Kevin Hogan: Yes. Thanks, Alex. So look, I mean we know our responsibility is to regularly review opportunities to increase shareholder value and to optimize the portfolio. I think we’ve demonstrated that. We did prioritize the disposition of the international businesses because one, it allows us to focus on the huge U.S. market; but also two, we saw an opportunity to generate significant value. And we’re still working through the UK close. That’ll take a little bit longer. It’s a more complex environment. When it comes down to other types of transactions, look, we have demonstrated the willingness and the ability to execute on transactions. You just have to go back and look at our creation of what became Fortitude Re. And so we’re familiar with the market, the opportunities, and we continue to evaluate the portfolio.
Now, as a result of the creation of Fortitude Re, we have a high-quality in-force. But as you pointed out, we are current on what transaction terms are available in the market right now. We’re conscious of where our share price is. And we are continuing to evaluate options whether in terms of enhancing the in-force or the efficiency of new business. So we don’t have anything to update right now as and when we have something to update and then we’ll provide more information at that time.
Alex Scott: Very helpful. Second one I have for you is just going back to the comments made on DAC amortization in life insurance. I just wanted to check, I mean, is that higher run rate on DAC amortization, does that fall to the bottom line? And is that reflected in sort of the run rate that we’re looking at from this quarter already or do we need to think about reducing by that amount looking forward?
Elias Habayeb: Hey, Alex, it’s Elias. The $11 million DAC – the increase in the DAC run rates of $11 million, that’s where individual retirement is not in life, and that’s already in the third quarter numbers we published.
Alex Scott: Got it. Okay. Thank you for the clarification.
Elias Habayeb: Yes. And it’s coming across all three products, fixed, index and variable. So the impact is $11 million on a quarterly basis, and it’s kicked in as of July 1.
Alex Scott: Thank you.
Kevin Hogan: Thank you.
Operator: Our next question comes from Tom Gallagher of Evercore. Tom, your line is open. Please go ahead.
Thomas Gallagher: Good morning. Elias, the comment you made about the processing of backlog of surrenders that created higher fixed annuity outflows this quarter, and I think you also mentioned you’re starting to see some acceleration of fixed annuity sales. Would you – taking that together, would you expect 4Q and beyond to get a bit better from a net flow perspective for overall individual retirement and fixed annuities in particular?
Kevin Hogan: Yes. Hey, Tom, it’s Kevin. I think I’m going to fill this one. I’ll start with the surrenders. Look, the third quarter surrenders were nominally high, but I think it’s really important to unpack the behavior throughout the quarter because the trend did change. And essentially what happened is that the surrender levels did peak early in the quarter, which I think reflected some of the processing of the backlog that was there. And then we saw the opportunity, based on what sales were in the first half, we saw the opportunity and how attractive these products were for our customers. So we brought on some additional operational capacity which came online through the third quarter. And we did see the surrender rates successively come down from sort of the beginning of the quarter through the end.
And we’ve seen that trend continuing through October. But at the same time as this new operational capacity came online, we started to see the pace of the fixed annuity sales increase incrementally through the quarter to the point where coming into October, the new sales levels are something comparable to what we saw in the very strong first quarter. And so we had overall net positive flows across IR in the third quarter despite that sort of trend. And if you look at the back half of the quarter as opposed to the front half of the quarter, and if that continues through the rest of the year, we would see some very attractive numbers coming out of fixed annuities. Index annuities continue to be very strong and we would expect growth in the overall general account.
