# EDGAR Filing Document

**Accession Number:** 0000934344
**File Stem:** 0001104659-26-050101
**Filing Date:** 2026-4
**Character Count:** 354012
**Document Hash:** 93e3eee6e30e52b722ff0c27b842b73d
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001104659-26-050101.hdr.sgml**: 20260428

**ACCESSION NUMBER**: 0001104659-26-050101

**CONFORMED SUBMISSION TYPE**: N-VPFS

**PUBLIC DOCUMENT COUNT**: 3

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260428

**DATE AS OF CHANGE**: 20260428

**EFFECTIVENESS DATE**: 20260428

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** PHL VARIABLE ACCUMULATION ACCOUNT
- **CENTRAL INDEX KEY:** 0000934344

**ORGANIZATION NAME:**
- **EIN:** 061045829
- **STATE OF INCORPORATION:** CT
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** N-VPFS
- **SEC ACT:** 1940 Act
- **SEC FILE NUMBER:** 811-08914
- **FILM NUMBER:** 26905448

**BUSINESS ADDRESS:**
- **STREET 1:** ONE AMERICAN ROW
- **STREET 2:** 10TH FLOOR
- **CITY:** HARTFORD
- **STATE:** CT
- **ZIP:** 06102
- **BUSINESS PHONE:** 8604036461

**MAIL ADDRESS:**
- **STREET 1:** ONE AMERICAN ROW
- **STREET 2:** 10TH FLOOR
- **CITY:** HARTFORD
- **STATE:** CT
- **ZIP:** 06102

## Series and Classes Contracts Data

### PHL VARIABLE ACCUMULATION ACCOUNT (Series ID: S000007644)

| Class ID   | Class Name               | Ticker Symbol   |
|:---|:---|:---|
| C000020861 | RETIREMENT PLANNERS EDGE |  |
| C000020862 | PHOENIX PREMIUM EDGE     |  |
| C000020863 | PHOENIX INCOME CHOICE    |  |
| C000020864 | PHOENIX INVESTORS EDGE   |  |
| C000020866 | PHOENIX DIMENSIONS       |  |
| C000069890 | FREEDOM EDGE             |  |

**PHL Variable**

**Insurance Company, In Rehabilitation**

**(a wholly owned subsidiary of**

**PHL Delaware, LLC)**

**Statutory Financial Statements and** 

**Supplemental Schedules**

**December 31, 2025, 2024 and 2023**

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**PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Table of Contents**<br>

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| | |
|:---|:---|
| | **Page** |
| **Statutory Financial Statements:** | |
| <u>[Independent Auditors' Report](#i3804029e54d44052be32f54c5d785dd7_7)</u> | <u>[1](#i3804029e54d44052be32f54c5d785dd7_7)</u>-3 |
| <u>[Statements of Admitted Assets, Liabilities, Capital and Surplus](#i3804029e54d44052be32f54c5d785dd7_10)</u> | <u>[4](#i3804029e54d44052be32f54c5d785dd7_10)</u> |
| <u>[Statements of Income (Loss) and Changes in Capital and Surplus](#i3804029e54d44052be32f54c5d785dd7_13)</u> | <u>[5](#i3804029e54d44052be32f54c5d785dd7_13)</u> |
| <u>[Statements of Cash Flows](#i3804029e54d44052be32f54c5d785dd7_16)</u> | <u>[6](#i3804029e54d44052be32f54c5d785dd7_16)</u> |
| <u>[Notes to Statutory Financial Statements](#i3804029e54d44052be32f54c5d785dd7_19)</u> | <u>[7](#i3804029e54d44052be32f54c5d785dd7_19)</u>-52 |
| **Supplemental Schedules:** |  |
| &nbsp;&nbsp; <u>[Summary of Investments - Other than Investments in Related Parties](#i3804029e54d44052be32f54c5d785dd7_85)</u> | <u>[53](#i3804029e54d44052be32f54c5d785dd7_85)</u>-54 |
| &nbsp;&nbsp; <u>[Supplementary Insurance Information](#i3804029e54d44052be32f54c5d785dd7_91)</u> | <u>[55](#i3804029e54d44052be32f54c5d785dd7_91)</u> |
| &nbsp;&nbsp; <u>[Supplementary Schedule - Reinsurance](#i3804029e54d44052be32f54c5d785dd7_94)</u> | <u>[56](#i3804029e54d44052be32f54c5d785dd7_94)</u> |

---

i

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**Independent Auditors' Report**

The Rehabilitator and Special Deputy Rehabilitator

PHL Variable Insurance Company, In Rehabilitation:

*Opinions*

We have audited the financial statements of PHL Variable Insurance Company, In Rehabilitation (the Company), which comprise the statements of admitted assets, liabilities, capital and surplus as of December 31, 2025 and 2024, and the related statements of income (loss), and changes in capital and surplus, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes to the financial statements.

*Unmodified Opinion on Statutory Basis of Accounting*

In our opinion, the accompanying financial statements present fairly, in all material respects, the admitted assets, liabilities, capital and surplus of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in accordance with accounting practices prescribed or permitted by the Connecticut Insurance Department described in Note 2.

*Adverse Opinion on U.S. Generally Accepted Accounting Principles*

In our opinion, because of the significance of the matter discussed in the Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles section of our report, the financial statements do not present fairly, in accordance with U.S. generally accepted accounting principles, the financial position of the Company as of December 31, 2025 and 2024, or the results of its operations or its cash flows for each of the years in the three-year period ended December 31, 2025.

*Basis for Opinions*

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

*Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles*

As described in Note 2 to the financial statements, the financial statements are prepared by the Company using accounting practices prescribed or permitted by the Connecticut Insurance Department, which is a basis of accounting other than U.S. generally accepted accounting principles. Accordingly, the financial statements are not intended to be presented in accordance with U.S. generally accepted accounting principles. The effects on the financial statements of the variances between the statutory accounting practices described in Note 2 and U.S. generally accepted accounting principles, although not reasonably determinable, are presumed to be material and pervasive.

------

*Substantial Doubt About the Entity's Ability to Continue as a Going Concern*

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company entered rehabilitation proceedings in the Connecticut Superior Court on May 20, 2024, in response to the Company's hazardous financial condition. As discussed in Note 2, the Company has stated that substantial doubt exists about the Company's ability to continue as a going concern. Management's evaluation of the events and conditions and management's plans regarding this matter are also described in Note 2, including that the ability of the Company to continue as a going concern is dependent on the court-ordered moratorium issued in the rehabilitation proceedings. As described in Note 1, any plan for resolution of the Company's liabilities must include a liquidation order. The timing of a liquidation order is uncertain. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinions are not modified with respect to this matter.

*Responsibilities of Management for the Financial Statements*

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting practices prescribed or permitted by the Connecticut Insurance Department. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for one year after the date that the financial statements are available to be issued.

*Auditors' Responsibilities for the Audit of the Financial Statements*

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS, we:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Exercise professional judgment and maintain professional skepticism throughout the audit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly, no such opinion is expressed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.

*Supplementary Information*

Our audits were conducted for the purpose of forming an opinion on the financial statements as a whole. The supplementary information included in the summary of investments - other than investments in related parties, the supplementary insurance information, and the supplementary schedule - reinsurance, is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by the Securities and Exchange Commission. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audits of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.

/s/ KPMG LLP

Boston, Massachusetts

April 14, 2026

------

---

| |
|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Statements of Admitted Assets, Liabilities, Capital and Surplus** |
| *(in thousands)* |

---

---

| | | |
|:---|:---|:---|
| | **As of December 31,** | **As of December 31,** |
| | **2025** | **2024** |
| **Admitted assets:** |  |  |
| Bonds | $641315 | $653176 |
| Preferred stock | 822 | 1086 |
| Common stock | 639 | 1692 |
| Contract loans | 73883 | 74874 |
| Mortgage loans | 22795 | 23771 |
| Cash, cash equivalents and short-term investments | 475635 | 121121 |
| Derivatives | 366 | 948 |
| Receivables for securities | 3752 | 6512 |
| Other invested assets | 61193 | 111669 |
| **Total cash and invested assets** | **1280400** | **994849** |
| Deferred and uncollected premium | 5059 | 5420 |
| Due and accrued investment income | 3388 | 3211 |
| Receivable from affiliates | 3849 | 13599 |
| Reinsurance amounts receivable | 54672 | 62492 |
| Other assets | 90117 | 132747 |
| Separate account assets | 2172730 | 2436013 |
| **Total admitted assets** | $**3610215** | $**3648331** |
| **Liabilities:** |  |  |
| Reserves for future policy benefits | $2677470 | $2540373 |
| Payable to affiliates | 1617 | 7880 |
| Funds held under coinsurance | 1095397 | 806306 |
| Reinsurance payables | 31308 | 36786 |
| Net transfers due to (from) separate accounts | 26169 | 50815 |
| Other liabilities | 20329 | 28260 |
| Asset valuation reserve ("AVR") | 4547 | 9081 |
| Separate account liabilities | 2172730 | 2436013 |
| **Total liabilities** | **6029567** | **5915514** |
| **Capital and surplus:** |  |  |
| Common stock, $5,000 par value (1,000 shares authorized; 500 shares issued and outstanding) | 2500 | 2500 |
| Paid-in surplus | 283333 | 283333 |
| Surplus notes | 55000 | 55000 |
| Unassigned surplus | (2760185) | (2608016) |
| **Total capital and surplus** | **(2419352)** | **(2267183)** |
| **Total liabilities, capital and surplus** | $**3610215** | $**3648331** |

---

The accompanying notes are an integral part of these financial statements.

------

---

| |
|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Statements of Income (Loss) and Changes in Capital and Surplus** |
| *(in thousands)* |

---

---

| | | | |
|:---|:---|:---|:---|
| | **For the years ended<br>December 31,** | **For the years ended<br>December 31,** | **For the years ended<br>December 31,** |
| | **2025** | **2024** | **2023** |
| **Income:** |  |  |  |
| Net investment income and amortization of IMR | $34325 | $32923 | $45175 |
| Separate account net gain (loss) from operations | 6565 | (100797) | 53249 |
| Commissions and expense allowances on reinsurance ceded | 22925 | 26435 | 31874 |
| Reserve adjustments on reinsurance ceded | (158429) | (147014) | (235287) |
| Fees associated with separate account and other miscellaneous income | 49069 | 55130 | 59095 |
| **Total income** | **(45545)** | **(133323)** | **(45894)** |
| **Current and future benefits:** |  |  |  |
| Net transfers (from) to separate accounts, net of reinsurance | (285126) | (485090) | (352390) |
| Change in reserves for future policy benefits | 136996 | 2093888 | 193669 |
| **Total current and future benefits** | **(148130)** | **1608798** | **(158721)** |
| **Operating and other expenses:** |  |  |  |
| Commissions | 3098 | 3924 | 5115 |
| Other operating expenses | 40556 | 19188 | 21772 |
| Reserve adjustments on MODCO assumed and MODCO consideration | (94366) | (48674) | (92197) |
| Other amounts ceded | 274978 | 307040 | 339752 |
| Premium, payroll and miscellaneous taxes | 4068 | 5536 | 7090 |
| **Total operating and other expenses** | **228334** | **287014** | **281532** |
| Net gain (loss) from operations before federal income taxes | (125749) | (2029135) | (168705) |
| Federal and foreign income tax expense (benefit) |  | (14517) | (6435) |
| Net income (loss) from operations before realized capital gains (losses) | (125749) | (2014618) | (162270) |
| Realized capital gains (losses), net of income taxes and IMR | (9419) | (66807) | (10797) |
| **Net income (loss)** | **(135168)** | **(2081425)** | **(173067)** |
| **Changes in capital and surplus:** |  |  |  |
| Change in unrealized capital gains (losses), net of tax | (3848) | 2326 | (1924) |
| Change in deferred income tax |  |  | (29150) |
| Change in non-admitted assets | (4157) | (9513) | 23508 |
| Change in liability for reinsurance in unauthorized and certified companies |  |  | 2036 |
| Change in asset valuation reserve | 4534 | 3482 | (1368) |
| Other surplus changes, net | (3095) | (14666) |  |
| Correction of prior period errors (see Note 2) | (10435) | (32600) |  |
| Net increase (decrease) in capital and surplus | (152169) | (2132396) | (179965) |
| **Capital and surplus, beginning of year** | **(2267183)** | **(134787)** | **45178** |
| **Capital and surplus, end of year** | $**(2419352)** | $**(2267183)** | $**(134787)** |

---

The accompanying notes are an integral part of these financial statements.

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| |
|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Statements of Cash Flows** |
| *(in thousands)* |

---

---

| | | | |
|:---|:---|:---|:---|
| | **For the years ended<br>December 31,** | **For the years ended<br>December 31,** | **For the years ended<br>December 31,** |
| | **2025** | **2024** | **2023** |
| **Cash provided by (used for) operations:** |  |  |  |
| Premiums and annuity considerations | $194458 | $222596 | $278073 |
| Net investment income | 35915 | 42421 | 49357 |
| Other income | 72609 | (28187) | 132800 |
| Claims and benefits | (283885) | (677209) | (1045343) |
| Commissions and other expenses | 44913 | 23646 | 58450 |
| Net transfers from (to) separate accounts | 260481 | 621157 | 379126 |
| Federal income taxes recovered (paid) |  | 1453 | 6620 |
| **Net cash provided by (used for) operations** | **324491** | **205877** | **(140917)** |
| **Cash provided by (used for) investments:** |  |  |  |
| Proceeds from sales, maturities and scheduled repayments of bonds | 129292 | 128780 | 204297 |
| Proceeds from sales, maturities and scheduled repayments of stocks | 425 | 2411 | 2169 |
| Proceeds from sales, maturities and scheduled repayments of mortgage loans | 979 | 20954 | 1509 |
| Proceeds from sales, maturities and scheduled repayments of other investments | 62523 | 12060 | 43078 |
| Cost of bonds acquired | (127771) | (125292) | (1637) |
| Cost of other investments acquired | (11782) | (28322) | (82608) |
| Net decrease (increase) in contract loans | 991 | (2444) | (2081) |
| **Net cash provided by (used for) investments** | **54657** | **8147** | **164727** |
| **Cash provided by (used for) financing and miscellaneous sources:** |  |  |  |
| Net deposits (withdrawals) of deposit-type contracts | (38720) | (13310) | (7518) |
| Other cash provided (applied) | 14086 | (118232) | (54305) |
| **Net cash provided by (used for) financing and miscellaneous uses** | **(24634)** | **(131542)** | **(61823)** |
| Net increase (decrease) in cash and short-term investments | 354514 | 82482 | (38013) |
| **Cash and short-term investments, beginning of year** | **121121** | **38639** | **76652** |
| **Cash and short-term investments, end of year** | $**475635** | $**121121** | $**38639** |

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The accompanying notes are an integral part of these financial statements.

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| |
|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statement** |
| *(in thousands except where noted in millions or billions)* |

---

**1. Description of Business**

PHL Variable Insurance Company, In Rehabilitation ("PHL" or the "Company") is a wholly-owned subsidiary of PHL Delaware, LLC ("PHL Delaware" or the "Parent"). PHL is a provider of life insurance and annuity products. The Company's life insurance products include universal life, variable universal life and other insurance products. The Company has both single-life and multiple-life products. Under multiple-life policies, several lives may be insured with the policy proceeds paid after the death of the first or last insured. The Company's annuity products include deferred annuities and fixed indexed annuities. Annuity products accumulate for a number of years before periodic payments begin and enable the contract owner to save for retirement and provide options that protect against outliving assets during retirement. The Company's fixed indexed annuity products include single premium deferred equity indexed annuities and also single premium fixed indexed annuities. In November 2019, PHL stopped marketing and selling new business.

Effective October 1, 2019, PHL entered into a combined coinsurance funds withheld and modified coinsurance agreement (the "Concord Treaty") that reinsures the total retained risk in PHL to a wholly-owned captive subsidiary, Concord Re, Inc., In Rehabilitation ("Concord") that is licensed in Connecticut. Concord has a 30-year excess-of-loss agreement (the "XOL Agreement") with Palisado Re, Inc., In Rehabilitation ("Palisado"), a subsidiary of PHL with a $450 million limit of coverage.

PHL, Concord, and Palisado (collectively, "PHL Companies") entered rehabilitation proceedings in the Connecticut Superior Court (the "Court") on May 20, 2024, as a result of the PHL Companies' hazardous financial condition. Rehabilitation is a court proceeding that the insurance commissioner of a company's state of domicile may initiate to take control of a company if it is in a hazardous financial condition.

The Court appointed the Connecticut Insurance Commissioner as the PHL Companies' Rehabilitator. The Rehabilitator assumed control of the PHL Companies' assets and has continued to administer them under the Court's supervision. The Rehabilitator is also empowered to take the necessary or appropriate actions approved by the Court to rehabilitate the PHL Companies. On December 31, 2025, the Rehabilitator filed a report with the Court stating that he has determined that a rehabilitation plan, as originally contemplated, is not feasible and that a liquidation order will be required. The Rehabilitator expects that a liquidation order will be entered by late 2026 or early 2027, but it may be earlier or later. Until that time, the Rehabilitator will continue to administer PHL's business under the existing Rehabilitation Order.

**2. Summary of Significant Accounting Policies**

The significant accounting policies, which are used by PHL in the preparation of its statutory financial statements, are described below.

**Basis of presentation**

These financial statements were prepared on the basis of accounting practices ("STAT") prescribed or permitted by the Connecticut Insurance Department (the "Department" or "CID"). These practices are predominately promulgated by the National Association of Insurance Commissioners (the "NAIC").

These practices differ from accounting principles generally accepted in the United States of America ("U.S. GAAP"). PHL does not prepare financial statements on a U.S. GAAP basis and, as a result, differences from U.S. GAAP are not readily determinable. The major differences from U.S. GAAP practices are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The costs related to acquiring business, principally commissions and certain policy issue expenses are charged to income in the year incurred for STAT and are capitalized as deferred acquisition costs ("DAC") and then amortized for U.S. GAAP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Statutory concepts such as non-admitted assets, asset valuation reserve and interest maintenance reserve are recognized only for STAT.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Bonds are primarily carried at amortized cost for STAT and at fair value for U.S. GAAP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• For certain deposit-type contracts in the accumulation stage and for annuity products, deposits are reported as annuity considerations (a revenue item) for STAT, while U.S. GAAP reports these as deposits via the balance sheet.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Under STAT, for universal life and variable annuity contracts, premiums or deposits are recognized as revenue, and withdrawals are recognized as surrender benefits. Benefits, losses and related expenses are matched with premiums over the related contract periods. For U.S. GAAP, amounts received as payments for universal life, variable universal life and other investment-type contracts are considered deposits and are not included in premiums. Withdrawals taken from these contracts are generally considered returns of policyholder account balances and are not included in surrender benefits for U.S. GAAP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Statutory reserves are based on different assumptions than they are under U.S. GAAP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Assets and liabilities are reported net of reinsurance balances for STAT and gross for U.S. GAAP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The statutory provision for federal income taxes represents estimated amounts currently payable based on taxable income or loss reported in the current accounting period as well as changes in estimates related to prior year taxes. Deferred income taxes are provided in accordance with Statement of Statutory Accounting Principles ("SSAP") No. 101, *Income Taxes, a Replacement of SSAP No. 10*, and changes in deferred income taxes are recorded through surplus. SSAP No. 101 adopts the U.S. GAAP valuation allowance standard and also limits the recognition of deferred tax assets ("DTAs") based on certain admissibility criteria. The U.S. GAAP provision would include a provision for taxes currently payable as well as deferred taxes, both of which would be recorded in the income statement. Under SSAP No. 101, in conjunction with SSAP No. 5 as modified to replace the "probable" standard with a "more likely than not" standard, companies must establish a liability related to uncertain tax positions where management determines that it is more likely than not a claimed tax benefit would not be sustained if audited. SSAP No. 101 specifically rejects the corresponding U.S. GAAP guidance. For U.S. GAAP, income taxes are accounted for in accordance with Accounting Standards Codification ("ASC") 740, *Accounting for Income Taxes*. Income tax expense or benefit is recognized based upon amounts reported in the financial statements and the provisions of currently enacted tax laws. Deferred tax assets and/or liabilities are determined by multiplying the differences between the financial reporting and tax reporting bases for assets and liabilities by the enacted tax rates expected to be in effect when such differences are recovered or settled. Valuation allowances on deferred tax assets are recorded to the extent that management concludes that it is more likely than not that an asset will not be realized. For both STAT and U.S. GAAP, the Company assesses all significant tax positions to determine if a liability for an uncertain tax position is necessary and, if so, the impact on the current or deferred income tax balances.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• For STAT, wholly owned subsidiaries are not consolidated, but subsidiary earnings and losses and other changes in capital and surplus are accounted for as unrealized gains and losses. Dividends received from subsidiaries are treated as investment income. For GAAP, results of wholly owned subsidiaries are consolidated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Surplus notes issued by the Company are recognized as surplus for STAT and debt for U.S. GAAP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Under STAT, we consider forms of security that are acceptable to the Commissioner under Connecticut General Statutes Section 38a-86(a)(4) to recognize the credit for reinsurance. For GAAP, a reinsurance recoverable would be reported as an asset and assessed for impairment related to the credit risk of the reinsurer.

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In applying these estimates and assumptions, management makes subjective and complex judgments that frequently require assumptions about matters that are uncertain and inherently subject to change, such as possibility for elevated mortality rates and market volatility. We regularly review our projections and associated assumptions as part of our ongoing assessment of our business performance and risks. Small changes in assumptions or small deviations of actual experience from assumptions can have, and in the past have had, material impacts on our results of operations and financial condition, and as such, the range of scenarios around these projections is significant. Actual results may differ from those estimates. Significant estimates and assumptions used in determining insurance and contractholder liabilities, income taxes, contingencies and valuation allowances for invested assets are discussed throughout the Notes to Statutory Financial Statements.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

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**Recent accounting pronouncements**

In 2023, the NAIC adopted revisions to SSAP No. 26, *Bonds*, and SSAP No. 43, *Asset-Backed Securities*, to incorporate the principles-based bond definition for use in determining whether an investment (i.e., security) qualifies for reporting as a bond into statutory accounting guidance and to address the accounting treatment for securities that do qualify as bonds. SSAP No. 2, *Cash, Cash Equivalents, Drafts and Short-Term Investments*, was also revised to exclude asset-backed securities from being reported as a cash equivalent or short-term investment. In 2024, the NAIC adopted revisions to SSAP No. 21, *Other Admitted Assets*, to provide guidance for debt securities that do not qualify as bonds under the principles-based definition. The 2024 adopted revisions prescribe accounting guidance (measurement method) for all residual interests regardless of legal form. In 2024, the NAIC also adopted Statutory Issue Paper No. 169, *Principles-Based Bond Definition*, to provide additional guidance. These revisions all had an effective date of January 1, 2025, and were implemented by the Company resulting in no material impact. Prior year disclosures were not adjusted for the new presentation requirements.

In 2025, the NAIC adopted revisions to SSAP No. 1, *Accounting Policies, Risks & Uncertainties and Other Disclosures*, to update restricted asset disclosures, including assets held under modified coinsurance or funds withheld reinsurance agreements. The revisions had an effective date of December 31, 2025 and the revised disclosures have been included by the Company.

In 2025, the NAIC adopted revisions to SSAP No. 56, *Separate Accounts*, to clarify the measurement of separate account assets and prescribe the treatment for transfers between the general account and separate account with IMR and AVR recognition, effective January 1, 2026. In 2025, the NAIC adopted revisions to multiple SSAPs to ensure consistent guidance and disclosures over private placement securities, effective December 31, 2026. In 2025, the NAIC adopted revisions to SSAP No. 26, SSAP No. 43 and SSAP No. 21 to ensure consistent guidance and disclosures over debt security disclosures, effective December 31, 2026. The impacts of such revisions are being assessed by the Company.

**Going concern**

As described in Note 1, in response to the PHL Companies' hazardous financial condition, the PHL Companies entered rehabilitation proceedings in the Connecticut Superior Court on May 20, 2024. On June 25, 2024, the Court approved on a final basis a moratorium order that limits payments under some policies and annuities. The moratorium allows the PHL Companies to mitigate the high outflow of claim payments and is anticipated to be in place in some form until a liquidation order is entered by the Court. Although the payments have been limited under the moratorium, the Companies have continued to record liabilities for the full amount of policyholder benefits. The claims payable balance for amounts in excess of the moratorium limits, where claims have already been paid up to the moratorium limit, is $589.9 million and $230 million as of December 31, 2025 and 2024, respectively, for the PHL Companies. Additionally, the PHL Companies have recorded a liability for interest on unpaid death claims, as would be required statutorily, of $39.7 million and $8.5 million as of December 31, 2025 and 2024, respectively. Claims payable for amounts in excess of the moratorium limits and the related liability for interest on unpaid death claims are reported within other liabilities, net of reinsurance. The Rehabilitator has evaluated the Company's ability to continue as a going concern and concluded that substantial doubt exists about the Company's ability to continue as a going concern.

The Company has incurred a net loss of $135.2 million and $2.1 billion for the years ended December 31, 2025 and 2024, respectively, with capital and surplus declining to $(2.4) billion and $(2.2) billion at December 31, 2025 and 2024, respectively. As of December 31, 2023, PHL's RBC dropped to a mandatory control level and has remained there through 2025. In recent years, PHL experienced adverse mortality in its universal life business, which contributed to a significant increase in claims volatility and PHL's deteriorating financial condition.

As described in Note 1, the Concord Treaty provides PHL with reserve relief for certain life and annuity products. Beginning in 2023, the value of the underlying collateral supporting this treaty declined significantly, which resulted in the Company recognizing a reserve credit impairment charge of $138 million, $776 million and $176 million for the years ended December 31, 2025, 2024 and 2023, respectively. PHL's loss of full reserve credit results in PHL retaining additional risk for life and annuity products which places increased demand on the Company's available capital and liquidity.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

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Although the Rehabilitator has estimated the Company has sufficient liquidity to meet its obligations for the next twelve months, such ability is subject to the moratorium order entered in the rehabilitation proceeding. Based on the significance of these conditions and events, the Rehabilitator concluded that substantial doubt exists about the Company's ability to continue as a going concern. As described in Note 1, any plan for a resolution of PHL's liabilities must include a liquidation order. The timing of a liquidation order is uncertain.

**Risks and uncertainties**

The Company is exposed to various risks and may face difficult economic conditions that could impact the Company's results of operations, financial condition and liquidity.

<u>Concord Treaty</u>

At December 31, 2025, Concord's capital and surplus was negative. It is uncertain whether Concord will have sufficient invested and other assets to support the Concord Treaty with PHL. PHL may need to further impair the reserve credit if Concord does not hold assets at least equal to the reserves that PHL is ceding. Included in the risk transferred to Concord are PHL's older age universal life policies, which have a number of large face amount policies that are not reinsured to third parties and have generated significant losses in recent years as a result of adverse mortality.

<u>Liquidity Challenges</u>

As of year-end 2019, PHL ceased underwriting activities. To mitigate the liquidity challenges posed by large claims and the lack of new revenue, as described in Note 2, on June 25, 2024, the Court approved on a final basis a moratorium order that limits payments under some policies.

<u>XOL Agreement</u>

Concord is a party to the XOL Agreement with Palisado, which provides coverage in the event assets are not sufficient to pay claims (see Note 1). However, for the year ended December 31, 2025, Palisado's surplus was negative and, the full $450 million of the XOL was no longer available to Concord to support reserve credit to PHL.

<u>Market Factors</u>

Market factors, including interest rates, credit spreads, equity prices, derivative prices and availability, volatility, disruptions and strength of the capital markets, deflation and inflation, and government actions in response thereto could adversely impact results. The Rehabilitator has taken measures to mitigate these risks by repositioning the investment portfolio through the sale of less-liquid, subordinated assets and reinvestment in shorter-duration, high quality bonds.

Although rising interest rates are generally positive to the Company's economics, a sharp rise in interest rates, in the absence of other countervailing changes, would result in deterioration in the net unrealized position of the Company's investment portfolio and, if long-term interest rates rise dramatically within a six to twelve-month time period, certain products may be exposed to disintermediation risk. Disintermediation risk refers to the risk that policyholders may surrender their contracts in a rising interest rate environment, requiring the liquidation of assets in an unrealized loss position. The Rehabilitator believes this risk is mitigated by the moratorium approved by the Court on June 25, 2024, which limits surrenders on all non-variable life and annuity products except on a limited basis pursuant to a modification to the moratorium approved by the Court on December 24, 2025. It is also mitigated to some extent by surrender charge and market value adjustment protection provided by certain products, in particular the Company's fixed indexed annuity and fixed annuity business. Lower interest rates are generally negative to the Company's economics due to lower investment income and increases in asset adequacy reserves.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

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**Correction of errors from prior periods**

The Company's December 31, 2024 financial statements reflect the correction of prior period errors related to reserve valuation calculations for certain policies. In accordance with SSAP No. 3, *Accounting Changes and Corrections of Errors*, as of January 1, 2024, the Company recorded a $32.6 million decrease to surplus in the Statements of Income (Loss) and Changes in Capital in Surplus. The Company concluded the effects of these errors were immaterial to previously issued financial statements. For the year ended December 31, 2025 the Company recorded a $10.4 million decrease to surplus in the Statements of Income (Loss) and Changes in Capital in Surplus relating to 2024 to reflect the reversal of other operating expenses that were initially recorded as other operating expenses in Concord's Statements of Income (Loss) and Changes in Capital in Surplus for the year ended December 31, 2024. Certain immaterial errors were identified in the prior year and corrected prospectively within the Statements of Cash Flows and Notes to Statutory Financial Statements.

**Investments**

Investments are recognized in accordance with methods prescribed by the NAIC.

Investments in bonds include public and private placement bonds and mortgage-backed securities. Bonds with an NAIC designation of 1-5 are carried at amortized cost using the interest method while those with an NAIC designation of 6 are carried at the lower of amortized cost or fair value. Mortgage-backed and structured securities are assigned an NAIC designation in accordance with SSAP No. 43. Amortized cost for mortgage-backed and structured securities is determined using the interest method, utilizing anticipated cash flows based upon prepayment assumptions. When actual prepayments differ significantly from anticipated prepayments, the effective yield is recalculated to reflect actual payments to date and any resulting adjustment is included in net investment income. Amortization is adjusted for significant changes in estimated cash flows from the original purchase assumptions.

Redeemable preferred stock that has a NAIC designation of 1-3 is stated at amortized cost and those with a designation of 4-6 are carried at the lower of amortized cost or fair value. Mandatory convertible preferred, redeemable or perpetual, and perpetual preferred stocks are carried at the lower of fair value or the current effective call price.

With the exception of the Company's investment in Federal Home Loan Bank ("FHLB") common stock, unaffiliated common stock is carried at fair value. The Company's investment in FHLB common stock is carried at cost, which represents the price at which the FHLB will repurchase the stock.

The Company's has three investments in subsidiaries: Concord, Palisado and Compass HTH, LLC "(Compass"). No value is admitted for these investments.

Short-term investments and cash equivalents are carried at amortized cost. PHL considers highly liquid investments purchased between ninety days and one year of maturity to be short-term investments and highly liquid investments purchased ninety days or less of maturity to be cash equivalents.

Mortgage loans on real estate are carried at the outstanding principal balance, less any allowances for credit losses.

Contract loans are generally reported at their unpaid balances and are collateralized by the cash values of the related policies.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

Other invested assets primarily include limited partnerships, limited liability companies and residual tranches of securitizations. Interests in limited partnerships and limited liability companies are carried at cost adjusted for PHL's equity in undistributed earnings or losses since acquisition, less allowances for other-than-temporary declines in value, based upon audited financial statements in accordance with SSAP No. 48, *Joint Ventures, Partnerships and Limited Liability Companies*. Residual tranches are accounted for using the Allowable Earned Yield ("AEY") method, whereby a yield is recognized based on estimated future cash flows. Recognition of net investment income occurs when cash distributions of income are received, capped at the AEY. To the extent that the AEY exceeds the cash distributions received, such unrecognized net investment income is carried forward to future periods to be recognized when sufficient cash distributions are received. To the extent cash distributions exceed the AEY, the amortized cost of the residual tranche is reduced.

Realized capital gains and losses on investments are determined using the first-in, first-out ("FIFO") method. Those realized capital gains and losses resulting from interest rate changes are deferred and amortized to income over the stated maturity of the disposed investment utilizing the Interest Maintenance Reserve ("IMR") Grouped Method. Unrealized capital gains and losses, resulting from changes in the difference between cost and the carrying value of investments, are reflected in the Statements of Income (Loss) and Changes in Capital and Surplus.

The Company's accounting policy requires that a decline in the value of a bond or equity security below its cost or amortized cost basis be assessed to determine if the decline is other-than-temporary. In addition, for securities expected to be sold, an other-than-temporary impairment ("OTTI") charge is recognized if the Company does not expect the fair value of a security to recover to its cost or amortized cost basis prior to the expected date of sale.

Securities that are in an unrealized loss position are reviewed at least quarterly to determine if an OTTI is present based on certain quantitative and qualitative factors. The primary factors considered in evaluating whether a decline in value for securities not subject to SSAP No. 43 is other-than-temporary include: (a) the length of time and the extent to which the fair value has been less than cost or amortized cost, (b) changes in the financial condition, credit rating and near-term prospects of the issuer, and (c) whether the debtor is current on contractually obligated payments.

For securities that are not subject to SSAP No. 43, if the decline in value of a bond or equity security is other-than-temporary, a charge is recorded in net realized capital losses equal to the difference between the fair value and cost or amortized cost basis of the security. Impairment losses are recorded through the IMR.

For certain securitized financial assets with contractual cash flows (including asset-backed securities), SSAP No. 43 requires the Company to periodically update its best estimate of cash flows over the life of the security. If management determines that its best estimate of expected future cash flows discounted at the security's effective yield prior to the impairment are less than its amortized cost, then an OTTI charge is recognized equal to the difference between the amortized cost and the Company's best estimate of expected future cash flows discounted at the security's effective yield prior to the impairment. The Company's best estimate of expected future cash flows discounted at the security's effective yield prior to the impairment becomes its new cost basis. Estimating future cash flows is a quantitative and qualitative process that incorporates information received from third party sources along with certain internal assumptions and judgments regarding the future performance of the underlying collateral. As a result, actual results may differ from estimates. In addition, if the Company does not have the intent and ability to hold a security subject to the provisions of SSAP No. 43 until the recovery of value, the security is written down to fair value.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

Loans are occasionally restructured in a troubled debt restructuring. These restructurings generally include one or more of the following: full or partial payoffs outside of the original contract terms; changes to interest rates; extensions of maturity; or additions or modifications to covenants. When restructurings occur, they are evaluated individually to determine whether the restructuring or modification constitutes a "troubled debt restructuring" as defined by authoritative accounting guidance. In a troubled debt restructuring where the Company receives assets in full or partial satisfaction of the debt, any specific valuation allowance is reversed and a direct write down of the loan is recorded for the amount of the allowance and any additional loss, net of recoveries, or any gain is recorded for the difference between the fair value of the assets received and the recorded investment in the loan. Any remaining loan is evaluated prospectively for impairment. When a loan is restructured in a troubled debt restructuring, the impairment of the loan is remeasured using the modified terms and the loan's original effective yield and the allowance for loss is adjusted accordingly. Subsequent to the modification, income is recognized prospectively based on the modified terms of the loans.

**Derivatives**

Cash flows associated with derivative instruments and their related gains and losses are presented in the statement of cash flows as either proceeds of other investments or sales of other investments.

*Interest Rate Swaps*

An interest rate swap is an agreement between two parties to exchange cash flows in the future. Typically, one of the cash flow streams is based on a fixed interest rate set at the inception of the contract, and the other is a floating rate indexed to a reference rate that resets periodically. At the outset of the contract, generally, there is neither an exchange of cash nor a payment of principal by the parties; hence the term "notional principal." At each settlement date, the fixed and floating interest rates times the notional principal determine the cash flows to be exchanged, and the resulting net payment amount between these interest cash flows is made from one party to the other.

In 2024, the Company terminated all interest rate swaps. The Company used interest rate swaps to hedge against market risks in assets or liabilities from substantial changes in interest rates. In an interest rate swap, the Company agrees with another party (referred to as the counterparty) to exchange cash flows at specified intervals for a set length of time, based on the specified notional principal amount.

The Company used interest rate swaps to hedge exposure to changes in interest rates. The Company used interest rate swaps to manage interest rate exposure to certain floating rate available-for-sale debt securities where the terms or expected cash flows of the hedged item closely matched the terms or expected cash flows of the swap.

The Company valued qualified hedges at cost and changes in the value of these hedges were reflected directly through net investment income. For interest rate swaps used to hedge the cash flow variability or reinvestment risks associated with asset purchases, the impact was reflected through net investment income as the difference between income between bond coupons and swap payments.

The Company had no unrealized gain (loss) for non-qualified hedges representing interest rate swaps as of December 31, 2025, 2024 and 2023.

The Company had no net gain or loss recognized in unrealized gains (losses) during the reporting period resulting from derivatives that no longer qualify for hedge accounting.

The Company had derivatives accounted for as cash flow hedges of forecasted transactions and no derivative contracts with financing premiums.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

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*Equity Index Options*

An equity index option gives the option holder the right to buy or sell the equity index at a predetermined price (strike price) at a specified time (maturity) agreed upon at the inception of the contract. An equity index put option affords the holder the right to sell the equity index at a strike price at the maturity date while an equity index call option affords the holder the right to buy the equity index at the strike price.

The Company uses equity index put and call options. The Company is exposed to credit-related losses in the event of nonperformance by a counterparty's failure to meet its obligations. Given the Company enters into derivative contracts with a highly rated counterparty, the Company is exposed to minimum credit risk.

The Company uses equity index put options primarily to hedge against market risks or the so-called "vega" Greek risk exposure (referring to the sensitivity of the fair value of assets and liabilities to changes in equity volatility) associated with certain annuity products. The Company uses equity index options in two instances: 1) To hedge against market risks from changes in equity index price associated with certain annuity products; or 2) To replicate the option payoff profile associated with certain equity-linked life and annuity products. The statutory accounting treatment for these options is that they are valued at fair or market value, and changes in the value of these options are reflected directly through surplus.

The unrealized gain (loss) representing equity index options was $(0.3) million, $2.0 million and $(1.7) million as of December 31, 2025, 2024 and 2023, respectively.

The Company had no net gain or loss recognized in unrealized gains (losses) during the reporting period resulting from derivatives that no longer qualify for hedge accounting.

The Company had no derivatives accounted for as cash flow hedges of forecasted transactions and no derivative contracts with financing premiums.

**Net investment income**

Net investment income primarily represents interest and dividends received or accrued on bonds, preferred stock, mortgage loans, cash equivalents and short-term investments. It also includes amortization of any purchase premium or discount using the interest method, adjusted retrospectively for any change in estimated yield-to-maturity. For partnership investments, income is earned when cash distributions of income are received. Investment income due and accrued that is deemed uncollectible is charged against net investment income in the period such determination is made, while investment income greater than 90 days past due is non-admitted and charged directly to surplus. There was $7.1 million and $6.9 million gross due and accrued investment income at December 31, 2025 and 2024, respectively. There was $3.7 million and $3.7 million due and accrued investment income non-admitted at December 31, 2025 and 2024, respectively.

**Non-admitted assets**

In accordance with regulatory requirements, certain assets, including certain receivables, certain deferred tax assets and prepaid expenses, are not allowable and must be charged against surplus and are reported in the Statements of Income (Loss) and Changes in Capital and Surplus. Total non-admitted assets at December 31, 2025 and 2024 were $25.4 million and $21.2 million, respectively. Changes for the years ended December 31, 2025, 2024 and 2023 increased (decreased) surplus by $(4.2) million, $(9.5) million and $23.5 million, respectively.

**Separate accounts**

Separate account assets and liabilities are funds maintained in accounts to meet specific investment objectives of contractholders who can either choose to bear the full investment risk or can choose guaranteed investment earnings subject to certain conditions.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

For contractholders who bear the investment risk, investment income and investment gains and losses accrue directly to such contractholders. The assets of each account are legally segregated and are not subject to claims that arise out of any other business of PHL. The assets and liabilities are carried at fair value in accordance with SSAP No. 56, except for fixed index annuity contracts. Assets supporting fixed indexed annuity contracts are accounted for on a general account basis in accordance with Commissioner approval under Connecticut General Statute §38a-433. Net investment income and realized investment gains and losses for these accounts are excluded from revenues, and the related liability increases are excluded from benefits and expenses. Amounts assessed to the contractholders for management services are included in revenues.

Appreciation or depreciation of PHL's interest in the separate accounts, including undistributed net investment income, is reflected in net investment income. Contractholders' interests in net investment income and realized and unrealized capital gains and losses on separate account assets are not reflected in net income.

PHL's separate account products include variable annuities, fixed annuities, indexed annuities, supplementary contracts, payout annuities and variable life insurance contracts. Many of PHL's annuity contracts include various guaranteed minimum death, accumulation, withdrawal and income benefits. The Company currently reinsures approximately half of the death benefit guarantees associated with its in-force block of business. Reserves for the guaranteed minimum death, accumulation, withdrawal and income benefits are determined in accordance with Actuarial Guideline ("AG") 43 for indexed annuities and Valuation Manual Section 21 ("VM-21") for variable annuities.

For market value adjusted separate accounts, contractholders are credited interest at a guaranteed rate if the account is held until the end of the guarantee period. If funds are withdrawn from the account prior to the end of the guarantee period, a market value adjustment is applied, which means that the funds received may be higher or lower than the account value, depending on whether current interest rates are higher, lower or equal to the guaranteed interest rate. In these separate accounts, appreciation or depreciation of assets, undistributed net investment income and investment or other sundry expenses are reflected as net income or loss in PHL's interest in the separate accounts and transferred to the general account.

**Insurance liabilities**

Benefit and loss reserves, included in reserves for future policy benefits, are established in amounts adequate to meet estimated future obligations on policies in force. Benefits to policyholders are charged to operations as incurred.

Reserves for future policy benefits are determined using assumed rates of interest, mortality and morbidity consistent with statutory requirements. Most life insurance reserves for which the 1980 CSO mortality table is used as the mortality basis are determined using a modified preliminary term reserve method. For certain products issued on or after January 1, 2000, PHL adopted the 20 year select factors in the NAIC Valuation of Life Insurance Policies Model Regulation for both the basic and deficiency reserve, and PHL's X factors for the deficiency reserve. Annuity reserves principally use AG33 and AG35 to calculate reserve balances without guarantees, AG43 to calculate fixed indexed annuity reserve balances with guarantees and VM-21 to calculate variable annuity reserves. AG33 and AG35 use prescribed methods and assumptions to determine the minimum statutory reserves. AG43 requires that reserves for contracts are based on the greater of the Standard Scenario Amount ("SSA") and the Conditional Tail Expectation Amount ("CTE"). VM-21 requires stochastic projections to calculate CTE amounts under company and prescribed assumptions to determine the final reserve. The Company holds reserves greater than those developed under the minimum statutory reserving rules when it is determined that the minimum statutory reserves are inadequate. Actual results could differ from these estimates and may result in the establishment of additional reserves. The Company monitors actual experience and, where circumstances warrant, revises assumptions and the related estimates for policy reserves.

As of December 31, 2025 and 2024, the Company calculated its reserves for variable annuity products with guaranteed minimum death, accumulation and withdrawal benefits under VM-21. The Company calculates fixed indexed annuity reserves under the SSA of AG43, which exceeded the CTE scenario.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

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Claim and loss liabilities, included in reserves for future policy benefits, are established in amounts estimated to cover incurred losses. These liabilities are based on individual case estimates for reported losses and estimates of unreported losses based on past experience.

**Fees associated with separate accounts and other miscellaneous income**

Fees consist of contract charges assessed against the fund values and are recognized when earned.

**Premium income and related expenses**

Generally, premium income and annuity considerations for fixed payment policies are recognized when due and premium income and annuity considerations for variable payment policies or contracts is recognized as income when paid. Related underwriting expenses, commissions and other costs of acquiring the policies and contracts are charged to operations as incurred.

For deposit-type variable annuity contracts in the accumulation stage, PHL reports deposits as revenues and withdrawals as benefits. This method of reporting applies to deposits and withdrawals for both general account activity and transfers to/from separate accounts.

**Stockholder dividends**

In Connecticut, without prior approval by the insurance commissioner, the aggregate amount of dividends during any twelve month period shall not exceed the greater of (i) 10% of surplus to policyholders for the preceding calendar year or (ii) net gain from operations for such year. Connecticut law states that no dividend or other distribution exceeding an amount equal to an insurance company's earned surplus may be paid without prior approval of the insurance commissioner. Based on this calculation, the Company has no dividend capacity for 2026.

**Reinsurance**

PHL utilizes reinsurance agreements to provide for greater diversification of business and to control exposure to potential losses arising from large risks. Reinsurance arrangements do not relieve the Company as primary obligor for policyholder liabilities.

Assets and liabilities related to reinsurance ceded contracts are reported on a net basis.

Other amounts ceded on the Statements of Income (Loss) and Changes in Capital and Surplus reflect certain adjustments related to the reinsurance arrangement with Concord including interest on funds withheld, separate account income and other initial coinsurance reserve adjustments for contract claims.

Contract claims (other liabilities) arising from the moratorium are ceded to reinsurers, and the direct contract claim payable (and corresponding ceded) increase is included in the reinsurance table within Footnote 4.

Pursuant to the moratorium, the Rehabilitator developed an "Override Agreement" as a supplement to PHL reinsurance agreements with third parties. The Override Agreement provides that a reinsurer will pay PHL, on a net basis, for the full insured benefit without diminution as a result of the moratorium. The reinsurance proceeds are placed into reinsurer-specific, interest-bearing, segregated bank accounts ("Segregated Accounts"). Amounts held in the Segregated Accounts may not be withdrawn by PHL or the reinsurer other than in very limited circumstances involving hardships. As of December 31, 2025 and 2024, amounts reported within the Segregated Accounts totaled $106.8 million and $23.3 million, respectively, including interest, and are included on the Statements of Admitted Assets, Liabilities, Capital and Surplus as cash.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

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**Income taxes**

PHL Delaware is the direct parent of PHL. Effective starting in 2024, PHL and its subsidiaries, Concord and Palisado, joined the PHL Delaware consolidated return that also includes affiliate Magni Re, LTD. Consequently, PHL, Concord, and Palisado, all joined as parties to the PHL Delaware tax allocation agreement effective January 1, 2024. In January 2025, PHL formed Compass, a wholly owned subsidiary treated as a disregarded entity for tax purposes. As a disregarded entity, Compass is not a party to the 2024 tax allocation agreement.

In accordance with the 2024 tax sharing agreement, each subsidiary computes their taxable income on a separate company basis and pays its respective tax liability to PHL Delaware. PHL Delaware will utilize the tax losses and other tax attributes of its subsidiaries to offset consolidated taxable income and recognize the tax savings relating to the utilized net operating losses as a benefit in the effective rate reconciliation. Under the tax sharing agreement, PHL Delaware will pay to PHL in the current year the tax benefit of tax attributes attributable to PHL and/or its subsidiaries that are used to reduce group taxable income. PHL will pay to its subsidiary in any subsequent year the tax benefit relating to the portion of such subsidiary's tax attribute that reduces such subsidiary's taxable income on a separate company basis.

Deferred income taxes result from temporary differences between the tax basis of assets and liabilities and their recorded amounts for financial reporting purposes. Deferred tax assets are admitted in accordance with the admissibility test prescribed by SSAP No. 101. The change in deferred tax is recorded as a component of surplus. The Company's deferred tax assets were subject to a full valuation allowance as of December 31, 2025.

**Surplus notes**

On December 28, 2018, the Company issued 9.75% surplus notes that are due December 28, 2048 with a face value of $25.0 million. Interest and principal payments require the prior approval of the Department and may be made only out of surplus funds that the Department determines to be available for such payments under Connecticut insurance law. The interest on the notes is scheduled to be paid on December 28 of each year, commencing December 28, 2019. The Company did not request approval and made no interest payments for these notes in 2025, 2024 or 2023. The 9.75% surplus notes may be redeemed at the option of PHL at any time at the "make-whole" redemption price set forth in the Note Purchase Agreement. Connecticut insurance law provides that the notes are not part of the legal liabilities of PHL. PHL Holdings LLC ("PHL Holdings"), the parent company of PHL Delaware, holds the full balance of the notes.

On December 30, 2013, the Company issued 10.5% surplus notes that are due December 30, 2043 with a face value of $30.0 million. Interest and principal payments require the prior approval of the Department and may be made only out of surplus funds that the Department determines to be available for such payments under Connecticut insurance law. The interest on the notes is scheduled to be paid on December 30 of each year, commencing December 30, 2014. The Company did not request approval and made no interest payments for these notes in 2025, 2024 or 2023. The 10.5% surplus notes may be redeemed at the option of PHL at any time at the "make-whole" redemption price set forth in the Note Purchase Agreement. Connecticut insurance law provides that the notes are not part of the legal liabilities of PHL. PHL Holdings holds the full balance of the notes.

Below are the details on the outstanding surplus notes (in millions):

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|:---|:---|:---|:---|:---|:---|:---|:---|
| **Item #** | **Date<br>Issued** | **Interest<br>Rate** | **Original<br>Issue Amount<br>of Note** | **Note Holder<br>a Related<br>Party (Y/N)** | **Carrying<br>Value of<br>Notes<br>Prior Year** | **Carrying<br>Value of<br>Notes<br>Current Year** | **Unapproved<br>Interest<br>and/or<br>Principal** |
| 1000 | 12/30/2013 | 10.50% | $30 | Y | $30 | $30 | $— |
| 1001 | 12/28/2018 | 9.75% | 25.0 | Y | 25.0 | 25.0 |  |
| **Total** |  |  | $**55.0** |  | $**55.0** | $**55.0** | $**—** |

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Item #** | **Current<br>Year<br>Interest<br>Expense<br>Recognized** | **Life-to-Date<br>Interest<br>Expense<br>Recognized** | **Current<br>Year<br>Interest<br>Offset<br>Percentage** | **Current<br>Year<br>Principal<br>Paid** | **Life-to-Date<br>Principal<br>Paid** | **Date of<br>Maturity** |
| 1000 | $— | $15.8 | N/A | $— | $— | 12/30/2043 |
| 1001 |  |  | N/A |  |  | 12/28/2048 |
| **Total** | $**—** | $**15.8** |  | $**—** | $**—** |  |

---

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Item #** | **Are<br>Surplus Note<br>payments<br>contractually<br>linked<br>(Y/N)** | **Surplus Note<br>payments<br>subject to<br>administrative<br>offsetting<br>provisions<br>(Y/N)** | **Were<br>Surplus Note<br>proceeds used<br>to purchase<br>an asset<br>directly from<br>the holder of<br>the surplus<br>(Y/N)** | **Is Asset<br>Issuer a<br>Related<br>Party<br>(Y/N)** | **Types of<br>Assets** | **Principal<br>Amount of<br>Assets<br>Received<br>Upon<br>Issuance** | **Book/Adjusted<br>Carrying<br>Value of<br>Assets** | **Is Liquidity<br>Source a<br>Related<br>Party to<br>the Issuer<br>(Y/N)** |
| 1000 | N | N | N | N | Cash | $30 | $30 | N |
| 1001 | N | N | N | N | Cash | 25.0 | 25.0 | N |
| **Total** |  |  |  |  |  | $**55.0** | $**55.0** |  |

---

**Surplus**

The portion of unassigned surplus increased (reduced) by cumulative unrealized gains (losses) was $(11.9) million and $(7.4) million as of December 31, 2025 and 2024, respectively.

Pursuant to SSAP No. 72, *Surplus and Quasi-Reorganizations*, the Company reclassified its negative unassigned surplus balance of $806.3 million to gross paid-in and contributed surplus as of December 31, 2016, which had the effect of setting the Company's statutory unassigned surplus to zero as of this date. This change in accounting was approved by the Department.

The impact of any restatement due to prior quasi-reorganizations is as follows (in millions):

---

| | | |
|:---|:---|:---|
| | **Change in<br>Surplus** | **Change in<br>Gross<br>Paid-in and<br>Contributed<br>Surplus** |
| 2016 | $– $| (806.3) |

---

**Non-cash items**

The Statements of Cash Flows exclude non-cash items, such as the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Non-cash investment transactions, such as tax-free exchanges;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Accretion of amortization or accrual of discount for investments;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Depreciation expense; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Modified coinsurance ("MODCO") reinsurance adjustments, including ceded/assumed premium amounts.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The Statements of Cash Flows exclude the following significant non-cash items for the years ended December 31, 2025, 2024 and 2023, respectively as shown below, ceded under the Concord Treaty:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• $174.3 million, $225.4 million and $273.4 million of premium and annuity considerations for the years ended December 31, 2025, 2024 and 2023, respectively;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• $110.8 million, $528.6 million and $803.5 million of policyholder benefits for the years ended December 31, 2025, 2024 and 2023, respectively; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• $289.1 million, $22.3 million and $242.4 million change in funds withheld account for the years ended December 31, 2025, 2024 and 2023, respectively.

The Statements of Cash Flows also excluded the following significant non-cash items for the years ended December 31, 2025, 2024 and 2023:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• $8.8 million, $15.0 million and $1.6 million of non-cash investment exchanges for the years ended December 31, 2025, 2024 and 2023, respectively.

**3. Investments**

Information pertaining to PHL's investments, net investment income and capital gains and losses on investments follows.

**Bonds, common stock and preferred stock**

The carrying value and fair value of investments in bonds, common stock and preferred stock as of December 31, 2025 were as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Carrying<br>Value** | **Gross<br>Unrealized<br>Gains** | **Gross<br>Unrealized<br>Losses** | **Fair<br>Value** |
| **Issuer Credit Obligations** | | | | |
| U.S. government obligations (exempt from RBC) | $38431 | $131 | $(1193) | $37369 |
| Other U.S. government obligations (not exempt from RBC) | 1877 |  | (524) | 1353 |
| Non-U.S. sovereign jurisdiction securities | 239 |  | (36) | 203 |
| Municipal bonds - general obligation (direct and guaranteed) | 535 |  | (134) | 401 |
| Municipal bonds - special revenue | 16226 | 17 | (1630) | 14613 |
| Corporate bonds (unaffiliated) | 375376 | 2206 | (34519) | 343063 |
| Single entity backed obligations (unaffiliated) | 121913 | 560 | (10645) | 111828 |
| Other issuer credit obligations (unaffiliated) | 3519 | 3275 |  | 6794 |
| **Total issuer credit obligations** | $**558116** | $**6189** | $**(48681)** | $**515624** |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Asset-Backed Securities** | **Carrying<br>Value** | **Gross<br>Unrealized<br>Gains** | **Gross<br>Unrealized<br>Losses** | **Fair<br>Value** |
| **Financial Asset-Backed Securities - Self-Liquidating** | | | | |
| Agency commercial mortgage-backed securities - fully guaranteed<br> &nbsp;&nbsp;&nbsp;&nbsp;(not exempt from RBC) | $7901 | $133 | $(423) | $7611 |
| Non-agency residential mortgage-backed securities (unaffiliated) | 2305 | 175 | (144) | 2336 |
| Non-agency commercial mortgage-backed securities (unaffiliated) | 28666 | 6 | (3195) | 25477 |
| Non-agency CLOs/CBOs/CDOs (unaffiliated) | 24628 | 1 | (927) | 23702 |
| Non-agency CLOs/CBOs/CDOs (affiliated) | 4668 | 50 | (439) | 4279 |
| Other financial asset-backed securities - self-liquidating<br> &nbsp;&nbsp;&nbsp;&nbsp;(unaffiliated) | 2450 | 5 | (182) | 2273 |
| **Non-Financial Asset-Backed Securities - Practical Expedient** |  |  |  |  |
| Lease-backed transactions - practical expedient (unaffiliated) | 2532 | 5 | (110) | 2427 |
| Other non-financial asset-backed securities - practical expedient<br> &nbsp;&nbsp;&nbsp;&nbsp;(unaffiliated) | 10049 | 18 | (880) | 9187 |
| **Total asset-backed securities** | $**83199** | $**393** | $**(6300)** | $**77292** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Carrying<br>Value** | **Gross<br>Unrealized<br>Gains** | **Gross<br>Unrealized<br>Losses** | **Fair<br>Value** |
| **Total issuer credit obligations and asset-backed securities** | $**641315** | $**6582** | $**(54981)** | $**592916** |
| **Preferred stock** | $**822** | $**—** | $**—** | $**822** |
| **Common stock** | $**639** | $**—** | $**—** | $**639** |

---

The carrying value and fair value of investments in bonds, common stock and preferred stock as of December 31, 2024 were as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Carrying<br>Value** | **Gross<br>Unrealized<br>Gains** | **Gross<br>Unrealized<br>Losses** | **Fair<br>Value** |
| U.S. government | $24992 | $— | $(1759) | $23233 |
| All other governments | 238 |  | (46) | 192 |
| Political subdivisions | 6933 | 3 | (1346) | 5590 |
| Special revenue | 12787 | 16 | (1459) | 11344 |
| Industrial and miscellaneous (unaffiliated) | 458698 | 3864 | (53686) | 408876 |
| Hybrid securities | 602 |  | (27) | 575 |
| Mortgage-backed and asset-backed securities | 148926 | 310 | (18639) | 130597 |
| **Total bonds** | $**653176** | $**4193** | $**(76962)** | $**580407** |
| **Preferred stock** | $**1086** | $**—** | $**—** | $**1086** |
| **Common stock** | $**1692** | $**—** | $**—** | $**1692** |

---

The gross unrealized capital gains (losses) on bonds, common stock and preferred stock were not reflected in surplus for the years ended December 31, 2025 and 2024.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The aging of temporarily impaired general account debt securities as of December 31, 2025 was as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Less than 12 months** | **Less than 12 months** | **Greater than 12 months** | **Greater than 12 months** | **Total** | **Total** |
| | **Fair<br>Value** | **Unrealized<br>Losses** | **Fair<br>Value** | **Unrealized<br>Losses** | **Fair<br>Value** | **Unrealized<br>Losses** |
| **Issuer Credit Obligations** | | | | | | |
| U.S. government obligations (exempt from RBC) | $3113 | $(78) | $29889 | $(1115) | $33002 | $(1193) |
| Other U.S. government obligations<br> &nbsp;&nbsp;&nbsp;&nbsp;(not exempt from RBC) |  |  | 1353 | (524) | 1353 | (524) |
| Non-U.S. sovereign jurisdiction securities |  |  | 203 | (36) | 203 | (36) |
| Municipal bonds - general obligation<br> &nbsp;&nbsp;&nbsp;&nbsp;(direct and guaranteed) |  |  | 401 | (134) | 401 | (134) |
| Municipal bonds - special revenue |  |  | 12647 | (1630) | 12647 | (1630) |
| Corporate bonds (unaffiliated) | 4891 | (31) | 119563 | (34488) | 124454 | (34519) |
| Single entity backed obligations (unaffiliated) | 4162 | (66) | 96869 | (10579) | 101031 | (10645) |
| **Total issuer credit obligations** | $**12166** | $**(175)** | $**260925** | $**(48506)** | $**273091** | $**(48681)** |
| **Number of positions at unrealized loss** |  | **21** |  | **233** |  | **254** |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Less than 12 months** | **Less than 12 months** | **Greater than 12 months** | **Greater than 12 months** | **Total** | **Total** |
| **Asset-Backed Securities** | **Fair<br>Value** | **Unrealized<br>Losses** | **Fair<br>Value** | **Unrealized<br>Losses** | **Fair<br>Value** | **Unrealized<br>Losses** |
| **Financial Asset-Backed Securities - Self-Liquidating** | | | | | | |
| Agency commercial mortgage-backed securities -<br> &nbsp;&nbsp;&nbsp;&nbsp;fully guaranteed (not exempt from RBC) | $— | $— | $712 | $(423) | $712 | $(423) |
| Non-agency residential mortgage-backed securities<br> &nbsp;&nbsp;&nbsp;&nbsp;(unaffiliated) |  |  | 583 | (144) | 583 | (144) |
| Non-agency commercial mortgage-backed securities<br> &nbsp;&nbsp;&nbsp;&nbsp;(unaffiliated) |  |  | 25002 | (3195) | 25002 | (3195) |
| Non-agency CLOs/CBOs/CDOs (unaffiliated) | 10691 | (9) | 11160 | (918) | 21851 | (927) |
| Non-agency CLOs/CBOs/CDOs (affiliated) |  |  | 4229 | (439) | 4229 | (439) |
| Other financial asset-backed securities -<br> &nbsp;&nbsp;&nbsp;&nbsp;self-liquidating (unaffiliated) |  |  | 1345 | (182) | 1345 | (182) |
| **Non-Financial Asset-Backed Securities -** <br> &nbsp;&nbsp;&nbsp;&nbsp;**Practical Expedient** |  |  |  |  |  |  |
| Lease-backed transactions - practical expedient<br> &nbsp;&nbsp;&nbsp;&nbsp;(unaffiliated) | 600 | (1) | 1629 | (109) | 2229 | (110) |
| Other non-financial asset-backed securities -<br> &nbsp;&nbsp;&nbsp;&nbsp;practical expedient (unaffiliated) | 234 | (2) | 8207 | (878) | 8441 | (880) |
| **Total asset-backed securities** | $**11525** | $**(12)** | $**52867** | $**(6288)** | $**64392** | $**(6300)** |
| **Number of positions at unrealized loss** |  | **7** |  | **43** |  | **50** |

---

There were 8 below investment grade debt securities that have been in an unrealized loss position for greater than 12 months. Below investment grade unrealized losses greater than 12 months were $1.7 million.

As of December 31, 2025, securities in an unrealized loss position for greater than 12 months consisted of 276 securities. Unrealized losses were not recognized in earnings on these debt securities since the Company neither intends to sell the securities nor does it believe that it is more likely than not that it will be required to sell these securities before recovery of their amortized cost basis. Additionally, based on a security-by-security analysis, the Company expects to recover the entire amortized cost basis of these securities. In its evaluation of each security, management considered the actual recovery periods for these securities in previous periods of broad market declines. For securities with significant declines, individual security level analysis was performed, which considered any credit enhancements, expectations of defaults on underlying collateral and other available market data, including industry analyst reports and forecasts. Although there may be sustained losses for greater than 12 months on these securities, additional information was obtained related to company performance which did not indicate that the additional losses were other-than-temporary.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The aging of temporarily impaired general account debt securities as of December 31, 2024 was as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Less than 12 months** | **Less than 12 months** | **Greater than 12 months** | **Greater than 12 months** | **Total** | **Total** |
| | **Fair<br>Value** | **Unrealized<br>Losses** | **Fair<br>Value** | **Unrealized<br>Losses** | **Fair<br>Value** | **Unrealized<br>Losses** |
| **Debt Securities** | | | | | | |
| U.S. government | $106 | $(5) | $23082 | $(1754) | $23188 | $(1759) |
| All other governments |  |  | 192 | (46) | 192 | (46) |
| Political subdivisions |  |  | 5058 | (1346) | 5058 | (1346) |
| Special revenue | 983 | (17) | 9814 | (1442) | 10797 | (1459) |
| Industrial and miscellaneous | 150196 | (2230) | 229293 | (51456) | 379489 | (53686) |
| Hybrid securities | 248 | (4) | 327 | (23) | 575 | (27) |
| Mortgage-backed and asset-backed securities | 23387 | (740) | 90213 | (17899) | 113600 | (18639) |
| **Total bonds** | $**174920** | $**(2996)** | $**357979** | $**(73966)** | $**532899** | $**(76962)** |
| **Number of positions at unrealized loss** |  | **187** |  | **327** |  | **514** |

---

There were 15 below investment grade debt securities that have been in an unrealized loss position for greater than 12 months. Below investment grade unrealized losses greater than 12 months were $3.5 million.

As of December 31, 2024, securities in an unrealized loss position for greater than 12 months consisted of 327 securities. Unrealized losses were not recognized in earnings on these debt securities since the Company neither intends to sell the securities nor does it believe that it is more likely than not that it will be required to sell these securities before recovery of their amortized cost basis. Additionally, based on a security-by-security analysis, the Company expects to recover the entire amortized cost basis of these securities. In its evaluation of each security, management considered the actual recovery periods for these securities in previous periods of broad market declines. For securities with significant declines, individual security level analysis was performed, which considered any credit enhancements, expectations of defaults on underlying collateral and other available market data, including industry analyst reports and forecasts. Although there may be sustained losses for greater than 12 months on these securities, additional information was obtained related to company performance which did not indicate that the additional losses were other-than-temporary.

The carrying value and fair value of bonds as of December 31, 2025 by maturity are shown below.

---

| | | |
|:---|:---|:---|
| | **Carrying<br>Value** | **Fair<br>Value** |
| Due in one year or less | $36873 | $39654 |
| Due after one year through five years | 253009 | 250707 |
| Due after five years through ten years | 74514 | 73067 |
| Due after ten years through twenty years | 150352 | 134857 |
| Due after twenty years | 126567 | 94631 |
| **Total** | $**641315** | $**592916** |

---

Corporate bonds are shown based on contractual maturity or contractual sinking fund payments. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties, or PHL may have the right to put or sell the obligations back to the issuers. Mortgage-backed and asset-backed securities ("ABS") are not due at a single maturity date and therefore are shown based on the expected cash flows of the underlying loans, which includes estimates of anticipated future prepayments.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The carrying values of PHL's OTTI securities were $1.9 million and $9.4 million as of December 31, 2025 and 2024, respectively. The realized losses on OTTIs for impaired securities were $4.9 million, $44.5 million and $0.8 million in 2025, 2024 and 2023, respectively.

Internal and external prepayment models, which are widely accepted by the industry, are used in calculating the effective yield used in determining the carrying value of mortgage-backed and asset-backed securities. The retrospective method is applied in determining the prepayment adjustment.

**Loan-backed securities**

The Company has elected to use the book value as of January 1, 1994 as the cost for applying the retrospective adjustment method to securities purchased prior to that date, where historical cash flows are not readily available.

Prepayment assumptions for loan-backed bonds and structured securities were obtained from industry prepayment models or internal estimates. These assumptions are consistent with current interest rates and the economic environment. The retrospective adjustment method is used to value these securities.

As of December 31, 2025, the Company had no OTTI recognized because the present value of cash flows expected to be collected is greater than the amortized cost basis of the securities.

**Mortgage loans**

The Company invests in mortgage loans that are collateralized by commercial properties, including multi-family residential buildings, which are managed as a single class of commercial mortgage loans. Mortgage loans are stated at original cost, net of principal payments and amortization. The Company segregates its portfolio by property type and geographic location. As of December 31, 2025 and 2024, the market values of mortgage loans were $21.7 million and $22.0 million, respectively. The allowance for loan losses at December 31, 2025 and 2024 were $0.1 million and $0.1 million, respectively.

The following tables reflect the distribution of mortgage loans by property type as of December 31:

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| Industrial | $1056 | $1425 |
| Multifamily | 7085 | 7246 |
| Office | 9054 | 9368 |
| Retail | 5715 | 5852 |
| **Total mortgage loans** | **22910** | **23891** |
| &nbsp;&nbsp;&nbsp;Less: Allowance for loan losses | 115 | 120 |
| **Net mortgage loans** | $**22795** | $**23771** |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The following tables reflect the distribution of mortgage loans by geographic region as of December 31:

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| East North Central | $8069 | $8270 |
| Mountain | 4992 | 5112 |
| South Atlantic | 5786 | 6253 |
| West South Central | 4063 | 4256 |
| **Total mortgage loans** | **22910** | **23891** |
| &nbsp;&nbsp;&nbsp;Less: Allowance for loan losses | 115 | 120 |
| **Net mortgage loans** | $**22795** | $**23771** |

---

The following tables summarize the Company's commercial mortgage loan portfolio, net of allowance, loan-to-value ("LTV") ratios and debt-service coverage ("DSC") ratios using available data as of December 31. The ratios are updated as information becomes available.

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** |
| | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** |
| | **Greater<br>than 2.0x** | **1.8x to<br>2.0x** | **1.5x to<br>1.8x** | **1.2x to<br>1.5x** | **1.0x to<br>1.2x** | **Less than<br>1.0x** | **Total** |
| **LTV Ratios** | | | | | | | |
| &nbsp;&nbsp;&nbsp;0% - 50% | $12143 | $— | $— | $— | $— | $— | $12143 |
| &nbsp;&nbsp;&nbsp;50% - 60% | 5686 | 4966 |  |  |  |  | 10652 |
| &nbsp;&nbsp;&nbsp;60% - 70% |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;70% - 80% |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;80% and greater |  |  |  |  |  |  |  |
| **Total** | $**17829** | $**4966** | $**—** | $**—** | $**—** | $**—** | $**22795** |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** | **DSC Ratios** |
| | **Greater<br>than 2.0x** | **1.8x to<br>2.0x** | **1.5x to<br>1.8x** | **1.2x to<br>1.5x** | **1.0x to<br>1.2x** | **Less than<br>1.0x** | **Total** |
| **LTV Ratios** | | | | | | | |
| &nbsp;&nbsp;&nbsp;0% - 50% | $13715 | $— | $— | $— | $— | $— | $13715 |
| &nbsp;&nbsp;&nbsp;50% - 60% | 4234 | 5822 |  |  |  |  | 10056 |
| &nbsp;&nbsp;&nbsp;60% - 70% |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;70% - 80% |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;80% and greater |  |  |  |  |  |  |  |
| **Total** | $**17949** | $**5822** | $**—** | $**—** | $**—** | $**—** | $**23771** |

---

LTV and DSC ratios are measures frequently used in commercial real estate to determine the quality of a mortgage loan. The LTV ratio is a comparison between the current loan balance and the value assigned to the property and is expressed as a percentage. If the LTV is greater than 100%, this would indicate that the loan amount exceeds the value of the property.

The DSC ratio compares the property's net operating income to its mortgage debt service payments. If the DSC ratio is less than 1.0x, this would indicate that the property is not generating enough income after expenses to cover the mortgage payment. Therefore, a higher DSC ratio could indicate a better quality loan.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

To monitor credit quality, the Company primarily uses RBC code, which is the risk category used in the RBC calculation that is based on debt service coverage ratio and loan-to-value. The codes range from CM1 to CM7, with CM1 being the most stable. The Company holds $22.9 million CM1 loans as of December 31, 2025 and $23.9 million CM1 loans as of December 31, 2024. The maximum percentage of any one loan to the value of the collateral security at the time of the loan, exclusive of insured, guaranteed or purchase money mortgages, acquired during 2025 and 2024 was 60% and 62%, respectively. All loans are current as of December 31, 2025 and 2024. In accordance with the rehabilitation, the Company did not file an RBC filing for the year ended December 31, 2025.

During 2025, the minimum and maximum lending rates for mortgage loans were 3.6% and 4.7%, respectively. There were no taxes, assessments, or amounts advanced not included in the mortgage loan total. There were no impairments on mortgage loans or any loans derecognized as a result of foreclosure for the years ended December 31, 2025, 2024 and 2023.

**Other invested assets**

Other invested assets as of December 31 are summarized below:

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| Private equity | $20581 | $14093 |
| Direct equity | 593 | 930 |
| Credit funds | 468 | 9225 |
| Collateralized fund obligation | 3578 | 3776 |
| Mezzanine partnerships | 605 | 1077 |
| Mortgage and real estate | 29760 | 44144 |
| Surplus debentures | 1248 | 748 |
| Residual tranches | 4360 | 37676 |
| **Total other invested assets** | $**61193** | $**111669** |

---

The Company has unfunded commitments related to its investments in limited partnerships in the amount of $32.5 million and $40.6 million as of December 31, 2025 and 2024, respectively. These unfunded commitments include separate account amounts of $24.7 million and $23.9 million as of December 31, 2025 and 2024, respectively. The Company has no investments in joint ventures, partnerships or limited liability companies that exceed 10% of its admitted assets.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

**Derivative instruments**

Derivative instruments as of December 31 are summarized below:

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| **Put options:** |  |  |
| Notional amount | $5934 | $5934 |
| Fair value | $366 | $416 |
| Carrying value | $366 | $416 |
| **Call options:** |  |  |
| Notional amount | $— | $5405 |
| Fair value | $— | $532 |
| Carrying value | $— | $532 |
| **Interest rate swaps:** |  |  |
| Notional amount | $— | $— |
| Fair value | $— | $— |
| Carrying value | $— | $— |
| **Foreign currency forwards:** |  |  |
| Notional amount | $— | $— |
| Fair value | $— | $— |
| Carrying value | $— | $— |

---

**Offsetting and netting of assets and liabilities**

For the year ended December 31, 2025, the Company had net derivative assets of $0.4 million, which represented $0.7 million of gross derivative assets offset by $(0.4) million in derivative liabilities. For the year ended December 31, 2024, the Company had net derivative assets of $0.9 million, which represented $1.8 million of gross derivative assets offset by $(0.9) million in derivative liabilities.

**Restricted assets**

Restricted assets (including pledged) relate mainly to assets held under MODCO or funds withheld reinsurance agreements, statutory requirements of various jurisdictions, FHLB capital stock and derivative collateral pledged to counterparties. Restricted assets were $1,230.5 million and $3.4 million as of December 31, 2025 and 2024, respectively. The December 31, 2024 amount excluded the assets held under MODCO or funds withheld reinsurance agreements. These are included as assets on the Statements of Admitted Assets, Liabilities, Capital and Surplus.

The Company is a member of the FHLB of Boston. The Company requested withdrawal from the FHLB, and that request was approved on June 16, 2022 and will be effective on June 16, 2027. In 2025, the Company did not conduct business activity (borrowing) with the FHLB. The Company has determined the estimated maximum borrowing capacity as $0 since the Company requested withdrawal from the FHLB and such withdrawal was approved. The Company owned $0.6 million and $0.8 million of FHLB capital stock as of December 31, 2025 and 2024, respectively, which was not eligible for redemption.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

As described in Note 2, pursuant to the moratorium, the Rehabilitator developed an Override Agreement that provides that a reinsurer will pay PHL, on a net basis, for the full insured benefit without diminution as a result of the moratorium, with the reinsurance proceeds placed into Segregated Accounts. As of December 31, 2025 and 2024, amounts reported within the Segregated Accounts totaled $106.8 million and $23.3 million, respectively, including interest and are included in the Cash balance of the Statements of Admitted Assets.

**5GI Securities**

NAIC 5GI is assigned by an insurance company to certain obligations that meet all of the following criteria: (1) documentation necessary to permit a full credit analysis of a security by the NAIC Securities Valuation Office ("SVO") does not exist or an NAIC Credit Rating Provider ("CRP") credit rating for a Filing Exemption ("FE") or Private Letter ("PL") security is not available; and (2) the issuer or obligor is current on all contracted interest and principal payments; and (3) the insurer has an actual expectation of ultimate payment of all contracted interest and principal.

5GI securities as of December 31 are summarized below:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Number of 5GI Securities** | **Number of 5GI Securities** | **Aggregate BACV\*** | **Aggregate BACV\*** | **Aggregate Fair Value** | **Aggregate Fair Value** |
| | **Current<br>Year** | **Prior<br>Year** | **Current<br>Year** | **Prior<br>Year** | **Current<br>Year** | **Prior<br>Year** |
| **Investment** | | | | | | |
| (1) Bonds - Amortized Cost |  |  | $— | $— | $— | $— |
| (2) Loan-backed and structured securities****<br> - Amortized Cost |  |  |  |  |  |  |
| (3) Preferred Stock - Amortized Cost |  |  |  |  |  |  |
| (4) Preferred Stock - Fair Value | 1 |  | 658 |  | 658 |  |
| **(5) Total (1+2+3+4)** | **1** | **—** | $**658** | $**—** | $**658** | $**—** |

---

———————

*\*Book Adjusted Carrying Value*

**Investments in subsidiaries**

The table below provides the Company's loss tracking for subsidiary, controlled and affiliated ("SCA") entities:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Reporting<br>Entity's<br>Share of<br>SCA's<br>Net Income<br>(Losses)** | **Accumulated<br>Share of<br>SCA's<br>Net Income<br>(Losses)** | **Reporting<br>Entity's<br>Share of<br>SCA's Equity<br>including<br>Negative<br>Equity** | **Guaranteed<br>Obligation/Commitment<br>for Financial<br>Support<br>(Yes/No)** | **Amount of the Recognized Guarantee under SSAP No. 5** |
| Compass | $(6422) | $(6422) | $(6422) | No | $— |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

In 2021, the Department granted Concord permitted practices whereby Concord was authorized to (a) admit a receivable (the "XOL Asset") in conjunction with the XOL Agreement, (b) not record a deferred tax liability on the XOL Asset, and (c) admit a $150.0 million prepaid expense asset (the "Prepaid Asset") as an aggregate write-in for other than invested assets. As a result of the rehabilitation, the Department determined that permitted practices granted to the PHL Companies prior to the rehabilitation should be discontinued. As of December 31, 2025 and 2024, the balance of the XOL Asset was $291.1 million and $300.7 million, respectively, with the balances at December 31, 2025 and 2024 being fully non-admitted. As of December 31, 2025 and 2024, the balance of the Prepaid Asset was $86.7 million and $106.7 million, respectively with the balances at December 31, 2025 and 2024 being fully non-admitted. The Company had no guaranteed obligation or commitment for financial support to Concord or Palisado and admitted no value in these subsidiaries for the years ended December 31, 2025 and 2024.

**Concentration of credit risk of financial instruments**

Credit exposure related to issuers and derivatives counterparties is inherent in investments and derivative contracts with positive fair value or asset balances. The Company manages credit risk through the analysis of the underlying obligors, issuers and transaction structures. The Company reviews its debt security portfolio regularly to monitor the performance of obligors and assess the stability of their credit ratings. The Company also manages credit risk through industry and issuer diversification and asset allocation. The Company classifies debt securities into investment grade and below-investment-grade securities based on ratings prescribed by the NAIC. In a majority of cases, these classifications will coincide with ratings assigned by one or more Nationally Recognized Statistical Rating Organizations ("NRSRO"); however, for certain structured securities, the NAIC designations may differ from NRSRO designations based on the amortized cost of the securities in its portfolio. Maximum exposure to an issuer or derivative counterparty is defined by quality ratings, with higher quality issuers having larger exposure limits. As of December 31, 2025, the Company was not exposed to the credit concentration risk of any issuer other than U.S. government and government agencies backed by the faith and credit of the U.S. government, defined as exposure greater than 10% of total admitted assets. The top five largest exposures were NCA Realty Partners, STONE POINT CAPITAL LLC, Gridiron GP V, LLC, McFarland's Corners, and Wilmington Gardens. The Company monitors credit exposures by actively monitoring dollar limits on transactions with specific counterparties. The Company has an overall limit on below-investment-grade rated issuer exposure. Additionally, the creditworthiness of counterparties is reviewed periodically. The Company uses ISDA Master Agreements with derivative counterparties. To further mitigate the risk of loss on derivatives, the Company only enters into contracts in which the counterparty is a financial institution with a rating of A or higher from at least one NRSRO.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

**Net investment income**

The principal components of net investment income for the years ended December 31 were as follows:

---

| | | | |
|:---|:---|:---|:---|
| | **2025** | **2024** | **2023** |
| Bonds | $25557 | $24202 | $35392 |
| Preferred stock | 25 | 96 | 151 |
| Common stock | 59 | 101 |  |
| Mortgage loans | 891 | 1299 | 1939 |
| Contract loans | 3598 | 3491 | 3355 |
| Cash and short-term investments | 8456 | 6199 | 2969 |
| Other invested assets | 4649 | 7099 | 10151 |
| Derivative instruments |  | (1832) | (2667) |
| Amortization of IMR | (1724) | 205 | 2605 |
| Less: |  |  |  |
| &nbsp;&nbsp;&nbsp;Other investment expenses | 7186 | 7937 | 8720 |
| **Net investment income** | $**34325** | $**32923** | $**45175** |

---

For the years ended December 31, 2025, 2024 and 2023, the Company had no securities called or redeemed by the issuer, resulting in income from prepayment penalties and acceleration fees of $0.

**Capital gains and losses**

The principal components of realized gains (losses) and changes in unrealized capital gains (losses) on investments for the years ended December 31 were as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Realized** | **Realized** | **Realized** | **Change in Unrealized** | **Change in Unrealized** | **Change in Unrealized** |
| | **2025** | **2024** | **2023** | **2025** | **2024** | **2023** |
| Bonds | $(6327) | $(11707) | $(4231) | $83 | $222 | $(250) |
| Preferred stock |  | (89) | (70) | (14) | 96 | 431 |
| Common stock | (1495) |  |  | 617 | (670) | (600) |
| Short-term investments | (213) | 48 | (255) |  |  |  |
| Other invested assets | (1642) | (34892) | 303 | (4239) | 652 | 227 |
| Derivative instruments | 253 | (5401) | (446) | (295) | 2026 | (1732) |
| Mortgage loans | 5 | (250) | 337 |  |  |  |
| Income tax benefit (expense) |  | (14516) | (6435) |  |  |  |
| **Net capital gains (losses)** | $**(9419)** | $**(66807)** | $**(10797)** | $**(3848)** | $**2326** | $**(1924)** |

---

Realized losses include other-than-temporary impairments of $4.9 million, $44.5 million and $0.8 million for the years ended December 31, 2025, 2024 and 2023, respectively.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The proceeds and related gross realized gains and losses from sales of bonds for the years ended December 31 were as follows:

---

| | | | |
|:---|:---|:---|:---|
| | **2025** | **2024 [1]** | **2023 [1]** |
| Proceeds from sales | $56477 | $134217 | $202512 |
| Gross gains on sales | 407 | 3 | 1360 |
| Gross losses on sales | (9739) | (65182) | (30173) |

---

———————

[1] 2024 and 2023 proceeds and gross gains and losses on sales include maturities and repayments, and sales of common and preferred stock.

**4. Reserves for Future Policy Benefits and Reinsurance**

The balances for PHL's major categories of reserves for future policy benefits as of December 31 are summarized below:

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| Life insurance reserves | $1606620 | $1684024 |
| Annuity reserves | 602587 | 545582 |
| Deficiency reserves | 22832 | 18772 |
| Various | 1300000 | 1300000 |
| Total before reinsurance ceded | 3532039 | 3548378 |
| Less: Reinsurance ceded | 854569 | 1008005 |
| **Reserves for future policy benefits** | $**2677470** | $**2540373** |

---

Ceded reserves for 2025 and 2024 include the reserves ceded to Concord as further discussed in the reinsurance section of this footnote.

The Company waives deduction of deferred fractional premiums upon death of an insured and returns any portion of the final premium beyond the date of death. Surrender values are not promised in excess of the legally computed reserves.

For a policy on which the substandard extra premiums are based upon a multiple of standard mortality, the substandard extra reserve is based upon the excess of such multiple over standard mortality. For a policy carrying a flat extra premium, the extra reserve is one half of the flat extra premium.

As of December 31, 2025 and 2024, the Company had $1.3 billion and $1.1 billion, respectively, of life insurance in force for which the gross premiums are less than net premiums according to the standard of valuation set by the Department. Reserves to cover the above insurance totaled $22.8 million and $18.8 million as of December 31, 2025 and 2024, respectively.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

Tabular cost has been determined from the basic data for the calculation of policy reserves. Tabular less actual reserves released has been determined from the basic data for the calculation of reserves and reserves released. Tabular interest has been determined from the basic data for the calculation of policy reserves. Prior to 2024, Concord and Palisado were exempted from recording asset adequacy reserves ("AAR") in accordance with Section 38a-53-2 of the Regulations of Connecticut State Agencies ("AOMR Regulation") pursuant to CGS Sec. 38a-91oo. As of December 31, 2023, the AAR for the Companies was $0. However, in September 2024, the CID informed the Companies that cash flow testing ("CFT") will be required effective May 20, 2024, with any additional reserves to be carried by PHL that reflect any deficiency. As of December 31, 2025 and 2024 the estimate of the Companies' AAR is approximately $1.3 billion. The estimate is based on the CFT models and methodology employed in the "normal course" of reserve testing plus certain revised actuarial projection assumptions (e.g., lapse, mortality, interest rates), that are based on the Companies' recent experience data and updated interest rate assumptions as developed by the Rehabilitator and its advisors.

**Withdrawal characteristics**

Absent the moratorium as described in Note 2, the withdrawal characteristics of annuity actuarial reserves and deposit liabilities as of December 31 were as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **2025** | **2025** | **2025** | **2025** | **2025** |
| | **General<br>Account** | **Separate<br>Account<br>with<br>Guarantees** | **Separate<br>Account<br>Non-guaranteed** | **Total** | **% of total** |
| **Individual Annuities** |  |  |  |  |  |
| Subject to discretionary withdrawal: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- with market value adjustment | $22670 | $697587 | $— | $720257 | 27% |
| &nbsp;&nbsp;&nbsp;- at book value less surrender charge of 5% or more |  |  |  |  | —% |
| &nbsp;&nbsp;&nbsp;- at market value |  |  | 471169 | 471169 | 18% |
| Subtotal | 22670 | 697587 | 471169 | 1191426 | 45% |
| Subject to discretionary withdrawal - without adjustment: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- at book value (minimal or no charge or adjustment) | 142294 | 833090 |  | 975384 | 36% |
| &nbsp;&nbsp;&nbsp;- not subject to discretionary withdrawal | 487099 |  | 15833 | 502932 | 19% |
| **Total individual annuity actuarial reserves** | **652063** | **1530677** | **487002** | **2669742** | **100%** |
| Less: Reinsurance ceded | 144062 |  |  | 144062 |  |
| **Total individual annuity actuarial reserves,<br> net of reinsurance** | $**508001** | $**1530677** | $**487002** | $**2525680** |  |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **2024** | **2024** | **2024** | **2024** | **2024** |
| | **General<br>Account** | **Separate<br>Account<br>with<br>Guarantees** | **Separate<br>Account<br>Non-guaranteed** | **Total** | **% of total** |
| **Individual Annuities** |  |  |  |  |  |
| Subject to discretionary withdrawal: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- with market value adjustment | $25724 | $1003071 | $— | $1028795 | 36% |
| &nbsp;&nbsp;&nbsp;- at book value less surrender charge of 5% or more |  |  |  |  | —% |
| &nbsp;&nbsp;&nbsp;- at market value |  |  | 532251 | 532251 | 19% |
| Subtotal | 25724 | 1003071 | 532251 | 1561046 | 55% |
| Subject to discretionary withdrawal - without adjustment: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- at book value (minimal or no charge or adjustment) | 143916 | 676520 |  | 820436 | 29% |
| &nbsp;&nbsp;&nbsp;- not subject to discretionary withdrawal | 430554 |  | 16447 | 447001 | 16% |
| **Total individual annuity actuarial reserves** | **600194** | **1679591** | **548698** | **2828483** | **100%** |
| Less: Reinsurance ceded | 128609 |  |  | 128609 |  |
| **Total individual annuity actuarial reserves,<br> net of reinsurance** | $**471585** | $**1679591** | $**548698** | $**2699874** |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **2025** | **2025** | **2025** | **2025** | **2025** |
| | **General<br>Account** | **Separate<br>Account<br>with<br>Guarantees** | **Separate<br>Account<br>Non-guaranteed** | **Total** | **% of total** |
| **Deposit-Type Contracts (no life contingencies)** |  |  |  |  |  |
| Subject to discretionary withdrawal: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- with market value adjustment | $— | $— | $— | $— | —% |
| &nbsp;&nbsp;&nbsp;- at book value less surrender charge of 5% or more |  |  |  |  | —% |
| &nbsp;&nbsp;&nbsp;- at market value |  |  | 2051 | 2051 | 8% |
| Subtotal |  |  | 2051 | 2051 | 8% |
| Subject to discretionary withdrawal - without adjustment: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- at book value (minimal or no charge or adjustment) | 21950 |  |  | 21950 | 81% |
| Not subject to discretionary withdrawal | 2920 |  |  | 2920 | 11% |
| **Total deposit fund liabilities** | **24870** | **—** | **2051** | **26921** | **100%** |
| Less: Reinsurance ceded | 24870 |  |  | 24870 |  |
| **Total deposit fund liabilities,<br> net of reinsurance** | $**—** | $**—** | $**2051** | $**2051** |  |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **2024** | **2024** | **2024** | **2024** | **2024** |
| | **General<br>Account** | **Separate<br>Account<br>with<br>Guarantees** | **Separate<br>Account<br>Non-guaranteed** | **Total** | **% of total** |
| **Deposit-Type Contracts (no life contingencies)** |  |  |  |  |  |
| Subject to discretionary withdrawal: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- with market value adjustment | $— | $— | $— | $— | —% |
| &nbsp;&nbsp;&nbsp;- at book value less surrender charge of 5% or more |  |  |  |  | —% |
| &nbsp;&nbsp;&nbsp;- at market value |  |  | 792 | 792 | 3% |
| Subtotal |  |  | 792 | 792 | 3% |
| Subject to discretionary withdrawal - without adjustment: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- at book value (minimal or no charge or adjustment) | 24808 |  |  | 24808 | 83% |
| Not subject to discretionary withdrawal | 4121 |  |  | 4121 | 14% |
| **Total deposit fund liabilities** | **28929** | **—** | **792** | **29721** | **100%** |
| Less: Reinsurance ceded | 28929 |  |  | 28929 |  |
| **Total deposit fund liabilities,<br> net of reinsurance** | $**—** | $**—** | $**792** | $**792** |  |

---

Absent the moratorium as described in Note 2, the withdrawal characteristics of life actuarial reserves as of December 31, 2025 were as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **General Account** | **General Account** | **General Account** | **Separate Account - Non-guaranteed** | **Separate Account - Non-guaranteed** | **Separate Account - Non-guaranteed** |
| | **Account<br>Value** | **General<br>Account<br>Cash Value** | **Reserve** | **Account<br>Value** | **Cash<br>Value** | **Reserve** |
| Subject to discretionary withdrawal,****<br> surrender values or policy loans: | | | | | | |
| &nbsp;&nbsp;&nbsp;- Term policies with cash value | $59472 | $59472 | $134606 | $— | $— | $— |
| &nbsp;&nbsp;&nbsp;- Universal life | 429569 | 419785 | 511496 |  |  |  |
| &nbsp;&nbsp;&nbsp;- Universal life with secondary guarantees | 83263 | 82155 | 479905 |  |  |  |
| &nbsp;&nbsp;&nbsp;- Indexed universal life | 23765 | 23510 | 23615 |  |  |  |
| &nbsp;&nbsp;&nbsp; - Indexed universal life with secondary**** <br> guarantees |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- Indexed life |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- Other permanent cash value life insurance | 14027 | 14027 | 18086 |  |  |  |
| &nbsp;&nbsp;&nbsp;- Variable life |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- Variable universal life | 23287 | 23289 | 23776 | 118272 | 118283 | 118357 |
| &nbsp;&nbsp;&nbsp;- Miscellaneous reserves |  |  |  |  |  |  |
| Not subject to discretionary withdrawal,****<br> with no cash value: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- Term policies without cash value | XXX | XXX | 358844 | XXX | XXX |  |
| &nbsp;&nbsp;&nbsp;- Accidental death benefits | XXX | XXX | 274 | XXX | XXX |  |
| &nbsp;&nbsp;&nbsp;- Disability-active lives | XXX | XXX | 2357 | XXX | XXX |  |
| &nbsp;&nbsp;&nbsp;- Disability-disabled lives | XXX | XXX | 4117 | XXX | XXX |  |
| &nbsp;&nbsp;&nbsp;- Miscellaneous reserves | XXX | XXX | 1322897 | XXX | XXX |  |
| Total (gross: direct + assumed) | 633383 | 622238 | 2879973 | 118272 | 118283 | 118357 |
| Less: Reinsurance ceded | 186651 | 183902 | 710506 |  |  |  |
| **Total, net** | $**446732** | $**438336** | $**2169467** | $**118272** | $**118283** | $**118357** |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

Absent the moratorium as described in Note 2, the withdrawal characteristics of life actuarial reserves as of December 31, 2024 were as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **General Account** | **General Account** | **General Account** | **Separate Account - Non-guaranteed** | **Separate Account - Non-guaranteed** | **Separate Account - Non-guaranteed** |
| | **Account<br>Value** | **General<br>Account<br>Cash Value** | **Reserve** | **Account<br>Value** | **Cash<br>Value** | **Reserve** |
| Subject to discretionary withdrawal,****<br> surrender values or policy loans: | | | | | | |
| &nbsp;&nbsp;&nbsp;- Term policies with cash value | $52827 | $52827 | $137980 | $— | $— | $— |
| &nbsp;&nbsp;&nbsp;- Universal life | 448482 | 436411 | 518978 |  |  |  |
| &nbsp;&nbsp;&nbsp;- Universal life with secondary guarantees | 90805 | 88647 | 479664 |  |  |  |
| &nbsp;&nbsp;&nbsp;- Indexed universal life | 24906 | 24455 | 24599 |  |  |  |
| &nbsp;&nbsp;&nbsp; - Indexed universal life with secondary**** <br> guarantees |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- Indexed life |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- Other permanent cash value life insurance | 12405 | 12405 | 17470 |  |  |  |
| &nbsp;&nbsp;&nbsp;- Variable life |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- Variable universal life | 23304 | 23254 | 24226 | 121814 | 121824 | 121909 |
| &nbsp;&nbsp;&nbsp;- Miscellaneous reserves |  |  |  |  |  |  |
| Not subject to discretionary withdrawal,****<br> with no cash value: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;- Term policies without cash value | XXX | XXX | 419021 | XXX | XXX |  |
| &nbsp;&nbsp;&nbsp;- Accidental death benefits | XXX | XXX | 279 | XXX | XXX |  |
| &nbsp;&nbsp;&nbsp;- Disability-active lives | XXX | XXX | 2731 | XXX | XXX |  |
| &nbsp;&nbsp;&nbsp;- Disability-disabled lives | XXX | XXX | 4105 | XXX | XXX |  |
| &nbsp;&nbsp;&nbsp;- Miscellaneous reserves | XXX | XXX | 1318840 | XXX | XXX |  |
| Total (gross: direct + assumed) | 652729 | 637999 | 2947893 | 121814 | 121824 | 121909 |
| Less: Reinsurance ceded | 577898 | 563139 | 879105 |  |  |  |
| **Total, net** | $**74831** | $**74860** | $**2068788** | $**121814** | $**121824** | $**121909** |

---

**Reinsurance**

The Company's reinsurance program varies based on the type of risk, for example:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On July 18, 2023, Scottish Re (US), Inc. ("SRUS") was ordered into liquidation by the State of Delaware. As a result of the Liquidation Order, all reinsurance agreements in which SRUS was the reinsurer were terminated on September 30, 2023. As a result, management recorded an impairment of $7.7 million on net claims recoverable from SRUS. As a result of the SRUS termination, the Company recaptured the associated SRUS treaties. The related reserve credit in the amount of $54.7 million was reduced to $0, as of the termination date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Effective October 1, 2019, the Company entered into a reinsurance agreement with Concord to reinsure all of the Company's net retained business on a coinsurance funds withheld and modified coinsurance basis. The Company entered into the agreement to manage its long-term risk exposure and liquidity. For the years ended December 31, 2025 and 2024, the reserves ceded to Concord for these policies were $0.4 billion and $0.5 billion , respectively, which were reduced by a reserve impairment charge of $1,090.4 million and $952.3 million, respectively. As of December 31, 2025, these ceded reserves, and paid and unpaid losses recoverable of $0.7 billion, were collateralized by funds withheld of $1,095.4 million. As of December 31, 2024, these ceded reserves, and paid and unpaid losses recoverable of $0.3 billion, were collateralized by funds withheld of $806.3 million.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Effective October 1, 2017, the Company entered into an aggregate excess of loss reinsurance agreement with an affiliate reinsurer, Magni Re LTD, to reinsure aggregate losses on certain universal life contracts in excess of the annual attachment points specified in the treaty. The Company entered into the reinsurance treaty to manage surplus volatility associated with the Company's mortality risk. Effective January 31, 2025, the Company terminated the Magni Re reinsurance arrangement through the execution of a commutation and release agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Effective April 1, 2016, the Company entered into a MODCO treaty with affiliate, Nassau Re (Cayman) Ltd., to reinsure 50% of the existing inforce business and future sales of the Company's fixed indexed annuity contracts. Under MODCO reinsurance, the assets held for the reinsured policies, and the liabilities associated with the business are retained by the Company, and the economic risks and rewards related to the business will be ceded to Nassau Re (Cayman) Ltd. through MODCO adjustments. Effective July 1, 2017 ("Amendment Date"), the treaty was amended to include reinsurance coverage on new Term business issued on or after the Amendment Date. Effective October 1, 2018, new issues of fixed indexed annuity were no longer reinsured under the treaty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Effective June 30, 2015, the Company entered into a MODCO reinsurance agreement with affiliate, Nassau Life Insurance Company ("NNY"). This agreement provides that NNY will retrocede, and the Company will reinsure, 80% of the inforce group executive ordinary ("GEO") corporate-owned whole life insurance policies assumed by NNY from a third-party. Under MODCO, the assets, which are equal to the statutory reserves held for the reinsured policies, and liabilities associated with the assumed business are retained by NNY and the Company will receive the economic risks and rewards related to the assumed business through MODCO adjustments. Effective March 31, 2021, PHL entered into a MODCO reinsurance agreement, whereby PHL retroceded and Nassau Life and Annuity Company ("NLA") reinsures 100% of these policies assumed by PHL from NNY. As of the effective date, NLA receives the economic risks and rewards related to the assumed business through MODCO adjustments. The Company received a ceding commission of $150 million for this reinsurance transaction, which was paid to Concord who reinsures that business under the existing coinsurance funds withheld arrangement. In addition, Concord prepaid a portion of its future operating expenses. In 2021, the Department granted Concord permitted practices whereby Concord was authorized to admit the $150.0 million Prepaid Asset as an aggregate write-in for other than invested assets. As a result of the rehabilitation, the Department determined that permitted practices granted to the PHL Companies prior to the rehabilitation should be discontinued. As of December 31, 2025, the balance of the Prepaid Asset was $86.7 million, which was fully non-admitted. As of December 31, 2024, the balance of the Prepaid Asset was $106.7 million, which was fully non-admitted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• For business sold prior to December 31, 2010, the Company's retention limit on any one life is $10 million for single life and joint first-to-die policies and $12 million for joint last-to-die policies. Beginning January 1, 2011, the Company's retention limit on new business is $5 million for single life and joint first-to-die policies and $6 million for second-to-die policies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Effective November 30, 2008, the Company ceded all the benefit risks, net of existing reinsurance, on all the term life business inforce as of December 31, 2008, excluding the term plans introduced in 2008. Effective October 1, 2009, the Company ceded all benefit risks, net of existing reinsurance, on all the remaining term insurance that was not part of the November 30, 2008 transaction. In 2013, return of premium 30-year term business was recaptured by PHL.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Effective September 30, 2008, the Company entered into an agreement with affiliate, NNY, to cede 90% of all the benefit risks on Phoenix Accumulator Universal Life III and IV policies sold by PHL from January 1 to December 31, 2008. The reserves ceded to NNY for these policies were $55.7 million and $56.2 million at December 31, 2025 and 2024, respectively.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On October 8, 2007, the Company entered into a reinsurance agreement, which covers 60% of the base contract for the Phoenix Portfolio Advisors deferred variable annuity. Any riders are not covered.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

Additional information on direct business written and reinsurance assumed and ceded for the years ended December 31 is set forth below:

---

| | | | |
|:---|:---|:---|:---|
| | **2025** | **2024** | **2023** |
| Direct premiums and annuity considerations | $286907 | $374184 | $420413 |
| Reinsurance assumed - non-affiliate | 307 | 398 | 280 |
| Reinsurance assumed - affiliate | 3902 | 4379 | 3864 |
| Reinsurance ceded - non-affiliate | (79201) | (95100) | (95484) |
| Reinsurance ceded - affiliate | (211915) | (283861) | (329073) |
| **Net premiums and annuity considerations** | $**—** | $**—** | $**—** |
| Direct commissions and expense allowance | $2814 | $3612 | $4581 |
| Reinsurance assumed - non-affiliate | 78 | 100 | 290 |
| Reinsurance assumed - affiliate | 207 | 211 | 244 |
| Reinsurance ceded - non-affiliate | (339) | (522) | (200) |
| Reinsurance ceded - affiliate | (22586) | (25913) | (31674) |
| **Net commissions and expense allowance** | $**(19826)** | $**(22512)** | $**(26759)** |
| Direct policy and contract claims incurred | $485673 | 512892 | 755469 |
| Reinsurance assumed - non-affiliate | 2342 | 1074 | 2314 |
| Reinsurance assumed - affiliate | 79547 | 23310 | 82756 |
| Reinsurance ceded - non-affiliate | (128121) | (126864) | (200194) |
| Reinsurance ceded - affiliate | (439441) | (410412) | (640345) |
| **Net policy and contract claims incurred** | $**—** | $**—** | $**—** |
| Direct policy and contract claims payable | $737662 | $378245 |  |
| Reinsurance assumed - non-affiliate | 6520 | 102 |  |
| Reinsurance assumed - affiliate | 97 |  |  |
| Reinsurance ceded - non-affiliate | (23377) | (42600) |  |
| Reinsurance ceded - affiliate | (707653) | (325245) |  |
| **Net policy and contract claims payable** | $**13249** | $**10502** |  |
| Direct life insurance in force | $13583035 | $26724133 |  |
| Reinsurance assumed | 1840949 | 1797140 |  |
| Reinsurance ceded | (15423984) | (28521273) |  |
| **Net insurance in force** | $**—** | $**—** |  |

---

In the event all, including affiliated, reinsurance agreements were to be terminated, the Company estimates the aggregate reduction in surplus would be $1,117.1 million, $957.6 million and $622.7 million for the years ended December 31, 2025, 2024 and 2023, respectively.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The Company entered into a multi-product reinsurance agreement with Concord in 2019 to manage the Company's long-term risk exposure. Included in the multi-product reinsurance agreement are variable annuity contracts containing guaranteed minimum death benefits and guaranteed living benefits.

**5. Premium and Annuity Considerations Deferred and Uncollected**

Deferred and uncollected life insurance premiums and annuity considerations as of December 31, 2025 were as follows:

---

| | | |
|:---|:---|:---|
| **Type of Business** | **Gross** | **Net of Loading** |
| Ordinary new | $5 | $2 |
| Ordinary renewal | 6647 | 5057 |
| **Total** | $**6652** | $**5059** |

---

Deferred and uncollected life insurance premiums and annuity considerations as of December 31, 2024 were as follows:

---

| | | |
|:---|:---|:---|
| **Type of Business** | **Gross** | **Net of Loading** |
| Ordinary new | $8 | $2 |
| Ordinary renewal | 7118 | 5418 |
| **Total** | $**7126** | $**5420** |

---

**6. Separate Accounts**

The Company utilizes separate accounts to record and account for assets and liabilities for particular lines of business and/or transactions. For the current reporting year, the Company reported assets and liabilities from the following product lines/transactions into a separate account: Variable annuity, fixed indexed annuity, fixed annuity, payout annuity, supplementary contracts and variable universal life. Separate account products are authorized by Connecticut General Statute §38a-433 as discussed in Footnote 2.

Effective July 2018, the Company started accounting for the assets that support fixed indexed annuity contracts on a general account basis in accordance with Commissioner approval under Connecticut General Statute §38a-433. All remaining separate accounts are accounted for at fair value in accordance with SSAP No. 56.

In accordance with the products/transactions recorded within the separate account, all assets are considered legally insulated from the general account. The legal insulation of the separate account assets prevents such assets from being generally available to satisfy claims resulting from the general account. As of December 31, 2025 and 2024, the Company's separate account statement included legally insulated assets of $2,172.7 million and $2,436.0 million, respectively.

In accordance with the products/transactions recorded within the separate account, some separate account liabilities are guaranteed by the general account. In accordance with the guarantees provided, if the investment proceeds are insufficient to cover the rate of return guaranteed for the product, the policyholder proceeds will be remitted by the general account.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

To compensate the general account for the risk taken, the separate account paid risk charges of $36.8 million, $39.0 million, $43.4 million, $46.1 million and $49.1 million for the years ended December 31, 2025, 2024, 2023, 2022 and 2021, respectively. The general account paid $8.2 million, $4.6 million, $8.4 million, $7.9 million and $8.4 million relating to separate account guarantees for the years ended December 31, 2025, 2024, 2023, 2022 and 2021, respectively.

The Company does not engage in securities lending transactions within the separate accounts.

Surrenders and withdrawals were $219.2 million, $420.9 million and $285.9 million for the years ended December 31, 2025, 2024, and 2023, respectively, and were reported as benefits in the Statements of Income (Loss) and Changes in Capital and Surplus.

The analysis of PHL's separate accounts as of December 31, 2025 was as follows:

---

| | | | |
|:---|:---|:---|:---|
| | **Guaranteed** | **Non-<br>guaranteed** | **Total** |
| Premium considerations or deposits for the year ended December 31, 2025 | $679 | $4965 | $5644 |
| Reserves for account with assets at fair value as of December 31, 2025 | $3615 | $607411 | $611026 |
| Reserves for account with assets at amortized cost as of December 31, 2025 | 1527062 |  | 1527062 |
| **Total reserves** | $**1530677** | $**607411** | $**2138088** |
| By withdrawal characteristics (absent the moratorium, as described in Note 2): |  |  |  |
| &nbsp;&nbsp;&nbsp;Subject to discretionary withdrawal: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;With market value adjustment | $1523482 | $— | $1523482 |
| &nbsp;&nbsp;&nbsp;&nbsp; Without market value adjustment and with current surrender charge****<br> of 5% or more |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;At fair value |  | 591578 | 591578 |
| &nbsp;&nbsp;&nbsp;&nbsp; At market value without fair value adjustment and with current**** <br> surrender charge less than 5% | 7195 |  | 7195 |
| &nbsp;&nbsp;&nbsp;Not subject to discretionary withdrawal |  | 15833 | 15833 |
| **Total** | $**1530677** | $**607411** | $**2138088** |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The analysis of PHL's separate accounts as of December 31, 2024 was as follows:

---

| | | | |
|:---|:---|:---|:---|
| | **Guaranteed** | **Non-<br>guaranteed** | **Total** |
| Premium considerations or deposits for the year ended December 31, 2024 | $1359 | $8238 | $9597 |
| Reserves for account with assets at fair value as of December 31, 2024 | $3590 | $671458 | $675048 |
| Reserves for account with assets at amortized cost as of December 31, 2024 | 1676243 |  | 1676243 |
| **Total reserves** | $**1679833** | $**671458** | $**2351291** |
| By withdrawal characteristics (absent the moratorium, as described in Note 2): |  |  |  |
| &nbsp;&nbsp;&nbsp;Subject to discretionary withdrawal: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;With market value adjustment | $1672542 | $— | $1672542 |
| &nbsp;&nbsp;&nbsp;&nbsp; Without market value adjustment and with current surrender charge****<br> of 5% or more |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;At fair value |  | 655011 | 655011 |
| &nbsp;&nbsp;&nbsp;&nbsp;At market value without fair value adjustment and with current<br> surrender charge less than 5% | 7291 |  | 7291 |
| &nbsp;&nbsp;&nbsp;Not subject to discretionary withdrawal |  | 16447 | 16447 |
| **Total** | $**1679833** | $**671458** | $**2351291** |

---

The net transfers to and from the separate accounts, included in annuity deposit funds and net transfers to separate accounts in the Statements of Income (Loss) and Changes in Capital and Surplus at December 31, 2025 and 2024 were as follows:

---

| | | | |
|:---|:---|:---|:---|
| | **2025** | **2024** | **2023** |
| Transfers to separate accounts | $5654 | $6159 | $3701 |
| Transfers from separate accounts | (290780) | (491249) | (356091) |
| **Net transfers from (to) separate account** | **(285126)** | **(485090)** | **(352390)** |
| **Reconciling adjustments:** |  |  |  |
| MODCO allowance |  |  |  |
| **Total adjustments** | **—** | **—** | **—** |
| **Adjusted transfers from (to) separate accounts** | **(285126)** | **(485090)** | **(352390)** |
| **Transfers as reported in the Statements of Income (Loss) and**<br>**Changes in Capital and Surplus** | $**(285126)** | $**(485090)** | $**(352390)** |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

**7**. **Federal Income Taxes**

The components of the net deferred tax asset (liability) at period end and the change in those components are as follows:

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **Change** | **Change** | **Change** |
| | **Ordinary** | **Capital** | **Total** | **Ordinary** | **Capital** | **Total** | **Ordinary** | **Capital** | **Total** |
| Gross deferred tax assets | $510967 | $44566 | $555533 | $490341 | $33692 | $524033 | $20626 | $10874 | $31500 |
| Statutory valuation allowance | 501703 | 44566 | 546269 | 483654 | 28669 | 512323 | 18049 | 15897 | 33946 |
| Adjusted gross deferred tax assets | 9264 |  | 9264 | 6687 | 5023 | 11710 | 2577 | (5023) | (2446) |
| Less: Deferred tax assets non-admitted |  |  |  |  |  |  |  |  |  |
| Subtotal net admitted deferred tax assets | 9264 |  | 9264 | 6687 | 5023 | 11710 | 2577 | (5023) | (2446) |
| Less: Deferred tax liabilities | 9264 |  | 9264 | 6687 | 5023 | 11710 | 2577 | (5023) | (2446) |
| **Net deferred tax assets** | $**—** | $**—** | $**—** | $**—** | $**—** | $**—** | $**—** | $**—** | $**—** |

---

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **Change** | **Change** | **Change** |
| | **Ordinary** | **Capital** | **Total** | **Ordinary** | **Capital** | **Total** | **Ordinary** | **Capital** | **Total** |
| Federal income taxes paid in prior years**** <br> recoverable through loss carrybacks | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| Adjusted gross deferred tax assets expected to**** <br> be realized after application of the threshold**** <br> limitation |  |  |  |  |  |  |  |  |  |
| 1) Adjusted gross deferred tax assets expected to**** <br> be realized following the balance sheet date |  |  |  |  |  |  |  |  |  |
| 2) Adjusted gross deferred tax assets allowed**** <br> per limitation threshold | XXX | XXX | (358005) | XXX | XXX | (335817) | XXX | XXX | (22188) |
| Adjusted gross deferred tax assets offset by**** <br> gross deferred tax liabilities | 9264 |  | 9264 | 6687 | 5023 | 11710 | 2577 | (5023) | (2446) |
| **Deferred tax assets admitted as the result of<br> application of SSAP No. 101** | $**9264** | $**—** | $**9264** | $**6687** | $**5023** | $**11710** | $**2577** | $**(5023)** | $**(2446)** |

---

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| Ratio percentage used to determine recovery period and threshold limitation amount | —% | —% |
| Amount of adjusted capital and surplus used to determine recovery period and threshold limitation | $(2386701) | $(2238783) |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **December 31, 2025** | **December 31, 2025** | **December 31, 2024** | **December 31, 2024** | **Change** | **Change** |
| | **Ordinary** | **Capital** | **Ordinary** | **Capital** | **Ordinary** | **Capital** |
| **Impact of tax planning strategies** | | | | | | |
| Adjusted gross DTAs | $9264 | $— | $6687 | $5023 | $2577 | $(5023) |
| % of total adjusted gross DTAs | —% | —% | —% | —% | —% | —% |
| Net admitted adjusted DTAs | $9264 | $— | $6687 | $5023 | $2577 | $(5023) |
| % of total net admitted adjusted gross DTAs | —% | —% | —% | —% | —% | —% |

---

Management believes that there is insufficient positive evidence to support that it is more likely than not that the Company will realize the full tax benefits associated with its deferred tax assets and, consequently, it has recorded a full valuation allowance for statutory accounting purposes.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The components of current income taxes incurred in the Statements of Income (Loss) and Changes in Capital and Surplus and the net deferred tax asset (liability) recognized in the Company's Statements of Admitted Assets, Liabilities, Capital and Surplus at December 31, 2025 and 2024 were as follows:

---

| | | | |
|:---|:---|:---|:---|
| | **2025** | **2024** | **Change** |
| **Current income tax:** |  |  |  |
| Federal | $— | $(14517) | $14517 |
| &nbsp;&nbsp;&nbsp;**Subtotal** | **—** | **(14517)** | **14517** |
| Federal income tax on net capital gains (losses) |  | 14517 | (14517) |
| &nbsp;&nbsp;&nbsp;**Federal and foreign income tax expense (benefit) incurred** | $**—** | $**—** | $**—** |
| **Deferred tax assets:** |  |  |  |
| Ordinary: |  |  |  |
| &nbsp;&nbsp;&nbsp;Future policyholder benefits | $291152 | $297814 | $(6662) |
| &nbsp;&nbsp;&nbsp;Investments | 9765 | 8776 | 989 |
| &nbsp;&nbsp;&nbsp;Deferred acquisition costs | 42579 | 39890 | 2689 |
| &nbsp;&nbsp;&nbsp;Net operating loss carryforward | 163240 | 140577 | 22663 |
| &nbsp;&nbsp;&nbsp;Non-admitted assets | 3281 | 2412 | 869 |
| &nbsp;&nbsp;&nbsp;Other (including items <5% of total ordinary tax assets) | 950 | 872 | 78 |
| &nbsp;&nbsp;&nbsp;&nbsp;**Subtotal** | **510967** | **490341** | **20626** |
| Statutory valuation allowance adjustment | 501703 | 483654 | 18049 |
| Non-admitted |  |  |  |
| **Admitted ordinary deferred tax assets** | $**9264** | $**6687** | $**2577** |
| Capital: |  |  |  |
| &nbsp;&nbsp;&nbsp;Investments | $13859 | $33692 | $(19833) |
| &nbsp;&nbsp;&nbsp;Net capital loss carryforward | 30707 |  | 30707 |
| &nbsp;&nbsp;&nbsp;&nbsp;**Subtotal** | **44566** | **33692** | **10874** |
| Non-admitted |  |  |  |
| Statutory valuation allowance | 44566 | 28669 | 15897 |
| **Admitted capital deferred tax assets** | **—** | **5023** | **(5023)** |
| **Admitted deferred tax assets** | $**9264** | $**11710** | $**(2446)** |
| **Deferred tax liabilities:** |  |  |  |
| Ordinary: |  |  |  |
| &nbsp;&nbsp;&nbsp;Investments | $9264 | $4079 | $5185 |
| &nbsp;&nbsp;&nbsp;Policyholder reserves |  | 2608 | (2608) |
| &nbsp;&nbsp;&nbsp;&nbsp;**Subtotal** | **9264** | **6687** | **2577** |
| Capital: |  |  |  |
| &nbsp;&nbsp;&nbsp;Investments |  | 5023 | (5023) |
| &nbsp;&nbsp;&nbsp;**Deferred tax liabilities** | **9264** | **11710** | **(2446)** |
| **Net admitted deferred tax assets (liabilities)** | $**—** | $**—** | $**—** |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

Reconciliation of federal income tax rate to actual effective rate:

---

| | | | |
|:---|:---|:---|:---|
| | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** |
| | **Amount** | **Tax Effect** | **Effective<br>Tax Rate** |
| Income (loss) before taxes | $(112953) | $(23720) | 21.0% |
| Interest maintenance reserve | (4181) | (878) | 0.8% |
| Dividends received deduction | (1542) | (324) | 0.3% |
| Return to provision | (28714) | (6030) | 5.3% |
| Change in non-admitted assets | (4157) | (873) | 0.8% |
| Prior period adjustment | 120 | 25 | —% |
| Change in valuation allowance | 157806 | 33139 | (29.3%) |
| Other | (6379) | (1339) | 1.1% |
| &nbsp;&nbsp;&nbsp;**Total statutory income tax** | $**—** | $**—** | **—%** |
| Federal income taxes incurred |  | $(6030) | 5.3% |
| Prior year overaccrual (underaccrual) |  | 6030 | (5.3%) |
| &nbsp;&nbsp;&nbsp;**Total statutory income tax** |  | $**—** | **—%** |

---

---

| | | | |
|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| | **Amount** | **Tax Effect** | **Effective<br>Tax Rate** |
| Income (loss) before taxes | $(2085625) | $(437981) | 21.0% |
| Interest maintenance reserve | (24566) | (5159) | 0.2% |
| Dividends received deduction | (1228) | (258) | —% |
| TSA relief | (218) | (46) | —% |
| Return to provision | 401 | 84 | —% |
| Change in non-admitted assets | 304 | 64 | —% |
| Prior period adjustment | 2292 | 481 | —% |
| Change in valuation allowance | 2108602 | 442806 | (21.2%) |
| Other | 38 | 9 | —% |
| &nbsp;&nbsp;&nbsp;**Total statutory income tax** | $**—** | $**—** | **—%** |
| Federal income taxes incurred |  | $(14563) | 0.7% |
| Tax on capital gains (losses) |  | 14517 | (0.7%) |
| Prior year overaccrual (underaccrual) |  | 46 | —% |
| &nbsp;&nbsp;&nbsp;**Total statutory income tax** |  | $**—** | **—%** |

---

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

---

| | | | |
|:---|:---|:---|:---|
| | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
| | **Amount** | **Tax Effect** | **Effective<br>Tax Rate** |
| Income (loss) before taxes | $(173068) | $(36344) | 21.0% |
| Interest maintenance reserve | (13574) | (2851) | 1.6% |
| Dividends received deduction | (1629) | (342) | 0.2% |
| TSA relief | (7320) | (1537) | 0.9% |
| Return to provision | 293 | 62 | —% |
| Change in non-admitted assets | 2623 | 551 | (0.3%) |
| Change in valuation allowance | 331431 | 69601 | (40.2%) |
| Other | 51 | 9 | —% |
| &nbsp;&nbsp;&nbsp;**Total statutory income tax** | $**138807** | $**29149** | **(16.8** **%)** |
| Federal income taxes incurred |  | $(7943) | 4.6% |
| Tax on capital gains (losses) |  | 6435 | (3.7%) |
| Prior year overaccrual (underaccrual) |  | 1507 | (0.9%) |
| Change in net deferred income tax expense (benefit) |  | 29150 | (16.8%) |
| &nbsp;&nbsp;&nbsp;**Total statutory income tax** |  | $**29149** | **(16.8** **%)** |

---

Carryforwards, recoverable taxes and IRC 6603 deposits:

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| The Company had net operating loss carryforwards of | $777331 | $669418 |
| The Company had capital loss carryforwards of | 146224 |  |

---

As of December 31, 2025, the Company has a net operating loss carryforward of $777.3 million. The balance of the Company's net operating losses is not subject to expiration.

There is no income tax expense for 2025, 2024 and 2023 that is available for recoupment in the event of future net capital losses.

There was no aggregate amount of deposits reported as admitted assets under Section 6603 of the Internal Revenue Code as of December 31, 2025 or 2024.

The Company's U.S. federal income tax return for years 2022 and after may be selected for review by tax authorities. The Company does not anticipate any material assessments or adjustments to the Company's liability resulting from the tax examinations of prior open year periods.

Uncertain tax positions are assessed under the applicable statutory accounting guidance. There were no unrecognized tax benefits relating to uncertain tax positions for the years ended December 31, 2025 and 2024. As of December 31, 2025, the Company has recognized no amount for interest or penalties related to uncertain tax positions. Based upon existing information, the Company does not expect a material change in the recognized liability in the next 12 months. The Company has no tax loss contingencies for which it is reasonably possible that the total liability will significantly increase within twelve months of the reporting date.

------

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

PHL Delaware is the direct parent of PHL. Effective starting in 2024, PHL and its subsidiaries Concord and Palisado joined the PHL Delaware consolidated return that also includes affiliate Magni Re, LTD. Consequently, PHL, Concord, and Palisado, all joined as parties to the PHL Delaware tax allocation agreement effective January 1, 2024. In January 2025, PHL formed Compass, a wholly owned subsidiary treated as a disregarded entity for tax purposes. As a disregarded entity, Compass is not a party to the 2024 tax allocation agreement.

In accordance with the 2024 tax sharing agreement, each subsidiary computes their taxable income on a separate company basis and pays its respective tax liability to PHL Delaware. PHL Delaware will utilize the tax losses and other tax attributes of its subsidiaries to offset consolidated taxable income and recognize the tax savings relating to the utilized net operating losses as a benefit in the effective rate reconciliation. Under the tax sharing agreement, PHL Delaware will pay to PHL in the current year the tax benefit of tax attributes attributable to PHL and/or its subsidiaries that are used to reduce group taxable income. PHL will pay to its subsidiary in any subsequent year the tax benefit relating to the portion of such subsidiary's tax attribute that reduces such subsidiary's taxable income on a separate company basis.

Prior to 2024, PHL was ineligible to join the life/non-life consolidated return as it did not satisfy the five-year waiting period for life insurance companies to join non-life groups under Treas. Reg. 1.1502-47. In accordance with the PHL intercompany tax sharing agreement, each subsidiary computes their taxable income on a separate company basis and pays its respective tax liability to PHL. PHL will utilize the losses of its subsidiaries to offset consolidated taxable income and recognize the tax savings relating to the utilized net operating losses as a benefit in the effective rate reconciliation. Under the PHL tax sharing agreement, a subsidiary's tax losses are maintained on a separate company basis and carryforward to reduce such subsidiary's taxable income in future periods.

The Tax Cuts and Jobs Act provides a base erosion and anti-abuse tax ("BEAT") which represents minimum tax calculated on a base equal to the taxpayer's taxable income determined without regard to: (1) the tax benefits arising from base erosion payments, and (2) the applicable base erosion percentage of any NOL allowed for the tax year. The BEAT rate is 10% for tax years beginning in 2019 through 2025 and 12.5% for tax years beginning after December 31, 2025. The Company is a member of an "Aggregate Group" within the meaning of the IRC and the Aggregate Group's base erosion payments are less than 3% of the Aggregate Group's total deductions for the years ended December 31, 2025 and 2024. Accordingly, the BEAT liability was $0 for the years ended December 31, 2025 and 2024.

In July 2025, new tax legislation was enacted under the One Big Beautiful Bill Act (the "OBBBA"). While the OBBBA includes a wide range of provisions that could impact our financial results in future periods, we do not expect the passage of the OBBBA to have a material impact on our results of operations or financial condition in the current fiscal year.

On August 16, 2022, President Biden signed into law the Inflation Reduction Act (the "Act"). Effective for tax years beginning after December 31, 2022, the Act includes a new corporate alternative minimum tax ("CAMT") on certain corporations. The Company has determined, as of the reporting date, that they are not subject to the CAMT in 2025.

In October 2021, the Organization for Economic Co-operation and Development (the "OECD") announced the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (the "Framework"), which agreed to a two-pillar solution to address tax challenges arising from digitalization of the economy. In December 2021, the OECD released Pillar Two Model Rules defining the global minimum tax rules, which contemplate a minimum tax rate of 15%. To date, various jurisdictions have enacted, or are in the process of enacting, legislation on these rules, and the OECD continues to release additional guidance. While it is uncertain whether the U.S. will enact legislation to adopt the minimum tax directive, certain countries in which we operate have adopted legislation, and other countries are in the process of introducing legislation to implement the minimum tax directive. Further, the OECD issued administrative guidance providing transition and safe harbor rules that could delay the impact of the minimum tax directive. The Company continues to monitor the implementation of the Framework by the countries in which we operate. As of December 31, 2025, the Company meets the requirements of the transitional safe harbor and no Pillar Two accrual is required on our consolidated financial statements.

------

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

**8. Related Party Transactions**

The Nassau Companies of New York ("NCNY"), an affiliate, provides services and facilities to the Company that are reimbursed through an administrative services agreement. Expenses determined under the agreement were $11.0 million, $12.2 million and $13.7 million for the years ended December 31, 2025, 2024 and 2023, respectively. The amounts receivable from (payable) to NCNY were $1.0 million and $(5.4) million as of December 31, 2025 and 2024, respectively.

1851 Securities Inc. ("1851"), a wholly owned subsidiary of NSRE BD Holdco LLC, an affiliate, is the principal underwriter of the Company's variable universal life insurance policies and variable annuity contracts. NCNY reimburses 1851 for commissions incurred on behalf of the Company. Commissions paid by PHL to NCNY for commissions due to 1851 were $1.7 million, $2.1 million and $2.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

NNY pays commissions to producers who sold the Company's non-registered life and annuity products. The Company reimbursed NNY for commissions paid on the Company's behalf of $1.4 million, $3.4 million and $4.4 million for the years ended December 31, 2025, 2024 and 2023, respectively, which include certain commissions incurred on variable universal life insurance policies and variable annuity contracts that are paid to 1851. Commission amounts payable to NNY were $0.1 million and $0.2 million as of December 31, 2025 and 2024, respectively.

The Company's affiliate, Nassau Asset Management LLC ("NAMCO"), provides investment and related advisory services through an Investment Management Agreement. Expenses incurred under this agreement were $7.2 million, $7.4 million and $8.6 million for the years ended December 31, 2025, 2024 and 2023, respectively. There were no amounts due to NAMCO as of December 31, 2025 and 2024, respectively.

The general accounts of the Company have investments in various classes of notes of Nassau collateralized loan obligations ("CLOs") totaling $11.4 million par with a fair value of $4.3 million at December 31, 2025 and $67.8 million par with a fair value of $45.6 million at December 31, 2024. The separate accounts of the Company has investments in various classes of notes of Nassau CLOs totaling $92.1 million par with a fair value of $27.8 million at December 31, 2025 and $121.3 million par with a fair value of $57.0 million at December 31, 2024. The Nassau CLOs are managed by NGC CLO Manager, LLC and NGC UK LLP, affiliates of PHL.

In September 2019, the Company invested cash and available-for-sale debt securities in Nassau 2019 CFO, LLC ("Nassau CFO"), a collateralized fund obligation managed by an affiliate. The Company's equity investment in Nassau CFO was $9.2 million and $9.7 million at December 31, 2025 and 2024, respectively. The Company recorded no net investment income from equity investments in Nassau CFO for the years ended December 31, 2025 and 2024. The Company also invested in Class B Notes issued by Nassau CFO, which have a par value of $7.2 million and $7.2 million, and a fair value of $5.6 million and $6.5 million, at December 31, 2025 and 2024, respectively, and the Company recognized $0.5 million and $0.7 million of net investment income for the years ended December 31, 2025 and 2024, respectively.

In July 2019, the Company committed $10 million to Nassau Private Credit Onshore Fund LP. In April 2021, the Company made an additional commitment of $10 million. In June 2022, the Company made an additional commitment of $6.0 million. The Company's investment in Nassau Private Credit Onshore Fund LP has a fair value of $20.6 million and a remaining commitment of $12.7 million as of December 31, 2025.

In September 2022, the Company sold certain of its limited partnership and other invested assets to Nassau CFO 2022, a collateralized fund obligation managed by an affiliate. The Company received cash, Class C Notes, and Subordinated Notes issued by Nassau CFO 2022 as consideration with no gain or loss recognized on the sale. The Company's investment in Class C Notes issued by Nassau CFO 2022 have a par of $9.0 million and fair value of $9.0 million. The Company's investment in Subordinated Notes issued by Nassau CFO 2022 have a par of $52.8 million and fair value of $49.1 million.

In March 2022, the Company committed $20 million to NCA Realty Fund I LP. In October 2022, the Company made an additional commitment of $30 million. The Company's investment in NCA Realty Fund I LP has a fair value of $29.8 million and a remaining commitment of $3.6 million as of December 31, 2025.

------

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

See Note 4 for additional information on reinsurance agreements with affiliates.

In 2017, PHL entered into a series of transactions designed as a hedge against PHL's mortality risk. It formed several special purpose vehicles ("SPVs") to enable the acquisition of certain PHL universal life policies on the tertiary market. The Company's general account and separate account both made a secured loan to one of these SPVs to facilitate the purchase of policies, which were classified as an affiliate note on PHL's prior financial statements. The loans had semi-annual principal payments that began in 2022 with the final principal payment due in 2037 and charged interest at 8.5%. Due to unfavorable experience on the policies purchased by the SPV and associated debt service costs on the loans, the loans had been fully impaired as uncollectible in the third quarter of 2024. The impairment charge for the general account loan for the year ended December 31, 2024 was $34 million. Interest income included in other miscellaneous income for the general account for this loan was $1.5 million and $3.1 million for the years ended December 31, 2024 and 2023, respectively, in the Statements of Income (Loss) and Changes in Capital and Surplus. The impairment charge for the separate account loan was $115.0 million for the year ended December 31, 2024. Interest income included in the separate account for this loan was $5.0 million and $10.4 million for the years ended December 31, 2024 and 2023, respectively. In January 2025, following the default and impairment of the affiliate loans, PHL created a new wholly-owned subsidiary, Compass, to take an assignment of the collateral securing the loans in satisfaction of the outstanding obligations. Also in January 2025, PHL executed a promissory note with Compass. This note had a balance of $18.6 million as of December 31, 2025. Interest income on this note was $0.7 million for the year ended December 31, 2025.

**9. Fair Value Disclosures of Financial Instruments**

The fair value of an asset is the amount at which that asset could be bought or sold in a current arms-length transaction. Included in several investment related line items in the financial statements are certain financial instruments carried at fair value. Other financial instruments are periodically measured at fair value, such as when impaired, or, for certain bonds and preferred stock when carried at the lower of cost or market. The fair values presented for certain financial instruments are estimates which, in many cases, may differ significantly from the amounts which could be realized upon immediate liquidation. In cases where market prices are not available, estimates of fair value are based on discounted cash flow analyses, which utilize current interest rates for similar financial instruments, which have comparable terms and credit quality.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

**Bonds and preferred stock**

The Company uses pricing vendors to estimate fair value for the majority of its public bonds and preferred stocks. The pricing vendors' estimates are based on market data and use pricing models that vary by asset class and incorporate available trade, bid and other market information. When pricing vendors are unable to obtain evaluations based on market data, fair value is determined by obtaining a direct broker quote or by using an internal model. For the majority of private bonds and preferred stock, fair value is determined using a discounted cash flow model, which utilizes a discount rate based upon the average of spreads derived from public bond indices summed with a liquidity premium and takes into account, among other factors, the credit quality and industry sector of the issuer and the reduced liquidity associated with private placements. When the discounted cash flow model is not appropriate, the Company uses third party broker quotes or other internally developed values. Short-term investments include securities with a maturity of one year or less but greater than three months at the time of purchase and are stated at estimated fair value or amortized cost, which approximates estimated fair value.

**Common stock**

Fair values are based on quoted market prices, where available. If a quoted market price is not available, fair values are estimated using independent pricing sources or internally developed pricing models.

------

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

**Cash, cash equivalents, and short-term investments**

The carrying amounts reported in the accompanying Statements of Admitted Assets, Liabilities, Capital and Surplus for these financial instruments approximate their fair values.

**Derivatives**

Fair values for over-the-counter ("OTC"), centrally cleared and exchange-traded derivative financial instruments, principally forwards, options and swaps, represent the present value of amounts estimated to be received from or paid to a marketplace participant in settlement of these instruments (i.e., the amount the Company would expect to receive in a derivative asset assignment or would expect to pay to have a derivative liability assumed). When pricing is not directly from counterparty's valuation, then derivatives are valued using pricing models based on the net present value of estimated future cash flows and directly observed prices from exchange-traded derivatives or other OTC trades, while taking into account the counterparty's credit ratings, or the Company's own credit ratings, as appropriate. Determining the fair value for OTC derivative contracts can require a significant level of estimation and management judgment.

New and/or complex instruments may have immature or limited markets. As a result, the pricing models used for valuation often incorporate significant estimates and assumptions that market participants would use in pricing the instrument, which may impact the results of operations reported in the financial statements. For long-dated and illiquid contracts, extrapolation methods are applied to observed market data in order to estimate inputs and assumptions that are not directly observable. This enables the Company to mark-to-market all positions consistently when only a subset of prices are directly observable. Values for OTC derivatives are verified using observed information about the costs of hedging the risk and other trades in the market. As the markets for these products develop, the Company will continually refine its pricing models to correlate more closely to the market risk of these instruments.

**Residual tranches, surplus debentures and certified capital companies ("capcos")**

Fair values for residual tranches, surplus debentures and capcos are based on quoted market prices, where available, or quoted market prices of comparable instruments. If a quoted market price is not available, fair values are estimated using independent pricing sources or internally developed pricing models.

**Mortgage loans**

The Company's mortgage loans on real estate are all commercial mortgage loans, which are reported at amortized cost, less impairment write-downs and allowance for loan losses. Loans are considered impaired when it is probable that, based upon current information and events, the Company will be unable to collect all amounts due under the contractual terms of the loan agreement. When the Company determines that a loan is impaired, a valuation allowance is established for the excess carrying value of the loan over its estimated collateral value.

**Investment contracts**

PHL determines the fair value of deferred annuities with an interest guarantee of one year or less at the amount of the policy reserve. In determining the fair value of deferred annuities with interest guarantees greater than one year, the Company uses a discount rate equal to the appropriate U.S. Treasury rate plus 100 basis points to determine the present value of the projected account value of the policy at the end of the current guarantee period.

------

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

**Financial assets and liabilities measured at fair value**

The Company's financial assets and liabilities carried at fair value have been classified, for disclosure purposes, based on a hierarchy defined by SSAP No. 100, *Fair Value*. The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3). An asset's or a liability's classification is based on the lowest level input that is significant to its measurement. For example, a Level 3 fair value measurement may include inputs that are both observable (Levels 1 and 2) and unobservable (Level 3). The levels of the fair value hierarchy are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Level 1* – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 1 securities include highly liquid government bonds and exchange-traded equities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Level 2* – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Examples of such instruments include government-backed mortgage products, certain collateralized mortgage and debt obligations and certain high-yield debt securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Level 3* – inputs to the valuation methodology are unobservable and significant to the fair value measurement. Unobservable inputs reflect management's own assumptions about inputs in which market participants would use in pricing these types of assets or liabilities. Level 3 financial instruments include values which are determined using pricing models and third-party evaluation. Additionally, the determination of some fair value estimates utilizes significant management judgments or best estimates.

The following table provides information as of December 31, 2025 about the Company's financial assets and liabilities measured and reported at fair value on a recurring basis.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **2025** | **2025** | **2025** | **2025** |
| | **Level 1** | **Level 2** | **Level 3** | **Total** |
| **Assets at fair value:** |  |  |  |  |
| Issuer credit obligations | $— | $— | $6794 | $6794 |
| Preferred stock |  | 164 | 658 | 822 |
| Common stock [1] |  |  | 639 | 639 |
| Subtotal |  | 164 | 8091 | 8255 |
| Derivative assets |  | 723 |  | 723 |
| Other invested assets |  | 2229 | 3578 | 5807 |
| Separate account assets | 649707 | 82498 | 58359 | 790564 |
| **Total assets at fair value** | $**649707** | $**85614** | $**70028** | $**805349** |
| **Liabilities at fair value:** |  |  |  |  |
| Derivative liabilities | $— | $357 | $— | $357 |
| **Total liabilities at fair value** | $**—** | $**357** | $**—** | $**357** |

---

———————

[1]Includes $592 Membership FHLB common stock.

------

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

The following table provides information as of December 31, 2024 about the Company's financial assets and liabilities measured and reported at fair value on a recurring basis.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **2024** | **2024** | **2024** | **2024** |
| | **Level 1** | **Level 2** | **Level 3** | **Total** |
| **Assets at fair value:** |  |  |  |  |
| Bonds | $— | $— | $7585 | $7585 |
| Preferred stock |  | 428 | 658 | 1086 |
| Common stock [1] |  |  | 1692 | 1692 |
| Subtotal |  | 428 | 9935 | 10363 |
| Derivative assets |  | 1814 |  | 1814 |
| Other invested assets |  | 8369 | 79 | 8448 |
| Separate account assets | 779873 | 55731 | 66099 | 901703 |
| **Total assets at fair value** | $**779873** | $**66342** | $**76113** | $**922328** |
| **Liabilities at fair value:** |  |  |  |  |
| Derivative liabilities | $— | $866 | $— | $866 |
| **Total liabilities at fair value** | $**—** | $**866** | $**—** | $**866** |

---

———————

[1]Includes $767 Membership FHLB common stock.

Fair values and changes in the fair values of separate account assets generally accrue directly to the policyholders and are not included in the Company's revenues and expenses or surplus.

*Changes in Level 3 Assets and Liabilities Measured at Fair Value*

The following table summarizes the changes in assets and liabilities classified in Level 3. Gains and losses reported in this table may include changes in fair value that are attributable to both observable and unobservable inputs.

---

| | | | |
|:---|:---|:---|:---|
| | **2025** | **2024** | **2023** |
| **Level 3 Assets:** |  |  |  |
| Balance, beginning of period | $76113 | $83513 | $127168 |
| Purchases |  |  | 15448 |
| Sales | (2122) | (4448) | (6852) |
| Transfers into level 3 | 361 | 4064 | 19283 |
| Transfers out of level 3 | (2357) | (6000) | (74111) |
| Realized gains (losses) | 21071 | (9169) | 2241 |
| Unrealized gains (losses) | (23038) | 8153 | 336 |
| **Balance, end of period** | $**70028** | $**76113** | $**83513** |

---

Transfers into Level 3 primarily represent private securities for which Level 2 input assumptions for valuation pricing were no longer available. Transfers out of Level 3 for the year ended December 31, 2025 were due to the increased market observability of similar assets and/or assets previously being held at fair value now being carried at amortized cost.

------

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

Transfers out of Level 3 for the years ended December 31, 2024 and 2023 primarily represented separate account assets backing fixed indexed annuity contracts being accounted for on a general account basis as discussed in Footnote 2.

For Level 3, inputs to the valuation methodology are unobservable and significant to the fair value measurement. Unobservable inputs reflect management's best estimate of what hypothetical market participants would use to determine fair value. Examples of valuation techniques used based on unobservable inputs include, but are not limited to, internal models, direct broker quotes and professional judgment.

Below is a listing of the aggregate fair value for all financial instruments as of December 31, 2025 and the level within the fair value hierarchy:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Aggregate<br>Fair Value** | **Admitted<br>Assets** | **Level 1** | **Level 2** | **Level 3** | **Not<br>Practicable<br>(Carrying<br>Value)** |
| **Financial Instruments:** | | | | | | |
| Issuer credit obligations | $515625 | $558117 | $— | $307352 | $208273 | $— |
| Asset-backed securities | 77291 | 83198 |  | 64796 | 12495 |  |
| Preferred stock | 822 | 822 |  | 164 | 658 |  |
| Common stock | 639 | 639 |  |  | 639 |  |
| Residual tranches & surplus debentures | 9075 | 5607 |  | 5497 | 3578 |  |
| Cash, cash equivalents & short-term investments | 325654 | 475635 | 221178 | 104476 |  |  |
| Derivatives | 366 | 366 |  | 366 |  |  |
| Mortgage loans | 21682 | 22795 |  |  | 21682 |  |
| Separate account assets | 1963596 | 2046731 | 649707 | 700471 | 613418 |  |
| **Total financial instruments** | $**2914750** | $**3193910** | $**870885** | $**1183122** | $**860743** | $**—** |

---

Consistent with SSAP No. 100, certain financial instruments are not included within the table above (e.g., investments accounted for under the equity method).

As of December 31, 2025, the Company had no investments where it is not practicable to estimate fair value.

Below is a listing of the aggregate fair value for all financial instruments as of December 31, 2024 and the level within the fair value hierarchy:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Aggregate<br>Fair Value** | **Admitted<br>Assets** | **Level 1** | **Level 2** | **Level 3** | **Not<br>Practicable<br>(Carrying<br>Value)** |
| **Financial Instruments:** | | | | | | |
| Bonds | $580407 | $653176 | $— | $342207 | $238200 | $— |
| Preferred stock | 1086 | 1086 |  | 428 | 658 |  |
| Common stock | 1692 | 1692 |  |  | 1692 |  |
| Residual tranches & surplus debentures | 42332 | 38837 |  | 42253 | 79 |  |
| Cash, cash equivalents & short-term investments | 121109 | 121121 | 94362 | 26747 |  |  |
| Derivatives | 948 | 948 |  | 948 |  |  |
| Mortgage loans | 21775 | 23771 |  |  | 21775 |  |
| Separate account assets | 2161762 | 2291523 | 779873 | 690336 | 691553 |  |
| **Total financial instruments** | $**2931111** | $**3132154** | $**874235** | $**1102919** | $**953957** | $**—** |

---

As of December 31, 2024, the Company had no investments where it is not practicable to estimate fair value.

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| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

For the years ended December 31, 2025 and 2024, Level 3 bonds and separate account assets were primarily private placement debt securities priced using the Company's internal discounted cash flow model. Market spreads used in the model were unobservable. Nearly all of these securities were in the Issuer Credit Obligations and Asset Backed Security categories for 2025 and in the Industrial and Miscellaneous category for 2024.

**10. Commitments and Contingencies**

**Litigation and regulatory matters**

The Company is regularly involved in litigation and arbitration, both as a defendant and as a plaintiff. The litigation and arbitration naming the Company as a defendant ordinarily involves the Company's businesses and operations. In certain of these matters, the plaintiffs are seeking large and/or indeterminate amounts, including punitive or exemplary damages.

The Company periodically receives informal and formal requests for information from various state and federal governmental agencies and self-regulatory organizations related to the Company's products and practices. It is the Company's practice to cooperate fully in these matters.

As reported in Note 1, in response to the PHL Companies' hazardous financial condition, the PHL Companies entered rehabilitation proceedings in the Connecticut Superior Court on May 20, 2024. At the time of the Rehabilitator Order, the Companies were parties to a number of lawsuits in federal and state courts throughout the country. The Rehabilitator assessed the status of all pending proceedings, and where appropriate based on the status and merits of the proceedings, stayed the proceedings pursuant to the Rehabilitation Order.

It is not feasible to predict or determine the ultimate outcome of all litigation, arbitration or regulatory proceedings or to provide reasonable ranges of potential losses. Given the Company's current financial condition as more fully described in Note 2, and the large or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation, arbitration and regulatory investigations, it is possible that an adverse outcome in certain matters could, from time to time, have a material adverse effect on the results of operations or cash flows in particular annual periods.

**Cost of insurance litigation related to the 2021 adjustment**

On April 15, 2022, a putative class action was filed against PHL Variable Insurance Company in the United States District Court for the District of Connecticut challenging certain increases to cost of insurance charges implemented by the Company in 2021. Kenney v. PHL Variable Insurance Company, 3:22-cv-00552. On June 21, 2022, the Company filed its answer. On February 14, 2024, an amended class action complaint was filed in the Kenney case. The amended complaint adds a new plaintiff, Arbuckle Funding LLC, as well as nine new defendants including two subsidiaries of the Company, Concord Re, Inc. and Palisado Re, Inc., as well as seven Nassau entities, including Nassau Insurance Group Holdings, L.P.; Nassau Insurance Group Holdings GP, LLC; Nassau Financial Group GP Ltd.; Nassau Financial Group, L.P.; Nassau Asset Management LLC; The Nassau Companies of New York; and The Nassau Companies. The amended complaint retains its breach of contract cause of action against the Company challenging the cost of insurance charges implemented in 2021 and adds the Nassau defendants to the breach of contract cause of action under an "alter ego" theory. The amended class action complaint also alleges a new cause of action for fraudulent transfer against all defendants and a new cause of action against the Nassau entities for interference with contract. Pursuant to the rehabilitation proceedings, this matter has been stayed. The Company disputes the allegations in the complaint and intends a vigorous defense.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Notes to Statutory Financial Statements** | **(continued)** |
| *(in thousands except where noted in millions or billions)* | |

---

**11. Other Commitments**

As part of its normal investment activities, the Company enters into agreements to fund limited partnerships that make debt and equity investments. As of December 31, 2025, the Company had unfunded commitments of $32.5 million, which includes $24.7 million relating to separate account commitments.

**12. Information about Financial Instruments with Off-Balance Sheet Risk**

The Company, at December 31, 2025 and 2024, held no instruments with off-balance sheet risk.

The Company uses derivative instruments including equity index options. A more detailed description of these instruments is provided in Footnote 2 - "Summary of Significant Accounting Policies."

As a result of the Company entering rehabilitation, the counterparty terminated all interest rate swaps. The termination resulted in a loss of $18.4 million for the year ended December 31, 2024.

The current credit exposure of the Company's derivative contracts is limited to the fair value at the reporting date. Credit risk is managed with derivative counterparties – mostly highly rated counterparties rated A+ or higher. The Company also attempts to minimize its exposure to credit risk through the use of issuer limits and various credit monitoring techniques. The Company held $0 cash in 2025, of collateral pledged by third parties related to over-the-counter derivative transactions.

**13. Subsequent Events**

The Company evaluated events subsequent to December 31, 2025 and through April 14, 2026, the date the Company's statutory financial statements were available to be issued. On July 21, 2025, the Rehabilitator proposed modifications to the moratorium. The proposed modifications seek to ease the current restrictions imposed by the moratorium on owners of certain non-variable universal life insurance policies and certain owners of fixed indexed annuities. On December 24, 2025, the Court granted the motion to modify the moratorium. During March 2026, election packages began to be mailed to eligible policy and annuity holders, which gave those policy and annuity holders 45 days to elect one of the options available to them under the moratorium modifications. One of the options available to certain non-variable universal life insurance policies is to surrender the policy, stop paying cost of insurance charges or premiums and establish a claim in the rehabilitation proceedings. The basis for such a claim would be the policy's cash surrender value as of the election date plus an enhancement equal to the amount the policyholder has paid in cost of insurance charges from July 1, 2024 to November 28, 2025, resulting in an adjusted surrender value ("ASV"). If a policyholder elects this option, all premiums paid in cash after November 1, 2025 will be refunded and all cost of insurance deducted after this date reversed. The election of this option allows the policyholder to fix a claim for the ASV with no ongoing obligation for cost of insurance charges or premium payments. If a large number of policyholders elect the ASV option, it may have a material impact on the Company's reserves for future policy benefits and contract claims (other liabilities).

There were no other material events occurring subsequent to the end of the year that merited recognition or disclosure in these financial statements.

------

---

| |
|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Supplemental Schedule**<br> **Summary of Investments - Other than Investments in Related Parties**<br> **December 31, 2025** |
| *(in thousands)* |

---

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized<br>Cost** | **Fair<br>Value** | **Amount shown<br>in the<br>Balance Sheet** |
| **Fixed maturities:** | | | |
| &nbsp;&nbsp; Bonds: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; U.S. government and government agencies and authorities | $40308 | 38722 | $40308 |
| &nbsp;&nbsp;&nbsp;&nbsp; States, municipalities and political subdivisions | 16761 | 15014 | 16761 |
| &nbsp;&nbsp;&nbsp;&nbsp; Foreign governments | 239 | 203 | 239 |
| &nbsp;&nbsp;&nbsp;&nbsp; All other corporate bonds [1] | 579339 | 534699 | 579339 |
| &nbsp;&nbsp;&nbsp;&nbsp; Redeemable preferred stock | 908 | 822 | 822 |
| **Total fixed maturities** | **637555** | **589460** | **637469** |
| **Equity securities:** |  |  |  |
| &nbsp;&nbsp; Common stock: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Industrial, miscellaneous and all other | 592 | 639 | 639 |
| &nbsp;&nbsp;&nbsp;&nbsp; Nonredeemable preferred stock |  |  |  |
| **Total equity securities** | **592** | **639** | **639** |
| Mortgage loans | 22795 | 21567 | 22795 |
| Real estate, at depreciated cost |  | XXX |  |
| Contract loans | 73883 | XXX | 73883 |
| Other invested assets [1] | 27386 | 27275 | 27386 |
| Cash and short-term investments | 475635 | 475636 | 475635 |
| Receivables for securities | 3752 | XXX | 3752 |
| **Total cash and invested assets** | $**1241598** |  | $**1241559** |

---

———————

[1] Amortized cost and fair value amounts exclude $38,474 and $38,085, respectively, of related-party bonds and other invested assets.

See accompanying independent auditors' report.

------

---

| | |
|:---|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Supplemental Schedule**<br> **Summary of Investments - Other than Investments in Related Parties**<br> **December 31, 2024** | **(continued)** |
| *(in thousands)* | |

---

---

| | | | |
|:---|:---|:---|:---|
| | **Amortized<br>Cost** | **Fair<br>Value** | **Amount shown<br>in the<br>Balance Sheet** |
| **Fixed maturities:** | | | |
| &nbsp;&nbsp; Bonds: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; U.S. government and government agencies and authorities | $24992 | $23233 | $24992 |
| &nbsp;&nbsp;&nbsp;&nbsp; States, municipalities and political subdivisions |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Foreign governments | 238 | 192 | 238 |
| &nbsp;&nbsp;&nbsp;&nbsp; All other corporate bonds [1] | 618134 | 547780 | 618051 |
| &nbsp;&nbsp;&nbsp;&nbsp; Redeemable preferred stock | 1158 | 1086 | 1086 |
| **Total fixed maturities** | **644522** | **572291** | **644367** |
| **Equity securities:** |  |  |  |
| &nbsp;&nbsp; Common stock: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Industrial, miscellaneous and all other | 2262 | 1692 | 1692 |
| &nbsp;&nbsp;&nbsp;&nbsp; Nonredeemable preferred stock |  |  |  |
| **Total equity securities** | **2262** | **1692** | **1692** |
| Mortgage loans | 23771 | 21655 | 23771 |
| Real estate, at depreciated cost |  | XXX |  |
| Contract loans | 74874 | XXX | 74874 |
| Other invested assets [1] | 54523 | 58430 | 54523 |
| Cash and short-term investments | 121121 | 121109 | 121121 |
| Receivables for securities | 6512 | XXX | 6512 |
| **Total cash and invested assets** | $**927585** |  | $**926860** |

---

———————

[1] Amortized cost and fair value amounts exclude $67,041 and $66,346, respectively, of related-party bonds and other invested assets. Certain affiliated investments were included in all other corporate bonds and other investment assets in 2024. These investments have been removed in the 2025 disclosure.

See accompanying independent auditors' report.

------

---

| |
|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Supplementary Insurance Information**<br> **For the years ended December 31, 2025 and 2024** |
| *(in thousands)* |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **As of December 31,** | **As of December 31,** | **For the years ended December 31,** | **For the years ended December 31,** | **For the years ended December 31,** | **For the years ended December 31,** |
| | **Future policy<br>benefits,<br>losses and<br>claims** | **Other<br>policy claims<br>and benefits<br>payable** | **Premium<br>and annuity<br>considerations** | **Net<br>investment<br>income** | **Benefits,<br>claims and<br>losses** | **Other<br>operating<br>expenses** |
| **2025:** | | | | | | |
| &nbsp;&nbsp;&nbsp;Insurance Segment | $2677470 | $1617 | $— | $34325 | $(148130) | $228334 |
| **2024:** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Insurance Segment | $2540373 | $7880 |  | $32923 | $1608798 | $287014 |
| **2023:** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Insurance Segment | $390248 | $4172 | $— | $45175 | $(158721) | $281532 |

---

See accompanying independent auditors' report

------

---

| |
|:---|
| **PHL Variable Insurance Company, In Rehabilitation**<br> ***(a wholly owned subsidiary of PHL Delaware, LLC)***<br> **Supplementary Schedule - Reinsurance**<br> **For the years ended December 31, 2025, 2024 and 2023** |
| *(in thousands)* |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Gross<br>amount** | **Reinsurance<br>ceded** | **Reinsurance<br>assumed** | **Net<br>amount** | **Percentage of<br>assumed to net** |
| **Life insurance in force:** | | | | | |
| &nbsp;&nbsp; 2025 | $13583035 | $15423984 | $1840949 | $— | —% |
| &nbsp;&nbsp; 2024 | 26724133 | 28521273 | 1797140 |  | —% |
| &nbsp;&nbsp; 2023 | 31553595 | 33255328 | 1701733 |  | —% |
| **Life insurance premiums:** |  |  |  |  |  |
| &nbsp;&nbsp; 2025 | $286907 | $291116 | $4209 | $— | —% |
| &nbsp;&nbsp; 2024 | 374184 | 378961 | 4777 |  | —% |
| &nbsp;&nbsp; 2023 | 420413 | 424557 | 4144 |  | —% |

---

See accompanying independent auditors' report

![](tm2610824d2_nvpfs-img01.jpg)

------

Financial Statements

PHL Variable Accumulation Account

December 31, 2025

With Report of Independent Registered Public Accounting Firm

PHL Variable Accumulation Account

Financial Statements

December 31, 2025

Contents

Audited Financial Statements

---

| | |
|:---|:---|
| Statements of Net Assets | 5 |
| Statements of Operations and Change in Net Assets | 7 |
| Notes to Financial Statements | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note 1. Organization | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note 2. Additions, Mergers, Liquidations and Name Changes | 27 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note 3. Significant Accounting Policies | 27 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note 4. Purchases and Proceeds from Sales of Investments | 32 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note 5. Related Party Transactions and Charges and Deductions | 34 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note 6. Summary of Unit Transactions | 37 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note 7. Financial Highlights | 40 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note 8. Subsequent Events | 52 |
| Report of Independent Registered Public Accounting Firm | 53 |

---

PHL Variable Accumulation Account<br> Statements of Net Assets<br> December 31, 2025

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| Subaccount | Number of<br> Shares | Cost | Assets at<br> Market Value | Net Assets | Units<br> Outstanding | Range of Unit Values | Range of Unit Values |
| &nbsp;&nbsp;AB VPS Balanced Hedged Allocation Portfolio | 105094 | $1195270 | $1033075 | $1033075 | 479258 | $2.01 | $2.26 |
| &nbsp;&nbsp;Alger Capital Appreciation Portfolio | 18879 | 792135 | 2432593 | 2432593 | 134030 | 14.55 | 26.72 |
| &nbsp;&nbsp;Columbia Variable Portfolio – Acorn Fund (a) | 1108385 | 21409181 | 17623323 | 17623323 | 1523859 | 2.93 | 13.05 |
| &nbsp;&nbsp;Columbia Variable Portfolio – Acorn International Fund (a) | 875228 | 21540776 | 17889664 | 17889664 | 4596839 | 1.53 | 9.55 |
| &nbsp;&nbsp;CVT S&P MidCap 400 Index Portfolio (a) | 7270 | 495173 | 926379 | 926379 | 223462 | 3.71 | 4.48 |
| &nbsp;&nbsp;DWS Equity 500 Index VIP | 448309 | 5159684 | 14592470 | 14592470 | 1160903 | 4.77 | 15.14 |
| &nbsp;&nbsp;DWS Small Cap Index VIP | 24394 | 332490 | 366396 | 366396 | 102809 | 3.31 | 3.79 |
| &nbsp;&nbsp;Federated Hermes Fund for U.S. Government Securities II | 1665352 | 19230373 | 15504430 | 15504430 | 5709912 | 1.11 | 3.57 |
| &nbsp;&nbsp;Federated Hermes Government Money Fund II | 10573336 | 10573336 | 10573336 | 10573336 | 10952113 | 0.83 | 1.03 |
| &nbsp;&nbsp;Federated Hermes High Income Bond Fund II | 344954 | 2623144 | 1993833 | 1993833 | 384346 | 2.21 | 7.10 |
| &nbsp;&nbsp;Fidelity® VIP Contrafund® Portfolio | 280966 | 7620726 | 16669736 | 16669736 | 1140167 | 5.52 | 21.09 |
| &nbsp;&nbsp;Fidelity® VIP Growth Opportunities Portfolio | 378881 | 6669777 | 37547120 | 37547120 | 2889731 | 8.45 | 23.42 |
| &nbsp;&nbsp;Fidelity® VIP Growth Portfolio | 97897 | 3739336 | 9452923 | 9452923 | 744600 | 7.00 | 16.41 |
| &nbsp;&nbsp;Fidelity® VIP Investment Grade Bond Portfolio | 1002449 | 12402137 | 11207375 | 11207375 | 7632000 | 1.35 | 1.60 |
| &nbsp;&nbsp;Franklin Income VIP Fund | 438195 | 7448941 | 6643033 | 6643033 | 2982915 | 2.08 | 2.70 |
| &nbsp;&nbsp;Franklin Mutual Shares VIP Fund | 541724 | 9097518 | 8721751 | 8721751 | 2701006 | 1.99 | 8.70 |
| &nbsp;&nbsp;FTVIP Franklin DynaTech Fund | 30571 | 207357 | 201154 | 201154 | 37797 | 4.90 | 5.71 |
| &nbsp;&nbsp;Invesco V.I. American Franchise Fund | 98975 | 3914220 | 8017007 | 8017007 | 1513797 | 4.90 | 5.55 |
| &nbsp;&nbsp;Invesco V.I. Core Equity Fund | 50830 | 1320807 | 1831389 | 1831389 | 446976 | 3.70 | 4.43 |
| &nbsp;&nbsp;Invesco V.I. Discovery Large Cap Fund (a) | 11325 | 492372 | 671000 | 671000 | 138419 | 4.45 | 5.32 |
| &nbsp;&nbsp;Invesco V.I. Equity and Income Fund | 47167 | 748694 | 854670 | 854670 | 282741 | 2.68 | 3.34 |
| &nbsp;&nbsp;Invesco V.I. Global Fund | 16345 | 572565 | 593334 | 593334 | 179370 | 3.02 | 3.77 |
| &nbsp;&nbsp;Invesco V.I. Main Street Mid Cap Fund® | 49207 | 631473 | 541767 | 541767 | 156398 | 3.17 | 3.84 |
| &nbsp;&nbsp;Invesco V.I. Main Street Small Cap Fund® | 363048 | 7086128 | 10060056 | 10060056 | 2936974 | 3.28 | 3.92 |
| &nbsp;&nbsp;Lazard Retirement US Small Cap Equity Select Portfolio | 25411 | 603070 | 329071 | 329071 | 102325 | 2.98 | 3.49 |
| &nbsp;&nbsp;Lord Abbett Series Fund Bond Debenture Portfolio | 130713 | 1484069 | 1386865 | 1386865 | 598836 | 2.02 | 2.56 |
| &nbsp;&nbsp;Lord Abbett Series Fund Growth and Income Portfolio | 443909 | 12157098 | 18626413 | 18626413 | 4966807 | 2.89 | 4.06 |
| &nbsp;&nbsp;Lord Abbett Series Fund Mid Cap Stock Portfolio | 49025 | 1021692 | 1277094 | 1277094 | 438041 | 2.23 | 3.26 |
| &nbsp;&nbsp;Morningstar Aggressive Growth ETF Asset Allocation Portfolio | 127539 | 1201851 | 2171988 | 2171988 | 724842 | 2.78 | 3.19 |
| &nbsp;&nbsp;Morningstar Balanced ETF Asset Allocation Portfolio | 988072 | 10330738 | 11115808 | 11115808 | 5259176 | 1.97 | 2.26 |

---

(a) Name change. See Note 2.

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account<br> Statements of Net Assets (continued)<br> December 31, 2025

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| SubAccount | Number of<br> Shares | Cost | Assets at<br> Market Value | Net Assets | Units<br> Outstanding | Range of Unit Values | Range of Unit Values |
| &nbsp;&nbsp;Morningstar Growth ETF Asset Allocation Portfolio | 309223 | $3010264 | $4128121 | $4128121 | 1585374 | $2.43 | $2.79 |
| &nbsp;&nbsp;Morningstar Income and Growth ETF Asset Allocation Portfolio | 719565 | 7575399 | 7490669 | 7490669 | 4495006 | 1.52 | 1.79 |
| &nbsp;&nbsp;Neuberger Berman AMT Mid Cap Growth Portfolio | 26546 | 678618 | 637630 | 637630 | 270848 | 2.23 | 2.45 |
| &nbsp;&nbsp;Neuberger Berman AMT Quality Equity Portfolio (a) | 377242 | 9995455 | 16153483 | 16153483 | 7460278 | 2.10 | 2.23 |
| &nbsp;&nbsp;PIMCO CommodityReal Return® Strategy Portfolio | 1258143 | 29085234 | 8077276 | 8077276 | 9603103 | 0.76 | 0.91 |
| &nbsp;&nbsp;PIMCO Real Return Portfolio | 44597 | 556463 | 535615 | 535615 | 341504 | 1.40 | 1.68 |
| &nbsp;&nbsp;PIMCO Total Return Portfolio | 180670 | 1832286 | 1707328 | 1707328 | 1049259 | 1.44 | 1.77 |
| &nbsp;&nbsp;Rydex VT Inverse Government Long Bond Strategy Fund | 714 | 235869 | 77994 | 77994 | 253865 | 0.29 | 0.35 |
| &nbsp;&nbsp;Rydex VT Nova Fund | 548 | 21103 | 140921 | 140921 | 13706 | 9.37 | 11.51 |
| &nbsp;&nbsp;Templeton Developing Markets VIP Fund | 79133 | 729532 | 955929 | 955929 | 340761 | 1.66 | 8.63 |
| &nbsp;&nbsp;Templeton Foreign VIP Fund | 161648 | 2474071 | 2621927 | 2621927 | 755571 | 1.41 | 5.16 |
| &nbsp;&nbsp;Templeton Growth VIP Fund | 549748 | 7269638 | 7778932 | 7778932 | 3151663 | 1.61 | 6.95 |
| &nbsp;&nbsp;TVST Touchstone Balanced Fund | 40942 | 510095 | 580563 | 580563 | 182874 | 2.80 | 3.40 |
| &nbsp;&nbsp;TVST Touchstone Bond Fund | 900634 | 9113018 | 7889552 | 7889552 | 5545143 | 1.30 | 1.54 |
| &nbsp;&nbsp;TVST Touchstone Common Stock Fund | 2611413 | 36592318 | 33713342 | 33713342 | 6560376 | 4.71 | 5.57 |
| &nbsp;&nbsp;TVST Touchstone Small Company Fund | 349649 | 5058276 | 4958021 | 4958021 | 1233050 | 3.68 | 4.35 |
| &nbsp;&nbsp;Virtus Duff & Phelps Real Estate Securities Series | 673456 | 15935910 | 13785654 | 13785654 | 3275706 | 2.20 | 21.33 |
| &nbsp;&nbsp;Virtus KAR Capital Growth Series | 744987 | 16595995 | 25389165 | 25389165 | 4371509 | 4.13 | 9.52 |
| &nbsp;&nbsp;Virtus KAR Enhanced Core Equity Series | 1531176 | 17571358 | 19354064 | 19354064 | 3639658 | 2.67 | 7.57 |
| &nbsp;&nbsp;Virtus KAR Small-Cap Growth Series | 748607 | 10681934 | 11468658 | 11468658 | 711222 | 3.59 | 17.83 |
| &nbsp;&nbsp;Virtus KAR Small-Cap Value Series | 1271983 | 16929389 | 17553371 | 17553371 | 3984018 | 2.27 | 13.09 |
| &nbsp;&nbsp;Virtus Newfleet Multi-Sector Intermediate Bond Series | 2361744 | 21951322 | 20523553 | 20523553 | 7483455 | 1.90 | 6.76 |
| &nbsp;&nbsp;Virtus SGA International Growth Series | 3373312 | 53774163 | 45033720 | 45033720 | 21980712 | 1.23 | 5.52 |
| &nbsp;&nbsp;Virtus VIT Tactical Allocation Series (a) | 601461 | 8403023 | 7145356 | 7145356 | 1234793 | 2.48 | 7.58 |

---

(a) Name change. See Note 2.

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account<br> Statements of Operations and Change in Net Assets<br> Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | AB VPS Balanced<br> Hedged Allocation<br> Portfolio | Alger Capital<br> Appreciation<br> Portfolio | Columbia Variable<br> Portfolio – Acorn<br> Fund (a) |
| Net assets as of December 31, 2023 | $3092969 | $3143822 | $26971998 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 23514 | - | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (32140) | (37568) | (316467) |
| Net investment income (loss) | (8626) | (37568) | (316467) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 27085 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (334780) | 868459 | 1275554 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 477262 | 356604 | 1885488 |
| Net gain (loss) on investments | 169567 | 1225063 | 3161042 |
| Net increase (decrease) in net assets from operations | 160941 | 1187495 | 2844575 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 2499 | 60820 | 186742 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (2022671) | (1873756) | (8552501) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (227) | (33025) | (655145) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (38402) | (1202) | 24583 |
| Increase (decrease) in net assets from contract transactions | (2058801) | (1847163) | (8996321) |
| Total increase (decrease) in net assets | (1897860) | (659668) | (6151746) |
| Net assets as of December 31, 2024 | $1195109 | $2484154 | $20820252 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 18837 | - | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (14322) | (28199) | (237021) |
| Net investment income (loss) | 4515 | (28199) | (237021) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 52210 | 382371 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (56548) | 551680 | (1506231) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 150175 | (276335) | 2200644 |
| Net gain (loss) on investments | 145837 | 657716 | 694413 |
| Net increase (decrease) in net assets from operations | 150352 | 629517 | 457392 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | (833) | 60 | 16096 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (138722) | (656652) | (3579976) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (160650) | (23722) | (76747) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (12181) | (764) | (13694) |
| Increase (decrease) in net assets from contract transactions | (312386) | (681078) | (3654321) |
| Total increase (decrease) in net assets | (162034) | (51561) | (3196929) |
| Net assets as of December 31, 2025 | $1033075 | $2432593 | $17623323 |

---

(a) Name change. See Note 2.

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Columbia Variable<br> Portfolio – Acorn<br> International<br> Fund (a) | CVT S&P MidCap<br> 400 Index<br> Portfolio (a) | DWS Equity 500<br> Index VIP |
| Net assets as of December 31, 2023 | $27886318 | $2028861 | $19290897 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 332248 | 14913 | 245011 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (314577) | (22267) | (224496) |
| Net investment income (loss) | 17671 | (7354) | 20515 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | - | 53744 | 1167199 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (430596) | 347724 | 3566389 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | (1644900) | (205023) | (976659) |
| Net gain (loss) on investments | (2075496) | 196445 | 3756929 |
| Net increase (decrease) in net assets from operations | (2057825) | 189091 | 3777444 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 29453 | 8691 | 633 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (7783394) | (624621) | (6940843) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 827674 | (22509) | (634018) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (37106) | (771) | (30784) |
| Increase (decrease) in net assets from contract transactions | (6963373) | (639210) | (7605012) |
| Total increase (decrease) in net assets | (9021198) | (450119) | (3827568) |
| Net assets as of December 31, 2024 | $18865120 | $1578742 | $15463329 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 238557 | 13102 | 165563 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (251703) | (15827) | (190228) |
| Net investment income (loss) | (13146) | (2725) | (24665) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 95686 | 78876 | 1369790 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (412950) | 82075 | 1127101 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 2458784 | (114456) | (158819) |
| Net gain (loss) on investments | 2141520 | 46495 | 2338072 |
| Net increase (decrease) in net assets from operations | 2128374 | 43770 | 2313407 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 28095 | 15177 | 37178 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (3498152) | (479938) | (3243576) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 416278 | (230633) | 26792 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (50051) | (739) | (4660) |
| Increase (decrease) in net assets from contract transactions | (3103830) | (696133) | (3184266) |
| Total increase (decrease) in net assets | (975456) | (652363) | (870859) |
| Net assets as of December 31, 2025 | $17889664 | $926379 | $14592470 |

---

(a) Name change. See Note 2.

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | DWS Small Cap<br> Index VIP | Federated Hermes<br> Fund for U.S.<br> Government<br> Securities II | Federated Hermes<br> Government<br> Money Fund II |
| Net assets as of December 31, 2023 | $573857 | $23205671 | $15761447 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 6780 | 780094 | 636851 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (6365) | (253198) | (182780) |
| Net investment income (loss) | 415 | 526896 | 454071 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 15892 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 22864 | (1374684) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 6883 | 711279 | - |
| Net gain (loss) on investments | 45639 | (663405) | - |
| Net increase (decrease) in net assets from operations | 46054 | (136509) | 454071 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | - | 6526 | 6384 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (112431) | (6756005) | (5956863) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 13713 | 1074901 | 1465330 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (388) | (64144) | (72694) |
| Increase (decrease) in net assets from contract transactions | (99106) | (5738722) | (4557843) |
| Total increase (decrease) in net assets | (53052) | (5875231) | (4103772) |
| Net assets as of December 31, 2024 | $520805 | $17330440 | $11657675 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 5737 | 680408 | 406499 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (4979) | (206333) | (144216) |
| Net investment income (loss) | 758 | 474075 | 262283 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 24499 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 1470 | (562525) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 8203 | 972938 | - |
| Net gain (loss) on investments | 34172 | 410413 | - |
| Net increase (decrease) in net assets from operations | 34930 | 884488 | 262283 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | - | 48961 | 15805 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (99856) | (3165977) | (2554538) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (89135) | 447682 | 1231850 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (348) | (41164) | (39739) |
| Increase (decrease) in net assets from contract transactions | (189339) | (2710498) | (1346622) |
| Total increase (decrease) in net assets | (154409) | (1826010) | (1084339) |
| Net assets as of December 31, 2025 | $366396 | $15504430 | $10573336 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Federated Hermes<br> High Income Bond<br> Fund II | Fidelity® VIP<br> Contrafund®<br> Portfolio | Fidelity® VIP<br> Growth<br> Opportunities<br> Portfolio |
| Net assets as of December 31, 2023 | $3348334 | $20774249 | $48421248 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 184317 | 18373 | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (39919) | (275346) | (604648) |
| Net investment income (loss) | 144398 | (256973) | (604648) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | - | 2170883 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (269214) | 4702350 | 15647154 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 262314 | (538359) | (402987) |
| Net gain (loss) on investments | (6900) | 6334874 | 15244167 |
| Net increase (decrease) in net assets from operations | 137498 | 6077901 | 14639519 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 2604 | 110926 | 45814 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (1000284) | (7885907) | (16780810) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 22719 | (200266) | (5960082) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (5001) | (23855) | (282856) |
| Increase (decrease) in net assets from contract transactions | (979962) | (7999102) | (22977934) |
| Total increase (decrease) in net assets | (842464) | (1921201) | (8338415) |
| Net assets as of December 31, 2024 | $2505870 | $18853048 | $40082833 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 143574 | 7910 | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (29649) | (221710) | (492904) |
| Net investment income (loss) | 113925 | (213800) | (492904) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | - | 2628460 | 584512 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (227413) | 1825924 | 7158866 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 256336 | (1148523) | (227611) |
| Net gain (loss) on investments | 28923 | 3305861 | 7515767 |
| Net increase (decrease) in net assets from operations | 142848 | 3092061 | 7022863 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 31123 | 10181 | 18954 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (589449) | (4409504) | (6757993) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (92489) | (868296) | (2664701) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (4070) | (7754) | (154836) |
| Increase (decrease) in net assets from contract transactions | (654885) | (5275373) | (9558576) |
| Total increase (decrease) in net assets | (512037) | (2183312) | (2535713) |
| Net assets as of December 31, 2025 | $1993833 | $16669736 | $37547120 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Fidelity® VIP<br> Growth Portfolio | Fidelity® VIP<br> Investment Grade<br> Bond Portfolio | Franklin Income<br> VIP Fund |
| Net assets as of December 31, 2023 | $11606220 | $15689933 | $9737962 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | - | 428733 | 482811 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (150182) | (186210) | (126202) |
| Net investment income (loss) | (150182) | 242523 | 356609 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 2259772 | - | 39557 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 2356884 | (373253) | (283019) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | (1415894) | 200068 | 393586 |
| Net gain (loss) on investments | 3200762 | (173185) | 150124 |
| Net increase (decrease) in net assets from operations | 3050580 | 69338 | 506733 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 91393 | 15466 | 179258 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (3911372) | (5158909) | (2839107) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (508810) | 1389390 | 78603 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (5956) | (122393) | (95325) |
| Increase (decrease) in net assets from contract transactions | (4334745) | (3876446) | (2676571) |
| Total increase (decrease) in net assets | (1284165) | (3807108) | (2169838) |
| Net assets as of December 31, 2024 | $10322055 | $11882825 | $7568124 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 18436 | 397068 | 369250 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (123217) | (154835) | (100867) |
| Net investment income (loss) | (104781) | 242233 | 268383 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 1188692 | - | 77615 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 158942 | (80135) | (189337) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | (63852) | 507831 | 585318 |
| Net gain (loss) on investments | 1283782 | 427696 | 473596 |
| Net increase (decrease) in net assets from operations | 1179001 | 669929 | 741979 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 28458 | 9864 | (169379) |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (1885415) | (2188096) | (1613293) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (136177) | 909960 | 190331 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (54999) | (77107) | (74729) |
| Increase (decrease) in net assets from contract transactions | (2048133) | (1345379) | (1667070) |
| Total increase (decrease) in net assets | (869132) | (675450) | (925091) |
| Net assets as of December 31, 2025 | $9452923 | $11207375 | $6643033 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Franklin Mutual<br> Shares VIP Fund | FTVIP Franklin<br> DynaTech Fund | Invesco V.I.<br> American<br> Franchise Fund |
| Net assets as of December 31, 2023 | $13015900 | $291773 | $11280038 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 210133 | - | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (164168) | (3139) | (136409) |
| Net investment income (loss) | 45965 | (3139) | (136409) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 218520 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 76676 | 27371 | 1772513 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 820378 | 40445 | 1537537 |
| Net gain (loss) on investments | 1115574 | 67816 | 3310050 |
| Net increase (decrease) in net assets from operations | 1161539 | 64677 | 3173641 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 242707 | 6968 | 7891 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (3694521) | (177398) | (3885899) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (329649) | (4394) | (1189070) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (94243) | (246) | (42055) |
| Increase (decrease) in net assets from contract transactions | (3875706) | (175070) | (5109133) |
| Total increase (decrease) in net assets | (2714167) | (110393) | (1935492) |
| Net assets as of December 31, 2024 | $10301733 | $181380 | $9344546 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 198387 | - | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (132107) | (2474) | (106670) |
| Net investment income (loss) | 66280 | (2474) | (106670) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 977455 | - | 750295 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 50373 | 4491 | 1069525 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | (182895) | 28003 | (865590) |
| Net gain (loss) on investments | 844933 | 32494 | 954230 |
| Net increase (decrease) in net assets from operations | 911213 | 30020 | 847560 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | (151677) | 1900 | 17481 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (2496758) | (7626) | (1892261) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 232399 | (1771) | (280861) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (75159) | (2749) | (19458) |
| Increase (decrease) in net assets from contract transactions | (2491195) | (10246) | (2175099) |
| Total increase (decrease) in net assets | (1579982) | 19774 | (1327539) |
| Net assets as of December 31, 2025 | $8721751 | $201154 | $8017007 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Invesco V.I. Core<br> Equity Fund | Invesco V.I.<br> Discovery Large<br> Cap Fund (a) | Invesco V.I. Equity<br> and Income Fund |
| Net assets as of December 31, 2023 | $2163433 | $797527 | $1470081 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 13311 | - | 18911 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (27435) | (9870) | (18392) |
| Net investment income (loss) | (14124) | (9870) | 519 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 159864 | - | 46194 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 158677 | 77640 | 40052 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 159099 | 157678 | 51045 |
| Net gain (loss) on investments | 477640 | 235318 | 137291 |
| Net increase (decrease) in net assets from operations | 463516 | 225448 | 137810 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 40626 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (605283) | (315872) | (480871) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (115739) | (18430) | 13836 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (9274) | (1129) | (3217) |
| Increase (decrease) in net assets from contract transactions | (689670) | (335431) | (470252) |
| Total increase (decrease) in net assets | (226154) | (109983) | (332442) |
| Net assets as of December 31, 2024 | $1937279 | $687544 | $1137639 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 11572 | - | 15723 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (23680) | (8486) | (13358) |
| Net investment income (loss) | (12108) | (8486) | 2365 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 133221 | 82048 | 45111 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 70464 | 32312 | 5962 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 65639 | (31390) | 41832 |
| Net gain (loss) on investments | 269324 | 82970 | 92905 |
| Net increase (decrease) in net assets from operations | 257216 | 74484 | 95270 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 32324 | 3025 | 14127 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (317556) | (93702) | (290844) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (72981) | (453) | (99142) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (4893) | 102 | (2380) |
| Increase (decrease) in net assets from contract transactions | (363106) | (91028) | (378239) |
| Total increase (decrease) in net assets | (105890) | (16544) | (282969) |
| Net assets as of December 31, 2025 | $1831389 | $671000 | $854670 |

---

(a) Name change. See Note 2.

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Invesco V.I. Global<br> Fund | Invesco V.I. Main<br> Street Mid Cap<br> Fund® | Invesco V.I. Main<br> Street Small Cap<br> Fund® |
| Net assets as of December 31, 2023 | $1073606 | $773139 | $14883579 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | - | 3429 | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (12760) | (10163) | (178211) |
| Net investment income (loss) | (12760) | (6734) | (178211) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 42860 | 24707 | 428279 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 95843 | 1039 | 1719351 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 17102 | 108559 | (596531) |
| Net gain (loss) on investments | 155805 | 134305 | 1551099 |
| Net increase (decrease) in net assets from operations | 143045 | 127571 | 1372888 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 8484 | - | 11245 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (524507) | (295944) | (4833599) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (19856) | (31864) | (153248) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (929) | (404) | (99796) |
| Increase (decrease) in net assets from contract transactions | (536808) | (328212) | (5075398) |
| Total increase (decrease) in net assets | (393763) | (200641) | (3702510) |
| Net assets as of December 31, 2024 | $679843 | $572498 | $11181069 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | - | 1714 | 22951 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (9083) | (9097) | (138192) |
| Net investment income (loss) | (9083) | (7383) | (115241) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 112425 | 50560 | 1020489 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 20440 | 37093 | 635218 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | (44226) | (5096) | (842161) |
| Net gain (loss) on investments | 88639 | 82557 | 813546 |
| Net increase (decrease) in net assets from operations | 79556 | 75174 | 698305 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 20161 | - | 2044 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (177351) | (353919) | (2115262) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (7969) | 248135 | 352924 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (906) | (121) | (59024) |
| Increase (decrease) in net assets from contract transactions | (166065) | (105905) | (1819318) |
| Total increase (decrease) in net assets | (86509) | (30731) | (1121013) |
| Net assets as of December 31, 2025 | $593334 | $541767 | $10060056 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Lazard Retirement<br> US Small Cap<br> Equity Select<br> Portfolio | Lord Abbett Series<br> Fund Bond<br> Debenture<br> Portfolio | Lord Abbett Series<br> Fund Growth and<br> Income Portfolio |
| Net assets as of December 31, 2023 | $420282 | $1973832 | $25035250 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | - | 76886 | 169644 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (5673) | (23350) | (297476) |
| Net investment income (loss) | (5673) | 53536 | (127832) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 15160 | - | 1473200 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (5305) | (41927) | 3089519 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 34872 | 76432 | (247800) |
| Net gain (loss) on investments | 44727 | 34505 | 4314919 |
| Net increase (decrease) in net assets from operations | 39054 | 88041 | 4187087 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | - | 100 | 16456 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (36970) | (696557) | (8058921) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (21) | 14570 | (1016767) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (437) | (1915) | (93686) |
| Increase (decrease) in net assets from contract transactions | (37428) | (683802) | (9152918) |
| Total increase (decrease) in net assets | 1626 | (595761) | (4965831) |
| Net assets as of December 31, 2024 | $421908 | $1378071 | $20069419 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | - | 80968 | 101295 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (5113) | (19368) | (242177) |
| Net investment income (loss) | (5113) | 61600 | (140882) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 50731 | - | 1911050 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (79089) | (9207) | 974376 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 36708 | 50812 | 50202 |
| Net gain (loss) on investments | 8350 | 41605 | 2935628 |
| Net increase (decrease) in net assets from operations | 3237 | 103205 | 2794746 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | - | 10834 | 22981 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (32971) | (369141) | (3550784) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (62830) | 265423 | (662740) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (273) | (1527) | (47209) |
| Increase (decrease) in net assets from contract transactions | (96074) | (94411) | (4237752) |
| Total increase (decrease) in net assets | (92837) | 8794 | (1443006) |
| Net assets as of December 31, 2025 | $329071 | $1386865 | $18626413 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Lord Abbett Series<br> Fund Mid Cap<br> Stock Portfolio | Morningstar<br> Aggressive Growth<br> ETF Asset<br> Allocation Portfolio | Morningstar<br> Balanced ETF<br> Asset Allocation<br> Portfolio |
| Net assets as of December 31, 2023 | $1686454 | $4152903 | $13434613 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 6599 | 31210 | 188360 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (22230) | (43591) | (171421) |
| Net investment income (loss) | (15631) | (12381) | 16939 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 148493 | 36148 | 100970 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 129860 | 784991 | 412726 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | (54199) | (349933) | 541377 |
| Net gain (loss) on investments | 224154 | 471206 | 1055073 |
| Net increase (decrease) in net assets from operations | 208523 | 458825 | 1072012 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 65804 | 4385 | 700 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (505535) | (2102908) | (3810553) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 33062 | (52049) | (371042) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (2114) | (16207) | (141387) |
| Increase (decrease) in net assets from contract transactions | (408783) | (2166779) | (4322282) |
| Total increase (decrease) in net assets | (200260) | (1707954) | (3250270) |
| Net assets as of December 31, 2024 | $1486194 | $2444949 | $10184343 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 4113 | 23400 | 203548 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (18000) | (31054) | (135310) |
| Net investment income (loss) | (13887) | (7654) | 68238 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 104704 | 148407 | 1151027 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 39292 | 267111 | 215480 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | (59397) | (4860) | (237400) |
| Net gain (loss) on investments | 84599 | 410658 | 1129107 |
| Net increase (decrease) in net assets from operations | 70712 | 403004 | 1197345 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 9285 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (224215) | (671316) | (1764621) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (61632) | 1811 | 1622537 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (3250) | (6460) | (123796) |
| Increase (decrease) in net assets from contract transactions | (279812) | (675965) | (265880) |
| Total increase (decrease) in net assets | (209100) | (272961) | 931465 |
| Net assets as of December 31, 2025 | $1277094 | $2171988 | $11115808 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Morningstar<br> Growth ETF Asset<br> Allocation Portfolio | Morningstar<br> Income and<br> Growth ETF Asset<br> Allocation Portfolio | Neuberger Berman<br> AMT Mid Cap<br> Growth Portfolio |
| Net assets as of December 31, 2023 | $6226113 | $13717458 | $384383 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 64405 | 191217 | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (74537) | (159297) | (6249) |
| Net investment income (loss) | (10132) | 31920 | (6249) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 88628 | 55446 | 27640 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 473284 | 7214 | 17967 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 66014 | 719810 | 51926 |
| Net gain (loss) on investments | 627926 | 782470 | 97533 |
| Net increase (decrease) in net assets from operations | 617794 | 814390 | 91284 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 371 | 671 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (2392816) | (5707450) | (112398) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 33650 | (113599) | 114264 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (40028) | (129472) | 264 |
| Increase (decrease) in net assets from contract transactions | (2398823) | (5949850) | 2130 |
| Total increase (decrease) in net assets | (1781029) | (5135460) | 93414 |
| Net assets as of December 31, 2024 | $4445084 | $8581998 | $477797 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 57363 | 168109 | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (58757) | (106006) | (9533) |
| Net investment income (loss) | (1394) | 62103 | (9533) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 288046 | 590544 | 99487 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 258705 | 12416 | (61445) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 105928 | 88358 | (80207) |
| Net gain (loss) on investments | 652679 | 691318 | (42165) |
| Net increase (decrease) in net assets from operations | 651285 | 753421 | (51698) |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 32000 | 2641 | 473537 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (965245) | (1517933) | (91257) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (2191) | (244951) | 79229 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (32812) | (84507) | (249978) |
| Increase (decrease) in net assets from contract transactions | (968248) | (1844750) | 211531 |
| Total increase (decrease) in net assets | (316963) | (1091329) | 159833 |
| Net assets as of December 31, 2025 | $4128121 | $7490669 | $637630 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Neuberger Berman<br> AMT Quality Equity<br> Portfolio (a) | PIMCO<br> CommodityReal<br> Return® Strategy<br> Portfolio | PIMCO Real<br> Return Portfolio |
| Net assets as of December 31, 2023 | $23449222 | $10344488 | $706825 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | - | 196649 | 16787 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (289860) | (130062) | (8102) |
| Net investment income (loss) | (289860) | 66587 | 8685 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 873811 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 3021685 | (879920) | (11346) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 1166462 | 1081856 | 8217 |
| Net gain (loss) on investments | 5061958 | 201936 | (3129) |
| Net increase (decrease) in net assets from operations | 4772098 | 268523 | 5556 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 17904 | 9489 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (7957637) | (3419371) | (138544) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (1968878) | 1401753 | 4674 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (165613) | (77564) | (482) |
| Increase (decrease) in net assets from contract transactions | (10074224) | (2085693) | (134352) |
| Total increase (decrease) in net assets | (5302126) | (1817170) | (128796) |
| Net assets as of December 31, 2024 | $18147096 | $8527318 | $578029 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | - | 229687 | 17529 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (223477) | (113057) | (6803) |
| Net investment income (loss) | (223477) | 116630 | 10726 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 952616 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 1249763 | (2618382) | (4907) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | (105240) | 3845728 | 28694 |
| Net gain (loss) on investments | 2097139 | 1227346 | 23787 |
| Net increase (decrease) in net assets from operations | 1873662 | 1343976 | 34513 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 6907 | 3251 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (3246168) | (1635366) | (78198) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (532564) | (110454) | 1501 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (95450) | (51449) | (230) |
| Increase (decrease) in net assets from contract transactions | (3867275) | (1794018) | (76927) |
| Total increase (decrease) in net assets | (1993613) | (450042) | (42414) |
| Net assets as of December 31, 2025 | $16153483 | $8077276 | $535615 |

---

(a) Name change. See Note 2.

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | PIMCO Total<br> Return Portfolio | Rydex VT Inverse<br> Government Long<br> Bond Strategy<br> Fund | Rydex VT Nova<br> Fund |
| Net assets as of December 31, 2023 | $2344741 | $82707 | $199521 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 75643 | 3090 | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (25919) | (1183) | (2675) |
| Net investment income (loss) | 49724 | 1907 | (2675) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (130411) | (51341) | 49611 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 95990 | 61130 | 7539 |
| Net gain (loss) on investments | (34421) | 9789 | 57150 |
| Net increase (decrease) in net assets from operations | 15303 | 11696 | 54475 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 690 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (732745) | (21417) | (72641) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 148379 | 5068 | (670) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (980) | (168) | (186) |
| Increase (decrease) in net assets from contract transactions | (584656) | (16517) | (73497) |
| Total increase (decrease) in net assets | (569353) | (4821) | (19022) |
| Net assets as of December 31, 2024 | $1775388 | $77886 | $180499 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 77861 | 5457 | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (24581) | (1155) | (2119) |
| Net investment income (loss) | 53280 | 4302 | (2119) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (16382) | 163 | 53343 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 109918 | (4198) | (21174) |
| Net gain (loss) on investments | 93536 | (4035) | 32169 |
| Net increase (decrease) in net assets from operations | 146816 | 267 | 30050 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 8141 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (548567) | (347) | (68929) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 326119 | 368 | (601) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (569) | (180) | (98) |
| Increase (decrease) in net assets from contract transactions | (214876) | (159) | (69628) |
| Total increase (decrease) in net assets | (68060) | 108 | (39578) |
| Net assets as of December 31, 2025 | $1707328 | $77994 | $140921 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Templeton<br> Developing<br> Markets VIP Fund | Templeton Foreign<br> VIP Fund | Templeton Growth<br> VIP Fund |
| Net assets as of December 31, 2023 | $1346651 | $3514784 | $11391264 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 49205 | 80174 | 98717 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (14757) | (41731) | (144927) |
| Net investment income (loss) | 34448 | 38443 | (46210) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 9456 | - | 33787 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (56899) | (46198) | (84271) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 84509 | (18479) | 588468 |
| Net gain (loss) on investments | 37066 | (64677) | 537984 |
| Net increase (decrease) in net assets from operations | 71514 | (26234) | 491774 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 875 | 117813 | 188443 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (466342) | (988398) | (3484991) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (28802) | 88596 | 114064 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (925) | (5773) | (80562) |
| Increase (decrease) in net assets from contract transactions | (495194) | (787762) | (3263046) |
| Total increase (decrease) in net assets | (423680) | (813996) | (2771272) |
| Net assets as of December 31, 2024 | $922971 | $2700788 | $8619992 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 5394 | 62307 | 73443 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (12391) | (34722) | (115787) |
| Net investment income (loss) | (6997) | 27585 | (42344) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 16833 | 173976 | 630519 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 65229 | 69206 | 74138 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 283978 | 380598 | 992677 |
| Net gain (loss) on investments | 366040 | 623780 | 1697334 |
| Net increase (decrease) in net assets from operations | 359043 | 651365 | 1654990 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 9066 | 10143 | (126955) |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (260247) | (629725) | (1824370) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (74315) | (108223) | (469329) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (589) | (2421) | (75396) |
| Increase (decrease) in net assets from contract transactions | (326085) | (730226) | (2496050) |
| Total increase (decrease) in net assets | 32958 | (78861) | (841060) |
| Net assets as of December 31, 2025 | $955929 | $2621927 | $7778932 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | TVST Touchstone<br> Balanced Fund | TVST Touchstone<br> Bond Fund | TVST Touchstone<br> Common Stock<br> Fund |
| Net assets as of December 31, 2023 | $1207540 | $11059936 | $47842898 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 11856 | 461509 | 229349 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (12406) | (134602) | (590056) |
| Net investment income (loss) | (550) | 326907 | (360707) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | - | - | 2548003 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 35457 | (292864) | 2832196 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 74774 | 67879 | 3065185 |
| Net gain (loss) on investments | 110231 | (224985) | 8445384 |
| Net increase (decrease) in net assets from operations | 109681 | 101922 | 8084677 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | - | 12523 | 90939 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (633904) | (3461502) | (15859022) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (9740) | 964442 | (2684012) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (1278) | (103616) | (388173) |
| Increase (decrease) in net assets from contract transactions | (644922) | (2588153) | (18840268) |
| Total increase (decrease) in net assets | (535241) | (2486231) | (10755591) |
| Net assets as of December 31, 2024 | $672299 | $8573705 | $37087307 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 10825 | 318370 | 172238 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (7503) | (111694) | (467251) |
| Net investment income (loss) | 3322 | 206676 | (295013) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 15321 | - | 4663984 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 28314 | (95674) | (28013) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 23883 | 395926 | 903324 |
| Net gain (loss) on investments | 67518 | 300252 | 5539295 |
| Net increase (decrease) in net assets from operations | 70840 | 506928 | 5244282 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 16024 | 7166 | 18081 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (173555) | (1419393) | (6891419) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (1653) | 287926 | (1509732) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (3392) | (66780) | (235177) |
| Increase (decrease) in net assets from contract transactions | (162576) | (1191081) | (8618247) |
| Total increase (decrease) in net assets | (91736) | (684153) | (3373965) |
| Net assets as of December 31, 2025 | $580563 | $7889552 | $33713342 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | TVST Touchstone<br> Small Company<br> Fund | Virtus Duff &<br> Phelps Real Estate<br> Securities Series | Virtus KAR Capital<br> Growth Series |
| Net assets as of December 31, 2023 | $7451202 | $21939135 | $31223199 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 24281 | 320860 | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (90781) | (257048) | (407173) |
| Net investment income (loss) | (66500) | 63812 | (407173) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 192068 | 187167 | 3963966 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 324287 | (751594) | 2817193 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 320430 | 2275344 | 590894 |
| Net gain (loss) on investments | 836785 | 1710917 | 7372053 |
| Net increase (decrease) in net assets from operations | 770285 | 1774729 | 6964880 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 16373 | 19333 | 303118 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (2416104) | (7446887) | (9090265) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 3429 | 377908 | (494137) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (51562) | (60776) | (13235) |
| Increase (decrease) in net assets from contract transactions | (2447864) | (7110422) | (9294519) |
| Total increase (decrease) in net assets | (1677579) | (5335693) | (2329639) |
| Net assets as of December 31, 2024 | $5773623 | $16603442 | $28893560 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 9998 | 379076 | - |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (69043) | (196152) | (346615) |
| Net investment income (loss) | (59045) | 182924 | (346615) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 650884 | 66878 | 2881371 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 112228 | (429729) | 933455 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | (320652) | 91559 | (1981300) |
| Net gain (loss) on investments | 442460 | (271292) | 1833526 |
| Net increase (decrease) in net assets from operations | 383415 | (88368) | 1486911 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 2225 | 19688 | 39486 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (1257455) | (2934253) | (4140707) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 87761 | 243001 | (873695) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (31548) | (57856) | (16390) |
| Increase (decrease) in net assets from contract transactions | (1199017) | (2729420) | (4991306) |
| Total increase (decrease) in net assets | (815602) | (2817788) | (3504395) |
| Net assets as of December 31, 2025 | $4958021 | $13785654 | $25389165 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Virtus KAR<br> Enhanced Core<br> Equity Series | Virtus KAR Small-<br> Cap Growth Series | Virtus KAR Small-<br> Cap Value Series |
| Net assets as of December 31, 2023 | $27666129 | $24017550 | $31059975 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 662963 | - | 126384 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (349848) | (262501) | (349910) |
| Net investment income (loss) | 313115 | (262501) | (223526) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 11336 | 1464680 | 1837784 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 402523 | 1025890 | 1146819 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 1328596 | (791204) | (830983) |
| Net gain (loss) on investments | 1742455 | 1699366 | 2153620 |
| Net increase (decrease) in net assets from operations | 2055570 | 1436865 | 1930094 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 174162 | 103231 | 32428 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (8359070) | (7423242) | (10567682) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (115569) | (235194) | (133285) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | 124081 | (22537) | (125534) |
| Increase (decrease) in net assets from contract transactions | (8176396) | (7577742) | (10794073) |
| Total increase (decrease) in net assets | (6120826) | (6140877) | (8863979) |
| Net assets as of December 31, 2024 | $21545303 | $17876673 | $22195996 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 374682 | - | 56540 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (286192) | (179294) | (255685) |
| Net investment income (loss) | 88490 | (179294) | (199145) |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | 1187703 | 3057744 | 1890842 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | 315206 | (97047) | 112616 |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 834583 | (6587414) | (2964950) |
| Net gain (loss) on investments | 2337492 | (3626717) | (961492) |
| Net increase (decrease) in net assets from operations | 2425982 | (3806011) | (1160637) |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 165880 | 10043 | 30568 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (4481434) | (2614487) | (4272595) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | (390965) | 15375 | 825627 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | 89298 | (12935) | (65588) |
| Increase (decrease) in net assets from contract transactions | (4617221) | (2602004) | (3481988) |
| Total increase (decrease) in net assets | (2191239) | (6408015) | (4642625) |
| Net assets as of December 31, 2025 | $19354064 | $11468658 | $17553371 |

---

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account

Statements of Operations and Change in Net Assets (continued)

Years Ended December 31, 2025 and 2024

---

| | | | |
|:---|:---|:---|:---|
|  | Virtus Newfleet<br> Multi-Sector<br> Intermediate Bond<br> Series | Virtus SGA<br> International<br> Growth Series | Virtus VIT Tactical<br> Allocation<br> Series (a) |
| Net assets as of December 31, 2023 | $31116377 | $69505236 | $10532271 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 1332061 | 130946 | 183917 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (372293) | (776661) | (128879) |
| Net investment income (loss) | 959768 | (645715) | 55038 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | - | 112611 | 821848 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (360447) | (5559566) | (50834) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 647258 | 1975916 | 373929 |
| Net gain (loss) on investments | 286811 | (3471039) | 1144943 |
| Net increase (decrease) in net assets from operations | 1246579 | (4116754) | 1199981 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 374973 | 40718 | 143748 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (10101196) | (21345811) | (2771674) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 1101187 | 4870334 | (147867) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (175682) | (363402) | (4411) |
| Increase (decrease) in net assets from contract transactions | (8800718) | (16798161) | (2780204) |
| Total increase (decrease) in net assets | (7554139) | (20914915) | (1580223) |
| Net assets as of December 31, 2024 | $23562238 | $48590321 | $8952048 |
| Investment income (loss): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend distributions | 1083527 | 80152 | 151318 |
| Investment Expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Mortality and expense risk and administrative charges | (295244) | (627634) | (101972) |
| Net investment income (loss) | 788283 | (547482) | 49346 |
| Increase (decrease) in net assets from operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital gain distributions | - | 1461410 | 882002 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized capital gain (loss) on investments | (103857) | (1748983) | (97828) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unrealized appreciation (depreciation) | 656897 | 4578892 | (369617) |
| Net gain (loss) on investments | 553040 | 4291319 | 414557 |
| Net increase (decrease) in net assets from operations | 1341323 | 3743837 | 463903 |
| Contract owner transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits | 43012 | 51835 | 10187 |
| &nbsp;&nbsp;&nbsp;&nbsp;Terminations, withdrawals and annuity payments | (4488561) | (9326658) | (2008747) |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfers between subaccounts, net | 176293 | 2187364 | (268666) |
| &nbsp;&nbsp;&nbsp;&nbsp;Maintenance charges and mortality adjustments | (110752) | (212979) | (3369) |
| Increase (decrease) in net assets from contract transactions | (4380008) | (7300438) | (2270595) |
| Total increase (decrease) in net assets | (3038685) | (3556601) | (1806692) |
| Net assets as of December 31, 2025 | $20523553 | $45033720 | $7145356 |

---

(a) Name change. See Note 2.

The accompanying notes are an integral part of these financial statements.

PHL Variable Accumulation Account<br> Notes to Financial Statements<br> December 31, 2025

**Note 1. Organization**

The PHL Variable Accumulation Account (the "Separate Account"), is a separate account of PHL Variable Insurance Company ("PHL", "PHL Variable", the Company, "we" or "us"). PHL is a wholly-owned subsidiary of PHL Delaware, LLC ("PHL Delaware" or the "Parent"). PHL is a provider of life insurance and annuity products. In November 2019, PHL stopped marketing and selling new business.

PHL Variable Insurance Company ("PHL") and its subsidiaries, Concord Re, Inc. and Palisado Re, Inc. (collectively, the "PHL Companies") entered rehabilitation proceedings in the Connecticut Superior Court (the "Court") on May 20, 2024, as a result of the PHL Companies' hazardous financial condition. Rehabilitation is a court proceeding that the insurance commissioner of a company's state of domicile may initiate to take control of the company if it is in a hazardous financial condition.

The Court appointed the Connecticut Insurance Commissioner as the PHL Companies' Rehabilitator. The Rehabilitator assumed control of the PHL Companies' assets and has continued to administer them under the Court's supervision. The Rehabilitator is also empowered to take the necessary or appropriate actions approved by the Court to rehabilitate the PHL Companies. On December 31, 2025, the Rehabilitator filed a report with the Court stating that he has determined that a rehabilitation plan, as originally contemplated, is not feasible and that a liquidation order will be required. The Rehabilitator expects that a liquidation order will be entered by late 2026 or early 2027, but it may be earlier or later. Until that time, the Rehabilitator will continue to administer PHL's business under the existing Rehabilitation Order.

On June 25, 2024, the Court approved on a final basis a moratorium order that limits payments under some policies and annuities. The moratorium allows the PHL Companies to mitigate the high outflow of claim payments and is anticipated to be in place in some form until the liquidation order is entered by the Court. Although the payments have been limited under the moratorium, the PHL Companies have continued to record liabilities for the full amount of policyholder benefits.

While the Separate Account remains insulated from PHL's general account, the Separate Account only supports the value of investments in variable investment options and does not support financial guarantees from PHL's general account. During rehabilitation, financial guarantees from PHL's general account arising from contracts in the Separate Account will continue to be subject to the moratorium. In liquidation, state guaranty associations will continue coverage and benefits due from PHL Variable's general account subject to applicable statutory limits and conditions.The Separate Account is registered as a unit investment trust under the Investment Company Act of 1940, as amended and was established on December 7, 1994. As directed by the owners, amounts directed to each subaccount are invested in a designated mutual fund as follows:

---

| | |
|:---|:---|
| **Subaccount** | **Share Class** |
| AB VPS Balanced Hedged Allocation Portfolio | Class B |
| Alger Capital Appreciation Portfolio | Class I-2 |
| Columbia Variable Portfolio – Acorn Fund |  |
| Columbia Variable Portfolio – Acorn International Fund |  |
| CVT S&P MidCap 400 Index Portfolio | Class I |
| DWS Equity 500 Index VIP | Class A |
| DWS Small Cap Index VIP | Class A |
| Federated Hermes Fund for U.S. Government Securities II | Primary |
| Federated Hermes Government Money Fund II | Service |
| Federated Hermes High Income Bond Fund II | Primary |
| Fidelity® VIP Contrafund® Portfolio | Service Class |
| Fidelity® VIP Growth Opportunities Portfolio | Service Class |
| Fidelity® VIP Growth Portfolio | Service Class |

---

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 1. Organization (continued)**

---

| | |
|:---|:---|
| **Subaccount** | **Share Class** |
| Fidelity® VIP Investment Grade Bond Portfolio | Service Class |
| Franklin Income VIP Fund | Class 2 |
| Franklin Mutual Shares VIP Fund | Class 2 |
| FTVIP Franklin DynaTech Fund | Class 2 |
| Invesco V.I. American Franchise Fund | Series I |
| Invesco V.I. Core Equity Fund | Series I |
| Invesco V.I. Discovery Large Cap Fund | Series II |
| Invesco V.I. Equity and Income Fund | Series II |
| Invesco V.I. Global Fund | Series II |
| Invesco V.I. Main Street Mid Cap Fund® | Series I |
| Invesco V.I. Main Street Small Cap Fund® | Series II |
| Lazard Retirement US Small Cap Equity Select Portfolio | Service |
| Lord Abbett Series Fund Bond Debenture Portfolio | Class VC |
| Lord Abbett Series Fund Growth and Income Portfolio | Class VC |
| Lord Abbett Series Fund Mid Cap Stock Portfolio | Class VC |
| Morningstar Aggressive Growth ETF Asset Allocation Portfolio | Class II |
| Morningstar Balanced ETF Asset Allocation Portfolio | Class II |
| Morningstar Growth ETF Asset Allocation Portfolio | Class II |
| Morningstar Income and Growth ETF Asset Allocation Portfolio | Class II |
| Neuberger Berman AMT Mid Cap Growth Portfolio | S Class |
| Neuberger Berman AMT Quality Equity Portfolio | Class S |
| PIMCO CommodityReal Return® Strategy Portfolio | Advisor Class |
| PIMCO Real Return Portfolio | Advisor Class |
| PIMCO Total Return Portfolio | Advisor Class |
| Rydex VT Inverse Government Long Bond Strategy Fund |  |
| Rydex VT Nova Fund |  |
| Templeton Developing Markets VIP Fund | Class 2 |
| Templeton Foreign VIP Fund | Class 2 |
| Templeton Growth VIP Fund | Class 2 |
| TVST Touchstone Balanced Fund |  |
| TVST Touchstone Bond Fund |  |
| TVST Touchstone Common Stock Fund |  |
| TVST Touchstone Small Company Fund |  |
| Virtus Duff & Phelps Real Estate Securities Series | Class A |
| Virtus KAR Capital Growth Series | Class A |
| Virtus KAR Enhanced Core Equity Series | Class A |
| Virtus KAR Small-Cap Growth Series | Class A |
| Virtus KAR Small-Cap Value Series | Class A |
| Virtus Newfleet Multi-Sector Intermediate Bond Series | Class A |
| Virtus SGA International Growth Series | Class A |
| Virtus VIT Tactical Allocation Series | Class A |

---

Fifty-four subaccounts are currently offered by the Separate Account, all of which had activity.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 1. Organization (continued)**

Additionally, contract owners may direct the allocation of their premium payments and contract value between the Separate Account, the Guaranteed Interest Account ("GIA") and/or the Market Value Adjusted Guaranteed Interest Account ("MVA"). The MVA was closed to new investment effective May 1, 2013.

PHL Variable and the Separate Account are subject to regulation by the State of Connecticut Department of Insurance and the U.S. Securities and Exchange Commission ("SEC"). The assets and liabilities of the Separate Account are clearly identified and distinguished from PHL Variable's other asset and liabilities. Premium payments and contract value allocated by a contract owner to the GIA are not legally insulated and are subject to claims against PHL Variable's general account assets.

**Note 2. Additions, Mergers, Liquidations and Name Changes**

A. Additions

There were no fund additions in 2024 or 2025.

B. Mergers

There were no fund mergers in 2024 or 2025.

C. Liquidations

During the last two years the following subaccount was liquidated and subsequently reinvested:

---

| | | | |
|:---|:---|:---|:---|
| <br>**Date** | <br>**Liquidated Subaccount** | <br>**Reinvested Subaccount** | **Transferred**<br>**Assets ($)** |
| August 16, 2024 | Guggenheim VIF Long Short Equity | Federated Hermes Government Money |  |

---

D. Name Changes

During the last two years the following subaccount name changes were made effective:

---

| | | |
|:---|:---|:---|
| **Date** | **New Name** | **Old Name** |
| April 29, 2024 | Virtus VIT Tactical Allocation Series | Virtus VIT Strategic Allocation Series |
| May 1, 2024 | CVT S&P MidCap 400 Index Portfolio | Calvert VP S&P MidCap 400 Index Portfolio |
| May 1, 2025 | Invesco V.I. Discovery Large Cap Fund | Invesco V.I. Capital Appreciation Fund |
| June 2, 2025 | Columbia Variable Portfolio – Acorn Fund | Wanger Acorn |
| June 2, 2025 | Columbia Variable Portfolio – Acorn International Fund | Wanger International |
| July 28, 2025 | Neuberger Berman AMT Quality Equity Portfolio | Neuberger AMT Sustainable Equity |

---

**Note 3. Significant Accounting Policies**

**Investment Valuation**

Investments in mutual fund shares are carried in the statements of net assets at market value (net asset value of the underlying mutual fund). Investment transactions are accounted for on the trade date. Realized capital gains and losses on sales of investments are determined based on the average cost of investments sold. The difference between cost and current market value of investments owned on the day of measurement is recorded as unrealized appreciation or depreciation of investments.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 3. Significant Accounting Policies (continued)**

**Market Risk**

Each subaccount invests in shares of a single underlying fund. The investment performance of each subaccount will reflect the investment performance of the underlying fund less separate account expenses. There is no assurance that the investment objective of any underlying fund will be met. A fund calculates a daily net asset value per share ("NAV") which is based on the market value of its investment portfolio. The amount of risk varies significantly between subaccounts. Due to the level of risk associated with certain investment portfolios, it is at least reasonably possible that changes in the values of investment portfolios will occur in the near term and that such changes could materially affect contract holder's investments in the funds and the amounts reported in the statements of net assets. The contract holder assumes all of the investment performance risk for the subaccounts selected.

**Contracts in Payout (Annuitization) Period**

Net assets allocated to contracts in the payout period are computed according to the Annuity 2000 Mortality Table, or 2012 Individual Annuity Reserving Mortality Table depending on the particular product. The assumed interest return is also dependent on the particular product, and could range from 4.5 percent to 5.25 percent, as regulated by the laws of the respective states. During the payout period, the mortality risk is fully borne by PHL and may result in additional amounts being transferred into the Separate Account from PHL to cover greater longevity of annuitants than expected. Conversely, if amounts allocated during the payout period exceed amounts required, transfers of excess amounts from the Separate Account may be made to PHL. These amounts will appear in the "Maintenance charges and mortality adjustments" of the Statements of Operations and Change in Net Assets.

**Annuity Assets**

Annuity Assets relate to contracts that have annuitized and are in the payout period. Such assets are computed on the basis of published mortality tables using assumed interest rates that will provide assets as prescribed by law. In cases where the payout option selected is life contingent, PHL periodically recalculates the required annuity assets, and any resulting adjustment is either charged or credited to PHL and not to the Separate Account.

The annuity assets for December 31, 2025 by subaccount are as follows:

---

| | |
|:---|:---|
| **Subaccount** | **Annuity Assets** |
| AB VPS Balanced Hedged Allocation Portfolio | $519 |
| Columbia Variable Portfolio – Acorn Fund | 2150 |
| Columbia Variable Portfolio – Acorn International Fund | 3581 |
| CVT S&P MidCap 400 Index Portfolio | 70 |
| DWS Equity 500 Index VIP | 7818 |
| DWS Small Cap Index VIP | 14 |
| Federated Hermes Fund for U.S. Government Securities II | 6754 |
| Federated Hermes Government Money Fund II | 2472 |
| Federated Hermes High Income Bond Fund II | 278 |
| Fidelity® VIP Contrafund® Portfolio | 6006 |
| Fidelity® VIP Growth Opportunities Portfolio | 11132 |
| Fidelity® VIP Growth Portfolio | 6222 |
| Fidelity® VIP Investment Grade Bond Portfolio | 2654 |
| Franklin Income VIP Fund | 1465 |
| Franklin Mutual Shares VIP Fund | 2691 |
| Invesco V.I. American Franchise Fund | 4273 |
| Invesco V.I. Core Equity Fund | 474 |
| Invesco V.I. Discovery Large Cap Fund | 1979 |
| Invesco V.I. Global Fund | 142 |

---

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 3. Significant Accounting Policies (continued)**

---

| | |
|:---|:---|
| **Subaccount** | **Annuity Assets** |
| Invesco V.I. Main Street Mid Cap Fund® | $447 |
| Invesco V.I. Main Street Small Cap Fund® | 2629 |
| Lazard Retirement US Small Cap Equity Select Portfolio | 125 |
| Lord Abbett Series Fund Bond Debenture Portfolio | 183 |
| Lord Abbett Series Fund Growth and Income Portfolio | 8231 |
| Lord Abbett Series Fund Mid Cap Stock Portfolio | 1652 |
| Morningstar Balanced ETF Asset Allocation Portfolio | 1517 |
| Morningstar Growth ETF Asset Allocation Portfolio | 976 |
| Morningstar Income and Growth ETF Asset Allocation Portfolio | 118 |
| Neuberger Berman AMT Mid Cap Growth Portfolio | 3845 |
| Neuberger Berman AMT Quality Equity Portfolio | 5277 |
| PIMCO CommodityReal Return® Strategy Portfolio | 1931 |
| PIMCO Real Return Portfolio | 11 |
| PIMCO Total Return Portfolio | 139 |
| Templeton Developing Markets VIP Fund | 204 |
| Templeton Foreign VIP Fund | 345 |
| Templeton Growth VIP Fund | 1494 |
| TVST Touchstone Balanced Fund | 8 |
| TVST Touchstone Bond Fund | 1951 |
| TVST Touchstone Common Stock Fund | 12320 |
| TVST Touchstone Small Company Fund | 1291 |
| Virtus Duff & Phelps Real Estate Securities Series | 3433 |
| Virtus KAR Capital Growth Series | 7989 |
| Virtus KAR Enhanced Core Equity Series | 101930 |
| Virtus KAR Small-Cap Growth Series | 2259 |
| Virtus KAR Small-Cap Value Series | 3770 |
| Virtus Newfleet Multi-Sector Intermediate Bond Series | 11915 |
| Virtus SGA International Growth Series | 11670 |
| Virtus VIT Tactical Allocation Series | 1881 |

---

**Reinvestment of Dividends**

Dividend and capital gain distributions paid by the mutual funds to the Separate Account are reinvested in additional shares of each respective fund. Dividend income and capital gain distributions are recorded as income on the ex-dividend date.

**Federal Income Taxes**

The operations of the Separate Account are included in the federal income tax return of PHL, which is taxed as a life insurance company under the provisions of the Internal Revenue Code (IRC). Under the current provisions of the IRC, PHL does not expect to incur federal income taxes on the earnings of the Separate Account to the extent the earnings are credited under contracts. Based on this, no charge is being made currently to the Separate Account for federal income taxes. PHL will review periodically the status of this policy in the event of changes in the tax law.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 3. Significant Accounting Policies (continued)**

**Use of Estimates**

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

In applying these estimates and assumptions, management makes subjective and complex judgments that frequently require assumptions about matters that are uncertain and inherently subject to change such as possibility for elevated mortality and investment market volatility.

**Fair Value Measurements**

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price).

The Separate Account invests in shares of open-end mutual funds, which process contract holders directed purchases, sales and transfers on a daily basis at the funds' computed net asset values (NAVs). The fair value of the Separate Account's assets is based on the NAVs of mutual funds, which are obtained from the custodians and reflect the fair values of the mutual fund investments. The NAV is calculated daily and is based on the fair values of the underlying securities.

Because the fund provides liquidity for the investments through purchases and redemptions at NAV, this may represent the fair value of the investment in the fund. That is, for an open-ended mutual fund, the fair value of an investment in the fund would not be expected to be higher than the amount that a new investor would be required to spend in order to directly invest in the mutual fund. Similarly, the hypothetical seller of the investment would not be expected to accept less in proceeds than it could receive by directly redeeming its investment with the fund.

The Separate Account measures the fair value of its investment in the Fund on a recurring basis. GAAP establishes a hierarchy that prioritizes inputs to valuation methods. The three levels of inputs are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the Separate Account has the ability to access.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● Level 2 – Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument in an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates, and similar data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● Level 3 – Unobservable inputs for the asset or liability, to the extent observable inputs are not available, representing the Separate Account's own assumptions about the assumptions a market participant would use in valuing the assets or liability, and would be based on the best information available.

Investments in Fund shares are valued using the reported net asset value of the respective Funds at the end of each New York Stock Exchange business day, as determined by the respective Funds. Investments held by the Separate Account are Level 1 within the hierarchy. There were no transfers between Level 1, Level 2 and Level 3 during the year ended December 31, 2025.

The Separate Account had no financial liabilities as of December 31, 2025.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 3. Significant Accounting Policies (continued)**

**Segment Disclosures**

An operating segment is defined in Topic 280 as a component of a public entity that engages in business activities from which it may recognize revenues and incur expenses, has operating results that are regularly reviewed by the public entity's chief operating decision maker ("CODM") to make decisions about resources to be allocated to the segment and assess its performance, and has discrete financial information available. The CODM is the 2VP Finance, Accounting Operations Department, who is responsible for reviewing subaccount financial statements and related Separate Account controls. The Separate Account represents a single operating segment, as the CODM monitors the operating results of the Fund as a whole and the Fund's long-term strategic asset allocation is pre-determined in accordance with the terms of its prospectus, based on the investment selections of its contract holders. The financial information which is used by the CODM to assess the segment's performance and to make resource allocation decisions for the Fund's single segment, is consistent with that presented within the Fund's financial statements. Segment assets are reported on the Statements of Operations and Change in Net Assets as net assets and significant segment expenses are reported in the Statements of Operations and Change in Net Assets. The CODM does not evaluate the business using asset or subaccount expense information.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 4. Purchases and Proceeds from Sales of Investments**

The cost of investment purchases and proceeds from investments sold for the years ended December 31, 2025 and 2024, were as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **2025** | **2025** | **2024** | **2024** |
| <br>**Subaccount** | **Cost of Purchases** | **Proceeds from<br> Sales** | **Cost of Purchases** | **Proceeds from<br> Sales** |
| AB VPS Balanced Hedged Allocation Portfolio | $71154 | $326815 | $54761 | $2095104 |
| Alger Capital Appreciation Portfolio | 387989 | 714894 | 63293 | 1948023 |
| Columbia Variable Portfolio – Acorn Fund (a) | 275724 | 4167066 | 262473 | 9575261 |
| Columbia Variable Portfolio – Acorn International Fund (a) | 919998 | 3941289 | 1066631 | 8012334 |
| CVT S&P MidCap 400 Index Portfolio (a) | 111241 | 731223 | 498256 | 1091076 |
| DWS Equity 500 Index VIP | 2078937 | 3918078 | 1685578 | 8102876 |
| DWS Small Cap Index VIP | 31994 | 196076 | 209027 | 291827 |
| Federated Hermes Fund for U.S. Government Securities II | 1142726 | 3379149 | 1657876 | 6869702 |
| Federated Hermes Government Money Fund II | 2031475 | 3115813 | 2580418 | 6684190 |
| Federated Hermes High Income Bond Fund II | 216981 | 757941 | 216208 | 1051772 |
| Fidelity® VIP Contrafund® Portfolio | 2812692 | 5673405 | 3019626 | 9104819 |
| Fidelity® VIP Growth Opportunities Portfolio | 711483 | 10178451 | 627339 | 24209921 |
| Fidelity® VIP Growth Portfolio | 1289794 | 2254016 | 2457026 | 4682181 |
| Fidelity® VIP Investment Grade Bond Portfolio | 1139457 | 2242605 | 1544197 | 5178119 |
| Franklin Income VIP Fund | 914703 | 2235776 | 1259389 | 3539794 |
| Franklin Mutual Shares VIP Fund | 1749934 | 3197394 | 1425273 | 5036494 |
| FTVIP Franklin DynaTech Fund | 4101 | 16820 | 7693 | 185902 |
| Invesco V.I. American Franchise Fund | 843992 | 2375464 | 76557 | 5322100 |
| Invesco V.I. Core Equity Fund | 194849 | 436843 | 211898 | 755828 |
| Invesco V.I. Discovery Large Cap Fund (a) | 87147 | 104614 | 5705 | 351005 |
| Invesco V.I. Equity and Income Fund | 76209 | 406973 | 79670 | 503210 |
| Invesco V.I. Global Fund | 134140 | 196864 | 89318 | 596026 |
| Invesco V.I. Main Street Mid Cap Fund® | 311467 | 374196 | 466857 | 777096 |
| Invesco V.I. Main Street Small Cap Fund® | 1300216 | 2214285 | 761952 | 5587283 |
| Lazard Retirement US Small Cap Equity Select Portfolio | 65730 | 116186 | 17525 | 45466 |
| Lord Abbett Series Fund Bond Debenture Portfolio | 359590 | 392401 | 171933 | 802200 |
| Lord Abbett Series Fund Growth and Income Portfolio | 2064948 | 4532532 | 1750991 | 9558541 |
| Lord Abbett Series Fund Mid Cap Stock Portfolio | 137810 | 326804 | 296709 | 572630 |

---

(a) Name change. See Note 2.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 4. Purchases and Proceeds from Sales of Investments (continued)**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **2025** | **2025** | **2024** | **2024** |
| <br>**Subaccount** | **Cost of Purchases** | **Proceeds from<br> Sales** | **Cost of Purchases** | **Proceeds from<br> Sales** |
| Morningstar Aggressive Growth ETF Asset Allocation Portfolio | $171982 | $707194 | $71846 | $2214859 |
| Morningstar Balanced ETF Asset Allocation Portfolio | 3009205 | 2055820 | 842722 | 5047094 |
| Morningstar Growth ETF Asset Allocation Portfolio | 378706 | 1060303 | 193125 | 2513453 |
| Morningstar Income and Growth ETF Asset Allocation Portfolio | 838071 | 2030173 | 257617 | 6120101 |
| Neuberger Berman AMT Mid Cap Growth Portfolio | 1027522 | 726037 | 145286 | 121765 |
| Neuberger Berman AMT Quality Equity Portfolio (a) | 985653 | 4123789 | 943794 | 10434067 |
| PIMCO CommodityReal Return® Strategy Portfolio | 306421 | 1983809 | 1120402 | 3139508 |
| PIMCO Real Return Portfolio | 19754 | 85955 | 23175 | 148842 |
| PIMCO Total Return Portfolio | 518769 | 680366 | 331221 | 866153 |
| Rydex VT Inverse Government Long Bond Strategy Fund | 7294 | 3150 | 8256 | 22867 |
| Rydex VT Nova Fund | 11 | 71757 | 18 | 76189 |
| Templeton Developing Markets VIP Fund | 36411 | 352659 | 151834 | 603124 |
| Templeton Foreign VIP Fund | 259450 | 788116 | 325791 | 1075109 |
| Templeton Growth VIP Fund | 936037 | 2843912 | 984935 | 4260405 |
| TVST Touchstone Balanced Fund | 44463 | 188396 | 43781 | 689254 |
| TVST Touchstone Bond Fund | 546542 | 1530946 | 1081822 | 3343069 |
| TVST Touchstone Common Stock Fund | 4902956 | 9152232 | 2984876 | 19637847 |
| TVST Touchstone Small Company Fund | 708767 | 1315945 | 304616 | 2626912 |
| Virtus Duff & Phelps Real Estate Securities Series | 767282 | 3246900 | 1066213 | 7925657 |
| Virtus KAR Capital Growth Series | 3428645 | 5885195 | 4555650 | 10293376 |
| Virtus KAR Enhanced Core Equity Series | 2115350 | 5456377 | 1467795 | 9319740 |
| Virtus KAR Small-Cap Growth Series | 3399852 | 3123406 | 1830337 | 8205900 |
| Virtus KAR Small-Cap Value Series | 2510660 | 4300951 | 2319520 | 11499335 |
| Virtus Newfleet Multi-Sector Intermediate Bond Series | 1460357 | 5052082 | 2620514 | 10461463 |
| Virtus SGA International Growth Series | 2860329 | 9246839 | 2824338 | 20155602 |
| Virtus VIT Tactical Allocation Series (a) | 1059294 | 2398541 | 1194951 | 3098270 |

---

(a) Name change. See Note 2.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 5. Related Party Transactions and Charges and Deductions**

**Related Party Transactions**

PHL Variable and its affiliate, 1851 Securities, Inc. ("1851 Securities"), provide services to the Separate Account. PHL Variable is the insurer who provides the contract benefits. PHL Variable and its affiliate, The Nassau Companies of New York, provide administrative and contract maintenance services to the Separate Account. 1851 Securities, a registered broker/dealer, is the principal underwriter and distributor for the Separate Account.

**Charges and Deductions**

PHL Variable makes deductions from the contract to compensate for the various expenses in selling, maintaining, underwriting, and issuing the contracts and providing guaranteed insurance benefits.

Certain charges are deducted from the contracts as a daily reduction in Unit Value. The charges are included in a separate line item entitled "Mortality and expense risk and administrative charges" in the accompanying Statements of Operations and Change in Net Assets. Other periodic charges are taken out as a transaction on a monthly basis. Those charges appear on the Statements of Operations and Change in Net Assets on line "Maintenance charges and mortality adjustments". The contract charges are described below:

A. Contract Maintenance Charges

The Separate Account is assessed periodic Contract Maintenance Charges which are designed to compensate PHL Variable for certain costs associated with maintenance. The charges assessed to the Separate Account for Contract Maintenance Charges are outlined as follows:

Administration Charge – In accordance with terms of the contracts, PHL Variable makes deductions for administrative charges at the rates below. These charges are typically a flat dollar amount but could also be waived if the account value is above a certain dollar amount.

---

| | |
|:---|:---|
| &nbsp;&nbsp;**Plan** | &nbsp;&nbsp;**Admin Charge** |
| &nbsp;&nbsp;Asset Manager |  |
| &nbsp;&nbsp;Big Edge Choice | &nbsp;&nbsp;$35 |
| &nbsp;&nbsp;Freedom Edge | &nbsp;&nbsp;$35 |
| &nbsp;&nbsp;Phoenix Dimensions | &nbsp;&nbsp;$35 |
| &nbsp;&nbsp;Phoenix Income Choice | &nbsp;&nbsp;$24 |
| &nbsp;&nbsp;Phoenix Investor's Edge | &nbsp;&nbsp;$35 |
| &nbsp;&nbsp;Phoenix Premium Edge | &nbsp;&nbsp;$35 |
| &nbsp;&nbsp;Phoenix Spectrum Edge | &nbsp;&nbsp;$35 |
| &nbsp;&nbsp;Phoenix Spectrum Edge Plus | &nbsp;&nbsp;$35 |
| &nbsp;&nbsp;Retirement Planner's Edge | &nbsp;&nbsp;$35 |
| &nbsp;&nbsp;The Phoenix Edge VA | &nbsp;&nbsp;$35 |

---

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 5. Related Party Transactions and Charges and Deductions**

Contract Surrender Charge – In accordance with terms of the contracts, PHL Variable charges a deduction for surrender charges at the rates and schedules below. Because a contract's value and policy duration may vary, the surrender charge may also vary.

---

| | |
|:---|:---|
| **Plan** | **Surrender Charge** |
| &nbsp;&nbsp;Asset Manager |  |
| &nbsp;&nbsp;Big Edge Choice | Years 1-7: 7% 6% 5% 4% 3% 2% 1%; Years 8+: 0% |
| &nbsp;&nbsp;Freedom Edge |  |
| &nbsp;&nbsp;Phoenix Dimensions | 5 year schedule: Years 1-5: 7% 6% 5% 4% 3%; Years 6+: 0% |
|  | 7 year schedule: Years 1-7: 7% 6% 5% 4% 3% 2% 1%; Years 8+: 0% |
| &nbsp;&nbsp;Phoenix Income Choice | Years 1-7: 7% 6% 5% 4% 3% 2% 1%; Years 8+: 0% |
| &nbsp;&nbsp;Phoenix Investor's Edge | Years 1-4: 8% 7% 7% 6%; Years 5+: 0% |
| &nbsp;&nbsp;Phoenix Premium Edge | Years 1-8: 8% 8% 8% 7% 6% 5% 4% 3%; Years 9+: 0% |
| &nbsp;&nbsp;Phoenix Spectrum Edge | Years 1-7: 7% 6% 5% 4% 3% 2% 1%; Years 8+: 0% |
| &nbsp;&nbsp;Phoenix Spectrum Edge Plus | Years 1-7: 7% 6% 5% 4% 3% 2% 1%; Years 8+: 0% |
| &nbsp;&nbsp;Retirement Planner's Edge |  |
| &nbsp;&nbsp;The Phoenix Edge VA | Years 1-7: 7% 7% 6% 6% 5% 4% 3%; Years 8+: 0% |

---

All of the above expenses are reflected as redemption of units and are included in a separate line item entitled "Maintenance charges and mortality adjustments" in the accompanying Statements of Operations and Change in Net Assets.

B. Optional Rider and Benefit Charges

PHL may deduct other charges and fees based on the selection of Other Optional Contract Riders and Benefits. These expenses are included in a separate line item entitled "Terminations, withdrawals and annuity payments" in the accompanying Statements of Operations and Change in Net Assets. This expense is reflected as redemption of units.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 5. Related Party Transactions and Charges and Deductions**

C. Daily M&E and Administrative Fees

As mentioned above, the M&E Fees are typically deducted daily from policy value allocated to the variable subaccounts. These expenses are included in a separate line item "Mortality and expense risk and administrative charges" in the accompanying Statements of Operations and Change in Net Assets. This expense is reflected as a daily reduction of unit values. PHL will make deductions at the rates listed below of the contract's value for the mortality and expense cost risks and for administrative cost risks, which PHL Variable undertakes.

---

| | | |
|:---|:---|:---|
|  | &nbsp;&nbsp;**Annual M&E Factor** | &nbsp;&nbsp;**Annual M&E Factor** |
| &nbsp;&nbsp;**Plan** | &nbsp;&nbsp;**Assessed Daily** | &nbsp;&nbsp;**Assessed Monthly** |
| &nbsp;&nbsp;Asset Manager Option 1 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;0.375% |
| &nbsp;&nbsp;Asset Manager Option 2 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;0.625% |
| &nbsp;&nbsp;Freedom Edge | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.475% |
| &nbsp;&nbsp;Phoenix Dimensions Option 1 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.125% |
| &nbsp;&nbsp;Phoenix Dimensions Option 2 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.375% |
| &nbsp;&nbsp;Phoenix Dimensions Option 3 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.375% |
| &nbsp;&nbsp;Phoenix Dimensions Option 4 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.625% |
| &nbsp;&nbsp;Phoenix Income Choice | &nbsp;&nbsp;0.000% | &nbsp;&nbsp;1.250% |
| &nbsp;&nbsp;Phoenix Income Choice with GPAF | &nbsp;&nbsp;0.000% | &nbsp;&nbsp;2.250% |
| &nbsp;&nbsp;Phoenix Investor's Edge Option 1 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.525% |
| &nbsp;&nbsp;Phoenix Investor's Edge Option 2 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.675% |
| &nbsp;&nbsp;Phoenix Investor's Edge Option 3 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.825% |
| &nbsp;&nbsp;Phoenix Investor's Edge Option 4 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.725% |
| &nbsp;&nbsp;Phoenix Premium Edge | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.475% |
| &nbsp;&nbsp;Phoenix Spectrum Edge Option 1 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;0.975% |
| &nbsp;&nbsp;Phoenix Spectrum Edge Option 2 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.125% |
| &nbsp;&nbsp;Phoenix Spectrum Edge Option 3 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.275% |
| &nbsp;&nbsp;Phoenix Spectrum Edge Option 4 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.175% |
| &nbsp;&nbsp;Phoenix Spectrum Edge Plus Option 1 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.075% |
| &nbsp;&nbsp;Phoenix Spectrum Edge Plus Option 2 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.225% |
| &nbsp;&nbsp;Retirement Planner's Edge | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.275% |
| &nbsp;&nbsp;The Big Edge Choice | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.250% |
| &nbsp;&nbsp;The Phoenix Edge VA Option 1 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;0.775% |
| &nbsp;&nbsp;The Phoenix Edge VA Option 2 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.125% |
| &nbsp;&nbsp;The Phoenix Edge VA Option 3 | &nbsp;&nbsp;0.125% | &nbsp;&nbsp;1.225% |

---

D. Other Charges

PHL may deduct other charges depending on the contract terms.

Certain liabilities of the Separate Account are payable to PHL Variable when these fees are not settled at the end of the period and will be shown in the liability section of the Statements of Net Assets.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 6. Summary of Unit Transactions**

The changes in units outstanding for the periods December 31, 2025 and 2024, were as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **2025** | **2025** | **2025** | **2024** | **2024** | **2024** |
| <br>**Subaccount** | **Units<br> Issued** | **Units<br> Redeemed** | **Net<br> Increase<br> (Decrease)** | **Units<br> Issued** | **Units<br> Redeemed** | **Net<br> Increase<br> (Decrease)** |
| AB VPS Balanced Hedged Allocation Portfolio | 62 | (169628) | (169566) | 2212 | (1168862) | (1166650) |
| Alger Capital Appreciation Portfolio | 300 | (51787) | (51487) | 8370 | (169549) | (161179) |
| Columbia Variable Portfolio – Acorn Fund (a) | 30412 | (377858) | (347446) | 28805 | (928113) | (899308) |
| Columbia Variable Portfolio – Acorn International Fund (a) | 186177 | (937669) | (751492) | 298887 | (2022391) | (1723504) |
| CVT S&P MidCap 400 Index Portfolio (a) | 5707 | (177869) | (172162) | 102215 | (278631) | (176416) |
| DWS Equity 500 Index VIP | 48457 | (303770) | (255313) | 26473 | (768667) | (742194) |
| DWS Small Cap Index VIP | 614 | (57567) | (56953) | 55925 | (90021) | (34096) |
| Federated Hermes Fund for U.S. Government Securities II | 188486 | (1186394) | (997908) | 376172 | (2580061) | (2203889) |
| Federated Hermes Government Money Fund II | 1711846 | (3138436) | (1426590) | 2140530 | (7077979) | (4937449) |
| Federated Hermes High Income Bond Fund II | 12491 | (131651) | (119160) | 6939 | (220637) | (213698) |
| Fidelity® VIP Contrafund® Portfolio | 10320 | (364612) | (354292) | 70581 | (729594) | (659013) |
| Fidelity® VIP Growth Opportunities Portfolio | 12781 | (887607) | (874826) | 55228 | (2648357) | (2593129) |
| Fidelity® VIP Growth Portfolio | 7349 | (178064) | (170715) | 22438 | (432181) | (409743) |
| Fidelity® VIP Investment Grade Bond Portfolio | 536546 | (1453814) | (917268) | 835973 | (3619308) | (2783335) |
| Franklin Income VIP Fund | 227323 | (1028654) | (801331) | 382563 | (1719145) | (1336582) |
| Franklin Mutual Shares VIP Fund | 192224 | (958659) | (766435) | 378064 | (1713198) | (1335134) |
| FTVIP Franklin DynaTech Fund | 978 | (3000) | (2022) | 1837 | (44836) | (42999) |
| Invesco V.I. American Franchise Fund | 23797 | (456738) | (432941) | 19251 | (1203533) | (1184282) |
| Invesco V.I. Core Equity Fund | 14327 | (110064) | (95737) | 12338 | (218266) | (205928) |
| Invesco V.I. Discovery Large Cap Fund (a) | 1469 | (21171) | (19702) | 1461 | (85658) | (84197) |
| Invesco V.I. Equity and Income Fund | 6340 | (140803) | (134463) | 5606 | (185610) | (180004) |
| Invesco V.I. Global Fund | 8062 | (61206) | (53144) | 15429 | (194613) | (179184) |
| Invesco V.I. Main Street Mid Cap Fund® | 78116 | (99717) | (21601) | 132154 | (229800) | (97646) |
| Invesco V.I. Main Street Small Cap Fund® | 85549 | (643429) | (557880) | 106008 | (1764856) | (1658848) |

---

(a) Name change. See Note 2.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 6. Summary of Unit Transactions (continued)**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **2025** | **2025** | **2025** | **2024** | **2024** | **2024** |
| <br>**Subaccount** | **Units<br> Issued** | **Units<br> Redeemed** | **Net<br> Increase<br> (Decrease)** | **Units<br> Issued** | **Units<br> Redeemed** | **Net<br> Increase<br> (Decrease)** |
| Lazard Retirement US Small Cap Equity Select Portfolio | 5044 | (35833) | (30789) | 823 | (13096) | (12273) |
| Lord Abbett Series Fund Bond Debenture Portfolio | 126579 | (165797) | (39218) | 46484 | (375243) | (328759) |
| Lord Abbett Series Fund Growth and Income Portfolio | 19354 | (1253122) | (1233768) | 38183 | (3067784) | (3029601) |
| Lord Abbett Series Fund Mid Cap Stock Portfolio | 10980 | (110336) | (99356) | 55382 | (205503) | (150121) |
| Morningstar Aggressive Growth ETF Asset Allocation Portfolio | 73 | (242163) | (242090) | 2136 | (891779) | (889643) |
| Morningstar Balanced ETF Asset Allocation Portfolio | 806406 | (1013129) | (206723) | 319101 | (2719468) | (2400367) |
| Morningstar Growth ETF Asset Allocation Portfolio | 13831 | (413705) | (399874) | 16987 | (1126894) | (1109907) |
| Morningstar Income and Growth ETF Asset Allocation Portfolio | 48125 | (1227053) | (1178928) | 7628 | (3987762) | (3980134) |
| Neuberger Berman AMT Mid Cap Growth Portfolio | 399957 | (339540) | 60417 | 58923 | (55817) | 3106 |
| Neuberger Berman AMT Quality Equity Portfolio (a) | 18750 | (1941043) | (1922293) | 41365 | (5682548) | (5641183) |
| PIMCO CommodityReal Return® Strategy Portfolio | 114551 | (2384398) | (2269847) | 1373726 | (4280899) | (2907173) |
| PIMCO Real Return Portfolio | 1537 | (52106) | (50569) | 4341 | (96460) | (92119) |
| PIMCO Total Return Portfolio | 267846 | (393481) | (125635) | 158165 | (564877) | (406712) |
| Rydex VT Inverse Government Long Bond Strategy Fund | 6013 | (6378) | (365) | 18520 | (77314) | (58794) |
| Rydex VT Nova Fund | 2 | (6498) | (6496) |  | (9742) | (9742) |
| Templeton Developing Markets VIP Fund | 9179 | (98348) | (89169) | 17585 | (279776) | (262191) |
| Templeton Foreign VIP Fund | 7311 | (199967) | (192656) | 78189 | (342962) | (264773) |
| Templeton Growth VIP Fund | 102409 | (1291553) | (1189144) | 495517 | (1969134) | (1473617) |
| TVST Touchstone Balanced Fund | 7283 | (64841) | (57558) | 12704 | (258785) | (246081) |
| TVST Touchstone Bond Fund | 182004 | (1036624) | (854620) | 502990 | (2424753) | (1921763) |
| TVST Touchstone Common Stock Fund | 16323 | (1847785) | (1831462) | 52681 | (4642202) | (4589521) |

---

(a) Name change. See Note 2.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 6. Summary of Unit Transactions (continued)**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **2025** | **2025** | **2025** | **2024** | **2024** | **2024** |
| <br>**Subaccount** | **Units**<br>**Issued** | **Units**<br>**Redeemed** | **Net<br> Increase**<br>**(Decrease)** | **Units**<br>**Issued** | **Units**<br>**Redeemed** | **Net<br> Increase**<br>**(Decrease)** |
| TVST Touchstone Small Company Fund | 15452 | (336457) | (321005) | 28607 | (726828) | (698221) |
| Virtus Duff & Phelps Real Estate Securities Series | 90997 | (721257) | (630260) | 185024 | (1724002) | (1538978) |
| Virtus KAR Capital Growth Series | 98484 | (929225) | (830741) | 123147 | (1905718) | (1782571) |
| Virtus KAR Enhanced Core Equity Series | 134365 | (962592) | (828227) | 251548 | (1911032) | (1659484) |
| Virtus KAR Small-Cap Growth Series | 20031 | (180982) | (160951) | 21674 | (403652) | (381978) |
| Virtus KAR Small-Cap Value Series | 141110 | (807643) | (666533) | 63616 | (2234381) | (2170765) |
| Virtus Newfleet Multi-Sector Intermediate Bond Series | 113762 | (1561302) | (1447540) | 496502 | (3719024) | (3222522) |
| Virtus SGA International Growth Series | 813581 | (4210588) | (3397007) | 1466394 | (9387618) | (7921224) |
| Virtus VIT Tactical Allocation Series (a) | 4490 | (411999) | (407509) | 40796 | (564144) | (523348) |

---

(a) Name change. See Note 2.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 7. Financial Highlights**

The Separate Account has a number of products, which have unique combinations of features and fees that are charged against the contract owner's subaccount balance. Differences in the fee structures result in a variety of unit values, expense ratios, and total returns. The information presented below identifies the range of lowest to highest expense ratios and the corresponding unit values and total returns. The summary may not reflect the minimum and maximum contract charges offered by the Separate Account as contract owners may not have selected all available and applicable contract options as discussed in Note 5.

A summary of units outstanding, unit values, net assets, investment income ratios, expense ratios and total return ratios for each of the five years in the period ended December 31, 2025, were as follows:

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| AB VPS Balanced Hedged Allocation Portfolio | AB VPS Balanced Hedged Allocation Portfolio |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 479258 | 2.01 | 2.26 | 1033075 | 1.83 | 1.10 | 1.75 | 14.86 | 16.13 |
| &nbsp;&nbsp;&nbsp;2024 | 648824 | 1.73 | 2.02 | 1195109 | 1.10 | 0.90 | 1.80 | 6.55 | 7.45 |
| &nbsp;&nbsp;&nbsp;2023 | 1815475 | 1.62 | 1.88 | 3092969 | 0.89 | 0.90 | 1.80 | 10.20 | 11.90 |
| &nbsp;&nbsp;&nbsp;2022 | 2215299 | 1.47 | 1.68 | 3401165 | 2.99 | 0.90 | 1.80 | (20.54) | (20.00) |
| &nbsp;&nbsp;&nbsp;2021 | 2588635 | 1.85 | 2.10 | 4996572 | 0.25 | 0.90 | 1.80 | 11.33 | 12.35 |
| Alger Capital Appreciation Portfolio |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 134030 | 14.55 | 26.72 | 2432593 |  | 0.90 | 1.95 | 30.31 | 31.73 |
| &nbsp;&nbsp;&nbsp;2024 | 185517 | 11.13 | 20.33 | 2484154 |  | 0.90 | 1.95 | 45.25 | 46.79 |
| &nbsp;&nbsp;&nbsp;2023 | 346697 | 11.47 | 9.04 | 3143822 |  | 0.90 | 1.95 | 40.39 | 41.92 |
| &nbsp;&nbsp;&nbsp;2022 | 406109 | 8.17 | 6.37 | 2594234 |  | 0.90 | 1.95 | (37.78) | (37.12) |
| &nbsp;&nbsp;&nbsp;2021 | 443863 | 13.13 | 10.13 | 4484300 |  | 0.90 | 1.95 | 16.81 | 18.05 |
| Columbia Variable Portfolio – Acorn Fund (a) | Columbia Variable Portfolio – Acorn Fund (a) |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 1523859 | 2.93 | 13.05 | 17623323 |  | 0.90 | 1.80 | 2.67 | 3.57 |
| &nbsp;&nbsp;&nbsp;2024 | 1871305 | 2.84 | 12.60 | 20820252 |  | 0.90 | 1.95 | 12.00 | 13.11 |
| &nbsp;&nbsp;&nbsp;2023 | 2770613 | 8.08 | 11.14 | 26971998 |  | 0.90 | 1.95 | 19.35 | 20.69 |
| &nbsp;&nbsp;&nbsp;2022 | 2609710 | 6.77 | 9.23 | 21409246 |  | 0.90 | 1.95 | (34.78) | (34.07) |
| &nbsp;&nbsp;&nbsp;2021 | 2803906 | 10.38 | 14.00 | 35088271 | 0.73 | 0.90 | 1.95 | 6.78 | 7.92 |

---

(a) Name change. See Note 2.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| Columbia Variable Portfolio – Acorn International Fund (a) | Columbia Variable Portfolio – Acorn International Fund (a) | Columbia Variable Portfolio – Acorn International Fund (a) |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 4596839 | 1.53 | 9.55 | 17889664 | 1.24 | 0.90 | 1.80 | 10.73 | 11.68 |
| &nbsp;&nbsp;&nbsp;2024 | 5348331 | 1.37 | 8.56 | 18865120 | 1.39 | 0.90 | 1.95 | (10.03) | (9.03) |
| &nbsp;&nbsp;&nbsp;2023 | 7071834 | 7.80 | 8.57 | 27886318 | 0.31 | 0.90 | 1.95 | 14.71 | 15.97 |
| &nbsp;&nbsp;&nbsp;2022 | 7716386 | 6.80 | 7.39 | 26346385 | 0.91 | 0.90 | 1.95 | (35.11) | (34.43) |
| &nbsp;&nbsp;&nbsp;2021 | 7570718 | 10.48 | 11.27 | 41070177 | 0.55 | 0.90 | 1.95 | 16.50 | 17.74 |
| CVT S&P MidCap 400 Index Portfolio (a) |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 223462 | 3.71 | 4.48 | 926379 | 1.06 | 0.90 | 1.95 | 5.10 | 6.16 |
| &nbsp;&nbsp;&nbsp;2024 | 395624 | 3.53 | 4.22 | 1578742 | 0.84 | 0.90 | 1.95 | 11.28 | 12.53 |
| &nbsp;&nbsp;&nbsp;2023 | 572040 | 3.17 | 3.75 | 2028861 | 1.24 | 0.90 | 1.95 | 13.62 | 15.03 |
| &nbsp;&nbsp;&nbsp;2022 | 579956 | 2.79 | 3.26 | 1793233 | 0.93 | 0.90 | 1.95 | (14.94) | (14.21) |
| &nbsp;&nbsp;&nbsp;2021 | 690132 | 3.28 | 3.80 | 2500866 | 0.80 | 0.90 | 1.95 | 21.99 | 23.30 |
| DWS Equity 500 Index VIP |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 1160903 | 4.77 | 15.14 | 14592470 | 1.09 | 0.90 | 1.95 | 15.26 | 16.55 |
| &nbsp;&nbsp;&nbsp;2024 | 1416216 | 4.11 | 12.99 | 15463329 | 1.38 | 0.90 | 1.95 | 22.17 | 23.60 |
| &nbsp;&nbsp;&nbsp;2023 | 2158410 | 7.94 | 10.51 | 19290897 | 1.40 | 0.90 | 1.95 | 23.68 | 24.82 |
| &nbsp;&nbsp;&nbsp;2022 | 2395976 | 6.42 | 8.42 | 17241498 | 1.26 | 0.90 | 1.95 | (19.95) | (19.04) |
| &nbsp;&nbsp;&nbsp;2021 | 2596231 | 8.02 | 10.40 | 23120364 | 1.47 | 0.90 | 1.95 | 25.90 | 27.24 |
| DWS Small Cap Index VIP |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 102809 | 3.31 | 3.79 | 366396 | 1.38 | 0.90 | 1.65 | 10.60 | 11.59 |
| &nbsp;&nbsp;&nbsp;2024 | 159762 | 2.99 | 3.40 | 520805 | 1.24 | 0.90 | 1.65 | 9.12 | 10.39 |
| &nbsp;&nbsp;&nbsp;2023 | 193857 | 2.74 | 3.08 | 573857 | 1.09 | 0.90 | 1.65 | 15.13 | 15.36 |
| &nbsp;&nbsp;&nbsp;2022 | 189668 | 2.38 | 2.67 | 485875 | 0.82 | 0.90 | 1.65 | (21.97) | (21.24) |
| &nbsp;&nbsp;&nbsp;2021 | 133648 | 3.05 | 3.39 | 428382 | 0.85 | 0.90 | 1.65 | 12.62 | 13.47 |

---

(a) Name change. See Note 2.

PHL Variable Accumulation Account<br> Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| Federated Hermes Fund for U.S. Government Securities II | Federated Hermes Fund for U.S. Government Securities II | Federated Hermes Fund for U.S. Government Securities II |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 5709912 | 1.11 | 3.57 | 15504430 | 4.12 | 0.90 | 1.95 | 4.50 | 5.98 |
| &nbsp;&nbsp;&nbsp;2024 | 6707820 | 1.06 | 3.37 | 17330440 | 3.89 | 0.90 | 1.95 | (1.77) | (0.30) |
| &nbsp;&nbsp;&nbsp;2023 | 8911710 | 2.25 | 3.38 | 23205671 | 2.58 | 0.90 | 1.95 | 2.27 | 3.05 |
| &nbsp;&nbsp;&nbsp;2022 | 9801258 | 2.20 | 3.28 | 24831476 | 1.92 | 0.90 | 1.95 | (14.40) | (13.23) |
| &nbsp;&nbsp;&nbsp;2021 | 11073290 | 2.57 | 3.78 | 32251266 | 2.04 | 0.90 | 1.95 | (3.95) | (2.93) |
| Federated Hermes Government Money Fund II | Federated Hermes Government Money Fund II |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 10952113 | 0.83 | 1.03 | 10573336 | 3.67 | 0.90 | 2.25 | 2.08 | 3.23 |
| &nbsp;&nbsp;&nbsp;2024 | 12378703 | 0.87 | 1.00 | 11657675 | 4.60 | 0.90 | 1.85 | 2.25 | 4.35 |
| &nbsp;&nbsp;&nbsp;2023 | 17316152 | 0.84 | 0.96 | 15761447 | 4.44 | 0.90 | 1.85 | 2.44 | 3.23 |
| &nbsp;&nbsp;&nbsp;2022 | 19524099 | 0.78 | 0.93 | 17220899 | 1.11 | 0.90 | 2.25 | (1.27) |  |
| &nbsp;&nbsp;&nbsp;2021‡ | 21952157 | 0.79 | 0.93 | 19402387 | 0.00 | 0.90 | 2.25 | (2.25) | (0.90) |
| Federated Hermes High Income Bond Fund II | Federated Hermes High Income Bond Fund II |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 384346 | 2.21 | 7.10 | 1993833 | 6.49 | 0.90 | 1.95 | 6.22 | 7.30 |
| &nbsp;&nbsp;&nbsp;2024 | 503506 | 2.07 | 6.63 | 2505870 | 6.21 | 0.90 | 1.95 | 4.19 | 5.23 |
| &nbsp;&nbsp;&nbsp;2023 | 717203 | 5.21 | 6.12 | 3348334 | 5.99 | 0.90 | 1.95 | 10.38 | 11.88 |
| &nbsp;&nbsp;&nbsp;2022 | 803646 | 4.72 | 5.47 | 3425667 | 5.76 | 0.90 | 1.95 | (13.39) | (12.62) |
| &nbsp;&nbsp;&nbsp;2021‡ | 942182 | 5.45 | 6.26 | 4602978 | 4.94 | 0.90 | 1.95 | 2.81 | 3.91 |
| Fidelity® VIP Contrafund® Portfolio |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 1140167 | 5.52 | 21.09 | 16669736 | 0.05 | 0.90 | 1.95 | 19.03 | 20.26 |
| &nbsp;&nbsp;&nbsp;2024 | 1494459 | 4.61 | 17.57 | 18853048 | 0.09 | 0.90 | 1.95 | 31.03 | 32.40 |
| &nbsp;&nbsp;&nbsp;2023 | 2153472 | 10.99 | 11.11 | 20774249 | 0.38 | 0.90 | 1.95 | 30.68 | 32.10 |
| &nbsp;&nbsp;&nbsp;2022 | 2511686 | 8.41 | 8.41 | 18280250 | 0.39 | 0.90 | 1.95 | (27.81) | (27.00) |
| &nbsp;&nbsp;&nbsp;2021 | 2778139 | 11.65 | 11.52 | 27766702 | 0.05 | 0.90 | 1.95 | 25.22 | 26.56 |
| Fidelity® VIP Growth Opportunities Portfolio | Fidelity® VIP Growth Opportunities Portfolio |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 2889731 | 8.45 | 23.42 | 37547120 |  | 0.90 | 1.80 | 19.64 | 20.70 |
| &nbsp;&nbsp;&nbsp;2024 | 3764557 | 7.03 | 19.44 | 40082833 |  | 0.90 | 1.80 | 36.25 | 37.59 |
| &nbsp;&nbsp;&nbsp;2023 | 6357685 | 11.71 | 10.64 | 48421248 |  | 0.90 | 1.95 | 42.63 | 44.17 |
| &nbsp;&nbsp;&nbsp;2022 | 7225009 | 8.21 | 7.38 | 38385323 |  | 0.90 | 1.95 | (39.36) | (38.76) |
| &nbsp;&nbsp;&nbsp;2021 | 7064560 | 13.54 | 12.05 | 62241084 |  | 0.90 | 1.95 | 9.65 | 10.82 |

---

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| Fidelity® VIP Growth Portfolio |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 744600 | 7.00 | 16.41 | 9452923 | 0.19 | 0.90 | 1.95 | 12.49 | 13.80 |
| &nbsp;&nbsp;&nbsp;2024 | 915315 | 6.18 | 14.46 | 10322055 |  | 0.90 | 1.95 | 27.69 | 29.02 |
| &nbsp;&nbsp;&nbsp;2023 | 1325059 | 9.28 | 8.03 | 11606220 | 0.04 | 0.90 | 1.95 | 33.53 | 34.96 |
| &nbsp;&nbsp;&nbsp;2022 | 1535651 | 6.95 | 5.95 | 10113473 | 0.51 | 0.90 | 1.95 | (25.99) | (25.25) |
| &nbsp;&nbsp;&nbsp;2021‡ | 1653976 | 9.39 | 7.96 | 14591626 |  | 0.90 | 1.95 | 20.69 | 21.98 |
| Fidelity® VIP Investment Grade Bond Portfolio | Fidelity® VIP Investment Grade Bond Portfolio |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 7632000 | 1.35 | 1.60 | 11207375 | 3.37 | 0.90 | 1.80 | 5.04 | 5.96 |
| &nbsp;&nbsp;&nbsp;2024 | 8549268 | 1.28 | 1.51 | 11882825 | 3.06 | 0.90 | 1.80 | (0.77) | 0.72 |
| &nbsp;&nbsp;&nbsp;2023 | 11332603 | 1.28 | 1.50 | 15689933 | 2.52 | 0.90 | 1.80 | 4.07 | 4.90 |
| &nbsp;&nbsp;&nbsp;2022 | 12411708 | 1.20 | 1.43 | 16407356 | 2.12 | 0.90 | 1.95 | (14.89) | (13.33) |
| &nbsp;&nbsp;&nbsp;2021 | 13866208 | 1.41 | 1.65 | 21337464 | 1.95 | 0.90 | 1.95 | (2.66) | (1.62) |
| Franklin Income VIP Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 2982915 | 2.08 | 2.70 | 6643033 | 5.20 | 0.90 | 1.80 | 10.64 | 11.59 |
| &nbsp;&nbsp;&nbsp;2024 | 3784246 | 1.88 | 2.42 | 7568124 | 5.48 | 0.90 | 1.80 | 5.00 | 6.21 |
| &nbsp;&nbsp;&nbsp;2023 | 5120827 | 1.89 | 2.28 | 9737962 | 5.13 | 0.90 | 1.95 | 6.78 | 7.55 |
| &nbsp;&nbsp;&nbsp;2022 | 6029876 | 1.77 | 2.12 | 10757187 | 4.80 | 0.90 | 1.95 | (7.33) | (6.19) |
| &nbsp;&nbsp;&nbsp;2021 | 7497343 | 1.91 | 2.26 | 14291954 | 4.72 | 0.90 | 1.95 | 14.48 | 15.71 |
| Franklin Mutual Shares VIP Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 2701006 | 1.99 | 8.70 | 8721751 | 2.05 | 0.90 | 1.95 | 9.40 | 10.41 |
| &nbsp;&nbsp;&nbsp;2024 | 3467441 | 1.81 | 7.88 | 10301733 | 1.77 | 0.90 | 1.95 | 9.13 | 10.36 |
| &nbsp;&nbsp;&nbsp;2023 | 4802576 | 4.87 | 7.14 | 13015900 | 1.83 | 0.90 | 1.95 | 11.19 | 12.44 |
| &nbsp;&nbsp;&nbsp;2022 | 5692481 | 4.38 | 6.35 | 13918659 | 1.80 | 0.90 | 1.95 | (9.32) | (8.24) |
| &nbsp;&nbsp;&nbsp;2021 | 6904134 | 4.83 | 6.92 | 18015413 | 2.81 | 0.90 | 1.95 | 16.85 | 18.10 |
| FTVIP Franklin DynaTech Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 37797 | 4.90 | 5.71 | 201154 |  | 0.90 | 1.75 | 15.84 | 17.01 |
| &nbsp;&nbsp;&nbsp;2024 | 39819 | 4.23 | 4.88 | 181380 |  | 0.90 | 1.75 | 28.11 | 29.10 |
| &nbsp;&nbsp;&nbsp;2023 | 82819 | 3.30 | 3.78 | 291773 |  | 0.90 | 1.75 | 41.63 | 42.64 |
| &nbsp;&nbsp;&nbsp;2022 | 81322 | 2.33 | 2.65 | 201223 |  | 0.90 | 1.75 | (41.16) | (40.45) |
| &nbsp;&nbsp;&nbsp;2021 | 89396 | 3.96 | 4.45 | 373790 |  | 0.90 | 1.75 | 14.11 | 15.10 |

---

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| Invesco V.I. American Franchise Fund | Invesco V.I. American Franchise Fund |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 1513797 | 4.90 | 5.55 | 8017007 |  | 0.90 | 1.80 | 9.56 | 10.56 |
| &nbsp;&nbsp;&nbsp;2024 | 1946738 | 4.47 | 5.02 | 9344546 |  | 0.90 | 1.80 | 32.57 | 33.87 |
| &nbsp;&nbsp;&nbsp;2023 | 3131020 | 3.37 | 3.75 | 11280038 |  | 0.90 | 1.80 | 38.11 | 39.41 |
| &nbsp;&nbsp;&nbsp;2022 | 3790667 | 2.44 | 2.69 | 9811743 |  | 0.90 | 1.80 | (32.22) | (31.73) |
| &nbsp;&nbsp;&nbsp;2021 | 3862007 | 3.60 | 3.94 | 14697358 |  | 0.90 | 1.80 | 9.91 | 10.92 |
| Invesco V.I. Core Equity Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 446976 | 3.70 | 4.43 | 1831389 | 0.63 | 0.90 | 1.80 | 14.07 | 15.14 |
| &nbsp;&nbsp;&nbsp;2024 | 542713 | 3.24 | 3.85 | 1937279 | 0.63 | 0.90 | 1.80 | 23.19 | 24.60 |
| &nbsp;&nbsp;&nbsp;2023 | 748641 | 2.63 | 3.09 | 2163433 | 0.72 | 0.90 | 1.80 | 21.20 | 22.13 |
| &nbsp;&nbsp;&nbsp;2022 | 852079 | 2.17 | 2.53 | 2021626 | 0.91 | 0.90 | 1.80 | (21.94) | (21.18) |
| &nbsp;&nbsp;&nbsp;2021 | 918614 | 2.78 | 3.21 | 2779784 | 0.64 | 0.90 | 1.80 | 25.44 | 26.59 |
| Invesco V.I. Discovery Large Cap Fund (a) | Invesco V.I. Discovery Large Cap Fund (a) |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 138419 | 4.45 | 5.32 | 671000 |  | 0.90 | 1.80 | 10.63 | 11.53 |
| &nbsp;&nbsp;&nbsp;2024 | 158121 | 4.00 | 4.77 | 687544 |  | 0.90 | 1.80 | 31.37 | 32.50 |
| &nbsp;&nbsp;&nbsp;2023 | 242319 | 3.06 | 3.60 | 797527 |  | 0.90 | 1.80 | 32.47 | 33.83 |
| &nbsp;&nbsp;&nbsp;2022 | 247652 | 2.31 | 2.69 | 611446 |  | 0.90 | 1.80 | (32.26) | (31.55) |
| &nbsp;&nbsp;&nbsp;2021 | 270389 | 3.41 | 3.93 | 982661 |  | 0.90 | 1.80 | 20.08 | 21.18 |
| Invesco V.I. Equity and Income Fund | Invesco V.I. Equity and Income Fund |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 282741 | 2.68 | 3.34 | 854670 | 1.60 | 0.90 | 1.95 | 10.16 | 11.71 |
| &nbsp;&nbsp;&nbsp;2024 | 417204 | 2.41 | 2.99 | 1137639 | 1.41 | 0.90 | 1.95 | 9.82 | 10.74 |
| &nbsp;&nbsp;&nbsp;2023 | 597209 | 2.24 | 2.70 | 1470081 | 1.71 | 0.90 | 1.95 | 8.21 | 9.31 |
| &nbsp;&nbsp;&nbsp;2022 | 668392 | 2.07 | 2.47 | 1514364 | 1.40 | 0.90 | 1.95 | (9.61) | (8.52) |
| &nbsp;&nbsp;&nbsp;2021 | 649926 | 2.29 | 2.70 | 1611600 | 1.67 | 0.90 | 1.95 | 16.05 | 17.29 |

---

(a) Name change. See Note 2.

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| Invesco V.I. Global Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 179370 | 3.02 | 3.77 | 593334 |  | 0.90 | 1.95 | 12.77 | 13.90 |
| &nbsp;&nbsp;&nbsp;2024 | 232514 | 2.66 | 3.31 | 679843 |  | 0.90 | 1.95 | 13.39 | 14.93 |
| &nbsp;&nbsp;&nbsp;2023 | 411699 | 2.39 | 2.88 | 1073606 |  | 0.90 | 1.95 | 32.04 | 32.72 |
| &nbsp;&nbsp;&nbsp;2022 | 445923 | 1.81 | 2.17 | 874851 |  | 0.90 | 1.95 | (33.46) | (32.40) |
| &nbsp;&nbsp;&nbsp;2021 | 493884 | 2.72 | 3.21 | 1450798 |  | 0.90 | 1.95 | 12.93 | 14.14 |
| Invesco V.I. Main Street Mid Cap Fund® | Invesco V.I. Main Street Mid Cap Fund® |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 156398 | 3.17 | 3.84 | 541767 | 0.24 | 0.90 | 1.80 | 7.09 | 8.17 |
| &nbsp;&nbsp;&nbsp;2024 | 177999 | 2.96 | 3.55 | 572498 | 0.45 | 0.90 | 1.80 | 15.09 | 16.01 |
| &nbsp;&nbsp;&nbsp;2023 | 275645 | 2.57 | 3.06 | 773139 | 0.29 | 0.90 | 1.80 | 12.23 | 13.33 |
| &nbsp;&nbsp;&nbsp;2022 | 293175 | 2.29 | 2.70 | 728472 | 0.34 | 0.90 | 1.80 | (15.81) | (15.09) |
| &nbsp;&nbsp;&nbsp;2021 | 335829 | 2.72 | 3.18 | 986237 | 0.42 | 0.90 | 1.80 | 21.03 | 22.14 |
| Invesco V.I. Main Street Small Cap Fund® | Invesco V.I. Main Street Small Cap Fund® |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 2936974 | 3.28 | 3.92 | 10060056 | 0.22 | 0.90 | 1.80 | 6.43 | 7.41 |
| &nbsp;&nbsp;&nbsp;2024 | 3494854 | 3.08 | 3.65 | 11181069 |  | 0.90 | 1.80 | 10.39 | 11.28 |
| &nbsp;&nbsp;&nbsp;2023 | 5153702 | 2.79 | 3.28 | 14883579 | 0.92 | 0.90 | 1.80 | 15.77 | 16.73 |
| &nbsp;&nbsp;&nbsp;2022 | 5806567 | 2.41 | 2.81 | 14427763 | 0.24 | 0.90 | 1.80 | (17.47) | (16.62) |
| &nbsp;&nbsp;&nbsp;2021 | 6595481 | 2.92 | 3.37 | 19780425 | 0.17 | 0.90 | 1.80 | 20.07 | 21.16 |
| Lazard Retirement US Small Cap Equity Select Portfolio | Lazard Retirement US Small Cap Equity Select Portfolio | Lazard Retirement US Small Cap Equity Select Portfolio |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 102325 | 2.98 | 3.49 | 329071 |  | 0.90 | 1.65 | 0.33 | 1.21 |
| &nbsp;&nbsp;&nbsp;2024 | 133114 | 2.85 | 3.45 | 421908 |  | 0.90 | 1.85 | 9.19 | 10.22 |
| &nbsp;&nbsp;&nbsp;2023 | 145387 | 2.61 | 3.13 | 420282 |  | 0.90 | 1.85 | 7.85 | 9.06 |
| &nbsp;&nbsp;&nbsp;2022 | 150706 | 2.42 | 2.87 | 401224 |  | 0.90 | 1.85 | (17.12) | (16.33) |
| &nbsp;&nbsp;&nbsp;2021 | 153593 | 2.92 | 3.43 | 491129 | 0.05 | 0.90 | 1.85 | 17.66 | 18.79 |
| Lord Abbett Series Fund Bond Debenture Portfolio | Lord Abbett Series Fund Bond Debenture Portfolio |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 598836 | 2.02 | 2.56 | 1386865 | 5.57 | 0.90 | 1.95 | 6.22 | 7.56 |
| &nbsp;&nbsp;&nbsp;2024 | 638054 | 1.89 | 2.38 | 1378071 | 4.52 | 0.90 | 1.95 | 4.32 | 5.78 |
| &nbsp;&nbsp;&nbsp;2023 | 966813 | 1.85 | 2.25 | 1973832 | 4.64 | 0.90 | 1.95 | 4.52 | 5.63 |
| &nbsp;&nbsp;&nbsp;2022 | 1130777 | 1.77 | 2.13 | 2197127 | 4.08 | 0.90 | 1.95 | (14.49) | (13.77) |
| &nbsp;&nbsp;&nbsp;2021 | 1393797 | 2.07 | 2.47 | 3146681 | 2.75 | 0.90 | 1.95 | 1.27 | 2.35 |

---

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| Lord Abbett Series Fund Growth and Income Portfolio | Lord Abbett Series Fund Growth and Income Portfolio | Lord Abbett Series Fund Growth and Income Portfolio |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 4966807 | 2.89 | 4.06 | 18626413 | 0.53 | 0.90 | 1.80 | 15.07 | 16.33 |
| &nbsp;&nbsp;&nbsp;2024 | 6200575 | 2.50 | 3.49 | 20069419 | 0.72 | 0.90 | 1.85 | 18.44 | 19.57 |
| &nbsp;&nbsp;&nbsp;2023 | 9230176 | 2.44 | 2.92 | 25035250 | 0.92 | 0.90 | 1.85 | 10.91 | 12.31 |
| &nbsp;&nbsp;&nbsp;2022 | 10498695 | 2.20 | 2.60 | 25491188 | 1.22 | 0.90 | 1.85 | (10.93) | (10.34) |
| &nbsp;&nbsp;&nbsp;2021 | 12488615 | 2.47 | 2.90 | 33884275 | 0.99 | 0.90 | 1.85 | 26.64 | 27.86 |
| Lord Abbett Series Fund Mid Cap Stock Portfolio | Lord Abbett Series Fund Mid Cap Stock Portfolio | Lord Abbett Series Fund Mid Cap Stock Portfolio |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 438041 | 2.23 | 3.26 | 1277094 | 0.31 | 0.90 | 1.80 | 5.06 | 6.19 |
| &nbsp;&nbsp;&nbsp;2024 | 537397 | 2.11 | 3.07 | 1486194 | 0.40 | 0.90 | 1.85 | 12.72 | 13.70 |
| &nbsp;&nbsp;&nbsp;2023 | 687518 | 2.21 | 2.70 | 1686454 | 0.46 | 0.90 | 1.95 | 13.33 | 14.41 |
| &nbsp;&nbsp;&nbsp;2022 | 805168 | 1.95 | 2.36 | 1731647 | 0.77 | 0.90 | 1.95 | (13.33) | (11.94) |
| &nbsp;&nbsp;&nbsp;2021 | 956924 | 2.25 | 2.68 | 2347979 | 0.56 | 0.90 | 1.95 | 26.19 | 27.54 |
| Morningstar Aggressive Growth ETF Asset Allocation Portfolio | Morningstar Aggressive Growth ETF Asset Allocation Portfolio | Morningstar Aggressive Growth ETF Asset Allocation Portfolio |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 724842 | 2.78 | 3.19 | 2171988 | 0.99 | 0.90 | 1.80 | 17.80 | 19.03 |
| &nbsp;&nbsp;&nbsp;2024 | 966932 | 2.36 | 2.68 | 2444949 | 0.94 | 0.90 | 1.80 | 12.32 | 13.56 |
| &nbsp;&nbsp;&nbsp;2023 | 1856574 | 2.09 | 2.36 | 4152903 | 1.58 | 0.90 | 1.80 | 14.84 | 15.69 |
| &nbsp;&nbsp;&nbsp;2022 | 2184518 | 1.82 | 2.04 | 4239683 | 1.39 | 0.90 | 1.80 | (14.95) | (13.92) |
| &nbsp;&nbsp;&nbsp;2021 | 2480635 | 2.14 | 2.37 | 5625404 | 1.06 | 0.90 | 1.80 | 16.21 | 17.27 |
| Morningstar Balanced ETF Asset Allocation Portfolio | Morningstar Balanced ETF Asset Allocation Portfolio | Morningstar Balanced ETF Asset Allocation Portfolio |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 5259176 | 1.97 | 2.26 | 11115808 | 2.04 | 0.90 | 1.80 | 12.57 | 13.99 |
| &nbsp;&nbsp;&nbsp;2024 | 5465899 | 1.75 | 1.99 | 10184343 | 1.52 | 0.90 | 1.80 | 7.98 | 9.34 |
| &nbsp;&nbsp;&nbsp;2023 | 7866266 | 1.62 | 1.82 | 13434613 | 1.87 | 0.90 | 1.80 | 10.96 | 11.66 |
| &nbsp;&nbsp;&nbsp;2022 | 9426282 | 1.46 | 1.63 | 14476343 | 1.64 | 0.90 | 1.80 | (14.62) | (13.76) |
| &nbsp;&nbsp;&nbsp;2021 | 10482968 | 1.71 | 1.89 | 18726090 | 1.29 | 0.90 | 1.80 | 8.80 | 9.79 |
| Morningstar Growth ETF Asset Allocation Portfolio | Morningstar Growth ETF Asset Allocation Portfolio | Morningstar Growth ETF Asset Allocation Portfolio |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 1585374 | 2.43 | 2.79 | 4128121 | 1.33 | 0.90 | 1.80 | 15.57 | 16.81 |
| &nbsp;&nbsp;&nbsp;2024 | 1985248 | 2.10 | 2.39 | 4445084 | 1.19 | 0.90 | 1.80 | 10.53 | 11.68 |
| &nbsp;&nbsp;&nbsp;2023 | 3095156 | 1.90 | 2.14 | 6226113 | 1.77 | 0.90 | 1.80 | 13.10 | 14.44 |
| &nbsp;&nbsp;&nbsp;2022 | 3550181 | 1.68 | 1.87 | 6297742 | 1.49 | 0.90 | 1.80 | (14.72) | (14.22) |
| &nbsp;&nbsp;&nbsp;2021 | 4097929 | 1.97 | 2.18 | 8504678 | 1.19 | 0.90 | 1.80 | 12.82 | 13.85 |

---

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| Morningstar Income and Growth ETF Asset Allocation Portfolio | Morningstar Income and Growth ETF Asset Allocation Portfolio | Morningstar Income and Growth ETF Asset Allocation Portfolio | Morningstar Income and Growth ETF Asset Allocation Portfolio | Morningstar Income and Growth ETF Asset Allocation Portfolio |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 4495006 | 1.52 | 1.79 | 7490669 | 2.16 | 0.90 | 1.95 | 9.35 | 10.67 |
| &nbsp;&nbsp;&nbsp;2024 | 5673934 | 1.39 | 1.62 | 8581998 | 1.65 | 0.90 | 1.95 | 5.80 | 7.28 |
| &nbsp;&nbsp;&nbsp;2023 | 9654068 | 1.31 | 1.51 | 13717458 | 2.06 | 0.90 | 1.95 | 8.26 | 9.42 |
| &nbsp;&nbsp;&nbsp;2022 | 11138684 | 1.21 | 1.38 | 14475802 | 1.67 | 0.90 | 1.95 | (14.18) | (13.21) |
| &nbsp;&nbsp;&nbsp;2021 | 12488694 | 1.41 | 1.59 | 18841810 | 1.35 | 0.90 | 1.95 | 4.39 | 5.51 |
| Neuberger Berman AMT Mid Cap Growth Portfolio | Neuberger Berman AMT Mid Cap Growth Portfolio | Neuberger Berman AMT Mid Cap Growth Portfolio |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 270848 | 2.23 | 2.45 | 637630 |  | 0.90 | 1.80 | 3.23 | 4.26 |
| &nbsp;&nbsp;&nbsp;2024 | 210431 | 2.16 | 2.35 | 477797 |  | 0.90 | 1.80 | 21.23 | 22.87 |
| &nbsp;&nbsp;&nbsp;2023 | 207325 | 1.78 | 1.88 | 384383 |  | 1.10 | 1.80 | 16.34 | 16.77 |
| &nbsp;&nbsp;&nbsp;2022 | 241441 | 1.53 | 1.61 | 382279 |  | 1.10 | 1.80 | (30.45) | (29.69) |
| &nbsp;&nbsp;&nbsp;2021 | 324610 | 2.20 | 2.29 | 732748 |  | 1.10 | 1.80 | 10.70 | 11.48 |
| Neuberger Berman AMT Quality Equity Portfolio (a) | Neuberger Berman AMT Quality Equity Portfolio (a) | Neuberger Berman AMT Quality Equity Portfolio (a) |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 7460278 | 2.10 | 2.23 | 16153483 |  | 0.90 | 1.80 | 11.11 | 12.63 |
| &nbsp;&nbsp;&nbsp;2024 | 9382571 | 1.88 | 1.98 | 18147096 |  | 0.90 | 1.80 | 22.88 | 24.53 |
| &nbsp;&nbsp;&nbsp;2023 | 15023754 | 1.53 | 1.59 | 23449222 | 0.08 | 0.90 | 1.80 | 24.39 | 25.20 |
| &nbsp;&nbsp;&nbsp;2022 | 17281542 | 1.23 | 1.27 | 21596374 | 0.12 | 0.90 | 1.80 | (20.13) | (19.11) |
| &nbsp;&nbsp;&nbsp;2021 | 20166638 | 1.54 | 1.57 | 31394439 | 0.17 | 0.90 | 1.80 | 20.95 | 22.05 |
| PIMCO CommodityReal Return® Strategy Portfolio | PIMCO CommodityReal Return® Strategy Portfolio | PIMCO CommodityReal Return® Strategy Portfolio |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 9603103 | 0.76 | 0.91 | 8077276 | 2.70 | 0.90 | 1.80 | 15.15 | 18.31 |
| &nbsp;&nbsp;&nbsp;2024 | 11872950 | 0.66 | 0.78 | 8527318 | 2.02 | 0.90 | 1.80 | 1.39 | 4.00 |
| &nbsp;&nbsp;&nbsp;2023 | 14780124 | 0.64 | 0.75 | 10344488 | 15.58 | 0.90 | 1.80 | (9.86) | (9.64) |
| &nbsp;&nbsp;&nbsp;2022 | 14753767 | 0.71 | 0.83 | 11367598 | 21.35 | 0.90 | 1.80 | 7.58 | 7.79 |
| &nbsp;&nbsp;&nbsp;2021 | 22596847 | 0.66 | 0.77 | 16214114 | 4.06 | 0.90 | 1.80 | 30.72 | 31.92 |

---

(a) Name change. See Note 2.

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| PIMCO Real Return Portfolio |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 341504 | 1.40 | 1.68 | 535615 | 3.21 | 0.90 | 1.80 | 5.26 | 7.01 |
| &nbsp;&nbsp;&nbsp;2024 | 392073 | 1.33 | 1.57 | 578029 | 2.59 | 0.90 | 1.80 |  | 0.76 |
| &nbsp;&nbsp;&nbsp;2023 | 484192 | 1.32 | 1.56 | 706825 | 2.91 | 0.90 | 1.80 | 1.54 | 2.63 |
| &nbsp;&nbsp;&nbsp;2022 | 739785 | 1.30 | 1.52 | 1049042 | 6.89 | 0.90 | 1.80 | (13.91) | (12.64) |
| &nbsp;&nbsp;&nbsp;2021 | 805838 | 1.51 | 1.74 | 1312934 | 4.83 | 0.90 | 1.80 | 3.58 | 4.53 |
| PIMCO Total Return Portfolio |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 1049259 | 1.44 | 1.77 | 1707328 | 4.01 | 0.90 | 1.95 | 6.29 | 8.05 |
| &nbsp;&nbsp;&nbsp;2024 | 1174894 | 1.35 | 1.64 | 1775388 | 3.92 | 0.90 | 1.95 | 0.68 | 1.42 |
| &nbsp;&nbsp;&nbsp;2023 | 1581605 | 1.34 | 1.62 | 2344741 | 3.48 | 0.90 | 1.95 | 3.88 | 5.19 |
| &nbsp;&nbsp;&nbsp;2022 | 1833265 | 1.29 | 1.54 | 2597015 | 2.48 | 0.90 | 1.95 | (16.23) | (15.38) |
| &nbsp;&nbsp;&nbsp;2021 | 2346873 | 1.54 | 1.82 | 3962933 | 1.72 | 0.90 | 1.95 | (3.29) | (2.25) |
| Rydex VT Inverse Government Long Bond Strategy Fund | Rydex VT Inverse Government Long Bond Strategy Fund | Rydex VT Inverse Government Long Bond Strategy Fund |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 253865 | 0.29 | 0.35 | 77994 | 7.09 | 0.90 | 1.80 |  | 3.13 |
| &nbsp;&nbsp;&nbsp;2024 | 254230 | 0.28 | 0.35 | 77886 | 3.98 | 0.90 | 1.95 | 13.79 | 16.67 |
| &nbsp;&nbsp;&nbsp;2023 | 313025 | 0.24 | 0.30 | 82707 |  | 0.90 | 1.95 |  | 3.45 |
| &nbsp;&nbsp;&nbsp;2022 | 400354 | 0.24 | 0.29 | 105487 |  | 0.90 | 1.95 | 41.18 | 45.00 |
| &nbsp;&nbsp;&nbsp;2021 | 542156 | 0.17 | 0.20 | 99149 |  | 0.90 | 1.95 | (1.00) | 0.06 |
| Rydex VT Nova Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 13706 | 9.37 | 11.51 | 140921 |  | 0.90 | 1.80 | 18.61 | 19.77 |
| &nbsp;&nbsp;&nbsp;2024 | 20202 | 7.64 | 9.61 | 180499 |  | 0.90 | 1.95 | 30.15 | 31.46 |
| &nbsp;&nbsp;&nbsp;2023 | 29945 | 5.87 | 7.31 | 199521 |  | 0.90 | 1.95 | 32.51 | 33.88 |
| &nbsp;&nbsp;&nbsp;2022 | 28471 | 4.43 | 5.46 | 142755 | 0.44 | 0.90 | 1.95 | (31.64) | (30.89) |
| &nbsp;&nbsp;&nbsp;2021 | 30565 | 6.48 | 7.90 | 222017 | 0.26 | 0.90 | 1.95 | 39.42 | 40.91 |
| Templeton Developing Markets VIP Fund | Templeton Developing Markets VIP Fund | Templeton Developing Markets VIP Fund |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 340761 | 1.66 | 8.63 | 955929 | 0.56 | 0.90 | 1.95 | 43.20 | 44.93 |
| &nbsp;&nbsp;&nbsp;2024 | 429930 | 1.15 | 5.96 | 922971 | 4.30 | 0.90 | 1.95 | 5.22 | 6.81 |
| &nbsp;&nbsp;&nbsp;2023 | 692121 | 1.12 | 5.58 | 1346651 | 2.08 | 0.90 | 1.95 | 10.89 | 11.60 |
| &nbsp;&nbsp;&nbsp;2022 | 742744 | 1.01 | 5.00 | 1305359 | 2.59 | 0.90 | 1.95 | (23.48) | (22.72) |
| &nbsp;&nbsp;&nbsp;2021 | 790050 | 1.32 | 6.47 | 1791733 | 0.90 | 0.90 | 1.95 | (7.58) | (6.59) |

---

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| Templeton Foreign VIP Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 755571 | 1.41 | 5.16 | 2621927 | 2.34 | 0.90 | 1.95 | 26.59 | 27.91 |
| &nbsp;&nbsp;&nbsp;2024 | 948227 | 1.11 | 4.04 | 2700788 | 2.51 | 0.90 | 1.95 | (2.97) | (1.77) |
| &nbsp;&nbsp;&nbsp;2023 | 1213000 | 3.41 | 3.76 | 3514784 | 3.25 | 0.90 | 1.95 | 18.40 | 19.75 |
| &nbsp;&nbsp;&nbsp;2022 | 1456317 | 2.88 | 3.14 | 3536760 | 3.10 | 0.90 | 1.95 | (9.43) | (8.45) |
| &nbsp;&nbsp;&nbsp;2021 | 1651615 | 3.18 | 3.43 | 4409552 | 1.86 | 0.90 | 1.95 | 2.13 | 3.22 |
| Templeton Growth VIP Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 3151663 | 1.61 | 6.95 | 7778932 | 0.89 | 0.90 | 1.95 | 21.26 | 22.90 |
| &nbsp;&nbsp;&nbsp;2024 | 4340807 | 1.31 | 5.67 | 8619992 | 0.96 | 0.90 | 1.95 | 3.09 | 4.61 |
| &nbsp;&nbsp;&nbsp;2023 | 5814424 | 3.69 | 5.42 | 11391264 | 3.29 | 0.90 | 1.95 | 18.65 | 19.91 |
| &nbsp;&nbsp;&nbsp;2022 | 7228066 | 3.11 | 4.52 | 11935997 | 0.16 | 0.90 | 1.95 | (13.13) | (12.40) |
| &nbsp;&nbsp;&nbsp;2021‡ | 8616547 | 3.58 | 5.16 | 15973008 | 1.10 | 0.90 | 1.95 | 2.83 | 3.93 |
| TVST Touchstone Balanced Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 182874 | 2.80 | 3.40 | 580563 | 1.86 | 0.90 | 1.95 | 12.00 | 13.33 |
| &nbsp;&nbsp;&nbsp;2024 | 240432 | 2.50 | 3.00 | 672299 | 1.27 | 0.90 | 1.95 | 11.30 | 12.40 |
| &nbsp;&nbsp;&nbsp;2023 | 486513 | 2.24 | 2.67 | 1207540 | 1.43 | 0.90 | 1.95 | 16.06 | 17.62 |
| &nbsp;&nbsp;&nbsp;2022 | 490643 | 1.93 | 2.27 | 1028791 | 0.45 | 0.90 | 1.95 | (17.52) | (16.54) |
| &nbsp;&nbsp;&nbsp;2021 | 537702 | 2.34 | 2.72 | 1363825 | 0.22 | 0.90 | 1.95 | 14.79 | 16.02 |
| TVST Touchstone Bond Fund |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 5545143 | 1.30 | 1.54 | 7889552 | 3.82 | 0.90 | 1.80 | 5.47 | 6.94 |
| &nbsp;&nbsp;&nbsp;2024 | 6399763 | 1.23 | 1.44 | 8573705 | 4.61 | 0.90 | 1.80 |  | 1.52 |
| &nbsp;&nbsp;&nbsp;2023 | 8321526 | 1.23 | 1.43 | 11059936 | 4.53 | 0.90 | 1.80 | 4.24 | 5.15 |
| &nbsp;&nbsp;&nbsp;2022 | 9220082 | 1.18 | 1.36 | 11705009 | 1.94 | 0.90 | 1.80 | (15.71) | (14.47) |
| &nbsp;&nbsp;&nbsp;2021 | 10180857 | 1.40 | 1.59 | 15193369 | 2.54 | 0.90 | 1.80 | (2.98) | (2.09) |
| TVST Touchstone Common Stock Fund | TVST Touchstone Common Stock Fund | TVST Touchstone Common Stock Fund |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 6560376 | 4.71 | 5.57 | 33713342 | 0.49 | 0.90 | 1.80 | 15.57 | 16.77 |
| &nbsp;&nbsp;&nbsp;2024 | 8391838 | 4.07 | 4.77 | 37087307 | 0.52 | 0.90 | 1.80 | 19.35 | 20.45 |
| &nbsp;&nbsp;&nbsp;2023 | 12981359 | 3.41 | 3.96 | 47842898 | 0.41 | 0.90 | 1.80 | 24.45 | 25.71 |
| &nbsp;&nbsp;&nbsp;2022 | 15274399 | 2.74 | 3.15 | 45040553 | 0.38 | 0.90 | 1.80 | (19.17) | (18.60) |
| &nbsp;&nbsp;&nbsp;2021 | 17964337 | 3.39 | 3.87 | 65174465 | 0.51 | 0.90 | 1.80 | 25.55 | 26.70 |

---

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| TVST Touchstone Small Company Fund | TVST Touchstone Small Company Fund | TVST Touchstone Small Company Fund |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 1233050 | 3.68 | 4.35 | 4958021 | 0.19 | 0.90 | 1.80 | 7.60 | 8.75 |
| &nbsp;&nbsp;&nbsp;2024 | 1554055 | 3.42 | 4.00 | 5773623 | 0.36 | 0.90 | 1.80 | 11.65 | 12.68 |
| &nbsp;&nbsp;&nbsp;2023 | 2252276 | 3.06 | 3.55 | 7451202 | 0.22 | 0.90 | 1.80 | 14.61 | 15.26 |
| &nbsp;&nbsp;&nbsp;2022 | 2584028 | 2.67 | 3.08 | 7429128 | 0.03 | 0.90 | 1.80 | (16.04) | (15.15) |
| &nbsp;&nbsp;&nbsp;2021 | 3021873 | 3.18 | 3.63 | 10300501 | 0.06 | 0.90 | 1.80 | 21.94 | 23.06 |
| Virtus Duff & Phelps Real Estate Securities Series | Virtus Duff & Phelps Real Estate Securities Series | Virtus Duff & Phelps Real Estate Securities Series |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 3275706 | 2.20 | 21.33 | 13785654 | 2.52 | 0.90 | 1.95 | (1.20) | (0.14) |
| &nbsp;&nbsp;&nbsp;2024 | 3905966 | 2.22 | 21.36 | 16603442 | 1.64 | 0.90 | 1.95 | 8.69 | 9.90 |
| &nbsp;&nbsp;&nbsp;2023 | 5444944 | 10.70 | 19.44 | 21939135 | 2.17 | 0.90 | 1.95 | 8.85 | 10.08 |
| &nbsp;&nbsp;&nbsp;2022 | 5504857 | 9.83 | 17.66 | 20718454 | 0.92 | 0.90 | 1.95 | (27.51) | (26.78) |
| &nbsp;&nbsp;&nbsp;2021 | 6731467 | 13.56 | 24.12 | 34075994 | 0.69 | 0.90 | 1.95 | 43.57 | 45.10 |
| Virtus KAR Capital Growth Series |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 4371509 | 4.13 | 9.52 | 25389165 |  | 0.90 | 1.95 | 4.88 | 6.03 |
| &nbsp;&nbsp;&nbsp;2024 | 5202250 | 3.91 | 9.00 | 28893560 |  | 0.90 | 1.95 | 23.66 | 25.16 |
| &nbsp;&nbsp;&nbsp;2023 | 6984822 | 5.96 | 4.77 | 31223199 |  | 0.90 | 1.95 | 32.15 | 33.24 |
| &nbsp;&nbsp;&nbsp;2022 | 7771022 | 4.51 | 3.58 | 26189420 |  | 0.90 | 1.95 | (37.36) | (36.64) |
| &nbsp;&nbsp;&nbsp;2021 | 8460690 | 7.20 | 5.65 | 44995935 |  | 0.90 | 1.95 | 9.95 | 11.13 |
| Virtus KAR Enhanced Core Equity Series | Virtus KAR Enhanced Core Equity Series | Virtus KAR Enhanced Core Equity Series |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 3639658 | 2.67 | 7.57 | 19354064 | 1.81 | 0.90 | 2.25 | 11.58 | 12.80 |
| &nbsp;&nbsp;&nbsp;2024 | 4467885 | 2.38 | 6.72 | 21545303 | 2.62 | 0.90 | 2.25 | 7.02 | 8.76 |
| &nbsp;&nbsp;&nbsp;2023 | 6127369 | 2.42 | 5.82 | 27666129 | 2.99 | 0.90 | 2.25 | (0.82) | 0.52 |
| &nbsp;&nbsp;&nbsp;2022 | 6731769 | 2.44 | 5.79 | 30354890 | 2.38 | 0.90 | 2.25 | (4.69) | (3.18) |
| &nbsp;&nbsp;&nbsp;2021 | 7892623 | 2.56 | 5.98 | 36751846 | 2.20 | 0.90 | 2.25 | 14.75 | 16.33 |
| Virtus KAR Small-Cap Growth Series |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 711222 | 3.59 | 17.83 | 11468658 |  | 0.90 | 1.95 | (24.13) | (23.31) |
| &nbsp;&nbsp;&nbsp;2024 | 872173 | 4.70 | 23.25 | 17876673 |  | 0.90 | 1.95 | 7.57 | 8.75 |
| &nbsp;&nbsp;&nbsp;2023 | 1254151 | 17.03 | 21.38 | 24017550 |  | 0.90 | 1.95 | 17.37 | 18.65 |
| &nbsp;&nbsp;&nbsp;2022 | 1409497 | 14.51 | 18.02 | 22730782 |  | 0.90 | 1.95 | (31.69) | (30.98) |
| &nbsp;&nbsp;&nbsp;2021 | 1542501 | 21.24 | 26.11 | 35984482 |  | 0.90 | 1.95 | 2.94 | 4.04 |

---

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Subaccount** | **Units** | **Unit<br> Values<br> Lowest<br> ($) (4)** | **Unit<br> Values<br> Highest<br> ($) (4)** | **Net<br> Assets ($)** | **Investment<br> Income<br> Ratios<br> (%) (1)** | **Expense<br> Ratios<br> Lowest<br> (%) (2)** | **Expense<br> Ratios<br> Highest<br> (%) (2)** | **Total<br> Returns<br> Lowest<br> (%) (3)(4)** | **Total<br> Returns<br> Highest<br> (%) (3)(4)** |
| Virtus KAR Small-Cap Value Series |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 3984018 | 2.27 | 13.09 | 17553371 | 0.29 | 0.90 | 1.95 | (6.35) | (5.35) |
| &nbsp;&nbsp;&nbsp;2024 | 4650551 | 2.41 | 13.83 | 22195996 | 0.48 | 0.90 | 1.95 | 7.77 | 8.98 |
| &nbsp;&nbsp;&nbsp;2023 | 6821317 | 8.62 | 12.69 | 31059975 | 0.53 | 0.90 | 1.95 | 16.80 | 18.05 |
| &nbsp;&nbsp;&nbsp;2022 | 7437147 | 7.38 | 10.75 | 29007228 | 0.20 | 0.90 | 1.95 | (25.60) | (24.83) |
| &nbsp;&nbsp;&nbsp;2021 | 7975107 | 9.92 | 14.30 | 41997589 | 0.11 | 0.90 | 1.95 | 17.39 | 18.64 |
| Virtus Newfleet Multi-Sector Intermediate Bond Series | Virtus Newfleet Multi-Sector Intermediate Bond Series | Virtus Newfleet Multi-Sector Intermediate Bond Series |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 7483455 | 1.90 | 6.76 | 20523553 | 4.86 | 0.90 | 1.95 | 5.54 | 6.62 |
| &nbsp;&nbsp;&nbsp;2024 | 8930995 | 1.79 | 6.34 | 23562238 | 4.77 | 0.90 | 1.95 | 3.75 | 4.97 |
| &nbsp;&nbsp;&nbsp;2023 | 12153517 | 4.17 | 6.04 | 31116377 | 4.52 | 0.90 | 1.95 | 6.65 | 7.86 |
| &nbsp;&nbsp;&nbsp;2022 | 13775770 | 3.91 | 5.60 | 33095950 | 3.16 | 0.90 | 1.95 | (11.34) | (10.40) |
| &nbsp;&nbsp;&nbsp;2021‡ | 15899593 | 4.41 | 6.25 | 43588322 | 2.80 | 0.90 | 1.95 | (0.90) | 0.16 |
| Virtus SGA International Growth Series | Virtus SGA International Growth Series | Virtus SGA International Growth Series |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 21980712 | 1.23 | 5.52 | 45033720 | 0.17 | 0.90 | 1.80 | 7.14 | 8.55 |
| &nbsp;&nbsp;&nbsp;2024 | 25377719 | 1.14 | 5.11 | 48590321 | 0.22 | 0.90 | 1.85 | (7.61) | (6.51) |
| &nbsp;&nbsp;&nbsp;2023 | 33298942 | 4.63 | 4.15 | 69505236 | 0.10 | 0.90 | 1.85 | 16.04 | 16.90 |
| &nbsp;&nbsp;&nbsp;2022 | 38761886 | 3.99 | 3.55 | 69520331 |  | 0.90 | 1.85 | (20.20) | (19.32) |
| &nbsp;&nbsp;&nbsp;2021 | 40789353 | 5.00 | 4.40 | 91928995 |  | 0.90 | 1.85 | 6.32 | 7.35 |
| Virtus VIT Tactical Allocation Series (a) | Virtus VIT Tactical Allocation Series (a) | Virtus VIT Tactical Allocation Series (a) |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;2025 | 1234793 | 2.48 | 7.58 | 7145356 | 1.89 | 0.90 | 1.95 | 4.86 | 5.87 |
| &nbsp;&nbsp;&nbsp;2024 | 1642302 | 2.29 | 7.16 | 8952048 | 1.84 | 0.90 | 1.95 | 11.50 | 12.76 |
| &nbsp;&nbsp;&nbsp;2023 | 2165650 | 4.61 | 6.35 | 10532271 | 1.12 | 0.90 | 1.95 | 19.74 | 21.18 |
| &nbsp;&nbsp;&nbsp;2022 | 2449296 | 3.85 | 5.24 | 9875730 | 0.24 | 0.90 | 1.95 | (31.86) | (31.23) |
| &nbsp;&nbsp;&nbsp;2021‡ | 2694592 | 5.65 | 7.62 | 15868335 | 0.38 | 0.90 | 1.95 | 5.48 | 6.60 |

---

(a) Name change. See Note 2.

(‡) For the noted Fund, a total return fell outside of the disclosed range. The reason for this could be either a new product offering in the given year, and/ or units in a subaccount only invested for a partial period.

(1) The investment income ratios represent the dividends, excluding distributions of capital gains, received by the subaccount from the underlying mutual fund, net of management fees assessed by the fund manager, divided by the average net assets. These ratios exclude those expenses, such as mortality

PHL Variable Accumulation Account

Notes to Financial Statements (continued)

**Note 7. Financial Highlights (continued)**

and expense charges, that result in direct reductions in the unit values. The recognition of investment income by the subaccount is affected by the timing of the declaration of dividends by the underlying fund in which the subaccount invests.

(2) The expense ratios represent the annualized contract expenses of the Separate Account for each period indicated. The ratios include only those expenses that result in a direct reduction of unit values. Charges made directly to contract owner contracts through the redemption of units and expenses of the Fund have been excluded.

(3) These amounts represent the total return for the periods indicated, including changes in the value of the underlying fund, and reflect deductions for all items included in the expense ratio. The total return does not include any expenses assessed through the redemption of units; inclusion of these expenses in the calculation would result in a reduction in the total return presented. The total return is calculated for the period indicated or from the inception date through the end of the reporting period.

(4) Unit value information is calculated on a daily basis regardless of whether or not the subaccount has contract holders.

**Note 8. Subsequent Events**

The Separate Account has performed an evaluation of subsequent events through the date the financial statements were issued and has determined that no items require recognition or disclosure.

![](tm2610824d2_nvpfs-img02.jpg)

KPMG LLP

Two Financial Center

60 South Street

Boston, MA 02111

Report of Independent Registered Public Accounting Firm

To Those Charged with Governance of PHL Variable Insurance Company and

Contract Owners of PHL Variable Accumulation Account:

*Opinion on the Financial Statements*

We have audited the accompanying statements of net assets of the subaccounts listed in the Appendix that comprise PHL Variable Accumulation Account (the Subaccounts) as of December 31, 2025, the related statements of operations and change in net assets for each of the years in the two-year period then ended, and the related notes (collectively, the financial statements) and the financial highlights in Note 7 for each of the years in the five-year period then ended. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Subaccounts as of December 31, 2025, the results of their operations and changes in their net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

*Basis for Opinion*

These financial statements and financial highlights are the responsibility of the Subaccounts' management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Subaccounts in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Such procedures also included confirmation of securities owned as of December 31, 2025, by correspondence with the transfer agents of the underlying mutual funds. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. We believe that our audits provide a reasonable basis for our opinion.

/s/ KPMG LLP

We have served as the auditor of one or more PHL Variable Insurance Company's separate accounts since 2015.

Boston, Massachusetts<br> April 14, 2026

KPMG LLP, a Delaware limited liability partnership, and its subsidiaries are part of<br> the KPMG global organization of independent member firms affiliated with KPMG<br> International Limited, a private English company limited by guarantee.

**Appendix**

<u>PHL Variable Accumulation Account</u>

AB VPS Balanced Hedged Allocation Portfolio

Alger Capital Appreciation Portfolio

Columbia Variable Portfolio – Acorn Fund<sup>(1)</sup>

Columbia Variable Portfolio – Acorn International Fund<sup>(1)</sup>

CVT VP S&P MidCap 400 Index Portfolio **<sup>(1)</sup>**

DWS Equity 500 Index VIP

DWS Small Cap Index VIP

Federated Hermes Fund for U.S. Government Securities II

Federated Hermes Government Money Fund II

Federated Hermes High Income Bond Fund II

Fidelity<sup>®</sup> VIP Contrafund<sup>®</sup> Portfolio

Fidelity<sup>®</sup> VIP Growth Opportunities Portfolio

Fidelity<sup>®</sup> VIP Growth Portfolio

Fidelity<sup>®</sup> VIP Investment Grade Bond Portfolio

Franklin Income VIP Fund

Franklin Mutual Shares VIP Fund

FTVIP Franklin DynaTech Fund

Invesco V.I. American Franchise Fund

Invesco V.I. Core Equity Fund

Invesco V.I. Discovery Large Cap Fund**<sup>(1)</sup>**

Invesco V.I. Equity and Income Fund

Invesco V.I. Global Fund

Invesco V.I. Main Street Mid Cap Fund<sup>®</sup>

Invesco V.I. Main Street Small Cap Fund<sup>®</sup>

Lazard Retirement US Small Cap Equity Select Portfolio **<sup>(1)</sup>**

Lord Abbett Series Fund Bond Debenture Portfolio

Lord Abbett Series Fund Growth and Income Portfolio

Lord Abbett Series Fund Mid Cap Stock Portfolio

Morningstar Aggressive Growth ETF Asset Allocation Portfolio

Morningstar Balanced ETF Asset Allocation Portfolio

Morningstar Growth ETF Asset Allocation Portfolio

Morningstar Income and Growth ETF Asset Allocation Portfolio

Neuberger Berman AMT Mid Cap Growth Portfolio

Neuberger Berman AMT Quality Equity Portfolio**<sup>(1)</sup>**

PIMCO CommodityReal Return<sup>®</sup> Strategy Portfolio

PIMCO Real Return Portfolio

PIMCO Total Return Portfolio

Rydex VT Inverse Government Long Bond Strategy Fund

Rydex VT Nova Fund

Templeton Developing Markets VIP Fund

Templeton Foreign VIP Fund

Templeton Growth VIP Fund

TVST Touchstone Balanced Fund

TVST Touchstone Bond Fund

TVST Touchstone Common Stock Fund

TVST Touchstone Small Company Fund

Virtus Duff & Phelps Real Estate Securities Series

Virtus KAR Capital Growth Series

Virtus KAR Enhanced Core Equity Series

Virtus KAR Small-Cap Growth Series

Virtus KAR Small-Cap Value Series

Virtus Newfleet Multi-Sector Intermediate Bond Series

Virtus SGA International Growth Series

Virtus VIT Tactical Allocation Series **<sup>(1)</sup>**

**<sup>(1)</sup>** See Note 2 to the financial statements for the former name of the subaccount.