Core Viewpoint - Investors with significant losses in Lincoln National Corporation have the opportunity to lead a securities fraud class action lawsuit against the company, with a class period from November 4, 2020, to November 2, 2022, and a lead plaintiff deadline of June 24, 2024 [1] Group 1: Allegations Against Lincoln National - The complaint alleges that during the class period, the company failed to disclose a decline in its Variable Universal Life (VUL) business [2] - It is claimed that the goodwill associated with the life insurance business was overstated as a result of this decline [2] - The company's policy lapse assumptions were outdated, leading to overstated reserves [2] - The financial results and statements reported by the company were misstated due to the aforementioned issues [2] - Positive statements made by the defendants regarding the company's business and prospects were materially misleading and lacked a reasonable basis [2]

Group 1 - A class action lawsuit has been filed against Lincoln National Corporation for alleged securities fraud and unlawful business practices [2] - The lawsuit allows shareholders who purchased Lincoln National securities during the Class Period to apply as Lead Plaintiff by June 24, 2024 [2] - Lincoln National reported a net loss of $2.6 billion for Q3 2022, a significant decline from a net income of $318 million in Q3 2021, attributed to unfavorable notable items and a goodwill impairment [2] Group 2 - Following the release of its Q3 2022 financial results, Lincoln National's stock price dropped by $17.27 per share, or 33.2%, closing at $34.83 per share [2] - Pomerantz LLP is recognized as a leading firm in corporate, securities, and antitrust class litigation, with a history of recovering billions in damages for class members [3]

Core Insights - Lincoln National Corporation (LNC) has launched Lincoln MoneyGuard Market Advantage to meet the growing customer demand for flexibility and growth in long-term care solutions [1][2] - The new product aims to enhance LNC's offerings by providing care protection, increased investment options, and flexibility for consumers [1][4] Product Features - The MoneyGuard solution offers over 50 investment options and allows consumers to choose between indemnity and reimbursement payment methods [3] - Under the indemnity option, consumers can receive up to 80% of a pre-decided monthly payment, while reimbursement covers qualified expenses [3] Market Position and Performance - LNC's shares have increased by 51.7% over the past year, outperforming the industry average growth of 24.7% [4] - The company is positioned to attract more clients and improve its revenue through the introduction of flexible long-term care solutions [2][4]

Shares of Lincoln National Corporation (LNC) rose 1.5% since it reported first-quarter 2024 results on May 2, 2024. The quarterly earnings benefited on the back of solid contributions from the Group Protection business, positive flows in the Retirement Plan Services unit and lower expenses. However, the upside was partly offset by declining fee income and net investment income. Poor performance in the Life Insurance business continues to harm LNC’s results.LNC reported first-quarter 2024 adjusted earnings o ...

[PART I – FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents Lincoln National Corporation's unaudited consolidated financial information for Q1 2024 and 2023 [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents Lincoln National Corporation's unaudited consolidated financial statements for the three months ended March 31, 2024, and 2023, including balance sheets, statements of comprehensive income (loss), stockholders' equity, and cash flows, along with detailed notes covering operations, accounting standards, investments, derivatives, reinsurance, and segment information [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20March%2031%2C%202024%20(Unaudited)%20and%20December%2031%2C%202023) This section details the company's financial position, including assets, liabilities, and equity, as of March 31, 2024, and December 31, 2023 Consolidated Balance Sheets (Millions USD) | Metric | March 31, 2024 (Millions USD) | December 31, 2023 (Millions USD) | | :------------------------------------------------ | :----------------------------- | :----------------------------- | | **ASSETS** | | | | Total investments | 125,702 | 124,331 | | Cash and invested cash | 4,122 | 3,365 | | Separate account assets | 166,225 | 158,257 | | Total assets | 383,381 | 372,413 | | **LIABILITIES** | | | | Policyholder account balances | 122,300 | 120,737 | | Future contract benefits | 38,848 | 39,864 | | Separate account liabilities | 166,225 | 158,257 | | Total liabilities | 375,835 | 365,520 | | **STOCKHOLDERS' EQUITY** | | | | Total stockholders' equity | 7,546 | 6,893 | | Total liabilities and stockholders' equity | 383,381 | 372,413 | - Total assets increased by **$10.968 billion (2.9%)** from December 31, 2023, to March 31, 2024, primarily driven by increases in separate account assets and total investments[9](index=9&type=chunk) - Total stockholders' equity increased by **$653 million (9.5%)** from December 31, 2023, to March 31, 2024[10](index=10&type=chunk) [Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)%20for%20the%20three%20months%20ended%20March%2031%2C%202024%20and%202023) This section outlines the company's revenues, expenses, net income, and comprehensive income for Q1 2024 and 2023 Consolidated Statements of Comprehensive Income (Loss) (Millions USD) | Metric | Three Months Ended March 31, 2024 (Millions USD) | Three Months Ended March 31, 2023 (Millions USD) | | :------------------------------------------------ | :----------------------------------- | :----------------------------------- | | Total revenues | 4,116 | 3,814 | | Total expenses | 2,588 | 4,984 | | Income (loss) before taxes | 1,528 | (1,170) | | Federal income tax expense (benefit) | 306 | (289) | | Net income (loss) | 1,222 | (881) | | Total other comprehensive income (loss), net of tax | (475) | 2,598 | | Comprehensive income (loss) | 747 | 1,717 | | Net income (loss) available to common stockholders | 1,191 | (909) | | Basic Net Income (Loss) Per Common Share | 6.98 | (5.35) | | Diluted Net Income (Loss) Per Common Share | 6.93 | (5.37) | - Net income significantly improved to **$1,222 million** for Q1 2024, compared to a net loss of **$(881) million** in Q1 2023, primarily due to a market risk benefit gain and higher total revenues[12](index=12&type=chunk) - Total revenues increased by **$302 million (7.9%)** year-over-year, while total expenses decreased by **$2,396 million (48.1%)** due to a market risk benefit gain[12](index=12&type=chunk) [Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Stockholders'%20Equity%20for%20the%20three%20months%20ended%20March%2031%2C%202024%20and%202023) This section presents changes in stockholders' equity, including preferred stock, common stock, and retained earnings, for Q1 2024 and 2023 Consolidated Statements of Stockholders' Equity (Millions USD) | Metric | March 31, 2024 (Millions USD) | March 31, 2023 (Millions USD) | | :------------------------------------ | :----------------------------- | :----------------------------- | | Preferred Stock (end-of-period) | 986 | 986 | | Common Stock (end-of-period) | 4,624 | 4,560 | | Retained Earnings (end-of-period) | 5,887 | 4,940 | | Accumulated Other Comprehensive Income (Loss) (end-of-period) | (3,951) | (3,754) | | Total stockholders' equity (end-of-period) | 7,546 | 6,732 | - Total stockholders' equity increased by **$814 million (12.1%)** from March 31, 2023, to March 31, 2024, driven by net income and an increase in retained earnings[14](index=14&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20three%20months%20ended%20March%2031%2C%202024%20and%202023) This section reports the company's cash flows from operating, investing, and financing activities for Q1 2024 and 2023 Consolidated Statements of Cash Flows (Millions USD) | Metric | Three Months Ended March 31, 2024 (Millions USD) | Three Months Ended March 31, 2023 (Millions USD) | | :------------------------------------------------ | :----------------------------------- | :----------------------------------- | | Net cash provided by (used in) operating activities | (1,343) | (774) | | Net cash provided by (used in) investing activities | 1,639 | (325) | | Net cash provided by (used in) financing activities | 461 | 1,522 | | Net increase (decrease) in cash, invested cash and restricted cash | 757 | 423 | | Cash, invested cash and restricted cash as of end-of-period | 4,122 | 3,766 | - Net cash used in operating activities increased to **$(1,343) million** in Q1 2024 from **$(774) million** in Q1 2023[16](index=16&type=chunk) - Net cash provided by investing activities significantly improved to **$1,639 million** in Q1 2024, compared to net cash used of **$(325) million** in Q1 2023[16](index=16&type=chunk) [Notes to Unaudited Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the unaudited consolidated financial statements [Note 1 – Nature of Operations and Basis of Presentation](index=11&type=section&id=Note%201%20%E2%80%93%20Nature%20of%20Operations%20and%20Basis%20of%20Presentation) This note describes the company's business segments and the basis for preparing its financial statements - Lincoln National Corporation operates four business segments: Annuities, Life Insurance, Group Protection, and Retirement Plan Services, offering a wide range of wealth accumulation, wealth protection, group protection, and retirement income products[18](index=18&type=chunk) - The company announced on December 14, 2023, an agreement to sell its wealth management business, with the transaction expected to close in the first half of 2024[23](index=23&type=chunk) Assets and Liabilities Classified as Held-for-Sale (Millions USD) | Metric | March 31, 2024 (Millions USD) | December 31, 2023 (Millions USD) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Assets classified as held-for-sale | 155 | 131 | | Liabilities classified as held-for-sale | 81 | 60 | [Note 2 – New Accounting Standards](index=13&type=section&id=Note%202%20%E2%80%93%20New%20Accounting%20Standards) This note discusses the impact and evaluation of recently issued accounting standards on the company's financial reporting - The company did not adopt any new material Accounting Standards Updates (ASUs) in the current period[25](index=25&type=chunk) - ASU 2023-07 (Segment Reporting) and ASU 2023-09 (Income Taxes) are effective for annual filings on January 1, 2024, and January 1, 2025, respectively, and the company is evaluating their impact[27](index=27&type=chunk) [Note 3 – Investments](index=14&type=section&id=Note%203%20%E2%80%93%20Investments) This note provides detailed information on the company's investment portfolio, including fixed maturity securities and mortgage loans Investment Categories (Millions USD) | Investment Category | March 31, 2024 (Millions USD) | December 31, 2023 (Millions USD) | | :------------------------------------ | :----------------------------- | :----------------------------- | | Total fixed maturity AFS securities | 87,764 | 88,738 | | Total investments | 125,702 | 124,331 | - Gross unrealized losses on fixed maturity AFS securities increased by **$814 million** to **$10,581 million** as of March 31, 2024, primarily due to rising interest rates and widening credit spreads[28](index=28&type=chunk)[31](index=31&type=chunk) - The company does not believe the unrealized losses require impairment recognition in earnings, as it does not intend to sell these securities and expects to recover their amortized cost[31](index=31&type=chunk) Mortgage Loans on Real Estate (Millions USD) | Mortgage Loans on Real Estate (Millions USD) | March 31, 2024 | December 31, 2023 | | :------------------------------------------- | :------------- | :---------------- | | Total carrying value | 19,266 | 18,963 | | Allowance for credit losses | (115) | (114) | | Commercial mortgage loans on nonaccrual status | 60 | 0 | | Residential mortgage loans on nonaccrual status | 61 | 62 | [Note 4 – Variable Interest Entities](index=26&type=section&id=Note%204%20%E2%80%93%20Variable%20Interest%20Entities) This note explains the company's involvement with variable interest entities and its maximum exposure to loss - The company makes passive investments in structured securities (ABS, RMBS, CMBS) issued by unconsolidated Variable Interest Entities (VIEs), with maximum exposure to loss limited to the amortized cost of these investments[66](index=66&type=chunk) Carrying Amounts of Investments in LPs and LLCs (Millions USD) | Investment Type | March 31, 2024 (Millions USD) | December 31, 2023 (Millions USD) | | :------------------------------------ | :----------------------------- | :----------------------------- | | Carrying amounts of investments in LPs and LLCs | 4,500 | 4,200 | [Note 5 – Derivatives](index=28&type=section&id=Note%205%20%E2%80%93%20Derivatives) This note details the company's use of derivative instruments for risk management and their fair value - The company uses derivative instruments to manage interest rate, foreign currency exchange, equity market, basis, commodity, and credit risks, employing various strategies including swaps, futures, and options[68](index=68&type=chunk)[71](index=71&type=chunk)[78](index=78&type=chunk)[81](index=81&type=chunk)[87](index=87&type=chunk)[88](index=88&type=chunk) Derivative Notional Amounts (Millions USD) | Derivative Type | Notional Amounts (March 31, 2024, Millions USD) | Notional Amounts (December 31, 2023, Millions USD) | | :------------------------------------ | :--------------------------------------------- | :--------------------------------------------- | | Total cash flow hedges | 6,305 | 6,360 | | Total fair value hedges | 1,101 | 1,106 | | Total non-qualifying hedges | 304,324 | 316,848 | | Total derivative instruments | 311,720 | 324,318 | - The company's net collateral payable position for derivative contracts increased to **$6.8 billion** as of March 31, 2024, from **$5.0 billion** as of December 31, 2023, reflecting changes in underlying derivative market values[104](index=104&type=chunk)[423](index=423&type=chunk) [Note 6 – DAC, VOBA, DSI and DFEL](index=39&type=section&id=Note%206%20%E2%80%93%20DAC%2C%20VOBA%2C%20DSI%20and%20DFEL) This note provides information on deferred acquisition costs, value of business acquired, deferred sales inducements, and deferred fee and expense liabilities DAC, VOBA, DSI and DFEL Balances (Millions USD) | Metric (Millions USD) | March 31, 2024 | December 31, 2023 | | :------------------------------------ | :------------- | :---------------- | | Total DAC, VOBA and DSI | 12,405 | 12,397 | | Total DFEL | 6,099 | 5,901 | Amortization Expense (Millions USD) | Amortization Expense (Millions USD) | Q1 2024 | Q1 2023 | | :------------------------------------ | :------ | :------ | | DAC amortization expense | 249 | 245 | | VOBA amortization expense | 13 | 14 | | DSI amortization expense | 3 | 5 | | DFEL amortization | 74 | 68 | [Note 7 – Reinsurance](index=44&type=section&id=Note%207%20%E2%80%93%20Reinsurance) This note describes the company's reinsurance agreements and related recoverables and deferred losses - Effective October 1, 2023, the company entered into two reinsurance agreements with Fortitude Re for ULSG, MoneyGuard®, and fixed annuity products, which represents its largest reinsurance exposure[118](index=118&type=chunk) Reinsurance Recoverables (Millions USD) | Reinsurance Recoverables (Millions USD) | March 31, 2024 | December 31, 2023 | | :--------------------------------------- | :------------- | :---------------- | | ULSG and life-contingent annuities | 10,500 | 10,500 | | Deposit assets for non-life-contingent annuities | 3,900 | 4,200 | | Deposit assets for MoneyGuard block | 7,800 | 7,800 | - A deferred loss of **$2.7 billion** was reported on the ULSG and fixed annuities coinsurance treaty, with **$22 million** amortized in Q1 2024[119](index=119&type=chunk) [Note 8 – MRBs](index=44&type=section&id=Note%208%20%E2%80%93%20MRBs) This note details market risk benefits, including assets, liabilities, and net amount at risk MRB Category (Millions USD) | MRB Category (Millions USD) | March 31, 2024 | December 31, 2023 | | :------------------------------------ | :------------- | :---------------- | | Total MRB assets | 4,878 | 3,894 | | Total MRB liabilities | 1,266 | 1,716 | | Net MRB (Assets) Liabilities | (3,612) | (2,178) | Net Amount at Risk (NAR) (Millions USD) | Net Amount at Risk (NAR) (Millions USD) | March 31, 2024 | March 31, 2023 | | :--------------------------------------- | :------------- | :------------- | | Variable Annuities NAR | 2,056 | 6,268 | | Fixed Annuities NAR | 210 | 192 | | Retirement Plan Services NAR | 3 | 9 | | UL and Other NAR | 300,740 | 303,412 | - The net MRB asset position improved to **$(3,612) million (asset)** as of March 31, 2024, from **$(2,178) million (asset)** as of December 31, 2023, primarily due to the effect of changes in interest rates and equity markets[122](index=122&type=chunk) [Note 9 – Separate Accounts](index=46&type=section&id=Note%209%20%E2%80%93%20Separate%20Accounts) This note presents information on separate account assets and liabilities and their changes Separate Account Balances (Millions USD) | Separate Account (Millions USD) | March 31, 2024 | December 31, 2023 | | :------------------------------------ | :------------- | :---------------- | | Total separate account assets | 166,225 | 158,257 | | Total separate account liabilities | 166,225 | 158,257 | - Separate account assets and liabilities increased by **$7.968 billion (5.0%)** from December 31, 2023, to March 31, 2024, primarily driven by changes in market performance[123](index=123&type=chunk) [Note 10 – Policyholder Account Balances](index=47&type=section&id=Note%2010%20%E2%80%93%20Policyholder%20Account%20Balances) This note provides details on policyholder account balances and weighted-average crediting rates Policyholder Account Balances and Crediting Rates (Millions USD) | Policyholder Account (Millions USD) | March 31, 2024 | December 31, 2023 | | :------------------------------------ | :------------- | :---------------- | | Total policyholder account balances | 122,300 | 120,737 | | Weighted-average crediting rate (Variable Annuities) | 2.1% | 1.9% | | Weighted-average crediting rate (Fixed Annuities) | 2.9% | 2.6% | | Weighted-average crediting rate (UL and Other) | 3.9% | 4.0% | | Weighted-average crediting rate (Retirement Plan Services) | 2.8% | 2.7% | - Total policyholder account balances increased by **$1.563 billion (1.3%)** from December 31, 2023, to March 31, 2024, primarily due to gross deposits and changes in the fair value of embedded derivative instruments[124](index=124&type=chunk) [Note 11 – Future Contract Benefits](index=51&type=section&id=Note%2011%20%E2%80%93%20Future%20Contract%20Benefits) This note outlines future contract benefits and their weighted-average durations across various product lines Future Contract Benefits and Durations (Millions USD) | Future Contract Benefits (Millions USD) | March 31, 2024 | December 31, 2023 | | :-------------------------------------- | :------------- | :---------------- | | Total future contract benefits | 38,848 | 39,864 | | Weighted-average duration (Payout Annuities) | 9 years | 9 years | | Weighted-average duration (Traditional Life) | 9 years | 10 years | | Weighted-average duration (Group Protection) | 5 years | 4 years | | Weighted-average duration (UL and Other) | 17 years | 17 years | - Total future contract benefits decreased by **$1.016 billion (2.5%)** from December 31, 2023, to March 31, 2024[129](index=129&type=chunk) - For Q1 2024, Group Protection experienced more favorable claim terminations than assumed, while UL and Other had unfavorable actual mortality experience[133](index=133&type=chunk)[136](index=136&type=chunk) [Note 12 – Debt](index=57&type=section&id=Note%2012%20%E2%80%93%20Debt) This note details the company's short-term and long-term debt, including recent issuances and repayments Debt Balances (Millions USD) | Debt (Millions USD) | March 31, 2024 | December 31, 2023 | | :------------------------------------ | :------------- | :---------------- | | Short-term debt | 503 | 250 | | Long-term debt | 5,726 | 5,699 | | Total debt | 6,229 | 5,949 | - Total debt increased by **$280 million (4.7%)** from December 31, 2023, to March 31, 2024, primarily due to the issuance of **$350 million** in 5.852% Senior Notes due 2034, partially offset by repayment of a variable rate term loan[138](index=138&type=chunk)[410](index=410&type=chunk) [Note 13 – Fair Value of Financial Instruments](index=58&type=section&id=Note%2013%20%E2%80%93%20Fair%20Value%20of%20Financial%20Instruments) This note provides fair value measurements for financial instruments, categorized by valuation hierarchy levels Financial Instrument Fair Values (Millions USD) | Financial Instrument (Millions USD) | March 31, 2024 (Carrying Value) | March 31, 2024 (Fair Value) | | :---------------------------------- | :------------------------------ | :-------------------------- | | Fixed maturity AFS securities | 87,764 | 87,764 | | Mortgage loans on real estate | 19,266 | 17,658 | | Derivative investments | 8,394 | 8,394 | | Long-term debt | (5,726) | (5,058) | Fair Value Hierarchy (Millions USD) | Fair Value Hierarchy (Millions USD) | Level 1 | Level 2 | Level 3 | Total Fair Value | | :---------------------------------- | :------ | :------ | :------ | :--------------- | | Total assets at fair value (March 31, 2024) | 837 | 270,059 | 11,431 | 282,327 | | Total liabilities at fair value (March 31, 2024) | 0 | (6,149) | (13,831) | (19,980) | - For financial instruments not carried at fair value, mortgage loans on real estate, other investments, separate account assets, policyholder account balances, and other liabilities are valued using discounted cash flow methods or surrender values, with inputs classified as Level 2 or Level 3[142](index=142&type=chunk)[143](index=143&type=chunk)[144](index=144&type=chunk)[145](index=145&type=chunk)[146](index=146&type=chunk) [Note 14 – Contingencies and Commitments](index=76&type=section&id=Note%2014%20%E2%80%93%20Contingencies%20and%20Commitments) This note discloses the company's involvement in legal and regulatory proceedings and potential financial exposures - The company is involved in various legal and regulatory proceedings, including class actions related to cost of insurance rates, with an estimated aggregate range of reasonably possible losses up to approximately **$150 million**, after-tax, as of March 31, 2024[175](index=175&type=chunk)[178](index=178&type=chunk) - A provisional settlement of **$147.5 million** pre-tax cash payment was reached in the Glover v. Connecticut General Life Insurance Company and related cost of insurance litigation, with an accrual of approximately **$110 million** recorded in Q1 2024[183](index=183&type=chunk) - The company is vigorously defending new putative class actions, including Donald C. Meade, et al v. Lincoln National Corporation, alleging misstatements regarding VUL business, goodwill, policy lapse assumptions, and reserves[199](index=199&type=chunk)[436](index=436&type=chunk) [Note 15 – Shares and Stockholders' Equity](index=83&type=section&id=Note%2015%20%E2%80%93%20Shares%20and%20Stockholders'%20Equity) This note provides details on outstanding shares, dividends declared, and earnings per share Share Information | Share Type | March 31, 2024 (Shares) | December 31, 2023 (Shares) | | :------------------------------------ | :---------------------- | :---------------------- | | Total preferred shares outstanding | 40,000 | 40,000 | | Common stock outstanding | 170,016,887 | 169,666,137 | Dividends Declared (Millions USD) | Dividends Declared (Millions USD) | Q1 2024 | Q1 2023 | | :-------------------------------- | :------ | :------ | | Total preferred stock dividends | 34 | 25 | | Cash Dividends Declared Per Common Share | 0.45 | 0.45 | EPS (USD) | EPS (USD) | Q1 2024 | Q1 2023 | | :------------------------------------ | :------ | :------ | | Basic Net Income (Loss) Per Common Share | 6.98 | (5.35) | | Diluted Net Income (Loss) Per Common Share | 6.93 | (5.37) | [Note 16 – Segment Information](index=88&type=section&id=Note%2016%20%E2%80%93%20Segment%20Information) This note presents financial performance data for the company's operating segments and key performance measures - The company reports results through four segments: Annuities, Life Insurance, Group Protection, and Retirement Plan Services, plus Other Operations, with segment operating revenues and income (loss) from operations used as key performance measures[208](index=208&type=chunk)[209](index=209&type=chunk)[234](index=234&type=chunk) Segment Operating Revenues (Millions USD) | Segment Operating Revenues (Millions USD) | Q1 2024 | Q1 2023 | | :---------------------------------------- | :------ | :------ | | Annuities | 1,269 | 1,141 | | Life Insurance | 1,541 | 1,757 | | Group Protection | 1,425 | 1,388 | | Retirement Plan Services | 322 | 328 | | Other Operations | 27 | 43 | | Total operating revenues | 4,584 | 4,657 | Segment Income (Loss) from Operations (Millions USD) | Segment Income (Loss) from Operations (Millions USD) | Q1 2024 | Q1 2023 | | :--------------------------------------------------- | :------ | :------ | | Annuities | 259 | 274 | | Life Insurance | (35) | (13) | | Group Protection | 80 | 71 | | Retirement Plan Services | 36 | 43 | | Other Operations | (235) | (87) | | Total Income (Loss) from Operations | 105 | 288 | [Note 17 – Realized Gain (Loss)](index=93&type=section&id=Note%2017%20%E2%80%93%20Realized%20Gain%20(Loss)) This note details realized gains and losses from various investment and derivative activities Realized Gain (Loss) (Millions USD) | Realized Gain (Loss) (Millions USD) | Q1 2024 | Q1 2023 | | :---------------------------------- | :------ | :------ | | Fixed maturity AFS securities (net) | (56) | (56) | | Realized gain (loss) on equity securities | 11 | (14) | | Indexed product derivative results | 145 | (153) | | Derivative results | (548) | (477) | | Total realized gain (loss) | (434) | (828) | - Total realized gain (loss) improved significantly to **$(434) million** in Q1 2024 from **$(828) million** in Q1 2023, driven by improved indexed product derivative results and derivative results[217](index=217&type=chunk) [Note 18 – Federal Income Taxes](index=93&type=section&id=Note%2018%20%E2%80%93%20Federal%20Income%20Taxes) This note explains the company's effective tax rate and deferred tax assets Effective Tax Rate | Effective Tax Rate | Q1 2024 | Q1 2023 | | :----------------- | :------ | :------ | | Effective tax rate | 20% | 25% | - The effective tax rate for Q1 2024 was **20%**, lower than the prevailing corporate federal income tax rate of **21%**, primarily due to preferential tax items[218](index=218&type=chunk)[219](index=219&type=chunk) - The company holds an approximate **$5 billion** deferred tax asset related to net unrealized losses on fixed maturity AFS securities, which management believes is realizable due to the intent and ability to hold these securities to recovery[274](index=274&type=chunk)[275](index=275&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=95&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on Lincoln National Corporation's financial condition as of March 31, 2024, and results of operations for the three months ended March 31, 2024, compared to the prior year. It covers critical accounting estimates, consolidated and segment-level performance, investment portfolio analysis, and liquidity and capital resources [Forward-Looking Statements – Cautionary Language](index=96&type=section&id=Forward-Looking%20Statements%20%E2%80%93%20Cautionary%20Language) This section warns readers about inherent risks and uncertainties that could impact future financial results - The report contains forward-looking statements subject to risks and uncertainties, including economic conditions, market volatility, regulatory changes, and litigation outcomes, which could cause actual results to differ materially[226](index=226&type=chunk)[227](index=227&type=chunk) - Key risk factors include adverse capital and credit market conditions, inability of subsidiaries to pay dividends, legislative/regulatory changes, interest rate fluctuations, and ineffectiveness of risk management policies[227](index=227&type=chunk) [Introduction](index=98&type=section&id=Introduction) This section introduces Lincoln National Corporation's business segments and key performance metrics used by management - Lincoln National Corporation operates through Annuities, Life Insurance, Group Protection, and Retirement Plan Services segments, plus Other Operations[233](index=233&type=chunk)[236](index=236&type=chunk) - Management uses segment operating revenues and income (loss) from operations as key performance measures to evaluate ongoing business trends, excluding unpredictable items[234](index=234&type=chunk)[238](index=238&type=chunk) - The company announced an agreement to sell its wealth management business, Lincoln Financial Network (LFN), with closing expected in the first half of 2024[240](index=240&type=chunk) [Summary of Critical Accounting Estimates](index=100&type=section&id=Summary%20of%20Critical%20Accounting%20Estimates) This section outlines the significant accounting estimates and judgments, including investment valuation and market risk benefits Investment Valuation (Millions USD) | Investment Valuation (Millions USD) | Level 1 | Level 2 | Level 3 | Total Fair Value | | :---------------------------------- | :------ | :------ | :------ | :--------------- | | Priced by third-party pricing services | 431 | 76,765 | 140 | 77,336 | | Priced by independent broker quotations | 0 | 0 | 4,479 | 4,479 | | Priced by matrices | 0 | 16,976 | 0 | 16,976 | | Priced by other methods | 0 | 0 | 233 | 233 | | Total | 431 | 93,741 | 4,852 | 99,024 | | Percent of total | 0% | 95% | 5% | 100% | - MRBs are valued based on stochastic projections incorporating non-performance risk, with key assumptions for capital markets, lapse, benefit utilization, mortality, and administrative expenses[258](index=258&type=chunk) Hypothetical Effect to Net Income (Millions USD) | Hypothetical Effect to Net Income (Millions USD) | -10% Equity Market Return | +10% Equity Market Return | -25 bps Interest Rates | +25 bps Interest Rates | | :----------------------------------------------- | :------------------------ | :------------------------ | :--------------------- | :--------------------- | | MRBs | (775) | 675 | (425) | 400 | [Results of Consolidated Operations](index=110&type=section&id=Results%20of%20Consolidated%20Operations) This section analyzes the company's overall financial performance, highlighting key drivers of net income and expenses Consolidated Operations Metrics (Millions USD) | Metric (Millions USD) | Q1 2024 | Q1 2023 | | :--------------------------------------------------- | :------ | :------ | | Net Income (Loss) | 1,222 | (881) | | Income (loss) from operations (total) | 105 | 288 | | Net annuity product features, after-tax | 1,141 | (1,018) | | Net life insurance product features, after-tax | (103) | (95) | | Changes in fair value of reinsurance-related embedded derivatives, trading securities and certain mortgage loans, after-tax | 153 | 7 | - Consolidated net income significantly increased to **$1,222 million** in Q1 2024 from a loss of **$(881) million** in Q1 2023, primarily driven by a gain in net annuity product features and favorable changes in the fair value of reinsurance-related embedded derivatives[278](index=278&type=chunk) - The increase in net income was partially offset by a legal accrual and higher compensation-related expenses in Q1 2024[278](index=278&type=chunk) [Results of Annuities](index=111&type=section&id=Results%20of%20Annuities) This section details the financial performance of the Annuities segment, including revenues, expenses, and account balances Annuities Segment Metrics (Millions USD) | Metric (Millions USD) | Q1 2024 | Q1 2023 | | :------------------------------------ | :------ | :------ | | Total operating revenues | 1,269 | 1,141 | | Income (loss) from operations | 259 | 274 | | Fee income | 580 | 540 | | Net investment income | 420 | 421 | | Interest credited | 354 | 278 | | Commissions and other expenses | 571 | 501 | - Annuities' income from operations decreased to **$259 million** in Q1 2024 from **$274 million** in Q1 2023, mainly due to lower net investment income (net of interest credited), higher commissions, and increased federal income tax expense[281](index=281&type=chunk) - The decrease was partially offset by higher fee income, driven by increased average daily variable account balances[281](index=281&type=chunk) Annuity Account Balances (Millions USD) | Account Balances (Millions USD) | Q1 2024 | Q1 2023 | | :------------------------------------ | :------ | :------ | | Variable annuity account balances | 118,176 | 108,334 | | Average daily variable annuity account balances | 114,943 | 108,128 | | Fixed annuity account balances | 41,617 | 38,818 | | Average fixed annuity account balances | 40,348 | 38,203 | [Results of Life Insurance](index=117&type=section&id=Results%20of%20Life%20Insurance) This section analyzes the financial performance of the Life Insurance segment, including revenues, expenses, and sales by product Life Insurance Segment Metrics (Millions USD) | Metric (Millions USD) | Q1 2024 | Q1 2023 | | :------------------------------------ | :------ | :------ | | Total operating revenues | 1,541 | 1,757 | | Income (loss) from operations | (35) | (13) | | Fee income | 672 | 776 | | Net investment income | 581 | 687 | | Interest credited | 294 | 328 | | Benefits and policyholder remeasurement (gain) loss | 987 | 1,139 | - Life Insurance segment's loss from operations increased to **$(35) million** in Q1 2024 from **$(13) million** in Q1 2023, primarily due to lower fee income, reduced net investment income (net of interest credited), and amortization of deferred loss from the Q4 2023 reinsurance transaction[297](index=297&type=chunk)[300](index=300&type=chunk) - The increase in loss was partially offset by lower benefits and policyholder liability remeasurement (gain) loss, also influenced by the Q4 2023 reinsurance transaction[297](index=297&type=chunk) Life Insurance Sales by Product (Millions USD) | Sales by Product (Millions USD) | Q1 2024 | Q1 2023 | | :------------------------------ | :------ | :------ | | IUL/UL | 18 | 34 | | MoneyGuard® | 24 | 21 | | VUL | 23 | 30 | | Term | 19 | 30 | | Executive Benefits | 7 | 15 | | Total sales | 91 | 130 | [Results of Group Protection](index=125&type=section&id=Results%20of%20Group%20Protection) This section reviews the financial performance of the Group Protection segment, focusing on premiums, benefits, and sales Group Protection Segment Metrics (Millions USD) | Metric (Millions USD) | Q1 2024 | Q1 2023 | | :------------------------------------ | :------ | :------ | | Total operating revenues | 1,425 | 1,388 | | Income (loss) from operations | 80 | 71 | | Insurance premiums | 1,285 | 1,251 | | Net investment income | 85 | 85 | | Benefits, interest credited and policyholder liability remeasurement (gain) loss | 964 | 938 | | Commissions and other expenses | 360 | 361 | | Loss Ratios (Total) | 75.0% | 75.0% | - Group Protection's income from operations increased to **$80 million** in Q1 2024 from **$71 million** in Q1 2023, driven by higher insurance premiums due to business growth[318](index=318&type=chunk) - The increase was partially offset by higher total benefits and policyholder liability remeasurement (gain) loss, primarily due to increased claim experience in the disability business[318](index=318&type=chunk) Group Protection Sales by Product Line (Millions USD) | Sales by Product Line (Millions USD) | Q1 2024 | Q1 2023 | | :----------------------------------- | :------ | :------ | | Life | 85 | 82 | | Disability | 51 | 40 | | Dental | 8 | 6 | | Total sales | 144 | 128 | [Results of Retirement Plan Services](index=131&type=section&id=Results%20of%20Retirement%20Plan%20Services) This section examines the financial performance of the Retirement Plan Services segment, including revenues, income, and net flows Retirement Plan Services Segment Metrics (Millions USD) | Metric (Millions USD) | Q1 2024 | Q1 2023 | | :------------------------------------ | :------ | :------ | | Total operating revenues | 322 | 328 | | Income (loss) from operations | 36 | 43 | | Fee income | 70 | 64 | | Net investment income | 244 | 255 | | Interest credited | 166 | 167 | | Commissions and other expenses | 115 | 110 | - Retirement Plan Services' income from operations decreased to **$36 million** in Q1 2024 from **$43 million** in Q1 2023, mainly due to lower net investment income from reduced average fixed account balances and higher commissions and other expenses[332](index=332&type=chunk) - The decrease was partially offset by higher fee income, driven by increased variable account balances and business growth[330](index=330&type=chunk) Retirement Plan Services Net Flows By Market (Millions USD) | Net Flows By Market (Millions USD) | Q1 2024 | Q1 2023 | | :--------------------------------- | :------ | :------ | | Small market | (32) | 148 | | Mid – large market | 847 | 711 | | Multi-Fund® and other | (424) | (324) | | Total net flows | 391 | 535 | [Results of Other Operations](index=137&type=section&id=Results%20of%20Other%20Operations) This section discusses the financial results of Other Operations, including revenues, expenses, and net investment income Other Operations Segment Metrics (Millions USD) | Metric (Millions USD) | Q1 2024 | Q1 2023 | | :------------------------------------ | :------ | :------ | | Total operating revenues | 27 | 43 | | Income (loss) from operations | (235) | (87) | | Net investment income | 16 | 35 | | Interest credited | 9 | 10 | | Other expenses | 226 | 37 | | Interest and debt expense | 81 | 83 | - Loss from operations for Other Operations increased to **$(235) million** in Q1 2024 from **$(87) million** in Q1 2023, primarily due to higher other expenses, including a legal accrual and severance expense[344](index=344&type=chunk) - Net investment income decreased due to lower excess capital retained by Other Operations, while interest credited remained stable, largely related to reinsurance operations[345](index=345&type=chunk)[347](index=347&type=chunk) [Consolidated Investments](index=140&type=section&id=Consolidated%20Investments) This section provides an overview of the company's investment portfolio, objectives, and performance Investment Type (Millions USD) | Investment Type (Millions USD) | March 31, 2024 | December 31, 2023 | | :------------------------------------ | :------------- | :---------------- | | Fixed maturity AFS securities | 87,764 | 88,738 | | Mortgage loans on real estate | 19,266 | 18,963 | | Derivative investments | 8,394 | 6,474 | | Alternative investments | 3,480 | 3,377 | | Total investments | 125,702 | 124,331 | - The investment objective is a balanced approach for current income and risk management, emphasizing sufficient income to meet obligations and general liabilities[354](index=354&type=chunk) Fixed Maturity AFS Securities (Millions USD) | Fixed Maturity AFS Securities (Millions USD) | March 31, 2024 (Fair Value) | December 31, 2023 (Fair Value) | | :------------------------------------------- | :-------------------------- | :----------------------------- | | Total investment grade securities | 85,007 | 85,848 | | Total below investment grade securities | 2,757 | 2,890 | | Total fixed maturity AFS securities | 87,764 | 88,738 | | Total securities below investment grade as a percentage of total fixed maturity AFS securities | 3.2% | 3.3% | - The company's gross unrealized losses on fixed maturity AFS securities increased by **$814 million** in Q1 2024, but management does not believe impairment recognition is required due to intent and ability to hold to recovery[362](index=362&type=chunk)[365](index=365&type=chunk) Net Investment Income (Millions USD) | Net Investment Income (Millions USD) | Q1 2024 | Q1 2023 | | :----------------------------------- | :------ | :------ | | Investment income | 1,440 | 1,541 | | Investment expense | (94) | (75) | | Net investment income | 1,346 | 1,466 | | Net investment income yield on invested assets | 4.26% | 4.19% | [Liquidity and Capital Resources](index=160&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's ability to meet financial obligations and fund operations, including capital adequacy - The company's liquidity depends on business profitability, economic conditions, and access to capital markets, with the holding company relying on subsidiary dividends and inter-company borrowing[394](index=394&type=chunk)[395](index=395&type=chunk) - Capital refers to long-term financial resources supporting operations, growth strategies, and adverse conditions, with RBC ratio being a primary measure for insurance subsidiaries[396](index=396&type=chunk)[402](index=402&type=chunk) Holding Company Liquidity (Millions USD) | Holding Company Liquidity (Millions USD) | Q1 2024 | Q1 2023 | | :--------------------------------------- | :------ | :------ | | Dividends from Subsidiaries | 180 | 205 | | Interest from Subsidiaries | 40 | 36 | | Total preferred stock dividends paid | 34 | 25 | | Dividends to common stockholders | 76 | 76 | - LNL has an estimated maximum borrowing capacity of **$7.0 billion** under the FHLBI facility, with **$2.9 billion** outstanding as of March 31, 2024[421](index=421&type=chunk) - A downgrade in financial strength or credit ratings could trigger derivative agreement terms, negatively affecting liquidity, marketing ability, and relationships with creditors[426](index=426&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=169&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section highlights the company's integrated approach to managing market risks, including interest rate, equity market, credit, and foreign currency exchange risks, through an asset-liability management process that considers diversification - The company manages market risks (interest rate, equity market, credit, foreign currency exchange) through an integrated asset-liability management process[427](index=427&type=chunk) [Item 4. Controls and Procedures](index=169&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of the company's disclosure controls and procedures as of March 31, 2024, and reports no material changes in internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that disclosure controls and procedures were effective as of March 31, 2024[429](index=429&type=chunk) - There were no material changes in the company's internal control over financial reporting during the quarter ended March 31, 2024[430](index=430&type=chunk) [PART II – OTHER INFORMATION](index=169&type=section&id=PART%20II%20OTHER%20INFORMATION) This section provides additional information not covered in the financial statements, including legal proceedings, risk factors, and other disclosures [Item 1. Legal Proceedings](index=169&type=section&id=Item%201.%20Legal%20Proceedings) This section updates on significant legal proceedings, including a provisional settlement in the Glover v. Connecticut General Life Insurance Company and related cost of insurance litigation for $147.5 million pre-tax. It also notes the completion of settlement distribution payments for other COI litigations and the filing of a new putative class action alleging misstatements - A provisional settlement of **$147.5 million** pre-tax cash payment was reached in the Glover v. Connecticut General Life Insurance Company and related cost of insurance litigation, encompassing policies in several other lawsuits[433](index=433&type=chunk) - Settlement distribution payments for In re: Lincoln National COI Litigation and In re: Lincoln National 2017 COI Rate Litigation were completed on April 8, 2024[434](index=434&type=chunk) - A new putative class action, Donald C. Meade, et al v. Lincoln National Corporation, was filed on April 23, 2024, alleging materially false/misleading statements regarding VUL business, goodwill, policy lapse assumptions, and reserves[435](index=435&type=chunk)[436](index=436&type=chunk) [Item 1A. Risk Factors](index=171&type=section&id=Item%201A.%20Risk%20Factors) This section refers readers to the comprehensive risk factors detailed in the company's 2023 Form 10-K, emphasizing that additional unknown or immaterial risks could also impact business operations and the value of securities - Readers should consider risks outlined in the 2023 Form 10-K, as additional unknown or currently immaterial risks could materially affect business operations and security values[438](index=438&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=171&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reports no purchases of equity securities by the company during the quarter ended March 31, 2024, and notes a remaining share repurchase authorization of $714 million Equity Securities Purchases | Period | Total Number of Shares Purchased | Average Price Paid per Share (USD) | | :---------------- | :----------------------------- | :------------------------------- | | 1/1/24 – 1/31/24 | - | - | | 2/1/24 – 2/29/24 | - | - | | 3/1/24 – 3/31/24 | - | - | - As of March 31, 2024, the company had a remaining security repurchase authorization of **$714 million**, with no expiration date[439](index=439&type=chunk) [Item 5. Other Information](index=171&type=section&id=Item%205.%20Other%20Information) This section states that none of the company's directors or officers adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the first quarter of 2024 - No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the three months ended March 31, 2024[440](index=440&type=chunk) [Item 6. Exhibits](index=171&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including forms for senior notes, long-term incentive award programs, certifications, and XBRL documents - The exhibit index includes forms for 5.852% Senior Notes due 2034, Long-Term Incentive Award Program Performance Cycle (PSA) Agreements, Restricted Stock Unit (RSU) Award Agreements for CEO and Senior Management Committee, and various certifications (Sections 302 and 906 of Sarbanes-Oxley Act)[443](index=443&type=chunk) - XBRL Instance, Schema, Calculation, Label, and Presentation Linkbase Documents are also included[443](index=443&type=chunk) [SIGNATURES](index=175&type=section&id=SIGNATURES) This section contains the duly authorized signatures of Lincoln National Corporation's Executive Vice President and Chief Financial Officer, Christopher Neczypor, and Senior Vice President, Chief Accounting Officer and Treasurer, Adam Cohen, dated May 2, 2024, affirming the filing of the report - The report is signed by Christopher Neczypor, Executive Vice President and Chief Financial Officer, and Adam Cohen, Senior Vice President, Chief Accounting Officer and Treasurer, on behalf of Lincoln National Corporation[447](index=447&type=chunk) - The filing date of the report is May 2, 2024[447](index=447&type=chunk)

For the quarter ended March 2024, Lincoln National (LNC) reported revenue of $4.58 billion, down 1.6% over the same period last year. EPS came in at $1.37, compared to $1.52 in the year-ago quarter.The reported revenue represents a surprise of -1.30% over the Zacks Consensus Estimate of $4.64 billion. With the consensus EPS estimate being $1.10, the EPS surprise was +24.55%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street ...

Lincoln Financial Group Table of Contents | N | o | t | e | s | 1 | C | r | e | d | i | t | R | a | t | i | n | g | s | 2 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | -- ...

Redesigning and repricing of products and services to maintain sales and profitability have been driving Zacks Life Insurance industry players. Life insurers are the direct beneficiaries of an improving rate environment as they invest a large portion of their premiums. Increased automation is expected to drive premium growth and boost the efficiency of Manulife Financial Corporation (MFC) , Sun Life Financial Inc. (SLF) , Reinsurance Group of America, Incorporated (RGA) , Primerica (PRI) and Lincoln Nationa ...

For the fiscal year ended December 31, 2023 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark One) ☒ Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | Title of each class | Trading symbol | Name of each exchange on which | | --- | --- | --- | | | | registered | | Common Stock | LNC | New York Stock Exchange | | th Depositary Shares, each representing a 1/1000 interest in a share | LNC PRD | New York Stock Exchange | | of 9.000% Non-C ...

Lincoln National Corporation (NYSE:LNC) Q3 2023 Earnings Conference Call November 2, 2023 10:00 AM ET Company Participants Adam Cohen - CAO and Interim Chief Head, Investor Relations Ellen Cooper - Chairman, President and CEO Chris Neczypor - CFO Conference Call Participants Alex Scott - Goldman Sachs Tom Gallagher - Evercore ISI Ryan Krueger - KBW Mike Ward - Citi John Barnidge - Piper Sandler Jimmy Bhullar - JPMorgan Wes Carmichael - Wells Fargo Wilma Burdis - Raymond James Operator Good morning and thank ...