F&G Annuities & Life (FG) 2024 KBW Insurance Conference summary

Strategic growth targets and performance

• Five-year plan aims for 50% asset growth and ROA expansion from 110 to 133–155 bps, with ROE up 300–400 bps.

• Tracking ahead of all key metrics less than a year into the plan.

• Current ROA is around 1.24%, with further upside from investment optimization, floaters, operational scale, and flow reinsurance.

• Flow reinsurance on 90% of MYGA business is highly accretive, contributing 14 bps to spread last quarter.

• Capital generation is self-supporting, with released capital reinvested for growth and a strong dividend maintained.

Market environment and product demand

• Annuity demand remains robust, with large cash reserves on the sidelines and demographic tailwinds from retiring baby boomers.

• Lower rates may increase demand as advisors encourage clients to lock in current rates.

• RILA launch targets a younger, risk-seeking demographic, with expectations for incremental business rather than cannibalization.

• MYGA sales are supported by 1035 exchanges and relative rate advantages, making the environment favorable even with an inverted yield curve.

Distribution and investment strategy

• Own distribution strategy involves $680M invested in IMOs, focusing on long-term relationships and diversification rather than forced sales.

• Portfolio of IMOs is diverse, with some operational synergies and potential for future spin-out.

• Opportunities exist for further roll-ups and leveraging best practices across platforms.

• Capital deployment prioritizes business growth and own distribution over buybacks, which are reserved for market dislocations.