Table of Contents CITIZENS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) conversion. The impact is reflected in the accompanying consolidated financial statements and summarized in the table below. (In thousands) 2019 2018 Increase (Decrease) Consolidated Balance Sheets DAC $ (1,396) (4,339) Future policy benefit reserves: Life insurance (2,299) (10,197) Consolidated Statements of Operations and Comprehensive Income (Loss) Decrease in future policy benefit reserves (2,299) (10,197) Amortization of deferred policy acquisition costs 1,396 4,339  Income before federal income tax 903 5,858  Federal income tax expense 190 1,230  Net income $ 713 4,628  Cost of insurance acquired ("COIA") is established when we purchase a block of insurance. COIA is amortized over the emerging profit of the related policies using the same assumptions as were used in computing liabilities for future policy benefits. Inherent in the amortization of COIA are certain management judgments used in the estimation of the ending asset balance and the annual amortization. The key assumptions used in management's estimates are based upon interest, mortality and lapses at the time of purchase. A recoverability test that considers, among other things, actual experience and projected future experience is performed at least annually. These annual recoverability tests are based initially on an estimate of the available premium (gross premium less the benefit and expense portion of premium) for the next 50 years. Management believes that our COIA is recoverable for the years ended December 31, 2020 and 2019. This belief is based upon the analysis performed on estimated future results of the block and our annual recoverability testing. COIA relative to purchased blocks of insurance is summarized as follows: December 31, 2020 | 10-K 86 Years ended December 31, (In thousands) 2020 2019 2018 Balance at beginning of period $ 13,455 15,225  17,499  Amortization (1,816) (1,546) (2,458) Change in effects of unrealized (gains) losses on COIA (98) (224) 184  Balance at end of period $ 11,541 13,455  15,225  COST OF INSURANCE ACQUIRED