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RGA Q2 Earnings Beat Estimates on Higher Premiums, Investment Income
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Key Takeaways
RGA's beat Q2 earnings estimates on strong Financial Solutions growth and investment income.
RGA's revenue rose 18.5% as higher premiums and investment income offset expense and currency headwinds.
Financial Solutions delivered strong growth across regions, while book value and ROE improved year over year.
Reinsurance Group of America, Incorporated (RGA - Free Report) reported second-quarter 2026 adjusted operating earnings of $8.89 per share, which beat the Zacks Consensus Estimate by 36.6%. The bottom line rose 88.3% from the year-ago quarter.
RGA reported strong second-quarter results, driven by solid growth in Financial Solutions businesses across the United States, EMEA and the Asia/Pacific, along with higher investment income and premium growth. However, higher expenses and lower premiums in the United States and Latin America Traditional segment and foreign currency headwinds partially offset the strong performance.
Reinsurance Group of America, Incorporated Price, Consensus and EPS Surprise
RGA's operating revenues of $6.7 billion beat the Zacks Consensus Estimate by 1%. The top line improved 18.5% year over year on higher net investment income, net premiums and other revenues.
Net premiums of $4.5 billion increased 7.7% year over year and missed the Zacks Consensus Estimates by 4.2%.
Investment income improved 10.3% from the prior-year quarter to $1.8 billion and beat the Zacks Consensus Estimates by 13%. The increase was driven by a larger average invested asset base and higher earned yields. The average investment yield increased to 5.33% from 5.31% in the prior-year period, driven by higher variable investment income.
Total benefits and expenses increased 14.7% year over year to $6 billion, driven by higher claims and other policy benefits, interest credited, policy acquisition costs and other insurance expenses, and other operating expenses.
Quarterly Segmental Update
U.S. and Latin America: Total pre-tax adjusted operating income was $319 million, which increased 215.8% year over year.
The Traditional segment reported pre-tax adjusted operating income of $165 million, which rose from $4 million in the prior-year quarter. Net premiums declined 2.9% from the year-ago quarter to $2 billion.
The Financial Solutions segment’s pre-tax adjusted operating income increased 58.8% to $154 million.
Canada: Total pre-tax adjusted operating income rose 51.4% year over year to $56 million.
The Traditional segment delivered a 35.7% year-over-year increase in pre-tax adjusted operating income to $38 million. Net premiums grew 2.7% to $348 million. Foreign currency exchange rates had an immaterial effect on net premiums for the quarter.
The Financial Solutions segment’s pre-tax adjusted operating income doubled year over year to $18 million, benefiting from strong variable investment income.
EMEA: Total pre-tax adjusted operating income grew 28.4% to $172 million.
Pre-tax adjusted operating profit of the Traditional segment was $39 million, higher than the year-ago quarter’s profit of $18 million, driven by improved claims experience and favorable one-time items. Net premiums decreased 0.9% year over year to $568 million. Foreign currency exchange rates had a favorable effect on net premiums of $10 million for the quarter.
The Financial Solutions pre-tax adjusted operating income increased 14.7% year over year to $133 million, supported by new business and associated investment income.
Asia/Pacific: Total pre-tax adjusted operating income rose nearly 37.6% from the year-ago quarter’s level to $249 million.
The Traditional segment’s pre-tax adjusted operating income rose 24% year over year to $129 million, including a $2 million unfavorable impact from foreign currency exchange rates. Premiums increased 4.2% to $850 million, benefiting from new business growth. Foreign currency exchange rates had an unfavorable effect on net premiums of $4 million for the quarter.
The Financial Solutions segment’s pre-tax adjusted operating income increased 55.8% to $120 million. Foreign currency exchange rates had an immaterial impact of $7 million on adjusted operating income before taxes.
Corporate and Other: Pre-tax adjusted operating loss widened slightly to $35 million from a loss of $32 million in the year-ago quarter.
RGA’s Financial Update
As of June 30, 2026, total assets were $167 billion, up 6.7% from the 2025-end level.
Book value per share, excluding accumulated other comprehensive income, increased 11.5% to $173.77 from the 2025-end level.
Adjusted operating return on equity was 17.4%, representing a 470-basis-point year-over-year increase.
RGA’s Capital Deployment
Reinsurance Group returned $111 million to shareholders in the second quarter, including $50 million of share repurchases and $61 million in dividends.
The company’s board of directors declared a quarterly dividend of 98 cents, to be paid out on Sept 1, 2026, to shareholders of record as of Aug 18, 2026.
Voya Financial, Inc. (VOYA - Free Report) reported second-quarter 2026 adjusted operating earnings of $1.51 per share, missing the Zacks Consensus Estimate of $1.88 by 19.7%. The bottom line declined 38.6% year over year. Revenues of $269 million missed the consensus mark by 4.6%.
After-tax adjusted operating earnings fell to $140 million from $240 million in the year-ago quarter. Results included about $40 million of pre-tax severance expenses and a $15 million pre-tax loss tied to alternative investment performance. Consolidated revenues declined 4.3% year over year to $1.90 billion. Fee income increased 7.5% to $620 million, but net investment income fell 8% to $537 million. Premiums remained nearly flat at $716 million. Total benefits and expenses rose 3.8% to $1.86 billion, including a 4.8% increase in operating expenses.
Manulife Financial Corporation (MFC - Free Report) reported second-quarter 2026 core earnings of 79 cents per share, which beat the Zacks Consensus Estimate by 1.3%. The bottom line increased 16% year over year. Revenues of $7.82 billion surpassed the consensus estimate of $7.42 billion by 5.4%.
Core earnings were C$1.92 billion ($1.38 billion), up 12% year over year. APE sales advanced 21% year over year to C$2.70 billion ($1.95 billion). Asia remained the largest contributor, with sales rising to C$2.07 billion from C$1.71 billion. Canada APE sales increased 23% year over year to C$426 million ($307.69 million).
Lincoln National Corporation (LNC - Free Report) reported second-quarter 2026 adjusted earnings per share of $2.24, which surpassed the Zacks Consensus Estimate by 12%. The bottom line declined 5.1% year over year. Adjusted operating revenues grew 4.2% year over year to $4.93 billion, surpassing the Zacks Consensus Estimate by 1.4%.
Management had earlier projected that the Annuities, Life Insurance, Group Protection and Retirement Plan Services units would account for 58-60%, 8-9%, 24-25% and 8-9%, respectively, of the company's total operating income in 2026. Management had earlier projected an RBC ratio of more than 420% in 2026 and over the long term.
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RGA Q2 Earnings Beat Estimates on Higher Premiums, Investment Income
Key Takeaways
Reinsurance Group of America, Incorporated (RGA - Free Report) reported second-quarter 2026 adjusted operating earnings of $8.89 per share, which beat the Zacks Consensus Estimate by 36.6%. The bottom line rose 88.3% from the year-ago quarter.
RGA reported strong second-quarter results, driven by solid growth in Financial Solutions businesses across the United States, EMEA and the Asia/Pacific, along with higher investment income and premium growth. However, higher expenses and lower premiums in the United States and Latin America Traditional segment and foreign currency headwinds partially offset the strong performance.
Reinsurance Group of America, Incorporated Price, Consensus and EPS Surprise
Reinsurance Group of America, Incorporated price-consensus-eps-surprise-chart | Reinsurance Group of America, Incorporated Quote
Behind the Headlines
RGA's operating revenues of $6.7 billion beat the Zacks Consensus Estimate by 1%. The top line improved 18.5% year over year on higher net investment income, net premiums and other revenues.
Net premiums of $4.5 billion increased 7.7% year over year and missed the Zacks Consensus Estimates by 4.2%.
Investment income improved 10.3% from the prior-year quarter to $1.8 billion and beat the Zacks Consensus Estimates by 13%. The increase was driven by a larger average invested asset base and higher earned yields. The average investment yield increased to 5.33% from 5.31% in the prior-year period, driven by higher variable investment income.
Total benefits and expenses increased 14.7% year over year to $6 billion, driven by higher claims and other policy benefits, interest credited, policy acquisition costs and other insurance expenses, and other operating expenses.
Quarterly Segmental Update
U.S. and Latin America: Total pre-tax adjusted operating income was $319 million, which increased 215.8% year over year.
The Traditional segment reported pre-tax adjusted operating income of $165 million, which rose from $4 million in the prior-year quarter. Net premiums declined 2.9% from the year-ago quarter to $2 billion.
The Financial Solutions segment’s pre-tax adjusted operating income increased 58.8% to $154 million.
Canada: Total pre-tax adjusted operating income rose 51.4% year over year to $56 million.
The Traditional segment delivered a 35.7% year-over-year increase in pre-tax adjusted operating income to $38 million. Net premiums grew 2.7% to $348 million. Foreign currency exchange rates had an immaterial effect on net premiums for the quarter.
The Financial Solutions segment’s pre-tax adjusted operating income doubled year over year to $18 million, benefiting from strong variable investment income.
EMEA: Total pre-tax adjusted operating income grew 28.4% to $172 million.
Pre-tax adjusted operating profit of the Traditional segment was $39 million, higher than the year-ago quarter’s profit of $18 million, driven by improved claims experience and favorable one-time items. Net premiums decreased 0.9% year over year to $568 million. Foreign currency exchange rates had a favorable effect on net premiums of $10 million for the quarter.
The Financial Solutions pre-tax adjusted operating income increased 14.7% year over year to $133 million, supported by new business and associated investment income.
Asia/Pacific: Total pre-tax adjusted operating income rose nearly 37.6% from the year-ago quarter’s level to $249 million.
The Traditional segment’s pre-tax adjusted operating income rose 24% year over year to $129 million, including a $2 million unfavorable impact from foreign currency exchange rates. Premiums increased 4.2% to $850 million, benefiting from new business growth. Foreign currency exchange rates had an unfavorable effect on net premiums of $4 million for the quarter.
The Financial Solutions segment’s pre-tax adjusted operating income increased 55.8% to $120 million. Foreign currency exchange rates had an immaterial impact of $7 million on adjusted operating income before taxes.
Corporate and Other: Pre-tax adjusted operating loss widened slightly to $35 million from a loss of $32 million in the year-ago quarter.
RGA’s Financial Update
As of June 30, 2026, total assets were $167 billion, up 6.7% from the 2025-end level.
Book value per share, excluding accumulated other comprehensive income, increased 11.5% to $173.77 from the 2025-end level.
Adjusted operating return on equity was 17.4%, representing a 470-basis-point year-over-year increase.
RGA’s Capital Deployment
Reinsurance Group returned $111 million to shareholders in the second quarter, including $50 million of share repurchases and $61 million in dividends.
The company’s board of directors declared a quarterly dividend of 98 cents, to be paid out on Sept 1, 2026, to shareholders of record as of Aug 18, 2026.
RGA’s Zacks Rank
RGA currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Some Other Insurers
Voya Financial, Inc. (VOYA - Free Report) reported second-quarter 2026 adjusted operating earnings of $1.51 per share, missing the Zacks Consensus Estimate of $1.88 by 19.7%. The bottom line declined 38.6% year over year. Revenues of $269 million missed the consensus mark by 4.6%.
After-tax adjusted operating earnings fell to $140 million from $240 million in the year-ago quarter. Results included about $40 million of pre-tax severance expenses and a $15 million pre-tax loss tied to alternative investment performance. Consolidated revenues declined 4.3% year over year to $1.90 billion. Fee income increased 7.5% to $620 million, but net investment income fell 8% to $537 million. Premiums remained nearly flat at $716 million. Total benefits and expenses rose 3.8% to $1.86 billion, including a 4.8% increase in operating expenses.
Manulife Financial Corporation (MFC - Free Report) reported second-quarter 2026 core earnings of 79 cents per share, which beat the Zacks Consensus Estimate by 1.3%. The bottom line increased 16% year over year. Revenues of $7.82 billion surpassed the consensus estimate of $7.42 billion by 5.4%.
Core earnings were C$1.92 billion ($1.38 billion), up 12% year over year. APE sales advanced 21% year over year to C$2.70 billion ($1.95 billion). Asia remained the largest contributor, with sales rising to C$2.07 billion from C$1.71 billion. Canada APE sales increased 23% year over year to C$426 million ($307.69 million).
Lincoln National Corporation (LNC - Free Report) reported second-quarter 2026 adjusted earnings per share of $2.24, which surpassed the Zacks Consensus Estimate by 12%. The bottom line declined 5.1% year over year. Adjusted operating revenues grew 4.2% year over year to $4.93 billion, surpassing the Zacks Consensus Estimate by 1.4%.
Management had earlier projected that the Annuities, Life Insurance, Group Protection and Retirement Plan Services units would account for 58-60%, 8-9%, 24-25% and 8-9%, respectively, of the company's total operating income in 2026. Management had earlier projected an RBC ratio of more than 420% in 2026 and over the long term.