CITIZENS, INC. REPORTS 7.3% INCREASE IN EARNINGS

Austin, Texas -- March 28, 2003 -- Citizens, Inc. (NYSE: CIA), reported net income of $4.3 million or $0.14 per share for the year ended December 31, 2002, compared to net income of $4.0 million or $0.14 per share during the same period in 2001, an increase of 7.3%. Increased production of new business coupled with increased net investment income and the 2002 adoption of an accounting change whereby goodwill and intangible assets are no longer being amortized contributed to the increase in earnings. Had the accounting change been adopted in 2001, proforma 2001 net income would approximate $4.9 million or $0.17 per share. The per share earnings in 2002 were impacted by the issuance of approximately 1.1 million shares in two acquisitions during the year.

FOR FURTHER INFORMATION CONTACT:   
Joel H. Mathis, Vice President
Public Relations and Investor Relations

CITIZENS, INC. REPORTS 7.3% INCREASE IN EARNINGS

Austin, Texas -- March 28, 2003 -- Citizens, Inc. (NYSE: CIA), reported net income of $4.3 million or $0.14 per share for the year ended December 31, 2002, compared to net income of $4.0 million or $0.14 per share during the same period in 2001, an increase of 7.3%. Increased production of new business coupled with increased net investment income and the 2002 adoption of an accounting change whereby goodwill and intangible assets are no longer being amortized contributed to the increase in earnings. Had the accounting change been adopted in 2001, proforma 2001 net income would approximate $4.9 million or $0.17 per share. The per share earnings in 2002 were impacted by the issuance of approximately 1.1 million shares in two acquisitions during the year.

Revenues for the year increased 22.7% to $83.0 million in 2002 from $67.6 million in 2001. Premiums increased 26.4% to $68.2 million from $54.0 million in 2001 due to a 17.7% increase in the production of new life insurance premiums, measured in issued and paid annualized premiums, and the 2002 acquisition of Combined Underwriters Life Insurance Company (Combined) and Lifeline Underwriters Life Insurance Company (Lifeline) that contributed $10.7 million of premiums. Net investment income increased 7.2% during 2002 to $14.3 million from $13.3 million during 2001 due to continued expansion of the Companys asset base from organic growth, which was accelerated by the acquisitions that contributed approximately $500,000 to the increase. Total benefits and expenses for the year ended December 31, 2002, increased 23.7% to $77.5 million from $62.6 million in 2001. The acquisitions increased 2002 benefits and expenses by $10.4 million with the remaining increase primarily attributed to higher surrender activity.

Net income for the quarter ended December 31, 2002, was $1.4 million, or $0.04 per share, compared to $1.5 million, or $0.05 per share, for the same period in 2001. The 2002 earnings per share were negatively impacted by the issuance of 1.1 million shares in the acquisition transaction described above. Increased benefits and expenses in excess of premium and investment income growth were the primary causes of the decline in fourth quarter 2002 earnings. Had the above-described accounting change been adopted in 2001, proforma net income for the fourth quarter of that year would approximate $1.7 million or $0.06 per share.

Revenues for fourth quarter of 2002 increased 29.9% to $23.7 million, compared to $18.2 million for the same period in 2001. Premiums for the quarter increased 34.8% from $15.0 million in 2001 to $20.2 million in 2002 due to a 27.4% increase in new life insurance premiums and the acquisition of Combined and Lifeline that contributed $3.7 million to 2002 premiums. Additionally, net investment income increased 15.8% to $3.7 million from $3.2 million in 2001 due to continued expansion of the Companys asset base that was accelerated by the acquisitions. Total benefits and expenses for the quarter ended December 31, 2002, increased 32.6% to $22.0 million from $16.6 million in 2001. The acquisitions increased fourth quarter 2002 benefits and expenses by $3.2 million with the remaining increase primarily attributed to surrender activity.

Total assets at December 31, 2002, grew 15.7% to $326.3 million, compared to $282.1 million at December 31, 2001. The increase is primarily attributed to the acquisitions that added assets of $31.4 million. Stockholders equity was $101.8 million at the close of 2002, compared to $82.7 million at December 31, 2001, reflecting the issuance of approximately $12.0 of Class A common stock for the acquisition of Combined and Lifeline, 2002 earnings and a $2.8 million mark-to-market increase in the value of the Companys bond portfolio.

On February 18, 2003, the Company consummated the acquisition of First Alliance Corporation, parent of First Alliance Insurance Company, both of Lexington, Kentucky, for approximately 2.6 million shares of Citizens Class A common stock with a market value of approximately $17.2 million. On an estimated basis, the transaction boosts Citizens assets to $350 million, annual revenues to $90 million and stockholders equity to $120 million.

Additionally, on March 10, 2003, the Company announced a definitive agreement to acquire all outstanding shares of Mid-American Alliance Corporation (Mid-American) of Jefferson City, Missouri, parent of Mid-American Century Life Insurance Company, a Missouri life insurer, and Security Alliance Insurance Company, an Arkansas life insurance company, for shares of Citizens Class A common stock. Subject to approval by Mid-Americans shareholders and insurance regulatory authorities in Missouri and Arkansas, the exchange will be based upon a market value of $1.35 per share for Mid-American, while the price for Citizens shares will be determined using its average 20 day price preceding closing, which is expected in the first half of 2003. The transaction is valued at approximately $8.2 million.

About Citizens, Inc.

Citizens, Inc. is a financial services company listed on the New York Stock Exchange under the symbol CIA. Its growth strategy is to reach $1 billion in assets, $250 million in revenues, $10 billion of life insurance in force and $250 million in stockholders equity by 2010 by targeting the sale of U.S. dollar whole life insurance policies in the United States and overseas, and via the acquisition of other life insurance companies. Citizens is included in the Russell 2000® Index, which measures the performance of the largest companies in the U.S. stock market based on market capitalization. Citizens stock closed at $6.28 on March 27, 2003.

Additional information is available at the Companys web site: www.citizensinc.com.

Information herein contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as may", will", expect", anticipate" or continue" or comparable words. In addition, all statements other than statements of historical facts that address activities that the Company expects or anticipates will or may occur in the future are forward-looking statements. Readers are encouraged to read the SEC reports of the Company, particularly its Form 10-K for the fiscal year ended December 31, 2002, for the meaningful cautionary language disclosing why actual results may vary materially from those anticipated by management.

CITIZENS, INC.
COMPARATIVE CONSOLIDATED FINANCIAL HIGHLIGHTS

OPERATING STATEMENTS

   Year EndedDecember 31,   (Unaudited)Three Months EndedDecember 31,
   2002   2001   2002   2001
Premiums and Other Revenues            
Premium income   $68,210,881   $53,962,937   $20,182,739   $14,977,149
Net investment income   14,251,907   13,296,481   3,689,631   3,186,257
Other         541,110         387,406         (188,102)         65,154
Total revenues   $83,003,898   $67,646,824   $23,684,268   $18,228,560
Benefits and Expenses            
Increase in future policy   benefit reserves   6,051,671   6,483,706   1,184,496   1,781,633
Claims and surrenders   38,107,119   29,189,132   11,022,944   7,582,453
Policyholder dividends   3,477,381   3,294,899   986,578   993,577
Commissions   16,339,205   13,444,270   4,846,010   3,810,312
Underwriting and   insurance expenses   15,064,065   10,635,639   4,834,601   2,755,710
Net change in deferred policy   acquisition costs   (4,383,354)   (2,543,651)   (1,591,143)   (907,749)
Other         2,808,785         2,114,199             713,342              577,525
Total benefits and expenses   $77,464,872    $62,618,194   $21,996,828    $16,593,461
Income before federal        income tax   $5,539,026   $5,028,630   $ 1,687,440   $1,635,099
Federal income tax expense         1,284,809         1,065,517         332,859         135,517
Net income    $4,254,217       $3,963,113   $ 1,354,581   $ 1,499,582
INCOME PER SHARE            
         (Unaudited)
Net income per share   $0.14   $0.14   $0.04   $0.05
Average shares outstanding    29,860,836    28,897,382    30,120,983    28,897,382
            
BALANCE SHEETS            
   December 31,2002   (Unaudited)September 30,2002   (Unaudited)June 30, 2002   (Unaudited)March 31,2002   December 31,2001
Total assets   $326,291,001   $320,477,535   $319,382,108   $312,363,433   $282,086,263
Total invested assets   $226,008,600   $216,758,585   $220,136,311   $219,979,651   $206,695,811
Stockholders' equity   $101,792,305   $ 97,617,296   $ 97,686,024   $ 93,853,586   $ 82,721,798