Investments

6 Months Ended

Jun. 30, 2026

Investments, Debt and Equity Securities [Abstract]

Investments consist primarily of fixed-income securities and loans, principally publicly-traded corporate and government bonds, asset-backed securities and mortgage loans. Asset-backed securities include mortgage-backed and other structured securities. The Company generates the majority of its general account deposits from interest-sensitive individual annuity contracts, life insurance products and institutional products on which it has committed to pay a declared rate of interest. The Company's strategy of investing in fixed-income securities and loans seeks to match the asset yield with the amounts credited to the interest-sensitive liabilities and to earn a stable return on its investments.

Long-term Strategic Partnership with TPG

During the first quarter of 2026, Jackson entered a long-term strategic partnership with TPG, combining Jackson’s annuity product expertise and broad distribution network with TPG’s private credit platform. The partnership aims to expand Jackson’s spread-based product sales.

At the closing in February 2026, subsidiaries and affiliates of Jackson Financial and TPG entered into non-exclusive investment management arrangements with a 10-year initial term with automatic one-year renewals through year 15 (subject to various termination rights), with TPG providing Investment Grade Asset-Based Finance and Direct Lending investment capabilities to complement the asset management capabilities of PPM America, Inc. ("PPM"), a Jackson Financial subsidiary. The arrangement contemplates certain target AUM levels over time and related investment management fees (including a baseline minimum fee payment), subject to exceptions, that the Company is committed to pay during the term of the arrangements and any applicable wind-down period. PPM continues to manage the majority of Jackson’s general account and both Jackson and PPM retain oversight of Jackson’s investment portfolio.

TPG also acquired a $500 million equity stake in Jackson Financial. See Note 19 - Equity of these Notes to Condensed Consolidated Financial Statements for more information regarding the shares issued to TPG. Additionally, TPG issued to a wholly-owned, indirect subsidiary of Jackson Financial $150 million in TPG common shares, which was reported in equity securities, at fair value on the Condensed Consolidated Balance Sheets. Under the terms of the transaction, TPG and Jackson Financial have agreed to certain limitations on their ability to divest their respective ownership stakes over time.

Debt Securities

The following table sets forth the composition of the fair value of debt securities at June 30, 2026, and December 31, 2025, classified by rating categories as assigned by a nationally recognized statistical rating organization (a “rating agency”), National Association of Insurance Commissioners (the “NAIC”) or, if not rated by such organizations, the Company’s investment advisors. The Company uses the second lowest rating by a rating agency when rating agencies' ratings are not equivalent and, for purposes of the table, if not otherwise rated by a rating agency, the NAIC rating of a security is converted to an equivalent rating agency rating. At June 30, 2026 and December 31, 2025, the carrying value of investments rated by the Company’s consolidated investment advisor totaled $893 million and $606 million, respectively.


	Percent of Total Debt Securities Carrying Value
	June 30, 2026	December 31, 2025
Investment Rating
U.S. government securities	6.2%	5.9%
AAA	4.6%	5.0%
AA	9.4%	9.5%
A	32.6%	32.2%
BBB	41.3%	40.9%
Investment grade	94.1%	93.5%
BB	2.3%	2.5%
B and below	3.6%	4.0%
Below investment grade	5.9%	6.5%
Total debt securities	100.0%	100.0%

At June 30, 2026 and December 31, 2025, the total carrying value of debt securities in an unrealized loss position consisted of:


	June 30, 2026	December 31, 2025
Investment grade securities	78%	78%
Below investment grade securities	1%	1%
Not rated securities	21%	21%

Unrealized losses on debt securities that were below investment grade or not rated were approximately 18% and 19% of the aggregate gross unrealized losses on available-for-sale debt securities at June 30, 2026 and December 31, 2025, respectively.

Corporate securities in an unrealized loss position were diversified across industries. As of June 30, 2026, the industries accounting for the largest percentage of unrealized losses included utility (19% of corporate gross unrealized losses) and healthcare (13%). The largest unrealized loss related to a single corporate obligor was $56 million at June 30, 2026. As of December 31, 2025, the industries accounting for the largest percentage of unrealized losses included utility (18% of corporate gross unrealized losses) and financial services (13%). The largest unrealized loss related to a single corporate obligor was $55 million at December 31, 2025.

At June 30, 2026 and December 31, 2025, the amortized cost, allowance for credit loss ("ACL"), gross unrealized gains and losses, and fair value of debt securities, including trading securities and securities carried at fair value under the fair value option, were as follows (in millions):


				Allowance		Gross		Gross
		Amortized		for		Unrealized		Unrealized		Fair
June 30, 2026		Cost (1)		Credit Loss		Gains		Losses		Value
	U.S. government securities	$	4,335	$	—	$	—	$	866	$	3,469
	Other government securities	1,288		—		8		184		1,112
	Public utilities	7,155		—		47		504		6,698
	Corporate securities	36,891		5		236		2,141		34,981
	Residential mortgage-backed	456		1		20		29		446
	Commercial mortgage-backed	2,087		—		4		62		2,029
	Other asset-backed securities	7,137		18		16		128		7,007
	Total debt securities	$	59,349	$	24	$	331	$	3,914	$	55,742

				Allowance		Gross		Gross
		Amortized		for		Unrealized		Unrealized		Fair
December 31, 2025		Cost (1)		Credit Loss		Gains		Losses		Value
	U.S. government securities	$	3,854	$	—	$	2	$	851	$	3,005
	Other government securities	1,254		—		4		193		1,065
	Public utilities	6,529		—		75		458		6,146
	Corporate securities	34,515		—		443		2,042		32,916
	Residential mortgage-backed	445		4		24		23		442
	Commercial mortgage-backed	1,873		—		10		54		1,829
	Other asset-backed securities	5,491		7		34		130		5,388
	Total debt securities	$	53,961	$	11	$	592	$	3,751	$	50,791

(1) Amortized cost, apart from the carrying value for securities carried at fair value under the fair value option and trading securities.

The amortized cost, ACL, gross unrealized gains and losses, and fair value of debt securities at June 30, 2026, by contractual maturity, are shown below (in millions). Actual maturities may differ from contractual maturities where securities can be called or prepaid with or without early redemption penalties.


			Allowance		Gross		Gross
	Amortized		for		Unrealized		Unrealized		Fair
	Cost (1)		Credit Loss		Gains		Losses		Value
Due in 1 year or less	$	2,396	$	—	$	2	$	7	$	2,391
Due after 1 year through 5 years	14,867		—		84		390		14,561
Due after 5 years through 10 years	14,854		—		136		362		14,628
Due after 10 years through 20 years	9,869		5		50		1,388		8,526
Due after 20 years	7,683		—		19		1,548		6,154
Residential mortgage-backed	456		1		20		29		446
Commercial mortgage-backed	2,087		—		4		62		2,029
Other asset-backed securities	7,137		18		16		128		7,007
Total	$	59,349	$	24	$	331	$	3,914	$	55,742

(1) Amortized cost, apart from the carrying value for securities carried at fair value under the fair value option and trading securities.

As required by law in various states in which business is conducted, securities with a carrying value of $56 million and $57 million at June 30, 2026 and December 31, 2025, respectively, were on deposit with regulatory authorities.

Residential mortgage-backed securities (“RMBS”) include certain RMBS that are collateralized by residential mortgage loans and are neither expressly nor implicitly guaranteed by U.S. government agencies (“non-agency RMBS”). The Company’s non-agency RMBS include investments in securities backed by prime, Alt-A, and subprime loans, as follows (in millions):


			Allowance		Gross		Gross
	Amortized		for		Unrealized		Unrealized		Fair
June 30, 2026	Cost (1)		Credit Loss		Gains		Losses		Value
Prime	$	250	$	1	$	2	$	16	$	235
Alt-A	18		—		13		4		27
Subprime	37		—		4		—		41
Total non-agency RMBS	$	305	$	1	$	19	$	20	$	303

			Allowance		Gross		Gross
	Amortized		for		Unrealized		Unrealized		Fair
December 31, 2025	Cost (1)		Credit Loss		Gains		Losses		Value
Prime	$	280	$	2	$	3	$	13	$	268
Alt-A	23		2		16		2		35
Subprime	7		—		4		—		11
Total non-agency RMBS	$	310	$	4	$	23	$	15	$	314


(1) Amortized cost, apart from carrying value for securities carried at fair value under the fair value option and trading securities.

The Company defines its exposure to non-agency RMBS as follows:

•Prime loan-backed securities are collateralized by mortgage loans made to the highest rated borrowers;

•Alt-A loan-backed securities are collateralized by mortgage loans made to borrowers who lack credit documentation or necessary requirements to obtain prime borrower rates; and

•Subprime loan-backed securities are collateralized by mortgage loans made to borrowers with a FICO score of 660 or lower.

Unrealized Losses on Debt Securities

For debt securities in an unrealized loss position, management first assesses whether the Company has the intent to sell, or whether it is more likely than not it will be required to sell, the security before the amortized cost basis is fully recovered. If either criterion is met, the amortized cost is written down to fair value through net gains (losses) on derivatives and investments as an impairment. If neither criterion is met, the securities are further evaluated to determine if the cause of the decline in fair value resulted from credit losses or other factors, such as estimates about issuer operations and future earnings potential.

There are inherent uncertainties in assessing the fair values assigned to the Company’s investments. The Company’s reviews of net present value and fair value involve several criteria including economic conditions, credit loss experience, other issuer-specific developments and estimated future cash flows. These assessments are based on the best available information at the time. Factors such as market liquidity, the widening of bid/ask spreads and a change in cash flow assumptions can contribute to future price volatility. If actual experience differs negatively from the assumptions and other considerations used in the Condensed Consolidated Financial Statements, unrealized losses currently reported in accumulated other comprehensive income (loss) may be recognized in the consolidated income statements in future periods.

The Company currently has no intent to sell securities with unrealized losses considered to be temporary until they mature or recover in value and believes that it has the ability to do so. However, if the specific facts and circumstances surrounding an individual security, or the outlook for its industry sector change, the Company may sell the security prior to its maturity or recovery and realize a loss.

When all, or a portion, of a security is deemed uncollectible, the uncollectible portion is written off with an adjustment to amortized cost and a corresponding reduction to the allowance for credit losses.

Accrued interest receivables are presented separate from the amortized cost basis of debt securities. Accrued interest receivables that are determined to be uncollectible are written off with a corresponding reduction to net investment income. Accrued interest written off was $2 million and $3 million for the three and six months ended June 30, 2026, and $1 million for the three and six months ended June 30, 2025.

The following table summarizes the gross unrealized losses of debt securities, fair value, and number of securities, aggregated by investment category and length of time that individual debt securities have been in a continuous loss position (dollars in millions):


	June 30, 2026					December 31, 2025
	Less than 12 months					Less than 12 months
	Gross		Fair Value			Gross		Fair Value
	Unrealized				# of	Unrealized				# of
	Losses				securities	Losses				securities
U.S. government securities	$	5	$	365	28	$	2	$	68	16
Other government securities	2		97		27	1		48		7
Public utilities	20		1,458		146	7		419		44
Corporate securities	127		9,619		966	44		2,300		240
Residential mortgage-backed	8		138		73	2		43		21
Commercial mortgage-backed	6		660		79	2		163		30
Other asset-backed securities	26		2,474		175	16		673		69
Total temporarily impaired securities	$	194	$	14,811	1,494	$	74	$	3,714	427

	12 months or longer					12 months or longer
	Gross		Fair Value			Gross		Fair Value
	Unrealized				# of	Unrealized				# of
	Losses				securities	Losses				securities
U.S. government securities	$	861	$	2,239	20	$	849	$	2,263	20
Other government securities	182		777		97	192		887		107
Public utilities	484		3,176		390	451		3,383		415
Corporate securities	2,014		10,601		1,361	1,998		12,130		1,502
Residential mortgage-backed	21		134		145	21		172		166
Commercial mortgage-backed	56		739		109	52		801		117
Other asset-backed securities	102		1,083		135	114		1,249		147
Total temporarily impaired securities	$	3,720	$	18,749	2,257	$	3,677	$	20,885	2,474

	Total					Total
	Gross					Gross
	Unrealized		Fair		# of	Unrealized		Fair		# of
	Losses		Value		securities (1)	Losses		Value		securities (1)
U.S. government securities	$	866	$	2,604	43	$	851	$	2,331	31
Other government securities	184		874		122	193		935		113
Public utilities	504		4,634		520	458		3,802		454
Corporate securities	2,141		20,220		2,224	2,042		14,430		1,706
Residential mortgage-backed	29		272		217	23		215		187
Commercial mortgage-backed	62		1,399		180	54		964		146
Other asset-backed securities	128		3,557		306	130		1,922		211
Total temporarily impaired securities	$	3,914	$	33,560	3,612	$	3,751	$	24,599	2,848

(1) Certain securities contain multiple lots and fit the criteria of both aging groups.

Debt securities in an unrealized loss position as of June 30, 2026, did not require an impairment recognized in earnings as (i) the Company did not intend to sell these debt securities, (ii) it is not more likely than not that the Company will be required to sell these 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, the Company believes it has the ability to generate adequate amounts of cash from normal operations to meet cash requirements with a reasonable margin of safety without requiring the sale of these securities.

As of June 30, 2026, unrealized losses associated with debt securities are primarily due to widening credit spreads or rising risk-free rates since purchase. As described below, the Company performed analyses of the financial performance of the underlying issues in an unrealized loss position and believes that recovery of the entire amortized cost of each such security is expected.

Evaluation of Available-for-Sale Debt Securities for Credit Loss

The credit loss evaluation for a debt security may consider one or more of the following:

•the extent to which the fair value is below amortized cost;

•changes in ratings;

•whether a significant covenant has been breached;

•assessments of the issuer’s ability to make scheduled debt payments based upon judgments related to its current and projected financial position, including whether it has filed or indicated a possibility of filing for bankruptcy, has missed or announced it intends to miss a scheduled debt service payment, or has experienced a specific material adverse change that may impair its creditworthiness;

•the existence of, and realizable value of, any collateral backing the obligations;

•the macro-economic and micro-economic outlooks for the issuer and its industry;

•for asset-backed securities: includes an assessment of future estimated cash flows under expected and stress case scenarios to identify potential shortfalls in contractual payments. These estimated cash flows are developed using available performance indicators from the underlying assets, such as current and projected default or delinquency rates, levels of credit enhancement, current subordination levels, vintage, expected loss severity and other relevant characteristics; and

•for mortgage-backed securities, credit losses are assessed using a cash flow model that estimates the cash flows on the underlying mortgages, using the security-specific collateral characteristics and transaction structure. The model estimates cash flows from the underlying mortgage loans and distributes those cash flows to various tranches of securities based on the transaction structure and any existing subordination and credit enhancements. The cash flow model incorporates actual cash flows on the mortgage-backed securities through the current period and then projects the remaining cash flows using a number of assumptions, including prepayment timing, default rates and loss severity. Specifically, for prime and Alt-A RMBS, the assumed default percentage is dependent on the severity of delinquency status, with foreclosures and real estate owned receiving higher rates, but also includes the currently performing loans.

These estimates reflect a combination of data derived by third parties and internally developed assumptions. Where possible, this data is benchmarked against other third-party sources. In addition, these estimates are extrapolated along a default timing curve to estimate the total lifetime pool default rate. When a credit loss is determined to exist and the present value of cash flows expected to be collected is less than the amortized cost of the security, an allowance for credit loss is recorded along with a charge to net gains (losses) on derivatives and investments, limited by the amount that the fair value is less than amortized cost. Any remaining unrealized loss after recording the allowance for credit loss is the non-credit amount and is recorded to other comprehensive income.

The allowance for credit loss for specific debt securities may be increased or reversed in subsequent periods due to changes in the assessment of the present value of cash flows that are expected to be collected. Any changes to the allowance for credit loss are recorded as a provision for (or reversal of) credit loss expense in net gains (losses) on derivatives and investments.

The roll-forward of the allowance for credit loss for available-for-sale securities by sector is as follows (in millions):


Three Months Ended June 30, 2026	US government securities		Other government securities		Public utilities		Corporate securities		Residential mortgage-backed		Commercial mortgage-backed		Other asset-backed securities		Total
Balance at April 1, 2026	$	—	$	—	$	—	$	6	$	1	$	—	$	10	$	17
Additions for which credit loss was not previously recorded	—		—		—		—		—		—		—		—
Changes for securities with previously recorded credit loss	—		—		—		(1)		—		—		8		7
Additions for purchases of PCD debt securities (1)	—		—		—		—		—		—		—		—
Reductions from charge-offs	—		—		—		—		—		—		—		—
Reductions for securities disposed	—		—		—		—		—		—		—		—
Securities intended/required to be sold before recovery of amortized cost basis	—		—		—		—		—		—		—		—
Balance at June 30, 2026 (2)	$	—	$	—	$	—	$	5	$	1	$	—	$	18	$	24


Three Months Ended June 30, 2025	US government securities		Other government securities		Public utilities		Corporate securities		Residential mortgage-backed		Commercial mortgage-backed		Other asset-backed securities		Total
Balance at April 1, 2025	$	—	$	—	$	—	$	8	$	6	$	—	$	26	$	40
Additions for which credit loss was not previously recorded	—		—		—		—		—		—		—		—
Changes for securities with previously recorded credit loss	—		—		—		—		—		—		27		27
Additions for purchases of PCD debt securities (1)	—		—		—		—		—		—		—		—
Reductions from charge-offs	—		—		—		—		—		—		(53)		(53)
Reductions for securities disposed	—		—		—		—		(2)		—		—		(2)
Securities intended/required to be sold before recovery of amortized cost basis	—		—		—		—		—		—		—		—
Balance at June 30, 2025 (2)	$	—	$	—	$	—	$	8	$	4	$	—	$	—	$	12


Six Months Ended June 30, 2026	US government securities		Other government securities		Public utilities		Corporate securities		Residential mortgage-backed		Commercial mortgage-backed		Other asset-backed securities		Total
Balance at January 1, 2026	$	—	$	—	$	—	$	—	$	4	$	—	$	7	$	11
Additions for which credit loss was not previously recorded	—		—		—		6		—		—		—		6
Changes for securities with previously recorded credit loss	—		—		—		(1)		(1)		—		36		34
Additions for purchases of PCD debt securities (1)	—		—		—		—		—		—		—		—
Reductions from charge-offs	—		—		—		—		—		—		(18)		(18)
Reductions for securities disposed	—		—		—		—		(2)		—		(7)		(9)
Securities intended/required to be sold before recovery of amortized cost basis	—		—		—		—		—		—		—		—
Balance at June 30, 2026 (2)	$	—	$	—	$	—	$	5	$	1	$	—	$	18	$	24


Six Months Ended June 30, 2025	US government securities		Other government securities		Public utilities		Corporate securities		Residential mortgage-backed		Commercial mortgage-backed		Other asset-backed securities		Total
Balance at January 1, 2025	$	—	$	—	$	—	$	8	$	6	$	—	$	25	$	39
Additions for which credit loss was not previously recorded	—		—		—		—		—		1		—		1
Changes for securities with previously recorded credit loss	—		—		—		—		—		—		28		28
Additions for purchases of PCD debt securities (1)	—		—		—		—		—		—		—		—
Reductions from charge-offs	—		—		—		—		—		—		(53)		(53)
Reductions for securities disposed	—		—		—		—		(2)		—		—		(2)
Securities intended/required to be sold before recovery of amortized cost basis	—		—		—		—		—		(1)		—		(1)
Balance at June 30, 2025 (2)	$	—	$	—	$	—	$	8	$	4	$	—	$	—	$	12


(1) Represents purchased credit-deteriorated ("PCD") fixed maturity available-for-sale securities.
(2) Accrued interest receivable on debt securities totaled $564 million and $469 million as of June 30, 2026 and 2025, respectively, and was excluded from the determination of credit losses for the three and six months ended June 30, 2026 and 2025.

Net Investment Income

The sources of net investment income were as follows (in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Debt securities (1)	$	618	$	415	$	1,090	$	846
Equity securities (2)	8		5		(51)		6
Mortgage loans	104		88		203		171
Policy loans	14		16		30		33
Limited partnerships	28		22		47		60
Other investment income	58		54		115		106
Total investment income excluding funds withheld assets	830		600		1,434		1,222
Investment expenses (3)	(103)		(109)		(166)		(203)
Net investment income excluding funds withheld assets	727		491		1,268		1,019
Net investment income on funds withheld assets (see Note 8)	201		227		400		454
Net investment income	$	928	$	718	$	1,668	$	1,473

(1) Includes changes in fair value gains (losses) on trading securities and includes $26 million and $(46) million for the three and six months ended June 30, 2026, respectively, and $(64) million and $(74) million for the three and six months ended June 30, 2025, respectively, related to the change in fair value for securities carried under the fair value option.

(2) Includes changes in fair value of TPG common stock. See discussion above on our Long-term Strategic Partnership with TPG.

(3) Includes expenses from consolidated variable interest entities, which includes changes in fair value of notes issued by those entities, of $(56) million and $(72) million for the three and six months ended June 30, 2026, respectively, and $(42) million and $(74) million for the three and six months ended June 30, 2025, respectively.

Unrealized gains (losses) included in investment income that were recognized on equity securities held were $6 million and $4 million for the three months ended June 30, 2026 and 2025, respectively, and $(58) million and $2 million for the six months ended June 30, 2026 and 2025, respectively.

Net Gains (Losses) on Derivatives and Investments

The following table summarizes net gains (losses) on derivatives and investments (in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Available-for-sale securities
Realized gains on sale	$	4	$	4	$	11	$	7
Realized losses on sale	(10)		(11)		(19)		(23)
Credit loss income (expense)	(8)		—		(16)		—
Credit loss income (expense) on mortgage loans	(20)		(10)		(46)		(21)
Other (1)	13		(92)		2		(138)
Net gains (losses) excluding derivatives and funds withheld assets	(21)		(109)		(68)		(175)
Net gains (losses) on derivative instruments (see Note 5)	(2,466)		(2,751)		(2,136)		(1,342)
Net gains (losses) on derivatives and investments	(2,487)		(2,860)		(2,204)		(1,517)

Net gains (losses) on funds withheld reinsurance treaties (see Note 8)	(297)		(327)		(456)		(715)
Total net gains (losses) on derivatives and investments	$	(2,784)	$	(3,187)	$	(2,660)	$	(2,232)

(1) Includes the foreign currency gain or loss related to foreign denominated trust instruments supporting funding agreements.

Net gains (losses) on funds withheld reinsurance treaties represents income (loss) from the sale of investments held in segregated funds withheld accounts in support of reinsurance agreements for which Jackson retains legal ownership of the underlying investments. These gains (losses) are increased or decreased by:

•changes in the embedded derivative liability related to the Athene Life Re Ltd. ("Athene") funds withheld coinsurance agreement (the “Athene Reinsurance Transaction”),

•changes in the related funds withheld payable, as all economic performance of the investments held in the segregated accounts inure to the benefit of the reinsurers under the respective reinsurance agreements, and

•amortization of the difference between book value and fair value of the investments as of the effective date of the reinsurance agreements.

The aggregate fair value of securities sold at a loss for the three and six months ended June 30, 2026 was $935 million and $1.2 billion, which was approximately 94% and 94% of book value, respectively. The aggregate fair value of securities sold at a loss for the three and six months ended June 30, 2025 was $589 million and $1.3 billion, which was approximately 95% and 95% of book value, respectively.

Proceeds from sales of available-for-sale debt securities were $1.2 billion and $1.8 billion during the three and six months ended June 30, 2026, respectively, and $849 million and $1.8 billion during the three and six months ended June 30, 2025, respectively.

Consolidated Variable Interest Entities ("VIEs")

The Company concluded that the following entities are VIEs and that the Company is the primary beneficiary as it has both the power to direct the most significant activities of the VIE and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. In each case, the Company’s exposure to loss is limited to the capital invested plus unfunded capital commitments. Creditors of the consolidated VIEs do not have recourse to the general credit of the Company:

•The Company funds affiliated LLCs to facilitate the issuance of collateralized loan obligations ("CLOs"). These LLCs are consolidated on a one-month lag due to the timing of when information is available from the VIE.

•Private Equity Funds VIII – IX and Strategic Opportunity Fund I are limited partnership structures that invest the ownership capital in portfolios of various other limited partnership structures. Private Equity Fund IX was funded in August 2025 and Strategic Opportunity Fund I was funded in June 2025. The consolidation of Private Equity Fund IX and Strategic Opportunity Fund I are on a one-quarter lag due to the timing of when information is available from the VIE.

•PPM Investment Grade Private Credit Fund is a private fund organized as a series of a Delaware LLC that invests primarily in fixed rate, privately issued, investment grade instruments. The series was funded in January 2026. This fund is consolidated on a one-month lag due to the timing of when information is available from the VIE.

•Panther Investments I, LP was funded in May 2026. The Fund is a rated note feeder fund that utilizes a master fund limited partnership to invest primarily in secured loans to North American lower middle market companies. This Fund is consolidated on a one-quarter lag due to the timing of when information is available from the VIE.

Asset and liability information for the consolidated VIEs included on the Condensed Consolidated Balance Sheets is as follows (in millions):


	June 30, 2026		December 31, 2025
Assets
Debt securities, at fair value under fair value option	$	2,648	$	2,698

Equity securities	9		6
Other invested assets	1,255		979
Cash and cash equivalents	114		154
Other assets	43		51
Total assets	$	4,069	$	3,888

Liabilities
Notes issued by consolidated VIEs, at fair value under fair value option	$	2,474	$	2,578
Other liabilities	184		258
Total other liabilities	2,658		2,836

Total liabilities	$	2,658	$	2,836

Equity
Noncontrolling interests	$	512	$	389

Unconsolidated VIEs

The Company has concluded the following entities are VIEs but does not consolidate them. Based on analysis of the limited partnerships ("LPs"), LLCs and the mutual funds, the Company is not the primary beneficiary of each VIE because the Company lacks the power to direct the activities of the VIE that most significantly impact the VIE's performance or lacks the obligation to absorb losses or the right to receive benefits that could potentially be significant to the entities, or lacks both.

•The carrying amounts of the Company’s investments in certain LPs and LLCs are recognized in other invested assets on the Condensed Consolidated Balance Sheets. Unfunded capital commitments for these investments are detailed in Note 16 of these Notes to Condensed Consolidated Financial Statements. The Company’s exposure to loss was limited to $3,036 million and $2,709 million as of June 30, 2026 and December 31, 2025, respectively, representing the aggregate capital invested and unfunded capital commitments related to the LPs and LLCs at those dates. The capital invested in an LP or LLC equals the original capital contributed, increased for additional capital contributed after the initial investment, and reduced for any returns of capital from the LP or LLC. LPs and LLCs are carried at fair value.

•The Company's investments in certain mutual funds are recognized in equity securities on the Condensed Consolidated Balance Sheets and were $51 million and $21 million as of June 30, 2026 and December 31, 2025, respectively. The Company’s maximum exposure to loss on these mutual funds is limited to the amortized cost for these investments.

The Company makes investments in structured debt securities issued by VIEs for which it is not the manager. These structured debt securities include RMBS, Commercial Mortgage-Backed Securities ("CMBS"), and Asset-Backed Securities ("ABS"). The Company does not consolidate the securitization trusts utilized in these transactions because it does not have the power to direct the activities that most significantly impact the economic performance of these securitization trusts. The Company does not consider its continuing involvement with these VIEs to be significant because it either invests in securities issued by the VIE and was not involved in the design of the VIE or no transfers have occurred between the Company and the VIE. The Company’s maximum exposure to loss on these structured debt securities is limited to the amortized cost of these investments. The Company does not have any further contractual obligations to the VIE. The Company recognizes the variable interest in these VIEs at fair value on the Condensed Consolidated Balance Sheets.

Commercial and Residential Mortgage Loans

The following table shows commercial mortgage loans, residential mortgage loans, and the respective accrued interest thereon (in millions):


	June 30, 2026		December 31, 2025
Commercial mortgage loans (1)	$	9,538	$	8,957
Accrued interest receivable on commercial mortgage loans	38		34
Residential mortgage loans (2)	1,471		1,254
Accrued interest receivable on residential mortgage loans	14		13

(1) Net of an allowance for credit losses of $157 million and $117 million at each date, respectively.

(2) Net of an allowance for credit losses of $19 million and $16 million at each date, respectively.

At June 30, 2026, commercial mortgage loans were collateralized by properties located in 36 states, the District of Columbia, and Europe, while residential mortgage loans were collateralized by properties located in 48 states, the District of Columbia, Mexico, and Europe.

Evaluation for Credit Losses on Mortgage Loans

The Company reviews mortgage loans that are not carried at fair value under the fair value option on a quarterly basis to estimate the ACL with changes in the ACL recorded in net gains (losses) on derivatives and investments. Apart from an ACL recorded on individual mortgage loans where the borrower is experiencing financial difficulties, the Company records an ACL on the pool of mortgage loans based on lifetime expected credit losses. The Company utilizes a third-party forecasting model to estimate lifetime expected credit losses at a loan level for mortgage loans. The model forecasts net operating income and property values for the economic scenario selected. The debt service coverage ratios (“DSCR”) and loan to values (“LTV”) are calculated over the forecastable period by comparing the projected net operating income and property valuations to the loan payment and principal amounts of each loan. The model utilizes historical mortgage loan performance based on DSCRs and LTV to derive probability of default and expected losses based on the economic scenario that is similar to the Company’s expectations of economic factors such as unemployment, gross domestic product growth, and interest rates. The Company determined the forecastable period to be reasonable and supportable for a period of two years beyond the end of the reporting period. Over the following one-year period, the model reverts to the historical performance of the portfolio for the remainder of the contractual term of the loans. In cases where the Company does not have an appropriate length of historical performance, the relevant historical rate from an index or the lifetime expected credit loss calculated from the model may be used.

Unfunded commitments are included in the model and an ACL is determined accordingly. Credit loss estimates are pooled by property type and the Company does not include accrued interest in the determination of ACL.

For individual loans or for types of loans for which the third-party model is deemed not suitable, the Company utilizes relevant current market data, industry data, and publicly available historical loss rates to calculate an estimate of the lifetime expected credit loss.

Mortgage loans on real estate deemed uncollectible are charged against the ACL, and subsequent recoveries, if any, are credited to the ACL, limited to the aggregate of amounts previously charged-off and expected to be charged-off. Mortgage loans on real estate are presented net of the ACL on the Condensed Consolidated Balance Sheets.

The following table provides the change in the allowance for credit losses in the Company’s mortgage loan portfolios (in millions):


Three Months Ended June 30, 2026	Apartment		Hotel		Office		Retail		Warehouse		Other		Residential Mortgage		Total
Balance at April 1, 2026	$	23	$	4	$	56	$	30	$	23	$	1	$	22	$	159
Charge offs, net of recoveries	—		—		(5)		—		—		—		—		(5)
Reductions for mortgages disposed	—		—		—		—		—		—		—		—
Additions from purchase of PCD mortgage loans	—		—		—		—		—		—		—		—
Provision (release)	27		11		(20)		(4)		10		1		(3)		22
Balance at June 30, 2026 (1) (2)	$	50	$	15	$	31	$	26	$	33	$	2	$	19	$	176


Three Months Ended June 30, 2025	Apartment		Hotel		Office		Retail		Warehouse		Other		Residential Mortgage		Total
Balance at April 1, 2025	$	28	$	7	$	40	$	19	$	20	$	2	$	14	$	130
Charge offs, net of recoveries	—		—		—		—		—		—		—		—
Reductions for mortgages disposed	(1)		—		—		(1)		—		—		—		(2)
Additions from purchase of PCD mortgage loans	—		—		—		—		—		—		—		—
Provision (release)	(9)		3		2		6		6		—		1		9
Balance at June 30, 2025 (1) (2)	$	18	$	10	$	42	$	24	$	26	$	2	$	15	$	137


Six Months Ended June 30, 2026	Apartment		Hotel		Office		Retail		Warehouse		Other		Residential Mortgage		Total
Balance at January 1, 2026	$	32	$	11	$	28	$	17	$	27	$	2	$	16	$	133
Charge offs, net of recoveries	(1)		—		(9)		—		—		—		—		(10)
Reductions for mortgages disposed	—		—		—		—		—		—		—		—
Additions from purchase of PCD mortgage loans	—		—		—		—		—		—		—		—
Provision (release)	19		4		12		9		6		—		3		53
Balance at June 30, 2026 (1) (2)	$	50	$	15	$	31	$	26	$	33	$	2	$	19	$	176


Six Months Ended June 30, 2025	Apartment		Hotel		Office		Retail		Warehouse		Other		Residential Mortgage		Total
Balance at January 1, 2025	$	23	$	7	$	44	$	19	$	20	$	3	$	5	$	121
Charge offs, net of recoveries	—		—		(6)		—		—		—		—		(6)
Reductions for mortgages disposed	(1)		—		—		(1)		—		—		—		(2)
Additions from purchase of PCD mortgage loans	—		—		—		—		—		—		—		—
Provision (release)	(4)		3		4		6		6		(1)		10		24
Balance at June 30, 2026 (1) (2)	$	18	$	10	$	42	$	24	$	26	$	2	$	15	$	137

(1) Accrued interest receivable totaled $52 million and $43 million as of June 30, 2026 and 2025, respectively, and was excluded from the determination of credit losses.

(2) Accrued interest amounting to $1 million and $1 million was written off as of June 30, 2026 and 2025, respectively, relating to loans that were greater than 90 days delinquent or in the process of foreclosure.

The Company’s mortgage loans that are current and in good standing are accruing interest. Interest is not accrued on loans greater than 90 days delinquent and in process of foreclosure, when deemed uncollectible. Delinquency status is determined from the date of the first missed contractual payment.

The following table provides information about our residential mortgage loans in process of foreclosure (in millions):


	June 30, 2026		December 31, 2025
Recorded investment (1)	$	23	$	38
Unpaid principal balance	25		45
Related loan allowance	—		1
Average recorded investment	24		29
Investment income recognized	—		1

(1) At June 30, 2026 and December 31, 2025, includes $3 million and $4 million, respectively, of loans in process of foreclosure, all of which are loans supported with insurance or other guarantees provided by various governmental programs.

The following tables provide information about the credit quality with vintage year and category of mortgage loans (dollars in millions):


	June 30, 2026
	2026		2025		2024		2023		2022		Prior		Revolving Loans		Total		% of Total
Commercial mortgage loans
Loan to value ratios (1):
Less than 70%	$	668	$	1,461	$	560	$	466	$	407	$	4,434	$	—	$	7,996	84	%
70% - 80%	84		232		128		44		128		609		—		1,225		13	%
80% - 100%	—		—		—		25		25		121		—		171		2	%
Greater than 100%	—		—		3		—		55		88		—		146		1	%
Total commercial mortgage loans	752		1,693		691		535		615		5,252		—		9,538		100	%

Debt service coverage ratios (2):
Greater than 1.20x	718		1,344		648		429		479		4,560		—		8,178		86	%
1.00x - 1.20x	21		147		—		82		38		382		—		670		7	%
Less than 1.00x	12		155		39		16		89		309		—		620		6	%
Non-income producing properties	1		47		4		8		9		1		—		70		1	%
Total commercial mortgage loans	752		1,693		691		535		615		5,252		—		9,538		100	%

Residential mortgage loans
Performing	247		571		184		6		11		406		—		1,425		97	%
Nonperforming	—		1		4		7		7		27		—		46		3	%
Total residential mortgage loans	247		572		188		13		18		433		—		1,471		100	%

Total mortgage loans	$	999	$	2,265	$	879	$	548	$	633	$	5,685	$	—	$	11,009	100	%

(1) The loan to value ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan.

(2) The debt service coverage ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.


	December 31, 2025
	2025		2024		2023		2022		2021		Prior		Revolving Loans		Total		% of Total
Commercial mortgage loans
Loan to value ratios (1):
Less than 70%	$	1,140	$	508	$	521	$	466	$	345	$	4,296	$	—	$	7,276	81	%
70% - 80%	206		129		62		221		353		316		—		1,287		14	%
80% - 100%	—		—		25		46		24		151		—		246		3	%
Greater than 100%	—		2		—		56		—		90		—		148		2	%
Total commercial mortgage loans	1,346		639		608		789		722		4,853		—		8,957		100	%

Debt service coverage ratios (2):
Greater than 1.20x	1,313		615		538		594		434		4,591		—		8,085		90	%
1.00x - 1.20x	33		24		70		145		174		231		—		677		8	%
Less than 1.00x	—		—		—		50		114		31		—		195		2	%
Total commercial mortgage loans	1,346		639		608		789		722		4,853		—		8,957		100	%

Residential mortgage loans
Performing	487		223		17		17		71		375		—		1,190		95	%
Nonperforming	—		4		16		20		3		21		—		64		5	%
Total residential mortgage loans	487		227		33		37		74		396		—		1,254		100	%

Total mortgage loans	$	1,833	$	866	$	641	$	826	$	796	$	5,249	$	—	$	10,211	100	%

(2) The debt service coverage ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.


	Accruing Loans (1)
June 30, 2026	Current		30-89 Days Past Due (2)		90 Days or Greater Past Due (2)		Non-accrual Loans (1)		Total Loans (1)		Non-accrual Loans with No Allowance (1)		Interest Income on Non-accrual Loans
Apartment	$	3,315	$	3	$	—	$	14	$	3,332	$	—	$	—
Hotel	812		—		—		—		812		—		—
Office	1,118		10		—		84		1,212		—		—
Retail	1,650		—		—		—		1,650		—		—
Warehouse	2,266		—		—		—		2,266		—		—
Other	423		—		—		—		423		—		—
Total commercial	9,584		13		—		98		9,695		—		—
Residential (2)	1,394		47		—		49		1,490		—		—
Total	$	10,978	$	60	$	—	$	147	11,185		$	—	$	—
ACL									(176)
Total with ACL									$	11,009


	Accruing Loans (1)
December 31, 2025	Current		30-89 Days Past Due (2)		90 Days or Greater Past Due (2)		Non-accrual Loans (1)		Total Loans (1)		Non-accrual Loans with No Allowance (1)		Interest Income on Non-accrual Loans
Apartment	$	2,866	$	—	$	—	$	—	$	2,866	$	—	$	—
Hotel	789		—		—		—		789		—		—
Office	1,062		—		—		109		1,171		—		—
Retail	1,664		—		—		—		1,664		—		—
Warehouse	2,217		—		—		—		2,217		—		—
Other	367		—		—		—		367		—		—
Total commercial	8,965		—		—		109		9,074		—		—
Residential (2)	1,124		69		16		61		1,270		—		2
Total	$	10,089	$	69	$	16	$	170	$	10,344	$	—	$	2
ACL									(133)
Total with ACL									$	10,211

(1) Amortized cost or fair value for loans carried at fair value under the fair value option.

(2) At June 30, 2026 and December 31, 2025, includes $16 million and $19 million, respectively, of loans 30-89 days past due and $17 million and $16 million, respectively, of loans 90 days or greater past due and supported with insurance or other guarantees provided by various governmental programs.

The following table provides information about the mortgage loans modified during the periods indicated to borrowers experiencing financial difficulty (dollars in millions):

Term Extension

Amortized
Cost Basis

Percent of
Total Class

Three Months Ended June 30, 2026

Commercial mortgage loans

—

Three Months Ended June 30, 2025

Commercial mortgage loans

—


	Term Extension
	Amortized Cost Basis		Percent of Total Class
Six Months Ended June 30, 2026
Commercial mortgage loans	$	10	—	%

Six Months Ended June 30, 2025
Commercial mortgage loans	$	—	—	%

As of June 30, 2026, the above modified loans had $8 million of unfunded commitments.

The following table describes the financial effect of the modifications made to the loans noted above:


						Term Extension
						Financial Effect
Six Months Ended June 30, 2026
Commercial mortgage loans						Granted extension of term for 42 months and rate converted from variable to fixed.

The Company closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table depicts the performance of loans that have been modified in the last 12 months (in millions):


	Payment Status (Amortized Cost Basis)
	Current		30-89 Days Past Due		90+ Days Past Due
June 30, 2026
Commercial mortgage loans	$	—	$	10	$	—

June 30, 2025
Commercial mortgage loans	$	—	$	—	$	—

As of June 30, 2026 and 2025, stressed mortgage loans for which the Company is dependent, or expects to be dependent, on the underlying property to satisfy repayment were $19 million and $32 million, respectively.

Policy Loans

Policy loans are loans the Company issues to contract holders that use the cash surrender value of their life insurance policy or annuity contract as collateral. At June 30, 2026 and December 31, 2025, $3.6 billion and $3.5 billion of these loans were carried at fair value, which the Company believes is equal to unpaid principal balances, plus accrued investment income. At both June 30, 2026 and December 31, 2025, the Company had $0.9 billion of policy loans not held as collateral for reinsurance, which were carried at the unpaid principal balances.

Other Invested Assets

Other invested assets primarily include investments in:

•Federal Home Loan Bank of Indianapolis ("FHLBI") capital stock, which is carried at cost and adjusted for any impairment. At June 30, 2026 and December 31, 2025, FHLBI capital stock had a carrying value of $87 million and $119 million, respectively;

•limited partnerships (“LPs”), which are carried at values determined by using the proportion of the Company’s investment in each fund (Net Asset Value (“NAV”) equivalent) as a practical expedient for fair value, and generally are recorded on a three-month lag, with changes in value included in net investment income. At June 30, 2026 and December 31, 2025, investments in LPs had carrying values of $3.1 billion and $2.8 billion, respectively; and

•real estate, which is carried at the lower of depreciated cost or fair value and real estate occupied by the Company is carried at depreciated cost. At June 30, 2026 and December 31, 2025, real estate totaling $226 million and $230 million, respectively, included foreclosed properties with a book value of $19 million and $20 million at June 30, 2026 and December 31, 2025, respectively.

Securities Lending

The Company has entered into securities lending agreements with agent banks whereby blocks of securities are loaned to third parties, primarily major brokerage firms. As of June 30, 2026 and December 31, 2025, the estimated fair value of loaned securities was $74 million and $34 million, respectively. The agreements require a minimum of 102% of the fair value of the loaned securities to be held as collateral, calculated daily. To further minimize the credit risks related to these programs, the financial condition of counterparties is monitored on a regular basis. At June 30, 2026 and December 31, 2025, cash collateral received in the amount of $77 million and $35 million, respectively, was invested by the agent banks and included in cash and cash equivalents of the Company. A securities lending payable for the overnight and continuous loans is included in liabilities in the amount of cash collateral received. Securities lending transactions are used to generate income. Income and expenses associated with these transactions are reported as net investment income.

Repurchase Agreements

The Company routinely enters into repurchase agreements whereby the Company agrees to sell and repurchase securities. These agreements are accounted for as financing transactions, with the assets and associated liabilities included in the Condensed Consolidated Balance Sheets.

At June 30, 2026 and December 31, 2025, the outstanding repurchase agreement balance was $0.4 billion and $1.0 billion, respectively, having maturities within 30 days, and was included within repurchase agreements and securities lending payable in the Condensed Consolidated Balance Sheets. These repurchase agreements were collateralized with U.S. Treasury securities and corporate securities of $0.4 billion and $1.0 billion, respectively, at June 30, 2026 and December 31, 2025.

Interest expense totaled $1 million and $3 million for the three and six months ended June 30, 2026, respectively, and $16 million and $28 million for the three and six months ended June 30, 2025, respectively, and is included within net investment income.

Collateral Upgrade Transactions

During the first quarter of 2024, Jackson executed certain paired repurchase and reverse repurchase transactions totaling $1.5 billion pursuant to master repurchase agreements with participating bank counterparties. Under these transactions, the Company lends securities (e.g., corporate debt securities) to bank counterparties in exchange for U.S. Treasury securities that the Company then uses to provide as collateral. The paired repurchase and reverse repurchase transactions are settled on a net basis. As a result, there was no cash exchanged at initiation of these agreements. The paired transactions are reported net within the Condensed Consolidated Balance Sheets. These transactions are evergreen and require at least 150-days' notice prior to termination.

At both June 30, 2026 and December 31, 2025, the fair value of the U.S. treasuries received was $1.5 billion, collateralized with corporate securities with a fair value of $1.6 billion. Subsequently, the Company provided these U.S. Treasury securities as collateral for derivative trades, and they are included as part of the derivative collateral disclosures.

In the event of a decline in the fair value of the pledged collateral under these agreements, the Company may be required to transfer cash or additional securities as pledged collateral. Gross interest income of $14 million and $17 million and gross interest expense of $17 million and $19 million for the three months ended June 30, 2026 and 2025, respectively, and gross interest income of $28 million and $33 million and gross interest expense of $33 million and $38 million for the six months ended June 30, 2026 and 2025, respectively, are included within net investment income.