I mean, disability continues to perform really well both with respect to incidents and recovery levels. Some of this favorability is stemming from a favorable macro environment. And we believe that, favorability will over time. It’s not going to happen in any given quarter but will over time come back into pricing. But having said that, and I’ll refer back to kind of Michel’s comments on having real focus and strategic intent here in terms of how we’re investing in this business. The favorability we’re seeing in disability is coming from solid underwriting return to health capabilities deployment of data technology, predictive analytics in how we’re running this business in particular investments we’re also making in the live and absent space.
Those are resonating really well in the market. And we believe over time, will allow us to fuel further growth and maintain very robust margins here. And those are not going away. Those are differentiating capabilities that we have and distinct competitive advantages that we will maintain and continue to invest in.
Wes Carmichael: Thanks, Ramy. And maybe sticking with the US on the pension risk transfer market, it seems like maybe the market for full plan terminations has been heating up a little bit. I’m just wondering, if you’re willing to participate in those deals and also what the pipeline looks like as the fourth quarter has been pretty busy historically.
Ramy Tadros: Thanks. So we’re pretty pleased with our performance this quarter. So year-to-date we’ve had $3.5 billion worth of sales. We’ve also added another $600 million of premium so far in the fourth quarter. And we see a very healthy pipeline ahead and really with a lot of visibility into 2024. And in particular in the jumbo end of the market which is where we focus and where we have distinct competitive advantages. Our focus so far has been on the immediate with RV only part of the market and we see significant pipeline there and we’re able to win business at healthy IRRs. But we always continuously evaluate opportunities here. And as we’ve always stated it’s value over volume here. And so if we see opportunities with the right IRRs and the right returns and the right risk profile we’re always going to be looking to evaluate those as we go forward.
Wes Carmichael: Thank you.
Operator: Next we go to the line of Alex Scott with Goldman Sachs. Please go ahead.
Alex Scott: First one I had for you on is LatAm. We continue to see good growth there. I think in the comments you mentioned some of the digital initiatives and things like that. But I wanted to see if you could extrapolate further just on the sustainability of the really robust growth that you’ve seen in PFOs and how we should think about that business going into?
Eric Clurfain: Yes. H, Alex. Thanks for the question. This is Eric. So we’re overall very pleased with our results for the quarter. This is the fourth consecutive quarter of adjusted earnings in the $200 million range. The quarter’s results are primarily driven by volume growth, favorable underwriting as well as foreign currency tailwinds which were partially offset by lower recurring interest margins. And on the top-line side, the positive trajectory continues as you mentioned with solid double-digit growth consistent with our expectations. We’re seeing growth across the region in both our retail and group business. We’ve been very deliberate in expanding beyond our core avenues of growth developing third-party distribution channels such as banks financial institutions retailers and others.
And we’ve made significant technology-related investments in that space. And a good example is what you referred to that Michel mentioned and is opening around the launch of our new integrated platform, which provides embedded insurance capabilities for our distribution partners and thus creating a differentiating competitive advantage for us across the region. So all these factors combined with our disciplined underwriting pricing as well as efficiency focus are contributing to the solid earnings performance and sustained momentum.
Alex Scott: Very helpful. And then second question was on net investment income. Wanted to see if you could help us just with the benefits of higher interest rates and what it means really for net investment income trajectory more broadly across the organization. And then also interested if there’s any tactical things you can do anything you’re doing allocation-wise that we should consider related to net investment income?
John McCallion: Good morning, Alex. It’s John. So a couple of things to point to for your question. We’ve given some sensitivities to interest rate movements in the past. And I think those are still fair approach to thinking about the impact generally driven by the benefits of roll-off and reinvest and you’re seeing that on the slides we shared. So that has an incremental benefit. Obviously, we’ve also done a lot to reduce our interest rate sensitivity over the years. So it’s not a hockey stick per se but there’s inertia there as you look at some of those sensitivities. So I don’t know if I have a number to give, because gross numbers maybe get lost, but those sensitivities are more from an earnings perspective and those are probably pretty good things to follow and think through as you kind of model out earnings growth.
In terms of tactical. I think, there’s always tactical asset allocations that occur. We have a view of relative values that we take into account. But certainly as rates grow fixed-oriented products going to grow in relative value. And we’re seeing some unique opportunities out there. It’s very helpful to have a wide breadth of product and expertise to work through the opportunities that are in the space and that’s scale. That scale is a big benefit. So we’re excited for the opportunities that are out there. And having done that we’ve been maintaining an up in quality mentality when it comes to investments. And with these rates it’s worked pretty well.
Alex Scott: Thank you.
Operator: Our next question is from John Barnidge from Piper Sandler. Please go ahead.
John Barnidge : Good morning. Thank you. Question about the value of new business slide that’s updated not around IRRs, but can you talk about how higher rates in your outlook for that volume to possibly increase along with the value of new business? Thank you.
John McCallion : Hey, John, it’s John. Thanks for the question. I think there’s a couple of ways to think through that as I mentioned in the earlier comment, I mean, we are seeing an increase in demand. And that is — we’ve been able to solve that fairly efficiently with just annual capital generation. And that — but we do think that it is going to grow and we are constantly considering different ways to take advantage of that. I think eventually as — and maybe a little bit to an earlier question as volume and demand grows that could improve pricing to some degree. Right now I think it’s fairly consistent and adjust with interest rates. But there is dynamics between volume and how that can also improve value but that will take some time.
John Barnidge : Thank you very much. And my follow-up question. I know we’re in the thick of renewal season for group benefits, but some retailers have started to comment about the impact from GLP or obesity treatment. How do you — is that something that’s come up within the renewal conversation at all? Just wanted to ask that. Thank you.
