Globe Life (GL) 4 May 232023 Q1 Earnings call transcript

Hello and welcome to Globe Life's First [ph] Quarter 2022 Earnings Call. My name is Melissa and I will be your coordinator for today's event. Please note this conference is being recorded. And for the duration of the call your lines will be listen-only. [Operator Instructions]

the of to today's Customer hand Mota, host conference. now Director Senior Relations will call your over Stephen I to begin Thank you. begin. Stephen may you

Thank you. Good everyone. morning

Co-Chief Svoboda the Officer; Financial General our and Matt Joining Counsel. are Officer; Majors, Tom Frank Strategy Mitchell, today Darden, our call Mike our Brian Executive Chief Chief Officer; Kalmbach, and our

refer release general Some statements that forward-looking XXXX questions may guidance only. file SEC. of purposes contain with our earnings comments or answers to Accordingly, on XX-K please provided and your for our to the are

our Some reconciliations Please for to release may discussion of our website measures. comments measures. also contain and and GAAP see non-GAAP of terms these earnings

over Frank. the will turn I to now call

our XXXX for XXXX LDTI reported quarter of Thank the the XXXX reflects first results I Stephen you, good that morning the and and on guidance. new everyone. of January adoption accounting Xst, here would note

members technology fantastic to in accounting, new a in First, will the detail our quarter. It a and actuarial, I substantial ready new the discuss us Tom of more his getting was project and many they investment, adopt guidance comments. for this did thank to job. accounting want guidance this teams

year $XXX or year per net share, $X.XX per $X.XX $XXX the $X.XX or income increase was $XXX ago. million Net In compared for to an first X% operating income a was million ago. per quarter, million a from or share share the of quarter

ago. book reported share is on income $XX.XX, GAAP return value basis, equity or XX.X% share comprehensive and a XX% $XX.XX, was from is a On other per on per XX.X% year up equity book accumulated was and return excluding value AOCI,

year X% to for quarter increased ago million. premium the In Life from Operations, revenue quarter Insurance $XXX first the

was we year, X% million, up margin a $XXX X%. For to underwriting premium year around ago. expect from revenue Life grow the life

underwriting premium range to XX% to expect a be our midpoint margin we XX%. of life the At the in of as guidance, percent of

calls, rules. prior the under new underwriting margin is on LDTI we've accounting As discussed different

was In to $XXX million. premium to margin X% up grew underwriting health Health $XX Insurance, X% million and

expect around be the margin XX% we grow to the we percent premium to to expect range at year, midpoint For our XX%. health of the revenue guidance, health of underwriting in as of premium a X%

the expenses $XX from up X% were Administrative million for year quarter, ago. a

percentage a to X.X% administrative ago. a premium, As of expenses compared were X.X% year

expected administrative by For to expenses and primarily be security labor employee between expect a to offset and up information are Higher and the higher in X% year, full be X% X.X% costs. pension decline be we costs. of to premium, IT around related and costs other due benefit

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

XXXX, year quarter X% the Thank you, million life Frank. quarter $XXX the up sales ago At quarter first of down slightly first X% XX% underwriting $XX $XXX to while up from grew net margin year life was ago Life, year. year premiums In life last were were million. of American quarter Income fourth over and to quarter ago million, the X% they from from declined the a sales

of division. trends year very average expectations our count consistent this and agent on from a producing sales X% count up momentum X% last discussed up first see X,XXX, the the the and is with positive with quarter the ago The call. for and in fourth agent was and the I'm quarter from lot quarter encouraged

average count X,XXX, producing due quarter for quarter from life million. quarter. up X% year and The to million, quarter the the $X million National, were from over were to was a X% to $XX year million margin sales net to life $XX life up Net underwriting Liberty was and productivity. XX% XX% the increased premiums up up ago XX% agent sales count health ago agent year increased first $XX and At ago

I'm premiums margin sales health health the strong underwriting primarily Family higher X% and very results to increase $XX activity. year Heritage, over recruiting pleased experience. increased Liberty the is XX% The At generate and $XX as improved increased underwriting million successfully in million. premiums here to due ago margin continues claim with to quarter to and

quarter Net XX% from primarily were up agent up sales million, for to to increased the XX% count. producing quarter. count ago The year the health $XX agent due average X,XXX, first was

recruiting development. previously, has this shifted agency several and As over to we've management last focus the mentioned quarters middle

decrease is X% in our The year quarter lead-related in increased premiums to million, deferred life expenses. underwriting underwriting $XX division, to direct-to-consumer ago to declined due acquisition X% margin non primarily the Now over life margin increase in million. $XXX but an

quarter. Net X% ago down from life million sales were year the $XX

have our mentioned we pull to to business mail There for one offset marketing inflationary marketing has as investment circulation facet an that ability environment. the which impacted campaigns. our to costs direct-to-consumer and on as been has direct acquisition more of postage impede and activity is our had previous back paper achieve on return than we this, costs specific is in on Internet to mailings lower As our marketing. by current continue calls generate somewhat increases We've satisfactory

In at approximately compounded rate our business. of fact electronic since growth have currently XXXX grown XX% a and X.X% annual sales new are

General to Agency. United On American

at of sales quarter. X% to premium underwriting is of margin XX% increased the premiums $XX up Net in $XXX primarily with which ago year sales health year year were increase Life over quarter net in sales is the million million, health ago quarter. XX% ago $XX and million, to The is consistent Globe health Benefits. health the growth Here the the due

Projections.

low of going nice growth low at pleased the I'm year. agencies on Income growth; have double-digit for to very I National At the and that that of Are seeing agent producing to double-digit talk are low with average remainder that Heritage, we three growth. trends exclusive experience XXXX our Liberty count growth; business, based all to and as double-digit be double-digit trends our project about through Family expect Life, follows. we the low Now, -- are the to want American

Life, follows. health for relatively single-digit low life full sales for growth; the low growth; low XXXX Liberty for sales growth flat the the to At Liberty Heritage, full Income be are mid-single-digit National, direct-to-consumer low expected double-digit General Net full are Family down growth. double-digit follows. to National, of and year United as and to year slightly expected American XXXX double-digit as Agency Net be year. American growth at

I back turn to the will Frank. now call

was the On the from Excess to turn the of now reflecting year net impact basis, million was up for we We'll which income interest investment per share Matt. define share program, investment our XX%. excess operations. investment income required XXXX investment less $XX XX% only quarter. a repurchase up ago income as Thanks,

Acquired Net quarter with investment the increase interest from adjusted in the year income in the impact from the net ago as X% year X% was of $XXX quarter. to line policy adoption the LDTI liabilities. ago is reflect million, up over up

we steady the full And to of in investment net result For growth environment our grow the as rate income invested investment to year, assets. expect and and XX% grow favorable X% approximately XX%. a excess between income

invested fixed and average municipal, quarter, the industrial yield. million and sectors. at yield average regarding A an We we life an investment-grade rating and in Now, $XXX investment X.XX% primarily the average of maturities, XX of invested years. an first in In financial our of

additional debt-like our mortgage expected partnerships will that line in and produce characteristics. in mortgage loans These million $XX and invested also our investment philosophy. momentarily. further limited investments are to loans have I are discuss conservative yield commercial We with commercial

the points the was from the the X.XX% For first quarter three up quarter entire first basis fixed flat versus quarter. and maturity yield of XXXX portfolio fourth

yield was portfolio March As X.XX%. the of XX

regarding ago. investment same the Invested grade at billion minus. Now Of A of with the of assets portfolio. -- billion $XX.X fixed cost. maturities, the portfolio million a fixed an maturities average are as Overall, rated total of billion including is investment $XX.X A- $X $XX.X of year rating amortized

regarding and investments. would loss to X% We maturity the commercial make our loan comments I a bonds. an roughly investments first realized fixed mortgage of of million after-tax are $XX portfolio. Signature banking during on few Bank bank quarter our Total like

exposure Republic ATX First defaulted. which been We We or bonds, the bank due have that developments. impaired Bank any have recent the Valley Suisse also in million to did to not second the hold $XX bonds quarter Credit of Silicon

loans. mortgage commercial our Regarding

We directly X% our total on held sheet, our which book balance net million of is CMLs $XXX value of investment have portfolio.

of We managed value, fair also have total investment partnership These X.X% that $XXX and portfolio at the and limited invest MetLife. million CMLs. in or updated funds of quarterly by PIMCO carried limited are which partnerships is

traditional from return investments commercial most rate certain diversification extensions, our of prefer two the believe and CML that criteria partnership corporate types loans transitional profile maturities and limited securities. good a hold these floating loans generally or if CMLs they We provide of over one-year risk optional have and away bridge are of The mortgage met. three-year loans are we directly

particular improve typically bridge loans or Transitional a property. otherwise used renovate are to or

For loans value are as-is the that which the the transitional filings not does take balance our appraisal reflect time our original at was account after sheet, regulatory into appraised increases value the mode is completed. on initiated, reflected are oftentimes the any in in renovations

the the The loan-to-value use supplemental we consideration, method and the appraisals at expected using loan value of other than take on techniques to origination. and website renovations in basis what comps Thus are information the are provided into property, original the filings. have – time the in stabilized we consider call appraised such we values regulatory reflects reflected values effect the we market appraised our in stabilized that loan property's higher typically the value, on appraised standard evaluating is the the appraisal

balance gross value tell the prior our directly were With originated sheet respect of to CML to $XXX on XXXX. million book

criteria. XXXX, rata satisfaction with the $X million loans properties. $X portion Of loans million million mixed-use $XX related XXXX, subject to have of of properties certain plus $XX only to We in million pro in office have are which optional of related extensions of the maturities maturities to office with

the average none is greater maturities XX%. with XX% ratio XXXX The of loan-to-value than

for X.X% and CML losses these our our generate. specific investments believe by properties the Our the CECL the is CML additional in of or is which million structure Based our and $X.X on inherent CML both we is yield expected risk value. incremental direct that the involved, they offset lifetime book than equivalent allowance of underlying portfolio, more to indirect investments

website financial and his our included been in will in under Relations provided we As portfolio Tom additional investments information These discuss CML Financial banking testing and mentioned in on Investor have Reports information. stress investments earnings comments. regarding our other that release, our our have

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

loss by rate-driven. have noted, position we and is we not historically As concerned the are mostly interest unrealized

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

quarter. ago fixed are the rated Bonds to XX% maturity from year XX% BBB compared of portfolio the

is market, with bond ratio relative to our line this the in is While peers. overall high it

keep asset-backed CLOs no little as derivatives, mind residential common that assets, and such have higher-risk securities. in other However, we or exposure mortgages, to equities,

not the rates many best capital-adjusted other or the direct to to large equity private unlike regardless any investments insurance due companies, acquire BBB we equity to we securities provide maturity, do have real of our equities. that fluctuations hold exposure estate Additionally, We that in ability part securities interest believe or markets. risk-adjusted returns to in

historical bonds Below of still is $XXX million a percentage near year to are bonds ago. lows. to investment-grade investment-grade fixed below $XXX million maturities The compared X.X%,

In addition, of over bonds the it eight are years. lowest plus maturities, rated ratio in has XX% been BBB below investment-grade bonds fixed

outlook believe in the utilized well opportunistic the lowest we criterion negative securities amount either long, higher-yielding the by agencies multiple to survive the to to but downturn, a process our positioned watch XXXX. a at also invest an maturity a in such purchase Because negative cycles. Overall, is only must since be portfolio of have primarily not that standard key Finally, we are our market scenario. issuer we investment or to rating ability and level fixed is subject

We our portfolio have fixed multiple under performed through maturity partnerships. tests on stress commercial and and both limited our mortgages and scenarios directly held

average the these address yield an full X.X% Tom year, billion X% the $XXX an at At of to his we implications investments loans noted, approximately capital stress expect guidance average in of commercial in approximately $X of comments. with for yield midpoint partnership invest our of approximately will maturities at X%. previously the million debt-like tests potential mortgage and to fixed As limited in and characteristics

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

Now, I'll over liquidity call Tom on his LDTI. turn the to and capital for comments

Frank. Thanks,

million the liquidity available a with quarter, the million. capital In began and minutes repurchased spend repurchase the X.X share liquid to our of First, want first I a discussing few of position. Inc. annual program, $XXX stock of our the lower assets Globe recent of company of The year includes repurchase $XX acceleration parent to million total for prices. Life which advantage shares take share common million of $XX approximately cost plan

these price million common Year-to-date for cost ended the first a liquid approximately X.X average million Inc's stock share $XX for shares share was purchases assets and The Life Global total $XXX.XX average price quarter of purchased we of have at an of million. of $XXX with $XXX.XX. we

parent, to the excess liquid first throughout do so cash will the the to addition quarter generated the parent flows In company held continue assets by XXXX. and during

the less dividends its anticipate to the results This the Parent due dividends in XXXX which and higher in the company's as excess primarily is to be form paid from XXXX repurchases. million the Parent in to in by return share lower incurred shareholders resulted available received were full define cash year is than parent the through debt. for subsidiaries in XXXX from XXXX. XXXX, statutory flow company's on to dividends the $XXX Parent will to XXXX excess $XXX in we We approximately compared providing thus losses million income amount its interest the to higher of than and flow received cash it, higher as life primarily

assets $XX we we have noted, quarter, million of to liquid assets targeted. liquid at to $XX million had end compared previously the of that million historically the approximately $XX As as of

In share cash $XXX payments distributing $XXX after remainder million liquid of approximately the anticipate million million assets, the to of for generate second million excess repurchases addition of date form available $XXX remainder to assets $XXX the million of million taking $XX the approximately in $XX consideration into the remainder the $XX to million of expect XXXX of to quarter. of for XXXX. the $XX of to to us dividend we flows with million Parent to in the XXXX to approximately shareholders We our for providing

we In proceeds to to have and to loan monitor XX-month maturing. million used term on XX, capital of million debt $XXX notes April will senior this company needs. May, In closed the term retire maturing debt of $XXX approximately the markets our continue the XXXX. loan on senior May X.XXX% want be We

in reduce new debt, other Our long-term current plan is long-term pay to to off issue needs. and loan, short-term the meet debt long-term debt term senior XXXX capital

cash as share primary will insurance best As calls, that noted of as new as future modernize on use by Parent's our capabilities to previous we believe over issue information after new will other other use well Thus still to be possible. operations be excess provide the from to the we shareholder -- the fund technology received share other to alternative investments continue expand alternatives. return yield available policies, cash should dividends. efficiently during shareholders that anticipate after repurchases is of needs. the the repurchases and our or the flows the as payment We our our insurance It operational noted our acquire long-duration cash have assets made cash their substantial the subsidiaries year Parent to and

anticipate remaining repurchases between and $XXX to XXXX. we In the insurance will guidance, within levels and during our subsidiaries. The operations regard million capital repurchase $XXX targeted maintain share at support the levels our year. of sufficient earnings amount our the capital program million share in to With is insurance occur

consolidated of the our XXX% Globe support At capital to levels Our goal range subsidiaries the current $XXX target a RBC end XXX%. ratio, action At to to RBC company ratio approximately had time of RBC ratings. XXX%. low XXXX, was at required the Life of level our the million targets of that our in capital maintain this meet consolidated over is of ratio amount consolidated end XXX%. to our RBC our necessary

anticipated is related of RBC XXX% range to $XX of loss losses targeted and approximately Republic million the our of first midpoint to $XX near reduced after-tax Bank, the to ratio the is XXX%. adjusted RBC realized quarter for and First When million XXX%

We to are or to that a factors. economic other downgrades any well-positioned our may needed to defaults subsidiaries capital recession insurance by potential due and additional additional address due occur

tests levels under that As losses investment these stress our we various of performed in those areas. we of maturity Frank portfolio in our downgrades stress reflects provision excess portfolio rates routinely in portfolio Under loss CML scenario. the a on severely Fed's and include mentioned, the anticipate defaults multiple in tests, in for adverse our fixed

would maintain additional The planned. would capital the $XX but the extended year, if not months. of of program consolidated to portfolio to capital this as would Under sources our the million our before estimate within RBC XXX%. liquidity Even XXXX million our they which we of RBC long parent defaults of sufficient as if stress in ratio losses needed and in do our period, internal over $XX to occurred be downgrades rather the test CML occur that and needed has as our end of all consolidated only capital range an be target scenarios, share dividend our could target our is low the anticipate to repurchase end losses emerge under XX anticipate maintain continuing while we it between meet

Now I'd first the policy comments provide like results. to few related quarter a on to obligations

reflect near-term. about included the of both continued LDTI third In our current on our under calls, in supplemental in health excess our talked mortality historical the each XXXX. on of in available updates quarter The life results updated have particularly sub and information we the of we've life website As for prior we operating XXXX, estimates financial assumption quarters assumptions. the

compared and to life gain remeasurement available shows quarter, the showed the a which of when the slightly on or loss the financial by favorable small changes current website This information indicative resulted provides of it quarter, life distribution persistency. assumptions the current in assumption The any, first loss period to and our obligations mortality changes, remeasurement gain the the in fluctuations quarter. as impact supplemental shows allocated policy fluctuations. For which channel. exhibits, if past is assumption The fluctuations experienced in remeasurement the well In absence of gain of experience or as periods. our are

the obligations the for gain to quarter the remeasurement policy $X.X obligations, $X fluctuations had the segment for reflecting fluctuations unfavorable million The for policy in favorable quarter. for was In changes higher the lower segment life million while resulted quarter reflecting no we health long-term first assumptions.

with share our to will indicated anticipated. December in than are for $XX.XX projecting price be policy common in lower midpoint of increase and to to higher XX, XXXX earnings of impact Finally, The guidance is we quarter. operating largely guidance we XXXX, higher what in the of expectations The than ending our the respect had result per slightly obligations margins income XXXX. diluted a as lower range life $XX.XX of per our net share last year due for $XX.XX is the share previously

comments in the XX% Frank's XX% guidance of call the XX%. be full underwriting our on underwriting with we margins the in for range range margins last of to to the and to Consistent life health and year anticipate be to XXXX, XX%

were we obligations believe assumptions year. recently over of our the updated, policy obligation first quarter ratios are that indicative emerging Given

significant. anticipate time, each do this assumptions year. third to that updates quarter in reviewing and believe At the we be be will We making not

quarter costs the this XX%. year a in percent is be premium as expect full consistent acquisition the with and Total non-deferred to commissions amortization XX% we including first both and of acquisitions

statutory any changes ultimately parent claims amount our nor to is only flows, amount the While that the for in will we the the to our make changes excess require the of on we be of and future none rates, no capital or regulatory the company's impact it pay. significant has of recognized us timing we of changes products that Furthermore, mind cash statutory accounting impact were our we and the profits changes collect, will it that in purposes GAAP it new to impact cause important when premiums maintain premium keep the offer. earnings, the

comments. Matt. it are I'll Those my to back now turn

Thank are you Tom. Those comments. our

We call the will open now for up questions.

Melissa, call the we're questions open now. ready for up to

have in go Bhullar. think And ahead. questions I the question a first few Instructions] we Jimmy, come our do Jimmy please you will [Operator from may queue.

Hi. Thanks.

and Bank year? First next should just dividend on and potential your their on, and the first the we will going that Signature just next and loss impact income buybacks an So have upcoming you're as a statutory year, on on share impact question took you investment buybacks capacity Republic loss assume into losses that on

result Jimmy. lower dividends would the be expect earnings receives as We that losses. impact Yeah, Parent our which from in XXXX, a in to XXXX statutory subsidiaries the those would of

And Okay. then,…

tell buybacks It's are impact plans too XXXX. really early for our to what the on

Okay.

Go Yeah. ahead.

decline And assuming stat should two then, the commensurate else? be on losses on with nothing the the banks in income

No. That is right.

net the smaller realized of had So a that the Georgia as related a as We long we through total included losses $XX that you University bank. in income an there would was was million in about go statutory to Republic, did have think quarter the in one in basis. small there after-tax the first on XXXX, as the as bond well. property But that

Okay.

note was And just that… I going then, Jimmy, to

then… And

whether certain of note be subsides. of COVID there's claims, so expectations -- I that payments think going it to those talked the excess we obligations to on as from kind and a the with the Jimmy, obviously just about we COVID-related other past still or our we've of as changes respect -- have then, And loss was in amount in

little it's So see. early bit a to

than be initial that XXXX those what in lower I would they in were think the anticipation XXXX. was

see that out the the We'll some statutory we over course over growth how year. plays of our So typically as well have time. earnings in

sales be down circulation then, like change the your is unless growing mailing Obviously Okay. activity? business comes much just direct your decent we but if it on that should assume in business seems response. volumes inflation there Internet of then shouldn't And the and -- a a amount

it Jimmy, Yeah. does.

other. offsetting two You're correct. are Those each

we'll in to costs are reducing Our past, of offset of channel. our sales. because course in increase mail. production we're But of continue XXXX, remainder of trying in do Internet the that we've with to of through -- some And with in higher that we that likely mentioned cost associated circulation the most as the those

a And sales for decline why guided to a so from that's perspective slight XXXX. maybe flat we've essentially

then, just you And channels lastly, market recently? Okay. fairly with would could environment been the stunted the been it's would on across comment labor I agent but the various tight the growth actually strong have thought recruiting have

Yeah.

As we've talked about are in the sources past, environments. things it we've been of economic about, able at different are to we good really successfully we recruit that And because look in a what recruits. variety of have think we we the doing, always as

we And on can so onboard agents. effectively really we new focus how

And onboarded as of who's in that's and able new mentioned, that count. them to a we're the that recruiting be training a count key growth aspect the agents, doing grow management of on that lot them agent growing getting middle we've to focused

an an seeing from from macroeconomic employment not really a perspective. we're So environment impact

on. the year count are reflect if And agent on QX that continuing showing end put fruits and first growth Family in of the of about quarter. That then, right talked some is of here call last things the in the at place QX year. Liberty some as we've had in the Heritage you AIL, last momentum back we we and strong And on, in

divisions. putting the of place just upped on each the agencies, projections count three that growth based agent And we're things those all in so individual at we've in AIL for in fact of the our and across

Thank you.

Wells And Fargo. please go our question next from you. Carmichael Thank comes Wes of ahead. Sir,

good Hey, morning.

also here around $XXX But be paper you the a and draw I debt that's million mentioned think maturity that's there's coming term met in I with on May think going the I up commercial to loan. due. senior think some coming that's

expecting is are to another to going you satisfied loan that draw term be be also that So the way? met with or

there, commercial then and have issuing again. generally paper We Yeah. out maturing

expect just maintain as we of well. there. commercial million we will generally So paper paper out commercial $XXX would to And $XXX to that million that reissue

And outside mixed it X% bucket the the bucket, CNL mentioned office to of helpful. a portfolio office. most transitional looks shown like use That's loans portion you in partnerships, And is on Got related are the it. think for but the part. or then the there bridge also is good limited I

So higher owned on about having thoughts some are due within test CM charges you of estate? those real drift take like that capital in your are as or either any to from potentially how portfolio stress loans your to thinking on ratings

Yes.

Fed's stress some drift in is on those severe of But actually the as times when -- severely took look have on a those, drift any downgrades, about kind that the potential So assumed along same rates well. scenario. at downgrades looked the those would XX% consideration take with within then test did the if loss did the loss stress adverse way at portfolio. we a did high-end our we fixed at We we we the in the have look in that into rate, which maturity about the both two we

so. is I around or X.X% there think

And in doubled so what we included to that our we respect stress with test.

didn't this bit, to Thanks. a little but touched it. release you mortality. And or excess COVID have on Got anything press related the

deaths in embedded year. Has guided the that changed? mortality is Is case? this much I of the around $XX.XX U.S. how XXX EPS And think the still of that to previously excess guidance? maybe midpoint you that

Yes. Good question.

So will XXX,XXX. U.S. we think still year deaths COVID the in be around the for around

changed from haven't that We estimate.

what an both non-COVID pandemic we perspective reflected assumptions causes. thought updated the and COVID excess from we While year, from we last from deaths our

the So of our embedded our in that's guidance. midpoint

Thank you.

Sir, Piper comes please question ahead. our Barnidge Sandler. go of from next John Thank And you.

to rates opportunity, with that about compare then you versus much you occupancy of maybe office and Thank suburban? stick central for If Can talk it and bit. good very the we morning. the could mixed-use business district and a investment portfolio

XXX… Just in broad general on the

about and talking the mixed around then XX% talking I'm -- uses. the that I'm of specifically office

Yes.

about million ones office. XXX% got the here that $X of on maturing we've XXXX, So -- are that so are in

One was property. that $X City. to of about one use use million located those mixed And allocation a those D.C. in office of the there's Washington, on in New of particular York then

due that's properties So there's in make in three that amount here it's only maturing entire that XXXX, XXXX. or up

is in process for the in that of they're extending One actually XX of doing another renovations, those months. process the

be will that So extended into XXXX.

The other a XXX% that's one office

then it's are they're into selling back actually portion that it of bit and process taking repaying -- It's pay offices. they the goes a they to offices it sell They're -- that. selling as different, loan. around of And little back down those it's a because on in condo the style

around Given a sale actually bump of the property the loan-to-value to kind that -- some of of XX%. it particular from ratio points current

they've So XXX% something point at the we're in leased actually this actually not got it's very And and concerned mixed-use on occupied time. there.

My That's mortality. really helpful. follow-up on

Some talked early flu an seasonal you Others that the talk peak in in quarter. of have you. about maybe the your fourth suggested occur. Can Thank quarter? didn't about us experience

Yes.

mentioned Just favorable had we small -- a that the during quarter. in mortality fluctuation I

were with pleased consistent results we kind mortality expectations with the really overall our of slightly So very positive.

the Thank Appreciate much. answers. you very

our you. comes next Thank from ahead. Please Bass Erik question Research. go of And Autonomous

you. Thank Hi.

just excess in your you RBC guidance you they'd year, losses ratio just that, placeholder be in your give is question when have for or flow First the if borne subsidiary? free any do by cash occur that on assumption for the those credit the

portion. and anticipate right? some, latter, losses gains the we'll We base during we but -- our a course have does the significant access year, in the And don't losses. But realized not assume do of It's general some reflect really any losses. so case

and our liquidity currently that surplus excess in we the say borne any be the ratio RBC resources So other our in our would have. that I'd in losses we -- subsequent general, have by

there's of why with losses, RBC flow cash no your Got it. brings your but on just really Which free expectations? guess, comfortable, these it the the impact ratio is, to midpoint you're I range,

liquidity just that resources occur -- have those to we resources we available. addition, us, have we if in our And losses available did Exactly.

we look that cash as that although have year the from really next that would the losses cash flow, -- necessarily stress again, those will be a flow. when by we're we'll that that's of happen maturity we don't - and we're excess we think again those side. cash really from especially tests, year's statutory as because particular year's But bottoms-up on the approach, again, trying that will ability out earnings, what so, subsidiaries again, included affect to affect as simply this doing our in look end flow the free as our and any And any to don't it we up have portfolio, flow what fixed not losses test. about stress at we Remember again, think last because hold, our from driven happen, we maybe at we think could necessarily cash of dividends

actually anticipate losses would be during year. don't we occurring the So that

liquidity loan can decision use Thank And debt off you as now? Got senior with. that think of to much hold liquidity the kind issuing how you. to next guess now you at And you deal term to about it. change have about then I the maturity all pay management, talk term opposed to the the year to loan Does you maturity you'll need of how hold? to want think as debt or

Yes.

at the our a that at maturing, just way as of was maturity look we ladder As we're trying we to is we to refinance that options. were well. looked to do And about number of the the things -- one debt thinking best

we thought some of best issue going space forward. to to And debt it XXXX so in our maturities out

Got you. it. Thank

of from our Sir, Ryan go Krueger Thank question next ahead. And please comes you. KBW.

that basically is change good understand underwriting you that the the I made -- made all continued under morning. mortality, or of assumption reflect is excess -- margin XX% mortality, being that last is guidance XX% at does given you LDTI some the upfront just to negatively actually level did an to that assumption year already that already? impacted excess Hi, wanted by for that the

to assumption Yes, year up margin. that underwriting year reflected last XX% last XX% -- in ended being the

So embedded. it's already

would the guess is, question ask I much how -- maybe to maybe if margin it. be subsided? way the upside another of kind that excess there mortality Got to fully if

about probably X% it's maybe. Yes, premium,

you leverage could up an consistent end losses, then end Got where you one credit thinking capacity about think the did had in it. level? just more additional do a and at issuing more. if And buyback are How we just debt you environment maintain your up you

Yes.

capital is ratio, first as quarter debt XX.X%. the Our of

quite million kind ratio, where have of of million bit a be XX% a million cap their debt Moody's over $XXX which -- we sets $XXX bit is So capacity debt below limit. a to or $XXX

well that capacity. the more actually expect capital us to give as to debt quite So, down year And debt we'd the capacity. course of go a bit debt even ratio of during

Thank you.

Thank Kligerman question please go from ahead. Sir, Andrew comes And you. Suisse. our next Credit of

how I'm American result? really number new Interesting seasoning morning. of Good Income and that's could the of life agent, sales And I and recruiting a kind of agent year recruits, X%. count guidance we for just as a year you're and producing next Their up along, average nice curious expect about coming the up kind is think was this low-single-digit. these X%.

Yes. Probably history bit. in little a go back just

QX in in in sales. had As the XXXX. look in XX% AIL in far XXXX, QX had sales increase quarter a last we as, life of sales. increase so the XX% of for of then a if We at year, increase life And life second you

quarter at So we've count the the recruiting come. tough and talked so the a year to to comparables of yet But to for we've year. is as when got this prior in about leading agent the in the the look speak first sales quarter compared past, as indicator you second

first what count very growth throughout that quarter just so is we're agent the in of And year. about the this pleased

And in we the again in week fact Income. American XX,XXX March, each of over were in agents month

a effective about up the So from that agents agents more producing perspective. obviously past momentum those experienced as as are the we've in get and more talked sales

the that of as into in So get expect over half would XXXX. last this on-boarded obviously carry more new year experience, that growth and agents to we sales accelerate then those

I little could get just you numbers the on you maybe there? then And those -- staying topic delta American a And mentioned What's initiatives branch talk Income. and the the increasing that about Very bit within didn't helpful. managers. And impactful? exact how

far growth As middle first of in this up American in XX% as year. the quarter our management it's Income,

what that's pleased very So with. we're

again agents, as as good. very training growth offices owners to that and XX% agency a number onboarding from throughout the well. new growth so to still being management anticipate Income well five recruiting American in as that for open that's XXXX in the helps there three We perspective be good range So new us and middle in predict as far just as

lot. a Thanks Excellent.

question ahead. Burdis Wilma of Raymond from comes James. go next Our Please

morning. Good

bit. on Could health Just more talk a bit you what there? the that little a question happened just a drilling margin little increased

to if kept do Heritage. -- overall. we experience we seeing margins when health but continues we feel And a range Yeah, potential on the a higher. to little the we Family it favorable same, the see the up have move that could up bottom like, end We're bit little of the go

that others for the On a of the of and provides first Medicare kind UA think But actually that that's Family Heritage seasonality have seen And supplement. bit we we quarter little side seen upside. claims with consistent as I little a some well. have bit of an fairly higher think opportunity

this on seems sales it see. sales came is kind one like of a But my that year? recessionary little And the great pressure through to question of bit any Great. there's and numbers which guess could impacts all a little is, up flow bit I recruiting quick if

that. different Generally, in haven't economic the look really past, trends we've seen through as we

is count really sales growth middle growth by really driven growth growth. agent count driven by Our agent management and is

just driving of growth onboarding that's the so is for revise sales agencies management seeing new why in count in really us the seeing agents projections we're year. the well the three And our our momentum that the as you're across up as what's

Thank you.

have Wells go do Carmichael remaining Please one one [Operator Wes ahead. Instructions] Fargo. of for We now.

one. Actually, Hey, technical call. I taking thanks for follow-up had a my

As diversification we're C framework it credit I'm really does about stress through the about testing thinking risk. you but kind thinking RBC the of of and benefit give

about for pretty think any benefit So within credit diversification to if a CX, that see makes risk, guys was just I way if sense. there's if thumb think a CX the you company. I any heavy are you wondering rule of

There would in CMX. just And misunderstood, XX% here, CMLs you're or I maybe looking of question be are some -- on about you there right overall, our the…. your

Yes, like sure. I'm just -- thinking if really that's

growth it So offset against do square XXX% But those factors. that calculation CX math then about then like into RBC to when your you gives root the XXX% the you RBC and target. gross to formula, put you charges the think if some actually could you

-- So not we're I'm a thinking thumb overestimating of about to can the is impact for RBC. just use, Globe so there drift rule credit we

think be the honest. that lot there to I that, sure thumb look definitely, I'll I'm you charges. Yes, we that We think would give be. able is CX as what do about mean rule of I I'm that you the not diversification the give a we we be that with try diversification handy, to of quite bit, to portfolio. don't then have a have honest, something thumb. I'll to rule across size that I get and and work about trying --

AOCI. on favorable retained last LDTI. Okay. just like one a might there earnings have And value and been looked impact thus on It book ex

few thought wondering, you in was to a that pieces, share the that? a a ballpark? My it way I Just quantify is have math but that versus Is there prior was handy? gas. there's Do moving around $X.XX

of restating small. was framework, traditional it sheet put XXXX didn't about retained and -- was relatively the seeing then are but like balance I a that change we million. that There's under It definitely result as earnings was and $XX higher in XXXX LDTI. earnings

to million. would we LDTI earnings previously had So by guided $XXX to, increase $XXX the million

is actually million we've XXXX, you. supplemental you, look million But numbers. over about about what to I where the earnings the might think XXXX restated and was helpful financial guide that And $XXX be historical historical. favorable information And will was $XXX to over XXXX so favorable in help

adding retained of that's about of XX/XX/XX. right. So yes, historical XX/XX/XX, earnings So right? $XXX numbers the the as just retained to that's of million, the because restatement prior to earnings

was math My perfect. X.XX%. That's

the we're But, sounds appreciate like follow-up. So in the same it ballpark. I

that if on got as in under a the that those well part of because got the that the out we from you're as pushed lower fluctuations of is large so course, COVID both restating thinking large LDTI then those of years, a future chunk with of prior impact amortization. the it years, about And good in years, had

Thank you.

to Thank further as back questions, no have remarks. for to closing like you. hand And Mota, Stephen we it any I'd over

our All next us talk right. this comments, Those joining to quarter. we'll you for Thank you and morning. again are

our everyone. concludes That Thank you, call.

by. please stand Hosts now disconnect. may You