Q2 2024 Globe Life Inc Earnings Call

Operator: This concludes the session. You may register for questions by pressing star 1 on your telephone keypad.

Our questions by pressing star one on your telephone keypad and now I'd like to hand, the call over to Steven Mora. Please go ahead.

Stephen Mota: And now, I'd like to hand the call over to Stephen Mota. Please go ahead. Thank you. Good morning, everyone. Joining the call today are Frank Svoboda and Matt Darden, our Co-Chief Executive Officers, Tom Kalmbach, our Chief Financial Officer, Mike Majors, our Chief Strategy Officer, and Brian Mitchell, our General Counsel. Some of our comments or answers to your questions may contain forward-looking statements that are provided for general guidance purposes. Accordingly, please refer to our earnings release 2023-10-K and any subsequent forms 10-Q on file with the FBI.

Thank you good morning, everyone. Joining the call today are frankly, better and Matt Darden, Our co Chief Executive officers, Tom Palmer, Our Chief Financial Officer, Mike Majors, our Chief strategy Officer, and Brian Mitchell, Our general counsel some of our comments or answers to your questions may contain forward looking statements that are provided for general guidance purposes only.

Accordingly, please refer to our earnings release about 2023 10-K any subsequent forms 10-Q on file with the SEC. Some of our comments may also contain non-GAAP measures. Please see our earnings release and website for discussion of these terms and reconciliations to GAAP measures I will now turn the call over to Frank.

Stephen Mota: Some of our comments may also contain non-GAAP measures. Please see our earnings release and website for a discussion of these terms and reconciliations to GAAP measures. I will now turn the call over to Stephen. Thank you, Stephen. And good morning, everyone.

Thank you Steven and good morning, everyone.

Frank Martin Svoboda: In the second quarter, net income was $258 million, or $2.83 per share, compared to $215 million, or $2.24 per share, a year ago. Net operating income for the quarter was $271 million, or $2.97 per share, an increase of 14% from a year ago. On a GAAP-reported basis, return on equity through June 30 is 20.8%, and book value per share is $58.60. Excluding Accumulated Other Comprehensive Income, or AOCI, return on equity is 14.5%, and book value per share as of June 30th is $82.38, up 14% from a year ago.

In the second quarter, net income was $258 million or $2 83 per share compared to $215 million or $2 at 24, a share a year ago.

Net operating income for the quarter was $271 million or $2 97 per share an increase of 14% from a year ago.

On a GAAP reported basis return on equity through June 30th is 28% and book value per share was $58 six.

Excluding accumulated other comprehensive income or OCI return on equity is 14, 5% and book value per share as of June 30th Z $2 38 sets up 14% from a year ago.

Frank Martin Svoboda: Before we continue, we would like to address in advance the status of the independent review conducted by the Audit Committee of Globe Life's Board of Directors regarding allegations levied against the company by short sellers. On June 22, 2024, Globe Life filed an AK addressing this matter. As noted in the 8K, the Audit Committee of our Board of Directors conducted an independent investigation of allegations contained in various short-seller reports. The Audit Committee was assisted in its review by the law firm Glomer Hale and the forensic accounting firm FTI Consulting.

Before we continue we would like to address an advanced the status of the independent review conducted by the audit Committee of Globe Life's Board of directors regarding allegations levied against the company by short sellers.

At June 22nd 2024 globally filed an 8-K addressing this matter as noted in the 8-K. The audit Committee of our board of Directors conducted an independent investigation of allegations contained in various short seller reports.

The audit Committee was assisted in its review by the law firm Global Hale and the forensic accounting firm STI consulting.

Frank Martin Svoboda: The scope of the independent review included all allegations that raised specific questions about the accuracy and integrity of the company's financial statements and disclosures. It also included the company's process for preventing, identifying, and responding to misconduct. As stated, the Audit Committee has completed its review and determined that the allegations of financial misconduct were not supported.

The scope of the independent review included all allegations that raise specific questions about the accuracy and integrity of the company's financial statements and disclosures.

It also included the company's process for preventing identifying and responding to misconduct.

As stated the audit Committee has completed its review and determined that the allegations of financial misconduct were not supportive. Additionally.

Frank Martin Svoboda: Additionally, the independent review did not identify any matters requiring adjustments to the company's previously issued financial statements or related disclosures in its filings with the Securities and Exchange Commission. We believe the allegations were false and misleading and were designed to drive down Globe Life's stock price in an effort for the short sellers to profit at the expense of our long-term shareholders. The company stands by its financial results and disclosures, which remain accurate and do not require any adjustment. In addition, the audit committee reviewed and confirmed that the company has policies and procedures in place designed to safeguard the quality of the work experience.

Additionally, the independent review did not identify any matters requiring adjustments to the company's previously issued financial statements or related disclosures in our filings with the Securities and Exchange Commission.

We believe the allegations were false and misleading and were designed to drive down globalize stock price and an effort for the short sellers to profits at the expense of our long term shareholders.

The company stands by its financial results and disclosures, which remains accurate and do not require any adjustment.

In addition, the audit committee reviewed it confirms that the company has policies and procedures in place designed to safeguard the quality of the work experience.

Frank Martin Svoboda: Compliance with our Code of Conduct, both internally and in connection with our third-party relationships, is and will continue to be a key focus area for management. On separate but related matters, we'd like to update you regarding the SEC inquiry and the DOJ request. As we have previously disclosed, the company received an inquiry from the staff of the Securities and Exchange Commission. The company and the Audit Committee have provided information in response to the SEC's request received today, and the company is cooperating fully and will continue to do so.

Compliance with our code of conduct both internally and in connection with our third party relationships is and will continue to be a key focus area for management.

And separate that related issues, we'd like to update you regarding the inquiry by the SEC and the request by the Doj.

As we have previously disclosed the company received an inquiry from the staff of the Securities and Exchange Commission.

The company and the audit Committee has provided information in response to the Sec's request received today.

And the company is cooperating fully and we'll continue to do so.

Frank Martin Svoboda: At this time, the SEC has not asserted any claims against the company or indicated it intends to do so. Regarding the DOJ, we continue to fully cooperate in responding to requests related to sales practices by certain licensed insurance agents in the area's organization who are contracted to sell American Income Policy. The DOJ has not asserted any claims or made allegations against the company or American income, or indicated it intends to do so.

At this time the FCC has not asserted any claims against the company or indicated it tends to do so.

Regarding the Doj, we continue to fully cooperate and responding to request related to sales practices by certain licensed insurance agents in the areas organization, who are contracted to sell American income policies.

The Doj has not asserted any claims are made allegations against the company or American income.

Or indicated it intends to do so.

Frank Martin Svoboda: In conclusion, we'd like to discuss the questions we have received regarding ongoing litigation and the company's process for identifying, assessing, and remediating complaints related to alleged misconduct. The various allegations are the subject of litigation at a variety of stages, and, as you can appreciate, it would not be appropriate for us to comment on terminated contracts or pending lawsuits. But, as we have discussed in prior calls, Globe Life takes unethical conduct and any allegations brought to our attention concerning harassment... Inappropriate Conduct or Unethical Business Practices Series, and we do not tolerate such behavior.

In conclusion, we would like to discuss the questions. We have received regarding ongoing litigation and the company's process for identifying assessing and remediated complaints related to alleged misconduct.

The various allegations are subject of litigation in a variety of stages and as you can appreciate it would not be appropriate for us to comment on terminated contracts are pending lawsuits.

But as we've discussed in prior calls globalized takes unethical conduct and Amy allegations brought to our attention concerning harassment.

Inappropriate conduct or an ethical business practices seriously.

And we do not tolerate such behavior.

Frank Martin Svoboda: The company has reasonable and appropriate systems in place that are designed to detect and mitigate misconduct and attempted fraudulent activity. Globe Life has a long history of integrity in our business practices and principles while providing our customers with financial protection, as well as work opportunities for agents, small business owners, and employees to build financial security. We are focused on results and the continued strategic growth of Globe Life. Our field force of approximately 17,000 agents and our 3,500 employees are focused and dedicated to helping families make tomorrow better by working to protect their financial future. And together, we strive to act in accordance with the highest levels of ethics and integrity at all levels of the organization. Now, Frank, let's talk about our results with respect to our insurance options. Thanks Matt.

The company has reasonable and appropriate systems in place that are designed to detect and mitigate in this context and attempted fraudulent activities.

Frank Martin Svoboda: In our life insurance operations, premium revenue for the second quarter increased 4% from the year-ago quarter to $815 million. Life underwriting margin was $320 million, up 8% from a year ago, driven by the premium growth and lower overall policy obligations.

Global life has a long history of integrity, and our business practices and principles, while providing our customers with financial protection as well as work opportunities for agents small business owners and employees to build financial security.

We are focused on results and the continued strategic relative globe life.

Our field force of approximately 17000 agents and our 3500 employees are focused and dedicated to helping families make tomorrow better are working to protect their financial futures and together, we strive to act in accordance with the highest levels of ethics and integrity at all.

Levels of the organization now.

Frank lets talk about our results with respect to our insurance operations. Thanks, Matt.

In our life insurance operations premium revenue for the second quarter increased 4% from the year ago quarter to $815 million.

Life underwriting margin was $320 million up 8% from a year ago driven.

Driven by the premium growth and lower overall policy obligations.

Frank Martin Svoboda: For the year, driven by strong premium growth in both our American Income and Liberty National Divisions, we expect life premium revenue to grow between 4.5% and 5% at the midpoint of our guidance, and life underwriting margin to grow between 9% and 10%. As a percent of premium, we anticipate life underwriting margin to be in the range of 39 to 41%, and Health Insurance. Premium grew 7% to $352 million, and the health underwriting margin was at 9% to $100 million. For the year, we expect health premium revenue to grow approximately 6.5% to 7%.

For the year driven by strong premium growth in both our American income and Liberty National divisions, We expect life premium revenue to grow between four and a half at 5% at the midpoint of our guidance and life underwriting margin to grow between nine and 10%.

As a percent of premium we anticipate life underwriting margin to be in the range of 39% to 41%.

In health insurance premiums grew 7% to $352 million and health underwriting margin was up 9% to $100 million.

For the year, we expect health premium revenue to grow approximately six 5% to 7%.

Frank Martin Svoboda: And at the midpoint of our guidance for the full year, we expect health underwriting margin to grow between 1% and 2%, and as a percent of premium, to be between 27% and 29%. Administrative expenses were $82 million for the quarter, up 9% from a year ago.

And at the midpoint of our guidance for the full year, we expect health underwriting margin to grow between 1% and 2% and as a percentage of premium to be between <unk> 27 and 29%.

Administrative expenses were $82 million for the quarter up 9% from a year ago as a percentage of premium administrative expenses were 7% consistent with our expectations compared to six 8% a year ago.

Frank Martin Svoboda: As a percentage of premium, administrative expenses were 7%, consistent with our expectation, prepared to 6.8% a year. For the full year 2024, we expect administrative expenses to be approximately 7% of premium. I will now turn the call over to Matt for his comments on the second quarter marketing options. Thank you, Frank.

For the full year 2024, we expect administrative expenses to be approximately 7% of premium.

I will now turn the call over to Matt for his comments on the second quarter marketing operations. Thank.

James Matthew Darden: First, I'd like to discuss American Income Wise. Here, the life premiums were up 7% over the year-ago quarter to $424 million, and the life underwriting margin was up 7% to $193 million. In the second quarter of 2024, net life sales were $95 million, and this is up 16% from a year ago. And it's primarily due to the strong growth in our age.

Thank you Frank first I'd like to discuss American income life.

Here the life premiums were up 7% over the year ago quarter to $424 million and life underwriting margin was up 7% to $193 million.

In the second quarter of 2024 net life sales were $95 million and this is up 16% from a year ago and is primarily due to the strong growth in our agent count.

James Matthew Darden: The average producing agent count for the second quarter was 11,869, and that is up 13% from a year ago. We are seeing strong recruiting activity along with continued improvement in new agent retention. Our new power pipeline for the second quarter is up 16% from the prior year, and I'm very pleased with the sales productivity and aging count trends at American Indian. At Liberty National, life premiums were up 6% over the year-ago quarter to $92 million, and the life underwriting margin was up 9% to $31 million.

The average producing agent count for the second quarter was 11869 and that is up 13% from a year ago.

We are seeing strong recruiting activity along with continued improvement in new agent retention.

Our new higher pipeline for the second quarter is up 16% from the prior year.

And I am very pleased with the sales productivity and agent count trends at American income.

At Liberty National Life premiums were up 6% over the year ago quarter to $92 million and our life underwriting margin was up 9% to $31 million net.

James Matthew Darden: Net life sales increased 11% to $26 million, and net health sales were $8 million, which is up 4% from the year ago. The growth of both the life and the health cells was due primarily to the increase in The average producing agent count for the second quarter was 3,700, which is up 16% from a year ago.

Net life sales increased 11% to $26 million and net health sales were $8 million, which is up 4% from the year ago quarter.

The growth in both the life and health sales was due primarily to the increase in agent count.

The average producing agent count for the second quarter was 3700.

Is up 16% from a year ago.

James Matthew Darden: Liberty National continues to generate positive recruiting and sales momentum, and this is driven by our investments in technology and the growth in middle management. At Family Heritage, health premiums increased 8% over the year-ago quarter to $106 million, and Health Underwriting Margin increased 12%. [inaudible] Net health sales were up 7% to $25 million, and this was primarily due to an increase in agent product sales. The average producing agent count for the second quarter was 1,361.

Liberty National continues to generate positive recruiting and sales momentum and this is driven by our investments in technology and the growth in middle management.

At family Heritage Health premiums increased 8% over the year ago quarter to $106 million and health underwriting margin increased 12% to $37 million.

Net health sales were up 7% to $25 million and this is primarily due to an increase in agent productivity.

The average producing agent count for the second quarter was 1361 and.

James Matthew Darden: And this is up 1% from a year ago. And, as we've said before, we continue to emphasize recruiting and middle management development at Family Heritage. And I am encouraged as we have started to see middle management growth, which is up 11% from year end. In our direct-to-consumer division at Globe Life, life premiums were flat compared to the year-ago quarter at $249 million, while the life underwriting margin increased 13% to $64 million, and this was due primarily to favorable mortality and continued efforts to maximize our margin dollars. Net life sales were $31 million, and that was down 3% from the year ago.

And this is up 1% from a year ago.

And as we've said before we continue to emphasize recruiting and middle management development at family Heritage and.

And I encourage as we have started to see middle management growth, which is up 11% from year end.

And our direct to consumer Division at Globe life life premiums were flat compared to the year ago quarter at $249 million.

While the life underwriting margin increased 13% to $64 million and is due primarily to favorable mortality and continued efforts to maximize our margin dollars net.

Net life sales were $31 million and is down 3% from the year ago quarter.

James Matthew Darden: As we have previously mentioned, the decline in sales is primarily due to lower customer inquiries, as we have reduced marketing spend on certain campaigns that do not meet our profit objectives. Our focus in this area is having a positive impact on our overall market. We will continue to focus on maximizing and underwriting margin dollars on new sales by managing the rising advertising and distribution costs associated with acquiring new business. Additionally, as a reminder, the Direct-to-Consumer channel provides support to our agency business through brand impressions and generation of sales. At United American General Agency, our health premiums increased 9% over the year-ago quarter to $149 million.

As we have previously mentioned the decline in sales is primarily due to lower customer inquiries as we've reduced marketing spend on certain campaigns that do not meet our profit objectives.

Our focus in this area is having a positive impact on our overall margin.

We will continue to focus on maximizing underwriting margin dollars on new sales by managing the rising advertising and distribution costs associated with acquiring new business.

Additionally, as a reminder, the direct to consumer channel provides support to our agency business through brand impressions and the generation of sales leads.

At United American General Agency, our health premiums increased 9% over the year ago quarter to $149 million.

James Matthew Darden: Health Underwriting Margin was $17 million and is up approximately $2 million from the year ago. Net health sales were $18 million, and this is up approximately $7 million over the year ago. And it's due primarily to improved market conditions for a Medicare supplement bill. Now I'd like to discuss projections.

Health underwriting margin was $17 million and is up approximately $2 million from the year ago quarter.

Net health sales were $18 million and this is up approximately $7 million over the year ago quarter, and it's due primarily to improved market conditions for our Medicare supplement business.

Now I'd like to discuss projections.

James Matthew Darden: Based on the trends that we are seeing and the experience with our business, we expect the average producing agent count trends for 2024 to be as follows: At American income, low double-digit growth, and Liberty National, Mid-Teens Growth, and Family Heritage Mid-Single-Digit Growth. Now our net life sales for 2024 are projected to be as follows, and American Income, Mid-Teens Growth. Now here we are raising our guidance at American Income to reflect our strong second quarter experience along with the trends we are seeing. Last quarter, we had tempered our projections just out of an abundance of caution. Liberty National Sales anticipates low double-digit growth and direct-to-consumer slightly down.

Based on the trends that we're seeing and experienced with our business. We expect the average producing agent count trends for 2024 to be as follows.

At American income low double digit growth at Liberty National mid teens growth and at family Heritage mid single digit growth.

Now our net life sales for 2024 are projected to be as follows.

At American income mid teens growth.

Now here, we are raising our guidance at American income to reflect strong second quarter experience along with the trends we are seeing.

Last quarter, we had tempered our projections just out of an abundance of caution.

Liberty National sales dissipate low double digit growth and direct to consumer slightly down.

James Matthew Darden: Net health sales for 2024 are expected to be as follows: Liberty National, High Single-Digit Growth, and Family Heritage, also High Single-Digit Road, and United American General Agency, low to mid-single-digit growth. I'll turn the call back to Frank.

Net health sales for 2024 are expected to be as follows.

Liberty National high single digit growth and at family Heritage also high single digit growth in the United American General agency low to mid single digit growth.

Now I'll turn the call back to Frank.

Frank Martin Svoboda: Thanks, Matt. We will now turn to the investment operation. Excess investment income, which we define as net investment income less only required interest, was $43 million, up $11 million from the year-ago quarter. Net investment income was $286 million, up 9%, or $24 million from the year ago.

Thanks, Matt we will now turn to the investment operations.

Excess investment income, which we define as net investment income less all the required interest was $43 million up $11 million from the year ago quarter.

Net investment income was $286 million.

Up 9% or $24 million from the year ago quarter.

Frank Martin Svoboda: The increase is largely due to strong 6% growth in average invested assets over that period. In addition, higher interest rates across fixed maturities, commercial mortgage loans, limited partnerships, and short-term investments also contributed to the higher growth. The required interest is up approximately 5.5% over the year ago, slightly higher than the 5% growth in average policy liability. For the full year, we expect net investment income to grow between 7% and 8% due to the combination of the favorable interest rate environment and steady growth in our invested assets.

The increase is largely due to strong 6% growth in average invested assets over that period.

In addition, higher interest rates across fixed maturities commercial mortgage loans limited partnerships and short term investments also contributed to the higher growth rate.

Required interest is up approximately five and one 5% over the year ago quarter slightly higher than the 5% growth in average policy liabilities.

For the full year, we expect net investment income to grow between 7% to 8% due to the combination of the favorable interest rate environment and steady growth in our invested assets.

Frank Martin Svoboda: In addition, at the midpoint of our guidance, we anticipate required interest will grow around 5 to 5.5% for the year, resulting in growth in excess investment income of approximately 20 to 25%. And with respect to our investment yield, in the second quarter, we invested $241 million in investment-grade fixed maturity, primarily in the industrial and financial sectors. We invested at an average yield of 6.16%, an average rating of A-, and an average life of 35 years.

In addition at the midpoint of our guidance, we anticipate required interest will grow around five to five 5% for the year, resulting a growth in excess investment income of approximately 20% to 25%.

Now with respect to our investment yield in the second quarter, we invested $241 million in investment grade fixed maturities, primarily in the industrial and financial sectors.

We invested at an average yield of 616% an average rating of a minus and an average life of 35 years.

Frank Martin Svoboda: We also invested approximately $115 million in commercial mortgage loans and limited partnerships that have debt-like characteristics and an average expected cash return of approximately 10%. However, none of our direct investments in commercial mortgage loans involved office property.

We also invested approximately $115 million in commercial mortgage loans and limited partnerships that have debt like characteristics and an average expected cash return of approximately 10%.

None of our direct investments and commercial mortgage loans involved office properties.

Frank Martin Svoboda: These investments are expected to produce additional cash yields over our fixed maturity investments, and they are in line with our conservative investment philosophy. For the Fixed Maturity Portfolio, the second quarter yield was 5.26%, up eight basis points from the second quarter of 2023 and up two basis points for the first quarter. As of June 30th, the portfolio yield was 5.24%. Including the cash yield from our commercial mortgage loans and limited partnerships, our second quarter earned yield was 5.44%.

These investments are expected to produce additional cash yield over our fixed maturity investments and they are in line with our conservative investment philosophy.

For the fixed maturity portfolio, the second quarter yield was $5 two 6% up eight basis points from the second quarter 2023, and up two basis points for the first quarter.

As of June 30, the portfolio yield was 524%.

Including the cash yield from our commercial mortgage loans at a limited partnerships. The second quarter earned yield was 544%.

Frank Martin Svoboda: Now regarding the investment portfolio, invested assets are $21.3 billion, including $19.2 billion from fixed maturities at amortized costs. Of the fixed maturities, $18.7 billion are investment grade with an average rating of A-. Overall, the Total Fixed Maturity Portfolio is rated A-, the same as a year ago. Our fixed maturity portfolio has a net unrealized loss position of approximately $1.6 billion due to the current market rates being higher than the book yield on our holdings.

Now regarding the investment portfolio <unk>.

Invested assets are $21 $3 billion, including $19 2 billion from fixed maturities at amortized cost.

Of the fixed maturities $18 7 billion are investment grade with an average rating of a minus.

Overall, the total fixed maturity portfolio is rated a minus same as a year ago.

Our fixed maturity portfolio has a net unrealized loss position of approximately $1 6 billion due to the current market rates being higher than the book yield on our holdings.

Frank Martin Svoboda: As we have historically noted, we are not concerned by the unrealized loss position, and it is mostly interest rate driven and currently relates entirely to bonds with maturities that extend beyond 10 years. We have the intent and, more importantly, the ability to hold our investments to maturity. Bonds rated BBB comprise 46% of the fixed maturity portfolio compared to 49% from the year ago.

As we have historically noted we are not concerned by the unrealized loss position and is mostly interest rate driven and currently relate to tire leader bonds with maturities that extend beyond 10 years.

We have the intent and more importantly, the ability to hold our investments to maturity.

Bonds rated triple B comprised 46% of the fixed maturity portfolio compared to 49% from the year ago quarter.

Frank Martin Svoboda: While this ratio is high relative to our peers, we have little or no exposure to higher-risk assets held by many of our peers, such as derivatives, equities, residential mortgages, real estate equities, CLOs, and other asset-backed securities. We believe that the BBB securities we acquire generally provide the best risk-adjusted, capital-adjusted returns, due in part to our ability to hold securities to The low investment-grade bonds remained low at $564 million, compared to $496 million a year ago.

While this ratio is high relative to our peers, we have little or no exposure to higher and higher risk assets held by many of our peers such as derivatives equities residential mortgages real estate equities Clo's and other asset backed securities.

We believe that the Triple B Securities. We acquire generally provides the best risk adjusted capital adjusted returns due in part to our ability to hold securities to maturity, regardless of fluctuations in interest rates or equity markets.

Below investment grade bonds remained low at $564 million.

Compared to $496 million a year ago.

Frank Martin Svoboda: The average of below investment grade bonds to total fixed maturities is 2.9%. During the quarter, we did take the opportunity to extend duration on a portion of our portfolio by selling some shorter maturity bonds and investing in longer-dated securities. While we realized a loss on some of the bonds sold, we were able to extend the average life and improve the overall yield of the portfolio, and we were able to reduce our exposure to smaller regional banks.

The average of below investment grade bonds to total fixed maturities is two 9%.

During the quarter, we did take the opportunity to extend duration on a portion of our portfolio by selling some shorter maturity bonds and investing in longer dated securities.

While we realized a loss on some of the bonds sold we were able to extend the average life and improve the overall yield of the portfolio and were able to reduce our exposure to smaller regional banks.

Frank Martin Svoboda: At the midpoint of our guidance for the full year, we expect to invest approximately $1.2 to $1.4 billion in fixed maturities with an average yield of 5.7 to 5.9 percent, and approximately $500 million to $600 million in commercial mortgage loans and limited partnership investments with debt-like characteristics and an average expected cash return of 8-10%. As we've said before, we are pleased to see higher interest rates, and this has a positive impact on operations by driving up net investment income with no impact on our future policy benefits. University of Michigan Extension

Speaker Change: At the midpoint of our guidance for the full year, we expect to invest approximately one two to one 4 billion in fixed maturities at an average yield of five seven to five 9% enterprise from a $5 million to $600 million of commercial mortgage loans and limited partnership investments with debt.

Speaker Change: <unk> characteristics and an average expected cash return of 8% to 10%.

Speaker Change: As we've said before we are pleased to see higher interest rates. As this has a positive impact on operating income by driving up net investment income with no impact to our future policy benefits since they are not interest sensitive.

Thomas Peter Kalmbach: Thank you. Thank you. Now, I'll turn the call over to Tom for his comments on capital and liquidity. Thanks, Frank. First, I'll spend a few minutes discussing our available liquidity, our share repurchase program, and our capital position. The parent began the quarter with liquid assets of approximately $65 million and ended the quarter with approximately $35 million of liquid assets.

Speaker Change: Now I'll turn the call over to Tom for his comments on capital and liquidity.

Tom: Thanks, Craig first let me spend a few minutes discussing our available liquidity share repurchase program and capital position.

Tom: The parent began the quarter with liquid assets of approximately $65 million and ended the quarter with approximately $35 million of liquid assets.

Thomas Peter Kalmbach: We anticipate concluding the year with liquid assets in the range of $50 to $60 million that we have historically targeted. In the second quarter, the company repurchased approximately 3.8 million shares. Inc. common stock for a total cost of just over $314 million at an average share price of $81.87. Resulting in repurchases to date of approximately 4 million shares for a total cost of approximately $330 million at an average share price of $83.17.

Tom: We anticipate concluding the year with liquid assets in the range of $50 million to $60 million that we have historically targeted.

Tom: In the second quarter, the company repurchased approximately three 8 million shares.

Speaker Change: Of Globe Life, Inc. Common stock for a total cost of just over $314 million at an average share price of $81 87.

Speaker Change: Resulting in repurchases to date of approximately 4 million shares for a total cost of approximately $330 million at an average share price of $83 17.

Thomas Peter Kalmbach: Including shareholder dividend payments of $23 million for the quarter, the company returned approximately $337 million to shareholders during the second quarter of 2024 alone. The parent company's excess cash flows, as we define it, results primarily from dividends received from the parent company from its subsidiaries, less interest paid on debt.

Speaker Change: Including shareholder dividend payments of $23 million for the quarter. The company returned approximately $337 million to shareholders. During the second quarter of 2024 alone.

Speaker Change: And has returned approximately $375 million year to date.

Speaker Change: The amount of share repurchases during the quarter as higher than usual as we took the opportunity to accelerate repurchases from the second half of the year given the favorable market conditions with share prices below our book value per share.

Speaker Change: We were able to finance this largely with excess cash flows during the quarter due to the timing of subsidiary dividends and the use of parents liquid assets.

Speaker Change: In addition to the liquid assets held by the parent the parent company will generate excess cash flows during the remainder of the year.

Speaker Change: Companys excess cash flows as we define it results primarily from dividends received from the parent from its subsidiaries less interest paid on debt.

Thomas Peter Kalmbach: We anticipate the parent company's excess cash flow for the full year will be approximately $440 million to $460 million and is available to return to its shareholders in the form of dividends and through repurchase. In addition, during the second half of the year... Now, with regard to our capital levels at the insurance subsidiaries, our goal is to maintain our capital at levels necessary to support our current ratings. Globe Life targets a consolidated company action RBC ratio in the range of 300 to 320 percent. At this ratio, our subsidiaries had, at that time, approximately $85 million of capital over the amount needed to meet the low end of the consolidated RBC target of 3000%.

Speaker Change: We anticipate the parent company's excess cash flow for the full year will be approximately 440 million to $460 million and is available to return to its shareholders in the form of dividends and share repurchases.

Speaker Change: As mentioned on previous calls, we will use our cash as efficiently as possible at this time, we believe that share repurchases provide the best return or yield to our shareholders over other available alternatives. Thus, we anticipate share repurchases will continue to be the primary source of sorry, the primary use of the parents.

Speaker Change: Excess cash flows after the payment of shareholder dividends.

Speaker Change: We intend to use 2020 for excess cash flows to purchase 350 million to $370 million during the year and distribute $85 million to $90 million to our shareholders in the form of dividends.

Speaker Change: In addition, during the second half of the year, we anticipate raising additional capital to support accelerated approximately $400 million.

Speaker Change: Of additional share repurchases in 2024.

Speaker Change: So for the full year at the midpoint of our earnings guidance, we anticipate approximately $750 million to $770 million of total share repurchases for the full year.

Speaker Change: Yeah.

Speaker Change: Now with regard to our capital levels at the insurance subsidiaries. Our goal is to maintain our capital at levels necessary to support our current ratings globalized targets, a consolidated company action RBC ratio in the range of 300% to 320%.

Speaker Change: At the end of 2023, our consolidated RBC was 314% at this ratio our subsidiaries had at that time, approximately $85 million of capital over the amount needed to meet the low end of the consolidated RBC target of 300% in.

Thomas Peter Kalmbach: In 2024, we currently estimate that no additional capital is needed to maintain the midpoint of our consolidated RBC target of 300 to 320%. Now, with regard to policy obligations during the current quarter, as we've discussed on prior calls, we have included within the supplemental financial information available on our website an exhibit that details the remeasurements gained or lost by distribution channels. As a reminder, in the third quarter of 2023, we updated both our life and health assumptions, and there have been no changes to our long-term assumptions in the period since.

Speaker Change: In 2024, we currently estimate that no additional capital as needed to maintain the midpoint of our consolidated RBC target of 300% to 320%.

Speaker Change: Now with regards to policy obligations during the current quarter as we've discussed on prior calls we have included within the supplemental financial information available on our website and exhibit the details the remeasurement gain or loss by distribution channel.

Speaker Change: As a reminder, in the third quarter of 2023, we updated both our life and health assumptions and there have been no changes to our long term assumptions in the period says no assumptions were made in the second quarter of 2024, and we intend to update life and health assumptions in the upcoming third quarter.

Thomas Peter Kalmbach: No assumptions were made in the second quarter of 2024, and we intend to update life and health assumptions in the upcoming third quarter. In addition to the impact of assumption changes, the remeasurement gain or loss also indicates experience fluctuation. For the second quarter of 2024, life policy obligations were favorable when compared to our assumptions of mortality and persistence.

In addition to the impact of assumption changes the remeasurement gain or loss also indicates experience fluctuations for the second quarter of 2024 life policy obligations were favorable winter when compared to our assumptions of mortality and persistency.

Speaker Change: The remeasurement gain related to experience fluctuations resulted in $12 million of lower life obligations and $3 million of lower health policy obligations.

Speaker Change: We continue to be encouraged by the recent short term trends in policies policy obligations experience.

Thomas Peter Kalmbach: The range of our earnings guidance encompasses potential future remeasurement impacts, inclusive of assumption changes, through the remainder of 2024. Recent and longer-term life and health mortality trends will inform the third quarter 2024 update to assumptions. So now, finally, with respect to our earnings guidance for 2024, for the full year 2024, we estimate net operating earnings per diluted share will be in the range of $11.80 to $12.10, representing 12% growth at the midpoint of the range. The $11.95 midpoint.

Speaker Change: The range of our earnings guidance encompasses potential future re measurement impacts inclusive of assumption changes through the remainder of 2024.

Speaker Change: Recent and longer term life, and health and mortality trends will inform the third quarter of 2024 update to assumptions.

Speaker Change: Now finally with respect to our earnings guidance for 2024 for the full year of 2024, we estimate net operating earnings per diluted share will be in the range of $11 80 to $12 <unk> representing.

Speaker Change: Representing 12% growth at the midpoint of the range.

Speaker Change: The $11, 95% $95 mid point is.

Thomas Peter Kalmbach: It's higher than our previous guidance and reflects recent anticipated improvements in underwriting income results, in addition to a greater impact from share repurchases than previously anticipated for the year. Those are my comments, and I'll now turn it over back to Matt. Thank you, Tom.

Matt: Is higher than our previous guidance and reflects recent anticipated improvements in underwriting income results. In addition to a greater impact from share repurchases than previously anticipated for the year. Those are my comments and I'll now turn it over back to Matt.

James Matthew Darden: Those are our comments, and we will now open the call up for questions. Our first question comes from Jenny Butler from J.P. Morgan. Please go ahead. I'm assuming that's you. But good morning.

Matt: Thank you Tom those are our comments and we will now open the call up for questions.

Speaker Change: Thank you Sir as a reminder to ask a question. Please signal by pressing star one.

Speaker Change: Find that your question has already been answered you may remove yourself from the queue by pressing star two and please make sure the mute function on your phone is switched off to allow your signal to reach.

Speaker Change: Equipment again star one to ask a question start to cancel your request.

Speaker Change: First question comes from Jenny Butler from Jpmorgan. Please go ahead.

Speaker Change: Okay.

Jenny Butler: So first, I had a question just on lapses. And if you look at first year lapses across the various divisions, they seem like they've increased a little bit in all of them. So wondering if that's just you consider that a normal aberration or is there something related to the economy and just inflation or any changes in sales or services, or service practices on your end that's driving that? DTC, you know, overall, first year lapses are in line with expectations, and overall lapses are in line with expectations.

Jenny Butler: I'm, assuming that's me but.

Jenny Butler: Hi, Good morning, So first I had a question just on lapses and if you look at first year lapses across.

Jenny Butler: The various divisions and it seemed like the increased a little bit in all of them. So I'm wondering if that's just you consider that normal aberration or is there.

Speaker Change: Is it something related to the economy, and just inflation or any changes in <unk>.

Speaker Change: Sales of our services service practices on urine, that's driving that.

Speaker Change: Yep. Thanks, Jamie Yeah, we're really pleased with what we're seeing with recent persistency.

Jamie: Particularly in face of the short seller reports and the continued impact of the general economic conditions.

Jamie: I think it really speaks highly and reaffirms the stability of our of our business and we believe speaks to the nature that the basic protection products that we offer to meet the needs for our customers as it relates to.

Jamie: First.

Jamie: First year lapses.

Jamie: First up.

Speaker Change: It's up just a little bit over.

Speaker Change: Over the prior quarter and so.

Speaker Change: It really is in line with our 10 year average as well so I think it really is just a fluctuation.

Jamie: And then.

Jamie: DTC overall for sure lapses are aligned with expect overall lapses are aligned with expectations.

Speaker Change: First of all lapses were up a little bit over prior quarter, but just slightly higher than Q2, 23 and that could be related to sourcing. So we just see a little bit higher lapses on internet sales of Internet sales are a little bit higher so that may be driving some of that experience as well.

Jamie: And on LNG virtual lapses that are really consistent with last quarter. So again, we think a fairly good result from our lapsed perspective.

Jamie: For the business.

Jamie: No.

Speaker Change: And then you had a couple of items below the line that affected our net income I think one of them was related to M&A and I'm assuming that's.

Speaker Change: And expense that should not continue but the legal expenses.

Speaker Change: Those were really cash expenses versus maybe a reserve and then what are your thoughts about how those numbers there'll be as you go through this year and the likely impact of that on free cash flow next year.

Speaker Change: Yes.

Speaker Change: Legal expenses are related to expenses, we've incurred related to the Wilmerhale investigation and the short seller investigating the short seller allegations.

Speaker Change: We would expect some of those to continue a little bit for the rest of the year as we continue to work through those issues.

Speaker Change: And then on the M&A expenses the other expenses there.

Speaker Change: Hard to predict but but at this point I don't see any of those expenses continuing unless another opportunity emerge that we would.

Speaker Change: We would pursue.

Speaker Change: Yes, Jimmy I would just add that I would think that they would continue to be.

Jimmy: Material, if you will it have any kind of a material impact on our.

Jimmy: Your excess cash flows as we're thinking about it from next year's perspective or even on the remainder of this year.

Jenny Butler: And then if I could just ask one more question on the accelerated buybacks and the related financing, are you thinking about pulling forward the activity that you normally would have done next year into the second half? Or do you think that you have some debt capacity and you can, assuming no major changes in the stock price, do those, and then next year you get back to your normal schedule? Adding 400 million of additional debt.

Speaker Change: And then if I could just ask one more on the accelerated buybacks and the related financing how are you thinking about pulling forward. The activity that you normally would have done next year into the second half or you think that you have some debt capacity and you can.

Speaker Change: Assuming no major changes in the stock price do those but then next year, you'll get back to your normal schedule.

Speaker Change: Exactly I think we have some debt capacity I think we feel like we have some room to to finance and.

Speaker Change: Adding $400 million of.

Speaker Change: Additional debt.

R.: We'll bring R. R.

Unknown Executive: The Projected Debt Cap Ratio is kind of closer to 25%, and we really kind of like to operate in that 23 to 27, so it's well within the range of our debt capacity. Our next question comes from Wes Carmichael from Autonomous Research. Hey, good morning, and thanks for taking my question. I just had one follow-up on Jimmy's last question. But do you have any idea about the form of, you know, whether that's senior notes or commercial paper that you want to use for the financing to finance that accelerated buyback? We haven't decided on the final form, but my preference would probably lead a little bit towards longer-term debt, but it does depend a little bit on the rates that are available in the market?

R.: Projected debt cap ratios kind of closer to the 25% and we really kind of like to operate in that 23 to 27, So it's well within the range of our of our debt capacity.

Jimmy: Yes, Jimmy.

Speaker Change: I would just add that as we.

R.: Yes.

You'll continue to take a look at that.

R.: Tom said I think we've got added we've got adequate capacity there to be kind of where our normal historical range of the bed.

But of course, we're also taking a look at just sand are there some opportunities around capital management to free up some excess capital within the insurance operations, whether that'd be through reinsurance or other means and just continuing to look at that as well.

Speaker Change: Okay. Thank you.

Speaker Change: Our next our next question comes from Wes Carmichael from Autonomous Research. Please go ahead Sir.

Wesley Collin Carmichael: Hey, good morning, and thanks for taking my question I just had one follow up on Jimmy last one but do you have any idea about the foremost whether that's senior notes or commercial paper that you want to use for the financing to finance the accelerated buyback.

Unknown Executive: We haven't decided on the final form, but my preference is probably to lead a little bit towards long term death. It doesn't depend on a little bit on the rates that are available in the market, so we'll look at all of our options and select what we think is best for us. Got to thanks, that's helpful.

Speaker Change: We haven't decided on the final form, but my preference would probably lead a little bit towards longer term debt that doesn't depend on a little bit on the rates that are available to market. So we will look at all of our offer all of our options and select what we think is best for us.

Unknown Executive: So we'll look at all of our options and select what we think is best for us. As we had mentioned, the review also included processes for preventing, identifying, and responding to misconduct. We have been and always do look at our processes and procedures and controls and have a process in place for continuing to evaluate those and enhance them as necessary. So that won't be any different in the future as we think about what has come out of the review as well as just our normal processes for implementing improvements.

Speaker Change: Got it. Thanks, that's helpful and just regarding the audit committees investigation, you disclosed that theres no need to restate financials or disclosures, but is there any sort of broader review that's going on regarding some of the short seller allegations, especially around agent behavior at American income or do you not really expect any kind of material organizational changes.

Unknown Executive: And just regarding the audit committee's investigation, you disclose that there's no need to restate financials or disclosures, but is there any sort of broader review that's going on regarding, you know, some of these short-seller allegations, especially around, you know, agent behavior, American Income, or do you not really expect any kind of material organizational change? As we've mentioned, the review also included processes for preventing, identifying, and responding to misconduct. We have been and always do look at our processes and procedures and controls, and have a process in place for continuing to evaluate those and enhance them as necessary.

Speaker Change: As we had mentioned the review also included processes for preventing identifying and responding to misconduct.

Speaker Change: We have been and always do look at our processes and procedures and controls and have a process in place for continuing to evaluate those and enhance them as necessary. So that would be no different in the future as we think about.

Unknown Executive: So that'd be no different in the future as we think about what has come out of the review, as well as just our normal processes for implementing, you know, improvements. As we said, we believe we have the appropriate procedures in place to identify activity that's inappropriate or not in line with our core principles, and we take appropriate action as necessary.

Speaker Change: What has come out of the review as well as just our normal processes for <unk>.

Speaker Change: Implementing improvements as we said we believe we have the appropriate procedures in place to identify.

Unknown Executive: As we said, we believe we have the appropriate procedures in place to identify activity that's inappropriate or not in line with our core principles, and we take appropriate action as necessary. The only thing I would add to that, Wes, is that we really do think of this as just kind of part of our overall third-party risk management processes. And, you know, part of that is evaluating, you know, the changing risks in that environment and how that changes from time to time. And so, as Matt said, we'll always continue to strive for improvement, and we'll continue to do so through the use of additional share repurchases. I appreciate the answers.

Speaker Change: Activity, that's inappropriate and not in line with our core principles and we take appropriate action as necessary.

Unknown Executive: The one thing I would add to that was, is that, you know, we really do think of this, just kind of part of our overall third party risk management processes. And, you know, so part of that is evaluating, you know, the changing risks in that environment and how that changes from time to time. And so, as Matt said, we'll, you know, always continuing to strive for improvement, we'll continue to, you know, to look for, you know, ways to enhance what we're currently doing.

Speaker Change: One thing I would add to that west is that we really do think of this as just kind of part of our overall third party risk management processes.

Speaker Change: Part of that is evaluating the changing risks in that environment and how that changes from time to time so.

Speaker Change: As Matt said, we'll always continuing to strive for improvement and will continue to.

Matt: You have to look for ways to enhance what we're currently doing.

Unknown Executive: Thank you, and we will now take our next question from John County from Bifers and Ler. Please go ahead.

Thank you and we will now take our next question from John counting it from Piper Sandler. Please go ahead.

Unknown Executive: Good morning, thank you very much for the opportunity.

John: Good morning, Thank you very much for the opportunity.

Suneet Kamath: My first question on June 13th, I think you followed a K about a text issue with an unauthorized access. Do you have an update on that at all with the status of that as please, thank you.

John: My first question on June.

John: On June 13th I think you filed an 8-K about.

John: The issue with an unauthorized access do you have an update on that at all what the status of that is please thank you.

Unknown Executive: Yeah, so with, you know, as we noted in the AK that we did initiate a review of potential vulnerabilities, you know, regarding some access permissions and user identity management, you know, for a company web portal. You know, that was following an inquire that we didn't receive from a state insurance regulator. We have addressed the vulnerabilities from that, and we have initiated a comprehensive investigation into the matter. You know, at this point, the investigation is still ongoing, and we have yet to determine, you know, the full scope, nature, and impact overall, but, you know, we do know that there has not been a material impact on the company's operations.

Speaker Change: Yes, so with the.

Speaker Change: As we've noted in the 8-K that we did initiate a review of potential vulnerabilities regarding some access permissions and user identity management.

Speaker Change: For a company web portal.

Speaker Change: And that was following an inquiry that we did receive from a state insurance regulators, we have addressed the vulnerabilities from that and we have initiated a comprehensive investigation into the matter.

Speaker Change: At this point the investigation is still ongoing and we have yet to determine the full scope nature and impact overall, but we do know that there has not been a material impact on the company's operations.

Unknown Executive: You know, so we really don't have any, you know, thank further discussion at this time, but what continue to provide any notable updates as they become built.

Speaker Change: So we really don't have any further.

Further to disclose at this time, but we will continue to provide any notable updates as they become available.

Unknown Executive: Law. Thank you for that.

Speaker Change: Thank you for that my other question.

Unknown Executive: My other question.

Unknown Executive: I believe at the end of April, there was a Sherry Purchis authorization. It's good through the end of 25, 1.3 billion from my math that would possibly imply a greater amount of buyback in 25 than the normal runway would imply.

Speaker Change: Aleve at the end of April there was a share repurchase authorization.

Speaker Change: It is good through the end.

Speaker Change: 20 513 billion.

Speaker Change: On my math that would possibly imply a greater amount of buybacks.

Speaker Change: And 25 in the normal run rate would imply can you talk about the optionality to bring 426 cash flows. Thank you.

Unknown Executive: Can you talk about the optionality of bringing forward 26 cash flows?

Unknown Executive: Thank you. Yeah, I think that was really consistent with my comments of raising additional financing in the second half of the year to, for the use of additional Sherry Purchis's. And then we would have our normal access cash flows in 2025, which should get us fairly close.

Speaker Change: Yes, I think that was really consistent with my comment of raising additional financing in the second half of the year too.

Speaker Change: For the use of additional share repurchases.

Speaker Change: And then we would have our normal excess cash flows in 2025, which should get us fairly close and yes. I think Frank had mentioned is we are looking at other options too.

Unknown Executive: And you have to think, Frank, and mentioned, as we are looking at other options to raise additional capital from our insurance operations through reinsurance and other means, so that would be another potential source that would allow us to purchase some additional shares in either 24 or 25. One thing I, you know, it's still preliminary.

Frank: Raise additional capital from our insurance operations through reinsurance and other means so that would be another potential source that would allow us to.

Frank: Purchased some additional shares in either 'twenty four 'twenty five.

Speaker Change: I think the one thing I'll add to that.

Speaker Change: Preliminary and we'll talk about it more on the next call as far as our expectations of excess cash flows.

Unknown Executive: We'll talk about it more on the next call as far as our expectations of excess cash flows. You know, for what would kind of normally that we would expect for 2025, you know, right now, just kind of preliminary, we do see them being at a higher level than what we have here available in 2024, so we do think there's, you know, some additional capacity there. Again, we'll talk about that, you know, more on the next call, and I think the only other thing I'd point out is that it was clear that it was an authorization, you know, it's not a mandate, you know, so we're not, you know, we'll take a look at what's there and, and, you know, seek to, you know, buy back as many shares as long as it's pretty for us to do so.

Speaker Change: For what would kind of Norway that we would expect for 2025.

Speaker Change: Right now just kind of preliminarily, we do see them being at a higher level than what we have here available in 2024. So we do think there is.

Speaker Change: Some additional capacity there again, we'll talk about that more on the next call. It I think the only other thing I'd point out is that it was clear that it was.

Speaker Change: Authorization.

Speaker Change: Not a mandate so we're not.

Speaker Change: We'll take a look at what's there and.

Speaker Change: <unk> two.

Speaker Change: Buyback as many shares of bonds, it's prudent for us to do so.

I appreciate the answers thank you.

Unknown Executive: Appreciate the answers. Thank you.

Unknown Executive: Thank you. Thank you. We will now move to our next question from Suneet Kamath from Jefferies. Please go ahead.

Kamath: Thank you, we'll now move to our next question from <unk> Kamath from Jefferies. Please go ahead.

Elyse Greenspan: Well, now we'll tell our next question from Sunit. Come on from Jefferies.

Elyse Beth Greenspan: Please go ahead. Yeah, thanks.

Kamath: Yeah. Thanks, just wanted to start with the audit Committee review.

Elyse Greenspan: Just wanted to start with the audit committee review. So I just want to make sure I understand. So is it that they went through the review and really did not identify anything that you guys need to do better in terms of monitoring your sales practices? And it's just business as usual, given the considering the fact that you'd already said that, you know, you look at this stuff on a non-going basis, but there really wasn't anything incremental that you need to do.

Kamath: I just want to make sure I understand so is it that they went through the review and really did not identify any things that you guys need to do better in terms of monitoring your sales practices and it's just business as usual.

Given that considering the fact that you had already said that you look at this stuff on an ongoing basis, but there really wasn't anything incremental that you need to do.

Unknown Executive: Well, as we've mentioned, the independent review focused on the financial allegations and the raised questions about the financial statements and disclosures. Also, it did examine just our company processes for preventing, identifying, and responding to misconduct.

Suneet Laxman L. Kamath: Well, as we had mentioned, the independent review focused on the financial allegations, and it raised questions about the financial statements and disclosures. Also, it did examine just our company processes for preventing, identifying, and responding to misconduct. So I'll go back to what I said earlier in that we always continue to look for areas that we need to enhance. We continually enhance internal controls around a variety of things, including our sales practices.

Speaker Change: Well as we had mentioned the independent review focused on the financial allegations raised questions about the financial statements and disclosures.

Speaker Change: Also it did examine just our company processes for preventing identifying and responding to misconduct. So I'll go back to what I said earlier and that we are ways continue to lift too are there areas that we need to enhance we continually enhanced internal controls around.

Unknown Executive: So I'll go back to what I said earlier in that we always continue to look to other areas that we need to enhance. We continually enhance internal controls around a variety of things, including our sales practices. We always look at our processes and procedures for identifying misconduct and addressing those as appropriate. And so we will continue to do so as far as evaluating those and continuing to enhance those as appropriate.

Speaker Change: Round, a variety of things, including our sales practices, we always look at our processes and procedures for identifying.

Suneet Laxman L. Kamath: We always look at our processes and procedures for identifying misconduct and addressing those as appropriate, and so we will continue to do so as far as evaluating those and continuing to enhance those as appropriate. You know, if there's nothing to talk about, they just sort of don't like it, there's no finality to it.

Speaker Change: This conduct in addressing those as appropriate and so we will continue to do so as far as evaluating those and continuing to enhance those as in as appropriate.

Unknown Executive: And then just sort of relatedly on the DOJ and the SEC, are those reviews that ultimately will figure, you know, will hear something about how what the conclusions are, or is this just, you know, if there's nothing to talk about that they just sort of doesn't, there's like there's no finality to it. I'm just trying to figure out from a timing perspective how we should be thinking about these reviews. Sure, our intent would be to update you as the material developments happen in both of those cases.

Speaker Change: Got it and then just sort of Relatedly on the D O J M.

Speaker Change: FCC.

Speaker Change: Are those reviews that ultimately will figure we will hear something about how what the conclusions are or is this just.

Unknown Executive: I'm just trying to figure out, from a timing perspective, how we should be thinking about these reviews. Sure, our intent would be to update you as material developments happen in both of those cases. You did your assumption review in Q3, and you'll do another one in Q3 of this year, but the re-measurement gains in the fourth quarter and the second quarter, the fourth quarter of last year, and the second quarter of this year, were quite big.

Speaker Change: If there is nothing to talk about just sort of doesn't like Theres no finality to it I'm just trying to figure out from a timing perspective, how we should be thinking about these reviews.

Speaker Change: Sure our intent would be to update you as the material developments happening in both of those cases.

Elyse Greenspan: Okay, and then the last one I had was just on the re-measurement, just so I understand what's going on here. Because it looked like you did your assumption review in Q3, you'll do another one in Q3 of this year. But the re-measurement gains in the fourth quarter and the second quarter, fourth quarter of last year, second quarter of this, are quite big. I mean, assuming that's just seemingly suggest that you could have another favorable assumption review here in the third quarter, or are these re-measurement gains really reflecting some of the assumption changes that you did last year?

Speaker Change: Okay and then the last one I had was just on the re measurement.

Speaker Change: I understand what's going on here because it looked like you did your assumption review in Q3.

Speaker Change: You'll do another one in Q3 of this year, but the re measurement gains in the fourth quarter and the second quarter fourth quarter of last year's second quarter. This year were quite big.

Unknown Executive: I mean, I'm assuming that to seemingly suggest that you could have another favorable assumption review here in the third quarter, or are these re-measurement gains really reflecting some of the assumption changes that you did last year? The re-measurement gains that we report in the quarter are relative to the assumption. Thank you. Our next question comes from Elyse Greenspan from Wells Fargo. Please go ahead.

Speaker Change: I'm, assuming that seemingly suggest that you could have another favorable assumption review here in the third quarter or are these re measurement gains really reflecting some of the assumption changes that you did last year.

Unknown Executive: The re-measurement gains that were reported in the quarter are relative to the assumptions, our current assumptions for determining reserves, which were established in the third quarter of 2023. So, in essence, I'd say yes, there. We have seen some re-measurement gains throughout the year on the life business and the health business, and so those are indicative of mortality trends that appear to be favorable relative to those evaluation assumptions and relative to the endemic assumption that we established back in Q3 of 2023.

The re measurement gains that we reported in the quarter or relative to the assumptions.

Speaker Change: Our current assumptions.

Speaker Change: For determining reserves, which were established in the third quarter of 2023, so in essence, I'd say, let's say, yes there.

Speaker Change: We have seen some re measurement gains throughout the year on the life business.

Speaker Change: And the health business and so those are indicative of of mortality trends appear to be favorable relative to those valuation assumptions and relative to today's xebec assumption that we established back in Q3 of 2023. So that's what we're looking at right now and evaluating just our.

Unknown Executive: So that's what we're looking at right now with evaluating just our base mortality assumptions as well as what do we think is an appropriate assumption long term for the endemic or short term for the endemic. And so that's what we're finalizing in Q3, which will result in an update to those assumptions. We do give in the recent experience, we do anticipate that will be a favorable re-measurement gain on the life business and had the reason for Frank increasing the range of our pulse or underwriting margins to 39 to 41. So we do think that those will move up a little bit.

Speaker Change: Our base mortality assumptions as well as.

Speaker Change: What do we think is an appropriate assumption long term for the endemic or short term for the <unk>.

And so that's what we're finalizing in Q3, which will result in an update to those assumptions.

Speaker Change: We do given the recent experience we do anticipate that will be a favorable re measurement gain on the life business and hence the reason for Frank increasing the range of our pulse our underwriting margins to 39% to 41, So we do think that that.

Speaker Change: Those will move up a little bit.

Elyse Greenspan: If that's just the last one on that.

Speaker Change: Hopefully that helps.

Speaker Change: It does just the last one on that so just to be clear is that embedded in your new EPS guidance or this would be incremental to the EPS guidance now it's embedded in our guidance range and what we've tried to we've tried to reflect what we anticipate in the midpoint of that range as well.

Unknown Executive: So just to be clear, is that embedded in your new EPS guidance, or this would be incremental to the EPS guide? No, it's embedded in our guidance range, and what we've tried to reflect what we anticipate in the midpoint of that range as well. Got it.

Speaker Change: Got it okay. Thank you very much.

Unknown Executive: Okay, thank you very much. Thank you.

Speaker Change: Thank you our next question comes from.

Elyse Greenspan: Our next question comes from a green span from Wells Fargo. Please go ahead. Hi, thanks.

Speaker Change: Greenspan from Wells Fargo. Please go ahead.

Greenspan: Hi, Thanks. Good morning, My first question in response to some earlier questions you guys mentioned looking into potential reinsurance as a way to free up capital can you just expand on what you guys might consider and then it sounds like this could perhaps be either 'twenty four 'twenty five of that do you have a sense of.

Elyse Greenspan: Good morning. My first question, in response to some earlier questions, you guys mentioned looking into potential re-insurance as a way to free up capital. Can you just expand on, you know, what you guys might consider.

Unknown Executive: And then it sounds like this could perhaps be either 24 or 25 event.

Unknown Executive: Do you have a sense of, you know, any comments on potential time frame as well.

Speaker Change: Any comments on potential timeframe as well.

Speaker Change: Yeah, I can work continually evaluate.

Elyse Beth Greenspan: Yeah, I know we're continuing to evaluate reinsurance opportunities, and you know we have a financial reinsurance program in place right now, so we're just looking at whether it makes sense to expand that program a little bit. In addition, you know that we think there's an opportunity to manage overall capital and an economic framework like is available in Bermuda, so we're evaluating that option and what that might look like. That's probably a little bit longer term as far as capital management is concerned, but we think that there's some promise in that solution.

Speaker Change: Reinsurance opportunities.

Speaker Change: We have a financial reinsurance program in place right now so we're just looking at whether it makes sense to expand.

Speaker Change: That program a little bit.

Speaker Change: In addition to that.

Speaker Change: There's we think there's opportunity to manage overall capital.

Speaker Change: And in an economic framework like is available and in Bermuda. So we're evaluating.

Speaker Change: That option and what that might look like that's probably a little bit longer term as far as capital management approach, but we.

Speaker Change: And we think that Theres some promise in.

Speaker Change: In that solution, yes, the only thing I would add I mean, there are a few.

Speaker Change: Lots of business that we are evaluating.

Speaker Change: To see does that make does it make any sense.

Speaker Change: For us.

Speaker Change: And our shareholders to.

Speaker Change: Dispose of those books of business, we don't have we've kind of talked about that in the fourth before that we don't have a lot of books that are.

Speaker Change: <unk>.

Speaker Change: Necessarily all books of business that are closed block and that type of thing so, but there's not necessarily a lot there but.

Elyse Beth Greenspan: Unknown Executive, Wesley Carmichael, Jian Huang, Globe Life, And then you guys give us a lot of color on capital. What were the subsidiary dividends in the quarter and embedded within your capital plans? What is the what's the new guidance for subdividends for the full year?

Speaker Change: I think that we're taking a look at.

Okay.

Speaker Change: And then you guys gave us a lot of color on capital what were the subsidiary dividends in the quarter and embedded within your capital plans what are the what's the the new guidance for sub dividends for the full year.

Speaker Change: The full year dividends from.

Speaker Change: The insurance subsidiaries is just over 460 million between $4 60 and $470 million.

Speaker Change: Haven't updated our guidance for what dividends will be to the parent in 2025, we will look at that.

Speaker Change: Later in the year one of the things that is it.

Unknown Executive: One of the things that is impacting, that will impact 2025 dividends favorably, is there are some Evaluation manual changes from the statutory accounting perspective that should be favorable to us, and we can give you an update on that next quarter as well. Thank you. Thank you. Thank you. We will now take our next question from Ryan Krueger from KDW. Please go ahead. Hey, thanks. Good morning.

Speaker Change: Is impacting that will impact 2025 dividends favorably as there are some.

Speaker Change: Evaluation manual changes from the statutory accounting perspective that should be favorable to us and we can give you an update on that next quarter as well.

Speaker Change: Thank you.

Speaker Change: Thank you. Thank you we will now take our next question from Ryan Krueger from K D. W. <unk>. Please go ahead.

Ryan Joel Krueger: A follow-up on the Wilmer Hale investigation, I guess. Did they investigate actual agent misconduct at all, or was it really just predominantly focused on your own company's procedures to manage agent behavior? It looked at the company's processes for preventing, identifying, and responding to misconduct, and the audit committee did review and confirm that the company has policies and procedures in place designed to safeguard the work experience for the agents. As we've mentioned before, we are confident in our controls around identifying agent behavior along with our processes for investigating issues that we've become aware of and remediating those as necessary and taking the appropriate action.

Ryan Joel Krueger: Hey, Thanks, good morning.

Speaker Change: Follow up on the Wilmar Hale.

Investigation I guess.

Ryan Joel Krueger: Did they did they investigate actual agent misconduct at all or is it really just predominantly focused on your own company's procedures to <unk>.

Speaker Change: To kind of manage agent agent behavior.

Speaker Change: Yes.

Speaker Change: <unk> looked at the companies' processes for preventing identifying and responding to misconduct.

Speaker Change: Audit Committee did review and confirm that the company has policies and procedures in place.

Speaker Change: Designed to safeguard the work experience for the agents.

Speaker Change: As we've mentioned before we are confident in our controls around identifying agent behavior, along with our processes for investigating issues that we've kind of aware of and remediated those as necessary and taken the appropriate action.

Ryan Joel Krueger: Ryan They also.

Ryan Joel Krueger: I'd noted before.

Ryan Joel Krueger: They looked at all of the allegations that might have at the kind of question. If you will the accuracy or integrity of our financial statements and disclosures so to the extent that they're worth agent behaviors that would have impacted.

Ryan Joel Krueger: Our financial statements our disclosures I will just say for instance sales activities.

Ryan Joel Krueger: Just say, for instance, sales activities; those allegations would have been, you know, looked into and seen whether or not there was, you know, any reasons for any restatements of any of our, you know, previously issued financial reports or disclosures. And as we noted before, they did, you know, did determine that no restatements were necessary, which includes... Okay. Got it.

Speaker Change: Those allegations would've been.

Speaker Change: <unk> looked into it and seeing whether or not there was.

Speaker Change: Any reasons for any restatements of any of our.

Speaker Change: Previously issued financial reports, our disclosures and as we noted before they did.

Speaker Change: Did determine that no restatements.

Speaker Change: Where necessary.

Speaker Change: Which includes understood.

Unknown Executive: I mean, I guess just one more on this specific topic. So, you know, if, in the future, for example, with the DOJ investigation into some of the specific agents, if they do, you know, ultimately determine there was misconduct, like, do you see that as something that is a liability to you as a company, given that they're independent contractors or because of that distinction? Do you view that almost as, you know, a separate issue?

Speaker Change: Got it and I guess, just one more on the specific topics.

Speaker Change: In the future for example, with the Doj investigation into some of the specific agents if they do ultimately determine there was misconduct.

Speaker Change: Do you see that as something that is <unk>.

Speaker Change: Liability to you has the company given that they are independent contractors or.

Because of that distinction do you view that almost at that.

Speaker Change: Separate issue.

Speaker Change: I think really as we evaluate that and look it looks like currently as we said in our statement earlier. They are reviewing the sales Act.

Unknown Executive: I think, you know, as we evaluate that, it looks like currently, as we've said in our statement earlier, they're reviewing the sales activity of just certain agents that were in the area's organization. And if there's a significant update to that from a scope perspective, we'd be sure to disclose and update that. But right now, that is the focus of the inquiries so far. Thanks.

Speaker Change: Activity or just certain agents that were in the areas organization and if theres a significant update to that from a scope perspective, we'd be sure to disclose and update that but right now that is the focus of the.

Speaker Change: Inquiries so far.

Unknown Executive: And then just one separate question on free cash flow. You mentioned a few things that sound like it could be positive next year. I think previously you had talked about looking at ways to get the free cash flow conversion higher, and I think you had mentioned the possibility of getting it up to 60 percent, at least over time. Can you just give an update on that? And, you know, do you expect to make, you know, at least part, I guess, progress towards the 60 percent in 25? Or is that something that would occur over the longer term?

Speaker Change: Thanks, and then just one separate question on free cash flow you had mentioned a few things it sounds like that could be positive next year.

Speaker Change: I think previously you had talked about looking at ways.

Speaker Change: Get the free cash flow conversion higher and I think you had mentioned.

Speaker Change: The possibility of getting that up to 60% at least over time.

Speaker Change: Can you just give an update on that.

Speaker Change: Do you expect to make at least part.

Speaker Change: Progress towards the 60% and 25 or is that something that would create longer term.

Speaker Change: Okay.

Unknown Executive: It's definitely over the longer term. The things that I talked about actually will, I think, be additive and actually kind of aligned with getting to that 60%, so it continues to be something that we're striving towards and looking at opportunities to do, and that's where I think... Effective use of the Bermuda Regulatory Environment could actually really help support getting to the higher end, higher cost conversion ratio.

Speaker Change: Yes, it's definitely over the longer term.

Speaker Change: Things that I talked about actually will will I think be.

Speaker Change: The additives and actually.

Speaker Change: Kind of are aligned with getting to that 60%. So it continues to be.

Something that we're striving towards and looking at opportunities to do them and Thats, where I think.

Speaker Change: Use more.

Speaker Change: Effective use of.

Speaker Change: Bermuda regulatory environment could actually really help support getting to the higher.

Speaker Change: The higher <unk>.

Speaker Change: Customers ratio, yes, and some of those as.

Unknown Executive: So, and some of those, as we've taken a look at it, I think there are some near-term items that I do think some of our optimism with respect to 2025 free cash flows stems from strong sales, which is following converting into strong premium growth in 2024, and then the favorable, you know, some of the favorable claims experience that we're seeing, especially on the life side, will help with the statutory income in 2024 as well So that gives us some optimism that we may have some expanded... you at www.globalonenessproject.org. Okay, great. Thanks a lot.

Speaker Change: As we've taken a look into it I think there are some near term items that I do think some of our optimism with respect to 2025 free cash flows stems from strong sales which is following.

Speaker Change: Converting into strong premium growth in 2024, and then the favorable.

Speaker Change: Some of the favorable claims experience that we're seeing especially on the life side.

Speaker Change: Hope with the statutory income in 2024 as well so that gives us some optimism that we may have some expanded.

Tom: Excess cash flows in 2025 gig Tom drawing on some of those where it's <unk>.

Speaker Change: Changing the nature of the free of.

Tom: The conversion ratio some of that by a tail into 'twenty, five which may not.

Tom: Materializing it took by 2026 as far as additional dividends and some of that even though we will take a look obviously at sea.

Tom: What is what we can do from a timing perspective.

Speaker Change: Okay, great. Thanks, a lot.

Wilma Carter Jackson Burdis: Thank you. We will now take our next question from Wilma Burden from Raymond James. Please go ahead. Hey, good morning.

Speaker Change: Thank you, we'll now take our next question from Guillaume burden from Raymond James. Please go ahead.

Unknown Executive: Would a positive, a very positive 3Q24 review possibly imply higher free cash flow? I think you guys have talked about how the remeasurement needs are very favorable. Thanks. [inaudible] The remeasurement gains and losses are gapped, so what drives free cash flow is statutory earnings.

Guillaume burden: Hey, good morning.

Guillaume burden: What our partners are.

A very positive reaching 24 review, possibly imply higher free cash flow I think you guys have talked about how the re measurement gains are very favorable.

Yes.

Speaker Change: So we'll not.

Speaker Change: The re measurement gains or losses are GAAP, so what drives the free cash cash flow is statutory earnings power.

Unknown Executive: However, as we've mentioned in the past, or I've mentioned in the past... When we see a remeasurement gain relative to our assumptions in GAP, That's about 25% of what the..., that the delta is from our assumptions comes through. And so the full impact of the assumptions, the differences between assumptions. A good majority of that's going to be coming through in statutory. So that's one of the reasons why we think that we'll have improved statutory earnings in 2024, which will then lead to increased. Dividends from the subsidiary to the parent in 2025 and higher excess cash flows.

Speaker Change: However.

Speaker Change #100: As we've kind of as we've mentioned in the past or I've mentioned in the past is when we see a remeasurement gain relative to our assumptions in gap.

Speaker Change #100: That's about 25% of what the.

Speaker Change #100: But the Delta is from our assumptions comes through and so the full impact of assumption the differences between assumptions.

Speaker Change #100: A good majority of that is going to be coming through and statutory. So that's one of the reasons why we think that will have.

Speaker Change #100: Improve statutory earnings in 2024 that will then lead to increased.

Dividends from the subsidiary to the parent in 2025 and higher excess cash flows. So that's part of it. The other thing that I mentioned is the changes in the valuation manual.

Unknown Executive: So that's part of it. The other thing that I mentioned is the change in the valuation manual that was implemented in 2024, which I think will also result in higher statutory earnings and actually could also increase excess cash flows or dividends to the parent in 2025 from the subs, resulting in higher excess cash flows. I can just follow up on that one. Is there any additional color you could provide with the valuation manual?

Speaker Change #100: That's been implemented in 2024, I think we'll all.

Speaker Change #100: So.

Speaker Change #100: Resulted higher statutory earnings it actually could also increase of excess cash flows.

Speaker Change #100: Dividends to the parent in 2025 from a subs and resulting in higher excess cash flow.

Speaker Change #101: Thanks, and just a quick follow up on that one is there any additional color you could provide on what the valuation manual chain.

Unknown Executive: Change Relates To. It relates to, to, um... The Aggregation of Mortality Assumptions Related to Determining Principle-Based Reserves The change allows, it adds some clarity around what level of aggregation you can use. And so, by being able to aggregate larger blocks, there's an opportunity to... This is an opportunity to... use a more favorable mortality assumption in the evaluation of the reserve. This is a really broad question, but do you think there's anything else you can do to mitigate the DOJ SEC overhang?

Speaker Change #102: Change relates to.

Speaker Change #103: It relates to two.

Speaker Change #104: The aggregation of mortality assumptions related to determining principle based reserves is.

Speaker Change #105: The change allows it add some clarity around what level of aggregation you can use and so by being able to aggregate larger blocks as an opportunity to.

Speaker Change #106: This is an opportunity to.

Speaker Change #106: Use a more favorable mortality assumption in the evaluation of the reserve.

Linda: This is a really broad Linda.

Linda: Anything else you can do to mitigate the Doj.

Okay.

Unknown Executive: Unfortunately, that's an independent process outside of our control, so what we are doing is fully cooperating in both instances, as well as providing any additional information or response to inquiries that we get as quickly as possible. Our desire, of course, is to have those processes progress forward as quickly as possible, and the best thing we can do is just be very responsive as we work through those processes. We will now take our next question from Tom Gallagher from Evercore. Please go ahead. This morning,

Speaker Change #108: Unfortunately, thats, an independent process outside of our control so.

Speaker Change #109: What we are doing is full.

Speaker Change #109: Fully cooperating in both instances as well as providing.

Speaker Change #109: Any additional information in response to inquiries that we get as quickly as possible. So our desire of course is to have those progressed forward as quickly as possible and the best thing. We can do is just be very responsive as we work through those processes.

Speaker Change #109: Thank you.

Thomas Gallagher: And we're going to take our next question from Tom Gallagher from Evercore. Please go ahead.

Speaker Change #109: We will now take our next question from Tom Gallagher from Evercore. Please go ahead.

Thomas George Gallagher: Good morning.

Thomas George Gallagher: Morning.

Thomas George Gallagher: Just on the American income side, have there been any changes in senior management or sales managers as a result of your review? It sounds fairly narrow in scope based on the way I've heard it described, focusing on certain agents. But have there been any changes on the management side, or have there been any agents that have been let go as a result of this? So, you had several questions there; let me see if I can address them. Regarding the scope being narrow, the narrowness was related to the DOJ investigation focused on specific agents within the ARIES organization.

Thomas George Gallagher: Just on the American income side any have there been any changes in senior management or sales managers.

Unknown Executive: Just on the American income side, have there been any changes in senior management or sales managers as a result of your review? It sounds fairly narrow in scope based on the way I've heard it described, focusing on certain agents. But has there been any changes on the management side, or have there been any agents that have been let go as a result of this?

Speaker Change #111: As a result of your review it sounds fairly narrow in scope based on.

Speaker Change #112: The way I've heard it described focusing on certain agents.

Speaker Change #113: Has there been any changes on the management side.

Speaker Change #113: Or have there been any agents that have been what go as a result of this.

Speaker Change #113: And so yes.

Unknown Executive: So, yeah, several questions there. Let me see if I can address some regarding the scope being narrow. The narrowness was related to the DOJ investigation focused on specific agents within the area's organization. As far as evaluation of the assertions and allegations in the short-selling report, that covered very broad from all of our financial items that were pointed out as well as just our overall processes and systems for controls. And I think what we've noted in the past is some of the agents that have shown up in some of the articles are terminated agents that are not here any longer.

Speaker Change #114: Several questions here, let me see if I can address them regarding the scope being narrow the narrowness was it related to the Doj investigation.

Speaker Change #114: <unk> focused on specific agents within the areas organization.

Speaker Change #114: As far as evaluation of the assertions.

Unknown Executive: As far as the evaluation of the assertions and allegations in the short-selling report, you know, that covered very broadly from all of our financial items that were pointed out as well as just our overall processes and systems for controls. And I think, as we've noted in the past, some of the agents that have shown up in some of the articles are terminated agents. They are not here any longer, and that happened long before the investigation by the audit committee started.

Speaker Change #114: And allegations in the short selling report that covered.

Speaker Change #114: Very broad from all of our financial.

Speaker Change #114: Items that were pointed out as well as just our overall processes and systems for controls and I think of as we've noted in the past as some of the agents that have shown up in some of the.

Speaker Change #114: Articles are terminated agents that you are not here any longer than that happen long before investigation.

Unknown Executive: And that happened long before the investigation by the audit committee started. So I'll just go back to my statement earlier is that we do take appropriate action related to, you know, Ms. Conduct as well as I think I've mentioned on our last call is that some of the assertions by the short sellers were based on a, as an executive on the sales management side within American Income that we terminated for costs. And so we do take appropriate action. We take these things seriously, and we are confident in our processes and controls. And as I mentioned, we always continue to enhance that, but it was a pretty broad and wide-ranging review, and the results of that that we've discussed today.

Speaker Change #114: The audit Committee started so I'll just go back to my statement earlier that we do taken appropriate action.

Unknown Executive: So, I'll just go back to my statement earlier that we do take appropriate action related to, you know, misconduct as well as I think I mentioned on our last call that some of the assertions by the short-sellers were based on an executive on the sales management side within American Income that we had terminated for cause. And so we do take appropriate action. We take these things seriously, and we are confident in our processes and controls.

Speaker Change #114: Related to <unk>.

Suneet Laxman L. Kamath: MS Khan debt.

Suneet Laxman L. Kamath: As well as I think I had mentioned on our last call is that some of the assertions by the short sellers were based on a.

Suneet Laxman L. Kamath: As an executive.

Suneet Laxman L. Kamath: And the sales management side within American income that we had terminated for cause and so we do take appropriate action, we take these things seriously.

Suneet Laxman L. Kamath: And we are confident in our processes and controls and as I had mentioned, we always continue to enhance that but it is a.

Unknown Executive: And as I mentioned, we always continue to enhance that, but it was a pretty broad and wide-ranging review and the results of that that we've discussed today. But no, but no one that from the recent review that was done, no, you haven't made any, there's been no terminations of sales management or otherwise, as a result of that review. Is that is that a fair statement? That is not a fair statement, but I'm not at liberty to discuss things that are... Under litigation, trans, etc.

Suneet Laxman L. Kamath: Any broad and wide ranging.

Suneet Laxman L. Kamath: Review and the results of that and that we've discussed today.

Unknown Executive: But no, but no one that from the recent review that was done note you haven't made any, there's been no terminations of sales management or otherwise as a result of that review. Is that a fair statement?

Speaker Change #116: But note, but no one.

Speaker Change #117: From the recent review that was done no you Havent made any there's been no terminations of sales management or otherwise as a result of that review was that is that a fair statement.

Unknown Executive: That is not a fair statement, but I'm not at liberty to discuss things that are under litigation, trans, et cetera, as I've mentioned in my prepared calls. Gotcha, okay.

Speaker Change #118: That is not a fair statement, but I am not at Liberty to discuss things that are.

Unknown Executive: as I've mentioned in my prepared call. Gotcha. Okay. And then my follow-up, but just back on the remeasurement gains from mortality. So is mortality still somewhat adverse relative to pre-pandemic levels, or are we back to normal now? Or is it actually trending favorably? I realize that it's certainly favorable relative to the conservatism in your assumptions that were implemented as part of LDTI, but I just want to know where we are, like, are we all the way back now? Or is it still somewhat adverse?

Speaker Change #118: Under.

Speaker Change #118: Litigation trends et cetera, as I've mentioned in my prepared calls.

Speaker Change #118: Got you, Okay, and then Mike My follow up just back on the re measurement gains from mortality. So.

Elyse Greenspan: And then my follow but just back on the remasierment gains from mortality.

Unknown Executive: So, is mortality still somewhat adverse relative to pre-pandemic levels, or are we back to normal now, or is it actually trending favorable? I realize the, you know, it's certainly favorable relative to the conservatism in your assumptions that were implemented as part of LDTI. But I just want to know where we are. Like, we all the way back now, or is it still somewhat adverse? Yes, you know, we still see, you know, first of all, mortality has been fairly consistent over the last few quarters, which has been good. We are seeing, like she said, some improvements from where they were, the peak, but we also cause us that continue to be higher than where they, they were, you know, pre-COVID.

Speaker Change #119: Mortality is still somewhat adverse relative to pre pandemic levels.

Mike: Or are we back to normal now or is that actually trending favorable.

Speaker Change #121: I realize the.

Mike: It's certainly favorable relative to the conservatism in your assumptions that were implement that as part of LD Ti, but I just wanted to know where we are like are we all the way back now or is it still somewhat adverse.

Unknown Executive: You know, we still see, first of all, some improvements from where they were at the peak, but we also have causes that continue to be higher than where they were pre-COVID. And I would say heart disease and cancer, although improved, are still a little bit higher than where we were prior to 2019. And one that remains elevated as a cause of death is neurological disorders, which would be stroke and Alzheimer's.

Mike: Yes.

Speaker Change #122: We still see first of all mortality has been fairly consistent over the over the last few quarters, which is which has been good. We are seeing like you said some improvements from where they were at the peak but.

Speaker Change #123: Causes are continuing to be higher than where they were pre COVID-19 and I would say.

Unknown Executive: And I would say, it's hard to see the cancer, although improved, are still a little bit higher than where we were prior to 2019. And one that remains elevated is the cause of the death is, is neurological disorders, which would be stroke and Alzheimer's. So, we're keeping an eye on, on, on that.

Speaker Change #123: Heart disease and cancer, although improved are still a little bit higher than than than where we were prior to 2019.

Speaker Change #123: And one that remains elevated as causing the deficit is.

Speaker Change #123: Neurological disorders, which would be stroke at all timers. So we're keeping an eye on that.

Unknown Executive: And then I think another, like, a positive is, is non-medical deaths have improved. And those have improved, yes, those are actually, I'd say, more in line with historical, maybe just a little bit elevated from where they were. So, I think the trends are good, but we're not quite there yet.

Unknown Executive: So we're keeping an eye on that, and I think another positive is that non-medical deaths have improved. Those are actually, I'd say, more in line with historical, maybe just a little bit elevated from where they were.

Speaker Change #123: And then I think another like a positive as is nonmedical deaths are improved and.

Speaker Change #123: Those.

Speaker Change #124: Have improved yes, those are actually I'd say more in line with historical maybe just a little bit elevated from from where they were so I think the trends are good but we're not quite there yet.

Unknown Executive: So I think the trends are good, but we're not quite there yet. Gotcha. So stroke and Alzheimer's are where you still see some elevation.

Unknown Executive: Okay. All right. That's helpful.

Speaker Change #124: Got just a stroke in Alzheimer's Thats, where you still see somewhat elevation.

Speaker Change #125: Alright Thats helpful. Thank you.

Unknown Executive: Thank you. Thank you. And we have a follow-up question from Jimmy Bhullar from J.P. Morgan. Please go ahead. So, Tom, just on your comments on the stat valuation changes, can you sort of give us a rough range of the expected amount, single-digit millions, tens of millions, or higher than that, just so we have some idea? I realize you'll give out the exact details next quarter. Yeah, we'll give you the details, Jimmy, next quarter.

Jamie: Thank you and we have a follow up question from Jimmy <unk> from Jpmorgan. Please go ahead Jamie.

Jamie: So Dom just on your comments on the.

Jamie: The debt valuation changes.

Elyse Greenspan: Can you sort of give us a rough range of, are the expected amounts, single-digit millions, tens of millions, or higher than that, just so we have some idea, recognize you'll give out the exact details next quarter. Yep. We'll give you the details to be next quarter.

Jamie: Can you sort of give us a rough range.

Jamie: The expected amount of single digit millions tens of millions or higher than that just so we have some idea recognize you'll give out the exact.

Dom: Details next quarter.

Unknown Executive: We're still going through all of our work. So I wouldn't want to give you a good number, and we'll be looking to implement it. The fact that you mentioned it sort of would imply that it's more than just a handful of million dollars.

Dom: We will give you the details Jimmy next quarter, we're still.

Unknown Executive: We're still going through all of our work, so I wouldn't want to; I wouldn't actually give you a good number. And we'll be, look at the implement. But it is; the fact that you mentioned, it sort of would imply that it's more than just a handful of million dollars. Is that a correct assertion? That's fair to me. Yep.

Jimmy: Going through all of our work so I wouldn't want to.

Jimmy: Want to actually give you a good number and we'll be looking to implement it.

Jamminder Singh Bhullar: Is that a correct assertion? That's fair to me. Okay. We'll wait another three months.

Jimmy: The fact that you mentioned that sort of would imply that it's more than just a handful of million dollars, but is that a correct.

Speaker Change #127: Our assertion that SaaS.

David: Fair David.

Operator: Thank you. And thank you. And that's all the questions we have today.

Unknown Executive: Okay. We'll wait another three months. Thank you.

David: Okay.

Speaker Change #129: Another three months thank you.

David: Yes.

David: Yes.

Stephen Mota: And thank you, and that's all questions we have today.

Stephen Mota: With that, I'd like to hand the call back over to Stephen Mota for any additional or closing remarks. Alright, thank you for joining us this morning. Those are our comments. We will talk to you again next quarter. Thank you. This concludes today's conference call. Thank you for your participation, ladies and gentlemen.

Thank you and that's all questions. We have today with this I'd like to hand, the call back over to Stephen multi for any additional or closing remarks.

Stephen Mota: I would just like to hand the call back over to Stephen Motte for any additional work. All right.

Stephen Mota: Alright. Thank you for joining us. This morning, those are our comments, we will talk to you again next quarter.

Unknown Executive: Thank you for joining us this morning. Those are our comments. We'll talk to you again next quarter. Thank you.

Speaker Change #131: Thank you. This concludes today's conference call. Thank you for your participation ladies and gentlemen, you may now disconnect.

Unknown Executive: This concludes today's conference call. Thank you for your participation, ladies and gentlemen. You may now...