What Reinsurance Group of America (RGA) Said on Its Q3 Earnings Call

Key Points

• RGA reported strong Q3 results: Pre-tax adjusted operating income was $736 million, or $8.49 per share after tax, and trailing-12-month adjusted operating ROE was 19.1%. Management said it remains confident in meeting or exceeding its intermediate-term targets.
• Investment gains boosted the quarter, but are not expected to recur at the same level: Variable investment income earned an annualized return of about 15% in Q3; RGA expects full-year returns of 10%–12%, above its 7% planned return for 2026. Economic claims were $67 million better than expected.
• Business activity and capital deployment remained robust: Premiums excluding pension risk transfer grew 8.9% year to date, and the company completed pension risk transfer and longevity transactions across several markets. RGA returned $139 million to shareholders in Q3 and ended the quarter with about $1.8 billion in excess capital.

Reinsurance Group of America NYSE: RGA reported third-quarter 2026 pre-tax adjusted operating income of $736 million, supported by strong investment returns and performance across its regions. Adjusted operating income was $8.49 per share after tax.

The reinsurer’s adjusted operating return on equity was 19.1% over the trailing 12 months, excluding accumulated other comprehensive income and notable items, Chief Financial Officer Laura Cockrill said. Management said it remains confident it will meet or exceed its intermediate-term financial targets.

President and CEO Tony Cheng said the company’s pipeline for both in-force transactions and ongoing flow business remains attractive. U.S. pension risk transfer and U.K. longevity markets gained momentum after a slow start to the year, he said, with the company completing several transactions and seeing opportunities into 2027.

Investment Returns and Claims

Cockrill said investment results were a significant contributor to the quarter. Variable investment income generated an annualized return of approximately 15%, compared with about 12% for the year to date. The quarterly result was driven by real estate joint venture gains and alternative equity returns.

The company does not expect to repeat the third-quarter return in the fourth quarter, but expects full-year returns to fall within its longer-term range of 10% to 12%, Cockrill said. That would be above RGA’s 7% planned return for 2026.

The new money rate rose to 6.31% from the prior quarter, while the core portfolio yield, excluding variable investment income, was 4.96%. Cockrill said the gap between the two should continue to support investment income. Third-quarter impairments and changes in allowances totaled $71 million.

Claims were $67 million better than expected on an economic basis, although their financial impact was negative $9 million, Cockrill said. Since 2023, economic claims have been favorable by more than $400 million, with the portion not yet reported in results expected to flow into earnings over the life of the business.

RGA’s annual review of actuarial assumptions had no net impact on consolidated pre-tax adjusted operating income and is expected to have a de minimis effect on the future earnings run rate, Cockrill said.

Business Growth and Capital Deployment

Year-to-date premiums excluding pension risk transfer business grew 8.9%, or 8.2% on a constant-currency basis. Cockrill said RGA is emphasizing that measure because a growing number of Financial Solutions deals involve biometric underwriting, making traditional premium growth alone a less useful indicator of biometric growth.

In the Americas, RGA completed four pension risk transfer transactions with more than $800 million in combined premium. Cheng said the company also completed U.K. and continental European longevity transactions and closed several flow deals in Asia, notably in Hong Kong and Japan.

RGA deployed $119 million into in-force transactions during the quarter and fully deployed the capital of Ruby Re, its third-party capital vehicle. Cockrill said third-party capital remains a priority but did not provide an update on a potential future vehicle.

The company returned $139 million to shareholders through $75 million in share repurchases and $64 million in dividends. Buybacks totaled $175 million for the year to date. RGA ended the quarter with approximately $1.8 billion in excess capital, down from the prior quarter primarily because it used $400 million to retire a senior security.

In-force management actions contributed $57 million during the quarter, all from uncapped cohorts, Cockrill said. Actions over the past several quarters have increased the ongoing earnings run rate by approximately $10 million to $15 million, although she said the timing and size of future actions are difficult to predict.

Reporting Changes and Risk Leadership

Beginning in the fourth quarter, RGA plans to report results in four segments: Americas, EMEA, Asia Pacific and Corporate. It will no longer separately report traditional and Financial Solutions business. Cockrill said the company plans to provide recast historical financial results ahead of its fourth-quarter earnings call.

Cheng also said Global Chief Risk Officer Jonathan Porter plans to retire in early 2027. Meyrick Douglas will join RGA in the fourth quarter and become chief risk officer on Jan. 1, 2027, following a transition period with Porter.

About Reinsurance Group of America (NYSE:RGA)

Reinsurance Group of America, Incorporated NYSE: RGA is a global provider of life and health reinsurance. The company works with insurance carriers to help them manage mortality, longevity, morbidity and other insurance risks, while supporting the development and distribution of life and health insurance products.

RGA's offerings include traditional life reinsurance, including term, whole life and universal life coverage, as well as health reinsurance and financial solutions. Its financial solutions business provides capital management, asset-intensive reinsurance, longevity and other risk-management arrangements designed to help insurers manage their balance sheets and meet changing customer and regulatory needs.

Founded in 1973 as part of General American Life Insurance Company, RGA became an independent public company in 1993.

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