What changed in this filing

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Item 1. Financial Statements

2025-05-07 compared with 2024-11-06 · 374 added, 636 removed, 2170 unchanged (32% of the section changed)

3 unchanged sentences

(in millions, except share data)

September 30, December 31,

March 31, December 31,

Assets (Unaudited)

Debt Securities, available-for-sale, net of allowance for credit losses of $ 44 and $ 21 at September 30, 2024 and December 31, 2023, respectively (amortized cost:

Debt Securities, available-for-sale, net of allowance for credit losses of $ 40 and $ 39 at March 31, 2025 and December 31, 2024, respectively (amortized cost:

2025 $ 46,312 ;

2 unchanged sentences

Debt Securities, at fair value under fair value option 3,430 3,046

Debt Securities, trading, at fair value 73 68

Equity securities, at fair value 191 197

Mortgage loans, net of allowance for credit losses of $ 148 and $ 165 at September 30, 2024 and December 31, 2023, respectively

Mortgage loans, net of allowance for credit losses of $ 130 and $ 121 at March 31, 2025 and December 31, 2024, respectively

Mortgage loans, at fair value under fair value option 451 449

Policy loans (including $ 3,535 and $ 3,457 at fair value under the fair value option at September 30, 2024 and December 31, 2023, respectively)

Policy loans (including $ 3,492 and $ 3,489 at fair value under the fair value option at March 31, 2025 and December 31, 2024, respectively)

Freestanding derivative instruments 587 297

4 unchanged sentences

Deferred acquisition costs 11,770 11,887

Reinsurance recoverable, net of allowance for credit losses of $ 25 and $ 29 at September 30, 2024 and December 31, 2023, respectively

Reinsurance recoverable, net of allowance for credit losses of $ 26 and $ 27 at March 31, 2025 and December 31, 2024, respectively

21,037 21,830

9 unchanged sentences

Market risk benefit liabilities, at fair value 4,125 3,774

Funds withheld payable under reinsurance treaties (including $ 3,711 and $ 3,626 at fair value under the fair value option at September 30, 2024 and December 31, 2023, respectively)

Funds withheld payable under reinsurance treaties (including $ 3,672 and $ 3,667 at fair value under the fair value option at March 31, 2025 and December 31, 2024, respectively)

16,275 16,742

10 unchanged sentences

24,000 shares authorized;

22,000 shares issued and outstanding at September 30, 2024 and December 31, 2023;

22,000 shares issued and outstanding at March 31, 2025 and December 31, 2024;

liquidation preference $ 25,000 per share (see Note 19)

Common stock;

1,000,000,000 shares authorized, $ 0.01 par value per share and 74,351,061 and 78,660,221 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively (See Note 19)

1,000,000,000 shares authorized, $ 0.01 par value per share and 71,878,542 and 73,380,643 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively (see Note 19)

Additional paid-in capital 6,042 6,046

Treasury stock, at cost;

20,133,348 and 15,820,785 shares at September 30, 2024 and December 31, 2023, respectively

22,609,773 and 21,107,672 shares at March 31, 2025 and December 31, 2024, respectively

( 1,179 ) ( 1,007 )

Accumulated other comprehensive income (loss), net of tax expense (benefit) of $( 323 ) and $( 178 ) at September 30, 2024 and December 31, 2023, respectively

Accumulated other comprehensive income (loss), net of tax expense (benefit) of $( 216 ) and $( 311 ) at March 31, 2025 and December 31, 2024, respectively

( 2,719 ) ( 3,522 )

8 unchanged sentences

(Unaudited, in millions, except per share data)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Fee income $ 1,986 $ 1,998

24 unchanged sentences

Net income (loss) attributable to Jackson Financial Inc.

( 469 ) 2,773 601 2,493

Dividends on preferred stock 11 11

8 unchanged sentences

(Unaudited, in millions)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Net income (loss) $ ( 18 ) $ 802

1 unchanged sentence

Change in unrealized gains (losses) on securities with no credit impairment, net of tax expense (benefit) of:

$ 68 and $( 62 ), for the three months ended September 30, 2024 and 2023, respectively, and $ 54 and $( 4 ), for the nine months ended September 30, 2024 and 2023, respectively.

1,679 ( 1,223 ) 1,170 ( 787 )

$ 40 and $( 3 ), for the three months ended March 31, 2025 and 2024, respectively.

Change in unrealized gains (losses) on securities with credit impairment, net of tax expense (benefit) of:

$( 2 ) and $( 4 ), for the three months ended September 30, 2024 and 2023, respectively, and $( 1 ) and $( 7 ), for the nine months ended September 30, 2024 and 2023, respectively.

( 33 ) ( 15 ) ( 28 ) ( 24 )

Change in current discount rate related to reserve for future policy benefits, net of tax expense (benefit) of $( 61 ) and $ 55 , for the three months ended September 30, 2024 and 2023, respectively, and $( 29 ) and $ 44 , for the nine months ended September 30, 2024 and 2023, respectively.

( 219 ) 199 ( 103 ) 160

Change in non-performance risk on market risk benefits, net of tax expense (benefit) of $( 51 ) and $( 216 ), for the three months ended September 30, 2024 and 2023, respectively, and $( 169 ) and $( 321 ), for the nine months ended September 30, 2024 and 2023, respectively.

( 184 ) ( 783 ) ( 614 ) ( 1,158 )

nil and nil , for the three months ended March 31, 2025 and 2024, respectively.

Change in current discount rate related to reserve for future policy benefits, net of tax expense (benefit) of $( 16 ) and $ 18 , for the three months ended March 31, 2025 and 2024, respectively.

Change in non-performance risk on market risk benefits, net of tax expense (benefit) of $ 71 and $( 111 ), for the three months ended March 31, 2025 and 2024, respectively.

Total other comprehensive income (loss) 803 ( 615 )

2 unchanged sentences

Comprehensive income (loss) attributable to Jackson Financial Inc.

$ 774 $ 951 $ 1,026 $ 684

See Notes to Condensed Consolidated Financial Statements.

5 unchanged sentences

Stock Stock Capital at Cost Income Earnings Equity Interests Equity

Balances as of June 30, 2024 $ 533 $ 1 $ 6,007 $ ( 796 ) $ ( 3,626 ) $ 7,965 $ 10,084 $ 200 $ 10,284

Net income (loss) — — — — — ( 469 ) ( 469 ) 3 ( 466 )

Other comprehensive income (loss) — — — — 1,243 — 1,243 — 1,243

Change in equity of noncontrolling interests — — — — .

Dividends on preferred stock — — — — — ( 11 ) ( 11 ) — ( 11 )

Dividends on common stock — — — — — ( 54 ) ( 54 ) — ( 54 )

Purchase of treasury stock — — — ( 113 ) — — ( 113 ) — ( 113 )

Share based compensation — — 18 — — — 18 — 18

Balances as of September 30, 2024 $ 533 $ 1 $ 6,025 $ ( 909 ) $ ( 2,383 ) $ 7,431 $ 10,698 $ 209 $ 10,907

Additional Treasury Other Total Non-

Preferred Common Paid-In Stock Comprehensive Retained Shareholders' Controlling Total

Stock Stock Capital at Cost Income Earnings Equity Interests Equity

Balances as of June 30, 2023 $ 533 $ 1 $ 5,997 $ ( 466 ) $ ( 3,365 ) $ 5,952 $ 8,652 $ 771 $ 9,423

Net income (loss) — — — — — 2,773 2,773 17 2,790

Other comprehensive income (loss) — — — — ( 1,822 ) — ( 1,822 ) — ( 1,822 )

Change in equity of noncontrolling interests — — — — .

— — ( 13 ) ( 13 )

Dividends on preferred stock — — — — — ( 11 ) ( 11 ) — ( 11 )

Dividends on common stock — — — — — ( 52 ) ( 52 ) — ( 52 )

Purchase of treasury stock — — — ( 72 ) — — ( 72 ) — ( 72 )

Share based compensation — — 10 1 — ( 1 ) 10 — 10

Balances as of September 30, 2023 $ 533 $ 1 $ 6,007 $ ( 537 ) $ ( 5,187 ) $ 8,661 $ 9,478 $ 775 $ 10,253

Additional Treasury Other Total Non-

Preferred Common Paid-In Stock Comprehensive Retained Shareholders' Controlling Total

Stock Stock Capital at Cost Income Earnings Equity Interests Equity

Balances as of December 31, 2024 $ 533 $ 1 $ 6,046 $ ( 1,007 ) $ ( 3,522 ) $ 7,713 $ 9,764 $ 218 $ 9,982

6 unchanged sentences

Share based compensation — — ( 4 ) 30 — 4 30 — 30

Balances as of September 30, 2024 $ 1 $ 533 $ 1 $ 6,025 $ ( 909 ) $ ( 2,383 ) $ 7,431 $ 10,698 $ 209 $ 10,907

Balances as of March 31, 2025 $ 533 $ 1 $ 6,042 $ ( 1,179 ) $ ( 2,719 ) $ 7,623 $ 10,301 $ 224 $ 10,525

Additional Treasury Other Total Non-

8 unchanged sentences

Purchase of treasury stock — — — ( 120 ) — — ( 120 ) — ( 120 )

Issuance of preferred stock 533 — — — — — 533 — 533

Share based compensation — — — 6 — — 6 — 6

Balances as of September 30, 2023 $ 533 $ 1 $ 6,007 $ ( 537 ) $ ( 5,187 ) $ 8,661 $ 9,478 $ 775 $ 10,253

Balances as of March 31, 2024 $ 533 $ 1 $ 6,005 $ ( 713 ) $ ( 3,423 ) $ 7,766 $ 10,169 $ 187 $ 10,356

See Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

(Unaudited, in millions)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from operating activities:

33 unchanged sentences

(Unaudited, in millions)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from financing activities:

12 unchanged sentences

Purchase of treasury stock ( 202 ) ( 120 )

Issuance of preferred stock — 533

Net cash provided by (used in) financing activities ( 521 ) 433

19 unchanged sentences

Jackson Financial Inc.

("JFI" or “Jackson Financial”) together with its subsidiaries (the “Company,” which also may be referred to as “we,” “our” or “us”), is a financial services company focused on helping Americans grow and protect their retirement savings and income to enable them to pursue financial freedom for life.

Jackson Financial is domiciled in the state of Delaware in the United States (“U.S.”).

Prior to September 13, 2021, we were a majority-owned subsidiary of Prudential plc ("Prudential"), London, England and served as Prudential's holding company for its U.S.

On September 13, 2021, the Company demerged from Prudential (the "Demerger") and became a stand-alone U.S.

public company.

Prudential retained an equity interest in the Company after the Demerger, but as of June 30, 2023, sold its entire equity interest in the Company.

Jackson Financial’s primary life insurance subsidiary, Jackson National Life Insurance Company and its insurance subsidiaries (collectively, “Jackson”), is licensed to sell group and individual annuity products (including immediate, registered index-linked, deferred fixed, fixed index and variable annuities), and individual life insurance products, including variable universal life, in all 50 states and the District of Columbia.

Jackson Financial’s primary life insurance subsidiary, Jackson National Life Insurance Company and its insurance subsidiaries (collectively, “Jackson”), is licensed to sell group and individual annuity products (including variable, registered index-linked, fixed index, fixed and payout annuities), and individual life insurance products, including variable universal life, in all 50 states and the District of Columbia.

Jackson also participates in the institutional products market through the issuance of guaranteed investment contracts (“GICs”), funding agreements and medium-term note funding agreements.

In addition to Jackson, Jackson Financial’s other operating subsidiaries are as follows:

In addition to Jackson, Jackson Financial’s operating subsidiaries include:

• PPM America, Inc.

5 unchanged sentences

• Life insurers:

Jackson National Life Insurance Company of New York (“Jackson NY” or “JNY”);

Jackson National Life Insurance Company of New York;

Squire Reassurance Company II, Inc.;

(“Squire Re II”);

and VFL International Life Company SPC, LTD;

• Registered broker-dealer:

Jackson National Life Distributors LLC (“JNLD”);

Jackson National Life Distributors LLC;

• Registered investment adviser:

2 unchanged sentences

The Company's Condensed Consolidated Financial Statements also include other insignificant partnerships, limited liability companies (“LLCs”) and other variable interest entities (“VIEs”) in which the Company is deemed the primary beneficiary.

See Notes to Condensed Consolidated Financial Statements.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 1.

Business and Basis of Presentation

Brooke Life Reinsurance Company

During the first quarter of 2024, Jackson entered into a reinsurance transaction with Brooke Re and all economics of the transaction were effective as of January 1, 2024.

Jackson and Brooke Re are both direct subsidiaries of Brooke Life and the reinsurance transaction eliminates upon consolidation at JFI.

The reinsurance transaction primarily provides for the cession from Jackson to Brooke Re of liabilities associated with certain guaranteed benefit riders under our variable annuity contracts and similar products of Jackson (“market risk benefits”), both in-force on the effective date of the reinsurance agreement and written in the future ( i.e.

, on a “flow” basis).

Brooke Re utilizes a modified U.S.

generally accepted accounting principles ("U.S.

GAAP") approach primarily related to market risk benefits, to increase alignment between assets and liabilities in response to changes in economic factors.

The reinsurance transaction allows us to mitigate the impact of the cash surrender value floor on Jackson’s total adjusted capital, statutory required capital, and risk-based capital ratio, as well as to allow for more efficient economic hedging of the underlying risks of Jackson’s business.

Basis of Presentation

6 unchanged sentences

Certain accounting policies, which significantly affect the determination of financial condition, results of operations and cash flows, are summarized in the Notes to Consolidated Financial Statements in the Company’s 2024 Annual Report.

In the opinion of management, these Condensed Consolidated Financial Statements include all normal recurring adjustments necessary for a fair presentation of the Company’s results.

Operating results for the three and nine months ended September 30, 2024, are not necessarily indicative of the results that may be expected for the full year ending December 31, 2024.

All material intercompany accounts and transactions have been eliminated in consolidation.

All prior period amounts have been conformed to the current period presentation, unless otherwise indicated below.

With the establishment of Brooke Re in the first quarter of 2024, the Company’s hedging program was enhanced to align hedging instruments more closely with market risk benefit reserves, which resulted in higher levels of interest rate hedging consistent with the economics of our business.

In connection with this enhanced hedging approach, the Company reviewed its existing interest rate hedging instruments and determined that interest rate swaps that were historically used for duration management purposes should be recharacterized as supporting our hedging of variable annuity market risk benefits.

Accordingly, effective January 1, 2024, the periodic settlements and change in settlement accruals on interest rate swaps are now classified as non-operating and excluded from pretax adjusted operating earnings.

Prior period amounts have not been adjusted for this prospective recharacterization with respect to interest rate swaps.

Additionally, to better represent the underlying performance of our business, we have made certain reclassifications between financial statement line items within the Condensed Consolidated Income Statement and our non-GAAP financial measure of pretax adjusted operating earnings.

These reclassifications, described below, had no impact on Net Income or Adjusted Operating Earnings.

• Operating derivative income (loss) will no longer be shown as a separate line item within pretax adjusted operating earnings, as these amounts have been reclassified to net investment income.

After recharacterizing the interest rate swaps described above, the only item remaining in operating derivatives was periodic settlements and change in settlement accruals on cross-currency swaps that are intended to hedge certain foreign denominated fixed maturity securities.

This reclassification only applies to pretax adjusted operating earnings (non-GAAP).

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 1.

Business and Basis of Presentation

• Interest costs related to portfolio leverage transactions (repurchase agreements, Federal Home Loan Bank short-term advances, and cash collateral costs) were reclassified from Interest Expense to Net Investment Income.

This reclassification applies to Net Income (GAAP) and pretax adjusted operating earnings (non-GAAP).

In the opinion of management, these Condensed Consolidated Financial Statements include all normal recurring adjustments necessary for a fair presentation of the Company’s results.

Operating results for the three months ended March 31, 2025, are not necessarily indicative of the results that may be expected for the full year ending December 31, 2025.

All material intercompany accounts and transactions have been eliminated upon consolidation.

All prior period amounts have been conformed to the current period presentation.

Use of Estimates

4 unchanged sentences

• Assumptions used in calculating policy reserves and liabilities, including policyholder behavior, mortality rates, expenses, investment returns and policy crediting rates;

• Assumptions as to future earnings levels being sufficient to realize deferred tax benefits;

• Estimates related to expectations of credit losses on certain financial assets and off-balance sheet exposures;

• Assumptions and estimates associated with the Company’s tax positions, including an estimate of the dividends received deduction, which impact the amount of recognized tax benefits recorded by the Company, and assumptions as to future earnings levels being sufficient to realize deferred tax benefits;

• Assumptions used in calculating market risk benefits, including policyholder behavior, mortality rates, and capital market assumptions;

4 unchanged sentences

Since future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates.

Changes in estimates, including those resulting from continuing changes in the economic environment, will be reflected in the Consolidated Financial Statements in the periods the estimates are changed.

New Accounting Standards

Changes in Accounting Principles – Adopted in Current Year

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, “Reference Rate Reform (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The guidance provides optional expedients for applying U.S.

GAAP to contracts and other transactions affected by reference rate reform and was originally effective for contract modifications made between March 12, 2020 and December 31, 2022.

In December 2022, the FASB issued ASU 2022-06, “Reference Rate Reform (Topic 848):

Deferral of the Sunset Date of Topic 848” that defers the sunset date of Topic 848 from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848.

If certain criteria are met, an entity will not be required to remeasure or reassess contracts impacted by reference rate reform.

The practical expedient allowed by this standard was elected and applied by the Company.

The contracts modified met the criteria for the practical expedient and, therefore, the transition did not have a material impact on the Company’s Condensed Consolidated Financial Statements.

The Company has completed its transition from the London Interbank Offered Rate ("LIBOR").

Changes in Accounting Principles – Issued but Not Yet Adopted

In November 2023, the FASB issued ASU 2023-07, “Improvements to Reportable Segment Disclosures”, which requires a public entity to disclose its significant segment expenses regularly provided to the chief operating decision maker ("CODM") and the amount and composition of other segment items.

It also requires a public entity to disclose the title and position of the CODM.

The ASU allows a public entity to disclose multiple measurements of segment profit or loss if a CODM uses multiple measures to assess segment’s performance and allocate resources.

This ASU also expands the current interim disclosure requirements to require that nearly all of the annual segment disclosures be made on an interim basis.

The amendments in this ASU will be effective for the Company for annual periods beginning after December 15, 2023, and

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 2.

The effects of changes in estimates, including those resulting from changing expectations with respect to the economic environment, will be reflected in the Consolidated Financial Statements covering the periods in which the estimates are changed.

New Accounting Standards

interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted, and are to be applied retrospectively.

The Company is in the process of evaluating the impact of the new guidance and does not plan to early adopt.

In December 2023, the FASB issued ASU 2023-09, “Improvements to Income Tax Disclosures”, which enhances annual income tax disclosures by requiring disclosure of disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid.

Accounting Pronouncements – Issued but Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, “Improvements to Income Tax Disclosures”, which enhances annual income tax disclosures by requiring disclosure of disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid.

The new requirements in this ASU will be effective for the Company for annual periods beginning after December 15, 2024, with early adoption permitted, and are to be applied on a prospective basis with the option to apply retrospectively.

The Company will apply the amendments for the annual period ending December 31, 2025.

The Company does not expect the adoption to have a material impact on the Company’s financial statements.

In November 2024, the FASB issued ASU 2024-03, “Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40)”, which requires disaggregated disclosure of income statement expenses for public business entities.

The ASU requires footnote disclosure about specific types of expenses included in certain expense captions presented on the face of the income statement and the total amount of selling expenses on an annual and interim basis.

The entity is also required to disclose its definition of selling expenses in annual reporting periods.

The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.

Early adoption is permitted.

The Company is in the process of evaluating the impact of the new guidance and determining the transition method and the timing of adoption.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 3.

Segment Information

The Company has three reportable segments:

2 unchanged sentences

The reportable segments reflect how the Company’s chief operating decision maker views and manages the business.

The Company’s chief operating decision maker function is performed jointly by the Chief Executive Officer and the Chief Financial Officer.

For the Retail Annuities, Closed Life and Annuity Blocks, and Institutional Products segments, the chief operating decision maker uses segment pretax adjusted operating earnings to allocate resources for each segment, predominantly through the annual budget and forecasting process, and to assess the performance of each segment, predominantly by comparing the results of each segment with one another, with planned and forecasted results, and with comparative prior period results.

The following is a brief description of the Company’s reportable segments, plus its Corporate and Other segment.

20 unchanged sentences

This segment includes various protection products, primarily whole life, universal life, variable universal life, and term life insurance products, as well as fixed, fixed index, and payout annuities.

The Closed Life and Annuity Blocks segment also includes a block of group payout annuities that we assumed from John Hancock Life Insurance Company (USA) and John Hancock Life Insurance Company of New York through reinsurance transactions in 2018 and 2019, respectively.

The Company historically offered traditional and interest-sensitive life insurance products but discontinued new sales of life insurance products in 2012, as we believe opportunistically acquiring mature blocks of life insurance policies is a more efficient means of diversifying our in-force business than selling new life insurance products.

2 unchanged sentences

The Company’s Corporate and Other segment primarily consists of the operations of its investment management subsidiary, PPM, VIEs, and unallocated corporate income and expenses.

The Corporate and Other segment also includes certain eliminations and consolidation adjustments.

The Corporate and Other segment also includes intersegment eliminations and consolidation adjustments.

Segment Performance Measurement

14 unchanged sentences

and (b) investment income and change in fair value of certain non-derivative assets used to manage the risk associated with market risk benefits and other guaranteed benefit features;

(iii) the movements in reserves, market risk benefits, guaranteed benefit features accounted for as embedded derivative instruments, and related claims and benefit payments;

(iv) amortization of the balance of unamortized deferred acquisition costs, at January 1, 2021, the date of transition to current Long Duration Targeted Improvements ("LDTI") accounting guidance, associated with items excluded from pretax adjusted operating earnings prior to transition;

and (v) the impact on the valuation of Guaranteed Benefits and Net Hedging Results arising from changes in underlying actuarial assumptions.

We believe excluding these items removes the impact to both revenue and related expenses associated with Guaranteed Benefits and Net Hedging Results.

and (iii) the movements in reserves, market risk benefits, guaranteed benefit features accounted for as embedded derivative instruments, and related claims and benefit payments (excluding impacts of actuarial assumption updates and model enhancements).

We believe excluding these items removes the impact to both revenue and related expenses associated with Net Hedging Results.

Amortization of DAC associated with non-operating items at date of transition to LDTI:

Amortization of the balance of unamortized deferred acquisition costs, at January 1, 2021, the date of transition to current Long Duration Targeted Improvements ("LDTI") accounting guidance, associated with items excluded from pretax adjusted operating earnings prior to transition.

Actuarial Assumption Updates and Model Enhancements:

The impact on the valuation of market risk benefits and embedded derivatives arising from our annual actuarial assumption updates and model enhancements review.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 3.

10 unchanged sentences

(i) the impact of investments that are consolidated in our financial statements due to U.S.

GAAP accounting requirements, such as our investments in collateralized loan obligations ("CLOs"), but for which the consolidation effects are not consistent with our economic interest or exposure to those entities, and (ii) one-time or other non-recurring items.

above), excluding earned income from periodic settlements and changes in settlement accruals on cross-currency swaps, and (iii) one-time or other non-recurring items.

Income taxes.

Set forth in the tables below is certain information with respect to the Company’s segments (in millions):

Three Months Ended September 30, 2024 Retail Annuities Institutional

Products Closed Life

Blocks Corporate and

Operating Revenues

Fee income $ 1,128 $ — $ 111 $ 12 $ 1,251

Premiums 12 — 22 — 34

Net investment income 196 101 155 — 452

Other income (loss) 8 — 7 ( 1 ) 14

Total Operating Revenues 1,344 101 295 11 1,751

Operating Benefits and Expenses

Death, other policy benefits and change in policy

reserves, net of deferrals 26 — 131 — 157

(Gain) loss from updating future policy benefits cash flow assumptions, net ( 12 ) — 11 — ( 1 )

Interest credited on other contract holder funds, net

of deferrals and amortization

88 83 104 — 275

Interest expense 6 — — 19 25

Operating costs and other expenses, net of deferrals 638 1 40 63 742

Amortization of deferred acquisition costs 140 — 2 — 142

Total Operating Benefits and Expenses 886 84 288 82 1,340

Pretax Adjusted Operating Earnings $ 458 $ 17 $ 7 $ ( 71 ) $ 411

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 3.

Segment Information

Three Months Ended September 30, 2023 Retail Annuities Institutional

Products Closed Life

Blocks Corporate and

Operating Revenues

Fee income $ 1,038 $ — $ 112 $ 11 $ 1,161

Premiums 6 — 30 — 36

Net investment income 110 109 161 14 394

Other income 9 — 8 1 18

Total Operating Revenues 1,163 109 311 26 1,609

Operating Benefits and Expenses

Death, other policy benefits and change in policy

reserves, net of deferrals 24 — 150 — 174

(Gain) loss from updating future policy benefits cash flow assumptions, net ( 4 ) — 4 — —

Interest credited on other contract holder funds, net

of deferrals and amortization 90 87 107 — 284

Interest expense 6 — — 22 28

Operating costs and other expenses, net of deferrals 554 1 41 30 626

Amortization of deferred acquisition costs 139 — 3 — 142

Total Operating Benefits and Expenses 809 88 305 52 1,254

Pretax Adjusted Operating Earnings $ 354 $ 21 $ 6 $ ( 26 ) $ 355

Nine Months Ended September 30, 2024 Retail Annuities Institutional

Three Months Ended March 31, 2025 Retail Annuities Institutional

Products Closed Life

14 unchanged sentences

Interest expense 6 — — 19 25

Operating costs and other expenses, net of deferrals 1,825 3 110 167 2,105

Asset-based commission expenses 284 — — — 284

Other commission expenses 206 — 9 — 215

Sub-advisor expenses 80 — — ( 2 ) 78

General and administrative expenses 200 1 27 31 259

Deferral of acquisition costs ( 158 ) — ( 1 ) — ( 159 )

Amortization of deferred acquisition costs 145 — 2 — 147

3 unchanged sentences

Segment Information

Nine Months Ended September 30, 2023 Retail Annuities Institutional

Three Months Ended March 31, 2024 Retail Annuities Institutional

Products Closed Life

13 unchanged sentences

Interest expense 6 — — 19 25

Operating costs and other expenses, net of deferrals 1,605 3 122 132 1,862

Asset-based commission expenses 279 — — — 279

Other commission expenses 194 — 9 — 203

Sub-advisor expenses 82 — — ( 2 ) 80

General and administrative expenses 180 1 25 65 271

Deferral of acquisition costs ( 149 ) — 1 — ( 148 )

Amortization of deferred acquisition costs 137 — 2 — 139

2 unchanged sentences

Intersegment eliminations in the above tables are included in the Corporate and Other segment.

These include the elimination of investment income, between Retail Annuities and the Corporate and Other segments, as well as the elimination from fee income and investment income of investment fees paid by Jackson Financial and its subsidiaries to PPM, which were $ 21 million and $ 20 million for the three months ended September 30, 2024 and 2023, respectively, and $ 60 million and $ 57 million for the nine months ended September 30, 2024 and 2023, respectively .

These include the elimination of investment income, between Retail Annuities and the Corporate and Other segments, as well as the elimination from fee income and investment income of investment fees paid by Jackson Financial and its subsidiaries to PPM, which were $ 21 million and $ 19 million for the three months ended March 31, 2025 and 2024, respectively .

The following table summarizes the reconciling items from the non-GAAP measure of total operating revenues to the U.S.

GAAP measure of total revenues attributable to the Company (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Total operating revenues $ 1,773 $ 1,680

7 unchanged sentences

(1) Substantially all the Company's revenues originated in the U.S.

There were no customers that, individually, generate revenues that exceeded 10% of total revenues.

There were no customers that, individually, generate revenues that exceeded 10% of total revenues attributable to the Company.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 3.

2 unchanged sentences

GAAP measure of total benefits and expenses attributable to the Company (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Total operating benefits and expenses $ 1,331 $ 1,291

5 unchanged sentences

GAAP measure of net income attributable to the Company (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Pretax adjusted operating earnings $ 442 $ 389

4 unchanged sentences

Net reserve and embedded derivative movements 333 ( 364 )

Total net hedging results ( 134 ) 566

Amortization of DAC associated with non-operating items at date of transition to LDTI ( 128 ) ( 139 )

Total Guaranteed benefits and net hedging results ( 430 ) 2,786 ( 204 ) 1,983

Net realized investment gains (losses) ( 66 ) ( 7 )

3 unchanged sentences

Pretax income (loss) attributable to Jackson Financial Inc.

( 582 ) 3,485 625 2,892

Income tax expense (benefit) 1 101

Net income (loss) attributable to Jackson Financial Inc.

( 469 ) 2,773 601 2,493

Dividends on preferred stock 11 11

1 unchanged sentence

common shareholders $ ( 35 ) $ 784

The following table summarizes total assets by segment (in millions):

March 31, 2025 December 31, 2024

Retail Annuities $ 284,835 $ 296,621

Closed Life and Annuity Blocks 26,243 26,700

Institutional Products 10,239 9,332

Corporate and Other 5,876 5,797

Total Assets $ 327,193 $ 338,450

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

4 unchanged sentences

Debt Securities

The following table sets forth the composition of the fair value of debt securities at September 30, 2024, and December 31, 2023, classified by rating categories as assigned by a nationally recognized statistical rating organization (a “rating agency”), the National Association of Insurance Commissioners (the “NAIC”), or if not rated by such organizations, the Company’s investment advisors.

The following table sets forth the composition of the fair value of debt securities at March 31, 2025, and December 31, 2024, classified by rating categories as assigned by a nationally recognized statistical rating organization (a “rating agency”), the National Association of Insurance Commissioners (the “NAIC”), or if not rated by such organizations, the Company’s investment advisors.

The Company uses the second lowest rating by a rating agency when rating agencies' ratings are not equivalent and, for purposes of the table, if not otherwise rated by a rating agency, the NAIC rating of a security is converted to an equivalent rating agency rating.

At September 30, 2024 and December 31, 2023, the carrying value of investments rated by the Company’s consolidated investment advisor totaled $ 233 million and $ 486 million, respectively.

At March 31, 2025 and December 31, 2024, the carrying value of investments rated by the Company’s consolidated investment advisor totaled $ 723 million and $ 417 million, respectively.

Percent of Total Debt

Securities Carrying Value

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Investment Rating

7 unchanged sentences

100.0 % 100.0 %

At September 30, 2024 and December 31, 2023, the total carrying value of debt securities in an unrealized loss position consisted of:

September 30, 2024 December 31, 2023

At March 31, 2025 and December 31, 2024, the total carrying value of debt securities in an unrealized loss position consisted of:

March 31, 2025 December 31, 2024

Investment grade securities 79 % 79 %

1 unchanged sentence

Not rated securities 20 % 20 %

Unrealized losses on debt securities that were below investment grade or not rated were approximately 20 % and 21 % of the aggregate gross unrealized losses on available-for-sale debt securities at September 30, 2024 and December 31, 2023, respectively.

Unrealized losses on debt securities that were below investment grade or not rated were approximately 19 % and 19 % of the aggregate gross unrealized losses on available-for-sale debt securities at March 31, 2025 and December 31, 2024, respectively.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

Corporate securities in an unrealized loss position were diversified across industries as follows (in millions, except percentages):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Industries accounting for the largest percentage of corporate gross unrealized losses:

2 unchanged sentences

Largest unrealized loss related to a single corporate obligor $ 59 $ 61

At September 30, 2024 and December 31, 2023, the amortized cost, allowance for credit loss ("ACL"), gross unrealized gains and losses, and fair value of debt securities, including trading securities and securities carried at fair value under the fair value option, were as follows (in millions):

At March 31, 2025 and December 31, 2024, the amortized cost, allowance for credit loss ("ACL"), gross unrealized gains and losses, and fair value of debt securities, including trading securities and securities carried at fair value under the fair value option, were as follows (in millions):

Allowance Gross Gross

Amortized for Unrealized Unrealized Fair

September 30, 2024 Cost (1)

March 31, 2025 Cost (1)

Credit Loss Gains Losses Value

21 unchanged sentences

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

The amortized cost, ACL, gross unrealized gains and losses, and fair value of debt securities at September 30, 2024, by contractual maturity, are shown below (in millions).

The amortized cost, ACL, gross unrealized gains and losses, and fair value of debt securities at March 31, 2025, by contractual maturity, are shown below (in millions).

Actual maturities may differ from contractual maturities where securities can be called or prepaid with or without early redemption penalties.

12 unchanged sentences

(1) Amortized cost, apart from the carrying value for securities carried at fair value under the fair value option and trading securities.

As required by law in various states in which business is conducted, securities with a carrying value of $ 91 million and $ 91 million at September 30, 2024 and December 31, 2023, respectively, were on deposit with regulatory authorities.

As required by law in various states in which business is conducted, securities with a carrying value of $ 87 million and $ 83 million at March 31, 2025 and December 31, 2024, respectively, were on deposit with regulatory authorities.

Residential mortgage-backed securities (“RMBS”) include certain RMBS that are collateralized by residential mortgage loans and are neither expressly nor implicitly guaranteed by U.S.

3 unchanged sentences

Amortized for Unrealized Unrealized Fair

September 30, 2024 Cost (1)

March 31, 2025 Cost (1)

Credit Loss Gains Losses Value

18 unchanged sentences

The following table summarizes the number of securities, fair value and the gross unrealized losses of debt securities, aggregated by investment category and length of time that individual debt securities have been in a continuous loss position (dollars in millions):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Less than 12 months Less than 12 months

35 unchanged sentences

(1) Certain securities contain multiple lots and fit the criteria of both aging groups.

Debt securities in an unrealized loss position as of September 30, 2024 did not require an impairment recognized in earnings as (i) the Company did not intend to sell these debt securities, (ii) it is not more likely than not that the Company will be required to sell these securities before recovery of their amortized cost basis, and (iii) the difference in the fair value compared to the amortized cost was due to factors other than credit loss.

Debt securities in an unrealized loss position as of March 31, 2025 did not require an impairment recognized in earnings as (i) the Company did not intend to sell these debt securities, (ii) it is not more likely than not that the Company will be required to sell these securities before recovery of their amortized cost basis, and (iii) the difference in the fair value compared to the amortized cost was due to factors other than credit loss.

Based upon this evaluation, the Company believes it has the ability to generate adequate amounts of cash from normal operations to meet cash requirements with a reasonable margin of safety without requiring the sale of impaired securities.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

As of September 30, 2024, unrealized losses associated with debt securities are primarily due to widening credit spreads or rising risk-free rates since purchase.

As described below, the Company performed analyses of the financial performance of the underlying issues in an unrealized loss position and determined that recovery of the entire amortized cost of each impaired security is expected.

As of March 31, 2025, unrealized losses associated with debt securities are primarily due to widening credit spreads or rising risk-free rates since purchase.

As described below, the Company performed analyses of the financial performance of the underlying issues in an unrealized loss position and believes that recovery of the entire amortized cost of each impaired security is expected.

Evaluation of Available-for-Sale Debt Securities for Credit Loss

2 unchanged sentences

If neither criterion is met, the securities are further evaluated to determine if the cause of the decline in fair value resulted from credit losses or other factors, such as estimates about issuer operations and future earnings potential.

The credit loss evaluation for a security may consider the following:

The credit loss evaluation for a security may consider one or more the following:

• the extent to which the fair value is below amortized cost;

3 unchanged sentences

• the existence of, and realizable value of, any collateral backing the obligations;

and the macro-economic and micro-economic outlooks for the issuer and its industry.

In addition to the above, the credit loss review of asset-backed securities includes an assessment of future estimated cash flows under expected and stress case scenarios to identify potential shortfalls in contractual payments.

• the macro-economic and micro-economic outlooks for the issuer and its industry;

• for asset-backed securities:

includes an assessment of future estimated cash flows under expected and stress case scenarios to identify potential shortfalls in contractual payments.

These estimated cash flows are developed using available performance indicators from the underlying assets, such as current and projected default or delinquency rates, levels of credit enhancement, current subordination levels, vintage, expected loss severity and other relevant characteristics;

21 unchanged sentences

Accrued interest receivables that are determined to be uncollectible are written off with a corresponding reduction to net investment income.

Accrued interest of $ 1 million and $ 1 million was written off during the three and nine months ended September 30, 2024 and 2023, respectively.

Accrued interest of nil and nil was written off during the three months ended March 31, 2025 and 2024, respectively.

The roll-forward of the allowance for credit loss for available-for-sale securities by sector is as follows (in millions):

Three Months Ended September 30, 2024 US

securities Other government securities Public

utilities Corporate securities Residential mortgage-backed Commercial mortgage-backed Other

asset-backed securities Total

Balance at July 1, 2024 $ — $ — $ — $ 13 $ 6 $ — $ 8 $ 27

Additions for which credit loss was not previously recorded — — 16 — — — — 16

Changes for securities with previously recorded credit loss — — — 2 — — 7 9

Additions for purchases of PCD debt securities (1)

— — — — — — — —

Reductions from charge-offs — — — ( 6 ) — — — ( 6 )

Reductions for securities disposed — — — — ( 2 ) — — ( 2 )

Securities intended/required to be sold before recovery of amortized cost basis — — — — — — — —

Balance at September 30, 2024 (2)

$ — $ — $ 16 $ 9 $ 4 $ — $ 15 $ 44

Three Months Ended September 30, 2023 US

securities Other government securities Public

utilities Corporate securities Residential mortgage-backed Commercial mortgage-backed Other

asset-backed securities Total

Balance at July 1, 2023 $ — $ 3 $ — $ 7 $ 6 $ — $ — $ 16

Additions for which credit loss was not previously recorded — 2 — 15 — 9 — 26

Changes for securities with previously recorded credit loss — — — 2 — — — 2

Additions for purchases of PCD debt securities (1)

— — — — — — — —

Reductions from charge-offs — — — — — — — —

Reductions for securities disposed — — — ( 1 ) — — — ( 1 )

Securities intended/required to be sold before recovery of amortized cost basis — ( 2 ) — ( 6 ) — ( 9 ) — ( 17 )

Balance at September 30, 2023 (2)

$ — $ 3 $ — $ 17 $ 6 $ — $ — $ 26

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

Nine Months Ended September 30, 2024 US

Three Months Ended March 31, 2025 US

securities Other government securities Public

9 unchanged sentences

Securities intended/required to be sold before recovery of amortized cost basis — — — — — ( 1 ) — ( 1 )

Balance at September 30, 2024 (2)

Balance at March 31, 2025 (2)

$ — $ — $ — $ 8 $ 6 $ — $ 26 $ 40

Nine Months Ended September 30, 2023 US

Three Months Ended March 31, 2024 US

securities Other government securities Public

9 unchanged sentences

Securities intended/required to be sold before recovery of amortized cost basis — — — — — — — —

Balance at September 30, 2023 (2)

Balance at March 31, 2024 (2)

$ — $ — $ — $ 13 $ 6 $ — $ 1 $ 20

(1) Represents purchased credit-deteriorated ("PCD") fixed maturity available-for-sale securities.

(2) Accrued interest receivable on debt securities totaled $ 446 million and $ 416 million as of September 30, 2024 and 2023, respectively, and was excluded from the determination of credit losses for the three and nine months ended September 30, 2024 and 2023.

(2) Accrued interest receivable on debt securities totaled $ 448 million and $ 403 million as of March 31, 2025 and 2024, respectively, and was excluded from the determination of credit losses for the three months ended March 31, 2025 and 2024.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

1 unchanged sentence

The sources of net investment income were as follows (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Debt securities (1)

$ 393 $ 432 $ 1,191 $ 1,152

Equity securities 1 2

9 unchanged sentences

Net investment income $ 755 $ 734

(1) Includes changes in fair value gains (losses) on trading securities and includes $( 23 ) million and $( 1 ) million for the three and nine months ended September 30, 2024, respectively, and $ 51 million and $ 43 million for the three and nine months ended September 30, 2023, respectively, related to the change in fair value for securities carried under the fair value option.

(2) In the first quarter of 2024, interest costs principally associated with repurchase agreements and cash collateral were reclassified from interest expense to net investment income.

All prior period amounts have been conformed to current period presentation.

(3) Includes expenses from consolidated variable interest entities, which includes changes in fair value of notes issued by those entities, of $( 44 ) million and $( 150 ) million for the three and nine months ended September 30, 2024, respectively, and $( 70 ) million and $( 144 ) million for the three and nine months ended September 30, 2023, respectively.

Unrealized gains (losses) included in investment income that were recognized on equity securities held were $ 10 million and $( 16 ) million for the three months ended September 30, 2024, and 2023, respectively, and $ 16 million and $( 38 ) million for the nine months ended September 30, 2024 and 2023, respectively.

(1) Includes changes in fair value gains (losses) on trading securities and includes $( 10 ) million and $ 25 million for the three months ended March 31, 2025 and 2024, respectively, related to the change in fair value for securities carried under the fair value option.

(2) Includes expenses from consolidated variable interest entities, which includes changes in fair value of notes issued by those entities, of $( 32 ) million and $( 58 ) million for the three months ended March 31, 2025 and 2024, respectively.

Unrealized gains (losses) included in investment income that were recognized on equity securities held were $( 2 ) million and $ 7 million for the three months ended March 31, 2025 and 2024, respectively.

Net Gains (Losses) on Derivatives and Investments

The following table summarizes net gains (losses) on derivatives and investments (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Available-for-sale securities

1 unchanged sentence

Realized losses on sale ( 12 ) ( 81 )

Credit loss income (expense) ( 11 ) ( 18 ) ( 11 ) ( 29 )

Credit loss income (expense) on mortgage loans ( 11 ) ( 4 )

( 44 ) 10 16 10

Net gains (losses) excluding derivatives and funds withheld assets ( 66 ) ( 7 )

4 unchanged sentences

(1) Includes the foreign currency gain or loss related to foreign denominated trust instruments supporting funding agreements.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

Net gains (losses) on funds withheld reinsurance treaties represents income (loss) from the sale of investments held in segregated funds withheld accounts in support of reinsurance agreements for which Jackson retains legal ownership of the underlying investments.

These gains (losses) are increased or decreased by changes in the embedded derivative liability related to the Athene Life Re Ltd.

("Athene") funds withheld coinsurance agreement (as described in Item 2, the “Athene Reinsurance Transaction”) and also include (i) changes in the related funds withheld payable, as all economic performance of the investments held in the segregated accounts inure to the benefit of the reinsurers under the respective reinsurance agreements with each reinsurer, and (ii) amortization of the difference between book value and fair value of the investments as of the effective date of the reinsurance agreements with each reinsurer.

The aggregate fair value of securities sold at a loss for the three and nine months ended September 30, 2024 was $ 419 million and $ 2,314 million, which was approximately 97 % and 94 % of book value, respectively.

The aggregate fair value of securities sold at a loss for the three and nine months ended September 30, 2023 was $ 756 million and $ 2,909 million, which was approximately 88 % and 94 % of book value, respectively.

Proceeds from sales of available-for-sale debt securities were $ 0.6 billion and $ 3.5 billion during the three and nine months ended September 30, 2024, respectively, and $ 0.9 billion and $ 4.2 billion during the three and nine months ended September 30, 2023, respectively.

("Athene") funds withheld coinsurance agreement (the “Athene Reinsurance Transaction”) and also include (i) changes in the related funds withheld payable, as all economic performance of the investments held in the segregated accounts inure to the benefit of the reinsurers under the respective reinsurance agreements with each reinsurer, and (ii) amortization of the difference between book value and fair value of the investments as of the effective date of the reinsurance agreements with each reinsurer.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

The aggregate fair value of securities sold at a loss for the three months ended March 31, 2025 and 2024 was $ 669 million and $ 1.3 billion, which was approximately 95 % and 93 % of book value, respectively.

Proceeds from sales of available-for-sale debt securities were $ 934 million and $ 1.7 billion during the three months ended March 31, 2025 and 2024, respectively.

Consolidated Variable Interest Entities ("VIEs")

4 unchanged sentences

The Company's policy is to record the consolidation of VIEs on a one-month lag due to the timing of when information is available from the VIE.

In December 2023, a consolidated CLO expanded its issuance by $ 97 million, net of the Company’s holding, which was not reflected in the Company's Consolidated Balance Sheet as of December 31, 2023 due to the reporting lag.

In March 2025, a consolidated VIE issued $ 370 million par, net of the Company’s holding, of collateralized loan obligations, which was not reflected in the Company's Condensed Consolidated Balance Sheet as of March 31, 2025 due to the reporting lag.

• Private Equity Funds III – VIII are limited partnership structures that invest the ownership capital in portfolios of various other limited partnership structures.

Private Equity Fund IX was created in the third quarter of 2024, but is not expected to be funded by the Company until 2025.

The Company sold all of its investment in Private Equity Funds III - VI and the majority of its investment in Private Equity Fund VII during the year ended December 31, 2023.

The Company recorded a loss of $ 97 million on the sale, which it recognized in Net Investment Income for the year ended December 31, 2023.

Those entities were deconsolidated as of December 31, 2023.

Private Equity Fund IX was created in the third quarter of 2024, but is not expected to be funded by the Company until the second half of 2025.

• PPM has created and managed institutional share class mutual funds, where Jackson seeds new funds, or new share classes within a fund, when deemed necessary to develop the requisite track record prior to allowing investment by external parties.

Jackson may sell its interest in a fund once opened to investment by external parties.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

These mutual funds ceased operations during the year ended December 31, 2024.

Asset and liability information for the consolidated VIEs included on the Condensed Consolidated Balance Sheets are as follows (in millions):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Debt securities, at fair value under fair value option $ 2,793 $ 2,429

Debt securities, trading 73 68

Equity securities 6 6

6 unchanged sentences

Total other liabilities 3,039 2,622

Securities lending payable 1 2

Total liabilities $ 3,039 $ 2,622

Noncontrolling interests $ 224 $ 218

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

Unconsolidated VIEs

The Company has concluded the following entities are VIEs but does not consolidate them.

Based on analysis of the limited partnerships ("LPs"), LLCs and the mutual funds, the Company is not the primary beneficiary of the VIE because the Company lacks the power to direct the activities of the VIE that most significantly impact the VIE's performance or lacks the obligation to absorb losses or the right to receive benefits that could potentially be significant to the entities, or both.

• The Company invests in certain LPs and LLCs.

The carrying amounts of the Company’s investments in these LPs and LLCs are recognized in other invested assets on the Condensed Consolidated Balance Sheets.

• The carrying amounts of the Company’s investments in certain LPs and LLCs are recognized in other invested assets on the Condensed Consolidated Balance Sheets.

Unfunded capital commitments for these investments are detailed in Note 16 of the Notes to Condensed Consolidated Financial Statements.

The Company’s exposure to loss is limited to the capital invested and unfunded capital commitments related to the LPs/LLCs, which was $ 2,609 million and $ 2,576 million as of September 30, 2024 and December 31, 2023, respectively.

The Company’s exposure to loss was limited to $ 2,597 million and $ 2,637 million as of March 31, 2025 and December 31, 2024, respectively, representing the aggregate capital invested and unfunded capital commitments related to the LPs/LLCs at those dates.

The capital invested in an LP or LLC equals the original capital contributed, increased for additional capital contributed after the initial investment, and reduced for any returns of capital from the LP or LLC.

LPs and LLCs are carried at fair value.

• The Company invests in certain mutual funds.

Mutual funds are recognized in equity securities on the Condensed Consolidated Balance Sheets and were $ 24 million and $ 21 million as of September 30, 2024 and December 31, 2023, respectively.

• The Company's investments in certain mutual funds are recognized in equity securities on the Condensed Consolidated Balance Sheets and were $ 18 million and $ 19 million as of March 31, 2025 and December 31, 2024, respectively.

The Company’s maximum exposure to loss on these mutual funds is limited to the amortized cost for these investments.

6 unchanged sentences

The Company recognizes the variable interest in these VIEs at fair value on the Condensed Consolidated Balance Sheets.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

Commercial and Residential Mortgage Loans

The following table shows commercial mortgage loans, residential mortgage loans, and the respective accrued interest thereon at September 30, 2024 and December 31, 2023 (in millions):

September 30, 2024 December 31, 2023

The following table shows commercial mortgage loans, residential mortgage loans, and the respective accrued interest thereon (in millions):

March 31, 2025 December 31, 2024

Commercial mortgage loans (1)

5 unchanged sentences

(2) Net of an allowance for credit losses of $ 14 million and $ 5 million at each date, respectively.

At September 30, 2024, commercial mortgage loans were collateralized by properties located in 36 states, the District of Columbia, and Europe, while residential mortgage loans were collateralized by properties located in 49 states, the District of Columbia, Mexico, and Europe.

At March 31, 2025, commercial mortgage loans were collateralized by properties located in 36 states, the District of Columbia, and Europe, while residential mortgage loans were collateralized by properties located in 49 states, the District of Columbia, Mexico, and Europe.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

Evaluation for Credit Losses on Mortgage Loans

13 unchanged sentences

Mortgage loans on real estate are presented net of the ACL on the Condensed Consolidated Balance Sheets.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

The following table provides the change in the allowance for credit losses in the Company’s mortgage loan portfolios (in millions):

Three Months Ended September 30, 2024 Apartment Hotel Office Retail Warehouse Other Residential Mortgage Total

Balance at July 1, 2024 $ 27 $ 5 $ 70 $ 27 $ 19 $ 7 $ 5 $ 160

Charge offs, net of recoveries ( 3 ) — — — — — — ( 3 )

Additions from purchase of PCD mortgage loans — — — — — — — —

Provision (release) ( 4 ) — ( 4 ) 5 ( 1 ) ( 5 ) — ( 9 )

Balance at September 30, 2024 (1) (2)

$ 20 $ 5 $ 66 $ 32 $ 18 $ 2 $ 5 $ 148

Three Months Ended September 30, 2023 Apartment Hotel Office Retail Warehouse Other Residential Mortgage Total

Balance at July 1, 2023 $ 16 $ 7 $ 91 $ 25 $ 12 $ 3 $ 8 $ 162

Charge offs, net of recoveries — — — — — — — —

Additions from purchase of PCD mortgage loans — — — — — — — —

Provision (release) 8 ( 1 ) 30 — 4 — ( 3 ) 38

Balance at September 30, 2023 (1) (2)

$ 24 $ 6 $ 121 $ 25 $ 16 $ 3 $ 5 $ 200

Nine Months Ended September 30, 2024 Apartment Hotel Office Retail Warehouse Other Residential Mortgage Total

Three Months Ended March 31, 2025 Apartment Hotel Office Retail Warehouse Other Residential Mortgage Total

Balance at January 1, 2025 $ 23 $ 7 $ 44 $ 19 $ 20 $ 3 $ 5 $ 121

2 unchanged sentences

Provision (release) 5 — 2 — — ( 1 ) 9 15

Balance at September 30, 2024 (1) (2)

Balance at March 31, 2025 (1) (2)

$ 28 $ 7 $ 40 $ 19 $ 20 $ 2 $ 14 $ 130

Nine Months Ended September 30, 2023 Apartment Hotel Office Retail Warehouse Other Residential Mortgage Total

Three Months Ended March 31, 2024 Apartment Hotel Office Retail Warehouse Other Residential Mortgage Total

Balance at January 1, 2024 $ 28 $ 4 $ 78 $ 27 $ 17 $ 6 $ 5 $ 165

2 unchanged sentences

Provision (release) 2 2 ( 5 ) — — ( 1 ) ( 1 ) ( 3 )

Balance at September 30, 2023 (1) (2)

Balance at March 31, 2024 (1) (2)

$ 30 $ 6 $ 73 $ 27 $ 17 $ 5 $ 4 $ 162

(1) Accrued interest receivable totaled $ 42 million and $ 45 million as of September 30, 2024 and 2023, respectively, and was excluded from the determination of credit losses.

(2) Accrued interest amounting to $ 1 million and $ 2 million was written off as of September 30, 2024 and 2023, respectively, relating to loans that were greater than 90 days delinquent or in the process of foreclosure.

(1) Accrued interest receivable totaled $ 42 million and $ 47 million as of March 31, 2025 and 2024, respectively, and was excluded from the determination of credit losses.

(2) Accrued interest amounting to nil and nil was written off as of March 31, 2025 and 2024, respectively, relating to loans that were greater than 90 days delinquent or in the process of foreclosure.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

The Company’s mortgage loans that are current and in good standing are accruing interest.

1 unchanged sentence

Delinquency status is determined from the date of the first missed contractual payment.

The following table provides information about our impaired residential mortgage loans (in millions):

September 30, 2024 December 31, 2023

The following table provides information about our residential mortgage loans in process of foreclosure (in millions):

March 31, 2025 December 31, 2024

Recorded investment (1)

3 unchanged sentences

Investment income recognized — 1

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

(1) At March 31, 2025 and December 31, 2024, includes $ 3 million and $ 2 million, respectively, of loans in process of foreclosure, all of which are loans supported with insurance or other guarantees provided by various governmental programs.

The following tables provide information about the credit quality with vintage year and category of mortgage loans (dollars in millions):

September 30, 2024

March 31, 2025

2025 2024 2023 2022 2021 Prior Revolving

17 unchanged sentences

Total mortgage loans $ 339 $ 993 $ 783 $ 903 $ 1,076 $ 5,932 $ — $ 10,026 100 %

(1) The loan to value ratio is derived from current loan balance divided by the fair value of the property.

The fair value of the underlying commercial properties is updated annually for each mortgage loan.

(2) The debt service coverage ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

December 31, 2024

18 unchanged sentences

Total mortgage loans $ 986 $ 816 $ 916 $ 1,102 $ 749 $ 5,338 $ 4 $ 9,911 100 %

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

September 30, 2024

In Good Standing (1)

Restructured Greater than 90 Days Delinquent In the Process of Foreclosure Total Carrying Value

(1) The loan to value ratio is derived from current loan balance divided by the fair value of the property.

The fair value of the underlying commercial properties is updated annually for each mortgage loan.

(2) The debt service coverage ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.

Accruing Loans (1)

March 31, 2025 Current 30-89 Days Past Due (2)

90 Days or Greater Past Due (2)

Non-accrual Loans (1)

Total Loans (1)

Non-accrual Loans with No Allowance (1)

Interest Income on Non-accrual Loans

Apartment $ 2,510 $ — $ — $ — $ 2,510 $ — $ —

8 unchanged sentences

Total $ 9,855 $ 203 $ 20 $ 78 10,156 $ — $ —

December 31, 2023

In Good Standing (1)

Restructured Greater than 90 Days Delinquent In the Process of Foreclosure Total Carrying Value

Total with ACL $ 10,026

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

Accruing Loans (1)

December 31, 2024 Current 30-89 Days Past Due (2)

90 Days or Greater Past Due (2)

Non-accrual Loans (1)

Total Loans (1)

Non-accrual Loans with No Allowance (1)

Interest Income on Non-accrual Loans

Apartment $ 2,450 $ — $ — $ — $ 2,450 $ — $ —

8 unchanged sentences

Total $ 9,775 $ 154 $ 24 $ 79 $ 10,032 $ — $ 2

(1) At September 30, 2024 and December 31, 2023, includes mezzanine and bridge loans in good standing of $ 350 million and $ 368 million in the Apartment category, $ 27 million and $ 21 million in the Hotel category, $ 138 million and $ 171 million in the Office category, $ 32 million and $ 32 million in the Retail category, $ 268 million and $ 287 million in the Warehouse category, and $ 23 million and $ 48 million in the Other category, respectively.

At September 30, 2024 and December 31, 2023, includes restructured mezzanine and bridge loans of $ 24 million and nil in the Office category.

(2) At September 30, 2024 and December 31, 2023, includes $ 18 million and $ 22 million of loans purchased when the loans were greater than 90 days delinquent and $ 3 million and $ 5 million of loans in process of foreclosure, all of which are loans supported with insurance or other guarantees provided by various governmental programs, respectively.

Total with ACL $ 9,911

(1) Amortized cost or fair value for loans carried at fair value under the fair value option.

(2) At March 31, 2025 and December 31, 2024, includes $ 24 million and $ 24 million, respectively, of loans 30-89 days past due and $ 20 million and $ 24 million, respectively, of loans 90 days or greater past due and supported with insurance or other guarantees provided by various governmental programs.

The following table provides information about the mortgage loans modified during the periods indicated to borrowers experiencing financial difficulty (dollars in millions):

1 unchanged sentence

Cost Basis Percent of

Three Months Ended September 30, 2024

Commercial mortgage loans $ — — %

Three Months Ended September 30, 2023

Commercial mortgage loans $ — — %

Term Extension

Cost Basis Percent of

Nine Months Ended September 30, 2024

Three Months Ended March 31, 2025

Commercial mortgage loans $ — — %

Nine Months Ended September 30, 2023

Three Months Ended March 31, 2024

Commercial mortgage loans $ 27 0.28 %

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

As of March 31, 2025, the above modified loans had no unfunded commitment.

The following table describes the financial effect of the modifications made to the loans noted above:

1 unchanged sentence

Financial Effect

Nine Months Ended September 30, 2024

Commercial mortgage loans Granted extension of term for three -years and required partial principal repayment at extension of the loan.

Nine Months Ended September 30, 2023

Commercial mortgage loans Granted extension of term for three -years and required partial principal repayment at extension of the loan.

Three Months Ended March 31, 2024

Commercial mortgage loans Granted extension of term for three -years and rate converted from variable to 4 % fixed.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

The Company closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.

2 unchanged sentences

Current 30-89 Days Past Due 90+ Days Past Due

September 30, 2024

March 31, 2025

Commercial mortgage loans $ — $ — $ —

September 30, 2023

March 31, 2024

Commercial mortgage loans $ 43 $ — $ —

As of September 30, 2024 and 2023, stressed mortgage loans for which the Company is dependent, or expects to be dependent, on the underlying property to satisfy repayment were $ 29 million and $ 16 million, respectively.

As of March 31, 2025 and 2024, stressed mortgage loans for which the Company is dependent, or expects to be dependent, on the underlying property to satisfy repayment were $ 29 million and $ 19 million, respectively.

Policy loans are loans the Company issues to contract holders that use the cash surrender value of their life insurance policy or annuity contract as collateral.

At September 30, 2024 and December 31, 2023, $ 3.5 billion and $ 3.5 billion of these loans were carried at fair value, which the Company believes is equal to unpaid principal balances, plus accrued investment income.

At September 30, 2024 and December 31, 2023, the Company had $ 0.9 billion and $ 0.9 billion, respectively, of policy loans not held as collateral for reinsurance, which were carried at the unpaid principal balances.

At March 31, 2025 and December 31, 2024, $ 3.5 billion and $ 3.5 billion of these loans were carried at fair value, which the Company believes is equal to unpaid principal balances, plus accrued investment income.

At March 31, 2025 and December 31, 2024, the Company had $ 0.9 billion and $ 0.9 billion, respectively, of policy loans not held as collateral for reinsurance, which were carried at the unpaid principal balances.

Other Invested Assets

1 unchanged sentence

FHLBI capital stock is carried at cost and adjusted for any impairment.

At September 30, 2024 and December 31, 2023, FHLB capital stock had a carrying value of $ 127 million and $ 108 million, respectively.

At March 31, 2025 and December 31, 2024, FHLB capital stock had a carrying value of $ 102 million and $ 127 million, respectively.

Real estate is carried at the lower of depreciated cost or fair value and real estate occupied by the Company is carried at depreciated cost.

At September 30, 2024 and December 31, 2023, real estate totaling $ 227 million and $ 226 million, respectively, included foreclosed properties with a book value of $ 8 million and $ 6 million at September 30, 2024 and December 31, 2023, respectively.

At March 31, 2025 and December 31, 2024, real estate totaling $ 231 million and $ 232 million, respectively, included foreclosed properties with a book value of $ 15 million and $ 14 million at March 31, 2025 and December 31, 2024, respectively.

Carrying values for LP investments are generally determined by using the proportion of the Company’s investment in each fund (Net Asset Value (“NAV”) equivalent) as a practical expedient for fair value, and generally are recorded on a three-month lag, with changes in value included in net investment income.

At September 30, 2024 and December 31, 2023, investments in LPs had carrying values of $ 2.4 billion and $ 2.1 billion, respectively.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

At March 31, 2025 and December 31, 2024, investments in LPs had carrying values of $ 2.5 billion and $ 2.5 billion, respectively.

Securities Lending

The Company has entered into securities lending agreements with agent banks whereby blocks of securities are loaned to third parties, primarily major brokerage firms.

As of September 30, 2024 and December 31, 2023, the estimated fair value of loaned securities was $ 25 million and $ 19 million, respectively.

As of March 31, 2025 and December 31, 2024, the estimated fair value of loaned securities was $ 69 million and $ 13 million, respectively.

The agreements require a minimum of 102 % of the fair value of the loaned securities to be held as collateral, calculated daily.

To further minimize the credit risks related to these programs, the financial condition of counterparties is monitored on a regular basis.

At September 30, 2024 and December 31, 2023, cash collateral received in the amount of $ 26 million and $ 19 million, respectively, was invested by the agent banks and included in cash and cash equivalents of the Company.

At March 31, 2025 and December 31, 2024, cash collateral received in the amount of $ 72 million and $ 14 million, respectively, was invested by the agent banks and included in cash and cash equivalents of the Company.

A securities lending payable for the overnight and continuous loans is included in liabilities in the amount of cash collateral received.

1 unchanged sentence

Income and expenses associated with these transactions are reported as net investment income.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4.

Repurchase Agreements

1 unchanged sentence

These agreements are accounted for as financing transactions, with the assets and associated liabilities included in the Condensed Consolidated Balance Sheets.

At September 30, 2024 and December 31, 2023, the outstanding repurchase agreement balance was $ 794 million and nil , respectively, collateralized with U.S.

Treasury securities and corporate securities, of which $ 803 million and nil , respectively, was maturing within 30 days, and was included within repurchase agreements and securities lending payable in the Condensed Consolidated Balance Sheets.

At March 31, 2025 and December 31, 2024, the outstanding repurchase agreement balance was $ 1.0 billion and $ 1.5 billion, respectively, having maturities within 30 days, and was included within repurchase agreements and securities lending payable in the Condensed Consolidated Balance Sheets.

These repurchase agreements were collateralized with U.S.

Treasury securities and corporate securities of $ 1.0 billion and $ 1.5 billion, respectively, at March 31, 2025 and December 31, 2024.

In the event of a decline in the fair value of the pledged collateral under these agreements, the Company may be required to transfer cash or additional securities as pledged collateral.

Interest expense totaled $ 13 million and $ 54 million for the three and nine months ended September 30, 2024, respectively, and $ 16 million and $ 41 million for the three and nine months ended September 30, 2023, respectively, and is included within net investment income.

Interest expense totaled $ 12 million and $ 19 million for the three months ended March 31, 2025 and 2024, respectively, and is included within net investment income.

Collateral Upgrade Transactions

During the first quarter of 2024, Jackson executed certain paired repurchase and reverse repurchase transactions (“collateral upgrade” transactions) totaling $ 1.5 billion pursuant to master repurchase agreements with participating bank counterparties.

Under these collateral upgrade transactions, the Company lends securities (e.g., corporate debt securities or other securities agreed upon between the parties) to bank counterparties in exchange for U.S.

During the first quarter of 2024, Jackson executed certain paired repurchase and reverse repurchase transactions totaling $ 1.5 billion pursuant to master repurchase agreements with participating bank counterparties.

Under these transactions, the Company lends securities ( e.g.

, corporate debt securities) to bank counterparties in exchange for U.S.

Treasury securities that the Company then uses to provide as collateral.

The paired repurchase and reverse repurchase transactions are settled on a net basis in accordance with master repurchase agreements.

The paired repurchase and reverse repurchase transactions are settled on a net basis.

As a result, there was no cash exchanged at initiation of these agreements.

The paired transactions are reported net within the Condensed Consolidated Balance Sheets.

These transactions do not have a stated maturity and require at least 150 -days' notice prior to termination.

At September 30, 2024 and December 31, 2023, the fair value of the U.S.

treasuries received was $ 1.6 billion and nil , respectively, collateralized with corporate securities with a fair value of $ 1.6 billion and nil , respectively.

These transactions are evergreened and require at least 150 -days' notice prior to termination.

At March 31, 2025 and December 31, 2024, the fair value of the U.S.

treasuries received was $ 1.5 billion and $ 1.5 billion, respectively, collateralized with corporate securities with a fair value of $ 1.6 billion and $ 1.6 billion, respectively.

Subsequently, the Company provided these U.S.

1 unchanged sentence

In the event of a decline in the fair value of the pledged collateral under these agreements, the Company may be required to transfer cash or additional securities as pledged collateral.

Gross interest income of $ 32 million and nil and gross interest expense of $ 36 million and nil for the three months ended September 30, 2024, and 2023, respectively, and gross interest income of $ 53 million and nil and gross interest expense of $ 59 million and nil for the nine months ended September 30, 2024 and 2023, respectively, are included within net investment income.

Gross interest income of $ 16 million and $ 12 million and gross interest expense of $ 19 million and $ 13 million for the three months ended March 31, 2025 and 2024, respectively, are included within net investment income.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5.

7 unchanged sentences

A summary of the aggregate contractual or notional amounts and fair values of the Company’s freestanding and embedded derivative instruments are as follows (in millions):

September 30, 2024

March 31, 2025

Contractual/ Assets Liabilities Net

3 unchanged sentences

Cross-currency swaps $ 1,651 $ 129 $ 126 $ 3

Equity index call options 1,000 36 — 36

Equity index futures (2)

1 unchanged sentence

Interest rate swaps 4,978 3 99 ( 96 )

Put-swaptions 3,500 11 141 ( 130 )

Interest rate futures (2)

Total return swaps 1,951 23 11 12

Bond forwards 4,263 104 9 95

Total freestanding derivatives 89,013 552 245 307

13 unchanged sentences

(1) The notional amount for swaps and swaptions represents the stated principal balance used as a basis for calculating payments.

The contractual amount for futures and options represents the market exposure of open positions.

The contractual amount for futures, forwards, and options represents the market exposure of open positions.

(2) Variation margin is considered settlement resulting in the netting of cash received/paid for variation margin against the fair value of the trades.

13 unchanged sentences

Interest rate swaps 5,978 3 177 ( 174 )

Put-swaptions 23,500 153 905 ( 752 )

Interest rate futures (2)

Total return swaps 2,065 39 — 39

Bond forwards 609 — 21 ( 21 )

Total freestanding derivatives 74,073 240 349 ( 109 )

13 unchanged sentences

(1) The notional amount for swaps and swaptions represents the stated principal balance used as a basis for calculating payments.

The contractual amount for futures and options represents the market exposure of open positions.

The contractual amount for futures, forwards, and options represents the market exposure of open positions.

(2) Variation margin is considered settlement resulting in the netting of cash received/paid for variation margin against the fair value of the trades.

5 unchanged sentences

The following table reflects the results of the Company’s derivatives, including gains (losses) and change in fair value of freestanding derivative instruments and embedded derivatives (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Derivatives excluding funds withheld under reinsurance treaties

Cross-currency swaps $ 27 $ ( 59 )

Equity index call options 29 ( 192 ) 29 ( 100 )

Equity index futures 147 ( 903 )

1 unchanged sentence

Interest rate swaps 28 ( 74 )

Interest rate swaps - cleared — — — ( 10 )

Put-swaptions — ( 477 )

1 unchanged sentence

Total return swaps 112 ( 147 )

Bond forwards 115 —

Fixed index annuity embedded derivatives ( 1 ) ( 1 )

8 unchanged sentences

All the Company’s trade agreements for freestanding, over-the-counter derivatives contain credit downgrade provisions that allow a party to assign or terminate derivative transactions if the counterparty’s credit rating declines below an established limit.

At September 30, 2024 and December 31, 2023, the fair value of the Company’s net non-cleared, over-the-counter derivative assets by counterparty were $ 139 million and $ 117 million, respectively, and held collateral was $ 139 million and $ 841 million, respectively, related to these agreements.

At September 30, 2024 and December 31, 2023, the fair value of the Company’s net non-cleared, over-the-counter derivative liabilities by counterparty were $ 269 million and $ 937 million, respectively, and provided collateral was $ 297 million and $ 751 million, respectively, related to these agreements.

If all the downgrade provisions had been triggered at September 30, 2024 and December 31, 2023, in aggregate, the Company would have had to disburse nil and $ 910 million, respectively, and would have been allowed to claim $ 28 million and nil , respectively.

The Company pledged collateral of $ 1,954 million and $ 2,616 million as of September 30, 2024 and December 31, 2023, respectively, for initial margin related to uncleared margin for over-the-counter derivatives and exchange-traded futures.

At March 31, 2025 and December 31, 2024, the fair value of the Company’s net non-cleared, over-the-counter derivative assets by counterparty were $ 436 million and $ 203 million, respectively, and held collateral was $ 495 million and $ 252 million, respectively, related to these agreements.

At March 31, 2025 and December 31, 2024, the fair value of the Company’s net non-cleared, over-the-counter derivative liabilities by counterparty were $ 105 million and $ 267 million, respectively, and provided collateral was $ 174 million and $ 302 million, respectively, related to these agreements.

If all the downgrade provisions had been triggered at March 31, 2025 and December 31, 2024, in aggregate, the Company would have had to disburse $ 59 million and $ 49 million, respectively, and would have been allowed to claim $ 69 million and $ 35 million, respectively.

The Company pledged collateral of $ 1,389 million and $ 1,780 million as of March 31, 2025 and December 31, 2024, respectively, for initial margin related to uncleared margin for over-the-counter derivatives and exchange-traded futures.

Variation margin on exchange traded futures is settled through the netting of cash paid/received for variation margin against the fair value of the trades.

6 unchanged sentences

The following tables present the gross and net information about the Company’s financial instruments subject to master netting arrangements (in millions):

September 30, 2024

March 31, 2025

Recognized Gross

12 unchanged sentences

Freestanding derivative liabilities $ 256 $ — $ 256 $ 151 $ 1 $ 104 $ —

Securities loaned 26 — 26 — 26 — —

Securities lending 72 — 72 — 72 — —

Repurchase agreements 963 — 963 — — 963 —

19 unchanged sentences

Freestanding derivative liabilities $ 361 $ — $ 361 $ 95 $ — $ 215 $ 51

Securities loaned 19 — 19 — 19 — —

Securities lending 14 — 14 — 14 — —

Repurchase agreements 1,540 — 1,540 — — 1,540 —

Repurchase agreements - Collateral upgrade 1,476 ( 1,476 ) — — — — —

Total financial liabilities $ 3,391 $ ( 1,476 ) $ 1,915 $ 95 $ 14 $ 1,755 $ 51

3 unchanged sentences

The actual amount of collateral may be greater than amounts presented in the tables.

The above tables exclude net embedded derivative liabilities of $ 3,624 million and $ 2,090 million as of September 30, 2024 and December 31, 2023, respectively, as these derivatives are not subject to master netting arrangements.

The above tables also exclude the funds withheld embedded derivative asset (liability) of $ 1,992 million and $ 2,468 million at September 30, 2024 and December 31, 2023, respectively.

The above tables exclude net embedded derivative liabilities of $ 3,650 million and $ 3,942 million as of March 31, 2025 and December 31, 2024, respectively, as these derivatives are not subject to master netting arrangements.

The above tables also exclude the funds withheld embedded derivative asset (liability) of $ 2,112 million and $ 2,314 million at March 31, 2025 and December 31, 2024, respectively.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

2 unchanged sentences

The following table summarizes the fair value and carrying value of the Company’s financial instruments (in millions):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Value Carrying

29 unchanged sentences

Repurchase agreements (4)

963 963 1,540 1,540

FHLB advances (5)

Separate account liabilities 217,572 217,572 229,143 229,143

(1) Includes items carried at fair value under the fair value option and trading securities included as a component of debt securities.

(2) Annuity reserves represent only the components of other contract holder funds and reserves for future policy benefits and claims payable that are considered to be financial instruments.

(1) Includes items carried at fair value under the fair value option included as a component of debt securities.

(2) Annuity reserves exclude contracts classified as insurance contracts.

(3) Included as a component of other contract holder funds on the Condensed Consolidated Balance Sheets.

(4) Included as a component of repurchase agreements and securities lending payable on the Condensed Consolidated Balance Sheets.

(5) Included as a component of other liabilities on the Condensed Consolidated Balance Sheets.

The following is a discussion of the methodologies used to determine fair values of the financial instruments measured on a recurring basis reported in the following tables.

23 unchanged sentences

As a result of this analysis, if the Company determines there is a more appropriate fair value based upon the available market data, the price received from the third party may be adjusted accordingly.

For those securities that were internally valued at September 30, 2024 and December 31, 2023, the pricing model used by the Company utilizes current spread levels of similarly rated securities to determine the market discount rate for the security.

For those securities that were internally valued at March 31, 2025 and December 31, 2024, the pricing model used by the Company utilizes current spread levels of similarly rated securities to determine the market discount rate for the security.

Furthermore, appropriate risk premiums for illiquidity and non-performance are incorporated in the discount rate.

5 unchanged sentences

Fair values for limited partnership interests, which are included in other invested assets, are generally determined using the proportion of the Company’s investment in the value of the net assets of each fund (“NAV equivalent”) as a practical expedient for fair value, and generally are recorded on a three-month lag.

No adjustments to these amounts were deemed necessary at September 30, 2024 and December 31, 2023.

No adjustments to these amounts were deemed necessary at March 31, 2025 and December 31, 2024.

As a result of using the net asset value per share practical expedient, limited partnership interests are not classified in the fair value hierarchy.

7 unchanged sentences

These investments are classified as Level 3 in the fair value hierarchy.

Policy loans are funds provided to policyholders in return for a claim on the policies values and function like demand deposits, which are redeemable upon repayment, death or surrender, and there is only one market price at which the transaction could be settled – the then current carrying value.

The funds provided are limited to the cash surrender value of the underlying policy.

The nature of policy loans is to have a negligible default risk as the loans are fully collateralized by the value of the policy.

Policy loans are funds provided to policyholders in return for a claim on the policies' values.

They are repaid upon repayment, death or surrender, and there is only one market price at which the loans could be settled – the then current carrying value.

The loans are limited to, and fully collateralized by, the cash surrender value of the underlying policy.

The nature of policy loans is to have a negligible default risk.

Policy loans do not have a stated maturity and the balances and accrued interest are repaid either by the policyholder or with proceeds from the policy.

8 unchanged sentences

• Level 1 include futures, which are traded on active exchanges.

• Level 2 include interest rate swaps, cross currency swaps, cross-currency forwards, credit default swaps, total return swaps, put-swaptions and certain equity index call and put options.

• Level 2 include interest rate swaps, cross currency swaps, credit default swaps, total return swaps, bond forwards, put-swaptions and certain equity index call and put options.

These derivative valuations are determined by third-party pricing services using pricing models with inputs that are observable in the market or can be derived principally from, or corroborated by, observable market data.

7 unchanged sentences

Funds Withheld Payable Under Reinsurance Treaties

The funds withheld payable under reinsurance treaties includes both the funds withheld payable that are held at fair value under the fair value option and the funds withheld embedded derivative.

The funds withheld payable under reinsurance treaties includes both the funds withheld payable that is held at fair value under the fair value option and the funds withheld embedded derivative.

Both are considered Level 3 in the fair value hierarchy.

27 unchanged sentences

Estimating these cash flows requires numerous estimates and subjective judgments related to capital market inputs, as well as actuarially determined assumptions related to expectations concerning policyholder behavior.

Capital market inputs include expected market rates of return, market volatility, correlations of market index returns to fund returns, and discount rates, which includes an adjustment for non-performance risk.

Capital market inputs include expected market rates of return, market volatility, correlations of market index returns to fund returns, and discount rates, which include an adjustment for non-performance risk.

The more significant actuarial assumptions include benefit utilization by policyholders, lapse, mortality, and withdrawal rates.

1 unchanged sentence

At each valuation date, the fair value calculation reflects expected returns based on treasury rates as of that date to determine the value of expected future cash flows produced in a stochastic process.

Volatility assumptions are based on a weighting of available market data for implied market volatility for durations up to 10 years, grading to a historical volatility level by year 15, where such long-term historical volatility levels contain an explicit risk margin.

Volatility assumptions are based on available market data for implied market volatility for durations up to 5 years, grading to a historical volatility level by year 10, where such long-term historical volatility levels contain an explicit risk margin.

Non-performance risk is incorporated into the calculation through the adjustment of the risk-free rate curve based on credit spreads for debt and debt-like instruments issued by the Company or its insurance operating subsidiaries, adjusted, as necessary, to reflect the financial strength ratings of the issuing insurance subsidiaries.

1 unchanged sentence

Estimates of future policyholder behavior are subjective and are based primarily on the Company’s experience.

As markets change, mature and evolve and actual policyholder behavior emerges, management continually evaluates the appropriateness of its assumptions for the fair value model.

As markets change, mature and evolve and actual policyholder behavior emerges, management evaluates the appropriateness of its assumptions for the fair value model.

The use of the models and assumptions described above requires a significant amount of judgment.

22 unchanged sentences

Fair Value Option

The Company elected the fair value option for debt securities related to certain consolidated investments totaling $ 2,459 million and $ 2,037 million at September 30, 2024 and December 31, 2023, respectively.

The Company elected the fair value option for debt securities related to certain consolidated investments totaling $ 2,793 million and $ 2,429 million at March 31, 2025 and December 31, 2024, respectively.

These debt securities are reflected on the Company’s Condensed Consolidated Balance Sheets as debt securities, at fair value under the fair value option.

1 unchanged sentence

The Company elected the fair value option on these debt securities, with changes in fair value reflected in net income, to align with the corresponding changes in the value of the market risk benefits recognized through net income.

These debt securities totaling $ 323 million and nil at September 30, 2024 and December 31, 2023, respectively, are presented as debt securities, at fair value under the fair value option in the Condensed Consolidated Balance Sheets.

The Company has elected the fair value option for certain funds withheld assets, which are held as collateral for reinsurance, totaling $ 4,121 million and $ 4,054 million at September 30, 2024 and December 31, 2023, respectively, as discussed above, and includes mortgage loans as discussed below.

These debt securities totaling $ 525 million and $ 501 million at March 31, 2025 and December 31, 2024, respectively, are presented as debt securities, at fair value under the fair value option in the Condensed Consolidated Balance Sheets.

The Company has elected the fair value option for certain funds withheld assets, which are held as collateral for reinsurance, totaling $ 4,055 million and $ 4,054 million at March 31, 2025 and December 31, 2024, respectively, as discussed above, and includes mortgage loans as discussed below.

The Company elected the fair value option for certain mortgage loans held under the funds withheld reinsurance agreement with Athene.

2 unchanged sentences

The fair value and aggregate contractual principal for mortgage loans where the fair value option was elected after December 31, 2021, were as follows (in millions):

September 30, December 31,

March 31, December 31,

Fair value $ 451 $ 449

Aggregate contractual principal 462 464

As of September 30, 2024, no loans in good standing for which the fair value option was elected were in non-accrual status, and no loans were more than 90 days past due and still accruing interest.

The Company elected the fair value option for notes issued by consolidated VIEs totaling $ 2,366 million and $ 1,988 million at September 30, 2024 and December 31, 2023, respectively.

As of March 31, 2025, no loans in good standing for which the fair value option was elected were in non-accrual status, and no loans were more than 90 days past due and still accruing interest.

The Company elected the fair value option for notes issued by consolidated VIEs totaling $ 2,303 million and $ 2,343 million at March 31, 2025 and December 31, 2024, respectively.

Income and changes in unrealized gains and losses on other assets for which the Company has elected the fair value option are immaterial to the Company’s Condensed Consolidated Financial Statements.

3 unchanged sentences

The following tables summarize the Company’s assets and liabilities that are carried at fair value by hierarchy levels (in millions):

September 30, 2024

March 31, 2025

Total Level 1 Level 2 Level 3

66 unchanged sentences

The table below presents the balances of Level 3 assets and liabilities measured at fair value with their corresponding pricing sources (in millions):

September 30, 2024

March 31, 2025

Assets Total Internal External

Debt securities:

Other government securities

$ 300 $ — $ 300

Public utilities

Other asset-backed securities

14 unchanged sentences

Debt securities:

Other government securities $ 150 $ — $ 150

Public utilities $ 44 $ 44 $ —

16 unchanged sentences

Quantitative Information Regarding Internally-Priced Level 3 Assets and Liabilities

The table below presents quantitative information on internally-priced Level 3 assets and liabilities that use significant unobservable inputs (in millions):

As of September 30, 2024

The table below presents quantitative information on internally-priced Level 3 assets and liabilities that use significant unobservable inputs (dollar amounts in millions):

As of March 31, 2025

Value Valuation Technique(s) Significant Unobservable Input(s) Assumption or Input Range Impact of Increase in Input on Fair Value

33 unchanged sentences

A mortality improvement assumption is also applied.

(2) Base lapse rates vary by contract-level factors, such as product type, surrender charge schedule and optional benefits election.

(2) Base lapse rates vary by contract-level factors, such as product type, surrender charge schedule and guaranteed benefits election.

Lapse rates are further adjusted based on the degree to which a guaranteed benefit is in-the-money, with lower lapse applying when benefits are more in-the-money.

44 unchanged sentences

A mortality improvement assumption is also applied.

(2) Base lapse rates vary by contract-level factors, such as product type, surrender charge schedule and optional benefits election.

(2) Base lapse rates vary by contract-level factors, such as product type, surrender charge schedule and guaranteed benefits election.

Lapse rates are further adjusted based on the degree to which a guaranteed benefit is in-the-money, with lower lapse applying when benefits are more in-the-money.

11 unchanged sentences

The following is a general description of sensitivities of significant unobservable inputs and their impact on the fair value measurement for the assets and liabilities reflected in the tables above.

At September 30, 2024 and December 31, 2023, securities of $ 46 million and $ 93 million, respectively, are fair valued using techniques incorporating unobservable inputs and are classified in Level 3 of the fair value hierarchy.

At March 31, 2025 and December 31, 2024, securities of $ 137 million and $ 121 million, respectively, of debt securities, equity securities, and limited partnerships are fair valued using techniques incorporating unobservable inputs and are classified in Level 3 of the fair value hierarchy.

For these assets, their unobservable inputs and ranges of possible inputs do not materially affect their fair valuations and have been excluded from the quantitative information in the tables above.

13 unchanged sentences

Best estimate assumptions plus risk margins are used as applicable.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

The tables below provide roll-forwards for the three and nine months ended September 30, 2024 and 2023 of the financial instruments for which significant unobservable inputs (Level 3) are used in the fair value measurement.

The tables below provide roll-forwards for the three months ended March 31, 2025 and 2024 of the financial instruments for which significant unobservable inputs (Level 3) are used in the fair value measurement.

Gains and losses in the tables below include changes in fair value due partly to observable and unobservable factors.

2 unchanged sentences

Therefore, the impact of the derivative instruments reported in Level 3 may vary significantly from the total income effect of the hedged instruments.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

Total Realized/Unrealized Gains (Losses) Included in

1 unchanged sentence

as of Net Other Issuances in and/or as of

July 1, Income Comprehensive and (out of) September 30,

Three Months Ended September 30, 2024 2024 (Loss) Income (Loss) Settlements Level 3 2024

January 1, Income Comprehensive and (out of) March 31,

Three Months Ended March 31, 2025 2025 (Loss) Income (Loss) Settlements Level 3 2025

Debt securities

Other government securities $ 151 $ — $ 5 $ — $ — $ 156

Public utilities $ 44 $ — $ — $ ( 44 ) $ — $ —

12 unchanged sentences

as of Net Other Issuances in and/or as of

July 1, Income Comprehensive and (out of) September 30,

Three Months Ended September 30, 2023 2023 (Loss) Income (Loss) Settlements Level 3 2023

Debt securities

Corporate securities $ 21 $ ( 2 ) $ — $ 22 $ 3 $ 44

Equity securities 86 ( 2 ) — — — 84

Mortgage loans 509 ( 5 ) — ( 28 ) — 476

Limited partnerships 422 ( 17 ) — ( 10 ) 29 424

Policy loans 3,438 ( 32 ) — 26 — 3,432

Reinsurance recoverable on market risk benefits 194 ( 27 ) — — — 167

Market risk benefit assets 5,957 858 — — — 6,815

Funds withheld payable under reinsurance treaties ( 701 ) 481 — ( 27 ) — ( 247 )

Market risk benefit liabilities ( 4,463 ) 1,545 ( 999 ) — — ( 3,917 )

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

Total Realized/Unrealized Gains (Losses) Included in

Fair Value Sales, Transfers Fair Value

as of Net Other Issuances in and/or as of

January 1, Income Comprehensive and (out of) September 30,

Nine Months Ended September 30, 2024 2024 (Loss) Income (Loss) Settlements Level 3 2024

January 1, Income Comprehensive and (out of) March 31,

Three Months Ended March 31, 2024 2024 (Loss) Income (Loss) Settlements Level 3 2024

Debt securities

11 unchanged sentences

Market risk benefit liabilities ( 4,785 ) 1,452 ( 510 ) — — ( 3,843 )

Total Realized/Unrealized Gains (Losses) Included in

Fair Value Sales, Transfers Fair Value

as of Net Other Issuances in and/or as of

January 1, Income Comprehensive and (out of) September 30,

Nine Months Ended September 30, 2023 2023 (Loss) Income (Loss) Settlements Level 3 2023

Debt securities

Corporate securities $ 56 $ ( 11 ) $ — $ 18 $ ( 19 ) $ 44

Equity securities 122 ( 37 ) — — ( 1 ) 84

Mortgage loans 582 ( 7 ) — ( 99 ) — 476

Limited partnerships 440 ( 39 ) — 1 22 424

Policy loans 3,419 75 — ( 62 ) — 3,432

Reinsurance recoverable on market risk benefits 221 ( 54 ) — — — 167

Market risk benefit assets 4,865 1,950 — — — 6,815

Funds withheld payable under reinsurance treaties ( 424 ) 119 — 58 — ( 247 )

Market risk benefit liabilities ( 5,662 ) 3,224 ( 1,479 ) — — ( 3,917 )

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

The components of the amounts included in purchases, sales, issuances and settlements for the three and nine months ended September 30, 2024 and 2023 shown above are as follows (in millions):

Three Months Ended September 30, 2024 Purchases Sales Issuances Settlements Total

The components of the amounts included in purchases, sales, issuances and settlements for the three months ended March 31, 2025 and 2024 shown above are as follows (in millions):

Three Months Ended March 31, 2025 Purchases Sales Issuances Settlements Total

Debt securities

7 unchanged sentences

Funds withheld payable under reinsurance treaties $ — $ — $ ( 116 ) $ 102 $ ( 14 )

Three Months Ended September 30, 2023 Purchases Sales Issuances Settlements Total

Debt securities

Corporate securities $ 27 $ ( 5 ) $ — $ — $ 22

Mortgage loans 45 ( 73 ) — — ( 28 )

Limited partnerships 1 ( 11 ) — — ( 10 )

Policy loans — — 76 ( 50 ) 26

Total $ 73 $ ( 89 ) $ 76 $ ( 50 ) $ 10

Funds withheld payable under reinsurance treaties $ — $ — $ ( 96 ) $ 69 $ ( 27 )

Nine Months Ended September 30, 2024 Purchases Sales Issuances Settlements Total

Three Months Ended March 31, 2024 Purchases Sales Issuances Settlements Total

Debt securities

3 unchanged sentences

Mortgage loans 48 ( 72 ) — — ( 24 )

Limited partnerships 18 — — — 18

Policy loans — — 63 ( 101 ) ( 38 )

1 unchanged sentence

Funds withheld payable under reinsurance treaties $ — $ — $ ( 160 ) $ 197 $ 37

Nine Months Ended September 30, 2023 Purchases Sales Issuances Settlements Total

Debt securities

Corporate securities $ 27 $ ( 9 ) $ — $ — $ 18

Mortgage loans 180 ( 279 ) — — ( 99 )

Limited partnerships 19 ( 18 ) — — 1

Policy loans — — 111 ( 173 ) ( 62 )

Total $ 226 $ ( 306 ) $ 111 $ ( 173 ) $ ( 142 )

Funds withheld payable under reinsurance treaties $ — $ — $ ( 132 ) $ 190 $ 58

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

For the three and nine months ended September 30, 2024, transfers from Level 3 to Level 2 of the fair value hierarchy were $ 18 million and $ 34 million, respectively, transfers from Level 2 to Level 3 were $ 63 million and $ 67 million, respectively, and transfers from Level 3 to NAV were nil and nil , respectively.

For the three and nine months ended September 30, 2023, transfers from Level 3 to Level 2 of the fair value hierarchy were $( 12 ) million and $ 19 million, respectively, transfers from Level 2 to Level 3 were $( 9 ) million and $( 1 ) million, respectively, and transfers from Level 3 to NAV were $( 29 ) million and $( 22 ) million, respectively.

During 2023, management determined that the fair value measurements for certain securities, primarily comprised of asset-backed and other debt securities included in funds withheld accounts, which were classified as Level 2 measurements within the fair value hierarchy in prior reporting periods, should be classified as Level 3 fair value measurements.

The fair value of these securities is primarily obtained from external sources which may use unobservable inputs, proprietary inputs and models, or inputs or values that cannot be corroborated by market transactions and should be classified as externally priced Level 3 fair value measurements.

The 2023 Fair Value on a Recurring Basis table and the Level 3 Assets and Liabilities by Price Source table reflect this change in classification.

In the fourth quarter of 2023, securities totaling $ 1,336 million that were previously reported as Level 3 were included in “Transfers in and/or (out of) Level 3”.

For the three and nine months ended September 30, 2023, the Level 3 Roll forward table and the Level 3 Purchases, Sales, Issuances, and Settlements tables are shown as previously reported and do not reflect this change in classification.

The change in classification did not change the fair value of these securities and did not impact the Condensed Consolidated Balance Sheets or Condensed Consolidated Income Statements.

For the three months ended March 31, 2025, transfers from Level 3 to Level 2 of the fair value hierarchy were $ 58 million, and transfers from Level 2 to Level 3 were $ 174 million.

For the three months ended March 31, 2024, transfers from Level 3 to Level 2 of the fair value hierarchy were $ 9 million, and transfers from Level 2 to Level 3 were $ 15 million.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

1 unchanged sentence

The portion of gains (losses) included in net income (loss) or OCI attributable to the change in unrealized gains and losses on Level 3 financial instruments still held was as follows (in millions):

Three Months Ended September 30,

Net Income Included in OCI Included in

Net Income Included in OCI

Debt securities

Other government securities $ — $ 5 $ — $ —

Public utilities — ( 12 ) — —

Corporate securities 1 2 2 —

Other asset-backed securities 1 9 — —

Equity securities — — ( 2 ) —

Mortgage loans 4 — ( 5 ) —

Limited partnerships 18 — ( 17 ) —

Policy loans 68 — ( 32 ) —

Reinsurance recoverable on market risk benefits 28 — ( 27 ) —

Market risk benefit assets ( 941 ) — 858 —

Funds withheld payable under reinsurance treaties ( 601 ) — 481 —

Market risk benefit liabilities ( 260 ) ( 234 ) 1,545 ( 999 )

Nine Months Ended September 30,

Three Months Ended March 31,

Net Income Included in OCI Included in

2 unchanged sentences

Other government securities $ — $ — $ — $ 2

Public utilities ( 1 ) ( 11 ) — —

Corporate securities — 4 ( 1 ) —

Other asset-backed securities — ( 3 ) ( 1 ) —

Equity securities — — ( 37 ) —

Mortgage loans 4 — ( 2 ) —

5 unchanged sentences

Market risk benefit liabilities ( 678 ) 327 1,452 ( 510 )

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

Fair Value of Financial Instruments Carried at Other Than Fair Value

The table below presents the carrying amount and fair value by fair value hierarchy level of certain financial instruments that are not reported at fair value (in millions):

September 30, 2024

March 31, 2025

Value Total Level 1 Level 2 Level 3

17 unchanged sentences

217,572 217,572 — 217,572 —

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

December 31, 2024

14 unchanged sentences

Securities lending payable (3)

Repurchase agreements (3)

1,540 1,540 — 1,540 —

FHLB advances (4)

2 unchanged sentences

229,143 229,143 — 229,143 —

(1) Annuity reserves represent only the components of other contract holder funds that are considered to be financial instruments.

(1) Annuity reserves exclude contracts classified as insurance contracts.

(2) Included as a component of other contract holder funds on the Condensed Consolidated Balance Sheets.

2 unchanged sentences

(5) The values of separate account liabilities are set equal to the values of separate account assets.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

The following is a discussion of the methodologies used to determine fair values of the financial instruments that are not reported at fair value reported in the table above:

4 unchanged sentences

As a result, these investments have been classified as Level 3 within the fair value hierarchy.

Mortgage loans held under the funds withheld reinsurance agreement are valued using third-party pricing services, which may use economic inputs, geographical information, and property specific assumptions in deriving the fair value price.

Mortgage loans held under a funds withheld reinsurance agreement are valued using third-party pricing services, which may use economic inputs, geographical information, and property specific assumptions in deriving the fair value price.

The Company reviews the valuations from these pricing providers to ensure they are reasonable.

Due to lack of observable inputs, these investments have been classified as Level 3 within the fair value hierarchy.

Policy loans are funds provided to policyholders in return for a claim on the policies values and function like demand deposits which are redeemable upon repayment, death or surrender, and there is only one market price at which the transaction could be settled – the then current carrying value.

The funds provided are limited to the cash surrender value of the underlying policy.

The nature of policy loans is to have a negligible default risk as the loans are fully collateralized by the value of the policy.

Policy loans do not have a stated maturity and the balances and accrued interest are repaid either by the policyholder or with proceeds from the policy.

Due to the collateralized nature of policy loans and unpredictable timing of payments, the Company believes the carrying value of policy loans approximates fair value.

As described under “Policy Loans” in Note 4 – Investments of the Notes to Condensed Consolidated Financial Statements, due to the collateralized nature of policy loans and unpredictable timing of payments, the Company believes the carrying value of policy loans approximates fair value.

The non-reinsurance related component of policy loans has been classified as Level 3 within the fair value hierarchy.

2 unchanged sentences

Due to the lack of valuation uncertainty, the investment has been classified as Level 1.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

Other Contract Holder Funds

8 unchanged sentences

Such prices are derived from market observable inputs and are classified as Level 2.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6.

Fair Value Measurements

Securities Lending Payable

7 unchanged sentences

The values of separate account liabilities are set equal to the values of separate account assets, which are comprised of investments in mutual funds that transact regularly, but do not trade in active markets as they are not publicly available and are categorized as Level 2.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 7.

Deferred Acquisition Costs

Certain costs that are directly related to the successful acquisition of new or renewal insurance business are capitalized as deferred acquisition costs ("DAC") in the period in which they are incurred.

13 unchanged sentences

Substantially unchanged contracts are treated as a continuation of the replaced contract, with no change to the unamortized DAC at the time of the replacement.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 7.

Deferred Acquisition Costs

The following table presents the roll-forward of the DAC (in millions).

1 unchanged sentence

The amortization pattern is revised on a prospective basis at the beginning of the period based on the period’s actual experience.

Nine Months Ended September 30, Year Ended December 31,

Three Months Ended March 31, Year Ended December 31,

Variable Annuities

7 unchanged sentences

Total balance, end of period $ 11,770 $ 11,887

The Company, through its subsidiary insurance companies, assumes and cedes reinsurance from and to other insurance companies to limit losses from large exposures.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 8.

The Company, through its subsidiary insurance companies, assumes and cedes reinsurance from and to other insurance companies as a means of managing capital and risk exposures.

However, if the reinsurer is unable to meet its obligations, the originating issuer of the coverage retains the liability.

7 unchanged sentences

The profit and loss with respect to obligations ceded to Athene are included in periodic net settlements pursuant to the coinsurance agreement.

To further support its obligations under the coinsurance agreement, Athene procured $ 1.2 billion in letters of credit for Jackson’s benefit and established a trust account for Jackson’s benefit, which had a book value of approximately $ 80 million at September 30, 2024.

To further support its obligations under the coinsurance agreement, Athene procured $ 1.1 billion in letters of credit for Jackson’s benefit and established a trust account for Jackson’s benefit, which had a book value of approximately $ 65 million at March 31, 2025.

Swiss Re Reinsurance

4 unchanged sentences

These include both direct and assumed accident and health businesses, direct and assumed life insurance business, and certain institutional annuities.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 8.

GMIB Reinsurance

3 unchanged sentences

The Company discontinued offering the GMIB in 2009.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 8.

Reinsurance Recoverables and Reinsured Market Risk Benefits

3 unchanged sentences

The Company regularly monitors the financial strength ratings of its reinsurers.

At September 30, 2024 and December 31, 2023, the Company had an allowance for credit losses (“ACL”) of $ 25 million and $ 29 million, respectively, on its reinsurance recoverables, which are reported net of ACL on the Condensed Consolidated Balance Sheets.

At March 31, 2025 and December 31, 2024, the Company had an allowance for credit losses (“ACL”) of $ 26 million and $ 27 million, respectively, on its reinsurance recoverables, which are reported net of ACL on the Condensed Consolidated Balance Sheets.

The ACL considers the credit quality of the reinsurer and is generally determined based on probability of default and loss given default assumptions, after considering any applicable collateral arrangements.

13 unchanged sentences

Components of the Company’s reinsurance recoverable excluding MRBs were as follows (in millions):

September 30, December 31,

March 31, December 31,

Life $ 5,154 $ 5,205

6 unchanged sentences

Components of the Company’s reinsurance recoverable on market risk benefits were as follows (in millions):

September 30, December 31,

March 31, December 31,

Variable annuity $ 57 $ 62

19 unchanged sentences

The following assets and liabilities were held in support of reserves associated with the Company’s funds withheld reinsurance agreements and were reported in the respective financial statement line items in the Condensed Consolidated Balance Sheets (in millions):

September 30, December 31,

March 31, December 31,

Debt securities, available-for-sale $ 8,587 $ 9,058

15 unchanged sentences

(1) Certain assets are reported at amortized cost while the fair value of those assets is reported in the embedded derivative in the funds withheld liability.

(2) Includes funds withheld embedded derivative asset (liability) of $ 1,992 million and $ 2,468 million at September 30, 2024 and December 31, 2023, respectively.

(2) Includes funds withheld embedded derivative asset (liability) of $ 2,112 million and $ 2,314 million at March 31, 2025 and December 31, 2024, respectively.

The sources of income related to funds withheld under reinsurance treaties reported in net investment income in the Condensed Consolidated Income Statements were as follows (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Debt securities (1)

$ 133 $ 162 $ 415 $ 494

Equity securities — 9

Mortgage loans (2)

47 48 141 174

Policy loans 83 82

5 unchanged sentences

Total net investment income on funds withheld reinsurance treaties $ 227 $ 270

(1) Includes $ 1 million and $ 2 million for the three and nine months ended September 30, 2024, respectively, and $ 1 million and $ 3 million for the three and nine months ended September 30, 2023, respectively, related to the change in fair value for securities carried under the fair value option.

(2) Includes $ 4 million and $ 1 million for the three and nine months ended September 30, 2024, respectively, and $( 5 ) million and $( 7 ) million for the three and nine months ended September 30, 2023, respectively, related to the change in fair value for mortgage loans carried under the fair value option.

(1) Includes $ 1 million and $ 1 million for the three months ended March 31, 2025 and 2024, respectively, related to the change in fair value for securities carried under the fair value option.

(2) Includes $ 4 million and $( 2 ) million for the three months ended March 31, 2025 and 2024, respectively, related to the change in fair value for mortgage loans carried under the fair value option.

(3) Includes management fees.

1 unchanged sentence

The gains and losses on funds withheld reinsurance treaties as a component of net gains (losses) on derivatives and investments in the Condensed Consolidated Income Statements were as follows (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Available-for-sale securities

9 unchanged sentences

Total net gains (losses) on derivatives and investments $ ( 388 ) $ ( 201 )

(1) Includes the Athene embedded derivative gain (loss) of $( 530 ) million and $( 476 ) million for the three and nine months ended September 30, 2024, respectively, and $ 451 million and $ 194 million for the three and nine months ended September 30, 2023, respectively.

(1) Includes the Athene embedded derivative gain (loss) of $( 201 ) million and $ 29 million for the three months ended March 31, 2025 and 2024, respectively.

Reserves for Future Policy Benefits and Claims Payable

43 unchanged sentences

The following table summarizes the Company’s reserves for future policy benefits and claims payable balances (in millions):

September 30, December 31,

March 31, December 31,

Reserves for future policy benefits

9 unchanged sentences

Present Value of Expected Net Premiums

Nine Months Ended September 30, Year Ended December 31,

Three Months Ended March 31, Year Ended December 31,

Payout Closed Block Closed Block Payout Closed Block Closed Block

15 unchanged sentences

Present Value of Expected Future Policy Benefits

Nine Months Ended September 30, Year Ended December 31,

Three Months Ended March 31, Year Ended December 31,

Payout Closed Block Closed Block Payout Closed Block Closed Block

2 unchanged sentences

Beginning of period cumulative effect of changes in discount rate assumptions 100 806 255 99 767 185

Beginning balance at original discount rate (including DPL of $ 42 , $ 0 and $ 626 in September 30, 2024, and $ 40 , $ 0 and $ 671 in December 31, 2023 for payout annuities, closed block life and closed block annuity, respectively)

Beginning balance at original discount rate (including DPL of $ 91 , nil and $ 588 in March 31, 2025, and $ 42 , nil and $ 626 in December 31, 2024 for payout annuities, closed block life and closed block annuity, respectively)

1,195 5,231 4,092 1,189 5,901 4,400

5 unchanged sentences

Benefits payments ( 40 ) ( 139 ) ( 113 ) ( 137 ) ( 592 ) ( 481 )

Ending balance of original discount rate (including DPL of $ 46 , $ 0 and $ 590 in September 30, 2024, and $ 42 , $ 0 and $ 626 in December 31, 2023 for payout annuities, closed block life and closed block annuity, respectively)

Ending balance of original discount rate (including DPL of $ 90 , nil and $ 574 in March 31, 2025, and $ 91 , nil and $ 588 in December 31, 2024 for payout annuities, closed block life and closed block annuity, respectively)

1,209 5,125 4,024 1,195 5,231 4,092

8 unchanged sentences

Annuities Life Annuity

September 30, 2024

March 31, 2025

Weighted average duration (years) 6.5 6.8 6.6

1 unchanged sentence

Weighted average duration (years) 6.5 6.9 6.6

The discount rate assumption was updated based on current market data.

Discount rates were lower in the third quarter of 2024 compared to the fourth quarter of 2023.

Discount rates decreased primarily due to decreases in risk-free rates.

The discount rate assumption related to the single-A corporate instrument yield was updated based on current market data.

Discount rates decreased in 2025 compared to 2024, based on the duration of the liability.

This resulted in an increase in the liability.

Refer to the roll-forward above for further details.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 9.

2 unchanged sentences

The discounted premiums are calculated using the current discount rate, while the undiscounted cash flows represent the gross cash flows before any discounting is applied:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Undiscounted Discounted Undiscounted Discounted

10 unchanged sentences

Gross Premiums Interest Expense

Nine Months Ended September 30, 2024 Year Ended December 31, 2023 Nine Months Ended September 30, 2024 Year Ended December 31, 2023

Three Months Ended March 31, 2025 Year Ended December 31, 2024 Three Months Ended March 31, 2025 Year Ended December 31, 2024

Payout Annuities $ 14 $ 53 $ 12 $ 45

3 unchanged sentences

The following table presents the weighted average interest rate for the reserves for future policy benefits at the cohort's level for the locked-in discount rate (interest accretion rate), and current discount rate, weighted by the cohort's benefit reserve amount:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Payout Annuities

10 unchanged sentences

The following table presents a roll-forward of Closed Block Life additional liabilities for annuitization, death and other insurance benefits (in millions):

Nine Months Ended September 30, 2024 Year Ended December 31, 2023

Three Months Ended March 31, 2025 Year Ended December 31, 2024

Balance, beginning of period $ 1,184 $ 1,153

10 unchanged sentences

The weighted average duration represents average cohort-level duration weighted by the benefit reserves amount:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Weighted average duration (years) 9.0 9.1

1 unchanged sentence

Assessments Interest Expense

Nine Months Ended September 30, 2024 Year Ended December 31, 2023 Nine Months Ended September 30, 2024 Year Ended December 31, 2023

Three Months Ended March 31, 2025 Year Ended December 31, 2024 Three Months Ended March 31, 2025 Year Ended December 31, 2024

Additional liability for annuitization, death and other insurance benefits $ ( 30 ) $ ( 128 ) $ 14 $ 57

The following table presents the weighted average current discount rate of Closed Block Life additional liabilities for annuitization, death and other insurance benefits, applied at the cohort level weighted by reserve benefit amount:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Weighted average current discount rate 4.99 % 4.99 %

10 unchanged sentences

For investment contracts, payments received are reported as liabilities and accounted for in a manner consistent with the accounting for interest-bearing or other financial instruments, within other contract holder funds.

The Company issues a variety of annuity products including fixed annuities, fixed index annuities, registered index linked annuities, variable annuities and payout annuities.

The Company issues a variety of annuity products including variable annuities, registered index linked annuities, fixed index annuities, fixed annuities and payout annuities.

For annuity contracts that are classified as investment contracts, the liability is the account balance as of the reporting date, reported within the other contract holder funds.

11 unchanged sentences

Federal Home Loan Bank ("FHLB") program) described below.

The Company has established a $ 27 billion aggregate Global Medium-Term Note ("MTN") program.

Jackson has established a $ 27 billion aggregate Global Medium-Term Note ("MTN") program.

Jackson National Life Global Funding was formed as a statutory business trust, solely for the purpose of issuing Medium-Term Note instruments to institutional investors, the proceeds of which are deposited with the Company and secured by the issuance of funding agreements.

The carrying values at September 30, 2024 and December 31, 2023 totaled $ 5.5 billion and $ 5.8 billion, respectively.

The carrying values at March 31, 2025 and December 31, 2024 totaled $ 6.8 billion and $ 5.9 billion, respectively.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 10.

6 unchanged sentences

Advances are in the form of funding agreements, short-term and long-term borrowings issued to FHLBI.

At September 30, 2024 and December 31, 2023, the Company held $ 127 million and $ 108 million of FHLBI capital stock, respectively, supporting $ 2.0 billion and $ 2.3 billion in funding agreements and short-term and long-term borrowings at September 30, 2024 and December 31, 2023, respectively.

At September 30, 2024 and December 31, 2023, the funding agreements and short-term and long-term borrowings were collateralized by mortgage-related securities and commercial mortgage loans with a carrying value of $ 3.0 billion and $ 3.5 billion, respectively.

At March 31, 2025 and December 31, 2024, the Company held $ 102 million and $ 127 million of FHLBI capital stock, respectively, supporting $ 2.0 billion and $ 2.7 billion in funding agreements and short-term and long-term borrowings at March 31, 2025 and December 31, 2024, respectively.

At March 31, 2025 and December 31, 2024, the funding agreements and short-term and long-term borrowings were collateralized by mortgage-related securities and commercial mortgage loans with a carrying value of $ 3.1 billion and $ 4.2 billion, respectively.

The following table presents the liabilities for other contract holder funds (in millions):

September 30, 2024 December 31, 2023

Payout Annuity $ 852 $ 860

March 31, 2025 December 31, 2024

Variable Annuity $ 7,018 $ 7,206

Fixed Annuity 9,593 9,736

Fixed Indexed Annuities 8,990 10,243

RILA 12,432 11,685

Fixed Index Annuities 8,097 8,515

Fixed Annuity 9,441 9,615

Payout Annuity 842 844

Closed Block Life 10,652 10,750

5 unchanged sentences

Fixed Closed Closed

Payout Variable Fixed Indexed Block Block

Annuity Annuity Annuity Annuities RILA Life Annuity Total

Variable Indexed Fixed Payout Block Block

Annuity RILA Annuities Annuity Annuity Life Annuity Total

Balance as of January 1, 2025 $ 7,206 $ 11,685 $ 8,515 $ 9,615 $ 844 $ 10,750 $ 1,149 $ 49,764

5 unchanged sentences

Policy charges and other ( 15 ) — ( 5 ) ( 36 ) — ( 122 ) — ( 178 )

Balance as of September 30, 2024 $ 852 $ 7,509 $ 9,593 $ 8,990 $ 10,250 $ 10,884 $ 1,163 $ 49,241

Balance as of March 31, 2025 $ 7,018 $ 12,432 $ 8,097 $ 9,441 $ 842 $ 10,652 $ 1,123 $ 49,605

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 10.

1 unchanged sentence

Fixed Closed Closed

Payout Variable Fixed Indexed Block Block

Annuity Annuity Annuity Annuities RILA Life Annuity Total

Variable Indexed Fixed Payout Block Block

Annuity RILA Annuities Annuity Annuity Life Annuity Total

Balance as of January 1, 2024 $ 8,396 $ 5,219 $ 10,243 $ 9,736 $ 860 $ 11,039 $ 1,252 $ 46,745

8 unchanged sentences

Fixed Closed Closed

Payout Variable Fixed Indexed Block Block

Annuity Annuity Annuity Annuities RILA Life Annuity

September 30, 2024

Variable Indexed Fixed Payout Block Block

Annuity RILA Annuities Annuity Annuity Life Annuity

March 31, 2025

Weighted-average crediting rate (1)

13 unchanged sentences

(2) Net amount at risk represents the standard excess benefit base for guaranteed death benefits on universal life type products.

The net amount at risk associated with market risk benefits are presented within Note 12 of the Notes to Condensed Consolidated Financial Statements.

The net amount at risk associated with market risk benefits are presented within Note 12 - Market Risk Benefits of the Notes to Condensed Consolidated Financial Statements.

(3) Cash surrender value represents the amount of the contract holder’s account balance distributable at the balance sheet date less the applicable surrender charges.

At September 30, 2024 and December 31, 2023, excluding reinsurance business, approximately 94 % and 92 % of the Company’s annuity account values correspond to crediting rates that are at the minimum guaranteed interest rates, respectively.

At September 30, 2024 and December 31, 2023, excluding reinsurance business, approximately 82 % and 64 % of the Company’s closed block life account values correspond to crediting rates that are at the minimum guaranteed interest rates, respectively.

At March 31, 2025 and December 31, 2024, excluding reinsurance business, approximately 94 % and 94 % of the Company’s annuity account values correspond to crediting rates that are at the minimum guaranteed interest rates, respectively.

At March 31, 2025 and December 31, 2024, excluding reinsurance business, approximately 82 % and 82 % of the Company’s closed block life account values correspond to crediting rates that are at the minimum guaranteed interest rates, respectively.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 10.

1 unchanged sentence

The following table presents contract holder account balances invested in fixed account funds by range of guaranteed minimum crediting rates and the related range of the difference between rates being credited to other contract holder funds and the respective guaranteed minimums (in millions):

September 30, 2024

March 31, 2025

At Guaranteed 1 Basis Point-50 51 Basis Points-150 Greater Than 150

8 unchanged sentences

Total $ 6,973 $ 44 $ 1 $ — $ 7,018

Fixed Annuities

0.00 %- 1.50 %

11 unchanged sentences

Total $ 19 $ 7 $ 96 $ 73 $ 195

Fixed Annuities

0.00 %- 1.50 %

2 unchanged sentences

Greater than 2.50 %

2,182 39 1 278 2,500

Total $ 2,233 $ 80 $ 27 $ 289 $ 2,629

26 unchanged sentences

Total $ 7,196 $ 10 $ — $ — $ 7,206

Fixed Annuities

0.00 %- 1.50 %

2 unchanged sentences

Greater than 2.50 %

721 51 1 271 1,044

Total $ 95 $ 10 $ 3 $ 4 $ 112

Fixed Indexed Annuities

Fixed Index Annuities

0.00 %- 1.50 %

4 unchanged sentences

Total $ 20 $ 8 $ 96 $ 66 $ 190

Fixed Annuities

0.00 %- 1.50 %

2 unchanged sentences

Greater than 2.50 %

2,075 41 1 265 2,382

Total $ 2,133 $ 86 $ 30 $ 266 $ 2,515

22 unchanged sentences

The separate account assets supporting the variable portion of both traditional variable annuities and variable contracts with guarantees are carried at fair value and reported as summary total separate account assets with an equivalent summary total reported for separate account liabilities.

At September 30, 2024 and December 31, 2023, the assets and liabilities associated with variable life and annuity contracts were $ 235 billion and $ 220 billion, respectively.

At March 31, 2025 and December 31, 2024, the assets and liabilities associated with variable life and annuity contracts were $ 218 billion and $ 229 billion, respectively.

Investment risks associated with market value changes are borne by the contract holders, except to the extent of minimum guarantees made by the Company.

2 unchanged sentences

Included in the separate account assets and liabilities described above is a Jackson issued group variable annuity contract designed for use in connection with and issued to the Company’s Defined Contribution Retirement Plan.

These deposits are allocated to the Jackson National Separate Account - II, which had balances of $ 216 million and $ 198 million at September 30, 2024 and December 31, 2023, respectively.

These deposits are allocated to the Jackson National Separate Account - II, which had balances of $ 200 million and $ 208 million at March 31, 2025 and December 31, 2024, respectively.

The Company receives administrative fees for managing the funds.

1 unchanged sentence

The following table presents the roll-forward of the separate account balance for variable annuities (in millions):

Nine Months Ended September 30, 2024 Year Ended December 31, 2023

Three Months Ended March 31, 2025 Year Ended December 31, 2024

Balance as of beginning of period $ 228,851 $ 219,381

Deposits 7,244 8,545

Surrenders, withdrawals and benefits (1)

( 6,917 ) ( 27,016 )

Net transfer from (to) general account ( 105 ) ( 94 )

4 unchanged sentences

$ 212,744 $ 224,157

(1) Excludes certain internal exchanges.

(2) Cash surrender value represents the amount of the contract holder’s account balances distributable at the balance sheet date less applicable surrender charges.

2 unchanged sentences

The following table presents the reconciliation of the separate account balance in the Condensed Consolidated Balance Sheets (in millions):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Variable Annuities $ 217,291 $ 228,851

2 unchanged sentences

The following table presents aggregate fair value of assets, by major investment asset category, supporting separate accounts (in millions):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Variable Annuities By Fund Type

14 unchanged sentences

However, the change in fair value related to our own non-performance risk is reported as a component of other comprehensive income in Change in non-performance risk on market risk benefits on the Condensed Consolidated Statements of Comprehensive Income (Loss).

A description of the items effecting the change in fair value by category is as follows:

A description of the items affecting the change in fair value by category is as follows:

• Changes in interest rates — movement in risk free rates (impacts both assumed future separate account returns and discounting of cash flows)

13 unchanged sentences

These guaranteed benefit features, as well as the reinsurance recoverable on the Company’s GMIB, are classified as MRBs and measured at fair value.

The Company discontinued offering the GMIB in 2009 and the GMAB in 2011.

The Company discontinued offering the GMIB in 2009.

Variable annuity guaranteed benefit features classified as MRBs, which have explicit fees, are measured using the attributed fee method.

5 unchanged sentences

As the Company may issue contracts that have projected future liabilities greater than the projected future guaranteed benefit fees at issue, the Company may also attribute mortality and expense charges when performing this calculation.

In subsequent valuations, both the present value of future projected liabilities and the present value of projected attributed fees are remeasured based on current market conditions and policyholder behavior assumptions.

In subsequent valuations, the present value of both future projected liabilities and projected attributed fees are remeasured based on current market conditions and policyholder behavior assumptions.

Fixed Index Annuities

7 unchanged sentences

The following table presents the reconciliation of the market risk benefits balance in the Condensed Consolidated Balance Sheets (in millions):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Variable Other Variable Other

6 unchanged sentences

The following table presents the roll-forward of the net MRB (assets) liabilities for variable annuities (dollars in millions):

Nine Months Ended September 30, 2024 Year Ended December 31, 2023

Three Months Ended March 31, 2025 Year Ended December 31, 2024

Net MRB balance, beginning of period $ ( 5,176 ) $ ( 2,000 )

29 unchanged sentences

The aggregate carrying value of long-term debt was as follows (in millions):

September 30, December 31,

March 31, December 31,

Long-Term Debt

6 unchanged sentences

Total long-term debt $ 2,030 $ 2,034

The following table presents the contractual maturities of the Company's long-term debt as of September 30, 2024 (in millions):

The following table presents the contractual maturities of the Company's long-term debt as of March 31, 2025 (in millions):

Calendar Year

2 unchanged sentences

Revolving Credit Facility

On February 24, 2023, the Company replaced the 2021 Revolving Credit Facility that was due to expire in February 2024, and entered into a revolving credit facility (the "2023 Revolving Credit Facility") with a syndicate of banks and Bank of America, N.A., as Administrative Agent.

On February 24, 2023, the Company replaced its prior revolving credit facility that was scheduled to expire in February 2024, with a new revolving credit facility (the "2023 Revolving Credit Facility") with a syndicate of banks and Bank of America, N.A., as Administrative Agent.

The 2023 Revolving Credit Facility provides for borrowings for working capital and other general corporate purposes under aggregate commitments of $ 1.0 billion, with a sub-limit of $ 500 million available for letters of credit.

12 unchanged sentences

The Company, through its subsidiary, Jackson, entered into an advance program with the FHLBI in which interest rates were either fixed or variable based on the FHLBI cost of funds or market rates.

Advances of nil and $ 250 million were outstanding at September 30, 2024 and December 31, 2023, respectively, and were recorded in other liabilities.

Interest expense on such advances was $ 1 million and nil for the three months ended September 30, 2024 and 2023, respectively, and $ 4 million and $ 6 million for the nine months ended September 30, 2024 and 2023, respectively.

See Note 10 - Other Contract Holder Funds of the Notes Condensed Consolidated Financial Statements for the carrying value of total collateralization of our FHLB obligations .

Advances of nil and $ 700 million were outstanding at March 31, 2025 and December 31, 2024, respectively, and were recorded in other liabilities.

Interest expense on such advances was $ 4 million and nil for the three months ended March 31, 2025 and 2024, respectively.

See Note 10 - Other Contract Holder Funds of the Notes to Condensed Consolidated Financial Statements for the carrying value securities pledged as collateral for our FHLB obligations .

The Company uses the estimated annual effective tax rate ("ETR") method in computing the interim tax provision.

3 unchanged sentences

The estimated annual ETR is revised, as necessary, at the end of successive interim reporting periods.

The Company’s effective income tax rate was 19.3 % and 3.9 % for the three and nine months ended September 30, 2024, respectively, compared with 20.5 % and 13.8 % for the same periods in 2023, respectively.

The Company’s effective income tax rate was ( 5.9 )% for the three months ended March 31, 2025, compared with 11.3 % for the same period in 2024.

The ETR differs from the statutory rate of 21% primarily due to the dividends received deduction, utilization of foreign tax credits, and valuation allowance.

The change in the ETR for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 was due to the relationship of taxable income to consolidated pre-tax income (loss).

The ETR differs for the nine months ended September 30, 2024 from the full year-ended December 31, 2023 ETR of 0.5 % due to the relationship of taxable income to consolidated pre-tax income.

On September 12, 2024, the U.S.

Treasury Department and the Internal Revenue Service released proposed regulations addressing the application of the corporate alternative minimum tax (“CAMT”) that was enacted as part of the Inflation Reduction Act of 2022 (“IRA”).

The proposed regulations are generally applicable to tax years ending after September 12, 2024 and consistent with many of the provisions provided in prior CAMT guidance.

The Company did not elect to early adopt the proposed regulations for the 2023 tax returns and relied on reasonable interpretations of previously published guidance resulting in a reduction of $ 263 million to the CAMT liability and related CAMT deferred tax asset as of September 30, 2024.

In addition, the determination of the estimated 2024 CAMT liability considered carryover impacts from the 2023 tax return and consideration of the applicability of the proposed regulations resulting in a reduction of $ 158 million to the CAMT liability and related CAMT deferred tax asset as of September 30, 2024.

For the nine months ended September 30, 2024 and 2023, the Company recorded an estimate of $ 7 million and $ 450 million, respectively, for the provision of the CAMT with an offsetting increase to the deferred tax asset for the credit carryover resulting in no impact to total tax expense.

Treasury Department is expected to issue Final Regulations after the year ended December 31, 2024, which may materially change the estimated provision of the CAMT.

The change in the ETR for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was due to the relationship of taxable income to consolidated pre-tax income (loss) and the valuation allowance.

The ETR differs for the three months ended March 31, 2025 from the full year-ended December 31, 2024 ETR of 4.6 % due to the relationship of taxable income to consolidated pre-tax income (loss) and the valuation allowance.

For the three months ended March 31, 2025 and 2024, the Company recorded an estimate of nil and $ 111 million, respectively, for the provision of the corporate alternative minimum tax ("CAMT") with an offsetting increase to the deferred tax asset for the credit carryover resulting in no impact to total tax expense.

The determination of the estimated 2025 CAMT liability considered carryover impacts from prior tax years and consideration of the applicability of the proposed regulations.

Treasury Department is expected to issue Final Regulations in 2025 or later which may materially change the estimated provision of the CAMT.

The Company is required to evaluate the recoverability of its deferred tax assets and establish a valuation allowance, if necessary, to reduce its deferred tax asset to an amount that is more likely than not to be realizable.

7 unchanged sentences

The Company has adopted an accounting policy to analyze the ability to recover the CAMT credit carryover deferred tax asset separately from the deferred tax assets generated under the regular tax system.

For the nine months ended September 30, 2024, changes in market conditions and interest rates impacted the unrealized tax gains and losses in the available for sale securities portfolio resulting in deferred tax assets related to net unrealized tax capital losses.

The deferred tax asset relates to the unrealized losses for which the carryforward period has not yet begun,

For the three months ended March 31, 2025, changes in market conditions and interest rates impacted the unrealized tax gains and losses in the available for sale securities portfolio resulting in deferred tax assets related to net unrealized tax capital losses for the life insurance group.

The deferred tax asset relates to the unrealized losses for which the carryforward period has not yet begun, and as such, when assessing its recoverability, we consider our ability and intent to hold the underlying securities to recovery, our capital loss carryback capacity, along with reversing capital deferred tax liabilities.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 15.

and as such, when assessing its recoverability, we consider our ability and intent to hold the underlying securities to recovery.

As of September 30, 2024, based on all available evidence, we concluded that a valuation allowance should be established on a portion of the deferred tax asset related to unrealized losses that are not more likely than not to be realized.

For the three and nine months ended September 30, 2024, the Company recorded a decrease of $ 295 million and a decrease of $ 218 million, respectively, to the valuation allowance associated with the unrealized tax losses in the Company's available for sale securities portfolio and a change of nil related to both realized and unrealized losses on capital assets of the Non-life Companies.

The $ 295 million decrease for the three months ended September 30, 2024, to the valuation allowance consists of $ 306 million tax benefit recorded to other comprehensive income and $ 11 million tax expense recorded in the income tax expense.

The $ 218 million decrease for the nine months ended September 30, 2024 to the valuation allowance consists of $ 206 million tax benefit recorded to other comprehensive income and $ 12 million tax benefit recorded in the income tax expense.

At September 30, 2024 and December 31, 2023, the Company has recorded a total valuation allowance for $ 471 million and $ 689 million, respectively, associated with the unrealized tax losses in the Life Companies' available for sale securities portfolio where it is not more likely than not that the full tax benefit of the losses will be realized.

As of March 31, 2025, based on all available evidence, we concluded that a valuation allowance should be established on a portion of the deferred tax asset related to unrealized losses that are not more likely than not to be realized.

For the three months ended March 31, 2025, the Company recorded a decrease of $ 98 million, to the valuation allowance associated with the unrealized tax losses in the Company's available for sale securities portfolio and a change of nil related to both realized and unrealized losses on capital assets of the Non-life Companies.

The $ 98 million decrease for the three months ended March 31, 2025, to the valuation allowance consists of $ 99 million tax benefit recorded to other comprehensive income and $ 1 million tax expense recorded in the income tax expense.

At March 31, 2025 and December 31, 2024, the Company has recorded a total valuation allowance for $ 636 million and $ 734 million, respectively, associated with the unrealized tax losses in the Life Companies' available for sale securities portfolio where it is not more likely than not that the full tax benefit of the losses will be realized.

Commitments and Contingencies

1 unchanged sentence

It is the opinion of management that the ultimate disposition of such litigation will not have a material adverse effect on the Company's financial condition.

Jackson has been named in civil litigation proceedings, which appear to be substantially similar to other class action litigation brought against many life insurers including allegations of misconduct in the sale and service of insurance products.

The Company accrues for legal contingencies once the contingency is deemed to be probable and reasonably estimable.

At September 30, 2024, the Company had unfunded commitments related to its investments in limited partnerships and limited liability companies totaling $ 966 million.

At September 30, 2024, unfunded commitments related to fixed-rate mortgage loans and other debt securities totaled $ 669 million.

At March 31, 2025, the Company had unfunded commitments related to its investments in limited partnerships and limited liability companies totaling $ 886 million.

At March 31, 2025, unfunded commitments related to fixed-rate mortgage loans and other debt securities totaled $ 923 million.

Operating Costs and Other Expenses

The following table is a summary of the Company’s operating costs and other expenses (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Asset-based commission expenses $ 284 $ 279

8 unchanged sentences

The following table represents changes in the balance of accumulated other comprehensive income ("AOCI"), net of income tax, related to unrealized investment gains (losses) (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Balance, beginning of period (1)

2 unchanged sentences

Change in current discount rate - reserve for future policy benefits (2)

( 280 ) 254 ( 132 ) 204

Change in non-performance risk on market risk benefits 327 ( 511 )

6 unchanged sentences

$ ( 2,719 ) $ ( 3,423 )

(1) Includes $( 1,336 ) million and $( 1,612 ) million related to the investments held within the funds withheld account related to the Athene Reinsurance Transaction as of September 30, 2024 and December 31, 2023, respectively.

(1) Includes $( 1,463 ) million and $( 1,597 ) million related to the investments held within the funds withheld account related to the Athene Reinsurance Transaction as of March 31, 2025 and December 31, 2024, respectively.

(2) Represents the impact of changes in the discount rate used in the remeasurement of our direct reserves for future policy benefits and claims payable, net of the remeasurement of ceded reserves for future policy benefits and claims payable.

3 unchanged sentences

Consolidated Income Statements

Three Months Ended September 30,

Three Months Ended March 31,

Net unrealized investment gain (loss):

4 unchanged sentences

Reclassifications, net of income taxes $ 7 $ ( 2 )

AOCI Components Amounts

Reclassified from AOCI Affected Line Item in the Condensed

Consolidated Income Statements

Nine Months Ended September 30,

Net unrealized investment gain (loss):

Net realized gain (loss) on investments $ 96 $ 188 Net gains (losses) on derivatives and investments

Other impaired securities ( 33 ) ( 44 ) Net gains (losses) on derivatives and investments

Net unrealized gain (loss), before income taxes 63 144

Income tax expense (benefit) 3 30

Reclassifications, net of income taxes $ 60 $ 114

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 19.

2 unchanged sentences

After underwriting discounts and expenses, we received net proceeds of approximately $ 533 million.

The Series A Preferred Stock carries i) an initial dividend rate of 8.000 % per annum to but excluding, March 30, 2028;

The Series A Preferred Stock carries a dividend rate equal to i) from issuance to but excluding March 30, 2028, 8.000 % per annum;

and ii) from, and including, March 30, 2028, during each reset period, at a rate per annum equal to the Five-year U.S.

12 unchanged sentences

Quarter Ended

03/31/2024 February 20, 2024 March 12, 2024 April 1, 2024 $ 500 $ 0.50

06/30/2024 May 2, 2024 June 6, 2024 July 1, 2024 $ 500 $ 0.50

09/30/2024 August 1, 2024 September 5, 2024 September 30, 2024 $ 500 $ 0.50

03/31/2025 February 17, 2025 March 11, 2025 March 31, 2025 $ 500 $ 0.50

Quarter Ended

03/31/2023 None

06/30/2023 May 8, 2023 June 1, 2023 June 30, 2023 $ 594.44 $ 0.59444

09/30/2023 August 7, 2023 August 31, 2023 October 2, 2023 $ 500.00 $ 0.50000

At September 30, 2024 and December 31, 2023, the Company was authorized to issue up to 1 billion shares of common stock with a par value of $ 0.01 per share.

03/31/2024 February 20, 2024 March 12, 2024 April 1, 2024 $ 500 $ 0.50

At March 31, 2025 and December 31, 2024, the Company was authorized to issue up to 1 billion shares of common stock with a par value of $ 0.01 per share.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 19.

1 unchanged sentence

On February 27, 2023 and August 1, 2024, our Board of Directors authorized increases of $ 450 million and $ 750 million, respectively, in our existing authorization to repurchase shares of our outstanding common stock as part of the Company's share repurchase program.

As of May 1, 2025, the Company had remaining authorization to purchase $ 431 million of its common shares.

The Company expects to repurchase common shares from time to time in the open market or in privately negotiated transactions.

2 unchanged sentences

It does not have an expiration date.

There can be no assurance that we will continue share repurchases or approve any further increase to our current, or approve any new, stock repurchase program, or no assurance to the amount of any repurchases that may be made pursuant to such programs.

Through September 30, 2024, we have incurred $ 3 million of excise tax in connection with share repurchases that exceeded stock issuances.

There can be no assurance that we will continue share repurchases or approve any further increase to our current, or approve any new, stock repurchase program, or any assurance to the amount of any repurchases that may be made pursuant to such programs.

Through March 31, 2025, we have incurred $ 6 million of excise tax in connection with share repurchases that exceeded stock issuances.

The excise tax incurred was recognized as part of the cost basis of the treasury stock acquired and not reported as income tax expense.

8 unchanged sentences

2025 (January 1- March 31) 1,966,909 172 87.69

2024 (April 1- June 30) 1,294,473 90 69.16

2024 (July 1- September 30) 1,352,821 113 83.39

2024 (October 1- November 1) 489,284 48 98.12

2025 (April 1- May 1) 440,022 33 74.71

Total 2025 2,406,931 $ 205 $ 85.32

4 unchanged sentences

Shares repurchased under repurchase program — ( 1,966,909 ) ( 1,966,909 )

Shares at September 30, 2024 94,484,409 ( 20,133,348 ) 74,351,061

Shares at March 31, 2025 94,488,315 ( 22,609,773 ) 71,878,542

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

7 unchanged sentences

03/31/2025 February 17, 2025 March 11, 2025 March 20, 2025 $ 0.80

06/30/2024 May 2, 2024 June 6, 2024 June 20, 2024 $ 0.70

09/30/2024 August 1, 2024 September 5, 2024 September 19, 2024 $ 0.70

Quarter Ended

03/31/2024 February 20, 2024 March 12, 2024 March 21, 2024 $ 0.70

06/30/2023 May 8, 2023 June 1, 2023 June 15, 2023 $ 0.62

09/30/2023 August 7, 2023 August 31, 2023 September 14, 2023 $ 0.62

Earnings Per Share

1 unchanged sentence

Diluted earnings per share is calculated by dividing the net income (loss) attributable to Jackson Financial common shareholders, by the weighted-average number of shares of common stock outstanding for the period, plus shares representing the dilutive effect of share-based awards.

Beginning in 2021, the Company granted its first share-based awards subject to vesting provisions of the 2021 Omnibus Incentive Plan, which have a dilutive effect.

See Note 18 - Share-Based Compensation of the Notes to Consolidated Financial Statements in the Company’s 2023 Annual Report for further description of share-based awards.

The Company grants share-based awards subject to vesting provisions of the 2021 Omnibus Incentive Plan, which can have a dilutive effect.

See Note 18 - Share-Based Compensation of the Notes to Consolidated Financial Statements in the Company’s 2024 Annual Report for further description of our share-based awards.

The following table sets forth the calculation of earnings per common share:

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

(in millions, except share and per share data)

12 unchanged sentences

(1) If we reported a net loss attributable to Jackson Financial Inc., all common stock equivalents are anti-dilutive and are therefore excluded from the calculation of diluted shares and diluted per share amounts.

The shares excluded from the diluted EPS calculation were 751,646 shares for the three months ended September 30, 2024.

Item 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 21.

Subsequent Events

The shares excluded from the diluted EPS calculation were 247,765 shares for the three months ended March 31, 2025.

Subsequent Events

1 unchanged sentence

Dividends Declared to Shareholders

On November 1, 2024, our Board of Directors approved a cash dividend on JFI's common stock of $ 0.70 per share for the fourth quarter 2024, payable on December 19, 2024, to common shareholders of record on December 5, 2024.

On May 2, 2025, our Board of Directors approved a cash dividend on JFI's common stock of $ 0.80 per share for the second quarter 2025, payable on June 26, 2025, to common shareholders of record on June 12, 2025.

The Company also announced the declaration of a cash dividend of $ 0.50 per depositary share, each representing a 1/1,000th interest in a share of Fixed-Rate Reset Noncumulative Perpetual Preferred Stock, Series A.

The dividend will be payable on December 30, 2024, to preferred shareholders of record at the close of business on December 5, 2024.

The dividend will be payable on June 30, 2025, to depositary shareholders of record at the close of business on June 12, 2025.

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.

What changed 10-Q

Item 1. Financial Statements