Concerned Shareholders of Life Insurance Company of Alabama (LICOA)
This webpage is for fellow minority shareholders of Life Insurance Company of Alabama ("LICOA"), a small insurance company that is headquartered in Gadsden, Alabama. The company has two classes of stock which trade on the OTC, one is "LINS" and the other is "LINSA".
Despite being owned by a diverse group of shareholders, LICOA is controlled by descendants of its founder Clarence W Daugette, who work for and/or sit on the board of the company. The interests of this family group inevitably conflict with the interests of those of us shareholders who are “outside the family”.
Over the three years from 2017-2019, LICOA earned only $856,126 on average per year. The return on equity that we shareholders are getting is barely 2%. The investments that LICOA owns earn more than this – they had net investment income of $4.6 million on a $101 million bond portfolio last year. So our capital has been leveraged by a factor of 2.5 to one, only for our return to be lower than the underlying investments. We are taking more risk and getting less reward – a totally unacceptable tradeoff.
LICOA stock trades at depressed prices. The 52 week low for a LINSA share was $11.24, only 29% of the amount of capital and surplus per share (which was $39.13) that the LINSA shares had at the end of 2019.
Two LAWSUITS have been filed by different groups of LICOA shareholders against the company and certain of its directors. Please contact us if you would like to receive copies of the complaints or other pleadings.
LICOA has made offers to settle litigation with some of the plaintiffs via buying them out. In March 2020, they offered some plaintiffs the equivalent of $25 per LINSA share.
We believe that all LICOA shareholders should pay attention to the urgent situation at hand and start doing their own research into the performance of the company and the conduct of management. Everyone involved with LICOA should seek their own investment advice and legal advice. (This website provides neither.)
We want to hear from fellow shareholders. Email email@example.com