QVT Issues Second Report on Jackson Financial (JXN) Subsidiary Brooke Life Reinsurance Co. Underscoring Near-Term Liquidity Challenges

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Outlines Key Questions for JXN Management to Answer on its Third Quarter 2026 Earnings Call Scheduled for November 4

NEW YORK--(BUSINESS WIRE)-- QVT Financial LP ("QVT") today issued a second report on Jackson Financial, Inc. (NYSE: JXN), underscoring QVT’s concerns regarding the solvency of JXN’s subsidiary Brooke Life Reinsurance Co. (“Brooke Re”), and detailing its estimates that Brooke Re will face significant liquidity challenges in the coming quarters.

In addition, the report addresses a new issue regarding potential significant overstatement of JXN’s adjusted operating earnings due to understatement of registered index-linked annuities (RILA) option costs.

QVT poses a number of questions for JXN management heading into its quarterly earnings statement and call scheduled for November 4, both with respect to the situation at Brooke Re and the RILA cost issue.

The full second report, Questions for JXN Going Into 3Q 2026 Earnings, which includes the following key questions for management as well as QVT’s analysis, can be found here.

Key Questions for JXN Management:

• What were the line 16.3 receivable, 9.3 payable, and ending hard assets (ex-Hickory Re) in Brooke Re at 9/30/2026?
• What is the interest rate paid on the line 16.3 receivable?
• How do you forecast Brooke Re’s ability to service this receivable over time?
• What capital, if any, is JNL holding against the receivable from Brooke Re, and have you made any evaluation of possible impairment?
• What adjustments, if any, have you made to lapse and withdrawal assumptions due to the recent sharp increase in interest rates?
• What are the lapse and withdrawal assumptions in the MRB model over the last four quarters, and how have those compared to actuals? If there is a persistent gap, why is that gap not corrected by your actuaries or by your auditors?
• Is it JNL’s policy to hedge (either dynamically, or by explicit purchase of options) its RILA exposure?
• Is the interest credited to RILA the full financial cost booked for providing RILA index options?
• If this interest credited is of an order of 0.5-0.6% annually, why is it so much lower than what market option pricing would imply?
• Over what period, and to what amount, is the RILA host contract accreted? For example, for a 6-year RILA, is it accreted over more than 6 years?

About QVT
QVT Financial LP, founded in 2003, is a multi-strategy investment firm based in New York.

Disclaimers
QVT’s funds under management hold short positions in the debt and equity securities of JXN, including through derivatives. Following today’s publication, QVT may, without further notice, increase, decrease, or otherwise change or exit their funds’ positions in the JXN securities at any time, regardless of the views or conclusions expressed in its report. QVT is under no obligation to update the report or to inform readers of any changes in their positions or opinions.

View source version on businesswire.com: https://www.businesswire.com/news/home/20261027057944/en/

Media Contact
ASC Advisors
Steve Bruce / Taylor Ingraham / Cassandra Dasco
sbruce@ascadvisors.com / tingraham@ascadvisors.com / cdasco@ascadvisors.com
(203) 992-1230

Source: QVT Financial LP

Key Terms

registered index-linked annuities financial

A registered index-linked annuity is a long-term insurance contract that promises regular income or a guaranteed minimum payout while letting the contract’s growth be tied to the performance of a market index. Think of it as a savings plan with a safety net: you can share in market gains up to certain limits, but you’re also protected from some losses by built-in rules. Investors care because it blends potential upside with downside protection, affecting retirement income, risk exposure, and how conservative or aggressive a portfolio can be.

impairment financial

Impairment occurs when the value of an asset, such as property, equipment, or investments, drops below its recorded worth on the books. This situation signals that the asset may be less valuable than originally thought, similar to discovering that an item you own is worth less than what you paid for it. For investors, recognizing impairment is important because it can affect the overall financial health and future prospects of a business.

lapse and withdrawal assumptions financial

Lapse and withdrawal assumptions are the projected rates used in actuarial models and financial statements to estimate how often holders of insurance policies, annuities, or similar contracts will terminate, surrender, or take partial withdrawals from those contracts. They drive forecasts of future cash flows, premiums, fees, and liability balances by product, policy duration, and policyholder characteristics; lapses typically mean complete termination or surrender of a contract while withdrawals refer to partial reductions in contract value or benefits. These assumptions are chosen from experience studies and market behavior and can materially change reserve requirements and profitability because higher-than-expected lapses or withdrawals reduce future fee income and change timing of payouts.