[W. Kenny Massey | President and CEO

Our CreedThere is a destiny that makes us brothers; None goes his way alone;All that we send into the lives of others. Comes back into our own.

Edwin Markham circa 1939

Our VisionModern Woodmen of America will grow nationwide through members helping members create a better tomorrow for themselves, their families and others.

Our MissionTo improve the quality of lifefor our members.

Board of Directors

Lori A. Newberg | Director, Lenexa, Kansas

William D. Keltner | Director, Jackson, Tennessee

David B. Emrick | Director, Davenport, Iowa

Robert C. Pollex | Director, Perrysburg, Ohio

W. Kenny Massey | President, LeClaire, Iowa

Gary L. Medd* | Director, Davenport, Iowa

Jerald J. Lyphout | National Secretary, East Moline, Illinois

Albert T. Hurst Jr.* | Director, Little Rock, Arkansas

Darcy G. Callas | Director, Moline, Illinois

From left to right

Maybe it’s because I have young grandsons, but lately

I’ve thought a lot about the story of The Three Little Pigs.

(No, the boys are not especially messy!)

In the story, the first little pig built a house of straw, and the

second built a house of sticks. Both met their demise when

the wolf came to the door and easily blew their houses

down. The third used bricks and built a stable foundation

for his future. He outsmarted the wolf and lived happily

ever after.

That fable shares a lot of truths. A stable foundation can

withstand tumultuous times. And a steady, guiding hand

keeps the focus on the long term. I’m happy to share

Modern Woodmen of America’s 2016 annual report and

showcase the work done to build on Modern Woodmen’s

strong foundation for long-term success.

Joseph P. Sztapka Sioux Falls, South Dakota

Appointed 2017

James E. Temperley Bonita Springs, Florida

Appointed 2017

2016

Stability – the foundation of tomorrow

Annual Report*Concluded term Dec. 31, 2016

Kenny and Tammy Massey and their grandsons, Will, Michael, J.J. and C.K.

24 25

Social, educational and volunteer events in 2016

Matching Fund Program

From Memorial Day to Sept. 11, 2016, Modern Woodmen

members across the country held events to thank the first

responders, military members, veterans and other heroes

who serve and protect our towns.

Through Modern Woodmen’s Be an Everyday Hero project,

89 chapters, Summit chapters and youth service clubs

held 273 service projects and Matching Fund events to

honor these heroes and all they do for their communities.

More than 2,000 firefighters, police officers, medical

personnel, military members, veterans and others were

recognized throughout the year.

Created to observe the 15th anniversary of 9/11, the

project also made an impact in Modern Woodmen’s home

office community, the Quad Cities. Modern Woodmen’s

home office hosted a 9/11 memorial exhibit, and

employees planned a patriotic march of heroes on Sept.

11, funded the purchase of a local K-9 officer and raised

more than

$7,000 to support future heroes through a career

exploration program.

Make an ImpactFun and fulfillment through member chapters

Volunteer, socialize and learn with Modern

Woodmen! Through our Make An Impact

initiative, chapters, Summit chapters and

youth service clubs are offering a wider variety

of meaningful (and fun!) experiences for

members of all ages. Join us for one activity, or

all of them! And ask your local chapter leader

or financial representative how you can get

involved with a chapter or its chapter board

– great, easy ways to give back to local causes

and volunteer projects in your community.

Let’s make an impact!

Matching Fund ProgramEvents supporting members’ communities top $32* million

Modern Woodmen members donate more

than just dollars through our Matching

Fund Program. With their chapters,

Summit chapters and youth service clubs,

members help identify local organizations

and individuals in need – and they’re active

in raising money to meet those needs.

Members volunteer to plan, run or support

fundraisers such as bake sales, barbeques, silent

auctions or spaghetti dinners. To make an even

Member activities

Local heroes honored with Be an Everyday Hero project

26 2016 Annual Report

Chapters

at social, educational and volunteer events for member families.

2,466 active

chapters age 55+ participated.

Summit Chapters

283 active chapters

Project recognized the 15th anniversary of 9/11

54,216 members

273 service projects and fundraisers

2,000 heroes recognized

More than

$357,000raised nationally

Service Projects/Volunteer Activities

{ }

9,094 hands-on events

Youth Service Clubs782 active clubs nationwide

87,419 participants

562,388 volunteer hours

members’ communities$1.98 MILLION

805,575 attendees

Youth Educational ProgramsCourses on financial literacy, exercise and nutrition, and more reached

1.3 million children.

$32.2* million contributed

to community projects and individuals

in need.

3,441 fundraising events

Modern Woodmen’s Matching Fund Program

matches money raised through qualifying events,

up to $2,500 annually for each chapter and $500

for each youth service club.

* Includes total dollars raised by member chapters and youth clubs partnering with community groups.

BIGGER IMPACT, Nearly

27

Final Wishes benefitFree tool to help you share your wishes with loved ones

It can be hard to know where to start when it comes to end-of-life

planning. Now, you can start at modernwoodmen.org.

The Final Wishes benefit is available to members as an online

tool, giving you free access to a wealth of information. The website

also helps you complete several personal planning documents.

Save them to your computer for future reference and share them

with your loved ones to communicate your end-of-life wishes.

Final Wishes contains helpful resources, such as:

Relevant to today’s members of all life stages

Member benefits

100 Percent Modern Woodmen Family Benefit

12,829 children

received books for birthdays.

Children and adolescents

Single adults

Families

50 and older

Kobi Finley, Ormond Beach, Fla., likes the fraternal “giving back” side of Modern Woodmen. Each year, her daughters receive birthday books through the 100 Percent Modern Woodmen Family Benefit. “It’s a nice gesture,” Kobi says. “You just don’t expect financial companies to care that much.”

Accelerated Benefits

in premiums and interest paid for terminally ill members.

$62,897

College Scholarship Program

$448,625 awarded to 258 member students.

Final Wishes(see sidebar)

1,593 members planned their final wishes.

Fraternal Aid Fund

$137,904 in premiums paid for members who were victims of medical, fire or natural disasters.

Documents for end-of-life financial and funeral planning.

Information on choosing an executor and the executor’s role.

Advice on talking about final wishes and sharing plans with others.

Tools to help loved ones make notifications and financial decisions after your death.

Make An Impact ScholarshipsNew college scholarship program promotes community impact

Modern Woodmen introduced a brand-new college scholarship program

in fall 2016. With more emphasis on community involvement, the new

program supports our Make An Impact fraternal initiative and rewards

member students for their volunteer activities.

Two types of scholarships allow members to choose the path

that’s right for them. The new program also features an increased number

of scholarships and higher yearly scholarship amounts.

28 2016 Annual Report Modern Woodmen of America | Stability – the foundation of tomorrow 29

Member benefits for all life stages — learn more at modernwoodmen.org.

Member Discounts

Special savings on gym memberships, park passes, health screenings and more.

Orphan Benefit

$75,900in financial support for 26 orphans.

Newborn Benefit

$35,000 of life insurance issued

for infants in poor health.

Promises are important to you, our members, and to Modern Woodmen. Since 1883, we’ve been committed to serving members like you, your families and your communities. Here’s a recap of what we accomplished together in 2016.

OperationsLife insurance in force: $38.9 billionThe total amount of life insurance owned by members to protect their families.

Assets: $15.4 billion 4.4 percent increase from 2015 (See a breakdown of our investments on Page 35.)

Life insurance, annuity and other certificate reserves: $12 billionFunds held to guarantee future benefits to members.

Payments and benefits to members: $871 millionIncludes death benefits, annuity payments and surrender benefits.

Dividend payments: $7.2 millionRefunded to life insurance and annuity certificates.

Surplus and special reserves: $1.6 billionTo provide additional safety for members – and funds for future growth.

Solvency ratio: 111.86 percentFor every $100 of liabilities (promises made to members), Modern Woodmen has $111.86 of assets. The industry average solvency ratio is 105.95.*

Brian Boozer’s parents bought life insurance for their son when he was just 1 day old. “I always thought it was wise of them,” Brian says. Now grown with a child of his own, the member from Gadsden, Alabama, turned to Modern Woodmen to protect his young family for the future.

MEMBER STORY

Members nationwide: Nearly 764,000

2,466 adult chapters 283 Summit chapters (for members age 55+)

782 youth service clubs

Part of:

Total fraternal expenditures: $21.7 millionFor family-oriented member activities, benefits and programs, such as disaster relief assistance, college scholarships, social, educational and volunteer service programs, and educational programs for schools and youth groups.

{

Walt Willet makes an impact with his Modern Woodmen youth service club. Members of the club like to have fun while helping others in their Indianapolis community. The kids have participated in food drives, helped clean up the neighborhood and shown support for the local fire department.

Fraternalism

MEMBER STORY

Angel Ford’s Cheraw, South Carolina, community was shocked by the sudden death of her husband, Terrance. I was like, ‘Oh my God. How am I going to take care of three kids by myself?’” remembers Angel. Then she discovered the protection Terrance left in the form of Modern Woodmen life insurance. The death benefit helped her family stay in their home and go on with life.

MEMBER STORY

Life insurance products • Whole life insurance• Universal life insurance• Term life insurance

Annuity products • Fixed annuities• Immediate annuities• Variable annuities1

Investment products1

• Mutual funds• Retirement plans – Traditional IRA, Roth IRA,

SEP-IRA, SIMPLE IRA, 401(k), 403(b) TSA• College savings plans – 529 college savings plans,

Coverdell education savings accounts, UGMA/UTMA accounts

• Brokerage services

Insurance products2

• Dental and vision insurance• Disability income insurance• Group employee benefits• Group voluntary benefits• Impaired risk life insurance• International life and health insurance• Long-term care insurance• Health insurance• Medicare supplement insurance• Medicare Advantage and prescription drug plans

Banking products3

• Checking accounts• Savings accounts• Certificates of deposit• First mortgage home loans (new purchases

and refinancing included)• Home equity loans• Visa® credit cards and gift cards• Health savings accounts

1 Securities offered through MWA Financial Services Inc., a wholly owned subsidiary of Modern Woodmen of America. Member: FINRA, SIPC.

Individual agents may not be licensed to sell all products. 2 Not issued by Modern Woodmen of America. Brokered insurance products available through MWAGIA Inc., a Modern Woodmen subsidiary. Product availability varies by state.3 Modern Woodmen Bank is a marketing name for MWABank, a wholly owned subsidiary of Modern Woodmen of America. Annuities, insurance, retirement plans, mutual funds and other securities are not insured by the FDIC or any other federal government agency, are not obligations or deposits for MWABank, and are not guaranteed by MWABank. These products involve risk, including the possible loss of principal invested. MWABank is an Equal Housing Lender.

ProductsModern Woodmen can help you meet a wide range of needs through a wide range of financial products.

our mission is to improve quality of life

for our members.

Building on a strong foundation

financially and fraternallyProtecting members

- W. Kenny Massey, Modern Woodmen of America president and CEO

[*Source: Standard Analytical Service, Inc., 2016

We do everything with them in mind.”

“Financially and fraternally, [

30 2016 Annual Report Modern Woodmen of America | Stability – the foundation of tomorrow 31

STATEMENT OF OPERATIONS

Income:

Premiums and other considerations:

Life and annuities

Other

Investment income, net of expenses

Amortization of interest maintenance reserve

Other income

Total income

Benefits and expenses:

Benefits:

Life and annuities

Other

Increase in certificate reserves

Employees’ and fieldworkers’ benefit plans

Commissions

General insurance expenses

Insurance, taxes, licenses and fees

Fraternal expenses

Net transfers to or (from) Separate Accounts

Total benefits and expenses

Net gain from operations before dividends to

certificateholders and net realized capital gains

Dividends to certificateholders

Net gain from operations before net

realized capital gains

Net realized capital gains

Net income

2016

$1,041,105

1,965

570,158

12,566

7,901

1,633,695

860,789

10,327

473,037

5,572

62,979

134,216

7,013

21,673

45,585

1,621,191

12,504

7,228

5,276

22,969

$28,245

STATEMENT OF CASH FLOWS

Cash from operations:

Premium and annuity considerations

Investment income, net

Other income

Total cash received from operations

Benefit and loss related payments

Commissions and other expenses paid

Net transfers to or (from) Separate Accounts

Dividends paid to certificateholders

Total cash paid from operations

Net cash from operations

Cash used in investments:

Proceeds from investments sold or matured:

Bonds

Stocks

Mortgage loans

Real estate

Other invested assets

Miscellaneous proceeds

Total investment proceeds

Cash applied, cost of investments acquired:

Bonds

Stocks

Mortgage loans

Real estate

Other invested assets

Miscellaneous applications

Total investment applications

Net increase in certificate loans and liens

Net cash used in investments

Other cash provided by (used in) financingactivities and other miscellaneous sources

Increase (decrease) in cash and short-term investments

Cash and short-term investments,beginning of year

Cash and short-term investments, end of year

2016

$1,042,874

566,911

7,901

1,617,686

865,939

223,095

48,524

9,028

1,146,586

471,100

1,213,997

102,667

61,950

50

47,440

71,145

1,497,249

1,682,510

91,183

95,758

403

66,647

0

1,936,501

(7,084)

(432,168)

16,263

55,195

126,386

$181,581

Modern Woodmen of America – Year ended Dec. 31, 2016 (dollars in thousands) unaudited

STATEMENT OF SURPLUS

Appropriated:

Balance at beginning of year

Transfer (to) from unassigned surplus

Balance at end of year

Unassigned:

Balance at beginning of year

Net income from operations

Net unrealized capital gains

Change in asset valuation reserve

Change in nonadmitted assets

Transfer (to) from appropriated surplus

Other changes, net

Balance at end of year

Total surplus

2016

$278,776

(543)

278,233

1,312,475

28,245

33,263

(10,408)

4,412

543

(13,981)

1,354,549

$1,632,782

2015

$277,015

1,761

278,776

1,202,031

50,291

(28,580)

55,900

(9,526)

(1,761)

44,120

1,312,475

$1,591,251

2015

$1,056,454

559,090

9,993

1,625,537

810,947

204,078

60,769

14,794

1,090,588

534,949

1,140,996

147,080

44,823

0

59,899

6,045

1,398,843

1,763,765

89,502

39,967

28

51,955

0

1,945,217

(5,095)

(541,279)

32,698

26,368

100,018

$126,386

2015

$1,054,369

4,068

565,383

11,287

9,994

1,645,101

824,622

12,105

489,947

5,524

63,428

117,560

7,380

19,200

58,125

1,597,891

47,210

9,294

37,916

12,375

$50,291

2016

$12,297,018

2,275

32,952

3,373

7,300

121

394,530

240,029

56,066

48,593

249,994

436,268

13,768,519

278,233

1,354,549

1,632,782

15,401,301

BALANCE SHEETS

Assets

Investments:

Bonds

Common stocks

Mortgage loans

Real estate and home office property

Cash and short-term investments

Certificateholders’ loans

Securities lending reinvested collateral

Other invested assets

Total investments

Investment income due and accrued

Electronic data processing equipment

Other assets

Separate account assets

Total assets

Financial statements

2016

$12,422,902

788,086

523,244

24,407

181,581

164,478

394,530

332,218

14,831,446

128,614

2,178

2,795

436,268

15,401,301

Liabilities and Surplus

Liabilities:

Aggregate reserves for certificates and contracts:

Life and annuity

Accident and health

Certificate and contract claims

Other certificateholders’ funds

Dividends payable to certificateholders

Accrued commissions, general expenses and taxes

Payable for securities lending collateral

Other liabilities

Liability for employees’ and fieldworkers’ benefits

Interest maintenance reserve

Asset valuation reserve

Separate account liabilities

Total liabilities

Surplus:

Appropriated

Unassigned

Total surplus

Total liabilities and surplus

2015

$11,941,085

745,126

489,386

26,014

126,386

171,210

465,676

295,220

14,260,103

128,731

2,992

2,720

359,968

$14,754,514

2015

$11,787,522

2,536

36,885

3,540

9,100

3,671

465,676

165,789

53,032

35,958

239,586

359,968

13,163,263

278,776

1,312,475

1,591,251

$14,754,514

32 2016 Annual Report Modern Woodmen of America | Stability – the foundation of tomorrow 33

2016 Financial Highlights

Modern Woodmen’s increasing asset base is a strength.

2012 2013 2014 2015 2016

$15.5

$15.0

$14.5

$14.0

$13.5

$13.0

$12.5

$12.0

$11.5

$11.0

$10.5

$10.0

$9.5

$9.0

$12.39

$14.75

$15.40

$13.40

$14.13

Growth in AssetsDollars in billions

Fraternal expenditures for the year reflect strong usage of benefits and programs by members.

2012 2013 2014 2015 2016

$19.20

$21.67

$19.83$20.04

$19.03

$21.5

$21.0

$20.5

$20.0

$19.5

$19.0

$18.5

$18.0

$17.5

$17.0

$16.5

$16.0

$15.5

$15.0

$14.5

$14.0

$13.5

Fraternal ExpendituresDollars in millions

$39

$38

$37

$36

$35

$34

$33

$32

$31

2012 2013 2014 2015 2016

$37.27

$38.92

$38.07

$36.32

$35.53

Life insurance in force shows consistent growth and increased protection for members.

Life Insurance in ForceDollars in billions

Quality Investments Assets are invested primarily in high-quality, low-risk investments. As of Dec. 31, 2016,

approximately 99.3 percent of bonds were of high or medium quality.

Bonds

Certificate Loans, Cash and Other Assets

Mortgage Loans and Real Estate

Common Stocks

84%

7%5%

4%

34 2016 Annual Report Modern Woodmen of America | Stability – the foundation of tomorrow 35