WIXLIB

ANNUAL STATEMENT FOR THE YEAR 2016 OF THE Members Mutual Insurance AssociationUNDERWRITING AND INVESTMENT EXHIBITPART 3 - EXPENSESInvestmentEx enses1.TotalClaim adjustment services'65,7581.1 Directo1.2 Reinsurance assumed1.3 Reinsurance ceded65.1582.Commission and brokerage:323,0272,1 Direct excluding contingent.02.2 Reinsurance assumed, excluding contingent2.3 Reinsurance ceded, excluding contingent. 02.4 Contingent - direct.49,7102,6 Contingent· reinsurance ceded .2.7 Policy and membership fees4.23.141Advertising.5.),8386.3,159. 07.8.Salary and related items:199.1998.1 Salaries .15.1168.2 Payroll taxes72,4419.10.Insurance11.Directors' fees20.593.5,89215,35313.Renl and renl items .14.Equipment.oI. 2,53725,54415.16.8,565Printing and stationery12,24317.18.legal and auditing19.Totals (Lines 3 to 18)20.Taxes, licenses and fees:46,27422,162credits 01 .1,01920.2 Insurance department licenses and fees20.3 Gross guaranty association assessments23,18121.Real estate expenses .22.Real estate taxes23.Reimbursements by uninsured plans24.Aggregate write-ins for miscellaneous expenses25.Total expenses incurred26.Less unpaid expenses - current year27.Add unpaid expenses - prior year .28.Amounts receivable relating to uninsured plans, prior year27.4537,6896,055961,387. 77,59752,71929.30.84,377TOTAL EXPENSES PAID Lines 25 - 26 27936,490DETAILS OF WRITE·INS:4,0862401. Miscellaneous2402.2403.02498.1,4222499.to non-alliliates.114,0866,055

ANNUAL STATEMENT FOR THE YEAR 2016 OF THE Members Mutual Insurance AssociationEXHIBIT OF NET INVESTMENT INCOME1.1.11.2I.'2.12.112.22.21,.4.U.S. Government bondsBonds exempt from U.S. taxOther bonds (unaffiliated)Bonds 01 aHillatasPreferred stocks (unaffiliated)Preferred slocks 01 affiliatesCommon stocks (unaffiliated)Common stocks of alflliatesMortgage loans .Real estateContract loans2.551B.Other Invested assets.Da10.236,65211.12. .73.914. . .0903.0998.0999.1501.1502.1503.1598.1599.(a) Includes . .592 accrual of discount less .8,327 amortization of premium and less (b) Includes accrual 01 discount lass amortization of premium and less (e) Includes accrual of discount less (d) Includes accrual 01 dlscounlless(I) Includes accrual of discount tess (h) Includes .interest on encumbrances.amortization 01 premium and tess paid for accrued interest on purchases.amortization of premium.(g) Includes . .73.914 investmBf'lt expenses and segregated and Separate Accounts.7.689. interest on surplus notes and (i) Includes paid lor accrued dividends on purchases. amortization of premium and fess . . paid for accrued Interest on purchases.lor company's occupancy of its own buildings; and excludes (e) Includes 1,270 paid for accrued interest on purchases .9,167 depreciation on real estate and investment taxes, licenses and lees, excluding federal income taxes. attributable tointerest on capital notes.depreciation on other invested assets.Realized Gain (Loss)On Sales or Maturit1.1.11.2U.S. Govemment bondsooo1.,2.12.112.22.213.4.5. 0oCommon stocks (unaffiliated)Common stocks 01 aHiliales.Mortgage loansReal estateContract loans. 0oo67.8.Derivative instruments .Other Invested assets9.10.0901.0902.0903.0998.Summary of remaining write-ins for Line 9 from0999.Totals (Lines 0901 thru 0903 plus 0998) (Line 9 .overflow page . b,,,,12

ANNUAL STATEMENT FOR THE YEAR 2016 OF THE Members Mutual Insurance AssociationEXHIBIT OF NON-ADMITIED ASSETS1.Bonds (Schedule 0)2.Stocks (Schedule D):2,1 Preferred stocks .2.2 Common stocks.3. . 03.1 Firsillens .4.Real estata (Schedule A):oo. 05.6.Contract loans . .7.DerlvativBs (Schedule DB)8.Other Invested assets (Schedule BA)9.Receivables lor securities. 0. 010.11.Aggregate write-ins lor Invested assets .12.13.Title plants (for Tille insurers only)14.Investment income due and accrued15.Premiums and considerations:15.1 Uncollected premiums and agents' balances in the course of colleclion15.3 Accrued retrospective premiums and contracts subject to redetermination16.Reinsurance:IS.1 Amounts recoverable Irom reinsurers16.2 Funds held by or deposited with reinsured companies16.3 Other amounts receivable under reinsurance contracts17.Amounts receivable relating to uninsured plans .18.118.2 Net deferred tax assel.19.20. 1.27821.22. 023.Receivables Irom parent, subsidiaries and allillates24.Health care and other amounts receivable25.Aggregate write-ins lor other than invested assels . .,. ,0(18.450)26. (18.339)27.o28.(18.339)DETAILS OF 02.2503.2598.18.4502599.13(18.450)

ANNUAL::; I AII::MI::N I I-UH I HI:: YI::AH 2016 UI- I HI:: Members Mutual Insurance AssociatIOnNOTES TO FINANCIAL STATEMENTS1.Summary of Significant Accounting Policiesa. The accompanying financial statements of the Company have been prepared in conformity with accountingpractices prescribed or permitted by the National Association of Insurance Commissioners and the State of Iowa,with no exceptions.b. The preparation of the financial statements of the Company in conformity with Statutory Accounting Principlesrequires management to make estimates and assumptions that affect the reported amounts of assets and liabilities. Italso requires disclosure of contingent assets and liabilities at the date of the financial statements and the reportedamounts of revenue and expenses during the period. Actual results could differ from those estimates.c. Premiums are earned over the term of the related insurance policies and reinsurance contracts. Unearnedpremium reserves are established to cover the unexpired portion of premiums written. Such reserves are computedby pro rata methods for direct and ceded business.Expenses incurred in connection with acquiring new insurance business, including such acquisition costs as salescommissions, are charged to operations as incurred. Expenses incurred are reduced for ceding allowances receivedor receivable.Asset values are generally stated as follows: Bonds, (except for those to which the Securities Valuation Office rSVO") ofthe NAIC has assigned a value} are stated at cost or amortized cost using the interest method; stocks at market.The Company uses the straight line method of depreciation for all of its real estate holdings with the lives varyingdepending on the type of building.2.3.Accounting Changes and Corrections of Errorsa. The Company had no material changes in accounting principles or corrections of errors. However, on April 1,2014, the Company switched from coverage under Section 518 01 the Code of Iowa to Section 518A of the Code01 Iowa.b. As a Mulual Company, Codification does not apply.Business Combinations and Goodwilla. The Company had no business combinations accounted for under the statutory purchase method.b. The Company formed a statutory merger with Ida Mutual Insurance Association (07B) on April 1. 2014.c. The Company had no impairment loss recognized during the year.4.Discontinued OperationsThe Company did not have any discontinued operations.5.Investmentsa. The Company has no mortgage loans.b. The Company is not a creditor for any restructureddebt.c. The Company has no reverse mortgages.d. 1. The Company has elected to use the book value as of January 1, 1994 as the cost for applying the retrospectiveadjustment method to securities purchased prior to that date.2. Prepayment assumptions for single class and multi·class mortgage·backed/asset·backed securities were obtainedfrom Bloomberg. These assumptions are consistent with the current interest rate and economic environment.3. The Company used the NAIC Securities Valuation Office in determining the market value of its loanbacked securities. When this was not available the Company then used the Comerica custodial account.4. The Company continues to use the retrospective adjustment method to value all loan-backed securities.e. The Company has no repurchase agreements.6.Joint Ventures, Partnerships and Limited Liability Companiesa. The Company has no investments in Joint Ventures, Partnerships or Limited Liability Companies that exceed 10%of its admitted assets.b. The Company did not recognize any impairment write down for its investments in Joint Ventures, Partnerships orLimited Liability Companies during the statement periods.7.Investment IncomeThe Company does not exclude (non-admit) any interest income due and accrued.8.Derivative InstrumentsThe Company has no derivative instruments.9.Income Taxesa. The Company has no deferred tax asset or liability.b. There were no deferred tax liabilities not recognized in the currentperiod.c. Federal Income Taxes incurred for 2016 were ( 20,474).d. Since the company had a net taxable loss in 2016, the effective tax rate is zero.14

ANNUAL STATEMENT FOR THE YEAR 2016 OF THE Members Mutual Insurance AssociationNOTES TO FINANCIAL STATEMENTSe. 1. As of December 31,2016, the Company did not have any operating loss carry forwards.2. The following are income taxes incurred in the current and prior years that will be available for recovery inthe event of future loss:Year Starting with CUrrent Year20162015Amount( 20,474) 119.889f. The Company's Federal Income Tax return is a consolidated return with Buena Vista Mutual Agency, Inc.10. Information Concerning Parent, Subsidiaries and Affiliatesa. The Company is not directly or indirectly owned or controlled by any other entity.b. There were no applicable transactions.C.At December 31,2016, the Company had no amounts due to or from an affiliate or related party.d. There are no guarantees or undertakings. written or otherwise, for the benefit of an affiliate or related partythat result in a material contingent exposure 01 the Company's or any related party's assets or liabilities.e. The Company is not directly or indirectly owned or controlled by any other entity.f. The Company does not own shares of an upstream intermediate or ultimate parent, either directly or indirectlyvia a downstream subsidiary, controlled or affiliated company.g. The Company does not have an investment in a Subsidiary, Controlled or Affiliated Company that exceeds10% of admitted assets of the insurer.h. The Company did not recognize any impairment write down for its investments in Subsidiary, Controlled orAffiliated Company during the statement period.11. Debta. The Company has no capital notes.b. The Company has no outstanding debentures, borrowed money or reverse repurchase agreements.12. Retirement Plans, Deferred Compensation, Postemployment Benefits and Compensated Absences and Other Postretirement Benefit Plansa. The Company has no Defined Benefit Plan.b. The Company has a Deferred Compensation Plan in which 3% of their salary is directly contributed to their individualretirement account.c. The Company has no employer contributions to multiemployer plans.d. The Company has no Consolidated/Holding Company Plans.13. Capital and Surplus, Dividend Restrictions and Quasi-Reorganizationsa. The Company has no capital stock.b. The Company has no preferred stock outstanding.c. As a Mutual Company, shareholder dividend restrictions criteria do not apply.d. There are no restrictions placed on the portion of Company profits that may be paid as ordinarydividends to stockholders.e. There were no restrictions placed on the Company's surplus, including for whom the surplus is being held.f.The Company does not have any advances to surplus not repaid.g. The Company has no stock held for special purposes.14.1

ANNUAL STATEMENT FOR THE YEAR 2016 OF THE Members Mutual Insurance AssociationNOTES TO FINANCIAL STATEMENTSh. The Company has no special surplus funds from the prior period.The portion of unassigned funds (surplus) represented or reduced by each item below is as follows:1. unrealized gain and losses: 374,4452. nonadmitted asset values:( 31,066)3. provision for reinsurance:( 52,880)j.No surplus debentures or similar obligations exist.k. The Company has no quasi-reorganization.14. Contingenciesa. The Company has a contingent commission liability of 33,816.b. The Company does not have any assessments that could have a material financial effect.c. The Company has no loss contingencies.15. Leasesa. The Company does not have any material lease obligations at this time.16. Information About Financial Instruments with Off· Balance Sheet Risk and Financial Instruments with Concentrationsof Credit Riska. The Company does not have financial instruments with off·balance sheet risk or with concentrations of credit risk.17. Sale, Transfer and Servicing of Financial Assets and Extinguishments of Liabilitiesa. The Company has no transfers of receivables reported as sales.b. The Company has no transfer and servicing of financial assets.c. The Company has no wash sales.18. Gain or Loss to the Reporting Entity from Uninsured A & H Plans and the Uninsured Portions of Partially Insured PlansThe Company has no uninsured accident and health plans or uninsured portions of partially insured plans for which theCompany serves as administrator.19. Direct Premiums Written/Produced by Managing General AgentsfThird Party AdministratorsThe Company has no premiums written/produced by Managing General Agents or Third Party Administrators.20. Fair Value MeasurementsThe Company uses fair value measurements in reporting preferred and common stocks in the financial statements.The Company uses third'party pricing services (Custodial accounts, brokerage accounts, and related market date)to determine the market value of the securities.21. Other Itemsa. The Company has no extraordinary items to report.b. The Company did not have any troubled debt restructuring.c. The Company elected to use rounding method in reporting amounts in the statement.22. Events SubsequentThere have been no events occurring subsequent to the close of the books or accounts which may have a material effect onthe financial condition of the Company.23. Reinsurancea. The Company has no unsecured aggregate recoverable for losses, paid or unpaid including 18NR, lossadjustment expenses, and unearned premiums that exceed 3% of policyholder surplus.b. The Company has no insurance recoverable in dispute.c. The Company has no commission amounts due and payable to reinsurers if either party were to cancel coverage.d. The Company has no uncollectible reinsurance written off during the year for Losses Incurred, Loss AdjustmentExpenses Incurred or Premiums Earned.e. The Company had no communication of Ceded Reinsurance during the year for Losses Incurred, Loss AdjustmentExpenses Incurred or Premiums Earned.f.The Company has no retroactive reinsurance contracts.24. Retrospectively Rated ContractsThe Company has no retrospectively rated contracts.25. Change in Incurred Losses and Loss Adjustment ExpensesThere has been no changes in the provision for incurred loss and loss adjustment expenses attributable to insuredevents of prior years.26. Intercompany Pooling ArrangementsThe Company has no intercompany pooling arrangements.14.2

ANNUAL STATEMENT FOR THE YEAR 2016 OF THE Members Mutual Insurance AssociationNOTES TO FINANCIAL STATEMENTS27. Structured Settlementsa. The Company has not purchased any annuities tor which a claimant islisted as payee.b. The Company does not own any annuities due from any life insurer.28. Health Care ReceivablesThe Company has no pharmaceutical rebates or risk sharing receivables.29. Participating PoliciesThe Company does not have participating accident and health policies.30. Premium Deficiency ReservesThe Company does not have deficiency reserves to report.3t. High DeductiblesThe Company has no reserve credit that has been recorded for high deductibles on unpaid claims.32. Discounting of Liabilities for Unpaid Losses or Unpaid Loss Adjustment ExpensesThe Company does not discount its Unpaid Losses or Unpaid Loss Adjustment Expenses.33. Asbestos/Environment ReservesThe Company has no potential for liability due to asbestos or environment losses.34. Subscriber Savings AccountsThe Company is not a reciprocal insurance company.35. Multiple Peril Crop Insurance - Not Applicable.36. Financial Guaranty InsuranceThe Company has no guarantee insurance contracts.14.3

ANNUAL STATEMENT FOR THE YEAR 2016 OF THE Members Mutual Insurance AssociationGENERAL INTERROGATORIESPART 1 COMMON INTERROGATORIESGENERAL1.1Is the reporting entity a member of an Insurance Holding Company System consisting of two or more affiliated persons, ona or more 01 whichYes!is an Insurer?1 No[X]II yes, complete Schedule Y, Parts 1, 1A and 21.2If yes, did the reporting entity register and file with Its domiciliary State Insurance Commissioner, Director or Superintendent, or withsuch regulatory official 01 the state of domicile 01 the prlnclpal insurer in the HOlding Company System, a registration slatementproviding disclosure substantially slmitar to the standards adopted by the National Association 01 Insurance Commissioners (NAte) Inits Model Insurance Holding Company System Regulatory Act and model regulations pertaining thereto, or is the reporting entitysubject to standards and disclosure requirements substantially similar to those required by suc

17.1 Other liability -occurrence 17.2 Other liability -claims-made 17.3 Excess workers' compensation 18.1 Products liability -occurrence ." 18.2 Products liability -claims-made 19.1,19.2 Private passenger auto liability 19.3, 19.4 Commercial auto liability 21. Auto physical damage 22. Aircraft (all perils) _. ". Fidelity 24. Surety 26.