Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with Globe Life's Condensed Consolidated Financial Statements and Notes thereto appearing elsewhere in this report. The following management discussion will only include comparison to prior year.
"Globe Life" and the "Company" refer to Globe Life Inc. and its subsidiaries and affiliates.
Results of Operations
How Globe Life Views Its Operations. Globe Life Inc. is the holding company for a group of insurance companies that market through exclusive, direct-to-consumer and independent distribution channels primarily individual life and supplemental health insurance to lower middle to middle-income households throughout the United States. We view our operations by segments, which are the insurance product lines of life and supplemental health, and the investment segment that supports the product lines.
Insurance Product Line Segments. The insurance product line segments involve the marketing, underwriting, and administration of policies. Each product line is further subdivided by the various distribution channels that market the insurance policies. Each distribution channel operates in a niche market offering insurance products designed for that particular market. Whether analyzing profitability of a segment as a whole, or the individual distribution channels within the segment, the measure of profitability used by management is the underwriting margin, as seen below:
Premium revenue
(Policy obligations)
(Policy acquisition costs and commissions)
Underwriting margin
Investment Segment. The investment segment involves the management of our capital resources, including investments and the management of liquidity. Our measure of profitability for the investment segment is excess investment income, as seen below:
Net investment income
(Required interest on policy liabilities)
Excess investment income
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GL Q2 2026 FORM 10-Q
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GLOBE LIFE INC.
Management's Discussion & Analysis
Globe Life serves the lower-middle to middle-income market. We believe this market is underserved, has significant growth potential, and provides us with a distinct competitive advantage. This advantage is protected due not only to our ability to efficiently reach this market through both exclusive and direct to consumer distribution channels, but also due to the amount of data and experience we possess, as we have been in this same market for over 60 years with essentially the same products. The basic protection life and health insurance products we offer are specifically designed to help provide financial security to consumers in this market.
Current Highlights.
•On a diluted basis, net income per common share increased 16% from $6.07 to $7.04 and net operating income per common share increased from $6.34 to $7.04, an 11% increase as of June 30, 2026 and 2025, respectively.
•Net income as a return on equity (ROE) for the six months ended June 30, 2026 was 18.4% and net operating income as an ROE, excluding accumulated other comprehensive income(1), was 14.3%.
•Total premium increased 6% over the same period in the prior year. Life premium increased 3% for the period from $1.67 billion in 2025 to $1.71 billion in 2026. Health premium increased 14% to $854 million from $748 million over the prior-year period.
•Total net sales increased 10% over the same period in the prior year from $439 million in 2025 to $484 million in 2026. Average producing agent count increased by 9% at both Liberty National and Family Heritage Divisions. However, total average producing agent count across all of the exclusive agencies decreased over the prior year primarily related to a decrease in the American Income Division.
•Book value per share increased 18% over the same period in the prior year from $66.07 to $78.18. Book value per share, excluding accumulated other comprehensive income(1), increased 11% over the prior year from $90.26 in 2025 to $100.04 in 2026.
•T1For the six months ended June 30, 2026, the Company repurchased 2.6 million shares of Globe Life Inc. common stock at a total cost of $378 million for an average share price of $146.99.
The following graphs represent net income and net operating income(1) for the six month periods ended June 30, 2026 and 2025.
(1)As shown in the charts above, net operating income is primarily comprised of insurance underwriting margin plus excess investment income and annuity and other income, offset by operating expenses after tax and, as such, is considered a non-GAAP measure. It has been used consistently by Globe Life's management for many years to evaluate the operating performance of the Company. Net operating income differs from net income primarily because it excludes certain non-operating items such as realized gains and losses and certain significant and unusual items included in net income. Net income is the most directly comparable GAAP measure.
Net operating income as an ROE, excluding AOCI, is considered a non-GAAP measure. Management utilizes this measure to view the business without the effect of changes in AOCI, which are primarily attributable to fluctuation in interest rates. The impact of the adjustment to exclude AOCI is $(1.7) billion and $(2.0) billion for the six months ended June 30, 2026 and 2025, respectively.
Book value per share, excluding AOCI, is also considered a non-GAAP measure. Management utilizes this measure to view the book value of the business without the effect of changes in AOCI, which are primarily attributable to fluctuation in interest rates. The impact of the adjustment to exclude AOCI is $(21.86) and $(24.19) per share for the six months ended June 30, 2026 and 2025, respectively.
Refer to Analysis of Profitability by Segment for non-GAAP reconciliation to GAAP.
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GLOBE LIFE INC.
Management's Discussion & Analysis
Summary of Operations.
•Net income totaled $558 million during the six months ended June 30, 2026, compared with $507 million, in the same period in 2025, an increase of 10%.
•On a diluted basis, net income per common share for the six months ended June 30, 2026 increased 16% from $6.07 to $7.04.
•Net operating income was $558 million for the six months ended June 30, 2026, compared with $530 million for the same period in 2025, an increase of 5%.
•On a diluted basis, net operating income per common share for the six months ended June 30, 2026 increased from $6.34 to $7.04, an 11% increase.
Net operating income is primarily comprised of insurance underwriting margin plus excess investment income and annuity and other income, offset by operating expenses, after tax and, as such, is considered a non-GAAP measure. Net income is the most directly comparable GAAP measure. We do not consider realized gains and losses to be a component of our core insurance operations or operating segments. Additionally, net income is affected by certain non-operating items. We do not view these items as components of core operating results because they are not indicative of past performance or future prospects of the insurance operations. We remove items such as these that relate to prior periods or are non-operating items when evaluating the results of current operations, and therefore exclude such items from our segment analysis for current periods.
The Company's core operations remain strong, including sales and premium growth, and we continue to achieve an operating ROE (excluding accumulated other comprehensive income) generally in the mid-teens.
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GLOBE LIFE INC.
Management's Discussion & Analysis
Globe Life's operations on a segment-by-segment basis are discussed in depth below. Net operating income has been used consistently by management for many years to evaluate the operating performance of the Company and is a measure commonly used in the life insurance industry. It differs from GAAP net income primarily because it excludes certain non-operating items such as realized gains and losses and other significant and unusual items included in net income. Management believes an analysis of net operating income is important in understanding the profitability and operating trends of the Company’s business. Net income is the most directly comparable GAAP measure.
Analysis of Profitability by Segment
(Dollar amounts in thousands)
Six Months Ended June 30,
2026
2025
Change
%
Life insurance underwriting margin
$
708,408
$
677,338
$
31,070
5
Health insurance underwriting margin
193,789
182,778
11,011
6
Excess investment income
74,969
70,698
4,271
6
Segment profit or (loss)
977,166
930,814
46,352
5
Annuity and other income
6,229
3,971
2,258
57
Administrative expense
(185,732)
(173,596)
(12,136)
7
Other corporate expense
(108,729)
(102,544)
(6,185)
6
Pre-tax total
688,934
658,645
30,289
5
Applicable taxes
(130,729)
(128,213)
(2,516)
2
Net operating income
558,205
530,432
27,773
5
Reconciling items, net of tax:
Realized gains (losses)
4,472
(14,607)
19,079
Other expenses
(72)
—
(72)
Legal proceedings
(4,332)
(8,513)
4,181
Net income
$
558,273
$
507,312
$
50,961
10
The life insurance segment is our primary segment and is the largest contributor to earnings in each period presented. The life insurance segment underwriting margin increased $31 million compared with the prior period, driven by premium growth and lower policy obligations as a percent of premium. Excess investment income increased $4 million compared with the prior period, primarily due to higher yields on fixed maturities, commercial mortgage loans and other long-term investments. The health segment experienced favorable underwriting margin as a result of higher premiums from strong growth in Medicare Supplement sales in addition to the positive impact of higher premium rates on individual Medicare Supplement policies as a result of approved rate increases.
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GLOBE LIFE INC.
Management's Discussion & Analysis
In 2026, the largest contributor of total underwriting margin was the life insurance segment and the primary distribution channel was American Income. The following charts represent the breakdown of total underwriting margin by operating segment and distribution channel for the six months ended June 30, 2026.
Total premium income rose 6% for the six months ended June 30, 2026 to $2.6 billion. Total net sales increased 10% to $484 million when compared with 2025. Total first-year collected premium (defined in the following section) increased 19% to $408 million for 2026, compared to $343 million in 2025.
Life insurance premium income increased 3% to $1.71 billion compared to $1.67 billion in the prior-year period. Life net sales increased 1% to $307 million for the six months ended June 30, 2026 as compared to the year-ago period. First-year collected life premium increased 2% to $234 million. Life underwriting margin, as a percent of premium, was flat at 41% for 2026. Underwriting margin increased to $708 million in 2026, compared to $677 million in 2025.
T2Health insurance premium income increased 14% to $854 million compared to $748 million in the prior-year period. Health net sales rose 30% to $177 million for the six months ended June 30, 2026. First-year collected health premium rose 54% to $174 million. Health underwriting margin, as a percent of premium, was 23% for 2026, a 1% decrease from 2025 as a result of increased group claims experience. Health underwriting margin increased to $194 million for the six months ended June 30, 2026, compared to $183 million in 2025.
Excess investment income, the measure of profitability of our T3investment segment, increased 6% during the six months ended June 30, 2026 to $75 million from $71 million in 2025. Excess investment income per common share, reflecting the impact of our share repurchase program, increased 11% to $0.94 from $0.85 when compared with the same period in 2025.
Insurance administrative expenses increased 7% primarily due to higher employee costs, which include salaries and other costs in addition to higher information technology expenses in 2026 when compared with the prior-year period. These expenses were 7.2% as a percent of premium for 2026, unchanged from 2025.
For the six months ended June 30, 2026, the Company repurchased 2.6 million shares of Globe Life Inc. common stock at a total cost of $378 million for an average share price of $146.99.
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GLOBE LIFE INC.
Management's Discussion & Analysis
The discussions of our segments are presented in the manner we view our operations, as described in Note 12—Business Segments.
We use three measures as indicators of premium growth and sales over the near term: “annualized premium in force,” "net sales,” and “first-year collected premium.”
•Annualized premium in force is defined as the premium income that would be received over the following twelve months at any given date on all active policies if those policies remain in force throughout the 12-month period.
•Net sales is calculated as annualized premium issued, net of cancellations in the first 30 days after issue, except in the case of Direct to Consumer, where net sales is annualized premium issued at the time the first full premium is paid after any introductory offer period (typically one month) has expired. Management considers net sales to be a better indicator of incremental premium growth than annualized premium issued since net sales are after cancellations, as cancellations do not contribute to premium income.
•First-year collected premium is defined as the premium collected during the reporting period for all policies in their first policy year. First-year collected premium takes lapses into account in the first year when lapses are more likely to occur, and thus is a useful indicator of how much new premium is expected to be added to premium income in the future. First-year collected premiums are lower than net sales over the prior 12 months because premiums are not collected on lapsed policies after the date of lapse. In addition, cancellations are not considered as lapses related to net sales and first-year collected premiums.
See further discussion of the distribution channels below for Life and Health.
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GLOBE LIFE INC.
Management's Discussion & Analysis
LIFE INSURANCE
Life insurance is the Company's predominant segment. During 2026, life premium represented 67% of total premium and life underwriting margin represented 79% of the total underwriting margin. Additionally, investments supporting the reserves for life products produce the majority of income attributable to the investment segment.
The following table presents the summary of results of life insurance. Further discussion of the results by distribution channel is included below.
Life Insurance
Summary of Results
(Dollar amounts in thousands)
Six Months Ended June 30,
Change
2026
2025
Amount
% of Premium
Amount
% of Premium
Amount
%
Premium and policy charges
$
1,713,972
100
$
1,669,407
100
$
44,565
3
Policy obligations
1,032,809
60
1,029,111
62
3,698
—
Required interest on reserves
(435,078)
(25)
(419,696)
(25)
(15,382)
4
Net policy obligations
597,731
35
609,415
37
(11,684)
(2)
Amortization of acquisition costs
207,345
12
186,834
11
20,511
11
Commission expense
87,707
5
87,924
5
(217)
—
Premium taxes
36,033
2
34,693
2
1,340
4
Non-deferred acquisition costs
76,748
5
73,203
4
3,545
5
Total expense
1,005,564
59
992,069
59
13,495
1
Insurance underwriting margin
$
708,408
41
$
677,338
41
$
31,070
5
Net policy obligations decreased to 35% of premium for the six months ended June 30, 2026 reflecting improved mortality results when compared with 37% of premium in the year-ago period.
The table below summarizes life underwriting margin by distribution channel.
Life Insurance
Underwriting Margin by Distribution Channel
(Dollar amounts in thousands)
Six Months Ended June 30,
2026
2025
Change
Amount
% of Premium
Amount
% of Premium
Amount
%
American Income
$
422,612
46
$
400,702
45
$
21,910
5
Direct to Consumer
149,514
31
133,159
27
16,355
12
Liberty National
71,944
36
65,218
34
6,726
10
Other(1)
64,338
65
78,259
78
(13,921)
(18)
Total
$
708,408
41
$
677,338
41
$
31,070
5
(1) Includes a gain of $14 million related to the recapture of reinsurance for six months ended June 30, 2025.
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Globe Life Inc.
Management's Discussion & Analysis
The following table presents Globe Life's life insurance premium by distribution channel.
Life Insurance
Premium by Distribution Channel
(Dollar amounts in thousands)
Six Months Ended June 30,
Change
2026
2025
Amount
% of Total
Amount
% of Total
Amount
%
American Income
$
925,534
54
$
883,377
53
$
42,157
5
Direct to Consumer
488,443
28
491,823
29
(3,380)
(1)
Liberty National
200,401
12
193,445
12
6,956
4
Other
99,594
6
100,762
6
(1,168)
(1)
Total
$
1,713,972
100
$
1,669,407
100
$
44,565
3
Annualized life premium in force was $3.46 billion at June 30, 2026, an increase of 2% over $3.38 billion a year earlier.
An analysis of life net sales, an indicator of new business production, by distribution channel is presented below.
Life Insurance
Net Sales by Distribution Channel
(Dollar amounts in thousands)
Six Months Ended June 30,
Change
2026
2025
Amount
% of Total
Amount
% of Total
Amount
%
American Income
$
196,070
64
$
194,782
64
$
1,288
1
Direct to Consumer
53,766
17
56,271
19
(2,505)
(4)
Liberty National
51,489
17
47,084
15
4,405
9
Other
5,653
2
5,099
2
554
11
Total
$
306,978
100
$
303,236
100
$
3,742
1
First-year collected life premium by distribution channel is presented in the table below.
Life Insurance
First-Year Collected Premium by Distribution Channel
(Dollar amounts in thousands)
Six Months Ended June 30,
Change
2026
2025
Amount
% of Total
Amount
% of Total
Amount
%
American Income
$
158,273
68
$
157,171
68
$
1,102
1
Direct to Consumer
31,407
13
30,676
13
731
2
Liberty National
39,908
17
38,799
17
1,109
3
Other
4,703
2
3,900
2
803
Total
$
234,291
100
$
230,546
100
$
3,745
2
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GL Q2 2026 FORM 10-Q
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Globe Life Inc.
Management's Discussion & Analysis
A discussion of life operations by distribution channel follows.
The American Income Life Division is an exclusive agency that markets to members of affinity groups, including labor unions, and continues to diversify its lead sources by utilizing internally generated leads, third-party internet vendor leads, and referrals to facilitate sustainable growth. This Division is Globe Life's largest contributor of life premium of any distribution channel at 54% of the Company's June 30, 2026 total life premium. For the six months ended June 30, 2026, life premium was $926 million, an increase of 5% when compared with the year-ago period. For the six months ended June 30, 2026, the average monthly life premium issued per policy was $63 as compared to $59 for the same period in the prior year.
Net sales were $196 million for the six months ended June 30, 2026, up from $195 million in the year-ago period. The underwriting margin, as a percent of premium, was 46% for the six months ended June 30, 2026 and 45% for the same period in the prior year.
T4The average producing agent count decreased 5% over the year-ago period driven by lower retention of new agents. However, we have seen incremental agent count growth from first quarter to the second quarter in 2026. While long-term sales growth in this Division and our other exclusive agencies is generally tied to expansion of the agency force, short-term declines in agent count provide an opportunity for improved sales productivity among veteran agents as their primary focus is on sales activities.
Below is the average producing agent count as of the indicated periods for the American Income Life Division. The average producing agent count is based on the actual count at the beginning and end of each week during the year.
At June 30,
Change
2026
2025
Amount
%
American Income
11,228
11,876
(648)
(5)
American Income Life continues to focus on growing and strengthening the agency force, with particular emphasis on strengthening agency middle-management growth. The Division has made considerable investments in both financial incentives and agent training, as well as in information technology. A customer relationship management ("CRM") tool equips agents with intuitive dashboards to drive productivity across lead distribution, business conservation, and new agent recruiting. The Division also continues to enhance technology enabling the agency force to recruit, sell and train virtually. This has benefited our agents as a vast majority of sales are now generated through virtual presentations. We find this flexibility to be attractive for new recruits as well as a driver of retention in our agency force.
The Direct to Consumer Division ("DTC") markets adult and juvenile life insurance across multiple channels including direct mail, insert media, and digital marketing using an integrated omnichannel approach where each channel supports and amplifies the others. Digital channels, including internet sales and inbound phone calls, continue to outpace direct mail in activity and growth.
DTC's long-term growth has been driven by consistent innovation and strong brand awareness. The Division also plays a valuable supporting role for our agency business, generating brand impressions, consumer inquiries and sales leads that convert into sales across our exclusive agency channels. Recent technology investments have meaningfully enhanced the underwriting process, improving the conversion of customer inquiries into sales, while new initiatives are continuously introduced to increase response rates, improve issue rates, and deliver a seamless customer experience.
The juvenile insurance market remains an important channel, though growth has slowed over recent quarters. It continues to serve as a valuable gateway for reaching the parents and grandparents of existing juvenile policyholders. These parents and grandparents have shown a higher likelihood of responding to direct-to-consumer life insurance offers compared to the general adult population, making future outreach to them a lower-cost opportunity to drive both adult and juvenile insurance sales.
DTC net sales declined 4% to $54 million for the six months ended June 30, 2026, compared to the year-ago period. T5The Division is navigating a transition driven by the growing use of Artificial Intelligence ("AI") in consumer search behavior, which has reduced paid search volume from internet marketing. DTC is actively adapting a digital content strategy to remain visible and accessible within AI-driven environments.
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Globe Life Inc.
Management's Discussion & Analysis
Beyond direct sales, DTC continues to deliver significant value through agency support with lead generation expected to exceed one million this year. Improved conversion rates on leads shared with our agencies have contributed to margin improvement. Despite the decline in net sales, DTC’s underwriting margin grew to $149.5 million, or 31% of premium, for the six months ended June 30, 2026, compared to $133.2 million, or 27% of premium, for the same period in 2025 driven by favorable mortality in the current period. For the six months ended June 30, 2026, the average monthly life premium issued for DTC adults increased to $19 as compared to $17 for the same period in the prior year.
The Liberty National Division is an exclusive agency serving middle-income households and worksite customers by providing individual life insurance products. Recent investments in new sales technologies, combined with growth in agency middle management, are expected to drive continued sales momentum. Underwriting margin rose 10% from the year ago period to $72 million and premium increased 4% to $200 million. The underwriting margin as a percent of premium increased for the six months ended June 30, 2026, to 36%, compared to 34% in the year-ago period, as the Division experienced favorable mortality. For the six months ended June 30, 2026, the average monthly life premium per policy issued increased compared to the prior year to $48 from $44.
Below is the average producing agent count for the six months ended June 30, 2026 and 2025 for the Liberty National Division. The average producing agent count is based on the actual count at the beginning and end of each week during the year.
At June 30,
Change
2026
2025
Amount
%
Liberty National
4,113
3,785
328
9
The Liberty National Division's average producing agent count increased when compared with the prior-year comparable period. This Division continues to execute a long-term plan to grow through expansion from small-town markets in the Southeast to more densely populated areas with larger pools of potential agent recruits and customers. Expansion of this Division’s presence in larger geographic cities with less penetrated areas will help create long-term sustainable agency growth. The Division is also focused on expanding worksite business development capabilities among its agents. A CRM platform and enhanced analytical tools have strengthened worksite marketing efforts and improved productivity across the individual life market. As Liberty National continues to build momentum through technology adoption and recruiting initiatives, it anticipates sustained growth in recruiting activity, average producing agent count, and net sales.
The Other agency distribution channels primarily include non-exclusive independent agencies selling primarily life insurance. The Other distribution channels contributed $100 million of life premium income, or 6% of Globe Life's total life premium income in the six months ended June 30, 2026, and contributed 2% of net sales for the period.
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Globe Life Inc.
Management's Discussion & Analysis
HEALTH INSURANCE
Health insurance sold by the Company primarily includes Medicare Supplement insurance as well as retiree health insurance, accident coverage, and other limited-benefit supplemental health products such as cancer, critical illness, heart disease, accident, intensive care, and other health products.
Health premium accounted for 33% of our total premium in 2026, while the health underwriting margin accounted for 21% of total underwriting margin. Health underwriting margin increased to $194 million compared to $183 million in the prior year.
The following table presents underwriting margin data for health insurance.
Health Insurance
Summary of Results
(Dollar amounts in thousands)
Six Months Ended June 30,
Change
2026
2025
Amount
% of
Premium
Amount
% of
Premium
Amount
%
Premium
$
853,763
100
$
747,890
100
$
105,873
14
Policy obligations
540,746
63
463,853
62
76,893
17
Required interest on reserves
(57,833)
(7)
(56,677)
(7)
(1,156)
2
Net policy obligations
482,913
56
407,176
55
75,737
19
Amortization of acquisition costs
31,474
4
29,360
4
2,114
7
Commission expense
94,935
11
84,852
11
10,083
12
Premium taxes
16,551
2
15,142
2
1,409
9
Non-deferred acquisition costs
34,101
4
28,582
4
5,519
19
Total expense
659,974
77
565,112
76
94,862
17
Insurance underwriting margin
$
193,789
23
$
182,778
24
$
11,011
6
Net policy obligations amounted to 56% of premium for the six months ended June 30, 2026 compared to 55% in the year-ago period. The increase in policy obligations is driven by the growth of the United American Division in relation to total health premium, as the United American Division products tend to have higher policy obligations as a percent of premium compared to other limited-benefit health products within our other divisions.
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Globe Life Inc.
Management's Discussion & Analysis
The table below summarizes health underwriting margin by distribution channel.
Health Insurance
Underwriting Margin by Distribution Channel
(Dollar amounts in thousands)
Six Months Ended June 30,
2026
2025
Change
Amount
% of Premium
Amount
% of Premium
Amount
%
United American
$
16,195
4
$
14,019
4
$
2,176
16
Family Heritage
88,832
36
80,176
35
8,656
11
Liberty National
48,815
51
50,354
53
(1,539)
(3)
American Income
36,992
60
38,714
62
(1,722)
(4)
Direct to Consumer
2,955
7
(485)
(1)
3,440
Total
$
193,789
23
$
182,778
24
$
11,011
6
Globe Life markets supplemental health insurance products through a number of distribution channels. The following table is an analysis of our health premium by distribution channel.
Health Insurance
Premium by Distribution Channel
(Dollar amounts in thousands)
Six Months Ended June 30,
Increase
(Decrease)
2026
2025
Amount
% of Total
Amount
% of Total
Amount
%
United American
$
405,842
48
$
323,826
43
$
82,016
25
Family Heritage
249,412
29
228,210
31
21,202
9
Liberty National
94,982
11
95,553
13
(571)
(1)
American Income
61,924
7
62,113
8
(189)
—
Direct to Consumer
41,603
5
38,188
5
3,415
9
Total
$
853,763
100
$
747,890
100
$
105,873
14
Premiums from Medicare Supplement products totaled $400 million, or 47%, of the total health premiums for the six months ended June 30, 2026, compared to $331 million, or 44%, in the same period in the prior year. Premium increases are driven primarily from increased sales and approved premium rate increases on our Medicare Supplement business. Premiums primarily related to limited-benefit supplemental health products comprise $454 million, or 53%, of the total health premiums for the six months ended June 30, 2026, compared with $417 million, or 56%, in the same period in the prior year.
Annualized health premium in force was $1.80 billion at June 30, 2026, an increase of 16% over $1.54 billion a year earlier.
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Globe Life Inc.
Management's Discussion & Analysis
Presented below is a table of health net sales by distribution channel.
Health Insurance
Net Sales by Distribution Channel
(Dollar amounts in thousands)
Six Months Ended June 30,
Increase
(Decrease)
2026
2025
Amount
% of Total
Amount
% of Total
Amount
%
United American
$
89,428
50
$
53,162
39
$
36,266
68
Family Heritage
63,438
36
56,377
42
7,061
13
Liberty National
13,959
8
15,380
11
(1,421)
(9)
American Income
8,410
5
9,619
7
(1,209)
(13)
Direct to Consumer
1,314
1
1,431
1
(117)
(8)
Total
$
176,549
100
$
135,969
100
$
40,580
30
Health net sales related to limited-benefit supplemental health products and other health products comprise $122 million, or 69%, of the total health net sales for the six months ended June 30, 2026, compared with $101 million, or 74%, in the same period in the prior year. Medicare Supplement sales make up the remaining $55 million, or 31%, for 2026, compared to $35 million, or 26%, in the same period in the prior year.
The following table presents health insurance first-year collected premium by distribution channel.
Health Insurance
First-Year Collected Premium by Distribution Channel
(Dollar amounts in thousands)
Six Months Ended June 30,
Increase
(Decrease)
2026
2025
Amount
% of Total
Amount
% of Total
Amount
%
United American
$
98,904
57
$
42,723
38
$
56,181
132
Family Heritage
49,383
28
43,921
39
5,462
12
Liberty National
13,809
8
13,982
12
(173)
(1)
American Income
8,437
5
9,623
9
(1,186)
(12)
Direct to Consumer
3,253
2
2,319
2
934
40
Total
$
173,786
100
$
112,568
100
$
61,218
54
First-year collected premium related to limited-benefit supplemental health products and other health products is $113 million, or 65%, of total first-year collected premium for the six months ended June 30, 2026, compared with $77 million, or 69%, in the same period in the prior year. First-year collected premium from Medicare Supplement policies make up the remaining $61 million, or 35%, for the six months ended June 30, 2026, compared to $35 million, or 31%, in the same period in the prior year.
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Globe Life Inc.
Management's Discussion & Analysis
A discussion of health operations by distribution channel follows.
The United American Division consists of non-exclusive independent general agents and brokers who may also sell for other companies. The United American Division was Globe Life's largest health division in terms of health premium income, with net sales up 68% from the same period in the prior year. Medicare Supplement sales growth remained strong for the quarter ended June 30, 2026, supported by demographic expansion within the eligible population, a notable migration of Medicare beneficiaries from Medicare Advantage to Medicare Supplement plans, and rate increases that took effect during the quarter.
This Division includes units that sell Medicare Supplement insurance to individuals through independent general agents and group retiree medical as well as other health insurance through brokers. The past acquisition of Evry Health supports additional incremental growth of our group health products. Due to the infancy of this business, we may experience volatility related to operating results as the business scales. The majority of the premium revenue in the United American Division comes from Medicare Supplement. Underwriting margin as a percent of premium for the Division was 4% for the six months ended June 30, 2026, unchanged for the same period in 2025.
The Family Heritage Division is an exclusive agency that primarily markets individual limited-benefit supplemental health insurance to small to medium-sized businesses. Most of its policies include a return of premium feature, where premium paid is returned less any claims paid to the policyholder at the end of a specified period stated within the insurance policy. Underwriting margin as a percent of premium was 36% for the six months ended June 30, 2026 and 35% for the same period in the prior year.
The Division experienced a 13% increase in health net sales as compared with the same six month period a year ago, primarily due to increased agent count and increased agent productivity. The Division will continue to implement incentive and retention programs to further these increases in the number of producing agents.
Below is the average producing agent count for the six months ended June 30, 2026 and 2025 for the Family Heritage Division. The average producing agent count is based on the actual count at the beginning and end of each week during the year.
At June 30,
Change
2026
2025
Amount
%
Family Heritage
1,585
1,458
127
9
The average producing agent count increased 9% compared with the same period a year ago. Along with the Division's increased efforts to grow agent count, it is also focused on the further training and development of its agency middle management. While growth in net sales and earned premium is impacted by agent productivity, growth in the number of producing agents is the primary driver of future growth in sales, similar to our other exclusive agencies.
The Liberty National Division represented 11% of all Globe Life health premium income for the six months ended June 30, 2026. The Liberty National Division markets limited-benefit supplemental health products, consisting primarily of cancer, critical illness, and accident insurance. Much of Liberty National's health business is generated through worksite marketing targeting small businesses. Health premium at the Liberty National Division was $95.0 million for the six months ended June 30, 2026 down slightly from $95.6 million for the same period in 2025. Liberty National's first-year collected premium declined slightly to $13.8 million in the six months ended June 30, 2026, compared with the same period in 2025. Health net sales for the six months ended June 30, 2026 fell 9% from the comparable period in 2025.
For the six months ended June 30, 2026, underwriting margin as a percent of premium was 51%, a decrease from the same period in the prior year. These declines reflect a greater emphasis toward the sale of life insurance products. While the agency will continue to focus on life sales, it is currently implementing updates to its sales presentation to reinvigorate health sales going forward.
While both the American Income Life Division and the Direct to Consumer Division sell life insurance, they also market health products. The American Income Life Division primarily markets accident plans. The Direct to Consumer Division primarily markets Medicare Supplement insurance to employer or union-sponsored groups. On a combined basis, these other channels accounted for 12% of health premium for the six months ended June 30, 2026 and 13% for the same period in 2025.
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Table of Contents
Globe Life Inc.
Management's Discussion & Analysis
INVESTMENTS
We manage our capital resources, including investments and cash flow, through the investment segment. Excess investment income represents the profit margin attributable to investment operations and is the measure that we use to evaluate the performance of the investment segment as described in Note 12—Business Segments. It is defined as net investment income less the required interest attributable to policy liabilities.
Our life and health insurance companies collect premium income from policyholders for the eventual payment of policyholder benefits, sometimes paid for many years or even decades in the future. Since benefits are expected to be paid in future periods, premium receipts in excess of current expenses are invested to provide for these obligations. Our core investment strategy is to primarily invest in high-quality fixed maturities containing an adequate yield to provide for the cost of carrying these long-term insurance product obligations. As a result, fixed maturities are generally held for long periods to support these obligations. Expected yields on these investments are taken into account when setting insurance premium rates and product profitability expectations. We also invest in commercial mortgage loans and other long-term investments to diversify risks and enhance risk-adjusted, capital-adjusted returns.
Management views excess investment income per diluted common share as an important and useful measure to evaluate the performance of the investment segment. It is defined as excess investment income divided by the total diluted weighted-average shares outstanding, representing the contribution by the investment segment to the consolidated earnings per share of the Company.
Excess Investment Income. The following table summarizes Globe Life's net investment income, excess investment income, and excess investment income per diluted common share.
Analysis of Excess Investment Income
(Dollar amounts in thousands, except for per share data)
Six Months Ended
June 30,
Change
2026
2025
Amount
%
Net investment income
$
583,644
$
562,783
$
20,861
4
Required interest on policy liabilities(1)
(508,675)
(492,085)
(16,590)
3
Excess investment income
$
74,969
$
70,698
$
4,271
6
Excess investment income per diluted share
$
0.94
$
0.85
$
0.09
11
Mean invested assets (at amortized cost)
$
21,905,981
$
21,494,647
$
411,334
2
Average insurance policy liabilities
18,453,302
17,727,143
726,159
4
(1)Required interest on policy liabilities, at original rates, is a component of total policyholder benefits, a GAAP measure.
Excess investment income increased $4 million, or 6%, compared with the year-ago period. Excess investment income per diluted common share was $0.94 for the six months ended June 30, 2026, an increase of 11% from the prior-year period. Excess investment income per diluted common share generally increases or decreases at a different pace than excess investment income because the number of diluted shares outstanding generally decreases from year to year as a result of our share repurchase program.
Net investment income for the six months ended June 30, 2026 was $584 million, or 4% greater than the prior year quarter period. Mean invested assets increased 2% during the first six months of 2026 over the same period last year. Net investment income increased in the current period due to higher earned yields on fixed maturities, commercial mortgage loans and other long-term investments compared to the prior year period. The effective annual yield earned on the fixed maturity portfolio was 5.31% in the first six months of 2026, compared to 5.27% for the comparable period in 2025. The earned yield on total long-term invested assets, which includes our fixed maturity, commercial mortgage loan and other long-term non-fixed maturity investments, was 5.51% for the first six months of 2026 compared to 5.38% for the comparable period of 2025.
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Globe Life Inc.
Management's Discussion & Analysis
While our core investments are fixed maturities, the Company also invests in commercial mortgage loans and limited partnerships with debt-like characteristics that diversify risk and enhance risk-adjusted, capital-adjusted returns on the portfolio. The earned yield on the Company's commercial mortgage loans for the six months ended June 30, 2026 was 7.20% compared with 5.62% in the prior-year period. The higher earned yield on commercial mortgage loans is due to a lower number of non-accrual loans in the first six months compared to the prior-year period. The earned yield on limited partnership investments for the six months ended June 30, 2026 was 8.06%, compared with 7.60% in the comparable prior-year period. See additional information in Note 4—Investments.
Globe Life's net investment income benefits from higher interest rates on new investments. While increasing interest rates have resulted in a net unrealized loss from our available-for-sale debt securities included in accumulated other comprehensive income (loss) as of June 30, 2026, we are not concerned because we do not generally intend to sell, nor is it likely that we will be required to sell, the fixed maturities prior to their anticipated recovery.
Required interest on insurance policy liabilities reduces excess investment income, as it is the amount of net investment income necessary to cover the interest-related growth on insurance policy liabilities. As such, it is reclassified from the insurance segment to the investment segment. As discussed in Note 12—Business Segments, management regards this as a more meaningful analysis of the investment and insurance segments. Required interest is based on the original discount rate assumptions for our insurance policies in force.
The vast majority of our life and health insurance policies are fixed interest rate protection policies, not investment products, and are accounted for under current GAAP accounting guidance for long-duration insurance products which mandates that interest rate assumptions for a particular block of business be “locked in” for the life of that block of business. Each calendar year, we set the original discount rate to be used to calculate the benefit reserve liability for all insurance policies issued that year. The liability reported on the Condensed Consolidated Balance Sheets is updated in subsequent periods using current discount rates as of the end of the relevant reporting period with a corresponding adjustment to other comprehensive income.
The discount rate used for policies issued in the current year has no impact on the in force policies issued in prior years, as the rates of all prior issue years are also locked in for purposes of recognizing income. As such, the overall original discount rate for the entire in force block of 5.5% is a weighted average of the discount rates being used from all issue years. Changes in the overall weighted-average discount rate over time are caused by changes in the mix of the reserves on the entire block of in force business. Business issued in the current year has little impact on the overall weighted-average original discount rate due to the size of our in force business.
In comparison to the year-ago period, required interest on insurance policy liabilities increased $17 million, or 3%, to $509 million, consistent with the 4% growth in average interest-bearing insurance policy liabilities.
Realized Gains and Losses. Despite our intent to hold fixed maturity investments for a long period of time, investments are occasionally sold, exchanged, called, or experience a credit loss event, resulting in a realized gain or loss. Gains or losses are only secondary to our core insurance operations of providing insurance coverage to policyholders. In a bond exchange offer, bondholders may consent to exchange their existing bonds for another class of debt securities. The Company also has investments in certain limited partnerships, held under the fair value option, with fair value changes recognized in "Realized gains (losses)" on the Condensed Consolidated Statements of Operations.
Realized gains and losses can be significant in relation to the earnings from core insurance operations, and as a result, can have a material positive or negative impact on net income. The significant fluctuations caused by gains and losses can cause period-to-period trends of net income that are not indicative of historical core operating results or predictive of the future trends of core operations. Accordingly, they have no bearing on core insurance operations or segment results as we view operations. For these reasons, and in line with industry practice, we remove the effects of realized gains and losses when evaluating overall insurance operating results.
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Globe Life Inc.
Management's Discussion & Analysis
The following table summarizes our tax-effected realized gains (losses) by component.
Analysis of Realized Gains (Losses), Net of Tax
(Dollar amounts in thousands, except for per share data)
Six Months Ended June 30,
2026
2025
Amount
Per Share
Amount
Per Share
Fixed maturities:
Sales
$
(385)
$
—
$
(4,262)
$
(0.05)
Matured or other redemptions(1)
1,765
0.02
(5,257)
(0.06)
Provision for credit losses
—
—
32
—
Fair value option—change in fair value
1,988
0.02
(4,823)
(0.06)
Mortgages
(198)
—
242
—
Other investments
(1,544)
(0.02)
(1,060)
(0.01)
Total realized gains (losses)—investments
1,626
0.02
(15,128)
(0.18)
Other gains (losses)(2)
2,846
0.04
521
0.01
Total realized gains (losses)
$
4,472
$
0.06
$
(14,607)
$
(0.17)
(1)During the six months ended June 30, 2026 and 2025, the Company recorded $29.0 million and $128.3 million, respectively, of exchanges of fixed maturity securities (noncash transactions) that resulted in net realized gains (losses) of $0 and $(2.5) million net of tax, respectively.
(2)Other realized gains (losses) are primarily a result of changes in the fair value for assets held in rabbi trust.
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Globe Life Inc.
Management's Discussion & Analysis
Investment Acquisitions. Globe Life's investment policy calls for a core investment strategy of investing primarily in investment grade fixed maturities that meet our quality and yield objectives. We generally invest in securities with longer-term maturities because they more closely match the long-term nature of our life and health policy liabilities. We believe this strategy is appropriate since our expected future cash flows are generally stable and predictable and the likelihood that we will need to sell invested assets to raise cash is low.
The following table summarizes selected information for fixed maturity investments. The effective annual yield shown is based on the acquisition price and call features, if any, of the securities. For non-callable bonds, the yield is calculated to maturity date. For callable bonds acquired at a premium, the yield is calculated to the earliest known call date and call price after acquisition ("first call date"). For all other callable bonds, the yield is calculated to maturity date.
Fixed Maturity Acquisitions Selected Information
(Dollar amounts in thousands)
Six Months Ended
June 30,
2026
2025
Cost of acquisitions:
Investment-grade corporate securities
$
679,338
$
479,578
Investment-grade municipal securities
85,984
18,228
Other securities
52,574
10,292
Total fixed maturity acquisitions(1)
$
817,896
$
508,098
Effective annual yield (one year compounded)(2)
6.25
%
6.43
%
Average life (in years, to next call)
36.6
35.8
Average life (in years, to maturity)
39.2
38.3
Average rating
A
A-
(1)Fixed maturity acquisitions included unsettled trades of $5 million in 2026 and $0 in 2025.
(2)Tax-equivalent basis, where the yield on tax-exempt securities is adjusted to produce a yield equivalent to the pretax yield on taxable securities.
For investments in callable bonds, the actual life of the investment will depend on whether the issuer calls the investment prior to the maturity date. Given our investments in callable bonds, the actual average life of our investments cannot be known at the time of the investment. Absent sales and "make-whole calls," however, the average life will not be less than the average life to next call and will not exceed the average life to maturity. Data for both of these average life measures is provided in the above chart.
During the first six months of 2026 and 2025, acquisitions consisted primarily of corporate and municipal bonds with securities spanning a diversified range of issuers, industry sectors, and geographical regions. In the first six months of 2026, we invested primarily in the industrial, financial, and utility sectors. For the entire portfolio, the taxable equivalent effective yield earned was 5.31%, up approximately 4 basis points from the yield in the first six months of 2025. The increase in taxable equivalent effective yield was primarily due to new purchases at yields exceeding the yield on dispositions and the average portfolio yield. For the remainder of 2026, the Company will continue to execute on its existing strategy by seeking to invest in assets that satisfy our quality and other objectives, while striving to maximize the risk-adjusted, capital-adjusted return.
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Table of Contents
Globe Life Inc.
Management's Discussion & Analysis
In addition to the fixed maturity acquisitions, Globe Life invested in commercial mortgage loans and in other long-term investments. See Note—4 Investments for further discussion.
The following table summarizes Globe Life's other investment acquisitions of the following assets.
Other Investment Acquisitions
(Dollar amounts in thousands)
Six Months Ended
June 30,
2026
2025
Commercial mortgage loans:
Directly held
$
83,698
$
66,836
Limited partnerships
38,392
25,103
Total commercial mortgage loans
122,090
91,939
Other long-term investments:
Limited partnerships
36,789
27,713
Company-owned life insurance
75,000
—
Total other long-term investments
111,789
27,713
Common stock
3,914
1,844
Total
$
237,793
$
121,496
Since fixed maturities represent such a significant portion of our investment portfolio, 87% of total amortized cost, net of allowance for credit losses, at June 30, 2026, the remainder of the discussion of portfolio composition will focus on fixed maturities. Selected information concerning the fixed maturity portfolio is as follows:
Fixed Maturity Portfolio Selected Information
At
June 30,
2026
December 31, 2025
June 30,
2025
Average annual effective yield(1)
5.31%
5.29%
5.26%
Average life, in years, to:
Next call(2)
15.8
15.2
15.3
Maturity(2)
20.0
19.4
19.5
Effective duration to:
Next call(2,3)
8.7
8.7
8.8
Maturity(2,3)
10.6
10.5
10.5
(1)Weighted average annual effective yield as of the end of the period, on a tax-equivalent basis. The yield on tax-exempt securities is adjusted to produce a yield equivalent to the pretax yield on taxable securities.
(2)Globe Life calculates the average life and duration of the fixed maturity portfolio two ways:
(a) based on the next call date which is the next call date for callable bonds and the maturity date for non-callable bonds; and
(b) based on the maturity date of all bonds, whether callable or not.
(3)Effective duration is a measure of the price sensitivity of a fixed-income security to a 1% change in interest rates.
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Globe Life Inc.
Management's Discussion & Analysis
Credit Risk Sensitivity. The following tables summarize certain information about the major corporate sectors and security types held in our fixed maturity portfolio at June 30, 2026 and December 31, 2025.
Fixed Maturities by Sector
June 30, 2026
(Dollar amounts in thousands)
Below Investment Grade
Total Fixed Maturities
% of Total
Fixed Maturities
Amortized
Cost, net
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair
Value
Amortized
Cost, net
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair
Value
At Amortized Cost, net
At Fair Value
Corporates:
Financial
Insurance - life, health, P&C
$
7,957
$
33
$
—
$
7,990
$
2,933,102
$
52,435
$
(194,137)
$
2,791,400
15
15
Banks
60,189
204
(1,189)
59,204
959,080
24,491
(39,011)
944,560
5
5
Other financial
74,976
—
(13,854)
61,122
1,159,418
16,047
(134,338)
1,041,127
6
6
Total financial
143,122
237
(15,043)
128,316
5,051,600
92,973
(367,486)
4,777,087
26
26
Industrial
Energy
44,459
46
(3,555)
40,950
1,312,434
42,789
(58,026)
1,297,197
7
7
Basic materials
41,642
—
(8,329)
33,313
1,117,053
24,595
(87,680)
1,053,968
6
6
Consumer, non-cyclical
—
—
—
—
2,252,483
18,886
(222,673)
2,048,696
12
11
Other industrials
25,000
—
(4,571)
20,429
1,124,651
22,412
(82,419)
1,064,644
6
6
Communications
20,112
245
(3,382)
16,975
854,889
12,419
(87,425)
779,883
4
4
Transportation
—
—
—
—
657,495
15,523
(30,637)
642,381
3
4
Consumer, cyclical
88,943
—
(23,237)
65,706
350,368
5,026
(47,034)
308,360
2
2
Technology
50,265
86
(60)
50,291
345,696
200
(69,104)
276,792
2
2
Total industrial
270,421
377
(43,134)
227,664
8,015,069
141,850
(684,998)
7,471,921
42
42
Utilities
57,384
—
(6,759)
50,625
2,202,223
52,705
(103,774)
2,151,154
11
12
Total corporates
470,927
614
(64,936)
406,605
15,268,892
287,528
(1,156,258)
14,400,162
79
80
States, municipalities, and political divisions:
General obligations
—
—
—
—
908,820
4,524
(159,396)
753,948
5
4
Revenues
1,959
—
(163)
1,796
2,516,218
18,341
(320,483)
2,214,076
13
13
Total states, municipalities, and political divisions
1,959
—
(163)
1,796
3,425,038
22,865
(479,879)
2,968,024
18
17
Other fixed maturities:
Government (U.S. and foreign)
—
—
—
—
464,427
334
(38,796)
425,965
2
2
Other asset-backed securities
42,930
206
—
43,136
145,641
565
(168)
146,038
1
1
Total fixed maturities
$
515,816
$
820
$
(65,099)
$
451,537
$
19,303,998
$
311,292
$
(1,675,101)
$
17,940,189
100
100
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GL Q2 2026 FORM 10-Q
Table of Contents
Globe Life Inc.
Management's Discussion & Analysis
Fixed Maturities by Sector
December 31, 2025
(Dollar amounts in thousands)
Below Investment Grade
Total Fixed Maturities
% of Total
Fixed Maturities
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair
Value
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair
Value
At Amortized Cost, net
At Fair Value
Corporates:
Financial
Insurance - life, health, P&C
$
7,978
$
119
$
—
$
8,097
$
2,898,137
$
80,468
$
(175,533)
$
2,803,072
16
16
Banks
60,268
278
(2,738)
57,808
916,529
31,873
(37,643)
910,759
5
5
Other financial
74,975
—
(7,670)
67,305
1,167,521
21,764
(120,790)
1,068,495
6
6
Total financial
143,221
397
(10,408)
133,210
4,982,187
134,105
(333,966)
4,782,326
27
27
Industrial
Energy
44,500
55
(3,120)
41,435
1,313,734
50,113
(56,624)
1,307,223
7
7
Basic materials
41,620
—
(9,835)
31,785
1,116,746
29,964
(91,011)
1,055,699
6
6
Consumer, non-cyclical
—
—
—
—
2,092,995
23,547
(198,498)
1,918,044
11
11
Other industrials
25,000
—
(4,187)
20,813
1,096,807
27,723
(78,215)
1,046,315
6
6
Communications
20,258
263
(3,709)
16,812
800,452
16,981
(80,227)
737,206
4
4
Transportation
—
—
—
—
618,817
15,863
(30,939)
603,741
3
4
Consumer, cyclical
104,813
133
(19,375)
85,571
407,404
6,353
(44,746)
369,011
2
2
Technology
50,270
3,545
—
53,815
340,930
4,620
(65,103)
280,447
2
2
Total industrial
286,461
3,996
(40,226)
250,231
7,787,885
175,164
(645,363)
7,317,686
41
42
Utilities
58,199
110
(6,118)
52,191
2,093,010
71,582
(93,086)
2,071,506
11
12
Total corporates
487,881
4,503
(56,752)
435,632
14,863,082
380,851
(1,072,415)
14,171,518
79
81
States, municipalities, and political divisions:
General obligations
—
—
—
—
917,006
5,961
(179,707)
743,260
5
4
Revenues
1,961
—
(210)
1,751
2,468,427
20,994
(352,055)
2,137,366
13
12
Total states, municipalities, and political divisions
1,961
—
(210)
1,751
3,385,433
26,955
(531,762)
2,880,626
18
16
Other fixed maturities:
Government (U.S., municipal, and foreign)
—
—
—
—
456,618
299
(33,518)
423,399
2
2
Other asset-backed securities
31,490
136
—
31,626
112,034
1,877
(112)
113,799
1
1
Total fixed maturities
$
521,332
$
4,639
$
(56,962)
$
469,009
$
18,817,167
$
409,982
$
(1,637,807)
$
17,589,342
100
100
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Table of Contents
Globe Life Inc.
Management's Discussion & Analysis
Corporate securities, which consist of bonds and redeemable preferred stocks, were the largest component of the fixed-maturity portfolio as of June 30, 2026, representing 79% of amortized cost, net, and 80% of fair value. The remainder of the portfolio is invested primarily in securities issued by the U.S. government and U.S. municipalities. The Company holds insignificant amounts in foreign government bonds, asset-backed securities, and mortgage-backed securities. Corporate securities are diversified over a variety of industry sectors and issuers. At June 30, 2026, the total fixed maturity portfolio consisted of 1,013 issuers.
Fixed maturities had a fair value of $17.9 billion at June 30, 2026, compared to $17.6 billion at December 31, 2025. The net unrealized loss position in the fixed-maturity portfolio increased from $1.2 billion at December 31, 2025 to $1.4 billion at June 30, 2026 due to a change in market rates during the period.
For more information about our fixed-maturity portfolio by component at June 30, 2026 and December 31, 2025, including a discussion of allowance for credit losses, an analysis of unrealized investment losses, and a schedule of maturities, see Note 4—Investments.
An analysis of the fixed-maturity portfolio by composite quality rating at June 30, 2026 and December 31, 2025, is shown in the following tables. The company uses the NAIC designation for credit quality ratings. The NAIC designation is generally determined using the second lowest rating available from nationally recognized statistical rating organizations (“NRSRO”) when three or more ratings are available and the lowest rating when two or fewer rating are available. When NRSRO ratings are unavailable the rating may be assigned by the Securities Valuation Office (“SVO”) of the NAIC.
Fixed Maturities by Rating
At June 30, 2026
(Dollar amounts in thousands)
Amortized Cost, net
% of Total
Fair
Value
% of Total
Average Composite Quality Rating on Amortized Cost, net
Investment grade:
AAA
$
980,270
5
$
898,015
5
AA
3,617,026
18
3,128,933
17
A
6,368,204
33
6,037,740
34
BBB+
3,302,170
17
3,144,228
18
BBB
3,441,448
18
3,274,277
18
BBB-
1,079,064
6
1,005,459
5
Total investment grade
18,788,182
97
17,488,652
97
A
Below investment grade:
BB
416,132
2
373,487
2
B
95,527
1
74,056
1
Below B
4,157
—
3,994
—
Total below investment grade
515,816
3
451,537
3
BB
$
19,303,998
100
$
17,940,189
100
Weighted average composite quality rating
A-
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Globe Life Inc.
Management's Discussion & Analysis
Fixed Maturities by Rating
At December 31, 2025
(Dollar amounts in thousands)
Amortized
Cost, net
% of Total
Fair
Value
% of Total
Average Composite Quality Rating on Amortized Cost
Investment grade:
AAA
$
955,561
5
$
872,139
5
AA
3,455,082
18
2,941,349
16
A
6,016,228
32
5,778,006
33
BBB+
3,133,353
17
3,007,623
17
BBB
3,717,938
20
3,554,535
20
BBB-
1,017,673
5
966,681
6
Total investment grade
18,295,835
97
17,120,333
97
A
Below investment grade:
BB
452,809
3
410,286
3
B
64,364
—
54,774
—
Below B
4,159
—
3,949
—
Total below investment grade
521,332
3
469,009
3
BB
$
18,817,167
100
$
17,589,342
100
Weighted average composite quality rating
A-
The overall quality rating of the portfolio is A-, the same as of year-end 2025. Fixed maturities rated BBB are 41% of the total portfolio at June 30, 2026, down from 42% at December 31, 2025. While this ratio may be high relative to our peers, it is at its lowest level since 2003 and we have limited exposure to higher-risk assets such as derivatives, equities, and asset-backed securities. Additionally, the Company does not participate in securities lending and has no off-balance sheet investments as of June 30, 2026. Of our fixed maturity purchases, BBB securities generally provide the Company with the best risk-adjusted, capital-adjusted returns largely due to our ability to hold securities to maturity regardless of fluctuations in interest rates or equity markets. Our allocation to BBB rated bonds has decreased over the past few years as we have found better risk-adjusted, capital-adjusted value in higher-rated bonds.
An analysis of changes in our portfolio of below-investment grade fixed maturities at amortized cost, net of allowance for credit losses, is as follows:
Below-Investment Grade Fixed Maturities
(Dollar amounts in thousands)
Six Months Ended June 30,
2026
2025
Balance at beginning of period
$
521,332
$
529,120
Downgrades by rating agencies
—
65,627
Upgrades by rating agencies
—
(30,565)
Dispositions
(17,561)
(65,513)
Acquisitions
11,439
6,893
Provision for credit losses
—
40
Amortization and other
606
(2,780)
Balance at end of period
$
515,816
$
502,822
Our investment policy calls for investing primarily in fixed maturities that are investment grade and meet our quality and yield objectives. Thus, the balance of below-investment grade issues is primarily the result of ratings downgrades of existing holdings. Below-investment grade bonds at amortized cost, net of allowance for credit losses, were 3% of total fixed maturities at amortized cost as of June 30, 2026.
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Globe Life Inc.
Management's Discussion & Analysis
OPERATING EXPENSES
Operating expenses are classified into two categories: insurance administrative expenses and expenses of the Parent Company. Insurance administrative expenses generally include expenses incurred after a policy has been issued. As these expenses relate to premium for a given period, management measures the expenses as a percentage of premium income. The Company also views stock-based compensation expense as a Parent Company expense. Expenses associated with the issuance of our insurance policies are reflected as acquisition expenses and included in the determination of underwriting margin.
An analysis of operating expenses is shown below.
Operating Expenses Selected Information
(Dollar amounts in thousands)
Six Months Ended June 30,
Increase
2026
2025
(Decrease)
Amount
% of
Premium
Amount
% of
Premium
Amount
%
Insurance administrative expenses:
Salaries
$
69,719
2.7
$
68,365
2.8
$
1,354
2
Other employee costs
22,279
0.9
19,708
0.8
2,571
13
Information technology costs
46,479
1.8
40,491
1.7
5,988
15
Legal costs
7,109
0.3
12,076
0.5
(4,967)
(41)
Other administrative costs
40,146
1.5
32,956
1.4
7,190
22
Total insurance administrative expenses
185,732
7.2
173,596
7.2
12,136
7
Parent company expense
8,102
6,605
1,497
Stock compensation expense
30,577
26,062
4,515
Legal proceedings
5,484
10,776
(5,292)
Other expenses
91
—
91
Total operating expenses, per Condensed Consolidated Statements of Operations
$
229,986
$
217,039
$
12,947
6
Total operating expenses for June 30, 2026 increased in comparison with the prior year primarily due to increases in insurance administrative expenses. Insurance administrative expenses increased $12 million primarily due to higher information technology costs in addition to employee costs, which include salaries and other costs. Insurance administrative expenses as a percent of premium were 7.2% for the six months ended June 30, 2026 and 2025.
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Globe Life Inc.
Management's Discussion & Analysis
SHARE REPURCHASES
Globe Life has an ongoing share repurchase program that began in 1986. The share repurchase program is reviewed with the Board of Directors quarterly, and continues indefinitely unless and until the Board of Directors decides to suspend, terminate or modify the program. On November 18, 2024, the Board of Directors authorized the repurchase of up to $1.8 billion under the Company's existing share repurchase program. Management generally determines the amount of repurchases based on the amount of excess cash flows and other available sources after the payment of dividends to the Parent Company shareholders, general market conditions, and other alternative uses. At June 30, 2026, we had $736 million remaining under the original authorization to repurchase.
Since implementing our share repurchase program in 1986, we have used $11.4 billion to repurchase Globe Life Inc. common shares, after determining that the repurchases provide a greater risk-adjusted after-tax return than other alternatives and we expect to continue this program into the future.
Excess cash flow at the Parent Company is primarily comprised of dividends received from the insurance subsidiaries less interest expense paid on its debt and other limited operating activities. Additionally, when stock options are exercised, proceeds from these exercises and the resulting tax benefit are used to repurchase additional shares on the open market to minimize dilution as a result of the option exercises. Share repurchases were made in the current period with anticipation of the expected cashflows for the year.
The following table summarizes share repurchases for the six month periods ended June 30, 2026 and 2025.
Analysis of Share Repurchases
(Amounts in thousands, except per share data)
Six Months Ended June 30,
2026
2025
Purchases with:
Shares
Amount
Average
Price
Shares
Amount
Average
Price
Excess cash flow at the Parent Company(1)
2,575
$
378,474
$
146.99
3,317
$
402,603
$
121.38
Option exercise proceeds
851
133,769
157.15
881
108,598
123.27
Total
3,426
$
512,243
$
149.51
4,198
$
511,201
$
121.78
(1)Excludes excise tax on the repurchase of treasury stock of $3.1 million and $3.7 million for the six months ended June 30, 2026 and 2025, respectively.
FINANCIAL CONDITION
Liquidity. Liquidity provides Globe Life with the ability to meet on demand the cash commitments required to support our business operations and meet our financial obligations. Our liquidity is primarily derived from multiple sources: positive cash flow from operations, a portfolio of marketable securities, pre-capitalized trust securities facility, a revolving credit facility, commercial paper, and advances from the Federal Home Loan Bank.
Insurance Subsidiary Liquidity. The operations of our insurance subsidiaries have historically generated substantial cash inflows in excess of immediate cash needs. Cash inflows for the insurance subsidiaries primarily include premium and investment income. In addition to investment income, maturities and scheduled repayments in the investment portfolio are cash inflows. Cash outflows from operations include policy benefit payments, commissions, administrative expenses, and taxes. A portion of cash inflows in the current year will provide for the payment of future policy benefits and are invested primarily in long-term fixed maturities as they better match the long-term nature of these obligations. While the insurance subsidiaries annually generate more operating cash inflows than cash outflows, the companies also have the entire available-for-sale fixed-maturity portfolio available to create additional cash flows if required.
Four of our insurance subsidiaries are members of the FHLB of Dallas. FHLB membership provides the insurance subsidiaries with access to various low-cost collateralized borrowings and funding agreements. While not the only source of liquidity, the FHLB could provide the insurance subsidiaries with an additional source of liquidity, if needed. Refer to Note 11—Debt for further details.
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Globe Life Inc.
Management's Discussion & Analysis
Parent Company Liquidity. An important source of Parent Company liquidity is the dividends from its insurance subsidiaries. These dividends are received throughout the year and are used by the Parent Company to pay dividends on common and preferred stock, interest and principal repayment requirements on Parent Company debt, and operating expenses of the Parent Company.
Six Months Ended
June 30,
Twelve Months Ended
December 31,
2026
2025
Projected 2026
2025
Liquidity Sources:
Dividends from Subsidiaries
$
372,379
$
351,394
$700,000—$740,000
$
815,741
Excess Cash Flows(1)
321,986
474,953
650,000—700,000
890,311
(1)Excess cash flows are reported gross of shareholder dividends. For the six months ended June 30, 2026 and 2025, shareholder dividends were $47 million and $43 million, respectively. For the twelve months ended December 31, 2026, we project approximately $95 million in shareholder dividends, compared to the $86 million paid in 2025.
Subsidiary dividends are generally paid in amounts equal to the subsidiaries’ prior year statutory net income excluding net realized capital gains. Additional sources of liquidity for the Parent Company are cash, intercompany receivables, intercompany borrowings, debt markets, term loans, and a revolving credit facility.
The Company has access to a P-CAP Facility Agreement that provides us with the right to sell at any time to the Trust up to $500 million of our 6.580% Senior Notes due 2055 (the “6.580% Senior Notes”) in exchange for a corresponding amount of the Strips held by the Trust (the “Issuance Right”). Our capacity under the agreement is based on the value of the Strips which was $493 million as of June 30, 2026. We agreed to pay a semi-annual facility fee of 1.789% per annum on the unexercised portion of the Issuance Right.
The Company can redeem the 6.580% Senior Notes at any time, in whole or in part, at a price equal to the greater of par or a make-whole redemption price. At June 30, 2026, the Company had no senior note issuances under the Facility Agreement.
Short-Term Borrowings. An additional source of Parent Company liquidity is a credit facility with a group of lenders. The five-year credit agreement was amended on June 26, 2026, resulting in an extended maturity date of June 26, 3031. The facility allows for unsecured borrowings and stand-by letters of credit up to $1 billion, which could be increased up to $1.25 billion. While the Parent Company may request the increase, it is not guaranteed. Up to $250 million in letters of credit can be issued against the facility. The facility serves as a backup line of credit for a commercial paper program under which commercial paper may be issued at any time, with total commercial paper outstanding not to exceed the facility maximum less any letters of credit issued.
Interest charged on the commercial paper program resembles variable rate debt due to its short term nature. As of June 30, 2026, we had available $606 million of additional borrowing capacity under this facility, compared to $488 million a year earlier. As of June 30, 2026, the Parent Company was in full compliance with all covenants related to the aforementioned debt.
As a part of the credit facility, Globe Life has stand-by letters of credit. These letters of credit are issued on behalf of our insurance subsidiaries.
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Globe Life Inc.
Management's Discussion & Analysis
The following tables present certain information about our commercial paper borrowings.
Credit Facility—Commercial Paper
(Dollar amounts in thousands)
At
June 30,
2026
December 31, 2025
June 30,
2025
Balance of commercial paper at end of period (par value)
$
279,000
$
306,000
$
397,000
Annualized interest rate
4.07
%
4.05
%
4.73
%
Letters of credit outstanding
$
115,000
$
115,000
$
115,000
Remaining amount available under credit line
$
606,000
$
579,000
$
488,000
Credit Facility—Commercial Paper Activity
(Dollar amounts in thousands)
Six Months Ended June 30,
2026
2025
Average balance of commercial paper outstanding during period (par value)
$
395,242
$
456,181
Daily-weighted average interest rate (annualized)
4.02
%
4.99
%
Maximum daily amount outstanding during period (par value)
$
559,250
$
605,500
The Company reduced commercial paper borrowings by $27 million since year end.
T6The Parent Company expects to have readily available funds for 2026 and the foreseeable future to conduct its operations and to maintain target capital ratios in the insurance subsidiaries. In the unlikely event that more liquidity is needed, the Company could generate additional funds through multiple sources including, but not limited to the issuance of debt and intercompany borrowings. The Parent Company had access to $113 million of liquid assets available as of June 30, 2026. This liquidity is available to the Company in the event additional funds are needed to support the targeted capital levels within our insurance subsidiaries.
Consolidated Liquidity. Consolidated net cash inflows from operations were $735 million in the six months ended June 30, 2026, compared with $740 million in the same period of 2025. The decrease is attributable to routine fluctuations in the settlement of operating activities. In addition to cash inflows from operations, our insurance companies received proceeds from dispositions of fixed maturities available for sale, mortgage loans, and other long-term investments in the amount of $454 million during the six months ended June 30, 2026. The Parent Company has in place a revolving credit facility and a P-CAPS facility. See Note 11—Debt for further details. The insurance companies have no additional outstanding credit facilities.
Cash and short-term investments were $455 million at June 30, 2026, compared with $459 million at December 31, 2025. In addition to these liquid assets, $18 billion (fair value at June 30, 2026) of fixed income securities are available for sale in the event of an unexpected need. Approximately $1.7 billion, at fair value, is pledged for outstanding FHLB advances and reinsurance. Further, approximately 98% of our fixed income securities are publicly traded, freely tradable under SEC Rule 144, or qualified for resale under SEC Rule 144A. While our fixed income securities are classified as available for sale, we have the ability and general intent to hold any securities to recovery or maturity.
Our strong cash flows from operations, on-going investment maturities, and available liquidity under our credit facility, FHLB and P-CAPS facility make any need to sell securities for liquidity highly unlikely.
Capital Resources. The Parent Company's capital structure consists of short-term debt (the commercial paper facility and current maturities of long-term debt), long-term debt, and shareholders’ equity. It does not include short-term FHLB borrowings, which are obligations of the insurance subsidiaries and typically repaid over the course of the year.
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GLOBE LIFE INC.
Management's Discussion & Analysis
Long-Term Borrowings. At June 30, 2026, the outstanding long-term debt at book value was $2.7 billion compared with $2.3 billion at December 31, 2025.
Selected Information about Debt Issues
As of June 30, 2026
(Dollar amounts in thousands)
Instrument
Issue Date
Maturity Date
Coupon Rate
Interest Payment Dates
Par
Value
Book
Value
Fair
Value
Senior notes
09/27/2018
09/15/2028
4.550%
semiannual
$
550,000
$
548,141
$
548,762
Senior notes
08/21/2020
08/15/2030
2.150%
semiannual
400,000
397,846
360,952
Senior notes(1)
05/19/2022
06/15/2032
4.800%
semiannual
400,000
392,427
394,428
Senior notes
08/23/2024
09/15/2034
5.850%
semiannual
450,000
445,433
464,247
Junior subordinated debentures
11/17/2017
11/17/2057
5.275%
semiannual
125,000
123,470
92,299
Junior subordinated debentures
06/14/2021
06/15/2061
4.250%
quarterly
325,000
317,516
197,600
Term loan(2)
05/11/2023
06/26/2029
5.116%
quarterly
450,000
446,648
446,648
Subtotal
2,700,000
2,671,481
2,504,936
Unamortized issuance costs(3)
—
(6,185)
—
Total long-term debt
2,700,000
2,665,296
2,504,936
Commercial paper
279,000
277,953
277,953
Total short-term debt
279,000
277,953
277,953
Total debt
$
2,979,000
$
2,943,249
$
2,782,889
(1)The $150 million 4.80% Senior Notes, previously held by two insurance subsidiaries, were sold and issued to a third party at a discount of $4.2 million during the quarter ended June 30, 2026.
(2)The term loan was amended and restated on June 26, 2026 extending the maturity date from August 15, 2027 to June 26, 2029 and increasing the principal amount from $250 million to $450 million.
(3)Unamortized issuance costs for P-CAPS facility agreement.
Financing costs consist primarily of interest on our various debt instruments. The table below presents the components of financing costs and reconciles interest expense per the Condensed Consolidated Statements of Operations.
Analysis of Financing Costs
(Dollar amounts in thousands)
Six Months Ended
June 30,
Increase
(Decrease)
2026
2025
Amount
%
Interest on funded debt
$
48,236
$
47,179
$
1,057
2
Interest on term loans
6,869
7,674
(805)
(10)
Interest on short-term debt
10,328
15,011
(4,683)
(31)
Other
4,617
13
4,604
Financing costs
$
70,050
$
69,877
$
173
—
During the first six months of 2026, financing costs were flat compared to the prior year. More information on our debt transactions is disclosed in the Financial Condition section of this report.
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GLOBE LIFE INC.
Management's Discussion & Analysis
Subsidiary Capital: The National Association of Insurance Commissioners has established a risk-based factor approach for determining threshold risk-based capital levels for all U.S. insurance companies. This approach was designed to assist the regulatory bodies in identifying companies that may require regulatory attention. A Risk-Based Capital ratio is typically calculated by dividing adjusted total statutory capital by the amount of RBC determined using the NAIC’s factors.
If a company’s RBC ratio approaches two times the RBC amount, the company must file a plan with the NAIC for improving its capital levels (this level is commonly referred to as “Company Action Level” RBC). Companies typically hold a multiple of the Company Action Level RBC depending on their particular business needs and risk profile.
Our goal is to maintain statutory capital within our insurance subsidiaries at levels necessary to support our current ratings. Globe Life targets a consolidated Company Action Level RBC ratio of 300% to 320% for our U.S. insurance subsidiaries. The Company has concluded that this capital level is more than adequate and sufficient to support its current ratings, given the nature of its business and its risk profile. For 2025, our consolidated Company Action Level RBC ratio was 316%. The Parent Company is committed to maintaining the targeted consolidated RBC ratio at its insurance subsidiaries and has sufficient liquidity available to provide additional capital if necessary.
In addition, our Bermuda-based insurance subsidiaries are subject to regulation in Bermuda. The Bermuda Monetary Authority ("BMA") has capital requirements and solvency standards including limitations on dividends or distributions to shareholders. Our Bermuda subsidiaries' level of capitalization exceeded the required minimum solvency margins for the year ended 2025.
Shareholders' Equity: Shareholders’ equity was $6.2 billion at June 30, 2026. This compares with $6.0 billion at December 31, 2025 and $5.4 billion at June 30, 2025. During the six months since December 31, 2025, shareholders’ equity increased as a result of net income of $558 million during the first six months of 2026, but was offset by share repurchases of $378 million and an additional $134 million in share repurchases to offset the dilution from stock option exercises. Additionally, the change in the balance of AOCI increased shareholders' equity $50 million primarily due to changes in interest rates and discount rates over the period.
On April 30, 2026, the Parent Company announced that it had declared a quarterly dividend of $0.33 per share, an increase of 22% from the previous amount of $0.27 per share. This dividend was paid on July 31, 2026.
We plan to use excess cash available at the Parent Company as efficiently as possible in the future. Excess cash flow, as we define it, results primarily from the dividends received by the Parent Company from its insurance subsidiaries less the interest paid on debt. The cash received by the Parent Company from our insurance subsidiaries is after they have made substantial investments during the year to grow the business. Possible uses of excess cash flow include, but are not limited to, share repurchases, acquisitions, shareholder dividend payments, subsidiary capital contributions, investments in securities, or repayment of short-term debt. We will determine the best use of excess cash after ensuring that targeted capital levels are maintained in our insurance subsidiaries. If market conditions are favorable, we currently expect that share repurchases will continue to be a primary use of those funds.
Future policy benefits are computed using current discount rates with the impact of changes in discount rates included in accumulated other comprehensive income. Additionally, the liability for future policy benefits is calculated using net premiums rather than gross premiums. Given that gross premiums are considerably higher than net premiums for our business, as seen in Note 6—Policy Liabilities, the measurement of the liability is higher than what it would be had it been computed using gross premiums. This is an important consideration when analyzing shareholders' equity.
We maintain a significant available-for-sale fixed maturity portfolio to support our insurance policy liabilities. Current accounting guidance requires that we revalue our portfolio to fair market value at the end of each accounting period. The period-to-period changes in fair value, net of their associated impact on income tax, are reflected directly in shareholders’ equity in AOCI. Changes in the fair value of the portfolio can result from changes in market rates.
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GLOBE LIFE INC.
Management's Discussion & Analysis
While a majority of invested assets are revalued, accounting rules do not permit interest-bearing insurance policy liabilities to be valued at fair value in a consistent manner as that of assets, with changes in value applied directly to shareholders’ equity. Due to the size of our policy liabilities in relation to our shareholders’ equity, an inconsistency exists in measurement, which may have a material impact on the reported value of shareholders’ equity. Fluctuations in interest rates cause undue volatility in the period-to-period presentation of our shareholders’ equity, capital structure, and financial ratios. Due to the long-term nature of our fixed maturity investments and liabilities and the strong cash flows consistently generated by our insurance subsidiaries, we have the ability to hold our securities to maturity.
As such, we do not expect to incur losses due to fluctuations in market value of fixed maturities caused by market rate changes and temporarily illiquid markets. Accordingly, our management, credit rating agencies, lenders, many industry analysts, and certain other financial statement users prefer to remove the effects of AOCI when analyzing our balance sheet, capital structure, and financial ratios.
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Mentions · how they’re counted
| Category | Underlined | Word counter | Model’s count |
|---|---|---|---|
| AI AI, artificial intelligence, generative AI, machine learning, large language model, LLM | 3 | 3 | 2 |
| Layoffs layoffs, RIF, headcount reduction, workforce optimization, restructuring | 0 | — | 0 |
| Recession recession, downturn, contraction, slowdown | 0 | 0 | 0 |
| Tariffs tariff, trade war, trade barriers, trade restrictions, trade policy | 0 | 0 | 0 |
| Buybacks share repurchase, buyback program | 14 | — | 5 |
Underlines use the same word lists the scores use. AI, recession and tariffs follow Palanor’s word counter, so those counts match it exactly on the same text. Layoffs and buybacks use the terms the model was given. The model’s count is an estimate by meaning, not by string, so it can differ from the underlines.
Not placed in the text
These quotes are stored with a score, but no passage here matches them closely enough to highlight. Rather than point at the wrong passage, they are listed as stored.
Theme · Premium and sales growth
“Total premium increased 6% over the same period in the prior year. Total net sales increased 10% over the same period in the prior year.”
Source: SEC EDGAR · public domain · Highlights by Palanor