3 unchanged sentences
Aflac Incorporated (the Parent Company) and its subsidiaries (collectively with the Parent Company, the Company) desire to take advantage of these provisions.
−Removed: This report contains cautionary statements identifying important factors that could cause actual results to differ materially from those projected herein, and in any other statements made by Company officials in communications with the financial community and contained in documents filed with the Securities and Exchange Commission (SEC).
+Added: This report contains cautionary statements identifying important factors that could cause actual results to differ materially from those projected herein, and in any other statements made by Company officials in communications with the financial community and contained in documents filed with or furnished to the Securities and Exchange Commission (SEC).
Forward-looking statements are not based on historical information and relate to future operations, strategies, financial results or other developments.
1 unchanged sentence
In particular, statements containing words such as the ones listed below or similar words, as well as specific projections of future results, generally qualify as forward-looking.
−Removed: The Company undertakes no obligation to update such forward-looking statements.
−Removed: • expect • anticipate • believe • goal • objective
−Removed: • may • should • estimate • intends • projects
−Removed: • will • assumes • potential • target • outlook
+Added: The Company undertakes no obligation to update such forward-looking statements, except as may be required by law.
+Added: • expect • anticipate • believe • goal • objective • strategy
+Added: • may • should • estimate • intend • project • future
+Added: • will • assume • potential • target • outlook • continue
The Company cautions readers that the following factors, in addition to other factors mentioned from time to time, could cause actual results to differ materially from those contemplated by the forward-looking statements:
3 unchanged sentences
• concentration of business in Japan
−Removed: • limited availability of acceptable yen-denominated investments
+Added: • limited availability of acceptable Japanese yen-denominated investments
• foreign currency fluctuations in the yen/dollar exchange rate
14 unchanged sentences
• competitive environment and ability to anticipate and respond to market trends
−Removed: • catastrophic events, including, but not limited to, as a result of climate change, epidemics, pandemics, tornadoes, hurricanes, earthquakes, tsunamis, war or other military action, major public health issues, terrorism or other acts of violence, and damage incidental to such events
+Added: • catastrophic events, including, but not limited to, epidemics, pandemics, tornadoes, hurricanes, earthquakes, tsunamis, war or other military action, major public health issues, terrorism or other acts of violence, and damage incidental to such events
• ability to protect the Aflac brand and the Company's reputation
4 unchanged sentences
MD&A OVERVIEW
−Removed: MD&A is intended to inform the reader about matters affecting the financial condition and results of operations of Aflac Incorporated and its subsidiaries for the nine-month periods ended September 30, 2025 and 2024, respectively.
+Added: MD&A is intended to inform the reader about matters affecting the financial condition and results of operations of Aflac Incorporated and its subsidiaries for the three-month periods ended March 31, 2026 and 2025, respectively.
Results of operations for interim periods are not necessarily indicative of results for the entire year.
5 unchanged sentences
Hedging Activities
−Removed: Deferred Policy Acquisition Costs
Policy Liabilities
16 unchanged sentences
(collectively, Aflac U.S.).
−Removed: The Parent Company, other operating business units that are not individually reportable, reinsurance activities, including internal reinsurance activity with Aflac Re Bermuda Ltd.
+Added: The Parent Company, other operating business units that are not individually reportable, reinsurance activities, including reinsurance activity of Aflac Re Bermuda Ltd.
(Aflac Re), and other business activities not included in Aflac Japan or Aflac U.S., as well as intercompany eliminations, are included in Corporate and other.
Performance Highlights
−Removed: Total revenues were $4.7 billion in the third quarter of 2025, compared with $2.9 billion in the third quarter of 2024, primarily due to net investment gains of $275 million in the third quarter of 2025 compared with net investment losses of $1.4 billion in the third quarter of 2024.
−Removed: Net earnings were $1.6 billion, or $3.08 per diluted share, in the third quarter of 2025, compared with $(93) million, or $(.17) per diluted share, in the third quarter of 2024.
−Removed: Total revenues were $12.3 billion in the first nine months of 2025, compared with $13.5 billion in the first nine months of 2024, primarily due to net investment losses of $1.1 billion in the first nine months of 2025 compared with net investment gains of $239 million in the first nine months of 2024.
−Removed: Net earnings were $2.3 billion, or $4.21 per diluted share, in the first nine months of 2025, compared with $3.5 billion, or $6.23 per diluted share, in the first nine months of 2024.
−Removed: Net earnings in the third quarter of 2025 included net investment gains of $275 million, compared with net investment losses of $1.4 billion in the third quarter of 2024.
−Removed: Net investment gains in the third quarter of 2025 included $285 million of net gains from certain derivative and foreign currency gains or losses;
−Removed: $33 million of net gains from sales and redemptions;
−Removed: a $10 million gain from an increase in the fair value of equity securities;
+Added: Total revenues were $4.3 billion in the first quarter of 2026, compared with $3.4 billion in the first quarter of 2025, primarily due to net investment gains of $49 million in the first quarter of 2026 compared with net investment losses of $963 million in the first quarter of 2025.
+Added: Net earnings were $1.0 billion, or $1.98 per diluted share, in the first quarter of 2026, compared with $29 million, or $.05 per diluted share, in the first quarter of 2025.
+Added: Net earnings in the first quarter of 2026 included net investment gains of $49 million, compared with net investment losses of $963 million in the first quarter of 2025.
+Added: Net investment gains in the first quarter of 2026 included $164 million of net gains from certain derivative and foreign currency gains or losses;
offset by an increase in credit loss allowances of $61 million;
−Removed: Net earnings in the first nine months of 2025 included net investment losses of $1.1 billion, compared with net investment gains of $239 million in the first nine months of 2024.
−Removed: Net investment losses in the first nine months of 2025 included $1.1 billion of net losses from certain derivative and foreign currency gains or losses;
−Removed: an increase in credit loss allowances of $166 million and $6 million of impairments;
−Removed: offset by $71 million of net gains from sales and redemptions and a $47 million gain from an increase in the fair value of equity securities.
−Removed: The average yen/dollar exchange rate (1) for the three-month period ended September 30, 2025 was 147.68, or .2% stronger than the average yen/dollar exchange rate (1) of 147.95 for the same period in 2024.
−Removed: The average yen/dollar exchange rate (1) for the nine-month period ended September 30, 2025 was 148.03, or 1.7% stronger than the average yen/dollar exchange rate (1) of 150.60 for the same period in 2024.
−Removed: Adjusted earnings (2) in the third quarter of 2025 were $1.3 billion, or $2.49 per diluted share, compared with $1.2 billion, or $2.16 per diluted share in the third quarter of 2024.
−Removed: The slightly stronger yen/dollar exchange rate did not impact adjusted earnings per diluted share.
−Removed: Adjusted earnings (2) in the first nine months of 2025 were $3.2 billion, or $5.92 per diluted share, compared with $3.2 billion, or $5.64 per diluted share, in the first nine months of 2024.
−Removed: The stronger yen/dollar exchange rate positively impacted adjusted earnings per diluted share by $.03.
−Removed: In the first nine months of 2025, Aflac Incorporated repurchased $2.7 billion, or 25.7 million of its common shares.
−Removed: At September 30, 2025, the Company had 121.6 million remaining shares authorized for repurchase.
−Removed: Shareholders’ equity was $28.7 billion, or $54.57 per share, at September 30, 2025, compared with $26.1 billion, or $47.45 per share, at December 31, 2024.
−Removed: Shareholders’ equity at September 30, 2025 included a cumulative increase of $6.8 billion from the effect of changes in discount rate assumptions on insurance reserves, compared with a corresponding cumulative increase of $2.0 billion at December 31, 2024, and a net unrealized loss on investment securities and derivatives of $1.7 billion, compared with a net unrealized gain of $4 million at December 31, 2024.
−Removed: Shareholders’ equity at September 30, 2025 also included an unrealized foreign currency translation loss of $4.5 billion,
−Removed: compared with an unrealized foreign currency translation loss of $5.0 billion at December 31, 2024.
−Removed: The annualized return on average shareholders’ equity in the third quarter of 2025 was 23.5%.
−Removed: Shareholders’ equity excluding accumulated other comprehensive income (AOCI) (2) (adjusted book value) was $28.0 billion, or $53.33 per share, at September 30, 2025, compared with $29.1 billion, or $52.87 per share, at December 31, 2024.
−Removed: Adjusted book value excluding foreign currency remeasurement (2) was $24.4 billion, or $46.35 per share, at September 30, 2025, compared with $23.4 billion, or $42.46 per share, at December 31, 2024.
−Removed: The annualized adjusted return on equity (ROE) excluding foreign currency remeasurement (2) in the third quarter of 2025 was 22.1%.
+Added: $24 million of impairments;
+Added: $16 million of net losses from sales and redemptions;
+Added: and a $14 million loss from a decrease in the fair value of equity securities.
+Added: Adjusted earnings (1) in the first quarter of 2026 were $901 million, or $1.75 per diluted share, compared with $906 million, or $1.66 per diluted share, in the first quarter of 2025.
+Added: The average yen/dollar exchange rate (2) for the three-month period ended March 31, 2026 was 156.87, or 2.8% weaker than the average rate of 152.40 for the same period in 2025.
+Added: The weaker yen/dollar exchange rate negatively impacted adjusted earnings per diluted share by $.02.
+Added: Shareholders’ equity was $30.0 billion, or $58.69 per share, at March 31, 2026, compared with $29.5 billion, or $56.85 per share, at December 31, 2025.
+Added: Shareholders’ equity at March 31, 2026 included a cumulative increase of $9.5 billion from the effect of changes in discount rate assumptions on insurance reserves, compared with a corresponding cumulative increase of $8.0 billion at December 31, 2025, and a net unrealized loss on investment securities and derivatives of $2.7 billion, compared with a net unrealized loss of $1.8 billion at December 31, 2025.
+Added: Shareholders’ equity at March 31, 2026 also included an unrealized foreign currency translation loss of $5.0 billion, compared with an unrealized foreign currency translation loss of $4.8 billion at December 31, 2025.
+Added: The annualized return on average shareholders’ equity in the first quarter of 2026 was 13.7%.
+Added: Shareholders’ equity excluding accumulated other comprehensive income (adjusted book value (1) ) was $28.1 billion, or $54.96 per share, at March 31, 2026, compared with $28.0 billion, or $54.06 per share, at December 31, 2025.
+Added: Adjusted book value excluding foreign currency remeasurement (1) was $21.8 billion, or $42.71 per share, at March 31, 2026, compared with $22.1 billion, or $42.66 per share, at December 31, 2025.
+Added: The annualized adjusted return on equity excluding foreign currency remeasurement (1) in the first quarter of 2026 was 16.4%.
+Added: In the first three months of 2026, Aflac Incorporated repurchased $1.0 billion, or 9.0 million of its common shares.
+Added: At March 31, 2026, the Company had 105.3 million remaining shares authorized for repurchase.
+Added: (1) See the Results of Operations section of this MD&A for a definition of this non-U.S.
+Added: GAAP financial measure.
+Added: (2) Yen/dollar exchange rates are based on the published MUFG Bank, Ltd.
+Added: telegraphic transfer middle rate (TTM).
Cyber Incident
−Removed: As previously disclosed , the Company identified an incident involving unauthorized access to its network in the U.S.
+Added: As previously disclosed , the Company identified an incident involving unauthorized access to a limited number of its systems in the U.S.
on June 12, 2025.
−Removed: The Company promptly initiated its cybersecurity incident response protocols and continues to believe it contained the intrusion within hours.
−Removed: The Company's systems were not affected by ransomware, and the Company continues to serve its policyholders and underwrite policies, review claims, and otherwise service customers as usual.
−Removed: The Company also remains engaged with leading third-party cybersecurity experts to support the Company’s response to the incident.
−Removed: The Company is aware of the exfiltration of certain data including claims information, health information, social security numbers and/or other personal information relating to a substantial number of customers, beneficiaries, employees, agents, and other individuals in the Company’s U.S.
−Removed: The Company is still in the process of validating the extent and nature of the files that were involved.
−Removed: Based on the information currently available and the investigation to date, as of the date of this report, the Company has not determined that the incident is reasonably likely to have a material impact on the Company’s financial condition or results of operations.
−Removed: However, the Company’s investigation remains ongoing and as a result, it does not yet know the full impact of the cybersecurity incident, including how much of the financial impact will be covered by insurance.
+Added: The Company promptly initiated its cybersecurity incident response protocols and believes it contained the unauthorized access within hours.
+Added: The Company's systems were not affected by ransomware, and the Company remained able to serve its policyholders and underwrite policies, review claims, and otherwise service customers as usual.
+Added: The Company is aware of the exfiltration of certain data including claims information, health information, social security numbers and/or other personal information relating to customers, beneficiaries, employees, agents, and other individuals in the Company’s U.S.
+Added: In December 2025, the Company completed a detailed review of the potentially impacted files and determined that personal information associated with approximately 22.65 million individuals was involved.
+Added: As of the date of this filing, the Company has completed the notification process to impacted individuals and regulatory authorities as required by applicable laws.
+Added: Based on the information currently available, as of the date of this report, the Company does not believe that the incident is reasonably likely to have a material impact on the Company’s financial condition or results of operations.
+Added: The Company continues to assess the financial impact of the cybersecurity incident, including how much of the financial impact will be covered by insurance.
As a result of the cybersecurity incident, the Company has incurred certain costs and may, depending on future developments, incur additional costs, including but not limited to:
5 unchanged sentences
and costs incurred in meeting evolving legal and regulatory requirements concerning cybersecurity governance, monitoring, and disclosure.
−Removed: The costs associated with the incident to date, including the cost to investigate and respond to the incident as well as related legal and other professional services, resulted in a slight increase to the Company's expenses and are recorded in the insurance and other expenses line in the consolidated statement of earnings.
−Removed: dollar exchange rates are based on the published MUFG Bank, Ltd.
−Removed: telegraphic transfer middle rate (TTM).
−Removed: (2) See the Results of Operations section of this MD&A for a definition of this non-U.S.
−Removed: GAAP financial measure.
RESULTS OF OPERATIONS
7 unchanged sentences
Due to the size of Aflac Japan, where the functional currency is the Japanese yen, fluctuations in the yen/dollar exchange rate can have a significant effect on reported results.
−Removed: In periods when the yen weakens, translating yen into dollars results in fewer dollars being reported.
−Removed: When the yen strengthens, translating yen into dollars results in more dollars being reported.
−Removed: Consequently, yen weakening has the effect of suppressing current period results in relation to the comparable prior period, while yen strengthening has the effect of magnifying current period results in relation to the comparable prior
−Removed: A significant portion of the Company’s business is conducted in yen and never converted into dollars but translated into dollars for U.S.
+Added: In periods when the Japanese yen weakens, translating Japanese yen into U.S.
+Added: dollars results in fewer U.S.
+Added: dollars being reported.
+Added: When the Japanese yen strengthens, translating Japanese yen into U.S.
+Added: dollars results in more U.S.
+Added: dollars being reported.
+Added: Consequently, Japanese yen weakening has the effect of suppressing current period results in relation to the comparable prior period, while Japanese yen strengthening has the effect of magnifying current period results in relation to the comparable prior period.
+Added: A significant portion of the Company’s business is conducted in Japanese yen and never converted into U.S.
+Added: dollars but translated into U.S.
+Added: dollars for U.S.
GAAP reporting purposes, which results in foreign currency impact to earnings, cash flows and book value on a U.S.
18 unchanged sentences
GAAP financial measure for adjusted net investment gains and losses is net investment gains and losses.
−Removed: • Amortized hedge costs/income represent costs/income incurred or recognized as a result of using foreign currency derivatives to hedge certain foreign exchange risks in the Company's Japan segment or in Corporate and other.
+Added: • Amortized hedge costs/income represent costs/income incurred or recognized as a result of using foreign currency derivatives to hedge certain foreign currency exchange risks in the Company's Japan segment or in Corporate and other.
These amortized hedge costs/income are estimated at the inception of the derivatives based on the specific terms of each contract and are recognized on a straight-line basis over the contractual term of the derivative.
2 unchanged sentences
GAAP financial measure for amortized hedge costs/income.
−Removed: • Adjusted earnings excluding current period foreign currency impact are computed using the average foreign currency exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes.
+Added: • Adjusted earnings excluding current period foreign currency impact are computed using the average foreign exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign exchange rate changes.
Adjusted earnings per diluted share excluding current period foreign currency impact is adjusted earnings excluding current period foreign currency impact divided by the weighted average outstanding diluted shares for the period presented.
21 unchanged sentences
The most comparable U.S.
−Removed: GAAP financial measure for adjusted return on equity is return on average equity as determined using annualized net earnings and average total shareholders’ equity.
+Added: GAAP financial measure for adjusted return on equity is return on equity as determined using annualized net earnings and average total shareholders’ equity.
• Adjusted return on equity excluding foreign currency remeasurement is annualized adjusted earnings divided by average shareholders’ equity, excluding both accumulated other comprehensive income and the cumulative (beginning January 1, 2021) foreign currency gains/losses associated with i) foreign currency remeasurement and ii) sales and redemptions of invested assets.
1 unchanged sentence
The most comparable U.S.
−Removed: GAAP financial measure for adjusted return on equity excluding foreign currency remeasurement is return on average equity as determined using annualized net earnings and average total shareholders’ equity.
+Added: GAAP financial measure for adjusted return on equity excluding foreign currency remeasurement is return on equity as determined using annualized net earnings and average total shareholders’ equity.
dollar-denominated investment income excluding foreign currency impact represents amounts excluding foreign currency impact on U.S.
−Removed: dollar-denominated investment income using the average foreign currency exchange rate for the comparable prior year period.
+Added: dollar-denominated investment income using the average foreign exchange rate for the comparable prior year period.
The Company considers U.S.
7 unchanged sentences
Reconciliation of Net Earnings to Adjusted Earnings
−Removed: In Millions Per Diluted Share In Millions Per Diluted Share
−Removed: Three Months Ended September 30, Nine Months Ended September 30,
+Added: In Millions Per Diluted Share
+Added: Three Months Ended March 31,
2026 2025 2026 2025
7 unchanged sentences
Current period foreign currency impact (2)
−Removed: (1) N/A .00 N/A (16) N/A (.03) N/A
+Added: 8 N/A .02 N/A
Adjusted earnings excluding current period foreign currency impact $ 909 $ 906 $ 1.77 $ 1.66
6 unchanged sentences
Reconciliation of Net Investment (Gains) Losses to Adjusted Net Investment (Gains) Losses
−Removed: Three Months Ended September 30, Nine Months Ended September 30,
+Added: Three Months Ended March 31,
(In millions) 2026 2025
4 unchanged sentences
Net interest income (expense) from derivatives associated with certain investment strategies
−Removed: (66) (88) (195) (265)
Impact of interest from derivatives associated with notes payable 0 4
1 unchanged sentence
The Company's investment strategy is to invest primarily in fixed maturity securities to provide a reliable stream of investment income, which is one of the drivers of the Company’s profitability.
−Removed: This investment strategy incorporates asset-liability matching (ALM) to align the expected cash flows of the portfolio to the needs of the Company's liability structure.
+Added: This investment strategy incorporates asset-liability matching to align the expected cash flows of the portfolio to the needs of the Company's liability structure.
The Company does not purchase securities with the intent of generating investment gains or losses.
8 unchanged sentences
Securities transactions include gains and losses from sales and redemptions of investments where the amount received is different from the amortized cost of the investment.
−Removed: Credit losses include losses for held-to-maturity fixed maturity securities, available-for-sale fixed maturity securities, loan receivables, loan commitments and reinsurance recoverables.
+Added: Credit losses include losses for held-to-maturity securities, available-for-sale securities, loan receivables, loan commitments and reinsurance recoverables.
Changes in the fair value of equity securities are the result of gains or losses driven by fluctuations in market prices.
Certain Derivative and Foreign Currency Activities
−Removed: The Company's derivative activities include:
−Removed: • foreign currency forwards and options used in hedging foreign exchange risk on U.S.
−Removed: dollar-denominated investments in Aflac Japan's portfolio, with options used on a standalone basis and/or in a collar strategy;
−Removed: • foreign currency forwards and options used to economically hedge certain portions of forecasted cash flows denominated in yen and hedge the Company's long term exposure to a weakening yen;
−Removed: • foreign currency swaps used to hedge the foreign currency exchange risk associated with certain investments denominated in other foreign currencies in Aflac Japan's portfolio;
−Removed: • cross-currency swaps, also referred to as foreign currency swaps, associated with certain senior notes and subordinated debentures;
−Removed: • foreign currency swaps that are associated with variable interest entity (VIE) bond purchase commitments, and investments in special-purpose entities, including VIEs where the Company is the primary beneficiary;
−Removed: • interest rate swaps used to economically hedge interest rate fluctuations in certain variable-rate investments;
−Removed: • interest rate swaptions used to hedge changes in the fair value associated with interest rate fluctuations for certain U.S.
−Removed: dollar-denominated available-for-sale fixed-maturity securities;
−Removed: • bond purchase commitments at the inception of investments in consolidated VIEs.
+Added: The Company's freestanding derivative instruments include:
+Added: • Foreign currency forwards
+Added: • Foreign currency options
+Added: • Foreign currency swaps
+Added: • Cross-currency swaps
+Added: • Interest rate swaps
+Added: • Interest rate swaptions (swaptions)
+Added: • Bond purchase commitments
Gains and losses are recognized as a result of valuing these derivatives, net of the effects of hedge accounting.
15 unchanged sentences
In January 2025, as part of the U.S.
−Removed: defined benefit plan freeze, the Company purchased a nonparticipating single premium group annuity contract from an external insurer to settle its obligations under the plan and paid to the insurer the related annuity premium.
+Added: defined benefit plan freeze effective January 1, 2024, the Company purchased a nonparticipating single premium group annuity contract from an external insurer to settle its obligations under the plan and paid to the insurer the related annuity premium.
As a result, the Company recognized a settlement charge of $55 million in the first quarter of 2025.
2 unchanged sentences
Foreign Currency Translation
−Removed: Aflac Japan’s premiums and a significant portion of its investment income are received in yen, and its claims and most expenses are paid in yen.
−Removed: Aflac Japan purchases yen-denominated assets and U.S.
−Removed: dollar-denominated assets, which may be hedged to yen, to support yen-denominated policy liabilities.
−Removed: Yen-denominated income statement accounts are translated to U.S.
−Removed: dollars using the weighted average Japanese yen/U.S.
−Removed: dollar foreign exchange rate for the reporting period, except realized gains and losses on securities transactions which are translated at the exchange rate on the trade date of each transaction.
−Removed: Yen-denominated balance sheet accounts are translated to U.S.
−Removed: dollars using the spot Japanese yen/U.S.
−Removed: dollar foreign exchange rate at the end of the reporting period.
+Added: Aflac Japan’s premiums and a significant portion of its investment income are received in Japanese yen, and its claims and most expenses are paid in Japanese yen.
+Added: Aflac Japan purchases Japanese yen-denominated assets and U.S.
+Added: dollar-denominated assets, which may be hedged to Japanese yen, to support Japanese yen-denominated policy liabilities.
+Added: Japanese yen-denominated income statement accounts are translated to U.S.
+Added: dollars using the weighted average yen/dollar foreign exchange rate for the reporting period, except realized gains and losses on securities transactions which are translated at the foreign exchange rate on the trade date of each transaction.
+Added: Japanese yen-denominated balance sheet accounts are translated to U.S.
+Added: dollars using the spot yen/dollar exchange rate at the end of the reporting period.
In recent periods, the Japanese yen has weakened against the U.S.
−Removed: however, the yen strengthened against the U.S.
−Removed: dollar during the first nine months of 2025.
−Removed: Although the Company is unable to predict the timing or extent of future movements of the Japanese yen/U.S.
−Removed: dollar foreign exchange rate, the Company maintains hedging strategies (see the Hedging Activities section of this MD&A) that are intended to mitigate the impacts of yen fluctuation on the Company’s financial position and results of operations.
+Added: Although the Company is unable to predict the timing or extent of future movements of the yen/dollar exchange rate, the Company maintains hedging strategies (see the Hedging Activities section of this MD&A) that are intended to mitigate the impacts of Japanese yen fluctuation on the Company’s financial position and results of operations.
See the risk factor entitled “The Company is exposed to foreign currency fluctuations in the yen/dollar exchange rate” in Item 1A.
1 unchanged sentence
The Company's combined U.S.
−Removed: and Japanese effective income tax rate on pretax earnings was 17.8% for the three-month period ended September 30, 2025, compared with 201.8% for the same period in 2024.
−Removed: The Company's combined U.S.
−Removed: and Japanese effective income tax rate on pretax earnings was 23.4% for the nine-month period ended September 30, 2025, compared with 17.3% for the same period in 2024.
+Added: and Japanese effective income tax rate on pretax earnings was 16.8% for the three-month period ended March 31, 2026, compared with 80.3% for the same period in 2025.
The combined effective tax rate differs from the U.S.
statutory rate primarily due to the exclusion of foreign currency translation gains and losses on certain Aflac Japan U.S.
−Removed: dollar-denominated investments held in the Delaware Statutory Trust and the impact of historic and solar tax credits.
+Added: dollar-denominated investments held in the Delaware Statutory Trust.
For additional information, see Note 10 of the Notes to the Consolidated Financial Statements and the Critical Accounting Estimates - Income Taxes section of Item 7.
6 unchanged sentences
(Excluding Foreign Currency Remeasurement)
−Removed: The following table is a reconciliation of items impacting adjusted book value and adjusted book value per diluted share excluding foreign currency remeasurement to the most directly comparable U.S.
−Removed: GAAP financial measures of book value and book value per diluted share, respectively.
−Removed: (In millions, except for share and per-share amounts) September 30,
+Added: The following table is a reconciliation of items impacting adjusted book value excluding foreign currency remeasurement and adjusted book value excluding foreign currency remeasurement per common share to the most directly comparable U.S.
+Added: GAAP financial measures of book value and book value per common share, respectively.
+Added: (In millions, except for share and per-share amounts) March 31,
2026 December 31,
27 unchanged sentences
GAAP financial measure of return on equity.
−Removed: Three Months Ended September 30,
+Added: Three Months Ended March 31,
GAAP return on equity - net earnings (1)
−Removed: 23.5 % (1.5) %
Impact of excluding unrealized foreign currency translation gains (losses) (2.3) .0
18 unchanged sentences
Aflac Japan is the principal contributor to consolidated earnings.
−Removed: In addition, the Parent Company, other business units that are not individually reportable, reinsurance activities, including internal reinsurance activity with Aflac Re, and other business activities not included in Aflac Japan or Aflac U.S., as well as intercompany eliminations, are included in Corporate and other.
+Added: In addition, the Parent Company, other business units that are not individually reportable, reinsurance activities, including reinsurance activity of Aflac Re, and other business activities not included in Aflac Japan or Aflac U.S., as well as intercompany eliminations, are included in Corporate and other.
Business in the 2025 Annual Report for a summary of each segment's products and distribution channels.
8 unchanged sentences
• Return on Average Invested Assets
+Added: • Portfolio Book Yield
• Average Weekly Producer
10 unchanged sentences
In Dollars In Yen
−Removed: Three Months Ended September 30, Nine Months Ended September 30, Three Months Ended September 30, Nine Months Ended September 30,
+Added: Three Months Ended March 31, Three Months Ended March 31,
(In millions of dollars and billions of yen) 2026 2025 2026 2025
28 unchanged sentences
Pretax adjusted earnings 5.1 (10.9) 8.3 (8.7)
−Removed: (1) Includes a gain (loss) of $(55) and $(75) for the three-month periods and $(55) and $(80) for the nine-month periods ended September 30, 2025 and 2024, respectively, related to remeasurement of the deferred profit liability for limited-payment contracts.
−Removed: (2) Net interest income/expense from derivatives associated with certain investment strategies of $(59) and $(79) for the three-month periods and $(176) and $(237) for the nine-month periods ended September 30, 2025 and 2024, respectively, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income.
−Removed: For the three-month period ended September 30, 2025, operating results in yen terms compared to the same period in the previous year were as follows:
−Removed: • Net earned premiums decreased primarily due to approximately ¥7 billion related to the internal cancer reinsurance transaction with Aflac Re established in the fourth quarter of 2024 and approximately ¥4 billion from limited-pay products reaching premium paid-up status.
−Removed: Net earned premiums also reflect a remeasurement loss of approximately ¥8 billion related to assumption updates of the deferred profit liability for limited-payment contracts in the third quarter of 2025, compared to a loss of approximately ¥11 billion in 2024.
−Removed: • Adjusted net investment income was relatively flat.
−Removed: • Total adjusted revenues decreased primarily due to the decrease in net earned premiums.
−Removed: • Total benefits and claims decreased primarily due to approximately ¥68 billion of reserve remeasurement gains related to assumption updates in the third quarter of 2025, compared to reserve remeasurement gains of approximately ¥50 billion in the third quarter of 2024, as well as the internal cancer reinsurance transaction with Aflac Re established in the fourth quarter of 2024.
−Removed: • Total adjusted expenses decreased primarily due to the impact of the internal cancer reinsurance transaction with Aflac Re established in the fourth quarter of 2024 and an increase in the capitalization of deferred policy acquisition costs resulting from higher sales.
−Removed: • Pretax adjusted earnings increased primarily due to the decrease in total benefits and claims, partially offset by the decrease in total adjusted revenues.
−Removed: For the nine-month period ended September 30, 2025, operating results in yen terms compared to the same period in the previous year were as follows:
−Removed: • Net earned premiums decreased primarily due to approximately ¥21 billion related to the internal cancer reinsurance transaction with Aflac Re established in the fourth quarter of 2024 and approximately ¥11 billion from limited-pay products reaching premium paid-up status.
−Removed: Net earned premiums also reflect a remeasurement loss of approximately ¥8 billion related to assumption updates of the deferred profit liability for limited-payment contracts in the third quarter of 2025, compared to a loss of approximately ¥11 billion in 2024.
−Removed: • Adjusted net investment income decreased primarily due to lower floating rate income.
−Removed: • Total adjusted revenues decreased primarily due to the decreases in net earned premiums and adjusted net investment income.
−Removed: • Total benefits and claims decreased primarily due to approximately ¥68 billion of reserve remeasurement gains related to assumption updates in the third quarter of 2025, compared to reserve remeasurement gains of approximately ¥50 billion in the third quarter of 2024, as well as the internal cancer reinsurance transaction with Aflac Re established in the fourth quarter of 2024.
−Removed: • Total adjusted expenses increased primarily due to an increase in technology expenses, partially offset by the impact of the internal cancer reinsurance transaction with Aflac Re established in the fourth quarter of 2024.
−Removed: • Pretax adjusted earnings decreased primarily due to the decrease in total adjusted revenues, partially offset by the decrease in total benefits and claims.
−Removed: Annualized premiums in force decreased 2.5% to ¥1.19 trillion as of September 30, 2025, compared with ¥1.22 trillion as of September 30, 2024.
+Added: (1) Includes a gain (loss) of an immaterial amount for the three-month periods ended March 31, 2026 and 2025, respectively, related to remeasurement of the deferred profit liability for limited-payment contracts.
+Added: (2) Net interest income/expense from derivatives associated with certain investment strategies of $(53) and $(58) for the three-month periods ended March 31, 2026 and 2025, respectively, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income.
+Added: For the three-month period ended March 31, 2026, operating results in yen terms compared to the same period in the previous year were as follows:
+Added: • Net earned premiums decreased primarily due to approximately ¥4 billion related to an external reinsurance transaction established in the first quarter of 2026 and approximately ¥3 billion from limited-pay products reaching premium paid-up status.
+Added: • Adjusted net investment income increased primarily due to higher fixed rate income from U.S.
+Added: dollar-denominated investments and higher variable net investment income.
+Added: • Total adjusted revenues decreased primarily due to the decrease in net earned premiums, partially offset by the increase in adjusted net investment income.
+Added: • Total benefits and claims decreased primarily reflecting the impact of assumption updates performed in the third quarter of 2025 and higher reserve remeasurement gains.
+Added: • Total adjusted expenses decreased primarily due to an increase in the capitalization of deferred policy acquisition costs resulting from higher sales.
+Added: • Pretax adjusted earnings increased primarily due to the decreases in total benefits and claims and total adjusted expenses, partially offset by the decrease in total adjusted revenues.
+Added: Annualized premiums in force decreased 2.5% to ¥1.17 trillion as of March 31, 2026, compared with ¥1.20 trillion as of March 31, 2025.
The decrease in annualized premiums in force in yen was driven primarily by limited-pay products reaching premium paid-up status.
−Removed: Annualized premiums in force, translated into dollars at respective period-end exchange rates, were $8.0 billion at September 30, 2025, compared with $8.5 billion at September 30, 2024.
−Removed: As of September 30, 2025, Aflac Japan exceeded 22 million individual policies in force in Japan, with approximately 14 million cancer policies in force in Japan.
+Added: Annualized premiums in force, translated into U.S.
+Added: dollars at respective period-end foreign exchange rates, were $7.3 billion at March 31, 2026, compared with $8.0 billion at March 31, 2025.
+Added: As of March 31, 2026, Aflac Japan had approximately 22 million individual policies in force in Japan, including approximately 14 million cancer policies in force.
Aflac Japan's investment portfolios include U.S.
−Removed: dollar-denominated securities and reverse dual-currency securities (yen-denominated debt securities with dollar coupon payments).
−Removed: In years when the yen strengthens in relation to the dollar, translating Aflac Japan's U.S.
−Removed: dollar-denominated investment income into yen lowers growth rates for net investment income, total adjusted revenues, and pretax adjusted earnings in yen terms.
−Removed: In years when the yen weakens, translating U.S.
−Removed: dollar-denominated investment income into yen magnifies growth rates for net investment income, total adjusted revenues, and pretax adjusted earnings in yen terms.
+Added: dollar-denominated securities and reverse dual-currency securities (Japanese yen-denominated fixed maturity securities with dollar coupon payments).
+Added: In years when the Japanese yen strengthens in relation to the U.S.
+Added: dollar, translating Aflac Japan's U.S.
+Added: dollar-denominated investment income into Japanese yen lowers growth rates for net investment income, total adjusted revenues, and pretax adjusted earnings in Japanese yen terms.
+Added: In years when the Japanese yen weakens, translating U.S.
+Added: dollar-denominated investment income into Japanese yen magnifies growth rates for net investment income, total adjusted revenues, and pretax adjusted earnings in Japanese yen terms.
The following table illustrates the effect of translating Aflac Japan’s U.S.
−Removed: dollar-denominated investment income and related items into yen by comparing certain segment results with those that would have been reported had foreign currency exchange rates remained unchanged from the comparable period in the prior year.
−Removed: Amounts excluding foreign
−Removed: currency impact on U.S.
−Removed: dollar-denominated investment income were determined using the average foreign currency exchange rate for the comparable prior year period.
+Added: dollar-denominated investment income and related items into Japanese yen by comparing certain segment results with those that would have been reported had foreign exchange rates remained unchanged from the comparable period in the prior year.
+Added: Amounts excluding foreign currency impact on U.S.
+Added: dollar-denominated investment income were determined using the average foreign exchange rate for the comparable prior year period.
GAAP financial measures defined above.
Aflac Japan Percentage Changes Over Previous Period
−Removed: (Yen Operating Results)
−Removed: For the Periods Ended September 30,
+Added: (Japanese Yen Operating Results)
+Added: For the Periods Ended March 31,
Including Foreign
1 unchanged sentence
Currency Changes
−Removed: Three Months Nine Months
−Removed: Three Months Nine Months
2026 2025 2026 2025
2 unchanged sentences
Pretax adjusted earnings 8.3 (8.7) 6.6 (9.8)
−Removed: The following table presents a summary of operating ratios in yen terms for Aflac Japan followed by a discussion of the significant drivers of changes in operating ratios in yen compared to the same periods in the previous year.
−Removed: Three Months Ended September 30, Nine Months Ended September 30,
+Added: The following table presents a summary of operating ratios in Japanese yen terms for Aflac Japan followed by a discussion of the significant drivers of changes in operating ratios in Japanese yen compared to the same period in the previous year.
+Added: Three Months Ended March 31,
Ratios to total adjusted revenues:
−Removed: 2025 2024 2025 2024
Total benefits and claims, net 45.6 % 48.7 %
9 unchanged sentences
Amortization of deferred policy acquisition costs 4.9 4.7
−Removed: • For the three- and nine-month periods ended September 30, 2025, the total benefits and claims to total premiums ratio decreased primarily due to lower benefits following assumption updates in the third quarter of 2025.
−Removed: For the full year of 2025, the Company expects Aflac Japan to generate a benefit ratio in the range of 58% to 60% as a result of the impact from assumption updates in the third quarter of 2025.
−Removed: • For the three-month period ended September 30, 2025, the total adjusted expense ratio decreased primarily due to the decrease in total adjusted expenses associated with reinsurance activity and an increase in the capitalization of deferred policy acquisition costs resulting from higher sales.
−Removed: For the nine-month period ended September 30, 2025, the total adjusted expense ratio increased primarily due to an increase in technology expenses.
−Removed: • In total, the pretax adjusted profit margin increased in the three- and nine-month periods ended September 30, 2025 primarily due to the lower benefit ratio.
−Removed: The following table presents Aflac Japan's premium persistency on a 12-month rolling basis as of September 30.
+Added: • For the three-month period ended March 31, 2026, the total benefits and claims to total premiums ratio decreased primarily due to lower benefits reflecting the impact of assumption updates performed in the third quarter of 2025 and higher reserve remeasurement gains.
+Added: • For the three-month period ended March 31, 2026, the total adjusted expense ratio decreased slightly primarily due to the decrease in total adjusted expenses, mostly offset by the decrease in total adjusted revenues.
+Added: • In total, the pretax adjusted profit margin increased in the three-month period ended March 31, 2026 primarily due to the lower benefit ratio.
+Added: The following table presents Aflac Japan's premium persistency on a 12-month rolling basis as of March 31.
Premium persistency 92.8 % 93.8 %
Aflac Japan Sales
−Removed: The following table presents Aflac Japan’s new annualized premium sales for the periods ended September 30.
+Added: The following table presents Aflac Japan’s new annualized premium sales for the periods ended March 31.
In Dollars In Yen
−Removed: Three Months Nine Months
−Removed: Three Months Nine Months
(In millions of dollars and billions of yen) 2026 2025 2026 2025
1 unchanged sentence
Increase (decrease) over prior period 21.7 % 10.1 % 25.5 % 12.6 %
−Removed: The increase in new annualized premium sales on a yen basis in the third quarter and first nine months of 2025 was driven primarily by continued strong sales of the new cancer insurance product, Miraito , that was launched in certain sales channels in mid-March 2025 and available in all sales channels starting in the second quarter of 2025 as well as sales of Tsumitasu for the first nine months of 2025.
−Removed: The following table details the contributions to Aflac Japan's new annualized premium sales by major insurance product for the periods ended September 30.
−Removed: Three Months Nine Months
−Removed: 2025 2024 2025 2024
+Added: The increase in new annualized premium sales on a Japanese yen basis in the first quarter of 2026 was driven primarily by strong sales of Anshin Palette, the new medical insurance product launched in December 2025, as well as Miraito and Tsumitasu .
+Added: The following table details the contributions to Aflac Japan's new annualized premium sales by major insurance product for the periods ended March 31.
Cancer 54.1 % 59.7 %
1 unchanged sentence
Life insurance:
−Removed: Traditional life (1)
−Removed: 17.7 30.8 17.6 21.5
−Removed: WAYS 1.0 .8 1.2 2.5
−Removed: Child endowment .1 .1 .1 .2
−Removed: Other .5 .8 .6 1.0
+Added: Tsumitasu 16.1 17.2
+Added: Ordinary life (1)
Total 100.0 % 100.0 %
−Removed: (1) Includes term life, whole life and Tsumitasu
+Added: (1) Includes term life, whole life and child endowment
The foundation of Aflac Japan's product portfolio has been, and continues to be, third sector products, which include cancer, medical and other products.
−Removed: With continued cost pressure on Japan’s health care system, the Company expects the need for third sector products will continue to rise in the future and that the medical and cancer insurance products Aflac Japan provides will continue to be an important part of its product portfolio.
−Removed: Additionally, the Company believes that sales of first sector products, including Tsumitasu, WAYS and Child Endowment, position Aflac Japan for potential future long-term sales opportunities by marketing these products to a younger demographic as well as potential cross-selling opportunities of Aflac Japan's third sector products.
−Removed: Aflac Japan continues to promote digital and web-based sales to groups and use of its system that enables smart device-based insurance application by allowing the customer and an Aflac Japan operator to see the same screen through their smart devices.
−Removed: Further, Aflac Japan continues to utilize its virtual sales tool that enables online consultations and policy applications to be completed entirely online.
−Removed: The following table details the contributions to Aflac Japan's new annualized premium sales by agency type for the three-month periods ended September 30.
+Added: With continued cost pressure on Japan’s health care system, the Company expects the need for third sector products will continue to rise in the future and that the cancer and medical insurance products Aflac Japan provides will continue to be an important part of its product portfolio.
+Added: Additionally, the Company believes that sales of first sector products, including Tsumitasu and WAYS, position Aflac Japan for potential future long-term sales opportunities by marketing these products to a younger demographic as well as potential cross-selling opportunities of Aflac Japan's third sector products.
+Added: The following table details the contributions to Aflac Japan's new annualized premium sales by agency type for the three-month periods ended March 31.
Independent corporate and individual 52.4 % 52.8 %
2 unchanged sentences
(1) Includes Japan Post Group, Dai-ichi Life and Daido Life
−Removed: During the three-month period ended September 30, 2025, Aflac Japan recruited 73 new sales agencies.
−Removed: At September 30, 2025, Aflac Japan was represented by more than 6,300 sales agencies, with approximately 112,000 licensed sales associates employed by those agencies.
+Added: During the three-month period ended March 31, 2026, Aflac Japan recruited 82 new sales agencies.
+Added: At March 31, 2026, Aflac Japan was represented by approximately 6,200 sales agencies, with approximately 111,000 licensed sales associates employed by those agencies.
The number of sales agencies has declined in recent years due to Aflac Japan's focus on supporting agencies with strong management frameworks, high productivity and more producing agents.
−Removed: At September 30, 2025, Aflac Japan had agreements to sell its products at 358 banks, approximately 90% of the total number of banks in Japan.
+Added: At March 31, 2026, Aflac Japan had agreements to sell its products at 357 banks, approximately 90% of the total number of banks in Japan.
Aflac Japan Investments
−Removed: The level of investment income in yen is affected by available cash flow from operations, the timing of investing the cash flow, yields on new investments, the effect of yen/dollar exchange rates on U.S.
+Added: The level of investment income in Japanese yen is affected by available cash flow from operations, the timing of investing the cash flow, yields on new investments, the effect of yen/dollar exchange rates on U.S.
dollar-denominated investment income and other factors.
−Removed: As part of the Company's portfolio management and asset allocation process, Aflac Japan invests in yen and U.S.
+Added: As part of the Company's portfolio management and asset allocation process, Aflac Japan primarily invests in Japanese yen- and U.S.
dollar-denominated investments.
−Removed: Yen-denominated investments primarily consist of Japan Government Bonds (JGBs), public and private fixed maturity securities and public equity securities.
+Added: Aflac Japan's Japanese yen-denominated investments primarily consist of Japan Government Bonds (JGBs), public and private fixed maturity securities and equity securities.
Aflac Japan's U.S.
1 unchanged sentence
Aflac Japan invests in both publicly traded and privately originated U.S.
−Removed: dollar-denominated investment-grade and below-investment-grade fixed maturity securities and loan receivables, and has entered into foreign currency derivatives to economically hedge the currency risk on the fair value of a portion of the U.S.
−Removed: dollar investments.
+Added: dollar-denominated investment-grade and below-investment-grade fixed maturity securities and loan receivables, and has entered into foreign currency derivatives to economically hedge the foreign currency exchange risk on the fair value of a portion of the U.S.
+Added: dollar-denominated investments.
The following table details the investment purchases for Aflac Japan.
−Removed: Three Months Ended September 30, Nine Months Ended September 30,
+Added: Three Months Ended March 31,
(In millions) 2026 2025
11 unchanged sentences
Infrastructure debt 10 41
−Removed: Collateralized loan obligations 0 0 74 30
−Removed: Equity securities 1 0 1 0
Commercial mortgage and other loans:
7 unchanged sentences
Infrastructure debt 0 52
−Removed: Private placements 0 0 1 0
−Removed: Other fixed maturity securities 0 0 66 0
Commercial mortgage and other loans:
4 unchanged sentences
See the Investments section of this MD&A for further discussion of these investment programs, and see Notes 3 and 4 of the Notes to the Consolidated Financial Statements and Notes 1, 3 and 4 of the Notes to the Consolidated Financial Statements in the 2025 Annual Report for more information regarding loans and loan receivables.
−Removed: The following table presents the results of Aflac Japan’s investment yields for the periods ended September 30.
−Removed: Three Months Nine Months
−Removed: 2025 2024 2025 2024
+Added: The following table presents the results of Aflac Japan’s investment yields for the periods ended and as of March 31.
Total purchases for the period (in millions) (1)
3 unchanged sentences
Return on average invested assets (3)
−Removed: 3.24 3.16 3.20 3.31
Portfolio book yield, including U.S.
5 unchanged sentences
(3) Net of investment expenses and amortized hedge costs, year-to-date number reflected on a quarterly average basis
−Removed: The decrease in the Aflac Japan new money yield in the three- and nine-month periods ended September 30, 2025 was primarily due to lower allocations to higher yielding asset classes.
+Added: The increase in the Aflac Japan new money yield in the three-month period ended March 31, 2026 was primarily due to higher allocations to higher yielding asset classes.
See Notes 3, 4 and 5 of the Notes to the Consolidated Financial Statements and the Investments and Hedging Activities sections of this MD&A for additional information on the Company's investments and hedging strategies.
4 unchanged sentences
Summary of Operating Results
−Removed: Three Months Ended September 30, Nine Months Ended September 30,
+Added: Three Months Ended March 31,
(In millions) 2026 2025
1 unchanged sentence
Adjusted net investment income (1)
−Removed: 214 210 623 634
Other income 23 17
18 unchanged sentences
Pretax adjusted earnings 1.4 .6
−Removed: (1) Net interest income/expense from derivatives associated with certain investment strategies of $(7) and $(9) for the three-month periods and $(19) and $(28) for the nine-month periods ended September 30, 2025 and 2024, respectively, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income.
−Removed: For the three-month period ended September 30, 2025, operating results compared to the same period in the previous year were as follows:
+Added: (1) Net interest income/expense from derivatives associated with certain investment strategies of $(5) and $(6) for the three-month periods ended March 31, 2026 and 2025, respectively, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income.
+Added: For the three-month period ended March 31, 2026, operating results compared to the same period in the previous year were as follows:
• Net earned premiums increased primarily due to improved sales.
−Removed: • Adjusted net investment income increased primarily due to higher variable net investment income.
+Added: • Adjusted net investment income decreased slightly primarily due to lower floating rate income.
• Total adjusted revenues increased primarily due to the increase in net earned premiums.
−Removed: • Total benefits and claims decreased primarily due to $60 million of reserve remeasurement gains related to assumption updates in the third quarter of 2025, compared to reserve remeasurement gains of $11 million in the third quarter of 2024, partially offset by higher incurred claims.
−Removed: • Total adjusted expenses increased primarily due to one-time technology-related expense and higher deferred policy acquisition cost amortization.
−Removed: • Pretax adjusted earnings increased primarily due to the increase in total adjusted revenues and the decrease in total benefits and claims, partially offset by the increase in total adjusted expenses.
−Removed: For the nine-month period ended September 30, 2025, operating results compared to the same period in the previous year were as follows:
−Removed: • Net earned premiums increased primarily due to improved sales.
−Removed: • Adjusted net investment income decreased primarily due to lower floating rate income.
−Removed: • Total adjusted revenues increased primarily due to the increase in net earned premiums, partially offset by the decrease in adjusted net investment income.
−Removed: • Total benefits and claims increased primarily due to higher incurred claims partially offset by $60 million of reserve remeasurement gains related to assumption updates in the third quarter of 2025, compared to reserve remeasurement gains of $11 million in the third quarter of 2024.
−Removed: • Total adjusted expenses increased primarily due to one-time technology-related expense and higher deferred policy acquisition cost amortization.
−Removed: • Pretax adjusted earnings increased primarily due to the increase in total adjusted revenues, partially offset by the increases in total benefits and claims and total adjusted expenses.
−Removed: Annualized premiums in force increased 3.8% to $6.5 billion at September 30, 2025, compared with $6.3 billion at September 30, 2024.
+Added: • Total benefits and claims increased primarily due to higher incurred claims for certain group products largely associated with the growth in net earned premiums, partially offset by higher reserve remeasurement gains.
+Added: • Total adjusted expenses increased primarily due to higher variable expenses associated with the growth in net earned premiums.
+Added: • Pretax adjusted earnings increased primarily due to the increase in total adjusted revenues, partially offset by the increases in total adjusted expenses and total benefits and claims.
+Added: Annualized premiums in force increased 4.6% to $6.8 billion at March 31, 2026, compared with $6.5 billion at March 31, 2025.
The following table presents a summary of operating ratios for Aflac U.S.
−Removed: followed by a discussion of the significant drivers of changes in operating ratios compared to the same periods in the previous year.
−Removed: Three Months Ended September 30, Nine Months Ended September 30,
+Added: followed by a discussion of the significant drivers of changes in operating ratios compared to the same period in the previous year.
+Added: Three Months Ended March 31,
Ratios to total adjusted revenues:
−Removed: 2025 2024 2025 2024
Total benefits and claims 41.3 % 41.6 %
9 unchanged sentences
Amortization of deferred policy acquisition costs 9.2 9.1
−Removed: • For the three-month period ended September 30, 2025, the total benefits and claims to total premiums ratio decreased primarily due to reserve remeasurement gains related to assumption updates in the third quarter of 2025.
−Removed: For the nine-month period ended September 30, 2025, the total benefits and claims to total premiums ratio was flat.
−Removed: • For the three-month period ended September 30, 2025, the total adjusted expense ratio increased primarily due to one-time technology-related expenses.
−Removed: The total adjusted expense ratio decreased in the nine-month period ended September 30, 2025 primarily due to expense efficiency efforts.
−Removed: • In total, the pretax adjusted profit margin increased in the three-month period ended September 30, 2025, primarily due to the lower benefit ratio.
−Removed: The pretax adjusted profit margin increased in the nine-month period ended September 30, 2025 primarily due to the lower total adjusted expense ratio.
+Added: • For the three-month period ended March 31, 2026, the total benefits and claims to total premiums ratio decreased primarily due to higher net earned premiums as well as higher reserve remeasurement gains.
+Added: • For the three-month period ended March 31, 2026, the total adjusted expense ratio increased primarily due to higher total adjusted expenses associated with the growth in net earned premiums.
+Added: • In total, the pretax adjusted profit margin decreased in the three-month period ended March 31, 2026, primarily due to the higher expense ratio, partially offset by the lower benefit ratio.
The following table presents premium persistency for Aflac U.S.
−Removed: on a 12-month rolling basis as of September 30.
+Added: on a 12-month rolling basis as of March 31.
Premium persistency 79.3 % 79.3 %
The following table presents Aflac's U.S.
−Removed: new annualized premium sales for the periods ended September 30.
−Removed: Three Months Nine Months
+Added: new annualized premium sales for the periods ended March 31.
(In millions) 2026 2025
2 unchanged sentences
The increase in new annualized premium sales for Aflac U.S.
−Removed: in the third quarter and first nine months of 2025 was primarily driven by sales of group products.
+Added: in the first quarter of 2026 was primarily driven by sales of group products.
The following table details the contributions to Aflac's U.S.
−Removed: new annualized premium sales by major insurance product category for the periods ended September 30.
−Removed: Three Months Nine Months
−Removed: 2025 2024 2025 2024
+Added: new annualized premium sales by major insurance product category for the periods ended March 31.
Accident 19.8 % 21.1 %
1 unchanged sentence
Critical care (1)
−Removed: 15.9 18.6 18.9 20.5
Hospital indemnity 13.5 15.0
3 unchanged sentences
(1) Includes cancer, critical illness, and hospital intensive care products
−Removed: In the third quarter of 2025, the Aflac U.S.
+Added: In the first quarter of 2026, the Aflac U.S.
sales force included an average of approximately 5,000 U.S.
3 unchanged sentences
As part of the Company's portfolio management and asset allocation process, Aflac U.S.
−Removed: invests in fixed maturity investments, loan receivables, and growth assets, including public equity securities and alternative investments in limited partnerships.
+Added: invests in fixed maturity securities, loan receivables and growth assets, including equity securities and alternative investments in limited partnerships.
invests in both publicly traded and privately originated investment-grade and below-investment-grade fixed maturity securities and loan receivables.
The following table details the investment purchases for Aflac U.S.
−Removed: Three Months Ended September 30, Nine Months Ended September 30,
+Added: Three Months Ended March 31,
(In millions) 2026 2025
3 unchanged sentences
Infrastructure debt 0 2
−Removed: Collateralized loan obligations 0 0 25 12
Equity securities 0 6
5 unchanged sentences
Other investments:
+Added: Limited partnerships 39 14
dollar-denominated 719 507
6 unchanged sentences
The following table presents the results of Aflac's U.S.
−Removed: investment yields for the periods ended September 30.
−Removed: Three Months Nine Months
−Removed: 2025 2024 2025 2024
+Added: investment yields for the periods ended and as of March 31.
Total purchases for period (in millions) (1)
−Removed: $ 155 $ 158 $ 974 $ 886
New money yield (1),(2)
1 unchanged sentence
Return on average invested assets (3)
−Removed: 5.07 4.94 4.96 5.00
Portfolio book yield, end of period (1),(2)
4 unchanged sentences
(3) Net of investment expenses, year-to-date number reflected on a quarterly average basis
−Removed: The increase in the Aflac U.S.
−Removed: new money yield in the three-month period ended September 30, 2025 was primarily due to higher long-term rates and a larger allocation to higher yielding asset classes.
The decrease in the Aflac U.S.
−Removed: new money yield in the nine-month period ended September 30, 2025 was primarily due to lower short-term rates on floating rate assets.
+Added: new money yield in the three-month period ended March 31, 2026 was primarily due to lower rates on fixed and floating rate assets.
See Notes 3 and 5 of the Notes to the Consolidated Financial Statements and the Investments section of this MD&A for additional information on the Company's investments.
CORPORATE AND OTHER
−Removed: Changes in the pretax adjusted earnings of Corporate and other are primarily affected by internal reinsurance activity and net investment income.
+Added: Changes in the pretax adjusted earnings of Corporate and other are primarily affected by reinsurance activity and net investment income.
The following table presents a summary of operating results for Corporate and other.
Corporate and Other Summary of Operating Results
−Removed: Three Months Ended September 30, Nine Months Ended September 30,
+Added: Three Months Ended March 31,
(In millions) 2026 2025
1 unchanged sentence
Net investment income (loss) (1)
−Removed: 110 39 304 146
Amortized hedge income 18 30
19 unchanged sentences
Pretax adjusted earnings (100.0) 1533.3
−Removed: (1) The change in value of federal historic rehabilitation and solar investments in partnerships of $6 and $57 for the three-month periods and $22 and $119 for the nine-month periods ended September 30, 2025 and 2024, respectively, is included as a reduction to net investment income.
−Removed: Tax credits on these investments of $7 and $78 for the three-month periods and $24 and $142 for the nine-month periods ended September 30, 2025 and 2024, respectively, have been recorded as an income tax benefit in the consolidated statements of earnings.
−Removed: See Note 3 of the Notes to the Consolidated Financial Statements for additional information on these investments.
−Removed: For the three-month period ended September 30, 2025, operating results compared to the same period in the previous year were as follows:
−Removed: • Net earned premiums and total benefits and claims increased primarily due to higher internal reinsurance activity resulting from the transaction established in the fourth quarter of 2024.
−Removed: The increase in total benefits and claims was partially offset by $31 million of reserve remeasurement gains related to assumption updates in the third quarter of 2025, compared to reserve remeasurement gains of $20 million in the third quarter of 2024.
−Removed: • Adjusted net investment income increased primarily due to $51 million from a lower volume of federal historic rehabilitation and solar tax credit investments, with offsetting tax benefits recognized as a corresponding lower income tax expense, and higher Aflac Re consolidated investment income of $11 million from a higher volume of assets as part of the reinsurance agreement established in the fourth quarter of 2024.
−Removed: • Total adjusted revenues increased primarily due to the increases in adjusted net investment income and net earned premiums.
−Removed: • Total adjusted expenses increased primarily due to $16 million associated with internal reinsurance activity, higher interest expense of $16 million, and $7 million from higher costs pertaining to business operations, including costs
−Removed: related to the ongoing investigation of and response to the cybersecurity incident and legal and other professional services related thereto.
−Removed: • Pretax adjusted earnings increased primarily due to the increase in total adjusted revenues, partially offset by the increase in total benefits and adjusted expenses.
−Removed: For the nine-month period ended September 30, 2025, operating results compared to the same period in the previous year were as follows:
−Removed: • Net earned premiums and total benefits and claims increased primarily due to higher internal reinsurance activity resulting from the transaction established in the fourth quarter of 2024.
−Removed: The increase in total benefits and claims was partially offset by $31 million of reserve remeasurement gains related to assumption updates in the third quarter of 2025, compared to reserve remeasurement gains of $20 million in the third quarter of 2024.
−Removed: • Adjusted net investment income increased primarily due to $97 million from a lower volume of federal historic rehabilitation and solar tax credit investments, with offsetting tax benefits recognized as a corresponding lower income tax expense, and higher Aflac Re consolidated investment income of $35 million from a higher volume of assets as part of the reinsurance agreement established in the fourth quarter of 2024.
−Removed: • Total adjusted revenues increased primarily due to the increases in adjusted net investment income and net earned premiums.
−Removed: • Total adjusted expenses increased primarily due to $39 million associated with internal reinsurance activity, higher interest expense of $38 million, and $34 million from higher costs pertaining to business operations, including costs related to the ongoing investigation of and response to the cybersecurity incident and legal and other professional services related thereto.
−Removed: • Pretax adjusted earnings increased primarily due to the increase in total adjusted revenues, partially offset by the increase in total benefits and adjusted expenses.
+Added: (1) The change in value of federal historic rehabilitation and solar investments in partnerships of $5 and $8 for the three-month periods ended March 31, 2026 and 2025, respectively, is included as a reduction to net investment income.
+Added: Tax credits on these investments of $5 and $7 for the three-month periods ended March 31, 2026 and 2025, respectively, have been reported as an income tax benefit in the consolidated statements of earnings.
+Added: See Note 1 of the Notes to the Consolidated Financial Statements in the 2025 Annual Report for additional information on these investments.
+Added: For the three-month period ended March 31, 2026, operating results compared to the same period in the previous year were as follows:
+Added: • Net earned premiums and total benefits and claims decreased primarily due to reinsurance activity.
+Added: • Adjusted net investment income decreased primarily due to lower amortized hedge income.
+Added: • Total adjusted revenues decreased primarily due to the decreases in adjusted net investment income and net earned premiums.
+Added: • Total adjusted expenses increased primarily due to higher interest expense and higher costs pertaining to business operations.
+Added: • Pretax adjusted earnings decreased primarily due to lower total adjusted revenues and higher total adjusted expenses, partially offset by lower total benefits and claims.
The Parent Company invests in partnerships that specialize in rehabilitating historic structures or the installation of solar equipment in order to receive federal historic rehabilitation and solar tax credits.
These investments are classified as limited partnerships and included in other investments in the consolidated balance sheets.
−Removed: The change in value of each investment is recorded as a reduction to net investment income.
−Removed: Tax credits generated by these investments are recorded as an income tax benefit in the consolidated statements of earnings.
+Added: The change in value of each
+Added: investment is reported as a reduction to net investment income.
+Added: Tax credits generated by these investments are reported as an income tax benefit in the consolidated statements of earnings.
The Company’s investment strategy utilizes disciplined asset and liability management while seeking long-term risk-adjusted investment returns and the delivery of stable income within regulatory and capital objectives, and preserving shareholder value.
−Removed: In attempting to optimally balance these objectives, the Company seeks to maintain on behalf of Aflac Japan a diversified portfolio of yen-denominated investment assets, a U.S.
−Removed: dollar-denominated investment portfolio hedged back to yen and a portfolio of unhedged U.S.
+Added: In attempting to optimally balance these objectives, the Company seeks to maintain on behalf of Aflac Japan a diversified portfolio of Japanese yen-denominated investment assets, a U.S.
+Added: dollar-denominated investment portfolio hedged back to Japanese yen and a portfolio of unhedged U.S.
dollar-denominated assets.
As part of the Company's portfolio management and asset allocation process, Aflac U.S.
−Removed: invests in fixed maturity investments and growth assets, including public equity securities and alternative investments in limited partnerships.
+Added: invests in fixed maturity securities and growth assets, including equity securities and alternative investments in limited partnerships.
invests in both publicly traded and privately originated investment-grade and below-investment-grade fixed maturity securities and loans.
2 unchanged sentences
Investment Securities by Segment
−Removed: September 30, 2025
+Added: March 31, 2026
(In millions) Aflac Japan Aflac U.S.
Corporate and Other Total
−Removed: Available-for-sale, fixed maturity securities,
+Added: Fixed maturity securities available-for-sale,
at fair value $ 43,812 $ 12,535 $ 6,881 $ 63,228
−Removed: Held-to-maturity, fixed maturity securities,
+Added: Fixed maturity securities held-to-maturity,
at amortized cost (1)
24 unchanged sentences
Corporate and Other Total
−Removed: Available-for-sale, fixed maturity securities,
+Added: Fixed maturity securities available-for-sale,
at fair value $ 44,782 $ 12,426 $ 6,913 $ 64,121
−Removed: Held-to-maturity, fixed maturity securities,
+Added: Fixed maturity securities held-to-maturity,
at amortized cost (1)
29 unchanged sentences
The Company works with the affected borrowers to resolve specific situations through loan continuance with potential modifications, through loan sales, or through the process of foreclosure or deed in lieu of foreclosure.
−Removed: Since the third quarter of 2023, the Company has taken possession, through foreclosure or deed in lieu of foreclosure, of certain commercial real estate properties, which secured defaulted loans.
+Added: In recent years, the Company has taken possession, through foreclosure or deed in lieu of foreclosure, of certain commercial real estate properties, which secured defaulted loans.
Properties acquired by the Company through foreclosure and deed in lieu of foreclosure are reported as real estate owned (REO) in other investments in the Company's consolidated balance sheets.
−Removed: In the nine-month period ended September 30, 2025, the Company completed foreclosure or deed in lieu of foreclosure on TREs collateralized with commercial real estate properties with an amortized cost of $257 million.
−Removed: As a result of the amortized cost of the TREs exceeding the estimated fair value of the collateral upon consummating the foreclosures or deed in lieu of foreclosure transactions, the Company recognized a net loss of $10 million in net investment gains (losses) for the nine-month period ended September 30, 2025.
−Removed: In the nine-month period ended September 30, 2024, the Company completed foreclosure or deed in lieu of foreclosure on TREs collateralized with commercial real estate properties with an amortized cost of $407 million.
−Removed: As a result of the amortized cost of the TREs exceeding the estimated fair value of the collateral upon consummating the foreclosures or deed in lieu of foreclosure transactions, the Company recognized a net loss of $27 million in net investment gains (losses) for the nine-month period ended September 30, 2024.
+Added: In the three-month period ended March 31, 2026, the Company did not complete any foreclosure or deed in lieu of foreclosure transactions.
+Added: In the three-month period ended March 31, 2025, the Company completed foreclosure or deed in lieu of foreclosure on TREs collateralized with commercial real estate properties with an amortized cost of $87 million.
+Added: As a result of the amortized cost of the TREs exceeding the estimated fair value of the collateral upon consummating the foreclosures or deed in lieu of foreclosure transactions, the Company recognized a net loss of $16 million in net investment gains (losses) for the three-month period ended March 31, 2025.
The Company utilizes third-party asset managers to source, underwrite and manage each loan, as well as any resulting REO.
4 unchanged sentences
See also Item 1A.
−Removed: Risk Factors of the 2024 Annual Report for a discussion of risk factors associated with the Company's investments.
+Added: Risk Factors in the 2025 Annual Report for a discussion of risk factors associated with the Company's investments.
The ratings of the Company's securities referenced in the table below are based on the ratings designations provided by major rating organizations such as Moody's, Standard & Poor's and Fitch or, if not rated, are determined based on the Company's internal analysis of such securities.
2 unchanged sentences
Composition of Fixed Maturity Securities by Credit Rating
−Removed: September 30, 2025 December 31, 2024
+Added: March 31, 2026 December 31, 2025
Value Amortized
5 unchanged sentences
Total 100.0 % 100.0 % 100.0 % 100.0 %
−Removed: As of September 30, 2025, the Company's direct and indirect exposure to securities in its investment portfolio that were guaranteed by third parties was immaterial both individually and in the aggregate.
−Removed: The following table presents the 10 largest unrealized loss positions in the Company's portfolio as of September 30, 2025.
+Added: As of March 31, 2026, the Company's direct and indirect exposure to securities in its investment portfolio that were guaranteed by third parties was immaterial both individually and in the aggregate.
+Added: The following table presents the 10 largest unrealized loss positions in the Company's portfolio as of March 31, 2026.
(In millions) Credit
3 unchanged sentences
Urban Renaissance Agency A+ 153 84 (69)
−Removed: KLM Royal Dutch Airlines B+ 134 93 (41)
−Removed: JP Morgan Chase and Co.
+Added: JPMorgan Chase & Co.
A+ 192 149 (43)
−Removed: Thames Water Utility CCC- 134 97 (37)
+Added: KLM Royal Dutch Airlines B+ 125 84 (41)
+Added: Lubrizol Corporation AA 214 174 (40)
Mitsubishi Estate Co Ltd.
A 125 87 (38)
−Removed: Tokyo Gas Co Ltd A+ 101 69 (32)
Prologis LP A 142 105 (37)
West Japan Railway Company A+ 100 63 (37)
−Removed: SNCF Reseau AA- 73 44 (29)
+Added: Japan Expressway Holding and Debt A+ 226 189 (37)
+Added: Tokyo Gas Co Ltd A+ 94 58 (36)
Generally, declines in fair values can be a result of changes in interest rates, yen/dollar exchange rate, and changes in net spreads driven by a broad market move or a change in the issuer's underlying credit quality.
2 unchanged sentences
Below-Investment-Grade Securities
−Removed: The Company's portfolio of below-investment-grade securities includes debt securities purchased while the issuer was rated investment grade plus other loans and bonds invested in as part of an allocation to that segment of the market.
+Added: The Company's portfolio of below-investment-grade securities includes fixed maturity securities purchased while the issuer was rated investment grade plus other loans and bonds invested in as part of an allocation to that segment of the market.
The following is the Company's below-investment-grade exposure.
Below-Investment-Grade Investments
−Removed: September 30, 2025
+Added: March 31, 2026
(In millions) Par
4 unchanged sentences
138 137 125 (12)
−Removed: Thames Water Utility 135 134 97 (37)
−Removed: KLM Royal Dutch Airlines 134 134 93 (41)
Telecom Italia SpA 125 125 157 32
+Added: KLM Royal Dutch Airlines 125 125 84 (41)
IKB Deutsche Industriebank AG 81 46 64 18
+Added: Anpac Spa (Project Neptune) 37 35 33 (2)
+Added: Carbonfree Chile Series A 36 33 30 (3)
+Added: Paramount Global 35 27 21 (6)
Amarok Parent LLC 25 22 25 3
−Removed: CPI Property Group SA 20 20 19 (1)
−Removed: Tralka Spa (Chadwick) 18 19 17 (2)
Other Issuers 87 86 80 (6)
15 unchanged sentences
The following table shows the distribution of fixed maturities by sector classification.
−Removed: September 30, 2025
+Added: March 31, 2026
(In millions) Amortized
28 unchanged sentences
Investment Securities by Type of Issuance
−Removed: September 30, 2025 December 31, 2024
+Added: March 31, 2026 December 31, 2025
(In millions) Amortized
11 unchanged sentences
(1) Net of allowance for credit losses
−Removed: (2) Primarily consists of securities owned by Aflac Japan
+Added: (2) Primarily consists of securities held by Aflac Japan
(3) Excludes Rule 144A securities
1 unchanged sentence
Reverse Dual-Currency Securities (1)
−Removed: (Amortized cost, in millions) September 30,
+Added: (Amortized cost, in millions) March 31,
2026 December 31,
4 unchanged sentences
securities 4.9 % 5.0 %
−Removed: (1) Principal payments in yen and interest payments in dollars
+Added: (1) Principal payments in Japanese yen and interest payments in U.S.
Aflac Japan has a portfolio of privately issued securities to better match liability characteristics and secure higher yields than those available on Japanese government or other public corporate bonds.
−Removed: Aflac Japan’s investments in yen-denominated privately issued securities consist primarily of non-Japanese issuers, are rated investment grade at purchase and have longer maturities, thereby allowing the Company to improve asset/liability matching and overall investment returns.
+Added: Aflac Japan’s investments in Japanese yen-denominated privately issued securities consist primarily of non-Japanese issuers, are rated investment grade at purchase and have longer maturities, thereby allowing the Company to improve asset/liability matching and overall investment returns.
These securities are generally either privately negotiated arrangements or issued under medium-term note programs and have standard documentation commensurate with credit ratings of the issuer, except when internal credit analysis indicates that additional protective and/or event-risk covenants were required.
2 unchanged sentences
HEDGING ACTIVITIES
−Removed: The Company uses derivative contracts to hedge foreign currency exchange rate risk and interest rate risk.
+Added: The Company uses derivative contracts to hedge foreign currency exchange risk and interest rate risk.
The Company uses various strategies, including derivatives, to manage these risks.
Quantitative and Qualitative Disclosures About Market Risk in the 2025 Annual Report for more information about market risk and the Company’s use of derivatives.
−Removed: Derivatives are designed to reduce risk on an economic basis while minimizing the impact on financial results.
−Removed: The Company’s derivatives programs vary depending on the type of risk being hedged.
See Note 4 of the Notes to the Consolidated Financial Statements for:
2 unchanged sentences
• Impact on earnings and other comprehensive income (loss) from various qualifying and non-qualifying hedging relationships.
−Removed: Foreign Currency Exchange Rate Risk Hedge Program
−Removed: The Company has deployed the following hedging strategies to mitigate exposure to foreign currency exchange rate risk:
+Added: Foreign Currency Exchange Risk Hedge Program
+Added: The Company has deployed the following hedging strategies to mitigate exposure to foreign currency exchange risk:
• Aflac Japan hedges U.S.
−Removed: dollar-denominated investments back to yen (see Aflac Japan’s U.S.
+Added: dollar-denominated investments back to Japanese yen (see Aflac Japan’s U.S.
Dollar-Denominated Hedge Program below).
• Aflac Japan maintains certain unhedged U.S.
−Removed: dollar-denominated securities, which serve as an economic currency hedge of a portion of the Company's investment in Aflac Japan, while utilizing foreign currency options to mitigate against significant movements in the yen/U.S.
−Removed: dollar exchange rate (see Aflac Japan’s U.S.
+Added: dollar-denominated securities, which serve as an economic currency hedge of a portion of the Company's investment in Aflac Japan, while utilizing foreign currency options to mitigate against significant movements in the yen/dollar exchange rate (see Aflac Japan’s U.S.
Dollar-Denominated Hedge Program below).
−Removed: • Aflac Japan uses foreign currency swaps to economically hedge the foreign exchange rate risk on certain of its investments that are denominated in other foreign currencies.
−Removed: • The Parent Company designates yen-denominated liabilities (notes payable and loans) as non-derivative hedging instruments and designates certain foreign currency forwards and options as derivative hedges of the Company’s net investment in Aflac Japan ( see Enterprise Corporate Hedging Program below) .
−Removed: • The Parent Company enters into forward and option contracts to accomplish a dual objective of hedging foreign currency exchange rate risk related to dividend payments by its subsidiary, ALIJ, and reducing enterprise-wide hedge costs ( see Enterprise Corporate Hedging Program below ).
−Removed: The following table presents metrics related to Aflac Japan's U.S.
−Removed: dollar-denominated hedge program and the Parent Company's enterprise corporate hedging program, including associated amortized hedge costs/income, for the periods ended September 30.
+Added: • Aflac Japan economically hedges the foreign currency exchange risk on certain of its investments that are denominated in other foreign currencies.
+Added: • The Parent Company designates Japanese yen-denominated liabilities (notes payable and loans) as non-derivative hedging instruments and designates certain foreign currency forwards and options as derivative hedges of the Company’s net investment in Aflac Japan ( see Enterprise Corporate Hedging Program below) .
+Added: • The Parent Company enters into forward and option contracts to protect the value of Aflac Japan in U.S.
+Added: dollar terms by hedging foreign currency exchange risk related to dividend payments by Aflac Japan and reduce enterprise-wide hedge costs ( see Enterprise Corporate Hedging Program below ).
+Added: The following table presents metrics related to the Company's Foreign Currency Exchange Risk Hedge Program, including associated amortized hedge costs/income, for the periods ended March 31.
See the Results of Operations section of this MD&A for the Company's definition of amortized hedge costs/income.
−Removed: Three Months Nine Months
−Removed: 2025 2024 2025 2024
FX forward notional at end of period (in billions) (1)
−Removed: $ 0.7 $ 0.0 $ 0.7 $ 0.0
Amortized hedge income (cost) for period (in millions) $ (7) $ 0
4 unchanged sentences
FX forward notional at end of period (in billions) (1)
−Removed: $ 1.8 $ 1.9 $ 1.8 $ 1.9
Amortized hedge income (cost) for period (in millions) $ 18 $ 30
FX option notional at the end of period (in billions) (1)
−Removed: $ 0.0 $ 0.0 $ 0.0 $ 0.0
Amortized hedge income (cost) for period (in millions) $ 0 $ 0
(1) Notional is reported net of any offsetting positions within Aflac Japan or the Parent Company, respectively.
−Removed: Amortized hedge costs/income can fluctuate based upon many factors, including the derivative notional amount, the length of time of the derivative contract, changes in both U.S.
−Removed: and Japan interest rates, and supply and demand for U.S.
−Removed: dollar funding.
+Added: Amortized hedge costs/income can fluctuate based upon many factors, including the derivative notional amount, the length of time of the derivative contract, implied volatility, changes in both U.S.
+Added: and Japan interest rates, and the cross-currency basis.
Amortized hedge costs/income have fluctuated in recent periods due to changes in the previously mentioned factors.
3 unchanged sentences
Aflac Japan buys U.S.
−Removed: dollar-denominated investments, typically corporate bonds, and hedges them back to yen with foreign currency forwards and options to hedge foreign currency exchange rate risk.
−Removed: This economically creates yen assets that match yen liabilities during the life of the derivative and provides favorable capital treatment under the Japan solvency margin ratio (SMR) calculations.
+Added: dollar-denominated investments, typically corporate bonds, and hedges them back to Japanese yen with foreign currency forwards and options to hedge foreign currency exchange risk.
+Added: This economically creates Japanese yen assets that match Japanese yen liabilities during the life of the derivative.
The currency risk being hedged is generally based on fair value of hedged investments.
1 unchanged sentence
dollar-denominated investments held by Aflac Japan.
−Removed: September 30,
2026 December 31,
16 unchanged sentences
Dollar Program includes all U.S.
−Removed: dollar-denominated investments in Aflac Japan other than the investments in certain consolidated VIEs where the instrument is economically converted to yen as a result of a derivative in the consolidated VIE.
−Removed: The Company uses foreign currency forwards to hedge foreign exchange risk on certain U.S.
−Removed: dollar-denominated investments in Aflac Japan's portfolio and one-sided foreign currency put options to mitigate the settlement risk on U.S.
−Removed: dollar-denominated assets related to extreme foreign currency rate changes.
+Added: dollar-denominated investments held by Aflac Japan other than the investments in certain consolidated variable interest entities (VIEs) where the instrument is economically converted to Japanese yen as a result of a derivative in the consolidated VIE.
+Added: The Company uses foreign currency forwards to hedge foreign currency exchange risk on certain U.S.
+Added: dollar-denominated investments held by Aflac Japan and one-sided foreign currency put options to mitigate the risk of a decline in the value of U.S.
+Added: dollar-denominated assets (in Japanese yen terms) related to extreme foreign exchange rate changes.
From time to time, Aflac Japan also maintains a collar program on a portion of its U.S.
−Removed: Dollar Program to mitigate against more extreme moves in foreign exchange and therefore support SMR.
−Removed: As of September 30, 2025, none of the Company's foreign currency options hedging Aflac Japan's U.S.
+Added: Dollar Program to mitigate against more extreme moves in foreign exchange rates.
+Added: As of March 31, 2026, none of the Company's foreign currency options hedging Aflac Japan's U.S.
dollar-denominated assets were in-the-money.
−Removed: Foreign exchange derivatives used for hedging are periodically settled, which results in cash receipt or payment at inception, maturity or early termination.
−Removed: The following table presents the settlements associated with the Company's currency derivatives used for hedging Aflac Japan’s U.S.
+Added: Foreign currency derivatives used for hedging are periodically settled, which results in cash receipt or payment at inception, maturity or early termination.
+Added: The following table presents the settlements associated with the Company's foreign currency derivatives used for hedging Aflac Japan’s U.S.
dollar-denominated investments.
−Removed: Three Months Ended September 30, Nine Months Ended September 30,
+Added: Three Months Ended March 31,
(In millions) 2026 2025
1 unchanged sentence
In addition to the U.S.
−Removed: Dollar Program, Aflac Japan also utilizes foreign currency swaps to economically hedge the foreign exchange rate risk on certain investments denominated in other foreign currencies.
−Removed: As of September 30, 2025, the Company had foreign currency swaps on other foreign currency-denominated investments with a fair value of $48 million.
+Added: Dollar Program, Aflac Japan utilizes foreign currency forwards to economically hedge the foreign currency exchange risk on certain of its variable-rate investments denominated in other foreign currencies.
+Added: As of March 31, 2026, the Company had foreign currency forwards on other foreign currency-denominated investments with a fair value of $130 million.
+Added: Aflac Japan also utilizes foreign currency swaps to economically hedge the foreign currency exchange risk on certain of its fixed maturity securities denominated in other foreign currencies.
+Added: As of March 31, 2026, the Company had foreign currency swaps on other foreign currency-denominated investments with a fair value of $47 million.
Enterprise Corporate Hedging Program
−Removed: The Company has designated certain yen-denominated liabilities and foreign currency forwards and options of the Parent Company as accounting hedges of its net investment in Aflac Japan.
−Removed: The Company's consolidated yen-denominated net asset position was partially hedged at $7.1 billion as of September 30, 2025, with hedging instruments comprised of $5.3 billion of yen-denominated debt and $1.8 billion of foreign currency forwards, compared with $5.9 billion as of December 31, 2024, with hedging instruments comprised of $4.1 billion of yen-denominated debt and $1.8 billion of foreign currency forwards .
+Added: The Company has designated certain Japanese yen-denominated liabilities and foreign currency forwards and options of the Parent Company as accounting hedges of its net investment in Aflac Japan.
+Added: The Company's consolidated Japanese yen-denominated net asset position was partially hedged at $7.0 billion as of March 31, 2026, with hedging instruments comprised of $4.9 billion of Japanese yen-denominated debt and $2.1 billion of foreign currency forwards, compared with $6.8 billion as of December 31, 2025, with hedging instruments comprised of $5.0 billion of Japanese yen-denominated debt and $1.8 billion of foreign currency forwards .
The Company makes its accounting designation of net investment hedge at the beginning of each quarter.
−Removed: If the total of the designated Parent Company non-derivative and derivative notional is equal to or less than the Company's net investment in Aflac Japan, the hedge is deemed to be effective, and the currency exchange effect on the yen-denominated liabilities and the change in estimated fair value of the derivatives are reported in the unrealized foreign currency component of other comprehensive income.
−Removed: The Company's net investment hedge was effective during the three- and nine-month periods ended September 30, 2025 and 2024, respectively.
+Added: If the total of the designated Parent Company non-derivative and derivative notional is equal to or less than the Company's net investment in Aflac Japan, the hedge is deemed to be effective, and the foreign currency exchange effect on the Japanese yen-denominated liabilities and the change in estimated fair value of the derivatives are included in unrealized foreign currency translation gains (losses) in the consolidated statements of comprehensive income (loss).
+Added: The Company's net investment hedge was effective during the three-month periods ended March 31, 2026 and 2025, respectively.
For additional information on the Company's net investment hedging strategy, see Note 4 of the Notes to the Consolidated Financial Statements.
−Removed: In order to economically mitigate risks associated with the enterprise-wide exposure to the yen and the level and volatility of hedge costs, the Parent Company enters into foreign currency forward and option contracts.
+Added: In order to economically mitigate risks associated with the enterprise-wide exposure to the Japanese yen and the level and volatility of hedge costs, the Parent Company enters into foreign currency forward and option contracts.
By buying U.S.
−Removed: dollars and selling yen, the Parent Company is effectively lowering its overall economic exposure to the yen.
−Removed: In addition to reducing yen exposure from dividend payments by Aflac Japan to the Parent Company, this strategy also reduces enterprise-wide hedge costs.
+Added: dollars and selling Japanese yen, the Parent Company is effectively lowering its overall economic exposure to the Japanese yen.
+Added: In addition to reducing Japanese yen exposure from dividend payments by Aflac Japan to the Parent Company, this strategy also reduces enterprise-wide hedge costs.
This activity is reported in Corporate and other.
The Company continually evaluates the program’s efficacy.
−Removed: As part of the Company’s internal reinsurance platform, Aflac Re enters into foreign currency forwards with the Parent Company, and may enter into such forwards with third parties, to economically manage the currency mismatch between Aflac Re's assets, which are mostly denominated in U.S.
−Removed: dollars, and liabilities, which are mostly denominated in yen, in order to support and optimize Bermuda Monetary Authority (BMA) capital requirements.
−Removed: For additional information on the Company's internal reinsurance platform, see Note 8 of the Notes to the Consolidated Financial Statements and the Liquidity and Capital Resources section of this MD&A and Note 8 of the Notes to the Consolidated Financial Statements in the 2024 Annual Report.
+Added: As part of the Company’s reinsurance platform, Aflac Re enters into foreign currency forwards with the Parent Company, and may enter into such forwards with third parties, to economically manage the currency mismatch between Aflac Re's assets, which are mostly denominated in U.S.
+Added: dollars, and its liabilities, which are mostly denominated in Japanese yen, in order to support and optimize Bermuda Monetary Authority (BMA) capital requirements.
+Added: For additional information on the Company's reinsurance platform, see Note 8 of the Notes to the Consolidated Financial Statements and the Liquidity and Capital Resources section of this MD&A and Note 8 of the Notes to the Consolidated Financial Statements in the 2025 Annual Report.
+Added: For additional discussion of the risks associated with the foreign currency exposure refer to the Currency Risk section in Item 7A., Quantitative and Qualitative Disclosures about Market Risk, and Item 1A, specifically to the Risk Factors titled “The Company is exposed to foreign currency fluctuations in the yen/dollar exchange rate" and “Lack of availability of acceptable yen-denominated investments could adversely affect the Company's results of operations, financial position or liquidity" in the 2025 Annual Report.
Interest Rate Risk Hedge Program
3 unchanged sentences
dollar-denominated investments held by Aflac Japan, from time to time the Company utilizes interest rate swaptions.
−Removed: For additional discussion of the risks associated with the foreign currency exposure refer to the Currency Risk section in Item 7A., Quantitative and Qualitative Disclosures about Market Risk, and Item 1A, specifically to the Risk Factors titled “The Company is exposed to foreign currency fluctuations in the yen/dollar exchange rate" and “Lack of availability of acceptable yen-denominated investments could adversely affect the Company's results of operations, financial position or liquidity" in the 2024 Annual Report.
See Note 4 of the Notes to the Consolidated Financial Statements for additional information on the Company's hedging activities.
−Removed: DEFERRED POLICY ACQUISITION COSTS
−Removed: The following table presents deferred policy acquisition costs (DAC) by segment.
−Removed: (In millions) September 30,
−Removed: 2025 December 31,
−Removed: 2024 % Change
−Removed: Aflac Japan $ 5,523 $ 5,102 8.3 % (1)
−Removed: 3,693 3,656 1.0
−Removed: Total $ 9,216 $ 8,758 5.2 %
−Removed: (1) Aflac Japan’s deferred policy acquisition costs increased 1.9% in yen during the nine months ended September 30, 2025.
−Removed: See Note 6 of the Notes to the Consolidated Financial Statements for additional information on the Company's deferred policy acquisition costs.
POLICY LIABILITIES
−Removed: The following table presents policy liabilities by segment.
−Removed: (In millions) September 30,
+Added: The following table presents policy liabilities by segment and in total.
+Added: (In millions) March 31,
2026 December 31,
6 unchanged sentences
Total $ 66,782 $ 69,583 (4.0) %
−Removed: (1) Aflac Japan’s policy liabilities decreased 10.2% in yen during the nine months ended September 30, 2025.
+Added: (1) Aflac Japan’s policy liabilities decreased 3.5% in yen during the three months ended March 31, 2026.
(2) Elimination entry necessary due to the internal reinsurance transactions with Aflac Re and to recapture of a portion of policy liabilities ceded externally as a result of the reinsurance retrocession transaction.
13 unchanged sentences
As a result, additional contributions are not expected to be required unless the balance is reduced due to payments made by the LIPPC to the policyholders of insolvent insurers.
−Removed: Accordingly, Aflac Japan did not recognize an expense for LIPPC assessments for the nine-month periods ended September 30, 2025 and September 30, 2024.
+Added: Accordingly, Aflac Japan did not recognize an expense for LIPPC assessments for the three-month periods ended March 31, 2026 and March 31, 2025.
Guaranty Fund Assessments
1 unchanged sentence
The amount of the guaranty fund assessment that an insurer is assessed is based on its proportionate share of premiums in that state.
−Removed: Guaranty fund assessments for the three- and nine-month periods ended September 30, 2025 and 2024 were immaterial.
+Added: Guaranty fund assessments for the three-month periods ended March 31, 2026 and 2025 were immaterial.
LIQUIDITY AND CAPITAL RESOURCES
8 unchanged sentences
• a constantly evolving business and economic environment
−Removed: • a balanced approach to capital allocation and shareholder deployment.
+Added: • a balanced approach to capital allocation and deployment to shareholders
The governance framework supporting liquidity, capital, and leverage includes global senior management and board committees that review and approve all significant capital related decisions.
−Removed: The Company's cash and cash equivalents include unrestricted cash on hand, money market instruments, and other debt instruments with a maturity of 90 days or less when purchased, all of which have minimal market, settlement or other risk exposure.
−Removed: The target minimum amount for the Parent Company’s cash and cash equivalents is approximately $1.8 billion to provide a capital buffer and liquidity support at the holding company.
The Company remains committed to prudent liquidity and capital management.
−Removed: At September 30, 2025, the Company held $6.8 billion in cash and cash equivalents for stress conditions, which includes the Parent Company's target minimum amount of $1.8 billion.
+Added: To provide a capital buffer and liquidity support at the holding company, the target minimum amount for the Parent Company is approximately $1.0 billion.
Aflac Japan and Aflac U.S.
1 unchanged sentence
The primary uses of cash by the Parent Company are shareholder dividends, the repurchase of its common stock, interest on its outstanding indebtedness and operating expenses.
−Removed: The following table presents the amounts provided to the Parent Company for the nine-month periods ended September 30.
+Added: The following table presents the amounts provided to the Parent Company for the three-month periods ended March 31.
Liquidity Provided by Subsidiaries to Parent Company
2 unchanged sentences
Dividends declared or paid by subsidiaries 503 1,154
−Removed: The following table details Aflac Japan remittances, which are included in the totals above, for the nine-month periods ended September 30.
+Added: The following table details Aflac Japan remittances, which are included in the totals above, for the three-month periods ended March 31.
Aflac Japan Remittances
1 unchanged sentence
Aflac Japan management fees paid to Parent Company $ 21 $ 17
−Removed: Aflac Japan dividends declared or paid to Parent Company (in dollars) 2,359 2,032
+Added: Aflac Japan dividends declared or paid to Parent Company (in U.S.
+Added: dollars) 503 759
Aflac Japan dividends declared or paid to Parent Company (in yen) ¥ 80.2 ¥ 113.3
−Removed: The Company intends to maintain higher than historical levels of liquidity and capital at the Parent Company for stress conditions and with the goals of addressing the Company’s hedge costs and related potential need for collateral and mitigating against long-term weakening of the Japanese yen.
+Added: The Company maintains liquidity at the Parent Company for risk management purposes and to support certain derivative activity.
Further, the Company plans to continue to maintain a population of unhedged U.S.
4 unchanged sentences
MD&A in the 2025 Annual Report.
−Removed: In addition to cash and cash equivalents, the Company also maintains credit facilities, both intercompany and with external partners, and a number of other available tools to support liquidity needs on a global basis.
−Removed: The Company was in compliance with all of the covenants of its notes payable and lines of credit at September 30, 2025.
−Removed: In August 2025, the Parent Company expanded its sources of liquidity by entering into two separate facility agreements, as follows:
−Removed: A 10-year facility agreement with a Delaware trust (2035 Trust) that provides the Parent Company with the right to issue and sell to the 2035 Trust from time to time up to $1.0 billion of senior notes due August 2035.
−Removed: A 30-year facility agreement with a Delaware trust (2055 Trust) that provides the Parent Company the right to issue and sell to the 2055 Trust from time to time up to $1.0 billion of senior notes due August 2055.
−Removed: As of September 30, 2025, the Parent Company had no senior note issuances under these facility agreements.
−Removed: For additional information, see Note 9 of the Notes to the Consolidated Financial Statements.
+Added: In addition to cash and cash equivalents, the Company also maintains senior note facility agreements, credit facilities (both intercompany and with external partners), and a number of other available tools to support liquidity needs on a global basis.
In September 2024, the Parent Company filed a shelf registration statement with the SEC that allows the Company to issue an indefinite amount of debt securities, in one or more series, from time to time until September 2027.
The Company believes outside sources for additional debt and equity capital, if needed, will continue to be available.
+Added: The Company was in compliance with all of the covenants of its notes payable and lines of credit at March 31, 2026.
+Added: For additional information, see Note 9 of the Notes to the Consolidated Financial Statements.
As part of enterprise-wide capital management and optimization, the Company also utilizes the intercompany reinsurance platform to execute internal reinsurance transactions with Aflac Re.
2 unchanged sentences
The Company has not engaged in material intra-period short-term financings during the periods presented that are not otherwise reported in its balance sheet or disclosed therein.
−Removed: As of September 30, 2025, the Company had no material letters of credit, standby letters of credit, guarantees or standby repurchase obligations.
+Added: As of March 31, 2026, the Company had no material letters of credit, standby letters of credit, guarantees or standby repurchase obligations.
The Company has not entered into transactions involving the transfer of financial assets with an obligation to repurchase financial assets that have been accounted for as a sale under applicable accounting standards, including securities lending transactions.
5 unchanged sentences
The Company translates cash flows for Aflac Japan’s yen-denominated items into U.S.
−Removed: dollars using weighted-average exchange rates.
−Removed: In periods when the yen weakens, translating yen into dollars causes fewer dollars to be reported.
−Removed: When the yen strengthens, translating yen into dollars causes more dollars to be reported.
−Removed: The following table summarizes consolidated cash flows by activity for the nine-month periods ended September 30.
+Added: dollars using weighted-average foreign exchange rates.
+Added: In periods when the Japanese yen weakens, translating Japanese yen into U.S.
+Added: dollars causes fewer U.S.
+Added: dollars to be reported.
+Added: When the Japanese yen strengthens, translating Japanese yen into U.S.
+Added: dollars causes more U.S.
+Added: dollars to be reported.
+Added: The following table summarizes consolidated cash flows by activity for the three-month periods ended March 31.
(In millions) 2026 2025
11 unchanged sentences
Investing Activities
−Removed: The Company's investment objectives provide for liquidity primarily through the purchase of publicly traded investment-grade debt securities.
+Added: The Company's investment objectives provide for liquidity primarily through the purchase of publicly traded investment-grade fixed maturity securities.
Prudent portfolio management dictates that the Company attempts to match the duration of its assets with the duration of its liabilities.
3 unchanged sentences
As a result, dispositions before maturity can vary significantly from year to year.
−Removed: As part of its overall corporate strategy, the Company has committed up to $400 million to Aflac Ventures, LLC (Aflac Ventures), as opportunities emerge.
−Removed: As of September 30, 2025, of the $400 million committed, approximately $297 million has been deployed.
+Added: As part of its overall corporate strategy, the Company has committed up to $400 million to Aflac Ventures, LLC (Aflac Ventures) as opportunities emerge, of which approximately $298 million has been deployed as of March 31, 2026.
Aflac Ventures is a subsidiary of Aflac Global Ventures, LLC (Aflac Global Ventures) which is reported in Corporate and other.
1 unchanged sentence
with an emphasis on digital applications designed to improve the customer experience, gain efficiencies, and develop new markets in an effort to enhance and defend long-term shareholder value.
−Removed: Investments are included in equity securities or the other investments line in the consolidated balance sheets.
+Added: Investments are included in equity securities or other investments in the consolidated balance sheets.
As part of an arrangement with Federal Home Loan Bank of Atlanta (FHLB), Aflac U.S.
obtains low-cost investment funding from FHLB supported by acceptable forms of collateral pledged by Aflac U.S.
−Removed: In the first nine months of 2025, Aflac U.S.
+Added: In the first three months of 2026, Aflac U.S.
borrowed and repaid $112 million under this program.
−Removed: As of September 30, 2025, Aflac U.S.
+Added: As of March 31, 2026, Aflac U.S.
had outstanding borrowings of $532 million reported in its balance sheet.
2 unchanged sentences
Cash flows from financing activities consist primarily of share repurchases, dividends to shareholders and, from time to time, debt issuances and redemptions.
−Removed: In September 2025, the Parent Company extinguished ¥12.4 billion of .300% senior notes upon their maturity.
−Removed: In June 2025, the Parent Company issued four series of senior notes totaling ¥74.9 billion through a public debt offering under its U.S.
−Removed: shelf registration statement.
−Removed: The first series, which totaled ¥35.0 billion, bears interest at a fixed rate of 1.726% per annum, payable semi-annually, and will mature in October 2030.
−Removed: The second series, which totaled ¥23.4 billion, bears interest at a fixed rate of 2.003% per annum, payable semi-annually, and will mature in December 2032.
−Removed: The third series, which totaled ¥9.5 billion, bears interest at a fixed rate of 2.369% per annum, payable semi-annually, and will mature in June 2035.
−Removed: The fourth series, which totaled ¥7.0 billion, bears interest at a fixed rate of 2.779% per annum, payable semi-annually, and will mature in June 2040.
−Removed: These notes are redeemable at the Parent Company’s option at any time, in whole but not in part, upon the occurrence of certain changes affecting U.S.
−Removed: taxation, as specified in the indenture governing the terms of the issuance.
−Removed: In addition, the notes maturing in October 2030, December 2032, June 2035 and June 2040 are redeemable at the Parent Company's option, in whole or in part from time to time, on or after July 18, 2030, September 14, 2032, December 5, 2034, and December 5, 2039, respectively, at a redemption price equal to the aggregate principal amount of the applicable series to be redeemed plus accrued and unpaid interest on the principal amount to be redeemed to, but excluding, the date of redemption.
−Removed: In May 2025, the Parent Company issued four series of senior notes totaling ¥75.1 billion through a private placement.
−Removed: The first series, which totaled ¥18.2 billion, bears interest at a fixed rate of 1.990% per annum, payable semi-annually, and will mature in May 2032.
−Removed: The second series, which totaled ¥38.3 billion, bears interest at a fixed rate of 2.320% per annum, payable semi-annually, and will mature in May 2035.
−Removed: The third series, which totaled ¥11.6 billion, bears interest at a fixed rate of 2.650% per annum, payable semi-annually, and will mature in May 2040.
−Removed: The fourth series, which totaled ¥7.0 billion, bears interest at a fixed rate of 3.040% per annum, payable semi-annually, and will mature in May 2045.
−Removed: These notes are redeemable at the Parent Company's option (i) in whole at any time or (ii) in part from time to time in an amount not less than 5% of the aggregate principal amount then outstanding of the notes to be redeemed.
−Removed: See Note 9 of the Notes to the Consolidated Financial Statements for further information on the debt issuances discussed above.
−Removed: Cash returned to shareholders through treasury stock purchases and dividends was $3.6 billion during the nine-month period ended September 30, 2025, compared with $2.9 billion during the nine-month period ended September 30, 2024.
−Removed: The following tables present a summary of treasury stock activity during the nine-month periods ended September 30.
+Added: See Note 9 of the Notes to the Consolidated Financial Statements for information on debt issuances and redemptions.
+Added: Cash returned to shareholders through treasury stock purchases and dividends was $1.3 billion during the three-month period ended March 31, 2026, compared with $1.2 billion during the three-month period ended March 31, 2025.
+Added: The following tables present a summary of treasury stock activity during the three-month periods ended March 31.
Treasury Stock Purchased
12 unchanged sentences
Number of shares issued 353 435
−Removed: In August 2025, the Company's board of directors authorized the purchase of an additional 100 million shares of its common stock.
−Removed: As of September 30, 2025, a remaining balance of 121.6 million shares of the Company's common stock was available for purchase under share repurchase authorizations by its board of directors.
−Removed: Cash dividends paid to shareholders were $.58 per share in the third quarter of 2025, compared with $.50 per share in the third quarter of 2024.
−Removed: The following table presents the dividend activity for the nine-month periods ended September 30.
+Added: As of March 31, 2026, a remaining balance of 105.3 million shares of the Company's common stock were available for purchase under share repurchase authorizations by its board of directors.
+Added: Cash dividends paid to shareholders were $.61 per share in the first quarter of 2026, compared with $.58 per share in the first quarter of 2025.
+Added: The following table presents the dividend activity for the three-month periods ended March 31.
(In millions) 2026 2025
2 unchanged sentences
Total dividends to shareholders $ 315 $ 317
−Removed: In November 2025, the board of directors declared the fourth quarter cash dividend of $.58 per share, an increase of 16.0% compared with the same period in 2024.
−Removed: The dividend is payable on December 1, 2025 to shareholders of record at the close of business on November 19, 2025.
+Added: In April 2026, the board of directors declared the second quarter cash dividend of $.61 per share, an increase of 5.2% compared with the same period in 2025.
+Added: The dividend is payable on June 1, 2026 to shareholders of record at the close of business on May 20, 2026.
Regulatory Restrictions
Aflac Japan is required to meet certain financial criteria as governed by the Companies Act of Japan in order to provide dividends to the Parent Company.
−Removed: Under these criteria, dividend capacity at Aflac Japan is defined as total equity excluding common stock and capital reserves (representing statutorily required amounts in Japan) but reduced for net after-tax unrealized losses on available-for-sale securities.
−Removed: These dividend capacity requirements are generally aligned with the SMR.
−Removed: Japan's Financial Services Agency (FSA) maintains its own solvency standard which is quantified through the SMR.
−Removed: Aflac Japan's SMR is sensitive to interest rate, credit spread, and foreign exchange rate changes;
+Added: Under these criteria, dividend capacity at Aflac Japan is defined as total equity excluding common stock and capital reserves but reduced for net after-tax unrealized losses on available-for-sale securities.
+Added: These dividend capacity requirements are generally aligned with the Economic Solvency Ratio (ESR).
+Added: Japan's Financial Services Agency (FSA) maintains its own solvency standard which is quantified through the ESR.
+Added: Aflac Japan's ESR is sensitive to interest rate, credit spread, and foreign exchange rate changes;
therefore, the Company continues to evaluate alternatives for reducing this sensitivity, including the reduction of subsidiary dividends paid to the Parent Company and Parent Company capital contributions.
−Removed: In the event of a rapid change in market risk conditions causing SMR to decline, or in the event of reduced liquidity, the Company has a senior unsecured revolving credit facility in the amount of ¥100 billion as a contingency plan.
+Added: In the event of a rapid change in market risk conditions causing ESR to decline, or in the event of reduced liquidity, the Company has a senior unsecured revolving credit facility in the amount of ¥100 billion as a contingency plan.
+Added: See Note 9 of the Notes to the Consolidated Financial Statements for additional information.
Additionally, subject to market conditions, the Company expects that it could take action to enter into derivatives on unhedged U.S.
dollar-denominated investments with foreign currency options or forwards or execute additional reinsurance transactions.
−Removed: See Notes 8 and 9 of the Notes to the Consolidated Financial Statements for additional information.
−Removed: The Company has already undertaken various measures to mitigate the sensitivity of Aflac Japan's SMR.
−Removed: For example, the Company employs policy reserve matching (PRM) investment strategies, which is a Japan-specific accounting treatment that reduces SMR interest rate sensitivity since PRM-designated investments are carried at amortized cost consistent with corresponding liabilities.
−Removed: In order for a PRM-designated asset to be held at amortized cost, there are certain criteria that must be maintained.
−Removed: The primary criterion relates to maintaining the duration of designated assets and liabilities within a specified tolerance range.
−Removed: If the duration difference is not maintained within the specified range without rebalancing, then a certain portion of the assets must be reclassified as available-for-sale and held at fair value with any associated unrealized gain or loss recorded in surplus.
−Removed: To rebalance, assets may need to be sold in order to maintain the duration with the specified range, resulting in realizing a gain or loss from the sale.
−Removed: GAAP, PRM investments are categorized as available-for-sale.
−Removed: The Company also uses foreign currency derivatives to hedge a portion of its U.S.
−Removed: dollar-denominated investments.
−Removed: See Notes 3, 4 and 8 of the Notes to the Consolidated Financial Statements in the 2024 Annual Report for additional information on the Company's investment strategies, hedging activities, and reinsurance, respectively.
−Removed: As of September 30, 2025, Aflac Japan's SMR remains high and reflects a strong capital and surplus position.
−Removed: The Company is committed to maintaining strong capital levels, consistent with maintaining current insurance financial strength and credit ratings.
−Removed: The FSA will introduce an economic value-based solvency regime based on the Insurance Capital Standards (ICS) for insurance companies in Japan.
−Removed: The initial report on the Economic Solvency Ratio (ESR) will be issued as of March 31, 2026, which is Aflac Japan's 2025 fiscal year-end.
+Added: The FSA has introduced an economic value-based solvency regulation as a new prudential regulatory framework for insurance companies, effective from the fiscal year-end of 2025.
+Added: Under this regulation, assets and liabilities are measured on an economic value basis, and insurers are required to calculate and disclose the ESR as a key indicator of their solvency position.
+Added: Aflac Japan plans to make its initial disclosure of the ESR as of March 31, 2026, in accordance with this regulation, with the first disclosure scheduled for the end of July 2026.
A life insurance company’s statutory capital and surplus is determined according to rules prescribed by the National Association of Insurance Commissioners (NAIC), as modified by the insurance department in the insurance company’s state of domicile.
5 unchanged sentences
The RBC formula quantifies insurance risk, business risk, asset risk and interest rate risk by weighing the types and mixtures of risks inherent in the insurer’s operations.
−Removed: As of September 30, 2025, Aflac U.S.'s combined RBC ratio remains high and reflects a strong capital and surplus position.
+Added: As of March 31, 2026, Aflac U.S.'s combined RBC ratio remains high and reflects a strong capital and surplus position.
Aflac, CAIC and TOIC are domiciled in Nebraska and are subject to its regulations.
3 unchanged sentences
Corporate and Other
−Removed: Aflac Re is licensed by the BMA as a long-term insurer and is subject to the Bermuda Insurance Act of 1978 (Bermuda Insurance Act).
+Added: Aflac Re is licensed by the BMA as a Class E long-term insurer and is subject to the Bermuda Insurance Act of 1978 (Bermuda Insurance Act).
Aflac Re is required to file annual and quarterly returns for its Bermuda Solvency Capital Requirement (BSCR) which utilizes an Economic Balance Sheet (EBS) framework to determine Aflac Re’s Enhanced Capital Requirement (ECR).
20 unchanged sentences
GAAP requires the Company to make estimates based on currently available information when recording transactions resulting from business operations.
−Removed: The estimates that the Company deems to be most critical to an understanding of its results of operations and financial condition are those related to the valuation of investments and derivatives, DAC, liabilities for future policy benefits, and income taxes.
+Added: The estimates that the Company deems to be most critical to an understanding of its results of operations and financial condition are those related to the valuation of investments and derivatives, DAC, liabilities for future policy benefits (LFPB), and income taxes.
The preparation and evaluation of these critical accounting estimates involve the use of various assumptions developed from management’s analyses and judgments.
−Removed: Calculations of DAC and the liability for future policy benefits require the use of estimates based on actuarial valuation techniques.
−Removed: The application of these critical accounting estimates determines the values at which 92% of the Company's assets and 74% of its liabilities are reported as of September 30, 2025, and thus has a direct effect on net earnings and shareholders’ equity.
+Added: Calculations of DAC and the LFPB require the use of estimates based on actuarial valuation techniques.
+Added: The application of these critical accounting estimates determines the values at which 92% of the Company's assets and 72% of its liabilities are reported as of March 31, 2026, and thus has a direct effect on net earnings and shareholders’ equity.
Subsequent experience or use of other assumptions could produce significantly different results.
−Removed: There have been no changes in the items the Company has identified as critical accounting estimates during the nine-month period ended September 30, 2025.
+Added: There have been no changes in the items the Company has identified as critical accounting estimates during the three-month period ended March 31, 2026.
For additional information, see the Critical Accounting Estimates section of Item 7.
3 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.