MESSAGE FROM THE PRESIDENT The year 2012 was a remarkable  chapter in the history of Kansas  City Life Insurance Company,  as the Company generated  strong earnings and reached  new heights in terms of assets  and stockholders’ equity. The  Company recorded net income  of $39.9 million, the highest  level of earnings since 2004, and  the year ended with assets and  stockholders’ equity growing to  $4.5 billion and $750 million,  respectively. A highlight of the  year was that the Company  was able to share the favorable  financial performance through the  payment of a special dividend in  December 2012.  period could the Company have  taken the long-term view of  knowing that sound investments  would again bear rewards.  The challenges of globally  low interest rates and fragile  economic systems, along  with political uncertainties  of addressing public finance  deficits and long-term debt,  have certainly not abated.  Despite these challenges, the  Company is well positioned to  deal with these and the many  other challenges that we may  potentially face in both the near- and long-term future.  These results were perhaps  most notable because they  were generated during a period  of significant economic and  political uncertainty, and they  stand in contrast relative to the  impact of the recent recession.  However, Kansas City Life  continues to successfully weather  difficult periods of recession and  uncertainty as the Company grows  and prospers over time; and to  share these benefits is reflected in  the values upon which we operate.  The ability to maintain a long- term perspective is one of the  most important attributes in  providing Security Assured to  those we serve. Many of the seeds  for the harvest of 2012 were  planted during the great recession,  and only by having had financial  strength during this difficult  Another important step taken  by the Company in 2012 was  the promotion and expansion  of marketing responsibilities for  Kansas City Life Vice Chairman  of the Board and President of Old  American Insurance Company,  Walter E. “Web” Bixby, LLIF.  Having guided Old American to  six consecutive years of growth  in new premiums, Web was  promoted to Executive Vice  President at Kansas City Life.  Kansas City Life will continue  to maintain a diversified product  portfolio and focus on cultivating  strong relationships with its  policyholders, agents, general  agents and sales representatives,  and we plan to expand upon these  in the future. These relationships,  together with leadership trained  on long-term results and a  commitment to a value system  based on honor and integrity,  create the foundation for our  ability to meet challenges and  provide for a prosperous future to  all we serve. This strengthens the Company’s  emphasis and priority of providing  protection to policyholders  through life insurance.  During the past year, Kansas  City Life pursued opportunities  to reallocate investments, altered  product marketing programs for  certain existing products and  developed new product features  that were aimed at improving  performance in the low interest  rate environment. The Company  also took measures to reduce  exposure to potential future  market volatility. 3 President, Chief Executive Officer and Chairman of the Board — R. Philip Bixby