Fortitude Life Insurance & Annuity Variable Account F Co.

04/27/2026 | Press release | Distributed by Public on 04/27/2026 13:26

Financial Statements by Insurance Company (Form N-VPFS)


FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F
STATEMENTS OF NET ASSETS
December 31, 2025
SUBACCOUNTS
AST Large-Cap Growth Portfolio AST Government Money Market Portfolio AST Cohen & Steers Realty Portfolio** AST J.P. Morgan Conservative Multi-Asset Portfolio AST High Yield Portfolio**
ASSETS
Investment in the portfolios, at fair value $ 25,917,281 $ 3,744,976 $ - $ 950,203 $ -
Net Assets $ 25,917,281 $ 3,744,976 $ - $ 950,203 $ -
NET ASSETS, representing:
Accumulation units $ 25,917,281 $ 3,744,976 $ - $ 950,203 $ -
$ 25,917,281 $ 3,744,976 $ - $ 950,203 $ -
Units outstanding 421,364 323,473 - 51,092 -
Portfolio shares held 234,652 3,744,976 - 34,883 -
Portfolio net asset value per share $ 110.45 $ 1.00 $ - $ 27.24 $ -
Investment in portfolio shares, at cost $ 14,791,670 $ 3,744,976 $ - $ 729,807 $ -


STATEMENTS OF OPERATIONS
For the period ended December 31, 2025
SUBACCOUNTS
AST Large-Cap Growth Portfolio AST Government Money Market Portfolio AST Cohen & Steers Realty Portfolio AST J.P. Morgan Conservative Multi-Asset Portfolio AST High Yield Portfolio
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 1/24/2025** 12/31/2025 2/7/2025**
INVESTMENT INCOME
Dividend income $ - $ 127,688 $ - $ - $ -
EXPENSES
Charges for mortality and expense risk, and for
administration 208,371 25,113 738 8,171 1,012
NET INVESTMENT INCOME (LOSS) (208,371) 102,575 (738) (8,171) (1,012)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received - - - - -
Net realized gain (loss) on shares redeemed 1,176,409 - 729,531 55,110 333,963
Net change in unrealized appreciation (depreciation) on investments 2,715,458 - (705,282) 42,525 (317,494)
NET GAIN (LOSS) ON INVESTMENTS 3,891,867 - 24,249 97,635 16,469
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 3,683,496 $ 102,575 $ 23,511 $ 89,464 $ 15,457
**Subaccount was no longer available for investment as of the date presented in the Statement of Operations.

The accompanying notes are an integral part of these financial statements.
A1

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF NET ASSETS
December 31, 2025
SUBACCOUNTS
AST Large-Cap Value Portfolio AST Small-Cap Equity Portfolio AST T. Rowe Price Natural Resources Portfolio** AST MFS Global Equity Portfolio** AST International Equity Portfolio
ASSETS
Investment in the portfolios, at fair value $ 14,718,886 $ 7,463,279 $ - $ - $ 4,570,922
Net Assets $ 14,718,886 $ 7,463,279 $ - $ - $ 4,570,922
NET ASSETS, representing:
Accumulation units $ 14,718,886 $ 7,463,279 $ - $ - $ 4,570,922
$ 14,718,886 $ 7,463,279 $ - $ - $ 4,570,922
Units outstanding 479,909 237,113 - - 161,678
Portfolio shares held 241,175 86,682 - - 128,109
Portfolio net asset value per share $ 61.03 $ 86.10 $ - $ - $ 35.68
Investment in portfolio shares, at cost $ 11,897,785 $ 6,866,451 $ - $ - $ 2,945,256


STATEMENTS OF OPERATIONS
For the period ended December 31, 2025
SUBACCOUNTS
AST Large-Cap Value Portfolio AST Small-Cap Equity Portfolio AST T. Rowe Price Natural Resources Portfolio AST MFS Global Equity Portfolio AST International Equity Portfolio
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 1/24/2025** 1/24/2025** 12/31/2025
INVESTMENT INCOME
Dividend income $ - $ - $ - $ - $ -
EXPENSES
Charges for mortality and expense risk, and for
administration 109,655 56,191 464 584 35,174
NET INVESTMENT INCOME (LOSS) (109,655) (56,191) (464) (584) (35,174)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received - - - - -
Net realized gain (loss) on shares redeemed 229,952 245,561 302,339 527,667 288,970
Net change in unrealized appreciation (depreciation) on investments 1,867,570 286,257 (234,044) (489,977) 890,588
NET GAIN (LOSS) ON INVESTMENTS 2,097,522 531,818 68,295 37,690 1,179,558
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 1,987,867 $ 475,627 $ 67,831 $ 37,106 $ 1,144,384
**Subaccount was no longer available for investment as of the date presented in the Statement of Operations.
The accompanying notes are an integral part of these financial statements.
A2

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF NET ASSETS
December 31, 2025
SUBACCOUNTS
ProFund VP Bear ProFund VP UltraBull ProFund VP Europe 30 ProFund VP Nasdaq-100 ProFund VP UltraNasdaq-100
ASSETS
Investment in the portfolios, at fair value $ 6,381 $ 249,647 $ 17,977 $ 1,433,868 $ 2,784,103
Net Assets $ 6,381 $ 249,647 $ 17,977 $ 1,433,868 $ 2,784,103
NET ASSETS, representing:
Accumulation units $ 6,381 $ 249,647 $ 17,977 $ 1,433,868 $ 2,784,103
$ 6,381 $ 249,647 $ 17,977 $ 1,433,868 $ 2,784,103
Units outstanding 2,932 3,221 1,023 29,589 28,270
Portfolio shares held 700 5,487 574 20,628 54,601
Portfolio net asset value per share $ 9.12 $ 45.50 $ 31.33 $ 69.51 $ 50.99
Investment in portfolio shares, at cost $ 9,107 $ 175,946 $ 13,467 $ 1,197,222 $ 1,757,524


STATEMENTS OF OPERATIONS
For the period ended December 31, 2025
SUBACCOUNTS
ProFund VP Bear ProFund VP UltraBull ProFund VP Europe 30 ProFund VP Nasdaq-100 ProFund VP UltraNasdaq-100
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 12/31/2025 12/31/2025 12/31/2025
INVESTMENT INCOME
Dividend income $ 198 $ 1,627 $ 683 $ 5,506 $ 5,566
EXPENSES
Charges for mortality and expense risk, and for
administration 34 2,271 226 7,061 17,495
NET INVESTMENT INCOME (LOSS) 164 (644) 457 (1,555) (11,929)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received - 29,394 960 96,236 244,493
Net realized gain (loss) on shares redeemed (1,035) 2,413 3,756 3,241 (56,280)
Net change in unrealized appreciation (depreciation) on investments (222) 8,620 2,053 127,752 434,341
NET GAIN (LOSS) ON INVESTMENTS (1,257) 40,427 6,769 227,229 622,554
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ (1,093) $ 39,783 $ 7,226 $ 225,674 $ 610,625



The accompanying notes are an integral part of these financial statements.
A3

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF NET ASSETS
December 31, 2025
SUBACCOUNTS
ProFund VP UltraSmall-Cap Rydex VT Nova Fund Rydex VT NASDAQ-100® Fund Rydex VT Inverse S&P 500® Strategy Fund Invesco V.I. Health Care Fund (Series I)
ASSETS
Investment in the portfolios, at fair value $ 186,405 $ 170,612 $ 207,291 $ 858 $ 1,007,333
Net Assets $ 186,405 $ 170,612 $ 207,291 $ 858 $ 1,007,333
NET ASSETS, representing:
Accumulation units $ 186,405 $ 170,612 $ 207,291 $ 858 $ 1,007,333
$ 186,405 $ 170,612 $ 207,291 $ 858 $ 1,007,333
Units outstanding 7,043 3,221 4,485 1,270 36,801
Portfolio shares held 11,004 663 2,143 9 33,701
Portfolio net asset value per share $ 16.94 $ 257.32 $ 96.73 $ 91.61 $ 29.89
Investment in portfolio shares, at cost $ 156,862 $ 93,478 $ 138,978 $ 1,033 $ 931,858


STATEMENTS OF OPERATIONS
For the period ended December 31, 2025
SUBACCOUNTS
ProFund VP UltraSmall-Cap Rydex VT Nova Fund Rydex VT NASDAQ-100® Fund Rydex VT Inverse S&P 500® Strategy Fund Invesco V.I. Health Care Fund (Series I)
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 12/31/2025 12/31/2025 12/31/2025
INVESTMENT INCOME
Dividend income $ 1,831 $ - $ 59 $ 91 $ -
EXPENSES
Charges for mortality and expense risk, and for
administration 1,609 1,690 1,567 117 8,508
NET INVESTMENT INCOME (LOSS) 222 (1,690) (1,508) (26) (8,508)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received - - 10,774 - 38,944
Net realized gain (loss) on shares redeemed (2,198) 1,812 2,561 (919) 3,062
Net change in unrealized appreciation (depreciation) on investments 23,308 27,769 20,220 (199) 98,228
NET GAIN (LOSS) ON INVESTMENTS 21,110 29,581 33,555 (1,118) 140,234
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 21,332 $ 27,891 $ 32,047 $ (1,144) $ 131,726


The accompanying notes are an integral part of these financial statements.
A4

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF NET ASSETS
December 31, 2025
SUBACCOUNTS
Invesco V.I. Technology Fund (Series I) Allspring VT Discovery All Cap Growth Fund (Class 1) Allspring VT Small Cap Growth Fund (Class 1) Invesco V.I. Diversified Dividend Fund (Series I) NVIT Fidelity Institutional AM® Emerging Markets Fund (Class D)
ASSETS
Investment in the portfolios, at fair value $ 2,150,844 $ 42,337 $ 333,082 $ 760,675 $ 563,572
Net Assets $ 2,150,844 $ 42,337 $ 333,082 $ 760,675 $ 563,572
NET ASSETS, representing:
Accumulation units $ 2,150,844 $ 42,337 $ 333,082 $ 760,675 $ 563,572
$ 2,150,844 $ 42,337 $ 333,082 $ 760,675 $ 563,572
Units outstanding 57,133 917 10,299 24,823 37,759
Portfolio shares held 83,723 1,842 32,182 27,945 38,548
Portfolio net asset value per share $ 25.69 $ 22.98 $ 10.35 $ 27.22 $ 14.62
Investment in portfolio shares, at cost $ 1,739,628 $ 41,502 $ 336,124 $ 707,987 $ 470,233


STATEMENTS OF OPERATIONS
For the period ended December 31, 2025
SUBACCOUNTS
Invesco V.I. Technology Fund (Series I) Allspring VT Discovery All Cap Growth Fund (Class 1) Allspring VT Small Cap Growth Fund (Class 1) Invesco V.I. Diversified Dividend Fund (Series I) NVIT Fidelity Institutional AM® Emerging Markets Fund (Class D)
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 12/31/2025 12/31/2025 12/31/2025
INVESTMENT INCOME
Dividend income $ - $ - $ - $ 11,717 $ 1,662
EXPENSES
Charges for mortality and expense risk, and for
administration 17,177 173 3,033 7,312 4,719
NET INVESTMENT INCOME (LOSS) (17,177) (173) (3,033) 4,405 (3,057)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received 226,676 1,262 17,617 56,022 -
Net realized gain (loss) on shares redeemed 4,249 (201) (4,255) 3,978 21,535
Net change in unrealized appreciation (depreciation) on investments 135,934 577 16,753 35,397 139,641
NET GAIN (LOSS) ON INVESTMENTS 366,859 1,638 30,115 95,397 161,176
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 349,682 $ 1,465 $ 27,082 $ 99,802 $ 158,119
The accompanying notes are an integral part of these financial statements.
A5

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF NET ASSETS
December 31, 2025
SUBACCOUNTS
AST PGIM Aggressive Multi-Asset Portfolio AST Core Fixed Income Portfolio Invesco V.I. Discovery Mid Cap Growth Fund (Series I) AST Global Bond Portfolio** AST Large-Cap Equity Portfolio
ASSETS
Investment in the portfolios, at fair value $ 272,093 $ 6,759,809 $ 1,022,395 $ - $ 6,887,235
Net Assets $ 272,093 $ 6,759,809 $ 1,022,395 $ - $ 6,887,235
NET ASSETS, representing:
Accumulation units $ 272,093 $ 6,759,809 $ 1,022,395 $ - $ 6,887,235
$ 272,093 $ 6,759,809 $ 1,022,395 $ - $ 6,887,235
Units outstanding 15,543 618,233 60,443 - 461,502
Portfolio shares held 9,477 470,084 13,594 - 153,836
Portfolio net asset value per share $ 28.71 $ 14.38 $ 75.21 $ - $ 44.77
Investment in portfolio shares, at cost $ 188,830 $ 6,522,523 $ 1,060,458 $ - $ 5,527,261


STATEMENTS OF OPERATIONS
For the period ended December 31, 2025
SUBACCOUNTS
AST PGIM Aggressive Multi-Asset Portfolio AST Core Fixed Income Portfolio Invesco V.I. Discovery Mid Cap Growth Fund (Series I) AST Global Bond Portfolio AST Large-Cap Equity Portfolio
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 12/31/2025 2/7/2025** 12/31/2025
INVESTMENT INCOME
Dividend income $ - $ - $ - $ - $ -
EXPENSES
Charges for mortality and expense risk, and for
administration 2,477 50,989 7,485 386 58,035
NET INVESTMENT INCOME (LOSS) (2,477) (50,989) (7,485) (386) (58,035)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received - - 85,551 - -
Net realized gain (loss) on shares redeemed 37,025 (17,667) 3,567 (20,896) 298,546
Net change in unrealized appreciation (depreciation) on investments 522 466,044 (39,749) 23,290 498,099
NET GAIN (LOSS) ON INVESTMENTS 37,547 448,377 49,369 2,394 796,645
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 35,070 $ 397,388 $ 41,884 $ 2,008 $ 738,610
**Subaccount was no longer available for investment as of the date presented in the Statement of Operations.
The accompanying notes are an integral part of these financial statements.
A6

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F
STATEMENTS OF NET ASSETS
December 31, 2025
SUBACCOUNTS
AST Aggressive Asset Allocation Portfolio AST Balanced Asset Allocation Portfolio
ASSETS
Investment in the portfolios, at fair value $ 2,207,942 $ 1,524,416
Net Assets $ 2,207,942 $ 1,524,416
NET ASSETS, representing:
Accumulation units $ 2,207,942 $ 1,524,416
$ 2,207,942 $ 1,524,416
Units outstanding 150,248 138,792
Portfolio shares held 58,644 47,579
Portfolio net asset value per share $ 37.65 $ 32.04
Investment in portfolio shares, at cost $ 1,474,725 $ 1,377,487


STATEMENTS OF OPERATIONS
For the period ended December 31, 2025
SUBACCOUNTS
AST Aggressive Asset Allocation Portfolio AST Balanced Asset Allocation Portfolio
1/1/2025 1/1/2025
to to
12/31/2025 12/31/2025
INVESTMENT INCOME
Dividend income $ - $ -
EXPENSES
Charges for mortality and expense risk, and for
administration 19,294 13,203
NET INVESTMENT INCOME (LOSS) (19,294) (13,203)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received - -
Net realized gain (loss) on shares redeemed 23,774 5,092
Net change in unrealized appreciation (depreciation) on investments 285,547 200,274
NET GAIN (LOSS) ON INVESTMENTS 309,321 205,366
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 290,027 $ 192,163





The accompanying notes are an integral part of these financial statements.
A7

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2025
SUBACCOUNTS
AST Large-Cap Growth Portfolio AST Government Money Market Portfolio AST Cohen & Steers Realty Portfolio AST J.P. Morgan Conservative Multi-Asset Portfolio AST High Yield Portfolio
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 1/24/2025** 12/31/2025 2/7/2025**
OPERATIONS
Net investment income (loss) $ (208,371) $ 102,575 $ (738) $ (8,171) $ (1,012)
Capital gains distributions received - - - - -
Net realized gain (loss) on shares redeemed 1,176,409 - 729,531 55,110 333,963
Net change in unrealized appreciation (depreciation) on investments 2,715,458 - (705,282) 42,525 (317,494)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 3,683,496 102,575 23,511 89,464 15,457
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 280,119 143,933 322 16,045 1,323
Policy loans (173,003) (1,088) - (14) (15)
Policy loan repayments and interest 36,730 38 42 - -
Surrenders, withdrawals and death benefits (814,689) (2,448,036) - (4,841) (2)
Net transfers between other subaccounts
or fixed rate option (905,418) 2,853,260 (1,492,597) (66,253) (1,128,860)
Miscellaneous transactions 14,947 (893) 4,846 2 1,574
Other charges (495,113) (216,771) (1,561) (37,131) (3,920)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM CONTRACT OWNER TRANSACTIONS (2,056,427) 330,443 (1,488,948) (92,192) (1,129,900)
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,627,069 433,018 (1,465,437) (2,728) (1,114,443)
NET ASSETS
Beginning of period 24,290,212 3,311,958 1,465,437 952,931 1,114,443
End of period $ 25,917,281 $ 3,744,976 $ - $ 950,203 $ -
Beginning units 457,287 293,246 57,524 55,128 60,565
Units issued 5,324 314,781 143 1,670 100
Units redeemed (41,247) (284,554) (57,667) (5,706) (60,665)
Ending units 421,364 323,473 - 51,092 -
**Date subaccount was no longer available for investment.
The accompanying notes are an integral part of these financial statements.
A8

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2025
SUBACCOUNTS
AST Large-Cap Value Portfolio AST Small-Cap Equity Portfolio AST T. Rowe Price Natural Resources Portfolio AST MFS Global Equity Portfolio AST International Equity Portfolio
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 1/24/2025** 1/24/2025** 12/31/2025
OPERATIONS
Net investment income (loss) $ (109,655) $ (56,191) $ (464) $ (584) $ (35,174)
Capital gains distributions received - - - - -
Net realized gain (loss) on shares redeemed 229,952 245,561 302,339 527,667 288,970
Net change in unrealized appreciation (depreciation) on investments 1,867,570 286,257 (234,044) (489,977) 890,588
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 1,987,867 475,627 67,831 37,106 1,144,384
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 156,701 78,145 997 246 80,954
Policy loans (73,893) (19,084) - - (9,461)
Policy loan repayments and interest 6,339 4,011 - 15 1,895
Surrenders, withdrawals and death benefits (338,603) (218,628) - - (184,469)
Net transfers between other subaccounts
or fixed rate option (257,029) (95,779) (837,488) (1,262,623) (183,874)
Miscellaneous transactions 2,548 3,683 17 (21) 1,271
Other charges (307,055) (131,565) (2,145) (1,182) (107,392)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM CONTRACT OWNER TRANSACTIONS (810,992) (379,217) (838,619) (1,263,565) (401,076)
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,176,875 96,410 (770,788) (1,226,459) 743,308
NET ASSETS
Beginning of period 13,542,011 7,366,869 770,788 1,226,459 3,827,614
End of period $ 14,718,886 $ 7,463,279 $ - $ - $ 4,570,922
Beginning units 507,557 249,647 34,948 53,955 180,508
Units issued 11,360 9,855 17 5 4,269
Units redeemed (39,008) (22,389) (34,965) (53,960) (23,099)
Ending units 479,909 237,113 - - 161,678
**Date subaccount was no longer available for investment.


The accompanying notes are an integral part of these financial statements.
A9

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2025
SUBACCOUNTS
ProFund VP Bear ProFund VP UltraBull ProFund VP Europe 30 ProFund VP Nasdaq-100 ProFund VP UltraNasdaq-100
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 12/31/2025 12/31/2025 12/31/2025
OPERATIONS
Net investment income (loss) $ 164 $ (644) $ 457 $ (1,555) $ (11,929)
Capital gains distributions received - 29,394 960 96,236 244,493
Net realized gain (loss) on shares redeemed (1,035) 2,413 3,756 3,241 (56,280)
Net change in unrealized appreciation (depreciation) on investments (222) 8,620 2,053 127,752 434,341
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS (1,093) 39,783 7,226 225,674 610,625
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 1,787 1,426 288 6,351 7,594
Policy loans (2) (5) - (216) (172)
Policy loan repayments and interest - 110 - 10,500 3,656
Surrenders, withdrawals and death benefits (77) - (1,047) - (26,772)
Net transfers between other subaccounts
or fixed rate option 169 44,558 (15,022) (69,451) 17,691
Miscellaneous transactions 4 177 - 134 (46)
Other charges (1,473) (2,068) (969) (49,297) (58,379)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM CONTRACT OWNER TRANSACTIONS 408 44,198 (16,750) (101,979) (56,428)
TOTAL INCREASE (DECREASE) IN NET ASSETS (685) 83,981 (9,524) 123,695 554,197
NET ASSETS
Beginning of period 7,066 165,666 27,501 1,310,173 2,229,906
End of period $ 6,381 $ 249,647 $ 17,977 $ 1,433,868 $ 2,784,103
Beginning units 2,763 2,643 2,053 31,939 29,025
Units issued 784 1,168 41 2,471 1,444
Units redeemed (615) (590) (1,071) (4,821) (2,199)
Ending units 2,932 3,221 1,023 29,589 28,270



The accompanying notes are an integral part of these financial statements.
A10

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2025
SUBACCOUNTS
ProFund VP UltraSmall-Cap Rydex VT Nova Fund Rydex VT NASDAQ-100® Fund Rydex VT Inverse S&P 500® Strategy Fund Invesco V.I. Health Care Fund (Series I)
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 12/31/2025 12/31/2025 12/31/2025
OPERATIONS
Net investment income (loss) $ 222 $ (1,690) $ (1,508) $ (26) $ (8,508)
Capital gains distributions received - - 10,774 - 38,944
Net realized gain (loss) on shares redeemed (2,198) 1,812 2,561 (919) 3,062
Net change in unrealized appreciation (depreciation) on investments 23,308 27,769 20,220 (199) 98,228
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 21,332 27,891 32,047 (1,144) 131,726
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 2,159 299 323 371 11,173
Policy loans (10) (7) - - (5,780)
Policy loan repayments and interest 34 - - - 220
Surrenders, withdrawals and death benefits (4,231) - - - (31,637)
Net transfers between other subaccounts
or fixed rate option (9,072) 18,356 (1,583) 765 (61,842)
Miscellaneous transactions (1) 2 7 - 135
Other charges (4,016) (1,633) (7,286) (59) (18,640)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM CONTRACT OWNER TRANSACTIONS (15,137) 17,017 (8,539) 1,077 (106,371)
TOTAL INCREASE (DECREASE) IN NET ASSETS 6,195 44,908 23,508 (67) 25,355
NET ASSETS
Beginning of period 180,210 125,704 183,783 925 981,978
End of period $ 186,405 $ 170,612 $ 207,291 $ 858 $ 1,007,333
Beginning units 7,542 2,842 4,685 1,193 41,780
Units issued 782 413 3 74,140 1,140
Units redeemed (1,281) (34) (203) (74,063) (6,119)
Ending units 7,043 3,221 4,485 1,270 36,801


The accompanying notes are an integral part of these financial statements.
A11

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2025
SUBACCOUNTS
Invesco V.I. Technology Fund (Series I) Allspring VT Discovery All Cap Growth Fund (Class 1) Allspring VT Small Cap Growth Fund (Class 1) Invesco V.I. Diversified Dividend Fund (Series I) NVIT Fidelity Institutional AM® Emerging Markets Fund (Class D)
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 12/31/2025 12/31/2025 12/31/2025
OPERATIONS
Net investment income (loss) $ (17,177) $ (173) $ (3,033) $ 4,405 $ (3,057)
Capital gains distributions received 226,676 1,262 17,617 56,022 -
Net realized gain (loss) on shares redeemed 4,249 (201) (4,255) 3,978 21,535
Net change in unrealized appreciation (depreciation) on investments 135,934 577 16,753 35,397 139,641
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 349,682 1,465 27,082 99,802 158,119
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 29,837 606 2,913 26,736 18,380
Policy loans (148) - (7,060) (3,125) (42)
Policy loan repayments and interest 463 - - - -
Surrenders, withdrawals and death benefits (34,446) - (3,273) (6,616) (40,165)
Net transfers between other subaccounts
or fixed rate option 14,384 38,462 (1,042) (18,074) (41,602)
Miscellaneous transactions (825) (19) 13 (18) 16
Other charges (50,104) (2,500) (9,434) (28,180) (27,055)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM CONTRACT OWNER TRANSACTIONS (40,839) 36,549 (17,883) (29,277) (90,468)
TOTAL INCREASE (DECREASE) IN NET ASSETS 308,843 38,014 9,199 70,525 67,651
NET ASSETS
Beginning of period 1,842,001 4,323 323,883 690,150 495,921
End of period $ 2,150,844 $ 42,337 $ 333,082 $ 760,675 $ 563,572
Beginning units 58,445 109 10,951 26,295 44,499
Units issued 1,838 847 359 1,196 2,460
Units redeemed (3,150) (39) (1,011) (2,668) (9,200)
Ending units 57,133 917 10,299 24,823 37,759

The accompanying notes are an integral part of these financial statements.
A12

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2025
SUBACCOUNTS
AST PGIM Aggressive Multi-Asset Portfolio AST Core Fixed Income Portfolio Invesco V.I. Discovery Mid Cap Growth Fund (Series I) AST Global Bond Portfolio AST Large-Cap Equity Portfolio
1/1/2025 1/1/2025 1/1/2025 1/1/2025 1/1/2025
to to to to to
12/31/2025 12/31/2025 12/31/2025 2/7/2025** 12/31/2025
OPERATIONS
Net investment income (loss) $ (2,477) $ (50,989) $ (7,485) $ (386) $ (58,035)
Capital gains distributions received - - 85,551 - -
Net realized gain (loss) on shares redeemed 37,025 (17,667) 3,567 (20,896) 298,546
Net change in unrealized appreciation (depreciation) on investments 522 466,044 (39,749) 23,290 498,099
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 35,070 397,388 41,884 2,008 738,610
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 12,958 123,701 10,216 910 72,831
Policy loans - (23,523) (24) - (443)
Policy loan repayments and interest - 6,128 - - 6,320
Surrenders, withdrawals and death benefits (36,888) (69,488) (9,315) - (165,592)
Net transfers between other subaccounts
or fixed rate option (2,005) 1,294,379 38,734 (520,912) 2,938,761
Miscellaneous transactions 1,892 (95) 26 (10) 7,550
Other charges (12,672) (202,583) (34,674) (1,299) (153,231)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM CONTRACT OWNER TRANSACTIONS (36,715) 1,128,519 4,963 (521,311) 2,706,196
TOTAL INCREASE (DECREASE) IN NET ASSETS (1,645) 1,525,907 46,847 (519,303) 3,444,806
NET ASSETS
Beginning of period 273,738 5,233,902 975,548 519,303 3,442,429
End of period $ 272,093 $ 6,759,809 $ 1,022,395 $ - $ 6,887,235
Beginning units 18,013 507,939 59,944 56,235 263,500
Units issued 3,093 184,489 3,657 117 272,711
Units redeemed (5,563) (74,195) (3,158) (56,352) (74,709)
Ending units 15,543 618,233 60,443 - 461,502
**Date subaccount was no longer available for investment.
The accompanying notes are an integral part of these financial statements.
A13

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2025
SUBACCOUNTS
AST Aggressive Asset Allocation Portfolio AST Balanced Asset Allocation Portfolio
1/1/2025 1/1/2025
to to
12/31/2025 12/31/2025
OPERATIONS
Net investment income (loss) $ (19,294) $ (13,203)
Capital gains distributions received - -
Net realized gain (loss) on shares redeemed 23,774 5,092
Net change in unrealized appreciation (depreciation) on investments 285,547 200,274
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 290,027 192,163
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 27,624 22,841
Policy loans (32) (86)
Policy loan repayments and interest 3,958 971
Surrenders, withdrawals and death benefits (10) (11,311)
Net transfers between other subaccounts
or fixed rate option (26,585) (239,030)
Miscellaneous transactions 37 13
Other charges (37,036) (43,200)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM CONTRACT OWNER TRANSACTIONS (32,044) (269,802)
TOTAL INCREASE (DECREASE) IN NET ASSETS 257,983 (77,639)
NET ASSETS
Beginning of period 1,949,959 1,602,055
End of period $ 2,207,942 $ 1,524,416
Beginning units 152,693 165,395
Units issued 2,998 2,766
Units redeemed (5,443) (29,369)
Ending units 150,248 138,792






The accompanying notes are an integral part of these financial statements.
A14

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2024
SUBACCOUNTS
AST Large-Cap Growth Portfolio AST Government Money Market Portfolio AST Cohen & Steers Realty Portfolio AST J.P. Morgan Conservative Multi-Asset Portfolio AST High Yield Portfolio
1/1/2024 1/1/2024 1/1/2024 1/1/2024 1/1/2024
to to to to to
12/31/2024 12/31/2024 12/31/2024 12/31/2024 12/31/2024
OPERATIONS
Net investment income (loss) $ (163,990) $ 122,314 $ (11,523) $ (8,051) $ (9,839)
Capital gains distributions received - - - - -
Net realized gain (loss) on shares redeemed 709,815 - 44,930 16,723 32,657
Net change in unrealized appreciation (depreciation) on investments 3,967,395 - 51,398 40,485 49,274
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 4,513,220 122,314 84,805 49,157 72,092
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 212,396 149,154 12,443 17,360 15,622
Policy loans (15,452) (1,070) (88) (13) (237)
Policy loan repayments and interest 32,781 557 686 - 280
Surrenders, withdrawals and death benefits (875,087) (2,914,722) (5,062) (25) (5,793)
Net transfers between other subaccounts
or fixed rate option 3,861,096 2,842,038 (28,697) (359) (45,628)
Miscellaneous transactions (1,024) (5,121) 54 (11) (15)
Other charges (395,949) (208,543) (26,904) (39,886) (35,176)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS 2,818,761 (137,707) (47,568) (22,934) (70,947)
TOTAL INCREASE (DECREASE) IN NET ASSETS 7,331,981 (15,393) 37,237 26,223 1,145
NET ASSETS
Beginning of period 16,958,231 3,327,351 1,428,200 926,708 1,113,298
End of period $ 24,290,212 $ 3,311,958 $ 1,465,437 $ 952,931 $ 1,114,443
Beginning units 403,763 305,493 58,986 56,357 63,922
Units issued 91,928 316,284 581 1,036 1,521
Units redeemed (38,404) (328,531) (2,043) (2,265) (4,878)
Ending units 457,287 293,246 57,524 55,128 60,565


The accompanying notes are an integral part of these financial statements.
A15

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2024
SUBACCOUNTS
AST Large-Cap Value Portfolio AST Small-Cap Equity Portfolio AST T. Rowe Price Natural Resources Portfolio AST MFS Global Equity Portfolio AST International Equity Portfolio
1/1/2024 1/1/2024 1/1/2024 1/1/2024 1/1/2024
to to to to to
12/31/2024 12/31/2024 12/31/2024 12/31/2024 12/31/2024
OPERATIONS
Net investment income (loss) $ (67,003) $ (22,291) $ (7,184) $ (8,798) $ (34,098)
Capital gains distributions received - - - - -
Net realized gain (loss) on shares redeemed 176,048 210,158 22,124 13,612 306,954
Net change in unrealized appreciation (depreciation) on investments 467,621 (135,923) 9,341 48,975 (81,866)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 576,666 51,944 24,281 53,789 190,990
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 107,291 42,756 14,844 10,034 59,287
Policy loans (7,500) (174) (23) (38) (443)
Policy loan repayments and interest 8,262 1,034 4,516 533 5,406
Surrenders, withdrawals and death benefits (809,721) (59,223) (684) (3,418) (316,325)
Net transfers between other subaccounts
or fixed rate option 5,256,172 5,045,935 (13,682) 33,256 (129,859)
Miscellaneous transactions 162 (180) (156) (8) 1,492
Other charges (200,982) (53,267) (32,619) (18,498) (96,909)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS 4,353,684 4,976,881 (27,804) 21,861 (477,351)
TOTAL INCREASE (DECREASE) IN NET ASSETS 4,930,350 5,028,825 (3,523) 75,650 (286,361)
NET ASSETS
Beginning of period 8,611,661 2,338,044 774,311 1,150,809 4,113,975
End of period $ 13,542,011 $ 7,366,869 $ 770,788 $ 1,226,459 $ 3,827,614
Beginning units 352,773 86,061 36,867 52,547 198,608
Units issued 197,473 173,215 1,362 2,135 4,034
Units redeemed (42,689) (9,629) (3,281) (727) (22,134)
Ending units 507,557 249,647 34,948 53,955 180,508
The accompanying notes are an integral part of these financial statements.
A16

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2024
SUBACCOUNTS
ProFund VP Bear ProFund VP UltraBull ProFund VP Europe 30 ProFund VP Nasdaq-100 ProFund VP UltraNasdaq-100
1/1/2024 1/1/2024 1/1/2024 1/1/2024 1/1/2024
to to to to to
12/31/2024 12/31/2024 12/31/2024 12/31/2024 12/31/2024
OPERATIONS
Net investment income (loss) $ 531 $ (638) $ 289 $ (1,417) $ (8,536)
Capital gains distributions received 273 - 910 139,269 -
Net realized gain (loss) on shares redeemed (796) 1,720 17 (734) (24,861)
Net change in unrealized appreciation (depreciation) on investments (1,107) 47,296 (296) 106,025 672,464
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS (1,099) 48,378 920 243,143 639,067
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 1,787 1,253 297 9,073 3,420
Policy loans (2) (112) - (205) (298)
Policy loan repayments and interest - 759 - 7,500 13
Surrenders, withdrawals and death benefits (350) (422) (83) - (15,927)
Net transfers between other subaccounts
or fixed rate option 289 (1,913) 1,210 33,074 34,120
Miscellaneous transactions 5 26 - 31 (718)
Other charges (1,476) (2,414) (950) (41,217) (50,867)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS 253 (2,823) 474 8,256 (30,257)
TOTAL INCREASE (DECREASE) IN NET ASSETS (846) 45,555 1,394 251,399 608,810
NET ASSETS
Beginning of period 7,912 120,111 26,107 1,058,774 1,621,096
End of period $ 7,066 $ 165,666 $ 27,501 $ 1,310,173 $ 2,229,906
Beginning units 2,656 2,707 2,020 31,694 29,570
Units issued 769 38 117 1,205 447
Units redeemed (662) (102) (84) (960) (992)
Ending units 2,763 2,643 2,053 31,939 29,025


The accompanying notes are an integral part of these financial statements.
A17

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2024
SUBACCOUNTS
ProFund VP UltraSmall-Cap Rydex VT Nova Fund Rydex VT NASDAQ-100® Fund Rydex VT Inverse S&P 500® Strategy Fund Invesco V.I. Health Care Fund (Series I)
1/1/2024 1/1/2024 1/1/2024 1/1/2024 1/1/2024
to to to to to
12/31/2024 12/31/2024 12/31/2024 12/31/2024 12/31/2024
OPERATIONS
Net investment income (loss) $ (339) $ (1,270) $ (1,072) $ 2,833 $ (9,095)
Capital gains distributions received - - 3,264 - -
Net realized gain (loss) on shares redeemed (27) 1,476 3,544 (8,645) (1,031)
Net change in unrealized appreciation (depreciation) on investments 14,984 29,232 30,035 2,471 43,782
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 14,618 29,438 35,771 (3,341) 33,656
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 2,479 142 373 4,281 12,256
Policy loans (34) (2) - - (82)
Policy loan repayments and interest 4 - - 6,566 505
Surrenders, withdrawals and death benefits (15,694) (454) (3,257) - (1,577)
Net transfers between other subaccounts
or fixed rate option (8,262) 3,599 (5,534) (27,635) (51,118)
Miscellaneous transactions - - (1) (95) 26
Other charges (3,965) (1,185) (6,615) (367) (19,764)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS (25,472) 2,100 (15,034) (17,250) (59,754)
TOTAL INCREASE (DECREASE) IN NET ASSETS (10,854) 31,538 20,737 (20,591) (26,098)
NET ASSETS
Beginning of period 191,064 94,166 163,046 21,516 1,008,076
End of period $ 180,210 $ 125,704 $ 183,783 $ 925 $ 981,978
Beginning units 9,117 2,783 5,096 7,649 43,642
Units issued 315 100 6 4,097 626
Units redeemed (1,890) (41) (417) (10,553) (2,488)
Ending units 7,542 2,842 4,685 1,193 41,780


The accompanying notes are an integral part of these financial statements.
A18

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2024
SUBACCOUNTS
Invesco V.I. Technology Fund (Series I) Allspring VT Discovery All Cap Growth Fund (Class 1) Allspring VT Small Cap Growth Fund (Class 1) Invesco V.I. Diversified Dividend Fund (Series I) NVIT Fidelity Institutional AM® Emerging Markets Fund (Class D)
1/1/2024 1/1/2024 1/1/2024 1/1/2024 1/1/2024
to to to to to
12/31/2024 12/31/2024 12/31/2024 12/31/2024 12/31/2024
OPERATIONS
Net investment income (loss) $ (14,829) $ (35) $ (2,901) $ 6,091 $ 1,990
Capital gains distributions received 72,351 129 - 27,634 -
Net realized gain (loss) on shares redeemed (6,531) (4,380) (9,101) 6,787 10,909
Net change in unrealized appreciation (depreciation) on investments 412,203 4,721 61,672 36,654 17,757
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 463,194 435 49,670 77,166 30,656
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 25,993 579 2,834 20,799 14,270
Policy loans (209) - (8) (110) (41)
Policy loan repayments and interest 668 - 425 4,629 -
Surrenders, withdrawals and death benefits (4,748) (21,221) (28,144) (27,525) (51,647)
Net transfers between other subaccounts
or fixed rate option (23,339) 1,782 465 (11,218) (36,951)
Miscellaneous transactions 174 69 7 166 (440)
Other charges (41,423) (1,270) (8,661) (27,943) (21,504)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS (42,884) (20,061) (33,082) (41,202) (96,313)
TOTAL INCREASE (DECREASE) IN NET ASSETS 420,310 (19,626) 16,588 35,964 (65,657)
NET ASSETS
Beginning of period 1,421,691 23,949 307,295 654,186 561,578
End of period $ 1,842,001 $ 4,323 $ 323,883 $ 690,150 $ 495,921
Beginning units 59,974 918 12,711 27,895 52,918
Units issued 755 78 234 1,595 1,937
Units redeemed (2,284) (887) (1,994) (3,195) (10,356)
Ending units 58,445 109 10,951 26,295 44,499

The accompanying notes are an integral part of these financial statements.
A19

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2024
SUBACCOUNTS
AST PGIM Aggressive Multi-Asset Portfolio AST Core Fixed Income Portfolio Invesco V.I. Discovery Mid Cap Growth Fund (Series I) AST Global Bond Portfolio
AST Large-Cap Equity Portfolio
1/1/2024 1/1/2024 1/1/2024 1/1/2024 1/1/2024
to to to to to
12/31/2024 12/31/2024 12/31/2024 12/31/2024 12/31/2024
OPERATIONS
Net investment income (loss) $ (2,617) $ (41,520) $ (7,680) $ (3,943) $ (32,939)
Capital gains distributions received - - - - -
Net realized gain (loss) on shares redeemed 9,180 (72,461) (8,199) (980) 39,180
Net change in unrealized appreciation (depreciation) on investments 24,963 142,394 213,576 14,948 645,762
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 31,526 28,413 197,697 10,025 652,003
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 13,690 121,963 9,710 6,942 41,811
Policy loans (7) (2,035) (23) - (324)
Policy loan repayments and interest - 19,361 10 - 1,956
Surrenders, withdrawals and death benefits (6,263) (598,835) (39,761) - (6,094)
Net transfers between other subaccounts
or fixed rate option (1,441) 39,062 (102,000) 9,434 (52,300)
Miscellaneous transactions 18 (767) (40) 4 (216)
Other charges (16,824) (161,502) (33,209) (15,147) (80,918)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS (10,827) (582,753) (165,313) 1,233 (96,085)
TOTAL INCREASE (DECREASE) IN NET ASSETS 20,699 (554,340) 32,384 11,258 555,918
NET ASSETS
Beginning of period 253,039 5,788,242 943,164 508,045 2,886,511
End of period $ 273,738 $ 5,233,902 $ 975,548 $ 519,303 $ 3,442,429
Beginning units 18,739 566,993 71,559 56,073 271,596
Units issued 892 32,817 721 1,652 6,499
Units redeemed (1,618) (91,871) (12,336) (1,490) (14,595)
Ending units 18,013 507,939 59,944 56,235 263,500
The accompanying notes are an integral part of these financial statements.
A20

FINANCIAL STATEMENT OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F

STATEMENTS OF CHANGES IN NET ASSETS
For the period ended December 31, 2024
SUBACCOUNTS
AST Aggressive Asset Allocation Portfolio
AST Balanced Asset Allocation Portfolio
1/1/2024 12/6/2024*
to to
12/31/2024 12/31/2024
OPERATIONS
Net investment income (loss) $ (18,124) $ (983)
Capital gains distributions received - -
Net realized gain (loss) on shares redeemed 30,018 (1,087)
Net change in unrealized appreciation (depreciation) on investments 219,431 (53,345)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 231,325 (55,415)
CONTRACT OWNER TRANSACTIONS
Contract owner net payments 18,454 1,813
Policy loans (25) -
Policy loan repayments and interest 662 -
Surrenders, withdrawals and death benefits (71,303) (41,348)
Net transfers between other subaccounts
or fixed rate option 18,154 1,700,637
Miscellaneous transactions (112) (204)
Other charges (38,017) (3,428)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS (72,187) 1,657,470
TOTAL INCREASE (DECREASE) IN NET ASSETS 159,138 1,602,055
NET ASSETS
Beginning of period 1,790,821 -
End of period $ 1,949,959 $ 1,602,055
Beginning units 158,946 -
Units issued 6,091 173,828
Units redeemed (12,344) (8,433)
Ending units 152,693 165,395


*Date subaccount became available for investment.










The accompanying notes are an integral part of these financial statements.
A21
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F


Note 1: General
Fortitude Life Insurance & Annuity Company Variable Account F (the "Account", formerly Prudential Annuities Life Assurance Corporation Variable Account F) was established under the laws of the State of Connecticut on June 25, 1998 to fund variable life insurance products offered by Prudential Annuities Life Assurance Corporation ("PALAC", now known as Fortitude Life Insurance & Annuity Company ("FLIAC")). Prior to April 1, 2022, PALAC was a wholly-owned subsidiary of Prudential Annuities Inc. ("PAI") which was an indirect, wholly-owned subsidiary of Prudential Financial, Inc. ("Prudential Financial"). On April 1, 2022, PAI completed the sale of its equity interest in PALAC to Fortitude Group Holdings, LLC ("FGH"), the parent company of Fortitude Reinsurance Company, Ltd, and as a result, FLIAC became a wholly-owned subsidiary of FGH and is no longer an affiliate of Prudential Financial or any of its affiliates.

On April 1, 2022, FGH and Prudential Financial entered into an Administrative Service Agreement whereby Prudential Financial continues to administer and service the contracts noted below, including the payment of benefits and oversight of investment management.

Under applicable insurance law, the assets and liabilities of the Account are clearly identified and distinguished from the other assets and liabilities of FLIAC. The assets of the Account will not be charged with any liabilities arising out of any other business FLIAC may conduct. However, the Account's obligations, including insurance benefits related to the variable life insurance products listed below, are the obligations of FLIAC.

On August 30, 2013, PALAC received approval from the Arizona and Connecticut Departments of Insurance to redomesticate PALAC from Connecticut to Arizona effective August 31, 2013. As a result of the redomestication and sale, FLIAC is an Arizona insurance company and its principal insurance regulatory authority is the Arizona Department of Insurance. The Account is operated in accordance with the laws of Arizona. There was no impact to the operation of the Account.

The Account is registered with the Securities and Exchange Commission ("SEC") under the Investment Company Act of 1940, as amended, as a unit investment trust. The Account is a funding vehicle for five variable life insurance products issued by FLIAC (individually, a "contract" or "product" and collectively, the "contracts" or "products"). The following is a list of each contract funded through the Account.
Champion
SPVLI
Focus
Trophy
Horizon

The contracts offer the option to invest in various subaccounts listed below (collectively, the "Portfolios"). Investment options vary by contract.

The corresponding subaccount names are as follows:

AST Large-Cap Growth Portfolio
AST Government Money Market Portfolio
AST Cohen & Steers Realty Portfolio*
AST J.P. Morgan Conservative Multi-Asset Portfolio
AST High Yield Portfolio*
AST Large-Cap Value Portfolio
AST Small-Cap Equity Portfolio
AST T. Rowe Price Natural Resources Portfolio*
AST MFS Global Equity Portfolio*
AST International Equity Portfolio
ProFund VP Bear
A22
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)
ProFund VP UltraBull
ProFund VP Europe 30
ProFund VP Nasdaq-100
ProFund VP UltraNasdaq-100
ProFund VP UltraSmall-Cap
Rydex VT Nova Fund
Rydex VT NASDAQ-100® Fund
Rydex VT Inverse S&P 500® Strategy Fund
Invesco V.I. Health Care Fund (Series I)
Invesco V.I. Technology Fund (Series I)
Allspring VT Discovery All Cap Growth Fund (Class 1)
Allspring VT Small Cap Growth Fund (Class 1)
Invesco V.I. Diversified Dividend Fund (Series I)
NVIT Fidelity Institutional AM® Emerging Markets Fund (Class D) (formerly NVIT Emerging Markets Fund (Class D))
AST PGIM Aggressive Multi-Asset Portfolio (formerly AST Prudential Growth Allocation Portfolio)
AST Core Fixed Income Portfolio
Invesco V.I. Discovery Mid Cap Growth Fund (Series I)
AST Global Bond Portfolio*
AST Large-Cap Equity Portfolio (formerly AST Large-Cap Core Portfolio)
AST Aggressive Asset Allocation Portfolio (formerly AST Capital Growth Asset Allocation Portfolio)
AST Balanced Asset Allocation Portfolio

*
Subaccount merged during the period ended December 31, 2025.

The following table sets forth the dates at which mergers took place in the Account. The transfers from the removed subaccounts to the surviving subaccounts for the period ended December 31, 2025 are reflected in the Statements of Changes in Net Assets as net transfers between subaccounts and purchases and sales in Note 5.
Merger Date Removed Portfolio Surviving Portfolio
January 24, 2025 AST Cohen & Steers Realty Portfolio AST Large-Cap Equity Portfolio
January 24, 2025 AST T. Rowe Price Natural Resources Portfolio AST Large-Cap Equity Portfolio
January 24, 2025 AST MFS Global Equity Portfolio AST Large-Cap Equity Portfolio
February 7, 2025
AST High Yield Portfolio AST Core Fixed Income Portfolio
February 7, 2025
AST Global Bond Portfolio AST Core Fixed Income Portfolio

New sales of the products which invest in the Account have been discontinued. However, premium payments made by contract owners will continue to be received by the Account, subject to the rules of the products and any optional benefits, if elected.

The Portfolios are open-end management investment companies. Each subaccount of the Account indirectly bears exposure to risks which may be interrelated and include, but are not limited to, the market, credit and liquidity risks of the portfolio in which it invests. These financial statements should be read in conjunction with the financial statements and footnotes of the Portfolios. Additional information on these Portfolios is available upon request to the appropriate companies.

The Account is an independent accounting entity established by the resolution of the insurance company's board of directors or trustees to engage in a single line of business for the insurance company's variable contracts. The Account is comprised of multiple subaccounts to invest in its specific corresponding Portfolio. Each subaccount of the Account constitutes a single reportable segment because its separate financial information is available, regularly evaluated and used by the chief operating decision maker ("CODM") to measure the segment's performance, and also to assess the
A23
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)
allocation of resources across the segments. The accounting policies of the segments is the same as those described in Note 2: Significant Accounting Policies.

The Account's CODM is a group of executives that include FLIAC's Managing Director, Prudential's life company investment committee and the business leaders associated with each Account. Overall business decisions for the Account are made by this group of executives, including the investment strategy, capital allocation and expense structure of each subaccount, in accordance with the contract and applicable regulations. The measure of segment profit or loss is reported on the Statements of Operations as "Net Increase (Decrease) in Net Assets Resulting from Operations" and the measure of segment assets is reported as "Net Assets" on the Statements of Net Assets. Due to the nature of the business, the segment's significant expenses are charges for mortality and expense risk, charges for administration and/or reimbursement for excess expenses which are reported separately on the Statements of Operations and/or Statements of Changes in Net Assets.

Note 2: Significant Accounting Policies

The Account is an investment company and, accordingly, follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services-Investment Companies, which is part of the generally accepted accounting principles in the United States of America ("GAAP"). The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures at the date of the financial statements and the reported amounts of increases and decreases in net assets resulting from operations during the reporting period. Actual results could differ from those estimates. The most significant estimates relate to the valuation of investments in the Portfolios. Subsequent events have been evaluated through the date these financial statements were issued, and no adjustment or disclosure is required in the financial statements.

Investments - The investments in shares of the Portfolios are stated at the reported net asset value per share of the respective Portfolios, which is based on the fair value of the underlying securities in the respective Portfolios. All changes in fair value are recorded as net change in unrealized appreciation (depreciation) on investments in the Statements of Operations of the applicable subaccounts.

Security Transactions - Purchase and sale transactions are recorded as of the trade date of the security being purchased or sold. Realized gains and losses on security transactions are determined based upon the first in, first out method.

Dividend Income and Distributions Received - Dividend and capital gain distributions received are reinvested in additional shares of the Portfolios and are recorded on the ex-distribution date.

Note 3: Fair Value Measurements

Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative fair value guidance establishes a framework for measuring fair value that includes a hierarchy used to classify the inputs used in measuring fair value. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The levels of the fair value hierarchy are as follows:
Level 1 - Fair value is based on unadjusted quoted prices in active markets for identical assets or liabilities that the Account can access.
Level 2 - Fair value is based on significant inputs, other than Level 1 inputs, that are observable for the investment, either directly or indirectly, for substantially the full term of the investment through corroboration with observable market data. Level 2 inputs include the reported net asset value per share of the underlying portfolio, quoted market prices in active markets for similar investments, quoted market prices in markets that are not active for identical or similar investments, and other market observable inputs.
A24
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)

Level 3 - Fair value is based on at least one significant unobservable input for the investment, which may require significant judgment or estimation in determining the fair value.
As of December 31, 2025, management determined that the fair value inputs for all of the Account's investments, which consist solely of investments in open-end mutual funds registered with the SEC, were considered Level 2.

Note 4: Taxes

FLIAC is taxed as a "life insurance company" as defined by the Internal Revenue Code. The results of operations of the Account form a part of FLIAC's consolidated federal tax return. No federal, state or local income taxes are payable by the Account. As such, no provision for tax liability has been recorded in these financial statements. FLIAC management will review periodically the status of the policy in the event of changes in the tax law.

Note 5: Purchases and Sales of Investments

The aggregate costs of purchases and proceeds from sales, excluding distributions received and reinvested, of investments in the Portfolios for the period ended December 31, 2025 were as follows:
Purchases Sales
AST Large-Cap Growth Portfolio $ 303,075 $ 2,567,873
AST Government Money Market Portfolio 3,547,071 3,241,741
AST Cohen & Steers Realty Portfolio 1,764 1,491,451
AST J.P. Morgan Conservative Multi-Asset Portfolio 34,409 134,772
AST High Yield Portfolio 421 1,131,333
AST Large-Cap Value Portfolio 290,870 1,211,517
AST Small-Cap Equity Portfolio 257,371 692,778
AST T. Rowe Price Natural Resources Portfolio 301 839,383
AST MFS Global Equity Portfolio 59 1,264,208
AST International Equity Portfolio 108,231 544,481
ProFund VP Bear 1,874 1,499
ProFund VP UltraBull 71,603 29,675
ProFund VP Europe 30 618 17,593
ProFund VP Nasdaq-100 103,593 212,634
ProFund VP UltraNasdaq-100 75,327 149,250
ProFund VP UltraSmall-Cap 13,477 30,223
Rydex VT Nova Fund 18,520 3,194
Rydex VT NASDAQ-100® Fund 114 10,219
Rydex VT Inverse S&P 500® Strategy Fund 60,222 59,261
Invesco V.I. Health Care Fund (Series I) 26,115 140,994
Invesco V.I. Technology Fund (Series I) 56,551 114,566
Allspring VT Discovery All Cap Growth Fund (Class 1) 39,178 2,802
Allspring VT Small Cap Growth Fund (Class 1) 10,842 31,759
Invesco V.I. Diversified Dividend Fund (Series I) 34,088 70,678
NVIT Fidelity Institutional AM® Emerging Markets Fund (Class D) 27,903 123,089
AST PGIM Aggressive Multi-Asset Portfolio 50,711 89,903
AST Core Fixed Income Portfolio 1,909,541 832,010
Invesco V.I. Discovery Mid Cap Growth Fund (Series I) 55,501 58,023
AST Global Bond Portfolio 994 522,691
AST Large-Cap Equity Portfolio 3,714,178 1,066,017
AST Aggressive Asset Allocation Portfolio 37,331 88,669
AST Balanced Asset Allocation Portfolio 25,993 308,999


A25
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)

Note 6: Related Party Transactions

The Account had extensive transactions and relationships with Prudential Financial and its affiliates, which prior to April 1, 2022 were affiliated to the Account and PALAC. After the sale to FGH on April 1, 2022, Prudential Financial is no longer affiliated with the Account and FLIAC. Due to former affiliated relationships, it is possible that the terms of these transactions are not the same as those that would result from transactions among wholly unrelated parties. Prudential Financial and its affiliates perform various services on behalf of the portfolios in which the Account invests and may receive fees for the services performed.

There were no transactions with related parties during the period ended December 31, 2025.

Note 7: Financial Highlights

FLIAC sells a number of variable life insurance products that are funded through the Account. These products have unique combinations of features and fees that are charged against the contract owner's account balance. Differences in the fee structures result in a variety of unit values, expense ratios and total returns.

In the table below, the units outstanding, the ranges of lowest to highest unit values, the net assets, the investment income ratio, expense ratios, and total returns are presented for the products offered by FLIAC and funded through the Account. Only product designs within each subaccount that had units outstanding during the respective periods were considered when determining the ranges. The summary may not reflect the minimum and maximum contract charges as contract owners may not have selected all available contract options offered by FLIAC.

A26
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)
At the period ended
For the period ended
Units Outstanding
(000s) 		Unit Value
Lowest - Highest 		Net Assets (000s) Investment
Income
Ratio* 		Expense Ratio** Lowest - Highest Total Return*** Lowest - Highest
AST Large-Cap Growth Portfolio
December 31, 2025 421 $ 44.40 to $ 92.13 $ 25,917 0.00 % 0.50 % to 1.15 % 15.72 % to 16.48 %
December 31, 2024 457 $ 38.12 to $ 79.62 $ 24,290 0.00 % 0.50 % to 1.15 % 28.65 % to 29.50 %
December 31, 2023 404 $ 29.44 to $ 61.88 $ 16,958 0.00 % 0.50 % to 1.15 % 41.99 % to 42.92 %
December 31, 2022 441 $ 20.60 to $ 43.58 $ 13,097 0.00 % 0.50 % to 1.15 % -33.97 % to -33.54 %
December 31, 2021 93 $ 30.99 to $ 66.01 $ 4,373 0.00 % 0.50 % to 1.15 % 15.76 % to 16.53 %
AST Government Money Market Portfolio
December 31, 2025 323 $ 11.30 to $ 12.23 $ 3,745 3.71 % 0.50 % to 1.15 % 2.59 % to 3.26 %
December 31, 2024 293 $ 10.95 to $ 11.92 $ 3,312 4.65 % 0.50 % to 1.15 % 3.55 % to 4.23 %
December 31, 2023 305 $ 10.50 to $ 11.51 $ 3,327 4.54 % 0.50 % to 1.15 % 3.42 % to 4.10 %
December 31, 2022 279 $ 10.09 to $ 11.13 $ 2,912 1.12 % 0.50 % to 1.15 % 0.06 % to 0.72 %
December 31, 2021 444 $ 10.02 to $ 11.12 $ 4,773 0.00 % (2) 0.50 % to 1.15 % -1.15 % to -0.50 %
AST Cohen & Steers Realty Portfolio (merged January 24, 2025)
December 31, 2025 - $ 17.59 to $ 71.88 $ - 0.00 % 0.50 % to 1.15 % 1.61 % to 1.66 %
December 31, 2024 58 $ 17.31 to $ 70.74 $ 1,465 0.00 % 0.50 % to 1.15 % 5.44 % to 6.13 %
December 31, 2023 59 $ 16.30 to $ 67.09 $ 1,428 0.00 % 0.50 % to 1.15 % 10.80 % to 11.52 %
December 31, 2022 59 $ 14.62 to $ 60.55 $ 1,325 0.00 % 0.50 % to 1.15 % -26.22 % to -25.73 %
December 31, 2021 61 $ 19.69 to $ 82.07 $ 1,912 0.00 % 0.50 % to 1.15 % 41.21 % to 42.13 %
AST J.P. Morgan Conservative Multi-Asset Portfolio
December 31, 2025 51 $ 15.32 to $ 24.30 $ 950 0.00 % 0.50 % to 1.15 % 9.10 % to 9.82 %
December 31, 2024 55 $ 13.95 to $ 22.27 $ 953 0.00 % 0.50 % to 1.15 % 4.97 % to 5.66 %
December 31, 2023 56 $ 13.21 to $ 21.22 $ 927 0.00 % 0.50 % to 1.15 % 9.09 % to 9.80 %
December 31, 2022 62 $ 12.03 to $ 19.45 $ 922 0.00 % 0.50 % to 1.15 % -16.69 % to -16.15 %
December 31, 2021 56 $ 14.34 to $ 23.35 $ 959 0.00 % 0.50 % to 1.15 % 6.71 % to 7.41 %
AST High Yield Portfolio (merged February 7, 2025)
December 31, 2025 - $ 14.53 to $ 24.05 $ - 0.00 % 0.50 % to 1.15 % 1.36 % to 1.43 %
December 31, 2024 61 $ 14.33 to $ 23.73 $ 1,114 0.00 % 0.50 % to 1.15 % 6.33 % to 7.03 %
December 31, 2023 64 $ 13.39 to $ 22.32 $ 1,113 0.00 % 0.50 % to 1.15 % 9.29 % to 10.00 %
December 31, 2022 80 $ 12.17 to $ 20.42 $ 1,215 0.00 % 0.50 % to 1.15 % -12.53 % to -11.96 %
December 31, 2021 88 $ 13.82 to $ 23.35 $ 1,533 0.00 % 0.50 % to 1.15 % 5.11 % to 5.80 %
AST Large-Cap Value Portfolio
December 31, 2025 480 $ 25.25 to $ 42.48 $ 14,719 0.00 % 0.50 % to 1.15 % 14.72 % to 15.47 %
December 31, 2024 508 $ 21.87 to $ 37.03 $ 13,542 0.00 % 0.50 % to 1.15 % 8.66 % to 9.38 %
December 31, 2023 353 $ 19.99 to $ 34.08 $ 8,612 0.00 % 0.50 % to 1.15 % 8.49 % to 9.20 %
December 31, 2022 384 $ 18.31 to $ 31.41 $ 8,519 0.00 % 0.50 % to 1.15 % 0.54 % to 1.20 %
December 31, 2021 102 $ 18.09 to $ 31.24 $ 2,297 0.00 % 0.50 % to 1.15 % 27.73 % to 28.57 %
AST Small-Cap Equity Portfolio
December 31, 2025 237 $ 24.87 to $ 47.65 $ 7,463 0.00 % 0.50 % to 1.15 % 6.18 % to 6.87 %
December 31, 2024 250 $ 23.27 to $ 44.88 $ 7,367 0.00 % 0.50 % to 1.15 % 13.53 % to 14.28 %
December 31, 2023 86 $ 20.36 to $ 39.53 $ 2,338 0.00 % 0.50 % to 1.15 % 15.76 % to 16.51 %
December 31, 2022 87 $ 17.47 to $ 34.15 $ 2,064 0.00 % 0.50 % to 1.15 % -28.41 % to -27.94 %
December 31, 2021 33 $ 24.25 to $ 47.70 $ 1,346 0.00 % 0.50 % to 1.15 % 3.33 % to 4.01 %
AST T. Rowe Price Natural Resources Portfolio (merged January 24, 2025)
December 31, 2025 - $ 14.38 to $ 46.87 $ - 0.00 % 0.50 % to 1.15 % 8.78 % to 8.83 %
December 31, 2024 35 $ 13.22 to $ 43.08 $ 771 0.00 % 0.50 % to 1.15 % 2.65 % to 3.33 %
December 31, 2023 37 $ 12.79 to $ 41.97 $ 774 0.00 % 0.50 % to 1.15 % 0.19 % to 0.84 %
December 31, 2022 40 $ 12.68 to $ 41.89 $ 829 0.00 % 0.50 % to 1.15 % 4.87 % to 5.56 %
December 31, 2021 43 $ 12.02 to $ 39.94 $ 904 0.00 % 0.50 % to 1.15 % 22.37 % to 23.18 %
A27
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)
At the period ended
For the period ended
Units Outstanding
(000s) 		Unit Value
Lowest - Highest 		Net Assets (000s) Investment
Income
Ratio* 		Expense Ratio** Lowest - Highest Total Return*** Lowest - Highest
AST MFS Global Equity Portfolio (merged January 24, 2025)
December 31, 2025 - $ 19.05 to $ 42.55 $ - 0.00 % 0.50 % to 1.15 % 3.00 % to 3.05 %
December 31, 2024 54 $ 18.48 to $ 41.31 $ 1,226 0.00 % 0.50 % to 1.15 % 4.29 % to 4.98 %
December 31, 2023 53 $ 17.61 to $ 39.61 $ 1,151 0.00 % 0.50 % to 1.15 % 12.71 % to 13.45 %
December 31, 2022 56 $ 15.52 to $ 35.15 $ 1,098 0.00 % 0.50 % to 1.15 % -18.90 % to -18.37 %
December 31, 2021 59 $ 19.01 to $ 43.34 $ 1,467 0.00 % 0.50 % to 1.15 % 15.50 % to 16.26 %
AST International Equity Portfolio
December 31, 2025 162 $ 23.26 to $ 35.33 $ 4,571 0.00 % 0.50 % to 1.15 % 31.31 % to 32.17 %
December 31, 2024 181 $ 17.60 to $ 26.91 $ 3,828 0.00 % 0.50 % to 1.15 % 4.24 % to 4.93 %
December 31, 2023 199 $ 16.77 to $ 25.81 $ 4,114 0.00 % 0.50 % to 1.15 % 16.40 % to 17.17 %
December 31, 2022 99 $ 14.32 to $ 22.17 $ 1,747 0.00 % 0.50 % to 1.15 % -29.50 % to -29.04 %
December 31, 2021 107 $ 20.17 to $ 31.46 $ 2,732 0.00 % 0.50 % to 1.15 % 11.21 % to 11.94 %
ProFund VP Bear
December 31, 2025 3 $ 2.18 to $ 2.18 $ 6 2.92 % 0.50 % to 0.50 % -14.89 % to -14.89 %
December 31, 2024 3 $ 2.56 to $ 2.56 $ 7 7.87 % 0.50 % to 0.50 % -14.14 % to -14.14 %
December 31, 2023 3 $ 0.81 to $ 2.98 $ 8 0.20 % 0.50 % to 1.15 % -16.24 % to -15.69 %
December 31, 2022 5 $ 0.96 to $ 3.53 $ 19 0.00 % 0.50 % to 1.15 % 15.78 % to 16.53 %
December 31, 2021 3 $ 0.83 to $ 3.03 $ 9 0.00 % 0.50 % to 1.15 % -25.49 % to -25.00 %
ProFund VP UltraBull
December 31, 2025 3 $ 60.43 to $ 78.77 $ 250 0.80 % 0.50 % to 1.15 % 22.96 % to 23.76 %
December 31, 2024 3 $ 48.83 to $ 64.06 $ 166 0.68 % 0.50 % to 1.15 % 40.38 % to 41.30 %
December 31, 2023 3 $ 34.55 to $ 45.64 $ 120 0.00 % 0.50 % to 1.15 % 43.57 % to 44.51 %
December 31, 2022 3 $ 23.91 to $ 31.79 $ 104 0.00 % 0.50 % to 1.15 % -39.82 % to -39.42 %
December 31, 2021 3 $ 39.47 to $ 52.82 $ 138 0.00 % 0.50 % to 1.15 % 56.32 % to 57.35 %
ProFund VP Europe 30
December 31, 2025 1 $ 16.64 to $ 17.72 $ 18 2.40 % 0.50 % to 1.15 % 28.10 % to 28.94 %
December 31, 2024 2 $ 12.99 to $ 13.74 $ 28 1.86 % 0.50 % to 1.15 % 3.14 % to 3.83 %
December 31, 2023 2 $ 12.59 to $ 13.24 $ 26 2.15 % 0.50 % to 1.15 % 16.12 % to 16.88 %
December 31, 2022 2 $ 10.84 to $ 11.33 $ 23 1.30 % 0.50 % to 1.15 % -8.82 % to -8.22 %
December 31, 2021 3 $ 11.89 to $ 12.34 $ 31 0.90 % 0.50 % to 1.15 % 23.10 % to 23.91 %
ProFund VP Nasdaq-100
December 31, 2025 30 $ 48.33 to $ 53.91 $ 1,434 0.40 % 0.50 % to 1.15 % 17.26 % to 18.03 %
December 31, 2024 32 $ 40.95 to $ 45.98 $ 1,310 0.40 % 0.50 % to 1.15 % 22.00 % to 22.81 %
December 31, 2023 32 $ 33.34 to $ 37.68 $ 1,059 0.00 % 0.50 % to 1.15 % 50.43 % to 51.42 %
December 31, 2022 32 $ 22.02 to $ 25.05 $ 702 0.00 % 0.50 % to 1.15 % -34.67 % to -34.24 %
December 31, 2021 33 $ 33.48 to $ 38.34 $ 1,118 0.00 % 0.50 % to 1.15 % 23.37 % to 24.18 %
ProFund VP UltraNasdaq-100
December 31, 2025 28 $ 68.67 to $ 129.83 $ 2,784 0.23 % 0.50 % to 1.15 % 27.77 % to 28.61 %
December 31, 2024 29 $ 53.75 to $ 100.95 $ 2,230 0.30 % 0.50 % to 1.15 % 39.78 % to 40.70 %
December 31, 2023 30 $ 38.45 to $ 71.75 $ 1,621 0.00 % 0.50 % to 1.15 % 113.00 % to 114.39 %
December 31, 2022 31 $ 18.05 to $ 33.47 $ 807 0.00 % 0.50 % to 1.15 % -61.38 % to -61.13 %
December 31, 2021 31 $ 46.75 to $ 86.09 $ 2,098 0.00 % 0.50 % to 1.15 % 50.76 % to 51.75 %
ProFund VP UltraSmall-Cap
December 31, 2025 7 $ 18.79 to $ 33.26 $ 186 1.07 % 0.50 % to 1.15 % 11.63 % to 12.37 %
December 31, 2024 8 $ 16.72 to $ 29.80 $ 180 0.76 % 0.50 % to 1.15 % 9.42 % to 10.14 %
December 31, 2023 9 $ 15.18 to $ 27.23 $ 191 0.00 % 0.50 % to 1.15 % 21.03 % to 21.82 %
December 31, 2022 9 $ 12.46 to $ 22.50 $ 153 0.00 % 0.50 % to 1.15 % -44.33 % to -43.97 %
December 31, 2021 8 $ 22.24 to $ 40.42 $ 238 0.00 % 0.50 % to 1.15 % 21.89 % to 22.69 %
Rydex VT Nova Fund
December 31, 2025 3 $ 47.14 to $ 53.39 $ 171 0.00 % 0.50 % to 1.15 % 19.48 % to 20.26 %
December 31, 2024 3 $ 39.20 to $ 44.68 $ 126 0.00 % 0.50 % to 1.15 % 31.22 % to 32.09 %
December 31, 2023 3 $ 29.68 to $ 34.05 $ 94 0.00 % 0.50 % to 1.15 % 33.52 % to 34.40 %
December 31, 2022 3 $ 22.08 to $ 25.50 $ 71 0.41 % 0.50 % to 1.15 % -31.07 % to -30.61 %
December 31, 2021 4 $ 31.82 to $ 36.99 $ 132 0.38 % 0.50 % to 1.15 % 40.55 % to 41.47 %
A28
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)
At the period ended
For the period ended
Units Outstanding
(000s) 		Unit Value
Lowest - Highest 		Net Assets (000s) Investment
Income
Ratio* 		Expense Ratio** Lowest - Highest Total Return*** Lowest - Highest
Rydex VT NASDAQ-100® Fund
December 31, 2025 4 $ 43.04 to $ 49.87 $ 207 0.03 % 0.50 % to 1.15 % 17.67 % to 18.44 %
December 31, 2024 5 $ 36.57 to $ 42.11 $ 184 0.20 % 0.50 % to 1.15 % 22.47 % to 23.28 %
December 31, 2023 5 $ 29.86 to $ 34.15 $ 163 0.00 % 0.50 % to 1.15 % 51.47 % to 52.46 %
December 31, 2022 5 $ 19.72 to $ 22.40 $ 110 0.00 % 0.50 % to 1.15 % -34.90 % to -34.47 %
December 31, 2021 8 $ 30.28 to $ 34.19 $ 269 0.00 % 0.50 % to 1.15 % 24.10 % to 24.92 %
Rydex VT Inverse S&P 500® Strategy Fund
December 31, 2025 1 $ 0.68 to $ 0.68 $ 1 0.90 % 1.15 % to 1.15 % -12.78 % to -12.78 %
December 31, 2024 1 $ 0.78 to $ 2.66 $ 1 12.27 % 0.50 % to 1.15 % -14.11 % to -13.54 %
December 31, 2023 8 $ 0.90 to $ 3.08 $ 22 2.88 % 0.50 % to 1.15 % -15.94 % to -15.37 %
December 31, 2022 15 $ 1.07 to $ 3.64 $ 53 0.00 % 0.50 % to 1.15 % 15.25 % to 16.01 %
December 31, 2021 1 $ 0.93 to $ 0.93 $ 1 0.00 % 1.15 % to 1.15 % -25.31 % to -25.31 %
Invesco V.I. Health Care Fund (Series I)
December 31, 2025 37 $ 17.29 to $ 50.72 $ 1,007 0.00 % 0.50 % to 1.15 % 14.00 % to 14.75 %
December 31, 2024 42 $ 15.07 to $ 44.49 $ 982 0.00 % 0.50 % to 1.15 % 2.96 % to 3.64 %
December 31, 2023 44 $ 14.54 to $ 43.21 $ 1,008 0.00 % 0.50 % to 1.15 % 1.84 % to 2.51 %
December 31, 2022 45 $ 14.18 to $ 42.43 $ 1,030 0.00 % 0.50 % to 1.15 % -14.31 % to -13.75 %
December 31, 2021 49 $ 16.44 to $ 49.52 $ 1,366 0.21 % 0.50 % to 1.15 % 11.01 % to 11.74 %
Invesco V.I. Technology Fund (Series I)
December 31, 2025 57 $ 34.87 to $ 42.85 $ 2,151 0.00 % 0.50 % to 1.15 % 19.08 % to 19.86 %
December 31, 2024 58 $ 29.28 to $ 35.75 $ 1,842 0.00 % 0.50 % to 1.15 % 32.72 % to 33.59 %
December 31, 2023 60 $ 22.07 to $ 26.76 $ 1,422 0.00 % 0.50 % to 1.15 % 45.26 % to 46.21 %
December 31, 2022 64 $ 15.19 to $ 18.30 $ 1,041 0.00 % 0.50 % to 1.15 % -40.64 % to -40.25 %
December 31, 2021 72 $ 25.59 to $ 30.63 $ 1,957 0.00 % 0.50 % to 1.15 % 13.10 % to 13.84 %
Allspring VT Discovery All Cap Growth Fund (Class 1)
December 31, 2025 1 $ 34.22 to $ 74.45 $ 42 0.00 % 0.50 % to 1.15 % 14.20 % to 14.95 %
December 31, 2024 - (1) $ 29.77 to $ 65.19 $ 4 0.00 % 0.50 % to 1.15 % 19.90 % to 20.69 %
December 31, 2023 1 $ 24.66 to $ 54.37 $ 24 0.00 % 0.50 % to 1.15 % 31.97 % to 32.83 %
December 31, 2022 1 $ 18.57 to $ 41.20 $ 21 0.00 % 0.50 % to 1.15 % -37.77 % to -37.36 %
December 31, 2021 1 $ 29.64 to $ 66.21 $ 31 0.00 % 0.50 % to 1.15 % 13.94 % to 14.69 %
Allspring VT Small Cap Growth Fund (Class 1)
December 31, 2025 10 $ 22.96 to $ 40.71 $ 333 0.00 % 0.50 % to 1.15 % 8.29 % to 9.00 %
December 31, 2024 11 $ 21.07 to $ 37.59 $ 324 0.00 % 0.50 % to 1.15 % 17.69 % to 18.47 %
December 31, 2023 13 $ 17.78 to $ 31.94 $ 307 0.00 % 0.50 % to 1.15 % 3.16 % to 3.83 %
December 31, 2022 13 $ 17.13 to $ 30.96 $ 310 0.00 % 0.50 % to 1.15 % -35.05 % to -34.63 %
December 31, 2021 14 $ 26.20 to $ 47.68 $ 495 0.00 % 0.50 % to 1.15 % 6.69 % to 7.39 %
Invesco V.I. Diversified Dividend Fund (Series I)
December 31, 2025 25 $ 22.80 to $ 33.62 $ 761 1.61 % 0.50 % to 1.15 % 14.41 % to 15.16 %
December 31, 2024 26 $ 19.80 to $ 29.39 $ 690 1.88 % 0.50 % to 1.15 % 11.91 % to 12.65 %
December 31, 2023 28 $ 17.58 to $ 26.26 $ 654 2.02 % 0.50 % to 1.15 % 7.80 % to 8.50 %
December 31, 2022 29 $ 16.20 to $ 24.36 $ 618 1.89 % 0.50 % to 1.15 % -2.81 % to -2.17 %
December 31, 2021 28 $ 16.56 to $ 25.06 $ 628 2.16 % 0.50 % to 1.15 % 17.53 % to 18.30 %
NVIT Fidelity Institutional AM® Emerging Markets Fund (Class D)
December 31, 2025 38 $ 14.62 to $ 15.55 $ 564 0.32 % 0.50 % to 1.15 % 34.21 % to 35.09 %
December 31, 2024 44 $ 10.89 to $ 11.51 $ 496 1.25 % 0.50 % to 1.15 % 4.76 % to 5.45 %
December 31, 2023 53 $ 10.40 to $ 10.91 $ 562 1.06 % 0.50 % to 1.15 % 2.61 % to 3.29 %
December 31, 2022 87 $ 10.13 to $ 10.57 $ 893 0.17 % 0.50 % to 1.15 % -25.86 % to -25.37 %
December 31, 2021 90 $ 13.67 to $ 14.16 $ 1,242 0.89 % 0.50 % to 1.15 % -8.65 % to -8.05 %
AST PGIM Aggressive Multi-Asset Portfolio
December 31, 2025 16 $ 17.19 to $ 18.19 $ 272 0.00 % 0.50 % to 1.15 % 14.67 % to 15.42 %
December 31, 2024 18 $ 14.99 to $ 15.76 $ 274 0.00 % 0.50 % to 1.15 % 12.37 % to 13.12 %
December 31, 2023 19 $ 13.34 to $ 13.93 $ 253 0.00 % 0.50 % to 1.15 % 16.71 % to 17.47 %
December 31, 2022 23 $ 11.43 to $ 11.86 $ 270 0.00 % 0.50 % to 1.15 % -19.24 % to -18.71 %
December 31, 2021 31 $ 14.15 to $ 14.59 $ 435 0.00 % 0.50 % to 1.15 % 15.36 % to 16.12 %
A29
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)
At the period ended
For the period ended
Units Outstanding
(000s) 		Unit Value
Lowest - Highest 		Net Assets (000s) Investment
Income
Ratio* 		Expense Ratio** Lowest - Highest Total Return*** Lowest - Highest
AST Core Fixed Income Portfolio
December 31, 2025 618 $ 10.64 to $ 11.16 $ 6,760 0.00 % 0.50 % to 1.15 % 5.92 % to 6.62 %
December 31, 2024 508 $ 10.05 to $ 10.47 $ 5,234 0.00 % 0.50 % to 1.15 % 0.26 % to 0.93 %
December 31, 2023 567 $ 10.02 to $ 10.37 $ 5,788 0.00 % 0.50 % to 1.15 % 5.13 % to 5.82 %
December 31, 2022 589 $ 9.53 to $ 9.80 $ 5,699 0.00 % 0.50 % to 1.15 % -17.25 % to -16.70 %
December 31, 2021 109 $ 11.52 to $ 11.77 $ 1,269 0.00 % 0.50 % to 1.15 % -3.36 % to -2.73 %
Invesco V.I. Discovery Mid Cap Growth Fund (Series I)
December 31, 2025 60 $ 16.54 to $ 17.17 $ 1,022 0.00 % 0.50 % to 1.15 % 3.58 % to 4.27 %
December 31, 2024 60 $ 15.97 to $ 16.46 $ 976 0.00 % 0.50 % to 1.15 % 22.80 % to 23.61 %
December 31, 2023 72 $ 13.00 to $ 13.32 $ 943 0.00 % 0.50 % to 1.15 % 11.85 % to 12.59 %
December 31, 2022 74 $ 11.63 to $ 11.83 $ 866 0.00 % 0.50 % to 1.15 % -31.77 % to -31.33 %
December 31, 2021 75 $ 17.04 to $ 17.23 $ 1,289 0.00 % 0.50 % to 1.15 % 17.73 % to 18.50 %
AST Global Bond Portfolio (merged February 7, 2025)
December 31, 2025 - $ 9.13 to $ 9.38 $ - 0.00 % 0.50 % to 1.15 % 0.43 % to 0.50 %
December 31, 2024 56 $ 9.09 to $ 9.34 $ 519 0.00 % 0.50 % to 1.15 % 1.55 % to 2.22 %
December 31, 2023 56 $ 8.95 to $ 9.13 $ 508 0.00 % 0.50 % to 1.15 % 5.07 % to 5.76 %
December 31, 2022 69 $ 8.52 to $ 8.64 $ 590 0.00 % 0.50 % to 1.15 % -13.20 % to -12.63 %
December 31, 2021 85 $ 9.81 to $ 9.89 $ 841 0.00 % 0.50 % to 1.15 % -2.59 % to -1.96 %
AST Large-Cap Equity Portfolio (available October 15, 2021)
December 31, 2025 462 $ 14.76 to $ 15.18 $ 6,887 0.00 % 0.50 % to 1.15 % 13.56 % to 14.31 %
December 31, 2024 264 $ 13.00 to $ 13.28 $ 3,442 0.00 % 0.50 % to 1.15 % 22.71 % to 23.52 %
December 31, 2023 272 $ 10.59 to $ 10.75 $ 2,887 0.00 % 0.50 % to 1.15 % 21.69 % to 22.48 %
December 31, 2022 296 $ 8.71 to $ 8.78 $ 2,585 0.00 % 0.50 % to 1.15 % -17.95 % to -17.41 %
December 31, 2021 334 $ 10.61 to $ 10.63 $ 3,541 0.00 % 0.50 % to 1.15 % 5.20 % to 5.35 %
AST Aggressive Asset Allocation Portfolio (available February 24, 2023)
December 31, 2025 150 $ 14.61 to $ 14.88 $ 2,208 0.00 % 0.50 % to 1.15 % 14.83 % to 15.59 %
December 31, 2024 153 $ 12.72 to $ 12.88 $ 1,950 0.00 % 0.50 % to 1.15 % 13.08 % to 13.83 %
December 31, 2023 159 $ 11.25 to $ 11.31 $ 1,791 0.00 % 0.50 % to 1.15 % 13.58 % to 14.21 %
December 31, 2022 - $ - to $ - $ - 0.00 % 0.00 % to 0.00 % 0.00 % to 0.00 %
December 31, 2021 - $ - to $ - $ - 0.00 % 0.00 % to 0.00 % 0.00 % to 0.00 %
AST Balanced Asset Allocation Portfolio (available December 6, 2024)
December 31, 2025 139 $ 10.95 to $ 11.02 $ 1,524 0.00 % 0.50 % to 1.15 % 13.03 % to 13.78 %
December 31, 2024 165 $ 9.68 to $ 9.69 $ 1,602 0.00 % 0.50 % to 1.15 % -3.32 % to -3.28 %
December 31, 2023 - $ - to $ - $ - 0.00 % 0.00 % to 0.00 % 0.00 % to 0.00 %
December 31, 2022 - $ - to $ - $ - 0.00 % 0.00 % to 0.00 % 0.00 % to 0.00 %
December 31, 2021 - $ - to $ - $ - 0.00 % 0.00 % to 0.00 % 0.00 % to 0.00 %


A30
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)
*
These amounts represent the dividends, excluding distributions of capital gains, received by the subaccount from the underlying Portfolios, net of management fees assessed by the fund manager, divided by the average daily net assets. These ratios exclude those expenses, such as mortality and expense risk and administration charges, that result in direct reductions in the unit values. The recognition of investment income by the subaccount is affected by the timing of the declaration of dividends by the underlying Portfolios in which the subaccount invests.
**
These amounts represent the annualized contract expenses of the Account, consisting primarily of mortality and expense risk and administration charges, for each period indicated. The ratios include only those expenses that result in a direct reduction to unit values. Charges made directly to contract owner accounts through the redemption of units and expenses of the underlying Portfolios are excluded.
***
These amounts represent the total returns for the periods indicated, including changes in the value of the underlying Portfolios, and reflect deductions for all items included in the expense ratio. The total return does not include any expenses assessed through the redemption of units; inclusion of these expenses in the calculation would result in a reduction in the total return presented. Product designs within a subaccount which were offered less than one year are included in the range of total returns for that period, and their respective total returns may not correspond to the total returns of a product offering with a comparable expense ratio that was presented for the full period. Contract owners may experience different total returns based on their investment options. Subaccounts with a date notation indicate the effective date of that subaccount in the Account. Total returns for periods less than one year are not annualized. The total return is calculated for each of the five periods preceding December 31, 2025 or for the periods indicated within.
(1)
Amount is less than 1,000 units.
(2)
Amount is less than 0.01%.

Note 8: Charges and Expenses

The following represents the various charges and expenses of the Account which are paid to FLIAC.

Each contract funded through the Account is subject to specific fees and charges, some of which are deducted as an asset-based charge by the Account, while others are deducted monthly, annually or at the time that certain transactions are made.

Mortality and Expense Risk Charges - The mortality and expense risk charges of 0.90% per year is deducted from each subaccount. The mortality and expense risk charges are expressed as an annual charge; however, the daily equivalent is deducted on a daily basis from the net assets of each subaccount. With respect to the SPVLI, Focus and Horizon products, the mortality and expense risk charges decrease to 0.25% annually after the fifteenth contract year. Beginning in 2015, certain contracts reached their fifteenth year. These charges are assessed through a reduction in unit values.

Administration Charge - The administration charge of 0.25% per year is deducted from each subaccount. The administration charge is expressed as an annual charge; however, the daily equivalent is deducted on a daily basis from the net assets of each subaccount. This charge is assessed through a reduction in unit values.

Maintenance Fee - With respect to the SPVLI and Trophy products, a maintenance fee of $2.50 per month is deducted. The maintenance fee is waived if the account value is $75,000 or greater. There is no monthly maintenance fee for Champion, Focus, or Horizon. This charge is assessed through the redemption of units.

Sales Charge - A sales charge is deducted during the first ten contract years by the Account. With respect to the SPVLI product, the sales charge is 0.25% per year; the sales charge for the Trophy, Champion, Focus and Horizon products is 0.40% per year for years 1-10. The sales charge is expressed as an annual charge; however, the monthly equivalent is deducted on a monthly basis from the assets of the Account. This charge is assessed through the redemption of units.
A31
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)
Cost of Insurance Charge - The cost of insurance charge is deducted on a monthly basis pro-rata from the variable investment options in the Account and any fixed investment options. This charge is assessed through the redemption of units.

With respect to the SPVLI product the cost of insurance charge is deducted as an asset-based charge ranging from 0.50% to 2.50% per year and ranging from 0.40% to 1.25% for the Trophy product depending on the contract owner's age on the issue date of the contract, gender and tobacco use risk class.

With respect to the Champion, Focus and Horizon, the cost of insurance charge varies depending on a number of factors, including the contract owner's age at issue, gender (where permitted), tobacco usage class and risk class of each insured. The charge is assessed as an amount per $1 of net amount at risk plus a $12 monthly fee. Please refer to the product prospectus for a complete description of the cost of insurance charge.

Premium Tax - A charge is deducted from each premium in relation to state and local premium taxes we may incur on that premium. In most jurisdictions these rates range from 0% to 3.5% of each premium. These charges are deducted before the net amount is allocated to the investment options in the Account. Premium taxes are deducted on the Champion, Focus, and Horizon products only.

DAC Tax - A charge is deducted in relation to the deferred acquisition cost ("DAC") tax incurred by Prudential Annuities. The charge is equal to 1.15% and is deducted from each premium payment. This charge is deducted before the net amount is allocated to the investment options in the Account. The deferred acquisition tax charge is deducted on the Champion, Focus, and Horizon products only.

Transfer Fees - Transfer fees are charged at a rate of $10 for each transfer after the 20th transfer in each contract year, as set forth in the respective prospectuses. These charges are assessed through the redemption of units.

Partial Withdrawal/Transaction Fee - A fee of $25 may be charged for each partial withdrawal. The partial withdrawal transaction fee is deducted on the Champion, Focus, and Horizon products only. This charge is assessed through the redemption of units.

Note 9: Other

Accumulation units are the contract owner's interest allocated to the variable account during the accumulation period of the contract.

Contract owner net payments represent contract owner contributions, net of applicable deductions, charges, and state premium taxes.

Policy loans represent amounts borrowed by contract owners using the contract as the security for the loan.

Policy loan repayments and interest represent payments made by contract owners to reduce the total outstanding policy loan principal plus accrued interest.

Surrenders, withdrawals and death benefits are payments to contract owners and beneficiaries made under the terms of the contracts, including amounts that contract owners have requested to be withdrawn or paid to them.

Net transfers between other subaccounts or fixed rate option are amounts that contract owners have directed to be moved among subaccounts, including permitted transfers to and from the guaranteed interest account.

A32
NOTES TO FINANCIAL STATEMENTS OF
FORTITUDE LIFE INSURANCE & ANNUITY COMPANY VARIABLE ACCOUNT F-(Continued)
Miscellaneous transactions primarily represent timing related adjustments on contract owner transactions, such as premiums, surrenders, transfers, etc. which are funded by the general account in order to maintain appropriate contract owner account balances.

Other charges are contract level charges assessed through the redemption of units as described in Note 8, Charges and Expenses.

A33

Report of Independent Registered Public Accounting Firm

To the Board of Directors of Fortitude Life Insurance & Annuity Company and the Contract Owners of Fortitude Life Insurance & Annuity Company Variable Account F

Opinions on the Financial Statements

We have audited the accompanying statements of net assets of each of the subaccounts of Fortitude Life Insurance & Annuity Company Variable Account F indicated in the table below as of the dates indicated in the table below, and the related statements of operations and of changes in net assets for each of the periods indicated in the table below, including the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of each of the subaccounts of Fortitude Life Insurance & Annuity Company Variable Account F as of the dates indicated in the table below, and the results of each of their operations, and the changes in each of their net assets for the periods indicated in the table below, in conformity with accounting principles generally accepted in the United States of America.

AST Large-Cap Growth Portfolio (1) Rydex VT Nova Fund (1)
AST Government Money Market Portfolio (1) Rydex VT NASDAQ-100® Fund (1)
AST Cohen & Steers Realty Portfolio (2) Rydex VT Inverse S&P 500® Strategy Fund (1)
AST J.P. Morgan Conservative Multi-Asset Portfolio (1) Invesco V.I. Health Care Fund (Series I) (1)
AST High Yield Portfolio (3) Invesco V.I. Technology Fund (Series I) (1)
AST Large-Cap Value Portfolio (1) Allspring VT Discovery All Cap Growth Fund (Class 1) (1)
AST Small-Cap Equity Portfolio (1) Allspring VT Small Cap Growth Fund (Class 1) (1)
AST T. Rowe Price Natural Resources Portfolio (2) Invesco V.I. Diversified Dividend Fund (Series I) (1)
AST MFS Global Equity Portfolio (2) NVIT Fidelity Institutional AM® Emerging Markets Fund (Class D) (1)
AST International Equity Portfolio (1) AST PGIM Aggressive Multi-Asset Portfolio (1)
ProFund VP Bear (1) AST Core Fixed Income Portfolio (1)
ProFund VP UltraBull (1) Invesco V.I. Discovery Mid Cap Growth Fund (Series I) (1)
ProFund VP Europe 30 (1) AST Global Bond Portfolio (3)
ProFund VP Nasdaq-100 (1) AST Large-Cap Equity Portfolio (1)
ProFund VP UltraNasdaq-100 (1) AST Aggressive Asset Allocation Portfolio (1)
ProFund VP UltraSmall-Cap (1) AST Balanced Asset Allocation Portfolio (4)
(1) Statement of net assets as of December 31, 2025, statement of operations for the year ended December 31, 2025 and statement of changes in net assets for the years ended December 31, 2025 and 2024.
(2) Statement of net assets as of January 24, 2025 (date of merger), statement of operations for the period January 1, 2025 to January 24, 2025 (date of merger) and statement of changes in net assets for the period January 1, 2025 to January 24, 2025 (date of merger) and for the year ended December 31, 2024.
(3) Statement of net assets as of February 7, 2025 (date of merger), statement of operations for the period January 1, 2025 to February 7, 2025 (date of merger) and statement of changes in net assets for the period January 1, 2025 to February 7, 2025 (date of merger) and for the year ended December 31, 2024.
(4) Statement of net assets as of December 31, 2025, statement of operations for the year ended December 31, 2025 and statement of changes in net assets for the year ended December 31, 2025 and for the period December 6, 2024 (commencement of operations) to December 31, 2024.

Basis for Opinions

These financial statements are the responsibility of the Fortitude Life Insurance & Annuity Company management. Our responsibility is to express an opinion on the financial statements of each of the subaccounts of Fortitude Life Insurance & Annuity Company Variable Account F based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to each of the subaccounts of Fortitude Life Insurance & Annuity Company Variable Account F in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

A34

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of investments owned as of December 31, 2025 by correspondence with the transfer agents of the investee mutual funds. We believe that our audits provide a reasonable basis for our opinions.






/s/ PricewaterhouseCoopers LLP
New York, New York
April 27, 2026

We have served as the auditor of one or more of the subaccounts of Fortitude Life Insurance & Annuity Company Variable Account F since at least 2013. We have not been able to determine the specific year we began serving as auditor of one or more of the subaccounts of Fortitude Life Insurance & Annuity Company Variable Account F.


A35
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _________________________________________________________ FORM 10-K _________________________________________________________ ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED December 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER 033-44202 _________________________________________________________ Fortitude Life Insurance & Annuity Company (Exact Name of Registrant as Specified in its Charter) Arizona 06-1241288 (State or Other Jurisdiction of Incorporation or Organization) (I.R.S. Employer Identification Number) Ten Exchange Place Suite 2210 Jersey City, NJ 07302 (615) 981-8801 (Address and Telephone Number of Registrant's Principal Executive Offices) SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒ Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of the Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☐ Emerging growth company ☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐ If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐ Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.) Yes ☐ No ☒ Table of Contents
As of March 19, 2026, 25,000 shares of the registrant's Common Stock (par value $100) consisting of 100 voting shares and 24,900 non- voting shares, were outstanding. As of such date, Fortitude Group Holdings, LLC, a Delaware limited liability company, owned all of the registrant's Common Stock. Table of Contents
TABLE OF CONTENTS Page PART I Item 1. Business 5 Item 1A. Risk Factors 17 Item 1B. Unresolved Staff Comments 26 Item 1C. Cybersecurity 26 Item 2. Properties 28 Item 3. Legal Proceedings 28 Item 4. Mine Safety Disclosures 28 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 29 Item 6. [Reserved] 29 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 29 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 42 Item 8. Financial Statements and Supplementary Data 46 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 107 Item 9A. Controls and Procedures 107 Item 9B. Other Information 107 Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections 107 PART III Item 10. Directors, Executive Officers and Corporate Governance 108 Item 11. Executive Compensation 119 Item 12. Security Ownership of Certain Beneficial Owners and Management 119 Item 13. Certain Relationships and Related Transactions and Director Independence 120 Item 14. Principal Accountant Fees and Services 115 PART IV Item 15. Exhibits and Financial Statement Schedules 116 Item 16. Form 10-K Summary 117 SIGNATURES 118 Table of Contents 3
FORWARD-LOOKING STATEMENTS Certain of the statements included in this Annual Report on Form 10-K constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as "expects," "believes," "anticipates," "plans," "assumes," "estimates," "projects," "intends," "should," "will," "shall" or variations of such words are generally part of forward-looking statements. Forward-looking statements are made based on management's current expectations and beliefs concerning future developments and their potential effects upon Fortitude Life Insurance & Annuity Company (FLIAC). There can be no assurance that future developments affecting FLIAC will be those anticipated by management. These forward- looking statements are not a guarantee of future performance and involve risks and uncertainties, and there are certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected in such forward- looking statements, including, among others: (1) the ongoing impact of the uncertain and evolving economic environment on the global economy, financial market and our business; (2) losses on investments or financial contracts due to deterioration in credit quality or value, or counterparty default; (3) losses on insurance products due to mortality experience or policyholder behavior experience that differs significantly from our expectations when we price our products; (4) changes in interest rates and equity prices that may (a) adversely impact the profitability of our products, the value of separate accounts supporting these products or the value of assets we manage, (b) result in losses on derivatives we use to hedge risk or increase collateral posting requirements and (c) limit opportunities to invest at appropriate returns; (5) guarantees within certain of our products which are market sensitive and may decrease our earnings or increase the volatility of our results of operations or financial position; (6) liquidity needs resulting from (a) derivative collateral market exposure, (b) asset/liability mismatches, (c) the lack of available funding in the financial markets or (d) unexpected cash demands due to severe mortality calamity or lapse events; (7) financial or customer losses, or regulatory and legal actions, due to inadequate or failed processes or systems, external events, and human error or misconduct such as (a) disruption of our systems and data, (b) an information security breach, (c) a failure to protect the privacy of sensitive data, (d) reliance on third-parties or (e) labor and employment matters; (8) changes in the regulatory landscape, including related to (a) financial sector regulatory reform, (b) changes in tax laws, (c) fiduciary rules and other standards of care, (d) state insurance laws and developments regarding group-wide supervision, capital and reserves, or (e) privacy and cybersecurity regulation; (9) technological changes which may adversely impact companies in our investment portfolio or cause insurance experience to deviate from our assumptions; (10) ratings downgrades; (11) market conditions that may adversely affect the sales or persistency of our products; (12) competition; and (13) reputational damage. FLIAC does not intend, and is under no obligation, to update any particular forward-looking statement included in this document. See "Risk Factors" included in this Annual Report on Form 10-K for discussion of certain risks relating to our business and investment in our securities. Table of Contents 4
PART 1 Item 1. Business Overview Fortitude Life Insurance & Annuity Company and its wholly-owned subsidiaries (collectively, "FLIAC", "we", or the "Company"), with its principal offices in Jersey City, New Jersey, is a wholly-owned subsidiary of Fortitude Group Holdings, LLC ("FGH") and an indirect wholly-owned subsidiary of FGH Parent L.P. ("FGP"). Product Information Annuity Products The Company has issued variable, index-linked, and fixed deferred and immediate annuities for individuals and groups in the United States of America and Puerto Rico. In addition, the Company has a relatively small in-force block of variable life insurance policies. The Company has ceased all new sales of its insurance products but has entered into reinsurance agreements to assume certain annuity business. The Company surrendered its New York license effective December 31, 2015, and reinsured the majority of its New York business to The Prudential Insurance Company of America ("Prudential Insurance"). The license surrender relieved the Company of the requirement to hold New York statutory reserves on its business in excess of the statutory reserves required by its domiciliary regulator, the Arizona Department of Insurance and Financial Institutions ("Arizona DIFI"). For the small portion of New York business retained by the Company, a custodial account has been established to hold collateral assets in an amount equal to a percentage of the reserves associated with such business, as calculated in accordance with PALAC's New York Regulation 109 Plan approved by the New York State Department of Financial Services. Funding Agreements The Company has issued funding agreements to Fortitude Global Funding, an unaffiliated statutory trust, under a funding agreement backed note ("FABN") program. The funding agreements have matching interest and maturity payment terms with the applicable notes issued under the FABN program. Business Segmentation The Company separates its business into two reportable segments, which are referred to as the "Retained Business" and the "Ceded Business". The Retained Business primarily consists of variable annuity products with guaranteed lifetime withdrawal benefit features as well as smaller blocks of variable annuity products with certain other living benefit and death benefit features. The Retained Business also includes variable universal life and fixed payout annuity products. The Retained Business is actively managed by FLIAC management. The Ceded Business represents the following: • Registered index-linked annuities and fixed annuities, which includes fixed indexed and fixed deferred annuities, and other variable annuities, where 100 percent of the assets and liabilities have been fully ceded to The Prudential Insurance Company of America ("Prudential Insurance") and Pruco Life Insurance Company ("Pruco Life") under existing coinsurance and modified coinsurance agreements. • Funding agreements associated with a FABN program where at least 85 percent of the liabilities have been ceded, on a modified coinsurance basis, to a Bermuda-domiciled affiliate of the Company. The entirety of the funding agreement business is included within this segment. See "Funding Agreements and Funding Agreement Backed Notes (FABN)" contained within "Overview" in Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operation for further information. • Certain assumed deferred annuities where 100% percent of the liabilities are retroceded to a Bermuda-domiciled affiliate of the Company. See "Reinsurance" herein Item 1 for further information. Table of Contents 5
Novation of Ceded Business In 2022, in accordance with applicable state law, a program was instituted to novate a significant portion of the Ceded Business policies from FLIAC to Pruco Life. The program did not have an impact on total equity or net income but has resulted in the reduction of certain activity/balances associated with these policies. During the year ended December 31, 2023, approximately $641 million of account value, which generally approximates fair values of insurance liabilities, was transferred out of the Company as a result of the novation program. There was no significant novation activity during 2025 and 2024 and we do not expect significant future novation activity under the program. Since the acquisition of the Company in April 2022, approximately 73 percent of account value in the Ceded Business has been novated to Pruco Life under this program. Revenues and Profitability Our revenues primarily come in the form of: • Policy charges and fee income representing mortality, expense, and other fees for various insurance-related options and features based on the average daily net asset value of the annuity separate accounts, account value, premium, or guaranteed value, as applicable. • Fee income from administrative services and distribution fees from certain mutual funds that underlie our variable products. We also receive income in the form of revenue-sharing from advisers who provide asset management services to the underlying mutual funds. Such income is generally determined as a percentage of the average assets attributable to our products in the underlying funds. • Investment income. Our profitability is substantially impacted by assumptions made at the time FGH acquired the Company, which were based on: • An evaluation of the risks assumed and consideration of applicable risk management strategies, including hedging and reinsurance costs. • Assumptions regarding investment returns and contractholder behavior, including persistency, benefit utilization and the timing and efficiency of withdrawals for contracts with living benefit features, as well as other assumptions. Competition We compete with other providers of retirement savings and accumulation products, including larger, more well-established insurance and financial services companies. Although the Company is not actively selling new policies, we believe our existing product features and customer service capabilities, supplemented with our risk management strategies, provide an attractive value for the retention of existing customers. Retained Business Strategies We manage the Retained Business with a focus on long-term economics and a willingness to sustain short-term volatility in our earnings, while remaining consistent with our risk appetite framework. Our overall business strategy is to generate above market risk adjusted returns by: • Ensuring we have a strong statutory balance sheet following capital market stresses, including but not limited to, sharp reductions in equity prices and interest rates and increases in credit spreads, • Leveraging our investment capabilities to deploy a portion of our asset portfolio into private fixed income securities with a sufficiently wide spread to comparable public securities, and • Investing in high-quality liquid public fixed income securities and preserving a cash balance sufficient to pay current claims and expenses, while maintaining collateral to satisfy margin requirements in connection with the derivative transactions forming our Asset Liability Matching (ALM) strategy, as described below. Table of Contents 6
The primary risk exposures of our Retained Business relate to actual deviations from, or changes to, the pricing assumptions developed at acquisition for these products, including capital markets assumptions such as equity market returns, interest rates and market volatility, along with actuarial assumptions such as contractholder mortality, the timing and amount of annuitization and withdrawals, and contract lapses. For these risk exposures, achievement of our expected returns is subject to the risk that actual experience will differ from the pricing assumptions developed at acquisition for these products. We have developed and implemented a risk management strategy to mitigate the potential adverse effects of fluctuations in capital markets, specifically equity markets and interest rates, primarily through a combination of i) Product Design Features and ii) our ALM strategy. Product Design Features Certain contractual design features for our Retained Business products help us manage our risk. For example, a portion of the variable annuity contracts with guaranteed benefit riders includes an asset transfer feature which automatically transfers assets between certain variable investment sub-accounts selected by the annuity contractholder to, depending on the benefit feature, a fixed-rate account in the general account or a bond fund sub-account within the separate account. The purpose of the asset transfer feature is to reduce our risk under the guaranteed benefit riders by reducing our exposure to equity market risk and market volatility. The transfers are based on a static mathematical formula used with the particular benefit which considers a number of factors, including, but not limited to, the impact of investment performance on the contractholder's total account value. Other risk-reducing product design features include, among others, asset allocation restrictions, minimum issuance age requirements and certain limitations on the amount of contractholder purchase payments. ALM Strategy We employ an ALM strategy that utilizes a combination of both fixed income instruments and derivatives to meet expected claims associated with our variable annuity living and death benefit guarantees. The economic liability we manage with this ALM strategy consists of expected living and death benefit claims net of expected separate account fee revenue. For the portion of our ALM strategy executed with derivatives, we enter into a range of exchange-traded and over-the-counter ("OTC") equity, interest rate and credit derivatives, including, but not limited to the following: • Interest rate contracts: swaps, swaptions, futures, forwards, options, caps and floors; • Equity contracts: futures, options, and total return swaps; • Foreign exchange contracts: futures, options, forwards and swaps; and • Credit contracts: single and index reference credit default swaps. The intent of our ALM strategy is to more efficiently manage the capital and liquidity associated with these products. We explicitly consider liquidity and risk-based capital as well as current market conditions in our asset/liability management strategies. See Item 7A "Quantitative and Qualitative Disclosures About Market Risk" for discussion regarding interest and equity risks. Reinsurance The Company has entered into reinsurance agreements as both a ceding entity and an assuming entity. As a ceding entity, the exposure to the risks reinsured is reduced by transferring certain rights and obligations of the underlying insurance product to a counterparty. We enter into reinsurance agreements as the ceding entity for a variety of reasons but primarily do so to reduce exposure to loss, reduce risk volatility, provide additional capacity for future growth and for capital management purposes for certain of our optional living benefit features. Under ceded reinsurance, we remain liable to the underlying policyholder if a third-party reinsurer is unable to meet its obligations. We evaluate the financial condition of reinsurers, monitor the concentration of counterparty risk and maintain collateral, as appropriate, to mitigate this exposure. For additional information on our reinsurance agreements, see Note 8 to the Financial Statements. Table of Contents 7
Regulation Overview Our business is subject to comprehensive regulation and supervision. The purpose of these regulations is primarily to protect our customers and the overall financial system. Many of the laws and regulations to which we are subject are regularly re- examined. Existing or future laws and regulations and interpretations thereof may become more restrictive or otherwise adversely affect our operations or profitability, increase compliance costs, or increase potential regulatory exposure. In recent years we have experienced, and expect to continue to experience, extensive changes in the laws and regulations, and regulatory frameworks, applicable to our businesses. We cannot predict how current or future initiatives will further impact existing laws, regulations and regulatory frameworks. State insurance laws regulate many aspects of our business. The Company is domiciled in Arizona and its principal insurance regulatory authority is the Arizona DIFI. Generally, our insurance products must be approved by the insurance regulators in the state in which they are sold. Our insurance products are also substantially affected by federal and state tax laws. The primary regulatory frameworks applicable to the Company are described further below under the following section headings: • Dodd-Frank Wall Street Reform and Consumer Protection Act • ERISA • Fiduciary Rules and other Standards of Care • U.S. State Insurance Holding Company Regulation • U.S. Insurance Operations ◦ State Insurance Regulation ◦ U.S. Federal Securities Regulation Affecting Insurance Operations • Retirement Product Regulation • Derivatives Regulation • Privacy and Cybersecurity Regulation • Anti-Money Laundering and Anti-Bribery Laws • Unclaimed Property Laws • Taxation • International and Global Regulatory Initiatives Existing and future accounting rules may also impact our results of operations or financial condition. For a discussion of accounting pronouncements and their potential impact on our business, see Note 2 to the Financial Statements. Table of Contents 8
Dodd-Frank Wall Street Reform and Consumer Protection Act The Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank") increased the potential for federal regulation of our businesses. The Financial Stability Oversight Council ("FSOC" or the "Council") may designate certain financial companies as a non-bank financial company (a "Designated Financial Company") subject to supervision by the Board of Governors of the Federal Reserve System ("FRB"). In October 2017, the U.S. Department of the Treasury released a report titled "A Financial System That Creates Economic Opportunities - Asset Management and Insurance" which recommended, among other things, that primary federal and state regulators should focus on potential systemic risks arising from products and activities, and on implementing regulations that strengthen the asset management and insurance industries as a whole, rather than focus on an entity-based regulatory regime. The report also affirmed the role of the U.S. state-based system of insurance regulation. In November 2023, FSOC revised its interpretive guidance regarding the approach FSOC intends to take in making Designated Financial Company determinations. The guidance removed certain prerequisites to the exercise of the Council's Designated Financial Company determination authority, including rescinding the prioritization of an activities-based approach. Simultaneously, FSOC adopted a separate analytic framework that explains the Council's substantive approach to identifying, assessing, and responding to certain potential risks to U.S. financial stability. From time to time Congress has also introduced legislation which if enacted, would amend certain provisions of Dodd-Frank, including by requiring the Council to prioritize the use of an activities-based approach to mitigate identified systemic risks. The Council maintains the authority to designate entities, including the Company, for FRB supervision if it determines that either (i) material financial distress at the entity, or (ii) the nature, scope, size, scale, concentration, interconnectedness, or mix of the entity's activities, could pose a threat to domestic financial stability. The Company continues to believe it does not meet the standards for designation. We cannot predict whether Treasury reports, interpretive guidance, new legislation or other initiatives aimed at revising Dodd- Frank and regulation of the financial system will ultimately form the basis for changes to laws or regulations impacting the Company. ERISA The Employee Retirement Income Security Act of 1974 ("ERISA") is a comprehensive federal statute that applies to U.S. employee benefit plans sponsored by private employers and labor unions. Plans subject to ERISA include pension and profit sharing plans and welfare plans, including health, life and disability plans. ERISA provisions include reporting and disclosure rules, standards of conduct that apply to plan fiduciaries and prohibitions on transactions known as "prohibited transactions," such as conflict-of-interest transactions and certain transactions between a benefit plan and a party in interest. ERISA also provides for civil and criminal penalties and enforcement. FLIAC's insurance business provides service to employee benefit plans subject to ERISA. Fiduciary Rules and Other Standards of Care The Company may be impacted by rules regarding the standard of care applicable to sales of our products and the provision of advice to our customers. In recent years, many of these rules have been revised or reexamined, as described below. Any standards issued by the U.S. Department of Labor ("DOL"), the Securities and Exchange Commission ("SEC"), the National Association of Insurance Commissioners ("NAIC") or state regulators may affect our business, results of operations, cash flows and financial condition. Inconsistencies among applicable standards could increase this impact. DOL Fiduciary Rules On April 25, 2024, the DOL adopted final rule amendments to broaden the circumstances under which fiduciary duties are imposed, and to impose additional conditions on existing prohibited transaction exemptions. However, the DOL's fiduciary rules have been stayed pending the outcome of litigation in two cases that have been consolidated by the Fifth Circuit. We cannot predict the final outcome of the challenge to the DOL's fiduciary rules. The DOL's fiduciary rules, if implemented, may negatively impact our business or the insurance industry. U.S. State Standard of Care Regulation Various states have also adopted laws raising the standard of care owed by broker-dealers, investment advisers, or insurance agents to their customers when recommending an annuity product. For example, at least 48 states have adopted revisions to their suitability laws that generally track the NAIC's revisions to its Suitability in Annuity Transactions Model Regulation, Table of Contents 9
which imposes a requirement that any recommendation of an annuity product be in the consumer's best interest. As changes are adopted by our state regulator(s) and made applicable to us or the third-party firms that distribute our products, they could have an adverse impact on our business. In states that have adopted these increased standards with respect to annuity recommendations, this may lead to an increased risk of regulatory enforcement actions or potentially private claims. SEC Standard of Care Regulation The SEC adopted rules, titled "Regulation Best Interest," effective on June 30, 2020 (i) imposing a "best interest" standard of care on broker-dealers making recommendations regarding securities transactions, including with regard to SEC-registered insurance products, to their customers and (ii) requiring broker-dealers and investment advisers to provide a written summary of the relationship between a broker-dealer or investment adviser, as applicable, and its customer. Since its adoption, Regulation Best Interest has been and continues to be a focus of SEC examinations and enforcement activity. U.S. State Insurance Holding Company Regulation We are subject to the Arizona insurance holding company law which requires us to register with the insurance department and to furnish annually financial and other information about the operations of the Company. Generally, all transactions with affiliates that affect the Company must be fair and reasonable and, if material, require prior notice and approval or non- disapproval by the Arizona DIFI. Group-Wide Supervision The Bermuda Monetary Authority ("BMA") is the group supervisor for FGP. Accordingly, it is subject to group capital standards, additional examination as an insurance group, and participation in supervisory college activities as determined by the BMA and other competent authorities supervising the entities in the insurance group. The Arizona DIFI remains the supervisor of FLIAC along with its affiliated U.S. insurance subsidiaries under FGP and will coordinate its activities with the BMA regarding overall supervision of FGP. Additional areas of focus regarding group-wide supervision of insurance holding companies include the following: • Group Capital Calculation. The NAIC has developed and adopted a U.S. group capital calculation that uses a risk- based capital ("RBC") aggregation methodology. The calculation is intended to serve as an additional tool to help state regulators assess potential risks within and across insurance group. While we are not currently subject to these group capital calculation requirements, we could become subject to them in the future and their potential future impact on us is uncertain. • Macroprudential Framework. The NAIC is developing a macroprudential framework intended to: (1) improve state insurance regulators' ability to monitor and respond to the impact of external financial and economic risks on insurers; (2) better monitor and respond to risk emanating from or amplified by insurers that might be transmitted externally; and (3) increase public awareness of NAIC/state monitoring capabilities regarding macroprudential trends. As part of this initiative, the areas identified by the NAIC for potential enhancement include liquidity reporting and stress testing, resolution and recovery, capital stress testing, and counterparty exposure and concentration. • Examination. State insurance departments conduct periodic examinations of the books and records, financial reporting, policy filings and market conduct of insurance companies domiciled in their states, generally once every three to five years under guidelines promulgated by the NAIC. An open financial examination covering FLIAC was closed in 2025 within no significant findings or actions taken. We cannot predict what, if any, additional requirements and compliance costs any new group-wide standards will impose on FGH or FLIAC. Table of Contents 10
U.S. Insurance Operations Generally, our insurance products must be approved by the insurance regulators in the state in which they are sold. Our insurance products are substantially affected by federal and state tax laws. State Insurance Regulation State insurance regulators have broad powers with respect to all aspects of the insurance business including: (1) licensing to transact business; (2) licensing agents; (3) admittance of assets to statutory surplus; (4) regulating premium rates for certain insurance products; (5) approving policy forms; (6) regulating unfair trade and claims practices; (7) establishing reserve requirements and solvency standards; (8) fixing maximum interest rates on life insurance policy loans and minimum accumulation or surrender values; (9) regulating the type, amounts and valuations of investments permitted; (10) regulating reinsurance transactions, including the role of captive reinsurers; (11) data privacy and cybersecurity and (12) other matters. State insurance laws and regulations require the Company to file financial statements with state insurance departments everywhere it does business in accordance with accounting practices and procedures prescribed or permitted by these departments. The Company's operations and accounts are subject to examination by those departments at any time. Financial Regulation Dividend Payment Limitations. The Arizona insurance law regulates the amount of dividends that may be paid by the Company. See Note 12 to the Financial Statements for a discussion of dividend restrictions. Risk-Based Capital. We are subject to RBC requirements that are designed to enhance regulation of insurers' solvency. The RBC calculation, which regulators use to assess the sufficiency of an insurer's statutory capital, measures the risk characteristics of a company's assets, liabilities and certain off-balance sheet items. In general, RBC is calculated by applying factors to various asset, premium, claim, expense and reserve items. Within a given risk category, these factors are higher for those items with greater underlying risk and lower for items with lower underlying risk. Insurers that have less statutory capital than required are considered to have inadequate capital and are subject to varying degrees of regulatory action depending upon the level of capital inadequacy. Areas of the RBC framework that have recently been subject to reexamination or revision include the following: • Bond Factors. In August 2021, the NAIC adopted the Moody's Analytics proposed revisions to the RBC C-1 factors for invested assets effective for the year-end 2021 RBC calculation. The revisions included expanding the NAIC designations used in the RBC calculation from six bond structures to twenty. Since its adoption, the new factors have not materially impacted our RBC calculations. More recently, the NAIC adopted a principles-based bond definition, effective January 1, 2025, to provide a framework for enhanced clarity and consistency of bond reporting. The new standard requires a determination of whether a security represents a creditor relationship based its substance, rather than solely the legal form of the instrument, and may result in certain structured securities formerly classified as bonds being accounted for as a riskier category of investment. The new standards did not have a material impact on our RBC calculation. • Longevity/Mortality Risk. In 2021, the NAIC's Life Risk-Based Capital Working Group adopted longevity risk factors for some annuity products and a correlation adjustment between longevity and mortality risk factors. The Company assumes this longevity risk primarily in its individual annuities business. • Economic Scenario Generator ("Generator"). In 2017, the American Academy of Actuaries notified the NAIC that it did not have the resources to maintain its Generator used in regulatory reserve and capital calculations. In 2020, the NAIC selected a third-party vendor to provide, maintain, and support the Generator prescribed for life and annuity statutory reserve and capital calculations. Further changes to or replacements of the Generator could impact our business. Due to the ongoing nature of the NAIC's activities regarding RBC, we cannot determine the ultimate timing of the proposed changes or their impact on RBC or on our financial position. Table of Contents 11
Insurance Reserves and Regulatory Capital. State insurance laws require us to analyze the adequacy of our reserves annually. Our appointed actuary must submit an opinion that our reserves, when considered in light of the assets we hold with respect to those reserves, make adequate provision for our contractual obligations and related expenses. Market Conduct Regulation State insurance laws and regulations include numerous provisions governing the marketplace activities of insurers, including provisions governing the form and content of disclosure to consumers, illustrations, advertising, sales practices and complaint handling, as well as underwriting and claims activity. State regulatory authorities generally enforce these provisions through periodic market conduct examinations. We have been subject to market conduct examinations relating to our marketplace activities, including with respect to the policies and procedures we use to locate guaranteed group annuity customers and establish related reserves. Market conduct examinations by state regulatory authorities have resulted and may in the future result in us increasing statutory reserves, changing operational processes and procedures, and being subject to fines or other discipline. Climate Issues In 2020, the NAIC established a Climate and Resiliency Task Force under the Executive Committee to coordinate domestic and international discussions and engagement on climate-related risk and resiliency issues. Charges for the Task Force include: considering appropriate climate risk disclosures within the insurance sector; evaluating financial regulatory approaches to climate risk and resiliency, including stress testing, scenario modeling, and solvency implications; considering innovative insurer solutions to climate risk and resiliency; identifying sustainability, resilience and mitigation issues and solutions related to the insurance industry; and considering pre-disaster mitigation and resiliency and the role of state insurance regulators in resiliency. To date, the Task Force has not adopted any regulatory requirements but may do so in the future as it advances its work. The NAIC has generally modified its Insurer Climate Risk Disclosure survey, which is used by several states, to align with aspects of the Financial Stability Board's Task Force on Climate-Related Financial Disclosures (TCFD) framework, a recognized framework of recommendations that were developed to enhance climate-related disclosures. The NAIC is also considering potential enhancements to existing regulatory tools relative to the solvency effects of climate which may be incorporated into the NAIC's Financial Analysis Handbook, the Financial Condition Examiners Handbook and the ORSA Guidance Manual. Insurance Guaranty Association Assessments Each state has insurance guaranty association laws under which insurers doing business in the state are members and may be assessed by state insurance guaranty associations for certain obligations of insolvent insurance companies to policyholders and claimants. Typically, states assess each member insurer in an amount related to the member insurer's proportionate share of the business written by all member insurers in the state. The majority of state guaranty association laws provide a tax offset for a percentage of the assessment against future years' premium taxes. We cannot predict the amount and timing of future assessments on the Company under these laws. Table of Contents 12
U.S. Federal Securities Regulation Affecting Insurance Operations The U.S. federal securities laws are primarily intended to ensure the integrity of the financial markets and protect investors, and they generally grant regulatory agencies broad rulemaking and enforcement powers, including the power to limit or restrict the conduct of business for failure to comply with such laws and regulations. Our variable and registered index-linked annuities products, as well as certain of our fixed interest annuity contracts and fixed interest allocation options subject to a market value adjustment, generally are "securities" within the meaning of federal securities laws and generally are required to be registered under the federal securities laws and are subject to regulation by the SEC and the Financial Industry Regulatory Authority ("FINRA"). The registration of our non-variable annuity products triggers certain reporting requirements under the Securities Exchange Act of 1934. As a result, we are subject to extensive regulation under the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Company Act of 1940 and the SEC's rules and regulations thereunder. In the future, we may choose to rely on the exemption provided by Rule 12h-7 under the Securities Exchange Act of 1934 to cease filing periodic and current reports that are otherwise required under the Securities Exchange Act of 1934. Federal securities regulation also affects investment advice, sales and related activities with respect to these products. The SEC and FINRA may from time to time make inquiries and conduct examinations regarding our compliance with securities and other laws and regulations. We will cooperate with such inquiries and examinations and take corrective action when warranted. On March 6, 2024, the SEC adopted new rules designed to enhance reporting company disclosures related to the risks and impacts of climate-related matters. The new rules require disclosures of climate-related risks and risk management as well as the board and management's governance of such risks. In addition, the rules include requirements to disclose the financial effects of severe weather events and other natural conditions in the financial statements. Larger registrants will also be required to disclose information about greenhouse gas emissions, which will be subject to a phased-in assurance requirement. Petitions seeking review of the new rules were filed in multiple courts of appeal, and on April 4, 2024, the SEC voluntarily stayed the implementation of the final rules pending the outcome of the Eighth Circuit's judicial review of the consolidated petitions. We cannot predict the result of the judicial review. Federal Insurance Office Dodd-Frank established a Federal Insurance Office ("FIO") within the Department of the Treasury headed by a director appointed by the Secretary of the Treasury. While the FIO does not have general supervisory or regulatory authority over the business of insurance, the FIO director performs various functions with respect to insurance, including serving as a non-voting member of the Council, monitoring the insurance sector and representing the U.S. on prudential aspects of international insurance matters, including at the International Association of Insurance Supervisors ("IAIS"). Recent Tax Law Changes Related to Retirement Plans and Products In December 2019, Congress enacted the Setting Every Community up for Retirement Enhancement ("SECURE") Act. The SECURE Act is intended to help promote retirement plan coverage and increase retirement plan savings, as well as facilitate access to guaranteed lifetime income solutions. The SECURE Act addresses coverage issues by making it easier for small businesses to participate in pooled employer plans and requires coverage of certain long-term, part-time workers. The SECURE Act addresses savings issues by raising the cap on amounts contributed through auto-enrollment, increasing the maximum age for required minimum distributions to 72 and removing the age cap (70) for making IRA contributions. The SECURE Act also made it easier for employers to include guaranteed lifetime income as part of their plan by providing an annuity provider selection safe harbor, as well as providing for the portability of participant investments in annuity products. In addition, the SECURE Act included provisions that enable participants to withdraw, penalty-free, up to $5,000 for expenses attendant to the birth or adoption of a child and limit the ability of certain IRA beneficiaries to defer tax recognition of their inheritance beyond ten years. In December 2022, SECURE Act 2.0 ("SECURE 2.0") was enacted. SECURE 2.0 contains numerous significant changes for retirement plans, plan sponsors, and retirement plan providers. For example, SECURE 2.0 contains provisions related to, among many other things, increasing the required minimum distribution age, reducing required minimum distribution penalties, and removing required minimum distribution barriers for annuities. Many of the provisions in SECURE 2.0 went effective in 2023, but SECURE 2.0 will not be completely implemented until 2027. The Internal Revenue Service ("IRS") has issued additional guidance addressing specific issues arising from the implementation of the provisions of SECURE 2.0. Table of Contents 13
Derivatives Regulation FLIAC uses derivatives for various purposes, including hedging interest rate, foreign currency and equity market exposures. Dodd-Frank established a framework for regulation of the over-the-counter derivatives markets. This framework sets out requirements regarding the clearing and reporting of derivatives transactions, as well as collateral posting requirements for uncleared swaps. We continue to monitor the potential hedging cost impacts of new initial margin requirements, and increased capital requirements for derivatives transactions. Additionally, the increased need to post cash collateral in connection with mandatorily cleared swaps may also require the liquidation of higher yielding assets for cash, resulting in a negative impact on investment income. Privacy and Cybersecurity Regulation We are subject to laws, regulations and directives that require financial institutions and other businesses to protect the security and confidentiality of personal information, including health-related and customer information, and to notify their customers and other individuals of their policies and practices relating to the collection and disclosure of personal information. In addition, we must comply with applicable privacy laws, regulations, and directives concerning the transfer or use of personal information. These laws, regulations, and directives also, among other things: • require protections regarding the use and disclosure of certain information such as national identifier numbers (e.g., social security numbers); • require periodic disclosure of privacy policies and practices to customers and consumers; • require notice to affected individuals, regulators and others if there is a breach of the security of certain personal or confidential information; • require financial institutions and creditors to implement effective programs to detect, prevent, and mitigate identity theft; • require the proper disposal of customer and consumer information; • regulate the process by which financial institutions make telemarketing calls and send e-mail, text, or fax messages to consumers and customers; • require oversight of third parties that have access to, and handle, personal or confidential information; • provide individuals with rights over their personal information, such as the right to obtain portable copies of or request the deletion of their personal information; and • prescribe the permissible uses of certain personal information, including customer information and consumer report information. General regulatory and legislative activity in the areas of privacy, data protection and information and cybersecurity continues to increase worldwide. Financial regulators continue to focus on data privacy and cybersecurity, have communicated heightened expectations with respect to security and regulatory compliance, and have increased emphasis in this area in their examinations of regulated entities. For example, the E.U.'s General Data Protection Regulation ("GDPR") confers substantial privacy rights on individuals in the E.U. and establishes significant penalties for violations, and several international countries have adopted GDPR-like regulations. In the U.S., many states have adopted comprehensive privacy and data protection laws. Insurance regulatory activity related to privacy, data protection and cybersecurity also continues to increase. In October 2017, the NAIC adopted the Insurance Data Security Model Law. The model law requires that insurance companies establish a cybersecurity program and includes specific technical safeguards as well as requirements regarding governance, incident planning, data management, system testing, vendor oversight and regulator notification. At least 26 states have either implemented the model law, or have otherwise adopted similar laws. The NAIC is also drafting a new Privacy Protection Model Act (to replace and modernize the Insurance Information and Privacy Protection Model Act and the Privacy of Consumer Financial and Health Information Model Regulation) that would include stronger provisions related to consumer rights, consent, and notification as well as third-party service agreements, data retention and deletion policies, and data sharing agreements. In 2023, the SEC adopted final rules requiring reporting companies to disclose material cybersecurity incidents and their processes regarding cybersecurity risk management, strategy, and governance. The following are the key requirements applicable to the Company: (i) current disclosure of material cybersecurity incidents on Form 8-K and (ii) Annual disclosure on Form 10-K of information about cybersecurity risk management, strategy, and governance. See "Cybersecurity" contained in Item 1C for further information. Table of Contents 14
The SEC has also proposed new Rule 38a-2, which if adopted would require investment companies registered under the Investment Company Act of 1940, such as the separate accounts that support our variable annuities and variable life insurance policies, to adopt and implement a comprehensive set of written policies and procedures designed to address cybersecurity risks and to disclose in variable annuity and variable life insurance prospectuses information about any significant cybersecurity incident that has occurred in the past two fiscal years. In addition, significant amendments to Regulation S-P, the SEC's privacy of consumer information and safeguarding customer information rules applicable to registered investment companies, went effective as of August 2, 2024. The amendments broadened the scope of information that must be protected and imposed extensive new obligations related to incident response and prevention, the notification of affected individuals, and the oversight of third party vendors. The Company actively monitors regulatory developments in these areas, and may be subject to increased compliance costs and regulatory requirements as they become effective. As our compliance obligations continue to grow with the introduction and enforcement of new laws, there may be an increased risk to the Company of regulatory enforcement actions or potentially private claims. Anti-Money Laundering and Anti-Bribery Laws Our business is subject to various anti-money laundering and financial transparency laws and regulations that seek to promote cooperation among financial institutions, regulators and law enforcement entities in identifying parties that may be involved in terrorism or money laundering. In addition, under current U.S. law and regulations we may be prohibited from dealing with certain individuals or entities in certain circumstances and we may be required to monitor customer activities, which may affect our ability to attract and retain customers. We are also subject to various laws and regulations relating to corrupt and illegal payments to government officials and others, including the U.S. Foreign Corrupt Practices Act. The obligation of financial institutions, including the Company, to identify their clients, to monitor for and report suspicious transactions, to monitor dealings with government officials, to respond to requests for information by regulatory authorities and law enforcement agencies, and to share information with other financial institutions, has required the implementation and maintenance of internal practices, procedures and controls. Unclaimed Property Laws We are subject to the laws and regulations of states and other jurisdictions concerning the identification, reporting and escheatment of unclaimed or abandoned funds, and we are subject to audit and examination for compliance with these requirements. For additional discussion of these matters, see Note 13 to the Financial Statements. Taxation U.S. Taxation The principal differences between the Company's actual income tax expense and the applicable statutory federal income tax rate are generally deductions for non-taxable investment income, including the Dividends Received Deduction ("DRD"), and intercompany cost allocations. The applicable statutory federal income tax rate is 21%. A future increase in the applicable statutory federal income tax rate above 21% would adversely impact the Company's tax position. In addition, as discussed further below, the tax attributes of our products may impact both the Company's and our customers' tax positions. See "Income Taxes" in Note 2 to the Financial Statements and Note 9 to the Financial Statements for a description of the Company's tax position. As discussed further below, new tax legislation and other potential changes to the tax law may impact the Company's tax position and the attractiveness of our products. U.S. federal tax law generally permits tax deferral on the inside build-up of investment value of certain retirement savings, annuities and life insurance products until there is a contract distribution and, in general, excludes from taxation the death benefit paid under a life insurance contract. It is possible that some individuals with overall lower effective tax rates could be less attracted to the tax deferral aspect of the Company's products. A general reduction in individual tax rates and elimination of certain individual deductions may also impact the Company, depending on whether current and potential customers have more or less after-tax income to save for retirement and manage their mortality and longevity risk through the purchase of the Company's products. Congress from time to time may enact other changes to the tax law that could make our products less attractive to consumers, including legislation that would modify the tax favored treatment of retirement savings, life insurance and annuities products. Table of Contents 15
The products we sell have different tax characteristics and, in some cases, generate tax deductions and credits for the Company. Changes in either the U.S. or foreign tax laws may negatively impact the deductions and credits available to the Company, including the ability of the Company to claim foreign tax credits with respect to taxes withheld on our investments supporting separate account products. These changes would increase the Company's actual tax expense and reduce its net income. The profitability of certain products is significantly dependent on these characteristics and our ability to continue to generate taxable income, which is taken into consideration when pricing products and is a component of our capital management strategies. Accordingly, changes in tax law, our ability to generate taxable income, or other factors impacting the availability or value of the tax characteristics generated by our products, could impact product pricing, increase our tax expense or require us to implement other actions that could be disruptive to our businesses. International and Global Regulatory Initiatives In addition to the adoption of Dodd-Frank in the United States, lawmakers around the world are actively exploring steps to avoid future financial crises. In many respects, this work is being led by the Financial Stability Board ("FSB"), which consists of representatives of national financial authorities of the G20 nations. The G20, the FSB and related bodies have developed proposals to address such issues as financial group supervision, capital and solvency standards, systemic economic risk, corporate governance including executive compensation, and a host of related issues. The IAIS developed the Common Framework for the Supervision of Internationally Active Insurance Groups ("ComFrame"). Through ComFrame, the IAIS seeks to promote effective and globally consistent supervision of the insurance industry through uniform standards for insurer corporate governance, enterprise risk management and other control functions, group-wide supervision and group capital adequacy. The non-capital related components of ComFrame were adopted by the IAIS in November 2019. On December 5, 2024, the IAIS adopted the Insurance Capital Standard ("ICS"), which is the capital adequacy component of ComFrame, as well as updates to the existing components of ComFrame related to climate risk, the assessment and mitigation of systemic risk, and valuation and capital adequacy. The IAIS will begin developing a detailed ICS assessment methodology in 2025 for use in monitoring future progress in the implementation of the ICS. As a standard setting body, the IAIS does not have direct authority to require insurance companies to comply with the policy measures it develops, including the ICS. However, we could become subject to these policy measures if they were adopted by either our group supervisor or supervisors of FGH, which could impact the manner in which the Company deploys its capital, structures and manages its businesses, and otherwise operates. Human Capital Resources The Company has no employees. Services to the Company are primarily provided by employees of FGH as described under "Expense Charges and Allocations" in Note 11 to the Financial Statements. Table of Contents 16
Item 1A. Risk Factors You should carefully consider the following risks. These risks are not exclusive, and additional risks to which we are subject include, but are not limited to, the factors mentioned under "Forward-Looking Statements" above and the risks of our business described elsewhere in this Annual Report on Form 10-K. Many of these risks are interrelated and could occur under similar business and economic conditions, and the occurrence of certain of them may in turn cause the emergence or exacerbate the effect of others. Such a combination could materially increase the severity of the impact of these risks on our business, results of operations, financial condition and liquidity. Overview The Company's risk management framework documents the definition, potential manifestation, and management of its risks. The Company has categorized its risks into tactical and strategic risks. Tactical risks may cause damage to the Company, and the Company seeks to manage and mitigate them through models, metrics and the overall risk framework. The Company's tactical risks include investment, insurance, market, liquidity, and operational risk. Strategic risks can cause the Company's fundamental business model to change, either through a shift in the businesses in which it is engaged or a change in execution. The Company's strategic risks include regulatory and technological changes and other external factors. These risks, as well as the sub-risks that may impact the Company, are discussed below. Investment Risk Our investment portfolios are subject to the risk of loss due to default or deterioration in credit quality or value. We are exposed to investment risk through our investments, which primarily consist of public and private fixed maturity securities, mortgage loans, equity securities, and alternative assets, which include private equity, hedge funds, and real estate. We are also exposed to investment risk through a potential counterparty default. Investment risk may result from: (1) economic conditions; (2) adverse capital market conditions, including disruptions in individual market sectors or a lack of buyers in the marketplace; (3) volatility; (4) credit spread changes; (5) benchmark interest rate changes; and (6) declines in value of underlying collateral. These factors may impact the credit quality, liquidity and value of our investments and derivatives, potentially resulting in higher capital charges and potentially non tax-deductible unrealized or realized losses. Also, certain investments we hold, regardless of market conditions, are relatively illiquid and our ability to promptly sell these assets for their full value may be limited. Additionally, our valuation of investments may include methodologies, inputs and assumptions which are subject to change and different interpretation and could result in changes to investment valuations that may materially impact our results of operations or financial condition. For information about the valuation of our investments, see "Application of Critical Accounting Estimates" in Item 7 and Note 4 to the Financial Statements in Item 8 for further information. Our investment portfolio is subject to credit risk, which is the risk that an obligor (or guarantor) is unable or unwilling to meet its contractual payment obligations on its fixed maturity security, loan or other obligations. Credit risk may manifest in an idiosyncratic manner (i.e., specific to an individual borrower or industry) or through market-wide credit cycles. Financial deterioration of the obligor increases the risk of default and may increase the capital charges required under such regimes as risk-based capital regulations, or other constructs that may require us to hold the investment and in turn, potentially limit our overall capital flexibility. Credit defaults (as well as credit impairments, realized losses on credit-related sales, and increases in credit related reserves) may result in losses which adversely impact earnings, income tax obligations, capital and our ability to appropriately match our liabilities and meet future obligations. Our Company is subject to counterparty risk, which is the risk that the counterparty to a transaction could default or deteriorate in creditworthiness before or at the final settlement of a transaction. In the normal course of business, we enter into financial contracts to manage risks (such as derivatives to manage market risk and reinsurance treaties to manage insurance risk), improve the return on investments (such as securities lending and repurchase transactions) and provide sources of liquidity or financing (such as credit agreements, securities lending agreements and repurchase agreements). These transactions expose the Company to counterparty risk. Counterparties include commercial banks, investment banks, broker-dealers and insurance and reinsurance companies. In the event of a counterparty deterioration or default, the magnitude of the losses will depend on then current market conditions and the length of time required to enter into a replacement transaction with a new counterparty. Losses are likely to be higher under stressed conditions. Table of Contents 17
Our investment portfolio is subject to equity risk, which is the risk of loss due to deterioration in market value of public equity or alternative assets. We include public equity and alternative assets (including private equity, hedge funds and real estate) in our portfolio constructions, as these asset classes can provide returns over longer periods of time, aligning with the long-term nature of certain of our liabilities. Public equity and alternative assets have varying degrees of price transparency. Equities traded on stock exchanges (public equities) have significant price transparency, as transactions are often required to be disclosed publicly. Assets for which price transparency is more opaque include private equity (joint ventures/limited partnerships) and direct real estate. As these investments typically do not trade on public markets and indications of realizable market value may not be readily available, valuations can be infrequent and/or more volatile. A sustained decline in public equity and alternative markets may reduce the returns earned by our investment portfolio through lower than expected dividend income, property operating income, and capital gains, thereby adversely impacting earnings, income tax obligations, capital, and product pricing assumptions. These assets may also produce volatility in earnings as a result of uneven distributions on the underlying investments. Our investment portfolio may be impacted by the uncertain and evolving economic environment. In recent years, the financial markets have experienced periods of significant volatility and negative returns, contributing to an uncertain and evolving economic environment. The performance of the markets in recent years has been impacted by several interrelating factors such as, but not limited to, rising inflation, changes in interest rates, bank failures, geopolitical turmoil, and actions by governmental authorities (e.g., federal government shutdowns, changes in federal government spending, imposition of new international trade policies). It is not possible to predict the future performance of the markets with any certainty. The uncertain and evolving economic environment could increase the risk of loss on our investments. Insurance Risk We have significant liabilities for policyholders' benefits which are subject to insurance risk. Insurance risk is the risk that actual experience deviates adversely from our insurance assumptions, including mortality and policyholder behavior assumptions. We provide a variety of insurance products that are designed to help customers protect against a variety of financial uncertainties. Our insurance products protect customers against their potential risk of loss by transferring those risks to the Company, where those risks can be managed more efficiently through pooling and diversification over a larger number of independent exposures. During this transfer process, we assume the risk that actual losses experienced in our insurance products deviates significantly from what we expect. More specifically, insurance risk is concerned with the deviations that impact our future liabilities. Our profitability may decline if mortality experience or policyholder behavior experience differ significantly from our expectations when we priced our products at acquisition. In addition, if we experience higher than expected claims our liquidity position may be adversely impacted, and we may incur losses on investments if we are required to sell assets in order to pay claims. If it is necessary to sell assets at a loss, our results of operations and financial condition could be adversely impacted. For a discussion of the impact of changes in insurance assumptions on our financial condition, see "Management's Discussion and Analysis of Financial Condition and Results of Operations - Accounting Policies and Pronouncements - Application of Critical Accounting Estimates - Insurance Liabilities". Certain of our insurance products are subject to mortality risk, which is the risk that actual deaths experienced deviate adversely from our expectations. Mortality risk is a biometric risk that can manifest in the following ways: • Mortality calamity is the risk that mortality rates in a single year deviate adversely from what is expected as the result of specific events, such as natural or man-made disasters, military actions, or terrorism. A mortality calamity event will reduce our earnings and capital and we may be forced to liquidate assets before maturity in order to pay the excess claims. Mortality calamity risk is more pronounced in respect of specific geographic areas (including major metropolitan centers, where we have concentrations of customers), concentrations of employees or significant operations. Ultimate losses depend on several factors, including the rates of mortality and morbidity among various segments of the insured population, the collectability of reinsurance, the possible macroeconomic effects on our investment portfolio, the effect on lapses and surrenders of existing policies, as well as other variables. Table of Contents 18
• Mortality trend is the risk that mortality improvements in the future deviate adversely from what is expected. Mortality trend is a long-term risk in that it can emerge gradually over time. For example, as a result of the COVID-19 pandemic, it is possible that long-term deviations from mortality assumptions may emerge in the coming years. Longevity products, such as annuities, experience adverse impacts due to higher-than-expected mortality improvement. Mortality products, such as life insurance, experience adverse impacts due to lower-than-expected improvement. If this risk were to emerge, the Company would update assumptions used to calculate reserves for in- force business, which may result in additional assets needed to meet the higher expected annuity claims or earlier expected life claims. An increase in reserves due to revised assumptions has an immediate impact on our results of operations and financial condition; however, economically the impact is generally long-term as the excess outflow is paid over time. • Mortality base is the risk that actual base mortality deviates adversely from what is expected in pricing and valuing our products. Base mortality risk can arise from a lack of credible data on which to base the assumptions. Certain of our insurance products are subject to policyholder behavior risk, which is the risk that actual policyholder behavior deviates adversely from what is expected. Policyholder behavior risk includes the following components: • Lapse calamity is the risk that lapse rates over the short-term deviate adversely from what is expected, for example, surrenders of certain insurance products may increase following a downgrade of our financial strength ratings, adverse publicity or a change in economic conditions. Only certain products are exposed to this risk. Products that offer a cash surrender value that resides in the general account could pose a potential short-term lapse calamity risk. Surrender of these products can impact liquidity, and it may be necessary in certain market conditions to sell assets to meet surrender demands. Lapse calamity can also impact our earnings through its impact on estimated future profits. • Policyholder behavior efficiency is the risk that the behavior of our customers or policyholders deviates adversely from what is expected. Policyholder behavior efficiency risk arises through product features which provide some degree of choice or flexibility for the policyholder, which can impact the amount and/or timing of claims. Such choices include surrender, lapse, partial withdrawal, policy loan, utilization, and premium payment rates for contracts with flexible premiums. While some behavior is driven by macro factors such as market movements, policyholder behavior at a fundamental level is driven primarily by policyholders' individual needs, which may differ significantly from product to product depending on many factors including the features offered, the approach taken to market each product, and competitor pricing. For example, persistency (the probability that a contract will remain in force) within our annuities business may be significantly impacted by the value of guaranteed minimum benefits contained in many of our variable annuity products being higher than current account values in light of poor market performance as well as other factors. Many of our products also provide our customers with wide flexibility with respect to the amount and timing of premium deposits and the amount and timing of withdrawals from the policy's value. Results may vary based on differences between actual and expected premium deposits and withdrawals for these products. The pricing of certain of our variable annuity products that contain certain living benefit guarantees is also based on assumptions about utilization rates, or the percentage of contracts that will utilize the benefit during the contract duration, including the timing of the first withdrawal. Results may vary based on differences between actual and expected benefit utilization. We may also be impacted by customers seeking to sell their benefits. In particular, third-party investor strategies in our annuities business could adversely affect the profitability of existing business. Policyholder behavior efficiency is generally a long-term risk that emerges over time. An increase in reserves due to revised assumptions has an immediate impact on our results of operations and financial condition; however, from an economic or cash flow perspective, the impact is generally long-term as the excess outflow is paid over time. Our ability to reprice products is limited, and may not compensate for deviations from our expected insurance assumptions. Although some of our products permit us to increase premiums or adjust other charges and credits during the life of the policy or contract, the adjustments permitted under the terms of the policies or contracts may not be sufficient to maintain profitability or may cause the policies or contracts to lapse. Many of our products do not permit us to increase premiums or adjust other charges and credits or limit those adjustments during the life of the contract. Even if permitted under the policy or contract, we may not be able or willing to raise premiums or adjust other charges sufficiently, or at all. Accordingly, significant deviations in actual experience from our pricing assumptions could have an adverse effect on the profitability of our products. Table of Contents 19
Market Risk The profitability of many of our insurance and annuity products are subject to market risk. Market risk is the risk of loss from changes in interest rates and equity prices. The profitability of many of our insurance and annuity products depends in part on the value of the separate accounts supporting these products, which can fluctuate substantially depending on market conditions. Derivative instruments we use to hedge and manage interest rate and equity market risks associated with our products and businesses, and other risks might not perform as intended or expected resulting in higher than expected realized losses and stresses on liquidity. Market conditions can limit availability of hedging instruments, require us to post additional collateral, and further increase the cost of executing product related hedges and such costs may not be recovered in the pricing of the underlying products being hedged. Market risk may limit opportunities for investment of available funds at appropriate returns, including due to the interest rate environment, or other factors, with possible negative impacts on our overall results. Limited opportunities for attractive investments may lead to holding cash for long periods of time and increased use of derivatives for duration management and other portfolio management purposes. The increased use of derivatives may increase the volatility of our U.S. GAAP results and our statutory capital. Our investments, results of operations and financial condition may also be adversely affected by developments in the global economy, and in the U.S. economy (including as a result of actions by the Federal Reserve with respect to monetary policy, and adverse political developments). Global or U.S. economic activity and financial markets may in turn be negatively affected by adverse developments or conditions in specific geographical regions. For a discussion of the impact of changes in market conditions on our financial condition see Item 7A "Quantitative and Qualitative Disclosures About Market Risk". Our insurance and annuity products, and our investment returns, are subject to interest rate risk, which is the risk of loss arising from asset/liability duration mismatches within our general account investments. The risk of mismatch in asset/ liability duration is mainly driven by the specific dynamics of product liabilities. Some product liabilities are expected to have only modest risk related to interest rates because cash flows can be matched by available assets in the investable space. The interest rate risk emerges primarily from their tail cash flows (30 years or more), which cannot be matched by assets for sale in the marketplace, exposing the Company to future reinvestment risk. In addition, certain of our products provide for recurring premiums which may be invested at interest rates lower than the rates included in our pricing assumptions. Market-sensitive cash flows exist with other product liabilities including products whose cash flows can be linked to market performance through secondary guarantees, minimum crediting rates, and/or changes in insurance assumptions. Our exposure to interest rates can manifest over years as in the case of earnings compression or in the short term by creating volatility in both earnings and capital. For example, some of our products expose us to the risk that changes in interest rates will impact the spread between the amounts that we are required to pay under contracts and the rate of return we are able to earn on our general account investments supporting these contracts. When interest rates decline or remain low we must invest in lower-yielding instruments, potentially reducing net investment income. This risk is increased as more policyholders may retain their policies in a low rate environment. Since many of our policies and contracts have guaranteed minimum crediting rates or limit the resetting of crediting rates, the spreads could decrease or go negative. Alternatively, when interest rates rise, we may not be able to replace the assets in our general account with the higher-yielding assets as quickly as needed to fund the higher crediting rates necessary to keep these products and contracts competitive. It is possible that fewer policyholders may retain their policies and annuity contracts as they pursue higher crediting rates, which could expose the Company to losses and liquidity stress. Rapid rises in interest rates may cause our interest maintenance reserve ("IMR") to decrease or become negative if fixed income securities are sold at a capital loss. In 2023, the NAIC issued temporary guidance that allows the admittance of 10 percent of negative IMR. Previous guidance disallowed all negative IMR; however, if our IMR balance becomes negative, our statutory surplus would still be affected negatively. This interim guidance is effective until December 31, 2025. The NAIC is developing a long-term solution regarding the accounting treatment of a negative IMR, which may nullify the interim guidance prior to its expiration. At this time, the outcome of this initiative is uncertain. Table of Contents 20
In recent years, the interest rate environment has been significantly volatile. Our mitigation efforts with respect to interest rate risk are primarily focused on maintaining an investment portfolio with diversified maturities that has a key rate duration profile that is approximately equal to the key rate duration profile of our liability and surplus benchmarks; however, these benchmarks are based on estimates of the liability cash flow profiles which are complex and could turn out to be inaccurate, especially when markets are volatile. In addition, there are practical and capital market limitations on our ability to accomplish this matching. Due to these and other factors we may need to liquidate investments prior to maturity at a loss in order to satisfy liabilities or be forced to reinvest funds in a lower rate environment. Guarantees within certain of our products, in particular our variable annuities, are market sensitive and may decrease our earnings or increase the volatility of our results of operations or financial position under U.S. GAAP. Certain of our products, particularly our variable annuity products, include guarantees of minimum surrender values or income streams for stated periods or for life, which may be in excess of account values. Certain of our products, particularly certain index-linked annuity products, include interest crediting guarantees based on the performance of an index. Downturns in equity markets, increased equity volatility, increased credit spreads, or (as discussed above) reduced interest rates could result in an increase in the valuation of liabilities associated with such guarantees, resulting in increases in reserves and reductions in net income. We use a variety of hedging and risk management strategies, including product features, to mitigate these risks in part and we may periodically change our strategies over time. These strategies may, however, not be fully effective. In addition, we may be unable or may choose not to fully hedge these risks. Hedging instruments may not effectively offset the costs of guarantees or may otherwise be insufficient in relation to our obligations. Hedging instruments also may not change in value correspondingly with associated liabilities due to equity market or interest rate conditions, non-performance risk or other reasons. We may choose to hedge these risks on a basis that does not correspond to their anticipated or actual impact upon our results of operations or financial position under U.S. GAAP. Changes from period to period in the valuation of these policy benefits, and in the amount of our obligations effectively hedged, will result in volatility in our results of operations and financial position under U.S. GAAP and our statutory capital levels. Estimates and assumptions we make in connection with hedging activities may fail to reflect or correspond to our actual long-term exposure from our guarantees. Further, the risk of increases in the costs of our guarantees not covered by our hedging and other capital and risk management strategies may become more significant due to changes in policyholder behavior driven by market conditions or other factors. The above factors, individually or collectively, may have a material adverse effect on our results of operations, financial condition or liquidity. Our valuation of the liabilities for the minimum benefits contained in many of our variable annuity products requires us to consider the market perception of our risk of non-performance, and a decrease in our own credit spreads resulting from ratings upgrades or other events or market conditions could cause the recorded value of these liabilities to increase, which in turn could adversely affect our results of operations and financial position. Liquidity Risk As a financial services company, we are exposed to liquidity risk, which is the risk that the Company is unable to meet near- term obligations as they come due. Liquidity risk is a manifestation of events that are driven by other risk types (market, insurance, investment, operational). A liquidity shortfall may arise in the event of insufficient funding sources or an immediate and significant need for cash or collateral. In addition, it is possible that expected liquidity sources may be unavailable or inadequate to satisfy the liquidity demands described below. The Company has four primary sources of liquidity exposure and associated drivers that trigger material liquidity demand. Those sources are: • Derivative collateral market exposure: Abrupt changes to interest rate, equity, and/or currency markets may increase collateral requirements to counterparties and create liquidity risk for the Company. • Asset liability mismatch: There are liquidity risks associated with liabilities coming due prior to the matching asset cash flows. Structural maturities mismatch can occur in activities such as securities lending, where the liabilities are effectively overnight open transactions used to fund longer term assets. • Wholesale funding: We depend upon the financial markets for funding. These sources might not be available during times of stress, or may only be available on unfavorable terms, which can result in a decrease in our profitability, higher capital requirements, and a significant reduction in our financial flexibility. • Insurance cash flows: We face potential liquidity risks from unexpected cash demands due to severe mortality calamity, customer withdrawals or lapse events. If such events were to occur, the Company may face unexpectedly high levels of claim payments to policyholders. Table of Contents 21
For a discussion of the Company's liquidity and sources and uses of liquidity see "Liquidity and Capital Resources" in Item 7. Operational Risk Our operations are exposed to the risk of loss resulting from inadequate or failed processes or systems, human error or misconduct, and as a result of external events. An operational risk failure may result in one or more actual or potential impacts to the Company. While the Company has policies and procedures in place to monitor vendors' operational risks and assess their risk mitigation efforts, there is no guarantee that our vendors will always be able to avoid operational risk failure. Operational Risk Types • Processes - Processing failure; failure to safeguard or retain documents/records; errors in valuation/pricing models and processes; project management or execution failures; improper sales practices; improper administration of our products. • Systems - Failures during the development and implementation of new systems; systems failures. • People - Internal fraud, breaches of employment law, unauthorized activities; loss or lack of key personnel, inadequate training; inadequate supervision. • External Events - External crime; cyber-attack; outsourcing risk; vendor risk; natural and other disasters; changes in laws/regulations. • Legal - Legal and regulatory compliance failures. Potential Impacts • Financial losses - The Company experiences a financial loss. This loss may originate from various causes including, but not limited to, transaction processing errors and fraud. • Client Service impacts - The Company may not be able to service customers. This may result if the Company is unable to continue operations during a business continuation event or if systems are compromised due to malware or virus. • Regulatory fines or sanctions - When the Company fails to comply with applicable laws or regulations, regulatory fines or sanctions may be imposed. In addition, possible restrictions on business activities may result. • Legal actions - Failure to comply with laws and regulations also exposes the Company to litigation risk. This may also result in financial losses. • Reputational harm - Failure to meet regulator, customer, investor and other stakeholder expectations may cause reputational harm. Liabilities we may incur as a result of operational failures are described further under "Contingent Liabilities" in Note 13 to the Financial Statements. In addition, certain pending regulatory and litigation matters affecting us, and certain risks to our businesses presented by such matters, are discussed in Note 13 to the Financial Statements. We may become subject to additional regulatory and legal actions in the future. Key Enterprise Operational Risks - Key enterprise operational risks include, among others, the following: We are subject to business continuation risk, which is the risk that our operations, systems or data may be disrupted. We may experience a business continuation event as a result of, among other things, the following: • Severe pandemic. • Geo-political risks, including armed conflict and civil unrest. • Terrorist events. • Significant natural or accidental disasters. • Cyber-attacks. We depend heavily on our telecommunication, information technology and other operational systems and on the integrity and timeliness of data we use to run our businesses and service our customers. These systems may fail to operate properly or become disabled as a result of events or circumstances wholly or partly beyond our control. Further, we face the risk of operational and technology failures by others, including clearing agents, exchanges and other financial intermediaries and of vendors and parties to which we outsource the provision of services or business operations. Table of Contents 22
While we maintain business continuity policies and procedures, there is no guarantee that they will be effective in mitigating or eliminating the risks described above. We may not adequately maintain information security. Organized cyber-attack activity continues to be a significant threat to the financial services sector, including the Company. Publicly-reported cybersecurity threats and incidents have dramatically increased in recent years, and financial services companies and their third-party service providers are increasingly the targets of cyber-attacks. The techniques used to attack systems and networks change frequently, are becoming more sophisticated, can originate from a wide variety of sources, and are often not recognized until after they have been launched. Protecting both "structured" and "unstructured" sensitive information is a constant need. However, the risks associated with cyber-attacks cannot be fully mitigated using technology or otherwise. Risks associated with cyber-attacks come in numerous forms, such as the following: • Unsuspecting employees represent a primary avenue for external parties to gain access to our network and systems. Many attacks, even from sophisticated actors, include rudimentary techniques such as coaxing an internal user to click on a malicious attachment or link to introduce malware or steal their username and password (i.e., phishing). • The use of remote or flexible work arrangements, remote access tools, and mobile technology have expanded potential targets for cyber-attack. • Wrongdoers often seek to encrypt data (i.e., ransomware) or disrupt communications (i.e., denial of service) for the purposes of extortion. • The rapid evolution of artificial intelligence technologies may increase the risk of cyber-attacks and data breaches if such technologies are deployed by threat actors. • Financial services companies are increasingly being targeted by hackers and fraudulent actors seeking to monetize personal data or extort money. • Nation-state sponsored organizations often engage in cyber-attacks, not only for monetization purposes, but also to gain information about foreign citizens and governments or to influence or cause disruptions in commerce or political affairs. • We have also seen continued non-technical attempts to commit fraud or solicit information via call centers and interactive voice response systems. • We rely on third parties to provide services as described further below. While we have certain standards for all vendors that provide us services, our vendors, and in turn, their own service providers, may become subject to a security breach, including as a result of their failure to perform in accordance with contractual arrangements. • There may be an increased risk of cyber-attacks during periods of geo-political or military conflict. • It is possible that a cybersecurity incident could persist for an extended period of time without detection. We have implemented a cybersecurity program to mitigate these and other cybersecurity risks, which includes a variety of physical, technical and administrative controls. However, we cannot guarantee that our cybersecurity program will be effective in preventing or mitigating all cybersecurity risks. A material cybersecurity incident could still occur, which could have a significant negative impact on our business. Although we maintain cyber-security insurance coverage against costs resulting from cybersecurity incidents, it is possible losses will exceed the amount available under our coverage. See "Cybersecurity" contained with in Item 1C for further information regarding our cybersecurity program. We may not adequately ensure the privacy of personal information. In the course of our ordinary business we collect, store and share with various third-parties (e.g., service providers, reinsurers, etc.) substantial amounts of private and confidential information, including in some instances sensitive information, including health-related information. We are subject to the risk that the privacy of this information may be compromised, including as a result of an information security breach described above. Any compromise or perceived compromise of our security by us or by one of our vendors could damage our reputation, cause the termination of relationships with marketing partners and insurance carriers, reduce demand for our services and subject us to significant liability and expense as well as regulatory action and lawsuits, which would harm our business, operating results and financial condition. Table of Contents 23
Third parties (outsourcing providers, vendors and suppliers) present added operational risk to our enterprise. The Company's business model relies heavily on the use of third parties to deliver contracted services in a broad range of areas. This presents the risk that the Company could not meet legal, regulatory, financial or customer obligations in the event that our third- party vendors fail to deliver contracted services, or that the Company may be exposed to reputational damage due to actions or inactions of our third-party vendors. We monitor the performance of our third-party vendors, but there is no guarantee that our monitoring activities will always prevent or detect failures by our vendors. As a financial services company, we are exposed to model risk, which is the risk of financial loss or reputational damage or adverse regulatory impacts caused by model errors or limitations, incorrect implementation of models, or misuse of or overreliance upon models. Models are utilized by our businesses and corporate areas primarily to project future cash flows associated with pricing products, calculating reserves and valuing assets, as well as in evaluating risk and determining capital requirements, among other uses. These models may not operate properly and may rely on assumptions and projections that are inherently uncertain. As our businesses continue to grow and evolve, the number and complexity of models we utilize expands, increasing our exposure to error in the design, implementation or use of models, including the associated input data and assumptions. Furthermore, our models might change as the result of the new or changing laws or regulations. The development and adoption of artificial intelligence ("AI"), including generative artificial intelligence ("Generative AI"), and its use and anticipated use by us or by third-parties on whom we rely, may increase the operational risks discussed above or create new operational risks that we are not currently anticipating. AI technologies offer potential benefits in areas such as customer service personalization and process automation. We may use AI and Generative AI in our operations. We also expect third-parties on whom we rely to do the same. AI and Generative AI, as relatively new technologies, may expose us to risks related to their misuse (e.g., misinformation, privacy concerns, cybersecurity). Those risks may be heightened by the speed at which such technologies are being adopted in the financial services sector and more broadly, as well as by the lack of established laws, regulations or standards governing their use. Misuse could expose the Company to legal or regulatory risk, damage customer relationships, or cause reputational harm. Our competitors may also adopt AI or Generative AI more quickly or more effectively than we do, which could cause competitive harm. Strategic Risk We are subject to the risk of events that can cause our fundamental business model to change, either through a shift in the businesses in which we are engaged or a change in our execution. In addition, tactical risks may become strategic risks. For example, we have considered and must continue to consider the impact of the evolving interest rate environment on our business. Changes in the regulatory landscape may be unsettling to our business model. New laws and regulations are being considered in the U.S. at an increasing pace, as there has been greater scrutiny on financial regulation over the past several years. In addition, there are significant legal, regulatory and tax uncertainties following the 2024 U.S. presidential election, and we cannot predict the nature, timing and economic effects of any potential policy changes under the new administration. Proposed or unforeseen changes in law or regulation may adversely impact our business. See "Business - Regulation" for a discussion of certain recently enacted and pending proposals by international, federal and state regulatory authorities and their potential impact on our business, including in the following areas: • Financial sector regulatory reform. • U.S. federal, state and local tax laws. • Fiduciary rules and other standards of care. • Our regulation under U.S. state insurance laws and developments regarding group-wide supervision and capital standards, accounting rules, RBC factors for invested assets and reserves for variable annuities and other products. • Privacy and cybersecurity regulation. Changes in accounting rules applicable to our business may also have an adverse impact on our results of operations or financial condition. Table of Contents 24
Changes in technology and other external factors may be unsettling to our business model. We believe the following aspects of technological and other changes would significantly impact our business model. There may be other unforeseen changes in technology and the external environment which may have a significant impact on our business model. • Interaction with Customers. Technology is moving rapidly and as it does, it puts pressure on existing business models. Some of the changes we can anticipate are increased choices about how customers want to interact with the Company or how they want the Company to interact with them. • Investment Portfolio. Technology may have a significant impact on the companies in which the Company invests. For example, environmental concerns spur scientific inquiry which may reposition the relative attractiveness of wind or sun power over oil and gas. The transportation industry may favor alternative modes of conveyance of goods which may shift trucking or air transport out of favor. Consumers may change their purchasing behavior to favor online activity which would change the role of malls and retail properties. • Medical Advances. The Company is exposed to the impact of medical advances in two major ways. Genetic testing and the availability of that information unequally to consumers and insurers can bring anti-selection risks. Specifically, data from genetic testing can give our prospective customers a clearer view into their future, allowing them to select products protecting them against likelihoods of mortality or longevity with more precision. Also, technologies that extend lives will challenge our actuarial assumptions especially in the annuity-based businesses. The following items are examples of other factors which could have a meaningful impact on our business. • The changing competitive landscape may adversely affect the Company. If we elect to begin selling new policies in the future, we may face intense competition from insurance companies and diversified financial institutions, both for the ultimate customers for our products and, in many businesses, for distribution through non-affiliated distribution channels. Technological advances, changing customer expectations, including related to digital offerings, access to customer data or other changes in the marketplace may present opportunities for new or smaller companies without established products or distribution channels to meet consumers' increased expectations more efficiently than us. Fintech and insurtech companies and companies in other industries with greater access to customers and data have the potential to disrupt industries globally, and many participants have been partially funded by industry players. • We are exposed to risks related to climate conditions. Our business could be negatively impacted by increased costs, or financial losses on investments, arising from events related to climate conditions (i.e., long-term weather patterns). For example, climate conditions may produce changes in public policy, systemic risk to financial systems, short-term or long-term market disruptions, changes in mortality/morbidity experience, availability of reinsurance, changes in consumer behavior, business disruptions, more frequent and severe weather events, and increased regulatory requirements. Climate conditions could also impact the types of assets in which we invest. For example, regulators could require us to invest less in carbon-based industries, even if those investments produce better returns. In addition, real estate investments may expose us to greater climate risk, as changing climate conditions may negatively impact market prices or supply and demand, and may make damaging weather events more likely or frequent. We cannot predict with certainty the long-term impacts of changing climate conditions on our business. • We are exposed to risks relating to the evolving landscape of ESG standards. Customers, regulators, and other market participants may evaluate our business or other practices according to a variety of ESG standards, expectations or metrics, all of which may evolve, may be subjective or underdeveloped in nature, and may reflect contrasting or conflicting values. Standard-setting organizations and regulators, including, but not limited to, the NAIC, SEC, and state insurance regulators, have proposed or adopted, or may propose or adopt, ESG rules or standards that would apply to our business. Compliance with new regulations and regulatory developments may significantly increase our compliance costs. In addition, certain organizations that provide information to investors have developed ratings for evaluating companies on their approach to different ESG matters. Due to the sometimes conflicting, uncertain and subjective ESG regulatory and market environment, we may be seen as acting inconsistently with ESG standards or values from the perspective of certain customers, regulators or other constituents. As a result, we may face adverse regulatory, investor, customer, media, or public scrutiny leading to business, reputational, or legal challenges. Table of Contents 25
• Market conditions and other factors may adversely increase expenses. Examples include: • A change in market conditions, such as high inflation and high interest rates, could cause a change in consumer sentiment and behavior adversely affecting persistency of our savings and protection products. Conversely, low inflation and low interest rates could cause persistency of these products to vary from that anticipated and adversely affect profitability. Similarly, changing economic conditions and unfavorable public perception of financial institutions can influence customer behavior, including increasing claims or surrenders in certain products. • Lapses and surrenders of certain insurance products may increase if a market downturn, increased market volatility or other market conditions result in customers becoming dissatisfied with their investments or products. • Our reputation may be adversely impacted if any of the risks described in this section are realized. Reputational risk could manifest from any of the risks as identified in the Company's risk identification process. Failure to effectively manage risks across a broad range of risk issues exposes the Company to reputational harm. If the Company were to suffer a significant loss in reputation, both policyholders and counterparties could seek to exit existing relationships. Additionally, large changes in credit worthiness, especially credit ratings, could impact access to funding markets while creating additional collateral requirements for existing relationships. The mismanagement of any such risks may potentially damage our reputational asset. Our business is anchored in the strength of our brand, our alignment to our values, and our proven commitment to keep our promises to our customers. Any negative public perception, founded or otherwise, can be widely and rapidly shared over social media or other means, and could cause damage to our reputation. Item 1B. Unresolved Staff Comments None. Item 1C. Cybersecurity Cybersecurity Program Overview FLIAC prioritizes the security of its electronic information systems and the data residing therein. In order to respond to the risks posed by a variety of cybersecurity threats, including security breaches, cyber-attacks, and other cybersecurity incidents, FLIAC has implemented a Cybersecurity Program (the "Program") managed by our Chief Information Security Officer ("CISO") and the CISO's Information Security Team. The Program is designed to protect and preserve the confidentiality, integrity, and continued availability of the electronic information systems that we own or use, and all electronic information owned by or in the care of the Company. The Program is based on industry leading frameworks including the National Institute of Standards and Technology ("NIST") Cyber Security Framework ("CSF") and NIST 800-53. The NIST CSF provides standards, guidelines, and best practices on managing cybersecurity risk and for the organization, improvement, and assessment of the Program. The Program governs all FLIAC internal systems, as well as third parties providing service to the Company, and is based on the following five pillars: • Identify - The first pillar of the Program is to identify the organization's critical assets, vulnerabilities, and potential threats. This involves conducting a thorough quantitative and qualitative risk assessment and asset inventory based on the organization's information systems, data repositories, and network infrastructure. Additionally, it involves categorizing and classifying the importance of different assets, assessing their potential impact on the organization if compromised, and identifying applicable regulatory compliance requirements. This pillar of the Program also involves regular engagement with the broader security community and monitoring of new and emerging cyber threat information. • Protect - After identifying the assets and vulnerabilities, FLIAC applies comprehensive asset protection methods allowing for accurate risk mitigation techniques. This includes deploying a range of security controls such as firewalls, intrusion detection systems, antivirus software, encryption mechanisms, and access controls. The goal is to establish multiple layers of defense to prevent unauthorized access, data breaches, cyber-attacks, and other cybersecurity incidents. Employee awareness training (including phishing simulation exercises to train employees to recognize and report phishing attacks) and secure coding practices also fall under this component to ensure a culture of security throughout the Company. Table of Contents 26
• Detect - The Program focuses on the timely detection of any suspicious activities or security breaches. This involves implementing security monitoring systems, intrusion detection systems, and log analysis tools to continuously monitor network traffic, system logs, and user behavior. Real-time alerts and security incident management processes help in identifying potential security incidents promptly. • Respond - If a security incident is detected, a response plan is triggered to minimize the impact and contain the threat. This component involves establishing an incident response team and defining incident response procedures. The team is trained to respond promptly, investigate the incident, mitigate the damage or harm, and restore normal operations. Communication plans, escalation protocols, legal considerations, regulatory requirements, (including appropriate and timely reporting and disclosure of cybersecurity incidents to regulators and affected individuals), and coordination with external entities, like regulators, law enforcement, vendors and other key stakeholders, are also part of the response process. • Recover - The final pillar of the Program focuses on recovering from a security incident and restoring normal operations. This includes activities such as system restoration, data recovery, and analyzing the incident to identify lessons learned and improve future incident response capabilities. It also involves assessing residual risks, updating security controls, and continuously monitoring and testing the Company's security posture to ensure readiness for potential future incidents. Cybersecurity risk management under the Program is an integrated part of the Company's overall management of operational risk, as described further below under "Cybersecurity Risk Management Governance." The Company did not experience any material cybersecurity incidents during the period covered by this report. Nor did the Company identify any risks from cybersecurity threats that have materially affected or are reasonably likely to materially affect the Company, including its business strategy, results of operations, or financial condition. However, the Company recognizes that cybersecurity risks are constantly evolving, and the Company continuously monitors and adapts to these risks to protect its systems and data. It is possible that the Company will experience a material cybersecurity incident in the future. For more information on operational and cybersecurity risks, see "Item 1A. Risk Factors - Operational Risk" earlier in this report. Vendor Risk Management The Program seeks to ensure that each vendor (or third-party service provider) with whom the Company does business meets the Company's standards for protecting and preserving the confidentiality, integrity, and continued availability of electronic information systems and data. The Company requires vendors to meet threshold requirements for cybersecurity controls, such as access controls, logging and monitoring, and encryption. The Company's contracts with vendors require the implementation and maintenance of such controls, and obligate vendors to promptly report all cybersecurity incidents to the Company. Based on the overall risk level associated with a particular vendor, the Company's contract with a service provider may require enhanced or heightened controls. The CISO's Information Security Team performs risk-based initial and periodic due diligence of vendors, during which the Information Security Team evaluates, assesses, and otherwise reviews vendor cybersecurity controls. The results of such reviews are reported to the CISO. Any cybersecurity incidents involving vendors will be escalated and acted upon in accordance with the Program. Cybersecurity Risk Management Governance The CISO is responsible for managing the Program. The CISO reports to the Company's Chief Information Officer and regularly engages with the Chief Risk Officer on matters related to the Program. Cybersecurity risks are evaluated by Company management alongside and consistent with other operational risks, with the CISO and the Information Security Team providing subject matter expertise on the identification, assessment, and tracking of cybersecurity risks under the Program. In addition, the Company regularly engages external consultants in connection with evaluating and enhancing the Program and the Company's overall management of cybersecurity threats. For example, the Company engages external consultants to assist the Company in identifying evolving technologies and threats, developing action plans, performing penetration tests, conducting exercises, and conducting periodic reviews. The Board of Directors (the "Board") is responsible for oversight of the Company's management of operational risks, including cybersecurity threats. The Board receives a comprehensive report at least annually from the Chief Information Officer and the CISO. The comprehensive annual report covers matters related to the Program, such as enhancements, incident reporting, performance metrics, status reports, oversight of third-party service providers, and the results of Program reviews, including exercises and response readiness assessments led by external consultants. The report also includes information about significant and emerging cybersecurity threats that may affect the Company. In addition to a comprehensive annual cybersecurity report, Table of Contents 27
the Board receives periodic interim reports from the Chief Information Officer and the CISO. To the extent cybersecurity controls are related to internal controls over financial reporting, such controls are also considered in the context of Management's annual assessment of the effectiveness of internal controls over financial reporting. The CISO, supported by the Information Security Team, is responsible for implementing and managing the Program. The CISO has served in various roles in information technology and information security for over 25 years and has broad and extensive experience in multiple industries including financial services, healthcare, and higher education. The CISO holds a graduate degree in IT management and has attained the professional certifications of Certified Information Systems Security Professional (CISSP), Certified Information Security Manager (CISM), Boardroom Certified Qualified Technology Expert (QTE), and is a Distinguished Fellow with the Information Systems Security Association (ISSA). Item 2. Properties The Company occupies office space through lease agreements primarily in Jersey City, New Jersey and Brentwood, Tennessee. Item 3. Legal Proceedings See Note 13 to the Financial Statements under "Litigation and Regulatory Matters" for a description of certain pending litigation and regulatory matters affecting us, and certain risks to our businesses presented by such matters. Item 4. Mine Safety Disclosures Not Applicable. Table of Contents 28
PART II Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The Company is a wholly-owned subsidiary of Fortitude Group Holdings, LLC ("FGH"). There is no public market for the Company's common stock. Item 6. [Reserved] Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations You should read the following analysis of our financial condition and results of operations in conjunction with the "Forward- Looking Statements" included below the Table of Contents, "Risk Factors", and the Financial Statements included in this Annual Report on Form 10-K. Overview The Company was established in 1969 and has been a provider of annuity contracts for the individual market in the United States. The Company's products have been sold primarily to individuals to provide for long-term savings and retirement needs and to address the economic impact of premature death, estate planning concerns and supplemental retirement income. The Company has sold a wide array of annuities, including deferred and immediate variable and index-linked annuities. Some of our annuity products include (1) fixed interest rate allocation options, subject to a market value adjustment, that are registered with the United States Securities and Exchange Commission (the "SEC"), or (2) fixed-rate allocation options subject to a limited market value adjustment or no market value adjustment and not registered with the SEC. The Company has ceased all new sales of its insurance products but has entered into reinsurance agreements to assume certain annuity business. For more information on products, see "Item 1 Business - Products". Funding Agreements and Funding Agreement Backed Notes (FABN) In October 2025, FLIAC issued $500 million of funding agreements to Fortitude Global Funding (FGF), an unaffiliated statutory trust. The issuance of these funding agreements was made within a FABN program whereby FGF uses the net proceeds from the notes issued under the program to purchase funding agreements from the Company. The funding agreements have matching interest and maturity payment terms with the applicable notes issued under the FABN program. New Reinsurance Transactions In October 2025, FLIAC entered into a reinsurance agreement to cede, on a modified coinsurance basis, 85% of its funding agreement liabilities associated with the FABN program to a Bermuda-domiciled affiliate of the Company. The agreement is effective October 6, 2025 and includes funding agreements issued on or subsequent to the effective date. In October 2025, FLIAC entered into a reinsurance agreement with an unaffiliated subsidiary of a U.S. based life insurance company to assume, on a coinsurance basis, a portion of new fixed annuity liabilities, of which 100% of the assumed business was immediately retroceded, on a modified coinsurance basis, to a Bermuda-domiciled affiliate of the Company. The agreement is effective October 6, 2025 and includes new policies on or subsequent to the effective date. Fair Value of Insurance Liabilities - Actuarial Assumption Updates In the third quarters of 2025, 2024, and 2023 the Company completed its annual review of actuarial assumptions related to the fair value of insurance liabilities. Based on those reviews, the Company updated certain assumptions associated with its variable annuity contracts with guaranteed benefits in each period, which resulted in an increase (decrease) in its fair value of insurance liabilities of $11 million, $(3) million, and $116 million for the years ended 2025, 2024, and 2023, respectively. The 2023 increase was driven by updates to assumptions regarding policyholder behavior, primarily to reflect lower observed surrender rates. The impact of the respective assumption updates on the Consolidated Statement of Operations was included within "Policyholder benefits and changes in fair value of insurance liabilities". Table of Contents 29
The significant inputs to the valuation models include capital market assumptions, such as interest rate levels and volatility assumptions, as well as actuarially-determined assumptions, including contractholder behavior, such as lapse rates, benefit utilization rates, withdrawal rates, and mortality rates. Further information regarding these assumptions are below. See Note 7 contained in the "Notes to Financial Statements" contained in Item 8 for further discussion regarding significant assumptions related to our fair value of insurance liabilities. See also Note 4 for further quantitative information regarding these assumptions. Goodwill Impairment As a result of our 2023 actuarial assumption update, the Company identified a triggering event regarding its goodwill impairment analysis for the Retained Business. Following a qualitative analysis that indicated the fair value of the reporting unit may be lower than its carrying value, the Company performed a quantitative analysis that involved both discounted cash flow techniques and market price comparisons to establish fair values on its underlying assets and liabilities. After performing this quantitative analysis, the Company determined that the goodwill was fully impaired, and accordingly, recorded a non-cash goodwill impairment of $93 million through the Consolidated Statement of Operations. Following this impairment, there was no remaining goodwill. Novation of Ceded Business In 2022, in accordance with applicable state law, a program was instituted to novate a significant portion of the Ceded Business policies from FLIAC to Pruco Life. The program did not have an impact on total equity or net income but has resulted in the reduction of certain activity/balances associated with these policies. During the year ended December 31, 2023, approximately $641 million of account value, which generally approximates fair values of insurance liabilities, was transferred out of the Company as a result of the novation program. There was no significant novation activity during 2025 and 2024 and we do not expect significant future novation activity under the program. Since the acquisition of the Company in April 2022, approximately 73 percent of account value has been novated to Pruco Life under this program. Revenues and Expenses The Company earns revenues principally from contract fees, mortality and expense fees, and asset administration fees from annuity and investment products, all of which primarily result from the sale and servicing of annuity products. The Company also earns net investment income from the investment of general account and other funds. The Company's operating expenses principally consist of annuity benefit guarantees provided, reserves established for anticipated future annuity benefit guarantees, and costs of managing risk related to these products. The Company's operating expenses also include interest credited to policyholders' account balances, general business expenses, reinsurance premiums, and commissions and other costs of servicing the various products it sold. Impact of a Changing Interest Rate Environment As a financial services company, market interest rates are a key driver of the Company's results of operations and financial condition. Changes in interest rates can affect our results of operations and/or our financial condition in several ways, including favorable or adverse impacts to: • investment-related activity, including: investment income returns, net interest margins, net investment spread results, new money rates, mortgage loan prepayments and bond redemptions; • the recoverability of deferred tax assets related to losses on our fixed maturity securities portfolio; • hedging costs and other risk mitigation activities; • insurance reserve levels and market experience true-ups; • customer account values, including their impact on fee income; and • policyholder behavior, including surrender or withdrawal activity. For more information on interest rate risks, see "Risk Factors - Market Risk". Table of Contents 30
Accounting Policies & Pronouncements Application of Critical Accounting Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America ("U.S. GAAP") requires the application of accounting policies that often involve a significant degree of judgment. Management, on an ongoing basis, reviews estimates and assumptions used in the preparation of financial statements. If management determines that modifications in assumptions and estimates are appropriate given current facts and circumstances, the Company's results of operations and financial position as reported in the Financial Statements could change significantly. The following sections discuss the accounting policies applied in preparing the Company's financial statements that management believes are/were most dependent on the application of estimates and assumptions and require management's most difficult, subjective or complex judgments. INSURANCE LIABILITIES We have elected the fair value option on certain of our insurance and reinsurance contracts, which include liabilities for guarantee benefits related to certain long-duration life and annuity contracts. The fair values of insurance liabilities associated with variable annuity contracts with guaranteed benefits are calculated as the present value of future expected benefit payments to customers, anticipated future trail commissions paid to agents and certain administrative expenses less the present value of future expected rider fees, mortality and expense charges, contract charges and the anticipated future reimbursement of certain asset management fees. Since there is no observable active market for the transfer of these obligations, the valuations are calculated using internally developed models with option pricing techniques. The models are based on a risk neutral valuation framework and incorporate premiums for risks inherent in valuation techniques, inputs, and the general uncertainty around the timing and amount of future cash flows. The determination of these risk premiums requires the use of management's judgment. The significant inputs to the valuation models include capital market assumptions, such as interest rate levels and volatility assumptions, as well as actuarially-determined assumptions, including contractholder behavior, such as lapse rates, benefit utilization rates, withdrawal rates, and mortality rates. Further information regarding these assumptions are below. The following table summarizes the impact that could result on our insurance liabilities, related to our variable annuity products, which are recorded at fair value, from changes in certain key assumptions. The information below is for illustrative purposes and includes only the immediate hypothetical direct impact on December 31, 2025 balances of changes in a single assumption and not changes in any combination of assumptions. Additionally, the illustration of the insurance assumption impacts below reflects a parallel shift in the insurance assumptions; however, these may be non-parallel in practice. Changes in current assumptions could result in impacts to financial statement balances that are in excess of the amounts illustrated. December 31, 2025 (in millions) Hypothetical change in insurance liabilities due to changes in actuarially-determined assumptions Mortality Increase by 1% $ (19) Decrease by 1% $ 19 Lapse Increase by 10% $ (26) Decrease by 10% $ 26 Hypothetical change in insurance liabilities due to changes in capital market conditions NPR credit spread Increase by 50 basis points $ (93) Decrease by 50 basis points $ 120 Equity Volatility Increase by 1% $ 7 Decrease by 1% $ (7) Table of Contents 31
The impacts presented within the above table exclude the related impacts of our asset/liability management strategy, which seeks to offset the changes in the balances presented within this table and is primarily composed of investments and derivatives. For information regarding the impacts related to changes in both interest rate and equity market movements, see Item 7A "Quantitative and Qualitative Disclosures About Market Risk". The assumptions used in establishing our insurance liabilities are generally based on the Company's experience, industry experience, market observable data, and/or other factors, as applicable. We evaluate our actuarial assumptions at least annually and update them, as appropriate, unless a material change that we feel is indicative of a long-term trend is observed in an interim period. Generally, we do not expect trends to change significantly in the short-term, and to the extent these trends may change, we expect such changes to be gradual over the long term. See Note 7 Insurance Liabilities within "Item 8 Financial Statements and Supplementary Data" for further discussion regarding the significant assumptions noted above as well as certain other significant assumptions not included in the above analysis. VALUATION OF INVESTMENTS Our investment portfolio consists of public and private fixed maturity securities, mortgage loans, other invested assets, and derivative financial instruments. Derivatives are financial instruments whose values are derived from interest rates, foreign exchange rates, financial indices, or the values of securities. Derivative financial instruments we generally use include swaps, futures, forwards, and options and may be exchange-traded or contracted in the over-the-counter ("OTC") market. We present at fair value in the statements of financial position our fixed maturity securities, certain investments within "Other invested assets," such as derivatives and the majority of our private equity partnership investments. For additional information regarding the key estimates and assumptions surrounding the determination of fair value of fixed maturity securities, as well as derivative instruments, and other investments, see Note 4 to the Financial Statements. The degree of judgment utilized in measuring the fair value of financial instruments generally correlates to the level of pricing observability. Financial instruments with readily available active quoted prices or for which fair value can be measured from actively quoted prices in active markets generally have more pricing observability and less judgment utilized in measuring fair value. The market sources from which we obtain or derive the fair values of our assets and liabilities carried at market value include quoted market prices for actual trades, price quotes from third party pricing vendors, price quotes we obtain from outside brokers, discounted cash flow, and observable prices for similar publicly traded or privately traded issues that incorporate the credit quality and industry sector of the issuer. Our fair value measurements could differ significantly based on the valuation technique and available inputs. Inputs to valuation techniques refer broadly to the assumptions that market participants use in pricing assets or liabilities, including assumptions about risk, for example, the risk inherent in a particular valuation technique used to measure fair value and/or the risk inherent in the inputs to the valuation technique. We use observable and unobservable inputs in measuring the fair value of our financial instruments. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from independent sources. Unobservable inputs are developed based on the best information available in the circumstances, and reflect our evaluation of the assumptions market participants would use in pricing the asset or liability. When observable price quotations are not available, indicative broker quotes, asset manager pricing, or third-party valuation specialist pricing is used for valuation. Fair value can be determined based on discounted cash flow models using discount rates based on credit spreads, yields or price levels of comparable securities, adjusted for illiquidity and structure. The significant unobservable inputs used in the fair value measurement of these investments are liquidity discount rates applied to each of the net tangible book value multiples used in the internal valuation models, and discount rates applied to the expected cash flows of the underlying entities in various scenarios. These unobservable inputs in isolation can cause significant increases or decreases in fair value. Generally, an increase in the liquidity discount rate or discount rates would result in a decrease in the fair value of these private investments. Table of Contents 32
INCOME TAX Our effective tax rate is based on income, non-taxable and non-deductible items, tax credits, statutory tax rates and tax planning opportunities available in the various jurisdictions in which we operate. Inherent in determining our annual tax rate are judgments regarding business plans, planning opportunities, and expectations about future outcomes. The primary drivers for the difference between the Company's effective tax rate and the federal statutory rate during 2025 were changes in the valuation allowance on deferred tax assets and non-taxable investment income associated with the Dividends Received Deduction ("DRD") and intercompany cost allocations. Valuation Allowance on Deferred Tax Assets The evaluation of the recoverability of our deferred tax asset and the need for a valuation allowance requires us to weigh all positive and negative evidence to reach a conclusion that it is more likely than not that all or some portion of the deferred tax asset will not be realized. The weight given to the evidence is commensurate with the extent to which it can be objectively verified. The more negative evidence that exists, the more positive evidence is necessary and the more difficult it is to support a conclusion that a valuation allowance is not needed. In evaluating the need for a valuation allowance, the Company considers many factors, including: (1) the nature of the deferred tax assets and liabilities; (2) whether they are ordinary or capital; (3) the timing of their reversal; (4) taxable income in prior carryback years; (5) projected taxable earnings exclusive of reversing temporary differences and carryforwards; (6) the length of time that carryovers can be utilized; (7) any unique tax rules that would impact the utilization of the deferred tax assets; and (8) any tax planning strategies that the Company would employ to avoid a tax benefit from expiring unused. Although realization is not assured, management believes it is more likely than not that the deferred tax assets, net of valuation allowances, will be realized. As of December 31, 2025 and 2024, the Company held a valuation allowance of $52 million and $50 million, respectively, regarding realized and unrealized capital losses on our fixed maturity securities portfolio. A portion of the deferred tax asset relates to unrealized capital losses for which the carryforward period has not yet begun, and as such, when assessing its recoverability, we consider our ability and intent to hold the underlying securities to recovery. The amount of the deferred tax asset considered realizable may be adjusted if projections of future taxable income, including the character of that taxable income during the requisite carryforward period, are updated or if objective negative evidence exists that outweighs the positive evidence. The increase in the valuation allowance is primarily due to increased capital losses on our fixed maturity securities portfolio. Adoption of New Accounting Pronouncements Changes to U.S. GAAP are established by the Financial Accounting Standards Board ("FASB") in the form of Accounting Standard Updates ("ASU") to the FASB Accounting Standards Codification ("ASC"). We consider the applicability and impact of all ASUs. ASUs listed below include those that have been adopted during the current fiscal year and/or those that have been issued but not yet adopted as of December 31, 2025 and as of the date of this filing. ASUs not listed below were assessed and determined to be either not applicable or not material to the Company. Table of Contents 33
ASUs adopted as of December 31, 2025 Standard Description Effective date and method of adoption Effect on the financial statements or other significant matters ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures This ASU improves income tax disclosure requirements by requiring 1. the use of consistent categories and greater disaggregation of information in the rate reconciliation and 2. income taxes paid disaggregated by jurisdiction. The Company adopted this update for annual reporting periods on January 1, 2025 using the retrospective method. The update expanded the Company's disclosures but did not have an impact on its financial position or results of operations. ASU issued but not yet adopted as of December 31, 2025 Standard Description Effective date and method of adoption Effect on the financial statements or other significant matters ASU 2024-03, Income Statement - Reporting Comprehensive Income (Topic 220): Expense Disaggregation Disclosures This ASU requires additional disclosures regarding certain expense types included in the income statement. The requirements include disclosure of the amounts associated with 1. purchases of inventory, 2. employee compensation, 3. depreciation and 4. intangible asset amortization. These disclosures should be included in each relevant expense caption. Furthermore, entities must disclose specific expenses, gains, or losses already required under US GAAP, offer a qualitative description of amounts not separately quantified, and present the total amount of selling expenses along with a definition of these expenses in their annual reports. Effective for annual reporting periods beginning January 1, 2027, and interim reporting periods beginning January 1, 2028, using either the prospective or retrospective method. Early adoption is permitted The Company is currently evaluating the impact of this disclosure-only requirement. Table of Contents 34
CHANGES IN FINANCIAL POSITION December 31, 2025 to December 31, 2024 Comparison Retained Business Assets decreased $704 million from $25,593 million at December 31, 2024 to $24,889 million at December 31, 2025. The decrease was primarily driven by lower separate account assets resulting from surrenders and withdrawals, partially offset by an increase in fair values due primarily to higher equity market movements. Also contributing to the overall decline in assets was a decrease in cash and cash equivalents which primarily resulted from investment purchases and a $50 million dividend payment to FGH. Liabilities decreased $672 million from $24,444 million at December 31, 2024 to $23,772 million at December 31, 2025. The decrease was primarily driven by lower separate account liabilities which correspond with the decline in separate account assets discussed above. Also contributing to the decrease was a reduction in the fair value of insurance liabilities driven by higher equity market levels and widening credit spreads in 2025, partially offset by the impact of lower interest rates during 2025. Equity decreased $32 million from $1,149 million at December 31, 2024 to $1,117 million at December 31, 2025, due to the $50 million dividend payment to FGH and the impact of a $76 million increase in our own-credit risk (OCR) on the fair value of insurance liabilities, reflected in accumulated other comprehensive loss. Partially offsetting the declines in equity was net income of $94 million. See "Capital" within the "Liquidity and Capital Resources" herein Item 7 for further information regarding the distribution to FGH. Ceded Business Assets and liabilities both increased $1,085 million from $4,346 million at December 31, 2024 to $5,431 million at December 31, 2025. The increase in assets was due to higher cash and invested assets driven by the issuance of funding agreements and the assumption of deferred annuity business during the fourth quarter of 2025 and an increase in reinsurance recoverables resulting from the cession of the respective liabilities to a Bermuda-domiciled affiliate of the Company. The increase in liabilities was primarily driven by higher policyholder contracts deposits associated with the above-mentioned transactions and the establishment of a funds withheld payable related to the cession of the assets under the respective reinsurance agreements. See "Overview" herein Item 7 for further information regarding the these transactions. There was no equity within our Ceded Business at both December 31, 2025 and 2024 as the assets and liabilities related to the Prudential Insurance and Pruco Life reinsurance agreements are fully ceded and the transactions executed in the fourth quarter of 2025 did not have a material impact on equity. RESULTS OF OPERATIONS INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES Comparison of Year Ended December 31, 2025 to Year Ended December 31, 2024 Retained Business Income from operations before income taxes was $106 million for the year ended December 31, 2025, compared to $104 million for the year ended December 31, 2024 with lower investment losses primarily related to interest rate derivatives, mostly offset by unfavorable movements in the fair value of insurance liabilities resulting from lower interest rates and the unfavorable impact of the actuarial assumption in the third quarter of 2025. Ceded Business There was no income from operations before income taxes for the years ended December 31, 2025 and 2024 as the revenues and expenses related to the Prudential Insurance and Pruco Life reinsurance agreements are fully ceded and the transactions executed in the fourth quarter of 2025 did not have a material impact on income from operations before income taxes. Table of Contents 35
Comparison of Year Ended December 31, 2024 to Year Ended December 31, 2023 Retained Business Income from operations before income taxes was $104 million for the year ended December 31, 2024, compared to a loss from operations before income taxes of $10 million for the year ended December 31, 2023. The change was driven primarily by favorable changes in the fair value of insurance liabilities due to higher interest rate and equity market movements, partially offset by higher investment losses. Also contributing to the change between years were the 2023 impacts of the $116 million actuarial assumption update and the $93 million goodwill impairment. Ceded Business There was no impact to income from operations before income taxes as all revenues and expenses are ceded to Prudential Insurance or Pruco Life. REVENUES, BENEFITS, AND EXPENSES Comparison of Year Ended December 31, 2025 to Year Ended December 31, 2024 Retained Business Revenues were $346 million for the year ended December 31, 2025 compared to $(90) million during the year ended December 31, 2024. The change was primarily driven by lower investment losses on interest rate derivatives resulting from declining interest rates. Also contributing to the lower investment losses were gains on equity derivatives driven by less favorable equity market increases during 2025. Benefits and expenses were $240 million for the year ended December 31, 2025 compared to $(194) million during the year ended December 31, 2024. The change was driven primarily by unfavorable movements in the fair value of insurance liabilities resulting from declining interest rates and less favorable equity market increases. Ceded Business Revenues and expenses both declined by $32 million from $282 million for the year ended December 31, 2024 to $250 million for the year ended December 31, 2025 with lower investment gains related to equity derivatives driving the decline in revenues and favorable movements in the fair value of insurance liabilities driving the decline in expenses. The transactions executed in the fourth quarter of 2025 did not have a material impact on revenues and expenses. Comparison of Year Ended December 31, 2024 to Year Ended December 31, 2023 Retained Business Revenues were $(90) million for the year ended December 31, 2024 compared to $190 million during the year ended December 31, 2023. The change was primarily driven by higher investment losses related to fixed maturity securities. Benefits and expenses were $(194) million for the year ended December 31, 2024 compared to $200 million during the year ended December 31, 2023. The change was primarily driven by favorable changes in the fair value of insurance liabilities, excluding changes in OCR, due to higher interest rate and equity market movements. Also contributing to the change between years were the 2023 impacts of the $116 million actuarial assumption update and the $93 million goodwill impairment. Ceded Business Revenues were $282 million for the year ended December 31, 2024 compared to $390 million during the year ended December 31, 2023. The change was primarily driven by lower gains related to interest rate derivatives resulting from higher interest rates. Benefits and expenses were $282 million for the year ended December 31, 2024 compared to $390 million during the year ended December 31, 2023. The change was primarily driven by favorable changes in the fair value of insurance liabilities, excluding changes in OCR, due to higher interest rate movements. Table of Contents 36
Income Taxes For discussion on income tax related items, see "Business - Regulation" and Note 9 to the Financial Statements. Table of Contents 37
Liquidity and Capital Resources Overview Liquidity is a measure of a company's ability to generate cash flows sufficient to meet the short-term and long-term cash requirements of the Company. Capital refers to the long-term financial resources available to support the operations of our business, fund business growth, and provide a cushion to withstand adverse circumstances. Our ability to generate and maintain sufficient liquidity and capital depends on the profitability of our business, general economic conditions, our ability to borrow and our access to capital markets. Effective and prudent liquidity and capital management is a priority across the organization. Management monitors the liquidity of the Company on a daily basis and projects borrowing and capital needs over a multi-year time horizon. We use a Risk Appetite Framework ("RAF") to ensure that all risks taken by the Company aligns with our capacity and willingness to take those risks. The RAF provides a dynamic assessment of capital and liquidity stress impacts and is intended to ensure that sufficient resources are available to absorb those impacts. We believe that our capital and liquidity resources are sufficient to satisfy the capital and liquidity requirements of the Company. Our businesses are subject to comprehensive regulation and supervision by domestic and international regulators. These regulations currently include requirements (many of which are the subject of ongoing rule-making) relating to capital, leverage, liquidity, stress-testing, overall risk management, credit exposure reporting and credit concentration. For information on these regulatory initiatives and their potential impact on us, see Item 1 "Business - Regulation" and Item 1A "Risk Factors". Capital We manage FLIAC to regulatory capital levels and utilize the risk-based capital ("RBC") ratio as a primary measure of capital adequacy. RBC is calculated based on statutory financial statements and risk formulas consistent with the practices of the National Association of Insurance Commissioners ("NAIC"). RBC considers, among other things, risks related to the type and quality of the invested assets, insurance-related risks associated with an insurer's products and liabilities, equity market and interest rate risks and general business risks. RBC determines the minimum amount of capital required of an insurer to support its operations and underwriting coverage. The ratio of a company's Total Adjusted Capital ("TAC") to RBC is the corresponding RBC ratio. RBC ratio calculations are intended to assist insurance regulators in measuring an insurer's solvency and ability to pay future claims. The reporting of RBC measures is not intended for the purpose of ranking any insurance company or for use in connection with any marketing, advertising or promotional activities, but is available to the public. The Company's capital levels substantially exceed the minimum level required by applicable insurance regulations. Our regulatory capital levels may be affected in the future by changes to the applicable regulations, proposals for which are currently under consideration by both domestic and international insurance regulators. The regulatory capital level of the Company can be materially impacted by interest rate and equity market fluctuations, changes in the values of derivatives, the level of impairments recorded, and credit quality migration of the investment portfolio, among other items. In addition, the reinsurance of business or the recapture of business subject to reinsurance arrangements due to defaults by, or credit quality migration affecting, the reinsurers or for other reasons could negatively impact regulatory capital levels. The Company's regulatory capital level is also affected by statutory accounting rules, which are subject to change by each applicable insurance regulator. Dividends and Distributions to Parent During the year ended December 31, 2025, an extraordinary dividend of $50 million to FGH was approved by both the Company's board of directors and the Arizona DIFI and was paid in cash during the fourth quarter of 2025. During the first quarter of 2024, a $150 million dividend was approved by the Company's board of directors, $75 million of which was considered an ordinary dividend and not subject to approval by the Arizona Department of Insurance and Financial Institutions ("DIFI") prior to payment. The other $75 million was conditioned upon the Company receiving written approval from the Arizona DIFI prior to payment. In the second quarter of 2024, the Company received written approval from the Arizona DIFI and the entire $150 million dividend was distributed in cash to FGH. During the third quarter of 2024, a $150 million dividend was approved by the Company's board of directors, which was conditioned upon the Company receiving written approval from the Arizona DIFI prior to payment. In the fourth quarter of 2024, the Company received written approval from the Arizona DIFI and the entire $150 million dividend was distributed in cash to FGH in the fourth quarter of 2024. Table of Contents 38
Distribution to Parent During 2023, the Company made a $45 million distribution to its parent company, FGH, as a result of updated information regarding certain tax assets related to the acquisition of FLIAC, which resulted in an offsetting reduction to "Additional paid-in capital". Capital Contributions FGH, the direct parent of the Company, may make additional capital contributions to FLIAC, as needed, to enable the Company to comply with its reserve requirements and fund expenses in connection with its business. FGH is under no obligation to make such contributions and its assets do not back the benefits payable under the Company's annuity contracts and life insurance policies. The Company did not receive capital contributions from FGH during the years ended December 31, 2025, 2024, and 2023. Liquidity Our liquidity is managed to ensure stable, reliable and cost-effective sources of cash flows to meet all of our obligations. Liquidity is provided by a variety of sources, as described more fully below, including portfolios of liquid assets. Our investment portfolios are integral to the overall liquidity of the Company. We use a projection process for cash flows from operations to ensure sufficient liquidity to meet projected cash outflows, including claims. Liquidity is measured against internally-developed benchmarks that take into account the characteristics of both the asset portfolio and the liabilities that they support. We consider attributes of the various categories of liquid assets (for example, type of asset and credit quality) in calculating internal liquidity measures to evaluate our liquidity under various stress scenarios, including company-specific and market-wide events. We continue to believe that cash generated by ongoing operations and the liquidity profile of our assets provide sufficient liquidity under reasonably foreseeable stress scenarios. The principal sources of the Company's liquidity are premiums and certain annuity considerations, investment and fee income, investment maturities, sales of investments, borrowings from its parent and affiliates, issuances of funding agreements associated with FABN programs, and banking relationships through secured or unsecured agreements. The principal uses of that liquidity include benefits, claims, and payments to policyholders and contractholders in connection with surrenders, withdrawals and net policy loan activity. Other uses of liquidity include commissions, general and administrative expenses, purchases of investments, and the payment of dividends, hedging and reinsurance activity and payments in connection with financing activities. In managing liquidity, we consider the risk of policyholder and contractholder withdrawals of funds earlier than our assumptions when selecting assets to support these contractual obligations. We also consider the risk of future collateral requirements under stressed market conditions in respect of the derivatives we utilize. Liquid Assets Liquid assets include cash and cash equivalents, short-term investments, fixed maturity securities, and public equity securities. As of December 31, 2025 and 2024, the Company had liquid assets of approximately $5.9 billion and $5.6 billion, respectively, which includes $1.9 billion and $1.5 billion, of assets associated with modified coinsurance and funds withheld agreements in each respective year. The portion of liquid assets comprised cash and cash equivalents and short-term investments was approximately $0.4 billion and $0.6 billion as of December 31, 2025 and 2024, respectively. Intercompany Liquidity Agreement FLIAC entered into an intercompany liquidity agreement with FGH that allows the Company to borrow or loan funds of up to $300 million to meet the short-term liquidity and other capital needs of itself and FGH and its affiliates. The Company did not borrow any funds under the agreement during the year ended December 31, 2025. During the second quarter of 2025, the Company loaned $50 million of funds to FGH under the agreement, which was repaid in full, plus interest, in December 2025. Table of Contents 39
During the years ended December 31, 2024 and 2023, the Company borrowed a cumulative total of $80 million and $434 million, respectively, from FGH under the agreement, all of which was repaid in full during the respective years, plus interest. In November 2023, the Company loaned $150 million of funds to FGH under the agreement, which was repaid in full, plus interest, in December 2023. Letter of Credit Facility During 2025, the Company was added as a participant to two uncommitted bilateral letter of credit agreements to support its collateral requirements, which allows it to issue up to $300 million under these facilities. Both letter of credit agreements were initially established for certain of the Company's affiliates. Both agreements contain certain restrictive and maintenance covenants customary for facilities of this type. The ability to utilize the facilities is also subject to the ability and willingness of the banks to issue the letter of credit. The Company is currently in compliance with all covenants associated with these facilities. The Company has not utilized either credit facility since being added as a participant. Also during 2025, the Company became eligible to issue a standby letter of credit with another bank, allowing issuance of up to $100 million until its expiration in December 2027. The facility contains certain restrictive and maintenance covenants customary for facilities of this type. In addition, borrowings are not contingent on the Company's credit ratings nor subject to material adverse change clauses, however, the Company will be required to maintain a minimum Company Action Level ("CAL") Risk-based Capital ratio of 250% to maintain the agreement. In December 2025, a $1 million letter of credit was issued under the agreement, which remained outstanding as of December 31, 2025. The maximum board-approved overall capacity of the letter of credit program is $1,500 million for all participants. The maximum board-approved amount for letters of credit that can be issued under this program for FLIAC is $500 million. Repurchase Agreements and Securities Lending In the normal course of business, we may enter into repurchase agreements and securities lending agreements with unaffiliated financial institutions, which are typically large or highly rated, to earn spread income and facilitate trading activity. Under these agreements, the Company transfers securities to the counterparty and receives cash as collateral. The cash received is generally invested in short-term investments or fixed maturity securities. For repurchase agreements, a liability representing the amount that the securities will be repurchased is recorded in "Other liabilities" in our consolidated statement of financial position. For securities lending agreements, a liability representing the return of cash collateral is recorded in "Other liabilities" in our consolidated statements of financial position. As of December 31, 2025, the liabilities associated with our outstanding repurchase agreements and securities lending transactions were $1,180 million and $3 million, respectively. Funding Agreements and FABN programs We issue funding agreements opportunistically to institutional investors under a FABN program. They are designed to provide an agreement holder with a guaranteed return of principal and periodic fixed-interest payments, while offering competitive yields and predictable returns. The funding agreements have matching interest and maturity payment terms with the applicable notes issued under the program. As of December 31, 2025, funding agreement liabilities, net of reinsurance, totaled $72 million. In conjunction with the FABN program, FLIAC and FGP entered into a Keepwell Agreement, pursuant to which FGP has agreed to take such actions as may be necessary and appropriate to cause FLIAC to maintain, during the term of the Keepwell Agreement, an amount of "total adjusted capital" greater than 300% of the amount of its "company action level risk-based capital,". Holders of the notes issued under the FABN program and Funding Agreements are not third-party beneficiaries of the Keepwell Agreement and will have no right to enforce its terms against FGP. Liquidity Regarding Hedging activities We enter into a range of exchange-traded, cleared, and other OTC derivatives in order to hedge market sensitive exposures against changes in certain capital market risks. The portion of the risk management strategy comprising the hedging portion requires access to liquidity to meet the Company's payment obligations relating to these derivatives, such as payments for periodic settlements, purchases, maturities and terminations. These liquidity needs can vary materially due to, among other items, changes in interest rates, equity markets, mortality, and policyholder behavior. Table of Contents 40
The hedging portion of the risk management strategy may also result in derivative-related collateral postings to (when we are in a net pay position) or from (when we are in a net receive position) counterparties. The net collateral position depends on changes in interest rates and equity markets related to the amount of the exposures hedged. Depending on market conditions, the collateral posting requirements can result in material liquidity needs when we are in a net pay position. Table of Contents 41
Item 7A. Quantitative and Qualitative Disclosures About Market Risk Market Risk Market risk is defined as the risk of loss from changes in interest rates, equity prices, and foreign currency exchange rates resulting from asset/liability mismatches where the change in the value of our liabilities is not offset by the change in value of our assets. See Item 1A, "Risk Factors" for a discussion of how difficult conditions in the financial markets and the economy generally may materially adversely affect our business and results of our operations. Market Risk Management Management of market risk, which we consider to be a combination of both investment risk and market risk exposures, includes the identification and measurement of various forms of risk, the establishment of risk thresholds and the creation of processes intended to maintain risks within these thresholds while optimizing returns on the underlying assets or liabilities. Our risk management process utilizes a variety of tools and techniques, including: • Measurement of price sensitivity to market changes (e.g., interest rates, equity index prices, foreign exchange); • Hedge Target definition; • Asset/liability management, which includes our hedging programs; and • Stress scenario testing related to our risk appetite framework Measurement of Price Sensitivity to Market Changes We measure the price sensitivity to market changes on a daily basis. Sensitivities of both assets and liabilities are gauged and these measurements form the basis for actions we take under our asset/liability and hedging programs. We measure both a target level of price sensitivity, as well as tolerance levels above and below the target, for each market change. Hedge Target The definition of the Hedge Target is critical for market risk management, as it specifies the measure of a liability and its attendant price sensitivities. We use a fair value-based measure of the liability as our hedge target. Consistent with our approach to risk manage the full economics of the business, we have established a hedge target that reflects the net present value of the full set of product cash flows. For most of the products in the business, this generally includes: • Living benefit rider claims we expect to pay in the future; • Living benefit rider fees we receive over time; • Mortality and expense fees we receive on the base variable annuity contracts; • Net revenue sharing income we contractually receive; • Certain product-related expenses; and • Guaranteed death benefits/fees Asset/Liability Management We manage assets to liability-based measures. For example, we identify target durations for assets based on Hedge Target characteristics and asset portfolios are managed to within ranges around them. This mitigates potential unanticipated economic losses from interest rate and equity price movements. We utilize a combination of fixed income securities and derivatives to implement asset/liability management. To the extent that we identify a mismatch between asset and liability sensitivities, we enter into derivatives transactions to cover the difference. Derivatives are used to supplement risk mitigation provided by the fixed income securities portfolio. Our derivatives primarily include swaps, futures and options contracts that are exchange-traded or contracted in the OTC market. Table of Contents 42
Stress Scenario Testing Related to Our Risk Appetite Framework We have established a risk appetite framework that limits the amount of market risks we can take after consideration of our asset/liability management initiatives. We run stress scenario tests periodically to assess the impact of extreme market movements on our balance sheet. This ensures that we have sufficient capital under stressed market conditions. Market Risk Related to Interest Rates We perform liability-driven investing and engage in careful asset/liability management. Asset/liability mismatches create the risk that changes in liability values will differ from the changes in the value of the related assets. Additionally, changes in interest rates may impact other items including, but not limited to, the following: • Net investment spread between the amounts that we are required to pay and the rate of return we are able to earn on investments for certain products supported by general account investments; • Asset-based fees earned on assets under management or contractholder account values; • Estimated total gross profits; • Net exposure to the guarantees provided under certain products; and • Our capital levels. In order to mitigate the impact that an unfavorable interest rate environment has on our net interest margins, we employ a proactive asset/liability management program, which includes strategic asset allocation and derivative strategies within a disciplined risk management framework. We seek to hedge the interest rate sensitivity of our liabilities with our fixed income assets and derivatives. Our asset/liability management program also helps manage duration gaps and other risks between assets and liabilities through the use of derivatives. We adjust this dynamic process as customer behavior changes and as changes in the market environment occur. We use duration and convexity analyses to measure price sensitivity to interest rate changes. Duration measures the relative sensitivity of the fair value of a financial instrument to changes in interest rates. Convexity measures the rate of change in duration with respect to changes in interest rates. We use asset/liability management and derivative strategies to manage our interest rate exposure by matching the relative sensitivity of asset and liability values to interest rate changes, or controlling "duration mismatch" of assets and liability duration targets. In certain markets, capital market limitations that hinder our ability to acquire assets that approximate the duration of some of our liabilities are considered in setting duration targets. We consider risk-based capital as well as current market conditions in our asset/liability management strategies. The Company also mitigates interest rate risk through a market value adjusted ("MVA") provision on certain of the Company's annuity products' fixed investment options. This MVA provision limits interest rate risk by subjecting the contractholder to a MVA when funds are withdrawn or transferred to variable investment options before the end of the guarantee period. In the event of rising interest rates, which generally make the fixed maturity securities underlying the guarantee less valuable, the MVA could be negative. In the event of declining interest rates, which generally make the fixed maturity securities underlying the guarantee more valuable, the MVA could be positive. The resulting increase or decrease in the value of the fixed option, from the calculation of the MVA, is designed to offset the decrease or increase in the market value of the securities underlying the guarantee. We assess the impact of interest rate movements on the value of our Retained Business financial assets, financial liabilities and derivatives using hypothetical scenarios that assume either upward or downward 100 basis point parallel shifts in the yield curve from prevailing interest rates. Table of Contents 43
The following tables set forth the net estimated changes in fair value on these financial instruments from an immediate hypothetical 100 basis point upward and downward parallel shift. While the scenario is for illustrative purposes only and does not reflect our expectations regarding future interest rates or the performance of fixed income markets, it is a near-term, hypothetical change that illustrates the potential impact of such events. These scenarios do not measure the changes in value that could result from non-parallel shifts in the yield curve, which we would expect to produce different changes in discount rates for different maturities. As a result, the actual change in fair value from a 100 basis point change in interest rates could be different from that indicated by these calculations. December 31, 2025 Hypothetical Change in Fair Value Notional Fair Value 100 bps Decrease 100 bps Increase (in millions) Assets Retained Business Fixed maturity securities and mortgage loans $ 4,192 $ 345 $ (273) Liabilities Retained Business Derivatives $ 99,793 $ 484 $ (273) $ 218 Insurance Liabilities Variable annuity products $ 1,849 $ 609 $ (492) $ 336 $ (274) Net change $ 9 $ 1 December 31, 2024 Hypothetical Change in Fair Value Notional Fair Value 100 bps Decrease 100 bps Increase (in millions) Assets Retained Business Fixed maturity securities and mortgage loans $ 3,985 $ 396 $ (328) Liabilities Retained Business Derivatives $ 42,066 $ 413 $ (304) $ 238 Insurance Liabilities Variable annuity products $ 1,913 $ 690 $ (541) $ 386 $ (303) Net change $ 10 $ (25) Table of Contents 44
Market Risk Related to Equity Prices We have exposure to equity risk primarily through asset/liability mismatches, including our equity-based derivatives, and variable annuity contracts. We manage equity risk against benchmarks in respective markets. We benchmark our return on equity holdings against a blend of market indices, mainly the S&P 500 and Russell 2000 for U.S. equities. We benchmark foreign equities against the MSCI EAFE, a market index of European, Australian and Far Eastern equities. We target price sensitivities that approximate those of the benchmark indices. For equity investments within the separate accounts, the investment risk is borne by the separate account contractholder rather than by the Company. We estimate our equity risk from an immediate hypothetical 10 percent change in equity benchmark levels. The following table sets forth the net estimated potential change in fair value from such a change in certain of our Retained Business financial assets, financial liabilities, and derivatives. While these scenarios are for illustrative purposes only and do not reflect our expectations regarding future performance of equity markets or of our equity portfolio, they do represent near-term, hypothetical changes that illustrate the potential impact of such events. In addition, these scenarios do not reflect the impact of basis risk, such as potential differences in the performance of the investment funds underlying the variable annuity products relative to the market indices we use as a basis for developing our hedging strategy. The impact of basis risk could result in larger differences between the change in fair value of the equity-based derivatives and the liability in comparison to these scenarios. In calculating these amounts, we exclude separate account equity securities. December 31, 2025 Hypothetical Change in Fair Value Notional Fair Value 10 percent decrease 10 percent increase (in millions) Liabilities Retained Business Equity Derivatives $ 4,703 $ 12 $ (330) $ 584 Insurance Liabilities - Variable annuity products $ 1,849 $ 337 $ (573) Net change $ 7 $ 11 December 31, 2024 Hypothetical Change in Fair Value Notional Fair Value 10 percent decrease 10 percent increase (in millions) Liabilities Retained Business Equity Derivatives $ 4,671 $ 45 $ (324) $ 299 Insurance Liabilities - Variable annuity products $ 1,913 $ 346 $ (312) Net change $ 22 $ (13) Table of Contents 45
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Fortitude Life Insurance & Annuity Company FINANCIAL STATEMENTS INDEX Page Management's Annual Report on Internal Control Over Financial Reporting 47 Report of Independent Registered Public Accounting Firm (PCAOB ID 238) 48 Statements of Financial Position as of December 31, 2025 and 2024 50 Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, 2025, 2024 and 2023 51 Statements of Equity for the years ended December 31, 2025, 2024 and 2023 52 Statements of Cash Flows for the years ended December 31, 2025, 2024 and 2023 53 Notes to Financial Statements: 1 Business and Basis of Presentation 55 2 Significant Accounting Policies and Pronouncements 56 3 Segment Information 64 4 Fair Value of Assets and Liabilities 67 5 Investments 84 6 Derivatives, Hedging, and Offsetting 87 7 Insurance Liabilities 92 8 Reinsurance 95 9 Income Taxes 98 10 Equity 101 11 Related Party Transactions 102 12 Statutory Net Income and Surplus and Dividend Restrictions 103 13 Commitments, Contingent Liabilities and Litigation and Regulatory Matters 104 14 Separate Accounts 105 15 Credit and Liquidity Agreements 113 Table of Contents 46
Management's Annual Report on Internal Control Over Financial Reporting Management of Fortitude Life Insurance & Annuity Company (the "Company") is responsible for establishing and maintaining adequate internal control over financial reporting. Management conducted an assessment of the effectiveness, as of December 31, 2025, of the Company's internal control over financial reporting, based on the framework established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our assessment under that framework, management concluded that the Company's internal control over financial reporting was effective as of December 31, 2025. Our internal control over financial reporting is a process designed by or under the supervision of our principal executive and principal financial officers to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of management and the directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company's assets that could have a material effect on our financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. This Annual Report does not include an attestation report of the Company's registered public accounting firm, PricewaterhouseCoopers LLP, regarding the internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit the Company to provide only management's report in this Annual Report. March 19, 2026 Table of Contents 47
Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholder of Fortitude Life Insurance & Annuity Company Opinion on the Financial Statements We have audited the accompanying consolidated statements of financial position of Fortitude Life Insurance & Annuity Company and its subsidiaries (the "Company") as of December 31, 2025 and 2024, and the related consolidated statements of operations and comprehensive income (loss), of equity and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes and financial statement schedule listed in the index appearing under Item 15(a)(2) (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Valuation of Retained Business Variable Annuity Contracts with Guaranteed Benefits, Included in Insurance Liabilities, at Fair Value As described in Notes 2, 4, and 7 to the consolidated financial statements, as of December 31, 2025, the fair value of retained business variable annuity contracts with guaranteed benefits, included in insurance liabilities, at fair value was $1.8 billion. Management elected the fair value option on certain of the insurance contracts. The change in fair value of the liabilities associated with these contracts is reported in several line items within revenues and benefits and expenses in the consolidated statement of operations and comprehensive income (loss). Since there is no observable active market for the transfer of these obligations, the valuations are calculated using internally developed models with option pricing techniques. The models are based on a risk neutral valuation framework and incorporate premiums for risks inherent in valuation techniques, inputs, and the general uncertainty around the timing and amount of future cash flows. The determination of these risk premiums requires the use of management's judgment. The significant inputs to the valuation models include capital market assumptions, such as interest rate levels and volatility assumptions, as well as actuarially determined assumptions, including contractholder behavior, such as lapse rates, benefit utilization rates, withdrawal rates, and mortality rates. Table of Contents 48
The principal considerations for our determination that performing procedures relating to the valuation of retained business variable annuity contracts with guaranteed benefits, included in insurance liabilities, at fair value is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the retained business variable annuity contracts with guaranteed benefits; (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management's internal models and aforementioned contractholder behavior assumptions; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included, among others, (i) testing management's process for developing the fair value estimate of retained business variable annuity contracts with guaranteed benefits, included in insurance liabilities, at fair value; (ii) evaluating the appropriateness of management's internal models; (iii) testing the completeness and accuracy of data used in the internal models; and (iv) evaluating the reasonableness of the aforementioned contractholder behavior assumptions. Evaluating the aforementioned contractholder behavior assumptions involved evaluating whether the assumptions used were reasonable considering industry knowledge and data, and historical Company data and experience. Professionals with specialized skill and knowledge were used to assist in evaluating the appropriateness of management's internal models and evaluating the reasonableness of the aforementioned contractholder behavior assumptions. /s/ PricewaterhouseCoopers LLP Nashville, Tennessee March 19, 2026 We have served as the Company's auditor since 2003. Table of Contents 49
Fortitude Life Insurance & Annuity Company Consolidated Statements of Financial Position (in millions, except share data) December 31 2025 2024 ASSETS Fixed maturity securities: Fair value option $ 5,187 $ 5,022 Available for sale, at fair value (amortized cost: December 31, 2025 - $247) 247 - Mortgage loans, at fair value 533 364 Short-term investments 7 8 Other invested assets (includes $511 and $354 of assets measured at fair value at December 31, 2025 and 2024, respectively) 551 395 Total investments 6,525 5,789 Cash and cash equivalents 442 563 Accrued investment income 63 58 Reinsurance recoverables (includes $144 and $163 of recoverables measured at fair value as of December 31, 2025 and 2024, respectively) (includes $463 and $- of recoverables from affiliates as of December 31, 2025 and 2024, respectively) 607 163 Deposit asset, at fair value 287 364 Income taxes 91 76 Other assets (Receivables from parent and affiliates: December 31, 2025 - $1; December 31, 2024 - $10) 32 69 Separate account assets, at fair value 22,273 22,857 TOTAL ASSETS $ 30,320 $ 29,939 LIABILITIES AND EQUITY LIABILITIES Insurance liabilities, at fair value $ 4,349 $ 4,380 Policyholder contract deposits 535 - Funds withheld payable to affiliates 495 - Net modified coinsurance payable, at fair value 150 145 Liabilities associated with secured borrowing arrangements 1,183 1,200 Other liabilities (Payables to parent and affiliates: December 31, 2025 - $7; December 31, 2024 - $4) 218 208 Separate account liabilities, at fair value 22,273 22,857 TOTAL LIABILITIES $ 29,203 $ 28,790 COMMITMENTS AND CONTINGENT LIABILITIES (See Note 13) EQUITY Common stock, $100 par value; 25,000 shares authorized, issued and outstanding $ 3 $ 3 Additional paid-in capital 1,714 1,714 Retained deficit (474) (518) Accumulated other comprehensive loss (126) (50) TOTAL EQUITY 1,117 1,149 TOTAL LIABILITIES AND EQUITY $ 30,320 $ 29,939 Table of Contents See Notes to Consolidated Financial Statements 50
Fortitude Life Insurance & Annuity Company Consolidated Statements of Operations and Comprehensive Income (Loss) (in millions) Year Ended December 31 2025 2024 2023 REVENUES Premiums $ 31 $ 35 $ 27 Policy charges and fee income 421 452 456 Net investment income 277 292 315 Asset management and service fees 87 93 91 Other income (loss) (6) 8 1 Investment losses, net (214) (688) (310) TOTAL REVENUES 596 192 580 BENEFITS AND EXPENSES Policyholder benefits and changes in fair value of insurance liabilities 340 (83) 340 Interest credited to policyholders' account balances 1 - - Commission expense 83 91 90 Goodwill impairment - - 93 General, administrative and other expenses 66 80 67 TOTAL BENEFITS AND EXPENSES 490 88 590 INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES 106 104 (10) Less: Income tax expense (benefit) 12 32 (6) NET INCOME (LOSS) $ 94 $ 72 $ (4) Other comprehensive income (loss), before tax: Changes in own-credit risk related to insurance liabilities $ (96) $ 19 $ (223) Less: Income tax expense (benefit) related to other comprehensive income (loss) (20) 4 (47) Other comprehensive income (loss), net of taxes (76) 15 (176) COMPREHENSIVE INCOME (LOSS) $ 18 $ 87 $ (180) See Notes to Consolidated Financial Statements 51
Fortitude Life Insurance & Annuity Company Consolidated Statements of Equity (in millions) Common Stock Additional Paid-in Capital Retained Deficit Accumulated Other Comprehensive Income (Loss) Total Equity Balance, December 31, 2022 $ 3 $ 1,759 $ (286) $ 111 $ 1,587 Distribution to parent - (45) - - (45) Comprehensive loss: Net loss - - (4) - (4) Other comprehensive loss, net of tax - - - (176) (176) Total comprehensive loss (180) Balance, December 31, 2023 $ 3 $ 1,714 $ (290) $ (65) $ 1,362 Dividend to parent - - (300) - (300) Comprehensive income: Net income - - 72 - 72 Other comprehensive income, net of tax - - - 15 15 Total comprehensive income 87 Balance, December 31, 2024 $ 3 $ 1,714 $ (518) $ (50) $ 1,149 Dividend to parent - - (50) - (50) Comprehensive income (loss): Net income - - 94 - 94 Other comprehensive loss, net of tax - - - (76) (76) Total comprehensive income 18 Balance, December 31, 2025 $ 3 $ 1,714 $ (474) $ (126) $ 1,117 See Notes to Consolidated Financial Statements 52
Fortitude Life Insurance & Annuity Company Consolidated Statements of Cash Flows (in millions) Year Ended December 31, 2025 2024 2023 CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $ 94 $ 72 $ (4) Adjustments to reconcile net income (loss) to net cash from (used in) operating activities: Investment losses, net 214 688 310 Goodwill impairment - - 93 Other, net (17) (8) (30) Change in: Insurance liabilities, at fair value 87 (392) (568) Deposit asset, at fair value 77 74 169 Net modified coinsurance payable 5 67 587 Accrued investment income (6) 2 (11) Income taxes 9 19 (9) Policyholder contract deposits 5 - - Reinsurance recoverables, net 12 43 29 Funds withheld payable to affiliates 39 - - Derivatives, net (488) (762) (584) Other, net 35 (15) 3 Cash flows from (used in) operating activities 66 (212) (15) CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from the sale/maturity/prepayment of: Fixed maturity securities, fair value option 1,047 774 500 Fixed maturity securities, available-for-sale 4 - - Mortgage loans 87 121 116 Other invested assets 3 7 387 Short-term investments 8 39 94 Short-term loan to parent with maturities greater than three months 50 - - Payments for the purchase/origination of: Fixed maturity securities, fair value option (1,056) (808) (783) Fixed maturity securities, available-for-sale (251) - - Mortgage loans (255) (27) (369) Other invested assets (5) (4) (52) Short-term investments (7) (30) (88) Other, net (2) 1 3 Short-term loan to parent with maturities greater than three months (50) - - Cash flows from (used in) investing activities (427) 73 (192) See Notes to Consolidated Financial Statements 53
Fortitude Life Insurance & Annuity Company Consolidated Statements of Cash Flows (Continued) (in millions) Year Ended December 31 2025 2024 2023 CASH FLOWS FROM FINANCING ACTIVITIES: Deposits received on investment-type policyholder contracts 530 - - Withdrawals on investment-type policyholder contracts (214) (212) (197) Drafts outstanding 8 (21) 19 Secured borrowing arrangements: Net proceeds related to repurchase agreements with maturities three months or less (37) 294 204 Gross proceeds related to repurchase agreements with maturities greater than three months 300 511 500 Gross repayments related to repurchase agreements with maturities greater than three months (300) (510) (100) Net proceeds related to securities lending with maturities three months or less 3 - (106) Dividend to parent (50) (300) - Distribution to parent - - (45) Cash flows from (used in) financing activities 240 (238) 275 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (121) (377) 68 CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 563 940 872 CASH AND CASH EQUIVALENTS, END OF YEAR $ 442 $ 563 $ 940 SUPPLEMENTAL CASH FLOW INFORMATION Cash paid during the year (1) Interest $ 1 $ - $ 2 Non-cash transactions(2) Deposits on investment-type policyholder contracts ceded through funds withheld arrangements $ 456 $ - $ - Novation activity on certain ceded investments (3) $ - $ - $ 491 (1) See Note 9 for disclosures regarding income taxes paid. (2) See Note 5 for disclosures regarding non-cash activity related to collateral transferred under repurchase agreements. (3) See Note 8 for further information regarding the novation program associated with Pruco Life Insurance Company ("Pruco Life") See Notes to Consolidated Financial Statements 54
1. BUSINESS AND BASIS OF PRESENTATION Fortitude Life Insurance & Annuity Company and its wholly-owned subsidiaries (collectively, "FLIAC", "we", or the "Company"), with its principal offices in Jersey City, New Jersey, is a wholly-owned subsidiary of Fortitude Group Holdings, LLC ("FGH") and an indirect wholly-owned subsidiary of FGH Parent L.P. ("FGP"). Basis of Presentation The accompanying Consolidated Financial Statements present the consolidated results of operations, financial condition, and cash flows of FLIAC. All intercompany transactions have been eliminated in consolidation. In the opinion of management, all adjustments necessary for a fair statement of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America ("U.S. GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Funding Agreements and Funding Agreement Backed Notes (FABN) In October 2025, FLIAC issued $500 million of funding agreements to Fortitude Global Funding ("FGF"), an unaffiliated statutory trust. The issuance of these funding agreements was made within a FABN program whereby FGF uses the net proceeds from the notes issued under the program to purchase funding agreements from the Company. The funding agreements have matching interest and maturity payment terms with the applicable notes issued under the FABN program. New Reinsurance Transactions In October 2025, FLIAC entered into a reinsurance agreement to cede, on a modified coinsurance basis, at least 85% of its funding agreement liabilities associated with the FABN program to a Bermuda-domiciled affiliate of the Company. The agreement was effective October 6, 2025 and includes funding agreements issued beginning on the effective date. In October 2025, FLIAC entered into a reinsurance agreement with an unaffiliated subsidiary of a U.S. based life insurance company to assume, on a coinsurance basis, a portion of new fixed annuity liabilities, of which 100% of the assumed business was immediately retroceded, on a modified coinsurance basis, to a Bermuda-domiciled affiliate of the Company. The agreement was effective October 6, 2025 and includes new policies beginning on the effective date. Table of Contents Fortitude Life Insurance & Annuity Company 55
2. SIGNIFICANT ACCOUNTING POLICIES AND PRONOUNCEMENTS Fair Value Option We have elected to apply the fair value option on certain of our insurance and reinsurance contracts. We have made this election as it improves our operational efficiency and better aligns the recognition and measurement of our investments, insurance liabilities, and associated reinsurance activity with how we manage the business. See Note 4 for further information. Description of Significant Accounting Policies ASSETS Fixed maturity securities • Fair value option - Fixed maturity securities for which the fair value option has been elected are carried at fair value on the consolidated statements of financial position. Realized and unrealized gains and losses on these investments are reported in "Investment gains (losses), net" on the consolidated statement of operations. • Available for sale - Fixed maturity securities designated as available for sale are carried at fair value on the consolidated statements of financial position. Unrealized gains and losses from available for sale fixed maturity securities are reported as a separate component of accumulated other comprehensive income (loss) ("AOCI"), net of deferred income taxes, with changes in estimated credit losses recognized in "Investment gains (losses), net" on the consolidated statements of operations. Both fair value option and available-for-sale fixed maturity securities are recorded on a trade-date basis, with any unsettled trades recorded in other assets or other liabilities on the consolidated statements of financial position. Interest income, including amortization of premium and accretion of discount, is determined using the effective yield method. Interest income, amortization of premium, accretion of discount, and prepayment premiums are reported in "Net investment income" on the consolidated statements of operations. Yields on both fair value option and available-for-sale fixed maturity securities are determined based on the fixed maturity type. Premiums and discounts arising from the purchase of bonds are treated as yield adjustments over their estimated holding periods, until maturity, or call date, if applicable. The Company reviews its available-for-sale fixed maturity securities portfolio to determine whether a decline in fair value below amortized cost (i.e., impairment) of a debt security is due to credit-related or non credit-related factors. Any impairment that is not credit-related is recognized in other comprehensive income (loss). Credit-related impairment is recognized in earnings through a contra-asset allowance account, unless the Company intends to sell before recovery. If the Company intends to sell the debt security, or it is more likely than not the Company will be required to sell the security before recovery of its amortized cost basis, any allowance for credit losses is written off and the amortized cost basis is written down to the debt security's fair value. Accrued interest is excluded from the measurement of the allowance for credit losses. When determining whether a credit loss exists on available-for-sale securities, the Company estimates the expected credit losses based on a discounted cash flow method, using effective interest rates to discount the expected cash flows associated with each debt security to determine its fair value, which is then compared with its amortized cost basis to derive the credit loss on the security. The methodology and inputs used to determine the credit loss by security type are as follows: • Corporate, municipal, and sovereign fixed maturity securities - The Company considers expected default rates and the timing of such defaults and loss severity, and the timing of any potential recovery. The Company also considers scenarios specific to the issuer and the security, which may include estimates of outcomes of corporate restructurings, political and macroeconomic factors, stability and financial strength of the issuer, the value of any secondary sources of repayment, and the disposition of assets. • Structured fixed maturity securities - Securities included in this category primarily consist of residential mortgage backed securities ("RMBS"), commercial mortgage backed securities ("CMBS"), collateralized debt obligations ("CDO"), and asset-backed securities ("ABS"). The Company considers the historical performance of underlying assets and available market information as well as bond-specific structural considerations, such as credit enhancement and the priority of payment structure of the security. In addition, the process of estimating future cash flows includes, but is not limited to, the following critical inputs, which vary by asset class: Table of Contents Fortitude Life Insurance & Annuity Company 56
◦ current delinquency rates; ◦ expected default rates; and ◦ the timing of such defaults, loss severity and the timing of any recovery, and expected prepayment speeds. Mortgage loans, at fair value - We have elected the fair value option on the entirety of our mortgage loans portfolio which are comprised of commercial and residential mortgage loans. Interest income and prepayment fees are included in "Net investment income" on the consolidated statements of operations. Realized and unrealized gains and losses on these investments are reported in "Investments gains (losses), net" on the consolidated statements of operations. Short-term investments - These investments primarily consist of debt instruments with a maturity of twelve months or less and greater than three months when purchased. These investments are carried at fair value and include short-term debt securities issued by government sponsored or corporate entities. Other invested assets - These investments primarily consist of the following: • Limited partnerships and limited liability companies ("LPs/LLCs") - Interests in LPs/LLCs are accounted for using either the equity method of accounting, or at fair value. The Company's income from investments in LPs/LLCs accounted for using the equity method is included in "Net investment income." The carrying value of these investments is written down, or impaired, to fair value when a decline in value is considered to be other than temporary. In applying the equity method (including assessment for other-than-temporary impairment), the Company uses financial information provided by the investee. For the investments reported at fair value, which are primarily comprised of private equity investments, the Company uses the net asset value ("NAV"), a permitted practical expedient, as an estimate for fair value when it is not readily available. Changes in NAV are reported in "Net investment income" on the consolidated statement of operations. • Policy loans - These investments represent funds loaned to policyholders up to the cash surrender value of the associated insurance policies and are carried at the unpaid principal balances due to the Company from the policyholders. Interest income on policy loans is recognized in "Net investment income" at the contract interest rate when earned. Policy loans are fully collateralized by the cash surrender value of the associated insurance policies. • Derivatives - See "Other Accounting Policies" further below for discussion on derivative financial instruments. Cash and cash equivalents - Cash and cash equivalents include cash on hand, amounts due from banks, certain money market investments, funds managed similar to regulated money market funds, and other debt instruments with maturities of three months or less when purchased. Accrued investment income - Accrued investment income primarily includes accruals of interest and dividend income from investments that have been earned but not yet received. Income taxes - Income taxes represents the net deferred tax asset and, when applicable, the Company's estimated taxes receivable related to the current year and open audit years. The Company's estimated taxes payable for the current year and open audit years, when applicable, are included in Other liabilities. Items required by tax regulations to be included in the tax return may differ from the items reflected in the financial statements. As a result, the effective tax rate reflected in the financial statements may be different than the actual rate applied on the tax return. Some of these differences are permanent such as expenses that are not deductible in the Company's tax return, and some differences are temporary, reversing over time, such as valuation of insurance reserves. Temporary differences create deferred tax assets and liabilities. Deferred tax assets generally represent items that can be used as a tax deduction or credit in future years for which the Company has already recorded the tax benefit in the consolidated statements of operations. Deferred tax liabilities generally represent tax expense recognized in the Company's financial statements for which payment has been deferred, or expenditures for which the Company has already taken a deduction in the Company's tax return but have not yet been recognized in the Company's financial statements. The application of U.S. GAAP requires the Company to evaluate the recoverability of the Company's deferred tax assets and establish a valuation allowance, if necessary, to reduce the Company's deferred tax assets to an amount that is more likely than not expected to be realized. Considerable judgment is required in determining whether a valuation allowance is necessary, and if so, the amount of such valuation allowance. Table of Contents Fortitude Life Insurance & Annuity Company 57
U.S. GAAP prescribes a comprehensive model for how a company should recognize, measure, present, and disclose in its financial statements uncertain tax positions that a company has taken or expects to take on tax returns. The application of this guidance is a two-step process. First, the Company determines whether it is more likely than not, based on the technical merits, that the tax position will be sustained upon examination. If a tax position does not meet the more likely than not recognition threshold, the benefit of that position is not recognized in the financial statements. The second step is measurement. The Company measures the tax position as the largest amount of benefit that is greater than 50 percent likely to be realized upon ultimate resolution with a taxing authority that has full knowledge of all relevant information. This measurement considers the amounts and probabilities of the outcomes that could be realized upon ultimate settlement using the facts, circumstances, and information available at the reporting date. The Company classifies all interest and penalties related to tax uncertainties as income tax expense. The Company's liability for income taxes includes a liability for unrecognized tax benefits, interest and penalties which relate to tax years still subject to review by the Internal Revenue Service ("IRS") or other taxing jurisdictions. Audit periods remain open for review until the statute of limitations has passed. Generally, for tax years which produce net operating losses, capital losses or tax credit carryforwards ("tax attributes"), the statute of limitations does not close, to the extent of these tax attributes, until the expiration of the statute of limitations for the tax year in which they are fully utilized. The completion of review or the expiration of the statute of limitations for a given audit period could result in an adjustment to the liability for income taxes. See Note 9 for additional information regarding income taxes. Goodwill represents the future economic benefits arising from assets acquired in a business combination that are not individually identified and separately recognized. It is the excess of the cost of an acquisition over the fair value of the assets acquired and liabilities assumed at the date of acquisition. During the third quarter of 2023, the Company determined that the goodwill associated with its Retained Business was fully impaired. Accordingly, the Company recorded a goodwill impairment of $93 million through the consolidated statement of operations. Following this impairment, there was no remaining goodwill. Other assets consist primarily of accruals for asset management and service fees and receivables resulting from sales of securities that had not yet settled at the balance sheet date. Other assets also includes receivables from the Company's parent and affiliates. Table of Contents Fortitude Life Insurance & Annuity Company 58
Accounting Policies Specific to the Ceded Business REINSURANCE The Company assumes investment contracts under coinsurance arrangements, all of which are ceded to a Bermuda-domiciled affiliate. The Company follows reinsurance accounting for transactions that provide indemnification against loss or liability relating to insurance risk (risk transfer). To meet risk transfer requirements, a reinsurance agreement must include both insurance risk consisting of both underwriting and timing risks, and a reasonable possibility of a significant loss. The Company cedes both insurance contracts that transfer significant insurance risk and investment-type contracts under coinsurance and modified coinsurance arrangements. If the Company determines that a contract lacks significant mortality risk and thus could not achieve risk transfer, the Company records the contract using the deposit method of accounting. Deposits received on investment-oriented products are not recognized as revenues, because they are recorded directly to policyholder contract deposits upon receipt. Reinsurance recoverables amounts related to contracts for which we have not elected the fair value option are determined using assumptions consistent with those used to measure the underlying insurance liabilities. For reinsurance contracts where we have have elected the fair value option, reinsurance recoverables are measured in a consistent manner with the associated insurance liabilities, which are recorded at fair value. Changes in these reinsurance recoverables and associated insurance liabilities are both recorded through "Policyholder benefits and changes in fair value of insurance liabilities" within the consolidated statements of operations. Net modified coinsurance receivable/payable - As discussed above, we have elected the fair value option on reinsurance contracts that contain modified coinsurance receivables and payables. Modified coinsurance receivables represent the reserve credits for the insurance liabilities covered under the reinsurance agreement with Pruco Life regarding our variable annuity base contracts with guaranteed benefits. The modified coinsurance receivable is measured in a consistent manner with the associated insurance liabilities, which are recorded at fair value. Similarly, modified coinsurance payables primarily represent the fair value of the assets backing the ceded insurance liabilities under the reinsurance agreement. Accordingly, the fair value of the modified coinsurance payable is measured in a consistent manner with the fair value of the assets under the reinsurance agreement. Modified coinsurance receivables and payables are presented on a net basis within the consolidated statements of financial position. Changes in both modified coinsurance receivables and payables are recorded through "Policyholder benefits and changes in fair value of insurance liabilities" within the consolidated statements of operations. Deposit asset - As discussed above, we have elected the fair value option on certain of our reinsurance contracts that contain assets held in trust by the reinsurer, that back the insurance liabilities under the reinsurance agreement with Pruco Life regarding fixed indexed annuities and fixed annuities with a guaranteed lifetime withdrawal income. The deposit asset is measured in a consistent manner with the associated insurance liabilities, which are recorded at fair value. Funds withheld payable to affiliates reflect the fair value of assets backing the ceded insurance liabilities under funds withheld reinsurance agreements for which we have not elected the fair value option. These funds withheld agreements also contain embedded derivatives which are required to be separately valued from their host contracts. The embedded derivatives relate to the contractual rights to receive the return on the segregated portfolio of investments and the performance risk of the individual assets supporting the funds withheld agreement. The embedded derivatives are valued as a total return swap with a floating leg and is computed as the change in fair value of the underlying assets. Changes in the fair value of embedded derivatives are included in "Investment gains (losses), net" in the consolidated statements of operations. For additional information about these reinsurance arrangements see Note 8. Table of Contents Fortitude Life Insurance & Annuity Company 59
LIABILITIES Insurance liabilities, at fair value - We have elected the fair value option on certain of our insurance contracts, which include liabilities for guarantee benefits related to certain long-duration life and annuity contracts, which are discussed more fully in Note 7. These liabilities include reserves for guaranteed minimum death benefits ("GMDB"), guaranteed minimum income benefits ("GMIB"), guaranteed minimum accumulation benefits ("GMAB"), guaranteed minimum withdrawal benefits ("GMWB") and guaranteed minimum income and withdrawal benefits ("GMIWB"). Also included within insurance liabilities are smaller blocks of variable universal life and fixed payout annuity products. Changes in the fair value of insurance contracts are reported in "Policyholder benefits and changes in fair value of insurance liabilities" on the consolidated statements of operations. The assumptions used in establishing reserves are generally based on those a market participant would use and include the Company's experience, industry experience and/or other factors, as applicable. We evaluate, and update when applicable, our actuarial assumptions such as mortality and policyholder behavior assumptions, on an annual basis. Generally, we do not expect trends to change significantly in the short-term and, to the extent these trends may change, we expect such changes to be gradual over the long-term. Policyholder contract deposits - The liability for policyholder contract deposits is recorded at accumulated or fund value (deposits received, plus accrued interest credited, less withdrawals, surrender charges and fees). Policyholder contract deposits are comprised of funding agreements and deferred annuity products. Liabilities related to secured borrowing arrangements Securities repurchase agreements that satisfy certain criteria are treated as secured borrowing arrangements and are carried at the amounts at which the securities will be subsequently reacquired, as specified in the respective transactions. As part of securities repurchase agreements, the Company primarily transfers fixed maturity securities to a third-party and receives cash as collateral, which is subsequently reinvested in higher yielding assets. The market value of the securities to be repurchased is monitored, and additional collateral is obtained where appropriate, to protect against credit exposure. The Company obtains collateral in an amount at least equal to 95% of the fair value of the securities sold. The securities to be repurchased are the same, or substantially the same, as those sold. The majority of these transactions are with highly rated financial institutions. Income and expenses related to these transactions, all of which are used to earn spread income, are reported within "Net investment income". Securities lending transactions are used primarily to earn spread income or to facilitate trading activity. As part of securities lending transactions, the Company transfers U.S. and foreign debt and equity securities, as well as U.S. government and government agency securities, and receives cash as collateral. Cash proceeds from securities lending transactions are primarily used to earn spread income, and are typically invested in cash equivalents, short-term investments or fixed maturities. Securities lending transactions are treated as financing arrangements and are recorded at the amount of cash received. The Company obtains collateral in an amount equal to 102% and 105% of the fair value of the domestic and foreign securities, respectively. The Company monitors the market value of the securities loaned on a daily basis with additional collateral obtained as necessary. Substantially all of the Company's securities lending transactions are with large brokerage firms and large banks. Income and expenses associated with securities lending transactions used to earn spread income are reported as "Net investment income". Other liabilities consists primarily of accrued expenses, technical overdrafts, payables resulting from purchases of securities that had not yet settled at the balance sheet date, and payables to the Company's parent and affiliates. Other liabilities may also include derivative instruments for which fair values are determined as described below under "Other Accounting Policies". Commitments and contingent liabilities are accrued if it is probable that a liability has been incurred and an amount is reasonably estimable. Management evaluates whether there are incremental legal or other costs directly associated with the ultimate resolution of the matter that are reasonably estimable and, if so, they are included in the accrual. When applicable, these accruals are generally reported in "Other liabilities". Table of Contents Fortitude Life Insurance & Annuity Company 60
REVENUES AND BENEFITS AND EXPENSES Insurance Revenue and Expense Recognition Revenues for variable life and annuity contracts and supplemental contracts with life contingencies primarily consist of charges against contractholder account values or separate accounts for mortality and expense risks, administration fees, and surrender charges. Revenues for mortality and expense risk charges and administration fees are recognized as assessed against the contractholder and are included within "Policy charges and fee income" on the consolidated statements of operations. Surrender charge revenue is recognized when the surrender charge is assessed against the contractholder at the time of surrender and is also included in "Policy charges and fee income" on the consolidated statements of operations. Liabilities for variable life insurance contracts and the variable investment options on annuity contracts represent the account value of the contracts and are included in "Separate account liabilities". Revenues for fixed annuity and fixed supplementary contracts with and without life contingencies consist of investment income earned from the investment of deposits in the Company's general account portfolio. In addition, revenues for fixed immediate annuity contracts with life contingencies also consist of single premium payments recognized as annuity considerations when received. Amounts received as payment for variable annuities and other contracts without life contingencies are reported as deposits to "Insurance liabilities" and/or "Separate account liabilities." Benefits and expenses for these products include claims in excess of related account balances and expenses of contract administration. Asset management and service fees principally include asset-based asset management fees, which are recognized in the period in which the services are performed. Other income primarily includes foreign exchange gains and losses related to certain currency derivatives and the associated hedged items. Also included in other income are realized and unrealized activity related to certain private equity investments that are reported in "Other invested assets". Investment gains (losses), net includes unrealized and realized gains or losses on various investment classes, as outlined above, and also includes non-foreign exchange-related derivative gains or losses. The gains and losses on these derivatives include the impact of maturities, terminations, and changes in the fair value of both derivative instruments and embedded derivatives associated with funds withheld arrangements. OTHER ACCOUNTING POLICIES Derivative Financial Instruments Derivatives are financial instruments whose values are derived from interest rates, foreign exchange rates, financial indices, values of securities or commodities, credit spreads, market volatility, expected returns, and liquidity. Values can also be affected by changes in estimates and assumptions, including those related to counterparty behavior and non-performance risk ("NPR") used in valuation models. Derivative financial instruments generally used by the Company include swaps, futures, forwards and options and may be exchange-traded or contracted in the over-the-counter ("OTC") market. Certain of the Company's OTC derivatives are cleared and settled through central clearing counterparties, while others are bilateral contracts between the Company and a counterparty. Derivative positions are carried at fair value, generally by obtaining quoted market prices or a third-party valuation. Derivatives are generally used to manage the interest rate and currency characteristics of assets or liabilities. Additionally, derivatives may be used to reduce exposure to interest rate, credit, foreign currency and equity risks associated with assets held or expected to be purchased or sold, and liabilities incurred or expected to be incurred. The Company does not designate any derivatives as instruments that qualify for hedge accounting treatment. Accordingly, all realized and unrealized changes in the fair value of derivatives for periods are recorded in current earnings within either "Investment gains (losses), net" or "Other income" on the consolidated statements of operations. Cash flows related to derivatives that function as economic hedges are classified in the consolidated statements of cash flows following the classification of the cash flows of the economically-hedged items. Table of Contents Fortitude Life Insurance & Annuity Company 61
Derivatives, including embedded derivatives associated with fund withheld agreements, are recorded either as assets, within "Other invested assets," or as liabilities, within "Other liabilities" on the consolidated statements of financial position. The Company nets the fair value of all derivative financial instruments with counterparties for which a master netting arrangement has been executed. Cash collateral pledged in excess of derivative liabilities and cash collateral received in excess of derivative assets are recorded within "Other invested assets" and "Other liabilities", respectively. Separate account assets and liabilities - We have elected the fair value option on insurance contracts that hold both segregated assets, which are invested for certain contractholders, and segregated liabilities, which are equal and offsetting to the segregated assets, and represent the contractholders account balance in those segregated assets, and to a lesser extent, borrowings of the separate account. These assets and liabilities are reported at fair value and separately disclosed on the consolidated statements of financial condition. The contractholder has the option of directing funds within the separate accounts to a wide variety of investment options, most of which invest in mutual funds. The investment risk on the variable portion of a contract is borne by the contractholder, except to the extent of minimum guarantees by the Company, which are not separate account liabilities. The assets of each account are legally segregated and are not subject to claims that arise out of any other business of the Company. The investment income and realized investment gains or losses from separate account assets accrue to the contractholders and are not included in the Company's consolidated statements of operations. Table of Contents Fortitude Life Insurance & Annuity Company 62
RECENT ACCOUNTING PRONOUNCEMENTS Changes to U.S. GAAP are established by the Financial Accounting Standards Board ("FASB") in the form of Accounting Standard Updates ("ASU") to the FASB Accounting Standards Codification ("ASC"). We consider the applicability and impact of all ASUs. ASUs listed below include those that have been adopted during the current fiscal year and/or those that have been issued but not yet adopted as of December 31, 2025 and as of the date of this filing. ASUs not listed below were assessed and determined to be either not applicable or not material to the Company. ASUs adopted as of December 31, 2025 Standard Description Effective date and method of adoption Effect on the financial statements or other significant matters ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures This ASU improves income tax disclosure requirements by requiring 1. the use of consistent categories and greater disaggregation of information in the rate reconciliation and 2. income taxes paid disaggregated by jurisdiction. The Company adopted this update for annual reporting periods on January 1, 2025 using the retrospective method. The update expanded the Company's disclosures but did not have an impact on its financial position or results of operations. ASU issued but not yet adopted as of December 31, 2025 Standard Description Effective date and method of adoption Effect on the financial statements or other significant matters ASU 2024-03, Income Statement - Reporting Comprehensive Income (Topic 220): Expense Disaggregation Disclosures This ASU requires additional disclosures regarding certain expense types included in the income statement. The requirements include disclosure of the amounts associated with 1. purchases of inventory, 2. employee compensation, 3. depreciation and 4. intangible asset amortization. These disclosures should be included in each relevant expense caption. Furthermore, entities must disclose specific expenses, gains, or losses already required under US GAAP, offer a qualitative description of amounts not separately quantified, and present the total amount of selling expenses along with a definition of these expenses in their annual reports. Effective for annual reporting periods beginning January 1, 2027, and interim reporting periods beginning January 1, 2028, using either the prospective or retrospective method. Early adoption is permitted The Company is currently evaluating the impact of this disclosure-only requirement. Table of Contents Fortitude Life Insurance & Annuity Company 63
3. SEGMENT INFORMATION FLIAC has two reportable segments, which we refer to as the "Retained Business" and the "Ceded Business." The Retained Business primarily consists of variable annuity products with guaranteed lifetime withdrawal benefit features as well as smaller blocks of variable annuity products with certain other living benefit and death benefit features. The Retained Business also includes variable universal life and fixed payout annuity products. The Ceded Business is comprised of registered index-linked annuities and fixed annuities, which includes fixed indexed and fixed deferred annuities, and other variable annuities, that have been fully ceded to Prudential Insurance and Pruco Life. The Ceded business also includes funding agreements issued under a FABN program where at least 85 percent of the business has been ceded to a Bermuda-domiciled affiliate of the Company. The entirety of the funding agreement business is included within this segment. Also included in this segment are certain assumed fixed annuities that have been fully retroceded to a Bermuda- domiciled affiliate of the Company. See Note 8 for further information. Segment Reporting Considerations The Retained Business and Ceded Business segments are reported in a manner consistent with the internal reporting package provided to the CODM, whose title and position is "Managing Director, FLIAC Business Leader." The CODM assesses performance for both the Retained and Ceded segments and decides how to allocate resources based upon consolidated comprehensive income (loss). The CODM uses consolidated comprehensive income (loss) to assess financial performance, primarily through the quarterly monitoring of actual versus budgeted results. Included in this assessment is a review of the impacts on earnings related to: • market movements and hedging performance regarding equity market and interest rate changes; • liability valuations and changes in the fair value of guarantees; • actuarial assumption updates; and • operating expenses Table of Contents Fortitude Life Insurance & Annuity Company 64
Segment Balance Sheets The following is the consolidated balance sheet by segment: December 31, 2025 2024 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) ASSETS Total investments $ 4,266 $ 2,259 $ 6,525 $ 4,062 $ 1,727 $ 5,789 Cash and cash equivalents 169 273 442 498 65 563 Accrued investment income 50 13 63 46 12 58 Reinsurance recoverables - 607 607 - 163 163 Deposit asset - 287 287 - 364 364 Income taxes 91 - 91 76 - 76 Other assets 31 1 32 69 - 69 Separate account assets 20,282 1,991 22,273 20,842 2,015 22,857 TOTAL ASSETS $ 24,889 $ 5,431 $ 30,320 $ 25,593 $ 4,346 $ 29,939 LIABILITIES AND EQUITY LIABILITIES Insurance liabilities $ 2,133 $ 2,216 $ 4,349 $ 2,196 $ 2,184 $ 4,380 Policyholder contract deposits - 535 535 - - - Funds withheld payable to affiliates - 495 495 - - - Net modified coinsurance payable - 150 150 - 145 145 Liabilities associated with secured borrowing arrangements 1,180 3 1,183 1,200 - 1,200 Other liabilities 177 41 218 206 2 208 Separate account liabilities 20,282 1,991 22,273 20,842 2,015 22,857 TOTAL LIABILITIES 23,772 5,431 29,203 24,444 4,346 28,790 EQUITY 1,117 - 1,117 1,149 - 1,149 TOTAL LIABILITIES AND EQUITY $ 24,889 $ 5,431 $ 30,320 $ 25,593 $ 4,346 $ 29,939 Table of Contents Fortitude Life Insurance & Annuity Company 65
Segment Income Statements The following is the consolidated comprehensive income (loss) by segment. Year Ended December 31, 2025 2024 2023 Retained Business Ceded Business Total Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) REVENUES Premiums $ 31 $ - $ 31 $ 35 $ - $ 35 $ 27 $ - $ 27 Policy charges and fee income 421 - 421 452 - 452 456 - 456 Net investment income (1) 212 65 277 230 62 292 240 75 315 Asset management and service fees 87 - 87 93 - 93 91 - 91 Other income (loss) (7) 1 (6) 8 - 8 (1) 2 1 Investment gains (losses), net (398) 184 (214) (908) 220 (688) (623) 313 (310) TOTAL REVENUES 346 250 596 (90) 282 192 190 390 580 BENEFITS AND EXPENSES Policyholder benefits and changes in fair value of insurance liabilities 91 249 340 (365) 282 (83) (50) 390 340 Interest credited to policyholders' account balances - 1 1 - - - - - - Commission expense 83 - 83 91 - 91 90 - 90 Goodwill impairment - - - - - - 93 - 93 General, administrative and other expenses (2) 66 - 66 80 - 80 67 - 67 TOTAL BENEFITS AND EXPENSES 240 250 490 (194) 282 88 200 390 590 INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES 106 - 106 104 - 104 (10) - (10) Less: Income tax expense (benefit) 12 - 12 32 - 32 (6) - (6) NET INCOME (LOSS) $ 94 $ - $ 94 $ 72 $ - $ 72 $ (4) $ - $ (4) Other comprehensive income (loss), before tax: Changes in own-credit risk related to insurance liabilities $ (96) $ - $ (96) $ 19 $ - $ 19 $ (223) $ - $ (223) Less: Income tax expense (benefit) (20) - (20) 4 - 4 (47) - (47) Other comprehensive income (loss), net of taxes (76) - (76) 15 - 15 (176) - (176) COMPREHENSIVE INCOME (LOSS) $ 18 $ - $ 18 $ 87 $ - $ 87 $ (180) $ - $ (180) (1) For the years ended December 31, 2025, 2024, and 2023 investment expenses within the Retained Business include $62 million, $68 million, and $33 million, respectively, of expense related to liabilities associated with repurchase agreements. (2) Represents "other segment items," which include expense charges and allocations from FGH, reinsurer expense allowances, professional service fees, and certain other miscellaneous expenses. Table of Contents Fortitude Life Insurance & Annuity Company 66
4. FAIR VALUE OF ASSETS AND LIABILITIES Fair Value Measurement - Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative fair value guidance establishes a framework for measuring fair value that includes a hierarchy used to classify the inputs used in measuring fair value. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The levels of the fair value hierarchy are as follows: Level 1 - Fair value is based on unadjusted quoted prices in active markets that are accessible to the Company for identical assets or liabilities. Level 2 - Fair value is based on significant inputs, other than quoted prices included in Level 1, that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability through corroboration with observable market data. Level 2 inputs include quoted market prices in active markets for similar assets and liabilities, quoted market prices in markets that are not active for identical or similar assets or liabilities, and other market observable inputs. Level 3 - Fair value is based on at least one significant unobservable input for the asset or liability. The assets and liabilities in this category may require significant judgment or estimation in determining the fair value. Fair Value Option Election As discussed in Note 2, we have elected to adopt the fair value option on certain of our insurance and reinsurance contracts. As a result of this election, we do not separately disclose on our consolidated balance sheets, or provide any associated disclosures, regarding liabilities for future policyholder benefits, market risk benefits, or deferred acquisition costs for contracts under the fair value option as would typically be required under ASC 944. See Note 14 for certain disclosures regarding our separate account assets and liabilities. The following are the financial assets and liabilities impacted by our fair value option election noted above: • Certain fixed maturity securities • Mortgage loans • Certain reinsurance recoverables • Separate account assets and liabilities • Net modified coinsurance receivable/payable • Deposit asset • Certain insurance liabilities See further below for a discussion of the Company's valuation methodologies for assets and liabilities measured at fair value and the fair value hierarchy. Table of Contents Fortitude Life Insurance & Annuity Company 67
Assets and Liabilities by Hierarchy Level - The tables below present the balances of assets and liabilities reported at fair value on a recurring basis: December 31, 2025 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Total Business Assets Fixed maturity securities, fair value option U.S Treasury securities and obligations of U.S. government authorities and agencies $ - $ 479 $ - $ - $ 479 Foreign government bonds - 1 - - 1 U.S. corporate public securities - 2,607 - - 2,607 U.S. corporate private securities - 142 222 - 364 Foreign corporate public securities - 268 - - 268 Foreign corporate private securities - 24 68 - 92 Asset-backed securities (2) - 1,128 111 - 1,239 Commercial mortgage-backed securities - 29 - - 29 Residential mortgage-backed securities - 108 - - 108 Total fixed maturity securities, fair value option - 4,786 401 - 5,187 Fixed maturity securities, available for sale Foreign government bonds - 2 - - 2 U.S. corporate public securities - 4 - - 4 U.S. corporate private securities - - 40 - 40 Foreign corporate public securities - 4 - - 4 Asset-backed securities (2) - 125 66 - 191 Commercial mortgage-backed securities - 6 - - 6 Total fixed maturity securities, available for sale - 141 106 - 247 Mortgage loans (3) - - 533 - 533 Short-term investments - - 7 - 7 Cash and cash equivalents 442 - - - 442 Other invested assets - derivatives 2 1,136 - (655) 483 Other invested assets - real estate owned - - 3 - 3 Deposit asset - - 287 - 287 Reinsurance recoverables - - 144 - 144 Subtotal excluding separate account assets 444 6,063 1,481 (655) 7,333 Separate account assets - 22,273 - - 22,273 Total assets $ 444 $ 28,336 $ 1,481 $ (655) $ 29,606 Liabilities Insurance liabilities $ - $ - $ 4,349 $ - $ 4,349 Other liabilities - derivatives 2 1,166 - (1,123) 45 Funds withheld payable to affiliates 127 125 243 - 495 Net modified coinsurance payable - - 150 - 150 Separate account liabilities - 22,273 - - 22,273 Total liabilities $ 129 $ 23,564 $ 4,742 $ (1,123) $ 27,312 (1) "Netting" amounts represent offsetting considerations as disclosed in Note 6. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) As of December 31, 2025, the aggregate fair value of mortgage loans exceeded the aggregate unpaid principal by $8 million. Excluded from the above chart are private equity funds, for which fair value is measured at NAV per share (or its equivalent) as a practical expedient. At December 31, 2025, the fair values of these private equity funds was $28 million. Table of Contents Fortitude Life Insurance & Annuity Company 68
The table below presents the balances of assets and liabilities reported at fair value on a recurring basis for the Retained Business: December 31, 2025 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Retained Business Assets Fixed maturity securities, fair value option U.S Treasury securities and obligations of U.S. government authorities and agencies $ - $ 400 $ - $ - $ 400 Obligations of U.S. states and their political subdivisions - - - - - U.S. corporate public securities - 1,883 - - 1,883 U.S. corporate private securities - - 222 - 222 Foreign corporate public securities - 106 - - 106 Foreign corporate private securities - - 68 - 68 Asset-backed securities (2) - 1,052 66 - 1,118 Commercial mortgage-backed securities - 29 - - 29 Residential mortgage-backed securities - 3 - - 3 Total fixed maturity securities, fair value option - 3,473 356 - 3,829 Mortgage loans (3) - - 363 - 363 Cash and cash equivalents 169 - - - 169 Other invested assets - derivatives 2 632 - (622) 12 Other invested assets - real estate owned - - 3 - 3 Subtotal excluding separate account assets 171 4,105 722 (622) 4,376 Separate account assets - 20,282 - - 20,282 Total assets $ 171 $ 24,387 $ 722 $ (622) $ 24,658 Liabilities Insurance liabilities $ - $ - $ 2,133 $ - $ 2,133 Other liabilities - derivatives 2 1,128 - (1,090) 40 Separate account liabilities - 20,282 - - 20,282 Total liabilities $ 2 $ 21,410 $ 2,133 $ (1,090) $ 22,455 (1) "Netting" amounts represent offsetting considerations as disclosed in Note 6. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) As of December 31, 2025, the aggregate fair value of mortgage loans exceeded the aggregate unpaid principal by $8 million. Excluded from the above chart are private equity funds, for which fair value is measured at NAV per share (or its equivalent) as a practical expedient. At December 31, 2025, the fair values of these private equity funds was $28 million. Table of Contents Fortitude Life Insurance & Annuity Company 69
The table below present the balances of assets and liabilities reported at fair value on a recurring basis for the Ceded Business: December 31, 2025 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Ceded Business Assets Fixed maturity securities, fair value option U.S Treasury securities and obligations of U.S. government authorities and agencies $ - $ 79 $ - $ - $ 79 Foreign government bonds - 1 - - 1 U.S. corporate public securities - 724 - - 724 U.S. corporate private securities - 142 - - 142 Foreign corporate public securities - 162 - - 162 Foreign corporate private securities - 24 - - 24 Asset-backed securities (2) - 76 45 - 121 Residential mortgage-backed securities - 105 - - 105 Total fixed maturity securities, fair value option - 1,313 45 - 1,358 Fixed maturity securities, available for sale Foreign government bonds - 2 - - 2 U.S. corporate public securities - 4 - - 4 U.S. corporate private securities - - 40 - 40 Foreign corporate public securities - 4 - - 4 Asset-backed securities (2) - 125 66 - 191 Commercial mortgage-backed securities - 6 - - 6 Total fixed maturity securities, available for sale - 141 106 - 247 Mortgage loans (3) - - 170 - 170 Short-term investments - - 7 - 7 Cash and cash equivalents 273 - - - 273 Other invested assets - derivatives - 504 - (33) 471 Deposit asset - - 287 - 287 Reinsurance recoverables - - 144 - 144 Subtotal excluding separate account assets 273 1,958 759 (33) 2,957 Separate account assets - 1,991 - - 1,991 Total assets $ 273 $ 3,949 $ 759 $ (33) $ 4,948 Liabilities Insurance liabilities $ - $ - $ 2,216 $ - $ 2,216 Other liabilities - derivatives - 38 - (33) 5 Funds withheld payable to affiliates 127 125 243 - 495 Net modified coinsurance payable - - 150 - 150 Separate account liabilities - 1,991 - - 1,991 Total liabilities $ 127 $ 2,154 $ 2,609 $ (33) $ 4,857 (1) "Netting" amounts represent offsetting considerations as disclosed in Note 6. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) As of December 31, 2025, the aggregate fair value of mortgage loans exceeded the aggregate unpaid principal by $8 million. Table of Contents Fortitude Life Insurance & Annuity Company 70
December 31, 2024 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Total Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ - $ 479 $ - $ - $ 479 Obligations of U.S. states and their political subdivisions - 112 - - 112 Foreign government bonds - 1 - - 1 U.S. corporate public securities - 2,775 - - 2,775 U.S. corporate private securities - 148 272 - 420 Foreign corporate public securities - 270 - - 270 Foreign corporate private securities - 29 68 - 97 Asset-backed securities (2) - 618 81 - 699 Commercial mortgage-backed securities - 34 - - 34 Residential mortgage-backed securities - 119 3 - 122 Total fixed maturity securities $ - $ 4,585 $ 424 $ - $ 5,009 Mortgage loans (3) - - 364 - 364 Short-term investments - 8 - - 8 Cash and cash equivalents 563 - - - 563 Other invested assets - derivatives 36 940 - (649) 327 Deposit asset - - 364 - 364 Reinsurance recoverables - - 163 - 163 Subtotal excluding separate account assets 599 5,533 1,315 (649) 6,798 Separate account assets - 22,857 - - 22,857 Total assets $ 599 $ 28,390 $ 1,315 $ (649) $ 29,655 Liabilities Insurance liabilities - - 4,380 - 4,380 Other liabilities - derivatives 9 1,112 - (1,035) 86 Net modified coinsurance payable - - 145 - 145 Separate account liabilities - 22,857 - - 22,857 Total liabilities $ 9 $ 23,969 $ 4,525 $ (1,035) $ 27,468 (1) "Netting" amounts represent offsetting considerations as disclosed in Note 6. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) As of December 31, 2024, the aggregate fair value of mortgage loans exceeded the aggregate unpaid principal by $10 million. Excluded from the above chart are certain private equity funds, which are classified as other invested assets on the consolidated statements of financial position. Also excluded from the above chart are beneficial interests held through private equity funds that are classified as fixed maturity securities, for which fair value is measured at NAV per share (or its equivalent) as a practical expedient. At December 31, 2024, the fair values of these private equity funds and beneficial interests were $27 million and $13 million, respectively. Table of Contents Fortitude Life Insurance & Annuity Company 71
The table below present the balances of assets and liabilities reported at fair value on a recurring basis for the Retained Business: December 31, 2024 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Retained Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ - $ 402 $ - $ - $ 402 Obligations of U.S. states and their political subdivisions - 112 - - 112 U.S. corporate public securities - 1,969 - - 1,969 U.S. corporate private securities - - 271 - 271 Foreign corporate public securities - 107 - - 107 Foreign corporate private securities - - 64 - 64 Asset-backed securities (2) - 568 70 - 638 Commercial mortgage-backed securities - 34 - - 34 Residential mortgage-backed securities - 8 3 - 11 Total fixed maturity securities $ - $ 3,200 $ 408 $ - $ 3,608 Mortgage loans (3) - - 364 - 364 Cash and cash equivalents 498 - - - 498 Other invested assets - derivatives 36 593 - (615) 14 Subtotal excluding separate account assets 534 3,793 772 (615) 4,484 Separate account assets - 20,842 - - 20,842 Total assets $ 534 $ 24,635 $ 772 $ (615) $ 25,326 Liabilities Insurance liabilities - - 2,196 - 2,196 Other liabilities - derivatives 9 1,078 - (1,001) 86 Separate account liabilities - 20,842 - - 20,842 Total liabilities $ 9 $ 21,920 $ 2,196 $ (1,001) $ 23,124 (1) "Netting" amounts represent offsetting considerations as disclosed in Note 6. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) As of December 31, 2024, the aggregate fair value of mortgage loans exceeded the aggregate unpaid principal by $10 million. Excluded from the above chart are certain private equity funds, which are classified as other invested assets on the consolidated statements of financial position. Also excluded from the above chart are beneficial interests held through private equity funds that are classified as fixed maturity securities, for which fair value is measured at NAV per share (or its equivalent) as a practical expedient. At December 31, 2024, the fair values of these private equity funds and beneficial interests were $27 million and $13 million, respectively. Table of Contents Fortitude Life Insurance & Annuity Company 72
The table below present the balances of assets and liabilities reported at fair value on a recurring basis for the Ceded Business: December 31, 2024 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Ceded Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ - $ 77 $ - $ - $ 77 Foreign government bonds - 1 - - 1 U.S. corporate public securities - 806 - - 806 U.S. corporate private securities - 148 1 - 149 Foreign corporate public securities - 163 - - 163 Foreign corporate private securities - 29 4 - 33 Asset-backed securities (2) - 50 11 - 61 Residential mortgage-backed securities - 111 - - 111 Total fixed maturity securities $ - $ 1,385 $ 16 $ - $ 1,401 Short-term investments - 8 - - 8 Cash and cash equivalents 65 - - - 65 Other invested assets - derivatives - 347 - (34) 313 Deposit asset - - 364 - 364 Reinsurance recoverables - - 163 - 163 Subtotal excluding separate account assets 65 1,740 543 (34) 2,314 Separate account assets - 2,015 - - 2,015 Total assets $ 65 $ 3,755 $ 543 $ (34) $ 4,329 Liabilities Insurance liabilities - - 2,184 - 2,184 Other liabilities - derivatives - 34 - (34) - Net modified coinsurance payable - - 145 - 145 Separate account liabilities - 2,015 - - 2,015 Total liabilities $ - $ 2,049 $ 2,329 $ (34) $ 4,344 (1) "Netting" amounts represent offsetting considerations as disclosed in Note 6. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. Table of Contents Fortitude Life Insurance & Annuity Company 73
The methods and assumptions the Company uses to estimate the fair value of assets and liabilities measured at fair value on a recurring basis are summarized below. Fixed Maturity Securities - Whenever available, we obtain quoted prices in active markets for identical assets at the balance sheet date to measure fixed maturity securities at fair value. Market price data is generally obtained from dealer markets. We employ multiple independent third-party valuation service providers that gather, analyze, and interpret market information to derive fair value estimates for individual investments, based upon market-accepted methodologies and assumptions. The methodologies used by these independent third-party valuation service providers are reviewed and understood by management, through periodic discussion with and information provided by the independent third-party valuation service providers, and a vendor hierarchy is maintained by asset type based on historical pricing experience and vendor expertise. The Company ultimately uses the price from the pricing service highest in the vendor hierarchy based on the respective asset type. The pricing hierarchy is updated, as needed, for new financial products. When observable price quotations are not available, indicative broker quotes, asset manager pricing, or third-party valuation specialist pricing is used for valuation. Fair value can be determined based on discounted cash flow models using discount rates based on credit spreads, yields or price levels of comparable securities, adjusted for illiquidity and structure. The significant unobservable inputs used in the fair value measurement of these investments are liquidity discount rates applied to each of the net tangible book value multiples used in the internal valuation models, and discount rates applied to the expected cash flows of the underlying entities in various scenarios. These unobservable inputs in isolation can cause significant increases or decreases in fair value. Generally, an increase in the liquidity discount rate or discount rates would result in a decrease in the fair value of these private investments. Asset manager overrides and indicative broker quotes are generally included in Level 3 in the fair value hierarchy. Derivative Instruments (Other invested assets and other liabilities) - The fair values of derivative contracts can be affected by changes in interest rates, foreign exchange rates, credit spreads, market volatility, expected returns, liquidity and other factors. The Company's exchange-traded futures and options include treasury and equity futures. Exchange-traded futures and options are valued using quoted prices in active markets and are classified within Level 1 in the fair value hierarchy. The majority of the Company's derivative positions are traded in the OTC derivative market and are classified within Level 2 in the fair value hierarchy. OTC derivatives classified within Level 2 are valued using models that utilize actively quoted or observable market inputs from external market data providers, third-party pricing vendors and/or recent trading activity. The Company's policy is to use mid-market pricing in determining its best estimate of fair value. The fair values of most OTC derivatives, including interest rate and cross-currency swaps, currency forward contracts and credit default swaps are determined using discounted cash flow models. The Company's cleared interest rate swaps and credit derivatives linked to an index are valued using models that utilize actively quoted or observable market inputs, including the secured overnight financing rate ("SOFR"), obtained from external market data providers, third-party pricing vendors, and/or recent trading activity. These derivatives are classified as Level 2 in the fair value hierarchy. Mortgage loans - Fair value for mortgage loans is based upon the present value of the expected future cash flows discounted at the appropriate U.S. Treasury rate or foreign government bond rate (for non-U.S. dollar-denominated loans) plus an appropriate credit spread for loans of similar quality, average life and currency. The quality ratings for these loans, a primary determinant of the credit spreads and a significant component of the pricing process, are based on the asset manager's internally developed methodology. Certain commercial mortgage loans are valued incorporating additional factors, including the terms of the loans and the principal exit strategies for the loans, prevailing interest rates and credit risk. Cash and cash equivalents - Cash and cash equivalents, including certain money market instruments, are primarily valued using unadjusted quoted prices in active markets that are accessible for identical assets. Short-term investments - Fair values of short term investments are generally based on market observable inputs and are primarily classified as Level 2. Short-term investments with a Level 3 classification generally represent debt instruments with a maturity of twelve months or less and greater than three months when purchased. Table of Contents Fortitude Life Insurance & Annuity Company 74
Separate account assets and liabilities - Separate account assets are comprised of mutual funds that contain various underlying investments such as fixed maturity securities, treasuries, and equity securities. These mutual funds generally transact regularly but do not typically trade in active markets because they are not publicly available, accordingly, fair values are based on transaction prices of identical fund shares. Separate account liabilities are recorded at the amount credited to the contractholder, which reflects the change in fair value of the corresponding separate account assets including contractholder deposits less withdrawals and fees. Reinsurance recoverable, fair value option - These assets represents a recoverable backing insurance liabilities associated with insurance contracts where we have elected the fair value option under the reinsurance agreement with Prudential Insurance. The fair value of the reinsurance recoverable is measured in a consistent manner with the associated insurance liabilities, which are also recorded at fair value. See discussion of the fair value determination for insurance liabilities below. Modified coinsurance agreement receivables and payables - Modified coinsurance receivables represent the reserve credits associated with insurance contracts for which we have elected the fair value option under the reinsurance agreement with Pruco Life regarding our variable annuity base contracts with guaranteed benefits. The modified coinsurance receivable is measured in a consistent manner with the associated insurance liabilities, which are recorded at fair value. Similarly, modified coinsurance payables associated with insurance contracts for which we have elected the fair value option primarily represent the fair value of the assets backing the ceded insurance liabilities under the reinsurance agreement. Accordingly, the fair value of the modified coinsurance payable is measured in a consistent manner with the fair value of the assets under the reinsurance agreement. Deposit asset - The deposit asset represents assets, held in trust by the reinsurer, that back the liabilities associated with insurance contracts for which we have elected the fair value option under the reinsurance agreement regarding our fixed indexed annuities and fixed annuities with a guaranteed lifetime withdrawal income. The deposit is measured in a consistent manner with the associated insurance liabilities, which are recorded at fair value. Accordingly, the fair value of our deposit asset is determined by the fair value calculation of our insurance liabilities. See discussion of the fair value determination for insurance liabilities below. Insurance liabilities, at fair value - Fair values associated with insurance contracts for which we have elected the fair value option are calculated as the present value of future expected benefit payments to customers, anticipated future trail commissions paid to agents and certain administrative expenses less the present value of future expected rider fees, M&E charges, contract charges and the anticipated future reimbursement of certain asset management fees. Since there is no observable active market for the transfer of these obligations, the valuations are calculated using internally developed models with option pricing techniques. The models are based on a risk neutral valuation framework and incorporate premiums for risks inherent in valuation techniques, inputs, and the general uncertainty around the timing and amount of future cash flows. The determination of these risk premiums requires the use of management's judgment. The significant inputs to the valuation models are primarily unobservable and include capital market assumptions, such as interest rate levels and volatility assumptions, as well as actuarially-determined assumptions, including contractholder behavior, such as lapse rates, benefit utilization rates, withdrawal rates, and mortality rates. Funds withheld payable to affiliates reflect the fair value of the underlying assets collateralizing the funds withheld payable, inclusive of the associated embedded derivative, and is generally based on market observable inputs using industry standard valuation techniques but also require certain significant unobservable inputs for specific asset classes. The level in the fair value hierarchy assigned to the funds withheld payable is based upon the observability of inputs used to value the underlying investment assets held at fair value within the funds withheld portfolio. Quantitative Information Regarding Internally-Priced Level 3 Assets and Liabilities - The tables below present information about the significant unobservable inputs used for recurring fair value measurements regarding certain Level 3 assets and liabilities. Table of Contents Fortitude Life Insurance & Annuity Company 75
December 31, 2025 Fair Value Valuation Techniques Unobservable Inputs Minimum Maximum Weighted Average Impact of Increase in Input on Fair Value (1) (in millions) Assets: Retained business Fixed maturity securities U.S. corporate private securities $ 178 Discounted cash flow Discount rate 4.71 % 8.63 % 6.58 % Decrease Foreign corporate private securities 46 Discounted cash flow Discount rate 4.76 % 7.00 % 5.93 % Decrease Asset-backed securities 24 Discounted cash flow Discount rate 5.95 % 12.22 % 8.83 % Decrease Mortgage loans 284 Level yield Market yield 4.43 % 10.82 % 6.35 % Decrease 79 Discounted cash flow Discount rate 5.49 % 6.39 % 6.13 % Decrease Total Mortgage loans 363 Other invested assets - real estate owned 3 Trade price Trade price NA NA NA Increase Ceded business U.S. corporate private securities 40 Trade price Trade price NA NA NA Increase Asset-backed securities 12 Trade price Trade price NA NA NA Increase 59 Discounted cash flow Discount rate 5.82 % 6.57 % 6.12 % Decrease Total Assets-backed securities 71 Mortgage loans 134 Level yield Market yield 5.32 % 7.83 % 6.23 % Decrease 36 Trade price Trade price NA NA NA Increase Total Mortgage loans 170 Short term investments 7 Trade price Trade price NA NA NA Increase Deposit asset 287 Fair values are determined using the same unobservable inputs as insurance liabilities. Reinsurance recoverables 144 Fair values are determined using the same unobservable inputs as insurance liabilities. Liabilities: Insurance liabilities Retained business (1) $ 2,133 Discounted cash flow Equity volatility curve 15 % 26 % Increase Lapse rate 0.55 % 13 % Decrease Spread over risk free 0.33 % 1.87 % Decrease Utilization rate 87.5 % 100 % Increase Withdrawal rate See table footnote (2) below. Mortality rate 0 % 16 % Decrease Ceded business (1) 2,216 Discounted cash flow Equity volatility curve 15 % 26 % Increase Lapse rate 0.55 % 13 % Decrease Spread over risk free 0.50 % 0.50 % Decrease Utilization rate 87.5 % 100 % Increase Withdrawal rate See table footnote (2) below. Mortality rate 0 % 16 % Decrease Net modified coinsurance payable 150 Fair values are determined using the same unobservable inputs as insurance liabilities. Table of Contents Fortitude Life Insurance & Annuity Company 76
Excluded from the above chart are certain level 3 assets that were valued by an external vendor and for which the unobservable inputs were not readily available. As of December 31, 2025, investments totaling $108 million and $40 million were excluded from the Retained business and Ceded business, respectively, under this criteria.. Also excluded from the above chart was $243 million of funds withheld payable to affiliates, related to the Ceded business, that are classified as level 3 for which the unobservable inputs were not readily available. December 31, 2024 Fair Value Valuation Techniques Unobservable Inputs Minimum Maximum Weighted Average Impact of Increase in Input on Fair Value (1) (in millions) Assets: Retained business Fixed maturity securities U.S. corporate private securities $ 228 Discounted cash flow Discount rate 4.96 % 8.92 % 6.78 % Decrease Foreign corporate private securities 42 Discounted cash flow Discount rate 4.80 % 7.76 % 6.07 % Decrease Asset-backed securities 45 Discounted cash flow Discount rate 6.68 % 12.29 % 8.33 % Decrease Mortgage loans Residential mortgage loans 286 Discounted cash flow Discount rate 3.77 % 9.94 % 6.41 % Decrease Commercial mortgage loans 78 Discounted cash flow Discount rate 6.04 % 7.32 % 6.92 % Decrease Total Mortgage loans 364 Ceded business Foreign corporate private securities 4 Discounted cash flow Discount rate 12.00 % 20.00 % 13.00 % Decrease Deposit asset 364 Fair values are determined using the same unobservable inputs as insurance liabilities. Reinsurance recoverables 163 Fair values are determined using the same unobservable inputs as insurance liabilities. Liabilities: Retained business Insurance liabilities (1) $ 2,196 Discounted cash flow Equity volatility curve 16 % 26 % Increase Lapse rate 0.65 % 13 % Decrease Spread over risk free 0.46 % 2.10 % Decrease Utilization rate 87.5 % 100 % Increase Withdrawal rate See table footnote (2) below. Mortality rate 0 % 16 % Decrease Ceded business Insurance liabilities (1) $ 2,184 Discounted cash flow Equity volatility curve 16 % 26 % Increase Lapse rate 0.65 % 13 % Decrease Spread over risk free 0.50 % 0.50 % Decrease Utilization rate 87.5 % 100 % Increase Withdrawal rate See table footnote (2) below. Mortality rate 0 % 16 % Decrease Net modified coinsurance payable 145 Fair values are determined using the same unobservable inputs as insurance liabilities. Excluded from the above chart are certain level 3 assets that were valued by an external vendor and for which the unobservable inputs were not readily available. As of December 31, 2024, investments of $93 million and $12 million were excluded from the Retained business and Ceded business, respectively, under this criteria. (1) See Note 7 - Insurance liabilities for further discussion regarding the unobservable inputs noted above. (2) The withdrawal rate assumption estimates the magnitude of annual contractholder withdrawals relative to the maximum allowable amount under the contract. These assumptions vary based on the age of the contractholder, the tax status of the contract and the duration since the contractholder began lifetime withdrawals. As of December 31, 2025 and 2024, the Table of Contents Fortitude Life Insurance & Annuity Company 77
minimum withdrawal rate assumption was 83% and 84% respectively and the maximum withdrawal rate assumption may be greater than 98.5% and 100%. The fair value of the liability will generally increase the closer the withdrawal rate is to 100% and decrease as the withdrawal rate moves further away from 100%. Table of Contents Fortitude Life Insurance & Annuity Company 78
Interrelationships Between Unobservable Inputs - In addition to the sensitivities of fair value measurements to changes in each unobservable input in isolation, as reflected in the table above, interrelationships between these inputs may also exist, such that a change in one unobservable input may give rise to a change in another, or multiple, inputs. Examples of such interrelationships for significant internally-priced Level 3 assets and liabilities are as follows: Corporate Securities - The rate used to discount future cash flows reflects current risk-free rates plus credit and liquidity spread requirements that market participants would use to value an asset. The discount rate may be influenced by many factors, including market cycles, expectations of default, collateral, term and asset complexity. Each of these factors can influence discount rates, either in isolation, or in response to other factors. During weaker economic cycles, as the expectations of default increases, credit spreads widen, which results in a decrease in fair value. Insurance Liabilities, at fair value - The Company expects efficient benefit utilization and withdrawal rates to generally be correlated with lapse rates. However, behavior is highly dependent on the facts and circumstances surrounding the individual contractholder, such as their liquidity needs or tax situation, which could drive lapse behavior independent of other contractholder behavior assumptions. To the extent that more efficient contractholder behavior results in greater in-the- moneyness at the contract level, lapse rates may decline for those contracts. Similarly, to the extent that increases in equity volatility are correlated with overall declines in the capital markets, lapse rates may decline as contracts become more in-the- money. Changes in Level 3 Assets and Liabilities - The following tables describe changes in fair values of Level 3 assets and liabilities, by reportable segment, and in the aggregate. In addition, the following tables include the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held at the end of their respective periods. When a determination is made to classify assets and liabilities within Level 3, the determination is based on significance of the unobservable inputs in the overall fair value measurement. All transfers are based on changes in the observability of the valuation inputs, including the availability of pricing service information that the Company can validate. Transfers into Level 3 are generally the result of unobservable inputs utilized within valuation methodologies and the use of indicative broker quotes for assets that were previously valued using observable inputs. Transfers out of Level 3 are generally due to the use of observable inputs in valuation methodologies as well as the availability of pricing service information for certain assets that the Company can validate. Table of Contents Fortitude Life Insurance & Annuity Company 79
Year Ended December 31, 2025 Fair Value, beginning of year Total realized and unrealized gains (losses) Purchases Sales Issuances Settlements Other Transfers into Level 3 Transfers out of Level 3 Fair Value, end of year Change in unrealized gains (losses) for assets still held (1) (in millions) Retained Business Fixed maturity securities, fair value option U.S. corporate private securities $ 271 $ 6 $ - $ - $ - $ (79) $ 24 $ - $ - $ 222 $ 7 Foreign corporate private securities 64 4 - - - - - - - 68 4 Residential mortgage- backed securities 3 - - - - (3) - - - - - Asset-backed securities 70 1 10 - (10) (25) 20 - 66 2 Mortgage loans 364 (3) 85 - - (79) (4) - - 363 (3) Other invested assets - real estate owned - - - - - - 3 - - 3 - Ceded Business Fixed maturity securities, fair value option U.S. corporate private securities 1 - - - - (1) - - - - - Asset-backed securities 11 - 45 - - (11) - - - 45 - Foreign corporate private securities 4 - 7 - - (11) - - - - - Deposit asset 364 (77) - - - - - - - 287 - Reinsurance recoverables 163 (19) - - - - - - - 144 - Net modified coinsurance payable (145) (5) - - - - - - - (150) - Fixed maturity securities, available for sale U.S. corporate private securities - - 42 - - (2) - - - 40 - Asset-backed securities - - 66 - - - - - - 66 - Short-term investments - - 7 - - - - - - 7 - Mortgage loans - - 173 - - (3) - - - 170 - Funds withheld payable to affiliates - - 246 - - (3) - - - 243 - Table of Contents Fortitude Life Insurance & Annuity Company 80
Year Ended December 31, 2024 Fair Value, beginning of period Total realized and unrealized gains (losses) Purchases Sales Issuances Settlements Other Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Change in unrealized gains (losses) for assets still held (1) (in millions) Retained Business Fixed maturity securities U.S. corporate private securities $ 244 $ - $ 25 $ (45) $ - $ (3) $ 50 $ - $ - $ 271 $ 5 Foreign corporate private securities 56 1 - - - - 7 - - 64 1 Residential mortgage- backed securities 5 - - - - (2) - - - 3 - Asset-backed securities 246 1 41 (153) - (7) (58) - - 70 1 Mortgage loans Residential mortgage loans 361 11 26 - - (111) (1) - - 286 11 Commercial mortgage loans 76 2 - - - - - - - 78 2 Ceded Business U.S. corporate private securities 1 - 1 - - (1) - - - 1 - Asset-backed securities - - 28 - - (7) - - (10) 11 - Foreign corporate private securities 1 - 4 - - (4) 3 - - 4 - Short-term investments 4 - 6 - - (10) - - - - - Deposit asset 438 (71) - - - - (3) - - 364 - Reinsurance recoverables 206 (43) - - - - - - - 163 - Net modified coinsurance receivable (payable) (78) (67) - - - - - - - (145) - (1) Unrealized gains or losses related to assets still held at the end of the period do not include amortization or accretion of premiums and discounts. Table of Contents Fortitude Life Insurance & Annuity Company 81
Year Ended December 31, 2025 Expected benefits Fair Value, beginning of year Reduction in estimates of expected benefits Increase in estimates of expected benefits Change in fair value (discount rate) Fee income and paid losses Other Fair Value, end of year (in millions) Insurance liabilities Retained Business $ 2,196 $ (979) $ 659 $ 65 $ 192 $ - $ 2,133 Ceded Business 2,184 (372) 332 35 37 - 2,216 Total Insurance liabilities $ 4,380 $ (1,351) $ 991 $ 100 $ 229 $ - $ 4,349 Year Ended December 31, 2024 Expected benefits Fair Value, beginning of year Reduction in estimates of expected benefits Increase in estimates of expected benefits Change in fair value (discount rate) Fee income and paid losses Other Fair Value, end of year (in millions) Insurance liabilities Retained Business $ 2,835 $ (864) $ 511 $ (450) $ 164 $ - $ 2,196 Ceded Business 2,168 (269) 324 (48) 9 - 2,184 Total Insurance liabilities $ 5,003 $ (1,133) $ 835 $ (498) $ 173 $ - $ 4,380 "Total realized and unrealized gains (losses)" related to our level 3 assets are included in earnings in Investment gains (losses). Activity within our level 3 liabilities is primarily recognized in earnings within Policyholder benefits and changes in fair value of insurance liabilities. However, the changes related to the Company's own-credit risk, included in "Change in fair value (discount rate)" above, is recorded in other comprehensive income (loss). Additionally, as noted in the following section, there are other components of the change in fair value that are recognized separately in the consolidated statements of operations. Change in Fair Value of Insurance Contracts The components of the change in fair value of our insurance contracts are reported in several line items within Revenues and Benefits and expenses in our consolidated statements of operations and comprehensive income (loss). The revenue items include Premiums, Policy charges and fee income, and Asset management and service fees. The Benefits and expenses items include Policyholders' benefits and changes in fair value of insurance liabilities and Commission expense. Policyholder benefits and changes in fair value of insurance liabilities includes the following changes in fair value of the assets and liabilities related to the insurance contracts for which we have elected the fair value option: December 31, 2025 December 31, 2024 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) Assets: Reinsurance recoverables $ - $ (19) $ (19) $ - $ (43) $ (43) Modified coinsurance receivable - 143 143 - 87 87 Deposit asset - (77) (77) - (74) (74) Liabilities: Insurance liabilities $ (63) $ 32 $ (31) $ (639) $ 16 $ (623) Changes in insurance liabilities attributable to the Company's own-credit risk are recorded in other comprehensive income (loss). Changes in the modified coinsurance payable are reported in Policyholder benefits and changes in fair value of insurance liabilities, however, they are not included in the above chart as they relate to the investment portfolio within the modified coinsurance agreement. Table of Contents Fortitude Life Insurance & Annuity Company 82
Fair Value of Financial Instruments The table below presents the carrying amount and fair value by fair value hierarchy level of certain financial instruments that are not reported at fair value. The financial instruments presented below are reported at carrying value on the Company's Consolidated Statements of Financial Position. In some cases the carrying amount equals or approximates fair value. December 31, 2025 Fair Value Carrying Amount Level 1 Level 2 Level 3 Total Total (in millions) Assets: Accrued investment income $ - $ 63 $ - $ 63 $ 63 Reinsurance recoverable on policyholder contract deposits associated with investment-type contracts - - 471 471 463 Other invested assets - Other 22 - 11 33 33 Liabilities: Policyholder contract deposits associated with investment-type contracts - - 545 545 535 Liabilities associated with secured borrowing arrangements Repurchase agreements $ - $ 1,184 $ - $ 1,184 $ 1,180 Securities lending transactions - 3 - 3 3 December 31, 2024 Fair Value Carrying Amount Level 1 Level 2 Level 3 Total Total (in millions) Assets: Accrued investment income $ - $ 58 $ - $ 58 $ 58 Other invested assets - Other 26 - 11 37 37 Liabilities: Liabilities associated with secured borrowing arrangements Repurchase agreements $ - $ 1,220 $ - $ 1,220 $ 1,200 The fair values presented above have been determined by using available market information and by applying market valuation methodologies, as described in more detail below. Accrued investment income - The Company believes that due to the short-term nature of these assets, the carrying value approximates fair value. Reinsurance recoverable on policyholder contract deposits associated with investment-type contracts - Fair value is estimated using the same valuation procedures as the underlying policyholder contract deposits associated with investment-type contracts, as described below. Other invested assets - Other - Includes policy loans and cash collateral pledged in excess of derivative liabilities. For policy loans, which are classified within Level 3, carrying value generally approximates fair value. For cash collateral pledged in excess of derivative liabilities, which is classified as Level 1, the carrying value approximates fair value due to the short-term nature of these transactions. Policyholder contract deposits associated with investment-type contracts - The fair value of policyholder contract deposits associated with investment-type contracts is estimated using discounted cash flow calculations based on interest rates currently Table of Contents Fortitude Life Insurance & Annuity Company 83
being offered in the industry for similar contracts with maturities consistent with those of the contracts being valued. When no similar contracts are being offered, the discount rate is the U.S. Treasury spot rate or current risk-free interest rate. Other factors considered in the estimation process include current policyholder account values and related surrender charges, expectations about policyholder behavior and risk margin adjustments. Liabilities associated with secured borrowing arrangements - Fair values for liabilities associated with repurchase agreements that have a maturity date greater than one year are determined using discounted cash flow analyses and incorporate interest rates associated with the repurchase agreement. The carrying amount of liabilities associated with securities lending transactions and repurchase agreements with a maturity date of one year or less approximates fair value due to the short-term nature of these transactions. 5. INVESTMENTS Other Invested Assets The following table sets forth the composition of "Other invested assets," as of the dates indicated. December 31, 2025 2024 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) LPs/LLCs: Equity method: Private equity $ - $ 1 $ 1 $ - $ 1 $ 1 Real estate-related - 3 3 - 3 3 Subtotal equity method - 4 4 - 4 4 Fair value: Private equity 28 - 28 27 - 27 Total LPs/LLCs 28 4 32 27 4 31 Derivative instruments 12 471 483 14 313 327 Other 36 - 36 37 - 37 Total other invested assets $ 76 $ 475 $ 551 $ 78 $ 317 $ 395 Table of Contents Fortitude Life Insurance & Annuity Company 84
Accrued Investment Income The following table sets forth the composition of "Accrued investment income," as of the dates indicated: December 31, 2025 2024 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) Fixed maturity securities, fair value option $ 43 $ 11 $ 54 $ 43 $ 12 $ 55 Fixed maturity securities, available for sale - 2 2 - - - Mortgage loans 5 - 5 1 - 1 Short-term investments and cash equivalents 2 - 2 2 - 2 Total accrued investment income $ 50 $ 13 $ 63 $ 46 $ 12 $ 58 The aggregate fair value of mortgage loans that were 90 days or more past due and in non-accrual status were $4 million and $3 million as of December 31, 2025 and 2024, respectively. The aggregate unpaid principal balance for these loans approximated fair value as of both December 31, 2025 and 2024. There were no write-downs on accrued investment income for the years ended December 31, 2025 and 2024. Net Investment Income The following table sets forth "Net investment income" by investment type, for the periods indicated: Year Ended December 31 2025 2024 2023 Retained Business Ceded Business Total Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) Fixed maturity securities, fair value option $ 214 $ 58 $ 272 $ 238 $ 56 $ 294 $ 221 $ 51 $ 272 Fixed maturity securities, available for sale - 2 2 - - - - - - Equity securities - - - - - - - 5 5 Mortgage loans 26 1 27 29 - 29 23 - 23 Other invested assets 1 - 1 6 (1) 5 27 2 29 Short-term investments and cash equivalents 44 8 52 31 7 38 22 20 42 Income ceded via funds withheld payable - (4) (4) - - - - - - Gross investment income $ 285 $ 65 $ 350 $ 304 $ 62 $ 366 $ 293 $ 78 $ 371 Less: investment expenses (1) (73) - (73) (74) - (74) (53) (3) (56) Net investment income $ 212 $ 65 $ 277 $ 230 $ 62 $ 292 $ 240 $ 75 $ 315 (1) For the years ended December 31, 2025, 2024, and 2023 investment expenses within the Retained Business includes $62 million, $68 million, and $33 million respectively, of expense related to liabilities associated with repurchase agreements. The activity included in the above charts include interest income on investments for which we have elected the fair value option, where applicable. Table of Contents Fortitude Life Insurance & Annuity Company 85
Investment Gains (Losses), Net The following tables set forth "Investment gains (losses), net" by investment type, for the periods indicated: Year Ended December 31, 2025 Retained Business Ceded Business Total Business Unrealized Realized Total Unrealized Realized Total Unrealized Realized Total (in millions) Fixed maturity securities, fair value option $ 114 $ (66) $ 48 $ 27 $ (1) $ 26 $ 141 $ (67) $ 74 Mortgage loans (3) - (3) - - - (3) - (3) Derivatives - (443) (443) - 158 158 - (285) (285) Total $ 111 $ (509) $ (398) $ 27 $ 157 $ 184 $ 138 $ (352) $ (214) Year Ended December 31, 2024 Retained Business Ceded Business Total Business Unrealize d Realized Total Unrealized Realized Total Unrealized Realized Total (in millions) Fixed maturity securities, fair value option $ (177) $ - $ (177) $ 1 $ - $ 1 $ (176) $ - $ (176) Mortgage loans 11 - 11 - - - 11 - 11 Derivatives - (742) (742) - 219 219 - (523) (523) Total $ (166) $ (742) $ (908) $ 1 $ 219 $ 220 $ (165) $ (523) $ (688) Year Ended December 31, 2023 Retained Business Ceded Business Total Business Unrealized Realized Total Unrealized Realized Total Unrealized Realized Total (in millions) Fixed maturity securities, fair value option $ 160 $ (35) $ 125 $ 41 $ (22) $ 19 $ 201 $ (57) $ 144 Equity securities - - - 5 - 5 5 - 5 Mortgage loans 2 - 2 - - - 2 - 2 Derivatives - (750) (750) - 289 289 - (461) (461) Total $ 162 $ (785) $ (623) $ 46 $ 267 $ 313 $ 208 $ (518) $ (310) Repurchase Agreements and Securities Lending Transactions In the normal course of business, FLIAC sells securities under agreements to repurchase and enters into securities lending transactions. These balances are recorded within "Liabilities associated with secured borrowing arrangements" in the consolidated statements of financial position. Repurchase Agreements The following table sets forth, by type, the securities that we have agreed to repurchase, all of which are contained in the Retained Business. The below amounts represent the remaining contractual maturities of our repurchase agreements for the periods indicated. December 31, 2025 2024 Up to 30 days 30-90 days Greater than 90 days Total Up to 30 days 30-90 days Greater than 90 days Total U.S. corporate public securities $ 380 $ 298 $ 502 $ 1,180 $ 203 $ 495 $ 502 $ 1,200 Table of Contents Fortitude Life Insurance & Annuity Company 86
The market value of the securities posted as collateral under the repurchase agreements was $1,217 million and $1,224 million as of December 31, 2025 and 2024, respectively. During the years ended December 31, 2025 and 2024, the Company received (returned) a net $17 million and $(62) million, respectively, of fixed maturity securities to/from counterparties, on a non-cash basis, related to collateral for liabilities associated with repurchase agreements contained within the Retained Business. Securities Lending Transactions As of December 31, 2025 there were $3 million of liabilities associated with securities lending transactions, all of which are included in the Ceded Business. The remaining contractual maturity of these liabilities are considered "overnight and continuous". The market value of the foreign corporate public debt securities that were loaned under these transactions was $3 million. There were no outstanding securities lending agreements as of December 31, 2024. Fixed Maturity Securities, Available For Sale As of December 31, 2025, gross unrealized losses and the allowance for credit losses were both less than $1 million on available-for-sale fixed maturity securities. There were no gross unrealized gains on available-for-sale fixed maturity securities as of December 31, 2025. The following table presents the amortized cost and fair value of fixed maturity securities available for sale by contractual maturity: December 31, 2025 Amortized Cost Fair Value (in millions) Due after one year through five years $ 5 $ 5 Due after five years through ten years 21 21 Due after ten years 23 23 Mortgage-backed, asset-backed and collateralized 198 198 Total $ 247 $ 247 Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Mortgage-backed, asset-backed and collateralized securities are shown separately in the table above, as they do not have a single maturity date. For the year ended December 31, 2025, proceeds from sales and maturities related to available-for-sale fixed maturity securities were $2 million each. 6. DERIVATIVES, HEDGING, AND OFFSETTING Types of Derivative Instruments and Derivative Strategies The Company utilizes various derivative instruments and strategies to manage its risk. Commonly used derivative instruments include but are not necessarily limited to: • Interest rate contracts: swaps, swaptions, futures, forwards, options, caps, floors, and treasury bond total return swaps • Equity contracts: futures, options, and total return swaps • Foreign exchange contracts: futures, options, forwards and swaps See below for information on these contracts and the related strategies. Interest Rate Contracts Interest rate swaps, options, and treasury bond total return swaps are used by the Company to reduce risks from changes in interest rates, manage interest rate exposures arising from mismatches between assets and liabilities and to hedge against changes in the values of assets and liabilities it owns or anticipates acquiring or selling. Table of Contents Fortitude Life Insurance & Annuity Company 87
• Interest rate swaps may be attributed to specific assets or liabilities or to a portfolio of assets or liabilities. The Company agrees with counterparties to exchange, at specified intervals, the difference between fixed-rate and floating- rate interest amounts calculated by reference to an agreed upon notional principal amount. • Interest rate options include swaptions and interest rate floors. Swaptions are options that give the holder the right but not obligation to enter into a specified interest rate swap. The Company uses these instruments for protection against the direction of future interest rates. Interest rate floors set an effective rate of interest on underlying reference rate and is used by the Company to provide protection against potential future declines in rates. • Bond total return swaps are contracts whereby the Company agrees with counterparties to exchange, at specified intervals, the difference between the return on a bond portfolio and Secured Overnight Financing Rate ("SOFR") plus an associated funding spread based on a notional amount. The Company generally uses bond total return swaps to hedge the effect of changes in interest rates. Equity Contracts Equity options, total return swaps, and futures are used by the Company to manage its exposure to the equity markets which impacts the value of assets and liabilities it owns or anticipates acquiring or selling. • Equity options are contracts which will settle in cash based on differentials in the underlying indices at the time of exercise and the strike price. The Company uses combinations of purchases and sales of equity index options to hedge the effects of adverse changes in equity indices within a predetermined range. • Total return swaps are contracts whereby the Company agrees with counterparties to exchange, at specified intervals, the difference between the return on an equity index and Secured Overnight Financing Rate ("SOFR") plus an associated funding spread based on a notional amount. The Company generally uses equity total return swaps to hedge the effect of changes in equity indices. • In standardized exchange-traded equity futures transactions, the Company purchases or sells a specified number of contracts, the values of which are determined by the daily market values underlying referenced equity indices. The Company enters into exchange-traded futures with regulated futures commission's merchants who are members of a trading exchange. Foreign Exchange Contracts Currency derivatives, which are primarily comprised of currency swaps, are used by the Company to reduce risks from changes in currency exchange rates with respect to investments denominated in foreign currencies that the Company either holds or intends to acquire or sell. • Under currency swaps, the Company agrees with counterparties to exchange, at specified intervals, the difference between one currency and another at an exchange rate and calculated by reference to an agreed principal amount. Generally, the principal amount of each currency is exchanged at the beginning and termination of the currency swap by each party. Table of Contents Fortitude Life Insurance & Annuity Company 88
Primary Risks Managed by Derivatives The table below provides a summary, by reporting segment, of the gross notional amount and fair value of derivative contracts by the primary underlying risks. Many derivative instruments contain multiple underlying risks. The fair value amounts below represent the value of derivative contracts prior to taking into account the netting effects of master netting agreements and cash collateral. Certain prior period amounts have been reclassified to conform to the current period presentation. December 31, 2025 December 31, 2024 Gross Notional Values/Units Gross Fair Value Gross Notional Values/Units Gross Fair Value Assets Liabilities Assets Liabilities Primary Underlying Risk/Instrument Type (in millions) Retained Business Interest Rate Interest Rate Swaps $ 97,920 $ 558 $ (958) $ 40,347 $ 384 $ (822) Interest Rate Options 640 17 (72) 640 30 (54) Total Return Swaps 1,233 1 (30) 1,079 - (66) Equity Equity Futures (425) 2 (2) (799) 36 (9) Total Return Swaps 2,435 5 (38) 2,435 89 (1) Equity Options 2,693 51 (30) 3,035 87 (135) Currency/Interest Rate Foreign Currency Swaps 49 - - 46 3 - Total Derivatives, Retained Business 104,545 634 (1,130) 46,783 629 (1,087) Ceded Business Interest Rate Interest Rate Swaps 585 8 (4) 285 15 (7) Currency/Interest Rate Foreign Currency Swaps 24 1 - 33 4 - Equity Total Return Swaps 135 - (5) 250 1 - Equity Options 2,468 495 (29) 2,468 327 (27) Total Derivatives, Ceded Business 3,212 504 (38) 3,036 347 (34) Total Derivatives (1) $ 107,757 $ 1,138 $ (1,168) $ 49,819 $ 976 $ (1,121) (1) Recorded in "Other invested assets" and "Other liabilities" in the Consolidated Statements of Financial Position Table of Contents Fortitude Life Insurance & Annuity Company 89
Offsetting Assets and Liabilities The following table presents recognized derivative instruments and liabilities associated with repurchase agreements, that are offset in the Consolidated Statements of Financial Position, and/or are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in the Consolidated Statements of Financial Position. December 31, 2025 Gross Amounts of Recognized Financial Instruments Gross Amounts Offset in the Statements of Financial Position Net Amounts Presented in the Statements of Financial Position Financial Instruments/ Collateral(1) Net Amount Counterparty Netting Cash Collateral (in millions) Offsetting of Financial Assets: Derivatives Retained Business $ 634 $ (604) $ (18) $ 12 $ - $ 12 Ceded Business 504 (29) (4) 471 - 471 Total $ 1,138 $ (633) $ (22) $ 483 $ - $ 483 Offsetting of Financial Liabilities: Derivatives Retained Business $ 1,130 $ (604) $ (486) $ 40 $ (40) $ - Ceded Business 38 (29) (4) 5 - 5 Total Derivatives $ 1,168 $ (633) $ (490) $ 45 $ (40) $ 5 Repurchase agreements $ 1,180 $ - $ - $ 1,180 $ (1,180) $ - Securities lending transactions $ 3 $ - $ - $ 3 $ (3) $ - December 31, 2024 Gross Amounts of Recognized Financial Instruments Gross Amounts Offset in the Statements of Financial Position Net Amounts Presented in the Statements of Financial Position Financial Instruments/ Collateral(1) Net Amount Counterparty Netting Cash Collateral (in millions) Offsetting of Financial Assets: Derivatives Retained Business $ 629 $ (491) $ (124) $ 14 $ - $ 14 Ceded Business 347 (34) - 313 - 313 Total $ 976 $ (525) $ (124) $ 327 $ - $ 327 Offsetting of Financial Liabilities: Derivatives Retained Business $ 1,087 $ (491) $ (510) $ 86 $ (86) $ - Ceded Business 34 (34) - - - - Total $ 1,121 $ (525) $ (510) $ 86 $ (86) $ - Repurchase agreements $ 1,200 $ - $ - $ 1,200 $ (1,200) $ - (1) Amounts exclude the excess of collateral received/pledged from/to the counterparty. The Company is exposed to credit-related losses in the event of non-performance by counterparties to financial derivative transactions with a positive fair value. FLIAC manages credit risk by (i) entering into derivative transactions with highly rated major international financial institutions and other creditworthy counterparties governed by master netting agreement, as applicable; (ii) trading through central clearing and OTC parties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single-party credit exposures which are subject to periodic management review. Substantially all of the Company's derivative agreements have zero thresholds which require daily full collateralization by the party in a liability position. Table of Contents Fortitude Life Insurance & Annuity Company 90
For repurchase agreements, the Company monitors the value of the securities and maintains collateral, as appropriate, to protect against credit exposure. Where the Company has entered into repurchase agreements with the same counterparty, in the event of default, the Company would generally be permitted to exercise right of offset. Classification of Derivatives Activity The Company does not designate any of its derivatives as instruments that qualify for hedge accounting treatment. Accordingly, all realized and unrealized changes in the fair value of derivatives are recorded in current earnings within either "Investment gains (losses), net" or "Other income" on the consolidated statements of operations. The following tables provide the financial statement classification and impact of derivatives, by segment. Certain prior period amounts have been reclassified to conform to the current period presentation. Year Ended December 31 2025 2024 2023 Investment gains (losses), net Other income Total Investment gains (losses), net Other income Total Investment gains (losses), net Other income Total (in millions) Retained Business Interest Rate $ (24) $ - $ (24) $ (278) $ - $ (278) $ (147) $ - $ (147) Currency/Interest Rate - (7) (7) - 9 9 - (5) (5) Credit - - - 3 - 3 5 - 5 Equity (419) - (419) (467) - (467) (608) - (608) Total, Retained Business (443) (7) (450) (742) 9 (733) (750) (5) (755) Ceded Business Interest Rate - - - 3 - 3 67 - 67 Currency/Interest Rate (2) - (2) 2 - 2 (2) - (2) Credit - - - - - - 3 - 3 Equity 160 - 160 214 - 214 221 - 221 Total, Ceded Business 158 - 158 219 - 219 289 - 289 Total $ (285) $ (7) $ (292) $ (523) $ 9 $ (514) $ (461) $ (5) $ (466) Table of Contents Fortitude Life Insurance & Annuity Company 91
7. INSURANCE LIABILITIES Insurance Liabilities at Fair Value Retained Business insurance liabilities associated with insurance contracts for which the fair value option has been elected are primarily comprised of variable annuity contracts that include guaranteed benefits, including GMAB, GMWB, GMDB, and GMIWB. Also included in the Retained Business are smaller blocks of variable universal life and fixed payout annuity products for which we have also elected the fair value option. Ceded Business insurance liabilities associated with insurance contracts for which we have elected the fair value option are primarily comprised of registered index-linked annuities and fixed annuities, which includes both fixed indexed and fixed deferred annuities, and certain other variable annuities. The remainder of our insurance contracts for which we have elected the fair value option are comprised of individual annuities and supplementary contracts with life contingencies and are included in both of our segments. The following represents the major components of our insurance liabilities, by segment: December 31, 2025 2024 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) Insurance Liabilities Variable annuity contracts with guaranteed benefits $ 1,849 $ 143 $ 1,992 $ 1,913 $ 177 $ 2,090 Registered index-linked and Fixed annuity contracts - 2,042 2,042 - 1,977 1,977 Other insurance contracts 284 31 315 283 30 313 Total Insurance Liabilities $ 2,133 $ 2,216 $ 4,349 $ 2,196 $ 2,184 $ 4,380 Variable Annuity Contracts with Guaranteed Benefits Description of Guaranteed Benefits The GMAB features provide the contractholder with a guaranteed return of initial account value or an enhanced value if applicable. The most significant of the Company's GMAB features are the guaranteed return option features, which includes an automatic rebalancing element that reduces the Company's exposure to these guarantees. The GMDB features provide certain guaranteed benefits in the event of the death of the contractholder. The GMWB features provide the contractholder with access to a guaranteed remaining balance if the account value is reduced to zero through a combination of market declines and withdrawals. The guaranteed remaining balance is generally equal to the protected value under the contract, which is initially established as the greater of the account value or cumulative deposits when withdrawals commence, less cumulative withdrawals. The contractholder also has the option, after a specified time period, to reset the guaranteed remaining balance to the then-current account value, if greater. The contractholder accesses the guaranteed remaining balance through payments over time, subject to maximum annual limits. The GMIWB features, taken collectively, provide a contractholder two optional methods to receive guaranteed minimum payments over time, a "withdrawal" option or an "income" option. The withdrawal option guarantees that a contractholder can withdraw an amount each year until the cumulative withdrawals reach a total guaranteed balance. The income option (which varies among the Company's GMIWBs) in general guarantees the contractholder the ability to withdraw an amount each year for life (or for joint lives, in the case of any spousal version of the benefit) where such amount is equal to a percentage of a protected value under the benefit. The contractholder also has the potential to increase this annual amount, based on certain subsequent increases in account value that may occur. The GMIWB can be elected by the contractholder at any time following contract issue prior to annuitization. Certain GMIWB features include an automatic rebalancing element that reduces the Company's exposure to these guarantees. Table of Contents Fortitude Life Insurance & Annuity Company 92
Fair Value Estimations of Insurance Liabilities The fair values of insurance liabilities associated with variable annuity contracts with guaranteed benefits are calculated as the present value of future expected benefit payments to customers, anticipated future trail commissions paid to agents and certain administrative expenses less the present value of future expected rider fees, mortality and expense charges, contract charges and the anticipated future reimbursement of certain asset management fees. Since there is no observable active market for the transfer of these obligations, the valuations are calculated using internally developed models with option pricing techniques. The models are based on a risk neutral valuation framework and incorporate premiums for risks inherent in valuation techniques, inputs, and the general uncertainty around the timing and amount of future cash flows. The determination of these risk premiums requires the use of management's judgment. In the third quarter of both 2025 and 2024, the Company completed its annual review of actuarial assumptions related to its fair value of insurance liabilities. Based on those reviews, the Company updated certain assumptions associated with its variable annuity contracts with guaranteed benefits in each period, which resulted in an increase (decrease) in its fair value of insurance liabilities of $11 million and $(3) million during the third quarters of 2025 and 2024, respectively. The impact of the respective assumption updates on the Consolidated Statement of Operations was included within "Policyholder benefits and changes in fair value of insurance liabilities". The significant inputs to the valuation models include capital market assumptions, such as interest rate levels and volatility assumptions, as well as actuarially-determined assumptions, including contractholder behavior, such as lapse rates, benefit utilization rates, withdrawal rates, and mortality rates. Further information regarding these assumptions are below. See also Note 4 for further quantitative information regarding these assumptions. Capital market assumptions • Interest rate assumptions - The spread over the risk-free rate swap curve represents the premium added to the proxy for the risk-free rate to reflect the Company's estimates of rates that a market participant would use to value the living benefits in both the accumulation and payout phases and index-linked interest crediting guarantees. This spread includes an estimate of NPR, which is the risk that the obligation will not be fulfilled by the Company. NPR is primarily estimated by utilizing the credit spreads associated with issuing funding agreements, adjusted for any illiquidity risk premium. In order to reflect the financial strength ratings of the Company, credit spreads associated with funding agreements, as opposed to credit spread associated with debt, are utilized in developing this estimate because funding agreements, living benefit guarantees, and index-linked interest crediting guarantees are insurance liabilities and are therefore senior to debt. • Equity volatility curve - The equity volatility curve assumption is based on 1 and 2 year index-specific at-the-money implied volatilities grading to 10 year total variance. Increased volatility increases the fair value of the liability. • Equity correlation - The model generates stochastic equity returns based on the inputted equity correlation. The assumption is based on historic 20 years of weekly index return data. Actuarially-determined assumptions • Lapse rates - Lapse rates for contracts with living benefit guarantees are adjusted at the contract level based on the in-the-moneyness of the living benefit and reflect other factors, such as the applicability of any surrender charges. Lapse rates are reduced when contracts are more in-the-money. Lapse rates for contracts with index-linked crediting guarantees may be adjusted at the contract level based on the applicability of any surrender charges, product type, and market related factors such as interest rates. Lapse rates are also generally assumed to be lower for the period where surrender charges apply. • Utilization rates - The utilization rate assumption estimates the percentage of contracts that will utilize the benefit during the contract duration and begin lifetime withdrawals at various time intervals from contract inception. Utilization assumptions may vary by product type, tax status and age. The impact of changes in these assumptions is highly dependent on the product type, the age of the contractholder at the time of the sale, and the timing of the first lifetime income withdrawal. Table of Contents Fortitude Life Insurance & Annuity Company 93
• Withdrawal rates - The withdrawal rate assumption estimates the magnitude of annual contractholder withdrawals relative to the maximum allowable amount under the contract. These assumptions vary based on the age of the contractholder, the tax status of the contract and the duration since the contractholder began lifetime withdrawals. • Mortality rates - Mortality rates may vary by product, age, and duration with a vast majority of policyholders with living benefits aged from 45 to 90 years old. A mortality improvement assumption is also incorporated into the overall mortality table. While the majority of living benefits have a minimum age requirement, certain other contracts do not have an age restriction. This results in contractholders with mortality rates approaching 0% for certain benefits. Policyholder Contract Deposits December 31, 2025 Funding Agreements Deferred Annuities Total (in millions) Balance, beginning of year $ - $ - $ - Issuances (funds collected from new business) 498 32 530 Interest credited 5 - 5 Balance, end of year $ 503 $ 32 $ 535 Less: Reinsurance recoverable 431 32 463 Balance, end of year, net of reinsurance recoverable $ 72 $ - $ 72 Weighted-average crediting rate 4.63 % 4.31 % Cash surrender value N/A $ 29 December 31, 2025 Range of Guaranteed Minimum Crediting Rates At Guaranteed Minimum Crediting Rate 1 bp-50 bps above Guaranteed Minimum Crediting Rate 51 bps-150 bps Above Guaranteed Minimum Crediting Rate More than 150 bps Above Guaranteed Minimum Crediting Rate Total (in millions) Funding Agreements Greater than 4.00% $ 503 $ - $ - $ - $ 503 Total $ 503 $ - $ - $ - $ 503 Deferred Annuities Less than 1.99% $ - $ - $ - $ 32 $ 32 Total $ - $ - $ - $ 32 $ 32 Table of Contents Fortitude Life Insurance & Annuity Company 94
8. REINSURANCE Reinsurance is used as part of the Company's risk management and capital management strategies. Under ceded reinsurance, we remain liable to the underlying policyholder if a third-party reinsurer is unable to meet its obligations. We evaluate the financial condition of reinsurers, monitor the concentration of counterparty risk and maintain collateral, as appropriate, to mitigate this exposure. New Reinsurance Transactions In October 2025, FLIAC entered into a reinsurance agreement to cede, on a modified coinsurance basis, at least 85% of its funding agreement liabilities associated with the FABN program to a Bermuda-domiciled affiliate of the Company. The agreement was effective October 6, 2025 and includes funding agreements issued beginning on the effective date. In October 2025, FLIAC entered into a reinsurance agreement with an unaffiliated subsidiary of a U.S. based life insurance company to assume, on a coinsurance basis, a portion of new fixed annuity liabilities, of which 100% of the assumed business was immediately retroceded, on a modified coinsurance basis, to a Bermuda-domiciled affiliate of the Company. The agreement was effective October 6, 2025 and includes new policies beginning on the effective date. Novation of Ceded Business In 2022, in accordance with applicable state law, a program was instituted to novate a significant portion of the Ceded Business policies from FLIAC to Pruco Life. The program did not have an impact on total equity or net income but has resulted in the reduction of certain activity/balances associated with these policies. During the year ended December 31, 2023, approximately $641 million of account value, which generally approximates fair values of insurance liabilities, was transferred out of the Company as a result of the novation program. There was no significant novation activity during 2025 and 2024 and we do not expect significant future novation activity under the program. Since the acquisition of the Company in April 2022, approximately 73 percent of account value in the Ceded Business has been novated to Pruco Life under this program. Table of Contents Fortitude Life Insurance & Annuity Company 95
Reinsurance amounts included in the consolidated statements of operations and comprehensive income (loss) for the Company were as follows: Year Ended December 31 2025 2024 2023 (in millions) Premiums: Direct $ 35 $ 38 $ 31 Ceded (4) (3) (4) Net premiums $ 31 $ 35 $ 27 Policy charges and fee income: Direct $ 457 $ 490 $ 495 Ceded (36) (38) (39) Net policy charges and fee income $ 421 $ 452 $ 456 Asset management and service fees Direct $ 87 $ 93 $ 91 Ceded - - - Net asset management and service fees $ 87 $ 93 $ 91 Interest credited to policyholders' account balances Direct $ 6 $ - $ - Ceded (5) - $ - Net interest credited $ 1 $ - $ - Policyholders benefits and changes in fair value of insurance liabilities Direct $ 360 $ 364 $ 343 Ceded (110) (94) (58) Net policyholders benefits $ 250 $ 270 $ 285 Changes in fair value of insurance liabilities 90 (353) 55 Net policyholders benefits and changes in fair value of insurance liabilities $ 340 $ (83) $ 340 Table of Contents Fortitude Life Insurance & Annuity Company 96
Reinsurance amounts included in the consolidated statements of financial position are as follows: December 31, 2025 Registered Index- linked Annuities New York Variable Annuities Fixed Annuities (1) Funding Agreements Single Premium Immediate Annuities Total (in millions) ASSETS Total investments $ 1,802 $ 33 $ 33 $ 391 $ - $ 2,259 Cash and cash equivalents 119 - - 154 - 273 Accrued investment income 11 - 1 1 - 13 Reinsurance recoverables - 113 32 431 31 607 Deposit asset - - 287 - - 287 Other assets 1 - - - - 1 Separate account assets 42 1,949 - - - 1,991 TOTAL ASSETS $ 1,975 $ 2,095 $ 353 $ 977 $ 31 $ 5,431 LIABILITIES Insurance liabilities $ 1,756 $ 142 $ 287 $ - $ 31 $ 2,216 Policyholder contract deposits - - 32 503 - 535 Funds withheld payable to affiliates - - 34 461 - 495 Net modified coinsurance payable 146 4 - - - 150 Liabilities associated with secured borrowing arrangements 3 - - - - 3 Other liabilities 28 - - 13 - 41 Separate account liabilities 42 ` 1,949 - - - 1,991 TOTAL LIABILITIES $ 1,975 $ 2,095 $ 353 $ 977 $ 31 $ 5,431 December 31, 2024 Registered Index- linked Annuities New York Variable Annuities Fixed Annuities (1) Single Premium Immediate Annuities Total (in millions) ASSETS Total investments $ 1,682 $ 45 $ - $ - $ 1,727 Cash and cash equivalents 65 - - - 65 Accrued investment income 12 - - - 12 Reinsurance recoverables - 133 - 30 163 Deposit asset - - 364 - 364 Separate account assets 35 1,980 - - 2,015 TOTAL ASSETS $ 1,794 $ 2,158 $ 364 $ 30 $ 4,346 LIABILITIES Insurance liabilities $ 1,613 $ 177 $ 364 $ 30 $ 2,184 Other liabilities 2 - - - 2 Net modified coinsurance payable 144 1 - - 145 Separate account liabilities 35 1,980 - - 2,015 TOTAL LIABILITIES $ 1,794 $ 2,158 $ 364 $ 30 $ 4,346 (1) Includes fixed-indexed and fixed deferred annuities. Table of Contents Fortitude Life Insurance & Annuity Company 97
Included in the registered index-linked annuities and the New York variable annuities products is a modified coinsurance payable of $1,905 million and $1,757 million as of December 31, 2025 and 2024, respectively, which is equal to the assets held in the modified coinsurance portfolio and is included in the net modified coinsurance receivable/payable. 9. INCOME TAXES Tax Law Changes In July 2025, H.R.1, known as the "One Big Beautiful Bill Act" was signed into law. H.R.1 includes a broad range of tax reform provisions that impact businesses across numerous sectors of the U.S. economy. We evaluated the impact of H.R.1 on the Company and determined there is no material impact on its financial position or results of operations for the year ended December 31, 2025. In August 2022, the U.S. enacted The Inflation Reduction Act of 2022, which provides among other provisions a new corporate alternative minimum tax ("CAMT"). The CAMT is effective for taxable years beginning after December 31, 2022 and generally applies to taxpayers with average annual financial statement income exceeding $1 billion over a three-year period. The Company determined that there were no material impacts with respect to CAMT for the years ended December 31, 2025, 2024, and 2023. Effective Tax Rate The following schedule discloses significant components of Income tax expense (benefit): Year Ended December 31, 2025 2024 2023 (in millions) Income (loss) from operations before income taxes U.S. federal $ 106 $ 104 $ (10) Total income (loss) from operations before income taxes $ 106 $ 104 $ (10) Income tax expense (benefit) from operations Current tax expense (benefit): U.S. federal $ 4 $ 5 $ (14) State and local 1 1 - Total current tax expense (benefit) 5 6 (14) Deferred tax expense (benefit): U.S. federal 7 26 8 Total deferred tax expense (benefit) 7 26 8 Total income tax expense (benefit) U.S. federal 11 31 (6) State and local 1 1 - Total income tax expense (benefit) $ 12 $ 32 $ (6) Table of Contents Fortitude Life Insurance & Annuity Company 98
Reconciliation of Expected Tax at Statutory Rates to Reported Income Tax Expense (Benefit) The difference between income taxes expected at the U.S. federal statutory income tax rate of 21% and the reported income tax expense (benefit) are summarized as follows: Year Ended December 31, 2025 2024 2023 Amount Percent Amount Percent Amount Percent (in millions) (in millions) (in millions) Income (loss) from operations before income taxes $ 106 $ 104 $ (10) Tax provision at the U.S. federal statutory rate 22 21.0 % 22 21.0 % (2) 21.0 % U.S federal income taxes Change in valuation allowance 2 1.6 % 14 13.3 % (1) 6.2 % Non-taxable or non-deductible items Goodwill impairment - - % - 20 (198.4) % Investment income (1) (6) (5.9) % (8) (8.0) % (7) 76.1 % Foreign taxes - - % - (3) 26.0 % Transfer pricing adjustment (5) (4.5) % (2) (1.6) % (6) 59.1 % Other Prior year true-up (1) (0.6) % 3 2.6 % (6) 65.0 % Deferred tax adjustment (1) (0.7) % 2 2.0 % (1) 9.1 % State income taxes, net of federal income tax benefit (2) 1 0.4 % 1 1.3 % - - % Total reported income tax expense (benefit) $ 12 11.3 % $ 32 30.6 % $ (6) 64.1 % (1) Primarily related to the impact of non-taxable investment income associated with the Dividends Received Deduction ("DRD"). (2) During the year ended December 31, 2025, state and local taxes in New Jersey comprised greater than 50% of the tax effect in this category. Income Taxes Paid The Company made income tax payments of $4 million, $13 million, and $4 million for the years ended December 31, 2025, 2024, and 2023, respectively, which were fully attributable to U.S federal income taxes. Table of Contents Fortitude Life Insurance & Annuity Company 99
Schedule of Deferred Tax Assets and Deferred Tax Liabilities As of December 31, 2025 2024 (in millions) Deferred tax assets: Net operating loss $ 105 $ 107 Investments 61 87 Intangibles 49 54 Capital loss carryforwards 48 35 Change in insurance liabilities - OCR component 34 13 Other 3 2 Total deferred tax assets 300 298 Deferred tax liabilities: Insurance reserves (176) (189) Net deferred tax asset before valuation allowance $ 124 $ 109 Valuation allowance (52) (50) Net deferred tax asset $ 72 $ 59 Net current income tax receivable 15 $ 17 Income taxes (1) $ 87 $ 76 (1) Income taxes are presented net of current income tax payable of $4 million as of December 31, 2025, which is included in "Other Liabilities" on the consolidated statements of financial position. No current income tax payable was included in "Other Liabilities" as of December 31, 2024. Valuation Allowance on Deferred Tax Assets The evaluation of the recoverability of our deferred tax asset and the need for a valuation allowance requires us to weigh all positive and negative evidence to reach a conclusion that it is more likely than not that all or some portion of the deferred tax asset will not be realized. The weight given to the evidence is commensurate with the extent to which it can be objectively verified. The more negative evidence that exists, the more positive evidence is necessary and the more difficult it is to support a conclusion that a valuation allowance is not needed. In evaluating the need for a valuation allowance, the Company considers many factors, including: (1) the nature of the deferred tax assets and liabilities; (2) whether they are ordinary or capital; (3) the timing of their reversal; (4) taxable income in prior carryback years; (5) projected taxable earnings exclusive of reversing temporary differences and carryforwards; (6) the length of time that carryovers can be utilized; (7) any unique tax rules that would impact the utilization of the deferred tax assets; and (8) any tax planning strategies that the Company would employ to avoid a tax benefit from expiring unused. Although realization is not assured, management believes it is more likely than not that the deferred tax assets, net of valuation allowances, will be realized. As of December 31, 2025 and 2024, the Company held a valuation allowance of $52 million and $50 million, respectively, regarding realized and unrealized capital losses on our fixed maturity securities portfolio. A portion of the deferred tax asset relates to unrealized capital losses for which the carryforward period has not yet begun, and as such, when assessing its recoverability, we consider our ability and intent to hold the underlying securities to recovery. The amount of the deferred tax asset considered realizable may be adjusted if projections of future taxable income, including the character of that taxable Table of Contents Fortitude Life Insurance & Annuity Company 100
income during the requisite carryforward period, are updated or if objective negative evidence exists that outweighs the positive evidence. The increase in the valuation allowance is primarily due to increased capital losses on our fixed maturity securities portfolio. Loss Carryforwards The Company has capital loss carryforwards of $228 million as of December 31, 2025. Capital losses are being carried forward for five years and utilized against any future capital gains generated during that period. The capital loss carryforwards begin to expire in 2027. The Company has net operating loss carryforwards of $499 million as of December 31, 2025. The net operating loss will be carried forward indefinitely. Tax Audits and Unrecognized Tax Benefits The Company filed tax returns for the years ended December 31, 2024 and 2023 and for the period beginning the day after the acquisition of the Company by FGH, which occurred on April 1, 2022. These tax years remain open and subject to examination. Pursuant to the acquisition agreement, any tax examinations and resulting tax liability during the period prior to acquisition will be the sole responsibility of the previous parent, Prudential Annuities, Inc. We periodically evaluate uncertain tax positions to determine whether the tax positions are more likely than not to be realized as a tax benefit or expense in the current year. We also recognize interest and penalties related to uncertain tax benefits in U.S. Federal income tax expense. As of December 31, 2025 and 2024, there were no uncertain tax positions and no accruals for interest and penalties. The Company does not anticipate any significant changes within the next twelve months to its total unrecognized tax benefits related to tax years for which the statute of limitations has not expired. 10. EQUITY Dividends to Parent During 2025, an extraordinary dividend of $50 million to FGH was approved by both the Company's board of directors and the Arizona DIFI and was paid in cash during the fourth quarter of 2025. During the first quarter of 2024, a $150 million dividend was approved by the Company's board of directors, $75 million of which was considered an ordinary dividend and not subject to approval by the Arizona Department of Insurance and Financial Institutions ("DIFI") prior to payment. The other $75 million was conditioned upon the Company receiving written approval from the Arizona DIFI prior to payment. In the second quarter of 2024, the Company received written approval from the Arizona DIFI and the entire $150 million dividend was distributed in cash to FGH. During the third quarter of 2024, a $150 million extraordinary dividend was approved by the Company's board of directors, which was conditioned upon the Company receiving written approval from the Arizona DIFI prior to payment. In the fourth quarter of 2024, the Company received written approval from the Arizona DIFI and the entire $150 million dividend was distributed in cash to FGH. Distribution to Parent During 2023, the Company made a $45 million distribution to its parent company, FGH, as a result of updated information regarding certain tax assets related to the acquisition of FLIAC, which resulted in an offsetting reduction to "Additional paid-in capital". Accumulated Other Comprehensive Income (Loss) AOCI represents the cumulative other comprehensive income items that are reported separate from net income and detailed on the consolidated statements of operation and comprehensive income (loss). AOCI is comprised of changes in own-credit risk related to insurance liabilities under the fair value option and unrealized gains and losses related to fixed maturity securities designated as available for sale. See the consolidated statements of equity for additional information regarding this activity. Table of Contents Fortitude Life Insurance & Annuity Company 101
11. RELATED PARTY TRANSACTIONS The Company has transactions and relationships with affiliates. Although we seek to ensure that these transactions and relationships are fair and reasonable, it is possible that the terms of these transactions are not the same as those that would result from transactions among unrelated parties. Expense Charges and Allocations The majority of the Company's expenses are allocations or charges from FGH. These expenses primarily relate to general and administrative expenses which include accounting, actuarial, risk management, and data processing services. FGH also provides the Company with personnel and certain other services. The allocation of costs for other services are based on estimated level of usage, transactions, or time incurred in providing the respective services. During the years ended December 31, 2025, 2024 and 2023, FLIAC was allocated $36 million, $42 million, and $30 million, respectively, of costs for these services. Affiliated Investment and Advisory Activities FLIAC is affiliated with The Carlyle Group Inc. ("Carlyle"), whereby Carlyle, through an affiliated investment fund, has an equity investment in its parent, FGH. As of December 31, 2025, Carlyle's investment percentage in FGH was 38.5%. In addition, FLIAC entered into an investment management and consulting services agreement with an affiliate of Carlyle. Certain of Carlyle's affiliates also provide investment management services for FLIAC pursuant to investment management agreements. Investment management fees are charged based on a percentage of assets under management and were $4 million, $2 million, and $5 million for the years ended December 31, 2025, 2024, and 2023, respectively. These fees are recorded within net investment income in the consolidated statements of operations. As of December 31, 2025 and 2024, assets under management by Carlyle affiliates had a market value of $489 million and $490 million, respectively, and were comprised primarily of private credit fixed income securities. FLIAC recognized $30 million, $42 million, and $29 million of investment income related to these assets under management during the years ended December 31, 2025, 2024 and 2023, respectively. In connection with the investment management agreements, as of December 31, 2025 and 2024, FLIAC had unfunded commitments of $146 million and $44 million, respectively, to fund private investments where one or more Carlyle entities serves as general partner to the fund. Affiliated Asset Transfers The Company may participate in affiliated asset transfers with its parent and affiliates. Book and market value differences for trades with its parent and affiliates are recognized within "Investment gains (losses), net" on the consolidated statements of operations. The table below shows affiliated asset trades for the year ended December 31, 2025, 2024, and 2023. Affiliate Date Transaction Security Type Fair Value Book Value Net Investment Gains (Losses) (in millions) Fortitude Re Investments, LLC January 2025 Sale Fixed Maturity Securities 13 13 $ - Fortitude Reinsurance Company Ltd. December 2024 Sale Fixed Maturity Securities 197 202 (5) Fortitude Reinsurance Company Ltd. December 2024 Sale Derivatives 10 5 5 Fortitude Reinsurance Company Ltd. December 2023 Sale Limited Partnership 26 26 - Fortitude Reinsurance Company Ltd. December 2023 Sale Limited Partnership 47 47 - Fortitude Reinsurance Company Ltd. December 2023 Sale Limited Partnership 24 14 10 Fortitude Reinsurance Company Ltd. November 2023 Sale Limited Partnership 135 135 - Fortitude Reinsurance Company Ltd. November 2023 Sale Limited Partnership 56 56 - Fortitude Reinsurance Company Ltd. November 2023 Sale Limited Partnership 37 33 4 Fortitude Re Investments, LLC May 2023 Sale Limited Partnership 12 12 - Fortitude Re Investments, LLC May 2023 Sale Limited Partnership 7 7 - Table of Contents Fortitude Life Insurance & Annuity Company 102
Affiliated Reinsurance Transactions The Company reported the following balances in its consolidated statements of financial position associated with ceded affiliated reinsurance transactions. See Note 8 for further information regarding these transactions. December 31, 2025 (in millions) Assets: Reinsurance recoverable $ 463 Liabilities: Funds withheld payable $ 495 12. STATUTORY NET INCOME AND SURPLUS AND DIVIDEND RESTRICTIONS The Company is required to prepare statutory financial statements in accordance with accounting practices prescribed or permitted by the Arizona Department of Insurance and Financial Institutions ("Arizona DIFI"). Prescribed statutory accounting practices include publications of the National Association of Insurance Commissioners ("NAIC"), as well as state laws, regulations and general administrative rules. Statutory accounting practices primarily differ from U.S. GAAP by charging policy acquisition costs to expense as incurred, establishing future policy benefit liabilities using different actuarial assumptions and valuing investments, deferred taxes, and certain other assets on a different basis. In 2024, the Arizona DIFI approved a permitted accounting practice allowing the Company to admit the assets subject to certain long-term repurchase agreements with maturity dates greater than 365 days. This permitted practice was renewable annually, subject to certain conditions that have been met by the Company. In September 2025, the Company subsequently amended and restated these long-term repurchase agreements, resulting in the discontinuance of the permitted practice. Statutory Net Income and Capital and Surplus Statutory net income of the Company amounted to $173 million, $28 million, and $383 million for the years ended December 31, 2025, 2024, and 2023, respectively. Statutory capital and surplus of the Company amounted to $481 million and $454 million at December 31, 2025 and 2024, respectively. If the above-mentioned permitted practice was not granted by the Arizona DIFI, the Company's capital and surplus as of December 31, 2024 would have decreased by $502 million. In addition, the impact to the Company's risk-based capital ratio would have triggered a regulatory event. The permitted practice had no impact on the Company's statutory net income. Dividend Considerations The Company is subject to Arizona law, which limits the amount of dividends that insurance companies can pay to stockholders. The maximum dividend, which may be paid in any twelve-month period without notification or approval, is limited to the lesser of 10% of statutory surplus, as of December 31 of the preceding year, or the net gain from operations of the preceding calendar year. See Note 10 for further information regarding dividend activity. During the year ended December 31, 2025, an extraordinary dividend of $50 million to FGH was approved by both the Company's board of directors and the Arizona DIFI and was paid in cash during the fourth quarter of 2025. Deposits As of both December 31, 2025 and 2024 there were fixed maturity securities of $7 million on deposit with governmental authorities or trustees as required by certain insurance laws. Table of Contents Fortitude Life Insurance & Annuity Company 103
13. COMMITMENTS AND CONTINGENT LIABILITIES Commitments As of December 31, 2025 and 2024, the Company had commitments totaling $334 million and $224 million, respectively, to purchase private fixed maturity securities, mortgage loans, and alternative investments. These amounts include unfunded commitments that are not unconditionally cancellable. See Note 11 for further information regarding certain commitments to related parties. Contingent Liabilities On an ongoing basis, the Company and its regulators review its operations including, but not limited to, sales and other customer interface procedures and practices, and procedures for meeting obligations to its customers and other parties. These reviews may result in the modification or enhancement of processes or the imposition of other action plans, including concerning management oversight, sales and other customer interface procedures and practices, and the timing or computation of payments to customers and other parties. In certain cases, if appropriate, the Company may offer customers or other parties remediation and may incur charges, including the cost of such remediation, administrative costs and regulatory fines. The Company is subject to the laws and regulations of states and other jurisdictions concerning the identification, reporting and escheatment of unclaimed or abandoned funds, and is subject to audit and examination for compliance with these requirements. For additional discussion of these matters, see "Litigation and Regulatory Matters" below. It is possible that the results of operations or the cash flows of the Company in a particular quarterly or annual period could be materially affected as a result of payments in connection with the matters discussed above or other matters depending, in part, upon the results of operations or cash flows for such period. Management believes, however, that ultimate payments in connection with these matters, after consideration of applicable reserves and rights to indemnification, should not have a material adverse effect on the Company's financial position. Litigation and Regulatory Matters The Company is subject to legal and regulatory actions in the ordinary course of its business. Pending legal and regulatory actions include proceedings specific to the Company and proceedings generally applicable to business practices in the industry in which it operates. The Company is subject to class action lawsuits and other litigation involving a variety of issues and allegations involving sales practices, claims payments and procedures, premium charges, policy servicing and breach of fiduciary duty to customers. The Company is also subject to litigation arising out of its general business activities, such as its investments, contracts, leases and labor and employment relationships, including claims of discrimination and harassment, and could be exposed to claims or litigation concerning certain business or process patents. In addition, the Company, along with other participants in the businesses in which it engages, may be subject from time to time to investigations, examinations and inquiries, in some cases industry-wide, concerning issues or matters upon which such regulators have determined to focus. It is possible that legal and regulatory actions may result in certain parties seeking large and/or indeterminate amounts, including punitive or exemplary damages. The outcome of litigation or a regulatory matter, and the amount or range of potential loss at any particular time, is often inherently uncertain. The Company establishes accruals for litigation and regulatory matters when it is probable that a loss has been incurred and the amount of that loss can be reasonably estimated. For litigation and regulatory matters where a loss may be reasonably possible, but not probable, or is probable but not reasonably estimable, no accrual is established, but the matter, if material, is disclosed. The Company estimates that as of December 31, 2025, the aggregate range of reasonably possible losses in excess of recoveries from unaffiliated indemnitors regarding litigation and regulatory matters, for which such an estimate currently can be made, is not considered to be material and no accrual has been made regarding such matters. This estimate is not an indication of expected loss, if any, or the Company's maximum possible loss exposure on such matters. The Company reviews relevant information with respect to its litigation and regulatory matters on a quarterly and annual basis and updates its accruals, disclosures and estimates of reasonably possible loss based on such reviews. Table of Contents Fortitude Life Insurance & Annuity Company 104
Summary The Company's litigation and regulatory matters are subject to many uncertainties, and given their complexity and scope, their outcome cannot be predicted. It is possible that the Company's results of operations or cash flows in a particular quarterly or annual period could be materially affected by an ultimate unfavorable resolution of pending litigation and regulatory matters depending, in part, upon the results of operations or cash flows for such period. In light of the unpredictability of the Company's litigation and regulatory matters, it is also possible that in certain cases an ultimate unfavorable resolution of one or more pending litigation or regulatory matters could have a material adverse effect on the Company's financial statements. Management believes, however, that, based on information currently known to it, the ultimate outcome of all pending litigation and regulatory matters, after consideration of applicable reserves and rights to indemnification, is not likely to have a material adverse effect on the Company's financial statements. 14. SEPARATE ACCOUNTS Separate Account Assets The aggregate fair value of assets, by major investment category, supporting separate accounts is as follows: December 31, 2025 2024 Retained Business Ceded Business Total Business Retained Business Ceded Business Total Business (in millions) Mutual funds: Equity $ 14,144 $ 1,388 $ 15,532 $ 14,256 $ 1,378 $ 15,634 Fixed income 6,125 601 6,726 6,497 628 7,125 Other 13 2 15 89 9 98 Total mutual funds $ 20,282 $ 1,991 $ 22,273 $ 20,842 $ 2,015 $ 22,857 Separate Account Liabilities The balances of and changes in separate account liabilities, at fair value, are as follows: Year Ended December 31, 2025 2024 (in millions) Retained Business Ceded Business Total Business Retained Business Ceded Business Total Business Balance, beginning of year $ 20,842 $ 2,015 $ 22,857 $ 21,800 $ 2,070 $ 23,870 Deposits 26 4 30 37 4 41 Investment performance 2,594 248 2,842 2,258 216 2,474 Policy charges (419) (34) (453) (450) (36) (486) Surrenders and withdrawals (2,764) (286) (3,050) (2,818) (264) (3,082) Benefit payments (45) (3) (48) (45) (3) (48) Net transfers from general account 48 47 95 60 28 88 Balance, end of year $ 20,282 $ 1,991 $ 22,273 $ 20,842 $ 2,015 $ 22,857 Cash surrender value $ 20,260 $ 1,988 $ 22,248 $ 20,830 $ 2,013 $ 22,843 Table of Contents Fortitude Life Insurance & Annuity Company 105
15. CREDIT AND LIQUIDITY AGREEMENTS Letter of Credit Facility During 2025, the Company was added as a participant to two uncommitted bilateral letter of credit agreements to support its collateral requirements, which allows it to issue up to $300 million under these facilities. Both letter of credit agreements were initially established for certain of the Company's affiliates. Both agreements contain certain restrictive and maintenance covenants customary for facilities of this type. The ability to utilize the facilities is also subject to the ability and willingness of the banks to issue the letter of credit. The Company is currently in compliance with all covenants associated with these facilities. The Company has not utilized either credit facility since being added as a participant. Also during 2025, the Company became eligible to issue a standby letter of credit with another bank, allowing issuance of up to $100 million until its expiration in December 2027. The facility contains certain restrictive and maintenance covenants customary for facilities of this type. In addition, borrowings are not contingent on the Company's credit ratings nor subject to material adverse change clauses, however, the Company will be required to maintain a minimum Company Action Level ("CAL") Risk-based Capital ratio of 250% to maintain the agreement. In December 2025, a $1 million letter of credit was issued under the agreement, which remained outstanding as of December 31, 2025. The maximum board-approved overall capacity of the letter of credit program is $1,500 million for all participants. The maximum board-approved amount for letters of credit that can be issued under this program for FLIAC is $500 million. Intercompany Liquidity Agreement FLIAC entered into an intercompany liquidity agreement with FGH that allows the Company to borrow or loan funds of up to $300 million to meet the short-term liquidity and other capital needs of itself and FGH and its affiliates. The Company did not borrow any funds under the agreement during the year ended December 31, 2025. During the second quarter of 2025, the Company loaned $50 million of funds to FGH under the agreement, which was repaid in full, plus interest, in December 2025. During the years ended December 31, 2024 and 2023, the Company borrowed a cumulative total of $80 million and $434 million, respectively, from FGH under the agreement, all of which was repaid in full during the respective years, plus interest. In November 2023, the Company loaned $150 million of funds to FGH under the agreement, which was repaid in full, plus interest, in December 2023. Table of Contents Fortitude Life Insurance & Annuity Company 106
Item 9. Changes in and Disagreements with Independent Accountants on Accounting and Financial Disclosure None. Item 9A. Controls and Procedures Management's Annual Report on Internal Control Over Financial Reporting on the effectiveness of internal control over financial reporting as of December 31, 2025 is included in Part II, Item 8 of this Annual Report on Form 10-K. In order to provide reasonable assurance that the information we must disclose in our filings with the SEC is recorded, processed, summarized, and reported on a timely basis, the Company's management, including our Chief Executive Officer and Chief Financial Officer, have reviewed and evaluated the effectiveness of our disclosure controls and procedures, as defined in the Securities Exchange Act of 1934, as amended ("Exchange Act") Rules 15d-15(e), as of December 31, 2025. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of December 31, 2025, our disclosure controls and procedures were effective. Changes in Internal Control over Financial Reporting There were no changes in our internal control over financial reporting during the quarter ended December 31, 2025 which have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Inherent Limitations on Effectiveness of Controls Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. Item 9B. Other Information None. Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections Not applicable. Table of Contents 107
PART III Item 10. Directors, Executive Officers and Corporate Governance Corporate Governance In carrying out its responsibilities, the Board of Directors provides oversight for the process of selecting and monitoring the performance of senior management, provides oversight for financial reporting and legal and regulatory compliance, determines the Company's governance guidelines, and implements its governance policies. The Board, together with management, is responsible for establishing FLIAC's values and code of conduct and for setting the Company's strategic direction and priorities. Executive officers and directors complete a conflict of interest certification on an annual basis. This certification requires the executive officers and directors to represent that they have read the Code of Conduct, which contains the conflict of interests policy, and disclose any conflicts of interests. The Code of Conduct has been filed as an exhibit to this annual report on Form 10-K. The Company's Board of Directors has determined that all of the Company 's audit committee members are financially literate and audit committee financial experts as defined by the SEC. Except as noted in the following section, no Directors of the Company have held during the past five years an other directorship in any company with a class of securities registered pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of such Act or any company registered as an investment company under the Investment Company Act of 1940. Directors and Executive Officers Biographical information for each of FLIAC's directors and executive officers is set forth below: Directors Ciara A. Burnham, 59, Director. Ciara A. Burnham has served as a Director of FLIAC since April 1, 2022 and serves on the Audit Committee. Ms. Burnham also serves as a Director of Fortitude Re. In addition to her role as a Director of FLIAC, Ms. Burnham is a financial services executive, board director and investor with three decades of experience across the industry. Ms. Burnham serves on the boards of several financial services and fintech companies, and also works with non-profit organizations focused on ESG, social impact and education. Ms. Burnham spent two decades as a Senior Managing Director with Evercore, the global investment bank, where she worked across both the investment banking and investment management businesses. Ms. Burnham joined Evercore shortly after its inception and played a significant leadership role in the build-out of the firm's presence on a global basis. She has worked with early stage fintech companies as a senior advisor and partner with QED, a leading venture capital firm. Earlier in her career, Ms. Burnham was an equity research analyst with Sanford Bernstein and a consultant with McKinsey. Ms. Burnham received an A.B. cum laude from Princeton University and an M.B.A. with honors from Columbia Business School. She serves as Chair of the Board of Trustees for EDC, a leading non-profit working globally in education, healthcare and economic opportunity. Ms. Burnham is a member of the Advisory Boards of the Tamer Center for Social Enterprise and the Program for Financial Studies at Columbia Business School. We believe Ms. Burnham is a valuable member of our board because of her experience in the financial services industry and her work with non-profit organizations focused on ESG, social impact and education. Douglas A. French, 66, Director. Douglas A. French has served as a Director of FLIAC since April 1, 2022. Mr. French serves on the Nominating and Compensation Committee. Mr. French also serves as a Director of Fortitude Re. In addition to his role as a Director of FLIAC, Mr. French is the recent Managing Principal of the Insurance and Actuarial Advisory Services practice of Ernst & Young LLP's Financial Services Organization. Mr. French has spent more than 35 years in actuarial consulting. Before joining Ernst & Young LLP in 1999, he was a principal and global practice director of a major actuarial consulting firm. As a senior consultant, Mr. French has drawn on his global experiences to assist life, health and property/casualty clients in mergers and acquisitions, strategic planning, enterprise risk and capital management, financial reporting and management, financial projections and modeling and distribution economics and effectiveness. Throughout his career, he has not only maintained his technical actuarial skills, but has also strived to understand the broader strategic implications and drivers for the insurance industry and its participants. His deep understanding of the industry allows him to translate concepts and business models into active strategies and tactics for his clients. Mr. French is a frequent speaker at industry seminars and author in Table of Contents 108
industry publications. He is also a former Corporate Advisory Council member of the International Association of Black Actuaries, a College of Natural Sciences Advisory Council participant at the University of Texas at Austin and an Emeritus Trustee of The Actuarial Foundation. In 2018, Mr. French received the Society of Actuaries Distinguished Service Award for significant contributions to the actuarial profession. Mr. French holds a B.S. in Mathematics from the University of Texas at Austin. We believe Mr. French is a valuable member of our board because of his robust experience in actuarial consulting. Effective March 4, 2026, Dan Guilbert, 52, was appointed as a Director of FLIAC and will also serve on the Audit Committee. An industry executive with 30 years of insurance and financial services experience, Mr. Guilbert also serves as a Director of Fortitude Re. Mr. Guilbert was previously President of Individual Life and Retirement at Symetra Financial where he was responsible for all aspects of those business lines (strategy, product, sales, service, etc.). Previously, Mr. Guilbert held roles across product development, actuarial and risk functions at Hartford Life, including being appointed Chief Actuary and Risk Officer. Mr. Guilbert graduated from Bryant College with a degree in actuarial science and became a Fellow of the Society of Actuaries (FSA) in 2001. We believe Mr. Guilbert is a valuable member of our board because of his extensive leadership experience in a variety of actuarial and financial roles within the insurance industry. Brian T. Schreiber, 60, Director. Brian T. Schreiber has served as a Director of FLIAC since April 1, 2022. Mr. Schreiber also serves as a Director of Fortitude Re. In addition to his role as a Director of FLIAC, Mr. Schreiber is a Managing Director and Head of Carlyle Insurance Solutions, a business unit at Carlyle. Prior to joining Carlyle, Mr. Schreiber spent 20 years at AIG in a variety of senior executive roles, including: Chief Strategy Officer, Deputy Chief Investment Officer, and Global Treasurer, and was a member of AIG's Operating Committee, Group Risk Committee and Investment Committee. He served as a board member of United Guaranty, AIG's mortgage insurance subsidiary, and Varagon Capital, AIG's middle market direct lending joint venture. Mr. Schreiber was a key member of AIG's executive leadership team that engineered and executed AIG's successful restructuring and recapitalization. He led AIG's divestiture, hedging and capital markets activities coming out of the financial crisis, executing over 120 transactions in debt, equity and M&A and raising over $200 billion. Prior to the 2008 financial crisis, Mr. Schreiber was responsible for leading approximately $60 billion of acquisitions and strategic investments for AIG, including SunAmerica, American General and Edison Insurance Japan. Prior to AIG, Mr. Schreiber invested in financial services companies for the Bass Brothers, was an investment banker in Lehman Brothers' Financial Institutions Group, and started his career as a research associate for Booz Allen Hamilton. Mr. Schreiber holds a B.S. from New York University's Stern School of Business and an M.B.A. from Columbia Business School, and he is a member of the Council on Foreign Relations. We believe Mr. Schreiber is a valuable member of our board because of his experience as an executive at other companies in the insurance industry and his general knowledge of the financial services industry. Samuel J. Weinhoff, 75, Director. Samuel J. Weinhoff has served as a Director of FLIAC since April 1, 2022. Mr. Weinhoff serves on the Audit Committee and the Nominating and Compensation Committee. Mr. Weinhoff also serves as a Director of Fortitude Re. In addition to his role as a Director of FLIAC, Mr. Weinhoff has been an independent consultant to the insurance industry since 2000. Mr. Weinhoff began his insurance career at the Home Insurance Company in 1976 as a corporate planning analyst. He rose to the head of the corporate planning, reporting and analysis department and later became an excess casualty treaty reinsurance underwriter. Mr. Weinhoff joined the investment department of the Reliance Insurance Company in 1980. While there, he had responsibility for investing in financial institution equities. Mr. Weinhoff joined Lehman Brothers in 1985, first as an equity research analyst covering the insurance industry and later as an Investment Banker focused on insurance. In 1997, he joined Schroders & Co. as head of their U.S. financial institutions effort. Mr. Weinhoff has served on the board of directors of Infinity Property Casualty, one of the largest U.S. Hispanic auto insurers. He became head of their Audit Committee in 2008 and Lead Director in 2015. Mr. Weinhoff joined the board of directors of Allied World in 2006, where he has served as Chair of the Compensation Committee and a member of the Risk, Audit, Investment and Executive Committee. Mr. Weinhoff holds a B.A. in Economics from the University of Illinois and an M.B.A. from the Wharton School. We believe Mr. Weinhoff is a valuable member of our board because of his prior board experience and general knowledge of the insurance and reinsurance industry. Alon Neches, 49, President, Chief Executive Officer and Director. Mr. Neches has served as the President, CEO and a Director of FLIAC since September 30, 2022. Mr. Neches also serves as President, Chief Executive Officer and Director of FGH Parent, L.P. (together with its subsidiaries, "FGP"), a position he has held since September 29, 2022. Mr. Neches has more than 20 years of experience as an operator, investor and advisor in regulated industries. From 2020 until September 29, 2022, Mr. Neches was a Partner and Managing Director in Carlyle Insurance Solutions of The Carlyle Group, an affiliate of FLIAC. From 2011 to 2019, Mr. Neches held various senior executive roles at American International Group, Inc. ("AIG"), including Global Treasurer and Head of Corporate Development, where he was involved in the creation of Fortitude Re. Before joining AIG, Mr. Neches was a Senior Restructuring Specialist Officer at the Federal Reserve Bank of New York, where he focused on Table of Contents 109
managing the Federal Reserve's investment in AIG. Mr. Neches holds a B.S. in Economics from Duke University and a J.D. from Harvard Law School. Greta Hager, 45, Executive Vice President, Chief Financial Officer and Director. Ms. Hager has served as the Chief Financial Officer and a Director of FLIAC since August 2024. She also serves as the Chief Financial Officer of Fortitude Re, a position she has also held since August 2024. Prior to joining Fortitude Re, Ms. Hager spent more than 20 years in the financial services sector, with her most recent position as the Head of Financial Planning and Analysis at Mass Mutual, which she held from July 2019 until her departure to join Fortitude. Prior to that experience she served in various strategic leadership roles in both finance and accounting at AIG. Ms. Hager began her career at the public accounting firm Grant Thornton where she served as an audit professional as well as a leader within their National Professional Standards Group. Ms. Hager holds a B.S. in Business Administration from the University of Houston and was licensed as a Certified Public Accountant in Texas. Executive Officers Jeff Burman, 59, is Fortitude Re's General Counsel, and is responsible for all of the Company's legal, compliance and regulatory matters. Mr. Burman brings more than 20 years of broad legal experience in the areas of insurance and reinsurance- related transactions, regulatory matters and dispute resolution. Prior to Fortitude Re, Mr. Burman most recently served as Chief Reinsurance Legal Officer and Deputy General Counsel at AIG. At AIG, Mr. Burman led the legal function for various groups, including Reinsurance; Multinational; Insurance Company Governance; as well as the Canada, Bermuda and Latin America regions. Prior to joining AIG, Mr. Burman practiced at two leading New York law firms where he represented insurers and reinsurers, investment banks and investors in (re)insurance transactions, including mergers and acquisitions, insurance-linked securitizations and reinsurance contract drafting and dispute resolution. Mr. Burman is a graduate of Rutgers University School of Law, where he was an editor on the Rutgers Law Journal, following which he served an appellate court clerkship in New Jersey. He is a member of the bars of New York and New Jersey. Jeffrey Condit, 60, is Fortitude Re's Chief Accounting Officer and is responsible for the overall financial management and operational decision-making for the Company's accounting, reporting, financial analysis, financial systems, and internal control functions. Mr. Condit brings over 30 years of operational and financial experience in the insurance industry. Prior to his role at Fortitude Re, Mr. Condit was Senior Vice President at Unum Group, where he successfully managed the company's Closed Block Finance Segment, which included the strengthening of long-term care reserve margins and the delivery of double-digit annual growth in net operating earnings for the overall Closed Block Segment. Prior to joining Unum Group, Mr. Condit held progressive and diverse roles at Genworth Financial where, as Long-Term Care Business CFO, he led its long-term care business to industry-leading returns on new business and achieved significant operating cost reductions. Also at Genworth Financial, Mr. Condit served as Senior Vice President and AARP Business Unit Leader where, under his leadership, this newly created business delivered significant annual sales and impressive net operating earnings. Prior to Genworth Financial, Mr. Condit served as Deputy Director of Finance at GE Edison Life Insurance Company in Tokyo, Japan where he played a key leadership role in delivering significant net operating earnings growth. Early in his career, Mr. Condit held progressive financial roles at GE Financial Assurance and Arthur Andersen & Co. Jeff is a licensed CPA and holds a bachelor's degree in Economics and Business from the University of California, Los Angeles, graduating summa cum laude. Mr. Condit also completed the Executive Program at the University of Virginia, Darden School of Business. Sean Coyle, 50, is the Chief Operating Officer at Fortitude Re, and is responsible for the Operational, Information Technology, and Administration aspects of the Fortitude Re business. Mr. Coyle brings approximately 20 years of operations and technology experience in the financial services industry, with deep knowledge in the insurance industry as both an operations and technology executive. Prior to his role in Fortitude Re, Mr. Coyle was the Global Head of Finance Operations and Reengineering at AIG, where he was tasked with defining and implementing the vision, strategy, and plan for the global finance target operating model with a key focus on the use of shared services. Mr. Coyle was responsible for the creation and oversight of AIG's global Finance Centers in India as well as regional Finance Centers in Eastern Europe and South America. In addition to operational responsibilities, his team delivered strategic transformation capabilities across finance, including the oversight and management of change programs, reengineering and process automation, robotics, operating model strategy and strategic project execution. Prior to joining AIG in 2012, Mr. Coyle was Senior Vice President of Global Operations & Reengineering at ACE Group (now Chubb), where he was a member of the operations leadership team with global responsibility for the strategy, vision and execution of the operations function. Prior to joining ACE Group in 2006, Mr. Coyle was a Senior Manager with BearingPoint Inc. in the Financial Services practice and a Lead Application Developer and Architect with Proxicom, Inc. Mr. Coyle holds a bachelor's degree in Computer Science from Florida State University. Table of Contents 110
Jeffrey Mauro, 39, is the Chief Investment Officer at Fortitude Re, responsible for the implementation of asset allocation and asset/ liability management strategies. Mr. Mauro previously served as head of the Cross Asset Initiatives team in the Asset Management Group at AIG, where he developed and implemented processes to facilitate asset allocation decisions for AIG's investment portfolio. In 2013, Mr. Mauro began his tenure at AIG in the Investments Business Strategy team where he worked to execute the divestiture of certain holdings that were deemed no longer core to AIG's overall business. Prior to that, Mr. Mauro worked in Investment Banking, helping financial institutions to execute capital raising and M&A transactions at Macquarie Capital (USA) Inc. and FBR & Co. Mr. Mauro earned his Bachelors of Science in Finance and Accounting from Georgetown University. Mr. Mauro is a Chartered Financial Analyst (CFA) Charterholder. Kam Moud, 49, is the Chief Risk Officer for FLIAC and is responsible for its risk oversight and strategies. Mr. Moud is a seasoned financial services professional with more than 20 years of experience specializing in quantitative risk modeling, asset liability management, hedging strategies, and investment management across the insurance and banking sectors. Prior to joining Fortitude Re, Mr. Moud served as Head of Hedging Programs and Trading and senior portfolio manager at Corebridge Financial, where he managed the firm's hedging team with responsibility over the entire annuity product suite. Mr. Moud led the hedging workstream of the reinsurance transaction between Corebridge Financial and Venerable Holdings to reinsure all Individual Retirement variable annuities while also successfully launching the hedging strategies and program for the RILA block of business at Corebridge Financial. Before Corebridge Financial, Mr. Moud was Senior Director of Asset Liability Management and Investment Strategy at New York Life Insurance, where he was responsible for net investment income projections across all lines of business in the general account portfolios. Prior to New York Life, Mr. Moud was Managing Director at AIG and held various senior roles over risk analytics solutions, risk architecture, governance risk and control, and risk reporting. He designed and deployed enterprise-wide investment risk and capital models and solutions and enhanced the analytical capabilities of AIG's Enterprise Risk organization. Earlier in his career, Mr. Moud held research, advisory and quantitative oriented roles at State Street, Moody's Analytics, Canadian Imperial Bank of Commerce (CIBC), and Algorithmics Inc., where he developed and implemented quantitative risk models including economic capital models, credit risk models, and stress testing frameworks for financial institutions and insurance companies. Mr. Moud holds four Master of Science degrees in Statistical Signal Processing and Information Theory, Operations Research and Finance, Organizational Social Psychology, and Cognitive and Computational Neuroscience (ABD) from Chalmers University of Technology in Sweden, Queen's University Smith School of Business in Canada, Columbia University, and Graduate Center at City University of New York respectively. Mark Retik 59, Variable Life and Annuity Business Leader. Mr. Retik leads the Variable Life and Annuity Business at Fortitude Re. In this capacity, he has overall responsibility for the performance of FLIAC. Most recently, Mr. Retik served as the North American head of Munich Re's capital markets reinsurance unit. Previously, he was with Prudential Financial, where he ran the capital markets hedging team with responsibility for risk managing the firm's variable annuities. Mr. Retik spent most of his career as a Managing Director in the Securities Division of Goldman, Sachs & Co., on the equity and credit derivatives desks, developing and executing capital markets solutions for insurance and reinsurance company clients. Mr. Retik earned his BA in Mathematics from Dartmouth College and MBA from the MIT Sloan School of Management. Mr. Retik is an Associate of the Society of Actuaries. James West, 49, is the Chief Actuary at Fortitude Re where he is responsible for pricing, managing and reserving Fortitude Re's life insurance businesses. Mr. West has 20 years of experience in US Life Insurance with a wide range of Life, Annuity and A&H products. Prior to joining Fortitude Re, Mr. West held various positions at AIG, including Chief Finance Actuary Life and Chief Finance Actuary Legacy, where he was heavily involved in the establishment of Fortitude Re. Mr. West also held various actuarial positions at Conseco and earned a Bachelor of Science in Actuarial Science and Statistics from Purdue University. He is a Fellow of the Society of Actuaries and a Member of the American Academy of Actuaries. Item 11. Executive Compensation FLIAC does not have any employees. Its parent, Fortitude Group Holdings, LLC ("FGH"), provides personnel to the Company pursuant to a Services Agreement between FLIAC and FGH. As a result, FLIAC does not determine or pay any compensation to its executive officers or additional personnel provided by FGH. FGH determines and pays salaries, bonuses and all other compensation to FLIAC's executive officers and additional personnel provided by FGH. FGH compensation decisions for all persons are made commensurate with their positions, tenure and levels of responsibility. FGH also determines whether and to what extent it will provide employee benefits plans to such persons. See Part III, Item 13 for more information about the Services Agreement. FLIAC does not pay any compensation to its directors for their services as directors of FLIAC. Table of Contents 111
Item 12. Security Ownership of Certain Beneficial Owners and Management FGH directly owns 100% of the voting securities of FLIAC. FGH's principal executive offices are located at Ten Exchange Place, Suite 2210, Jersey City, NJ 07302. There are no anticipated changes in the control of FLIAC. Table of Contents 112
Item 13. Certain Relationships and Related Transactions and Director Independence Transactions between FLIAC and FGH or other FGH subsidiaries In October 2025, FLIAC entered into a reinsurance agreement to cede, on a modified coinsurance basis, at least 85% of its funding agreement liabilities associated with a funding agreement backed note program to a Bermuda-domiciled affiliate of the Company. The agreement was effective October 6, 2025 and includes funding agreements issued beginning on the effective date. In October 2025, FLIAC entered into a reinsurance agreement with an unaffiliated subsidiary of a U.S. based life insurance company to assume, on a coinsurance basis, a portion of new fixed annuity liabilities, of which 100% of the assumed business was immediately retroceded, on a modified coinsurance basis, to a Bermuda-domiciled affiliate of the Company. The agreement was effective October 6, 2025 and includes new policies beginning on the effective date. Pursuant to a Services Agreement between FLIAC and FGH, FLIAC purchases certain general and administrative services from FGH which include accounting, actuarial, risk management, and data processing services. FGH also provides FLIAC with personnel and certain other services. The allocation of costs for other services are based on estimated level of usage, transactions or time incurred in providing the respective services. FLIAC entered into an intercompany liquidity agreement with FGH and its affiliates that allows the Company to borrow or loan funds of up to $300 million to meet the short-term liquidity and other capital needs of itself and FGH and its affiliates. See Note 8 "Reinsurance", Note 11 "Related Party Transactions", and Note 15 "Credit and Liquidity Agreements" contained in Part II, Item 8 for additional information. Transactions Involving FLIAC's Directors or Executive Officers or Immediate Family Members of FLIAC's Directors and Executive Officers Except as otherwise described below, since FGH's acquisition of FLIAC, there have been no transactions to which FLIAC was a participant involving FLIAC's directors or executive officers or family relationships among any of FLIAC's directors and executive officers. Douglas A. French, a Director of FLIAC, is party to a consulting agreement with Fortitude Group Services, Inc. ("FGS"), which provides personnel and business services to other Fortitude companies pursuant to intercompany arrangements. Under the agreement, Mr. French receives fees for consulting services provided to FGS. For each of the fiscal years ended 2025, 2024, and 2023, Mr. French received consulting fees from FGS of approximately $480,000. Review, Approval or Ratification of Transactions with Related Persons FLIAC's senior management approves all related party transactions involving directors and executive officers of FLIAC. In considering the transaction, FLIAC's senior management may consider all relevant factors, including as applicable: the business rationale for entering into the transaction; the alternatives to entering into a related person transaction; whether the transaction is on terms comparable to those available to third parties, or in the case of employment relationships, to employees generally; the potential for the transaction to lead to an actual or apparent conflict of interest and any safeguards imposed to prevent such actual or apparent conflicts; and the overall fairness of the transaction to FLIAC. Potential related party transactions are covered by FLIAC's Code of Conduct policy. Approval of such related person transactions would be evidenced by resolutions of the Finance committee of the FLIAC Board of Directors in accordance with its practice of reviewing and approving transactions in this manner. Director Independence There are no family relationships among any of FLIAC's directors and executive officers. Other than the consulting agreement noted above between Mr. French and FGS, none of FLIAC's directors is a party to any material plan, contract or arrangement (whether or not written) with FLIAC, there are no arrangements or understandings between such persons and any other person pursuant to which they were selected to serve as a member of FLIAC's board of directors, they are not a participant in any related party transaction required to be reported pursuant to Item 404(a) of Regulation S-K, and there are no material plans, contracts or arrangements (whether or not written) to which the director participates that was entered into or materially amended in connection with the director's appointment. Table of Contents 113
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Item 14. Principal Accountant Fees and Services The following is a summary and description of fees for services provided by PricewaterhouseCoopers. Year Ended December 31 Services provided 2025 2024 2023 (in thousands) Audit Fees (1) $ 4,450 $ 4,385 $ 4,285 Audit-related Fees (2) 595 - - Tax Fees (3) 50 167 327 Total $ 5,095 $ 4,552 $ 4,612 (1) - The aggregate fees for professional services rendered for the audit of the consolidated financial statements of FLIAC and, as required, consents and assistance with review of documents filed with the SEC. (2) - Includes aggregate fees for assurance and related services, including internal control and financial compliance reports, issuance of comfort letters, and accounting consultation on accounting standards, acquisitions, and potential financial reporting requirements. (3) - Includes aggregate fees for tax related services to support for the Company's analysis of certain tax positions, transfer pricing studies and other professional fees. The Audit Committee maintains oversight of all audit and permissible non-audit services performed by the independent auditor, which includes recommendation of the Company's independent auditor and approval of fees for the services it provides. The Committee also considers whether such services are consistent with SEC rules on auditor independence. Table of Contents 115
PART IV Item 15. Exhibits and Financial Statement Schedules The following documents are filed as part of this report: Page (a) (1) Financial Statements-Item 8. Financial Statements and Supplementary Data 46 (2) Financial Statement Schedules: Schedule I-Summary of Investments Other Than Investments in Related Parties as of December 31, 2025 117 Any remaining schedules provided for in the applicable SEC regulations are omitted because they are either inapplicable or the relevant information is provided elsewhere within this Form 10-K. (3) Exhibits 3. (i)(a) Certificate Restating the Certificate of Incorporation of American Skandia Life Assurance Corporation, dated February 8, 1988 is incorporated by reference to the Company's Form 10-K, Registration No. 33-44202, filed March 27, 2004. (i)(b) Certificate of Amendment to the Restated Certificate of Incorporation of American Skandia Life Assurance Corporation, dated December 17, 1999 is incorporated by reference to the Company's Form 10-K, Registration No. 33-44202, filed March 27, 2004. (i)(c) Certificate of Amendment changing the name from American Skandia Life Assurance Corporation to Prudential Annuities Life Assurance Corporation, effective as of January 1, 2008, is incorporated by reference to the Company's Form 10-K, Registration No 33-44202, filed March 15, 2011. (i)(d) Articles of Domestication of Prudential Annuities Life Assurance Corporation, effective August 31, 2013, are incorporated by reference to the Company's Form 8-K, Registration No. 33-44202, filed August 30, 2013. (ii)(a) By-Laws of American Skandia Life Assurance Corporation, as amended June 17, 1998, are incorporated by reference to the Company's Form 10-K, Registration No. 33-44202, filed March 27, 2004. (ii)(b) By-Laws of Prudential Annuities Life Assurance Corporation, as amended and restated effective January 1, 2008, are incorporated by reference to the Company's Form 10-K, Registration No 33-44202, filed March 15, 2011. (ii)(c) Amended and Restated By-Laws of Prudential Annuities Life Assurance Corporation, effective August 31, 2013, are incorporated by reference to the Company's Form 8-K, Registration No. 33-44202, filed August 30, 2013. 14. Code of Ethics is incorporated by reference to the Company's Form 10-K, Registration No. 33-44202, filed March 22, 2023. 23.1 Consent of PricewaterhouseCoopers LLP is filed herewith 24. Powers of Attorney are filed herewith. 31.1 Section 302 Certification of the Chief Executive Officer. 31.2 Section 302 Certification of the Chief Financial Officer. 32.1 Section 906 Certification of the Chief Executive Officer. 32.2 Section 906 Certification of the Chief Financial Officer. 101.INS - XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH - XBRL Taxonomy Extension Schema Document. 101.CAL - XBRL Taxonomy Extension Calculation Linkbase Document 101.LAB - XBRL Taxonomy Extension Label Linkbase Document 101.PRE - XBRL Taxonomy Extension Presentation Linkbase Document 101.DEF - XBRL Taxonomy Extension Definition Linkbase Document 104.Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) Table of Contents 116
Fortitude Life Insurance & Annuity Company Schedule I Summary of Investments Other Than Investments in Related Parties As of December 31, 2025 Amortized Cost or Cost Fair Value Amount Shown in the Balance Sheet Type of Investment (in millions) Fixed maturity securities, fair value option U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 629 $ 479 $ 479 Foreign governments 1 1 1 U.S. corporate public securities 2,851 2,607 2,607 U.S. corporate private securities 364 364 364 Foreign corporate public securities 273 268 268 Foreign corporate private securities 97 92 92 Asset-backed securities 1,248 1,239 1,239 Commercial mortgage-backed securities 32 29 29 Residential mortgage-backed securities 106 108 108 Total fixed maturity securities, fair value option $ 5,601 $ 5,187 $ 5,187 Fixed maturity securities, available for sale Foreign governments 2 2 2 U.S. corporate public securities 4 4 4 U.S. corporate private securities 40 40 40 Foreign corporate public securities 4 4 4 Asset-backed securities 191 191 191 Commercial mortgage-backed securities 6 6 6 Total fixed maturity securities, available for sale $ 247 $ 247 $ 247 Mortgage loans 525 533 Short-term investments 7 7 Other invested assets (1) 46 46 Total investments $ 6,426 $ 6,020 (1) Excludes derivative instruments and associated collateral. See Notes 4, 5, and 6 for further information regarding derivative instruments. Item 16. Form 10-K Summary None. Table of Contents 117
SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Jersey City, and State of New Jersey on March 19, 2026. FORTITUDE LIFE INSURANCE & ANNUITY COMPANY (Registrant) By: /s/ Greta Hager Greta Hager Executive Vice President and Chief Financial Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on March 19, 2026. Signature Title /s/ Alon Neches President, Chief Executive Officer and Director Alon Neches (Principal Executive Officer) /s/ Greta Hager Executive Vice President, Chief Financial Officer and Director Greta Hager (Principal Financial Officer) /s/ Jeffrey Condit Chief Accounting Officer Jeffrey Condit (Principal Accounting Officer) * Ciara A. Burnham Director Ciara A. Burnham * Douglas A. French Director Douglas A. French * Dan Guilbert Director Dan Guilbert * Brian T. Schreiber Director Brian T. Schreiber * Samuel J. Weinhoff Director Samuel J. Weinhoff * By: /s/ Richard E. Buckley Richard E. Buckley (Attorney-in-Fact) Table of Contents 118
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