What the changes say
- Artificial intelligence is now identified as a new operational, legal and regulatory risk for RGA and its third parties.
- Pricing and reserve assumptions now emphasize investment returns and expenses, alongside mortality, morbidity and lapse experience.
- International risks now focus more on regulation, government action, tax uncertainty and market-access restrictions.
- Foreign-currency, macroeconomic-policy and reinsurance-recapture risks were removed as standalone disclosures.
What changed since the prior 10-K
New
- NewRisks Related to Our Business
Unfavorable assumption updates and variances from expected experience may be significant, and this could materially adversely affect our financial condition and results of operations and may require us to generate or fund additional capital in our businesses
Actual investment returns, expenses and other experience may diverge materially from pricing and reserve assumptions, requiring additional capital.
- NewRisks Related to Our Business
The development and adoption of artificial intelligence and its use and anticipated use by us or by third parties on whom we rely, may increase the operational risks discussed above or create new operational risks that we are not currently anticipating, which may otherwise adversely impact us
RGA’s and its third parties’ growing use of artificial intelligence could create operational, legal and regulatory problems.
Dropped
- DroppedRisks Related to Our Business
We are exposed to foreign currency risk
- DroppedRisks Related to Our Business
markets and the economy generally and dispelling it may require governments to pursue a restrictive fiscal and monetary policy, which could constrain overall economic activity, inhibit revenue growth and reduce the number of attractive investment opportunities
- DroppedRisks Related to Our Investments
Recapture rights permit these customers to reassume all or a portion of the risk formerly ceded to us after an agreed-upon time, usually ten years, subject to various conditions
Reworded
- 71% rewrittenRisks Related to Our Business
We could be subject to additional income tax liabilities
Tax risks now specifically include deferred tax assets for foreign tax credits and net operating and capital losses, not just unrealized securities losses.
- 69% rewrittenRisks Related to Our Business
Our international operations involve inherent risks
The international-operations risk now emphasizes regulation, government sovereignty and actions, political or social instability, tax uncertainty and market-access restrictions; growth-management concerns were removed.
- 59% rewrittenRisks Related to Our Investments
Interest rate fluctuations and economic disruptions could negatively affect the income we derive from the difference between the interest rates we earn on our investments and interest we pay under our reinsurance contracts
No substantive change; the risk remains that interest-rate changes reduce spreads between investment earnings and credited reinsurance rates.
Was: Interest rate fluctuations could negatively affect the income we derive from the difference between the interest rates we earn on our investments and interest we pay under our reinsurance contracts
- 59% rewrittenRisks Related to Our Business
We operate in a highly competitive and dynamic industry and competition and other factors could adversely affect our business
Competitors are now described as having greater financial flexibility as well as greater financial resources.
Was: We operate in a highly competitive and dynamic industry and competition, tax law changes, and other factors could adversely affect our business
- 55% rewrittenRisks Related to Our Investments
We could be forced to sell investments at a loss to cover policyholder withdrawals, recaptures of reinsurance treaties or other events
The disclosure now refers to RGA’s insurance subsidiaries rather than reinsurance subsidiaries, with no substantive change to the liquidity risk.
- 48% rewrittenRisks Related to Our Business
We make assumptions when pricing our business relating to mortality, morbidity, lapsation, investment returns, expenses and other factors, and significant deviations in experience compared to our initial expectations could negatively affect our financial condition and results of operations
The risk now covers investment returns and expenses and adds due diligence to the analysis supporting pricing assumptions.
Was: We make assumptions when pricing our products relating to mortality, morbidity, lapsation, investment returns and expenses, and significant deviations in experience could negatively affect our financial condition and results of operations
- 48% rewrittenRisks Related to Our Business
Weak conditions in global capital markets and the economy, as well as inflation, may materially adversely affect our business and results of operations
No substantive change; weak capital markets, economic conditions and inflation may reduce product demand and harm results and statutory capital.
- 47% rewrittenRisks Related to Our Business
Catastrophic events could adversely affect our business, financial condition and operations
The risk now highlights higher claims, affected-area economic disruption and investment valuation and interest-rate effects, while removing specific infrastructure and employee disruption language.
- 44% rewrittenRisks Related to Our Business
Our business, results of operations and financial condition have been, and may continue to be, adversely affected by epidemics and pandemics and responses thereto
Was: Our business, results of operations and financial condition have been, and may continue to be, adversely affected by epidemics and pandemics, such as COVID-19, and responses thereto
- 43% rewrittenRisks Related to Our Investments
Difficult conditions in the global capital markets and the economy generally may materially adversely affect our business, financial condition and results of operations
- 41% rewrittenRisks Related to Our Business
Acquisitions and significant transactions involve varying degrees of risk that could affect our profitability
- 36% rewrittenRisks Related to Our Investments
If our investment strategy is unsuccessful, we could suffer losses
- 32% rewrittenRisks Related to Our Business
Our insurance subsidiaries are highly regulated, and changes in these regulations could negatively affect our business
Was: Our reinsurance subsidiaries are highly regulated, and changes in these regulations could negatively affect our business
- 32% rewrittenRisks Related to Our Business
Restrictions on the use of personal data and “big data” techniques could adversely affect our reputation and have a material adverse effect on our business, financial condition and results of operations
- 29% rewrittenRisks Related to Our Business
Our risk management policies and procedures could leave us exposed to unidentified or unanticipated risk, which could negatively affect our business, financial condition or results of operations
- 25% rewrittenRisks Related to Our Business
RGA is an insurance holding company, and our ability to pay principal, interest and dividends on securities is limited
- 25% rewrittenRisks Related to Our Business
Changes in equity markets, interest rates and volatility affect the profitability of variable annuities with guaranteed living benefits that we reinsure, which may have a material adverse effect on our business and profitability
- 25% rewrittenRisks Related to Our Business
A downgrade in our ratings or in the ratings of our insurance subsidiaries could adversely affect our ability to compete
Was: A downgrade in our ratings or in the ratings of our reinsurance subsidiaries could adversely affect our ability to compete
- 24% rewrittenRisks Related to Our Business
We rely significantly on third parties for various services, and we may be held responsible for obligations that arise from the acts or omissions of third parties
- 22% rewrittenRisks Related to Our Investments
The liquidity and value of some of our investments may become significantly diminished
- 21% rewrittenRisks Related to Our Business
Changes in accounting standards may adversely affect our reported results of operations and financial condition
All 37 risk factors
Headings as the filing states them, in filing order.
Risks Related to Our Business
- 01We make assumptions when pricing our business relating to mortality, morbidity, lapsation, investment returns, expenses and other factors, and significant deviations in experience compared to our initial expectations could negatively affect our financial condition and results of operations48% rewritten
- 02Unfavorable assumption updates and variances from expected experience may be significant, and this could materially adversely affect our financial condition and results of operations and may require us to generate or fund additional capital in our businessesNew
- 03Our business, results of operations and financial condition have been, and may continue to be, adversely affected by epidemics and pandemics and responses thereto44% rewritten
- 04Acquisitions and significant transactions involve varying degrees of risk that could affect our profitability41% rewritten
- 05Our insurance subsidiaries are highly regulated, and changes in these regulations could negatively affect our business32% rewritten
- 06A downgrade in our ratings or in the ratings of our insurance subsidiaries could adversely affect our ability to compete25% rewritten
- 07The availability and cost of collateral, including letters of credit, asset trusts and other credit facilities, as well as regulatory changes relating to the use of captive insurance companies, could adversely affect our business, financial condition or results of operations
- 08Changes in equity markets, interest rates and volatility affect the profitability of variable annuities with guaranteed living benefits that we reinsure, which may have a material adverse effect on our business and profitability25% rewritten
- 09RGA is an insurance holding company, and our ability to pay principal, interest and dividends on securities is limited25% rewritten
- 10Our international operations involve inherent risks69% rewritten
- 11We rely significantly on third parties for various services, and we may be held responsible for obligations that arise from the acts or omissions of third parties24% rewritten
- 12We operate in a highly competitive and dynamic industry and competition and other factors could adversely affect our business59% rewritten
- 13Weak conditions in global capital markets and the economy, as well as inflation, may materially adversely affect our business and results of operations48% rewritten
- 14We could be subject to additional income tax liabilities71% rewritten
- 15Changes in accounting standards may adversely affect our reported results of operations and financial condition21% rewritten
- 16Our risk management policies and procedures could leave us exposed to unidentified or unanticipated risk, which could negatively affect our business, financial condition or results of operations29% rewritten
- 17The development and adoption of artificial intelligence and its use and anticipated use by us or by third parties on whom we rely, may increase the operational risks discussed above or create new operational risks that we are not currently anticipating, which may otherwise adversely impact usNew
- 18Restrictions on the use of personal data and “big data” techniques could adversely affect our reputation and have a material adverse effect on our business, financial condition and results of operations32% rewritten
- 19Managing key employee attraction, retention and succession is critical to our success
- 20Catastrophic events could adversely affect our business, financial condition and operations47% rewritten
- 21Litigation and regulatory investigations and actions may result in financial losses or harm our reputation
Risks Related to Our Investments
- 22Adverse capital and credit market conditions and access to credit facilities may significantly affect our ability to meet liquidity needs, access to capital and cost of capital
- 23Difficult conditions in the global capital markets and the economy generally may materially adversely affect our business, financial condition and results of operations43% rewritten
- 24If our investment strategy is unsuccessful, we could suffer losses36% rewritten
- 25Interest rate fluctuations and economic disruptions could negatively affect the income we derive from the difference between the interest rates we earn on our investments and interest we pay under our reinsurance contracts59% rewritten
- 26The liquidity and value of some of our investments may become significantly diminished22% rewritten
- 27We could be forced to sell investments at a loss to cover policyholder withdrawals, recaptures of reinsurance treaties or other events55% rewritten
- 28Defaults, downgrades or other events impairing the value of our fixed maturity securities portfolio may reduce our earnings
- 29The defaults or deteriorating credit of other financial institutions could adversely affect us
- 30Defaults on our mortgage loans or the mortgage loans underlying our investments in mortgage-backed securities and volatility in performance of our investments in real estate related assets may adversely affect our profitability
- 31Our valuation of fixed maturity and equity securities and derivatives include methodologies, estimations and assumptions that are subject to differing interpretations and could result in changes to investment valuations that may have a material adverse effect on our financial condition or results of operations
- 32The determination of the amount of allowances and impairments taken on our investments is highly subjective and could materially affect our financial condition or results of operations
- 33Our investments are reflected within the consolidated financial statements utilizing different accounting bases and accordingly we may not have recognized differences, which may be significant, between cost and fair value in our consolidated financial statements
Risks Related to Ownership of Our Common Stock
- 34We may not pay dividends on our common stock
- 35Certain provisions in our articles of incorporation and bylaws, in Missouri law and in applicable insurance laws, may delay or prevent a change in control, which could adversely affect the price of our common stock
- 36Issuing additional shares may dilute the value or affect the price of our common stock
- 37The occurrence of various events may adversely affect the ability of RGA and its subsidiaries to fully utilize any net operating losses (“NOLs”) and other tax attributes
Other Reinsurance Group of America 10-Ks
- FY2024 10-K risk factors38 risks
Reinsurance pricing depends on mortality and morbidity assumptions that may prove inaccurate. Financial results are heavily exposed to global economic conditions, interest rate fluctuations, and credit markets. Strict regulations govern subsidiaries, reserve requirements, and capital adequacy.
Filed Feb 21, 2025
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.