To my fellow shareholders,

FBL Financial Group had a fantastic 2013, a year of growth and success. We delivered strong financial results and achieved new highs in operating income per share and net income per share. We were able to produce record earnings by growing our business, actively managing spreads, controlling expenses and executing several significant capital management transactions.

These results were achieved because of our commitment to serve our customers and the Farm Bureau member niche. FBL's mission to protect livelihoods and futures comes to life through our agents and employees. By serving, we all win. This commitment to serve is the foundation for all we do.
 

Great Results

FBL produced excellent financial performance again in 2013. Net income increased 47% to a record high of $4.21 per share, and operating income increased 31% to $3.90 per share. We also reached a milestone of more than $100 million in operating income. In 2013 we focused on increasing life insurance sales and we achieved that with a 20% increase in life premium collected. Given the low interest rate environment, over the last few years we have purposely decreased our annuity sales. However, late in 2013 we took several actions to modestly increase annuity sales going forward.

During 2013, we were very active in managing our excess capital. We paid a special dividend of $51 million, repurchased 1.4 million shares of FBL common stock, increased our regular quarterly dividend rate by 36% and paid off $50 million of debt. We continue to manage excess capital and in February 2014 announced a significant increase in our quarterly cash dividend to $0.35 per share. This increase now places us among the highest dividend yields in the insurance industry. This is made possible by our confidence in the company and our ability to generate significant capital.
 

Driven to Win

FBL Financial Group, its leaders, employees and agents are driven to win, to make insurance simple and life more secure for our customers. We always have our purpose in mind – to protect livelihoods and futures – in all that we do.

Our exclusive Farm Bureau agents are one of our most important competitive advantages. We continue to invest in and develop agents for the future in order to grow our total agent count and improve retention. Consumers want to have a face-to-face, trusted relationship with their agent. Our exclusive Farm Bureau agents are part of the community, are committed to serving the Farm Bureau niche marketplace and have long-term customer relationships. This has led to our industry leading cross-sell rate.

We are focused on increasing existing agent productivity and increasing the size of the agency force. We have made significant changes to our agency leadership, recruiting, training and new agent compensation in order to accomplish this; early results are promising.
 

Going Forward

As we move forward in 2014, we continue to meet the needs of our policyholders – protecting their livelihoods and futures – and further build on FBL's strong financial foundation. We are successfully addressing the challenges of the low interest rate environment, building on our best-in-class distribution and delivering value to our shareholders. I'm very pleased with FBL's 2013 results and I'm optimistic about 2014. I look forward to our continued success.

Sincerely,