EX-99.2 3 fg3q2021financialsupplemen.htm EX-99.2
Exhibit 99.2
F&G Annuities & Life, Inc. (“F&G”) - An Operating Segment of Fidelity National Financial, Inc. (NYSE:FNF)
Financial Supplement
September 30, 2021
(Year Ended December 31)
The financial statements and financial exhibits included herein are unaudited. F&G is an operating segment of FNF (the Company) and these financial statements and exhibits should be read in conjunction with the Company's periodic reports on Form 10-K, Form 10-Q and Form 8-K.
F&G (formerly NYSE:FG) was acquired by FNF (the "Business Combination") on June 1, 2020 ("Closing Date"). As a result of the Business Combination, F&G delisted from the NYSE and became a subsidiary of FNF.
All dollar amounts are presented in millions.
Non-GAAP Financial Measures
This document contains certain non-GAAP financial measures commonly used in our industry that, together with the relevant GAAP measures, may enhance a user’s ability to analyze the Company's operating performance and capital position for the periods presented. These measures should be considered supplementary to our results in accordance with GAAP and should not be viewed as a substitute for the GAAP measures and are not intended to replace GAAP financial results. Our non-GAAP measures may not be comparable to similarly titled measures of other organizations because other organizations may not calculate such non-GAAP measures in the same manner. Refer to the non-GAAP measures reconciliations and definitions within for further information.
1

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)

| Page
A. Financial Highlights |
Consolidated Financial Highlights | 3
Sales Results by Product | 3
Condensed Consolidated Balance Sheets | 4
Reconciliation of Total Shareholders' Equity to Total Shareholders' Equity Excluding AOCI | 5
Condensed Consolidated Statements of Operations | 6
Reconciliation from Net Earnings (Loss) to Adjusted Net Earnings | 7
Notable Items | 7
Adjusted Net Earnings Statement | 8
Financial Strength Ratings | 9
Total Product Net Investment Spread | 10
FIA Net Investment Spread | 11
B. Product Summary |
Average Assets Under Management Rollforward | 12
Annuity Account Balance Rollforward | 12
Annuity Liability Characteristics | 13
C. Investment Summary |
Summary of Invested Assets by Asset Class | 14
Credit Quality of Fixed Maturity Securities | 15
Summary of Residential Mortgage Backed Securities by Collateral Type and NAIC Designation | 16
D. Counterparty Risk |
Top 5 Reinsurers | 16
E. Non-GAAP Financial Measures Definitions | 17

2

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Consolidated Financial Highlights

| Three months ended |  |  |  |  |  | Nine months ended |  |  |  |
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  |  |  |  | September 30, 2021 |  |  |  |  |  |
Select Income Statement Data: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net earnings (loss) attributable to common shareholders | 373 |  |  | 82 |  |  | 289 |  |  | 137 |  |  | 38 |  |  |  |  |  |  | 744 |  |  |  |  |  |  |
Adjusted net earnings from continuing operations attributable to common shareholders (1) | 101 |  |  | 92 |  |  | 78 |  |  | 128 |  |  | 74 |  |  |  |  |  |  | 271 |  |  |  |  |  |  |
Select Metrics: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Average Assets Under Management ("AAUM") (1) | 32,692 |  |  | 30,423 |  |  | 29,016 |  |  | 27,864 |  |  | 26,990 |  |  |  |  |  |  | 30,706 |  |  |  |  |  |  |
Net investment spread (1) | 2.85 | % |  | 2.95 | % |  | 2.55 | % |  | 2.55 | % |  | 2.62 | % |  |  |  |  |  | 2.78 | % |  |  |  |  |  |

(1) Refer to "Non-GAAP Financial Measures Definitions"
Sales Results by Product
The table below provides a summary of sales, which are not affected by the June 1, 2020 Business Combination, and are comparable to prior period data.

| Three months ended |  |  | Nine months ended |  |  |  | Nine months ended |  |  |  |  |  |  |
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  | September 30, 2021 |  |  |  | September 30, 2020 |  |  |  |  |  |  |  |  |  |
Sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed indexed annuities (FIA) | 1,073 |  |  | 1,135 |  |  | 1,047 |  |  | 947 |  |  | 815 |  |  |  | 3,255 |  |  |  |  | 2,512 |  |  |  |  |  |  |  |  |  |  |
Fixed rate annuities (MYGA) | 458 |  |  | 512 |  |  | 467 |  |  | 362 |  |  | 253 |  |  |  | 1,437 |  |  |  |  | 414 |  |  |  |  |  |  |  |  |  |  |
Total annuity | 1,531 |  |  | 1,647 |  |  | 1,514 |  |  | 1,309 |  |  | 1,068 |  |  |  | 4,692 |  |  |  |  | 2,926 |  |  |  |  |  |  |  |  |  |  |
Index universal life (IUL) | 24 |  |  | 20 |  |  | 15 |  |  | 13 |  |  | 14 |  |  |  | 59 |  |  |  |  | 37 |  |  |  |  |  |  |  |  |  |  |
Funding agreements (FABN/FHLB) | 1,150 |  |  | 1,000 |  |  | 125 |  |  | 100 |  |  | — |  |  |  | 2,275 |  |  |  |  | 100 |  |  |  |  |  |  |  |  |  |  |
Pension risk transfer (PRT) | 371 |  |  | — |  |  | — |  |  | — |  |  | — |  |  |  | 371 |  |  |  |  | — |  |  |  |  |  |  |  |  |  |  |
Flow reinsurance | — |  |  | — |  |  | — |  |  | 37 |  |  | 51 |  |  | — |  | — |  |  |  |  | 315 |  |  |  |  |  |  |  |  |  |  |
Total Sales | $ | 3,076 |  |  | $ | 2,667 |  |  | $ | 1,654 |  |  | $ | 1,459 |  |  | $ | 1,133 |  |  |  | $ | 7,397 |  |  |  |  | $ | 3,378 |  |  |  |  |  |  |  |  |  |  |

3

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Condensed Consolidated Balance Sheets

| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020
Assets |  |  |  |  |  |  |  |  |
Investments: |  |  |  |  |  |  |  |  |
Fixed maturity securities available for sale, at fair value, net of allowance for credit losses of $7 at September 30, 2021 | $ | 28,550 |  |  | $ | 27,616 |  |  | $ | 25,768 |  |  | $ | 25,499 |  |  | $ | 24,218 |
Preferred securities, at fair value | 870 |  |  | 882 |  |  | 908 |  |  | 965 |  |  | 917 |
Equity securities, at fair value | 156 |  |  | 176 |  |  | 141 |  |  | 82 |  |  | 54 |
Derivative investments | 581 |  |  | 691 |  |  | 542 |  |  | 548 |  |  | 381 |
Mortgage loans, net of allowance for credit losses of $33 at September 30, 2021 | 3,484 |  |  | 2,794 |  |  | 2,374 |  |  | 2,031 |  |  | 1,614 |
Investments in unconsolidated affiliates (a) | 2,022 |  |  | 1,667 |  |  | 1,281 |  |  | 1,156 |  |  | 1,125 |
Other long-term investments | 454 |  |  | 448 |  |  | 447 |  |  | 449 |  |  | 438 |
Short-term investments | 258 |  |  | 356 |  |  | 72 |  |  | 456 |  |  | 34 |
Total investments | $ | 36,375 |  |  | $ | 34,630 |  |  | $ | 31,533 |  |  | $ | 31,186 |  |  | $ | 28,781 |
Cash and cash equivalents | 2,320 |  |  | 1,016 |  |  | 995 |  |  | 889 |  |  | 1,014 |
Trade and notes receivables | 11 |  |  | 11 |  |  | 11 |  |  | 10 |  |  | 2 |
Reinsurance recoverable, net of allowance for credit losses of $19 at September 30, 2021 (a) | 3,492 |  |  | 3,297 |  |  | 3,404 |  |  | 3,174 |  |  | 3,152 |
Goodwill (a) | 1,756 |  |  | 1,756 |  |  | 1,751 |  |  | 1,751 |  |  | 1,731 |
Prepaid expenses and other assets | 662 |  |  | 415 |  |  | 470 |  |  | 413 |  |  | 448 |
Lease assets | 8 |  |  | 8 |  |  | 8 |  |  | 8 |  |  | 7 |
Other intangible assets, net (a) | 2,086 |  |  | 2,060 |  |  | 2,061 |  |  | 1,918 |  |  | 1,956 |
Property and equipment, net | 13 |  |  | 13 |  |  | 13 |  |  | 11 |  |  | 7 |
Income taxes receivable | — |  |  | — |  |  | — |  |  | 15 |  |  | 19 |
Deferred tax asset (a) | — |  |  | 51 |  |  | 130 |  |  | 44 |  |  | 107 |
Assets of discontinued operations | — |  |  | — |  |  | 311 |  |  | 327 |  |  | 2,618 |
Total assets | $ | 46,723 |  |  | $ | 43,257 |  |  | $ | 40,687 |  |  | $ | 39,746 |  |  | $ | 39,842 |
(a) These line items included adjustments that were recorded during the remeasurement period subsequent to the June 1, 2020 acquisition. The following adjustments were recorded as of the opening balance sheet at June 1, 2020 during the quarter ending September 30, 2020: Investment in unconsolidated affiliates, $31, Goodwill, $6, Other intangible assets, net, ($37), and Deferred tax asset, $3. The following adjustments were recorded as of the opening balance sheet at June 1, 2020 during the quarter ending December 31, 2020: Goodwill, $20, Other intangible assets, net, ($56), Reinsurance recoverable, $47, and Deferred tax asset, $10. The following adjustments were recorded as of the opening balance sheet at June 1, 2020 during the quarter ending June 30, 2021: Reinsurance recoverable, ($289), Goodwill, $5, Other intangible assets, net, $61, and Deferred tax asset, $1.

4

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)

Condensed Consolidated Balance Sheets (continued)
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020
Liabilities and Shareholders' Equity |  |  |  |  |  |  |  |  |
Contractholder funds (a) | $ | 33,988 |  |  | $ | 32,166 |  |  | $ | 29,592 |  |  | $ | 28,718 |  |  | $ | 27,488 |
Future policy benefits (a) | 3,985 |  |  | 3,670 |  |  | 3,959 |  |  | 4,010 |  |  | 4,048 |
Accounts payable and accrued liabilities (a) | 1,670 |  |  | 1,276 |  |  | 1,368 |  |  | 1,174 |  |  | 1,056 |
Income taxes payable | 3 |  |  | 17 |  |  | 5 |  |  | — |  |  | — |
Deferred tax liability | 9 |  |  | — |  |  | — |  |  | — |  |  | — |
Notes payable | 979 |  |  | 589 |  |  | 589 |  |  | 589 |  |  | 589 |
Funds withheld for reinsurance liabilities | 1,508 |  |  | 1,271 |  |  | 1,026 |  |  | 806 |  |  | 814 |
Lease liabilities | 14 |  |  | 14 |  |  | 14 |  |  | 14 |  |  | 12 |
Liabilities of discontinued operations | — |  |  | — |  |  | 339 |  |  | 361 |  |  | 2,462 |
Total liabilities | $ | 42,156 |  |  | $ | 39,003 |  |  | $ | 36,892 |  |  | $ | 35,672 |  |  | $ | 36,469 |
Shareholders' equity: |  |  |  |  |  |  |  |  |
Additional paid-in-capital | 2,748 |  |  | 2,746 |  |  | 2,744 |  |  | 2,741 |  |  | 2,739 |
Retained earnings (accumulated deficit) | 880 |  |  | 507 |  |  | 425 |  |  | 136 |  |  | (1) |
Accumulated other comprehensive income (loss) ("AOCI") | 939 |  |  | 1,001 |  |  | 626 |  |  | 1,197 |  |  | 635 |
Total shareholders' equity | $ | 4,567 |  |  | $ | 4,254 |  |  | $ | 3,795 |  |  | $ | 4,074 |  |  | $ | 3,373 |
Total liabilities and shareholders' equity | $ | 46,723 |  |  | $ | 43,257 |  |  | $ | 40,687 |  |  | $ | 39,746 |  |  | $ | 39,842 |

(a) Contractholder funds included a $3 adjustment that was recorded as of the opening balance sheet at June 1, 2020 during the quarter ending September 30, 2020; Contractholder funds, Future policy benefits, and Accounts payable and accrued liabilities included ($5), ($7), and $33 adjustments as of the opening balance sheet at June 1, 2020, respectively, during the quarter ending December 31, 2020; Additionally, Future policy benefits and Accounts payable and accrued liabilities included ($228) and $6 adjustments as of the opening balance sheet at June 1, 2020, respectively, during the quarter ending June 30, 2021
Reconciliation of Total Shareholders' Equity to Total Shareholders' Equity Excluding AOCI

| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |
Total shareholders' equity | $ | 4,567 |  |  | $ | 4,254 |  |  | $ | 3,795 |  |  | $ | 4,074 |  |  | $ | 3,373 |  |  |
AOCI | 939 |  |  | 1,001 |  |  | 626 |  |  | 1,197 |  |  | 635 |  |  |
Total shareholders' equity excluding AOCI (1) | $ | 3,628 |  |  | $ | 3,253 |  |  | $ | 3,169 |  |  | $ | 2,877 |  |  | $ | 2,738 |  |  |
(1) Refer to "Non-GAAP Financial Measures Definitions"

5

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Condensed Consolidated Statements of Operations

| Three months ended |  |  |  |  |  |  |  |  | Nine months ended |  |  |
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  |  |  |  |  |  |  | September 30, 2021 |  |  |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Life insurance premiums and other fees (a) | $ | 431 |  |  | $ | 62 |  |  | $ | 64 |  |  | $ | 58 |  |  | $ | 60 |  |  |  |  |  |  |  |  |  | $ | 557 |  |  |  |
Interest and investment income | 481 |  |  | 487 |  |  | 373 |  |  | 327 |  |  | 305 |  |  |  |  |  |  |  |  |  | 1,341 |  |  |  |
Recognized gains and losses, net | 15 |  |  | 253 |  |  | 102 |  |  | 282 |  |  | 77 |  |  |  |  |  |  |  |  |  | 370 |  |  |  |
Total revenues | 927 |  |  | 802 |  |  | 539 |  |  | 667 |  |  | 442 |  |  |  |  |  |  |  |  |  | 2,268 |  |  |  |
Benefits and expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Benefits and other changes in policy reserves | 185 |  |  | 575 |  |  | (26) |  |  | 460 |  |  | 251 |  |  |  |  |  |  |  |  |  | 734 |  |  |  |
Personnel costs | 32 |  |  | 32 |  |  | 29 |  |  | 33 |  |  | 23 |  |  |  |  |  |  |  |  |  | 93 |  |  |  |
Other operating expenses | 22 |  |  | 26 |  |  | 28 |  |  | 30 |  |  | 33 |  |  |  |  |  |  |  |  |  | 76 |  |  |  |
Depreciation and amortization | 210 |  |  | 65 |  |  | 144 |  |  | 64 |  |  | 56 |  |  |  |  |  |  |  |  |  | 419 |  |  |  |
Interest expense | 6 |  |  | 7 |  |  | 8 |  |  | 8 |  |  | 7 |  |  |  |  |  |  |  |  |  | 21 |  |  |  |
Total benefits and expenses | 455 |  |  | 705 |  |  | 183 |  |  | 595 |  |  | 370 |  |  |  |  |  |  |  |  |  | 1,343 |  |  |  |
Pre-tax earnings (loss) from continuing operations | 472 |  |  | 97 |  |  | 356 |  |  | 72 |  |  | 72 |  |  |  |  |  |  |  |  |  | 925 |  |  |  |
Income tax expense | (96) |  |  | (21) |  |  | (72) |  |  | 67 |  |  | (6) |  |  |  |  |  |  |  |  |  | (189) |  |  |  |
Net earnings (loss) from continuing operations | 376 |  |  | 76 |  |  | 284 |  |  | 139 |  |  | 66 |  |  |  |  |  |  |  |  |  | 736 |  |  |  |
Earnings from discontinued operations, net of tax | (3) |  |  | 6 |  |  | 5 |  |  | (2) |  |  | (28) |  |  |  |  |  |  |  |  |  | 8 |  |  |  |
Net earnings (loss) attributable to common shareholders | $ | 373 |  |  | $ | 82 |  |  | $ | 289 |  |  | $ | 137 |  |  | $ | 38 |  |  |  |  |  |  |  |  |  | $ | 744 |  |  |  |

(a) Included within "Escrow, title-related and other fees" in FNF 10-K/ 10-Q
6

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Reconciliation from Net Earnings (Loss) to Adjusted Net Earnings (1)

| Three Months Ended |  |  |  |  |  |  |  | Nine months ended |
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  |  |  |  |  |  | September 30, 2021 |
Net earnings (loss) from continuing operations | $ | 376 |  |  | $ | 76 |  |  | $ | 284 |  |  | $ | 139 |  |  | $ | 66 |  |  |  |  |  |  |  |  | $ | 736 |  |
Non-GAAP adjustments (1): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Recognized (gains) and losses, net | (98) |  |  | (63) |  |  | (82) |  |  | (76) |  |  | (15) |  |  |  |  |  |  |  |  | (243) |  |
Indexed product related derivatives | 26 |  |  | 75 |  |  | (185) |  |  | 54 |  |  | 14 |  |  |  |  |  |  |  |  | (84) |  |
Purchase price amortization | 7 |  |  | 6 |  |  | 7 |  |  | 7 |  |  | 7 |  |  |  |  |  |  |  |  | 20 |  |
Transaction costs | 1 |  |  | 2 |  |  | 2 |  |  | 4 |  |  | 10 |  |  |  |  |  |  |  |  | 5 |  |
Other non-recurring items (2) | (284) |  |  | — |  |  | — |  |  | — |  |  | — |  |  |  |  |  |  |  |  | (284) |  |
Income taxes on non-GAAP adjustments | 73 |  |  | (4) |  |  | 52 |  |  | — |  |  | (8) |  |  |  |  |  |  |  |  | 121 |  |
Adjusted net earnings from continuing operations attributable to common shareholders (1) | $ | 101 |  |  | $ | 92 |  |  | $ | 78 |  |  | $ | 128 |  |  | $ | 74 |  |  |  |  |  |  |  |  | $ | 271 |  |

Notable Items
Each quarterly reporting period, we identify notable items that help explain the trends in our Net earnings (loss) from continuing operations attributable to common shareholders and Adjusted net earnings (loss) from continuing operations attributable to common shareholders as we believe these items provide further clarity to the financial performance of the business.

| Three Months Ended |  |  |  |  |  |  |  |  | Nine months ended |
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  |  |  |  |  |  |  | September 30, 2021 |
Adjusted net earnings from continuing operations attributable to common shareholders (1) | $ | 101 |  |  | $ | 92 |  |  | $ | 78 |  |  | $ | 128 |  |  | $ | 74 |  |  |  |  |  |  |  |  |  | $ | 271 |  |
Notable items [(unfavorable)/favorable] |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Single premium immediate annuities ("SPIA") mortality & other reserve adjustments (a) | 7 |  |  | 3 |  |  | 7 |  |  | — |  |  | 10 |  |  |  |  |  |  |  |  |  | 17 |  |
Assumption review and unlocking (b) | — |  |  | 8 |  |  | — |  |  | — |  |  | — |  |  |  |  |  |  |  |  |  | 8 |  |
Other notable items (c) | 20 |  |  | 11 |  |  | 5 |  |  | 68 |  |  | — |  |  |  |  |  |  |  |  |  | 36 |  |

(1) Refer to "Non-GAAP Financial Measures Definitions"
(2) Reflects adjustments to benefits and other changes in policy reserves and depreciation and amortization resulting from the implementation of a new actuarial valuation system.
(a) The release of annuity reserves associated with mortality of annuitants, which varies due to timing, volume and severity of experience, and other reserve adjustments.
(b) Reflects unlocking from updating our DAC, VOBA, DSI and cost of reinsurance amortization models for actual experience and equity market fluctuations.
(c) Costs incurred during research and exploration of potential merger or acquisition of a business or a group of insurance policies via asset acquisition or (inforce) reinsurance agreement, income from bond prepayment and CLO redemptions, changes in tax valuation and other net activity.
7

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Adjusted Net Earnings Statement (1)

| Three Months Ended |  |  |  |  |  |  |  | Nine months ended
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  |  |  |  |  |  | September 30, 2021 |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Life insurance premiums and other fees (a) | $ | 430 |  |  | $ | 62 |  |  | $ | 64 |  |  | $ | 61 |  |  | $ | 60 |  |  |  |  |  |  |  |  | $ | 556 |  |
Interest and investment income (b) | 381 |  |  | 377 |  |  | 333 |  |  | 315 |  |  | 314 |  |  |  |  |  |  |  |  | 1,091 |  |
Recognized gains and losses, net (c) | — |  |  | — |  |  | — |  |  | — |  |  | (1) |  |  |  |  |  |  |  |  | — |  |
Total revenues | 811 |  |  | 439 |  |  | 397 |  |  | 376 |  |  | 373 |  |  |  |  |  |  |  |  | 1,647 |  |
Benefits and expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Benefits and other changes in policy reserves (d) | 577 |  |  | 214 |  |  | 188 |  |  | 202 |  |  | 177 |  |  |  |  |  |  |  |  | 979 |  |
Personnel costs | 32 |  |  | 32 |  |  | 29 |  |  | 33 |  |  | 23 |  |  |  |  |  |  |  |  | 93 |  |
Other operating expenses (e) | 22 |  |  | 24 |  |  | 26 |  |  | 25 |  |  | 23 |  |  |  |  |  |  |  |  | 72 |  |
Depreciation and amortization (f) | 49 |  |  | 46 |  |  | 48 |  |  | 46 |  |  | 56 |  |  |  |  |  |  |  |  | 143 |  |
Interest expense | 6 |  |  | 7 |  |  | 8 |  |  | 8 |  |  | 7 |  |  |  |  |  |  |  |  | 21 |  |
Total benefits and expenses | 686 |  |  | 323 |  |  | 299 |  |  | 314 |  |  | 286 |  |  |  |  |  |  |  |  | 1,308 |  |
Pre-tax earnings (loss) from continuing operations | 125 |  |  | 116 |  |  | 98 |  |  | 62 |  |  | 87 |  |  |  |  |  |  |  |  | 339 |  |
Income tax expense | (24) |  |  | (24) |  |  | (20) |  |  | 66 |  |  | (13) |  |  |  |  |  |  |  |  | (68) |  |
Adjusted net earnings from continuing operations attributable to common shareholders (1) | $ | 101 |  |  | $ | 92 |  |  | $ | 78 |  |  | $ | 128 |  |  | $ | 74 |  |  |  |  |  |  |  |  | $ | 271 |  |
Notable items included in adjusted net earnings attributable to common shareholders (2) | $ | 27 |  |  | $ | 22 |  |  | $ | 12 |  |  | $ | 68 |  |  | $ | 10 |  |  |  |  |  |  |  |  | $ | 61 |  |

(1) Refer to "Non-GAAP Financial Measures Definitions"
(2) Refer to page 7 "Notable Items" for further detail of notable items.
(a) Life insurance premiums and other fees are included within "Escrow, title-related and other fees" in FNF 10-K/ 10-Q, and have been adjusted here to remove the effect of cost of reinsurance.
(b) Interest and investment income has been adjusted to remove the market volatility on the alternative investment portfolio.
(c) Recognized gains and losses (net) have been adjusted to remove the effect of recognized (gains) losses including changes in allowance for expected credit losses and OTTI; changes in fair values of indexed product related derivatives and embedded derivatives, net of hedging costs; and the change in fair value of the reinsurance related embedded derivative.
(d) Benefits and other changes in policy reserves has been adjusted to remove the effects of the changes in fair values of indexed product embedded derivatives, changes in allowance for expected credit losses on reinsurance recoverables, the fair value impacts of assumed reinsurance, those resulting from the implementation of a new actuarial system at September 30, 2021, and changes in the SOP 03-1 reserve resulting from the adjustments above, as applicable.
(e) Other operating expenses have been adjusted to remove the effects of transaction costs.
(f) Depreciation and amortization has been adjusted to remove the impact on DAC, VOBA, and DSI of the adjustments above, as applicable, purchase price amortization and those resulting from the implementation of a new actuarial valuation system at September 30, 2021.
8

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Financial Strength Ratings

|  | A.M. Best |  | S&P |  | Fitch |  | Moody's
Holding Company Ratings |  |  |  |  |  |  |  |
F&G Annuities & Life, Inc. (formerly known as FGL Holdings) |  |  |  |  |  |  |  |
Issuer Credit / Default Rating |  | Not Rated |  | BBB- |  | BBB |  | Ba2
Outlook |  |  |  | Stable |  | Stable |  | Stable
CF Bermuda Holdings Limited |  |  |  |  |  |  |  |
Issuer Credit / Default Rating |  | Not Rated |  | BBB- |  | BBB |  | Ba1
Outlook |  |  |  | Stable |  | Stable |  | Stable
Fidelity & Guaranty Life Holdings, Inc. |  |  |  |  |  |  |  |
Issuer Credit / Default Rating |  | bbb- |  | BBB- |  | BBB |  | Not Rated
Outlook |  | Stable |  | Stable |  | Stable |  |
Senior Unsecured Notes |  | bbb- |  | BBB |  | BBB |  | Baa2
Outlook |  | Stable |  |  |  |  |  | Stable
Operating Subsidiary Ratings |  |  |  |  |  |  |  |
Fidelity & Guaranty Life Insurance Company |  |  |  |  |  |  |  |
Financial Strength Rating |  | A- |  | A- |  | A- |  | Baa1
Outlook |  | Stable |  | Stable |  | Stable |  | Stable
Fidelity & Guaranty Life Insurance Company of New York |  |  |  |  |  |  |  |
Financial Strength Rating |  | A- |  | A- |  | A- |  | Not Rated
Outlook |  | Stable |  | Stable |  | Stable |  |
F&G Life Re Ltd |  |  |  |  |  |  |  |
Financial Strength Rating |  | Not Rated |  | A- |  | A- |  | Baa1
Outlook |  |  |  | Stable |  | Stable |  | Stable
F&G Cayman Re Ltd |  |  |  |  |  |  |  |
Financial Strength Rating |  | Not Rated |  | Not Rated |  | A- |  | Not Rated
Outlook |  |  |  |  |  | Stable |  |

9

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)

Total Product Net Investment Spread |  |  |  |  |
| Three Months Ended |  |  |  |  |  |  |  | Nine months ended
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  |  |  |  |  |  | September 30, 2021 |
Net investment income | $ | 481 |  |  | $ | 487 |  |  | $ | 373 |  |  | $ | 327 |  |  | $ | 305 |  |  |  |  |  |  |  |  | $ | 1,341 |  |
AAUM (1) | 32,692 |  |  | 30,423 |  |  | 29,016 |  |  | 27,864 |  |  | 26,990 |  |  |  |  |  |  |  |  | 30,706 |  |
Yield on AAUM (1) | 5.89 | % |  | 6.40 | % |  | 5.15 | % |  | 4.69 | % |  | 4.52 | % |  |  |  |  |  |  |  | 5.82 | % |
Alternative investment yield adjustment (1) | (1.23) | % |  | (1.43) | % |  | (0.56) | % |  | (0.17) | % |  | 0.13 | % |  |  |  |  |  |  |  | (1.09) | % |
Adjusted Yield on AAUM (1) | 4.66 | % |  | 4.97 | % |  | 4.59 | % |  | 4.52 | % |  | 4.65 | % |  |  |  |  |  |  |  | 4.73 | % |
Interest credits | $ | 63 |  |  | $ | 73 |  |  | $ | 74 |  |  | $ | 67 |  |  | $ | 67 |  |  |  |  |  |  |  |  | $ | 210 |  |
Option & futures costs | 75 |  |  | 70 |  |  | 65 |  |  | 63 |  |  | 64 |  |  |  |  |  |  |  |  | 210 |  |
Total interest credited and option costs | $ | 138 |  |  | $ | 143 |  |  | $ | 139 |  |  | $ | 130 |  |  | $ | 131 |  |  |  |  |  |  |  |  | $ | 420 |  |
Average account value | 30,469 |  |  | 28,273 |  |  | 27,252 |  |  | 26,450 |  |  | 25,688 |  |  |  |  |  |  |  |  | 28,766 |  |
Interest credited & option cost | 1.81 | % |  | 2.02 | % |  | 2.04 | % |  | 1.97 | % |  | 2.03 | % |  |  |  |  |  |  |  | 1.95 | % |
Net investment spread (1) | 2.85 | % |  | 2.95 | % |  | 2.55 | % |  | 2.55 | % |  | 2.62 | % |  |  |  |  |  |  |  | 2.78 | % |
(1) Refer to "Non-GAAP Financial Measures Definitions" for further details. |  |  |  |  |

10

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)

FIA Net Investment Spread |  |  |  |  |
| Three Months Ended |  |  |  |  |  |  |  | Nine months ended
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  |  |  |  |  |  | September 30, 2021 |
Net investment income (1) | $ | 368 |  |  | $ | 377 |  |  | $ | 276 |  |  | $ | 235 |  |  | $ | 215 |  |  |  |  |  |  |  |  | $ | 1,021 |  |
AAUM (2) | 22,146 |  |  | 20,896 |  |  | 20,217 |  |  | 19,097 |  |  | 18,312 |  |  |  |  |  |  |  |  | 21,097 |  |
Yield on AAUM (1) (2) | 6.65 | % |  | 7.22 | % |  | 5.46 | % |  | 4.92 | % |  | 4.70 | % |  |  |  |  |  |  |  | 6.45 | % |
Alternative investment yield adjustment (2) | (1.81) | % |  | (2.20) | % |  | (0.81) | % |  | (0.25) | % |  | 0.20 | % |  |  |  |  |  |  |  | (1.62) | % |
Adjusted Yield on AAUM (1) (2) | 4.84 | % |  | 5.02 | % |  | 4.65 | % |  | 4.67 | % |  | 4.90 | % |  |  |  |  |  |  |  | 4.83 | % |
Interest credits | $ | 2 |  |  | $ | 13 |  |  | $ | 15 |  |  | $ | 13 |  |  | $ | 14 |  |  |  |  |  |  |  |  | $ | 30 |  |
Option & futures costs | 75 |  |  | 70 |  |  | 65 |  |  | 63 |  |  | 64 |  |  |  |  |  |  |  |  | 210 |  |
Total interest credited and option costs | $ | 77 |  |  | $ | 83 |  |  | $ | 80 |  |  | $ | 76 |  |  | $ | 78 |  |  |  |  |  |  |  |  | $ | 240 |  |
Average account value | 20,680 |  |  | 19,842 |  |  | 19,028 |  |  | 18,442 |  |  | 17,948 |  |  |  |  |  |  |  |  | 19,856 |  |
Interest credited & option cost | 1.49 | % |  | 1.67 | % |  | 1.67 | % |  | 1.65 | % |  | 1.73 | % |  |  |  |  |  |  |  | 1.61 | % |
Net investment spread (1) (2) | 3.35 | % |  | 3.35 | % |  | 2.98 | % |  | 3.02 | % |  | 3.17 | % |  |  |  |  |  |  |  | 3.22 | % |

(1) In December 2020, we restated prior period FIA net investment spread to reflect immaterial updates to FIA net investment income amounts. There was no impact to total product net investment spread amounts.
(2) Refer to "Non-GAAP Financial Measures Definitions" for further details.

11

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Average Assets Under Management Rollforward

| Three Months Ended |  |  |  |  |  | Nine months ended
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  |  |  |  | September 30, 2021 |
AAUM at beginning of period (1) | $ | 30,423 |  |  | $ | 29,016 |  |  | $ | 27,864 |  |  | $ | 26,990 |  |  | $ | 26,582 |  |  |  |  |  |  | $ | 27,322 |  |
Net new business sales | 2,524 |  |  | 1,668 |  |  | 1,197 |  |  | 874 |  |  | 408 |  |  |  |  |  |  | 3,764 |  |
Net reinsurance transactions and other | (255) |  |  | (261) |  |  | (45) |  |  | — |  |  | — |  |  |  |  |  |  | (380) |  |
AAUM at end of period | $ | 32,692 |  |  | $ | 30,423 |  |  | $ | 29,016 |  |  | $ | 27,864 |  |  | $ | 26,990 |  |  |  |  |  |  | $ | 30,706 |  |

Annuity Account Balance Rollforward (a)

| Three Months Ended |  |  |  |  |  | Nine months ended |
| September 30, 2021 |  | June 30, 2021 |  | March 31, 2021 |  | December 31, 2020 |  | September 30, 2020 |  |  |  |  |  | September 30, 2021 |  |  |
Account balances at beginning of period: | $ | 24,774 |  |  | $ | 23,803 |  |  | $ | 22,992 |  |  | $ | 22,106 |  |  | $ | 21,442 |  |  |  |  |  |  | $ | 22,992 |  |  |  |
Net deposits | 1,311 |  |  | 1,390 |  |  | 1,265 |  |  | 1,305 |  |  | 1,046 |  |  |  |  |  |  | 3,966 |  |  |  |
Surrenders, withdrawals, deaths, etc. | (625) |  |  | (628) |  |  | (585) |  |  | (533) |  |  | (482) |  |  |  |  |  |  | (1,838) |  |  |  |
Net flows | 686 |  |  | 762 |  |  | 680 |  |  | 772 |  |  | 564 |  |  |  |  |  |  | 2,128 |  |  |  |
Premium and interest bonuses | 20 |  |  | 21 |  |  | 18 |  |  | 20 |  |  | 17 |  |  |  |  |  |  | 59 |  |  |  |
Fixed interest credited and index credits | 217 |  |  | 225 |  |  | 148 |  |  | 131 |  |  | 114 |  |  |  |  |  |  | 590 |  |  |  |
Guaranteed product rider fees | (35) |  |  | (37) |  |  | (35) |  |  | (37) |  |  | (31) |  |  |  |  |  |  | (107) |  |  |  |
Account balance at end of period | $ | 25,662 |  |  | $ | 24,774 |  |  | $ | 23,803 |  |  | $ | 22,992 |  |  | $ | 22,106 |  |  |  |  |  |  | $ | 25,662 |  |  |  |

(a) The rollforward reflects the vested account balance of our fixed index annuities and fixed rate annuities, net of reinsurance.
12

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Annuity Liability Characteristics

|  | Fixed Annuities Account Value |  | Fixed Index Annuities Account Value
|  | September 30, 2021
SURRENDER CHARGE PERCENTAGES: |  |  |  |
No surrender charge |  | $ | 341 |  |  | $ | 2,478 |
0.0% < 2.0% |  | 8 |  |  | 112 |
2.0% < 4.0% |  | 41 |  |  | 711 |
4.0% < 6.0% |  | 612 |  |  | 1,640 |
6.0% < 8.0% |  | 1,765 |  |  | 3,364 |
8.0% < 10.0% |  | 1,799 |  |  | 7,464 |
10.0% or greater |  | — |  |  | 5,326 |
|  | $ | 4,566 |  |  | $ | 21,095 |

|  | Fixed Annuities Account Value |  | Fixed Index Annuities Account Value |  |
|  | September 30, 2021 |  |
CREDITED RATE (INCLUDING BONUS INTEREST) VS. ULTIMATE MINIMUM GUARANTEED RATE DIFFERENTIAL: |  |  |  |  |  |
No differential |  | $ | 487 |  |  | $ | 1,376 |  |  |
0.0% - 1.0% |  | 650 |  |  | 1,253 |  |  |
1.0% - 2.0% |  | 1,528 |  |  | 8 |  |  |
2.0% - 3.0% |  | 1,901 |  |  | — |  |  |
Allocated to index strategies |  | — |  |  | 18,458 |  |  |
|  | $ | 4,566 |  |  | $ | 21,095 |  |  |

13

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Summary of Invested Assets by Asset Class

|  | September 30, 2021 |  |  | December 31, 2020
|  | Amortized Cost |  | Fair Value |  | Percent |  |  | Amortized Cost |  | Fair Value |  | Percent
Fixed maturity securities, available for sale: |  |  |  |  |  |  |  |  |  |  |  |  |
United States Government full faith and credit |  | $ | 479 |  |  | $ | 472 |  |  | 1 | % |  |  | $ | 45 |  |  | $ | 45 |  |  | — | %
United States Government sponsored entities |  | 83 |  |  | 85 |  |  | — | % |  |  | 105 |  |  | 106 |  |  | — | %
United States municipalities, states and territories |  | 1,241 |  |  | 1,301 |  |  | 4 | % |  |  | 1,243 |  |  | 1,309 |  |  | 4 | %
Foreign Governments |  | 132 |  |  | 137 |  |  | 1 | % |  |  | 128 |  |  | 140 |  |  | — | %
Corporate securities: |  |  |  |  |  |  |  |  |  |  |  |  |
Finance, insurance and real estate |  | 4,509 |  |  | 4,758 |  |  | 13 | % |  |  | 4,267 |  |  | 4,572 |  |  | 15 | %
Manufacturing, construction and mining |  | 856 |  |  | 920 |  |  | 3 | % |  |  | 839 |  |  | 936 |  |  | 3 | %
Utilities, energy and related sectors |  | 2,636 |  |  | 2,764 |  |  | 9 | % |  |  | 2,532 |  |  | 2,762 |  |  | 9 | %
Wholesale/retail trade |  | 2,226 |  |  | 2,345 |  |  | 6 | % |  |  | 1,900 |  |  | 2,106 |  |  | 7 | %
Services, media and other |  | 2,911 |  |  | 3,032 |  |  | 8 | % |  |  | 2,568 |  |  | 2,793 |  |  | 9 | %
Hybrid securities |  | 808 |  |  | 893 |  |  | 2 | % |  |  | 888 |  |  | 963 |  |  | 3 | %
Non-agency residential mortgage-backed securities |  | 621 |  |  | 646 |  |  | 2 | % |  |  | 677 |  |  | 694 |  |  | 2 | %
Commercial mortgage-backed securities |  | 2,602 |  |  | 3,006 |  |  | 8 | % |  |  | 2,468 |  |  | 2,806 |  |  | 9 | %
Asset-backed securities |  | 3,752 |  |  | 3,830 |  |  | 11 | % |  |  | 1,920 |  |  | 1,999 |  |  | 6 | %
CLO securities |  | 4,164 |  |  | 4,361 |  |  | 12 | % |  |  | 4,021 |  |  | 4,268 |  |  | 14 | %
Alternative investments: |  |  |  |  |  |  |  |  |  |  |  |  |
Private equity |  | 933 |  |  | 933 |  |  | 2 | % |  |  | 614 |  |  | 614 |  |  | 2 | %
Real assets |  | 318 |  |  | 321 |  |  | 1 | % |  |  | 280 |  |  | 288 |  |  | 1 | %
Credit |  | 768 |  |  | 768 |  |  | 2 | % |  |  | 254 |  |  | 254 |  |  | 1 | %
Equity securities |  | 950 |  |  | 1,026 |  |  | 2 | % |  |  | 959 |  |  | 1,047 |  |  | 3 | %
Commercial mortgage loans |  | 1,984 |  |  | 2,011 |  |  | 5 | % |  |  | 903 |  |  | 926 |  |  | 3 | %
Residential mortgage loans |  | 1,500 |  |  | 1,473 |  |  | 4 | % |  |  | 1,128 |  |  | 1,123 |  |  | 4 | %
Other (primarily derivatives and company owned life insurance) |  | 896 |  |  | 1,035 |  |  | 3 | % |  |  | 815 |  |  | 997 |  |  | 4 | %
Short term investments |  | 258 |  |  | 258 |  |  | 1 | % |  |  | 456 |  |  | 456 |  |  | 1 | %
Total (a) |  | $ | 34,627 |  |  | $ | 36,375 |  |  | 100 | % |  |  | $ | 29,010 |  |  | $ | 31,204 |  |  | 100 | %
(a) Asset duration of 6.2 years and 6.8 years vs. liability duration of 7.4 years and 6.7 years for the periods ending September 30, 2021 and December 31, 2020, respectively.

14

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Credit Quality of Fixed Maturity Securities

|  | September 30, 2021
NAIC Designation |  | Fair Value |  | Percent
1 |  | $ | 14,770 |  |  | 52 | %
2 |  | 10,899 |  |  | 38 | %
3 |  | 1,927 |  |  | 7 | %
4 |  | 747 |  |  | 2 | %
5 |  | 149 |  |  | 1 | %
6 |  | 58 |  |  | — | %
|  | $ | 28,550 |  |  | 100 | %

|  | September 30, 2021
Rating Agency Rating |  | Fair Value |  | Percent
AAA |  | $ | 982 |  |  | 3 | %
AA |  | 1,921 |  |  | 7 | %
A |  | 7,273 |  |  | 25 | %
BBB |  | 9,804 |  |  | 34 | %
Not rated |  | 5,869 |  |  | 21 | %
Total investment grade |  | 25,849 |  |  | 90 | %
BB |  | 1,621 |  |  | 6 | %
B and below |  | 565 |  |  | 2 | %
Not rated |  | 515 |  |  | 2 | %
Total below investment grade |  | 2,701 |  |  | 10 | %
|  | $ | 28,550 |  |  | 100 | %

15

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Summary of Residential Mortgage Backed Securities by Collateral Type and NAIC Designation

|  | September 30, 2021
Total by collateral type |  | Amortized Cost |  | Fair Value
Government agency |  | $ | 83 |  |  | $ | 85 |
Prime |  | 483 |  |  | 507 |
Subprime |  | 59 |  |  | 59 |
Alt-A |  | 79 |  |  | 80 |
|  | $ | 704 |  |  | $ | 731 |
|  | September 30, 2021
Total by NAIC designation |  | Amortized Cost |  | Fair Value
1 |  | $ | 673 |  |  | $ | 699 |
2 |  | 17 |  |  | 18 |
3 |  | 7 |  |  | 7 |
4 |  | 6 |  |  | 6 |
5 |  | 1 |  |  | 1 |
|  | $ | 704 |  |  | $ | 731 |

Top 5 Reinsurers

|  |  |  | September 30, 2021
|  |  |  | Financial Strength Rating
Parent Company/Principal Reinsurers |  | Reinsurance Recoverable (a) |  | AM Best |  | S&P |  | Fitch |  | Moody's
Wilton Re |  | $ | 1,287 |  |  | A+ |  | not rated |  | A+ |  | not rated
Kubera Insurance (SAC) Ltd |  | 789 |  |  | not rated |  | not rated |  | not rated |  | not rated
Aspida Life Re Ltd |  | 717 |  |  | A- |  | not rated |  | BBB |  | not rated
Security Life of Denver |  | 103 |  |  | not rated |  | A- |  | A- |  | Baa1
London Life Reinsurance Co. |  | 102 |  |  | A+ |  | not rated |  | not rated |  | not rated

(a) Reinsurance recoverables do not include unearned ceded premiums that would be recovered in the event of early termination of certain traditional life policies.
16

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)
Non-GAAP Financial Measures Definitions
The following represents the definitions of non-GAAP measures used by F&G, as an operating segment of FNF:

Adjusted Net Earnings
Adjusted net earnings is a non-GAAP economic measure we use to evaluate financial performance each period. Adjusted net earnings is calculated by adjusting net earnings (loss) from continuing operations to eliminate:
(i) Recognized (gains) and losses, net: the impact of net investment gains/losses, including changes in allowance for expected credit losses and other than temporary impairment ("OTTI") losses, recognized in operations; the impact of market volatility on the alternative asset portfolio; and the effect of changes in fair value of the reinsurance related embedded derivative;
(ii) Indexed product related derivatives: the impacts related to changes in the fair value, including both realized and unrealized gains and losses, of index product related derivatives and embedded derivatives, net of hedging cost;
(iii) Purchase price amortization: the impacts related to the amortization of certain intangibles (internally developed software, trademarks and value of distribution asset (VODA)) recognized as a result of acquisition activities;
(iv) Transaction costs: the impacts related to acquisition, integration and merger related items; and
(v) Other "non-recurring", "infrequent" or "unusual items": Management excludes certain items determined to be “non-recurring”, “infrequent” or “unusual” from adjusted net earnings when incurred if it is determined these expenses are not a reflection of the core business and when the nature of the item is such that it is not reasonably likely to recur within two years and/or there was not a similar item in the preceding two years.
Adjustments to Adjusted net earnings are net of the corresponding impact on amortization of intangibles, as appropriate. The income tax impact related to these adjustments is measured using an effective tax rate, as appropriate by tax jurisdiction. While these adjustments are an integral part of the overall performance of F&G, market conditions and/or the non-operating nature of these items can overshadow the underlying performance of the core business. Accordingly, management considers this to be a useful measure internally and to investors and analysts in analyzing the trends of our operations.
Adjusted Net Earnings from Continuing Operations Attributable to Common Shareholders
Adjusted Net Earnings from continuing operations attributable to common shareholders is a non-GAAP economic measure we use to evaluate financial performance attributable to our common shareholders each period. Adjusted net earnings from continuing operations attributable to common shareholders is calculated by adjusting net earnings (loss) available to common shareholders to eliminate the same items as described in the Adjusted Net Earnings paragraph above. While these adjustments are an integral part of the overall performance of the Company, market conditions and/or the non-operating nature of these items can overshadow the underlying performance of the core business. Accordingly, Management considers this to be a useful measure internally and to investors and analysts in analyzing the trends of our operations.
Total Shareholders’ Equity Excluding AOCI
Total Shareholders’ Equity Excluding AOCI is based on Total Shareholders' Equity excluding the effect of AOCI. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, Management considers this non-GAAP financial measure to provide useful supplemental information internally and to investors and analysts assessing the level of earned equity on Total Shareholders' equity.

17

F&G - An Operating Segment of FNF
Financial Supplement - September 30, 2021
(All periods are unaudited)

Non-GAAP Financial Measures Definitions (continued)
Average Assets Under Management (AAUM)
AAUM is calculated as the sum of:
(i) total invested assets at amortized cost, excluding derivatives;
(ii) related party loans and investments;
(iii) accrued investment income;
(iv) the net payable/receivable for the purchase/sale of investments, and
(v) cash and cash equivalents, excluding derivative collateral, at the beginning of the period and the end of each month in the period, divided by the total number of months in the period plus one.
Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the rate of return on assets available for reinvestment.
Yield on AAUM
Yield on AAUM is calculated by dividing annualized net investment income by AAUM. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the level of return earned on AAUM.
Alternative Investment Yield Adjustment
Alternative investment yield adjustment is the current period yield impact of market volatility on the alternative investment portfolio. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the level of return earned on AAUM.
Adjusted Yield on AAUM
Adjusted Yield on AAUM is calculated by dividing annualized net investment income by AAUM, plus or minus the alternative investment yield adjustment. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the level of return earned on AAUM.
Net Investment Spread
Net investment spread is the excess of net investment income, adjusted for market volatility on the alternative asset investment portfolio, earned over the sum of interest credited to policyholders and the cost of hedging our risk on indexed product policies. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the performance of the Company’s invested assets against the level of investment return provided to policyholders, inclusive of hedging costs.

18