What dominates the section
- Insurance guarantees, reinsurance arrangements and ratings expose earnings, capital and policyholder behavior to market and counterparty pressures.
- Asset-management and accumulation revenues depend on retaining clients and assets despite changing investor preferences.
- International operations, technology, vendors and fraud create operational, cyber and regulatory vulnerabilities across the business.
The risks most specific to Principal Financial Group
- Risks relating to our business
Guarantees within certain of our products that protect policyholders may decrease our net income or increase the volatility of our results of operations or financial position under U.S. GAAP if our hedging or risk management strategies prove ineffective or insufficient
Variable-annuity death and withdrawal guarantees could reduce or destabilize earnings if hedging against interest rates, equity markets and volatility fails.
- Risks relating to our business
Our reinsurers could default on their obligations or increase their rates, which could adversely impact our net income and financial condition
Reinsurer insolvency or higher reinsurance pricing could impair recoveries and increase costs across life, annuity, disability, medical and long-term-care insurance.
- Risks relating to our business
We face risks in administering coinsurance with funds withheld reinsurance agreements
Administration of funds-withheld reinsurance with Talcott could create risks for ceded U.S. retail fixed-annuity and ULSG blocks.
- Risks relating to our business
We may need to fund deficiencies in our Closed Block assets
Principal Life may need to fund deficiencies in Closed Block assets supporting participating ordinary life policies.
- Risks relating to our business
Client terminations or withdrawals or changes in investor preferences may lead to a reduction in revenues for our asset management and accumulation businesses
Asset-management and accumulation clients can withdraw funds or terminate relationships quickly, reducing fee revenue tied to assets under management.
- Risks relating to our business
Our international businesses face political, legal, operational and other risks that could reduce our profitability in those businesses
International businesses face discriminatory regulation, nationalization, price or exchange controls, and restrictions on transferring funds out of host countries.
- General risks
Technological and societal changes may disrupt our business model and impair our ability to retain existing customers, attract new customers and maintain our profitability
Rapid AI-driven changes could disrupt marketing, distribution, underwriting and pricing of financial-services products and weaken Principal’s competitive position.
- General risks
Loss of or disruption in key vendor relationships and services or failure of a vendor to protect information of our customers or employees could adversely affect our business or result in losses
Vendor bankruptcy, service interruptions or failures to protect customer and employee information could disrupt operations and cause losses.
- Risks relating to our business
We face risks arising from fraudulent activities
Fraudulent claims and theft targeting retirement participants or individual product owners could increase claims, prevention and detection costs.
All 19 risk factors
Headings as the filing states them, in filing order.
Risks relating to our business
- 01A downgrade in our financial strength or credit ratings may increase policy surrenders and withdrawals, reduce new sales, terminate relationships with distributors, impact existing liabilities and increase our cost of capital, any of which could adversely affect our profitability and financial condition
- 02Any of these consequences could adversely affect our profitability and financial condition
- 03Client terminations or withdrawals or changes in investor preferences may lead to a reduction in revenues for our asset management and accumulation businesses
- 04Guarantees within certain of our products that protect policyholders may decrease our net income or increase the volatility of our results of operations or financial position under U.S. GAAP if our hedging or risk management strategies prove ineffective or insufficient
- 05Our international businesses face political, legal, operational and other risks that could reduce our profitability in those businesses
- 06We face risks arising from fraudulent activities
- 07We face risks arising from our participation in joint ventures
- 08We may need to fund deficiencies in our Closed Block assets
- 09Our reinsurers could default on their obligations or increase their rates, which could adversely impact our net income and financial condition
- 10We face risks arising from future acquisitions of businesses
- 11We face risks in administering coinsurance with funds withheld reinsurance agreements
General risks
- 12A pandemic, terrorist attack, military action or other catastrophic event could adversely affect our operations, net income or financial condition
- 13Our financial results may be adversely impacted by global climate changes
- 14Technological and societal changes may disrupt our business model and impair our ability to retain existing customers, attract new customers and maintain our profitability
- 15Damage to our reputation may adversely affect our revenues and profitability
- 16We may not be able to protect our intellectual property and may be subject to infringement claims
- 17If we are unable to attract, develop and retain qualified employees and sales representatives and develop new distribution sources, our results of operations, financial condition, strategic growth commitments and sales of our products may be adversely impacted
- 18Loss of or disruption in key vendor relationships and services or failure of a vendor to protect information of our customers or employees could adversely affect our business or result in losses
- 19Our enterprise risk management framework may not be fully effective in identifying or mitigating all the risks to which we are exposed
Other Principal Financial Group 10-Ks
- 2026 10-K risk factors
53 risks, 38 new, 4 dropped, 12 reworded since the prior year. New risks emphasize investment-credit losses, liquidity pressure and collateral demands across Principal’s asset portfolio.
Filed Feb 18, 2026
About this page
Item 1A of the 10-K on EDGAR was split into its risk factors and, where the company's previous 10-K is on file, each heading was matched to last year's and the text compared word for word. The headings are the filing's own. The one-line readings and the overview were written by a language model from the text of the new, dropped, and rewritten risks; they refer to risks by position and cannot misquote a heading.