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, 2008


	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

~~Yes~~þ Noo

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YesoNoþ

Common stock outstanding ($.01 par value) as of ~~April 30,~~July 31, 2008: ~~62,281,408~~62,323,070 shares.

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


	March 31,			December 31,			June 30,			December 31,
	2008			2007			2008			2007
	(Dollars in thousands)						(Dollars in thousands)
Assets
Fixed maturity securities:
Available-for-sale at fair value (amortized cost of $9,139,814 and $8,916,692 at March 31, 2008 and December 31, 2007, respectively)	$	9,387,094		$	9,397,916
Available-for-sale at fair value (amortized cost of $9,594,910 and $8,916,692 at June 30, 2008 and December 31, 2007, respectively)							$	9,667,961		$	9,397,916
Mortgage loans on real estate		812,539			831,557			798,896			831,557
Policy loans		1,039,464			1,059,439			1,048,517			1,059,439
Funds withheld at interest		4,650,948			4,749,496			4,825,297			4,749,496
Short-term investments		46,336			75,062			47,081			75,062
Other invested assets		389,437			284,220			418,864			284,220

Total investments		16,325,818			16,397,690			16,806,616			16,397,690
Cash and cash equivalents		304,083			404,351			362,689			404,351
Accrued investment income		103,755			77,537			106,679			77,537
Premiums receivable and other reinsurance balances		766,970			717,228			800,404			717,228
Reinsurance ceded receivables		758,977			722,313			752,203			722,313
Deferred policy acquisition costs		3,369,316			3,161,951			3,460,294			3,161,951
Other assets		183,589			116,939			121,282			116,939

Total assets	$	21,812,508		$	21,598,009		$	22,410,167		$	21,598,009


Liabilities and Stockholders’ Equity
Future policy benefits	$	6,449,039		$	6,333,177		$	6,619,084		$	6,333,177
Interest-sensitive contract liabilities		6,657,546			6,657,061			7,220,659			6,657,061
Other policy claims and benefits		2,196,089			2,055,274			2,239,868			2,055,274
Other reinsurance balances		240,137			201,614			173,162			201,614
Deferred income taxes		707,963			760,633			561,912			760,633
Other liabilities		567,854			465,358			599,034			465,358
Short-term debt		—			29,773			—			29,773
Long-term debt		925,893			896,065			926,095			896,065
Collateral finance facility		850,210			850,361			850,000			850,361
Company-obligated mandatorily redeemable preferred securities of subsidiary trust holding solely junior subordinated debentures of the Company		158,904			158,861			158,946			158,861

Total liabilities		18,753,635			18,408,177			19,348,760			18,408,177

Commitments and contingent liabilities (See Note 7)

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, 2008 and December 31, 2007)		631			631
Common stock (par value $.01 per share; 140,000,000 shares authorized; 63,128,273 shares issued at June 30, 2008 and December 31, 2007)								631			631
Warrants		66,915			66,915			66,915			66,915
Additional paid-in-capital		1,112,977			1,103,956			1,115,540			1,103,956
Retained earnings		1,556,127			1,540,122			1,660,041			1,540,122
Accumulated other comprehensive income:
Accumulated currency translation adjustment, net of income taxes		203,662			221,987			215,582			221,987
Unrealized appreciation of securities, net of income taxes		167,174			313,170			47,478			313,170
Pension and postretirement benefits, net of income taxes		(8,199	)		(8,351	)		(8,082	)		(8,351	)

Total stockholders’ equity before treasury stock		3,099,287			3,238,430			3,098,105			3,238,430
Less treasury shares held of 893,575 and 1,096,775 at cost at March 31, 2008 and December 31, 2007, respectively		(40,414	)		(48,598	)
Less treasury shares held of 812,722 and 1,096,775 at cost at June 30, 2008 and December 31, 2007, respectively								(36,698	)		(48,598	)

Total stockholders’ equity		3,058,873			3,189,832			3,061,407			3,189,832

Total liabilities and stockholders’ equity	$	21,812,508		$	21,598,009		$	22,410,167		$	21,598,009

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,
	2008			2007			2008			2007			2008			2007
	(Dollars in thousands, except per share data)						(Dollars in thousands, except per share data)
Revenues:
Net premiums	$	1,298,065		$	1,125,450		$	1,358,555		$	1,207,646		$	2,656,620		$	2,333,096
Investment income, net of related expenses		199,526			215,743			254,868			274,902			454,394			490,645
Investment related losses, net		(155,260	)		(5,646	)		(7,079	)		(14,218	)		(162,339	)		(19,864	)
Other revenues		17,936			19,102			36,262			20,446			54,198			39,548

Total revenues		1,360,267			1,354,649			1,642,606			1,488,776			3,002,873			2,843,425
Benefits and Expenses:
Claims and other policy benefits		1,119,512			902,810			1,128,827			980,338			2,248,339			1,883,148
Interest credited		73,897			61,066			63,000			113,652			136,897			174,718
Policy acquisition costs and other insurance expenses		16,262			182,981			189,272			178,016			205,534			360,997
Other operating expenses		63,340			55,422			61,997			56,619			125,337			112,041
Interest expense		23,094			20,453			21,580			23,232			44,674			43,685
Collateral finance facility expense		7,474			12,687			6,966			13,206			14,440			25,893

Total benefits and expenses		1,303,579			1,235,419			1,471,642			1,365,063			2,775,221			2,600,482
Income from continuing operations before income taxes		56,688			119,230			170,964			123,713			227,652			242,943
Provision for income taxes		20,099			42,293			60,158			44,676			80,257			86,969

Income from continuing operations		36,589			76,937			110,806			79,037			147,395			155,974
Discontinued operations:
Loss from discontinued accident and health operations, net of income taxes		(5,084	)		(685	)		(104	)		(1,562	)		(5,188	)		(2,247	)

Net income	$	31,505		$	76,252		$	110,702		$	77,475		$	142,207		$	153,727


Basic earnings per share:
Income from continuing operations	$	0.59		$	1.25		$	1.78		$	1.28		$	2.37		$	2.53
Discontinued operations		(0.08	)		(0.01	)		—			(0.03	)		(0.08	)		(0.04	)

Net income	$	0.51		$	1.24		$	1.78		$	1.25		$	2.29		$	2.49


Diluted earnings per share:
Income from continuing operations	$	0.57		$	1.20		$	1.73		$	1.22		$	2.30		$	2.43
Discontinued operations		(0.08	)		(0.01	)		—			(0.02	)		(0.08	)		(0.04	)

Net income	$	0.49		$	1.19		$	1.73		$	1.20		$	2.22		$	2.39


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 March 31,						Six months ended June 30,
	2008			2007			2008			2007
	(Dollars in thousands)						(Dollars in thousands)
Cash Flows from Operating Activities:
Net income	$	31,505		$	76,252		$	142,207		$	153,727
Adjustments to reconcile net income to net cash provided by operating activities:
Change in:
Accrued investment income		(26,493	)		(23,467	)		(27,922	)		(26,440	)
Premiums receivable and other reinsurance balances		(49,386	)		38,673			(92,232	)		42,087
Deferred policy acquisition costs		(204,731	)		(30,186	)		(285,759	)		(82,761	)
Reinsurance ceded balances		(36,664	)		(16,657	)		(29,890	)		(36,197	)
Future policy benefits, other policy claims and benefits, and other reinsurance balances		330,732			183,149			468,180			373,895
Deferred income taxes		43,762			37,264			(39,703	)		77,666
Other assets and other liabilities, net		(48,290	)		17,056			102,314			16,477
Amortization of net investment premiums, discounts and other		(23,199	)		(9,551	)		(50,866	)		(29,674	)
Investment related losses, net		155,260			5,646			162,339			19,864
Loss on reinsurance embedded derivative		14,347			—
Excess tax benefits from share-based payment arrangement		(3,547	)		(1,387	)		(3,732	)		(2,839	)
Other, net		5,219			8,306			21,394			9,656

Net cash provided by operating activities		188,515			285,098			366,330			515,461

Cash Flows from Investing Activities:
Sales of fixed maturity securities available-for-sale		575,587			465,349			1,237,413			1,132,529
Maturities of fixed maturity securities available-for-sale		53,521			37,556			81,275			106,051
Purchases of fixed maturity securities available-for-sale		(832,146	)		(795,437	)		(1,812,224	)		(1,531,894	)
Cash invested in mortgage loans on real estate		—			(27,023	)		—			(91,194	)
Cash invested in policy loans								(9,054	)		(8,750	)
Cash invested in funds withheld at interest		(26,946	)		(23,114	)		(54,425	)		(46,636	)
Net increase on securitized lending activities		21,267			47,548			12,806			90,398
Principal payments on mortgage loans on real estate		18,799			11,147			32,625			24,818
Principal payments on policy loans		19,975			47			19,976			5,929
Change in short-term investments and other invested assets		(76,318	)		(98,434	)		(118,431	)		(124,582	)

Net cash used in investing activities		(246,261	)		(382,361	)		(610,039	)		(443,331	)

Cash Flows from Financing Activities:
Dividends to stockholders		(5,585	)		(5,530	)		(11,190	)		(11,097	)
Proceeds from long-term debt issuance		—			295,311			—			295,311
Net repayments under credit agreements		—			(30,000	)		—			(66,602	)
Purchases of treasury stock		(3,093	)		(3,611	)		(3,104	)		(3,611	)
Excess tax benefits from share-based payment arrangement		3,547			1,387			3,732			2,839
Exercise of stock options, net		1,489			4,093			3,981			12,146
Net change in payables for securities sold under agreements to repurchase		31,912			—			(30,094	)		—
Excess payments on universal life and other investment type policies and contracts		(70,750	)		(10,363	)
Excess deposits (payments) on universal life and other investment type policies and contracts								237,503			(49,443	)

Net cash provided by (used in) financing activities		(42,480	)		251,287
Net cash provided by financing activities								200,828			179,543
Effect of exchange rate changes on cash		(42	)		770			1,219			2,787

Change in cash and cash equivalents		(100,268	)		154,794			(41,662	)		254,460
Cash and cash equivalents, beginning of period		404,351			160,428			404,351			160,428

Cash and cash equivalents, end of period	$	304,083		$	315,222		$	362,689		$	414,888


Supplementary information:
Cash paid for interest	$	20,824		$	16,902		$	52,128		$	50,267
Cash paid for income taxes, net of refunds	$	12,095		$	2,107		$	22,250		$	22,440

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1. Organization and Basis of Presentation

Reinsurance Group of America, Incorporated (“RGA”) is an insurance holding company that was formed on December 31, 1992. As of June 30, 2008, General American Life Insurance Company (“General American”), a Missouri life insurance company, directly owned approximately 51.7% of the outstanding shares of common stock of RGA. General American is a wholly-owned subsidiary of MetLife, Inc. (“MetLife”), a New York-based insurance and financial services holding company. On June 2, 2008 MetLife and RGA jointly announced a proposed transaction that could lead to MetLife disposing of its majority interest in RGA. The transaction is subject to various conditions, including RGA shareholder and regulatory approvals, and could be completed as early as the third quarter of this year.

The accompanying unaudited condensed consolidated financial statements of ~~Reinsurance Group of America, Incorporated (“RGA”)~~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, 2008 are not necessarily indicative of the results that may be expected for the year ending December 31, 2008. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2007 Annual Report on Form 10-K (“2007 Annual Report”) filed with the Securities and Exchange Commission on February 28, 2008.

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 ~~2008~~current presentation.

2. Summary of Significant Accounting Policies

Effective January 1, 2008, the Company adopted Statement of Financial Accounting Standard (“SFAS”) No. 157, “Fair Value Measurements” (“SFAS 157”). SFAS 157 defines fair value, establishes a framework for measuring fair value, establishes a fair value hierarchy based on the quality of inputs used to measure fair value and enhances disclosure requirements for fair value measurements. In compliance with SFAS No. 157, the Company has categorized its financial instruments, based on the priority of the inputs to the valuation technique, into a three level hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).

If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument.

In accordance with SFAS 157, assets and liabilities recorded at fair value on the condensed consolidated balance sheets are categorized as follows:


	Level 1.		Unadjusted quoted prices in active markets for identical assets or liabilities.


	Level 2.		Quoted prices in markets that are not active or inputs that are observable either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities other than quoted prices in Level 1; quoted prices in markets that are not active; or other inputs that are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assts or liabilities.


	Level 3.		Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions that market participants would use in pricing the asset or liability. Level 3

5. Fair Value Disclosures

Effective January 1, 2008, the Company adopted SFAS 157, which defines fair value, establishes a consistent framework for measuring fair value and expands disclosure requirements about fair value measurements. SFAS 157, among other things, requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company’s adoption of SFAS 157 resulted in a pre-tax gain of approximately $3.9 million, included in interest credited, related primarily to the decrease in the fair value of ~~liability~~ embedded ~~derivatives~~derivative liabilities associated with equity-indexed annuity products primarily from the incorporation of nonperformance risk, also referred to as the Company’s own credit risk, into the fair value calculation.

SFAS 157 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. In accordance with SFAS 157, valuation techniques utilized by management for invested assets and embedded derivatives reported at fair value are generally categorized into three types:

Market Approach.Market approach valuation techniques use prices and other relevant information from market transactions involving identical or comparable assets or liabilities. Valuation techniques consistent with the market approach include comparables and matrix pricing. Comparables use market multiples, which might lie in ranges with a different multiple for each comparable. The selection of where within the range the appropriate multiple falls requires judgment, considering both quantitative and qualitative factors specific to the measurement. Matrix pricing is a mathematical technique used principally to value certain securities without relying exclusively on quoted prices for the specific securities but comparing the securities to benchmark or comparable securities.

Income Approach.Income approach valuation techniques convert future amounts, such as cash flows or earnings, to a single present amount, or a discounted amount. These techniques rely on current expectations of future amounts. Examples of income approach valuation techniques include present value techniques, option-pricing models and binomial or lattice models that incorporate present value techniques.

Cost Approach.Cost approach valuation techniques are based upon the amount that, at present, would be required to replace the service capacity of an asset, or the current replacement cost. That is, from the perspective of a market participant (seller), the price that would be received for the asset is determined based on the cost to a market participant (buyer) to acquire or construct a substitute asset of comparable utility.

The three approaches described within SFAS 157 are consistent with generally accepted valuation methodologies. While all three approaches are not applicable to all assets or liabilities reported at fair value, where appropriate and possible, one or more valuation techniques may be used. The selection of the valuation method(s) to apply considers the definition of an exit price and the nature of the asset or liability being valued, and significant expertise and judgment is required. The Company performs regular analysis and review of the various methodologies utilized in determining fair value to ensure that the valuation approaches utilized are appropriate and consistently applied, and that the various assumptions are reasonable. This process involves quantitative and qualitative analysis. Examples of procedures performed include, but are not limited to, review of pricing trends and monitoring of recent trade information. In addition, the Company utilizes both internal and external cash flow models to analyze the reasonableness of fair values, where appropriate.

For invested assets reported at fair value, when available, fair values are based on quoted prices in active markets that are regularly and readily obtainable. Generally, these are very liquid investments and the valuation does not require management judgment. When quoted prices in active markets are not available, fair value is based on the market valuation techniques described above, primarily a combination of the market approach, including matrix pricing and the income approach. The assumptions and inputs used by management in applying these methodologies include, but are not limited to: interest rates, credit standing of the issuer or counterparty, industry sector of the issuer, coupon rate, call provisions, sinking fund requirements, maturity, estimated duration and assumptions regarding liquidity and future cash flows.

The significant inputs to the market standard valuation methodologies for certain types of securities with reasonable levels of price transparency are inputs that are observable in the market or can be derived principally from or corroborated by observable market data. Such observable inputs include benchmarking prices for similar assets in active, liquid markets, quoted prices in markets that are not active and observable yields and spreads in the market.

When observable inputs are not available, the market standard valuation methodologies for determining the estimated fair value of certain types of securities that trade infrequently, and therefore have little or no price transparency, rely on inputs that are significant to the estimated fair value that are not observable in the market or cannot be derived principally from or corroborated by observable market data. These unobservable inputs can be based in large part on management judgment or estimation, and cannot be supported by reference to market activity. Even though unobservable, these inputs are based on assumptions deemed appropriate given the circumstances and are consistent with what other market participants would use when pricing such securities.

The use of different methodologies, assumptions and inputs may have a material effect on the estimated fair values of the Company’s securities holdings.

For embedded derivative liabilities associated with the underlying products in reinsurance treaties, primarily equity-indexed annuity treaties, the Company utilizes a market standard method, which includes an estimate of future equity option purchases and an adjustment for the Company’s own credit risk that takes into consideration the Company’s financial strength rating, also commonly referred to as a claims paying rating. The capital market inputs to the model, such as equity indexes, equity volatility, interest rates and the Company’s credit adjustment, are generally observable. However, the valuation models also use inputs requiring certain actuarial assumptions such as future interest margins, policyholder behavior, including future equity participation rates, and explicit risk margins related to non-capital market inputs, that are generally not observable and may require use of significant management judgment. Changes in interest rates, equity indices, equity volatility, the Company’s own credit risk, and actuarial assumptions regarding policyholder behavior may result in significant fluctuations in the value of embedded derivatives liabilities associated with equity-indexed annuity reinsurance treaties.

The fair value of embedded derivatives associated with funds withheld reinsurance treaties is determined based upon a total return swap methodology with reference to the fair value of the investments held by the ceding Company that support the Company’s funds withheld at interest asset. The fair value of the underlying assets is generally based on market observable inputs using market standard valuation methodologies. However, the valuation also requires certain significant inputs based on actuarial assumptions about policyholder behavior, which are generally not observable.

For the quarter ended June 30, 2008, the application of valuation methodologies applied to similar assets and liabilities has been consistent.

SFAS 157 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:


Level 1		Quoted prices in active markets for identical assets or liabilities. The Company’s Level 1 assets and liabilities include investment securities and derivative contracts that are traded in exchange markets.


Level 2		Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or ~~other~~market standard valuation methodologies and assumptions with significant inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. The Company’s Level 2 assets and liabilities include investment securities with quoted prices that are traded less frequently than exchange-traded instruments and derivative contracts whose ~~value is~~values are determined using ~~a pricing model with inputs that are observable in the~~ market ~~or can be derived principally from or corroborated by observable market data.~~standard valuation methodologies. This category primarily includes U.S. and foreign corporate securities, Canadian and Canadian provincial government securities, and residential and commercial mortgage-backed securities, among others. ~~Most~~Management values most of these securities ~~are valued based on prices provided by third party pricing services with~~using inputs that are market observable.


Level 3		Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the related assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using ~~pricing models, discounted cash flow~~market standard valuation methodologies ~~or similar techniques, as well as instruments~~described above. When observable inputs are not available, the market standard methodologies for ~~which~~determining the ~~determination of~~estimated fair value ~~requires~~of certain securities that trade infrequently, and therefore have little transparency, rely on inputs that are significant to the estimated fair value and that are not observable in the market or cannot be derived principally from or corroborated by observable market data. These unobservable inputs can be based in large part on management judgment or ~~estimation.~~estimation and cannot be supported by reference to market activity.


		Even though unobservable, management believes these inputs are based on assumptions deemed appropriate given the circumstances and consistent with what other market participants would use when pricing similar assets and liabilities. For the Company’s invested assets, this category generally includes U.S. and foreign corporate securities (primarily private placements), asset-backed securities (including those with exposure to subprime mortgages), and to a lesser extent, certain residential and commercial mortgage-backed securities, among others. Certain investment securities are priced via independent, non-binding, broker quotes which utilize inputs that may be difficult to corroborate with observable market data. Such securities are classified in Level 3. Additionally, the Company’s embedded derivatives, all of which are associated with reinsurance treaties, are classified in Level 3 since their values include significant unobservable inputs associated with actuarial assumptions regarding policyholder behavior. Embedded derivatives are reported with the host instruments on the condensed consolidated balance sheet.

As required by SFAS 157, when inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest priority level input that is significant to the fair value measurement in its entirety. For example, a Level 3 fair value measurement may include inputs that are observable (Levels 1 and 2) and unobservable (Level 3). Therefore, gains and losses for such assets and liabilities categorized within Level 3 may include changes in fair value that are attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3).

Assets and liabilities measured at fair value on a recurring basis are summarized below(dollars in thousands).


	March 31, 2008											June 30, 2008
				Fair Value Measurements Using:											Fair Value Measurements Using:
	Total			Level 1		Level 2			Level 3			Total			Level 1		Level 2			Level 3

Assets:
Fixed maturity securities — available-for-sale:
Fixed maturity securities – available-for-sale:
U.S. corporate securities	$	3,313,092		$	—	$	2,487,590		$	825,502		$	3,372,299		$	—	$	2,574,313		$	797,986
Canadian and Canadian provincial governments		2,113,830			—		2,087,069			26,761			2,155,928			—		2,132,109			23,819
Residential mortgage-backed securities		1,325,631			—		1,235,210			90,421			1,272,537			—		1,154,622			117,915
Foreign corporate securities		1,081,715			1,895		985,762			94,058			1,136,256			1,874		1,014,266			120,116
Asset-backed securities		446,031			—		114,375			331,656			452,347			—		127,134			325,213
Commercial mortgage-backed securities		686,678			—		628,144			58,534			842,140			—		797,134			45,006
U.S. government and agencies securities		3,656			3,497		159			—			8,488			1,246		7,242			—
State and political subdivision securities		64,074			7,692		—			56,382			42,609			6,990		—			35,619
Other foreign government securities		352,387			117,128		209,407			25,852			385,357			111,347		237,311			36,699

Total fixed maturity securities — available-for-sale		9,387,094			130,212		7,747,716			1,509,166
Funds withheld at interest — embedded derivatives		(233,618	)		—		—			(233,618	)
Other invested assets — equity securities		163,721			113,748		29,771			20,202
Other invested assets — derivatives		10,243			—		10,243			—
Reinsurance ceded receivable — embedded derivatives		78,216			—		—			78,216
Total fixed maturity securities – available-for-sale													9,667,961			121,457		8,044,131			1,502,373
Funds withheld at interest – embedded derivatives													(245,070	)		—		—			(245,070	)
Short-term investments													1,927			—		1,927			—
Other invested assets – equity securities													190,365			138,275		40,751			11,339
Other invested assets – derivatives													4,853			—		4,853			—
Reinsurance ceded receivable – embedded derivatives													81,163			—		—			81,163

Total	$	9,405,656		$	243,960	$	7,787,730		$	1,373,966		$	9,701,199		$	259,732	$	8,091,662		$	1,349,805


Liabilities:
Interest sensitive contract liabilities — embedded derivatives	$	(585,572	)	$	—	$	—		$	(585,572	)
Other liabilities — derivatives		(301	)		—		(301	)		—
Interest sensitive contract liabilities – embedded derivatives												$	(588,870	)	$	—	$	—		$	(588,870	)
Other liabilities – derivatives													(4,491	)		—		(4,491	)		—

Total	$	(585,873	)	$	—	$	(301	)	$	(585,572	)	$	(593,361	)	$	—	$	(4,491	)	$	(588,870	)

The ~~table~~tables below ~~presents a reconciliation~~present reconciliations for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended ~~March 31,~~June 30, 2008(dollars in thousands).


	Total Fair Value Measurements for the three months ended March 31, 2008																		Total Fair Value Measurements for the three months ended June 30, 2008
				Total gains/losses																		Total gains/losses
				(realized/unrealized) included in:																		(realized/unrealized) included in:
										Purchases,																		Purchases,			Transfers
	Balance						Other			issuances			Transfers			Balance			Balance						Other			issuances			in and/or			Balance
	January 1,						comprehensive			and			in and/or			March 31,			April 1,						comprehensive			and			out of			June 30,
	2008			Earnings			income			disposals			out of Level 3			2008			2008			Earnings, net			loss			disposals			Level 3			2008

Assets:
Fixed maturity securities available-for-sale	$	1,500,054		$	(7,110	)	$	(36,121	)	$	71,283		$	(18,940	)	$	1,509,166		$	1,509,166		$	(442	)	$	(41,661	)	$	55,804		$	(20,494	)	$	1,502,373
Funds withheld at interest — embedded derivatives		(85,090	)		(148,528	)		—			—			—			(233,618	)
Other invested assets — equity securities		13,950			1			(479	)		6,730			—			20,202
Reinsurance ceded receivable — embedded derivatives		68,298			6,045			—			3,873			—			78,216
Funds withheld at interest – embedded derivatives																				(233,618	)		(11,452	)		—			—			—			(245,070	)
Other invested assets – equity securities																				20,202			1			(1,241	)		7,000			(14,623	)		11,339
Reinsurance ceded receivable – embedded derivatives																				78,216			(1,459	)		—			4,406			—			81,163

Total	$	1,497,212		$	(149,592	)	$	(36,600	)	$	81,886		$	(18,940	)	$	1,373,966		$	1,373,966		$	(13,352	)	$	(42,902	)	$	67,210		$	(35,117	)	$	1,349,805


Liabilities:
Interest sensitive contract liabilities — embedded derivatives	$	(531,160	)	$	(43,678	)	$	—		$	(10,734	)	$	—		$	(585,572	)
Interest sensitive contract liabilities – embedded derivatives																			$	(585,572	)	$	5,983		$	—		$	(9,281	)	$	—		$	(588,870	)

Total	$	(531,160	)	$	(43,678	)	$	—		$	(10,734	)	$	—		$	(585,572	)	$	(585,572	)	$	5,983		$	—		$	(9,281	)	$	—		$	(588,870	)

The ~~table~~tables below ~~summarizes~~summarize gains and losses due to changes in fair value, including both realized and unrealized gains and losses, recorded in earnings for Level 3 assets and liabilities for the three and six months ended ~~March 31,~~June 30, 2008(dollars in thousands).

Total Gains and Losses
Classification of gains/losses (realized/unrealized) included in earnings for the three months
ended March 31, 2008
Policy
acquisition
Investment Investment Claims costs and
income, net related & other other
of related gains Other policy insurance
expenses (losses), net revenues benefits Interest credited expenses Total

Assets:
Fixed maturity
securities —
available-for-sale $ (188 ) $ (6,922 ) $ — $ — $ — $ — $ (7,110 )
Funds withheld at interest — embedded derivatives — (148,528 ) — — — — (148,528 )
Other invested assets — equity securities 1 — — — — — 1
Reinsurance ceded receivable — embedded derivatives — — — — — 6,045 6,045

Total $ (187 ) $ (155,450 ) $ — $ — $ — $ 6,045 $ (149,592 )

Liabilities:
Interest sensitive contract liabilities — embedded derivatives $ — $ (6,487 ) $ — $ 451 $ (37,642 ) $ — $ (43,678 )

Total $ — $ (6,487 ) $ — $ 451 $ (37,642 ) $ — $ (43,678 )

The table below summarizes changes in unrealized gains or losses recorded in earnings for the three months ended March 31, 2008 for Level 3 assets and liabilities that are still held at March 31, 2008(dollars in thousands).

Changes in Unrealized Gains and Losses
Changes in unrealized gains/losses relating to assets and liabilities still held at the reporting
date for the three months ended March 31, 2008
Policy
acquisition
Investment Investment Claims costs
income, net related & other and other
of related gains Other policy Interest insurance
expenses (losses), net revenues benefits credited expenses Total
Assets:
Fixed maturity securities — available-for-sale $ (198 ) $ (1,979 ) $ — $ — $ — $ — $ (2,177 )
Funds withheld at interest — embedded derivatives — (148,528 ) — — — — (148,528 )
Other invested assets — equity securities 1 — — — — — 1
Reinsurance ceded receivable — embedded derivatives — — — — — 7,811 7,811

Total $ (197 ) $ (150,507 ) $ — $ — $ — $ 7,811 $ (142,893 )

Liabilities:
Interest sensitive contract liabilities — embedded derivatives $ — $ (6,487 ) $ — $ 71 $ (53,245 ) $ — $ (59,661 )

Total $ — $ (6,487 ) $ — $ 71 $ (53,245 ) $ — $ (59,661 )

Total Gains and Losses
Classification of gains/losses (realized/unrealized) included in earnings for the three months
ended June 30, 2008
Policy
Investment Claims & acquisition
income, net Investment other costs and other
of related related gains policy Interest insurance
expenses (losses), net benefits credited expenses Total

Assets:
Fixed maturity securities – available-for-sale $ 345 $ (787 ) $ — $ — $ — $ (442 )
Funds withheld at interest – embedded derivatives — (11,452 ) — — — (11,452 )
Other invested assets – equity securities 1 — — — — 1
Reinsurance ceded receivable – embedded derivatives — — — — (1,459 ) (1,459 )

Total $ 346 $ (12,239 ) $ — $ — $ (1,459 ) $ (13,352 )

Liabilities:
Interest sensitive contract liabilities – embedded derivatives $ — $ 7,428 $ 1,271 $ (2,716 ) $ — $ 5,983

Total $ — $ 7,428 $ 1,271 $ (2,716 ) $ — $ 5,983

Total Gains and Losses
Classification of gains/losses (realized/unrealized) included in earnings for the six months
ended June 30, 2008
Policy
Investment Claims & acquisition
income, net Investment other costs and other
of related related gains policy Interest insurance
expenses (losses), net benefits credited expenses Total

Assets:
Fixed maturity securities – available-for-sale $ 157 $ (7,709 ) $ — $ — $ — $ (7,552 )
Funds withheld at interest – embedded derivatives — (159,980 ) — — — (159,980 )
Other invested assets – equity securities 2 — — — — 2
Reinsurance ceded receivable – embedded derivatives — — — — 4,586 4,586

Total $ 159 $ (167,689 ) $ — $ — $ 4,586 $ (162,944 )

Liabilities:
Interest sensitive contract liabilities – embedded derivatives $ — $ 942 $ 1,721 $ (40,358 ) $ — $ (37,695 )

Total $ — $ 942 $ 1,721 $ (40,358 ) $ — $ (37,695 )

1012

The tables below summarize changes in unrealized gains or losses recorded in earnings for the three and six months ended June 30, 2008 for Level 3 assets and liabilities that are still held at June 30, 2008(dollars in thousands).

Changes in Unrealized Gains and Losses
Changes in unrealized gains/losses relating to assets and liabilities still held at the reporting
date for the three months ended June 30, 2008
Policy
Investment Claims & acquisition
income, net Investment other costs and other
of related related gains policy Interest insurance
expenses (losses), net benefits credited expenses Total

Assets:
Fixed maturity securities – available-for-sale $ 354 $ (116 ) $ — $ — $ — $ 238
Funds withheld at interest – embedded derivatives — (11,452 ) — — — (11,452 )
Other invested assets – equity securities 1 — — — — 1
Reinsurance ceded receivable – embedded derivatives — — — — (314 ) (314 )

Total $ 355 $ (11,568 ) $ — $ — $ (314 ) $ (11,527 )

Liabilities:
Interest sensitive contract liabilities – embedded derivatives $ — $ 7,428 $ 2,419 $ (19,845 ) $ — $ (9,998 )

Total $ — $ 7,428 $ 2,419 $ (19,845 ) $ — $ (9,998 )

Changes in Unrealized Gains and Losses
Changes in unrealized gains/losses relating to assets and liabilities still held at the reporting
date for the six months ended June 30, 2008
Policy
Investment Claims & acquisition
income, net Investment other costs and other
of related related gains policy Interest insurance
expenses (losses), net benefits credited expenses Total

Assets:
Fixed maturity securities – available-for-sale $ 156 $ (2,095 ) $ — $ — $ — $ (1,939 )
Funds withheld at interest – embedded derivatives — (159,980 ) — — — (159,980 )
Other invested assets – equity securities 2 — — — — 2
Reinsurance ceded receivable – embedded derivatives — — — — 7,496 7,496

Total $ 158 $ (162,075 ) $ — $ — $ 7,496 $ (154,421 )

Liabilities:
Interest sensitive contract liabilities – embedded derivatives $ — $ 942 $ 2,489 $ (73,090 ) $ — $ (69,659 )

Total $ — $ 942 $ 2,489 $ (73,090 ) $ — $ (69,959 )

6. Segment Information

The accounting policies of the segments are the same as those described in the Summary of Significant Accounting Policies in Note 2 of the consolidated financial statements accompanying the 2007 Annual Report. The Company measures segment performance primarily based on profit or loss from operations before income taxes. There are no intersegment reinsurance transactions and the Company does not have any material long-lived ~~assets other than internally developed software.~~assets. Investment

income is allocated to the segments based upon average assets and related capital levels deemed appropriate to support the segment business volumes.

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 the Company’s businesses. As a result of the economic capital allocation process, a portion of investment income and investment related gains and 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.

Information related to total revenues, income (loss) from continuing operations before income taxes, and total assets of the Company for each reportable segment are summarized below(dollars in thousands).


											Three months ended						Six months ended
											June 30, 2008			June 30, 2007			June 30, 2008			June 30, 2007

Total revenues
U.S.											$	942,555		$	927,982		$	1,654,349		$	1,767,063
Canada												192,430			156,684			363,383			285,478
Europe & South Africa												194,205			171,242			391,757			344,719
Asia Pacific												290,454			209,665			545,869			406,922
Corporate & Other												22,962			23,203			47,515			39,243

Total											$	1,642,606		$	1,488,776		$	3,002,873		$	2,843,425

					Income (loss) from continuing
	Total revenues				operations before income taxes						Three months ended						Six months ended
	Three months ended March 31,				Three months ended March 31,						June 30, 2008			June 30, 2007			June 30, 2008			June 30, 2007
	2008		2007		2008			2007

Income (loss) from continuing operations before income taxes
U.S.	$	711,794	$	839,081	$	15,285		$	93,177		$	109,166		$	86,215		$	124,451		$	179,392
Canada		170,953		128,794		23,671			15,034			26,778			24,202			50,449			39,236
Europe & South Africa		197,552		173,477		6,043			21,124			17,041			11,846			23,084			32,970
Asia Pacific		255,415		197,257		18,563			10,332			21,256			15,609			39,819			25,941
Corporate and Other		24,553		16,040		(6,874	)		(20,437	)
Corporate & Other												(3,277	)		(14,159	)		(10,151	)		(34,596	)

Total	$	1,360,267	$	1,354,649	$	56,688		$	119,230		$	170,964		$	123,713		$	227,652		$	242,943

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 acurrently has no such other material ~~adverse effect on its consolidated financial position.~~litigation. However, it is possible that an adverse outcome on any particular arbitration or litigation situation could ~~from time to time,~~ have a material adverse effect on the Company’s consolidated net income in a particular reporting period.

The Company has obtained letters of credit, issued by banks, in favor of various affiliated and unaffiliated insurance companies from which the Company assumes business. These letters of credit represent guarantees of performance under the reinsurance agreements and allow ceding companies to take statutory reserve credits. At ~~March 31,~~June 30, 2008 and December 31, 2007, there were approximately ~~$24.0~~$23.9 million and $22.6 million, respectively, of outstanding bank letters of credit in favor of third parties. Additionally, the Company utilizes letters of credit to secure reserve credits when it retrocedes business to its offshore subsidiaries, including RGA Americas Reinsurance Company, Ltd., and RGA Reinsurance Company (Barbados) ~~Ltd. and RGA Worldwide Reinsurance Company,~~ Ltd. The Company cedes business to its offshore affiliates to help reduce the amount of regulatory capital required in certain jurisdictions, such as the U.S. and the United Kingdom. The capital required to support the business in the offshore affiliates reflects more realistic expectations than the original jurisdiction of the business, where capital requirements are often considered to be quite conservative. As of ~~March 31,~~June 30, 2008 and December 31, 2007, ~~$411.6~~$480.4 million and $459.6 million, respectively, in letters of credit from various banks were outstanding between the various subsidiaries of the Company. The Company maintains a syndicated revolving credit facility with an overall capacity of $750.0 million, which is scheduled to mature in September 2012. The Company may borrow cash and may obtain letters of credit in multiple currencies under this facility. As of ~~March 31,~~June 30, 2008, the Company had ~~$358.0~~$426.6 million in issued, but undrawn, letters of credit under this facility, which is included in the total above. Applicable letter of credit fees and fees payable for the credit facility depend upon the Company’s senior unsecured long-term debt rating. Fees associated with the Company’s other letters of credit are not fixed for periods in excess of one year and are based on the Company’s ratings and the general availability of these instruments in the marketplace.

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 an office lease ~~obligation,~~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. Liabilities supported by the treaty guarantees, before consideration for any legally offsetting amounts due from the guaranteed party, totaled ~~$324.9~~$337.1 million and $325.1 million as of ~~March 31,~~June 30, 2008 and December 31, 2007, 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, 2008, RGA’s exposure related to these guarantees was ~~$158.9~~$159.0 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.

8. 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
2008 2007 2008 2007

Determination of net periodic benefit cost:

Service cost $ 819 $ 799 $ 158 $ 206
Interest cost 586 592 145 190
Expected rate of return on plan assets (469 ) (455 ) — —
Amortization of prior service cost 7 95 — —
Amortization of prior actuarial loss 72 113 35 84

Net periodic benefit cost $ 1,015 $ 1,144 $ 338 $ 480

Three months ended Six months ended
June 30, 2008 June 30, 2007 June 30, 2008 June 30, 2007

Net periodic pension benefit cost:

Service cost $ 661 $ 472 $ 1,480 $ 1,271
Interest cost 585 258 1,171 850
Expected return on plan assets (469 ) (483 ) (938 ) (938 )
Amortization of prior service cost 147 79 154 174
Amortization of prior actuarial (gain) loss 92 (44 ) 164 69

Net periodic pension benefit cost $ 1,016 $ 282 $ 2,031 $ 1,426

Net periodic other benefits cost:

Service cost $ 157 $ (63 ) $ 315 $ 143
Interest cost 145 79 290 269
Expected return on plan assets — — — —
Amortization of prior service cost — 12 — 12
Amortization of prior actuarial (gain) loss 36 (2 ) 71 82

Net periodic other benefits cost $ 338 $ 26 $ 676 $ 506

The Company made no pension contributions of $4.0 million during the ~~first~~second quarter of 2008 and expects this to ~~make total contributions of approximately $2.0 million in 2008.~~be the only contribution for the year.

9. Equity Based Compensation

Equity compensation expense was ~~$5.4~~$2.4 million and ~~$6.6~~$2.9 million in the second quarter of 2008 and 2007, respectively, and $7.8 million and $9.5 million in the first ~~quarter~~six months of 2008 and 2007, respectively. In the first quarter of 2008, the Company granted 0.4 million incentive stock options at $56.03 weighted average per share and 0.2 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, 2008, ~~1.8~~1.7 million share options at ~~$32.41~~$32.43 weighted average per share ~~were~~ vested and exercisable with a remaining weighted average exercise period of ~~4.1~~4.0 years. As of ~~March 31,~~June 30, 2008, the total compensation cost of non-vested awards not yet recognized in the financial statements was ~~$23.9~~$20.9 million. It is estimated that these costs will vest over a weighted average period of ~~2.1~~2.0 years.

10. New Accounting Standards

In March 2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities — An Amendment of FASB Statement No. 133” (“SFAS 161”). SFAS 161 requires enhanced qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative agreements. SFAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. The Company is currently evaluating the impact of SFAS 161 on its condensed consolidated financial statements.

In February 2008, the FASB issued Staff Position (“FSP”) No. FAS 140-3, “Accounting for Transfers of Financial Assets and Repurchase Financing Transactions” (“FSP 140-3”). FSP 140-3 provides guidance for evaluating whether to account for a transfer of a financial asset and repurchase financing as a single transaction or as two separate transactions. FSP 140-3 is effective prospectively for financial statements issued for fiscal years beginning after November 15, 2008. The Company is currently evaluating the impact of FSP 140-3 on its condensed consolidated financial statements.

reporting standards surrounding noncontrolling interest, or minority interests, which are the portions of equity in a subsidiary not attributable, directly or indirectly, to a parent. The pronouncements are effective for fiscal years beginning on or after December 15, 2008 and apply prospectively to business combinations. Presentation and disclosure requirements related to noncontrolling interests must be retrospectively applied. The Company is currently evaluating the impact of SFAS 141(r) on its accounting for future acquisitions and the impact of SFAS 160 on its 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 did not elect to apply the fair value option available under SFAS 159 for any of its eligible financial instruments.

1317

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 2007 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 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 $8.0 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 privatized pension business in run-off, investment income and expense associated with the Company’s collateral finance facility 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 and 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 ~~decreased $62.5~~increased $47.3 million, or ~~52.5%~~38.2%, inand decreased $15.3 million, or 6.3%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This~~The increase for the second quarter was primarily due to increased premiums related to growth in assumed insurance in force. The decrease in income for the six months can be largely attributed to unfavorable

mortality experience in the U.S. and Europe & South Africa segments and an unrealized loss due to an unfavorable change in the value of embedded derivatives within the U.S. segment due to the impact of widening credit spreads in the U.S. debt markets. Offsetting these negative income items for the first six months were increases in premium levels in all segments. Favorable foreign currency exchange fluctuations resulted in an increase to income from continuing operations before income taxes totaling approximately $6.2 million and $13.2 million for the second quarter and first six months of 2008, respectively.

The unrealized loss due to an unfavorable change in value of embedded derivatives is primarily related to reinsurance treaties written on a modified coinsurance or funds withheld basis and subject to the provisions of Statement of Financial Accounting Standards (“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”). Additionally, changes in risk free rates used in the present value calculations of embedded derivatives associated with equity-indexed annuity treaties (“EIAs”) negatively affected income before income ~~taxes.~~taxes in the first six months of 2008. Unfavorable changes in these two types of embedded derivatives, after adjustment for deferred acquisition costs and retrocession, resulted in a decrease in consolidated income from continuing operations before income taxes of approximately ~~$47.5~~$45.9 million infor the ~~first quarter of~~six months ended June 30, 2008, as compared to the same period in 2007. These fluctuations do not affect current cash flows, crediting rates or spread performance on the underlying treaties. Therefore, Company management believes it is helpful to distinguish between the effects of changes in these embedded derivatives 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 the embedded derivatives to be immaterial.

Offsetting these negative income items in the first quarter was an increase in premium levels in all segments and favorable mortality experience in the Canada and Asia Pacific segments. Favorable foreign currency exchange fluctuations resulted in an increase to income from continuing operations before income taxes totaling approximately $7.1 million for the first quarter of 2008.

Consolidated net premiums increased ~~$172.6~~$150.9 million, or ~~15.3%~~12.5%, inand $323.5 million, or 13.9%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007, due to growth in life reinsurance in force. Consolidated assumed insurance in force increased to $2.2 trillion for the quarter ended ~~March 31,~~June 30, 2008 from $2.0 trillion for quarter ended ~~March 31,~~June 30, 2007. ~~Assumed~~The Company added new business production, ~~for~~measured by face amount of insurance in force, of $71.6 billion and $81.7 billion during the second quarter, and $148.0 billion and $143.5 billion during the first ~~quarter~~six months, of 2008 ~~totaled $76.4 billion compared~~and 2007, respectively. Management believes industry consolidation and the established practice of reinsuring mortality risks should continue to ~~$61.8 billion in the same period in 2007.~~provide opportunities for growth, albeit at rates less than historically experienced. Foreign currency fluctuations favorably affected net premiums by approximately ~~$46.5~~$20.6 million inand $67.0 million for the second quarter and first ~~quarter~~six months of ~~2008.~~2008, respectively.

Consolidated investment income, net of related expenses, decreased ~~$16.2~~$20.0 million, or ~~7.5% during~~7.3%, and $36.3 million, or 7.4%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same periods in 2007, primarily due to market value changes related to the Company’s funds withheld at interest investment related to the reinsurance of certain equity indexed annuity products, which are substantially offset by a corresponding change in interest credited to policyholder account balances resulting in a negligible effect on net income. ~~Also offsetting~~Offsetting the decrease in investment income was a larger invested asset base and a higher effective investment portfolio yield. Invested assets as of ~~March 31,~~June 30, 2008 totaled ~~$16.3~~$16.8 billion, ~~a 7.3%~~an 8.5% increase over ~~March 31,~~June 30, 2007. The average yield earned on investments, excluding funds withheld, increased to 6.07% in the second quarter of 2008 from 5.90% for the second quarter of 2007. The average yield earned on investments, excluding funds withheld, increased to 6.06% infor the first ~~quarter~~six months of 2008 from ~~5.93%~~5.92% for the first ~~quarter~~six months of 2007. The average yield will vary from quarter to quarter and year to year depending on a number of variables, including the prevailing interest rate and credit spread environment, changes in the mix of the underlying investments, and the timing of dividends and distributions on certain investments.

Investment related losses, net decreased $7.1 million and increased ~~$149.6~~$142.5 million infor the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This~~The large increase for the first six months is primarily due to ~~a $148.5~~an increase of $155.7 million in the loss inof the aforementioned embedded derivatives related to Issue B36. Investment income and investment related gains and losses are allocated to the operating 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%~~35.2% and 36.1% for the ~~first~~second quarter of 2008 and ~~2007.~~2007, respectively, and 35.3% and 35.8% for the first six months of 2008 and 2007, respectively. These effective tax rates

were affected by the ongoing application of FASB issued Interpretation No. 48, “Accounting for Uncertainty in Income Taxes — an interpretation of FASB Statement No. 109”.

Critical Accounting Policies

The Company’s accounting policies are described in Note 2 in the 2007 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 investments, derivatives and investment impairments, if any; accounting for income taxes; 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.

Assets and liabilities measured at fair value on a recurring basis are summarized below(dollars in thousands).

June 30, 2008
Fair Value Measurements Using:
Total Level 1 Level 2 Level 3

Assets:
Fixed maturity securities – available-for-sale $ 9,667,961 $ 121,457 $ 8,044,131 $ 1,502,373
Funds withheld at interest – embedded derivatives (245,070 ) — — (245,070 )
Short-term investments 1,927 — 1,927 —
Other invested assets – equity securities 190,365 138,275 40,751 11,339
Other invested assets – derivatives 4,853 — 4,853 —
Reinsurance ceded receivable – embedded derivatives 81,163 — — 81,163

Total $ 9,701,199 $ 259,732 $ 8,091,662 $ 1,349,805

Liabilities:
Interest sensitive contract liabilities – embedded derivatives $ (588,870 ) $ — $ — $ (588,870 )
Other liabilities – derivatives (4,491 ) — (4,491 ) —

Total $ (593,361 ) $ — $ (4,491 ) $ (588,870 )

The tables below present reconciliations for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2008(dollars in thousands).

Total Fair Value Measurements for the three months ended June 30, 2008

Total gains/losses
(realized/unrealized) included in:

Purchases, Transfers
Balance Other issuances in and/or Balance
April 1, comprehensive and out of June 30,
2008 Earnings, net loss disposals Level 3 2008

Assets:
Fixed maturity securities available-for-sale $ 1,509,166 $ (442 ) $ (41,661 ) $ 55,804 $ (20,494 ) $ 1,502,373
Funds withheld at interest – embedded derivatives (233,618 ) (11,452 ) — — — (245,070 )
Other invested assets – equity securities 20,202 1 (1,241 ) 7,000 (14,623 ) 11,339
Reinsurance ceded receivable – embedded derivatives 78,216 (1,459 ) — 4,406 — 81,163

Total $ 1,373,966 $ (13,352 ) $ (42,902 ) $ 67,210 $ (35,117 ) $ 1,349,805

Liabilities:
Interest sensitive contract liabilities – embedded derivatives $ (585,572 ) $ 5,983 $ — $ (9,281 ) $ — $ (588,870 )

Total $ (585,572 ) $ 5,983 $ — $ (9,281 ) $ — $ (588,870 )

Total Fair Value Measurements for the six months ended June 30, 2008

Total gains/losses
(realized/unrealized) included in:

Purchases, Transfers
Balance Other issuances in and/or Balance
January 1, comprehensive and out of June 30,
2008 Earnings, net loss disposals Level 3 2008

Assets:
Fixed maturity securities available-for-sale $ 1,500,054 $ (7,552 ) $ (77,782 ) $ 127,087 $ (39,434 ) $ 1,502,373
Funds withheld at interest — embedded derivatives (85,090 ) (159,980 ) — — — (245,070 )
Other invested assets — equity securities 13,950 2 (1,720 ) 13,730 (14,623 ) 11,339
Reinsurance ceded receivable — embedded derivatives 68,298 4,586 — 8,279 — 81,163

Total $ 1,497,212 $ (162,944 ) $ (79,502 ) $ 149,096 $ (54,057 ) $ 1,349,805

Liabilities:
Interest sensitive contract liabilities — embedded derivatives $ (531,160 ) $ (37,695 ) $ — $ (20,015 ) $ — $ (588,870 )

Total $ (531,160 ) $ (37,695 ) $ — $ (20,015 ) $ — $ (588,870 )

Level 3 assets were 13.9% of total assets measured at fair value and Level 3 liabilities were 99.2% of total liabilities measured at fair value as of June 30, 2008. Transfers in and out of Level 3 for the period ended June 30, 2008 were not significant.

Asset-backed securities (“ABS”) represented approximately 21.6% of Level 3 fixed maturity securities available-for-sale and 24.1% of total Level 3 assets as of June 30, 2008. ABS primarily represents sub-prime and Alt-A securities which are classified as Level 3 due to the lack of liquidity in the market along with illiquid bank loan collateralized debt obligations. While the fair value of these investments, as well as others within the Company’s portfolio of fixed maturity securities available-for-sale, has declined in recent quarters due to increased credit spreads in the financial markets, the Company believes the investment fundamentals remain sound, and the ultimate value that will be realized from these investments is greater than that reflected by their current fair value.

See Note 5 — “Fair Value Disclosures” in the Notes to Condensed Consolidated Financial Statements and the discussion of “Investments” in the “Liquidity and Capital Resources” section of Management’s Discussion and Analysis for additional information on the Company’s assets and liabilities recorded at fair value as of June 30, 2008.

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.

Income taxes represent the net amount of income taxes that the Company expects to pay to or receive from various taxing jurisdictions in connection with its operations. The Company provides for federal, state and foreign income taxes currently payable, as well as those deferred due to temporary differences between the financial reporting and tax bases of assets and liabilities. The Company’s accounting for income taxes represents management’s best estimate of various events and transactions.

Deferred tax assets and liabilities resulting from temporary differences between the financial reporting and tax bases of assets and liabilities are measured at the balance sheet date using enacted tax rates expected to apply to taxable income in the years the temporary differences are expected to reverse. The realization of deferred tax assets depends upon the existence of sufficient taxable income within the carryback or carryforward periods under the tax law in the applicable tax jurisdiction.

such allowances. When making such determination, consideration is given to, among other things, the following:

~~(i)~~		~~future taxable income exclusive of reversing temporary differences and carryforwards;~~

~~(ii)~~		~~future reversals of existing taxable temporary differences;~~

~~(iii)~~		~~taxable income in prior carryback years; and~~

~~(iv)~~		(i) future taxable income exclusive of reversing temporary differences and carryforwards; (ii) future reversals of existing taxable temporary differences; (iii) taxable income in prior carryback years; and (iv) tax planning strategies.

The Company may be required to change its provision for income taxes in certain circumstances. Examples of such circumstances include when the ultimate deductibility of certain items is challenged by taxing authorities or when estimates used in determining valuation allowances on deferred tax assets significantly change or when receipt of new information indicates the need for adjustment in valuation allowances. Additionally, future events such as changes in tax legislation could have an impact on the provision for income tax and the effective tax rate. Any such changes could significantly affect the amounts reported in the condensed consolidated financial statements in the period these changes occur.

In accordance with SFAS No. 157, “Fair Value Measurements” (“SFAS 157”), valuation techniques used for assets and embedded derivative liabilities accounted for at fair value are generally categorized into three types:

~~Market Approach~~. Market approach valuation techniques use prices and other relevant information from market transactions involving identical or comparable assets or liabilities. Valuation techniques consistent with the market approach include comparables and matrix pricing. Comparables use market multiples, which might lie in ranges with a different multiple for each comparable. The selection of where within the range the appropriate multiple falls requires judgment, considering both quantitative and qualitative factors specific to the measurement. Matrix pricing is a mathematical technique used principally to value certain securities without relying exclusively on quoted prices for the specific securities but comparing the securities to benchmark or comparable securities.

~~Income Approach~~. Income approach valuation techniques convert future amounts, such as cash flows or earnings, to a single present amount, or a discounted amount. These techniques rely on current expectations of future amounts. Examples of income approach valuation techniques include present value techniques, option-pricing models and binomial or lattice models that incorporate present value techniques.

~~Cost Approach~~. Cost approach valuation techniques are based upon the amount that, at present, would be required to replace the service capacity of an asset, or the current replacement cost. That is, from the perspective of a market participant (seller), the price that would be received for the asset is determined based on the cost to a market participant (buyer) to acquire or construct a substitute asset of comparable utility.

The three approaches described within SFAS 157 are consistent with generally accepted valuation methodologies. While all three approaches are not applicable to all assets or liabilities accounted for at fair value, where appropriate and possible, one or more valuation techniques may be used. The selection of the valuation method(s) to apply considers the definition of an exit price and the nature of the asset or liability being valued and significant expertise and judgment is required. For assets and liabilities accounted for at fair value, valuation techniques are generally a combination of the market and income approaches. For the quarter ended March 31, 2008, the application of valuation techniques applied to similar assets and liabilities has been consistent. Changes in interest rates, including credit spreads and the Company’s own credit risk, can have a significant impact on the fair value calculations. Additionally, changes in the actuarial assumptions regarding policyholder behavior may result in significant fluctuations in embedded derivative liabilities associated with equity-indexed annuity reinsurance treaties.

Level 3 assets were 14.6% of total assets measured at fair value and Level 3 liabilities were 99.9% of total liabilities measured at fair value as of March 31, 2008. Transfers in and out of Level 3 for the period ended March 31, 2008 were not significant. Please refer to Note 5 – “Fair Value Disclosures” in the Notes to Condensed Consolidated Financial Statements for additional information on the Company’s assets and liabilities recorded at fair value as of March 31, 2008.

The Company at times is a party to various litigation and arbitrations. The Company cannot predict or determine the ultimate outcome of any pending litigation or arbitrations or even 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 on any particular arbitration or litigation situation could ~~from time to time,~~ have a material adverse effect on the Company’s consolidated net income in a particular reporting period.

Further discussion and analysis of the results for 2008 compared to 2007 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, 2008 (dollars in thousands)


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

Revenues:
Net premiums	$	725,393		$	1,663		$	—		$	727,056		$	752,831		$	1,592		$	—		$	754,423
Investment income, net of related expenses		97,431			25,031			40			122,502			97,462			80,920			356			178,738
Investment related losses, net		(2,508	)		(149,554	)		(1	)		(152,063	)		(637	)		(9,044	)		(2	)		(9,683	)
Other revenues		60			11,495			2,744			14,299			552			14,211			4,314			19,077

Total revenues		820,376			(111,365	)		2,783			711,794			850,208			87,679			4,668			942,555

Benefits and expenses:
Claims and other policy benefits		651,850			185			—			652,035			624,310			865			—			625,175
Interest credited		14,790			58,968			—			73,758			14,924			47,995			—			62,919
Policy acquisition costs and other insurance expenses		86,050			(131,750	)		198			(45,502	)		103,231			27,086			250			130,567
Other operating expenses		13,238			2,334			646			16,218			12,121			1,840			767			14,728

Total benefits and expenses		765,928			(70,263	)		844			696,509			754,586			77,786			1,017			833,389

Income (loss) before income taxes	$	54,448		$	(41,102	)	$	1,939		$	15,285
Income before income taxes													$	95,622		$	9,893		$	3,651		$	109,166

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


				Non-Traditional				Total					Non-Traditional						Total
				Asset-		Financial		U.S.					Asset-			Financial			U.S.
	Traditional			Intensive		Reinsurance		Operations		Traditional			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 gains (losses), net		(338	)		2,055		—		1,717
Investment related losses, net											(4,497	)		(8,270	)		(7	)		(12,774	)
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			22,293		2,194		123,867		101,807			16,750			2,001			120,558
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

~~with EIAs and changes in credit~~market spreads associated with embedded derivatives subject to Issue ~~B36. Adverse mortality contributed approximately $50.0~~B36 of $33.3 million ofand the ~~unfavorable variance. The~~ impact of changes in risk free rates used in the present value calculations of embedded derivatives associated with EIAs and changes in credit spreads associated with embedded derivatives subject to Issue B36 (described below in the Asset-Intensive sub-segment) had a significant impact on income, contributing a $46.8 million loss in the current quarter compared to income of ~~$0.7 million for the same period in 2007.~~$12.6 million. Offsetting these negative income items was overall growth in total business in force as evidenced by the increase in net ~~premiums quarter over quarter, increased investment income and certain favorable reserve adjustments recognized in the Traditional sub-segment.~~premiums.

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 beinvolve either facultative or automatic agreements. ~~During the first quarter of 2008, this~~This sub-segment added new business production, ~~of $34.7 billion,~~ measured by face amount of insurance in force, ~~compared to $40.2~~of $35.5 billion asand $44.1 billion during the second quarter, and $70.2 billion and $84.4 billion during the first six months, of ~~the same period in 2007.~~2008 and 2007, respectively. Management believes industry consolidation and the established practice of reinsuring mortality risks should continue to provide opportunities for ~~growth.~~growth, albeit at rates less than historically experienced.

Income before income taxes for the U.S. Traditional sub-segment ~~decreased $31.6~~increased by $16.5 million, or ~~36.7%~~20.9%, inand decreased by $15.0 million, or 9.1% for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This~~Stronger premiums and higher investment income were the primary contributors to the increase for the second quarter of 2008 compared to 2007. The six months decrease in 2008 compared to 2007 was primarily due to adverse mortality experience in the first quarter of 2008.

Net premiums for the U.S. Traditional sub-segment ~~increased $56.0~~grew $34.1 million, or ~~8.4%~~4.7%, inand $90.1 million, or 6.5% for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This increase~~These increases in net premiums ~~was~~were driven primarily by the growth of total U.S. Traditional business in force, which totaled ~~just over $1.2~~$1.3 trillion of face amount as of ~~March 31,~~June 30, 2008. This represents a ~~5.9%~~4.7% increase over the amount in force on ~~March 31,~~June 30, 2007.

Net investment income increased ~~$12.5~~$10.3 million, or ~~14.7%~~11.8%, inand $22.8 million, or 13.3%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This increase~~These increases can be attributed to growth in the invested asset base and increased portfolio return. 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.

Claims and other policy benefits as a percentage of net premiums (“loss ratios”) were ~~89.9% in~~82.9% and 82.7% for the ~~first~~second quarter of 2008 and 2007, respectively, and 86.3% and 81.9% for the six months ended June 30, 2008 and 2007, respectively. The second quarter 2008 loss ratio increased slightly when compared to ~~81.1% in 2007. The higher~~the prior year; however, the loss ratio infor the first six months of 2008 isincreased substantially compared to the prior year due to very unfavorable mortality experience ~~compared to~~during the ~~prior year.~~first quarter of 2008. Increases in the total claim count and the level of large claims were major contributors to claims being approximately $50.0 million higher than ~~expected.~~expected in the first quarter of 2008. Although reasonably ~~predicable~~predictable over a period of years, death claims ~~are~~can be volatile over shorter periods. Management has completed an extensive review of the level and mix of claims and views recent experience as normal volatility that is inherent in the business.

Interest credited expense increased ~~$0.5~~$0.3 million, or ~~3.6%~~2.4%, inand $0.9 million, or 3.0%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~The increase is~~These increases are the result of one treaty that had a slight increase in its asset base with a credited loan rate remaining constant at 5.6% for 2007 and 2008. Interest credited in this case relates to amounts credited on cash value products which also 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.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were ~~11.9% in~~13.7% and 14.2% for the ~~first~~second quarter of 2008 ~~compared to 14.8% in 2007.~~and 2007, respectively, and 12.8% and 14.5% for the six months ended June 30, 2008 and 2007, respectively. Overall, while these ratios are expected to remain in a predictable range, they may fluctuate

Asset-Intensive Reinsurance

The U.S. Asset-Intensive sub-segment assumes investment risk within underlying annuities and corporate-owned life insurance policies. Most of these agreements are coinsurance, coinsurance with funds withheld or modified coinsurance of non-mortality risks whereby the Company recognizes profits or losses primarily from the spread between the investment income earned and the interest credited on the underlying deposit liabilities.

~~This sub-segment reported a loss~~Income before income taxes ~~of $41.1~~for this sub-segment increased by $5.8 million, and decreased by $39.8 million for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to ~~income of $4.5 million~~the same periods in 2007. The decrease for the ~~first quarter of 2007. The unrealized loss due~~six month period can be attributed to anthe unfavorable change in the value of embedded derivatives, after adjustment for deferred acquisition costs under Issue ~~B36;~~B36, combined with ~~the negative impact of changes in risk free rates used~~an increase in the present value calculations of embedded derivatives associated with ~~EIAs,~~EIAs. Collectively, these items contributed ~~$46.8~~$46.7 million to the loss induring the first six months of 2008 ~~and $0.7~~compared to $0.9 million toduring the ~~income in~~first six months of 2007.

In accordance with the provisions of Issue B36, the Company recorded a gross change in value of embedded derivatives of ~~$(148.5)~~$(160.0) million for the first ~~quarter~~six months of 2008, within investment related losses, net. The amount represents a non-cash, unrealized change in value and was somewhat offset by ~~$(115.9) million~~a reduction in policy acquisition costs and other insurance expenses associated with an adjustment of related deferred acquisition costs totaling $(125.9) million, for a total net contribution of ~~$32.6~~$34.1 million to the loss before income taxes. Significant fluctuations may occur as the fair value of the embedded derivatives is tied primarily to the movements in ~~credit~~market spreads. During the ~~quarter, management estimates the~~first six months, weighted average asset credit spreads widened by approximately ~~0.71 %. This was somewhat offset by a decrease in risk free rate of approximately 0.44 %.~~0.75%. Additionally, the Company uses risk free rates, in accordance with FAS 157, to discount the fair value of estimated future equity option purchases associated with its reinsurance of EIAs (a component of the embedded derivative), which increased the fair value of the embedded derivative liability. The impact from the change in risk free rates over the first six months is anthe primary driver for the increase in the gross embedded liability of ~~$64.5~~$55.2 million, which was recorded as expense within interest credited. This increase was partially offset by ~~$(50.4) million of~~ related deferred acquisition costs and retrocession of $(42.6) million for a net contribution of ~~$14.1~~$12.6 million to the loss before income taxes. These fluctuations do not affect current cash flows, crediting rates or spread performance on the underlying treaties. Therefore, Company management believes it is helpful to distinguish between the effects of changes in these embedded derivatives 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 the impact of changes in risk free rates used in the present value calculations of embedded derivatives associated with EIAs and Issue B36 to be immaterial.

Excluding the impact of changes in risk free rates and ~~credit~~market spreads used in the present value calculations of embedded derivatives associated with EIAs and Issue B36, income before income taxes increased ~~$1.9~~$4.1 million, or ~~52.4%~~72.7%, inand $6.1 million, or 64.7%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~The increase~~These increases can be attributed to continued growth in business and improved mortality experience in a single universal life treaty for the comparable periods. These gains were partially offset by poor performance in equity markets and the widening of credit spreads.

Total revenues, which are comprised primarily of investment income and investment related losses, net, decreased ~~$190.4~~$32.7 million inand $223.1 million for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. The losses associated with embedded derivatives subject to Issue B36, which are included in investment related losses, net, represented ~~$151.4~~$4.3 million and $155.7 million of the ~~decrease.~~decreases for the second quarter and six month periods, respectively. Excluding the losses associated with embedded derivatives subject to Issue B36, revenue decreased ~~$39.0~~$28.4 million and $67.4 million for the second quarter and six month periods, respectively,

primarily due to a drop in investment income related to option income on a funds withheld treaty. This decrease is partially offset by a corresponding decrease in interest credited.

The average invested asset base supporting this sub-segment grew to ~~$4.8~~$4.9 billion in the ~~first~~second quarter of 2008 from ~~$4.6~~$4.7 billion in the ~~first~~second quarter of 2007. The growth in the asset base is ~~primarily~~ driven by new business written on ~~one~~ existing equity indexed and variable annuity ~~treaty.~~treaties. In addition, a new fixed annuity transaction was executed in the second quarter of 2008, adding approximately $448.7 million to the asset base of this sub-segment. Invested assets outstanding were ~~$4.7~~$5.2 billion as of ~~March 31,~~June 30, 2008 ~~and~~compared to $4.7 billion in 2007. As of ~~March 31,~~June 30, 2008, $3.6 billion of the invested ~~asset base~~assets were funds withheld at interest, of which 90.7% is ~~slightly lower than the average as the outstanding balance reflects a drop in option value since the end of 2007.~~associated with one client. As of ~~March 31, 2008,~~June 30, 2007, $3.4 billion of the invested assets were funds withheld at interest, of which ~~90.8% is associated with one client. As of March 31, 2007, $3.2 billion of the invested assets were funds withheld balance of which 90.7%~~91.5% of the balance was associated with one client.

Total benefits and expenses, which are comprised primarily of interest credited and policy acquisition costs, decreased ~~$144.9~~$38.4 million inand $183.3 million for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. Contributing to ~~the decrease~~these decreases was a ~~decrease~~reduction in expenses related to embedded derivatives subject to Issue B36 of ~~$118.0~~$4.4 million ~~partially offset by an increase in the expenses related to the impact of changes in risk free rates used in the present value calculations of embedded derivatives associated~~and $122.4 million, coupled with EIAs of $14.1 million. Excluding both the impact of changes in risk free rates and credit spreads used in the present value calculations of embedded derivatives associated with EIAs and embedded derivatives subject to Issue B36,

~~expenses decreased $41.0 million. This decrease is primarily due to a~~ decrease in interest ~~credited.~~credited of $50.3 million and $37.5 million for the three and six month periods, respectively. As mentioned above, a large part of ~~this~~the decrease in interest credited relates to market value changes in certain equity indexed annuity products and is offset in investment income.

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~~U.S. segment and retroceded to other insurance companies or brokered business in which the ~~company assumes little~~Company does not participate in the assumption of risk. The fees earned from financial reinsurance contracts are reflected in other revenues, and the fees paid to retrocessionaires are reflected in policy acquisition costs and other insurance expenses. Fees earned on brokered business are reflected in other revenues.

Income before income taxes ~~decreased $0.8~~increased by $0.6 million, or ~~28.3%~~21.5%, inand decreased by $0.1 million, or 2.1%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. At ~~March 31,~~June 30, 2008 and 2007, the amount of reinsurance provided, as measured by pre-tax statutory surplus, was $0.5 billion and $1.1 billion, respectively. The decrease in reinsurance provided is primarily the result of the recapture of one treaty which totaled ~~$0.5~~$0.6 billion at the end of ~~first~~the second quarter 2007. The pre-tax statutory surplus amounts indicated include 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 and morbidity risk management, and is primarily engaged in traditional individual life reinsurance, as well as creditor, critical illness, and group life and health 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.

For the three months ended For the six months ended
(dollars in thousands) June 30, 2008 June 30, 2007 June 30, 2008 June 30, 2007

Revenues:

Net premiums $ 139,530 $ 122,580 $ 278,522 $ 222,072
Investment income, net of related expenses 35,692 32,363 71,725 58,795
Investment related gains (losses), net 4,004 1,648 (81 ) 4,432
Other revenues 13,204 93 13,217 179

Total revenues 192,430 156,684 363,383 285,478

Net investment income increased ~~$9.6~~$3.3 million, or ~~36.3%~~10.3%, inand $12.9, or 22.0%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same period in 2007. A stronger Canadian dollar resulted in an increase in net investment income of approximately ~~$5.2~~$2.9 million and $8.2 million in the second quarter and first ~~quarter~~six months of ~~2008.~~2008, 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 the segment 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.

Other revenues increased by $13.1 million, and $13.0 million, for the three and six months ended June 30, 2008, as compared to the same periods in 2007. The increases in 2008 were primarily the result of a fee earned of $12.9 million from the recapture of a previously retroceded block of creditor business.

Loss ratios for this segment were ~~82.9% in~~96.1% and 86.2% for the ~~first~~second quarter of 2008 ~~compared to 91.6% in 2007.~~and 2007, respectively, and 89.6% and 88.6% for the six months ended June 30, 2008 and 2007, respectively. The loss ratios on creditor reinsurance business are normally lower than traditional reinsurance, while allowances are normally higher as a percentage of premiums. Loss ratios for creditor business were ~~40.7% in~~90.4% and 46.5% for the ~~first~~second quarter of 2008 ~~compared to 49.7%~~and 2007, respectively, and 64.1% and 48.0% for the six months ended June 30, 2008 and 2007, respectively. The increases in ~~2007.~~2008 were primarily the result of the release of retroceded reserves of $10.4 million from the aforementioned recapture. Excluding creditor business and the recapture, the loss ~~ratio~~ratios for this segment ~~was 93.2% in~~were 97.3% and 94.8% for the ~~first~~second quarter of 2008 ~~compared to 100.9% in~~and 2007, respectively, and 95.3% and 97.5% for the six months ended June 30, 2008 and 2007. The lower loss ratio in 2008 is 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 65.9%~~were 76.6% and 68.2% in the ~~first~~second quarter of 2008 ~~compared to 72.4% in 2007.~~and 2007, respectively, and 71.2% and 70.1% for the six months ended June 30, 2008 and 2007, respectively.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were ~~19.0% in~~18.3% and 17.4% for the ~~first~~second quarter of 2008 ~~compared to 18.6% in 2007.~~and 2007, respectively, and 18.7% and 17.9% for the six months ended June 30, 2008 and 2007, respectively. Policy acquisition costs and other insurance expenses as a percentage of net premiums for creditor business were ~~49.3% in~~45.9% and 46.8% for the ~~first~~second quarter of 2008 ~~compared to 44.1% in 2007.~~and 2007, respectively, and 47.7% and 45.6% for the six months ended June 30, 2008 and 2007, respectively. Excluding creditor business, policy acquisition costs and other insurance expenses as a percentage of net premiums were ~~11.6% in~~12.5% and 11.0% for the ~~first~~second quarter of 2008 ~~compared to 12.9% in 2007.~~and 2007, respectively, and 12.1% and 11.9% for the six months ended June 30, 2008 and 2007, respectively. Overall, while these ratios are expected to remain in a predictable range, they may fluctuate from period to period due to varying allowance levels, 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 ~~$1.5~~$0.6 million, or ~~37.9%~~11.6%, inand $2.1 million, or 22.8%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. A stronger Canadian dollar resulted in an increase in other operating expenses of ~~$0.7~~$0.4 million and $1.1 million in ~~2008.~~the second quarter and first six months of 2008, respectively. Other operating expenses as a percentage of net premiums were ~~3.9% in~~4.2% and 4.3% for the ~~first~~second quarter of 2008 ~~compared to 4.0% in 2007.~~and 2007, respectively, and 4.1% and 4.2% for the six months ended June 30, 2008 and 2007, respectively.

EUROPE & SOUTH AFRICA OPERATIONS

The Europe & South Africa segment has operations in France, Germany, 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)~~


	2008		2007			For the three months ended						For the six months ended
(dollars in thousands)						June 30, 2008			June 30, 2007			June 30, 2008		June 30, 2007

Revenues:
Net premiums	$	189,196	$	167,796		$	185,490		$	164,796		$	374,686	$	332,592
Investment income, net of related expenses		7,551		5,774			8,778			7,103			16,329		12,877
Investment related gains (losses), net		745		(224	)		(131	)		(630	)		614		(854	)
Other revenues		60		131			68			(27	)		128		104

Total revenues		197,552		173,477			194,205			171,242			391,757		344,719

Benefits and expenses:
Claims and other policy benefits		158,535		114,154			144,460			128,828			302,995		242,982
Interest credited		—		452			—			564			—		1,016
Policy acquisition costs and other insurance expenses		17,230		26,060			16,026			17,129			33,256		43,189
Other operating expenses		15,744		11,687			16,678			12,875			32,422		24,562

Total benefits and expenses		191,509		152,353			177,164			159,396			368,673		311,749

Income before income taxes	$	6,043	$	21,124		$	17,041		$	11,846		$	23,084	$	32,970

Income before income taxes increased by $5.2 million, or 43.9%, and decreased by ~~$15.1~~$9.9 million, or ~~71.4%~~30.0%, infor the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. The increase for the second quarter was primarily due to an increase in net premiums as well as a decrease to policy acquisition costs and other insurance expenses partially offset by a an increase in claims and other policy benefits. The six month decrease in 2008 compared to 2007 was primarily due to adverse claims experience in the first quarter of 2008, partially offset by increased net premiums and decreased policy acquisition costs and other insurance expenses in the ~~first~~second quarter of ~~2008 compared to the same period in 2007.~~2008. Favorable foreign currency exchange fluctuations resulted in an increase to income before income taxes totaling approximately ~~$0.7~~$0.6 million and $1.3 million for the second quarter and first ~~quarter~~six months of ~~2008.~~2008, respectively.

Net premiums ~~increased $21.4~~grew $20.7 million, or ~~12.8%~~12.6%, inand $42.1 million, or 12.7%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This increase was~~These increases were primarily the result of new business from both new and existing treaties. During ~~the first quarter, several~~2008, there was a favorable foreign ~~currencies,~~currency exchange fluctuation, particularly ~~the British pound and~~from the euro ~~strengthened~~strengthening against the U.S. dollar, ~~and~~which increased net premiums by approximately ~~$4.2 million.~~ $0.6 million in the second quarter of 2008, and $4.8 million for the six months ended June 30, 2008, as compared to the same periods in 2007.

A significant portion of the net premiums for the segment, in each period presented, relates 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 this coverage totaled ~~$60.4~~$67.3 million and $57.9 million in the second quarter of 2008 and 2007, respectively, and $127.7 million and $114.9 million for the ~~first quarter of~~six months ended June 30, 2008 ~~as compared to $57.0 million for the first quarter of 2007.~~and 2007, respectively. Premium levels are significantly influenced by large transactions and reporting practices of ceding companies and therefore can fluctuate from period to period.

Net investment income increased ~~$1.8~~$1.7 million, or ~~30.8%~~23.6%, inand $3.5 million, or 26.8%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This increase was primarily due~~These increases can be attributed to ~~an increase~~growth in ~~allocated investment income.~~the invested asset base and increased portfolio return. 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 for this segment were ~~83.8% in~~77.9% and 78.2% for the ~~first~~second quarter of 2008 ~~compared to 68.0% in 2007.~~and 2007, respectively, and 80.9% and 73.1% for the six months ended June 30, 2008 and 2007, respectively. The increase in the loss ratio for the ~~first quarter of~~six months ended June 30, 2008 was primarily due to unfavorable claims experience in the UK and South Africa during the first quarter, while the prior ~~period~~year reflected favorable mortality experience.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were ~~9.1% in~~8.6% and 10.4% for the ~~first~~second quarter of 2008 ~~as compared to 15.5% in 2007.~~and 2007, respectively, and 8.9% and 13.0% for the six months ended June 30, 2008 and 2007, respectively. 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 increased ~~$4.1~~$3.8 million, or ~~34.7%~~29.5%, and $7.9 million, or 32.0%, for the three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. Other operating expenses as a percentage of net premiums totaled ~~8.3% in~~9.0% and 7.8% for the ~~first~~second quarter of 2008 ~~compared to 7.0% in 2007. This increase was~~and 2007, respectively, and 8.7% and 7.4% for the six months ended June 30, 2008 and 2007, respectively. These increases were due to higher costs associated with maintaining and supporting the segment’s increase in business over the past several years and the Company’s recent expansion into central Europe. 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)~~

For the three months ended For the six months ended
(dollars in thousands) June 30, 2008 June 30, 2007 June 30, 2008 June 30, 2007

Revenues:

Net premiums $ 277,716 $ 198,971 $ 518,651 $ 385,809
Investment income, net of related expenses 12,397 8,610 23,811 17,273
Investment related losses, net (1,510 ) (499 ) (996 ) (570 )
Other revenues 1,851 2,583 4,403 4,410

Total revenues 290,454 209,665 545,869 406,922

Benefits and expenses:

Claims and other policy benefits 225,011 151,664 418,680 302,147
Policy acquisition costs and other insurance expenses 28,386 28,173 56,467 52,787
Other operating expenses 15,801 14,219 30,903 26,047

Total benefits and expenses 269,198 194,056 506,050 380,981

Income before income taxes $ 21,256 $ 15,609 $ 39,819 $ 25,941

2008 2007

Revenues:

Net premiums $ 240,935 $ 186,838
Investment income, net of related expenses 11,414 8,663
Investment related gains (losses), net 514 (71 )
Other revenues 2,552 1,827

Total revenues 255,415 197,257

Benefits and expenses:

Claims and other policy benefits 193,669 150,483
Policy acquisition costs and other insurance expenses 28,081 24,614
Other operating expenses 15,102 11,828

Total benefits and expenses 236,852 186,925

Income before income taxes $ 18,563 $ 10,332

Income before income taxes increased by ~~$8.2~~$5.6 million, or ~~79.7%~~36.2%, inand $13.9 million, or 53.5%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. Favorable results from operations throughout the segment, primarily due to increased net premiums, contributed to the increase in income before income taxes for the second quarter and first ~~quarter~~six months of 2008, as compared to the same ~~period~~periods in 2007. Favorable foreign currency exchange fluctuations resulted in an increase to income before income taxes totaling approximately $2.2 million and $4.4 million for the second quarter and first ~~quarter~~six months of ~~2008.~~2008, respectively.

Net premiums grew ~~$54.1~~$78.7 million, or ~~29.0%~~39.6%, inand $132.8 million, or 34.4%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. This premium growth was ~~due to increased net premiums in all offices but~~ primarily the result of increases in the volume of business in Korea, Australia, ~~Japan~~ and ~~Korea.~~Taiwan. Premiums in ~~Australia~~Korea increased by ~~$22.8~~$57.4 million in the ~~first~~second quarter of 2008, and $64.4 million for the six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. Premiums in ~~Japan~~Australia increased by ~~$13.0~~$12.2 million in the ~~first~~second quarter of 2008, and $35.0 million for the six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. Premiums in ~~Korea~~Taiwan increased by ~~$7.0~~$14.2 million in the ~~first~~second quarter of 2008, and $16.7 million for the six months ended June 30, 2008, as compared to the same periods in 2007. Premium levels are significantly influenced by large transactions and reporting practices of ceding companies and can fluctuate from period to period.

Foreign currencies in certain significant markets, particularly the Australian and New Zealand dollars and the Japanese yen, have strengthened against the U.S. dollar during ~~the first three months of~~ 2008 compared to 2007. The overall effect of changes in local Asia Pacific segment currencies was an increase in net premiums of approximately ~~$22.4~~$8.6 million and $31.0 million for the second quarter and first ~~quarter~~six months of 2008, ~~when compared to the same quarter in 2007.~~respectively.

A portion of the net premiums for the segment, in each period presented, relates to 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 this coverage totaled ~~$35.5~~$71.8 million and $39.3 million in the second quarter of 2008 and 2007, respectively, and $112.3 million and $74.1 million for the first ~~quarter~~six months of 2008 ~~as compared to $34.3 million for the first quarter of 2007.~~and 2007, respectively.

Net investment income increased ~~$2.8~~$3.8 million, or ~~31.8%~~44.0%, inand $6.5 million, or 37.9%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This increase was primarily due~~These increases can be attributed to ~~an increase~~growth in ~~allocated investment income.~~the invested asset base and increased portfolio return. 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 ~~increased~~decreased by $0.7 million, or ~~39.7%~~28.3%, infor the ~~first quarter of~~three months ended June 30, 2008, as compared to the same period in 2007. Other revenue remained virtually unchanged for the first six months of 2008 and 2007. The primary source of other revenues ~~are~~is fees from financial reinsurance treaties in Japan. At ~~March 31,~~June 30, 2008 and 2007, the amount of reinsurance assumed from client companies, as measured by pre-tax statutory surplus, was $0.6 billion and $0.7 ~~billion.~~billion, respectively. 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.

Loss ratios for this segment were ~~80.4% in~~81.0% and 76.2% for the ~~first~~second quarter of 2008 ~~compared to 80.5% in 2007.~~and 2007, respectively, and 80.7% and 78.3% for the six months ended June 30, 2008 and 2007, respectively. The ~~slight decrease~~increase in the loss ~~ratio~~ratios for ~~the first quarter of~~ 2008 was largely due to ~~more~~less favorable mortality ~~experience.~~experience in 2008 compared to 2007. 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.

Policy acquisition costs and other insurance expenses as a percentage of net premiums were ~~11.7% in~~10.2% and 14.2% for the ~~first~~second quarter of 2008 ~~as compared to 13.2% in 2007.~~and 2007, respectively, and 10.9% and 13.7% for the six months ended June 30, 2008 and 2007, respectively. The ratio of policy acquisition costs and other insurance expenses as a percentage of net premiums ~~will~~should generally decline as the business ~~matures,~~matures; however, the percentage does fluctuate periodically due to timing of client company reporting and variations in the mixture of business being reinsured.

Other operating expenses increased ~~$3.3~~$1.6 million, or ~~27.7%~~11.1%, and $4.9 million, or 18.6%, for the three and six months ended June 30, 2008, as compared to the same ~~period on~~periods in 2007. ~~Operating~~Other operating expenses as a percentage of net premiums ~~remained stable at 6.3% in~~totaled 5.7% and 7.1% for the ~~first~~second quarter of 2008 and ~~2007.~~2007, respectively, and 6.0% and 6.8% for the six months ended June 30, 2008 and 2007, respectively. 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, the investment income and expense associated with the Company’s collateral finance facility and an insignificant amount of direct insurance operations in Argentina.

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

For the three months ended For the six months ended
(dollars in thousands) June 30, 2008 June 30, 2007 June 30, 2008 June 30, 2007

Revenues:

Net premiums $ 1,396 $ 948 $ 3,282 $ 1,227
Investment income, net of related expenses 19,263 22,257 41,289 44,231
Investment related gains (losses), net 241 (1,963 ) (130 ) (11,815 )
Other revenues 2,062 1,961 3,074 5,600

Total revenues 22,962 23,203 47,515 39,243

Benefits and expenses:

Claims and other policy benefits 35 113 37 28
Policy acquisition costs and other insurance expenses (11,233 ) (9,187 ) (21,206 ) (19,223 )
Other operating expenses 8,891 9,998 19,721 23,456
Interest expense 21,580 23,232 44,674 43,685
Collateral finance facility expense 6,966 13,206 14,440 25,893

Total benefits and expenses 26,239 37,362 57,666 73,839

Loss before income taxes $ (3,277 ) $ (14,159 ) $ (10,151 ) $ (34,596 )

Total revenues ~~increased $8.5~~decreased by $0.2 million, or ~~53.1%~~1.0%, inand increased $8.3 million, or 21.1%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This increase~~The decrease for the second quarter was due to a ~~$9.5~~$3.0 million decrease in net investment income largely due to lower investment returns on variable investments used to fund the Company’s collateral finance facility, somewhat offset by a $2.2 million increase in investment related gains. The increase for the six month period was due to an $11.7 million decrease in investment related losses, net, primarily due to the recognition of a $10.5 million currency translation loss in the first quarter of 2007 related to the Company’s decision to sell its direct insurance operations in Argentina. This increase was partially offset by a ~~$2.6~~$2.5 million decrease in other income primarily due to ~~lower returns on~~a decrease in the value of company owned life insurance ~~policies.~~policies and a $2.9 million decrease in net investment income for the same reason as noted above for the second quarter. In 2008, investment income increased due to a larger invested asset base and higher effective investment portfolio yield, which was offset by an increase in the amount allocated to the operating segments to support their growing asset levels.

Total benefits and expenses decreased ~~$5.1~~by $11.1 million, or ~~13.8%~~29.8%, inand $16.2 million, or 21.9%, for the ~~first quarter of~~three and six months ended June 30, 2008, as compared to the same ~~period~~periods in 2007. ~~This~~The decrease for the second quarter was primarily due to a ~~$5.2~~$6.2 million decrease in collateral finance facility expense due to substantially reduced variable interest rates in the current ~~quarter. Other~~year. Policy acquisition costs and other insurance expenses also decreased $2.0 million in the second quarter, primarily due to increased charges to the operating segments for the use of capital. Also contributing to the decrease for the second quarter was a decrease in interest expense of $1.7 million, primarily due to interest provisions for income taxes related to FIN 48, and decreased other operating expenses of $1.1 million, primarily related to a decrease in equity based compensation. The decrease for the six month period was primarily due to an $11.5 million decrease in collateral finance facility expense due to substantially reduced variable interest rates in the current year. Additionally, other operating expenses decreased ~~$2.6~~$3.7 million in 2008 primarily related to a decrease in equity based ~~compensation but was offset by a $2.6~~compensation; policy acquisition costs and other insurance expenses decreased $2.0 million, ~~increase in~~primarily due to increased charges to the operating segments for the use of capital; and interest expense decreased $1.0 million, primarily due to ~~the issuance of $300.0 million in senior notes in March 2007.~~lower interest provisions for income taxes related to FIN 48.

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, 2008 and 2007 were ~~$188.5~~$366.3 million and ~~$285.1~~$515.5 million, respectively. Cash flows from operating activities are affected by the timing of premiums received, claims paid, and working capital changes. The ~~$96.6~~$149.2 million net decrease in operating cash flows during the ~~three~~six months of 2008 compared to the same period in 2007 was primarily a result of cash outflows related to claims, acquisition costs, income taxes and other operating expenses increasing more than cash inflows related to premiums and investment income. Cash from premiums and investment income increased ~~$84.5~~$189.1 million and decreased ~~$19.2~~$37.7 million, respectively, but was more than offset in total by higher operating cash outlays of ~~$161.9~~$300.6 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 that ~~is saleable,~~can be sold, if necessary, to meet the Company’s short- and long-term obligations.

Net cash used in investing activities was ~~$246.3~~$610.0 million and ~~$382.4~~$443.3 million in the first ~~three~~six months of 2008 and the comparable prior-year period, respectively. This ~~decrease~~increase is largely related to the investment of a large deposit of approximately $340.9 million received on an investment type contract in 2008 largely offset by the investment in 2007 of $295.3 million of the net proceeds from the Company’s issuance of senior ~~notes in March 2007.~~notes. 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.

Net cash ~~used in financing activities was $42.5 million in the first three months of 2008 and net cash~~ provided by financing activities was ~~$251.3~~$200.8 million and $179.5 million in the ~~same period~~first six months of ~~2007.~~2008 and 2007, respectively. Changes in cash provided by ~~(used in)~~ financing activities primarily relate to the issuance of equity or debt securities, borrowings or payments under the Company’s existing credit agreements, treasury stock activity and excess deposits (payments) under investment-type contracts.

Debt and Preferred Securities

As of ~~March 31,~~June 30, 2008 and December 31, 2007, the Company had ~~$925.9~~$926.1 million and $925.8 million, respectively, in outstanding borrowings under its debt agreements and was in compliance with all covenants under those agreements.

The Company maintains three revolving credit facilities. The largest is a syndicated credit facility with an overall capacity of $750.0 million that expires in September 2012. The Company may borrow cash and may obtain letters of credit in multiple currencies under this facility. As of ~~March 31,~~June 30, 2008, the Company had no cash borrowings outstanding and ~~$358.0~~$426.6 million in issued, but undrawn, letters of credit under this facility. The Company’s other credit facilities consist of a £15.0 million credit facility that expires in May ~~2009,~~2010, with an outstanding balance of ~~$29.8~~$29.9 million as of ~~March 31,~~June 30, 2008, and an A$50.0 million Australian credit facility that expires in March 2011, with no outstanding balance as of ~~March 31,~~June 30, 2008.

As of ~~March 31,~~June 30, 2008, 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%. 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

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 by a monoline insurance company through a financial guaranty insurance policy. The notes represent senior, secured indebtedness of Timberlake Financial without legal 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, to Timberlake Re.

Asset / Liability Management

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

The Company has established target asset portfolios for each major insurance product, which represent the investment strategies intended to profitably fund its liabilities within acceptable risk parameters. These strategies 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 ~~$350.4~~$409.8 million and $479.4 million at ~~March 31,~~June 30, 2008 and December 31, 2007, respectively. The decrease in the Company’s liquidity position from December 31, 2007 is primarily due to the timing of ~~first~~second quarter investment activity. 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 has entered into sales of investment securities under agreements to repurchase the same securities. These arrangements are used for purposes of short-term financing. There were no securities subject to these agreements outstanding at June 30, 2008. At ~~March 31, 2008 and~~ December 31, 2007, ~~respectively,~~ the book value of securities subject to these agreements, and included in fixed maturity securities was ~~$62.0 million and~~ $30.1 million, while the repurchase obligations of ~~$62.0 million and~~ $30.1 million were reported in other liabilities in the consolidated statement of financial position. The Company also occasionally enters into arrangements to purchase securities under agreements to resell the same securities. Amounts outstanding, if any, are reported in cash and cash equivalents. These agreements are primarily used as yield enhancement alternatives to other cash equivalent investments. There were no agreements outstanding at ~~March 31,~~June 30, 2008 and December 31, 2007. Further, the Company often enters into securities lending agreements whereby certain securities are loaned to third parties, primarily major brokerage firms, in order to earn additional yield. The Company requires a minimum of 102% of the fair value of the loaned securities as collateral in the form of either cash or securities held by the Company or a trust. The cash collateral is reported in cash and the offsetting collateral ~~re-payment~~repayment obligation is reported in other liabilities. The Company had securities lending agreements outstanding of ~~$21.3~~$12.8 million at ~~March 31,~~June 30, 2008. There were no securities lending agreements outstanding at December 31, 2007.

RGA Reinsurance is a member of the Federal Home Loan Bank of Des Moines (“FHLB”) and holds ~~$11.8~~$10.1 million of common stock of the FHLB, which is included in other invested assets on the Company’s condensed consolidated balance sheets. RGA Reinsurance occasionally enters into funding agreements with the FHLB but had no outstanding funding agreements with the FHLB at ~~March 31,~~June 30, 2008 and December 31, 2007.

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,

All investments held by RGA and its subsidiaries are monitored for conformance to the qualitative and quantitative limits prescribed by the applicable jurisdiction’s insurance laws and regulations. In addition, the operating companies’ boards of directors periodically review their respective 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 asset/liability duration matching differs between operating segments. Based on Canadian reserve requirements, ~~a portion of~~ the Canadian liabilities ~~is strictly~~are matched with long-duration Canadian ~~assets, with the remaining assets invested to maximize the total rate of return, given the characteristics of the corresponding liabilities and Company liquidity needs.~~assets. The duration of the Canadian portfolio exceeds twenty years. The duration for all the Company’s portfolios, when consolidated, ~~range~~ranges between eight and ten years. See Note 4 – “Investments” in the Notes to Consolidated Financial Statements of the 2007 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, 2008 and December 31, 2007, approximately ~~97.1%~~96.7% and 97.2%, respectively, 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 ~~46.8%~~46.7% of fixed maturity securities as of ~~March 31,~~June 30, 2008, compared to 46.5% at December 31, 2007. Corporate securities are diversified by sector, with the majority in finance,

commercial and industrial bonds. During the second quarter, the Company increased its allocation to the financial sector. The average Standard & Poor’s (“S&P”) rating of the Company’s corporate securities was “A-“” at ~~March 31,~~June 30, 2008 and December 31, 2007.

The ~~fair value~~National Association of publicly traded fixed maturity securities are based upon quoted market prices or estimates from independent pricing services with oversight from the Company. Private placement fixed maturity securities fair values are based on the credit quality and duration of marketable securities deemed comparable by the Company’s investment advisor, which may be of another issuer. The NAICInsurance Commissioners (“NAIC”) assigns securities quality ratings and uniform valuations called “NAIC Designations” which are used by insurers when preparing their annual statements. The NAIC assigns designations to publicly traded as well as privately placed securities. The designations assigned by the NAIC range from class 1 to class 6, with designations in classes 1 and 2 generally considered investment grade (BBB or higher rating agency designation). NAIC designations in classes 3 through 6 are generally considered below investment grade (BB or lower rating agency designation).

As of ~~March 31,~~June 30, 2008, the Company classified approximately ~~16.1%~~15.5% of its fixed maturity securities in the Level 3 category in accordance with SFAS 157 (refer to Note 5 – “Fair Value Disclosures” in the Notes to Condensed Consolidated Financial Statements for additional information). These securities primarily consist of private placement corporate securities with an inactive trading ~~market and securities for which the Company relies on broker quotes to determine fair value.~~market. Additionally, the Company has included asset-backed securities with subprime exposure in the Level 3 category due to the current market uncertainty associated with these securities.

The quality of the Company’s available-for-sale fixed maturity securities portfolio, as measured at fair value and by the percentage of fixed maturity securities invested in various ratings categories, relative to the entire available-for-sale fixed maturity security portfolio, at ~~March 31,~~June 30, 2008 and December 31, 2007 was as follows (dollars in thousands):


			March 31, 2008							December 31, 2007								June 30, 2008							December 31, 2007
NAIC	NAIC	Rating Agency	Amortized		Estimated		% of			Amortized		Estimated		% of			Rating Agency	Amortized		Estimated		% of			Amortized		Estimated		% of
Designation	Designation	Designation	Cost		Fair Value		Total			Cost		Fair Value		Total			Designation	Cost		Fair Value		Total			Cost		Fair Value		Total
1																	AAA/AA/A	$	7,441,391	$	7,615,888		78.8	%	$	7,022,497	$	7,521,177		80.0	%
2																	BBB		1,812,894		1,730,612		17.9	%		1,628,431		1,617,983		17.2	%
3																	BB		267,856		253,695		2.6	%		201,868		198,487		2.1	%
4																	B		51,320		46,722		0.5	%		47,013		43,680		0.5	%
5																	CCC and lower		18,375		17,250		0.2	%		16,800		16,502		0.2	%
6																	In or near default		3,074		3,794		—	%		83		87		—	%
	1	AAA/AA/A	$	7,127,035	$	7,436,088		79.2	%	$	7,022,497	$	7,521,177		80.0	%
	2	BBB		1,725,432		1,676,870		17.8	%		1,628,431		1,617,983		17.2	%	Total	$	9,594,910	$	9,667,961		100.0	%	$	8,916,692	$	9,397,916		100.0	%
	3	BB		222,209		214,105		2.3	%		201,868		198,487		2.1	%
	4	B		48,225		43,989		0.5	%		47,013		43,680		0.5	%
	5	CCC and lower		16,860		15,987		0.2	%		16,800		16,502		0.2	%
	6	In or near default		53		55		—			83		87		—

		Total	$	9,139,814	$	9,387,094		100.0	%	$	8,916,692	$	9,397,916		100.0	%

Within the fixed maturity security portfolio, the Company held approximately $1.3 billion and $1.4 billion in residential mortgage-backed securities at ~~March 31,~~June 30, 2008 and December 31, 2007, respectively, which include agency-issued pass-through securities, collateralized mortgage obligations guaranteed or otherwise supported by the Federal Home Loan Mortgage Corporation, Federal National Mortgage Association, or the Government National Mortgage Association. As of ~~March 31,~~June 30, 2008 and December 31, 2007, almost all of these securities were investment-grade. Additionally, the Company held ~~$686.7~~$842.1 million and $645.2 million in investment-grade commercial mortgage-backed securities at ~~March 31,~~June 30, 2008 and December 31, 2007, respectively. During 2008, the Company has significantly increased its exposure to investment-grade commercial mortgage-backed securities. Based on the Company’s analysis of this market and the current economic environment, commercial mortgage-backed securities offer value with significant returns relative to the amount of risk. The principal risks inherent in holding mortgage-backed securities are prepayment and extension risks, which will affect the timing of when cash will be received and are dependent on the level of mortgage interest rates. Prepayment risk is the unexpected increase in principal payments, primarily as a result of owner refinancing. Extension risk relates to the unexpected slowdown in

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. 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 ~~March 31,~~June 30, 2008 and December 31, 2007, the Company held investments in securities with subprime mortgage exposure with amortized costs totaling ~~$255.4~~$256.8 million and $267.7 million, and estimated fair values of ~~$221.6~~$219.8 million and $246.8 million, respectively. Those amounts include exposure to subprime mortgages through securities held directly in the Company’s investment portfolios within asset-backed securities, as well as securities backing the Company’s funds withheld at interest investment. The securities are highly rated with weighted average S&P credit ratings of approximately “AA-” at June 30, 2008 and “AA+” at ~~March 31, 2008 and~~ December 31, 2007. 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. Additionally, the recent series of rating agency downgrades of securities in this sector did not significantly affect the Company’s exposure as the Company experienced ~~only one downgrade~~six downgrades within its portfolio of securities. The following tables summarize the securities by rating and underwriting year at ~~March 31,~~June 30, 2008 and December 31, 2007 (dollars in thousands):


	March 31, 2008												June 30,2008
	AAA				AA				A				AAA				AA				A
	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
2003 & Prior	$	16,021	$	16,258	$	1,487	$	1,396	$	3,684	$	3,272	$	10,578	$	10,453	$	1,348	$	1,240	$	8,892	$	8,345
2004		15,262		13,175		33,731		27,870		16,147		14,687		—		—		40,289		30,624		13,561		11,844
2005		52,295		47,580		52,680		46,487		21,595		15,846		49,900		45,229		56,301		49,124		7,954		6,908
2006		13,718		11,371		—		—		—		—		3,872		2,828		4,998		3,100		4,500		3,752
2007		11,436		9,885		—		—		10,501		8,332		2,070		2,047		—		—		11,390		8,718

Total	$	108,732	$	98,269	$	87,898	$	75,753	$	51,927	$	42,137	$	66,420	$	60,557	$	102,936	$	84,088	$	46,297	$	39,567


	BBB				Below Investment Grade				Total
	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
2003 & Prior	$	1,188	$	1,052	$	—	$	—	$	22,380	$	21,978
2004		—		—		—		—		65,140		55,732
2005		2,555		1,269		—		—		129,125		111,182
2006		3,137		3,146		—		—		16,855		14,517
2007		—		—		—		—		21,937		18,217

Total	$	6,880	$	5,467	$	—	$	—	$	255,437	$	221,626

In addition to subprime mortgage exposure, at June 30, 2008, the Company held approximately $116.8 million in amortized cost of “Alt-A” mortgage securities, 89.5% of which were rated “AA” or better. This amount includes securities directly held by the Company and securities backing the Company’s funds withheld at interest investment. The Company’s fixed maturity and funds withheld portfolios include approximately ~~$655.6~~$640.2 million in amortized cost of securities that are insured by various financial guarantors, or less than five percent of consolidated investments. The securities are diversified between municipal bonds and asset-backed securities with well diversified collateral pools. The Company invests in insured collateralized debt obligation (“CDO”) structures backing subprime investments of approximately ~~$0.7~~$0.8 million at ~~March 31,~~June 30, 2008. The insured securities are primarily investment grade without the benefit of the insurance provided by the financial guarantor and therefore the Company does not expect to incur significant realized losses as a result of the recent financial difficulties encountered by several of the financial guarantors. In addition to the insured securities, the Company held investment-grade securities issued by four of the financial guarantors totaling ~~$21.9~~$19.1 million in amortized cost.

at losses of $5.4 million and $12.3 million, respectively, or at 97.9% and 96.9% of book value, respectively. During the six months ended June 30, 2008 and 2007, the Company sold fixed maturity securities and equity securities with fair values of $391.9 million and $629.0 million at losses of ~~$8.9~~$14.3 million and ~~$6.1~~$18.4 million, respectively, or at ~~94.1%~~96.5% and ~~97.5%~~97.2% of book value, respectively. 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 ~~1,290~~1,618 and 1,105 fixed maturity securities and equity securities as of ~~March 31,~~June 30, 2008 and December 31, 2007, respectively, where the estimated fair value had declined and remained below amortized cost by the indicated amount (dollars in thousands):

As of December 31, 2007
Equal to or greater than
Less than 12 months 12 months Total
Gross Gross Gross
Estimated Unrealized Estimated Unrealized Estimated Unrealized
(dollars in thousands) Fair Value Loss Fair Value Loss Fair Value Loss
Investment grade securities:

U.S. corporate securities
$ 1,185,664 $ 63,368 $ 487,626 $ 25,541 $ 1,673,290 $ 88,909
Canadian and Canadian provincial governments
78,045 1,077 4,313 86 82,358 1,163
Residential mortgage-backed securities
299,655 5,473 348,632 6,743 648,287 12,216
Foreign corporate securities
293,783 17,880 155,445 5,995 449,228 23,875
Asset-backed securities
341,337 24,958 72,445 5,722 413,782 30,680
Commercial mortgage-backed securities
110,097 4,499 46,647 588 156,744 5,087
U.S. government and agencies
700 1 — — 700 1
State and political subdivisions
27,265 605 14,518 339 41,783 944
Other foreign government securities
127,397 1,635 75,354 2,878 202,751 4,513

Investment grade securities
2,463,943 119,496 1,204,980 47,892 3,668,923 167,388

Non-investment grade securities:

U.S. corporate securities
106,842 6,044 30,105 1,727 136,947 7,771
Asset-backed securities
1,996 776 — — 1,996 776
Foreign corporate securities
9,692 1,930 3,524 165 13,216 2,095

Non-investment grade securities
118,530 8,750 33,629 1,892 152,159 10,642

Total fixed maturity securities
$ 2,582,473 $ 128,246 $ 1,238,609 $ 49,784 $ 3,821,082 $ 178,030

Equity securities
$ 83,166 $ 16,764 $ 19,073 $ 3,421 $ 102,239 $ 20,185

Total number of securities in an unrealized loss position
691 414 1,105

Continued

As of June 30, 2008
Equal to or greater than
Less than 12 months 12 months Total
Gross Gross Gross
Estimated Unrealized Estimated Unrealized Estimated Unrealized
(dollars in thousands) Fair Value Losses Fair Value Losses Fair Value Losses
Non-investment grade securities:

U.S. corporate securities
138,528 14,543 44,533 5,249 183,061 19,792
Asset-backed securities
1,273 41 4,121 914 5,394 955
Foreign corporate securities
13,076 441 9,315 2,174 22,391 2,615

Non-investment grade securities
152,877 15,025 57,969 8,337 210,846 23,362

Total fixed maturity securities
$ 4,541,145 $ 279,208 $ 1,379,429 $ 172,448 $ 5,920,574 $ 451,656

Equity securities
$ 141,425 $ 29,811 $ 14,714 $ 5,205 $ 156,139 $ 35,016

Total number of securities in an unrealized loss position
1,111 507 1,618

As of December 31, 2007
Equal to or greater than
Less than 12 months 12 months Total
Gross Gross Gross
Estimated Unrealized Estimated Unrealized Estimated Unrealized
(dollars in thousands) Fair Value Losses Fair Value Losses Fair Value Losses
Investment grade securities:

U.S. corporate securities
$ 1,185,664 $ 63,368 $ 487,626 $ 25,541 $ 1,673,290 $ 88,909
Canadian and Canadian provincial governments
78,045 1,077 4,313 86 82,358 1,163
Residential mortgage-backed securities
299,655 5,473 348,632 6,743 648,287 12,216
Foreign corporate securities
293,783 17,880 155,445 5,995 449,228 23,875
Asset-backed securities
341,337 24,958 72,445 5,722 413,782 30,680
Commercial mortgage-backed securities
110,097 4,499 46,647 588 156,744 5,087
U.S. government and agencies
700 1 — — 700 1
State and political subdivisions
27,265 605 14,518 339 41,783 944
Other foreign government securities
127,397 1,635 75,354 2,878 202,751 4,513

Investment grade securities
2,463,943 119,496 1,204,980 47,892 3,668,923 167,388

Non-investment grade securities:

U.S. corporate securities
106,842 6,044 30,105 1,727 136,947 7,771
Asset-backed securities
1,996 776 — — 1,996 776
Foreign corporate securities
9,692 1,930 3,524 165 13,216 2,095

Non-investment grade securities
118,530 8,750 33,629 1,892 152,159 10,642

Total fixed maturity securities
$ 2,582,473 $ 128,246 $ 1,238,609 $ 49,784 $ 3,821,082 $ 178,030

Equity securities
$ 83,166 $ 16,764 $ 19,073 $ 3,421 $ 102,239 $ 20,185

Total number of securities in an unrealized loss position
691 414 1,105

The investment securities in an unrealized loss position as of ~~March 31,~~June 30, 2008 consisted of ~~1,290~~1,618 securities accounting for unrealized losses of ~~$371.3~~$486.7 million. Of these unrealized losses ~~95.4%~~95.2% were investment grade and ~~62.0%~~67.0% were less than 20% below cost. The amount of the unrealized loss on these securities was primarily attributable to increases in interest rates, including a widening of credit default spreads.

Of the investment securities in an unrealized loss position for 12 months or more as of ~~March 31,~~June 30, 2008, 3890 securities were 20% or more below cost, including 3eight securities which were also below investment grade. These securities accounted for unrealized losses of approximately ~~$0.7~~$3.2 million. These securities were all corporate bonds, were current on all terms and the Company currently expects to collect full principal and interest.

As of ~~March 31,~~June 30, 2008, the Company expects these investments to continue to perform in accordance with their original contractual terms and the Company has the ability and intent to hold these investments securities until the recovery of the fair value up to the cost of the investment, which may bybe maturity. Accordingly, the Company does not consider these investments to be other-than-temporary impaired at ~~March 31,~~June 30, 2008. However, from time to time when facts and circumstances arise, the Company may sell securities in the ordinary course of managing ~~it’s~~its portfolio to meet diversification, credit quality, yield enhancement, asset-liability management and liquidity requirements.

The Company’s mortgage loan portfolio consists principally of investments in U.S.-based commercial offices, light industrial properties and retail locations. The mortgage loan portfolio is diversified by geographic region and property type. Substantially all mortgage loans are performing and no valuation allowance has been established as of ~~March 31,~~June 30, 2008 or December 31, 2007.

Policy loans present no credit risk because the amount of the loan cannot exceed the obligation due the ceding company upon the death of the insured or surrender of the underlying policy. The provisions of the treaties in force and the underlying

policies determine the policy loan interest rates. Because policy loans represent premature distributions of policy liabilities, they have the effect of reducing future disintermediation risk. In addition, the Company earns a spread between the interest rate earned on policy loans and the interest rate credited to corresponding liabilities.

Funds withheld at interest comprised approximately ~~28.0%~~28.1% and 28.3% of the Company’s cash and invested assets as of ~~March 31,~~June 30, 2008 and December 31, 2007, respectively. For agreements written on a modified coinsurance basis and certain agreements written on a coinsurance basis, assets equal to the net statutory reserves are withheld and legally 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. The underlying portfolios also include options related to equity indexed annuity products. The market value changes associated with these investments have caused some volatility in reported investment income. This is largely offset by a corresponding change in interest credited, with minimal impact on income before taxes. 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 an average rating of “A+” at ~~March 31,~~June 30, 2008 and December 31, 2007. Certain ceding companies maintain segregated portfolios for the benefit of the Company.

Other invested assets represented approximately ~~2.3%~~2.4% and 1.7% of the Company’s cash and invested assets as of ~~March 31,~~June 30, 2008 and December 31, 2007, respectively. Other invested assets include derivative contracts, equity securities, preferred stocks, structured loans 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 2008 or 2007.

Contractual Obligations

~~Since~~From December 31, 2007 to June 30, 2008, the value of the Company’s obligation for collateral finance facility, including interest, decreased by ~~$229.4~~$235.9 million due to substantially reduced variable interest rates in the current quarter as previously discussed. There were no other material changes in the Company’s contractual obligations from ~~that~~those reported in the 2007 Annual Report.

Mortality Risk Management

In the event that mortality or morbidity experience develops in excess of expectations, some reinsurance treaties allow for increases to future premium rates. Other treaties include experience refund provisions, which may also help reduce RGA’s mortality risk. 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 claims 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 $8.0 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 $8.0 million per individual policy. In total, there are 2214 such cases of over-retained policies, for amounts averaging ~~$1.7~~$2.5 million over the Company’s normal retention limit. The largest amount over-retained on any one life is $10.1 million. The Company ~~has mitigated~~enters into agreements with other reinsurers to mitigate the risk related to the over-retained policies, ~~by entering into one-year agreements with other reinsurers that commenced~~which renew annually in September and ~~October of 2007.~~October. 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 September 7th of each year. The current Program began September 7, 2007, and covers events involving 10 or more insured deaths from a single occurrence. The Company retains the first $10 million in claims, the Program covers the next $40 million in claims, and the Company retains all claims in excess of $50 million. The Program covers reinsurance programs worldwide and includes losses due to acts of terrorism, including terrorism losses due to nuclear, chemical and/or biological events. The Program excludes losses from earthquakes occurring in California and also excludes losses from pandemics. The Program is insured by nine 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, RGA Reinsurance Company (Barbados) Ltd., RGA Americas Reinsurance Company, Ltd., RGA Worldwide Reinsurance Company, Ltd. or RGA Atlantic 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, 2008, all retrocession pool members in this excess retention pool reviewed by the A.M. Best Company were rated “A-”, the fourth highest rating out of fifteen possible ratings, or better. The Company also retrocedes most of its financial reinsurance business to other insurance companies to alleviate 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. Since both derivative and nonderivative financial instruments have market risk, the Company’s risk management extends beyond derivatives to encompass all financial instruments held. 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 interest income.

The Company is subject to foreign currency translation, transaction, and net income exposure. The Company manages its exposure to currency principally by matching invested assets with the underlying reinsurance liabilities to the extent possible. The Company has in place a net investment hedge of a portion of its investment in Canada operations. Translation differences resulting from translating foreign subsidiary balances to U.S. dollars are reflected in stockholders’ equity on the condensed consolidated balance sheets. The Company generally does not hedge the foreign currency exposure of its subsidiaries transacting business in currencies other than their functional currency (transaction exposure). The majority of the Company’s foreign currency transactions are denominated in Australian dollars, British pounds, Canadian dollars, Japanese yen, Korean won, the South African rand and euros.

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, 2008 from that disclosed in the 2007 Annual Report.

New Accounting Standards

effective prospectively for financial statements issued for fiscal years beginning after November 15, 2008. The Company is currently evaluating the impact of FSP 140-3 on its condensed consolidated financial statements.

Effective January 1, 2008, the Company adopted SFAS No. 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 adoption of SFAS 157 resulted in a pre-tax gain of approximately $3.9 million, included in interest credited, related primarily to the decrease in the fair value of liability embedded derivatives associated with equity-indexed annuity products primarily from the incorporation of nonperformance risk, also referred to as the Company’s own credit risk, into the fair value calculation.

In December 2007, the FASB issued SFAS No. 141 (revised 2007), “Business Combinations — A Replacement of FASB Statement No. 141” (“SFAS 141(r)”) and SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements — An Amendment of ARB No. 51” (“SFAS 160”). SFAS 141(r) establishes principles and requirements for how an acquirer recognizes and measures certain items in a business combination, as well as disclosures about the nature and financial effects of a business combination. SFAS 160 establishes accounting and reporting standards surrounding noncontrolling interest, or minority interests, which are the portions of equity in a subsidiary not attributable, directly or indirectly, to a parent. The pronouncements are effective for fiscal years beginning on or after December 15, 2008 and apply prospectively to business combinations. Presentation and disclosure requirements related to noncontrolling interests must be retrospectively applied. The Company is currently evaluating the impact of SFAS 141(r) on its accounting for future acquisitions and the impact of SFAS 160 on its 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.

Numerous important factors could cause actual results and events to differ materially from those expressed or implied by forward-looking statements including, without limitation, (1) adverse changes in mortality, morbidity, lapsation or claims experience, (2) changes in the Company’s financial strength and credit ratings or those of 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 this quarterly report on Form 10-Q and in the 2007 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, 2008, 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~~In January 2006, the Company ~~is currently a party to a~~was threatened with an arbitration related to its life reinsurance business. To date, the ceding company involved has not acted upon this threat. As of ~~March 31,~~June 30, 2008, the ~~party~~ceding company involved in this action has raised a claim in the amount of $4.9 million, none of which ~~is $4.9 million in excess of the amount held in reserve~~has been accrued by the Company. The Company believes it has substantial defenses upon which to contest this claim, including but not limited to ~~misrepresentation and~~ breach of contract by ~~direct and indirect~~the ceding ~~companies.~~ company.

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 acurrently has no such other material ~~adverse effect on its consolidated financial position.~~litigation. However, it is possible that an adverse outcome on any particular arbitration or litigation situation could ~~from time to time,~~ have a material adverse effect on the Company’s consolidated net income in a particular reporting period.

ITEM 1A. Risk Factors

~~There~~In the risk factors below, we refer to the Company as “we,” “us,” or “our”. Other than the risk factors listed below, there have been no material changes from the risk factors previously disclosed in the Company’s 2007 Annual Report.

MetLife is our majority shareholder and its interests may differ from the interests of RGA and our other security holders.

At June 30, 2008, MetLife was the beneficial owner of approximately 51.7% of our outstanding common stock. On June 2, 2008 MetLife and RGA jointly announced a proposed transaction that could lead to MetLife disposing of its majority interest in RGA. The transaction is subject to various conditions, including RGA shareholder and regulatory approvals, and could be completed as early as the third quarter of this year. As a result of MetLife’s ownership position, until it disposes of some or all of the 32,243,539 shares of our common stock it beneficially owns, MetLife may continue to have the ability to significantly influence matters requiring shareholder approval, including without limitation, the election and removal of directors, amendments to our articles of incorporation, mergers, acquisitions, changes of control of our company and sales of all or substantially all of our assets. In addition, at least as long as it is our majority shareholder, MetLife is required to consolidate our results of operations into MetLife’s financial statements. As a result, our board of directors, including the members who are also employed by or affiliated with MetLife, may consider not only the short-term and long-term effect of operating decisions on us, but also the effect of such decisions on MetLife and its affiliates.

Your interests as a holder of our securities may conflict with the interests of MetLife, and the price of our common stock or other securities could be adversely affected by this influence or by the perception that MetLife may seek to sell shares of common stock in the future.

If we experience an ownership change or upon the occurrence of certain other events, we may be unable to realize the benefits of our deferred tax asset.

RGA and certain subsidiaries have significant net operating loss carryforwards (“NOLs,”) and other tax attributes. At December 31, 2007, we had recognized a cumulative gross deferred tax asset associated with NOLs of approximately $932.4 million. NOLs may be carried forward to offset taxable income in future years and eliminate income taxes otherwise payable on such taxable income, subject to certain adjustments. Based on current federal corporate income tax rates, our NOLs and other carryforwards could provide a benefit to us, if fully utilized, of significant future tax savings. However, our ability to use these tax benefits in future years will depend upon the amount of our otherwise taxable income. If we do not have sufficient taxable income in future years to use the tax benefits before they expire, we will lose the benefit of these NOLs permanently.

Additionally, if we experience an “ownership change,” as defined in Section 382 of the Internal Revenue Code of 1986 as amended (“the Code”), the NOLs would be subject to an annual limit on the amount of the taxable income that may be offset by any NOLs generated prior to the ownership change. If an ownership change were to occur, we could be unable to use a portion of our NOLs to offset taxable income. In general, an ownership change occurs when, as of any testing date, the percentage of stock of a corporation owned by one or more “5-percent shareholders,” as defined in the Code and the related Treasury regulations, has increased by more than 50 percentage points over the lowest percentage of stock of the corporation owned by such shareholders at any time

3746

during the three-year period preceding such date. In general, persons who own 5% or more (by value) of a corporation’s stock are 5-percent shareholders, and all other persons who own less than 5% (by value) of a corporation’s stock are treated, together, as a single, public group 5-percent shareholder, regardless of whether they own an aggregate of 5% or more (by value) of a corporation’s stock. If a corporation experiences an ownership change, it is generally subject to an annual limitation, which limits its ability to use its NOLs and other tax attributes to an amount equal to the equity value of the corporation multiplied by the federal long term tax-exempt rate.

At June 30, 2008, MetLife was the beneficial owner of approximately 51.7% of our outstanding common stock. On June 2, 2008, MetLife and RGA jointly announced a proposed transaction that could lead to MetLife disposing of its majority interest in RGA. The transaction is subject to various conditions, including RGA shareholder and regulatory approvals, and could be completed as early as the third quarter of 2008. A divestiture by MetLife will increase the possibility of RGA experiencing such an ownership change. An ownership change could limit our ability to continue to recognize the deferred tax asset associated with the NOLs. A reduction in the amount of our deferred tax asset would have a negative effect on reported earnings and capital levels, and could adversely affect the level of taxes we pay in future years.

Other events outside of RGA’s control, such as certain acquisitions and dispositions of RGA common stock, RGA class A common stock and RGA class B common stock, also may cause RGA (and, consequently, its subsidiaries) to experience an ownership change under Section 382 of the Code and the related Treasury regulations, and limit the ability of RGA and its subsidiaries to utilize fully such NOLs and other tax attributes.

If RGA were to experience an ownership change, it could potentially have in the future higher U.S. federal income tax liabilities than it would otherwise have had and it may also result in certain other adverse consequences to RGA. In this connection, RGA has adopted a Section 382 shareholder rights plan and, at the special shareholders meeting to be held in connection with the potential divestiture transaction with MetLife, the RGA board of directors will recommend the adoption of new Article Fourteen to RGA’s articles of incorporation which will contain certain proposed acquisition restrictions that are intended to reduce the likelihood that RGA and its subsidiaries will experience an ownership change under Section 382 of the Code. There can be no assurance, however, that these efforts will prevent the divestiture, together with certain other transactions involving the stock of RGA, from causing RGA to experience an ownership change and the adverse consequences that may arise from such events.

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~~second quarter ended ~~March 31,~~June 30, 2008:

Total Number of Maximum Number of
Average Price Shares Purchased as Shares that May Yet
Total Number of Paid Part of Publicly Be Purchased Under
Shares Purchased (1) per Share Announced Plans the Plans
February 1, 2008 – February 29, 2008 56,129 $ 55.10 — —

Total Number of Maximum Number
Shares Purchased as of Shares that May
Total Number of Average Price Paid Part of Publicly Yet Be Purchased
Shares Purchased (1) per Share Announced Plans Under the Plans
April 1, 2008 – April 30, 2008 210 $ 53.60 — —


(1)		In ~~February~~April 2008 the Company net settled – issuing ~~217,375~~650 shares from treasury and repurchasing from recipients ~~56,129~~210 shares in settlement of income tax withholding requirements incurred by the 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, 2008, 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.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Reinsurance Group of America, Incorporated

August 1, 2008

By:

/s/ A. Greig Woodring

A. Greig Woodring

~~By:~~

~~/s/ A. Greig Woodring~~

~~May 2, 2008~~

~~A. Greig Woodring~~

President & Chief Executive Officer
(Principal Executive Officer)

August 1, 2008

By:

/s/ Jack B. Lay

~~(Principal Executive Officer)~~

Jack B. Lay

~~By:~~

~~/s/ Jack B. Lay~~

~~May 2, 2008~~

~~Jack B. Lay~~

Senior Executive Vice President & Chief Financial Officer

(Principal Financial and Accounting Officer)

~~(Principal Financial and Accounting Officer)~~

3949

INDEX TO EXHIBITS


Exhibit
Number		Description

2.1		Recapitalization and Distribution Agreement, dated as of June 1, 2008 (the “R&D Agreement”), by and between Reinsurance Group of America, Incorporated (“RGA”) and MetLife, Inc. (the schedules have been omitted pursuant to Item 601 (b)(2) of Regulation S-K and will be furnished supplementally to the SEC upon request), incorporated by reference to Exhibit 2.1 of Current Report on Form 8-K filed June 5, 2008.

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.

3.3		Form of Amended and Restated Articles of Incorporation of RGA proposed for approval by shareholders of RGA at special meeting of shareholders to be called pursuant to the R&D Agreement (constituting Exhibit A to the R&D Agreement listed as Exhibit 2.1 hereto), incorporated by reference to Exhibit 3.3 of Current Report on Form 8-K filed June 5, 2008.

3.4		Form of Amended and Restated Bylaws of RGA to become effective subject to and upon consummation of the recapitalization pursuant to the R&D Agreement (constituting Exhibit B to the R&D Agreement filed as Exhibit 2.1 hereto), incorporated by reference to Exhibit 3.3 of Current Report on Form 8-K filed June 5, 2008.

4.1		Form of Amended and Restated Section 382 Rights Agreement between RGA and Mellon Investor Services, LLC proposed for approval by shareholders of RGA at special meeting of shareholders to be called pursuant to the R&D Agreement, incorporated by reference to Exhibit C to the proxy statement/prospectus in part I of Registration Statement on Form S-4 (No. 333-151390) filed on July 29, 2008.

10.1		2008 Management Incentive Plan, effective May 21, 2008, incorporated by reference to Exhibit 10.1 of Current Report on Form 8-K dated July 21, 2008.

10.2		Fourth Amendment, effective as of May 23, 2007, to the RGA Flexible Stock Plan, as amended and restated July 1, 1998, incorporated by reference to Exhibit 10.6 of Current Report on Form 8-K dated July 21, 2008.

10.3		Fifth Amendment, effective as of May 21, 2008 to the RGA Flexible Stock Plan, as amended and restated July 1, 1998, incorporated by reference to Exhibit 10.7 of Current Report on Form 8-K dated July 21, 2008.

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.

4050


	Three months ended						Three months ended						Six months ended
	March 31, 2008			March 31, 2007			June 30, 2008			June 30, 2007			June 30, 2008			June 30, 2007

Net income	$	31,505		$	76,252		$	110,702		$	77,475		$	142,207		$	153,727
Accumulated other comprehensive income (loss), net of income tax:
Unrealized gains (losses), net of reclassification adjustment for gains (losses) included in net income		(145,996	)		4,643
Unrealized losses, net of reclassification adjustment for losses included in net income								(119,696	)		(136,116	)		(265,692	)		(131,473	)
Currency translation adjustments		(18,325	)		14,057			11,920			58,832			(6,405	)		72,889
Unrealized pension and postretirement benefit adjustment		152			(30	)		117			(283	)		269			(313	)

Comprehensive income (loss)	$	(132,664	)	$	94,922		$	3,043		$	(92	)	$	(129,621	)	$	94,830


	Total assets
	March 31,		December 31,		Total assets
	2008		2007		June 30, 2008		December 31, 2007

U.S.	$	13,922,798	$	13,779,284	$	14,601,544	$	13,779,284
Canada		2,820,033		2,738,005		2,824,335		2,738,005
Europe & South Africa		1,328,742		1,345,900		1,382,268		1,345,900
Asia Pacific		1,485,924		1,355,111		1,549,589		1,355,111
Corporate and Other		2,255,011		2,379,709		2,052,431		2,379,709

Total	$	21,812,508	$	21,598,009	$	22,410,167	$	21,598,009


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

Revenues:
Net premiums	$	1,478,224		$	3,255		$	—		$	1,481,479
Investment income, net of related expenses		194,893			105,951			396			301,240
Investment related losses, net		(3,145	)		(158,598	)		(3	)		(161,746	)
Other revenues		612			25,706			7,058			33,376

Total revenues		1,670,584			(23,686	)		7,451			1,654,349

Benefits and expenses:
Claims and other policy benefits		1,276,160			1,050			—			1,277,210
Interest credited		29,714			106,963			—			136,677
Policy acquisition costs and other insurance expenses		189,281			(104,664	)		448			85,065
Other operating expenses		25,359			4,174			1,413			30,946

Total benefits and expenses		1,520,514			7,523			1,861			1,529,898

Income (loss) before income taxes	$	150,070		$	(31,209	)	$	5,590		$	124,451


				Non-Traditional						Total
				Asset-			Financial			U.S.
	Traditional			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	)		(6,215	)		(7	)		(11,057	)
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			39,043			4,195			244,425
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


	BBB				Below Investment Grade				Total
	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
2003 & Prior	$	1,188	$	1,058	$	—	$	—	$	22,006	$	21,096
2004		—		—		11,118		10,253		64,968		52,721
2005		2,573		2,205		15,083		12,189		131,811		115,655
2006		3,182		3,233		—		—		16,552		12,913
2007		—		—		8,034		6,671		21,494		17,436

Total	$	6,943	$	6,496	$	34,235	$	29,113	$	256,831	$	219,821


Item		Page
	PART I - FINANCIAL INFORMATION

1	Financial Statements

	Condensed Consolidated Balance Sheets (Unaudited)
	March 31, 2008 and December 31, 2007	3

	Condensed Consolidated Statements of Income (Unaudited)
	Three months ended March 31, 2008 and 2007	4

	Condensed Consolidated Statements of Cash Flows (Unaudited)
	Three months ended March 31, 2008 and 2007	5

	Notes to Condensed Consolidated Financial Statements (Unaudited)	6

2	Management’s Discussion and Analysis of
	Financial Condition and Results of Operations	14

3	Quantitative and Qualitative Disclosures About Market Risk	37

4	Controls and Procedures	37

	PART II - OTHER INFORMATION

1	Legal Proceedings	37

1A	Risk Factors	37

2	Unregistered Sales of Equity Securities and Use of Proceeds	38

6	Exhibits	38

	Signatures	39

	Index to Exhibits	40
302 Certification of Chief Executive Officer
302 Certification of Chief Financial Officer
906 Certification of Chief Executive Officer
906 Certification of Chief Financial Officer


Item		Page
	PART I — FINANCIAL INFORMATION
1	Financial Statements

	Condensed Consolidated Balance Sheets (Unaudited) June 30, 2008 and December 31, 2007		3

	Condensed Consolidated Statements of Income (Unaudited) Three and six months ended June 30, 2008 and 2007		4

	Condensed Consolidated Statements of Cash Flows (Unaudited) Six months ended June 30, 2008 and 2007		5

	Notes to Condensed Consolidated Financial Statements (Unaudited)		6

2	Management’s Discussion and Analysis of Financial Condition and Results of Operations		18

3	Quantitative and Qualitative Disclosures About Market Risk		45

4	Controls and Procedures		45

	PART II — OTHER INFORMATION

1	Legal Proceedings		46

1A	Risk Factors		46

2	Unregistered Sales of Equity Securities and Use of Proceeds		47

4	Submission of Matters to a Vote of Security Holders		48

6	Exhibits		48

	Signatures		49

	Index to Exhibits		50
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
Exhibit 32.2


		assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.


	Total Gains and Losses
	Classification of gains/losses (realized/unrealized) included in earnings for the three months
	ended March 31, 2008
														Policy
														acquisition
	Investment			Investment					Claims					costs and
	income, net			related					& other					other
	of related			gains			Other		policy					insurance
	expenses			(losses), net			revenues		benefits		Interest credited			expenses		Total

Assets:
Fixed maturity securities — available-for-sale	$	(188	)	$	(6,922	)	$	—	$	—	$	—		$	—	$	(7,110	)
Funds withheld at interest — embedded derivatives		—			(148,528	)		—		—		—			—		(148,528	)
Other invested assets — equity securities		1			—			—		—		—			—		1
Reinsurance ceded receivable — embedded derivatives		—			—			—		—		—			6,045		6,045

Total	$	(187	)	$	(155,450	)	$	—	$	—	$	—		$	6,045	$	(149,592	)


Liabilities:
Interest sensitive contract liabilities — embedded derivatives	$	—		$	(6,487	)	$	—	$	451	$	(37,642	)	$	—	$	(43,678	)

Total	$	—		$	(6,487	)	$	—	$	451	$	(37,642	)	$	—	$	(43,678	)


The table below summarizes changes in unrealized gains or losses recorded in earnings for the three months ended March 31, 2008 for Level 3 assets and liabilities that are still held at March 31, 2008(dollars in thousands).

	Changes in Unrealized Gains and Losses
	Changes in unrealized gains/losses relating to assets and liabilities still held at the reporting
	date for the three months ended March 31, 2008
														Policy
														acquisition
	Investment			Investment					Claims					costs
	income, net			related					& other					and other
	of related			gains			Other		policy		Interest			insurance
	expenses			(losses), net			revenues		benefits		credited			expenses		Total
Assets:
Fixed maturity securities — available-for-sale	$	(198	)	$	(1,979	)	$	—	$	—	$	—		$	—	$	(2,177	)
Funds withheld at interest — embedded derivatives		—			(148,528	)		—		—		—			—		(148,528	)
Other invested assets — equity securities		1			—			—		—		—			—		1
Reinsurance ceded receivable — embedded derivatives		—			—			—		—		—			7,811		7,811

Total	$	(197	)	$	(150,507	)	$	—	$	—	$	—		$	7,811	$	(142,893	)


Liabilities:
Interest sensitive contract liabilities — embedded derivatives	$	—		$	(6,487	)	$	—	$	71	$	(53,245	)	$	—	$	(59,661	)

Total	$	—		$	(6,487	)	$	—	$	71	$	(53,245	)	$	—	$	(59,661	)


	Total Gains and Losses
	Classification of gains/losses (realized/unrealized) included in earnings for the three months
	ended June 30, 2008
											Policy
	Investment					Claims &					acquisition
	income, net		Investment			other					costs and other
	of related		related gains			policy		Interest			insurance
	expenses		(losses), net			benefits		credited			expenses			Total

Assets:
Fixed maturity securities – available-for-sale	$	345	$	(787	)	$	—	$	—		$	—		$	(442	)
Funds withheld at interest – embedded derivatives		—		(11,452	)		—		—			—			(11,452	)
Other invested assets – equity securities		1		—			—		—			—			1
Reinsurance ceded receivable – embedded derivatives		—		—			—		—			(1,459	)		(1,459	)

Total	$	346	$	(12,239	)	$	—	$	—		$	(1,459	)	$	(13,352	)


Liabilities:
Interest sensitive contract liabilities – embedded derivatives	$	—	$	7,428		$	1,271	$	(2,716	)	$	—		$	5,983

Total	$	—	$	7,428		$	1,271	$	(2,716	)	$	—		$	5,983


	Changes in Unrealized Gains and Losses
	Changes in unrealized gains/losses relating to assets and liabilities still held at the reporting
	date for the three months ended June 30, 2008
											Policy
	Investment					Claims &					acquisition
	income, net		Investment			other					costs and other
	of related		related gains			policy		Interest			insurance
	expenses		(losses), net			benefits		credited			expenses			Total

Assets:
Fixed maturity securities – available-for-sale	$	354	$	(116	)	$	—	$	—		$	—		$	238
Funds withheld at interest – embedded derivatives		—		(11,452	)		—		—			—			(11,452	)
Other invested assets – equity securities		1		—			—		—			—			1
Reinsurance ceded receivable – embedded derivatives		—		—			—		—			(314	)		(314	)

Total	$	355	$	(11,568	)	$	—	$	—		$	(314	)	$	(11,527	)


Liabilities:
Interest sensitive contract liabilities – embedded derivatives	$	—	$	7,428		$	2,419	$	(19,845	)	$	—		$	(9,998	)

Total	$	—	$	7,428		$	2,419	$	(19,845	)	$	—		$	(9,998	)


	Changes in Unrealized Gains and Losses
	Changes in unrealized gains/losses relating to assets and liabilities still held at the reporting
	date for the six months ended June 30, 2008
											Policy
	Investment					Claims &					acquisition
	income, net		Investment			other					costs and other
	of related		related gains			policy		Interest			insurance
	expenses		(losses), net			benefits		credited			expenses		Total

Assets:
Fixed maturity securities – available-for-sale	$	156	$	(2,095	)	$	—	$	—		$	—	$	(1,939	)
Funds withheld at interest – embedded derivatives		—		(159,980	)		—		—			—		(159,980	)
Other invested assets – equity securities		2		—			—		—			—		2
Reinsurance ceded receivable – embedded derivatives		—		—			—		—			7,496		7,496

Total	$	158	$	(162,075	)	$	—	$	—		$	7,496	$	(154,421	)


Liabilities:
Interest sensitive contract liabilities – embedded derivatives	$	—	$	942		$	2,489	$	(73,090	)	$	—	$	(69,659	)

Total	$	—	$	942		$	2,489	$	(73,090	)	$	—	$	(69,959	)


	Three months ended March 31,
	Pension Benefits						Other Benefits
	2008			2007			2008		2007

Determination of net periodic benefit cost:
Service cost	$	819		$	799		$	158	$	206
Interest cost		586			592			145		190
Expected rate of return on plan assets		(469	)		(455	)		—		—
Amortization of prior service cost		7			95			—		—
Amortization of prior actuarial loss		72			113			35		84

Net periodic benefit cost	$	1,015		$	1,144		$	338	$	480


	March 31, 2008							December 31, 2007
			Gross							Gross					June 30, 2008							December 31, 2007
	Number of		Unrealized					Number of		Unrealized							Gross							Gross
	Securities		Loss		% of Total			Securities		Loss		% of Total			Number of		Unrealized					Number of		Unrealized
															Securities		Losses		% of Total			Securities		Losses		% of Total
Less than 20%		1,143	$	230,125		62.0	%		1,039	$	159,563		80.5	%		1,431	$	325,912		67.0	%		1,039	$	159,563		80.5	%
20% or more for less than six months		133		130,954		35.3			59		35,671		18.0			149		119,495		24.5	%		59		35,671		18.0
20% or more for six months or greater		14		10,222		2.7			7		2,981		1.5			38		41,265		8.5	%		7		2,981		1.5

Total		1,290	$	371,301		100.0	%		1,105	$	198,215		100.0	%		1,618	$	486,672		100.0	%		1,105	$	198,215		100.0	%


	As of March 31, 2008												As of June 30, 2008
					Equal to or greater than												Equal to or greater than
	Less than 12 months				12 months				Total				Less than 12 months				12 months				Total
			Gross				Gross				Gross				Gross				Gross				Gross
	Estimated Fair		Unrealized		Estimated		Unrealized		Estimated Fair		Unrealized		Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
(dollars in thousands)	Value		Loss		Fair Value		Loss		Value		Loss		Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
Investment grade securities:
U.S. corporate securities	$	1,364,148	$	105,669	$	506,480	$	47,912	$	1,870,628	$	153,581	$	2,000,333	$	134,633	$	501,405	$	76,540	$	2,501,738	$	211,173
Canadian and Canadian provincial governments		144,448		2,924		25,089		1,258		169,537		4,182		150,207		2,725		61,561		2,944		211,768		5,669
Residential mortgage-backed securities		389,755		16,616		167,342		10,276		557,097		26,892		632,964		19,504		239,712		17,541		872,676		37,045
Foreign corporate securities		396,425		34,494		171,394		11,633		567,819		46,127		517,394		28,215		198,791		23,943		716,185		52,158
Asset-backed securities		271,240		37,976		93,824		12,040		365,064		50,016		173,836		20,577		205,431		33,751		379,267		54,328
Commercial mortgage-backed securities		473,862		40,214		44,599		3,111		518,461		43,325		588,484		47,771		42,374		3,824		630,858		51,595
State and political subdivisions		25,820		2,035		11,554		3,302		37,374		5,337		28,543		3,577		7,400		2,620		35,943		6,197
Other foreign government securities		95,418		1,321		57,301		1,765		152,719		3,086		296,507		7,181		64,786		2,948		361,293		10,129

Investment grade securities	$	3,161,116		241,249		1,077,583		91,297		4,238,699		332,546		4,388,268		264,183		1,321,460		164,111		5,709,728		428,294


Non-investment grade securities:
U.S. corporate securities		131,232		12,660		34,045		2,228		165,277		14,888
Asset-backed securities		1,330		2		—		—		1,330		2
Foreign corporate securities		10,051		1,885		3,420		237		13,471		2,122

Non-investment grade securities		142,613		14,547		37,465		2,465		180,078		17,012

Total fixed maturity securities	$	3,303,729	$	255,796	$	1,115,048	$	93,762	$	4,418,777	$	349,558

Equity securities	$	124,771	$	20,286	$	7,061	$	1,457	$	131,832	$	21,743

Total number of securities in an unrealized loss position		912				378				1,290


	As of December 31, 2007
					Equal to or greater than
	Less than 12 months				12 months				Total
			Gross				Gross				Gross
	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
(dollars in thousands)	Fair Value		Loss		Fair Value		Loss		Fair Value		Loss
Investment grade securities:
U.S. corporate securities	$	1,185,664	$	63,368	$	487,626	$	25,541	$	1,673,290	$	88,909
Canadian and Canadian provincial governments		78,045		1,077		4,313		86		82,358		1,163
Residential mortgage-backed securities		299,655		5,473		348,632		6,743		648,287		12,216
Foreign corporate securities		293,783		17,880		155,445		5,995		449,228		23,875
Asset-backed securities		341,337		24,958		72,445		5,722		413,782		30,680
Commercial mortgage-backed securities		110,097		4,499		46,647		588		156,744		5,087
U.S. government and agencies		700		1		—		—		700		1
State and political subdivisions		27,265		605		14,518		339		41,783		944
Other foreign government securities		127,397		1,635		75,354		2,878		202,751		4,513

Investment grade securities		2,463,943		119,496		1,204,980		47,892		3,668,923		167,388


Non-investment grade securities:
U.S. corporate securities		106,842		6,044		30,105		1,727		136,947		7,771
Asset-backed securities		1,996		776		—		—		1,996		776
Foreign corporate securities		9,692		1,930		3,524		165		13,216		2,095

Non-investment grade securities		118,530		8,750		33,629		1,892		152,159		10,642

Total fixed maturity securities	$	2,582,473	$	128,246	$	1,238,609	$	49,784	$	3,821,082	$	178,030

Equity securities	$	83,166	$	16,764	$	19,073	$	3,421	$	102,239	$	20,185

Total number of securities in an unrealized loss position		691				414				1,105


Directors	Voted For		Withheld
J. Cliff Eason		54,918,894		1,619,008
Joseph A. Reali		46,084,307		10,453,595


	Voted For		Voted Against		Abstain
(2) Proposal to approve the Company’s 2008 Management Incentive Plan		54,629,998		1,067,546		840,358

(3) Proposal to approve an amendment to the Company’s Flexible Stock Plan		53,975,129		2,180,445		382,328

Large accelerated filerþ

Accelerated filero

Non-accelerated filero

Smaller reporting companyo

(Do not check if a smaller reporting company)