

Description	Anticipated Date of Adoption	Effect on the Consolidated Financial Statements
Standards not yet adopted:
Financial Services – Insurance This guidance significantly changes how insurers account for long-duration insurance contracts. The new guidance also significantly expands the disclosure requirements of long-duration insurance contracts. The new guidance is currently effective for annual and interim reporting periods beginning January 1, 2022. The FASB has agreed to defer the effective date by one year. Upon issuance of a final standard, the new guidance will be effective for annual and interim periods beginning January 1, 2023. Below are the most significant areas of change:	January 1, 2023	See each significant area of change below for the method of adoption and expected impact to the Company’s results of operations and financial position.
Cash flow assumptions for measuring liability for future policy benefits The new guidance requires insurers to review, and if necessary, update the cash flow assumptions used to measure liabilities for future policy benefits periodically. The change in the liability estimate as a result of updating cash flow assumptions will be recognized in net income.		Cash flow assumptions for measuring liability for future policy benefits The Company will likely adopt this guidance on a modified retrospective basis as of the earliest period presented in the year of adoption. The Company is currently evaluating the impact of this amendment on its results of operations and financial position but anticipates the updated guidance will likely have a material impact.
Discount rate assumption for measuring liability for future policy benefits The new guidance requires insurers to update the discount rate assumption used to measure liabilities for future policy benefits at each reporting period, and the discount rate utilized must be based on an upper-medium grade fixed income instrument yield. The change in the liability estimate as a result of updating the discount rate assumption will be recognized in other comprehensive income.		Discount rate assumption for measuring liability for future policy benefits The Company will likely adopt this guidance on a modified retrospective basis as of the earliest period presented in the year of adoption. The Company is currently evaluating the impact of this amendment on its results of operations and financial position but anticipates the updated guidance will likely have a material impact.
Market risk benefits The new guidance created a new category of benefit features called market risk benefits that will be measured at fair value with changes in fair value attributable to a change in the instrument-specific credit risk recognized in other comprehensive income.		Market risk benefits The Company will adopt this guidance on a retrospective basis as of the earliest period presented in the year of adoption. The Company is currently evaluating the impact of this amendment on its results of operations and financial position but anticipates the updated guidance will likely have a material impact.
Amortization of deferred acquisition costs (“DAC”) and other balancesThe new guidance requires DAC and other balances to be amortized on a constant level basis over the expected term of the related contracts.		Amortization of deferred acquisition costs (“DAC”) and other balances The Company will likely adopt this guidance on a modified retrospective basis as of the earliest period presented in the year of adoption. The Company is currently evaluating the impact of this amendment on its results of operations and financial position but anticipates the updated guidance will likely have a material impact.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Cautionary Note Regarding Forward-Looking Statements

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including, among others, statements relating to projections of the future operations, strategies, earnings, revenues, income or loss, ratios, financial performance and growth potential of the Company. Forward-looking statements often contain words and phrases such as “intend,” “expect,” “project,” “estimate,” “predict,” “anticipate,” “should,” “believe” and other similar expressions. Forward-looking statements are based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company. Forward-looking statements are not a guarantee of future performance and are subject to risks and uncertainties, some of which cannot be predicted or quantified. Future events and actual results, performance, and achievements could differ materially from those set forth in, contemplated by or underlying the forward-looking statements.

The effects of the ~~ongoing novel coronavirus (“COVID-19”)~~COVID-19 pandemic and the response thereto on economic conditions, the financial markets and insurance risks, and the resulting effects on the Company’s financial results, liquidity, capital resources, financial metrics, investment portfolio and stock price, could cause actual results and events to differ materially from those expressed or implied by forward-looking statements. Further, any estimates, projections, illustrative scenarios or frameworks used to plan for potential effects of the pandemic are dependent on numerous underlying assumptions and estimates that may not materialize. Additionally, numerous other important factors (whether related to, resulting from or exacerbated by the COVID-19 pandemic or otherwise) could also cause ~~actual~~ results and events to differ materially from those expressed or implied by forward-looking statements, including, without limitation: (1) adverse changes in mortality, morbidity, lapsation or claims experience, (2) inadequate risk analysis and underwriting, (3) adverse capital and credit market conditions and their impact on the Company’s liquidity, access to capital and cost of capital, (4) changes in the Company’s financial strength and credit ratings and the effect of such changes on the Company’s future results of operations and financial condition, (5) the availability and cost of collateral necessary for regulatory reserves and capital, (6) requirements to post collateral or make payments due to declines in market value of assets subject to the Company’s collateral arrangements, (7) action by regulators who have authority over the Company’s reinsurance operations in the jurisdictions in which it operates, (8) the effect of the Company parent’s status as an insurance holding company and regulatory restrictions on its ability to pay principal of and interest on its debt obligations, (9) general economic conditions or a prolonged economic downturn affecting the demand for insurance and reinsurance in the Company’s current and planned markets, (10) the impairment of other financial institutions and its effect on the Company’s business, (11) fluctuations in U.S. or foreign currency exchange rates, interest rates, or securities and real estate markets, (12) market or economic conditions that adversely affect the value of the Company’s investment securities or result in the impairment of all or a portion of the value of certain of the Company’s investment securities, that in turn could affect regulatory capital, (13) market or economic conditions that adversely affect the Company’s ability to make timely sales of investment securities, (14) risks inherent in the Company’s risk management and investment strategy, including changes in investment portfolio yields due to interest rate or credit quality changes, (15) the fact that the determination of allowances and impairments taken on the Company’s investments is highly subjective, (16) the stability of and actions by governments and economies in the markets in which the Company operates, including ongoing uncertainties regarding the amount of U.S. sovereign debt and the credit ratings thereof, (17) the Company’s dependence on third parties, including those insurance companies and reinsurers to which the Company cedes some reinsurance, third-party investment managers and others, (18) financial performance of the Company’s clients, (19) the threat of natural disasters, catastrophes, terrorist attacks, epidemics or pandemics anywhere in the world where the Company or its clients do business, (20) competitive factors and competitors’ responses to the Company’s initiatives, (21) development and introduction of new products and distribution opportunities, (22) execution of the Company’s entry into new markets, (23) integration of acquired blocks of business and entities, (24) interruption or failure of the Company’s telecommunication, information technology or other operational systems, or the Company’s failure to maintain adequate security to protect the confidentiality or privacy of personal or sensitive data and intellectual property stored on such systems, (25) adverse litigation or arbitration results, (26) the adequacy of reserves, resources and accurate information relating to settlements, awards and terminated and discontinued lines of business, (27) changes in laws, regulations, and accounting standards applicable to the Company or its business, (28) the effects of the Tax Cuts and Jobs Act of 2017 may be different than expected and (29) other risks and uncertainties described in this document and in the Company’s other filings with the Securities and Exchange Commission (“SEC”).

Forward-looking statements should be evaluated together with the many risks and uncertainties that affect the Company’s business, including those mentioned in this document and described in the periodic reports the Company files with the SEC. These forward-looking statements speak only as of the date on which they are made. The Company does not undertake any obligation to update these forward-looking statements, even though the Company’s situation may change in the future. For a discussion of these risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements, you are advised to see Item 1A – “Risk Factors” in the ~~2019~~2020 Annual Report, as may be supplemented by Item 1A – “Risk Factors” in the Company’s subsequent Quarterly Reports on Form 10-Q.

4539

Table of Contents

Overview

The Company is among the leading global providers of life reinsurance and financial solutions, with $3.4 trillion of life reinsurance in force and assets of ~~$82.1~~$91.4 billion as of September 30, ~~2020.~~2021. Traditional reinsurance includes individual and group life and health, disability, and critical illness reinsurance. Financial solutions includes longevity reinsurance, asset-intensive reinsurance, capital solutions, including financial reinsurance, and stable value products. The Company derives revenues primarily from renewal premiums from existing reinsurance treaties, new business premiums from existing or new reinsurance treaties, fee income from financial solutions business and income earned on invested assets.

Historically, the Company’s primary business has been traditional life reinsurance, which involves reinsuring life insurance policies that are often in force for the remaining lifetime of the underlying individuals insured, with premiums earned typically over a period of 10 to 30 years. To a lesser extent, the Company also reinsures health business typically reinsured for one to three years. Each year, however, a portion of the business under existing treaties terminates due to, among other things, lapses or voluntary surrenders of underlying policies, deaths of insureds, and the exercise of recapture options by ceding companies. The Company has expanded its financial solutions business, including significant asset-intensive and longevity risk transactions, which allow its clients to take advantage of growth opportunities and manage their capital, longevity and investment risk.

~~For its traditional business, the~~The Company’s long-term profitability largely depends on the volume and amount of ~~death-and~~death- and health-related claims incurred and the ability to adequately price the risks it assumes. While death claims are reasonably predictable over a period of many years, claims become less predictable over shorter periods and are subject to significant fluctuation from quarter to quarter and year to year. For longevity business, the Company’s profitability depends on the lifespan of the underlying contract holders and the investment performance for certain contracts. Additionally, the Company generates profits on investment spreads associated with the reinsurance of investment type contracts and generates fees from ~~capital solutions transactions, such as~~ financial reinsurance transactions, which are typically shorter duration than its traditional life reinsurance business. The Company believes its sources of liquidity are sufficient to cover potential claims payments on both a short-term and long-term basis.

As is customary in the reinsurance business, clients continually update, refine, and revise reinsurance information provided to the Company. Such revised information is used by the Company in preparation of its condensed consolidated financial statements and the financial effects resulting from the incorporation of revised data are reflected in the current period.

~~The COVID-19 Pandemic Impact and Update~~

The ongoing COVID-19 global pandemic continues to cause increases in mortality, morbidity and other insurance risks, as well as significant disruption in the international and U.S. economies and financial markets. The extent to which the Company’s future results continue to be affected by COVID-19 will largely depend on, among other factors, country-specific circumstances, measures by public and private institutions, COVID-19’s impact on all other causes of death and the timing of effective treatments and/or a vaccine for COVID-19. Given these many variables, the Company cannot reliably predict the future impact of the pandemic on its business, results of operations and financial condition. In addition, clients’ ability to write new business in this environment may result in a slowdown in the Company’s new business temporarily; however, much of the Company’s premiums and other revenues are contractually recurring for many years to come.

One of the Company’s priorities continues to be the safety and well-being of its employees and clients, as such its business continuity plans are still activated and the actions taken to protect both employees and clients, such as working from home, restricting travel, conducting meetings remotely, and reinforcing the importance of face coverings, good hygiene and social distancing, also continue. The Company’s offices worldwide are at a minimum adhering to local government mandates and guidelines regarding occupancy levels; however, in certain situations the Company’s guidelines are more restrictive than those of local governments.

The Company has not currently experienced any significant disruptions to its daily operations, despite most of its workforce working remotely. Expenses incurred to implement its business continuity plans, including work from home arrangements, are not material and have been more than offset by reduced travel and other expenses during the three and nine months ended September 30, 2020. However, COVID-19 may heighten operational risks and related impacts, which may include a reduction in new business volumes from slower sales, impacts to the Company’s workforce productivity due to travel restrictions, temporary office closures and increased remote working situations, and potential client delays in paying premiums and reporting claims. The Company is heavily reliant on timely reporting from its clients and other third parties. While operational risks, including privacy and cybersecurity risks, are heightened during remote working situations the Company has implemented increased communication and training related to these risks to all its workforce and continues to monitor its programs, processes and procedures designed to manage these risks.

An infectious pandemic will negatively impact the profitability of the Company’s life and health business due to increased claims; however, given the many variables and uncertainties in the amounts and timing of claims, the Company is unable to reliably predict the ultimate claims it will experience as a result of the pandemic. However, ~~the Company’s longevity business is expected to act as a modest offset to excess life insurance claims.~~ ~~These variables and uncertainties include age, gender, comorbidities, other~~

~~Table of Contents~~

insured versus general population characteristics, geography-specific institutional and individual mitigating actions, medical capacity, and other factors. To date, general population COVID-19 deaths have been heavily concentrated in individuals aged 70 and older and with pre-existing comorbidities. The Company’s insured population has lower exposure to older ages than the general population and covers a generally healthier population due to underwriting and socioeconomic factors of those purchasing insurance.

The Company’s COVID-19 projection and financial impact models continue to be updated and refined based on updated external data and the Company’s claim experience to date and are subject to the many variables and uncertainties noted above. The financial impact of COVID-19 on the Company is currently projected to be at the low end of previous estimates for the same level of general population deaths as there continues to be significant differences between general and insured population mortality. The U.S. is the key driver of mortality claim costs, followed by the UK and Canada. For the nine months ended September 30, 2020, the Company estimates it has incurred approximately $440 million of COVID-19 related life and health claim costs, including amounts incurred but not reported, with approximately $340 million of that amount being associated with U.S. Individual Mortality. The Company estimates that every additional 10,000 population deaths in the U.S., UK or Canada as a result of COVID-19 would result in the following corresponding excess mortality claims of approximately:

~~$15 million to $25 million in the U.S.,~~

~~$4 million to $6 million in the UK, and~~

~~$10 million to 15 million in Canada.~~

The global financial markets continue to be in a state of uncertainty due to COVID-19 mandated economic shutdowns and historically large and rapid central bank and fiscal policies meant to offset the economic impact of the pandemic. The economic weakness and uncertainty caused by these events may also adversely affect the Company’s financial performance. All investments held by the Company, directly or in a funds withheld at interest reinsurance arrangement, are monitored for conformance with the Company’s stated investment policy limits as well as any limits prescribed by the applicable jurisdiction’s insurance laws and regulations. The current market environment may result in certain investments being downgraded which can affect conformance with these limits. The level of potential impairments will depend on broad economic conditions and the pace at which global economies recover from the effects of COVID-19. In addition, the Company may experience a short-term decrease in cash flows from its commercial mortgage loan portfolio as it assists borrowers that are affected by the current economic environment. See “Investments” for more information.

The Company’s liquidity is monitored and managed on a daily basis to ensure all current and future liquidity demands can be met, and that it maintains access to liquidity resources to meet even extreme tail risk liquidity needs. In addition, RGA maintains a number of arm’s length arrangements for mobilizing liquidity throughout the group. Liquidity has been enhanced by holding more cash received in the course of its normal operating and investing activities. The Company also suspended common stock repurchases until further notice.

~~Key liquidity resources available to the group include:~~

~~Holdings of cash and cash equivalents of $3.3 billion as of September 30, 2020,~~

~~Cash flows from investments, which is approximately $2 billion per year,~~

~~Access to $850 million of cash through the Company’s committed syndicated credit facility, and~~

~~Access to over $500 million of cash through the membership in the Federal Home Loan Bank of Des Moines.~~

In order to further enhance its capital and liquidity position, the Company executed two capital market transactions during the year. On June 5, 2020, the Company completed an offering of its common stock and received net proceeds of approximately $481 million. On June 9, 2020, the Company completed the offering of $600 million aggregate principal amount of its 3.150% Senior Notes due 2030 (the “Senior Notes”), which will be used to repay the $400 million 5.000% senior notes due 2021 and for general corporate purposes. The public offering price of the Senior Notes was 99.472% of the principal amount, and the Company received net proceeds of approximately $593 million.

~~Additional sources of liquidity for RGA’s operating subsidiaries include near-term reinsurance cash flows, sales of invested assets, and potentially other forms of borrowing.~~

RGA’s operating subsidiaries continue to be well capitalized and the Company continues to monitor its solvency position under multiple capital regimes on a regular basis while considering both its developing experience and economic conditions. In addition, the Company utilizes its internal capital model to assess its ability to meet its long-term obligations under a range of stress scenarios on a consolidated basis. This internal capital model is also used as the capital basis for RGA’s consolidated Own Risk and Solvency Assessment.

The Company’s primary insurance subsidiaries’ financial strength ratings are strong, with all having an S&P rating of AA-, and some of those also having a Moody’s rating of A1, and an A.M. Best rating of A+. In addition, even though the insurance subsidiaries’

~~Table of Contents~~

various capital ratios and solvency measures may be somewhat weakened due to the COVID-19 pandemic and the economic environment, RGA believes its various subsidiaries would remain financially solvent under such a pandemic scenario. Reinsurance treaties, whether facultative or automatic, generally provide recapture provisions. Most U.S. based reinsurance treaties include a recapture right for ceding companies, generally after 10 years. Outside of the U.S., treaties primarily include a mutually agreed-upon recapture provision. Recapture rights permit the ceding company to reassume all or a portion of the risk formerly ceded to the reinsurer. In some situations, the Company has the right to place assets in trust for the benefit of the ceding company in lieu of recapture. Additionally, certain treaties may grant recapture rights to ceding companies in the event of a significant decrease in RGA Reinsurance Company’s NAIC risk based capital ratio or financial strength rating. The RBC ratio trigger varies by treaty, with the majority between 125% and 225% of the NAIC’s company action level. Financial strength rating triggers vary by reinsurance treaty with the majority of the triggers reached if the specific legal entity’s financial strength rating falls five notches from its current rating of “AA-” to the “BBB” level on the S&P scale. Similar solvency and ratings based on recapture rights exist on treaties with other operating companies. Recapture of business previously ceded does not affect premiums ceded prior to the recapture of such business but would reduce premiums and insurance liabilities in subsequent periods. Upon recapture, the Company would reflect a net gain or loss on the settlement of the assets and liabilities associated with the reinsurance treaty. In some cases, the ceding company is required to pay the Company a recapture fee.

Globally, regulators continue to closely monitor the COVID-19 pandemic and its possible impact on the insurance industry. Various regulators and other authorities have been requiring regulated entities to review their business continuity plans and to address potential pandemic risk in their contingency plans. In addition, some regulators have adopted or are considering adopting measures to provide temporary relief in respect to certain regulatory requirements and also to policyholders. These regulatory initiatives have accompanied a range of measures by governments and central banks, such as interest rate cuts and other measures, in a number of jurisdictions to support and stimulate the economy. The Company expects that regulators and other authorities will continue monitoring the spread and effects of COVID-19 closely and adapt their guidance and additional requirements.

Segment Presentation

The Company has geographic-based and business-based operational segments. Geographic-based operations are further segmented into traditional and financial solutions businesses. The Company allocates capital to its segments based on an internally developed economic capital model, the purpose of which is to measure the risk in the business and to provide a consistent basis upon which capital is deployed. The economic capital model considers the unique and specific nature of the risks inherent in RGA’s businesses.

As a result of the economic capital allocation process, a portion of investment income is credited to the segments based on the level of allocated capital. In addition, the segments are charged for excess capital utilized above the allocated economic capital basis. This charge is included in policy acquisition costs and other insurance expenses. Segment investment performance varies with the composition of investments and the relative allocation of capital to the operating segments.

Segment revenue levels can be significantly influenced by currency fluctuations, large transactions, mix of business and reporting practices of ceding companies, and therefore may fluctuate from period to period. Although reasonably predictable over a period of years, segment claims experience can be volatile over shorter periods. See “Results of Operations by Segment” below for further information about the Company’s segments.

Table of Contents

Critical Accounting Policies

The preparation of financial statements in conformity with GAAP requires the application of accounting policies that often involve a significant degree of judgment. Management, on an ongoing basis, reviews estimates and assumptions used in the preparation of financial statements. If management determines that modifications in assumptions and estimates are appropriate given current facts and circumstances, results of operations and financial position as reported in the condensed consolidated financial statements could change significantly.

Management believes the critical accounting policies relating to the following areas are most dependent on the application of estimates and assumptions:

Premiums receivable;

Deferred acquisition costs;

Liabilities for future policy benefits and incurred but not reported claims;

Valuation of investments, allowance for credit losses and impairments to specific investments;

Valuation of embedded derivatives; and

Income taxes.

A discussion of each of the critical accounting policies may be found in the Company’s ~~2019~~2020 Annual Report under “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies.”

Consolidated Results of Operations

Impacts of the COVID-19 Pandemic

Three months ended September 30, Nine months ended September 30,
2020 2019 2020 2019
Revenues: (Dollars in millions, except per share data)
Net premiums $ 2,825
$ 2,809
$ 8,434
$ 8,311
Investment income, net of related expenses 654
679
1,893
1,843
Investment related gains (losses), net:
Impairments and change in allowance for credit losses on fixed maturity securities 13
(9 ) (21 ) (18 )
Other investment related gains (losses), net 53
58
(117 ) 87
Investment related gains (losses), net 66
49
(138 ) 69
Other revenues 98
91
264
292
Total revenues 3,643
3,628
10,453
10,515
Benefits and Expenses:
Claims and other policy benefits 2,530
2,470
7,894
7,494
Interest credited 196
226
529
517
Policy acquisition costs and other insurance expenses 374
322
912
894
Other operating expenses 211
210
594
634
Interest expense 43
46
126
129
Collateral finance and securitization expense 4
7
14
23
Total benefits and expenses 3,358
3,281
10,069
9,691
Income before income taxes
285
347
384
824
Provision for income taxes 72
84
101
189
Net income $ 213
$ 263
$ 283
$ 635
Earnings per share:
Basic earnings per share $ 3.13
$ 4.19
$ 4.39
$ 10.13
Diluted earnings per share $ 3.12
$ 4.12
$ 4.36
$ 9.93
The COVID-19 global pandemic continues to cause increases in the Company’s claims costs, primarily relating to its mortality business. However, the Company cannot reliably predict the future impact of the pandemic on its business, results of operations and financial condition as the impact will largely depend on, among other factors, the impact of new variants of the virus, vaccination levels globally, country-specific circumstances, measures by public and private institutions, and COVID-19’s impact on all other causes of death.

~~Consolidated income before income taxes decreased $62 million,~~The ultimate amount and ~~$440 million, for~~timing of claims the ~~three~~Company will experience as a result of the COVID-19 pandemic will be dependent on many variables and uncertainties. These variables and uncertainties include those discussed above, in addition to age, gender, comorbidities, other insured versus general population characteristics, geography-specific institutional and individual mitigating actions, medical capacity, and other factors. To date, general population COVID-19 deaths have been heavily concentrated in individuals aged 70 and older and with pre-existing comorbidities; however, more recently, many populations have seen an increase in younger age deaths, particularly in areas where healthcare facilities were unable to provide adequate care. The Company’s insured population has lower exposure to older ages than the general population and covers a generally healthier population due to underwriting and socioeconomic factors of those purchasing insurance. In addition, the Company’s longevity business may act as a modest offset to excess life insurance claims at older ages.

The Company’s COVID-19 projection and financial impact models continue to be updated and refined based on updated external data and the Company’s claim experience to date and are subject to the many variables and uncertainties noted above. The U.S. is the key driver of mortality claim costs followed by India, South Africa, the UK and Canada. For the nine ~~months~~month period ended September 30, 2020, respectively, as compared to the same periods in 2019. The decrease in income for the third quarter of 2020 was primarily the result of increased mortality claims in the U.S. and Latin America, Canada and Europe, Middle East and Africa (“EMEA”) Traditional segments, some of which are primarily attributable to the COVID-19 pandemic. The unfavorable mortality claims were partially offset by favorable claim experience in the Asia Pacific Traditional segment and an increase in income before taxes in the Company’s Financial Solutions business. The decrease in income for the first nine months of 2020 was primarily due to unfavorable claim experience across all Traditional segments and lower variable investment; partially offset by an increase in income before taxes in the Company’s Financial Solutions business. In addition to an increase in mortality claims in the U.S. and

~~Table of Contents~~

Latin America Traditional segment, income for the first nine months of 2020 reflects unfavorable changes in investment related gain (losses) resulting from changes in the fair value of embedded derivatives on modco or funds withheld treaties within the U.S. segment due to changes in interest rates and credit spreads primarily attributable to the disruption and volatility in the global financial markets caused by COVID-19. The effects of the change in fair value of these embedded derivatives on income is discussed below. As discussed in “The COVID-19 Impact and Update” above,2021, the Company estimates it has incurred approximately ~~$440 million~~$1.1 billion of COVID-19 related life and health claim costs, including amounts incurred but not reported, with approximately ~~$340~~$593 million of that amount being associated with the U.S. ~~Individual Mortality.~~and Latin America Traditional segment. The Company ~~did~~has maintained the range of COVID-19 mortality claim cost estimates relative to the level of general population deaths for the U.S., the UK and Canada. The Company estimates that every additional 10,000 population deaths in the U.S., UK, or Canada as a result of COVID-19 would result in the following corresponding excess mortality claims of approximately

•$10 million to $20 million in the U.S.;

•$4 million to $8 million in the UK; and

•$10 million to $20 million in Canada.

The global financial markets have stabilized since the beginning of the pandemic; however, they continue to be in a state of uncertainty due to COVID-19, including supply chain issues and the impact of historically large and rapid central bank actions and fiscal policies meant to offset the economic impact of the pandemic. The economic uncertainty caused by these events may also adversely affect the Company’s financial performance. All investments held by the Company, directly or in a funds withheld at interest reinsurance arrangement are monitored for conformance with the Company’s stated investment policy limits

Table of Contents

as well as any limits prescribed by the applicable jurisdiction’s insurance laws and regulations. The current market environment may result in certain investments being downgraded which can affect conformance with these limits. The level of potential impairments will depend on broad economic conditions and the pace at which global economies recover from the effects of COVID-19 and the response thereto. See “Investments” for more information.

The safety and well-being of the Company’s employees and clients continues to be a priority. The Company’s business continuity plans remain activated and the actions taken during 2020 to protect both employees and clients, such as working from home, restricting travel, conducting meetings remotely, and reinforcing the importance of face coverings, good hygiene and social distancing, also largely continue. The Company’s offices worldwide are at a minimum adhering to local government mandates and guidelines regarding occupancy levels; however, in certain situations the Company’s guidelines are more restrictive than those of local governments.

The Company has not experienced any significant disruptions to its daily operations, despite most of its workforce working remotely. However, COVID-19 heightened operational risks and related impacts, which may include impacts to the Company’s workforce productivity due to travel restrictions, temporary office closures and increased remote working situations, and potential client delays in paying premiums and reporting claims. Similar to other reinsurers, the Company is heavily reliant on timely reporting from its clients and other third parties. The Company continues to emphasize awareness and training regarding operational risks, including privacy and cybersecurity risks, as such risks are heightened during remote working situations. In addition, the Company continues to monitor its programs, processes and procedures designed to manage these risks.

RGA’s operating subsidiaries continue to be well capitalized, and the Company continues to monitor its solvency position under multiple capital regimes on a regular basis while considering both its developing experience and economic conditions. In addition, the Company utilizes its internal capital model to assess its ability to meet its long-term obligations under a ~~higher incidence~~range of ~~older age death~~stress scenarios on a consolidated basis. This internal capital model is also used as the capital basis for RGA’s consolidated Own Risk and Solvency Assessment.

Results from Operations – 2021 compared to 2020

The following table summarizes net income for the periods presented.


	Three months ended September 30,						Nine months ended September 30,
	2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Revenues:	(Dollars in millions, except per share data)
Net premiums	$	3,094	$	2,825	$	269	$	9,106	$	8,434	$	672
Investment income, net of related expenses	796		654		142		2,367		1,893		474




Investment related gains (losses), net	58		66		(8)		472		(138)		610
Other revenues	95		98		(3)		354		264		90
Total revenues	4,043		3,643		400		12,299		10,453		1,846
Benefits and Expenses:
Claims and other policy benefits	3,289		2,530		759		9,294		7,894		1,400
Interest credited	177		196		(19)		541		529		12
Policy acquisition costs and other insurance expenses	338		374		(36)		1,010		912		98
Other operating expenses	229		211		18		683		594		89
Interest expense	41		43		(2)		129		126		3
Collateral finance and securitization expense	3		4		(1)		8		14		(6)
Total benefits and expenses	4,077		3,358		719		11,665		10,069		1,596
Income before income taxes	(34)		285		(319)		634		384		250
Provision for income taxes	(12)		72		(84)		173		101		72
Net income	$	(22)	$	213	$	(235)	$	461	$	283	$	178
Earnings per share:
Basic earnings per share	$	(0.32)	$	3.13	$	(3.45)	$	6.78	$	4.39	$	2.39
Diluted earnings per share	$	(0.32)	$	3.12	$	(3.44)	$	6.74	$	4.36	$	2.38

Three months ended September 30, 2021 compared to three months ended September 30, 2020

The decrease in income for the three months ended September 30, 2021, was primarily the result of:

•Increased mortality claims in the U.S. and Latin America, EMEA, and Asia Pacific traditional segments, primarily attributable to the COVID-19 pandemic.

Table of Contents

•The unfavorable mortality claims were partially offset by an increase in income before taxes generated by the Company’s Financial Solutions business in the U.S. and UK and an increase in investment income and investment related gains (losses), net primarily due to an increase in variable investment income.

Nine months ended September 30, 2021 compared to nine months ended September 30, 2020

The increase in income for the nine months ended September 30, 2021, was primarily the result of:

•A one-time adjustment of $162 million, pretax, associated with prior periods that includes $92 million, pretax, to correct the accounting for equity method limited partnerships to reflect unrealized gains in investment income, net of related expenses that were previously included in accumulated other comprehensive income, and a $70 million, pretax, correction reflected in other investment related gains (losses), net to adjust the carrying value of certain limited partnerships from cost less impairments to a fair value approach, using the net asset value (“NAV”) per share or its equivalent.

•$213 million, pretax, of capital gains included in other investment related gains (losses), net associated with portfolio repositioning.

•Changes in fair value of embedded derivatives, associated with modco/funds withheld treaties, increased investment related gains of $87 million for the nine month period ended September 30, 2021, compared to a decrease of $113 million for the nine month period ended September 30, 2020.

•As discussed in the “Impacts of the COVID-19 Pandemic” above, the Company estimates it has incurred approximately $1.1 billion, pretax, of COVID-19 related life and health claim costs, including amounts incurred but not reported, with approximately $593 million, pretax, in the U.S. and Latin America segment.

Foreign currency fluctuations can result in variances in financial statement line items. Foreign currency (decreased) and increased income before taxes for the three and nine month periods ended September 30, 2021, by $(5) million and $13 million, respectively, primarily due to the strengthening of the Great British Pound, Canadian Dollar and South African Rand compared to the U.S. Dollar.

Premiums and business growth

The increase in premiums during the three and nine ~~months~~month period ended September 30, ~~2020, while the cause of death information~~2021, is not yet available for all claims, the Company’s analysis attributes excess claim costs primarily to COVID-19 or COVID-19 related factors and therefore additional analysis and information from clients will allow the Company to refine the impact of COVID-19 on current quarter and year to date results. Foreign currency fluctuations relative to the prior year increased income before income taxes by $7 million in the third quarter and increased income by $5 million in the first nine months of 2020, as compared to the same periods in 2019.

~~Consolidated net premiums increased $16 million, or less than 1.0%, and $123 million, or 1.5%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019,~~ primarily due to growth in life reinsurance in force. Foreign currency fluctuations increased net premiums by $11 million and decreased net premiums by $67 million in the third quarter and the first nine months of 2020, as compared to the same periods in 2019. Consolidated assumed life insurance in force increased to $3,468.6 billion as of September 30, 2021, from $3,369.6 billion as of September 30, 2020, ~~from $3,359.8 billion as of September 30, 2019,~~ due to new business production and in force ~~transactions.~~transactions offset by an increase in lapses and mortality claims in the current period, primarily attributable to the increased claims as a result of the ongoing COVID-19 pandemic. The Company added new business production, measured by face amount of insurance in force, of ~~$68.3~~$305.4 billion, and ~~$98.3~~$279.2 billion during the ~~third quarter of 2020 and 2019, respectively, and $279.2 billion and $248.0 billion during the first~~ nine months ofended September 30, 2021 and 2020, ~~and 2019,~~ respectively.

~~Consolidated investment~~Investment income, net of related expenses ~~decreased $25 million, or 3.7%~~and investment related gains (losses), and increased $50 million, or 2.7%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decrease for the three month period ended September 30, 2020, is primarily the result of a decrease in variable investment income associated with joint venture and limited partnership investments and a decrease in yields in the current period as compared to the same period in the prior year. net

The increase in investment income, net of related expenses is primarily attributable to the aforementioned accounting correction associated with equity method limited partnerships recorded in the first ~~nine months is primarily attributable~~quarter of 2021, in addition to an increase in the average invested asset base. Investment income is affected by changes in the fair value of the Company’s funds withheld at interest assets associated with the reinsurance of certain equity-indexed annuity (“EIA”) products. base and yield:

•The re-measurement of these funds withheld assets decreased investment income by $5 million in the third quarter and decreased investment income by $25 million in the first nine months of 2020. The effect on investment income of the EIA's market value changes is substantially offset by a corresponding change in interest credited to policyholder account balances resulting in an insignificant effect on net income.

~~Average~~average invested assets at amortized cost, excluding spread ~~related~~ business, totaled $33.0 billion for the nine months ended September 30, ~~2020, were~~2021, compared to $30.5 billion ~~an 8.0% increase over~~for the nine months ended September 30, ~~2019.~~ 2020.

•The average yield earned on investments, excluding spread related business, was ~~3.66%~~4.95% and ~~4.83%~~3.66% for the ~~third quarter of~~three month period ended September 30, 2021 and 2020, ~~and 2019,~~ respectively, and ~~3.93%~~5.08% and ~~4.57%~~3.93% for the nine months ended September 30, 2021 and 2020, respectively.

•Excluding the aforementioned correction, variable investment income was $150 million and ~~2019,~~$27 million for the nine months ended September 30, 2021 and 2020, respectively. The average yield will vary from quarter to quarter and year to year depending on a number of variables, including the prevailing interest rate and credit spread environment, prepayment fees, make-whole premiums and changes in the mix of the underlying investments and cash balances, and the timing of dividends and distributions on certain investments.

A continued low interest rate environment, in addition to higher cash and cash equivalents balances held by the Company during the COVID-19 pandemic, is expected to put downward pressure on this yield in future reporting ~~periods~~periods. The average yield will vary from year to year depending on several variables, including the prevailing risk-fee interest rate and credit spread environment, prepayment fees and make-whole premiums, changes in ~~addition~~the mix of the underlying investments and cash and cash equivalents balances. Variable investment income from joint ventures and limited partnerships, including unrealized gains and losses on certain limited partnerships, will also vary from year to ~~higher cash balances held by~~year and can be highly variable based on equity-market performance and the ~~Company during~~timing of dividends and distributions on certain investments. Investment income is allocated to the ~~COVID-19 pandemic.~~operating segments based upon average assets and related capital levels deemed appropriate to support segment operations.

~~Total~~The increase in investment related gains (losses), net ~~were $66~~is primarily attributable to the following:

Table of Contents

•During the three and nine months ended September 30, 2021, the Company repositioned its portfolio generating capital gains of $36 million and ~~$49~~$213 million, respectively.

•There were no material impairments or changes in allowance for credit losses on fixed maturities during the ~~third quarter~~three months ended September 30, 2021 or September 30, 2020. During the nine months ended September 30, 2021, the Company recognized an decrease $3 million of ~~2020~~impairments and ~~2019, respectively, and $(138)~~change in allowance for credit losses on fixed maturities compared to an increase of $40 million ~~and $69 million for~~during the first nine months of 2020 and 2019, respectively. A portion of investment related gains (losses) was offset by changes in the value of embedded derivatives related to reinsurance treaties written on a modco or funds withheld basis, reflecting the impact of changes in interest rates and credit spreads on the calculation of fair value, 2020.

•~~which fluctuated significantly during the year as a result of the economic uncertainty and market disruptions caused by the COVID-19 pandemic~~. Changes in the fair value of ~~these~~ embedded derivatives, associated with modco/funds withheld treaties, increased ~~(decreased)~~ investment related gains (losses), net by ~~$116~~$21 million and ~~$9 million for the third quarter of 2020 and 2019, respectively, and $(113) million and $12 million for the first nine months of 2020 and 2019, respectively.~~ The Company recognized $21 million of impairment losses and changes in the credit allowance for its available-for-sale fixed maturities for the nine months ended September 30, 2020, For the third quarter of 2020, the Company recognized a $13 million gain related to impairment losses and changes in the credit allowance for its available-for-sale fixed maturities as new allowances were offset by sales and improved fair values on previously impaired securities. The valuation allowance on mortgage loans increased by $8 million and $38$87 million for the three and nine month periods ended September 30, ~~2020, respectively. The~~2021, respectively, compared to an increase (decrease) of $116 million and $(113) million for the three and nine month periods ended September 30, 2020.

•Unrealized gains of $33 million and $197 million, including the previously mentioned correction recorded in the first quarter of 2021 of $70 million due to the change in ~~both~~fair value of certain cost method limited partnerships were recognized during the ~~credit allowance for available-for-sale fixed maturity securities~~three and ~~the valuation allowance on mortgage loans is primarily attributable to the economic uncertainty caused by COVID-19.~~nine month periods ended September 30, 2021. ~~See the Investment section within Management Discussion and Analysis, Note 4~~ – ~~“Investments” and Note 5~~ – ~~“Derivative Instruments” in the Notes to Condensed Consolidated Financial Statements for additional information on the impairment losses and derivatives.~~

~~Table of Contents~~

The effective tax rate on a consolidated basis was ~~25.5%~~34.3% and ~~24.3%~~25.5% for the ~~third quarter~~three months ended September 30, 2021 and 2020, ~~and 2019,~~ respectively, and ~~26.3%~~27.3% and ~~22.9%~~26.3% for the ~~first~~ nine months ofended September 30, 2021 and 2020, ~~and 2019,~~ respectively. See Note 9 – “Income Tax” in the Notes to Condensed Consolidated Financial Statements for additional information on the Company’s consolidated effective tax rates.

Impact of certain derivatives

The Company recognizes in consolidated income, any changes in the fair value of embedded derivatives on modco or funds withheld treaties, ~~EIA treaties~~equity index annuities (“EIAs”) and variable annuities with guaranteed minimum benefit riders. The Company utilizes freestanding derivatives to minimize the income statement volatility due to changes in the fair value of embedded derivatives associated with guaranteed minimum benefit riders. The following table presents the effect of embedded derivatives and related freestanding derivatives on income before income taxes for the periods indicated (dollars in millions):


	Three Months Ended September 30,						Nine Months Ended September 30,
	2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Modco/Funds withheld:
Unrealized gains (losses)	$	21	$	116	$	(95)	$	87	$	(113)	$	200
Deferred acquisition costs/retrocession	(8)		(65)		57		(31)		50		(81)
Net effect	13		51		(38)		56		(63)		119
EIAs:
Unrealized gains (losses)	4		(5)		9		36		(25)		61
Deferred acquisition costs/retrocession	(2)		—		(2)		(18)		10		(28)
Net effect	2		(5)		7		18		(15)		33
Guaranteed minimum benefit riders:
Unrealized gains (losses)	(37)		(29)		(8)		(36)		(50)		14
Related freestanding derivatives, net of deferred acquisition costs/retrocession	5		(30)		35		(28)		63		(91)
Net effect	(32)		(59)		27		(64)		13		(77)
Total net effect after freestanding derivatives	$	(17)	$	(13)	$	(4)	$	10	$	(65)	$	75

Three months ended September 30, Nine months ended September 30,
2020 2019 2020 2019
Modco/Funds withheld:
Unrealized gains (losses) $ 116
$ 9
$ (113 ) $ 12
Deferred acquisition costs/retrocession (65 ) (9 ) 50
(18 )
Net effect 51
—
(63 ) (6 )
EIAs:
Unrealized gains (losses) (5 ) (36 ) (25 ) (56 )
Deferred acquisition costs/retrocession —
17
10
27
Net effect (5 ) (19 ) (15 ) (29 )
Guaranteed minimum benefit riders:
Unrealized gains (losses) (29 ) (42 ) (50 ) (42 )
Related freestanding derivatives, net of deferred acquisition costs/retrocession (30 ) 39
63
41
Net effect (59 ) (3 ) 13
(1 )
Total net effect after freestanding derivatives $ (13 ) $ (22 ) $ (65 ) $ (36 )

Table of Contents

Results of Operations by Segment

U.S. and Latin America Operations

The U.S. and Latin America operations include business generated by ~~its~~the Company’s offices in the U.S., Mexico and Brazil. The offices in Mexico and Brazil provide services to clients in other Latin American countries. The U.S. and Latin America operations consist of two major segments: Traditional and Financial Solutions. The Traditional segment primarily specializes in the reinsurance of individual ~~mortality-risk,~~mortality risk, health and long-term care and to a lesser extent, group reinsurance. The Financial Solutions segment consists of Asset-Intensive and Capital Solutions. Asset-Intensive within the Financial Solutions segment includes coinsurance of annuities and corporate-owned life insurance policies and to a lesser extent, fee-based synthetic guaranteed investment contracts, which include investment-only, stable value ~~contracts and other longevity type products.~~ contracts. Capital Solutions within the Financial Solutions segment primarily involves assisting ceding companies in meeting applicable regulatory requirements by enhancing the ceding companies’ financial strength and regulatory surplus position through relatively low risk reinsurance and other transactions. Typically, these transactions do not qualify as reinsurance under GAAP, due to ~~their~~the low-risk nature ~~as such~~of the transactions, therefore only the related net fees are reflected in other revenues on the condensed consolidated statements of ~~income.~~income.

For the three months ended September 30, 2020: Financial Solutions
(dollars in millions) Asset-Intensive Capital Solutions Total U.S. and Latin America
Traditional
Revenues:
Net premiums $ 1,420
$ 13
$ —
$ 1,433
Investment income, net of related expenses 180
272
1
453
Investment related gains (losses), net (8 ) 59
—
51
Other revenues 7
26
28
61
Total revenues 1,599
370
29
1,998
Benefits and expenses:
Claims and other policy benefits 1,343
50
—
1,393
Interest credited 19
163
—
182
Policy acquisition costs and other insurance expenses 189
99
2
290
Other operating expenses 34
8
3
45
Total benefits and expenses 1,585
320
5
1,910
Income before income taxes $ 14
$ 50
$ 24
$ 88

For the three months ended September 30, 2019: Financial Solutions
(dollars in millions) Asset-Intensive Capital Solutions Total U.S. and Latin America
Traditional
Revenues:
Net premiums $ 1,404
$ 12
$ —
$ 1,416
Investment income, net of related expenses 210
254
1
465
Investment related gains (losses), net (10 ) 58
—
48
Other revenues 6
36
22
64
Total revenues 1,610
360
23
1,993
Benefits and expenses:
Claims and other policy benefits 1,241
49
—
1,290
Interest credited 20
183
—
203
Policy acquisition costs and other insurance expenses 201
21
—
222
Other operating expenses 35
7
4
46
Total benefits and expenses 1,497
260
4
1,761
Income before income taxes $ 113
$ 100
$ 19
$ 232

~~Table of Contents~~

For the nine months ended September 30, 2020: Financial Solutions
(dollars in millions) Asset-Intensive Capital Solutions Total U.S. and Latin America
Traditional
Revenues:
Net premiums $ 4,247
$ 40
$ —
$ 4,287
Investment income, net of related expenses 518
746
4
1,268
Investment related gains (losses), net (8 ) (86 ) —
(94 )
Other revenues 17
78
79
174
Total revenues 4,774
778
83
5,635
Benefits and expenses:
Claims and other policy benefits 4,268
152
—
4,420
Interest credited 56
431
—
487
Policy acquisition costs and other insurance expenses 559
68
4
631
Other operating expenses 97
22
8
127
Total benefits and expenses 4,980
673
12
5,665
Income before income taxes $ (206 ) $ 105
$ 71
$ (30 )

For the nine months ended September 30, 2019: Financial Solutions
(dollars in millions) Asset-Intensive Capital Solutions Total U.S. and Latin America
Traditional
Revenues:
Net premiums $ 4,171
$ 28
$ —
$ 4,199
Investment income, net of related expenses 569
655
3
1,227
Investment related gains (losses), net (20 ) 76
—
56
Other revenues 15
109
68
192
Total revenues 4,735
868
71
5,674
Benefits and expenses:
Claims and other policy benefits 3,834
146
—
3,980
Interest credited 59
396
—
455
Policy acquisition costs and other insurance expenses 557
65
5
627
Other operating expenses 105
24
9
138
Total benefits and expenses 4,555
631
14
5,200
Income before income taxes $ 180
$ 237
$ 57
$ 474

~~Income~~The following table summarizes income before income taxes ~~decreased by $144 million, and $504 million,~~ for the ~~three~~Company’s U.S. and ~~nine months ended September 30, 2020, as compared to~~Latin America operations for the ~~same~~ periods ~~in 2019.~~ presented:


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in millions)	2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Revenues:
Net premiums	$	1,564	$	1,433	$	131	$	4,589	$	4,287	$	302
Investment income, net of related expenses	536		453		83		1,510		1,268		242
Investment related gains (losses), net	7		51		(44)		38		(94)		132
Other revenues	62		61		1		236		174		62
Total revenues	2,169		1,998		171		6,373		5,635		738
Benefits and expenses:
Claims and other policy benefits	1,718		1,393		325		4,957		4,420		537
Interest credited	166		182		(16)		497		487		10
Policy acquisition costs and other insurance expenses	231		290		(59)		700		631		69
Other operating expenses	52		45		7		151		127		24
Total benefits and expenses	2,167		1,910		257		6,305		5,665		640
Income before income taxes	$	2	$	88	$	(86)	$	68	$	(30)	$	98

The decrease in income before income taxes in the third quarter of 2021 was the result of an increase in claims and other policy benefits in the U.S. Traditional segment, partially offset by higher variable investment income and strong performance from the segment’s Financial Solutions business related to both lower capital losses and income from new transactions. The increase in income before income taxes for the first nine months of 2021 is attributable primarily to higher variable investment income from investments in limited partnerships and real estate joint venture sales, the impact of embedded derivatives in the segment’s Financial Solutions business, and new Financial Solutions transactions. Partially offsetting the nine month increase were significantly higher claims in U.S. Mortality Markets. The significant increase in claims in the U.S. Mortality Markets during the third quarter and the first nine months compared to the same periods in 2020 was primarily related to ~~a significant~~an increase in large and non-large claim frequency within the individual mortality business. While the cause of death is not yet available for all claims, the Company believes the excess claim costs are primarily attributable to ~~COVID-19 or COVID-19 related factors as~~ COVID-19.

~~the Company did experience a higher incidence~~Table of older age death claims in the U.S. during the three months and nine months ended September 30, 2020, and the highest mortality ratios were in states with the highest general population COVID-19 deaths.Contents

Also, contributing to the three and nine months variance were lower investment related losses. For the nine months ended September 30, 2020, changes in the value of the embedded derivatives associated with reinsurance treaties structured on a modco or funds withheld basis also contributed to the variance. The volatility in the financial markets as a result of the COVID-19 pandemic, was the primary driver of this change.

Traditional Reinsurance

~~Income~~


	Three Months Ended September 30,								Nine Months Ended September 30,
(dollars in millions)	2021			2020			2021 vs 2020		2021			2020			2021 vs 2020
Revenues:
Net premiums	$	1,550		$	1,420		$	130	$	4,547		$	4,247		$	300
Investment income, net of related expenses	245			180			65		685			518			167
Investment related gains (losses), net	(5)			(8)			3		2			(8)			10
Other revenues	5			7			(2)		14			17			(3)
Total revenues	1,795			1,599			196		5,248			4,774			474
Benefits and expenses:
Claims and other policy benefits	1,670			1,343			327		4,828			4,268			560
Interest credited	17			19			(2)		52			56			(4)
Policy acquisition costs and other insurance expenses	195			189			6		583			559			24
Other operating expenses	39			34			5		114			97			17
Total benefits and expenses	1,921			1,585			336		5,577			4,980			597
Income (loss) before income taxes	$	(126)		$	14		$	(140)	$	(329)		$	(206)		$	(123)
Key metrics:
Life insurance in force									$1,619.9 billion			$1,602.1 billion
Claims and other policy benefits as a percentage of net premiums (“loss ratios”)	107.7		%	94.6		%			106.2		%	100.5		%
Policy acquisition costs and other insurance expenses as a percentage of net premiums	12.6		%	13.3		%			12.8		%	13.2		%
Other operating expenses as a percentage of net premiums	2.5		%	2.4		%			2.5		%	2.3		%

The decrease in income before income taxes in the third quarter and the first nine months for the U.S. and Latin America Traditional segment ~~decreased by $99 million, and $386 million, for~~was primarily the ~~three and nine months ended September 30, 2020, as compared~~result of an increase in claims in the U.S. Mortality Market primarily due to ~~the same periods in 2019. The decreases were primarily related to unfavorable individual mortality experience from a~~ higher ~~than expected count of claims. While the cause of death is not yet available for all~~ claims ~~the Company believes the excess claims~~which are ~~primarily~~likely attributable to COVID-19 or COVID-19 related ~~factors. In addition, the segment reported lower~~factors, partially offset by an increase in variable investment ~~income year over year.~~income.

~~Net~~Revenues

•The increase in net premiums ~~increased $16 million, or 1.1%, and $76 million, or 1.8%,~~ for the three and nine ~~months~~month periods ended September 30, ~~2020, as compared to the same periods in 2019. The increases in net premiums in the third quarter and first nine months were~~2021, was primarily due to organic growth as well as new sales. The segment added new ~~individual~~ life business production, measured by face amount of insurance in force, of $33.9 billion and $24.6 billion ~~and $23.9 billion for~~during the third quarter of 2021 and 2020, respectively, and $98.1 billion and $83.9 billion ~~and $77.4 billion for~~during the first nine months of 2021 and 2020, respectively. Also contributing to the premium growth was the restructure and ~~2019, respectively.~~extension of an existing transaction and the partial recapture of a retroceded block of individual life business.

~~Net~~•The increase in net investment income ~~decreased $30 million, or 14.3%,~~for the three and ~~$51 million, or 9.0%,~~nine month periods ended September 30, 2021, was primarily due to higher variable investment income associated with investments in limited partnerships and private equity funds primarily generated from both realized and unrealized gains in the underlying investments and higher variable investment income from real estate joint ventures.

Benefits and expenses

•The increase in the loss ratio for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same periods in 2019. The decrease in the third quarter and first nine months was primarily related to less variable investment income and lower overall yields. Investment related gains (losses), net increased $2 million and $12 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019 as result of changes in the fair value of embedded derivatives related to modified coinsurance and funds withheld treaties as a result of changes in interest rates and credit spreads.

Claims and other policy benefits as a percentage of net premiums (“loss ratios”) were 94.6% and 88.4% for the third quarter and 100.5% and 91.9%, for the nine months ended September 30, 2020 and 2019, respectively. The increase in the loss ratio for the third quarter was primarily due to ~~a high frequency of~~unfavorable large and non-large claims experience in the individual mortality line of ~~business.~~business, likely attributed to the COVID-19 pandemic. As explained above, while the cause of death is not yet available for all claims, the Company estimates that approximately ~~$100 million and $340~~$593 million of ~~individual mortality~~ excess claims for the nine months ended September 30, 2021, were attributable to COVID-19.

•The increase in other operating expenses for the three and nine months ended September 30, ~~2020, respectively, were attributable~~2021, was primarily due to ~~COVID-19~~an increase in incentive compensation expense.

Table of Contents

Financial Solutions


For the three months ended September 30,	2021						2020						2021 vs 2020
	Asset-Intensive		Capital Solutions		Total		Asset-Intensive		Capital Solutions		Total		Asset-Intensive		Capital Solutions		Total
(dollars in millions)
Revenues:
Net premiums	$	14	$	—	$	14	$	13	$	—	$	13	$	1	$	—	$	1
Investment income, net of related expenses	290		1		291		272		1		273		18		—		18
Investment related gains (losses), net	12		—		12		59		—		59		(47)		—		(47)
Other revenues	31		26		57		26		28		54		5		(2)		3
Total revenues	347		27		374		370		29		399		(23)		(2)		(25)
Benefits and expenses:
Claims and other policy benefits	48		—		48		50		—		50		(2)		—		(2)
Interest credited	149		—		149		163		—		163		(14)		—		(14)
Policy acquisition costs and other insurance expenses	34		2		36		99		2		101		(65)		—		(65)
Other operating expenses	10		3		13		8		3		11		2		—		2
Total benefits and expenses	241		5		246		320		5		325		(79)		—		(79)
Income before income taxes	$	106	$	22	$	128	$	50	$	24	$	74	$	56	$	(2)	$	54


For the nine months ended September 30,	2021						2020						2021 vs 2020
	Asset-Intensive		Capital Solutions		Total		Asset-Intensive		Capital Solutions		Total		Asset-Intensive		Capital Solutions		Total
(dollars in millions)
Revenues:
Net premiums	$	42	$	—	$	42	$	40	$	—	$	40	$	2	$	—	$	2
Investment income, net of related expenses	823		2		825		746		4		750		77		(2)		75
Investment related gains (losses), net	36		—		36		(86)		—		(86)		122		—		122
Other revenues	142		80		222		78		79		157		64		1		65
Total revenues	1,043		82		1,125		778		83		861		265		(1)		264
Benefits and expenses:
Claims and other policy benefits	129		—		129		152		—		152		(23)		—		(23)
Interest credited	445		—		445		431		—		431		14		—		14
Policy acquisition costs and other insurance expenses	113		4		117		68		4		72		45		—		45
Other operating expenses	27		10		37		22		8		30		5		2		7
Total benefits and expenses	714		14		728		673		12		685		41		2		43
Income before income taxes	$	329	$	68	$	397	$	105	$	71	$	176	$	224	$	(3)	$	221

Asset-Intensive Reinsurance

The increase in income before income taxes for U.S. and ~~COVID-19 related factors.~~

~~Interest credited expense decreased $1 million, or 5.0%, and $3 million, or 5.1%,~~Latin America Financial Solutions’ Asset-intensive segment for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. Interest credited in this segment relates to amounts credited on cash value products which also have a significant mortality component. Income before income taxes is affected by the spread between the investment income and the interest credited on the underlying products.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were 13.3% and 14.4% for the third quarter and 13.2% and 13.4% for the nine months ended September 30, 2020 and 2019, respectively. While these ratios are expected to remain in a predictable range, they may fluctuate from period to period due to varying allowance levels within coinsurance-type arrangements. In addition, the amortization pattern of previously capitalized amounts, which are subject to the form of the reinsurance agreement and the underlying insurance policies, may vary. Also, the mix of first year coinsurance business versus yearly renewable term business can cause the percentage to fluctuate from period to period.

Other operating expenses decreased $1 million, or 2.9%, and $8 million, or 7.6%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decrease in the third quarter and first nine months2021, was primarily due to ~~lower salaries~~contributions from new transactions, favorable policyholder experience, the change in fair value of the embedded derivatives and ~~fringe costs~~higher investment related gains (losses), net in coinsurance and funds withheld portfolios.

The invested asset base supporting this segment increased to ~~incentive-based compensation accruals. Other operating expenses,~~$24.6 billion as ~~a percentage~~ of ~~net premiums were 2.4% and 2.5% for~~September 30, 2021, from $23.6 billion as of September 30, 2020.

•The increase in the ~~third quarter and 2.3% and 2.5% first nine months of 2020 and 2019, respectively. The expense ratio tends to fluctuate only slightly from period to period~~asset base was primarily due to ~~the maturity and scale of this segment.~~growth from new transactions.

~~Financial Solutions~~ •– ~~Asset-Intensive Reinsurance~~

~~Asset-Intensive reinsurance within~~As of September 30, 2021 and 2020, $4.7 billion and $3.2 billion, respectively, of the U.S. and Latin America Financial Solutions segment primarily involves assuming investment risk within underlying annuities and corporate-owned life insurance policies. Most of these agreements are coinsurance, coinsurance withinvested assets were funds withheld ~~or modco. The Company recognizes profits or losses primarily from the spread between the investment income earned and the~~at interest, ~~credited on the underlying deposit liabilities, income~~of which greater than 90% was associated with ~~longevity risk, and fees associated with variable annuity account values and guaranteed investment contracts.~~two clients.

Table of Contents

Impact of certain ~~derivatives:~~derivatives

Income from the asset-intensive business tends to be volatile due to changes in the fair value of certain derivatives, including embedded derivatives associated with reinsurance treaties structured on a modco or funds withheld basis, as well as embedded derivatives associated with the Company’s reinsurance of equity-indexed annuities and variable annuities with guaranteed minimum benefit riders. Fluctuations occur period to period primarily due to changing investment conditions including, but not limited to, interest rate movements (including risk-free rates and credit spreads), implied volatility, the Company’s own credit risk and equity market performance, all of which are factors in the calculations of fair value. Therefore, management believes it is helpful to distinguish between the effects of changes in these derivatives, net of related hedging activity, and the primary factors that drive profitability of the underlying treaties, namely investment income, fee income (included in other revenues), and interest credited. These fluctuations are considered unrealized by management and do not affect current cash flows, crediting rates or spread performance on the underlying treaties.

The following table summarizes the asset-intensive results and quantifies the impact of these embedded derivatives for the periods presented. Revenues before certain derivatives, benefits and expenses before certain derivatives, and income before income taxes and certain derivatives, should not be viewed as substitutes for GAAP revenues, GAAP benefits and expenses, and GAAP income before income taxes.


(dollars in millions)	Three months ended September 30,						Nine months ended September 30,						(dollars in millions)	Three months ended September 30,				Nine months ended September 30,
	2020			2019			2020			2019				2021		2020		2021		2020
Revenues:													Revenues:
Total revenues	$	370		$	360		$	778		$	868		Total revenues	$	347	$	370	$	1,043	$	778
Less:													Less:
Embedded derivatives – modco/funds withheld treaties	124			18			(105		)	32			Embedded derivatives – modco/funds withheld treaties	26		124		85		(105)
Guaranteed minimum benefit riders and related free standing derivatives	(63		)	(1		)	50			—			Guaranteed minimum benefit riders and related free standing derivatives	(34)		(63)		(99)		50
Revenues before certain derivatives	309			343			833			836			Revenues before certain derivatives	355		309		1,057		833
Benefits and expenses:													Benefits and expenses:
Total benefits and expenses	320			260			673			631			Total benefits and expenses	241		320		714		673
Less:													Less:
Embedded derivatives – modco/funds withheld treaties	66			9			(50		)	18			Embedded derivatives – modco/funds withheld treaties	8		66		31		(50)
Guaranteed minimum benefit riders and related free standing derivatives	(4		)	2			37			1			Guaranteed minimum benefit riders and related free standing derivatives	(2)		(4)		(35)		37
Equity-indexed annuities	5			19			15			29			Equity-indexed annuities	(2)		5		(18)		15
Benefits and expenses before certain derivatives	253			230			671			583			Benefits and expenses before certain derivatives	237		253		736		671
Income before income taxes:													Income before income taxes:
Income before income taxes	50			100			105			237			Income before income taxes	106		50		329		105
Less:													Less:
Embedded derivatives – modco/funds withheld treaties	58			9			(55		)	14			Embedded derivatives – modco/funds withheld treaties	18		58		54		(55)
Guaranteed minimum benefit riders and related free standing derivatives	(59		)	(3		)	13			(1		)	Guaranteed minimum benefit riders and related free standing derivatives	(32)		(59)		(64)		13
Equity-indexed annuities	(5		)	(19		)	(15		)	(29		)	Equity-indexed annuities	2		(5)		18		(15)
Income before income taxes and certain derivatives	$	56		$	113		$	162		$	253		Income before income taxes and certain derivatives	$	118	$	56	$	321	$	162

Embedded Derivatives – Modco/Funds Withheld Treaties – Represents the change in the fair value of embedded derivatives on funds withheld at interest associated with treaties written on a modco or funds withheld basis. The fair value changes of embedded derivatives ~~on funds withheld at interest associated with treaties written on a modco or funds withheld basis~~ are reflected in revenues, while the related impact on deferred acquisition expenses is reflected in benefits and expenses. The Company’s utilization of a credit valuation adjustment did not have a material effect on the change in fair value of these embedded derivatives for the nine months ended September 30, ~~2020~~2021 and ~~2019.~~2020.

The change in fair value of the embedded derivatives -related to modco/funds withheld treaties, net of deferred acquisition costs increased (decreased) income before income taxes by ~~$58~~$18 million and $9$58 million for the third quarter and ~~$(55)~~$54 million and ~~$14~~$(55) million for the nine months ended September 30, ~~2020~~2021 and ~~2019,~~2020, respectively. The increase in income for the third quarter was primarily due to ~~tightening credit spreads.~~the flattening interest rate curve. The ~~decrease~~increase in income for the ~~first~~ nine months ~~of 2020~~ended September 30, 2021, was primarily due to ~~widening~~tightening credit ~~spreads, partially offset by lower interest rates, both~~spreads.

Table of ~~which were primarily attributable to the recent disruption in the global financial markets caused by the COVID-19 pandemic.~~Contents

Guaranteed Minimum Benefit Riders – Represents the impact related to guaranteed minimum benefits associated with the Company’s reinsurance of variable annuities. The fair value changes of the guaranteed minimum benefits along with the changes in fair value of the free standing derivatives (interest rate swaps, financial futures and equity options), purchased by the Company to substantially hedge the liability are reflected in revenues, while the related impact on deferred acquisition expenses is reflected in benefits and expenses. Changes in fair values of the embedded derivatives on guaranteed minimum benefits are net of an increase (decrease) in investment related gains (losses), net of ~~$(49)~~$7 million and $3$(49) million for the third quarter and ~~$79~~$(56) million and $1$79 million for the nine months ended September 30, ~~2020~~2021 and ~~2019,~~2020, respectively, associated with the Company’s utilization of a credit valuation adjustment.

The change in fair value of the guaranteed minimum benefits, after allowing for changes in the associated free standing derivatives, increased (decreased) income before income taxes by ~~$(59)~~$(32) million and ~~$(3)~~$(59) million for the third quarter and ~~$13~~$(64) million and ~~$(1)~~$13 million for the nine months ended September 30, ~~2020~~2021 and ~~2019,~~2020, respectively. The decrease in income for the three months ended September 30, ~~2020~~2021, was primarily due to the annual update of best estimate actuarial assumptions for future mortality improvement. The decrease in income for the nine months ended September 30, 2021, was primarily due to a decrease in the credit valuation adjustment which ~~was primarily attributable to~~has the ~~recent disruption in~~impact of increasing the ~~global financial markets caused by~~fair value of the ~~COVID-19 pandemic,~~guaranteed minimum benefit liability, net of related impact on deferred acquisition expenses and the annual update of best estimate actuarial assumptions ~~to account~~ for lower policyholder lapse experience. The increase in income for the nine months ended September 30, 2020, was due to the increase in credit valuation adjustment, which was primarily attributable to the recent disruption in the global financial markets caused by the COVID-19 pandemic, partially offset by the annual update of best estimate actuarial assumptions to account for lower policyholder lapse experience.future mortality improvement.

Equity-Indexed Annuities – Represents changes in the liability for equity-indexed annuities in excess of changes in account value, after adjustments for related deferred acquisition expenses. The change in fair value of embedded derivative liabilities associated with equity-indexed annuities ~~decreased~~increased (decreased) income before income taxes by $5$2 million and ~~$19~~$(5) million for the third quarter and ~~$15~~$18 million and ~~$29~~$(15) million for the nine months ended September 30, ~~2020~~2021 and ~~2019,~~2020, respectively. The ~~decreases~~increase in income for the ~~third quarter and~~ first nine months of ~~2020 were~~2021 was primarily due to ~~declining~~an increase in risk free interest ~~rates.~~rates which has the impact of lowering the fair value of the liability.

The changes in derivatives discussed above are considered unrealized by management and do not affect current cash flows, crediting rates or spread performance on the underlying treaties. Fluctuations occur period to period primarily due to changing investment conditions including, but not limited to, interest rate movements (including benchmark rates and credit spreads), credit valuation adjustments, implied volatility and equity market performance, all of which are factors in the calculations of fair value. Therefore, management believes it is helpful to distinguish between the effects of changes in these derivatives and the primary factors that drive profitability of the underlying treaties, namely investment income, fee income (included in other revenues) and interest credited.

Discussion and analysis before certain derivatives:

•Income before income taxes and certain derivatives ~~decreased~~increased by ~~$57~~$62 million and ~~$91~~$159 million for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same periods in ~~2019.~~2020. The ~~decrease for the three months and nine months ended September 30, 2020, was~~increases were primarily due to ~~lower~~contributions from new transactions, favorable policyholder experience and higher investment related gains (losses), net in coinsurance and funds withheld portfolios. ~~Funds withheld capital gains (losses) are reported in investment income.~~

•Revenue before certain derivatives ~~decreased~~increased by ~~$34~~$46 million and by $3$224 million for the three and nine months ended September 30, ~~2020,~~2021, respectively, as compared to the same periods in ~~2019.~~2020. The ~~decrease in the third quarter was~~increases were primarily due to ~~lower investment related gains (losses), net, partially offset by~~ the ~~change~~revenue associated with recently executed transactions, increases in fair value of equity options associated with the reinsurance of ~~EIAs.~~EIAs and higher investment related gains (losses), net in coinsurance portfolios. The effect on investment income related to equity options is substantially offset by a corresponding change in interest credited. The decrease in the first nine months of 2020 was primarily due to lower investment related gains (losses), net, partially offset by full year contributions from asset-intensive transactions executed in 2019.

•Benefits and expenses before certain derivatives increased (decreased) by ~~$23~~$(16) million and ~~$88~~$65 million for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same period in ~~2019.~~2020. The ~~increases~~decrease in the third quarter ~~and~~was primarily due to the expected run-off from closed block transactions. The increase in the first nine months ~~were~~was primarily due to ~~full year contributions from asset-intensive transactions executed in 2019 and by~~ higher interest credited associated with the reinsurance of ~~EIAs.~~EIAs due to improved equity market performance and benefits associated with recently executed transactions, partially offset by the expected run-off from closed block transactions. The effect on interest credited related to equity options is substantially offset by a corresponding ~~change~~increase in investment income.

The invested asset base supporting this segment decreased to $23.6 billion as of September 30, 2020 from $24.7 billion as of September 30, 2019. As of September 30, 2020, $3.2 billion of the invested assets were funds withheld at interest, of which greater than 90% is associated with one client.

~~Financial Solutions~~ – ~~Capital Solutions~~

Capital Solutions ~~within~~

Income before income taxes for the U.S. and Latin America ~~Financial Solutions segment income before income taxes consists primarily of net fees earned on financial reinsurance transactions. Additionally, a portion of the~~Capital Solutions’ business is brokered business in which the Company does not participate in the assumption of risk. The fees earned from financial reinsurance contracts and brokered business are reflected in other revenues, and the fees paid to retrocessionaires are reflected in policy acquisition costs and other insurance expenses.

~~Income before income taxes increased $5~~decreased $2 million, or ~~26.3%~~8.3%, and ~~$14~~$3 million, or ~~24.6%~~4.2%, for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same periods in ~~2019.~~2020. The ~~increases~~decreases were primarily due to the termination of certain transactions, partially offset by growth from new transactions and ~~organic growth on existing transactions.~~

At September 30, 2020 and 2019, the amount of reinsurance assumed from client companies, as measured by pre-tax statutory surplus, risk based capital and other financial structures was $20.4 billion and $15.9 billion, respectively. The increase was primarily due to new transactions offsetting the termination of certain agreements, as well as organic growth on existing transactions. Fees earned from this business can vary significantly depending on the size of the transactions and the timing of their completion and therefore can fluctuate from period to period.

•At September 30, 2021 and 2020, the amount of reinsurance assumed from client companies, as measured by pre-tax statutory surplus, risk based capital and other financial structures was $22.0 billion and $20.4 billion, respectively.

Table of Contents

Canada Operations

The Company conducts reinsurance business in Canada primarily through RGA ~~Canada.~~Canada, which assists clients with capital management activity and mortality and morbidity risk management. The Canada operations are primarily engaged in Traditional reinsurance, which consists mainly of traditional individual life reinsurance, and to a lesser extent creditor, group life and health, critical illness and disability reinsurance. Creditor insurance covers the outstanding balance on personal, mortgage or commercial loans in the event of death, disability or critical illness and is generally shorter in duration than traditional individual life insurance. The Canada Financial Solutions segment consists of longevity and ~~financial reinsurance.~~capital solutions.


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in millions)	2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Revenues:
Net premiums	$	311	$	275	$	36	$	938	$	830	$	108
Investment income, net of related expenses	65		52		13		188		152		36
Investment related gains (losses), net	1		2		(1)		3		(4)		7
Other revenues	2		3		(1)		11		7		4
Total revenues	379		332		47		1,140		985		155
Benefits and expenses:
Claims and other policy benefits	278		242		36		860		715		145
Interest credited	—		—		—		—		—		—
Policy acquisition costs and other insurance expenses	47		44		3		139		132		7
Other operating expenses	10		10		—		31		28		3
Total benefits and expenses	335		296		39		1,030		875		155
Income before income taxes	$	44	$	36	$	8	$	110	$	110	$	—

(dollars in millions) Three months ended September 30,
2020 2019
Revenues: Traditional Financial Solutions Total Canada Traditional Financial Solutions Total Canada
Net premiums $ 254
$ 21
$ 275
$ 271
$ 22
$ 293
Investment income, net of related expenses 52
—
52
53
1
54
Investment related gains (losses), net 2
—
2
1
—
1
Other revenues 1
2
3
—
1
1
Total revenues 309
23
332
325
24
349
Benefits and expenses:
Claims and other policy benefits 225
17
242
216
20
236
Interest credited —
—
—
—
—
—
Policy acquisition costs and other insurance expenses 44
—
44
57
—
57
Other operating expenses 10
—
10
9
1
10
Total benefits and expenses 279
17
296
282
21
303
Income before income taxes $ 30
$ 6
$ 36
$ 43
$ 3
$ 46

(dollars in millions) Nine months ended September 30,
2020 2019
Revenues: Traditional Financial Solutions Total Canada Traditional Financial Solutions Total Canada
Net premiums $ 768
$ 62
$ 830
$ 790
$ 67
$ 857
Investment income, net of related expenses 151
1
152
153
2
155
Investment related gains (losses), net (4 ) —
(4 ) 11
—
11
Other revenues 1
6
7
1
3
4
Total revenues 916
69
985
955
72
1,027
Benefits and expenses:
Claims and other policy benefits 661
54
715
622
61
683
Interest credited —
—
—
—
—
—
Policy acquisition costs and other insurance expenses 131
1
132
168
1
169
Other operating expenses 27
1
28
25
2
27
Total benefits and expenses 819
56
875
815
64
879
Income before income taxes $ 97
$ 13
$ 110
$ 140
$ 8
$ 148

•The increase in income before income taxes for the three months ended September 30, 2021, as compared to the same period in 2020, is primarily due to an increase in investment income. Income before income taxes ~~decreased~~for the nine months ended September 30, 2021, as compared to the same period in 2020, is relatively stable primarily due to an increase in investment income, offset by ~~$10~~increased claims and other policy benefits associated with the COVID-19 pandemic.

•Foreign currency fluctuations can result in variances in the financial statement line items. Foreign currency fluctuations resulted in a $3 million ~~or 21.7%,~~ and ~~$38~~$6 million ~~or 25.7%,~~increase in income before income taxes for the three and nine months ended September 30, ~~2020,~~2021, respectively. Unless otherwise stated, all amounts discussed below are net of foreign currency fluctuations.

Traditional Reinsurance


	Three Months Ended September 30,								Nine Months Ended September 30,
(dollars in millions)	2021			2020			2021 vs 2020		2021			2020			2021 vs 2020
Revenues:
Net premiums	$	289		$	254		$	35	$	870		$	768		$	102
Investment income, net of related expenses	65			52			13		188			151			37
Investment related gains (losses), net	1			2			(1)		3			(4)			7
Other revenues	(1)			1			(2)		2			1			1
Total revenues	354			309			45		1,063			916			147
Benefits and expenses:
Claims and other policy benefits	255			225			30		798			661			137
Interest credited	—			—			—		—			—			—
Policy acquisition costs and other insurance expenses	46			44			2		137			131			6
Other operating expenses	9			10			(1)		28			27			1
Total benefits and expenses	310			279			31		963			819			144
Income (loss) before income taxes	$	44		$	30		$	14	$	100		$	97		$	3
Key metrics:
Life insurance in force									$463.1 billion			$419.5 billion
Claims and other policy benefits as a percentage of net premiums (“loss ratios”)	88.2		%	88.6		%			91.7		%	86.1		%
Policy acquisition costs and other insurance expenses as a percentage of net premiums	15.9		%	17.3		%			15.7		%	17.1		%
Other operating expenses as a percentage of net premiums	3.1		%	3.9		%			3.2		%	3.5		%

Table of Contents

The increase in income before income taxes for the three months ended September 30, 2021, is primarily due to an increase in investment income. The income before income taxes for the nine months ended September 30, 2021, as compared to the same ~~periods~~period in ~~2019.~~ 2020, is relatively stable primarily due to an increase in investment income, partially offset by increased claims and other policy benefits associated with the COVID-19 pandemic.

Revenues

•The segment added new life business production, measured by face amount of insurance in force, of $11.5 billion and $8.6 billion for the third quarter of 2021 and 2020, respectively, and $34.2 billion, and $29.9 billion during the first nine months of 2021 and 2020, respectively.

•The increase in net investment income for the three and nine months ended September 30, 2021, was primarily due to increased variable investment income and an increase in the invested asset base due to growth in the underlying business volume partially offset by a decline in interest rates.

•The increase in investment related gains (losses) for the nine months ended September 30, 2021, is due to an increase in the fair value of credit default derivatives during the first nine months of 2021, compared to a decrease in the fair value of credit default derivatives for the same period in 2020.

Benefits and expenses

•The loss ratio for the three months ended September 30, 2021, is consistent with the three months ended September 30, 2020. The increase in the loss ratio for the nine months ended September 30, 2021, as compared to the same period in 2020, was primarily due to unfavorable claims experience in the individual mortality line of business, attributed primarily to the COVID-19 pandemic. While the cause of death is not yet available for all claims, the Company estimates that approximately $50 million of excess claims for the nine months ended September 30, 2021, were attributable to COVID-19 or COVID-19 related factors.

Financial Solutions Reinsurance


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in millions)	2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Revenues:
Net premiums	$	22	$	21	$	1	$	68	$	62	$	6
Investment income, net of related expenses	—		—		—		—		1		(1)
Investment related gains (losses), net	—		—		—		—		—		—
Other revenues	3		2		1		9		6		3
Total revenues	25		23		2		77		69		8
Benefits and expenses:
Claims and other policy benefits	23		17		6		62		54		8
Interest credited	—		—		—		—		—		—
Policy acquisition costs and other insurance expenses	1		—		1		2		1		1
Other operating expenses	1		—		1		3		1		2
Total benefits and expenses	25		17		8		67		56		11
Income (loss) before income taxes	$	—	$	6	$	(6)	$	10	$	13	$	(3)

The decrease in income before income taxes for the ~~third quarter~~three months ended September 30, 2021, as compared to the same periods in 2020, is primarily ~~due to~~the result of slightly unfavorable ~~individual life~~ mortality experience on longevity business in 2021 as compared to favorable experience ~~for the same period~~ in ~~2019.~~2020. The decrease in income before income taxes for the first nine months is primarily due to less favorable individual life mortality experience compared to the same period in 2019. Foreign currency exchange fluctuations in the Canadian dollar resulted in a decrease in income before income taxes of $1 million for the nine months ended September ~~30, 2020,~~20, 2021, as compared to the same period in ~~2019.~~

~~Traditional Reinsurance~~

~~Income before income taxes for the Canada Traditional segment decreased by $13 million, or 30.2%, and $43 million, or 30.7%, for the three and nine months ended September 30,~~ 2020, ~~as compared to the same periods in 2019. The decrease in income before income taxes for the third quarter~~ is also primarily due to unfavorable individual life mortality experience compared to favorable experience for the same period in 2019. The decrease in income before income taxes for the first nine months is primarily due to less favorable individual life mortality experience compared to the same period in 2019. See “The COVID-19 Impact and Update” above for more information regarding the impact of COVID-19. Foreign currency exchange fluctuations in the Canadian dollar resulted in a decrease in income before income taxes of $1 million for the nine months ended September 30, 2020, as compared to the same period in 2019.

Net premiums decreased by $17 million, or 6.3%, and $22 million, or 2.8%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decreases in net premiums in 2020 were primarily due to foreign currency losses, an anticipated reduction in the base of the offshore creditors business and a non-recurring payment received in the third quarter of 2019 relating to a block of existing business, partially offset by a new inforce block transaction effective January 1, 2020. Foreign currency exchange fluctuations in the Canadian dollar resulted in a decrease in net premiums of $2 million and $14 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019.

Net investment income decreased $1 million, or 1.9%, and $2 million, or 1.3%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. Foreign currency exchange fluctuation in the Canadian dollar resulted in a decrease in net investment income of $3 million for the nine months ended September 30, 2020, as compared to the same period in 2019.

Other revenues increased by $1 million and were unchanged for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The variance was primarily due to gains and losses related to foreign currency transactions.

Loss ratios for this segment were 88.6% and 79.7% for the third quarter and 86.1% and 78.7% for the nine months ended September 30, 2020 and 2019, respectively. The increase in the loss ratio for the third quarter is primarily due to unfavorable individual life mortality experience as compared to favorable experience for the same period in 2019. The increase in the loss ratio for the first nine months is primarily due to less favorable individual life mortality experience compared to the same period in 2019. Approximately $3 million and $11 million of claims for the three and nine months ended September 30, 2020, were identified as COVID-19 related and contributed to the higher loss ratios in 2020.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were 17.3% and 20.9% for the third quarter and 17.1% and 21.2% for the nine months ended September 30, 2020 and 2019, respectively. Overall, while these ratios are expected to remain in a predictable range, they may fluctuate from period to period due to varying allowance levels and product mix. The decreases in the policy acquisition and other insurance expenses as percentage of net premiums was the result of ~~a reduction in creditor business which has higher allowances than other businesses. In addition, the amortization patterns~~less favorable mortality on longevity business.

Table of ~~previously capitalized amounts, which are subject to the form of the reinsurance agreement and the underlying insurance policies, may vary.~~Contents

Other operating expenses increased $1 million, or 11.1%, and $2 million, or 8.0%, for the three and nine months ended September 30, 2020, respectively, as compared to the same periods in 2019. Other operating expenses as a percentage of net premiums were 3.9% and 3.2% for the third quarter and 3.5% and 3.2% for the nine month periods ended September 30, 2020 and 2019, respectively.

~~Financial Solutions Reinsurance~~

Income before income taxes increased $3 million, or 100%, and $5 million, or 62.5%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The increases in income were primarily due to a new transaction completed at the end of 2019.

Net premiums decreased $1 million, or 4.5%, and $5 million, or 7.5%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decreases were primarily due to decreases of in force longevity premiums. Foreign currency exchange fluctuations in the Canadian dollar resulted in a decrease in net premiums of $1 million for the nine months ended September 30, 2020, as compared to the same period in 2019.

Claims and other policy benefits decreased $3 million, or 15.0%, and $7 million, or 11.5%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decreases were primarily a result of more favorable claims experience in the longevity block of business compared to the same period last year.

Europe, Middle East and Africa Operations

The ~~EMEA~~Europe, Middle East and Africa (“EMEA”) operations include business primarily generated by ~~its~~ offices ~~principally~~ in France, Germany, Ireland, Italy, the Middle East, the Netherlands, Poland, South Africa, Spain and the United Kingdom (“UK”). EMEA consists of two major segments: Traditional and Financial Solutions. The Traditional segment primarily provides reinsurance through yearly renewable term and coinsurance agreements on a variety of life, health and critical illness products. Reinsurance agreements may be facultative or automatic agreements covering primarily individual risks and, in some markets, group risks. The Financial Solutions segment consists of reinsurance and other transactions associated with longevity closed blocks, payout annuities, capital management solutions and financial reinsurance.


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in millions)	2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Revenues:
Net premiums	$	528	$	429	$	99	$	1,562	$	1,281	$	281
Investment income, net of related expenses	73		64		9		215		190		25
Investment related gains (losses), net	23		4		19		41		14		27
Other revenues	4		3		1		11		7		4
Total revenues	628		500		128		1,829		1,492		337
Benefits and expenses:
Claims and other policy benefits	559		336		223		1,559		1,037		522
Interest credited	(2)		(1)		(1)		(1)		(2)		1
Policy acquisition costs and other insurance expenses	37		29		8		96		93		3
Other operating expenses	40		37		3		118		104		14
Total benefits and expenses	634		401		233		1,772		1,232		540
Income before income taxes	$	(6)	$	99	$	(105)	$	57	$	260	$	(203)

(dollars in millions) Three months ended September 30,
2020 2019
Revenues: Traditional Financial Solutions Total EMEA Traditional Financial Solutions Total EMEA
Net premiums $ 371
$ 58
$ 429
$ 359
$ 55
$ 414
Investment income, net of related expenses 18
46
64
17
55
72
Investment related gains (losses), net —
4
4
—
2
2
Other revenues 1
2
3
2
5
7
Total revenues 390
110
500
378
117
495
Benefits and expenses:
Claims and other policy benefits 331
5
336
297
34
331
Interest credited —
(1 ) (1 ) —
12
12
Policy acquisition costs and other insurance expenses 28
1
29
27
—
27
Other operating expenses 24
13
37
29
10
39
Total benefits and expenses 383
18
401
353
56
409
Income before income taxes $ 7
$ 92
$ 99
$ 25
$ 61
$ 86

(dollars in millions) Nine months ended September 30,
2020 2019
Revenues: Traditional Financial Solutions Total EMEA Traditional Financial Solutions Total EMEA
Net premiums $ 1,113
$ 168
$ 1,281
$ 1,074
$ 164
$ 1,238
Investment income, net of related expenses 55
135
190
54
150
204
Investment related gains (losses), net —
14
14
—
8
8
Other revenues —
7
7
4
18
22
Total revenues 1,168
324
1,492
1,132
340
1,472
Benefits and expenses:
Claims and other policy benefits 966
71
1,037
905
130
1,035
Interest credited —
(2 ) (2 ) —
27
27
Policy acquisition costs and other insurance expenses 90
3
93
84
2
86
Other operating expenses 72
32
104
86
30
116
Total benefits and expenses 1,128
104
1,232
1,075
189
1,264
Income before income taxes $ 40
$ 220
$ 260
$ 57
$ 151
$ 208

~~Income~~•The decreases in income before income taxes ~~increased by $13 million, or 15.1%, and $52 million, or 25.0%,~~ for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same periods in ~~2019. The increases in income before income taxes~~2020, were primarily due to ~~favorable performance on closed block longevity business offset by poor~~unfavorable mortality experience mainly from the impact of COVID-19. The unfavorable mortality experience was partially offset by increases in net premiums, investment income and investment related gains.

•Foreign currency fluctuations can result in variances in the financial statement line items. Foreign currency exchange fluctuations resulted in ~~an increase~~a decrease in income before income taxes of $6$9 million and $2$3 million for the three and nine months ended September 30, ~~2020,~~2021, respectively, as compared to the same periods in ~~2019.~~2020. Unless otherwise stated, all amounts discussed below are net of foreign currency fluctuations.

Traditional Reinsurance


	Three Months Ended September 30,								Nine Months Ended September 30,
(dollars in millions)	2021			2020			2021 vs 2020		2021			2020			2021 vs 2020
Revenues:
Net premiums	$	432		$	371		$	61	$	1,303		$	1,113		$	190
Investment income, net of related expenses	22			18			4		66			55			11
Investment related gains (losses), net	—			—			—		—			—			—
Other revenues	—			1			(1)		1			—			1
Total revenues	454			390			64		1,370			1,168			202
Benefits and expenses:
Claims and other policy benefits	482			331			151		1,365			966			399
Interest credited	—			—			—		—			—			—
Policy acquisition costs and other insurance expenses	35			28			7		91			90			1
Other operating expenses	28			24			4		85			72			13
Total benefits and expenses	545			383			162		1,541			1,128			413
Income (loss) before income taxes	$	(91)		$	7		$	(98)	$	(171)		$	40		$	(211)
Key metrics:
Life insurance in force									$852.8 billion			$808.0 billion
Claims and other policy benefits as a percentage of net premiums (“loss ratios”)	111.6		%	89.2		%			104.8		%	86.8		%
Policy acquisition costs and other insurance expenses as a percentage of net premiums	8.1		%	7.5		%			7.0		%	8.1		%
Other operating expenses as a percentage of net premiums	6.5		%	6.5		%			6.5		%	6.5		%

Table of Contents

Income before income taxes decreased ~~$18 million and $17 million~~ for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same periods in ~~2019. Poor~~2020. The decreases were the result of poor mortality experience, primarily due to the impact of ~~COVID-19, as well as poor morbidity experience was~~COVID-19. The decreases in both periods were partially offset by ~~a decrease~~increases in general expenses. The decrease in income for the first nine months was primarily due to a worsening of mortality experience, mainly due to COVID-19 claims as well as poor morbidity experience, partially offset by lower general expenses. See net premiums.

Revenues

•~~“The COVID-19 Impact and Update” above for more information regarding the impact of COVID-19.~~ Foreign currency exchange fluctuations resulted in an increase in income before income taxes of $2 million and $1 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019.

~~Net premiums increased $12 million, or 3.3%, and $39 million, or 3.6%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019.~~ The increase in net premiums for the three and nine months ended September 30, 2021, as compared to the same periods in 2020, was due to an in increase in business volume on new and existing treaties.

•The segment added new life business production, measured by face amount of insurance in force, of $32.0 billion and $28.5 billion during the third quarter of 2021 and 2020, respectively, and $147.4 billion and $126.5 billion during the nine months ended September 30, 2021 and 2020, respectively.

Benefits and expenses

•The increase in the loss ratio for the third quarter and first nine months of 2021 was due to unfavorable mortality experience primarily attributable to COVID-19. While the cause of death is not available for all claims, the Company estimates for the nine months ended September 30, 2021, that approximately $205 million of excess claims, of which approximately $113 million were incurred in South Africa and $84 million were incurred in the UK. While the cause of death is not available for all claims, the Company believes the excess claims were primarily attributable to COVID-19 or COVID-19 related factors.

•The increase in the ratio of policy acquisition costs and other insurance expense to net premium in the third quarter was due to an increase in ~~business volume from new treaties. Additionally, foreign currency exchange fluctuations increased net~~ premiums ~~by $6 million~~ and ~~decreased net~~transactions with higher acquisition costs, and the decrease in the first nine months of 2021 was due to an overall increase in premiums ~~by $27 million~~and transactions with lower or no acquisition costs.

•The increase in other operating expenses for the three and nine months ended September 30, ~~2020, as~~2021, was primarily due to an increase in incentive compensation expense.

Financial Solutions


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in millions)	2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Revenues:
Net premiums	$	96	$	58	$	38	$	259	$	168	$	91
Investment income, net of related expenses	51		46		5		149		135		14
Investment related gains (losses), net	23		4		19		41		14		27
Other revenues	4		2		2		10		7		3
Total revenues	174		110		64		459		324		135
Benefits and expenses:
Claims and other policy benefits	77		5		72		194		71		123
Interest credited	(2)		(1)		(1)		(1)		(2)		1
Policy acquisition costs and other insurance expenses	2		1		1		5		3		2
Other operating expenses	12		13		(1)		33		32		1
Total benefits and expenses	89		18		71		231		104		127
Income (loss) before income taxes	$	85	$	92	$	(7)	$	228	$	220	$	8

The decrease in income before income taxes for the third quarter of 2021, compared to the same ~~periods~~period in ~~2019.~~

~~A portion~~2020, is primarily due to increases in claims and other policy benefits, partially offset by increases in investment income, net of ~~the net premiums for the segment,~~related expenses and investment related gains (losses), net. The increase in each period presented, relates to reinsurance of critical illness coverage (morbidity risk), primarily in the UK. This coverage provides a benefit in the event of the diagnosis of a pre-defined critical illness. Net premiums earned from this coverage totaled $43 million and $49 million for the third quarter and $125 million and $136 millionincome before income taxes for the first nine months of ~~2020~~2021 was primarily due to new business activity and ~~2019, respectively.~~investment related gains on the investments supporting the segment’s payout annuity business, partially offset by a normalization of performance.

~~Net investment income increased $1 million, or 5.9%, and $1 million, or 1.9%,~~Revenues

•The increase in net premiums for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same periods in ~~2019. The increase is~~2020, was primarily due to anincreased volumes of closed longevity block business.

•The increase ~~in the invested asset base from business growth, partially offset by a decrease in investment yields. Foreign currency exchange fluctuations resulted in a decrease~~ in net investment income ~~of $2 million for the nine months ended September 30, 2020, as compared to the same period in 2019.~~

Loss ratios for this segment were 89.2% and 82.7% for the third quarter and 86.8% and 84.3% for the first nine months ended September 30, 2020 and 2019, respectively. The increases in loss ratios were due to normal claims variability and the impact of approximately $13 million of COVID-19 related claims reported during the third quarter of 2020. Approximately $42 million of COVID-19 related claims have been reported for the nine months ended September 30, 2020.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were 7.5% and 7.4% for the third quarter and 8.1% and 7.8% for the first nine months ended September 30, 2020 and 2019, respectively. Changes in the percentages are due primarily to variations in the mixture of business.

~~Other operating expenses decreased $5 million, or 17.2%, and $14 million, or 16.3%,~~ for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same periods in ~~2019.~~ 2020, was primarily due to higher investment income on fixed-income securities and life-time mortgages.

•The ~~current periods have benefited from reduced incentive-based compensation and travel expenses primarily attributable to COVID-19. Foreign currency fluctuations resulted~~increase in ~~a decrease in operating expenses of $2 million~~investment related gains (losses), net for the three and nine month periods was primarily due to fluctuations in the fair market value of CPI swap derivatives due to changes in future inflation expectations and higher investment related gains on fixed-income securities, respectively.

Table of Contents

Benefits and expenses

•The increase in claims and other policy benefits for the three months ended September 30, ~~2020,~~2021, as compared to the same period in ~~2019. Other operating expenses as a percentage~~2020, was the result of ~~net premiums totaled 6.5% and 8.1% for the third quarter and 6.5% and 8.0% for the first nine months ended September 30, 2020 and 2019, respectively.~~

~~Financial Solutions~~ ~~Reinsurance~~

~~Income before income taxes~~ increased by $31 million, or 50.8%, and $69 million, or 45.7%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The increases were primarily due to favorable termination experience on closed longevity blocks. Foreign currency exchange fluctuations resulted in an increase in income before income taxes of $4 million and $1 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019.

Net premiums increased by $3 million, or 5.5%, and $4 million, or 2.4%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The increases in net premiums were due to higher new business volumes of closed longevity ~~business. Foreign currency exchange fluctuations increased net premiums by $3 million for the three months ended September 30, 2020, as compared to the same period in 2019.~~

Net investment income decreased by $9 million, or 16.4%, and by $15 million, or 10.0%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decreases in investment income were primarily due to a decrease in investment income associated with unit-linked policies which fluctuate with market performance partly offset by an increase in the invested asset base from business growth. The effect on investment income related to unit-linked products is substantially offset by a corresponding change in interest credited. Foreign currency exchange fluctuations resulted in an increase in net investment income of $2 million for the three months ended September 30, 2020, as compared to the same period in 2019.

Investment related gains (losses) net, increased by $2 million and $6 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The increases were primarily due to increases in the fair market value of derivative hedging instruments.

Other revenues decreased by $3 million, or 60.0%, and $11 million, or 61.1%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decreases in other revenues primarily relates to fees from a treaty that terminated in the fourth quarter of 2019 and a one-time fee received related to a new payout annuity transaction completed in the second quarter of 2019. Foreign currency exchange fluctuations resulted in a decrease in other revenues of $1 million for the nine months ended September 30, 2020, as compared to the same period in 2019.

Claims and other policy benefits decreased $29 million, or 85.3%, and $59 million, or 45.4%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decrease in the third quarter and the first nine months was primarily due to favorable termination experience on closed block ~~longevity~~ business. ~~Foreign currency exchange fluctuations resulted in a decrease in claims and other policy benefits of $2 million for the nine months ended September 30, 2020, as compared to the same period in 2019.~~

Interest credited expense decreased by $13 million and $29 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. Interest credited in this segment relates to amounts credited to the contractholders of unit-linked products. The effect on interest credited related to unit-linked products is substantially offset by a corresponding change in investment income.

Other operating expenses increased $3 million, or 30.0%, and $2 million, or 6.7%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The increase is due to growth in operations and is in line with expected expense levels needed to support the business.

Asia Pacific Operations

The Asia Pacific operations include business generated by its offices principally in Australia, China, Hong Kong, India, Japan, Malaysia, New Zealand, Singapore, South Korea and Taiwan. The Traditional segment’s principal types of reinsurance include individual and group life and health, critical illness, disability and superannuation. Reinsurance agreements may be facultative or automatic agreements covering primarily individual risks, and in some markets, group risks. Superannuation is the Australian government mandated compulsory retirement savings program. Superannuation funds accumulate retirement funds for employees, and, in addition, typically offer life and disability insurance coverage. The Financial Solutions segment includes financial reinsurance, ~~and~~ asset-intensive ~~transactions including~~and certain disability and life ~~and health blocks with significant investment risk. Reinsurance agreements may be facultative or automatic agreements covering primarily individual risks and~~blocks.


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in millions)	2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Revenues:
Net premiums	$	691	$	688	$	3	$	2,017	$	2,036	$	(19)
Investment income, net of related expenses	70		44		26		196		136		60
Investment related gains (losses), net	(15)		—		(15)		11		(18)		29
Other revenues	12		14		(2)		42		38		4
Total revenues	758		746		12		2,266		2,192		74
Benefits and expenses:
Claims and other policy benefits	734		558		176		1,918		1,721		197
Interest credited	12		13		(1)		42		37		5
Policy acquisition costs and other insurance expenses	50		38		12		156		140		16
Other operating expenses	52		49		3		152		134		18
Total benefits and expenses	848		658		190		2,268		2,032		236
Income before income taxes	$	(90)	$	88	$	(178)	$	(2)	$	160	$	(162)

•The decrease in ~~some markets, group risks.~~

(dollars in millions) Three months ended September 30,
2020 2019
Revenues: Traditional Financial Solutions Total Asia Pacific Traditional Financial Solutions Total Asia Pacific
Net premiums $ 653
$ 35
$ 688
$ 656
$ 30
$ 686
Investment income, net of related expenses 22
22
44
27
10
37
Investment related gains (losses), net —
—
—
—
(1 ) (1 )
Other revenues 5
9
14
2
7
9
Total revenues 680
66
746
685
46
731
Benefits and expenses:
Claims and other policy benefits 525
33
558
585
28
613
Interest credited —
13
13
—
7
7
Policy acquisition costs and other insurance expenses 33
5
38
40
5
45
Other operating expenses 44
5
49
38
4
42
Total benefits and expenses 602
56
658
663
44
707
Income (loss) before income taxes $ 78
$ 10
$ 88
$ 22
$ 2
$ 24

(dollars in millions) Nine months ended September 30,
2020 2019
Revenues: Traditional Financial Solutions Total Asia Pacific Traditional Financial Solutions Total Asia Pacific
Net premiums $ 1,896
$ 140
$ 2,036
$ 1,909
$ 108
$ 2,017
Investment income, net of related expenses 76
60
136
77
31
108
Investment related gains (losses), net —
(18 ) (18 ) —
2
2
Other revenues 11
27
38
6
19
25
Total revenues 1,983
209
2,192
1,992
160
2,152
Benefits and expenses:
Claims and other policy benefits 1,594
127
1,721
1,699
97
1,796
Interest credited —
37
37
—
20
20
Policy acquisition costs and other insurance expenses 116
24
140
79
20
99
Other operating expenses 124
10
134
121
13
134
Total benefits and expenses 1,834
198
2,032
1,899
150
2,049
Income before income taxes $ 149
$ 11
$ 160
$ 93
$ 10
$ 103

~~Income~~income before income taxes ~~increased by $64 million, or 266.7%, and $57 million, or 55.3%,~~ for the three and nine months ended September 30, ~~2020, as compared to the same periods in 2019. The increase in income before income taxes for the three months ended September 30, 2020,~~2021, was primarily due to ~~favorable~~unfavorable claims experience in Asia ~~and a modest profit in Australia~~ compared to ~~losses in~~ the prior period, ~~as well as~~partially offset by continued growth of Financial Solutions Reinsurance in ~~Asia. The increase~~Asia and increases in investment income, ~~before income taxes for the first nine months is primarily attributable to~~ net ~~favorable claims experience across the segment.~~ and investment related gains (losses).

•Foreign currency ~~exchange~~ fluctuations ~~resulted~~can result in ~~an increase~~variances in ~~income before income taxes of $1 million and $3 million~~the financial statement line items. Foreign currency fluctuations were immaterial for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same periods in ~~2019.~~2020. Unless otherwise stated, all amounts discussed below are net of foreign currency fluctuations.

Table of Contents

Traditional Reinsurance

~~Income~~


	Three Months Ended September 30,								Nine Months Ended September 30,
(dollars in millions)	2021			2020			2021 vs 2020		2021			2020			2021 vs 2020
Revenues:
Net premiums	$	626		$	653		$	(27)	$	1,851		$	1,896		$	(45)
Investment income, net of related expenses	33			22			11		100			76			24
Investment related gains (losses), net	—			—			—		(1)			—			(1)
Other revenues	4			5			(1)		13			11			2
Total revenues	663			680			(17)		1,963			1,983			(20)
Benefits and expenses:
Claims and other policy benefits	682			525			157		1,778			1,594			184
Interest credited	—			—			—		—			—			—
Policy acquisition costs and other insurance expenses	31			33			(2)		115			116			(1)
Other operating expenses	46			44			2		137			124			13
Total benefits and expenses	759			602			157		2,030			1,834			196
Income (loss) before income taxes	$	(96)		$	78		$	(174)	$	(67)		$	149		$	(216)
Key metrics:
Life insurance in force									$526.0 billion			$534.4 billion
Claims and other policy benefits as a percentage of net premiums (“loss ratios”)	108.9		%	80.4		%			96.1		%	84.1		%
Policy acquisition costs and other insurance expenses as a percentage of net premiums	5.0		%	5.1		%			6.2		%	6.1		%
Other operating expenses as a percentage of net premiums	7.3		%	6.7		%			7.4		%	6.5		%

The decrease in income before income taxes ~~increased by $56 million, or 254.5%, and $56 million, or 60.2%,~~is primarily the result of net unfavorable claims experience in Asia, primarily in India. The decrease for the first nine months is also the result of year-to-date decreases in net premiums in Australia.

Revenues

•The decrease in net premiums for the three and nine months ended September 30, ~~2020~~2021, as compared to the same periods in ~~2019. The increase in income before income taxes for the three months ended September 30,~~ 2020, was the result of net favorable claims experience in Asia as compared to the same period in 2019, and a modest profit in Australia compared to losses in the same period in 2019. Income before income taxes for the nine months ended September 30, 2020, increasedprimarily due to net favorable claims experience across the segment. Foreign currency exchange fluctuations resulted in an increase in income before income taxes of $1 million and $2 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019.

Net premiums decreased by $3 million, or 0.5%, and $13 million, or 0.7%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. Premiums for the three months and nine months ended September 30, 2020, are reflective of new business growth in Asia, partially offset by premium reductions in Australia group business as a result of the non-renewal of two large group treaties effective June 30, 2020. ~~Foreign currency exchange fluctuations resulted~~

•The segment added new life business production, measured by face amount of insurance in ~~an increase in net premiums~~force, of ~~$6 million~~$7.1 billion and ~~a decrease of $22 million for the three and nine months of 2020, as compared to the same periods in 2019.~~

Net premiums earned from the reinsurance of critical illness (morbidity risk) in the segment, which is offered primarily in South Korea, Australia, China and Hong Kong, totaled $294 million and $294 million for$6.7 billion during the third quarter of 2021 and ~~$796 million~~2020, respectively, and ~~$789 million for~~$25.6 billion and $39.0 billion during the ~~first~~ nine months ended September 30, 2021 and 2020, respectively, due to new business production and ~~2019, respectively. Critical illness coverage provides a benefit~~in force transactions offset by lapses, recaptures and non-renewal of two large group treaties in Australia.

Benefits and expenses

•The increases in the ~~event of the diagnosis of a pre-defined critical illness.~~

~~Net investment income decreased by $5 million, or 18.5%, and $1 million, or 1.3%,~~loss ratio for the three and nine months ended September 30, ~~2020,~~2021, as compared to the same periods in ~~2019. The decrease for the third quarter was~~2020, were primarily due to ~~a lower investment yields. Foreign currency exchange fluctuations resulted~~unfavorable claims experience in ~~a decrease~~Asia, primarily in ~~net investment income~~India. While the cause of $2death is not yet available for all claims, the Company estimates that approximately $235 million of excess claims, of which approximately $218 million were incurred in India, for the nine months ended September 30, ~~2020, as compared to the same period in 2019.~~

Other revenues increased by $3 million, or 150.0%, and $5 million, or 83.3%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The increases are primarily related to recapture fees in Asia. Fluctuations in other revenues are driven by foreign currency gains and losses in each period.

~~Loss ratios for this segment~~2021, were 80.4% and 89.0% for the third quarter and 84.1% and 89.0% for the nine months ended September 30, 2020 and 2019, respectively. The decreases in the loss ratio for the third quarter and for the nine months ended September 30, 2020, as compared to the same period in 2019, were primarily due to favorable claims experience across the segment. Based on client reporting received to date, the impact of COVID-19 claims was not material to the segment during the third quarter of 2020.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were 5.1% and 6.1% for the third quarter and 6.1% and 4.1% for the nine months ended September 30, 2020 and 2019, respectively. The ratio of policy acquisition costs and other insurance expenses as a percentage of net premiums fluctuates periodically due to timing of client company reporting and variations in the mixture of business.

Other operating expenses increased $6 million, or 15.8%, and $3 million, or 2.5%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The increase for the three months ended September 30, 2020 is primarily attributable to growth in headcount across Asia to manage the business growth in the region, partially offset by lower travel expenses primarily attributable to COVID-19. The nine months ended September 30, 2020 also benefited from lower incentive-based compensation expense. Other operating expenses as a percentageCOVID-19 or COVID-19 related factors.

Table of net premiums totaled 6.7% and 6.1% for the third quarter and 6.5% and 6.4% for the first nine months ended September 30, 2020 and 2019, respectively. The timing of premium flows and the level of costs associated with the entrance into and development of new markets within the segment may cause other operating expenses as a percentage of net premiums to fluctuate over periods of time.Contents

Financial Solutions ~~Reinsurance~~

~~Income before income taxes increased by $8 million and $1 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019.~~


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in millions)	2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Revenues:
Net premiums	$	65	$	35	$	30	$	166	$	140	$	26
Investment income, net of related expenses	37		22		15		96		60		36
Investment related gains (losses), net	(15)		—		(15)		12		(18)		30
Other revenues	8		9		(1)		29		27		2
Total revenues	95		66		29		303		209		94
Benefits and expenses:
Claims and other policy benefits	52		33		19		140		127		13
Interest credited	12		13		(1)		42		37		5
Policy acquisition costs and other insurance expenses	19		5		14		41		24		17
Other operating expenses	6		5		1		15		10		5
Total benefits and expenses	89		56		33		238		198		40
Income (loss) before income taxes	$	6	$	10	$	(4)	$	65	$	11	$	54

The ~~increase~~decrease in income before income taxes for the third quarter was primarily due to ~~new business growth~~the decline in the fair value of derivatives, partially offset by the contributions from recently executed asset-intensive transactions in Asia. The increase in income before income taxes for the first nine months ~~ended September 30, 2020,~~of 2021 was due to ~~new business growth in Asia, partially offset by a decline in investment related gains (losses), net. Foreign currency exchange fluctuations resulted in an~~the increase in ~~income before income taxes~~the fair value of ~~$1 million for the nine months ended September 30, 2020, as compared to the same period in 2019.~~

~~Net premiums increased $5 million~~derivatives and ~~$32 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The increases were attributable to new~~contributions from recently executed asset-intensive transactions in Asia. ~~Foreign currency exchange fluctuations increased net premiums by $1 million for the nine months ended September 30, 2020, as compared to the same period in 2019.~~

Net investment income increased $12 million, or 120.0%, and $29 million, or 93.5%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019 primarily due to an increase in invested asset base, partially offset by lower investment yields. Foreign currency exchange fluctuations had a negligible impact on net investment income for the three and nine months ended September 30, 2020, as compared to the same periods in 2019.

Other revenues, which primarily represents fees earned on financial reinsurance transactions, increased by $2 million, or 28.6%, and $8 million, or 42.1%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. At September 30, 2020 and 2019, theThe amount of reinsurance assumed from client companies, as measured by pre-tax statutory surplus, risk based capital and other financial reinsurance structures was $1.4 billion and $2.9 billion for the nine months ended September 30, 2021 and ~~$3.3 billion,~~2020, respectively. Fees earned from this business can vary significantly depending on the size, complexity and timing of the transactions ~~and the timing of their completion~~ and, therefore, can fluctuate from period to period.

~~Claims and other policy benefits increased by $5 million and $30 million~~Revenues

•The increase in net premiums for the three and nine months ended September 30, ~~2020, as compared~~2021, is primarily due to ~~the same periods~~contributions from single premium asset-intensive transactions.

•The increase in ~~2019. The increases were attributable to new asset-intensive transactions in Asia.~~

~~Other operating expenses increased by $1 million, or 25.0%, and decreased by $3 million, or 23.1%,~~investment income for the three and nine months ended September 30, ~~2020, as compared to the same periods in 2019, respectively. The increase in other operating expense~~2021, is primarily due to ~~new business growth partially offset by lower travel and other expenses primarily attributable to COVID-19.~~ the contributions from recently executed asset-intensive transactions in Asia.

•The decrease in investment related gains (losses), net for the ~~first~~third quarter is primarily due to the decrease in fair value of derivatives as a result of higher expected interest rates. The increase in investment related gains (losses), net for the nine month period ended September 30, 2021, is primarily due to an increase in the fair value of derivatives as a result of lower expected interest rates and tightening credit spreads.

Benefits and expenses

•The increase in claims and other policy benefits, and policy acquisition costs and other insurance expenses for the three and nine months ended September 30, 2021, is ~~related to lower travel expenses primarily attributable to COVID-19 as well as lower incentive-based compensation expense. The timing~~the result of transactions and the level of costs associated with the entrance into and development of new markets and new transactions within the segment may cause other operating expenses to fluctuate over periods of time.increased production from single premium asset-intensive transactions.

Corporate and Other

Corporate and Other revenues primarily include investment income from unallocated invested assets, investment related gains and losses and service fees. Corporate and Other expenses consist of the offset to capital charges allocated to the operating segments within the policy acquisition costs and other insurance income line item, unallocated overhead and executive costs, interest expense related to debt, and the investment income and expense associated with the Company’s collateral finance and securitization transactions and service business expenses. Additionally, Corporate and Other includes results from certain wholly-owned subsidiaries, such as ~~RGAx,~~RGAX, and joint ventures that, among other activities, develop and market technology, and provide consulting and outsourcing solutions for the insurance and reinsurance industries. The Company has increased its investment and expenditures in this area in an effort to both support its clients and accelerate the development of new solutions and services to increase consumer engagement within the life insurance ~~industry.~~industry and hence generate new future revenue streams.

Table of Contents


(dollars in millions)	Three months ended September 30,						Nine months ended September 30,						(dollars in millions)	Three months ended September 30,						Nine months ended September 30,
	2020			2019			2020			2019				2021		2020		2021 vs 2020		2021		2020		2021 vs 2020
Revenues:													Revenues:
Net premiums	$	—		$	—		$	—		$	—		Net premiums	$	—	$	—	$	—	$	—	$	—	$	—
Investment income, net of related expenses	41			51			147			149			Investment income, net of related expenses	52		41		11		258		147		111
Investment related gains (losses), net	9			(1		)	(36		)	(8		)	Investment related gains (losses), net	42		9		33		379		(36)		415
Other revenues	17			10			38			49			Other revenues	15		17		(2)		54		38		16
Total revenues	67			60			149			190			Total revenues	109		67		42		691		149		542
Benefits and expenses:													Benefits and expenses:
Claims and other policy benefits	1			—			1			—			Claims and other policy benefits	—		1		(1)		—		1		(1)
Interest credited	2			4			7			15			Interest credited	1		2		(1)		3		7		(4)
Policy acquisition costs and other insurance income	(27		)	(29		)	(84		)	(87		)	Policy acquisition costs and other insurance income	(27)		(27)		—		(81)		(84)		3
Other operating expenses	70			73			201			219			Other operating expenses	75		70		5		231		201		30
Interest expense	43			46			126			129			Interest expense	41		43		(2)		129		126		3
Collateral finance and securitization expense	4			7			14			23			Collateral finance and securitization expense	3		4		(1)		8		14		(6)
Total benefits and expenses	93			101			265			299			Total benefits and expenses	93		93		—		290		265		25
Income (loss) before income taxes	$	(26	)	$	(41	)	$	(116	)	$	(109	)	Income (loss) before income taxes	$	16	$	(26)	$	42	$	401	$	(116)	$	517

~~Income (loss)~~The increase in income before income taxes ~~increased~~for the three and nine month periods ended September 30, 2021, is primarily due to an increase in total revenues. Year-to-date increases in revenues were partially offset by ~~$15 million and decreased by $7 million~~an increase in other operating expenses.

•The increase in net investment income for the three and nine months ended September 30, ~~2020, as compared~~2021, is primarily due to higher variable investment income associated with investments in limited partnerships generated from unrealized gains in the ~~same periods in 2019.~~underlying investments. The increase in the nine months ended September 30, 2021, includes a reclassification recorded in the first quarter of approximately $92 million of pre-tax unrealized gains on certain limited partnerships, for which the Company uses the equity method of accounting, from AOCI to net investment income ~~(loss) before~~that should have been recognized directly in net investment income ~~taxes for~~in the ~~third quarter was primarily due to increases~~same prior periods they were reported as earnings by the investees.

•The increase in investment related gains and other revenues, and a decrease in total benefits and expenses, partially offset by lower investment income. The decrease in income (loss) before income taxes for the first nine months was primarily due to an increase in investment related losses and a decrease in other revenue, partially offset by lower other operating expenses.

~~Net investment income decreased by $10 million, or 19.6%~~(losses), ~~and $2 million, or 1.3%,~~net for the three and nine months ended September 30, ~~2020, as compared~~2021, includes $24 million and $155 million, respectively, of changes in the carrying value of investments in limited partnerships considered to be investment companies. Recognized in the first quarter of 2021 were changes of $70 million relate to an adjustment to the ~~same periods~~carrying value from cost less impairments to a fair value approach, using the NAV per share or its equivalent, which should have been recognized in ~~2019.~~prior periods. The ~~decreases in the third quarter and first nine months were largely attributable to lower yield on unallocated invested assets and higher cash balances, partially offset by an~~remaining increase ~~in unallocated invested asset base.~~

~~Net investment related gains (losses) increased by $10 million and decreased by $28 million~~ for the three and nine months ended September 30, ~~2020, as compared~~2021, is attributable to ~~the same periods in 2019. The increase in the third quarter~~ gains ~~was primarily due to~~on sales of fixed maturity securities, a decrease in the allowance for credit losses on ~~fixed maturity securities available-for-sale~~mortgage loans as a result of ~~$12 million~~assumption updates due to the improving view of the impact of the COVID-19 pandemic, and ~~favorable fluctuations~~changes in the fair value of derivatives ~~partially offset by losses on~~and equity securities.

•The increase in other operating expenses for the ~~sale of fixed maturity securities and lower variable investment income from limited partnerships, which can be highly variable from period to period. The decrease in the first~~ nine months ~~of 2020~~ended September 30, 2021, was primarily due to an increase in the valuation allowance on mortgage loans of $16 million, primarily attributable to the economic uncertainty caused by COVID-19, decreases in the fair value of equity securities and lower variable investment income from limited partnerships, which can be highly variable from period to period, partially offset by favorable fluctuations in the fair value of derivatives.

Other revenues increased by $7 million and decreased by $11 million for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The increase in the third quarter was primarily due to favorable foreign exchange rate fluctuations. The decrease in the first nine months of 2020 was mainly due to changes in the cash surrender value of corporate owned life insurance policies, partially offset by favorable foreign exchange rate fluctuations. Additionally, prior year results included a recapture of a collateral finance transaction, which resulted in a $13 million fee paid to the Company. The Company’s RGAx operations contributed $12 million and $31 million to other revenues for the three and nine months ended September 30, 2020 compared to $12 million and $38 million in the prior year periods.

Policy acquisition costs and other insurance expense increased $2 million, or 6.9%, and $3 million, or 3.4%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. Fluctuations period over period were attributable to the offset to capital charges allocated to the operating segments.

Other operating expenses decreased by $3 million, or 4.1%, and $18 million, or 8.2%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decrease in other operating expenses for both periods presented was primarily due to lower incentive-basedincentive compensation ~~expense as well as lower travel expenses, consulting fees and contract labor expenses.~~expense.

Interest expense decreased by $3 million, or 6.5%, and $3 million, or 2.3%, for the three and nine months ended September 30, 2020, as compared to the same periods in 2019. The decrease in interest expense was primarily due to decreases in tax-related interest expense, partially offset by higher interest expense due the 2020 debt issuance.

Liquidity and Capital Resources

Overview

The Company believes that cash flows from the source of funds available to it will provide sufficient cash flows for the next twelve months to satisfy the current liquidity requirements of the Company under various scenarios that include the potential risk of early recapture of reinsurance treaties, market events and higher than expected claims associated with the pandemic. Given the uncertainty associated with the COVID-19 pandemic and the related volatility in the financial markets, the Company ~~increased its~~continues to maintain a higher cash and cash ~~equivalents to $3.3 billion as of September 30, 2020, compared to $1.4 billion as of December 31, 2019, an increase of $1.9 billion.~~equivalent balance than its historical balances. The Company performs periodic liquidity stress testing to ensure its asset portfolio includes sufficient high quality liquid assets that could be utilized to bolster its liquidity position under stress scenarios. These assets could be utilized as collateral for secured borrowing transactions with various third parties or by selling the securities in the open market if needed. The Company’s liquidity requirements have been and will continue to be funded through net cash flows from operations. However, in the event of significant unanticipated cash requirements, the Company has multiple liquidity alternatives available based on market conditions and the amount and timing of the liquidity need. These alternatives include borrowings under committed credit facilities, secured borrowings, the ability to issue long-term debt, preferred securities or common equity and, the sale of invested assets subject to market conditions.

In order to enhance the Company’s strong capital and liquidity position, the Company executed two capital market transactions during the second quarter. On June 5, 2020, the Company completed an offering

Table of ~~its common stock and received net proceeds of $481 million, and on June 9, 2020, completed a senior debt offering and received net proceeds of $593 million.~~Contents

Current Market Environment

~~The current low interest rate environment in the Company’s primary geographical markets continues to put downward pressure on the Company’s investment yield.~~ The Company’s average investment yield, excluding spread business, for the nine months ended September 30, ~~2020,~~2021, was ~~3.93%~~5.08%, 64115 basis points ~~below~~higher compared to the same period in ~~2019 due~~2020. The increase in average yield is primarily attributable to the ~~continuing low~~aforementioned accounting correction associated with equity method limited partnerships and an increase in the average invested asset base and overall yield, primarily attributable to an increase in variable investment income in the current year. However, the current interest rate environment ~~high cash balances and lower income from limited partnerships.~~continues to put downward pressure on the Company’s investment yield. The Company’s insurance liabilities, in particular its annuity products, are sensitive to changing market factors. Gross unrealized gains on fixed maturity securities available-for-sale ~~increased~~decreased from ~~$4.5~~$7.4 billion at December 31, ~~2019~~2020, to ~~$6.4~~$5.3 billion at September 30, ~~2020.~~2021. Similarly, gross unrealized losses increased from ~~$110~~$197 million at December 31, ~~2019~~2020, to ~~$370~~$326 million at September 30, ~~2020.~~2021.

The Company continues to be in a position to hold any investment security showing an unrealized loss until recovery, provided it remains comfortable with the credit of the issuer. As indicated above, gross unrealized gains on fixed maturity securities of ~~$6.4~~$5.3 billion remain well in excess of gross unrealized losses of ~~$370~~$326 million as of September 30, ~~2020.~~2021. The Company does not rely on short-term funding or commercial paper and to date it has experienced no liquidity pressure, nor does it anticipate such pressure in the foreseeable future.

The Company projects its reserves to be sufficient, and it would not expect to write down deferred acquisition costs or be required to take any actions to augment capital, even if interest rates remain at current levels for the next five years, assuming all other factors remain constant. While the Company has felt the pressures of sustained low interest rates and volatile equity markets and may continue to do so, its business and results of operations are not overly sensitive to these risks. Mortality and morbidity risks continue to be the most significant risk for the Company. Although management believes the Company’s current capital base is adequate to support its business at current operating levels, it continues to monitor new business opportunities and any associated new capital needs that could arise from the changing financial landscape.

The Holding Company

RGA is an insurance holding company whose primary uses of liquidity include, but are not limited to, the immediate capital needs of its operating companies, dividends paid to its shareholders, repurchase of common stock and interest payments on its indebtedness. The primary sources of RGA’s liquidity include proceeds from its capital-raising efforts, interest income on undeployed corporate investments, interest income received on surplus notes with RGA Reinsurance, RCM and Rockwood Re and dividends from operating subsidiaries. Total interest and dividend income increased by $327 million for the nine months ended September 30, 2020, as compared to the same period in 2019 primarily due to cash dividends received from operating subsidiaries during the first half of the current year. As the Company continues its growth efforts, RGA will continue to be dependent upon these sources of liquidity. The following tables provide comparative information for RGA (dollars in millions):


	Three months ended September 30,				Nine months ended September 30,
	2021		2020		2021		2020
Interest and dividend income	$	303	$	21	$	367	$	429
Interest expense	47		35		150		135
Capital contributions to subsidiaries	5		13		12		46
Issuance of unaffiliated debt	—		—		—		598
Dividends to shareholders	50		47		145		134
Issuance of common stock, net of expenses	—		—		—		481
Purchase of treasury stock	46		—		48		153

Three months ended September 30, Nine months ended September 30,
2020 2019 2020 2019
Interest and dividend income $ 21
$ 36
$ 429
$ 102
Interest expense 35
54
135
154
Capital contributions to subsidiaries 13
12
46
51
Issuance of unaffiliated debt —
—
598
599
Dividends to shareholders 47
44
134
119
Issuance of common stock, net of expenses —
—
481
—
Repurchases of treasury stock —
30
153
80

September 30, 2020 December 31, 2019
Cash and invested assets $ 1,414
$ 554


	September 30, 2021		December 31, 2020
Cash and invested assets	$	615	$	1,308

See Item 15, Schedule II – “Condensed Financial Information of the Registrant” in the ~~2019~~2020 Annual Report for additional financial information related to RGA.

The undistributed earnings of substantially all of the Company’s foreign subsidiaries have been reinvested indefinitely in those non-U.S. operations, as described in Note 9 – “Income Tax” in the Notes to Consolidated Financial Statements in the ~~2019~~2020 Annual Report. As U.S. Tax Reform generally eliminates U.S. federal income taxes on dividends from foreign subsidiaries, the Company does not expect to incur material income taxes if these funds are repatriated.

RGA endeavors to maintain a capital structure that provides financial and operational flexibility to its subsidiaries, credit ratings that support its competitive position in the financial services marketplace, and shareholder returns. As part of the Company’s capital deployment strategy, it has in recent years repurchased shares of RGA common stock and paid dividends to RGA shareholders, as authorized by the board of directors. RGA’s current share repurchase program, which was approved by the board of directors in January 2019, authorizes the repurchase of up to $400 million of common stock. On ~~May 6, 2020,~~August 3, 2021, the Company announced ~~that is has suspended~~the lifting of the existing suspension on share repurchases. During the nine months ended September 30, 2021, RGA repurchased 405,644 shares of common stock ~~repurchases until further notice.~~under this program for $46 million. During the nine months ended September 30, 2020, RGA repurchased 1,074,413 shares of common stock under this program for $153 million. The pace of

Table of Contents

repurchase activity depends on various factors such as the level of available cash, an evaluation of the costs and benefits associated with alternative uses of excess capital, such as acquisitions and in force reinsurance transactions, and RGA’s stock price.

Details underlying dividend and share repurchase program activity were as follows (in millions, except share data):


	Nine months ended September 30,
	2021		2020
Dividends to shareholders	$	145	$	134
Purchase of treasury stock (1)	46		153
Total amount paid to shareholders	$	191	$	287

Number of treasury shares purchased (1)	406		1,074
Average price per share	$	113.40	$	142.05

Nine months ended September 30,
2020 2019
Dividends to shareholders $ 134
$ 119
Repurchases of treasury stock 153
80
Total amount paid to shareholders $ 287
$ 199

Number of shares repurchased 1,074
547
Average price per share $ 142.05
$ 146.00
(1)Excludes shares utilized to execute and settle certain stock incentive awards.

On June 5, 2020, the Company completed a public offering of 6,172,840 shares of common stock, $0.01 par value per share, at a public offering price of $81.00 per share. The Company received net proceeds of approximately $481 million. The Company granted the underwriters an option to purchase from the Company, within 30 days after the underwriting Agreement dated June 2, 2020, up to an additional 925,926 shares of common stock at the offering price of $81.00 per share. The underwriters’ option was not exercised and expired on July 2, 2020. The Company ~~anticipates using~~utilized the net proceeds of the offering for general corporate purposes.

In October ~~2020,~~2021, RGA’s board of directors declared a quarterly dividend of ~~$0.70~~$0.73 per share. All future payments of dividends are at the discretion of RGA’s board of directors and will depend on the Company’s earnings, capital requirements, insurance regulatory conditions, operating conditions, and other such factors as the board of directors may deem relevant. The amount of dividends that RGA can pay will depend in part on the operations of its reinsurance subsidiaries. See Note 3 – “Equity” in the Notes to Condensed Consolidated Financial Statements for information on the Company’s share repurchase program.

Debt

Certain of the Company’s debt agreements contain financial covenant restrictions related to, among others, liens, the issuance and disposition of stock of restricted subsidiaries, minimum requirements of consolidated net worth, maximum ratios of debt to capitalization and change of control provisions. The Company is required to maintain a minimum consolidated net worth, as defined in the debt agreements, of $5.3 billion, calculated as of the last day of each fiscal quarter. Also, consolidated indebtedness, calculated as of the last day of each fiscal quarter, cannot exceed 35% of the sum of the Company’s consolidated indebtedness plus adjusted consolidated stockholders’ equity. A material ongoing covenant default could require immediate payment of the amount due, including principal, under the various agreements. Additionally, the Company’s debt agreements contain cross-acceleration covenants, which would make outstanding borrowings immediately payable in the event of a material uncured covenant default under any of the agreements, including, but not limited to, non-payment of ~~certain other~~ indebtedness when ~~demanded, and~~due for an amount in excess of the amounts set forth in those agreements, bankruptcy proceedings, or any other event ~~which~~that results in the acceleration of the maturity of ~~such other~~ indebtedness.

As of September 30, ~~2020~~2021 and December 31, ~~2019,~~2020, the Company had ~~$3.6~~$3.2 billion and ~~$3.0~~$3.6 billion, respectively, in outstanding borrowings under its debt agreements and was in compliance with all covenants under those agreements. As of September 30, ~~2020~~2021 and December 31, ~~2019,~~2020, the average net interest rate on long-term debt outstanding was ~~4.54%~~4.48% and ~~4.82%~~4.54%, respectively. The ability of the Company to make debt principal and interest payments depends on the earnings and surplus of subsidiaries, investment earnings on undeployed capital proceeds, available liquidity at the holding company, and the Company’s ability to raise additional funds.

On June 9, 2020, RGA issued 3.15% Senior Notes due June 15, 2030, with a face amount of $600 million. This security has been registered with the Securities and Exchange Commission. The net proceeds were approximately $593 million and ~~will be~~were used in part to repay the Company’s $400 million ~~5.000%~~5.00% senior notes due in the second quarter of 2021, and the remainder ~~will be used for general corporate purposes. Capitalized issue costs were approximately $5 million.~~

On May 15, 2019, RGA issued 3.9% Senior Notes due May 15, 2029, with a face amount of $600 million. This security has been registered with the Securities and Exchange Commission. The net proceeds were approximately $594 million and were used in part to repay upon maturity the Company’s $400 million 6.45% Senior Notes that mature in November 2019. The remainder will bewas used for general corporate purposes. Capitalized issue costs were approximately $5 million.

The Company enters into derivative agreements with counterparties that reference either the Company’s debt rating or its financial strength rating. If either rating is downgraded in the future, it could trigger certain terms in the Company’s derivative agreements, which could negatively affect overall liquidity. For the majority of the Company’s derivative agreements, there is a termination event should the long-term senior debt ratings drop below either BBB+ (S&P) or Baa1 (Moody’s) or the financial strength ratings drop below either A- (S&P) or A3 (Moody’s).

Table of Contents

The Company may borrow up to $850 million in cash and obtain letters of credit in multiple currencies on its revolving credit facility that matures in August 2023. As of September 30, ~~2020,~~2021, the Company had no cash borrowings outstanding and $21 million in issued, but undrawn, letters of credit under this facility.

Based on the historic cash flows and the current financial results of the Company, management believes RGA’s cash flows will be sufficient to enable RGA to meet its obligations for at least the next 12twelve months.

Credit and Committed Facilities

At September 30, ~~2020,~~2021, the Company maintained an $850 million syndicated revolving credit facility and certain committed letter of credit facilities aggregating to $1.1 billion. See Note 13 – “Debt” in the Notes to Consolidated Financial Statements in the ~~2019~~2020 Annual Report for further information about these facilities.

The Company has obtained bank letters of credit in favor of various affiliated and unaffiliated insurance companies from which the Company assumes business. These letters of credit represent guarantees of performance under the reinsurance agreements and allow ceding companies to take statutory reserve credits. Certain of these letters of credit contain financial covenant restrictions similar to those described in the “Debt” discussion above. At September 30, ~~2020,~~2021, there were approximately ~~$23~~$22 million of outstanding bank letters of credit in favor of third parties. Additionally, in accordance with applicable regulations, the Company utilizes letters of credit to secure statutory reserve credits when it retrocedes business to its affiliated subsidiaries. The Company cedes business to its affiliates to help reduce the amount of regulatory capital required in certain jurisdictions, such as the U.S. and the UK. The Company believes the capital required to support the business in the affiliates reflects more realistic expectations than the original jurisdiction of the business, where capital requirements are often considered to be quite conservative. As of September 30, ~~2020,~~2021, $1.5 billion in letters of credit from various banks were outstanding, but undrawn, backing reinsurance between the various subsidiaries of the Company.

Cash Flows

The Company’s principal cash inflows from its reinsurance operations include premiums and deposit funds received from ceding companies. The primary liquidity concerns with respect to these cash flows are early recapture of the reinsurance contract by the ceding company and lapses of annuity products reinsured by the Company. The Company’s principal cash inflows from its invested assets result from investment income and the maturity and sales of invested assets. The primary liquidity concerns with respect to these cash inflows relates to the risk of default by debtors and interest rate volatility. The Company manages these risks very closely. See “Investments” and “Interest Rate Risk” below.

Additional sources of liquidity to meet unexpected cash outflows in excess of operating cash inflows and current cash and equivalents on hand ~~include selling short-term investments or fixed maturity securities and~~also includes drawing funds under a revolving credit facility, under which the Company had availability of $829 million as of September 30, ~~2020.~~2021. The Company also has ~~$544~~$574 million of funds available through collateralized borrowings from the FHLB as of September 30, ~~2020.~~2021. As of September 30, ~~2020,~~2021, the Company could have borrowed these additional amounts without violating any of its existing debt covenants.

The Company’s principal cash outflows relate to the payment of claims liabilities, interest credited, operating expenses, income taxes, dividends to shareholders, purchases of treasury stock and principal and interest under debt and other financing obligations. The Company seeks to limit its exposure to loss on any single insured and to recover a portion of benefits paid by ceding reinsurance to other insurance enterprises or reinsurers under excess coverage and coinsurance contracts (See Note 2 – “Significant Accounting Policies and Pronouncements” in the Notes to Consolidated Financial Statements in the ~~2019~~2020 Annual Report). The Company performs annual financial reviews of its retrocessionaires to evaluate financial stability and performance. The Company has never experienced a material default in connection with retrocession arrangements, nor has it experienced any difficulty in collecting claims recoverable from retrocessionaires; however, no assurance can be given as to the future performance of such retrocessionaires nor to the recoverability of future claims. The Company’s management believes its cash and cash equivalents along with its current sources of liquidity are adequate to meet its cash requirements for the next ~~12 months.~~twelve months, despite the uncertainty associated with the pandemic.

Table of Contents

Summary of Primary Sources and Uses of Liquidity and Capital

The Company’s primary sources and uses of liquidity and capital are summarized as follows:


		Nine months ended September 30,						For the nine months ended September 30,
		2020		2019				2021		2020
		(Dollars in millions)						(Dollars in millions)
Sources:	Sources:					Sources:
							Net cash provided by operating activities	$	3,821	$	2,779
	Net cash provided by operating activities	$	2,779	$	1,764
	Proceeds from issuance of common stock, net	481		—			Proceeds from issuance of common stock, net	—		481
	Proceeds from long-term debt issuance	598		599			Proceeds from long-term debt issuance	—		598
	Exercise of stock options, net	1		4			Exercise of stock options, net	—		1
	Change in cash collateral for derivative positions and other arrangements	28		—			Change in cash collateral for derivative positions and other arrangements	29		28
	Cash provided by changes in universal life and other						Change in deposit asset on reinsurance	14		—
	investment type policies and contracts	617		—			Net deposits from investment-type policies and contracts	—		617
	Effect of exchange rate changes on cash	8		—			Effect of exchange rate changes on cash	—		8
	Total sources	4,512		2,367			Total sources	3,864		4,512

Uses:	Uses:					Uses:
	Net cash used in investing activities	2,214		981			Net cash used in investing activities	3,492		2,214
	Dividends to stockholders	134		119			Dividends to stockholders	145		134
	Repayment of collateral finance and securitization notes	188		77			Repayment of collateral finance and securitization notes	74		188
	Debt issuance costs	5		5			Debt issuance costs	—		5
	Principal payments of long-term debt	2		2			Principal payments of long-term debt	402		2
	Purchases of treasury stock	162		98
	Change in cash collateral for derivatives and other arrangements	—		67			Purchases of treasury stock	48		162
	Cash used for changes in universal life and other
	investment type policies and contracts	—		254
	Effect of exchange rate changes on cash	—		18
	Total uses	2,705		1,621			Net withdrawals from investment-type policies and contracts	51		—
							Effect of exchange rate changes on cash	33		—
							Total uses	4,245		2,705
Net change in cash and cash equivalents	Net change in cash and cash equivalents	$	1,807	$	746	Net change in cash and cash equivalents		$	(381)	$	1,807

Cash Flows from Operations – The principal cash inflows from the Company’s reinsurance activities come from premiums, investment and fee income, annuity considerations and deposit funds. The principal cash outflows relate to the liabilities associated with various life and health insurance, annuity and disability products, operating expenses, income tax payments and interest on outstanding debt obligations. The primary liquidity concern with respect to these cash flows is the risk of shortfalls in premiums and investment income, particularly in periods with abnormally high claims levels.

Cash Flows from Investments – The principal cash inflows from the Company’s investment activities come from repayments of principal on invested assets, proceeds from maturities of invested assets, sales of invested assets and settlements of freestanding derivatives. The principal cash outflows relate to purchases of investments, issuances of policy loans and settlements of freestanding derivatives. The Company typically has a net cash outflow from investing activities because cash inflows from insurance operations are reinvested in accordance with its asset/liability management discipline to fund insurance liabilities. The Company closely monitors and manages these risks through its credit risk management process. The primary liquidity concerns with respect to these cash flows are the risk of default by debtors and market disruption, which could make it difficult for the Company to sell investments.

Financing Cash Flows – The principal cash inflows from the Company’s financing activities come from issuances of RGA debt and equity securities, and deposit funds associated with universal life and other investment type policies and contracts. The principal cash outflows come from repayments of debt, payments of dividends to stockholders, purchases of treasury stock, and withdrawals associated with universal life and other investment type policies and contracts. A primary liquidity concern with respect to these cash flows is the risk of early contractholder and policyholder withdrawal.

Table of Contents

Contractual Obligations

The Company’s obligation for long-term debt, including interest, increased by $492 million since December 31, 2019, primarily related to the June 2020 issuance of senior notes as previously discussed. The Company’s obligation for collateral financing decreased by $222 million since December 31, 2019, as a result of a repayment during 2020. The Company’s obligation for other investment related commitments decreased by $191 million since December 31, 2019, primarily related to a decrease in the Company’s commitment to fund investments of commercial mortgage loans as well as bank loans and private placements. There were no other material changes in the Company’s contractual obligations from those reported in the ~~2019~~2020 Annual ~~Report.~~Report, except for the following:

•The Company’s contractual obligations associated with interest sensitive liabilities increased from $37.1 billion at December 31, 2020, to $41.5 billion as of September 30, 2021, primarily due to a large asset-intensive transaction completed in the second quarter. The majority of the payments due under these commitments are expected to occur beyond five years.

•The Company’s contractual obligations associated with limited partnerships and other investment related commitments increased from $1.1 billion at December 31, 2020, to $1.9 billion as of September 30, 2021, primarily due to an increase in new investment opportunities in the current period. The majority of the payments due under these commitments are expected to occur within the next twelve months.

Asset / Liability Management

The Company actively manages its cash and invested assets using an approach that is intended to balance quality, diversification, asset/liability matching, liquidity and investment return. The goals of the investment process are to optimize after-tax, risk-adjusted investment income and after-tax, risk-adjusted total return while managing the assets and liabilities on a cash flow and duration basis.

The Company has established target asset portfolios for its operating segments, which represent the investment strategies intended to profitably fund its liabilities within acceptable risk parameters. These strategies include objectives and limits for effective duration, yield curve sensitivity and convexity, liquidity, asset sector concentration and credit quality.

The Company’s asset-intensive products are primarily supported by investments in fixed maturity securities reflected on the Company’s balance sheet and under funds withheld arrangements with the ceding company. Investment guidelines are established to structure the investment portfolio based upon the type, duration and behavior of products in the liability portfolio so as to achieve targeted levels of profitability. The Company manages the asset-intensive business to provide a targeted spread between the interest rate earned on investments and the interest rate credited to the underlying interest-sensitive contract liabilities. The Company periodically reviews models projecting different interest rate scenarios and their effect on profitability. Certain of these asset-intensive agreements, primarily in the U.S. and Latin America Financial Solutions operating segment, are generally funded by fixed maturity securities that are withheld by the ceding company.

The Company’s liquidity position (cash and cash ~~equivalents)~~equivalents and short-term investments) was ~~$3.3~~$3.1 billion and ~~$1.4~~$3.6 billion at September 30, ~~2020~~2021 and December 31, ~~2019,~~2020, respectively. Given the uncertainty associated with the COVID-19 pandemic and the related volatility in the financial markets, the Company has increased its liquidity position. Liquidity needs are determined from valuation analyses conducted by operational units and are driven by product portfolios. Periodic evaluations of demand liabilities and short-term liquid assets are designed to adjust specific portfolios, as well as their durations and maturities, in response to anticipated liquidity needs.

See “Securities Borrowing, Lending and Other” in Note 4 – “Investments” in the Notes to Condensed Consolidated Financial Statements for information related to the Company’s securities borrowing, lending and repurchase/reverse repurchase programs. In addition to its security agreements with third parties, certain RGA’s subsidiaries have entered into intercompany securities lending agreements to more efficiently source securities for lending to third parties and to provide for more efficient regulatory capital management.

The Company is a member of the FHLB and holds ~~$89~~$77 million of FHLB common stock, which is included in other invested assets on the Company’s condensed consolidated balance sheets.

The Company has entered into funding agreements with the FHLB under guaranteed investment contracts whereby the Company has issued the funding agreements in exchange for cash and for which the FHLB has been granted a blanket lien on the Company’s commercial and residential mortgage-backed securities and commercial mortgage loans used to collateralize the Company’s obligations under the funding agreements. The Company maintains control over these pledged assets, and may use, commingle, encumber or dispose of any portion of the collateral as long as there is no event of default and the remaining qualified collateral is sufficient to satisfy the collateral maintenance level. The funding agreements and the related security agreements represented by this blanket lien provide that upon any event of default by the Company, the FHLB’s recovery is limited to the amount of the Company’s liability under the outstanding funding agreements. The amount of the Company’s liability for the funding agreements with the FHLB under guaranteed investment contracts was ~~$1.9~~$1.6 billion and ~~$1.4~~$1.9 billion at September 30, ~~2020~~2021 and December 31, ~~2019, respectively,~~2020, which is included in interest-sensitive contract liabilities on the Company’s condensed consolidated balance sheets. The advances on these agreements are collateralized primarily by commercial and residential mortgage-backed securities, commercial mortgage loans, and U.S. Treasury and government agency securities. The

Table of Contents

amount of collateral exceeds the liability and is dependent on the type of assets collateralizing the guaranteed investment contracts.

Investments

Management of Investments

The Company’s investment and derivative strategies involve matching the characteristics of its reinsurance products and other obligations and to seek to closely approximate the interest rate sensitivity of the assets with estimated interest rate sensitivity of the reinsurance liabilities. The Company achieves its income objectives through strategic and tactical asset allocations, security and derivative strategies within an asset/liability management and disciplined risk management framework. Derivative strategies are employed within the Company’s risk management framework to help manage duration, currency, and other risks in assets and/or liabilities and to replicate the credit characteristics of certain assets.

~~Table of Contents~~

The Company’s portfolio management groups work with the Enterprise Risk Management function to develop the investment policies for the assets of the Company’s domestic and international investment portfolios. All investments held by the Company, directly or in a funds withheld at interest reinsurance arrangement, are monitored for conformance with the Company’s stated investment policy limits as well as any limits prescribed by the applicable jurisdiction’s insurance laws and regulations. See Note 4 – “Investments” in the Notes to Condensed Consolidated Financial Statements for additional information regarding the Company’s investments.

Effects of COVID-19

~~The Company’s investment portfolios have been, and may continue~~Credit markets continued to ~~be, adversely affected by~~recover during the ~~recent~~first nine months of 2021 following the disruption in the global financial markets caused by the COVID-19 and uncertainty regarding its outcome. Changes in interest rates, increased market volatility or a continued slowdown in U.S. or global economic conditions may also adversely affect the values and cash flows of these assets in future periods. The Company’s corporate fixed income portfolio may be adversely impacted by ratings downgrades, increased bankruptcies and credit spread widening in distressed industries.pandemic. The Company has exposure to some of the asset classes and industries most affected by the COVID-19 pandemic such as commercial mortgage loans, emerging market debt, energy, and airlines; however, the Company’s primary exposure in these asset classes is of high quality assets. The Company ~~recognized impairments on limited partnership investments~~continues to monitor and ~~available-for-sale securities, and increased~~evaluate the credit allowance for its available-for-sale securities primarily related to high-yield energy, emerging market, and mezzanine debt securities during the three and nine months ended September 30, 2020. The Company also increased the valuation allowance on its commercial mortgage loan portfolio as resultimpact of ~~the negative impact~~ the COVID-19 pandemic ~~has had~~ on ~~the Company’s borrowers.~~its investment portfolio and is working closely with its borrowers to evaluate any short-term cash flow issues.

Portfolio Composition

The Company had total cash and invested assets of ~~$73.4~~$80.6 billion and ~~$68.0~~$75.8 billion as of September 30, ~~2020~~2021 and December 31, ~~2019,~~2020, respectively, as illustrated below (dollars in millions):


	September 30, 2021		% of Total		December 31, 2020		% of Total
Fixed maturity securities, available-for-sale	$	59,289	73.6	%	$	56,735	74.8	%
Equity securities	160		0.2		132		0.2
Mortgage loans on real estate	6,366		7.9		5,787		7.6
Policy loans	1,234		1.5		1,258		1.7
Funds withheld at interest	7,034		8.7		5,432		7.2
Short-term investments	82		0.1		227		0.3
Other invested assets	3,404		4.2		2,829		3.7
Cash and cash equivalents	3,027		3.8		3,408		4.5
Total cash and invested assets	$	80,596	100.0	%	$	75,808	100.0	%

September 30, 2020 % of Total December 31, 2019 % of Total
Fixed maturity securities, available-for-sale $ 54,652
74.5 % $ 51,121
75.3 %
Equity securities 135
0.2
320
0.5
Mortgage loans on real estate 5,907
8.0
5,706
8.3
Policy loans 1,259
1.7
1,319
1.9
Funds withheld at interest 5,403
7.4
5,662
8.3
Short-term investments 154
0.2
64
0.1
Other invested assets 2,645
3.6
2,363
3.5
Cash and cash equivalents 3,256
4.4
1,449
2.1
Total cash and invested assets $ 73,411
100.0 % $ 68,004
100.0 %

Table of Contents

Investment Yield

The following table presents consolidated average invested assets, at amortized cost, net investment income, investment yield, variable investment income (“VII”), and investment yield excluding VII, which can vary significantly from period to period (dollars in millions). The table excludes spread related business. Spread related business is primarily associated with contracts on which the Company earns an interest rate spread between assets and liabilities. To varying degrees, fluctuations in the yield on other spread related business is generally subject to corresponding adjustments to the interest credited on the ~~liabilities (dollars in millions).~~liabilities.


	Three months ended September 30,								Nine months ended September 30,									Three months ended September 30,								Nine months ended September 30,
	2020			2019			Increase/ (Decrease)		2020			2019			Increase/ (Decrease)			2021			2020			Increase/ (Decrease)		2021			2020			Increase/ (Decrease)
Average invested assets at amortized cost	$	32,148		$	29,043		10.7	%	$	30,468		$	28,222		8.0	%	Average invested assets at amortized cost	$	33,361		$	32,148		$	1,213	$	33,021		$	30,468		$	2,553
Net investment income	290			344			(15.7	)%	894			961			(7.0	)%	Net investment income	$	405		$	290		$	115	$	1,251		$	894		$	357
Investment yield (ratio of net investment income to average invested assets)	3.66		%	4.83		%	(117) bps		3.93		%	4.57		%	(64) bps
Annualized investment yield (ratio of net investment income to average invested assets at amortized cost)																	Annualized investment yield (ratio of net investment income to average invested assets at amortized cost)	4.95		%	3.66		%	129 bps		5.08		%	3.93		%	115 bps
VII (included in net investment income)																	VII (included in net investment income)	$	102		$	8		$	94	$	342		$	27		$	315
Annualized investment yield excluding VII (ratio of net investment income, excluding VII, to average invested assets, excluding assets with only VII, at amortized cost)																	Annualized investment yield excluding VII (ratio of net investment income, excluding VII, to average invested assets, excluding assets with only VII, at amortized cost)	3.85		%	3.69		%	16 bps		3.83		%	3.95		%	(12) bps



Missouri						43-1627032
(State or other jurisdiction						(IRS employer
of incorporation or organization)						identification number)


Item		Page

	PART I – FINANCIAL INFORMATION

1	Financial Statements
	Condensed Consolidated Balance Sheets (Unaudited) September 30, 2021 and December 31, 2020	3
	Condensed Consolidated Statements of Income (Unaudited) three and nine months September 30, 2021 and 2020	4
	Condensed Consolidated Statements of Comprehensive Income (Unaudited) three and nine months ended September 30, 2021 and 2020	5
	Condensed Consolidated Statements of Stockholders’ Equity (Unaudited) three and nine months ended September 30, 2021 and 2020	6
	Condensed Consolidated Statements of Cash Flows (Unaudited) nine months ended September 30, 2021 and 2020	7
	Notes to Condensed Consolidated Financial Statements (Unaudited):	8
	1. Business and Basis of Presentation	8
	2. Earnings Per Share	8
	3. Equity	9
	4. Investments	11
	5. Derivative Instruments	20
	6. Fair Value of Assets and Liabilities	26
	7. Segment Information	32
	8. Commitments, Contingencies and Guarantees	34
	9. Income Tax	35
	10. Employee Benefit Plans	36
	11. Reinsurance Ceded Receivables and Other	36
	12. Policy Claims and Benefits	37
	13. Financing Activities	37
	14. New Accounting Standards	37
2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	39
3	Quantitative and Qualitative Disclosures About Market Risk	68
4	Controls and Procedures	69

	PART II – OTHER INFORMATION

1	Legal Proceedings	70
1A	Risk Factors	70
2	Unregistered Sales of Equity Securities and Use of Proceeds	70
6	Exhibits	70
	Index to Exhibits	71
	Signatures	72



Item		Page

	PART I – FINANCIAL INFORMATION

1	Financial Statements
	Condensed Consolidated Balance Sheets (Unaudited) September 30, 2020 and December 31, 2019	3
	Condensed Consolidated Statements of Income (Unaudited) Three and nine months ended September 30, 2020 and 2019	4
	Condensed Consolidated Statements of Comprehensive Income (Unaudited) Three and nine months ended September 30, 2020 and 2019	5
	Condensed Consolidated Statements of Stockholders’ Equity (Unaudited) Three and nine months ended September 30, 2020 and 2019	6
	Condensed Consolidated Statements of Cash Flows (Unaudited) Nine months ended September 30, 2020 and 2019	7
	Notes to Condensed Consolidated Financial Statements (Unaudited):	8
	1. Business and Basis of Presentation	8
	2. Earnings Per Share	10
	3. Equity	10
	4. Investments	13
	5. Derivative Instruments	22
	6. Fair Value of Assets and Liabilities	28
	7. Segment Information	36
	8. Commitments, Contingencies and Guarantees	38
	9. Income Tax	40
	10. Employee Benefit Plans	40
	11. Reinsurance	41
	12. Policy Claims and Benefits	41
	13. Financing Activities	42
	14. New Accounting Standards	42
2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	45
3	Quantitative and Qualitative Disclosures About Market Risk	59
4	Controls and Procedures	59

	PART II – OTHER INFORMATION

1	Legal Proceedings	60
1A	Risk Factors	61
2	Unregistered Sales of Equity Securities and Use of Proceeds	64
6	Exhibits	64
	Index to Exhibits	65
	Signatures	66


	September 30, 2020			December 31, 2019				September 30, 2021		December 31, 2020
	(Dollars in millions, except share data)							(Dollars in millions, except share data)
Assets							Assets
Fixed maturity securities available-for-sale, at fair value (amortized cost $48,661 and $46,753; allowance for credit losses of $19 at September 30, 2020)	$	54,652		$	51,121
Fixed maturity securities available-for-sale, at fair value (amortized cost of $54,347 and $49,548; allowance for credit losses of $17 and $20)							Fixed maturity securities available-for-sale, at fair value (amortized cost of $54,347 and $49,548; allowance for credit losses of $17 and $20)	$	59,289	$	56,735
Equity securities, at fair value	135			320			Equity securities, at fair value	160		132
Mortgage loans on real estate (net of allowances for credit losses of $64 and $12)	5,907			5,706
Mortgage loans on real estate (net of allowance for credit losses of $39 and $64)							Mortgage loans on real estate (net of allowance for credit losses of $39 and $64)	6,366		5,787
Policy loans	1,259			1,319			Policy loans	1,234		1,258
Funds withheld at interest	5,403			5,662			Funds withheld at interest	7,034		5,432
Short-term investments	154			64			Short-term investments	82		227
Other invested assets	2,645			2,363			Other invested assets	3,404		2,829
Total investments	70,155			66,555			Total investments	77,569		72,400
Cash and cash equivalents	3,256			1,449			Cash and cash equivalents	3,027		3,408
Accrued investment income	547			493			Accrued investment income	574		511
Premiums receivable and other reinsurance balances	2,792			2,940			Premiums receivable and other reinsurance balances	3,013		2,842
Reinsurance ceded receivables	950			904
Reinsurance ceded receivables and other							Reinsurance ceded receivables and other	2,585		983
Deferred policy acquisition costs	3,534			3,512			Deferred policy acquisition costs	3,687		3,616
Other assets	893			878			Other assets	994		896
Total assets	$	82,127		$	76,731		Total assets	$	91,449	$	84,656
Liabilities and Stockholders’ Equity							Liabilities and Stockholders’ Equity
Future policy benefits	$	30,331		$	28,672		Future policy benefits	$	35,666	$	31,453
Interest-sensitive contract liabilities	23,208			22,711			Interest-sensitive contract liabilities	26,017		23,276
Other policy claims and benefits	6,242			5,711			Other policy claims and benefits	7,117		6,413
Other reinsurance balances	524			557			Other reinsurance balances	543		598
Deferred income taxes	3,016			2,712			Deferred income taxes	2,407		3,263
Other liabilities	1,611			1,188			Other liabilities	3,327		1,340

Long-term debt	3,573			2,981			Long-term debt	3,173		3,573
Collateral finance and securitization notes	408			598			Collateral finance and securitization notes	314		388
Total liabilities	68,913			65,130			Total liabilities	78,564		70,304
Commitments and contingent liabilities (See Note 8)							Commitments and contingent liabilities (See Note 8)	0		0
Stockholders’ Equity:							Stockholders’ Equity:
Preferred stock – par value $.01 per share, 10,000,000 shares authorized, no shares issued or outstanding	0			0
Common stock – par value $.01 per share, 140,000,000 shares authorized, 85,310,598 shares issued at September 30, 2020 and 79,137,758 shares issued at December 31, 2019	1			1
Preferred stock – par value $0.01 per share, 10,000,000 shares authorized, no shares issued or outstanding							Preferred stock – par value $0.01 per share, 10,000,000 shares authorized, no shares issued or outstanding	—		—
Common stock – par value $0.01 per share, 140,000,000 shares authorized, 85,310,598 shares issued at September 30, 2021 and December 31, 2020							Common stock – par value $0.01 per share, 140,000,000 shares authorized, 85,310,598 shares issued at September 30, 2021 and December 31, 2020	1		1
Additional paid-in capital	2,421			1,937			Additional paid-in capital	2,447		2,406
Retained earnings	8,066			7,952			Retained earnings	8,458		8,148
Treasury stock, at cost – 17,373,572 and 16,481,656 shares	(1,563		)	(1,426		)
Treasury stock, at cost – 17,710,775 and 17,353,697 shares							Treasury stock, at cost – 17,710,775 and 17,353,697 shares	(1,604)		(1,562)
Accumulated other comprehensive income	4,289			3,137			Accumulated other comprehensive income	3,583		5,359
Total stockholders’ equity	13,214			11,601			Total stockholders’ equity	12,885		14,352
Total liabilities and stockholders’ equity	$	82,127		$	76,731		Total liabilities and stockholders’ equity	$	91,449	$	84,656


	Three months ended September 30, 2021 and 2020
	Common Stock		Additional Paid In Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Income		Total
Balance, June 30, 2021	$	1	$	2,430	$	8,531	$	(1,559)	$	4,041	$	13,444

Net income (loss)					(22)						(22)
Total other comprehensive income (loss)									(458)		(458)
Dividends to stockholders, $0.73 per share					(50)						(50)

Purchase of treasury stock							(46)				(46)
Reissuance of treasury stock			17		(1)		1				17
Balance, September 30, 2021	$	1	$	2,447	$	8,458	$	(1,604)	$	3,583	$	12,885


	Three months ended September 30, 2020 and 2019
	Common Stock		Additional Paid In Capital		Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Income		Total
Balance, June 30, 2020	$	1	$	2,413	$	7,901		$	(1,563	)	$	3,801	$	12,553		Balance, June 30, 2020	$	1	$	2,413	$	7,901	$	(1,563)	$	3,801	$	12,553

Net income					213								213			Net income					213						213
Total other comprehensive income (loss)											488		488			Total other comprehensive income (loss)									488		488
Dividends to stockholders, $0.70 per share					(47		)						(47		)	Dividends to stockholders, $0.70 per share					(47)						(47)

Purchase of treasury stock								0					0			Purchase of treasury stock							—				—
Reissuance of treasury stock			8		(1		)	0					7			Reissuance of treasury stock			8		(1)		0				7
Balance, September 30, 2020	$	1	$	2,421	$	8,066		$	(1,563	)	$	4,289	$	13,214		Balance, September 30, 2020	$	1	$	2,421	$	8,066	$	(1,563)	$	4,289	$	13,214


	Nine months ended September 30, 2021 and 2020
	Common Stock		Additional Paid In Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Income		Total
Balance, December 31, 2020	$	1	$	2,406	$	8,148	$	(1,562)	$	5,359	$	14,352
Adoption of new accounting standards					—						—
Net income					461						461
Total other comprehensive income (loss)									(1,776)		(1,776)
Dividends to stockholders, $2.13 per share					(145)						(145)
Issuance of common stock, net of expenses			0								—
Purchase of treasury stock							(48)				(48)
Reissuance of treasury stock			41		(6)		6				41
Balance, September 30, 2021	$	1	$	2,447	$	8,458	$	(1,604)	$	3,583	$	12,885


Balance, June 30, 2019	$	1	$	1,920	$	7,550		$	(1,404	)	$	2,642	$	10,709
Balance, December 31, 2019																Balance, December 31, 2019	$	1	$	1,937	$	7,952	$	(1,426)	$	3,137	$	11,601
Adoption of new accounting standards																Adoption of new accounting standards					(12)						(12)
Net income					263								263			Net income					283						283
Total other comprehensive income (loss)											616		616			Total other comprehensive income (loss)									1,152		1,152
Dividends to stockholders, $0.70 per share					(44		)						(44		)
Dividends to stockholders, $2.10 per share																Dividends to stockholders, $2.10 per share					(134)						(134)
Issuance of common stock, net of expenses																Issuance of common stock, net of expenses			481								481
Purchase of treasury stock								(30		)			(30		)	Purchase of treasury stock							(162)				(162)
Reissuance of treasury stock			8		(3		)	5					10			Reissuance of treasury stock			3		(23)		25				5
Balance, September 30, 2019	$	1	$	1,928	$	7,766		$	(1,429	)	$	3,258	$	11,524
Balance, September 30, 2020																Balance, September 30, 2020	$	1	$	2,421	$	8,066	$	(1,563)	$	4,289	$	13,214



	Nine months ended September 30, 2020 and 2019
	Common Stock		Additional Paid In Capital		Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Income		Total
Balance, December 31, 2019	$	1	$	1,937	$	7,952		$	(1,426	)	$	3,137	$	11,601
Adoption of new accounting standards					(12		)						(12		)
Net income					283								283
Total other comprehensive income (loss)											1,152		1,152
Dividends to stockholders, $2.10 per share					(134		)						(134		)
Issuance of common stock, net of expenses			481										481
Purchase of treasury stock								(162		)			(162		)
Reissuance of treasury stock			3		(23		)	25					5
Balance, September 30, 2020	$	1	$	2,421	$	8,066		$	(1,563	)	$	4,289	$	13,214



Balance, December 31, 2018	$	1	$	1,899	$	7,285		$	(1,371	)	$	636	$	8,450
Adoption of new accounting standards													0
Net income					635								635
Total other comprehensive income (loss)											2,622		2,622
Dividends to stockholders, $1.90 per share					(119		)						(119		)
Purchase of treasury stock								(98		)			(98		)
Reissuance of treasury stock			29		(35		)	40					34
Balance, September 30, 2019	$	1	$	1,928	$	7,766		$	(1,429	)	$	3,258	$	11,524


	Issued	Held In Treasury	Outstanding
Balance, December 31, 2020	85,310,598	17,353,697	67,956,901

Issuance of common stock	—	—	—
Common stock acquired	—	405,644	(405,644)
Stock-based compensation (1)	—	(48,566)	48,566
Balance, September 30, 2021	85,310,598	17,710,775	67,599,823


~~(1)~~	~~Represents net shares issued from treasury pursuant to the Company’s equity-based compensation programs.~~


	Accumulated Currency Translation Adjustments		Unrealized Appreciation (Depreciation) of Investments(1)		Pension and Postretirement Benefits		Total
Balance, December 31, 2020	$	(69)	$	5,500	$	(72)	$	5,359
Other comprehensive income (loss) before reclassifications	33		(2,136)		(5)		(2,108)
Amounts reclassified to (from) AOCI	—		(181)		6		(175)
Deferred income tax benefit (expense)	(14)		521		—		507

Balance, September 30, 2021	$	(50)	$	3,704	$	(71)	$	3,583


~~(1)~~	Includes cash flow hedges of $(57) and $(26) as of September 30, 2020 and December 31, 2019, respectively, and $(47) and $9 as of September 30, 2019 and December 31, 2018, respectively. See Note 5 – “Derivative Instruments” for additional information on cash flow hedges.


	Amount Reclassified from AOCI
	Three months ended September 30,				Nine months ended September 30,
Details about AOCI Components	2021		2020		2021		2020		Affected Line Item in Statements of Income
Net unrealized investment gains (losses):
Net unrealized gains (losses) on available-for-sale securities	$	35	$	8	$	218	$	(20)	Investment related gains (losses), net
Cash flow hedges – Interest rate	(2)		(1)		(6)		(3)		(1)
Cash flow hedges – Currency/Interest rate	—		—		—		—		(1)

Deferred policy acquisition costs attributed to unrealized gains and losses	(8)		6		(31)		35		(2)
Total	25		13		181		12
Provision for income taxes	(5)		(3)		(38)		(5)
Net unrealized gains (losses), net of tax	$	20	$	10	$	143	$	7
Amortization of defined benefit plan items:
Prior service cost (credit)	$	—	$	—	$	1	$	1	(3)
Actuarial gains (losses)	(3)		(1)		(7)		(4)		(3)
Total	(3)		(1)		(6)		(3)
Provision for income taxes	—		1		1		1
Amortization of defined benefit plans, net of tax	$	(3)	$	—	$	(5)	$	(2)

Total reclassifications for the period	$	17	$	10	$	138	$	5


1.	~~Business and Basis of Presentation~~


2.	~~Earnings Per Share~~


3.	~~Equity~~


4.	~~Investments~~


~~(1)~~	~~See Note 5 – “Derivative Instruments” for additional information on cash flow hedges.~~


~~(2)~~	~~This AOCI component is included in the computation of the deferred policy acquisition cost. See Note 8 – “Deferred Policy Acquisition Costs” of the 2019 Annual Report for additional details.~~


~~(3)~~	~~This AOCI component is included in the computation of the net periodic benefit cost. See Note 10 – “Employee Benefit Plans” for additional details.~~


September 30, 2021:	Amortized Cost		Allowance for Credit Losses		Unrealized Gains		Unrealized Losses		Estimated Fair Value		% of Total
Available-for-sale:
Corporate	$	34,331	$	12	$	3,196	$	186	$	37,329	62.9	%
Canadian government	3,280		—		1,447		3		4,724		8.0
RMBS	1,165		—		50		6		1,209		2.0
ABS	3,763		—		39		23		3,779		6.4
CMBS	1,795		1		89		6		1,877		3.2
U.S. government	1,450		—		31		21		1,460		2.5
State and political subdivisions	1,197		—		139		5		1,331		2.2
Other foreign government	7,366		4		294		76		7,580		12.8
Total fixed maturity securities	$	54,347	$	17	$	5,285	$	326	$	59,289	100.0	%



September 30, 2020:	Amortized Cost		Allowance for Credit Losses		Unrealized Gains		Unrealized Losses		Estimated Fair Value		% of Total		Impairments in AOCI
Available-for-sale:
Corporate	$	31,044	$	19	$	3,455	$	221	$	34,259	62.7	%	$	0
Canadian government	2,985		0		1,912		0		4,897		9.0		0
RMBS	1,927		0		101		1		2,027		3.7		0
ABS	2,966		0		28		72		2,922		5.3		0
CMBS	1,871		0		81		22		1,930		3.5		0
U.S. government	1,392		0		238		0		1,630		3.0		0
State and political subdivisions	1,233		0		154		4		1,383		2.5		0
Other foreign government	5,243		0		411		50		5,604		10.3		0
Total fixed maturity securities	$	48,661	$	19	$	6,380	$	370	$	54,652	100.0	%	$	0



December 31, 2019:	Amortized Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value		% of Total		Impairments in AOCI
Available-for-sale:
Corporate	$	29,205	$	2,269	$	81	$	31,393	61.4	%	$	0
Canadian government	3,016		1,596		0		4,612		9.0		0
RMBS	2,339		62		3		2,398		4.7		0
ABS	2,973		19		14		2,978		5.8		0
CMBS	1,841		61		3		1,899		3.7		0
U.S. government	2,096		57		1		2,152		4.2		0
State and political subdivisions	1,074		93		3		1,164		2.3		0
Other foreign government	4,209		321		5		4,525		8.9		0
Total fixed maturity securities	$	46,753	$	4,478	$	110	$	51,121	100.0	%	$	0


December 31, 2020:	Amortized Cost		Allowance for Credit Losses		Unrealized Gains		Unrealized Losses		Estimated Fair Value		% of Total
Available-for-sale:
Corporate	$	31,963	$	17	$	4,356	$	94	$	36,208	63.9	%
Canadian government	3,145		—		1,995		—		5,140		9.1
RMBS	1,735		—		84		2		1,817		3.2
ABS	3,099		—		35		42		3,092		5.4
CMBS	1,790		3		102		21		1,868		3.3
U.S. government	1,242		—		196		1		1,437		2.5
State and political subdivisions	1,237		—		157		4		1,390		2.4
Other foreign government	5,337		—		479		33		5,783		10.2
Total fixed maturity securities	$	49,548	$	20	$	7,404	$	197	$	56,735	100.0	%



	September 30, 2020				December 31, 2019
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Fixed maturity securities pledged as collateral	$	132	$	143	$	113	$	116
Fixed maturity securities received as collateral	n/a		1,421		n/a		727
Assets in trust held to satisfy collateral requirements	27,702		30,432		27,290		29,239



September 30, 2020:			Estimated
	Amortized Cost		Fair Value		% of Total
Finance	$	11,550	$	12,658	37.0	%
Industrial	15,709		17,280		50.4
Utility	3,785		4,321		12.6
Total	$	31,044	$	34,259	100.0	%

December 31, 2019:			Estimated
	Amortized Cost		Fair Value		% of Total
Finance	$	10,896	$	11,653	37.2	%
Industrial	14,692		15,803		50.3
Utility	3,617		3,937		12.5
Total	$	29,205	$	31,393	100.0	%


	Nine months ended September 30, 2021
	Corporate		CMBS		Other Foreign Government		Total
Balance, beginning of period	$	17	$	3	$	—	$	20
Credit losses recognized on securities for which credit losses were not previously recorded	5		1		4		10

Reductions for securities sold during the period	(8)		(2)		—		(10)
Additional increases or decreases for credit losses on securities that had an allowance recorded in a previous period	(2)		(1)		—		(3)

Balance, end of period	$	12	$	1	$	4	$	17


	Nine months ended September 30, 2020
	Corporate		CMBS		Other Foreign Government		Total
Balance, beginning of period	$	—	$	—	$	—	$	—
Credit losses recognized on securities for which credit losses were not previously recorded	38		—		2		40
Reductions for securities sold during the period	(19)		—		(2)		(21)
Balance, end of period	$	19	$	—	$	—	$	19



	September 30, 2020				December 31, 2019
	Gross Unrealized Losses		% of Total		Gross Unrealized Losses		% of Total
Less than 20%	$	276	74.6	%	$	76	69.1	%
20% or more for less than six months	34		9.2		20		18.2
20% or more for six months or greater	60		16.2		14		12.7
Total	$	370	100.0	%	$	110	100.0	%


	Less than 12 months				12 months or greater				Total
			Gross				Gross				Gross
September 30, 2021:	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
Investment grade securities:
Corporate	$	3,789	$	107	$	348	$	18	$	4,137	$	125
Canadian government	45		3		—		—		45		3
RMBS	143		3		86		3		229		6
ABS	935		6		668		5		1,603		11
CMBS	75		1		20		1		95		2
U.S. government	724		21		—		—		724		21
State and political subdivisions	110		2		36		3		146		5
Other foreign government	2,046		41		561		24		2,607		65
Total investment grade securities	7,867		184		1,719		54		9,586		238
Below investment grade securities:
Corporate	506		30		106		31		612		61


ABS	—		—		14		12		14		12
CMBS	—		—		33		4		33		4

Other foreign government	135		7		35		4		170		11
Total below investment grade securities	641		37		188		51		829		88
Total fixed maturity securities	$	8,508	$	221	$	1,907	$	105	$	10,415	$	326


	September 30, 2021
	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 Days		30 – 90 Days		Greater than 90 Days		Total
Securities lending transactions:
Corporate	$	—	$	—	$	—	$	100	$	100
State and political subdivisions	—		—		—		3		3
Total	—		—		—		103		103
Repurchase/reverse repurchase transactions:
Corporate	—		—		117		270		387





Other foreign government	—		—		195		94		289


Total	—		—		312		364		676
Total transactions	$	—	$	—	$	312	$	467	$	779

Gross amount of recognized liabilities for securities lending and repurchase/reverse repurchase transactions in preceding table									$	752
Amounts related to agreements not included in offsetting disclosure									$	27



	September 30, 2020					December 31, 2019
Property type:	Carrying Value			% of Total		Carrying Value			% of Total
Office	$	1,736		29.0	%	$	1,771		31.0	%
Retail	1,700			28.4		1,686			29.4
Industrial	1,235			20.7		1,169			20.4
Apartment	870			14.5		766			13.4
Other commercial	440			7.4		335			5.8
Recorded investment	5,981			100.0	%	5,727			100.0	%
Unamortized balance of loan origination fees and expenses	(10		)			(9		)
Valuation allowances	(64		)			(12		)
Total mortgage loans on real estate	$	5,907				$	5,706



	Recorded Investment
	Debt Service Ratios						Construction Loans
	>1.20x		1.00x - 1.20x		<1.00x		Construction Loans		Total		% of Total
September 30, 2020:
Loan-to-Value Ratio
0% - 59.99%	$	2,884	$	137	$	19	$	4	$	3,044	50.9	%
60% - 69.99%	1,965		48		30		0		2,043		34.2
70% - 79.99%	581		67		27		0		675		11.3
80% or greater	180		22		17		0		219		3.6
Total	$	5,610	$	274	$	93	$	4	$	5,981	100.0	%



	Recorded Investment
	Debt Service Ratios						Construction Loans
	>1.20x		1.00x - 1.20x		<1.00x		Construction Loans		Total		% of Total
December 31, 2019:
Loan-to-Value Ratio
0% - 59.99%	$	3,025	$	52	$	7	$	0	$	3,084	53.8	%
60% - 69.99%	1,841		53		11		0		1,905		33.3
70% - 79.99%	492		13		39		0		544		9.5
80% or greater	96		61		37		0		194		3.4
Total	$	5,454	$	179	$	94	$	0	$	5,727	100.0	%


	Recorded Investment
	Year of Origination
	2021		2020		2019		2018		2017		Prior		Total
September 30, 2021:
Internal credit quality grade:
High investment grade	$	616	$	404	$	584	$	436	$	299	$	1,585	$	3,924
Investment grade	320		298		399		351		374		580		2,322
Average	6		—		27		39		5		53		130
Watch list	—		—		—		—		—		4		4
In or near default	—		—		—		—		—		36		36
Total	$	942	$	702	$	1,010	$	826	$	678	$	2,258	$	6,416


	September 30, 2021		December 31, 2020
Current	$	6,402	$	5,846
31 – 60 days past due	14		15



Total	$	6,416	$	5,861



	September 30, 2020		December 31, 2019
31-60 days past due	$	0	$	0
61-90 days past due	0		0
Greater than 90 days	20		0
Total past due	20		0
Current	5,961		5,727
Total	$	5,981	$	5,727