EX-99.2 3 tm2419666d1_ex99-2.htm EXHIBIT 99.2

Exhibit 99.2

AMERICAN NATIONAL GROUP, LLC

Condensed Consolidated Financial Statements

March 31, 2024

AMERICAN NATIONAL GROUP, LLC

TABLE OF CONTENTS

FINANCIAL STATEMENTS: |
Condensed Consolidated Statements of Financial Position as of March 31, 2024 and December 31, 2023 (unaudited) | 1
Condensed Consolidated Statements of Operations for the periods ended March 31, 2024 and 2023 (unaudited) | 2
Condensed Consolidated Statements of Comprehensive Income for the periods ended March 31, 2024 and 2023 (Loss) (unaudited) | 3
Condensed Consolidated Statements of Changes in Equity for the periods ended March 31, 2024 and 2023 (unaudited) | 4
Condensed Consolidated Statements of Cash Flows for the periods ended March 31, 2024 and 2023 (unaudited) | 5
Notes to the Condensed Consolidated Financial Statements (unaudited) | 7
Note 1 – Nature of Operations | 7
Note 2 – Summary of Significant Accounting Policies and Practices | 7
Note 3 – Recently Issued Accounting Pronouncements | 8
Note 4 – Investment in Securities | 9
Note 5 – Mortgage Loans | 14
Note 6 – Real Estate and Other Investments | 18
Note 7 – Derivative Instruments | 21
Note 8 – Net Investment Income and Realized Investment Gains (Losses) | 23
Note 9 – Fair Value of Financial Instruments | 24
Note 10 – Deferred Policy Acquisition Costs and Value of Business Acquired | 35
Note 11 – Liability for Unpaid Claims and Claim Adjustment Expenses | 36
Note 12 – Federal Income Taxes | 37
Note 13 – Accumulated Other Comprehensive Income (Loss) | 38
Note 14 – Equity and Noncontrolling Interests | 39
Note 15 – Debt | 40
Note 16 – Commitments and Contingencies | 40
Note 17 – Related Party Transactions | 42
Note 18 – Liability for Future Policy Benefits | 43
Note 19 – Policyholders' Account Balances | 45
Note 20 – Market Risk Benefits | 49
Note 21 – Segment Information | 50
Note 22 – Subsequent Events | 51

AMERICAN NATIONAL GROUP, LLC

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)

(In thousands)

|  | March 31, 2024 |  |  | December 31, 2023 |
ASSETS |  |  |  |  |  |  |  |
Fixed maturity, bonds available-for-sale, at fair value (Allowance for credit losses of $27,256 in 2024 and $24,218 in 2023) (Amortized cost $14,638,506 in 2024 and $13,475,451 in 2023) |  | $ | 14,197,880 |  |  | $ | 13,070,576 |
Equity securities, at fair value (Cost $1,413,094 in 2024 and $1,336,218 in 2023) |  |  | 1,426,370 |  |  |  | 1,404,247 |
Mortgage loans on real estate, net of allowance for credit losses of $53,845 in 2024 and $53,407 in 2023 |  |  | 5,581,631 |  |  |  | 5,658,023 |
Policy loans |  |  | 395,053 |  |  |  | 390,393 |
Real estate and real estate partnerships, net of accumulated depreciation of $281,447 in 2024 and $320,088 in 2023 |  |  | 3,554,363 |  |  |  | 3,610,853 |
Investment funds |  |  | 1,768,959 |  |  |  | 1,591,768 |
Short-term investments |  |  | 3,242,526 |  |  |  | 2,396,504 |
Other invested assets |  |  | 161,241 |  |  |  | 120,818 |
Total investments |  |  | 30,328,023 |  |  |  | 28,243,182 |
Cash and cash equivalents |  |  | 2,244,390 |  |  |  | 3,192,369 |
Accrued investment income |  |  | 238,982 |  |  |  | 196,163 |
Reinsurance recoverables |  |  | 422,420 |  |  |  | 426,911 |
Prepaid reinsurance premiums |  |  | 212,640 |  |  |  | 44,666 |
Premiums due and other receivables |  |  | 491,446 |  |  |  | 483,834 |
Deferred policy acquisition costs |  |  | 971,535 |  |  |  | 944,469 |
Market risk benefit |  |  | 24,725 |  |  |  | 33,658 |
Property and equipment, net of accumulated depreciation of $335,569 in 2024 and $332,951 in 2023 |  |  | 170,498 |  |  |  | 167,946 |
Deferred tax asset |  |  | 252,051 |  |  |  | 291,340 |
Current tax receivable |  |  | 100,867 |  |  |  | 97,439 |
Prepaid pension |  |  | 254,200 |  |  |  | 247,624 |
Other assets |  |  | 221,021 |  |  |  | 205,359 |
Goodwill |  |  | 121,097 |  |  |  | 121,097 |
Separate account assets |  |  | 1,284,939 |  |  |  | 1,188,989 |
Total assets |  | $ | 37,338,834 |  |  | $ | 35,885,046 |
LIABILITIES |  |  |  |  |  |  |  |
Future policy benefits |  |  |  |  |  |  |  |
Life |  | $ | 3,805,530 |  |  | $ | 3,675,387 |
Annuity |  |  | 2,841,733 |  |  |  | 2,373,100 |
Health |  |  | 36,909 |  |  |  | 59,472 |
Policyholders’ account balances |  |  | 17,588,446 |  |  |  | 17,177,476 |
Policy and contract claims |  |  | 1,853,571 |  |  |  | 1,869,970 |
Market risk benefits, at estimated fair value |  |  | 55,366 |  |  |  | 33,572 |
Unearned premium reserve |  |  | 1,147,002 |  |  |  | 1,138,937 |
Other policyholder funds |  |  | 339,284 |  |  |  | 334,892 |
Liability for retirement benefits |  |  | 17,767 |  |  |  | 26,395 |
Long-term debt |  |  | 1,493,636 |  |  |  | 1,493,326 |
Notes payable |  |  | 184,601 |  |  |  | 174,017 |
Other liabilities |  |  | 623,345 |  |  |  | 440,709 |
Separate account liabilities |  |  | 1,284,939 |  |  |  | 1,188,989 |
Total liabilities |  |  | 31,272,129 |  |  |  | 29,986,242 |
EQUITY |  |  |  |  |  |  |  |
American National’s equity: |  |  |  |  |  |  |  |
Additional paid-in capital |  |  | 5,184,682 |  |  |  | 5,184,682 |
Accumulated other comprehensive loss |  |  | (59,234 | ) |  |  | (109,196 | )
Retained earnings |  |  | 829,204 |  |  |  | 715,836 |
Total American National’s equity |  |  | 5,954,652 |  |  |  | 5,791,322 |
Noncontrolling interest |  |  | 112,053 |  |  |  | 107,482 |
Total equity |  |  | 6,066,705 |  |  |  | 5,898,804 |
Total liabilities and equity |  | $ | 37,338,834 |  |  | $ | 35,885,046 |

See accompanying notes to the unaudited condensed consolidated financial statement s.

1

AMERICAN NATIONAL GROUP, LLC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(In thousands, except per share data)

|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
PREMIUMS AND OTHER REVENUES |  |  |  |  |  |  |  |
Premiums |  |  |  |  |  |  |  |
Life |  | $ | 102,433 |  |  | $ | 109,998 |
Annuity |  |  | 564,231 |  |  |  | 159,656 |
Health |  |  | 5,330 |  |  |  | 29,019 |
Property and Casualty |  |  | 471,742 |  |  |  | 481,718 |
Other policy revenues |  |  | 112,411 |  |  |  | 96,579 |
Net investment income |  |  | 470,219 |  |  |  | 341,102 |
Net realized investment gain (loss) |  |  | 2,295 |  |  |  | (22,367 | )
(Increase) decrease in investment credit loss |  |  | 1,309 |  |  |  | (11,466 | )
Net gains (losses) on equity securities |  |  | (10,811 | ) |  |  | (28,296 | )
Other income |  |  | 7,630 |  |  |  | 11,127 |
Total premiums and other revenues |  |  | 1,726,789 |  |  |  | 1,167,070 |
BENEFITS, LOSSES AND EXPENSES |  |  |  |  |  |  |  |
Policyholder benefits & claims |  |  | 1,083,699 |  |  |  | 651,436 |
Change in fair value of market risk benefit |  |  | 19,052 |  |  |  | 14,318 |
Interest credited to policyholders’ account balances |  |  | 192,224 |  |  |  | 139,597 |
Future policy benefit remeasurement losses |  |  | 1,678 |  |  |  | 39,212 |
Other operating expenses |  |  | 128,453 |  |  |  | 177,755 |
Amortization of deferred policy acquisition costs |  |  | 160,758 |  |  |  | 131,757 |
Total benefits, losses and expenses |  |  | 1,585,864 |  |  |  | 1,154,075 |
Income before federal income tax and other items |  |  | 140,925 |  |  |  | 12,995 |
Less: Provision (benefit) for federal income taxes |  |  |  |  |  |  |  |
Current |  |  | 2,343 |  |  |  | 5,938 |
Deferred |  |  | 26,442 |  |  |  | (8,185 | )
Total provision (benefit) for federal income taxes |  |  | 28,785 |  |  |  | (2,247 | )
Income after federal income tax |  |  | 112,140 |  |  |  | 15,242 |
Other components of net periodic pension benefit (costs), net of tax |  |  | 2,613 |  |  |  | (1,591 | )
Net income |  |  | 114,753 |  |  |  | 13,651 |
Less: Net income attributable to noncontrolling interest, net of tax |  |  | 1,385 |  |  |  | 4,758 |
Net income attributable to American National |  | $ | 113,368 |  |  | $ | 8,893 |

See accompanying notes to the unaudited condensed consolidated financial statements.

2

AMERICAN NATIONAL GROUP, LLC

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)

(In thousands)

|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
Net income |  | $ | 114,753 |  |  | $ | 13,651 |
Other comprehensive income (loss), net of tax |  |  |  |  |  |  |  |
Change in net unrealized losses on securities |  |  | (43,979 | ) |  |  | 339,630 |
Change in discount rate for liability for future policyholders’ benefit |  |  | 102,308 |  |  |  | (105,675 | )
Change in instrument specific credit risk for market risk benefit |  |  | (9,223 | ) |  |  | (6,790 | )
Foreign currency transaction and translation adjustments |  |  | (2,294 | ) |  |  | 136 |
Defined benefit pension plan adjustment |  |  | 3,150 |  |  |  | 1,446 |
Total other comprehensive income (loss), net of tax |  |  | 49,962 |  |  |  | 228,747 |
Total comprehensive income (loss) |  |  | 164,715 |  |  |  | 242,398 |
Less: Comprehensive income attributable to noncontrolling interest |  |  | 1,385 |  |  |  | 4,758 |
Total comprehensive income (loss) attributable to American National |  | $ | 163,330 |  |  | $ | 237,640 |

See accompanying notes to the unaudited condensed consolidated financial statements.

3

AMERICAN NATIONAL GROUP, LLC

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)

(In thousands)

|  | Additional Paid-in Capital |  |  | Accumulated Other Comprehensive Income (Loss) |  |  | Retained Earnings |  |  | Noncontrolling Interest |  |  | Total Member's Equity |
Balance as of January 1, 2024 |  | $ | 5,184,682 |  |  | $ | (109,196 | ) |  | $ | 715,836 |  |  | $ | 107,482 |  |  | $ | 5,898,804 |
Other comprehensive income |  |  | — |  |  |  | 49,962 |  |  |  | — |  |  |  | — |  |  |  | 49,962 |
Net income attributable to American National |  |  | — |  |  |  | — |  |  |  | 113,368 |  |  |  | — |  |  |  | 113,368 |
Contributions/Distributions |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 3,186 |  |  |  | 3,186 |
Net income attributable to noncontrolling interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,385 |  |  |  | 1,385 |
Balance at March 31, 2024 |  | $ | 5,184,682 |  |  | $ | (59,234 | ) |  | $ | 829,204 |  |  | $ | 112,053 |  |  | $ | 6,066,705 |

|  | Additional Paid-in Capital |  |  | Accumulated Other Comprehensive Income (Loss) |  |  | Retained Earnings |  |  | Noncontrolling Interest |  |  | Total Member's Equity |
Balance as of January 1, 2023 |  | $ | 3,805,072 |  |  | $ | (447,707 | ) |  | $ | 323,820 |  |  | $ | 74,268 |  |  | $ | 3,755,453 |
Other comprehensive income |  |  | — |  |  |  | 228,747 |  |  |  | — |  |  |  | — |  |  |  | 228,747 |
Net income attributable to American National |  |  | — |  |  |  | — |  |  |  | 8,893 |  |  |  | — |  |  |  | 8,893 |
Contributions/Distributions |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (4,177 | ) |  |  | (4,177 | )
Net income attributable to noncontrolling interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 4,758 |  |  |  | 4,758 |
Balance at Balance at March 31, 2023 |  | $ | 3,805,072 |  |  | $ | (218,960 | ) |  | $ | 332,713 |  |  | $ | 74,849 |  |  | $ | 3,993,674 |

See accompanying notes to the unaudited condensed consolidated financial statements.

4

AMERICAN NATIONAL GROUP, LLC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(In thousands)

|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
OPERATING ACTIVITIES |  |  |  |  |  |  |  |
Net income |  | $ | 114,753 |  |  | $ | 13,651 |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |  |  |  |
Net realized investment (gains) losses |  |  | (2,295 | ) |  |  | 22,367 |
Unrealized (gains) loss on investments and derivatives |  |  | (20,412 | ) |  |  | 3,415 |
Realized (gains) losses on Investments and derivatives |  |  | (25,377 | ) |  |  | 20,835 |
Income tax expense |  |  | 2,343 |  |  |  | 5,938 |
Increase (decrease) in investment credit loss |  |  | (1,309 | ) |  |  | 11,466 |
Accretion of premiums, discounts and loan origination fees |  |  | (164,332 | ) |  |  | (20,044 | )
Net capitalized interest on policy loans and mortgage loans |  |  | (2,480 | ) |  |  | (18,259 | )
Depreciation |  |  | 12,493 |  |  |  | 11,383 |
Interest credited to policyholders’ account balances |  |  | 192,224 |  |  |  | 139,597 |
Charges to policyholders’ account balances |  |  | (112,411 | ) |  |  | (96,579 | )
Deferred federal income tax expense (benefit) |  |  | 26,442 |  |  |  | (8,185 | )
Distributions from unconsolidated affiliates |  |  | 60,155 |  |  |  | 36,416 |
Income from equity method investments |  |  | (43,161 | ) |  |  | (28,296 | )
Changes in: |  |  |  |  |  |  |  |
Policyholder liabilities |  |  | 238,261 |  |  |  | 177,212 |
Market risk benefit |  |  | 19,052 |  |  |  | 4,959 |
Deferred policy acquisition costs |  |  | (27,265 | ) |  |  | (47,938 | )
Reinsurance payables |  |  | 4,491 |  |  |  | 20,875 |
Premiums due and other receivables |  |  | (7,612 | ) |  |  | (40,000 | )
Prepaid reinsurance premiums |  |  | (167,973 | ) |  |  | 4,324 |
Accrued investment income |  |  | (42,819 | ) |  |  | (8,629 | )
Liability for retirement benefits |  |  | (11,217 | ) |  |  | (5,988 | )
Other, net |  |  | 220,272 |  |  |  | (6,887 | )
Net cash provided by (used in) operating activities |  |  | 261,823 |  |  |  | 191,633 |
INVESTING ACTIVITIES |  |  |  |  |  |  |  |
Proceeds from sale/maturity/prepayment of: |  |  |  |  |  |  |  |
Fixed maturities |  |  | 596,813 |  |  |  | 3,727,996 |
Equity securities |  |  | 2,247 |  |  |  | 22,912 |
Real estate and real estate partnerships |  |  | 77,047 |  |  |  | — |
Mortgage loans |  |  | 112,648 |  |  |  | 96,682 |
Other invested assets |  |  | 3,821 |  |  |  | 6,856 |
Distributions from equity method investments |  |  | 51,743 |  |  |  | 18,823 |
Payment for the purchase/origination of: |  |  |  |  |  |  |  |
Fixed maturities |  |  | (1,181,080 | ) |  |  | (3,525,343 | )
Equity securities |  |  | (28,435 | ) |  |  | (55,205 | )
Real estate and real estate partnerships |  |  | (16,235 | ) |  |  | (122,498 | )
Mortgage loans |  |  | (70,786 | ) |  |  | (245,929 | )
Other invested assets |  |  | (40,864 | ) |  |  | (8,542 | )

5

AMERICAN NATIONAL GROUP, LLC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(In thousands)

|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
Additions to property and equipment |  |  | (16,037 | ) |  |  | (540 | )
Contributions to equity accounted investments |  |  | (216,619 | ) |  |  | (25,728 | )
Change in short-term investments |  |  | (817,360 | ) |  |  | 13,878 |
Change in collateral held for derivatives |  |  | 52,793 |  |  |  | 35,755 |
Other, net |  |  | (47,497 | ) |  |  | (3,395 | )
Net cash used in investing activities |  |  | (1,537,801 | ) |  |  | (64,278 | )
FINANCING ACTIVITIES |  |  |  |  |  |  |  |
Policyholders’ account deposits |  |  | 991,860 |  |  |  | 724,830 |
Policyholders’ account withdrawals |  |  | (661,677 | ) |  |  | (542,971 | )
Repayment of borrowings to related parties |  |  | (5,371 | ) |  |  | — |
Payments to noncontrolling interest |  |  | 3,187 |  |  |  | 4,884 |
Net cash provided by (used in) financing activities |  |  | 327,999 |  |  |  | 186,743 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS |  |  | (947,979 | ) |  |  | 314,098 |
Cash and cash equivalents at beginning of the period |  |  | 3,192,369 |  |  |  | 1,388,943 |
Cash and cash equivalents at end of the period |  |  | 2,244,390 |  |  |  | 1,703,041 |
Supplementary cash flow disclosure |  |  |  |  |  |  |  |
Income taxes paid (received) |  | $ | 5,035 |  |  | $ | (1,200 | )
Non-cash transactions |  |  |  |  |  |  |  |
Premium in-kind consideration received |  | $ | 462,382 |  |  | $ | — |

See accompanying notes to the unaudited condensed consolidated financial statements.

6

Note 1 - Nature of Operations

American National Group, LLC ("ANAT", "American National", or the "Company"), through its consolidated subsidiaries (collectively “American National”) offers a broad portfolio of insurance products, including individual and group life insurance, annuities, pension risk transfer, and property and casualty insurance. Business is conducted in all 50 states, the District of Columbia and Puerto Rico.

Note 2 - Summary of Significant Accounting Policies and Practices

The condensed consolidated financial statements and notes thereto have been prepared in conformity with Generally Accepted Accounting Principles ("GAAP") and are reported in U.S. currency. American National consolidates entities that are wholly-owned and those in which American National owns less than 100% but controls the voting rights, as well as variable interest entities in which American National is the primary beneficiary. Intercompany balances and transactions with consolidated entities have been eliminated. Investments in unconsolidated entities, which include real estate partnerships and investment funds, are accounted for using the equity method of accounting. Certain amounts in prior years have been reclassified to conform to current year presentation.

The accompanying interim condensed consolidated financial statements are unaudited and reflect all adjustments (including normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented in conformity with GAAP. The condensed consolidated results of operations for the interim periods should not be considered indicative of results to be expected for the full year.

The preparation of the condensed consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the reported condensed consolidated financial statement balances. The accompanying interim condensed consolidated financial statements are unaudited and reflect all adjustments (including normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented in conformity with GAAP. Actual results could differ from those estimates.

7

Note 3 - Recently Issued Accounting Pronouncement

Adopted Accounting Standards

Standard | Description | Effective Date and Method of Adoption | Impact on Financial Statements
ASU 2023-02, Investments—Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method | The amendments in this Update permit reporting entities to elect to account for their tax equity investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met. The amendments in this Update also require specific disclosures that must be applied to all investments that generate income tax credits and other income tax benefits from a tax credit program for which the entity has elected to apply the proportional amortization method. | The amendments in this update are effective for the Company for annual and interim reporting periods beginning January 1, 2024. | The adoption of this standard did not have a material impact to the Company's Condensed Consolidated Financial Statements or the Notes to the Condensed Consolidated Financial Statements.

Future Adoption of Accounting Standards

ASUs not listed below were assessed and either determined to be not applicable or are not expected to have a material impact on the Company’s interim condensed consolidated financial statements or disclosures.

Standard | Description | Effective Date and Method of Adoption | Impact on Financial Statements
ASU 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures | The amendments require the disclosure of significant segment expenses by reportable segment, enhance interim disclosure requirements and clarify circumstances in which an entity can disclose multiple segment measures of profit or loss. | Effective for annual periods beginning January 1, 2024 and interim periods beginning January 1, 2025, to be applied on a retrospective basis unless it is impracticable. | The impact of this amendment to the Company's Condensed Consolidated Financial Statements and Notes to the Condensed Consolidated Financial Statements is currently under evaluation.
ASU 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures | The amendments in this Update require that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold. In addition, the amendments in this update require that all entities disclose on an annual basis the following information about income taxes paid: (i) the amount of income taxes paid (net of refunds received) disaggregated by federal (national), state, and foreign taxes; and (ii) the amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than five percent of total income taxes paid (net of refunds received). | The amendments in this update are effective for the Company for annual reporting periods beginning January 1, 2025. | The impact of this amendment to the Company's Condensed Consolidated Financial Statements and Notes to the Condensed Consolidated Financial Statements is currently under evaluation.

8

Note 4 – Investment in Securities

The cost or amortized cost and fair value of investments in securities are shown below (in thousands):

|  | March 31, 2024 |
|  | Cost or Amortized Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized Losses |  |  | Allowance for Credit Losses |  |  | Fair Value |
Fixed maturity, bonds available-for-sale |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. treasury and government |  | $ | 66,780 |  |  | $ | 6 |  |  | $ | (1,928 | ) |  | $ | — |  |  | $ | 64,858 |
U.S. states and political subdivisions |  |  | 571,966 |  |  |  | 170 |  |  |  | (21,068 | ) |  |  | (91 | ) |  |  | 550,977 |
Foreign governments |  |  | 9,426 |  |  |  | — |  |  |  | (416 | ) |  |  | — |  |  |  | 9,010 |
Corporate debt securities |  |  | 12,498,201 |  |  |  | 100,554 |  |  |  | (490,156 | ) |  |  | (24,230 | ) |  |  | 12,084,369 |
Collateralized debt securities |  |  | 1,362,916 |  |  |  | 13,839 |  |  |  | (11,724 | ) |  |  | (2,495 | ) |  |  | 1,362,536 |
Residential mortgage-backed securities |  |  | 129,217 |  |  |  | 916 |  |  |  | (3,563 | ) |  |  | (440 | ) |  |  | 126,130 |
Total bonds available-for-sale |  |  | 14,638,506 |  |  |  | 115,485 |  |  |  | (528,855 | ) |  |  | (27,256 | ) |  |  | 14,197,880 |
Total investments in fixed maturity |  | $ | 14,638,506 |  |  | $ | 115,485 |  |  | $ | (528,855 | ) |  | $ | (27,256 | ) |  | $ | 14,197,880 |

|  | December 31, 2023 |
|  | Cost or Amortized Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized Losses |  |  | Allowance for Credit Losses |  |  | Fair Value |
Fixed maturity, bonds available-for-sale |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. treasury and government |  | $ | 63,466 |  |  | $ | 116 |  |  | $ | (1,354 | ) |  | $ | — |  |  | $ | 62,228 |
U.S. states and political subdivisions |  |  | 593,590 |  |  |  | 685 |  |  |  | (16,780 | ) |  |  | (181 | ) |  |  | 577,314 |
Foreign governments |  |  | 9,403 |  |  |  | — |  |  |  | (276 | ) |  |  | (24 | ) |  |  | 9,103 |
Corporate debt securities |  |  | 11,337,579 |  |  |  | 79,019 |  |  |  | (419,875 | ) |  |  | (18,951 | ) |  |  | 10,977,772 |
Collateralized debt securities |  |  | 1,340,141 |  |  |  | 8,724 |  |  |  | (27,243 | ) |  |  | (4,367 | ) |  |  | 1,317,255 |
Residential mortgage-backed securities |  |  | 131,272 |  |  |  | 351 |  |  |  | (4,024 | ) |  |  | (695 | ) |  |  | 126,904 |
Total bonds available-for-sale |  |  | 13,475,451 |  |  |  | 88,895 |  |  |  | (469,552 | ) |  |  | (24,218 | ) |  |  | 13,070,576 |
Total investments in fixed maturity |  | $ | 13,475,451 |  |  | $ | 88,895 |  |  | $ | (469,552 | ) |  | $ | (24,218 | ) |  | $ | 13,070,576 |

9

Note 4 – Investment in Securities – (Continued)

The amortized cost and fair value, by contractual maturity, of fixed maturity securities are shown below (in thousands):

|  | March 31, 2024 |
|  | Bonds Available-for-Sale |
|  | Amortized Cost |  |  | Fair Value |
Due in one year or less |  | $ | 729,069 |  |  | $ | 725,523 |
Due after one year through five years |  |  | 5,680,845 |  |  |  | 5,590,077 |
Due after five years through ten years |  |  | 4,020,165 |  |  |  | 3,878,380 |
Due after ten years |  |  | 4,208,427 |  |  |  | 4,003,900 |
Total |  | $ | 14,638,506 |  |  | $ | 14,197,880 |

Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Residential and commercial mortgage-backed securities, which are not due at a single maturity, have been presented based on the year of final contractual maturity.

Proceeds from sales of bonds available-for-sale, with the related gross realized gains and losses, are shown below (in thousands):

|  | Three months ended March 31, 2024 |  |  | Three Months Ended March 31, 2023 |
Proceeds from sales of fixed maturity, bonds available-for-sale |  | $ | 490,663 |  |  | $ | 970,333 |
Gross realized gains |  |  | 2,035 |  |  |  | 608 |
Gross realized losses |  |  | 2,407 |  |  |  | 25,145 |

Gains and losses are determined using specific identification of the securities sold. All held-to-maturity securities were transferred to available-for-sale through a management election allowed under business combination guidance.

In accordance with various regulations, American National has bonds on deposit with regulating authorities with a carrying value of $53.3 million and $53.5 million at March 31, 2024 and December 31, 2023, respectively. In addition, American National has pledged bonds in connection with certain agreements and transactions, such as financing and reinsurance agreements. The carrying value of bonds pledged was $37.5 million and $39.2 million at March 31, 2024 and December 31, 2023, respectively.

The components of the change in net unrealized gains (losses) on debt securities are shown below, on a pre-tax basis (in thousands):

|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
Bonds available-for-sale: change in unrealized losses |  | $ | (54,230 | ) |  | $ | 408,047 |
Short-term change in unrealized gains (losses) |  |  | (1,434 | ) |  |  | — |
Adjustments for |  |  |  |  |  |  |  |
Participating policyholders’ interest |  |  | — |  |  |  | — |
Change in net unrealized gains (losses) on debt securities |  | $ | (55,664 | ) |  | $ | 408,047 |

10

Note 4 – Investment in Securities – (Continued)

The components of the change in net gains (losses) on equity securities are shown below (in thousands):

|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
Unrealized gains (losses) on equity securities |  | $ | (10,777 | ) |  | $ | (28,599 | )
Net gains (losses) on equity securities sold |  |  | (34 | ) |  |  | 303 |
Net gains (losses) on equity securities |  | $ | (10,811 | ) |  | $ | (28,296 | )

The gross unrealized losses and fair value of bonds available-for-sale, aggregated by investment category and length of time individual securities have been in a continuous unrealized loss position due to market factors are shown below (in thousands, except number of issues):

|  | March 31, 2024 |
|  | Less than 12 months |  |  | 12 months or more |  |  | Total |
|  | Number of Issues |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Number of Issues |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Number of Issues |  |  | Gross Unrealized Losses |  |  | Fair Value |
Fixed maturity, bonds available-for-sale |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. treasury and government |  |  | 24 |  |  | $ | (110 | ) |  | $ | 13,481 |  |  |  | 38 |  |  | $ | (1,818 | ) |  | $ | 47,589 |  |  |  | 62 |  |  | $ | (1,928 | ) |  | $ | 61,070 |
U.S. states and political subdivisions |  |  | 166 |  |  |  | (6,208 | ) |  |  | 204,434 |  |  |  | 180 |  |  |  | (14,860 | ) |  |  | 316,691 |  |  |  | 346 |  |  |  | (21,068 | ) |  |  | 521,125 |
Foreign governments |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 2 |  |  |  | (416 | ) |  |  | 9,010 |  |  |  | 2 |  |  |  | (416 | ) |  |  | 9,010 |
Corporate debt securities |  |  | 1,196 |  |  |  | (99,346 | ) |  |  | 1,926,760 |  |  |  | 1,957 |  |  |  | (390,810 | ) |  |  | 6,829,027 |  |  |  | 3,153 |  |  |  | (490,156 | ) |  |  | 8,755,787 |
Collateralized debt securities |  |  | 39 |  |  |  | (2,531 | ) |  |  | 100,257 |  |  |  | 158 |  |  |  | (9,193 | ) |  |  | 634,336 |  |  |  | 197 |  |  |  | (11,724 | ) |  |  | 734,593 |
Residential mortgage-backed securities |  |  | 10 |  |  |  | (82 | ) |  |  | 11,145 |  |  |  | 43 |  |  |  | (3,481 | ) |  |  | 76,707 |  |  |  | 53 |  |  |  | (3,563 | ) |  |  | 87,852 |
Total |  |  | 1,435 |  |  | $ | (108,277 | ) |  | $ | 2,256,077 |  |  |  | 2,378 |  |  | $ | (420,578 | ) |  | $ | 7,913,360 |  |  |  | 3,813 |  |  | $ | (528,855 | ) |  | $ | 10,169,437 |

|  | December 31, 2023 |
|  | Less than 12 months |  |  | 12 months or more |  |  | Total |
|  | Number of Issues |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Number of Issues |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Number of Issues |  |  | Gross Unrealized Losses |  |  | Fair Value |
Fixed maturity, bonds available-for-sale |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. treasury and government |  |  | 17 |  |  | $ | (531 | ) |  | $ | 27,163 |  |  |  | 35 |  |  | $ | (823 | ) |  | $ | 24,902 |  |  |  | 52 |  |  | $ | (1,354 | ) |  | $ | 52,065 |
U.S. states and political subdivisions |  |  | 214 |  |  |  | (3,210 | ) |  |  | 218,774 |  |  |  | 142 |  |  |  | (13,570 | ) |  |  | 284,892 |  |  |  | 356 |  |  |  | (16,780 | ) |  |  | 503,666 |
Foreign governments |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 2 |  |  |  | (276 | ) |  |  | 9,103 |  |  |  | 2 |  |  |  | (276 | ) |  |  | 9,103 |
Corporate debt securities |  |  | 1,343 |  |  |  | (141,365 | ) |  |  | 2,941,484 |  |  |  | 1,906 |  |  |  | (278,510 | ) |  |  | 6,474,799 |  |  |  | 3,249 |  |  |  | (419,875 | ) |  |  | 9,416,283 |
Collateralized debt securities |  |  | 102 |  |  |  | (4,272 | ) |  |  | 257,735 |  |  |  | 201 |  |  |  | (22,971 | ) |  |  | 781,849 |  |  |  | 303 |  |  |  | (27,243 | ) |  |  | 1,039,584 |
Residential mortgage-backed securities |  |  | 6 |  |  |  | (895 | ) |  |  | 39,089 |  |  |  | 39 |  |  |  | (3,129 | ) |  |  | 64,057 |  |  |  | 45 |  |  |  | (4,024 | ) |  |  | 103,146 |
Total |  |  | 1,682 |  |  | $ | (150,273 | ) |  | $ | 3,484,245 |  |  |  | 2,325 |  |  | $ | (319,279 | ) |  | $ | 7,639,602 |  |  |  | 4,007 |  |  | $ | (469,552 | ) |  | $ | 11,123,847 |

11

Note 4 – Investment in Securities – (Continued)

Several assumptions and underlying estimates are made in the evaluation of allowance for credit loss. Examples include financial condition, near-term and long-term prospects of the issue or issuer, including relevant industry conditions and trends and implications of rating agency actions and offering prices. Based on this evaluation, unrealized losses on bonds available-for-sale where an allowance for credit loss was not recorded were concentrated in the Company's fixed maturity securities within the transportation sector.

Equity securities by market sector distribution are shown below, based on fair value:

|  | March 31, 2024 |  |  | December 31, 2023 |
Energy and utilities |  | $ | 382,258 |  |  |  | 26.8 | % |  | $ | 426,087 |  |  |  | 30.2 | %
Finance |  |  | 363,311 |  |  |  | 25.5 |  |  |  | 338,052 |  |  |  | 24.0 |
Healthcare |  |  | 86,940 |  |  |  | 6.1 |  |  |  | 119,620 |  |  |  | 8.5 |
Industrials |  |  | 45,579 |  |  |  | 3.2 |  |  |  | 47,506 |  |  |  | 3.4 |
Information technology |  |  | 302,661 |  |  |  | 21.2 |  |  |  | 253,859 |  |  |  | 18.0 |
Other |  |  | 245,621 |  |  |  | 17.2 |  |  |  | 219,123 |  |  |  | 15.9 |
Total |  |  | 1,426,370 |  |  |  | 100 | % |  | $ | 1,404,247 |  |  |  | 100 | %

Allowance for Credit Losses

Available-for-Sale Securities—For available-for-sale bonds in an unrealized loss position, the Company first assesses whether it intends to sell the security or will be required to sell the security before recovery of its amortized cost basis. If either of these criteria are met, the security’s amortized cost basis is written down to fair value through income. For bonds available-for-sale that do not meet either indicated criteria, the Company evaluates whether the decline in fair value has resulted from credit events or market factors. In making this assessment, management first calculates the extent to which fair value is less than amortized cost, and then may consider any changes to the rating of the security by a rating agency, and any specific conditions related to the security. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security is compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded through income, limited to the amount fair value is less than amortized cost. Any remaining unrealized loss is recognized in other comprehensive income.

When the discounted cash flow method is used to determine the allowance for credit losses, management's estimates incorporate expected prepayments, if any. Model inputs are considered reasonable and supportable for three years. A mean reversion is applied in years four and five. Credit loss allowance is not measured on accrued interest receivable because the balance is written

off to net investment income in a timely manner, within 90 days. Changes in the allowance for credit losses are recognized through the condensed consolidated statement of operations as "(Increase) decrease in investment credit loss."

No accrued interest receivables were written off as of March 31, 2024 and 2023.

12

Note 4 – Investment in Securities – (Continued)

The rollforward of the allowance for credit losses for available-for-sale debt securities is shown below (in thousands):

|  | U.S. State and Political Subdivisions |  |  | Foreign Governments |  |  | Corporate Debt Securities |  |  | Collateralized Debt Securities |  |  | Residential Mortgage Backed Securities |  |  | Total |
Balance at January 1, 2024 |  | $ | (181 | ) |  | $ | (24 | ) |  | $ | (18,951 | ) |  | $ | (4,367 | ) |  | $ | (695 | ) |  | $ | (24,218 | )
Increase in allowance related to purchases |  |  | — |  |  |  | — |  |  |  | (14,998 | ) |  |  | (270 | ) |  |  | — |  |  |  | (15,268 | )
Reduction in allowance related to dispositions |  |  | 154 |  |  |  | — |  |  |  | 918 |  |  |  | 69 |  |  |  | — |  |  |  | 1,141 |
Allowance on securities that had an allowance recorded in a previous period |  |  | (31 | ) |  |  | 24 |  |  |  | 14,272 |  |  |  | 2,135 |  |  |  | 255 |  |  |  | 16,655 |
Allowance on securities where credit losses were not previously recorded |  |  | (33 | ) |  |  | — |  |  |  | (5,471 | ) |  |  | (62 | ) |  |  | — |  |  |  | (5,566 | )
Balance at March 31, 2024 |  | $ | (91 | ) |  | $ | — |  |  | $ | (24,230 | ) |  | $ | (2,495 | ) |  | $ | (440 | ) |  | $ | (27,256 | )

|  | U.S. State and Political Subdivisions |  |  | Foreign Governments |  |  | Corporate Debt Securities |  |  | Collateralized Debt Securities |  |  | Residential Mortgage Backed Securities |  |  | Total |
Balance at January 1, 2023 |  | $ | (742 | ) |  | $ | (12 | ) |  | $ | (23,049 | ) |  | $ | (4,574 | ) |  | $ | (331 | ) |  | $ | (28,708 | )
Increase in allowance related to purchases |  |  | — |  |  |  | — |  |  |  | (16 | ) |  |  | — |  |  |  | — |  |  |  | (16 | )
Reduction in allowance related to dispositions |  |  | — |  |  |  | — |  |  |  | 996 |  |  |  | — |  |  |  | — |  |  |  | 996 |
Allowance on securities that had an allowance recorded in a previous period |  |  | 530 |  |  |  | 12 |  |  |  | 11,219 |  |  |  | 355 |  |  |  | 213 |  |  |  | 12,329 |
Allowance on securities where credit losses were not previously recorded |  |  | (2 | ) |  |  | — |  |  |  | (660 | ) |  |  | (5,498 | ) |  |  | — |  |  |  | (6,160 | )
Balance at March 31, 2023 |  | $ | (214 | ) |  | $ | — |  |  | $ | (11,510 | ) |  | $ | (9,717 | ) |  | $ | (118 | ) |  | $ | (21,559 | )

Credit Quality Indicators

The Company monitors the credit quality of bonds available-for-sale through the use of credit ratings provided by third party rating agencies, which are updated on a monthly basis. Information is also gathered regarding the asset performance of available-for-sale bonds. The two traditional metrics for assessing interest rate risks are interest-coverage ratios and capitalization ratios, which can also be used in the assessment of credit risk. These risks are mitigated through the diversification of bond investments. Categories of diversification include credit ratings, geographic locations, maturities, and market sector.

13

Note 5 – Mortgage Loans

Generally, commercial mortgage loans are secured by first liens on income-producing real estate. American National attempts to maintain a diversified portfolio by considering both the location of the underlying collateral as well as the type of mortgage loan. The geographic categories come from the U.S. Census Bureau's "Census Regions and Divisions of the United States."

The distribution based on carrying amount of mortgage loans by location is as follows (in thousands, except percentages):

|  | March 31, 2024 |  |  | December 31, 2023 |
|  | Amount |  |  | Percentage |  |  | Amount |  |  | Percentage |
East North Central |  | $ | 798,883 |  |  |  | 14.3 | % |  | $ | 822,459 |  |  |  | 14.5 | %
East South Central |  |  | 40,609 |  |  |  | 0.7 |  |  |  | 49,219 |  |  |  | 0.9 |
Mountain |  |  | 1,305,795 |  |  |  | 23.4 |  |  |  | 1,317,761 |  |  |  | 23.3 |
Pacific |  |  | 904,771 |  |  |  | 16.2 |  |  |  | 899,549 |  |  |  | 15.9 |
South Atlantic |  |  | 976,996 |  |  |  | 17.5 |  |  |  | 989,930 |  |  |  | 17.5 |
West South Central |  |  | 1,033,041 |  |  |  | 18.5 |  |  |  | 1,066,151 |  |  |  | 18.8 |
Other |  |  | 521,536 |  |  |  | 9.4 |  |  |  | 512,954 |  |  |  | 9.1 |
Total |  | $ | 5,581,631 |  |  |  | 100.0 | % |  | $ | 5,658,023 |  |  |  | 100.0 | %

As of March 31, 2024 and December 31, 2023, loans in foreclosure and loans foreclosed are as follows (in thousands, except number of loans):

|  | March 31, 2024 |  |  | December 31, 2023 |
Foreclosure and foreclosed |  | Number of Loans |  |  | Recorded Investment |  |  | Number of Loans |  |  | Recorded Investment |
In foreclosure |  |  | 3 |  |  | $ | 21,535 |  |  |  | — |  |  | $ | — |
Filed for bankruptcy |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Total in foreclosure |  |  | 3 |  |  | $ | 21,535 |  |  |  | — |  |  | $ | — |
Foreclosed |  |  | 1 |  |  | $ | 38,502 |  |  |  | 3 |  |  | $ | 79,430 |

14

Note 5 – Mortgage Loans – (Continued)

The age analysis of past due loans is shown below (in thousands, except percentages):

|  | 30-59 Days |  |  | 60-89 Days |  |  | More Than 90 Days |  |  |  |  |  |  |  |  | Total |
March 31, 2024 |  | Past Due |  |  | Past Due |  |  | Past Due |  |  | Total |  |  | Current |  |  | Amount |  |  | Percentage |
Apartment |  | $ | 50,000 |  |  | $ | 19,965 |  |  | $ | — |  |  | $ | 69,965 |  |  | $ | 1,067,659 |  |  | $ | 1,137,624 |  |  |  | 20.2 | %
Hotel |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 947,937 |  |  |  | 947,937 |  |  |  | 16.8 |
Industrial |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,053,845 |  |  |  | 1,053,845 |  |  |  | 18.7 |
Office |  |  | 2,409 |  |  |  | 94,521 |  |  |  | 27,349 |  |  |  | 124,279 |  |  |  | 804,994 |  |  |  | 929,273 |  |  |  | 16.5 |
Parking |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 366,692 |  |  |  | 366,692 |  |  |  | 6.5 |
Retail |  |  | 10,447 |  |  |  | — |  |  |  | — |  |  |  | 10,447 |  |  |  | 779,011 |  |  |  | 789,458 |  |  |  | 14.0 |
Storage |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 118,070 |  |  |  | 118,070 |  |  |  | 2.1 |
Other |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 292,577 |  |  |  | 292,577 |  |  |  | 5.2 |
Total |  | $ | 62,856 |  |  | $ | 114,486 |  |  | $ | 27,349 |  |  | $ | 204,691 |  |  | $ | 5,430,785 |  |  | $ | 5,635,476 |  |  |  | 100.0 | %
Allowance for credit losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (53,845 | ) |  |  |  |
Total, net of allowance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 5,581,631 |  |  |  |  |

|  | 30-59 Days |  |  | 60-89 Days |  |  | More Than 90 Days |  |  |  |  |  |  |  |  | Total |
December 31, 2023 |  | Past Due |  |  | Past Due |  |  | Past Due |  |  | Total |  |  | Current |  |  | Amount |  |  | Percentage |
Apartment |  | $ | — |  |  | $ | 50,000 |  |  | $ | — |  |  | $ | 50,000 |  |  | $ | 1,040,743 |  |  | $ | 1,090,743 |  |  |  | 17.3 | %
Hotel |  |  | — |  |  |  | 13,212 |  |  |  | — |  |  |  | 13,212 |  |  |  | 952,640 |  |  |  | 965,852 |  |  |  | 17.9 |
Industrial |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,052,491 |  |  |  | 1,052,491 |  |  |  | 19.0 |
Office |  |  | 22,182 |  |  |  | — |  |  |  | 5,260 |  |  |  | 27,442 |  |  |  | 971,781 |  |  |  | 999,223 |  |  |  | 16.0 |
Parking |  |  | — |  |  |  | — |  |  |  | 9,257 |  |  |  | 9,257 |  |  |  | 404,303 |  |  |  | 413,560 |  |  |  | 7.3 |
Retail |  |  | 4,111 |  |  |  | — |  |  |  | — |  |  |  | 4,111 |  |  |  | 776,441 |  |  |  | 780,552 |  |  |  | 14.3 |
Storage |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 118,448 |  |  |  | 118,448 |  |  |  | 2.1 |
Other |  |  | 26,052 |  |  |  | — |  |  |  | — |  |  |  | 26,052 |  |  |  | 264,509 |  |  |  | 290,561 |  |  |  | 6.1 |
Total |  | $ | 52,345 |  |  | $ | 63,212 |  |  | $ | 14,517 |  |  | $ | 130,074 |  |  | $ | 5,581,356 |  |  | $ | 5,711,430 |  |  |  | 100.0 | %
Allowance for credit losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (53,407 | ) |  |  |  |
Total, net of allowance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 5,658,023 |  |  |  |  |

Modifications to Borrowers Experiencing Financial Difficulty

The Company may modify the terms of a loan when the borrower is experiencing financial difficulties, as a means to optimize recovery of amounts due on the loan. Modifications may involve temporary relief, such as payment forbearance for a short period

of time (where interest continues to accrue) or may involve more substantive changes to a loan. Changes to the terms of a loan, pursuant to a modification agreement, are factored into the analysis of the loan’s expected credit losses, under the allowance

model applicable to the loan.

For commercial mortgage loans, modifications for borrowers experiencing financial difficulty are tailored for individual loans and may include interest rate relief, maturity extensions or, less frequently, principal forgiveness. For residential mortgage loans, the most common modifications for borrowers experiencing financial difficulty, aside from insignificant delays in payment, typically involve interest rate relief, deferral of missed payments to the end of the loan term, or maturity extensions.

For the 12 month period between March 31, 2023 and March 31, 2024, maturity extensions on nine loans to borrowers experiencing financial difficulty were in place. These loan term modifications total $82.0 million in amortized cost and range from 3 to 24 months representing approximately 1.4% of the portfolio segment.

15

Note 5 – Mortgage Loans – (Continued)

Allowance for Credit Losses

Mortgage loans on real estate are stated at unpaid principal balance, adjusted for any unamortized discount, deferred expenses and allowances. The allowance for credit losses is based upon the current expected credit loss model. The model considers past loss experience, current economic conditions, and reasonable and supportable forecasts of future conditions. Reversion for the allowance calculation is implicit in the models used to determine the allowance. The methodology uses a discounted cash flow approach based on expected cash flows.

The rollforward of the allowance for credit losses for mortgage loans is shown below (in thousands):

|  | Commercial Mortgage Loans |
Balance at December 31, 2023 |  | $ | (53,407 | )
Provision |  |  | (438 | )
Balance at March 31, 2024 |  | $ | (53,845 | )

|  | Commercial Mortgage Loans |
Balance at December 31, 2022 |  | $ | (38,266 | )
Charge offs |  |  | (15,051 | )
Provision |  |  | 3,886 |
Balance at March 31, 2023 |  | $ | (49,431 | )

The asset and allowance balances for credit losses for mortgage loans by property-type are shown below (in thousands):

|  | March 31, 2024 |  |  | December 31, 2023 |
|  | Asset Balance |  |  | Allowance |  |  | Asset Balance |  |  | Allowance |
Apartment |  | $ | 1,137,624 |  |  | $ | (9,163 | ) |  | $ | 1,090,743 |  |  | $ | (3,155 | )
Hotel |  |  | 947,937 |  |  |  | (1,777 | ) |  |  | 965,852 |  |  |  | (2,162 | )
Industrial |  |  | 1,053,845 |  |  |  | (4,093 | ) |  |  | 1,052,491 |  |  |  | (871 | )
Office |  |  | 929,273 |  |  |  | (19,787 | ) |  |  | 999,223 |  |  |  | (28,844 | )
Parking |  |  | 366,692 |  |  |  | (414 | ) |  |  | 413,560 |  |  |  | (2,729 | )
Retail |  |  | 789,458 |  |  |  | (2,362 | ) |  |  | 780,552 |  |  |  | (3,324 | )
Storage |  |  | 118,070 |  |  |  | (579 | ) |  |  | 118,448 |  |  |  | (346 | )
Other |  |  | 292,577 |  |  |  | (15,670 | ) |  |  | 290,561 |  |  |  | (11,976 | )
Total |  | $ | 5,635,476 |  |  | $ | (53,845 | ) |  | $ | 5,711,430 |  |  | $ | (53,407 | )

16

Note 5 – Mortgage Loans – (Continued)

Credit Quality Indicators

Mortgage loans are segregated by property-type and quantitative and qualitative allowance factors are applied. Qualitative factors are developed quarterly based on the pooling of assets with similar risk characteristics and historical loss experience adjusted for the expected trend in the current market environment. Credit losses are pooled by property-type as it represents the most similar and reliable risk characteristics in our portfolio. The amortized cost of mortgage loans by year of origination by property-type are shown below (in thousands):

|  |  | Amortized Cost Basis by Origination Year |  |  |  |  |
|  |  | 2024 |  |  |  | 2023 |  |  |  | 2022 |  |  |  | 2021 |  |  |  | 2020 |  |  |  | Prior |  |  |  | Total |
Apartment |  | $ | — |  |  | $ | 72,657 |  |  | $ | 526,782 |  |  | $ | 278,291 |  |  | $ | 83,020 |  |  | $ | 176,874 |  |  | $ | 1,137,624 |
Hotel |  |  | — |  |  |  | 125,705 |  |  |  | 227,062 |  |  |  | 32,056 |  |  |  | 38,629 |  |  |  | 524,485 |  |  |  | 947,937 |
Industrial |  |  | — |  |  |  | 2,032 |  |  |  | 319,257 |  |  |  | 160,106 |  |  |  | 214,110 |  |  |  | 358,340 |  |  |  | 1,053,845 |
Office |  |  | — |  |  |  | 100,248 |  |  |  | 101,220 |  |  |  | 6,654 |  |  |  | 23,789 |  |  |  | 697,362 |  |  |  | 929,273 |
Parking |  |  | — |  |  |  | — |  |  |  | 54,763 |  |  |  | 28,816 |  |  |  | 24,022 |  |  |  | 259,091 |  |  |  | 366,692 |
Retail |  |  | — |  |  |  | — |  |  |  | 232,361 |  |  |  | 118,608 |  |  |  | 64,153 |  |  |  | 374,336 |  |  |  | 789,458 |
Storage |  |  | — |  |  |  | — |  |  |  | 8,158 |  |  |  | 20,476 |  |  |  | 36,028 |  |  |  | 53,408 |  |  |  | 118,070 |
Other |  |  | — |  |  |  | 29,480 |  |  |  | 137,931 |  |  |  | 44,275 |  |  |  | — |  |  |  | 80,891 |  |  |  | 292,577 |
Total |  | $ | — |  |  | $ | 330,122 |  |  | $ | 1,607,534 |  |  | $ | 689,282 |  |  | $ | 483,751 |  |  | $ | 2,524,787 |  |  | $ | 5,635,476 |
Allowance for credit losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (53,845 | )
Total, net of allowance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 5,581,631 |

Generally, mortgage loans are secured by first liens on income-producing real estate with a loan-to-value ratio of up to 75%. It is the Company's policy to not accrue interest on loans that are 90 days delinquent and where amounts are determined to be uncollectible. At March 31, 2024, four commercial loans were past due over 90 days or in non-accrual status.

Off-Balance Sheet Credit Exposures

The Company has off-balance sheet credit exposures related to non-cancellable unfunded commitment amounts on commercial mortgage loans. We estimate the allowance for these exposures by applying the allowance rate we computed for each property type to the related outstanding commitment amounts. As of March 31, 2024, we have included a $4.8 million (December 31, 2023 — $3.5 million) liability in other liabilities on the condensed consolidated statements of financial position based on unfunded loan commitments of $433 million (December 31, 2023 — $468 million).

17

Note 6 - Real Estate and Other Investments

The Company's real estate investment portfolio is diversified by property type, geography and income stream, including income from operating leases, and equity in earnings from equity method real estate joint ventures. Real estate investments were as follows (in thousands, except percentages):

|  | March 31, 2024 |  |  | December 31, 2023 |
|  | Carrying Value |
Wholly-owned real estate |  |  |  |  |  |  |  |
Leased real estate |  | $ | 691,812 |  |  | $ | 755,011 |
Real estate partnerships |  |  | 2,862,551 |  |  |  | 2,855,842 |
Total real estate and real estate partnerships |  | $ | 3,554,363 |  |  | $ | 3,610,853 |

|  | March 31, 2024 |  |  | December 31, 2023 |
Property Type |  | Carrying Value |
Leased real estate investments |  | Amount |  |  | Percentage |  |  | Amount |  |  | Percentage |
Hotel |  | $ | 13,675 |  |  |  | 2.0 | % |  | $ | 13,933 |  |  |  | 1.8 | %
Industrial |  |  | 27,126 |  |  |  | 3.9 |  |  |  | 65,116 |  |  |  | 8.6 |
Land |  |  | 36,580 |  |  |  | 5.3 |  |  |  | 37,177 |  |  |  | 4.9 |
Office |  |  | 317,500 |  |  |  | 45.9 |  |  |  | 358,422 |  |  |  | 47.5 |
Retail |  |  | 235,244 |  |  |  | 34.0 |  |  |  | 218,029 |  |  |  | 28.9 |
Apartments |  |  | 59,807 |  |  |  | 8.6 |  |  |  | 59,783 |  |  |  | 7.9 |
Other |  |  | 1,880 |  |  |  | 0.3 |  |  |  | 2,551 |  |  |  | 0.4 |
Total leased real estate investments |  | $ | 691,812 |  |  |  | 100.0 | % |  | $ | 755,011 |  |  |  | 100.0 | %

|  | March 31, 2024 |  |  | December 31, 2023 |
Geography Type |  | Carrying Value |
Leased real estate investments |  | Amount |  |  | Percentage |  |  | Amount |  |  | Percentage |
East North Central |  | $ | 11,079 |  |  |  | 1.6 | % |  | $ | 36,393 |  |  |  | 4.8 | %
East South Central |  |  | 4,570 |  |  |  | 0.7 |  |  |  | 4,576 |  |  |  | 0.6 |
Mountain |  |  | 12,484 |  |  |  | 1.8 |  |  |  | 54,942 |  |  |  | 7.3 |
Pacific |  |  | 69,491 |  |  |  | 10.0 |  |  |  | 70,765 |  |  |  | 9.4 |
South Atlantic |  |  | 230,964 |  |  |  | 33.4 |  |  |  | 196,507 |  |  |  | 26.0 |
West South Central |  |  | 304,163 |  |  |  | 44.0 |  |  |  | 313,886 |  |  |  | 41.6 |
Other |  |  | 59,062 |  |  |  | 8.5 |  |  |  | 77,942 |  |  |  | 10.3 |
Total leased real estate investments |  | $ | 691,812 |  |  |  | 100.0 | % |  | $ | 755,011 |  |  |  | 100.0 | %

As of March 31, 2024 and December 31, 2023, no real estate investments met the criteria as held-for-sale.

18

Note 6 – Real Estate and Other Investments – (Continued)

Consolidated VIEs

American National regularly invests in real estate partnerships and frequently participates in the design with the sponsor, but in most cases, its involvement is limited to financing. Some of these partnerships have been determined to be variable interest entities (“VIEs”). In certain instances, in addition to an economic interest in the entity, American National holds the power to direct significant activities of the entity and is deemed the primary beneficiary. The assets of the consolidated VIEs are restricted and must first be used to settle their liabilities. Creditors or beneficial interest holders of these VIEs have no recourse to the general credit of American National, as American National’s obligation is limited to the amount of its committed investment.

American National has not provided financial or other support to the VIEs in the form of liquidity arrangements, guarantees, or other commitments to third-parties that may affect the fair value or risk of its variable interest in the VIEs in 2024 or 2023.

The assets and liabilities relating to the VIEs included in the condensed consolidated financial statements are as follows (in thousands):

|  | March 31, 2024 |  |  | December 31, 2023 |
Fixed maturity securities, bonds available-for-sale, at estimated fair value |  | $ | 191,666 |  |  | $ | 63,025 |
Private loans, net |  |  | 192,014 |  |  |  | 187,849 |
Equity securities, at fair value |  |  | 15,000 |  |  |  | 15,004 |
Real estate and real estate partnerships, net of accumulated depreciation |  |  | 239,804 |  |  |  | 172,131 |
Investment funds |  |  | 7,208 |  |  |  | 4,480 |
Short-term investments |  |  | 4,193 |  |  |  | 4,100 |
Total investments |  | $ | 649,885 |  |  | $ | 446,589 |
Cash and cash equivalents |  |  | 72,455 |  |  |  | 25,751 |
Premiums due and other receivables |  |  | 2,586 |  |  |  | 1,867 |
Other assets |  |  | 24,763 |  |  |  | 59,284 |
Total assets of consolidated VIEs |  | $ | 749,689 |  |  | $ | 533,491 |
Notes payable |  |  | 184,601 |  |  |  | 174,017 |
Other liabilities |  |  | (3,531 | ) |  |  | 13,885 |
Total liabilities of consolidated VIEs |  | $ | 181,070 |  |  | $ | 187,902 |

The notes payable in the condensed consolidated statements of financial position pertain to the borrowings of the consolidated VIEs. The liability of American National relating to notes payable of the consolidated VIEs is limited to the amount of its direct or indirect investment in the respective ventures, which totaled $2.8 million and $2.9 million at March 31, 2024 and December 31, 2023, respectively.

The total long-term notes payable of the consolidated VIEs consists of the following (in thousands):

Interest rate |  | Maturity |  |  | March 31, 2024 |  |  | December 31, 2023 |
4.18% fixed |  |  | 2024 |  |  |  | 61,465 |  |  |  | 61,478 |
1M TermSOFR + applicable margin |  |  | 2025 |  |  |  | 19,376 |  |  |  | 12,683 |
3.25% |  |  | 2026 |  |  |  | 11,569 |  |  |  | 9,842 |
7.25% |  |  | 2026 |  |  |  | 10,567 |  |  |  | 10,600 |
1M SOFR + 2.5%, Rate Floor 3.5% |  |  | 2029 |  |  |  | 81,624 |  |  |  | 79,414 |
Total notes payable of ANTAC consolidated VIEs |  |  |  |  |  | $ | 184,601 |  |  | $ | 174,017 |

19

Note 6 – Real Estate and Other Investments – (Continued)

Unconsolidated VIEs

|  | March 31, 2024 |  |  | December 31, 2023 |
|  | Carrying Amount |  |  | Maximum Exposure to Loss |  |  | Carrying Amount |  |  | Maximum Exposure to Loss |
Real estate and real estate partnerships |  | $ | 432,659 |  |  | $ | 432,659 |  |  | $ | 300,959 |  |  | $ | 300,959 |
Mortgage loans on real estate |  |  | 647,201 |  |  |  | 647,201 |  |  |  | 629,840 |  |  |  | 629,840 |
Accrued investment income |  |  | 2,730 |  |  |  | 2,730 |  |  |  | 2,272 |  |  |  | 2,272 |

American National’s equity in earnings of real estate partnerships is the Company’s share of operating earnings and realized gains from investments in real estate joint ventures and other limited partnership interests (“joint ventures”) using the equity method of accounting.

The Company’s total investment in investment funds, real estate partnerships, and other partnerships of which substantially all are limited liability companies ("LLCs") or limited partnerships, was comprised of $4.7 billion and $4.4 billion at March 31, 2024 and December 31, 2023, respectively.

20

Note 7 – Derivative Instruments

American National purchases over-the-counter equity-indexed options as economic hedges against fluctuations in the equity markets to which equity-indexed products are exposed. These options are not designated as hedging instruments for accounting purposes under GAAP. Equity-indexed contracts include a fixed host universal-life insurance or annuity contract and an equity-indexed embedded derivative. The detail of derivative instruments is shown below (in thousands, except number of instruments):

|  |  |  | March 31, 2024 |  |  | December 31, 2023 |
Derivatives Not Designated as Hedging Instruments |  | Location in the Condensed Consolidated Statements of Financial Position |  | Number of Instruments |  |  | Notional Amounts |  |  | Estimated Fair Value |  |  | Number of Instruments |  |  | Notional Amounts |  |  | Estimated Fair Value |
Equity-indexed options |  | Other invested assets |  |  | 647 |  |  | $ | 4,142,900 |  |  | $ | 256,590 |  |  |  | 652 |  |  | $ | 4,083,900 |  |  | $ | 226,644 |
Equity-indexed embedded derivative |  | Policyholders’ account balances |  |  | 140,864 |  |  |  | 3,896,000 |  |  |  | 904,077 |  |  |  | 140,382 |  |  |  | 3,845,098 |  |  |  | 872,746 |

|  |  |  | Gains (Losses) Recognized in Income on Derivatives |
|  |  |  | QTD |
Derivatives Not Designated as Hedging Instruments |  | Location in the Condensed Consolidated Statements of Operations |  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
Equity-indexed options |  | Net investment income |  | $ | 56,543 |  |  | $ | 24,648 |
Equity-indexed embedded derivative |  | Interest credited to policyholders’ account balances |  |  | (37,541 | ) |  |  | (50,683 | )

The Company’s use of derivative instruments exposes it to credit risk in the event of non-performance by counterparties. The Company has a policy of only dealing with counterparties it believes are creditworthy and obtaining sufficient collateral where appropriate, as a means of mitigating the financial loss from defaults. The Company holds collateral in cash and notes secured by U.S. government-backed assets. The non-performance risk is the net counterparty exposure based on fair value of open contracts less fair value of collateral held. The Company maintains master netting agreements with its current active trading partners. A right of offset has been applied to collateral that supports credit risk and has been recorded in the condensed consolidated statements of financial position as an offset to “Other invested assets” with an associated payable to “Other liabilities” for excess collateral.

21

Note 7 – Derivative Instruments – (Continued)

Information regarding the Company’s exposure to credit loss on the options it holds is presented below (in thousands):

|  |  |  | March 31, 2024 |
Counterparty |  | Moody/S&P Rating |  | Options Fair Value |  |  | Collateral Held in Cash |  |  | Collateral Held in Invested Assets |  |  | Total Collateral Held |  |  | Collateral Amounts Used to Offset Exposure |  |  | Excess Collateral |  |  | Exposure Net of Collateral |
Bank of America |  | A1/A- |  | $ | 24,504 |  |  | $ | 23,160 |  |  | $ | — |  |  | $ | 23,160 |  |  | $ | 23,160 |  |  | $ | — |  |  | $ | 1,344 |
Barclays |  | Baa1/BBB+ |  |  | 25,122 |  |  |  | 15,103 |  |  |  | 10,000 |  |  |  | 25,103 |  |  |  | 24,988 |  |  |  | 115 |  |  |  | 134 |
Credit Suisse |  | WR/NR |  |  | 14,577 |  |  |  | 14,380 |  |  |  | — |  |  |  | 14,380 |  |  |  | 14,192 |  |  |  | 188 |  |  |  | 385 |
ING |  | Baa1/A- |  |  | 7,016 |  |  |  | 7,050 |  |  |  | — |  |  |  | 7,050 |  |  |  | 7,016 |  |  |  | 34 |  |  |  | — |
JP Morgan Chase |  | A1/A- |  |  | 20,006 |  |  |  | 18,205 |  |  |  | — |  |  |  | 18,205 |  |  |  | 18,205 |  |  |  | — |  |  |  | 1,801 |
Morgan Stanley |  | A1/A- |  |  | 57,913 |  |  |  | 52,616 |  |  |  | 5,700 |  |  |  | 58,316 |  |  |  | 57,913 |  |  |  | 403 |  |  |  | — |
NATIXIS* |  | A1/A |  |  | 3,609 |  |  |  | 3,420 |  |  |  | — |  |  |  | 3,420 |  |  |  | 3,420 |  |  |  | — |  |  |  | 188 |
Truist |  | A3/A- |  |  | 53,423 |  |  |  | 51,570 |  |  |  | 5,000 |  |  |  | 56,570 |  |  |  | 53,173 |  |  |  | 3,397 |  |  |  | 250 |
Wells Fargo |  | A1/BBB+ |  |  | 50,420 |  |  |  | 51,730 |  |  |  | — |  |  |  | 51,730 |  |  |  | 50,214 |  |  |  | 1,517 |  |  |  | 207 |
Total |  |  |  | $ | 256,590 |  |  | $ | 237,234 |  |  | $ | 20,700 |  |  | $ | 257,934 |  |  | $ | 252,281 |  |  | $ | 5,654 |  |  | $ | 4,309 |

|  |  |  | December 31, 2023 |
Counterparty |  | Moody/S&P Rating |  | Options Fair Value |  |  | Collateral Held in Cash |  |  | Collateral Held in Invested Assets |  |  | Total Collateral Held |  |  | Collateral Amounts Used to Offset Exposure |  |  | Excess Collateral |  |  | Exposure Net of Collateral |
Bank of America |  | A2/A- |  | $ | 23,798 |  |  | $ | 23,430 |  |  | $ | — |  |  | $ | 23,430 |  |  | $ | 23,430 |  |  | $ | — |  |  | $ | 368 |
Barclays |  | Baa2/BBB |  |  | 24,363 |  |  |  | 14,193 |  |  |  | 10,000 |  |  |  | 24,193 |  |  |  | 24,193 |  |  |  | — |  |  |  | 170 |
Credit Suisse |  | Baa1/BBB+ |  |  | 16,105 |  |  |  | 18,170 |  |  |  | — |  |  |  | 18,170 |  |  |  | 16,105 |  |  |  | 2,065 |  |  |  | — |
ING |  | Baa1/A- |  |  | 9,867 |  |  |  | 9,810 |  |  |  | — |  |  |  | 9,810 |  |  |  | 9,810 |  |  |  | — |  |  |  | 57 |
JP Morgan Chase |  | A1/A- |  |  | 12,148 |  |  |  | 12,370 |  |  |  | — |  |  |  | 12,370 |  |  |  | 12,148 |  |  |  | — |  |  |  | — |
Morgan Stanley |  | A1/A- |  |  | 42,984 |  |  |  | 38,166 |  |  |  | 5,700 |  |  |  | 43,866 |  |  |  | 42,984 |  |  |  | 882 |  |  |  | — |
NATIXIS* |  | A1/A |  |  | 3,483 |  |  |  | 3,420 |  |  |  | — |  |  |  | 3,420 |  |  |  | 3,420 |  |  |  | — |  |  |  | 63 |
Truist |  | A3/A- |  |  | 58,877 |  |  |  | 53,810 |  |  |  | 5,000 |  |  |  | 58,810 |  |  |  | 58,755 |  |  |  | 55 |  |  |  | 122 |
Wells Fargo |  | A1/BBB+ |  |  | 35,018 |  |  |  | 35,710 |  |  |  | — |  |  |  | 35,710 |  |  |  | 35,018 |  |  |  | 692 |  |  |  | — |
Total |  |  |  | $ | 226,643 |  |  | $ | 209,079 |  |  | $ | 20,700 |  |  | $ | 229,779 |  |  | $ | 225,863 |  |  | $ | 3,694 |  |  | $ | 780 |

* Collateral is prohibited from being held in invested assets.

22

Note 8 – Net Investment Income and Realized Investment Gains (Losses)

Net investment income is shown below (in thousands):

|  | QTD |
|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
Bonds |  | $ | 227,820 |  |  | $ | 156,623 |
Short-term investments |  |  | 31,737 |  |  |  | 34,078 |
Equity securities |  |  | 15,385 |  |  |  | (46 | )
Mortgage loans |  |  | 77,958 |  |  |  | 69,924 |
Real estate and real estate partnerships |  |  | 12,936 |  |  |  | 19,869 |
Investment funds |  |  | 35,055 |  |  |  | 19,038 |
Equity-indexed options |  |  | 56,543 |  |  |  | 24,648 |
Other invested assets |  |  | 12,785 |  |  |  | 16,968 |
Total |  | $ | 470,219 |  |  | $ | 341,102 |

Net investment income from equity method investments, comprised of real estate partnerships and investment funds was $48.0 million and $40.6 million for the three months ended March 31, 2024 and 2023, respectively.

Net realized investment gains (losses) are shown below (in thousands):

|  | QTD |
|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
Bonds |  | $ | 4,698 |  |  | $ | (24,903 | )
Mortgage loans |  |  | (5,691 | ) |  |  | — |
Real estate |  |  | 8,351 |  |  |  | 2,747 |
Other invested assets |  |  | (5,063 | ) |  |  | (211 | )
Total |  | $ | 2,295 |  |  | $ | (22,367 | )

23

Note 9 – Fair Value of Financial Instruments

The carrying amount and fair value of financial instruments are shown below (in thousands):

|  | March 31, 2024 |  |  | December 31, 2023 |
|  | Carrying Amount |  |  | Fair Value |  |  | Carrying Amount |  |  | Fair Value |
Financial assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed maturity, bonds available-for-sale |  | $ | 14,197,880 |  |  | $ | 14,197,880 |  |  | $ | 13,070,576 |  |  | $ | 13,070,576 |
Equity securities |  |  | 1,426,370 |  |  |  | 1,426,370 |  |  |  | 1,404,247 |  |  |  | 1,404,247 |
Equity-indexed options, included in other invested assets |  |  | 256,590 |  |  |  | 256,590 |  |  |  | 226,644 |  |  |  | 226,644 |
Mortgage loans on real estate, net of allowance |  |  | 5,581,631 |  |  |  | 5,290,171 |  |  |  | 5,658,023 |  |  |  | 5,405,016 |
Policy loans |  |  | 395,053 |  |  |  | 395,053 |  |  |  | 390,393 |  |  |  | 390,393 |
Short-term investments |  |  | 3,242,526 |  |  |  | 3,242,526 |  |  |  | 2,396,504 |  |  |  | 2,396,504 |
Separate account assets ($1,251,383 and $1,163,261 included in fair value hierarchy) |  |  | 1,284,939 |  |  |  | 1,284,939 |  |  |  | 1,188,989 |  |  |  | 1,188,989 |
Separately managed accounts, included in other invested assets |  |  | 105,796 |  |  |  | 105,796 |  |  |  | 104,698 |  |  |  | 104,698 |
Total financial assets |  | $ | 26,490,785 |  |  | $ | 26,199,325 |  |  | $ | 24,440,074 |  |  | $ | 24,187,067 |
Financial liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Investment contracts |  | $ | 14,437,256 |  |  | $ | 14,437,256 |  |  | $ | 14,096,714 |  |  | $ | 14,096,714 |
Embedded derivative liability for equity-indexed contracts |  |  | 904,077 |  |  |  | 904,077 |  |  |  | 872,746 |  |  |  | 872,746 |
Notes payable |  |  | 184,601 |  |  |  | 184,601 |  |  |  | 174,017 |  |  |  | 174,017 |
Separate account liabilities ($1,251,383 and $1,163,261 included in fair value hierarchy) |  |  | 1,284,939 |  |  |  | 1,284,939 |  |  |  | 1,188,989 |  |  |  | 1,188,989 |
Total financial liabilities |  | $ | 16,810,873 |  |  | $ | 16,810,873 |  |  | $ | 16,332,466 |  |  | $ | 16,332,466 |

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability. A fair value hierarchy is used to determine fair value based on a hypothetical transaction at the measurement date from the perspective of a market participant. American National has evaluated the types of securities in its investment portfolio to determine an appropriate hierarchy level based upon trading activity and the observability of market inputs. The classification of assets or liabilities within the fair value hierarchy is based on the lowest level of significant input to its valuation. The input levels are defined as follows:

Level 1 |  | Unadjusted quoted prices in active markets for identical assets or liabilities.
Level 2 |  | Quoted prices in markets that are not active or inputs that are observable directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities other than quoted prices in Level 1; quoted prices in markets that are not active; or other inputs that are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 |  | Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Unobservable inputs reflect American National’s own assumptions about the assumptions that market participants would use in pricing the asset or liability. Level 3 assets and liabilities include financial instruments whose values are determined using pricing models and third-party evaluation, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

24

Note 9 – Fair Value of Financial Instruments – (Continued)

Valuation Techniques for Financial Instruments Recorded at Fair Value

Fixed Maturity Securities and Equity Options—American National utilizes a pricing service to estimate fair value measurements. The fair value for fixed maturity securities that are disclosed as Level 1 measurements are based on unadjusted quoted market prices for identical assets that are readily available in an active market. The estimates of fair value for most fixed maturity securities, including municipal bonds, provided by the pricing service are disclosed as Level 2 measurements as the estimates are based on observable market information rather than market quotes. The pricing service utilizes market quotations for fixed maturity securities that have quoted prices in active markets. Since fixed maturity securities generally do not trade on a daily basis, the pricing service prepares estimates of fair value measurements for these securities using its proprietary pricing applications, which include available relevant market information, benchmark curves, benchmarking of like securities, sector groupings and matrix pricing. Additionally, an option adjusted spread model is used to develop prepayment and interest rate scenarios.

The pricing service evaluates each asset class based on relevant market information, credit information, perceived market movements and sector news. The market inputs utilized in the pricing evaluation, listed in the approximate order of priority, include: benchmark yields, reported trades, pricing source quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, reference data, and economic events. The extent of the use of each market input depends on the asset class and the market conditions. Depending on the security, the priority of the use of inputs may change or some market inputs may not be relevant. For some securities, additional inputs may be necessary.

American National has reviewed the inputs and methodology used and the techniques applied by the pricing service to produce quotes that represent the fair value of a specific security. The review confirms that the pricing service is utilizing information from observable transactions or a technique that represents a market participant’s assumptions. American National does not adjust quotes received from the pricing service. The pricing service utilized by American National has indicated that they will only produce an estimate of fair value if there is objectively verifiable information available.

American National holds a small amount of private placement debt and fixed maturity securities that have characteristics that make them unsuitable for matrix pricing. For these securities, a quote from an independent pricing source (typically a market maker) is obtained. Due to the disclaimers on the quotes that indicate the price is indicative only, American National includes these fair value estimates in Level 3.

For securities priced using a quote from an independent pricing source, such as the equity-indexed options and certain fixed maturity securities, American National uses a market-based fair value analysis to validate the reasonableness of prices received. Price variances above a certain threshold are analyzed further to determine if any pricing issue exists. This analysis is performed quarterly.

Equity Securities—For publicly-traded equity securities, prices are received from a nationally recognized pricing service that are based on observable market transactions, and these securities are classified as Level 1 measurements. For certain preferred stock, current market quotes in active markets are unavailable. In these instances, an estimated fair value is received from the pricing service. The service utilizes similar methodologies to price preferred stocks as it does for fixed maturity securities. If applicable, these estimates would be disclosed as Level 2 measurements. American National tests the accuracy of the information provided by reference to other services annually.

Short-term Investments—Short-term investments are primarily commercial paper rated A2 or P2 or better by Standard & Poor's and Moody's, respectively. Commercial paper is carried at amortized cost which approximates fair value. These investments are classified as Level 2 measurements.

25

Note 9 – Fair Value of Financial Instruments – (Continued)

Separate Account Assets and Liabilities—Separate account assets and liabilities are funds that are held separate from the general assets and liabilities of American National. Separate account assets include funds representing the investments of variable insurance product contract holders, who bear the investment risk of such funds. Investment income and investment gains and losses from these separate funds accrue to the benefit of the contract holders. American National reports separately, as assets and liabilities, investments held in such separate accounts and liabilities of the separate accounts if (i) such separate accounts are legally recognized; (ii) assets supporting the contract liabilities are legally insulated from American National’s general account liabilities; (iii) investments are directed by the contract holder; and (iv) all investment performance, net of contract fees and assessments, is passed through to the contract holder. In addition, American National's qualified pension plan assets are included in separate accounts. The assets of these accounts are carried at fair value. Deposits, net investment income and realized investment gains and losses for these accounts are excluded from revenues, and related liability increases are excluded from benefits and expenses in the condensed consolidated statements of operations. Separate accounts are established in conformity with insurance laws and are not chargeable with liabilities that arise from any other business of American National.

The separate account assets included on the quantitative disclosures fair value hierarchy table are comprised of short-term investments, equity securities, and fixed maturity bonds available-for-sale. Equity securities are classified as Level 1 measurements. Short-term investments and fixed maturity securities are classified as Level 2 measurements. These classifications for separate account assets reflect the same fair value level methodologies as listed above as they are derived from the same vendors and follow the same process.

The separate account assets also include cash and cash equivalents, investment funds, accrued investment income, and receivables for securities. These are not financial instruments and are not included in the quantitative disclosures of fair value hierarchy table.

The balances and changes in separate account assets and liabilities for the three months ended March 31, 2024 and 2023 were as follows (in thousands):

|  | March 31, 2024 |
|  | Variable Life |  |  | Variable Annuities |  |  | Pension |  |  | Total |
Balance, beginning of year |  | $ | 262,590 |  |  | $ | 390,669 |  |  | $ | 535,730 |  |  | $ | 1,188,989 |
Premiums and deposits |  |  | 2,816 |  |  |  | 16,518 |  |  |  | — |  |  |  | 19,334 |
Policy charges |  |  | (2,379 | ) |  |  | (1,132 | ) |  |  | (244 | ) |  |  | (3,755 | )
Surrenders and withdrawals |  |  | (4,741 | ) |  |  | (19,348 | ) |  |  | (20,609 | ) |  |  | (44,698 | )
Benefit payments |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Investment performance |  |  | 30,220 |  |  |  | 30,932 |  |  |  | 44,345 |  |  |  | 105,497 |
Net transfers from (to) general account |  |  | (963 | ) |  |  | 2,349 |  |  |  | 18,186 |  |  |  | 19,572 |
Balance, end of period |  | $ | 287,543 |  |  | $ | 419,988 |  |  | $ | 577,408 |  |  | $ | 1,284,939 |
Cash Surrender Value |  | $ | 287,143 |  |  | $ | 413,565 |  |  | $ | — |  |  | $ | 700,708 |
|  | December 31, 2023 |
|  | Variable Life |  |  | Variable Annuities |  |  | Pension |  |  | Total |
Balance, beginning of year |  | $ | 230,148 |  |  | $ | 349,820 |  |  | $ | 465,249 |  |  | $ | 1,045,217 |
Premiums and deposits |  |  | 11,015 |  |  |  | 64,415 |  |  |  | 1,585 |  |  |  | 77,015 |
Policy charges |  |  | (9,513 | ) |  |  | (4,602 | ) |  |  | (241 | ) |  |  | (14,356 | )
Surrenders and withdrawals |  |  | (17,099 | ) |  |  | (73,750 | ) |  |  | (261 | ) |  |  | (91,110 | )
Benefit payments |  |  | — |  |  |  | — |  |  |  | (22,959 | ) |  |  | (22,959 | )
Investment performance |  |  | 50,463 |  |  |  | 60,253 |  |  |  | 92,357 |  |  |  | 203,073 |
Net transfers from (to) general account |  |  | (2,424 | ) |  |  | (5,467 | ) |  |  | — |  |  |  | (7,891 | )
Balance, end of year |  | $ | 262,590 |  |  | $ | 390,669 |  |  | $ | 535,730 |  |  | $ | 1,188,989 |
Cash Surrender Value |  | $ | 260,879 |  |  | $ | 382,080 |  |  | $ | — |  |  | $ | 642,959 |

26

Note 9 – Fair Value of Financial Instruments – (Continued)

Embedded Derivatives—The amounts reported within policyholder contract deposits include equity linked interest crediting rates based on the S&P 500 within indexed annuities and indexed life. The following unobservable inputs are used for measuring the fair value of the embedded derivatives associated with the policyholder contract liabilities:

| · | Lapse rate assumptions are determined by company experience. Lapse rates are generally assumed to be lower during a contract’s surrender charge period and then higher once the surrender charge period has ended. Decreases to the assumed lapse rates generally increase the fair value of the liability as more policyholders persist to collect the crediting interest pertaining to the indexed product. Increases to the lapse rate assumption decrease the fair value.

| · | Mortality rate assumptions vary by age and gender based on company and industry experience. Decreases to the assumed mortality rates increase the fair value of the liabilities as more policyholders earn crediting interest. Increases to the assumed mortality rates decrease the fair value as higher decrements reduce the potential for future interest credits.

| · | Equity volatility assumptions begin with current market volatilities and grow to long-term values. Increases to the assumed volatility will increase the fair value of liabilities, as future projections will produce higher increases in the linked index. At March 31, 2024 and December 31, 2023, the one year implied volatility used to estimate embedded derivative value was 15.6% and 16.4%, respectively.

Fair values of indexed life and annuity liabilities are calculated using the discounted cash flow technique. Shown below are the significant unobservable inputs used to calculate the Level 3 fair value of the embedded derivatives within policyholder contract deposits (in millions, except range percentages):

|  | Fair Value |  |  |  |  | Range |
|  | March 31, 2024 |  |  | December 31, 2023 |  |  | Unobservable Input |  | March 31, 2024 |  |  | December 31, 2023 |
Security type |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Embedded derivative |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Indexed Annuities |  | $ | 851.6 |  |  | $ | 826.3 |  |  | Lapse Rate |  |  | 1-50% |  |  |  | 1-50% |
|  |  |  |  |  |  |  |  |  | Mortality Multiplier |  |  | 100% |  |  |  | 100% |
|  |  |  |  |  |  |  |  |  | Equity Volatility |  |  | 11-63% |  |  |  | 10-62% |
Indexed Life |  | $ | 52.5 |  |  | $ | 46.4 |  |  | Equity Volatility |  |  | 11-63% |  |  |  | 10-62% |

27

Note 9 – Fair Value of Financial Instruments – (Continued)

Quantitative Disclosures

The fair value hierarchy measurements of the financial instruments are shown below (in thousands):

|  | Assets and Liabilities Carried at Fair Value by Hierarchy Level at March 31, 2024 |
|  | Total Fair Value |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Financial assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed maturity, bonds available-for-sale |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. treasury and government |  | $ | 64,858 |  |  | $ | 64,858 |  |  | $ | — |  |  | $ | — |
U.S. states and political subdivisions |  |  | 550,977 |  |  |  | — |  |  |  | 550,977 |  |  |  | — |
Foreign governments |  |  | 9,010 |  |  |  | — |  |  |  | 9,010 |  |  |  | — |
Corporate debt securities |  |  | 12,084,369 |  |  |  | — |  |  |  | 9,419,851 |  |  |  | 2,664,518 |
Residential mortgage-backed securities |  |  | 126,129 |  |  |  | — |  |  |  | 126,129 |  |  |  | — |
Collateralized debt securities |  |  | 1,362,537 |  |  |  | — |  |  |  | 418,628 |  |  |  | 943,909 |
Total bonds available-for-sale |  |  | 14,197,880 |  |  |  | 64,858 |  |  |  | 10,524,595 |  |  |  | 3,608,427 |
Equity securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Common stock |  |  | 1,324,714 |  |  |  | 315,793 |  |  |  | — |  |  |  | 1,008,921 |
Preferred stock |  |  | 96,260 |  |  |  | 24,374 |  |  |  | — |  |  |  | 71,886 |
Private equity and other |  |  | 5,396 |  |  |  | — |  |  |  | — |  |  |  | 5,396 |
Total equity securities |  |  | 1,426,370 |  |  |  | 340,167 |  |  |  | — |  |  |  | 1,086,203 |
Options |  |  | 256,590 |  |  |  | — |  |  |  | — |  |  |  | 256,590 |
Short-term investments |  |  | 3,242,526 |  |  |  | 2,660,909 |  |  |  | — |  |  |  | 581,617 |
Separate account assets |  |  | 1,251,383 |  |  |  | 443,516 |  |  |  | 807,867 |  |  |  | — |
Separately managed accounts |  |  | 105,796 |  |  |  | — |  |  |  | — |  |  |  | 105,796 |
Total financial assets |  | $ | 20,480,545 |  |  | $ | 3,509,450 |  |  | $ | 11,332,462 |  |  | $ | 5,638,633 |
Financial liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Embedded derivative for equity-indexed contracts |  | $ | 904,077 |  |  | $ | — |  |  | $ | — |  |  | $ | 904,077 |
Separate account liabilities |  |  | 1,251,383 |  |  |  | 443,516 |  |  |  | 807,867 |  |  |  | — |
Total financial liabilities |  | $ | 2,155,460 |  |  | $ | 443,516 |  |  | $ | 807,867 |  |  | $ | 904,077 |

28

Note 9 – Fair Value of Financial Instruments – (Continued)

|  | Assets and Liabilities Carried at Fair Value by Hierarchy Level at December 31, 2023 |
|  | Total Fair Value |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Financial assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed maturity, bonds available-for-sale |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. treasury and government |  | $ | 62,228 |  |  | $ | 62,228 |  |  | $ | — |  |  | $ | — |
U.S. states and political subdivisions |  |  | 577,314 |  |  |  | — |  |  |  | 577,314 |  |  |  | — |
Foreign governments |  |  | 9,103 |  |  |  | — |  |  |  | 9,103 |  |  |  | — |
Corporate debt securities |  |  | 10,977,772 |  |  |  | — |  |  |  | 8,570,110 |  |  |  | 2,407,662 |
Residential mortgage-backed securities |  |  | 126,904 |  |  |  | — |  |  |  | 126,904 |  |  |  | — |
Collateralized debt securities |  |  | 1,317,255 |  |  |  | — |  |  |  | 416,226 |  |  |  | 901,029 |
Total bonds available-for-sale |  |  | 13,070,576 |  |  |  | 62,228 |  |  |  | 9,699,657 |  |  |  | 3,308,691 |
Equity securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Common stock |  |  | 1,307,700 |  |  |  | 313,951 |  |  |  | — |  |  |  | 993,749 |
Preferred stock |  |  | 96,547 |  |  |  | 21,620 |  |  |  | — |  |  |  | 74,927 |
Total equity securities |  |  | 1,404,247 |  |  |  | 335,571 |  |  |  | — |  |  |  | 1,068,676 |
Options |  |  | 226,644 |  |  |  | — |  |  |  | — |  |  |  | 226,644 |
Short-term investments |  |  | 2,396,504 |  |  |  | 1,099,820 |  |  |  | — |  |  |  | 1,296,684 |
Separate account assets |  |  | 1,163,261 |  |  |  | 405,738 |  |  |  | 757,523 |  |  |  | — |
Separately managed accounts |  |  | 104,698 |  |  |  | — |  |  |  | — |  |  |  | 104,698 |
Total financial assets |  | $ | 18,365,930 |  |  | $ | 1,903,357 |  |  | $ | 10,457,180 |  |  | $ | 6,005,393 |
Financial liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Embedded derivative for equity-indexed contracts |  | $ | 872,746 |  |  | $ | — |  |  | $ | — |  |  | $ | 872,746 |
Separate account liabilities |  |  | 1,163,261 |  |  |  | 405,738 |  |  |  | 757,523 |  |  |  | — |
Total financial liabilities |  | $ | 2,036,007 |  |  | $ | 405,738 |  |  | $ | 757,523 |  |  | $ | 872,746 |

29

Note 9 – Fair Value of Financial Instruments – (Continued)

For financial instruments measured at fair value on a recurring basis using Level 3 inputs during the period, a reconciliation of the beginning and ending balances is shown below (in thousands):

|  | Level 3 |
|  | Three months ended March 31, 2024 |
|  | Assets |  |  | Liability |
|  | Investment Securities |  |  | Equity-Indexed Options |  |  | Separately Managed Accounts |  |  | Embedded Derivative |
Beginning Balance |  | $ | 5,674,051 |  |  | $ | 226,644 |  |  | $ | 104,698 |  |  | $ | 872,746 |
Net loss for derivatives and bonds included in net investment income |  |  | — |  |  |  | 56,542 |  |  |  | — |  |  |  | — |
Net change included in interest credited |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (37,541 | )
Net fair value change included in other comprehensive income |  |  | (692,791 | ) |  |  | — |  |  |  | (369 | ) |  |  | — |
Purchases, sales and settlements or maturities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Purchases |  |  | 2,039,038 |  |  |  | 35,178 |  |  |  | 5,290 |  |  |  | — |
Sales |  |  | (1,744,052 | ) |  |  | — |  |  |  | (3,823 | ) |  |  | — |
Settlements or maturities |  |  | — |  |  |  | (61,774 | ) |  |  | — |  |  |  | — |
Premiums less benefits |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 68,872 |
Ending balance at March 31, 2024 |  | $ | 5,276,246 |  |  | $ | 256,590 |  |  | $ | 105,796 |  |  | $ | 904,077 |

30

Note 9 – Fair Value of Financial Instruments – (Continued)

|  | Level 3 |
|  | Three Months Ended March 31, 2023 |
|  | Assets |  |  | Liability |
|  | Investment Securities |  |  | Equity-Indexed Options |  |  | Separately Managed Accounts |  |  | Embedded Derivative |
Beginning balance |  | $ | 3,039,806 |  |  | $ | 121,150 |  |  | $ | 127,291 |  |  | $ | 725,546 |
Net loss for derivatives included in net investment income |  |  | 85,505 |  |  |  | 24,648 |  |  |  | — |  |  |  | — |
Net change included in interest credited |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 50,683 |
Net fair value change included in other comprehensive income |  |  | — |  |  |  | — |  |  |  | (295 | ) |  |  | — |
Purchases, sales and settlements or maturities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Purchases |  |  | 1,404,527 |  |  |  | 30,427 |  |  |  | 9,156 |  |  |  | — |
Sales |  |  | (236,805 | ) |  |  | — |  |  |  | (8,955 | ) |  |  | — |
Settlements or maturities |  |  | (35 | ) |  |  | (9,450 | ) |  |  | — |  |  |  | — |
Premiums less benefits |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 8,002 |
Ending balance at March 31, 2023 |  | $ | 4,292,998 |  |  | $ | 166,775 |  |  | $ | 127,197 |  |  | $ | 784,231 |

There were no transfers between Level 1 and Level 2 fair value hierarchies during the periods presented. American National’s valuation of financial instruments categorized as Level 3 in the fair value hierarchy are based on valuation techniques that use significant inputs that are unobservable or had a decline in market activity that obscured observability. The indicators considered in determining whether a significant decrease in the volume and level of activity for a specific asset has occurred include the level of new issuances in the primary market, trading volume in the secondary market, the level of credit spreads over historical levels, applicable bid-ask spreads, and price consensus among market participants and other pricing sources. Level 3 assets and liabilities include financial instruments whose values are determined using pricing models and discounted cash flow methodology based on spread/yield assumptions.

Equity-index Options—Certain over the counter equity options are valued using models that are widely accepted in the financial services industry. These are categorized as Level 3 as a result of the significance of non-market observable inputs such as volatility and forward price/dividend assumptions. Other primary inputs include interest rate assumptions (risk-free rate assumptions), and underlying equity quoted index prices for identical or similar assets in markets that exhibit less liquidity relative to those markets.

31

Note 9 – Fair Value of Financial Instruments – (Continued)

The following summarizes the fair value (in thousands), valuation techniques and unobservable inputs of the Level 3 fair value measurements:

|  | Fair Value at March 31, 2024 |  | Valuation Technique |  | Unobservable Input |  | Range/Weighted Average |
Security type |  |  |  |  |  |  |  |  |  |  |
Investment securities |  |  |  |  |  |  |  |  |  |  |
Common stock |  | $ | 873 |  | Guideline public company method (1) |  |  |  |  | 0 |
|  |  |  |  | Current Value Method |  | LTM Revenue Multiple |  |  | .05X to 2.20x |
|  |  |  |  |  |  | Theatre Cash Flow Multiple |  |  | 5.5x |
Preferred stock |  |  | 4,522 |  | Guideline public company method (1) |  | LTM Revenue Multiple (4) |  |  | 2.20x to 3.5x |
|  |  |  |  | Market Approach-Precedent |  | Recurring Revenue Multiple |  |  | 5.50x |
|  |  |  |  | Transaction |  | Theatre Cash Flow Multiple |  |  | 5.50x |
|  |  |  |  | Current Value Method |  | Center EBITDA Multiple |  |  | 12.50x |
|  |  |  |  |  |  | LTM Adjustment EBITDA |  |  | 11.25x to 12.50x |
|  |  |  |  |  |  | PF Adjustment EBITDA Multiple |  |  | 8.00X to 10.50X |
Separately managed accounts |  | $ | 105,796 |  | Discounted cash flows (yield analysis) |  | Discount rate |  |  | 9.42%-29.75% |
|  |  |  |  | CVM |  | NFY EBITDA |  |  | 7.50xx |
|  |  |  |  | Market transaction |  | NFY +1 EBITDA |  |  | 5.50x |
|  |  |  |  | Recovery Waterfall |  | Theatre Cash Flow Multiple |  |  | 5.50x |
|  |  |  |  | Broker Quotes |  |  |  |  |  |
|  |  |  |  | Cost + Accrued |  |  |  |  |  |
|  |  |  |  | Guideline public company method (1) |  |  |  |  |  |
|  | Fair Value at December 31, 2023 |  | Valuation Technique |  | Unobservable Input |  | Range/Weighted Average |
Security type |  |  |  |  |  |  |  |  |  |  |
Investment securities |  |  |  |  |  |  |  |  |  |  |
Common stock |  | $ | 961 |  | Guideline public company method (1) |  | Recurring Revenue Multiple |  |  | 6.3x |
|  |  |  |  |  |  | LTM Revenue Multiple |  |  | 2.1x |
|  |  |  |  |  |  | NCY Cash Flow Multiple |  |  | 5.0x |
Preferred stock |  | $ | 4,771 |  | Guideline public company method (1) |  | LTM Revenue Multiple (2) |  |  | 4x |
|  |  |  |  |  |  | LTM EBITDA Multiple |  |  | 12.7x |
|  |  |  |  |  |  | NCY CF Multiple |  |  | 5x |
|  |  |  |  |  |  | Term (Years) |  |  | 1.1 |
|  |  |  |  |  |  | LTM EBITDA (est.) Multiple |  |  | 7.5x |
|  |  |  |  |  |  | NTM Adj. EBITDA Multiple |  |  | 9x |
|  |  |  |  |  |  | NCY Cash Flow Multiple |  |  | 5x |
|  |  |  |  |  |  | Option pricing method, Volatility |  |  | 73.6x |
Separately managed accounts |  | $ | 104,698 |  | Discounted cash flows (yield analysis) |  | Discount rate |  |  | 8.80-18.5% |
|  |  |  |  | CVM |  | NCY EBITDA |  |  | 0x |
|  |  |  |  | Market transaction |  |  |  |  | N/A |

| (1) | Guideline public company method uses price multiples from data on comparable public companies. Multiples are then adjusted to account for differences between what is being valued and comparable firms.

| (2) | LTM Revenue Multiple valuation metric shows revenue for the past 12 month period.

| (3) | Next Calendar Year (“NCY”) EBITDA Multiple is the forecasted EBITDA expected to be achieved over the next calendar year.

| (4) | NCY Revenue forecast revenue over the next calendar year.

| (5) | Last quarter annualized recurring revenue. Total recurring revenue realized during the previous quarter multiplied by 4.

Investment Securities—These bonds use cost as the best estimate of fair value. They are valued at cost because the value would not change unless there is a fundamental deterioration in the portfolio. There is no observable market valuation price or third-party sources that provide market values for these securities since they are not publicly traded. The common and preferred stock are valued at market transaction, option pricing method, or guideline public company method based on the best available information.

32

Note 9 – Fair Value of Financial Instruments – (Continued)

Separately Managed Accounts—The separately managed account manager uses the mid-point of a range from a third-party to price these securities. Discounted cash flows (yield analysis) and market transactions approach are used in the valuation. They use discount rate which is considered an unobservable input.

Fair Value Information About Financial Instruments Not Recorded at Fair Value

Information about fair value estimates for financial instruments not measured at fair value is discussed below:

Mortgage Loans—The fair value of mortgage loans is estimated using discounted cash flow analyses on a loan-by-loan basis by applying a discount rate to expected cash flows from future installment and balloon payments. The discount rate takes into account general market trends and specific credit risk trends for the individual loan. Factors used to arrive at the discount rate include inputs from spreads based on U.S. Treasury notes and the loan’s credit quality, region, property-type, lien priority, payment type and current status.

Policy Loans—The carrying value of policy loans is the outstanding balance plus any accrued interest. Due to the collateralized nature of policy loans such that they cannot be separated from the policy contracts, the unpredictable timing of repayments and the fact that settlement is at outstanding value, American National believes the carrying value of policy loans approximates fair value.

Investment Contracts—The carrying value of investment contracts is equivalent to the accrued account balance. The accrued account balance consists of deposits, net of withdrawals, net of interest credited, fees and charges assessed and other adjustments. American National believes that the carrying value of investment contracts approximates fair value because the majority of these contracts’ interest rates reset at anniversary.

Notes Payable—Notes payable are carried at outstanding principal balance. The carrying value of the notes payable approximates fair value because the underlying interest rates approximate market rates at the balance sheet date.

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Note 9 – Fair Value of Financial Instruments – (Continued)

The carrying value and estimated fair value of financial instruments not recorded at fair value on a recurring basis are shown below (in thousands):

|  | March 31, 2024
|  | FV Hierarchy Level |  | Carrying Amount |  | Fair Value |
Financial assets |  |  |  |  |  |  |  |  |
Mortgage loans on real estate, net of allowance |  | Level 3 |  | $ | 5,581,631 |  | $ | 5,290,171 |
Policy loans |  | Level 3 |  |  | 395,053 |  |  | 395,053 |
Total financial assets |  |  |  | $ | 5,976,684 |  | $ | 5,685,224 |
Financial liabilities |  |  |  |  |  |  |  |  |
Investment contracts |  | Level 3 |  | $ | 14,437,256 |  | $ | 14,437,256 |
Long-term debt |  | Level 3 |  |  | 1,493,636 |  |  | 1,397,000 |
Notes payable |  | Level 3 |  |  | 184,601 |  |  | 184,601 |
Total financial liabilities |  |  |  | $ | 16,115,493 |  | $ | 16,018,857 |
|  | December 31, 2023
|  | FV Hierarchy Level |  | Carrying Amount |  | Fair Value |
Financial assets |  |  |  |  |  |  |  |  |
Mortgage loans on real estate, net of allowance |  | Level 3 |  | $ | 5,658,023 |  | $ | 5,405,016 |
Policy loans |  | Level 3 |  |  | 390,393 |  |  | 390,393 |
Total financial assets |  |  |  | $ | 6,048,416 |  | $ | 5,795,409 |
Financial liabilities |  |  |  |  |  |  |  |  |
Investment contracts |  | Level 3 |  | $ | 14,096,714 |  | $ | 14,096,714 |
Long-term debt |  | Level 3 |  |  | 1,493,326 |  |  | 1,479,000 |
Notes payable |  | Level 3 |  |  | 174,017 |  |  | 174,017 |
Total financial liabilities |  |  |  | $ | 15,764,057 |  | $ | 15,749,731 |

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Note 10 – Deferred Policy Acquisition Costs and Value of Business Acquired

The changes in the asset for DAC and VOBA for the three months ended March 31, 2024 were as follows (in thousands):

|  | Life |  |  | Annuity |  |  | Health |  |  | Property & Casualty |  |  | Total |
Beginning balance at January 1, 2024 |  | $ | 519,153 |  |  | $ | 236,980 |  |  | $ | 10,292 |  |  | $ | 178,044 |  |  | $ | 944,469 |
Additions |  |  | 30,765 |  |  |  | 39,606 |  |  |  | 7,040 |  |  |  | 110,612 |  |  |  | 188,023 |
Amortization |  |  | (10,962 | ) |  |  | (5,955 | ) |  |  | (8,025 | ) |  |  | (135,816 | ) |  |  | (160,758 | )
Net change |  |  | 19,803 |  |  |  | 33,651 |  |  |  | (985 | ) |  |  | (25,204 | ) |  |  | 27,265 |
Ending balance at March 31, 2024 |  | $ | 538,956 |  |  | $ | 270,631 |  |  | $ | 9,307 |  |  | $ | 152,840 |  |  | $ | 971,734 |
|  | Life |  |  | Annuity |  |  | Health |  |  | Property & Casualty |  |  | Total |
Beginning balance at January 1, 2023 |  |  | 417,323 |  |  |  | 89,805 |  |  |  | 7,153 |  |  |  | 184,871 |  |  |  | 699,152 |
Additions |  |  | 145,012 |  |  |  | 165,727 |  |  |  | 8,575 |  |  |  | 450,642 |  |  |  | 769,956 |
Amortization |  |  | (43,182 | ) |  |  | (18,552 | ) |  |  | (5,436 | ) |  |  | (457,469 | ) |  |  | (524,639 | )
Net change |  |  | 101,830 |  |  |  | 147,175 |  |  |  | 3,139 |  |  |  | (6,827 | ) |  |  | 245,317 |
Ending balance at December 31, 2023 |  | $ | 519,153 |  |  | $ | 236,980 |  |  | $ | 10,292 |  |  | $ | 178,044 |  |  | $ | 944,469 |

Commissions comprise the majority of additions to deferred policy acquisition costs.

The following table provides the projected VOBA amortization expenses for a five-year period and thereafter (in thousands):

Years |  | Asset |
2024 |  | $ | 23,745 |
2025 |  |  | 29,183 |
2026 |  |  | 26,620 |
2027 |  |  | 24,317 |
2028 |  |  | 22,634 |
Thereafter |  |  | 229,454 |
Total amortization expense |  | $ | 355,953 |

The amortization of the VOBA asset is included in the change in deferred acquisition costs in the condensed consolidated statements of operations.

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Note 11 – Liability for Unpaid Claims and Claim Adjustment Expenses

The liability for unpaid claims and claim adjustment expenses (“claims”) for health and property and casualty insurance is included in “Policy and contract claims” in the condensed consolidated statements of financial position and is the amount estimated for incurred but not reported (“IBNR”) claims and claims that have been reported but not settled. The liability for unpaid claims is estimated based upon American National’s historical experience and actuarial assumptions that consider the effects of current developments, anticipated trends and risk management programs, less anticipated salvage and subrogation. The effects of the changes are included in the condensed consolidated results of operations in the period in which the changes occur. The time value of money is not taken into account for the purposes of calculating the liability for unpaid claims. There have been no significant changes in methodologies or assumptions used to calculate the liability for unpaid claims and claim adjustment expenses.

Information regarding the liability for unpaid claims is shown below (in thousands):

|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
Unpaid claims balance, beginning |  | $ | 1,656,894 |  |  | $ | 1,568,543 |
Less: Reinsurance recoverables |  |  | 301,590 |  |  |  | 305,327 |
Net beginning balance |  |  | 1,355,304 |  |  |  | 1,263,216 |
Incurred related to |  |  |  |  |  |  |  |
Current |  |  | 343,742 |  |  |  | 374,938 |
Prior years |  |  | (18,472 | ) |  |  | (10,424 | )
Total incurred claims |  |  | 325,270 |  |  |  | 364,514 |
Paid claims related to |  |  |  |  |  |  |  |
Current |  |  | 108,631 |  |  |  | 108,329 |
Prior years |  |  | 226,655 |  |  |  | 230,240 |
Total paid claims |  |  | 335,286 |  |  |  | 338,569 |
Net balance |  |  | 1,345,288 |  |  |  | 1,289,161 |
Plus: Reinsurance recoverables |  |  | 305,815 |  |  |  | 299,969 |
Unpaid claims balance, ending |  | $ | 1,651,103 |  |  | $ | 1,589,130 |

Estimates for ultimate incurred claims attributable to insured events of prior years’ decreased by approximately $18.4 million during the first three months of 2024 and decreased by $10.4 million during the same period in 2023. The favorable development in 2024 was a reflection of lower-than-anticipated losses arising from commercial other, business owners, and commercial auto lines of business. The favorable development in 2023 was a reflection of lower-than-anticipated settlement of losses arising from agribusiness, business owners, commercial automotive and commercial other lines of business.

For short-duration health insurance claims, the total of IBNR plus expected development on reported claims included in the liability for unpaid claims and claim adjustment expenses at March 31, 2024 and December 31, 2023 was $2.9 million and $4.2 million, respectively.

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Note 12 - Federal Income Taxes

A reconciliation of the effective tax rate to the statutory federal tax rate is shown below (in thousands, except percentages):

|  | QTD |
|  | Three months ended March 31, 2024 |  |  | Three months ended March 31, 2023 |
|  | Amount |  |  | Rate |  |  | Amount |  |  | Rate |
Total expected income tax expense at the statutory rate |  | $ | 29,594 |  |  |  | 21.0 | % |  | $ | 2,729 |  |  |  | 21.0 | %
Tax-exempt investment income |  |  | (518 | ) |  |  | (0.4 | ) |  |  | (798 | ) |  |  | (6.1 | )
Dividend exclusion |  |  | (258 | ) |  |  | (0.2 | ) |  |  | (599 | ) |  |  | (4.6 | )
Tax credits, net |  |  | (939 | ) |  |  | (0.7 | ) |  |  | (4,851 | ) |  |  | (37.3 | )
Low income housing tax credit expense |  |  | 670 |  |  |  | 0.5 |  |  |  | 717 |  |  |  | 5.5 |
Other items, net |  |  | 236 |  |  |  | 0.2 |  |  |  | 555 |  |  |  | 4.3 |
Total |  | $ | 28,785 |  |  |  | 20.4 | % |  | $ | (2,247 | ) |  |  | (17.2 | )%

American National is a party to a tax sharing agreement with its parent, BAMR US Holdings, LLC. In accordance with the agreement, if American National has taxable income, it pays its share of the consolidated federal income tax liability to its parent. However, if American National incurs a tax loss, the tax benefit is recovered by decreasing subsequent year’s federal income tax payments to its parent.

American National’s federal income tax returns for tax years 2020 to 2022 are subject to examination by the Internal Revenue Service. In the opinion of management, all prior year deficiencies have been paid or adequate provisions have been made for any tax deficiencies that may be upheld.

As of March 31, 2024, American National had no provision for uncertain tax positions and no provision for penalties or interest. In addition, management does not believe there are any uncertain tax benefits that could be recognized within the next twelve months that would impact American National’s effective tax rate.

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Note 13 – Accumulated Other Comprehensive Income (Loss)

The components of and changes in AOCI are shown below (in thousands) for the three months ended March 31, 2024 and 2023:

|  | Net Unrealized Losses on Securities |  |  | Defined Benefit Pension Plan Adjustments |  |  | Foreign Currency Adjustments |  |  | Change in Discount Rate Used to Measure LFPB |  |  | Change in Fair Value of Market Risk Benefits |  |  | Accumulated Other Comprehensive Income (Loss) |
Beginning balance at January 1, 2024 |  | $ | (298,891 | ) |  | $ | 85,860 |  |  | $ | (1,224 | ) |  | $ | 104,237 |  |  | $ | 821 |  |  | $ | (109,197 | )
Amounts reclassified from AOCI |  |  | 348 |  |  |  | 3,150 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 3,498 |
Unrealized losses arising during the period |  |  | (44,326 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (44,326 | )
Change in discount rates |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 102,308 |  |  |  | — |  |  |  | 102,308 |
Change in fair value market risk benefits |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (9,223 | ) |  |  | (9,223 | )
Foreign currency adjustment |  |  | — |  |  |  | — |  |  |  | (2,294 | ) |  |  | — |  |  |  | — |  |  |  | (2,294 | )
Ending balance March 31, 2024 |  | $ | (342,869 | ) |  | $ | 89,010 |  |  | $ | (3,518 | ) |  | $ | 206,545 |  |  | $ | (8,402 | ) |  | $ | (59,234 | )
|  | Net Unrealized Gains (Losses) on Securities |  |  | Defined Benefit Pension Plan Adjustments |  |  | Foreign Currency Adjustments |  |  | Change in Discount Rate Used to Measure LFPB |  |  | Change in Fair Value of Market Risk Benefits |  |  | Accumulated Other Comprehensive Income (Loss) |
Beginning balance at January 1, 2023 |  | $ | (721,536 | ) |  | $ | 1,161 |  |  | $ | (1,237 | ) |  | $ | 253,126 |  |  |  | 20,779 |  |  | $ | (447,707 | )
Amounts reclassified to from AOCI |  |  | 19,514 |  |  |  | 1,446 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 20,960 |
Unrealized gains arising during the period |  |  | 320,184 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 320,184 |
Unrealized gains (losses) on investments attributable to participating policyholders’ interest |  |  | (69 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (69 | )
Change in discount rates |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (105,674 | ) |  |  | — |  |  |  | (105,674 | )
Change in fair value market risk benefits |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (6,790 | ) |  |  | (6,790 | )
Foreign currency adjustment |  |  | — |  |  |  | — |  |  |  | 136 |  |  |  | — |  |  |  | — |  |  |  | 136 |
Ending balance at March 31, 2023 |  | $ | (381,907 | ) |  | $ | 2,607 |  |  | $ | (1,101 | ) |  | $ | 147,452 |  |  | $ | 13,989 |  |  | $ | (218,960 | )

Unrealized losses increased during the three months ended March 31, 2024 as a result of an increase in the benchmark ten-year interest rates.

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Note 14 – Equity and Noncontrolling Interests

As of March 31, 2024, there is one outstanding member unit, which is indirectly owned by Brookfield Reinsurance.

Statutory Capital and Surplus

Risk Based Capital (“RBC”) is a measure defined by the National Association of Insurance Commissioners (“NAIC”) and is used by insurance regulators to evaluate the capital adequacy of American National's insurance subsidiaries. RBC is calculated using formulas applied to certain financial balances and activities that consider, among other things, investment risks related to the type and quality of investments, insurance risks associated with products and liabilities, interest rate risks and general business risks. Insurance companies that do not maintain capital and surplus at a level at least 100% of the company action level RBC are required to take certain actions.

American National's insurance subsidiaries prepare financial statements in accordance with statutory accounting practices prescribed or permitted by the insurance department of each subsidiary's state of domicile, which include certain components of the National Association of Insurance Commissioners’ Codification of Statutory Accounting Principles (“NAIC Codification”). NAIC Codification is intended to standardize regulatory accounting and reporting to state insurance departments. However, statutory accounting practices continue to be established by individual state laws and permitted practices. Modifications by the various state insurance departments may impact the statutory capital and surplus of our insurance subsidiaries.

Statutory accounting differs from GAAP primarily by charging policy acquisition costs to expense as incurred, establishing future policy benefit liabilities using different actuarial assumptions, and valuing securities on a different basis. In addition, certain assets are not admitted under statutory accounting principles and are charged directly to surplus.

American National has been granted a permitted practice from the Texas Department of Insurance to recognize an admitted asset related to the notional value of coverage defined in an excess of loss reinsurance agreement. The permitted practice increases the statutory capital and surplus of American National by $548.2 million at March 31, 2024 and December 31, 2023. The statutory capital and surplus of American National would have remained above authorized control level RBC had it not used the permitted practice.

One of American National’s insurance subsidiaries has been granted a permitted practice from the Missouri Department of Insurance to record as the valuation of its investment in a wholly-owned subsidiary that is the attorney-in-fact for a Texas domiciled insurer, the statutory capital and surplus of the Texas domiciled insurer. This permitted practice increases the statutory capital and surplus of American National Property And Casualty Company ("ANPAC") by $66.6 million and $70.6 million at March 31, 2024 and December 31, 2023, respectively. The statutory capital and surplus of both ANPAC and American National Lloyds Insurance Company would have remained above the authorized control level RBC had it not used the permitted practice.

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Note 14 – Equity and Noncontrolling Interests - (Continued)

The statutory capital and surplus and net income (loss) of our life and property and casualty insurance entities in accordance with statutory accounting practices are shown below (in thousands):

|  | March 31, 2024 |  |  | December 31, 2023 |
Statutory capital and surplus |  |  |  |  |  |  |  |
Life insurance entities |  | $ | 2,710,988 |  |  | $ | 2,776,265 |
Property and casualty insurance entities |  |  | 1,716,020 |  |  |  | 1,701,884 |
|  | Three Months Ended March 31 |
|  | 2024 |  |  | 2023 |
Statutory net income (loss) |  |  |  |  |  |  |  |
Life insurance entities |  | $ | (65,021 | ) |  | $ | 16,012 |
Property and casualty insurance entities |  |  | 45,928 |  |  |  | (1,171 | )

Noncontrolling Interest

American National County Mutual Insurance Company (“County Mutual”) is a mutual insurance company owned by its policyholders. ANICO has a management agreement that effectively gives it control of County Mutual. As a result, County Mutual is included in the condensed consolidated financial statements of American National. Policyholder interests in the financial position of County Mutual are reflected as noncontrolling interest of $6.8 million at March 31, 2024 and December 31, 2023.

ANAT and its subsidiaries exercise control or ownership of various joint ventures, resulting in their consolidation into American National’s condensed consolidated financial statements. The interests of the other partners in the consolidated joint ventures are shown as a noncontrolling interest of $105.3 million and $100.7 million at March 31, 2024 and December 31, 2023, respectively.

Note 15 – Debt

As a result of the Merger on May 25, 2022, the Company assumed the Term Loan Agreement with a consortium of banks providing for five-year term loans in the aggregate principal amount of $1.5 billion maturing May 23, 2027. Interest is tied to Secured Overnight Financing Rate ("SOFR") and reset and paid quarterly. The all-in rate at the end of the third quarter was 6.278%. On June 13, 2022, the Company repaid $500 million under the Term Loan Agreement and at March 31, 2024 had $1.0 billion principal amount outstanding. The outstanding debt balance was reduced by $2.4 million in unamortized issuance costs as of March 31, 2024. Quarterly interest payments were $17.8 million and $64.8 million for three months ended March 31, 2024 and year ended December 31, 2023, respectively.

In June 2022, the Company issued $500 million of 6.144% unsecured Senior Notes maturing June 13, 2032. Interest is payable in arrears in June and December of each year. Such notes were offered under Rule 144A of the Securities Act of 1933, as amended. The proceeds from the Senior Notes were used to repay a portion of the Term Loan Agreement. The outstanding note balance was reduced by $4.0 million in unamortized issuance costs as of March 31, 2024. An interest payment of $15.4 million was made on December 13, 2023.

Note 16 – Commitments and Contingencies

Commitments

American National and its subsidiaries lease insurance sales office space, technological equipment, and automobiles. The remaining long-term lease commitments at March 31, 2024 were approximately $9.3 million.

American National had aggregate commitments at March 31, 2024 to purchase, expand or improve real estate, to fund fixed interest rate mortgage loans, and to purchase other invested assets of $1.6 billion, of which $1.1 billion is expected to be funded in 2024. The remaining $501.9 million will be funded in 2025 and beyond.

In addition, the Company had revolving commitments of $112.5 million expected to be funded during 2024.

American National had outstanding letters of credit in the amount of $3.5 million as of March 31, 2024 and December 31, 2023.

40

Federal Home Loan Bank ("FHLB") Agreements

The Company has access to the FHLB’s financial services including advances that provide an attractive funding source for short-term borrowing and for access to other funding agreements. As of March 31, 2024, certain municipal bonds and collateralized mortgage obligations with a fair value of approximately $6.3 million and commercial mortgage loans of approximately $898.6 million were on deposit with the FHLB as collateral for borrowing. As of March 31, 2024, the collateral provided borrowing capacity of approximately $615.0 million. The deposited securities and commercial mortgage loans are included in the Company’s condensed consolidated statements of financial position within fixed maturity securities and mortgage loans on real estate, net of allowance, respectively.

Litigation

American National and certain subsidiaries are defendants in various lawsuits concerning alleged breaches of contracts, various employment matters, allegedly deceptive insurance sales and marketing practices, and miscellaneous other causes of action arising in the ordinary course of operations. Certain of these lawsuits include claims for compensatory and punitive damages. We provide accruals for these items to the extent we deem the losses probable and reasonably estimable. After reviewing these matters with legal counsel, based upon information presently available, management is of the opinion that the ultimate resultant liability, if any, would not have a material adverse effect on American National’s condensed consolidated financial position, liquidity or results of operations; however, assessing the eventual outcome of litigation necessarily involves forward-looking speculation as to judgments to be made by judges, juries and appellate courts in the future.

Such speculation warrants caution, as the frequency of large damage awards, which bear little or no relation to the economic damages incurred by plaintiffs in some jurisdictions, continues to create the potential for an unpredictable judgment in any given lawsuit. These lawsuits are in various stages of development, and future facts and circumstances could result in management changing its conclusions. It is possible that, if the defenses in these lawsuits are not successful, and the judgments are greater than management can anticipate, the resulting liability could have a material impact on our condensed consolidated financial position, liquidity, or results of operations. With respect to the existing litigation, management currently believes that the possibility of a material judgment adverse to American National is remote. Accruals for losses are established whenever they are probable and reasonably estimable. If no one estimate within the range of possible losses is more probable than any other, an accrual is recorded based on the lowest amount of the range.

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Note 17 – Related Party Transactions

American National has entered into recurring transactions and agreements with certain related parties. Prior to the Merger, these included mortgage loans, management contracts, agency commission contracts, marketing agreements, health insurance contracts, and legal services. The impact on the condensed consolidated financial statements of significant related party transactions is discussed below.

In 2024, the Company purchased related party investments totaling $52.7 million, composed of $52.4 million in collateral loans, $0.2 million in bonds, $0.1 million in common stock and other various investment classes. In 2023, the Company purchased $4.0 billion in related party investments, composed of $2.2 billion in collateral loans, $1.3 billion in bonds, $492.7 million in common stock and other various investment classes. Investment transactions with related parties are accounted for in the same manner as those with unrelated parties in the financial statements.

For the three months ended March 31, 2024 the Company paid investment management fees due to related party arrangements of $12.0 million. For the three months ended March 31, 2023 the Company paid investment management fees of $10.1 million.

On November 8, 2022 ANAT and BAMR US Holdings LLC entered into a deposit agreement. The balance at March 31, 2024 was $269.3 million. The deposit is considered a cash and cash equivalent in the Company's condensed consolidated statements of financial position as of March 31, 2024.

On August 17, 2023 ANTAC, LLC (a subsidiary of ANAT) and BAMR US Holdings LLC entered into a deposit agreement. The balance at March 31, 2024 was $183.4 million. The deposit is considered a cash and cash equivalent in the Company's consolidated statements of financial position as of March 31, 2024.

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Note 18 – Liability for Future Policy Benefits

The balances and changes in the liability for future policy benefits for the three months ended March 31, 2024 are as follows (in thousands):

|  | March 31, 2024 |
|  | Term Life |  |  | Whole Life |  |  | Annuity |  |  | Health |
Present value of Expected Net Premiums: |  |  |  |  |  |  |  |  |  |  |  |
Balance, beginning of period |  | $ | 1,859,631 |  |  | $ | 1,285,037 |  |  | $ | — |  |  | $ | 223,221 |
Beginning balance at original discount rate |  |  | 1,934,392 |  |  |  | 1,319,100 |  |  |  | — |  |  |  | 265,647 |
Effect of changes in cash flow assumptions |  |  | 62,489 |  |  |  | (52 | ) |  |  | — |  |  |  | 12,933 |
Effect of actual variances from expected experience |  |  | (25,899 | ) |  |  | 11,094 |  |  |  | 2,262 |  |  |  | 8,741 |
Adjusted beginning of period balance |  |  | 1,970,982 |  |  |  | 1,330,142 |  |  |  | 2,262 |  |  |  | 287,321 |
Net issuances (lapses) |  |  | 2,824 |  |  |  | 14,702 |  |  |  | 555,503 |  |  |  | (23,255 | )
Interest accrual |  |  | 19,621 |  |  |  | 13,321 |  |  |  | 3,842 |  |  |  | 2,905 |
Net premiums collected |  |  | (35,815 | ) |  |  | (49,373 | ) |  |  | (561,607 | ) |  |  | (21,118 | )
Ending balance at original discount rate |  |  | 1,957,612 |  |  |  | 1,308,792 |  |  |  | — |  |  |  | 245,853 |
Effect of changes in discount rate assumptions |  |  | 47,686 |  |  |  | 21,967 |  |  |  | — |  |  |  | (9,882 | )
Balance, end of period |  | $ | 2,005,298 |  |  | $ | 1,330,759 |  |  | $ | — |  |  | $ | 235,971 |
Present value of Expected Future Policy Benefits: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance, beginning of year |  | $ | 2,443,712 |  |  | $ | 2,596,364 |  |  | $ | 2,212,885 |  |  | $ | 256,684 |
Beginning balance at original discount rate |  |  | 2,543,438 |  |  |  | 2,733,557 |  |  |  | 2,214,701 |  |  |  | 312,264 |
Effect of changes in cash flow assumptions |  |  | 73,570 |  |  |  | 17 |  |  |  | 296 |  |  |  | 13,286 |
Effect of actual variances from expected experience |  |  | (25,390 | ) |  |  | 11,324 |  |  |  | 3,993 |  |  |  | 3,698 |
Adjusted beginning of period balance |  |  | 2,591,618 |  |  |  | 2,744,898 |  |  |  | 2,218,990 |  |  |  | 329,248 |
Net issuances (lapses) |  |  | 2,824 |  |  |  | 14,699 |  |  |  | 566,796 |  |  |  | (23,809 | )
Interest accrual |  |  | 25,828 |  |  |  | 27,383 |  |  |  | 32,284 |  |  |  | 3,462 |
Benefit payments |  |  | (29,243 | ) |  |  | (50,905 | ) |  |  | (58,537 | ) |  |  | (14,359 | )
Ending balance at original discount rate |  |  | 2,591,027 |  |  |  | 2,736,075 |  |  |  | 2,759,533 |  |  |  | 294,542 |
Effect of changes in discount rate assumptions |  |  | 78,180 |  |  |  | 75,100 |  |  |  | 18,699 |  |  |  | (14,906 | )
Balance, end of period |  |  | 2,669,207 |  |  |  | 2,811,175 |  |  |  | 2,778,232 |  |  |  | 279,636 |
Gross liability for future policy benefits |  |  | 663,909 |  |  |  | 1,480,416 |  |  |  | 2,778,232 |  |  |  | 43,665 |
Impact of flooring |  |  | 292 |  |  |  | — |  |  |  | — |  |  |  | 4 |
Net liability for future policy benefits |  |  | 664,201 |  |  |  | 1,480,416 |  |  |  | 2,778,232 |  |  |  | 43,669 |
Less: Reinsurance recoverable |  |  | (48,380 | ) |  |  | — |  |  |  | — |  |  |  | (16,427 | )
Net liability for future policy benefits, after reinsurance recoverable |  | $ | 615,821 |  |  | $ | 1,480,416 |  |  | $ | 2,778,232 |  |  | $ | 27,242 |
Weighted-average liability duration of the liability |  |  | 13.4 |  |  |  | 17.0 |  |  |  | 4.7 |  |  |  | 6.0 |
Undiscounted expected future benefit payments |  | $ | 4,705 |  |  | $ | 5,706 |  |  | $ | 4,422 |  |  | $ | 418 |
Undiscounted expected gross premiums |  | $ | 4,658 |  |  | $ | 2,712 |  |  | $ | 1,519 |  |  | $ | 472 |
Gross premiums recognized in statement of operations |  | $ | 45,674 |  |  | $ | 67,208 |  |  | $ | 564,846 |  |  | $ | 29,066 |
Interest expense recognized in statement of operations |  | $ | 6,207 |  |  | $ | 14,062 |  |  | $ | 28,442 |  |  | $ | 557 |
Interest accretion rate |  |  | 4.7 | % |  |  | 4.5 | % |  |  | 5.0 | % |  |  | 3.7 | %
Current discount rate |  |  | 4.4 | % |  |  | 4.3 | % |  |  | 4.9 | % |  |  | 4.4 | %

43

Note 18 – Liability for Future Policy Benefits – (Continued)

|  | December 31, 2023 |
|  | Term Life |  |  | Whole Life |  |  | Annuity |  |  | Health |
Present value of Expected Net Premiums: |  |  |  |  |  |
Balance, January 1, 2023 |  | $ | 2,181,520 |  |  | $ | 1,338,304 |  |  | $ | — |  |  | $ | 254,452 |
Beginning balance at original discount rate |  |  | 2,400,114 |  |  |  | 1,425,419 |  |  |  | — |  |  |  | 262,239 |
Effect of changes in cash flow assumptions |  |  | (348,834 | ) |  |  | (3,650 | ) |  |  | — |  |  |  | 35,898 |
Effect of actual variances from expected experience |  |  | (84,388 | ) |  |  | 25,538 |  |  |  | 1,684 |  |  |  | (1,438 | )
Adjusted beginning of period balance |  |  | 1,966,892 |  |  |  | 1,447,307 |  |  |  | 1,684 |  |  |  | 296,699 |
Net issuances (lapses) |  |  | 38,600 |  |  |  | 53,299 |  |  |  | 985,147 |  |  |  | (36,816 | )
Interest accrual |  |  | 75,049 |  |  |  | 45,982 |  |  |  | 7,820 |  |  |  | 9,819 |
Net premiums collected |  |  | (146,150 | ) |  |  | (227,487 | ) |  |  | (994,651 | ) |  |  | (36,461 | )
Ending balance at original discount rate |  |  | 1,934,391 |  |  |  | 1,319,101 |  |  |  | — |  |  |  | 233,241 |
Effect of changes in discount rate assumptions |  |  | (74,760 | ) |  |  | (34,064 | ) |  |  | — |  |  |  | (10,020 | )
Balance, December 31, 2023 |  | $ | 1,859,631 |  |  | $ | 1,285,037 |  |  | $ | — |  |  | $ | 223,221 |
Present value of Expected Future Policy Benefits: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance, January 1, 2023 |  | $ | 2,694,329 |  |  | $ | 2,635,785 |  |  | $ | 1,288,034 |  |  | $ | 292,528 |
Beginning balance at original discount rate |  |  | 2,960,617 |  |  |  | 2,914,365 |  |  |  | 1,368,141 |  |  |  | 303,469 |
Effect of changes in cash flow assumptions |  |  | (357,635 | ) |  |  | (4,505 | ) |  |  | (1,282 | ) |  |  | 40,453 |
Effect of actual variances from expected experience |  |  | (84,356 | ) |  |  | 25,742 |  |  |  | (25,118 | ) |  |  | 1,619 |
Adjusted beginning of period balance |  |  | 2,518,626 |  |  |  | 2,935,602 |  |  |  | 1,341,741 |  |  |  | 345,541 |
Net issuances (lapses) |  |  | 38,485 |  |  |  | 53,282 |  |  |  | 990,191 |  |  |  | (37,202 | )
Interest accrual |  |  | 94,482 |  |  |  | 93,533 |  |  |  | 73,322 |  |  |  | 11,682 |
Benefit payments |  |  | (108,155 | ) |  |  | (348,860 | ) |  |  | (188,599 | ) |  |  | (39,514 | )
Ending balance at original discount rate |  |  | 2,543,438 |  |  |  | 2,733,557 |  |  |  | 2,216,655 |  |  |  | 280,507 |
Effect of changes in discount rate assumptions |  |  | (99,726 | ) |  |  | (137,193 | ) |  |  | (3,770 | ) |  |  | (14,823 | )
Balance, December 31, 2023 |  |  | 2,443,712 |  |  |  | 2,596,364 |  |  |  | 2,212,885 |  |  |  | 265,684 |
Gross liability for future policy benefits |  |  | 584,081 |  |  |  | 1,311,327 |  |  |  | 2,212,885 |  |  |  | 42,463 |
Net liability for future policy benefits |  |  | 584,081 |  |  |  | 1,311,327 |  |  |  | 2,212,885 |  |  |  | 42,463 |
Less: Reinsurance recoverable |  |  | (44,995 | ) |  |  | — |  |  |  | — |  |  |  | (14,581 | )
Net liability for future policy benefits, after reinsurance recoverable |  | $ | 539,086 |  |  | $ | 1,311,327 |  |  | $ | 2,212,885 |  |  | $ | 27,882 |
Weighted-average liability duration of the liability |  |  | 13.9 |  |  |  | 17.1 |  |  |  | 8.0 |  |  |  | 6.0 |
Undiscounted expected future benefit payments |  | $ | 4,659 |  |  | $ | 5,694 |  |  | $ | 3,466 |  |  | $ | 403 |
Undiscounted expected gross premiums |  | $ | 4,834 |  |  | $ | 2,707 |  |  | $ | — |  |  | $ | 470 |
Gross premiums recognized in statement of operations |  | $ | 188,897 |  |  | $ | 263,133 |  |  | $ | 1,027,430 |  |  | $ | 154,593 |
Interest expense recognized in statement of operations |  | $ | 26,821 |  |  | $ | 68,015 |  |  | $ | 83,470 |  |  | $ | 4,281 |
Interest accretion rate |  |  | 4.8 | % |  |  | 4.5 | % |  |  | 4.9 | % |  |  | 3.8 | %
Current discount rate |  |  | 5.1 | % |  |  | 5.0 | % |  |  | 4.9 | % |  |  | 4.5 | %

44

Note 18 – Liability for Future Policy Benefits – (Continued)

The reconciliation of liability for future policy benefits in the condensed consolidated statement of financial position are as follows (in thousands):

|  | March 31, 2024 |  |  | December 31, 2023 |
Term life |  | $ | 663,909 |  |  | $ | 584,081 |
Whole life |  |  | 1,480,416 |  |  |  | 1,311,327 |
Annuity |  |  | 2,778,233 |  |  |  | 2,212,885 |
Health |  |  | 43,665 |  |  |  | 42,463 |
Deferred profit liability |  |  | 138,976 |  |  |  | 129,754 |
VOBA |  |  | 870,287 |  |  |  | 884,291 |
Liability for future policy benefits not subject to LDTI |  |  | 708,686 |  |  |  | 943,158 |
Total |  | $ | 6,684,172 |  |  | $ | 6,107,959 |

Note 19 – Policyholder Account Balances

Policyholder account balances relate to investment-type contracts and universal life-type policies. Investment-type contracts principally include traditional individual fixed annuities in the accumulation phase and non-variable group annuity contracts. Policyholder account balances are equal to (i) policy account values, which consist of an accumulation of gross premium payments; (ii) credited interest, ranging from 1.0% to 8.0% (some annuities have enhanced first year crediting rates ranging from 1.0%to7.0%), less expenses, mortality charges, and withdrawals; and (iii) fair value adjustment.

The balances and changes in policyholders' account balances for the three months ended March 31, 2024 were as follows (in thousands):

|  | March 31, 2024 |
|  | Universal Life |  |  | Equity Indexed Universal Life |  |  | Fixed Deferred Annuity |  |  | Equity Indexed Annuity |
Balance, beginning of period |  | $ | 1,257,799 |  |  | $ | 750,391 |  |  | $ | 10,105,078 |  |  | $ | 4,723,818 |
Issuances |  |  | 8,124 |  |  |  | 10,649 |  |  |  | 730,286 |  |  |  | 96,734 |
Premiums received |  |  | 69,489 |  |  |  | 37,879 |  |  |  | 2,557 |  |  |  | 1,677 |
Policy charges |  |  | (70,470 | ) |  |  | (24,986 | ) |  |  | (1,037 | ) |  |  | (10,475 | )
Surrenders and withdrawals |  |  | (16,163 | ) |  |  | (6,920 | ) |  |  | (441,763 | ) |  |  | (171,637 | )
Interest credited |  |  | 9,276 |  |  |  | 22,697 |  |  |  | 98,778 |  |  |  | 61,864 |
Balance, end of period |  | $ | 1,258,055 |  |  | $ | 789,710 |  |  | $ | 10,493,899 |  |  | $ | 4,701,981 |
Weighted-average crediting rate |  |  | 0.7 | % |  |  | 2.9 | % |  |  | 1.0 | % |  |  | 1.3 | %
Net amount at risk |  | $ | 21,628,368 |  |  | $ | 16,520,099 |  |  | $ | — |  |  | $ | 405,451 |
Cash surrender value |  | $ | 1,121,604 |  |  | $ | 631,857 |  |  | $ | 9,951,640 |  |  | $ | 4,093,363 |

45

Note 19 – Policyholder Account Balances - (Continued)

|  | December 31, 2023 |
|  | Universal Life |  |  | Equity Indexed Universal Life |  |  | Fixed Deferred Annuity |  |  | Equity Indexed Annuity |
Balance, beginning of period |  | $ | 1,286,762 |  |  | $ | 613,661 |  |  | $ | 7,295,531 |  |  | $ | 4,745,678 |
Issuances |  |  | 37,320 |  |  |  | 46,747 |  |  |  | 3,988,887 |  |  |  | 392,978 |
Premiums received |  |  | 254,619 |  |  |  | 144,252 |  |  |  | 23,669 |  |  |  | 10,264 |
Policy charges |  |  | (266,948 | ) |  |  | (94,736 | ) |  |  | (6,317 | ) |  |  | (33,051 | )
Surrenders and withdrawals |  |  | (89,114 | ) |  |  | (21,305 | ) |  |  | (1,500,934 | ) |  |  | (631,085 | )
Interest credited |  |  | 35,160 |  |  |  | 61,772 |  |  |  | 304,242 |  |  |  | 239,034 |
Balance, end of period |  | $ | 1,257,799 |  |  | $ | 750,391 |  |  | $ | 10,105,078 |  |  | $ | 4,723,818 |
Weighted-average crediting rate |  |  | 2.7 | % |  |  | 9.1 | % |  |  | 3.5 | % |  |  | 5.1 | %
Net amount at risk |  | $ | 21,585,998 |  |  | $ | 16,354,794 |  |  | $ | — |  |  | $ | 392,017 |
Cash surrender value |  | $ | 1,122,202 |  |  | $ | 594,772 |  |  | $ | 9,593,887 |  |  | $ | 4,088,713 |

The reconciliation of policyholders’ account balances to the policyholders’ account balances’ liability in the condensed consolidated statement of financial position are shown below (in thousands):

|  | March 31, 2024 |  |  | December 31, 2023 |
Universal life |  | $ | 1,258,055 |  |  | $ | 1,257,799 |
Equity indexed universal life |  |  | 789,710 |  |  |  | 750,391 |
Fixed deferred annuity |  |  | 10,493,899 |  |  |  | 10,105,078 |
Equity indexed annuity |  |  | 4,701,981 |  |  |  | 4,723,818 |
Single premium immediate annuity |  |  | 296,319 |  |  |  | 291,146 |
Variable universal life |  |  | 35,898 |  |  |  | 36,419 |
Variable deferred annuity |  |  | 8,202 |  |  |  | 8,469 |
Pension |  |  | 4,382 |  |  |  | — |
Total |  | $ | 17,588,446 |  |  | $ | 17,177,476 |

46

Note 19 – Policyholder Account Balances - (Continued)

The balance of 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 are shown below (in thousands):

|  |  |  | March 31, 2024 |
|  | Range of Guaranteed Minimum Crediting Rate |  | At Guaranteed Minimum |  |  | 1 - 50 Basis Points Above |  |  | 51 - 150 Basis Points Above |  |  | > 150 Basis Points Above |  |  | Total |
Universal Life |  | 0.00%-1.00% |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
|  | 1.00%-2.00% |  |  | 25,708 |  |  |  | 2,016 |  |  |  | 10,875 |  |  |  | — |  |  |  | 38,599 |
|  | 2.00%-3.00% |  |  | 417,796 |  |  |  | — |  |  |  | 147,284 |  |  |  | — |  |  |  | 565,080 |
|  | Greater than 3.00% |  |  | 654,376 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 654,376 |
|  | Total |  | $ | 1,097,880 |  |  | $ | 2,016 |  |  | $ | 158,159 |  |  | $ | — |  |  | $ | 1,258,055 |
Equity Indexed Universal Life |  | 0.00%-1.00% |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
|  | 1.00%-2.00% |  |  | — |  |  |  | — |  |  |  | 134,848 |  |  |  | 583,028 |  |  |  | 717,876 |
|  | 2.00%-3.00% |  |  | — |  |  |  | — |  |  |  | 71,834 |  |  |  | — |  |  |  | 71,834 |
|  | Greater than 3.00% |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
|  | Total |  | $ | — |  |  | $ | — |  |  | $ | 206,682 |  |  | $ | 583,028 |  |  | $ | 789,710 |
Fixed Deferred Annuity |  | 0.00%-1.00% |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
|  | 1.00%-2.00% |  |  | 276,850 |  |  |  | 340,291 |  |  |  | 1,773,602 |  |  |  | 1,856,757 |  |  |  | 4,247,500 |
|  | 2.00%-3.00% |  |  | 710,418 |  |  |  | 363,960 |  |  |  | 60,322 |  |  |  | 4,834,263 |  |  |  | 5,968,963 |
|  | Greater than 3.00% |  |  | 267,151 |  |  |  | 6,596 |  |  |  | 1,141 |  |  |  | 2,548 |  |  |  | 277,436 |
|  | Total |  | $ | 1,254,419 |  |  | $ | 710,847 |  |  | $ | 1,835,065 |  |  | $ | 6,693,568 |  |  | $ | 10,493,899 |
Equity Indexed Annuity |  | 0.00%-1.00% |  | $ | 2,246,307 |  |  | $ | 55,554 |  |  | $ | 487,235 |  |  | $ | 916,472 |  |  | $ | 3,705,568 |
|  | 1.00%-2.00% |  |  | 358,919 |  |  |  | 42,568 |  |  |  | 139,326 |  |  |  | 145,585 |  |  |  | 686,398 |
|  | 2.00%-3.00% |  |  | 147,607 |  |  |  | 10,481 |  |  |  | 29,809 |  |  |  | 122,118 |  |  |  | 310,015 |
|  | Greater than 3.00% |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
|  | Total |  | $ | 2,752,833 |  |  | $ | 108,603 |  |  | $ | 656,370 |  |  | $ | 1,184,175 |  |  | $ | 4,701,981 |

47

|  |  |  | December 31, 2023 |
|  | Range of Guaranteed Minimum Crediting Rate |  | At Guaranteed Minimum |  |  | 1 - 50 Basis Points Above |  |  | 51 - 150 Basis Points Above |  |  | > 150 Basis Points Above |  |  | Total |
Universal Life |  | 0.00%-1.00% |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
|  | 1.00%-2.00% |  |  | 22,077 |  |  |  | 2,042 |  |  |  | 11,445 |  |  |  | — |  |  |  | 35,564 |
|  | 2.00%-3.00% |  |  | 414,979 |  |  |  | — |  |  |  | 148,086 |  |  |  | — |  |  |  | 563,065 |
|  | Greater than 3.00% |  |  | 659,170 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 659,170 |
|  | Total |  | $ | 1,096,226 |  |  | $ | 2,042 |  |  | $ | 159,531 |  |  | $ | — |  |  | $ | 1,257,799 |
Equity Indexed Universal Life |  | 0.00%-1.00% |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
|  | 1.00%-2.00% |  |  | 153,554 |  |  |  | — |  |  |  | 133,834 |  |  |  | 391,830 |  |  |  | 679,218 |
|  | 2.00%-3.00% |  |  | — |  |  |  | — |  |  |  | 71,173 |  |  |  | — |  |  |  | 71,173 |
|  | Greater than 3.00% |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
|  | Total |  | $ | 153,554 |  |  | $ | — |  |  | $ | 205,007 |  |  | $ | 391,830 |  |  | $ | 750,391 |
Fixed Deferred Annuity |  | 0.00%-1.00% |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
|  | 1.00%-2.00% |  |  | 302,924 |  |  |  | 382,126 |  |  |  | 1,804,089 |  |  |  | 2,055,022 |  |  |  | 4,544,161 |
|  | 2.00%-3.00% |  |  | 746,465 |  |  |  | 398,243 |  |  |  | 46,630 |  |  |  | 4,088,400 |  |  |  | 5,279,738 |
|  | Greater than 3.00% |  |  | 272,563 |  |  |  | 6,520 |  |  |  | 891 |  |  |  | 1,205 |  |  |  | 281,179 |
|  | Total |  | $ | 1,321,952 |  |  | $ | 786,889 |  |  | $ | 1,851,610 |  |  | $ | 6,144,627 |  |  | $ | 10,105,078 |
Equity Indexed Annuity |  | 0.00%-1.00% |  | $ | 2,584,504 |  |  | $ | 30,135 |  |  | $ | 487,196 |  |  | $ | 726,897 |  |  | $ | 3,828,732 |
|  | 1.00%-2.00% |  |  | 381,269 |  |  |  | 48,009 |  |  |  | 140,382 |  |  |  | 82,936 |  |  |  | 652,596 |
|  | 2.00%-3.00% |  |  | 85,543 |  |  |  | 11,398 |  |  |  | 9,286 |  |  |  | 136,263 |  |  |  | 242,490 |
|  | Greater than 3.00% |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
|  | Total |  | $ | 3,051,316 |  |  | $ | 89,542 |  |  | $ | 636,864 |  |  | $ | 946,096 |  |  | $ | 4,723,818 |

48

Note 20 - Market Risk Benefits

American National classifies the Lifetime Income Rider ("LIR") as an MRB. The LIR is a rider offering guaranteed minimum withdrawal benefits available on certain fixed indexed annuity products.

The balances of and changes in guaranteed minimum withdrawal benefits associated with annuity contracts follow (in thousands).

|  | March 31, 2024 |  |  | December 31, 2023 |
|  | Annuity |  |  | Annuity |
Balance, beginning of period |  | $ | (86 | ) |  | $ | 44,010 |
Balance, beginning of period, before effect of changes in the instrument-specific credit risk |  |  | (86 | ) |  |  | 44,010 |
Effect of changes in the beginning instrument-specific credit risk |  |  | 1,040 |  |  |  | 26,303 |
Effect of model refinements |  |  | — |  |  |  | (13,050 | )
Effect of non-financial assumption update |  |  | 162 |  |  |  | — |
Attributed fees collected |  |  | 3,873 |  |  |  | 13,175 |
Interest accrual |  |  | 37 |  |  |  | 3,067 |
Adjustment from deterministic to stochastic |  |  | 5,033 |  |  |  | 18,972 |
Effect of experience variance |  |  | (3,150 | ) |  |  | (13,051 | )
Effect of changes in financial assumptions |  |  | 13,283 |  |  |  | (79,779 | )
Issuance |  |  | (186 | ) |  |  | 1,307 |
Balance, end of period, before effect of changes in nonperformance risk |  |  | 20,006 |  |  |  | 954 |
Effect of changes in the ending instrument-specific credit risk |  |  | 10,635 |  |  |  | (1,040 | )
Balance, end of period |  |  | 30,641 |  |  |  | (86 | )
Balance, end of period, net of reinsurance |  | $ | 30,641 |  |  | $ | (86 | )
|  | March 31, 2024 |  |  | December 31, 2023 |
|  | Annuity |  |  | Annuity |
Weighted-average attained age of contract holders amounted |  | $ | 65 |  |  |  | 65 |

The reconciliation of market risk benefits by amounts in an asset position and in a liability position to the market risk benefits amount in the condensed consolidated statement of financial position follows (in thousands).

|  | March 31, 2024 |
|  | Asset |  |  | Liability |  |  | Net |
Annuity |  | $ | 24,725 |  |  | $ | 55,366 |  |  | $ | 30,641 |
|  | December 31, 2023 |
|  | Asset |  |  | Liability |  |  | Net |
Annuity |  | $ | 33,658 |  |  | $ | 33,572 |  |  | $ | (86 | )

49

Note 21 – Segment Information

Management organizes the business into four operating segments:

| · | Life—consists of whole, term, universal, indexed and variable life insurance. Products are primarily sold through career, multiple-line, and independent agents as well as direct marketing channels.

| · | Annuity—consists of fixed, indexed, and variable annuity products. Products are primarily sold through independent agents, brokers, and financial institutions, along with multiple-line and career agents.

| · | Property and Casualty—consists of personal, agricultural and targeted commercial coverages and credit-related property insurance. Products are primarily sold through multiple-line and independent agents or managing general agents. There are also small amounts of Health insurance, consisting of Medicare Supplement, stop-loss, other supplemental health products and credit disability insurance. Products are typically distributed through independent agents and managing general underwriters.

| · | Corporate and Other—consists of net investment income from investments and certain expenses not allocated to the insurance segments and revenues and related expenses from non-insurance operations.

All revenues and expenses specifically attributable to policy transactions are recorded directly to the appropriate operating segment. Revenues and expenses not specifically attributable to policy transactions are allocated to each segment as follows:

| · | Recurring income from bonds and mortgage loans is allocated based on the assets allocated to each segment at the average yield available from these assets.

| · | Net investment income from all other assets is allocated to the insurance segments in accordance with the amount of capital allocated to each segment, with the remainder recorded in the Corporate and Other segment.

| · | Expenses are charged to segments through direct identification and allocations based upon various factors.

The results of operations measured as the income before federal income taxes and other items by operating segments are summarized below (in thousands):

|  | Three months ended March 31, 2024 |
|  | Life |  |  | Annuity |  |  | Property and Casualty |  |  | Corporate and Other |  |  | Total |
PREMIUMS AND OTHER REVENUES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Premiums |  | $ | 102,433 |  |  | $ | 564,231 |  |  | $ | 477,072 |  |  | $ | — |  |  | $ | 1,143,736 |
Other policy revenues |  |  | 97,803 |  |  |  | 14,608 |  |  |  | — |  |  |  | — |  |  |  | 112,411 |
Net investment income |  |  | 105,154 |  |  |  | 277,766 |  |  |  | 48,609 |  |  |  | 38,690 |  |  |  | 470,219 |
Net realized investment gains |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 2,295 |  |  |  | 2,295 |
Decrease in investment credit loss |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,309 |  |  |  | 1,309 |
Net gains on equity securities |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (10,811 | ) |  |  | (10,811 | )
Other income |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 7,630 |  |  |  | 7,630 |
Total premiums and other revenues |  | $ | 305,390 |  |  | $ | 856,605 |  |  | $ | 525,681 |  |  | $ | 39,113 |  |  | $ | 1,726,789 |
BENEFITS, LOSSES AND EXPENSES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Policyholder benefits and claims incurred |  | $ | (137,714 | ) |  | $ | (625,668 | ) |  | $ | (320,317 | ) |  | $ | — |  |  | $ | (1,083,699 | )
Change in fair value of market risk benefits |  |  | — |  |  |  | (19,052 | ) |  |  | — |  |  |  | — |  |  |  | (19,052 | )
Interest credited to policyholders' account balances |  |  | (32,602 | ) |  |  | (159,622 | ) |  |  | — |  |  |  | — |  |  |  | (192,224 | )
Future policy benefit remeasurement losses |  |  | (26,419 | ) |  |  | 24,710 |  |  |  | 31 |  |  |  | — |  |  |  | (1,678 | )
Other operating expenses |  |  | (65,664 | ) |  |  | (27,589 | ) |  |  | (13,934 | ) |  |  | (21,266 | ) |  |  | (128,453 | )
Amortization of deferred policy acquisition costs |  |  | (10,962 | ) |  |  | (6,154 | ) |  |  | (143,642 | ) |  |  | — |  |  |  | (160,758 | )
Total benefits, losses and expenses |  | $ | (273,361 | ) |  | $ | (813,375 | ) |  | $ | (477,862 | ) |  | $ | (21,266 | ) |  | $ | (1,585,864 | )
Income before federal income tax and other items |  | $ | 32,029 |  |  | $ | 43,230 |  |  | $ | 47,819 |  |  | $ | 17,847 |  |  | $ | 140,925 |

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|  | Three months ended March 31, 2023 |
|  | Life |  |  | Annuity |  |  | Property and Casualty |  |  | Corporate and Other |  |  | Total |
PREMIUMS AND OTHER REVENUES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Premiums |  | $ | 109,998 |  |  | $ | 159,656 |  |  | $ | 510,737 |  |  | $ | — |  |  | $ | 780,391 |
Other policy revenues |  |  | 89,926 |  |  |  | 6,653 |  |  |  | — |  |  |  | — |  |  |  | 96,579 |
Net investment income |  |  | 31,663 |  |  |  | 120,176 |  |  |  | 25,907 |  |  |  | 163,356 |  |  |  | 341,102 |
Net realized investment gains |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (22,367 | ) |  |  | (22,367 | )
Decrease in investment credit loss |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (11,466 | ) |  |  | (11,466 | )
Net gains on equity securities |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (28,296 | ) |  |  | (28,296 | )
Other income |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 11,127 |  |  |  | 11,127 |
Total premiums and other revenues |  | $ | 231,587 |  |  | $ | 286,485 |  |  | $ | 536,644 |  |  | $ | 112,354 |  |  | $ | 1,167,070 |
BENEFITS, LOSSES AND EXPENSES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Policyholder benefits and claims incurred |  | $ | (121,020 | ) |  | $ | (184,331 | ) |  | $ | (346,085 | ) |  | $ | — |  |  | $ | (651,436 | )
Change in fair value of market risk benefits |  |  | — |  |  |  | (14,318 | ) |  |  | — |  |  |  | — |  |  |  | (14,318 | )
Interest credited to policyholders' account balances |  |  | (20,674 | ) |  |  | (118,923 | ) |  |  | — |  |  |  | — |  |  |  | (139,597 | )
Future policy benefit remeasurement losses |  |  | (24,715 | ) |  |  | 4,834 |  |  |  | (19,331 | ) |  |  | — |  |  |  | (39,212 | )
Other operating expenses |  |  | (55,457 | ) |  |  | (23,586 | ) |  |  | (50,470 | ) |  |  | (48,242 | ) |  |  | (177,755 | )
Amortization of deferred policy acquisition costs |  |  | (10,028 | ) |  |  | (3,035 | ) |  |  | (118,694 | ) |  |  | — |  |  |  | (131,757 | )
Total benefits, losses and expenses |  | $ | (231,894 | ) |  | $ | (339,359 | ) |  | $ | (534,580 | ) |  | $ | (48,242 | ) |  | $ | (1,154,075 | )
Income before federal income tax and other items |  | $ | (307 | ) |  | $ | (52,874 | ) |  | $ | 2,064 |  |  | $ | 64,112 |  |  | $ | 12,995 |

Note 22 - Subsequent Events

The Company evaluated all events and transactions through July 23, 2024, the date the accompanying condensed consolidated financial statements were available to be issued.

On May 7, 2024, pursuant to an Agreement and Plan of Merger by and between the Company and American Equity Investment Life Holding Company, an Iowa corporation (“AEL”), the Company merged with and into AEL, with AEL as the surviving entity (the “AEL Merger”). Previously, on May 2, 2024, AEL became an indirect, wholly-owned subsidiary of Brookfield Reinsurance, pursuant to an Agreement and Plan of Merger by and among AEL, Brookfield Reinsurance, and Arches Merger Sub Inc., an Iowa corporation and an indirect, wholly owned subsidiary of Brookfield Reinsurance. In connection with the AEL Merger, AEL expressly assumed all of the Company’s obligations with respect to the $500 million aggregate principal amount of 6.144% unsecured Senior Notes issued by the Company due June 13, 2032. Following the AEL Merger, and pursuant to a Plan of Domestication dated as of May 7, 2024, AEL discontinued its existence as an Iowa corporation and continued its existence as a Delaware corporation, pursuant to applicable Iowa and Delaware laws, and changed its name to American National Group Inc. (“ANGI”). ANGI will file periodic reports as required with the U.S. Securities and Exchange Commission with respect to its Series A Preferred Stock and Series B Preferred Stock, listed on the New York Stock Exchange under the ticker symbols “ANGPRA” and “ANGPRB,” respectively.

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