Company: APO
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001858681-25-000139
Chunk: 182

Company: Apollo Global Management, Inc.
Filing Date: 2025-11-10
Form: 10-Q
Item: Item 1
Chunk 182
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 of market risk benefits requires the use of inputs related to fees and assessments and assumptions in determining the projected benefits in excess of the projected account balance. Judgment is required for both economic and actuarial assumptions, which can be either observable or unobservable, that impact future policyholder account growth.Economic assumptions include interest rates and implied volatilities throughout the duration of the liability. For indexed annuities, assumptions also include projected equity returns which impact cash flows attributable to indexed strategies, implied 

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Table of ContentsAPOLLO GLOBAL MANAGEMENT, INC.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

equity volatilities, expected index credits on the next policy anniversary date and future equity option costs. Assumptions related to the level of option budgets used for determining the future equity option costs and the impact on future policyholder account value growth are considered unobservable inputs.Policyholder behavior assumptions are unobservable inputs and are established using accepted actuarial valuation methods to estimate withdrawals (surrender rate) and income rider utilization. Assumptions are generally based on industry data and pricing assumptions which are updated for actual experience, if necessary. Actual experience may be limited for recently issued products.All inputs are used to project excess benefits and fees over a range of risk-neutral, stochastic interest rate scenarios. For indexed annuities, stochastic equity return scenarios are also included within the range. A risk margin is incorporated within the discount rate to reflect uncertainty in the projected cash flows such as variations in policyholder behavior, as well as a credit spread to reflect nonperformance risk, which is considered an unobservable input. Athene uses its public credit rating relative to the U.S. Treasury curve as of the valuation date to reflect its nonperformance risk in the fair value estimate of market risk benefits.The following summarizes the unobservable inputs for market risk benefits:September 30, 2025(In millions, except percentages)Fair ValueValuation TechniqueUnobservable InputsMinimumMaximumWeighted AverageImpact of an Increase in the Input on Fair ValueMarket risk benefits, net$4,612 Discounted cash flowNonperformance risk0.4 %1.0 %0.9 %1DecreaseOption budget0.5 %6.0 %2.6 %2DecreaseSurrender rate3.7 %7.9 %5.2 %2DecreaseUtilization rate28.6 %95.0 %86.1 %3Increase