
	As of June 30, 2026

	Amortized Cost		Gross Unrealized				Allowance for Credit Losses		Fair Value
			Gains		Losses
Fixed maturity AFS securities:
Corporate bonds	$	75,626	$	625	$	8,305	$	45	$	67,901
U.S. government bonds	1,001		3		42		–		962
State and municipal bonds	2,437		13		383		–		2,067
Foreign government bonds	240		14		51		–		203
RMBS	2,080		36		157		6		1,953
CMBS	3,002		5		116		3		2,888
ABS	19,161		91		270		84		18,898
Hybrid and redeemable preferred securities	214		8		8		1		213
Total fixed maturity AFS securities	$	103,761	$	795	$	9,332	$	139	$	95,085


	As of December 31, 2025
	Amortized Cost		Gross Unrealized				Allowance for Credit Losses		Fair Value
			Gains		Losses
Fixed maturity AFS securities:
Corporate bonds	$	76,318	$	834	$	8,054	$	53	$	69,045
U.S. government bonds	892		9		32		–		869
State and municipal bonds	2,514		18		385		–		2,147
Foreign government bonds	261		16		51		–		226
RMBS	2,237		45		154		6		2,122
CMBS	2,586		15		99		–		2,502
ABS	16,412		137		217		50		16,282
Hybrid and redeemable preferred securities	242		21		7		1		255
Total fixed maturity AFS securities	$	101,462	$	1,095	$	8,999	$	110	$	93,448


	Amortized Cost		Fair Value
Due in one year or less	$	5,574	$	5,516
Due after one year through five years	19,711		19,252
Due after five years through ten years	12,545		12,077
Due after ten years	41,688		34,501
Subtotal	79,518		71,346
Structured securities (RMBS, CMBS, ABS)	24,243		23,739
Total fixed maturity AFS securities	$	103,761	$	95,085

The fair value and gross unrealized losses of fixed maturity AFS securities (dollars in millions) for which an allowance for credit losses has not been recorded, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows:


	As of June 30, 2026

	Less Than or Equal to Twelve Months				Greater Than Twelve Months				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses (1)
Fixed maturity AFS securities:
Corporate bonds	$	23,365	$	3,339	$	29,373	$	4,966	$	52,738	$	8,305
U.S. government bonds	815		36		43		6		858		42
State and municipal bonds	623		153		970		230		1,593		383
Foreign government bonds	12		2		125		49		137		51
RMBS	505		37		777		120		1,282		157
CMBS	1,297		32		917		84		2,214		116
ABS	6,416		81		2,654		189		9,070		270
Hybrid and redeemable
preferred securities	44		2		54		6		98		8
Total fixed maturity AFS securities	$	33,077	$	3,682	$	34,913	$	5,650	$	67,990	$	9,332

Total number of fixed maturity AFS securities in an unrealized loss position											6,980


	As of December 31, 2025
	Less Than or Equal to Twelve Months				Greater Than Twelve Months				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses (1)
Fixed maturity AFS securities:
Corporate bonds	$	16,727	$	3,366	$	31,404	$	4,688	$	48,131	$	8,054
U.S. government bonds	427		27		36		5		463		32
State and municipal bonds	582		166		995		219		1,577		385
Foreign government bonds	10		2		135		49		145		51
RMBS	345		39		838		115		1,183		154
CMBS	577		19		956		80		1,533		99
ABS	3,453		37		3,107		180		6,560		217
Hybrid and redeemable
preferred securities	22		2		54		5		76		7
Total fixed maturity AFS securities	$	22,143	$	3,658	$	37,525	$	5,341	$	59,668	$	8,999

Total number of fixed maturity AFS securities in an unrealized loss position											6,089

(1) As of June 30, 2026, and December 31, 2025, we recognized $3 million and $12 million of gross unrealized losses, respectively, in other comprehensive income (loss) (“OCI”) for fixed maturity AFS securities for which an allowance for credit losses has been recorded.

The fair value, gross unrealized losses (in millions) and number of fixed maturity AFS securities where the fair value had declined and remained below amortized cost by greater than 20% were as follows:


	As of June 30, 2026

	Fair Value		Gross Unrealized Losses		Number of Securities (1)
Less than six months	$	2,187	$	627	396
Six months or greater, but less than nine months	471		171		118
Nine months or greater, but less than twelve months	909		434		209
Twelve months or greater	5,133		2,314		867
Total	$	8,700	$	3,546	1,590


	As of December 31, 2025
	Fair Value		Gross Unrealized Losses		Number of Securities (1)
Less than six months	$	2,355	$	839	445
Six months or greater, but less than nine months	351		163		65
Nine months or greater, but less than twelve months	302		119		99
Twelve months or greater	5,214		2,195		902
Total	$	8,222	$	3,316	1,511

Our gross unrealized losses on fixed maturity AFS securities increased by $333 million for the six months ended June 30, 2026. As discussed further below, we do not believe the unrealized loss position as of June 30, 2026, required an impairment recognized in earnings as: (i) we did not intend to sell these fixed maturity AFS securities; (ii) it is not more likely than not that we will be required to sell the fixed maturity AFS securities before recovery of their amortized cost basis; and (iii) the difference in the fair value compared to the amortized cost was due to factors other than credit loss. Based upon this evaluation as of June 30, 2026, management believes we have the ability to generate adequate amounts of cash from our normal operations (e.g., insurance premiums, fee income and investment income) to meet cash requirements with a prudent margin of safety without requiring the sale of our impaired securities.

As of June 30, 2026, the unrealized losses associated with our corporate bond, U.S. government bond, state and municipal bond and foreign government bond securities were attributable primarily to rising interest rates and widening credit spreads since purchase. We performed a detailed analysis of the financial performance of the underlying issuers and determined that we expected to recover the entire amortized cost of each impaired security.

Credit ratings express opinions about the credit quality of a security. Securities rated investment grade (those rated BBB- or higher by S&P Global Ratings (“S&P”) or Baa3 or higher by Moody’s Investors Service (“Moody’s”)) are generally considered by the rating agencies and market participants to be low credit risk. As of June 30, 2026, and December 31, 2025, 96% of the fair value of our corporate bond portfolio was rated investment grade. As of June 30, 2026, and December 31, 2025, the portion of our corporate bond portfolio rated below investment grade had an amortized cost of $3.0 billion and $3.1 billion, respectively, and a fair value of $2.9 billion. Based upon the analysis discussed above, we believe that as of June 30, 2026, and December 31, 2025, we would have recovered the amortized cost of each corporate bond.

As of June 30, 2026, the unrealized losses associated with our mortgage-backed securities and asset-backed securities (“ABS”) were attributable primarily to rising interest rates and widening credit spreads since purchase. We assessed for credit impairment using a cash flow model that incorporates key assumptions including default rates, severities and prepayment rates. We estimated losses for a security by forecasting the underlying loans in each transaction. The forecasted loan performance was used to project cash flows to the various tranches in the structure, as applicable. Our forecasted cash flows also considered, as applicable, independent industry analyst reports and forecasts and other independent market data. Based upon our assessment of the expected credit losses of the security given the performance of the underlying collateral compared to our subordination or other credit enhancement, we expected to recover the entire amortized cost of each impaired security.

As of June 30, 2026, the unrealized losses associated with our hybrid and redeemable preferred securities were attributable primarily to wider credit spreads caused by illiquidity in the market and subordination within the capital structure, as well as credit risk of underlying issuers. For our hybrid and redeemable preferred securities, we evaluated the financial performance of the underlying issuers based upon credit performance and investment ratings and determined that we expected to recover the entire amortized cost of each impaired security.

We regularly review our fixed maturity AFS securities for declines in fair value that we determine to be impairment-related, including those attributable to credit risk factors that may require an allowance for credit losses. Changes in the allowance for credit losses on fixed maturity AFS securities (in millions), aggregated by investment category, were as follows:


	As of or For the Three Months Ended June 30, 2026
	Corporate Bonds		RMBS		CMBS		ABS		Hybrids		Total
Balance as of beginning-of-period	$	38	$	6	$	–	$	66	$	1	$	111
Additions from purchases of PCD debt securities (1)	–		–		–		–		–		–
Additions for securities for which credit losses were
not previously recognized	9		–		3		–		–		12
Additions (reductions) for securities for which
credit losses were previously recognized	4		–		–		18		–		22
Reductions for disposed securities	(2)		–		–		–		–		(2)
Reductions for securities charged off	(4)		–		–		–		–		(4)
Balance as of end-of-period (2)	$	45	$	6	$	3	$	84	$	1	$	139


	As of or For the Six Months Ended June 30, 2026
	Corporate Bonds		RMBS		CMBS		ABS		Hybrids		Total
Balance as of beginning-of-year	$	53	$	6	$	–	$	50	$	1	$	110
Additions from purchases of PCD debt securities (1)	–		–		–		–		–		–
Additions for securities for which credit losses were
not previously recognized	11		–		3		–		–		14
Additions (reductions) for securities for which
credit losses were previously recognized	12		–		–		36		–		48
Reductions for disposed securities	(3)		–		–		(2)		–		(5)
Reductions for securities charged-off	(28)		–		–		–		–		(28)
Balance as of end-of-period (2)	$	45	$	6	$	3	$	84	$	1	$	139


	As of or For the Three Months Ended June 30, 2025
	Corporate Bonds		RMBS		CMBS		ABS		Hybrids		Total
Balance as of beginning-of-period	$	23	$	6	$	–	$	44	$	1	$	74
Additions from purchases of PCD debt securities (1)	–		–		–		–		–		–
Additions for securities for which credit losses were
not previously recognized	17		–		–		–		–		17
Additions (reductions) for securities for which
credit losses were previously recognized	4		(1)		–		(1)		–		2

Reductions for securities charged off	(8)		–		–		–		–		(8)
Balance as of end-of-period (2)	$	36	$	5	$	–	$	43	$	1	$	85


	As of or For the Six Months Ended June 30, 2025
	Corporate Bonds		RMBS		CMBS		ABS		Hybrids		Total
Balance as of beginning-of-year	$	14	$	7	$	–	$	24	$	1	$	46
Additions from purchases of PCD debt securities (1)	–		–		–		–		–		–
Additions for securities for which credit losses were
not previously recognized	25		–		–		8		–		33
Additions (reductions) for securities for which
credit losses were previously recognized	5		(2)		–		11		–		14

Reductions for securities charged off	(8)		–		–		–		–		(8)
Balance as of end-of-period (2)	$	36	$	5	$	–	$	43	$	1	$	85

(2) As of June 30, 2026 and 2025, accrued investment income on fixed maturity AFS securities totaled $932 million and $886 million, respectively, and was excluded from the estimate of credit losses.

Losses from debt instrument modifications were $2 million and $13 million for the three months ended June 30, 2026 and 2025, respectively, and $3 million and $18 million for the six months ended June 30, 2026 and 2025, respectively, reported in realized gain (loss) on the Consolidated Statements of Comprehensive Income (Loss).


	As of June 30, 2026						As of December 31, 2025
	Commercial		Residential		Total		Commercial		Residential		Total
Current	$	17,623	$	5,472	$	23,095	$	17,636	$	4,628	$	22,264
30 to 59 days past due	–		112		112		1		93		94
60 to 89 days past due	2		31		33		5		34		39
90 or more days past due	79		164		243		35		144		179
Allowance for credit losses	(111)		(66)		(177)		(113)		(69)		(182)
Unamortized premium (discount)	(6)		139		133		(4)		115		111
Mark-to-market gains (losses) (1)	(31)		(2)		(33)		(33)		–		(33)
Total carrying value	$	17,556	$	5,850	$	23,406	$	17,527	$	4,945	$	22,472

(1) Represents the mark-to-market on certain mortgage loans on real estate that support our modified coinsurance agreements, where the investment results are passed directly to the reinsurers, and for which we have elected the fair value option. As of June 30, 2026 and December 31, 2025, the amortized cost and fair value of such mortgage loans on real estate that were in nonaccrual status were $30 million and $20 million, respectively. As of June 30, 2026, and December 31, 2025, there were no such mortgage loans on real estate that were more than 90 days past due and still accruing interest. For additional information, see “Fair Value Option” in Note 13.

The amortized cost of mortgage loans on real estate on nonaccrual status (in millions) was as follows, excluding certain mortgage loans on real estate that support our modified coinsurance agreements where the investment results are passed directly to the reinsurers:

We use loan-to-value (“LTV”) and debt-service coverage ratios as credit quality indicators for our commercial mortgage loans on real estate. The amortized cost of commercial mortgage loans on real estate (dollars in millions) by year of origination and credit quality indicator was as follows:


	As of June 30, 2026
	LTV Less Than 65%		Debt-Service Coverage Ratio	LTV 65% to 75%		Debt-Service Coverage Ratio	LTV Greater Than 75%		Debt-Service Coverage Ratio	Total
Origination Year
2026	$	888	1.63	$	104	1.38	$	2	1.42	$	994
2025	1,326		1.81	161		1.41	11		1.18	1,498
2024	1,485		1.68	54		1.41	1		2.06	1,540
2023	1,304		1.87	25		1.40	1		1.17	1,330
2022	1,639		2.24	61		1.65	4		1.21	1,704
2021 and prior	10,559		2.73	56		2.67	17		1.66	10,632
Total	$	17,201		$	461		$	36		$	17,698


	As of December 31, 2025
	LTV Less Than 65%		Debt-Service Coverage Ratio	LTV 65% to 75%		Debt-Service Coverage Ratio	LTV Greater Than 75%		Debt-Service Coverage Ratio	Total
Origination Year
2025	$	1,322	1.81	$	182	1.41	$	11	1.20	$	1,515
2024	1,496		1.68	66		1.41	1		2.01	1,563
2023	1,332		1.86	33		1.38	1		1.17	1,366
2022	1,706		2.21	76		1.59	5		1.83	1,787
2021	2,208		3.66	37		1.70	26		4.36	2,271
2020 and prior	9,098		2.53	46		1.38	27		1.94	9,171
Total	$	17,162		$	440		$	71		$	17,673

We use loan performance status as the primary credit quality indicator for our residential mortgage loans on real estate. The amortized cost of residential mortgage loans on real estate (in millions) by year of origination and credit quality indicator was as follows:


	As of June 30, 2026
	Performing		Nonperforming		Total
Origination Year
2026	$	1,188	$	2	$	1,190
2025	1,698		16		1,714
2024	1,554		62		1,616
2023	389		20		409
2022	384		42		426
2021 and prior	536		27		563
Total	$	5,749	$	169	$	5,918


	As of December 31, 2025
	Performing		Nonperforming		Total
Origination Year
2025	$	1,650	$	4	$	1,654
2024	1,776		64		1,840
2023	440		21		461
2022	425		33		458
2021	381		14		395
2020 and prior	194		12		206
Total	$	4,866	$	148	$	5,014

In connection with our recognition of an allowance for credit losses for mortgage loans on real estate, we perform a quantitative analysis using a probability of default/loss given default/exposure at default approach to estimate expected credit losses in our mortgage loan portfolio as well as unfunded commitments related to commercial mortgage loans, exclusive of certain mortgage loans held at fair value.


	As of or For the Three Months Ended June 30, 2026
	Commercial		Residential		Total
Balance as of beginning-of-period	$	116	$	64	$	180
Additions (reductions) from provision for credit loss
expense (1)	5		2		7
Additions from purchases of PCD mortgage loans on
real estate	–		–		–
Reductions for mortgage loans on real estate charged off	(10)		–		(10)
Balance as of end-of-period (2)	$	111	$	66	$	177


	As of or For the Six Months Ended June 30, 2026
	Commercial		Residential		Total
Balance as of beginning-of-year	$	113	$	69	$	182
Additions (reductions) from provision for credit loss
expense (1)	8		(3)		5
Additions from purchases of PCD mortgage loans on
real estate	–		–		–
Reductions for mortgage loans on real estate charged off	(10)		–		(10)
Balance as of end-of-period (2)	$	111	$	66	$	177


	As of or For the Three Months Ended June 30, 2025
	Commercial		Residential		Total
Balance as of beginning-of-period	$	98	$	56	$	154
Additions (reductions) from provision for credit loss
expense (1)	(1)		9		8
Additions from purchases of PCD mortgage loans on
real estate	–		–		–

Balance as of end-of-period (2)	$	97	$	65	$	162


	As of or For the Six Months Ended June 30, 2025
	Commercial		Residential		Total
Balance as of beginning-of-year	$	99	$	53	$	152
Additions (reductions) from provision for credit loss
expense (1)	(2)		12		10
Additions from purchases of PCD mortgage loans on
real estate	–		–		–

Balance as of end-of-period (2)	$	97	$	65	$	162

(1) We recognized $1 million and less than $1 million of credit loss benefit (expense) related to unfunded commitments for mortgage loans on real estate for the three months ended June 30, 2026 and 2025, respectively, and $1 million and less than $1 million for the six months ended June 30, 2026 and 2025, respectively.

As of June 30, 2026, and December 31, 2025, alternative investments included investments in 375 and 384 different partnerships, respectively, and represented approximately 3% of total investments. These amounts do not include alternative investments that support funds withheld and modified coinsurance reinsurance agreements where the investment results are passed directly to the reinsurers.

Details underlying credit loss benefit (expense) incurred as a result of impairments that were recognized in net income (loss) and included in realized gain (loss) on fixed maturity AFS securities (in millions) were as follows:


	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2026		2025		2026		2025










Credit Loss Benefit (Expense)
Fixed maturity AFS securities:
Corporate bonds	$	(11)	$	(21)	$	(20)	$	(30)
RMBS	–		1		–		2
CMBS	(3)		–		(3)		–
ABS	(18)		1		(34)		(19)
Total credit loss benefit (expense)	$	(32)	$	(19)	$	(57)	$	(47)

The carrying value of the payables for collateral on investments included on the Consolidated Balance Sheets and the fair value of the related investments or collateral (in millions) consisted of the following:


	As of June 30, 2026				As of December 31, 2025
	Carrying Value		Fair Value		Carrying Value		Fair Value
Collateral payable for derivative investments (1)	$	9,051	$	9,051	$	7,809	$	7,809
Securities pledged under securities lending agreements (2)	181		174		145		139


Total payables for collateral on investments	$	9,232	$	9,225	$	7,954	$	7,948

(1) We obtain collateral based upon contractual provisions with our counterparties. These agreements take into consideration the counterparties’ credit rating as compared to ours, the fair value of the derivative investments and specified thresholds that if exceeded result in the receipt of cash that is typically invested in cash and invested cash or fixed maturity AFS securities. This also includes interest payable on collateral. See Note 5 for additional information.

(2) Our pledged securities under securities lending agreements are included in fixed maturity AFS securities on the Consolidated Balance Sheets. We generally obtain collateral in an amount equal to 102% and 105% of the fair value of the domestic and foreign securities, respectively. We value collateral daily and obtain additional collateral when deemed appropriate. The cash received in our securities lending program is typically invested in cash and invested cash or fixed maturity AFS securities.

We have repurchase agreements through which we can obtain liquidity by pledging securities. The collateral requirements are generally 80% to 95% of the fair value of the securities, and our agreements with third parties contain contractual provisions to allow for additional collateral to be obtained when necessary. The cash received in our repurchase program is typically invested in fixed maturity AFS securities. Lincoln National Corporation guarantees the obligations of certain reinsurance subsidiaries under certain repurchase agreements. As of June 30, 2026 and December 31, 2025, we were not participating in any open repurchase agreements.


	For the Six Months Ended June 30,
	2026		2025
Collateral payable for derivative investments	$	1,242	$	(2,210)
Securities pledged under securities
lending agreements	36		(2)
Securities pledged under repurchase agreements	–		418
Investments pledged for FHLB lending program	–		240
Total increase (decrease) in payables for
collateral on investments	$	1,278	$	(1,554)

We have elected not to offset our securities lending transactions in the consolidated financial statements. The remaining contractual maturities of securities lending transactions accounted for as secured borrowings (in millions) were as follows:


	As of June 30, 2026
	Overnight and Continuous		Up to 30 Days		30-90 Days		Greater Than 90 Days		Total


Securities Lending
Corporate bonds	$	175	$	–	$	–	$	–	$	175

Foreign government bonds	5		–		–		–		5
Equity securities	1		–		–		–		1
Total gross secured borrowings	$	181	$	–	$	–	$	–	$	181


	As of December 31, 2025
	Overnight and Continuous		Up to 30 Days		30-90 Days		Greater Than 90 Days		Total
Securities Lending
Corporate bonds	$	130	$	–	$	–	$	–	$	130
Foreign government bonds	5		–		–		–		5
Equity securities	10		–		–		–		10
Total gross secured borrowings	$	145	$	–	$	–	$	–	$	145

We accept collateral in the form of securities in connection with repurchase agreements. In instances where we are permitted to sell or re-pledge the securities received, we report the fair value of the collateral received and a related obligation to return the collateral in the consolidated financial statements. In addition, we receive securities in connection with securities borrowing agreements that we are permitted to sell or re-pledge. As of June 30, 2026, we had not received any collateral and, therefore, had not sold or repledged any collateral under these agreements.

We also accept collateral from derivative counterparties in the form of securities that we are permitted to sell or re-pledge. As of June 30, 2026, the fair value of this collateral received that we are permitted to sell or re-pledge was $2.2 billion, and we had re-pledged $59 million of this collateral to cover our collateral requirements.

We pledge assets as collateral in connection with derivative, securities lending and repurchase agreements, funding agreements issued pursuant to funding agreement backed repurchase agreements (“FABRs”), membership obligations with the Federal Home Loan Bank (“FHLB”) and regulatory deposits. See “Payables for Collateral on Investments” above and “Funding Agreements – FABR Funding


	As of June 30, 2026		As of December 31, 2025
Fixed maturity AFS securities	$	4,040	$	3,578
Trading securities	13		14
Equity securities	1		10
Mortgage loans on real estate	1,592		1,217
Other investments	74		71
Cash and invested cash	53		65
Total assets pledged as collateral	$	5,773	$	4,955

As of June 30, 2026, our investment commitments were $4.3 billion, which included $3.0 billion of limited partnerships (“LPs”), $703 million of mortgage loans on real estate, $400 million of asset-backed variable interest entities (“VIEs”) and $224 million of private placement securities.

As of June 30, 2026, our most significant investments in one issuer were our investments in securities issued by the U.S. Treasury and the Federal National Mortgage Association with a fair value of $943 million and $902 million, respectively, or 1% of total investments. As of December 31, 2025, our most significant investments in one issuer were our investments in securities issued by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation with a fair value of $951 million and $595 million, respectively, or 1% and less than 1% of total investments, respectively.