Globe Life: Turmoil over Alleged Closures and the Power of Virtual Transformation

The shares of Globe Life experienced a decline after the short-seller Viceroy Research reported that the subsidiary American Income Life (AIL) had apparently closed several significant offices. Despite these claims, the insurance company defended its strategy and emphasized the transition to a virtual business model implemented since the pandemic. On Wednesday, Globe Life's stock price initially fell by up to 8.4% but then stabilized with a decrease of 2.4% at $106.82 in the afternoon in New York. Viceroy Research had expressed doubts about AIL's presence in a report, which Globe Life dismissed as completely inaccurate. The company stated that by transitioning to virtual work forms, it increased flexibility for its agents, allowing the number of agents to grow from over 8,000 in March 2020 to over 12,000 in November 2024. Viceroy, on the other hand, reiterated that it had confirmed some closures directly with former AIL agents and noted that offices at the addresses of several major agencies were up for rent. Nevertheless, Globe Life insists that such reports aim to unsettle the market and paint a false picture. It is not the first time Globe Life has come under Viceroy's scrutiny, which had accused the insurance company of unfair business practices earlier this year. Fuzzy Panda Research had made similar allegations in April. However, during a review by Globe Life in July, these accusations could not be confirmed, which analyst John Barnidge of Piper Sandler Cos. considered positive for the upcoming quarterly results.