Fidelity National Financial (FNF) risk factors, FY2025 10-K

Other

1. 01If economic and credit market conditions deteriorate, it could have a material adverse impact on our investment portfolio and could also cause our stock price to fluctuate significantly
2. 02The value and performance of certain of our assets are dependent upon the performance of collateral underlying these investments. It is possible the collateral will not meet performance expectations leading to adverse changes in the cash flows on our holdings of these types of securities
3. 03Equity market volatility could negatively impact our business
4. 04Conditions in the economy generally could adversely affect our business, results of operations and financial condition
5. 05Our investments are subject to market and credit risks. These risks could be heightened during periods of extreme volatility or disruption in financial and credit markets
6. 06We also maintain holdings in floating rate and less rate-sensitive investments, including senior tranches of CLOs and directly originated senior secured loans. If realized collateral loss and recoveries differ materially from our assumptions, returns on these assets could be lower than our expectationNew
7. 07If adverse changes in the levels of real estate activity occur, our revenues may decline28% rewritten
8. 08Interest rate fluctuations could adversely affect our business, financial condition, liquidity, results of operations and cash flows97% rewritten
9. 09earnings associated with its floating rate investments. All of these assets are subject to an element of market risk from changes in interest ratesNew
10. 10F&G is exposed to liquidity risk, which is the risk that F&G is unable to meet near-term obligations as they come dueNew
11. 11agreements through the FHLB or other credit facilities, may be unavailable or inadequate to satisfy the liquidity demands described belowNew
12. 12We have recorded goodwill as a result of prior acquisitions, and an economic downturn could cause these balances to become impaired, requiring write-downs that would reduce our operating income21% rewritten
13. 13Our substantial indebtedness could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry and prevent us from meeting our obligations under our indebtedness
14. 14We may face losses if our actual experience differs significantly from our reserve assumptions
15. 15See Item 7 of Part II of this Annual Report, under. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates
16. 16We are a holding company and depend on distributions from our subsidiaries for cash
17. 17Our business could be interrupted or compromised if we experience difficulties arising from outsourcing relationships
18. 18If we are unable to attract and retain national marketing organizations and independent agents, sales of our products may be reduced
19. 19Failure of our enterprise-wide risk management processes could result in unexpected monetary losses, damage to our reputation, additional costs or impairment of our ability to conduct business effectively
20. 20If we experience changes in the rate or severity of title insurance claims, it may be necessary for us to record additional charges to our claim loss reserve. This may result in lower net earnings and the potential for earnings volatility
21. 21Changes in the Company’s dealings with large mortgage lenders, servicers or government-sponsored enterprises could adversely affect our title insurance and mortgage servicing subsidiaries
22. 22If the rating agencies downgrade our insurance companies, our results of operations and financial condition may suffer
23. 23If our claim loss prevention procedures fail, we could incur significant claim losses
24. 24Our use of independent agents for a significant amount of our title insurance policies could adversely impact the frequency and severity of title claims
25. 25Our business is subject to risk due to our owned distribution strategy and investments in distribution consolidation72% rewritten
26. 26The F&G Distribution could adversely affect our results of operations or financial condition34% rewritten
27. 27Certain F&G directors may have actual or potential conflicts of interest because of their FNF equity ownership or their current or former FNF positions
28. 28Because we are dependent upon California and Texas for approximately 12.2% and 14.1% of our title insurance premiums, respectively, our Title segment may be adversely affected by regulatory conditions in California and/or Texas39% rewritten
29. 29Concentration in certain states for the distribution of our life insurance and annuity products in our F&G segment may subject us to losses attributable to economic downturns or catastrophes in those states40% rewritten
30. 30Risk Factors Relating to Government Regulation of the Insurance Industry
31. 31State regulation of the rates we charge for title insurance could adversely affect our results of operations
32. 32Our F&G segment is highly regulated and subject to numerous legal restrictions and regulations86% rewritten
33. 33F&G's business is subject to government regulation in each of the jurisdictions in which we conduct business and regulators have broad administrative and discretionary authority over our business and business practicesNew
34. 34F&G's business in the United States is regulated by the National Association of Insurance Commissioners (“NAIC”), which continues to consider reforms including relating to cybersecurity regulations, best interest standards, risk-based capital (“RBC”) and life insurance reservesNew
35. 35to work to reform state regulation in various areas, including comprehensive reforms relating to cybersecurity regulations, best interest standards, RBC and life insurance reservesNew
36. 36Current and emerging developments relating to market conduct standards for the financial industry emerging from the United States Department of Labor’s (“DOL”) implementation of the “fiduciary rule” may over time materially affect our businessNew
37. 37challenged in Federation of Americans were also stayed, noting that the Northern District fully agreed with the Eastern District’s analysis and decision to stay the effective date of the New Fiduciary RuleNew
38. 38Changes to regulations under ERISA could adversely affect the Company by increasing the Company’s regulatory and compliance burdenNew
39. 39Our regulation in Bermuda and the Cayman Islands may limit or curtail our activities, and changes to existing regulations may affect our ability to continue to offer our existing products and services, or new products and servicesNew
40. 40The SECURE 2.0 Act of 2022 may impact our business and the markets in which we compete
41. 41Regulatory investigations of the insurance industry may lead to fines, settlements, new regulation or legal uncertainty, which could negatively affect our results of operations
42. 42Changing rules, public disclosure regulations and stakeholder expectations on environmental, social and corporate governance (“ESG”) related matters create a variety of risks for our business
43. 43We are subject to the credit risk of our counterparties, including companies with whom we have reinsurance agreements or we have purchased equity options
44. 44If financial institutions at which we hold escrow funds fail, it could have a material adverse impact on our company
45. 45Our business could be materially and adversely affected by the occurrence of a catastrophe, including natural disasters or those caused by humans
46. 46Failure of our information security systems or unauthorized access to such systems could result in a loss or disclosure of confidential information, damage to our reputation, monetary losses, additional costs and impairment of our ability to conduct business effectively
47. 47The new and emerging types of Artificial Intelligence and their uses are very early stage in the industry and may be subject to many uncertain future developments and regulations86% rewritten
48. 48modifications to, laws and regulations pertaining to the use of Artificial Intelligence by insurance companies or the broader financial services sector, which may prove to be onerous for companies to implement in a timely mannerNew
49. 49Damage to our reputation may adversely affect our revenues and profitability
50. 50Failure to respond to rapid changes in technology could adversely affect our results of operations or financial condition
51. 51We may not be able to protect our intellectual property and may be subject to infringement claims
52. 52We are the subject of various legal proceedings that could have a material adverse effect on our results of operations
53. 53We operate in a highly competitive industry, which could limit our ability to gain or maintain our position in the industry and could materially adversely affect our business, financial condition and results of operations33% rewritten
54. 54The loss of key personnel could negatively affect our financial results and impair our operating abilities