American National Group Inc.
For the period ended Dec 31, 2024. Filed Mar 31, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 31, 2025
ANG-PD$21.88+0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-29.
0001039828-24-000020
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001039828-25-000010
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 269 previous paragraphs and 169 current paragraphs.
27 unchanged; 5 reworded; 137 added; 236 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 28 previous and 11 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (137)
Current report
Overview of our Business
Current report
As a result of the Post-Effective Merger of American National into AEL, the consolidated financial statements for the periods prior to the Post-Effective Merger represent the results of American National as the accounting acquirer. For periods subsequent to the Post-Effective Merger, the consolidated financial statements represent the combined results of American National and AEL. Throughout this report, unless otherwise specified or the context otherwise requires, all references to “ANGI", the "Company", "we", "our" and similar references are to American National Group Inc. and its consolidated subsidiaries.
Current report
Key Financial Data
Current report
The following table presents key financial data of the Company:
Current report
(1)Distributable Operating Earnings is a Non-GAAP measure. See “Reconciliation of Non-GAAP Measures”.
Current report
Results of Operations
Current report
The results of operations discussed below comprise results for American National for the periods prior to the Post-Effective Merger and the combined results of American National and AEL for periods subsequent to the Post-Effective Merger.
Current report
Net Premiums
Current report
The breakdown of premiums by product, net of ceded premiums is as follows:
Current report
(1)Premiums received from retail annuities are generally recorded as deposits and are not included in net premiums on the Consolidated Statements of Operations.
Current report
(2)Premiums differ from gross annuity sales in Pension Risk Transfer (PRT), since premiums are recognized as revenue when due while they are included in sales upon deal close, which is confirmed by the counterparty.
Current report
For the year ended December 31, 2024, we reported total net premiums of $5.5 billion, compared to net premiums of $3.5 billion in the prior year. The increase of $2.0 billion is primarily driven by continued growth within the PRT business and the execution of the Company’s first U.K. reinsurance transaction, reinsuring $1.3 billion of pension liabilities. Net premiums for our Annuities segment increased by $2.1 billion due to growth in PRT business as noted. Our P&C segment decreased by $139 million due to an increase in ceded premiums with the cession of the specialty market group block of business beginning in Q1 2024.
Current report
For the year ended December 31, 2023, we reported total net premiums of $3.5 billion, compared to $1.5 billion for the period from May 25, 2022 to December 31, 2022, and $979 million for the Predecessor period from January 1, 2022 to May 24, 2022. The increase of $1.1 billion for the year ended December 31, 2023, compared to the period from May 25, 2022 to December 31, 2022 and the Predecessor period from January 1, 2022 to May 24, 2022, is primarily driven by entrance into the PRT market in 2023.
Current report
Net premiums for our P&C segment increased by $143 million for the year ended December 31, 2023, compared to the period from May 25, 2022 to December 31, 2022 and the Predecessor period from January 1, 2022 to May 24, 2022, due to continued strong sales within the P&C business. Our Annuities segment increased by $1.0 billion for the year ended December 31, 2023, compared to the period from May 25, 2022 to December 31, 2022 and the Predecessor period from January 1, 2022 to May 24, 2022, primarily due to entrance into the PRT market in 2023.
Current report
Gross Annuity Sales
Current report
Gross annuity sales are comprised of directly written retail and institutional annuity deposits, which generally are not included in revenues on the Consolidated Statements of Operations.
Current report
The breakdown of gross annuity sales follows:
Current report
(1)Gross annuity sales differ from premiums in Pension Risk Transfer, since premiums are recognized as revenue when due while they are included in sales upon deal close, which is confirmed by the counterparty.
Current report
(2)Variable sales represent additional premiums on previously issued policies.
Current report
For the year ended December 31, 2024, we reported total gross annuity sales of $13.6 billion, compared to gross annuity sales of $5.4 billion in the prior year. The increase of $8.2 billion is primarily due to the addition of fixed index annuity deposits generated by American Equity subsequent to the completion of the acquisition as well as an increase in PRT sales due to continued scaling of that segment of business.
Current report
2023 (Successor) vs 2022 (Successor and Predecessor)
Current report
For the year ended December 31, 2023, we reported total gross annuity sales of $5.4 billion, compared to gross annuity sales of $380 million for the period from May 25, 2022 to December 31, 2022, and $1.1 billion for the Predecessor period from January 1, 2022 to May 24, 2022. The increase of $3.9 billion for the year ended December 31, 2023, compared to the period from May 25, 2022 to December 31, 2022 and the Predecessor period from January 1, 2022 to May 24, 2022, is primarily due to strong sales of fixed rate annuities and entrance into the PRT market in 2023.
Current report
The following table summarizes the financial results of our business for the years ended December 31, 2024 and December 31, 2023, the period from May 25, 2022 to December 31, 2022, and the Predecessor period from January 1, 2022 to May 24, 2022:
Current report
The results of operations discussed below comprise results for American National for the periods prior to the Post-Effective Merger and the combined results of American National and AEL for periods subsequent to the Post-Effective Merger.
Current report
For the year ended December 31, 2024, we reported net income of $729 million, compared to a net income of $392 million in the prior year. The increase is primarily due to an increase in net premiums as a result of the closing of a U.K. pension risk transfer deal during Q4 2024. In addition, net investment income and other policy revenue increased due to the inclusion of American Equity following the acquisition. This increase was partially offset by an increase in policyholder benefits and claims incurred due to growth in the PRT business, an increase in investment related losses due to the transfer of assets associated with the RGA reinsurance transaction and volatility on equity positions, an increase in interest sensitive contract benefits, amortization of deferred policy acquisition costs, deferred sales inducements, and value of business acquired, and operating expenses due to the inclusion of American Equity following the acquisition.
Current report
Net premiums and other policy revenue were $6.2 billion for the year ended December 31, 2024, compared to $3.9 billion in the prior year. The increase of $2.3 billion is primarily due to growth in the PRT business partially offset by an increase in ceded premiums with the cession of the specialty market group block of business beginning in Q1 2024. Additionally, there was an increase in other policy revenue which reflects surrender fee and rider fee income recognized on annuity policies added following the acquisition of American Equity.
Current report
Net investment income increased by $2.2 billion for the year ended December 31, 2024, relative to the prior year. Net investment income is comprised of interest and dividends earned on fixed income investments and equity investments, as well as other miscellaneous income from equity accounted investments primarily consisting of real estate partnerships and investment funds. The increase was primarily driven by the increase in assets under management following the acquisition of American Equity, as well as the continued growth in the existing investment portfolio and the rotation into higher yielding investment strategies.
Current report
Investment related gains (losses) increased by $345 million relative to the prior year. The increase was primarily due to realized losses on investments driven by the transfer of assets pursuant to the RGA reinsurance transaction, which was effective July 1, 2024, as well as volatility on equity positions.
Current report
Policyholder benefits and claims incurred increased by $2.1 billion for the year ended December 31, 2024, relative to the prior year. The increase is primarily due to an increase in growth of the PRT business which resulted in higher reserves. Additionally, there was an increase in catastrophe claims on the property and casualty business due to weather related incidents. These increases were partially offset by a decrease in claims incurred due to the impact of business ceded to RGA beginning in Q2 2024.
Current report
Interest sensitive contract benefits represent interest credited to policyholders’ account balances (“PAB”) from our investment contracts with customers, as well as amortization of deferred revenue. For the year ended December 31, 2024, interest sensitive contract benefits increased by $1.3 billion, which was primarily driven by an increase in the in-force block of annuities business following the acquisition of American Equity.
Current report
Amortization of deferred policy acquisition costs, deferred sales inducements and value of business acquired were $939 million for the year ended December 31, 2024, compared to $525 million in the prior year. The increase of $414 million was primarily due to an increase in the amortization of VOBA due to the increase in the VOBA asset following the acquisition of American Equity, as well as the continued growth of the annuities business, which increases the deferred acquisition cost and deferred sales inducements asset.
Current report
Change in fair value of insurance-related derivatives and embedded derivatives represents the fair value change of call options used to fund the equity-indexed annuity and universal life contracts as well as the fair value change of embedded derivatives of these contracts. Fair value changes are impacted by the expected and actual performance of the indices the call options relate to as well as interest rates used to estimate our embedded derivatives. The decrease in expense of $130 million is attributable to the impact of interest rates and equity market performance on the fair value of the embedded derivatives and equity-indexed options and an update to the short term option budget assumption used in the calculation of the fair value of the embedded derivatives associated with fixed index annuity products.
Current report
Change in fair value of market risk benefits represents the mark-to-market movements of our liability based on the protection to the policyholder from capital market risks. The gain of $3 million for the year ended December 31, 2024 is primarily due to the impact of interest rates and equity markets on the valuation of these liabilities as well as the net impact of updates to the option budget assumption and policyholder lapse assumption used in the calculation of the fair value of market risk benefits. Additionally, the impact of these changes were offset by an increase in market risk benefit liabilities as a result of the acquisition of American Equity leading to increases in the change in the fair value of these liabilities.
Current report
Operating expenses were $880 million for the year ended December 31, 2024 compared to $601 million to the prior year, which represents an increase of $279 million. The increase was primarily driven by transaction expenses incurred related to the acquisition of American Equity as well as an increase associated with eight months of operating expenses from American Equity subsequent to the acquisition.
Current report
Interest expense on borrowings increased by $66 million for the year ended December 31, 2024 compared to the prior year. The increase is primarily driven by increased borrowings with the new term loan entered into in May and new senior notes entered into in October 2024 as well as the acquisition of American Equity which included legacy senior notes and subordinated debt.
Current report
For the year ended December 31, 2023, we reported net income of $392 million, compared to a net income of $324 million for the period from May 25, 2022 to December 31, 2022, and net income of $131 million for the Predecessor period from January 1, 2022 to May 24, 2022. The decrease of $63 million for the year ended December 31, 2023, compared to the period from May 25, 2022 to December 31, 2022 and the Predecessor period from January 1, 2022 to May 24, 2022, is primarily due to an increase in policyholder benefits and claims incurred as a result of the Company closing on several PRT deals in 2023, which increased the corresponding reserve balance. This was partially offset by an increase in net premiums due to the closing of the aforementioned PRT deals and an increase in net investment income due to redeployment of capital into higher yielding investments.
Current report
Net premiums and other policy revenue were $3.9 billion for the year ended December 31, 2023, compared to $1.7 billion for the period from May 25, 2022 to December 31, 2022, and $1.1 billion for the Predecessor period from January 1, 2022 to May 24, 2022. The increase of $1.1 billion for the year ended December 31, 2023, compared to the period from May 25, 2022 to December 31, 2022 and the Predecessor period from January 1, 2022 to May 24, 2022, is primarily due to an increase in net premiums as a result of the closing of several PRT deals during 2023.
Current report
Net investment income was $1.4 billion for the year ended December 31, 2023, compared to $700 million for the period from May 25, 2022 to December 31, 2022, and $513 million for the Predecessor period from January 1, 2022 to May 24, 2022. Net investment income is comprised of interest and dividends earned on fixed income investments and equity investments, as well as other miscellaneous income from equity accounted investments primarily consisting of real estate partnerships and investment funds. The increase of $175 million for the year ended December 31, 2023, compared to the period from May 25, 2022 to December 31, 2022 and the Predecessor period from January 1, 2022 to May 24, 2022, was driven by an increase in effective yield due to rotation of the investment portfolio into higher yielding investments in line with a targeted investment strategy.
Current report
Investment related losses decreased by $45 million for the year ended December 31, 2023, compared to the period from May 25, 2022 to December 31, 2022 and the Predecessor period from January 1, 2022 to May 24, 2022, primarily due to non-recurring realized losses that occurred in Q4 2022 when the Company repositioned a significant portion of its investment portfolio into higher yielding investments. For the year ended December 31, 2023, realized investment losses from real estate impairments were offset by net gains on equity securities.
Current report
Policyholder benefits and claims incurred were $3.3 billion for the year ended December 31, 2023, compared to $1.2 billion for the period from May 25, 2022 to December 31, 2022, and $831 million for the Predecessor period from January 1, 2022 to May 24, 2022. The increase of $1.3 billion for the year ended December 31, 2023, compared to the period from May 25, 2022 to December 31, 2022 and the Predecessor period from January 1, 2022 to May 24, 2022, is primarily due to the closing of several PRT deals in 2023 which led to a corresponding increase in reserves.
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Removed paragraphs (236)
Previous report
Effective January 1, 2023, we adopted Accounting Standards Update 2018-12, Financial Services-Insurance (Topic 944), Targeted Improvements to the Accounting for Long-Duration Contracts (“ASU 2018-12” or "LDTI accounting guidance") which was applied with a transition date of January 1, 2021. As a result, the prior period amounts for the year ended December 31, 2021 and the year ended December 31, 2022 have been adjusted to reflect the new guidance.
Previous report
For information and analysis relating to our financial condition and consolidated results of operations as of and for the year ended December 31, 2022, as well as for the year ended December 31, 2022 compared with the year ended December 31, 2021, see Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Exhibit 99.1 (Recast of certain information in the Company's Annual Report for the year ended December 31, 2022 on Form 10-K for adoption of ASU 2018-12 Targeted Improvements to the Accounting for Long-Duration Contracts) filed on Form 8-K on August 9, 2023.
Previous report
•delay in completing, or failure to complete, the Merger with Brookfield Reinsurance.
Previous report
•disruption of relationships with third parties and employees, diversion of management’s attention, negative publicity, or legal proceedings from efforts to complete the Merger with Brookfield Reinsurance.
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•limits on the ability to pursue alternatives to the Merger with Brookfield Reinsurance.
Previous report
•restrictions on business activities while the Merger Agreement is in effect.
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•strained shareholder relationships or disadvantageous takeover proposals.
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Executive Summary
Previous report
As previously noted, we began to implement an updated strategy, referred to as AEL 2.0, after having undertaken a thorough review of our business in 2020. During 2023, we continued to make significant progress in the execution of the AEL 2.0 strategy in all four key pillars: Go-to-Market, Investment Management, Capital Structure and Foundational Capabilities. See Item 1. Business - Strategy for more information on the AEL 2.0 strategy and progress made during 2023.
Previous report
Excellent customer service teamed with our ability to offer innovative insurance products that provide principal protection and lifetime income resulted in record sales of $7.6 billion during 2023, an increase of 128% from $3.3 billion in 2022. Fixed index annuities represented $7.0 billion of total sales. Fixed index annuity sales increased 122% during 2023 driven by income product sales, which benefited from a higher demand for guaranteed income solutions as a result of high volatility in the markets.
Previous report
We continued to originate privately sourced assets which now comprise 25.8% of the total investment portfolio at December 31, 2023. This is an increase from 22.0% at December 31, 2022. Investment yield was 4.55% in 2023, which is an increase of 23 basis points compared to 2022 and 92 basis points compared to 2021.
Previous report
We increased our cash and cash equivalent holdings to $7.4 billion at December 31, 2023, which will provide us with substantial dry powder to take advantage of opportunities that may emerge in the private asset sector while helping to protect the Company if macro-economic trends were to deteriorate or surrenders increase to greater than expected levels.
Previous report
We achieved $11.5 billion of fee generating reinsured balances and generated $100 million in related revenues in 2023 (on a non-GAAP operating income basis). Effective October 1, 2023, we executed a second Vermont-domiciled redundant reserve financing facility. The new facility reinsured approximately $550 million of in-force statutory reserves for lifetime income benefit rider guarantees. This resulted in approximately $450 million of additional reserve credit for American Equity Life.
Previous report
We repurchased 7.3 million shares of Company common stock, of which 2.5 million shares were repurchased in the open market at an average price of $38.24 and 4.8 million shares were delivered under an accelerated stock repurchase program (ASR) at an average price of $33.12. The ASR was executed on March 17, 2023 with 80% of the shares delivered upon execution. The ASR was terminated on July 13, 2023, and a payment of $14 million was made to settle for the final volume-weighted average price associated with the initial share delivery.
Previous report
We specialize in the sale of individual annuities (primarily fixed and fixed index deferred annuities) through IMOs, agents, banks and broker-dealers. Fixed and fixed index annuities are an important product for Americans looking to fund their retirement needs as annuities have the ability to provide retirees a paycheck for life. We have one business segment which represents our core business comprised of the sale of fixed index and fixed rate annuities.
Previous report
Under U.S. GAAP, premium collections for deferred annuities are reported as deposit liabilities instead of as revenues. Similarly, cash payments to policyholders are reported as decreases in the liabilities for policyholder account balances and not as expenses. Sources of revenues for products accounted for as deposit liabilities are net investment income, surrender charges assessed against policy withdrawals and fees deducted from policyholder account balances for lifetime income benefit riders, net realized gains (losses) on investments and changes in fair value of derivatives. Components of expenses for products accounted for as deposit liabilities are interest sensitive and index product benefits (primarily interest credited to account balances), changes in fair value of embedded derivatives, changes in market risk benefits, amortization of deferred sales inducements and deferred policy acquisition costs, other operating costs and expenses and income taxes.
Previous report
Our profitability depends in large part upon:
Previous report
•the amount of assets under our management,
Previous report
•investment spreads we earn on our policyholder account balances,
Previous report
•our ability to manage our investment portfolio to maximize returns and minimize risks such as interest rate changes and defaults or credit losses,
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•our ability to appropriately price for lifetime income benefit riders offered on certain of our fixed rate and fixed index annuity policies,
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•our ability to manage interest rates credited to policyholders and costs of the options purchased to fund the annual index credits on our fixed index annuities,
Previous report
•our ability to manage the costs of acquiring new business (principally commissions paid to agents and distribution partners and bonuses credited to policyholders),
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•our ability to maintain and continue to generate fee based revenue,
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•our ability to manage our operating expenses, and
Previous report
•income taxes.
Previous report
Life insurance companies are subject to NAIC RBC requirements and rating agencies utilize a form of RBC to partially determine capital strength of insurance companies. The American Equity Life RBC ratio at December 31, 2023 and 2022 was 380% and 415%, respectively.
Previous report
On August 30, 2023, S&P affirmed its "A-" financial strength rating on American Equity Life and its "BBB-" long-term issuer credit rating on American Equity Investment Life Holding Company. Following the announcement of the merger agreement with Brookfield Reinsurance, S&P placed these credit ratings on credit watch with negative implications as the expected impact of the announced agreement was evaluated.
Previous report
On July 6, 2023, Fitch affirmed its "A-" financial strength rating on American Equity Investment Life Insurance Company and its life insurance subsidiaries, its "BBB" issuer default rating on American Equity Investment Life Holding Company and its "BBB-" senior unsecured debt ratings, and revised its outlook to "stable" from "negative" on its financial strength, issuer default and senior unsecured debt ratings.
Previous report
On September 9, 2022, A.M. Best affirmed its "A-" financial strength rating on American Equity Investment Life Insurance Company and its subsidiaries, American Equity Investment Life Insurance Company of New York and Eagle Life Insurance Company, its "bbb-" long-term issuer credit rating of American Equity Investment Life Holding Company, its "bbb-" senior unsecured debt ratings, and its "bb" perpetual, non-cumulative preferred stock ratings. The outlook for these credit ratings of "stable" was also affirmed by A.M. Best on September 9, 2022. Following the announcement of the merger agreement with Brookfield Reinsurance, A.M. Best placed these credit ratings on watch, noting the ratings will likely remain under review pending completion of the merger.
Previous report
Earnings from products accounted for as deposit liabilities are primarily generated from the excess of net investment income earned over the interest credited or the cost of providing index credits to the policyholder, or the "investment spread." Our investment spread is summarized as follows:
Previous report
The cost of money for fixed index annuities and average crediting rates for fixed rate annuities are computed based upon policyholder account balances and do not include the impact of amortization of deferred sales inducements. See Critical Accounting Policies and Estimates—Deferred Policy Acquisition Costs and Deferred Sales Inducements. With respect to our fixed index annuities, the cost of money includes the average crediting rate on amounts allocated to the fixed rate strategy and expenses we incur to fund the annual index credits. Proceeds received upon expiration of call options purchased to fund annual index credits are recorded as part of the change in fair value of derivatives and are largely offset by an expense for interest credited to annuity policyholder account balances. See Critical Accounting Policies and Estimates - Policy Liabilities for Fixed Index Annuities and Financial Condition - Derivative Instruments.
Previous report
Average yield on invested assets increased primarily as a result of new money yields and the benefit of higher short-term interest rates on our floating rate portfolio partially offset by lower returns on our private assets and partnerships, lower prepayment income and an increase in investment expenses. See Net investment income. The aggregate cost of money increased primarily due to increases in options costs slightly offset by an increase in the benefit from over hedging as compared to the prior year. We have the flexibility to reduce our crediting rates if necessary and could decrease our cost of money by approximately 123 basis points if we reduce current rates to guaranteed minimums.
Previous report
Results of Operations for the Three Years Ended December 31, 2023
Previous report
Annuity deposits by product type collected during 2023, 2022 and 2021, were as follows:
Previous report
Annuity deposits before coinsurance ceded increased 128% during 2023 compared to 2022. Annuity deposits after coinsurance ceded increased 121% during 2023 compared to 2022. The increase in sales in 2023 compared to 2022 was primarily driven by increases in fixed index annuity sales as a result of our income product sales, which benefited from a higher demand for guaranteed income solutions as a result of high volatility in the markets. In addition, annuity deposits for 2023 benefited from an increase in multi-year fixed rate annuities (MYGA) which reflects pricing support from the execution of the amendment to our reinsurance agreement with AeBe ISA LTD ("AeBe") to cede new MYGA flow business beginning in the first quarter of 2023.
Previous report
We began ceding certain fixed rate annuities issued after February 8, 2023 to AeBe, and we have continued to increase the amount of business ceded to North End Re under the reinsurance agreement executed in 2021, both of which contributed to the increase in coinsurance ceded annuity deposits in 2023 compared to 2022.
Previous report
Net income available to common stockholders decreased 91% to $166.9 million in 2023 and increased 268% to $1.9 billion in 2022 from $509.3 million in 2021. The decrease in net income available to common stockholders for the year ended December 31, 2023 was driven by an increase in the change in fair value of embedded derivatives, a decrease in net investment income, an increase in net realized losses on investments and an increase in other operating costs and expenses partially offset by an increase in the change in fair value of derivatives, an increase in annuity product charges and an increase in other revenue.
Previous report
Net income, in general, is impacted by the volume of business in force and the investment spread earned on this business. The average amount of annuity account balances outstanding (net of annuity liabilities ceded under coinsurance agreements) decreased 8% to $47.3 billion for the year ended December 31, 2023 compared to $51.6 billion in 2022 and decreased 4% for the year ended December 31, 2022 compared to $53.7 billion in 2021. Our investment spread measured in dollars was $1.3 billion, $1.4 billion, and $1.2 billion for the years ended December 31, 2023, 2022 and 2021, respectively. Investment income for the year ended December 31, 2023 was negatively impacted by lower volumes of business in force as a result of in-force reinsurance transactions executed in 2022 as well as lower returns on private assets and partnerships, lower prepayment income and an increase in investment expenses which were partially offset by the benefits to net investment income from higher short-term interest rates on our floating rate portfolio and attractive new money rates (see Net investment income).
Previous report
Net income was also impacted by the change in fair value of derivatives and embedded derivatives, which fluctuates from period to period based upon changes in fair values of call options purchased to fund the annual index credits for fixed index annuities and changes in interest rates used to discount the embedded derivative liability. Net income for the year ended December 31, 2023 was negatively impacted by an increase in the change in fair value of embedded derivatives and positively impacted by an increase in the change in fair value of derivatives. See Change in fair value of derivatives, and Change in fair value of embedded derivatives.
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Reworded paragraphs (5)
Previous wording
Management's discussion and analysis reviews our consolidated financial position at December 31, 2023 compared with December 31, 2022, and our consolidated results of operations for the years ended December 31, 2023 and 2022, and where appropriate, factors that may affect future financial performance. This analysis should be read in conjunction with our audited consolidated financial statements, notes thereto and selected consolidated financial data appearing elsewhere in this report.
Current wording
Management's discussion and analysis reviews our consolidated financial position at December 31, 2024 compared with December 31, 2023, December 31, 2022, and May 24, 2022 and our consolidated results of operations for the years ended December 31, 2024 and 2023, the successor period of May 25, 2022 to December 31, 2022, and the predecessor period of January 1, 2022 to May 24, 2022 and where appropriate, factors that may affect future financial performance. This analysis should be read in conjunction with our audited consolidated financial statements, notes thereto and selected consolidated financial data appearing elsewhere in this report.
Previous wording
All statements, trend analysis and other information contained in this report and elsewhere (such as in filings by us with the SEC, press releases, presentations by us or management or oral statements) may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended. Forward-looking statements give expectations or forecasts of future events and do not relate strictly to historical or current facts. They may relate to markets for our products, trends in our operations or financial results, strategic alternatives, future operations, strategies, plans, partnerships, investments, share buybacks and other financial developments. They use words and terms such as anticipate, assume, believe, can, continue, could, enable, estimate, expect, foreseeable, goal, improve, intend, likely, may, model, objective, opportunity, outlook, plan, potential, project, remain, risk seek, should, strategy, target, will, would, and other words and terms of similar meaning or that are otherwise tied to future periods or future performance, in each case in all forms of speech and derivative forms, or similar words, as well as any projections of future events or results. Forward-looking statements, by their nature, are subject to a variety of assumptions, risks, and uncertainties that could cause actual results to differ materially from the results projected. Many of these risks and uncertainties cannot be controlled by the Company. Factors that may cause our actual decisions or results to differ materially from those contemplated by these forward-looking statements include, among other things:
Current wording
All statements, trend analysis and other information contained in this report and elsewhere (such as in filings by us with the SEC, press releases, presentations by us or management or oral statements) may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, the Securities Act or the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements give expectations or forecasts of future events and do not relate strictly to historical or current facts. They may relate to markets for our products, trends in our operations or financial results, strategic alternatives, future operations, strategies, plans, partnerships, investments, share buybacks and other financial developments. They use words and terms such as anticipate, assume, believe, can, continue, could, enable, estimate, expect, foreseeable, goal, improve, intend, likely, may, model, objective, opportunity, outlook, plan, potential, project, remain, risk seek, should, strategy, target, will, would, and other words and terms of similar meaning or that are otherwise tied to future periods or future performance, in each case in all forms of speech and derivative forms, or similar words, as well as any projections of future events or results. Forward-looking statements, by their nature, are subject to a variety of assumptions, risks, and uncertainties that could cause actual results to differ materially from the results projected. Many of these risks and uncertainties cannot be controlled by the Company. Factors that may cause our actual decisions or results to differ materially from those contemplated by these forward-looking statements include, among other things:
Previous wording
•U.S. and global capital market and economic deterioration due to major public health issues, including the COVID-19 pandemic, political or social developments, or otherwise.
Current wording
•U.S. and global capital market and economic deterioration due to major public health issues, including political or social developments, or otherwise.
Previous wording
MRBs are measured at fair value, at the individual contract level, and can be either an asset or a liability. Contracts which contain more than one MRB feature are combined into one single MRB. The fair value is calculated using stochastic models that include a risk margin and incorporate a spread for our nonperformance risk. At contract inception, an attributed fee ratio is calculated based on the present value of the fees and assessments collectible from the policyholder relative to the present value of expected benefits paid attributable to the MRB. The attributed fees remain static over the life of the MRB and is used to calculate the fair value of the MRB using a risk neutral valuation method. The attributed fees cannot be negative and cannot exceed the total explicit fees collectible from the policyholder.
Current wording
Market risk benefits (“MRB”) are contracts or contract features that provide protection to the policyholder from other-than-nominal capital market risk and expose us to such risk. The Company issues certain fixed indexed annuity and fixed rate annuity contracts that provide minimum guarantees to policyholders including guaranteed minimum withdrawal benefits and guaranteed minimum death benefits that are MRBs. MRBs are measured at fair value, at the individual contract level, and can be either an asset or a liability. Contracts which contain more than one MRB feature are combined into one single MRB. The fair value is calculated using stochastic models. At contract inception, attributed fees are calculated based on the present value of the fees and assessments collectible from the policyholder relative to the present value of expected benefits paid attributable to the MRB. The attributed fees remain static over the life of the MRB and are used to calculate the fair value of the MRB using a risk neutral valuation method. The attributed fees cannot be negative and cannot exceed the total explicit fees collectible from the policyholder. The periodic change in fair value is recognized in earnings with the exception of the periodic change in fair value related to the instrument-specific credit risk, which is recognized in other comprehensive income (“OCI”).
Previous wording
See Note 1 - Significant Accounting Policies to our audited consolidated financial statements in this Form 10-K beginning on page F-12, which is incorporated by reference in this Item 7, for new accounting pronouncement disclosures.
Current wording
See Note 2 - Summary of Significant Accounting Policies to our consolidated financial statements in this Form 10-K, which is incorporated by reference in this Item 2.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Market risk benefits (MRBs) are contracts or contract features that both provide protection to the policyholder from other-than-nominal capital market risk and expose the Company to other-than-nominal capital market risk. We issue certain fixed indexed annuity and fixed rate annuity contracts that provide minimum guarantees to policyholders including guaranteed minimum withdrawal benefits (GMWB) and guaranteed minimum death benefits (GMDB) that are MRBs.