Great-West Lifeco delivered its highest-ever base return on equity in the third quarter of 2026, but the result conceals a split that is becoming harder to ignore. Empower carried the quarter while Canada’s group benefits operations dragged for the second consecutive period.
Group base earnings reached $1,323 million, up 8% from a year ago, with base earnings per share rising 11% to $1.48, beating the analyst consensus of $1.42. Base ROE hit 19.4%, a record and in line with the company’s stated medium-term target of 19% or above.
The US segment, anchored by Empower, contributed $510 million in base earnings for the quarter, up 17% year over year and 22% year-to-date. Canada, which held the largest earnings contribution in the group as recently as 2024, came in at $347 million, a 6% decline from $371 million in Q3 2025. The Q2 result was $341 million, itself down 9% year over year, making this the second consecutive quarter of declining Canadian earnings.
The gap between the two segments has widened markedly through 2026: year-to-date, US base earnings of $1.4 billion now comfortably exceed Canada’s $1.04 billion.
The source of Canada’s underperformance is moderated group benefits insurance experience, the same factor that weighed on the Q2 result. The release does not detail the specific product lines under pressure, but two straight quarters of unfavourable group benefits experience points to a book absorbing elevated claims rather than a one-quarter anomaly. Insurance and risk solutions experience improved in Q3, providing a partial offset.
The softness in Canada’s group insurance results is worth watching not just as a financial line but as a signal about the claims environment in the Canadian group benefits market. When the country’s major group insurer reports back-to-back quarters of moderated experience, it reflects conditions that advisors managing group benefit renewals are navigating on the other side of the same ledger.
Retirement and wealth lines now account for more than 50% of Great-West’s base earnings, excluding earnings on surplus and corporate expenses. That threshold, which Great-West explicitly highlighted in its release, marks the completion of a rebalancing that management has been targeting since at least 2024.
The shift is predominantly driven by the US. Great-West’s US$340 million acquisition of Milliman’s retirement and benefits administration business, which closed in September, adds further weight to the US side, bringing Empower’s footprint to more than 22 million participants and a client asset base now embedded in $3.9 trillion of group-wide assets under administration. Capital and risk solutions also contributed, posting $309 million in base earnings, up 17% year over year on sustained demand for capital solutions.
For Canadian brokers and advisors working with group insurance, the earnings composition shift says something specific about where Great-West’s strategic capital and attention are deployed. In Great-West’s Q2 2026 results report, the company has consistently framed its growth priorities around Empower and capital and risk solutions, two businesses that have little to do with the Canadian group benefits and disability market that brokers here sell into.
Great-West’s Canadian LICAT ratio held at 127%, and the company repurchased $340 million of shares in Q3, maintaining its stated pace of capital return.
David Harney, president and CEO of Great-West, said the company was “delivering another excellent quarter” and cited the record ROE alongside disciplined capital deployment including the Milliman closing and further buybacks.
