UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~March 31,~~June 30, 2007


o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 1-11848

REINSURANCE GROUP OF AMERICA, INCORPORATED

(Exact name of Registrant as specified in its charter)


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

1370 Timberlake Manor Parkway
Chesterfield, Missouri 63017
(Address of principal executive offices)

(636) 736-7000
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.

Large accelerated filer þ Accelerated filer o Non-accelerated filer o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

Common stock outstanding ($.01 par value) as of ~~April 30,~~July 31, 2007: ~~61,885,563~~61,993,139 shares.

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)


	March 31,			December 31,			June 30,			December 31,
	2007			2006			2007			2006
	(Dollars in thousands)						(Dollars in thousands)
Assets
Fixed maturity securities:
Available-for-sale at fair value (amortized cost of $8,234,363 and $7,867,932 at March 31, 2007 and December 31, 2006, respectively)	$	8,739,506		$	8,372,173
Available-for-sale at fair value (amortized cost of $8,419,503 and $7,867,932 at June 30, 2007 and December 31, 2006, respectively)							$	8,716,124		$	8,372,173
Mortgage loans on real estate		751,424			735,618			802,168			735,618
Policy loans		1,015,347			1,015,394			1,018,215			1,015,394
Funds withheld at interest		4,262,835			4,129,078			4,498,524			4,129,078
Short-term investments		198,644			140,281			178,668			140,281
Other invested assets		240,868			220,356			283,226			220,356

Total investments		15,208,624			14,612,900			15,496,925			14,612,900
Cash and cash equivalents		315,222			160,428			414,888			160,428
Accrued investment income		91,872			68,292			95,330			68,292
Premiums receivable and other reinsurance balances		656,582			695,307			668,216			695,307
Reinsurance ceded receivables		580,227			563,570			599,767			563,570
Deferred policy acquisition costs		2,845,457			2,808,053			2,945,325			2,808,053
Other assets		127,911			128,287			113,984			128,287

Total assets	$	19,825,895		$	19,036,837		$	20,334,435		$	19,036,837


Liabilities and Stockholders’ Equity
Future policy benefits	$	5,459,663		$	5,315,428		$	5,784,128		$	5,315,428
Interest sensitive contract liabilities		6,302,934			6,212,278			6,427,896			6,212,278
Other policy claims and benefits		1,821,888			1,826,831			1,909,720			1,826,831
Other reinsurance balances		216,071			145,926			174,018			145,926
Deferred income taxes		684,340			828,848			667,245			828,848
Other liabilities		468,936			177,490			529,025			177,490
Short-term debt		29,517			29,384			30,132			29,384
Long-term debt		944,147			676,165			908,658			676,165
Collateral finance facility		850,402			850,402			850,265			850,402
Company-obligated mandatorily redeemable preferred securities of subsidiary trust holding solely junior subordinated debentures of the Company		158,740			158,701			158,779			158,701

Total liabilities		16,936,638			16,221,453			17,439,866			16,221,453

Commitments and contingent liabilities (See Note 5)

Stockholders’ Equity:
Preferred stock (par value $.01 per share; 10,000,000 shares authorized; no shares issued or outstanding)		—			—			—			—
Common stock (par value $.01 per share; 140,000,000 shares authorized; 63,128,273 shares issued at March 31, 2007 and December 31, 2006)		631			631
Common stock (par value $.01 per share; 140,000,000 shares authorized; 63,128,273 shares issued at June 30, 2007 and December 31, 2006)								631			631
Warrants		66,915			66,915			66,915			66,915
Additional paid-in-capital		1,087,730			1,081,433			1,090,648			1,081,433
Retained earnings		1,343,795			1,307,743			1,412,105			1,307,743
Accumulated other comprehensive income:
Accumulated currency translation adjustment, net of income taxes		123,124			109,067			181,956			109,067
Unrealized appreciation of securities, net of income taxes		340,224			335,581			204,108			335,581
Pension and postretirement benefits, net of income taxes		(11,327	)		(11,297	)		(11,610	)		(11,297	)

Total stockholders’ equity before treasury stock		2,951,092			2,890,073			2,944,753			2,890,073
Less treasury shares held of 1,403,514 and 1,717,722 at cost at March 31, 2007 and December 31, 2006, respectively		(61,835	)		(74,689	)
Less treasury shares held of 1,135,134 and 1,717,722 at cost at
June 30, 2007 and December 31, 2006, respectively								(50,184	)		(74,689	)

Total stockholders’ equity		2,889,257			2,815,384			2,894,569			2,815,384

Total liabilities and stockholders’ equity	$	19,825,895		$	19,036,837		$	20,334,435		$	19,036,837

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)


	Three months ended March 31,						Three months ended June 30,						Six months ended June 30,
	2007			2006			2007			2006			2007			2006
	(Dollars in thousands, except per share data)						(Dollars in thousands, except per share data)
Revenues:
Net premiums	$	1,125,450		$	992,442		$	1,207,646		$	1,076,603		$	2,333,096		$	2,069,045
Investment income, net of related expenses		215,743			186,941			274,902			168,605			490,645			355,546
Investment related gains (losses), net		(8,484	)		632
Investment related losses, net								(7,092	)		(5,314	)		(15,576	)		(4,682	)
Change in value of embedded derivatives		2,838			4,552			(7,126	)		(11,075	)		(4,288	)		(6,523	)
Other revenues		19,102			14,530			20,446			13,717			39,548			28,247

Total revenues		1,354,649			1,199,097			1,488,776			1,242,536			2,843,425			2,441,633

Benefits and Expenses:
Claims and other policy benefits		902,810			811,513			980,338			874,531			1,883,148			1,686,044
Interest credited		61,066			61,529			113,652			44,732			174,718			106,261
Policy acquisition costs and other insurance expenses		180,874			151,804			183,561			172,700			364,435			324,504
Change in deferred acquisition costs associated with change in value of embedded derivatives		2,107			2,757			(5,545	)		(7,982	)		(3,438	)		(5,225	)
Other operating expenses		55,422			46,527			56,619			45,830			112,041			92,357
Interest expense		20,453			16,767			23,232			15,014			43,685			31,781
Collateral finance facility expense		12,687			—			13,206			277			25,893			277

Total benefits and expenses		1,235,419			1,090,897			1,365,063			1,145,102			2,600,482			2,235,999
Income from continuing operations before income taxes		119,230			108,200			123,713			97,434			242,943			205,634
Provision for income taxes		42,293			37,620			44,676			33,645			86,969			71,265

Income from continuing operations		76,937			70,580			79,037			63,789			155,974			134,369
Discontinued operations:
Loss from discontinued accident and health operations, net of income taxes		(685	)		(1,510	)		(1,562	)		(158	)		(2,247	)		(1,668	)

Net income	$	76,252		$	69,070		$	77,475		$	63,631		$	153,727		$	132,701


Basic earnings per share:
Income from continuing operations	$	1.25		$	1.15		$	1.28		$	1.04		$	2.53		$	2.20
Discontinued operations		(0.01	)		(0.02	)		(0.03	)		—			(0.04	)		(0.03	)

Net income	$	1.24		$	1.13		$	1.25		$	1.04		$	2.49		$	2.17


Diluted earnings per share:
Income from continuing operations	$	1.20		$	1.13		$	1.22		$	1.02		$	2.43		$	2.14
Discontinued operations		(0.01	)		(0.03	)		(0.02	)		(0.01	)		(0.04	)		(0.02	)

Net income	$	1.19		$	1.10		$	1.20		$	1.01		$	2.39		$	2.12


Dividends declared per share	$	0.09		$	0.09		$	0.09		$	0.09		$	0.18		$	0.18

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)


	Three months ended						Six months ended
	March 31,						June 30,
	2007			2006			2007			2006
	(Dollars in thousands)						(Dollars in thousands)
Cash Flows from Operating Activities:
Net income	$	76,252		$	69,070		$	153,727		$	132,701
Adjustments to reconcile net income to net cash provided by operating activities:
Change in:
Accrued investment income		(23,467	)		(16,109	)		(26,440	)		(18,680	)
Premiums receivable and other reinsurance balances		38,673			(19,127	)		42,087			(91,410	)
Deferred policy acquisition costs		(30,186	)		(79,007	)		(82,761	)		(152,112	)
Reinsurance ceded balances		(16,657	)		7,421			(36,197	)		(13,392	)
Future policy benefits, other policy claims and benefits, and other reinsurance balances		183,149			137,557			373,895			384,937
Deferred income taxes		37,264			37,173			77,666			26,061
Excess tax benefits from share-based payment arrangement		(1,387	)		—			(2,839	)		—
Other assets and other liabilities, net		17,056			19,157			16,477			58,886
Amortization of net investment discounts and other		(9,551	)		(11,888	)		(29,674	)		(26,624	)
Non-cash equity compensation expense		6,568			—
Investment related losses (gains), net		8,484			(632	)
Investment related losses, net								15,576			4,682
Other, net		1,738			8,435			9,656			2,870

Net cash provided by operating activities		287,936			152,050			511,173			307,919

Cash Flows from Investing Activities:
Sales of fixed maturity securities — available for sale		465,349			505,016			1,132,529			879,617
Maturities of fixed maturity securities — available for sale		37,556			25,200			106,051			133,734
Purchases of fixed maturity securities — available for sale		(795,437	)		(610,412	)		(1,531,894	)		(1,273,922	)
Cash invested in mortgage loans on real estate		(27,023	)		(34,364	)		(91,194	)		(46,189	)
Cash invested in policy loans								(8,750	)		(8,579	)
Cash invested in funds withheld at interest		(23,114	)		(9,103	)		(46,636	)		(29,765	)
Net increase in securitized lending activities		47,548			108,400			90,398			76,508
Principal payments on mortgage loans on real estate		11,147			12,874			24,818			43,575
Principal payments on policy loans		47			13,822			5,929			13,822
Change in short-term investments and other invested assets		(98,434	)		117,960			(124,582	)		(725,033	)

Net cash provided by (used in) investing activities		(382,361	)		129,393
Net cash used in investing activities								(443,331	)		(936,232	)

Cash Flows from Financing Activities:
Dividends to stockholders		(5,530	)		(5,500	)		(11,097	)		(11,007	)
Proceeds from long-term debt issuance		295,311			—			295,311			—
Principal payments on debt								—			(100,000	)
Net repayments under credit agreements		(30,000	)		—			(66,602	)		—
Net proceeds from collateral finance facility								—			837,500
Purchases of treasury stock		(3,611	)		(194	)		(3,611	)		—
Excess tax benefits from share-based payment arrangement		1,387			—			2,839			—
Exercise of stock options, net		4,093			2,871			12,146			2,933
Excess deposits (payments) on universal life and other investment type policies and contracts		(13,201	)		24,429			(45,155	)		49,831

Net cash provided by financing activities		248,449			21,606			183,831			779,257
Effect of exchange rate changes		770			(1,001	)		2,787			(616	)

Change in cash and cash equivalents		154,794			302,048			254,460			150,328
Cash and cash equivalents, beginning of period		160,428			128,692			160,428			128,692

Cash and cash equivalents, end of period	$	315,222		$	430,740		$	414,888		$	279,020


Supplementary information:
Cash paid for interest	$	16,902		$	4,568		$	50,267		$	33,334
Cash paid (received) for income taxes, net of refunds	$	2,107		$	(21,724	)	$	22,440		$	(12,931	)

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Reinsurance Group of America, Incorporated (“RGA”) and its subsidiaries (collectively, the “Company”) have been prepared in conformity with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation have been included. Operating results for the ~~three-month~~six-month period ended ~~March 31,~~June 30, 2007 are not necessarily indicative of the results that may be expected for the year ending December 31, 2007. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2006 Annual Report on Form 10-K (“2006 Annual Report”) filed with the Securities and Exchange Commission on February 26, 2007.

The accompanying unaudited condensed consolidated financial statements include the accounts of Reinsurance Group of America, Incorporated and its subsidiaries. All intercompany accounts and transactions have been eliminated. The Company has reclassified the presentation of certain prior-period information to conform to the 2007 presentation.

2. Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share on income from continuing operations (in thousands, except per share information):


	Three months ended
	March 31, 2007		March 31, 2006		Three months ended				Six months ended
					June 30, 2007		June 30, 2006		June 30, 2007		June 30, 2006
Earnings:
Income from continuing operations (numerator for basic and diluted calculations)	$	76,937	$	70,580	$	79,037	$	63,789	$	155,974	$	134,369
Shares:
Weighted average outstanding shares (denominator for basic calculation)		61,520		61,138		61,898		61,185		61,710		61,162

Equivalent shares from outstanding stock options		2,375		1,479		2,643		1,524		2,509		1,501

Denominator for diluted calculation		63,895		62,617		64,541		62,709		64,219		62,663
Earnings per share:
Basic	$	1.25	$	1.15	$	1.28	$	1.04	$	2.53	$	2.20
Diluted	$	1.20	$	1.13	$	1.22	$	1.02	$	2.43	$	2.14

The Company is currently a party to three arbitrations that involve its discontinued accident and health business, including personal accident business, ~~(which~~which includes London market excess of loss ~~business)~~business, and workers’ compensation carve-out business. The Company is also party to a threatened arbitration related to its life reinsurance business. As of ~~April~~June 30, 2007, the parties involved in these actions have raised claims, or established reserves that may result in claims, in the amount of ~~$22.9~~$23.9 million, which is ~~$22.1~~$23.2 million in excess of the amounts held in reserve by the Company. The Company generally has little information regarding any reserves established by the ceding companies, and must rely on management estimates to establish policy claim liabilities. It is possible that any such reserves could be increased in the future. The Company believes it has substantial defenses upon which to contest these claims, including but not limited to misrepresentation and breach of contract by direct and indirect ceding companies. See Note 20, “Discontinued Operations” in the Company’s consolidated financial statements accompanying the 2006 Annual Report for more information. Additionally, from time to time, the Company is subject to litigation related to employment-related matters in the normal course of its business. The Company cannot predict or determine the ultimate outcome of the pending litigation or arbitrations or provide useful ranges of potential losses. It is the opinion of management, after consultation with counsel, that their outcomes, after consideration of the provisions made in the Company’s condensed consolidated financial statements, would not have a material adverse effect on its consolidated financial position. However, it is possible that an adverse outcome could, from time to time, have a material adverse effect on the Company’s consolidated net income in a particular ~~quarterly~~quarter or ~~annual periods.~~year.

RGA has issued guarantees to third parties on behalf of its subsidiaries’ performance for the payment of amounts due under certain credit facilities, reinsurance treaties and office lease obligations, whereby if a subsidiary fails to meet an obligation, RGA or one of its other subsidiaries will make a payment to fulfill the obligation. In limited circumstances, treaty guarantees are granted to ceding companies in order to provide them additional security, particularly in cases where RGA’s subsidiary is relatively new, unrated, or not of a significant ~~size relative to the ceding company.~~size. Liabilities supported by the treaty guarantees, before consideration for any legally offsetting amounts due from the guaranteed party, totaled ~~$287.6~~$299.8 million and $276.5 million as of ~~March 31,~~June 30, 2007 and December 31, 2006, respectively, and are reflected on the Company’s condensed consolidated balance sheets in future policy benefits. Potential guaranteed amounts of future payments will vary depending on production levels and underwriting results. Guarantees related to trust preferred securities and credit facilities provide additional security to third parties should a subsidiary fail to make principal and/or interest payments when due. As of ~~March 31,~~June 30, 2007, RGA’s exposure related to these guarantees was ~~$187.0~~$171.5 million.

In addition, the Company indemnifies its directors and officers as provided in its charters and by-laws. Since this indemnity generally is not subject to limitation with respect to duration or amount, the Company does not believe that it is possible to determine the maximum potential amount due under this indemnity in the future.

6. Employee Benefit Plans

The components of net periodic benefit costs were as follows(dollars in thousands):

Three months ended March 31,
Pension Benefits Other Benefits
2007 2006 2007 2006
Determination of net periodic benefit cost:

Service cost $ 799 $ 614 $ 206 $ 179
Interest cost 592 477 190 156
Expected rate of return on plan assets (455 ) (347 ) — —
Amortization of prior service cost 95 9 — —
Amortization of prior actuarial loss 113 106 84 66

Net periodic benefit cost $ 1,144 $ 859 $ 480 $ 401


	Three months ended						Six months ended
	June 30, 2007			June 30, 2006			June 30, 2007			June 30, 2006
Net periodic pension benefit cost:
Service cost	$	472		$	423		$	1,271		$	1,037
Interest cost		258			371			850			848
Expected return on plan assets		(483	)		(411	)		(938	)		(758	)
Amortization of prior service cost		79			6			174			15
Amortization of prior actuarial (gain) loss		(44	)		78			69			184

Net periodic pension benefit cost	$	282		$	467		$	1,426		$	1,326


Net periodic other benefits cost:
Service cost	$	(63	)	$	180		$	143		$	359
Interest cost		79			155			269			311
Expected return on plan assets		—			—			—			—
Amortization of prior service cost		12			—			12			—
Amortization of prior actuarial (gain) loss		(2	)		66			82			132

Net periodic other benefits cost	$	26		$	401		$	506		$	802

The Company made no$1.9 million in pension contributions during the ~~first~~second quarter of 2007 and expects this to ~~make second quarter 2007 contributions of approximately $1.9 million.~~be the only contribution for the year.

7. Financing Activities

On March 6, 2007, RGA issued 5.625% Senior Notes due March 15, 2017 with a face amount of $300.0 million. These senior notes have been registered with the Securities and Exchange Commission. The net proceeds from the offering were approximately $295.3 million, a portion of which were used to pay down ~~$30.0~~$50.0 million of indebtedness under a U.S. bank credit ~~facility in March 2007. An additional $20.0 million was used to repay additional indebtedness under a bank credit facility in April 2007.~~facility. The remaining net proceeds are designated for general corporate purposes. Capitalized issue costs were approximately $2.6 million.

8. Equity Based Compensation

Effective January 1, 2006, the Company adopted Statement of Financial Accounting Standard (“SFAS”) No. 123(r), “Share-Based Payment” (“SFAS 123(r)”). SFAS 123(r) requires that the cost of all share-based transactions be recorded in the financial statements. The Company has been recording compensation cost for all equity-based grants or awards after January 1, 2003 consistent with the requirement of SFAS No. 123 “Accounting for Stock-Based Compensation”, as amended by SFAS 148, “Accounting for Stock-Based Compensation — Transition and Disclosure — An Amendment of SFAS No. 123”. Equity compensation expense was ~~$6.6~~$2.9 million and ~~$5.9~~$4.8 million in the second quarter of 2007 and 2006, respectively, and $9.5 million and $10.6 million in the first ~~quarter~~six months of 2007 and 2006, respectively. In the first quarter of 2007, the Company granted 0.3 million incentive stock options at $59.63 weighted average per share and 0.1 million performance contingent units (“PCUs”) to employees. Additionally, non-employee directors were granted a total of 4,800 shares of common stock. As of ~~March 31,~~June 30, 2007, the total compensation cost of

non-vested awards not yet recognized in the financial statements was ~~$22.7~~$18.1 million with various recognition periods over the next five years.

9. New Accounting Standards

Effective January 1, 2007 the Company adopted Financial Accounting Standards Board (“FASB”) Interpretation (“FIN”) No. 48, “Accounting for Uncertainty in Income Taxes — an interpretation of FASB Statement No. 109” (“FIN 48”). FIN 48 clarifies the accounting for uncertainty in income tax recognized in a company’s financial statements. FIN 48 requires companies to determine whether it is “more likely than not” that a tax position will be sustained upon examination by the appropriate taxing authorities before any part of the benefit can be recorded in the financial statements. It also provides guidance on the recognition, measurement and classification of income tax uncertainties, along with any related interest and penalties. Previously recorded income tax benefits that no longer meet this standard are required to be charged to earnings in the period that such determination is made.

As a result of implementation of FIN 48, the Company recognized a $17.3 million increase in the liability for unrecognized tax benefits, a $5.3 million increase in the interest liability for unrecognized tax benefits, and a corresponding reduction to the January 1, 2007 balance of retained earnings of $22.6 million. The Company’s total amount of unrecognized tax benefits upon adoption of FIN 48 was $196.3 million. The Company reclassified, at adoption, $9.1 million of current tax liabilities to the liability for unrecognized tax benefits. The Company also reclassified, at adoption, $169.9 million of deferred income tax liabilities to the liability for unrecognized tax benefits for tax positions for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. Because of the impact of deferred tax accounting, other than interest and penalties, the disallowance of the shorter deductibility period would not affect the annual effective tax rate but would accelerate the payment of cash to the taxing authority to an earlier period. The total amount of unrecognized tax benefits as of January 1, 2007 that would affect the effective tax rate if recognized is $26.4 million. The Company also had $29.8 million of accrued interest, as of January 1, 2007. The Company classifies interest accrued related to unrecognized tax benefits in interest expense, while penalties are included within income tax expense.

The Company files income tax returns in the U.S. federal jurisdiction and various state and non U.S. jurisdictions. With a few exceptions, the Company is no longer subject to U.S. federal, state and local, or non U.S. income tax examinations by tax authorities for years before 2003. There were no significant changes in the liability for unrecognized tax benefits during the ~~three~~six months ended ~~March 31,~~June 30, 2007.

Effective January 1, 2007, the Company adopted the provisions of the FASB’s Emerging Issues Task Force (“EITF”) Issue 06-5. This issue, titled “Accounting for the Purchases of Life Insurance — Determining the Amount That Could Be Realized in Accordance with FASB Technical Bulletin No. 85-4”, clarified that the amount of the DAC receivable beyond one year generally must be discounted to present value under Accounting Principles Board

Opinion 21. The adoption of EITF Issue 06-05 did not have a material impact on the Company’s condensed consolidated financial statements.

Effective January 1, 2007, the Company adopted Statement of Position (“SOP”) 05-1, “Accounting by Insurance Enterprises for Deferred Acquisition Costs in Connection with Modifications or Exchanges of Insurance Contracts” (“SOP 05-1”). SOP 05-1 provides guidance on accounting by insurance enterprises for DAC on internal replacements of insurance and investment contracts other than those specifically described in SFAS No. 97, “Accounting and Reporting by Insurance Enterprises for Certain Long-Duration Contracts and for Realized Gains and Losses from the Sale of Investments”. SOP 05-1 defines an internal replacement as a modification in product benefits, features, rights, or coverages that occurs by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to a contract, or by the election of a feature or coverage within a contract. SOP 05-1 is effective for internal replacements occurring in fiscal years beginning after December 15, 2006. In addition, in February 2007, the American Institute of Certified Public Accountants (“AICPA”) issued related Technical Practice Aids (“TPAs”) to provide further clarification of SOP 05-1. The TPAs are effective concurrently with the adoption of the SOP. The adoption of SOP 05-1 and related ~~TPA’s~~TPAs did not ~~have a material impact on the Company’s condensed consolidated financial statements.~~

for fiscal years beginning after November 15, 2007. The guidance in SFAS 157 will be applied prospectively with the exception of: (i) block discounts of financial instruments; and (ii) certain financial and hybrid instruments measured at initial recognition under SFAS 133, “Accounting for Derivative Instruments and Hedging Activities” (“SFAS 133”) which is to be applied retrospectively as of the beginning of initial adoption (a limited form of retrospective application). The Company is currently evaluating the impact of SFAS 157 and does not expect that the pronouncement will have a material impact on the Company’s condensed consolidated financial statements.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“SFAS 159”). SFAS 159 permits all entities the option to measure most financial instruments and certain other items at fair value at specified election dates and to report related unrealized gains and losses in earnings. The fair value option will generally be applied on an instrument-by-instrument basis and is generally an irrevocable election. SFAS 159 is effective for fiscal years beginning after November 15, 2007. The Company is evaluating which eligible financial instruments, if any, it will elect to account for at fair value under SFAS 159 and the related impact on the Company’s condensed consolidated financial statements.

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

Overview

The Company’s primary business is 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. Each year, however, a portion of the business under existing treaties terminates due to, among other things, lapses or surrenders of underlying policies, deaths of policyholders, and the exercise of recapture options by ceding companies.

The Company derives revenues primarily from renewal premiums from existing reinsurance treaties, new business premiums from existing or new reinsurance treaties, income earned on invested assets, and fees earned from financial reinsurance transactions. The Company believes that industry trends have not changed materially from those discussed in its 2006 Annual Report.

The Company’s profitability primarily depends on the volume and amount of death claims incurred and its 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. The maximum amount of coverage the Company retains per life is $6 million. Claims in excess of this retention amount are retroceded to retrocessionaires; however, the Company remains fully liable to the ceding company for the entire amount of risk it assumes. The Company believes its sources of liquidity are sufficient to cover potential claims payments on both a short-term and long-term basis.

The Company measures performance based on income or loss from continuing operations before income taxes for each of its five segments. The Company’s U.S., Canada, Europe & South Africa and Asia Pacific operations provide traditional life reinsurance to clients. The Company’s U.S. operations also provide asset-intensive and financial reinsurance products. The Company also provides insurers with critical illness reinsurance in its Canada, Europe & South Africa and Asia Pacific operations. Asia Pacific operations also provide financial reinsurance. The Corporate and Other segment results include the corporate investment activity, general corporate expenses, interest expense of RGA, operations of RGA Technology Partners, Inc., a wholly-owned subsidiary that develops and markets technology solutions for the insurance industry, Argentine business in run-off and the provision for income taxes. The Company’s discontinued accident and health operations are not reflected in its results from continuing operations.

The Company allocates capital to its segments based on an internally developed risk capital model, the purpose of which is to measure the risk in the business and to provide a 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 and investment related gains (losses) are credited to the segments based on the level of allocated equity. 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.

Results of Operations

Consolidated income from continuing operations before income taxes increased ~~$11.0~~$26.3 million, or ~~10.2%~~27.0%, and $37.3 million, or 18.1%, for the second quarter and first ~~quarter~~six months of 2007, respectively, primarily due to increased premiums in all segments. Also, contributing to ~~this increase was~~these increases were improved mortality experience in the ~~U.S.,~~ Canada ~~and~~segment partially offset by adverse mortality experience in the Europe and South Africa ~~segments.~~segment. Consolidated net premiums increased ~~$133.0~~$131.0 million, or ~~13.4% for~~12.2%, and $264.1 million, or 12.8%, during the second quarter and first ~~quarter~~six months of 2007, respectively, due to growth in life reinsurance in force. Foreign currency fluctuations favorably affected net premiums by approximately $21.2 million and $34.3 million in the second quarter and first six months of 2007, respectively, as compared to the same periods in 2006.

Consolidated investment income, net of related expenses, increased ~~$28.8~~$106.3 million, or ~~15.4% in~~63.0%, and $135.1 million, or 38.0%, during the second quarter and first ~~quarter~~six months of 2007, respectively, primarily due to market value changes related to the Company’s funds withheld at interest investment in certain equity index annuity products, which are substantially offset by a corresponding increase in interest credited to policyholder account balances resulting in a negligible effect on net income, a larger invested asset ~~base.~~base, and a higher effective yield. Invested

Company recognized a $10.5 million foreign currency translation loss related to its decision to sell its direct insurance operations in Argentina. The Company does not expect the ultimate sale of that subsidiary to generate a material financial impact. Investment income and a portion of investment related gains (losses) are allocated to the segments based upon average assets and related capital levels deemed appropriate to support the segment business volumes.

The effective tax rate on a consolidated basis was ~~35.5%~~36.1% for the ~~first~~second quarter of 2007, compared to ~~34.8%~~34.5% for the prior-year period. The effective ~~rate~~tax rates for the first ~~quarter~~and second quarters of 2007 ~~was~~were affected by the ~~adoption~~application of FIN 48. However, on an ongoing basis, the Company does not anticipate that this will have a material impact on its effective tax rate.

Critical Accounting Policies

The Company’s accounting policies are described in Note 2 in the 2006 Annual Report. The Company believes its most critical accounting policies include the capitalization and amortization of deferred acquisition costs (“DAC”); the establishment of liabilities for future policy benefits, other policy claims and benefits, including incurred but not reported claims; the valuation of investment impairments; and the establishment of arbitration or litigation reserves. The balances of these accounts are significant to the Company’s financial position and require extensive use of assumptions and estimates, particularly related to the future performance of the underlying business.

Additionally, for each of the Company’s reinsurance contracts, it must determine if the contract provides indemnification against loss or liability relating to insurance risk, in accordance with applicable accounting standards. The Company must review all contractual features, particularly those that may limit the amount of insurance risk to which the Company is subject or features that delay the timely reimbursement of claims. If the Company determines that the possibility of a significant loss from insurance risk will occur only under remote circumstances, it records the contract under a deposit method of accounting with the net amount receivable or payable reflected in premiums receivable and other reinsurance balances or other reinsurance liabilities on the condensed consolidated balance sheets. Fees earned on the contracts are reflected as other revenues, as opposed to net premiums, on the condensed consolidated statements of income.

Costs of acquiring new business, which vary with and are primarily related to the production of new business, have been deferred to the extent that such costs are deemed recoverable from future premiums or gross profits. Deferred policy acquisition costs reflect the Company’s expectations about the future experience of the business in force and include commissions and allowances as well as certain costs of policy issuance and underwriting. Some of the factors that can affect the carrying value of DAC include mortality assumptions, interest spreads and policy lapse rates. The Company performs periodic tests to determine that DAC remains recoverable, and the cumulative amortization is re-estimated and, if necessary, adjusted by a cumulative charge or credit to current operations.

Liabilities for future policy benefits under long-term life insurance policies (policy reserves) are computed based upon expected investment yields, mortality and withdrawal (lapse) rates, and other assumptions, including a provision for adverse deviation from expected claim levels. The Company primarily relies on its own valuation and administration systems to establish policy reserves. The policy reserves the Company establishes may differ from those established by the ceding companies due to the use of different mortality and other assumptions. However, the Company relies upon its clients to provide accurate data, including policy-level information, premiums and claims, which is the primary information used to establish reserves. The Company’s administration departments work directly with its clients to help ensure information is submitted by them in accordance with the reinsurance contracts. Additionally, the Company performs periodic audits of the information provided by ceding companies. The Company establishes reserves for processing backlogs with a goal of clearing all backlogs within a ninety-day period. The backlogs are usually due to data errors the Company discovers or computer file compatibility issues, since much of the data reported to the Company is in electronic format and is uploaded to its computer systems.

The Company periodically reviews actual historical experience and relative anticipated experience compared to the assumptions used to establish aggregate policy reserves. Further, the Company establishes premium deficiency reserves if actual and anticipated experience indicates that existing aggregate policy reserves, together with the present value of future gross premiums, are not sufficient to cover the present value of future benefits, settlement and maintenance costs and to recover unamortized acquisition costs. The premium deficiency reserve is established through a charge to income, as well as a reduction to unamortized acquisition costs and, to the extent there are no unamortized acquisition costs, an increase to future policy benefits. Because of the many assumptions and estimates

used in establishing reserves and the long-term nature of the Company’s reinsurance contracts, the reserving process, while based on actuarial science, is inherently uncertain. If the Company’s assumptions, particularly on mortality, are inaccurate, its reserves may be inadequate to pay claims and there could be a material adverse effect on its results of operations and financial condition.

Other policy claims and benefits include claims payable for incurred but not reported losses, which are determined using case-basis estimates and lag studies of past experience. These estimates are periodically reviewed and any adjustments to such estimates, if necessary, are reflected in current operations. The time lag from the date of the claim or death to the date when the ceding company reports the claim to the Company can be several months and can vary significantly by ceding company and business segment. The Company updates its analysis of incurred but not reported claims, including lag studies, on a periodic basis and adjusts its claim liabilities accordingly. The adjustments in a given period are generally not significant relative to the overall policy liabilities.

The Company primarily invests in fixed maturity securities, and monitors these fixed maturity securities to determine potential impairments in value. With the Company’s external investment managers, it evaluates its intent and ability to hold securities, along with factors such as the financial condition of the issuer, payment performance, the extent to which the market value has been below amortized cost, compliance with covenants, general market and industry sector conditions, and various other factors. Securities, based on management’s judgments, with an other-than-temporary impairment in value are written down to management’s estimate of fair value.

Differences in experience compared with the assumptions and estimates utilized in the justification of the recoverability of DAC, in establishing reserves for future policy benefits and claim liabilities, or in the determination of other-than-temporary impairments to investment securities can have a material effect on the Company’s results of operations and financial condition.

The Company is currently a party to various litigation and arbitrations. While it is difficult to predict or determine the ultimate outcome of the pending litigation or arbitrations or even to provide useful ranges of potential losses, it is the opinion of management, after consultation with counsel, that the outcomes of such litigation and arbitrations, after consideration of the provisions made in the Company’s condensed consolidated financial statements, would not have a material adverse effect on its consolidated financial position. However, it is possible that an adverse outcome could, from time to time, have a material adverse effect on the Company’s consolidated net income ~~or cash flows~~ in a particular quarter or year. See Note 20, “Discontinued Operations” of the consolidated financial statements accompanying the 2006 Annual Report for more information.

Further discussion and analysis of the results for 2007 compared to 2006 are presented by segment. References to income before income taxes exclude the effects of discontinued operations.

U.S. OPERATIONS

U.S. operations consist of two major sub-segments: Traditional and Non-Traditional. The Traditional sub-segment primarily specializes in mortality-risk reinsurance. The Non-Traditional sub-segment consists of Asset-Intensive and Financial Reinsurance.

For the three months ended ~~March 31,~~June 30, 2007 (dollars in thousands)



				Non-Traditional					Total			Traditional			Non-Traditional						Total
							Financial		U.S.						Asset-			Financial			U.S.
	Traditional			Asset-Intensive			Reinsurance		Operations						Intensive			Reinsurance			Operations

Revenues:
Net premiums	$	669,419		$	1,626		$	—	$	671,045		$	718,753		$	1,598		$	—		$	720,351
Investment income, net of related expenses		84,928			67,952			20		152,900			87,151			117,319			99			204,569
Investment related losses, net		(338	)		(783	)		—		(1,121	)		(4,497	)		(1,144	)		(7	)		(5,648	)
Change in value of embedded derivatives		—			2,838			—		2,838			—			(7,126	)		—			(7,126	)
Other revenues		106			7,424			5,889		13,419			300			9,690			5,846			15,836

Total revenues		754,115			79,057			5,909		839,081			801,707			120,337			5,938			927,982

Benefits and expenses:
Claims and other policy benefits		542,586			4,523			1		547,110			594,619			(553	)		—			594,066
Interest credited		14,270			46,158			—		60,428			14,579			98,324			—			112,903
Policy acquisition costs and other insurance expenses		99,380			20,186			2,194		121,760			101,807			22,295			2,001			126,103
Change in deferred acquisition costs associated with change in value of embedded derivatives		—			2,107			—		2,107			—			(5,545	)		—			(5,545	)
Other operating expenses		11,868			1,621			1,010		14,499			11,604			1,705			931			14,240

Total benefits and expenses		668,104			74,595			3,205		745,904			722,609			116,226			2,932			841,767

Income before income taxes	$	86,011		$	4,462		$	2,704	$	93,177		$	79,098		$	4,111		$	3,006		$	86,215

For the six months ended June 30, 2007 (dollars in thousands)



	Traditional				Non-Traditional						Total
					Asset-			Financial			U.S.
					Intensive			Reinsurance			Operations

Revenues:
Net premiums	$	1,388,172			$	3,224		$	—		$	1,391,396
Investment income, net of related expenses		172,079				185,271			119			357,469
Investment related losses, net		(4,835	)			(1,927	)		(7	)		(6,769	)
Change in value of embedded derivatives		—				(4,288	)		—			(4,288	)
Other revenues		406				17,114			11,735			29,255

Total revenues		1,555,822				199,394			11,847			1,767,063

Benefits and expenses:
Claims and other policy benefits		1,137,205		��		3,970			1			1,141,176
Interest credited		28,849				144,482			—			173,331
Policy acquisition costs and other insurance expenses		201,187				42,481			4,195			247,863
Change in deferred acquisition costs associated with change in value of embedded derivatives		—				(3,438	)		—			(3,438	)
Other operating expenses		23,472				3,326			1,941			28,739

Total benefits and expenses		1,390,713				190,821			6,137			1,587,671

Income before income taxes	$	165,109			$	8,573		$	5,710		$	179,392

For the six months ended June 30, 2006 (dollars in thousands)



	Traditional			Non-Traditional						Total
				Asset-			Financial			U.S.
				Intensive			Reinsurance			Operations

Revenues:
Net premiums	$	1,274,138		$	3,079		$	—		$	1,277,217
Investment income, net of related expenses		145,699			119,321			(155	)		264,865
Investment related losses, net		(3,735	)		(5,844	)		—			(9,579	)
Change in value of embedded derivatives		—			(6,523	)		—			(6,523	)
Other revenues		(44	)		7,197			14,806			21,959

Total revenues		1,416,058			117,230			14,651			1,547,939

Benefits and expenses:
Claims and other policy benefits		1,053,786			(142	)		1			1,053,645
Interest credited		23,283			81,467			—			104,750
Policy acquisition costs and other insurance expenses		183,401			30,934			4,660			218,995
Change in deferred acquisition costs associated with change in value of embedded derivatives		—			(5,225	)		—			(5,225	)
Other operating expenses		18,858			3,189			2,456			24,503

Total benefits and expenses		1,279,328			110,223			7,117			1,396,668

Income before income taxes	$	136,730		$	7,007		$	7,534		$	151,271

Income before income taxes for the U.S. operations segment totaled ~~$93.2~~$86.2 million and $179.4 million for the second quarter and first ~~quarter~~six months of 2007, respectively, compared to ~~$80.3~~$70.9 million and $151.3 million for the same ~~period~~periods in the prior year. This increase in income ~~for the first three months~~ can be primarily attributed to growth in total business in force and ~~favorable~~improved mortality ~~experience.~~experience over the first half of 2006.

Traditional Reinsurance

The U.S. Traditional sub-segment provides life reinsurance to domestic clients for a variety of life products through yearly renewable term, coinsurance and modified coinsurance agreements. These reinsurance arrangements may be

either facultative or automatic agreements. During the second quarter and first ~~quarter~~six months of 2007, this sub-segment added ~~$40.2~~$44.1 billion and $84.4 billion of new business ~~(life reinsurance~~ in ~~force)~~force, measured by face amount of insurance in force, respectively, compared to ~~$47.9~~$41.7 billion inand $89.6 billion during the same ~~period~~periods in 2006. Management believes industry consolidation and the established practice of reinsuring mortality risks should continue to provide opportunities for growth.

Income before income taxes for U.S. Traditional reinsurance increased ~~23.9% from~~$11.8 million, or 17.5%, and $28.4 million, or 20.8%, in the second quarter and first ~~quarter of 2006. Favorable mortality experience in 2007 was the primary contributor to the overall growth in net income for the first three~~six months of the ~~year. Higher~~2007, respectively. Stronger premiums and higher investment income ~~also contributed~~were the primary contributors to the ~~total~~ increase in net ~~income for~~income. Mortality experience also improved compared to the ~~year.~~comparable six month period.

Net premiums for U.S. Traditional reinsurance totaled ~~$669.4 million~~$718.8 and $1,388.2 for the second quarter and first ~~quarter~~six months of ~~2007 compared to $611.8 million for the first quarter of 2006.~~2007. Comparable prior year numbers were $662.3 and $1,274.1, respectively. The ~~9.4%~~9.0% increase in year to date net premiums was driven primarily by the growth of total U.S. business in force, which totaled just over $1.2 trillion of face amount as of ~~March 31, 2007,~~June 30, 2007. This represents a ~~6.2%~~7.2% increase over the amount in force ~~as of March 31,~~on June 30, 2006.

Investment income and investment related gains and losses are allocated to the various operating segments based on average assets and related capital levels deemed appropriate to support the segment business volumes. Investment performance varies with the composition of investments and the relative allocation of capital to the operating segments. During the ~~first~~second quarter of 2007, investment income in the ~~segment~~sub-segment totaled ~~$84.9~~$87.2 million, a ~~19.5%~~16.7% increase over the same ~~prior-year period.~~period in the prior year. Year to date 2007, investment income grew 18.1% over the first six months of 2006. This increase can be primarily attributed to growth in the invested asset ~~base and an increase in investment income on policy loans.~~base.

Mortality experience for the first ~~quarter~~six months of 2007 improved over the same year prior period while quarter over quarter the experience was ~~favorable.~~relatively consistent. Claims and other policy benefits, as a percentage of net premiums (loss ratios), were ~~81.1%~~82.7% for the second quarter and 81.9% for the first ~~quarter compared to 83.1% in~~six months of 2007. The loss ratios for the ~~first quarter of 2006.~~same prior-year periods were 82.4% and 82.7%, respectively. Death claims are reasonably predictable over a period of many years, but are less predictable over shorter periods and are subject to significant fluctuation.

Interest credited relates to amounts credited on cash value products, which have a significant mortality component. The amount of interest credited fluctuates in step with changes in deposit levels, cash surrender values and investment performance. Income before income taxes is affected by the spread between the investment income and the interest credited on the underlying products. Interest credited expense for the second quarter and first ~~quarter~~six months of 2007 totaled ~~$14.3~~$14.6 million and $28.8 million, respectively, compared to ~~$11.5~~$11.8 million and $23.3 million for the same ~~period~~periods in 2006. The increase is primarily the result of one treaty in which the credited loan rate increased from 4.6% in 2006 to 5.6% in 2007 ~~while~~based on an increase in the ~~loan balance grew by 4.3%.~~related market index. A corresponding increase in investment income offset this ~~increased~~additional expense.

Policy acquisition costs and other insurance expenses, as a percentage of net premiums, were ~~14.8%~~14.2% for the second quarter of 2007 and 14.5% for the first ~~quarter~~six months of 2007. ~~A comparable ratio~~Comparable ratios for the second quarter and first ~~quarter~~six months of 2006 ~~was 13.4%.~~were 15.3% and 14.4%, respectively. Overall, while these ratios are expected to remain in a certain range, they may fluctuate from period to period due to varying allowance levels within coinsurance-type ~~reinsurance agreements.~~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. ~~Additionally,~~Finally, 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, as a percentage of net premiums, were ~~1.8%~~1.6% for the ~~first~~second quarter of 2007 and 1.7% year to date, compared to ~~1.7% reported~~1.3% and 1.5% for the second quarter and year to date, respectively, in 2006. The expense ratio can fluctuate slightly from period to period, however, the size and maturity of the U.S. operations segment indicates it should remain relatively constant over the long term.

In accordance with the provisions of ~~Statement of Financial Accounting Standard (“SFAS”)~~SFAS No. 133 Implementation Issue No. B36, “Embedded Derivatives: Modified Coinsurance Arrangements and Debt Instruments That Incorporate Credit Risk Exposures That Are Unrelated or Only Partially Related to the Creditworthiness of the Obligor under Those Instruments” (“Issue B36”), the Company recorded a change in value of embedded derivatives of ~~$2.8~~$(7.1) million and $(4.3) million within revenues for the ~~first~~second quarter and ~~$2.1~~first six months of 2007, respectively, and $(5.5) million and $(3.4) million of related deferred acquisition costs. Significant fluctuations may occur as the fair value of the embedded derivatives is tied primarily to the movements in credit spreads. These fluctuations have no impact on cash flows or interest spreads on the underlying treaties. Therefore, Company management believes it is helpful to distinguish between the effects of Issue B36 and the primary factors that drive profitability of the underlying treaties, namely investment income, fee income, and interest credited. Additionally, over the expected life of the underlying treaties, management expects the cumulative effect of Issue B36 to be immaterial.

The Asset-Intensive sub-segment reported income before income taxes ~~of $4.5~~equal to $4.1 million for the ~~first~~second quarter of 2007 ~~a $2.8~~and $8.6 million ~~decrease compared~~year to ~~prior year.~~date. Comparable figures for 2006 were $(0.3) million and $7.0 million, respectively. Of the $4.4 million increase quarter over quarter, Issue B36 contributed ~~$1.1 million to this decrease.~~$1.5 million. The remaining ~~$1.7 decrease~~$2.9 million can be ~~primarily~~ attributed to ~~an increase~~both the improved spread between the investment income and the interest credited on the underlying deposit liabilities and a decrease in ~~benefit claims on a single premium universal life reinsurance treaty offset in part by lower~~ investment related losses.

Total revenues increased $2.2 million for the first quarter of 2007. Issue B36 related revenues decreased $1.7 million for the first quarter of 2007, resulting in a revenue increase of $3.9 million excluding Issue B36. One of the primary drivers of this increased revenue is a rise in the mortality and expense charges collected relating to a new variable annuity reinsurance treaty. Mortality and expense charges are included in other revenues. Additionally, investment related losses decreased $2.6 million over same quarter in 2006. In 2006, an increased interest rate environment allowed the Company to sell bonds at lower book yields and reinvest in higher book yielding securities. This strategy ~~results~~resulted in investment losses at the time of sale, but should generate higher future investment income. The year over year increase in income before income taxes of $1.1 million, excluding Issue B36, is primarily the result of smaller investment losses offset in part by higher benefits due to an increase in benefit claims on a single premium universal life reinsurance treaty.

Total revenues increased $80.0 million for the second quarter of 2007 and $82.2 million for the first six months of 2007. Issue B36 related revenues increased $3.9 million for the second quarter of 2007 and $2.2 million for the first six months of the year, resulting in revenue growth of $76.1 and $80.0 million, respectively, excluding Issue B36. The primary driver of this increase in revenue was a $68.9 million increase in investment income quarter over quarter and $66.0 million year over year. The majority of this variation can be attributed to market value changes related to the Company’s funds withheld at interest investment in certain equity index annuity products. This increase in investment income is offset by an increase in interest credited expense, with minimal impact on income before income taxes. Also contributing to the overall growth in revenue are the mortality and expense charges earned on a variable annuity reinsurance treaty open for new business. Mortality and expense charges are included in other revenues. Additionally, as mentioned above, investment related losses decreased quarter over quarter and year over year.

The average invested asset base supporting this sub-segment grew from ~~$4.1~~$4.2 billion in the ~~first~~second quarter of 2006 to ~~$4.6~~$4.7 billion for the ~~first~~second quarter of 2007. The growth in the asset base is primarily driven by new business written on one existing annuity treaty. Invested assets outstanding as of ~~March 31,~~June 30, 2007 were $4.7 billion, of which ~~$3.2~~$3.4 billion were funds withheld at interest. Of the ~~$3.2~~$3.4 billion of total funds withheld ~~at interest~~ balance as of ~~March 31,~~June 30, 2007, ~~90.7%~~91.5% of the balance is associated with one client.

Total benefits and expenses, which are comprised primarily of interest credited and policy acquisition costs, increased ~~$5.0~~$75.6 million ~~for~~from the ~~first~~second quarter of ~~2007.~~2006 and $80.6 million year to date. Issue B36 related expenses ~~decreased $0.7~~contributed $2.4 million and $1.8 million to the second quarter and year to date increases, respectively, resulting in ~~an increase in~~increased expenses of ~~$5.7~~$73.2 million and $78.8 million, respectively, excluding Issue B36. The majority of the change in benefits and expenses relates to interest credited expense, which contributed $66.4 million and $63.0 million quarter over quarter and year over year, respectively. As ~~stated~~mentioned above, a large part of this variance is offset in investment income. Also contributing to the increase in benefits and expenses year over year is an increase in benefit claims on a single premium universal life reinsurance treaty ~~were unfavorable this~~in the first quarter ~~and is the primary driver~~ of ~~this increase in benefits and expenses.~~2007.

Financial Reinsurance

The U.S. Financial Reinsurance sub-segment income consists primarily of net fees earned on financial reinsurance transactions. The majority of the financial reinsurance risks are assumed by the Company and retroceded to other insurance companies or brokered business in which the company does not participate in the assumption of risk. The fees earned from the assumption of the financial reinsurance contracts are reflected in other revenues, and the fees

At ~~March 31,~~June 30, 2007 and 2006, the amount of reinsurance provided, as measured by pre-tax statutory surplus, was $1.1 billion ~~compared to~~and $1.8 billion ~~reported at March 31, 2006.~~respectively. This decrease is a result of the aforementioned change in reporting for Asia Pacific-based treaties. The pre-tax statutory surplus includes all business assumed or brokered by the Company in the U.S. 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.

CANADA OPERATIONS

The Company conducts reinsurance business in Canada through RGA Life Reinsurance Company of Canada (“RGA Canada”), a wholly-owned subsidiary. RGA Canada assists clients with capital management activity and mortality risk management, and is primarily engaged in traditional individual life reinsurance, as well as creditor, ~~reinsurance,~~critical illness, and group life and health ~~reinsurance and non-guaranteed critical illness products.~~

For the three months ended March 31, (dollars in thousands) 2007 2006
Revenues:
Net premiums $ 99,492 $ 94,402
Investment income, net of related expenses 26,432 25,305
Investment related gains (losses), net 2,784 (199 )
Other revenues 86 —

Total revenues 128,794 119,508

Benefits and expenses:

Claims and other policy benefits 91,148 89,079
Interest credited 186 205
Policy acquisition costs and other insurance expenses 18,476 17,820
Other operating expenses 3,950 3,973

Total benefits and expenses 113,760 111,077

Income before income taxes $ 15,034 $ 8,431

Income before income taxes increased by $6.6 million or 78.3% in the first quarter of 2007. The increase in 2007 was primarily the result of more favorable mortality experience in the current period as well as an increase in investment related gains of $3.0 million.

Net premiums increased by $5.1 million, or 5.4% in the first quarter of 2007 from the prior-year quarter. The increase is primarily due to new business from new and existing treaties. In addition, an increase in premium from creditor treaties contributed $6.4 million of the premium increase.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 life insurance.



(dollars in thousands)	For the three months ended				For the six months ended
	June 30, 2007		June 30, 2006		June 30, 2007		June 30, 2006

Revenues:
Net premiums	$	122,580	$	97,120	$	222,072	$	191,522
Investment income, net of related expenses		32,363		25,998		58,795		51,303
Investment related gains, net		1,648		2,345		4,432		2,146
Other revenues		93		767		179		767

Total revenues		156,684		126,230		285,478		245,738

Benefits and expenses:
Claims and other policy benefits		105,667		95,449		196,815		184,528
Interest credited		185		207		371		412
Policy acquisition costs and other insurance expenses		21,343		15,769		39,819		33,589
Other operating expenses		5,287		3,731		9,237		7,704

Total benefits and expenses		132,482		115,156		246,242		226,233

Income before income taxes	$	24,202	$	11,074	$	39,236	$	19,505

Income before income taxes increased by $13.1 million or 118.5%, and $19.7 million or 101.2%, in the second quarter and first six months of 2007, respectively. These increases were primarily the result of higher premium volume, favorable mortality experience in the current periods and an increase of $2.3 million in investment related gains for the first six months.

Net premiums increased by $25.5 million, or 26.2%, and $30.6 million or 16.0% in the second quarter and first six months of 2007, respectively. The increase is primarily due to new business from new and existing treaties. In addition, an increase in premium from creditor treaties contributed $6.9 million and $13.3 million of the premium increase in the second quarter and first six months of 2007, respectively. Creditor and group life and health premiums represented ~~18.2%~~18.0% and ~~12.4%~~13.9% of net premiums in the first ~~quarter~~six months of 2007 and 2006, respectively. ~~These increases were offset by a decrease~~A stronger Canadian dollar resulted in an increase in net premiums of ~~$6.3~~$2.7 million ~~due to administrative adjustments. The decline in the strength of the Canadian dollar resulted in a decrease of net premiums of $1.5~~and $1.1 million in the second

quarter and first ~~quarter~~six months of 2007, respectively, as compared to 2006. Premium levels are significantly influenced by large transactions, mix of business and reporting practices of ceding companies and therefore can fluctuate from period to period.

Net investment income increased ~~$1.1~~$6.4 million or ~~4.5%~~24.5%, and $7.5 million or 14.6% in the second quarter and first ~~quarter~~six months of 2007, ~~compared to the prior-year quarter.~~respectively. Investment income and investment related gains and losses are allocated to the segments based upon average assets and related capital levels deemed appropriate to support business volumes. Investment performance varies with the composition of investments and the relative allocation of capital to the operating segments. The increase in investment income was mainly the result of an increase in the allocated asset base due to growth in the underlying business volume.

~~The loss ratio~~Loss ratios for this segment ~~was 91.6%~~were 86.2% and 88.6% in the second quarter and first ~~quarter~~six months of 2007, respectively, compared to ~~94.4%~~98.3% and 96.3% in ~~2006.~~the comparable prior-year periods. During 2006 and 2005, the Company entered into three significant creditor reinsurance treaties. The loss ratios on this type of business are normally lower than traditional reinsurance, however, allowances are normally higher as a percentage of

premiums. Excluding creditor business, the loss ~~ratio~~ratios for this segment ~~was 100.9%~~were 94.8% and 97.5% in the second quarter and first ~~quarter~~six months of 2007, respectively, compared to ~~101.0%~~106.4% and 103.7% in the comparable prior-year ~~period.~~periods. The lower loss ~~ratio~~ratios in 2007 isare primarily due to favorable mortality experience compared to the prior year. Historically, the loss ratio increased primarily as the result of several large permanent level premium in-force blocks assumed in 1997 and 1998. These blocks are mature blocks of permanent level premium business in which mortality as a percentage of net premiums is expected to be higher than historical ratios. The nature of permanent level premium policies requires the Company to set up actuarial liabilities and invest the amounts received in excess of early-year mortality costs to fund claims in the later years when premiums, by design, continue to be level as compared to expected increasing mortality or claim costs. Claims and other policy benefits, as a percentage of net premiums and investment income ~~was 72.4%~~were 68.2% and 70.1% in the second quarter and first ~~quarter~~six months of 2007, respectively, compared to ~~74.4%~~77.5% and 76.0% in ~~2006.~~the comparable prior-year periods. Death claims are reasonably predictable over a period of many years, but are less predictable over shorter periods and are subject to significant fluctuation.

Policy acquisition costs and other insurance expenses as a percentage of net premiums totaled ~~18.6%~~17.4% and 17.9% in the second quarter and first ~~quarter~~six months of 2007, respectively, compared to ~~18.9%~~16.2% and 17.5% in ~~2006.~~the comparable prior-year periods. Excluding ~~the impact of the~~ creditor business, policy acquisition costs and other insurance expenses as a percentage of net premiums totaled ~~12.9%~~11.0% and 11.9% in the second quarter and first ~~quarter~~six months of 2007, respectively, compared to ~~14.7%~~11.3% and 13.0% in ~~2006.~~the comparable prior-year periods. Overall, while these ratios are expected to remain in a certain range, they may fluctuate from period to period due to varying allowance levels, significantly caused by the mix of first year coinsurance business versus yearly renewable term business. 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.

Other operating expenses increased $1.6 million, or 41.7%, and $1.5 million, or 19.9%, in the second quarter and first six months of 2007, respectively. Other operating expenses as a percentage of net premiums totaled 4.3% and 4.2% in the second quarter and first six months of 2007, respectively, compared to 3.8% and 4.0% in the ~~first quarter of 2007 compared to 4.2% in 2006.~~comparable prior-year periods.

EUROPE & SOUTH AFRICA OPERATIONS

The Europe & South Africa segment has operations in France, India, Italy, Mexico, Poland, Spain, South Africa and the United Kingdom (“UK”). The segment provides life reinsurance for a variety of products through yearly renewable term and coinsurance agreements, and reinsurance of critical illness coverage. Reinsurance agreements may be either facultative or automatic agreements covering primarily individual risks and in some markets, group risks.


For the three months ended March 31, (dollars in thousands)	2007			2006

(dollars in thousands)						For the three months ended						For the six months ended
						June 30, 2007			June 30, 2006			June 30, 2007			June 30, 2006

Revenues:
Net premiums	$	167,796		$	145,151	$	164,796		$	146,073		$	332,592		$	291,224
Investment income, net of related expenses		5,774			3,392		7,103			3,873			12,877			7,265
Investment related gains (losses), net		(224	)		34
Investment related losses, net							(630	)		(181	)		(854	)		(147	)
Other revenues		131			91		(27	)		(178	)		104			(87	)

Total revenues		173,477			148,668		171,242			149,587			344,719			298,255

Benefits and expenses:
Claims and other policy benefits		114,154			105,646		128,828			101,034			242,982			206,680
Interest credited		452			190		564			156			1,016			346
Policy acquisition costs and other insurance expenses		26,060			19,257		17,129			21,821			43,189			41,078
Other operating expenses		11,687			8,778		12,875			9,307			24,562			18,085

Total benefits and expenses		152,353			133,871		159,396			132,318			311,749			266,189
Income before income taxes	$	21,124		$	14,797

Income (loss) before income taxes						$	11,846		$	17,269		$	32,970		$	32,066

the second quarter and for the first ~~quarter~~six months of 2007, several foreign currencies, particularly the British pound and the euro strengthened against the U.S. dollar ~~which resulted in~~and increased net premiums by approximately ~~$9.2 million.~~$10.0 million and $19.2 million for the second quarter and first six months of 2007, respectively, over the prior year. A significant portion of the net premiums were due to reinsurance of critical illness coverage, 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 policies including this coverage totaled ~~$57.0~~$57.9 million ~~for~~and $114.9 million during the second quarter and first ~~quarter~~six months of 2007, respectively, compared to ~~$49.2~~$52.4 million and $101.6 million in the ~~first quarter of 2006.~~comparable prior-year periods. Premium levels are significantly influenced by large transactions and reporting practices of ceding companies and therefore can fluctuate from period to period.

Investment income increased ~~$2.4~~$3.2 million ~~or 70.2%,~~ for the ~~first~~second quarter compared to the same period in 2006 and increased $5.6 million for the six months ended June 30, 2007 compared to the same period in 2006. This increase was

primarily ~~due to growth of the invested assets in the UK of $24.7 million over the prior period. The growth was also~~ due to an increase in allocated investment income. Investment income and investment related gains and losses are allocated to the various operating segments based on average assets and related capital levels deemed appropriate to support the segment business volumes. Investment performance varies with the composition of investments and the relative allocation of capital to the operating segments.

Loss ratios ~~were 68.0% and 72.8%~~increased from 69.2% for the ~~first three months~~second quarter of 2006 to 78.2% for the second quarter of 2007, and from 71.0% for the six months ended June 30, 2006 ~~respectively.~~to 73.1% for the six months ended June 30, 2007. The ~~decrease~~increase in loss ~~ratio from the first three months of 2006 to the first three months of 2007~~ratios is due primarily to favorable claims experience in the UK ~~including the effect of claims reversals by several clients.~~during 2006. Death claims are reasonably predictable over a period of many years, but are less predictable over shorter periods and are subject to significant fluctuation.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were ~~15.5%~~10.4% in the ~~first~~second quarter of 2007 compared to ~~13.3%~~14.9% in the ~~first~~second quarter of 2006, and 13.0% for the six months ended June 30, 2007 compared to 14.1% for the six months ended June 30, 2006. These percentages fluctuate due to timing of client company reporting, variations in the mixture of business being reinsured and the relative maturity of the business. In addition, as the segment grows, renewal premiums, which have lower allowances than first-year premiums, represent a greater percentage of the total net premiums.

Other operating expenses for the quarter increased ~~to 7.0%~~from 6.4% of ~~net~~ premiums in 2006 to 7.8% in 2007, and for the first six months it increased from ~~6.0% in 2006.~~6.2% to 7.4%. This increase was due to higher costs associated with maintaining and supporting the ~~significant~~ increase in business over the past several ~~years and the entrance into new markets.~~years. The Company believes that sustained growth in net premiums should lessen the burden of start-up expenses and expansion costs over time.

ASIA PACIFIC OPERATIONS

The Asia Pacific segment has operations in Australia, Hong Kong, Japan, Malaysia, Singapore, New Zealand, South Korea, Taiwan and mainland China. The principal types of reinsurance for this segment include life, critical illness, disability income, superannuation, and financial reinsurance. Superannuation is the Australian government mandated compulsory retirement savings program. Superannuation funds accumulate retirement funds for employees, and in addition, offer life and disability insurance coverage. Reinsurance agreements may be either facultative or automatic agreements covering primarily individual risks and in some markets, group risks.


For the three months ended March 31, (dollars in thousands)	2007			2006

(dollars in thousands)						For the three months ended						For the six months ended
						June 30, 2007			June 30, 2006			June 30, 2007			June 30, 2006

Revenues:
Net premiums	$	186,838		$	139,213	$	198,971		$	168,852		$	385,809		$	308,065
Investment income, net of related expenses		8,663			6,496		8,610			6,822			17,273			13,318
Investment related gains (losses), net		(71	)		15
Investment related losses, net							(499	)		(92	)		(570	)		(77	)
Other revenues		1,827			1,910		2,583			1,581			4,410			3,491

Total revenues		197,257			147,634		209,665			177,163			406,922			324,797

Benefits and expenses:
Claims and other policy benefits		150,483			110,356		151,664			131,866			302,147			242,222
Policy acquisition costs and other insurance expenses		24,614			22,005		28,173			27,567			52,787			49,572
Other operating expenses		11,828			8,659		14,219			10,005			26,047			18,664

Total benefits and expenses		186,925			141,020		194,056			169,438			380,981			310,458

Income before income taxes	$	10,332		$	6,614	$	15,609		$	7,725		$	25,941		$	14,339

compared to the same period in 2006. Higher mortality experience in Australia ~~New Zealand and Hong Kong~~ caused ~~these three operations combined~~this operation to contribute ~~$4.9~~$7.0 million less to income before income taxes for the ~~first~~second quarter of 2007 than they contributed during the same period of 2006. Foreign currency exchange fluctuations were neutral to income before income taxes for the first ~~quarter~~six months of 2007.

Net premiums grew ~~$47.6~~$30.1 million, or ~~34.2%~~17.8%, induring the current quarter, and $77.7 million, or 25.2%, for the six months ended June 30, 2007, as compared to the same ~~period~~periods in ~~2006 due almost entirely to~~2006. This premium growth was primarily the result of continued increases in the volume of business in ~~Japan,~~ Australia and ~~South Korea.~~Japan. Due to continued growth with two significant clients, premiums in Australia increased by $19.1 million in the second quarter of 2007, and $34.4 million for the six months ended June 30, 2007, as compared to the same periods in 2006. Premiums in Japan increased by $22.9 million in the second quarter of 2007, and $47.0 million for the six months ended June 30, 2007 as compared to the same periods in 2006, primarily due to a single new significant treaty. Premium levels are significantly influenced by large transactions and reporting practices of ceding companies and can fluctuate from period to period.

A portion of the net premiums for the segment in each period presented represents reinsurance of critical illness coverage. This coverage provides a benefit in the event of the diagnosis of a pre-defined critical illness. Reinsurance of critical illness in the Asia Pacific operations is offered primarily in South Korea, Australia and Hong Kong. Net premiums earned from ~~policies including~~ this coverage totaled ~~$26.0~~$24.6 million ~~for~~and $50.6 million during the second quarter and first ~~quarter~~six months of 2007, respectively, compared to ~~$11.7~~$23.2 million ~~for~~and $34.9 million during the ~~comparable prior-year period.~~second quarter and first six months of 2006, respectively.

Foreign currencies in certain significant markets, particularly the Australian dollar, the Korean won and the ~~South Korean won,~~New Zealand dollar, have strengthened against the U.S. dollar induring the first ~~quarter~~six months of ~~2007, as compared to the same period in 2006. However,~~2007; however, the Japanese ~~Yen~~yen has weakened against the U.S. dollar during the same ~~respective~~ period. The overall effect of changes in local Asia Pacific segment currencies was an increase in net premiums of approximately ~~$5.5~~$8.5 million in the ~~first~~second quarter of 2007 and an increase of approximately $14.0 million in net premiums for the six months ended June 30, 2007, as compared to the same ~~period~~periods in 2006.

Net investment income increased ~~$2.2~~$1.8 million in the current quarter compared to the prior-year ~~quarter.~~quarter, and $4.0 million for the six months ended June 30, 2007 compared to the six months ended June 30, 2006. This increase was primarily due to growth in the invested assets in ~~Australia, along with an increase in allocated investment income.~~Australia. Investment income and investment related gains and losses are allocated to the various operating segments based on average assets and related capital levels deemed appropriate to support the segment business volumes. Investment performance varies with the composition of investments and the relative allocation of capital to the operating segments.

Other revenues ~~decreased~~increased by ~~$0.1~~$1.0 million for the ~~first~~second quarter of 2007, as compared to the same period in 2006, and increased by $0.9 million for the six months ended June 30, 2007, as compared to the same period in 2006. The primary source of other revenues in 2007 and 2006 has been fees from financial reinsurance treaties, which increased to ~~$2.1~~$4.8 million during the first ~~quarter~~six months of 2007 from ~~$1.1~~$2.7 million during the first ~~quarter~~six months of 2006. ~~In previous quarters,~~Prior to 2007, a portion of the fee income generated by certain Asia Pacific financial reinsurance treaties was reflected in the U.S. financial reinsurance segment. Beginning ~~with the first quarter of~~in 2007, all of the fee income from the Asia Pacific-based financial reinsurance treaties is included within the Asia Pacific segment with reimbursement to the ~~U.S~~U.S. segment for costs incurred by U.S. personnel. The first ~~quarter~~six months of 2006 included $0.6 million of other revenue generated by the recapture of a modified coinsurance treaty in Hong Kong. Additionally, during the first ~~quarter~~six months of 2007, other revenues were reduced by $0.5 million associated with a funds withheld treaty in Hong Kong.

Loss ratios were ~~80.5%~~76.2% and ~~79.3%~~78.1% for the ~~first~~second quarter of 2007 and 2006, respectively, and 78.3% and 78.6% for the six months ended June 30, 2007 and June 30, 2006, respectively. The decreased loss ratio for the second quarter of 2007 was due to favorable experience in New Zealand’s disability income products as compared to the same period of 2006. Loss ratios will fluctuate due to timing of client company reporting, variations in the mixture of business being reinsured and the relative maturity of the business. Death claims are reasonably predictable over a period of many years, but are less predictable over shorter periods and are subject to significant fluctuation.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were ~~13.2% for~~14.2% during the ~~first~~second quarter of 2007, as compared to ~~15.8%~~16.3% for the ~~first~~second quarter of 2006. Policy acquisition costs and other insurance expenses as a percentage of net premiums were 13.7% during the six months ended June 30, 2007, as compared to 16.1% for the six months ended June 30, 2006. The ratio of policy acquisition costs and other

~~6.2%~~and 6.8% of net premiums for the six months ended June 30, 2007, up from 5.9% and 6.1% in the comparable prior-year ~~period.~~periods. The timing of premium flows and the level of costs associated with the entrance into and development of new markets in the growing Asia Pacific segment may cause other operating expenses as a percentage of net premiums to fluctuate over periods of time.

CORPORATE AND OTHER

Corporate and Other revenues include investment income from invested assets not allocated to support segment operations and undeployed proceeds from the Company’s capital raising efforts, in addition to unallocated investment related gains and losses. Corporate expenses consist of the offset to capital charges allocated to the operating segments within the policy acquisition costs and other insurance expenses line item, unallocated overhead and executive costs, and interest expense related to debt and the $225.0 million of 5.75% Company-obligated mandatorily redeemable trust preferred securities. Additionally, Corporate and Other includes results from RGA Technology Partners, Inc., a wholly-owned subsidiary that develops and markets technology solutions for the insurance industry, the Company’s Argentine privatized pension business, which is currently in run-off, an insignificant amount of direct insurance operations in Argentina and the investment income and expense associated with the Company’s collateral finance facility.


For the three months ended March 31, (dollars in thousands)	2007			2006

(dollars in thousands)							For the three months ended						For the six months ended
							June 30, 2007			June 30, 2006			June 30, 2007			June 30, 2006

Revenues:
Net premiums	$	279		$	365		$	948		$	652		$	1,227		$	1,017
Investment income, net of related expenses		21,974			9,812			22,257			8,983			44,231			18,795
Investment related gains (losses), net		(9,852	)		5,344			(1,963	)		(2,369	)		(11,815	)		2,975
Other revenues		3,639			2,214			1,961			(97	)		5,600			2,117

Total revenues		16,040			17,735			23,203			7,169			39,243			24,904

Benefits and expenses:
Claims and other policy benefits		(85	)		(846	)		113			(185	)		28			(1,031	)
Interest credited		—			110			—			643			—			753
Policy acquisition costs and other insurance expenses		(10,036	)		(8,179	)		(9,187	)		(10,551	)		(19,223	)		(18,730	)
Other operating expenses		13,458			11,861			9,998			11,540			23,456			23,401
Interest expense		20,453			16,767			23,232			15,014			43,685			31,781
Collateral finance facility expense		12,687			—			13,206			277			25,893			277

Total benefits and expenses		36,477			19,713			37,362			16,738			73,839			36,451

Loss before income taxes	$	(20,437	)	$	(1,978	)	$	(14,159	)	$	(9,569	)	$	(34,596	)	$	(11,547	)

assumptions based on historical loss experience, changes in the nature of the business, anticipated outcomes of claim disputes and claims for rescission, and projected future premium run-off, all of which may affect the level of the claim reserve liability. Due to the significant uncertainty associated with the run-off of this business, net income in future periods could be affected positively or negatively.

Liquidity and Capital Resources

The Holding Company

RGA is a holding company whose primary uses of liquidity include, but are not limited to, the immediate capital needs of its operating companies associated with the Company’s primary businesses, dividends paid by RGA to its shareholders, interest payments on its indebtedness, and repurchases of RGA common stock under a plan approved by the board of directors. 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 two operating subsidiaries, and dividends from operating subsidiaries. As the Company continues its expansion efforts, RGA will continue to be dependent on these sources of liquidity.

The Company believes that it has sufficient liquidity to fund its cash needs under various scenarios that include the potential risk of the early recapture of a reinsurance treaty by the ceding company and significantly higher than expected death claims. Historically, the Company has generated positive net cash flows from operations. However, in the event of significant unanticipated cash requirements beyond normal liquidity, the Company has multiple liquidity alternatives available based on market conditions and the amount and timing of the liquidity need. These options include borrowings under committed credit facilities, secured borrowings, the ability to issue long-term debt, capital securities or common equity and, if necessary, the sale of invested assets.

Cash Flows

The Company’s net cash flows provided by operating activities for the periods ended ~~March 31,~~June 30, 2007 and 2006 were ~~$287.9~~$511.2 million and ~~$152.1~~$307.9 million, respectively. Cash flows from operating activities are affected by the timing of premiums received, claims paid, and working capital changes. The ~~$135.8~~$203.3 million net increase in operating cash flows for the ~~three~~six months of 2007 compared to the same period in 2006 was primarily a result of cash inflows related to premiums and investment income increasing more than cash outflows related to claims, acquisition costs, income taxes and other operating expenses. Cash from premiums and investment income increased ~~$190.8~~$397.6 million and ~~$21.4~~$127.3 million, respectively, and was offset by higher operating cash outlays of ~~$76.4~~$321.6 million for the current ~~three~~six month period. The Company believes the short-term cash requirements of its business operations will be sufficiently met by the positive cash flows generated. Additionally, the Company believes it maintains a high quality fixed maturity portfolio with positive liquidity characteristics. These securities are available for sale and could be sold if necessary to meet the Company’s ~~short~~short- and long-term obligations.

Net cash ~~provided by (used in)~~used in investing activities was ~~$(382.4)~~$443.3 million and ~~$129.4~~$936.2 million in the first ~~three~~six months of 2007 and the comparable prior-year period, respectively. This change is primarily due to ~~the increase~~a decrease in ~~purchases of fixed maturity securities and~~ the change in ~~short-term investments and~~ other invested assets. Other invested assets ~~related~~grew substantially in June 2006 due to the ~~investment of~~net proceeds from the Company’s issuance of Senior Notes in March 2007. Also, contributing to the change was a $60.9 million decrease in securitized lending activities. The cash generated in 2006 by the change in short-term investments and other invested assets was used to repay the Company’s $100 million Senior Notes in April 2006.collateral finance facility. Additionally, the sales and purchases of fixed maturity securities are related to the management of the Company’s investment portfolios and the investment of excess cash generated by operating and financing activities.

These senior notes have been registered with the Securities and Exchange Commission. The net proceeds from the offering were approximately $295.3 million, a portion of which were used to pay down ~~$30.0~~$50.0 million of indebtedness under a U.S. bank credit ~~facility in March 2007. An additional $20.0 million was used to repay additional indebtedness under a bank credit facility in April 2007.~~facility. The remaining net proceeds are designated for general corporate purposes. Capitalized issue costs were approximately $2.6 million.

The Company maintains three revolving credit facilities. The largest is a syndicated credit facility with an overall capacity of $600.0 million that expires in September 2010. The overall capacity available for issuance of letters of credit is reduced by any cash borrowings made by the Company against this credit facility. The Company may borrow up to $300.0 million of cash under the facility. As of ~~March 31,~~June 30, 2007 the ~~Company’s~~Company had no outstanding cash balance ~~was $20.0 million~~ under this credit ~~facility, with an average interest rate of 5.74%.~~facility. The Company’s other credit facilities consist of a £15.0 million credit facility that expires in May ~~2007~~2008 and an ~~AUD$~~A$50.0 million Australian credit facility that expires in June 2011. The Company’s foreign denominated credit facilities had a combined outstanding balance of ~~$57.8~~$42.9 million as of ~~March 31,~~June 30, 2007.

As of ~~March 31,~~June 30, 2007, the average interest rate on all long-term and short-term debt outstanding, excluding the Company-obligated mandatorily redeemable preferred securities of subsidiary trust holding solely junior subordinated debentures of the Company (“Trust Preferred Securities”), was ~~6.37%~~6.38%. Interest is expensed on the face amount, or $225 million, of the Trust Preferred Securities at a rate of 5.75%.

Collateral Finance Facility

In June 2006, RGA’s subsidiary, Timberlake Financial, L.L.C. (“Timberlake Financial”), issued $850.0 million of Series A Floating Rate Insured Notes due June 2036 in a private placement. The notes were issued to fund the collateral requirements for statutory reserves required by the U.S. valuation of Life Policies Model Regulation (commonly referred to as Regulation XXX) on specified term life insurance policies reinsured by RGA Reinsurance Company. Proceeds from the notes, along with a $112.7 million direct investment by the Company, have been deposited into a series of trust accounts that collateralize the notes and are not available to satisfy the general obligations of the Company. Interest on the notes will accrue at an annual rate of 1-month LIBOR plus a base rate margin, payable monthly. The payment of interest and principal on the notes is insured through a financial guaranty insurance policy with a third party. The notes represent senior, secured indebtedness of Timberlake Financial with no recourse to RGA or its other subsidiaries. Timberlake Financial will rely primarily upon the receipt of interest and principal payments on a surplus note and dividend payments from its wholly-owned subsidiary, Timberlake Reinsurance Company II (“Timberlake Re”), a South Carolina captive insurance company, to make payments of interest and principal on the notes. The ability of Timberlake Re to make interest and principal payments on the surplus note and dividend payments to Timberlake Financial is contingent upon South Carolina regulatory approval and the performance of specified term life insurance policies with guaranteed level premiums retroceded by RGA’s subsidiary, RGA Reinsurance Company, to Timberlake Re.

In accordance with Financial Accounting Standards Board (“FASB”) Interpretation No. 46(r), “Consolidation of Variable Interest Entities — An Interpretation of ARB No. 51,” Timberlake Financial is considered to be a variable interest entity and the Company is deemed to hold the primary beneficial interest. As a result, Timberlake Financial has been consolidated in the Company’s condensed financial statements. The Company’s condensed consolidated balance sheets include the assets of Timberlake Financial recorded as fixed maturity investments and other invested assets, which consists of restricted cash and cash equivalents, with the liability for the notes recorded as collateral finance facility. The Company’s condensed consolidated statements of income include the investment return of Timberlake Financial as investment income and the cost of the facility is reflected in collateral finance facility expense.

Asset / Liability Management

The Company actively manages its 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,~~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.

include objectives for effective duration, yield curve sensitivity and convexity, liquidity, asset sector concentration and credit quality.

The Company’s liquidity position (cash and cash equivalents and short-term investments) was ~~$513.9~~$593.6 million and $300.7 million at ~~March 31,~~June 30, 2007 and December 31, 2006, respectively. The increase in the Company’s liquidity position from December 31, 2006 is primarily due to the timing of cash received late in the second quarter. 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.

The Company occasionally enters into sales of investment securities under agreements to repurchase the same securities to ~~help manage its short-term liquidity requirements.~~increase the Company’s earned yield on invested assets. These transactions are reported as securitized lending obligations within other liabilities. There were ~~$47.5~~$90.4 million of these agreements outstanding at ~~March 31,~~June 30, 2007 and there were no agreements outstanding at December 31, 2006.

Future Liquidity and Capital Needs

Based on the historic cash flows and the current financial results of the Company, subject to any dividend limitations which may be imposed by various insurance regulations, management believes RGA’s cash flows from operating activities, together with undeployed proceeds from its capital raising efforts, including interest and investment income on those proceeds, interest income received on surplus notes with two operating subsidiaries, and its ability to raise funds in the capital markets, will be sufficient to enable RGA to make dividend payments to its shareholders, to make interest payments on its senior indebtedness, trust preferred securities and junior subordinated notes, repurchase RGA common stock under the board of director approved plan and meet its other obligations.

A general economic downturn or a downturn in the equity and other capital markets could adversely affect the market for many annuity and life insurance products. Because the Company obtains substantially all of its revenues through reinsurance arrangements that cover a portfolio of life insurance products, as well as annuities, its business would be harmed if the market for annuities or life insurance were adversely affected.

Investments

The Company had total cash and invested assets of ~~$15.5~~$15.9 billion and $14.8 billion at ~~March 31,~~June 30, 2007 and December 31, 2006, respectively. All investments made by RGA and its subsidiaries conform to the qualitative and quantitative limits prescribed by the applicable jurisdiction’s insurance laws and regulations. In addition, the boards of directors of the various operating companies periodically review the investment portfolios of their respective subsidiaries. RGA’s board of directors also receives reports on material investment portfolios. The Company’s investment strategy is to maintain a predominantly investment-grade, fixed maturity portfolio, to provide adequate liquidity for expected reinsurance obligations, and to maximize total return through prudent asset management. The Company’s earned yield on invested assets, excluding funds withheld, was ~~5.93%~~5.90% in the ~~first~~second quarter of 2007, compared with ~~5.78%~~5.72% for the ~~first~~second quarter of 2006. See “Note 4 — Investments” in the Notes to Consolidated Financial Statements of the 2006 Annual Report for additional information regarding the Company’s investments.

The Company’s fixed maturity securities are invested primarily in commercial and industrial bonds, public utilities, U.S. and Canadian government securities, as well as mortgage- and asset-backed securities. As of ~~March 31,~~June 30, 2007, approximately 97.1% of the Company’s consolidated investment portfolio of fixed maturity securities was investment grade. Important factors in the selection of investments include diversification, quality, yield, total rate of return potential and call protection. The relative importance of these factors is determined by market conditions and the underlying product or portfolio characteristics. Cash equivalents are invested in high-grade money market instruments. The largest asset class in which fixed maturities were invested was in corporate securities, including commercial, industrial, finance and utility bonds, which represented approximately ~~53.6%~~53.5% of fixed maturity securities as of ~~March 31,~~June 30, 2007 and had an average Standard and Poor’s (“S&P”) rating of ~~“A-”~~“A”. The Company owns floating rate securities that represent approximately ~~18.3%~~19.5% of the total fixed maturity securities at ~~March 31,~~June 30, 2007. These investments have a higher degree of income variability than the other fixed income holdings in the portfolio due to the floating rate nature of the interest payments. The Company holds these investments to match specific floating rate liabilities primarily reflected in the condensed consolidated balance sheets as collateral finance facility.

securities at ~~March 31,~~June 30, 2007, which include credit card and automobile receivables, home equity loans, manufactured housing bonds and collateralized bond obligations. The Company’s asset-backed securities are diversified by issuer and contain both floating and fixed rate securities. In addition to the risks associated with floating rate securities, principal risks in holding asset-backed securities are structural, credit and capital market risks. Structural risks include the securities’ priority in the issuer’s capital structure, the adequacy of and ability to realize proceeds from collateral, and the potential for prepayments. Credit risks include consumer or corporate credits such as credit card holders, equipment lessees, and corporate obligors. Capital market risks include general level of interest rates and the liquidity for these securities in the marketplace. As of June 30, 2007, the Company held investments in securities with subprime mortgage exposure with an amortized cost totaling $300.2 million and an estimated fair value of $299.7 million. Those amounts include exposure to subprime mortgages through securities held directly in the Company’s investment portfolios as well as securities backing the Company’s funds withheld at interest investment. The securities are highly rated with a weighted average S&P credit rating of “AA+”. Additionally, the Company has largely avoided investing in securities originated in the second half of 2005 and beyond, which management believes was a period of lessened underwriting quality. The majority of the Company’s holdings are originations from 2005 and prior periods. In light of the high credit quality of the portfolio, the Company does not expect to realize any material losses despite the recent increase in default rates and market concern over future performance of this asset class.

The following table presents a summary of the securities by rating (dollars in thousands):


	Amortized				% of Fair
S&P Rating	Cost		Fair Value		Value
AAA	$	134,556	$	134,527		44.9	%
AA		116,268		115,976		38.7	%
A		48,054		47,823		16.0	%
BBB		1,325		1,332		0.4	%

Total	$	300,203	$	299,658		100.0	%

The Company monitors its fixed maturity securities to determine impairments in value and evaluates factors such as financial condition of the issuer, payment performance, the length of time and the extent to which the market value has been below amortized cost, compliance with covenants, general market conditions and industry sector, current intent and ability to hold securities and various other subjective factors. Based on management’s judgment, securities determined to have an other-than-temporary impairment in value are written down to fair value. The Company recorded ~~$0.6~~$1.9 million in other-than-temporary write-downs on fixed maturity securities for the ~~three~~six months ending ~~March 31,~~June 30, 2007. The Company ~~did not record~~recorded $0.2 million in other-than-temporary write-downs on fixed maturity securities for the ~~three~~six months ending ~~March 31,~~June 30, 2006. During the ~~three~~six months ended ~~March 31,~~June 30, 2007, the Company sold fixed maturity securities and equity securities with a fair value of ~~$238.8~~$629.0 million, which were below amortized cost, at a loss of ~~$6.1~~$18.4 million. Generally, such losses are insignificant in relation to the cost basis of the investment and are largely due to changes in interest rates from the time the security was purchased. The securities are classified as available-for-sale in order to meet the Company’s operational and other cash flow requirements. The Company does not engage in short-term buying and selling of securities to generate gains or losses.

The following table presents the total gross unrealized losses for ~~986~~1,341 fixed maturity securities and equity securities as of ~~March 31,~~June 30, 2007, where the estimated fair value had declined and remained below amortized cost by the indicated amount (dollars in thousands):


	At March 31, 2007					At June 30, 2007
	Gross Unrealized					Gross Unrealized
	Losses		% of Total			Losses		% of Total
Less than 20%	$	66,676		100.0	%	$	164,683		97.6	%
20% or more for less than six months		—		—			4,009		2.4	%
20% or more for six months or greater		—		—			—		—

Total	$	66,676		100.0	%	$	168,692		100.0	%


	As of March 31, 2007												As of June 30, 2007
					Equal to or greater than												Equal to or greater than
(dollars in thousands)	Less than 12 months				12 months				Total				Less than 12 months				12 months				Total
															Gross				Gross				Gross
	Estimated		Gross Unrealized		Estimated		Gross Unrealized		Estimated		Gross Unrealized		Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Loss		Fair Value		Loss		Fair Value		Loss		Fair Value		Loss		Fair Value		Loss		Fair Value		Loss
Investment grade securities:
Commercial and industrial	$	336,679	$	5,962	$	418,403	$	13,374	$	755,082	$	19,336	$	651,520	$	22,318	$	370,138	$	18,325	$	1,021,658	$	40,643
Public utilities		189,465		3,068		132,973		4,906		322,438		7,974		295,270		9,761		99,383		6,346		394,653		16,107
Asset-backed securities		284,156		1,719		22,944		256		307,100		1,975		281,962		2,655		19,389		400		301,351		3,055
Canadian and Canadian provincial governments		74,469		1,117		13,592		130		88,061		1,247		213,421		11,192		3,026		141		216,447		11,333
Mortgage-backed securities		754,215		4,201		572,876		10,567		1,327,091		14,768		1,251,600		23,080		490,875		18,848		1,742,475		41,928
Finance		532,025		5,036		242,630		6,897		774,655		11,933		1,041,635		25,573		148,215		9,899		1,189,850		35,472
U.S. government and agencies		—		—		985		22		985		22		105		—		981		25		1,086		25
State and political subdivisions		40,575		332		15,225		513		55,800		845		44,963		1,186		14,792		947		59,755		2,133
Foreign governments		158,050		3,937		59,102		1,375		217,152		5,312		168,873		6,385		70,416		2,250		239,289		8,635

Investment grade securities		2,369,634		25,372		1,478,730		38,040		3,848,364		63,412		3,949,349		102,150		1,217,215		57,181		5,166,564		159,331


Non-investment grade securities:
Commercial and industrial	$	42,226	$	544	$	46,153	$	862	$	88,379	$	1,406		65,560		2,045		56,016		2,108		121,576		4,153
Finance		8,728		86		—		—		8,728		86		13,322		281		—		—		13,322		281
Asset-backed securities		3,013		141		—		—		3,013		141
Public utilities		13,499		83		1,101		9		14,600		92		24,353		751		2,940		39		27,293		790

Non-investment grade securities		67,466		854		47,254		871		114,720		1,725		103,235		3,077		58,956		2,147		162,191		5,224

Total fixed maturity securities	$	2,437,100	$	26,226	$	1,525,984	$	38,911	$	3,963,084	$	65,137	$	4,052,584	$	105,227	$	1,276,171	$	59,328	$	5,328,755	$	164,555

Equity securities	$	39,247	$	756	$	21,465	$	783	$	60,712	$	1,539	$	96,121	$	3,069	$	18,227	$	1,068	$	114,348	$	4,137

owned and managed by the ceding company, and are reflected as funds withheld at interest on the Company’s condensed consolidated balance sheet. In the event of a ceding company’s insolvency, the Company would need to assert a claim on the assets supporting its reserve liabilities. However, the risk of loss to the Company is mitigated by its ability to offset amounts it owes the ceding company for claims or allowances with amounts owed to the Company from the ceding company. Interest accrues to these assets at rates defined by the treaty terms. The Company is subject to the investment performance on the withheld assets, although it does not directly control them. These assets are primarily fixed maturity investment securities and pose risks similar to the fixed maturity securities the Company owns. To mitigate risk, the Company helps set the investment guidelines followed by the ceding company and monitors compliance. Ceding companies with funds withheld at interest had a minimum A.M. Best rating of ~~“A”~~“A-”.

Other invested assets represented approximately ~~1.6%~~1.8% and 1.5% of the Company’s cash and invested assets as of ~~March 31,~~June 30, 2007 and December 31, 2006, respectively. Other invested assets include common stock, preferred stocks, restricted cash and cash equivalents and limited partnership interests. The Company did not record an other-than-temporary write-down on its investments in limited partnerships in the first ~~three~~six months of 2007. The Company recorded other-than-temporary writedowns of $3.1 million on its investments in limited partnerships in the ~~three~~six months ended ~~March 31,~~June 30, 2006.

Contractual Obligations

~~Other than~~The Company’s commitment to fund limited partnerships has increased since December 31, 2006 by $64.2 million to $96.9 million at June 30, 2007. Additionally, the Company’s obligation for long-term debt, including interest, increased primarily due to the March 2007 issuance of senior notes as previously ~~discussed, there was~~discussed. There were no other material ~~change~~changes in the Company’s contractual obligations from that reported in the 2006 Annual Report.

Mortality Risk Management

In the normal course of business, 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 retrocessionaires under excess coverage and coinsurance contracts. In the U.S., the Company retains a maximum of $6.0 million of coverage per individual life. In certain limited situations, due to the acquisition of in force blocks of business, the Company has retained more than $6.0 million per individual policy. In total, there are 3938 such cases of over-retained policies, for amounts averaging ~~$2.4~~$2.6 million over the Company’s normal retention limit. The largest amount over retained on any one life is $12.1 million. For other countries, particularly those with higher risk factors or smaller books of business, the Company systematically reduces its retention. The Company has a number of retrocession arrangements whereby certain business in force is retroceded on an automatic or facultative basis.

The Company maintains a catastrophe insurance program (“Program”) that renews on August 13th of each year. The current Program began August 13, 2006, and covers events involving 10 or more insured deaths from a single occurrence. The Company retains the first $25 million in claims, the Program covers the next $50 million in claims, and the Company retains all claims in excess of $75 million. The Program covers only losses under North American guaranteed issue (corporate owned life insurance, bank owned life insurance, etc.) reinsurance programs and includes losses due to acts of terrorism, but excludes terrorism losses due to nuclear, chemical and/or biological events. The Program is insured by several insurance companies and Lloyd’s Syndicates, with no single entity providing more than $10 million of coverage.

Counterparty Risk

In the normal course of business, the Company seeks to limit its exposure to reinsurance contracts by ceding a portion of the reinsurance to other insurance companies or reinsurers. Should a counterparty not be able to fulfill its obligation to the Company under a reinsurance agreement, the impact could be material to the Company’s financial condition and results of operations.

Generally, RGA’s insurance subsidiaries retrocede amounts in excess of their retention to RGA Reinsurance Company (“RGA Reinsurance”), RGA Reinsurance Company (Barbados) Ltd., or RGA Americas Reinsurance Company, Ltd. External retrocessions are arranged through the Company’s retrocession pools for amounts in excess of its retention. As of ~~March 31,~~June 30, 2007, all retrocession pool members in this excess retention pool reviewed by the A.M. Best Company were rated “B++”, the fifth highest rating out of fifteen possible ratings, or better. The

strain on statutory surplus created by this business. For a majority of the retrocessionaires that are not rated, letters of credit or trust assets have been given as additional security in favor of RGA Reinsurance. In addition, the Company performs annual financial and in force 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 material difficulty in collecting claims recoverable from retrocessionaires; however, no assurance can be given as to the future performance of such retrocessionaires or as to the recoverability of any such claims.

The Company relies upon its clients to provide timely, accurate information. The Company may experience volatility in its earnings as a result of erroneous or untimely reporting from its clients. The Company works closely with its clients and monitors this risk in an effort to minimize its exposure.

Market Risk

Market risk is the risk of loss that may occur when fluctuations in interest and currency exchange rates and equity and commodity prices change the value of a financial instrument. Both derivative and nonderivative financial instruments have market risk so the Company’s risk management extends beyond derivatives to encompass all financial instruments held that are sensitive to market risk. The Company is primarily exposed to interest rate risk and foreign currency risk.

Interest rate risk arises from many of the Company’s primary activities, as the Company invests substantial funds in interest-sensitive assets and also has certain interest-sensitive contract liabilities. The Company manages interest rate risk and credit risk to maximize the return on the Company’s capital effectively and to preserve the value created by its business operations. As such, certain management monitoring processes are designed to minimize the impact of sudden and sustained changes in interest rates on fair value, cash flows, and net interest income.

The Company is subject to foreign currency translation, transaction, and net income exposure. The Company generally does not hedge the foreign currency translation exposure related to its investment in foreign subsidiaries as it views these investments to be long-term. Translation differences resulting from translating foreign subsidiary balances to U.S. dollars are reflected in equity. The Company generally does not hedge the foreign currency exposure of its subsidiaries transacting business in currencies other than their functional currency (transaction exposure).

There has been no significant change in the Company’s quantitative or qualitative aspects of market risk during the quarter ended ~~March 31,~~June 30, 2007 from that disclosed in the 2006 Annual Report.

New Accounting Standards

2931

Company also had $29.8 million of accrued interest, as of January 1, 2007. The Company classifies interest accrued related to unrecognized tax benefits in interest expense, while penalties are included within income tax expense.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS 157”). SFAS 157 defines fair value, establishes a framework for measuring fair value in GAAP and requires enhanced disclosures about fair value measurements. SFAS 157 does not require any new fair value measurements. The pronouncement is effective for fiscal years beginning after November 15, 2007. The guidance in SFAS 157 will be applied prospectively with the exception of: (i) block discounts of financial instruments; and (ii) certain financial and hybrid instruments measured at initial recognition under SFAS 133, “Accounting for Derivative Instruments and Hedging Activities” (“SFAS 133”) which is to be applied retrospectively as of the beginning of initial adoption (a limited form of retrospective application). The Company is currently evaluating the impact of SFAS 157 and does not expect that the pronouncement will have a material impact on the Company’s condensed consolidated financial statements.

Forward-Looking and Cautionary Statements

This Quarterly Report on Form 10-Q 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 strategies, earnings, revenues, income or loss, ratios, future financial performance, and growth potential of the Company. The words “intend,” “expect,” “project,” “estimate,” “predict,” “anticipate,” “should,” “believe,” and other similar expressions also are intended to identify forward-looking statements. Forward-looking statements are inherently 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.

MetLife, Inc. (“MetLife”), the beneficial owner of a majority of the Company’s common shares, or its subsidiaries, and the effect of such changes on the Company’s future results of operations and financial condition, (3) inadequate risk analysis and underwriting, (4) general economic conditions or a prolonged economic downturn affecting the demand for insurance and reinsurance in the Company’s current and planned markets, (5) the availability and cost of collateral necessary for regulatory reserves and capital, (6) market or economic conditions that adversely affect the Company’s ability to make timely sales of investment securities, (7) 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, (8) fluctuations in U.S. or foreign currency exchange rates, interest rates, or securities and real estate markets, (9) adverse litigation or arbitration results, (10) the adequacy of reserves, resources and accurate information relating to settlements, awards and terminated and discontinued lines of business, (11) the stability of and actions by governments and economies in the markets in which the Company operates, (12) competitive factors and competitors’ responses to the Company’s initiatives, (13) the success of the Company’s clients, (14) successful execution of the Company’s entry into new markets, (15) successful development and introduction of new products and distribution opportunities, (16) the Company’s ability to successfully integrate and operate reinsurance business that the Company acquires, (17) regulatory action that may be taken by state Departments of Insurance with respect to the Company, MetLife, or its subsidiaries, (18) 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, (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) changes in laws, regulations, and accounting standards applicable to the Company, its subsidiaries, or its business, (21) the effect of the Company’s status as an insurance holding company and regulatory restrictions on its ability to pay principal of and interest on its debt obligations, and (22) 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 the cautionary statements 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 obligations to update these forward-looking statements, even though the Company’s situation may change in the future. The Company qualifies all of its forward-looking statements by these cautionary statements. 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 of the 2006 Annual Report.

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

See “Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations — Market Risk” which is included herein.

ITEM 4. Controls and Procedures

The Chief Executive Officer and the Chief Financial Officer have evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined in Exchange Act Rule 13a-15(e) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that these disclosure controls and procedures were effective.

There was no change in the Company’s internal control over financial reporting as defined in Exchange Act Rule 13a-15(f) during the quarter ended ~~March 31,~~June 30, 2007, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II — OTHER INFORMATION

ITEM 1. Legal Proceedings

The Company is currently a party to three arbitrations that involve its discontinued accident and health business, including personal accident business (which includes London market excess of loss business) and workers’ compensation carve-out business. The Company is also party to a threatened arbitration related to its life

by the ceding companies, and must rely on management estimates to establish policy claim liabilities. It is possible that any such reserves could be increased in the future. The Company believes it has substantial defenses upon which to contest these claims, including but not limited to misrepresentation and breach of contract by direct and indirect ceding companies. See Note 20, “Discontinued Operations” in the Company’s consolidated financial statements accompanying the 2006 Annual Report for more information. Additionally, from time to time, the Company is subject to litigation related to employment-related matters in the normal course of its business. The Company cannot predict or determine the ultimate outcome of the pending litigation or arbitrations or provide useful ranges of potential losses. It is the opinion of management, after consultation with counsel, that their outcomes, after consideration of the provisions made in the Company’s condensed consolidated financial statements, would not have a material adverse effect on its consolidated financial position. However, it is possible that an adverse outcome could, from time to time, have a material adverse effect on the Company’s consolidated net income in a particular quarter or ~~cash flows in particular quarterly or annual periods.~~year.

ITEM 1A. Risk Factors

There have been no material changes from the risk factors previously disclosed in the Company’s 2006 Annual Report.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

~~Issuer Purchases of Equity Securities~~

~~The following table summarizes the Company’s repurchase activity of its common stock during the first quarter ended March 31, 2007:~~

Total Number of Maximum Number of
Total Number of Shares Purchased as Shares that May Yet
Shares Purchased Average Price Paid Part of Publicly Be Purchased Under
(1) per Share Announced Plans the Plans

March 1, 2007 — March 31, 2007 65,082 $ 55.48 — —


~~(1)~~		In March 2007 the Company net settled — issuing 242,614 shares from treasury and repurchasing 65,082 shares in settlement of income tax withholding requirements incurred by recipients of an equity incentive award.

Under a board of directors approved plan, the Company may purchase at its discretion up to $50 million of its common stock on the open market. As of ~~March 31,~~June 30, 2007, the Company had purchased 225,500 shares of treasury stock under this program at an aggregate price of $6.6 million. All purchases were made during 2002. The Company generally uses treasury shares to support the future exercise of options granted under its stock option plans.

ITEM 4.

Submission of Matters to a Vote of Security Holders

The Company’s Annual Meeting of Shareholders was held on May 23, 2007. At the Annual Meeting, the following proposals were voted upon by the shareholders as indicated below:

(1)

Election of the following Directors:



Directors	Voted For		Withheld

William J. Bartlett		51,915,684		3,887,839
Alan C. Henderson		54,610,187		1,193,336
A. Greig Woodring		47,345,957		8,457,566


	Voted For		Voted Against		Abstain
(2) Proposal to authorize the sale of certain types of securities from time to time to MetLife, Inc. or its affiliates		41,272,380		12,174,004		31,887
(3) Proposal to approve an amendment to the Company’s Flexible Stock Plan		35,658,328		17,803,174		16,759

ITEM 6. Exhibits

See index to exhibits.

3234


	Three months ended
	March 31, 2007			March 31, 2006			Three months ended						Six months ended
							June 30, 2007			June 30, 2006			June 30, 2007			June 30, 2006
Net income	$	76,252		$	69,070		$	77,475		$	63,631		$	153,727		$	132,701
Accumulated other comprehensive income (expense), net of income tax:
Unrealized gains (losses), net of reclassification adjustment for gains (losses) included in net income		4,643			(114,630	)
Unrealized losses, net of reclassification adjustment for losses, net included in net income								(136,116	)		(116,249	)		(131,473	)		(230,879	)
Foreign currency items		14,057			(2,037	)		58,832			34,756			72,889			32,719
Pension and postretirement benefit adjustments		(30	)		—			(283	)		—			(313	)		—

Comprehensive income (loss)	$	94,922		$	(47,597	)	$	(92	)	$	(17,862	)	$	94,830		$	(65,459	)



				Non-Traditional						Total			Traditional			Non-Traditional						Total
							Financial			U.S.						Asset-			Financial			U.S.
	Traditional			Asset-Intensive			Reinsurance			Operations						Intensive			Reinsurance			Operations

Revenues:
Net premiums	$	611,837		$	1,474		$	—		$	613,311		$	662,301		$	1,605		$	—		$	663,906
Investment income, net of related expenses		71,042			70,897			(3	)		141,936			74,657			48,424			(152	)		122,929
Investment related losses, net		(1,229	)		(3,333	)		—			(4,562	)		(2,506	)		(2,511	)		—			(5,017	)
Change in value of embedded derivatives		—			4,552			—			4,552			—			(11,075	)		—			(11,075	)
Other revenues		(320	)		3,289			7,346			10,315			276			3,908			7,460			11,644

Total revenues		681,330			76,879			7,343			765,552			734,728			40,351			7,308			782,387

Benefits and expenses:
Claims and other policy benefits		508,146			(869	)		1			507,278			545,640			727			—			546,367
Interest credited		11,487			49,537			—			61,024			11,796			31,930			—			43,726
Policy acquisition costs and other insurance expenses		82,172			16,395			2,334			100,901			101,229			14,539			2,326			118,094
Change in deferred acquisition costs associated with change in value of embedded derivatives		—			2,757			—			2,757			—			(7,982	)		—			(7,982	)
Other operating expenses		10,126			1,776			1,354			13,256			8,732			1,413			1,102			11,247

Total benefits and expenses		611,931			69,596			3,689			685,216			667,397			40,627			3,428			711,452

Income before income taxes	$	69,399		$	7,283		$	3,654		$	80,336
Income (loss) before income taxes													$	67,331		$	(276	)	$	3,880		$	70,935


	Reinsurance Group of America, Incorporated
	By:	/s/ A. Greig Woodring ~~May 7,~~August 3, 2007
		A. Greig Woodring
		President & Chief Executive Officer (Principal Executive Officer)


	By:	/s/ Jack B. Lay ~~May 7,~~August 3, 2007
		Jack B. Lay
		Senior Executive Vice President & Chief Financial Officer (Principal Financial and Accounting Officer)


Exhibit
Number		Description

3.1		Restated Articles of Incorporation, incorporated by reference to Exhibit 3.1 of Current
		Report on Form 8-K filed June 30, 2004.

3.2		Bylaws of RGA, as amended, incorporated by reference to Exhibit 3.2 of Quarterly Report on
		Form 10-Q filed August 6, 2004.

~~4.2~~		~~Second Supplemental Senior Indenture, dated as of March 9, 2007, by and between the Company~~
		~~and The Bank of New York Trust Company, N.A., as successor trustee to The Bank of New York,~~
		~~incorporated by reference to Exhibit 4.2 to Form 8-K dated March 6, 2007 (File No. 1-11848),~~
		~~filed March 12, 2007.~~

31.1		Certification of Chief Executive Officer pursuant to section 302 of the Sarbanes-Oxley Act of
		2002.

31.2		Certification of Chief Financial Officer pursuant to section 302 of the Sarbanes-Oxley Act of
		2002.

32.1		Certification of Chief Executive Officer pursuant to section 906 of the Sarbanes-Oxley Act of
		2002.

32.2		Certification of Chief Financial Officer pursuant to section 906 of the Sarbanes-Oxley Act of
		2002.


					Income (loss) from continuing						Three months ended				Six months ended
	Total revenues				operations before income taxes						June 30, 2007		June 30, 2006		June 30, 2007		June 30, 2006
	Three months ended March 31,				Three months ended March 31,
	2007		2006		2007			2006
Total revenues
U.S.	$	839,081	$	765,552	$	93,177		$	80,336		$	927,982	$	782,387	$	1,767,063	$	1,547,939
Canada		128,794		119,508		15,034			8,431			156,684		126,230		285,478		245,738
Europe & South Africa		173,477		148,668		21,124			14,797			171,242		149,587		344,719		298,255
Asia Pacific		197,257		147,634		10,332			6,614			209,665		177,163		406,922		324,797
Corporate and Other		16,040		17,735		(20,437	)		(1,978	)
Corporate & Other												23,203		7,169		39,243		24,904

Total	$	1,354,649	$	1,199,097	$	119,230		$	108,200		$	1,488,776	$	1,242,536	$	2,843,425	$	2,441,633


	Three months ended March 31,
	Pension Benefits						Other Benefits
	2007			2006			2007		2006
Determination of net periodic benefit cost:
Service cost	$	799		$	614		$	206	$	179
Interest cost		592			477			190		156
Expected rate of return on plan assets		(455	)		(347	)		—		—
Amortization of prior service cost		95			9			—		—
Amortization of prior actuarial loss		113			106			84		66

Net periodic benefit cost	$	1,144		$	859		$	480	$	401