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Future Policy Benefits and Claims

12 Months Ended

Dec. 31, 2024

10. Future Policy Benefits and Claims

Future policy benefits and claims include reserves for short-duration contracts and long-duration contracts as well as certain reinsurance balances, when in a liability position.

The following tables summarize disaggregated amounts included in future policy benefit and claims and reconcile the totals to those reported in the consolidated statements of financial position.


	December 31, 2024		December 31, 2023

	(in millions)
Liability for future policy benefits by segment (1):
Retirement and Income Solutions:
Pension risk transfer	$	24,958.1	$	23,855.8
Individual fixed income annuities		4,504.6		4,914.1
Total Retirement and Income Solutions		29,462.7		28,769.9
Principal Asset Management – International Pension:
Latin America:
Individual fixed income annuities		4,126.9		4,593.7
Benefits and Protection:
Specialty Benefits:
Individual disability		1,829.0		1,898.4
Life Insurance:
Term life		1,248.0		1,085.9
Total Benefits and Protection		3,077.0		2,984.3
Corporate:
Long-term care insurance		164.8		166.7
Total liability for future policy benefits		36,831.4		36,514.6

Additional liability for certain benefit features by segment (2):
Benefits and Protection – Life Insurance:
Universal life		6,037.2		5,326.5
Total additional liability for certain benefit features		6,037.2		5,326.5

Reconciling items:
Participating contracts		2,924.2		3,060.5
Short-duration contracts		1,267.4		1,283.4
Cost of reinsurance liability		958.1		424.6
Reinsurance recoverable liability		60.3		45.2
Other (3)		100.8		171.7
Future policy benefits and claims per consolidated statements of financial position	$	48,179.4	$	46,826.5

(1)	Amounts include the deferred profit liability.

(2)	Includes reserves on certain long-duration contracts where benefit features result in gains in early years followed by losses in later years.

(3)	Includes other miscellaneous reserves and the impact of unrealized gains (losses) on the additional liability for certain benefit features.

Liability for Unpaid Claims

The liability for unpaid claims is reported in future policy benefits and claims within our consolidated statements of financial position. Activity associated with unpaid claims was as follows:


	For the year ended December 31,
	2024		2023		2022

	(in millions)
Balance at beginning of period	$	1,405.9	$	1,395.0	$	1,370.9
Less: reinsurance recoverable		67.8		68.6		68.7
Net balance at beginning of period		1,338.1		1,326.4		1,302.2
Incurred:
Current year		1,749.4		1,650.4		1,581.8
Prior years		(111.2)		(95.4)		(44.4)
Total incurred		1,638.2		1,555.0		1,537.4
Payments:
Current year		1,288.0		1,189.2		1,138.0
Prior years		369.6		354.1		375.2
Total payments		1,657.6		1,543.3		1,513.2
Net balance at end of period		1,318.7		1,338.1		1,326.4
Plus: reinsurance recoverable		61.2		67.8		68.6
Balance at end of period	$	1,379.9	$	1,405.9	$	1,395.0

Incurred liability adjustments relating to prior years, which affected current operations during 2024, 2023 and 2022, resulted in part from developed claims for prior years being different than were anticipated when the liabilities for unpaid claims were originally estimated. These trends have been considered in establishing the current year liability for unpaid claims.

Short-Duration Contracts

Future policy benefits and claims include reserves for group life and disability insurance that provide periodic income payments. These reserves are computed using assumptions of mortality, morbidity and investment performance. These assumptions are based on our experience, industry results, emerging trends and future expectations. Future policy benefits and claims also include reserves for incurred but unreported group disability, dental, vision, critical illness, accident, PFML, hospital indemnity and life insurance claims. We recognize claims costs in the period the service was provided to our policyholders. However, claims costs incurred in a particular period are not known with certainty until after we receive, process and pay the claims. We determine the amount of this liability using actuarial methods based on historical claim payment patterns as well as emerging cost trends, where applicable, to determine our estimate of claim liabilities. Premium deficiency reserves may be established for short-duration contracts to provide for expected future losses. The premium deficiency reserve calculation considers, among other factors, anticipated investment income.

We have defined claim frequency as follows for each short-duration product:

●

LTD: Claim frequency is based on submitted reserve claim counts.

●

Group Life Waiver: Claim frequency is based on submitted reserve claim counts, consistent with LTD.

●

Dental and Vision: Claim frequency is based on the claim form, which may include one or more procedures.

●

STD, Critical Illness, Accident, Hospital Indemnity and PFML: Claim frequency is based on submitted claims.

●

Group Life: Claim frequency is based on submitted life claims (lives, not coverages).

We did not make any significant changes to our methodologies or assumptions used to calculate the liability for unpaid claims for short-duration contracts during 2024.

Claims Development

The following tables present undiscounted information about claims development by incurral year, including separate information about incurred claims and paid claims net of reinsurance for the periods indicated. The tables also include information on incurred but not reported claims and the cumulative number of reported claims.

The tables present information for the number of years for which claims incurred typically remain outstanding, but do not exceed ten years. The data is disaggregated into groupings of claims with similar characteristics, such as duration of the claim payment period and average claim amount, and with consideration to the overall size of the groupings. Outstanding liabilities equal total net incurred claims less total net paid claims plus outstanding liabilities for net unpaid claims of prior years.

LTD and Group Life Waiver Claims


																					Incurred		Cumulative
																					but not		number of
																					reported		reported
	Net incurred claims (1)																				claims		claims

	December 31,
	2015		2016		2017		2018		2019		2020		2021		2022		2023		2024		2024		2024

	($ in millions)
Incurral
year
2015	$	231.0	$	227.2	$	217.2	$	215.3	$	208.2	$	210.0	$	211.8	$	210.5	$	208.3	$	208.5	$	0.1		7,184
2016				229.8		228.4		219.4		219.5		214.4		218.7		221.9		219.0		218.0		0.1		6,172
2017						238.4		239.7		243.1		245.8		245.2		246.5		248.9		248.7		0.1		6,092
2018								239.4		245.1		239.2		239.8		235.3		238.0		241.9		0.1		5,784
2019										255.2		248.4		240.4		240.2		238.6		243.4		0.1		5,962
2020												252.1		231.0		221.1		217.7		211.3		0.1		5,942
2021														259.7		244.5		221.6		221.2		6.2		5,586
2022																274.3		240.5		227.6		8.5		5,646
2023																		267.4		245.2		15.2		5,354
2024																				263.9		96.7		2,953
Total net incurred claims																			$	2,329.7


	Net cumulative paid claims (1)
	December 31,
	2015		2016		2017		2018		2019		2020		2021		2022		2023		2024

	(in millions)
Incurral
year
2015	$	16.9	$	67.0	$	98.0	$	114.6	$	126.8	$	137.1	$	146.5	$	154.0	$	160.3	$	166.5
2016				16.2		70.6		105.6		124.9		136.8		147.2		157.1		165.3		171.5
2017						17.8		76.5		115.0		135.9		151.7		165.4		176.8		185.6
2018								20.1		79.9		115.7		135.7		150.3		163.3		173.3
2019										19.2		79.7		117.5		136.4		150.6		163.6
2020												20.6		78.8		113.1		130.0		140.8
2021														19.8		79.0		113.2		128.6
2022																19.6		76.6		111.4
2023																		20.0		77.3
2024																				24.5
Total net paid claims																				1,343.1
All outstanding liabilities for unpaid claims prior to 2015 net of reinsurance																				249.3
Total outstanding liabilities for unpaid claims net of reinsurance																			$	1,235.9

(1)	2015-2023 unaudited.

Dental, Vision, STD, Critical Illness, Accident, Hospital Indemnity and PFML Claims

Incurred

Cumulative

but not

number of

reported

Net incurred claims (1)

claims

December 31,

2023

2024

($ in millions)

Incurral year

2023

1,032.3

1,022.1

—

4,774,225

2024

1,129.3

66.9

4,787,967

Total net incurred claims

2,151.4

Net cumulative

paid claims (1)

December 31,

2023

2024

(in millions)

Incurral year

2023

954.0

1,021.3

2024

1,039.9

Total net paid claims

2,061.2

All outstanding liabilities for unpaid claims prior to 2023 net of reinsurance

—

Total outstanding liabilities for unpaid claims net of reinsurance

90.2

(1)	2023 unaudited.

Group Life Claims

Incurred

Cumulative

but not

number of

reported

Net incurred claims (1)

claims

December 31,

2023

2024

($ in millions)

Incurral year

2023

284.8

283.1

0.9

5,814

2024

285.1

29.6

5,265

Total net incurred claims

568.2

Net cumulative

paid claims (1)

December 31,

2023

2024

(in millions)

Incurral year

2023

215.1

277.2

2024

223.7

Total net paid claims

500.9

All outstanding liabilities for unpaid claims prior to 2023 net of reinsurance

6.1

Total outstanding liabilities for unpaid claims net of reinsurance

73.4

(1)	2023 unaudited.

Reconciliation of Unpaid Claims to Liability for Unpaid Claims

Our reconciliation of net outstanding liabilities for unpaid claims of short-duration contracts to the liability for unpaid claims follows:

December 31, 2024

Dental, Vision, STD,

Critical Illness,

LTD and Group Life

Accident, Hospital

Waiver

Indemnity and PFML

Group Life

Consolidated

(in millions)

Net outstanding liabilities for unpaid claims

1,235.9

90.2

73.4

1,399.5

Reconciling items:

Reinsurance recoverable on unpaid claims

35.1

—

0.2

35.3

Impact of discounting

(226.6)

—

(226.6)

Loss adjustment expense liability

17.7

4.1

10.3

32.1

Liability for unpaid claims - short-duration contracts

1,062.1

94.3

83.9

1,240.3

Insurance contracts other than short-duration

139.6

Liability for unpaid claims

1,379.9

Claim Duration and Payout

Our historical average percentage of claims paid in each year from incurral was as follows:


	December 31, 2024 (1)
			Dental, Vision, STD,
			Critical Illness,
	LTD and Group Life		Accident, Hospital
Year	Waiver		Indemnity and PFML		Group Life
1	8.4	%	92.2	%	78.4	%
2	24.9		7.6		19.5
3	15.5
4	8.0
5	5.8
6	5.2
7	4.4
8	3.6
9	2.9
10	2.9

(1)	Unaudited.

Discounting

The following table provides the carrying amount of liabilities reported at present value for short-duration contract unpaid claims. We use a range of discount rates to derive the present value of the unpaid claims. The ranges of discount rates as well as the aggregate amount of discount deducted to derive the liabilities for unpaid claims and interest accretion recognized are also disclosed. Interest accretion is included in benefits, claims and settlement expenses within our consolidated statements of operations.


						Dental, Vision, STD,
						Critical Illness,
	LTD and Group Life					Accident, Hospital
	Waiver					Indemnity and PFML					Group Life

	($ in millions)
Carrying amount of liabilities for unpaid claims
December 31, 2024	$			1,062.1		$			94.3		$			83.9
December 31, 2023				1,082.6					83.7					97.1
Range of discount rates
December 31, 2024		2.8	-	7.0	%		—	-	—	%		—	-	—	%
December 31, 2023		2.8	-	7.0			—	-	—			—	-	—
Aggregate amount of discount
December 31, 2024	$			226.6		$			—		$			—
December 31, 2023				215.0					—					—
Interest accretion
For the year ended:
December 31, 2024	$			34.7		$			—		$			—
December 31, 2023				34.7					—					—
December 31, 2022				33.0					—					—

Long-Duration Contracts

Gross Premiums or Assessments and Interest Accretion

The amount of gross premiums or assessments and interest accretion recognized by segment in the consolidated statements of operations was as follows:


	Gross premiums or assessments (1)						Interest accretion (2)
	For the year ended						For the year ended
	December 31,						December 31,
	2024		2023		2022		2024		2023		2022

	(in millions)
Retirement and Income Solutions:
Pension risk transfer	$	3,103.1	$	2,905.9	$	1,941.0	$	1,135.1	$	1,008.6	$	935.7
Individual fixed income annuities		46.6		42.5		30.1		208.4		219.1		229.7
Total Retirement and Income Solutions		3,149.7		2,948.4		1,971.1		1,343.5		1,227.7		1,165.4
Principal Asset Management – International Pension:
Latin America:
Individual fixed income annuities (3)		29.0		29.7		78.8		330.2		385.8		662.0
Benefits and Protection:
Specialty Benefits:
Individual disability		640.0		624.6		601.0		99.8		94.5		90.2
Life Insurance:
Universal life		715.3		681.8		577.7		253.3		209.2		171.2
Term life		673.3		649.1		630.5		57.0		48.2		43.9
Total Benefits and Protection		2,028.6		1,955.5		1,809.2		410.1		351.9		305.3
Corporate:
Long-term care insurance		4.9		5.1		5.2		9.3		9.6		9.8
Total per consolidated statements of operations	$	5,212.2	$	4,938.7	$	3,864.3	$	2,093.1	$	1,975.0	$	2,142.5

(1)

Gross premiums are included within premiums and other considerations on the consolidated statements of operations. Assessments, which are only applicable to the Life Insurance – Universal life level of aggregation, are included within fees and other revenues on the consolidated statements of operations.

(2)	Interest accretion is included within benefits, claims and settlement expenses on the consolidated statements of operations.

(3)	Includes inflation adjustments included within the liability for future policy benefits rollforward for interest accretion.

Liability for Future Policy Benefits

The liability for future policy benefits (“LFPB”) for individual and group annuities is generally equal to the present value of expected future policy benefit payments. The reserves are computed using assumptions for mortality and interest. The LFPB for non-participating term life insurance, individual disability income contracts and individual and group long-term care contracts is generally equal to the present value of expected future policy benefit payments less the present value of expected net premiums. The reserves are computed using assumptions for mortality, interest, morbidity and lapse. Cohorts are used as the unit of account for liability measurement. Actual cash flows are grouped into issue-year cohorts for the liability calculation and updated quarterly. We review and update, if necessary, assumptions used to measure cash flows for the LFPB during the third quarter of each year, or more frequently if evidence suggests assumptions should be revised. The change in our liability estimate as a result of updating cash flow assumptions is recognized in net income.

An interest accretion rate is determined for an identified cohort and remains unchanged after the issue year. For policies issued on or prior to December 31, 2020, the interest accretion rate is based on the assumed investment yield when the business was issued. For policies issued after December 31, 2020, the interest accretion rate is based on the upper-medium grade fixed-income instrument yields, which is generally equivalent to a single-A rated bond yield matched to the duration of our insurance liabilities, when the business was issued.

The LFPB is remeasured to reflect current upper-medium grade fixed-income instrument yields as of each reporting date. The liability is calculated by discounting cash flows using rate curves reflecting the currency and duration of the insurance liabilities. For discount rate tenors, or points on the curves, where the upper-medium grade fixed-income instrument yields are not liquid or limited observable market data is available, we use various estimation techniques consistent with fair value measurement guidance.

For our individual fixed income annuities in Latin America, the discount rate methodology is designed to prioritize observable inputs based on market data available in the local debt markets where the respective policies are issued in the currency in which the policies are denominated. For discount rate tenors where upper-medium grade fixed-income instrument yields based on international rating standards are not liquid or limited observable market data is available, estimation techniques are used to determine a curve in the appropriate currency.

Further details regarding reference rates used are included under “Interest Accretion and Current Discount Rates.”

Retirement and Income Solutions

The balances and the changes in the present value for expected future policy benefits were as follows:

For the year ended

December 31, 2024

December 31, 2023

Pension

Individual

Pension

Individual

risk

fixed income

risk

fixed income

transfer

annuities

transfer

annuities

($ in millions)

Present value of expected future policy benefit payments

Balance at beginning of period

23,855.8

4,914.1

21,211.4

5,019.4

Effect of changes in discount rate assumptions at beginning of period

1,036.1

296.7

1,799.6

439.0

Balance at beginning of period at original discount rate

24,891.9

5,210.8

23,011.0

5,458.4

Effect of changes in cash flow assumptions

(3.4)

(38.4)

(53.4)

(1.3)

Effect of actual variances from expected experience

(1.5)

(1.7)

(14.6)

(0.1)

Adjusted beginning of period balance at original discount rate

24,887.0

5,170.7

22,943.0

5,457.0

Interest accrual

1,135.1

208.4

1,008.6

219.1

Benefit payments

(2,238.1)

(500.2)

(1,981.4)

(507.3)

Issuances

3,112.9

46.1

2,921.7

42.0

Balance at end of period at original discount rate

26,896.9

4,925.0

24,891.9

5,210.8

Effect of changes in discount rate assumptions at end of period

(1,938.8)

(420.4)

(1,036.1)

(296.7)

Future policy benefits

24,958.1

4,504.6

23,855.8

4,914.1

Reinsurance impact

—

(4,469.4)

—

(4,869.1)

Future policy benefits after reinsurance

24,958.1

35.2

23,855.8

45.0

Weighted-average duration for future policy benefits (years) (1)

8.0

7.2

8.5

7.9

(1)	Represents the average of the cohort-level duration of the benefit cash flows weighted by the reserve balance for each cohort.

Principal Asset Management – International Pension

The balances and the changes in the present value for expected future policy benefits for Latin America – Individual fixed income annuities were as follows:


	For the year ended		For the year ended
	December 31, 2024		December 31, 2023

	($ in millions)
Present value of expected future policy benefit payments
Balance at beginning of period	$	4,593.7	$	5,042.3
Effect of changes in discount rate assumptions at beginning of period		(351.8)		(754.6)
Balance at beginning of period at original discount rate		4,241.9		4,287.7
Effect of actual variances from expected experience		1.1		0.9
Adjusted beginning of period balance at original discount rate		4,243.0		4,288.6
Interest accrual (1)		330.2		385.8
Benefit payments		(326.7)		(355.9)
Issuances		29.4		30.0
Foreign currency translation adjustment		(517.4)		(106.6)
Balance at end of period at original discount rate		3,758.5		4,241.9
Effect of changes in discount rate assumptions at end of period		368.4		351.8
Future policy benefits	$	4,126.9	$	4,593.7

Weighted-average duration for future policy benefits (years) (2)		9.8		9.9

(1)	Includes inflation adjustments.

(2)	Represents the average of the cohort-level duration of the benefit cash flows weighted by the reserve balance for each cohort.

Benefits and Protection

The balances and the changes in the present value for expected net premiums and expected future policy benefits were as follows:


	For the year ended				For the year ended
	December 31, 2024				December 31, 2023
	Specialty		Life		Specialty		Life
	Benefits		Insurance		Benefits		Insurance
	Individual				Individual
	disability		Term life		disability		Term life

	($ in millions)
Present value of expected net premiums
Balance at beginning of period	$	2,552.3	$	3,793.7	$	2,341.8	$	3,423.2
Effect of changes in discount rate assumptions at beginning of period		313.7		100.1		395.2		196.0
Balance at beginning of period at original discount rate		2,866.0		3,893.8		2,737.0		3,619.2
Effect of changes in cash flow assumptions		183.9		419.9		(37.6)		143.5
Effect of actual variances from expected experience		168.3		42.5		244.3		103.3
Adjusted beginning of period balance at original discount rate		3,218.2		4,356.2		2,943.7		3,866.0
Interest accrual		103.5		190.9		95.6		171.9
Net premiums collected		(289.1)		(390.8)		(273.4)		(359.8)
Issuances		84.4		241.0		100.1		215.7
Balance at end of period at original discount rate		3,117.0		4,397.3		2,866.0		3,893.8
Effect of changes in discount rate assumptions at end of period		(436.4)		(290.1)		(313.7)		(100.1)
Balance at end of period	$	2,680.6	$	4,107.2	$	2,552.3	$	3,793.7

Present value of expected future policy benefit payments
Balance at beginning of period	$	4,450.7	$	4,879.6	$	4,040.6	$	4,332.2
Effect of changes in discount rate assumptions at beginning of period		903.5		124.5		1,021.4		251.6
Balance at beginning of period at original discount rate		5,354.2		5,004.1		5,062.0		4,583.8
Effect of changes in cash flow assumptions		216.2		488.1		(51.5)		181.8
Effect of actual variances from expected experience		173.2		45.1		260.8		116.8
Adjusted beginning of period balance at original discount rate		5,743.6		5,537.3		5,271.3		4,882.4
Interest accrual		203.3		247.9		190.1		220.1
Benefit payments		(219.0)		(321.6)		(210.0)		(330.4)
Issuances		84.5		257.6		102.8		232.0
Balance at end of period at original discount rate		5,812.4		5,721.2		5,354.2		5,004.1
Effect of changes in discount rate assumptions at end of period		(1,302.8)		(366.0)		(903.5)		(124.5)
Balance at end of period	$	4,509.6	$	5,355.2	$	4,450.7	$	4,879.6

Future policy benefits (1)	$	1,829.0	$	1,248.0	$	1,898.4	$	1,085.9
Reinsurance impact		(412.1)		19.5		(421.6)		45.2
Future policy benefits after reinsurance	$	1,416.9	$	1,267.5	$	1,476.8	$	1,131.1

Weighted-average duration for future policy benefits (years) (2)		18.3		8.4		18.4		9.4

(1)	Represents the present value of expected future policy benefit payments less the present value of expected net premiums.

(2)	Represents the average of the cohort-level duration of the benefits less the net premium cash flows weighted by the reserve balance for each cohort.

We updated our actuarial assumptions during the third quarter of 2024, resulting in a $32.3 million increase in the LFPB and an $18.2 million decrease to income before taxes, net of reinsurance, for Individual disability. This was primarily due to unfavorable updates to termination and lapse assumptions. The updates also resulted in a $68.2 million increase in the LFPB and a $52.9 million decrease to income before taxes, net of reinsurance, for Term life. This was primarily due to unfavorable updates to mortality and lapse assumptions.

We updated our actuarial assumptions during the third quarter of 2023, resulting in a $13.9 million decrease in the LFPB and a $10.2 million increase to income before taxes, net of reinsurance, for Individual disability. This was primarily due to favorable updates to claim incidence assumptions. The updates also resulted in a $38.3 million increase in the LFPB and a $25.4 million decrease to income before taxes, net of reinsurance, for Term life. This was primarily due to unfavorable updates to mortality assumptions.

Additional Liability for Certain Benefit Features

The LFPB also includes an additional reserve on certain universal life contracts where benefit features result in gains in early years followed by losses in later years. The liability for these future losses is accrued in relation to estimated contract assessments. A premium deficiency exists if the net liabilities together with future premiums are determined to be insufficient to provide for expected future policy benefits. Premium deficiency testing considers, among other factors, anticipated investment income and does not include a provision for adverse deviation. We did not have a premium deficiency reserve as of December 31, 2024 or December 31, 2023.

The balances and the changes in the additional liability for certain benefit features for Life Insurance – Universal life contracts, excluding the impact of unrealized gains (losses), were as follows:


	For the year ended		For the year ended
	December 31, 2024		December 31, 2023

	($ in millions)
Balance at beginning of period	$	5,326.5	$	4,095.2
Effect of changes in cash flow assumptions		151.9		725.4
Effect of actual variances from expected experience		28.0		45.2
Interest accrual		253.3		209.2
Net assessments collected		425.2		378.1
Benefit payments		(147.7)		(126.6)
Balance at end of period		6,037.2		5,326.5
Reinsurance impact		(6,011.3)		(5,306.2)
Balance at end of period after reinsurance	$	25.9	$	20.3

Weighted-average duration for additional liability (years) (1)		23.3		26.2

(1)	Represents the average of the cohort-level duration of the benefits less the net assessment cash flows weighted by the reserve balance for each cohort.

We updated our actuarial assumptions during the third quarter of 2024, resulting in a $151.9 million increase in the additional liability for certain benefit features primarily due to mortality assumptions related to ULSG products, resulting in a $0.3 million decrease to income before taxes, net of reinsurance.

We updated our actuarial assumptions during the third quarter of 2023, resulting in a $725.4 million increase in the additional liability for certain benefit features primarily due to policyholder lapse behavior assumptions related to ULSG products, resulting in a $13.1 million decrease to income before taxes, net of reinsurance.

Corporate

The balances and the changes in the present value for expected net premiums and expected future policy benefits for long-term care insurance were as follows:


	For the year ended		For the year ended
	December 31, 2024		December 31, 2023

	($ in millions)
Present value of expected net premiums
Balance at beginning of period	$	42.8	$	64.6
Effect of changes in discount rate assumptions at beginning of period		(3.0)		(3.6)
Balance at beginning of period at original discount rate		39.8		61.0
Effect of changes in cash flow assumptions		(5.3)		(13.3)
Effect of actual variances from expected experience		(2.2)		(5.7)
Adjusted beginning of period balance at original discount rate		32.3		42.0
Interest accrual		1.9		2.9
Net premiums collected		(4.7)		(5.1)
Balance at end of period at original discount rate		29.5		39.8
Effect of changes in discount rate assumptions at end of period		1.3		3.0
Balance at end of period	$	30.8	$	42.8

Present value of expected future policy benefit payments
Balance at beginning of period	$	209.5	$	248.1
Effect of changes in discount rate assumptions at beginning of period		(20.0)		(18.9)
Balance at beginning of period at original discount rate		189.5		229.2
Effect of changes in cash flow assumptions		(1.2)		(40.5)
Effect of actual variances from expected experience		2.5		2.5
Adjusted beginning of period balance at original discount rate		190.8		191.2
Interest accrual		11.2		12.5
Benefit payments		(15.2)		(14.2)
Balance at end of period at original discount rate		186.8		189.5
Effect of changes in discount rate assumptions at end of period		8.8		20.0
Balance at end of period	$	195.6	$	209.5

Future policy benefits (1)	$	164.8	$	166.7
Reinsurance impact		(164.8)		(166.7)
Future policy benefits after reinsurance	$	—	$	—

Weighted-average duration for future policy benefits (years) (2)		9.3		10.4

(1)	Represents the present value of expected future policy benefit payments less the present value of expected net premiums.

(2)	Represents the average of cohort-level duration of the benefits less the net premium cash flows weighted by the reserve balance for each cohort.

Expected Future Gross Premiums and Benefit Payments

The amounts of expected undiscounted future benefit payments, expected undiscounted future gross premiums and expected discounted future gross premiums, utilizing the current upper-medium fixed-income instrument yield, were as follows:


	December 31, 2024		December 31, 2023

	(in millions)
Retirement and Income Solutions:
Pension risk transfer
Expected undiscounted future benefit payments	$	39,532.3	$	36,325.5

Individual fixed income annuities
Expected undiscounted future benefit payments	$	6,622.6	$	7,292.0

Principal Asset Management – International Pension:
Latin America:
Individual fixed income annuities
Expected undiscounted future benefit payments	$	5,509.1	$	6,296.0

Benefits and Protection – Specialty Benefits:
Individual disability
Expected discounted future gross premiums	$	5,484.0	$	5,456.4
Expected undiscounted future gross premiums	$	8,680.0	$	8,264.8
Expected undiscounted future benefit payments	$	9,808.8	$	8,981.2

Benefits and Protection – Life Insurance:
Term life
Expected discounted future gross premiums	$	6,651.2	$	6,385.1
Expected undiscounted future gross premiums	$	11,391.4	$	10,287.2
Expected undiscounted future benefit payments	$	8,970.7	$	7,832.3

Corporate:
Long-term care insurance
Expected discounted future gross premiums	$	38.4	$	42.8
Expected undiscounted future gross premiums	$	55.7	$	60.3
Expected undiscounted future benefit payments	$	357.3	$	371.0

Interest Accretion and Current Discount Rates

The interest accretion rate shown for each level of aggregation is an average of the cohort-level accretion rates weighted by the reserve balance for each cohort within that level of aggregation. The current discount rate is calculated at a cohort-level based on current upper-medium fixed-income instrument yields and weighted by the reserve balance for each cohort within each level of aggregation. The weighted-average rates were as follows:


	Interest accretion rate				Current discount rate
	December 31, 2024		December 31, 2023		December 31, 2024		December 31, 2023
Retirement and Income Solutions:
Pension risk transfer	4.61	%	4.52	%	5.55	%	4.99	%
Individual fixed income annuities	4.22	%	4.22	%	5.50	%	4.97	%
Principal Asset Management - International
Pension (1):
Latin America:
Individual fixed income annuities	4.21	%	4.22	%	3.04	%	3.23	%
Benefits and Protection:
Specialty Benefits:
Individual disability	3.89	%	3.96	%	5.64	%	5.05	%
Life Insurance:
Universal life	4.75	%	4.75	%	See note (2)		See note (2)
Term life	4.82	%	4.83	%	5.35	%	4.90	%
Corporate:
Long-term care insurance	6.16	%	6.16	%	5.58	%	5.01	%

(1)	The interest accretion rate and current discount rate are Chilean real rates, excluding inflation, in the local currency.

(2)	The additional liability for certain benefit features for Life Insurance – Universal life is measured using the discount rate at contract inception. Therefore, the current discount rate is not applicable for this product.