The transaction is subject to approval by Magnolia Guaranty’s shareholders, approvals by insurance regulators, completion of requisite due diligence and other customary closing conditions.
With assets of $8m and annual premiums of $2.14m, Magnolia Guaranty has 409,553 shares of capital stock outstanding. Since 1992, it has specialized in the sale of final expense and pre-need life insurance policies in Mississippi through its funeral home distribution channels.
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Citizens president, Rick Riley, said: "As we continue to grow the final expense and pre-need business, Magnolia Guaranty provides a natural synergy with our Security Plan Life Insurance Company subsidiary.
"These two companies complement one another very well, and together, serve to strengthen each other in the Mississippi marketplace."
The acquisition is expected to complete during the fourth quarter of 2013.
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