Reinsurance Group of America Q1 2025: Unpacking Contradictions in Mortality Trends, Capital Deployment, and Growth Prospects

Biometric experience and mortality trends, pipeline and transaction opportunities, capital deployment and in-force management, capital deployment and use, and mortality assumptions and experience are the key contradictions discussed in Reinsurance Group of America's latest 2025Q1 earnings call.



Strong Financial Performance:
- RGA reported adjusted operating earnings of $5.66 per share for Q1 2025, with an adjusted operating return on equity of 15%.
- The strong results were driven by favorable claims experience, particularly in the U.S. and Asia, which continued a positive trend from the previous two years.

Favorable Claims Experience and Underwriting Results:
- Economic claims experience was favorable by $196 million, with a corresponding $58 million favorable current period financial impact.
- This was primarily due to lower-than-expected large claims, reflecting the company's strong underwriting results and biometric expertise.

Strategic Business Growth and New Business Activities:
- RGA deployed $418 million into in-force transactions, including strategic transactions like Manulife and Equitable.
- Growth in the Asia Traditional segment was driven by successful new treaties and Creation Re product development, which led to increased business value per transaction.

Positive Outlook on PRT Market and Capital Management:
- Despite market uncertainties, RGA remains very bullish on the PRT market, expecting it to recover in the second half of the year.
- The company has excess capital of approximately $1.9 billion and deployable capital estimated at $1.3 billion, indicating strong financial health and flexibility to deploy capital opportunistically.