Lincoln reports strong life/annuity sales, executes with ‘discipline and focus’

Lincoln Financial is enjoying the best of both worlds: executing a business transition while still posting strong sales and revenues.

The Radnor, Pa.-based insurer hosted a conference call with Wall Street analysts Thursday morning. The news is good, reported President and CEO Ellen Cooper, who steered Lincoln through some tough quarters since taking over in May 2022.

“Our fourth quarter performance was strong, with adjusted operating income increasing 31% year over year,” Cooper said, “with our full-year adjusted operating income increasing to its highest level in four years, underscoring the progress we have made as we advance our strategy with discipline and focus across Lincoln.

“This was also our sixth consecutive quarter of year-over-year, adjusted operating earnings growth.”

Investors liked what they heard. Lincoln shares jumped 7% to 8% upon market open.

Lincoln Financial has undertaken a major strategic pivot under Cooper to focus on its core insurance and retirement businesses, strengthening its capital position in the process. Key transitions include selling its wealth management business to Osaic for roughly $700 million, transferring $28 billion of legacy insurance risk to Fortitude Re, and establishing a 10-year strategic partnership with Bain Capital for investment management and a 9.9% equity stake in 2025.

Strong life and annuity segments

Strong life insurance and annuity sales helped drive earnings growth, Cooper said.

Annuities delivered operating income of $311 million, up 3% over the prior-year quarter, driven by favorable equity markets and improved mortality. The annuity segment recorded a record-high $175 billion in ending account balances and sales of $4.9 billion, up 33% year over year.

For the full year, registered index-linked annuity sales increased 35%, fixed annuity sales increased 11%, while variable annuity sales increased 27%, Cooper said.

Annuity sales are likely to be tempered somewhat as Lincoln shifts its focus from RILAs to fixed indexed annuitiess, “where we see a greater, longer-term growth opportunity,” the CEO explained.

On the life side, the segment delivered operating income of $77 million, a $92 million increase from the prior year quarter, driven by improved mortality and strong alternative investment income. Total sales were $142 million, up 19% compared to the prior-year quarter, as sales of accumulation products continued to drive growth.

“It is worth noting that fourth quarter's core life sales included some larger cases, which can vary from period to period,” Cooper noted. “We expect core life sales to grow in 2026 but from a baseline more in line with the earlier quarters of 2025.”

In Other News

Mortality improvement. Life insurance mortality experienced high volatility, with significant spikes in death benefits and elevated mortality rates during 2020–2022 due to the COVID-19 pandemic, particularly impacting younger, insured populations under 70.

While excess mortality persisted longer than expected, it began to stabilize toward prepandemic levels in recent quarters. Lincoln saw favorable mortality to close out 2025, said Christopher Neczypor, executive vice president and chief financial officer.

“Mortality results for the quarter were in line with our expectations,” he said. “You may recall that the fourth quarter of 2024 was pressured by elevated mortality, driven by an outsized impact from severity in our universal life block. We saw that dynamic normalize this quarter, which was the primary driver of the year-over-year improvement.”

Quarterly Snapshot

• Group Protection insurance premiums were $1.4 billion in the quarter, increasing 8% year over year, due to strong sales and persistency. Sales decreased 16% year over year.
• Retirement Plan Services' total deposits were $3.9 billion, up 13% over the prior-year quarter. First-year sales of $1.7 billion were up 32% year over year. Average account balances were $124 billion, increasing 9% from the prior year.
• Holding company available liquidity increased to $655 million at year-end.

Management Perspective

“Over the past two years, we have built important infrastructure to support this business, including our Bermuda affiliate, expanded investment platform and enhanced product features. These capabilities support our go-to-market strategy and position our annuities business for sustained success in an evolving market.”

President and CEO Ellen Cooper on Lincoln’s annuity business

By The Numbers

• Net Income: $745 million ($1.7 billion in Q4 2024)
• Adjusted Operating Income: $434 million ($332 million in Q4 2024)
• Earnings Per Share: $3.80 ($9.63 in Q4 2024)
• Share Repurchases: None
• Dividend Declared: $0.45 per share
• Stock Price Movement: Shares up nearly 8% to $41.52 as of Thursday morning.

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InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.