Corebridge Financial Reports Strong Q2 Amid Record Annuity Sales and Strategic Reinsurance Deal
Corebridge Financial reported solid second-quarter results, reflecting a strong environment for annuity sales. The Houston-based company saw sales rise 5.8% year-over-year to $4.42 billion, surpassing analysts' earnings expectations with a profit of $1.36 per share, 17.5% above consensus estimates. This growth took place in a broader market context where total annuity sales increased 5% year-over-year to $116.6 billion, according to LIMRA data.
A key growth driver for Corebridge was the introduction of the MarketLock Registered Indexed-Linked Annuity (RILA), which uses a "lock strategy" crediting rates based on actual S&P 500 index performance once a preset growth target is achieved. This product allows customers to lock gains and enjoy fixed interest rates until the next contract anniversary, providing a flexible and secure retirement income option. Remarkably, cumulative RILA sales exceeded $1 billion within nine months of launch.
Corebridge's Individual Retirement segment outperformed the prior year's record quarter, indicating sustained demand amid favorable economic and demographic factors. CEO Kevin Hogan highlighted underlying drivers such as the aging U.S. population, increasing consumer responsibility for retirement planning, and broad advisor support. The yield curve's current shape also benefits annuity sales, which Hogan described as robust across all products.
Additionally, Corebridge announced a strategic reinsurance agreement with CS Life Re, owned by Venerable Holdings, which will reinsure $51 billion in variable annuity account values. Valued at $2.8 billion, this deal includes ceding commissions and capital release, expected to generate $2.1 billion in net distributable proceeds after tax. Hogan emphasized this as the most significant value-creation action since Corebridge's 2022 spin-off from AIG and IPO. The transaction aims to improve earnings quality and reduce net income volatility by transferring risk associated with variable annuities.
Corebridge acknowledged elevated surrender rates, common in an environment of shifting yields and credit spreads. Executives anticipate higher fixed and indexed annuity surrenders during 2025 but view these as typical within annuity portfolio management. Hogan noted that increased surrenders often coincide with higher overall business volumes.
Financial metrics showed premiums and deposits rising slightly to $868 million in Q2, with adjusted pre-tax operating income increasing to $133 million versus $95 million a year earlier. For the first six months, premiums and deposits totaled $6.85 billion with adjusted pre-tax income of $623 million.
The company’s broad annuity product portfolio and extensive distribution network position it well to capitalize on the growing retirement market, with over four million Americans reaching age 65 annually. Corebridge is thus geared to meet both accumulation and decumulation needs through competitive market offerings and strategic partnerships.