Okay, we're going to get going here. Good morning. Welcome to RGA's 2024 Investor Day. It's great to see everyone, and we appreciate your ongoing interest. Now, before we get going, I want to remind you that we will make certain statements and discuss certain topics today that contain forward-looking comments that relate to our future financial performance. Keep in mind that actual results could differ from expected results. A list of important factors that cause any difference is included in this slide. Also, we will make comments on adjusted operating income, which is considered a non-GAAP measure. We believe that this measure better reflects the ongoing financial results and underlying trends of our business. Please refer to the tables at the end of the presentation for information on these measures, as well as the reconciliations to the nearest GAAP measure.
In terms of the agenda, we'll take a short break at 10:00 A.M., and then we'll have a Q&A session, so please keep your questions until the end. With that, I'll turn it over to RGA CEO Tony Cheng.
Good morning, everyone, and thank you for joining us today. We always look forward to meeting with you because it's so important for us to share with you our story. That's because our story is unique. We are the only global reinsurer exclusively focused on life and health risk. Our platform is unique as we have a long track record of reinsuring not just one, but both sides of the balance sheet, and we do this all around the world. This means we reinsure the biometric liabilities such as mortality, morbidity, and longevity, and the asset-intensive form of reinsurance. This unique platform is delivered through our empowered and highly capable local offices. They are unified by a strong RGA culture and connected through a spirit of collaboration that has always been one of our hallmarks for success.
You will see today that this platform confers upon us many strategic advantages that have led to a proven track record of success and positions us for a bright future. We are very well positioned at a time when the industry dynamics are positive for RGA, whether it's the protection gap, higher interest rates, or medical advances. RGA's strength really shines when the industry challenges and opportunities are greatest. That's because the reinsurer with the best talent, breadth of solutions, and broadest and most unified global network is the one that will be most successful in being agile and delivering for our clients. Another hallmark of our success is that we are always passionate about serving our clients, and we work on their biggest challenges and opportunities, often on an exclusive basis. We succeed at this by being an innovation-led organization.
We have created an environment to pilot, learn, and amplify what is working well and to no longer pursue what is less successful. This constant learning is why our people are so highly engaged. They are able to practice their profession in a leading-edge way on the worldwide stage. They not only solve technical problems, but also provide business solutions for the noble purpose of making financial protection accessible to all. For our investors, innovative successes have resulted in a long track record of strong growth and attractive returns. You will see later that this is achieved by increasing our own market share and spurring faster growth in those markets in which we operate. Therefore, the more innovative we are, the greater the value created for our clients and our investors, and the greater engagement of our teams.
This virtuous cycle of innovation has been built up over 50 years, and we know it will continue to be an essential element of our success going forward. We are confident about our future. We have four areas of notable growth, numerous levers to increase value, a unique platform with positive tailwinds, and an innovation mindset with a virtuous innovation cycle. As you know, we currently have strong business momentum that we believe is very much self-sustaining. We are independent, and we partner with the best in the insurance industry to serve our clients. And of course, our success is fully dependent on the quality, dedication, and teamwork of our 4,000 employees worldwide. Let me now share with you some more important details of RGA and highlight some case studies along the way.
NMG is a global consulting company that conducts independent surveys with life and health insurance companies across 50 countries. The information they provide gives us a view of our performance in our key markets and, importantly, benchmarks us against our competitors. Recently, RGA was ranked number one in business capability index around the world for the 13th consecutive year. This is a recognition we are very proud of because it reflects our teams, our culture, and our client partnerships. As you can see in the quote from NMG's CEO, RGA's instinct for innovation is a clear source of differentiation. We are truly global, operating in 25 markets and with clients in more than 110 countries. Our profits are well dispersed, and our technical expertise is embedded around the world. Our local teams are strong, with half our team based outside of the U.S.
You can see from the regional NMG results, bringing the knowledge and capabilities to where the client is and having a clear strategy and culture is why we are leaders not just in one country or one region, but across many and each region in the world. One of our many attributes is the consistency of our culture, excellence, and expertise. No matter which of our offices I am in, whether it's Mexico City, Mumbai, Cape Town, or Seoul, I feel the RGA culture as much as I feel the culture of the country I am visiting. This is testimony to our leadership and the principles and values instilled in all of us. It is also reflective of the fact that our culture of innovation, customer focus, and collaboration strongly resonates with those who join RGA.
This global network of locally empowered offices is one of the main reasons we are the leader in biometric life reinsurance worldwide. As you can see, we are ranked highest of the five major life and health reinsurance players. As you can also see, the relatively concentrated nature of the reinsurance market. This is due to the high quality of each reinsurer and the barriers to entry for prospective entrants to be truly global. This line of business predominantly covers the mortality, longevity, and morbidity, and relies on the heavy expertise of doctors, actuaries, underwriters, and claims professionals. These experts do not just price and manage the long-term risk, but more proactively serve clients by creating new and innovative propositions. In addition to our strength on the biometric side, what sets us apart is that we are equally adept in asset-intensive reinsurance.
We have pioneered this form of reinsurance around the world, and it now represents approximately one-third of our total profits. Our success has not been in just one region, but across all our three major regions as knowledge and solutions are spread across our markets. We are independent. Therefore, in addition to our substantial internal capabilities, we partner externally to ensure our clients receive the best solutions in the timeliest manner. The close relationship between our internal Global Fifinancial Solutions, investment management, and finance teams is critical to our success in winning, innovating, and managing the risk throughout the cycle. Externally, we can partner with the best asset managers or capital providers in the insurance industry to fulfill our goal of serving our clients. Leslie will share more details on the completion manager role we play and the vital connectivity between our asset and liability platforms later today.
Bringing it all together, we are unique as we are the leader in reinsuring both sides of the balance sheet around the world. We believe this positions us to be the trusted partner to clients worldwide. We are unique as we have a global platform of talented teams. We have strong collaboration that links the various offices with each other and the center. We have a passion to serve. We have a passion for serving our clients, and our North Star aspiration is creating market-leading innovations. These attributes that form our unique platform are impactful individually, but incredibly powerful in combination. The synergy between these elements creates four strategic advantages. Firstly, we have constant contact with our clients. On the biometric side, we speak to our clients about underwriting, product development, administration, and claims management on a regular basis.
RGA's strong customer focus means that we aspire to delight clients in all we do. It's therefore not surprising that when the need for capital management arises, we are directly part of those conversations. This multifaceted client partnership means we have deep relationships with clients in many ways, leading to more business opportunities in both biometric and asset reinsurance. Secondly, there are situations where the underlying insurance block or product being sold has both asset and biometric risk embedded within. Therefore, we are able to coinsure or take all the material risk in the product so the client doesn't have to use multiple reinsurers. Thirdly, we take this one step further and create innovative products with risk on both sides of the balance sheet and essentially white label them for our clients. This is our successful product development strategy.
Finally, the constant flow of biometric business enables us to be selective in the type of risk we assume. We maintain our discipline and wait for the right risk-return trade-offs to materialize before executing. Jonathan will provide an example of this later with regards to Taiwan. Let me highlight the power of our unique platform in a case study of a transaction we closed at the start of this quarter. We completed a large Canadian transaction which leveraged a multi-decade client relationship spanning many countries in Asia as well as the U.S. and Canada. When the need arose, we were able to partner with the client to execute an innovative solution. The fact that this solution included both sides of the balance sheet, the asset and biometric risk, meant RGA was very well positioned to provide a complete solution.
Our expertise across multiple technical disciplines, as well as the teamwork between our Canadian and global teams, was outstanding and typical of how we operate. This opportunity was created from the many favorable industry dynamics and tailwinds for RGA. Let me cover this in more detail. Given RGA's talent, platform, culture, and strategy, we are incredibly well positioned to take full advantage of opportunities as they arise. We have built our business on innovation and our ability to anticipate changes in the industry. We are seeing clients rebalance risk. With the expansion of the life and health insurance industry and more refined capital regulations, companies are increasingly specializing in the risk and part of the value chain they know best. This creates opportunities for new business and in-force transactions, which is why we're so excited about our U.S. Traditional business.
Life insurance, longevity coverage, and morbidity protection continues to have massive protection gaps around the world. Until now, governments have partially filled these gaps through Social Security and other forms of benefits. So when you couple this protection gap with the demographic changes of the emerging middle class and aging population, you get an environment that we believe continues to create many opportunities for RGA to innovate in delivering new product solutions around the world. Higher interest rates are also a major stimulus for our pension risk transfer and longevity business, and they also lead to lower premium rates for insurance products, increasing the demand for RGA's biometric forms of reinsurance. And finally, technology, medical advances, and artificial intelligence have potential benefits for our in-force block of mortality. We are studying this issue closely, and Jonathan will share more about this later.
In summary, any changes in any of these areas, and particularly the more technical in nature, play to our strengths, and we pivot and adapt our offerings to best serve our clients. Here's how these industry dynamics create opportunities for us. RGA entered the PRT market in the U.S. at the beginning of 2023. This shows our largest U.S. PRT transaction to date. The PRT market is growing rapidly. This is due to a number of industry dynamics: higher interest rates that make pension funds more fully funded, aging populations, market rebalancing of risk, and medical advances leading to greater longevity. RGA has one of the biggest blocks of mortality risk in the world. So taking longevity risk diversifies our balance sheet.
These blocks also have investment risk, and once again, our capabilities to reinsure both sides of the balance sheet allow us to be a strong player in this market. We have been pleased with the success of our innovative partnership structure with two strong insurance companies. This proactive partnership structure was the first in the U.S. PRT market and gives you a sense of how we are an innovation-led organization. Innovation has been in the RJ DNA from day one. This is just a sample of new products, underwriting solutions, reinsurance structures, and uses of technology that we are proud to have introduced in various markets around the world. Some of these initiatives are brand new. Yet often, they are ideas RJ exports from one market, tailors into another market, and leverages our data and expertise to reinsure the business.
Innovation requires strong business and commercial leadership, but is also every bit a result of RGA being a risk management-centered organization. We only innovate when our business teams are strong, when our risk management teams are strong, and when they are working in close collaboration and partnership. In other words, it is our people who make it all happen through their world-class expertise and ability to find solutions to industry problems through collaboration. Let me now share in greater detail how innovation leads to more engaged teams that leads to further innovation. We foster a culture that facilitates and supports innovation. Coming up with new ideas and pushing them forward and executing is not easy, but our highly creative teams are willing to share their vast knowledge with others and mentor our high-potential talent. That's how we are able to build the next generation of innovators.
RJ has top engagement and low turnover. A big reason for this is that we give the chance for industry-leading professionals to do groundbreaking work, solve business issues, and remind everyone what a noble cause insurance fulfills. Innovation also leads to delighted clients. When we can solve their major business challenges through unique solutions, then their admiration and respect for RJ increases, and this leads to further opportunities for partnership. This is highlighted with a recent example from Japan, where we executed the first material longevity transaction in that market. We are uniquely positioned to support our client here for a number of reasons on this transaction. We have a local presence of nearly 30 years in Japan, which is critical for success in this market. We have built a more than decade-long biometric partnership with this client, ensuring the strong trust and relationship exists.
This can be seen in the client's comments from the press release, where they highly value RJ's partnership due to our consistency and customized solutions. This transaction involves both biometric and asset risk, which means we can provide a solution without any other reinsurer being involved. This example also highlights how our shareholders can benefit from our innovation. RJ's innovation in expanding the use of reinsurance makes Japan a fast-growing reinsurance market, even though it's a stable and mature insurance market. Innovation or reinsurance expansion in a market can dramatically impact a country's reinsurance market growth and our market share. Highlighting the Japan story over the past 10 years, in a slow-growing and large insurance market, the growth in reinsurance has increased. This is due to the use of innovative forms of reinsurance for underwriting, product development, and increasingly capital-motivated purposes.
Given we are the pioneer, we win a larger share of these new uses of reinsurance. This is why in Japan we have raised our market share in this rapidly growing reinsurance market. Japan is the third-largest life insurance market in the world. However, such a dynamic is also happening closer to home. The U.S. is the largest insurance and reinsurance market in the world. We have experienced new growth through the rebalancing of our clients' risk on in-force blocks and with the creation of a full spectrum of underwriting tools and techniques. Going forward, we believe that companies will increasingly specialize in different parts of the life insurance value chain. Therefore, just like underwriting, product development for reinsurers will become increasingly important. So you should now fully appreciate how RGA's focus on innovation has and will continue to delight our clients.
This leads to further transactions, further engaged employees, stronger growth and returns leading to further innovations, and the virtuous cycle continues. Let me illustrate this directly in the next example. This time last year, I shared the story of a breakthrough product in China that was launched in late 2022. I wanted to update you on what this breakthrough means for RGA and its business. Over the past 12 months, we were able to complete variants of this new product with 11 other Chinese clients. In addition, we created a spinoff medical product that complements the initial simplified issue critical illness product. This gives us greater belief that the simplified issue line of products will become a full suite of offerings in China as populations age.
This follows the same trend we saw in South Korea five years ago, where the population is about, on average, five years older than in China. It highlights how RJ takes the learnings, data, and solutions from one market and proactively executes in another market when the demand begins to emerge. This example also illustrates how success breeds success and creates this virtuous innovation cycle. Last Investor Day, I highlighted four areas of notable growth. I want to now go through each area to provide more depth and give you a sense of where we are headed into the future. These four areas of notable growth are U.S. traditional, longevity PRT, Asia Asset Intensive, and Asia Traditional business. These businesses represent approximately three-quarters of both our PTAOI and our new business value creation and are four of the fastest areas of growth within the company.
I'll highlight examples in each of these. Turning first to the U.S. Traditional business. Over the past 50 years, we have evolved from solely focusing on heavy-touch facultative underwriting into supplemental underwriting programs and then to the other end of the underwriting spectrum in expanding our digital offerings. Our market-leading teams and our ability to offer the full spectrum of underwriting services makes RGA one of the leading life and health underwriters of any insurer or reinsurer in the U.S. This positions us extremely well for the future. Companies are increasingly specializing in various parts of the value chain. RGA already provides solutions in the product development and underwriting space, which are two critical parts of this value chain. Given RGA's brand and relationships, we are fully equipped to complement this by bringing partners in other parts of the value chain together to best serve the end consumer.
This is highlighted in the next example. We brought the distributor to the insurance client and created the underwriting and final expense product. This required knowledge of old-age mortality and ability to design the product to cater for the low level of underwriting, as well as to take the asset risk in this product. All parties involved were delighted with this transaction and the potential growth that will eventuate. In addition, the client was so thrilled they asked for an additional transaction in a different type of reinsurance, which we successfully helped them with. Turning to the longevity and PRT business, which is our second area of notable growth. I have highlighted today how we have transported our longevity expertise to the U.S. and Japan to win exciting transactions. However, our biggest longevity business is very much still in the U.K.
This transaction was one of the largest longevity swap transactions in 2023. It was successful due to excellent technical capabilities of the team and also the relationships they built with the pension fund leading up to the transaction. The trust in the execution certainty, strong credit rating, and trust the brand of RGA goes a long way when insurers are deciding where to place long-term pension liabilities. In addition to the large transactions, we have also used technology to automate pricing for the smaller schemes and in RGA's digital underwriting solutions in the individual retail annuity market. These uses of technology add to our already strong offering in the UK longevity market. Let's now turn to two examples in our fastest-growing region, Asia. First, our asset-intensive business. For nearly a decade, we have assisted a major client through multiple reinsurance transactions as they rebalance risk and manage their capital.
This started in anticipation of the new capital framework in Japan. Our strong brand, the same consistent team and offering have made RGA their main choice of reinsurance partner for these very important transactions. Given this company is a market leader, it has meant other insurers have looked at and completed similar transactions, and there is no reason to believe other Asian markets will not follow in a similar fashion down the road as regulations change. Finally, turning to our Asia traditional business. This brings a lot of what I have said this morning together. Firstly, industry dynamics are creating opportunities, which are aging population, protection gap, the new RBC capital regime, and Chinese people returning to Hong Kong to buy insurance policies.
Secondly, RGA innovating through our unique platform led by a 200-strong local team noted for their more than two decades of product development leadership, strong client partnerships, and the capability to reinsure both sides of the balance sheet. Over the past 12 months, we have innovated our solution to reflect the new capital framework that was recently launched. Similar to our U.K. longevity story, we more recently added another dimension to our offering through technology, which facilitates the underwriting of people from mainland China into Hong Kong. We believe we have so many dimensions of differentiation that makes our business here fast-growing and high-margin with strong contributions to the insurance industry. Given the free economy nature of Hong Kong, these holistic and comprehensive reinsurance solutions are the most advanced that we deliver in Asia.
However, other markets are following the same evolution as Hong Kong, and these other markets are much larger in size. We are clearly excited by the prospects of rolling out this strategy to the rest of Asia as markets evolve over time with regards to regulations and better understanding of the potential uses of reinsurance. We have shared a great number of innovative new business wins, but creating long-term value involves other management actions besides winning new business. When RGA has treaties that are not performing well as well as expected, we will always take a partnership and holistic approach to these situations. We will look at the whole relationship across multiple countries and consider the new business production that client is providing us. We feel this approach is a means of differentiation leading to other business opportunities.
RJ is continuously active in seeking alternate sources of capital, as Todd will elaborate on later. We approach finding alternate sources of capital with the same mentality of technical discipline, collaboration, and finding innovative approaches to ensure we have the capital in the forms that are most effective in supporting our needs. Secondly, we have also taken a more proactive approach in redeploying our resources. For example, we moved resources away from our lower-growth EMEA Traditional area to higher-growth areas of the company. This, most importantly, sharpens our focus in EMEA towards our global financial solutions and major regional and global accounts. Additionally, due to recent investments in systems and improved processes, we have executed opportunities to reposition assets into higher-yielding areas that generate meaningful additional profit in future years. Finally, we continue to create alternate sources of fee income through partnerships.
For example, with sidecar vehicles and the origination and asset management roles we play. All these various management actions are lumpy in their impact individually and not overly major in size, but collectively, they add materially to our value. They are just one of the multiple levers we have to grow value, profit, and ROE. Let's take a look at the other levers at our disposal. These relate to new business generation. Firstly, the more new business we win above our target pricing, the greater our earnings power going forward. We have had strong wins in new business, especially over the past 15 months, which will add value and profit and generate higher returns and further transactions. Secondly, we have shared many recent examples of innovative forms of new business. These transactions do generate a higher return for RGA given the greater value created for all parties.
Of course, the greater the proportion of transactions centered around innovation, the greater the value created for the enterprise. Our third lever for growth comes from increased focus on our growth areas. As mentioned earlier, about 75% of our growth in value comes from four areas of notable growth, which also happen to be our areas of greatest innovation. We continue to actively redeploy resources to these areas to generate higher returns and growth for the overall company. In summary, you can see we have a strong momentum with a virtuous innovation cycle that we believe will perpetuate and sustain our success going forward. We believe everything in RJ works together, and everyone has an important role to play.
Given we are exclusively life and health-focused and have grown organically, we have a consistency in our culture and understanding of what has already and what will continue to make us successful. Having a unique platform to take advantage of the favorable industry dynamics is only optimized if we have the proactive business mindset and courage to execute a culture of innovation. We have increasingly become focused on four areas of notable growth, but by no means have we forgotten the other areas, as we saw with our success in Canada earlier this quarter. We understand our balance sheet and the various levers, and this means at the right time we will proactively unlock value.
Our confidence in our future is made possible by what I expressed in my opening words today in that life and health reinsurance is our business, and we are exclusively focused on it and understand it deeply in all parts of the world. The final and most important reason that we are so confident about our future is our people. I am truly honored to lead this great organization as the third CEO in our 50-year history. To help our clients provide consumers protection, to help insurance industries grow, and to assist the transfer of savings into productive industries is something we are immensely proud of. However, what makes me most proud and what anyone at RJ will say makes us special is our people.
The talent, the dedication, the discipline, the passion to serve, and the courage to innovate are all aspects of our team that make this role as their leader so humbling. We have created and will perpetuate this culture going forward, knowing that this is the best way we can delight our clients, our shareholders, and our people. I would now like to pass it on to Jonathan Porter to commence his section. Thanks, Tony, and good morning, everybody. Today, I'm going to be providing an overview of RGA's approach to risk management and share some insights into our diversified business profile, as well as our view of recent and future mortality trends. Risk management is one of RGA's core competencies.
This has been proven through our actions and results over decades, through strategically allocating capital to a mix of risks, accurately assessing and pricing new transactions, and successfully managing through industry-wide adverse events. We understand risk, and this puts us in a strong position to continue to grow and support our global clients with new and innovative solutions. Our recent biometric experience has been favorable relative to our expectations, and we see some promising medical advances on the horizon. Future biometric trends are always subject to uncertainty, a key reason why our clients reinsure their business with RGA. We devote significant resources to analyze developing trends and data, both to create risk insights and to enhance our brand and value proposition to our clients. We are a global risk leader in life and health reinsurance, and our risk management and technical capabilities are key strategic differentiators.
Our strong risk culture and well-established governance framework form the foundation that underpins all of our decisions. This foundation, when combined with our diversified risk profile, strong capital position, and breadth and scale of our global operations, allows us to deliver significant value to all of our stakeholders while dynamically managing our business. A strong risk culture is at the center of everything we do at RGA. Our risk framework is a lens through which we make all of our decisions. Risk management is the responsibility of all associates and is core to how we operate as an organization. Our governance practices are well-established, and we have clearly defined risk limits. These align with our long-term strategy. We regularly assess new and evolving risks and perform scenario testing on both sides of the balance sheet to understand the impact on key financial and non-financial metrics.
This information is a key input into short-term and long-term decision-making. We're disciplined risk takers, leveraging our strong technical expertise to provide us with a competitive advantage in risk evaluation. Understanding what new business opportunity to pursue, and perhaps more importantly, what new business opportunity not to pursue, is critical to our success. In a minute, I'll share an example of this discipline in action. We have active monitoring programs in place to assess our business results relative to expectations, both as a feedback loop for the new business pricing process, but also to inform proactive enforced management actions. The combination of all the elements of our risk management program positions us well to successfully navigate through future uncertainty and to take advantage of opportunities that this uncertainty can create.
This example highlights how we remain disciplined in the face of competitive pressures after our analysis identified concerns with an insurance product being sold in Taiwan. We didn't believe the product was sustainable given the underlying pricing and concerns on some aspects of claims definitions. We therefore chose not to reinsure this product, which had a short-term impact on our market share and competitive position. Eventually, the product started experiencing financial losses and claims disputes, which led to a need for the product to be redesigned to make it more viable. RGA's focus on long-term value creation and risk management, as well as our commitment to the sustainability of the underlying insurance market, was ultimately viewed positively. This case study is just one of the many examples that highlights the power of combining technical expertise, long-term thinking, and a disciplined risk management approach to decision-making.
Here's an illustration of different views of our well-diversified business profile. The chart on the left-hand side shows our Pre-Tax Adjusted Operating Income by region, demonstrating that we have a well-balanced set of meaningful global businesses. This position is a result of conscious geographic expansion over decades. The chart in the middle also shows PTAOI, but this time split between traditional and Financial Solutions businesses. Profits are evenly balanced between each business, and the value of having uncorrelated sources of earnings was clearly demonstrated during the pandemic. The chart on the right-hand side displays our biometric risks: mortality, morbidity, and longevity, based on our own internal economic capital model. Given the opportunities in the market, and as we expected, the relative weight on longevity risk capital increased from 12%-15% year-over-year.
Our current strategy anticipates future growth in all of our biometric risks, with modest increases in the proportion of longevity, resulting in a more balanced risk profile over time. However, given the substantial size of our in-force book of mortality business, we expect it to remain our predominant biometric risk for the foreseeable future. Diversification has real value and brings multiple benefits to the RGA platform: better capital efficiency, natural offsets so that when earnings from one risk or geography are under stress, other businesses' performance can help support aggregate income, and optionality to pursue opportunities where we see best risk-return profiles. We can do this because we are not overly dependent on any one source of new business or profit. Although there is a level of uncertainty in the current market environment, higher interest rates are expected to continue to be a net positive for RGA.
After many years of declining rates, the increases in 2022 and 2023 have led to multiple benefits for our business, including higher investment income, a stronger new business transaction pipeline, and higher potential demand for retail protection products from consumers. Higher interest rates can also lead to higher lapses on savings products. We expected and have seen a modest level of higher lapses on our fixed deferred annuity products, but these have not had a material impact on our earnings or risk profile. Overall, RGA's balance sheet is less sensitive to market changes due to our higher weight on biometric risks, as well as our relatively low exposure to interest-sensitive liabilities.
Only 9% of our net gap reserves are exposed to higher policyholder behavior risk, meaning that our liability cash flows are relatively predictable, allowing us to better manage through market cycles without being a forced seller of assets when market values are depressed. Our proactive approach to asset liability management starts from the very beginning of evaluating new business opportunities. At the time of initial pricing, significant effort is spent to understand the liability profile and develop a tailored asset solution that will meet our needs over a range of future market conditions. In a few minutes, Leslie will cover the disciplined approach that we follow to balance risk and return across our entire portfolio. With our focus on biometric risks, long-term mortality trend is one of RGA's most important assumptions.
Our globally diversified platform, with substantial mortality and longevity books of businesses, positions us well in a variety of future scenarios. But to be clear, if mortality improvement is better than expected over the long term, we would anticipate that this would be a net benefit. This slide provides an overview of the past, present, and some promising advances that could impact the future of mortality trends. The chart on the left shows the decreasing trend in age-adjusted general population mortality rates for a variety of countries over the past several decades prior to the onset of the COVID-19 pandemic. The key takeaway here is the persistent and long-term trend toward improving population mortality. Although you will also note that the rate of change has varied from year to year and from market to market, the primary drivers of mortality improvement have also varied over time.
There have been some adverse trends, such as rises in population obesity levels and substance abuse-related deaths, but these have been more than offset by favorable drivers, including improvements in the treatment of cardiovascular disease, automobile safety, and other medical and technological advances. The chart in the middle shows the excess mortality experienced in the U.S. population over the past four years, primarily related to the COVID-19 pandemic. Other countries show similar patterns, although the timing of COVID-19 waves varied from market to market, with some countries continuing to experience more elevated levels of post-pandemic mortality. The key takeaway from this chart is that while uncertainty remains about the near future, we have seen a substantial moderating of excess mortality and are nearing pre-pandemic levels in the U.S.
We do expect elevated levels of mortality to continue for the next few years, and those expectations are reflected in our best estimate reserve assumptions. I will also point out that our recent biometric experience has been favorable relative to those expectations. The final panel on the right of the slide hints at some of the promising advances on the horizon, which could have a meaningful favorable impact on long-term mortality trends. Let's take a look at those now. The global trend of rising obesity over the past several decades has been well documented. Excess weight is estimated to cause as many as 500,000 deaths annually in the U.S., and the steady rise of BMI has curtailed mortality improvement materially. New obesity management drugs are offering unprecedented improvements in diabetes control, with mounting evidence of decreased cardiovascular risk and improved health outcomes in both diabetics and non-diabetics.
These treatments are expensive and may require lifelong use, but it is expected that the use of GLP-1 or similar emerging drug classes will continue to expand as access improves from lower costs and wider availability. While there are some caveats around the possibility of unknown side effects for long-term use, our current view is that mortality improvements related to obesity treatments could be a measurable benefit in the next five years. Precision medicine is another area of promise, with multiple new technologies available now or on the horizon. Genetic advances allowing for individualized diagnoses and care of multiple diseases, including cancer, are already available. Next-generation cholesterol treatments may help to improve medium-term cardiovascular mortality. That's an area we've seen improvements flatten in recent years.
Advanced protein science is a breakthrough, leveraging the power of artificial intelligence that, while still in the early stages, could lead to longer-term benefits in diagnostics and targeted therapeutics. A multi-cancer early detection test, or liquid biopsy, is a screening tool that can identify cancers at multiple stages, including earlier ones, using bodily fluids. These are expected to lead to improvements in cancer mortality within the next 10 years if uptake continues to increase. Artificial intelligence is expected to impact many elements of our daily lives, and healthcare is no exception. AI has been used in medicine for a number of years for things like enhanced review of X-rays, and we expect these trends to continue. Next-generation AI capabilities are starting to be applied across the board in all fields of clinical and research medicine. The expected benefits include improved diagnostics, telemedicine, and therapeutics.
Growth in use cases should be exponential in the coming years, realizing potential benefits within the next 10 years. It's important to also remember that mortality improvement can be volatile, and there are many interactive factors, both positive and negative, that will impact future trends. Today, I've highlighted a few of the promising areas that we're monitoring, but we are also closely following potentially adverse developments like healthcare system strain, alcohol and drug abuse, and long-term climate change that could negatively impact future mortality. There will always be a degree of uncertainty, but on balance, we're optimistic about the potential that medical and technological advancements will have in the prevention, detection, and treatment of diseases, and ultimately to improvements in long-term mortality.
Throughout our more than 50 years in the life reinsurance business, we have amassed data and expertise to analyze, understand, and price risk, turning uncertainty into profitable new business opportunity. As Tony highlighted in his remarks, RGA has many actuarial, underwriting, and medical professionals around the world, about 30% of RGA's total global workforce. These resources, in conjunction with data scientists and other research specialists, are constantly looking at emerging medical and insurance industry data, as well as our own experience to generate thought leadership that not only informs our pricing and risk management activities, but also reinforces our brand as an industry innovation leader. We are biometric risk experts, and I'm very pleased that RGA has ranked number one in thought leadership and knowledge for seven consecutive years on NMG Consulting's global life and health reinsurance study.
To sum up, I believe that our approach to risk management sets us up for sustained success. RGA has a strong risk culture and proactive approach to risk management, which we have demonstrated through multiple stressed environments. We apply our technical expertise in a disciplined manner to ensure risk is accepted at the appropriate level of return, resulting in a well-balanced and diversified portfolio of global risks. Recent improvements in mortality and higher interest rates are net tailwinds for our business, and our leading research capabilities provide critical insights into future trends and enhance our brand and overall client engagement. These factors, combined with the strength and capabilities of our global workforce, make me confident about RGA's bright future. I'll turn it over to Leslie Barbi now, Executive Vice President and Chief Investment Officer. Thanks, Jonathan. Good morning. Thanks for coming.
RGA is globally renowned for our deep biometric and liability expertise. As Tony said, we're also a leader in asset-intensive reinsurance. We can provide more holistic solutions because of our ability to reinsure both sides of the balance sheet globally. I'd like to share some insights about the advantages and breadth of our asset capabilities and how our robust completion platform strongly contributes to RGA's success in winning new business and in delivering long-term value. Our completion platform is a strategic advantage, engineered to deliver a comprehensive suite of capabilities and assets needed for our formidable reinsurance business. These capabilities are deeply integrated, aligned, and customized for RGA, our mission and our strategy. That positions us for growth and drives our expert asset liability management and execution. And we have differentiated access to assets through our own teams and through our strategic approach to working with external partners.
We're part of multidisciplinary teams who collaborate closely, exchanging insights and analysis related to the characteristics and sensitivities of liabilities and transaction features. Together, we deliver cohesive solutions tailored to our new business and our enforced liabilities, and we jointly foster sustained success over the lifecycle of the business, which can span decades. Our experienced investment professionals have successfully managed through cycles. This fortifies our investment strategy, which balances risk and return to build portfolios that weather cycles. Our proven strategy is founded on disciplined underwriting and ongoing diligence and embraces our well-established investment and enterprise risk management frameworks. Most of our assets are sourced and managed by our own teams. This achieves a deep alignment of purpose, risk management, and results. It's important to highlight our substantial private asset capabilities, which we have been developing for over two decades.
We have a long and strong track record of continuously developing and enhancing our platform, of delivering on what we promised in our integrated solutions, and of managing in a way that supports RGA's financial strength because long-term success matters. Our global and local resources and the assets we source and manage support RGA's client solutions. Here's a few indicators of the effectiveness of our strategy. Our assets have grown about 14% annualized since 2007. We now internally manage about 87% of the portfolio, more than double the portion in 2007. That increase occurred as assets grew and as we expanded globally, demonstrating that our asset capabilities have been an integral part of the growth and evolution of RGA's business. The map shows the portion of the assets supporting business in various regions, which speaks to our significant global footprint.
Our portfolio mirrors our philosophy and the diversity of our business. Our investment strategy strikes a balance between risk and return, designed to withstand various market cycles. Strong credit underwriting is a cornerstone of our approach. We successfully created and sustained a high-quality, diversified investment portfolio. We've done that while also targeting asset strategies well aligned to the specific characteristics of the liabilities and the types of business that we reinsure. That's important because the actual goal is an overall resilient business with well-matched assets and liabilities and embedded risk management. Our proactive asset liability management starts with a deep assessment of liability characteristics and potential variability. To ensure long-term resilience, we design our asset strategies and monitoring and action plans around cash flow matching, as well as other potential liquidity considerations and relevant transaction features.
We have a disciplined asset management approach governed by well-defined risk limits, which also reinforce strong diversification both across and within asset types. To enhance value, we reposition to capitalize on changing market conditions. We pursue returns as aggressively as is reasonable given the liabilities, with a focus on managing risk well and weathering cycles. It is about returns. It also is always about risk and resilience. A benefit of our in-house capabilities is that we can execute on opportunities and manage risk with greater timeliness and precision. Earlier, Jonathan discussed our stable liability profile. That profile means we do have opportunities to capture additional illiquidity premium as compelling opportunities arise, particularly in relation to our liabilities with the least variability. To deliver the results, we have a talented global investment team located across North America, the U.K., and Asia, with experienced leaders who average 26 years of investment experience.
I can tell you from my own experience over the last three decades how impactful it is to have seasoned investors at the helm who have successfully navigated multiple challenging economic and market cycles. That track record and judgment reinforces the wisdom of our disciplined, risk-minded approach. We have a broad platform with a number of our key capabilities listed here: portfolio management, investment solutions, ALM, hedging, modeling. I want you to note our strategic initiatives and partnerships capability. That includes the strategic partnerships we develop and negotiate that add to our distinctive sourcing capabilities. We also have an external manager selection and oversight capability. We use this formal audit process when we hire external managers for specific mandates. What might catch your eye about the other two columns, the major types of public and private assets on our platform, is the substantial breadth of both.
Our completion platform is a strategic advantage. We built it to be an integral part of RGA's business, focused on delivering whatever is needed to best position RGA for success. Our platform is deeply integrated across RGA capabilities, with holistic analysis linking our asset strategies to our liabilities at inception and over the life of the business. Our broad platform gives us the necessary ample opportunity set to customize our solutions and pursue returns while managing risk. And we have differentiated access. While RGA investment professionals manage most of the assets, we're agnostic about the exact percentage. The highest priority is what adds the most value for RGA. We leverage internal and external sources of assets to best match RGA's business needs. Internally, we have well-established expertise across a broad spectrum of public, private, and alternative equity assets.
Additionally, we're strategic in the way we access and integrate external partners and capabilities. Once we identify an asset type or capability that will enhance the platform, we also assess whether it makes the most sense for us to do it or whether using an external partner would be optimal. That's where the strategic partnership and external manager capabilities come in. Currently, we have more than 15 external partners across these two categories. I'll talk further about a few of them shortly. My assessment is that we are unique in the combination of our deep integration, the breadth, depth, and sophistication of our internal capabilities, and our successful approach to further enhancing the platform with external partners. This timeline of private asset milestones showcases what we've achieved over the last few decades with a box for each private asset type we've added to our platform.
I'll walk through a few examples here and later share additional results related to our significant, long-established capabilities in real estate and in private debt and equity. The first box on the left is when we started investing in commercial mortgage loans, or CMLs, in 2003. Originally, we engaged an external partner, but as we built the RGA team and capabilities, we began originating loans ourselves. What was then a $1 billion portfolio is now $7.6 billion as we continue to commit to growing the talent and resources needed to originate and manage these loans. Note that we also started investing in real estate equity more than a decade ago, in 2012. Following a similar path of RGA capabilities build-out, we originally launched our investments in private equity and mezzanine funds back in 2007.
As we put resources in place, we expanded into lower-middle market lending, which, like our CMLs, is sourced, underwritten, and managed by our internal team. There's many other boxes that reflect excellent internal capabilities, but let me share a few examples where we strategically work with specialty managers externally. One is aviation lending. The other is fund finance. In 2020, when aviation was under stress and when European bank lenders were already pulling back because of regulatory reasons, we collaborated with an experienced partner to invest in relatively low LTV loans on narrow-body planes that were in high demand at the time. We were able to capture hundreds of basis points of excess spread because we were able to attract and choose a strong partner, evaluate the investments, and make the loans while the opportunity was still available.
In 2022, we publicly announced our strategic partnership with Velocity Capital Advisors, which includes a minority stake in Velocity. This relationship gives us access to seasoned investors with broad loan sourcing networks in the fund finance space. As expected, the strategic partnership has delivered well-structured investment-grade loans at excellent risk-adjusted yields while also growing the enterprise value of the asset manager. That should give you a flavor of some of the differentiated access internally and through strategic partners. Here I'll spotlight our commercial mortgage loan capabilities and results. Our experienced team has managed well through cycles, and they originate the loans we put in our portfolio, with nine regional offices providing boots on the ground, local expertise, partnership, and surveillance. Our internal end-to-end capabilities mean it's our own team that sources, underwrites, services, and manages the loans and engages with our borrowers.
Most of the metrics here on our high-quality portfolio have been shared in the earnings materials. That's around the significant equity cushion beneath our loans and the diversification by property type, geography, maturity, and the small average loan size. The important news on this page is the number 90. We've added more than 90 basis points of excess spread above public corporates over the past 12 years, a testament to our seasoned team and strategy. In terms of balancing risk and return, this is an excellent outcome. Next, I'd like to spotlight private credit. Launched more than 10 years ago, our private debt and equity group is led by seasoned investment professionals with strong industry relationships and a disciplined underwriting process. They deliver our substantial capabilities in sourcing lower-middle market loans along with expertise in fund and direct equity investment.
Our private credit portfolio has strong credit characteristics, and it's well-diversified, and it's now grown to $1.9 billion. The results have been impressive. We've successfully captured significant risk-adjusted returns, delivering a realized internal rate of return of over 12%. The impressive credit results across our total portfolio are another testament to our capabilities. Over the past decade, our annual impairments have averaged less than eight basis points, highlighting our effective risk management and sustained credit diligence. A significant advantage of our private asset capabilities is the alternative equity portfolio that we have strategically developed over many years, primarily consisting of real estate joint ventures, private equities, and other funds. The returns we generate from the selection and management of these investments drive the majority of our variable investment income.
These investments have notably punched above their weight over the past 5 years, as what's now about 3% of the investment portfolio contributed about 7% of the realized operating income investment income. Part of the period benefited from a particularly strong environment. On a go-forward basis, we're expecting 10%-12% annual rate of return on this portfolio. Near term, we do expect somewhat lower returns, recognizing the current environment. I believe the next few slides bring to life how our powerful platform is contributing to RGA success. Given our comprehensive suite of capabilities, we've been able to bring over 70 basis points of expected excess spread above index rates to the portfolio strategies we design and deliver on new transactions. This is primarily from our internal capabilities, our private asset originations, plus other capabilities in asset allocation, public assets, and security selection.
There is a portion that comes from the additional strategic partnerships we forge and the external managers we select. We're objective about how we source assets and other capabilities. Our guiding principle is to always pursue delivering the best possible completion platform for bolstering RGA's competitive edge and our client solutions. Tony talked about this earlier, but I think it bears repeating. You'll notice it highlights our comprehensive suite of asset capabilities that are an integral part of RGA's strategic advantage and of our ability to deploy holistic innovative solutions around the world. As a proof point, I'd like to highlight our successes in an area where asset capabilities are critical to our ability to compete and to provide excellent solutions. In asset-intensive transactions, we've achieved considerable success around the globe.
Here are five deals that we closed in 2024 through early April that have been publicly announced, and they total over $10 billion on a U.S. dollar equivalent basis. They say a picture is worth a thousand words, and in this case, I do think the success map sums it up well. I'd like to share another validation of our asset capabilities. It relates to Ruby Re. In December, we publicly announced the launch of Ruby Re. Todd will share more information on this reinsurance company and how this form of alternative capital fits into our capital management strategy. What I want to touch on here is third-party asset management. RGA is the completion asset manager for Ruby Re, and we'll earn an asset management fee for that service.
The strategic lead investors shown here are each large and sophisticated, and they have thoroughly vetted RGA's capabilities around the asset-intensive business that we originate and that can be reinsured by Ruby Re. This included an in-depth evaluation of our asset capabilities and our ability to deliver the results needed in these types of transactions, and they invested. That external validation is very gratifying for us. Our portfolio yield benefits from our broad platform. In the first quarter, our non-spread new money rate was 6.12%, well above the portfolio yield of 4.75%. The investments we're making in the current environment are running at a similar or slightly higher level, so that should continue to support our portfolio yield and be a tailwind. In conclusion, I hope you've gained additional insights about the strength of RGA's investment capabilities. RGA excels at creative solutions, including both assets and liability risks.
Our completion platform is built for sustained success. My assessment is that we are unique in the combination of our deep integration, the breadth, depth, and sophistication of our internal platform, and our successful approach to further enhancing the platform with external partners. RGA's team is experienced, disciplined, and recognized for excellent execution. We have a long track record of continually developing and enhancing our platform, of consistently delivering on what we promised in these integrated solutions, and in managing in a way that supports RGA's financial strength because long-term success matters. What we have built and continue to build brings value to RGA's clients and stakeholders. Looking ahead, we're well-positioned to capitalize on the expanding opportunities and momentum that you heard about today because we built this substantial platform customized and aligned to RGA's strategy. And that's why I, too, have a lot of confidence in our bright future.
And now I'll turn it over to Todd Larson, Senior Executive Vice President and Chief Financial Officer. Thank you, Leslie, and good morning, everyone. I'll provide a financial overview and expand on the benefits of our unique platform. We've recently reported very strong results. As you have heard this morning, we continue to see healthy growth opportunities across our business. Over the years, we've grown and built our business to be well-diversified, both by geography and by product. This success would not be possible without an active and balanced capital management strategy, a strong balance sheet, quality investment portfolio, and stable liability profile. RGA is a long-term business. It is important to note that our recent results reflect the experience and contributions from the business that we put on our books over many years.
One thing that we are particularly proud of is that we've consistently grown book value over time. This reflects our successful strategy execution while absorbing challenges that we faced along the way. Additionally, we have significant expected future value from business already on our books. This value will be recognized into income in the future. RGA has established itself over a long period. We have a unique and differentiated position as a leading global life and health reinsurer. We expect to continue to produce attractive financial results well into the future. Also, we expect to continue to create long-term value for RGA shareholders, demonstrated by the increase in our value of in-force. We have established intermediate-term financial targets of adjusted operating earnings per share growth of 8%-10% and 12%-14% adjusted operating return on equity.
We are confident that we will meet these targets and likely to be towards the upper end of the return on equity range. We had a record year in 2023. Our adjusted operating earnings per share, excluding notable items, was $19.88. These earnings reflected solid performance across our business segments. We benefited from strong new business, a tailwind from higher interest rates, and favorable experience. Adjusted return on equity was 14.5% for 2023, and when excluding notable items, adjusted return on equity was 14.4%. For the trailing 12 months through the end of March of this year, adjusted return on equity was 14.8%. We are very proud of these results. As you can see, we emerged from the pandemic with significant momentum and a powerful earnings engine. This is a testament to the strength of our global operating platform and talented teams across the globe.
We are happy with our premium growth over time and believe that we can continue to produce similar results in the future. In 2023, our traditional premiums grew 5.9% on a constant currency basis, including contributions from our global financial solutions business, which includes the impact from the U.S. PRT transactions throughout the year. Premiums grew 16.3% on a constant currency basis. Considering the favorable industry dynamics and our unique competitive positioning, we expect to continue to grow traditional premiums in the mid to high single digits. In 2023, operating revenue grew at 14.5% on a constant currency basis. We'd like to look at operating revenue, which includes premium as a good measure of our traditional business, as well as other forms of revenue such as investment income and fee revenue that capture certain parts of our global financial solutions business.
This strong revenue growth is a demonstration of our good business momentum and continued benefit from higher interest rates. The map here shows our 2023 pre-tax adjusted operating earnings by geography. This strategic build-out of our business has produced strong and diversified underlying earnings power. Our global financial solutions business has grown to be a substantial portion of our overall earnings and continues to perform very well. We have been successful in leveraging our capabilities in several regions and products across other parts of the world. This is especially true for our longevity experience in EMEA, which, as Tony mentioned, we exported to both the U.S. PRT market and a client in Japan. Another example is we utilized our U.S. asset-intensive expertise in several other regions of the world. This demonstrates the diversification of our earnings power. We expect this to result in more earnings stability over time.
As mentioned, we achieved a 14.4% return on equity in 2023. The primary drivers of this recent growth were favorable impacts of higher interest rates, strong new business, favorable experience, and certain other favorable items. This is reflected in the chart where you can see the expansion of underwriting margins coming out of the pandemic. This includes impacts from strong new business and favorable underwriting experience. Investment margins have also grown with the recent interest rate environment tailwind. While we don't necessarily expect all of these items and tailwinds to repeat or remain as strong in 2024, we are comfortable that our current intermediate-term adjusted operating ROE target of 12%-14%. We are confident that we can continue to deliver favorable returns over time, most likely at the higher end of the ROE range. RGA has demonstrated attractive book value per share growth over time.
As we have seen through various cycles, RGA's differentiated position as a pure-play life and health reinsurer allows us to place our full focus on our life and health clients. We do not get distracted by non-core lines of business. Our deep technical expertise and innovative services and solutions have helped expand our capabilities. We have leveraged these capabilities to help our clients provide affordable and appropriate life and health protection products to the market. We have a long-term focused investment strategy that balances risk and return. Coupled with effective capital management, we believe that we will continue to grow book value per share at an attractive rate. We have a strong balance sheet and maintain a consistent capital structure over time that supports our business. Our balance sheet combines a quality investment portfolio, stable liability profile, and significant expected future value of in-force business.
We also maintain ample liquidity, and our financial leverage ratios are within our targeted ranges. We believe our balance sheet is well-positioned to build on the recent momentum and continue expanding our earnings power. Our organizational structure has evolved over time to meet our clients' needs and provide financial and operational efficiency and flexibility. RGA has multiple legal entities made up of a holding company and operating companies domiciled in our key markets. RGA's organizational structure is multi-layered and allows capital to be more fungible across the enterprise. From a consolidated perspective, this structure provides flexibility to support our growth and maintain our competitive position. At the holding company, we target funds of 1.5 years of dividends and interest. RGA has a syndicated credit facility that we can use for cash borrowings and letters of credit to support our business.
Effective capital management has been integral to RGA's success and remains critical to executing on our growth strategy. We have multiple lenses for which we view our capital. One objective of our strategy is to manage capital efficiently, taking into account all the different requirements. RGA manages several capital frameworks. These include multiple regulatory and rating agency frameworks and our internal capital model. Each one has its own methodology, reporting requirements, and stakeholders. From a regulatory perspective, we maintain capital at RGA's operating companies to support their solvency, to be deployed into organic new business, deployed into Enstar transactions, and to support our strong ratings. In addition to local regulatory capital, we also report on group capital to our lead supervisor. Beyond regulatory frameworks, we maintain capital at appropriate levels to support our targeted financial strength ratings.
We are committed to maintaining these ratings as it is important for us to remain a strong counterparty for our clients. Also, we adhere to our own internal economic capital framework. This underpins our enterprise risk management and supports our strategy execution. It is important to note that across each of these capital views, RGA is well-capitalized and maintains strong levels of solvency. After consideration of these frameworks, we have ample dividend capacity available at our operating companies to upstream to the holding company, and we take this action as needed. At the end of the first quarter, we had over $1 billion of operating company dividend capacity available. As a consistent theme, our capital management strategy includes maintaining capital flexibility. This includes our ability to raise alternative forms of capital in addition to traditional debt and equity.
We have been efficient in funding our growth using alternative forms of capital, including the issuance of surplus notes, embedded value securitizations, and execution of strategic retrocessions. Most recently, we successfully launched Ruby Re, a Missouri-domiciled third-party reinsurance company, which I'll expand on shortly. We like alternative forms of capital. It generally places the financing at the operating company level where there is cash flow to fund the cost. This takes pressure off the holding company. We are in the business of helping our clients manage their capital, which we believe is core to what we do, and we leverage that expertise and knowledge when funding our own capital needs to support our growth. Ruby Re is another tool that can be used to support our growth and diversifies our sources of capital.
Ruby Re provides just-in-time committed equity capital that aligns well with the unpredictable timing and size of our new business. Additionally, Ruby Re diversifies RGA's revenue streams by providing steady fee income for services provided to Ruby Re, such as deal origination, asset management, and administration fees. As part of the launch, RGA executed an initial retrocession of $2.5 billion of existing liabilities. Subsequently, Ruby Re will receive a quota share of qualifying U.S. asset-intensive business subject to certain conditions. We are happy with the quality and commitment of Ruby Re's external investors, and we are optimistic about the continued contribution to RGA's capital strategy going forward. We take a balanced approach in deploying our capital for three strategic reasons: to support organic growth, invest in Enstar and other transactions, and return capital to our investors via dividends and share repurchases.
The deployment into in-force transactions can be lumpy, but as you can see on the slide, we have been successful over time and complement it with dividends and share repurchases. Part of this lumpiness is expected and intentional, reflecting our deliberate approach to pursuing new business. With that said, from 2020 through the end of the first quarter of this year, we deployed approximately $2.8 billion into in-force transactions and returned $1.4 billion to our shareholders via dividends and share repurchases. Expanding on the in-force transaction deployment, 2023 was a record year. In the first quarter of this year was a record quarter, deploying $933 million and $737 million of capital, respectively. Equally impressive was the diversification across geographies, with the distribution between the U.S., EMEA, and Asia-Pacific. This is a testament to our global business and deep relationships with our key clients around the world.
We ended the first quarter with excess capital of approximately $600 million. Last month, we issued $650 million of senior debt. This will add to our capital in the second quarter and help fund our growth opportunities. At Investor Day last year, we introduced this metric to help demonstrate the long-term value of RGA's business. We have since expanded the concept to include other products not subject to LDTI reporting. This primarily includes investment-type contracts and our capital solutions business. The value now includes all material areas of our business. We have also incorporated other product-level margins into the disclosure, including investment margins and fee income. As a reminder, the previously disclosed amount included only business subject to LDTI and the expected unrealized underwriting margin.
We feel this Value of In-Force helps further demonstrate the long-term value of our business and expected future profits that will be recognized into earnings over time. Based on current estimates, about $33 billion of pre-tax value exists for the business that is already on our books. On a comparable basis, the amount increased almost $4 billion from the end of 2022, primarily due to the profitable new business written during the year. Also noteworthy is the diversified distribution of the value across our key regions. These margins will contribute to significant expected future earnings and book value before consideration of operating expenses, impact of capital, and taxes. Turning to intermediate financial targets, these growth rates are consistent with our strategic plan. As you've heard this morning, we see favorable industry dynamics and market opportunities. RGA is well-positioned to capitalize on these opportunities and produce profitable growth.
When combined with our capital management strategy, we feel confident and expect to deliver on our financial targets of 8%-10% adjusted operating earnings per share growth and an adjusted operating return on equity range of 12%-14%. You should take away several key messages from today. We are proud to have a world-class team and diversified global franchise. RGA's capabilities on both sides of the balance sheet and strategy of innovation continue to produce attractive growth opportunities and returns. We believe there are significant industry tailwinds. Combined with our technical expertise and balanced capital management, we expect these dynamics to contribute to produce many opportunities for us. RGA's long-term track record, proven strategy, and relentless client service uniquely positions us to remain a leading global reinsurer and partner of choice for our clients.
We are confident that our strategy will allow us to deliver attractive financial returns for our shareholders over time. As an additional note, I have announced my retirement at the end of this year, and I will officially pass the CFO torch to Axel André in August. I believe that RGA's future is as bright as ever. I am very proud to have been part of this great organization for nearly 30 years. I will continue to be around until the end of the year in the capacity of special advisor, including the assistance with the transition of the CFO role to Axel André. Thank you for your interest in RGA. We'll now take a short break before opening it up for questions. We have a question and answer session. So please state your name and firm, and for the first round, limit yourself to one question.
You will notice that we've added the various business heads to the table, so they're obviously available for questions as well. Hi, Tony and team. This is Aman Dhamija from PJT Partners. Thanks for having us. This was a great presentation. I think one question for the whole group or for you, Tony. At the very start, there was a lot of discussion on the focus on innovation and an innovation-led organization. So I guess the question is, how do you think about the fine balance or walking the line between innovation being on the cutting edge of everything, both on the liabilities and asset side, versus running like a disciplined, risk management-centric organization? So in other words, kind of moving along with change versus kind of sticking to your core. How do you think about that? Some color will be helpful. Thank you. Thank you.
Now, it's what I shared in the presentation. Look, innovation is a two-sided coin that links together through collaboration. So we only innovate as well as, obviously, our business teams have to understand the client needs, the industry needs, all those things from a commercial perspective. But the risk management is as integral, and it's really the magic, you know, is the combination of the two and the collaboration. So we see absolutely no conflict whatsoever. It really is very much self-reinforcing. Discipline is also. There's so many opportunities. We obviously will continue to be disciplined, as I shared. So I really don't see any conflict. We always say internally, you only can drive the car as fast as you're as strong as your brakes are. So that's very much in our mentality. It's been that way for over 50 years and absolutely will continue going forward. Yeah.
And, Tony, sorry. Tony, maybe just to add on to three thoughts for me. One is, and as you just mentioned, innovation is not new for us as an organization. I think we've been at it a long time. We take our learnings and feed that back into the process and leverage that for further innovation in the future. I think, as I mentioned in my presentation, we feel we've got a very strong governance framework. There's very specific limits we have on new risks. We have an escalation process internally, which gets lots of oversight and review. And then finally, I'd say I'd point to our people and culture as well. So we have experts on the ground in the markets where we operate.
We've got a set of global experts as well, which makes sure that we enforce a consistency of approach and practice across all of the markets where we're doing these innovations. And that's what gives me a lot of comfort. Yeah. Can I just add one more point? I mean, the innovation is critical to get the momentum. Why I mentioned the virtuous innovation cycle, because then it becomes self-sustaining. Then you can see from many, if not all, the transactions, they were all repeat transactions with the same client. Similar products were done elsewhere. So in a way, we're not extending ourselves by doing too much because the principles are still there as to same principles are being applied across different geographies. John Barnidge, Piper Sandler. Early on in your comments, there was a comment about an expectation primary insurers continue to move towards more specialization.
Is there an opportunity to be the insourcer of choice for underwriting and program management in a way cell phone warranty companies have moved that way for mobile carriers, as an example? Okay. Thank you. And I'm going to hand it over to Ron. But that movement of the value chain and specialization, once again, the beauty of us being a global company is U.S. actually is not the fastest. Actually, the U.K. has very much already moved that way, and I would expect the U.K. to follow that lead. But let me hand it over to Ron first to share about the U.S. Yeah. So can you hear me? Yeah. Lean in. Okay. Sorry. So if you think about our clients are identified as insurance companies, and all of our business goes through insurance companies and our banks for the most part.
So we've been able to work with them over a long period of time to determine where there are some successes, where some of them are having challenges. I would say, as of late, one of the things that we've been able to do is to help them bring together the experts in certain areas to effectively serve a market. Now, Tony gave you an example of one that happened in the traditional side, but it's happening across our business now. And if you recall, last year, I talked a little bit about distribution. Distribution has been sort of the unknown thing to penetrate different markets, right? There's been insurtech distribution. There's been core distribution. Companies have varying degrees of success with each. What we've been able to do is bring those organizations together to forge a partnership to ultimately serve the end client.
And that's resonating in a very big way in the market for us in 2023 and in 2024 as well. Yeah. Maybe some. Yeah. Sorry. Excuse me. Yeah. Just a comment on maybe where this can end up. If you look at the UK as a case study, about 80% or 90% of all life insurance journeys go through an automated underwriting engine. And obviously, those sort of large unusual cases will get flipped out to an underwriter. I don't really see that model changing. I mean, to be honest with you, we can't go much further, but we are seeing that in other parts of my region, in the EMEA region, where insurers are starting to get onto that digital journey for efficiency and better customer outcomes. Thanks. Suneet Kamath from Jefferies.
Jonathan, I think in your part of the script, you talked about obesity drugs, and I think you said that over the next 5 years, the benefit could be measurable. So I was just wondering if you could maybe drill into that a little bit, quantify it, and then if is that in your guidance already, or would that be sort of incremental when we think about the intermediate growth targets? Yeah. Thanks for the question. And the short answer is I think it's too early to conclude on the magnitude. I think we're positive and hopeful on the direction that the medication's going. I think some of the stats we showed just pointed out the drag that obesity has had on mortality improvement in the past.
So even if a small portion of that can be addressed through some of these new treatments, I think that will be a positive to future mortality. But we're still examining the data. Our approach is to look at historical current data available, but also think in a forward-looking way with our medical doctors and others thinking about what could happen. But it's not at the stage where I can give you a magnitude specifically for it now. Yeah. I mean, to add the second part, we haven't, as Jonathan said, we haven't put it into our pricing reserving, so it's not in our guidance. Thanks. Ryan Kruger at KBW. Tony, you had mentioned a couple of areas where you're generating higher ROEs, including business from exclusives as well as management actions.
I know you maintain the 12%-14% ROE target for now and talked about the upper end, but because of these tailwinds over the longer term, would you anticipate some level of ROE expansion from these targets? Yeah. So we, as Todd indicated, upper end of the ROE target. We just changed guidance, as you know, I think a quarter ago. What I would say, obviously, our focus is very much on the growth areas, the innovation aspects, and sort of applying it to ourselves on the sort of management actions. I would say right now we're exceeding that target in terms of new business, but that obviously goes up and down over time. But particularly the innovation business is incremental to our normal business, which is fully understandable because we're creating value for our partners.
There could be a first-mover advantage for them, and then we're obviously able to share some of that greater value creation as we should. Hi. Wes Carmichael, at Autonomous Research. Thanks for refreshing slide 44. It shows your biometric risk distribution, and I think it's 65% mortality, 20% morbidity, and 15% longevity. As you think about growth opportunities in the next few years and over the long term, how do you expect that to evolve? Do you expect to remain very long net mortality, or could that change over time? Yeah. And I'm going to pass to Jonathan just after a few comments. I mean, there's growth in every way, right? I mean, you can see in those four areas of growth, it's across the different product lines, across the different geographies. We would very much expect to be long mortality anytime that we can see.
But maybe, Jonathan, some further comments. Yeah. Yeah. And I agree with what you said, Tony and Wes. Just to give you some context, we were about 12% longevity last year, so going from 12 to 15. I think it's off. I think so. We went from 12 to 15 in one year, and I think. Possible. Still not working transcription. All right. They've cut me off. Yeah. Okay. So yeah, so we went up by about 3%, and that was a year of pretty strong longevity production. So that order of magnitude is what I would expect. I think when we talked about numbers last year, over the five-year strategy, we expected to end up in the 20%-25% of longevity for that proportion, which is currently 15. So that would be over the next three or four years.
So that 3%-ish a year is probably about what we would be moving at. And maybe Jonathan, just the diabetes drugs, the impact on longevity versus mortality. Yeah. Yeah. That's also a good point. So one of the sort of facets of our business for mortality and longevity is that the mortality business tends to be younger than the longevity business. So the majority of our net amount at risk for mortality would be under the age of 60. The majority of the present value of our future benefits on longevity would be over the age of 60. And some of these medical advances that I talked about, we expect will have a disproportionate impact or a better impact for the younger ages, so the more insured live ages.
If you just look at the percentage of people who are obese in the U.S., as an example, sort of in the 50s and 60s range, that would be probably 35% or so of the population. Once you get into the 80+ range, that's more like 20%-25% of the population. So we believe or our expectations at this point that the drugs will have a bigger impact for the lives that are more consistent with our insured mortality. Hey. Hey. Joel Hurwitz from Dowling & Partners. Maybe for Jonathan, so you talked about expectations for some excess mortality in the near term. Can you just help quantify that relative to pre-pandemic levels or maybe even what you guys experienced in the past 12 or so months? Yeah. I mean, so certainly we're pleased to see excess population mortality is declining.
Again, the numbers I showed were in the U.S. that we put on the slide, but we are seeing that similar to different degrees, but similar activity in other markets as well. So that's the key driver. So we seem to be moving away from the excess mortality that was happening. We do think it's going to continue. That's built into our reserve expectations. So again, if that emerges as we expect, that's fully reserved for and incorporated into our guidance. Term-wise, probably the next 4-5 years is when we've built in an expectation for higher mortality at this point in our evaluation assumptions. And so far, our results have been better than expected. So as we always do, annually, we look at our assumptions and we'll reset them if we feel like information has changed, but that's our view at this point. Thanks. Tom Gallagher, Evercore.
Jonathan, another one for you. I didn't think you'd expect to be this popular, but here we go. It's good. I mean, I was this popular during COVID, so it's got to get back up. When you talk about the long-term mortality benefits from GLP-1, etc., and you gave a few other examples, should we think about that as being a long-term net tailwind? And the reason I ask, if I think about the 2010 to 2020 period, it was limited mortality improvement. Let's call it a decade of underperforming long-term mortality expectations. So if you take that and combine it with where you see the next 20 years, do you think you'll come out ahead relative to initial actuarial models, or is it unclear? Yeah. I probably, and being a risk person, I'll probably say it's still not entirely clear.
I think we're optimistic about some of these advances that we're seeing, as I described. We're hopeful they're going to have a material impact in a beneficial way. And again, if you look back at the causes of the mortality flattening, I think part of that was obesity. Part of that was cardiovascular. And I mentioned some of the new cholesterol treatments potentially could benefit that and hopefully mean the curve reestablishes itself as a steady decline. I think mortality improvement can be lumpy over time as well, right? So that's something to keep in mind. It's not going to be a steady 1% every year. It's going to be sometimes it'll be more, sometimes it'll be less. And we're hopeful that some of these advances will create that period of more improvement in the future. As I mentioned, there's always factors that go both directions too, right?
So we've got our eye not just on ones that could potentially be positive, but also ones that could result in less of an improvement or a disimprovement. And that gets all factored into our expectations and assumptions. And again, we've got a lot of people devoted to looking at this. We've got a lot of internal expertise, and that's what gives me confidence that we'll be well-positioned to assess all of these things when they change over time. Yeah. Tom, maybe add. This is one of several that Jonathan raised. So whether it's AI, whether it's technology, whether it's whatever, we're starting to we are cautious as to our views on this, but we're getting more optimistic that it could have an impact on the longer-term mortality. Hi. Jimmy Bhullar from J.P. Morgan.
I'm not sure if I have to ask Jonathan something, but I guess I will anyway. This is just a follow-up to your point on GLP. The non-GLP improvement that we've seen in mortality or life expectancy gradually through most geographies, is that assumed in your pricing and reserving and expectations over time? Yeah. Sorry, I should have mentioned that, Jimmy. Thanks for the question. We do have a best estimate assumption for future mortality improvement that's built into both our mortality business for our pricing and valuation as well as our longevity business. So yeah, we have a certain expectation. Again, that's based on historic observation and expert forward-looking opinion, and that gets factored into our thinking. So what we're talking about here is potentially more improvement relative to that expectation. But yes, we do have a base assumption.
And then on Ruby Re, it seems like you're fairly optimistic about growth through that structure. So if you could just give us an idea on what is it that's going to go into the structure versus on RGA's balance sheet? And how is it different from Langhorne Re? Because there was a decent amount of optimism there as well, and it didn't really go as well as planned. So maybe just give us some idea on that. Sure. Hi, Jimmy. Can you hear me? Yeah. Okay. Good. Yeah. So the targeted business for Ruby Re is U.S. asset-intensive business, and there'll be a quota share of business that we bring into RGA. So the difference between the structure, Langhorne Re was a structure where the business was designed to go directly from the client into Langhorne Re, the third-party, the sidecar vehicle.
With Ruby Re, the business will come into RGA, will originate the business, it'll come into RGA, it'll follow obviously all of our underwriting and pricing standards. And then a quota share will be reinsured into Ruby Re. So that's a little bit of a difference between Ruby Re and the Langhorne vehicle. Hey. Thanks. Elyse Greenspan with Wells Fargo. My question, you guys have been pretty positive on the pipeline for transactions. If we can just kind of get an update on what you see there this year. I know on your call, you guys had pointed to just capital deployed being in excess of last year. And can you just kind of give us a sense of capital deployed as of today, an update relative to what we heard on the earnings call? Sure. Let me take some comments and others, I'm sure. Feel free to add.
Pipeline is something we monitor very carefully. The beauty and why we're so confident about our business, we shared obviously tailwinds, we shared our platform, and so on and so forth. In some sense, we feel we're in control of our own destiny. We can create our own pipeline through the innovation and through the momentum we have. What I would share, the pipeline is very full. In Q1, I wouldn't expect that to be a normal quarter because a lot of things just came together at the same time in terms of timing. The pipelines are very strong all around the world. We expect it to continue. Feel free. Yeah. Maybe I'll kick off with longevity. As was mentioned in the presentation, the U.K. and Netherlands are very strong longevity markets. They've been that way for the last five or six years.
We expect it to continue. In fact, estimates are over $100 billion of PRT this year in the UK, of which 50% should find its way into the reinsurance market. So pipelines are very strong. Last year, we had over 30% of that market. So I'm very optimistic about that particular line of business. Sorry, I might just add from an agent perspective. As Tony alluded to, we're very strong around the product development on the agent side, and that does allow us to work closely with our clients in a sort of forward-looking way. And therefore, as Tony said, we are able to create our pipeline to some extent. And I'd add on the asset-intensive side, historically, the first quarter has always been very strong for Asia because a lot of our transactions had been based in Japan.
But what we are seeing now is that asset-intensive opportunities are really proliferating beyond Japan into other markets within Asia, and therefore, we remain very bullish on the pipeline for asset-intensive beyond Japan as well. Just maybe quick because everything's been said, but I would say the pipeline strength is coming out of 2023. So we had a very strong year in 2023, but the fourth quarter in 2023 was also incredibly strong. And so they continue to be robust, but they've been building over time. So it's not just a first-quarter thing for us. It's continued from 2022 into 2023 and now into the first quarter of 2024 and therefore. And as far as capital deployment, in the first quarter, in the in-force transactions, we deployed $737 million of capital. That compares to a full year last year of $933 million.
So we're off to a pretty strong start, but it was a very strong record quarter for deployment. We'll see how the pipeline continues throughout the rest of the year. But the guys to my left are really doing a great job bringing in some very nice transactions for us to deploy capital into. Yeah. I think that's what I would close out in saying is that through our recent reorganization, the way that we're bringing our transaction teams and our business teams around the region even closer together is very exciting and is going to continue to deliver positive results. Wes Carmichael with Autonomous Research again. Maybe following up on that discussion, but in the U.S. pension risk transfer market, one of the large players there made some comments recently that deals are being priced to uneconomic levels to single-digit returns.
Are you seeing that in the marketplace, and how do we think about RGA's pricing hurdle there? Sure. Maybe Dustin? Yeah. Maybe first highlight, again, how we participate in the U.S. PRT market, how we serve the market is that we sit side by side with two of our long-standing insurance partners, and we participate in the upsize market driven by the fiduciaries primarily. We've had great success in our entry over the last year that we're very happy about. We believe that RGA is an excellent balance sheet and counterparty for this market, well-rated, well-diversified. We believe through our biometric risk understandings, our investment capabilities that Leslie highlighted in her presentation, that we will realize margin in this business through time. The pipeline remains very healthy. It's just as good as we saw last year at this time, so. I'd maybe add just brief.
So in answering the question of your margins, so like all of our business, we're very specific about our margins and the governance and all of that of the process. And so we're meeting our margin expectations in that business. And obviously, as you heard from Dustin, we're finding plenty of opportunity by the approach we've taken, and we're going to continue to enhance that and evolve our strategy over time. Yeah. I'd just add, I mean, our jobs is to be different. So we are the longest, biggest mortality block in the world. So that doesn't hurt when we're pricing longevity risk and the capital we have to put behind transactions. Thanks. Jeffrey Nathan at Rockefeller Capital Management. You're clearly optimistic on Asia as one of the four pillars of growth. You noted you're reallocating internal resources there.
Interesting charts on the growth in a largely non-growth life insurance market in Japan, for example. Just three questions. One is, how do you break down Asia as you all think about it? How much is Japan? Second, what is the new capital framework in Japan? You referenced, you said you think this is driving growth in traditional financial solutions, and other markets in Asia will follow it in a similar fashion. Can you explain that capital framework and how this drives long-term growth for RGA? And then third, for Japan, what's the 80/20 rule on what you're selling for that new growth, and how do the returns on that compare with U.S.? Thank you. Sure. Maybe I'll ask Arthur, if you can take the first question, which is breaking it down sort of to some extent by country.
I'll ask Dustin maybe on the new capital framework and the impacts around Asia, and then the 80/20 rule of returns we're typing in Japan. All right. Thanks. So Asia, I mean, obviously, we remain very excited about the growth in Asia. It is a very diverse market, one made up, from our perspective, of 15 different markets that we cover about 50% of the global population. But it is also very diverse. And as you can see, just based on the fact that we have very mature markets, for example, in the northern parts of Asia, as well as more emerging markets in the southern parts, that really gives us that ability to, as Tony alluded to, that virtuous cycle. So it does give us that ability to learn from how we were there 30 years ago and develop that into new opportunities going forward in other markets.
Take China, for example. It's a fantastic market. It's the second largest in the world. It's one where we're still modest in many ways, but nonetheless, in terms of scale, because we entered a bit later. But it is one where there are a lot of parallels between China and Korea some years ago and Japan even before that. So we are able to deploy our expertise in that market through product development, through working with clients, both multinational and locals, in terms of trying to develop that market further. Likewise, the product development engine that we've built up in markets like Hong Kong, like Korea are extremely strong, and we are leveraging those into other markets at the same time, which allows us to sort of build that momentum in the other markets as well.
And likewise, if you look at the southern parts of Asia emerging, as I said before, more around the growing affluence, more around the fact that the need for protection as well as savings, and really the need to address the different distribution needs and challenges of each of those markets. So it's very fertile ground for us, regardless of which market you look at in that region, and allows us to re-leverage the capabilities we have. And likewise, our talent is just fantastic. So we are very excited about the opportunities from that perspective. Dustin? On the capital side, I guess what I would say is that we have a long history of working with the different regulations around the world and how they've evolved.
I mean, it starts back to our early capital solutions days where we were delivering financial products to companies to help them manage their balance sheets. We're very well connected in all the changing regulations around the world. At times, we're even approached for advice on how regulations should be constructed. And maybe what I'd say more than often is that as regulations change, that brings great opportunity. It's always brought great opportunity for RGA as changing regulations change the way that insurance companies' balance sheets look and perform, has just really presented opportunities for RGA. Yeah. Maybe I'll just add on top. I mean, so ESR is the new capital framework.
It sort of follows a bit in the vein of Solvency II in terms of some of those principles, as are other Asian regulatory bodies, obviously wanting to be recognized as world-class, therefore being in line with what the world-class standards are. Just some further comments. You asked the question, and I shared last year, Hong Kong actually is our biggest market. So a lot of attention's on Japan, but actually, Hong Kong's our biggest market because it's sort of, as I shared, the most economically free. We get to deploy everything that RGA's great into that market. So where there is a difference is obviously in all the markets. We have the incredibly strong liability capabilities. In some markets, the asset side hasn't fully formed depending on the currency. But we're very excited to take that. Where would we execute our Hong Kong strategy next?
It's probably very much focused on Japan, where we can do both the asset and the liability side in a proactive fashion, right, with the product development. So that sort of answers your last question, which is, what's the 80/20? So the 80/20 in Japan would be around the blocks. That's a big part that gets a lot of attention. Actually, we probably create as much value around, once again, these long-term biometric-type transactions with a bit of asset risk. And once again, it's really hard for someone to have doctors, underwriters, actuaries, and on the other side have investment professionals, bankers, and so on, and all work together. That is a really difficult thing. It's taken us 50 years to achieve and that culture, and we're not going to let that go, and we're going to push that forward.
Just a follow-up, Tony, on the Japan reinsurance question. Do you think regulators will allow that market to keep growing from a reinsurance standpoint unabated? And the reason I ask, I think historically the FSA has been pretty conservative, and it does seem like there's a lot of momentum in place for other companies outside from yourself who are going after that market. Do you think it's a green light right now from everything you're hearing and seeing? Yeah. I mean, Arthur, please comment. I'd say you're right. The view would be cautious, but if anything, and I was in Tokyo recently, if anything, it's probably been more optimistic than I expected. So I think they're trying to be progressive, understanding the use of reinsurance for capital. Honestly, one of my first jobs when I moved to St. Louis.
Louis in the late 1990s was helping draft some regulations to talk to the regulator about in Japan. So it's not an overnight success. There's something they're very aware of, something we and others have worked with them on. We are incredibly well-positioned. We've had probably at least 10 years of conversations how they're very comfortable with how we're dealing with the transactions, both on an onshore and an offshore perspective. I don't know if there's anything further. I may just add that, I mean, obviously, we have, as Tony alluded to, we've been in Japan close to 30 years, and we have spent a lot of time both with the regulators but also with clients.
And a lot of what our activity is, not just in Japan, but in other markets around, is really helping educate, helping sort of share the knowledge that we learned from other markets, whether it's more recently longevity, but even before that asset intensive. And you've seen many of the Japanese major insurers also begin to adapt that, not just within Japan, but also make acquisitions outside of Japan and therefore enhance their own knowledge and capabilities. And it's often the case that these large insurers also have sort of influence around how the regulations develop. So I do feel that we are, I mean, I am personally optimistic that Japan will continue to develop in a good way around this and opportunities will continue to be available to us and others.
And just as a follow-up, I think it was mentioned that you're executing a second round of raising funds for Ruby Re. Can you comment on how big you're looking to raise? Would that be international or domestic? Because I think the original fundraising was domestic only. Yeah. So for Ruby Re, I mean, originally we had been targeting the $400 million-$500 million range. The initial close that we talked about that we announced back in December was $300 million. And we're currently pretty far along in the second round of investor raise, which should bring us ±$400 million, and then we can still continue to look. I guess the way I view it too, to me, this is our first sidecar that we've built in this fashion, putting Langhorne maybe aside.
And we want this to be a very successful sidecar so that for the next time we come back to market, we'll be very successful with bringing in investors. But right now, Ruby Re is for a U.S. asset intensive business, plus we can also put business in there facultatively. For the U.S. asset intensive, it automatically goes in under certain circumstances, but we can put transactions in there facultatively. So just to be clear, so $300 million was the first raise. This is going to be an incremental $400 million? No, no, no. Or is that just topping it off? Just topping it off to the $400 million all in. Yeah. Okay. Thanks. How you doing? Maybe just following up on Tom's question, are there opportunities to create an Asia Ruby Re? Right? The Japan growth seems so fantastic, and we're just in the very early innings.
Is that an opportunity, or would you look to, as you've partnered here in the U.S. with Pru on the U.S. asset-intensive, could you partner with a KKR or some other capital providers? Okay. Maybe Tom. Yeah. Sure. So alternative capital, I think, is definitely part of our strategy going forward. And the sidecars, third-party capital, Ruby Re type structures are part of that. So certainly, we would consider sidecars that can support other parts of our business would make a lot of sense as we go forward. Right now, we're focused on Ruby Re making sure it's successful, but certainly, we'll consider alternatives as we go down the path forward and to help fund our future growth. Yeah. Other partners? Yeah. I mean, look, we're always looking for the best form of capital, right?
The most effective form, whether that's individual partners, whether it's a Ruby Re type vehicle, we're open to exploring that. We're having all sorts of conversations to that end amongst others. So why wouldn't we? Yeah. John Barnidge, Piper Sandler. You've talked about lots of innovation on the liability side. Can you maybe talk about the opportunity to further innovate on the investment side? Is there an opportunity to more and more grow a fee stream of that business given the unique position of liabilities creation? Thanks. Hi. Thanks for that question. We're always going to expand the platform, and certainly, what we've built to support RGA's business does have some very attractive assets and returns. So we thought Ruby Re was a great opportunity to showcase that and to manage.
I think it gives us optionality in the future, so we're excited to have that as a potential opportunity set. It's not the immediate focus. All right. Good morning. This is Wilma Burdis at Raymond James. Could you please talk about what you're seeing from your competitors? Is there a strong appetite for them to grow in life and morbidity versus P&C? And maybe go into a little detail on pricing and competition. Thank you. Sure. Let me just start. I mean, definitely on the biometric side, the P&C market is very strong, as you probably know. So I would say our competitors in the biometric space are doing what they're doing. It's probably less dynamic than on the asset intensive side. A lot of times, in many of our big markets, it really is an opportunity for us to compete by not competing.
I mean, that really is very much the focus. That's why we shared a lot around innovation today, the case studies, the exclusives, and so on and so forth, because that is always going to be our best way to compete. We're so different because we can do the biometric, and if the opportunity means that we can add more value by doing the asset, then bang. Those biometric competitors have historically proven that is not something they can fully do and definitely cannot do around the world, right, like RGA. I want to just add a couple of more points. I've shared the innovation-oriented transactions create more value for us, create more value for our clients, and rightly so, both partners are rewarded through those higher returns. We also look at what percentage of our total new business is coming from that type of innovative source of business.
Last year, I think I shared definitely higher than expectation, probably more in line with what I would have aspired for to come 2026 as we built it up over time. This year is following a similar track where the percentage of the new business coming from the innovation-type transactions is once again, actually, I think even higher than last year, even though it's just one quarter. Tony, do you mind if I just add on to that? So obviously, in Europe, we see a lot of the competitor set that you would imagine, both in terms of historic legacy competitors and also new competitors who are maybe more focused on the asset side of the business. I think you really need to what we get fed back from clients and from regulators is execution certainty is absolutely key.
And also, especially under Solvency II, the emphasis that's placed on counterparty is absolutely significant. So at the risk of sounding a touch arrogant, I think we're probably the only major player in those sorts of markets that have got genuine competency and depth of capability on both the liability and the asset side, which is a real differentiator for us. Yeah. And maybe just to add, I don't want people thinking, which I'm sure you don't, the biometric risk is not a static thing. I mean, what we're doing in product development is actually creating new forms of risk. Why? Because we've got the doctors, we've got the actuaries, we've got the underwriter, we've got the data, we've got the local presence. So they're usually not brand new, or it could be 5%-10% of a new product is a new feature.
But boy, once you do that, really, you have no competition for that transaction. Ryan Kruger, KBW. I had a question on in-force management. Can you just give us some perspective on how far along you are? I think you've had a slightly different approach than some of your competitors who are just trying to get a sense of how much more there is to do there. Yeah. Let me kick it off, and then Ron, I'm going to pass to you. We're proud of how we've done it, and I won't repeat what I said in the slides. So first point I want to make, it's a global effort. So a lot of attention in the U.S., which Ron can expand further on, but it's been a global approach, and we did it because it's just who we are. It's the right way to do it. It's partnership.
It's holistic. I think we're delighted that we actually are getting business opportunities as a result of that because clients have recognized how we've treated them differently to perhaps other insurers. And when other opportunities like that come about, then we are probably one of the first calls. But Ron, perhaps on the U.S. Yeah. So I would say thanks for the question, Ryan. So it's an ongoing process that is just part of what we do. And so you've seen a number of transactions over the past few years. You'll continue to see transactions as we work with our clients, and they really come in a number of forms. They're not just rate increases, but they are all in an effort to solve a gap from our expectations. And as Tony mentioned, we work very closely with our clients holistically, so it's hard to predict.
I'll steal Jonathan's term and say lumpy, but it's an ongoing effort that will continue into the future. There's no time frame that we're not constantly monitoring them and/or in discussions with clients and/or expect that there'll be impacts to our overall bottom line. Yeah. I may just add from an Asian perspective, it is a constant. I mean, we do invoice management all the time at the local and regional level, and it allows us to have that dialogue with clients, as Jonathan mentioned before on the feedback loop. Also, it helps us in product development. We learn from that experience. We share that with our clients, and we use that to further develop new products for them in the future. So it's a great tool for us as well. Thank you. I just wanted to follow up actually on that obesity piece.
You talked about that obesity impacted mortality, I guess 0.5%, and reduced the age about 0.9 years. If some of the innovation in drugs helps just reverse that, can we quantify what that means to embedded margin? Is there an easy way to think about that? Again, I can't give a here's a hard number, right, to think about. I mean, maybe a way to consider it is if you think about our claims as an example. So on an annual basis, the dollars of claims that we pay for mortality, I'm going to ballpark this, so don't take it down, say $10 billion, right, just to pick a rough number.
So if you could think about if there's a 0.5% improvement permanently in claims payments times the duration of our business, that's a rough sort of sense of the value that that would create from an organizational perspective. Now, that's mortality, so you'd have to think we would have an opposite effect on longevity. But as I mentioned, we are definitely, by all our measures, long on the mortality risk, so it would be a net positive for us for sure. Thanks. Wes Carmichael, Autonomous Research. Just hoping you could touch on, outside of the sidecars, alternative capital capacity. Do you have future surplus and embedded transaction value there? And additionally, Todd, I think you talked about $650 million of debt that you raised senior notes. I think there's $400 million of callable securities this year. Should we think about netting that when you think about excess capital?
No. Our next legal maturity, I think, is 2026. So as of right now, we're not planning to call any securities at all. But alternative capital, yeah, we've been successful in the past. We've done a couple of surplus notes. We've done some embedded value securitizations. And the embedded value securitizations, we really like, although they're a little complicated to pull together and that type of thing, but they actually help us demonstrate that $33 billion of in-force value, right, because we're getting it modeled, getting it third-party verified, and it actually helps demonstrate that that value really does exist. So we'll continue to look at those alternatives as we go forward, along with partnering with potential retrocessionaires and that type of thing, and then continue to evaluate if and when it makes sense to do additional sidecars. Probably got time for one more question. Thanks. Tom Gallagher, Evercore.
Question on long-term care. You had Manulife announcing a risk transfer deal. And Tony, I know you guys have been writing a certain form of long-term care reinsurance cover, more recent generation, lower-risk product. Is that something you—my questions are: A, is that something you'd consider doing if there was another sizable in-force transaction that was bundled with something else? And B, do you think this will broaden, or do you view Manulife as more of a one-off? Yeah. Thanks, Tom. As I've shared today, we've got many opportunities, four growth engines, orientation towards innovation, and so on and so forth. So first and foremost, a lot of opportunities out there. Second point would be we view ourselves as one of the leading life and biometric experts in the world. So we view ourselves as being able to price and come up with a risk-return trade-off for most liabilities in the world.
Long-term cover is obviously one example of it. It's not a priority to expand our tolerance beyond what we've already done in terms of transactions. The transactions we have done over a number of years in that area are very modest. Also have performed very well the newer types of products and origination. So hopefully, that gives you a flavor for where we're headed or thinking along long-term care. Okay. Do you want me to wrap, Jeff, or? Look, thank you once again. As I said in my opening, we really look forward to speaking to you all. Our story is unique. I think of it as like talking about your kids. You just love talking about it. And as you can see, and hopefully, you can feel, we love the company. We're excited about our future. And once again, thank you for your interest in the company.