UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

———————————————

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~March 31,~~June 30, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 333-65423

————————————————

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

(Exact name of registrant as specified in its charter)


Arizona						86-0222062
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

525 Washington Boulevard, Jersey City, New Jersey						07310
(Address of principal executive offices)						(Zip Code)

(212) 554-1234

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an “emerging growth company”. See definition of “accelerated filer,” “large accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☒

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of ~~May 10,~~August 17, 2023, 2,500,000 shares of the registrant’s $1.00 par value Common Stock were outstanding, all of which were owned indirectly by Equitable Holdings, Inc.

REDUCED DISCLOSURE FORMAT

Equitable Financial Life Insurance Company of America meets the conditions set forth in General Instruction (H)(1)(a) and (b) of Form 10-Q and is therefore filing this Form with the reduced disclosure format.

Table of Contents

TABLE OF CONTENTS


		Page
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements ~~(Unaudited)~~	3
	Balance Sheets, ~~March 31,~~June 30, 2023 (Unaudited) and December 31, 2022	4
	Statements of Income (Loss), Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022 (Unaudited)	5
	Statements of Comprehensive Income (Loss), Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022 (Unaudited)	6
	Statements of Equity, Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022 (Unaudited)	7
	Statements of Cash Flows, Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022 (Unaudited)	8
	Notes to Financial Statements:
	Note 1 - Organization	910
	Note 2 - Significant Accounting Policies	910
	Note 3 - Investments	1416
	Note 4 - Derivatives	1923
	Note 5 - DAC and Other Deferred Assets/Liabilities	2226

	Note 6 - Fair Value Disclosures	2327
	Note 7 - Liabilities for Future Policyholder Benefits	3237
	Note 8 - Market Risk Benefits	3441
	Note 9 - Policyholder Account Balances	3543
	Note 10 - Income Taxes	3948
	Note 11 - Related Party Transactions	3948
	Note 12 - Equity	3948
	Note 13 - Commitments and Contingent Liabilities	4049
	Note 14 - Insurance Statutory Financial Information	50
	Note 15 - Unpaid Claim and Claim Expenses	41

	~~Note 15 - Revision of Prior Period Financial Statements~~	4150
	Note 16 - ~~Subsequent Events~~Reinsurance	4351
	Note 17 - Revision of Previously Issued Financial Statements	53


Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4456
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	5163
Item 4.	Controls and Procedures	5163

PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	5264
Item 1A.	Risk Factors	5264

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	5264
Item 3.	Defaults Upon Senior Securities	5264
Item 4.	Mine Safety Disclosures	5264
Item 5.	Other Information	5264
Item 6.	Exhibits	5264

Signatures		5971

Table of Contents

NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INFORMATION

Certain of the statements included or incorporated by reference in this Quarterly Report on Form 10-Q constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “expects,” “believes,” “anticipates,” “intends,” “seeks,” “aims,” “plans,” “assumes,” “estimates,” “projects,” “should,” “would,” “could,” “may,” “will,” “shall” or variations of such words are generally part of forward-looking statements. Forward-looking statements are made based on management’s current expectations and beliefs concerning future developments and their potential effects upon Equitable Financial Life Insurance Company of America (“Equitable America”). “We,” “us” and “our” refer to Equitable America, unless the context refers only to Equitable America as a corporate entity. There can be no assurance that future developments affecting Equitable ~~Financial~~America will be those anticipated by management. Forward-looking statements include, without limitation, all matters that are not historical facts.

These forward-looking statements are not a guarantee of future performance and involve risks and uncertainties, and there are certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected in such forward-looking statements, including, among others: (i) conditions in the financial markets and economy, including the impact of plateauing or decreasing economic growth and geopolitical conflicts and related economic conditions, equity market declines and volatility, interest rate fluctuations, impacts on our goodwill and changes in liquidity and access to and cost of capital; (ii) operational factors, indebtedness, protection of confidential customer information or proprietary business information, operational failures by us or our service providers, potential strategic transactions, ~~and~~ changes in accounting standards, and catastrophic events, such as the outbreak of pandemic diseases including COVID-19; (iii) credit, counterparties and investments, including counterparty default on derivative contracts, failure of financial institutions, defaults by third parties and affiliates and economic downturns, defaults and other events adversely affecting our investments; (iv) our reinsurance and hedging programs; (v) our products, structure and product distribution, including variable annuity guaranteed benefits features within certain of our products, variations in statutory capital requirements, financial strength and claims-paying ratings and key product distribution relationships; (vi) estimates, assumptions and valuations, including risk management policies and procedures, potential inadequacy of reserves and experience differing from pricing expectations or reserves, amortization of deferred acquisition costs and financial models; (vii) recruitment and retention of key employees at Equitable Financial and experienced and productive financial professionals; (viii) subjectivity of the determination of the amount of allowances and impairments taken on our investments; (ix) legal and regulatory risks, including federal and state legislation affecting financial institutions, insurance regulation and tax reform; and (x) general risks, including strong industry competition, information systems failing or being compromised and protecting our intellectual property.

Forward-looking statements should be read in conjunction with the other cautionary statements, risks, uncertainties and other factors identified in Equitable America’s Annual Report on Form 10-K for the year ended December 31, 2022, as amended or supplemented in our subsequently filed (i) Current Report on Form 8-K, dated May 17, 2023 (the “Recast 2022 Annual Report”), (ii) Quarterly Reports on Form 10-Q, including in the section entitled “Risk Factors,” and (iii) elsewhere in this Quarterly Report on Form 10-Q. You should read this Form 10-Q completely and with the understanding that actual future results may be materially different from expectations. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law.

Other risks, uncertainties and factors, including those discussed under “Risk Factors”, in our Annual Report on Form 10-K could cause our actual results to differ materially from those projected in any forward-looking statements we make. Readers should read carefully the factors described in “Risk Factors” in our Annual Report on Form 10-K to better understand the risks and uncertainties inherent in our business and underlying any forward-looking statements.

Throughout this Quarterly Report on Form 10-Q we use certain defined terms and abbreviations, which are summarized in the “Glossary” and “Acronyms” sections.

Table of Contents

Part I FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Balance Sheets

~~March 31,~~June 30, 2023 (Unaudited) and December 31, 2022 ~~(Unaudited)~~


		March 31, 2023		December 31, 2022			June 30, 2023		December 31, 2022
		(in millions, except share data)					(in millions, except share data)
ASSETS	ASSETS					ASSETS
Investments:	Investments:					Investments:
Fixed maturities available-for-sale, at fair value (amortized cost of $3,537 and $2,606) (allowance for credit losses of $0 and $0 )		$	3,225	$	2,218
Fixed maturities available-for-sale, at fair value (amortized cost of $6,180 and $2,606) (allowance for credit losses of $0 and $0 )						Fixed maturities available-for-sale, at fair value (amortized cost of $6,180 and $2,606) (allowance for credit losses of $0 and $0 )	$	5,804	$	2,218
Mortgage loans on real estate (net of allowance for credit losses of $0 and $0)	Mortgage loans on real estate (net of allowance for credit losses of $0 and $0)	17		17		Mortgage loans on real estate (net of allowance for credit losses of $0 and $0)	17		17
Policy loans	Policy loans	250		244		Policy loans	260		244
Other equity investments	Other equity investments	18		19		Other equity investments	38		19

Other invested assets	Other invested assets	82		47		Other invested assets	117		47
Total investments	Total investments	3,592		2,545		Total investments	6,236		2,545
Cash and cash equivalents	Cash and cash equivalents	535		294		Cash and cash equivalents	1,080		294
Deferred policy acquisition costs	Deferred policy acquisition costs	824		760		Deferred policy acquisition costs	947		760

Amounts due from reinsurers (allowance for credit losses of $0 and $0)	Amounts due from reinsurers (allowance for credit losses of $0 and $0)	1,040		1,051		Amounts due from reinsurers (allowance for credit losses of $0 and $0)	1,005		1,051

Funds withheld receivable						Funds withheld receivable	10,615		—
Reinsurance deposit assets						Reinsurance deposit assets	12,782		—
Current and deferred income taxes	Current and deferred income taxes	147		76		Current and deferred income taxes	151		76
Purchased market risk benefits	Purchased market risk benefits	11		13		Purchased market risk benefits	10		13
Other assets	Other assets	131		101		Other assets	361		101
Assets for market risk benefits	Assets for market risk benefits	17		12		Assets for market risk benefits	26		12
Separate Accounts assets	Separate Accounts assets	3,867		3,374		Separate Accounts assets	4,508		3,374
Total Assets	Total Assets	$	10,164	$	8,226	Total Assets	$	37,721	$	8,226

LIABILITIES	LIABILITIES					LIABILITIES
Policyholders’ account balances	Policyholders’ account balances	$	4,910	$	3,751	Policyholders’ account balances	$	21,014	$	3,751
Liability for market risk benefits	Liability for market risk benefits	14		15		Liability for market risk benefits	7,363		15
Future policy benefits and other policyholders' liabilities	Future policy benefits and other policyholders' liabilities	707		669		Future policy benefits and other policyholders' liabilities	1,209		669

Amounts due to reinsurers	Amounts due to reinsurers	109		112		Amounts due to reinsurers	106		112

Other liabilities	Other liabilities	182		73		Other liabilities	2,124		73
Separate Accounts liabilities	Separate Accounts liabilities	3,867		3,374		Separate Accounts liabilities	4,508		3,374
Total Liabilities	Total Liabilities	$	9,789	$	7,994	Total Liabilities	$	36,324	$	7,994

Commitments and contingent liabilities (1)	Commitments and contingent liabilities (1)					Commitments and contingent liabilities (1)

EQUITY	EQUITY					EQUITY

Common stock, $1.00 par value; 2,500,000 shares authorized, issued and outstanding	Common stock, $1.00 par value; 2,500,000 shares authorized, issued and outstanding	$	3	$	3	Common stock, $1.00 par value; 2,500,000 shares authorized, issued and outstanding	$	3	$	3
Additional paid-in capital	Additional paid-in capital	831		831		Additional paid-in capital	1,882		831
Accumulated deficit	Accumulated deficit	(157)		(220)		Accumulated deficit	(143)		(220)
Accumulated other comprehensive income (loss)	Accumulated other comprehensive income (loss)	(302)		(382)		Accumulated other comprehensive income (loss)	(345)		(382)

Total Equity	Total Equity	375		232		Total Equity	1,397		232
Total Liabilities and Equity	Total Liabilities and Equity	$	10,164	$	8,226	Total Liabilities and Equity	$	37,721	$	8,226

_____________

(1)See Note 13 of the Notes to these Financial Statements for details of commitments and contingent liabilities.

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Financial Statements (Unaudited).

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Statements of Income (Loss)

Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022 (Unaudited)


		Three Months Ended March 31,			Three Months Ended June 30,					Six Months Ended June 30,
			2023			2022				2023		2022		2023		2022
			(in millions)					(in millions)
REVENUES	REVENUES								REVENUES
Policy charges and fee income	Policy charges and fee income		$	61		$	56		Policy charges and fee income	$	411	$	56	$	472	$	112
Premiums	Premiums		69			49			Premiums	112		60		181		109
Net derivative gains (losses)	Net derivative gains (losses)		6			(8)			Net derivative gains (losses)	(700)		(3)		(694)		(11)
Net investment income (loss)	Net investment income (loss)		29			20			Net investment income (loss)	56		21		85		41
Investment gains (losses), net	Investment gains (losses), net		(5)			(1)			Investment gains (losses), net	—		(2)		(5)		(3)

Investment management and service fees	Investment management and service fees		5			5			Investment management and service fees	105		6		110		11
Other income	Other income		6			—			Other income	38		1		44		1
Total revenues	Total revenues		171			121			Total revenues	22		139		193		260

BENEFITS AND OTHER DEDUCTIONS	BENEFITS AND OTHER DEDUCTIONS								BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	Policyholders’ benefits		79			74			Policyholders’ benefits	335		82		414		156
Remeasurement of liability for future policy benefits	Remeasurement of liability for future policy benefits		(1)			(1)			Remeasurement of liability for future policy benefits	1		—		—		(1)
Change in market risk benefits and purchased market risk benefits	Change in market risk benefits and purchased market risk benefits		—			(5)			Change in market risk benefits and purchased market risk benefits	(862)		1		(862)		(4)
Interest credited to policyholders’ account balances	Interest credited to policyholders’ account balances		23			19			Interest credited to policyholders’ account balances	185		23		208		42
Compensation and benefits	Compensation and benefits		13			11			Compensation and benefits	15		9		28		20
Commissions	Commissions		31			16			Commissions	90		26		121		42

Amortization of deferred policy acquisition costs	Amortization of deferred policy acquisition costs		12			10			Amortization of deferred policy acquisition costs	16		10		28		20
Other operating costs and expenses	Other operating costs and expenses		23			23			Other operating costs and expenses	222		21		245		44
Total benefits and other deductions	Total benefits and other deductions		180			147			Total benefits and other deductions	2		172		182		319
Income (loss) from continuing operations, before income taxes	Income (loss) from continuing operations, before income taxes		(9)			(26)			Income (loss) from continuing operations, before income taxes	20		(33)		11		(59)
Income tax (expense) benefit	Income tax (expense) benefit		72			6			Income tax (expense) benefit	(6)		8		66		14

Net income (loss)	Net income (loss)		$	63		$	(20)		Net income (loss)	$	14	$	(25)	$	77	$	(45)

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Financial Statements (Unaudited).

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Statements of Comprehensive Income (Loss)

Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022 (Unaudited)


		Three Months Ended March 31,			Three Months Ended June 30,					Six Months Ended June 30,
			2023			2022				2023		2022		2023		2022
			(in millions)					(in millions)
COMPREHENSIVE INCOME (LOSS)	COMPREHENSIVE INCOME (LOSS)								COMPREHENSIVE INCOME (LOSS)
Net income (loss)	Net income (loss)		$	63		$	(20)		Net income (loss)	$	14	$	(25)	$	77	$	(45)

Other comprehensive income (loss), net of income taxes:	Other comprehensive income (loss), net of income taxes:								Other comprehensive income (loss), net of income taxes:
Change in unrealized gains (losses), net of adjustments (1)	Change in unrealized gains (losses), net of adjustments (1)		75			(171)			Change in unrealized gains (losses), net of adjustments (1)	(51)		(153)		24		(324)
Changes in market risk benefits - instrument-specific credit risk			5			5

Change in market risk benefits - instrument-specific credit risk									Change in market risk benefits - instrument-specific credit risk	7		3		12		8
Change in liability for future policy benefits - current discount rate									Change in liability for future policy benefits - current discount rate	1		—		1		—
Other comprehensive income (loss), net of income taxes	Other comprehensive income (loss), net of income taxes		80			(166)			Other comprehensive income (loss), net of income taxes	(43)		(150)		37		(316)

Comprehensive income (loss)	Comprehensive income (loss)		$	143		$	(186)		Comprehensive income (loss)	$	(29)	$	(175)	$	114	$	(361)

_____________

(1)See Note 12 of the Notes to these Financial Statements for details of change in unrealized gains (losses), net of adjustments.

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Financial Statements (Unaudited).

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Statements of Equity

For the Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022 (Unaudited)

Three Months Ended March 31,
Equity
Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Equity
(in millions)
January 1, 2023 $ 3 $ 831 $ (220) $ (382) $ 232
Net income (loss) — — 63 — 63
Other comprehensive income (loss) — — — 80 80
Other — — — — —
March 31, 2023 $ 3 $ 831 $ (157) $ (302) $ 375
January 1, 2022 $ 3 $ 680 $ (134) $ 98 $ 647
Net income (loss) — — (20) — (20)
Other comprehensive income (loss) — — — (166) (166)
Other — 1 — — 1
March 31, 2022 $ 3 $ 681 $ (154) $ (68) $ 462


	Three Months Ended June 30,

	Common Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Equity
	(in millions)
Balance, beginning of period	$	3	$	831	$	(157)	$	(302)	$	375
Contribution from parent	—		1,050		—		—		1,050

Net income (loss)	—		—		14		—		14
Other comprehensive income (loss)	—		—		—		(43)		(43)
Other	—		1		—		—		1
Balance, June 30, 2023	$	3	$	1,882	$	(143)	$	(345)	$	1,397


Balance, beginning of period	$	3	$	681	$	(154)	$	(68)	$	462
Dividend of AB Units to parent	—		—		—		—		—
Net income (loss)	—		—		(25)		—		(25)
Other comprehensive income (loss)	—		—		—		(150)		(150)
Other	—		1		—		—		1
Balance, June 30, 2022	$	3	$	682	$	(179)	$	(218)	$	288


	Six Months Ended June 30,

	Common Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Equity
	(in millions)
Balance, beginning of period	$	3	$	831	$	(220)	$	(382)	$	232
Contribution from parent	—		1,050		—		—		1,050
Cumulative effect of adoption of ASU 2016-13, CECL	—		—		—		—		—
Net income (loss)	—		—		77		—		77
Other comprehensive income (loss)	—		—		—		37		37
Other	—		1		—		—		1
Balance, June 30, 2023	$	3	$	1,882	$	(143)	$	(345)	$	1,397





Balance, beginning of period	$	3	$	680	$	(134)	$	98	$	647
Dividend of AB Units to parent	—				—		—		—
Net income (loss)	—		—		(45)		—		(45)
Other comprehensive income (loss)	—		—		—		(316)		(316)
Other	—		2		—		—		2
Balance, June 30, 2022	$	3	$	682	$	(179)	$	(218)	$	288

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Financial Statements (Unaudited).

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Statements of Cash Flows

Three and Six Months Ended ~~March 31,~~June 30, 2023 and 2022 (Unaudited)


		Three Months Ended March 31,				Six Months Ended June 30,
		2023		2022				2023		2022
		(in millions)				(in millions)
Cash flows from operating activities:	Cash flows from operating activities:						Cash flows from operating activities:
Net income (loss)	Net income (loss)	$	63	$	(20)		Net income (loss)	$	77	$	(45)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:	Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:						Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Interest credited to policyholders’ account balances	Interest credited to policyholders’ account balances	23		19			Interest credited to policyholders’ account balances	208		42
Policy charges and fee income	Policy charges and fee income	(61)		(56)			Policy charges and fee income	(472)		(112)
Net derivative (gains) losses	Net derivative (gains) losses	(6)		8			Net derivative (gains) losses	694		11

Investment (gains) losses, net	Investment (gains) losses, net	5		1			Investment (gains) losses, net	5		3
Realized and unrealized (gains) losses on trading securities		2		—

Non-cash long-term incentive compensation expense	Non-cash long-term incentive compensation expense	1		1			Non-cash long-term incentive compensation expense	1		2

Amortization and depreciation	Amortization and depreciation	13		10			Amortization and depreciation	124		21

Remeasurement of liability for future policy benefits	Remeasurement of liability for future policy benefits	(1)		(1)			Remeasurement of liability for future policy benefits	—		(1)
Change in Market Risk Benefits		—		(5)
Change in market risk benefits							Change in market risk benefits	(862)		(4)
Changes in:	Changes in:						Changes in:

Reinsurance recoverable	Reinsurance recoverable	(9)		1			Reinsurance recoverable	817		(12)
Funds withheld receivable							Funds withheld receivable	13		—

Capitalization of deferred policy acquisition costs	Capitalization of deferred policy acquisition costs	(76)		(26)			Capitalization of deferred policy acquisition costs	(215)		(52)
Future policy benefits	Future policy benefits	9		9			Future policy benefits	133		17
Current and deferred income taxes (1)	Current and deferred income taxes (1)	(72)		(7)			Current and deferred income taxes (1)	(66)		(14)
Other, net	Other, net	89		74			Other, net	431		105
Net cash provided by (used in) operating activities	Net cash provided by (used in) operating activities	$	(20)	$	8		Net cash provided by (used in) operating activities	$	888	$	(39)

Cash flows from investing activities:	Cash flows from investing activities:						Cash flows from investing activities:
Proceeds from the sale/maturity/prepayment of:	Proceeds from the sale/maturity/prepayment of:						Proceeds from the sale/maturity/prepayment of:
Fixed maturities, available-for-sale	Fixed maturities, available-for-sale	$	58	$	50		Fixed maturities, available-for-sale	$	98	$	120

Short-term investments	Short-term investments	—		(2)			Short-term investments	(1)		(1)

Other							Other	80		—
Payment for the purchase/origination of:	Payment for the purchase/origination of:						Payment for the purchase/origination of:
Fixed maturities, available-for-sale	Fixed maturities, available-for-sale	(963)		(119)			Fixed maturities, available-for-sale	(3,582)		(289)

Trading account securities		(2)		—

Other	Other	—		(1)			Other	(99)		(1)
Cash settlements related to derivative instruments, net	Cash settlements related to derivative instruments, net	(96)		(24)			Cash settlements related to derivative instruments, net	(208)		(97)

Other, net	Other, net	(6)		—			Other, net	(16)		(8)
Net cash provided by (used in) investing activities	Net cash provided by (used in) investing activities	$	(1,009)	$	(96)		Net cash provided by (used in) investing activities	$	(3,728)	$	(276)

Cash flows from financing activities:	Cash flows from financing activities:						Cash flows from financing activities:
Policyholders’ account balances:	Policyholders’ account balances:						Policyholders’ account balances:
Deposits	Deposits	$	1,202	$	187		Deposits	$	3,453	$	357
Withdrawals	Withdrawals	(13)		(20)			Withdrawals	(1,064)		(44)
Transfer (to) from Separate Accounts	Transfer (to) from Separate Accounts	(15)		(59)			Transfer (to) from Separate Accounts	26		(93)

Payments of market risk benefits							Payments of market risk benefits	(181)		—
Change in collateralized pledged liabilities	Change in collateralized pledged liabilities	96		(1)			Change in collateralized pledged liabilities	342		(3)

Cash contribution from parent company							Cash contribution from parent company	1,050		—
Other, net	Other, net	—		(1)			Other, net	—		4
Net cash provided by (used in) financing activities	Net cash provided by (used in) financing activities	$	1,270	$	106		Net cash provided by (used in) financing activities	$	3,626	$	221

Change in cash and cash equivalents	Change in cash and cash equivalents	241		18			Change in cash and cash equivalents	786		(94)
Cash and cash equivalents, beginning of year		294		127
Cash and cash equivalents, end of year		$	535	$	145
Cash and cash equivalents, beginning of period							Cash and cash equivalents, beginning of period	294		127
Cash and cash equivalents, end of period							Cash and cash equivalents, end of period	$	1,080	$	33

_______________

(1) ~~For the period~~The six months ended ~~March 31,~~June 30, 2023 includes a release of $69 million deferred tax valuation allowance. ~~Refer to~~See Note 10 of the Notes to these ~~Consolidated~~ Financial Statements.

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Statements of Cash Flows

Three and Six Months Ended June 30, 2023 and 2022 (Unaudited)

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Financial Statements (Unaudited).

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited)

1) ORGANIZATION

Equitable Financial Life Insurance Company of America’s (“Equitable America” or “the Company”) primary business is providing variable annuity, life insurance and employee benefit products to both individuals and businesses. The Company is an indirect, wholly-owned subsidiary of ~~Holdings.~~Equitable Holdings, Inc. (“Holdings”). Equitable America is a stock life insurance company organized under the laws of Arizona.

Internal Reinsurance Transaction

On May 17, 2023, Equitable America entered into a reinsurance agreement (the “Reinsurance Treaty”) with its affiliate, Equitable Financial Life Insurance Company, a New York domiciled life insurance company (“Equitable Financial”), effective April 1, 2023. Pursuant to the Reinsurance Treaty, virtually all of Equitable Financial’s net retained general account liabilities, including all of its net retained liabilities relating to the living benefit and death riders related to (i) its variable annuity contracts issued outside the State of New York prior to October 1, 2022 (and with respect to its EQUI-VEST variable annuity contracts, issued outside the State of New York prior to February 1, 2023) and (ii) certain universal life insurance policies issued outside the State of New York prior to October 1, 2022 were reinsured to Equitable America on a coinsurance funds withheld basis. In addition, all of the separate account liabilities relating to such variable annuity contracts were reinsured to Equitable America on a modified coinsurance basis. Equitable America’s obligations under the Reinsurance Treaty are secured through Equitable Financial’s retention of certain assets supporting the reinsured liabilities. The New York Department of Financial Services (the “NYDFS”) and the Arizona Department of Insurance and Financial Institutions each approved the Reinsurance Treaty.

As a condition to approving the Reinsurance Treaty, the NYDFS has required that Equitable Financial seeks to novate the reinsured contracts on a reasonable best effort basis either to Equitable America or another affiliate over the next three years. Novations of the reinsured contracts are subject to additional regulatory approvals, as well as certain policyholder approvals.

At the effective date of the transaction, April 1, 2023, the Company recorded a funds withheld receivable of $11.2 billion, reinsurance deposit assets of $12.9 billion, MRB of $8.2 billion, policyholders’ account balances of $13.9 billion (includes $32.4 billion of assumed policyholder account balances related to the non-insulated (“NI”) modco offset by $28.7 billion of NI modco receivable), future policy benefits and other policyholders' liabilities of $357 million, and cost of reinsurance liability of $1.7 billion. Additionally, $64.1 billion of Insulated Separate Account liabilities were assumed under a modified coinsurance portion of the agreement.

2) SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The unaudited interim financial statements (the “financial statements”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”) on a basis consistent with reporting interim financial information in accordance with instructions to the Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”).

In the opinion of management, all adjustments necessary for a fair statement of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature. Interim results are not necessarily indicative of the results that may be expected for the full year. These financial statements should be read in conjunction with the Company’s financial statements included in the ~~Company’s~~Recast 2022 Annual ~~Report on Form 10-K for the year ended December 31, 2022.~~Report. Certain prior period amounts were adjusted to reflect the adoption of ASU 2018-12: Financial Services - Insurance (Topic 944).

The terms ~~“first~~“second quarter 2023” and ~~“first~~“second quarter 2022” refer to the three months ended ~~March 31,~~June 30, 2023 and 2022, respectively. The terms “first ~~three~~six months of 2023” and “first ~~three~~six months of 2022” refer to the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022, respectively.

~~Certain prior year amounts have been reclassified~~

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to ~~conform to the current year’s presentation.~~Financial Statements (Unaudited), Continued

Adoption of New Accounting Pronouncements


Description			Effect on the Financial Statement or Other Significant Matters
ASU 2018-12: Financial Services - Insurance (Topic 944)
This ASU provides targeted improvements to existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The ASU primarily impacts four key areas, including: 1. Measurement of the liability for future policy benefits for traditional and limited payment contracts. The ASU requires companies to review, and if necessary, update cash flow assumptions at least annually for non-participating traditional and limited-payment insurance contracts. The ASU also prescribes the discount rate to be used in measuring the liability for future policy benefits for traditional and limited payment long-duration contracts. 2. Measurement of Market Risk Benefits (“ MRBs”). MRBs, as defined under the ASU, will encompass certain GMxB features associated with variable annuity products and other general account annuities with other than nominal market risk. 3. Amortization of deferred acquisition costs. The ASU simplifies the amortization of deferred acquisition costs and other balances amortized in proportion to premiums, gross profits, or gross margins, requiring such balances to be amortized on a constant level basis over the expected term of the contracts. 4. Expanded footnote disclosures. The ASU requires additional disclosures including information about significant inputs, judgements, assumptions and methods used in measurement.			On January 1, 2023, the Company adopted the new accounting standard ASU 2018-12 using the modified retrospective approach, except for MRBs which will use the full retrospective approach. Refer to “Transition impact of ASU 2018-12, Financial Services- Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts” section within this note for further details.

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

Transition impact of ASU 2018-12, Financial Services—Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts

The Company has not retrospectively adjusted its financial statements for the year ended December 31, 2020 to reflect the adoption of ASU 2018-12, consistent with the Division of Corporation Finance’s Financial Reporting Manual Section 11410.1.

The Company adopted ASU 2018-12 for liability for future policy benefits (“LFPB”), additional insurance liabilities, DAC and balances amortized on a basis consistent with DAC on a modified retrospective basis. ASU 2018-12 was adopted for MRBs on a full retrospective basis.

The majority of the transition impacts come from removal of DAC and URL adjustments balances recorded in accumulated other comprehensive income (AOCI) impact, resulting in a favorable AOCI. There is limited impact from LFPB and MRB as of transition.

The following table presents the effect of transition adjustment to total equity resulting from the adoption of ASU 2018-12 as of January 1, 2021:

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued



	Retained Earnings		Accumulated Other Comprehensive Income		Total
	(in millions)
Liability for future policy benefits (1)	$	—	$	—	$	—
Market risk benefits	2		(1)		1
DAC	—		110		110

Unearned revenue liability and sales inducement assets (1)	—		(37)		(37)

Total transition adjustment before taxes	2		72		74
Income taxes	(1)		(15)		(16)
Total transition adjustment (net of taxes)	$	1	$	57	$	58

_____________

(1)Unearned revenue liability included within liability for future policy benefits financial statement line item in the balance sheet. Sales inducement assets are included in other assets in the balance sheets.

The following table summarizes the balance of and changes in DAC on January 1, 2021 resulting from the adoption of ASU 2018-12:


	Variable Universal Life		Indexed Universal Life		Total
	(in millions)
Balance, December 31, 2020	$	230	$	247	$	477
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	70		40		110
Balance, January 1, 2021	$	300	$	287	$	587

The following table summarizes the balance of and changes in sales inducement assets and unearned revenue liability on January 1, 2021 resulting from the adoption of ASU 2018-12:


	Variable Universal Life		Indexed Universal Life		Total
	(in millions)
Balance, December 31, 2020	$	55	$	14	$	69
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	28		9		37

Balance, January 1, 2021	$	83	$	23	$	106

DAC

Acquisition costs that vary with and are primarily related to the acquisition of new and renewal insurance business, reflecting incremental direct costs of contract acquisition with independent third parties or employees that are essential

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

to the contract transaction, as well as the portion of employee compensation, including employee fringe benefits and other costs directly related to underwriting, policy issuance and processing, medical inspection, and contract selling for successfully negotiated contracts including commissions, underwriting, agency and policy issue expenses, are deferred.

Contracts are measured on a grouped basis utilizing cohorts consistent with those used in the calculation of future policy benefit reserves. DAC is amortized on a constant level basis for the grouped contracts over the expected term of the contract. For life insurance products, DAC is amortized in proportion to the face amount in force. For annuity products DAC is amortized in proportion to policy counts. The constant level basis used for amortization determines the current period amortization considering both the current period’s actual experience and future projections. The amortization pattern is revised quarterly on a prospective basis. Amortization of DAC is included in Amortization of DAC, part of total benefits and other deductions.

For some products, policyholders can elect to modify product benefits, features, rights or coverages that occur by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to a contract, or by election or coverage within a contract. These transactions are known as internal replacements. If such modification substantially

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

changes the contract, the associated DAC is written off immediately through income and any new acquisition costs associated with the replacement contract are deferred.

Funds withheld receivable

~~Amount due~~Funds withheld receivable represents a receivable for amounts contractually withheld by ceding companies in accordance with funds withheld coinsurance (“funds withheld”) reinsurance agreements in which we are the reinsurer. The funds withheld receivable under reinsurance treaties includes the funds withheld embedded derivative receivable.

The reinsurance agreement between the Company and Equitable Financial written on a funds withheld and modified coinsurance basis contains embedded derivatives. We determined that the obligation to receive the total return on the assets funds withheld receivable, represents a total return swap with a floating rate leg. The fair value of embedded derivatives on funds withheld and modified coinsurance agreements is computed as the unrealized gain (loss) on the underlying assets and is included within funds withheld receivable on the balance sheets for assumed agreement. The change in the fair value of the embedded derivatives is recorded in net derivatives gains (losses) on the statements of income. Assumed earnings from the funds withheld receivable and changes in the fair value of embedded derivatives are reported in operating activities on the statements of cash flows. Contributions to and withdrawals from ~~Reinsurers~~funds withheld receivable are reported in operating activities on the statements of cash flows.

For business assumed on a funds withheld or modified coinsurance basis, a funds withheld segregated portfolio, comprised of invested assets and other assets is maintained by the ceding entity, which is sufficient to support the current balance of statutory reserves. The fair value of the embedded derivative included in funds withheld is recorded as a funds withheld asset and any excess or shortfall in relation to statutory reserves is settled quarterly.

Reinsurance

For each of its reinsurance agreements, the Company determines whether the agreement provides indemnification against loss or liability relating to insurance risk in accordance with applicable accounting standards. Cessions under reinsurance agreements do not discharge the Company’s obligations as the primary insurer. The Company reviews all contractual features, including those that may limit the amount of insurance risk to which the reinsurer is subject or features that delay the timely reimbursement of claims.

For reinsurance of existing in-force blocks of long-duration contracts that transfer significant insurance risk, the difference, if any, between the amounts paid (received), and the liabilities ceded (assumed) related to the underlying contracts is considered the net cost of reinsurance at the inception of the reinsurance agreement. Subsequent amounts paid (received) on the reinsurance of in-force blocks, as well as amounts paid (received) related to new business, are recorded as premiums ceded (assumed); and amounts due from reinsurers (amounts due to reinsurers) are established.

Assets and liabilities relating to reinsurance agreements with the same reinsurer may be recorded net on the balance sheet, if a right of offset exists within the reinsurance agreement. As a result, we have netted the receivable and payable related to modified coinsurance agreements. In the event that reinsurers do not meet their obligations to the Company under the terms of the reinsurance agreements, reinsurance recoverable balances could become uncollectible. In such instances, reinsurance recoverable balances are stated net of allowances for uncollectible reinsurance.

Premiums, policy charges and fee income, and policyholders’ benefits include amounts assumed under reinsurance agreements and are net of reinsurance ceded. Amounts received from reinsurers for policy administration are reported in other revenues.

For reinsurance contracts, reinsurance recoverable balances are generally calculated using methodologies and assumptions that are consistent with those used to calculate the direct liabilities.

Ceded reinsurance transactions are recognized and measured in a manner consistent with underlying reinsured contracts, including using consistent assumptions. Assumed and ceded reinsurance contract rights and obligations are accounted for on a basis consistent with our direct contract. The reinsurance cost or benefit for traditional life non-participating and limited-payment contracts is recognized in proportion to the gross premiums of the underlying direct cohorts. The locked-in single A discount rate used to calculate the reinsurance cost or benefit is established at inception of the reinsurance contract. Changes to the single A discount rate are reflected in comprehensive income at each reporting date.

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

If the Company determines that a reinsurance agreement does not expose the reinsurer to a reasonable possibility of a significant loss from insurance risk, the Company records the agreement using the deposit method of accounting. Deposits received are included in other liabilities and deposits made are included within ~~other~~reinsurance deposit assets. As amounts are paid or received, consistent with the underlying contracts, the deposit assets or liabilities are adjusted. ~~Interest on such deposits is~~Recognition of losses are recorded ~~as other income or~~in other operating ~~costs and expenses, as appropriate.~~expenses. Recognition of gains are recorded in other income.

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

Policyholders’ Account Balances

Policyholders’ account balances relate to contracts or contract features where the Company has no significant insurance risk. This liability represents the contract value that has accrued to the benefit of the policyholder as of the balance sheet date.

The reinsurance agreement between the Company and Equitable Financial written on a modified coinsurance basis contains embedded derivatives. We determined that the obligation to pay the total return on the assets the modified coinsurance,represents a total return swap with a floating rate leg. The fair value of embedded derivatives on the modified coinsurance agreement is computed as the unrealized gain (loss) and current period income on the underlying assets included within Policyholder account balances on the balance sheets for the assumed agreement. The change in the fair value of the embedded derivatives is recorded in net derivative gains (losses) on the statements of income. Assumed earnings from the modified coinsurance and changes in the fair value of embedded derivatives are reported in operating activities on the statements of cash flows. Contributions to and withdrawals from the Policyholder account balances are reported in financing activities on the statements of cash flows.

Future Policy Benefits and Other Policyholders’ Liabilities

For traditional life insurance policies, future policy benefit liabilities are estimated using a net level premium method on the basis of actuarial assumptions as to mortality, persistency and interest established at policy issue. Assumptions established at policy issue as to mortality and persistency are based on the Company’s experience that, together with interest and expense assumptions, includes a margin for adverse deviation. Benefit liabilities for traditional annuities during the accumulation period are equal to accumulated policyholders’ fund balances and, after annuitization, are equal to the present value of expected future payments. Interest rates used in establishing such liabilities range from 3.5% to 4.5% of life insurance liabilities and a ~~rate~~range of ~~0.3%~~4.5% to 5.5% for retained annuity liabilities.

For traditional life insurance policies and limited pay contracts, contracts are grouped into cohorts by contract type and issue year. The Company quarterly updates its estimate of cash flows using actual experience and current future cash flow assumptions, which is reflected in an updated net premium ratio used to calculate the liability. The ratio of actual and future expected claims to actual and future expected premiums determines the net premium ratio. The policy administration expense assumption is not updated after policy issuance. If actual expenses differ from the original expense assumptions, the differences are recognized in the period identified. The revised net premium ratio is used to determine the updated liability for future policy benefits as of the beginning of the reporting period, discounted at the original contract issuance rate. Changes in the liability due to current discount rates differing from original rates are included in other comprehensive income within the statement of comprehensive income.

For non-participating traditional life insurance policies (Term) and limited pay contracts (Payout, Pension), the discount rate assumption used is corporate A rated forward curve. We use a forward curve based upon a Bloomberg index. The liability is remeasured each quarter with the remeasurement change reported in other comprehensive income. The locked-in discount rate is generally based on expected investment returns at contract inception for contracts issued prior to January 1, 2021 and the upper medium grade fixed income corporate instrument yield (i.e., single A) at contract inception for contracts issued after January 1, 2021. The Company developed an LDTI discount rate methodology used to calculate the LFPB for its traditional insurance liabilities and constructed a discount rate curve that references upper-medium grade (low credit risk) fixed-income instrument yields (i.e. Single-A rated Corporate bond yields) which are meant to reflect the duration characteristics of the corresponding insurance liabilities. The methodology uses observable market data, where available, and uses various estimation techniques in line with fair value guidance (such as interpolation and extrapolation) where data is limited. Discount rates are updated quarterly.

For limited-payment products, gross premiums received in excess of net premiums are deferred at initial recognition as a deferred profit liability (“DPL”). DPL will be amortized in relation to the expected future benefit payments. As the calculation of the DPL is based on discounted cash flows, interest accrues on the unamortized DPL balance using the discount rate determined at contract issuance. The DPL is updated at the same time as the estimates for cash flows for the liability for future policy benefits. Any difference between the recalculated and beginning of period DPL is

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

recognized in remeasurement gain or loss in the statement of income (loss), Remeasurement of Liability for Future Policy Benefits, part of total benefits and other deductions. On the balance sheet the DPL is recorded in the liability for future policy benefits.

Additional liabilities for contract or contract feature that provide for additional benefits in addition to the account balance but are not market risk benefits or embedded derivatives (“additional insurance liabilities”) are established by estimating the expected value of death or other insurance benefits in excess of the projected contract accumulation value and recognizing the excess over the estimated life based on expected assessments (i.e., benefit ratio). The liability equals the current benefit ratio multiplied by cumulative assessments recognized to date, plus interest, less cumulative excess payments to date. These reserves are recorded within future policy benefits and other policyholders’ liabilities. The determination of this estimated future policy benefits liability is based on models that involve numerous assumptions and subjective judgments, including those regarding expected market rates of return and volatility, contract surrender and withdrawal rates, and mortality experience. There can be no assurance that actual experience will be consistent with management’s estimates. Assumptions are reviewed annually and updated with the remeasurement gain or loss reflected in total benefit expense.

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

The Company recognizes an adjustment in other comprehensive income for the additional insurance liabilities for unrealized gains and losses not included when calculating the present value of expected assessments for the benefit ratios.

The Company conducts annual premium deficiency testing except for liability for future policy benefits for non-participating traditional and limited payment contracts. The Company reviews assumptions and determines whether the sum of existing liabilities and the present value of future gross premiums is sufficient to cover the present value of future benefits to be paid and settlement costs. Anticipated investment income is considered when performing premium deficiency for long duration contracts. The anticipated investment income is projected based on current investment portfolio returns grading to long term reinvestment rates over the projection periods, based on anticipated gross reinvestment spreads, defaults and investment expenses. Premium deficiency reserves are recorded in certain instances where the policyholder liability for a particular line of business may not be deficient in the aggregate to trigger loss recognition, but the pattern of earnings may be such that profits are expected to be recognized in earlier years followed by losses in later years. This pattern of profits followed by losses is exhibited in our VISL business and is generated by the cost structure of the product or secondary guarantees in the contract. The secondary guarantee ensures that, subject to specified conditions, the policy will not terminate and will continue to provide a death benefit even if there is insufficient policy value to cover the monthly deductions and charges. We accrue for these PFBL using a dynamic approach that changes over time as the projection of future losses change.

Liabilities for unpaid claims and claim adjustment expenses are established for the Company’s employee benefits products which include the following Group products: long-term and short-term disability, life insurance, vision, dental, critical Illness, and accident. Unpaid claim and claim adjustment expenses consist of (i) claim reserves for known claims that are unpaid as of the balance sheet date; (ii) Incurred But Not Reported reserves for claims where the insured event occurred but has not yet been reported to the Company or the insured has not yet satisfied elimination period to be eligible for the benefits; and (iii) claim adjustment expense reserves for settling the claim run-out. The Company determines Incurred But Not Reported reserves and reviews the claim reserves for the long-term disability claims provided by a reinsurer managing the claims on the Company’s behalf. The claim adjustment expense reserves are set based on the Company’s anticipated cost associated with claim administration expenses on the run-out of business.

For long-term disability (“LTD”) the claim reserves for the reported claims are calculated as the present value of the net monthly LTD benefits (Social Security and other offsets may be estimated if unknown) and the best estimate probabilities of the claimant remaining disabled for a given benefit payment which are based on a termination rates table adjusted for experience. Should the offsets be estimated, they are estimated using the claimant’s salary, duration of disability and the probability of the offset award.

The disability termination rates vary based on the insured’s age at disability, gender, elimination period, the duration of disability, social security status and the number of months remaining in the benefit period. The rates account for the probabilities of both recovery and death. The reserves vary with plan provisions such as monthly benefit, offsets, own occupation period, benefit duration, cost of living adjustment (“COLA”), and minimum and maximum benefits. The discount rate assumptions for these liabilities are set annually and are based on projected investment returns for the asset portfolios. The interest rate is locked in for each claimant based on the year of disability.

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

For long-term disability, critical illness, and group accident the incurred but not reported reserves are determined using the expected loss ratio method, where the expected loss ratio is applied to the premiums to determine ultimate liabilities. For dental and vision, the incurred but not reported reserves are determined using completion factors, where these factors complete paid-to-date claims to the ultimate liability based on past experience. For short-term disability and group life the incurred but not reported reserves are determined using a combination of expected loss ratio and completion factor methods.

Market Risk Benefits

Market risk benefits (“MRBs”) are contracts or contract features that provide protection to the contract holder from other than nominal capital market risk and expose the Company to other than nominal capital market risk. Market risk benefits include contract features that provide minimum guarantees to policyholders and include GMIB, GMDB, and ROP DB benefits. MRBs are measured at fair value on a seriatim basis using an ascribed fee approach based upon policyholder behavior projections and risk neutral economic scenarios adjusted based on the facts and circumstances of the Company’s product features. The MRB Asset and MRB Liability will be equal to the average present value of benefits and risk margins less the average present value of ascribed fees. Ascribed fees will consist of the fee needed, under a stochastically generated set of risk-neutral scenarios, so that the mean present value of claims, including any

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

risk charge, is equal to the mean present value of the projected attributed fees which will be capped at average present value of total policyholder contractual fees. The attributed fee percentage is considered a fixed term of the MRB feature and is held static over the life of the contract. Changes in fair value are recognized as a remeasurement gain/loss in the Change in market risk benefits and purchased market risk benefits, part of total benefits and other deductions except for the portion of the change in the fair value due to change in the Company’s own credit risk, which is recognized in other than comprehensive income. Additionally, when an annuitization occurs (for annuitization benefits) or upon extinguishment of the account balance (for withdrawal benefits) the balance related to the MRB will be derecognized and the amount deducted (after derecognition of any related amount included in accumulated other comprehensive income) shall be used in the calculation of the liability for future policy benefits for the payout annuity. Upon derecognition, any related balance will be removed from AOCI.

The Company has issued and continues to offer certain variable annuity products with GMDB and/or contain a GMIB (collectively, the “GMxB features”) which, if elected by the policyholder after a stipulated waiting period from contract issuance, guarantees a minimum lifetime annuity based on predetermined annuity purchase rates that may be in excess of what the contract account value can purchase at then-current annuity purchase rates. This minimum lifetime annuity is based on predetermined annuity purchase rates applied to a GMIB base.

Features in ceded reinsurance contracts that meet the definition of MRBs are accounted for at fair value. The fees used to determine the fair value of the reinsured market risk benefit are those defined in the reinsurance contract. The expected periodic future premiums would represent cash outflows and the expected future benefits would represent cash inflows in the fair value calculation. On the ceded side, the Purchased MRB will be measured considering the counterparty credit risk of the reinsurer, while the direct contract liabilities will be measured considering the instrument-specific credit risk of the insurer. As a result of the difference in the treatment of the counterparty credit risk, the fair value of the direct and ceded contracts may be different even if the contractual fees and benefits are the same. Changes in instrument-specific credit risk of the Company is included in the fair value of its market risk benefit, whether in an asset or liability position, and whether related to an issued or purchased MRB, is recognized in OCI. The counterparty credit risk of the reinsurer is recorded in the statements of income (loss).

Revision of Previously Issued Financial Statements

During the quarter ended September 30, 2022, the Company identified an error in its previously issued financial statements specifically related to the amortization of the cost of reinsurance asset. The impact of this error to prior periods financial statements were not considered to be material. The impact of the errors to prior periods financial statements was not considered to be material. See Note 17 to the Notes to these Financial Statements for details of the revision.

Out of Period Adjustment

During the three months ended June 30, 2023, the Company recorded out of period adjustment resulting in a decrease of $5 million to Income (loss) from continuing operations, before income taxes. The adjustments relate to an understatement of policyholders’ benefits expenses and an understatement of other liabilities in the period ended and as of December 31, 2021, respectively. The error was not material to any prior period.

3) INVESTMENTS

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Fixed Maturities AFS

The components of fair value and amortized cost for fixed maturities classified as AFS on the balance sheets excludes accrued interest receivable because the Company elected to present accrued interest receivable within other assets. Accrued interest receivable on AFS fixed maturities as of ~~March 31,~~June 30, 2023 and December 31, 2022 was ~~$33~~$50 million and $23 million, respectively. There was no accrued interest written off for AFS fixed maturities for the three and six months ended ~~March 31,~~June 30, 2023 and 2022.

The following tables provide information relating to the Company’s fixed maturities classified as ~~AFS.~~AFS:

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

AFS Fixed Maturities by Classification


		Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value			Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		(in millions)											(in millions)
March 31, 2023:
June 30, 2023:												June 30, 2023:
Fixed Maturities:	Fixed Maturities:											Fixed Maturities:
Corporate (1)	Corporate (1)	$	3,272	$	—	$	13	$	298	$	2,987	Corporate (1)	$	4,421	$	—	$	5	$	345	$	4,081
U.S. Treasury, government and agency	U.S. Treasury, government and agency	14		—		—		—		14		U.S. Treasury, government and agency	15		—		—		1		14
States and political subdivisions	States and political subdivisions	50		—		—		7		43		States and political subdivisions	51		—		—		8		43
Foreign governments	Foreign governments	31		—		—		—		31		Foreign governments	30		—		—		—		30
Residential mortgage-backed	Residential mortgage-backed	9		—		—		2		7		Residential mortgage-backed	416		—		—		5		411
Asset-backed (2)	Asset-backed (2)	77		—		—		2		75		Asset-backed (2)	1,082		—		—		6		1,076
Commercial mortgage-backed	Commercial mortgage-backed	84		—		—		16		68		Commercial mortgage-backed	165		—		—		16		149

Total at March 31, 2023		$	3,537	$	—	$	13	$	325	$	3,225
Total at June 30, 2023												Total at June 30, 2023	$	6,180	$	—	$	5	$	381	$	5,804

December 31, 2022:	December 31, 2022:											December 31, 2022:
Fixed Maturities:	Fixed Maturities:											Fixed Maturities:
Corporate (1)	Corporate (1)	$	2,417	$	—	$	—	$	359	$	2,058	Corporate (1)	$	2,417	$	—	$	—	$	359	$	2,058
U.S. Treasury, government and agency	U.S. Treasury, government and agency	14		—		—		—		14		U.S. Treasury, government and agency	14		—		—		—		14
States and political subdivisions	States and political subdivisions	43		—		—		9		34		States and political subdivisions	43		—		—		9		34

Residential mortgage-backed	Residential mortgage-backed	8		—		—		2		6		Residential mortgage-backed	8		—		—		2		6
Asset-backed (2)	Asset-backed (2)	43		—		—		2		41		Asset-backed (2)	43		—		—		2		41
Commercial mortgage-backed	Commercial mortgage-backed	81		—		—		16		65		Commercial mortgage-backed	81		—		—		16		65

Total at December 31, 2022	Total at December 31, 2022	$	2,606	$	—	$	—	$	388	$	2,218	Total at December 31, 2022	$	2,606	$	—	$	—	$	388	$	2,218

______________

(1)Corporate fixed maturities include both public and private issues.

(2)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities. and other asset types.

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

The contractual maturities of AFS fixed maturities as of ~~March 31,~~June 30, 2023 are shown in the table below. Bonds not due at a single maturity date have been included in the table in the final year of maturity. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Contractual Maturities of AFS Fixed Maturities


		Amortized Cost (Less Allowance for Credit Losses)		Fair Value			Amortized Cost (Less Allowance for Credit Losses)		Fair Value
		(in millions)					(in millions)
March 31, 2023:
June 30, 2023:						June 30, 2023:
Contractual maturities:	Contractual maturities:					Contractual maturities:
Due in one year or less	Due in one year or less	$	85	$	85	Due in one year or less	$	127	$	126
Due in years two through five	Due in years two through five	742		726		Due in years two through five	888		860
Due in years six through ten	Due in years six through ten	1,481		1,397		Due in years six through ten	2,370		2,256
Due after ten years	Due after ten years	1,059		867		Due after ten years	1,132		926
Subtotal	Subtotal	3,367		3,075		Subtotal	4,517		4,168
Residential mortgage-backed	Residential mortgage-backed	9		7		Residential mortgage-backed	416		411
Asset-backed	Asset-backed	77		75		Asset-backed	1,082		1,076
Commercial mortgage-backed	Commercial mortgage-backed	84		68		Commercial mortgage-backed	165		149

Total at March 31, 2023		$	3,537	$	3,225
Total at June 30, 2023						Total at June 30, 2023	$	6,180	$	5,804

The following table shows proceeds from sales, gross gains (losses) from sales and allowance for credit losses for AFS fixed ~~maturities.~~

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

maturities:

Proceeds from Sales, Gross Gains (Losses) from Sales and Allowance for Credit and Intent to Sell Losses for AFS Fixed Maturities


		Three Months Ended March 31,					Three Months Ended June 30,				Six Months Ended June 30,
			2023		2022				2023		2022		2023		2022
			(in millions)				(in millions)
Proceeds from sales	Proceeds from sales		$	50	$	23		Proceeds from sales	$	—	$	39	$	50	$	62
Gross gains on sales	Gross gains on sales		$	—	$	—		Gross gains on sales	$	—	$	—	$	—	$	—
Gross losses on sales	Gross losses on sales		$	(5)	$	1		Gross losses on sales	$	—	$	3	$	(5)	$	4

Net (increase) decrease in Allowance for Credit and Intent to Sell losses	Net (increase) decrease in Allowance for Credit and Intent to Sell losses		$	—	$	—		Net (increase) decrease in Allowance for Credit and Intent to Sell losses	$	—	$	—	$	—	$	—

The following table sets forth the amount of credit loss impairments on AFS fixed maturities held by the Company at the dates indicated and the corresponding changes in such ~~amounts.~~amounts:

AFS Fixed Maturities - Credit and Intent to Sell Loss Impairments


		Three Months Ended March 31,			Three Months Ended June 30,				Six Months Ended June 30,
			2023			2022			2023		2022		2023		2022
			(in millions)						(in millions)
Balance, beginning of period	Balance, beginning of period		$	—		$	2	Balance, beginning of period	$	—	$	2	$	—	$	2
Previously recognized impairments on securities that matured, paid, prepaid or sold	Previously recognized impairments on securities that matured, paid, prepaid or sold		—			—		Previously recognized impairments on securities that matured, paid, prepaid or sold	—		(2)		—		(2)
Recognized impairments on securities impaired to fair value this period (1)	Recognized impairments on securities impaired to fair value this period (1)		—			—		Recognized impairments on securities impaired to fair value this period (1)	—		—		—		—
Credit losses recognized this period on securities for which credit losses were not previously recognized	Credit losses recognized this period on securities for which credit losses were not previously recognized		—					Credit losses recognized this period on securities for which credit losses were not previously recognized	—		—		—
Additional credit losses this period on securities previously impaired	Additional credit losses this period on securities previously impaired		—			—		Additional credit losses this period on securities previously impaired	—		—		—		—
Increases due to passage of time on previously recorded credit losses	Increases due to passage of time on previously recorded credit losses		—			—		Increases due to passage of time on previously recorded credit losses	—		—		—		—
Accretion of previously recognized impairments due to increases in expected cash flows (for OTTI securities 2019 and prior)			—			—
Balance at March 31,			$	—		$	2

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Accretion of previously recognized impairments due to increases in expected cash flows (for OTTI securities 2019 and prior)

—

Balance, end of period

—

______________

(1)Represents circumstances where the Company determined in the current period that it intends to sell the security, or it is more likely than not that it will be required to sell the security before recovery of the security’s amortized cost.

The tables that follow below present a roll-forward of net unrealized investment gains (losses) recognized in AOCI.

Net Unrealized Gains (Losses) on AFS Fixed Maturities


	Three Months Ended June 30, 2023
	Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, beginning of period	$	(312)	$	6	$	145	$	(161)
Net investment gains (losses) arising during the period	(64)		—		—		(64)
Reclassification adjustment:							—
Included in Net income (loss)	—		—		—		—
Excluded from Net income (loss)	—		—		—		—
Impact of net unrealized investment gains (losses)	—		1		14		15
Net unrealized investment gains (losses) excluding credit losses	(376)		7		159		(210)
Net unrealized investment gains (losses) with credit losses	—		—		—		—
Balance, end of period	$	(376)	$	7	$	159	$	(210)

	Three Months Ended June 30, 2022
	Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, beginning of period	$	(93)	$	2	$	19	$	(72)
Net investment gains (losses) arising during the period	(202)		—		—		(202)
Reclassification adjustment:							—
Included in Net income (loss)	2		—		—		2
Excluded from Net income (loss)	—		—		—		—
Impact of net unrealized investment gains (losses)	—		4		41		45
Net unrealized investment gains (losses) excluding credit losses	(293)		6		60		(227)
Net unrealized investment gains (losses) with credit losses (1)	—		—		—		—
Balance, end of period	$	(293)	$	6	$	60	$	(227)

Six Months Ended June 30, 2023

Net Unrealized Gains (Losses) on Investments

Policyholders’ Liabilities

Deferred Income Tax Asset (Liability)

AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)

Net Unrealized Gains (Losses) on Investments Policyholders’ Liabilities Deferred Income Tax Asset (Liability) AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
(in millions)
Balance, January 1, 2023 $ (388) $ 8 $ 161 $ (219)
Net investment gains (losses) arising during the period 71 — — 71
Reclassification adjustment:
Included in net income (loss) 5 — — 5
Other (1) — — — —
Impact of net unrealized investment gains (losses) — (2) (16) (18)
Net unrealized investment gains (losses) excluding credit losses (312) 6 145 (161)
Net unrealized investment gains (losses) with credit losses — — — —
Balance, March 31, 2023 $ (312) $ 6 $ 145 $ (161)

1619

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


											(in millions)
Balance, beginning of period										Balance, beginning of period	$	(388)	$	8	$	161	$	(219)
Net investment gains (losses) arising during the period										Net investment gains (losses) arising during the period	7		—		—		7
Reclassification adjustment:										Reclassification adjustment:
Included in net income (loss)										Included in net income (loss)	5		—		—		5

Other (1)										Other (1)	—		—		—		—
Impact of net unrealized investment gains (losses)										Impact of net unrealized investment gains (losses)	—		(1)		(2)		(3)
Net unrealized investment gains (losses) excluding credit losses										Net unrealized investment gains (losses) excluding credit losses	(376)		7		159		(210)
Net unrealized investment gains (losses) with credit losses										Net unrealized investment gains (losses) with credit losses	—		—		—		—
Balance, end of period										Balance, end of period	$	(376)	$	7	$	159	$	(210)

		Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)			Six Months Ended June 30, 2022
		(in millions)									Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
											(in millions)
Balance, January 1, 2022		$	128	$	(3)	$	(26)	$	99
Balance, beginning of period										Balance, beginning of period	$	128	$	(3)	$	(26)	$	99
Net investment gains (losses) arising during the period	Net investment gains (losses) arising during the period	(222)		—		—		(222)		Net investment gains (losses) arising during the period	(424)		—		—		(424)
Reclassification adjustment:	Reclassification adjustment:									Reclassification adjustment:
Included in net income (loss)	Included in net income (loss)	1		—		—		1		Included in net income (loss)	3		—		—		3

Other	Other	—		—		—		—		Other	—		—		—		—
Impact of net unrealized investment gains (losses)	Impact of net unrealized investment gains (losses)	—		5		45		50		Impact of net unrealized investment gains (losses)	—		9		86		95
Net unrealized investment gains (losses) excluding credit losses	Net unrealized investment gains (losses) excluding credit losses	(93)		2		19		(72)		Net unrealized investment gains (losses) excluding credit losses	(293)		6		60		(227)
Net unrealized investment gains (losses) with credit losses	Net unrealized investment gains (losses) with credit losses	—		—		—		—		Net unrealized investment gains (losses) with credit losses	—		—		—		—
Balance, March 31, 2022		$	(93)	$	2	$	19	$	(72)
Balance, end of period										Balance, end of period	$	(293)	$	6	$	60	$	(227)

The following tables disclose the fair values and gross unrealized losses of the ~~853~~1,172 issues as of ~~March 31,~~June 30, 2023 and the 845 issues as of December 31, 2022 that are not deemed to have credit losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position for the specified periods at the dates indicated:

AFS Fixed Maturities in an Unrealized Loss Position for Which No Allowance Is Recorded

Less Than 12 Months 12 Months or Longer Total
Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses
(in millions)
March 31, 2023:
Fixed Maturities:
Corporate $ 730 $ 22 $ 1,472 $ 276 $ 2,202 $ 298
U.S. Treasury, government and agency 7 — 7 — 14 —
States and political subdivisions 6 — 28 7 34 7
Foreign governments 14 — — — 14 —
Residential mortgage-backed — — 6 2 6 2
Asset-backed 14 — 23 2 37 2
Commercial mortgage-backed — — 65 16 65 16
Redeemable preferred stock — — — — — —
Total at March 31, 2023 $ 771 $ 22 $ 1,601 $ 303 $ 2,372 $ 325
December 31, 2022:
Fixed Maturities:
Corporate $ 1,446 $ 159 $ 590 $ 200 $ 2,036 $ 359
States and political subdivisions 19 4 13 5 32 9
Residential mortgage-backed 2 — 4 2 6 2
Asset-backed 35 1 6 1 41 2
Commercial mortgage-backed 5 1 60 15 65 16
Total at December 31, 2022 $ 1,507 $ 165 $ 673 $ 223 $ 2,180 $ 388


	Less Than 12 Months				12 Months or Longer				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in millions)
June 30, 2023:
Fixed Maturities:
Corporate	$	1,928	$	38	$	1,555	$	307	$	3,483	$	345
U.S. Treasury, government and agency	5		—		9		1		14		1
States and political subdivisions	6		1		27		7		33		8

Residential mortgage-backed	331		2		6		3		337		5
Asset-backed	680		5		31		1		711		6
Commercial mortgage-backed	85		1		60		15		145		16

Total at June 30, 2023	$	3,035	$	47	$	1,688	$	334	$	4,723	$	381

1720

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


	Less Than 12 Months				12 Months or Longer				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in millions)
December 31, 2022:
Fixed Maturities:
Corporate	$	1,446	$	159	$	590	$	200	$	2,036	$	359

States and political subdivisions	19		4		13		5		32		9

Residential mortgage-backed	2		—		4		2		6		2
Asset-backed	35		1		6		1		41		2
Commercial mortgage-backed	5		1		60		15		65		16

Total at December 31, 2022	$	1,507	$	165	$	673	$	223	$	2,180	$	388

The Company’s investments in fixed maturities do not include concentrations of credit risk of any single issuer greater than 10% of the equity of the Company, other than securities of the U.S. government, U.S. government agencies, and certain securities guaranteed by the U.S. government. The Company maintains a diversified portfolio of corporate securities across industries and issuers and does not have exposure to any single issuer in excess of 1.3% of total corporate securities. The largest exposures to a single issuer of corporate securities held as of ~~March 31,~~June 30, 2023 and December 31, 2022 were ~~$39~~$54 million and $24 million, respectively, representing ~~10.3%~~3.9% and 10.3% of the equity of the Company.

Corporate high yield securities, consisting primarily of public high yield bonds, are classified as other than investment grade by the various rating agencies, i.e., a rating below Baa3/BBB- or the NAIC designation of 3 (medium investment grade), 4 or 5 (below investment grade) or 6 (in or near default). As of ~~March 31,~~June 30, 2023 and December 31, 2022, respectively, approximately $7$48 million and $4 million, or ~~0.2%~~0.8% and 0.2%, of the ~~$3.5~~$6.2 billion and $2.6 billion aggregate amortized cost of fixed maturities held by the Company were considered to be other than investment grade. These securities had no gross unrealized losses as of ~~March 31,~~June 30, 2023 and December 31, 2022.

As of ~~March 31,~~June 30, 2023 and December 31, 2022, respectively, the ~~$303~~$334 million and $223 million of gross unrealized losses of twelve months or more were concentrated in corporate securities. In accordance with the policy described in Note 2 of the Notes to these Financial Statements, the Company concluded that an allowance for credit losses for these securities was not warranted at either ~~March 31,~~June 30, 2023 or December 31, 2022. As of ~~March 31,~~June 30, 2023 and December 31, 2022, the Company did not intend to sell the securities nor will it likely be required to dispose of the securities before the anticipated recovery of their remaining amortized cost basis.

Based on the Company’s evaluation both qualitatively and quantitatively of the drivers of the decline in fair value of fixed maturity securities as of ~~March 31,~~June 30, 2023, the Company determined that the unrealized loss was primarily due to increases in interest rates and credit spreads.

Mortgage Loans on Real Estate

The Company held two commercial mortgage loans with a carrying value of $17 million and $17 million at ~~March 31,~~June 30, 2023 and December 31, 2022. The loans were issued prior to 2017 for apartment complex properties located in the Mid-Atlantic region. The loans were current as of ~~March 31,~~June 30, 2023 and December 31, 2022 with LTV ratios between 0%-50% and DSC ratios of 2.0x or greater.

Accrued interest receivable as of ~~March 31,~~June 30, 2023 and December 31, 2022 was $0 million and no accrued interest was written off for the three and six months ended ~~March 31,~~June 30, 2023 and 2022. The allowance for credit losses was $0 million as of ~~March 31,~~June 30, 2023 and 2022, with a change of $0 million for the periods ended.

As of ~~March 31,~~June 30, 2023 and 2022, the Company had no loans for which foreclosure was probable included within the individually assessed mortgage loans, and accordingly had no associated allowance for credit losses.

Equity Securities

The table below presents a breakdown of unrealized and realized gains and (losses) on equity securities during the three and six months ended ~~March 31,~~June 30, 2023 and 2022.

~~Unrealized and Realized Gains (Losses) from Equity Securities~~

Three Months Ended March 31,
2023 2022
(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period $ (1) $ (2)
Net investment gains (losses) recognized on securities sold during the period — —
Unrealized and realized gains (losses) on equity securities $ (1) $ (2)

1821

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Unrealized and Realized Gains (Losses) from Equity Securities


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period	$	—	$	(1)	$	(1)	$	(3)
Net investment gains (losses) recognized on securities sold during the period	—		—		—		—
Unrealized and realized gains (losses) on equity securities	$	—	$	(1)	$	(1)	$	(3)

Trading Securities

As of ~~March 31,~~June 30, 2023 and December 31, 2022, respectively, the fair value of the Company’s trading securities was $1$0 million and $1 million. As of ~~March 31,~~June 30, 2023 and December 31, 2022, respectively, trading securities included the General Account’s investment in Separate Accounts had carrying values of $1 million and $1 million.

The table below shows a breakdown of net investment income (loss) from trading securities during the three and six months ended ~~March 31,~~June 30, 2023 and 2022.

Net Investment Income (Loss) from Trading Securities


		Three Months Ended March 31,					Three Months Ended June 30,		Six Months Ended June 30,
		2023		2022					2023		2022		2023		2022
		(in millions)				(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period	Net investment gains (losses) recognized during the period on securities held at the end of the period	$	(2)	$	—			Net investment gains (losses) recognized during the period on securities held at the end of the period	$	2	$	—	$	—	$	—
Net investment gains (losses) recognized on securities sold during the period	Net investment gains (losses) recognized on securities sold during the period	—		—				Net investment gains (losses) recognized on securities sold during the period	—		—		—		—
Unrealized and realized gains (losses) on trading securities	Unrealized and realized gains (losses) on trading securities	(2)		—				Unrealized and realized gains (losses) on trading securities	2		—		—		—
Interest and dividend income from trading securities	Interest and dividend income from trading securities	—		—				Interest and dividend income from trading securities	—		—		—		—
Net investment income (loss) from trading securities	Net investment income (loss) from trading securities	$	(2)	$	—			Net investment income (loss) from trading securities	$	2	$	—	$	—	$	—

Net Investment Income

The following tables provide the components of net investment income by investment type:


	Three Months Ended June 30,		Six Months Ended June 30,
	2023		2022			2023		2022

	(in millions)
Fixed maturities	$	48		$	22	$	77	$	43
Mortgage loans on real estate	—			—		—		—
Policy loans	1			1		2		2
Other equity investments	—			(2)		—		(3)
Trading securities	2			—		—		—
Other investment income	7			—		9		—
Gross investment income (loss)	58			21		88		42
Investment expenses	(2)			—		(3)		(1)
Net investment income (loss)	$	56		$	21	$	85	$	41

Investment Gains (Losses), Net

Investment gains (losses), net, including changes in the valuation allowances and credit losses are as follows:

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


	Three Months Ended June 30,		Six Months Ended June 30,
	2023			2022		2023		2022
	(in millions)
Fixed maturities	$	—		$	(2)	$	(5)	$	(3)
Mortgage loans on real estate	—			—		—		—
Other equity investments (1)	—			—		—		—

Investment gains (losses), net	$	—		$	(2)	$	(5)	$	(3)

_____________

(1) Investment gains (losses), net of Other equity investments includes Real Estate Held for production.

4) DERIVATIVES

The Company uses derivatives as part of its overall asset/liability risk management primarily to reduce exposures to equity market and interest rate risks. Derivative hedging strategies are designed to reduce these risks from an economic perspective and are all executed within the framework of a “Derivative Use Plan” approved by applicable states’ insurance law. The Company does not designate any derivatives as hedge accounting. Operation of these hedging programs is based on models involving numerous estimates and assumptions, including, among others, mortality, lapse, surrender and withdrawal rates, election rates, fund performance, market volatility and interest rates. A wide range of derivative contracts can be used in these hedging programs, including exchange traded equity and interest rate futures contracts as well as equity options. The derivative contracts are collectively managed in an effort to reduce the economic impact of unfavorable changes in guaranteed benefits’ exposures attributable to movements in capital markets.

Derivatives Utilized to Hedge Exposure to Variable Annuities with Guarantee Features

The Company has issued and continues to offer variable annuity products with GMxB features which are accounted for as market risk benefits. The risk associated with the GMDB feature is that under-performance of the financial markets could result in GMDB benefits, in the event of death, being higher than what accumulated policyholders’ account balances would support. The risk associated with the GMIB feature is that under-performance of the financial markets could result in the present value of GMIB, in the event of annuitization, being higher than what accumulated policyholders’ account balances would support, taking into account the relationship between current annuity purchase rates and the GMIB guaranteed annuity purchase rates. The risk associated with products that have a GMxB feature and are accounted for as market risk benefits is that under-performance of the financial markets could result in the GMxB features benefits being higher than what accumulated policyholders’ account balances would support.

For GMxB features, the Company retains certain risks including basis, credit spread and some volatility risk and risk associated with actual experience versus expected actuarial assumptions for mortality, lapse and surrender, withdrawal and policyholder election rates, among other things. The derivative contracts are managed to correlate with changes in the value of the GMxB features that result from financial markets movements.

Derivatives Utilized to Hedge Crediting Rate Exposure on SCS, SIO, MSO and IUL Products/Investment Options

The Company hedges crediting rates in the SCS, MSO in the variable life insurance products and IUL insurance products. These products permit the contract owner to participate in the performance of an index, ETF or commodity price movement up to a cap for a set period of time. They also contain a protection feature, in which the Company will

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

absorb, up to a certain percentage, the loss of value in an index, ETF or commodity price, which varies by product segment.

In order to support the returns associated with these features, the Company enters into derivative contracts whose payouts, in combination with fixed income investments, emulate those of the index, ETF or commodity price, subject to caps and buffers, thereby substantially reducing any exposure to market-related earnings volatility.

The tables below present quantitative disclosures about the Company’s derivative instruments, including those embedded in other contracts required to be accounted for as derivative instruments:

The following table presents the gross notional amount and estimated fair value of the Company’s derivatives:

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Derivative Instruments by Category


		March 31, 2023						December 31, 2022							June 30, 2023						December 31, 2022
				Fair Value						Fair Value							Fair Value						Fair Value
		Notional Amount		Derivative Assets		Derivative Liabilities		Notional Amount		Derivative Assets		Derivative Liabilities			Notional Amount		Derivative Assets		Derivative Liabilities		Notional Amount		Derivative Assets		Derivative Liabilities
		(in millions)													(in millions)

Derivatives: (1)	Derivatives: (1)													Derivatives: (1)
Equity contracts:	Equity contracts:													Equity contracts:
Futures	Futures	$	944	$	—	$	—	$	394	$	—	$	—	Futures	$	1,324	$	—	$	—	$	394	$	—	$	—

Options	Options	751		194		78		209		34		16		Options	1,948		546		167		209		34		16
Interest rate contracts:	Interest rate contracts:													Interest rate contracts:
Futures	Futures	306		—		—		282		—		—		Futures	370		—		—		282		—		—

Other contracts:	Other contracts:													Other contracts:
Margin	Margin	—		62		—		—		29		—		Margin	—		81		—		—		29		—
Collateral	Collateral	—		—		99		—		—		3		Collateral	—		—		346		—		—		3
Total:	Total:	2,001		256		177		885		63		19		Total:	3,642		627		513		885		63		19

Embedded derivatives:	Embedded derivatives:													Embedded derivatives:

MSO, SCS and IUL indexed features (2)		—		—		288		—		—		87
SCS, SIO, MSO and IUL indexed features (2)														SCS, SIO, MSO and IUL indexed features (2)	—		—		7,347		—		—		87
Funds withheld receivable (3)														Funds withheld receivable (3)	—		(136)		—		—		—		—
Modco receivable (2)														Modco receivable (2)	—		—		166		—		—		—
Total embedded derivatives	Total embedded derivatives	—		—		288		—		—		87		Total embedded derivatives	—		(136)		7,513		—		—		87
Total derivative instruments	Total derivative instruments	$	2,001	$	256	$	465	$	885	$	63	$	106	Total derivative instruments	$	3,642	$	491	$	8,026	$	885	$	63	$	106

______________

(1)Reported in other invested assets in the balance sheets.

(2)Reported in policyholders’ account balances in the balance sheets.

(3)Reported in funds withheld receivable in the balance sheets.

The following table presents the effects of derivative instruments on the statements of income and comprehensive income (loss).:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	Net Derivatives Gains (Losses)
	(in millions)
Derivatives:
Equity contracts:
Futures	$	70	$	(66)	$	98	$	(74)
Options	105		(3)		111		(3)
Interest rate contracts:
Futures	(12)		(12)		(4)		(24)








Total:	163		(81)		205		(101)

Embedded Derivatives:
SCS, SIO, MSO and IUL indexed features	(2,194)		78		(2,230)		90
Funds withheld receivable	(599)		—		(599)		—
Modco receivable	1,930		—		1,930		—
Total Embedded Derivatives	(863)		78		(899)		90

Total Derivatives instruments (1)	$	(700)	$	(3)	$	(694)	(11)

2024

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Three Months Ended March 31,
2023 2022
Net Derivatives
Gain (Losses) Net Derivatives
Gain (Losses)
(in millions)
Derivatives:
Equity contracts:
Futures $ 16 $ (9)
Options 6 —
Interest rate contracts:
Futures 20 (12)
Total: 42 (21)
Embedded derivatives:
MSO, SCS and IUL indexed features (36) 13
Total Embedded Derivatives (36) 13
Total Derivatives instruments (1) $ 6 $ (8)
________

~~______________~~

(1)Reported in net derivative gains (losses) in the statements of income (loss).

Equity-Based and Treasury Futures Contracts Margin

All outstanding equity-based futures contracts as of ~~March 31,~~June 30, 2023 and December 31, 2022 are exchange-traded and net settled daily in cash. As of ~~March 31,~~June 30, 2023 and December 31, 2022, respectively, the Company had open exchange-traded futures positions on: (i) the S&P 500, Nasdaq, Russell 2000 and Emerging Market indices, having initial margin requirements of ~~$52~~$67 million and $22 million and (ii) the 2-year, 5-year and 10-year U.S. Treasury Notes on U.S. Treasury bonds and ultra-long bonds, having initial margin requirements of ~~$11~~$14 million and $10 million.

Collateral Arrangements

The Company generally has executed a CSA under the ISDA Master Agreement it maintains with each of its OTC derivative counterparties that requires both posting and accepting collateral either in the form of cash or high-quality securities, such as U.S. Treasury securities, U.S. government and government agency securities and investment grade corporate bonds. The Company nets the fair value of all derivative financial instruments with counterparties for which an ISDA Master Agreement and related CSA have been executed. As of ~~March 31,~~June 30, 2023 and December 31, 2022, respectively, the Company held ~~$99~~$346 million and $3 million in cash and securities collateral delivered by trade counterparties, representing the fair value of the related derivative agreements. The unrestricted cash collateral is reported in other invested assets. The Company posted collateral of $0 million and $0 million as of ~~March 31,~~June 30, 2023 and December 31, 2022, respectively, in the normal operation of its collateral arrangements. The Company is exposed to losses in the event of non-performance by counterparties to financial derivative transactions with a positive fair value. The Company manages credit risk by: (i) entering into derivative transactions with highly rated major international financial institutions and other creditworthy counterparties governed by master netting agreements, as applicable; (ii) trading through central clearing and OTC parties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single party credit exposures which are subject to periodic management review.

Substantially all of the Company’s derivative agreements have zero thresholds which require daily full collateralization by the party in a liability position. In addition, certain of the Company’s derivative agreements contain credit-risk related contingent features; if the credit rating of one of the parties to the derivative agreement is to fall below a certain level, the party with positive fair value could request termination at the then fair value or demand immediate full collateralization from the party whose credit rating fell and is in a net liability position.

As of ~~March 31,~~June 30, 2023 and December 31, 2022, there were no net liability derivative positions with counterparties with credit risk-related contingent features whose credit rating has fallen. All derivatives have been appropriately collateralized by the Company or the counterparty in accordance with the terms of the derivative agreements.

The following tables presents information about the Company’s offsetting of financial assets and liabilities and derivative instruments as of June 30, 2023 and December 31, 2022:

Offsetting of Financial Assets and Liabilities and Derivative Instruments

As of June 30, 2023

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

~~The following tables presents information about the Company’s offsetting of financial assets and liabilities and derivative instruments as of March 31, 2023 and December 31, 2022:~~

~~Offsetting of Financial Assets and Liabilities and Derivative Instruments~~

~~As of March 31, 2023~~


		Gross Amount Recognized		Gross Amount Offset in the Balance Sheets		Net Amount Presented in the Balance Sheets		Gross Amount not Offset in the Balance Sheets (1)		Net Amount			Gross Amount Recognized		Gross Amount Offset in the Balance Sheets		Net Amount Presented in the Balance Sheets		Gross Amount not Offset in the Balance Sheets (1)		Net Amount
		(in millions)											(in millions)
Assets:	Assets:											Assets:
Derivative assets	Derivative assets	$	256	$	177	$	79	$	—	$	79	Derivative assets	$	627	$	513	$	114	$	—	$	114
Other financial assets	Other financial assets	3		—		3		—		3		Other financial assets	3		—		3		—		3
Other invested assets	Other invested assets	$	259	$	177	$	82	$	—	$	82	Other invested assets	$	630	$	513	$	117	$	—	$	117

Liabilities:	Liabilities:											Liabilities:
Derivative liabilities	Derivative liabilities	$	177	$	177	$	—	$	—	$	—	Derivative liabilities	$	513	$	513	$	—	$	—	$	—
Other financial liabilities	Other financial liabilities	182		—		182		—		182		Other financial liabilities	2,124		—		2,124		—		2,124
Other liabilities	Other liabilities	$	359	$	177	$	182	$	—	$	182	Other liabilities	$	2,637	$	513	$	2,124	$	—	$	2,124

______________

(1)Financial instruments sent (held).

As of December 31, 2022


	Gross Amount Recognized		Gross Amount Offset in the Balance Sheets		Net Amount Presented in the Balance Sheets		Gross Amount not Offset in the Balance Sheets (1)		Net Amount
	(in millions)
Assets:
Derivative assets	$	63	$	18	$	45	$	—	$	45
Other financial assets	2		—		2		—		2
Other invested assets	$	65	$	18	$	47	$	—	$	47

Liabilities:
Derivative liabilities	$	19	$	18	$	1	$	—	$	1
Other financial liabilities	72		—		72		—		72
Other liabilities	$	91	$	18	$	73	$	—	$	73

______________

(1)Financial instruments sent (held).

5) DAC AND OTHER DEFERRED ASSETS/LIABILITIES

Changes in the DAC asset for the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022 ~~were~~are as follows:

VUL (1) IUL (2) GMxB Core Investment
Edge SCS Total
(in millions)
Balance, beginning of the period $ 410 $ 296 $ 40 $ 1 $ 13 $ 760
Capitalization 17 3 9 5 42 76
Amortization (6) (4) (1) — (1) (12)
Balance, March 31, 2023 $ 421 $ 295 $ 48 $ 6 $ 54 $ 824


	Six Months Ended June 30, 2023
	VUL (1)		IUL (2)		GMxB Core		IE (3)		SCS		Total
	(in millions)
Balance, beginning of period	$	410	$	296	$	40	$	1	$	13	$	760
Capitalization	34		7		34		11		119		205
Amortization	(11)		(9)		(2)		—		(5)		(27)
Balance, end of period	$	433	$	294	$	72	$	12	$	127	$	938

______________

(1) “VUL” defined as Variable Universal Life.

(2) “IUL” defined as Indexed Universal Life.

(3) “IE” defined as Investment Edge.

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

VUL (1) IUL (2) GMxB Core Investment
Edge SCS Total
(in millions)
Balance, beginning of the period $ 361 $ 297 $ 14 $ — $ — $ 672
Capitalization 17 5 4 — — 26
Amortization (5) (5) — — — (10)
Balance, March 31, 2022 $ 373 $ 297 $ 18 $ — $ — $ 688


	Six Months Ended June 30, 2022
	VUL (1)		IUL (2)		GMxB Core		Total
	(in millions)
Balance, beginning of period	$	361	$	297	$	14	$	672
Capitalization	35		9		9		53
Amortization	(10)		(9)		(1)		(20)
Balance, end of period	$	386	$	297	$	22	$	705

______________

(1) “VUL” defined as Variable Universal Life.

(2) “IUL” defined as Indexed Universal Life.

~~Changes in the Sales Inducement Assets for the three months ended March 31, 2023 and 2022 were as follows:~~

Three Months Ended March 31,
2023 2022
GMxB Core
(in millions)
Balance, beginning of the period $ 1 $ —
Capitalization — —
Amortization — —
Balance, end of the period $ 1 $ —

Changes in the Unearned Revenue Liability for the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022 were as follows:

Three Months Ended March 31,
2023 2022
VUL IUL VUL IUL
(in millions)
Balance, beginning of the period $ 159 $ 157 $ 118 $ 94
Capitalization 13 17 12 18
Amortization (2) (3) (2) (2)
Balance, end of the period $ 170 $ 171 $ 128 $ 110


	Six Months Ended June 30,
	2023				2022
	VUL		IUL		VUL		IUL
	(in millions)
Balance, beginning of period	$	159	$	157	$	118	$	94
Capitalization	27		33		23		36
Amortization	(5)		(5)		(4)		(4)
Balance, end of period	$	181	$	185	$	137	$	126

The following table presents a reconciliation of DAC to the balance ~~sheet.~~sheet:

March 31, 2023 December 31, 2022
(in millions)
VUL $ 421 $ 410
IUL 295 296
GMxB Core 48 40
Investment Edge 6 1
SCS 54 13
Total $ 824 $ 760


	June 30, 2023		December 31, 2022
	(in millions)
VUL	$	433	$	410
IUL	294		296
GMxB Core	72		40
Investment Edge	12		1
SCS	127		13
Other	9		—
Total	$	947	$	760

Annually, or as circumstances warrant, we will review the associated decrements assumptions. (i.e. mortality and lapse) based on our multi-year average of companies experience with actuarial judgements to reflect other observable industry trends. In addition to DAC, the Unearned Revenue Liability and Sales Inducement Asset (“SIA”) use similar techniques and quarterly update processes for balance amortization.

6) FAIR VALUE DISCLOSURES

U.S. GAAP establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value, and identifies three levels of inputs that may be used to measure fair value:

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

Level 1 Unadjusted quoted prices for identical instruments in active markets. Level 1 fair values generally are supported by market transactions that occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar instruments, quoted prices in markets that are not active, and inputs to model-derived valuations that are directly observable or can be corroborated by observable market data.

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Level 3 Unobservable inputs supported by little or no market activity and often requiring significant management judgment or estimation, such as an entity’s own assumptions about the cash flows or other significant components of value that market participants would use in pricing the asset or liability.

The Company uses unadjusted quoted market prices to measure fair value for those instruments that are actively traded in financial markets. In cases where quoted market prices are not available, fair values are measured using present value or other valuation techniques. The fair value determinations are made at a specific point in time, based on available market information and judgments about the financial instrument, including estimates of the timing and amount of expected future cash flows and the credit standing of counterparties. Such adjustments do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument, nor do they consider the tax impact of the realization of unrealized gains or losses. In many cases, the fair value cannot be substantiated by direct comparison to independent markets, nor can the disclosed value be realized in immediate settlement of the instrument.

Management is responsible for the determination of the value of investments carried at fair value and the supporting methodologies and assumptions. Under the terms of various service agreements, the Company often utilizes independent valuation service providers to gather, analyze, and interpret market information and derive fair values based upon relevant methodologies and assumptions for individual securities. These independent valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of widely accepted valuation models, provide a single fair value measurement for individual securities for which a fair value has been requested. As further described below with respect to specific asset classes, these inputs include, but are not limited to, market prices for recent trades and transactions in comparable securities, benchmark yields, interest rate yield curves, credit spreads, quoted prices for similar securities, and other market-observable information, as applicable. Specific attributes of the security being valued also are considered, including its term, interest rate, credit rating, industry sector, and when applicable, collateral quality and other security- or issuer-specific information. When insufficient market observable information is available upon which to measure fair value, the Company either will request brokers knowledgeable about these securities to provide a non-binding quote or will employ internal valuation models. Fair values received from independent valuation service providers and brokers and those internally modeled or otherwise estimated are assessed for reasonableness.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Fair value measurements are required on a non-recurring basis for certain assets only when an impairment or other events occur. As of ~~March 31,~~June 30, 2023 and December 31, 2022, no assets or liabilities were required to be measured at fair value on a non-recurring basis.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis are summarized below.

2428

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Fair Value Measurements as of ~~March~~June 30, 2023


	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Investments:
Fixed maturities, AFS:
Corporate (1)	$	—	$	4,020	$	61	$	4,081
U.S. Treasury, government and agency	—		14		—		14
States and political subdivisions	—		43		—		43
Foreign governments	—		30		—		30
Residential mortgage-backed	—		411		—		411
Asset-backed (2)	—		1,076		—		1,076
Commercial mortgage-backed	—		149		—		149

Total fixed maturities, AFS	—		5,743		61		5,804
Other equity investments	20		18		—		38
Other invested assets:





Options	—		379		—		379
Total other invested assets	—		379		—		379
Cash equivalents	1,028		—		—		1,028
Funds withheld receivable (3) (5)	—		—		(136)		(136)
Purchased market risk benefits	—		—		10		10
Assets for market risk benefits	—		—		26		26
Separate Accounts assets (4)	4,501		7		—		4,508
Total Assets	$	5,549	$	6,147	$	(39)	$	11,657

Liabilities:
Policyholders’ account balances:	—		—		—		—
SCS, MSO and IUL indexed features’ liability	—		7,347		—		7,347
Modco payable (5)	—		—		166		166
Liabilities for market risk benefits	—		—		7,363		7,363
Total Liabilities	$	—	$	7,347	$	7,529	$	14,876

______________

(1)Corporate fixed maturities includes both public and private issues.

(2)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities and other asset types.

(3)As discussed in Note 2 to these Financial Statements, the funds withheld receivable was created through a funds withheld and modified coinsurance agreement where the investments supporting the reinsurance agreement are withheld by and continue to reside on Equitable Financial’s consolidated balance sheet. This embedded derivative is valued as a total return swap with references to the fair value of the invested assets held by the Equitable Financial, which are primarily AFS securities.

(4)Separate Accounts assets included in the fair value hierarchy exclude investments not fair valued including other assets of $1 million.

(5)The embedded derivative is partially reflected in funds withheld receivable and policyholders’ account balance. The portion within policyholders’ account balances relates to the non-insulated products assumed on a modified coinsurance basis and is reflected net of assumed liabilities on the balance sheet.

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Fair Value Measurements as of December 31, ~~2023~~

Level 1 Level 2 Level 3 Total
(in millions)
Assets:
Investments:
Fixed maturities, AFS:
Corporate (1) $ — $ 2,950 $ 37 $ 2,987
U.S. Treasury, government and agency — 14 — 14
States and political subdivisions — 43 — 43
Foreign governments — 31 — 31
Residential mortgage-backed — 7 — 7
Asset-backed (2) — 75 — 75
Commercial mortgage-backed — 68 — 68
Total fixed maturities, AFS — 3,188 37 3,225
Other equity investments — 18 — 18
Other invested assets:
Options — 116 — 116
Total other invested assets — 116

—

116
Cash equivalents 508 — — 508
Purchased market risk benefits — — 11 11
Assets for market risk benefits — — 17 17
Separate Accounts assets (3) 3,858 7 — 3,865
Total Assets $ 4,366 $ 3,329 $ 65 $ 7,760
Liabilities:
MSO and IUL indexed features’ liability — 288 — 288
Liabilities for market risk benefits — — 14 14
Total Liabilities $ — $ 288 $ 14 $ 302
2022


	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Investments:
Fixed maturities, AFS:
Corporate (1)	$	—	$	2,040	$	18	$	2,058
U.S. Treasury, government and agency	—		14		—		14
States and political subdivisions	—		34		—		34
Residential mortgage-backed	—		6		—		6
Asset-backed (2)	—		41		—		41
Commercial mortgage-backed	—		65		—		65

Total fixed maturities, AFS	—		2,200		18		2,218
Other equity investments	—		19		—		19
Other invested assets:





Options	—		18		—		18
Total other invested assets	—		18		—		18
Cash equivalents	272		—		—		272
Funds withheld receivable	—		—		—		—
Purchased market risk benefits	—		—		13		13
Assets for market risk benefits	—		—		12		12
Separate Accounts assets (3)	3,367		7		—		3,374
Total Assets	$	3,639	$	2,244	$	43	$	5,926

Liabilities:
Policyholders’ account balances	—		—		—		—
SCS, SIO, MSO and IUL indexed features’ liability	—		87		—		87
Modco receivable	—		—		—		—
Liabilities for market risk benefits	—		—		15		15
Total Liabilities	$	—	$	87	$	15	$	102

______________

(1)Corporate fixed maturities includes both public and private issues.

(2)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities and other asset types.

(3)Separate Accounts assets included in the fair value hierarchy exclude investments not fair valued including other assets of $2$1 million.

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

~~Fair Value Measurements as of December 31, 2022~~
Level 1 Level 2 Level 3 Total
(in millions)
Assets:
Investments:
Fixed maturities, AFS:
Corporate (1) $ — $ 2,040 $ 18 $ 2,058
U.S. Treasury, government and agency — 14 — 14
States and political subdivisions — 34 — 34
Residential mortgage-backed — 6 — 6
Asset-backed (2) — 41 — 41
Commercial mortgage-backed — 65 — 65
Total fixed maturities, AFS — 2,200 18 2,218
Other equity investments — 19 — 19
Options — 18 — 18
Total other invested assets — 18 — 18
Cash equivalents 272 — — 272
Purchased market risk benefits — — 13 13
Assets for market risk benefits — — 12 12
Separate Accounts assets 3,367 7 — 3,374
Total Assets $ 3,639 $ 2,244 $ 43 $ 5,926
Liabilities:
MSO and IUL indexed features’ liability — 87 — 87
Liabilities for market risk benefits — — 15 15
Total Liabilities $ — $ 87 $ 15 $ 102

~~______________~~

~~(1)Corporate fixed maturities includes both public and private issues.~~

~~(2)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities and other asset types.~~

Public Fixed Maturities

The fair values of the Company’s public fixed maturities are generally based on prices obtained from independent valuation service providers and for which the Company maintains a vendor hierarchy by asset type based on historical pricing experience and vendor expertise. Although each security generally is priced by multiple independent valuation service providers, the Company ultimately uses the price received from the independent valuation service provider highest in the vendor hierarchy based on the respective asset type, with limited exception. To validate reasonableness, prices also are internally reviewed by those with relevant expertise through comparison with directly observed recent market trades. Consistent with the fair value hierarchy, public fixed maturities validated in this manner generally are reflected within Level 2, as they are primarily based on observable pricing for similar assets and/or other market observable inputs.

Private Fixed Maturities

The fair values of the Company’s private fixed maturities are determined from prices obtained from independent valuation service providers. Prices not obtained from an independent valuation service provider are determined by using a discounted cash flow model or a market comparable company valuation technique. In certain cases, these models use observable inputs with a discount rate based upon the average of spread surveys collected from private market intermediaries who are active in both primary and secondary transactions, taking into account, among other

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

factors, the credit quality and industry sector of the issuer and the reduced liquidity associated with private placements. Generally, these securities have been reflected within Level 2. For certain private fixed maturities, the discounted cash flow model or a market comparable company valuation technique may also incorporate unobservable inputs, which reflect the Company’s own assumptions about the inputs market participants would use in pricing the asset. To the extent management determines that such unobservable inputs are significant to the fair value measurement of a security, a Level 3 classification generally is made.

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

Freestanding Derivative Positions

The net fair value of the Company’s freestanding derivative positions as disclosed in Note 4 of the Notes to these Financial Statements are generally based on prices obtained either from independent valuation service providers or derived by applying market inputs from recognized vendors into industry standard pricing models. The majority of these derivative contracts are traded in the OTC derivative market and are classified in Level 2. The fair values of derivative assets and liabilities traded in the OTC market are determined using quantitative models that require use of the contractual terms of the derivative instruments and multiple market inputs, including interest rates, prices, and indices to generate continuous yield or pricing curves, including overnight index swap curves, and volatility factors, which then are applied to value the positions. The predominance of market inputs is actively quoted and can be validated through external sources or reliably interpolated if less observable.

Funds withheld receivable

Reinsurance agreements written on a funds withheld or modified coinsurance basis contain embedded derivatives. This embedded derivative is valued as a total return swap with reference to the fair value of the invested assets held by Equitable Financial. Accordingly, the unobservable inputs utilized in the valuation of the embedded derivative are a component of the invested assets supporting the reinsurance agreements that are held on Equitable Financial’s consolidated balance sheet.

Level Classifications of the Company’s Financial Instruments

Financial Instruments Classified as Level 1

Investments classified as Level 1 primarily include redeemable preferred stock, trading securities, cash equivalents and Separate Accounts assets. Fair value measurements classified as Level 1 include exchange-traded prices of fixed maturities, equity securities and derivative contracts, and net asset values for transacting subscriptions and redemptions of mutual fund shares held by Separate Accounts. Cash equivalents classified as Level 1 include money market accounts, overnight commercial paper and highly liquid debt instruments purchased with an original maturity of three months or less and are carried at cost as a proxy for fair value measurement due to their short-term nature.

Financial Instruments Classified as Level 2

Investments classified as Level 2 are measured at fair value on a recurring basis and primarily include U.S. government and agency securities and certain corporate debt securities, such as public and private fixed maturities. As market quotes generally are not readily available or accessible for these securities, their fair value measures are determined utilizing relevant information generated by market transactions involving comparable securities and often are based on model pricing techniques that effectively discount prospective cash flows to present value using appropriate sector-adjusted credit spreads commensurate with the security’s duration, also taking into consideration issuer-specific credit quality and liquidity.

Observable inputs generally used to measure the fair value of securities classified as Level 2 include benchmark yields, reported secondary trades, issuer spreads, benchmark securities and other reference data. Additional observable inputs are used when available, and as may be appropriate, for certain security types, such as prepayment, default, and collateral information for the purpose of measuring the fair value of mortgage- and asset-backed securities. The Company’s AAA-rated mortgage- and asset-backed securities are classified as Level 2 for which the observability of market inputs to their pricing models is supported by sufficient, albeit more recently contracted, market activity in these sectors.

Certain Company products, such as IUL and the MSO fund available in some life contracts offer investment options which permit the contract owner to participate in the performance of an index, ETF or commodity price. These investment options, which depending on the product and on the index selected can currently have one, three, five or six year terms, provide for participation in the performance of specified indices, ETF or commodity price movement up to a segment-specific declared maximum rate. Under certain conditions that vary by product, e.g., holding these segments

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

for the full term, these segments also shield policyholders from some or all negative investment performance associated with these indices, ETF or commodity prices. These investment options have defined formulaic liability amounts, and the current values of the option component of these segment reserves are accounted for as Level 2 embedded derivatives. The fair values of these embedded derivatives are based on data obtained from independent valuation service providers.

Financial Instruments Classified as Level 3

The Company’s investments classified as Level 3 primarily include corporate debt securities, such as private fixed maturities and asset-backed securities. Determinations to classify fair value measures within Level 3 of the valuation hierarchy generally are based upon the significance of the unobservable factors to the overall fair value measurement. Included in the Level 3 classification are fixed maturities with indicative pricing obtained from brokers that otherwise could not be corroborated to market observable data.

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

The Company has certain variable annuity contracts with GMDB, GMIB, GIB and GWBL and other features in-force that guarantee one of the following:

•Return of Premium: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals);

•Ratchet: the benefit is the greatest of current account value, premiums paid (adjusted for withdrawals), or the highest account value on any anniversary up to contractually specified ages (adjusted for withdrawals);

•Roll-Up: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals) accumulated at contractually specified interest rates up to specified ages;

•Combo: the benefit is the greater of the ratchet benefit or the roll-up benefit, which may include either a five year or an annual reset; or

•Withdrawal: the withdrawal is guaranteed up to a maximum amount per year for life.

The Company also issues certain benefits on its variable annuity products that are accounted for as market risk benefits carried at fair value and are also considered Level 3 for fair value leveling.

The GMIBNLG feature allows the policyholder to receive guaranteed minimum lifetime annuity payments based on predetermined annuity purchase rates applied to the contract’s benefit base if and when the contract account value is depleted and the NLG feature is activated. The optional GMIB feature allows the policyholder to receive guaranteed minimum lifetime annuity payments based on predetermined annuity purchase rates.

The GMWB feature allows the policyholder to withdraw at minimum, over the life of the contract, an amount based on the contract’s benefit base. The GWBL feature allows the policyholder to withdraw, each year for the life of the contract, a specified annual percentage of an amount based on the contract’s benefit base. The GMAB feature increases the contract account value at the end of a specified period to a GMAB base. The GIB feature provides a lifetime annuity based on predetermined annuity purchase rates if and when the contract account value is depleted.

This lifetime annuity is based on predetermined annuity purchase rates applied to a GIB base. The GMDB feature guarantees that the benefit paid upon death will not be less than a guaranteed benefit base. If the contract’s account value is less than the benefit base at the time a death claim is paid, the amount payable will be equal to the benefit base.

Purchased MRB assets, which are accounted for as market risk benefits carried at fair value are also considered Level 3 for fair value leveling. The Purchased MRB asset fair value reflects the present value of reinsurance premiums, net of recoveries, adjusted for risk margins and nonperformance risk over a range of market consistent economic scenarios while the MRB asset and liability reflects the present value of expected future payments (benefits) less fees, adjusted for risk margins and nonperformance risk, attributable to the MRB asset and liability over a range of market-consistent economic scenarios.

The valuations of the Purchased MRB assets incorporate significant non-observable assumptions related to policyholder behavior, risk margins and projections of equity Separate Accounts funds. The credit risks of the counterparty and of the Company are considered in determining the fair values of its Purchased MRB asset after taking into account the effects of collateral arrangements. Incremental adjustment to the risk free curve for counterparty non-performance risk is made to the fair values of the Purchased MRB assets. Risk margins were applied to the non-capital markets inputs to the Purchased MRB valuations.

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

The Company also issues certain benefits on its variable annuity products that are accounted for as market risk benefits carried at fair value and are also considered Level 3. See Note 8 of the Notes to these Financial Statements for further description of our market risk benefits fair value.

The funds withheld embedded derivative receivable is determined based upon a total return swap technique referencing the fair value of the investments held under the reinsurance contract as collateral and requires certain unobservable inputs. The funds withheld embedded derivative are considered Level 3 in the fair value hierarchy.

Transfers of Financial Instruments Between Levels 2 and 3

During the ~~three~~six months ended ~~March 31,~~June 30, 2023, there were $10 million AFS fixed maturities transferred out of Level 3 and into Level 2 and no AFS fixed maturities transferred out of Level 2 and into Level 3. These transfers in the aggregate represent approximately ~~2.7%~~0.7% of total equity as of ~~March 31,~~June 30, 2023.

During the ~~three~~six months ended ~~March 31,~~June 30, 2022, there were no$5 million AFS fixed maturities transferred ~~from~~out of Level 3 and into Level 2 ~~into Level 3 classification and no~~or AFS fixed maturities transferred ~~from~~out of Level 32 and into Level 2.3. These transfers in the aggregate represent approximately 1.7% of total equity as of June 30, 2022.

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

The tables below present reconciliations for Level 3 assets and liabilities and changes in unrealized gains (losses) for the three and six months ended ~~March 31,~~June 30, 2023 and 2022, respectively. Not included below are the changes in balances related to market risk benefits and purchased market risk benefits level 3 assets and liabilities, which are included in Note 8 of the Notes to these Financial Statements.

Level 3 Instruments - Fair Value Measurements


	Three Months Ended June 30, 2023						Three Months Ended June 30, 2022
	Corporate		Funds Withheld Receivable		Modco Payable		Corporate		Funds Withheld Receivable		Modco Payable
	(in millions)
Balance, beginning of period	$	37	$	—	$	—	$	11	$	—	$	—
Realized and unrealized gains (losses), included in Net income (loss) as:
Investment gains (losses), reported in net investment income	—		—		—		—		—		—
Net derivative gains (losses) (1)	—		(136)		166		—		—		—
Total realized and unrealized gains (losses)	—		(136)		166		—		—		—
Other comprehensive income (loss)	—		—		—		—		—		—
Purchases	24		—		—		11		—		—
Sales	—		—		—		(1)		—		—
Transfers into Level 3 (1)	—		—		—		—		—		—
Transfers out of Level 3 (1)	—		—		—		(5)		—		—
Balance, end of period	$	61	$	(136)	$	166	$	16	$	—	$	—
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period	$	—	$	—	$	—	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period.	$	—	$	—	$	—	$	—	$	—	$	—


	~~Corporate~~
	~~(in millions)~~
~~Balance, January 1, 2023~~	$	18
~~Realized and unrealized gains (losses), included in Net income (loss) as:~~
~~Investment gains (losses), reported in net investment income~~	—
~~Net derivative gains (losses) (1)~~	—
~~Total realized and unrealized gains (losses)~~	—
~~Other comprehensive income (loss)~~	—
~~Purchases~~	29
~~Sales~~	—
~~Transfers into Level 3 (1)~~	—
~~Transfers out of Level 3 (1)~~	~~(10)~~
~~Balance, March 31, 2023~~	$	37
~~Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period~~	$	—
~~Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period.~~	$	—

~~Balance, January 1, 2022~~	$	11

~~Realized and unrealized gains (losses), included in Net income (loss) as:~~
~~Investment gains (losses), reported in net investment income~~	—
~~Net derivative gains (losses) (1)~~	—
~~Total realized and unrealized gains (losses)~~	—
~~Other comprehensive income (loss)~~	~~(1)~~
~~Purchases~~	1
~~Sales~~	—
~~Transfers into Level 3 (1)~~	—
~~Transfers out of Level 3 (1)~~	—
~~Balance, March 31, 2022~~	$	11
~~Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period~~	$	—
~~Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period~~	$	~~(1)~~

~~____________~~

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


	Six Months Ended June 30, 2023						Six Months Ended June 30, 2022
	Corporate		Funds Withheld Receivable		Modco Payable		Corporate		Funds Withheld Receivable		Modco Payable
	(in millions)
Balance, beginning of period	$	18	$	—	$	—	$	11	$	—	$	—
Realized and unrealized gains (losses), included in Net income (loss) as:
Investment gains (losses), reported in net investment income	—		—		—		—		—		—
Net derivative gains (losses) (1)	—		(136)		166		—		—		—
Total realized and unrealized gains (losses)	—		(136)		166		—		—		—
Other comprehensive income (loss)	—		—		—		(1)		—		—
Purchases	53		—		—		12		—		—
Sales	—		—		—		(1)		—		—
Transfers into Level 3 (1)	—		—		—		—		—		—
Transfers out of Level 3 (1)	(10)		—		—		(5)		—		—
Balance, end of period	$	61	$	(136)	$	166	$	16	$	—	$	—
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period	$	—	$	—	$	—	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period.	$	—	$	—	$	—	$	(1)	$	—	$	—

____

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

Quantitative and Qualitative Information about Level 3 Fair Value Measurements

The following tables disclose quantitative information about Level 3 fair value measurements by category for assets and liabilities as of ~~March 31,~~June 30, 2023 and December 31, 2022, ~~respectively.~~

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

respectively:

Quantitative Information about Level 3 Fair Value Measurements as of ~~March 31,~~June 30, 2023

Fair
Value

Valuation Technique

Significant
Unobservable Input

Range

Weighted Average

(Dollars in millions)

Assets:(4)

Investments:

Fixed maturities, AFS:

Corporate

732

Matrix pricing
model

Spread over ~~Benchmark~~benchmark

20 bps - ~~245~~320 bps

~~147~~65 bps

Purchased MRB asset (1)

1110

Discounted cash flow

Lapse rates

Withdrawal rates

Annuitization rates

Non-performance risk (bps)

Mortality: Ages 0-40

Ages 41-60

Ages 61-115

N/A

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Fair
Value

Valuation Technique

Significant
Unobservable Input

Range

Weighted Average

(Dollars in millions)

Liabilities:

Direct MRB (1) (2) (3)

7,337

Discounted cash flow

Non-performance risk (bps)

Lapse rates

Withdrawal rates

Annuitization rates

Mortality: Ages 0-40

Ages 41-60

Ages 61-115

~~191~~55 bps - 192 bps

~~0.35%~~0.26% - 35.42%

~~0.20%~~0.00% - ~~1.24%~~10.93%

0.04% - 100.00%

0.01% - 0.17%

0.06% - 0.52%

0.32% - 40.00%

~~191~~55 bps

~~4.08%~~3.81%

~~1.10%~~0.65%

~~2.94%~~3.13%

~~0.96%~~2.56%

(same for all ages)

(1)Lapses and pro-rata withdrawal rates were developed as a function of the policy account value. Dollar for dollar withdrawal rates were developed as a function of the dollar for dollar threshold, the dollar for dollar limit. GMIB utilization rates were developed as a function of the GMIB benefit base.

(2)MRB assets are shown net of MRB liabilities. Net amount is made up of ~~$17~~$26 million of MRB assets and ~~$14~~$7,363 million of MRB liabilities.

(3)Includes Core products.

(4)Funds withheld receivable that contain embedded derivatives held at fair value are excluded from the tables above. The funds withheld receivable embedded derivative utilizes a total return swap technique which incorporates the fair value of the invested assets supporting the reinsurance agreement as a component of the valuation.

Quantitative Information about Level 3 Fair Value Measurements as of December 31, 2022

Fair

Value

Valuation Technique

Significant

Unobservable Input

Range

Weighted Average

(Dollars in millions)

Assets:

Investments:

Fixed maturities, AFS:

Corporate

Matrix pricing model

Spread over benchmark

245 bps - 245 bps

245 bps

Purchased MRB asset (1) (2) (4)

Discounted cash flow

Lapse rates

Withdrawal rates

Annuitization

Non-performance risk (bps)

Mortality: Ages 0-40

Ages 41-60

Ages 61-115

N/A

Liabilities:

Direct MRB (1) (2) (3) (4)

Discounted cash flow

Non-performance risk

Lapse rates

Withdrawal rates

Annuitization rates

Mortality: Ages 0-40

Ages 41-60

Ages 61-115

157 bps

0.35% - 35.42%

0.20% - 1.24%

0.04% - 100.00%

0.01% - 0.17%

0.06% - 0.52%

0.32% - 40.00%

157 bps

4.35%

1.22%

3.27%

1.08%

(same for all ages)

(1)Mortality rates vary by age and demographic characteristic such as gender. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives.

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

(2)Lapses and pro-rata withdrawal rates were developed as a function of the policy account value. Dollar for dollar withdrawal rates were developed as a function of the dollar for dollar threshold, the dollar for dollar limit. GMIB utilization rates were developed as a function of the GMIB benefit base.

(3)MRB liabilities are shown net of MRB assets. Net amount is made up of $15 million of MRB liabilities and $12 million of MRB assets.

(4)Includes Core products.

Level 3 Financial Instruments for which Quantitative Inputs are Not Available

Certain Privately Placed Debt Securities with Limited Trading Activity

Excluded from the tables above as of ~~March 31,~~June 30, 2023 and December 31, 2022, respectively, are approximately ~~$30~~$29 million and $14 million of Level 3 fair value measurements of investments for which the underlying quantitative inputs are not developed by the Company and are not readily available. These investments primarily consist of certain

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

privately placed debt securities with limited trading activity, and their fair values generally reflect unadjusted prices obtained from independent valuation service providers and indicative, non-binding quotes obtained from third-party broker-dealers recognized as market participants. Significant increases or decreases in the fair value amounts received from these pricing sources may result in the Company’s reporting significantly higher or lower fair value measurements for these Level 3 investments.

•The fair value of private placement securities is determined by application of a matrix pricing model or a market comparable company value technique. The significant unobservable input to the matrix pricing model valuation technique is the spread over the industry-specific benchmark yield curve. Generally, an increase or decrease in spreads would lead to directionally inverse movement in the fair value measurements of these securities. The significant unobservable input to the market comparable company valuation technique is the discount rate. Generally, a significant increase (decrease) in the discount rate would result in significantly lower (higher) fair value measurements of these securities.

Market Risk Benefits

Significant unobservable inputs with respect to the fair value measurement of the Purchased MRB assets and ~~the~~ MRB liabilities identified in the table above are developed using Company data. Future ~~Policyholder~~policyholder behavior is an unobservable market assumption and as such all aspects of ~~policy holder~~policyholder behavior are derived based on recent historical experience. These policyholder behaviors include lapses, pro-rata withdrawals, dollar for dollar withdrawals, GMIB utilization, deferred mortality and payout phase mortality. Many of these policyholder behaviors have dynamic adjustment factors based on the relative value of the rider as compared to the account value in different economic environments. This applies to all variable annuity related products; products with GMxB riders including but not limited to GMIB, GMDB and GWL.

Lapse rates are adjusted at the contract level based on a comparison of the value of the embedded GMxB rider and the current policyholder account value, which include other factors such as considering surrender charges. Generally, lapse rates are assumed to be lower in periods when a surrender charge applies. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse. For valuing Purchased MRB assets and MRB liabilities, lapse rates vary throughout the period over which cash flows are projected.

Carrying Value of Financial Instruments Not Otherwise Disclosed in Note 3 and Note 4 of Notes to Financial Statements

The carrying values and fair values as of ~~March 31,~~June 30, 2023 and December 31, 2022 for financial instruments not otherwise disclosed in Note 3 and Note 4 of the Notes to these Financial Statements are presented in the table below.

3136

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Carrying Values and Fair Values for Financial Instruments Not Otherwise Disclosed


		Carrying Value		Fair Value									Carrying Value		Fair Value
				Level 1		Level 2		Level 3		Total					Level 1		Level 2		Level 3		Total
		(in millions)											(in millions)
March 31, 2023:
June 30, 2023:												June 30, 2023:
Mortgage loans on real estate	Mortgage loans on real estate	$	17	$	—	$	—	$	15	$	15	Mortgage loans on real estate	$	17	$	—	$	—	$	15	$	15
Policy loans	Policy loans	$	250	$	—	$	—	$	259	$	259	Policy loans	$	260	$	—	$	—	$	265	$	265

Funds withheld receivable												Funds withheld receivable	$	10,751	$	—	$	—	$	10,751	$	10,751
Modco receivable												Modco receivable	$	30,022	$	—	$	—	$	30,022	$	30,022
Policyholders’ liabilities: Investment contracts	Policyholders’ liabilities: Investment contracts	$	112	$	—	$	—	$	104	$	104	Policyholders’ liabilities: Investment contracts	$	110	$	—	$	—	$	101	$	101

Separate Accounts liabilities												Separate Accounts liabilities	$	267	$	—	$	—	$	267	$	267

December 31, 2022:	December 31, 2022:											December 31, 2022:
Mortgage loans on real estate	Mortgage loans on real estate	$	17	$	—	$	—	$	15	$	15	Mortgage loans on real estate	$	17	$	—	$	—	$	15	$	15
Policy loans	Policy loans	$	244	$	—	$	—	$	248	$	248	Policy loans	$	244	$	—	$	—	$	248	$	248

Funds withheld receivable												Funds withheld receivable	$	—	$	—	$	—	$	—	$	—
Modco receivable												Modco receivable	$	—	$	—	$	—	$	—	$	—
Policyholders’ liabilities: Investment contracts	Policyholders’ liabilities: Investment contracts	$	115	$	—	$	—	$	106	$	106	Policyholders’ liabilities: Investment contracts	$	115	$	—	$	—	$	106	$	106

Separate Accounts liabilities												Separate Accounts liabilities	$	—	$	—	$	—	$	—	$	—

Mortgage Loans on Real Estate

Fair values for commercial mortgage loans on real estate are measured by discounting future contractual cash flows to be received on the mortgage loan using interest rates at which loans with similar characteristics and credit quality would be made. The discount rate is derived based on the appropriate U.S. Treasury rate with a like term to the remaining term of the loan to which a spread reflective of the risk premium associated with the specific loan is added. Fair values for mortgage loans anticipated to be foreclosed and problem mortgage loans are limited to the fair value of the underlying collateral, if lower.

Policy Loans

The fair value of policy loans is calculated by discounting expected cash flows based upon the U.S. Treasury yield curve and historical loan repayment patterns.

Policyholder Liabilities - Investment Contracts and Separate Account Liabilities

The fair values for deferred annuities and certain annuities, which are included in policyholders’ account balances and liabilities for investment contracts with fund investments in Separate Accounts are estimated using projected cash flows discounted at rates reflecting current market rates. Significant unobservable inputs reflected in the cash flows include lapse rates and withdrawal rates. Incremental adjustments may be made to the fair value to reflect non-performance risk. Certain other products such as the Company’s association plans contracts, supplementary contracts not involving life contingencies, Access Accounts and Escrow Shield Plus product reserves are held at book value.

Financial Instruments Exempt from Fair Value Disclosure or Otherwise Not Required to be Disclosed

Exempt from Fair Value Disclosure Requirements

Certain financial instruments are exempt from the requirements for fair value disclosure, such as insurance liabilities other than financial guarantees.

7) LIABILITIES FOR FUTURE POLICYHOLDER BENEFITS

The following ~~table provides the balance,~~tables summarize balances and changes in the liability for future policy benefits for nonparticipating traditional and ~~the weighted average durations of the additional insurance liabilities~~limited pay contracts for the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022.

The payout annuities result from annuitization of current contracts. Inflows are the liquidation of the account values not premiums:

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

March 31, 2023 March 31, 2022
Universal Life Universal Life
(Dollars in millions)
Balance, beginning of the period $ 58 $ 57
Beginning balance before AOCI adjustments 66 55
Effect of changes in interest rate and cash flow assumptions and model changes — —
Effect of actual variances from expected experience (1) (1)
Adjusted beginning of period balance 65 54
Interest accrual 1 1
Net assessments collected 2 2
Benefit payments — —
Ending balance before shadow reserve adjustments 68 57
Effect of shadow reserve adjustment (6) (2)
Balance, end of the period $ 62 $ 55
Net liability for additional liability $ 62 $ 55
Effect of reserve adjustment recorded in AOCI — —
Net liability for additional liability, after reinsurance recoverable $ 62 $ 55
—
Weighted-average duration of additional liability - death benefit (years) 32.3 33.9

~~The following tables provides the revenue, interest and weighted average interest rates, related to the additional insurance liabilities for the three months ended and as of March 31, 2023 and 2022.~~


	Six Months Ended June 30, 2022
	2023		2022
	Payout-Legacy
	(in millions)
Present Value of Expected Future Policy Benefits
Balance, beginning of period	$	—	$	—
Beginning balance of original discount rate	—		—
Effect of changes in cash flow assumptions	—		—
Effect of actual variances from expected experience	—		—
Adjusted beginning of period balance	—		—
Issuances	120		—
Interest accrual	—		—
Benefits payments	—		—
Ending balance at original discount rate	120		—
Effect of changes in discount rate assumptions	(1)		—
Balance, end of period	$	119	$	—

Net liability for future policy benefits	$	119	$	—
Less: Reinsurance recoverable	—		—
Net liability for future policy benefits, after reinsurance recoverable	$	119	$	—

Weighted-average duration of liability for future policyholder benefits (years)	7.6		0

Three Months Ended March 31,
2023 2022 2023 2022
Assessments Interest Accretion
(in million)
Revenue and Interest Accretion
Universal Life $ 5 $ 4 $ — $ 1
Total $ 5 $ 4 $ — $ 1

March 31,
2023 2022
Weighted Average Interest Rate
Universal Life 5.5 % 5.5 %
Interest accretion rate 5.5 % 5.5 %

The following table reconciles the net liability for future policy benefits and liability of death benefits to the liability for future policy benefits in the balance sheet as of ~~March 31,~~June 30, 2023 and December 31, ~~2022.~~2022:

March 31, 2023 December 31, 2022
(in millions)
Reconciliation
Universal Life - additional liability for death benefits $ 62 $ 58
Other (1) 230 220
Future policyholder benefits total 292 278
Other policyholder liabilities 415 391
Total $ 707 $ 669


	June 30, 2023
	(in millions)
Reconciliation
Payout - Legacy	$	119
UL (1)	322
Other (2)	308
Subtotal	749
Other policy funds	460
Grand total	$	1,209

______________

(1)Represents the SOP NLG Rider on UL contracts assumed from Equitable Financial.

(2)Primarily ~~reflects Future~~future policy benefits related to Protective Life & Annuity and Employee Benefits.


	December 31, 2022
	(in millions)
Reconciliation
Universal Life (1)	$	58
Other (2)	220
Future policyholder benefits, total	278
Other policyholder liabilities	391
Total	$	669

______________

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

(1)Represent the SOP LTC Rider on all Universal Life contracts inclusive of VL and UL sold by the Company. Subsequent to the Internal Reinsurance Transaction described further in Note 1, these are no longer material and are not disclosed separately.

(2)Primarily future policy benefits related to Protective Life & Annuity and Employee Benefits.

The following table provides the amount of undiscounted and discounted expected gross premiums and expected future benefits and expenses related to nonparticipating traditional and limited payment contracts as of June 30, 2023 and December 31, 2022:


	June 30, 2023		December 31, 2022
	(in millions)
Payout-Legacy
Expected future benefit payments and expenses (undiscounted)	$	174	$	—
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted)	117		—
Expected future gross premiums (discounted)	—		—

The following tables provides the revenue, interest and weighted average interest rates, related to the additional insurance liabilities for the six months ended June 30, 2023 and 2022:


	Six Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	Gross Premium				Interest Accretion
	(in millions)
Revenue and Interest Accretion
Payout - Legacy (1)	$	21	$	—	$	—	$	—
Total	$	21	$	—	$	—	$	—

(1) Gross premium reflected is the liquidation of Account Value at time of annuitization.

The following table provides the weighted average interest rates for the liability for future policy benefits as of June 30, 2023 and December 31, 2022:


	June 30, 2023		December 31, 2022
Weighted Average Interest Rate
Payout-Legacy
Interest accretion rate	5.5	%	—	%
Current discount rate	5.6	%	—	%

The following table provides the balance, changes in and the weighted average durations of the additional insurance liabilities for the six months ended June 30, 2023 and 2022:

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


	Six Months Ended June 30,
		2023		2022
	UL (1)	Universal Life (2)
		(Dollars in millions)
Balance, beginning of period		$	—	$	57
Beginning balance before AOCI adjustments		—		55
Effect of changes in interest rate and cash flow assumptions and model changes		—		—
Effect of actual variances from expected experience		—		(1)
Adjusted beginning of period balance		—		54
Issuances (3)		322		—
Interest accrual		—		1
Net assessments collected		—		5
Benefit payments		—		—

Ending balance before shadow reserve adjustments		322		60
Effect of shadow reserve adjustment		—		(7)
Balance, end of period		$	322	$	53

Net liability for additional liability		$	322	$	53
Effect of reserve adjustment recorded in AOCI		—		—
Net liability for additional liability, after reinsurance recoverable		$	322	$	53

Weighted-average duration of additional liability - death benefit (years)		18.6		33.5

______________

(1)The 2023 additional insurance liabilities represent the SOP NLG Rider on UL contracts assumed from Equitable Financial.

(2)The 2022 additional insurance liabilities represent the SOP LTC Rider on all Universal Life contracts inclusive of VL and UL sold by the Company. Subsequent to the Reinsurance Treaty described further in Note 1, these are no longer material and are not disclosed separately.

(3)Issuances represent the UL SOP NLG business assumed from Equitable Financial on April 1, 2023.

The following tables provides the revenue, interest and weighted average interest rates, related to the additional insurance liabilities for the six months ended June 30, 2023 and 2022.


	Six Months Ended June 30, 2023
	Assessments		Interest Accretion
	(in millions)
Revenue and Interest Accretion
UL (1)	$	258	$	4
Total	$	258	$	4

_____________

(1)The 2023 additional insurance liabilities represent the SOP NLG Rider on UL contracts assumed from Equitable Financial.


	Six Months Ended June 30, 2022
	Assessments		Interest Accretion

Revenue and Interest Accretion
Universal Life	9		1
Total	$	9	$	1

___________

(1)The 2022 additional insurance liabilities represent the SOP LTC Rider on all Universal Life contracts inclusive of VL and UL sold by the Company. Subsequent to the Reinsurance Treaty described further in Note 1, these are no longer material and are not disclosed separately.

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


	Six Months Ended June 30,
		2023		2022
Weighted Average Interest Rate
Universal Life		4.5	%	5.5	%
Interest accretion rate		4.5	%	5.5	%

8) MARKET RISK BENEFITS

The following table presents the balances and changes to the balances for the market risk benefits for the GMxB benefits on deferred variable annuities for the three and six months ended ~~and as of March 31,~~June 30, 2023 and ~~2022.~~2022:


	Three Months Ended June 30,
	2023				2022
	GMxB Core		GMxB Legacy		GMxB Core		GMxB Legacy
	(Dollars in millions)
Balance, beginning of period	$	(14)	$	—	$	(7)	$	—
Balance BOP before changes in the instrument specific credit risk	(8)		—		(2)		—
Model changes and effect of changes in cash flow assumptions	—		—		—		—
Actual market movement effect	(108)		(264)		10		—
Interest accrual	9		68		—		—
Attributed fees accrued (1)	101		95		1		—
Benefit payments	(12)		(153)		—		—
Actual policyholder behavior different from expected behavior	6		(4)		1		—
Changes in future economic assumptions	(224)		(364)		(12)		—
Issuances (2)	1,292		6,865		—		—
Balance EOP before changes in the instrument-specific credit risk	1,056		6,243		(2)		—
Changes in the instrument-specific credit risk (3)	(9)		(6)		(8)		—
Balance, end of period	$	1,047	$	6,237	$	(10)	$	—

Weighted-average age of policyholders (years)	64.3		73.5		59.7		—
Net amount at risk	$	3,079	$	10,464	$	11	$	—

_______________

(1)

March 31, 2023 March 31, 2022
GMxB Core GMxB Core
(Dollars in millions)
Balance, beginning of the period (“BOP”) $ (9) $ —
Balance BOP before changes in the instrument specific credit risk (8) 1
Model changes and effect of changes in cash flow assumptions — —
Actual market movement effect (5) 4
Interest accrual — —
Attributed fees accrued (1) 1 —
Benefit payments — —
Actual policyholder behavior different from expected behavior 2 1
Changes in future economic assumptions 2 (7)
Issuances — (1)
Balance EOP before changes in the instrument-specific credit risk (8) (2)
Changes in the instrument-specific credit risk (2) (6) (5)
Balance, end of the period (“EOP”) $ (14) $ (7)
Weighted-average age of policyholders (years) 61.3 59.5
Net amount at risk $ 9 $ 2

~~(1)~~ Attributed fees accrued represents the portion of the fees needed to fund future GMxB claims.

(2)Issuances are related to the Reinsurance Treaty with Equitable Financial. See Note 1 of the Notes to these Financial Statements.

(3)Changes are recorded in OCI.

~~(3) Purchased MRB is~~

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


	Six Months Ended June 30,
	2023				2022
	GMxB Core		GMxB Legacy		GMxB Core		GMxB Legacy
	(Dollars in millions)
Balance, beginning of period	$	(9)	$	—	$	—	$	—
Balance BOP before changes in the instrument specific credit risk	(8)		—		1		—
Model changes and effect of changes in cash flow assumptions	—		—		—		—
Actual market movement effect	(113)		(264)		14		—
Interest accrual	9		68		—		—
Attributed fees accrued (1)	102		95		1		—
Benefit payments	(12)		(153)		—		—
Actual policyholder behavior different from expected behavior	8		(4)		2		—
Changes in future economic assumptions	(222)		(364)		(19)		—
Issuances (2)	1,292		6,865		(1)		—
Balance EOP before changes in the instrument-specific credit risk	1,056		6,243		(2)		—
Changes in the instrument-specific credit risk (3)	(9)		(6)		(8)		—
Balance, end of period	$	1,047	$	6,237	$	(10)	$	—

Weighted-average age of policyholders (years)	64.3		73.5		59.7		—
Net amount at risk	$	3,079	$	10,464	$	11	$	—

_______________

(1)Attributed fees accrued represents the ~~impact~~portion of ~~non-affiliated reinsurance.~~the fees needed to fund future GMxB claims.

(2)Issuances are related to the Reinsurance Treaty with Equitable Financial. See Note 1 of the Notes to these Financial Statements.

(3)Changes are recorded in OCI.

The following table reconciles market risk benefits by the amounts in an asset position and amounts in a liability position to the market risk amounts in the balance sheet as of ~~March 31,~~June 30, 2023 and December 31, ~~2022.~~2022:


		March 31, 2023										December 31, 2022											June 30, 2023										December 31, 2022
		Direct Asset		Direct Liability		Net Direct MRB		Purchased MRB		Total		Direct Asset		Direct Liability		Net Direct MRB		Purchased MRB		Total			MRB Asset		MRB Liability		Net MRB		Purchased MRB		Total		MRB Asset		MRB Liability		Net MRB		Purchased MRB		Total
		(in millions)																					(in millions)

GMxB Core	GMxB Core	(17)		3		(14)		—		(14)		(12)		3		(9)		—		(9)		GMxB Core	$	(25)	$	1,072	$	1,047	$	—	$	1,047	$	(12)	$	3	$	(9)	$	—	$	(9)
GMxB Legacy																						GMxB Legacy	—		6,237		6,237		—		6,237		—		—		—		—		—
Other (1)	Other (1)	—		11		11		(11)		—		—		12		12		(13)		(1)		Other (1)	(1)		54		53		(10)		43		—		12		12		(13)		(1)
Total	Total	$	(17)	$	14	$	(3)	$	(11)	$	(14)	$	(12)	$	15	$	3	$	(13)	$	(10)	Total	$	(26)	$	7,363	$	7,337	$	(10)	$	7,327	$	(12)	$	15	$	3	$	(13)	$	(10)

______________

(1) Other, for June 30, 2023, primarily reflects Individual EquiVest. Other, for December 31, 2022, primarily reflects Protective Life ~~not reflected within the MRB roll-forward table.~~Reinsured business.

3442

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

9) POLICYHOLDER ACCOUNT BALANCES

The following table summarizes the balances and changes in policyholders’ account balances ~~three~~for the six months ended ~~and as of March 31, 2023 and 2022:~~June 30, 2023:


		Indexed Universal Life		Variable Universal Life		GMxB Core		Investment Edge		SCS (2)		Reinsured (1)			Six Months Ended June 30, 2023
March 31, 2023		(Dollars in millions)
Balance, beginning of the period		$	1,962	$	655	$	27	$	7	242		$	819
Issuances		—		—		—		—		—		—
															UL		IUL		EI		EG		SCS (1)
															(Dollars in millions)
Balance, beginning of period														Balance, beginning of period	$	—	$	1,962	$	—	$	—	242
Issuances (2)														Issuances (2)	1,208		349		2,213		6,817		31,189
Premiums received	Premiums received	58		5		29		—		—		6		Premiums received	122		119		3		93		—
Policy charges	Policy charges	(44)		(9)		(2)		—		—		(9)		Policy charges	(128)		(93)		—		(1)		(2)
Surrenders and withdrawals	Surrenders and withdrawals	(7)		—		—		—		(1)		(23)		Surrenders and withdrawals	(4)		(25)		(74)		(230)		(606)
Benefit payments	Benefit payments	(3)		(2)		—		—		—		(2)		Benefit payments	(5)		(5)		(9)		(7)		(55)
Net transfers from (to) separate account	Net transfers from (to) separate account	—		11		(26)		77		1,031		—		Net transfers from (to) separate account	—		—		(12)		45		2,823
Interest credited (3)	Interest credited (3)	30		9		—		1		24		8		Interest credited (3)	9		73		16		69		2,212
Other		—		—		—		—		—		1
Balance, end of the period		$	1,996	$	669	$	28	$	85	$	1,296	$	800
Balance, end of period														Balance, end of period	$	1,202	$	2,380	$	2,137	$	6,786	$	35,803

Weighted-average crediting rate	Weighted-average crediting rate	2.23%		3.52%		1.00%		1.00%		1.00%		4.12%		Weighted-average crediting rate	3.32%		2.34%		2.92%		2.31%		N/A
Net amount at risk (4)	Net amount at risk (4)	$	18,004	$	30,589	$	9	$	—	$	—	$	4,011	Net amount at risk (4)	$	16,580	$	19,438	$	107	$	17	$	11
Cash surrender value	Cash surrender value	$	1,505	$	535	$	32	$	81	$	1,208	$	799	Cash surrender value	$	1,044	$	1,790	$	2,130	$	6,713	$	32,495

______________

(1)~~Reinsured primarily reflects Protective Life reinsured business.~~

~~(2)~~SCS sales are recorded in a Separate Account holding account until they are swept into the General Account. This sweep is recorded as Net Transfers from (to) ~~separate account.~~separate.

(2)Issuances are related to the Reinsurance Treaty with Equitable Financial. See Note 1 of the Notes to these Financial Statements.

(3)SCS includes amounts related to the change in embedded derivative.

(4)For life insurance products, the net amount at risk is death benefit less account value for the policyholder. For variable annuity products, the net amount at risk is the maximum GMxB NAR for the policyholder.

Indexed Universal Life Variable Universal Life GMxB Core Investment Edge SCS (2) Reinsured (1)
March 31, 2022 (Dollars in millions)
Balance, beginning of period $ 1,973 $ 614 $ 13 $ — $ — $ 867
Issuances — — — — — —
Premiums received 66 4 4 — — 8
Policy charges (44) (2) (1) — — (8)
Surrenders and withdrawals (6) — — — — (22)
Benefit payments (3) (1) — — — (1)
Net transfers from (to) separate account — 9 — — — 2
Interest credited (3) 2 5 — — — 9
Other — — — — — —
Balance, end of the period $ 1,988 $ 629 $ 16 $ — $ 855
Weighted-average crediting rate 2.19 % 3.53 % 1.00 % — % — % 4.31 %
Net amount at risk (4) $ 18,296 $ 27,994 $ 2 $ — $ — $ 4,279
Cash surrender value $ 1,452 $ 511 $ 18 $ — $ — $ 855
The following table summarizes the balances and changes in policyholders’ account balances for the six months ended June 30, 2022:

~~______________~~


	Six Months Ended June 30, 2022
	IUL		VUL		GMxB Core		Reinsured (2)
	(Dollars in millions)
Balance, beginning of period	$	1,973	$	614	$	13	$	866
Issuances	—		—		—		—
Premiums received	127		9		30		18
Policy charges	(89)		(14)		(1)		(12)
Surrenders and withdrawals	(12)		—		—		(39)
Benefit payments	(4)		(4)		—		(6)
Net transfers from (to) separate account	—		26		(27)		2
Interest credited (3)	(54)		7		—		18
Other	—		—		—		—
Balance, end of period	$	1,941	$	638	$	15	$	847

Weighted-average crediting rate	2.18%		3.52%		1.00%		4.27%
Net amount at risk (4)	$	18,260	$	28,861	$	11	$	4,272
Cash surrender value	$	1,477	$	518	$	16	$	846

___________

(1)~~Reinsured primarily reflects Protective Life reinsured business.~~

~~(2)~~SCS sales are recorded in a Separate Account holding account until they are swept into the General Account. This sweep is recorded as Net Transfers from (to) separate account.

~~(3)SCS includes amounts related to the change in embedded derivative.~~

3543

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

(2)Reinsured primarily reflects Protective Life reinsured business.

(3)SCS includes amounts related to the change in embedded derivative.

The following table reconciles the policyholders account balances to the policyholders’ account balance liability in the balance sheet as of ~~March 31,~~June 30, 2023 and December 31, ~~2022.~~2022:

March 31, 2023 December 31, 2022
(in millions)
Policyholders’ account balance reconciliation
IUL $ 1,996 $ 1,962
VUL 669 655
GMxB Core 28 27
Investment Edge 85 7
SCS 1,296 242
Reinsured 800 819
Other 36 39
Total $ 4,910 $ 3,751


	June 30, 2023
	(in millions)
Policyholders’ account balance reconciliation
UL	$	1,202
IUL	2,380



EI	2,137
EG	6,786
SCS	35,803
Other (1)	(27,294)
Total	$	21,014

______________

(1) Includes $(30) billion of assumed fair value of the modco reinsurance with Equitable Financial.


	December 31, 2022
	(in millions)
Policyholders’ account balance reconciliation
IUL	$	1,962
VUL	655
GMxB Core	27
IE	7
SCS	242
Reinsured	819
Other	39
Total	$	3,751

The following table presents the account values by range of guaranteed minimum crediting rates and the related range of the difference in basis points, between rates being credited policyholders and the respective guaranteed minimums as of ~~March 31,~~June 30, 2023 and December 31, ~~2022.~~

March 31, 2023
Product
(1) Range of Guaranteed Minimum Crediting Rate At Guaranteed Minimum 1 Basis Point - 50 Basis Points Above 51 Basis Points - 150 Basis Points Above Greater Than 150 Basis Points Above Total
(in millions)
Indexed Universal Life 0.00% - 1.50% $ — $ — $ — $ — $ —
1.51% - 2.50% 1,166 611 172 — 1,949
Greater than 2.50% — — — — —
Total $ 1,166 $ 611 $ 172 $ — $ 1,949
Variable Universal Life 0.00% - 1.50% $ 15 $ 36 $ 5 $ — $ 56
1.51% - 2.50% 59 27 — — 86
Greater than 2.50% 462 — 2 — 464
Total $ 536 $ 63 $ 7 $ — $ 606
Investment Edge 0.00% - 1.50% $ 84 $ — $ — $ — $ 84
1.51% - 2.50% —
Greater than 2.50% —
Total $ 84 $ — $ — $ — $ 84
GMxB Core 0.00% - 1.50% $ 35 $ — $ — $ — $ 35
1.51% - 2.50% — — — — —
Greater than 2.50% — — — — —
Total $ 35 $ — $ — $ — $ 35
2022:


June 30, 2023
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
		(in millions)
Universal Life	0.00% - 1.50%	$	—	$	—	$	—	$	—	$	—
	1.51% - 2.50%	76		13		476		130		695
	Greater than 2.50%	—		506		—		—		506
	Total	$	76	$	519	$	476	$	130	$	1,201

3644

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

December 31, 2022
Product
Range of Guaranteed Minimum Crediting Rate At Guaranteed Minimum 1 Basis Point-50 Basis Points Above 51 Basis Points-150 Basis Points Above Greater Than 150 Basis Points Above Total
(in millions)
Indexed Universal Life 0.00% - 1.50% $ — $ — $ — $ — $ —
1.51% - 2.50% 1,202 666 73 — 1,941
Greater than 2.50% — — — — —
Total $ 1,202 $ 666 $ 73 $ — $ 1,941
Variable Universal Life 0.00% - 1.50% $ 18 $ 30 $ 2 $ — $ 50
1.51% - 2.50% 73 12 — — 85
Greater than 2.50% 460 — 2 — 462
Total $ 551 $ 42 $ 4 $ — $ 597
Investment Edge 0.00% - 1.50% $ 7 $ — $ — $ — $ 7
1.51% - 2.50% — — — — —
Greater than 2.50% — — — — —
Total $ 7 $ — $ — $ — $ 7
GMxB Core 0.00% - 1.50% $ 32 $ — $ — $ — $ 32
1.51% - 2.50% — — — — —
Greater than 0.025 — — — — —
Total $ 32 $ — $ — $ — $ 32


June 30, 2023
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
		(in millions)
Universal Life	0.00% - 1.50%	$	—	$	—	$	—	$	—	$	—
Indexed Universal Life	0.00% - 1.50%	$	—	$	—	$	—	$	—	$	—
	1.51% - 2.50%	1,125		596		559		—		2,280
	Greater than 2.50%	—		—		—		—		—
	Total	$	1,125	$	596	$	559	$	—	$	2,280

EQUI-VEST Individual	0.00% - 1.50%	$	51	$	218	$	—	$	—	$	269
	1.51% - 2.50%	44		—		—		—		44
	Greater than 2.50%	1,823		—		—		—		1,823
	Total	$	1,918	$	218	$	—	$	—	$	2,136

SCS	Products with either a fixed rate or no guaranteed minimum	N/A		N/A		N/A		N/A		N/A

EQUI-VEST Group	0.00% - 1.50%	$	497	$	1,982	$	23	$	315	$	2,817
	1.51% - 2.50%	258		—		—		—		258
	Greater than 2.50%	2,844		—		1		—		2,845
	Total	$	3,599	$	1,982	$	24	$	315	$	5,920

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


December 31, 2022
Product	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point-50 Basis Points Above		51 Basis Points-150 Basis Points Above		Greater Than 150 Basis Points Above		Total
		(in millions)
Indexed Universal Life	0.00% - 1.50%	$	—	$	—	$	—	$	—	$	—
	1.51% - 2.50%	1,202		666		73		—		1,941
	Greater than 2.50%	—		—		—		—		—
	Total	$	1,202	$	666	$	73	$	—	$	1,941

Variable Universal Life	0.00% - 1.50%	$	18	$	30	$	2	$	—	$	50
	1.51% - 2.50%	73		12		—		—		85
	Greater than 2.50%	460		—		2		—		462
	Total	$	551	$	42	$	4	$	—	$	597

Investment Edge	0.00% - 1.50%	$	7	$	—	$	—	$	—	$	7
	1.51% - 2.50%	—		—		—		—		—
	Greater than 2.50%	—		—		—		—		—
	Total	$	7	$	—	$	—	$	—	$	7

GMxB Core	0.00% - 1.50%	$	32	$	—	$	—	$	—	$	32
	1.51% - 1.51%	—		—		—		—		—
	Greater than 2.50%	—		—		—		—		—
	Total	$	32	$	—	$	—	$	—	$	32

Separate Account - Summary

The following table presents the balances of and changes in separate account liabilities ~~three~~for the six months ended ~~and as of March 31,~~June 30, 2023 and ~~2022.~~2022:


	Six Months Ended June 30, 2023
	VUL		GMxB Core		IE		Reinsured (2)

Balance, beginning of period	1,653		$	756	$	26	$	913
Premiums and deposits	190		439		270		11
Policy charges	(64)		(4)		—		(17)
Surrenders and withdrawals	(23)		(11)		(2)		(37)
Benefit payments	(5)		(3)		—		(11)
Investment performance (1)	192		79		4		141
Net transfers from (to) general account	(25)		65		(163)		(1)
Other charges	—		—		—		—
Balance, end of period	$	1,918	$	1,321	$	135	$	999

Cash surrender value	$	1,590	$	1,221	$	129	N/A

_______________

VUL GMxB Core Investment Edge Reinsured (1)
March 31, 2023 (in millions)
Balance, beginning of the period $ 1,653 $ 756 $ 26 $ 913
Premiums and deposits 96 139 138 5
Policy charges (32) (2) — (8)
Surrenders and withdrawals (10) (5) — (14)
Benefit payments (2) (2) — (4)
Investment performance (2) 98 38 1 74
Net transfers from (to) general account (11) 26 (77) —
Balance, end of the period $ 1,792 $ 950 $ 88 $ 966
Cash surrender value $ 1,468 $ 874 $ 84 N/A
(1)Investment performance is reflected net of mortality and expense fees.

~~_______________~~

~~(1)~~ (2)Reinsured primarily reflects Protective Life reinsured ceded business.

~~(2) Investment performance is reflected net of M&E fees.~~

3746

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

VUL GMxB Core Investment Edge Reinsured (1)
March 31, 2022 (in millions)
Balance, beginning of the period $ 1,832 $ 315 $ — $ 1,244
Premiums and deposits 92 109 — 6
Policy charges (34) — — (9)
Surrenders and withdrawals (8) (2) — (14)
Benefit payments (1) — — (5)
Net transfers from (to) general account (109) — — (2)
Investment Performance (2) (12) (21) — (92)
Balance, end of the period $ 1,760 $ 401 $ — $ 1,128
Cash surrender value $ 1,452 $ 370 $ — N/A

~~______________~~


	Six Months Ended June 30, 2022
	VUL		GMxB Core		Reinsured (1)
	(in millions)
Balance, beginning of period	$	1,832	$	315	$	1,244
Premiums and deposits	177		166		10
Policy charges	(60)		(1)		(14)
Surrenders and withdrawals	(16)		(3)		(24)
Benefit payments	(3)		—		(5)
Investment performance (2)	(361)		(74)		(141)
Net transfers from (to) general account	(26)		27		(2)
Other charges	—		—		—
Balance, end of period	$	1,543	$	430	$	1,068

Cash surrender value	$	1,241	$	392	N/A

_______________

(1)Reinsured primarily reflects Protective Life reinsured ceded business.

(2)Investment performance is reflected net of ~~M&E~~mortality and expense fees.

The following table reconciles the separate account liabilities to the separate account liability balance in the balance sheet as of ~~March 31,~~June 30, 2023 and December 31, ~~2022.~~2022:


	June 30, 2023
	(in millions)
Separate Account Reconciliation
VUL	$	1,918
GMxB Core	1,321

IE	135


Reinsured	999
Other	135
Total	$	4,508

March 31, 2023 December 31, 2022
(in millions)
Separate Account Reconciliation
VUL $ 1,792 $ 1,653
GMxB Core 950 756
Investment Edge 88 26
Reinsured 966 913
Other 71 26
Total $ 3,867 $ 3,374


	December 31, 2022
	(in millions)
Separate Account Reconciliation
VUL	$	1,653
GMxB Core	756
IE	26
Reinsured	913
Other	26
Total	$	3,374

The following table presents the aggregate fair value of separate account assets by major asset category as of ~~March 31,~~June 30, 2023 and December 31, ~~2022.~~

March 31, 2023
Life Insurance & Employee Benefits Products Individual Variable Annuity Products Employer - Sponsored Products Other Total
(in millions)
Asset Type
Mutual Funds $ 2,268 $ 1,586 $ — $ 13 $ 3,867
Total $ 2,268 $ 1,586 $ — $ 13 $ 3,867

2022:

3847

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


		December 31, 2022											June 30, 2023
		Life Insurance & Employee Benefits Products		Individual Variable Annuity Products		Employer - Sponsored Products		Other		Total			Life Insurance & Employee Benefits Products		Individual Variable Annuity Products		Employer - Sponsored Products		Other		Legacy Segment		Total
		(in millions)											(in millions)
Asset Type	Asset Type											Asset Type

Mutual Funds	Mutual Funds	$	2,096	$	1,265	$	—	$	13	$	3,374	Mutual Funds	$	2,414	$	2,081	$	—	$	13	$	—	$	4,508

Total	Total	$	2,096	$	1,265	$	—	$	13	$	3,374	Total	$	2,414	$	2,081	$	—	$	13	$	—	$	4,508


	December 31, 2022
	Life Insurance & Employee Benefits Products			Individual Variable Annuity Products			Employer - Sponsored Products			Other			Legacy Segment		Total
	(in millions)
Asset Type


Mutual Funds	$	2,096	—	$	1,265	—	$	—	—	$	13	—	$	—	$	3,374

Total	$	2,096		$	1,265		$	—		$	13		$	—	$	3,374

10) INCOME TAXES

Income tax expense for the three and six months ended ~~March 31,~~June 30, 2023 and 2022 was computed using an estimated annual effective tax rate (“ETR”), with discrete items recognized in the period in which they occur. The estimated ETR is revised, as necessary, at the end of successive interim reporting periods.

During the fourth quarter of 2022, the Company established a valuation allowance of $85 million against its deferred tax ~~assets~~asset related to unrealized capital losses in the ~~available for sale~~AFS securities portfolio. For the ~~three-months~~three month period ended March 31, 2023, the Company recorded a decrease to the valuation allowance of $16 million due to a decrease in the portfolio’s unrealized capital loss. This adjustment was allocated to other comprehensive income.

As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. ~~The~~During the three-months ended March 31, 2023, the Company ~~has reassessed its ability to increase~~increased its available future liquidity by increasing borrowing capacity and amending certain counterparty agreements. As a result of these actions, the Company ~~now has the~~was able to assert its ability and intent to hold the underlying securities in its ~~available for sale~~AFS portfolio to recovery. Based on all available evidence, ~~as of March 31, 2023,~~ the Company concluded the deferred tax assets related to unrealized tax capital losses are more-likely-than-not to be realized and that a valuation allowance iswas not necessary. The remaining release of the valuation allowance of $69 million was recorded in net ~~income.~~income for the three months ended March 31, 2023.

The Company uses the aggregate portfolio approach related to the stranded or disproportionate income tax effects in accumulated other comprehensive income related to ~~available for sale~~AFS securities. Under this approach, the disproportionate tax effect remains intact as long as the investment portfolio remains.

11) RELATED PARTY TRANSACTIONS

~~The Company did not enter~~On May 17, 2023, Equitable America entered into ~~any new significant transactions~~a reinsurance agreement with ~~related parties during~~Equitable Financial, effective April 1, 2023. See Note 1 and Note 16 of the ~~first quarter 2023.~~Notes to these Financial Statements for further details.

12) EQUITY

AOCI represents cumulative gains (losses) on items that are not reflected in net income (loss). The balances as of ~~March 31,~~June 30, 2023 and December 31, 2022 is as follows:

March 31, 2023 December 31, 2022
(in millions)
Unrealized gains (losses) on investments $ (309) $ (383)
Market risk benefits - instrument-specific credit risk component 7 1
Accumulated other comprehensive income (loss) $ (302) $ (382)

~~The components of OCI, net of taxes for the three months ended March 31, 2023 and 2022, follow:~~

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Three Months Ended March 31,
2023 2022
(in millions)
Change in net unrealized gains (losses) on investments:
Net unrealized gains (losses) arising during the period $ 72 $ (176)
(Gains) losses reclassified into net income (loss) during the period (1) 4 1
Net unrealized gains (losses) on investments 76 (175)
Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other (1) 4
Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $16 and $(45). 75 (171)
Change in LFPB discount rate and MRB credit risk
Changes in instrument-specific credit risk - market risk benefits (net of deferred income tax expense (benefit) of $1 and $1. 5 5
Changes in current discount rate - liability for future policy benefits (net of deferred income tax expense (benefit) of $0 and $0. — —
Other comprehensive income (loss) $ 80 $ (166)



	June 30, 2023		December 31, 2022
	(in millions)
Unrealized gains (losses) on investments	$	(362)	$	(383)
Market risk benefits - instrument-specific credit risk component	16		1
Liability or future policy benefits - current discount rate component	$	1	$	—
Accumulated other comprehensive income (loss)	$	(345)	$	(382)

The components of OCI, net of taxes for the three and six months ended June 30, 2023 and 2022, follow:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	(in millions)
Change in net unrealized gains (losses) on investments:
Net unrealized gains (losses) arising during the period	$	(51)	$	(159)	$	21	$	(335)
(Gains) losses reclassified into net income (loss) during the period (1)	—		2		4		3
Net unrealized gains (losses) on investments	(51)		(157)		25		(332)
Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other	—		4		(1)		8
Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $(28), $(41), $(12) and $(86)).	(51)		(153)		24		(324)
Change in LFPB discount rate and MRB credit risk
Market risk benefits - change in instrument-specific credit risk (net of deferred income tax expense (benefit) of $2, $1, $3 and $2).	7		3		12		8
Liability for future policy benefits - change in current discount rate (net of deferred income tax expense (benefit) of $—, $—, $—, and $—)	1		—		1		—



Other comprehensive income (loss)	$	(43)	$	(150)	$	37	$	(316)

____________

(1)See “Reclassification adjustment” in Note 3 of the Notes to these Financial Statements. Reclassification amounts presented net of income tax expense (benefit) of $1$(2) million, $(1) million, $(1) million and $0$(1) million for the three and six months ended ~~March 31,~~June 30, 2023 and 2022, respectively.

Investment gains and losses reclassified from AOCI to net income (loss) primarily consist of realized gains (losses) on sales and credit losses of AFS securities and are included in total investment gains (losses), net on the statements of income (loss). Amounts presented in the table above are net of tax.

13) COMMITMENTS AND CONTINGENT LIABILITIES

Litigation

Litigation, regulatory and other loss contingencies arise in the ordinary course of the Company’s activities. The Company is a defendant in litigation matters arising from the conduct of its business. In some of these matters, claimants seek to recover very large or indeterminate amounts, including compensatory, punitive, treble and exemplary damages. Modern pleading practice permits considerable variation in the assertion of monetary damages and other relief. Claimants are not always required to specify the monetary damages they seek, or they may be required only to state an amount sufficient to meet a court’s jurisdictional requirements. Moreover, some jurisdictions allow claimants to allege monetary damages that far exceed any reasonably possible verdict. The variability in pleading requirements and past experience demonstrates that the monetary and other relief that may be requested in a lawsuit or claim often bears little relevance to the merits or potential value of a claim.

The outcome of a litigation or regulatory matter is difficult to predict, and the amount or range of potential losses associated with these or other loss contingencies requires significant management judgment. It is not possible to predict the ultimate outcome or to provide reasonably possible losses or ranges of losses for all pending regulatory matters, litigation and other loss contingencies. While it is possible that an adverse outcome in certain cases could have

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

a material adverse effect upon the Company’s financial position, based on information currently known, management believes that neither the outcome of pending litigation and regulatory matters, nor potential liabilities associated with other loss contingencies, are likely to have such an effect. However, given the large and indeterminate amounts sought in certain litigation and the inherent unpredictability of all such matters, it is possible that an adverse outcome in certain of the Company’s litigation or regulatory matters, or liabilities arising from other loss contingencies, could, from time to time, have a material adverse effect upon the Company’s results of operations or cash flows in a particular quarterly or annual period.

For some matters, the Company is able to estimate a range of loss. For such matters in which a loss is probable, an accrual has been made. For matters where the Company believes a loss is reasonably possible, but not probable, no accrual is required. For matters for which an accrual has been made, but there remains a reasonably possible range of loss in excess of the amounts accrued or for matters where no accrual is required, the Company develops an estimate of the unaccrued amounts of the reasonably possible range of losses. As of ~~March 31,~~June 30, 2023, the Company estimates the aggregate range of reasonably possible losses, in excess of any amounts accrued for these matters as of such date, to be up to approximately $5 million.

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

For other matters, the Company is currently not able to estimate the reasonably possible loss or range of loss. The Company is often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the range of possible loss, such as quantification of a damage demand from plaintiffs, discovery from plaintiffs and other parties, investigation of factual allegations, rulings by a court on motions or appeals, analysis by experts and the progress of settlement discussions. On a quarterly and annual basis, the Company reviews relevant information with respect to litigation and regulatory contingencies and updates the Company’s accruals, disclosures and reasonably possible losses or ranges of loss based on such reviews.

Funding Agreement-Backed Commercial Paper Program

In May 2023, the Company established a funding agreement-backed commercial paper program (the “FABCP Program”), pursuant to which a special purpose limited liability company (the “SPLLC”) may issue commercial paper and deposit the proceeds with the Company pursuant to a funding agreement issued by the Company to the SPLLC. The current maximum aggregate principal amount permitted to be outstanding at any one time under the FABCP Program is $1.0 billion. The Company had $0 outstanding as of June 30, 2023.

Guarantees and Other Commitments

The Company has no outstanding commitments under existing mortgage loans or mortgage loan commitment agreements at ~~March 31,~~June 30, 2023.

14) INSURANCE STATUTORY FINANCIAL INFORMATION

Prescribed and Permitted Accounting Practices

As of June 30, 2023, the following prescribed practice resulted in surplus that is different from the statutory surplus that would have been reported had NAIC statutory accounting practices been applied.

During 2022, Equitable Life Financial Insurance Company of America received approval from the Arizona Department of Insurance and Financial Institutions pursuant to A.R.S. 20-515 for Separate Account No. 68A (“SA 68A”) for our Structured Capital Strategies product, Separate Account No. 69A (“SA 69A”) for our EQUI-VEST product Structured Investment Option and Separate Account No. 71A (“SA 71A”) for our Investment Edge Structured Investment Option, to permit us to use book value as the accounting basis of these three non-insulated Separate Accounts instead of fair value in accordance with the NAIC Accounting and Practices and Procedures Manual to align with how we manage and measure our overall general account asset portfolio. The impact of the application is a decrease of approximately $36 million in statutory surplus as of June 30, 2023.

15) UNPAID CLAIM AND CLAIM EXPENSES

The following summarizes the change in liability for unpaid claims and claim ~~expenses as of March 31, 2023 and 2022 is as follows:~~expenses:

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Liability for Unpaid Claims and Claim Expenses


		2023		2022			Six Months Ended June 30,
		(in millions)					2023		2022
Gross Balance at January 1,		$	110	$	78
							(in millions)
Gross Balance, beginning of period						Gross Balance, beginning of period	$	110	$	78
Less Reinsurance	Less Reinsurance	36		23		Less Reinsurance	36		23
Net Balance at January 1,		74		55
Net Balance, beginning of period						Net Balance, beginning of period	74		55

Incurred Claims (net) Related to:	Incurred Claims (net) Related to:					Incurred Claims (net) Related to:
Current Period	Current Period	67		40		Current Period	121		88
Prior Period	Prior Period	(16)		(1)		Prior Period	(14)		9
Total Incurred	Total Incurred	51		39		Total Incurred	107		97

Paid Claims (net) Related to:	Paid Claims (net) Related to:					Paid Claims (net) Related to:
Current Period	Current Period	23		15		Current Period	65		49
Prior Period	Prior Period	26		20		Prior Period	33		27
Total Paid	Total Paid	49		35		Total Paid	98		76

Net Balance at March 31,		76		59
Net Balance, end of period						Net Balance, end of period	83		76
Add Reinsurance	Add Reinsurance	38		25		Add Reinsurance	40		29
Gross Balance at March 31,		$	114	$	84
Gross Balance, end of period						Gross Balance, end of period	$	123	$	105

~~15)~~16) REINSURANCE

The Company assumes and cedes reinsurance with other insurance companies. The Company evaluates the financial condition of its reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. Ceded reinsurance does not relieve the originating insurer of liability.

The following table summarizes the effect of reinsurance:

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
					(in millions)
Direct charges and fee income	$	92	$	78	$	178	$	151
Reinsurance assumed - Equitable Financial	345		—		345		—
Reinsurance ceded	(26)		(22)		(51)		(39)
Policy charges and fee income	$	411	$	56	$	472	$	112

Direct premiums	$	86	$	74	$	171	$	133
Reinsurance assumed - Equitable Financial	40		—		40		—
Reinsurance ceded	(14)		(14)		(30)		(24)
Premiums	$	112	$	60	$	181	$	109

Direct policyholders’ benefits	$	110	$	106	$	209	$	191
Reinsurance assumed - Equitable Financial	264		—		264		—
Reinsurance ceded	(39)		(24)		(59)		(35)
Policyholders’ benefits	$	335	$	82	$	414	$	156

Direct interest credited to policyholders’ account balances	$	42	$	32	$	74	$	77
Reinsurance assumed - Equitable Financial	151		—		151		—
Reinsurance ceded	(8)		(9)		(17)		(35)
Interest credited to policyholders’ account balances	$	185	$	23	$	208	$	42

Ceded Reinsurance

In 2013, the Company entered into the Reinsurance Agreement with Protective to reinsure an in-force book of life insurance and annuity policies written prior to 2004. In addition to the Reinsurance Agreement, the Company entered into a long-term administrative services agreement with Protective whereby Protective will provide all administrative and other services with respect to the reinsured business.

For business not reinsured with Protective, the Company generally reinsures its variable life and interest-sensitive life insurance policies on an excess of retention basis. The Company generally retains up to a maximum of $4 million of mortality risk on single-life policies and up to a maximum of $6 million of mortality risk on second-to die policies. For amounts applied for in excess of those limits, reinsurance is ceded to Equitable Financial up to a combined maximum of $20 million of risk on single-life policies and up to a maximum of $25 million on second-to die policies. For amounts issued in excess of these limits, reinsurance is typically obtained from unaffiliated third parties. These reinsurance arrangements obligate the reinsurers to pay a portion of any death claim in excess of the amount the Company retains in exchange for an agreed-upon premium.

Equitable America has a quota share arrangement with AXA Global Re (formerly AXA Cessions), assuming a percentage of excess Life/Disability/A&H business. The contract is now closed to new business.

Beginning in 2015, group short and long-term disability is being reinsured with Group Reinsurance Plus (GRP) via a quota share arrangement.

Assumed Reinsurance

On May 17, 2023, Equitable America entered into a Reinsurance Treaty with Equitable Financial, effective April 1, 2023. Pursuant to the Reinsurance Treaty, virtually all of Equitable Financial’s net retained General Account liabilities, including all of its net retained liabilities relating to the living benefit and death riders related to (i) its variable annuity contracts issued outside the State of New York prior to October 1, 2022 (and with respect to its EQUI-VEST variable annuity contracts, issued outside the State of New York prior to February 1, 2023) and (ii) certain universal life insurance policies issued outside the State of New York prior to October 1, 2022, were reinsured to Equitable America on a coinsurance funds withheld basis. See Note 1 to these Financial Statements for further details on the transaction.

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

There is a diverse pool of assets supporting the funds withheld and NI modco arrangement with Equitable Financial. The following table summarizes the composition of the pool of assets at June 30, 2023:



	June 30, 2023
	Carrying Value		Fair Value
	(in millions)
Fixed maturities	$	25,889	$	25,889
Mortgage loans on real estate	8,528		7,391
Policy loans	229		230
Other equity investments	245		245
Other invested assets (1)	7,249		7,249
Total assets supporting funds withheld	$	42,140	$	41,004

(1) Other invested assets includes derivatives and cash and cash equivalents.

17) REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

During the quarter ended September 30, 2022, the Company identified errors primarily related to the calculation of the deferred cost of reinsurance amortization. Specifically, the deferred cost of reinsurance as reflected on the balance sheet was overstated and operating expenses (deferred cost amortization) was understated commencing in the quarter ended December 31, 2019 with a cumulative impact of $14 million pre-tax. In accordance with SAB No. 108, management evaluated the impact of this error and concluded that previously issued financial statements were not materially misstated; however, the cumulative impact would be material to the quarter ended September 30, 2022 and annual period ending December 31, 2022 and accordingly, determined to revise previously reported financial statements for years ended December 31, 2021, 2020 and 2019 and for the three-month periods ended March 31, 2022 and 2021 and June 30, 2022 and 2021 and for the six-months periods ended June 30, 2022 and June 2021. As a result of the determination to revise previously issued financial statements for the amortization matter discussed above, management also has corrected other previously identified but uncorrected errors and errors recorded in incorrect periods including, (a) balance sheet gross up errors resulting from incorrectly calculating reserves relating to business which has been 100% ceded to reinsurers resulting in corrections to Future policy benefits and other policyholders’ liabilities and Amounts due from reinsurers; (b) the classification of a preferred stock investment of $25 million from

~~EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA~~

~~Notes to Financial Statements (Unaudited), Continued~~

~~available for sale~~ AFS debt securities to equity securities and present previously recorded unrealized losses as net investment income (loss) rather than as a component of other comprehensive income in the amount of $2 million; and, (c) other immaterial errors.

The following tables present line items for prior period impacted financial statements that have been affected by the errors discussed above as well as the impact of the adoption of ASU 2018-12:

Three Months Ended March 31, 2022
As Previously
Reported ASU 2018-12 Impact As Adjusted Impact of Revisions As Revised
(in millions)
Statements of Income (Loss):
Other operating costs and expenses $ 21 $ 1 $ 22 $ 1 $ 23
Total benefits and deductions 161 (15) 146 1 147
Income (loss) from continuing operations, before income taxes (22) (3) (25) (1) (26)
Net income (loss) from continuing operations (19) — (19) (1) (20)
Net income (loss) $ (19) $ — $ (19) $ (1) $ (20)

Three Months Ended March 31, 2022
As Previously
Reported ASU 2018-12 Impact As Adjusted Impact of Revisions As Revised
(in millions)
Statements of Comprehensive Income (Loss):
Net income (loss) $ (19) $ — $ (19) $ (1) $ (20)
Comprehensive income (loss) $ (169) $ (16) $ (185) $ (1) $ (186)

Three Months Ended March 31, 2022
Statements of Equity: As Previously
Reported ASU 2018-12 Impact As Adjusted Impact of Revision As Revised
(in millions)
Additional paid-in capital, beginning of year $ 679 $ — $ 679 $ 1 $ 680
Additional paid-in capital, end of period 680 — — — 680 — 1 — 681
Accumulated Deficit, beginning of year (60) (64) (124) (10) (134)
Net income (loss) (19) — (19) (1) (20)
Accumulated Deficit, end of period (79) — (64) — (143) (11) (154)
Total equity, end of period $ 540 $ (68) $ 472 $ (10) $ 462


	Three Months Ended June 30, 2022						Six Months Ended June 30, 2022
	As Previously Reported		ASU 2018-12 Impact		As Adjusted		Impact of Revisions		As Revised		As Previously Reported		ASU 2018-12 Impact		As Adjusted		Impact of Revisions		As Revised
	(in millions)
Statements of Income (Loss)












Benefits and other deductions








Other operating costs and expenses	$	22	$	(2)	$	20	$	1	$	21	$	43	$	(1)	$	42	$	2	$	44
Total benefits and deductions	177		(6)		171		1		172		338		(21)		317		2		319
Income (loss) from continuing operations, before income taxes	(12)		(20)		(32)		(1)		(33)		(34)		(23)		(57)		(2)		(59)
Income tax (expense) benefit from continuing operations	(1)		10		9		(1)		8		2		13		15		(1)		14
Net income (loss) from continuing operations	(13)		(10)		(23)		(2)		(25)		(32)		(10)		(42)		(3)		(45)

Net income (loss)	$	(13)	$	(10)	$	(23)	$	(2)	$	(25)	$	(32)	$	(10)	$	(42)	$	(3)	$	(45)

4253

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued

Three Months March 31, 2022
As Reported ASU 2018-12 Impact As Adjusted Impact of Revision As Revised
(in millions)
Statement of Cash Flows:
Cash flow from operating activities:
Net income (loss) $ (19) $ — $ (19) $ (1) $ (20)
Future policy benefits (4) — (4) 13 9
Reinsurance recoverable 14 — 14 (13) 1
Other, net 73 — 73 1 74


	Three Months Ended June 30, 2022						Six Months Ended June 30, 2022
	As Previously Reported		ASU 2018-12 Impact		As Adjusted		Impact of Revisions		As Revised		As Previously Reported		ASU 2018-12 Impact		As Adjusted		Impact of Revisions		As Revised
	(in millions)
Statements of Comprehensive Income (Loss)
Net income (loss)	$	(13)	$	(10)	$	(23)	$	(2)	$	(25)	$	(32)	$	(10)	$	(42)	$	(3)	$	(45)







Comprehensive income (loss)	$	(150)	$	(23)	$	(173)	$	(2)	$	(175)	$	(319)	$	(40)	$	(359)	$	(3)	$	(361)


	Three Months Ended June 30, 2022
Statements of Equity:		As Previously Reported		ASU 2018-12 Impact		As Adjusted		Impact of Revision		As Revised
		(in millions)


Additional paid-in capital, beginning of year		$	680	$	—	$	680	$	1	$	681









Additional paid-in capital, end of period		681		—		681		1		682

Accumulated Deficit, beginning of year		(79)		(64)		(142)		(12)		(154)



Net income (loss)		(13)		(10)		(23)		(2)		(25)


Accumulated Deficit, end of period		(92)		(74)		(166)		(13)		(179)












































Total equity, end of period		$	391	$	(92)	$	299	$	(11)	$	288

~~16) SUBSEQUENT EVENTS~~

~~Funding Agreement-Backed Commercial Paper Program~~

In May 2023, Equitable America established a funding agreement-backed commercial paper program (the “FABCP Program”), pursuant to which a special purpose limited liability company (the “SPLLC”) may issue commercial paper and deposit the proceeds with Equitable America pursuant to a funding agreement issued by Equitable America to the SPLLC. The current maximum aggregate principal amount permitted to be outstanding at any one time under the FABCP Program is $1.0 billion.


	Six Months Ended June 30, 2022
Statements of Equity:		As Previously Reported		ASU 2018-12 Impact		As Adjusted		Impact of Revision		As Revised
		(in millions)


Additional paid-in capital, beginning of year		$	679	$	—	$	679	$	1	$	680









Additional paid-in capital, end of year		681		—		681		1		682

Accumulated Deficit, beginning of year		(60)		(64)		(124)		(10)		(134)



Net income (loss)		(32)		(10)		(42)		(3)		(45)


Accumulated Deficit, end of year		(92)		(74)		(166)		(13)		(179)

Accumulated other comprehensive income (loss), beginning of year		86		12		98		—		98

Other comprehensive income (loss)		(287)		(30)		(317)		1		(316)








































Total equity, end of year		$	391	$	(92)	$	299	$	(11)	$	288

4354

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY OF AMERICA

Notes to Financial Statements (Unaudited), Continued


	Six Months June 30, 2022
		As Reported		ASU 2018-12 Impact		As Adjusted		Impact of Revision		As Revised
		(in millions)
Statement of Cash Flows:
Cash flow from operating activities:
Net income (loss)		$	(32)	$	(10)	$	(42)	$	(3)	$	(45)
























Future policy benefits		4		—		4		13		17
Reinsurance recoverable		1		—		1		(13)		(12)
Current and deferred income taxes		(2)		(13)		(15)		1		(14)



Other, net		$	104	$	—	$	104	$	2	$	106

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management’s discussion and analysis of financial condition and results of operations is presented pursuant to General Instruction (H)(2)(a) of Form 10-Q. The management’s narrative that follows should be read in conjunction with the financial statements and the related Notes to Financial Statements included elsewhere herein, with the information provided under “Note Regarding Forward-looking Statements and Information” included elsewhere herein and Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) in Part II, Item 7 contained in the Recast 2022 Annual Report and “Risk Factors” in Part I, Item 1A included in Equitable America’s Annual Report on Form 10-K for the year ended December 31, 2022 (“2022 Form 10-K”). The management’s narrative that follows represents a discussion and analysis of Equitable America’s financial condition and results of operations and not the financial condition and results of operations of Equitable Holdings, Inc. (“Holdings”).

Executive Summary

Overview

We are an indirect, wholly-owned subsidiary of Holdings. Our primary business is to provide life insurance, annuity, and employee benefit products to individuals and small and medium-sized businesses. We are licensed to sell our products in 49 states (not including New York), the District of Columbia and Puerto Rico.

Internal Reinsurance Treaty

On May 17, 2023, the Company entered into a reinsurance agreement (the “Reinsurance Treaty”) with Equitable Financial, effective April 1, 2023. Pursuant to the Reinsurance Treaty, virtually all of Equitable Financial’s net retained general account liabilities, including all of its net retained liabilities relating to the living benefit and death riders related to (i) its variable annuity contracts issued outside the State of New York prior to October 1, 2022 (and with respect to its EQUI-VEST variable annuity contracts issued outside the State of New York prior to February 1, 2023) and (ii) certain universal life insurance policies issued outside the State of New York prior to October 1, 2022 were reinsured to the Company on a coinsurance funds withheld basis. In addition, all of the Separate Account liabilities relating to such variable annuity contracts were reinsured to the Company on a modified coinsurance basis. The Company’s obligations under the Reinsurance Treaty are secured through Equitable Financial’s retention of certain assets supporting the reinsured liabilities. In exchange for the Company’s agreement to assume these liabilities, The New York Department of Financial Services (the “NYDFS”) and the Arizona Department of Insurance and Financial Institutions each approved the Reinsurance Treaty.

The Reinsurance Treaty further diversifies our sources of regulated cash flows and supports more stable dividends to Holdings from Equitable Financial and the Company.

As a condition to approving the Reinsurance Treaty, the NYDFS has required that Equitable Financial seeks to novate the reinsured contracts on a reasonable best effort basis either to the Company or another affiliate over the next three years. Novations of the reinsured contracts are subject to additional regulatory approvals, as well as certain policyholder approvals.

Long - Duration Targeted Improvements (“LDTI”) Adoption

Effective January 1, 2023, the Company adopted ASU 2018-12 and elected a transition date of January 1, 2021, thereby permitting the Company to implement the standard only for the last two fiscal years rather than the customary last three fiscal years.

The Company adopted ASU 2018-12 for liability for future policy benefits, additional insurance liabilities, DAC and balances amortized on a basis consistent with DAC on a modified retrospective basis. ASU 2018-12 was adopted for MRBs on a full retrospective basis. See Note 2 of the Notes to the Financial Statements for further information on the adoption of LDTI.

Macroeconomic and Industry Trends

Our business and results of operations are significantly affected by economic conditions and consumer confidence, conditions in the global capital markets and the interest rate environment.

Financial and Economic Environment

A wide variety of factors continue to impact financial and economic conditions. These factors include, among others, concerns over increased volatility in the capital markets, equity market declines, rising interest rates, inflationary pressures fueling concerns of a potential recession, plateauing or decreasing economic growth, high fuel and energy costs, changes in

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fiscal or monetary policy and geopolitical tensions. ~~Market volatility, particularly during March 2023, was driven by instability in the banking sector following continued interest rate increases by~~Despite ongoing concerns about inflation and the U.S. Federal ~~Reserve~~Reserve’s tightening monetary policies, the second quarter experienced positive returns for the S&P 500, the Dow Jones Industrial Average, and Nasdaq, driven primarily by a rally in ~~2022 and 2023, as a run on some mid-size U.S. banks resulted in regulatory intervention, including~~big technology stocks. However, the ~~guarantee of all deposits by the FDIC. The~~ ongoing military conflict between the Ukraine and Russia and the sanctions and other measures imposed in response to this conflict also continue to contribute to geopolitical tensions and market volatility.

Stressed conditions, volatility and disruptions in the capital markets, particular markets, or financial asset classes can have an adverse effect on us, in part because we have a large investment portfolio. In addition, our insurance liabilities and derivatives are sensitive to changing market factors, including equity market performance and interest ~~rates. During the third quarter 2022, equity markets continued their decline, while interest~~ rates, which continued to rise ~~and are anticipated to continue to rise throughout~~during the ~~year based on statements of members of the Board of Governors of the Federal Reserve System.~~second quarter 2023. An increase in market volatility could continue to affect our business, including through effects on the yields we earn on invested assets, changes in required reserves and capital and fluctuations in the value of our AUM and AV, from which we derive our fee income. These effects could be exacerbated by uncertainty about future fiscal policy, changes in tax policy, the scope of potential deregulation and levels of global trade.

The potential for increased volatility, coupled with prevailing interest rates remaining below historical averages despite recent increases, could pressure sales and reduce demand for our products as consumers consider purchasing alternative products to meet their objectives. In addition, this environment could make it difficult to consistently develop products that are attractive to customers. Financial performance can be adversely affected by market volatility and equity market declines as fees driven by AV and AUM fluctuate, hedging costs increase and revenues decline due to reduced sales and increased outflows

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We monitor the behavior of our customers and other factors, including mortality rates, morbidity rates, annuitization rates and lapse and surrender rates, which change in response to changes in capital market conditions, to ensure that our products and solutions remain attractive and profitable. For additional information on our sensitivity to interest rates and capital market prices, see “Quantitative and Qualitative Disclosures About Market Risk.” in the Recast 2022 Annual Report.

Regulatory Developments

We are regulated primarily by the Arizona Department of Insurance and Financial Institutions, with some policies and products also subject to federal regulation. On an ongoing basis, regulators refine capital requirements and introduce new reserving standards. Regulations recently adopted or currently under review can potentially impact our statutory reserve and capital requirements.

~~The~~On August 13, 2023, the NAIC ~~is evaluating~~adopted a short-term solution related to the ~~appropriate~~ accounting treatment of an insurer’s negative interest maintenance reserve (“IMR”) balance, ~~since~~which may occur when a rising interest rate environment ~~may cause~~causes an insurer’s IMR balance to become negative as a result of bond sales executed at a capital loss. If this occurs, ~~current~~previous statutory accounting guidance ~~requires~~required the non-admittance of negative IMR, which can impact how accurately an insurer’s surplus and financial strength are reflected in its financial statements and result in lower reported surplus and RBC ratios. ~~The NAIC has exposed~~NAIC’s new interim statutory accounting guidance, ~~that would permit~~which is effective until December 31, 2025, allows an insurer with an authorized control level RBC greater than 300% to admit negative IMR up to 5%10% of its general account capital and surplus, subject to certain restrictions and reporting obligations. ~~Comments on the proposal are due in June 2023.~~ The NAIC ~~is focused on identifying an interim solution for year-end 023 statutory reporting, although it also~~ intends to develop a long-term solution ~~even if interest rates change. The Company currently has $11 million~~for the accounting treatment of negative IMR, ~~and would be able~~which may nullify the application of the proposed short-term solution if implemented prior to ~~admit such negative IMR subject to the restrictions required by the NAIC.~~December 31, 2025.

The NAIC ~~is also~~has been evaluating the risks associated with insurers’ investments in certain categories of structured securities, including CLOs. In March 2023, the NAIC adopted an amendment to the Purposes and Procedures Manual to give the NAIC’s Structured Securities Group, housed within the SVO, responsibility for modeling CLO securities and evaluating tranche level losses across all debt and equity tranches under a series of calibrated and weighted collateral stress scenarios in order to assign NAIC designations. Under the amended Purposes and Procedures Manual, which will become effective no earlier than year-end 2024 financial reporting, CLO investments will no longer be broadly exempt from filing with the SVO based on ratings from Credit Rating Providers. The NAIC’s goal is to ensure that the weighted average RBC factor for owning all tranches of a CLO more closely aligns with what would be required for directly owning all of the underlying loan collateral, in order to avoid RBC arbitrage. The NAIC is collaborating with interested parties to develop and refine the process for modeling CLO investments.

~~The~~ In addition, on August 16, 2023, the NAIC ~~has also proposed an interim change to their~~increased the RBC ~~requirement~~factor for ~~equity tranches of all securitizations, including CLOs. If adopted, this would increase the capital charge for these equity~~structured security residual tranches from 30% to 45% beginning on January 1, 2024. We cannot predict what effect this may have on our business and compliance costs.

The NAIC is also developing a new model law to replace the existing privacy models #670 (Insurance Information and Privacy Protections Model Act) and #672 (Privacy of Consumer Financial and Health Information Regulation). ~~This proposal remains subject to comment from regulators, insurance companies, and other~~The NAIC’s Privacy Protections (H) Working Group (“PPWG”) held meetings in the spring, during which interested parties and thus may still be revised or delayed. An interim charge will likely have to be approved by June 30 for it to be effective for year-end 2023 statutory filings. The interim charge is intended to remain in effect untilconsumer advocates provided feedback on the ~~NAIC finalizes~~initial exposure draft of the new Consumer Privacy Protections and ~~adopts its modeling framework for CLOs which is not expected to be completed until at least year-end 2024.~~

In March 2023, the Securities and Exchange Commission (SEC) reopened the comment period for the Investment Management Cybersecurity Release proposing new rules under the Investment Advisers Act of 1940 and the Investment Company Act of 1940 that would require registered investment advisers and investment companies to adopt and implement written cybersecurity policies and procedures reasonably designed to: (1) address cybersecurity risk management, (2) disclose information about cybersecurity risks and incidents, (3) report information confidentially to the SEC about certain cybersecurity incidents, and (4) maintain related records.

In addition, in March 2023, the SEC proposed rule amendments that would require brokers and dealers, investment companies, and investment advisers registered with the SEC to adopt written policies and procedures for incident response programs to address unauthorized access to or use of customer information, including procedures for providing timely notification to individuals affected by an incident involving sensitive customer information with details about the incident and information designed to help affected individuals respond appropriately.The proposal also would broaden the scope of information covered by amending requirements for safeguarding customer records and information, and for properly disposing of consumer report information, as well as impose requirements to maintain written records documenting compliance with the proposed amended rules. Finally, the proposed amendments would conform annual privacy notice delivery provisions to the terms of an exception provided by a statutory amendment to the Gramm-Leach-Bliley Act.

Model Law (“Model

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~~Finally, in March 2023,~~674”). PPWG rewrote the ~~SEC proposed~~model law and exposed a new rule and form and amendments to existing recordkeeping rules to require broker-dealers, clearing agencies, major security-based swap participants, the Municipal Securities Rulemaking Board, national securities associations, national securities exchanges, security-based swap data repositories, security-based swap dealers, and transfer agents to address cybersecurity risks through: (1) policies and procedures, (2) immediate notificationdraft of Model 674 on July 11, 2023. Due to the ~~SEC~~large number of comments received, the ~~occurrence~~PPWG intends to ask for an extension of ~~a significant cybersecurity incident, (3) as applicable, reporting detailed information~~time to develop the ~~SEC about a significant cybersecurity incident, and (4) public disclosures with respect to cybersecurity risks and significant cybersecurity incidents.~~

~~The public comment period for this proposed rule will end~~new model law at he NAIC’s Fall National Meeting in ~~May~~December 2023. We cannot predict whether Model 674 will be adopted, what form ~~the final new or amended rules may~~it will take, or what ~~affect such developments in the law may~~effect it would have on our business or compliance ~~costs.~~ efforts in the form adopted by states whose laws apply to our insurance subsidiaries.

In July 2023, the SEC adopted the Risk Management, Strategy, Governance, and Incident Disclosure Final Rule (the “Cybersecurity Final Rule”) enhancing disclosure requirements for registered companies covering cybersecurity risk and management. The Cybersecurity Final Rule requires registrants to disclose material cybersecurity incidents on Form 8-K within four business days of a determination that a cybersecurity incident is material, and such materiality determination must be made without unreasonable delay. The rule also requires periodic disclosures of, among other things, details on the company’s processes to assess, identify, and manage cybersecurity risks, cybersecurity governance, and management’s role in overseeing such a compliance program, including the board of directors’ oversight of cybersecurity risks. Certain reporting requirements under the Cybersecurity Final Rule become effective as early as December 2023.

For additional information on the regulatory developments, see “Business—Regulation” and “Risk Factors—Legal and Regulatory Risks” in the Recast 2022 ~~Form 10-K.~~Annual Report.

Revenues

Our revenues come from three principal sources:

•fee income derived from our ~~products~~products;

•premiums from our traditional life insurance, annuity, and employee benefits products; and

•investment income from our General Account investment portfolio.

Our fee income varies directly in relation to the amount of the underlying AV or benefit base of our life insurance and annuity products which are influenced by changes in economic conditions, primarily equity market returns, as well as net flows. Our premium income is driven by the growth in new policies written and covered lives, and the persistency of our in-force policies, which are influenced by a combination of factors, including our efforts to attract and retain customers and market conditions that influence demand for our products. Our investment income is driven by the yield on our General Account investment portfolio and is impacted by the prevailing level of interest rates as we reinvest cash associated with maturing investments and net flows to the portfolio.

Benefits and Other Deductions

Our primary expenses are:

•policyholders’ benefits and interest credited to policyholders’ account balances;

•sales commissions and compensation paid to intermediaries and advisors that distribute our products and services; and

•compensation and benefits provided to Equitable Financial’s employees and other operating expenses.

Policyholders’ benefits are driven primarily by mortality, morbidity, customer withdrawals and benefits which change in response to changes in capital market conditions. In addition, some of our policyholders’ benefits are directly tied to the AV and benefit base of our variable annuity products. Interest credited to policyholders varies in relation to the amount of the underlying AV or benefit base. Sales commissions and compensation paid to intermediaries and advisors vary in relation to premium and fee income generated from these sources, whereas compensation and benefits to Equitable Financial’s employees are more constant and impacted by market wages and decline with increases in efficiency. Our ability to manage these expenses across various economic cycles and products is critical to the profitability of our company.

Significant Factors Impacting Our Results

The following significant factors have impacted, and may in the future impact, our financial condition, results of operations or cash flows.

Impact of Hedging on Results

We have offered and continue to offer variable annuity and life insurance products. The future claims exposure on these features is sensitive to movements in the equity markets and interest rates. Accordingly, we have implemented hedging

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programs designed to mitigate the economic exposure to us from these features due to equity market and interest rate movements. Changes in the values of the derivatives associated with these programs due to equity market and interest rate movements are recognized in the periods in which they occur while corresponding changes in offsetting liabilities not measured at fair value, are recognized over time. This results in net income volatility.

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Effect of Assumption Updates on Operating Results

Our actuaries oversee the valuation of the product liabilities and assets and review the underlying inputs and assumptions. We comprehensively review the actuarial assumptions underlying these valuations and update assumptions during the third quarter of each year. Assumptions are based on a combination of Company experience, industry experience, management actions and expert judgment and reflect our best estimate as of the date of the applicable financial statements. Changes in assumptions can result in a significant change to the carrying value of product liabilities and assets and, consequently, the impact could be material to earnings in the period of the change.

Most of the variable annuity products, variable universal life insurance and universal life insurance products we offer maintain policyholder deposits that are reported as liabilities and classified within either Separate Accounts liabilities or policyholder account balances. Our products and riders also impact liabilities for future policyholder benefits and unearned revenues and assets for DAC and DSI. The valuation of these assets and liabilities (other than deposits) is based on differing accounting methods depending on the product, each of which requires numerous assumptions and considerable judgment. The accounting guidance applied in the valuation of these assets and liabilities includes, but is not limited to, the following: (i) universal life insurance and variable life insurance secondary guarantees for which benefit liabilities are determined by estimating the expected value of death benefits payable when the account balance is projected to be zero and recognizing those benefits ratably over the accumulation period based on total expected assessments; (ii) certain product guarantees for which benefit liabilities are accrued over the life of the contract in proportion to actual and future expected policy assessments; and (iii) certain product guarantees reported as embedded derivatives at fair value.

For further details of our accounting policies and related judgments pertaining to assumption updates, see Note 2 of the Notes to the Financial Statements.

Results of Operations

The following table summarizes our statements of income (loss) for the ~~three~~six months ended ~~March 31,~~June 30, 2023 and 2022:

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Statement of Income (Loss)


		Three Months Ended March 31,				Six Months Ended June 30,
		2023		2022				2023		2022
		(in millions)				(in millions)
REVENUES	REVENUES						REVENUES
Policy charges and fee income	Policy charges and fee income	$	61	$	56		Policy charges and fee income	$	472	$	112
Premiums	Premiums	69		49			Premiums	181		109
Net derivative gains (losses)	Net derivative gains (losses)	6		(8)			Net derivative gains (losses)	(694)		(11)
Net investment income (loss)	Net investment income (loss)	29		20			Net investment income (loss)	85		41
Investment gains (losses), net	Investment gains (losses), net	(5)		(1)			Investment gains (losses), net	(5)		(3)
Investment management and service fees	Investment management and service fees	5		5			Investment management and service fees	110		11
Other income	Other income	6		—			Other income	44		1
Total revenues	Total revenues	171		121			Total revenues	193		260

BENEFITS AND OTHER DEDUCTIONS	BENEFITS AND OTHER DEDUCTIONS						BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	Policyholders’ benefits	79		74			Policyholders’ benefits	414		156
Remeasurement of liability for future policy benefits	Remeasurement of liability for future policy benefits	(1)		(1)			Remeasurement of liability for future policy benefits	—		(1)
Change in market risk benefits and purchased market risk benefits	Change in market risk benefits and purchased market risk benefits	—		(5)			Change in market risk benefits and purchased market risk benefits	(862)		(4)
Interest credited to policyholders’ account balances	Interest credited to policyholders’ account balances	23		19			Interest credited to policyholders’ account balances	208		42
Compensation and benefits	Compensation and benefits	13		11			Compensation and benefits	28		20
Commissions	Commissions	31		16			Commissions	121		42

Amortization of deferred policy acquisition costs	Amortization of deferred policy acquisition costs	12		10			Amortization of deferred policy acquisition costs	28		20
Other operating costs and expenses	Other operating costs and expenses	23		23			Other operating costs and expenses	245		44
Total benefits and other deductions	Total benefits and other deductions	180		147			Total benefits and other deductions	182		319
Income (loss) from continuing operations, before income taxes	Income (loss) from continuing operations, before income taxes	(9)		(26)			Income (loss) from continuing operations, before income taxes	11		(59)
Income tax (expense) benefit	Income tax (expense) benefit	72		6			Income tax (expense) benefit	66		14

Net income (loss)	Net income (loss)	$	63	$	(20)		Net income (loss)	$	77	$	(45)

The following discussion compares the results for the ~~three~~six months ended ~~March 31,~~June 30, 2023 to the ~~three~~six months ended ~~March 31,~~June 30, 2022.

~~Three~~Six Months Ended ~~March 31,~~June 30, 2023 Compared to the ~~Three~~Six Months Ended ~~March 31,~~June 30, 2022

Net Income (Loss) Attributable to Equitable America

Net income attributable to Equitable America increased ~~$83~~$122 million, to net income of ~~$63~~$77 million for the ~~three~~six months ended ~~March 31,~~June 30, 2023 from a net loss of ~~$20~~$45 million for the ~~three~~six months ended ~~March 31,~~June 30, 2022, primarily driven by the following notable items:

Favorable items included:

•Change in market risk benefits and purchased market risk benefits decreased by $858 million mainly due to the increase in equity market and interest rate impacts on the assumed MRBs from Equitable Financial as part of the Reinsurance Treaty in the second quarter 2023.

•Fee-type revenue increased by ~~$31~~$574 million mainly due to the Reinsurance Treaty in the second quarter 2023 and business growth, primarily driven by an increase in employee benefit premiums.

•Net ~~derivative gains (losses) increased $14 million mainly due to market appreciation during the first quarter of 2023 compared to market depreciation during the first quarter 2022.~~

•~~Net~~ investment income increased by $9$44 million mainly due to higher assets and higher yields, including higher SCS asset balances ~~partially offset by lower income from seed capital investments.~~due to higher sales.

•Income tax benefit increased ~~$66~~$52 million primarily driven by a ~~decrease to~~release of the valuation allowance of $69 ~~million.~~million, partially offset by pre-tax income for the six months ended June 30, 2023 compared to a pre-tax loss for the six months ended June 30, 2022.

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These were partially offset by the following unfavorable items:

•~~Commissions~~Net derivative losses increased ~~by $15~~$683 million ~~mainly~~primarily due to the Reinsurance Treaty in the second quarter as equity markets increased ~~sales~~compared to a decrease in the second quarter of 2022 resulting in losses associated with indexed annuity products which were offset by net embedded derivative gains related to ~~business growth.~~

~~Table~~the funds withheld and modified coinsurance portfolios held at Equitable Financial on behalf of ~~Contents~~the Company.

•Policyholders’ benefits increased by $5$258 million mainly due to ~~growth~~business assumed as part of the ~~employee benefits business.~~Reinsurance Treaty in the second quarter 2023.

•~~Change in market risk~~Compensation, benefits and ~~purchased market risk benefits~~other operating expenses increased ~~by $5~~of $209 million mainly due to ~~a decrease in interest rates during first quarter 2023 compared~~expense recognition related to ~~an increase during first quarter 2022, partially offset by equity market depreciation during first quarter 2022.~~

•~~Net investment gains (losses) decreased by $4 million primarily due~~the reinsurance deposit assets and expenses related to ~~realized losses on sales~~the assumed business as part of ~~AFS fixed maturities.~~the Reinsurance Treaty.

•Interest credited to policyholders’ account balances increased by $4$166 million ~~mainly~~primarily due to ~~general~~ business ~~growth.~~assumed as part of the Reinsurance Treaty in the second quarter 2023.

◦Commissions increased by $79 million primarily due to business assumed as part of the Reinsurance Treaty in the second quarter 2023 and an increase in sales related to business growth resulting from our initiative to begin offering a full suite of variable annuity products to policyholders located outside of New York.

Summary of Critical Accounting Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to adopt accounting policies and make estimates and assumptions that affect amounts reported in our financial statements included elsewhere herein. For a discussion of our significant accounting policies, see Note 2 of the Notes to the Financial Statements. The most critical estimates include those used in determining:

•market risk benefits and purchased market risk benefits;

•accounting for reinsurance;

•estimated fair values of investments in the absence of quoted market values and investment impairments;

•estimated fair values of freestanding derivatives and the recognition and estimated fair value of embedded derivatives requiring bifurcation;

•measurement of income taxes and the valuation of deferred tax assets; and

•liabilities for litigation and regulatory matters.

In applying our accounting policies, we make subjective and complex judgments that frequently require estimates about matters that are inherently uncertain. Many of these policies, estimates and related judgments are common in the insurance and financial services industries while others are specific to our business and operations. Actual results could differ from these estimates.

Market Risk Benefits

Market risk benefits include contract features that provide minimum guarantees to policyholders and include GMIB, GMDB, GMWB, GMAB, and ROP DB benefits. MRBs are measured at estimated fair value with changes reported in the ~~Change~~change in market risk benefits and purchased market risk benefits, except for the portion of the fair value change related to the Company’s own credit risk, which is recognized in OCI.

MRBs are measured at fair value on a seriatim basis using an ~~Ascribed Fee~~ascribed fee approach based upon policyholder behavior projections and risk neutral economic scenarios adjusted based on the facts and circumstances of the Company’s product features. Market conditions including, but not limited to, changes in interest rates, equity indices, market volatility and variations in actuarial assumptions, including policyholder behavior, mortality and risk margins related to non-capital market inputs, as well as changes in our nonperformance risk adjustment may result in significant fluctuations in the estimated fair value of the MRBs that could materially affect net income.

Risk margins are established to capture the non-capital market risks of the instrument which represent the additional compensation a market participant would require to assume the risks related to the uncertainties in certain actuarial

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assumptions. The establishment of risk margins requires the use of significant management judgment, including assumptions of the amount needed to cover the guarantees.

We ceded the risk associated with certain of the variable annuity products with GMxB features described in the preceding paragraphs. The value of the MRBs on the ceded risk is determined using a methodology consistent with that described previously for the guarantees directly written by us with the exception of the input for nonperformance risk that reflects the credit of the reinsurer.

Nonperformance Risk Adjustment

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The valuation of our MRBs includes an adjustment for the risk that we fail to satisfy our obligations, which we refer to as our nonperformance risk. The nonperformance risk adjustment, which is captured as a spread over the risk-free rate in determining the discount rate to discount the cash flows of the liability, is determined by taking into consideration publicly available information relating to spreads on corporate bonds in the secondary market comparable to Holdings’ financial strength rating.

The table below illustrates the impact that a range of reasonably likely variances in credit spreads would have on our balance sheet, excluding the effect of income tax, related to the GMxB Core MRBs measured at estimated fair value. Even when credit spreads do not change, the impact of the nonperformance risk adjustment on fair value will change when the cash flows within the fair value measurement change. The table only reflects the impact of changes in credit spreads on our financial statements included elsewhere herein and not these other potential changes. In determining the ranges, we have considered current market conditions, as well as the market level of spreads that can reasonably be anticipated over the near term. The ranges do not reflect extreme market conditions such as those experienced during the 2008–2009 financial crisis as we do not consider those to be reasonably likely events in the near future.

NPR Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
Increase in NPR by 50bps	$	(8)
Decrease in NPR by 50bps	$	9

Sensitivity of MRBs to Changes in Interest Rates

The following table demonstrates the sensitivity of the MRBs to changes in long-term interest rates by quantifying the adjustments that would be required, assuming an increase and decrease in long-term interest rates of 50bps. This information considers only the direct effect of changes in the interest rates on MRB balances, net of ~~reinsurance.~~reinsurance:

Interest Rate Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
Increase in interest rates by 50bps	$	(7)
Decrease in interest rates by 50bps	$	8

Sensitivity of MRBs to Changes in Equity Returns

The following table demonstrates the sensitivity of the MRBs to changes in equity ~~returns.~~returns:

Equity Returns Sensitivity

December 31, 2022

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	Increase/(Decrease) In MRB
	(in millions)
Increase in equity returns by 10%	$	(6)
Decrease in equity returns by 10%	$	7

Sensitivity of MRBs to Changes in GMIB Lapses

Lapse rates are adjusted at the contract level based on a comparison of the value of the embedded GMIB rider and the current policyholder account value, which include other factors such as considering surrender charges. Generally, lapse rates are assumed to be lower in periods when a surrender charge applies. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse.

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GMIB Lapse floor Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
GMIB Lapse floor of 1%	$	6

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to the quantitative and qualitative disclosures about market risk described in the Recast 2022 Annual Report ~~on Form 10-K for the year ended December 31, 2022~~ in "Quantitative and Qualitative Disclosures About Market Risk".

Item 4. Controls and Procedures

Management, with the participation of the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures, as defined in Rule 13a-15(e) of the Exchange Act. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of ~~March 31,~~June 30, 2023, the Company’s disclosure controls and procedures were effective.

During the first quarter 2023, we adopted the new accounting standard ASU 2018-12, Financial Services – Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts. We have modified our existing controls infrastructure, primarily through enhanced automation in our actuarial processes. There are no otherNo changes in ~~our~~the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act) ~~that~~ occurred during the quarter ended ~~March 31,~~June 30, 2023, that ~~have~~has materially affected, or ~~are~~is reasonably likely to materially affect, ~~our~~the Company’s internal control over financial reporting.

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Part II OTHER INFORMATION

Item 1. Legal Proceedings

For information regarding certain legal proceedings pending against us, see Note 13 of the Notes to the Financial Statements (unaudited) in this Form 10-Q. Also see “Risk Factors—Legal and Regulatory Risks—Legal and regulatory actions” included in ~~our~~the Recast 2022 Annual ~~Report on Form 10-K for the year ended December 31, 2022.~~Report.

Item 1A. Risk Factors

You should carefully consider the risks described in the “Risk Factors” section included in ~~our Annual Report on~~the 2022 Form ~~10-K for the year ended December 31, 2022.~~10-K. Risks to which we are subject also include, but are not limited to, the factors mentioned under “Note Regarding Forward-Looking Statements and Information” above and the risks of our businesses described elsewhere in this Quarterly Report on Form 10-Q.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

~~None.~~Insider Trading Arrangements During the Three Months Ended June 30, 2023

None of our Section 16 officers or directors (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act or any “non-Rule 10b5-1 trading arrangement” (as defined in Section 408(c) of Regulation S-K).

Item 6. Exhibits

INDEX TO EXHIBITS


Number		Description
10.1	#	Indemnity Reinsurance Agreement, by and between Equitable Financial Life Insurance Company and Equitable Financial Life Insurance Company of America, dated as of May 17, 2023.
31.1	#	Section 302 Certification made by the registrant’s Chief Executive Officer
31.2	#	Section 302 Certification made by the registrant’s Chief Financial Officer
32.1	#	Section 906 Certification made by the registrant’s Chief Executive Officer
32.2	#	Section 906 Certification made by the registrant’s Chief Financial Officer
101.INS		XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
104		Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibits 101).

______________

# Filed herewith.

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GLOSSARY

Selected Financial Terms


Account Value (“AV”)			Generally equals the aggregate policy account value of our retirement and protection products. General Account AV refers to account balances in investment options that are backed by the General Account while Separate Accounts AV refers to Separate Accounts investment assets.

Alternative investments			Investments in real estate and real estate joint ventures and other limited partnerships.

Annualized Premium			100% of first year recurring premiums (up to target) and 10% of excess first year premiums or first year premiums from single premium products.

Assets under management (“AUM”)			Investment assets that are managed by one of our subsidiaries and includes: (i) assets managed by AB, (ii) the assets in our GAIA portfolio and (iii) the Separate Account assets of our retirement and protection businesses. Total AUM reflects exclusions between segments to avoid double counting.

Combined RBC Ratio			Calculated as the overall aggregate RBC ratio for the Company’s insurance subsidiaries including capital held for its life insurance and variable annuity liabilities and non-variable annuity insurance liabilities.

Conditional tail expectation (“CTE”)			Calculated as the average amount of total assets required to satisfy obligations over the life of the contract or policy in the worst x% of scenarios. Represented as CTE (100 less x). Example: CTE95 represents the worst five percent of scenarios.

Deferred policy acquisition cost (“DAC”)			Represents the incremental costs related directly to the successful acquisition of new and certain renewal insurance policies and annuity contracts and which have been deferred on the balance sheet as an asset.

Deferred sales inducements (“DSI”)			Represent amounts that are credited to a policyholder’s account balance that are higher than the expected crediting rates on similar contracts without such an inducement and that are an incentive to purchase a contract and also meet the accounting criteria to be deferred as an asset that is amortized over the life of the contract.

Dividends Received Deduction (“DRD”)			A tax deduction under U.S. federal income tax law received by a corporation on the dividends it receives from other corporations in which it has an ownership stake.

Fee-Type Revenue			Revenue from fees and related items, including policy charges and fee income, premiums, investment management and service fees, and other income.

Gross Premiums			First year premium and deposits and ~~Renewal~~renewal premium and deposits.

GMxB			A general reference to all forms of variable annuity guaranteed benefits, including guaranteed minimum living benefits, or GMLBs (such as GMIBs, GMWBs and GMABs), and guaranteed minimum death benefits, or GMDBs (inclusive of return of premium death benefit guarantees).

GMxB Core			Retirement Cornerstone and Accumulator sold 2011 and later.

GMxB Legacy			Fixed-rate GMxB business written prior to 2011


Invested assets			Includes fixed maturity securities, equity securities, mortgage loans, policy loans, alternative investments and short-term investments.

P&C			Property and casualty.

Premium and deposits			Amounts a policyholder agrees to pay for an insurance policy or annuity contract that may be paid in one or a series of payments as defined by the terms of the policy or contract.

Protection Solutions Reserves			Equals the aggregate value of Policyholders’ account balances and Future policy benefits for policies in our Protection Solutions segment.

Protective Life & Annuity			Business 100% ceded to Protective in a reinsurance treaty.

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Reinsurance			Insurance policies purchased by insurers to limit the total loss they would experience from an insurance claim.

Renewal premium and deposits			Premiums and deposits after the first twelve months of the policy or contract.

Risk-based capital (“RBC”)			Rules to determine insurance company statutory capital requirements. It is based on rules published by the National Association of Insurance Commissioners (“NAIC”).

Total adjusted capital (“TAC”)			Primarily consists of capital and surplus, and the asset valuation reserve.

~~Table of Contents~~


Value of business acquired (“VOBA”)			Present value of estimated future gross profits from in-force policies of acquired businesses.
Product Terms

401(k)			A tax-deferred retirement savings plan sponsored by an employer. 401(k) refers to the section of the Internal Revenue Code of 1986, as amended (the “Code”) pursuant to which these plans are established.

403(b)			A tax-deferred retirement savings plan available to certain employees of public schools and certain tax-exempt organizations. 403(b) refers to the section of the Code pursuant to which these plans are established.

457(b)			A deferred compensation plan that is available to governmental and certain non-governmental employers. 457(b) refers to the section of the Code pursuant to which these plans are established.

Accumulation phase			The phase of a variable annuity contract during which assets accumulate based on the policyholder’s lump sum or periodic deposits and reinvested interest, capital gains and dividends that are generally tax-deferred.

Affluent			Refers to individuals with $250,000 to $999,999 of investable assets.

Annuitant			The person who receives annuity payments or the person whose life expectancy determines the amount of variable annuity payments upon annuitization of an annuity to be paid for life.

Annuitization			The process of converting an annuity investment into a series of periodic income payments, generally for life.


Benefit base			A notional amount (not actual cash value) used to calculate the owner’s guaranteed benefits within an annuity contract. The death benefit and living benefit within the same contract may not have the same benefit base.

Cash surrender value			The amount an insurance company pays (minus any surrender charge) to the policyholder when the contract or policy is voluntarily terminated prematurely.

Deferred annuity			An annuity purchased with premiums paid either over a period of years or as a lump sum, for which savings accumulate prior to annuitization or surrender, and upon annuitization, such savings are exchanged for either a future lump sum or periodic payments for a specified length of time or for a lifetime.

Dollar-for-dollar withdrawal			A method of calculating the reduction of a variable annuity benefit base after a withdrawal in which the benefit is reduced by one dollar for every dollar withdrawn.

EQUI-VEST Group (“EG”)			A traditional variable deferred annuity without enhanced guaranteed benefits with single and ongoing premiums sold in the tax-exempt 403(b)/(457(b) markets.

EQUI-VEST Individual (“(EI”)			A traditional variable deferred annuity without enhanced guaranteed benefits sold in the individual market.
Fixed annuity			An annuity that guarantees a set annual rate of return with interest at rates we determine, subject to specified minimums. Credited interest rates are guaranteed not to change for certain limited periods of time.

Fixed Rate GMxB			Guarantees on our individual variable annuity products that are based on a rate that is fixed at issue.

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Floating Rate GMxB			Guarantees on our individual variable annuity products that are based on a rate that varies with a specified index rate, subject to a cap and floor.

Future policy benefits			Future policy benefits for the annuities business are comprised mainly of liabilities for life-contingent income annuities, and liabilities for the variable annuity guaranteed minimum benefits accounted for as insurance. Future policy benefits for the life business are comprised mainly of liabilities for traditional life and certain liabilities for universal and variable life insurance contracts (other than the Policyholders’ account balance).

General Account Investment Portfolio			The invested assets held in the General Account.

General Account			The assets held in the general accounts of our insurance companies as well as assets held in our ~~separate accounts~~Separate Accounts on which we bear the investment risk.

~~Table of Contents~~


GMxB			A general reference to all forms of variable annuity guaranteed benefits, including guaranteed minimum living benefits, or GMLBs (such as GMIBs, GMWBs and GMABs), and guaranteed minimum death benefits, or GMDBs (inclusive of return of premium death benefit guarantees).

Guaranteed income benefit (“GIB”)			An optional benefit which provides the policyholder with a guaranteed lifetime annuity based on predetermined annuity purchase rates applied to a GIB benefit base, with annuitization automatically triggered if and when the contract AV falls to zero.


Guaranteed minimum accumulation benefits (“GMAB”)			An optional benefit (available for an additional cost) which entitles an annuitant to a minimum payment, typically in lump-sum, after a set period of time, typically referred to as the accumulation period. The minimum payment is based on the benefit base, which could be greater than the underlying AV.

Guaranteed minimum death benefits (“GMDB”)			An optional benefit (available for an additional cost) that guarantees an annuitant’s beneficiaries are entitled to a minimum payment based on the benefit base, which could be greater than the underlying AV, upon the death of the annuitant.

Guaranteed minimum income benefits (“GMIB”)			An optional benefit (available for an additional cost) where an annuitant is entitled to annuitize the policy and receive a minimum payment stream based on the benefit base, which could be greater than the underlying AV.

Guaranteed minimum living benefits (“GMLB”)			A reference to all forms of guaranteed minimum living benefits, including GMIBs, GMWBs and GMABs (does not include GMDBs).

Guaranteed minimum withdrawal benefits (“GMWB”)			An optional benefit (available for an additional cost) where an annuitant is entitled to withdraw a maximum amount of their benefit base each year, for which cumulative payments to the annuitant could be greater than the underlying AV.

Guaranteed Universal Life (“GUL”)			A universal life insurance offering with a lifetime no lapse guarantee rider, otherwise known as a guaranteed UL policy. With a GUL policy, the premiums are guaranteed to last the life of the policy.

Guaranteed withdrawal benefit for life (“GWBL”)			An optional benefit (available for an additional cost) where an annuitant is entitled to withdraw a maximum amount of their benefit base each year, for the duration of the policyholder’s life, regardless of account performance.

High net worth			Refers to individuals with $1,000,000 or more of investable assets.

Index-linked annuities			An annuity that provides for asset accumulation and asset distribution needs with an ability to share in the upside from certain financial markets such as equity indices, or an interest rate benchmark. With an index-linked annuity, the policyholder’s AV can grow or decline due to various external financial market indices performance.

Investment Edge (“IE”)			A traditional variable deferred annuity without enhanced guaranteed benefits.

Indexed Universal Life (“IUL”)			A permanent life insurance offering built on a universal life insurance framework that uses an equity-linked approach for generating policy investment returns.

Living benefits			Optional benefits (available at an additional cost) that guarantee that the policyholder will get back at least his original investment when the money is withdrawn.

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Mortality and expense risk fee (“M&E fee”)			A fee charged by insurance companies to compensate for the risk they take by issuing life insurance and variable annuity contracts.


Net flows			Net change in customer account balances in a period including, but not limited to, gross premiums, surrenders, withdrawals and benefits. It excludes investment performance, interest credited to customer accounts and policy charges.

~~Table of Contents~~


Policyholder account balances			Annuities. Policyholder account balances are held for fixed deferred annuities, the fixed account portion of variable annuities and non-life contingent income annuities. Interest is credited to the policyholder’s account at interest rates we determine which are influenced by current market rates, subject to specified minimums. Life Insurance Policies. Policyholder account balances are held for retained asset accounts, universal life policies and the fixed account of universal variable life insurance policies. Interest is credited to the policyholder’s account at interest rates we determine which are influenced by current market rates, subject to specified minimums.

Return of premium (“ROP”) death benefit			This death benefit pays the greater of the account value at the time of a claim following the owner’s death or the total contributions to the contract (subject to adjustment for withdrawals). The charge for this benefit is usually included in the M&E fee that is deducted daily from the net assets in each variable investment option. We also refer to this death benefit as the Return of Principal death benefit.

Rider			An optional feature or benefit that a policyholder can purchase at an additional cost.

Roll-up rate			The guaranteed percentage that the benefit base increases by each year.

Separate Account			Refers to the separate account investment assets of our insurance subsidiaries excluding the assets held in those ~~separate accounts~~Separate Accounts on which we bear the investment risk.

Surrender charge			A fee paid by a contract owner for the early withdrawal of an amount that exceeds a specific percentage or for cancellation of the contract within a specified amount of time after purchase.


Surrender rate			Represents annualized surrenders and withdrawals as a percentage of average AV.

Universal life (“UL”) products			Life insurance products that provide a death benefit in return for payment of specified annual policy charges that are generally related to specific costs, which may change over time. To the extent that the policyholder chooses to pay more than the charges required in any given year to keep the policy in-force, the excess premium will be placed into the AV of the policy and credited with a stated interest rate on a monthly basis.

Variable annuity			A type of annuity that offers guaranteed periodic payments for a defined period of time or for life and gives purchasers the ability to invest in various markets though the underlying investment options, which may result in potentially higher, but variable, returns.

Variable Universal Life (“VUL”)			Universal life products where the excess amount paid over policy charges can be directed by the policyholder into a variety of Separate Account investment options. In the Separate Account investment options, the policyholder bears the entire risk and returns of the investment results.

Whole Life (“WL”)			A life insurance policy that is guaranteed to remain in-force for the policyholder’s lifetime, provided the required premiums are paid.

ACRONYMS

•“AB” or “AllianceBernstein” means AB Holding and ABLP.

•“AB Holding” means AllianceBernstein Holding L.P., a Delaware limited partnership.

•“AB Holding Units” means units representing assignments of beneficial ownership of limited partnership interests in AB Holding.

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•“ABLP” means AllianceBernstein L.P., a Delaware limited partnership and the operating partnership for the AB business.

•“AFS” means available-for-sale

•“AGL” means AXA Global Life

•“AOCI” means accumulated other comprehensive income

•“ASC” means Accounting Standards Codification

•“ASU” means Accounting Standards Update

•“AVR” means asset valuation reserve

•“AXA” means AXA S.A., a société anonyme organized under the laws of France, and formerly our controlling stockholder.

~~Table of Contents~~

•“AXA Financial” means AXA Financial, Inc., a Delaware corporation and a former wholly-owned direct subsidiary of Holdings. On October 1, 2018, AXA Financial merged with and into Holdings, with Holdings assuming the obligations of AXA Financial.

•“AXA RSUs” means AXA restricted stock units

•“BPs” means basis points

•“CARES Act” means Coronavirus Aid, Relief, and Economic Security Act

•“CDS” means credit default swaps

•“CDSC” means contingent deferred sales commissions

•“CEA” means Commodity Exchange Act

•“CECL” means current expected credit losses

•“CFTC” means U.S. Commodity Futures Trading Commission

•“COLI” means corporate owned life insurance

•“Company” means Equitable Financial Life Insurance Company of America (“Equitable America”), a direct wholly-owned subsidiary of Holdings.

•“CS Life” means Corporate Solutions Life Reinsurance Company, a Delaware corporation and a wholly-owned direct subsidiary of Holdings.

•“CS Life RE” means CS Life RE Company, an Arizona corporation and a wholly-owned indirect subsidiary of Holdings.

•“CSA” means credit support annex

•“CTE” means conditional tail expectation

•“DAC” means deferred policy acquisition costs

•“DCO” means designated clearing organization

•“DI” means disability income

•“Dodd-Frank Act” means Dodd-Frank Wall Street Reform and Consumer Protection Act

•“DOL” means U.S. Department of Labor

•“DSC” means debt service coverage

•“DSI” means deferred sales inducement

•“EAFE” means European, Australasia, and Far East

•“EFS” means Equitable Financial Services, LLC, a Delaware corporation and a wholly-owned direct subsidiary of Holdings.

•“EIM” means Equitable Investment Management Group, LLC, a Delaware limited liability company and a wholly-owned indirect subsidiary of Holdings.

•“Equitable Advisors” means Equitable Advisors, LLC, a Delaware limited liability company, our retail broker/dealer for our retirement and protection businesses and a wholly-owned indirect subsidiary of Holdings.

•“Equitable America” means Equitable Financial Life Insurance Company of America (f/k/a MONY Life Insurance Company of America), an Arizona corporation and a wholly-owned indirect subsidiary of Holdings.

•“Equitable Distributors” means Equitable Distributors, LLC, a Delaware limited liability company, our wholesale broker/dealer for our retirement and protection businesses and a wholly-owned indirect subsidiary of Holdings.

•“Equitable Financial QP” means Equitable Retirement Plan

•“Equitable Financial” means Equitable Financial Life Insurance Company, a New York corporation, a life insurance company and a wholly-owned subsidiary of EFS.

•“Equitable Network” means Equitable Network, LLC, a Delaware limited liability company and wholly-owned indirect subsidiary of Holdings and its subsidiary, Equitable Network of Puerto Rico, Inc.

•“EQ Premier VIP Trust” means EQ Premier VIP Trust, a series trust that is a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “Investment Company Act”), as an open-end management investment company.

•“EQAT” means EQ Advisors Trust, a series trust that is a Delaware statutory trust and is registered under the Investment Company Act as an open-end management investment company.

•“EQ AZ Life Re” means EQ AZ Life Re Company, an Arizona corporation and a wholly-owned indirect subsidiary of Holdings.

•“ERISA” means Employee Retirement Income Security Act of 1974

•“ETF” means exchange traded funds

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•“Exchange Act” means Securities Exchange Act of 1934, as amended

•“FABCP” means Funding Agreement-Backed Commercial Paper program

•“FASB” means Financial Accounting Standards Board

•“FDIC” means Federal Deposit Insurance Corporation

•“FHLB” means Federal Home Loan Bank

•“FINRA” means Financial Industry Regulatory Authority, Inc.

•“FIO” means Federal Insurance Office

•“FSOC” means Financial Stability Oversight Council

•The “General Partner” means AllianceBernstein Corporation, a Delaware corporation and the general partner of AB Holding and ABLP.

•“GIO” means guaranteed interest option

•“Holdings” means Equitable Holdings, Inc.

~~Table of Contents~~

•“Investment Advisers Act” means Investment Advisers Act of 1940, as amended

•“IPO” means initial public offering

•“IRS” means Internal Revenue Service

•“ISDA Master Agreement” means International Swaps and Derivatives Association Master Agreement

•“IUS” means Investments Under Surveillance

•“K-12 education market” means individuals in the kindergarten, primary and secondary education market

•“LGD” means loss given default

•“LIBOR” means London Interbank Offered Rate

•“LTV” means loan-to-value

•“Manual” means Accounting Practices and Procedures Manual as established by the NAIC

•“MD&A” means Management’s Discussion and Analysis of Financial Condition and Results of Operations

•“MRBs” means market risk benefits

•“MSO” means Market Stabilizer Option

•“NAIC” means National Association of Insurance Commissioners

•“NAR” means net amount at risk

•“NAV” means net asset value

•“NFA” means National Futures Association

•“NLG” means no-lapse guarantee

•“NYDFS” means New York State Department of Financial Services

•“OCI” means other comprehensive income

•“OTC” means over-the-counter

•“PD” means probability of default

•“Performance Share Plan” means AXA International Performance Shares Plan

•“PFBL” means profits followed by losses

•“R&P” means retirement and protection

•“RBG” means the Retirement Benefits Group, a specialized division of Equitable Advisors

•“REIT” means real estate investment trusts

•“RoU” means right of use

•“RSUs” means restricted stock units

•“RTM” means reversion to the mean

•“SAP” means statutory accounting principles

•“SCB LLC” means Sanford C. Bernstein & Co., LLC, a registered investment adviser and broker-dealer.

•“SCS” means Structured Capital Strategies

•“SEC” means U.S. Securities and Exchange Commission

•“SIO” means structured investment option

•“SPE” means special purpose entity

•“SPLLC” means special purpose limited liability company

•“Stock Option Plan” means AXA Stock Option Plan for AXA Financial Employees and Associates

•“TCJA” or “Tax Reform Act” means the Tax Cuts and Jobs Act, enacted on December 22, 2017

•“TDRs” means troubled debt restructurings

•“TIPS” means treasury inflation-protected securities

•“U.S. GAAP” means accounting principles generally accepted in the United States of America

•“ULSG” means universal life products with secondary guarantee

•“URR” means unearned revenue reserve

•“VIAC” means Venerable Insurance and Annuity Company

•“VIE” means variable interest entity

•“VISL” means variable interest-sensitive life

•“VOE” means voting interest entity

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, Equitable Financial Life Insurance Company of America has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.









Date: ~~May 12,~~August 21, 2023						/s/ Robin M. Raju
						Name: Robin M. Raju
						Title: Chief Financial Officer (Principal Financial Officer)

Date: ~~May 12,~~August 21, 2023						/s/ William Eckert
						Name: William Eckert
						Title: Chief Accounting Officer (Principal Accounting Officer)

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	March 31, 2023		March 31, 2022
	Universal Life		Universal Life
	(Dollars in millions)
Balance, beginning of the period	$	58	$	57
Beginning balance before AOCI adjustments	66		55
Effect of changes in interest rate and cash flow assumptions and model changes	—		—
Effect of actual variances from expected experience	(1)		(1)
Adjusted beginning of period balance	65		54
Interest accrual	1		1
Net assessments collected	2		2
Benefit payments	—		—

Ending balance before shadow reserve adjustments	68		57
Effect of shadow reserve adjustment	(6)		(2)
Balance, end of the period	$	62	$	55

Net liability for additional liability	$	62	$	55
Effect of reserve adjustment recorded in AOCI	—		—
Net liability for additional liability, after reinsurance recoverable	$	62	$	55
			—
Weighted-average duration of additional liability - death benefit (years)	32.3		33.9


	March 31,
	2023		2022
Weighted Average Interest Rate
Universal Life	5.5	%	5.5	%
Interest accretion rate	5.5	%	5.5	%


	Three Months Ended March 31, 2022
		As Previously Reported		ASU 2018-12 Impact		As Adjusted		Impact of Revisions		As Revised
		(in millions)
Statements of Income (Loss):





















Other operating costs and expenses		$	21	$	1	$	22	$	1	$	23
Total benefits and deductions		161		(15)		146		1		147
Income (loss) from continuing operations, before income taxes		(22)		(3)		(25)		(1)		(26)

Net income (loss) from continuing operations		(19)		—		(19)		(1)		(20)

Net income (loss)		$	(19)	$	—	$	(19)	$	(1)	$	(20)


	Three Months March 31, 2022
		As Reported		ASU 2018-12 Impact		As Adjusted		Impact of Revision		As Revised
		(in millions)
Statement of Cash Flows:
Cash flow from operating activities:
Net income (loss)		$	(19)	$	—	$	(19)	$	(1)	$	(20)
























Future policy benefits		(4)		—		(4)		13		9
Reinsurance recoverable		14		—		14		(13)		1




Other, net		73		—		73		1		74