Lincoln National Corporation

I would now like to turn the call over to Tina Madden, Head of Investor Relations. Tina, please go ahead.

Thank you. Good morning, everyone, and welcome to our third quarter earnings call. We appreciate your interest in Lincoln. Our quarterly earnings press release, earnings supplement and statistical supplement can all be found on the investor relations page of our website, www.lincolnfinancial.com. These documents include reconciliations of the non-GAAP measures used on today's call, including adjusted income from operations and adjusted income from operations available to common stockholders or adjusted operating income to the most comparable GAAP measures. Before we begin, I want to remind you that any statements made during today's call regarding expectations, future actions, trends in our businesses, prospective services or products, future performance or financial results, including those relating to deposits, expenses, income from operations, free cash flow or free cash flow conversion ratios, share repurchases, liquidity, and capital resources, are forward-looking statements under the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from our current expectations. These risks and uncertainties include those described in the cautionary statement disclosures in our earnings release issued earlier this morning, as well as those detailed in our 2024 annual report on Form 10-K, most recent quarterly reports on Form 10-Q, and from time to time in our other filings with the SEC. these forward-looking statements are made only as of today and we undertake no obligation to update or revise any of them to reflect events or circumstances that occur after today presenting this morning are ellen cooper chairman president and ceo and chris nezapor chief financial officer after their prepared remarks we'll address your questions let me now turn the call over to ellen ellen

Thank you, Tina. And good morning, everyone. We appreciate you joining us. We delivered strong financial results in the third quarter, marking our fifth consecutive quarter of year-over-year growth in adjusted operating income and underscoring the broad-based momentum and disciplined execution as we accelerate our strategic priorities. We have remained focused and consistent in advancing our vision for Lincoln, and this quarter is another proof point. Each of our four businesses continued to make measurable progress against our transformation roadmap, translating strategy into results and contributing to the strong fundamentals that are reshaping the company into a more agile, scalable, and growth-focused enterprise with durable earnings power and a clear path to building long-term shareholder value. The core tenants of foundational capital, enhanced operational efficiency, and a strategy for profitable growth are increasingly evident in our results. We're evolving the direction of the organization with a clear focus on increasing our risk adjusted return on capital, reducing the volatility of our results, and growing our franchise. And we're starting to see the benefits of those actions. Our capital position remains well in excess of our 20 percentage point RBC buffer, and we have made significant enhancements to optimize our operating model creating a more efficient and nimble organization. Our businesses have made notable progress on strategies to shift to products and segments with higher margins, more stable cash flow profiles, and greater capital efficiency. We see meaningful opportunity ahead and are continuing to invest for future growth. Our businesses operate in attractive, expanding markets where we compete from a position of strength, grounded in our trusted brand, leading franchise, and clear competitive advantages in distribution, product manufacturing, and customer service. Our trajectory continues to accelerate. Our track record is increasingly clear. And while our progress won't always be linear, we're confident in the direction we're heading and excited about the path forward. I'd like to briefly comment on our annual assumption review, which continues to be a rigorous and comprehensive process, encompassing all key assumptions. The outcome this year reflected some puts and takes, resulting in a small, favorable impact to adjusted operating income in the quarter, highlighting the continued alignment between our underlying experience and our go-forward expectations. The process provides a strong foundation for disciplined evaluation and well-structured governance of assumptions. Now turning to our third quarter performance, excluding the impact of our annual assumption review. Each of our businesses generated robust year over year results, reflecting continued momentum and execution against our strategic priorities. Key highlights included annuities recording earnings growth driven by higher account balances and strong and diversified sales. Life insurance posted improved earnings supported by stable mortality and operational efficiencies while achieving higher sales driven by executive benefits. Group protection delivered earnings that were in line with its prior year record third quarter healthy premium growth and broad-based sales growth across market segments and products. Retirement plan services delivered higher earnings attributable to increased account balances and produced positive net flows in the quarter. Now turning to our business results, starting with annuities. Our annuities business continued to deliver excellent year-over-year and sequential sales growth, reflecting sustained progress in our strategy to diversify our new business mix. Reported sales reached 4.5 billion, our fourth consecutive quarter of increased sales with our spread-based products, including fixed annuities and RILA, representing 63% of the new business total. Each of our three core product categories, fixed, Ryla, and variable annuities, exceeded $1 billion in sales, supporting our focus on building and sustaining a more balanced product mix, supporting our strategic and financial goals with strong profitability and capital efficiency, and underscoring our differentiated ability to capture customer demand. Our go-to-market strategy, combined with our breadth of products, deep, long-standing distribution relationships, and consultative wholesaler model enables us to broaden our addressable markets and reach more customers seeking to retire with confidence and financial security. Our distribution partners value our customer-centric approach, which equips producers with the insights, tools, and capabilities to deliver the right solutions while enhancing their productivity and ease of doing business. As a holistic solutions provider with a product suite that continues to expand, we are positioning our annuities business for further growth. As a leading product manufacturer, we are delivering innovative new features that are meeting evolving customer needs across various environments, further distinguishing us in the marketplace. Our fixed annuity sales increased by 36% year over year, As we leveraged the foundational product and distribution capabilities we built to sustain a consistent and growing presence in the fixed segment. We also continued to invest in our service model to deliver more seamless value add capabilities to support our customers. Additionally, during the quarter, we transitioned to fully retaining the flows from our fixed sales, which will enhance the growth of our spread-based earnings over time. Our RILA sales increased 21% year over year, a sixth consecutive quarter of sequential growth that reflects our ability to differentiate through distinctive and expanded product features and crediting strategies that resonate with customers. Sales volumes of our traditional variable annuities were also up year over year. Our variable product suite offers a broad array of features and benefits that meet customer needs and remain integral to our overall offering. VAs remain a valuable contributor to our overall product mix, generating strong free cash flow and attractive risk-adjusted returns. In summary, these results demonstrate the success we are achieving in delivering a diversified product mix that meets customers where they are across different life stages, risk tolerances, and economic environments. The strategy to increase the proportion of our spread-based earnings through profitable new business generation translates into more resilient and predictable cash flows over time while meeting our risk-adjusted return targets and balancing the financial contribution across products. We remain confident in the strategic trajectory within our annuities business and our ability to leverage our competitive strengths to achieve our profitability objectives. Now turning to life insurance. As I've mentioned on prior calls, we have taken decisive steps to reposition this business for long-term value creation. We have strategically shifted our new business mix to emphasize products that support our strategic objectives, those with growing addressable markets that offer compelling value propositions for our customers, enable efficient capital deployment, and position us for durable, profitable growth. This quarter's results reflect the progress we are making as our strategic realignment continues to gain traction. Excluding the impact of our annual assumption review, life earnings reached $54 million, marking a significant year-over-year improvement. Sales totaled nearly $300 million, with executive benefits accounting for two-thirds of that volume, driven by a couple of large cases. In this product category, we have enhanced our competitiveness through targeted product additions and by strengthening our distribution relationships and expanding our service model, enabling us to deliver a strong quarter for executive benefit sales. While we don't expect this level of sales to repeat in the fourth quarter, given the natural variability and large case activity, we have built the foundational capabilities to support a growing presence in this segment. We are continuing to invest to ensure a long-term growth path and are encouraged by the results we're seeing. Our other life sales were a well-balanced product mix aligned to our targeted strategy. The momentum this quarter reflects the effect of the deliberate actions we've taken over the past several years, optimizing our wholesaler footprint, emphasizing products with more stable cash flows, and enhancing the customer experience. We are continuing to invest in modernizing our service model and advancing our digital offerings to deliver a more integrated customer experience. Through expanded technology, we are differentiating our capabilities to provide real-time insights to support faster data-driven decisions and position us for sustained growth. In the life business, we are seeing the early impact of our repositioning efforts and remain steadfast in our commitment to enhance and grow this business and realize its full long-term potential. Next, turning to our group protection business, As mentioned earlier, Group's earnings were in line with its prior year record third quarter, although modestly below our expectations. Importantly, the core fundamentals of this business remain strong. We continue to execute on our targeted strategy of delivering value across three unique market segments. local regional and national with an ongoing strategic focus on repositioning this business for sustainable profitable growth transforming how we operate and delivering reliable quality customer service We're seeing tangible results from our actions as reflected in our year-over-year 5 percent premium growth driven by robust sales, strong persistency, and pricing discipline across both new and renewal business. Our premium expansion was broad-based with increasing results across all market segments and product categories with supplemental health, a strategic area of focus, increasing 33 percent year-over-year. This growth underscores the execution of our strategy to diversify across market segments expand and deepen the product portfolio and invest in the people process and technology to create differentiated capabilities that deliver a simpler faster and more connected customer experience. While the third quarter is typically a seasonally lighter sales period, Group delivered year-over-year sales growth of nearly 40%, broadly diversified across market segments and products. In this business, servicing our customers with excellence is a strategic differentiator. As we look ahead, we will continue to drive our segment strategy in a profitable and sustainable way by broadening our distribution relationships, expanding our product suite, and continuing to expand our digital tools and technology to drive more productivity, efficiency, and effectiveness. Grounded in a strong foundation and disciplined execution from pricing to expansion and growing addressable markets, our group business is well positioned to drive sustainable growth and profitability. While we expect some variability in results from quarter to quarter, the fundamentals are strong and the long-term trajectory is positive. Now turning to Retirement Plan Services, or RPS. RPS delivered a strong quarter, achieving 5% year-over-year earnings growth and first-year sales of $2.4 billion as the robust new business pipeline we previously communicated materialized this quarter. Additionally, total deposits increased 20% year-over-year and net flows were positive, driven by the strong sales momentum in the quarter. Our offerings and our core record-keeping and institutional markets continue to drive meaningful customer engagement, reinforcing our long-term growth potential. Looking ahead, we will continue to focus on initiatives that will enhance our operational and service capabilities, broaden our product offerings, and drive greater efficiency as we pursue sustainable and profitable growth. In closing, we are moving forward with conviction, intention, and collective determination. The progress we have made is evident not only in our financial results, but in the precision of our execution, an operating model we are continuing to refine and fortify, and the durability of our capital position. We are expanding our strategic advantage by pivoting toward higher margin, capital efficient growth, investing in the foundational core that sharpens our competitive edge, and evolving into a more agile, scalable, and forward-looking enterprise. Through discipline transformation, we are building a market-leading franchise equipped to thrive in a dynamic environment, align capital with strategic priorities, and capture value where we have built scale and momentum. In summary, we are delivering today while advancing the capabilities that will drive tomorrow. With that, I will turn the call over to Chris.