LINCOLN NATIONAL CORP
For the period ended Mar 31, 2026. Filed May 7, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 7, 2026
Extracted filing text, with the paragraph anchors used by the comparison.
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Results of Consolidated Operations
Details underlying the consolidated results (in millions) were as follows:
| For the Three Months Ended March 31, | ||
|---|---|---|
| 2026 | 2025 | |
| Net Income (Loss) | ||
| Income (loss) from operations: | ||
| Annuities | $275 | $290 |
| Life Insurance | 41 | (16) |
| Group Protection | 112 | 101 |
| Retirement Plan Services | 43 | 34 |
| Other Operations | (111) | (95) |
| Net annuity product features, pre-tax (1) | (695) | (1,092) |
| Net life insurance product features, pre-tax | 22 | 42 |
| Credit loss-related adjustments, pre-tax | (20) | (28) |
| Investment gains (losses), pre-tax | (42) | (103) |
| Changes in the fair value of reinsurance-related | ||
| embedded derivatives, trading securities and | ||
| certain mortgage loans, pre-tax (2) | 179 | (90) |
| Gains (losses) on other non-financial | ||
| assets, pre-tax | (6) | – |
| Other items, pre-tax (3)(4)(5)(6) | (111) | (35) |
| Income tax benefit (expense) related to the | ||
| above pre-tax items | 141 | 270 |
| Net income (loss) | $(172) | $(722) |
(1)For the three months ended March 31, 2026 and 2025, includes changes in MRBs of $(997) million and $(1,302) million, respectively; changes in the fair value of the related hedge instruments inclusive of income allocated to support the cost of hedging or future benefits of $177 million and $268 million, respectively; and changes in the fair value of the embedded derivative liabilities and the associated index options for our indexed annuity products of $125 million and $(58) million, respectively.
(2)Includes primarily changes in the fair value of the embedded derivative related to the fourth quarter 2023 reinsurance transaction. The coinsurance with funds withheld investment portfolio includes fixed maturity securities classified as AFS with changes in fair value recorded in OCI. Since the corresponding and offsetting changes in fair value of the embedded derivative related to the coinsurance with funds withheld investment portfolio are recorded in realized gain (loss), volatility can occur within net income (loss). See Note 7 for more information.
(3)Includes certain legal accruals of $(122) million for the three months ended March 31, 2026.
(4)Includes severance expense related to initiatives to realign the workforce of $(7) million and $(6) million for the three months ended March 31, 2026 and 2025, respectively.
(5)Includes transaction, integration and other costs related to mergers, acquisitions, divestitures and certain other corporate initiatives of $(20) million related to the sale of our wealth management business for the three months ended March 31, 2025.
(6)Includes deferred compensation mark-to-market adjustment of $18 million and $(9) million for the three months ended March 31, 2026 and 2025, respectively.
Net loss decreased due primarily to the following:
Lower loss in net annuity product features driven by the impact of capital markets.
Favorable changes in the fair value of reinsurance-related embedded derivatives, trading securities and certain mortgage loans in 2026 compared to unfavorable changes in 2025 driven by the fair value of the embedded derivative related to the fourth quarter 2023 reinsurance transaction.
Lower investment losses driven by lower losses on certain investments associated with the fourth quarter 2023 reinsurance transaction.
Higher investment income on alternative investments.
Improvement in our Life Insurance segment’s income from operations and in our Group Protection segment’s total loss ratio.
The decrease in net loss was partially offset by higher net unfavorable other items.
For information on the fourth quarter 2023 reinsurance transaction, see Note 7.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.