Jackson Financial Inc. (JXN): Business Model Canvas [11-2024 Updated]

In the dynamic world of financial services, understanding the business model of Jackson Financial Inc. (JXN) offers valuable insights into how this company navigates the complexities of the market. With a strong focus on retirement income solutions and a robust distribution network, Jackson Financial leverages key partnerships and innovative products to cater to a diverse clientele. Dive deeper to explore the intricacies of their Business Model Canvas, revealing how they create value for their customers while maintaining a competitive edge.

Jackson Financial Inc. (JXN) - Business Model: Key Partnerships

Collaboration with Brooke Life for reinsurance transactions

Jackson Financial Inc. has established a significant partnership with Brooke Life, primarily focusing on reinsurance transactions. In the first quarter of 2024, Jackson executed a 100% coinsurance agreement with Brooke Life, which involved the cession of liabilities associated with certain guaranteed benefit riders under its variable annuity contracts. This agreement is designed to mitigate risks related to these market risk benefits.

As part of this transaction, Brooke Re, a subsidiary of Brooke Life, paid a ceding commission of approximately $1.2 billion to Jackson. This agreement allows Jackson to retain the variable annuity base contract and the administration of the ceded business while transferring the associated risks to Brooke Re.

Partnerships with financial institutions for product distribution

Jackson Financial has formed strategic alliances with various financial institutions to enhance its product distribution capabilities. These partnerships facilitate the distribution of Jackson's annuity products, thereby expanding its market reach. As of September 30, 2024, Jackson reported total operating revenues of $5.158 billion, indicating a robust performance supported by these distribution channels.

Partnership Type	Financial Institutions	Products Distributed
Bank Partnerships	Various National and Regional Banks	Variable Annuities, Fixed Indexed Annuities
Broker-Dealer Relationships	Independent Broker-Dealers	Retirement Solutions, Investment Products
Insurance Brokers	Insurance Brokerage Firms	Life Insurance, Annuities

Engagement with investment managers for asset management

Jackson Financial engages with several investment managers to optimize its asset management strategies. The company's investment portfolio is primarily managed by its wholly-owned registered investment advisor, PPM Holdings, Inc. This entity manages a diversified portfolio focusing on fixed-income securities and loans. As of September 30, 2024, PPM managed approximately $26.3 billion in cash, short-term investments, and publicly and privately traded securities.

Additionally, Jackson collaborates with third-party investment managers, including Apollo Insurance Solutions Group LP, which manages funds withheld assets from reinsurance transactions. Apollo managed approximately $14.7 billion in assets as of the same date.

Investment Manager	Assets Managed (in billions)	Investment Focus
PPM Holdings, Inc.	$26.3	Fixed-Income Securities, Loans
Apollo Insurance Solutions	$14.7	Funds Withheld Assets
Other Third-Party Managers	$0.242	Niche Asset Classes

Jackson Financial Inc. (JXN) - Business Model: Key Activities

Underwriting and managing life insurance policies

Jackson Financial Inc. actively underwrites and manages a diverse portfolio of life insurance products. As of September 30, 2024, the net income attributable to common shareholders was $(480) million, a significant decrease compared to $2,762 million in the same quarter of 2023. The company reported total premiums of $106 million for the nine months ended September 30, 2024. The total policy and contract liabilities stood at $283.3 billion, reflecting the scale of its underwriting activities.

Developing and marketing annuity products

Jackson Financial's annuity products are a cornerstone of its business model. For the nine months ended September 30, 2024, the company reported total operating revenues from annuities of $3,886 million, with fee income contributing $3,313 million. The separate account assets associated with variable annuities amounted to $234.7 billion as of September 30, 2024, demonstrating the company's strong position in the annuity market. Jackson's marketing efforts are centered on expanding its annuity offerings, with a focus on both retail and institutional products.

Metrics	Q3 2024	Q3 2023
Net Income (Loss) Attributable to Common Shareholders	$(480) million	$2,762 million
Total Premiums	$106 million	$109 million
Total Operating Revenues from Annuities	$3,886 million	$3,609 million
Separate Account Assets for Variable Annuities	$234.7 billion	$219.4 billion

Risk management through hedging strategies

Risk management is critical to Jackson Financial's operations, particularly through the use of hedging strategies to mitigate market risks. For the three months ended September 30, 2024, the company reported net losses on hedging instruments amounting to $(591) million. The total market risk benefits losses reported were $1,172 million. The company employs derivatives to manage exposures to interest rate fluctuations and equity market movements, which are essential for maintaining financial stability amid market volatility.

Hedging Metrics	Q3 2024	Q3 2023
Net Losses on Hedging Instruments	$(591) million	$(271) million
Total Market Risk Benefits Losses	$(1,172) million	$2,376 million
Net Investment Income (Excluding Funds Withheld Assets)	$457 million	$458 million

Jackson Financial Inc. (JXN) - Business Model: Key Resources

Strong brand reputation in the financial services industry

Jackson Financial Inc. (JXN) has established a strong brand reputation within the financial services sector, particularly in the annuity market. As of 2024, JXN is recognized for its commitment to providing innovative retirement solutions and has a significant presence in the U.S. market. This reputation is supported by its robust customer service and financial strength, which enhances customer trust and loyalty.

Extensive distribution network across multiple channels

Jackson Financial operates through an extensive distribution network that includes various channels such as independent agents, brokers, and financial advisors. In 2024, the company reported that approximately 70% of its sales come from independent agents, showcasing the effectiveness of this channel. Additionally, Jackson has partnered with several financial institutions to enhance its distribution capabilities, further broadening its reach within the market.

Distribution Channel	Percentage of Total Sales (%)	Key Partnerships
Independent Agents	70	Various regional and national brokerage firms
Brokers	20	Leading brokerage houses
Direct Sales	10	Online platforms

Asset management capabilities with significant AUM

Jackson Financial boasts strong asset management capabilities with significant assets under management (AUM). As of September 30, 2024, the company reported a total AUM of approximately $235 billion, which reflects its robust investment strategies and risk management practices. The company’s investment portfolio includes a diverse range of assets, including equities, fixed income, and alternative investments, allowing for effective risk diversification and return optimization.

Asset Class	Value (in billions)	Percentage of Total AUM (%)
Equities	70	29.8
Fixed Income	125	53.2
Alternative Investments	40	17.0

In addition to AUM, Jackson Financial reported a net investment income of $2.208 billion for the nine months ended September 30, 2024, showcasing the effectiveness of its investment strategies.

Jackson Financial Inc. (JXN) - Business Model: Value Propositions

Offering diverse retirement income solutions

Jackson Financial Inc. provides a range of retirement income solutions tailored to meet the diverse needs of customers. The company focuses on variable annuities, registered index-linked annuities (RILAs), and fixed index annuities, with total retail annuity sales reaching $5.272 billion for the three months ended September 30, 2024, compared to $3.312 billion in the same period of 2023. This growth reflects Jackson's commitment to providing innovative products that cater to the retirement market.

Providing tax-deferred growth opportunities through annuities

Jackson Financial's annuities offer tax-deferred growth, allowing policyholders to accumulate wealth without immediate tax implications. As of September 30, 2024, the total account value for variable annuities stood at $242.245 billion, highlighting the significant assets under management and the appeal of tax-deferred growth. Furthermore, the net investment income on funds withheld assets was $824 million for the nine months ended September 30, 2024, showcasing the financial benefits of these products for customers seeking long-term growth.

Delivering guaranteed income options for retirees

Jackson Financial offers guaranteed income options, which are critical for retirees seeking financial security. The company's Guaranteed Minimum Withdrawal Benefit (GMWB) for Life is a popular feature, with an associated benefit base of $183.279 billion as of September 30, 2024. This product allows retirees to receive a steady income stream, regardless of market fluctuations, thus addressing a key concern for individuals in retirement.

Product Type	Account Value (in billions)	Sales (in millions)	Net Investment Income (in millions)
Variable Annuities	242.245	2,632	457
RILAs	N/A	1,608	N/A
Fixed Index Annuities	N/A	48	N/A
Fixed Annuities	N/A	984	N/A

The strategic focus on these value propositions allows Jackson Financial to differentiate itself in a competitive market, addressing customer needs for diverse, tax-efficient, and guaranteed income solutions as they plan for retirement. The company's comprehensive approach underscores its commitment to enhancing the financial well-being of its policyholders.

Jackson Financial Inc. (JXN) - Business Model: Customer Relationships

Personalized Service Through Financial Advisors

Jackson Financial Inc. emphasizes personalized service as a cornerstone of its customer relationships. The company employs a network of financial advisors who provide tailored financial solutions to meet the unique needs of each client. As of September 30, 2024, Jackson's Retail Annuities segment reported operating revenues of $1.344 billion, reflecting a robust demand for personalized financial products and services.

Regular Communication and Updates on Policy Performance

To maintain strong customer relationships, Jackson Financial prioritizes regular communication with its clients. The company ensures that policyholders receive timely updates regarding their policy performance and any relevant market changes. This approach is reflected in their net investment income, which amounted to $726 million for the three months ended September 30, 2024, indicating effective management of client portfolios and proactive engagement in performance discussions.

Building Trust Through Transparent Product Offerings

Jackson Financial is committed to building trust with its customers by offering transparent product offerings. The company's focus on clarity in its financial products helps clients make informed decisions. In the third quarter of 2024, the company reported a net income attributable to common shareholders of $(480) million, showcasing the challenges it faces but also its commitment to transparency regarding financial performance and operational challenges.

Metric	Q3 2024	Q3 2023	Change
Operating Revenues (Retail Annuities)	$1.344 billion	$1.163 billion	+15.5%
Net Investment Income	$726 million	$761 million	-4.6%
Net Income Attributable to Common Shareholders	$(480) million	$2.762 billion	-117.4%
Weighted Average Shares Outstanding (Basic)	75,374,073	82,061,813	-8.1%

This structured approach to customer relationships enables Jackson Financial Inc. to not only acquire new clients but also retain existing ones, thus enhancing overall customer loyalty and satisfaction in a competitive financial services market.

Jackson Financial Inc. (JXN) - Business Model: Channels

Distribution through independent broker-dealers and financial advisors

Jackson Financial Inc. utilizes a robust network of independent broker-dealers and financial advisors for distributing its products, particularly variable annuities and retirement solutions. As of September 30, 2024, the company reported total retail annuity sales of $5,272 million, of which a significant portion is facilitated through these channels.

In the three months ending September 30, 2024, variable annuity sales reached $2,632 million, while Retirement Income Linked Annuities (RILA) accounted for $1,608 million. The distribution model allows Jackson to leverage the expertise of financial advisors, who can provide personalized guidance to clients, enhancing customer engagement and satisfaction.

Online platforms for customer engagement and policy management

Jackson Financial has invested significantly in online platforms to facilitate customer engagement and policy management. These platforms enable clients to manage their policies, view account balances, and make transactions conveniently. For instance, the company reported total assets under management (AUM) of $334,539 million as of September 30, 2024, reflecting the effectiveness of digital engagement tools in managing client assets.

The online platform plays a crucial role in enhancing customer experience, allowing for real-time updates and interactions. As digital adoption continues to rise, Jackson's commitment to maintaining a user-friendly online presence is expected to drive further growth in customer acquisition and retention.

Partnerships with banks for cross-selling opportunities

Jackson Financial has established strategic partnerships with banks to capitalize on cross-selling opportunities. These partnerships allow Jackson to offer its insurance and annuity products to the banks' existing customer base, thereby expanding its reach. In 2024, total institutional product sales amounted to $749 million, highlighting the effectiveness of this channel in generating additional revenue streams.

Through these collaborations, Jackson can provide tailored financial solutions that align with the banks' offerings, thereby enhancing customer value. This approach not only boosts sales but also strengthens relationships with banking partners, contributing to long-term business sustainability.

Channel Type	Sales (in millions)	Contribution to AUM (in millions)	Customer Engagement
Independent Broker-Dealers	2,632 (Variable Annuities) + 1,608 (RILA)	334,539	High
Online Platforms	N/A	334,539	Very High
Bank Partnerships	749 (Institutional Products)	N/A	Moderate

Jackson Financial Inc. (JXN) - Business Model: Customer Segments

Retirees seeking income stability

Jackson Financial Inc. serves retirees who are focused on achieving income stability during their retirement years. This segment primarily includes individuals aged 65 and older, who are looking for reliable income sources to support their living expenses. The company offers a range of annuity products designed to provide guaranteed income, which is particularly appealing in the current economic climate where market volatility can threaten traditional retirement savings.

As of September 30, 2024, the account value for Guaranteed Minimum Withdrawal Benefits (GMWB) for Life products was approximately $176.7 billion, showcasing the significant investment from retirees in stable income products.

Individuals planning for retirement savings

This customer segment includes younger individuals, typically aged 30 to 64, who are actively saving for retirement. They seek products that offer growth potential while also providing some level of safety against market downturns. Jackson Financial's offerings, such as fixed indexed annuities and variable annuities, cater to this demographic by balancing growth and security.

In the third quarter of 2024, Jackson Financial reported total retail annuity sales of $5.272 billion, indicating strong demand for retirement savings products. The company noted that variable annuity sales alone accounted for $2.632 billion during this period, reflecting the growing interest in these products among individuals planning for retirement.

Institutional investors looking for guaranteed investment contracts

Institutional investors represent a critical customer segment for Jackson Financial, particularly those interested in guaranteed investment contracts (GICs). These contracts are appealing to institutions as they provide a secure return on investment, which is essential for managing liabilities and ensuring financial stability. Jackson Financial's Institutional Products segment is tailored to meet the needs of these investors.

For the nine months ended September 30, 2024, total institutional product sales reached $1.461 billion, with significant contributions from GICs. The company's ability to offer competitive rates in the current interest rate environment has positioned it favorably among institutional customers, as evidenced by a notable increase in sales compared to previous periods.

Customer Segment	Key Products	Account Value/Sales (in billions)	Target Age Group
Retirees seeking income stability	GMWB for Life	$176.7	65+
Individuals planning for retirement savings	Fixed Indexed Annuities, Variable Annuities	$5.272 (total retail annuity sales)	30-64
Institutional investors looking for guaranteed investment contracts	Guaranteed Investment Contracts (GICs)	$1.461	Institutional

Jackson Financial Inc. (JXN) - Business Model: Cost Structure

Operational costs associated with policy administration

The operational costs associated with policy administration for Jackson Financial Inc. include various expenses related to managing and servicing policies. For the nine months ended September 30, 2024, the operating costs and other expenses, net of deferrals, amounted to $2,105 million, compared to $1,862 million for the same period in 2023. This increase reflects the company's expanded policy management activities.

Cost Category	2024 (in millions)	2023 (in millions)
Operating Costs and Other Expenses	$2,105	$1,862
Amortization of Deferred Acquisition Costs	$832	$874

Marketing and distribution expenses

Marketing and distribution expenses are crucial for Jackson Financial to maintain its competitive position. The company reported a total of $1,340 million in operating benefits and expenses for the three months ended September 30, 2024. This figure includes costs related to marketing initiatives aimed at attracting new customers and retaining existing ones.

Expense Type	2024 (in millions)	2023 (in millions)
Marketing and Distribution Expenses	$1,340	$1,254
Total Operating Revenues	$2,121	$2,585

Costs related to claims and policyholder benefits

Costs associated with claims and policyholder benefits are significant for Jackson Financial. For the nine months ended September 30, 2024, the death and other policy benefits, along with changes in policy reserves, net of deferrals, totaled $639 million, compared to $701 million in 2023. This category of costs reflects the company's obligations to policyholders and impacts overall profitability.

Cost Category	2024 (in millions)	2023 (in millions)
Death and Other Policy Benefits	$639	$701
Change in Policy Reserves	$209	$232

Jackson Financial Inc. (JXN) - Business Model: Revenue Streams

Fee income from policy management and investments

Jackson Financial Inc. generates significant revenue through fee income associated with policy management and investment activities. For the nine months ended September 30, 2024, the fee income amounted to $6,038 million, an increase from $5,751 million in the same period of 2023.

Period	Fee Income (in millions)
Q3 2024	$2,032
Q3 2023	$1,950
9M 2024	$6,038
9M 2023	$5,751

Premiums from insurance products and annuities

Premiums from insurance products and annuities represent another critical revenue stream. For the nine months ended September 30, 2024, premiums collected totaled $106 million, a slight decrease from $109 million in the same period of 2023.

Period	Premiums (in millions)
Q3 2024	$31
Q3 2023	$32
9M 2024	$106
9M 2023	$109

Investment income generated from asset management

Investment income is a vital component of Jackson Financial's revenue, derived from managing various asset classes. For the nine months ended September 30, 2024, total net investment income was $2,208 million, compared to $2,110 million during the same period in 2023.

Period	Net Investment Income (in millions)
Q3 2024	$726
Q3 2023	$761
9M 2024	$2,208
9M 2023	$2,110

Updated on 16 Nov 2024

Resources:

1. Jackson Financial Inc. (JXN) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Jackson Financial Inc. (JXN)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Jackson Financial Inc. (JXN)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.