FBL Financial (FFG) 8-K FBL Financial Group Reports Fourth Quarter 2008 Results and Declares Quarterly Dividend

Exhibit 99.2

I N T E G R I T Y

F I N A N C I A L S T R E N G T H

O P E R A T I O N A L E X C E L L E N C E

F i n a n c i a l S u p p l e m e n t
December 31, 2008
	For more information contact:
	Jim Brannen
	Chief Financial Officer
	Jim.Brannen@FBLFinancial.com
	TEL: 515.225.5631
	Don Seibel
	Vice President - Finance
	Don.Seibel@FBLFinancial.com
	TEL: 515.226.6399
	Kathleen Till Stange
	Investor Relations Vice President	NYSE: FFG
	Kathleen.TillStange@FBLFinancial.com	www.fblfinancial.com
	TEL: 515.226.6780

FBL Financial Group, Inc.
Financial Supplement (Unaudited)
December 31, 2008
Table of Contents/Notes
Consolidated Financial Statements:
Consolidated Balance Sheets	2
Consolidated Statements of Operations	4
Consolidated Statements of Operating Income (Loss), last five quarters	5
Financial Information by Segment:
Segment Information	6
Consolidating Statements of Pre-tax Operating Income (Loss)	7
Statements of Pre-tax Operating Income (Loss), last five quarters:
Traditional Annuity - Exclusive Distribution Segment	8
Traditional Annuity - Independent Distribution Segment	9
Traditional and Universal Life Insurance Segment	10
Variable Segment	11
Corporate and Other Segment	12
Deferred Policy Acquisition Costs by Segment	13
Collected Premiums, last five quarters	14
Other Information	15

NOTE 1: In addition to net income (loss), FBL Financial Group has consistently utilized operating income (loss), a non-GAAP financial measure commonly used in the life insurance industry, as a primary economic measure to evaluate its financial performance. Operating income (loss) for the periods presented equals net income (loss) adjusted to eliminate the impact of:

• realized and unrealized gains and losses on investments;

• changes in net unrealized gains and losses on derivatives;

• the cumulative effect of changes in accounting principles.

We use operating income (loss), in addition to net income (loss), to measure our performance since realized and unrealized gains and losses on investments and the change in net unrealized gains and losses on derivatives can fluctuate greatly from quarter to quarter.  Also, the cumulative effect of changes in accounting principles is a nonrecurring item.  These fluctuations make it difficult to analyze core operating trends.  In addition, for derivatives not designated as hedges, there is a mismatch between the valuation of the asset and liability when deriving net income (loss).  Specifically, call options relating to our index business are one or two-year assets while the embedded derivative in the index contracts represents the rights of the contract holder to receive index credits over the entire period the index annuities are expected to be in force.  For our other embedded derivatives in the product segments and interest rate swaps backing our annuity liabilities, the embedded derivatives are marked to market, but the associated insurance liabilities are not marked to market.  A view of our operating performance without the impact of these mismatches and non-recurring items enhances the analysis of our results.  We use operating income (loss) for goal setting, determining company-wide short-term incentive compensation and evaluating performance on a basis comparable to that used by many in the investment community.

NOTE 2:  Certain financial information presented herein may not add due to rounding.

FBL Financial Group, Inc.
Consolidated Balance Sheets (Unaudited)
(Dollars in thousands)
	December 31,		December 31,
	2008		2007
Assets
Investments:
Fixed maturities - available for sale, at market (amortized cost:
2008 - $10,505,084; 2007 - $9,662,986)	$	8,965,443	$	9,522,592
Equity securities - available for sale, at market (cost: 2008 - $51,958;
2007 - $22,410)		44,863		23,633
Mortgage loans on real estate		1,381,854		1,221,573
Derivative instruments		12,933		43,918
Investment real estate		2,559		2,559
Policy loans		182,421		179,490
Other long-term investments		1,527		1,300
Short-term investments		262,459		72,005
Total investments		10,854,059		11,067,070
Cash and cash equivalents		37,710		84,015
Securities and indebtedness of related parties		18,921		19,957
Accrued investment income		136,893		118,827
Amounts receivable from affiliates		15,791		10,831
Reinsurance recoverable		107,854		123,659
Deferred policy acquisition costs		1,365,609		991,155
Deferred sales inducements		420,147		321,263
Value of insurance in force acquired		63,121		41,215
Property and equipment, less allowances for depreciation of $63,730 in 2008
and $75,365 in 2007		23,074		49,164
Current income tax recoverable		14,389		7,412
Deferred income tax benefit		305,080		-
Goodwill		11,170		11,170
Collateral held for securities lending and other transactions		67,953		186,925
Other assets		41,623		32,458
Assets held in separate accounts		577,420		862,738
Total assets	$	14,060,814	$	13,927,859

1

FBL Financial Group, Inc.
Consolidated Balance Sheets (Continued)
(Dollars in thousands)
	December 31,			December 31,
	2008			2007
Liabilities and stockholders' equity
Liabilities:
Policy liabilities and accruals:
Future policy benefits:
Interest sensitive and index products	$	10,531,967		$	9,557,073
Traditional life insurance and accident and health products		1,328,506			1,284,068
Unearned revenue reserve		34,663			28,448
Other policy claims and benefits		38,256			31,069
		11,933,392			10,900,658
Other policyholders' funds:
Supplementary contracts without life contingencies		504,885			439,441
Advance premiums and other deposits		167,473			158,245
Accrued dividends		10,241			11,208
		682,599			608,894
Amounts payable to affiliates		247			35
Short-term debt		59,446			-
Long-term debt payable to affiliates		100,000			-
Long-term debt		271,005			316,930
Deferred income taxes		-			28,188
Collateral payable for securities lending and other transactions		69,656			202,594
Other liabilities		108,588			104,840
Liabilities related to separate accounts		577,420			862,738
Total liabilities		13,802,353			13,024,877
Minority interest in subsidiaries		96			91
Stockholders’ equity:
Preferred stock, without par value, at liquidation value – authorized
10,000,000 shares, issued and outstanding 5,000,000 Series B shares		3,000			3,000
Class A common stock, without par value – authorized 88,500,000 shares,
issued and outstanding 28,975,889 shares in 2008 and 28,826,738
shares in 2007		104,090			101,221
Class B common stock, without par value – authorized 1,500,000 shares,
issued and outstanding 1,192,990 shares		7,522			7,525
Accumulated other comprehensive loss		(649,758	)		(36,345	)
Retained earnings		793,511			827,490
Total stockholders’ equity		258,365			902,891
Total liabilities and stockholders’ equity	$	14,060,814		$	13,927,859

2

FBL Financial Group, Inc.
Consolidated Statements of Operations (Unaudited)
(Dollars in thousands, except per share data)
			Three months ended December 31,						Year ended December 31,
			2008			2007			2008			2007
Revenues:
	Interest sensitive and index product charges		$	33,362		$	30,484		$	127,199		$	114,529
	Traditional life insurance premiums			38,002			36,419			149,186			144,682
	Net investment income			185,317			166,471			707,872			628,031
	Derivative loss			(37,261	)		(52,227	)		(208,793	)		(4,951	)
	Realized/unrealized gains (losses) on investments			(25,785	)		(775	)		(156,309	)		5,769
	Other income			5,945			6,484			25,310			26,539
		Total revenues		199,580			186,856			644,465			914,599
Benefits and expenses:
	Interest sensitive and index product benefits			120,118			105,144			440,430			442,544
	Change in value of index product embedded derivatives			(18,334	)		(12,334	)		(189,354	)		(5,907	)
	Traditional life insurance benefits			23,677			21,132			96,884			90,808
	Increase in traditional life future policy benefits			9,744			9,613			43,255			37,682
	Distributions to participating policyholders			4,958			5,306			20,064			21,420
	Underwriting, acquisition and insurance expenses			77,034			31,978			221,393			161,820
	Interest expense			6,204			4,430			19,567			16,666
	Other expenses			6,427			6,389			24,104			23,760
		Total benefits and expenses		229,828			171,658			676,343			788,793
				(30,248	)		15,198			(31,878	)		125,806
Income taxes				11,028			(3,800	)		13,662			(41,051	)
Minority interest in loss of subsidiaries				40			52			71			49
Equity income (loss), net of related income taxes				(48	)		433			(4	)		1,535
Net income (loss)			$	(19,228	)	$	11,883		$	(18,149	)	$	86,339
Earnings (loss) per common share			$	(0.64	)	$	0.40		$	(0.61	)	$	2.90
Earnings (loss) per common share – assuming dilution			$	(0.64	)	$	0.39		$	(0.61	)	$	2.84
Cash dividends per common share			$	0.125		$	0.120		$	0.500		$	0.480

3

FBL Financial Group, Inc.
Consolidated Statements of Operating Income (Loss)
(Dollars in thousands, except per share data)
	Q4 2007			Q1 2008			Q2 2008			Q3 2008			Q4 2008
Operating revenues:
Interest sensitive and index product charges	$	30,492		$	29,206		$	31,893		$	32,908		$	33,350
Traditional life insurance premiums		36,419			36,133			38,769			36,282			38,002
Net investment income		166,471			168,494			172,173			181,888			185,317
Derivative income (loss)		8,937			(17,926	)		(22,155	)		(24,610	)		(30,401	)
Other income		6,484			5,865			6,955			6,545			5,945
Total operating revenues		248,803			221,772			227,635			233,013			232,213
Benefits and expenses:
Interest sensitive and index product benefits		118,064			99,147			100,766			106,454			114,096
Traditional life insurance		21,132			27,252			22,602			23,353			23,677
Increase in traditional life future policy benefits		9,613			11,390			11,037			11,084			9,744
Distributions to participating policyholders		5,306			5,270			5,023			4,813			4,958
Underwriting, acquisition and insurance expenses:
Commission expense, net of deferrals		3,398			3,401			3,348			3,280			3,581
Amortization of deferred policy acquisition costs		24,025			22,436			22,805			26,706			51,911
Amortization of value of insurance in force acquired		2,068			1,055			569			857			1,044
Other underwriting expenses		19,160			19,369			19,313			18,928			19,353
Total underwriting, acquisition and insurance expenses		48,651			46,261			46,035			49,771			75,889
Interest expense		4,430			4,451			4,448			4,464			6,204
Other expenses		6,389			5,955			6,137			5,585			6,426
Total benefits and expenses		213,585			199,726			196,048			205,524			240,994
		35,218			22,046			31,587			27,489			(8,781	)
Income taxes		(10,807	)		(7,104	)		(10,307	)		(8,918	)		3,513
Minority interest in loss of subsidiaries		52			9			7			15			40
Equity income (loss), net of related income taxes		433			117			(159	)		86			(48	)
Operating income (loss)		24,896			15,068			21,128			18,672			(5,276	)
Realized/unrealized losses on investments, net of offsets		(213	)		(12,165	)		(42,642	)		(12,726	)		(12,009	)
Change in net unrealized gains/losses on derivatives, net of offsets		(12,800	)		3,535			4,939			5,270			(1,943	)
Net income (loss)	$	11,883		$	6,438		$	(16,575	)	$	11,216		$	(19,228	)
Operating income (loss) per common share - assuming dilution.	$	0.82		$	0.50		$	0.70		$	0.62		$	(0.18	)
Earnings (loss) per common share - assuming dilution	$	0.39		$	0.21		$	(0.56	)	$	0.37		$	(0.64	)
Weighted average common shares outstanding, operating income (loss) basis (in thousands):
Basic		29,787			29,860			29,892			29,900			29,926
Effect of dilutive securities		626			348			210			151			-
Diluted		30,413			30,208			30,102			30,051			29,926
Weighted average common shares outstanding, net income (loss) basis (in thousands):
Basic		29,787			29,860			29,892			29,900			29,926
Effect of dilutive securities		626			348			-			151			-
Diluted		30,413			30,208			29,892			30,051			29,926
Operating return on equity, excluding AOCL - last twelve months		10.6	%		9.6	%		9.2	%		8.6	%		5.3	%
Operating return on equity, including AOCL - last twelve months		10.7	%		10.1	%		10.2	%		10.2	%		7.6	%

4

FBL Financial Group, Inc.

Segment Information

We analyze operations by reviewing financial information regarding products that are aggregated into four product segments.  The product segments are (1) Traditional Annuity - Exclusive Distribution ("Exclusive Annuity"), (2) Traditional Annuity - Independent Distribution ("Independent Annuity"), (3) Traditional and Universal Life Insurance and (4) Variable.  We also have various support operations and corporate capital that are aggregated into the Corporate and Other segment.

The Exclusive Annuity segment primarily consists of fixed rate annuities and supplementary contracts (some of which involve life contingencies) sold through our exclusive agency distribution.  Fixed rate annuities provide for tax-deferred savings and supplementary contracts provide for the systematic repayment of funds that accumulate interest.  Fixed rate annuities consist primarily of flexible premium deferred annuities, but also include single premium deferred and immediate contracts. With fixed rate annuities, we bear the underlying investment risk and credit interest to the contracts at rates we determine, subject to interest rate guarantees.  The Exclusive Annuity segment also includes index annuities.  With index annuity products, we bear the underlying investment risk and credit interest in an amount equal to a percentage of the gain in a specified market index, subject to minimum guarantees.

The Independent Annuity segment consists of fixed rate and index annuities and supplementary contracts (some of which involve life contingencies) sold through our independent distribution or assumed through coinsurance agreements.

The Traditional and Universal Life Insurance segment consists of whole life, term life and universal life policies.  These policies provide benefits upon the death of the insured and may also allow the customer to build cash value on a tax-deferred basis.

The Variable segment consists of variable universal life insurance and variable annuity contracts.  These products are similar to universal life insurance and traditional annuity contracts, except the contract holder has the option to direct the cash value of the contract to a wide range of investment sub-accounts, thereby passing the investment risk to the contract holder.

The Corporate and Other segment consists of the following corporate items and products/services that do not meet the quantitative threshold for separate segment reporting:

 -  investments and related investment income not specifically allocated to our product segments;                       

 -  interest expense;                                                                                                   

 -  accident and health insurance products, primarily a closed block of group policies;                                 

 -  advisory services for the management of investments and other companies;                                            

 -  marketing and distribution services for the sale of mutual funds and insurance products not issued by us; and 

 -  leasing services, primarily with affiliates.                                                                        

We analyze our segment results based on pre-tax operating income (loss).  Accordingly, income taxes are not allocated to the segments.  In addition, operating results are generally reported net of any transactions between the segments.  

5

FBL Financial Group, Inc.
Consolidating Statements of Pre-tax Operating Income (Loss)
Quarter Ended December 31, 2008	Traditional			Traditional			Traditional
	Annuity -			Annuity -			& Universal						Corporate
	Exclusive			Independent			Life Insurance			Variable			& Other			Consolidated
	(Dollars in thousands)
Operating revenues:
Interest sensitive and index product charges	$	338		$	8,783		$	12,256		$	11,973		$	-		$	33,350
Traditional life insurance premiums		-			-			38,002			-			-			38,002
Net investment income		37,467			106,483			35,795			3,713			1,859			185,317
Derivative loss		(663	)		(29,738	)		-			-			-			(30,401	)
Other income		104			-			(21	)		416			5,446			5,945
Total operating revenues		37,246			85,528			86,032			16,102			7,305			232,213
Benefits and expenses:
Interest sensitive and index product benefits		23,573			68,003			16,168			6,352			-			114,096
Traditional life insurance benefits		-			-			23,677			-			-			23,677
Increase in traditional life future policy benefits		-			-			9,744			-			-			9,744
Distributions to participating policyholders		-			-			4,958			-			-			4,958
Underwriting, acquisition and insurance expenses:
Commission expense, net of deferrals		-			-			2,831			750			-			3,581
Amortization of deferred policy acquisition costs		3,700			35,763			5,041			7,407			-			51,911
Amortization of value of insurance in force acquired		612			-			432			-			-			1,044
Other underwriting expenses		2,136			3,630			7,590			5,404			593			19,353
Total underwriting, acquisition and insurance expenses		6,448			39,393			15,894			13,561			593			75,889
Interest expense		-			-			-			-			6,204			6,204
Other expenses		-			-			-			111			6,315			6,426
Total benefits and expenses		30,021			107,396			70,441			20,024			13,112			240,994
		7,225			(21,868	)		15,591			(3,922	)		(5,807	)		(8,781	)
Minority interest in loss of subsidiaries		-			-			-			-			40			40
Equity loss, before tax		-			-			-			-			(74	)		(74	)
Pre-tax operating income (loss)	$	7,225		$	(21,868	)	$	15,591		$	(3,922	)	$	(5,841	)	$	(8,815	)
Quarter Ended December 31, 2007	Traditional			Traditional			Traditional
	Annuity -			Annuity -			& Universal						Corporate
	Exclusive			Independent			Life Insurance			Variable			& Other			Consolidated
	(Dollars in thousands)
Operating revenues:
Interest sensitive and index product charges	$	259		$	6,399		$	11,457		$	12,377		$	-		$	30,492
Traditional life insurance premiums		-			-			36,419			-			-			36,419
Net investment income		36,861			86,230			35,749			3,352			4,279			166,471
Derivative income		899			8,038			-			-			-			8,937
Other income		-			-			-			201			6,283			6,484
Total operating revenues		38,019			100,667			83,625			15,930			10,562			248,803
Benefits and expenses:
Interest sensitive and index product benefits		24,563			74,721			14,238			4,542			-			118,064
Traditional life insurance benefits		-			-			21,132			-			-			21,132
Increase in traditional life future policy benefits		-			-			9,613			-			-			9,613
Distributions to participating policyholders		-			-			5,306			-			-			5,306
Underwriting, acquisition and insurance expenses:
Commission expense, net of deferrals		43			42			2,461			852			-			3,398
Amortization of deferred policy acquisition costs		2,111			13,339			5,555			3,020			-			24,025
Amortization of value of insurance in force acquired		311			-			1,757			-			-			2,068
Other underwriting expenses		2,219			3,103			7,603			5,238			997			19,160
Total underwriting, acquisition and insurance expenses		4,684			16,484			17,376			9,110			997			48,651
Interest expense		-			-			-			-			4,430			4,430
Other expenses		-			-			-			176			6,213			6,389
Total benefits and expenses		29,247			91,205			67,665			13,828			11,640			213,585
		8,772			9,462			15,960			2,102			(1,078	)		35,218
Minority interest in loss of subsidiaries		-			-			-			-			52			52
Equity income, before tax		-			-			-			-			666			666
Pre-tax operating income (loss)	$	8,772		$	9,462		$	15,960		$	2,102		$	(360	)	$	35,936

6

FBL Financial Group, Inc.
Statements of Pre-tax Operating Income
Traditional Annuity - Exclusive Distribution Segment
	Q4 2007			Q1 2008			Q2 2008			Q3 2008			Q4 2008
Pre-tax Operating Income							(Dollars in thousands)
Operating revenues:
Interest sensitive and index product charges	$	259		$	265		$	201		$	190		$	338
Net investment income		36,861			35,538			35,670			36,634			37,467
Derivative income (loss):
Proceeds from option settlements		165			73			-			-			-
Cost of money for call options		(98	)		(94	)		(113	)		(102	)		(93	)
Proceeds from (cost of) interest rate swaps		832			(112	)		(869	)		(979	)		(570	)
Total derivative income (loss)		899			(133	)		(982	)		(1,081	)		(663	)
Other income		-			26			114			23			104
Total operating revenues		38,019			35,696			35,003			35,766			37,246
Benefits and expenses:
Interest sensitive and index product benefits		24,563			23,287			23,051			23,904			23,573
Underwriting, acquisition and insurance expenses:
Amortization of deferred policy acquisition costs		2,111			2,482			2,142			3,624			3,698
Amortization of value of insurance in force acquired		311			534			74			292			612
Other underwriting expenses		2,262			2,151			2,122			2,081			2,138
Total underwriting, acquisition and insurance expenses		4,684			5,167			4,338			5,997			6,448
Total benefits and expenses		29,247			28,454			27,389			29,901			30,021
Pre-tax operating income	$	8,772		$	7,242		$	7,614		$	5,865		$	7,225
Balance sheet data, securities at cost:
Assets:
Investments	$	2,315,044		$	2,350,332		$	2,364,870		$	2,417,666		$	2,356,310
Deferred policy acquisition costs		80,685			84,023			87,211			88,865			89,714
Value of insurance in force acquired		12,949			12,509			12,761			12,265			11,982
Other assets		51,155			50,485			67,063			64,513			135,170
Total assets	$	2,459,833		$	2,497,349		$	2,531,905		$	2,583,309		$	2,593,176
Liabilities and equity:
Liabilities:
Interest sensitive and index product reserves	$	1,825,325		$	1,842,844		$	1,887,174		$	1,943,188		$	1,971,218
Other insurance reserves		392,326			394,576			389,471			387,176			381,838
Other liabilities		15,362			36,711			27,407			24,514			19,626
Total liabilities		2,233,013			2,274,131			2,304,052			2,354,878			2,372,682
Allocated equity, excluding AOCL		226,820			223,218			227,853			228,431			220,494
Total liabilities and equity	$	2,459,833		$	2,497,349		$	2,531,905		$	2,583,309		$	2,593,176
Other data:
Number of direct contracts		51,311			50,926			50,912			51,258			51,439
Statutory portfolio yield net of assumed defaults		6.05	%		5.75	%		5.76	%		5.83	%		5.61	%
Credited rate		4.35	%		4.14	%		4.13	%		4.12	%		4.04	%
Spread on direct fixed annuities at end of quarter		1.70	%		1.61	%		1.63	%		1.71	%		1.57	%
Interest sensitive and index product reserve activity:
Individual deferred annuity reserve:
Balance, beginning of period	$	1,439,049		$	1,442,520		$	1,457,812		$	1,499,540		$	1,554,250
Deposits		24,045			43,164			61,848			68,871			62,278
Withdrawals, surrenders and death benefits		(22,659	)		(24,090	)		(20,481	)		(18,710	)		(32,827	)
Net flows		1,386			19,074			41,367			50,161			29,451
Policyholder interest/index credits		15,382			14,897			14,701			15,221			15,211
Annuitizations and other		(13,297	)		(18,679	)		(14,340	)		(10,672	)		(12,771	)
Balance, end of period		1,442,520			1,457,812			1,499,540			1,554,250			1,586,141
Other interest sensitive reserves		382,805			385,032			387,634			388,938			385,077
Total interest sensitive and index product reserves	$	1,825,325		$	1,842,844		$	1,887,174		$	1,943,188		$	1,971,218

7

FBL Financial Group, Inc.
Statements of Pre-tax Operating Income (Loss)
Traditional Annuity - Independent Distribution Segment
	Q4 2007			Q1 2008			Q2 2008			Q3 2008			Q4 2008
Pre-tax Operating Income (Loss)	(Dollars in thousands)
Operating revenues:
Interest sensitive and index product charges	$	6,399		$	5,309		$	7,621		$	8,754		$	8,783
Net investment income		86,230			90,766			94,605			103,273			106,483
Derivative income (loss):
Proceeds from option settlements		38,717			14,341			11,734			8,903			902
Cost of money for call options		(30,679	)		(32,134	)		(32,907	)		(32,432	)		(30,640	)
Total derivative income (loss)		8,038			(17,793	)		(21,173	)		(23,529	)		(29,738	)
Total operating revenues		100,667			78,282			81,053			88,498			85,528
Benefits and expenses:
Interest sensitive and index product benefits:
Interest sensitive product benefits		23,222			25,430			26,681			32,889			35,354
Index product benefits:
Interest credited		12,034			13,579			17,199			17,479			30,633
Index credits		39,465			14,525			10,774			8,154			2,016
Total index product benefits		51,499			28,104			27,973			25,633			32,649
Total interest sensitive and index product benefits		74,721			53,534			54,654			58,522			68,003
Underwriting, acquisition and insurance expenses:
Amortization of deferred policy acquisition costs		13,339			13,011			13,745			15,695			35,764
Other underwriting expenses		3,145			3,942			3,760			3,742			3,629
Total underwriting, acquisition and insurance expenses		16,484			16,953			17,505			19,437			39,393
Total benefits and expenses		91,205			70,487			72,159			77,959			107,396
Pre-tax operating income (loss)	$	9,462		$	7,795		$	8,894		$	10,539		$	(21,868	)
Balance sheet data, securities at cost:
Assets:
Investments	$	6,249,207		$	6,393,489		$	6,817,989		$	7,187,159		$	7,202,047
Deferred policy acquisition costs		468,529			478,708			492,540			501,711			479,288
Deferred sales inducements		286,849			292,491			294,148			293,524			277,836
Other assets		142,582			167,015			188,946			155,091			157,133
Total assets	$	7,147,167		$	7,331,703		$	7,793,623		$	8,137,485		$	8,116,304
Liabilities and equity:
Liabilities:
Interest sensitive and index product reserves - direct	$	4,994,736		$	5,172,016		$	5,602,285		$	5,961,338		$	5,979,633
Interest sensitive and index product reserves - assumed		1,766,735			1,719,151			1,678,348			1,628,748			1,583,754
Other insurance reserves		64,242			89,362			113,368			138,950			145,036
Other liabilities		21,034			36,972			58,575			29,379			28,658
Total liabilities		6,846,747			7,017,501			7,452,576			7,758,415			7,737,081
Allocated equity, excluding AOCL		300,420			314,202			341,047			379,070			379,223
Total liabilities and equity	$	7,147,167		$	7,331,703		$	7,793,623		$	8,137,485		$	8,116,304
Other data:
Number of direct contracts		73,980			78,241			86,470			92,966			93,769
Fixed rate annuitites:
Statutory portfolio yield net of assumed defaults		5.80	%		5.83	%		5.85	%		5.89	%		5.89	%
Credited rate		4.86	%		4.85	%		4.86	%		4.88	%		4.89	%
Spread on direct fixed rate annuities at end of quarter		0.94	%		0.98	%		0.99	%		1.01	%		1.00	%
Index annutities:
Statutory portfolio yield net of assumed defaults		5.74	%		5.77	%		5.81	%		5.83	%		5.83	%
Credited rate/option cost		3.57	%		3.56	%		3.53	%		3.46	%		3.54	%
Spread on direct index annuities at end of quarter		2.17	%		2.21	%		2.28	%		2.37	%		2.29	%
Interest sensitive and index product reserve activity:
Individual deferred annuity reserve:
Balance, beginning of period	$	6,330,502		$	6,759,976		$	6,889,613		$	7,279,099		$	7,588,549
Deposits		485,878			303,676			512,448			467,069			187,024
Withdrawals, surrenders and death benefits		(130,841	)		(134,517	)		(151,351	)		(181,175	)		(251,863	)
Net flows		355,037			169,159			361,097			285,894			(64,839	)
Policyholder interest/index credits		86,470			63,945			58,804			61,130			56,490
Derivative value change and other		(12,033	)		(103,467	)		(30,415	)		(37,574	)		(18,511	)
Balance, end of period		6,759,976			6,889,613			7,279,099			7,588,549			7,561,689
Other interest sensitive reserves		1,495			1,554			1,534			1,537			1,698
Total interest sensitive and index product reserves	$	6,761,471		$	6,891,167		$	7,280,633		$	7,590,086		$	7,563,387

8

	FBL Financial Group, Inc.
	Statements of Pre-tax Operating Income
	Traditional and Universal Life Insurance Segment
		Q4 2007			Q1 2008			Q2 2008			Q3 2008			Q4 2008
Pre-tax Operating Income		(Dollars in thousands, except face amounts in millions)
Operating revenues:
	Interest sensitive product charges	$	11,457		$	11,421		$	11,781		$	12,229		$	12,256
	Traditional life insurance premiums		36,419			36,133			38,769			36,282			38,002
	Net investment income		35,749			35,787			35,682			36,060			35,795
	Other income		-			21			(14	)		(19	)		(21	)
Total operating revenues			83,625			83,362			86,218			84,552			86,032
Benefits and expenses:
	Interest sensitive product benefits:
	Interest credited		9,146			9,140			9,208			9,230			9,092
	Death benefits		5,092			7,245			8,106			7,955			7,076
	Total interest sensitive product benefits		14,238			16,385			17,314			17,185			16,168
	Traditional life insurance benefits:
	Death benefits		12,582			18,433			12,510			14,747			14,885
	Surrender and other benefits		8,550			8,819			10,092			8,606			8,792
	Total traditional life insurance benefits		21,132			27,252			22,602			23,353			23,677
	Increase in traditional life future policy benefits		9,613			11,390			11,037			11,084			9,744
	Distributions to participating policyholders		5,306			5,270			5,023			4,813			4,958
	Underwriting, acquisition and insurance expenses:
	Commission expense, net of deferrals		2,461			2,579			2,461			2,520			2,831
	Amortization of deferred policy acquisition costs		5,555			4,446			4,291			4,378			5,041
	Amortization of value of insurance in force acquired		1,757			521			495			565			432
	Other underwriting expenses		7,603			7,355			7,330			7,014			7,590
	Total underwriting, acquisition and insurance expenses		17,376			14,901			14,577			14,477			15,894
Total benefits and expenses			67,665			75,198			70,553			70,912			70,441
Pre-tax operating income		$	15,960		$	8,164		$	15,665		$	13,640		$	15,591
Balance sheet data, securities at cost:
Assets:
	Investments	$	2,216,803		$	2,228,639		$	2,247,695		$	2,254,593		$	2,266,936
	Deferred policy acquisition costs		230,399			233,127			237,004			240,182			245,020
	Deferred sales inducements		3,806			3,861			4,104			4,237			5,582
	Value of insurance in force acquired		27,642			27,182			26,763			26,348			25,904
	Other assets		66,256			78,837			82,331			87,204			76,235
Total assets		$	2,544,906		$	2,571,646		$	2,597,897		$	2,612,564		$	2,619,677
Liabilities and equity:
	Liabilities:
	Interest sensitive reserves	$	768,066		$	768,141		$	769,503		$	770,527		$	771,823
	Other insurance reserves		1,400,379			1,416,311			1,430,396			1,442,609			1,455,515
	Other liabilities		66,566			65,445			62,681			66,038			88,361
	Total liabilities		2,235,011			2,249,897			2,262,580			2,279,174			2,315,699
	Allocated equity, excluding AOCL		309,895			321,749			335,317			333,390			303,978
Total liabilities and equity		$	2,544,906		$	2,571,646		$	2,597,897		$	2,612,564		$	2,619,677
	Other data:
	Number of direct policies - traditional life		332,494			332,538			332,545			333,723			335,505
	Number of direct policies - universal life		55,218			54,787			54,834			54,648			55,094
	Direct face amounts - traditional life	$	28,551		$	29,088		$	29,519		$	30,241		$	30,998
	Direct face amounts - universal life	$	4,695		$	4,684		$	4,733		$	4,753		$	4,817
	Statutory portfolio yield net of assumed defaults		6.32	%		6.30	%		6.34	%		6.34	%		6.30	%
	Credited rate		4.40	%		4.40	%		4.40	%		4.41	%		4.41	%
	Spread on direct universal life at end of quarter		1.92	%		1.90	%		1.94	%		1.93	%		1.89	%
Interest sensitive reserve activity:
	Balance, beginning of period	$	766,769		$	768,066		$	768,141		$	769,503		$	770,527
	Deposits		14,079			13,395			14,140			13,606			15,013
	Withdrawals and surrenders		(7,539	)		(7,439	)		(8,066	)		(7,214	)		(8,423	)
	Net flows		6,540			5,956			6,074			6,392			6,590
	Policyholder interest credited		8,604			8,286			8,406			8,373			8,225
	Policy charges		(11,328	)		(11,263	)		(11,560	)		(11,790	)		(12,042	)
	Benefits and other		(2,519	)		(2,904	)		(1,558	)		(1,951	)		(2,016	)
	Balance, end of period		768,066			768,141			769,503			770,527			771,284
Other interest sensitive reserves			-			-			-			-			539
Total interest sensitive reserves		$	786,066		$	768,141		$	769,503		$	770,527		$	771,823

9

			FBL Financial Group, Inc.
			Statements of Pre-tax Operating Income (Loss)
			Variable Segment
				Q4 2007			Q1 2008			Q2 2008			Q3 2008			Q4 2008
Pre-tax Operating Income (Loss)				(Dollars in thousands, except face amounts in millions)
Operating revenues:
	Interest sensitive product charges:
			Variable universal life product charges	$	9,936		$	9,913		$	9,924		$	9,550		$	10,187
			Variable annuity product charges		2,441			2,298			2,366			2,185			1,786
	Total interest sensitive product charges				12,377			12,211			12,290			11,735			11,973
	Net investment income				3,352			3,341			3,638			3,565			3,713
	Other income				201			383			633			486			416
Total operating revenues					15,930			15,935			16,561			15,786			16,102
Benefits and expenses:
	Interest sensitive product benefits:
			Interest credited		2,003			2,217			1,810			2,048			2,522
			Death benefits		2,539			3,724			3,937			4,795			3,830
	Total interest sensitive product benefits				4,542			5,941			5,747			6,843			6,352
			Underwriting, acquisition and insurance expenses:
			Commission expense, net of deferrals		852			822			790			760			750
			Amortization of deferred policy acquisition costs		3,020			2,497			2,627			3,009			7,408
			Other underwriting expenses		5,238			5,304			5,543			5,508			5,403
			Total underwriting, acquisition and insurance expenses		9,110			8,623			8,960			9,277			13,561
			Other expenses		176			203			174			176			111
Total benefits and expenses					13,828			14,767			14,881			16,296			20,024
Pre-tax operating income (loss)				$	2,102		$	1,168		$	1,680		$	(510	)	$	(3,922	)
Balance sheet data, securities at cost:
Assets:
	Investments			$	215,176		$	224,408		$	242,537		$	221,131		$	242,222
	Deferred policy acquisition costs				156,055			156,980			157,825			157,849			153,396
	Deferred sales inducements				2,369			2,379			2,449			2,449			2,572
	Other assets				11,539			15,909			10,329			15,454			9,262
	Separate account assets				862,738			802,225			794,846			718,501			577,420
Total assets				$	1,247,877		$	1,201,901		$	1,207,986		$	1,115,384		$	984,872
Liabilities and equity:
	Liabilities:
		Interest sensitive reserves		$	202,211		$	204,965		$	208,607		$	216,715		$	225,539
		Other insurance reserves			26,985			28,596			28,964			32,623			30,382
		Other liabilities			39,290			38,249			70,265			33,221			32,067
		Separate account liabilities			862,738			802,225			794,846			718,501			577,420
	Total liabilities				1,131,224			1,074,035			1,102,682			1,001,060			865,408
	Allocated equity, excluding AOCL				116,653			127,866			105,304			114,324			119,464
Total liabilities and equity				$	1,247,877		$	1,201,901		$	1,207,986		$	1,115,384		$	984,872
Rollforward of separate account balances:
Beginning separate account balance				$	865,557		$	862,738		$	802,225		$	794,846		$	718,501
	Net premiums				35,594			27,019			28,398			15,721			7,507
	Net investment loss				(14,608	)		(61,229	)		(8,707	)		(67,251	)		(127,551	)
	Charges, benefits and surrenders				(23,805	)		(26,303	)		(27,070	)		(24,815	)		(21,037	)
Ending separate account balance				$	862,738		$	802,225		$	794,846		$	718,501		$	577,420
Separate account balance:
Balance per financial statements				$	862,738		$	802,225		$	794,846		$	718,501		$	577,420
Less: alliance partners' share					(22,301	)		(20,932	)		(19,934	)		(17,635	)		(13,940	)
Add: alliance partner separate account assets on business assumed					79,150			79,212			76,143			67,685			53,614
				$	919,587		$	860,505		$	851,055		$	768,551		$	617,094
Other data:
Number of direct contracts - variable annuity					21,041			21,025			21,072			20,856			20,624
Number of direct policies - variable universal life					63,378			62,858			62,381			61,861			61,319
Direct face amounts - variable universal life				$	7,846		$	7,804		$	7,797		$	7,756		$	7,698

10

FBL Financial Group, Inc.
Statements of Pre-tax Operating Loss
Corporate and Other Segment
	Q4 2007			Q1 2008			Q2 2008			Q3 2008			Q4 2008
Pre-tax Operating Loss	(Dollars in thousands)
Operating revenues:
Net investment income	$	4,279		$	3,062		$	2,578		$	2,356		$	1,859
Other income		6,283			5,435			6,222			6,055			5,446
Total operating revenues		10,562			8,497			8,800			8,411			7,305
Benefits and expenses:
Other underwriting and insurance expenses		997			617			655			583			593
Interest expense		4,430			4,451			4,448			4,464			6,204
Other expenses		6,213			5,752			5,963			5,409			6,315
Total benefits and expenses		11,640			10,820			11,066			10,456			13,112
		(1,078	)		(2,323	)		(2,266	)		(2,045	)		(5,807	)
Minority interest in loss of subsidiaries		52			9			7			15			40
Equity income, before tax		666			180			(245	)		132			(74	)
Pre-tax operating loss	$	(360	)	$	(2,134	)	$	(2,504	)	$	(1,898	)	$	(5,841	)
Balance sheet data, securities at cost:
Assets:
Investments	$	280,864		$	188,101		$	153,796		$	146,690		$	333,281
Securities and indebtedness of related parties		19,954			20,040			19,602			19,108			18,919
Other assets		426,436			451,908			317,675			315,941			245,271
Total assets	$	727,254		$	660,049		$	491,073		$	481,739		$	597,471
Liabilities and equity:
Liabilities:
Insurance reserves	$	68,360		$	68,710		$	66,874		$	66,283		$	64,319
Debt		316,930			316,949			316,967			350,986			430,451
Other liabilities		356,423			316,923			191,243			186,532			217,637
Total liabilities		741,713			702,582			575,084			603,801			712,407
Minority interest in subsidiaries		91			129			130			122			96
Equity, excluding AOCL		(14,550	)		(42,662	)		(84,141	)		(122,184	)		(115,032	)
Total liabilities and equity	$	727,254		$	660,049		$	491,073		$	481,739		$	597,471

11

FBL Financial Group, Inc.
Deferred Policy Acquisition Costs by Segment
	Q4 2007			Q1 2008			Q2 2008			Q3 2008			Q4 2008
	(Dollars in thousands)
Traditional Annuity - Exclusive Distribution
Deferred policy acquisition costs - beginning of period	$	79,556		$	80,685		$	84,023		$	87,211		$	88,865
Capitalization:
Commissions		1,844			2,774			2,798			2,532			2,573
Expenses		303			720			657			786			835
Total capitalization		2,147			3,494			3,455			3,318			3,408
Amortization - operating basis, before impact of unlocking		(2,111	)		(2,482	)		(2,142	)		(3,026	)		(3,698	)
Amortization - unlocking, operating basis		-			-			-			(598	)		-
Amortization - realized gains/losses on investments and
unrealized gains/losses on derivatives		1,093			2,326			1,875			1,960			1,139
Deferred policy acquisition costs - end of period	$	80,685		$	84,023		$	87,211		$	88,865		$	89,714
Traditional Annuity - Independent Distribution
Deferred policy acquisition costs - beginning of period	$	433,409		$	468,529		$	478,708		$	492,540		$	501,711
Capitalization:
Commissions		31,001			24,478			29,263			26,412			14,879
Expenses		2,176			1,931			2,165			2,043			1,566
Total capitalization		33,177			26,409			31,428			28,455			16,445
Amortization - operating basis, before impact of unlocking		(13,339	)		(13,011	)		(14,453	)		(15,695	)		(19,414	)
Amortization - unlocking, operating basis		-			-			708			-			(16,350	)
Amortization - realized gains/losses on investments and
unrealized gains/losses on derivatives		15,282			(3,219	)		(3,851	)		(3,589	)		(3,104	)
Deferred policy acquisition costs - end of period	$	468,529		$	478,708		$	492,540		$	501,711		$	479,288
Traditional & Universal Life Insurance
Deferred policy acquisition costs - beginning of period	$	227,267		$	230,399		$	233,127		$	237,004		$	240,182
Capitalization:
Commissions		4,828			2,960			4,017			3,536			5,222
Expenses		3,850			3,818			3,722			3,531			4,669
Total capitalization		8,678			6,778			7,739			7,067			9,891
Amortization - operating basis, before impact of unlocking		(5,555	)		(4,446	)		(4,464	)		(3,850	)		(5,041	)
Amortization - unlocking, operating basis		-			-			173			(528	)		-
Amortization - realized gains/losses on investments		9			396			429			489			(12	)
Deferred policy acquisition costs - end of period	$	230,399		$	233,127		$	237,004		$	240,182		$	245,020
Variable
Deferred policy acquisition costs - beginning of period	$	154,059		$	156,055		$	156,980		$	157,825		$	157,849
Capitalization:
Commissions		3,765			2,618			2,528			1,920			1,728
Expenses		969			893			755			825			714
Total capitalization		4,734			3,511			3,283			2,745			2,442
Amortization - operating basis, before impact of unlocking		(4,277	)		(2,497	)		(2,925	)		(4,954	)		(7,408	)
Amortization - unlocking, operating basis		1,257			-			298			1,945			-
Amortization - realized gains/losses on investments and
unrealized gains/losses on derivatives		282			(89	)		189			288			513
Deferred policy acquisition costs - end of period	$	156,055		$	156,980		$	157,825		$	157,849		$	153,396
Total
Deferred policy acquisition costs - beginning of period	$	894,291		$	935,668		$	952,838		$	974,580		$	988,607
Capitalization:
Commissions		41,438			32,830			38,606			34,400			24,402
Expenses		7,298			7,362			7,299			7,185			7,784
Total capitalization		48,736			40,192			45,905			41,585			32,186
Amortization - operating basis, before impact of unlocking		(25,282	)		(22,436	)		(23,984	)		(27,525	)		(35,561	)
Amortization - unlocking, operating basis		1,257			-			1,179			819			(16,350	)
Amortization - realized gains/losses on investments and
unrealized gains/losses on derivatives		16,666			(586	)		(1,358	)		(852	)		(1,464	)
Deferred policy acquisition costs - end of period		935,668			952,838			974,580			988,607			967,418
Impact of unrealized gains/losses on investments		55,487			136,506			186,953			279,825			398,191
Deferred policy acquisition costs	$	991,155		$	1,089,344		$	1,161,533		$	1,268,432		$	1,365,609

12

FBL Financial Group, Inc.
Collected Premiums
						Q4 2007			Q1 2008			Q2 2008			Q3 2008			Q4 2008
						(Dollars in thousands)
Traditional Annuity - Exclusive Distribution
	First year - individual					$	14,966		$	25,530		$	40,234		$	55,649		$	49,262
	Renewal - individual						9,335			18,115			22,203			14,603			14,256
	Group						2,621			1,703			1,988			3,415			2,081
Total Traditional Annuity - Exclusive Distribution							26,922			45,348			64,425			73,667			65,599
Traditional Annuity - Independent Distribution
	Fixed rate annuities						283,563			120,928			378,209			348,886			67,820
	Index annuities						221,033			205,758			159,998			147,229			136,427
		Total direct					504,596			326,686			538,207			496,115			204,247
Reinsurance assumed							458			882			892			397			210
Total Traditional Annuity - Independent Distribution,
	net of reinsurance						505,054			327,568			539,099			496,512			204,457
Traditional and Universal Life Insurance
	Universal life:
		First year					2,045			1,361			1,628			1,879			1,804
		Renewal					9,920			9,919			10,271			9,167			9,981
			Total				11,965			11,280			11,899			11,046			11,785
	Participating whole life:
		First year					3,271			2,848			2,860			3,024			3,357
		Renewal					22,656			23,135			24,967			22,330			22,946
			Total				25,927			25,983			27,827			25,354			26,303
	Term life and other:
		First year					2,503			2,595			2,365			2,680			2,774
		Renewal					11,411			12,038			12,015			12,464			12,618
			Total				13,914			14,633			14,380			15,144			15,392
Total Traditional and Universal Life Insurance - Exclusive Distribution							51,806			51,896			54,106			51,544			53,480
Reinsurance assumed							2,905			2,735			2,790			2,692			2,696
Reinsurance ceded							(4,844	)		(4,637	)		(5,025	)		(4,457	)		(4,975	)
Total Traditional and Universal Life Insurance, net of reinsurance							49,867			49,994			51,871			49,779			51,201
Variable
	Variable annuities:
		Exclusive distribution:
			First year				19,254			13,217			12,394			9,340			5,791
			Renewal				6,036			6,682			6,919			4,962			4,484
				Total			25,290			19,899			19,313			14,302			10,275
		Alliance channel:
			First year (1)				7,480			6,385			4,398			3,046			1,856
			Renewal (1)				1,078			1,435			1,524			737			721
				Total			8,558			7,820			5,922			3,783			2,577
					Total variable annuities		33,848			27,719			25,235			18,085			12,852
	Variable universal life:
		Exclusive distribution:
			First year				2,039			1,756			1,118			1,200			856
			Renewal				11,302			11,936			12,033			11,209			11,096
				Total			13,341			13,692			13,151			12,409			11,952
		Alliance channel:
			First year (1)				152			122			96			115			82
			Renewal (1)				529			541			578			514			564
				Total			681			663			674			629			646
					Total variable universal life		14,022			14,355			13,825			13,038			12,598
Total Variable							47,870			42,074			39,060			31,123			25,450
Reinsurance ceded							(160	)		(153	)		(187	)		(180	)		(216	)
Total Variable, net of reinsurance							47,710			41,921			38,873			30,943			25,234
Corporate and Other
Accident and health premiums collected, net of
	reinsurance						234			63			30			27			258
						$	629,787		$	464,894		$	694,298		$	650,928		$	346,749
(1) Amounts are net of portion ceded to and include amounts assumed from alliance partners.

13

FBL Financial Group, Inc.
Other Income
				December 31,				March 31,				June 30,				September 30,				December 31,
				2007				2008				2008				2008				2008
				(Dollars in thousands, except per share data)
Capitalization:
	Senior Notes, due 2011			$	-			$	-			$	-			$	-			$	100,000
	Senior notes, due 2014				75,353				75,341				75,329				75,317				75,305
	Senior notes, due 2017				98,577				98,608				98,638				98,669				98,700
	Trust preferred securities				97,000				97,000				97,000				97,000				97,000
	Revolving line of credit agreement			$	46,000			$	46,000			$	46,000			$	60,000			$	59,446
	Short-term note payable				-				-				-				20,000				-
	Total debt				316,930				316,949				316,967				350,986				430,451
	Preferred stock				3,000				3,000				3,000				3,000				3,000
	Common stockholders' equity, excluding AOCL				936,236				941,372				922,375				930,031				905,123
	Total capitalization, excluding AOCL				1,256,166				1,261,321				1,242,342				1,284,017				1,338,574
	Accumulated other comprehensive income loss				(36,345	)			(137,996	)			(186,765	)			(377,151	)			(649,758	)
	Total capitalization, including AOCL			$	1,219,821			$	1,123,325			$	1,055,577			$	906,866			$	688,816
	Common shares outstanding				30,019,728				30,162,058				30,163,927				30,173,593				30,168,879
Book Value per Share:
	Excluding AOCL			$	31.19			$	31.21			$	30.58			$	30.82			$	30.00
	Including AOCL				29.98				26.64				24.39				18.32				8.46
Debt-to-Capital Ratio:
	Excluding AOCL				25.2		%		25.1		%		25.5		%		27.3		%		32.2		%
	Including AOCL				26.0				28.2				30.0				38.7				62.5
Debt-to-Capital Ratio with 100% Credit for Trust
	Preferred Securities:
	Excluding AOCL				17.5		%		17.4		%		17.7		%		19.8		%		24.9		%
	Including AOCL				18.0				19.6				20.8				28.0				48.4
Class A Common Ownership:
	Iowa Farm Bureau Federation				51.0		%		50.7		%		50.7		%		53.1		%		53.1		%
	Other Farm Bureau entities				9.0				8.9				8.7				8.7				8.7
	Public				40.0				40.4				40.6				38.2				38.2
					100.0		%		100.0		%		100.0		%		100.0		%		100.0		%
Quality of Fixed Income Securities:
	(AAA, AA, A)				63.6		%		62.0		%		61.7		%		61.7		%		60.0		%
	(BBB)				32.6				34.1				34.4				34.6				36.2
	(BB)				2.7				2.8				2.7				2.6				2.7
	(<BB)				1.1				1.1				1.2				1.1				1.1
Investment by Type:
	Fixed maturities				61.4		%		62.0		%		62.1		%		61.7		%		58.9		%
	Residential mortgage-backed				16.7				16.1				15.9				16.0				16.5
	Commercial mortgage-backed				5.1				5.9				6.5				6.5				5.9
	Asset-backed				2.3				1.8				1.5				1.4				1.3
	Mortgage loans				11.0				11.2				11.3				11.7				12.8
	Equity securities				0.2				0.2				0.1				0.1				0.4
	Other				3.3				2.8				2.6				2.6				4.2
Agent Strength Totals:
	Farm Bureau Life channel:
		8-state Farm Bureau Mutual channel			1,188				1,192				1,193				1,192				1,176
		7 Life-only states			779				763				775				789				786
			Total Farm Bureau Life channel		1,967				1,955				1,968				1,981				1,962
		Percentage registered representatives:
			Farm Bureau Life channel		88.3	%			88.6	%			86.9	%			86.4	%			83.9	%
	EquiTrust Life channel:
		Independent Agents			19,781				20,726				22,361				23,651				19,098

15