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Claims and Surrenders. A breakout of claims and surrender benefits is detailed below. 

## CITIZENS, INC. AND CONSOLIDATED SUBSIDIARIES 

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## For the Years Ended December 31, 

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• Death claims expense increased 6.3% in 2018 compared to 2017 and decreased 6.0% in 2017 compared to 2016. No unusual trends have been noted in our claims experience. Mortality experience is closely monitored by the Company as a key performance indicator and these amounts were within expected levels. 

• We noted increases in surrender expense over the last several years, which is primarily related to activity in Colombia and Venezuela and is expected to increase over time due to the aging of this block of business and the larger distribution of in force business in these two top countries, as well as the overall aging of the business in general. Most of policy surrender benefits paid is attributable to our international business and historically was related to policies that have been in force over fifteen years, when surrender charges are no longer applicable. 

• Endowment benefit expense results from the election by policyholders of a product feature that provides an annual benefit. This is a fixed benefit over the life of the contract, and this expense will increase with new sales and improved persistency. 

• Matured endowments increased 261.6% in 2018 after decreasing 19.5% in 2017. We expect this increasing trend to continue as this block of business increases, persists and policies begin to reach maturity. 

• Other policy benefits resulted primarily from interest paid on premium deposits and policy benefit accumulations that increased as these policy liabilities also increased. 

Increase in Future Policy Benefit Reserves. Policy benefit reserves in 2018 decreased compared to the same period in 2017, primarily due to changes in actuarial valuation estimates associated with the conversion to the new actuarial valuation system, AXIS, in 2018 that resulted in a decrease in reserves of $11.9 million when compared to 2017. 

