The origins of SLIC date to 20 October 1927 with the chartering of its predecessor firm, Dixie Life Insurance Company, in Raleigh, North Carolina. Among the early investors in the new enterprise was attorney A. J. Fletcher (1887-1979), who continued to serve on the Board of Directors for over fifty years. In April 1931, W. L. Carter (1879-1968) was appointed President and Director of the fledgling company, and the firm's headquarters were moved to Greensboro. The following year, Dixie Life acquired the Greensboro-based Southern Life and Accident Insurance Company, and the parent firm changed its name to Southern-Dixie Life Insurance Company. The addition in 1935 of T. C. Collins (1901-1975) as Agency Manager and Secretary considerably strengthened the firm's management team. From that date, Carter, Collins, Fletcher, and their descendants would retain financial control of the company and oversee policy decisions through its Board of Directors.

Through the 1930's and 1940's Southern-Dixie Life specialized in weekly premium, or "debit," life insurance targeted to lower-middle and working class families, primarily in central and eastern North Carolina. By 1947, steady sales increases and a growing home office staff prompted the company to move its headquarters to a separate building at 330 South Greene Street in Greensboro, where it would remain for 33 years. Shortly thereafter, the firm changed its name to Southern Life Insurance Company.

The end of World War II also brought new managerial talent and increased opportunities for expansion to Southern Life. In 1946, Wilbur L. "Bo" Carter, Jr. (1922-), a recent graduate of Davidson College and veteran of combat in Europe, joined the company and assumed an active role in long-range decisions as well as day-to-day operations. By the time he succeeded his father as president in 1964, Carter had witnessed product diversification, geographic expansion, and tremendous sales growth. Beginning in 1951, SLIC launched its Ordinary (later to be known as General Agency) Division which eventually encompassed thirteen southeastern states. In 1952, SLIC purchased and reinsured the business of Southern Life Insurance Company of Florence, South Carolina and the following year bought Dixie-Security Life of Sumter, South Carolina, thus acquiring established debit business in the Palmetto State. To compare Southern Life's overall growth during the period, its total insurance in force in 1947 was $59.8 million; at the end of 1964, that figure stood at $343 million.

For the next twenty years, SLIC would maintain a pattern of increased sales and conservative investment which would earn A. M. Best's A+ (Superior) rating. The benchmark of $1 billion insurance force was attained in 1976, and the $2 billion mark was reached in 1984. The company also embarked on an ambitious building project in 1979, which would include a new headquarters building in downtown Greensboro with an adjacent hotel.

By the mid-1980's, however, a combination of factors which included increasing operating costs, diminishing or static investment yields, an outdated marketing strategy, and the approaching retirement of Wilbur Carter, induced the Board of Directors to seek a buyer for Southern Life. Consequently, the SLIC Board agreed in October 1986 to sell the firm to Liberty Life Insurance Company of Greenville, South Carolina. In noting the similarities between the two companies, The Liberty Corporation's W. Hayne Hipp commented, "It's a natural fit for our two companies to be together... It (the sale) is a classic case of two plus two adding up to five." The final agreement of sale for $80 million in cash, or the equivalent of $400 per share, was concluded on 31 December 1986.