The Company periodically enters into fixed quota-share coinsurance agreements in the normal course of business, primarily to provide additional capacity for future growth, optimize capital, limit losses, and minimize exposure to significant risks. For each of its reinsurance agreements, the Company determines whether the agreement provides indemnification against loss or liability relating to insurance risk in accordance with applicable accounting standards. These reinsurance transactions are indemnity reinsurance agreements that do not relieve the Company from its obligations to policyholders. In the event that the reinsurer is unable to meet their obligations, the Company remains liable for the reinsured claims.

For certain assumed reinsurance transactions involving the reinsurance of in force blocks of business, the Company receives initial consideration for assumed reserves at inception. The consideration received is recognized in the consolidated balance sheets at fair value and a liability for future policy benefits is recorded for assumed reserves. For each of the reinsurance agreements it has entered into, the Company records either a deferred reinsurance gain liability when the consideration received exceeds the recorded reserves, or a cost of reinsurance asset when the recorded reserves exceed the consideration received. The cost of reinsurance asset balance is considered recoverable and is periodically assessed for recoverability. Inter-segment amounts associated with internal reinsurance transactions are eliminated in consolidation.

The following table reconciles direct earned premiums, direct benefits and claims, excluding reserve remeasurement gains and losses, and reserve remeasurement gains and losses to net amounts after the effect of reinsurance.


	Three Months Ended March 31,
(In millions)		2026	2025
Earned premiums:
Direct				$	3,421	$	3,433
Ceded				(135)		(88)
Assumed				24		36
Net earned premiums				$	3,310	$	3,381

Benefits and claims, excluding reserve remeasurement:
Direct				$	1,995	$	2,031
Ceded				(88)		(56)
Assumed				7		11
Benefits and claims, excluding reserve remeasurement				1,914		1,986
Reserve remeasurement (gains) losses:
Direct				(81)		(41)
Ceded				(1)		0

Reserve remeasurement (gains) losses				(82)		(41)
Total benefits and claims, net				$	1,832	$	1,945

The Company reported a deferred reinsurance gain liability related to reinsurance transactions. The remaining consolidated deferred reinsurance gain liability of $294 million and $125 million as of March 31, 2026 and December 31, 2025, respectively, is included in future policy benefits in the consolidated balance sheets and it is being amortized over the expected premium period based on annualized premiums, units in force, or over the remaining expected life of the reinsurance contract based on benefit payments. The amortization is included in benefits and claims in the consolidated statements of earnings.

The Company also reported a reinsurance recoverable with a remaining balance, net of allowance for credit losses of $466 million and $161 million as of March 31, 2026 and December 31, 2025, respectively. As of March 31, 2026, the related allowance for credit losses was $17 million, compared with $4 million as of December 31, 2025. The allowance for credit losses is estimated using a PD / LGD method and the key credit quality indicator is the credit rating of the Company’s significant reinsurance counterparties. The Company uses external credit ratings focused on these reinsurers' financial strength and credit worthiness. As of March 31, 2026, the Company's significant reinsurance counterparties were rated A+. The Company monitors these credit ratings periodically, but not less frequently than quarterly.

In March 2026, Aflac Re entered into a coinsurance transaction whereby it assumed approximately $551 million of reserves associated with an in force block of individual whole life annuities from an external ceding company, which is a related party due to its affiliation with Japan Post Holdings Co., Ltd. Aflac Re received approximately $636 million in cash as consideration for assuming the reinsurance risk. The cash was placed in a trust to collateralize Aflac Re's obligations to the ceding company. Cash and any other assets placed in the trust continue to be owned by Aflac Re, but their use is restricted based on the terms of the transaction. If the fair market value of the assets in the trust is less than a contractually determined threshold, Aflac Re will be required to contribute additional assets to the trust. Refer to the Reinsurance-Related Trust section of Note 3 for additional information.

In January 2026, ALIJ entered into a coinsurance transaction whereby it ceded 100% of the liabilities associated with certain life insurance policies to an external reinsurer. This transaction transferred approximately $333 million of reserves associated with these policies, and ALIJ transferred approximately $236 million in cash to the reinsurer as consideration for assuming the reinsurance risk.