US Alliance Corp Files Q2 2025 10-Q

TL;DR

**US Alliance Corp Q2 10-Q filed. Fair value disclosures updated.**

AI Summary

US Alliance Corp filed its 10-Q for the period ending June 30, 2025. The company, incorporated in Kansas and operating in the life insurance sector, reported its financial status. Key financial data and disclosures related to fair value measurements for the periods ending December 31, 2024, and June 30, 2025, were included in the filing.

Why It Matters

This filing provides investors with an update on US Alliance Corp's financial performance and position for the second quarter of 2025, including details on asset valuations.

Risk Assessment

Risk Level: low — This is a routine quarterly filing with no immediately apparent significant negative events.

Key Numbers

• 20250630 — Reporting Period End Date (Indicates the end of the fiscal quarter for which the report is filed.)
• 20250815 — Filing Date (The date the 10-Q was officially submitted to the SEC.)

Key Players & Entities

• US Alliance Corp (company) — Filer of the 10-Q
• 20250630 (date) — End of reporting period
• 20250815 (date) — Filing date
• LIFE INSURANCE (industry) — Company's Standard Industrial Classification
• KS (location) — State of incorporation

FAQ

Key Financial Figures

• $0.10 — latest practicable date. Common stock, $0.10 par value 7,748,922 shares outstanding

Filing Documents

• usac20250630_10q.htm (10-Q) — 1876KB
• ex_850066.htm (EX-31.1) — 8KB
• ex_850067.htm (EX-31.2) — 8KB
• ex_850068.htm (EX-32.1) — 4KB
• ex_850069.htm (EX-32.2) — 4KB
• 0001437749-25-027030.txt ( ) — 8324KB
• usac-20250630.xsd (EX-101.SCH) — 48KB
• usac-20250630_cal.xml (EX-101.CAL) — 57KB
• usac-20250630_def.xml (EX-101.DEF) — 328KB
• usac-20250630_lab.xml (EX-101.LAB) — 283KB
• usac-20250630_pre.xml (EX-101.PRE) — 351KB
• usac20250630_10q_htm.xml (XML) — 1996KB

- Financial Information

Part I - Financial Information Item Item Description Page Item 1

Financial Statements

Financial Statements 3 Consolidated Balance Sheets (unaudited) 3 Consolidated Statements of Comprehensive Income (Loss) (unaudited) 4 Consolidated Statements of Changes in Shareholders' Equity (unaudited) 5 Consolidated Statements of Cash Flows (unaudited) 6

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 7 Item 2

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 23 Item 3

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 35 Item 4

Controls and Procedures

Controls and Procedures 35

- Other Information

Part II - Other Information Item Item Description Item 1

Legal Proceedings

Legal Proceedings 35 Item 1A

Risk Factors

Risk Factors 35 Item 2 Unregistered Sales of Equity Securities and Use of Proceeds 35 Item 3 Defaults Upon Senior Securities 35 Item 4 Mine Safety Disclosures 35 Item 5 Other Information 35 Item 6 Exhibits 36

Signatures

Signatures 37 2 Table of Contents US Alliance Corporation Consolidated Balance Sheets June 30, 2025 December 31, 2024 (unaudited) Assets Investments: Available for sale fixed maturity securities (amortized cost: $ 82,133,900 and $ 83,785,307 , net of allowances for credit losses of $ 0 and $ 0 , as of June 30, 2025 and December 31, 2024, respectively) $ 78,295,337 $ 79,578,179 Equity securities, at fair value 3,433,420 3,876,085 Limited partnership interests 773,810 428,170 Mortgage loans on real estate (net of allowance for credit losses of $ 66,408 and $ 55,685 as of June 30, 2025 and December 31, 2024, respectively) 25,868,144 25,192,749 Other invested assets 1,261,067 1,109,606 Policy loans 33,280 31,745 Real estate, net of depreciation 1,625,266 1,652,553 Total investments 111,290,324 111,869,087 Cash and cash equivalents 3,757,103 6,903,783 Investment income due and accrued 844,952 954,324 Reinsurance related assets 851,275 522,142 Deferred acquisition costs, net 3,927,814 3,908,636 Value of business acquired, net 2,287,343 2,333,553 Property, equipment and software, net 133,600 136,353 Goodwill 277,542 277,542 Federal and state income tax receivable 178,085 182,349 Deferred tax asset, net of valuation allowance 3,856,841 3,747,111 Other assets 856,786 459,102 Total assets $ 128,261,665 $ 131,293,982 Liabilities and Shareholders' Equity Liabilities: Policy liabilities Deposit-type contracts $ 71,068,783 $ 77,940,378 Policyholder benefit reserves 42,829,475 39,898,138 Dividend accumulation 100,441 100,885 Advance premiums 216,322 248,749 Total policy liabilities 114,215,021 118,188,150 Accounts payable and accrued expenses 1,660,884 1,133,521 Federal Home Loan Bank advance 1,250,000 1,250,000 Other liabilities 650,301 91,893 Total liabilities 117,776,206 120,663,564 Shareholders' Equity: Com

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Note 1. Description of Business and Significant Accounting Policies Description of business : US Alliance Corporation ("USAC") was formed as a Kansas corporation on April 24, 2009 to raise capital to form a new Kansas-based life insurance company. Our offices are located at 1303 SW First American Place, Suite 200, Topeka, Kansas 66604. Our telephone number is 785-228-0200 and our website address is www.usalliancecorporation.com . USAC has four wholly-owned operating subsidiaries. US Alliance Life and Security Company ("USALSC") was formed June 9, 2011, to serve as our life insurance company. US Alliance Marketing Corporation ("USAMC") was formed April 23, 2012, to serve as a marketing resource. US Alliance Investment Corporation ("USAIC") was formed April 23, 2012 to serve as investment manager for USAC. Dakota Capital Life Insurance Company ("DCLIC"), was acquired on August 1, 2017 when USAC merged with Northern Plains Capital Corporation ("NPCC") and was merged into USALSC on December 31, 2023. US Alliance Life and Security Company - Montana (USALSC-Montana), was acquired December 14, 2018. USALSC-Montana is a wholly-owned subsidiary of USALSC. Unless the context indicates otherwise, references herein to the "Company" refer to USAC and its consolidated subsidiaries. The Company terminated its initial public offering on February 24, 2013. During the balance of 2013, the Company achieved approval of an array of life insurance and annuity products, began development of various distribution channels and commenced insurance operations and product sales. The Company sold its first insurance product on May 1, 2013. The Company continued to expand its product offerings and distribution channels throughout 2014 and 2015. On February 24, 2015, the Company commenced a warrant exercise offering set to expire on February 24, 2016. On February 24, 2016, the Company extended the offering until February 24, 2017 and ma

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Income (loss) per share attributable to USAC's common stockholders were computed based on the net income (loss) and the weighted average number of shares outstanding during each year. The weighted average number of shares outstanding during the six months ended June 30, 2025 and 2024 were 7,748,922 shares. The weighted average number of shares outstanding during the three months ended June 30, 2025 and 2024 were 7,748,922 shares. Potential common shares are excluded from the computation when their effect is anti-dilutive. There was no difference between basic and diluted net loss per common share for the three and six months ended June 30, 2025 and 2024. New accounting standards : Improvements to Income Tax Disclosures In December 2023, the FASB issued Accounting Standards Update 2023-09 "Income Taxes (Topic 740): Improvements to Income Tax Disclosures" ("ASU 2023-09"). ASU 2023-09 is intended to improve the effectiveness of income tax disclosures by requiring, among other things, the disclosure on an annual basis of: (i) specific categories in the rate reconciliation; and (ii) additional information for reconciling items that meet a quantitative threshold. In addition, ASU 2023-09 requires disclosure (on an annual basis) of the following information about income taxes paid: (i) the amount of income taxes paid (net of refunds received) disaggregated by federal (national), state, and foreign taxes; and (ii) the amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than 5 percent of total income taxes paid (net of refunds received). ASU 2023-09 is effective for annual periods beginning January 1, 2026, to be applied prospectively with an option for retrospective application (with early adoption permitted). The adoption of ASU 2023-09 will modify our disclosures but will not have an impact on o

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Note 2. Investments Fixed Maturity The amortized cost and fair value of available for sale investments as of June 30, 2025 and December 31, 2024 is as follows: June 30, 2025 Cost or Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value (unaudited) Available for sale: Fixed maturities: US Treasury securities $ 805,065 $ 129 $ ( 79,359 ) $ 725,835 Corporate bonds 22,336,984 183,945 ( 2,825,717 ) 19,695,212 Municipal bonds 5,389,800 900 ( 606,107 ) 4,784,593 Redeemable preferred stock 2,563,964 3,916 ( 169,310 ) 2,398,570 Term loans 11,080,023 26,208 ( 179,483 ) 10,926,748 Mortgage backed and asset backed securities 39,958,064 653,604 ( 847,289 ) 39,764,379 Total available for sale $ 82,133,900 $ 868,702 $ ( 4,707,265 ) $ 78,295,337 December 31, 2024 Cost or Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value Available for sale: Fixed maturities: US Treasury securities $ 799,543 $ - $ ( 88,166 ) $ 711,377 Corporate bonds 24,370,244 111,868 ( 2,990,292 ) 21,491,820 Municipal bonds 5,416,888 - ( 675,739 ) 4,741,149 Redeemable preferred stock 2,562,893 36 ( 151,695 ) 2,411,234 Term loans 12,971,452 28,936 ( 212,084 ) 12,788,304 Mortgage backed and asset backed securities 37,664,287 715,541 ( 945,533 ) 37,434,295 Total available for sale $ 83,785,307 $ 856,381 $ ( 5,063,509 ) $ 79,578,179 The amortized cost and fair value of debt securities as of June 30, 2025 and December 31, 2024, by contractual maturity, are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. As of June 30, 2025 As of December 31, 2024 Amortized Cost

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Note 2. Investments (continued) In June 2016, the FASB issued ASC 326 ("Current Expected Credit Loss (CECL)"). The updated guidance applies a new credit loss model (current expected credit losses or CECL) for determining credit-related impairments for financial instruments measured at amortized cost (e.g. mortgage loans and reinsurance recoverables) and requires an entity to estimate the credit losses expected over the life of an exposure or pool of exposures. The estimate of expected credit losses should consider historical information, current information, as well as reasonable and supportable forecasts, including estimates of prepayments. The expected credit losses, and subsequent adjustments to such losses, will be recorded through an allowance account that is deducted from the amortized cost basis of the financial asset, with the net carrying value of the financial asset presented on the consolidated balance sheet at the amount expected to be collected. Changes in the allowance for credit losses are included in net losses. Proceeds from the sale of securities, maturities, and asset paydowns for the six months ended June 30, 2025 and 2024 were $ 7,633,681 and $ 12,730,393 , respectively. Realized gains and losses related to the sale of securities and net credit losses recognized in income are summarized as follows: Six Months Ended June 30, (unaudited) 2025 2024 Gross gains $ - $ 22,070 Gross losses ( 500,890 ) ( 67,024 ) Net security losses $ ( 500,890 ) $ ( 44,954 ) Fixed maturity securities - ( 116,563 ) Mortgage loans on real estate ( 10,723 ) ( 9,137 ) (Increase) Decrease in allowance for credit losses $ ( 10,723 ) $ ( 125,700 ) Proceeds from the sale of securities, maturities, and asset paydowns for the three months ended June 30, 2025 and 2024 were $ 3,921,056 and $ 9,149,837 , respectively. Realized gains and losses related to the sale of sec

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) Note 2. Investments (continued) Gross unrealized losses by duration are summarized as follows: Less than 12 months Greater than 12 months Total Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss June 30, 2025 (unaudited) Available for sale: Fixed maturities: US Treasury securities $ 250,108 $ ( 466 ) $ 274,969 $ ( 78,893 ) $ 525,077 $ ( 79,359 ) Corporate bonds 626,499 ( 17,863 ) 12,428,385 ( 2,807,854 ) 13,054,884 ( 2,825,717 ) Municipal bonds 879,611 ( 41,204 ) 3,591,043 ( 564,903 ) 4,470,654 ( 606,107 ) Redeemable preferred stock - - 1,774,006 ( 169,310 ) 1,774

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