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LIABILITIES FOR INSURANCE PRODUCTS

9 Months Ended

Sep. 30, 2025

The liability for future policy benefits is determined based on numerous assumptions. The most significant assumptions for our life and annuity business are based on our experience and, in cases of limited experience, industry experience. Mortality and lapse/withdrawal rates also take into consideration future expectations in policyholder behavior that may vary from past experience. For our health business, mortality rates, lapse rates, morbidity assumptions and future rate increases are based on our experience and, in cases of limited experience, industry experience. Such assumptions also consider future expectations in policyholder behavior that may vary from past experience.

In the third quarter of 2025 and 2024, we reviewed our actual experience and updated our assumptions for future cash flows. The impact of updating these assumptions is reflected in the "Effect of changes in cash flow assumptions" line items in the tables below.

The following tables summarize balances and changes in the liability for future policy benefits for traditional and limited-payment contracts for the nine months ended September 30, 2025 (dollars in millions):


	Supplemental health		Medicare supplement		Long-term care		Traditional life		Other annuities		Total
Present value of expected net premiums ("PVENP"), beginning of period	$	2,643.9	$	3,161.9	$	1,102.8	$	2,203.9	$	—	$	9,112.5
Effect of changes in discount rate assumptions, beginning of period	180.0		195.2		25.7		113.5		—		514.4
Beginning PVENP at original discount rate	2,823.9		3,357.1		1,128.5		2,317.4		—		9,626.9
Effect of changes in cash flow assumptions	(63.2)		182.7		31.0		2.3		—		152.8
Effect of actual variances from expected experience	(54.6)		44.2		(28.3)		(89.5)		—		(128.2)
Adjusted beginning of period PVENP	2,706.1		3,584.0		1,131.2		2,230.2		—		9,651.5
Issuances	230.3		354.3		135.4		297.2		5.1		1,022.3
Interest accrual	91.7		109.0		40.1		71.0		—		311.8
Net premiums collected	(264.7)		(345.7)		(124.7)		(298.2)		(5.1)		(1,038.4)
Ending PVENP at original discount rate	2,763.4		3,701.6		1,182.0		2,300.2		—		9,947.2
Effect of changes in discount rate assumptions, end of period	(96.8)		(104.8)		7.1		(40.9)		—		(235.4)
PVENP, end of period	$	2,666.6	$	3,596.8	$	1,189.1	$	2,259.3	$	—	$	9,711.8


Present value of expected future policy benefits ("PVEFPB"), beginning of period	$	5,828.2	$	3,375.6	$	4,240.1	$	4,570.6	$	264.5	$	18,279.0
Effect of changes in discount rate assumptions, beginning of period	516.6		211.5		94.1		333.3		16.2		1,171.7
Beginning PVEFPB at original discount rate	6,344.8		3,587.1		4,334.2		4,903.9		280.7		19,450.7
Effect of changes in cash flow assumptions	(87.2)		192.0		25.8		1.8		(2.8)		129.6
Effect of actual variances from expected experience	(61.8)		51.0		(42.6)		(111.7)		2.4		(162.7)
Adjusted beginning of period PVEFPB	6,195.8		3,830.1		4,317.4		4,794.0		280.3		19,417.6
Issuances	233.6		354.5		135.5		302.2		5.1		1,030.9
Interest accrual	218.6		116.6		171.4		158.0		9.6		674.2
Benefit payments	(319.0)		(379.6)		(219.3)		(348.6)		(22.1)		(1,288.6)
Ending PVEFPB at original discount rate	6,329.0		3,921.6		4,405.0		4,905.6		272.9		19,834.1
Effect of changes in discount rate assumptions, end of period	(317.0)		(113.6)		26.5		(180.0)		(9.0)		(593.1)
PVEFPB, end of period	$	6,012.0	$	3,808.0	$	4,431.5	$	4,725.6	$	263.9	$	19,241.0


Net liability for future policy benefits	$	3,345.4	$	211.2	$	3,242.4	$	2,466.3	$	263.9	$	9,529.2
Flooring impact	—		0.9		—		—		—		0.9
Adjusted net liability for future policy benefits	3,345.4		212.1		3,242.4		2,466.3		263.9		9,530.1
Related reinsurance recoverable	(1.7)		—		(386.5)		(162.3)		—		(550.5)
Net liability for future policy benefits, net of reinsurance recoverable	$	3,343.7	$	212.1	$	2,855.9	$	2,304.0	$	263.9	$	8,979.6


Adjusted net liability for future policy benefits	$	9,530.1
Reserves excluded from rollforward (a)	2,351.3
Deferred liability	69.2
Future loss reserves (b)	24.9
Future policy benefits	$	11,975.5

(a) Primarily comprised of blocks of business that are 100% ceded.

(b) In certain instances for interest-sensitive products, the total insurance liabilities for a particular line of business may not be deficient in the aggregate to trigger loss recognition, but the pattern of earnings may be such that profits are expected to be recognized in earlier years followed by losses in later years. In these situations, accounting standards require that an additional liability (the "future loss reserve") be recognized by an amount necessary to sufficiently offset the losses that would be recognized in later years.


	Supplemental health		Medicare supplement		Long-term care		Traditional life		Other annuities		Total
PVENP, beginning of period	$	2,718.2	$	3,009.1	$	1,055.6	$	2,279.6	$	—	$	9,062.5
Effect of changes in discount rate assumptions, beginning of period	86.8		99.2		(7.6)		67.6		—		246.0
Beginning PVENP at original discount rate	2,805.0		3,108.3		1,048.0		2,347.2		—		9,308.5
Effect of changes in cash flow assumptions	(28.4)		85.2		9.6		(20.1)		—		46.3
Effect of actual variances from expected experience	11.7		10.6		(8.9)		(55.3)		—		(41.9)
Adjusted beginning of period PVENP	2,788.3		3,204.1		1,048.7		2,271.8		—		9,312.9
Issuances	202.1		243.5		145.0		292.6		4.4		887.6
Interest accrual	92.7		98.5		39.6		73.4		—		304.2
Net premiums collected	(260.3)		(337.3)		(119.9)		(303.3)		(4.4)		(1,025.2)
Ending PVENP at original discount rate	2,822.8		3,208.8		1,113.4		2,334.5		—		9,479.5
Effect of changes in discount rate assumptions, end of period	(57.3)		(64.8)		17.1		(35.6)		—		(140.6)
PVENP, end of period	$	2,765.5	$	3,144.0	$	1,130.5	$	2,298.9	$	—	$	9,338.9


PVEFPB, beginning of period	$	6,023.3	$	3,236.6	$	4,364.6	$	4,694.7	$	308.9	$	18,628.1
Effect of changes in discount rate assumptions, beginning of period	229.8		108.3		(132.8)		170.9		3.0		379.2
Beginning PVEFPB at original discount rate	6,253.1		3,344.9		4,231.8		4,865.6		311.9		19,007.3
Effect of changes in cash flow assumptions	(39.2)		95.2		8.2		(20.7)		—		43.5
Effect of actual variances from expected experience	16.4		11.3		(23.2)		(65.7)		(16.5)		(77.7)
Adjusted beginning of period PVEFPB	6,230.3		3,451.4		4,216.8		4,779.2		295.4		18,973.1
Issuances	202.5		239.9		145.2		298.0		4.5		890.1
Interest accrual	218.4		106.3		171.0		159.4		10.3		665.4
Benefit payments	(329.1)		(360.2)		(222.0)		(336.7)		(23.9)		(1,271.9)
Ending PVEFPB at original discount rate	6,322.1		3,437.4		4,311.0		4,899.9		286.3		19,256.7
Effect of changes in discount rate assumptions, end of period	(172.8)		(71.5)		159.0		(113.7)		(1.3)		(200.3)
PVEFPB, end of period	$	6,149.3	$	3,365.9	$	4,470.0	$	4,786.2	$	285.0	$	19,056.4


Net liability for future policy benefits	$	3,383.8	$	221.9	$	3,339.5	$	2,487.3	$	285.0	$	9,717.5
Flooring impact	—		0.5		—		—		—		0.5
Adjusted net liability for future policy benefits	3,383.8		222.4		3,339.5		2,487.3		285.0		9,718.0
Related reinsurance recoverable	(1.5)		—		(384.6)		(178.7)		—		(564.8)
Net liability for future policy benefits, net of reinsurance recoverable	$	3,382.3	$	222.4	$	2,954.9	$	2,308.6	$	285.0	$	9,153.2


Adjusted net liability for future policy benefits	$	9,718.0
Reserves excluded from rollforward (a)	2,445.4
Deferred liability	67.4
Future loss reserves (b)	27.4
Future policy benefits	$	12,258.2

(a) Primarily comprised of blocks of business that are 100% ceded.

Many of our fixed indexed annuity products include a GLWB that is considered a MRB. The calculation of MRBs includes market assumptions (interest rate, equity returns, volatility and dividend yields) and nonmarket assumptions (mortality rates, surrender and withdrawal rates, GLWB utilization and spreads). Market assumptions are updated quarterly to reflect current market conditions.

In the third quarter of 2025 and 2024, we reviewed our nonmarket assumptions used to calculate the MRBs and determined updates were warranted. The impact of updating these assumptions is reflected in the “Effect of changes in future expected policyholder behavior” line items in the table below.

The following table presents the balance of and changes in MRBs associated with our fixed indexed annuities (dollars in millions):


	Nine months ended
	September 30,
	2025		2024
Net liability (asset), beginning of period	$	60.0	$	117.1
Effect of changes in the instrument-specific credit risk, beginning of period	1.4		4.8
Balance, beginning of period, before effect of changes in the instrument-specific credit risk	61.4		121.9
Issuances	3.4		3.2
Interest accrual	2.0		3.6


Effect of changes in interest rates	0.9		(13.6)
Effect of changes in equity markets	(0.3)		(0.4)
Effect of changes in equity index volatility	2.2		2.4
Actual policyholder behavior different from expected behavior	(0.6)		(0.9)
Effect of changes in future expected policyholder behavior - other	(13.3)		(36.3)
Effect of changes in future expected policyholder behavior - risk margin	0.1		0.2
Effect of changes in assumptions	(2.4)		(3.9)
Net liability (asset), end of period, before effect of changes in the instrument-specific credit risk	53.4		76.2
Effect of changes in the instrument-specific credit risk, end of period	(0.8)		(2.1)


Net liability (asset), end of period, net of reinsurance	$	52.6	$	74.1

Balance reported as an asset	$	—	$	—
Balance reported as a liability	52.6		74.1
Net liability (asset)	$	52.6	$	74.1

Net amount at risk	$	22.1	$	27.6
Weighted average attained age of contract holders	70		69

The following table summarizes the amount of revenue and interest related to traditional and limited-payment contracts recognized in the consolidated statement of operations (dollars in millions):


	Gross premiums (a)				Interest accretion (b)
	Nine months ended				Nine months ended
	September 30,				September 30,
	2025		2024		2025		2024
Other annuities	$	6.0	$	4.9	$	9.6	$	10.3
Supplemental health	554.0		542.3		126.9		125.7
Medicare supplement	465.4		461.6		7.6		7.8
Long-term care	264.8		255.0		131.3		131.4
Traditional life	551.6		544.0		87.0		86.0
Total	$	1,841.8	$	1,807.8	$	362.4	$	361.2

_____________________

(a) Such amounts are included in insurance policy income in the consolidated statement of operations.

(b) Such amounts are included in insurance policy benefits in the consolidated statement of operations.

The following table provides the amount of undiscounted and discounted expected future gross premiums and expected future benefits and expenses for traditional and limited-payment contracts (dollars in millions):


	September 30, 2025				September 30, 2024
	Undiscounted		Discounted (a)		Undiscounted		Discounted (a)
Other annuity
Expected future gross premiums	$	—	$	—	$	—	$	—
Expected future benefits and expenses	312.8		263.9		337.6		285.0
Supplemental health
Expected future gross premiums	9,098.7		5,687.4		8,980.6		5,726.1
Expected future benefits and expenses	10,781.4		6,012.0		10,901.9		6,149.3
Medicare supplement
Expected future gross premiums	6,930.0		4,753.6		5,968.3		4,244.2
Expected future benefits and expenses	5,565.5		3,808.0		4,758.4		3,365.9
Long-term care
Expected future gross premiums	3,648.8		2,564.4		3,462.8		2,486.9
Expected future benefits and expenses	8,100.0		4,431.5		7,881.2		4,470.0
Traditional life
Expected future gross premiums	5,804.4		4,231.0		5,654.8		4,162.6
Expected future benefits and expenses	7,680.7		4,725.6		7,631.0		4,786.2

_____________________

(a) Calculated at the discount rates at period end.

Loss expense as a result of net premium ratio capping was not material for the nine months ended September 30, 2025 and 2024.

The following table provides the weighted average durations (under locked-in rates) of the liability for future policy benefits in years:


	September 30, 2025	September 30, 2024
Other annuity	9.5	9.6
Supplemental health	10.7	11.1
Medicare supplement	5.5	6.2
Long-term care	10.7	10.7
Traditional life	10.1	10.3

The following table provides the weighted average interest rates for the liability for future policy benefits:


	September 30, 2025		September 30, 2024
Other annuities
Interest accretion rate	4.87	%	4.81	%
Current discount rate	5.32	%	4.99	%
Supplemental health
Interest accretion rate	4.96	%	4.98	%
Current discount rate	5.26	%	4.97	%
Medicare supplement
Interest accretion rate	4.33	%	4.30	%
Current discount rate	4.93	%	4.74	%
Long-term care
Interest accretion rate	5.64	%	5.67	%
Current discount rate	5.35	%	5.03	%
Traditional life
Interest accretion rate	4.80	%	4.77	%
Current discount rate	5.30	%	5.00	%

The following tables present the balances of and changes in the liability for policyholder account balances (dollars in millions):


	Nine months ended
	September 30, 2025
	Fixed indexed annuities		Fixed interest annuities		Other annuities		Interest-sensitive life (a)		Funding agreements		Other (b)		Total
Policyholder account values, beginning of period excluding contracts 100% ceded	$	10,766.3	$	1,646.6	$	107.4	$	1,321.8	$	3,021.2	$	359.1	$	17,222.4
Issuances (funds collected from new business)	1,265.4		142.2		—		32.8		350.0		—		1,790.4
Premiums received (premiums collected from inforce business)	17.9		1.9		22.8		164.0		—		198.9		405.5
Policy charges	(20.6)		(1.4)		—		(150.4)		—		—		(172.4)
Surrenders and withdrawals	(670.5)		(117.6)		(22.7)		(27.7)		(473.8)		(210.0)		(1,522.3)
Benefit payments	(219.8)		(74.9)		(4.3)		(18.8)		—		—		(317.8)
Interest credited	248.3		38.2		2.0		48.3		82.2		1.8		420.8
Other	46.1		0.1		(0.3)		(0.2)		—		—		45.7
Policyholder account values, end of period excluding contracts 100% ceded	11,433.1		1,635.1		104.9		1,369.8		2,979.6		349.8		17,872.3
Policyholder account values, end of period for contracts 100% ceded	115.1		503.8		30.3		93.3		—		9.9		752.4
Amount of reserves above (below) policyholder account values (c)	(352.9)		—		—		18.5		—		—		(334.4)
Balance, end of period	$	11,195.3	$	2,138.9	$	135.2	$	1,481.6	$	2,979.6	$	359.7	$	18,290.3

Balance, end of period, reinsurance ceded	(109.9)		(503.8)		(30.3)		(111.0)		—		(22.8)		(777.8)
Balance, end of period, net of reinsurance	$	11,085.4	$	1,635.1	$	104.9	$	1,370.6	$	2,979.6	$	336.9	$	17,512.5



Weighted average crediting rate (d)	2.2	%	3.1	%	2.7	%	5.2	%	4.2	%	0.8	%



Cash surrender value, net of reinsurance	$	10,688.5	$	1,586.6	$	104.9	$	1,122.7	$	—	$	336.9

_______________

(a) The amount of insurance policy benefit expense resulting from death claims that we would incur in excess of the policyholder account balance (net amount at risk) for interest-sensitive life contracts was $30.7 billion at the balance sheet date.

(b) Predominantly consists of retained asset accounts associated with our traditional life and supplemental health blocks.

(c) Such amount represents the difference between: (i) the total insurance liabilities for our fixed indexed products (including the host contract and the related embedded derivative); and (ii) the policyholder account balances for these products. The accounting requirement to bifurcate the embedded derivative and value it at the current estimated fair value results in this amount.

(d) Excludes any impact from the amount of reserves above (below) policyholder account balances.


	Nine months ended
	September 30, 2024
	Fixed indexed annuities		Fixed interest annuities		Other annuities		Interest-sensitive life (a)		Funding agreements		Other (b)		Total
Policyholder account values, beginning of period excluding contracts 100% ceded	$	9,999.2	$	1,636.4	$	113.1	$	1,255.2	$	1,411.0	$	381.0	$	14,795.9
Issuances (funds collected from new business)	1,132.6		155.9		—		30.7		1,149.4		—		2,468.6
Premiums received (premiums collected from inforce business)	1.3		2.5		24.4		158.3		—		206.9		393.4
Policy charges	(23.2)		(1.0)		—		(146.7)		—		—		(170.9)
Surrenders and withdrawals	(706.5)		(134.4)		(24.5)		(26.4)		(24.2)		(225.6)		(1,141.6)
Benefit payments	(219.5)		(81.0)		(4.4)		(17.4)		—		—		(322.3)
Interest credited	244.1		34.7		1.6		47.9		37.5		1.9		367.7
Other	40.0		(0.4)		(0.4)		(0.4)		—		—		38.8
Policyholder account values, end of period excluding contracts 100% ceded	10,468.0		1,612.7		109.8		1,301.2		2,573.7		364.2		16,429.6
Policyholder account values, end of period for contracts 100% ceded	126.8		547.7		26.2		99.9		—		10.3		810.9
Amount of reserves above (below) policyholder account values (c)	(272.7)		—		—		24.6		—		—		(248.1)
Policyholder account balance, end of period	$	10,322.1	$	2,160.4	$	136.0	$	1,425.7	$	2,573.7	$	374.5	$	16,992.4

Balance, end of period, reinsurance ceded	(126.8)		(547.7)		(26.2)		(118.0)		—		(23.7)		(842.4)
Balance, end of period, net of reinsurance	$	10,195.3	$	1,612.7	$	109.8	$	1,307.7	$	2,573.7	$	350.8	$	16,150.0



Weighted average crediting rate (d)	2.1	%	2.8	%	2.5	%	4.9	%	3.5	%	0.8	%



Cash surrender value, net of reinsurance	$	9,772.1	$	1,578.0	$	109.8	$	1,055.5	$	—	$	350.8

_________________

(b) Predominantly consists of retained asset accounts associated with our traditional life and supplemental health blocks.

(d) Excludes any impact from the amount of reserves above (below) policyholder account balances.

The following tables present the account values by range of guaranteed minimum crediting rates and the related range of difference, in basis points, between rates being credited to policyholders and the respective guaranteed minimums (dollars in millions):


	September 30, 2025
Range of guaranteed minimum crediting rates (a)	At guaranteed minimum		1-50 basis points above		51-150 basis points above		Greater than 150 basis points above		Total
Fixed interest annuities
0.00%-2.99%	$	85.7	$	182.7	$	331.0	$	74.0	$	673.4
3.00%-4.99%	1,187.9		96.7		91.3		11.5		1,387.4
5.00% and greater	78.1		—		—		—		78.1
Subtotal	1,351.7		279.4		422.3		85.5		2,138.9
Other annuities
0.00%-2.99%	23.7		21.1		—		—		44.8
3.00%-4.99%	57.0		—		—		—		57.0
5.00% and greater	33.4		—		—		—		33.4
Subtotal	114.1		21.1		—		—		135.2
Interest-sensitive life
0.00%-2.99%	17.6		—		0.5		756.0		774.1
3.00%-4.99%	361.1		111.0		194.4		2.1		668.6
5.00% and greater	20.2		0.2		—		—		20.4
Subtotal	398.9		111.2		194.9		758.1		1,463.1
Other
0.00%-2.99%	16.0		322.7		—		—		338.7
3.00%-4.99%	20.7		—		—		—		20.7
5.00% and greater	0.3		—		—		—		0.3
Subtotal	37.0		322.7		—		—		359.7
Total
0.00%-2.99%	143.0		526.5		331.5		830.0		1,831.0
3.00%-4.99%	1,626.7		207.7		285.7		13.6		2,133.7
5.00% and greater	132.0		0.2		—		—		132.2
Total policyholder account balances, excluding fixed indexed annuities	$	1,901.7	$	734.4	$	617.2	$	843.6	$	4,096.9
Fixed indexed annuity account balances									11,548.2
Funding agreements									2,979.6
Total policyholder account values									18,624.7
Amount of reserves above (below) policyholder account values									(334.4)
Total policyholder account balances									$	18,290.3

____________________

(a) Excludes the account balances related to: (i) fixed indexed annuity contracts that include an index fund component, with index credits tied to the performance of the index. The minimum guarantee is determined by a participation or cap rate

linked to an index, such as the Standard & Poor’s 500 index, rather than a predetermined rate of return; and (ii) funding agreements which have a fixed crediting rate.


	September 30, 2024
Range of guaranteed minimum crediting rates (a)	At guaranteed minimum		1-50 basis points above		51-150 basis points above		Greater than 150 basis points above		Total
Fixed interest annuities
0.00%-2.99%	$	96.0	$	203.5	$	232.8	$	81.0	$	613.3
3.00%-4.99%	1,286.9		49.4		108.4		20.9		1,465.6
5.00% and greater	81.5		—		—		—		81.5
Subtotal	1,464.4		252.9		341.2		101.9		2,160.4
Other annuities
0.00%-2.99%	33.9		23.5		—		—		57.4
3.00%-4.99%	45.4		—		—		—		45.4
5.00% and greater	33.2		—		—		—		33.2
Subtotal	112.5		23.5		—		—		136.0
Interest-sensitive life
0.00%-2.99%	14.3		—		0.5		701.8		716.6
3.00%-4.99%	438.1		49.0		175.0		1.0		663.1
5.00% and greater	20.9		0.5		—		—		21.4
Subtotal	473.3		49.5		175.5		702.8		1,401.1
Other
0.00%-2.99%	16.8		334.9		—		—		351.7
3.00%-4.99%	22.6		—		—		—		22.6
5.00% and greater	0.2		—		—		—		0.2
Subtotal	39.6		334.9		—		—		374.5
Total
0.00%-2.99%	161.0		561.9		233.3		782.8		1,739.0
3.00%-4.99%	1,793.0		98.4		283.4		21.9		2,196.7
5.00% and greater	135.8		0.5		—		—		136.3
Total policyholder account balances, excluding fixed indexed annuities	$	2,089.8	$	660.8	$	516.7	$	804.7	$	4,072.0
Fixed indexed annuity account balances									10,594.8
Funding agreements									2,573.7
Total policyholder account values									17,240.5
Amount of reserves above (below) policyholder account values									(248.1)
Total policyholder account balances									$	16,992.4

____________________

linked to an index, such as the Standard & Poor’s 500 index, rather than a predetermined rate of return; and (ii) funding agreements which have a fixed crediting rate.