v3.26.1
Value of Business Acquired ("VOBA"), Deferred Acquisition Costs ("DAC"), and Deferred Sales Inducements ("DSI")
 3 Months Ended
Mar. 31, 2026
Goodwill and Intangible Assets Disclosure [Abstract]  
Value of Business Acquired ("VOBA"), Deferred Acquisition Costs ("DAC"), and Deferred Sales Inducements ("DSI") Value of Business Acquired ("VOBA"), Deferred Acquisition Costs ("DAC"), and Deferred Sales Inducements ("DSI")
The following table reconciles to Other intangible assets, net, on the unaudited Condensed Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025.
March 31, 2026December 31, 2025
(In millions)
Customer relationships and contracts$330 $349 
Value of business acquired 1,161 1,196 
Deferred acquisition costs 3,752 3,637 
Deferred sales inducements 944 891 
Value of distribution asset60 62 
Computer software286 289 
Trademarks, tradenames, and other 228 217 
Total Other intangible assets, net$6,761 $6,641 
The following tables roll forward VOBA by product for the three months ended March 31, 2026 and 2025:
Indexed AnnuitiesFixed Rate AnnuitiesImmediate AnnuitiesUniversal LifeTraditional LifeTotal
(In millions)
Balance at January 1, 2026
$770 $18 $178 $119 $111 $1,196 
Amortization(29)(1)(2)(1)(2)(35)
Balance at March 31, 2026
$741 $17 $176 $118 $109 $1,161 

Indexed AnnuitiesFixed Rate AnnuitiesImmediate AnnuitiesUniversal LifeTraditional LifeTotal
(In millions)
Balance at January 1, 2025
$892 $22 $184 $126 $125 $1,349 
Amortization(31)(1)(2)(1)(3)(38)
Balance at March 31, 2025
$861 $21 $182 $125 $122 $1,311 
VOBA amortization expense of $35 million and $38 million was recorded in Depreciation and amortization on the unaudited Condensed Consolidated Statements of Earnings for the three months ended March 31, 2026 and 2025, respectively.
The following tables roll forward DAC by product for the three months ended March 31, 2026 and 2025.
Indexed AnnuitiesFixed Rate AnnuitiesUniversal LifeTotal (a)
(In millions)
Balance at January 1, 2026
$2,205 $402 $1,021 $3,628 
Capitalization126 8 77 211 
Amortization(54)(28)(16)(98)
Balance at March 31, 2026
$2,277 $382 $1,082 $3,741 
Indexed AnnuitiesFixed Rate AnnuitiesUniversal LifeTotal (a)
(In millions)
Balance at January 1, 2025
$1,874 $376 $781 $3,031 
Capitalization126 21 69 216 
Amortization(45)(25)(12)(82)
Balance at March 31, 2025
$1,955 $372 $838 $3,165 
(a) Excludes insignificant amounts of DAC related to funding agreement backed notes ("FABN") and PRT.
DAC amortization expense of $98 million and $82 million was recorded in Depreciation and amortization on the unaudited Condensed Consolidated Statements of Earnings for the three months ended March 31, 2026 and 2025, respectively, excluding insignificant amounts related to FABN and PRT.
The following table presents a reconciliation of DAC to the table above, which is reconciled to the unaudited Condensed Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025:
March 31, 2026December 31, 2025
(In millions)
Indexed Annuities$2,277 $2,205 
Fixed Rate Annuities382 402 
Universal Life1,082 1,021 
FABN7 5 
PRT4 4 
Total$3,752 $3,637 
The following table rolls forward DSI for our indexed annuity products for the three months ended March 31, 2026 and 2025:
Three months ended March 31,
20262025
(In millions)
Balance at January 1,$891 $625 
Capitalization73 71 
Amortization(20)(14)
Balance at March 31,$944 $682 
DSI amortization expense of $20 million and $14 million was recorded in Depreciation and amortization on the unaudited Condensed Consolidated Statements of Earnings for the three months ended March 31, 2026 and 2025, respectively.
The cash flow assumptions used to amortize VOBA and DAC were consistent with the assumptions used to estimate the future policy benefits ("FPB") for life contingent immediate annuities and PRT. Those assumptions will be reviewed and unlocked, if applicable, in the same period as those balances. For nonparticipating traditional life contracts, the VOBA amortization is straight-line, without the use of cash flow assumptions. For indexed annuity contracts, the cash flow assumptions used to amortize VOBA, DAC, and DSI were consistent with the assumptions used to estimate the value of the embedded derivative and MRBs, and will be reviewed and unlocked, if applicable, in the same period as those balances. For fixed rate annuities and IUL the cash flow assumptions used to amortize VOBA, and DAC reflect the Company’s best estimates for policyholder behavior, consistent with the development of assumptions for indexed annuities and immediate annuities.
F&G reviews cash flow assumptions annually, generally in the third quarter. In 2025, F&G undertook a review of all significant assumptions and revised several assumptions relating to their deferred annuity (indexed annuity and fixed rate annuity) and IUL products. For the three months ended March 31, 2026, F&G updated the assumption for option budgets. For the year ended December 31, 2025, F&G updated the assumptions for option budgets, surrenders, lapses, mortality and mortality improvement, and free partial withdrawals. For both periods, these assumption updates resulted in increased amortization rates on some DAC and DSI balances, primarily for indexed annuities. All updates to these assumptions brought F&G more in line with internal and overall industry experience since the prior assumption update.
There has been no material change to the estimated future amortization expense of intangible assets since December 31, 2025.