Brighthouse Financial, Inc.
For the period ended Dec 31, 2025. Filed Feb 24, 2026.
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FY2025 · Filed Feb 24, 2026
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Annual Actuarial Review
We conducted our GAAP AAR in the third quarter of 2025. As part of the 2025 GAAP AAR, for our ULSG business, we updated assumptions regarding policyholder behavior, including mortality, premium persistency, lapses and withdrawals. In addition, we increased the long-term general account earned rate, driven by an increase in the mean reversion rate, from 4.00% to 4.50%. For our variable annuity business, we updated assumptions regarding annuitization, mortality, guaranteed principal option utilization, lapses and withdrawals, as well as separate account assumptions, including fund fees and allocations. For the payout annuity business, we updated assumptions regarding mortality. For term participating and non-participating whole life insurance, we updated assumptions regarding mortality and lapses.
As part of the 2024 GAAP AAR, for our ULSG business, we increased the long-term general account earned rate, driven by an increase in the mean reversion rate, from 3.75% to 4.00%. Also, with respect to our ULSG business, we updated assumptions regarding policyholder behavior, including mortality, premium persistency, lapses and withdrawals. For our variable annuity business, we updated assumptions regarding annuitization, mortality, lapses and withdrawals, as well as separate account assumptions, including fund fees and allocations. For term participating and non-participating whole life insurance, we updated assumptions regarding mortality and lapses.
We conducted our 2025 statutory AAR in the fourth quarter, the results of which will be included in our insurance subsidiaries’ 2025 annual statutory financial statements. The 2025 statutory AAR resulted in an increase to our statutory reserves; however, our 2025 preliminary Combined RBC Ratio was 456%, above our target range of 400% to 450% in normal market conditions, without contributing capital to our insurance subsidiaries. See “Risk Factors — Risks Related to Our Business — Differences between actual experience and actuarial assumptions may adversely affect our financial results, capitalization and financial condition.”
The impact on income (loss) available to shareholders before provision for income tax was as follows:
| Years Ended December 31, | ||
|---|---|---|
| 2025 | 2024 | |
| (In millions) | ||
| Market risk benefits | $(488) | $42 |
| Embedded derivatives | (82) | 69 |
| Total market risk benefits and embedded derivatives | (570) | 111 |
| Included in pre-tax adjusted earnings (loss): | ||
| Other annuity business | (9) | 26 |
| Life business | 14 | (83) |
| Run-off | 965 | 359 |
| Total included in pre-tax adjusted earnings (loss) | 970 | 302 |
| Total impact on income (loss) available to shareholders before provision for income tax | $400 | $413 |
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