Research · Sep 3, 2026
[RGA] Reinsurance Group of America Thesis 2026: Record Earnings and ROE Validate Life Reinsurance Cycle
Reinsurance Group of America (RGA) FY25 (Dec) revenue $22.79B (+3.4%); op income $1.54B (+57%); NI $1.18B (+65%); EPS $17.69 (+65% from $10.73). Adj op ROE 15.7% — above 13-15% intermediate target. Q4 operating EPS $7.75 (second consecutive record quarter). $2.5B capital deployed FY25 into in-force transactions; $2.7B excess capital year-end. Value of in-force business margins +18% FY25. In-force management actions $95M favorable Q4 impact. Equitable transaction closed Q3 2025: ~$70M pretax H2 2025; guided $160-170M pretax 2026; ~$200M by 2027. Creation Re: >50% of new business from proprietary product development over 2 years. EMEA Financial Solutions: favorable longevity + strong growth; UK PRT market leader. APAC Traditional: favorable multi-quarter; Hong Kong + simplified issue CI (Creation Re). US group healthcare excess claims repricing by 2026. Buybacks reinstated $174M FY25 (+544%). Total debt $5.71B (+13%). FY26 framework: 8-10% annual EPS growth; ROE 13-15%; Equitable $160-170M; variable investment income 7%; capital deployed ~$1.5B; $400M to reduce leverage; shareholder return 20-30% of after-tax earnings. Risks: mortality volatility, variable investment income dependence, in-force action timing, Equitable execution, FX, group repricing lag, competition, interest rate sensitivity, regulatory changes.