemeasurement. Significant levels of estimationand judgment are required to determine thefair value of certain of our investments. Thefactors influencing these estimations andjudgments are subject to change in subsequentreporting periods.The estimated fair value and hierarchyclassifications were as follows:December 31, 2010Level 1 Level 2 Level 3 Fair value(In thousands)Fair value assets:Fixed-maturity securities:U.S. government and agencies $ — $ 22,202 $ — $ 22,202Foreign government — 94,541 — 94,541States and political subdivisions — 27,219 — 27,219Corporates — 1,366,774 19,147 1,385,921Mortgage- and asset-backed securities — 549,188 2,290 551,478Total fixed-maturity securities — 2,059,924 21,437 2,081,361Equity securities 15,110 4,542 3,561 23,213Trading securities — 22,767 — 22,767Separate accounts — 2,446,786 — 2,446,786Total fair value assets $ 15,110 $ 4,534,019 $ 24,998 $ 4,574,127Fair value liabilities:Currency swaps and forwards $ — $ 2,228 $ — $ 2,228Separate accounts — 2,446,786 — 2,446,786Total fair value liabilities $ — $ 2,449,014 $ — $ 2,449,014December 31, 2009Level 1 Level 2 Level 3 Fair value(In thousands)Fair value assets:Fixed-maturity securities:U.S. government and agencies $ — $ 18,487 $ — $ 18,487Foreign government — 390,431 — 390,431States and political subdivisions — 36,038 — 36,038Corporates — 4,097,202 20,445 4,117,647Mortgage-and asset-backed securities — 1,066,966 748,610 1,815,576Total fixed-maturity securities — 5,609,124 769,055 6,378,179Equity securities 15,575 31,535 2,216 49,326Trading securities — 16,996 — 16,996Separate accounts — 2,093,342 — 2,093,342Total fair value assets $15,575 $ 7,750,997 $ 771,271 $ 8,537,843Fair value liabilities:Currency swaps and forwards $ — $ 2,707 $ — $ 2,707Separate accounts — 2,093,342 — 2,093,342Total fair value liabilities $ — $2,096,049 $ — $2,096,049In assessing fair value of our investments, weuse a third-party pricing service forapproximately 95% of our securities. Theremaining securities are primarily privatesecurities valued using models based onobservable inputs on public corporate spreads134 Freedom Lives Here