Investments (Tables)

9 Months Ended

Sep. 30, 2025

Investments, Debt and Equity Securities [Abstract]

The Company’s consolidated investments are summarized as follows (in millions):


	September 30, 2025
	Amortized Cost		Allowance for Expected Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
AFS securities
Asset-backed securities	$	18,340	$	(21)	$	198	$	(258)	$	18,259
Commercial mortgage-backed securities	5,480		(55)		66		(149)		5,342
Corporates	24,357		(19)		326		(2,244)		22,420
Hybrids	596		—		5		(19)		582
Municipals	1,575		—		6		(207)		1,374
Residential mortgage-backed securities	2,968		(1)		68		(71)		2,964
U.S. Government	421		—		2		(1)		422
Foreign Governments	268		—		4		(34)		238
Total AFS securities	$	54,005	$	(96)	$	675	$	(2,983)	$	51,601


	December 31, 2024
	Amortized Cost		Allowance for Expected Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
AFS securities
Asset-backed securities	$	15,777	$	(13)	$	202	$	(317)	$	15,649
Commercial mortgage-backed securities	5,327		(49)		53		(200)		5,131
Corporates	23,177		—		103		(2,802)		20,478
Hybrids	604		—		6		(29)		581
Municipals	1,592		—		3		(249)		1,346
Residential mortgage-backed securities	2,861		—		32		(105)		2,788
U.S. Government	160		—		1		(3)		158
Foreign Governments	231		—		—		(45)		186
Total AFS securities	$	49,729	$	(62)	$	400	$	(3,750)	$	46,317

Investments Classified by Contractual Maturity Date

The amortized cost and fair value of fixed maturity securities by contractual maturities, as applicable, are shown below (in millions). Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations.


	September 30, 2025
	Amortized Cost		Fair Value
Corporates, Non-structured Hybrids, Municipal, Foreign and U.S. Government Securities:
Due in one year or less	$	542	$	537
Due after one year through five years	4,110		4,140
Due after five years through ten years	5,153		5,161
Due after ten years	17,412		15,198
Subtotal	27,217		25,036
Other securities, which provide for periodic payments:
Asset-backed securities	18,340		18,259
Commercial mortgage-backed securities	5,480		5,342

Residential mortgage-backed securities	2,968		2,964
Subtotal	26,788		26,565
Total fixed maturity AFS securities	$	54,005	$	51,601

Activity in Allowance for Credit Loses of Available-for-sale Securities Aggregated by Investment Category

The activity in the allowance for expected credit losses of AFS securities aggregated by investment category was as follows (in millions):


	Three months ended September 30, 2025
			Additions				Reductions
	Balance at Beginning of Period		For credit losses on securities for which losses were not previously recorded		(Additions) reductions in allowance recorded on previously impaired securities			For securities sold during the period		For securities intended/required to be sold prior to recovery of amortized cost basis		Write offs charged against the allowance		Recoveries of amounts previously written off		Balance at End of Period
AFS securities
Asset-backed securities	$	(24)	$	—	$	3		$	—	$	—	$	—	$	—	$	(21)
Commercial mortgage-backed securities	(53)		—		(2)			—		—		—		—		(55)
Corporates	(20)		—		1			—		—		—		—		(19)


Residential mortgage-backed securities	—		—		(1)			—		—		—		—		(1)


Total AFS securities	$	(97)	$	—	$	1		$	—	$	—	$	—	$	—	$	(96)


	Three months ended September 30, 2024
			Additions				Reductions
	Balance at Beginning of Period		For credit losses on securities for which losses were not previously recorded		(Additions) reductions in allowance recorded on previously impaired securities			For securities sold during the period		For securities intended/required to be sold prior to recovery of amortized cost basis		Write offs charged against the allowance		Recoveries of amounts previously written off		Balance at End of Period
AFS securities
Asset-backed securities	$	(11)	$	(1)	$	—		$	—	$	—	$	—	—		$	(12)
Commercial mortgage-backed securities	(46)		(3)		—			—		—		—		—		(49)



Residential mortgage-backed securities	(1)		1		(1)			—		—		—		—		(1)


Total AFS securities	$	(58)	$	(3)	$	(1)		$	—	$	—	$	—	$	—	$	(62)


	Nine months ended September 30, 2025
			Additions				Reductions
	Balance at Beginning of Period		For credit losses on securities for which losses were not previously recorded		(Additions) reductions in allowance recorded on previously impaired securities			For securities sold during the period		For securities intended/required to be sold prior to recovery of amortized cost basis		Write offs charged against the allowance		Recoveries of amounts previously written off		Balance at End of Period
AFS securities
Asset-backed securities	$	(13)	$	(4)	$	(5)		$	1	$	—	$	—	$	—	$	(21)
Commercial mortgage-backed securities	(49)		(1)		(5)			—		—		—		—		(55)
Corporates	—		(14)		(5)			—		—		—		—		(19)


Residential mortgage-backed securities	—		—		(1)			—		—		—		—		(1)


Total AFS securities	$	(62)	$	(19)	$	(16)		$	1	$	—	$	—	$	—	$	(96)


	Nine months ended September 30, 2024
			Additions				Reductions
	Balance at Beginning of Period		For credit losses on securities for which losses were not previously recorded		(Additions) reductions in allowance recorded on previously impaired securities			For securities sold during the period		For securities intended/required to be sold prior to recovery of amortized cost basis		Write offs charged against the allowance		Recoveries of amounts previously written off		Balance at End of Period
AFS securities
Asset-backed securities	$	(11)	$	(2)	$	1		$	—	$	—	$	—	—		$	(12)
Commercial mortgage-backed securities	(22)		(8)		(19)			—		—		—		—		(49)



Residential mortgage-backed securities	(2)		—		1			—		—		—		—		(1)


Total AFS securities	$	(35)	$	(10)	$	(17)		$	—	$	—	$	—	$	—	$	(62)

Fair Value and Gross Unrealized Losses of Available-for-sale Securities

The fair value and gross unrealized losses of AFS securities, excluding securities in an unrealized loss position with an allowance for expected credit loss, aggregated by investment category and duration of fair value below amortized cost as of September 30, 2025 and December 31, 2024 were as follows (dollars in millions):


	September 30, 2025
	Less than 12 months				12 months or longer				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
AFS securities
Asset-backed securities	$	1,738	$	(27)	$	2,238	$	(208)	$	3,976	$	(235)
Commercial mortgage-backed securities	373		(9)		1,181		(126)		1,554		(135)
Corporates	2,431		(40)		9,460		(2,204)		11,891		(2,244)
Hybrids	71		(2)		339		(17)		410		(19)
Municipals	159		(4)		1,016		(203)		1,175		(207)
Residential mortgage-backed securities	169		(1)		390		(64)		559		(65)
U.S. Government	185		(1)		10		—		195		(1)
Foreign Government	4		—		125		(34)		129		(34)
Total AFS securities	$	5,130	$	(84)	$	14,759	$	(2,856)	$	19,889	$	(2,940)
Total number of AFS securities in an unrealized loss position less than twelve months											1,699
Total number of AFS securities in an unrealized loss position twelve months or longer											2,053
Total number of AFS securities in an unrealized loss position											3,752


	December 31, 2024
	Less than 12 months				12 months or longer				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
AFS securities
Asset-backed securities	$	1,164	$	(30)	$	2,637	$	(276)	$	3,801	$	(306)
Commercial mortgage-backed securities	699		(10)		1,508		(175)		2,207		(185)
Corporates	6,524		(202)		9,234		(2,600)		15,758		(2,802)
Hybrids	105		(4)		380		(25)		485		(29)
Municipals	261		(12)		966		(237)		1,227		(249)
Residential mortgage-backed securities	898		(16)		459		(89)		1,357		(105)
U.S. Government	93		(2)		10		(1)		103		(3)
Foreign Government	51		(1)		128		(44)		179		(45)
Total AFS securities	$	9,795	$	(277)	$	15,322	$	(3,447)	$	25,117	$	(3,724)
Total number of AFS securities in an unrealized loss position less than twelve months											1,838
Total number of AFS securities in an unrealized loss position twelve months or longer											2,113
Total number of AFS securities in an unrealized loss position											3,951

Schedule of Distribution of CMLs, Gross Valuation by Property Type and Geographic Region

The distribution of CMLs, gross of valuation allowances, by property type and geographic region is reflected in the following tables (dollars in millions):


	September 30, 2025				December 31, 2024
	Gross Carrying Value		% of Total		Gross Carrying Value		% of Total
Property Type:


Hotel	$	17	1	%	$	17	1	%
Industrial	705		21		657		24
Mixed Use	20		1		11		—
Multifamily	1,156		35		1,006		37
Office	349		11		349		13
Retail	367		11		98		4
Student Housing	83		3		83		3
Other	606		17		501		18
Total CMLs, gross of valuation allowance	3,303		100	%	2,722		100	%
Allowance for expected credit loss	(19)				(17)
Total CMLs, net of valuation allowance	$	3,284			$	2,705

U.S. Region:
East North Central	$	126	4	%	$	98	4	%
East South Central	87		3		75		3
Middle Atlantic	358		11		354		13
Mountain	421		13		409		15
New England	187		6		164		6
Pacific	732		22		706		26
South Atlantic	1,099		32		683		25
West North Central	67		2		62		2
West South Central	226		7		171		6

Total CMLs, gross of valuation allowance	3,303		100	%	2,722		100	%
Allowance for expected credit loss	(19)				(17)
Total CMLs, net of valuation allowance	$	3,284			$	2,705

Loans Segregated by Risk Rating Exposure

CMLs segregated by aging of the loans (by year of origination) as of September 30, 2025 and December 31, 2024, were as follows, gross of valuation allowances (in millions):


	September 30, 2025

	Amortized Cost by Origination Year
	2025		2024		2023		2022		2021		Prior		Total
Current (less than 30 days past due)	$	588	$	292	$	238	$	291	$	1,253	$	631	$	3,293
30-89 days past due	—		—		—		—		—		—		—
90 days or more past due	—		—		—		—		—		10		10
Total CMLs	$	588	$	292	$	238	$	291	$	1,253	$	641	$	3,303


	December 31, 2024

	Amortized Cost by Origination Year
	2024		2023		2022		2021		2020		Prior		Total
Current (less than 30 days past due)	$	273	$	227	$	290	$	1,253	$	469	$	201	$	2,713
30-89 days past due	—		—		—		—		—		—		—
90 days or more past due	—		—		—		—		—		9		9
Total CMLs	$	273	$	227	$	290	$	1,253	$	469	$	210	$	2,722

RMLs segregated by aging of the loans (by year of origination) as of September 30, 2025 and December 31, 2024, were as follows, gross of valuation allowances (in millions):


	September 30, 2025
	Amortized Cost by Origination Year
	2025		2024		2023		2022		2021		Prior		Total
Current (less than 30 days past due)	$	931	$	752	$	353	$	846	$	749	$	425	$	4,056
30-89 days past due	6		6		3		10		3		9		37
90 days or more past due	—		5		4		11		21		31		72
Total RMLs	$	937	$	763	$	360	$	867	$	773	$	465	$	4,165


	December 31, 2024
	Amortized Cost by Origination Year
	2024		2023		2022		2021		2020		Prior		Total
Current (less than 30 days past due)	$	610	$	368	$	911	$	805	$	162	$	312	$	3,168
30-89 days past due	1		6		4		6		1		3		21
90 days or more past due	3		2		13		29		13		25		85
Total RMLs	$	614	$	376	$	928	$	840	$	176	$	340	$	3,274

Schedule of Investment in Mortgage Loans by Loan to Value and Debt Service Coverage Ratios

The following tables present the recorded investment in CMLs by LTV and DSC ratio categories and estimated fair value by the indicated loan-to-value ratios, gross of valuation allowances at September 30, 2025 and December 31, 2024 (dollars in millions):


	Debt-Service Coverage Ratios						Total Amount	% of Total		Estimated Fair Value		% of Total
	>1.25		1.00 - 1.25		<1.00
September 30, 2025
LTV Ratios:
Less than 50.00%	$	658	$	16	$	—		$	674	20	%	$	657	21	%
50.00% to 59.99%	912		29		12			953		29		881		29
60.00% to 74.99%	1,467		192		—			1,659		50		1,513		49
75.00% to 84.99%	4		4		9			17		1		17		1

Total CMLs	$	3,041	$	241	$	21		$	3,303	100	%	$	3,068	100	%

December 31, 2024
LTV Ratios:
Less than 50.00%	$	490	$	34	$	—		$	524	19	%	$	501	21	%
50.00% to 59.99%	803		112		12			927		34		826		34
60.00% to 74.99%	1,238		16		—			1,254		46		1,060		44
75.00% to 84.99%	4		4		9			17		1		17		1
Total CMLs	$	2,535	$	166	$	21		$	2,722	100	%	$	2,404	100	%


	September 30, 2025

	Amortized Cost by Origination Year
	2025		2024		2023		2022		2021		Prior		Total
LTV Ratios:
Less than 50.00%	$	146	$	49	$	110	$	20	$	75	$	274	$	674
50.00% to 59.99%	157		29		53		149		321		244		953
60.00% to 74.99%	285		210		71		113		857		123		1,659
75.00% to 84.99%	—		4		4		9		—		—		17

Total CMLs	$	588	$	292	$	238	$	291	$	1,253	$	641	$	3,303

DSC Ratios
Greater than 1.25x	$	527	$	141	$	226	$	279	$	1,241	$	627	$	3,041
1.00x - 1.25x	61		151		12		3		—		14		241
Less than 1.00x	—		—		—		9		12		—		21
Total CMLs	$	588	$	292	$	238	$	291	$	1,253	$	641	$	3,303


	December 31, 2024

	Amortized Cost by Origination Year
	2024		2023		2022		2021		2020		Prior		Total
LTV Ratios:
Less than 50.00%	$	66	$	99	$	19	$	74	$	189	$	77	$	524
50.00% to 59.99%	112		53		149		321		159		133		927
60.00% to 74.99%	91		71		113		858		121		—		1,254
75.00% to 84.99%	4		4		9		—		—		—		17
Total CMLs	$	273	$	227	$	290	$	1,253	$	469	$	210	$	2,722

DSC Ratios
Greater than 1.25x	$	140	$	215	$	278	$	1,241	$	469	$	192	$	2,535
1.00x - 1.25x	133		12		3		—		—		18		166
Less than 1.00x	—		—		9		12		—		—		21
Total CMLs	$	273	$	227	$	290	$	1,253	$	469	$	210	$	2,722

Distribution of Residential Mortgage Loans by State

The distribution of RMLs by state with highest-to-lowest concentration are reflected in the following tables, gross of valuation allowances (dollars in millions):


	September 30, 2025
	Amortized Cost		% of Total
U.S. States:
Florida	$	199	5	%
New York	186		5
California	184		5
All other states (a)	3,596		85
Total RMLs, gross of valuation allowance	4,165		100	%
Allowance for expected credit loss	(58)
Total RMLs, net of valuation allowance	$	4,107

(a)The individual concentration of each state is less than 5% as of September 30, 2025.


	December 31, 2024
	Amortized Cost		% of Total
U.S. States:
Florida	$	164	5	%






All other states (a)	3,110		95
Total RMLs, gross of valuation allowance	3,274		100	%
Allowance for expected credit loss	(53)
Total RMLs, net of valuation allowance	$	3,221

(a)The individual concentration of each state is less than 5% as of December 31, 2024.

Schedule of Loans with Credit Quality Indicators, Performing or Nonperforming

The credit quality of RMLs as of September 30, 2025 and December 31, 2024, was as follows (dollars in millions):


	September 30, 2025				December 31, 2024
	Amortized Cost		% of Total		Amortized Cost		% of Total
Performing	$	4,093	98	%	$	3,188	97	%
Non-performing	72		2		86		3
Total RMLs, gross of valuation allowance	4,165		100	%	3,274		100	%
Allowance for expected loan loss	(58)				(53)
Total RMLs, net of valuation allowance	$	4,107			$	3,221

Nonaccrual Loans by Amortized Cost

Non-accrual loans by amortized cost as of September 30, 2025 and December 31, 2024, were as follows (in millions):


	September 30, 2025		December 31, 2024
Residential mortgage:	$	72	$	85
Commercial mortgage:	10		9
Total non-accrual mortgages	$	82	$	94

Allowance for Expected Credit Losses on Loans

The allowances for our mortgage loan portfolio are summarized as follows (in millions):


	Three months ended September 30, 2025						Nine months ended September 30, 2025

	Residential Mortgage		Commercial Mortgage		Total		Residential Mortgage		Commercial Mortgage		Total
Beginning Balance	$	(58)	$	(17)	$	(75)	$	(53)	$	(17)	$	(70)
Provision expense for loan losses	—		(2)		(2)		(5)		(2)		(7)




Ending Balance	$	(58)	$	(19)	$	(77)	$	(58)	$	(19)	$	(77)


	Three months ended September 30, 2024						Nine months ended September 30, 2024

	Residential Mortgage		Commercial Mortgage		Total		Residential Mortgage		Commercial Mortgage		Total
Beginning Balance	$	(50)	$	(14)	$	(64)	$	(54)	$	(12)	$	(66)
Provision (expense) benefit for loan losses	(1)		(4)		(5)		3		(6)		(3)




Ending Balance	$	(51)	$	(18)	$	(69)	$	(51)	$	(18)	$	(69)

Schedule of Sources of Net Investment Income Reported

The major sources of Interest and investment income reported on the unaudited Condensed Consolidated Statements of Operations were as follows (in millions):


	Three months ended September 30,				Nine months ended September 30,
	2025		2024		2025		2024
Fixed maturity securities, available-for-sale	$	586	$	562	$	1,686	$	1,620
Equity securities	5		5		14		16
Preferred securities	3		5		10		18
Mortgage loans	97		69		266		200
Invested cash and short-term investments	18		53		83		115
Limited partnerships	91		83		205		234

Other investments	15		9		27		25
Gross investment income	815		786		2,291		2,228
Investment expense	(67)		(74)		(195)		(216)
Interest and investment income	$	748	$	712	$	2,096	$	2,012

Recognized Gains (Losses) Net

Details underlying Recognized gains and (losses), net reported on the unaudited Condensed Consolidated Statements of Operations were as follows (in millions):


	Three months ended September 30,				Nine months ended September 30,
	2025		2024		2025		2024
Net realized (losses) gains on fixed maturity available-for-sale securities	$	(13)	$	(2)	$	(14)	$	2
Net realized/unrealized gains (losses) on equity securities (a)	1		3		(28)		11
Net realized/unrealized gains on preferred securities (b)	5		9		2		17
Net realized/unrealized (losses) gains on other invested assets	(3)		4		3		69
Change in allowance for expected credit losses	1		(10)		(41)		(33)
Derivatives and embedded derivatives:
Realized (losses) gains on certain derivative instruments	(49)		30		(126)		65
Unrealized gains on certain derivative instruments	326		347		358		450
Change in fair value of reinsurance related embedded derivatives (c)	(60)		(178)		(162)		(186)
Change in fair value of other derivatives and embedded derivatives	3		3		7		6
Net realized/unrealized gains on derivatives and embedded derivatives	220		202		77		335
Recognized gains and (losses), net	$	211	$	206	$	(1)	$	401

(a)Includes net valuation gains of $0 million and $4 million for the three months ended September 30, 2025 and September 30, 2024, respectively, and net valuation (losses) gains of $(19) million and $12 million for the nine months ended September 30, 2025 and September 30, 2024, respectively.

(b)Includes net valuation gains of $5 million and $9 million for the three months ended September 30, 2025 and September 30, 2024, respectively, and net valuation gains of $3 million and $17 million for the nine months ended September 30, 2025 and September 30, 2024.

(c)Change in fair value of reinsurance related embedded derivatives is due to activity related to the reinsurance treaties.

Proceeds from Sale of Fixed Maturity Available-for-sale Securities

The proceeds from the sale of fixed-maturity securities and the gross gains and losses associated with those transactions were as follows (in millions):


	Three months ended September 30,				Nine months ended September 30,
	2025		2024		2025		2024
Proceeds	$	900	$	1,471	$	3,567	$	2,626
Gross gains	7		18		23		36
Gross losses	(3)		(20)		(23)		(52)

Schedule of Carrying Value and Maximum Loss Exposure, Unconsolidated VIEs

The following table summarizes the carrying value and the maximum loss exposure of our unconsolidated VIEs as of September 30, 2025 and December 31, 2024 (in millions):


	September 30, 2025				December 31, 2024
	Carrying Value		Maximum Loss Exposure		Carrying Value		Maximum Loss Exposure
Investment in unconsolidated affiliates	$	4,731	$	5,859	$	3,565	$	4,703
Fixed maturity securities	26,250		27,136		23,242		24,242
Total unconsolidated VIE investments	$	30,981	$	32,995	$	26,807	$	28,945

Schedules of Investment Concentrations

Our underlying investment concentrations that exceed 10% of shareholders equity are as follows (in millions):


	September 30, 2025		December 31, 2024
Blackstone Wave Asset Holdco (a)	$	674	$	710
Prime Notes LLC (b)	672		—
Blackstone Cooper Asset Holdco (a) (c)	—		472

(a)Represents a special purpose vehicle that holds investments in numerous limited partnership investments whose underlying investments are further diversified by holding interest in multiple individual investments and industries.

(b)Represents institutional grade asset-backed securities.

(c)Investment did not exceed 10% of shareholder’s equity as of September 30, 2025.

F&G Annuities & Life, Inc. 10-Q