American National Group Inc.

Previous wording

Management's discussion and analysis reviews our unaudited consolidated financial position at March 31, 2025 compared with December 31, 2024, and our unaudited consolidated results of operations for the three months ended March 31, 2025 and 2024, and where appropriate, factors that may affect future financial performance. This analysis should be read in conjunction with our unaudited consolidated financial statements, notes thereto and selected consolidated financial data appearing elsewhere in this Form 10-Q as well as the December 31, 2024 audited consolidated financial statements included in the Form 10-K, filed with the SEC on March 31, 2025. Interim operating results for the three months ended March 31, 2025 are not necessarily indicative of the results expected for the entire year. Preparation of financial statements requires use of management estimates and assumptions.

Current wording

Management's discussion and analysis reviews our unaudited condensed consolidated financial position at June 30, 2025 compared with December 31, 2024, and our unaudited condensed consolidated results of operations for the three and six months ended June 30, 2025 and 2024, and where appropriate, factors that may affect future financial performance. This analysis should be read in conjunction with our unaudited condensed consolidated financial statements, notes thereto and selected condensed consolidated financial data appearing elsewhere in this Form 10-Q as well as the December 31, 2024 audited consolidated financial statements included in the Form 10-K, filed with the SEC on March 31, 2025. Interim operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results expected for the entire year. Preparation of financial statements requires use of management estimates and assumptions.

Previous wording

Through our insurance subsidiaries, our Company is focused on securing the financial futures of individuals and institutions through a range of insurance and retirement services. Our business is presently conducted through our subsidiaries under three operating segments: Annuities, Property and Casualty (“P&C”) and Life Insurance.

Current wording

Through our insurance subsidiaries, our Company is primarily focused on providing insurance solutions to individuals and institutions through a broad range of annuity and retirement products and services. Our business is presently conducted through our subsidiaries under three operating segments: Annuities, Property and Casualty (“P&C”) and Life Insurance.

Previous wording

Results of Operations for the Three Months Ended March 31, 2025 and 2024

Current wording

Results of Operations for the Three and Six Months Ended June 30, 2025 and 2024

Previous wording

For the three months ended March 31, 2025, we reported total gross annuity sales of $3.8 billion, compared to gross annuity sales of $1.5 billion in the prior year period. The increase of $2.3 billion is primarily due to the contribution of fixed index annuity deposits generated by American Equity subsequent to the completion of the acquisition coupled with our FABN issuance during the quarter.

Current wording

For the six months ended June 30, 2025, we reported total gross annuity sales of $8.1 billion, compared to gross annuity sales of $4.8 billion in the prior year period. The increase of $3.2 billion is primarily due to our FABN issuances during the period coupled with increased sales in our fixed index annuity product contributed from AEL.

Previous wording

The following table summarizes the financial results of our business for the three months ended March 31, 2025 and 2024:

Current wording

The following table summarizes the financial results of our business for the three and six months ended June 30, 2025 and 2024:

Previous wording

Change in fair value of insurance-related derivatives and embedded derivatives increased by $218 million for the three months ended March 31, 2025 compared to the same period of 2024. The increase was primarily due to the impact of interest rates and equity market performance on the fair value of the embedded derivatives and equity-indexed options.

Current wording

Change in fair value of insurance-related derivatives and embedded derivatives increased by $110 million for the three months ended June 30, 2025 compared to the same period of 2024. The increase was primarily due to the impact of interest rates and equity market performance on the fair value of the embedded derivatives and equity-indexed options.

Previous wording

For the three months ended March 31, 2025, we reported net loss of $(206) million, compared to a net income of $113 million for the same period in 2024. The decrease is primarily due to an increase in the expense associated with the change in fair value of insurance-related derivatives and embedded derivatives and an increase in the expense associated with the change in fair value of market risk benefits as a result of equity market and interest rate movements. Additionally, there was an decrease in net premiums due to lower PRT sales and an increase in interest sensitive contract benefits and operating expenses due to the inclusion of American Equity following the acquisition. This decrease was partially offset by an increase in net investment income and other policy revenue due to the inclusion of American Equity and a decrease in policyholder benefits and claims incurred due to improved results within the property casualty line of business and decreased sales activity.

Current wording

For the six months ended June 30, 2025, we reported net loss of $(54) million, compared to a net income of $368 million for the same period in 2024. The decrease is primarily due to a lower tax benefit in 2025 compared to 2024 driven by a deferred tax benefit recognized in 2024 related to Bermuda corporate income tax. Additionally, the decrease was driven by an increase in the change in fair value of insurance-related derivatives and embedded derivatives and increase in the change in fair value of market risk benefits as a result of equity market and interest rate movements, an increase in interest sensitive contract benefits, an increase in amortization of DAC, DSI, and VOBA, and an increase in operating expense all of which are a result of continued growth of the annuity business and inclusion of American Equity following the acquisition. Those impacts were partially offset by an increase in net investment income and an increase in other policy revenue due to the inclusion of American Equity following the acquisition.

Previous wording

Net investment income increased by $835 million for the three months ended March 31, 2025, compared to the same period in 2024. 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 wording

Net investment income increased by $1.1 billion for the six months ended June 30, 2025, compared to the same period in 2024. The increase was primarily driven by the increase in assets under management following the acquisition of American Equity as well as the continued rotation into higher yielding investment strategies.

Previous wording

The Company incurred investment related losses of $4 million for the three months ended March 31, 2025, compared to $34 million for the same period in 2024. The decrease in investment losses of $30 million was primarily due to unrealized losses on equity securities, short-term investments and other invested assets for the three months ended March 31, 2024.

Current wording

The Company incurred investment related gains of $69 million for the six months ended June 30, 2025, compared to losses of $32 million for the same period in 2024. The increase in investment gains of $101 million was primarily due to unrealized fair value gains on our equity securities.

Previous wording

Policyholder benefits and claims incurred decreased by $198 million for the three months ended March 31, 2025, compared to the same period in 2024. The decrease is primarily due to improved results within the property casualty line of business, decreased sales activity, and the impact of business ceded to RGA beginning in Q2 2024.

Current wording

Policyholder benefits and claims incurred decreased by $400 million for the six months ended June 30, 2025, compared to the same period in 2024. The decrease is primarily due to a reduction in PRT sales which resulted in lower reserve changes coupled with a decrease in claims incurred due to the impact of business ceded to RGA subsequent to the effectuation of the reinsurance transaction.

Previous wording

For the three months ended March 31, 2025, interest sensitive contract benefits increased compared to the same period in 2024 by $357 million which was primarily driven by an increase in the in-force block of annuity business following the acquisition of American Equity.

Current wording

For the six months ended June 30, 2025, interest sensitive contract benefits increased compared to the same period in 2024 by $452 million which was primarily driven by an increase in the in-force block of annuity business following the acquisition of American Equity.

Previous wording

Amortization of deferred policy acquisition costs, deferred sales inducements and value of business acquired increased by $157 million compared to the same period in 2024, 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 annuity business which increases the deferred acquisition cost asset.

Current wording

Amortization of deferred policy acquisition costs, deferred sales inducements and value of business acquired increased by $290 million compared to the same period in 2024, 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 annuity business which increases the deferred acquisition cost and deferred sales inducements assets.

Previous wording

The increase in the change in fair value of market risk benefit of $342 million for the three months ended March 31, 2025 compared to the same period of 2024 was primarily due to the impact of interest rates and equity markets on the valuation of these liabilities. Additionally, the market risk benefit liabilities increased as a result of the acquisition of American Equity leading to increases in the change in the fair value of these liabilities.

Current wording

The increase in the change in fair value of market risk benefit of $156 million for the six months ended June 30, 2025 compared to the same period of 2024 was primarily due to the impact of interest rates and equity markets on the valuation of these liabilities. Additionally, the market risk benefit liabilities increased as a result of the acquisition of American Equity leading to increases in the change in the fair value of these liabilities.

Previous wording

Operating expenses increased by $172 million for the three months ended March 31, 2025 compared to the same period in 2024, primarily driven by the contribution of expenses from American Equity subsequent to the acquisition as well as additional costs incurred to support the continued growth of our business.

Current wording

Operating expenses increased by $53 million for the six months ended June 30, 2025 compared to the same period in 2024, primarily driven by the contribution of expenses from American Equity subsequent to the acquisition as well as additional costs incurred to support the continued growth of our business.

Previous wording

Interest expense on borrowings increased by $22 million for the three months ended March 31, 2025 compared to the same period in 2024 primarily as a result of increased borrowings with the new term loan entered into in May 2024 as well as the acquisition of American Equity which included legacy senior notes and subordinated debt.

Current wording

Interest expense on borrowings increased by $28 million for the six months ended June 30, 2025 compared to the same period in 2024 primarily as a result of increased borrowings with the new term loan entered into in May 2024 as well as the acquisition of American Equity which included legacy senior notes and subordinated debt.

Previous wording

The following table presents DOE of each of our reporting segments for the three months ended March 31, 2025 and 2024:

Current wording

The following table presents DOE of each of our reporting segments for the three and six months ended June 30, 2025 and 2024:

Previous wording

Life Insurance – DOE decreased by $25 million for the three months ended March 31, 2025 compared to the same period in 2024. The decrease was driven by higher policyholder benefits, lower investment income due to an increase in cash and cash equivalents held during the period, and the impact of the RGA reinsurance treaty executed during the third quarter of 2024.

Current wording

Life Insurance – DOE decreased by $23 million for the three months ended June 30, 2025 compared to the same period in 2024. The decrease is primarily driven by the impact of the RGA reinsurance treaty executed during the third quarter of 2024.

Previous wording

Annuities – DOE increased by $302 million for the three months ended March 31, 2025 compared to the same period in 2024. The increase is primarily attributable to earnings contributed from AEL, coupled with new business wins and higher spread earnings.

Current wording

Annuities – DOE increased by $428 million for the six months ended June 30, 2025 compared to the same period in 2024. The increase is primarily attributable to a full period of earnings contributed from AEL, coupled with new business wins and higher spread earnings.

Previous wording

Property and Casualty – DOE increased by $15 million for the three months ended March 31, 2025 compared to the same period in 2024. The increase was driven by improvements in loss experience arising from underwriting actions implemented since the prior year period.

Current wording

Property and Casualty – DOE increased by $31 million for the six months ended June 30, 2025 compared to the same period in 2024. The increase was driven by improvements in loss experience arising from underwriting actions implemented since the prior year period.

Previous wording

Total assets increased by $2.2 billion during the period to $123.4 billion. The increase primarily driven by net annuity inflows coupled with favorable unrealized fair value movements on our fixed maturity investments from a decrease in interest rates during the quarter.

Current wording

Total assets increased by $5.1 billion during the period to $126.3 billion. The increase is primarily driven by net annuity inflows, investment purchases and favorable fair value movements on our equity securities portfolio.

Previous wording

Total investments increased by $5.9 billion from December 31, 2024 to March 31, 2025. The increase is primarily driven by the redeployment of cash and cash equivalents into short-term investments, coupled with annuity sales during the quarter.

Current wording

Total investments increased by $4.1 billion from December 31, 2024 to June 30, 2025. The increase is primarily driven by the redeployment of cash and cash equivalents into fixed maturity investments, investment purchases and favorable unrealized fair value movements on our equity securities portfolio.

Previous wording

Deferred policy acquisition costs (“DAC”), deferred sales inducements (“DSI”) and value of business acquired (“VOBA”) are capitalized costs directly related to writing new policyholder contracts and include the VOBA intangible assets. During the year, the balance increased by $152 million primarily driven by deferrals associated with writing new business during the quarter.

Current wording

Deferred policy acquisition costs (“DAC”), deferred sales inducements (“DSI”) and value of business acquired (“VOBA”) are capitalized costs directly related to writing new policyholder contracts and include the VOBA intangible assets. During the year, the balance increased by $420 million primarily driven by deferrals associated with writing new business during the period.

Previous wording

Ceded unearned premiums represent a portion of unearned premiums ceded to reinsurers. The decrease of $3 million from December 31, 2024 to March 31, 2025 is primarily driven by the recognition of earned premiums subject to reinsurance.

Current wording

Ceded unearned premiums represent a portion of unearned premiums ceded to reinsurers. The increase of $41 million from December 31, 2024 to June 30, 2025 is primarily driven by the recognition of earned premiums subject to reinsurance.

Previous wording

Deferred tax assets decreased by $12 million from December 31, 2024 to March 31, 2025. The decrease is primarily due to changes in unrealized gains or losses in our investments, reserves held for policyholder benefits offset by an increase in our net operating loss carryforwards.

Current wording

Deferred tax assets decreased by $58 million from December 31, 2024 to June 30, 2025. The decrease is primarily due to the utilization of the deferred tax asset related to Bermuda and changes in unrealized gains or losses in our investments offset by an increase in our net operating loss carryforwards.

Previous wording

Reinsurance recoverables and deposit assets are estimated amounts due to the Company from reinsurers and include reinsurance receivables and recoverables from reinsurers and deposit assets associated with reinsurance agreements. The amount decreased by $112 million in the year due to a decrease in reinsurance recoverable due to an increase in benefits and surrenders ceded for existing American Equity reinsurance agreements as flow business is not being ceded to external reinsurers.

Current wording

Reinsurance recoverables and deposit assets are estimated amounts due to the Company from reinsurers and include reinsurance receivables and recoverables from reinsurers and deposit assets associated with reinsurance agreements. The amount decreased by $220 million primarily driven by a reduction in the associated insurance liabilities.

Previous wording

Intangible assets increased by $24 million during the year, primarily due to capitalization of costs associated with software and other intangible assets.

Current wording

Intangible assets increased by $12 million during the year, primarily due to capitalization of costs associated with software and other intangible assets.

Previous wording

Other assets increased by $113 million during the year to $2.9 billion. The balance includes current tax asset, market risk benefit asset, prepaid pension assets, as well as other miscellaneous receivables, and is attributable to an increase in the market risk benefit asset due movements within the equity market and interests.

Current wording

Other assets increased by $91 million during the year to $2.8 billion. The balance includes current tax asset, market risk benefit asset, prepaid pension assets, as well as other miscellaneous receivables, and is primarily attributable to an increase in the current tax asset.

Previous wording

Separate account assets and liabilities both decreased by $90 million during 2025, primarily due to policyholder benefits and withdrawals during the quarter.

Current wording

Separate account assets and liabilities both decreased by $21 million during 2025, primarily due to policyholder benefits and withdrawals during the quarter.

Previous wording

Future policy benefits and policyholders’ account balances increased by $2.0 billion during 2025 primarily driven by annuity sales during the period as well as the the impact of changes in interest rates and equity markets on the valuation of the liabilities.

Current wording

Future policy benefits and policyholders’ account balances increased by $4.7 billion during 2025 primarily driven by annuity sales during the period as well as the impact of changes in interest rates and equity markets on the valuation of the embedded derivatives during the period.

Previous wording

Market risk benefits increased by $411 million during 2025 primarily due to the impact of changes in interest rates and equity markets on the valuation market risk benefits.

Current wording

Market risk benefits increased by $572 million during 2025 primarily due to the impact of changes in interest rates and equity markets on the valuation market risk benefits.

Previous wording

Funds withheld for reinsurance liabilities decreased by $124 million during 2025 as a result of decrements on the existing ceded liabilities and the corresponding funds withheld payable as flow business is not being ceded to external reinsurers.

Current wording

Funds withheld for reinsurance liabilities decreased by $150 million during 2025 as a result of decrements on the existing ceded liabilities and the corresponding funds withheld payable as flow business is not being ceded to external reinsurers.

Previous wording

Other liabilities increased by $25 million during 2025. The balance includes the reinsured market risk benefits liability, accrued interest on debt and other miscellaneous payables. The increase during 2025 is primarily due to the change in deferred and current tax liabilities.

Current wording

Other liabilities decreased by $97 million during 2025. The balance includes the reinsured market risk benefits liability, accrued interest on debt and other miscellaneous payables. The decrease during 2025 is primarily driven by a decrease in miscellaneous payables.

Previous wording

Today, we have significant liquidity within our insurance portfolios, giving us flexibility to secure attractive investment opportunities. In addition to a portfolio of highly liquid financial assets, our operating companies have additional access to liquidity from sources such as the Federal Home Loan Bank (“FHLB”) and access to a sub-allocation under the Brookfield Wealth Solutions revolving credit facility. As of March 31, 2025, the Company had no drawings and a total of $1.1 billion undrawn commitment available related to this program, and access to $300 million of capacity under the revolving credit facility.

Current wording

Today, we have significant liquidity within our insurance portfolios, giving us flexibility to secure attractive investment opportunities. In addition to a portfolio of highly liquid financial assets, our operating companies have additional access to liquidity from sources such as the Federal Home Loan Bank (“FHLB”) and access to a sub-allocation under the Brookfield Wealth Solutions revolving credit facility. As of June 30, 2025, the Company had no drawings and a total of $1.4 billion undrawn commitment available related to this program, and access to $300 million of capacity under the revolving credit facility.

Previous wording

Liquidity within our insurance subsidiaries may be restricted from time to time due to regulatory constraints. As of March 31, 2025, the Company’s total liquidity was $41.2 billion, which included $342 million of unrestricted cash and cash equivalents held outside of the regulated insurance companies.

Current wording

Liquidity within our insurance subsidiaries may be restricted from time to time due to regulatory constraints. As of June 30, 2025, the Company’s total liquidity was $49.9 billion, which included $306 million of unrestricted cash and cash equivalents held outside of the regulated insurance companies.

Previous wording

Comparison of the Three Months Ended March 31, 2025 and 2024

Current wording

Comparison of the Six Months Ended June 30, 2025 and 2024

Previous wording

The following table presents a summary of our cash flows and ending cash balances for the three months ended March 31, 2025 and 2024:

Current wording

The following table presents a summary of our cash flows and ending cash balances for the six months ended June 30, 2025 and 2024:

Previous wording

For the three months ended March 31, 2025, cash outflows arose as we deployed cash and cash equivalents held as of December 31, 2024 to short-term investments and continued to rotate our investment portfolio into higher yielding investment strategies. This resulted in net deployment of $5.7 billion of cash from investing activities, compared to net deployment of $1.5 billion in the prior year.

Current wording

For the six months ended June 30, 2025, cash outflows arose as we deployed cash and cash equivalents held as of December 31, 2024 to short-term investments, investment funds, and available-for-sale fixed maturity securities and continued to rotate our investment portfolio into higher yielding investment strategies. This resulted in net deployment of $3.1 billion of cash from investing activities, compared to net inflow of $7.7 billion in the prior year.

Previous wording

For the three months ended March 31, 2025, we recorded a net cash inflow of $1.3 billion from our financing activities, compared to $328 million recorded in 2024. The proceeds in the current year period were mainly as a result of $1.2 billion net payments received on policyholders’ account deposits partially offset by withdrawals on such accounts.

Current wording

For the six months ended June 30, 2025, we recorded a net cash inflow of $2.7 billion from our financing activities, compared to $1.7 billion recorded in 2024. The proceeds in the current year period were mainly as a result of $2.7 billion net payments received on policyholders’ account deposits partially offset by withdrawals on such accounts.

Previous wording

As of March 31, 2025, the Company and its subsidiaries, in aggregate, had total unfunded investment commitments of $4.3 billion. The funded commitments are primarily recognized as mortgage loans, private loans, investment funds, investment real estate and other invested assets. For additional information, see Note 27 - Financial Commitments and Contingencies of the financial statements.

Current wording

As of June 30, 2025, the Company and its subsidiaries, in aggregate, had total unfunded investment commitments of $3.1 billion. The unfunded commitments are primarily recognized as mortgage loans, private loans, investment funds, investment real estate and other invested assets. For additional information, see Note 27 - Financial Commitments and Contingencies of the financial statements.

Previous wording

To measure performance, we focus on net income and total assets, as well as certain Non-GAAP measures, including DOE and Total Liquidity, which we believe are useful to investors to provide additional insights into assets within the business available for redeployment. Refer to the “Results of Operations”, “Financial Condition,” and “Liquidity and Capital Resources” sections of this MD&A for further discussion on our performance and Non-GAAP measures for the three months ended March 31, 2025 and 2024.

Current wording

To measure performance, we focus on net income and total assets, as well as certain Non-GAAP measures, including DOE and Total Liquidity, which we believe are useful to investors to provide additional insights into assets within the business available for redeployment. Refer to the “Results of Operations”, “Financial Condition,” and “Liquidity and Capital Resources” sections of this MD&A for further discussion on our performance and Non-GAAP measures for the three and six months ended June 30, 2025 and 2024.